{"id": "0000012637", "text": ["PETITIONER: , Vs. RESPONDENT: COMMISSIONER OF INCOME-TAX, DATE OF JUDGMENT: 08/12/1965 BENCH: , S.M. BENCH: , S.M. SUBBARAO, K. SHAH, J.C. CITATION: 1966 AIR 1053 1966 SCR (2) 944 CITATOR INFO : F 1967 SC 819 (5) R 1969 SC 840 (11) R 1969 SC 946 (5) E 1969 SC1160 (5) D 1975 SC 97 (20) R 1976 SC 772 (6) R 1986 SC1483 (4) ACT: Indian Income-tax Act , 1922, s. 10(2)(xv) -Loan obtained by company-Stamp duty and other expenditure incurred in obtaining the loan-Whether capital or revenue expenditure- Whether laid out for purpose of business. HEADNOTE: During the accounting period relevant for the assessment year 1950-51 the appellant company obtained a loan of 40 lakhs of rupees from . The loan was secured by a charge on the fixed assets of the company. A sum of Rs. 84,633 was shown in the Balance Sheet for the said accounting year as mortgage loan expenses; the sum was not charged as expenditure in the profit and loss account. In the accounts for the accounting year ending March 31, 1953, this sum was written off by appropriation against profits of that year. The Income-tax Officer disallowed the deduction; he held that the expenditure was incurred in obtaining capital and should be distinguished from interest on borrowed capital which alone was admissible as a deduction under s. 10(2)(iii) . In his view the expenditure was of a capital nature and therefore not admissible under s. 10(2)(xv) either. After intermediate proceedings in reference gave a finding upholding the view of the Income-tax Officer. The appellant by special leave, came to this Court. It was contended on behalf of the appellant that : (1) the expenditure in question was not incurred to acquire any asset or advantage of an enduring nature; (2) it was applied wholly and exclusively for the purposes of the business; and (3) was admissible as a deduction under S. 10 (2) (xv). HELD : In the circumstances of the case the expenditure in question was revenue expenditure within s. 10(2)(xv) . (i)When there is no express prohibition, an outgoing, by means of which an assessee procures the use of a thing by which it makes a profit, is deductible from the receipts of the business to ascertain taxable income. On the facts of the instant case, the money secured by the loan was the thing for the use of which this expenditure was made. In principle, apart from any statutory provisions, there is no distinction, as drawn by the Income-tax Officer, between interest in respect of a loan and an expenditure incurred for obtaining the loan. [950 G-H] (ii)A loan obtained cannot be treated as an asset or advantage for the enduring benefit of the business of the assessee. A loan is a liability and has to be repaid and it is erroneous to consider a liability as an asset or an advantage. [955 C] (iii)The nature of the expenditure incurred in raising a loan cannot be made to depend on the nature and purpose of the loan. A loan may be intended to be used for the purchase of raw material when it is negotiated but the company may after raising the lo-an change its mind and spend it on securing capital assets, [955 11-956 B] 945 (iv)The loan was voluntarily entered into in order to facilitate the running of the business of the company and it could not be said that it was not laid out wholly and exclusively for the purpose of the business. [958 B] Case law considered. JUDGMENT: ", "CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1106 of 1964. Appeal by special leave from the judgment and order dated the October 31, 1961 of in Tax Case No. 67 of 1958. ", ", and , for the appellant. ", ", , and , for the respondent. ", "The Judgment of the Court was delivered by , This appeal by special leave is directed against the judgment of at Madras answering the following question of law in favour of the respondent : ", "\"Whether on the facts and in the circumstances of the case, the was right in law in holding that the sum of rupees 84,633/- expended by the assessee in obtaining the loan or any part thereof is an allowable expenditure ?\" ", "The facts and circumstances of the case as stated by the in the statement of the case are as follows : The appellant, , Madras, hereinafter referred to as the assessee, is a public limited company. The question arises in respect of the assessment year 1950- 51, accounting period April 1, 1949 to March 31, 1950. During the accounting year it obtained a loan of 40 lakhs of rupees from . This loan was secured by a charge on the fixed assets of the company. Since Mr. , the learned counsel for the respondent, has disputed some facts as stated by the Appellant , it would be convenient to give these facts in the words of the Appellate . It is stated in the statement of the case that \"the proceeds of this loan was utilised to pay off a prior debt of 25 lakhs due to Messrs and . It cannot be stated definitely how the balance of 15 lakhs was used but the directors, while reporting on the accounts for the year ended 31-3-1949 on 4-10-1949 stated that that was utilised towards working funds.\" The expenditure of Rs. 84,633/- in connection with this loan was made up of thefollowing items : ", "Stamps 60,02300 Registration Fee 16,,06700 Charges for certified copy of the mortgage deed 2800 Indemnity deed by 1500 's fee for drafting deed 7,50000 Legal fees 1,00000 Total Rs. 84,633 0 0 The assessee did not charge this expenditure in the profits and loss account for that year. It was shown in the Balance Sheet as mortgage loan expenses. It continued to be so shown till March 31, 1952. In the accounts for March 31, 1953 this was written off by appropriation against the profits of that year. ", "The Income Tax Officer refused to allow the deduction of Rs. 84,633/-. He observed \"As per the information furnished by the auditors, Rs. 25 lakhs of the loan was to be paid to Messrs , Limited, and in, discharge of the amount borrowed from them and utilised on the capital assets of the company. ", "Though in the Company's books the amount of Rs. 84,633 was not charged to revenue but capitalised and carried forward in the Balance Sheet, for purposes of income tax, the Company's auditors claim the same as an admissible item of revenue expenditure.\" He held that the expenditure was incurred in obtaining capital and should be distinguished from interest on borrowed capital which was alone admissible as a deduction under S. 10 (2) (iii). According to him, s. 10 (2) (xi) specifically excludes from consideration any item of capital expenditure. He further held that the case was not distinguishable from the decision in v. , Central Provinces(1). The Appellate Assistant Commissioner agreed with the Income Tax Officer. distinguished the case of ", "(1) 6 I.T.C. 28. ", "947 ", "v. Commissioner of Income Tax(1) on the ground that in the Nagpur Electric Light(1) case money was expended for obtaining capital. It observed as follows \"Here we find the position to be different. A study of the balance-sheets of the company as at 31-3-1949 discloses the fact that the paid- up capital was sufficient to cover the entire capital outlay of the company and that the further borrowal of Rs. 25 lakhs was for aug- menting the working. funds of the company. It appears to us that even at that early stage the money was borrowed and used not for capital purposes but for augmenting the working funds of the company. We, therefore, consider that the whole of the mortgage loan was used firstly to discharge the loan of Rs. 25 lakhs and the balance for working funds and, as such, the whole of the amount was purely for the purposes of augmenting the working capital of the company and that it could not be stated that it was used for capital purposes. In this view of the matter, we hold that the money expended in obtaining the loan is an allowable expenditure.\" , after noticing the findings of the Income Tax Officer and the preferred the findings of fact made by the Income Tax Officer. It observed \"At this stage, we may point out that the conclusion reached by the that the money was borrowed only for working expenses and not for capital investment proceeded on an inference based upon the balance-sheet. The did not investigate how the sum of Rs. 25 lakhs earlier borrowed from was actually utilised. Though in the order of the Income- tax Officer it is found stated that that amount was utilised on the capital assets of the company and that statement was based on the authority of the information furnished by the auditors of the assessee, the either overlooked or ignored this circumstance. In the face of the statement so recorded by the Income-tax Officer, the does not appear to have been justified in relying upon inferences in ascertaining whether the earlier borrowal was on capital or revenue account.\" ", "(1)6 I.T.C. 28. ", "948 ", " after reviewing various cases, observed : ", "\"If we ask for what purpose the expenditure in the present case was incurred, the only answer must be that it was incurred for the purpose of bringing into existence an asset in the shape of borrowing these Rs. 40 lakhs. The further question would then be whether this asset or advantage was not for the enduring benefit of the business and whether the expenditure incurred was one which was incurred once and for all. The answer to both questions would again be in the affirmative. It is true that the borrowed money has to be repaid and it cannot be an enduring advantage in the sense that the money becomes part of the assets of the company for all time to come. But, it certainly is an advantage which the company derives from the duration of the loan and undoubtedly it could not have been for any purpose other than an advantage to the business that the borrowing was made. That it is not enduring in the sense that the borrowing has to be repaid after a short or long period, as it were, cannot affect the conclusion that it was nevertheless an asset or an advantage that was secured. Viewed in the light of the tests adumbrated in the above decision (1) it seems to us that the expenditure must be regarded as capital expenditure. As the facts of the case which we have set out earlier indicate, there can be no doubt that at least to the extent of Rs. 25 lakhs that amount was expended for purposes of a capital nature, clearly in order to bring into existence capital assets. We have also pointed out that though it was vaguely stated by the that the other sum of Rs. 15 lakhs was utilised as working funds, there seems to be no material whatsoever before the to justify its coming to that conclusion.\" ", "The learned counsel for the assessee company, , urges that the expenditure is admissible as a deduction under s. 10(2) (xv) of the Act. He says that erred in holding that the expenditure was made to acquire any asset or advantage of an enduring nature within the test laid down by Viscount and approved by this Court in (1). He (1) 27 I.T.R. 34. ", "949 ", "further says that what was secured by the expenditure was a loan and in India money expended in raising a loan, whether by means of a debenture or a mortgage and whether you call it a loan capital or not, is not an expenditure in the nature of capital expenditure. He further submits that the expenditure was expended wholly and exclusively for the purpose of the business of the company. The learned counsel for the revenue, Mr. , supports the reasoning of . He says that was right in preferring the findings of the Income Tax Officer on the ground that there was no material for the finding made by and the finding was based on surmises and material evidence was ignored. He says that in a reference is entitled to ignore any findings of fact made by if those findings are vitiated. In the alternative, he says that the question referred is wide enough to include the question whether there was any material for the finding of . On the merits he contends that expenditure takes the colour from the thing on which the expenditure is made. If the money is spent to obtain capital then the expenditure assumes the nature of capital expenditure, but if the money is spent to obtain raw-materials then the expenditure takes the colour of revenue expenditure. He further says that the borrowed money is an enduring asset and any expenditure made to obtain this money falls within the test laid down by Viscount and approved by this Court. A number of cases have been referred to during the hearing of the case by both the counsel but we do not propose to refer to all of them. We must start first with the cases decided by this Court and see what principles have been laid down for distinguishing revenue expenditure from expenditure in the nature of capital expenditure, and especially those cases which dealt with similar problems. We will first consider (1). This was not a case arising under the Indian Income Tax Act but under the Madras Plantations Agricultural Income Tax Act, 1955, in which a section exactly similar to s. 10 (2) (xv) existed. In brief, the facts in that case were that the assessee had borrowed money for the purpose of purchasing the plantations and he claimed that in computing his agricultural income from these plantations the entire interest paid by him on moneys borrowed for the purpose of purchasing the plantation should be deducted as expenditure, under s. 5(e) of the Act. In (1) 8 S.C.R. 60 1 53 I.T.R. 186. ", "950 ", "the Madras Act there was no provision similar to S. 10(2) ", "(iii) of the Act and thus interest was not expressly deductible as an allowance. This applied the test formulated by Viscount ,, L. C., in ) and approved by the in (1), and held that the payment of interest was a revenue expenditure. It observed that \"no new asset is acquired with it; no enduring benefit is obtained. Expenditure incurred was part of circulating or floating capital of the assessee. In ordinary commercial practice payment of interest would not be termed as capital expenditure.\" This further held that the expenditure was for the purpose of business. Mr. tried to distinguish that case on the ground that what was at issue was interest on loan and not expenditure incurred for ,obtaining the loan. In our opinion, there is no justification for drawing this distinction in India. As observed by Lord in Scottish North American Trust v. Farmer(1) \"the interest is, in truth, money paid for the use or hire of an instrument of their trade as much as is the rent paid for their office or the hire paid for a typewriting machine. It is an outgoing by means of which the Company procured the use of the thing by which it makes a profit, and like any similar outgoing should be deducted from the receipts, to ascertain the taxable profits and gains which the Company earns. Were it otherwise they might be taxed on assumed profits when, in fact, they made a loss.\" ", "It will be remembered that there was no section like s. 10(2) (iii) of the Act in the English Income Tax Act. On the other hand, there were certain rules prohibiting the deduction in respect of \"any capital withdrawn from, or any sum employed or intended to be employed as capital in such trade. \" or \"any interest which might have been made if any such sums as aforesaid had been laid out at interest.\" Lord first held in that case that the express prohibitions did not apply to the facts of the case and then proceeded to discuss general principles. These observations show that where there is no express prohibition, an outgoing, by means of which an assessee procures the use of a thing by which it makes a profit, is deductible from the receipts of the business to ascertain taxable income. On the facts of this case, the money secured by the loan was the thing for the use of which this expenditure was made. In principle, apart from any statutory provisions, we see no distinction between interest in respect of a loan and an expenditure incurred for obtaining the loan. (1) 10 T.C. 155. (2) 1 S.C.R. 972 : 27 I.T.R. 34. ", "(3)5 T.C. 693 at 707. ", "951 ", "Mr. urges that these observations of Lord should be limited to a case where temporary borrowings are made. It is true that was dealing with the case of a company and the moneys that were borrowed were of a temporary character. But this fact was only relied on to hold that the moneys secured were not 'capital' within rule 3 of First Case, section 100 (5 and 6 Vic. Ch. 35) of the Income Tax Act , 1842, for Lord observed at p. 706; ", "\". . . it appears to me, simply, amounts to this that the word \"capital\" must, in this rule, be held to bear a wholly artificial meaning differing altogether from the ordinary signification, though there be no context in the clause requiring that there should be given to it a meaning different from that which it bears in ordinary commercial transactions.\" ", "He then referred to the decision in v. ) to show that the borrowing by a joint-stock company of money by the issue of debentures does not amount to an increasing of the capital of the company. ", " (2), this Court again examined the question of distinguishing between capital expenditure and revenue expenditure. ", "This Court first held that on the facts of the case, cl. ", "(iii) of s. 10(2) did not apply, because the assessee in that case had agreed to pay the balance of consideration due by the purchaser and this did not, in truth, give rise to a loan. Then , J., observed : ", "\"Whether a particular expenditure is revenue expenditure incurred for the purpose of business must be determined on a consideration of all the facts and circumstances, and by the application of principles of commercial trading. The question must 'be viewed in the larger context of business necessity or expediency. If the outgoing or expenditure is so related to the carrying on or conduct of the business, that it may be regarded as an integral part of the profit-earing process and not for acquisition of an asset or a right of a permanent character, the possession of which is a condition of the carrying on of the business, the expenditure may be regarded as revenue expenditure:' (1) 3 D.G. and J. 123. (2) [1965] 1 S.C.R. 770 : ", "56 I.T.R. 52 L8Sup. Cl/63-14 We will now briefly deal with relevant decisions of the High Courts. The first case referred is In re ) In that case, had incurred an expenditure of Rs. 28 lakhs as underwriting commission paid to underwriters on an issue of 7 lakhs preference shares of Rs. 100/- each and the company claimed to deduct this amount as expenses under S. 9 (2) ", "(ix) of the Indian Income Tax Act (VII of 1918). , C.J., observed: ", "\"If it is admitted that the cost of raising the original capital cannot be deducted from profit after the first year, it is dffficult to see how the cost of raising additional capital can be treated in a different way. Expenses incurred in raising capital are expenses of exactly the same character whether the capital is raised at the flotation of the company or thereafter : v. (2)\". ", "He further observed that \"as long as the law allows preliminary expenses and goodwill to be treated as assets, although of an intangible nature, the money so spent is in the nature of capital expenditure just as much as money spent in the purchase of land and machinery.\" The Chief Justice accordingly held that Rs. 28 lakhs could not be treated as expenditure (not in the nature of capital expenditure) solely incurred for the purpose of earning the profits of the company's business. , J., also came to the same conclusion, and he thought that the ratio decidendi in v. (2 ) and the principles underlying the decision in v. Watson(1) lent support to this conclusion. ", "At this stage it would be convenient to consider the Case of v. (2) relied on in this decision. We have already mentioned that the statute law in England is different from the law in India and the observations of the learned Judges in the English cases must be appreciated in the light of the background of the English Income Tax Act. In this case a mortgage company had raised money by the issue of debentures and debenture stock and incurred expenses for the issue of mortgage and placing of such debentures and debenture-stock. The Company claimed to deduct these expenses but held that the expenses could not be deducted under Schedule D of the English Income Tax Act as trading ex- (1) 1 I.T.C. 125. ", "(3) [1897] A.C. 1 (2) 3 T.C. 2S5. ", "953 ", "penses. , J., gave the following reasons for disallowing the claim: ", "\"The amount paid in order to raise the money on debentures, comes off the 'amount advanced upon the debentures, and, therefore, is so much paid for the cost of getting it, but there cannot be one law for a company having sufficient money to carry on all its operations and another which is content to pay for the accommodation. This appears to me to be entirely concluded by the decision of yesterday. ( v. Bell(1)\". ", "In the course of arguments, had remarked \"It is only so much capital. A man wants to raise pound 1 00,000 of capital, and in order to do that he has to pay pound-4,000. That makes the capital pound 96,000. That is all.\" ", "In reply to the argument of , Q.C., that \"the capital of the, company, properly-so-called, is the share capital\" , remarked : ", "\"To the extent that you borrow you increase the capital of the company.\" ", "In our opinion, if one keeps in mind the background of the English Income Tax Act, the observations reproduced above have no relevance to cases arising under the Indian Income Tax Act . In face of rule 3, Case 1, S. 100 (5 & 6 Vict. Ch. 35) prohibiting the deduction of any expenditure in respect of any sum employed or intended to be employed as capital, and , JJ. were only concerned with the question whether the amount secured by debentures and the amount obtained by the issue of debentures and debenture stock could be called capital employed or intended to be employed within the meaning of this rule. Rightly or wrongly, the English Courts have held that the amount obtained by the issue of debentures is capital employed within the meaning of the rule, but this does not give us any guidance in interpreting the words 'capital expenditure' occurring in s. 10 (2) (xv) of the Act. In our opinion, was wrong in relying on v. ). But we do not say that the Tata Iron and Steel (1) 3 T.C. 239. (2) 3 T.C. 255. ", "954 ", "Co. (1) case was wrongly decided. Obtaining capital by issue of shares is different from obtaining loan by debentures. ", "In v. Commissioner of Income Tax(1), , Nagpur, held that expenses for raising debenture loan required for changing the system of supplying current from D.C. to A.C. and for discharging a prior loan was not allowable as deduction of the company's assessable income. The Judicial Commissioner followed the case of v. ) and In re ). After referring to these two cases, the only additional reason given was that \"apart from authority it seems to us to stand to reason that money expended in obtaining capital must be treated as capital expendiure.\" With great respect we must hold that this case was wrongly decided. ", " in (4)held that the expenditure incurred by the company a capital expenditure and was 10(2)(xv). v. Jackson(5) Du#(1) and some other cases Madras(4) held that the expenditure raise a loan by debenture was therefore not deductible under s. relying on European investment and v. drew a distinction between the borrowing of capital and securing merely temporary or day-to-day accommodation or banking or trading facilities. According to , the expenses for borrowing capital could not be treated as revenue expenditure. This distinction may be valid in English Law but we are unable to appreciate how the distinction is valid under the Indian Income Tax Act . As the decision is mainly based on this distinction and relies inter alia on In re (\") and v. Commissioner of Income Tax (2 we must with respect hold that the case was wrongly decided. ", " Court relying on Texas Land and Mortgage Company V. William Holtham(3) and the decision in (4) held that on the facts and circumstances of that case, brokerage and commission of four annas on every maund of sugar paid by (2) 6 I.T.C. 28. (3) 3 T.C. 255. ", "(1) 1 I.T.C. 125. (4) 38 I.T.R. 533. ", "(5) 18 T.C. 1. (6) 24 T.C. 171. ", "(7) 47 I.T.R. 139. ", "955 ", "the assessee company was not revenue expenditure but capital expenditure. In our opinion, the derision, as far as the brokerage was concerned, was wrong, but we do not say anything in this case with respect to the decision as far as the commission on sale of goods was concerned. examined the question in great detail in (1), , J., held that the loan of Rs. 10 lakhs obtained by the company was an asset or advantage for the enduring benefit of the business of the assessee. He placed reliance on a number of cases,some of which we have already considered. But we are unable to agree that a loan obtained can be treated as an asset or advantage for the enduring benefit of the business of the assessee. A loan is a liability and has to be repaid and, in our opinion, it is erroneous to consider a liability as an asset or an advantage within the test laid down by Viscount and approved and applied by this in many cases. , J., after referring to a number of cases, felt that the raising of capital by issue of debentures was a recognised mode of raising capital and he felt that the decided cases had laid down the proposition that borrowing money by the issue of debentures was an acquisition of capital asset and that any commission or expenditure incurred in respect thereof was of a capital nature and not to be considered as in the nature of revenue. He was impressed by the fact that not a single case to the contrary was brought to his notice. But we have to decide the case on principle, and with respect it seems to us that he erred in treating the loan as equivalent to capital for the purpose of s. 10(2) (xv) of the Act. ", " of income Tax (2) held that the expenditure incurred for raising loan for the carrying on of a business cannot in all cases be regarded as an expenditure of a capital nature. On the facts of the case they held that as construction and sale of the building was the sole business of the firm and the building was its stock-intrade, and the loan was raised and used wholly for the purpose of acquiring this stock-in- trade and not for obtaining any fixed assets or raising any initial capital or for expansion of the assessee's business, the expenditure incurred for the raising of loan was not an expenditure of capital nature but revenue expenditure. Although the conclusion of was correct, we are not able to agree with the principle that the nature of the expenditure incurred in raising a loan would depend upon the nature and purpose of (1) 54 I.T.R. 592. (2) 57 I.T.R. 455. ", "956 ", "the loan. A loan may be intended to be used for the purchase of raw-material when it is negotiated, but the company may after raising the loan change its mind and spend it on securing capital assets. Is the purpose at the time the loan is negotiated to be taken into consideration or the purpose for which it is actually used ? Further suppose that in the accounting year the purpose is to borrow and buy raw- material but in the assessment year the company finds it unnecessary to buy raw-material and spends it on capital assets. Will the income tax officer decide the case with reference to what happened in the accounting year or what happened in the assessment year ? In our opinion, it was rightly held by the Nagpur Judicial Commissioner in v. Commissioner of Income Tax(1) that the purpose for which the new loan was required was irrelevant to the consideration of the question whether the expenditure for obtaining the loan was revenue expenditure or capital expenditure. ", "To summarise this part of the case, we are of the opinion that (a) the loan obtained is not an asset or advantage of an enduring nature; (b) that the expenditure was made for securing the use of money for a certain period-, and (c) that it is irrelevant to consider the object with which the loan was obtained. Consequently, in the circumstances of the case, the expenditure was revenue expenditure within S. 10(2)(xv) . ", "The last contention of Mr. is that even if it is revenue expenditure, it was not laid out wholly and exclusively for the purpose of business. , J., reviewed the case law in (1) and observed as follows : ", "\"The expression \"for the purpose of the business\" is wider in scope than the expression \"for the purpose of earning profits.\" Its range is wide : it may take in not only the day to day running of a business but also the rationalisation of its administration and modernization of its machinery; it may include measures for the preservation of the business and for the protection of its assets and property from expropriation, coercive process or assertion of hostile tide; it may also comprehend pay- ment of statutory dues and taxes imposed as a precondition to commence or for carrying on of a business; it may comprehend many other acts incidental to the carrying on of a business.\" ", "(1) 6 I.T.C. 28. (2) [1964] 7 S.C.R. 693: 53 I.T.R. 140. ", "957 ", "Mr. says that the act of borrowing money in this case was not 'incidental to the carrying on of a business. We are unable to accept this contention. (\") this Court held that , an investment company, when it borrowed money on debentures, the interest paid by it was incurred solely for the purpose of making or earning such income, profits or gains within the purview of S. 12(2) of the Indian Income Tax Act . It held on a review of the facts that the transaction was voluntarily entered into in order indirectly to facilitate the running of the business of the company and was made on the ground of commercial expediency. This case, in our opinion, directly covers the present case, although Mr. suggests that the case of an investment company stands on a different footing from the case of a manufacturing company. In some respects, their position may be different but in determining the question whether raising money is incidental to a business or not, we cannot discern any difference between an investment company and a manufacturing company. We may mention that in that case this Court was not considering whether the expenditure was in the nature of a capital expenditure or not, because it was agreed all through that the expenditure was not in the nature of capital expenditure, and the only question which this Court dealt with was whether the expenditure was incurred solely for the purpose of making or earning income, profits or gains. The case of (1) also supports the conclusion we have arrived at on this part of the case. It was held in that case that the payment of interest and a sum equivalent to 11/16th of the profits of the business of the assessee in pursuance of an agreement for obtaining loan from the lender were in a commercial sense expenditure wholly and exclusively laid out for the purpose of the assessees business and they were, therefore, deductible revenue expenditure. ", "Before we conclude we must deal with the point raised by Mr. that erred in law in preferring the findings of the Income Tax Officer to that of . It is not necessary to decide this question but it seems to us that in a reference must accept the findings of fact made by and it is for the person who has applied for a reference to challenge those findings first by an application under s. 66(1) . If he has. failed to file an application under (1) 20 I.T.R. 1. (2) 3 S.C.R. 359 : 42 I.T.R. 7. ", "958 ", "S.66(1) expressly raising the question about the validity of the findings of fact, he is not entitled to urge before that the findings are vitiated for one reason or the other. ", "To conclude we hold that the expenditure of Rs. 84,633/- was not in the nature of capital expenditure and was laid out or expended wholly and exclusively for the purpose of the assessee's business. The answer to the question referred, therefore, must be in the affirmative. The appeal is allowed, the judgment of set aside and the question referred answered in the affirmative. The appellant will have its costs incurred here and in . ", "Appeal allowed. ", "959"], "relevant_candidates": ["0000450105", "0000554839", "0000602365", "0000823444", "0000923991", "0001043522", "0001050499", "0001441230", "0001627616", "0001853481", "0184401603"]} {"id": "0000027891", "text": ["PETITIONER: UNION OF INDIA & ORS. ETC. ETC. Vs. RESPONDENT: . DATE OF JUDGMENT07/10/1983 BENCH: , R.S. BENCH: , R.S. , P.N. SEN, AMARENDRA NATH (J) CITATION: 1984 SCR (1) 347 1983 SCALE (2)449 ACT: Central Excises and Salt Act , 1944 -Old s. 4 prior to and new s. 4 after amendment by the Central Excises and Salt (Amendment) Act , 1973 -Interpretation of-Section validly enacted-Scheme and object of old s. 4 and new s. 4 are same. Mode of determining value of an article for excise levy-Value-Whether can be confined to manufacturing cost and manufacturing profit only-Whether post manufacturing expenses like freight, insurance and packing etc. can be included in the value of article. Central Excises and Salt Act , 1944-S. 4 (4) (c)- Definition of \"related person\"-Scope of. Definition not unduly wide-Does not suffer from constitutional infirmity. Words \"a relative and a distributor of the Assessee\" do not refer to any distributor but only to a distributor who is a relative of the assessee within the meaning of the Companies Act , 1956. Central Excises and Salt Act , 1944-S. 4 (4) (d)- 'Value'-Definition of-Scope of. Packing-Primary, secondary and special secondary-Cost of special secondary packing to be excluded from value. Constitution of India Art.246 , Schedule 7, List 1. Entry 84-Concept of duty of excise-What is. HEADNOTE: Sub-sec. (1) of sec. 3 of the Central Excises and Salt Act , 1944 provided that duties of excise shall be levied and collected on all excisable goods, other than salt which were produced or manufactured in India at the rates set-forth in the First Schedule. Sub-sec. (2) of sec. 3 empowered to fix, for the purpose of levying the duties, tariff values of the articles enumerated in the First Schedule as chargeable with duty ad valorem. Section 4 of the Act provided that the value of an article for the purposes of duty shall be (a) the wholesale cash price for which an article of the like kind and quality was sold or was capable of being sold at the time removal of the article chargeable with duty from the factory or any other premises of manufacture or production for delivery at the place of manufacture or production or (b) where such price was not ascertainable, the price at which an article of the like kind and quality was sold or was capable of being sold at the time of the removal of the article chargeable with duty from such factory or other premises for delivery at the place of manufacture or production. With the increase in the ad valorem levies in the Central Excise Tariff the operation of sec. 4 presented certain practical difficulties; some of which were prominently brought out in the judgment of this court in , 2 S.C.R. 1089. In that case, the inter alia said that 348 the real value of an article for the purposes of the excise levy would include only the manufacturing cost plus manufacturing profits. In order to overcome various difficulties, the original sec. 4 of the Act was substituted by a new sec. 4 by Act 22 of 1973. The new sec. 4 provided that the value of an article for the purposes of duty shall, subject to the other provisions of this section, be deemed to be the normal price thereof that is to say, the price at which such goods were ordinarily sold by the assessee to a buyer in the course of wholesale trade for delivery at the time and place of removal, where the buyer was not a related person and the price was the sole consideration for the sale and where the normal price of such goods was not ascertainable for the reason that such goods were not sold or for any other reason, the nearest ascertainable equivalent thereof determined in such manner as may be prescribed. Clauses (c) and (d) of sub-sec. (4) of sec. 4 defined \"related person\" and \"value\" respectively. The Central issue which arose between the and the assessees in these appeals was whether the value of an article for the purposes of the excise levy must be determined by reference exclusively to the manufacturing cost and the manufacturing profit of the manufacturer as contended by the assessees or should be represented by the entire wholesale price charged by the manufacturer which consisted of not merely his manufacturing cost and his manufacturing profit but included \"post manufacturing expenses\" and \"post manufacturing profit\" arising between the completion of the manufacturing process and the point of sale by the manufacturer. The other points of dispute were principally in respect of the connotation of the expression 'related person' in the new s.4 as well as the nature of the deductions which could be claimed by the assessee as post manufacturing expenses and post manufacturing profit from the price for the purpose of determining the \"value\". HELD: The question whether the value of an article for the purpose of the excise levy must be confined to the manufacturing cost and the manufacturing profit in respect of the article has to be answered in the negative. While the levy of excise duty is on the manufacture or production of goods, the stage of collection need not in point of time synchronize with the completion of the manufacturing process. While the levy in this country has the status of a constitutional concept, the point of collection is located where the statute declares it will be. [384 H, 364 F-G] The Central Provinces and Berar Sales of Motor Spirit and Lubricants Taxation Act, 1938, [1938-39] F.C.R. 18; , F.C.R. 90, 101; Governor-General in Council v. Province of Madras, F.C.R. 179; , Suppl. 3 S.C.R. 436; In Re. The Bill To Amend s. 20 of the Sea Customs Act, 1878, and s. 3 of the Central Excises And Salt Act, 1944, 3 S.C.R. 787; , Suppl. 1 S.C.R. 586; M/ v. State of Mysore & Ors., 1 S.C.R. 548; and v. , 3 S.C.R. referred to. The levy of a tax is defined by its nature, while the measure of the tax may be assessed by its own standard. It is true that the standard adopted as the 349 measure of the levy may indicate the nature of the tax but it does not necessarily determine it. When enacting a measure to serve as a standard for assessing the levy the legislature need not contour it along lines which spell out the character of the levy itself. A broader based standard of reference may be adopted for the purpose of determining the measure of the levy. Any standard which maintains a nexus with the essential character of the levy can be regarded as a valid basis for assessing the measure of the levy. The original s. 4 and the new s. 4 of the Central Excises and Salt Act satisfy this test. [366 C; 367 , F.C.R. 207; , A.I.R. 1952 Patna 359; , 1 S.C.R. 517; D.C. Gouse and Co. etc. v. The State of Kerala & Anr. etc., 1 S.C.R. 804; Searvai's Constitutional Law of India, Second Edition. Vol. 2 at page 1258; Re. A Reference under the Government of Ireland Act, 1920 and Sec. 3 of the Finance Act (Northern Ireland), 1934, L.R. 1936 A.C. 352; R.R. Engineering Co. v. ., 3 S.C.R. 1; and ., [1961} 2 S.C.R. 537 referred to. It was open to the legislature to specify the measure for assessing the levy. The legislature has done so. In both the old s. 4 and the new s. 4 the price charged by the manufacturer on a sale by him represents the measure. Price and sale are related concepts, and price has a definite connotation. The \"value\" of the excisable article has to be computed with reference to the price charged by the manufacturer, the computation being made in accordance with the terms of s. 4 . [368 D-E] On a true construction of its provisions in the context of the statutory scheme the old s. (4) (a) should be considered as applicable to the circumstances of the particular assessee himself and not of manufacturers generally.[381 C-D] Pursuant to the old s. 4 (a) the value of an excisable article for the purpose of the excise levy should be taken to be the price at which the excisable article is sold by the assessee to a buyer at arm's length in the course of wholesale trade at the time and place of removal. Where, however, the excisable article is not sold by the assessee in wholesale trade but, for example, is consumed by the assessee in his own industry the case is one where under the old s. 4 (a) the value must be determined as the price at which the excisable article or an article of the like kind and quality is capable of being sold in wholesale trade at the time and place of removal. [376 F-H] Where the excisable article or an article of the like kind and quality is not sold in wholesale trade at the place of removal, that is, at the factory gate, but is sold in the wholesale trade at a place out side the factory gate, the value should be determined as the price at which the excisable article is sold in the wholesale trade at such place, after deducting therefrom the cost of transportation of the excisable article from the factory gate to such place. [376 H; 77 A-B] 350 Where the wholesale price of the excisable article or an article of the like kind and quality is not ascertainable, then pursuant to the old s. 4 (b) the value of the excisable article shall be the price at which the excisable article or an article of the like kind and quality is sold or is capable of being sold by the assessee at the time and place of removal or if the excisable article is not sold or is not capable of being sold at such place, then the price at which it is sold or is capable of being sold by the assessee at any other place nearest thereto. [377 B-C] In every case the fundamental criterion for computing the value of an excisable article is the price at which the excisable article or an article of the like kind and quality is sold or is capable of being sold by the manufacturer and it is not the bare manufacturing cost and manufacturing profit which constitutes the basis for determining such value. [377 for India in Council L.R. 59 I.A. 258; for India in Council, L.R. 65 I.A. 32; and ., 3 S.C.R. 563, referred to. The basic scheme for determination of the price in the new s. 4 is characterised by the same dichotomy as that observable in the old s. 4. It was not the intention of , when enacting the new s. 4 to create a scheme materially different from that embodied in the superseded s. 4 . The object and purpose remained the same, and so did the central principle at the heart of the scheme. The new scheme was merely-more comprehensive and the language employed more precise and definite. As in the old s. 4 , the terms in which the value was defined remained the price charged by the assessee in the course of wholesale trade for delivery at the time and place of removal. [377 H; 378 A-B] It is not possible to conceive of the price under the new s. 4 (1) (a) being confined to the manufacturing cost and the manufacturing profit. Moreover, it is reasonable to suppose that the central principle for the determination of the value of the excisable article should be the same, whether the case falls under cl. (a) or cl. (b) of the old s. 4 or under the new s. 4 (1). When regard is had to the provision of cl. (b) in each case, it is not possible to limit the price to its components representing the manufacturing cost and manufacturing profit. [379 E-G] The contention that the provisions regarding related persons are wholly unnecessary because to counter act evasion of tax any artificially arranged price between the manufacturer and his wholesale buyer can be rejected in any case under s. 4 is not acceptable. The new s. 4 (1) contains inherently within it the power to determine the true value of the excisable article, after taking into account any concession shown to a special or favoured buyer because of extra-commercial consideration, in order that the price be ascertained only on the basis that it is a transaction at arm's length. That requirement is emphasised by the provision in the news. 4 (1) (a) that the price should be the sole consideration for the sale. In every such case, it will 351 be for the to determine on the evidence before it whether the transaction is one where extra-commercial considerations have entered and, if so, what should be the price to be taken as the value of the excisable article for the purpose of excise duty. Nonetheless it was open to to incorporate provisions in the section declaring that certain specified categories of transactions fall within the tainted class, in which case an irrebuttable presumption will arise that transactions belonging to those categories are transactions which cannot be dealt with under the usual meaning of the expression \"normal price\" set forth in the new s. 4 (1) (a). They are cases where it will not be necessary for the to examine the entire gamut of evidence in order to determine whether the transaction is one prompted by extra-commercial considerations. It will be open to the , on being satisfied that the third provision to the new s. 4 (1) (a) read with the definition of \"related person\" in s. 4 (4) (c) is attracted, to proceed to determine the \"value\" in accordance with the terms of the third proviso. [385 F-H; 386 A-D] The argument that the assessment on the manufacturer by reference to the sale price charged by his distributor is \"wholly incompatible with the nature of excise\" has no force. It is a well known legislative practice to enact provisions in certain limited cases where an assessee may be taxed in respect of the income or property truly belonging to another. They are cases where the intervenes to prevent the circumvention of the tax obligation by tax payers seeking to avoid or reduce their tax liability through modes resulting in the income or property arising to another. The provisions of the law may be so enacted that the actual existence of such motive may be wholly immaterial, even if what has been done by the assessee may proceed from wholly bona fide intention. With the aid of a legal fiction, the fastens the liability on the assessee. When the employs such a device, and the liability is attached without qualification, it is reasonable to infer that an irrebuttable presumption has been created by law. Such provisions have been held to be within the legislative competence of the and as falling within its power of taxation. [386 , 2 S.C.R. 938; tax. 'D' Range, 1 S.C.R. 909; , 3 S.C.R. 1, referred to. The argument that the definition of the expression \"related person\" is so arbitrary that it includes within it a distributor of the assessee is also without much force. The provision in the definition of \"related person\" relating to a distributor can be legitimately read down and its validity upheld. The definition of related person should be so read that the words \"a relative and a distributor of the assessee\" should be understood to mean a distributor who is a relative of the assessee. The Explanation to s. 4 (4) (c) provides that the expression \"relative\" has the same meaning as in the Companies Act , 1956. The definition of \"related person ', as being \"a person who is so associated with the assessee that they have interest, directly or indirectly, in the business of each other and includes a holding company, a subsidiary company ..,\" shows a sufficiently restricted basis for employing the legal fiction. Here again, 352 regard must be had to the Explanation which provides that the expression \"holding company and subsidiary\" have the same meanings as in the Companies Act , 1956. It is well settled that in a suitable case the court can lift the corporate veil where the companies share the relationship of a holding company and a subsidiary company and also to pay regard to the economic realities behind the legal facade, [387 B-H; 388 . 6 S.C.R. 885; . 1 S.C.R. 988, referred to. The true position under the Central Excises and Salt Act 1944 as amended by Act XXII of 1973 is as follows: (i) The price at which the excisable goods are ordinarily sold by the assessee to a buyer in the course of wholesale trade for delivery at the time and place of removal as defined in subsection (4) (b) of section 4 is the basis for determination of excisable value provided, of course, the buyer is not a related person within the meaning of sub- section (4) (c) of section 4 and the price is the sole consideration for the sale. The proposition is subject to the terms of the three provisos to sub-section (1) (a) of section 4 . [388 D-F] (ii) Where the price of excisable goods in the course of wholesale trade for delivery at the time and place of removal cannot be ascertained for the reason that such goods are not sold or for any other reason, the nearest ascertainable equivalent thereof determined in the manner prescribed by the Central Excise (Valuation) Rules, 1975 should be taken as representing the excisable value of the goods; [388 G-H] (iii)Where wholesale price of any excisable goods for delivery at the place of removal is not known and the value thereof is determined with reference to the wholesale price for delivery at a place other than the place of removal, the cost of transportation from the place of removal to the place of delivery should be excluded from such price; [389 A-B] (iv) Of course, these principles cannot apply where the tariff value has been fixed in respect of any excisable goods under sub-section (2) of section 3 ; [389 C] (v) On a proper interpretation of the definition of 'related person' in sub-section (4) (c) of section 4 the words \"a relative and a distributor of the assessee\" do not refer to any distributor but they are limited only to a distributor who is a relative of the 353 assessee within the meaning of the Companies Act , 1956. So read, the definition of 'related person' is not unduly wide and does not suffer from any constitutional infirmity. It is within the legislative competence of . It is only when an assessee so arranges that the goods are generally not sold by him in the course of wholesale trade except to or through such a related person that the price at which the goods are ordinarily sold by the related person in the course of wholesale trade at the time of removal to dealers (not being related persons) or where such goods are not sold to such dealers, to dealers (being related persons) who sell such goods in retail is liable to be taken as the excisable value of the goods under proviso (iii) to sub-section (1) (a) of section 4 . [389 D-F] For the purpose of determining the \"value\", broadly speaking both old s. 4 (a) and the new s. 4 (1) (a) speak of the price for sale in the course of wholesale trade of an article for delivery at the time and place of removal, namely, the factory gate. Where the price contemplated under the old s. 4 (a) or under new s. 4 (1) (a) is not ascertainable, the price is determined under the old s. 4 (b) or the new s. 4 (1) (b). Now, the price of an article is related to its value (using this term in a general sense), and into that value have poured several components, including those which have enriched its value and given to the article its marketability in the trade. Therefore, the expenses incurred on account of the several factors which have contributed to its value upto the date of sale, which apparently would be the date of delivery, are liable to be included. Consequently, where the sale is effected at the factory gate, expenses incurred by the assessee upto the date of delivery on account of storage charges, outward handling charges, interest on inventories (stocks carried by the manufacturer after clearance), charges for other services after delivery to the buyer, namely after-sales service and marketing and selling organisation expenses including advertisement expenses marketing and selling organisation expenses and after-sales service promote the marketability of the article and enter into its value in the trade. Where the sale in the course of wholesale trade is effected by the assessee through its sales organisation at a place or places outside the factory gate, the expenses incurred by the assessee upto the date of delivery under the aforesaid heads cannot, on the same grounds, be deducted. [391 C-H] The assessee will be entitled to a deduction on account of the cost of transportation of the exciseable article from the factory gate to the place or places where it is sold. The cost of transportation will include the cost of insurance on the freight for transportation of the goods from the factory gate to the place or places of delivery. [391 H; 392 A] Where freight is averaged and the averaged freight is included in the wholesale cash price so that the wholesale cash price at any place or places outside the factory gate is the same as the wholesale cash price at the factory gate, the averaged freight included in such wholesale cash price has to be deducted in order to arrive at the real wholesale cash price at the factory gate and no excise duty can be charged on it. [392 A-B] 354 The new s. 4 (4) (d) (i) has made express provision for including the cost of packing in the determination of \"value\" for the purpose of excise duty. The packing, of which the cost is included, is the packing in which the goods are wrapped, contained or wound when the goods are delivered at the time of removal. The cost of primary packing, that is to say, the packing in which the article is contained and in which it is made marketable for the ordinary consumer, must be regarded as falling within s. 4 (4) (d) (i). There is secondary packing which consists of larger cartons in which a standard number of primary cartons (in the sense mentioned earlier) are packed. The large cartons may be packed into even larger cartons for facilitating the easier transport of the goods by the wholesale dealer. Is all the packing, no matter to what degree, in which the wholesale dealer takes delivery of the goods to be considered for including the cost thereof in the \"value\" ? Or does the law require a line to be drawn somewhere ? One must remember that while packing is necessary to make the excisable article, marketable, the statutory provision calls for strict construction because the levy is sought to be extended beyond the manufactured article itself. If seems to us that the degree of secondary packing which is necessary for putting the excisable article in the condition in which it is generally sold in the wholesale market at the factory gate is the degree of packing whose cost can be included in the \"value\" of the article for the purpose of the excise levy. To that extent, the cost of secondary packing cannot be deducted from the wholesale cash price of the excisable article at the factory gate. [392 C; 392 G-H; 393 A-E] If any special secondary packing is provided by the assessee at the instance of a whole-sale buyer which is not generally provided as a normal feature of the wholesale trade, the cost of such packing shall be deducted from the wholesale cash price. [393 F] JUDGMENT: ", "CIVIL APPELLATE JURISDICTION: Civil Appeal No. 2269 of 1980 etc. From the Judgment and order dated 30.7.80 of in Appeal No. 252/1980 etc. , , Dr. , , , , , , , , , , , , , , and for the Appellants Petitioners. ", ", , , , D.B. Engineer, , , , Mrs. , , Miss , , and for the Respondents. ", "355 ", "The udgment of the Court was delivered by . : On May 9, 1983 we made an order setting forth the legal position in respect of various aspects of the levy of excise duty under the Central Excises and Salt Act , 1944, both before its amendment by the Central Excises and Salt (Amendment) Act . 1973 (Act XXII of 1973) and after such amendment. We record now the reasons for that order. ", "At the outset, we may state that it is not possible in this judgment to deal with the numerous individual appeals, writ petitions, special leave petitions and transferred cases before us on the particular facts of each, and we propose to consider the points arising therein from a general perspective. ", "The Central Excises and Salt Act , 1944 relates to central duties of excise and to salt. Sub-s. (1) of s.3 provides that duties of excise shall be levied and collected on all excisable goods, other than salt, which are produced or manufactured in India, at the rates set forth in the First Schedule. We are not concerned with the provision relating to salt. Sub-s. (2) empowers to fix, for the purpose of levying the duties, tariff values of the articles enumerated in the First Schedule as chargeable with duty ad valorem. ", "Before its amendment by Act XXII of 1973 s.4 read as follows: ", "\"4. Determination of value for the purposes of duty.- Where, under this Act, any article is chargeable with duty at a rate dependent on the value of the article, such value shall be deemed to be- ", "(a) the wholesale cash price for which an article of the like kind and quality is sold or is capable of being sold at the time of the removal of the article chargeable with duty from the factory or any other premises of manufacture or production for delivery at the place of manufacture or production, or if a wholesale market does not exist for such article at such place, at the nearest place where such market exists, or ", "(b) where such price is not ascertainable, the price at which an article of the like kind and quality is sold or is capable of being sold by the manufacturer or producer, or his agent, at the time of the removal of the article chargeable with duty from such factory or other premises for delivery at the place of manufacture or production, or if such article is not sold or is not capable of being sold at such place, at any other place nearest thereto. ", "Explanation-In determining the price of any article under this section, no abatement or deduction shall be allowed except in respect of trade discount and the amount of duty payable at the time of the removal of the article chargeable with duty from the factory or other premises aforesaid.\" ", "It seems that with the increase in the ad valorem levies in the Central Excise Tariff the operation of s.4 presented certain practical difficulties, some of which were prominently brought out in the judgment of this in . Among other observations the appears to have said that the real value of an article for the purposes of the excise levy would include only the manufacturing cost plus the manufacturing profit. In order to overcome the various difficulties, enacted Act XXII of 1973 which substituted a new s.4 for the original Provision with effect from October 1, 1975. The new section 4 provides:- ", "\"4. Valuation of excisable goods for purposes of charging of duty of excise.-(1) Where under this Act, the duty of excise is chargeable on any excisable goods with reference to value, such value shall, subject to the other provisions of this section be deemed to be- ", "(a) the normal price thereof, that is to say, the price at which such goods are ordinarily sold by the assessee to a buyer in the course of wholesale trade for delivery at the time and place of removal, where the buyer is not a related person and the price is the sole consideration for the sale: ", "Provided that- ", "(i) where in accordance with the normal practice of the wholesale trade in such goods, such goods are sold by the assessee at different prices to different classes of buyers (not being related persons) each such price, shall, subject to the existence of the other circumstances specified in clause (a), be deemed to be the normal price of such goods in relation to each such class of buyers; ", "(ii) where such goods are sold by the assessee in the course of wholesale trade for delivery at the time and place of removal at a price fixed under any law for the time being in force, or at a price, being the maximum fixed under any such law, then, notwithstanding anything contained in cl. (iii) of this proviso the price or the maximum price, as the case may be, so fixed shall, in relation to the goods so sold, be deemed to be the normal price thereof; ", "(iii)where the assessee so arranges that the goods are generally not sold by him in the course of wholesale trade except to or through a related person, the normal price of the goods sold by the assessee to or through such related person shall be deemed to be the price at which they are ordinarily sold by the related person in the course of wholesale trade at the time of removal, to dealers (not being related persons) or where such goods are not sold to such dealers, to dealers (being related persons) who sell such goods in retail; ", "(b) where the normal price of such goods is not ascertainable for the reason that such goods are not sold or for any other reason, the nearest ascertainable equivalent thereof determined in such manner as may be prescribed. ", "(2) Where, in relation to any excisable goods the price thereof for delivery at the place of removal is not known and the value thereof is determined with reference to the price for delivery at a place other than the place of removal, the cost of transportation from the place of removal, to the place of delivery shall be excluded from such price. ", "358 ", "(3) The provisions of this section shall not apply in respect of any excisable goods for which a tariff value has been fixed under sub-section (2) of Section ", "3. (4) or the purposes of this section.- ", "(a) \"assessee\" means the person who is liable to pay the duty of excise under this Act and includes his agent; ", "(b) \"place of removal\" means- ", "(i) a factory or any other place or premises of production or manufacture of the excisable goods; or ", "(ii) a warehouse or any other place or premises wherein the excisable goods have been permitted to be deposited without payment of duty, from where such goods are removed; ", "(c) \"related person\" means a person who is so associated with the assessee that they have interest, directly or indirectly, in the business of each other and includes a holding company, a subsidiary company, a relative and a distributor of the assessee, and any sub-distributor of such distributor. ", "Explanation.-In this clause \"holding company\", \"a subsidiary company\" and \"relative\" have the same meanings as in the Companies Act , 1956; ", "(d) \"value\", in relation to any excisable goods.- ", "(i) where the goods are delivered at the time of removal in a packed condition, includes the cost of such packing except the cost of the packing which is of a durable nature and is returnable by the buyer to the assessee. ", "359 ", "Explanation.-In this sub-clause \"packing\" means the wrapper, container, bobbin, pirn, spool, reel or warp beam or any other thing in which or on which the excisable goods are wrapped. contained or wound; ", "(ii) does not include the amount of the duty of excise, sales tax and other taxes, if any, payable on such goods and, subject to such rules as may be made, the trade discount (such discount not being refundable on any account whatsoever) allowed in accordance with the normal practice of the wholesale trade at the time of removal in respect of such goods sold or contracted for sale; ", "(e) \"wholesale trade\" means sales to dealers, industrial consumers, local authorities and other buyers, who or which purchase their requirements otherwise than in retail.\" ", "In the cases before us there has been considerable debate on the true meaning and scope of s.4 before and after its amendment. The points raised are not without difficulty, but we have had the advantage of hearing counsel of eminence on both sides, and we are grateful to them for the considerable assistance they have given us throughout the hearing of these cases. ", "The central issue between the parties is whether the value of an article for the purposes of the excise levy must be determined by reference exclusively to the manufacturing cost and the manufacturing profit of the manufacturer or should be represented by the entire wholesale price charged by the manufacturer. The wholesale price actually charged by the manufacturer consists of not merely his manufacturing cost and his manufacturing profit but includes, in addition, a whole range of expenses and an element of profit (conveniently referred to as \"post manufacturing expenses\" and \"post manufacturing profit\") arising between the completion of the manufacturing process and the point of sale by the manufacturer. ", "Mr. , learned counsel for the assessees, has propounded three principles which, he contends, form the essential characteristics of a duty of excise. Firstly, he says, excise is a tax on manufacture or production and not on anything else. Secondly, uniformity of incidence is a basic characteristic of excise. And thirdly, the exclusion of post manufacturing expenses and post manufacturing profits is necessarily involved in the first principle and helps to achieve the second. Learned counsel urges that where excise duty is levied on an ad valorem basis the value on which such duty is levied is a \"conceptual value\", and that the conceptual nature is borne out by the circumstance that the identity of the manufacturer and the identity of the goods as well as the actual wholesale price charged by the manufacturer are not the determining factors. It is urged that the old s.4 ", "(a) clearly indicates that a conceptual value forms the basis of the levy, and that the actual wholesale price charged by the particular assessee cannot be the basis of the excise levy. It is said that the criterion adopted in clause (a) succeeds in producing uniform taxation, whether the assessees are manufacturers who sell their goods in wholesale, semi-wholesale or in retail, whether they have a vast selling and marketing net work or have none, whether they sell at depots and branches or sell at the factory gate, and whether they load the ex-factory price with post manufacturing expenses and profits or do not do so. Because the value of the article rests on a conceptual base, it is urged, the result of the assessment under s.4 (a) cannot be different from the result of an assessment under s 4 (b). The contention is that the principle of uniformity of taxation requires the exclusion of post manufacturing expenses and profits, a factor which would vary from one manufacturer to another. It is pointed out that such exclusion is necessary to create a direct and immediate nexus between the levy and the manufacturing activity, and to bring about a uniformity in the incidence of the levy. Learned counsel contends that the position is the same under the new s.4 which, he says, must needs be so because of the fundamental nature of the principles propounded earlier. Referring to the actual language of the new s.4 (1) (a), it is pointed out that the expression \"normal price\" therein means \"normal for the purposes of excise\", that is to say, that the price must exclude post manufacturing expenses and post manufacturing profit and must not be loaded with any extraneous element. It is conceded, however, that under the new s.4 (1) (a) there is no attempt to preserve uniformity as regards the amount of duty between one manufacturer and another, but it is urged that the basis on which the value is determined is constituted by the same conceptual criterion, that post manufacturing expenses and post manufacturing profit must be excluded. Considerable emphasis has been laid on the submission that as excise duty is a tax on the manufacture or production of goods it must be a tax intimately linked with the manufacture or production of the excisable article and, therefore, it can be imposed only on the assessable value determined with reference to the excisable article at the stage of completed manufacture and to no point beyond. To preserve this intimate link or nexus between the nature of the tax and the assessment of the tax, it is urged that all extraneous elements included in the \"value\" in the nature of post manufacturing expenses and post manufacturing profits have to be off-loaded. It is pointed out that factors such as volume, quantity and weight, which enter into the measure of the tax, are intimately linked with the manufacturing activity, and that the power of under Entry 84 of List I of the Seventh Schedule to the Constitution to legislate in respect of \"value\" is restricted by the conceptual need to link the basis for determining the measure of the tax with the very nature of the tax. ", ", the learned Solicitor General of India (when these cases were heard), and now the Attorney General of India) has strongly contended that the value of an excisable article for the purposes of the levy must be taken at the price charged by the manufacturer on a wholesale transaction, the computation being made strictly in terms of the express provisions of the statute and, he says, there is no warrant for confining the value to the assessee's manufacturing cost plus manufacturing profit. According to him, although excise is a levy on the manufacture of goods, it is open to to adopt any basis for determining the value of an excisable article, that the measure for assessing the levy need not correspond completely to the nature of the levy, and no fault can be found with the measure so long as it bears a nexus with the charge. ", "Besides this fundamental issue, there are other points of dispute, principally in respect of the connotation of the expression \"related person\" in the new s.4 as well as the nature of the deductions which can be claimed by the assessee as post manufacturing expenses and post manufacturing profit from the price for the purpose of determining the \"value\". ", "The submissions made by learned counsel for the parties in support of their respective contentions cover a wide area, and several questions of a fundamental nature have been raised. We consider it necessary to deal with them because they enter into and determine the conclusions reached by us. ", "362 ", "We think it appropriate that at the very beginning we should briefly indicate the concept of a duty of excise. Both Entry 45 of List I of the Seventh Schedule to the Government of India Act, 1935, under which the original Central Excises and Salt Act was enacted, and Entry 84 of List I of the Seventh Schedule to the Constitution under which the Amendment Act of 1973 was enacted, refer to \"Duties of excise on.......goods manufactured or produced in India\". A duty of excise, according to in The Central Provinces and Berar Sales of Motor Spirit and Lubricants Taxation Act, 1938 is a duty ordinarily levied on the manufacturer or producer in respect of the manufacture or production of the commodity taxed. A distinction was drawn between the nature of the tax and the point at which it was collected, and observed that theoretically \"there can be no reason why an excise duty should not be imposed even on the retail sale of an article, if the taxing Act so provides. Subject always to the legislative competence of the taxing authority, a duty on home-produced goods will obviously be imposed at the stage which the authority find to be most convenient and the most lucrative, wherever it may be; but that is a matter of the machinery of collection, and does not affect the essential nature of the tax. The ultimate incidence of an excise duty, a typical indirect tax, must always be on the consumer, who pays as he consumes or expends; and it continues to be an excise duty, that is, a duty on home-produced or home-manufactured goods, no matter at what stage it is collected\" (emphasis supplied). The position was explained further in The Province of Madras v. Messers. where observed:- ", "\"There is in theory nothing to prevent from imposing a duty of excise on a commodity as soon as it comes into existence, no matter what happens to it afterwards, whether it be sold, consumed, destroyed, or given away. A taxing authority will not ordinarily impose such a duty, because it is much more convenient administratively to collect the duty (as in the case of most of the Indian Excise Acts) when the commodity leaves the factory for the first time, and also because the duty is intended to be an indirect duty which the manufacturer or producer is to pass on to the ultimate consumer, which he could not do if the commodity had, for example, been destroyed in the factory itself. It is the fact of manufacture which attracts the duty, even though it may be collected later.\" ", "The observations show that while the nature of an excise is indicated by the fact that is imposed in respect of the manufacture or production of an article, the point at which it is collected is not determined by the point of time when its manufacture is completed but will rest on considerations of administrative convenience, and that generally it is collected when the article leaves the factory for the first time. In other words, the circumstance that the article becomes the object of assessment when it is sold by the manufacturer does not detract from its true nature, that it is a levy on the fact of manufacture. In a subsequent case, Governor-General in Council v. , referred to both in The Central Provinces and Berar Sales of Motor Spirit and Lubricants Taxation Act, 1938 (supra) and The v. . and Sons (supra) and affirmed that when excise was levied on a manufacturer at the point of the first sale by him \"that may be because the taxation authority imposing a duty of excise finds it convenient to impose that duty at the moment when the excisable article leaves the factory or workshop for the first time on the occasion of its sale. But that method of collecting the tax is an accident of administration; it is not of the essence of the duty of excise, which is attracted by the manufacture itself.\" This Court had occasion to consider a similar question in . In that case, was authorised by an ordinance to levy and collect as a cess on coal and coke despatched from collieries in British India duty of excise at a specified rate. Rule 3 made under Ordinance empowered the Government to impose a duty of excise on coal and coke when such coal and coke was despatched by rail from the collieries of the coke plants, and the duty was to be collected by by means of a surcharge on freight either from the consignor or consignee. It was contended by the assessee that the excise duty could not legally be levied on the consignee who had nothing to do with the manufacture or production of coal. The Court remarked: ", "\"The argument confuses the incidence of taxation with the machinery provided for the collection thereof,\" ", "364 ", "and reference was made to In re. the Central Provinces and Berar Act No. XIV of 1938 (supra), and Sons (supra) and Governer-General in v. (supra). This then summarised the law as follows:- ", "\"Excise duty is primarily a duty on the production or manufacture of goods produced or manufactured within the country. It is an indirect duty which the manufacturer or producer passes on to the ultimate consumer, that is, its ultimate incidence will always be on the consumer. Therefore, subject always to the legislative competence of the taxing authority, the said tax can be levied at a convenient stage so long as the character of the impost, that is, it is a duty on the manufacture or production, is not lost. The method of collection does not affect the essence of the duty, but only relates to the machinery of collection for administrative convenience.\" ", "Other cases followed where the nature of excise duty was reaffirmed in the terms set out earlier, and reference may be made to In Re. The Bill To Amend S. 20 of the Sea Customs Act, 1878, and S. 3 of the Central Excises And Salt Act, 1944, . v. and etc. v. . ", "We think we have shown sufficiently that while the levy is on the manufacture or production of goods, the stage of collection need not in point of time synchronize with the completion of the manufacturing process. While the levy in our country has the status of a constitutional concept, the point of collection is located where the statute declares it will be. We shall return to this later when it is necessary to consider a submission in regard to the effect of transactions to or through \"related persons\". ", "We move on now to a different dimension, to the conceptual consideration of the measure of the tax. S. 3 of the Central Excises and Salt Act provides for the levy of the duty of excise. It creates the charge, and defines the nature of the charge. That it is a levy on excisable goods, produced or manufactured in India, is mentioned in terms in the section itself. Section 4 of the Act provides the measure by reference to which the charge is to be levied. The duty of excise is chargeable with reference to the value of the excisable goods, and the value is defined in express terms by that section. It has long been recognised that the measure employed for assessing a tax must not be confused with the nature of the tax. Court held that a tax on buildings under s. 3 of the Punjab Urban Immovable Property Tax Act, 1940 measured by a percentage of the annual value of such buildings remained a tax on buildings under that Act even though the measure of annual value of a building was also adopted as a standard for determining income from property under the Income Tax Act . It was pointed out that although the same standard was adopted as a measure for the two levies, the levies remained separate and distinct imposts by virtue of their nature. In other words, the measure adopted could not be identified with the nature of the tax. The distinction was observed by a Special Bench of in where a tax on passengers and goods was assessed as a rate on the fares and freights payable by the owners of the motor vehicles. (supra) was referred to with approval by this Court in . This Court in that case repelled the contention that the levy was a tax upon income and not upon passengers and goods. It pointed out that \"though the measure of the tax is furnished by the fares and freights it does not cease to be a tax on passengers and goods\". The point was considered by this Court again in v. State of Kerala & Anr. etc. where reference was made to the measure adopted for the purpose of the levy of tax on buildings under the Kerala Building Tax Act. The Court examined the different modes available to the for measuring the levy, and upheld the action of the in linking the levy with the annual value of the building and prescribing a uniform formula for determining its capital value and for calculating the tax. In the course of its judgment, the Court cited with approval a passage from Seervai's Constitutional Law of India. ", "366 ", "\"Another principle for reconciling apparently conflicting tax entries follows from the fact that a tax has two elements: the person, thing of activity on which the tax is imposed, and the amount of the tax. The amount may be measured in may ways; but decided cases establish a clear distinction between the subject matter of a tax and the standard by which the amount of tax is measured. These two elements are described as the subject of a tax and the measure of a tax.\" ", "It is, therefore, clear that the levy of a tax is defined by its nature, while the measure of the tax may be assessed by its own standard. It is true that the standard adopted as the measure of the levy may indicate the nature of the tax but it does not necessarily determine it. The relationship was aptly expressed by the Privy council in Re. A Reference under the Government of Ireland Act, 1920 and Sect. 3 of the Finance Act (Northern Ireland), 1934 when it said:- ", "\"......It is the essential characteristic of the particular tax charged that is to be regarded, and the nature of the machinery-often complicated-by which the tax is to be assessed is not of assistance, except in so far as it may throw light on the general character of the tax.\" ", "The case was referred to by a Constitution Bench of this Court in ., where the relationship was succinctly described thus:- ", "\"It may be, and is often so, that the tax on circumstances and property is levied on the basis of income which the assessee receives from his profession, trade, calling or property. That is, however, not conclusive on the nature of the tax. It is only as a matter of convenience that income is adopted as a yardstick or measure for assessing the tax. As pointed out in Re. a Reference under Govt. of Ireland Act (supra), the measure of the tax is not a true test of the nature of the tax. Therefore, while determining the nature of a tax, though the standard on which the tax is levied may be a relevant consideration, it is not a conclusive consideration.\" ", "367 ", "The principle was reaffirmed by this Court in where the form in which the levy was imposed was held to be and impermissible test for defining in itself the character of the levy. It was observed:- ", "\".....the mere fact that the levy imposed by the impugned Act had adopted the method of determining the rate of the levy by reference to the minerals produced by the mines would not by itself make the levy a duty of excise. The method thus adopted may be relevant in considering the character of the impost but its effect must be weighed along with and in the light of the other relevant circumstances.\" ", "It is apparent, therefore, that when enacting a measure to serve as a standard for assessing the levy the need not contour it along lines which spell out the character of the levy itself. Viewed from this standpoint, it is not possible to accept the contention that because the levy of excise is a levy on goods manufactured or produced the value of an excisable article must be limited to the manufacturing cost plus the manufacturing profit. We are of opinion that a broader based standard of reference may be adopted for the purpose of determining the measure of the levy. Any standard which maintains a nexus with the essential character of the levy can be regarded as a valid basis for assessing the measure of the levy. In our opinion, the original s.4 and the new s.4 of the Central Excises and Salt Act satisfy this test. ", "S.4 envisages a method of collecting tax at the point of the first sale effected by the manufacturer. Under the old s.4 (a), the value of the excisable article was deemed to be the wholesale cash price for which an article of the like kind and quality was sold, or was capable of being sold, at the time of the removal of the article chargeable with duty from the factory or any other premises of manufacture or production for delivery at the place of manufacture or production, or if a wholesale market did not exist for such article at such place, then delivery was envisaged at the nearest place where such market existed. Sec.4 (b) declared that where such price was not ascertainable, the value would be deemed to be the price to be the price at which an article of the like kind and quality was sold or was capable of being sold by the manufacturer or producer, or his agent, at the time of the removal of the article chargeable with duty from such factory or other premises for delivery at the place of manufacture or production, and if such article was not sold or was not capable of being sold at such place, at any other place nearest thereto. Then there was an explanation which declared that no abatement or deduction would be allowed except in respect of trade discount and the duty payable at the time of the removal of the article from the factory. The wholesale price was envisaged as a cash price in order to make it a uniform standard, because it was then a price freed from the burden of an increase on account of credit or other advantage allowed to a buyer, a factor which may vary from transaction to transaction and from buyer to buyer. The essential distinction between cl. (a) and cl. (b) of s.4 appears to lie in this, that cl. (a) is invoked when the wholesale cash price is ascertainable and cl. (b) when the wholesale cash price cannot be ascertained. ", "As we have said, it was open to the to specify the measure for assessing the levy. The has done so. In both the old s.4 and the new s.4, the price charged by the manufacturer on a sale by him represents the measure. Price and sale are related concepts, and price has a definite connotation. The \"value\" of the excisable article has to be computed with reference to the price charged by the manufacturer, the computation being made in accordance with the terms of s.4. ", "A contention was raised for some of the assessees, that the measure was to be found by reading s.3 with s.4, thus drawing the ingredients of s.3 into the exercise. We are unable to agree. We are concerned with s.3(1), and we find nothing there which clothes the provision with a dual character, a charging provision as well as a provision defining the measure of the charge. ", "At this stage, it would be advantageous to refer to certain decisions which have some bearing on the proper construction of cl. (a) and cl. (b) of the old s.4. ", " for India in Council had to construe the scope of s.30 of the Sea Customs Act, 1878 which contained cls. (a) and (b) substantially comparable with the two clauses of the old s.4 of the Central Excises and Salt Act . The appellants in this case manufactured different grades of lubricating oil in the United States. Large quantities of lubricating oil of particular manufacture and mark were imported into India through the port of Bombay and sold by the appellants directly to consumers. A dispute arose as to the provisions under which duty under the Sea Customs Act was attracted. Section 30 of that Act provided that for the purposes of the duty the real value should be deemed to be \"(a) the wholesale cash price, less trade discount, for which goods of the like kind and quality are sold or are capable of being sold, at the time and place of importation.........or ", "(b) where such price is not ascertainable, the cost at which goods of the like and quality could be delivered at such place,.....\" The government contended that the real value of the appellants' oil was its \"wholesale cash price\" referred to in s.30(a) a price ascertainable, without difficulty. The appellants replied that in view of the unique character of their oil and of the invariable course of business pursued by them in relation to its sale, a \"wholesale cash price\" for that oil had never existed and was not ascertainable and that therefore its real value must be determined in accordance with s.30(b) of the Act. The Privy council observed that there was no other oil in Bombay which could be said to be \"of the like kind and quality\" as the oil imported by the appellants and therefore the relevant \"wholesale cash price\" for the appellants, if there be such price, was to be found in the actual sales of those oils in Bombay by the appellants themselves provided that such sales had taken place. It was noted that large stocks of oil were imported at Bombay and all contracts for sale were made with reference to stocks. The oils were disposed of directly to consumers and never to dealers. The appellants themselves discharged all the functions of retailers of their oil as so sold. Besides, the selling price to consumers was about 70 per cent above the entry price, the difference representing the appellant's retailing profit and the expenses incurred by them in respect of matters subsequent to importation. The quantities of oil purchased by individual consumers were in some cases very large indeed. The Privy council took the view that in no sense could the price charged to consumers for the oils imported by the appellants be regarded as \"a wholesale case price\", and that therefore the case did not fall within s.30(a) but must be regarded as attracting s.30 ", "(b). ", "On the other side of the line is for India in Council, in which had to consider the scope of s. 30 of the Indian Sea Act again. The appellants imported motor vehicles into India from Canada and sold them to authorised dealers or distributors. They possessed a monopoly in India as regards the supply of such vehicles. The appellants issued from time to time a price list and the terms of business were that the retail price to be charged by the distributors to the public was that stated in the price list current at the time of arrival of the vehicles in India, and the price payable by the distributors to the appellants was the same price less a discount of 20 per cent. The Collector of assessed customs duty on a consignment of 256 motor cars under s. 30 (a). The appellants contended that for the motor-cars in question no wholesale cash price was ascertainable and the duty should have been assessed under s. 30 (b). approached the case from the stand point that if a wholesale price satisfying the description contained in s. 30 (a) was ascertainable, the goods could not be dealt with under s. 30 ", "(b), and in this connection they referred to the expression \"ascertainable\" as importing more than could be satisfied by the result of a mere estimate. held that the appellant's price to the distributors was a wholesale price within the meaning of s. 30 (a) because it was a cash price, and only discount had been deducted, and the sum payable by the distributor had been deduced to a price referable to a car in the condition in which it arrived in Bombay. It was contended for the appellants that \"goods of the like kind and quality\" in cl. (a) was a phrase which suggested other goods than that under assessment and therefore, the price fetched by the goods, themselves must be disregarded or should be considered only to see what price other similar goods would have realised. It was urged that since that test was not satisfied cl.(a) could not be invoked. rejected the contention, observing that the application of cl.(a) did not depend upon any hypothesis to the effect that at the time and place of importation an indefinite amount of further goods added to the available supply had effect upon the wholesale price. And what is important, further observed: \"But if there is an actual price for the goods themselves at the time and place of importation, and if it is a \"wholesale cash price, less trade discount\" the clause is not inapplicable for want of sales of other goods. The clause can be applied distributively to each of the motor cars in this consignment, and even if they are regarded collectively the clause is not defeated. A particular car may be sold at a price which, having regard to other transactions in such cars, or to other circumstances, is too high or too low. In that sense, the actual price in a particular instance does not necessarily or finally establish a wholesale price to satisfy cl. (a), whether the particular car or cars sold be part of the shipment in question or not. But the goods under assessment may under cl. (a) be considered as members of their own class even although at the time and place of importation there are no other members. The price obtained for them may correctly represent the price obtainable for goods of the like kind and quality at the time and place of importation.\" ", "These two cases illustrate the fundamental distinction between provisions such as the two clauses of s. 4 of the Central Excises and Salt Act . ", "Great reliance has been placed by the assessees on two important decisions of this Court in support of the contention that only the manufacturing cost and the manufacturing profit can be taken into account for assessing the \"value\" of an excisable article. The first case is . (supra). The assessee manufactured air conditioners and water coolers, and sold those article from its head office at Bombay and at branch officers in different towns in the country directly to consumers at list prices. The sales so effected amounted to about 90% to 95% of its production. It also sold the articles to wholesale dealers on terms which required them to sell the products at list prices, and that the assessee would sell them the articles at the listed price less 22% discount. The assessee contended before the excise authorities that the list price minus 22% discount allowed to the wholesale dealers would constitute the \"wholesale cash price\" for ascertaining the real value of the articles. The contention was accepted by the excise authorities, and assessments were made on that basis. Subsequently, the Superintendent of Central Excise began to assess the duty on the basis of the retail price and not the wholesale cash price. The case was taken by writ petition to , which held that the duty fell to be assessed under the old s.4(a) of the Central Excises and Salt Act on the basis of the wholesale cash price payable by the wholesale dealers, and not under s.4(b) on the basis of the price of retail sales effected directly to the consumers. The case was brought in appeal to this Court. The Court observed that for the purposes of s.4(a), it was not necessary for a wholesale market to exist in the physical sense of the term where articles of a like kind or quality are or could be sold. A wholesale market, it was observed, could also mean \"the potentiality of the articles being sold on a wholesale basis\". What was necessary was that the articles could be sold wholesale to traders. It was observed further that the application of s.4(a) of the Act did not depend upon any hypothesis to the effect that at the time and place of sale any further articles of the like kind and quality should have been sold. If there was an actual price for the goods themselves at the time and place of sale and if that was a 'wholesale cash price', the clause was not inapplicable for want of sale of other goods of a like kind and quality. Later follow the words which have brought on the present controversy: ", "\"Excise is a tax on the production and manufacture of goods (see (supra). Section 4 of the Act therefore provides that the real value should be found after deducting the selling cost and selling profit and that the real value can include only the manufacturing cost and the manufacturing profit. The section makes it clear that excise is levied only on the amount representing the manufacturing cost plus the manufacturing profit and excludes post manufacturing cost and the profit arising from post manufacturing operation, namely selling profit.\" ", "Those observations were made when the was examining the meaning of the expression \"wholesale cash price\". What the intended to say was that the entire cost of the article to the manufacturer (which would include various items of expense composing the value of the article) plus his profit on the manufactured article (which would have to take into account the deduction of 22% allowed as discount) would constitute the real value had to be arrived at after off-loading the discount of 22%, which in fact represented the wholesale dealer's profit. A careful reading of the judgment will show that there was no issue inviting the 's decision on the point now raised in these cases by the assessees. ", "The other case is . Collector of Central Excise and Ors. The appellant, , was a manufacturer of dye stuffs. It sold its products to two wholesale buyers, 70% of its total production to one and 30% to the other. The price charged was a uniform price described as the \"basic selling price\" less a trade discount of 18%. The wholesale dealers in turn resold the dyestuffs to distributors and also directly to large consumers, including textile mills. The large consumers paid the basic selling price, while the distributors paid a higher price but subject to a trade discount. The distributors sold the product to consumers. The question arose as to how the value of the dyestuffs manufactured by the appellants should be determined under s.4. The appellants contended that the value should be the price at which the appellants sold in wholesale to the two wholesale buyers, less a uniform trade discount of 18%. The excise authorities took the view that the value should be the price at which the wholesale buyers had sold the dye stuffs to the distributors without taking into account the discount given to the distributors. Before this , the excise authorities pressed the same contention, urging that s.4 (a) did not provide that in every case the wholesale price charged by the manufacturer should be taken into consideration and not the wholesale price charged by the wholesale buyers who sold the product also in wholesale to the next buyers. One of us () spoke for the in that case, and delivered a closely enunciated and lucid exposition of the true legal position. It was explained: ", "\"The value of the goods for the purpose of excise must take into account only the manufacturing cost and the manufacturing profit and it must not be loaded with post manufacturing cost or profit arising from post- manufacturing operation. The price charged by the manufacturer for sale of the goods in wholesale would, therefore, represent the real value of the goods for the purpose of assessment of excise duty. If the price charged by the whole sale dealer who purchases the goods from the manufacturer and sells them in wholesale to another dealer were taken as the value of the goods, it would include not only the manufacturing cost and the manufacturing profit of the manufacturer but also the wholesale dealer's selling cost and selling profit and that would be wholly incompatible with the nature of excise. It may be noted that wholesale market in a particular type of goods may be in several tiers and the goods may reach the consumer after a series of wholesale transactions. In fact the more common and less expensive the goods, there would be greater possibility of more than one tier of wholesale transactions. For instance, in a textile trade, a manufacturer may sell his entire production to a single wholesale dealer and the latter may in his turn sell the goods purchased by him from the manufacturer to different wholesale dealers at State level, and they may in their turn sell the goods to wholesale dealers at the district level and from the wholesale dealers at the district level the goods may pass by sale to wholesale dealers at the city level and then, ultimately from the wholesale dealers at the city level, the goods may reach the consumers. The only relevant price for assessment of value of the goods for the purpose of excise in such a case would be the wholesale cash price which the manufacturer from sale to the first wholesale dealer, that is, when the goods first enter the stream of trade. Once the goods have entered the stream of trade and are on their onward journey to the consumer, whether along a short or a long course depending on the nature of the goods and the conditions of the trade, excise is not concerned with what happens subsequently to the goods. It is the first immediate contact between the manufacturer and the trade that is made decisive for determining the wholesale cash price which is to be the measure of the value of the goods for the purpose of excise. The second or subsequent price, even though on wholesale basis, is not material. If excise were levied on the basis of second or subsequent wholesale price, it would load the price with a post manufacturing element, namely, selling cost and selling profit of the wholesale dealer. That would be plainly contrary to the true nature of excise as explained in the ' case (supra). Secondly, this would also violate the concept of the factory gate sale which is the basis of determination of value of the goods for the purpose of excise. ", "There can, therefore, be no doubt that where a manufacturer sells the goods manufactured by him in wholesale to a wholesale dealer at arms length and in the usual course of business, the wholesale cash price charged by him to the wholesale dealer less trade discount would represent the value of the goods for the purpose of assessment of excise. That would be the wholesale cash price for which the goods are sold at the factory gate within the meaning of s.4 (a). The price received by the wholesale dealer who purchases the goods from the manufacturer and in his turn sells the same in wholesale to other dealers would be irrelevant to the determination of the value and the goods would not be chargeable to excise on that basis.\" ", "This case also does not support the case of the assessees. When it refers to post-manufacturing expenses and post-manufacturing profit arising from post-manufacturing operations, it clearly intends to refer not to the expenses and profits pertaining to the sale transactions effected by the manufacturer but to those pertaining to the subsequent sale transactions effected by the wholesale buyers in favour of other dealers. ", "Having explained the true scope of (supra) and (supra), we may now proceed directly to the consideration of certain aspects of the provisions of the old s.4. There has been serious argument on the question whether s.4 (a) provides for the value of the assessee's excisable article being determined on the basis of the wholesale cash price charged or chargeable for articles of the like kind and quality sold by manufacturers generally or on the basis of the wholesale cash price of articles of the like and quality sold by the assessee. At first blush, it would seem that the former construction should be accepted, and indeed some support can be derived for that view from the observations of in (supra), where the \"wholesale cash price\" mentioned in s.30 ", "(a) of the Sea Customs Act, 1878, was construed to mean \"that price current for staple articles. the amount of which, if not a subject of daily publication in the press, is easily ascertainable in appropriate trade circles\". But this general observation can be of no help to the assessees, because since then, he courts have proceeded to make the position amply clear. The problem presented itself again to in (supra), and while taking note of what it had said in the earlier case, laid down that where the excisable goods constituted a class of their own and it was not possible to say that other manufacturers produced goods of that kind and quality, the goods under assessment could be considered as members of their own class for the purpose of s.30 (a) even although at the time and place of importation there were no other members. The price obtained for them, it was said, would correctly represent the price obtainable for goods of the like kind and quality at the time and place of importation. Then in (supra), this Court observed that the application of s.4 (a) of the Central Excises and Salt Act did not depend upon any hypothesis to the effect that at the time and place of sale, any further articles of like kind and quality should have been sold. If there was an actual price for the goods themselves at the time and place of sale and if that was a \"wholesale cash price\", the clause was not inapplicable for want of sale of other goods of a like kind and quality. It seems to us that the more practical way of looking at the problem is that there are very few cases indeed where two manufacturers produce an article of the like kind and quality. An instance has been supplied by learned counsel for the assessees, and we are referred to the case of a factory which manufactures identical electric bulbs for supply to a number of companies who sell them in the market under their own distinctive trade names. While such examples are possible, we are inclined to accept the statement of the learned Solicitor General that goods manufactured by different manufacturers generally differ in both kind and quality. Further, the manufacturing and other costs would vary from one manufacturer to another, depending on the efficiency of manufacturing techniques and management methods employed. Other important considerations are certainty and convenience in the administration of the levy from the view-point of both the assessee and the . There is the further consideration that the wholesale cash price charged by the assessee must be ascertained on the basis that the sale to the wholesale dealer is at arm's length. We are, therefore, of the view that we should prefer the construction suggested by the that s.4 (a) applies to the goods manufactured by the assessee himself. We may also point out that this conclusion is in accord with the general intent expressed in the new s.4 (1) (a), and as we shall show presently it is the case of both the assessees and the that in enacting the new s.4 in supersession of the old section, no material departure was intended from the basic scheme for determining the value of the excisable article. ", "Accordingly, we hold that pursuant to the old s.4 (a) the value of an excisable article for the purpose of the excise levy should be taken to be the price at which the excisable article is sold by the assessee to a buyer at arm's length in the course of wholesale trade at the time and place of removal. Where, however, the excisable article is not sold by the assessee in wholesale trade but, for example, is consumed by the assessee in his own industry the case is one where under the old s.4 (a) the value must be determined as the price at which the excisable article or an article of the like kind and quality is capable of being sold in wholesale trade at the time and place of removal. ", "Where the excisable article or an article of the like kind and quality is not sold in wholesale trade at the place of removal, that is, at the factory gate, but is sold in the wholesale trade at a place outside the factory gate, the value should be determined as the price at which the excisable article is sold in the wholesale trade at such place, after deducting therefrom the cost of transportation of the excisable article from the factory gate to such place. The claim to other deductions will be dealt with later. ", "Finally, where the wholesale price of the excisable article or an article of the like kind and quality is not ascertainable, then pursuant to the old s.4 (b) the value of the excisable article shall be the price at which the excisable article or an article of the like kind and quality is sold or is capable of being sold by the assessee at the time and place of removal or if the excisable article is not sold or is not capable of being sold at such place, then the price at which it is sold or is capable of being sold by the assessee at any other place nearest thereto. ", "In every case the fundamental criterion for computing the value of an excisable article is the price at which the excisable article or an article of the like kind and quality is sold or is capable of being sold by determining such value. ", "As we have noted, amended the General Excises and Salt Act by Act XXII of 1973. In particular, introduced a new s.4 which totally superseded the old section, and embodied a much more comprehensive and clearly enunciated scheme for the determination of the real value of an excisable article. Clause (a) of the new s.4 speaks of the \"value\" being the \"normal price, that is to say, the price at which such goods are ordinarily sold to a buyer in the course of wholesale trade for delivery at the time and place of removal where the buyer is not a related person and the price is the sole consideration for the sale.\" ", "Where the normal price of such good is not ascertainable for the reason that such goods are not sold or for any other reason, the new s.4 (1) (b) provides that the nearest ascertainable equivalent thereof determined in such manner as may be prescribed shall be the value of the excisable goods for the purpose of charging the excise duty. ", "It will be noticed that the basic scheme for determination of the price in the new s.4 is characterised by the same dichotomy as that observable in the old s.4. It was not the intention of , when enacting the new s.4 to create a scheme materially different from that embodied in the superseded s.4. The object and purpose remained the same, and so did the central principle at the heart of the scheme. The new scheme was merely more comprehensive and the language employed more precise and definite. As in the old s.4, the terms in which the value was defined remained the price charged by the assesseee in the course of wholesale trade for delivery at the time and place of removal. Under the new s.4 the phrase \"place of removal\" was defined by s.4 (b) not merely as \"the factory or any other place or premises of production or manufacture of the excisable goods\" from where such goods are removed but was extended to \"a warehouse or any place or premises wherein the excisable goods have been permitted to be deposited without payment of duty\" and from where such goods are removed. The judicial construction of the provisions of the old s.4 had already declared that the price envisaged under clauses (a) and (b) of that section was the price charged by the manufacturer in a transaction at arms length. After referring to several cases, some of which have already been mentioned here earlier, this Court pointed out in (supra) that \"the wholesale cash has to be ascertained only on the basis of transactions at arms length. If there is a special or favoured buyer to whom a specially low price is charged because of extra-commercial considerations, e.g., because he is a relative of the manufacturer, the price charged for those sales would not be the \"wholesale cash price\" for levying excise under s.4 (a) of the Act. A sole distributor might or might not be a favoured buyer according as terms of the agreement with him are fair and reasonable and were arrived at on purely commercial basis.\" ", "That was also the view taken in (). The new s.4 makes express provision in that behalf. Under the new s.4 also, it is necessary to take the price charged by the manufacturer as one which is un-effected by any concessional or manipulative considerations, and therefore the \"normal price\" mentioned in the new s.4 (1) ", "(a) speaks of a price \"where the buyer is not the related person and the price is the sole consideration for the sale.\" The expression \"related person\" has been specifically defined in the new s.4 (4) (c), and transactions in which a \"related person\" is involved are covered by the third proviso of s.4 (1) (a). ", "Both learned counsel for the assessees and the learned Solicitor General for the are agreed that in enacting the new s.4 Parliament did not intend to bring into existence a scheme of valuation different from that embodied in the old s.4 Reference was made in that connection to the Statement of Objects and Reasons. The difference, however, lies in this that while learned counsel for the assessee attempted to show by reference to the old s.4 that the legislative intent was to confine the value of an excisable article to the manufacturing cost and manufacturing profit and that therefore the same limitations should be read into the new s.4, the learned Solicitor General approached the problem from the other end and contended that since on a plain reading of the new s.4 the price actually charged by the assessee was the true criterion and was not limited to the manufacturing cost and manufacturing profit it is that construction which should be put also on the old s.4. We have earlier indicated our inability to accept the proposition that the old s.4 defined the value of an excisable article in terms of the manufacturing cost and manufacturing profit exclusively. We find from an examination of the provisions of the new s.4 that a similar conclusion must follow. The normal price mentioned in the new s.4 (1) (a) is the price at which the goods are ordinarily sold by the assessee in the course of wholesale trade. It is the wholesale price charged by him. It is a price which may vary, according to the first proviso to the new s.4 (a) with different classes of buyers. It may also be, according to the second proviso to the new s.4 (1) (a) the price fixed as the wholesale price under any law or the maximum price where the law fixes a maximum. The price may also be a different price if the case falls within the third proviso to the new s 4 (1) (a). In that event it will be the price charged by a related person in the course of wholesale trade. Clearly, it is not possible to conceive of the price under the new s.4 (1) (a) being confined to the manufacturing cost and the manufacturing profit. Moreover, it is reasonable to suppose that the central principle for the determination of the value of the excisable article should be the same, whether the case falls under cl. (a) or cl (b) of the old s.4 or under the new s.4 (1). When regard is had to the provision of cl. (b) in each case, it is not possible to limit the price to its components representing the manufacturing cost and manufacturing profit. ", "We have examined the principles of an excise levy and have considered the statutory construction of the Act, before and after its amendment, in view of the three propositions formulated, on behalf of the assessees, as principle constituting the essential characteristics of a duty of excise. It is apparent that the first proposition, that excise is a tax on the manufacture or production of goods, and not on anything else, is indisputable and is supported by a catena of cases beginning with The Central Provinces and Berar Sales of Motor Spirit and Lubricants Taxation Act. 1938 (supra). As regards the second proposition, that uniformity of incidence is a basic characteristic of excise, we are inclined to think that the accuracy of the proposition depends on the level at which the statute rests it. We shall discuss that presently. As to the third proposition, that the exclusion of post manufacturing expenses and post manufacturing profit is necessarily involved in the first principle does not inevitably follow. The exclusion of post manufacturing expenses and post manufacturing of profits is a matter pertaining to the ascertainment of the \"value\" of the excisable article, and not to the nature of the excise duty, and as we have explained, the standard adopted by the for determining the \"value' may possess a broader base than that on which the charging provision proceeds. The acceptance of the further statement contained in the formulation of the third proposition, that the exclusion of post manufacturing expenses and post manufacturing profits helps to achieve uniformity of incidence in the levy of excise duty, depends on what is the point at which such uniformity of incidence is contemplated. It is not necessarily involved at the stage of sale of the article by the manufacturer because we find for example that under the amended s.3 (3) of the Central Excises and Salt Act , different tariff values may be fixed not only (a) for different classes of descriptions of the same excisable goods, but also (b) for excisable goods of the same class or description (i) produced or manufactured by different classes of producers or manufacturers, or (ii) sold to different classes of buyers. That the \"value\" of excisable goods determined under the new s.4 (a) may also vary according to certain circumstances is evident from the three clauses of the proviso to that clause. Clause (i) recognises that in the normal practice of wholesale trade the same class of goods may be sold by the assessee at different prices to different classes of buyers; in that event, each such price shall, subject to the other conditions of cl. ", "(a), be deemed to be the normal price of such goods in relation to each class of buyers. Clause (ii) provides that where the goods are sold in wholesale at a price fixed under any law or at a price being the maximum, fixed under any such law, then the price or the maximum price, as the case may be, so fixed, shall in relation to the goods be deemed to be the normal price thereof. Under cl. (iii), where the goods are sold in the course of wholesale trade by the assessee to or through a related person, the normal price shall be the price at which the goods are sold by the related person in the course of wholesale trade at the time of removal to dealers (not being related persons) or where such goods are not sold to such dealers, to dealers (being related persons) who sell such goods in retail. The verity of the three principles propounded by learned counsel for the assessees has been, as indeed it had to be, examined in the context of the Act before and after its amendment. For the case of the assessees is that the amendment has made no material change in the basic scheme of the levy and the provisions for determining the value of the excisable article. ", "Learned counsel for the assessees has contended that the old s. 4 (a) expresses the conceptual nature of the \"value\" of an excisable article because neither the identity of the manufacturer nor the identity of the goods sought to be charged nor the actual wholesale price charged by the manufacturer is the determining factor. We have come to the conclusion after carefully weighing the matter that on a true construction of its provisions in the context of the statutory scheme the old s (a) should be considered as applicable to the circumstances of the particular assessee himself and not of manufacturers generally. As regards the second element, namely, the identity of the goods sought to be charged, that also, to our mind, is a determining factor because the statute speaks of \"an article of the like kind and quality\". The third element, namely, the actual wholesale price charged by the manufacturer is likewise a determining factor in view of our conclusion that the identity of the manufacturer is material in the application of the old s. 4 (a). ", "Learned counsel for the assessees urged that the expression \"normal price\" in the new s. 4 (1) (a) means the price normal for the purposes of the excise duty and that, it is said, means the manufacturing cost plus the manufacturing profit. It is urged that the normal price for the purposes of the levy must be a price not loaded with extraneous elements, extraneous to the nature of the impost. It is pointed out that in order to bring the operation of the statute within the purpose intended by the the courts are justified is doing \"some violence to the words\" and support is taken from v. I.R.C., and the principle adopted by this Court in and in KP. v. Income-Tax Officer, Ernakulam and Another. A somewhat similar approach had already been adopted by this Court in . Learned counsel also referred to and . Punjab. Jammu & Kashmir and Himachal Pradesh. When the new s. 4 (1) ", "(a) is read as a whole, the meaning of the expression \"normal price\" becomes plainly evident. It will be noticed the expression \"normal price' is followed by the phrase \"that is to say\". The phrase \"that is to say\" says Stroud's Judicial Dictionary (Fourth Edition, Vol. 5 p. 2753)\" is the commencement of an ancillary clause which explains the meaning of the principal clause. It bas the following properties: (1) it must not be contrary to the principal clause; (2) it must neither increase nor diminish it; (3) but where the principal clause is general in terms it may restrict it,\" and reference has been made to v. and v . Therefore, the phrase \"normal price\" is defined by the words in s. 4 (1) (a) which follow. It is 'the price at which such goods are ordinarily sold by the assessee to a buyer in the course of wholesale trade for delivery at the time and place of removal where the buyer is not a related person and the price is the sole consideration for the sale,\" ", "Learned counsel for the assessees contended that the new s. 4 (1) (a) also levies excise on the basis of a conceptual value which must exclude post manufacturing profit and in support of that submission he has adduced a number of reasons. It is said that the essential principle of excise dictates the exclusion of post manufacturing expenses and profit. That, it is pointed out, is also suggested by the principle of uniformity of incidence, for it is only by such exclusion that uniform criterion can be applied to all manufacturers, those who have selling and marketing organisations and who load the ex-factory wholesale price to recoup themselves the costs of the selling organisation and of equalised freight and those who do not load their wholesale price with such post manufacturing expenses. Reliance is placed on the legislative history, it being contended that the new s. 4 . should be interpreted on the same basis as the old s. 4 . Reference is made to the Statement of Objects and Reasons of Act XXIII of 1973 to show that no change of substance in the basis of the charge or levy was intended by the amendment of s. 4 . It is said that the phrase \"that is to say\" in the new s. 4 (1) (a) indicates that the conceptual criterion for determining the value is substantially the same as it was in the old s. 4 . Then, it is pointed out, s. 4 (1) (b) enacts that \"where the normal price is not ascertainable, the nearest ascertainable equivalent thereof\" has to be determined. As a consequence, it is urged that where sales are made on ex-depots post manufacturing expenses and post manufacturing profit must be deducted. The same principle should apply in the construction of the new s. 4 (1) (a). By adopting the same principle for cases falling under s. 4 (1) (a) and s. 4 (1) ", "(b) it is possible it is said, to reach uniformity of incidence in both classes of cases. It is pointed out, that the value of the goods must be the same for the purposes of the levy, whether the goods are sold ex-factory or ex-depot. It is urged that although the new s. 4 (4) (d) (ii) permits two types of deductions of taxes and discount, it does not prohibit deductions other shall the two permitted. Finally, if the wholesale p. ice can be adjusted upward by the department making additions thereto, it can be adjusted, downward, at the instance of the assessee, to make it conform to the conceptual criterion of the value on which excise can be levied. ", "The essential content of the reasons stated by learned counsel proceeds on the assumption that a conceptual value governs the assessment of the levy. We have already examined the validity of the three principles underlying the concept, and we have indicated the extent to which they cannot be accepted. We have observed that . the old s 4 as well as the new s. 4 determine the value on the basis price charged or chargeable by the particular assessee, and the price is charged or is chargeable in respect of the article manufactured by him. The value of the excisable article is determined in that context. When that is so, the fundamental basis on which the argument has been raised on behalf of the assessees cannot survive. We may add that whether any further deductions can be claimed beyond those already mentioned in the statute will depend on the nature of those claims in the case of a particular assessee. ", "Our attention has been drawn to the observation of this Court in that \"a duty of excise is a tax-levy on home-produced goods of a specified class or description, the duty being calculated according to the quantity or value of the goods and which is levied because of the mere fact of the goods having been produced or manufactured and unrelated to and not dependent on any commercial transaction in then\". Clearly, when the Court referred to the calculation of the duty according to the quantity or value of the goods, it referred disjunctively- to the nature of the levy, and it is the nature of the levy 13 not the value for assessing the levy, which it had in mind when it pointed to the goods having been produced or manufactured, and observed that the nature of the levy is not related to or dependent on any commercial transaction. The following observation of , in The Central Provinces and Berar Sales of Motor Spirit and Lubricants Taxation Act, 1938 (supra) was also placed before us: ", "\"In my opinion the power to make laws with respect to duties of excise given by the Constitution Act to is to be construed as a power to impose duties of excise upon the manufacturer or producer of the excisable articles, or at least at the stage of, or in connection with, manufacture or production, and extends no further.\" ", "The learned Chief Justice was referring in this statement to the power to make a law respect of a duty of excise. He construed it as a power to impose the duty upon the manufacturer or producer, and explained that the levy related to the manufacture or production and to no further stage. It was the nature of the levy which was adverted to by the learned Chief Justice, namely, that it was a levy on goods manufactured or produced. It will be remembered that the question before in that case whether the levy in question was a levy of excise or a levy of sales tax. A levy of excise turns on the manufacture or production of the excisable article, while a levy of sales tax by its nature, arises at a stage beyond, namely, the sale of the article. The task before the was to identify the nature of the levy. It was not concerned with the assessment of the value of the article for the purpose of the levy. ", "This brings to a close in these cases the question whether the value of an article for the purpose of the excise levy must be confined to the manufacturing cost and the manufacturing profit in respect of the article. In our judgment, the question has to be answered in the negative. ", "385 ", "The next question for consideration is whether the provisions in the new s. 4 in respect of transactions' effected by the assessee to or through \"a related person\" are invalid. The new s. 4 (1) (a) provides that the value shall be deemed to be the normal price, and the normal price is defined as the price at which the goods are ordinarily sold by the assessee in the course of wholesale trade where the buyer is not a \"related person\" and the price is the sole consideration for the sale. The third proviso to the new s. 4 (1) (a) provides that where the assessee so arranges that the goods are generally not sold by him in the course of wholesale trade except to or through a related person, the normal price of the goods sold by the assessee to or through such related person shall be deemed to be the price at which they are ordinarily sold by the related person in the course of wholesale trade at the time of removal, to dealers (not being related persons) or where such goods are not sold to such dealers, to dealers (being related persons) who sell such goods in retail. The new s. 4 (4) (c) defines the expression \"related person\" as follows: ", "\"(c) 'related person' means a person who is so associated with the assessee that they have interest, directly or indirectly, in the business of each other and includes a holding company, a subsidiary company, a relative and a distributor of the assessee, and any sub- distributor of such distributor. ", "Explanation :- In this clause 'holding company', 'subsidiary company' and 'relative' have the same meanings as in the Companies Act , 1956 .\" ", "Learned counsel for the assessees contends that the provisions regarding related persons are wholly unnecessary because to counter-act evasion or avoidance any artificially arranged price between the manufacturer and his wholesale buyer can be rejected in any case under s. 4 , and we are referred to the observations of this Court in (supra) and (supra). It is true, we think, that the new s. 4 (1) contains inherently within it the power to determine the true value of the excisable article, after taking into account any concession shown to a special or favoured buyer because of extra-commercial considerations, in order that the price be ascertained only on the basis that it is a transaction at arms length. That requirement is emphasised by the provision in the new s. 4 (1) (a) that the price should be the sole consideration for the sale. In every such case, it will be for the to determine on the evidence before it whether the transaction is one where extra-commercial considerations have entered and, if so, what should be the price to be taken as the value of the excisable article for the purpose of excise duty. Nonetheless, it was open to to incorporate provisions in the section declaring that certain specified categories of transactions fall within the tainted class, in which case an irrebuttable presumption will arise that transactions belonging to those categories are transactions which cannot be dealt with under the usual meaning of the expression \"normal price\" set forth in the new s. 4 (1) (a). They are cases where it will not be necessary for the to examine the entire gamut of evidence in order to determine whether the transaction is one prompted by extra- commercial considerations. It will be open to the on being satisfied that the third proviso to the new s. 4 (l) ", "(a) read with the definition of \"related person\" in s. 4 (4) ", "(c) is attracted, to proceed to determine the \"value in accordance with the terms of the third proviso. ", "It is urged on behalf of the assessee that the provisions are, whimsical and arbitrary, and cannot be said to be reasonably calculated to deal with the issue of evasion or avoidance of excise. It is said that the assessment on the manufacturer by reference to the sale price charged by his distributor is \"wholly incompatible with the nature of excise\", and we are referred to (supra). Now, is a well known legislative practice to enact provisions in certain limited case where an assessee may be taxed in respect of the income or property truly belonging to another. They are cases where the intervenes to prevent the circumvention of the tax obligation by tax payers seeking to avoid or reduce their tax liability through modes resulting in the income or property- arising to another. The provisions of the law may indeed be so enacted that the actual existence of such motive may be wholly immaterial, and what has been done by the assessee may even, proceed from wholly bona fide intention. With the aid of legal fiction, the fastens the liability on the assessee. When the legislature employs such a device, and the liability is attached without qualification, it is reasonable to infer that an irrebuttable presumption has been created by law. Such provisions have been held to be within the legislative competence of the and as falling within its power of taxation, and reference may be made to , , . ", "It is contended for the assessees that the definition of the expression \"related person\" is so arbitrary that it includes within that expression a distributor of the assessee. It is urged that the provision falls outside the ambit of Entry 84 of List I of the Seventh Schedule to the Constitution inasmuch as it is wholly inconsistent with the levy of excise, and if it is attempted to seek support for the provision from the residuary Entry 97 of List l as a non-descript tax the attempt must fail because there is no charging section in the Central Excises and Salt Act empowering the levy of such non-descript tax nor any machinery provision in the Act for collection such a tax. The charging provision and the machinery provisions of the Act, it is pointed out, deal exclusively with excise duty and not with any other tax. The validity of the provisions is assailed also on the ground that it violates Articles 14 and 19 of the Constitution. The challenge made on behalf of the assessees is powerful and far-reaching. But it seems to us unnecessary to enter into that question because we are satisfied that the provision in the definition of \"related person\" relating to a distributor can be legitimately read down and its validity thus upheld. In our opinion, the definition of related person should he so read that the words \"a relative and a distributor of the assessee\" should be understood to mean a distributor who is a relative of the assessee. It will be noticed that the Explanation provides that the expression \"relative\" has the same meaning as in the Companies Act , 1956. As regards the other provisions of the definition of \"related person\", that is to say, \"a person who is so associated with the assessee that they have interest directly or indirectly, in the business of each other and includes a holding company, a subsidiary company. .\", we think that the provision shows a sufficiently restricted basis for employing the legal fiction. Here again, regard must be had to the Explanation which provides that the expression \"holding company and subsidiary\" have the same meanings as in the Companies Act , 1956. Reference in this connection may be made to where the principle was approved by this Court that the corporate veil could be lifted where the companies shared the relationship of a holding company and a subsidiary company, and to ., where this Court held that the veil of corporate entity could be lifted to pay regard to the economic realities behind the legal facade, for example, where the corporate entity was used for tax evasion or to circumvent tax obligation. ", "At one stage, it was urged for the assessees that by making provision in the Central Excises and Salt Act respecting transactions to or through a \"related person\", was very close to making the levy a sales tax. The contention cannot be accepted and we need merely refer to the position delineated earlier and set forth in the series of cases beginning with The Central Provinces and Berar Sales of Motor Spirit and Lubricants Taxation Act, 1938 (supra) See also what has gone before, we consider that the true position under the Central Excises and Salt Act , 1944 as amended by Act XXII of 1973 can be set forth as follows . ", "(i) The price at which the excisable goods are ordinarily sold by the assessee to a buyer in the course of wholesale trade for delivery at the time and place of removal as defined in sub-section (4) ", "(b) of section 4 is the basis for determination of excisable value provided, of course, the buyer is not a related person within the meaning of sub-section (4) (c) of section 4 and the price is the sole consideration for the sale. This proposition is subject to the terms of three provisos to sub-section (1) (a) of section 4 . ", "(ii) There the price of excisable goods in the course of wholesale trade for delivery at the time and place of removal cannot be ascertained for the reason that such goods are not sold or for any other reason, the nearest ascertainable equivalent thereof determined in the manner prescribed by the Central Excises (Valuation) Rules. 1975 should be taken as representing the excisable value of the goods; ", "389 ", "(iii) Where wholesale price of any excisable goods for delivery at the place of removal is not known and the value thereof is determined with reference to the wholesale Price for delivery at a place other than the place of removal, the cost of transportation from the place of removal to the place of delivery should be excluded from such price; ", "(iv) Of course, these principles cannot apply where the tariff value has been fixed in respect of any excisable goods under sub-section (2) of section 3 ; ", "(v) On a proper interpretation of the definition of 'related person' in sub-section (4) (c) of section 4 , the words \"a relative and a distributor of the assessee\" do not refer to any distributor but they are limited only to a distributor who is a relative of the assessee with in the meaning of the Companies Act , 1956. So read, the definition of 'relates person' is not unduly wide and does not suffer from any constitutional infirmity. It is within the legislative competence of . It is only when an assessee so arranges that the goods are generally not sold by him in the course of wholesale trade except to or through such a related person that the price at which the goods are ordinarily sold by the related person in the course of wholesale trade at the time of removal to dealers (not being related persons) or where such goods are not sold to such dealers, to dealers (being related persons who sell such goods in retail is liable to be taken as the excisable value of the goods proviso under ", "(iii) to sub-section (1) (a) of section 4 . ", "We now proceed to the question whether any post manufacturing expenses are deductible from the price when determining the \"value\" of the excisable article. The old s. 4 provided by the Explanation there to that in determining the price of any article under that section no abatement or deduction would be allowed except in respect of trade discount and the amount of duty payable at the time of the removal of the article chargeable with duty from the factory or other premises aforesaid. The new s. 4 provides by subs.(2) that where the price of excisable goods for delivery at the place of removal is not known and the value is determined with reference to the price for delivery at a place other than the place of removal, the cost of transportation from the place of removal to the place of delivery has to be excluded from such price. The new s. 4 also contains sub-s. (4) (d) ", "(ii) which declares that the expression \"value\" in relation to any excisable goods, does not include the amount of the duty of excise, sales tax and other taxes, if any, payable on such goods and, subject to such rules as may be made, the trade discount (such discount not being refundable on any account whatsoever allowed in accordance with the normal practice of the wholesale trade at the time of removal in respect of such goods sold or contracted for sale. Now these are clear provisions expressly a providing for deduction, from the price, of certain items of expenditure. But learned counsel for the assessees contend that besides the heads so specified a proper construction of the section does not prohibit the deduction of other categories of post manufacturing expenses. It is also urged that although the new s. 4(4) (d) (i) declares that in computing the \"value\" of an excisable article, the cost of packing shall be included, the provision should be construed as confined to primary packing and as not extending to secondary packing. The head under which the claim to deduction is made are detailed below : ", "(1) Storage charges. ", "(2) Freight or other transport charges, whether specific or equalised. ", "(3) Outward handling charges, whether specific or equalised. ", "(4) Interest on inventories (stocks carried by the manufacturer after clearance). ", "(5) Charges for other services after delivery to the buyer. ", "(6) Insurance after the goods have left the factory gate. ", "(7) Packing charges. ", "(8) Marketing and Selling organisation expenses, including advertisement and Publicity expenses. ", "At the outset, we must make it clear that the contentions in this regard on behalf of the assessees proceeds on two broad bases. ", "391 ", "The first is that to determine the value of an excisable article, all expenses must be excluded which do not enter into the formula of manufacturing cost plus manufacturing profit. This follows from the principal plank of the assessees' case that the \"value\" must be confined to the manufacturing cost, and the manufacturing profit. For, it is said, that if the deductions claimed are allowed, the price would be brought down to the conceptual value. All post manufacturing expenses are claimed from that perspective and within that context. The other basis on which the claim proceeds, is that the price at the factory gate and the price at a depot outside the factory gate are identical. ", "We shall now examine the claim. It is apparent that for the purpose of determining the \"value\", broadly speaking both the old s. 4(a) and the now s 4(1) (a) speak of the price for sale in the course of wholesale trade of an article for delivery at the time and place of removal namely, the factory gate where the price contemplated under the old s. 4(a) or under the new s. 4(1)(a) is not ascertainable, the price is determined under the old s. 4(b) or the new s. 4 (1) (b). Now, the price of an article is related to its value (using this term in a general sense), and into that value have poured several components, including those which have enriched its value and given to the article its marketability in the trade. Therefore, the expenses incurred on account of the several factors which have contributed to its value upto the date of sale, which apparently would be the date of delivery, are liable to be included. Consequently where the sale is effected at the factory gate, expenses incurred by the assessee up to the date of delivery on account of storage charges, outward handling charges, interest on inventories (stocks carried by the manufacturer after clearance), charges for other services after delivery to the buyer, namely after-sales service and marketing and selling organisation expenses including advertisement expenses cannot be deducted. It will be noted that advertisement expenses, marketing and selling organisation expenses and after-sales service promote the marketability of the article and enter into its value in the trade. Where the sale in the course of wholesale trade is effected by the assessee through its sales organisation at a place or places outside the factory gate, the expenses incurred by the assessee upto the date of delivery under the aforesaid heads cannot, on the same grounds, be deducted But the assessee will be entitled to a deduction on account of the cost of transportation of the excisable article from the factory gate to the place or places where it is sold. The cost of transportation will include the cost of insurance on the freight for transportation of the goods from the factory gate to the place or places of delivery. ", "Where freight is averaged and the averaged freight is included in the wholesale cash price so that the wholesale cash price at any place or places outside the factory gate is the same as the wholesale cash price at the factory gate, the averaged freight included in such wholesale cash price has to be deducted in order to arrive at the real wholesale cash price at the factory gate and Do excise duty can be charged on it. ", "The case in respect of the cost of packing is somewhat complex. The new s. 4(4)(d)(i) has made express provision for including the cost of packing in the determination of \"value\" for the purpose of excise duty. Inasmuch as the case of the parties is that the new s. 4 substantially reflects the position obtaining under the unamended Act. We shall proceed on the basis that the position in regard to the cost of packing is the same under the Act, both before and after the amendment of the Act S. 4(4) (d) (i) reads: ", "\"(4) For the purposes of this section- ", "(d) \"value\", in relation to any excisable goods,- ", "(i) where the goods are delivered at the time of removal in a packed condition, includes the cost of such packing-except the cost of the packing which is of a durable nature and is returnable by the buyer to the assessee. Explanation.-In this sub-clause \"packing\" means the wrapper, container, bobbin, pirn, spool, reel or sarp beam or any other thing in which or on which the excisable goods are wrapped, contained or wound.\" ", "It is relevant to note that the packing, of which the cost is included is the packing of which the goods are wrapped, contained or wound when the goods are delivered at the time of removal. In other words, it is the packing in which it is ordinarily sold in the course of wholesale trade to the wholesale buyer. The degree of packing in which the excisable article is contained will vary from one class of articles to another. From the particulars detailed before us by the assessees, it is apparent that the cost of primary packing, that is to say, the 'packing in which the article is contained and in which it is made marketable for the ordinary consumer, for example a tube of toothpaste or a bottle of tablets in a cardboard carton, or biscuits in a paper wrapper or in a tin container, must be regarded as falling within s. 4(4) ", "(d)(i). That is indeed conceded by learned counsel for the assessee. It is the cost of secondary packing which has raised serious dispute. Secondary packing which different grades. There is the secondary packing which consists of larger cartons in which a standard number of primary cartons in the sense mentioned earlier) are packed. The large cartons may be packed in to even larger cartons for facilitating the easier transport of the goods by the wholesale dealer. Is all the packing, no matter to what degree, in which the wholesale dealer takes delivery of the goods to be considered for including the cost thereof in the \"value\" ? Or does the law require a line to be drawn somewhere? We must remember that while packing is necessary to make the excisable article marketable, the statutory provision calls for strict construction because the levy is sought to be extended beyond the manufactured article itself. It seems to us that the degree of secondary packing which is necessary for putting the excisable article in the condition in which it is generally sold in the wholesale market it the factory gate is the degree of packing whose cost can be included in the \"value\" of the article for the purpose of the excise levy. To that extent, the cost of secondary packing cannot be deducted from the wholesale cash price of the excisable article at the factory gate. ", "If any special secondary packing is provided by the assessee at the instance of a wholesale buyer which is not generally provided as a normal feature of the wholesale trade, the cost of such packing shall be deducted from the wholesale cash price. ", "We have also been referred to s. 2(f) of the Act which defines the expression \"manufacture\", and it is urged that the degree of packing to be considered for the purpose of including its cost in the \"value\" of an excisable article should be spelled out from that definition. We are unable to accept the suggestion. The expression \"manufacture\" is related to the taxable event and refers to a process which enters into the character of the article, while \"packing\" has been defined by s. 4 (4) (d) (i) in relation to the \"value\" of the article. ", "That, we think, is the position in regard to the cost of packing under the Act, both before a its amendment and after. ", "394 ", "We have considered the claim to deductions under the specific heads enumerated by the assessees, and our judgment is confined to those items. No other head of expenses has been placed before us for our opinion. ", "Learned counsel for the parties have drawn our attention to a number of decisions rendered by different on some of the points raised before us. We have examined those cases, but we think it unnecessary to refer to them as they do not add to the considerations we have kept before us in arriving at our conclusions. ", "These are the reasons for our order of May 9,1983, and they explain the scope within which that order must be construed as well as the basis on which it was made. ", "The individual appeals, writ petitions, special leave petitions and transferred cases will be listed now for appropriate orders in the light of this judgment on October 31, 1983. ", " ", "395"], "relevant_candidates": ["0000214162", "0000328927", "0000356592", "0000424370", "0000538117", "0000664536", "0000766438", "0000819589", "0000882976", "0000923724", "0000983159", "0001297272", "0001345065", "0001404351", "0001448438", "0001448611", "0001464523", "0001546265", "0001628739", "0001649618", "0001693454", "0001874054", "0001976113", "0127302140"]} {"id": "0000035468", "text": ["JUDGMENT ", "1. Second Appeal No. 801 and Second Appeal No. 802 of 1920 are plaintiff's appeals arising out of a suit for sale, on the basis of a mortgage-deed, dated the 16th of November 1905, executed by the father of the present defendants in favour of the plaintiff. The defendants did not put in an appearance in the Court of first instance and no written statement was filed on their behalf. The learned Subordinate Judge, relying on a clause in the mortgage-deed, which entitled the mortgagee to sue for the whole amount of principal and interest on default of payment of annual interest, held that the claim to enforce the charge was barred by time under Article 132 of the Limitation Act , but he was, however, of opinion that the personal remedy was not barred. He, accordingly, granted the plaintiff a simple money decree. ", "2. Both parties appealed to the learned District Judge who, holding that the personal remedy also was barred, dismissed the whole suit. The plaintiff appealed to this from the lower Appellate 's decrees and his appeals came up for hearing before of this , which, in view of some apparent conflict of opinion, has referred these cases to a Fall Bench. There are only two points which arise for our determination: ", "(1) Whether the plaintiff's claim to enforce the charge by sale of the mortgaged property is barred by time? ", "(2) Whether, in any case, he is entitled to a simple money-decree? ", "3. As some argument has turned on the actual wording of the document in suit, we think it desirable to quote the operative portion of it in full. It is as follows: ", "I hereby covenant and give in writing that I shall pay the money aforesaid with interest at the rate of 8 annas per cent. per mensem, within a period of twelve years and shall pay interest from year to year. In case of non-payment of interest from year to year, the creditor has the option to add the interest to the principal and to charge interest thereon at the aforesaid rate or to recover through principal and interest from me and hypothecated property and also from my other moveable or immoveable property and from my person within the stipulated period. The period fixed shall not bar the claim. In case of non-payment within the stipulated period, the creditor shall have the power to recover the money, principal and interest, together with compound interest from me, mortgaged property or other moveable or immoveable property of mine. If I am not able to pay the money within the stipulated period and with the consent of the creditor the money remains unpaid, the interest and com-pound interest at the aforesaid rate shall continue to run at the stipulated rate till the date of realization. ", "4. It is clear from the terms of this document that the ordinary period fixed for payment was 12 years, and, if no default were made, the mortgagee would not have been entitled to sue for the recovery of his money before the expiry of the period fixed. If, however, a default were made in payment of the annual interest, it would be open to the mortgagee, if he so desired, to sue for the whole amount of principal and interest; and it is clear that, in that case, the mortgagor could not succeed on the plea that the claim was premature. On the other hand, there is nothing in the deed which makes it obligatory on the mortgagee to sue as soon as a default is made. ", "5. Now, there can be no doubt that a suit for sale on the basis of a mortgage-deed is one to enforce payment of money charged upon immoveable property within the meaning of Article 132 of the Limitation Act of 1908. The previous decisions to the contrary were overruled by their Lordships of in the case of 30 M. 426 : 9 Bom.L.R. 1104 : 4 A.L.J. 625 : 11 C.W.N. 1005 : 6 C.L.J. 379 : 2 M.L.T. 333 : 17 M.L.J. 444 : 34 I.A. 186 (P.C.). This view has been accepted by the and the wording of Article 132 has remained unaltered and a special period of grace provided for in Section 31 of the new Act. ", "6. It being beyond question that Article 132 applies, we have to look So the words in the third column of that Article in order to determine the point of time from which limitation begins to run. The period of limitation is 12 years from the time \"when the money sued for becomes due.\" We have, therefore, to answer the simple question, when did the money become due in the present case? Obviously, money becomes due as soon as it becomes payable by the mortgagor to the mortgagee, that is to 'say, as soon as it can be legally recovered by the mortgagee. The question whether the mortgagee chooses to wait and does not sue at once, is wholly immaterial. The money might be due and yet the mortgagee may not like to call it in at once and may safely wait for a period of 12 years. Examining the terms of the mortgage-deed in this light, it is obvious that, as soon as the first default was made, a right accrued to the mortgagee to sue for the whole sum with interest. Whether he chose to avail himself of it or not, is another matter. On default having been made, the money certainly did become due at once; the mere circumstance that the creditor had the option of not sailing in the money cannot wipe out the fact that the money had in fact become due. ", "7. The view expressed above is undoubtedly in consonance with the rule of law prevailing in England In v. (1842) 62 E.R. 423 at p. 426 : 4 Q.B. 519 : 3 G. & D. 402 : 12 L.J.Q.B. 134 : 17 Jur. 302 : 114 E.R. 994, it was remarked: \"If he those to wait till all the instalments became due, no doubt he might do so; but that which was optional on the part of the plaintiff would not affect the right of the defendant, who might well consider the action as accruing from the time that the plaintiff had a right to maintain it. The Statute of Limitation runs from the time the plaintiff might have brought his action, unless he was subject to any of the disabilities specified in the Statute.\" This case was followed by in v. (1891) 2 Q.B. 509 : 60 L.J.Q.B. 619 : 65 L.T. 329 : 39 W.R. 262, where money had been lent for a fixed period of five years subject to the power to call in the same at an earlier period\" tinder certain events including a default in the payment of any quarterly interest for 21 days. It was held in that case that a claim brought more than six years after the first default was barred by time, inasmuch as the cause of action arose on the first default, and that the time began to run from the earliest time at which the plaintiff could have brought her action. These cases are accepted laws in England (vide, Laws of England, Volume XIX, page 44). ", "8. It has been very strongly urged before us that the effect of holding that time begins to run from the first default would be to strike out an important clause under which the mortgagee is given the option to wait, and this would be going against the express intention of the parties. But it is not quite easy to see what is really meant by saying that the mortgagee has the option of suing or not suing. In slither case, be is not bound to sue at once; he can, in fact, wait for 12 years. If by the word \"option\" is meant that the parties agree that, although the money does become recoverable. yet the Mortgagee can wait and at the same time keep the Statute of Limitation in abeyance, then it would be a case of contracting cut of the Statute. An agreement of this kind can never have the effect of preventing the period of limitation from running out. But, as a matter of fact, there is in the deed no covenant that limitation will not begin to run, and the option after all might not mean anything more than that a forbearance to sue would not disentitle the mortgagee from claiming interest, but that interest would continue torun though no suit is brought for some time. If this only in the intention of the parties, then no difficulty whatsoever arises. ", "9. Our attention has not been invited to any Pronouncement of their Lordships of. which would cover the point arising in this case. The only case to which reference has been made is that of v. . 1 C. 163 : 25 W.R. 84 : 3 I.A. 1 : 3 Sar.P.C.J. 58 : 3 Suth. P.C.J. 222 : 1 Ind. Dec. (N.S.) 105 (P.C.). Although it is conceded that the point before us did not directly arise in that case and the remark relied upon by the learned for the appellant was a mare obiter dictum, nevertheless, any observation of their Lordships is entitled to the greatest weight and should be a guide to us. It is, therefore, necessary for us to consider that case carefully. There was a mortgage-deed executed on the 21st of Jane 1856, which was subsequently registered and under which it was stipulated that the money would be re-paid in June 1886, but that, in the event of the lands being sold in execution of a decree obtained by a third party, the mortgages would be at liberty at once to sue for the recovery of the debt. On the 18th May 1835, the lands mortgaged were actually sold in execution of a simple money-decree. On the 30th of August 1871, that is, more than six years after but within 12 years of the date of the sale, a suit to recover the amount on the mortgage-deed was instituted. The defendants pleaded that Clause 16 of Act XIV of 1859, which was the general clause applicable to suits for which no other limitation was expressly provided, was applicable, and that the claim was barred, by the six years rule. Their Lordships repelled this contention holding that the slangs applicable was Clause 12 which governed suits * for recovery of immoveable property or of any interest in immoveable property to which no other provision of this Act applies.\" Referring to the contention of the Counsel for the defendants that the six years rule applied, their Lordships remarked that they must not be supposed to give any countenance to the argument that the suit would have bean barred if the limitation of six years under Clause 16 bad been applicable to it. ", "10. Now, it is to be noted that in the old Limitation Act of 1859 there was no clause which in any way corresponded to Article 132 of the present Limitation Act and their Lordships felt constrained to apply the general article far recovery of immoveable property corresponding to the present Article 144 , No one contends that that Article applies in the present case. Furthermore, the Counsel for the appellant was driven to fall back on the omnibus clause 16 for \"suits for which no other limitation is hereby expressly provided,\" corresponding to the present Article 120 , which, it is contended before us, is inapplicable to the present case. In fact, there is a uniform course of decisions in all the that Article 116 of the Limitation Act would be applicable to a mere money claim based on a registered bond, and not the general Article 120. Their Lordships of also have, in the recent case of 39 Ind. Cas. 156 : 25 C.L.J. 279 : 1 P.L.J. 262 : 15 A.L.J. 217 : 32 M.L.J. 357 : 21 M.L.T. 262 : 21 C.W.N. 577 : (1917) M.W.N. 363 : 5 L.W. 654 : 19 Bom. L.R. 450 : 44 C. 759 : 44 I.A. 65 (P.C., accepted the interpretation put on Article 116 in a long series of Indian decisions, and held \"that the compensation for the breach of a contrast\" does not only point to a claim for unliquidated damages but is used in a very wide sense and includes a claim for payment of a certain sum. It is, therefore, obvious that the case of v. 1 C. 163 : 25 W.R. 84 : 3 I.A. 1 : 3 Sar.P.C.J. 58 : 3 Suth. P.C.J. 222 : 1 Ind. Dec. (N.S.) 105 (P.C.) can-not, in any way, be taken to have decided the point which arises before us, nor had their Lordships than to interpret the meaning of the expression when the money sued for becomes due\" which we have to consider. ", "11. Coming to , we find that the decisions have by no means been uniform. We do not, however, feel called upon to review the numerous authorities of the other than our own. We simply content ourselves with mentioning a few cases holding the two opposite views. ", "12. 24 C. 281 : 1 C.W.N. 229 : 12 Ind. Dec. (N.S.) 854; 20 M. 245 : 7 M.L.J. 222 : 7 Ind. Dec. (N.S.) 174 and . v. 2 Ind. Cas. 653 tend to apart the view that time begins to run from the date of the first default. ", "13. 22 M. 20 : 8 M.L.J. 167 : 8 Ind. Dec. (N.S.) 15 and 35 Ind. Cas. 418 : 89 M. 981 : 4 L.W. 77 : 20 M.L.T. 174 : (I916) 2 M.W.N. 125 : 31 M.L. 865 favour the contrary view, ", "14. The case of v. 16 A. 371 : A.W.N. (1894) 115 : 8 Ind. Dec. (N.S.) 241 was the case of execution of an instalment decree for which different considerations altogether might arise. We consider is unnecessary to express any opinion about that case. ", "15. The case of , 29 A. 431 : 4 A.L.J. 336 : A.W.N. (1907) 139 was the case of an instalment bond which was governed by Article 75 which expressly provides that the payee or obligee may waive the benefit of the provision entitling him to sue for the whole amount on default being made. ", "16. The cases of v. 30 A. 123 : 5 A.L.J. 72 A.W.N. 1903 36, and v. 20 Ind. Cas. 933 : 35 A. 455 : 11 A.L.X. 661 are also oases under Article 75 and have no direct application to the present case. ", "17. The leading case in point is the case of 28 Ind. Cas. 910 : 37 A. 400 : 13 A.L.J. 510. In that case the majority of the learned Judges held that money \"becomes due\" within the meaning of Article 132 and time begins to run from the date of the first default. The learned Chief Justice remarked: \"It seems to me that the money is due when it can be legally demanded, and it is admitted in the present case that the money secured by this mortgage could have been legally demanded and recovered after the first default, and had a suit been brought for its recovery by sale of the mortgaged property, the defendants could not have pleaded that such a suit was premature.\" We entirely agree with this view and consider that it lays down the right teat to apply in such cases. , J., in his dissenting judgment, was mainly influenced by the circumstance that, under the terms of the mortgage deed then in suit, the mortgagee was \"competent to wait for the full period of 10 years stipulated in the bond and it is not obligatory on him to call in the money on the occurrence of a default in the payment of the instalmets\". We are, however, distinctly of opinion that the question whether the mortgagee is bound to sue or not and whether he does at once sue or not, is wholly irrelevant to the issue. So long as he can sub, even though he does not choose to sue, the money has become due. We have, therefore, no hesitation in saying that the view taken by the majority of the learned Judges in the case referred to above was correct. ", "18. The case of 63 Ind. Cas. 477 : 19 A.L.J. 406 suggested a rule contrary to that laid down by . Neither the re-port nor the judgment, however, shows that the previous case was brought to the notice of the learned Judges. We shall have to revert to this case in connection with the second point raised in these appeals. ", "19. In the case of 63 Ind. Cas. 25 : 19 A.L.J. 456 the mortgage-deed had provided that, in the event of non-payment of interest for two consecutive half-years, the mortgagees would have the power either to benefit themselves by charging compound interest or to sue without waiting for the period fixed for the whole of the principal and interest or to sue for the interest alone. The learned Judges were of opinion that when three options were given to the mortgagees and they did not choose to exercise the option of suing for the whole amount on default of the payment of two consecutive instalments of interest by the debtor, it cannot be said that the time began to run from such abstention\". The previous case was distinguished on the ground that \"in that case no option, be far as we can Bee from the recital of the terms of the bond given therein, was given to the creditor\". We think that this ground of distinction is not well-founded. In the case the mortgagee was given \"the liberty to realise the entire amount with interest\" and ''if the mortgagee in his desire for interest does not bring a suit on any default, the interest shall continue\" and the judgment of Banerji, J., proceeded on the ground that the mortgagee had such an option. In any case, as we have already remarked above, the mere fact that a mortgagee has the option to sue or to wait would not prevent the money from becoming due and limitation running under Article 132 against him. ", "20. In the case of 63 Ind. Cas. 441 : 19 A.L.J. 592 : 43 A. 596 the Full Bench case was followed, though presumably in deference to the view expressed in the earlier case of 63 Ind. Cas. 25 : 19 A.L.J. 456, a point was made that in the deed in question no option whatsoever was given to the mortgagee in the matter. We have already said that any distinction based on the existence of an option is a distinction without a difference and wag, moreover, an error of fact. An option was given. ", "21. In the case of v. Turn 63 Ind. Cas. 886 : 19 A.L.J. 712 : 43 A. 671 the view expressed in the case of 63 Ind. Cas. 477 : 19 A.L.J. 406 was dissented from on the ground that it was in conflict with the Full Bench case, and it was held that \"the Statute in our view must run from the date of the first default. The liability to pay or, in other words, the Jest of whether money becomes due or not, is the obligation which the borrower has taken upon himself by his signature to the written document. It cannot depend on the volition of the creditor,\" ", "22. The case of 67 Ind. Cas. 160 : 20 A.L.J. 346 : (1922) A.I.R. (A.) 524 is, so far as we have been informed, the latest reported case of this following the previous Fall Bench case, ", "23. Both on principle and the balance of authority, therefore, we are of opinion that the view taken by the is correct and that the first default having occurred more than twelve years before the suit, money sued for became due then and the present claim for the enforcement of the charge is barred by time under Article 132 of the Limitation Act . ", "24. There remains the second question whether even if the mortgagee cannot get a decree for sale he is nevertheless entitled to a simple money-decree, Although the relief for recovery of money otherwise than by enforcing the charge would be governed by another Article with a different period fixed, yet it would be a startling thing to end that the time for recovery of the amount due by sale of the property has begun to run while that for recovering it as a simple debt has not yet started. One would suppose that the cause of action would be the same for both, though different periods might be fixed for the enforcement of the two reliefs. There is one case in which it has been actually held that, although defaults were made yet the mortgagee was not bound to sue for the whole money as soon as there was failure in payment, and, that time did not begin to run till after the date originally fixed. This is the case of 63 Ind. Cas. 477 : 19 A.L.J. 406 already referred to. Let us examine what the decision in this case comes to. The mortgagee has a right to sue for the whole money if a default is made and his suit can-not be thrown out on the ground that it is premature. He has a perfectly good cause of action to sue if he so chooses, yet the limitation does not begin till the date originally fixed arrives The result is that the mortgagee can sue long before the period of limitation for his suit begins to run. This is a reductio ad absurdum, We must, therefore, examine the premises on which the conclusion is based. The learned Judges have not quoted the Article which, in their opinion, was applicable, bat from the remark that the mortgagee had the option to wait till \"the period fixed,\" We take it that they intended to apply Article 66 , read with Article 116 , of the Limitation Act . This would be in harmony with three earlier cases, namely, the case of 39 Ind. Cas. 574 : 15 A.L.J. 313; 50 Ind. Cas. 640 : 17 A.L.J. 647 : 1 U.P.L.R. (A.) 73 : 41 A. 581 and 58 Ind. Cas. 278 : 18 A.L.J. 476 : 2 U.P.L.R. (A) 102. In the last mentioned case , J., while referring to the two earlier cases, remarked whether these decisions are right or wrong, we can see no reason whatsoever, in the present case at any rate, for expressing any opinion to the contrary. One of us was a party to one of these decisions and until these decisions are set aside by a larger Bench, we can see no reason why we should not follow them.\" ", "25. There can be no doubt that the basis of these decisions, namely, that the claim for a personal decree is governed by a different Article and not by Article 132 , and that, therefore, the Full Bench ruling in 28 Ind. Cas. 910 : 37 A. 400 : 13 A.L.J. 510 is inapplicable, is perfectly sound and cannot be questioned. The mistake which was made in 39 Ind. Cas. 574 : 15 A.L.J. 313 was in assuming that it was Article 66 , read with Article 116 , which governed the case. In the subsequent cases referred to above, it was simply taken for granted that Article 66 applied. We think that this was not a correct view. The expression single bond\" used in Article 66 is clearly borrowed from the English Law. In Lord 's Laws of England, Vol. III, page 80, it is said that a bond merely for the payment of a certain sum of money without any condition in or annexed to it, is called a simple or single bond, and that such instruments are rarely, if ever, met with at the present day\"...whereas a \"double\" or \"conditional bond\" is a form of bond accompanied by a condition in the nature of a defeasance providing that on due performance of the condition the bond shall be void. This distinction wag very clearly pointed out by , L. J., in Dixon In re Heynes v. Dixon (1900) 2 Ch. 561 at p. 582 : 69 L.J.C. 609 : 83 L.T. 129 : 48 W.R. 665. ", "26. Now, the bond in the present case in marked contrast with that before the Full Bench in v. 3 A. 600 : A.W.N. (1881) 33 : 6 Ind. Jur. 142 : 2 Ind. Dec. (N.S.) 323 (F.B.) which was obviously a single bond without any condition attached and it was then rightly held that Article 86 , read with Article 116 , applied. The bond in suit in the present case cannot at all be called a single bond within the meaning of Article 66. The period primarily specified for payment is 12 years, but it contains the condition that in case of non-payment from year to year the creditor would either add the interest to the principal and charge interest thereon or sue for the whole money and realise the amount from the property hypothecated as Well as the other property of the mortgagor. It further provides that in case the money is not paid within the stipulated period, compound interest will continue to run till realization. In our opinion such a bond cannot be regarded as a single bond, the time for suing on which runs only from the day specified. ", "27. The expression \"bond subject to a condition\" as used in Article 68 seems also to have been borrowed from the English Law and refers to what is there called a double or conditional bond with a condition in the nature of a defeasance. The bond in question is not such & bond either. Nor is it an instalment bond within the meaning of Article 75. In our opinion the case falls under Article 80 which governs a bond not herein expressly provided for\" in which case the time begins to run from the date when the bond becomes payable\". It is to be noted that in the old Limitation Act XIV of 1859, which governed the sage of v. 1 C. 163 : 25 W.R. 84 : 3 I.A. 1 : 3 Sar.P.C.J. 58 : 3 Suth. P.C.J. 222 : 1 Ind. Dec. (N.S.) 105 (P.C.), there was no clause similar to Article 80 of the new Act which could take the case out of the general clause. Reading Article \u00a30 with Article 116 , which would be applicable to a registered document, the period for recovery of a simple money-decree on the basis of the registered deed in suit would be six years from the date \"when the bond becomes payable.\" Now, the expression \"becomes payable\" is, in our opinion, very much the same thing as the words \"becomes due\" need in Article 132. Consequently, the cause of action for both the reliefs would arise at one and the same time, and the period of limitation for both would begin to run simultaneously. Of course, in the case of the enforcement of the charge, the period would be 12 years, whereas for a simple money decree it would be only 6. ", "28. In a very old case of v. 2 A. 322 : 3 Ind. Jur. 461 : 1 Ind Dec. (n.s. ) 763 , J. was of opinion that a bond, somewhat similar to the one before us, was neither an instalment bond, nor a single bond, nor a bond subject to a condition, and that, therefore, neither Article 75 nor Article 66 nor Article 68 applied. He accordingly applied Article \u00a30. The other learned Judge, however, took a different view. ", "29. In the case of v. 8 O.C. 77 the view of , J., was followed by , , who pointed out that ' a single bond is a deed wherein a party acknowledges himself to be bound or indebted to another in a certain sum of money which he promises to pay. If there is appended to it a condition that upon the performance of a certain act. the bond is to be void, otherwise to remain in force, it is called a bond with a condition.\" ", "30. We are aware that opinion in the various on this point is sharply divided. But agreeing with , and , A. J. C. we hold that the present bond does not fall either under Article 66 or Article 68 or Article 75 bat fills under Article 80 read with Article 116. In this view of the case the time began to run against the mortgagee for both the reliefs claimed from the date of the first default when the money became payable. The learned District Judge was, therefore, right in dismissing the suit in Mo. ", "31. The result is that both these appeals fail and are hereby dismissed with costs in all Courts."], "relevant_candidates": ["0000174631", "0000201545", "0000399102", "0000667599", "0000888208", "0001040261", "0001102290", "0001114727", "0001219329", "0001520872", "0001703849", "0001766429", "0001789504", "0001811127", "0001999527"]} {"id": "0000046064", "text": ["PETITIONER: Vs. RESPONDENT: THE COMMISSIONER OF GIFT TAX, DATE OF JUDGMENT: 17/08/2000 BENCH: S.P. Bhuracha , , & JUDGMENT: ", " ", "L...I...T.......T.......T.......T.......T.......T.......T..J This appeal is by the assessee against the judgment and order dated 25.4.1988 passed by of . It relates to the assessment year 1972- 73. ", ", Hyderabad (for short the `Tribunal' ) had referred the following question under 26(1) of the Gift-tax Act , 1958 (for short the `Act') for the opinion of :- ", "\"Whether on the facts and in the circumstances of the case, the was right in holding that the release by the assessee who was one of the partners in the firm of , of his rights in the assets of the firm for a consideration of Rs. 3,00,000/- when the market value of the assets of the firm in proportion to his share was in excess thereof, did not amount to a gift within the meaning of the Gift-tax Act .\" ", " by the impugned judgment answered the said question in negative and against the assessee. ", "Briefly stated, the facts leading to the filing of this appeal are as follows. ", "The appellant and his brother were the partners of a partnership firm constituted on 9.1.1965 under the name and style of \"\". The firm was engaged in the business of a restaurant in a building known as \"Mohsin-ul-Mulk Kothi\" situated at Abid Road, Hyderabad. ", "An agreement was entered into between the appellant and his brother on 15.4.1971. The terms of the said agreement are set out below: - ", "\"(i) Sri Jagatram (assessee) is to retire before December 31,1971. ", "(ii) Steps are to be taken to finalise accounts relating to the partnership and determination of the amount due to Sri on retirement. ", "(iii)Sri agreed to pay a sum of Rs. 1,50,000 to towards the value of 50% share of the goodwill of the firm. ", "(iv) The above sum of Rs. 1,50,000 payable by Sri Bishanlal to Sri shall be in addition to the sum due to Sri from the partnership at the time of retirement. ", "(v) If the total sum including 50% share value of the goodwill, i.e., Rs. 1,50,000/-, payable to Sri falls below Rs. 3,00,000, the amount in excess of the balance actually due to Sri at the time of retirement shall be treated as the sale value of 50% share of the goodwill belonging to Sri . ", "(vi) Sri shall execute proper conveyance in favour of conveying 50% share in the land and building in which the business of 3-Aces is carried on. ", "(vii)It is open to Sri Bishanlal to classify the sum payable to Sri as between movable and immovable properties and get necessary documents executed by Sri .\" ", "Pursuant to the said agreement, a Deed of Dissolution of the partnership was executed on 22.11.1971 w.e.f. that date. The relevant terms contained in the Deed of Dissolution are given below:- ", "\"(i) All the assets and liabilities of the partnership including the land and building are taken by Sri Bishanlal from November 22, 1971. ", "(ii) Sri renounced his interest, share and interest in the said assets and liabilities from November 22, 1971. ", "(iii)In full settlement and satisfaction of the share, right and interest of Sri in the partnership including land and buildings, profits and goodwill and the amounts standing to the credit of Sri in the partnership accounts as on November 21, 1971, Sri has agreed to receive Rs. 3,00,000. ", "(iv) Out of the said Rs. 3,00,000, Rs. 1,00,000 has already been paid. The balance of Rs. 2,00,000 is payable by against the sale consideration of the undivided 50% share in the land and building known as \"Mohsin-ul-Mulk Kothi\". ", "(v) Sri should immediately execute a sale deed and register the same in favour of Sri conveying his 50% share in the land and building for Rs. 2,00,000.\" ", "It was on 10.3.1972 that the appellant and executed a document styled as `Release Deed' pursuant to and consistent with the aforementioned two documents. ", "Originally assessment of gift tax was made on 12.2.1972 on a total gift of Rs. 70,000/. After allowing exemption of Rs. 5,000/- it was determined at Rs. 65,000/-. Subsequently, the Gift Tax Officer took up the proceedings under Section 16 of the Act, 1958 by re-opening the assessment already made. He valued the share of the appellant in the partnership assets at Rs. 12,67,015/-. An amount of Rs. 3,00,000/- paid by to the appellant was deducted and thus the value of the property alleged to have been gifted by the appellant to his brother was arrived at Rs. 9,67,015/-. On appeal by the appellant, the Commissioner of Gift-tax (Appeals) confirmed the order of the Gift-tax Officer. However, he reduced the total value of the gift by Rs.3,77,000/-. The appellant took up the matter in further appeal before the . The accepted the appeal holding that the distribution of assets between partners on the dissolution of the firm, even though unequal, does not amount to \"transfer of property\" within the meaning of Section 2(xxiv) and therefore, did not amount to \"gift\" as defined in Section 2(xii) of the Act. ", "At the instance of the , the referred the above stated question under Section 26(1) of the Act for the opinion of . referring to the various decisions and for the reasons stated in the impugned judgment took the view in favour of the . ", "In doing so, relied on vs. [1987]166 ITR 124(SC), vs. [1985] 153 ITR 481 (Mad) and vs. [ 1982] 133 ITR 317 (Bom.) distinguishing the other cases, particularly the case of vs. [ 1971] 82 ITR 599(SC) strongly relied on in support of the case of the appellant. ", "At the outset, the learned counsel for the appellant submitted that the appellant is not challenging the valuation of property of alleged gift. Hence, it is unnecessary for us to go into that question. The learned counsel for the appellant seriously contended that manifestly erred in answering the question in favour of the contrary to the ratio and principles stated in the case of (supra). He further submitted that the decisions relied on by in support of its conclusion were not directly on the point and some of them arose under the Estate Duty Act . ", "Per contra, the learned senior counsel for the respondent argued supporting the view taken by . ", "We have carefully considered the submissions made by the learned counsel for the parties. In order to appreciate the respective contentions of the parties and to resolve the controversy we consider it appropriate to extract definitions of \"Gift\" and \"Transfer of property\" from Section 2 of the Act: - ", "\"2 (xii) \"gift\" means the transfer by one person to another of any existing movable or immovable property made voluntarily and without consideration in money or money's worth, and includes the transfer or conversion of any property referred to in section 4 , deemed to be a gift under that section; ", "Explanation. -- A transfer of any building or part thereof referred to in clause (iii), clause (iiia) or clause (iiib) of section 27 of the Income-tax Act, by the person who is deemed under the said clause to be the owner thereof made voluntarily and without consideration in money or money's worth, shall be deemed to be a gift made by such person.\" ", "\"2 (xxiv) \"transfer of property\" means any disposition, conveyance, assignment, settlement, delivery, payment or other alienation of property and, without limiting the generality of the foregoing, includes -- ", "(a) the creation of a trust in property; ", "(b) the grant or creation of any lease, mortgage, charge, easement, licence, power, partnership or interest in property; ", "(c) the exercise of a power of appointment (whether general, special or subject to any restrictions as to the persons in whose favour the appointment may be made) of property vested in any person; not the owner of the property, to determine its disposition in favour of any person other than the donee of the power; and ", "(d) any transaction entered into by any person with intent thereby to diminish directly or indirectly the value of his own property and to increase the value of the property of any other person;\" ", "This Court in 82 ITR 599 SC ], arising under the Act itself construing and considering the very same provisions held that in a Hindu Joint Family by allotting greater share to other members of coparcenary than that to which they were entitled, the assessee could not be held to have made a gift. Facts of the case were that the assessee was the of consisting of himself, his son and his six grandsons. There was a partition in the family property. The total value of the properties divided was Rs.8,51,440/- but the assessee, the took properties worth only Rs.1,78,343/- allotting the remaining properties to other coparceners. After considering various decisions and provisions of law, this Court arrived at the following conclusions:- ", "i) That the partition did not effect any transfer as generally understood in law and did not, therefore, fall within the definition of gift in Section 2(xii) of the Act. ", "ii) That the partition in the family could not be considered to be a disposition, conveyance, assignment, settlement, delivery, payment or other alienation of property within the meaning of those words in Section 2(xxiv) of the Act. iii) That the partition was not a transaction entered into by the assessee with intent thereby to diminish directly or indirectly the value of his own property and to increase the value of the property of any other person and, therefore, Section 2(xxiv)(d) did not apply. (iv) That, therefore, there was no gift by the assessee of which he was liable to pay gift tax. On the reason that a member of Hindu Undivided Family has no definite share in the family property before the division and he cannot be said to diminish directly or indirectly the value of his property or to increase the value of the property of any other coparcener by agreeing to take a share lesser than what he would have got if he would have gone to a court to enforce his claim. ", "The word 'transaction' in clause (d) of Section 2(xxiv) takes its colour from the main clause; it must be a transfer of property in some way. The words disposition, conveyance, assignment, settlement, delivery and payment are all used to indicate some kind of transfer of property. An interpretation clause which extends the meaning of a word does not take away its ordinary and popular meaning. ", "It is settled position in law that a partition of Hindu Undivided Family cannot be considered as a transfer in the strict sense. [(1965) 2 SCR 100 = 55 ITR 637] this Court stated thus: - ", "\"But, is a partition of joint Hindu family property a transfer in the strict sense? We are of the opinion that it is not. This was so held in 1951 Mad. 607]. (then a judge of ), after examining several authorities, came to the conclusion that 'partition is really a process in and by which a joint enjoyment is transformed into an enjoyment in severalty. Each one of the shares had an antecedent title and, therefore, no conveyance is involved in the process, as a conferment of a new title is not necessary.' again examined the question in [41 ITR 297 (Mad.)], with reference to section 16(3)(a)(iv) . It observed that 'obviously no question of transfer of assets can arise when all that happens is separation in status, though the result of such severance in status is that the property hitherto held by the coparcenary is held thereafter by the separated members as tenants-in-common. Subsequent partition between the divided members of the family does not amount either to a transfer of assets from that body of the tenants-in-common to each of such tenants-in-common'.\" ", "This in case aforementioned has stated thus: - ", "\"A reading of this section clearly goes to show that the words \"disposition\", \"conveyance\", \"assignment\", \"settlement\", \"delivery\" and \"payment\" are used as some of the modes of transfer of property. The dictionary gives various meanings for those words but those meanings do not help us. We have to understand the meaning of those words in the context in which they are used. Words in a section of a statute are not to be interpreted by having those words in one hand and the dictionary in the other. In spelling out the meaning of the words in a section, one must take into consideration the setting in which those terms are used and the purpose that they are intended to serve. If so understood, it is clear that the word \"disposition\" in the context means giving away or giving up by a person of something which was his own, \"conveyance\" means transfer of ownership, \"assignment\" means the transfer of the claim, right or property to another, \"settlement\" means settling the property, right or claim conveyance or disposition of property for the benefit of another, \"delivery\" contemplated therein is the delivery of one's property to another for no consideration and \"payment\" implies gift of money by someone to another. We do not think that a partition in a Hindu Undivided Family can be considered either as \"disposition\" or \"conveyance\" or \"assignment\" or \"settlement\" or \"delivery\" or \"payment\" or \"alienation\" within the meaning of those words in s. 2 (xxiv). ", "This leaves us with cl. (d) of S. 2 (xxiv) which speaks of a transaction entered into by any person with intent thereby to diminish directly or indirectly the value of his own property and to increase the value of the property of another person. A member of who, as mentioned earlier, has no definite share in the family property before division, cannot be said to diminish directly or indirectly the value of his property or to increase the value of the property of any other coparcener by agreeing to take a share lesser than what he would have got if he had gone to court to enforce his claim. Till partition, his share in the family property is indeterminate. He becomes entitled to a share in the family property only after the partition. Therefore there is no question of his either diminishing directly or indirectly the value of his own property or of increasing the value of the property of anyone else. The \"transaction\" referred to in cl. (d) of s. 2 (xxiv) takes its colour from the main clause viz., it must be a transfer of property in some way. This conclusion of ours gets support from sub-clause (a) to ", "(c) of clause (xxiv) of s. 2 , each of which deals with one or the other mode of transfer. If intended to bring within the scope of that provision partitions of the type with which we are concerned, nothing was easier than to say so. In interpreting tax laws, courts merely look at the words of the section. If a case clearly comes within the section, the subject is taxed and not otherwise.\" ", "This Court again in [AIR 1966 SC 1300], considering the provisions of Sections 14 , 15 , 29 , 32 , 37 , 38 and 48 of Partnership Act, 1932 has explained as to the nature of property during subsistence of partnership and after its dissolution. It is held that \"from a perusal of these provisions it would be abundantly clear that whatever may be the character of the property which is brought in by the partners, when the partnership is formed or which may be acquired in the course of the business of the partnership it becomes the property of the firm and what a partner is entitled to is his share of profits, if any, accruing to the partnership from the realization of this property, and upon dissolution of the partnership to a share in the money representing the value of the property. No doubt, since a firm has no legal existence, the partnership property will vest in all the partners and in that sense every partner has an interest in the property of the partnership. During the subsistence of the partnership, however, no partner can deal with any portion of the property as his own. Nor can he assign his interest in a specific item of the partnership property to anyone. His right is to obtain such profits, if any, as fall to his share from time to time, and upon the dissolution of the firm to a share in the assets of the firm which remain after satisfying the liabilities set out in . ", "(a) and sub-Cls. (i), (ii) and (iii) of Cl. (b) of S.48.\" ", " 120 ITR 49 SC] this Court considered few provisions of Income-tax Act , 1961. Referring to the case of and other cases expressed the view that a partnership firm under the Indian Partnership Act is not a distinct legal entity apart from the partners constituting it and that in law the firm as such has no separate rights of its own. When one talks of the property or assets of the firm all that is meant is property or assets in which all partners have a joint or common interest. Hence the contention that upon dissolution of the firm rights in the partnership assets are extinguished, cannot be accepted. It is further, held that the partners own jointly or in common the assets of the partnership and, therefore, the consequence of the distribution, division or allotment of assets to the partners which flows upon dissolution after discharge of liabilities is nothing but a mutual adjustment of rights between the partners and there is no question of any extinguishment of the firm's rights in the partnership assets amounting to a transfer of assets within the meaning of Section 2(47) of the Income-tax Act, 1961. Although the case arose under the provisions of Income-tax Act , but as to the nature and character of transaction of mutual adjustment of rights between the partners upon dissolution of a firm, it was clearly held that such a transaction did not amount to transfer. If there is a sale or transfer of assets by the assessee to a person, the position would be different. Since a partner in a firm has no exclusive right on any property of the firm he cannot transfer the property. But upon the dissolution of a firm allotment or adjustment of the assets takes place. Hence there was no element of transfer in such a case. ", "Yet, in another case 68 ITR 240 SC], dealing with the provisions of Section 10(2)(vii) of Income-tax Act again referring to case this Court took the view that a partner might in an action for dissolution insist to sell the assets of partnership to realize his share. But where in satisfaction of the claim of a partner to his share in the value of the residue determined on the footing of an actual or notional sale, the properties so allotted cannot be taken to have been sold to him. ", "On principles and in view of the clear ratio, the decision of (supra) of this Court supported the case of the appellant which decision was rightly applied by the to the facts of the case. in relation to the said decision has stated thus :- ", "\"Be that as it may, it is not for us to express any opinion on the said criticism. By virtue of Article 141 of the Constitution, the said decision and even the observations aforesaid are binding upon us. In our opinion, however, the ratio of the said decision has no application to the distribution of assets as between partners whose shares inter se are specific and determined at any given point of time. Moreover, this decision has to be read and understood in the light of the subsequent decision of in CED vs. 105 ITR 92, which is, no doubt, a case arising under the Estate Duty Act . Section 2(15) of the Estate Duty Act defines \"property\" in the following terms.\" ", " having rightly stated that the said decision and even the observations made were binding on it wrongly did not apply the ratio of the said decision to the facts of the case in hand. Further committed an error in stating that the said decision had no application to the distribution of the assets as between the partners whose shares inter-se are specific and determined at any given point of time and that the said decision had to be read and understood in the light of the subsequent decision of this Court in case. As in the case of , the coparceners do not have exclusive rights on any specific property of the family, the property allotted to their shares become specified only on partition; the same is the position in the case of partner of a firm. No partner of a firm can claim exclusive or specific right in any specific asset of the property of a firm. also have definite share in . So also the partners have definite share in the partnership. In our considered view, the principles stated in case equally apply to case of allotment or adjustment of properties among the partners upon dissolution of a firm. We fail to understand how case made any difference. The said case did not show any disagreement with the principles stated in case and no distinction was made to take a different view. On the other hand, principles stated in case were affirmed. In relation to case, in , it is stated thus:- ", "\"That a case under the Gift-tax Act , 1958, and the construction of section 2(xxiv) fell for decision. Certainly, many of the observations there, read de hors the particular statute, might reinforce the assessee's stand. This court interpreted the expression \"transfer of property\" in section 2(xxiv) and held that the expression \"disposition\" used in that provision should be read in the context and setting of the given statute. The very fact that \"disposition\" is treated as a mode of transfer takes the legal concept along a different street, if one may use such a phrase, from the one along which that word in the Estate Duty Act is traveling. Mr. Justice rightly observed, if we may say so with respect, that: ", "\"Words in the section of a statute are not to be interpreted by having those words in one hand and the dictionary in the other. In spelling out the meaning of the words in a section, one must take into consideration the setting in which those terms are used and the purpose that they are intended to serve.\" (pp.605-606). ", "The word\" transaction\" in section 2(24) of the Gift-tax Act takes its colour from the main clause, that is, it must be a \"transfer\" of property in some way. Since a partition is not a \"transfer\" in the ordinary sense of law, the court reached the conclusion that a mere partition with unequal allotments not being a transfer, cannot be covered by section 2(xxiv) . A close reading of that provision and the judgment will dissolve the mist of misunderstanding and discloses the danger of reading observations from that case for application in the instant case. The language of section 2(15) , Explanation 2, is different and wider and the reasoning of cannot therefore, control its amplitude. It is perfectly true that in ordinary Hindu law a partition involves no conveyance and no question o transfer arises when all that happens is a severance in status and the common holding of property by the coparcener is converted into separate title of each coparcener as tenant-in-common. Nor does subsequent partition by metes and bounds amount to a transfer. The controlling distinction consists in the difference in definition between the Gift-tax Act ( section 2(xxiv) and the Estate Duty Act ( section 2(15) .\" ", "We find that case supports the view taken in case. Added to this, Section 2(15) of the Estate Duty Act, defining \"property\" came up for consideration in case. We may state here itself that the words and expressions defined in one statute as judicially interpreted do not afford a guide to construction of the same words or expressions in another statute unless both the statutes are para-materia legislations or it is specifically so provided in one statute to give the same meaning to the words as defined in other statute. The aim and object of the two legislations, namely, the Gift-tax Act and the Estate Duty Act are not similar. ", " 79 ITR 594 (SC), it is clearly stated that where in the course of dissolution, the assets of the firm are divided between the partners according to the respective shares, by allotting the individual assets or paying the money value equivalent thereof, no transfer is involved and that it is merely a case of distribution of assets. ", "The same view is taken in Addl. 165 ITR 166 (SC) that where a partner retires from a firm and receives his share of amount calculated on the valuation of the net partnership assets including goodwill of the firm, no transfer is involved. ", "We now refer to the cases relied on by to support its view. In CGT vs. [1974] 97 ITR 393 (Guj), this Court reversed the decision of Gujarat and in the light of the facts and circumstances of the case, held that there was a gift for the purpose of the Gift-tax Act . In that case, a firm by name M/s. came into existence with three partners namely, , and with 7 annas, 4 annas and 5 annas shares respectively. During the assessment year 1963-64, under the new deed, retired. The share of remained unchanged. One became a partner with 4 annas share. The share of assessee was reduced to 4 annas. For the remaining 4 annas share, 2 minor sons of were admitted to the benefits of the firm with 12% and 13% interest respectively. There was also no change in the share capital standing in the name of the assessee. As can be seen from the facts stated above, retired and the firm was reconstituted; two minor sons of , one of the partners were admitted to the benefits of the partnership and simultaneously share of said was reduced from 7 annas to 4 annas giving 3 annas share to the minor sons. In this situation when at the time of the reconstitution of the firm, a 3 annas share out of 's 7 annas share in the partnership firm was given to his minor sons it was taken as transfer of property by way of gift and as such it was taxable. Hence the case of did not advance the case of the on the facts of the case before us. ", "The case of was also a case where the assessee's share was reduced and his minor children were admitted to the benefits of the partnership with 8% share in the profits and this case was referred to and approved by this Court in case. The case of is again a case where in the constitution of a firm, minors were admitted to the benefits of the partnership firm. In all these cases, minors were admitted to the benefits of the partnership and if such partner or minor did not bring in capital of his own into the partnership firm corresponding to his share, it was held that the transaction amounted to a gift. But the present case stands entirely on a different footing. It is clearly and merely a case of adjustment or distribution of assets of the firm in regard to share of the appellant on its dissolution and as such no transfer of property was involved in it. ", "Thus, in our view, the High court was not right in applying the decisions in (1) (2) M.K. Kuppuraj, (3) Premji Trikamji to the facts of the case in hand. ", "The cases of this Court in (1) , ( 2) , (3) , (4) and (5) aforementioned fully support the appellant on facts and in the circumstances of the case. ", "Having regard to all aspects and for the reasons stated above, we conclude that committed an error in answering the question in negative i.e. in favour of the and against the assessee-appellant. Hence this appeal is entitled to succeed. The judgment and order of reported in [1988] 172 ITR 632 (AP) are set aside, upholding the order of the . The question aforementioned is answered in the affirmative i.e. against the and in favour of the assessee-appellant. The appeal is ordered accordingly. No costs."], "relevant_candidates": ["0000442162", "0000466149", "0001173575", "0001270973", "0001272959", "0001505286", "0001526873", "0001770635", "0001827392"]} {"id": "0000067667", "text": [", J. ", "1. The question involved in this writ petition is, whether constituted under section 4 of the Sick Industrial Companies (Special Provisions) Act, 1985 (hereinafter referred to as \"the Act\"), has the power to restrain the company from effecting any change in the composition of the board of directors including top managerial personnel pending decision on the question of rehabilitation of the company? The facts, in brief, are as follows : ", "2. The petitioner is one of the promoters of the second respondent-company, namely, . The company was incorporated in the year 1975 as a public limited company under the Companies Act . Mr. , was the managing director from 1975 till May 10, 1985, and Mr. , was the managing director of the second respondent-company between May, 1985, and September, 1991. Mr. , became the managing director from September 28, 1991, and continued till his death on November 20, 1994. There was no managing director for the respondent-company on the date of filing of the writ petition. The total number of directors is eight out of which six were nominated by the financial institutions and Mr. , was appointed by the shareholders and Smt. , wife of the late , was appointed on November 27, 1994, by the board of directors as an additional director. ", "3. The second respondent-company incurred losses and after the death of Mr. , there was total chaos in the management of the company which resulted in mismanagement and also pilferage of funds. On account of the accumulated losses of the company, the company has been declared a sick industrial company by under section 15 of the Act. The first respondent initiated further proceedings under section 17(2) of the Act. On October 30, 1990, the first respondent directed the second respondent to make its net worth positive under section 17(2) of the Act. However, the second respondent could not improve its position even after following the condition laid down by the first respondent and consequently the matter of rehabilitating the second respondent is again before the first respondent. Since the package paid under section 17(2) did not work out the first respondent has decided to take action under section 17(3) of the Act and directed the operating agency to prepare the scheme of rehabilitation by its order dated February 23, 1995. Since the second respondent was functioning without any managing director a section of the shareholders representing more than 10 per cent. of the paid-up capital of the company have lodged a requisition on February 1, 1995, before the second respondent requesting to convene an extraordinary general body meeting of the shareholders for the purpose of appointment of Sri , as managing director of the company. On receiving the requisition the second respondent-company had issued a notice on February 15, 1995, convening the extraordinary general body meeting on March 16, 1995. The notice was sent to all the shareholders of the company. However, some of the directors filed civil suits in O.S. Nos. 56 and 62 of 1995, before the Principal District Munsiff, , seeking injunction restraining the holding of the meeting. Against the orders of the Principal District Munsiff, C.R.P. Nos. 772 and 773 of 1995, were file under article 227 of the Constitution of India and the suits were stayed. However, the first respondent on March 14, 1995, directed the company secretary of the second respondent not to conduct the meeting on March 16, 1995, and threatened the directors with the imprisonment if its orders are violated. Therefore, on March 16, 1995, the meeting was not held. The petitioner and the other shareholders came to know of the order passed by the first respondent on March 16, 1995 at 10.45 a.m. through the notice of the company secretary of the company. Questioning the validity of the order dated March 14, 1995, the present writ petition was filed on various grounds. ", "4. One of the shareholders of the second respondent-company got himself impleaded as he and his relatives who are also the promoters of the company hold 45,000 equity shares of Rs. 10 each in the second respondent-company. He filed a counter-affidavit stating that the first respondent has sanctioned the rehabilitation scheme for the revival of units by its order dated October 30, 1990. Since the second respondent failed to revive the company as per the package, the first respondent reviewed its order, by order dated February 23, 1995, and appointed as the operating agency under section 17(3) and (4) of the Act to prepare a scheme for rehabilitation and revival of the company. The first respondent directed the promoters to furnish all the necessary material along with the minutes of the general body meeting to the operating agency by March 24, 1995. Pending report by the operating agency the first respondent directed \"not to effect any change in the composition of the board of directors including top managerial personnel\". The operating agency by its letter dated March 9, 1995, directed the second respondent-company to obtain prior approval of the financial institutions for the appointment of the managing director. It was also directed that the second respondent should inform the institutions if there is any change in the composition of the board of directors for their approval since the company's rehabilitation scheme is pending with the first respondent that the petitioner is a third party who filed the above writ petition for the benefit of one of the directors and, therefore, it is not in good faith and the petitioner has also an alternative remedy under the Act and, therefore, the writ petition is not maintainable; that one of the directors filed a Statutory Appeal No. 38 of 1995 before the appellate authority and while admitting the same the said authority had not granted any stay and the appeal was posted on June 2, 1995. The second respondent-company constituted a managing committee consisting of chairman and some of the directors of the second respondent-company including representatives of the financial institutions, chief executive officer and senior vice-president (technical) in order to take a decision on all the important problems. A full-time finance director was also appointed on May 6, 1995, who happened to be a nominee of in compliance with the memorandum of understanding. Therefore, there is no urgency for the appointment of a managing director as the affairs of the company are conducted by various professional people under the managing committee constituted for that purpose. Once a reference is made under section 15 of the Sick Industrial Companies (Special Provisions) Act, 1985, by virtue of section 32 , the provisions of the Act will prevail notwithstanding anything contained in the Companies Act . Therefore, the first respondent is competent to pass the impugned order. Further, on a reference made under section 15 an inquiry was conducted under section 16 and the first respondent suggested a package by requesting the management of the company to make its net worth exceed accumulated losses under section 17(2) of the Act on October 30, 1990. Since the company failed to revive the way it was expected, the first respondent appointed as operating agency under section 17(3) and (4) of the Act to prepare a report on rehabilitation and reviving of the company as per guidelines. The operating agency was directed to examine the measures including the change of management, amalgamation of the company with other companies as stipulated under section 18 of the Act. Since the matter is seized by the first respondent in view of section 32 of the Act, the question of holding general body meeting in accordance with section 169 of the Companies Act does not arise. In other words, one of the shareholders supports the action of the first respondent directing the management not to effect any change of management till a view is taken on the rehabilitation of the company. ", "5. Sri , who was elected as the managing director of the second respondent-company in the extraordinary general body meeting conducted on June 15, 1995, got impleaded himself in the writ petition and filed a counter-affidavit disputing the power of the first respondent to issue the impugned proceedings. ", "6. Mrs. , wife of late , who was appointed as a director on November 27, 1994, also got impleaded as a party to the writ petition. She also adopted the stand that the first respondent is competent to pass the impugned proceedings. ", "7. Before referring to the issues raised by various parties the facts which are not disputed are as follows : ", "The managing director of the second respondent-company was Mr. , who expired on November 20, 1994. There are eight directors on the board of directors, out of which six directors are nominated by the financial institutions and out of the remaining two directors are Mr. , appointed by the shareholders and Mrs. , wife of late Sri , appointed on November 27, 1994, by the board of directors as an additional director. The second respondent has been declared as a sick industrial company by the first respondent under section 15 of the Act. The first respondent suggested a package for the purpose of reviving the second respondent-company under section 17(2) of the Act. However, the second respondent-company could not revive itself and, therefore, the first respondent by its order dated February 23, 1995, appointed () as an operating agency and directed to prepare a scheme in Case No. 67 of 1989 in accordance with the provisions of the Act for the purpose of rehabilitating the second respondent-company. By the same order while appointing the as an operating agency on the representation made by Mrs. , stating that no managing director was appointed after the death of the managing director and the company proposing to hold an extraordinary general body meeting on March 16, 1995, and also offering to bring funds for the purpose of rehabilitation which was opposed by the co-promoters, the Board directed that \"no change of management should be made at this stage till the Bench takes a view on the rehabilitation of the company.\" Thereafter, on March 14, 1995, on an application filed by Mrs. , on March 13, 1995, complaining that despite a direction issued by the Board not to make any change in the management, the company was proceeding with the holding of the extraordinary general body meeting for the appointment of the managing director, the Bench passed the following order : ", "\"The Bench has directed you and the board of directors of the company to ensure that the directions given by it at the hearing held on February 23, 1995, restraining the company from effecting any change in the composition of board of directors including top managerial personnel, should be strictly carried out and in the case of failure to comply with the directions , company secretary, who has convened the extraordinary general meeting or any member of the board of directors of the company holding the extraordinary general meeting contrary to the orders of the shall be liable for action.\" ", "8. The petitioner challenges the above proceedings on the ground that the action of the first respondent is contrary to the judgment of in . . Counsel Submitted that under section 169 of the Companies Act it is an absolute right of the shareholders of the company to call for an extraordinary general body meeting and the action of the first respondent is contrary to section 169 of the Companies Act. Counsel also submitted that the first respondent has no power to restrain the company from holding the extraordinary general body meeting as the stage has not yet arisen. Section 32 of the Act, no doubt, says that the provisions of the Act have application notwithstanding anything contained in the Companies Act , but it will be applicable only from the stage when the scheme is framed and not at the stage before framing of the scheme. Counsel submitted in this case the first respondent appointed the and the has not yet framed the scheme and it is in the process of framing the scheme and, therefore, the impugned proceedings are without jurisdiction and are liable to be set aside. ", "9. The question, therefore, is whether the first respondent is competent to issue the impugned proceedings directing the second respondent-company not to make any change in the management of the company. ", "10. In order to consider the issue, it is necessary to refer to the provisions of the Act. The Sick Industrial Companies (Special Provisions) Act , 1985, was constituted for the purpose of detecting the sick and potentially sick companies owning industrial undertakings and to determine preventive, ameliorative, remedial and other measures and for expeditious enforcement of those measures. Section 4 of the Act provides for appointment of a known as to exercise the jurisdiction and powers and discharge the functions and duties conferred or imposed on the by or under the Act. It consists of a chairman and not less than two and not more than fourteen other members, to be appointed by . An appeal lies against the decision of the to constituted under section 5 of the Act. consists of a chairman and not more than three other members, who is or has been a judge of or who is or has been a judge of for not less than five years, and a person who is or has been a judge of or who is or has been an officer not below the rank of secretary to or who is or has been a member of the for not less than three years respectively. Section 13 provides for the procedure of the and . Under section 14 , the proceedings before the or are deemed to be judicial proceedings within the meaning of sections 193 and 228 and for the purposes of section 196 of the Indian Penal Code. Section 15 provides for a reference to be made to the where an industrial company has become a sick industrial company, the board of directors of the company within sixty days from the date of finalisation of the duly audited accounts of the company for the financial year as at the end of which the company has become a sick industrial company for the purpose of determining the measures to be adopted for its revival. Under section 15(2) , or or or a public financial institution or a State level institution or a scheduled bank is authorised to make a reference to the for determination of the measures to be adopted if it has reason to believe that any industrial company has become sick. On such reference having been made the has to make an inquiry under section 16 for determining whether any industrial company has become a sick industrial company. The is also competent to entrust the inquiry to an operating agency and requesting the operating agency to submit a report. The is also empowered to appoint a special director notwithstanding anything contained in the Companies Act under section 16 pending inquiry into the sickness of the company either by itself or by the operating agency. Under section 17 , the is empowered to make suitable orders on the completion of the inquiry. Under section 17(1) , after making an inquiry under section 16 if the is satisfied that a company has become a sick industrial company it shall after considering all the relevant facts and circumstances, decide by order in writing whether it is practicable for the company to make its net worth positive within a reasonable time. The shall by order in writing and subject to such restrictions or conditions as may be specified in the order, give such time to the company as it may deem fit to make its net worth positive. Under sub-section (3) of section 17 , if the decided under sub-section (1) that it is not practicable for a sick industrial company to make its net worth positive within a reasonable time and that it is necessary or expedient in public interest to adopt all or any of the measures specified in section 18 in relation to the said company it may, as soon as may be, by order in writing, direct any operating agency specified in the order to prepare, having regard to such guidelines as may be specified in the order, a scheme providing for such measures in relation to such company. Under section 18 the operating agency has to prepare a scheme providing for various measures mentioned in the said section. Under section 32 , the provisions of the Act and of any rule or schemes made thereunder shall have effect notwithstanding anything inconsistent therewith contained in any other law except the provisions of the Foreign Exchange Regulation Act , 1973 , and the Urban Land (Ceiling and Regulation) Act , 1976 , for the time being in force or in the memorandum or articles of association of an industrial company or in any other instrument having effect by virtue of any law other than this Act. ", "11. The scheme of the Act is, therefore, in the case of a sick industrial company, the board of directors of the company have to make a reference to the for the determination of the measures to be adopted for its revival. On a reference being made under section 15 either by the board of directors or the or or the State or a public financial institution or a State level institution or a scheduled bank, the has to hold an inquiry or it may appoint an operating agency for the purpose of holding an inquiry to determine whether the company has become a sick industrial company or not. On such inquiry being made and on consideration of the relevant facts and circumstances of the case and the report submitted by the operating agency if the is of the view that the company can be revived on its own a reasonable time should be given for making its net worth positive. This is known as package under section 17(1) of the Act. If the company fails on its own or fails to make its net worth positive, within a reasonable time mentioned in the package, the has to appoint an operating agency for the purpose of preparing a scheme for its revival. The operating agency taking into account various circumstances has to suggest measures for its revival. One of the measures to be suggested by the operating agency under section 18 is the change of management of the company. Under section 14 of the Act, the proceedings before the are judicial proceedings, and the provisions of the Act will apply under section 32 of the Act notwithstanding anything contained in any other law for the time being in force except the provisions of the Foreign Exchange Regulation Act , 1973 , and the Urban Land (Ceiling and Regulation) Act , 1976 . ", "12. The facts narrated above disclose that a reference was made by the second respondent-company to the first respondent and the first respondent after holding an inquiry under section 16 of the Act found that the second respondent is a sick industrial company, suggested a package to make its net worth positive within a reasonable time by its order dated October 30, 1990. However, the second respondent-company could not revive itself and, therefore, by its order dated February 23, 1995, the first respondent reviewed its order and appointed as the operating agency for the purpose of framing a scheme under section 18 of the Act. While doing so, the Board directed the second respondent not to bring about any change in the management which was confirmed by its proceedings dated March 14, 1995. ", "13. However, in spite of the directions issued by the first respondent not to effect any change in the management, the shareholders called for an extraordinary general body meeting for the purpose of electing the managing director and, in fact, the election was held on May 16, 1995, and , one of the respondents who was sought to be impleaded was elected as managing director. ", "14. From the facts referred to above, on a reference being made under section 15 of the Act, the is seized of the matter. When the is seized of the matter by virtue of section 32 , the provisions of the Act will prevail notwithstanding anything contained in section 169 of the Companies Act. The argument of learned counsel for the petitioner that section 32 will apply only after the framing of the scheme under section 17 read with section 18 cannot be countenanced as the first respondent enters the picture the moment a reference is made by the board of directors of the company under section 15 or by any financial institutions referred to in section 15(2) for determining the measures to be adopted for reviving the company. The interpretation sought to be placed that section 32 is applicable only when a scheme is framed in accordance with section 17(2) read with section 18 by the operating agency cannot be accepted in view of the express language that \"the provisions of this Act shall have effect notwithstanding anything inconsistent therewith in any other law for the time being in force.\" On the facts of the instant case, a reference was made by the board of directors of the company, an inquiry was conducted and the first respondent found that the company is a sick company and suggested a package and the company could not revive itself and, therefore, the appointed the as the operating agency. In other words, the company, i.e., the second respondent-company invoked the provisions of the Act by making a reference under section 15 of the Act. The first respondent is seized of the matter when a reference is made under section 15 of the Act. The Act is applicable from the day on which a reference is made under section 15 of the Act, i.e., the first stage. It does not say that the provisions of this Act shall have effect after the framing of the scheme. If the intention of the is to give effect to the provisions of the Act notwithstanding anything contained in any other law only after the framing of the scheme then the section would have been differently worded. On the face of the language used in the section, it cannot be said that the provisions of this Act will effect notwithstanding anything inconsistent in any other law only after the framing of the scheme and not before that. ", "15. The next question to be considered is, whether the is exercising quasi-judicial powers? I have already pointed out that an appeal lies to from the decision of the under section 25 of the Act. The or shall, for the purposes of any inquiry or for any other purpose under this Act, have the same powers as are vested in a civil court under the Code of Civil Procedure, 1908, while trying suits as well as are conferred with the powers of the Civil Procedure Code, 1908, namely, summoning and enforcing the attendance of any witness and examining him on oath; the discovery and production of document or other material object producible as evidence; the reception of evidence on affidavit and requisitioning of any public record from any court or office; the issuing of any commission for the examination of witness and any other matter which may be prescribed. I have already pointed out that under section 14 of the Act the proceedings before the or shall be deemed to be a judicial proceeding within the meaning of sections 193 and 228 and for the purposes of section 196 of the Indian Penal Code. The question, therefore, is whether the can be held to be exercising quasi-judicial powers on the ground that the provisions of the Civil Procedure Code were made applicable for various purposes mentioned in section 13(3) of the Act and that the proceedings before the are judicial proceedings within the meaning of sections 193 , 228 and 196 of the Indian Penal Code and that an appeal lies to against any order of the . In this context a classic judgment in v. Federal Commissioner of Taxation AC 275 is relevant, wherein it was observed : ", "\"1. A is not necessarily a court in this strict sense because it gives a final decision. 2. Nor because it hears witnesses on oath. 3. Nor because two or more contending parties appear before it between whom it has to decide. 4. Nor because it gives decisions which affect the rights of subjects. 5. Nor because there is an appeal to a court. 6. Nor because it is a body to which a matter is referred by another body. See v. [1924] 1 KB 171.\" ", "16. The above, no doubt, are the negative propositions for the purpose of determining whether it is a court or a . ", "17. The next decision is the judgment in Cooper v. [1937] 1 KB 309. The relevant observations are as follows : ", "\"In the Report of the Minister's Power Committee (Command Paper 4060 of 1932), P. 73 (S. III, Para. 3) an attempt was made to define the words 'judicial' and 'quasi-judicial' : 'A true judicial decision pre-supposes an existing dispute between two or more parties, and then involves four requisites : (1) The presentation (nor necessarily orally) of their case by the parties to the dispute; (2) if the dispute between them is a question of fact, the ascertainment of the fact by means of evidence adduced by the parties to the dispute and often with the assistance of argument by or on behalf of the parties on the evidence; (3) if the dispute between them is a question of law, the submission of legal argument by the parties; and (4) a decision which disposes of the whole matter by a finding upon the facts in dispute and an application of the law of the land to the facts in dispute and an application of the law of the land to the facts so found, including where required a ruling upon any disputed question of law. A quasi-judicial decision equally pre-supposes an existing dispute between two or more parties and involves (1) and (2), but does not necessarily involve (3) and never involves (4). The place of (4) is in fact taken by administrative action, the character of which is determined by the Minister's free choice.\" ", "18. The next decision to be considered is , 69 CLR 185. The brief facts of the case are as follows : ", "The Women's Employment Regulations set up , with power to decide whether females may be employed on certain classes of work and to decide matters with respect, inter alia, to their hours and conditions of employment and their rates of pay. The board's decision is to be binding on specified employers and employees and organizations of employees and upon being filed in is to have effect as if it were an award or order of that court. Regulation 5c in its original form (as inserted into the Regulations by Statutory Rules 1943, No. 251) authorized committees of reference to determine, in relation to the decisions of , certain facts - namely, facts as to what females are or were employed on work specified in a decision of the board and as to the nature of the work upon which they are or were employed. The regulation made the determinations of committees binding on the employers and on females specified in the determinations, but by amendment made by Statutory Rules, 1944, No. 42, this provision was replaced by a provision that a determination of a committee should be deemed to form part of the decision of the board in relation to which it was made. It was held that neither in its original form nor as amended did regulation 5c have purport to confer judicial power upon committees of reference. The observations made by the majority was : ", "\"These considerations are not conclusive of the case. An industrial award lays down rules of conduct for the future. It does not purport to ascertain and enforce existing rights; it is directed to the creation of new rights.\" ", "19. The next decision to be considered is the judgment in ., . The majority, after referring to the judgments in v. Federal Commissioner of Taxation AC 275, v. 1 KB 309 and . , 69 CLR 185, held that the industrial tribunal is directed within the meaning of article 136 of the Constitution of India. The relevant observations are as follows (p. 196) : ", "\"Such a dispute concerns the rights of employers and employees. Its decision affects the terms of a contract of service or the conditions of employment. Not only may the pecuniary liability of an employer be considerably affected by the adjudication of such dispute but it may even result in the imposition of punishments on him .... ", "It is difficult to conceive in view of these provisions that the industrial tribunal performs any functions other than that of a judicial nature. The tribunal has certainly the first three requisites and characteristics of a court.\" ", "20. It follows from the above decision that the fact that the hears the witnesses on oath or that an appeal is provided against the order of the or because it gives decisions which affect rights of the parties does not make it a quasi-judicial body. The ascertains on a reference made under section 15 of the Act either by the financial institutions of the or or or the board of directors whether a company is a sick company and determine the measures to be adopted for its revival. The may delegate the power to an operating agency to inquire into and report as to the sickness of the company. If, after making such an inquiry under section 16 of the Act, the is satisfied that the company has become sick, it may give an opportunity to the company to make its net worth positive within a reasonable time. If the sick company fails to revive itself on the opportunity given by the , the may appoint an operating agency to suggest measures of revival under section 18 of the Act. The operating agency is appointed under section 17(3) of the Act. One of the measures of revival is any change in the board of directors. Therefore, though, no doubt, the comes into the picture only on an application made to it by the board of directors of the company or or or a Government or a public institution or a level institution or a scheduled bank, the does not decide any dispute between the institutions referred to above or the company as under section 15 of the Act. The object of reference is to ascertain whether the company is sick within the meaning of the Act. As stated in the earlier paragraphs, is suggests a package for its revival to relieve it of its sickness and after it fails to revive itself on the package suggested by the the scheme is prepared. Therefore, the while determining whether a company is a sick company does not exercise any judicial or quasi-judicial powers. In the language of , it lays down the rules of conduct for the future. It does not purport to ascertain and enforce existing rights. Perhaps it is directed to the creation of new rights. Therefore, the does not exercise quasi-judicial powers. If the does not exercise quasi-judicial powers the question of exercising implied or inherent power in the interest of the company does not arise. In other words, the exercises only an administrative function of ascertaining the sickness of the company and framing of a scheme for the purpose of its revival. However, under section 18(1)(f) of the Act while framing a scheme for the purpose of reviving of the company the may exercise such incidental, consequential or supplemental measures as may be necessary or expedient in connection with or for the purposes of the measures specified in clauses (a) to (e). As pointed out, section 18 comes into the picture only when a scheme is framed. Before the scheme is framed the question of exercising incidental, consequential or supplemental measures does not arise. Evidently on the facts of the present case, the scheme has not yet been framed. It is only in the process of framing the scheme. In the light of the view that the board only exercises administrative powers, namely, ascertaining the sickness of the company and suggesting a package for its revival and appoints an operating agency for the purpose of framing a scheme, the board cannot exercise any incidental or consequential or supplemental measure of directing the company not to effect any change in the management. Therefore, the impugned action is outside the scope of sections 15 , 16 and 17 of the Act. Thus it follows from the above that the impugned proceeding is without jurisdiction. In the light of the above, there is no other alternative except to allow the writ petition. ", "21. The writ petition is accordingly allowed. No costs."], "relevant_candidates": ["0000653417", "0000730804", "0080456761"]} {"id": "0000067739", "text": ["JUDGMENT , J. ", "1. This is an appeal by the defendant who has been directed by the decree of the lower Court to pay certain sums of money to the plaintiff, his son, towards maintenance. The plaintiff is an adult and is not under the Hindu Law ordinarily entitled to enforce payment of maintenance as a \"personal\" obligation of the father. Where the father is in possession of joint family property, the adult son is entitled to be maintained from out of the income of the joint family property but it is doubtful if he can maintain a suit for maintenance against the father when he could as well sue for partition. Where the property in the father's possession is impartible the son would not, even if the impartible estate be joint family property, be entitled to sue for partition and in such cases a suit for maintenance has been permitted. ", "2. In the present case the plaint proceeded on the footing that the defendant was in possession of the Uttumalai Zamindari in some character other than that of separate property. The plaint also alleged that there was an immemorial and well-known custom prevalent in the Uttumalai Zamindari and all other Zamindaris according to which a person in the position of the plaintiff was entitled to maintenance. The defendant denied that the plaintiff was entitled to maintenance. He asserted that the Uttumalai Zamindari must be regarded as separate property in his hands and not as joint family property out of which the plaintiff can claim maintenance. He also denied the existence of the custom alleged in the plaint; and, in paragraph 2 of the additional statement filed on the 17th December, 1930, it was distinctly asserted: ", "No such custom has hitherto been recognised in judicial decisions at any rate when the impartible estate is the self-acquired property of the holder. ", "3. In the rejoinder filed by the plaintiff in answer to this statement no new information was vouchsafed, but it was asserted that was in no sense the self-acquired property of the defendant. ", "4. On these allegations, issues were framed, of which it is sufficient to refer to issues 2, 3 and 4. Issue 2 raised the question whether the Uttumalai Zamindari was the joint family property of the parties or the sole property of the defendant. The lower Court rightly found that the property was the separate property of the defendant because he got it by inheritance from his sister's adopted son. This finding has not been attacked before us and it is unnecessary to say more on this issue. ", "5. The fourth issue was to the effect, \"Is that custom true?\". It is to be regretted that the issue was framed in a form which did not bring out the nature of the custom pleaded or required for the purposes of the case. The point really in controversy between the parties on the question of custom was whether there was a custom to pay maintenance even when the property is not held by the holder for the time being, as joint family property; if it was joint family property, the right of the first generation of descendants to maintenance, has not been disputed. This way of framing issue No. 4 has led to an obvious mistake in the treatment of the case in the lower as we shall presently show. ", "6. The third issue ran as follows: ", "If the second issue is found for the defendant, is plaintiff entitled to have that Zamindari taken into consideration in the fixing of the maintenance allowance to be awarded to him assuming the custom alleged by him to be true? ", "7. Issues 1 to 3 were heard as preliminary issues. On the third issue the learned Subordinate Judge curiously enough said that the defendant had made no distinction in his additional written statement as between Zamindaris which are held as joint family properties and Zamindaris which are self-acquisitions so far as the allegation as to the custom was concerned. He forgot that the plaint itself made very little differentiation between judicial decision and custom and the written statement accordingly followed the same lines. It is however obvious from the paragraph which we have already quoted from the additional written statement that the defendant did insist that the plaintiff was not entitled to maintenance if the Court should hold that the Zamindari in his hands was not joint family property. ", "8. The learned Subordinate Judge disposed of issue 3 in two sentences which we have had great difficulty in understanding. He said: ", "Their Lordships of the Privy Council have referred in (1927) 53 M.L.J. 30 at 37 : L.R. 54 I.A. 289 : I.L.R. 54 Cal. 955 at 968 (P.C.) to the expression of opinion in (1918) 35 M.L.J. 392 : L.R. 45 I.A. 148 I.L.R. 41 Mad. 778 (P.C.), though that expression of opinion has been stated in (1921) 40 M.L.J. 387 : L.R. 48 I.A. 195 : I.L.R. 43 All. 228 (P.C.) to be obiter. Consequently I have to find the issue for the plaintiff. ", "9. The learned Counsel who appeared for the respondent before us has explained this judgment of the learned Subordinate Judge to mean that according to the observations of their Lordships in (1918) 35 M.L.J. 392 : L.R. 45 I.A. 148 I.L.R. 41 Mad. 778 at 785 (P.C.) the son of the holder of an impartible estate has been recognized to be entitled to maintenance without the necessity of proving the custom in each case and as that decision proceeds upon the footing that in an impartible estate there are neither coparcenary rights nor any of the incidents relating to joint family property, the observations justify the award of maintenance to the son irrespective of the question whether the impartible estate in the possession of the father is joint family property or separate property. The learned Judge however recognised that Lord himself in (1921) 40 M.L.J. 387 : L.R. 48 I.A. 195 : I.L.R. 43 All. 228 at 243 and 244 (P.C.) stated that many of the observations in (1918) 35 M.L.J. 392 : L.R. 45 I.A. 148 I.L.R. 41 Mad. 778 at 785 (P.C.) might have to be ragarded as obiter. But as reference has been made in Pro tap (1927) 53 M.L.J. 30 at 37 : L.R. 54 I.A. 289 : I.L.R. 54 Cal. 955 at 968 (P.C.) to (1918) 35 M.L.J. 392 : L.R. 45 I.A. 148 I.L.R. 41 Mad. 778 at 785 (P.C.) he thought he must follow the dictum in that case. ", "10. When the case came on before another Judge for the trial of the other issues in the case, the learned Counsel for the defendant asked for a separate trial and finding in respect of Issue No. 4. But the then Judge felt himself precluded from dealing with the question because of what he considered to be the implication of the finding already recorded by his predecessor on the third issue. He was good enough, however, in justice to the defendant, as he says, to refer to some of the contentions raised before him, but refrained from giving a finding on the point. Feeling himself precluded from dealing with the question of the plaintiff's right to maintenance, the new Subordinate Judge practically confined himself to the question of the amount of maintenance and other incidental matters. ", "11. In the course of the argument before us, Mr. has drawn our attention to the relevant decisions of and of all the Courts in India. More than one recent judgment of their Lordships has attempted to state with precision the result of the cases relating to impartible estates; it is therefore not necessary for us to refer to earlier decisions. Taken out of its context, the observation in (1918) 35 M.L.J. 392 : L.R. 45 I.A. 148 I.L.R. 41 Mad. 778 at 785 (P.C.) is no doubt capable of being understood in the way that the learned Subordinate Judge understood it. But a perusal of the whole judgment and a consideration of their Lordships' later judgments will show that that view is not correct. ", "12. It is unnecessary for the purposes of this case to discuss the exact basis of the decision in (1918) 35 M.L.J. 392 : L.R. 45 I.A. 148 I.L.R. 41 Mad. 778 at 785 (P.C.) because in the later decisions in (1921) 40 M.L.J. 387 : L.R. 48 I.A. 195 : I.L.R. 43 All. 228 (P.C.) and (1934) 67 M.L.J. 274 : L.R. 61 I.A. 286 : A.I.R. 56 All. 468 at 485 (P.C.), their Lordships have themselves attempted to state the position with the necessary qualifications. It is sufficient to refer to the observation in (1934) 67 M.L.J. 274 : L.R. 61 I.A. 286 : A.I.R. 56 All. 468 at 485 (P.C.) that it has been clearly shown: ", "That there is now no reason why the earlier judgments of the should not be followed, such as, for instance, the case, (1900) 10 M.L.J. 294 : L.R. 27 I.A. 151 : I.L.R. 24 Mad. 147 (P.C.), which regarded their right to maintenance, however limited, out of an impartible estate as being based upon the joint ownership of the junior members of the family. ", "13. We may also add that the observation in (1918) 35 M.L.J. 392 : L.R. 45 I.A. 148 I.L.R. 41 Mad. 778 at 785 (P.C.) that has been relied on by the learned Subordinate Judge and by the learned Counsel for the respondent before us does not itself purport to declare the right to maintenance but merely refers to the basis on which the right recognised in the earlier cases in respect of maintenance might be based, the suggestion being that custom rather than joint family right might be regarded as the basis. It was obviously not the effect or the intention of the sentence to recognise the right to maintenance in cases where no such right has been recognised in the earlier cases. Mr. admitted before u\u00a7 that in none of the earlier cases relating to impartible Zamindaris has the recognised a right in an adult son to claim maintenance from the impartible Zamindari in the hands of the father even when it was not joint family property. ", "14. We may refer in this connection to an observation in Sir 's book, 8th Edn. at page 611 where a sentence from (1918) 35 M.L.J. 392 : L.R. 45 I.A. 148 I.L.R. 41 Mad. 778 at 785 (P.C.) is reproduced without the context in which it occurs. As it stands, the statement in the book is capable of being misread as supporting a general right to maintenance in favour of the son irrespective of the question whether the impartible estate in the father's hands is joint family property or not. (1934) 67 M.L.J. 306 : I.L.R. 57 Mad. 1023 (F.B.) a Full Bench of this Court affirmed the principle that the right to maintenance which the son of the holder of an impartible Zamindari possesses is only an incident attaching to its character as joint family property. ", "15. The observations in v. (1879) I.L.R. 5 Cal. 256 are likewise capable of being misunderstood if the context is ignored. The antethesis drawn in that judgment was between claims by the younger sons against their elder brother on the one hand and claims by the descendants of the younger brother against their uncle. The son's claim against the father was not then before the . It is obvious that when one of three brothers inherits an impartible estate from the father, it would be an estate where the younger brothers had lost their right of succession only by reason of its impartibility. In such circumstances the thought that the younger sons would be entitled to maintenance without proof of special custom, but they added that as regards members belonging to a lower generation there must be definite proof of custom. ", "16. We may refer in passing to the way in which the matter has been dealt with in a recent enactment of . In Madras Act XII of 1934 which attempted to declare the law as it has been understood even prior to the decision in (1918) 35 M.L.J. 392 : L.R. 45 I.A. 148 I.L.R. 41 Mad. 778 (P.C.) and in conformity with the latest pronouncements of their Lordships as regards the true character of impartible estates, the second section which pro-pose's to add Section 9 to the Impartible Estates Act of 1904 is limited to cases where the estate has for the purpose of succession to be regarded as the property of the joint family. There is accordingly no warrant for Mr. 's suggestion that there is a kind of consciousness in this presidency that a 's son should be entitled to maintenance from his father irrespective of the question whether in the father's hands the i is joint family property or not. It is not suggested that the evidence in this case establishes any custom to that effect. The decision of the lower Court in favour of the plaintiff is accordingly unsustainable. ", "17. Mr. suggested two other grounds in favour of the plaintiff's claim, on ", "18. The offer in the written statement is more in the nature of a voluntary undertaking and does not amount to any admission of a legal right; that undertaking is coupled with onditions which no Court of law can enforce, namely, that the plaintiff should behave in a particular way and be amenable to the defendant. No decree could be founded on such an offer. ", "19. The appeal must accordingly be allowed and the suit dismissed with costs both here and in the below."], "relevant_candidates": ["0000082058", "0000144847", "0000572278", "0000841670", "0001733204", "0001798717"]} {"id": "0000092507", "text": ["PETITIONER: UNION OF INDIA AND . Vs. RESPONDENT: DATE OF JUDGMENT04/09/1991 BENCH: RAMASWAMI, V. (J) II BENCH: RAMASWAMI, V. (J) II SHETTY, K.J. (J) YOGESHWAR DAYAL (J) CITATION: 1992 AIR 96 1991 SCR (3) 873 1992 SCC Supl. (1) 323 JT 1991 (3) 608 1991 SCALE (2)481 CITATOR INFO : E&D 1992 SC2014 (23) ACT: Judges (Conditions of Service) Act , 1954: Paragraphs 2, 9, Part I of First Schedule, Section 17-A --Pension payable to retired Judge of --Fixing of minimum service of seven years-Fixing of lesser pension to those not eligible--Whether discriminatory- Amending Act of 1986--Whether applicable to all Judges irrespective of their dates of retirement. Judicial Act ivism: Invoking of judicial activism to set at naught legislative judgment--Whether subversive of the constitutional harmony and comity of instrumentalities-- to carry out the obvious intention of legislature--not to legislate itself. HEADNOTE: The Respondent retired as Judge of on 3.10.1983 on superannuation and elected to receive his pension under Part I of the First SChedule to the Judges (Conditions of Service) Act , 1954. As a Judge of the , he had put in service of 5 years 10 months and 17 days and his pension was determined at Rs.8,400 p.a. and family pension at Rs.250 p.m. In 1986, the Act was amended providing for an increased pension from 1.11.1986. Thereafter, the Respondent filed a Writ Petition before the praying for directions that he was entitled to refixation of his pension from the date of his retirement at Rs.9,600 per annum on the basis that the period of his service for pension was fit to be enlarged to six years, by addition of 1 month and 13 days; that from November 1, 1986 his pension may be refixed at Rs.20,580 per annum at the rate of Rs.3,430 for six complet- ed years of service; and that the family pension admissible to his wife be calculated on the basis that he had completed six years of service. During the pendency of the Writ Petition the Respondent made representations to that since the respondent fell short of 6 completed years of service only by 1 month and 13 days, the President may be pleased to allow him to add the period so as to 874 caluclate the pension, gratuity and family pension on the basis of 6 completed years of service as a Judge. By its order dated April 16, 1987 rejected the representation of the respondent among other grounds that the request was belated. By its judgment dated March 15, 1988 the allowed the Writ Petition directing the to retix his pension, family pension and gratuity treating him as having put in six completed years of service. has preferred the present appeal, by special leave against the 's order. It was contended on behalf of the appellants that the has re-written the retirement benefit provisions of the First Schedule to the Act which it was not entitled to and hence the refxation of the pension on that basis was wholly illegal and unconstitutional- However, during the pendency of the appeal this in its proceedings dated December 15, 1988 the directed, after obtaining the necessary sanction from the President under Section 16 of the Act, the addition of 1 month and 13 days subject to the final decision of this in the appeal. However, it was added that the period shall be disregarded in calculating additional pension. if any, under Part I, Part II and Part III of the First Sched- ule of the said Act. Allowing the appeal, this . HELD: 1. It is a well-known practice in pensionary schemes to fix a minimum period for purposes of pension. What shall be the minimum period for such pension will depend on the particular service, the age at which a person could enter into such service. the normal period which he is expected to serve before his retirement on superannuation, and various other factors. There is nothing in evidence to suggest that the period of seven completed years of service fixed for pension is arbitrary. So far as the Judges of the are concerned even under Act a period of seven completed years of service before superannuation was prescribed for eligibility for pension. In fact no pension was provided for those who had not com- pleted seven years of service under pre-constitutional scheme. Thus there are historical grounds or reasons for fixing not less than seven years of service for pension. Part I deals with pensionary scheme. Prescribing a minimum period of service before retirement on superannuation, for pension is the very scheme itself and not a classification. It is a qualification for eligibility. It is different from computation of pension. All those who 875 satisfy that condition are eligible to get pension. [885G-H; 886A-C] 2. Even those who had completed seven years of service were not given pension for all the completed years of serv- ice at the rate of Rs.1,600 per annum and a maximum limit has been fixed for purposes of pension. If one calculates the maximum amount provided with reference to the rate per year roughly in about 14 years of service one would have reached the maximum amount. Any service above that period is not taken into account. Thus a person who had put in the minimum period for getting the maximum pension could be said to be favourably treated against the person who had put in more number of years of service than needed for the maximum pension and thereby discriminated. [886D-E] 3. It is not correct to state that the amount of pension provided in paragraph 9 is minimum pension. The said para- graph does not use the word 'minimum' but only states that if a Judge retires without being eligible for pension under any of the provisions. notwithstanding anything contained in the other provisions. the pension of a particular amount mentioned therein shall be paid to the Judge. This amount is not calculated or has any reference to any period of serv- ice. A Judge who had put in only two years of service before retirement will also receive the same amount as that of a Judge who has completed six years of service. If the provision is struck down as unconstitutional the condition relating to completion of seven years of service in para- graph 2, all those who had put in less than six completed years of service would be seriously affected and paragraph 9 also would become inapplicable. Further, it may be open to those who have put in more than five years or more than four years as the case may be. to contend that they are discrimi- nated against because persons who had put in less than that period will get pension at much higher rate. [886F-H: 887A] 4. The Amending Act 38 of 1980 provided that the amend- ed liberalised pension scheme would apply only to a Judge who has retired on or after the commencement of the and Supreme Judges (Conditions of Service) Amendment Act . 1986. A similar provision which made the amendment 01 1976 applicable only to those Judges who have retired on or after October 1. 1974 was struck down as ultra vires and it was decided that the benefit of the amendment was available to. all the retired Judges irrespective of the date of retirement but subject to the condition that the enhanced pension was payable only with effect from October 1, 1974. The Amending Act of 1986 could not restrict the applicability of the amended provision to only those who have retired on or after the commencement of the Amending Act . It 876 would be applicable to all the Judges irrespective of the dates of retirement and they would be entitled to be paid pension at the rates provided therein with effect from November 1, 1986. [883A- . 3 SCR 550; , 3 SCR 552 and , 2 SCR 165, referred to. 5. In the instant case. had exceeded its jurisdiction and power in amending and altering the provi- sions of paragraph 2 by substituting different minimum period for eligibility for pension in paragraph 2 of Part I. Since the respondent has not put in seven completed years of service for pension he will be eligible for pension at the rates provided in paragraph 9 of Part I of the First Sched- ule to the Act, that is to say for the period from 4.10.1983 to 31.10.1986 at the rate of Rs.8,400 per annum and for the period on and from November 1, 1986 at the rate of Rs. 15,750 per annum. [887B-C] 6. Since in compliance with the mandamus issued by the , the President of India was pleased to sanction the addition of one month and 13 days to the service of the respondent to make it six years of completed service subject to the final decision in this appeal, this does not go into the question whether the was right in set- ting aside the earlier rejection for addition of the period. The addition of one month and 13 days does not make any difference in calculation of pension it is relevant only for the purpose of calculating the gratuity under section 17A(3) of the Act. As the period was less than three months and as the President was pleased to sanction the addition in exer- cise of his power under Section 16 of the Act though subject to the final decision of this it is just and necessary to allow this addition to remain for the purposes of calcu- lation of gratuity, and family pension only though not for pension. The respondent will be entitled to fixation of family pension and for payment of gratuity calculated on the basis of his having completed six years of service. [887D-H] 7.1. It is not the duty of the either to enlarge the scope of the legislation or the intention of the legis- lature when the language of the provision is plain and unambiguous. The cannot rewrite, recast or reframe the legislation for the very good reason that it has no power to legislate. The power to legislate has not been conferred on the courts. The cannot add words to a statute or read words into it which are not there. Assuming there is a defect or an omission in the 877 words used by the legislature the could not go to its aid to correct or make up the deficiency. s shall decide what the law iS. and not what it should be. The of course adopts a construction which will carry out the obvious intention of the legislature but could not legislate itself. But to invoke judicial activism to set at naught legislative judgment is subversive of the constitutional harmony and comity of instrumentalities. [885A-D] 7.2 Modifying and altering the scheme and applying it to others who are not otherwise entitled to under the scheme, will not also come under the principle of affirmative action adopted by courts some times in order to avoid discrimina- tion. What the has done in this case is a clear and naked usurpation of legislative power. [885F] , 1 SCR 482; , 5 SCR 239; , Supp. 1 SCR 489; , Shahjahanpur, SCR 1122; ., SCR 533; , 2 SCR 146; S. Narayanaswa- mi v.G. Pannerselvam & Ors., 1 SCR 172; N.S. Varda- chari v. G. Vasantha Pai & Anr., 1 SCR 886; ., 1 SCR 423 and , 2 SCR 430, relied on. JUDGMENT: ", "CIVIL APPELLATE JURISDICTION: Civil Appeal No. 3674 of 1988. ", "From the Judgment and Order dated 15.3.1988 of in Civil Misc. Writ Petition No. 20328 of 1986. ", ", and for the Appel- lants. ", "-in-person and Mrs. for the Respondents. ", "The Judgment of the Court was delivered by , J. The respondent was elevated as Judge of on November 17, 1977. He retired on October 3, 1983 on superannuation at the age of 62. He had elected to receive his pension under Part I of the First Schedule to the High Court Judges (Conditions of Service) Act , 1954. As he had put in only a period of five years 10 months and 17 days service as a Judge. of , under paragraph 9 Part I of the First Schedule pension payable was determined at the rate of Rs.8,400 per annum and the family pension in the event of his death earlier than his wife at Rs.250 per month in the letter of Accountant General, Allahabad dated December 2, 1983. The gratuity was worked out at Rs. 11,665.66 P. in lump-sum under Section 17A(3) also on the ground that he had put in only five completed years of service. The pension was payable with effect from October 4, 1983. The Act was amended by the Amending Act No. 38 of 1986 providing for an increased pension with effect from November 1, 1986. On December 10, 1986 the petitioner filed a writ petition before under Article 226 of the Constitution praying for an order or directions declaring (i) that he was entitled to refixation of his pension from the date of his retirement, namely, October 4, 1983 to October 31, 1986 at Rs.9,600 per annum plus dearness allowance admissible under the rules from 'time to time on the basis that the period of his service for pension was fit to be enlarged to six years, by addition of 1 month and 13 days to the 5 years 10 months and 17 days; (ii) for refixa- tion of pension for the period from November 1, 1986 at Rs.20,580 per annum plus dearness allowance or other allow- ances as may be admissible under the rules from time to time, at the rate of Rs.3,430 per annum for six completed years of service as stated above; (iii) to retix the family pension admissible to his wife on the scale allowed under Section 17A as amended by Act 38 of 1986 again taking the period of completed years of service as 6 years and not as total service of 5 years, 10 months, and 17 days. During the pendency of the writ petition the respondent made representations to stating that since the respondent fell short for 6 completed years of service only by one month and 13 days, the President may be pleased to allow him to add the period so as to calculate the pension, gratuity and family pension on the basis of 6 completed years of service as a Judge. By its order dated April 16, 1987 rejected the repre- sentation of the respondent among other grounds that the request was belated. By its judgment dated March 15, 1988 allowed the writ petition directing the to retix his pension, his family pension and gratuity treating him as having put in six completed years of service and in the manner provided in the judgment. The main grievance of in this appeal is that has rewritten the retirement benefit provisions of the First Schedule to tile Act which it was not entitled to and the refixation of the pension on that basis was wholly illegal and unconstitutional. Since issued the manda- mus directing the to add one month and 13 days to the total length of service renderred by the re- spondent as Judge of for the com- puting the pension under Section 16 of the Act, during the pendency of the appeal in this Court in the proceedings dated December 15, 1988 the directed, after obtaining the necessary sanction from the President under Section 16 of the Act, the addition of one month and 13 days \"subject to the final decision of this Court in Special Leave Petition 6798 of 1988 (CA No. 3674 of 1988).\" However, they added that the period shall be disregarded in calculat- ing additional pension, if any, under Part I and Part II and Part HI of the First Schedule of the Said Act. In order to appreciate the argument of the learned counsel for the appellant- it is necessary to set out certain provisions relating to pension payable to a Judge of on his retirement. Clause 17 of (High Court Judges) Order, 1937 relating to pension payable to a Judge on his retirement which was in force prior to the coming into force of the Constitution provided that \"a pension shall be payable to a Judge on his retirement if, but only if, either: ", "\"(a) he has completed not less than 12 years' service for pension; or ", "(b) he has completed not less than 7 years' service for pension and has attained the age of sixty; or ", "(c) he has completed not less than 7 years' service for pension and his retirement is medically certified to be necessitated by ill-health.\" ", "Thus it may be seen that under the provisions then existing a Judge who had completed less than seven years of service was not allowed any pension. ", "As we are concerned in this case to the provisions applicable to a Judge to whom Part I of the First Schedule of Judges (Conditions of Service) Act, 1954 is applicable either by reason of his appointment directly to from the or who has elected to receive pension payable under that part we need to set out only relevant provisions relating to pension in Part I of the First Schedule. Paragraphs 2, 3, 4, 5, and 9 as stood prior to its amendment by Act 35 of 1976 read as follows: ", "\"2. Subject to the other provisions of this part, the pension payable to a Judge to whom this Part applies and who has completed not less than seven years of service for pension shall be the basic pension specified in para- graph 3 increased by the additional pension, if any, to which he is entitled under para- graph 5. ", "3. The basic pension to which such a Judge shall be entitled shall be-- ", "(a) for the first seven completed years of service for pension, Rs.5,000 per annum; and ", "(b) for each subsequent completed year of service for pension, a further sum of Rs. 1,000 per annum: ", "provided that the basic pension shall in no case exceed Rs. 10,000 per annum. ", "4. For the purpose of calculating additional pensions, service as a Judge shall be classi- fied as follows:- ", "Grade I. Service as Chief Justice in any ; ", "Grade II. Service as any other Judge in any . ", "5. For each completed year of service for pension in either of the grades mentioned in paragraph 4, the Judge who is eligible for a basic pension under this Part shall be enti- tled to the additional pension specified in relation to that grade in the second column of the table annexed hereto. ", "provided that the aggregate amount of his basic and additional pension shall not exceed the amount specified in the third column of the said table in relation to the higher grade in which he has rendered service for not less than one completed year. ", "TABLE Service Additional pension Maximum aggregate per annum pension per annum Rs. Rs. Grade I 740 20,000 Grade II 740 16,000 ", "9. Where a Judge to whom this Part applies, retire or has retired at any time after the 26th January, 1950 without being eligible for a pension under any other provision of this Part, then, notwithstanding anything contained in the foregoing provisions, a pension of Rs.6,000 per annum shall be payable to such a Judge. ", "Provided that nothing in this paragraph shall apply-- ", "(a) to an additional Judge or acting Judge; or ", "(b) to a Judge who at the time of his appoint- ment is in receipt of a pension (other than a disability or wound pension) in respect of any previous service under the or a . Note: The was added by Act No. 46 of 1958.\" ", " By the Amending Act 35 of 1976 the First Schedule was amended by substituting paragraphs 2 and 9 and deleting paragraphs 3, 4 and 5. The substituted paragraphs 2 and 9 read as follows: ", "\"2. Subject to the other provisions of this Part, the pension payable to a Judge to whom this Part applies and who has completed not less than seven years of service for pension shall be-- ", "(a) for service as Chief Justice in any High Court, Rs.2,400 per annum; and ", "(b) for service as any other Judge in any High Court, Rs. 1,600 per annum: ", "provided that the pension shall in no case exceed Rs.28,000 per annum in the case of a Chief Justice and Rs.22,400 per annum in the case of any other Judge. ", "882 ", "9. Where a Judge to whom this Part ap- plies, retires or has retired at any time after the 26th January, 1950 without being eligible for pension under any other provision of this part, then, notwithstanding any- thing contained in the foregoing provi- sions, a pension of Rs.8,400 per annum shall be payable to such a Judge. Provided that nothing in this paragraph shall apply-- ", "(a) to an additional Judge or acting Judge; or ", "(b) to a Judge who at the time of his appoint- ment is in receipt of a pension (other than a disability or wound pension) in respect of any previous service under the or a .\" ", "These amended provisions Were held applicable in respect of all the Judges of who have retired irre- spective of their dates of retirement in the decisions of this Court in , 3 SCR 550 and , 3 SCR 552. However the increased pension was payable only with effect from October 1, 1974, Part I of the First Schedule was further amended by Act 38 of 1986 with effect from November 1, 1986 and the amended paragraph 2 reads as follows: ", "\"2. Subject to the other provisions of this Part, the pension payable to a Judge to whom this Part applies, and who has completed not less than seven years of service for pension shall be--- ", "(a) for service as Chief Justice in any High Court, Rs.4,500 per annum for each completed year of service; ", "(b) for service as any other Judge in any , RS.3,430 per annum for each completed year of service: ", "provided that the pension shall in no case exceed Rs.54,000 per annum in the case of a Chief Justice and Rs.48,000 per annum in the case of any other Judge.\" ", " The Act further amended paragraph 9 by substituting Rs. ", "15,750 for the figure Rs.6,000- ", "883 ", "At this stage itself, we may note that this Amending Act 38 of 1986 provided that the amended liberalised pension scheme would apply only to a Judge \"who has retired on or after the commencement of and Judges (Conditions of Service) Amendment Act , 1986.\" A similar provision which made the amendment by Act 35 of 1976 applicable Only to those judges who have retired on or after October 1, 1974 was held ultra vires and struck down in the two decisions of this Court above referred to and it was held that the benefit of the amendment was available to all the retired judges irrespective of the date of retirement but subject to the condition that the enhanced pension was payable only with effect from October 1, 1974. That was also ratio of the decision of of this Court in , 2 SCR 165. On the same reasoning and logic we have to hold that Amending Act . 38 of 1986 could not restrict the applicability of the amended provision to only those who have retired on or after the commencement of the Amending Act . The resultant position would be that the provisions of pension in Part I of First Schedule as amended by Act 38 of 1986 would be applicable to all the Judges irrespective of the dates of retirement and they would be entitled to be paid pension at the rates provided therein with effect from NOvember 1, 1986, As already stated, the respondent retired from service on October 3, 1983. For the period from October 4, 1983 till October 31, 1986 the respondent claimed that he is entitled to be paid at the rate of Rs.9,600 and at the rate of Rs.20,580 per year from November 1, 1986 when the Amending Act 38 of 1986 came into force, plus the usual dearness allowance admissible from time to time. This claim was made on the ground that the power of the President under Section 16 of the Act though discretionary could not be exercised arbitrarily or on extraneous or other unsupportable grounds that on the facts and circumstances the refusal to include the period of one month and 13 days to the length of his service by the order of 'the dated April 16, 1987 was illegal and on the facts and circumstances, his case is a fit one for enlarging the period of his service to six years. On the assumption that he is entitled for such en- largement and the had completed six years of service, the further case of the respondent was that he is entitled for calculation on the pension at the rate of Rs. 1,600 for each completed year of service and for six.years at Rs.9.600 per annum for the period prior to November 1, 1986. He further contended that in paragraph 2 of Part I of the First Sched- ule the words \"who has completed not less than seven years of service for pension'' shall be read as \"who has completed more than five years of service for pension\" on the ground that while a Judge who has completed seven years of service is permitted to calculate at the rate of Rs. 1,600 for each completed years of service, a person who had not completed seven years of service could not be denied that benefit. But finding that a person who had completed only five years of service or less than five years of serv- ice, if the pension is to be calculated at the rate of Rs. 1,600, would get Rs.8,000 or less than Rs.8,000 though Rule 9 provided for a fixed pension of Rs.8,400 per annum for those who had not completed seven years of service, he wanted to read \"not less than five years\" of service in paragraph 2 as \"more than five years\" of service. This argument was accepted by on the ground that there is no rational basis for depriving a Judge who had put in six completed years of service to calculate the benefit of pension at the rate of Rs. 1,600 per year of service which was provided for those who had completed seven years of service. was of the view denying the benefit of calculation at the rate of Rs. 1,600 per year would lead to the striking down of the provision as a dis- criminatory piece of legislation and that however the provi- sion can be saved by \"reading down paragraph 2 of Part I of the First Schedule to the Act and reading 'more than five years' in the place of not less than seven years.\" In that view amended paragraph 2 so to say by substi- tuting the words \"not less than 7 years\" as \"more than 5 years\" and allowed the claim for payment of pension at Rs.9,600 per annum for the period from 4.10.1983 to 31.10.1986. ", "As already stated as per the Amending Act 38 of 1986 the pension payable for those who have completed 7 years of service was to be calculated at the rate of Rs.3,430 for each completed year of service and for those who have not completed 7 years of service a sum of Rs.15,750 was payable as pension. On the same reasoning which prompted to read \"less than seven years\" as \"more than five years\" in the provision which was in force prior to November 1, 1986 further held that since in four years service the Judge would have earned Rs. 13,720 and on com- pletion of five years service he would have earned Rs.17,150 calculated at the rate of Rs.3430 per annum as against a sum of Rs.15,750 provided in paragraph 9, necessarily paragraph 2 will have to be read down by providing instead of \"not less than seven years\" as \"more than four years\". The learned Judges read the provisions in the manner as was amended by them and calculated the pension payable to the respondent at Rs.20,580 per annum for the period November 1, 1986. Consequential relief relating to the payment of the gratuity and family pension in the light of the relief granted relating to pension was also directed to be given. ", "885 ", "We are at a loss to understand the reasoning of the learned Judges in reading down the provisions in paragraph 2 in force prior to November 1, 1986 as \"more than five years\" and as \"more than four years\" in the same paragraph for the period subsequent to November 1, 1986. It is not the duty of the either to enlarge the scope of the legislation or the intention of the legislature when the language of the provision is plain and unambiguous. The cannot re- write, recast or reframe the legislation for the very good reason that it has no power to legislate. The power to legislate has not been conferred on the courts. The cannot add words to a statute or read words into it which are not there. Assuming there is a defect or an omission in the words used by the legislature the could not go to its aid to correct or make up the deficiency. s shall decide what the law is and not what it should be. The of course adopts a construction which will carry out the obvious intention of the legislature but could not legislate itself. But to invoke judicial activism to set at naught legislative judgment is subversive of the constitutional harmony and comity of instrumentalities. , 1990 1 SCR 482 at 488; , 5 SCR 239; , Supp. 1 SCR 489; , SCR 1122 at 113 1; ., SCR 533 at 545; , 2 SCR 146; S. Narayanaswa- mi v. G. Pannerselvam & Ors., 1 SCR 172 at 182; ., 1 SCR 886; ., 1 SCR 423 and , 2 SCR 430 at 438. Modifying and altering the scheme and applying it to others who are not otherwise entitled to under the scheme, will not also come under the principle of affirmative action adopted by courts some times in order to avoid discrimination. If we may say so, what the High has done in this case is a clear and naked usurpation of legislative power. The view of the High that paragraph 2 discrimi- nates between those who have completed seven years of serv- ice and those who have not completed that much service is in our opinion not correct. It is a well-known practice in pensionary schemes to fix a minimum period for purposes of pension. What shall be the minimum period for such pension will depend on the particular service, the age at which a person could enter into such service, the normal period which he is expected to serve before his retirement on superannuation, and vari- ", "886 ", "ous other factors. There is nothing in evidence to suggest that the period of seven completed years of service fixed for pension is arbitrary. So far as the Judges of the High Court is concerned as we have noticed earlier even under the Government of India Act a period of seven completed years of service before superannuation was prescribed for eligibility for pension. In fact no pension was provided for those who had not completed seven years of service under preconstitu- tion scheme. Thus we have history or historical grounds or reasons for fixing not less than seven years of service for pension. Part I deals with a pensionary scheme. Prescribing a minimum period of service before retirement on superannua- tion, for pension is the very scheme itself and not a clas- sification. It is so to say a qualification for eligibility. It is different from computation of pension. All those who satisfy that condition are eligible to get pension. ", "Even those who had completed seven years of service were not given pension for all the completed years of serv- ice at the rate Rs. 1,600 per annum and a maximum limit has been fixed for purposes of pension. If we calculate the maximum amount provided with reference to the rate per year roughly in about 14 years of service one would have reached the maximum amount. Any service above that period is not taken into account. Thus a person who had put in the minimum period for getting the maximum pension could be said to be favourably treated against the person who had put in more number of years of service than needed for the maximum pension and thereby discriminated. Thus the reasonableness of the provision in the pensionary scheme cannot be consid- ered in this line of reasonings. It is not impossible to visualise a case where the pension payable would be more than the last drawn pay if the maximum limit had not been fixed. ", "It is also not correct to state that the amount of pension provided in paragraph 9 is minimum pension. The said paragraph does not use the word 'minimum' but only state that if a Judge retires without being eligible for pension under any of the provisions, notwithstanding anything con- tained in the other provisions, the pension of a particular amount mentioned therein shall be paid to the Judge.. This amount is not calculated or has any reference to any period of service. For instance a Judge who had put in only two years of service before retirement will also receive the same amount as that of a Judge who have completed six years of service. Again if we run down the provision and strike as unconstitutional the condition relating to completion of seven years of service in paragraph 2 all those who had put in less than six completed years of service would be seri- ously affected and paragraph 9 also would become inapplicable. Further if we amend paragraph 2 of Part I of the First Schedule of the Act as done by it may be open to those who have' put in more than five years or more than four years as the case may be to, contend that they are discriminated against because persons who had put in less than that period will get pension at much higher rate. ", "We have, therefore, no doubt that had exceeded its jurisdiction and power in amending and altering the provisions of paragraph 2 by substituting different minimum period for eligibility of pension in paragraph 2 of Part I. Since the respondent has not put in seven completed years of service for pension he will be eligible for pension at the rates provided in paragraph 9 of Part I of the First Schedule to the Act, that is to say for the period from 4.10.1983 to 31.10.1986 at the rate of Rs.8,400 per annum and for the period on and from November 1, 1986 at the rate of Rs. 15,750 per annum. ", "We have already noticed that during the pendency of the appeal in this Court in the proceedings dated December 15, 1988 the Government of India communicated to the Chief Secretary, Government of Lucknow, in compliance with the mandamus issued by , that the President of India was pleased to sanction the addition of one month and 13 days to the service of the respondent to make it six years of completed service subject to the final decision in this appeal. In the circumstances however and in the view we have expressed earlier on the question of pension, we do not want to go into the question whether was right in setting aside the earlier rejection for addition of the period. Since the addition of one month and 13 days does not make any difference in calculation of pension as we have already stated, this Presidential sanction has become rele- vant only for the purpose of calculating the gratuity under section 17A(3) of the Act. As the period is less than three months and as the President was pleased to sanction the addition in exercise of his power under Section 16 of the Act though subject to the final decision of this Court we would consider it just and necessary to allow this addition remain in force for the purposes of calculation of gratuity, and family pension only though not for pension. The appeal is accordingly allowed and the order of is set aside. The respondent will however be entitled to fixation of family pension and for payment of gratuity calculated on the basis of his having completed six years of service. There will be no orders as to costs. ", " al- lowed."], "relevant_candidates": ["0000553711", "0000609478", "0000701162", "0000919121", "0001028604", "0001180097", "0001302865", "0001368176", "0001416283", "0001544426", "0001567210", "0001801693"]} {"id": "0000098072", "text": ["PETITIONER: STATE OF BIHAR AND OTHERS ETC. Vs. RESPONDENT: AKHOURI SACHINDRA NATH AND OTHERS ETC. DATE OF JUDGMENT19/04/1991 BENCH: RAY, B.C. (J) BENCH: RAY, B.C. (J) SAHAI, R.M. (J) CITATION: 1991 AIR 1244 1991 SCR (2) 410 1991 SCC (1) 334 JT 1991 (2) 279 1991 SCALE (1)748 ACT: Law: Bihar Public Works Departments Code: Rule 2-Bihar Engineering , Class II-Assistant Engineers- 25 of posts to be filled up by promotion and 75% by direct recruitment-Seniority promotees and direct recruits-Whether seniority can be conferred on promotees retrospectively from a date they were not born in the Cadre. HEADNOTE: Under Rule 2 of the Bihar Public Works Department Code, the Governor of Bihar took a decision on 7.4.1958 providing that 25% of the posts of Assistant Engineers in (the ) were to be filled by promotion, subject to availability of suitable hands, from Overseers in () and 75% of the posts were to be filled by direct recruitment to the . Respondents no. 1 to 5 in both these appeals were appointed as Assistant Engineers in the on the recommendation of in the year 1961; and the appellants (in Civil Appeal No. 233 of 1978(respondents no. 6 to 23 in Civil Appeal No. 232 of 1978), who had been working as Overseers in () were promoted to the posts of Assistant Engineers in the in 1962 and thereafter. However, by orders dated 12.7.1975, 20.1.1976 and 9.4.1977, the changed the date of promotion of the appellants to the dates prior to the appointment of respondents no. 1 to 5 in the , making the former Senior to the letter. Respondents no. 1 to 5 filed writ petition before challenging the seniority conferred on the appellants from the retrospective date and contended that the orders giving promotions to the appellants from a date earlier to date of their promotion in the purported to affect prejudicially respondents no. 1 to 5's right inasmuch as they were appointed to the earlier to the promotion of the appellants; and that the seniority had to be reckoned amongst the officials working as Assistant Engineers in the from the date of their appointment or promotion to the said . The appellants contended that they were entitled to be promoted retrospectively on the 411 basis of reservation of 25% of the Cadre posts in the till 1958. . holding that the orders promoting the appellants with retrospective effect were bad, quashed the same and allowed the writ petition. Hence the present appeals. On consideration of the legality and validity of the orders of the giving promotions to the appellants from a date earlier to the date of their entry into the as Assistant Engineers, and its effect on the inter- se seniority amongst the appellants and respondents no. 1 to 5, who were directly appointed as Assistant Enginers in the before the appellants entered in the said . Dismissing the appeals, this , HELD: 1. The Orders dated 12.7.1975, 20.1.1976 and 9.4.1977 which purported to give promotion to the appellants retrospectively were arbitrary, illegal and inoperative inasmuch as these seriously affected rspondents no. 1 to 5. The appellants were not borne in the cadre of Assistant Engineers even in officiating capacity at time when rspondents no. 1 to 5 were directly recruited to the post of Assistant Egineer. As such, the promotee appellants could not be under any circumstance given seniority over the directly recruited respondents no. 1 to 5. The judgment of in quashing the impugned Orders was, therefore, unexceptionable. [418F-H; 420A] 2.1 No person can be promoted with retrospective effect from a date when he was not borne in the Cadre so as to adversely affect others; and amongst members of the same grade, seniority is reckoned from the date of their initial entry into the service. [419F] 2.2 Seniority inter-se amongst the Assistant Engineers in Bihar Engineering , Class II would be considered from the date of the length of service rendered as Assistant Engineers. Therefore, the appellants could not be made senior to respondents no. 1 to 5 by the impugned Orders as they entered into the said in 1962 and thereafter by promotion subsequent to respondent no. 1 to 5 who were directly recruited in the quota meant for them. There was nothing to show that the appellants could be deemed to be recruited in 1958 quota and that these vacancies were carried forward. [419G; 418E- ., 1 SCC 319, relied on. 412 ., 1 SCR 815 and , Supp. SCC 207, held inapplicable. ., Supp. SCC 243, referred to. JUDGMENT: ", "CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 232-233 of 1978. ", "From the Judgment and Order dated 19.7.1977 of in C.W.J.C. No. 756 of 1977. ", ", , , Ms. , Ms. , Mrs. , , , , , , Mrs. and for the appearing parties. ", "The Judgment of the Court was delievered by , J. These two appeals were filed against the common judgment and order dated 29th July, 1978 made by of at Patna in C.W.J.C. No. 756 of 1977 whereby quashed the orders of the government contained in Annexures 8, 9 and 10 to the writ petition. The facts unfurled from the writ petition are as follows: ", "The respondent Nos. 1 to 5 in these appeals (the petitioners in the writ petition) were directly appointed in as Assistant Engineers of on the recommendation of and were posted in in 1961. The respondent Nos. 6 to 23 in C.A. No. 232 of 1978 (who are appellants in C.A. No. 233 of 1978 and respondent Nos. 5 to 22 in the writ petition) were working at that time as overseers in (). On 7th April, 1958 the the Governor took a decision under rule 2 of the Public Works Code that 25% of the posts in , Class II shall be filled up by promotion, subject to availability of suitable hands. Thus, out of the total vacancies in , Class II, 75% of the vacant posts as determined by the will be filled up by direct recruitment and 25% of the vacant posts will be filled up by promotion subject to availability of suitable candidates. By notification dated 18th July, 1964/27th August, 1964, respondent Nos. 6 to 13 in C.A. No. 232 of 1978 (appellant Nos. 1 to 8 in C.A. No. 233 of 1978 and respondent Nos. 5 to 12 in the writ petition) who were members of (Overseers) were promoted to the post of Assistant Engineer in Class II and by another notification dated 21st July, 1969, respondent Nos. 14 to 23 in C.A. No. 232 of 1978 (appellant Nos. 9 to 18 in C.A. No. 233 of 1978 and respondent Nos. 13 to 22 in the writ petition) were also promoted to , Class II as Assistant Engineers. On February 25, 1969, a seniority list of Assistant Engineers was published by the wherein the names of the respondent Nos. 1 to 5 (the petitioners) were mentioned at Sl. Nos. 170, 199, 208, 211 and 226 and the names of the respondent Nos. 6 to 23 (respondent Nos. 5 to 22 in writ petition) were mentioned at Sl. Nos. 253, 254, 256 to 262, 687 to 695 and 701 respectively The respondent Nos. 6 to 23 were thus shown as juniors to the respondent Nos. 1 to 5 (the petitioners). The respondent Nos. 6 to 23 feeling aggrieved by the said seniority list made representations claiming seniority over respondent Nos. 1 to ", "5. On 3rd May, 1972 the State of Bihar constituted a Committee known as by a resolution to consider the inter se seniority of Civil Engineers including the Assistant Engineers. On April 19, 1973 the submitted a report making certain recommendations. It was alleged that a revised seniority list was prepared wherein the respondent Nos. 1 to 5 were shown juniors to the respondent Nos. 6 to 23. This, of course, has been denied in affidavit-in-counter filed on behalf of the (appellants in C.A. No. 232 of 1978, respondent Nos. 6 to 9 in C.A. 233 OF 1978, and respondent Nos. 1 to 4 in the writ petition). On 21st of July, 1975, an order was made whereby the date of promotion of respondent Nos. 6 to 13 was changed from 21st July, 1962 to 27th February, 1961 thereby making the respondent Nos. 1 to 5 juniors to respondent Nos. 6 to ", "13. This order is contained in annexure 8 to the writ petition. In other words, the respondent Nos. 6 to 13 were promoted retrospectively from the State against it but the State government instead of redressing their grievances made another order on January 20, 1976 (annexure 9 to the writ petition) re-fixing the seniority of respondent Nos. 6 & 7 promoting them to with effect from December 19, 1958. Again, to the prejudice of the respondent Nos. 1 to 5, an order was passed by by which the date of promotion of respondent Nos. 14 to 23 was pushed back to February 27, 1961 making them also senior to the respondent Nos. 1 to 5. This order is contained in annexure 10 to the writ petition. ", "414 ", "The respondent Nos. 1 to 5, therefore, filed a writ petition in at Patna being Civil Writ Petition No. 756 of 1977 challenging the seniority conferred on the respondent Nos. 6 to 23 (respondent Nos. 5 to 22 in the writ petition) by annexures 8, 9 and 10 on the ground that these orders were wholly arbitrary illegal, void and inoperative and ineffective and so prayed for appropriate writ for quashing those orders. ", "A counter-affidavit was filed on behalf of the State . In Para 3(iii) of the said affidavit, it has been averred that till 1957, 25% of the vacancies in , Class II, were being filled up by promotion from (commonly known as `Overseers'). Subsequently, in the year 1958, it was decided that 25% of the cadre posts in the , Class II Both permanent and temporary, shall be reserved for being filled up through promotion from the members of . It has been further averred in para 3(iv) that all the posts of temporary Assistant Engineers to which the Overseers were entitled to be promoted on the basis of 25% reservation in the cadre were not filled up by promotion of Overseers, only 3 overseers were given promotion with effect from 19.12.1958 vide order No. A/P1- 409-64-1-14294 dated 18.7.64/27.8.64. In the said affidavit it has also been stated that on a careful examination of the matter it was found that on the basis of total number of posts of Assistant Engineers in the Department, the Overseers were entitled to 60 posts on the basis of 25% reservation till 1958, out of which they were already given 33 posts and 27 more posts of Assistant Engineers were still due to them and accordingly by an order dated 20th January, 1976 the 21 Overseers who had earlier been given promotion as temporary Assistant Engineers from later dates in 1960, 1961 and 1962 by the order dated 18.7.64/27.8.64. were given promotion, with effect from 19.12.1958. Due to this correction, respondent Nos. 6 and 7 and one Shri Mithileshwari Sahay (since retired) were promoted as temporary Assistant Engineers with effect from 19.12.1958 in partial modification of the order dated 18.7.64/27.8.64 and another order dated July 12, 1975. It has been further stated that as a result of this modification in the dates of promotion as Assistant Engineer who by the order dated 20th January, 1976 were allowed promotion as temporary Assistant Engineers with effect from 19.12.1958 as against promotions from later dated in 1960, 1961 and 1962 given to them by earlier Order dated 27.8.1964 and order dated 21.7.1969. It has also been stated that the respondent Nos. 6 and 7 were entitled to promotion in 1958 and respondent Nos. 8 to 23 to promotions in 1960 and 1961, on the basis of the reservation of 25% of the cadre post in , Class II, for promotion of Overseers from . It has been further averred that as against 21 consequential vacancies, the case of only 17 Overseers was modified accordingly in supersession of the earlier order dated 18.7.64/27.8.64 and respondent Nos. 8 to 13 were given promotion as temporary Assistant Engineer with effect from 27.2.1961, from which date the promotion was due to them on the basis of the quota by a Order No. 10501 (annexure 8 to the writ petition) dated July 12, 1975 and No. 17328 dated November 8, 1975 respectively. It has also been stated that the seniority list that was prepared and published in 1969 was tentative. ", ", Patna held that no person can be promoted with retrospective effect from a date when he was not born in the cadre so as to adversely effect others. The respondent Nos. 1 to 5 were recruited to the post of Assistant Engineer, Class II before the respondent Nos. 6 to 23 were promoted to the post of Assistant Engineer, Class II in , Class II. , therefore, held that the orders contained in Annexure (respondent Nos. 5 to 22 in the writ petition) with retrospective effect are bad and so quashed those orders referred to in the said annexures. ", "Against this judgment and order made by , the instant appeals on special leave were filed. ", "The sole question which falls for decision in these appeals is whether the inter-se seniority between the petitioners-respondent Nos. 1 to 5 who are direct recruits and the Overseers belonging to (Irrigation Department) who had been promoted retrospectively in their 25% quota for the year 1958 as revised by the orders mentioned in annexures 8, 9 and 10 to the writ petition, is arbitrary, illegal and inoperative as those orders purport to affect prejudicial the seniority of the petitioners-respondent Nos. 1 to 5 in the service of , Class II. It is not disputed that in 1958 under Rule 2 of the Public Works Department Code, the of Bihar took a decision to the effect that 25% of the posts in the , Class II shall be filled up by promotion, subject to availability of suitable hands. It also appears from the counter-affidavit filed on behalf of the that in 1958, the the total number of posts to be filled up by promotion from the Overseers in (Irrigation Department) to the post of Assistant Engineer, in , Class II was 60 out of which only 33 posts were filled up by promotion, leaving 27 more posts of Assistant Engineers to be filled up by promotion from the Overseers in (Irrigation Department). It is also clear from the averments made in the said counter-affidavit that the petitioners-respondent Nos. 1 to 5 were appointed in , Class II on the recommendation of in the year 1961 and the respondent Nos. 6 to 13 who had been working in (Irrigation Department) as Overseers and having independent charge of the sub-division were promoted to the post of Assistant Engineer, Class II by notification dated 18.7.64/27.8.64. The respondent Nos. 14 to 23 were also promoted by notification dated 21.7.1969. On the basis of these appointments and promotions in the post of Assistant Engineer in the , Class II, a seniority list was prepared and published in february, 1969 tentatively wherein the petitioners- respondent Nos. 1 to 5 were shown as senior to respondent Nos. 6 to 23. However, the by its order dated 21st July, 1962 changed the date of promotion of respondent Nos. 6 to 13 from 21.7.1962 to 27.21961 (Annexure 8 to the writ petition) thereby making the petitioners-respondent Nos. 1 to 5 junior to respondent Nos. 6 to 13. On January 20, 1976, the passed another order re-fixing the seniority of respondent Nos. 5 & 6 promoting them to , Class II with effect them 19.12.1958 (Annexure 9 to the writ petition). Again an order contained in Annexure 10 to the writ petition was passed by which the date of promotion of respondent Nos. 14 to 23 was pushed back to February 27, 1961, thus making them senior to the petitioners-respondent Nos. 1 to 5. The petitioners- respondent Nos. 1 to 5 challenged these three orders mainly on the ground that these orders giving promotion to the respondent Nos. 6 to 23 from a date earlier to their date of promotion to the post of Assistant Engineer in , Class II purport to affect prejudicially the rights of the petitioners-respondent Nos. 1 to 5 in as much as they were appointed to the post of Assistant Engineer in the , Class II earlier to the promotion to the said post of the respondent Nos. 6 to 23. It has also been submitted in this connection that he seniority has to be reckoned amongst the officials working as Assistant Engineers in the , Class II from the date of their appointment on promotion to the said Service. The petitioners-respondent Nos. 1 to 5 being appointed earlier directly in the quota of direct recruits than the promoted respondents who were promoted later cannot be given seniority in service to the petitioners-respondent Nos. 1 to 5 and it was contended that the impugned orders are wholly illegal and unwarranted and so has rightly quashed the said orders. It has been further urged in this connection that the can promote its employees with retrospective effect provided such retrospective promotion does not affect the right and seniority already earned by others. The petitioners-respondent Nos. 1 to 5 who were senior to the petitioners-respondents Nos. 6 to 23 were made junior to them by the said orders as contained in Annexure 8, 9 and 10 to the writ petition. It has, therefore, been contended that the promotion to the respondent Nos. 6 to 23 was illegal and arbitrary as the same had prejudicially affected the petitioners-respondent Nos. 1 to 5 in regard to their seniority. ", " while rendering its judgment relied on the decision in the case of ., 1 SCC 319 specially on the observation made therein as under: ", "\"Once the Assistant Engineers are regularly appointed to officiate as Executive Engineers within their quota they will be entitled to consideration in their own rights as Class I Officers to further promotions. Their \"birth marks\" in their earlier service will be of no relevance once they are regularly officiating in the grade of Executive Engineer within their quota.\" held that no person can be promoted with retrospective effect from a date when he was not born in the cadre so as to adversely affect others. ", "It is the admitted position that the respondent Nos. 6 to 23 were working as Overseers in and were promoted to the post of Assistant Engineer in , Class II much after the petitioners-respondents Nos. 1 to 5 were directly recruited and appointed on the basis of the recommendation of , to the post of Assistant Engineers in 1961 and as such they have been working in the grade of Assistant Engineers much before the respondent Nos. 6 to 23. Undoubtedly, on the basis of the order of the Governor in 1958, the posts of Assistant Engineers are to be filled up from two sources i.e. by direct recruitment as well as by promotion from Overseers working in and the ratio of the vacan- ", "418 ", "cies to be filled up has been fixed as 75% from the direct recruits and 25% from the promotees. It has been urged on behalf of the respondent Nos. 6 to 23 that in view of the quota rule the respondent Nos. 6 to 23 who were promoted in the quota set out for promotees in respect of the vacancies of 1958 shall be taken to be promoted in 1958 notwithstanding that they have been actually promoted long after 1958 and after the direct recruits i.e. respondent Nos. 1 to 5 were recruited directly to the post of Assistant Engineers. In other words even though the respondent Nos. 6 to 23 have been promoted after the date of recruitment of respondent Nos. 1 to 5 to the post of Assistant Engineer, still then the promote respondent Nos. 6 to 23 should be deemed to be senior to the direct recruit respondent Nos. 1 to 5 as they were promoted in the vacancies for 1958 quota set up for promotees. In support of this submission the decision in V.B. Badami etc. v. State of Mysore and Ors., [1976] 1 SCR 815 as well as v. State of Kanataka, [1987] Supp. SCC 207 were cited at the bar. In both these cases the promotees occupied the quota of direct recruits as direct recruits were not available to fill up the quota meant for them. It was held that direct recruits who were appointed within their quota subsequently were entitled to the vacancies within their quota which had not been filled up and they would become senior to the promotees The promotees would be pushed down to later years when their appointment could be regularised as a result of absorption in their lawful quota of those years. The promotees cannot claim any right to hold promotional posts unless the vacancies fall within their quota. These cases have no application in the instant case in as much as the direct recruits i.e. respondent Nos. 1 to 5 were recruited in their quota i.e. the quota meant for them. This being so, the decision in these two cases has no application to the instant case. Moreover, there is nothing to show that the respondent Nos. 6 to 23 who were promoted in 1962 and thereafter i.e. subsequent to the direct recruits i.e. respondent Nos. 1 to 5 could be deemed to be recruited in 1958 quota as there was nothing to show that these vacancies were carried forward. ", "The 's orders as contained in annexures 8, 9 and 10 which purport to give promotion to the respondent Nos. 6 to 23 retrospectively are arbitrary, illegal and inoperative in as much as these seriously affect the respondent Nos. 1 to 5. The respondent Nos. 6 to 23 were not in the cadre of Assistant Engineers even in officiating capacity at the time when the respondent Nos. 1 to 5 were directly recruited to the post of Assistant Engineer. As such, the said promotee respondent Nos. 6 to 23 could not be under any circumstances, given seniority over the directly recruited respondent Nos. 1 to 5. has rightly quoted the observation made by this Court in the case of (supra) as mentioned in the preceding paragraphs. ", "It is pertinent to mention in this connection, the observation of this Court in the case of ., Supp. SCC 243. In this case the petitioners were confirmed as Assistant Medical Officers in 1962 and 1963 and they were placed in the higher scale of Assistant Divisional Medical Officers to with effect from January 1, 1973. Thereafter they were appointed as officiating Divisional Medical Officers in 1972, 1973 and 1974 and they had been continuing there uninterrupted. Respondent Nos. 4 to 64 were given substantive appointments as Divisional Medical Officers later on but they were confirmed earlier than the petitioners because of the zone-wise confirmation given by . It was held that the petitioners should be considered at par for the purpose of fixing seniority, with those appointed to permanent posts in a substantive capacity. For the purpose of determining seniority among promotees, the petitioners should be treated as having been appointed to permanent vacancies from the respective dates of their original appointment and the \"entire period of officiating service performed by them should be taken into account as if that service was of the same character as that performed by the substantive holders of permanent posts.\" ", "In the instant case, the promotee respondent Nos. 6 to 23 were not born in the cadre of Assistant Engineer in , Class II at the time when the respondent Nos. 1 to 5 were directly recruited to the post of Assistant Engineer and as such they cannot be given seniority in the service of Assistant Engineers over the respondent Nos. 1 to 5. It is well settled that no person can be promoted with retrospective effect from a date when he was not born in the cadre so as to adversely affect others. It is well settled by several decisions of this Court that amongst members of the same grade seniority is reckoned from the date of their initial entry into the service. In other words, seniority inter-se amongst the Assistant Engineers in , Class II will be considered from the date of the length of service rendered as Assistant Engineers. This being the position in law the respondent Nos. 6 to 23 can not be made senior to the respondent Nos. 1 to 5 by the impugned orders as they entered into the said Service by promotion after the respondent Nos. 1 to 5 were directly recruited in the quota of direct recruits. The judgment of quashing the impugned orders made in annexures, 8, 9 and 10 is unexceptionable. ", "In the premises aforesaid, we confirm the judgment and order rendered by . The appeals are, therefore, dismissed. In the facts and circumstances of the case, there will be no order as to costs. ", "R.P. Appeals dismissed."], "relevant_candidates": ["0000037607", "0000153655", "0000912111", "0001261200"]} {"id": "0000105440", "text": ["JUDGMENT , J. ", "1. This is an appeal from the judgment of Mr. Justice . On June 26, 1942, the defendants sold to the plaintiffs 33 bales of piecegoods or 36 bales, three bales more according to the option of the defendants. In all delivery was given of 22 bales between July 3, and August 21, 1942. The defendants, according to the plaintiffs, failed to give delivery of the remaining 11 bales, and the plaintiffs have fled this suit for damages for non-delivery of the 11 bales. Mr. Justice who tried the suit held that the defendants had committed a breach of the contract and that they had failed to give delivery of the 11 bales; and he referred the suit to the Commissioner to assess the damages on the basis that the breach had taken place on November 12, 1942, and that damages should be assessed at the difference between the market rate prevailing on that date and the contract rate. The plaintiffs' case was that they had made various demands for delivery. They proved two oral demands in October, 1942, and they also proved that a tender was made for the remaining eleven bales on November 12, 1942, which tender was refused by the defendants. On this evidence the learned Judge came to the conclusion that the contract had been broken on November 12, 1942. ", "2. In this appeal the first question that arises is whether there was any breach of the contract on the part of the defendants. Under Section 35 of the Indian Sale of Goods Act, 1930, it is obligatory upon the buyer to apply for delivery and the seller is not bound to deliver the goods unless there is an application for delivery on the part of the buyer. Mr. has contended that in this case there was no application for delivery by the buyer within reasonable time and, therefore, there was no breach on the part of the seller as the seller was not bound to deliver the remaining 11 bales. ", "3. The terms of the contract have been reduced to writing; and we may point out, with respect to the learned Judge below, that he has fallen into error in admitting parole evidence with regard to negotiations antecedent to the contract and also with regard to the subsequent conduct of the parties. Once the parties reduce the terms of their contract into writing, the can only look at the writing alone in order to construe what the terms of the contract were. It is hardly necessary to say that what the terms of the contract between the parties were cannot be ascertained by allowing parole evidence as to what transpired antecedent to the contract or what the parties did -subsequent to the contract. Now on the construction of the contract two points have been placed before us; and as far as we can see, whatever view we may take as to the construction does not materially affect the question that we have got to decide. The contract sets out various particulars in different columns. It first mentions the number of bales and then the quality of the bales; and then under the heading \"Delivery\" it mentions various places, Indore, Ujjaa and Bombay; and then the prices of various bales are mentioned. At the foot of the contract appears: ", "Mill Delivery, Shipment Ready, Less 3/4% per cent discount and Re. 1 per bale, Railway Receipt through Bank. ", "Now Mr. has contended that on a true construction of, this contract the goods were to be delivered at the various places mentioned in the contract at the mills. Mr. argues that the column \"Delivery\" makes it clear that the place of delivery was the different places mentioned under that column and delivery is further localised by stating; that not only is it to be at the particular place but at the mill itself. On the other hand, Sir contends that when you look at all the particulars of the contract carefully, it is clear that the place of delivery of the goods was at Calcutta. Sir particularly emphasizes the expression \"Shipment Ready\" in the contract. It is common ground that the goods that were sold were not forward goods but ready goods. But the expression \"Shipment\" has to be carefully noticed because, if the buyer had to take delivery at the various places mentioned in the contract, there was no need to state in the contract the expression \"Shipment\". \"Shipment\" is not used in its proper etymological sense, but it can only mean in this case \"despatch\" or \"rail\" and the contract undoubtedly casts an obligation upon the seller to despatch or rail the goods. Further it is to be noted that payment is to be made by the buyer through a bank when he obtains the railway receipt. If the obligation was upon the buyer's take delivery at the various places mentioned in the contract, it is difficult to understand how lie could pay for these goods against railway receipts through a bank in Calcutta. The various places mentioned under the column \"Delivery\", coupled with the phrase \"Mill Delivery\", seem to indicate that the prices fixed are ex-mill and that the buyer is liable to pay for extra charges incurred for despatching the goods from the various places to Calcutta. \"We do not agree with Mr. that the expression R/R through bank merely deals with the mode of payment. This provision has got to be taken into consideration with all the other provisions in the contract in order to arrive at a true conclusion as to whether under the contract goods were to be delivered at Calcutta or at the various places mentioned in the contract. We therefore agree with the learned Judge who took the view that under the contract the delivery of the goods had to be made at Calcutta. ", "4. Now on the question whether the buyer made an application for delivery not not, there is evidence on the record which has been accepted by the learned Judge. , the munim of the plaintiff, gave evidence and he stated that the contract was reduced to writing at Calcutta and duly signed and after the contract was signed, he told the representative of the defendants that he had bought ready goods and therefore early delivery should be given of these goods and the representative of the defendants agreed that a quick and early delivery would be given; and further on, in cross-examination., he repeated practically the same evidence by saying that he, demanded that as the contract was for ready goods they should be delivered immediately and the defendants' representative said that they would be so delivered as and when the railway waggons were made available. Mr. has made a grievance of the fact that in the plaint the fact that an application for delivery was made on June 26, 1942, has not been clearly set out. It is true that when a buyer sues a seller for damages for non-delivery, application for delivery on his part is a part of the cause of action and must be explicitly stated, but when we turn to paragraph 3 of the plaint, we do find an averment that the defendants had failed to give delivery of the remaining goods in spite of the repeated requests made in that behalf by the plaintiffs, in our opinion this averment, although perhaps not as specific as one might have desired, is sufficiently clear to cover the application for delivery relied upon by the plaintiff's at the trial on the date on which the contract was made, namely June 26, 1942. ", "5. We might point out that we do not agree with the contention of Sir that when goods which are to be delivered are ready goods, no application for delivery is necessary on the part of the buyer tinder Section 35 of the Indian Sale of Goods Act. Section 35 makes 110 distinction between the sale of ready goods and of forward goods; and in (1935) 37 Bom. L.R. 538, P.C. has laid down that the buyer can only be relieved from his statutory obligation to apply for delivery by an express stipulation to the contrary. ", "6. Assuming that there was an application for delivery on the part of the buyer on June 26, 1942, it is not disputed that the defendants failed to make delivery of the eleven bales and thereby committed a breach of the contract. What we have next to consider is: what is the date of the breach of the contract? and what is the due date on which the contract should have been performed ? Now under this contract, as I have pointed out, no time is fixed for delivery of the goods sold; and under Section 36 , Sub-clause (2), of the Indian Sale of Goods Act , where under the contract of sale the seller is bound to send the goods to the buyer, but no time for sending them is fixed, the seller is bound to send them within a reasonable time. Therefore the law implies a reasonable time within which the contract is to be performed when the contract itself is silent as to the time of performance. In our opinion once a reasonable time is implied within the meaning of Section 36 , Sub-clause (2)3 the contract becomes a contract to be performed at, a fixed time as much as if the parties themselves have fixed a specific time. In the one case it is the act of parties which determines the time when the contract is to be performed; in the other case it is by implication of law that the time is determined. ", "7. In this case Sir has relied on the fact that although the contract was arrived at on June 26, 1942, 22 bales were delivered between -July 3, and August 21, 1942. Nothing happened in September and, as I have pointed out, there were oral demands in October, 1942; and finally a tender for a sum of Rs. 7,300 to cover the delivery of the remaining bales was made on November 12, 1942. Sir has argued that the contract must be deemed to be alive till November 12, 1942, and the breach took place when there was a final refusal to perform the contract on November 12, 1942. Now in (1945) 47 Bom. L.R. 719, we very recently held that a party to the contract cannot extend the time for the performance of the contract by a unilateral act and that there must be an agreement to extend the time. Now in this case no agreement to extend the time is either pleaded or attempted to be proved. It is true that in. that particular case the time for delivery was fixed; but I see no reason in principle to distinguish between a contract where the time for delivery is fixed and a contract where the time for delivery is, not fixed. If the time for the performance of a contract or the time for delivery is fixed, it cannot be extended by the unilateral act of a party. ", "8. Equally so time cannot be extended in the case of a contract where the law implies a reasonable time for the performance of the contract. In the first case, when the fixed time has expired there would be a breach; in the latter case, when the reasonable time implied by the law has expired, equally so there would be a breach unless either in the one or in the other case there is an agreement between the parties to extend the time for the performance of the contract. Sir has contended that there is a distinction in law between a contract where the time for delivery is fixed and a contract where such a time is not fixed and, according to Sir , the latter contract does not come; to an end by efflux of reasonable time implied by the law, but there must be-a definite refusal on the part of one of the parties to perform the contract. It is only then that there is a breach of the contract. In this case, according to Sir , both the parties to the contract considered the contract to be alive till November 12, 1942, and it was only on November 12 that the seller definitely refused to perform the contract and therefore, according to-Sir , the breach took place on November 12, 1942. In support of this contention Sir has relied on two English cases. The first is v. and [1920] 1 K. B. 693. This is the judgment of Mr. Justice . Now, in the first place, it is to be noted that the observations of Mr. Justice , although deserving of the greatest respect, are on the facts of that case purely obiter. Mr. Justice was dealing with a ease of a contract where the time for delivery was fixed; but he did observe (p. 696): ", "If there is no fixed time the measure is the difference between the contract price and the market price at the time of refusal to deliver. ", "It is also to be noted that these observations of the learned Judge were based on the clear language of Section 51 , Sub-clause (3), of the English Sale-of Goods Act , 1898, which provided: ", "Where there is an available market for the goods in question the measure of damages is prima fade to be ascertained by the difference between the contract price and the market or current price of the goods at the time or times when they ought to have been delivered, or, if no time was fixed, then at the time of the refusal to deliver. ", "It is to be noted that our Sale of Goods Act has no section which corresponds, to Section 51 , Sub-clause (3), of the English Act . Even so, notwithstanding the clear language of Section 51 , Sub-clause (3), of the English Sale of Goods Act , 1893, in England in v. 2 K. B. 369 doubted the correctness of the opinion expressed by Mr. Justice in v. and 1 K. B. 693. Lord Justice actually went to the length of saying, contrary to the view expressed by Mr. Justice , (p. 378) : ", "It is difficult to see why it should be said that that the contract for delivery at times which can be determined by a jury is not a contract for delivery at fixed times. It seems to me that a meaning could be given to the words, 'if no time was fixed,' by reading them as referring to a contract such as to deliver goods on demand or to deliver goods as required by the purchaser. It might well be argued that that would give a meaning to the words in question. ", "Therefore the view that Lord Justice took was that under the English section when a reasonable time is implied by the law, the contract becomes a contract where the time for delivery is fixed. Sir in his wellknown text-book on the Sale of Goods Act has expressed the opinion, after setting out the provisions of Sections 50 and 51 of the English Sale of Goods Act, that Section 73 of the Indian Contract Act and the illustrations thereto, though the language is slightly different, are declaratory of the common law and in substance the same as Sections 50 and 51 of the English Sale of Goods Act. Now with great respect to the learned author, when we turn to Section 73 of the Indian Contract Act, there is nothing in the language of the section corresponding to Section 50 (3) or Section 51(3) of the English Sale of Goods Act, and even the illustrations to that section, which, as is well known, cannot possibly control the language of the section itself but merely afford a guide to the construction, do not in our opinion carry the matter any further. Illustrations (e) and (d) to Section 73 of the Indian Contract Act, which are relied upon, really do not deal with the question of reasonable time at all. Illustration (e) is a case of anticipatory breach and it is not clear from the illustration whether the breach took place within the reasonable time or not. Illustration (d) also does not indicate whether the promise was broken within the reasonable time or not. Even assuming that a refusal on the part of the seller to perform was necessary in a contract like this, which was a contract to be performed within a reasonable time, it is clear on the evidence that after the application for delivery was made on June 26, 1942, admittedly there was a failure to give delivery to the extent of 11 bales and, therefore, there was a failure to perform the contract which must be taken to mean the same thing as refusal to perform the contract. I fail to see why any more explicit refusal is necessary than a refusal to comply with the application for delivery made on the part of the buyer. But in our opinion there is no difference in law between a contract where the time is fixed by the act of the parties and a contract where no time is fixed and by implication of the law the contract is to be performed within a reasonable time. (If that be so, after the plaintiffs had made the application for delivery on June 26, 1942, the breach of the contract took place within a reasonable time of June 26. Now what is a reasonable time is a question of fact and in England it would be determined by the jury. Unfortunately the learned Judge did not apply his mind to this aspect of the case and, therefore, we have received no help or guidance from his judgment on this point. But fortunately there is sufficient evidence on record from which we can come to the conclusion as to what a reasonable time for the performance of this contract should be. \"Reasonable time\" must in each case depend upon the particular circumstances, the nature of the commodity, the question of transport, the times during which the contract was entered into and so on. It is in evidence that the first consignment of 2 bales was despatched on July 1, 1942, and reached Calcutta on July 8, 1942, which is within twelve days of the entering into the contract. There is no suggestion that if the seller was so minded, all the bales could not have been despatched at the same. time. The evidence shows that both the parties relied on the fact that the sale was of ready goods and they should be despatched as early as possible. Taking all the evidence into consideration, we are of the opinion that reasonable time in this case would be a fortnight after June 26, 1942. ", "9. We might point out that in a Bombay case, which was also a case for the sale of piecegoods, Mr. Justice considered one week as a reasonable time for delivery of the goods. That case is (1921) 24 Bom. L.R. 140. The case is also instructive from another point of view. In that ease the contract was for delivery of seventy-five sales for ready and twenty-five bales for September delivery. Forty-eight bales were delivered between September 17, 1920, and October 21, 1920; and although the delivery of these forty-eight bales extended right up to October 21, 1920, still Mr. Justice held that the date of breach was eight days after September 13, 1920, with regard to the contract for the sale of ready goods. The learned Judge said that the forty-eight bales which were delivered must be appropriated to the ready contract; and with regard to the balance, he awarded damages on the basis that the breach had taken place within a week of September 13, 1920. In this case also although the delivery of 22 bales had taken place from July 3, 1942, to August 21, 1942, these deliveries to 'the extent that they are after a fortnight from the date of the contract, namely, June 26, 1942, cannot be referable to this contract. As pointed out by Mr. Justice in a case reported in the same volume- deliveries are referable to a separate transaction and not to the contract in suit. ", "10. Therefore we hold that there was a breach on the part of the defendants, that the due date of the performance of the contract was July- 10, 1942 and that the damages must be assessed on the basis of the date of breach being July 10, 1942. ", "11. We will, therefore, vary the decree of the learned Judge below by substituting the date July 10, 1942, for November 12, 1942, as the date on which the breach took place. The learned Judge's order with regard to the reference to the Commissioner will stand. ", "12. The learned Judge has awarded to the plaintiffs the costs of the suit, Mr. contends that if the date of the breach was July 10, 1942, then no damages would be found in favour of the plaintiffs. If he is right, then inasmuch as no decree would be passed in favour of the plaintiffs, the plaintiffs would not be entitled to the costs of the suit. Therefore, in our opinion, the proper order with regard to the costs of the suit would be that the costs of the suit and further directions should be reserved till the Commissioner has made his report. ", "13. The appellants came to this contending, in the first place, that there was no breach and, secondly, that the learned Judge was wrong in fixing November 12, 1942 as the date of the breach. They have failed on the first and succeeded on the second. ", "14. Under the circumstances we think the proper order to make with regard to the costs of this appeal is that each party should bear their own costs."], "relevant_candidates": ["0000468409", "0000981438", "0001781912", "0001783426"]} {"id": "0000125801", "text": ["JUDGMENT , J. ", "1. This is a phenomenal case. Appeal is against a judgment in O.P. (MV) No. 305 of 1986 under Section 110-A of the Motor Vehicles Act, hereinafter referred to as 'the Act'. It is phenomenal, since the victim in the case is the owner of the vehicle itself. Not only this fact makes the case phenomenal but the legal representatives of the deceased got an award of compensation on the basis that the owner of the vehicle, under strange circumstances, met with a motor accident with his own vehicle, which has taken his life. Now, we shall briefly state the facts of the case. ", "2. Respondent Nos. 1 to 3 in the appeal are the applicants in the application for compensation before , Kottayam. The unfortunate event happened on 10.12.1985 at about 11 a.m. Respondent Nos. 1 to 3 herein are the claimants, the widow and minor children of the deceased. 4th respondent is the person who drove the vehicle, which caused the accident. 5th respondent is the insurance company. Appellant herein is a company engaged in the repairing and servicing of motor vehicles. The vehicle in question is a stage carriage KRO 7200. The bus belonged to the deceased. It was taken by him on hire-purchase from The vehicle was brought to the garage of the appellant for servicing. ", "3. The process of servicing was carried on by the workers engaged by the appellant. The husband of the first respondent herein was in the garage. He was talking with some persons. 4th respondent herein was on the driver's seat of KRO 7200. He started the engine and suddenly the bus moved backwards and it hit the compound wall on the western side of the garage. The husband of the first respondent who was leaning to the side of another bus was struck by the left side of the bus KRO 7200 and in fact, he was sandwiched between the bus and the western wall. 4th respondent, , escaped running away from the scene. ", "4. The employees of the garage and others, after pushing back the bus, extricated the injured person (husband of the first respondent) and he was taken to , Kottayam. The injury sustained by him was serious. Since it was an internal injury of the lungs, he was subjected to an operation, but, he succumbed to the injury on 11.12.1985. The husband of the first respondent was aged only 38 years. According to respondent Nos. 1 to 3, the deceased was earning about Rs. 10,000/- per month by operating the bus service from Kottayam to Payyappadi. The widow and children claimed a total compensation of Rs. 4,00,000/- under different heads. ", "5. Several contentions were taken by the appellant including the contention that the has no jurisdiction to try the case. The quantum was also disputed. Their liability to pay the amount was also seriously contested. Further, it was contended that in case the appellant is found liable to pay any compensation, the should direct the insurance company to pay the amount. ", "6. The very elaborately considered all the points raised before it. It held that the has got the jurisdiction to try the case. It found that the appellant is liable to pay the compensation. It fixed the total compensation at Rs. 1,61,760/- with future interest at 12 per cent per annum. It also held that the insurance company is not liable to pay the compensation amount. Naturally, the appellant is aggrieved by the award of the . It appeals. ", "7. Respondent Nos. 1 to 3 have challenged the quantum of compensation and filed a cross-objection. ", "8. The court is called upon to consider the following points: ", "(i) Whether on the facts and circumstances disclosed from the evidence, the has got jurisdiction to try the case? ", "(ii) Whether the is right in holding that the appellant is liable to pay the compensation? ", "(iii) Whether the quantum of compensation fixed by the is justifiable or adequate? ", "(iv) Whether the Tribunal erred in declining to direct the insurance company to pay the compensation found to be payable to respondents? ", "9. Before considering the first question, viz., whether the has got jurisdiction on the basis of the power source of the under the statute, viz., Section 110 of the Act, we feel that we must be fully informed about the legal status of the appellant in relation to the vehicle of the deceased. ", "10. Admittedly, the vehicle was in the custody of the appellant and that custody was that of a . Section 148 of the Indian Contract Act, defines bailment. Bailment is the delivery of goods by one person to another for some purpose, upon a contract that they shall when the purpose is accomplished be returned or otherwise disposed of according to the directions of the person delivering them. The person delivering the goods is called the bailor. The person to whom they are delivered is called the . The obligation and responsibility of a are delineated in Section 151 of the Indian Contract Act and it postulates that in all cases of bailment, the is bound to take as much care of the goods bailed to him as a man of ordinary prudence would, under similar circumstances, take of his own goods of same bulk, quality and value as the goods bailed. For all intents and purposes as long as the contract of bailment continues, there is nothing wrong in deeming the as the owner of the goods bailed. We will consider the effect of a motor accident caused by the employee of the in greater detail later, after considering the question whether the legal representatives of the deceased are entitled to maintain an action against the appellant herein for compensation under the Act. ", "11. It was contended that considering the facts revealed in the case, the has no jurisdiction to entertain an application under Section 110-A of the Act. In this context, we have to understand the scope and width of Section 110-A . Section 110-A provides for filing an application for compensation arising out of an accident of the nature specified in Sub-section (1) of Section 110 . Section 110-A further denominates the persons who can make the application under Section 110-A Clause (b) of Section 110-A provides \"where death has resulted from the accident, by all or any of the legal representatives of the deceased\". Of course, Section 110-A also makes provision regarding the form of the application, the contents of the application and the time within which the application has to be filed. The fundamental requirement to attract Section 110-A is that the compensation should be claimed on account of 'an accident' of the nature specified in Sub-section (1) of Section 110 . The can entertain an application only if it relates to an accident of the nature specified in Sub-section (1) of Section 110 . So, naturally, we have to consider the nature, scope and content of Sub-section (1) of Section 110 . In fact, the power source of the Claims is Section 110 . We shall quote Section 110 (1) in extenso. ", "110. Claims Tribunals.-(1) A State Government may, by notification in the Official Gazette, constitute one or more Motor Accidents Claims Tribunals (hereinafter referred to as Claims Tribunals) for such area as may be specified in the notification for the purpose of adjudicating upon claims for compensation in respect of accidents involving the death of, or bodily injury to, persons arising out of the use of motor vehicles, or damages to any property of a third party so arising, or both: ", "Provided that where such claim includes a claim for compensation in respect of damage to property exceeding rupees two thousand, the claimant may, at his option, refer the claim to a civil court for adjudication and where a reference is so made, shall have no jurisdiction to entertain any question relating to such claim. ", "Explanation.-For the removal of doubts, it is hereby declared that the expression 'claims for compensation in respect of accidents involving the death of, or bodily injury to, persons arising out of the use of motor vehicles' includes claims for compensation under Section 92-A ", "12. As far as the chief question that has to be decided in the case for the purpose of determining whether the application is maintainable before the we feel that the key words to be considered in Section 110 (1) of the Act are \"claims for compensation in respect of accidents involving the death of, or bodily injury to, persons arising out of the use of motor vehicles\" (emphasis added). The is given the power to adjudicate claims for compensation arising out of the use of motor vehicles. The legislature, through Section 110 (1) of the Act, has conferred that power on the s and the s' power is restricted only to claims arising out of the use of motor vehicles. No other restrictions are imposed by the legislature particularly, for the purpose of the case, we may say no restriction as to the class of victims of the accident. \"The Claims is a constituted by for expeditious disposal of the motor accident claims. The general law applicable is only common law and the law of Torts. If under the law a person becomes legally liable then the person suffering the injuries is entitled to be compensated and the is authorised to determine the amount of compensation which appears to be just.... Section 110 (1) of the Act empowers to constitute one or more Motor Accidents Claims s for such area as may be specified for the purpose of adjudicating upon claims for compensation in respect of accidents involving the death of or bodily injury to persons. The power is optional and may not constitute a Claims for certain areas.\" 1977 ACJ 118 (SC). ", "13. The Act does not create a new right or even a new remedy but has simply changed the forum and the process for adjudicating claims for compensation arising from accidents by the use of motor vehicles. Sections 110-A to 110-F of the Act merely deal with the change of forum and the process by substituting the civil court and its process. On a reading of Sections 110 to 110-F of the Act, it is plain and clear that Motor Accidents Claims Tribunals when constituted would substitute the civil courts in the matter of adjudicating the question of compensation arising out of accidents due to use of motor vehicles. As we said earlier, Section 110 (1) of the Act postulates accidents \"arising out of the use of motor vehicles\". Though the fundamental principle on which the liability is fastened can be traced to the law of Torts, many of the crucial aspects of that liability have been now made statutory by the Act. Even then the principles of law of Torts are relevant in the quantification of damages. We feel the word 'use' in Section 110 (1) of the Act has been used in a wider sense. It covers all engagements of the motor vehicle, including driving, parking, keeping stationary, repairing, leaving unattended on the road or for any other purposes. In the case when a vehicle is being driven and is stopped or parked for being repaired, it cannot be said that the vehicle is not being used. [See General Manager, Karnataka State Road Trans. 1979 ACJ 452 (Karnataka) and v. 1980 ACJ 248 (MP)]. ", "14. If the vehicle is parked on a dangerous slope and the accident is caused, we feel that Section 110 of the Act would be attracted. When by the opening of the door of a motor vehicle parked on a public road an accident arises, giving rise to a claim for compensation, it could not be said that the accident did not arise out of the use of the motor vehicle concerned. We feel that the words \"use of motor vehicles\" in Section 110 (1) of the Act are wide enough to comprehend such cases also. ", "15. Counsel for the appellant submitted that a reading of Section 110-B of the Act would suggest that the has no jurisdiction to entertain an application for adjudication of compensation to be paid to the injured or to the legal representatives in a case of death of a person against persons other than the driver, owner or the insurer. It is contended that Section 110-B of the Act makes the jurisdiction of the to be confined only against driver, owner or the insurer. A careful reading of Section 110-B of the Act would not permit such an interpretation. Section 110-B only mandates the that an apportionment of the liability of the insurer, owner and driver of the vehicle involved in the accident has to be made. ", "16. In v. 1988 ACJ 597 (Kerala), a Division Bench of this court had occasion to consider this question relying on the decisions in 1983 ACJ 13 ( 1986 ACJ 334 (Allahabad), [Sic. 1986 ACJ 344 (P&H)] and distinguishing the decisions in v. 1982 ACJ 374 ( 1986 ACJ 371 (Allahabad). , J., has held that the adjudication of all claims for compensation in respect of the accident arising out of the use of motor vehicle is to be done by the and that even though under Section 110-B the driver, owner and the insurer are mentioned, it does not curtail the power of the to direct payment of compensation to the injured or the legal heirs of the deceased by any person who caused the accident involving the use of the motor vehicle which resulted in death of or injuries to persons claiming compensation. ", "17. The same view is expressed in 1990 ACJ 1 (Allahabad), wherein the court held that \" is not confined in its jurisdiction to claims for compensation which are directed only against the driver, owner and insurer of the vehicle. Where the claim is founded on the assertion that the accident was caused by, apart from the use of the motor vehicle, some third party, the shall undoubtedly have jurisdiction to entertain the claim even though it is directed against a third party\". The crucial aspect to be looked into in deciding the question of jurisdiction, we feel, is that the claim must be in respect of accidents involving the death of or bodily injury to persons caused or contributed by the use of motor vehicle whether wholly or conjointly with some third party. Section 110-B of the Act, we feel, will not militate the view we have expressed above. We may also refer to Section 110-F of the Act, which clearly states that no civil court shall have jurisdiction to entertain any question relating to any claim for compensation which may be adjudicated upon by . ", "18. 1986 ACJ 344 (P&H), a Full Bench of had occasion to consider the question of the width of the jurisdiction under Section 110 of the Act. The case considered by was a claim petition filed for compensation for personal injuries and damages caused to the applicant's car dismissed by the on a preliminary objection that it has no jurisdiction to entertain the same. The accident occurred when the claimant was crossing a railway gate. A train struck against the car and it is alleged that the engine was without light. The railway crossing gate was lying open and there was no red light to stop traffic. It was pleaded that the accident occurred due to the negligence and carelessness of the railway authorities including the driver of the train and gateman. The appeal against the dismissal of the application was confirmed by the majority judgment. , J., speaking for , came to the conclusion that the claim was against the railway authorities alone alleging that the accident took place entirely due to their carelessness and negligence and that of the driver of the train and the gateman. There being no allegation that the motor vehicle in any way contributed to the cause of the accident, it cannot be said that the same had arisen out of the use of the motor vehicle. It is difficult for us to agree with this reasoning. If the motor vehicle was not used or was not driven, there was no possibility of an accident at all. So the accident has arisen out of the use of the motor vehicle. ", "19. In a case where the accident occurs solely on account of the negligence of a bullock-cart driver or handcart driver, it will be none the less an accident arising out of the use of the motor vehicle. In fact Section 110 of the Act does not refer to the question of whose negligence caused the accident. The emphasis is given only to the use of the motor vehicle for the purpose of attracting the jurisdiction of . The minority judgment by , J., has considered all the aspects of the matter. The learned Judge observed [quoting from 1983 ACJ 13 (Allahabad) para 12]: ", "The words 'in respect of accidents... arising out of the use of motor vehicles occurring in Section 110 (1) are words of the widest possible amplitude. We see no reason either on the plain language of Section 110 or in any other allied provisions or the scheme of the Act as manifested by the relevant provisions, which may have inhibited or barred the jurisdiction of to entertain an application for compensation in respect of third parties, in the present case, the railway. ", "20. Really speaking, the jurisdiction for a complete adjudication of all the claims for compensation in respect of accident occasioned on the use of the motor vehicle was called out from the general jurisdiction of the different and varied tortious actions which would enable parties to seek relief for compensation in ordinary courts in regard to accidents arising out of the use of motor vehicles and entrusted under Section 110 of the Act with . A complete adjudication of all the claims for compensation in such circumstances is absolutely necessary. Then alone, the statute will be effective and so, unless all the parties involved in the accident are arrayed as opposite parties before the same forum and heard on the question of negligence, the matter cannot be properly and effectively disposed of. Otherwise, even in respect of accidents arising out of the use of motor vehicles, it will be only a truncated jurisdiction before . We feel that this cannot be the intention of the legislature. We respectfully disagree with the majority decision in 1986 ACJ 344 (P&H). ", "21. The discussions we have made above, we feel, would make it clear that the submission made by counsel for appellant that the application is not maintainable is devoid of any merit. ", "22. Of course, we have to deal with a subsidiary point raised by counsel for the appellant that the jurisdiction of the is attracted only if the accident involving the motor vehicle should have happened in a public place. To substantiate this contention, counsel referred us to Section 95 of the Act. We shall examine the sustainability of the submission. ", "23. We have to bear in mind the intendment of Section 95 when we examine the correctness of the submission made by counsel for the appellant. The intention of the legislature to introduce Section 95 of the Act has to be understood in the light of Section 94 of the Act. Section 94 of the Act was introduced when the legislature felt the necessity for insurance against third party risk. It is to ensure that third parties who suffer due to user of motor vehicles should be able to get damages and recoverability of the damages should not depend upon the financial condition of the driver or owner of the vehicle who caused the accident and so, Section 94 of the Act obliged the owner of a motor vehicle to keep it insured. ", "24. In dealing with the necessity for insurance against third party risk, of course, the statute provides that no persons shall use except as a passenger or cause or allow any other person to use a motor vehicle in a public place, unless there is in force in relation to the use of the vehicle by that person or that other person, as the case may be, a policy of insurance complying with the requirements of Chapter VIII of Act 4 of 1939. The statute mandates the necessity for a valid policy in force in regard to the motor vehicle if it is intended or used in a public place. Section 95 of the Act which deals with the requirements of policy and limits of liability also uses the words \"arising out of the use of the vehicle in a public place\" but it is significant to note that in dealing with the jurisdiction of the under Section 110 (1) the statute does not make it a condition that the accident should occur by the use of the motor vehicle in a public place. Section 92-A of the Act is indicative of the fact that liability to pay compensation arising out of the use of a motor vehicle need not be the use of the motor vehicle in a public place. ", "25. We shall also consider along with the question of the width of term 'public place' the question of insurance company's liability. That has to be answered with reference to Sections 94 and 95 of the Act. As per Section 95 (1) (b) of the Act, insurer is liable to pay compensation to the extent specified in Sub-section (2) of Section 95 of the Act for the death of or bodily injury to any person or damage to any property of a third party if the same is caused by or arises out of the use of the insured vehicle in a public place. Section 2 (24) of the Act defines what is public place. It means a road, street, way or other place, whether a thoroughfare or not to which the public have a right of access and includes any place or stand at which passengers are picked up or set down by a stage carriage. Admittedly, in this case the accident took place not in a road, street or way. If at all, it can be considered as a public place, it can only be a place to which the public have a right of access. In order to attract this part of definition, it must be proved that the public have a right of access to that place. It is not enough that as a matter of fact the public have access. 1970 ACJ 44 (Madras). Even where access to particular road or place is permissive, it cannot be said that public have a right of access to such road or place. Hence such road or place cannot be regarded as public place. 1982 KLT 468. In v. 1981 ACJ 343 (MP), has held that service station premises is not a public place. ", "26. We do not propose to give in this case a final verdict as to the question whether the premises of the service station is a public place within the meaning of the definition of public place in the Act. The phrase \"right of access\" mentioned in the definition of public place has to be given a meaningful interpretation, taking into account the purpose of the legislation. The general principle now accepted in regard to question of interpretation is purposive interpretation as against the literal interpretation. In this case, apart from the fact that the insurance company can put forward a defence that the accident took place not in a public place, there can be a valid defence for the insurance company to get itself exonerated from the liability on the ground that the contract of insurance is a contract of indemnity and by the insurance policy, the company has undertaken to indemnify the loss that would have been occasioned to the owner, in case he is compelled to pay damages on account of the accident. Certainly, in this case the owner who is the victim is not compelled to pay compensation to the legal representatives of the victim and so, there is no question of indemnifying the insured and so, the insurance company is not in any way liable to pay compensation that has to be awarded in this case. ", "27. We have said that the liability to pay compensation is a liability under the general law of . We have already determined in paragraph 10 the status of the appellant in this case as that of a bailee. What happened is clear. An employee of the bailee caused the accident by his negligence. Allowing the employees to sit in the driver's seat also is an act of imprudence and negligence on the part of the appellant. If the accident has occurred in the same way as it has occurred in this case and if the victim is not the owner of the vehicle, but a stranger, it will be difficult for the bailee to say that he is not liable for compensation. Perhaps, that stranger victim may have a cause of action against the owner of the vehicle also. If circumstances are brought out to fasten liability on the owner of the vehicle or in case the owner fails to get himself extricated from the liability on the basis of exceptions that can be claimed when the accident has occurred on account of the negligence of the bailee both the owner and the bailee may be liable to pay compensation to the injured or legal representatives of the deceased. Anyhow, in general law it is not difficult to find liability for the negligence of the person who was on the driver's seat. There is no dispute that the person who was on the driver's seat, was solely responsible for the accident and that he was the employee of the appellant. We have no hesitation to hold that the person who actually caused the accident by his negligence has no defence to escape liability to pay compensation. He is bound to account for his negligence. If the person who is primarily bound to account for the negligence is the employee of the appellant, the appellant is also vicariously liable to account for the negligence of his employee. ", "28. There are decisions to the effect which would show that the bailee's sole interest is essentially possessory and it is demonstrated by his ability to recover for injury to the goods without proof of personal loss against a stranger and is consistent with the principles of bailment generally. A right to immediate possession is better characterised as generating a constructive rather than an actual possession. ", "29. In v. (1877) 3 NZ Jur (NS) CA 10 at 16 per , said: ", "Until I heard Mr. 's able and ingenious argument, it never occurred to me to doubt that the law is that either or bailor may sue a wrongdoer for the entire damage done to the chattel bailed. And after careful consideration of the argument and examination of the authorities, I adhere to my previous opinion. ", "There is no dispute that a bailee's possession is a prerequisite or to which it is one of several grounds of potential qualification. His lack of full ownership does not preclude him from recovering the full value of the chattel or the full cost of its impairment; the rule in such circumstances is that \"as against a wrongdoer, possession is title\", Vide The Winkfield, (1902) p. 42 at 60 and Bailment by Palmer, 1979 ., p. 177. ", "30. in his book Bailment says: ", "It was only in the present century that the bailee's rights of action against a wrongdoer were finally established, although decisions granting him an action in trover for full value of the goods can be traced from the beginning of the 19th century. It was at first unclear whether his use of this or any remedy was conditional upon his liability to the bailor; if it were not, he would stand to recover more than he had lost, while the wrongdoer would be forfeiting more than the extent of his immediate damage. ", "31. We have considered now only the 's right to recover damages from a wrongdoer in regard to the goods bailed. But the question that has to be focussed is the liability of to third parties. Again we rely on Bailment by Palmer at p. 966. Referring to decided cases, the learned author has epitomized the rule thus: ", "The bailee's responsibility for injury or loss inflicted upon a stranger to the bailment by the chattel is a simple facet of the ordinary law of negligence or trespass and does not necessitate exhaustive discussion. He will be liable if, through the negligent misuse of the chattel by himself or his servants acting in the course of their employment, a third party is foresee-ably injured or property is foreseeably damaged. ", "We feel that the appellant whose status is that of a , in the circumstances, is accountable for the negligence of his employee. So, necessarily, we have to hold that the appellant is liable to pay compensation to the claimants. ", "32. Now, we have answered the points regarding jurisdiction and other question of law against the appellant and the question of the liability to pay compensation by the insurer in favour of the insurance company. So we have to dismiss the appeal, M.F.A. No. 175 of 1990. The appellant has challenged the quantum of compensation allowed by the . The question of quantum of compensation we will be dealing when we deal with the cross-objection. ", "33. Now we have to consider the cross-objection filed by the claimants, we have upheld the finding that the first and second respondents are liable to pay compensation to the claimants, the petitioners in the cross-objection. The claimants have claimed a total amount of Rs. 4,00,000/- as compensation. By the award, the determined a total compensation of Rs. 1,61,760/- with interest at 12 per cent per annum from 2.5.1986 till date of realisation and proportionate costs from respondent Nos. 1 and 2 in O.P. (MV) No. 305 of 1986. The claimants submit that the compensation awarded is inadequate, insufficient and not fair. Of course, in the matter of determining compensation, the court should approach the question on the basis that it must be fair and reasonable. The court is not expected to approach the problem as if the respondents are wrongdoers in the sense that they have to be penalised. ", "34. The petitioners in cross-objection claimed a total compensation of Rs. 4,00,000/-under different heads. In part I claimants wanted the compensation under three heads: ", "(i) Transport to and from hospital Rs. 250/- (ii) Damage to clothing and articles Rs. 250/- (iii) Funeral expenses Rs. 7,500/- ", "On the above three heads, the allowed the first two claims in toto and for the third claim, viz., funeral expenses, the allowed an amount of Rs. 1,500/-. Strictly speaking funeral expenses is not an item which can be claimed. This is on account of the fact that death is a certain event, though we cannot predicate when exactly it will happen and when it happens it is the duty of the living to bury the dead. But, in the case of death due to an accident as against the natural death, unforeseen expenses have to be incurred and there is nothing wrong in allowing a small amount under this head and that is what has been done in this case. The has awarded only Rs. 1,500/-. ", "35. In part II, the claimants have claimed an amount of Rs. 25,000/- as compensation for pain and suffering, Rs. 25,000/- as compensation for loss of consortium to the 1st petitioner and Rs. 3,40,000/- as compensation for loss of income on account of death. The awarded Rs. 5,000/- as compensation for pain and suffering of the deceased. The accident had occurred at about 2 p.m. At the time, when the victim was taken to the hospital, he was conscious. That is clear from the evidence of PW 1. The end came on 11.12.1985, at about 11 a.m. and considering the serious injury suffered by the victim which resulted in his death, the amount of Rs. 5,000/- as compensation for the pain and suffering of the deceased allowed by the is only fair and reasonable and we confirm 's determination of compensation on this count. ", "36. Though in the petition Rs. 25,000/- is claimed for loss of consortium to the 1st claimant, there is no specific claim for the loss of filial affection and care for the two minor children. The deceased was aged only 38 years. He seems to be a successful businessman, who was conducting a bus service. The has awarded only Rs. 5,000/- as compensation for loss of consortium to the 1st claimant. We feel that the amount awarded is inadequate. We are of opinion that in the circumstances of the case, the 1st claimant is entitled to an amount of Rs. 7,500/- for the loss of consortium and the children together are definitely entitled to an amount of Rs. 5,000/- for the loss of love and affection of their father. ", "37. There is no separate claim for loss of expectation of life, which is an allowable claim in determining compensation payable in the case of death on account of motor vehicle accident. Though there was no specific claim on this count, has held that in the total claim made by the claimants if a legitimate count has not been specifically mentioned, the court is not precluded from allowing a reasonable amount under a legitimate count if by allowing, the total amount will not exceed the claim. We feel, in the circumstances, considering the age of the victim, the claimants are entitled to an amount of Rs. 5,000/- on account of the loss of expectation of the life of the deceased. Of course, the amount goes to the estate of the deceased and the estate naturally devolves on the legal representatives, who are the claimants before us. ", "38. Now we have to decide the question of loss of contribution to the claimants from the earnings that could have been made had the victim survived. This is the main claim. The claimants wanted under this count an amount of Rs. 3,40,000/-. The found that the contribution that could have been given for the maintenance of the family by the deceased, if he had survived, is Rs. 960/-per month. The has taken 960 as the multiplicand and applied 14 as the muliplier and calculated the amount at Rs. 1,61,280/-. From the said amount for the vicissitudes of life and for lump sum payment a deduction of 1/14th of the total amount has been effected by the and found Rs. 1,49,760/- as the net amount. Though PW 1 has given evidence that her husband was earning Rs. 10,000/- per month for six months immediately prior to the accident, by conducting the bus service, the did not accept this evidence and determined comparatively a low figure of Rs. 1,200/- stating that it would be a reasonable amount to be fixed as his monthly income. From the amount of Rs. 1,200/- the deducted 1/5th for the personal expenses of the deceased and came to the conclusion that the contribution the deceased would have given for maintenance of his family as Rs. 960/- per month. In fixing the multiplier the only said the deceased is aged 38. No other basis is given for determining the multiplier as 14. Considering the age of the deceased and the nature of the business the deceased was carrying on and the fact that the widow is aged only 38 at the time of filing the application and other two claimants who are minors aged 13 and 8, we feel that the multiplier adopted by the is not justifiable. Further, it has to be remembered that has said that the normal expectancy of the life of an Indian is 70. In view of all these facts, we feel that the multiplier, if it should be fair and reasonable, must be 20. Calculating on that basis, the total amount payable under this count will come to Rs. 2,30,400/-. Further taking into account that we have adopted the monthly contribution for the purpose of determining the compensation under this head as Rs. 960/- while the claim of the claimants is Rs. 10,000/- per month, which was attempted to be proved by producing Exh. A-9 we feel that for payment of the amount as a lump sum and the vicissitudes of life 1/6th of the total amount should be deducted. Deducting 1/6th of the total amount the net amount will come to Rs. 1,92,000/-. ", "39. In the result, the total amount of compensation payable is Rs. 1,92,000/- + Rs. 24,500/- (on other miscellaneous counts) i.e., Rs. 2,16,500/-. We allow the cross-objection and modify the award, directing respondent Nos. 1 and 2 in the application to be jointly and severally liable to pay an amount of Rs. 2,16,500/- with 12 per cent interest from the date of the filing of application till payment to the claimants. We apportion thus: ", "Rs. 75,000/- with interest at the rate of 12 per cent from the date of application till payment to the widow, the first claimant and Rs. 70,750/- with interest at the rate of 12 per cent to each of the minor children. If any amount has already been paid in this case, it has to be adjusted. The minor's share should be deposited in a nationalised bank for such period till the minors attain majority."], "relevant_candidates": ["0000661219", "0000957900", "0001039429", "0001217339", "0001282179", "0001435406", "0001776507", "0001971593"]} {"id": "0000153131", "text": ["JUDGMENT , C.J. ", "1. This Appeal against the Judgment of , J., in C.M.S.A. No. 130 of 1954 arises in the following circumstances. One filed O.S. No. 675 of 1952 in , Tiruchirapalli, against , the respondent herein, for recovery of possession of the property in dispute and for past and future rents. In that suit the parties entered into a compromise and based on that compromise the Court passed a decree directing the respondent herein to deliver possession of the property by 15th March, 1954 and also to pay past and future rents. As the respondent failed to deliver possession by the prescribed date, the plaintiff-decree-holder filed E.P. No. 240 of 1954 on 18th March, 1954, for delivery of possession. An order for delivery was passed on 12th April, 1954, directing delivery by 10th Jnne, 1954. On 15th April, 1954, the respondent filed an appeal to , Tiruchirapalli, against the order for delivery (A.S. No. 177 of 1954). In that appeal he obtained on ex parte order of stay on 15th April, 1954, itself. On 27th May, 1954, the original decree-holder died. On 8th July, 1954, dismissed A.S. No. 177 of 1954 on the ground that the order of delivery was right. The learned Judge inter alia observed as follows: ", "The right given to a tenant by Section 7 of the Act is a substantive right and there is nothing in the Act to indicate that it is retrospective in the application. Therefore, there can be no question of applying the provisions of the Act, so as to hold that the order of delivery passed against the appellant is wrong. It is urged that Section 7 not merely vests a right in the appellant but prohibits the from evicting him. If that is so, it is for the appellant to ask the which is threatening to evict him to stay his hands (whether it is bound to do so or not is not a matter on which I am expressing any opinion); not to come in appeal against an order which is perfectly proper and legal. ", "2. Apparently the view taken by the learned District Judge was that Section 7 of the Madras Buildings (Lease and Rent Control) Act would not make the original order for possession ipso facto invalid, but it might be that the judgment-debtor could object to actual eviction in pursuance of the order. After the dismissal of his appeal the respondent filed an application, E.A. No. 845 of 1954 on 12th July, 1954, for Stay of execution. Meanwhile the son of , the present appellant before us, filed an application on the same day that he may be added as legal representative of the decree-holder praying for a decree directing delivery of possession of the suit property to him. The ground taken by the respondent was that the Rent Control Act had been extended to the village in which the property was situated on and from 16th June, 1954 and therefore the decree-holder's legal representative could not evict him. The learned District Munsif of Tiruchirapalli overruled the respondent's objection and brought the appellant before us as the legal representative of the deceased decree-holder and passed again another order for delivery of possession to the legal representative. Against this order of the District Munsif the respondent filed an appeal, A.S. No. 261 of 1954 which was heard and disposed of by the learned Subordinate Judge of Tiruchirapalli. He dismissed the appeal on the ground that Section 7 of the Act would not apply to pending execution proceedings, that is to say, to the prior execution petition wherein an order for eviction had already been passed. From this order the respondent preferred an appeal to this Court, C.M.S.A. No. 130 of 1954 which came up for decision before , J. The only question argued before him was whether the Rent Control Act whose application had been extended to the village in which the property was situated only on 16th June, 1954, would prevent the eviction of except in accordance with Section 7 of that Act. The learned Judge after an elaborate discussion of the several decisions cited before him held that Section 7 of the Act does apply and is a complete answer to the claim of the decree-holder's legal representative to evict the respondent. The learned Judge therefore allowed the appeal and dismissed the execution petition filed by the decree-holder's legal representative but granted leave to file a Letters Patent Appeal. ", "3. Mr. , learned Counsel for the appellant, contended, relying upon the well-known rule against implying retrospective operation of statutes, that Section 7 of the Act would only apply to decree passed in suits filed after the passing of the Act. In this case admittedly the decree was passed long before the Act, and even an execution petition had been filed before the Act came into force. We cannot agree with this contention of learned Counsel for the appellant. Na authority has been cited to us for this extreme position that Section 7 would not apply except to decrees passed in suits filed after the passing of the Act. On the other hand of this Court held in (1949) 1 M.L.J. 376 : A.I.R. 1949 Mad. 809, that a provision similar to Section 7 of the Act of 1949 might bar the eviction of a tenant in execution of a decree passed in a suit filed before the concerned statute. In that case the suit was filed in 1943 for eviction of the tenant. On 11th July, 1944, Clause 8 of the Madras Non-Residential Buildings Rent Control Order, 1942, was amended and when so amended the clause ran as follows: ", "A tenant in possession of a non-residential building shall not be evicted therefrom, whether in execution of a decree or otherwise...except in accordance with the provisions of this clause. ", "4. It was contended before that the moment a person files a suit he obtains thereby a vested right to have applied not only to the suit, but to all execution proceedings also, the law relating to execution as it existed at the time of filing the suit. The learned Judges had no difficulty in rejecting this contention as they were not aware of any such principle. They found no reason to think that if a new law is introduced restricting the right to execute, execution proceedings can nevertheless be instituted if such a right existed on the date of the filing of the suit. The observations of , J., in The United Provinces w. Mt. Atica Begaun (1941) 1 M.L.J. Sup. F.C. 65, were relied on behafore but the learned Judges did not agree that the observations in any way affected their decision. Actually in that case the decree was passed after Clause 8 of the Non-Residential Buildings Rent Control Order had been amended in the manner aforesaid. The execution petition was filed subsequently. The decision of the learned Judge was that Clause 8 prohibited the decree-holder from filing an execution petition, his only way of evicting the tenant being to file an application before the Rent Controller. No doubt there is a reference to pending proceedings in one part of the judgment but it was not necessary to deal with the point because they held that during the interval between the passing of the decree and the filing of the execution petition there was no pending proceeding. The basis of the decision is certainly against the view that Clause 8 would not affect pending proceedings. Mr. relied upon the decision of , in v. (1945) 1 M.L.J. 441. In that case the Chief Judge of dismissed an application for ejectment. That application was filed on 18th March, 1944. There was a sub-letting of a portion in June, 1943. Possession was to be given on 14th April. On 14th April the plaintiff when he sought to obtain possession was obstructed by the respondent. Thereupon an application was made to and that Court dismissed the application. The learned Judge adverted to the difference in the language between the old Section 7-A, Madras House Rent Control Order and the new Section 7-A. The learned Judge took the view that had no jurisdiction to invoke the new provision and construe it to operate retrospectively. He allowed therefore the revision petition before him and set aside the order of . In the concluding portion of his judgment there are certain observations which really are pertinent for the disposal of this case, namely: ", "If and when an application for possession comes before the Controller, the Controller should apply his mind to the circumstances actually and presently before him to enable him to make or refuse an order, and it would be for one side or the other to point out that the application for ejectment had lost its force owing to the fact that since the application has been made, difficulties which were then not in existence had arisen or difficulties that were in existence had disappeared. ", "5. We must confess we are not able to fully appreciate the scope of these observations. The Division Bench in (1949) 1 M.L.J. 376 : A.I.R. 1949 Mad. 809, understood this passage thus: ", "It is seen from this passage that the learned Judge, far from thinking that the landlord had, by the institution of his application for possession in the Sub-Court, acquired an absolute right to physical possession, contemplated proceedings before the rent controller in which it would be contended by the tenant that in view of the new legislation, actual possession could not be given. ", " (1949) 1 M.L.J. 452, it was pointed out by a Division Bench to which one of us was party that the jurisdiction of a Civil Court to entertain and pass a decree in a suit for eviction by a landlord against his tenant is not expressly or impliedly taken away and that Clause 8 of the Madras Non-residential Buildings Rent Control Order, which corresponds to Section 7 of the Madras Buildings (Lease and Rent Control) Act, 1949, prevents the tenant from being thrown out. One of the methods of eviction is by the process of execution of a decree for possession and it was held that this method was prohibited and eviction could only be in accordance with the provisions of the Rent Control Order. ", "6. In our opinion this appeal can be disposed of on a very short point. This appeal arises out of an execution petition filed on 12th July, 1954, (E.P. 240 of 1954) by the legal representative of . There was no doubt a prior execution petition filed by himself and an order for eviction but admittedly the respondent had not been evicted in pursuance of that order. That is why after the death of his legal representative, the appellant before us, was compelled to file another execution petition praying for delivery of possession. That admittedly was filed after the Rent Control Act had come into operation in the village in which the property was situated. We fail to see how the principle against retrospective operation is offended in this case. It is not as if during the pendency of E.P. No. 240 of 1954, out of which this appeal arises, that the Rent Control Act came to be extended to the suit village. By the date of the filing of the present execution petition the Act had come into force. The executing Court which was bound to apply the provisions in the statute had come into force even before the date of the execution petition which it was called upon to dispose of. In our opinion there is no substance in the contention of learned Counsel for the appellant. ", "7. It was argued but without the support of any authority that Section 7 would not apply to compromise decrees. Once a decree is passed, we can see no difference on principle between a decree passed on a compromise and a decree passed after contest. ", "8. Mr. sought to raise a new point which was not raised by him in the Courts below and not even in the memorandum of appeal, namely, that as the respondent had obtained a stay of the order for delivery passed by the learned District Munsif of Tiruchirapalli on 15th April, 1954, on the misrepresentation that the Rent Control Act had been extended to the suit village, he was disentitled to any relief based on the provisions of the Act. We do not have the order of stay passed by the learned District Judge nor a copy of the affidavit filed by the respondent in support of his application. We do not know what prompted the learned District Judge to pass the ex parte order. In the absence of even a specific ground in the Letters-Patent Appeal, we do not think the appellant should be allowed to raise a new point at this late stage. The appeal fails and is dismissed with costs."], "relevant_candidates": ["0000461959", "0001201177"]} {"id": "0000161423", "text": [", J. ", "1. This is a suit to recover Rs, 3,00,000 pursuant to an agreement in writing dated March 7, 1944, or alternatively as money paid for a consideration which has wholly failed. The defendant admits the making of the agreement and payment to him by the plaintiff of the sum sought to be recovered. He contends (inter alia) that the consideration has not failed wholly, that on the true construction of the agreement the money is not repayable, and that the agreement has been terminated by frustration. ", "2. The contract out of which the suit arises is admittedly contained in two letters exchanged in Bombay on March 7, 1944. That addressed by the defendant to the plaintiff reads as follows: ", "I agree to purchase for you and on your behalf 300 bales Grey cotton yarn merchantable quality each bale weighing 400 lbs. of which 100 bales shall be of 20 x 2S and 200 bales of 42 x 2S counts and to ship the same from Jattarabad to Khoramshare. ", "You will provide to me the cost of purchase and all other expenses incidental to conveying the goods from Bombay to Jaffarabad such as carting, railway freight, storage and other charges, which shall be paid to me on presentation of the invoice. ", "On my loading the goods on a country craft and handing over to you the shipping documents, I will be entitled to receive from you Rs. 25 per bale and 5% commission on the total cost involved. ", "In case I am unable to effect shipment of the goods or if the country craft, for any reason, fails to cross the territorial waters of Jaffarabad, I will repay to you the cost paid as per my invoice and all other expenses incurred in taking the goods to Jaffarabad and I will lose my right to claim from you as remuneration Rs. 25 per bale and 5% commission and will refund to you the same if paid. ", "Apart, of course, from transposition of the parties, that addressed by the plaintiff to the defendant differs materially from its twin brother only in that it contains the words \"from Jaffarabad\" after the words \"shipment of the goods\", thereby making abundantly clear that which is common ground, namely, that the shipment contemplated was shipment from Jaffarabad and nowhere else, in the last paragraph. Jaffarabad is in Janjira State, Kathiawar, and Khoramshare is a Persian Gulf port. ", "3. The surrounding circumstances which must have been present to the minds of the parties and which I am entitled and bound to take into consideration in construing this contract are matters of common knowledge. A world war was in progress, with far-reaching effects on commercial and other life even, in Western India. Among its minor horrors in that and other areas was an abundance of that which is popularly called \"red tape\", although in fact bureaucrats ordinarily use white tape, presumably to disarm criticism. Almost every activity of the citizen was subject to a greater or less degree of interference, direct or indirect, by officials, including a control of prices. While, therefore, the war had produced in India a serious shortage of yarns and textiles, great profits were to be made by exporting these and other articles to the Persian Gulf. This traffic the Governments of British India and/or Bombay were desirous of stopping, and to have exported such goods from a British Indian port would have been difficult, if not impossible. It was unquestionably the object of the parties to evade the ban on export of the goods in question, and while they no doubt hoped and expected that their venture would be less likely to be interfered with in an Indian State) than in British India, Mr. , for the defendant, with his wonted frankness, admits that they did not imagine that the rule of \"red tape\" ceased absolutely at the frontiers of the latter, nor conceivably could they have done so. ", "4. The multitudinous regulations which have to be promulgated to ensure the efficient prosecution of a modern war are, undoubtedly, a great nuisance. No one could possibly carry them all in his head and the most law-abiding and patriotic citizen may constantly break them by inadvertence. Often they bear the marks of incompetent draftsmanship and one wonders in some particular cases whether they are really conducive to their very desirable end. None the less, their deliberate evasion stands on a very different footing from the perfectly legitimate pastime of finding and exploiting loopholes in normal, peacetime, legislation. To indulge in that practice is the perfect right of a free citizen, and, even if it served no other useful purpose, provides interesting and lucrative work for the legal profession. ", "5. The evasion of regulations made in the time of war with a view to the ultimate deliverance of one's country from that curse, and that for the sake of a commercial profit made while one's fellow citizens are fighting and dying on the field of battle, seems to me, to say the least of it, less commendable. Their. common object having been what it was, I have not, myself, the slightest sympathy, in the events which have happened, for either of the parties. ", "6. Another circumstance which must have been present to their minds had nothing to do with the war, though it was equally notorious. The monsoon might be expected to break in Bombay about the third week of June and in Kathiawar very little later. \"Country craft\" in which it was proposed to effect shipment, are somewhat primitive lateen-rigged sailing vessels, capable of long and surprisingly fast passages in fair weather, but very illfound for surviving a monsoon gale, a fact patently obvious to anyone with any knowledge of seamanship who has ever inspected one of these ships. No master of a country craft in his senses would set out on a voyage to the; Persian Gulf at a time when he could not be reasonably certain of getting well clear of the monsoon area before the monsoon broke: he would take his departure (if he was going to do so at all) by about May 31 at the latest. Both parties are, I gather, experienced Bombay business men, and this fact must have been as perfectly well known to them both as to anyone else of any intelligence in this port. ", "7. Mr. for the defendant wished to adduce oral evidence under the guise of \"surrounding circumstances\" to show that what the parties really meant by the expression \"in case I am unable to effect shipment of the goods\" was \"in case my licence or licences to export the goods should prove ineffectual\". But I felt bound to exclude any such evidence: to have allowed it in a suit, other than a suit for rectification, would, I think, involve a plain violation of Section 92 of the Indian Evidence Act. The rule as to \"surrounding circumstances\" cannot be extended to enable a party to prove that when he wrote one thing he meant, and was understood to mean, something totally different. ", "8. Between March 7 and 28 the plaintiff paid defendant three sums on account of one lakh each, and on or about the 28th the defendant presented, an invoice antedated to the 8th for 303 bales of yarn of counts not identical to those specified in the written contract, the total price being Rs. 3,37,768-12-0. The parties had admittedly agreed to vary the original contract as to counts, and it is unnecessary to go into this in detail or to discuss the matter of the odd three bales. ", "9. The plaintiff never paid the balance of Rs. 37,768-12-0 or any part thereof. He is not, therefore, asking for it back; nor is the defendant counter claiming for it. Whether the defendant even asked for it is in dispute, but the question appears to me quite academic in the events which have happened. ", "10. During and, I think, after March the defendant, who had entered into contracts similar to that in suit with numerous merchants other than the plaintiff, bought from time to time at Bombay in his own name very large quantities of yarn of which the 303 bales invoiced to the plaintiff formed a part. The bales which the defendant is pleased to call \"the plaintiff's bales\" have never been placed separately from the resit, or marked with the plaintiff's name, or in any other way physically appropriated to the plaintiff. The making out of the invoice already referred to did not serve that purpose, because in every case in which he charged for various numbers of bales of a given description, the defendant had in fact on hand more than that number of bales of that description: so that from first to last there never was a moment when anyone other than the defendant could have gone to the bales and picked out any specific 303 bales as the property of the plaintiff. It is true that the defendant might have done so, but there would be nothing to prevent his picking out a different 303 bales, corresponding to the bales in the invoice, five minutes later. The defendant has contended, as long as he could, that there was an appropriation to the plaintiff, but a timely summons for particulars eventually pinned him down to what was really an admission that this was not so at all. He also says that the plaintiff was aware of and consented to the course of dealing I have briefly described, but the same affidavit of particulars now discloses that what he really relies on is the con-sent and knowledge of one . Whether the latter had any authority from the plaintiff to give his consent is in dispute. The defendant, through his counsel, expressed his willingness to discharge the onus of proving that he had. It appeared to me, however, and still does, that this question, also, is now academic. I propose to discuss the legal effect of the foregoing after stating the remaining facts, ", "11. At some time-I am not sure when, nor does it matter-the defendant got hold of three licences signed by the of Janjira State in favour, respectively, of two individuals other than himself and of a Bombay firm, one of which permitted the export from Janjira to Khoramshare of 1,000 bales of cotton yarn. This was, however, valid only up to May 9. ", "12. In order to ship the goods at Janjira the goods had to be got to Janjira, and the defendant in fact set about doing this. The route he chose was by rail into the State of Cambay and thence by ship to Janjira. The plaintiff took no steps to obtain any necessary licence for the purpose of getting the goods to Janjira, holding, as he still maintains, that it was for the defendant to do so. ", "13. Apparently, all the goods in question were still in Cambay on June 14, 1944, on which date the export licence relied on by the defendant had long expired. Apart from that, it was then probably too late, in view of the approaching monsoon, to consign the goods by country craft even to Jaffarabad, and certainly too late to expect such a vessel to set out for I assume, as the contrary is not alleged, that the delay so far was due to no default or neglect by the defendant. ", "14. According to the defendant (and I assume the correctness of this for the purpose of deciding the legal aspects of issue No. 5), on June 14 the goods in question were (to use a metaphor which is not altogether happy in this climate) \"frozen\" by a notification by the of Cambay. Whether that official was inspired or pressed into issuing this notification by any power other than his own Prince I do not know, nor does it matter. The fact is that the further movement of the goods was prohibited and there at Cambay they have remained ever since. ", "15. While in a godown at Cambay they seem, of course, to have been, and to be, completely useless either for the efficient prosecution of the war or for any other purpose. There may be some reason, beyond my ken, by force of which cotton yarn locked up in a shed in Cambay is serving some useful and legitimate end; or, more probably, it may be that somebody is holding out for a bribe before he will permit the goods to be moved. On the off chance that this judgment should come to the notice of some responsible official who is both honest and reasonably intelligent, I venture to point out that the goods in suit might usefully be made available to would be purchasers. But, in any event, no official corruption or stupidity can convert the adventure on which the parties embarked into a patriotic one. ", "16. By his solicitor's letter of July 21, the plaintiff demanded the amount now claimed and stated that he would claim interest at six per cent, per annum. In the ordinary course this letter would have been received on the 22nd and the defendant had till the evening of that day in which to pay up and look cheerful. He did not do the former: whether he did the latter I do not know. ", "17. On August 21, 1944, the plaintiff commenced the present proceedings by way of a summary suit to recover the three lakhs he had paid the defendant, who obtained leave to defend, from my brother , on October 3, 1944. The general effect of the pleadings I have already endeavoured to summarise, and the following issues have been framed: ", "(1) Was it ever orally agreed between the parties that the contract goods should be shipped on or before April 30, 1944 ? If not, what was a reasonable time for shipment ? ", "(2) Was the contract between the parties varied as to counts, as alleged in paragraph 4 of the written statement ? ", "(3) Were the three lakhs referred to in the plaint paid in respect of the goods obtained by the defendant under the contract as so varied or in respect of some other and what goods ? ", "(4) On the true construction of the contract between the parties- (\") was it the duty of the defendant or of the plaintiff to obtain any export licence necessary for the purpose of conveying the goods to Jaffarabad ? (6) was it the duty of the defendant to get the contract goods to Jaffarabad or merely to use his best endeavours to get the contract goods to Jafferabad ? ", "(5) Was the contract frustrated as alleged in paragraph 6 of the written statement or at all ? ", "(6) Were 803 bales or some other and what number of bales obtained by the defendant as agent for the plaintiff ? If so, do those bales, in the events which have happened, belong to the plaintiff? ", "(7) Were the goods is the last issue mentioned collected at Cambay ? If so, were they so collected by the defendant as the plaintiff's agent ? If so, were they so collected with the (a) knowledge and/or (b) consent of the plaintiff'? ", "(8) Was the plaintiff at any and what time or times ready and willing to carry out his part of the contract between the parties ? ", "(9) To what, if any, relief is the plaintiff entitled ? ", "18. The answers to issues Nos. 2 and 3 are now admitted to be \"Fes\", and consequently I have dealt with these matters as shortly as I could. Mainly at the suggestion of learned counsel for the defendant, but with the approval of learned counsel for the plaintiff, issue 4 was dealt with first with the object of saving time. In fact, Mr. for the defendant was unable to keep his argument on this question and on the legal aspects of issue 5 in separate and watertight compartments, and I have in fact heard-with great interest and pleasure-all his submissions on both these topics. ", "19. I framed the second part of issue 4 on a suggestion which it seemed to me the written statement implied, but in fact it has not been, and could not be, seriously contended that the contract in question was merely a contract to endeavour to ship certain goods: it was an absolute contract to ship them with a special provision as to what should happen if that proved impossible: and obviously the goods could not be shipped at Jaffarabad, (which was admittedly the contemplated port of shipment) until they had been got there, or failing that, until other goods of the same description had been obtained at Jaffarabad. ", "20. Issue 4(a), like the latter part of issue 1, is a question of construction. The contract is in writing, and any ambiguities in it are patent ambiguities: None of the provisos to Section 92 of the Indian Evidence Act is applicable and therefore the materials I am allowed to use are, first and foremost, the grammatical and ordinary meaning of the words used taken as a whole, and, secondly, the surrounding circumstances which must have been present to the minds of both parties. If the grammatical and ordinary meaning of the words produces an absurdity or a repugnancy with the rest of the instrument, I may depart from it so far as may be necessary to avoid that absurdity or repugnancy, but no further. (See the famous passage in his speech in v. (1857) 6 H. L. C. 61, 106 often referred to as Lord \"'s \"Golden Rule\")- The rule may work hardship in some cases and possibly-though I am by no means so persuaded -this is one of them: on the whole it is undoubtedly productive of infinitely more good than harm. I am also entitled to imply a term, if it is necessary to give the contract business efficacy, but not otherwise. (The Moorcock (1889) 14 P. D. 64). well known judgment to that effect in that case has subsequently been further explained by that other great commercial Judge, The very clear test which the latter held to be applicable was this: let it be supposed that at the time of contracting the question of expressly including the term sought to be implied had arisen. If the is satisfied that the parties would both-not one, but both-have said, \"We need not bother about that, it is too obvious\"-then the term should be implied: but otherwise it cannot be. ", "21. I now look at this contract, bearing these weighty pronouncements in mind. It imposes on the defendant, as it seems to me, four duties, two absolute and two contingent, namely, (1) To buy the goods; (2) to ship them at Jaffarabad; (3) if (2) proved impossible, to refund any money paid to him by the plaintiff; (4) to make the like refund if after shipment the ship failed to reach the high seas. ", "22. It is a hybrid contract, being in the main one of agency and in part one of guarantee, though in fact the latter part never came into operation. ", "23. Clearly there is no express term that the plaintiff should obtain any licence whatsoever, and I am quite unable to see why one should be implied. If I agree for Rs. 500 to go from here to Delhi there cannot, in the light of The , or of test, be an implied term that the other party to my agreement should buy my ticket for me: indeed, the present case is even clearer than that because there was an express term that the plaintiff should pay to the defendant the defendant's expenses of performing his part. It must, therefore, have been for the defendant to do the work and incur, in the first instance, the expense (if any) of getting the necessary licence, which expense (if any) he would be entitled to be reimbursed; or if he did not like actually to put his hand into Ms pocket, it was for the defendant to ascertain the expense and claim it in advance from the plaintiff. The latter he never did. The only decided case (so far as I can discover) which even superficially conflicts with this view is . 2 K. B. 784, but the facts there were quite different from the present facts. In that case oil, for the export of which during the 1914-18 war a licence was required, was sold f.o.b. Manchester. It was held that it was for the purchaser to get the licence. But why ? Simply because it was an ordinary f.o.b. contract and therefore it was the vendor's duty merely to put goods of the contract quantity and description on board a ship nominated by the purchaser: it was for the latter to nominate an effective ship, i.e. a ship both legally and physically capable of carrying the goods (see per Scrutton. L.J. at p. 798). The obtaining of the licence was no more the business of the vendor than the necessary repairs would be if the buyer had nominated a ship with a hole in her bottom. The present contract was not a contract of sale at all but one of agency, as, indeed, Mr. rightly admits: but, he says, \"it was for the plaintiff to do all essential things as I was only an agent.\" Carried to its logical conclusion, this argument means that to earn his remuneration an agent need do nothing, or, at all events, nothing that matters: which is absurd. The answer to this issue, is, therefore, (a)-Of the defendant; (b)-The former, ", "24. Really, the main part of Mr. 's able and interesting argument dealt with issue 5, assuming for its purpose the facts to be as his client contended. I regret that as I was at all material times in charge of the miscellaneous list it was not possible to hear that argument with anything approaching continuity, but that was the fortune of war, and I have done my best to follow it with the attention it deserves. I do not think that I am doing it any injustice by summarizing it into two cumulative or alternative propositions, viz. ", "(1) On a true construction of the contract in suit \"inability to ship the goods\" only begins when the goods are at the port of shipment: ", "(2) My contract was frustrated by the action of : consequently I am released from its further performance. ", "25. I cannot see the force of the first proposition once it is determined that it was for the defendant to do whatever was needful to get the goods to Jaffarabad. In saying this I assume that other goods of the contract quantity and description were not obtainable at Jaffarabad. This assumption is in the defendant's favour, because if such goods were obtainable, he might be liable not merely to refund the plaintiff's money but to pay him damages as well. You cannot ship goods until you get the goods to the ship or the ship to the goods, and it was the former that had to be done in the present case. If that essential preliminary could not be done, shipment was just as impossible as it would have been if the goods had been got to Jaffarabad but all the stevedores of that port had been on strike. Suppose that someone is good enough to invite me to lunch with him at 1 p.m. on a Wednesday in term time at . I should answer, with regret, that I could not do so, because my duty required me to be at , several miles away, at the time in question. My would-be host would surely be himself inaccurate if he charged me with inaccuracy in the use of language, saying, \"It is not that you can't lunch with me but merely that you can't come to .\" I should rejoin, if I were to pursue such an unprofitable argument, \"If I can't come to , a fortiori I can't lunch with you there,\" and I should have thought this was obviously correct. According, however, to Mr. 's contention, inability to lunch would only arise if (my board for the day having miraculously collapsed) I made my way post-haste to and arrived by one o 'clock, but on arrival was prevented from consuming my host's good cheer by a fit of apoplexy or an attack of tetanus, or some such cause, I think this argument carries its own refutation with it: for it must, surely, be conceded that the defendant here was either \"able\" or \"unable\" to effect shipment of the goods within the meaning of the present contract. If, therefore, he was not \"unable\" to do so, it means that he was \"able\" to do so: that is to say, that he was \"able\" to ship at Jaffarabad goods which he could not get to Jaffarabad- which is absurd. ", "26. Turning to Mr. 's second contention, the doctrine of frustration has been one of gradual growth. The general rule of law (exemplified in its full harshness in v. (1641) Aleyn 26) was that a man, come what may, must either perform his bargain or pay up. If he failed to provide in his contract against the event which happened, more fool him. An apparent exception to this was, however, early recognised in contracts of which the continued life of a particular human being formed the basis. In contracts for personal services, for example, there is no implied covenant by the servant that he will keep alive till the end of the period of his service, and a suit for damages against his personal representative for breach of contract by dying is, so far as I am aware, unknown. This is very notable, because, the death of the servant being inevitable sooner or later, the parties might very well have contemplated the possibility of its occurring during the term of the contract and provided therein what was to happen if it did. Doubtless, there is no reason why a man should not by apt words covenant that he would not die before a stipulated date, but I doubt if anyone has even seen or heard of such a contract. ", "27. The law advanced a considerable step in v. (1868) 8 B. & S. 820 where it was held that the continued existence of a particular thing, in that case a music hall, formed the basis of the parties' contract and that the casual destruction of that thing discharged each party from further performance of the contract, although there had been no breach of it by the other. ", "28. The next important development occurred in consequence of the postponement of King Edward VII's coronation, when the happening of a particular event was recognised as a possible \"basis for the contract\", so that its failure to happen discharged the contract. v. [1903] 2 K. B. 740 and v. [1904] 1 K. B. 498 are cases of this period. In the latter case it was held that rent already paid for a room from which to view the coronation procession could not be recovered even though the contract was frustrated by the postponement of the coronation. The happy lessor was thus, no doubt, enabled to let the room all over again to someone else when the coronation did take place, and so reap a second harvest, while the lessee was left lamenting. It was not an ornament of common law and is now, happily, overruled. ", "29. The Avar of 1914-1918--till lately called \"Great\"-witnessed a further development, in the recognition by decisions of of the continued existence of a given state of things, including a given state of the law, as an element so fundamental in some contracts (such as charterparties and building agreements) that its cessation frustrated those contracts. To this epoch belong, amongst other important decisions, , Tamplin Steamship Co., Ld. v. , Ld. [1918] 2 A. C. 397; v. , Ld. [1918] A. C. 119 and Bank Line, Ld. v. [1919] A. C. 485. In many of the so-called \"Great War\" cases, frustration was held to have been brought about by a change in the law of the land-not the physical impossibility, but the supervening illegality, of carrying on the original adventure was held to have discharged the contract. This well illustrates the proposition that the doctrine of frustration is not really an exception to the rule that a man must pay damages if he breaks his contract, for there can be no default in not doing that which the law prohibits. Lord said of the doctrine o\u00a3 frustration in Denny Moti & Dwkson, Ld, v. & Co., Ld. [1944] A. C. 265, 274 (p. 274) = I should prefer to describe it as a substantive and particular rule which the common law has evolved. Where it applies there is no breach of contract. What happens'is that the contract is held on its true construction not to apply at all from the time when the frustrating circumstances supervene. From that moment there is no longer any obligation as to future performance, though up to that moment obligations which have accrued remain In force. ", "His Lordship then deals with the case of a contract for personal services, which I have already mentioned, and then proceeds (p. 274) :- ", "A rule of this character obviously admits of almost indefinite exemplifications, as numerous and diverse as are the possibilities of the performance of a contract being interrupted by a vital change of circumstances. The law, however, has examined a great variety of cases in which it has held or refused to hold that a contract is nullified as to its future by the impact of a frustrating event. The application of the general principle must depend on the circumstances of the particular case. No detailed absolute rules can be stated. A certain elasticity is essential. ", "I believe the last judicial echo of the 1914-1918 war was the decision of their Lordships of in v. , Ld. [1926] A. C. 497, where, in a characteristically brilliant judgment delivered by Lord , the frustration of a time charter was held to put an end to a reference, therein contained, to arbitration; with the result that when, applying a great deal more elasticity to the law than Lord afterwards considered essential, an arbitrator awarded damages for subsequent non-performance to the disappointed party, he was acting without jurisdiction. In one respect, which I shall point out later, this is the strongest decision in the defendant's favour. ", "30. During the present, or we may possibly hope, immediate past, war the doctrine again engaged the attention of the highest tribunal in Great Britain on several occasions, including 's case (supra). Perhaps the most noteworthy of these is v. , Ld. [1943] A. C. 83 where v. (supra) is overruled. The also took a hand in the matter by producing the Law Reform (Frustrated Contracts) Act, 1943. The unlamented demise of v. is not of direct importance to this country where the law, thanks to Section 65 of the Indian Contract Act, was at all material times more in accordance with the (in Lord 's view) more civilized law of Scotland. But it is of some indirect importance in the present case as showing that, even in darkest England, money paid pursuant to a frustrated contract, the payment of which produces no benefit to the payer, may be recovered from the payee, and that in a case in which the parties have not expressly provided that it should be so repaid. ", "31. Though the law of frustration has been long developing and though the topic has been repeatedly considered by the very highest tribunals, I am not aware of a single case in which that doctrine has been held applicable to an express contract to repay money in case of the supervening impossibility of performance of a major obligation. It is rightly conceded that it is open to parties to make their own bargain about this or, in general, any other matter: nor could one doubt that if two citizens, foreseeing the possibility of an inflammation of the Royal appendix or of an abdication, had agreed for the hire by one to the other of a room to watch a coronation procession on the express terms that the rent should be paid in advance but refunded in case this procession did not take place, the would not, even in the unenlightened ago in which v. was decided, have allowed the lessor to keep the rent, even if he had incurred expense on making the room fit for the lessee's brief occupation. There is, to the best of my belief, no reported instance of a claim under such a contract, but the whole ratio decidendi in the decided cases where the doctrine has been held applicable is that the frustrating event was outside the contemplation of the contracting parties. The exact opposite is the case here-they have in terms provided what was to happen in case of impossibility of performance-unless indeed I am bound to give the words \"In ease I am unable to effect shipment of the goods\" a meaning more restricted than their grammatical and ordinary meaning. In, I think, most of the reported cases in which war or one of its effects was held to be a frustrating cause, the contract in suit was made before the war actually started. The case (supra) is a good example of this class. No ordinary and reasonable man, contracting even in July 1914, could have been expected to foresee the wholesale interference with the liberty of the subject which even the so-called \"Great\" war produced-even in the countries which were fighting to preserve that liberty. The only reason why the remedy was not as bad as the disease was that the evils of the remedy were for the most part less abiding than those of the disease. It is true that the phenomenon of war was not unknown before August 4, 1914; but that which we are pleased to call \"civilization\" advances-or retrogresses (whichever be the correct expression)-not steadily but by jerks; and an ordinary man contracting in July 1914 could no more have predicted, by reason of what had happened in the Napoleonic, Crimean and Boer Wars, the state of things which would be prevailing in England in (say) 1917 than could such a man, contracting in August 1939, have foreseen the atomic bomb. Cases of this class do not, I think, assist the defendant, who made his contract when the war was, and all its consequences were, in full swing. ", "32. Cases such as the Sank Line case (supra) (described by Lord at p. 453 as \"a very near thing\"), v. (1917) 84 T. L.R. 70, (said by no less an authority than Pickford L.J. to be \"very near the line\") and case (supra) are more helpful to the defendant. So, to take a case arising out of the 1926 \"General Strike\" is The Penelope [1928] P. 180. In this last mentioned case, the contract was made when the industrial horizon of Great Britain was heavily overcast, and contained a common form of strikes and lockouts clause; but the contract itself showed (which I feel to have been fundamental in Lord 's judgment) that the parties did not contemplate anything comparable to that which happened, viz. the impossibility of shipping any coal at all from any port whatever in South 'Wales or elsewhere in Great Britain for a period of many months. The Bank Line case is sharply contrasted with case: the latter was that of a time charter made before the war, and already in operation at its outbreak, containing a \"restraint of princes\" clause and an express power to sublet. It was held not to be frustrated by the requisition of the chartered ship or even by her conversion from an oil tanker into a troop ship. In the former case, a time charter made after the war contained a \"restraint of princes\" clause, but the ship was requisitioned before she was even delivered to the charterers at all. Despite the fact that the contract was made during the war, the adventure was held to be frustrated by the requisition of the ship, largely because at the time of that event, as opposed to the time of the trial, it was completely uncertain and unascertainable when, if ever, the ship would be available for purposes of the charter, which destroyed the identity of the chartered service. In the case this principle was extended from a time charter to a voyage charter at time rates, and again there was a \"restraint of princes\" clause. Here also the ship never became available to the charterers. As the case was said to be, and if I may say so, obviously was, \"very near the line\", I must be very hesitant of extending it. In no one even of these cases was there a provision in express terms as to what was to happen in case the main object of the contract proved impossible of attainment, which in my humble judgment distinguishes them from this case without entering into other, and more minute, possible distinctions, case is, therefore, I think, the most helpful to the defendant. Its general effect I have already stated. In dealing with it I feel that it is most important to notice the exact terms of the reference therein discussed. It appears from p. 498 of the report that they were, so far as material, as follows: ", "Any dispute arising under the charter shall he referred to the arbitration of two persons...etc. ", "Could a dispute which arose only at the moment when, as their Lordships held, the charter was brought to an end and both parties were released from further performance of its obligations, be held to arise \"under that charter\" Their Lordships held that it could not: the termination of the charter as a whole terminated the reference as surely as the complete collapse of a house would involve the destruction of a picture attached by a nail to one of its walls. But supposing the parties had added after the words \"under this charter\" some such expression as \"including any question as to its frustration\"-what then? I cannot doubt that then their Lordships' decision would have been in the opposite sense-there would in reality have been two contracts written on the same piece of paper, the one frustrated, and the other not. Such, unless indeed I ought to give a very restricted and unnatural meaning to the words I have already, set out, is the present case. For what, it may be asked, has happened which renders it physically or legally impossible for the defendant to pay the plaintiff Rs. 3,00,000? The answer must be ''nothing.\" In these circumstances, I feel that my decision on this question must turn not on authority but on pure construction of the particular contract before me. Why should I give to the words in question a narrower meaning than that which they grammatically bear? ", "33. Substantially, two reasons for this are advanced. First, that if I do not do so the bargain is an absurdly hard one on the defendant. Secondly, that some effect must be given to the presence, in relation to the ship's possible failure to reach the high seas, of the words \"for any reason\" and the very conspicuous absence of those words from the clause relating to the defendant's inability to effect shipment. ", "34. I see little substance in the former argument. There is a loss, and as the parties have not agreed to share it, one or other of them must bear it. It seems to me no more unreasonable to throw it on one than on the other. Mr. contends, in effect, that if the defendant was to bear the loss, it makes the contract, from the plaintiff's point of view, one of \"heads-I win: tails-- you lose.\" It means that the defendant carries the whole risk. I do not think that is really correct: the plaintiff took the risk, common to all contracts involving credit and trust reposed by one man in another, of the insolvency or dishonesty of the defendant: all maritime risks after the passing by the ship of the three mile limit were for the plaintiff's account. He might minimize the latter by insurance, if he chose, and if the defendant gave him adequate notice of shipment (which he was not bound to do), but if so, lie would have to pay the premium and to chance his arm as to the solvency of the underwriters-a not great, but still appreciable, risk. Last but not least, a change in the legal or economic state of things at Khoraroshare might have made a highly profitable contract into a disastrous loss: no doubt, this was highly unlikely, but unlikely things sometimes happen, and this risk was entirely the plaintiff's. In any event, if the defendant has made not merely an unpatriotic but also an improvident bargain, I should be the last to mend it for him even if I had (as I have not) power to do so: and certainly the contract according to its ordinary and grammatical meaning is not so absurdly one sided as to justify my departing from that safe and sound standard of interpretation. I feel all the more confident about this as it is, as I think, clear that the defendant, and not the plaintiff, in the events which have happened, is the beneficial owner of the goods, for what they may be worth. This will, at any rate, minimize his loss and possibly enable him to pay the plaintiff his three lakhs without undue inconvenience. For reasons already indicated I do not particularly rejoice at either event. ", "35. Conversely, I feel very strongly the force of the second of these arguments. I must, if I can, give some meaning and, preferably, a sensible one, to every word or series of words, and if the presence in one part of the contract of a phrase absent from another part makes the latter in its ordinary meaning nonsensical, I should be fully justified in seeking some other meaning for the latter. According to Mr. , the only way to make the two material parts of paragraph 4 of the letter both sensible when read together is to hold that \"In case I am unable to effect shipment\" means \"In ease I am unable by reason of any cause now in our mutual contemplation to effect shipment,'' while \"if the country craft for any reason fails to cross the territorial waters of Jaffarabad\" means what it says, except, of course, that \"Jaffarabad\" means \"Janjira\". ", "36. This contention, though superficially most attractive, is, I think, fallacious. The causes which might lead to failure of shipment are of two classes-the inability, through circumstances beyond his control, of the defendant to do so, or his unwillingness to do so-bad luck on the one hand, and default on the other. Similarly, the ship might fail to reach the high seas for causes either external or internal to herself and her company, or, indeed, through a combination of such causes. She might be overwhelmed by a gale, captured by a pirate, torpedoed, or swallowed whole by some as yet unknown sea monster, before she had sailed one marine league. Equally, she might fail to accomplish that modest feat through mutiny, barratry of the master or mariners, or through the drunkenness of the former, the latter, or both. ", "37. As regards failure to ship by the default of the defendant the contract is silent and, obviously, the parties left the law to take its course as to what should happen in this event. If- in preference to shipping the plaintiff's goods the defendant had sold them to the highest bidder at Jaffarabad, he would have had to pay damages which must have exceeded, and might have far exceeded, three lakhs: obviously, the parties did not say anything about this because it was unnecessary to do so, as it was too obvious that such would be the ease. The express provision for a refund, etc., in case of inability to ship was therefore purposely, I think, limited to inability. To make it clear that this was not the case as to failure of the ship to sail three marine miles, but that as to this the defendant was, shipment once having been effected, an absolute guarantor, the words \"for any reason\" were necessarily included where they are included and, I think, deliberately omitted, as being unnecessary, where they are omitted. By the one clause the defendant limited and defined his liability in the event of inability to perform his bargain: by the other, he unconditionally guaranteed that a particular ship with particular goods on board would sail to a point one marine league from low watermark of ordinary spring tides, but no further, and waived his right to remuneration if this event should not occur. That seems to me a perfectly reasonable and sensible contract, and to involve no such absurdity as to compel or permit me to construe words as meaning something different from that which, according to their grammatical and ordinary interpretation, they mean. ", "38. To summarize my conclusions on this issue, they are these: I assume in the defendant's favour that it was the action of which prevented his shipping the goods within the time and at the place the contract contemplated,-as the goods were not apparently held up till June 14, and the export licences he had somehow come by, in someone else's name, had by the time long expired, and as the monsoon might be expected on or about June 21, this is an enormous assumption-still the contract to pay money in case of inability to ship is most clearly severable from the contract to ship, and the frustration, if any, of the one does not affect the other. It is also a very great assumption to assume that the action of was outside the contemplation of the parties at the time of contracting, for I apprehend that was, technically at the least, at all material times a belligerent, and even if she were not, modern war is, amongst its other evils, grossly infectious. But making every such assumption, the answer to this' issue must still be:- ", "Not so far as the defendant's agreement to repay the sum in dispute is concerned. ", "39. That issue being disposed of, the answers to the remaining issues are, really, very simple. ", "40. Each party, despite their desire to dispose of issues 4 and 5 first \"to save time\" has ardently desired to adduce oral evidence as to other matters which (those issues being answered) do not arise. Had they done so, no time at all would have been saved. I should have been the last to stand in the way of either party in this case who wished to expend money on such deserving objects as Mr. for the plaintiff, Mr. for the defendant, or the solicitors instructing either of them, if it were not for the facts that I do happen to preside over a and not a moot club, and that there are other litigants who want their oases decided. I know that I \"ought not\" as a rule, \"to dispose of the whole case on a preliminary issue\", but the very words \"as a rule'' imply the existence of exceptions. Even where, as here, the parties, through their counsel (with exemplary politeness) \"threaten and intend\" to carry the matter to their Lordships of , I cannot see that I am justified in indulging in what may be a waste of public time for their benefit where, as here, I have a commercial dispute involving (I think) only the construction of an admitted document in the light of admitted events. If I am wrong, it is true, a new trial may be necessary on some or all of the issues: but, if 'f may be forgiven for saying so, it is just possible that I am right: in any case, if there is a new trial, the responsibility is mine and not that of either party. ", "41. Having said that, I now turn to the remaining issues. ", "42. 1. It will, again, be convenient to answer the latter part first. ", "43. I have to extract the answer from the written contract and the surrounding circumstances. Mr. contends that the parties contemplated shipment by a date sufficiently early to enable a country craft to clear the monsoon area before the monsoon. Mr, , that having regard to the date of the contract, shipment shortly after the monsoon-up to, say, the end of October 1944-would still be within a reasonable time. He, of course, admits that the monsoon itself was, so to speak, a \"dead period\". One notorious fact about modern war is that circumstances during it change very rapidly and radically. A good contract in May might well have proved a crazy one in October. In these circumstances, and all others, I think that, Whatever might be the case about a similar contract made on March 7 in normal times, the latest reasonable date of shipment was May 31, Even if 1 am wrong, it does not greatly matter, because though the suit might possibly have proved premature if the goods could have been shipped at Jaffarabad on, say, October 30, in fact they could not have been, but have been immobilized right down to the present date. A fortiori, therefore, the answer to the first part of this issue is of completely acadamic interest. v , ", "44. The answer is: \"The first part does not arise: as to the second' part, on or before May 31, 3944.\" The answers to issues 2 and 3 are in \"each case now admittedly \"Yes.\" Issues, 4 and 5.1 have already answered. ", "45. Issue 6 is a little complicated, but again the material part of. it is the second, Again I make some very big assumptions in the defendant's favour, and in particular assume that Mr. was the plaintiff's agent to consent to a course of dealing, which otherwise would be, in the light of such well known authorities as v. (1865) 3 H. & C. 700 and v. (1874-75.) L.R. 7 H. L. 802, a clear breach of the defendant's duty as agent of the plaintiff. ere this not so, the plaintiff would be entitled to the relief he now asks, not under any special term of the contract at all, but on the ground that the contract which the defendant agreed to make on his behalf has never been made and, therefore, the consideration for his, the plaintiff's, payment of three lakhs has wholly failed. In this event, of course, no property would :have passed to the plaintiff. But >even on the assumption I propose to make, the same result as regards property follows, for nobody on earth could at any time definitely have said: which specific articles are and which are not the property of the plaintiff. In these circumstances it is absolutely impossible to hold that the property in any of the goods passed to the plaintiff. See ait, In re [1927] 1 Ch. 606, where wheat was sold c.i.f. England to and, in part, resold c.i.f. England to X, becoming bankrupt before any part of the wheat had been appropriated to X. It was held by a majority of , reversing the judgment of and restoring that of the Judge, that without prejudice to any right of proof X might have, the whole of the wheat passed to was trustee for the benefit of his creditors. : ", "46. But even if I am wrong about this and if the title to some (though who can say which?) of the goods at Cambay passed here to the plaintiff, in the events which have happened he is now entitled to none of them. It was a most clearly implied term that if the plaintiff should elect, as he admittedly has done, to have his money back rather than to take the goods, if any, for what they .may be worth, the defendant is entitled to make what he can of those goods. To maintain the contrary (which I need hardly say Mr. has never done) would be to deny the proposition (unfortunately, but notoriously, true) that you cannot both eat your cake and have it. Applying Lord Justice 's test, let us suppose that on March 7, 1944, this possibility had occurred to the parties. I cannot doubt that if, as I am prepared to assume, they are reasonable people, 'Some such dialogue as the following would have taken place: ", "Defendant: \"What is to happen if I buy goods for you, cannot ship them, : and therefore pay you back your money ?\" ", "Plaintiff: \" Well, you'll be entitled to the goods.\" ", "Defendant: \"I think we'd better provide for that in the contract.\" ", "Plaintiff: \"Surely, we needn't bother-it is too obvious.\" ", "Defendant. \"Yes, I agree.\" ", "47. The answer to this issue is, therefore, \"Strictly, it does not arise: but the articles alleged by the defendant to belong to the plaintiff do in fact belong to the defendant.\" ", "48. Issue 7 consequently does not arise, nor, since the plaintiff is only claiming what he is, does issue 8. As far as the now material part of the contract is \"concerned, there was nothing for the plaintiff to do except to receive his money, and it hardly needs saying that he was always ready and willing enough to do that. ", "49. The result of all this is that there will be a decree in favour of the plaintiff for three lakhs with interest thereon from July 23, 1944, to this date at six per cent, per annum simple, costs to be taxed, including costs reserved, and interest on the aggregate decretal amount at six per cent, per annum simple till payment."], "relevant_candidates": ["0037184081"]} {"id": "0000205027", "text": ["PETITIONER: INDIAN OIL CORPORATION Vs. RESPONDENT: . DATE OF JUDGMENT06/04/1988 BENCH: , (J) BENCH: , (J) RANGNATHAN, S. CITATION: 1988 AIR 1340 1988 SCR (3) 426 1988 SCC (3) 36 JT 1988 (2) 212 1988 SCALE (1)965 CITATOR INFO : RF 1989 SC 973 (9) ACT: Arbitration Act , 1940: Sections 30 and 33-Award of Arbitrator-Reasoned Award-What is-Arbitration clause requiring arbitrator to give reasoned award-Whether arbitrator required to give detailed reasons-Sufficiency of reasons depends on facts of the case- not to sit in appeal over award and review reasons. HEADNOTE: % In respect of sale of raw petroleum coke by petitioner to respondent there were three agreements, providing for sale, petitioner's right to shift raw petroleum coke at the risk and expense of the respondent in case of failure of Respondent to shift the same as agreed, and the Respondent's liability to pay interest on the value of stock not uplifted. There was default in payment and petitioner stopped supplies to respondent, filed a suit and obtained an order of attachment of stocks of raw petroleum coke, to the extent of Rs.6 crores, of the Respondent. The respondent filed an appeal as also an application for stay of the suit under Section 34 of the Arbitration Act. Meanwhile the petitioner terminated the agreement. Thereafter the respondent filed a suit and the passed an order for restoration of supplies. On an appeal by the petitioner, this stayed the order of restoration of supplies, and recorded the compromise terms, pursuant to which all proceedings were withdrawn by the parties. The petitioner's claim were referred to an Arbitrator, who passed an interim award, according to which the petitioner was not entitled to any interest nor any shifting charges. The petitioner challenged the said award, when it was filed in . The dismissed the petition and this special leave petition is against the 's order. It was contended before this that the Arbitrator has failed to give a reasoned award and so it is bad in law. Dismissing the special leave petition, this , ^ HELD: 1. It is obligatory in England now after the Arbitration 427 Act, 1979, that the award should give reasons. The purpose of Section 12 of the Act requiring the tribunal to furnish a statement of reasons if requested to do so before it gave its decision is to enable the person whose property or whose interests were affected, to know, if the decision was against him, what the reasons were. [435B-C] 'Law of Arbitration' by Justice . First Edition 1983 pp. 320 and 321, referred to. 2.1 In India, there has been a trend that reasons should be stated in the award. The reasons that are set out must be reasons which will not only be intelligible but also deal with the substantial points that have been raised. When the arbitration clause required the arbitrator to give a reasoned award, the sufficiency of the reasons depend upon the facts of the particular case. He is not bound to give detailed reasons. [435C-D] 2.2 The does not sit in appeal over the award and review the reasons. The can set aside the award only if it is apparent from the award that there is no evidence to support the conclusions or if the award is based upon any legal proposition which is erroneous.[435D-E] 2.3 The award in question is unassailable. According to the Arbitrator, because of the letter dated 18th October, 1982 of the petitioner addressed to the Respondent stating that if the outstandings and interest are not paid, further supplies would not be made, has been acted upon by the petitioner, which had not delivered any coke to the respondent, or made any offer to do so, the petitioner was not entitled to the interest in respect of the period from 18th October, 1982 onwards, nor to shifting charges in respect of any shifting on or after 18th October, 1982. On this reasoning, he had given the award. How the Arbitrator has drawn inference is apparent from the reasons. No proposition was stated in the aforesaid reasons, which could be objected to as an error of law. The reasons given by the Arbitrator meet the requirements of a reasoned award. It is apparent that the arbitrator has not acted irrelevantly and unreasonably. [432E-G; 434G-H] 2.4 Arbitration procedure should be quick and that quickness of the decision can always be ensured by insisting that short intelligible indications of the grounds should be available to find out the mind of the arbitrator for his action. This was possible in the instant case where the arbitrator has spoken his mind, and he is clear as to how he acted 428 and why he acted in that manner.[434H; 435A] ., AIR, 1923 P.C. 66; , 4 JT 1987 3 S.C. 239; , Suppl. S.C.R. 489; , 3 SCR 12 and , 2 SCR 903, referred to Bremer Handelsgesellschaft v. , 2 Lloyd's Law Reports 130, referred to. JUDGMENT: ", "CIVIL APPELLATE JURISDICTION: Special Leave Petition (Civil) No. 4557 of 1988. ", "From the Judgment and Order dated 21.3.88 of in Appeal No. 306 of 1988. ", ", and for the Petitioner. ", ", , , , and Mrs. for the Respondents. ", "The Judgment of the was delivered by , J. This petition under Article 136 of the Constitution challenges the judgment and order of of dated 21st March, 1988. The petitioner in this case on 23rd June, 1961, had agreed to sell to the predecessor of respondent raw petroleum coke. There was a second agreement on 22nd April, 1971. The said agreement was arrived at between the parties whereunder it was provided that in case the respondent failed to lift raw petroleum coke as agreed, the petitioner would have right to shift raw petroleum coke at the risk and expense of the respondent. There was a third agreement providing that in case of delay in payment, the respondent would pay interest at 4 per cent over the borrowing rate, on the value of the stock not uplifted. It appears that on 5th August, 1982, the respondent wrote a letter to the petitioner showing inability to pay the arrears of the price against delivery of raw petroleum coke. On 4th October, 1982 there was a stock of about 13,760 M.T.S. Of saleable raw petroleum coke lying at Gauhati Refinery. The petitioner on 18th October, 1982 wrote to the respondent that unless the outstandings as on 1st September, 1982 and interest were paid, the petitioner would not make further supplies. Thereafter the petitioner filed Suit No. 2187 of 1982 for payment and for attachment before judgment. On 21st December, 1982, it appears that there was an order of attachment of stocks of raw petroleum coke to the extent of Rs.6 crores of the respondent. The order was confirmed after notice. Respondent filed Appeal No. 858 of 1983. Thereafter respondent on 20th ostler, 1983 filed an application for stay of the suit under section 34 of the Arbitration Act, 1940 (hereinafter called 'the Act'). The petitioner on 11th July, 1983 terminated the agreement with effect from 31.8.83. The respondent thereafter filed Suit No. 122 of 1983 and applied for an order compelling the petitioner to make supplies. The learned District Judge passed an order on 28th April, 1984 for restoration of supplies. On 7th May, 1984 in petitioner's appeal viz., Civil Appeal No. 2476 of 1984, this stayed the above order. On 24th May, 1984 this 's order setting aside the order of the learned District Judge dated 28th April, 1984 and recorded the compromise terms. Pursuant to the compromise, all proceedings were withdrawn by the parties. On 11th December, 1984 matter relating to the petitioner's claims in respect of interest on stocks held from 1st October, 1982 onwards and expenses of shifting raw petroleum coke from 1st October, 1982 upto 31st August, 1983, were referred to arbitration of , a former Chief Justice of India. On 21st August, 1986 an interim award was passed by the learned arbitrator. Interim award was filed in and the petitioner challenged the said award. The learned single Judge of the High dismissed the petition challenging the interim award. of upheld the order of the learned single Judge. Hence this petition under Article 136 of the Constitution. ", "The main contention urged before us was that it was necessary in the present trend of law for the learned arbitrator to have given a reasoned award. The Arbitration Act , 1979 in England so enjoins. The arbitrator, according to the petitioner has failed to do so. Hence the award was bad and as such the decision of was wrong and leave should be granted from the said decision and the matter be referred to as several cases are pending on this point. ", "The learned single Judge of in his decision had observed that the award was undoubtedly not an elaborately reasoned award setting out all the reasons which prompted the learned arbitrator to arrive at the conclusion he did reach, but it was a speaking award. The learned Judge however, held that it was not necessary to examine this aspect since even if it was a speaking order, it was not bad in law. It is true that the law as it stands upto date since the decision of ., A.I.R. 1923 P.C. 66 that it was not necessary that all awards should be speaking awards. See in this connection the observations of this Court in , 4 JT 1987 3 S.C. 239. ", "Previously the law both in England and India was that an arbitrator's award might be set aside for error of law appearing on the face of it, though the jurisdiction was not lightly to be exercised. Since question of law could always be dealt with by means of a special case this is one matter that could be taken into account when deciding whether the jurisdiction to set aside an award on this ground should be exercised or not. The jurisdiction was one that existed at common law independently of statute. In order to be a ground for setting aside the award, an error in law on the face of the award must be such that there could be found in the award, or in any document actually incorporated with it, some legal proposition which was the basis of the award and which was erroneous. See Halsbury's Laws of England, 4th edition. paragraph 623, page 334. The law has undergone a sea change in England. It is obligatory in England now after the Arbitration Act , 979, that the award should give reasons. ", "In the instant case. the arbitrator has set out the history in the interim award. The arbitrator has stated that the agreement dated 22nd April. 1970 provided that I.C.L.. will uplift all available coke produced at the Gauhati Refinery by which name also the Noonmati Refinery was called. the said upliftment being so regulated that the quantity uplifted every week was equivalent to the production of coke at the refinery in the previous week and that whereas it was thereby further provided that the upliftment by I.C.L. shall also be as regulated that the accumulated quantity of coke in the refinery coke yard does not fall below 2500 tons and does not exceed 4500 tons. The other history of the matter, it was recited that the order dated 24th May, 1984 was passed by consent of the parties by this Court that the claim of for interest on stocks said to have been held in the Gauhati Refinery from 1st October, 1982 onwards and its claim for expenses of shifting the coke from 1st October, 1982 upto 3 1st August, 1983 would be referred to the arbitration of a retired Judge of mutually acceptable to the parties. Two preliminary issues, the arbitrator framed were, namely, (1) Is the claimant entitled to charge any interest on unlifted stock of raw petroleum coke in view of its letter dated October 18, 1982? and (2) Is the claimant entitled to any shifting charges in view of its letter dated 18th October, 1982? The gist of the letter dated 18th October, 1982 is set out in the arbitration agreement. The arbitrator in his award pro- to observe as follows: ", "\"And whereas it is not in dispute between the parties that since the said letter of 18th October, 1982, had not delivered or offered to deliver any raw petroleum coke for Now, therefore, having heard counsel for the parties and perused the documents and statements filed by them, the despatch and receipt of none of which is disputed, and having considered thereafter, I adjudge, hold and award as follows: The letter dated 18th October, 1982 is no bar to claim for shifting charges and interest in respect of the period from 1st October, 1982 to 17th October, 1982. Because of the said letter which has been admittedly acted upon by which had not delivered any coke to Or made any offer to do so is not entitled to the interest claimed in respect of the period from 18th October, 1982 onwards nor to shifting charges in respect of any shifting done on or after 18th October, 1982.\" ", "The aforesaid grounds are the reasons of the arbitrator for making the award. The award is that is not entitled to any interest nor any shifting charges. The reasons for the said conclusion are the aforesaid three factors mentioned by the arbitrator. How the arbitrator has drawn inference is apparent from the reasons. It is to be noted that this Court has been insisting on the arbitrators to give some indications to indicate how the mind of the arbitrator acts. This Court in the case of , Suppl. S.C.R. 489 was concerned with the decision of the Collector of . This Court observed that where an authority makes an order in exercise of a quasi-judicial function, it must record its reasons in support of the order it makes. This Court observed further that every quasi-judicial order must be supported by reasons. ", " , 3 SCR 12 where this Court was concerned with an award under section 10A of the Industrial Disputes Act, 1947. This Court observed that there was a need for a speaking order where considerable numbers are affected in their substantial rights. It was further reiterated that in such a situation a speaking order may well be a facet of natural justice or fair procedure. , 2 SCR 903, this Court reiterated that it was an implied term of the arbitration agreement that the arbitrators must decide the dispute in accordance with the ordinary law and they cannot decide disputes on the basis of their personal knowledge. The proceedings, it was held, before the arbitrators were quasi- judicial proceedings and they must be conducted in accordance with the principles of natural justice. It was, therefore, obligatory to give reasons. As mentioned hereinbefore there has been since then trend that reasons should be stated in the award and the question whether the reasons are necessary in ordinary arbitration agreement between the parties has been referred to . ", "In this case, however, we are in agreement with that reasons were stated in the award. We have set out hereinbefore the three grounds, namely, (1) The letter dated 18th October, 1982 is no bar to claim for shifting charges and interest in respect of the period from 1st October, 1982 to 17th October, 1982. (2) The inference drawn from the contents of the letter and (3) Because of the said letter which has admittedly been acted upon by , and which had not delivered any coke to Or made any offer to do so. For these reasons, the arbitrator held that , is not entitled to interest claimed in respect of the period from 18th October, 1982 onwards nor to shifting charges from 18th October, 1982. These are the reasons for giving the award. No error of law was pointed out in those reasons. Indeed no proposition of law was stated in the aforesaid reasons, which could be objected to as an error of law. There was, however, no error of fact. It was a possible view to take. It could not be urged that it was an impossible view to take. The arbitrator has made his mind known on the basis of which he has acted that, in our opinion, is sufficient to meet the requirements even if it be reasons should be stated in the award. It is one thing to say that reasons should be stated and another thing to state that a detailed judgment to be given in support of an award. Even if it be held that it is obligatory to state the reasons, it is not obligatory to give a detailed judgment. This question was considered by in England in v. , [1981] 2 . There Lord speaking for the court at pages 132 and 133 of the report observed as follows: ", "\"It is of the greatest importance that trade arbitrators working under the 1979 Act should realize that their whole approach should now be different. At the end of the hearing they will be in a position to give a decision and the reasons for that decision. They should do so at the earliest possible moment. The parties will have made their submissions as to what actually happened and what is the result in terms of their respective rights and liabilities. All this will be fresh in the arbitrators' minds and there will be no need for further written submission by the parties. No particular form of award is required. Certainly no one wants a formal \"Special Case\". All that is necessary is that the arbitrators should set out what, on their view of the evidence, did or did not happen and should explain succinctly why, in the light of what happened, they have reached their decision and what that decision is. This is all that is meant by a \"reasoned award\". ", "For example, it may be convenient to begin by explaining briefly how the arbitration came about- \"X sold to Y 200 tons of soyabean meal on the terms of GAFTA Contract 100 at US. $Z per ton c.i.f. Bremen. X claimed damages for non-delivery and we were appointed arbitrators\". The award could then briefly tell the factual story as the arbitrators saw it. Much would be common ground and would need no elaboration. But when the award comes to matters in controversy, it would be helpful if the arbitrators not only gave their view of what occurred, but also made it clear that they have considered any alternative version and have rejected it, e.g., \"The shippers claimed that they shipped 100 tons at the end of June. We are not satisified that this is so\", or as the case may be. \"We are satisfied that this was not the case\". The arbitrators should end with their conclusion as to the resulting rights and liabilities of the parties. There is nothing about this which is remotely technical, difficult or time consuming. ", "It is sometimes said that this involves arbitrators in delivering judgments and that this is something which requires legal skills. This is something of a half truth. Much of the art of giving a judgment lies in telling a story logically, coherently and accurately. This is something which requires skill, but it is not a legal skill and it is not necessarily advanced by legal training. It is certainly a judicial skill, but arbitrators for this purpose are Judges and will have no difficulty in acquiring it. Where a 1979 Act award differs from a judgment is in the fact that the arbitrators will not be expected to analyse the law and the authorities. It will be quite sufficient that they should explain how they reached their conclusion, e.g., \"We regarded the conduct of the buyers, as we have described it, as constituting a repudiation of their obligations under the contract and the subsequent conduct of the sellers, also as described, as amounting to an acceptance of that repudiatory conduct putting an end to the contract\". It can be left to others to argue that this is wrong in law and to a professional Judge, if leave to appeal is given, to analyse the authorities. This is not to say that where arbitrators are content to set out their reasoning on questions of law in the same way as Judges, this will be unwelcome to the . Far from it. The point which I am seeking to make is that a reasoned award, in accordance with the 1979 Act, is wholly different from an award in the form of a special case. It is not technical, it is not difficult to draw and above all it is something which can and should be produced promptly and quickly at the conclusion of the hearing. That is the time when it is easiest to produce an award with all the issues in mind.\" See the observations in , 20th Edn., page 291 Reasons for the Award and the decision referred to therein. \" ", "In a case of this nature, issues are simple, points are fresh and facts are clear, the reasons given by the arbitrator, in our opinion, meet the requirements of a reasoned award. It is apparent that the arbitrator has not acted irrelevantly or unreasonably. Arbitration procedure should be quick and that quickness of the decision can always be ensured by insisting that short intelligible indications of the grounds should be available to find out the mind of the arbitrator for his action. This was possible in the instant case. In the instant case the arbitrator has spoken his mind, and he is clear as to how he acted and why he acted in that manner. ", "The purpose of section 12 of the English Tribunal and Inquiries Act which required the statutory tribunal to furnish a statement of the reasons if requested to do so before it gave its decision was to enable a person whose property or whose interests were affected to know if the decision was against him what the reasons were. Justice in his Law of Arbitration, First Edition 1983, pages 320 and 321 states that the provision was read as meaning that proper and adequate reasons must be given. The reasons that are set out must be reasons which will not only be intelligible but also deal with the substantial points that have been raised. When the arbitration clause required the arbitrator to give a reasoned award and the arbitrator does give his reasons in the award, the sufficiency of the reasons depend upon the facts of the particular case. He is not bound to give detailed reasons. The does not sit in appeal over the award and review the reasons. The can set aside the award only if it is apparent from the award that there is no evidence to support the conclusions or if the award is based upon any legal proposition which is erroneous. ", "Judges in that light, the award in question was unassailable in the instant case. ", "In the aforesaid view of the matter, we are of the opinion that was right in the view it took. The special leave petition fails and is accordingly dismissed. ", "G.N. Petition dismissed."], "relevant_candidates": ["0000525017", "0000832348", "0000881364", "0001155131", "0001508507"]} {"id": "0000207204", "text": ["JUDGMENT , J. ", "1. This appeal under Section 378 . has been filed by the State of U.P. against the judgment and order dated 3rd October, 1981 passed by the then Sessions Judge in ST. No. 108 of 1980 whereby he acquitted all the three accused of all the charges framed against them. ", "2. In brief, the facts of the prosecution case giving rise to this appeal were as under: ", " , son of , lodged a report at station Gobardhan Mathura on 13.1.1981 at 8-45 P.M. and the local registered a case at case crime No. 13 under Section 302 I.P.C. The informant alleged in his report that on 13.1.1981 at about 6-30 P.M. he accompanied by his father (deceased), his uncle , servant , son of , and one were proceeding towards Gobardhan along with several cattle through a canal road. Accused , his son and his brother met the informant and others on the canal road and wanted to know their destination. The informant replied that they were going to Gobardhan and did business of cattle. The informant's sister was married to who left her on account of bringing inadequate dowry. Ultimately, the informant settled her second marriage but and others did not put any question as to why he had settled her second marriage. ", "3. Accused instigated his brother and son to kill the informant and others and he himself opened fire with a view to kill but he missed his aim. The informant and his companions took a turn and raised alarm. also opened fire and shot at his neck. sustained firearm injuries on his neck, fell down and died on the spot. On hue and cry, all the three accused took about turn and ran away. The informant left the dead body of his father in the supervision of his servant and . ", "4. He got a report prepared by one and accompanied by his uncle and others reached Police station and lodged the FIR. ", "5. After registration of the case, left the station and reached the village in question on the same night at about 10-00 P.M. and searched the assailants. Since there was no light available, he did not prepare inquest report. Next day at about 7-00 A.M., Panchayatnama and other papers were prepared by the I.O. He sealed the dead body and handed over to constable who took the dead body to mortuary. The I.O. interrogated , , and others and after inspection prepared site plan. He collected blood stained earth on 14.1.1981. All the accused were arrested by the and were interrogated. After completing investigation, the I.O. submitted charge sheet against all the three accused named in the FIR. ", "6. Accused was charged under Section 302 I.P.C. and the remaining two accused were charged under Section 302 read with Section 34 of the Penal Code. Accused was charged under Section 307 I.P.C. also. They all pleaded not guilty and claimed to be tried. ", "7. In order to bring home the charges against the accused, the prosecution examined , the informant, , brother of the deceased, who was said to be eyewitness of the murder, head constable and constable filed their respective affidavits, P.W.6 Dr. , the then C.M.O., Mathura, was examined to prove the post-mortem report which was prepared by Dr. . He led secondary evidence as Dr. had left the country and had gone to Libia, of the case was also examined and P.W.8 Constable also filed affidavit. ", "8. All the three accused admitted their inter se relationship as well as this fact that informant's sister was married to . further admitted that he did not bring his wife but he did not demand dowry. They pleaded that the witnesses are related to each other and was servant of . ", "9. Accused examined as D.W.1 and as D.W. 2, Assistant Record Keeper, S.P. office, Mathura to prove that one was also killed in the plots of village Doserash on 13.1.1981 and an entry was made in the G.D. dated 14.1.1981 of . One court witness , Inspector Commercial Taxes, , Bahaz, district Bharatpur was examined who disclosed that used to collect 5% as commercial tax on the sale of cattle except cow. ", "10. After appraisal of the evidence on record led by the parties learned concluded that how the assailants came to know that the deceased and others were going to Gobardhan along with their cattle through canal road and the light was not sufficient to identify the assailants. The prosecution witnesses were partisan and as such, he gave benefit of doubt and acquitted all the three accused. ", "11. Aggrieved by the judgment and order passed by learned Judge, the has come up in appeal. ", "12. We have heard learned A.G.A. and , learned Counsel for accused-respondents at length and perused the record carefully. ", "13. Learned Additional Government Advocate has contended that there was motive to the accused to commit murder as had left his wife and the informant had settled her second marriage. It was further urged that about 6-30 P.M. on 13.1.1981, there must have been sufficient light to identify the real assailants. The assailants were relatives of the informant and others and as such, there was no difficulty in recognizing them at about sun set. Moreover, the informant and his companions talked to the assailants. It was further submitted that the prosecution examined and , who are son and brother of the deceased respectively. It is true that they were related to the deceased but there was no question of doubting their presence at the scene of incident. was a resident of district Alwar and was an independent witness and as such, learned Judge erred in rejecting his testimony also. He was not justified in extending benefit of doubt to all the three accused who committed murder of in furtherance of their common intention. The incident was reported to the promptly within two hours of the incident at the station situate at a distance of six kilometers. In this view of the matter, the learned Judge committed error in appraisal of the evidence led by the prosecution and this appeal has to be allowed and accused are liable to be convicted. ", "14. On the other hand, learned Counsel for the accused-respondents urged vehemently that about at 6-30 P.M. in the month of January there must have been complete darkness and as such, it was not possible for the witnesses to identify the real assailants. It was submitted that on the same night , a hardened criminal of the area, was also killed and an entry was made in General Diary at P.S. Gobardhan on 14.1.1981, which was proved by . The murder of the informant's father was committed at an unknown place by the dacoits who killed also and the accused were rightly acquitted by the trial court. ", "15. We have given our anxious consideration to the submissions made on behalf of the parties and perused the entire record, including oral and documentary evidence led by the parties. We have gone through the impugned judgment also. The learned Judge was of the view that there was no motive for the accused to commit murder of and the murder did not take place at the place and in the manner as alleged by the prosecution. The trial Judge further found that it was the month of January and on account of complete darkness at the scene of alleged murder it was not possible for the informant or other witnesses to identify the real culprits and as such, he found that the prosecution could not bring home the charge against any accused beyond all shadow of doubt. ", "16. We are fully aware of the law on the point that there is no embargo on to appreciate the evidence afresh but interference in the order of acquittal should be made for compelling reasons. Generally, the order of acquittal shall not be interfered with because the presumption of innocence of the accused is further strengthened by the acquittal. The golden thread which runs through the web of administration of justice in criminal cases is that if two views are possible on the evidence adduced in the case, one pointing to the guilt of the accused and the other to his innocence, the view which is favorable to the accused should be adopted. The paramount consideration of the court is to ensure that miscarriage of justice is prevented. ( 2006 (56) ACC 219). ", "17. When we analyze and scrutinize the evidence in the light of aforesaid proposition of law, we find that the trial Judge committed error in appraisal of the evidence led by the prosecution and the prosecution had succeeded in establishing the guilt of the accused beyond reasonable doubt. Admittedly, Smt. , sister of , was married to accused , son of . The deceased () was father-in-law of and the informant is brother-in-law of . The third accused is real brother of and uncle of accused . It is thus clear that the parties were closely related to each other and were well known since marriage of Smt. with . It is further undisputed that after marriage of Smt. with , he left her and she was living in her . Prior to the murder of , had settled second marriage of Smt. but was not performed. Smt. had not been divorced by her husband. In this view of the matter, it is crystal clear that the accused had a motive to teach a lesson to his father-in-law and members of his family as they had settled second marriage of his wife, who had not been divorced by her husband. This action on the part of the informant must not have been relished by the accused. It is therefore incorrect to say that the accused had no motive. It will not be out of place to mention that motive has no significance in cases, which are based on direct evidence of eyewitnesses. ", "18. In the instant case, it is quite clear from the medical evidence coupled with eyewitness account that was done to death as a result of gun shot injuries on his neck on 13.1.81 at about 6-00 P.M. The doctor who conducted autopsy found that death had taken place about one day prior to the examination which was done at 5-30 P.M. on 14.1.1981. It is noteworthy that the doctor found one gunshot wound of entry trachea deep on the front of neck. There were fractures of third and fourth cervical vertebrae and laceration at the level of third and fourth cervical vertebrae. Moreover, trachea was punctured through and through just below thyroid cartilage. We therefore hold that had his unnatural death as a result of gun shot injury on his neck on 13.1.1981 at the time as alleged by the prosecution. ", "19. So far as the complicity of the three accused in the crime is concerned, the prosecution examined , and . As mentioned above, the prosecution version is that did business of sale and purchase of cattle and he used to bring cattle from Rajasthan. On the impugned date also, along with others were bringing the cattle to Gobardhan market for sale. They were coming to Gobardhan along with cattle through canal road. The accused met them in the way and made an enquiry. The deceased replied that they were going to Gobardhan to sell cattle. After having heard this reply and recognizing the deceased and exhorted his son and he himself opened fire. He, however, missed his target. The informant and others took turn and raised alarm. In the meantime, opened fire and shot at the neck of who sustained injuries, fell down and succumbed on the spot. On the alarm, all the three accused took about turn and ran away and the witnesses did not chase them on account of fear. and are no doubt son and brother of the deceased respectively. They wholeheartedly supported the prosecution story and stated in unambiguous words that first shot was fired by who missed his aim. It was who. fired the fatal shot at the neck of the deceased and thereafter all the three culprits ran away. They were cross-examined extensively on behalf of the accused but nothing could be elicited to show that they have not spoken the truth. denied the suggestion of the defence that one Jatav was also killed at the scene of incident by dacoits and the murder of was committed by unknown miscreants. The prosecution placed reliance on the testimony of also, who is a co-villager of the informant and is Brahman by caste. He too fully corroborated the testimony of other witnesses regarding participation of the three accused in the crime. He claimed to have seen the accused in his village as they had their relatives in his village. We find nothing in his cross-examination also to discard or disbelieve his testimony. ", "20. So far as sufficiency of light is concerned, we find that incident of murder took place on 13.1.1981 at about 6-30 P.M. Admittedly, the sun had set in but there was light in which the culprits could be identified. It may not be out of place to mention that even after sunset, one gets natural light and the persons known to each other may be identified correctly without any difficulty. In the case in hand, the parties were close relatives and were known to each other for the last several years. Moreover, they had a talk with each other regarding cattle and their destination and as such, it cannot be inferred that on account of complete darkness at the time of alleged murder, the witnesses could not identify the real assailants. It is noteworthy that the informant is an illiterate rustic villager and he affixed thumb impression on his written report. It is therefore not possible to conclude that the informant mentioned the exact time of incident. The scribe of the report used the word at about 6-30 P.M. In this view of the matter, we are unable to subscribe the view of the trial Judge that on account of complete darkness, it was not easy for the witnesses to recognize the culprits. ", "21. There were three accused who faced trial for committing murder of . Accused and , who are father and son respectively, were assigned the specific role of firing and exhortation also. We, however, find that neither role of exhortation/instigation was assigned in the FIR nor any overact was shown on the part of the third accused , son of , who is brother of . The witnesses examined on behalf of the prosecution did not utter a single word about role played by him except that he was accompanying and others. He was allegedly carrying a lathi. He, however, did not cause any injury to the deceased or to the witnesses. We are, therefore, of the opinion that his involvement in the crime had not been proved by reliable and convincing evidence and he was rightly given benefit of doubt. ", "22. In view of the aforesaid discussion and the reasons given above, we hold that the order of acquittal recorded by the trial Judge against accused-respondents and is not sustainable in law and is liable to be set aside. So far as the acquittal of accused-respondent is concerned, we see no valid reason to disturb his acquittal. ", "23. The appeal is, accordingly, partly allowed. The acquittal of accused-respondent is affirmed but acquittal of and is set aside. Accused is found guilty and convicted of the offence punishable under Section 302 I.P.C. Accused is convicted under Section 302 read with Section 34 of the Penal Code. We do not intend to hear learned Counsel for the accused on the quantum of sentence to be awarded as we are inclined to impose the lesser penalty prescribed under the law. Both father and son are, therefore, sentenced to undergo imprisonment for life thereunder. ", "24. Both and are on bail. A copy of this judgment shall be sent to , Mathura who will get both the accused arrested and lodged in Jail within a period of six weeks. He will intimate to this Court within eight weeks about compliance of the order from the date of receipt of a copy of the judgment. ", "25. A copy of this judgment shall be certified to the court of Sessions Judge, also for information and necessary entries. The lower court record shall also be transmitted."], "relevant_candidates": ["0001860318"]} {"id": "0000220787", "text": ["PETITIONER: KIRAN BEDI & . Vs. RESPONDENT: COMMITTEE OF INQUIRY & ANR. DATE OF JUDGMENT04/01/1989 BENCH: OJHA, N.D. (J) BENCH: OJHA, N.D. (J) VENKATARAMIAH, (J) DUTT, M.M. (J) CITATION: 1989 AIR 714 1989 SCR (1) 20 1989 SCC (1) 494 JT 1989 (1) 21 1989 SCALE (1)10 ACT: s of Inquiry Act , 1952/s of Inquiry (Central) Rules, 1972: Sections 4 and 8-B /Rule 5(5)(a)-- of Inquiry--Examination of witnesses--Sequence of--Issuance of formal notice under s. 8-B --When arises--Holding persons not entitled to be covered by s. 8-B , and compelling them to enter witness box at the inception while directing similarly placed persons to whom notice issued to be examined at the end--Whether justified--Whether discriminatory-Persons whose conduct being inquired into called upon for being cross-examined at the inception of the inquiry while persons similarly placed directed to be enquired at the end--Refuse to bind them- selves by oath and affirmation believing to be covered by s. 8-B -Whether can avoid consequences--Refusal--When justified. Indian Penal Code . 1860: Section 178- - of Inquiry---Directing filing of complaint for prosecution for failure to enter witness box--Whether complaint liable to be quashed for infringement of fundamental right. Constitution of India, 1950: Articles 14, 21, 32, 136 & 142- of Inquiry--Holding persons not covered by s. 8-B of s of Inquiry Act, 1952 and compelling them to enter witness box. while directing issue of notice to similarly placed persons-Whether discriminatory--On refusal--Directing filing of complaints under s. 178 --Whether infringement of fundamental rights--Writ Peti- tion/Special Leave Petition filed challenging order for filing complaints--Summons by Magistrate not chal- lenged--Maintainability of--Interference by --Whether called for. HEADNOTE: A consisting of two Judges of was constituted by to enquire into certain incidents in January 1988, involving the lawyers and the police sequel to an alleged incident of a lawyer, being apprehended by the students of a College, and banded over to the police on the accusation of committing an offence within the campus of the said College and his subsequently being brought in handcuffs by the police for production before a Magistrate, 21 who ultimately discharged him with direction to the Commis- sioner of to take action against the guilty police officials. In its interim report, the observed that it had 10 examine the conduct of various police officers, and, in particular, among others, the petitioners and recommended the transfer of the petitioners from their posts. In pursuance of a notice issued by the under Rule 5(2)(a) of the Rules, statements of cases on behalf of Bar Association and the er of together with the supporting affidavits were filed before the . The were required to be ready for examination from May 16, 1988 onwards but the counter affidavit and the list of witnesses had not been filed till 17th May, 1988, on which date the er of submitted two applications praying for postponement of hearing and for calling upon to start their evidence first and to call upon the er of to adduce the evidence thereafter. Rejecting these applications, the passed an order saying that since the had failed to file their counter affidavit or list of witnesses, the petitioners should be present in on May 19, 1988 for crossexamination. On the petitioners' refusing to enter the witness-box for taking oath for cross-examination, the decided to file complaints against the petitioners for an offence under s. 178 of the Indian Penal Code and in pursuance of which complaints were filed against the petitioners in under sub-s. (4) of s. 5 of the s of Enquiry Act, 1952 read with s. 346 of the Code of Criminal Procedure, 1973. The petitioners challenged these orders in this by way of writ petitions and Special Leave Petitions. This passed an order on June 2, 1988 directing to reconsider the whole question relating to the order in which the witnesses had to be examined in the case. In pursuance of the aforesaid order, the passed an order on 29th June, 1988 holding that the concept of burden of proof was not quite relevant in the proceedings before a , under the Act, which had been given free hand to lay down its own procedure subject, of course, to the provisions of the Act and the rules made thereunder and that it would be difficult for the committee to lay down 22 the manner in which the witnesses were to be examined, foregoing its right to examine any witness at any stage, if his statement appeared to be relevant, that merely because there were allegations against a particular person he would not be said to be covered under s. 8-B , which required a positive order from the , and that when mentioned that it was to examine the conduct of various Officers and others, it did not have in view s. 8-B of the Act. The specifically held that the three other persons to whom notices had been issued under s. 8-B would be examined at the end of the inquiry. On August 18, 1988 this quashed the orders of the directing the filing of the complaints and the criminal proceedings against the petitioners before the Metropolitan Magistrate and held (a) that the Delhi Adminis- tration had to examine first all its witnesses as required by Rule 5(5)(a) of the Rules framed under the Act; even those witnesses who may have filed affidavits already may first be examined in-chief before they were cross-examined, since it was stated that when the affidavits were filed the deponents did not know what the other parties who had also filed affidavits had stated in their affidavits; the ques- tion whether a party had the right of cross-examination or not shall be decided by the in accordance with s. 8-C of the Act; the direction to the to examine its witnesses first did not apply to those witnesses who fell under s. 8-B of the Act, who had to be examined at the end of the inquiry, as opined by the itself; (b) that the petitioners were persons, who fell under s. 8-B of the Act and had to be dealt with accordingly, and (c) that if the three persons to whom notices under s. 8-B had been issued were to be examined, even according to the , at the end of the inquiry there was no justifia- ble reason to deny the same treatment to the petitioners who were in the same position as those three persons; the action of the in asking them to be cross-examined at the beginning of the inquiry was, therefore, discriminatory; mere non-issue of notices to them under s. 8-B ought not to make any difference if they otherwise satisfied the condi- tions mentioned in s. 8-B ; the issue of such a notice was not contemplated under s. 8-B of the Act; it was enough if at any stage the considered it necessary to inquire into the conduct of any person and such person would thereafter be governed by s. 8-B of the Act. Reasons for this order were to be given later. Giving reasons for the above order the , HELD: 1. Recourse to procedure under s. 8-B of the Commis- 23 sions of Enquiry Act , 1972 is not confined to any particular stage and if not earlier, at any rate, as soon as the Com- mittee made the unequivocal declaration of its intention, in its interim report to examine the conduct of the two peti- tioners it should have issued notice under s. 8-B to the two petitioners, if it was of the view, for which view there is no justification, that issue of a formal notice under s. 8-B was the sine-qua-non for attracting that Section. At all events, the could not deny the petitioners the statutory protection of s. 8-B by merely refraining from issuing a formal notice even though on its own declared intention, the section was clearly attracted. [42C- , Suppl. S.C.R. page 401 and , 2 S.C.R. page 1, relied on. 2.1 The use of the word 'or' between clauses (a) and (b) of s. 8-B of the Act makes it clear that s. 8-B would be attracted if requirement of either clause (a) or clause (b) is fulfilled. Clause (a) of s. 8-B applies when the conduct of any person is to be enquired into whereas clause (b) applies to a case where reputation of a person is likely to be prejudicially affected. [42B] 2.2 The fact that no formal notice had been issued under s. 8-B would constitute no justification for not treating a person to be covered by that section if otherwise the ingre- dients of the said section were made out. Having once stated in its interim report in unequivocal terms, that the conduct of these two petitioners among others was to be examined, it was not open to the to still take the stand that s. 8-B was not attracted in so far as they were concerned. [42B-C] 2.3 Keeping in view the nature of the allegations made in the statements of case and the supporting affidavits filed on behalf of the various including the Delhi High Bar Association, requirement of even clause (b) of s. 8-B was fulfilled inasmuch as if those allegations were proved they were likely to prejudicially affect the reputation of the two petitioners. In view of the specific term of reference which contemplated taking of \"stringent action\" against all those responsible, even the career of the petitioners as police officers was likely to be affected in case an adverse finding was recorded against them and the principle that the report of a of Enquiry has no force proprio vigore does not, on a pragmatic approach to the consequences, seem to constitute sufficient safeguard so far as the petitioners are concerned. [43C-E] 24 The reason for the importance attached with regard to the matter of safeguarding the reputation of a person being prejudicially affected in cl. (b) ors. 8-B of the Act is not far to seek. [43E-F] Blackstone's Commentary of the laws of England Vol-I, IVth Edition, Corpus Juris Secundum Vol. 77 at page 268 and v. Davis, 55 American Law Reports page 171 referred to. 3.1 Section 8-B inter alia contemplates an opportunity being given to the person governed by the said section to produce evidence in his defence whereas s. 8-C inter alia gives him the right to cross examine the witnesses who depose against him. [45D] Not only that calling upon a person governed by s. 8-B to produce evidence in his defence at the very inception of the inquiry is a contradiction in terms inasmuch as in this situation such a person would really be required to disprove statements prejudicial to him of such witnesses who are yet to be examined, it would also reduce the right of crossexam- ination by such person to a mere formality for the obvious reason that by the time the witnesses who are to be crass- examined are produced, the defence of such person which would normally constitute the basis for the line and object of cross-examination would already be known to such witness- es and they are likely to refashion their statements accord- ingly. [45E-F] 3.2 Perhaps in a case where there is no other witness to give information about the alleged incident about which the inquiry is being held and the only person or persons who could give such information is or are the person or persons who are likely to be adversely affected by the inquiry, it may be necessary to depart from the above view as a matter of necessity. But this is not one such case. There are admittedly any number of other persons who can give evidence about what happened on the relevant dates. [45G] Since the two petitioners clearly fell within the cate- gory of persons contemplated by s. 8-B of the Act and were consequently entitled to the same treatment as has been accorded by the to the persons to whom notice has been issued by it under the said section, the was not justified in calling upon the two petitioners to stand in the witness box for cross-examination at the very initial stage of the enquiry. [54B-D] 3.3 The apprehension that in case a person governed by s. 8-B 25 was to be examined at the end and at that stage such person even at the risk of not producing his defence, for some reason, chooses not to appear as a witness, the would be deprived of knowing the facts in the knowledge of such person and such a course would obviously hamper the enquiry is more imaginary than real inasmuch as the power of the to call upon any person to appear as a wit- ness under s. 4 of the Act, which in terms is very wide and is not circumscribed by fetters of stage, would be available to the and it would be entitled to call such person as a witness even at that stage. [46A-C] 4.1 In view of the provisions contained in ss. 4 to 6 of the Act, and the rules framed thereunder a person could not, on the belief that he was covered by s. 8-B , avoid the consequence of ss. 178 and 179 , by claiming absolute immuni- ty from binding himself by an oath or affirmation for an- swering questions put to them. [51H; 52A] Mc Grain v. , 71 L. ed. 580; v. , 3 L.ed. 2d 1090; v. United States, 73 L.ed. 692; v. United States, 32 L. Ed. 2d 212 and v. Walker40 L.ed. 819, referred to. However, a valid justification put forth by the witness was sufficient ground to make him immune from prosecution. [52F] v. United States, 1 L.ed. 2d 1273; v. United States, 3 L.ed. 2d 183 and v. Waterfront of New York, 12 L.ed. 2d 678 referred to. In the instant case, the petitioners are not asserting that they could not be required at all to appear as a wit- ness before the and make statement on oath. It was submitted on their behalf that they did not either wish to delay the proceedings or to show disrespect to , but only wanted to protect their own interest by making the submission which they made before the , as per legal advice given to them, namely that they being covered by s. 8-B of the Act their defence would be put to serious jeopardy and will be prejudicially affected if they were required to appear in the witness box for crossexamination at the very inception of the inquiry even before statements of witnesses proving the accusations against the petitioners had been recorded which they were entitled to defend. [52B- E] 4.2 On the view of the that persons covered by 8-B were to be examined at the end of the enquiry, the fact that an affidavit of the petitioner was on record could hardly justify the petitioner being 26 called upon to enter the witness box at the very inception. [55C] Smt. Indira Gandhi and another v. Mr. Commis- sion of Inquiry, ILR 1980(1) Delhi 552 referred to. 4.3 Had the not been labouring under the misapprehension that the petitioners were not covered by s. 8-B , because no notices under that section had been issued to them, notwithstanding the fact that their conduct was to be examined on its own declared, intention, it would obvi- ously not have required the petitioners to take oath for being cross-examined at the stage at which it did so. The subsequent orders of the directing complaints to be filed against the petitioners for an offence punishable under s. 178 and the act of filing such complaints were the consequences of the said misapprehension. [55F-G] Since the petitioners were covered by s. 8-B , the action of the in compelling the petitioners to enter the witness box for being cross-examined, when even according to it persons similarly situated were to do so at the end of the inquiry, was in itself discriminatory. There was, there- fore, valid justification for the refusal by the petitioners to take oath for cross-examination at the stage when they were required to do so. [55H; 56A-B] Therefore, the should not have, in the instant case, directed the filing of a complaint against either of the petitioners for an offence punishable under s. 178 . [56C] 5. Since the action of the in holding that the petitioners were not covered by s. 8-B of the Act and com- pelling them to enter the witness box on the dates in ques- tion was discriminatory and the orders directing complaint being filed against the petitioners were illegal, it is a case involving infringement of Articles 14 and 21 of the Constitution. In such a situation, the power of this to pass an appropriate order in exercise of its jurisdiction under Articles 32 and 142 of the Constitution cannot be seriously doubted, particularly having regard to the special facts and circumstances of this case. [56D-El The orders directing filing of complaints being invalid, the consequential complaints and the proceedings thereon including the orders of the Magistrate issuing summons cannot survive. [56E-F] 6. If the petitioners are compelled to face prosecution. in spite of 27 the finding that the orders directing complaint to be filed against them were illegal, it would cause prejudice to them. Therefore, this can interfere in the matter. [56G] 7. Apart from the directions contained in this 's order dated 18th August, 1988, it is not expedient to lay down any particular rigid procedure to be followed by the with regard to sequence in which witnesses were to be examined by it. [41G-H] JUDGMENT: ", "ORIGINAL JURISDICTION: Writ Petition (Civil) No. 626 of 1988 etc. etc. (Under Article 32 of the Constitution of India) , Additional Solicitor General, , , and for the Petitioners. ", ", Additional Solicitor General, , , , , , , , , , Miss , and , for the Respondents. ", "The Judgment of the Court was delivered by , J. In the writ petition and the special leave petitions filed by Smt. , the orders dated 17th, 20th and 23rd May 1988 passed by consisting of Mr. Justice and Mr. Justice of (hereinafter referred to as the ) are sought to be quashed whereas in the writ petition and the S.L.P. filed by , the order dated 26th May, 1988 passed by the said is sought to be quashed. ", "In order to appreciate the respective submissions made by learned counsel for the parties, it would be useful to give in brief the circumstances leading to the appointment of the and also to quote the terms of reference. What ultimately assumed the shape of confrontation between lawyers and police sparked off from an alleged unfortunate incident on 15th January, 1988 of a lawyer being apprehended by the students of and being handed over to the police on the accusation of committing an offence within the campus of the said College. According to the statement of case filed before on behalf of , the said lawyer was brought by the police in handcuffs for production before a Metropolitan Magistrate on 16th January, 1988. The lawyers present pro- tested against the handcuffing but their protest was ignored by the police officials. The Metropolitan Magistrate ulti- mately discharged the lawyer on the same date and also directed to take action against the guilty police officials. In support of their demand for action against the police officials, the lawyers went on strike from 18th January 1988. In the said statement of case it was further stated that on 20th January, 1988, Smt. , Deputy Commissioner of , North District, Delhi, made a statement in a Press conference justifying the action of police and criticising the order of the Magistrate in discharging a \"thief\" and that in order to express their deep concern and anguish a group of lawyers went to meet Smt. on 21st January, 1988 in her office which at that time was situated in the Tis Hazari Court Complex itself. Smt. , however, refused to come out and meet the lawyers whereupon they preferred to wait upon her till such time as she agreed to meet them. They assert that while they had waited for 15-20 minutes the police took recourse to lathi charge on the lawyers at the orders of Smt. . In the said statement of case it has further been asserted that while the indefinite strike and the agitation of the lawyers demanding a judicial inquiry into the incident of lathi charge and suspension of Smt. was continuing, a mob which eventually swelled to about 3000 persons came to Tis Hazari Court Complex on 17th February 1988 raising slogans in support of Smt. and against the striking lawyers. The mob used brickbats and stones causing injury to some lawyers and damage to property. According to them this mob attack was engineered by Smt. . A statement of case was also filed by , the then Commis- sioner of , attaching thereto affidavits of 25 police officers including an affidavit of Smt. . There is a denial on their part of the assertions and insinuations made against them by referred to above. With regard to the incident on 21st January 1988 the case of Smt. as is apparent from her affidavit filed along with the aforesaid statement of case is that she along with some other officers reached her at about 11.15 A.M. and while a meeting was in progress in connection with the arrangements for the Republic Day some time around 22.00 noon, slogans were heard \"being raised outside by an apparently large crowd approaching in our direction. Before we realised what was happening. all of sudden a group of lawyers stormed into my office pushing aside the female constable on duty at my door. They rushed towards me making violent gestures and uttering obsceneties at me. They made physical gesture and threats to the effect ....... The Officers who were sitting around my table jumped to their feet. They held back one of hysterical persons who had actually advanced in my direction and formed a ring around the lawyers and man- aged to move them out of my office while bolting me inside along with my female constable and a female visitor who had come to see me for her own work\". We have thought it proper not to quote the actual words of threat stated in the said affidavit. According to Smt. the situation there- after outside her office was handled by the other officers present while she remained inside the office. We are not concerned with the correctness or otherwise of either of the two versions stated above and as already pointed out we have referred to them only to indicate the background in which the was constituted. Having referred in brief to the circumstances which led to the appointment of the we now quote the order of reference: ", "\"F.No. 10/9/88-NP-II DELHI ADMINISTRATION: DELHI (HOME POLICE-II DELHI) Dated the 23rd Feb. 1988. ", "ORDER Whereas the Administrator of the Union Territory. of Delhi is of the opinion that a judicial inquiry is neces- sary into matters of public importance mentioned below; Now therefore, the Administrator is pleased to constitute a Committee, in consultation with the Chief Justice of Delhi High Court consisting of Mr. Justice and Mr. Justice Hon'ble Judges of to inquire into and record their findings on the following: ", "(i) The incident of the 15th January, 1988 in , regarding apprehension of a lawyer by the police. ", "(ii) The incident and reported lathi- charge on the 21st January, 1988 outside the office of , Delhi. ", "30 ", "(iii) Circumstances leading to presence of a mob in Tis Hazari premises on 17th Febru- ary, 1988 and the resultant violence. ", "(iv) Any other incidental development connected with the above. ", "The is requested to ascertain the facts leading to the aforesaid incidents with a view to identifying those responsible for the incidents so that stringent action could be taken against all those responsible. The may, if it deems appro- priate, submit an interim report within seven days of its first sitting suggesting action if any, against police officials or any other involved persons pending submission of the final report within a period of 3 months.\" ", "Subsequently in pursuance of a direction issued by this Court the aforesaid notification was modified by the Admin- istrator vide Notification dated 15th March, 1988 by direct- ing that the provisions of Sections 4 , 5 , 5-A , 6 , 8 , 8-A , 8-B . 8-C, 9, 10 and 10- A of the Commissions of Inquiry Act , 1952 and the rules made under Section 12 thereof shall apply to the said Committee. ", "The submitted an interim report on 9th April, 1988 and during the course of proceedings before it thereaf- ter passed the aforesaid orders which are the subject matter of these writ petitions and special leave petitions. After having heard learned counsel for the parties at length we passed an order on 18th August, 1988 which we consider it appropriate to reproduce here with a view to avoiding the repetition of the reasons already given therein in support of the said order: ", "\"It is unfortunate that this case has arisen between lawyers and police who are both guardians of law and who constitute two important segments of society on whom the stability of the country depends. It is hoped that cordiality between the two sections will be restored soon. ", "In order to avoid any further delay in the proceed- ings before the Committee consisting of and , JJ, constituted by Order dated 23rd February, 1988 to enquire into certain incidents which took place on the 15th January, 1988. 2 1st January, 1988 and 17th February, 1988, we pass the following order now but we shall give detailed reasons in support of this order in due course. ", "The order is as under: ", "1. This order is passed on the basis of the material available on record, the various steps already taken before the and other peculiar features to the case. ", "2. has to examine first all its witnesses as required by Rule 5(5)(a) of the Commissions of Inquiry (Central) Rules, 1972 (hereinafter referred to as the Rules) framed under the Commissions of Inquiry Act , 1952 (hereinafter referred to as the Act). Even those witnesses who may have filed affidavits already may first be examined-in-chief before they are cross-examined, since it is stated that when the affidavits were filed the deponents did not know what the other parties who have also filed affidavits had stated in their affidavits. The question whether a party has the right of crossexamination or not shall be decided by the in accordance with Section 8-C of the Act. In the facts and circumstances of the case to which reference will be made hereafter this direction issued to to examine its witnesses first as provided by rule 5(5)(a) of the Rules referred to above does not apply to those witnesses falling under sec- tion 8-B of the Act, who have to be examined at the end of the inquiry as opined by the itself. ", "3. We have gone through the several affidavits and other material placed before the and also the Interim Report dated April 9, 1988 passed by the . In para 13 of the Interim Report the has observed thus: ", "During the course of the inquiry, we have to examine the conduct of various police officers and others and particu- larly, as the record shows, of the DCP (North), (North), SHO, PS (Badli) and SI Incharge Police Post, and SI. (Badli). ", "In para 14 of the Interim Report it is observed. ", "32 ", "Lawyers have seriously urged that this Committee should send a report recommending suspension of the DCP (North) Ms . ", "Ultimately the recommended the transfer of the petitioners in these cases, namely, Ms , DCP (North) and SI, , Tis Hazari. ", "Section 8-B of the Act reads: ", "\"8-B. If, at any stage of the inquiry, the , ", "(a) considers it necessary to inquire into the conduct of any person; or ", "(b) is of opinion that the reputation of any person is likely to be prejudicially affected by the inquiry, the Commission shall give to that person a reasonable opportunity of being heard in the inquiry and to produce evidence in his de- ", "fence: ", "Provided that nothing in this section shall apply where the credit of a witness is being impeached.\" ", "In its Interim Report the Committee has unequivocally observed that it had to examine the conduct of various police officers, and in particular among others Ms , DCP (North) and , SI, , Tis Hazari. ", "Having given our anxious consideration to all the as- pects of the case we hold that the petitioners Ms and are persons who fall under Section 8-B of the Act and have to be dealt with accordingly. ", "4. According to the 's own opinion formed in the light of the facts and circumstances of the case, all these persons to whom notices under Section 8-B of the Act are issued have to be examined at the end of the inquiry. This is obvious from the order of the passed on June 29, 1988 after it was asked by this Court by its order dated June 2, 1988 to reconsider the whole question relating to the order in which the witnesses had to be examined in the case. In its order dated June 29, 1988 the has observed thus: ", "33 ", "\"Without going into the controversy if Rule 5(5) is an independent rule or is governed by Sections 8-B and 8-C of the Act, we would direct that in the circumstances of the case three persons namely, the Additional Commis- sioner of Police (Special Branch), DCP (Traf- fic) and Mr. , SI to whom notices under Section 8-B of the Act have been issued be examined at the end of the inquiry.\" ", "If three persons referred to above to whom notices under Section 8-B have been issued are to be examined even accord- ing to the at the end of the inquiry there is no justifiable reason to deny the same treatment to the peti- tioners Ms and who are in the same position as those three persons. The action of the in asking them to be cross-examined at the beginning of the inquiry appears to us to be discriminatory. Mere non-issue of notices to them under Section 8-B ought not to make any difference if they otherwise satisfy the conditions men- tioned in Section 8-B . The issue of such a notice is not contemplated under Section 8-B of the Act. It is enough if at any stage the considers it necessary to in- quire into the conduct of any person. Such person would thereafter be governed by Section 8-B of the Act. The Com- mittee should have considered whether the petitioners were entitled to be treated as persons governed by Section 8-B of the Act before asking them to get into the witness box for being cross-examined. If the had found that the petitioners were covered under Section 8-B , then perhaps they would not have been asked to get into the witness box for being cross-examined till the end of the inquiry. The would have then asked them to give evidence along with others who were similarly placed at the end of the inquiry. ", "On behalf of both the petitioners it is submitted that they did not either wish to delay the proceedings or to show disrespect to the but only wanted to protect their own interest by making the submission which they made before the as per legal advice given to them. This is not a case where the circumstances in which the several incidents that had taken place were not known to anybody else. The affidavits and other material before the show that there were a large number of persons who were eye-witnesses to the incidents and who could give evidence before the . ", "Taking into consideration all the aspects of the case we feel that the should not have in the circumstances of the case directed the filing of a complaint against either of the petitioners for an offence punishable under Section 178 . ", "In view of the foregoing we feel that the orders of the directing the filing of the complaints and the criminal proceedings initiated against the petitioners before the Metropolitan Magistrate pursuant to the com- plaints filed on behalf of the should be quashed and we accordingly quash the said orders of the and also the criminal proceedings. ", "A judgment containing the reasons for this order will fol- low. ", "Before concluding this order we record the statement made by , learned Additional Solicitor General appearing for that and its police officers will fully cooperate with the so that the may complete its work as early as possible. We also record the statement made by , learned Additional Solicitor General that he and his clients, the petitioners in this case hold the in great respect and that they never intended to show any kind of discourtesy to the . He also expresses apology for using one or two strong words against the in the course of the arguments in this Court. ", "We now proceed to give our detailed reasons in support of the aforesaid order: ", "We find it necessary to refer to some of the regulations framed by the to regulate its procedure. We also find it necessary to indicate the nature of the orders which have been challenged in these writ petitions and special leave petitions. It also seems appropriate at this very place to refer to the order of this passed in these proceedings on 2nd June 1988 and the order of the passed on 29th June, 1988 in pursuance of the order of this dated 2nd June 1988. As is apparent from a copy of the regulations filed in these proceedings, the framed \"Regulations of procedure under Section 8 of the Commissions of Enquiry Act, 1952 to be followed by the of Inquiry\". Regulations 8, 11, 14, 18, and 21 which in our opinion appear to be relevant for purposes of these cases are reproduced as hereunder: ", "\"8. To avoid its proceedings being unduly prolonged and protracted, the Committee may divide and group together the various persons, Associations and departments before it in such manner as it thinks just and proper for the purposes of producing oral evidence, cross-examination of witnesses examined before it, and for address- ing arguments. ", "Provided, however, any person who is likely to be prejudicially affected as provid- ed in Sec. 8-B of the Act shall be entitled to appear personally or through an authorised agent, and to produce evidence in his or her defence. ", "11. The witness whose evidence is recorded by the orally on oath will be allowed to be cross-examined by the concerned parties in accordance with the provisions of the Act. ", "14. The affidavit or statement of case filed by any deponent can be treated as his examina- tion-in-chief. ", "18. Technical rules of the Evidence Act , as such, shall not govern the recording and admissibility of evidence before the Commit- tee. However, the principles of natural jus- tice and fair play shall be followed. ", "21. The reserves the right to alter, modify, delete or add to any of these regula- tions of procedure at any time during the inquiry, as and when it considers necessary.\" In pursuance of a notice issued by the under Rule 5(2)(a) of the Rules, statements of case inter alia on behalf of and which were accompanied by affidavits in support of the facts set out in the respective statements of case were filed before the . On 8th April, 1988, the parties and their counsel stated that they would need two weeks' time to file counter affidavit and list of wit- nesses to be examined by them. The time prayed for was granted. The proceedings on that date were adjourned to 22nd April, 1988. On that date an application was made on behalf of the Commissioner of Police and other police officers for extension of time to file counter affidavit which was ex- tended till 13th May, 1988. The following order, how- ", "36 ", "ever, was simultaneously passed on that date. \"Mr. has been told to keep. his witnesses ready for being examined from 16th May, 1988. The Committee proposes to hold the sitting from day-today w.e.f. 16th May, 1988. For further proceedings and recording of evidence to come up on 16th May, 1988.\" Here it may be pointed out that Mr. was the counsel appearing for and the effect of the order aforesaid was that was required to keep its witnesses ready for being examined from 16th May, 1988. On 16th May time till 5.00 P.M. to all concerned to file their counter affidavits along with the list of witnesses was granted and further proceedings were adjourned for the next day. On 17th May, 1988, two applications were made on behalf of the Commis- sioner of Police; one for postponement of heating and the other for calling upon to start their evidence and to call upon the Commissioner of Police to adduce his evidence thereafter. The counter affidavit and the list of witnesses on behalf of the Commissioner of Police had not been filed even till 17th May, 1988. The Committee dismissed both the applications referred to above and passed an order saying that since the Commissioner of Police has failed to file the counter affidavit or the list of witnesses, Mr. , S.I., and Mrs. , the then D.C.P. (North) be present in on 19.5.88 at 10.30 A.M. for being cross-examined. On 19th May, 1988, counsel for was directed to produce Mr. , S.I., in the witness box for being cross-examined. On being informed by counsel for that Mr. was not available, bailable warrant was ordered by the Committee to be issued for production of Mr. at 10.30 A.M. on 23rd May, 1988. Thereafter Smt. who was present in was directed to come in the witness box for cross-examination. The relevant portion of the order passed thereafter on 19th May, 1988 reads as hereunder: ", "\"Mrs. has been asked to take oath, but she has refused to do so. At this stage, we called upon Mr. , Counsel appear- ing for Delhi as also Mr. , Counsel appearing for Mrs. Kiran to justify the action of the witness in not taking the .oath. We call upon the counsel to address because according to us prima facie offence is made out under Section 178 I.P.C. Mr. relies on the judgment of this in Smt. and Anr. v. Mr. , Commission of Inquiry, ILR 1980(1) Delhi 5522. We have been taken through certain passages of judgment and we find that the facts of case are entirely different inasmuch as no affidavit had been filed by Smt. in that case and she had been summoned merely under Section 8-B of the Commission of Enquiry Act. In the present case, an affidavit of Mrs. Kiran is on record. She had to be given further opportunity to make any further statement and her affidavit already filed has to be justified by cross-examination. Let notice issue to Mrs. Kiran to show cause why she should not be prosecuted under section 178 I.P.C. Since she is present, she is accepting this notice. The notice is returnable for tomorrow, the 20th May, 1988. Ordinarily directions have to be issued to her to be present in court, but Mr. undertakes that she will be present in tomorrow and as such no further directions are necessary.\" ", "On 20th May, 1988 as the order sheet of that date indi- ", "cates counter affidavit along with list of witnesses was filed on behalf of the Commissioner of Police and both were taken on record. With regard to the notice issued to Smt. on 19th May, 1988, the following order was passed: ", "\"By our order dated 19.5.88, we had issued a notice to Mrs. to show cause as to why she should not be prosecuted under Section 178 of the I.P.C. for refusing to take oath in the witness box. Notice was made returnable for today. ", "Mr. who appears for Mrs. has refused to show any cause on the ground that notice was too short. We have heard the arguments of Mr. on behalf of . ", "For orders to come up on 23rd May, 1988. Mrs. who is present today is directed to be present in the Court on 23.5.88 at 10.30 A.M.\" ", "38 ", "On 23rd May, 1988, the held that refusal of Smt. in not testifying on oath before was wholly unjustified and proceeded to file a complaint for an offence under section 178 of the Indian Penal Code. As regards Mr. , it seems that he could not be required to appear in the witness box on 23rd, 24th or 25th May, 1988. On 26th May, 1988 the following order was passed: \"Mr. was directed to come into the witness box. When asked by us to bind himself on oath or affirmation to state the truth, the witness refused to do so. Earlier we had authorised the court master to administer him the oath. But, as we have already said, the witness refused to take the oath. The witness states that he is willing to make a statement without oath and would be prepared to answer all the questions in cross-examination. When asked if he is aware of the fact that his action in not taking the oath is punishable under Section 178 of the Indian Penal Code, he says he has nothing further to state. On consideration the is of the opinion that since this witness has already filed an affidavit which is a statement on oath, it is not possible to record any further statement or crossex- amine without oath. Mr. , however, states that he is not prepared to take the oath because he is in the nature of an accused and he cannot be asked to start the evidence and would be prepared to come in the witness box after the evidence of other party is recorded. ", "Mr. at present S.I. at Police Post, Railway Station, Subzi Mandi, Delhi, who was S.I. in charge , Delhi during January and February, 1988, was summoned as a witness and was asked to step into the witness box. His statement was to be recorded on oath for the purpose of cross-examination. He, however, refused to bind himself by an oath or affirmation to state the truth when required so to bind himself by the . The con- siders that Mr. who was at the relevant time S.I. in charge at , Delhi, where the incidents took place is a very material witness and his case is identical to the case of Ms. . For the reasons recorded in our order dated 23rd May, 1988 regarding Ms. , we proceed to file a complaint for an offence under section 178 of the Indian Penal Code.\" ", "39 ", "In pursuance of the orders dated 23rd May and 26th May, 1988 complaints were filed by , Delhi, for an offence under section 178 of the Indian Penal Code and as is appar- ent from a copy of one of the complaints produced before us these complaints have been filed under sub- section 4 of section 5 of the Commissions of Inquiry Act, 1952 read with section 346 of the Code of Criminal Procedure, 1973. As already indicated, it is the aforesaid orders dated 17th, 20th, 23rd and 26th May, 1988 which have been challenged in these writ petitions and special leave petitions. These writ petitions and special leave petitions first came up for consideration' before who was functioning as the Vacation Judge. After hearing the parties he passed an order on 2nd June, 1988. The relevant portion of the order which was passed by this Court on 2nd June, 1988 in these proceedings, reads as hereunder: ", "\"Learned counsel for the parties agree that the respondent should be directed to re-examine the order and sequence in which parties witnesses as well as the witnesses summoned by the should be examined with reference to the incidents mentioned in the Notification dated 23rd February, 1988. The is accordingly directed to consider afresh the order in which the parties witnesses as well as witnesses summoned by the on its own are to be examined with reference to the incidents mentioned in the Notification appointing the after hearing counsel for the parties. The is further directed to consider the question as to the stage when main witnesses on behalf of the respective parties should be examined. The will pass a reasoned order after hearing the parties. Parties agree that these questions should be considered by the Commit- tee on 20th June, 1988 or any subsequent date subject to its convenience.\" ", "In pursuance of the aforesaid order, the after hearing learned counsel for the parties passed an order on 29th June, 1988. It inter alia took the view that the con- cept of burden of proof did not appear to be quite relevant in the proceedings before a Commission under the Act which had been given free hand to lay down its own procedure subject, of course, to the provisions of the Act and the rules made thereunder. It also held that it would be diffi- cult for the committee to lay down the manner in which the witnesses are to be examined foregoing its right to examine any witness at any stage if his statement appeared to be relevant. One of the submissions made by learned counsel for the Commissioner of Police was that since serious accusations have been made by the lawyers against Smt. and the police with regard to the incidents dated 21st January and 17th February, 1988, the lawyers should be first called upon to lead evidence to substantiate their allegations and the police personnel may be required to lead evidence only in rebuttal. This submission, however, did not find favour with the . It took the view that the whole stress of learned counsel seemed to be on burden of proof and was based on certain misconceptions. Likewise, the argument that Smt. and also fell within the pur- view of Section 8-B of the Act did not find favour with the . In this connection, it was pointed out that except for the three officers namely, the Addl. Commissioner of Police (Special Branch), New Delhi, D.C.P. (Traffic) and Mr. , S.I., Police Station, Samepur (Badli), to no other officer notice under section 8-B of the Act had been issued and that merely because there were allegations against a particular person he could not be said to be covered under Section 8-B which required a positive order from the . It was also pointed out that a person has to be put on guard by the if it considers it necessary to inquire into his conduct or the is of the opinion that the reputation of that person is likely to be prejudicially affected by the inquiry. When its attention was invited to the interim report where the had mentioned that conduct of various police officers particu- larly of the D.C.P. (North), Addl. D.C.P. (North) S.H.O., Badli) and S.I. Incharge Police Post, Tis Hazari and S.I., Samaypur (Badli), was to be examined and it was submitted that consequently they were covered under section 8-B , the took the view that the submission was misplaced inasmuch as when the mentioned that it was to examine the conduct of various police officers and others, it did not have in view section 8-B of the Act. According to the the plea that Section 8-B was attracted appeared to be an afterthought. With regard to the three persons mentioned above to whom notices under section 8-B of the Act had been issued, the specifically held that those persons would be examined at the end of the inquiry. The emphasised on the circumstance that in the inquiry before it there was no \"Lis\" as is commonly understood while trying a criminal or civil case and that principle of burden of proof had no relevance. ", "41 ", "These cases were then posted before this Bench for hearing. On the respective submissions made by learned counsel for the parties, the following points, in our opin- ion, arise for consideration: ", "(i) whether the procedure adopted by the Committee with regard to the sequence in which witnesses were to be examined was legal? ", "(ii) Whether Smt. and , the two petitioners, fell within the category of persons contemplated by Section 8-B of the Act and were consequently entitled to the same treatment as was accorded by the to the persons to whom notice had been issued by it under the said Section? ", "(iii) whether the was justified in calling upon the two petitioners to stand in the witness box for crossexamination almost at the very initial stage of the inquiry? ", "(iv) whether the orders of the directing prosecution of the two petitioners under Section 178 are legal? ", "(v) whether an appeal is maintainable against filing of complaint, the same being an administrative Act? ", "(vi) whether a challenge to the filing of the complaint is infructuous inasmuch as the order issuing summons to the petitioners passed by the Magistrate upon the complaints filed against them had not been challenged? ", "(vii) whether it is a fit case for inter- ference by this at this stage with the filing of complaint, it being open to the petitioners to prove themselves to be innocent before the magistrate? ", "With regard to point No. (i), we are of the opinion that apart from the directions contained in paragraph 4 of our order dated 18th August, 1988 regarding the stage at which persons failing under Section 8B of the Act were to be examined and also what has been observed in paragraph 2 of the said order, we do not find it expedient to lay down any particular rigid procedure to be followed by the with regard to sequence in which witnesses were to be exam- ined by it. ", "42 ", "Consequently, we find it unnecessary to consider in any further detail, the submissions made by counsel for the parties on this point. In so far as point No. (ii) is con- cerned, it would be seen that the use of the word 'or' between clauses (a) and (b) of Section 8B of the Act makes it clear that Section 8B would be attracted if requirement of either clause (a) or clause (b) is fulfilled. Clause (a) of Section 8B applies when the conduct of any person is to be enquired into whereas Clause (b) applies to a case where reputation of a person is likely to be prejudicially affect- ed. As regards the enquiry about the conduct of Smt. and , even the in its interim report specifically stated that the conduct of these two petitioners among others was to be examined. Having once so stated in unequivocal terms, it was not open to the Commit- tee to still take the stand that Section 8B was not attract- ed in so far as they were concerned. Recourse to procedure under Section 8-B is not confined to any particular stage and if not earlier, at any rate, as soon as the made the aforesaid unequivocal declaration of its intention in its interim report, it should have issued notice under section 8-B to the two petitioners, if it was of the view as it seems to be, for which view there is apparently no justi- fication, that issue of a formal notice under section 8-B was the sine-qua-non for attracting that Section. At all events, the could not deny the petitioners the statutory protection of Section 8-B by merely refraining from issuing a formal notice even though on its own declared intention the section was clearly attracted. , Suppl. S.C.R. page 401, while dealing with Section 10 of the Jammu and Kashmir of Enquiry Act, 1962, which seems to be an amalgam of Section 8-B and 8-C of the s of Enquiry Act, 1952 and repelling the argument that section 10 applied only when the conduct of a person came to be enquired into incidentally and not when the had been set up to enquire directly into the conduct of a person, it was held: ", "\"If a is set up to inquire directly into the conduct of a person, the must find it necessary to inquire into that conduct and such a person would, therefore, be one covered by s. 10 . It would be strange indeed if the Act provided for fights of a person whose conduct incidentally came to be enquired into but did not do so in the case of persons whose conduct has directly to be in quired into under the order setting up the . It would be equally strange if the Act contemplated the conduct of a person being inquired into inci- dentally and not directly. What can be done indirectly should obviously have been consid- ered capable of being done directly.\" ", " , , 2 S.C.R., page 1, with reference to Section 8-B of the Act, it was held at page 108 of the report that it was undeniable that the person whose conduct was being enquired into was exposed to the fierce light of publicity. Keeping in view the nature of the allegations made in the statements of case and the supporting affidavits filed on behalf of the various including the requirement of even Clause ", "(b) of Section 8-B was filfilled inasmuch as if those alle- gations were proved they were likely to prejudicially affect the reputation of the two petitioners. Indeed, in view of the term of reference which contemplated taking of \"strin- gent action\" against all those responsible, even the career of the petitioners as Police officers was likely to be affected in case an adverse finding was recorded against them. In view of the aforesaid specific term of reference, the principle that the report of has no force proprio vigore does not on a pragmatic approach to the consequences seem to constitute sufficient safeguard so far as the petitioners are concerned. ", "The reason for the importance attached with regard to the matter of safeguarding the reputation of a person being prejudicially affected in Clause (b) of Section 8-B of the Act is not far to seek. ", "The following words of caution uttered by the Lord to Arjun in Bhagwad Gita with regard to dishonour or loss of reputation may usefully be quoted: ", "\"Akirtinchapi Bhutani Kathaishyanti te-a-vyayam, Sambhavitasya Chakirtir mara- nadatirichyate.\" (234) (Men will recount thy perpetual dishonour, and to one highly es- teemed, dishonour exceedeth death. ) In 's commentary of the laws of England, Vol- I, IVth Edition, it has been stated at page 101 that the right of personal security consists in a person's legal and uninterrupted enjoyment of his life, his limbs, his body, his health and his reputation. ", "44 ", "In Corpus Juris Secundum, Vol. 77 at page 268 is to be found the statement of law in the following terms: ", "\"It is stated in the definition Person, 70 C.J.S.p. 688 note 66 that legally the term \"person\" includes not only the physical body and members, but also every bodily sense and personal attribute, among which is the reputa- tion a man has acquired. in his Commentaries classifies and distinguishes those fights which are annexed to the person, jura personarum, and acquired fights in exter- nal objects, jura rerum; and in the former he includes personal security, which consists in a person's legal and uninterrupted enjoyment of his life, his limbs, his body, his health, and his reputation. And he makes the corre- sponding classification of remedies. The idea expressed is that a man's reputation is a part of himself, as his body and limbs are, and reputation is a sort of fight to enjoy the goods opinion of others, and it is capable of growth and real existence, as an arm or leg. Reputation is, therefore, a personal fight, and the right to reputation is put among those absolute personal fights equal in dignity and importance to security from violence. Accord- ing to Chancellor , \"as a part of the rights of personal security, the preservation of every person's good name from the vile arts of detraction is justly included. The laws of the ancients, no less than those of modern nations, made private reputation one of the objects of their protection. ", "The fight to the enjoyment of a good reputation is a valuable privilege, of ancient origin, and necessary to human society, as stated in Libel and Slander S. 4 , and this fight is within the constitutional guaranty of personal security as stated in Constitutional La S. 205 , and a person may not be deprived of this fight through falsehood and violence without liability for the injury as stated in Libel and Slander S. 4 . ", "Detraction from a man's reputation is an injury to his personality, and thus an injury to reputation is a personal injury, that is, an injury to an absolute personal right.\" ", "In D.F. Marion v. Davis, 55 American Law Reports, page 171, it was held: ", "45 ", "\"The right to the enjoyment of a private reputation, unassailed by malicious slander is of ancient origin, and is necessary to human society. A good reputation is an element of personal security, and is protected by the Constitution equally with the right to the enjoyment of life, liberty, and property.\" ", "In view of the foregoing discussion and the reasons already stated in our order dated 18th August 1988, we are of the view that the two petitioners namely, Smt. and clearly fell within the category of persons contemplated by section 8-B of the Act and were consequently entitled to the same treatment as has been accorded by the to the persons to whom notice has been issued by it under the said section. As a consequence, we are further of the opinion that our answer to point No. (iii) has to be that the was not justified in calling upon the two petitioners to stand in the witness box for cross-examina- tion at the very initial stage of the enquiry. In this connection, it has to be borne in mind that Section 8-B inter alia contemplates an opportunity being given to the person governed by the said section to produce evidence in his defence whereas Section 8-C inter alia gives him the right to cross-examine the witnesses who depose against him. Not only that calling upon a person governed by Section 8-B to produce evidence in his defence at the very inception of the inquiry is a contradiction in terms inasmuch as in this situation such a person would really be required to disprove statements prejudicial to him of such witnesses who are yet to be examined, it would also reduce the right of cross- examination by such person to a mere formality for the obvious reason that by the time the witnesses who are to be cross-examined are produced, the defence of such person which would normally constitute the basis for the line and object of crossexamination would already be known to such witnesses and they are likely to refashion their statements accordingly. ", "Perhaps in a case where there is no other witness to give information about the alleged incident about which the inquiry is being held and the only person or persons who would give such information is or are the person or persons who are likely to be adversely affected by the inquiry, it may be necessary to depart from the above view as a matter of necessity. But this is not one such case. There are admittedly any number of other persons who can give evidence about what happened on the relevant dates. Learned counsel for the various who shall hereinafter be referred to as learned counsel for the re- spondent expressed an apprehension that in case a person governed by Section 8-B was to be examined at the end and at that stage such person even at the risk of not producing his defence, for some reason, chooses not to appear as a wit- ness, the Committee would be deprived of knowing the facts in the knowledge of such person and such a course would obviously hamper the enquiry. To us this apprehension seems to be more imaginary than real inasmuch as the power of the to call upon any person to appear as a witness under Section 4 of the Act which in terms is very wide and is not circumscribed by fetters of stage, will be available to the and the would be entitled to call such person as a witness even at that stage. Before parting with these points we may point out that learned counsel for the respondent cited several authorities in support of the principle that the report of a of Inquiry which was only a fact finding body did not have force proprio vigore and was only recommendatory in nature. Since the principle is well-settled we have not considered it necessary to deal with those authorities. Likewise some cases were cited with regard to claim of privilege by a witness. Since the petitioners are not claiming any privi- lege but are only claiming to be treated in a reasonable way as persons governed by Section 8-B of the Act and to be meted out the same treatment which has been given to persons falling in that category, those cases also are not necessary to be dealt with. ", "Now we come to the fourth point namely whether the orders of the directing prosecution of the peti- tioners under Section 178 I.P.C are legal. In order to appreciate the respective submissions of the learned counsel for the parties on this point it will be useful to reproduce here Sections 178 and 179 I.P.C They read: ", "\"178. Refusing oath or affirmation when duly required by public servant to make it.--Whoev- er refuses to bind himself by an oath or affirmation to state the truth, when required so to bind himself by a public servant legally competent to require that he shall so bind himself, shall be punished with simple impris- onment for a term which may extend to six months, or with fine which may extend to one thousand rupees, or with both. ", "179. Refusing to answer public serv- ant authorised to question. Whoever, being legally bound to state the truth on any subject to any public servant, refuses to answer any question demanded of him touch- ing that subject by such public servant in the exercise of the legal powers of such public servant, shall be punished with simple impris- onment for a term which may extend to six months, or with fine which may extend to one thousand rupees, or with both.\" ", "The had in the instant case directed a com- ", "plaint to be filed against each of the petitioners for an offence punishable under Section 178 I.P.C. and subsequently filed complaints accordingly. The charge against the peti- tioners, therefore, was of refusal to bind themselves by an oath or affirmation to state the truth on being called upon to do so. Section 179 I.P.C. in the context becomes relevant in so far as it deals with the consequences of refusal by the person concerned to answer questions demanded of him touching that subject with regard to which such person had bound himself to state the truth under Section 178 . The context in which the two petitioners were required to bind themselves by an oath or affirmation to state the truth was to face cross-examination. The petitioners were obviously placed on the horns of a dilemma. If they refused to bind themselves by an oath or affirmation to state the truth they became liable to be punished with simple imprisonment for a term which may extend to six months or with fine which may extend to one thousand rupees or with both. If on the other hand they had to bound themselves and thereafter refused to answer any question as contemplated by Section 179 they would have again become vulnerable to identical punishment. The problem in the aforesaid background presents two propositions: (1) whether on the belief that they were persons covered by Section 8-B of the Act the petitioners could avoid the consequences of Sections 178 and 179 I.P.C by claiming absolute immunity from binding themselves by an oath or affirmation for answering questions put to them and (2) whether they could avoid those consequences if they had valid justification for refusing to take oath or affirmation without claiming an absolute immunity from binding them- selves by an oath or affirmation. The answer to the first proposition, in our opinion, has to be in the negative whereas of the second in the affirmative. Our reasons for this conclusion are these: ", "In v. , 71 L.ed. 580 one of the ques- tions which arose for consideration was whether the --or , both being on the same plane in this regard--has power, through its own process, to compel a private individ- ual to appear before it or one of its committees and give testimony needed to enable it efficiently to exercise a legislative function belonging to it under the Constitution. It was held that the power of inquiry--with process to enforce it--is an essential and appropriate auxiliary to the legislative function and that the provisions in this behalf are not of doubtful meaning, but \"are intended to be effec- tively exercised, and therefore to carry with them such auxiliary powers as are necessary and appropriate to that end. While the power to exact information in aid of the legislative function was not involved in those cases, the rule of interpretation applied there is applicable here. A legislative body cannot legislate wisely or effectively in the absence of information respecting the conditions which the legislation is intended to affect or change; and where the legislative body does not itself possess the requisite information--which not infrequently is true--recourse must be had to others who do possess it. Experience has taught that mere requests for such information often are unavail- ing, and also that information which is volunteered is not always accurate or complete; so some means of compulsion are essential to obtain what is needed. All this was true before and when the Constitution was framed and adopted. In that period the power of inquiry--with enforcing process--was regarded and employed as a necessary and appropriate at- tribute of the power to legislate--indeed, was treated as inhering in it. Thus there is ample warrant for thinking, as we do, that the constitutional provisions which commit the legislative function to the two houses are intended to include this attribute to the end that the function may be effectively exercised.\" ", "On these findings, with regard to refusal by the witness to appear and testify before the and being at- tached as a consequence thereof, it was held: ", "\"We conclude that the investigation was or- dered for a legitimate object; that the wit- ness wrongfully refused to appear and testify before the and was lawfully at- tached; that the is entitled to have him give testimony pertinent to the inquiry, either at its bar or before the committee; and that the district court erred in discharging him from custody under the attachment.\" ", "In v. (3 L.ed 2d 1090) a witness at an investigation by the Attorney General of the of New Hampshire, conducted pursuant to a resolution of the legislature authorizing the Attorney General to determine whether there were subversives within the state, refused to obey a subpoena calling for the production of a list of persons who were guests at a camp operated within New Hampshire by a voluntary corporation of which the witness was executive director. On petition of the Attorney General, called the witness before it and the witness again refused to produce the information, asserting, first, that, by the Smith Act (18 USC s. 2385 ), had so completely occupied the field of subversive activities that the states were without power to investigate in that area, and, second, that the due process clause precluded enforcement of the subpoena. The court rejected the witness' argument, and, upon his contin- ued refusal to produce the list, adjudged him in contempt and committed him to jail until he should comply. of New Hampshire affirmed, and even after remand by it reaffirmed its former decision. On appeal, while affirming the decision of held that since the Attorney General sought to learn if subversive persons were in the because of the legislative determination that such persons, statutorily defined with a view toward , posed a serious threat to the security of the , the investiga- tion was undertaken in the interest of self-preservation and this governmental interest outweighed individual rights in an associational privacy which, however, real in other circumstances were here tenuous at best. It was further held that \"the governmental interest in self-preservation is sufficiently compelling to subordinate the interest in associational privacy of persons who, at least to the extent of the guest registration statute, made public at the incep- tion the association they now wish to keep private. In the light of such a record we conclude that the 's interest has not been \"pressed, in this instance, to a point where it has come into fatal collision with the overriding\" constitu- tionally protected rights of appellant and those he may represent.\" ", "In v. United States, (73 L.ed. 692 it was held: ", "\"Neither Joint Resolution 54 nor the action taken under it operated to divest the or the committee of power further to investigate the actual administration of the land laws. It may be conceded that is without authority to compel disclosures for the purpose of aiding the prosecution of pending suits; but the authority of that body, directly or through its committees, to require pertinent disclosures in aid of its own con- stitutional power, is not abridged because the information sought to be elicited may also be of use in such suits.\" ", "In v. United States, (32 LEd 2d 2 12) ' ordered the petitioners to appear before a grand jury and to answer its questions under a grant of immunity. The immunity was based upon a provision of the Organized Crime Control Act of 1970 stating that neither the compelled testimony nor any information directly or indirectly derived from such testimony could be used against the witness. Notwithstanding the grant of immunity, the petitioners refused to answer the grand jury's questions and were found in contempt. for affirmed (440 F2d 954), rejecting the peti- tioners' contention that it violated their constitutional privilege against self-incrimination to compel them to testify without granting them transactional immunity from prosecution for any offence to which the compelled testimony might relate. ", "On certiorari, affirmed. It held that the power of government to compel persons to testify in court or before grand juries and other governmen- tal agencies was firmly established but was not absolute, being subject to a number of exemptions, the most important of which was the Fifth Amendment privilege against self- incrimination. With reference to Federal Statute (18 USCS s. 6002 ) it was held: ", "\"That a federal statute permitting the govern- ment to compel a witness to give testimony, but granting the witness immunity from the use in any criminal case of the compelled testimo- ny or any evidence derived therefrom, does not violate the Fifth Amendment privilege against self-incrimination.\" ", "In v. , (40 L.ed. 819) the question involved was with regard to an alleged incompatibility between that clause of the 5th Amendment to the Constitution, which declares that no person \"shall be compelled in any criminal case to be a witness against himself\" and the act of Con- gress of February 11, 1983 (27 Stat. at L. 443), which enacts that\" no person shall be excused from attending and testifying or from producing books, papers, tariffs, con- tracts, agreements and documents before , or in obedience to the subpoena of the , ...... on the ground or for the reason that the testimony or evidence, documentary or otherwise, required of him, may tend to criminate him or subject him to a penalty or forfeiture. But no person shall be prosecuted or subjected to any penalty or forfeiture for or on account of any transaction, matter, or thing concern- ing which he may testify, or produce evidence, documentary or otherwise, before said , or in obedience to its subpoena, or either of them, or in any such case or proceed- ing.\" It was held: ", "\"it is entirely true that the statute does not purport, nor is it possible for any statute, to shield the witness from the personal dis- grace or opprobrium attaching to the exposure of his crime; but, as we have already ob- served, the authorities are numerous and very nearly uniform to the effect that, if the proposed testimony is material to the issue on trial, the fact that the testimony may tend to degrade the witness in public estimation does not exempt him from the duty of disclosure. A person who commits a criminal act is found to contemplate the consequences of exposure to his good name and reputation, and ought not to call upon the courts to protect that which he has himself esteemed to be of such little value. The safety and welfare of an entire community should not be put into the scale against the reputation of a self-confessed criminal, who ought not, either in justice or in good morals, to refuse to disclose that which may be of great public utility, in order that his neighbors may think well of him. The design of the constitutional privilege is not to aid the witness in vindicating his charac- ter, but to protect him against being com- pelled to furnish evidence to convict him of a criminal charge. If he secure legal immunity from prosecution, the possible impairment of his good name is a penalty which it is reason- able he should be compelled to pay for the common good. If it be once conceded that the fact that his testimony may tend to bring the witness into disrepute, though not to incrimi- nate. him, does not entitle him to the privi- lege of silence, it necessarily follows that if it also tends to incriminate, but at the same time operates as a pardon for the of- fence, the fact that the disgrace remains no more entitles him to immunity in this case than in the other.\" ", "It is in this view of the matter and in view of the provisions contained in Sections 4 to 6 of the Act and the rules framed thereunder that we are of the opinion that the petitioners on the belief that they were persons covered by Section 8B could not avoid the consequences of Sections 178 and 179 by claiming absolute immunity from binding themselves by an oath or affirmation for answering questions put to them. ", "Indeed in the instant case the petitioners are not asserting that they could not be required at all to appear as a witness before the and make statement on oath. As is apparent from our order dated 18th August, 1988 on behalf of both the petitioners it was submitted that they did not either wish to delay the proceedings or to show disrespect to the but only wanted to protect their own interest by making the submission which they made before the as per legal advice given to them. According to learned counsel for the petitioners the legal advice given to the petitioners was that since they were persons covered by Section 8B of the Act they were entitled to produce evidence in defence and could as such be called upon to enter the witness box at the end of the inquiry and could not be required to enter the witness box for cross-examina- tion almost as the first two witnesses before the . According to him the stand taken by the petitioners was that they being covered by Section 8B of the Act their defence would be put to serious jeopardy and will be prejudicially affected if they were required to appear in the witness box for cross-examination at the very inception of the inquiry even before statements of witnesses proving the accusations against the petitioners had been recorded which they were entitled to defend. That this was really the case of the petitioners will be apparent from our discussion a little later. In this background we pass on to the second proposi- tion referred to above namely whether the petitioners could avoid the consequences contemplated by Sections 178 and 179 I.P.C by putting forth valid justification for refusing to bind themselves by oath or affirmation even without claiming an absolute immunity from binding themselves by an oath or affirmation. ", "In v. United States, 1 L.ed. 2d 1273 a union officer, appearing as a witness before a subcommittee of , refused to answer questions as to past membership of certain persons, objecting to the questions on the ground of lack of pertinency to the subject under inquiry by the subcommittee. In a prosecution in for the District of Columbia, he was convicted of violating the statute providing for criminal punishment of witnesses before congressional committees who refuse to answer any question pertinent to the question under inquiry, and the conviction was affirmed by for On certiorari, reversed the conviction. , Chief Justice, speaking for the five members of the , ruled that to support a conviction under a statute a congressional investigating committee must, upon objection of a witness on the grounds of pertinency, state for the record the subject under in- quiry at that time and the manner in which the propounded questions are pertinent thereto. Consequently refusal to answer a question on the ground that it was not pertinent, was found to be a valid justification. ", "In v. United States, 3 L.ed. 2d 183 relying on the decision in (Supra) that the courts must accord to the defendants every right which is guaranteed to defend- ants in all other criminal cases it was held that one of these guarantees is proof beyond a reasonable doubt that the refusal of the witness was deliberate and intentional. This decision is. therefore~ an authority for the proposition that if the refusal of the witness was not deliberate and intentional but was for a valid cause such refusal could not be made the basis for prosecuting the witness. In v. of New York, 12 L.ed. 2d 678 notwithstanding the grant of immunity under the laws of New Jersey and New York, petitioners, as witnesses before the of New York Harbor, refused to answer questions on the ground that the answers might tend to incriminate them under federal law, to which the grant of immunity did not purport to extend. Petitioners were there- upon held in civil and criminal contempt of court. affirmed the civil contempt judgments, holding that a state may constitutionally compel a witness to give testimony which might be used in a federal prosecu- tion against him. On certiorari, vacated the judgment of contempt and remanded the cause to . It was held: ", "\"... We hold the constitutional rule to be that a state witness may not be compelled to give testimony which may be incriminating under federal law unless the compelled testi- mony and its fruits cannot be used in any manner by federal officials in connection with a criminal prosecution against him. We con- clude, moreover, that in order to implement this constitutional rule and accommodate the interests of the and Federal Governments in investigating and prosecuting crime, must be prohibited from making any such use of compelled testimony and its fruits. This exclusionary rule, while permitting the s to secure information necessary for effective law enforcement, leaves the witness and in substantially the same position as if the witness had claimed his privilege in the ab sence of a state grant of immunity. It follows that petitioners here may now be compelled to answer the questions propounded to them. At the time they refused to answer, however, petitioners had a reasonable fear, based on this 's decision in v. United s, supra, that the federal authorities might use the answers against them in connec- tion with a federal prosecution. We have now overruled and held that may make no such use of the an- swers. Fairness dictates that petitioners should now be afforded an opportunity, in light of this development, to answer the questions. Accordingly, the judgment of the New Jersey courts ordering petitioners to answer the questions may remain undisturbed. But the judgment of contempt is vacated and the cause remanded to the New Jersey Supreme for proceedings not inconsistent with this opinion.\" ", "In this case also it is, therefore, clear that a valid justification put forth by the witness was considered to constitute sufficient ground to make him immune from prose- cution. ", "We have already pointed out in our order dated 18th August, 1988 that if the had found that the peti- tioners were covered by Section 8B of the Act it would most probably itself not have required them to get into the witness box for being cross-examined till the end of the inquiry. We have reached this conclusion from the circum- stances that it is the 's own view as expressed in its order dated 29th June, 1988 that persons covered by Section 8B have to be examined at the end of the inquiry. That the case of the petitioners in not taking oath for being cross-examined at the very initial stage was based on Section 8B seems to be apparent. The plea taken in the application made on behalf of the Commissioner of Police on 17th May, 1988 for first calling upon to start their evidence and to call upon the Commissioner of Police to adduce his evidence thereafter was the first indication in this behalf. This plea was, at all events, relevant qua those police officers whose conduct was to be examined. Secondly, when on 19th May, 1988 the learned counsel for Smt. was required to justify her stand of not taking oath, Section 8B was specifically plead- ed and reliance was placed on the decision in the case of Smt. and another v. Mr. Commission of Inquiry, ILR 1980 1 Delhi 552 as is borne out by the order of the of that date. The justification so pleaded was repelled by the on two grounds, namely that Smt. in that inquiry had not filed any affidavit and that she had been summoned under Section 8B . On the view of the expressed in its order dated 29th June, 1988, which will, in the absence of any material to the contrary, be deemed to be its view even on 19th May, 1988, that persons covered by Section 8B were to be examined at the end of the inquiry, the fact that an affidavit of Smt. was on record could hardly justify her being called upon to enter the witness box at the very inception. As regards the second ground we have already held that the fact that no formal notice had been issued under Section 8B would constitute no justification for not treating a person to be covered by that section, if otherwise the ingredients of the said section were made out. ", "As regards the order of the dated 26th May, 1988 quoted earlier indicates that had clearly stated that he is not prepared to take the oath because he is in the nature of an accused and he cannot be asked to start the evidence and would be prepared to come in the witness box after the evidence of other party is record- ed. did not state that he was an accused before the . In saying that he was \"in the nature of\" an accused be obviously meant that since his conduct was to be examined as contemplated by Section 8B he was entitled to appear as a witness in his defence after the witnesses on behalf of which was accusing him had been examined. Had the not been labouring under the misapprehension that the petitioners were not covered by Section 8B , because no notices under that section had been issued to them, notwithstanding the fact that their conduct was to be examined on its own declared intention, it would obviously not have required the petitioners to take oath for being cross-examined at the stage at which it did so. The subsequent orders of the directing complaints to be filed against the petitioners for an offence punishable under Section 178 I.P.C. and the act of filing such com- plaints apparently were the consequences of the aforesaid misapprehension. We have already held that the petitioners were covered by Section 8B of the Act. The action of the in compelling the petitioners to enter the witness box on the dates in question for being cross-examined, when even according to it as is apparent from its order dated 29th June, 1988, persons similarly situated were to do so at the end of the inquiry, was in itself discriminatory. There was, therefore, valid justifi- cation for the refusal by the petitioners to take oath for cross-examination at the stage when they were required to do so. The could have on its own reconsidered the question whether the prosecutions should be pressed further when the case was referred back to it by the learned Vaca- tion Judge of this Court by his order dated 2nd June, 1988. For these reasons and the reasons already given in our order dated 18th August, 1988 we are of the opinion that the should not have in the instant case directed the filing of a complaint against either of the petitioners for an offence punishable under Section 178 I.P.C. We decide point (iv) accordingly. ", "As regards points (v), (vi) and (vii) suffice it to point out that the petitioners have apart from filing spe- cial leave petitions also filed writ petitions challenging the very same orders and since we have held that the action of the in holding that the petitioners were not covered by Section 8B of the Act and compelling them to enter the witness box on the dates in question was discrimi- natory and the orders directing complaint being filed against the petitioners were illegal, it is apparently a case involving infringement of Articles 14 and 21 of the Constitution. In such a situation the power of this Court to pass an appropriate order in exercise of its jurisdiction under Articles 32 and 142 of the Constitution cannot be seriously doubted particularly having regard to the special facts and circumstances of this case. On the orders direct- ing filing of complaints being held to be invalid the conse- quential complaints and the proceedings thereon including the orders of the Magistrate issuing summons cannot survive and it is in this view of the matter that by our order dated 18th August, 1988 we have quashed them. As regards the submission that it was not a fit case for interference either under Article 32 or Article 136 of the Constitution inasmuch as it was still open to the petitioners to prove their innocence before the Magistrate, suffice it to say that in the instant case if the petitioners are compelled to face prosecution in spite of the finding that the orders directing complaint to be filed against them were illegal it would obviously cause prejudice to them.. Points (v), (vi) and (vii) are decided accordingly. ", "These, apart from those stated in our order dated 18th August, 1988 are our reasons for the said order. N.P.V. ", "57"], "relevant_candidates": ["0000184521", "0000894748"]} {"id": "0000227379", "text": [", J. ", "1. The question referred to this Bench for determination is as to whether can interfere in the exercise of its supervisory jurisdictions under Article 227 of the Constitution of India, with the finding of recorded when a dispute, which is the subject matter of a proceeding under Section 145, Cr. cannot be decided by the Magistrate before whom it is pending, and it is referred to a civil Court for a finding. Section 146 of the Code provides that if the Magistrate in such a case is of the opinion that he is unable to decide as to which of the contesting parties was in such possession of the subject of dispute, he may attach it and draw up a statement of the case and forward the record of the proceedings to a civil Court of competent jurisdiction to decide the question whether any and which of the parties was in possession of the subject matter of dispute on the date of the order. Sub-section (1B) of Section 146 provides that at the conclusion of the enquiry the civil Court shall transmit its finding together with the record of the proceedings to the Magistrate by whom the reference was made and the Magistrate shall, on receipt thereof, proceed to dispose of the proceeding under Section 145 in conformity with the decision of . Sub-section (1D) provides that no appeal shall lie from any finding of given on a reference under this section nor shall any review or revision of any such finding be allowed. Sub-section (1E) lays down that an order under this section shall be subject to any subsequent decision of a Court of competent jurisdiction. A decision of of this Court reported in , 1962 BLJR 105: (1962 (2) Cri LJ 577) is to the effect that in view of the provisions of Sub-section (1D) of Section 146, Cr. is not competent to interfere with the finding of returned by it on a reference under Sub-section (1) of this section, but that it is competent to rectify any palpable error under Article 227 of the Constitution of India. ", "2. Accordingly, two questions arise in substance for consideration in the present reference. One is, whether Article 227 of the Constitution can, be applied and that the finding of in the present context can be interfered with by . Article 227 of the Constitution provides that every High Court shall have superintendence over all and tribunals throughout the territory in relation to which it exercises jurisdiction. in the very nature of its constitution is subordinate to and as such is subject to the supervisory jurisdiction of as contemplated under this Article. It is unnecessary to refer in detail to the relevant provisions preceding the incorporation of this Article in the Constitution of India. It is enough to state that the jurisdiction to superintend was conferred upon of the three Presidency towns and the same was also incorporated in Section 9 of the Indian High Act, 1861. When the Government of India Act, 1915, was enacted, Sections 9 and 15 of the Indian High Act, 1861, which together comprised the Superintending jurisdiction of s, came to be replaced by Section 107 of the Government of India Act, 1915. Under Section 224 of the Government of India Act 1935, the power to superintend conferred upon under Section 107 was curtailed to a certain extent so far as the judicial part of it was concerned, inasmuch as Sub-section (2) of Section 224 provided, \"Nothing in this section shall be construed as giving to any jurisdiction to question any judgment of any inferior Court which is not otherwise subject to appeal or revision\". ", "The superintending jurisdiction was both administrative and judicial under the Indian High s Act as also Government of India Act, 1915, but under Section 224 of the Government of India Act, 1935, the, jurisdiction was narrowed down to administrative superintendence. Under Article 227 , however, thought it fit to invest larger power in , so that the position in this respect now is the same as it was under Section 107 of the Government of India Act, 1915, and under Section 15 of the Indian High s Act, 1861. In general terms, no restriction has been placed upon this power of which, is to be exercised in a suitable case; yet it is well settled that, where an appeal is provided, the will not interfere by any peremptory order with the ordinary course of adjudication, save in cases wherein a defeat of law and a grave wrong are manifest and are irremediable by the regular procedure, vide 7 Bom 341 (FB). It has also been laid down in the above decision, in so far as it is relevant that the will, in all cases, regard its exercise of the extraordinary jurisdiction as discretional, and subject to considerations of the importance of particular case. ", "The principle laid down in the above case is that the will sedulously abstain from making any order or refusing to make it on grounds the appreciation of which is exclusively assigned by law to some other authority, provided the legal competence be exercised in good faith on matters that may reasonably be understood as within its lawful range. Their Lordships of the Supreme in the cases of ) AIR 1955 SC 233; , AIR 1958 SC 398 and , AIR 1960 SC 137 have also considered the scope and defined the limits of discretion to be exercised by the High under Articles 226 and 227 of the Constitution. In the following case, they have also held that if another effective remedy be open to the party then exercise of jurisdiction under Article 227 will not be resorted to: , AIR 1961 SC 1506. Similar is the view expressed by the Bombay High in , AIR 1956 Bom 545 and the Calcutta High in , AIR 1952 Cal 526. The principle laid down by the Supreme in the above decisions is that the scope of the power of interference by the High under Article 227 is co-extensive with the exercise of its power under its writ jurisdiction under Article 226 of the Constitution, and the power of interference may extend to quashing an impugned order on the ground apparent on the face of the record; but under Article 227 the power of interference is limited to seeing that the tribunal functions within the limits of its authority. ", "One of the questions mooted in the case of , AIR 1958 SC 398 was whether an interlocutory order passed by could be interfered with by in an appeal against that order, and it was laid down that although, ordinarily, such an order could not be interfered with, yet would interfere with such, an order wheat the features of the case warrant such interference Mr. has referred in particular to the decision in the case of , AIR 1960 SC 137 wherein it has been laid down that however wide may be the powers of under Article 227-- and it is definitely wider than the power under Section 115 of the Code of Civil Procedure it is well established that cannot in the exercise of its powers under that section, assume powers to correct every mistake of law. ", "Where there is no question of assumption of excessive jurisdiction or refusal to exercise jurisdiction or any irregularity or illegality in the procedure or any breach of any rule of natural justice but, if anything, it is merely an erroneous decision which error, not being apparent on the face of the record, it cannot be corrected by in revision under Section 115 of the Code of Civil Procedure or under Article 227 of the Constitution. The conclusion seems to be that , as a rule, will not interfere in the exercise of its superintending jurisdiction with the order of a subordinate Court merely on questions of facts or only because there is failure to consider certain affidavits filed by the parties, if is satisfied that has fairly considered the evidence on record, even if every item of evidence has not been gone into. ", "3. Mr. has urged that If an alternative effective remedy is open, will not exercise its jurisdiction under Article 227 of the Constitution. It is true, no doubt, that in the case of , AIR 1961 SC 1506 and of Bombay in the case of , AIR 1956 Bom 545 and in the case of , AIR 1952 Cal 526 Save laid down that where an alternative remedy 5s open, will, as a rule, not interfere either under Article 226 or 227. That, in fact, is a well known consideration in determining whether should give relief by way of issuing a writ or in its power of superintendence, although the aforesaid decision of makes it clear that it is not an inflexible rule and it is a matter of discretion for to be exercised on a consideration of a variety of individual facts. In the present case, Mr. has referred to Sub-section (1E) of Section 146, Code at Criminal Procedure, which lays down that an order under this section shall be subject to any subsequent decision of a of competent jurisdiction. It is true, no doubt, that an order under this section can be reopened by way of regular suit for declaration of title, but that, in itself, will be hardly a ground for the refusal by to exercise its jurisdiction under Article 227 in a suitable case. If that view were taken, even a judgment containing a flagrant violation of legal principles, or principles of natural justice, would also be upheld, which is putting the matter in the extreme form, and I am not inclined to agree with Mr. in so far as his contention is based on Sub-section (1E) of Section 146. ", "4. Another relevant question, however, for consideration in determining whether will exercise its jurisdiction under Article 227 of the Constitution, in the matter of a finding by , is as to whether the exercise of such jurisdiction will not be superfluous, inconvenient and cumbersome, The view appears to be as expressed in some of the decisions, to which reference has been made by the learned counsel, that Sub-section (1D) bars out any appeal, review or revision of such a finding and as such the only remedy open, to a party must be the procedure provided under Article 227 of the Constitution. It is no doubt, true that Sub-section (1D) in terms refers to this matter specifically, but the point for consideration is whether it amounts to prohibiting an appeal review or revision of such a finding recorded by or it goes beyond it and puts such a finding beyond the power of as well to consider when the matter comes up before it under Sections 435 and 439, Code of Criminal Procedure when such finding has been reserved by the Magistrate and an order has been plained by him in conformity with the decision of . ", "It is, no doubt, true that an opinion has been expressed in some of the decisions that Sub-section (1D) gives finality to the finding of and that it cannot be interfered with either under SECTIONS 435 and 439 or under Article 227 of the Constitution. That was the view expressed by , J. of in , AIR 1960 All 559 and some other decisions, vide , AIR 1959 Mad III: , AIR 1958 Pat 85; , 1962 BLJR 267: (AIR 1962 Pat 468); , AIR 1959 Cal 366 to the effect that is now a competent to interfere in the exercise of its revisional jurisdiction with the finding of as accepted by the Magistrate in any circumstances, howsoever illegal, improper or other-wise incorrect it may be. But the question for decision is whether this Court will follow the opinion expressed by the learned Judges in these cases. ", "It is true, no doubt, that against a finding of , no appeal review or revision will lie under the Code of Civil Procedure inasmuch as , while adjudicating the reference made by tile Magistrate, does not act as independently but only records a finding as a tribunal which in itself will not be operative unless it is adapted by the Magistrate, although the latter is bound to act in conformity with it. It is only when such a finding becomes a part of the order of the Magistrate and is integrated into it that it becomes operative and binding upon the parties. The reference to prohibition of appeal, review or revision of the finding of is based on the principle that it is not a final order and not binding upon by any party being only an intermediate stage in the proceeding, and as such no appeal, review or revision will lie against it, mainly, under the Code of Civil Procedure and even under the Code of Criminal Procedure for the obvious reason that it is the opinion expressed about certain matters referred to by the Magistrate. To infer from this, however that the also prohibited the consideration or the propriety or otherwise of the finding by , when it has been adopted by the Magistrate and an order passed on it, against which an application in revision has been filed by the party aggrieved, will amount to laying down that the by prohibiting an appeal, review or revision under Sub-section (1D) has also by implication included under it Sections 435 and 439 of the Code of Criminal Procedure. ", "Those two sections confer power upon to consider any order passed by the subordinate to it to call for the records and rectify any illegality or impropriety in the order which in some cases may also cover a case of rectifying a defective finding of fact, if it is so grave or serious as to merit interference by . In my opinion, however, Sub-section (1D) cannot be read in that form. If the intended to curtail the power of in regard to an order passed under Section 146 , Cr. P. C, there should have been side by side an amendment of Sections 435 and 439 . The same not having been done, Sub-section (1D) must be given a narrow interpretation so as to confine it only to the finding of the Civil as such and not to extend it to the position which results when such a finding has been adopted by the Magistrate and order passed upon its basis. It is true, no doubt, that the opinion expressed in some of the decisions is that this will amount to doing indirectly what could not be done directly. In my opinion, however, it will be an unsound application of the aforesaid principle in the present context. The legislature appears never to have intended barring out interference under Sections 435 and 439 . What it really intended to do was that the finding of the Civil which, in the absence of Sub-section (1D), might be liable to construction that this ' being a finding of the Civil , it might be subject to the provisions of the Code of Civil Procedure, cannot be interfered with. That contingency has been ruled out by Sub-section (1D) so that the matter would now be governed by the Code of Criminal Procedure, It is true, no doubt, that even under the Code of Criminal Procedure, the finding of the Civil as such cannot be interfered with, because, in the first place. Code of Criminal Procedure applies to the order of a Criminal and a finding of the Civil as such cannot be subject to revision under the Code of Criminal Procedure. Moreover, it is an interlocutory order and to allow it to be made subject matter of a revisional jurisdiction would be extremely inconvenient. If that were so, it may well be that will interfere with it at one stage under Article 227 or under Sections 435 and 439 , and the same finding accepted by the Magistrate may come up for examination by , if, for instance, the jurisdiction of the Magistrate to pass the order strictly in terms of Sections 145 and 146 of the Code of Criminal Procedure, such as the existence of the apprehension of a breach of the peace due to a dispute, may be questioned. Thus, there will be one proceeding under Article 227 of the Constitution and yet another proceeding under Sections 435 and 439 of the Code of Criminal Procedure for another purpose. In my opinion, therefore, such a procedure will be definitely inconvenient and cumbersome. If, on the contrary, the view adopted is that at one stage the finding of the Civil is acted upon by the Magistrate, and an order in conformity there with is passed, it becomes an order by a Magistrate and it will be subject to the provisions of Sections 435 and 439 of the Code of Criminal Procedure, the position is rationalised. This was the opinion expressed by Mr. Justice of the Madras High in the case of , AIR 1960 Mad 169. That was a case in which two applications in revision were filed by the petitioner; one against the finding of the Civil and another against the order passed by the Magistrate acting upon that finding. The High dismissed both the applications; the one against the Magistrate not on the ground of jurisdiction but on the ground that no point was made out for interference under, Section 439 , and the other one was dismissed on the ground that ho revision application against the finding of the Civil as such was maintainable in terms of Sub-section (1D) of Section 146 . But the learned Judge made the following observation : -- ", "\"(7) This restriction is but proper because the findings get merged in the decision of the magistrate and all the grounds that can be urged against the finding can be urged against the finalised decision and if there is no such restriction there will be multiplicity of proceedings and possible conflicting revisional orders reducing the whole thing to an absurdity. This wise restriction has been conceived in the best public interests and involves no invasion of the fundamental right or diminution of the paternal and supervisory jurisdiction of this \". ", "The decision seems to be in line with the opinion I have expressed above and, to my mind, that is the correct view to be followed in regard to the interpretation of the various sub-sections of Section 146 Cr. P. C. ", "I may refer in this connection to a rule of legal construction of a statute when there are provisions therein which may appear in some matters to be inconsistent with each other. It is settled that in such a case the principle of harmonious construction is to be followed and only when that is altogether precluded, on account of the plain terms of the relevant provision the question arises which is to prevail by implication. This is known as exposition ex visceribus actus. What Lord observed in v. , (1828) 7 B and C 643, 660, as quoted by (5th edition, page 94), is pertinent and runs thus : -- ", "\"In construing Acts of we are to look not only at the language of the preamble or of any particular clause, but at the language of the whole Act. And if we find in the preamble or in any particular clause an expression not so large and extensive in its import as those used in other parts of the Act, and upon a view of the whole Act we can collect from the more large and extensive expressions used in other parts the real intention of the , it is our duty to give effect to the larger expressions, put withstanding the phrases of less extensive import in the preamble or in any particular clause\". ", "Coming now to the facts of the case, the disputed lands are 8 bighas 4 kathas, being plot Nos. 585 (4 bighas 10 kathas from the east) and 592 (14 Kathas from the south) of khata No. 81 and plot No. 471 (3 bighas from the south) of Khata No. 97 of village Mohanpur. According to the case of the petitioners, who were second party, a part of this land was given to and his two brothers from whose heirs the first party purported to have purchased the disputed land. The mortgage, however was redeemed and, after redemption, the petitioners took over possession. They continued to be in possession thereafter. The case of the first pasty was that each party was in possession in his own right for a long time. In support of their respective cases, both parties adduced documentary evidence and affidavits sworn by the witnesses produced by them. A pleader Commissioner was appointed to submit his report. The documents filed by them included rent receipts, canal parchas and bill papers of sugarcane. Apart from the above documents, the first party also filed sale deeds and affidavits sworn by four persons. The learned Magistrate of Sasaram who held the enquiry found himself unable to decide the dispute on account of its complicated nature and referred the matter to the Additional Subordinate Judge of Sasaram for a finding. The latter, on a consideration of the evidence led by the parties, recorded a finding in favour of the first party and forwarded it to the Magistrate who accepted it and passed orders in favour of the first party. The second party accordingly has come up in revision against that order. ", "5. Learned Counsel for the petitioners has not raised any clear question of law, but has raised the point that the finding of the learned Additional Subordinate Judge suffers from non-consideration of certain important documents filed by the petitioners and also errors of record. He has also ignored completely the affidavits filed on behalf of the parties which also would vitiate his finding in terms of a number of decisions of this court. ", "6. In support of his first contention, he has placed before us a short history of the various transactions relating to the disputed property. Khata Nos. 81 and 97 measure 61 bighas and 4 bighas respectively. Out of this area, 23 bighas were not given in mortgage, and the mortgage which was executed in 1895 in favour of related only to 40 bighas. A rent suit was instituted by the landlord in 1895. The mortgagees were compelled to pay the entire arrears of rent and they became statutory mortgagees of the entire khatas 81 and 97 under Section 171 of the Bengal Tenancy Act. They got themselves recorded as raiyat in respect of the entire khata. In 1918, a suit was instituted by and for redemption and for a declaration that a further rent sale of the two holdings in 1905 during the subsistence of the mortgage interests was a fraudulent rent sale and the properties which were purchased by the first party did not lose their character as mortgage interest. The suit was thus framed as a composite suit one prayer of which was for redemption and the other was for declaration. The prayer for redemption was, however, withdrawn but that for declaration was pressed and the suit was dismissed. The mortgagors contemplated to prefer an appeal against that decision but, in the meantime, the parties came to an amicable settlement and on the 9th May, 1920, the terms of the compromise were drawn up by which the petitioners got back their 23 bighas and the mortgagees remained in possession of the remaining area as such. This continued up to 1951 when a part of the land was redeemed by a registered document. Another suit was instituted again for redemption of the remaining area. The suit was decreed. On appeal taken from that decision, however, the judgment of was reversed. ", "Then a second appeal was preferred. This also was compromised. A third suit, however, still remained pending. According to the petitioners, the disputed plots formed part of the 23 bighas of land which was not given in mortgage but in respect of which a statutory mortgage sprang up which, however, again, was terminated by compromise dated the 9th of May, 1920. , grandson of , the original mortgagee, sold 2 bighas 2 kathas out of the land comprised in plot No. 392, and 12 kathas and 1 bigha 10 kathas out of plot No. 471 comprised in khata No. 97, to and , first party, on the 18th of February, 1950. and applied to for mutation of their names in respect of this area of 2 bighas 12 khathas, but their application was rejected. The disputed plots, as I have mentioned above, are plot Nos. 471, 585 and 592, measuring 8 bighas. On the 3rd of February, 1960, , one of the grandsons of , executed a sale deed in favour of nephew of , opposite party No. 1, relating to 18 kathas ro dhurs out of plot No, 585 of khata No. 81. On the same date, executed another sale deed in favour of , opposite party No. 11. On the same date, , another grandson of , executed a sale deed in favour of opposite party Nos. 1, 11 and 13, namely, , and Collector , out of plot Nos. 585 and 471; 5 bighas 10 kathas out of plot No. 585 and one bigha out of plot No. 471. On the same date, executed a sale deed in favour of Collector comprising 10 kathas out of plot No. 585. In 1959, , had executed a sale deed in favour of , opposite party No. 11, conveying 15 kathas out of plot No. 585, khata No. 81. ", "Mr. appearing for the petitioners urged that all these sale deeds which, apparently, lend strong support to the case of the opposite party should have been completely discarded inasmuch as once it was held that under the compromise dated the 9th of May, 1920, 23 bighas of land were put back in possession of the mortgagors represented by the petitioners and, further that the disputed lands are comprised in those khatas, any subsequent sale deed by the family of the mortgagees relating to the same property is wholly ineffectual for the purpose of passing title to the vendees or for affecting the possession of the mortgagors. The learned Additional Subordinate Judge has lost sight of this aspect of the case. The deed of compromise (Saraite safainama), however, is an unregistered document and Mr. has contended that it has been referred to in some other documents later on. Mr. has drawn our attention to the following documents which, according to him, have not been considered at all: ", "(1) The report of the pleader commissioner who found the disputed plots amalgamated with the admitted plots of the petitioners. The report was submitted on the 26th of July, 1960. ", "(2) Report of the Canal S. D. O. dated the 18th of January, 1954. That also showed that plot No. 584 and plot No. 585 were amalgamated at least in 1954, if not earlier. ", "(3) Survey Register of Cane Cooperative Society to show that from 1940-41 to 1953 , petitioner, grew sugarcane over these plots. ", "(4) The application of the first party in 1952-53 for mutation of their names in the canal papers in regard to plot No. 585, which, was rejected. ", "(5) The application by to have his name mutated in regard to plot Nos. 571 and 592, also rejected. ", "(6) The application of opposite party No. 4 made before the Canal S. D. O. on the 15th September, 1950. That also was rejected. ", "(7) The Khatian showed that plot No. 471 is part of khata No. 97 and the receipts which are filed in respect of khata No. 81 cannot relate to the land under khata No. 97. ", "Learned Counsel has also contended that the opposite party has not filed any canal parchas from the period 1950 onwards, whereas the petitioners have filed them. He has also contended that out of the affidavits filed on behalf of the opposite party, which the learned Subordinate-Judge has not considered, the affidavits of and are of no value, as they are partisan witnesses and they are bound down along with the members of the opposite party in the proceeding under Section 107 , Code of Criminal Procedure. As for the affidavits on behalf of the petitioners, there is one by a police constable who was deputed to the village for the personal safety of the petitioners who apprehended breach of the peace from the side of the opposite party. ", "7. Mr. for the opposite party has contended that there are two Bajidawas which do not mention the names of the petitioners as having any interest in the disputed land; but it is incorrect. The finding of the learned Additional Subordinate Judge is that these Bajidawas, dated the 28th July, 1959, and 6th January, 1960, were executed after the executants parted with their interest in the disputed land. The also does not show the plot number. The field bujharat has been in favour of the first party. In my opinion, the documents in favour of the parties are of a very conflicting character. The affidavits filed on their behalf also, in the circumstances, cannot improve the position, as a result it cannot be held that the finding of the learned Additional Subordinate Judge is necessarily vitiated. It may be that there are certain errors in the finding and the consideration of the evidence is not as full and clear as it should be. For that reason, we gave liberty to the learned Counsel for the parties to place before us an analysis of the very large number of documents filed by them in support of their respective cases. In view of the fact that the -documents are of a conflicting nature, and of considerable weight for either party, I find myself unable to interfere with the findings of the learned Additional Subordinate Judge as was laid down by , C. J. in v. , 35 Cal WN 374 : (AIR 1931 Cal 619). It may be mentioned that the learned Counsel for the opposite party placed considerable reliance on the field bujharat which was prepared only a few months before the initiation of the proceedings under Section 144 , C. P. C. The has amended Sections 145 and 146 of the Code of Criminal Procedure for the sake of speedy disposal of these proceedings and to send the case back to the Court below, in the circumstances of this case, for a decision now, would mean further delay. ", "8. In the result, the application is dismissed and the rule is discharged. If the petitioners are aggrieved by the order, it will be open to them to resort to by a regular suit for declaration of title and recovery of possession. ", "Sahai, J. ", "9. I agree that there is no merit in this application, and it should be dismissed. I find it necessary, however, to express my views on some of the points which arise for determination in this case. ", "10. The points which this Bench has to consider may be formulated as follows: ", "1. Does Sub-section (1D) of Section 146 of the Code of Criminal Procedure, which is to the effect that no appeal, review or revision shall He against a finding of on a reference under the section, apply only so long as the Magistrate has not disposed of the proceeding under Section 145 in conformity with the decision of ? ", "2. Can interfere with the finding of at any stage in exercise of its power of superintendence under Article 227 of the Constitution? ", "11. As to the first question, my learned Brother , has expressed the view that the provisions of Sub-section (1D) of Section 146 bar an appeal, review or revision under the Code of Civil Procedure, and even under the Code of Criminal Procedure, only so long as the Magistrate does not pass his order in conformity with the decision of . I have considered the matter from several aspects; but, with respect, I find myself quite unable to agree with this view. ", "12. It is necessary, first, to consider the position of while hearing a reference under Section 146 and the nature of the proceeding before it. It is not possible, in my opinion, to equate the position of with an amicus curiae. The meaning of the expression 'amicus curiae' as given in Webster's New International Dictionary; is: ", "\"a friend of ; hence, in practice, a bystander or party who suggests or states some matter of law for the 's assistance\". ", "A note appended under this is to this effect: ", "\"An amicus curiae is heard only by the leave and for the assistance of the , and upon a case already before it. He has no control over the suit, and no right to Institute any proceedings therein\". ", "It is thus manifest that an amicus curiae has no legal position or right. He merely assists the by pointing out the law or evidence at the request of the , which is free to accept or reject his opinion. Under Section 146 of the Code of Criminal Procedure, the Civil has a definite statutory position. Possibly, the legislature has provided for reference to the Civil on the basis that the presiding officer of the Civil , who devotes himself exclusively to judicial work, has more experience in judicial matters than a Magistrate, who has multifarious kinds of duties, including judicial work and administrative work. Furthermore, it is not open to the Magistrate either to accept or to reject the finding of the Civil . He is bound to pass orders in conformity with the decision of the Civil . ", "13. The nature of the proceeding before continues to be criminal, and does not become civil. As stated by , J. in , AIR 1958 Pat 308, \"......the proceeding even on reference made to on the point of possession retains its old moorings and does not change its character from a criminal proceeding to a civil proceeding and is as such all along kept in the seisin of the criminal for its final conclusion\". ", "With respect, I agree with this observation as well as the reasons given therefor. ", "14. In my judgment, the only interpretation which can be put upon Sub-section (1D) is that the finding of cannot be challenged in that or in a superior at any stage. The first line of reasoning which leads me to this conclusion is very simple. Sub-section (1B) provides for to conclude the inquiry and transmit its finding to the Magistrate and for the Magistrate to dispose of the proceeding under Section 145 in conformity with the decision of . The Magistrate's function, therefore, is only to declare the possession of that party whose possession has been found by . Even after he has given such a declaration, the finding of remains the finding of that , and does not become the finding of the Magistrate. The Magistrate does pass the final order; but he cannot give any finding of his own, vide AIR 1959 Cal 366. There is thus no question of the finding of merging into the \"finding\" of the Magistrate. ", "15. Sub-section (1D) speaks of the finding of , and, if the legislature had meant that that finding would become subject to appeal, review or revision after the Magistrate passes his order, there could be no difficulty in adding, at the end of the sub-section, the words 'until the Magistrate passes his final order. Addition of those words was necessary also because an earlier Sub-section, i.e. (1B), has provided for the passing of the final order by the Magistrate. In the absence of those words, it is not possible for me to hold that the finding remains sacrosanct so long as the Magistrate does not pass his final order but becomes subject to revision by like any other order of an inferior as soon as he passes such order. ", "16. The question can be considered from another point of view. I have already observed that the proceeding before retains its nature as a criminal proceeding. No appeal, review or revision under the Code of Civil Procedure could, therefore, be entertained against the finding of , even if Sub-section (1D) had not existed. No appeal against that finding could lie even under the Code of Criminal Procedure because Section 404 of that Code lays down that no appeal would lie from any judgment or order of except as provided by the Code or any other law for the time being in force. Ho section of the Code nor any other law provides for an appeal against the finding of on a, reference under Section 146 . There is no provision in the Code , giving power to to review its own judgment. Unless the power of review was specifically given to , therefore, it could not review its finding on a reference of the kind in question. A revision could also not lie under Sections 435 and 439 because Section 435 speaks of the record in a proceeding before an inferior Criminal Court being called for and examined, and Section 439 speaks of orders which may be passed in a proceeding, the record of which has been called for by itself or has been reported for orders. ", "At the stage when arrives at its finding and before the Magistrate passes his final order, the record is not before an inferior . Hence, powers under Sections 435 and 439 cannot be exercised. Even if it is assumed, however, that a criminal revision lies because the proceeding can be said to be one before an inferior on the ground that the Magistrate retains seisin over it even while the reference is pending before all that was necessary to provide for under Sub-section (1D) was to bar a criminal revision against the finding of . Instead of doing that, the legislature has used very strong language by saying that no appeal, review or revision would lie. If the only purpose was to bar a criminal revision against the finding of until the Magistrate passed his final order, it would mean that the legislature unnecessarily used very emphatic language to achieve very little. ", "17. It is said that, if the legislature intended by enacting Sub-section (1D) to curtail power of revision, there should have been a corresponding amendment of Sections 435 and 439 . I am unable to agree. There is, in my opinion, not the slightest doubt that a revision lies against the final order of the Magistrate because there is no prohibition in Section 146 against a petition for revision being entertained from the Magistrate's order. All that Sub-section (1D) means is that the finding of will not be liable to be challenged before that Court or a superior Court. In view of the amendment introduced in Sections 145 and 146 by Act 26 of 1955, there are three different stages in a proceeding under Section 145 . At the first stage, the Magistrate draws up a proceeding under that section when be is satisfied that a dispute likely to cause a breach of the peace exists concerning any land or water or its boundaries. He then proceeds under Section 145 , and, if he can find possession with either party as required by Sub-section (4) of that section, he declares that party to be in possession. It is only if he is of opinion that none of the parties is in possession or if he is unable to decide as to which party is in possession that he can make a reference to . The first stage is over when the reference is made. The second stage is the inquiry before ending with a finding arrived at by that Court relating to possession. The third stage starts when the finding goes to the Magistrate. He has then to pass final order in conformity with the finding. power to examine the proceedings before the Magistrate in the first and the third stages cannot be doubted. All that Sub-section (1D) says is that the finding of will not be liable to be challenged. It is thus open to to interfere if the Magistrate's order is not in conformity with 's finding or if there is some illegality in drawing up the proceeding or in making the reference. The restriction against interference with 's finding is a special provision, and it is a well-established principle that a special provision controls a general provision. It was not, therefore, necessary to amend Sections 435 and 439 of the Code. ", "18. I may mention another point. The amended Sections 145 and 146 by Act 26 of 1955 with the purpose of expediting disposal of a proceeding under Section 145 . It is for this reason that parties' right to examine witnesses has been taken away, and they have now to file affidavits instead in a proceeding under Section 145 . Besides, the legislature has expressed its hope in Sub-section (4) of Section 145 that the Magistrate would as far as practicable, conclude the inquiry within a period of two months. Under Section 146 , as it stood previously, the Magistrate had to attach the disputed property in case he was unable to find which of the parties was in possession. That has been done away with. In view of the amendments, the matter has to be referred to , and the proceeding under Section 145 has to be terminated in accordance with the finding of which has to conclude the inquiry, as far as practicable, within a period of three months. Sub-section (1E) of Section 146 provides that the order passed under Section 146 would be subject to a subsequent decision of of competent jurisdiction. In view of that provision, the finding of on a reference is not conclusive for all time. That being so, I do not think that there is any hardship to any party if the provisions of Sub-section (1D) are construed to mean that the finding of cannot be challenged in criminal revision at any stage. ", "19. In my opinion, continues to have power to interfere with the finding of in exercise of its power of superintendence under Article 227 of the Constitution, if a case is made out for exercise of that power. I do not think that it will be inconvenient or cumbersome for any party to seek his remedy against an order passed by the Magistrate under Section 145 on the basis of 's finding. He can file his petition under Sections 435 and 439 as well as Article 227 of the Constitution. will then interfere under Article 227 with the finding of only if a case for interference under that Article is made out; but it will exercise its ordinary power of revision under Sections 435 and 439 in so far as the proceedings before the Magistrate are concerned. I do not apprehend any difficulty if this procedure is followed. ", "20. Views similar to those which I have expressed above on the interpretation of Sub-section (1D) have been taken by , J; in AIR 1959 Mad 111. In that case, the petition for revision was filed against the final order of the Magistrate. The learned Judge observed that no appeal, review or revision could lie against the finding of . He further observed that could not go into the correctness of the finding of because that would amount to doing indirectly what was prohibited directly. This reasoning also supports the conclusion which I have reached. In AIR 1960 Mad 169, , J. has relied upon the decision in case, AIR 1959 Mad 111, on the point that no revision lies against the finding of , but has made certain observations which indicate that the restriction applies only so long as the finding of does not \"get merged in the decision of the Magistrate\". With great respect, I am unable to accept the observation as correct. As I have already said, the. Magistrate does not arrive at any finding, and there is no question of merger of findings. All that happens is that the Magistrate declares one party or the other to be in possession in accordance with the finding of , which continues to retain its separate identity. ", "21. I may also refer to a Bench decision of this Court in 1962 BLJR 267: (AIR 1962 Pat 468) in which I delivered the judgment of the Bench. The conclusions which I have reached in that decision are in accord with the conclusion which I have reached in this case. ", "22. Though the finding of is, under Sub-section (1D), not subject to appeal, review or revision, the constitutional power of superintendence given to under Article 227 cannot be held to have been taken away. I may, refer only to AIR 1952 Cal 526 in this connection. Under Section 9(1) of the West Bengal Bargadars Act, it was provided that no award or order of a or of an Appellate Officer shall be questioned in any . The High was included under the definition of ''. Their Lordships observed that those provisions could not prevail against the Constitution, and that could, in suitable cases, pass a necessary order in exercise of its power under Article 227. ", "23. It has been argued that ought not to pass an order in exercise of its power under Article 227 , if a suitable alternative remedy is available. I agree with my learned Brother , J. that there is no inflexible rule that cannot issue a writ or pass an order in exercise of its power under Article 227 simply because an alternative remedy is available. I also agree that has discretion to entertain a petition for issue of a writ or order notwithstanding the existence of such an alternative remedy in suitable cases. In the present case, I have held that, in a criminal revision arising out of a final order of the Magistrate, cannot examine the correctness of finding. This remedy is, therefore, not open to the aggrieved party. The only other remedy is provided in Sub-section (1E) of Section 146 . In pursuance of that remedy, an aggrieved party has to institute a suit. In my opinion, cannot refuse to interfere in exercise of its power under Article 227 , if a case is made oat for exercise of such power, only on the ground that, by means of a lengthy remedy of a suit, the aggrieved party can get his redress. I wish only to add that, as a rule, will decline to interfere under Article 227 before the Magistrate passes his final order on the ground that it will be inconvenient and duplication of work to entertain one petition before and one petition after the Magistrate passes his final order in conformity with the finding of . ", "24. The limits of exercise of powers under Article 227 are well settled. In AIR 1960 SC 137, their Lordships have observed about the power under Article 227 as follows: ", "\"However wide it (the power) may be than the provisions of Section 115 of the Code of Civil Procedure, it is well established that cannot in exercise of its power under that section assume appellate powers to correct every mistake of law. Here there is no question of assumption of excessive jurisdiction or refusal to exercise jurisdiction or any irregularity or illegality in the procedure or any breach of any rule of natural justice. If anything it may merely be an erroneous decision which, the error not being apparent on the face of the record, cannot be corrected by in revision under Section 115 of the Code of Civil Procedure or under Article 227\". ", "25. For the reasons given above, I would answer the first question which I have formulated by saying that the bar applies at all stages and the second question by saying that can and would interfere with finding in appropriate cases under Article 227 after the Magistrate passes his final order in accordance with that finding. We could, therefore, interfere with the finding of the learned in this case, if a case for exercise of our power under Article 227 of the Constitution had been made out. My learned Brother , has discussed the merits, and if is perfectly clear that no such case has been made out. Hence, I agree with the order proposed. ", ", J. ", "26. I have had the advantage of perusing the judgments of my esteemed brethren , and , and I agree that Criminal Miscellaneous No. 100 of 1962 should be dismissed. ", "27. I would, however, add a few words of my own. The important question for consideration is whether can interfere with the finding of under Sections 435 and 439 of the Code of Criminal Procedure after the finding is adopted by the Magistrate and the final, order is passed. ", "28. Sub-section (i) of Section 146 Cr. P. C. provides for a reference to for a decision of the question whether any or which of the parties was in possession, if the Magistrate is of the opinion that none of the parties was then in such possession or is unable to decide as to which of them was then in such possession of the subject of dispute. ", "29. Sub-section (1A) lays down how shall dispose of the reference and decide the question of possession. Sub-section (1B) is important. It directs to conclude the inquiry within three months of the appearance of the parties before it and transmit its finding to the Magistrate and the Magistrate shall dispose of the proceeding in conformity with the decision of . Sub-section (1C) provides for costs of the reference. Then follows the controversial provision incorporated in Sub-section (1D). It provides that no appeal from nor any review or revision of any such finding of shall He. It will be observed that this provision does not impose any bar to any review or revision of the order of the Magistrate passed under Sub-section (1B). It only provides that the finding of (and not the order of the Magistrate) shall not be questioned in review or revision. ", "30. Another noteworthy thing is that no alteration has been made in Sections 435 and 439 with the result that the powers of under these sections remains unaffected. There is, therefore, no reason to bar a revision from the order of the Magistrate passed under Sub-section (1B). It will also be observed that if the Magistrate himself decides the question of possession without reference to and passes order under Section 145 , Criminal Procedure Code , declaring the possession of one or the other party, it is beyond controversy that that order is open to revision. There appears to be no foundation for distinction between an order passed by a Magistrate under Sub-section (4) of Section 145 and Sub-section (1B) of Section 146 of the Code of Criminal Procedure. It is recognised that a revision may lie even against the order of the Magistrate under Sub-section (1B) of Section 146 , Cr. P. C. but it is said that the revision in such a case must be limited in scope but there would appear no ground for such a differentiation. To say that powers under Sections 435 and 439 can be exercised without limitation in respect of an order passed under Sub-section (4) of Section 145 and for a limited purpose under Sub-section (1B) of Section 146 is to introduce substantial qualification in Sections 435 and 439 , which the in its wisdom did not think it proper to do. ", "31. It is argued that it would be anomalous to question the finding of after it is integrated in the order of the Magistrate when appeals from and review or revision of such an order is completely barred. This argument sounds plausible but lacks substance. Taking Section 146 , Cr. P. C. as a whole, the intention of the appears to be to bar revision, review or appeal at different stages of the same proceeding. It is, manifest that the has not expressly' barred a revision or review of the order of the Magistrate under Sub-section (1B). To permit revision against the finding of at one stage and also against the order of the Magistrate at another stage would have frustrated the very object of the amendment,\" namely, to shorten the duration of the proceeding under Section 145 , Cr. P. C. This is so because one function is assigned to the civil and the other to the Magistrate. Therefore, in my opinion, when a revision is preferred against the order of the Magistrate under Sub-section (1B), not only the operative order of the Magistrate but the entire proceeding including the findings of the civil are before the and, therefore can, in appropriate cases, interfere with the findings of the civil , if they are in flagrant violation of the well recognised principles of law. Such a construction not only harmonises the different provisions of Sections 145 and 146 , but also dispenses with the limitations sought to be imposed upon the powers of under Sections 435 and 439 . Once we proceed to lay down the qualification, it would be difficult to draw a line where to stop. It is true that this will not ordinarily \"interfere with a considered finding of the civil . At the same time, it is difficult to prescribe the exact principles which may guide in disposing of the matters in all such cases. ", "32. As regards application of Article 227 of the Constitution of India, it is altogether a different question The powers of , cannot be taken away or abridged by a Legislative enactment; and, as such, Sub-section (1D) of Section 146 has not and cannot have that effect. , however, as a rule, will not interfere with the finding of merely on the ground of non-consideration of some evidence or some irregularity found to have been committed by . It is only in exceptional cases of flagrant violation of legal principles and that also after the Magistrate has passed final orders in conformity with such finding that will interfere. Otherwise, such an interference at an earlier stage will lead to duplication and prolongation of the proceedings which the has intended to avoid. ", "33. For these reasons, I agree with the views expressed by my esteemed brother , "], "relevant_candidates": ["0000107104", "0000190651", "0000329840", "0000568069", "0000882004", "0001024484", "0001045538", "0001346544", "0001406173", "0001450722", "0001695633", "0001775619"]} {"id": "0000328748", "text": ["PETITIONER: N. MEERA RANI Vs. RESPONDENT: GOVERNMENT OF & ANR. DATE OF JUDGMENT22/08/1989 BENCH: , JAGDISH SARAN (J) BENCH: , JAGDISH SARAN (J) RANGNATHAN, S. OJHA, N.D. (J) CITATION: 1989 AIR 2027 1989 SCR (3) 901 1989 SCC (4) 418 JT 1989 (3) 478 1989 SCALE (2)363 CITATOR INFO : R 1990 SC 516 (10) R 1990 SC1196 (5,18) RF 1990 SC1202 (11,12) D 1990 SC1763 (5) RF 1991 SC1640 (12) RF 1991 SC2261 (12) ACT: National Security Act , 1980-- Section 3(2) and 12(1) subsisting custody of detenue does not invalidate order of detention--Detention order can be made in anticipation to operate on release of detenue. HEADNOTE: By an order dated 7.9.88 the Collector & District Magis- trate Madurai under s. 3(2) of the National Security Act, 1980 made an order for keeping in custody , the husband of the appellant/ petitioner. The State . on 25.10.88 by its order under s. 12(1) of the Act confirmed the order of detention agreeing with the opinion of and ordered the detention of the detenue for 12 months from the date of his detention. The wife of the detenue challenged this preventive detention by filing a writ of Habeas Corpus in . by its order dated 6.3.89 dismissed the writ petition. The appellant-petitioner challenged the dismissal of the writ by by way of special leave and also by filing a writ petition under Article 32 of the Constitution of India. This Court while quashing the detention order, HELD: Subsisting custody of the detenue by itself does not invalidate an order of his preventive detention and the decision must depend on the facts of the particular case; preventive detention being necessary to prevent the detenue from acting in any manner prejudicial to the security of the State or to the maintenance of public order etc. ordinarily it is not needed when the detenue is already in custody; the detaining authority must show its awareness to the fact of subsisting custody of the detenue and take that factor into account while making the order; but, even so, if the detain- ing authority is reasonably satisfied on cogent material that there is likelihood of his release and in view of his antecedent activities which are proximate in point of time he must be detained in order to prevent him from indulging in such prejudicial activities, the detention order can be validly made even in anticipation to operate on his release. [919E-G] In the instant case, the the detention order read with its annexure indicates the detaining authority's awareness of the fact of detenue's 902 jail custody at the time of the making of the detention order. However there is no indication therein that the dete- nue could be released on bail. On the contrary the detention order shows satisfaction of the detaining authority that there was ample material to support the criminal charge against the detenue. The order of detention passed on 7.9.1988 and its confirmation by on 25.10.1988 is therefore clearly invalid since the same was made when the detenue was already in jail custody for the offence of bank dacoity with no prospect of his release. [919H- ., 4 SCR 921--relied upon. ., 3 SCC 490; Dr. v. District Magis- trate, Jabalpur & Anr., 4 SCC 164; ., 2 SCC 43; , Dhanbad, 3 SCR 939; ., 4 SCC 232; - bad, Bihar & Ors., 4 SCC 416; ., 4 SCC 48 and Smt. Shashi Aggarwal v. State of U. P. & Ors., 1 SCC 436. JUDGMENT: ", "CRIMINAL APPELLATE JURISDICTION: Criminal Appeal No. 511 of 1989. ", "From the Judgment and Order dated 6.3.1989 of in W.P. No. 14828 of 1988. ", "WITH Writ Petition (Criminal) No. 205 of 1989. ", "(Under Article 32 of the Constitution of India). and for the Appellant/Petitioner. , and for the Respondents. ", "The Judgment of the Court was delivered by , Special leave granted. ", "903 ", "The appellant-petitioner, Smt. , is the wife of , who has been detained under the Nation- al Security Act , 1980 (Act No. 65 of 1980) (hereinafter referred to as \"the Act\"). An order dated 7.9.1988 was made by the Collector and District Magistrate, Madurai, under section 3(2) of the Act directing that the detenu be kept in custody in the Central Prison, Madurai. Thereafter, by its order dated 25.10.1988 made under section 12(1) of the Act has confirmed the order of deten- tion agreeing with the opinion of consti- tuted under the Act and directed that the detenu be kept in detention for a period of 12 months from the date of his detention. This preventive detention of the detenu was challenged in at Madras by his wife, the appellant-petitioner, under Article 226 of the Constitution praying for issuance of a writ of habeas cor- pus. by its order dated 6.3.1989 has dis- missed the writ petition. The appellant-petitioner has then challenged dismissal of the writ petition by by special leave under Article 136 of the Constitution of India in this . The appellant-petitioner has also filed a writ petition under Article 32 of the Constitution of India for the same purpose in this challenging direct- ly her husband's preventive detention. The object of filing this writ petition directly in this , in addition to the appeal by special leave, is to raise some additional grounds to challenge the detenu's detention. Both these matters have been heard together and are being disposed of by this common judgment. ", "We may now state the arguments advanced to challenge the detenu's detention before mentioning the relevant facts which are material for deciding those points. , learned counsel for the appellant-petitioner, has advanced three contentions. The first contention is that certain documents which have been referred to in some grounds of detention were not supplied to the detenu with the result that the detenu was not given a proper and rea- sonable opportunity for making an effective representation and, therefore, the order of detention is vitiated for this reason alone. The second contention is that some documents in the form of newspaper reports showing that the detenu was apprehended and detained even prior to 21.8.1988 when the detenu was shown to have been arrested in connection with an offence punishable under section 397 I.P.C. were not placed before the detaining authority when it formed the opinion mentioned in the detention order which has also vitiated the detention order. The last contention is that the fact of detenu's arrest in connection with an offence punishable under section 397 I.P.C. and of remand to custody by the Magistrate as well as the contents of the bail application dated 22.8.1988 which was rejected by the Magistrate were not taken into account by the detaining authority before passing the order of detention dated 7.9.1988 which also renders the detention order invalid. On the other hand, , learned counsel for the respondents contended that even assuming that some documents referred in the grounds of detention were material and were not supplied to the detenu the effect is not to invalidate the detention order for that reason alone in view of section 5A of the Act which has been inserted by Act 60 of 1984 with effect from 21.6.1984 since the detention order can be sustained even on the remaining grounds. In respect of the detenu's custody in connection with the offence under section 397 I.P.C. and rejection of his bail application, it was urged that this fact was con- sidered by the detaining authority and, therefore, it does not result in any infirmity. , on behalf of the appellant-petitioner, further contended that section 5A of the Act cannot be construed in the manner suggested by the learned counsel for the respondents since the guarantee to the detenu under Article 22(5) of the Constitution results in invalidating the entire detention order as claimed by him. ", "The material facts mentioned in the detention order and its annexure are now stated. A branch of is located in a rented accommodation in flat No. 634, K.K. Nagar in Madurai. On 6.8.1988, the Manager and the staff of the were attending to the business of the which then had 443 packets containing valuable ornaments weighing about 20,576.150 grams valued at about rupees sixty-two lakhs and cash amounting to Rs.38,945.00. These gold ornaments were pledged with the as security for loans advanced by the of certain borrowers. At about 10.55 A.M. on 6.8.1988 the was looted and these orna- ments and cash were taken away by armed dacoits on the point of revolver after locking the employees and customers in the strong room. The dacoits escaped in an ambassador car with registration No. TDL-9683 and a motorcycle bearing registration No. TNK-6727. The dacoits are stated to be one and some other Sri Lanka nationals who were tempo- rarily living in a nearby flat which was in the possession of the detenu. It is stated that the ambassador car used in the dacoity had been stolen on 4.8.1988 from Quilon in the State of Kerala by and his companions. It is further stated that the dacoity was committed in order to fund the militant organisation known as with which the detenu has been associated and that the detenu along with these Sri Lanka nationals belonging to the Sri Lanka militant organisation had entered into a criminal conspiracy to commit these cognizable offences. The object of these militant organisations is to achieve a separate Tamil Ealam in Sri Lanka and to secure secession of Tamil Nadu from by violent means. It is further stated that the detenu received from through and a share of the booty comprising of gold ornaments weighing about 8325. 150 grams valued at about Rs.25 lakhs and Rs. 15,000.00 in cash which was a part of the booty looted from the on 6.8.1988 in addition to a box con- taining one revolver, 2 pistols, 3 grenades, 6 bombs and a knife. It is further stated that on 9.8.1988 the detenu took and in his car bearing registration No. TNU- 8500 to Madras along with and and subsequent- ly on 10.8.1988 the detenu sent them to Nellore in Andhra Pradesh in his car to help them escape. It is also stated that a note was sent by the detenu to the news media in the name of owning respon- sibility for the dacoity and threatening the law enforcement agency and the Government servants with dire consequences if they attempted to apprehend them. It is then said that on 21.8.1988 the detenu was arrested at Samayanallur while he was driving his car bearing registration No. TNU-8500 to- wards Madurai when he made a voluntary confession in the presence of witnesses. The car bearing registration No. TNU-8500 was seized at 19.15 hours on 21.8.1988 in front of and the detenu's confession led to recovery of gold ornaments weighing about 7275.750 grams valued at Rs.21,85,000.00 in 172 bags and 19 empty bags with tags and chits and a set of keys from the detenu's house on 21.8.1988 at 20.15 hours. In pursuance to detenu's confession recovery was also made of a box containing one revolver, 2 pistols with ammunition, 3 grenades, 6 bombs and one knife from the house of , an employee of the detenu in Madurai. Further recovery of a bag containing gold ornaments weighing about 1015.600 grams valued at Rs.3,05,000.00 was made from the shop of in Madurai and also made a confession pursuant to which the recovery was made of gold ornaments weighing about 25.900 grams from . Subsequently, these ornaments were identified as those which had been looted in the above-mentioned dacoity on 6.8.1988. It is on these grounds that the impugned detention order dated 7.9.1988 was passed for the detenu's preventive detention under the Act. The detention order as well as its annexure containing the relevant ground of detention are quoted as under: ", "\"ANNEXURE 'A' PROCEEDINGS OF THE COLLECTOR AND DISTRICT MAGISTRATE, . ", "PRESENT: , I.A.S. ", "N.S.A. NO. 73/88 Dated: 7.9.1988 DETENTION ORDER WHEREAS, I, M. DEVARAJ, I.A.S. ", "Collector and District Magistrate, Madurai, am satisfied with respect to the person known as @ Thambi, male, aged 30 years, S/o (late) , residing at Block No. 2, H.I.G. Colony, Anna Nagar, Madu- rai Town that with a view to preventing him from acting in any manner prejudicial to the maintenance of public order, it is necessary to make the following order. ", "(2) Now, therefore, in exercise of the powers conferred by sub-section (2) of section 3 of the National Security Act, 1980 (Central Act 65 of 1980) read with orders issued by the Government in G.O. Ms. No. 1169, public (L & O-F) Department, dated 3.8.1988 under sub-section (3) of the said Act, I hereby direct that the said @ Thambi be detained and kept in custody in the Central Prison, Madurai. ", "Given under my hand and seal of office, this the 7th day of September, 1988. ", "sd/- ", "Collector and District Magistrate, Madurai To Thiru Nallathambi @ Thambi, S/o (Late) Thiru S. Mathu, Block No. 2, H.I.G. Colony, Anna Nagar, Madurai-20. ", "(Now in Central Prison, Madurai as remand prisoner) Through. , Deputy Superin- tendent of , Tirupparankundram, Madurai City, for service under acknowledgement.\" ", "\"ANNEXURE 'B' N.S.A. No. 73/88 Dated 7.9.88 ", "Sub: National Security Act , 1980 (Central Act 65 of 1980)--detention of alias , Male aged 30 years, S/o (Late) S. Mathu, 2, H.I.G. Colony, Anna Nagar, Madu- rai u/s. 3(2) of the National Security Act , 1980--Grounds of detention. ", "A detention order under section 3(2) of the National Security Act (Central Act 65 of 1980) has been made on alias , male, aged 30 years, s/o (Late) S. Mathu, 2, H.I.G. Colony, Anna Nagar, Madurai vide order NSA No. 73/88 dated 7.9.1988. (2) The grounds on which the said deten- tion has been made are as follows: ", "XXX XXX XXX XXX ", "(9) In furtherance of the conspiracy sent a note to the news media in the name of Tamil Nadu Makkal Vidhuthalai Eyakkam owning responsibility for the dacoity and threatening the law enforcement agency and Government servants with dire consequences if they dare to apprehend them. ", "(10) On 21.8.88 at 1400 hours, , was arrested at Samayanallur while he was driving his car TNU 8500 towards Madurai. He gave a voluntary confession which was recorded in the presence of witness (1) , Village Administrative Officer, Sathamgalam and (2)Pannerselvam, Village Administrative Officer, Thiruppalai. The car TNU 8500 was seized at 1915 hours on 21.8.88 in front of . In pursuance of his confession gold jewels weighing about 7275.750 grams valued at Rs.21,85,000.00 in 172 bags and 19 empty bags with bank tags and chits and a set of key were recovered from his house on 21.8.88 at 20.15 hours. Further in pursuance of his confession a box containing 1 revolver, 2 pistols with ammunition, 3 gre- nedes, 6 bombs, 1 knife was recovered from the house of accused located in 27, Lakshimipuram, 6th Street, Madurai who is also an employee under . Further pursuant to his confession a bag containing gold jewels weighing about 1015.600 grams valued Rs.3,05,000.00 was recovered from the moulding workshop of accused located in 10-A, Bharatiar Main Street, K. Pudur, Madurai. Pursuant to the confession of gold jewels weighing about 25.900 grams was recovered from the accused . The above jewels recovered were identified to be stolen from on 6.8.88. ", "(11) The chance prints developed from the scene of occurrance in , K.K. Nagar Branch, Madurai tallied with the fingerprints of accused . (12) The chance prints developed from the ambassador car TDL 9683 which was abandoned at new Mahali Party Street, Madurai after the commission of armed dacoity tallied with the finger-prints of accused . ", "(13) The chance prints developed from the ambassador car TDL 1919 and TDT 3699 which were used in earlier attempts tallied with the finger-prints of accused . ", "XXX XXX XXX (18) I am aware that Thiru Nalla- ", "thambi is in remand and would be proceeded with under normal law. Though the name of does not find a place in the F.I.R. and though he has not physically par- ticipated in the commission of the armed dacoity, a reading of the records and the statement clearly disclosed the facts that , was an active participant in the said conspiracy to loot the K.K. Nagar branch of . In furtherance of the conspiracy had made preparation for the commission of the armed dacoity as discussed in para 4 above. Further had received a portion of booty of gold jewels weighing about 8325. 150 grams valued Rs.25 lakhs and cash Rs. 15,000.00 from the stolen jewels and cash robbed from the abovesaid Bank and re- ceived a box containing 1 revolver, 2 pistols, 3 grenades, 6 bombs and a knife used in the commission of offence. Subsequently, the said jewels, firearms and bombs mentioned above were recovered in pursuance of the confession of . Further sent a notice to the News Media in the name of \"Tamil Nadu Makkal Vidhuthalai Eyakkam\" owning responsibility of the armed dacoity and threatening the law enforcement agency and Government servants with dire consequences if they dare to apprehend them. Therefore, as a detaining authority I am satisfied that there is compelling necessity warranting the deten- tion of under the National Security Act and if is allowed to remain at large it will not be possible to prevent him from indulging in activities prejudicial to the maintenance of public order. ", "(19) I am also satisfied on the materials mentioned above that if is allowed to remain at large, he will indulge in further activities prejudicial to the maintenance of public order and further the recourse to normal law would not have their desired effect of effectively preventing him from indulging in activities prejudicial to the maintenance of public order and, there- fore, I consider that it is necessary to detain him in custody with a view to prevent- ing him from acting in any manner prejudicial to the maintenance of public order. ", "XXX XXX XXX XXX.\" ", "The first argument of the learned counsel for the appel- ", "lantpetitioner is based on the above quoted grounds in para Nos. 11, 12 and 13 relating to the chance printes developed from the scene of occurrence in the , the ambassador cars TDL 9683, TDL 1919 and TDT 3699 which tallied with the finger-prints of , an accused in the dacoity case. It was argued that the report of the finger-prints expert who gave this opinion was not supplied to the detenu even though it was a material document to enable the detenu to make an effective representation in respect of these grounds of detention. Another similar document relates to ground No. 9 which mentions a note sent by the detenu to the newspaper media in the name of Tamil Nadu Makkal Vidu- thalai Eyakkam owning responsibility for the dacoity and threatening the law enforcement agency and Government servants with dire consequences if they dare to apprehend them. It was argued that the non-supply of these documents on which the grounds of detention Nos. 9, 11, 12 and 13 are based has deprived the detenu of his legitimate right of effective representation against the same which is guaran- teed under Article 22(5) of the Constitution of India and this defect results in invalidating the entire detention order. The reply of learned counsel for the respondents is that section 5A of the Act is a complete answer to this argument inasmuch as this defect at best requires only the exclusion of these grounds of detention and no more. It was urged by learned counsel for respondents that the remaining grounds of detention were sufficient to sustain the deten- tion order by virtue of section 5A of the Act. Learned counsel for the appellant-petitioner also contended that such a result is not envisaged by section 5A of the Act which did not apply to such a situation and the guarantee under Article 22(5) of the Constitution rendered the defect fatal to the detention order. ", " Section 5A of the Act clearly provides that the deten- tion order under section 3 of the Act has been made on two or more grounds, shall be deemed to have been made separate- ly on each of such grounds and accordingly such order shall not be deemed to be invalid merely because one or some of the grounds is or are invalid for any reason whatsoever. It further says that the detaining authority shall be deemed to have made a detention order after being satisfied as provid- ed in section 3 with reference to the remaining grounds or ground. In other words, a ground of detention which is rendered invalid for any reason whatsoever, shall be treated as non-existent and the surviving grounds which remain after excluding the invalid grounds shall be deemed to be the foundation of the detention order. Section 5A was inserted in the Act with effect from 21.6.1984 to overcome the effect of the decisions which had held that where one or more of the grounds of detention is found to be invalid, the entire detention order must fall since it would not be possible to hold that the detaining authority making such order would have been satisfied as provided in section 3 with reference to the remaining ground or grounds. It is, therefore, doubt- ful whether the construction of Section 5A suggested by learned counsel for the appellant-petitioner can be accept- ed. However, in the present case, it is not necessary for us to express any concluded opinion on this point since we have reached the conclusion that the detention order must be quashed on one of the other contentions to which we shall advert later. The second argument of learned counsel for the respond- ents may also be considered before we deal with the last contention on which we propose to quash the detention order. The second contention is that the detenu's arrest in connec- tion with the dacoity case is shown on 21.8.1988 when he was actually arrested much earlier in connection with the dacoity as appeared in some local newspapers but those newspaper reports are not shown to have been placed before the detaining authority. On this basis, it was argued that the satisfaction reached by the detaining authority has been vitiated. ", "The question of the date on which the detenu was taken into custody in connection with the Bank dacoity is material for the last contention which we shall consider hereafter but the same has no relevance in this connection. Contents of the newspaper reports except for the fact of earlier arrest which was known to the detaining authority were not relevant for the satisfaction needed to justify making of the detention order. The detaining authority's satisfaction was to be formed on the basis of material relevant to show the detenu's activities requiring his preventive detention with a view to prevent him from acting in a manner prejudi- cial to the maintenance of the public order. The newspaper reports indicating that the detenu was already in custody could at best be relevant only to show the fact that he' was already in detention prior to the making of the detention order. We have already mentioned that this fact of the detenu's custody before the making of the order of detention on 7.9.1988 was known to the detaining authority and its effect is a separate point considered later. The other contents of the newspaper reports had no other relevance for this purpose. This contention of learned counsel for the appellantpetitioner is, therefore, rejected. The last contention of learned counsel is based on the fact that the detenu was already in custody in connection with the Bank dacoity when the order of detention was made on 7.9.1988. It is also clear that on 22.8.1988 the detenu had moved a bail application which had been rejected and he had been remanded to custody. It is significant that the detention order itself describes the detenu as a person in custody in the Central Prison at Madurai and the order was served on him through the Superintendent of the Prison. The question now is of the effect of the detenu's earlier custody on the validity of the deten- tion order. ", "The contents of the detention order and its accompanying annexure clearly show that the detaining authority was aware and conscious of the fact that the was already in custody in connection with at the time of making the detention order. The fact that the 's application for grant of bail in the dacoity case had been rejected on 22.8.1989 and he was remanded to custody for the offence of bank dacoity punishable under section 397 I.P.C. is also evident from the record. The detention order came to be made on 7.9.1988 on the above grounds in these circum- stances. In the detention order the detaining authority recorded its satisfaction that the 's preventive detention was necessary to prevent him from indulging in activities prejudicial to maintenance of public order in which he would indulge if he was allowed to remain at large. The above quoted paragraphs 18 and 19 of the Annexure to the detention order clearly disclose this factual position. However, it may be pointed out that the detention order read along with its annexure nowhere indicates that the detaining authority apprehended the likelihood of the being released on bail in the dacoity case and, therefore, consid- ered the detention order necessary. On the contrary, its contents, particularly those of the above quoted paragraph 18 clearly mention that the had been remanded to custody for being proceeded against in due course and even though his name was not mentioned in the F.I.R. as one of the dacoits who participated in the commission of the armed Bank dacoity yet the documents clearly revealed that the was an active participant in the conspiracy to loot the bank in furtherance of which the dacoity was committed; and that considerable booty of that crime including weapons, bombs and hand-grenades were recovered from his possession pursuant to the 's confession made after his arrest. These averments in the detention order indicate the satis- faction of the detaining authority that in its view there was ample material to prove the 's active participa- tion in the crime and sharing the booty for which offence he had already been taken into custody. This view of the de- taining authority negatives the impression of likelihood of being released on bail. ", "The real question, therefore, is: whether after the above satisfaction reached by the detaining authority and when the detenu was already in custody being arrested in connection with the Bank dacoity, could there be any reason- able basis for making the detention order and serving it on the detenu during his custody? ", "We may now refer to the decisions on the basis of which this point is to be decided. The starting point is the decision of in v. District Magis- trate, Burdwan & Anr., [964] 4 SCR 92 1. All subsequent decisions which are cited have to be read in the light of this decision since they are decisions by Benches comprised of lesser number of Judges. It is obvious that none of these subsequent decisions could have intended taking a view contrary to that of the in 's case (supra). ", "The detention order in case (supra) was made and also served on the detenu while he was in jail custody. The detenu was then in jail where he had been kept as a result of the remand order passed by the competent court which had taken cognizance of a criminal complaint against him. The Constitution Bench considered the effect of the detenu's subsisting detention at the time of making of the order of preventive detention and held that the effect thereof had to be decided on the facts of the case; and that this was a material factor to be considered by the detaining authority while reaching the satisfaction that an order of preventive detention was necessary to prevent the detenu from acting in a manner prejudicial to the maintenance of public order after his release. It was indicated that the detenu's subsisting custody did not by itself invalidate the detention order but facts and circumstances justifying the order of preventive detention notwithstanding his custody were necessary to sustain such an order. ", "The position of law was summarised by their Lordships as under: ", "\"As an abstract proposition of law, there may not be any doubt that s. 3(1)(a) does not preclude the authority from passing an order of detention against a person whilst he is in detention or in jail; but the relevant facts in connection with the making of the order may differ and that may make a difference in the application of the principle that a detention order can be passed against a person in jail. Take for instance, a case where a person has been sentenced to rigorous imprisonment for ten years. It cannot be seriously suggested that soon after the sentence of imprisonment is pronounced on the person, the detaining authority can make an order directing the detention of the said person after he is released from jail at the end of the period of the sentence imposed on him. In dealing with this question, again the considerations of proximity of time will not be irrelevant. On the other hand, if a person who is undergoing imprisonment, for a very short period, say for a month or two or so, and it is known that he would soon be released from jail, it may be possible for the authority to consider the antecedent history of the said person and decide whether the detention of the said person would be necessary after he is released from jail, and if the authority is bona fide satisfied that such detention is necessary, he can make a valid order of deten- tion a few days before the person is likely to be released. The antecedent history and the past conduct on which the order of detention would be based would, in such a case, be proximate in point of time and would have a rational connection with the conclusion drawn by the authority that the detention of the person after his release is necessary .......... Therefore, we are satisfied that the question as to whether an order of detention can be passed against a person who is in detention or in jail, will always have to be determined in the circum- stances of each case. ", "The question which still remains to be considered is: can a person in jail custo- dy, like the petitioner, be served with an order of detention whilst he is in such custo- dy? ", "XXX XXX XXX XXX ", "We have already seen the logical process which must be followed by the authority in taking action under s. 3(1)(a) . The first stage in the process is to examine the material adduced against a person to show either from his conduct or his antecedent history that he has been acting in a prejudicial manner. If the said material appears satisfactory to the authority, then the authority has to consider whether it is likely that the said person would act in a prejudicial manner in future if he is not prevented from doing so by an order of detention. If this question is answered against the petitioner, then the detention order can be properly made. It is obvious that before an authority can legitimately come to the conclusion that the detention of the person is neces- ", "sary to prevent him from acting in a prejudi- cial manner, the authority has to be satisfied that if the person is not detained, he would act in a prejudicial manner and that inevita- bly postulates freedom of action to the said person at the relevant time. If a person is already in jail custody, how can it rationally be postulated that if he is not detained, he would act in a prejudicial manner? At the point of time when an order of detention is going to be served on a person, it must be patent that the said person would act prejudi- cially if he is not detained and that is a consideration which would be absent when the authority is dealing with a person already in detention. The satisfaction that it is neces- sary to detain a person for the purpose of preventing him from acting in a prejudicial manner is thus the basis of the order under s. 3(1)(a) , and this basis is clearly absent in the case of the petitioner. Therefore, we see no escape from the conclusion that the deten- ", "tion of the petitioner in the circumstances of this case, is not justified by s. 3(1)(a) and is outside its purview.\" (at pages 929-931 of SCR) (emphasis supplied) On the above principle also explained the decision of in ., A.I.R. 1953 Assam 97 in case (supra) the Government had decided to abandon the pending prosecution in public interest and action for detenu's release was taken. In anticipation of his release, the order of detention was passed and it was served after he was actually released. In these circumstances the detention order and its service was held valid. The test indicated by was duly satisfied. It is this principle and the test indicated therein which has to be applied in all such cases. Read in this manner the conclusion reached in each of the subsequent decisions satisfies this test. ", " , 3 SCC 490 the order of preventive detention passed while the detenu was in custody was upheld since there was a likelihood of his release on bail and resuming his desperate criminal activities prejudicial to the mainte- nance of public order. The facts of that case, therefore, justified making the detention order according to the test laid down by the Constitution Bench in case (supra). , 4 SCC 164 was a case in which the order of detention was passed while the detenu was in jail custody in a proceeding under section 151 read with section 117 . The detention order was upheld since the custody was obviously of a short duration and on the basis of the antecedent activities of the detenu in the proximate past, the detaining authority could reasonably reach its subjective satisfaction that the detenu had the tendency to act in a manner prejudicial to the maintenance of public order after his release on the termination of the security proceedings under the Code . , 2 SCC 43 the detention order was quashed because it did not give the slightest indication that the detaining authority was aware that the detenu was already in jail. The further question of the detaining authority's subjective satisfaction that it was necessary even then to make an order for preventing him from acting in a manner prejudicial to the security of the did not, therefore, arise. While dealing with this aspect the correct position was reiterated as under: ", "\"Preventive detention is resorted to, to thwart future action. If the detenu is already in jail charged with a serious offence, he is thereby prevented from acting in a manner prejudicial to the security of the . May be, in a given case there yet may be the need to order preventive detention of a person already in jail. But in such a situation the detaining authority must disclose awareness of the fact that the person against whom an order of preventive detention is being made is to the knowledge of the authority already in jail and yet for compelling reasons a preventive deten- tion order needs to be made. There is nothing to indicate the awareness of the detaining authority that detenu was already in jail and yet the impugned order is required to be made. This, in our opinion, clearly exhibits non- application of mind and would result in inval- idation of the order.\" ", "(at page 48) It is obvious that in this decision also the test indicated by in case (supra) was applied and the detention order was quashed on that basis. ", " , 3 SCR 939 the detention order was upheld even though the detenu was in jail custody on the date of passing of the detention order because the detention order showed that the detaining authority was alive to the fact and yet it was satisfied that if the detenu was enlarged on bail, which was quite likely, he would create problems of public order which necessitated his preventive detention. , 4 SCC 232 the detention order was passed when the detenu was in jail on the mere apprehension of likelihood of grant of bail on the basis of some stale grounds and a ground in respect of which the detenu had already been acquitted. It is obvious that even with the likelihood of grant of bail, the grounds of detention being stale or non-existent on the ground of the detenu's acquittal, they did not satisfy the required test of the detention order being based on valid grounds showing detenu's activities proximate in point of time to justify the detaining authority's satisfaction as reasona- ble. It was observed in passing that if the apprehension of the detaining authority about the likelihood of grant of bail was correct then it was open to challenge the bail order in a higher forum. This observation has accordingly to be read in the context of the facts in which it was made. , 4 SCC 416 the detention order was held to be invalid because the jail custody of the detenu at the time of service of the order as also the prospect of his release were not considered while making the detention order. It was held that the detention order was invalid on the ground of non-application of mind to these relevant factors even if the detention was otherwise justified. The decision in case (supra) was relied on and it was reiterated as under: ", "\"If a man is in custody and there is no immi- nent possibility of his being released, the power of preventive detention should not be exercised. In the instant case when the actual order of detention was served upon the detenu, the detenu was in jail. There is no indication that this factor or the question that the said detenu might be released or. that there was such a possibility of his release, was taken into consideration by the detaining authority properly and seriously before the service of the order. A bald statement is merely an ipse dixit or the officer. If there were cogent materials for thinking that the detenu might be released then these should have been made apparent.\" ", "(at pages 420- , 4 SCC 48 it was reiterated that detenu being already in jail at the time of passing detention order does not by itself vitiate the detention if the detaining authority is aware of this fact but even then it is satisfied about the necessity of preventive detention. The decision in case (supra) and the other earlier deci- ", "sions were referred while reaching this conclusion. The correct posi- tion was reiterated and summarised as under: ", "\"It is thus clear that the fact that the detenu is already in detention does not take away the jurisdiction of the detaining author- ity in making an order of preventive deten- tion. What is necessary in a case of that type is to satisfy the court when detention is challenged on that ground that the detaining authority was aware of the fact that the detenu was already in custody and yet he was subjectively satisfied that his order of detention became necessary. In the facts of the present case, there is sufficient material to show that .the detaining authority was aware of the fact that the petitioner was in custody when the order was made, yet he was satisfied that his preventive detention was necessary.\" ", "(at page 58) A recent decision on the point is , 1 SCC 436 in which also the settled principle is reiterated and it is pointed out that the ultimate decision depends on the facts of a partic- ", "ular case, the test to be applied remaining the same, as indicated in case (supra). It was also pointed out in this decision that the earlier decisions of in , (supra) and , (supra) do not run counter to the decision in case (supra). In each of these cases the conclusion was reached on the facts of the particular case, the test ap- plied being the same. Similarly, in this decision it was once again pointed out that the detenu being already in jail, the mere possibility of his release on bail was not enough for preventive detention unless there was material to justify the apprehension that the detenu would indulge in activities prejudicial to the maintenance of public order in case of his release on bail. The detention order in that case had been made merely on the ground that the detenu was trying to come out on bail and there was enough possibility of his being bailed out. It was, therefore, held that the mere possibility of his release on bail and a bald statement that the detenu would repeat his criminal activities was alone not sufficient to sustain the order of preventive detention in the absence of any material on the record to show that if released on bail he was likely to commit activ- ities prejudicial to the maintenance of public order. The detention order in that case was quashed on the ground that the requisite material to entertain such an apprehension reasonably was not present. The conclusion reached therein, on the facts and circumstances of the case, is as under: ", "919 ", "\"In the instant case, there was no material made apparent on record that the detenu, if released on bail, is likely to commit activi- ties prejudicial to the maintenance of public order. The detention order appears to have been made merely on the ground that the detenu is trying to come out on bail and there is enough possibility of being bailed out. We do not think that the order of detention could be justified only on that basis.\" ", "(at page 440) A review of the above decisions reaffirms the position which was settled by the decision of a Constitution Bench in case (supra). The conclusion about validity of the detention order in each case was reached on the facts of the particular case and the observations made in each of them have to be read in the context in which they were made. ", "None of the observations made in any subsequent case can be construed at variance with the principle indicated in case (supra) for the obvious reason that all subsequent decisions were by benches comprised on lesser number of Judges. We have dealt with this matter at some length because an attempt has been made for some time to construe some of the recent decisions as modifying the principle enunciated by in case (supra). ", "We may summarise and reiterate the settled principle. Subsisting custody of the detenu by itself does not invali- date an order of his preventive detention and the decision must depend on the facts of the particular case; preventive detention being necessary to prevent the detenu from acting in any manner prejudicial to the security of the or to the maintenance of public order etc. ordinarily it is not, needed when the detenu is already in custody; the detaining authority must show its awareness to the fact of subsisting custody of the detenu and take that factor into account while making the order; but, even so, if the detaining authority is reasonably satisfied on cogent material that there is likelihood of his release and in view of his an- tecedent activities which are proximate in point of time he must be detained in order to prevent him from indulging in such prejudicial activities, the detention order can be validly made even in anticipation to operate on his release. This appears to us, to be the correct legal position. Applying the above settled principle to the facts of the present case we have no doubt that the detention order, in the present case, must be quashed for this reason alone. The detention order read with its annexure indicates the detaining authority's awareness of the fact of detenu's jail custody at the time of the making of the detention order. However, there is no indica- tion therein that the detaining authority considered it likely that the detenu could be released on bail. In fact, the contents of the order, particularly, the above quoted para 18 show the satisfaction of the detaining authority that there was ample material to prove the detenu's complic- ity in the Bank dacoity including sharing of the booty inspite of absence of his name in the F.I.R. as one of the dacoits. On these facts, the order of detention passed in the present case on 7.9.1988 and its confirmation by the Government on 25.10.1988 is clearly invalid since the same was made when the detenu was already in jail custody for the offence of bank dacoity with no prospect of his release. It does not satisfy the test indicated by in case (supra). We hold the detention order to be invalid for this reason alone and express no opinion on merits about the grounds of detention. Consequently, the aforesaid order of detention dated 7.9.1988 passed by the Collector and District Magistrate, Madurai, and the order of confirmation dated 25.10.1988 by are quashed. The appeal and the writ petition are allowed. This, however, will not affect the detenu's custody in connection with the criminal case under section 397 I.P.C. We may also clarify that in case the detenu is released in the aforesaid criminal case, the question of his preventive detention under the Act on the above material may be reconsidered by the appropriate au- thority in accordance with law and this judgment shall not be construed as an impediment for that purpose. No costs. ", "R.N.J. Appeal and Petition allowed."], "relevant_candidates": ["0000043190", "0000225492", "0000358390", "0000488212", "0000516531", "0000889455", "0001316604", "0001596866", "0001894967", "0126394497"]} {"id": "0000333647", "text": ["JUDGMENT ", "1. The question in this appeal is whether 'an application under Order 21, Rule 95 for delivery of property by a decree-holder who has purchased the property in execution of his own decree is a step-in-aid of execution within the meaning of the expression in Article 182 , Clause 5 of the third column of the Limitation Act . The argument of Mr. for the appellant may be summarised under the following heads: ", "1. . (1900) ILR 24 Mad 185, which is a case in point, is opposed to the decisions before and after it. ", "2. The expression \" purchaser at a sale in execution of a decree \" in Article 138 of the Limitation Act is equally applicable to a decree-holder who purchases property in execution of his own decree as well as to a person who is a stranger to the decree, and therefore the former should be held to occupy the same position as the latter in regard to applications made after the sale. ", "3. When the judgment-debtor's property is purchased in sale by the judgment-creditor the decree is wholly or partially satisfied and thereafter there is no decree to be executed to the extent of the value of the property sold. ", "4. An application by a decree-holder can be a step-in-aid of execution only when an execution application is actually pending. Such an application cannot be said to be pending when a decree has been satisfied by the decree-holder purchasing the property of the judgment-debtor in sale. ", "2. (1900) ILR 24 Mad 185 it was held that an application by the decree-holder for delivery of the lands purchased by him in execution of his decree was a step-in-aid of execution as the execution was not complete so long as the purchaser had not secured possession! This case is directly in point and the authority of this case has not been challenged for quarter of a century. It would not be right to question the correctness of a decision, which has been accepted as laying down the law correctly for a number of years. The should follow the principle of Stare decisis in deciding points already decided by the . A decision of a Bench on a point of law should be held to be good till upsets it or takes a view opposed to it or of the High overrules it. As the authority of (1900) I L R 34 Mad 185 is said to be opposed to the decisions preceding it and the decisions subsequent to it, we proceed to consider whether it is so or not. ", "3. It is urged that the decisions in v. (1871) 6 MHCR 304 and C.M.A. No. 122 of 1895 are against the view of this. in (1900) ILR 24 Mad 185. In v. (1871) 6MHCR 304 the facts were: The defendant became the purchaser of the property sold in execution of a decree and the price for which the sale took place was sufficient to satisfy the decree. Instead of paying the purchase money into the defendant retained the whole sum with the assent and knowledge of the plaintiff upon the understanding that he should give a receipt to the for himself and on behalf of the plaintiff and afterwards should pay to the plaintiff his portion of the amount decreed. The defendant presented a petition to that effect to the and obtained the necessary certificates confirming the sale. The defendant having failed to pay the amount to the judgment-creditor which he was entitled, the latter brought a suit for the amount. It was contended that Section 11 of Act XXIII of 1861 corresponding to Section 47 of the present Code was a bar to the suit. The learned Judges held that the plaintiff's suit was not barred. There is no doubt an observation of the learned Judges that the execution proceedings were completely at an end and no subsequent application under the decree could have been entertained by the which executed it. But the observation of the learned Judges should be considered in connection with the facts of the case. It is not proper to rely upon one or two sentences in a judgment without reference to the facts of the case. In that case the decree-holder consented to take the amount of the decree from the auction-purchaser and allowed satisfaction of the decree to be entered up. The auction-purchaser not having paid the money he had to bring a, suit. The decree having been satisfied there was no decree to be executed. It would be the same thing if a decree-holder instead of executing the decree takes a fresh document from the judgment-debtor in satisfaction of the decree; and in such a case if the judgment-debtor fails to pay the amount under the document can the decree-holder execute the decree in satisfaction of which he took the document? It is an arrangement subsequent to the passing of the decree between the judgment-creditor and the judgment-debtor whereby the decree is satisfied, and if the subsequent agreement is not acted up to, the only remedy is to enforce the agreement. v. (1871) 6 MHCR 304, therefore, is not an authority for the contention that the decree-holder's application in this case is not a step-in-aid of execution, nor is it against the view of the learned Judges in (1900) ILR 24 Mad 185. In C.M.A. No. 122 of 1895, , J. sitting as a single Judge followed the decision in v. (1871) 6MHCR 304. But the facts of the case were not the same as those in (1900) ILR 24 Mad 185. In C.M.A. No. 122 of 1895 the facts were as follows: The 2nd defendant in the case objected to the delivery of possession on the ground that the purchaser got possession of the lands sold to him and that the should ascertain the price and position of the plots sold and direct delivery of possession. , J. held that such an application did not lie inasmuch as there had been a sale and the decree-holder was put in possession, and in the circumstances the execution came to an end because the sale itself was not questioned. It is difficult to see how this decision has any bearing on the question in (1900) ILR 24 Mad 185. It may be noted in passing that , J., who decided C.M.A. No. 122 of 1895 was one of the Judges who decided (1900) ILR 24 Mad 185. (1921) ILR 45 Mad 466 : 42 MLJ 303 is strongly relied upon as supporting the appellant's contention. In that case the judgment-debtor had made an application to the for entering up satisfaction. The decree-holder had objected to satisfaction of the decree being entered and filed a statement called counter-statement denying the receipt of the decree amount and asking that the petition should be dismissed. It was contended that the counter-statement was a step-in-aid of execution. and , JJ. held that the statement was not a step-in-aid of execution. The observation of , J., who delivered the judgment of the , that an application to be a step-in-aid of execution should be made in a pending execution application is strongly relied on, , J. differs from the observation of , J. in (1921) ILR 45 Mad 202 : 41 MLJ 374. With very great respect we are unable to agree with the view of , J. that an application in order to be a step-in-aid of execution should be made in a pending execution application. We shall deal with this point specifically under the fourth head. The facts of the case in (1921) ILR 45 Mad 466 : 42 MLJ 303 are distinguishable from the present. In that case the so-called counter-statement was not an application to have the decree executed or to enable the to do anything which would further the execution of the decree. As we have observed, the observations in a judgment should be considered in connection with the facts of the case. (1921) ILR 45 Mad 466 : 42 MLJ 303 is considered as an authority in favour of the appellant, we should respectfully dissent from it. But we hold that this is not an authority on the point now in question. (1924) 48 MLJ 506, to which one of us was a party, is also relied upon. In that case the mortgagee decree-holder applied for the payment out of a sum of money in which was not realised in execution of the decree. It \"was held that that application was not a step-in-aid of execution. The observation at page 509 that where an act of the plaintiff is not in furtherance of execution or in a pending execution it cannot be said to be a step-in-aid of execution does not help the appellant. It is clearly stated that the act must either be in furtherance of execution or in a pending execution and the passage cannot be twisted to mean that the application should be in a pending execution application. That case therefore is not against the decision in (1900) ILR 24 Mad 185. The decision in (1921) ILR 45 Mad 466 : 42 MLJ 303 was followed by another Bench of this in C.M. Section A. No. 120 of 1923 Since reported in (1926) 51 MLJ 480. The facts in that case were very similar to the facts in (1921) ILR 45 Mad 466 : 42 MLJ 303. There also the judgment-debtor applied to the to have satisfaction of the decree entered and the decree-holder put in a statement objecting to the satisfaction being entered. The held that the filing of such statement was not a step-in-aid of execution. The learned Judges, and , JJ., negatived the contention that an application in order to be a step-in-aid of execution should be made in a pending execution application. It is clear from the above discussion that there is no case so far as this High is concerned which is against (1900) ILR 24 Mad 185 or which questions its correctness. ", "4. The argument that the expression \"purchaser at a sale in execution of a decree \" in Article 138 covers the case of a judgment-creditor who purchases the property in execution of his own decree is untenable. It is well settled that a decree holder who purchases property in execution of his own decree cannot bring a suit for possession of the property purchased by him. Article 138 of the Limitation Act must be read along with the provisions of the Civil Procedure Code. Section 47 of the Civil Procedure Code bars a suit by a decree-holder for possession of the property purchased by him in execution of his own decree. v. (1902) ILR 26 MAD 740 : 13 MLJ 474, v. Hussain Sahib (1904) I L R 28 Mad 87 : 14 M L J 474 and v. (1890) ILR 13 Mad 504. To hold that an application like the present is not an application in execution of a decree would be tantamount to holding that the above decisions are incorrect for it has been consistently held that when the decree-holder applies for delivery of possession of the property purchased by him the should consider the objection and an appeal lies under Section 47 against the order made by the executing , and there is no warrant either in principle or in authority to hold a different view. ", "5. The contention that there is nothing to be executed after the decree-holder purchases the property in execution of the decree is denying the decree-holder a right to which he is entitled. The mere fact that he purchases the property of the judgment-debtor is not pro tanto a satisfaction of his decree. He is allowed to give credit for the value of the property purchased by him, but that alone would not be sufficient to satisfy the decree. Till he obtains possession it cannot be said that his decree is satisfied to the extent of the value of the property purchased. He has to apply to the for delivery of possession. The contention that the moment he buys the property of the judgment-debtor he ceases to be the decree-holder and assumes the capacity of a stranger purchaser is not supported by any authority. When the law prescribes a certain course to be pursued by the decree-holder even when he becomes the purchaser of the property it is not open to rely upon the expression used in Article 138 of the Limitation Act and to hold that his capacity as decree-holder ceases the moment he becomes the purchaser in sale. We hold that the execution is not complete till the decree-holder obtains possession of the property purchased by him in execution of his decree. ", "6. An act or an application in order to be a step-in-aid of execution need not be in a pending execution application. This point was decided so far back as (1882) I L R 5 Mad 141 and it is too late in the day to question the principle of that decision. In that case the judgment-creditor applied to the Court which passed the decree for a certificate that a copy of was necessary to enable him to obtain such copy from the Collector's Office and thereupon to execute the decree by attaching the land. It was held that that application was a step-in-aid of execution. , J., observed at page 143-- ", "I agree with the observations in (1877) I L R 3 Cal 235 (FB) that any application in furtherance of an application to put a decree into execution may be held to be an application to enforce the decree. ", "7. , J., concurred in the view. This case was followed in (1913) I L R 38 Mad 695 : 26 M L J 433. (1921) ILR 45 Mad 202 : 41 MLJ 374 Ramesam, J., observed: ", "In my opinion there is no warrant for the view that an application to take a step-in-aid of execution should be made in execution. ", "8. We entirely agree with the observation of , J. ", "9. When the decisions of our own are almost unanimous as regards a certain point it is unnecessary to consider what the Views of the other s are on that point. We may, however, remark that the views of the Bombay and Calcutta s are in accordance with our view. In Sadashiv bin (1913) I L R 38 Mad 695 : 26 M L J 433 the point before us was specifically decided and in (1926) 43 C L J 34.5 (FB) a Full Bench of the Calcutta held the same view as that in (1900) ILR 24 Mad 185. There are conflicting views in the decisions of the Allahabad . The Patna no doubt takes a different view. ", "10. On a careful consideration of the cases on the point we have no hesitation in answering the question in the affirmative. The appeal fails and is dismissed with costs."], "relevant_candidates": ["0000100905", "0000655449", "0000814469", "0000974296", "0001220020", "0001333573", "0001384071", "0001554481", "0001647861", "0001672668"]} {"id": "0000335698", "text": ["JUDGMENT , J. ", "1. This reference arises out of the estate duty proceedings consequent on the death of one S. M. M. Muthukaruppan Chettiar on October 19, 1961. He was a partner in a firm of money-lenders in Malaya called \"\". He made gifts during his lifetime as follows: ", "Date of original gift Amount out of the gifted property included u/s. 10 Name of donee Relationship Date of deed evidencing thetransaction 6-4-1938 Malayan Dollars 2,059 Married daughter 7-4-1955 12-4-1950 7,405 . ", "7-4-1955 13-4-1954 3,000 S. M. M. Dharma Kanakku (Trust Account) Charity 29-3-1955 10-6-1954 15,000 Krishnan Grandson 7-4-1955 ", "-do. ", "15,000 do. ", "do. ", "do. ", "15,000 Venkatachalam do. ", "do. ", "do. ", "15,000 do. ", "do. ", "6-2-1939 17,587 S. M. M. Subramanian Chettiar Son 7-4-1955 10-6-1954 6,250 96,301 ", "2. It is not clear as to when the deceased became a partner in . From the table given above it would be seen that one of the gifts is on April 6, 1938, another on February 6, 1939, a third one on April 12, 1950, and a fourth one on April 13, 1954. The firm was reconstituted with effect from 10th June, 1954. On that date his son joined the firm as a partner. Prior to the son joining the firm the deceased had 12 1/2% share in the firm. As a result of the son joining the firm, his share was reduced to 6 1/4 per cent, and the son got 6 1/4 per cent, in the firm. On that day four sums of 15,000 Malayan dollars were gifted to the four grandsons, as mentioned above, and another sum of 6,250 dollars was gifted to his son, who became a partner. ", "3. With reference to , who is the married daughter, and the gift in whose favour is referred to as item No. 1 in the above table, the position was as follows : ", "On 17th December, 1937, a house was purchased in No. 33, Jalan Deva Road, Sungaipattani, Malaya, for $ 4,941. The relevant consideration was debited to her account in the books of , Sungaipattani, Malaya. She received as gift on 6th April, 1938, a sum of 7,000 dollars as a result of which her account stood with a credit balance of $ 2,059. It is this amount which has been included in the assessment. It may be mentioned here that on 7th April, 1955, the deceased executed a deed of declaration saying that he gifted to her on several dates certain sums which had accumulated to $ 21,971.94 with interest, etc., and that she and her heirs were the absolute and free owners of the said sums. The deceased declared that he had no interest whatsoever in the said sum. All the other transactions fall into the same pattern, i.e., entries in books followed by the deed evidencing the transactions as shown in column (5) above. ", "4. To the gifted amounts, as lying in deposit with the aforesaid firm, were added interest and other receipts from time to time and there were also drawings for various purposes by the respective donees. We are concerned here with the gifted amounts totalling $ 96,301. ", "5. On the above facts, the Assistant Controller of Estate Duty considered the applicability of Section 10 of the Estate Duty Act. He took a sum of $ 1,03,708 as the amount with respect to which Section 10 was considered applicable. After referring to the gifts, he held that the donees invested the monies either wholly or in part in the firm of Messrs. , Sungaipattani, Malaya, in which the deceased was a partner till his death so that the investments by the donees, to the extent they had originated from the gifts referred to above, fell within the mischief of Section 10 of the Estate Duty Act. He referred in this connection to the decision of in v. Commissioner of Stamp Duties, AC 435 ; 37 ITR (ED) 89 ; 3 EDC 915 (PC). ", "6. The Appellate Controller reduced the addition to $ 96,301 as set out in the table given earlier here. He confirmed the applicability of Section 10 to the extent of the said amount. On further appeal, held as follows : ", "\"...... by reason of the donor being a partner in the firm in which the amounts gifted by him to the donees are deposited or invested, it cannot be said that the possession and enjoyment of the property taken under gift was not retained to the entire exclusion of the donor ...... the enjoyment contemplated under Section 10 of the Estate Duty Act, 1953, is enjoyment of the rights of the donees, and the enjoyment of the money after it was deposited is different from the enjoyment by the firm of the rights of the donees. As far as the donees are concerned, they did not share any of their right--right to income, right to assign, right to pledge--with the deceased partner of the firm. Moreover, a partner in the firm cannot be said to be the owner of any specific share in any partnership property and in that view he can neither transfer nor be the transferee of such specific share in the property. The deceased had no right or interest in and, therefore, could not be said to have enjoyed the deposit made by the donees in a firm in which he was a partner.\" ", "7. In coming to this conclusion it cited several decisions and observed that the matter had been dealt with by them in another order dated 31st October, 1967. The deleted the said sum of $ 96,301 from the assessment on the ground that Section 10 did not apply. ", "8. On the above facts, at the instance of the Controller of Estate Duty, the following question of law has been referred : ", "\"Whether, on the facts and in the circumstances of the case, the was right in law in holding that the gifted property of $ 96,301 was not hit by the provisions of Section 10 of the Estate Duty Act, 1953 ?\" ", "9. On behalf of the Controller, Mr. , learned counsel, submitted that in cases where Section 10 of the Estate Duty Act has to be applied, one has to first ascertain the subject-matter of the gift and find out whether the donor has been entirely excluded. In his submission, this is a case where there was a current account in favour of the deceased in the books of which had been debited and that the donees were operating the said account. He referred to the finding of the that the gifts were not\" conditioned upon the retention of the moneys of the firm\", that there was no documentary evidence to show the transfer of any actionable claim and that, in the absence of any such documentary evidence, it would only be a case of cash gift. His attempt was to show that where there was no transfer of an actionable claim as such in the manner contemplated by Section 130 of the Transfer of Property Act, and that the gift was only of cash, and that the subsequent investment of the amounts in the firm in which the deceased was a partner, brought the case within the scope of Section 10 of the Estate Duty Act. ", "10. For the taxpayer it was pointed out that there was no current account, that this was a case of a transfer of an actionable claim and that for the purpose of finding out whether there was any evidence in writing at the time of the transfer, the matter might, if necessary, be sent back to the . The learned counsel also attempted to show that the documents of 7th April, 1975, referred to already, were sufficient to support the case of a transfer of an actionable claim. ", "11. The document dated 7th April, 1955, is not contemporaneous with any of the transactions set out in the table given already. The declaration is long after the event and was obviously intended for some other purpose. We are, therefore, unable to proceed on the basis that the declarations of 7th April, 1955, in all cases except one, in any way affected the present position. We may, however, mention that the one document, namely, the one dated 29th March, 1955, in the case of a trust account is item No. 3 in the table. With reference to this trust, there was declaration made on 29th March, 1955. Even that declaration related to what happened earlier on 27th July, 1954, and that was by setting apart monies for performance of several charities. Thus, with reference to none of the transactions, is there any contemporaneous document in writing as contemplated by Section 130 of the Transfer of Property Act, to which any reference has been made before us. As the matter has been examined by the estate duty authorities and the at a time when they did not have the benefit of several decisions which were rendered subsequently, it is necessary to refer to the decisions so as to find out whether the property gifted was retained by the donee to the entire exclusion of the donor, which is the only point in dispute here. ", "12. The law on this point has been laid down by in two decisions which were appeals from this court and where the decisions of this court were confirmed. , 73 ITR 166, 169 (Mad.) the facts were as follows : ", "One was a partner of a firm called \"\" at Coimbatore. He asked the firm on 30th March, 1953, to transfer from his loan account with it a sum of Rs. 1,00,000 to the credit of each of his five sons in equal shares of Rs. 20,000 by opening separate accounts in their individual names in the firm's books. The assessability of this sum of Rs. 1,00,000 under Section 10 of the Estate Duty Act was the subject of dispute which reached this court. He had, in August 1953, transferred an immovable property to his two sons. The assessability of the value of that property was also the subject of dispute, but that is not relevant for our present purpose. With regard to the sum of Rs. 1,00,000 this court observed : ", "\"The donor had lent moneys to the firm and from out of the credit in his favour with the firm, he directed it in writing signed by him to transfer a sum of Rs. 20,000 to each of his sons by way of a gift.\" ", "13. After pointing out that this was an actionable claim and that the donor had directed the firm in effect to transfer part of his actionable claim in favour of his sons, and that the requirements of Section 130 of the Transfer of Property Act had been complied with, it was held : ", "\"Once we hold, as we do, that the subject-matter of the gift was not the sum of Rs. 1 lakh as money but an actionable claim of that value, it follows that the donor was completely excluded from it.\" ", "14. This decision was confirmed by on appeal in main discussion in 's judgment is with reference to the property that was transferred by the deceased in favour of his two sons under the document of August, 1953, and the same conclusion was applied with reference to the aforesaid amount of Rs. 1,00,000. ", "15. The other decision of this court is reported in , . In that case the deceased was the partner of a firm of money-lenders. He transferred by book adjustment in the accounts of the firm two sums totaling Rs. 1,29,924 to his sons and daughter apparently out of the profits earned and lying to his credit in the firm. With reference to the assessability of this sum under Section 10 of the Act, this court observed: ", "\"As the funds belonged to the donor, who was a partner, their repayment would be subject to the provisions of the partnership law. It is in this background we have to view what precisely was the subject-matter of the gift; was it, the two sums, free of any conditions or liabilities or subject to them ? We are inclined to think that, on a consideration of the entire facts, the book entries of the two amounts were made in effecting the transfer, the donor being fully alive to the fact that there would be no handing over of those two sums in cash to the donees and they would be available for the continued use of the partnership in the business and in that contingency, therefore, the amounts, while being used in the firm, would be looked after, managed and controlled by the father in his capacity as the managing partner.\" ", "16. The decisions of in v. Commissioner of Stamp Duties and v. Commissioner of Stamp Duties, [1934] AC 61; 2 EDC 462 (PC) were discussed and it was found that the case before this court came within the scope of the principle in 's case. This decision was taken on appeal to and the decision of is reported in [1973] 91 I.T.R. 1 ( ). held that the question of law was completely covered by the decision in the case of . ", "17. We may refer to two other cases to which one of us was a party. , 86 ITR 533 (Mad) the deceased, who was a partner in a firm carrying on business as bankers, transferred a sum of Rs. 1,00,000 each to the three minor grandsons of his deceased brother. In each case he drew a cheque against his account with the firm. The cheque was in favour of the firm itself. The account of the deceased was debited with the sum of Rs. 3,00,000 and simultaneously the three amounts of Rs. 1,00,000 each were credited to the accounts of the respective minors. One of the contentions taken before this court was that a partner was not a creditor of the firm in which he was a partner and that there was no jural relationship of a creditor and debtor between the partner and the firm. A decision of in , 64 ITR 373 (Ker) was referred to in this context. This court did not agree with the decision of and after referring to passages in Lindley on Partnership and to a decision in , ILR 32 Mad 76 it was pointed out that unless great injustice would be caused, courts would not refuse to recognize a claim for payment of the amount advanced by a partner to the firm and that even if no partial accounting could be ordered, the creditor-partner could file a suit for dissolution and general accounting and claim to be paid before the division of the assets as provided under Section 48 of the Partnership Act. It was pointed out that, in either case, viz., of partial accounting or a suit for dissolution, a partner had a right of an action. With reference to this aspect as to whether there could be a relationship of creditor and debtor between a firm and a partner, we may also refer to a Full Bench decision of five judges reported in , AIR 1928 Mad 923. In that case a distinction was made between the capital contributed by a partner and a separate loan advanced by the partner to the firm, and it was held that the interest paid to the partner was deductible in the assessment of the firm. That case arose prior to the introduction of Section I0(4)(b) into the Act of 1922. ", "18. In case the further question was whether the transfer had complied with the provisions of Section 130 of the Transfer of Property Act. It was held that, as the transaction had been effected by cheques, Section 137 of the Transfer of Property Act took the case out of Section 130 of that Act. It was, therefore, held that Section 10 was not applicable on the facts there. ", "19. The only other decision of this court to which reference need be made is not yet reported and it was rendered in T.C. No. 292 of 1968 ( , 98 ITR; 660 (Mad)). In that case the question related to a sum of Rs. 85,000. This sum was the total of two sums, viz., Rs. 60,000 and Rs. 25,000. As regards the gifts covered by the sum of Rs. 60,000 it was found that the deceased gifted Rs. 15,000 each to his four sons on 1st April, 1955. They were first invested in a proprietory concern and later withdrawn and invested in a firm in which the deceased was a partner. As the sum of Rs. 60,000 was gifted in cash by the deceased and as it was subsequently invested in a firm in which the deceased was a partner, this court held that Section 10 was applicable to it. As regards the sum of Rs. 25,000 the contention before was that the gifts were effected by making credit entries in favour of the assessee in the partnership accounts by making debit entries against the deceased partner. The further contention, with reference to the said sum, was that it was a gift \"shorn of the rights of the partnership to use the same\". Alternatively, it was contended that it should be treated as a transfer of \"actionable claim\". It was pointed out in the judgment that if the gift was made only by book entries in the firm's accounts, then, in view of the decision of in case and under the principle laid down in 's case, the gift had to be taken as shorn of the rights of the partnership to use the monies, in which case Section 10 could not stand attracted; but if it was a case of gift of cash, then Section 10 would apply. The was directed to determine the factual question as regards the sum of Rs. 25,000 in consequential proceedings to be taken under Section 64(6) of the Estate Duty Act. ", "20. We may also point out that in , 98 ITR 610 (Guj) had also to consider the scope of the applicability of Section 10 and have considered it in the light of the decision of in case. With reference to the sum credited to donees by book entries, applied the decision of case and held that Section 10 did not apply. With reference to the cases where the amounts were gifted outright by the deceased in favour of the donees who actually received the amounts gifted and thereafter deposited the amounts with the firm in which the deceased was a partner, it was found that the subject-matter of the gift was a sum of money which was given without reservation or qualification, and that, therefore, the gift was not liable to be taken as \"shorn of the rights of the partnership\". ", "21. The above discussion would go to show that we have to first ascertain the subject-matter of the gift. We have to see whether it was merely an existing balance in the shape of an actionable claim in which event the provisions of the Transfer of Property Act should have been adhered to. Then the transfer would be subject to the rights of the partnership. If, however, the amounts were gifted in cash, then, there will be nothing to show that the gifts are subject to any particular condition of user in the partnership in which the deceased was a partner. The question as to whether the relevant debits were made in the account of the deceased at the time when he was a partner so that what he had could be treated as an \"actionable claim\" has not been specifically gone into. If the debit was made in the books of the individual there would be no question of any \"actionable claim\". Therefore, the would have first to ascertain in the proceedings to follow under Section 64(6) the nature of or the subject-matter of the gift to see if it is an \"actionable claim\" or if it is a gift of cash. If it is a gift of cash, no further consideration is likely to arise as the authorities are clear on the point that the amount is liable to be taxed by applying Section 10 . If it was a transfer of \"actionable claim\", Section 10 would not apply. This question has to be considered as at the point of time when the gifts were made. ", "22. There is one other aspect which has to be examined as contended by the learned counsel for the Controller of Estate Duty. If it was a current account, then the contention of the learned counsel was that it could not be treated as an \"actionable claim\". \"Actionable claim\" has been defined in Section 3 of the Transfer of Property Act as follows : ", "\" 'Actionable claim ' means a claim to any debt, other than a debt secured by mortgage of immovable property or by hypothecation or pledge of movable property, or to any beneficial interest in movable property not in the possession, either actual or constructive, of the claimant, which the civil courts recognize as affording grounds for relief, whether such debt or beneficial interest be existent, accruing, conditional or contingent.\" ", "23. The \"actionable claim\" contemplated in the above definition is what is known to English law as a \"chose in action\". A \"chose\" is a chattel personal and is either in possession or in action. \"Choses in possession\" are movable chattels such as furniture, horses and generally all goods and merchandise. A \"chose in action\" is a right of proceeding in a court of law to procure the payment of a sum of money (example, a bill of exchange, a policy of insurance, an annuity or a debt) ", "24. An undivided share in a partnership is a chose in action Ex parte Fletcher : In re Bainbridge, [1878] 8 Ch D 218 (Ch D). As there were difficulties envisaged in applying the English law, the Indian legislature enacted the definition of an actionable claim as given above. In 's Transfer of Property Act (sixth edition), at page 807, it is observed : ", "\"A partner's right to sue for an account of a dissolved partnership is an actionable claim, being a beneficial interest in movable property not in possession.\" ", "25. In the case of a current account, it is a matter of agreement between the partnership and the partners that the partner is free to withdraw the amount. It is not, therefore, possible to say that it is a mere actionable claim. It is a debt due which was recognised by the partners as payable on demand and its recovery could be enforced against the firm without recourse to a suit for dissolution-- v. . The current account would thus stand out of the category of actionable claims. Any transfer of money from that account would be equivalent to gift of cash, as the donee will be free to deal with it in any manner and at any time he liked. In other words, the donor was not inhibited from demanding and getting back the amount during the currency of the partnership and the donee would have the same right. In such a case, there would be no condition applicable to the amount subject to which alone the transfer is effected. The transfer would thus be unconditional. We would, therefore, hold that, if the amount was a transfer from a current account as such, then it would stand in a distinct category and the applicability of Section 10 would follow. If, however, the transfer was from the capital account or loan account or any other general account to which profits are credited, then Section 10 cannot be applied. We would answer the question as indicated above. In passing the orders under Section 64(6) , the would be free to go into all the facts and consider the matter as if it was hearing the appeal by itself. We have in T. C. No. 107 of 1969 ( , 99 IJR 287 (Mad)) judgment in which was delivered on 20th November, 1974, indicated the scope of the powers of the in a matter which goes back to it as a result of the reference. We have held that the powers of the in such a matter are as ample as they were at the time when it dealt with an appeal for the first time. We are making these observations only to avoid any misapprehension about the scope of the enquiry which is to be conducted hereafter. ", "26. As neither party has succeeded, there will be no order as to costs."], "relevant_candidates": ["0000316164", "0000339307", "0000457764", "0000547228", "0000796476", "0000966068", "0001538869", "0001949249"]} {"id": "0000339039", "text": ["CASE NO.: Appeal (civil) 2720 of 2000 PETITIONER: DR. Vs. RESPONDENT: JAGDISH DATE OF JUDGMENT: 05/01/2001 BENCH: , R.C.Lahoti JUDGMENT: ", "L.....I.........T.......T.......T.......T.......T.......T..J This appeal by special leave is directed against an order of dated 4th February, 2000 rejecting applications (I.A. Nos. 2806/99 and 5957/99) filed by the appellant, the returned candidate, seeking rejection of an electio petition filed by the respondent challenging his election on various grounds contained in those applications. ", "In the elections to , held in 1998, the appellant was declared elected from Constituency No. 290, Maheshwar. The defeated candidate (Respondent herein) filed an election petition challenging his election n various ground of commission of corrupt practices, detailed in paragraphs 5 to 17 of the election petition. The election petition had been drawn-up in Hindi language. The affidavit filed in support of the election petition was also drawn up in Hindi anguage. The main objection projected by the appellant in IA 2806/99 to the maintainability of the election petition was that since the affidavit filed in support of allegations of corrupt practice was not drawn up in the manner prescribed by Section 83(1) of t e Representation of the People Act , 1951 (hereinafter referred to as 'the Act') read with Rule 94-A (hereinafter 'the Rules') in the prescribed form No.25, the defect was fatal and the election petition was liable to be dismissed under Section 86(1) of t e Act for non-compliance with the provisions of Section 83 of the Act. The precise objection raised in I.A. No.5957 of 1999 was to the effect that since election petition had been drawn-up in Hindi language and not English language the same was liable to be dismissed not having been drawn up in English language as required by Rule 2(b) of the Madhya Pradesh High Court Rules (hereinafter referred to as ' Rules'). Both applications were resisted by the election petitioner. Vide order dated 4th February, 2000 a learned Single Judge of rejected b th applications. ", "Mr. , learned senior counsel appearing for the appellant, submitted that there was material difference between the verification of the affidavit filed in support of the election petition and the verification of the election petition which rend red the election petition defective and thus liable to be dismissed. Elaborating the objection, it was submitted that in the affidavit dated 11th January, 1999 filed along with the election petition in paragraph KA, the election petitioner had verifie the facts relating to commission of corrupt practice stated in paragraphs 5 to 17 of the petition as true to his \"personal knowledge\" but in paragraph KHA of the same affidavit, the election petitioner had verified the contents of same \"information received by him\". It was submitted that this variation in verifying the same facts, both on \"personal knowledge\" and on \"information received\", being self-contradictory, rendered the affidavit as paragraphs 5 to 1 of the election petition as being based on \"no affidavit\" in the eye of law and such a defective affidavit could not be taken into account for trying allegations of corrupt practice in an election petition and, therefore, the election petition was liable to be dismissed in limine under Section 8 of the Act. A perusal of the record reveals that the election petitioner had later on, (possibly to meet the objection regarding defective affidavit) filed an additional affidavit in support of the allegations of corrupt practice verifying the facts stated in parag aphs 5 to 17 as based on his 'personal knowledge' and not on the basis of 'information received' from any other source. That affidavit appears to have been taken on record. According to learned counsel for the respondent on the other hand, none of the grounds raised by the appellant in both the applications could warrant dismissal of an election petition under Section 86 (1) of the Act and thus rightly dismi sed both the applications. We have given our thoughtful consideration to the submissions made at the bar and for what follows we are unable to persuade ourselves to agree with the submissions of learned counsel for the appellant. An election petition is liable to be dismissed in limine under Section 86(1) of the Act only if the election petition does not comply with either the provisions of ' Section 81 or Section 82 or Section 107 of the Act'. The requirement of filing an affi avit along with an election petition, in the prescribed form, in support of allegations of corrupt practice is contained in Section 83(1) of the Act. Thus an election petition is not liable to be dismissed in limine under Section 86 of the Act, for all ged non-compliance with provisions of Section 83(1) of the Act or of its proviso. What other consequences, if any, may follow from the an allegedly 'defective' affidavit, is to be judged at the trial of an election petition but Section 86(1) of the Ac in terms cannot be attracted to such a case. : a three Judge Bench of this Court specifically dealt with an issue concerning defects in the verification of an election petition as well as of defects in the affidavit accompanying an el ction petition wherein allegations of corrupt practice are made. After considering the provisions of Sections 83 and 86 of the Act, as also the requirements of Form No.25 prescribed by Rule 94-A of the Rules and relevant provisions of the Code of Civil rocedure , it was held : ", "\"From the text of the relevant provisions of the R.P. Act, Rule 94-A and Form 25 as well as Order 6 Rule 15 and Order 19 Rule 3 of the Code and the resume of the case law discussed above it clearly emerges (i) a defect in the verification, if any, can be cured (ii) it is not essential that the verification clause at the foot of the petition or the affidavit accompanying the same should disclose the grounds or sources of information in regard to the averments or allegations which are based on information elieved to be true (iii) if the respondent desires better particulars in regard to such averments or allegations, he may call for the same in which case the petitioner may be required to supply the same and (iv) the defect in the affidavit in the prescr bed Form 25 can be cured........\" ", "This judgment was followed by a Division Bench of this Court in : . We are in respectful agreement with the view expressed in case (supra) and in view of settled law the conclusion becomes irresistible that defect in verification of an affidavit is curable and does not merit dismissal of an election petition n limine under Section 86 (1) of the Act. The learned Single Judge of was, therefore, perfectly justified in dismissing I.A. No.2806 of 1999. ", "This now takes us to consideration of the objections raised in I.A. No.5957 of 1999 seeking dismissal of the election petition on the ground that the election petition and the affidavit filed in support thereof had been drawn-up in Hindi language and not in English language. The argument raised in and reiterated at the before us by Mr. is that Rule 2(b) of Rules provides that every election petition shall be written in English language and since the election peti ion filed by the respondent was written in Hindi and not English language, the same was liable to be dismissed for non-compliance with the said rule, in limine. ", " has framed Rules for trial of election petitions under Article 225 of the Constitution. Under Rule 9 thereof it is provided that the Rules of the High Court shall apply, in so far as they are not inconsistent with the Repre sentation of the People Act , 1951 or the rules, if any, made thereunder or the Civil Procedure Code in respect of all matters. The import of Rule 9 (supra) was considered in : and this Court opined: ", "\"Moreover, it appears to us that the provisions of Rule 9 of Rules regarding the election petitions framed by by reference to Rule 7 of Rules found in Chapter III r garding affidavits cannot be made use of for this purpose. The former set of rules are made under Article 225 of the Constitution and cannot make any substantive law and the rules themselves on a perusal of them would show that they relate merely to pro edural matters unlike rules made under Section 122 of the Code of Civil Procedure.\" (Emphasis supplied) Rejecting the preliminary objection to the maintainability of the election petition for non-compliance with the High Court Rules, in case this Court held : ", "\"Further more according to Section 86 of the Representation of People Act only petition which do not comply with the provision of Sections 81 or 82 or 117 are liable to be dismissed. We, therefore, over-rule the preliminary objection.\" ", "To appreciate the effect of non-compliance with Rule 2(b) of the High Court Rules, it is appropriate to notice some of the relevant statutory provisions at this stage. Rule 2 of the High Court Rules provides: ", "\"2. Every Election petitions shall be - ", "(a) typewritten or printed fairly and legibly on white foolscap size paper of reasonable quality, one side of the paper only being used, leaving a quarter margin on the left and at least 1/2 inches open space on the top and bottom of each sheet; (b) written in the English language, numbering separately the paragraph thereof; (c) couched in proper language, and in conformity with section 81 , 82 and 83 of the Representation of the People Act, 1951.\" ", " Article 329(b) lays down: ", "\"329. Bar to interference by courts in electoral matters - ", "(a) ... ... ... ", "(b) no election to either of Parliament or to the or either of the of a State shall be called in question except by an election petition presented to such authority and in such manner as may be provided for by or under any l w made by the appropriate .\" ", " Article 348 (1) provides : ", "\"348. Language to be used in and in the High Courts and for Acts, Bills, etc. (1) Notwithstanding anything in the foregoing provisions of this Part, until by law otherwise provides- ", "(a) all proceedings in and in every High Court .............................. ", "shall be in the English language.\" ", " Article 348(2) provides as follows:- ", "\"Notwithstanding anything in sub-clause (a) of clause ", "(l), the Governor of a may, with the previous consent of the President, authorise the use of the Hindi language, or any other language used for any official purposes of the , in proceedings in having its principal seat in that : ", "Provided that nothing in this clause shall apply to any judgment, decree or order passed or made by such High Court. ", "Rules framed by relating to trial of election petitions are only procedural in nature and do not constitute \"substantive law\". Those Rules have to be read alongwith other statutory provisions to appreciate the consequences of non-complia nce with Rules. Article 329(b) mandates that no election to either or to either can be called in question except through an election petition presented to such authority and in such mann r as is provided for by or under any law made by the legislature. Section 81 of the Act deals with the presentation of an election petition while Section 82 deals with parties to the election petition and Section 83 with contents of such a petition. ", " Article 348 expressly deals with the language to be used in and and lays down in Article 348 (1) (a) that all proceedings in and shall be in the English language. Article 348(2) (supra ), however, carves out an exception to the above general rule. ", "The non-abstante clause with which Article 348(2) opens, unmistakably shows that the Governor of a State, with the previous consent of the President may authorize the use of Hindi or any other language in proceedings in having its princip al seat in that State, save and except that \"judgment, decree or order passed or made by such High Court\", shall be in the English language as required by Article 348(1). By a Notification dated 18th September, 1971 issued by the Governor of Madhya Pradesh, in exercise of the powers conferred by clause (2) of Article 348 of the Constitution of India, with the previous consent of the President of India, authorised the use f Hindi language in all proceedings of other than for drawing up decrees, orders and judgments of , subject to certain conditions. Under the said Notification, appeals, petitions etc. could thus, be presented in the High Cou t of Madhya Pradesh drawn-up in the Hindi language, notwithstanding the provisions of High Court Rules. Rule 2(b) of Rules cannot be so construed as to render the constitutional provisions contained in Article 348(2) as 'meaningless'. ule 2(b) of Rules has to be read along with the Notification issued by the Governor on 18th September, 1971 under Article 348(2) of the Constitution and when so construed, it follows that an election petition may be filed in Hindi language and it cannot be dismissed at the threshold under Section 86 of the Act for alleged non-compliance with Rule 2(b) of Rules. The question whether an election petition drawn up in Hindi language is maintainable or not came up for consideration before a learned Single Judge of of Madhya Pradesh in Election Petition No. 9 of 1980 titled Devilal s/o. Shriram Khada vs. and others. While rejecting the challenge to the maintainability of the election petition drawn up in Hindi language, it was said :- ", "\"Now it is true that Rule 2(b) of the aforesaid Rules does provide that every election petition shall be written in the English language. But in the absence of any provision in the Act or the Rules made thereunder, non compliance with Rule 2(b) of the a oresaid Rules cannot be a ground for dismissal of the petition under Section 86 of the Act.\" ", "A contrary view was, however, expressed by another Single Judge of that High Court in . In this case it was held that an election petition filed in Hindi language being violative of Rule 2(b) of the Ru es, relating to filing of election petitions, was not maintainable and was liable to be dismissed under Section 86 of the Act. The learned Single Judge opined : ", "\"The Special Rules framed by , in the circumstances, taking into account the implications arising under Article 329(b) of the Constitution of India read with Section 80 of the Representation of the People Act, 1951, relating to election pet tions prescribing the manner for presentation of the election petition by necessary implication stand clothed with such a statutory character which could not be deemed to have been affected by an order relating to authorization contemplated under Article 348 (2) of the Constitution of India so as to take away statutory rigour of the Rules prescribing a requirement of an election petition to be written in English language, numbering separately the paragraphs thereof as provided in rule 2 of the aforesaid ules relating to election petitions.\" ", "The interpretation placed on rule 2 of Rules, giving it almost primacy over Article 348(2) of the Constitution, in case to our mind is fallacious. The learned single Judge appears to have lost sight of the position that R les framed by in exercise of powers under Article 225 of the Constitution of India are only rules of procedure and do not constitute substantive law and those rules cannot effect the import of constitutional provisions contained in Articl 348(2) of the Constitution. The high pedestal on which Rule 2(b) of Rules has been placed in case, not only violates clear constitutional provisions but also introduces a clause in Section 86 of the Act which does not xist. The entire approach to consideration of the effect of the notification issued under Article 348(2) appears to be erroneous. That apart, the defect of not fling an election petition in accordance with Rule 2(b) of the Rules is not one of the defec s which falls either under Sections 81 , 82 of 117 of the Act so as to attract the rigour of Section 86 of the Act as rightly held in 's case (supra). Whether any other consequences may follow on account of the alleged defects would depend upon ther factors to be determined at the trial of the election petition but to hold that Section 86(1) of the Act would be attracted for non-compliance with Rule 2(b) of Rules is not correct. The learned Single Judge of was rig t in rejecting application, I.A. No. 5957 of 1999 and holding that an election petition filed by the respondent could not be dismissed under Section 86(1) of the Act for alleged non-compliance with Rule 2(b) of Rules relating to presentati n of election petitions. ", "It appears that the earlier judgment of the learned Single Judge in 's case (supra) was brought to the notice of the learned Single Judge hearing case. The learned Judge in the later case noticed the identical nature of the two ca ses, but did not share the view of the in 's case and a contrary view was expressed. It was observed: \"It may be noticed that although like cases should be decided alike but this principle is not in absolute rule nor of universal application. It does admit exceptions. Where there is no discussion regarding applicability of the relevant statutory provis ons and the decision has been reached by a in the absence of knowledge of a decision binding on it or a statute and in either case it is shown that had the had the said material before it, it must have reached a contrary decision, it is clear y a case of a decision per incuriam which has no binding effect. This principle does not extend to a case where if different arguments had been placed before the said or a different material had been placed before it, it might have reached a diffe ent conclusion.\" (Emphasis supplied) We are unable to appreciate as to how the judgment in 's case could be styled as \"per incuriam\". That apart, the ground on which the judgment in 's case (supra) has been distinguished does not stand to reason. We have not been able to appreciate the logic of the observations of the learned Single Judge in 's case (supra) that the cont oversy in case was \"quite different\" and not confined to the applicability of section 86 of the Act alone. A reference to paragraph 41 of the judgment in case dismissing the election petition in limine, brings out the fal acy of the \"difference\", as perceived by the learned Single Judge. It was observed : ", "\"In view of what has been indicated hereinabove, I have no hesitation in holding that the present election petition as framed is not at all entertainable. Since even the limitation for filing a fresh election petition in accordance with law and in the anner prescribed has also run out, it is not possible or permissible to permit the petitioner to remove the defect in the presentation of the election petition, the present election petition in the circumstances is not at all triable.\" ", "(Emphasis supplied) How could it then be said that the controversy in the two cases was, \"different\" is not understandable ? We are of the considered opinion that the view expressed in 's case was correct view of law and the contrary view expressed in case does not lay down correct law. As the learned Single Judge was not in agreement with the view expressed in 's case, it would have been proper, to maintain judicial discipline, to refer the matter to a larger rather than to take a different view. We note it with regret an d distress that the said course was not followed. It is well settled that if a of coordinate jurisdiction disagrees with another of coordinate jurisdiction whether on the basis of \"different arguments\" or otherwise, on a question of law, it s appropriate that the matter be referred to a larger for resolution of the issue rather than to leave two conflicting judgments to operate creating confusion. It is not proper to sacrifice certainty of law. Judicial decorum, no less than legal p opriety forms the basis of judicial procedure and it must be respected at all costs. Before parting with this aspect of the case, we wish to recall what was opined in . : 3 SCR 578 : \"...If one thing is more necessary in law than any other thing, it is the quality of certainty. That quality would totally disappear if judges of co-ordinate jurisdiction in start overruling one another's decision. If one division bench of is unable to distinguish a previous decision of another division bench, and holding the view that the earlier decision is wrong, itself gives effect to that view the result would be utter confusion. The position would be equally bad where a Judge sitting singly in is of opinion that the previous decision of another single Judge on a question of law is wrong and gives effect to that view instead of referring the matter to a larger . In such a case lawyers would not know h w to advise their clients and all courts subordinate to would find themselves in an embarrassing position of having to choose between dissentient judgments of their own ...\" ", "These salutary principles appear to have been over looked by the learned Judge deciding case. Thus, for what we have said above, we are not persuaded to take a view different than the one taken by in the present case. This appeal has no merits. It fails and is accordingly dismissed but with no order as to costs. ", "We request to expeditiously dispose of the election petition. .........................CJI."], "relevant_candidates": ["0000488401", "0000637817", "0001055762", "0001656643", "0001999403"]} {"id": "0000349744", "text": ["JUDGMENT , Kt., C.J. ", "1. These are two cross-appeals from judgments of the First Class Subordinate Judge of . In the suit from which Appeal No. 477 is brought, the plaintiffs are claiming a declaration that they are permanent tenants of the suit land, whilst Appeal No. 471 is an appeal in a suit brought by the landlord, defendant in the first suit, claiming possession of the suit property on the ground that the plaintiffs are annual tenants. So that the real point in both appeals is whether the plaintiffs in the first suit are permanent tenants op annual tenants. ", "2. For the purposes of determining the plaintiffs' title, the suit land is divisible into two parts, the claim of the plaintiffs being different in respect of those two parts. There is, first, the property shown on the exhibited plan within the parallelogram A B C D, which I will refer to as the \"A property,\" and then there is the rest of the suit property, partly to the north and partly to the south of the A property, which I will refer to as the \"B property\". The A property .consists of six bighas, and the B property of twenty-four bighas. With regard to the A property the relevant facts are these. In the year 1815 the whole of the suit property, so far as we know, was granted by the desai of Nippani to the predecessors-in-title of the defendant (I am referring to the defendant in the first suit, i. e. the landlord). The actual sanad is not produced, although the defendant offered to produce it if called for, and therefore we do not know whether the land was actually in the occupation of the plaintiffs or any body else in 1815. That sanad applies to both the lands A and B, but the next four documents to which I will refer relate only to the A land. The first of those documents is exhibit 182, which is the rent-roll for the year 1837 of the desai of Nippani, showing the cultivators of various lands belonging to him. Amongst those cultivators is included the name of as making payment of Rs. 19-14-9 in respect of land in Sankeshvar, which is the village where the land in suit is situated. Then the next document is exhibit 180, which is a similar rent-roll in respect of the year 1841, and that shows that the cultivator of land in Sankeshvar was a man named , and the rent he is shown as paying is Rs. 100. Then the next document is exhibit 124, which is a letter written in the year 1844 by the to the desai of Nippani relating to a quarrel relating to land of the desai in Sankeshvar. It is said that that letter shows that the land in 1844 was in the possession of the defendant's predecessors-in-title, but we only have the statement in that letter of the , and we have not got any answer to that letter. The next document which I should refer to is the document marked exhibit 16 (1), of the year 1848, That purports to be an agreement by the predecessors-in-title of the defendant in favour of the predecessors of the plaintiffs, and it recognises the plaintiffs as being in possession of six bighas of land at Sankeshvar, and agrees to their spending money by constructing a well, and grants them the land for a term of twenty-one years at a rent of Rs. 22 a year, and thereafter, at the rent of Rs. 30 a year, The plaintiffs rely on that document, but the learned Judge held that it was not proved, and in my opinion, the learned Judge's decision on that point was correct. It was sought to prove the document in certain revenue proceedings, to which I will refer presently, which contemned in, 1888, The witness who was called in those proceedings to prove this document stated that he knew the handwriting it was in, but the document was not signed, and that being so, I think the learned Judge was right in holding that it was not proved. We have, therefore, no actual documentary evidence as to the plaintiffs' title to the A land at any rate before about 1855, and the plaintiffs rely on Section 83 of the Bombay Land Revenue Code as raising in their favour a presumption of permanent tenancy. That section provides : ", ".. where by reason of the antiquity of a tenancy, no satisfactory evidence of its commencement is forthcoming, and there is not any such evidence of the period of its intended duration, if any, agreed upon between the landlord and tenant, or those under whom they respectively claim title, or any usage of the locality as to duration of such tenancy, it shall, as against the immediate landlord of the tenant, be presumed to be co-extensive with the duration of the tenure of such landlord and of those who derive title under him. ", "The plaintiffs say that by reason of the antiquity of this tenancy there is no satisfactory evidence as to its commencement or as to its duration, and the answer of the defendant is that the three documents to which I have referred, the documents of 1837, 1841 and 1844, establish this, that in those respective yelars somebody other than the plaintiffs was in possession of the property, and therefore, it is said, the plaintiffs' possession must have started after 1844, somewhere between 1844 and 1851. It has been held by this Court in a good many cases that Section 83 of the Bombay Land Revenue Code, in referring: to the absence of satisfactory, evidence of the commencement of a tenancy, does not mean that there must be satisfactory evidence as to the exact date of commencement, that is, the day on which the tenancy commenced, but that it is sufficient if the evidence shows that the tenancy must have commenced in. a particular period ; and the degree of elasticity permissible in relation to the period has been the subject-matter of a good many decisions. Here it is-suggested by the defendant that as the period is fixed between 1844 and 1851, there is sufficient evidence as to the commencement. I doubt that proposition, but in any case, to my mind, the documents relied on by the defendant do> not afford any satisfactory evidence that the plaintiffs were not in possession before 1844 or 1837. There is, as I have pointed out, no definite evidence that the plaintiffs were not in possession before 1815, because we have not seen the actual . The rent-rolls of the in 1837 and 1841, although they refer to land in Sankeshvar, and although it has been admitted that the owned no land in that village except the suit land, do not prove that the occupiers referred to in that rent-roll were in occupation of all the 's land in Sankeshvar. It was found in 1857 in the revenue suit hereafter referred to that property A. had been in the enjoyment of the plaintiffs' predecessors from a very old time, and that the occupation of that land and property B had become severed by about 1851. There was no particular reason why the 's rent-roll should have referred to the names of the cultivators of land, or to the rent they paid, where the land had been granted out to the predecessors of the defendant at a fixed rent of Rs. 100, The letter from the , exhibit 124, is also, to my mind, a very weak piece of evidence. It is merely a statement of what the was told, and we have not got the answer to tee letter. Therefore, I am not prepared to say that on those documents I consider that there is any satisfactory evidence as to the commencement of the plaintiffs' title in respect of the A property, or as to the duration of their tenancy. Indeed, if exhibit 16 (1) be not proved, ] .there is no evidence at all as to the duration of the tenancy. Therefore, to my mind, the presumption under Section 83 arises. There is nothing in the future \u00a3 history of the land to affect that presumption. That future history is bound up with property B, and I will refer to it in connection with the other part of the case. ", "3. Now coming to property B, the plaintiffs' contention was that they entered into possession of that land as permanent tenants in the year 1851 on the terms of an agreement, which is exhibit 16 (2). The learned Judge held that that exhibits was not proved. It appears that in the year 1855 a suit was commenced in by the landlords of this property against the tenants for possession, and in those proceedings this document, exhibit 16 (2), was put in, and a witness was called, who said that he had been a clerk employed by the landlord, that the document was in his handwriting, and that the last words \"these are the blessings\" were in the handwriting of the landlord. Assuming that the evidence of that witness can be let in under Section 33 of the Indian Evidence Act, I agree with the learned Judge in thinking that this document is not proved. The important thing about it is that it was never signed, and therefore the document written out by the witness was really nothing more than a draft, possibly a fair copy. It is to be noticed, too, that in the revenue proceedings the refused to accept the document. Assuming that the document, exhibit 16 (2), is not proved, then the plaintiffs put their case as to the B land in this way. They say that admittedly their title to the B land commenced in 1851, even if they do not prove the actual agreement under which it arose. In these revenue proceedings, started in 1855, the plaintiffs asserted that they were permanent tenants, no doubt relying on exhibit 16 (2), but at any rate there was an assertion that they were permanent tenants. From 1851 both property A and property B have been held together at one rent, and if there is a presumption that the plaintiffs' interest in property A is that of a permanent tenant, the mixing up of that land with property B suggests a similar interest in property B. A uniform rent was paid for both properties down to the year 1879 at the rate of Rs. 127 a year, and thereafter it was enhanced. The plaintiffs' case is that it was never enhanced beyond a figure recognised by local usage, and therefore the enhancement would come within the provisions of Section 83 of the Bombay Land Revenue Code, and would not be inconsistent with permanent tenancy. It is said, further, that in the revenue proceedings of 1855 the Collector refused to make an order for possession, and referred the landlord to a civil suit, and for upwards of sixty years no steps whatever were taken to file any suit or challenge the alleged title of the plaintiffs. It is contended, therefore, that the assertion by the tenants of a permanent tenancy, acquiesced in by the landlord for sixty years, and confirmed by acts of the tenant, such as spending money on the property and paying a much smaller rent than the value of the property warranted, leads to a presumption of permanent tenancy, apart from Section 83 of the Bombay Land Revenue Code, and further, that the landlord having acquiesced in that assertion, his title is barred under Article 144 of the Indian Limitation Act . It is of course admitted that the presumption under Section 83 of the Bombay Land Revenue Code does not arise in the case of the B property, because the date of the commencement of the title is known. To the plaintiffs' case the defendant answers that the only assertion of a permanent title was based on exhibit 16 (2),, which is not proved, and .further, that even if that document was proved, it does not constitute a permanent tenancy, and further again, if it does constitute a permanent tenancy, it also fixes a permanent rent, and subsequent enhancement of the rent is inconsistent with title based on a document fixing the rent. ", "4. The real question as to property B is one of law, namely, whether when a tenant in occupation of land paying an annual rent asserts at the commencement of his tenancy that he is a permanent tenant, and that alleged claim, although disputed by the landlord, is not challenged by a suit for more than sixty years, the position results in law in the acquisition of a permanent tenancy either under some presumption apart from that contained in Section 83 of the Bombay Land Revenue Code, or under the Indian Limitation Act . On that point of law there are some relevant decisions of . There is, first of all, the case of v. (1923) L.R. 50 I.A. 202 in which it was laid down by their Lordships of that they were unable to affirm as a general proposition of law that \"a person who is, in fact, in possession of land under a tenancy or occupancy title can, by a mere assertion in a judicial proceeding and the lapse of six or twelve years without that assertion having been successfully challenged, obtain a title as an under-proprietor to the lands.\" I think that the decision comes to this, that where a person is given possession of land as a tenant, the mere fact that he asserts that the tenancy is of a particular kind will not by the lapse of time convert the tenancy into one of that kind. Whether a tenancy is permanent or not must depend on the facts of the case and the agreement between the parties and not on mere assertions. In my opinion that principle applies to the present case, Then went rather further in (1923) L.R 51 I.A. 83, where they definitely held that the defendants being tenants could not obtain a right of permanent occupancy by prescription. But Mr. on behalf of the appellants relies on another decision of the (1928) L.R. 55 I.A. 212 : S.C. 30 Bom. L.R. 1361. In that case lands were held under a mukarrari agreement and the mukarrari tenant died. The Court held that the tenancy was a tenancy for life which terminated on the death of the mukarraridar, but the mukarraridar's descendents alleged that it was a permanent tenancy and they remained in occupation and continued to pay rent asserting that they were permanent tenants. On the other hand, the landlord always denied their tenancy, and it was held by , and affirmed by , that the landlord's suit for possession was barred, and the defence set up by the defendants that they were permanent tenants by reason of their occupation and assertion of that right, was accepted. But their Lordships of , after referring to the earlier decision of Madhavrao Woman Saundatgekar v. Raghunath Venhatesh Deshpande (1923) L.R. 50 I.A. 255 : S.C. 25 Bom. L.R. 1005, and , and to other cases, say that it is not necessary to consider those cases in detail, because the facts of that case did not bring it within the rulings in question. Then they say (p. 223) : \"In this case the evidence goes to j show that after the expiration of the lease for lives the plaintiff's predecessor-in-title did not, in fact, claim to be the landlord, he did not admit any tenancy \u00a3 on the part of the defendants or their predecessors, and he did not, in fact, allow the defendants or their predecessors to be in possession as tenants\". No doubt the landlord had accepted rent annually from the successors of the tenant. But the view their Lordships took was that the legal result which would normally follow from that course of conduct, namely, the creation of a tenancy between the landlord and the persons who paid the rent was prevented by the fact that the landlord had given receipts for the rent in the name of the deceased mukarraridar. I find it myself rather difficult to, follow how the legal consequences resulting from the acts of the parties in the payment and acceptance of rent could be affected by the receipt for rent having been given in the name of somebody who was dead and had not paid it. But at any rate the whole basis of that decision was that the landlord had never recognised the defendants as tenants, and therefore their possession had always been adverse to him. That is not the position here. Assuming that the tenants have asserted that they were permanent tenants, that alleged title has never been in any way recognised by the landlord, and he has always accepted rent every year, and given a receipt in no special form to the persons who paid the rent, and thereby he has in my opinion recognised those persons as tenants. If they are not permanent tenants, they must, I apprehend, be annual tenants, and it cannot be said, therefore, that their possession has ever been adverse to the landlord. That being so, in my opinion, the learned Judge was right in holding that the plaintiffs had failed to establish a permanent tenancy in respect of the B property. But I think that his judgment was wrong in respect of the A property, and that the plaintiffs do establish a permanent tenancy as to that. ", "5. With regard to the other Appeal, No. 471, certain objections are taken to the landlord's suit, which, as I have said, is a suit for possession. It is based on a notice to quit expiring in April 1922, and I am clearly of opinion that that notice to quit was waived by a subsequent notice to quit given on September 26, 1925, which is exhibit 172 in the case. The latter notice to quit in terms recognised the defendants as being annual tenants, and paying an annual rent, and the recognition of the tenancy amounts, in my opinion, to-a waiver of the earlier notice to quit. Therefore the plaintiff's suit, in my opinion, was bad, but Mr. has asked for leave to amend his claim, by basing his right to possession on the notice of September 26, 1925f exhibit 172, and on terms as to costs we are prepared to give that leave. The notice is also challenged as being an insufficient notice to quit. It is said that it is really a notice to enhance rent, or at any rate only a contingent notice to quit; but as I read the document, I think it is a notice to quit on March 31. 1926\" accompanied by an offer to abandon that notice if the tenant would agree to pay a further enhanced rent. Coupling that offer with the notice does not, in my opinion, invalidate the notice. Then it is said that the notice was not served upon defendants Nos. 3, 4 and 5. In the case of defendant No. 3, admittedly it was not served. In the case of defendants Nos. 4 and 5 a registered letter containing the notice was sent to them duly addressed, and service is alleged to have been refused. In fact the refusal was not proved, as the postman who took the letter and brought it back was not called. But in any case, even if the refusal had been proved, I should not be prepared to hold that a registered letter tendered to the addressee and refused and brought back unopened, was well-served. There are, I know, some authorities in this Court to the contrary, but it seems to me impossible to say that a letter has been served so as to bring the contents to the notice of the person to whom the letter is addressed, if the agent for service states that in fact the notice was not served, although the reason may have been that the addressee declined to accept it. One cannot assume that because an addressee declines to accept a particular sealed envelope he .has guessed correctly as to its contents. Many people in this country make a practice of always refusing to accept registered letters, a practice based, I presume, on their experience that such documents usually contain something unpleasant. So that, in my opinion, it is clear that this notice was not served on three of the defendants. But it was served on the other defendants, and the defendants are joint tenants of the land, and I think we can follow the ruling of in the case of (1918) I.L.R. 46 Cal. 458 : S.C. 21 Bom. L.R. 522, P.C., and decide that service of a notice to quit on one of several joint holders affords prima facie evidence that it has reached the rest. The defendants in question did not go into the witness box to deny that they had received the notice, and therefore the prima facie presumption must prevail. I think, therefore, that subject to the defendant's amending his plaint, and with the necessary variation in the order as to mesne profits, Appeal No. 471 must be dismissed as to property B. ", ", ", "6. I concur. With regard to the grants of 1848 and 1851 on which the appellants rely for the creation of permanent tenancy, I think the lower Court was right in holding that they were not proved. They purport to be only uncertified copies, and are not signed by the executant. It is urged that there are certain words, viz. 'blessings', in these two grants which are deposed to in a previous deposition as having been written by the executant. But it appears from certain receipts in this case, for instance, exhibits 91, 92 and others that the executant did affix his signatures to documents, and that being so, it is not shown how it is that in these grants, if they are executed by , he has not put his signature but has only written the words, 'blessings'. Besides, in the revenue dispute before the Collector, these two documents, which were relied upon, have been held not proved and it is stated that thereafter they remained in the Collector's record, and are sought to be produced and proved now, mainly by the deposition of a Witness in former revenue proceedings, who says that some of the writings of these two grants are in the handwriting of . But that is not sufficient for the proof of these two documents. Even assuming, however, that they are proved, I doubt very much if these two documents would create permanent tenancy at all. At the most they might create a tenancy for the life of the persons in whose favour the grants are made. Therefore these two documents being out of question, the appellants have to rely on Section 83 of the Bombay Land Revenue Code for alleging permanent tenancy. Now with respect to the land of six bighas, the lower Court has held that the origin of the defendants' title to possession of this land is known as having commenced some time between 1844 and 1851, and reliance is placed on three exhibits, 180, 182 and 124, I agree that it cannot be said that the commencement of the tenancy is proved satisfactorily within the meaning of that expression in Section 83 by these three documents. The respondents' ancestors' names are not shown in documents, exhibits 180 and 182, and exhibit 124 is simply a letter by the with regard to some dispute raised by one , who seems to be a cultivator on that land. If these three documents go out of the question, then the only thing on which we have to go upon is the statement made in the judgment given by the Deputy Collector in 1857, exhibit 84. That would, however, show that with regard to the A land, he was of opinion that the tenant's ancestors were on that land from very ancient times, and in that judgment a clear distinction is made between the A land and the rest of it, and it is stated there that with regard to the A land the tenant's ancestors were in possession from ancient times, and with regard to the entire land, that is, A and B, they were in possession since four or five years. Therefore, on this documentary evidence, it would appear that the antiquity of the tenancy having been proved by the tenants, the landlord has not sufficiently and satisfactorily proved that the tenancy commenced at any particular period. At the most it can be said that the tenancy might have commenced between 1815, from which year the landlord's tenure began, and 1851. But that is - too long and indefinite a period within which it can be said that the tenancy must have commenced at a certain date. Although according to some decisions of this Court the period of twenty years is regarded as one from which it can be shown that the commencement of a tenancy is satisfactorily begun, I think each case must depend upon the evidence produced in it, and I am satisfied that with regard to the evidence produced for the A land, the landlord has not proved that the tenancy with regard to that land commenced at any particular time. The result, therefore, will be that the tenants will be presumed to be permanent tenants, even though there has been some increase in the rent. That is so, because the rent that has been paid by the tenants to the landlord is not simply a rent for the A land, but for the aggregate of the A and B lands, i.e. Rs, 127. ", "7. Then coming to the B land, it is conceded that the tenants' occupation of this land began at a definite time, viz., 1851, and therefore the appellants cannot invoke the aid of Section 83 for the purpose of proving permanent tenancy. But it has been strongly urged on behalf of the appellants that although they did not get rights of permanent tenancy either by their grant or under Section 83 , they acquired them by adverse possession, and for that reliance has been placed upon a deposition of one of the ancestors of the present appellants, , who deposed in previous revenue proceedings that they were holding the lands as permanent tenants by virtue of the grant of 1851; It is urged that since that assertion the tenants have been holding the land claiming to be permanent tenants, and that the landlord has accepted the rent, and has not disputed their status as permanent tenants. Now in order that a person can acquire rights by adverse possession, he must intend to do so in a manner which must be clear , and unambiguous. Here, we are not concerned with the acquisition of rights as absolute owner, but acquisition of rights as a limited owner. In fact it appears that between 1851, in which, according to the appellants, their possession began, and 1855, when the first assertion was made, they have given rent to the landlord for which there are receipts. That would show that they were in possession of the land as tenants. So we have not here the case of entire strangers or trespassers entering on the land for the first time and claiming to hold it adversely as permanent tenants. It is a case of a person who entered on the land as a tenant and paid rent, and subsequently made an assertion of permanent tenancy. But even then it cannot be said that the mere assertion as a permanent tenant would clothe him with the status of a permanent tenant by adverse possession. It must be noted that the plaintiffs' own case in the plaint was that they were permanent tenants at a fixed rent, and the evidence shows conclusively that the rent was changed from Rs. 103 to Rs. 175 even after the assertion of permanent tenancy was made. Very strong reliance-has been placed on behalf of the appellants on a decision of the (1928) L.R. 55 I.A. 212 : S.C. 30 Bom. L.R. 1361, but I agree that that decision, which turns on the special facts of that case, does not apply to the facts of the present case at alt In fact that decision was given on the basis that in that case the relationship of landlord and tenant had ceased between the parties after the assertion of permanent tenancy, and that the rent was taken by the landlord in the name of the original mukarraridars and receipts were also given in their names only, and when the tenants demanded receipts in their own names, the landlord refused to give such receipts, and thereafter no rent was paid. On that, made a finding that the landlord did not admit any tenancy on the part of the defendants, and did not in fact allow them or their predecessors to be in possession as tenants. Therefore it is stated that on the special facts of that case, the parties were at. arm's length, the heirs of the lessees were asserting their permanent interest with a liability to pay rent, and they continued to assert it consistently from 1883. Here, however, the facts are entirely different. As I have observed, not only did the tenants pay the rent between 1851 and 1855, but ever since then also they have been paying rent, which the landlord has been accepting, and the rent is also increased. So the relationship of landlord and tenant has subsisted between them after the assertion of permanent tenancy. The present case, therefore, falls within the principle of the decisions in v. (1923) L.R. 50 I.A. 202, (1923) L.R. 51 I.A. 83, and also of the decision of our in v. (1933) 36 Bom. L.R. 359; and not within the principle of the decision in . That being the only principal argument with regard to this land, I agree, that the appellants ale not permanent tenants thereof, and the decision of the lower on that point should be affirmed. ", "8. With regard to the notice, I agree that the notice as given was not properly served, as it is clear that the registered document was refused. But I agree that the second set of plaintiffs, viz. the , were joint among themselves, and held the land jointly, and it is proved in this case that defendants Nos. 5 and 6 did receive the notice, and therefore, they being joint tenants along with defendants Nos. 3 and 4, the latter should also be deemed to have received it. Therefore the suit is not bad on that ground. It is true that the landlord has relied on the notice of 1921 in the plaint, but that is clearly wrong, and I agree that the interests of justice require that the plaintiff should be allowed to amend the plaint. ", "9. Appeal No. 477 : Allowed as regards property A and dismissed as regards property B. Parties to get their proportionate costs throughout. ", "10. Appeal No. 471 : Allowed as regards property A. As to property B liberty to amend by pleading the notice of September 1925. Judgment for possession and for mesne profits of property B from three years before this date till delivery of possession. Inquiry, as regards mesne profits of property B and as to the amount of rent to be attributed to property A to be made in execution. Respondent to pay costs throughout in suit No. 243 and Appeal No. 471, but costs of evidence common to both suits to be allowed only in suit No. 132 of 1926."], "relevant_candidates": ["0001490532", "0001512543", "0005565313"]} {"id": "0000431220", "text": [", J. ", "1. I have had the advantage of reading the judgment of my learned brother and I entirely concur. I would, however, like to add a few words as to the meaning to be given to the words \"error apparent on the face of the record\". I conceive that in the English cases from which this expression has been borrowed the emphasis is not upon the word \"error\" but upon the words \"apparent on the face of the record\", that is to say that error must be such as can be ascertained from the record as it exists or should exist. ", "2. In 'Walsall Overseers v. , 1878-4 AC 30 (A), Lord , Lord Chancellor, stated, at_ page 39 : ", "\"If there was upon the face of the order of anything which shewed that that order was erroneous, might be asked to have the order brought into it, and to look at the order, and view it upon the face of it, and if the found error upon the face of it, to put an end to its existence by quashing it.\" ", "3. In 'Rex v. ', 1922-2 AC 128 (B), Lord stated, at page 155 of the Report: ", "\"The key of the question is the amount of material stated or to be stated on the record returned and brought into the superior . If justices state more than they are bound to state, it may, so to speak, be used against them, and out of their own mouths they may be condemned, but there is no suggestion that, apart from questions of jurisdiction, a party may state further matters to the , either by new affidavits or by producing anything that is not on or part of the record.\" Again, at page 159 of the Report, Lord added : ", "\"When the Summary Jurisdiction Act provided, as the sufficient record of all summary convictions, a common form, which did not include any statement of the evidence for the conviction, it did not stint, the jurisdiction of , or alter the actual law of certiorari. What it did was to disarm its exercise. The effect was not to make that which had been error, error no longer but to remove nearly all opportunity for its detection. The face of the record \"spoke\" no longer; it was the inscrutable face of a sphinx.\" ", "The same point is clearly brought out in -- 'Rex v. Northumberland Compensation Appeal Tribunal', 1952-1 KB 338 (C), Lord Justice states at page 349 of the Report: ", "\"The record had to contain everything necessary to show that the Justices had jurisdiction to deal with the matter, and it had to set out their adjudication; but it was not necessary to set out either the evidence or the reasons. If a point of law arose, however, on which either party desired the ruling of , he could ask the justices to make a speaking order, that is, to make a special entry upon the record of the reasons for their judgment. The justices were not bound to do this, but they usually did so if they entertained a doubt about the point. When their reasons thus appeared on the record, would on certiorari inquire into their correctness, and, if the reasons were wrong, would quash the decision.\" ", "4. Their Lordships of have held in -- \" ', 1954 SC 440 (AIR V 41) (D), in a passage quoted at length by my learned brother that the broad and fundamental principles that regulate the exercise of jurisdiction in the matter of granting writs in English law are applicable to India. ", "5. If any position as to the scope of certiorari other than that laid in the English decisions were adopted, it might well be that , having discovered an error on the record, would be bound to allow that error to subsist because it was not one of sufficient gravity to justify interference. Such a position has been negatived by this Court in --' . at Allahabad', 1955 All 557 ((S) AIR V 42) (E), and by in -- ' , 1955 SC 425 ( (SJ AIR V 42) (F), in passages which my learned brother has quoted and which it is not necessary for me to repeat. ", "6. In the present case, therefore, it is open to us to examine the order of the Chancellor which is a \"speaking order\" to consider the interpretation which he places on the statute & the reasons therefor which he gives and on finding that he misinterpreted the relevant provisions of the statute, to quash his order in the exercise of our power of certiorari. ", "Mehrotra, J. ", "7. This is an appeal under Chapter VIII. Rule 5 of the Rules of Court against a judgment of a Single Judge of this Court allowing a petition under Article 226 of the Constitution filed by the respondent, Dr. . ", "8. Briefly, the facts, which gave rise to the petition, are that the respondent, Dr. , was a Professor in , appellant 2, and the Head of until 13-3-1954, the date on which he retired from the service of the . He was also a member of the Academic Council of the and as such was an ex officio member of the under head (vi) of Section 17 of the Allahabad Act, 1921. ", "The is the supreme governing body of the under the Act and the executive body of the is . The constitution of is laid down in the Statutes which are to be found in Chapter II of the Statutes, Ordinances and Regulations made under the Act. consists of twenty members of whom six are members of the elected by the at its annual meeting. In the annual meeting of the held in November 1952, the respondent was elected to . ", "One of the limitations placed by the Statutes on the powers of the to elect six of its members to is that two of the persons so elected must be members who themselves were elected as members of the by the registered graduates. Out of the six persons elected by the to the membership of , four were persons who had been elected to the by the registered graduates but the respondent was not one of those four persons, ", "9. Under head (xviii) of Section 17 of the Act read with clause (2) of the first Statute relating to the , the Chancellor of the University is empowered to appoint not more than 15 persons to be members of the and by a letter dated 8-3-1954, the Chancellor, in the exercise of the powers so vested in him, appointed the respondent to be a member of the University in place of Sri . The express words in the letter of appointment which are relevant for the consideration of the petition are \"With effect from the date of the former's retirement (that is, the retirement of the respondent) from the post of Professor and Head of of , viz. March 12, 1954, for the' residue of the term of office of Sri , viz. up to December 14, 1955.\" ", "It is admitted by the parties that in this letter reference to March 12 is a mistake for March 13. The respondent admittedly retired from the with effect from 13-3-1954 and consequently his nomination to the membership of the com-menced with effect from his retirement and was to last till December, 14, 1955. ", "10. The question which arose before the University authorities was whether the respondent con-tinned to be a member of alter 13-3-1954 in view of the provisions of the Statute, Clause (2) of the first Statute relating to provides that the members of the other than ex officio members shall hold office for a period of three years, but there is a proviso appended to this clause which reads as follows : ", "\"Provided that a member appointed or elected as a member of a particular body or as the holder of a particular post shall hold office so long only within that period as he continues to be a member of that body or the holder of that post, as the case may be.\" ", "The question having arisen as to whether the case of the respondent fell within the ambit of this proviso, the Vice-Chancellor referred the matter for decision to the Chancellor under the provisions of Section 42 of the Act. On 20-8-1954, the Chancellor, by an order pf that date, decided that the respondent was not entitled to, continue to be a member, of . Thereupon a petition was filed in this Court under Article 226 of the Constitution for the issue of a writ of certiorari to quash that; decision and also for the issue of a writ of mandamus directing the appellants not to interfere with the attendance of the respondent at meetings of and in the peformance of his functions as such member. ", "In the petition, the Registrar , the through the Vice-Chancellor, the Vice-Chancellor of the as holding the office of Vice-chancellor and the Chancellor of the were impleaded as opposite-parties. The petition was contested on behalf of all the opposite-parties and the learned Single Judge of this Court, by his order dated 29-10-1954, upheld the contentions raised by the petitioner-respondent and allowed the petition. ", "A writ of certiorari was issued quashing the order of the Chancellor dated 20-8-1954. The prayer for a writ of mandamus, however., was refused in the circumstances of the case.. The order of the learned Single Judge has, now been challenged in this appeal. ", "11. The first point to be considered is whether the Chancellor, acting under Section 42 of the Allahabad University Act, constituted a quasi-judicial tribunal and any decision by him under the said section was, therefore, subject to the superintendence of this Court or he was acting only administratively. ", "12. The question whether a power is judicial or quasi-judicial or it is merely administrative has to be decided upon the language of the Statute, upon the nature of the power and, the consequences of its exercise upon the rights of others and the exigencies of the situation. The main thing to be considered is whether the authority concerned has to decide a dispute between two parties or it has merely to take note of the dispute to inform its mind before it exercises the power conferred upon it in its discretion. In the former case it acts judicially or quasi-judicially but in the latter case it acts administratively. ", "The principle on which it can be determined whether an authority has acted judicially, quasi-judi-cially or administratively has been considered in the case of , 1950 SC 222 (AIR V 37) (G). In order to decide this question it is necessary to refer to the provisions of Section 42 of the Act which reads as follows:-- ", "\"If any question arises whether any person has bteen duly elected or appointed as, or is entitled to be, a member of any authority or other body of the , the matter shall be referred to the Chancellor, whose decision thereon shall be final.\" ", "The Chancellor has not only to exercise his discretion but he has to take a decision thereon which necessarily implies that, in determining the dispute referred to him, he had to act judicially. The question, which can be referred to him under Section 42 , is also whether any person has been duly elected or appointed, which necessarily implies that the Chancellor has not to consider the question whether in his opinion a person has been elected or appointed but has to determine whether he has been duly elected, that is, in accordance with the provisions of the Statute. It has therefore, been rightly conceded by the Advocate General that the Chancellor constituted a tribunal the decision of which is subject to the superintendence of this under Article 226 of the Constitution. ", "13. The point, which was strongly urged before the Single Judge, was that this Court had no authority under Article 226 of the Constitution to quash, by a writ of certiorari, an order made by a tribunal subject to the superintendence of this Court on the ground that it is, on the face of it, erroneous in law; the jurisdiction of this Court to interfere with orders passed by subordinate tribunals under Article 226 of the Constitution is limited to the cases where a tribunal has exceeded its jurisdiction or has acted against the principles of natural justice in the exercise of its limited jurisdiction; there is no power in this Court to exercise its jurisdiction under Article 226 of the Constitution in cases where the decision by a subordinate tribunal is erroneous in law on the face of the record. ", "In view of recent decisions of , however, the learned Advocate General has conceded that it is open to this Court to quash the decision of an inferior tribunal if it is erroneous in law on the face of the record. ", "14. Article 226 of the Constitution is couched in very wide terms. It gives power to to interfere, Under its supervisory jurisdiction, with the orders of inferior tribunals somewhat in the same manner as the court of in England. Whatever restrictions there are, they have been placed by the courts themselves having regard to the fact that the Article gives a discretion to superior courts which is to be exercised OB well-known judicial principles. ", "The scope of to interfere with decisions of inferior tribunals by issuing a writ of certiorari has now been finally determined by in the case of , 1955 SC 233 ((S) AIR V 42) (H). Their Lordships, after considering all the Indian authorities as well as the authorities of , have laid down that \"It may therefore be taken as settled that a writ of certiorari could be issued to correct an error of law. But it is essential that it should be something more than a mere error; it must be one which must be manifest on the face of the record.\" ", "In this very case, their Lordships have approved of the principle laid down by the court of appeal in England in the case of 1952-1 All E R 122 (C). In an earlier case of 1954 SC 440 (AIR V 41) (D) it was observed by their Lordships as follows; ", "\"In view of the express provisions in our Constitution we need not now look back to the early history or the procedural technicalities of these writs in English law, nor feel oppressed by any difference or change of opinion expressed in particular cases by English Judges. We can make an order or issue a writ in the nature of 'certiorari' in all appropriate cases and in appropriate manner, so long as we keep to the broad and fundamental principles that regulate the exercise of jurisdiction in the matter of granting such writs in English law.\" ", "It was also held by this Court in 1955 All 557 ((S) AIR V 42) (E) that \"the power of this Court to issue a writ of certiorari is not confined to the grounds where the subordinate court has acted without jurisdiction or in excess of its jurisdiction but also on the ground that there is an error of law apparent on the face of the record.\" ", "The main question, therefore, canvassed before us was that the order passed by the Chancellor could not be regarded as an error apparent on the face of the record. At the highest it could only be regarded as a mere error of law and even on the principle laid: down by their Lordships of in 's case (H), referred to above, it was not liable to be quashed by this Court As has been observed by their Lordships of in 's Case (H), the real difficulty is not in staring the principle but in its application to the facts of a particular' case. Their Lordships observed as follows: ", "\"When does an error cease to be mere error, and become an error apparent on the face of the record? Learned Counsel on either side were unable to suggest any clear-cut rule by which the boundary between the two classes of errors could be demarcated. ", "Mr. for the first respondent contended on the strength of certain observations of , C. J. in 1953 Bom 133 (AIR V 40) (I) that no error could b(c) said to be apparent on the face of the record if it was not self-evident, and if it required an examination or argument to establish it. This test might afford a satisfactory basis for decision in the majority of cases. But there must be cases in which even this test might break down, because judicial opinions also differ, and an error that might be considered by one Judge as self-evident might not be so considered by another. ", "The fact is that what is an error apparent on the face of the record \"cannot be defined precisely or exhaustively, there being an element of indefiniteness inherent in its very nature, and it must be left to be determined judicially on the facts of each case.\" ", "15. From this statement of law, it is clear that no exhaustive definition can be given to the words 'error apparent on the face of the record'. It will not entirely depend upon the nature of the error or upon the degree of the error. Each case will have to be determined on its own facts. A superior court or tribunal will have to examine an order itself and decide whether the order, in the circumstances of that particular case, can be regarded as erroneous on the face of the record or a mere error of law. ", "It was contended by the Advocate General that the words 'error apparent on the face of the record occur in Order 47 of the Code of Civil Procedure and it may be useful to refer to cases where the courts have determined the scope and ambit of the words 'error apparent on the face of the record' in Order 47, Rule 1 of the Code of Civil Procedure. In our opinion, it is not a safe guide to rely upon the cases interpreting the words 'error apparent on the face of the record' in Order 47, Rule 1, Civil P. C., in order to determine the scope of these words in connection with the power of: this to issue a writ of certiorari under Article 226 of the Constitution. ", "When a court is asked to review its own order, it may not be a valid ground for the court to say that, as it finds on the reconsideration of its order that it is illegal, it should be set aside as it is an error apparent on the face of the record. It may be different where a superior tribunal is called upon to decide whether any erroneous decision of an inferior tribunal is illegal on the face of it. ", "It was then contended by the Advocate General that in cases where the inferior tribunal has, in the opinion of the superior tribunal, incorrectly interpreted any Statute, it will only be a mere mistake of law and cannot be regarded as an error apparent on the face of the record. We do not see that that is a test which can be applied in all cases and can be accepted as correct. ", "16. In ''s case (H)', quashed the decision of on the ground that it had not properly interpreted the scope and ambit of Section 100 of the Representation o the People Act . The respondent before in that case had been duly declared elected a member of the . 301 votes, which were found in the ballot box of the respondent in that case, had been added to his votes. ", "If these 301 votes had been deducted from the total votes said to have been obtained by him, he could not have been declared elected and one of the questions, therefore, before was whether those votes were proper votes and could be counted for the respondent. By mistake the ballot papers of were issued to the electors of the and the electors, when voting for the respondent in that case, had placed the ballot papers of in his box. ", "The contention of the petitioner in that case was that they were invalid votes and could not be counted in favour of the respondent. held that they were invalid votes and should have been rejected but, as, in their opinion, the addition of those votes did not materially affect the results of the election, the election could not be set aside. The , in holding that the results-of the election were not materially affected by the addition of these votes, relied upon certain extraneous circumstances. ", "The held that although those ballot papers were not valid in view of the provisions o Rule 47, the fact that they were found in the ballot box of the respondent indicated that the electors exercised their choice in favour of the respondent and consequently the result of the election was not materially affected. There were other circums-stances which were considered by the in coming to that conclusion. ", ", on the interpretation of Section 100 , Representation of the People Act held that it was, not permissible for the to consider the intention of the electors in deciding whether the result of the election had been materially affected. It was observed at page 248 of the Report after referring to Rules 47 and 48 of the Rules framed under the Act that--- ", "''Under this rule quite clearly no candidate can be declared elected on the strength of votes which are liable to be rejected under Rule 47. The expression \"the result of the election\" in Section 100(l)(c) must, unless there is something in the context compelling a different interpretation, be construed in the same sense as in S. 66 , and there it clearly means the result on the basis of the valid votes.\" ", "In my opinion, therefore, in that case it was nothing but an erroneous interpretation of the pro-visions of a Statute which was considered by as 'an error apparent on the face of the record.' The determination of the questions as to what is the scope and the ambit of a particular provision of a Statute and what matters can legitimately be determined by a tribunal under the provisions of a particular Statute is nothing else but interpreting a Statute. ", "17. In the case of 1952-1 All ER 122 (C), which was approved by their Lordships of , the facts were that the applicant in that case had been awarded compensation for loss o employment as clerk to a joint hospital board by as compensating authority, and he had appealed against the award to the tribunal on the ground that the compensating authority had failed to take into account his service with the district council, as required by the regulations. The tribunal upheld the decision of the compensating authority. ", "The applicant moved of for an order of certiorari to remove the decision of the tribunal into to be quashed on the ground that the decision was erroneous on the face thereof. In both the tribunal and the compensating authority were respondents to the motion. They both admitted that their decisions were wrong and that an error of law appeared on the face of the decision of the tribunal but they contended that the court had no power to make an order of certiorari since the tribunal had not acted without jurisdiction. ", "In the circumstances of that case a writ of certiorari was issued by and that decision was upheld by . What was considered to be an error apparent on the face of the record was nothing but interpretation of certain regulations made by the compensating authority and the tribunal. ", "18. In the case of -- ' v. and ; Ex Parte Road Haulage Executive', 1953-1 All ER 687 (J), this case was followed and a writ of certiorari was granted by . In that case, the second respondent, George James was awarded by the tribunal appointed by the Minister of Labour and compensation for the loss of emoluments suffered by him when certain transport undertakings of which he was a servant, were acquired by the applicants, , under the Transport Act , 1947. The amount of compensation was calculated in accordance with the provisions of the Transferred Undertakings (Compensation to Employees) Regulations, 1950, schedule II, para 5 (2), on the ground that the respondent had a right to the payment of compensation in the event of discharge within the meaning of para 4(1) (i) of the schedule. ", "It was admitted by the applicants in that case that the respondent had a right to claim damages for wrongful dismissal, but the contention was that such a right was not included in the phrase \"compensation in the event of discharge.\" On that contention a motion was made for an order of certiorari to quash the award which was dismissed by . On appeal, allowed the appeal and the award of the was quashed. ", "19. In Halsbury's Laws of England, Third Edition, Volume II, page 61, para 118, under the head -- Error on the lace of the proceedings --the law has been laid down that- ", "\"Where upon the face: of the proceedings themselves it appears that the determination of the Iinferior tribunal is wrong in law, certiorari to quash will be granted .... Certiorari to quash will be granted where the charge laid before the magistrates, as stated in the information, does not constitute an offence punishable by the magistrates or where it does not amount in law to the offence of which the defendant is convicted or where an order is made which is unauthorised by the finding of the magistrates.\" ", "20. Mr. ,, on the other hand, contended that the words 'an error apparent on the face of the record' only means that if an error is revealed on the perusal of the judgment itself, it is nothing else but an error apparent on the face of the record. It is the duty of this to finally determine the law of the land. ", "Having declared what the law is on which the decision of a particular controversy depends, it is for the superior court to examine the decision of an inferior tribunal and see if the said law has been correctly followed by the inferior tribunal. If it finds on the face of the order, which is, a speaking order, that it had not observed the law as determined by the superior tribunal inasmuch as it has held contrary to that law, it can quash the order of the inferior tribunal. In this connection reliance was placed on the following observations of this Court in the case of 1955 All 557 ((S) AIR V 42) (E) (at p. 560) : ", "\"This decision, to our mind, clearly lays down that the power of this to issue a writ of certiorari is not confined to the grounds where \"the subordinate court has acted without jurisdiction or in excess of its jurisdiction but also on the ground that there is an error of law apparent on the face of the record. The difficulty does arise in deciding whether a particular error of law is an error on the face of the record. ", "To our mind, if a certain order passed by the subordinate tribunal gives the reasons for the decision, that is to say, it is a speaking order as it is termed by English s, then it is open to this , in the exercise of its power under Article 226 of the Constitution, to scrutinise the reasoning of the subordinate so far as can be done without going outside the order itself, examine it and if this finds that the reasons are manifestly wrong on a question of law and the conclusions arrived at by the courts below are apparently erroneous then it is open to this to exercise its jurisdiction under Article 226 of the Constitution and quash such a decision.\" ", "21. Reference in this connection may also be made to the following observations of their Lordships of in the case of 1955 SC 425 ((S) AIR V 42) (F). That was a case where was dealing with an order passed by . One of the contentions raised at the bar was that having been constituted for special purposes under the Act of Legislature, any decision arrived at by the said Tribunal should be considered as final and neither the High Court nor should interfere with such an order in the exercise of its powers under Article 226 of the Constitution. ", "Reliance was also placed on' the express provisions of Section 105 of the Representation of the People Act. Dealing with that argument, the following observations were made by their Lordships of : ", "\"The legality of an act or conclusion is something that exists outside and apart from the decision of an inferior tribunal. It is a part of the law of the land which cannot be finally determined or altered by any tribunal of limited jurisdiction. and alone can determine what the law of the land is vis-a-vis all other courts and tribunals and they alone can pronounce with authority and finality on what is legal and what is not. All that an inferior tribunal can do is to reach a tentative conclusion which is subject to review under Articles 226 and 136 (of the Constitution).\" ", "22. In order, therefore, to see whether the Chancellor has committed an error apparent on the face of the record, I have to consider the relevant provisions of the Statute and the reasonings given by the Chancellor for his decision. ", "23. The whole of the Statute which provides for the membership of and of which the proviso is a part is as follows ; ", "\"1. (1) ............ ", "Class I -- Ex-Officio Members. ", ". ", "Class II -- Other Members. ", "(i) Six members of the , elected by the at its annual meeting of whom two must be from among members of the elected by the registered graduates; ", "(ii) (a) Two Principals, elected by the Principals of Colleges, and ", "(b) One member elected by the Wardens, the Chairman of the Delegacy and the Proctor from among themselves; ", "(iii) Two members elected by from its own body; ", "(iv) Three members appointed by the Chancellor. ", "(2) Members other than ex-officio members shall hold office for a period of three years. ", "Provided that a member appointed or elected as a member of a particular body or as the holder' of a particular post shall hold office so long only within that period as he continues to be a member of that body or the holder of that post, as the case may be.\" ", "Clause (2) of the Statute fixes the tenure of the membership of the members other than the ex-officio members. In the absence of any proviso, the result would have been that all those, who were elected as members of by the by virtue of their membership of the , would have continued to be members of for three years even though during that period they may have ceased to be members of that . Similar results would have followed in the case of members under Clause (ii) of Class II. ", "The members, who would have been elected by the Principals of colleges, would have claimed membership for three years although during that period they may have ceased to be Principals and to hold that office. In order to avoid this result the proviso seems to have been enacted and on the interpretation of the plain language of the proviso, 'to our mind, it only means that any member elected as a member of by virtue of his being a member of a particular body, that is, the , he will hold office, that is, he will remain member of so long only within that period as he continues to be a member of the . ", "In other words, the condition for the continuance of office as a member of , in the case of a member elected by the , is his continuance as a member of the . It is an admitted fact that on 13-3-1954, the respondent was a member of the and also he continued to be a member of the on 14-3-1954. It cannot, therefore, be said that at any point of time he ceased to be a member of the . On the plain language of the proviso, therefore, he continued to be a member of the and as such he did not cease to be a member of . ", "24. The view taken by the Chancellor was that as he was a member of the by virtue of his being a member of , he belonged to the class of ex-officio members of the and his capacity of membership was changed when he was nominated to be a member of the by the Chancellor with effect from his retirement. It could not, therefore, be said that he continued to be a member of the . In support of the view taken by the Chancellor, it was contended by the Advocate General that if the status of the member changed during his period of membership, e.g. an ex-officio member becomes a life member although his membership of the continues without interruption, it is not in the eye of law the same membership and in the eye of law he cannot be regarded to continue to be a member within the meaning of the proviso. ", "In this connection it was also argued by the Advocate General that in properly construing the intention of the framers of this proviso, it was relevant to consider what could have been the intention of the electors when they elected the respondent to the membership of . ....The members of the , when they elected him to the membership of , must have visualised that the respondent was a member of the ex-officio by virtue of his membership of and his membership was liable to cease as soon as he ceased to be a member of ., If the proviso is interpreted in a manner other than that suggested by the Chancellor, the result will be that the respondent will continue to be a member of though that may never have been intended by the electors. ", "25. I do not think that there is any force in this contention of the Advocate General. In interpreting the intention of the framers of the Statute, the primary thing, which is to be considered, is the language of the Statute. The intention has to be deduced from the language. The words are to be given their plain meaning and if the words used by the framers of the Statute are plain in their meaning, it is not permissible to deduce the intention of the framers from considerations extraneous to the meaning of the words used\" by the framers of the Statute. ", "It is not necessary to refer to authorities on this point. It is a well settled principle of interpretation of Statutes that the intent of an enactment has to be determined by the language of the Statute. It is not permissible for courts to travel beyond the language of the Statute and try to fish the intention of the framers from considerations which the courts regard reasonable. It would be really legislating and not interpreting. ", "Having regard to the plain language of the proviso 1 am of opinion that any person, who continues to be member of the , will continue to be a member of and a mere change in his capacity, that is, the qualification under which he becomes a member of the , will not disentitle him to remain a member of , it has been accepted by the Advocate General before us as well as before the learned Single Judge that the interpretation put by him on the proviso will necessarily involve the addition of certain words. The proviso has to be construed as if after the phrase 'a member of that body' there are deemed to be added the words 'in the same capacity as he was elected or appointed to it. It is a well-known rule of construction that in the absence of anything to modify or qualify, the words used in the Statute must be given their plain meaning and that it is not open; to add words to a Statute, it was observed by their Lordships of in the case of --' , 1938 PC 281 (AIR V 25) (K) that \"the cannot put into an Act words which are not expressed and which cannot reasonably be implied on any recognised principle of construction.\" Nothing should be import-, eel into an enactment merely on the basis of a speculation as to the intention of the . ", "26. The Chancellor has, however, tried to import the concept of capacity from the word 'continue'. In order to examine the reasoning of the Chancellor, it will be necessary to refer to a part of his order. Paragraph 9 of the order of the Chancellor reads as follows : ", "\"The word 'continue' is defined in as meaning, 'to carry on; 'keep up'; 'maintain'; 'persist in'; 'to remain in existence or in its present condition'; 'to last, endure or persist in being'; 'to remain (in a specified state or capacity)'. The word 'continue' carries with it the sense of a running nature of things under the same conditions, that is, without a break in capacity, time, sequence, tenure or essence. ", "While construing the words 'continue in office' Baron in -- \" v. Mayor of Berwick-Upon Tweed', (1856) 5 HLC 856 (805) (L) said that to establish continuance the duties \"prima facie must not be changed; its liabilities and checks must not be varied; not even its duration and tenure varied.\" Mere juxtaposition of two distinct periods of time without persistence of these essential attributes would not, therefore, be continuance.\" ", "The case referred to by the Chancellor was a case where the court was called upon to interpret certain words in a security bond and the words used therein were 'to continue in the said office'. In interpreting those words, it was observed that the words 'to continue in the said office' necessarily implied the continuance of the duties, liabilities and checks. In the present case, it has not been pointed out that any change has been brought about in the duties or liabilities or checks of the respondent as a member of the . The qualification entitling him to become a member of the may have changed but his duties and liabilities as a member of the underwent no change. ", "Nothing has been pointed out in the Statute or in the Act which will go to show that the duties and the liabilities qua the membership of the are different of the ex-officio members from that 'of the other members. Even the dictionary meaning quoted by the Chancellor, to our mind, makes no difference so far as the interpretation of the word 'continue' is concerned. Emphasis appears to have been laid by the Chancellor on the words 'in a specified state or capacity within brackets after the words 'to remain.' Even it is be accepted that the part within the brackets forms part of the meaning of the word 'continue', it cannot be said that the 'specified state or capacity' of the respondent 'changed. In our opinion, therefore, the plain meaning of the proviso is that so long as a member of , who had been clected by the , remains a member of the , he continues to be member of . There is nothing in the language of the proviso to justify the interpretation that the change of qualification will result in the extinction of his membership of . ", "27. It was lastly contended by the Advocate General that there were various meanings given to the word 'continue' in dictionary and it was open to (he Chancellor to select any one of those mean-Ings and having selected that meaning and interpreted the proviso on the strength of that meaning, it cannot be said that the interpretation placed by the Chancellor is erroneous on the face of the record. I do not see that there is any substance in this contention. ", "A word may be given different meanings in a dictionary but what is the meaning which is to be given to that word in a Statute has to be determined in the light of the provision of the Statute in which that word has been used. It docs not give any power to the inferior tribunal to just arbitrarily select any meaning given to a word used in the Statute in dictionary but the superior court can examine whether the particular meaning given by the inferior court was the meaning which could be given to that word in that particular provision. ", "This Court has only to examine the\" provisions of the Statute and the reasoning given by the Chancellor to come to the conclusion that the interpretation put by the Chancellor on the word 'continue' is erroneous on the face of it and cannot be accepted. The error committed, therefore, by the Chancellor, in my opinion, was an error apparent on the face of the record and his decision can be quashed by this Court in 'the exercise of its power under Article 226 of the Constitution. ", "28. Some argument was also addressed by Mr. who appeared on behalf of the . His contention 'was that as the Chancellor was an inferior tribunal created under the Statute for the specific purpose of determining the matters connected with the and as finality has been given to his decision under Section 42 , it is not open to this Court to interfere with the decision of the Chancellor in the exercise of its writ jurisdiction. ", "In effect, his argument was that, although there is no limitation on the powers of tin's , under Article 226 in the exercise of this power, this 'will not interfere with the decisions of domestic tribunals. I do not see that there is any force in this contention. So far as the effect of the words 'decision thereon shall be final' occurring in Section 42 is concerned, we have already referred to the case of the Supreme wherein the provisions' of Section 105 of the Representation of the People Act were considered end it was argued that as the decision of under that section' was final, it was not amenable to the jurisdiction of the High under Article 226 of the Constitution. That contention was precisely repelled by the Supreme . ", "As regards the contention that this will not interfere with the decision of a domestic tribunal in the exercise of its power under Article 226 of the Constitution, we are of opinion that when under some Statute creating a tribunal, the tribunal is called upon to act judicially, any decision by such tribunal can be interfered with by this in appropriate cases and no general rule can be laid down that all decisions of such tribunals, which can be called domestic tribunals, cannot be interfered with'; by this . ", "29. It was also contended by Mr. that the final jurisdiction given to and to determine the law of the land does not apply to the cases where the law which is determined is a law which is liable to be changed by the domestic authorities and is not an enactment of any . I do not think that any such distinction can be drawn. Any order passed by the Chancellor had the result of affecting the right of the respondent as a member of and consequently such a determination was subject to the supervisory jurisdiction of this . ", "30. Mr. , who appeared for the respondent, further contended that the respondent was also nominated as a member of the on behalf of . As that nomination became effective before he retired from the University, on the strength of that nomination it was open to him to contend that he continued to be a member of the within the meaning of the proviso. The learned Single Judge did not go into this question as he was going to allow the petition on the other point. As we are also agreeing with the view of the learned Single Judge, on the other question, it is not necessary for us to go into this question. ", "31. In the result, therefore, I would dismiss this appeal with costs."], "relevant_candidates": ["0000156643", "0001219198", "0001224706", "0001346715", "0001450722", "0001954356", "0001959866"]} {"id": "0000450563", "text": ["REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO. 2092 OF 2006 Commissioner of Income Tax ....Appellant Central, Kanpur Versus J.K. Charitable Trust ....Respondent Kamal Tower, Kanpur With CIVIL APPEAL NO. 1698 OF 2008 With CIVIL APPEAL NO. 1699 OF 2008 With CIVIL APPEAL NO. 2423 OF 2006 With CIVIL APPEAL NO. 682 OF 2007 1 JUDGMENT Dr. ARIJIT PASAYAT, J. ", "1. Challenge in these appeals in each case is to the order passed by a Division Bench of answering the reference made by , Allahabad Bench (in short the `') under Section 256(1) of the Income Tax Act, 1961 (in short the `Act') in favour of the assessee and against the revenue. For answering the references in favour of the assessee relied upon its judgment for two previous assessment years i.e. 1972-73 and 1973-74 in the assessee's case which is reported in ION> (1992 (196) IIR 31). The present dispute relates to several assessment years, i.e. 1972-73 (in respect of an assessment re done under Section 147(1) of the Act) and assessment years 1975-76 to 1982-83. ", "2. Learned counsel for the revenue appellant submitted that each assessment year is a separate assessment unit and the factual scenario has to be seen. Dispute relates to the question whether the respondent, assessee's trust was hit by the provisions of Section 13(1)(c) and 13(2)(a)(f) & (h) of the Act and therefore cannot be given the benefit of exemption provided under Section 11 of the Act. ", "3. Learned counsel for the assessee submitted that for several years no appeal has been filed even though the factual position is the same i.e. for the assessment years 1983-84 upto assessment year 2007-08. Even no appeal was filed against the decision reported in [1992(196) ITR 31] (supra). It is also pointed out that several other have taken a similar view and no appeal was preferred by the revenue against any of the judgments of the different . Reference is made to the decisions reported in [(1982) 133 ITR 494], [(1983) 139 ITR 913], .2 [1988 (172) ITR 698] and [1996 (226) ITR 394]. The first two judgments have been rendered by the Bombay and Calcutta respectively while the other two decisions are of the Gujarat . ", "4. Learned counsel for the revenue submitted that even though appeal has not been preferred in respect of some assessment years, that does not create a bar for the revenue filing an appeal for other assessment years. Reliance is placed on a decision of this Court in [(2008)304 ITR 61 (SC)]. ", "5. The factual scenario is undisputed that for a large number of assessment years no appeal has been filed. ", " ", "6. The basic question therefore is whether the revenue can be precluded from filing an appeal even though in respect of some other years involving identical dispute no appeal is filed. ", " ", "7. For deciding the issue a few decisions of this need to be noted. ", "8. (2006 (3) SCC 1) it was noted as follows: ", "\"The decisions cited have uniformly held that res judicata does not apply in matters pertaining to tax for different assessment years because res judicata applies to debar courts from entertaining issues on the same cause of action whereas the cause of action for each assessment year is distinct. The courts will generally adopt an earlier pronouncement of the law or a conclusion of fact unless there is a new ground urged or a material change in the factual position. The reason why the courts have held parties to the opinion expressed in a decision in one assessment year to the same opinion in a subsequent year is not because of any principle of res judicata but because of the theory of precedent or the precedential value of the earlier pronouncement. Where facts and law in a subsequent assessment year are the same, no authority whether quasi-judicial or judicial can generally be permitted to take a different view. This mandate is subject only to the usual gateways of distinguishing the earlier decision or where the earlier decision is per incuriam. However, these are fetters only on a coordinate Bench which, failing the possibility of availing of either of these gateways, may yet differ with the view expressed and refer the matter to a Bench of superior strength or in some cases to a Bench of superior jurisdiction. ", "A decision can be set aside in the same lis on a prayer for review or an application for recall or under Article 32 in the peculiar circumstances mentioned in (2002 (4) SCC 388). As we have said, overruling of a decision takes place in a subsequent lis where the precedential value of the decision is called in question. No one can dispute that in our judicial system it is open to a court of superior jurisdiction or strength before which a decision of a Bench of lower strength is cited as an authority, to overrule it. This overruling would not operate to upset the binding nature of the decision on the parties to an earlier lis in that lis, for whom the principle of res judicata would continue to operate. But in tax cases relating to a subsequent year involving the same issue as an earlier year, the court can differ from the view expressed if the case is distinguishable or per incuriam. The decision in (2003(3) SCC 239) related to the year 1988. Admittedly, the present dispute relates to a subsequent period. Here a coordinate Bench has referred the matter to a larger Bench. This Bench being of superior strength, we can, if we so find, declare that the earlier decision does not represent the law. None of the decisions cited by are authorities for the proposition that we cannot, in the circumstances of this case, do so. This preliminary objection of is therefore rejected.\" ", " ", "9. (1995(4) SCC 683) the position was highlighted by this court as follows: ", " ", "\"We are unable to appreciate the objection raised against the prosecution of this appeal by the appellant or other SLPs filed in similar matters. Sometimes, as it was stated on behalf of the , the Government may not choose to file appeals against certain judgments of rendered in writ petitions when they are considered as stray cases and not worthwhile invoking the discretionary jurisdiction of this under Article 136 of the Constitution, for seeking redressal therefor. At other times, it is also possible for the , not to file appeals before this in some matters on account of improper advice or negligence or improper conduct of officers concerned. It is further possible, that even where SLPs are filed by the against judgments of , such SLPs may not be entertained by this in exercise of its discretionary jurisdiction under Article 136 of the Constitution either because they are considered as individual cases or because they are considered as cases not involving stakes which may adversely affect the interest of the . Therefore, the circumstance of the non-filing of the appeals by the in some similar matters or the rejection of some SLPs in limine by this in some other similar matters by itself, in our view, cannot be held as a bar against the in filing an SLP or SLPs in other similar matters where it is considered on behalf of the that non- filing of such SLP or SLPs and pursuing them is likely to seriously jeopardise the interest of the or public interest.\" ", "6 ", "10. [2004(1)SCC 347] reference was made to the judgments in Digambar's case (supra) and (1996(3) SCC 493). It was noted as follows: ", "\"28. In the aforementioned situation, of manifestly erred in refusing to consider the contentions of the appellants on their own merit, particularly, when the question as regards difference in the grant of scale of pay on the ground of different educational qualification stands concluded by a judgment of this Court in {(1991) Supp(1) SCC 138]. If the judgment of case (supra) is to be followed, a finding of fact was required to be arrived at that they are similarly situated to the case of (supra) which in turn would mean that they are also holders of diploma in Engineering. They admittedly being not, the contention of the appellants could not be rejected. Non-filing of an appeal, in any event, would not be a ground for refusing to consider a matter on its own merits. ( ) ", "29. (1996) 3 SCC ", "493) wherein this noticed case (supra) by holding: (SCC p. 494, para 4) \"4. , the learned counsel for the appellants, contended that though an appeal against the earlier order of has not been filed, since larger public interest is involved in the interpretation given by following its earlier judgment, the matter requires consideration by this . We find force in this contention. In the similar circumstances, this in 's case (supra) and in case (supra) had held that though an appeal was not filed against an earlier order, when public interest is involved in interpretation of law, the is entitled to go into the question.\" ", "11. In 's case (supra) reference was made to case (supra) wherein it was observed at paragraph 5 as follows: ", "\"It is then contended that Section 3(2) and (3) make distinction between the employees covered by those provisions and the employees of the aided schools taken over under Section 3(2) . Until the taking over by operation of Section 3(4) recommendation is complete, they do not become the employees of the under Section 4 of the Act. The in exercise of the power under Section 8 constituted a committee and directed to enquire and recommend the feasibility to take over the schools. On the recommendation made by them, the have taken decision on 13-1-1981 by which date the respondents were not duly appointed as the employees of the taken over institution. Therefore, cannot issue a mandamus directing the to act in violation of law.\" ", "12. (2006(2)SCC ", "439) at paragraph 24 the position was reiterated. ", "13. [] it was observed that equity is not a relevant factor for the purpose of interpretation. ", " ", "14. It will be relevant to note that in [(2000)243 ITR 143 ( [(2001) 249 ITR 219] this Court observed that without a just cause the cannot file the appeal in one case while deciding not to file an appeal in another case. This position was also noted in [(2004)9 SCC 420]. ", " ", "15. In case (supra) this Court held that where different have taken different views and some of the have decided in favour of the revenue, same is a just cause for the revenue to prefer an appeal. ", "16. If the assessee takes the stand that the acted mala fide in not preferring appeal in one case and filing the appeal in other case, it has to establish malafides. As a matter of fact, as rightly contended by the learned counsel for the revenue, there may be certain cases where because of the small amount of revenue involved, no appeal is filed. Policy decisions have been taken not to prefer appeal where the revenue involved is below a certain amount. Similarly, where the effect of the decision is revenue neutral there may not be any need for preferring the appeal. All these certainly provide the foundation for making a departure. ", "17. In case (supra) it was held that merely because in some cases revenue has not preferred an appeal that does not operate as a bar for the revenue to prefer an appeal in another case where there is just cause for doing so or it is in public interest to do so or for a pronouncement by the higher court when divergent views are expressed by the different . In this case, it is accepted by the learned counsel for the appellant-revenue that the fact situation in all the assessment years is same. According to him, if the fact situation changes then the revenue can certainly prefer an appeal notwithstanding the fact that for some years no appeal was preferred. This question is of academic interest in the present appeals as undisputedly the fact situation is the same. ", "18. The appeals are without merit and are accordingly dismissed. No costs. ", " ", "........................................J. (Dr. ARIJIT PASAYAT) ........................................J. (C.K. THAKKER) ..........................................) New Delhi; ", "November 7, 2008"], "relevant_candidates": ["0000053024", "0000070974", "0000090703", "0000193101", "0000222788", "0000234348", "0000243501", "0000607622", "0000697303", "0000909959", "0001147888", "0001319386", "0001464917", "0001797151", "0001962308", "0001970352", "0006544121", "0123456797"]} {"id": "0000469517", "text": ["JUDGMENT , J. ", "1. This Rule raises a question of first impression and of considerable importance, namely, whether this is competent to make an order for stay of proceedings in execution of its decree, in view of an application by the judgment-debtor to for special leave to appeal to His Majesty in Council. The circumstances, under which the application has been made, are not disputed and may be briefly stated. The petitioners were defendants in a mortgage suit. The of first instance dismissed the suit on the merit. On appeal to this , that decree was reversed and the usual mortgage decree made on the 16th February 1911. The defendants applied to this for leave to appeal to His Majesty in Council. This application was refused on the 19th March 1912, on the ground that the decree did not involve a claim to a property of the value of Rs. 10,000 or upwards. The defendants applied to this to review this order; that application was refused on the 16th April 1912. The position, therefore, is that in so far as the s of this country are concerned, the mortgage decree has become final. On the 7th July 1912, the defendants, however, made the present application for a stay of proceedings in execution of our decree, for which the decree-holder had applied to the below on the 2nd November 1911, during the pendency of the application in this for leave to appeal to His Majesty in Council The present Rule was granted on the application of the 7th July 1912. The petitioners state in their affidavit that they have taken steps to apply to for special leave to appeal to His Majesty in Council, and at the hearing before us, the learned for the petitioners stated that the papers and costs have been transmitted to their Solicitors in England. The decree-holders opposed the application on the ground that as in appeal or application for leave to appeal is pending in this or elsewhere, the has no jurisdiction to grant a stay of proceedings. It is not disputed that there is no statutory provision applicable to this question; indeed, the absence of a provision in this behalf is not a matter for surprise, because the Code of Civil Procedure does not deal with applications for special leave to appeal to His Majesty in Council, though Section 112 of the Code of 1908 declares that nothing in the Code shall be deemed to bar the full and unqualified exercise of His Majesty's pleasure in receiving or rejecting appeals to His Majesty in Council. The question, therefore, arises whether this is competent, in the exercise of its inherent power, to stay proceedings under these circumstances. Section 151 of the Code does not lay down any new principle, but merely declares that the has inherent power to make such orders as may be necessary for the ends of justice or to prevent abuse of the process of the . The existence of this inherent power to do justice has been recognized from the earliest times, v. 9 W.R. 402; B.L.R. Sup. Vol. 985 and has been repeatedly affirmed: v. 3 C.L.J. 29 and 3 O.L.J. 67; 33 0. 927. This inherent power is not, as has sometimes been supposed, capriciously or arbitrarily exercised; it is exercised ex debito justitiae, to do that real and substantial justice for the administration of which alone the exists. In other words, as Mr. Justice puts it in 3 O.L.J. 67; 33 0. 927 the in the exercise of such inherent power must be careful to see that its decision is based on sound general principles and is not in conflict with them or the intentions of the . It is not necessary for my present purpose to formulate the circumstances under which a will exercise its inherent power; various instances will be found mentioned in the judgments in 3 O.L.J. 67; 33 0. 927. Amongst obvious cases may be mentioned, consolidation of suits and appeals, postponement of the hearing of a suit pending the decision of a selected action, stay of cross-suits on the ground of convenience, inquiry as to whether all the proper parties are before the , entertaining an application of a stranger to be made a party, the addition of a party, entertaining a defence in forma pauperis, deciding one question while reserving another for investigation, remanding a suit which has not been properly tried, staying the drawing up of the 's own order, suspending the operation of the 's order, staying proceedings pending an appeal in a guardianship matter and appointing a temporary guardian ad interim, applying the principle of res judicata to execution proceedings for the sake of finality, punishing contempt of committed when the is not sitting, deciding questions of jurisdiction though the is ultimately found not to have jurisdiction over the suit, directing a party who has applied for leave to appeal to His Majesty in Council to pay costs on the dismissal of his application, amending decrees or orders, granting restitution in cases of reversal of execution sales and orders in execution proceedings, restraining by injunction a person from proceeding with a suit in the Small Cause , staying proceedings pursuant to its own order in view of an intended appeal, and treating an application for revision as an appeal and vice versa: 25 C.757; 2 C.W.N. 529; 29 C. 644; v. 26 A. 358; (1904) A.W.N. 50; v. 2 A.L.J. 18. Let me examine the matter before us in the light of this principle. The decree-holders contend that the is not competent to grant a stay, because no appeal or application for leave to appeal is pending here or elsewhere. This argument is based on the assumption that the has authority to grant a stay, only when an appeal or an application for leave to appeal is pending. The assumption is groundless and is negatived by Order XLI, Rule 5(2), of the Code of 1908, which expressly recognises the position that an original may, for a limited time, stay proceedings in execution of its own decree, in view of a possible appeal to a superior tribunal. The principle, thus recognised by the in express terms, furnishes, in my opinion, a useful guidance in the determination of the question, how the inherent power of this should be exercised in a matter of this description. That the has inherent power to stay proceedings pursuant to its own order in view of an intended appeal, even though there is no express statutory provision in that behalf, is conclusively shown by the case of v. 5 O.W.N. 781. This is one aspect of the matter. Another point of view is of equal, if not greater, importance. have laid down, in 38 I.A. 74; 38 C. 335; 13 C.L.J. 529; 11 Ind. Cas. 384; 8 A.L.J. 449; 13 Bom. L.R. 419; 10 M.L.T. 25; (1911) 2 M.W.N. 124; 4 Bur. L.T. 123 (P.C.) that as soon as an appeal has been admitted by special leave of His Majesty in Council, the High is vested with authority to stay execution, in the same manner as if leave to appeal had been granted by the High itself. Consequently, if the proposed application by the petitioners for special leave to appeal to His Majesty in Council is granted by , this will be competent to stay proceedings under the authority of the decision just mentioned. The , therefore, ought now to act in aid of a possible order for stay that may hereafter have to be made. If the contrary view is taken, what is the result? Assume that the present application for stay is refused, and the decree-holders are permitted to sell the mortgage properties; the application for special leave is granted by , and an application then made to this by the judgment-debtors for stay of proceedings. Are we to say that our action has already been paralysed, that we are powerless to grant relief and that the application is infructuous? I am strongly of opinion, after most anxious consideration of the subject, that the should not tolerate such a result, and as I have shown, the position may be avoided by the recognition of sound judicial principles. The decree now under execution was made by this , and the has control over it, so as to enable the to stay proceedings in view of a possible appeal to His Majesty in Council. It is fairly obvious that if the contention of the decree-holders were to prevail, the gravest injustice might be done to litigants. An application to for special leave to appeal to His Majesty in Council, must necessarily take time; distance cannot be annihilated, and time must be occupied, inspite of the utmost expedition, in the preparation and transmission of papers. Besides, their Lordships of do not hold their sittings continuously throughout the year, and weeks may elapse before the most diligent of suitors is able to obtain special leave to appeal to His Majesty in Council; if, meanwhile, his properties are allowed to be sold up by the decree-holders on the theory that this is powerless to interfere, not only may an application for stay after the grant of the special leave, as contemplated by in v. 38 I.A. 74; 38 C. 335; 13 C.L.J. 529; 11 Ind. Cas. 384; 8 A.L.J. 449; 13 Bom. L.R. 419; 10 M.L.T. 25; (1911) 2 M.W.N. 124; 4 Bur. L.T. 123 (P.C.) become infructuous, but the appeal admitted by special leave of their Lordships of may turn out to be wholly illusory and ineffectual. ", "2. It cannot seriously be maintained that the grant of a stay in any way throws doubt on the decree or weakens its effect; the stay is granted on the principle that the parties should, if the circumstances justify the adoption of such a course, be retained in status quo till the validity of the decree has been tested in the Court of ultimate appeal. ", "3. The exercise of the inherent power of the should thus be widened to aid the administration of justice and not unduly restricted so as to cause needless hardship to litigants and a possible failure of justice. I hold, therefore, that this has authority to grant this application. The stay, however, can be granted only for a limited time, and on terms. The rule, in my opinion, should be made absolute and execution proceedings stayed till the 30th November 1912, and the below directed to value the mortgage properties and the judgment-debtors called upon to furnish security for so much of the judgment debt as may exceed the value so determined; if security is not furnished within a time to be prescribed by the below, the decree-holders will be entitled to proceed with execution of their decree. ", "4. The Rule is made absolute on these terms, under Clause 36 of the Letters Patent, but there will be no order for costs. ", "Holmwood, J. ", "5. I am not prepared to differ from my learned brother upon the general point he makes that this has inherent power to make such orders as may be necessary for the ends of justice or to prevent abuse of the process of the . But there are numberless cases where the parties come to this asking for a relief which it is not competent for them to seek, and the does not in practice make use of its inherent powers to extend a procedure, which does not apply to a particular case, to such a case. For instance, the does not ordinarily allow an application for revision to be treated as an appeal, far less does the go outside its own walls to deal with parties who have no pending litigation before it. ", "6. To my mind, the use of the inherent power in this case would be an abuse of the process of the . ", "7. Here is a case of a mortgage suit, valued at less than Rs. 10,000, which was dismissed in the Court of first instance but decreed on appeal to this Court on the 16th February 1911. The defendants applied to this Court for leave to appeal to His Majesty in Council. This application was refused on the 19th March 1912, and the suit being of less value than Rs. 10,000 admittedly, it must be assumed that the , dealing with matters, held after full consideration that no substantial point of law arose in the case. The decree of the Court of the 16th February 1911 is, therefore, res judicata between the parties, and we cannot go into the merits of the case and say that this is a case where a stay of execution should be granted. ", "8. The parties are not properly before the and I do not think they have any right to come before the . Their only remedy is to go to for special leave to appeal to His Majesty in Council. Until they do this, they have no footing whatever for further litigation in this matter. ", "9. There is no question of using our inherent powers to right a wrong or to prevent the abuse of the process of this Court. We are bound to hold that the decree of this Court of the 16th February 1911, which under the rules is obnoxious to appeal to , is a good and just decree and one which ought to be executed. ", "10. That is the view I am prepared to hold, since, in my opinion, the applicants for special leave to are not entitled to be heard to the contrary. They are barred by the principle of res judicata, and, speaking for myself, I am not prepared to hold that the decree of 16th February 1911 was not a good and just decree and was not final as far as this is concerned. It is to my mind clear that it cannot be a proper use of the inherent powers of this to impede the execution of the final decrees of this , and I do not see why this should not use its inherent powers to help the decree-holder who has obtained a good decree rather than help the judgment-debtor who has no locus standi to delay the course of justice. ", "11. I am strongly averse to staying execution, where the law does not expressly authorise it, except on very good grounds shown to the satisfaction of the . ", "12. I have never been able to see why the interests of the decree-holder should not be just as worthy of consideration as those of the judgment-debtor, and I do not feel myself either called upon to interfere or justified in interfering with a perfectly competent, good and just proceeding in execution. ", "13. As the Rule is to be made absolute, I may say that the applicant to has practically gained all he wanted, by this application, and I can see no objection to adjourning the matter to the 30th November, which is the practical effect of the order with the additional advantage to the decree-holder of the security ordered."], "relevant_candidates": ["0000288442", "0000306823", "0000642898", "0001041371", "0042861557"]} {"id": "0000477921", "text": [", J. ", "1. Now that we have had the document of 27th August 1897 translated, I think that the appellants being the tangals are clearly entitled to the money which represents the share assigned to the mosque by . By that document he gave the tangals power to collect his share of the estate of . They would, I apprehend, have been entitled to demand from the Collector the whole of 's share in the particular fund, and having collected it to keep a third for the mosque. In my opinion this is not a case to which the doctrine of must can be applied, assuming that the doctrine is in force in this Presidency. I would reverse the award and remand the case for disposal according to law. will be abide the result. ", ", ", "2. In this case one is said to have held a kanom (usufructuary mortgage) over certain land for Rs. 100. On his death his rights as kanomdar are said to have passed to hits widow, his half-sister and his father's brother's son's son, , as sharers under , This assigned one-third of his share by a registered deed of gift to the seventh and eighth defendants in the suit. The land was taken up under the Land Acquisition Act , and the seventh and eighth defendants claimed a share of the compensation paid. ", "3. The Subordinate Judge disallowed their claim on the ground that the gift was invalid under , because the property given was not put into possession of the donees, and also because what was given was an undefined share and therefore invalid according to by reason of \"musha\" or confusion. The questions raised for our determination are-- ", "(1) Whether the rules of Muhammadan Law are applicable to the case? and (2) If so, whether the gift is invalid according to that law? ", "4. I am of opinion that the Muhammadan Law as such and of its own force has no application, but the rule which would be applicable to such a case under Muhammadan Law may be applied by us if it is in accordance with justice, equity and good conscience to do so, This is clear from Section 16 of the Madras Civil Courts Act, 1873, which enacts as follows: ", "Where, in any suit or proceeding, it is necessary for any Court under this Act to decide any question regarding succession, inheritance, marriage or caste, or any religious usage or institution; ", "(a) The Muhammadan Law in cases where the parties are Muhammadans, and the Hindu Law in cases where the parties are Hindus; or ", "(b) Any custom (if such there be) having the force of law and governing the parties or the property concerned, shall form the rule of decision unless such law or custom has by legislative enactment been altered or abolished; ", "(c) In cases where no specific rule exists the shall act according to justice, equity and good conscience. ", "5. The validity of the gift in this case is not \"a question regarding succession, inheritance, marriage or caste, or any religious usage or institution,\" and therefore the rules of Muhammadan Law with regard to gifts are not necessarily the rules by which we should decide the question. This view is in accordance with that of of the Allahabad High Court in v. All. 775 at p. 815. In construing the Bengal Civil Courts Act, 1871, the terms of which are similar to those of the Madras Civil Courts Act, it was there held that \"the Court is not bound to administer the Muhammadan Law in claims of pre-emption, but on grounds of equity that law has always been administered as between them in claims for pre-emption.\" ", "6. Again in the Full Bench case of Sheikh v. 4 B.L.R. 134 at p. 169, Sir , C.J., says at page 169, \"The Muhammadan Law is not the Law of British India, It is only the law so far as the laws of India have directed it to be observed. ...We are bound by Regulation IV of 1793, except so far as that law has been modified by Regulation VII of 1832.\" He then refers to Section 15 of the former Regulation which is, for our present purposes, similar in terms to the Bengal Civil Courts Act, 1871, and to Section 16 of the Madras Civil Courts Act. So also in the case of v. 6 M.H.C.R. 26 at p. 31 , Ag. C.J., says: \"The Muhammadan Law binds Muhammadans no more than others except in the matters to which it is declared applicable. It is then law because of its reception as one of our law sources in the matters to which it applies. Where, however, not so received, it can only be prevailing law because consistent with equity and good conscience\".... \"The question, therefore, resolves itself into whether it is consistent with equity and good conscience to import an exceptional rule opposed to the principle of law administered here.\" He then examined the ground on which the rule of Muhammadan law as to pre-emption sought to be enforced in that case was founded, and concluded I am of opinion that it is manifestly opposed to both (equity and good conscience), and that no such obligation in this Presidency binds a Muhammadan or any one else.\" ", "7. It was suggested in argument that Section 129 of the Transfer of Property Act by implication makes the Muhammadan Law applicable, but this is not so. Section 129 merely enacts that \"nothing in this chapter (as to gifts) shall be deemed to affect any rule of Muhammadan Law.\" that is, if there is any rule of Muhammadan Law which is administered as law by the , it shall not be affected by anything in this chapter. It will continue to be administered as law by the just as if this chapter was not enacted. In considering this section of the Transfer of Property Act and also in considering the case law of other parts of India it is necessary to bear in mind that in the Civil Acts of many Provinces the Muhammadan Law of gifts is specifically declared to be applicable in those Provinces as between Muhammadans (e.g., , Section 5 , Act XX of 1875; Punjab, Section 5 , Act XII of 1878; Oudh, Section 3 , Act XVIII of 1876). In those Provinces the Muhammadan Law as to gifts applies by virtue of the Civil Acts and is not affected by the rules of the Transfer of Property Act as to gifts. In other parts of India rules of Muhammadan Law, though not made applicable by legislation, have been adopted by the as in accordance with equity and good conscience and have been consistently enforced, as such, between Muhammadans. Some of the rules of the Muhammadan law of pre-emption have, in this way, been adopted in Bengal and in the North West Provinces, though not in Madras. Such rules would apparently be unaffected by the Transfer of Property Act so long as the continued to enforce them as being in accordance with equity and good conscience. ", "8. Turning now to the facts of the present case, I am of opinion that the gift is not invalid for either of the reasons assigned by the Subordinate Judge. The rule of with regard to \"musha\" is defined by as the rule \"that a gift of an undivided share in a subject capable of division is not good because it would lead to confusion.\" We have not been referred to, nor am I aware of any case in which this Court has held that the rule as laid down in is applicable in this Presidency. In the case of v. Shaik Mira I.L.R. 13 Mad. 46, a father having a share in a house gave to his daughter a moiety of the share to which he was entitled. Objection was taken to the validity of the gift because of confusion or musha, but the Court held that the gift was not void for indefiniteness. I can see no reason why the present gift should be regarded as more indefinite or more likely to lead to confusion than the gift in that case. In case already referred to v. Hosseini Bibi L.R. 15 I.A. 81; I.L.R. 15 Calc. 684, at p. 701 their Lordships referring to the doctrine of musha observed that by one of two sharers might give his share to the other and add \"supposing there are three sharers what is there to prevent one of the three giving his share to either of the other two? Mr. was asked what confusion that would introduce. Mr. took refuge in the doctrine itself which he said was a very refined doctrine. To extend it to this case would be a refinement on a refinement amounting, in their Lordships' opinion, almost to a reductio ad absurdum\" (page 701). The fact seems to be that the doctrine of musha is a vague and shadowy one. There is nothing to show that it has been adopted by the in this Presidency, nor is there any reason in equity and good conscience why we should hold that the present gift is invalid because of indefiniteness. ", "9. With regard to the objection that possession was not given to the donees, I observe that the Muhammadan Law adopted by our Courts does not; require immediate possession to be given in all cases, and it may be doubted whether even the restricted rule as to possession is any longer adapted to modern requirements and whether the mode of transfer laid down as obligatory on Europeans and Hindus by Section 123 of the Transfer of Property Act and adopted by the parties in this case, viz., by registered instrument attested by two witnesses and signed by the donor, ought not in equity and good conscience to be held to be as efficacious as delivery of possession in the case of Muhammadans. The certainty, publicity and formality which attend delivery of possession, are at least as well secured by a registered and attested instrument, and no case has been quoted in which a transfer evidenced in this way has been held to be invalid in this Presidency for want of delivery of possession. ", "10. In the case of 5 M.H.C.R. 114 the document was apparently not registered and the donor continued to take the profits of the land until her death. How-over that may be, in the case of v. Hosseini Bibi L.R. 15 I.A. 81 : I.L.R. 15 Calc. 684 already referred to, held that it was not necessary for the donor to give immediate possession to the ; and that where the instrument entitles the donee to take possession and the donor has done all in his power to perfect the contemplated gift, no objection can be taken to the gift on the score of want of possession by the donor or because possession was not given to the donee at the time. In this case exhibit I gives the authority to realize the property \"from tenants and others who are in possession\" by means of suits or by negotiation. The gift, therefore, cannot be regarded as invalid for want of possession in the donor or at the time of transfer. ", "11. I would therefore set aside the award of the Subordinate Judge and remand the petition for disposal according to law."], "relevant_candidates": ["0000057885"]} {"id": "0000478730", "text": ["PETITIONER: UNION OF INDIA & . Vs. RESPONDENT: K.S. SUBRAMANIAN DATE OF JUDGMENT30/07/1976 BENCH: , M. HAMEEDULLAH BENCH: , M. HAMEEDULLAH RAY, A.N. (CJ) , JASWANT CITATION: 1976 AIR 2433 1977 SCR (1) 87 1976 SCC (3) 677 CITATOR INFO : F 1982 SC1407 (26) R 1985 SC1293 (122) RF 1988 SC 501 (5) R 1988 SC1531 (46) F 1989 SC1335 (33) ACT: Central Civil Service (Classification, Control and Ap- peal) Rules, 1965 Scope of--Rules applicable only when disciplinary proceedings are taken. Constitution of India, 1950, Arts. 309, 310 and 311--scope of Art. 310 vis-a-vis, Arts. 309 and 311. Practice--Duty of where there is conflict between the views expressed by Divisional benches and larger benches of . HEADNOTE: Respondent was a welder in . On his services being terminated, without stating any rea- son, he filed a suit for damages for illegal termination on the basis that he would have continued in service upto the age of 60 instead of being thrown out at the age of 41. gave a decree for damages which was affirmed by the on the ground. that the doctrine of post held during the pleasure of the President, contained in Art. 310 , does not authorise the termination without complying with the procedure prescribed by (Classification, Control and Appeal) Rules, 1965, framed under Art. 309. Allowing the appeal to this Court, HELD: (1) The Rules deal principally with the procedure for disciplinary proceedings and penalties and appeals and reviews against orders passed under the rules. They are applicable if disciplinary proceedings had been taken against the respondent, but they do not make disciplinary proceedings incumbent or obligatory whenever the services of a person are terminated. In the present case there were no disciplinary proceedings against the respondent. [92 D-E] (2) The mere termination of the service. by an apparent- ly innocent order, of a Government servant in permanent service, in the sense that he is entitled to remain in service until he reaches the age of retirement, could be deemed, in a given case, to be a punishment. But, in that event, there had to be a finding on the rule or order under which the respondent was entitled to continue in service until he reached the age of 60. There is no reference to any such rule and there was no finding that any punishment was imposed upon him or that his services were terminated as a measure of punishment for any wrong done by him or for incompetence. [94 C; 93 AIR 1958 SC 36 @ 47 referred to. (3) Even assuming that the respondent was constructive- ly punished, there is no legal obligation to apply the Rules. The legal obligation to apply them to every case of punishment, flows from the provisions of Art. 311 and is confined to holders of posts covered by Art. 311. But the provisions of Art. 311 do not apply to the respondent since they do not apply to the holder of a post connected with defence. [94 E] L.R. Khurana v. Union of India 3 SCR 908 followed. (4) Terefore, when no disciplinary proceedings are instituted, the Rules will not at all apply, and there is no other rule dealing with the conditions under which the service, such as that of the respondent. may be terminated. Since there was no violation of any rule no question of a conflict between a rule framed under Art. 309 and the doc- trine of pleasure contained in Art. 310 , which applies to all Government servants including those in the services connected with defence, arises in the present case. [94 G] 88 (5) The in dealing with the question consid- ered the view of of this Court in two cases, merely quoted the views expressed by larger of this Court, and then observed that these were insuffi- cient for deciding the point before it. The did not act correctly in thus skirting the views expressed by larger of this Court. The proper course for the was to try to find out and follow the opinions expressed by the larger in preference to those expressed by smaller . This practice is followed even by this Court and has crystallized into a rule of law. If, however, the was of opinion that the views expressed by larger of this Court were not applica- ble to the facts of the present case it should have said so, giving reasons in support. [92 A-C] JUDGMENT: ", "CIVIL APPELLATE JURISDICTION: Civil Appeal No. 212 of 1975. ", "(Appeal by Special Leave from the Judgment and Order dated 26-6-1974 of in A.S. No. 510/72). ", ", of India, and for the appellant. for the respondent. ", "The Judgment of the Court was delivered by J.--The and the Commander, Officer- incharge, Naval Base, Cochin, are the appellants before us by grant of special leave against a judgment and decree of a Division Bench of . The Division Bench had affirmed the decision of a learned subordinate Judge awarding Rs. 25,000/- as damages, together with inter- est @ 6% per annum, to the plaintiff-respondent for the illegal termination of the respondent's services. The plaintiff respondent was serving as a Welder, Grade II, in at the Naval Base, Cochin, at the time of this allegedly illegal termination of service by an order of 25th October, 1968, of the , . ", "Special leave was granted on condition that the appel- lants Will bear the costs of the respondent in any event. The point of law sought to be canvassed before us is: Does the doctrine that a Central Govt. servant holds his post \"at the pleasure of the President\", contained in Article 310 of the Constitution, authorise the passing of an order of termination of services, without assigning any reason what- soever, of the holder of a post \"connected with defence ?\" ", "There is no finding anywhere that the services of the plaintiff respondent were terminated as a measure of pun- ishment for any wrong done by him or for incompetence, although, a perusal of the pleadings would show that the appellants denied the assertions of the plaintiff respondent that he was efficient and entitled to promotions as he had qualified for them by passing certain tests. The Subordinate Judge had awarded only Rs. 25,000-. out of a claim of Rs. 75,000/- made on the ground that, but for illegal termination of the service of the plaintiff-respond- ent, the-plaintiff would have continued in service upto the age of 60 years and duty promoted instead of being thrown out of service at the age of 41. The plaintiff respondent alleged that the termination of his service, without giving any reason whatsoever, was contrary to, rules made under Article 309. A glance at paragraph 4 of the plaint shows that the violation of rules relating to conduct of disciplinary proceedings was alleged by the petitioner. In paragraph 5 of the plaint, however, he alleged: ", "\"As per the terms of appointment and the rules governing the service of the petitioner,, he is entitled normally to continue in service till the age of 60. If his service had not been terminated as per the impugned order, the petitioner would have been entitled to continue for a further period of 19 years and 8 months\". ", "He proceeded to assert: ", "\"Due to the illegal termination, the peti- tioner had lost a valuable right vested in him by virtue of his appointment and guaranteed by the Constitution of India and the rules framed thereun- der namely a right to continue in service for the full period of 19 years and 8 months and thus to gain a livelihood for himself and his family\". A perusal of the judgment of shows that the only point really considered by it was whether the pleasure of the President mentioned in Article 310 of the Constitution, can over-ride rules made under Article 309 of the Constitution. ", " had explained away a passage cited from (1) by observing that it did not support the argument that rules made under Article 309 of the Constitution did not control the pleasure of the President, under Article.310 , which was to be subject to matters otherwise expressly provided in the Constitution. The passage so explained away runs follows :. ", "\"If there is a specific provlsion in some part of the Constitution giving to a Government servant a tenure different from that provided for in Art. 310 , that Government servant is excluded from the operation of Art. 310. The said words refer, inter alia,, to Arts. 124, 148, 218 and 324 which provide that the Judges of , the Auditor General, the Judges of and the Chief Election Commissioner shall not be re- moved from their offices except in the manner laid down in those Articles. If the provisions of the Constitution specifically prescribing different tenures were excluded from Art. 310 , the purpose of that clause would be exhausted and thereafter the Article would be free from any other restrictive operation. In that event, Art. 309 and 310 should be read together, excluding the opening words in the latter Article, namely, \"Except as expressly provided by this Constitution\". Learned Counsel seeks to confine the operation of the opening words in Art. 309 to the provisions of the Constitution which empower other authorities to make rules relating to the conditions of service of certain classes of public servants:, namely Arts. 146(2), 148(5) and 229(2). That may:be so, but there is no reason why Art. 310. should (1) A.I.R. 1961 S.C. 751. ", "8--1003 SCI/76 be excluded therefrom. It follows that while Art. 310 provided for a tenure at pleasure of the President or the Governor, Art. 309 enables the legislature or the executive, as the case may be, to make any law or rule in regard, inter alia, to conditions of service without impinging upon the overriding power recognised under Art. 310\". ", " relied on .,(1) to hold that doctrine of office held at the pleasure of the President was subject to rules made under Article 309 of the Constitution, and pointed out that it was held, inter-alia, by of this Court (at p. 42): ", "\"A Government servant serving under holds his office at the pleasure of the President as provided in Article 310 of the Consti- tution. But this \"pleasure\" doctrine is subject to the rules or law made under Article 309 as well as to the conditions prescribed under Art.311 \". also relied on ,(2) where the same Division Bench of this Court had held inter-alia (at p. 111 ): ", "\" Article 310(1) of the Constitution declares that every person who is a member of Civil service of a or holds any civil post in a holds office during the pleasure of the Governor of a . But the pleasure doctrine embodied therein is subject to the other provisions in the Constitu- tion. Two other Articles in the Constitution which cut down the width of the power given under Article 310 (1) are Articles 309 and 311. Article 309 provides that subject to the provisions of the Constitution acts of the appropriate may regulate the, recruitment, and conditions of service of persons appointed, to public. services and posts in connection with the affairs of the or of any . Proviso to that Article says: ", "'Provided that it shall be competent for the President or such person as he may direct in the case of services and posts in connection with the affairs of the Union, and for the Governor of a State or such person as he may direct in the: case of services and posts in connection with the af- fairs of the State to make rules regulating the recruitment, and the conditions of service of persons appointed, to such services and posts until provision in that behalf is made by or under an Act of the appropriate under this article, and any rules so made shall have effect subject to the provisions of any such Act .\" ", " then referred to .,(3) a decision of 5 learned Judges of this Court, in which ., speaking for the Constitution Bench of this Court, (1) A.I.R. 1971 S.C. 40. (2) (1) S.C.C. 108 at 111. ", "(3) A.I.R. 1973 S.C. 2641 at 2645. ", "91 ", "while considering the power of the . to create, continue, and abolish a post said (at p. 2645): ", "\" Article 309 provides that subject to the. provisions of the Constitution, Acts of the appropriate may regulate the recruit- ment and conditions of service of persons appoint- ed, to public services and posts in connection with the affairs of the or of any . There- fore, Acts in respect of terms and conditions of service of persons are contemplated. Such Acts of must however be subject to the provi- sions of the Constitution. This attracts Article 310 (1). The proviso to Art. 309 makes it compe- tent to the President or such person as he may direct in the case of services and posts in connection with the affairs of the and for the Governor of a or such person as he may direct in the case of services and posts in con- nection with the affairs of the , to make rules regulating the recruitment and the conditions of service of persons appointed,, to such services and posts under the and the . These Rules and the exercise of power conferred on the delegate: must be subject to Article 310. The result is. that Article 309 cannot impair or affect the pleasure of the' President or the Gover- nor therein specified. Article 309 is, there- fore, to be. read subject to Article 310\". , after citing the passage set out above, said: \"We do not understand the above passage as suggesting that Article 310 cannot in any manner be controlled by Rules framed under Article 309\". ", "After a consideration of decisions of this in this manner it -expressed its views as follows: ", "\"These cases, we think, sufficiently indicate that while it may be open to the PreSident or to the Governor to dismiss a civil servant at pleas- ure, if Rules have been framed under Article 309 of the Constitution to regulate the mode and manner of termination of service, these .have to be com- plied with. This, we think, is reasonable and understandable enough on first principles. If the untrammelled pleasure of the President has been subjected to Rules framed by the President himself in regard to the manner of termination of service, the pleasure must be subject to such Rules\". of then re- corded its conclusion: ", "\"We are therefore of the opinion that in the instant case, the Civil Services (Classification, Control and Appeal) Rules, having been framed under Article 309 of the Constitution, the same had to be followed before the respondent's service was terminated. The same not having been admittedly complied with, the finding of the' below that the termination is illegal was correct and requires no interference. No arguments were addressed on the quantum of damages awarded\". ", "92 ", "We do not think that the difficulty before could be resolved by it by following what it consid- ered to be the view of of this . in two cases and by merely quoting the views expressed by larger benches of this and then observing that these were insufficient for deciding the point before . It is true that in each of the cases cited before , observations of this occur in a con- text different from that of the case before us. But, we do not think that acted correctly in skirting the views expressed by larger benches of this in the manner in which it had done this. The proper course for , in such a case, is to try to find out and follow the opinions expressed by larger benches of this in preference to those expressed by smaller benches of the That is the practice followed by this itself. The practice has now crystallized into a rule of law de- clared by this . If, however, was of opinion that the views expressed by larger benches of this were not applicable to the facts of the instant case it should have said so giving reasons supporting its point of view. ", "we have perused the Central Civil Service (Classifica- tion, Control and Appeal) Rules of 1965, (hereinafter re- ferred to as '1955 Rules') which deal principally with procedure for disciplinary proceedings and penalties and appeals and reviews against orders passed under the rules. There is no rule there dealing with the conditions under which a service such as that of the plaintiff respondent may be terminated. We fail to see any rule made under Article 309 of the Constitution which was violated by the impugned order of termination of service of the plaintiff-respondent. We do not consider ourselves called upon to. decide a ques- tion which has really not arisen in the case. before us. The 1965 Rules are applicable when disciplinary proceed- ings are taken. They do not make disciplinary proceedings under the rules incumbent or obligatory whenever the services of a person covered' by these rules are terminated. The obligation to follow the procedure for punishment laid down in the rules flows from the provisions of Article 311 of the Constitution. And, as the opening words of Arti- cle 310 show, the doctrine of office held at the pleasure of the' President does not apply to cases covered by Article ", "311. Rule 3 of the above mentioned rules begins. as follows: ", "\"3. Application.--(l ) These rules shall apply to every Government servant including every civilian Government servant in the Defence Serv- ices, but shall not apply to- ", "(a) any railway servant, as defined in rule 102 of volume I of the Indian Railway Establishment Code, ", "(b) any member of , (c) any person in casual employment, ", "(c) any person in casual employment, ", "(d) any person subject to discharge from service on less than one month's notice. ", "(e) any person for whom special provision is made, in respect of matters covered by these rules, by or under any law for the time being in force or by or under any agreement entered into by or with the, previous approval of the President before or after the commencement of these rules, in regard to matters covered by such special provisions; ", "(2) Notwithstanding anything contained in sub-rule (1), the President may by order exclude any class of Government servants from the operation of all or any of these rules. ", "(3) Notwithstanding anything contained in sub-rule (1), or the Indian Railway Establishment Code, these rules shall apply to every Government servant temporarily transferred to a Service or post coming within exception (a) or (e) in sub- rule (1 ), to whom, but for such transfer, these rules would apply. ", "(4) If any doubt arises- ", "(a) whether these rules or any of them apply to any person, or ", "(b) whether any person to whom these rules apply belongs to a particular service the matter shall be referred to the President, who shall decide the same\". ", "Even if the parties were governed by these rules, because the plaintiff held a civil post in one of the Defence; Departments, yet there must be some violation of one of these rules, which were no doubt framed under Article 309 read with clause 5 of Article 148 of the Constitution, before any question of a conflict between a rule framed under Article 309 and the provisions of Article 310 could possibly arise. We fail to see such a conflict here. These rules merely lay down procedure for matters cov- ered by Article 31 l of the Constitution. There is no doubt that proceedings under Article 311 of the Constitution constitute an exception to the doctrine of pleasure con- tained in Article 310 of the Constitution. But, in the case before us, no question of any disciplinary proceedings has been discussed because it did not arise at all. There is no finding that any punishment was imposed upon the plaintiff-respondent. It may be that mere termination of service, when the plaintiff.respondent was holding a perma- nent post and entitled to continue in service until 60 years of age, may constitute punishment per seven when the termination of service is not meant as a punishment. But, in that event,, there had to be a finding on the rule or order under which the plaintiff was entitled to continue in serv- ice. until he reached the age of 60 years. had cited no rule made under. Article 309 to show that there was any such provision. ", " (1) , CJ., speaking for the majority of a Bench of five judges of this Court, said (at p. 47): ", "\"It has already been said that where a person is appointed substantively to a permanent post in service. ", "(1) A.I.R. 1958 S.C. 36 at 47. ", "94 ", "he normally acquires a right to hold the post until under the rules, he attains the age of superannua- tion or is compulsorily retired and in the absence of a contract, express or implied, or a service rule,. he cannot be turned out of his post unless the post itself is abolished or unless he is guilty of misconduct, negligence, inefficiency or. other disqualifications and appropriate proceedings are taken under the service rules read with Art. 311 (2). Termination of service of such a servant so appointed must per se be a punishment, for it operates as a forfeiture of the servant's rights and brings about a premature end of his employ- ment\". ", "The propositions laid down in 's case (supra) by this, mean that, unless a legally justifiable ground is made out for the termination of the service of a Govern- ment servant. in permanent service, in the sense that he is entitled to remain in service until he' reaches the age of retirement, he could be deemed in a given case to be pun- ished by an apparently innocent order of termination of service. If, however, the respondent belonged to a class of government servants the tenure or conditions of whose serv- ice was subject to the over-riding and unqualified sway of the power to terminate his services at will, by reason of Article 310(1) of the Constitution, we doubt whether he could claim to be a \"permanent\" servant, who could continue, as of right, in service until he reaches the age of super- annuation. At any rate, he could not be a \"permanent\" Government servant of the same class as one protected by Article 311. ", "Even if we were to hold that the plaintiff-respondent was constructively punished, the provisions of Article 311 , unfortunately, do not apply to such a servant as the respondent was. Whereas the power contained in Article 310 governs all servants, including those in the services connected with defence, the benefits of Article 311 , which impose limitations on the exercise of this power in cases of punishment, do not extend to those who hold posts \"connected with defence\". Constitution Bench of this Court has held, after a review of relevant authorities, this to be the position of the. holder of a post such as that of the plaintiff-respondent in L. R: . (1) As the plaintiff-respondent was not entitled to the protection of Article 311 , the only effect of the 1965 Rules upon his case is that they could be applied if disci- plinary proceedings had been taken against him as the holder of a post \"connected with defence\". In other eases of such servants,. where no such disciplinary proceedings are instituted (and none were started against the plaintiff-respondent), the 1965 Rules, governing procedure for. punishments to be imposed, will not apply at all. There is no legal obligation to apply those rules here. The legal obligation to apply them to every case of punish- ment, flowing from Article 311 , is confined to holders of posts covered by Article 311. On this question, we are bound by the decision of a bench of five learned Judges of this Court in 's case (supra). (1) 3 S.C.R. 908. ", "95 ", "We were asked to import the obligation to apply the procedure prescribed by Article 311 to a case such as the one before us by invoking the aids of Articles 14 and 16. Apart from the fact that these .Articles could not be in- voked against a discrimination made by Constitutional provi- sions, no such case was set up earlier. We cannot permit it at this stage. ", "The only ground on which the respondent had assailed the order of termination of his service was non-compliance of 1965 Rules, which meant' that he claimed the protection of Article 311 of the Constitution. But for the reasons given above, this protection is not available to him. Therefore, this appeal must succeed. ", "Consequently, we allow this appeal, set aside the judgment and decree of and ,dismiss the plaintiff's suit. But: in the circumstances of the case, the appellant will, in keeping with the undertaking given at the time of grant of special leave, bear the costs of both sides throughout. ", "Appeal allowed. ", "V.P.S. ", "96"], "relevant_candidates": ["0000047629", "0000303704", "0000336923", "0001270113", "0001540511", "0001930667"]} {"id": "0000490205", "text": ["PETITIONER: BABU LAL Vs. RESPONDENT: KlSHORI LAL & ORS. DATE OF JUDGMENT29/01/1982 BENCH: MISRA, R.B. (J) BENCH: MISRA, R.B. (J) SEN, A.P. (J) CITATION: 1982 AIR 818 1982 SCR (3) 94 1982 SCC (1) 525 1982 SCALE (1)79 ACT: Specific Relief Act , sections 22 and 28 read with section 55 of the Transfer of Property Act, scope of- Section 22 of the Specific Relief Act enacts a rule of pleading in order to avoid multiplicity of proceedings-When the court has decreed the suit for specific relief of execution of the agreement to sale of an immovable property without a separate prayer for possession in the plaint, the decree is still executable without recourse to another separate suit for possession-Powers of to grant the relief in execution application. HEADNOTE: Pursuant to an agreement for sale of certain plots for Rs. 15, 500 M/s. respondent No. 1 alongwith respondents 2 to 5 bad paid a sum of Rs. 1500/- as earnest money to respondents Nos. 6 to 9. The sale deed was to be executed within 15 days of the agreement. Respondents 6 to 9, how ever, executed a sale deed in favour of , the petitioner, in respect of the same property for Rs. 20,000 on 7th August, 1967. Under the circumstances, respondents 1 to 5 filed a suit (No. 10 of 1968) in the court of Civil Judge, , for specific performance of the contract of sale. The petitioner resisted the claim on the ground that the sale in his favour was in pursuance of a prior agreement dated 8th July, 1967. During the pendency of the suit, the petitioner started raising construction on the disputed plot after demolishing the old one. Respondents 1 to 5 applied for injunction restraining, the petitioner from doing so. The petitioner, however, gave an undertaking on 25th March, 1968, before that he was making the construction at his own peril and would demolish the same and restore the land to its original position in case the suit of the plaintiffs was decreed. The trial court dismissed the suit but on appeal the additional District Judge decreed the suit and in second appeal confirmed the judgment and decree of and directed the petitioner and respondents 6 to 9 to execute the sale deed in favour of respondents Nos. 1 to 5. The petitioner,, however, did not handover possession and remove the construction raised by him despite his undertaking dated 25th March, 1968. The decree-holders, therefore, applied for execution of the decree. The judgment-debtor-petitioner filed an objection under section 47 of the Code of Civil Procedure taking all possible pleas to defeat the execution. His objections were three-fold: (i) The decree was inexecutable as the decree-holders did not claim a relief for possession in the suit itself and consequently there was no decree for 95 possession with the result that the application for execution by delivery of possession was liable to be dismissed in view of section 22 (2) of the Specific Relief Act ; (ii) the Urban Land Ceiling Act having come into force it was incumbent on the decree-holders to obtain the permission as required under sections 26 and 27 of the Ceiling Act and in the absence of any such permission the application for execution was not maintainable; and (iii) the vendors were not impleaded as parties originally and they were impleaded as parties only after the court had directed the vendors to execute the sale deed. As the vendors were not parties in the execution application it was not maintainable and it was not open to the execution court to implead a person who was not originally impleaded in the application. The execution court allowed the objection of the judgment debtor in part inasmuch as it directed the execution of the sale deed in pursuance of the decree. It, however, refused to grant the relief of possession with the observation that the remedy of the decree-holders for possession was by means of a separate suit and not by execution proceedings. Objections (ii) and (iii) were overruled. The order of the execution court was confirmed in appeal by they First Additional District Judge, , dated 21st of February, 1977. allowed the appeal of the decree-holders and modified the order of the court below to the effect that the decree-holders shall be entitled to possession also. Hence the petition by special leave by judgment debtor-petitioner. Dismissing the petition, the . ^ HELD: 1. A decree for specific performance of a contract includes everything incidental to be done by one party or another to complete the sale transaction, the rights and obligations of the parties in such a matter being governed by section 55 of the Transfer of Property Act. [103 , A.I.R. 1952 Cal. 362; ., A.I.R. 1938 All. 432; , 37 Cal. 57; v. , 14 C.L.J. 159; , 5 Pat. L.J. 314; v. , A.l.R. 1931 Pat. 179; , A.I.R. All. 643; .l.R. 1957 Pat. 70l; , A.I.R. 1955 Cal. 267; ., A.I.R. 1973 Mysore 131, discussed. 2:1. Section 22 enacts a rule of pleading. The purpose of section 22 is to avoid multiplicity of suits and to enable the plaintiff to claim a decree for possession in a suit for specific performance without being hampered by procedural complications, even though strictly speaking, the right to possession accrues only when suit for specific performance is decreed, and empowers the court to provide in the decree itself that upon payment by the plaintiff of the consideration money within the given time, the defendant should execute the deed and put the plaintiff in possession. [104 E-F] 2:2. Though sub-section (2) of section 22 recognised in clear terms the well-established rule of procedure that the court should not entertain a claim of 96 the plaintiff unless it has been specifically pleaded by the plaintiff and proved by him to be legally entitled to, by its proviso it provides that where the plaintiff has not specifically claimed appropriate reliefs like possession, partition or separate possession including the specific performance in his plaint, in the initial stages of the suit, the court shall permit the plaintiff at any stage of the proceedings, to include one or more of the said reliefs, by means of an amendment of the plaint on such terms as it may deem proper. [105 ., A.I.R. 1975 Delhi 155; , A.I.R. 1976 Delhi 56; , A.I.R. 1956 All. 586, approved. 2:3. The expression \"in an appropriate case' only indicates that it is not always incumbent on the plaintiff to claim possession or partition or separate possession in a suit for specific performance of a contract for the transfer of the immoveable property. That has to be done where the circumstances demanding the relief for specific performance of the contract of sale embraced within its ambit not only the execution of the sale deed but also possession over the property conveyed under the sale deed. It may not always be necessary for the plaintiff to specifically claim possession over the property, the relief of possession being inherent in the relief for specific performance of the contract of sale. Besides, the proviso to sub-section (2) of section 22 provides for amendment of the plaint on such terms as may be just for including a claim for such relief \"at any stage of the proceedings\". [106 G-H, 107 A-B] 2:4. The term \"proceedings\" is a very comprehensive term and generally speaking means a prescribed course of action for enforcing a legal right. It is not a technical expression with a definite meaning attached to it, but one the ambit of whose meaning will be governed by the statute. It indicates a prescribed mode in which judicial business is conducted. The word \"proceeding\" in section 22 includes execution proceedings also. It is a term giving the widest freedom to a court of law so that it may do justice to the parties in the case. Execution is a stage in the legal proceedings. It is a step in the judicial process. It marks a stage in litigation. It is a step in the ladder. In the journey of litigation there are various stages. One of them is execution. The has given ample power to the court to allow amendment of the plaint at any stage, including the execution proceedings. In the instant case, rightly granted the relief of possession. [107 C-E, 109 , A.I.R. 1956 All. 586; : ", "A.I.R. 1954 All. 643; , A.I.R. 1976 Delhi 56, approved. ", "3:1. If once the legal position is accepted that neither a contract for sale nor a decree passed on that basis for specific performance of the contract gives any right or title to the decree-holder and the right and the title passes to him only on the execution of the deed of sale either by the judgment-debtor himself or by the court itself in case he fails to execute the sale deed, no valuable right can be said to have accrued to the petitioner judgment-debtor by lapse of time, merely because a decree has been passed for the specific performance of the contract. The limitation would start against the decree- holders only after they had obtained a sale in respect of the disputed property. Section 22 has been enacted . Only for the purpose of avoiding multiplicity of proceedings which the law courts always abhor. [109 D-F] 3:2. The only amendment to be made in the plaint was to add a relief for possession necessitated because of the provisions of section 22 , which is only an enabling provision. In the instant case, the objection of the petitioner requiring the decree-holders to file a separate suit for possession is hyper-technical. The execution court has every jurisdiction to allow the amendment. The mere omission of to allow an amendment in the plaint is not so fatal as to deprive the decree-holders of the benefits of the decree when section 55 of the Transfer of Property Act authorises the transferee to get possession in pursuance of a sale deed. It was open to the to allow an amendment, on the basis of section 22 indeed, it has allowed delivery of possession in pursuance of the decree passed in the case. [109 F-G, H, 110 A-B, E] 3:3. Further, sub-section (3) of section 28 clearly contemplates that if the purchaser or lessee pays the purchase money or other sum which he is ordered to pay under the decree, the may on application made in the same suit, award the purchaser or lessee such further relief as he may be entitled to. Sub-clause (b) of sub-section (3) of section 28 contemplates the delivery of possession or partition and separate possession of the property on the execution of such conveyance or lease. Sub-section (4) of section 28 bars the filing of a separate suit for any relief which may be claimed under section 28 . [112 A-C] 3:4. The High had amended the decree passed by the first appellate court and passed a decree for possession not only against the transferors but also against their transferee, that is, the petitioner. A court which passes a decree for specific performance retains control over the decree even after the decree has been passed. Procedure is meant to advance the cause of justice and not to retard it. [112 G-H, 113 ., A.I.R. 1972 S.C. 1826, reiterated. ", "& CIVIL APPELLATE JURISDICTION : Petition for Special Leave to Appeal (Civil) No. 7771 of 1981. ", "From the Judgment and order dated the 2nd September, 1981 of in Execution second Appeal Nos. 1001 & 1720 of 1977 and Civil Revision No. 1447 of 1978. ", "98 ", " for the Petitioner. ", "Mrs. for the Respondent. ", "The Judgment of the Court was delivered by This is a petition for special leave to appeal against the judgment and order dated 2nd of September, 1981 passed by at Allahabad disposing of Execution Second Appeal No. 1001 and 1720 of 1977 and Civil Revision No. 1447 of 1978. The petition was heard on 7th of December, 1981 at some length and after hearing the counsel for the parties we dismissed the same for reasons to be recorded later. We Dow proceed to give the reasons. ", "The present petition is a typical example of the desperate effort of the judgment debtor to ward off the execution of the decree till the bailiff knocks at the door. Respondents Nos. 6 to 9 entered into an agreement with respondents Nos. 1 to 5 on 30th of July, 1967 for sale of certain plots situate behind their shop for Rs. 15,500. Respondents Nos. 1 to 5 had paid a sum of Rs. 1,500 as earnest money pursuant to the agreement. The sale deed was agreed to be executed within fifteen days of the agreement. Respondents Nos. 6 to 9, however, executed a sale deed in favour of the petitioner in respect of the same property for Rs. 20,000 on 7th of August, 1967 in defiance of the earlier agreement dated 30th of July, 1967. Under the circumstances respondents Nos. 1 to 5 were obliged to file a suit which was later on numbered as suit No. 10 of 1968 in , Aligarh for specific performance of the contract of sale. The petitioner resisted the claim on the ground that the sale in his favour was in pursuance of a prior agreement dated 8th of July, 1967. It appears that during the pendency of the suit the petitioner started construction on the disputed plot after demolishing the old construction. The plaintiffs, therefore, filed an application for an injunction restraining the petitioner from making any construction. The petitioner, however, gave an undertaking on 25th of March, 1968 that he was making the construction at his own peril and would demolish the construction and restore the land to its original position in case the suit of the plaintiffs was decreed. It appears that on the undertaking given by the petitioner the application for injunction was dismissed. The trial court dismissed the suit but on appeal the District Judge decreed the suit. In Second Appeal confirmed the judgment and decree of the first appellate court with a slight modification inasmuch as directed the petitioner and respondent Nos. 6 to 9 to execute the sale deed in favour of the respondents Nos. 1 to 5, to bring it in line with the decision of in . wherein it was held: ", "\"In a suit instituted by a purchaser against the vendor and a subsequent purchaser for specific performance of the contract of sale, if the plaintiff succeeds, the proper form of the decree to be passed is to direct specific performance of the contract between the vendor and the plaintiff and direct the subsequent transferee to join in the conveyance so as to pass on the title which resides in him to the plaintiff.\" ", "The petitioner, however, did not handover possession and remove construction raised by him despite his undertaking dated 25th of March, 1968. The decree holders, therefore, applied for execution of thee decree. The judgment-debtor-petitioner filed an objection under section 47 of the Code of Civil Procedure taking all possible pleas to defeat the execution. His objections were three-fold: (1) The decree was inexecutable as the decree-holders did not claim a relief for possession in the suit itself and consequently there was no decree for possession. The application for execution by delivery of possession was liable to be dismissed on this score alone in view of section 22(2) of the Specific Relief Act. (2) The Urban Land Ceiling Act having come into force it was incumbent on the decree-holders to obtain the permission as required under sections 26 and 27 of that Act and in the absence of any such permission the application for execution was not maintainable (3) The vendors were not impleaded as parties originally and they were impleaded as parties only after the court had directed the vendors to execute the sale deed in Second Appeal. As the vendors were not parties in the execution application it was not maintainable and it was not open to the execution court to implead a person who was not originally impleaded in the application. The execution court allowed the objection of the judgment-debtor in part inasmuch as it directed the execution of the sale deed in pursuance of the decree. It, however, refused to grant the relief of possession with the observation that the remedy of the decree-holders for possession was by means of a separate suit and not the execution proceedings. The other two objection were, however, overruled. The order of the execution court was confirmed in appeal by the First District Judge, dated 21st of February, 1977. This order gave rise to two appeals, one by the judgment-debtor, being appeal No. 1720 of 1977, and the other by the decree-holders, being execution second appeal No. 1001 of 1977 to the extent the order went against them. There was yet another revision filed by the judgment-debtor petitioner, being civil revision No. 1447 of 1978 against the order dated 15th of March, 1978 whereby the judgment-debtor was directed to execute a sale deed in favour of the decree holders without obtaining permission from under sections 26 and 27 of the Act. The appeal as well as the revision filed by the judgment-debtor were dismissed while the appeal of the decree-holders was allowed and the order of the courts below was modified to the effect that the decree-holders shall be entitled to possession also. The judgment-debtor petitioner has now come to this Court to seek permission to file an appeal against the judgment of dated 2nd of September, 1981. ", "Only one contention has been raised on behalf of the petitioner by Mr. , senior counsel, that could not grant relief in execution application in excess of and out side the framework of the prayer by the plaintiffs in the original main suit. As a second limb to this argument it was further contended that has acted in flagrant violation of the provisions of section 22 of the Specific Relief Act in granting the relief of possession. In substance, the main plank of the contention of the petitioner is based on section 22 of the Specific Relief Act. As it stands after amendment of 1963, it reads: ", "\"22(1) Notwithstanding anything to the contrary contained in the Code of Civil Procedure, 1908 (5 of 1908), any person suing for the specific performance of a contract for the transfer of immovable property may, in an appropriate case, ask for- ", "101 ", "(a) possession, or partition and separate possession, of the property, in addition to such performance; or ", "(b) any other relief to which he may be-entitled, including the refund of any earnest money or deposit paid or made by him, in case his claim for specific performance is refused. ", "(2) No relief under Cl. (a) or Cl. (b) of sub-section (1) shall be granted by the unless it has been specifically claimed: ", "Provided that where the plaintiff has not claimed any such relief in the plaint, the shall, at any stage of the proceeding, allow him to amend the plaint on such terms as may be just for including a claim for such relief. ", "(3) The power of the to grant relief under Cl. ", "(b) of sub-section (1) shall be without prejudice to its power to award compensation under Sec. 21.\" ", "Mr. was laying emphasis on sub-section (2) of section 22 to contend that tho plaintiffs having not claimed any relief for possession in the suit they cannot claim the same relief at a subsequent stage. According to him, in face of the clear mandate of sub-section (2) it was not open to to have allowed the relief of possession at the execution stage, and in any case without an amendment of the plant. ", "The contention at the first flush appears to be alluring and plausible but on a closer scrutiny it cannot be accepted. ", "It would be appropriate to refer to the state of law as it existed prior to the amendment of the Specific Relief Act in 1963. One view was that the decree-holder does not acquire title or right to recover possession unless a sale deed is executed, in execution of the decree for specific performance. a Division Bench of dealing with the question observed; ", "102 ", "\"A decree for specific performance only declares the right of the decree-holder to have a transfer of the property covered by the decree executed in his favour. The decree by itself does not transfer title. That this is so is apparent from the fact that in order to get title to the property the decree-holder has to proceed in execution in accordance with the provisions of 0.21 of the Code. So long as the sale deed is not executed in favour of the decree holder either by the defendant in the suit or by the the title to the property remains vested in the defendant and till the execution of the sale deed the decree-holder has no right to the possession of the property. It is only the execution of the sale deed that transfers title to the property.\" ", " a Division Bench of the Calcutta High Court, however, after reviewing a number of reported cases, viz., . v. , , and v. Barada Prasad, observed; ", "\"It is incontestable that in a suit for specific performance of contract for the sale of land it is open to the plaintiff to join in the sale suit two prayers, one for the execution of the deed of transfer and another for recovery of possession of the land in question. ", "We ought to remember in this connection that no special form of decree in a suit for specific performance is supplied by the Civil Procedure Code. ", "Chapter 11, Specific Relief Act , deals with the various circumstances under which a contract may be enforced specifically and where it cannot be allowed. When a contract is to be specifically enforced, it means simply this that when the parties do not agree to perform the contract mutually the intervention of the is required and the will do all such things as the parties would have been bound to do had this been done without the intervention of the . A sale of a property after payment of the consideration and upon due execution of the deed of sale presupposes and requires the vendor to put the purchaser in possession of the property. It cannot be suggested that when a party comes to for a specific performance of a contract he is to be satisfied with simply the execution of the document on payment of the consideration money. The when allowing the prayer for specific performance vests the executing court with all the powers which are required to give full effect to the decree for specific performance. By the decree for specific performance, the court sets out what it finds to be the real contract between the parties and declares that such a contract exists and it is for the executing court to do the rest, In may be noticed further that a decree in a suit for specific performance has been considered to be somewhat in the nature of preliminary decree which cannot be set out in the fullest detail all the different steps which are required to be taken to implement the main portion of the order directing specific performance of the contract. The executing court is in such a case vested with authority to issue necessary directions.\" ", " the decree for specific performance of a contract of sale was silent as to the relief of delivery of possession even though such relief was claimed in the suit. It was held by that the executing court was still competent to deliver the possession. It was further held that it was not necessary in a suit for specific performance either to separately claim possession nor was it necessary for the court to pass a decree for possession. A decree for specific performance of a contract includes everything incidental to be done by one party or another to complete the sale transaction, the rights and obligations of the parties in such a matter being governed by section SS of the Transfer of property Act. Court took the view that the relief of procession is inherent in a relief for specific performance of contract for lease, and the court executing a decree for specific performance of such a contract can grant possession of the property to the decree-holder even though the decree did not provide for delivery of possession. Court took a similar view that the right to recover possession springs out of the contract which was being specifically enforced and not as a result of the execution and completion of the conveyance, and as such the judgment-debtor was bound to deliver possession to the decree-holder. ", " Court observed that the liability to deliver possession for specific performance was necessarily implied in a decree for specific performance directing the defendant to execute a sale deed on the principle of clause (f) of sub-section of section 55 of the Transfer of property Act, according to which the liability to deliver possession arises immediately upon execution of sale deed unless by agreement the date for delivery of possession is postponed. ", "In this state of the law intervened and on the basis of the report of enacted section 22 in 1963 as it stands. ", " Section 22 enacts a rule of pleading. The thought it will be useful to introduce a rule that in order to avoid multiplicity of proceedings the plaintiff may claim a decree for possession in a suit for specific performance, even though strictly speaking, the right to possession accrues only when suit for specific performance is decreed. The has now made a statutory provision enabling the plaintiff to ask for possession in the suit for specific performance and empowering the court to provide in the decree itself that upon payment by the plaintiff of the consideration money within the given time, the defendant should execute the deed and put the plaintiff in possession The section enacts that a person in a suit for specific performance of a contract for the transfer of immovable property, may ask for appropriate reliefs, namely, he may ask for possession, or for partition, or for separate possession including the relief for specific performance. These reliefs he can claim, not- withstanding anything contained in the Code of Civil Procedure, 1908, to the contrary, Sub-section (2) of this section, however, specifically provides that these reliefs cannot be granted by the , unless they have been expressly claimed by the plaintiff in the suit. Sub-section (2) of the section recognised in clear terms the well- established rule of procedure that the court should not entertain a claim of the plaintiff unless it has been specifically pleaded by the plaintiff and proved by him to be legally entitled to. The proviso to this sub-section (2), however, says that where the plaintiff has not specifically claimed these reliefs in his plaint, in the initial stage of the suit, the court shall permit the plaintiff at any stage of the proceedings, to include one or more of the reliefs, mentioned above by means of an amendment of the plaint on such terms as it may deem proper. The only purpose of this newly enacted provision is to avoid multiplicity of suits and that the plaintiff may get appropriate relief without being hampered by procedural complications. ", "The expression in-sub-section (1) of section 22 'in an appropriate case' is very significant, The plaintiff may ask for the relief of possession or partition or separate possession 'in an appropriate case'. As pointed out earlier, in view of order 2, rule 2 of the Code of Civil Procedure, some doubt was entertained whether the relief for specific performance and partition and possession could be combined in one suit; one view being that the cause of action for claiming relief for partition and possession could accrue to the plaintiff only after he acquired title to the property on the execution of a sale deed in his favour and since the relief for specific performance of the contract for sale was not based on the same cause of action as the relief for partition and possession, the two reliefs could not be combined in one suit. Similarly, as a case may be visualized where after the contract between the plaintiff and the defendant the property passed in possession of a third person. A mere relief for specific performance of the contract of sale may not entitle the plaintiff obtain possession as against the party in actual possession of the property. As against him, a decree for possession must be specifically claimed or such a person is not bound by the contract sought to be enforced. In a case where exclusive possession is with the contracting party, a decree for specific performance of the contract of sale simpliciter without specifically providing for delivery of possession, may give complete relief to the decree-holder. In order to satisfy the decree against him completely he, is bound not only to execute the sale-deed but also to put the property in possession of the decree-holder. This is no consonance with the provision of section 55 (1) of the Transfer of Property Act which provides that the seller is bound to give, on being so required, the buyer or such person as he directs, such possession of the property as its nature admits. ", "There may be circumstances in which are lief for possession cannot be effectively granted to the decree- holder without specifically claiming relief for possession, viz., where the property agreed to be conveyed is jointly held by the defendant with other persons. In such a case the plaintiff in order to obtain complete and effective relief must claim partition of the property and possession over the t share of the defendant. It is in such cases that a relief for possession must be specifically pleaded. ", "In the instant case, it is pointed out on behalf of the petitioner that the possession was not with the respondents Nos. 6 to 9 but was with a third person namely, the petitioner, who was subsequent purchaser and, therefore. this was an appropriate case where the relief for possession should have been claimed by the plaintiff-respondents Nos. 1 to 5. ", "It may be pointed out that the Additional Civil Judge had decreed the suit for specific performance of the contract. modified decree to the extent that the sale deed was to be executed by respondents Nos. 6 to 9 together with the petitioner. In short, the decree was passed by not only against respondents Nos. 6 to 9 but also against the subsequent purchaser i.e., the petitioner and thus the petitioner was himself the judgment debtor and it cannot be said that he was a third person in possession and, therefore, relief for possession must be claimed The contention on behalf of the petitioner is that the relief for possession must be claimed in a suit for specific performance of a contract in all cases'. This argument ignores the significance of the words 'in an appropriate case'. The expression only indicates that it is not always incumbent on the plaintiff to claim possession or partition or separate possession in a suit for specific performance of a contract for the transfer of the immovable property. That has to be done where the circumstances demanding the relief for specific performance of the contract of sale embraced within its ambit not only the execution of the sale deed but also possession over the property conveyed under the sale deed. It may not always be necessary for the plaintiff to specifically claim possession over the property, the relief of possession being inherent in the relief for specific performance of the contract of sale. Besides, the proviso to sub-section (2) of section 22 provides for amendment of the plaint on such terms as may be just for including a claim for such relief 'at any stage of the proceedings'. ", "The word 'proceeding' is not defined in the Act. Shorter Oxford Dictionary defines it as \"carrying on of an action at law, a legal action or process, any act done by authority of a court of law; any step taken in a cause by either party\". The term 'proceeding' is a very comprehensive term and generally speaking means a prescribed course of action for enforcing a legal right. It is not a technical expression with a definite meaning attached to it, but one the ambit of whose meaning will be governed by the statute. It indicates a prescribed mode in which judicial business is conducted. The word 'proceeding' in section 22 includes execution proceedings also. such a view was taken. It is a term giving the widest freedom to a court of law so that it may do justice to the parties in. the case. Execution is a stage in the legal proceedings. It is a step in the judicial process. It makes a stage in litigation. It is a step in the ladder. In the journey of litigation there are various stages. One of them is execution. ", " Court endorsed the view taken in (supra) that where in a suit for specific performance of the contract for sale relief for possession is not claimed and consequently the decree passed in the suit contains no relief for delivery of possession. the court executing the decree is competent to deliver possession, an order directing delivery of possession being merely incidental to the execution of the deed of sale. The court however, observed that on March 1, 1964 Specific Relief Act of 1963 came into force and this Act altered the law by enacting section 22 . It made it necessary for the plaintiff to ask specifically the relief of possession in suits for specific performance. The Court, however, held that section 22 of the Specific Relief Act of 1963 had no appli- ", "108 ", "cation to that case as the decree was passed when the old Act was in force. ", "The same , however. in considered the effect of section 22 (2) with its proviso. In that case the decree did not give the plaintiff the relief of possession. The question arose. Was the Court powerless to put him in possession of the property though he had a decree for specific performance in his favour ? The Delhi observed: ", "\" Section 22 enacts a rule of pleading. The legislature thought it will be useful to introduce a rule that in order to avoid multiplicity of proceedings the plaintiff may claim a decree for possession in a suit for specific performance even though strictly speaking the right to possession accrues only when specific performance is decreed.. The legislature has now made a statutory provision enabling the plaintiff to ask for possession in the suit for specific performance and empowering the court to provide in the decree itself that upon payment by the plaintiff of the consideration money within the given time the defendant should execute the deed and put the plaintiff in possession. ", "In my opinion the proviso gives ample power to a court to allow the amendment of the plaint even at this stage. The proviso says that the amendment of the plaint can be allowed \"at any stage of the proceedings\" on such terms as may be just for including a claim for possession where the plaintiff has not claimed such relief in his original plaint. ", "The term \"proceeding\" is a very comprehensive term and generally speaking means a prescribed course of action for enforcing a legal right. It is not a technical expression with a definite meaning attached to it, but one the ambit of whose meaning will be governed by the statute. It indicates a prescribed mode in which Judicial business is conducted. ", "109 ", "The word \"proceeding\" in Section 22 in my opinion includes execution proceedings also.\" ", " had relied upon v. () for its decision in this case. We are in complete agreement with the view taken by on this case. ", "It is thus clear that the has given ample power to the court to allow amendment of the plaint at any stage, including the execution proceedings. In the instant case granted the relief of possession and the objection raised on behalf of the petitioner is that this was not possible at the execution stage and in any case the should have allowed first an amendment in the plaint and then an opportunity should have been afforded to the petitioner to file an objection. ", "If once we accept the legal position that neither a contract for sale nor a decree passed on that basis for specific performance of the contract gives any right or title to the decree-holder and the right and the title passes to him only on the execution of the deed of sale either by the judgment-debtor himself or by the itself in case he fails to execute the sale deed, it is idle to contend that a valuable right had accrued to the petitioner merely because a decree has been passed for the specific performance of the contract. The limitation would start against the decree-holders only after they had obtained a sale in respect of the disputed property. It is, therefore, difficult to accept that a valuable right had accrued to the judgment debtor by lapse of time. Section 22 has been enacted only for the purpose of avoiding multiplicity of proceedings which the law courts always abhor. F The only amendment to be made in the plaint was to add a relief for possession necessitated because of the provisions of section 22 , which is only an enabling provision. ", "There has been a protracted litigation and it has dragged on practically for about 13 years and it will be really a travesty of justice to ask the decree-holders to file a separate suit for possession The objection of the petitioner is hyper-technical. The execution court has every jurisdiction to allow the amendment. The only difficulty is that instead of granting a relief of possession should have allowed an amendment in the Plaint. The mere omission of to allow an amendment in the plaint is not so fatal as to deprive the decree-holders of the benefits of the decree when section 55 of the Transfer of property Act authorises the transferee to get possession in pursuance of a sale deed. ", "As pointed out in the earlier part of the judgment, the petitioner had started construction and, therefore, the decree-holders sought to injunct him from making construction on the disputed land but they were lulled by undertaking given by the petitioner that he would demolish the construction and restore the land to its original position in case the suit for specific performance was decreed. The undertaking given no doubt is a clever undertaking, but that might have given an impression to the plaintiff decree holders that in the event of success of the suit the construction would be demolished and they would get back possession. Now the judgment-debtor petitioner seeks to lake advantage of the expression used in the undertaking to contend that he had undertaken only to demolish the construction and restore the land to its original position. The contention now raised is that the petitioner never gave an undertaking to restore back-possession of the disputed property to the decree-holders. Indeed, Mr. stated before the that he was prepared to get the construction demolished but then stops short and says that possession could not be delivered to the decree holders unless there was an amendment in the plaint. We are not prepared to take such a narrow view of section 22 . It was open to the to allow an amendment and the on the basis of that section has allowed delivery of possession in pursuance of the decree passed in the case. ", "Before closing discussion on this point we cannot lose sight of section 28 of the Specific Relief Act, 1963, which reads: ", "\"28. (1) Where in any suit a decree for specific performance of a contract for the sale or lease of immovable property has been made and the purchaser or lease does not, within the period allowed by the decree or such further period as The may allow, pay the purchase-money or other sum which the has ordered him to pay, the vendor or lessor may apply in the same suit in which the . decree is made, to have the contract rescinded and on such application the may, by order, rescind the contract either so far as regards the party in default or altogether, as the justice of the case may require. (2) Where a contract is rescinded under sub- section (1) the - ", "(a) shall direct the purchaser or the lessee, if he has obtained possession of the property under the contract, to restore such possession to the vendor lessor. and ", "(b) may direct payment to the vendor or lessor of all the rents and profits which have accrued in respect of the property from the date on which the possession was so obtained by the purchaser or lessee until restoration of possession to the vendor or lessor, and; if the justice of the cases so requires, the refund of any sum paid by the vendee or lessee as earnest money or deposit in connection with the contract. ", "(3) If the purchaser or lessee pays the purchase money or other sum which he is ordered to pay under the decree within the period referred to in sub-section (1), the may, on application made in the same suit, award the purchaser or lessee such further relief as he may be entitled to, including in appropriate cases all or any of the following reliefs, namely: ", "(a) the execution of a proper conveyance or lease by the vendor or lessor; ", "(b) the delivery of possession, or partition, and separate possession, of the property on the execution of such conveyance or lease. (4) No separate suit in respect of any relief which may be claimed under this section shall lie at the instance of a vendor, purchaser, lessor or lessee, as the case may be \" ", "Sub-section (3) of section 28 clearly contemplates that if the purchaser or lessee pays the purchase money or other sum which he is ordered to pay under the decree, the may on application made in the same suit, award the purchaser or lessee such further relief as he may. be entitled to. Sub-clause (b) of sub-section (3) of section 28 contemplates the delivery of possession or partition and separate possession of the property on the execution of such conveyance or lease. Sub-section (4) of section 28 bars the filing of a separate suit for any relief which may be claimed under this section. ", " . dealing with section 28 (1) of the Specific Relief Act , 1963 this Court observed: ", "\" The Specific Relief Act , 1963, is not an exhaustive enactment and under the law relating to specific relief a which passes a decree for specific performance retains control over the decree even after the decree had been passed. Therefore, the , in the present case, retained control over the matter despite the decree and it was open to the , when it was alleged that the party moved against had positively refused to complete the contract, to entertain the application and order rescission of the decree if the allegation was proved.\" ", "The reasoning given by this Court with regard to the applicability of sub-section (1) of section 28 will equally apply to the applicapability of sub-section (3) of section ", "28. This is an additional reason why this Court should not interfere with the eminently just order of . had amended the decree passed by the first appellate court and passed a decree for possession not only against the transferors but also against their transferee, that is, the petitioner. ", "Procedure is meant to advance the cause of justice and not to retard it. The difficulty of the decree-holder starts in getting possession in pursuance of the decree obtained by him. The judgment-debtor tries to thwart the execution by all possible objections. In the circumstances narrated above, we do not find any fault with the order passed by . ", "For the reasons given above the petition for special leave to appeal must fail and it was accordingly dismissed. S.R. Petition dismissed. ", "114"], "relevant_candidates": ["0000006567", "0000232241", "0000247666", "0000293503", "0000330000", "0000359239", "0000399161", "0000437445", "0000702820", "0000752687", "0001349793", "0001601859", "0001728108"]} {"id": "0000491331", "text": [", J. ", "1. This is a petition under Article 226 of the Constitution impugning the legality of an order passed by , Varanasi, dated 10-11-1955, reducing the petitioner in rank for a period of two years, and also of an order of the Deputy Inspector General of Police, Eastern Range, Varanasi dated 26-6-1956 dismissing the petitioners' appeal against the aforesaid order of reduction, and of the order of the Inspector General of Police, Uttar Pradesh dated 20-3-1957, rejecting the petitioners' revision petition. ", "2. The facts, as stated in the petitioners' affidavit are these : He was enlisted in the force in 1931 and claims to have a good record of meritorious service (this claim is not denied by the ). On 15-8-3955, the petitioner was posted as Station Officer-in-charge of the Police Station at Moghalsarai in the district of Varanasi. Just before that time a firing had taken place in the of Bihar, as a result of which several students had died. This led to agitation among the students in Uttar Pradesh as well and demonstration took place on 15th August. ", "A large crowd of students and others collected at Moghalsarai in the morning and went round the town shouting slogans. At or about 9.30 A.M. a procession consisting of nearly 3,000 persons, mostly students, marched to the Police Station Moghalsarai and began to shout slogans. They wanted that the national flag hoisted on the building should be half-masted out of respect for the memory of students who were killed in the firing at Patna. The crowd stated that if this demand was not granted it should be fired. The petitioner, who was incharge of the Police station, had already telephoned to the Senior Superintendent of Police, Varanasi, and requested him to send re-enforcements to enable him to deal with the situation. ", "This was done by him before the arrival of the procession. But no re-enforcements turned up and the crowd reached the station and made the aforesaid demand for the half-masting of the national flag. The petitioner states that he again telephoned to the Senior Superintendent of informing him of the demand made by the students. He told him that the situation was critical and requested him to send police aid immediately, as the force available at the station was wholly inadequate to deal with the crowd. The petitioner further states that the Senior Superintendent of directed him on the telephone \"to handle the situation, tactfully\" (this allegation is admitted by the ). ", "3. All this caused delay which made the crowd restless, insistent and increasingly aggressive. The reinforcement did not arrive. The petitioner states that, in these circumstances, there were only 'two alternatives open to him either to ask the processionist to disperse, and on their refusal, to use force and resort to firing if necessary, for to avoid blood-shed by acceding to the request for the half-masting of the national flag. It is alleged by the petitioner that the crowd assured him that they did not mean any disrespect for the national flag which, they considered to be their own flag, but they only wanted it to be half-masted in memory of the students who had died as a result of the police firing at Patna. ", "In these circumstances, the petitioner, having failed to persuade the mob to disperse, realised that its attitude made it clear that any formal order to disperse would be resisted. He also realised that the force at his disposal was wholly inadequate to meet the situation, and that the station building was so constructed as to preclude any defensive resistance against a defiant mob of such a big size. In these circumstances, the petitioner used his own discretion and decided, in the best interest and prestige of the , to avoid blood-shed and destruction of property by conceding the crowd's demand for half-masting the national flag. He, therefore, directed the flag to be lowered by one root for a few minutes. During this interval the crowd approached the flag and observed silence for a few minutes in memory of the students, who had died in the Patna firing. After this, they saluted the national flag and departed. The flag was then hoisted at full-mast once again. ", "4. The petitioner claims that his decision not only saved the lives of a large number of citizens but also the honour of the national flag and the prestige of the Government. It also saved Government property (presumably he means that the mob would have resorted to arson and destruction of property if it had got out of control). The petitioner states that, some time after this incident on the same date, the Commissioner of Varanasi, the Senior Superintendent of Police, the Deputy Inspector General of Police and the District Magistrate came to Moghalsarai. The petitioner related to them the happenings earlier in the day and they expressed their full satisfaction \"in the manner in which the (petitioner) had handled the situation\" (This statement has not been controverted by the state). The petitioner also sent a written report to the Senior Superintendent of Police on the same day and also to his other immediate Officers. ", "5. The petitioner states that, suddenly, on 22-8-1955, he received an order from the Senior Superintendent of Police suspending him. He alleges that no enquiry of any sort, as required by para 486(111) of the Police Regulations, was made to test the veracity of the report made against him. A charge-sheet dated 26-8-1955 was served on the petitioner under sec. 7 of the Police Act . It did not contain the names of the witnesses to be examined by the prosecution nor a list of documents which would be relied upon by them. On 10-9-1955, the petitioner was informed that the proceedings were about to begin and that he would have to cross-examine the prosecution witnesses. ", "This intimation was given to him only a few hours before the commencement of the proceedings. He moved an application that he should be given the names of the witnesses so that he was in a position to cross-examine them properly, but his application was rejected by the Additional Superintendent of Police, conducting the departmental enquiry against (him, The examination of the prosecution and the defence witnesses was completed, and the Superintendent of Police gave his verdict on 20-10-1955. A copy of his finding has been attached as Annexure 'E' to the petitioner's affidavit. It contains the following conclusion: ", "\"I am to feel that the party charged was not led to his present lapse by any cowardice or deliberate desire to save himself at the cost of the national honour represented by the national flag but that the situation arose from his lack of Kill understanding of the implications of his action and his preliminary negligence in not keeping himself abreast of the situation. Under the circumstances \"therefore, while I am of the opinion that he does not deserve the severest punishment of dismissal, I do not consider him absolved of the initial negligence leading to the situation which necessitated his exercise of discretion and the consequent permitting of the lowering of the flag without use of power vested in him under Section 128 Cr. P. C. facts of which are not denied by the defence. In view of the overall situation and the existence of extenuating circumstances and a good Character Roll, I am inclined to deal with the party charged leniently. It is proposed to reduce him to the lowest grade for a period of two years. The party charged will appear before me on 1-11-1955, at the Police Office at 11 A.M. and show cause why this punishment should not be inflicted\". ", "6. The petitioner states that he submitted a written explanation in response to the show-cause notice in which he brought to the notice of the punishing authority a number of instances in which, under similar circumstances, other authorities had acted in the same manner as the petitioner. He pointed out that the Governor of Bihar had permitted the lowering of the national flag in circumstances similar to the case of the petitioner, with this difference that the Police force at the disposal of the Governor was sufficient to enable him to order the dispersal by force of the mob confronting him, whereas the petitioner had no adequate force to meet the situation. ", "His explanation was rejected and the Additional Superintendent of Police passed an order that the petitioner should be reduced to the lowest grade of pay in his rank for a period of two years. A copy of this order has been attached to the petitioner's affidavit as Annexure 'H'. The petitioner then filed an appeal before the Deputy Inspector General of Police, Eastern Range, which was dismissed. A copy of the appellate order has been filed as Annexure to the petitioners affidavit. He filed a revision before the Inspector General of Police Uttar Pradesh at Lucknow, which was also rejected. A copy of the order in revision has been attached as Annexure 'K' to the petitioner's affidavit. Aggrieved by the order of reduction the petitioner has come to this court for relief under Article 226 of the Constitution. ", "7. The petition is opposed by the State. A counter affidavit has been filed which was sworn by one , described as Circle Inspector of Police, Varanasi. It consists of 9 paragraphs of which the first two have been verified as true to the personal knowledge of the deponent and the remaining paragraphs \"as based on information and perusal of the record of this case.\" The first paragraph merely contains the formal statement that the deponent is the Circle Inspector of Police, posted at Varanasi and fully acquainted with the facts given in the affidavit. ", "The second paragraph asserts that the petitioner , was found guilty of permitting the lowering of the national flag without making use of the powers under Section 128 Cr. P. C. and that the charge was fully enquired into by the departmental authorities and it had been held to have been established. It also contains a submission of law that there is no error apparent on the face of the record. The allegations in these two paragraphs are more or less innocuous. All the remaining paragraph contain allegations based on hearsay information. Some of them merely contained the personal information of the official making the affidavit; for example, paragraph 4 of the counter affidavit runs as follows : ", "\"4 That in paras 13, 17 and 18 of the applicants' affidavit it is to state that the lowering or half-hoisting of the national flag in the circumstances of the case was a gross disrespect to it. The question of the assurance the processionist gave to the applicant is immaterial. The applicant has dishonoured the national flag.\" ", "8. It has been pointed out again and again by, this Court that the allegations in an affidavit in proceedings under Article 226 must be confined to statements based on the personal knowledge of the person swearing it, and must not contain any expression; of opinion or submissions of law. These warnings had been repeated a large number of times but the habit of including irrelevant and even improper allegations continues. I regret to say that affidavits filed on behalf of the very often include all the undesirable features frequently condemned by this Court. ", "The counter affidavit of in these proceedings is a fair specimen of what ought not to be. As the allegations made in it are inadmissible under the law, I reject the counter affidavit as an affidavit but direct that it shall remain on the record as the written statement of the in reply to the petition. Consequently the allegations contained in the petitioner's affidavit shall be deemed to have been uncontroverted. ", "9. Learned counsel for the petitioner, Mr. , impugned the legality of the decision to reduce the petition on seven grounds. First, he contended that no preliminary enquiry, as contemplated by Regulation 486(3) of the Police Regulations, was made and therefore the entire proceedings before the Enquiry Officer (Addl. Superintendent of Police) were without jurisdiction and illegal. Secondly, the petitioner had been convicted for an offence different from the one shown in the original charge. ", "Thirdly, the refusal of the Senior Superintendent of Police to summon the confidential reports of the Senior Superintendent of Police and the District Magistrate of Varanasi, which were sent by those Officers to Government immediately after the incident and in which the petitioner's action had been approved, had gravely prejudiced the petitioner in the enquiry. Fourthly, the refusal of the prosecution to supply the names of the prosecution witnesses to the petitioner had materially prejudiced the petitioner in his cross-examination. Fifthly, the commencement of the enquiry proceedings within two hours of the information to the petitioner that he would have to cross-examine the witnesses (no list) having been given) had gravely prejudiced the petitioner, as the interval at his disposal was too short to enable him to cross-examine the prosecution witnesses effectively. Sixthly, the record shows on the face of it that the petitioner committed no offence under the Police Act . ", "10. Before I deal with the arguments of the learned counsel for the petitioner on merits, it is necessary to clarify the position as regards facts. The material facts; are not in dispute, except as regards one or two points. The following material facts are either admitted by both parties or alleged by the petitioner and not disputed by the : ", "(1) The petitioner was in-charge of the Police Station at Moghalsarai on 16-8-1955, (2), A few days earlier, several students had been killed as a result of police firing at Patna in the State of Bihar. ", "(3) The Patna firing had resulted in agitation among the students. ", "(4) On 15-8-1955, a large crowd of students collected before the Police Station Moghalsarai, which was under the charge of the petitioner. ", "(5) The crowd consisted of about 3,000 persons, mostly students. ", "(6) The crowd demanded that the national flag be half-masted to show respect for the memory of the students who were killed in the Patna firing, and made it clear that officer-in-charge would have to concede the demand or disperse; the students by firing. ", "(7) The petitioner sent more than one telephone message to the Senior Superintendent of Police are Varanasi informing him of the situation and making urgent requests for additional force to enable him to cope with the situation. ", "(8) Senior Superintendent of Police, in reply, directed the petitioner to handle the situation tactfully. To quote his exact words, ''I told the Sub-Inspector that the flag should not be lowered and that he should handle the situation tactfully and should try to keep the students at bay till Officers and force reach from Banaras ...... I told the Station Officer to handle the situation tactfully but I never told him that no force should be used as mentioned in Ext. P. 6.\" ", "This is one of the most important facts in this case. ", "9. The Police enforcements demanded by the petitioner did not arrive in time and consequently he had to deal with the situation as best as he could, subject to the directions given by the Senior Superintendent of Police on the telephone. ", "10. The petitioner had two alternatives either to handle the situation tactfully without the use of the force or to direct the crowd under Section 128 Cr. P. C. to disperse and to resort to force in case of refusal. ", "11. The petitioner, in the exercise of his discretion, and in accordance with the direction of the Senior Superintendent of Police to handle the situation tactfully, acceded to the request of the crowd for half-masting the national flag. ", "12. The flag was half-masted by one foot. The crowd observed a few minutes silence and afterwards saluted the national flag and went away. ", "13. After this the flag was again flown at full-mast. ", "11. In addition to the above facts, learned Standing counsel for the State made a statement at the Bar, on a question from me, I pointed out to him that the District Magistrate of Varanasi had given evidence in the enquiry proceedings against the petitioner in which he stated that he received a report of the incident of 15th August at Moghalsarai from the Senior Superintendent of Police, which he forwarded to Government with his comments. I asked! him whether he was prepared to make a statement confirming or denying the allegation in the petitioner's affidavit that the district authorities as well as the Commissioner of Varanasi and the Deputy Inspector General of Police had expressed their full satisfaction with the manner in which the petitioner had handled the situation at the Police station on 15-8-1955. ", "In response to my suggestion, the learned Standing counsel, after obtaining an adjournment to obtain Instructions, stated that all the senior officers of the district, that is, the Commissioner, the Deputy Inspector General of Police, the District Magistrate and the Senior Superintendent of Police, had visited Moghalsarai soon after the incident and had agreed that the petitioner had a very difficult situation to face and handled the situation as best as be could at the spur of the moment without worsening it. I was shown a letter written by the Senior Superintendent of Police, , on 28-5-1956, and addressed to the Deputy Inspector General of Police, (e), which contained a statement almost identical with the one made by learned counsel for the 'State at the bar. This is letter No. S/SSP/R-14 dated 28-5-1956. ", "12. It is also important to bear in mind the exact terms of the charge which the petitioner was asked to defend himself against. It is as follows ; ", "\" is charged under Section 7 of the Police Act for remissness in the discharge of his duties and unfitness for the same, in that, while posted as Station Officer, Moghalsarai, on 15-8-1955, he, without making use of the powers vested in him under Section 128 of the Cr. P. C. permitted the lowering of the national flag at the Police Station Moghal Barai some time between 8.30 A.M. and 11 A.M. when a mob of agitators, forming an unlawful assembly, demanded the lowering thereof in sympathy with the students killed at Patna in a police firing earlier. ", "II- 'S. I. Shri will appear before me on Monday, 5-9-1955 and put in his written statement as to whether he accepts or; denies the charge. ", "Sd./- R. N. Shivapory I. P. C. ", "Additional Supdt. of Police, Banaras. ", "26-8-55.\" ", "13. It is noteworthy that the petitioner was accused of the offence of remissness in the discharge of his duties. He was also served with the particulars of the offence attributed to him. He was told that he had failed to make use of the powers vested in him under Section 128 Cr. P. C. when faced with the demand of a mob of agitators (forming an unlawful assembly) that the national flag flying over the police station should be lowered in sympathy with the students killed in a police firing at Patna. It is important to take note of those particulars, for if the record shows, on the face of it, that the petitioner was held to be guilty of some other offence or offences not included in these particulars, he will have established his case that he was not given a reasonable opportunity of showing cause against the action proposed to be taken against him as required under Article 311 of the Constitution. ", "14. I confess that I have given the most anxious consideration to this case which raises issues of public interest and far-reaching constitutional importance. Some of the facts loading to the petitioners' reduction are wrapped in mystery which was not cleared up during the hearing of this case. There is not the slightest doubt that his action in dealing with a very difficult situation was at first approved by all his superior officers without a single exception. But all of a sudden, for some reason not revealed in the record, it was decided to censure the petitioner for having acquiesced in the half-masting of the national flag, and he was formally charged with the offence for not having dispersed the crowd by force. ", "Learned counsel for the petitioner suggested, during his arguments, that the change in the attitude of the authorities was due to a speech made by the Prime Minister, shortly after the incident in which he had observed that no insult to the national flag should be tolerated, In fact, counsel opened his argument with the remark that \"this was a very unfortunate case, in which the whole trouble was caused by a speech of the Prime Minister after a few incidents in which the students had demanded that the national flag should be lowered in the memory of students who were killed in the Patna firing and on the refusal of the authorities to do so, had haulted down and burnt the flag.\" Learned counsel said that, after the speech, the petitioner was made a scapegoat by the authorities to please the Prime Minister. ", "15. If properly proved, this allegation would be yet another proof that human nature (particularly official nature) has not changed very much since the day when (29th December 1175 A.D.) the four English knights-, , , and rode out to Canterbury to carry out what) they considered to be the pleasure of their royal master \" to be rid of the turbulent priest.\" ", "and murder , Archbishop of bury in his own Cathedral. But no foundation has been laid for this suggestion in the petitioner's affidavit. There is not even a mention of the Prime Minister's speech to which learned counsel referred in his very first sentence of his opening argument. ", "Such a foundation could have been laid.; ", "It was not necessary for the petitioner to make any accusations or insinuations. It would have been sufficient to 'give the date of the speech alleged to have been made by the Prime Minister and a summary of its contents as reported in the press. If the petitioner could have shown that his immediate superiors had approved of his action before the alleged speech and that the sudden change in their attitude took place after it, the sequence of events would have been, in the absence of any alternative explanation from the , more eloquent than any argument of counsel. The petitioner might then have been in a position to suggest that the authorities had surrendered their independent judgment and had exercised their powers under Section 7 of the Police Act in accordance with what they considered the sentiments of the Prime Minister. But, as no foundation of fact was laid in the petitioner's affidavit, learned counsel's suggestion is no more than an insinuation. I am afraid it is; not possible for this Court to take notice of alleged events which are not proved by the record, ", "16. But I cannot help noticing that the sudden reversal of the attitude of the authorities, from unqualified approval of the petitioner's action to its downright condemnation is wrapped in mystery. For example, on 28-5-1958, the Deputy Inspector General of Police, Mr. visited Moghalsarai and appears to have concurred with the view of the Senior Superintendent of Police Mr. that the petitioner had a very difficult situation to face and handled it as best as he could at the spur of the moment without worsening it. But the same officer on June 27, 1956, in his order dismissing the petitioner's appeal observed, \"I agree with the finding of the Additional Superintendent of Police that the appellant was negligent in dealing with the situation and that he was weak for handling the mob\". ", "17. But, this Court cannot interfere with the decision of the executive authorities on any consideration of alleged injustice as such interference would amount to a usurpation by this Court of powers which the Constitution has vested exclusively with the executive branch of Government. can issue an order, in the exercise of its powers under Article 226 of the Constitution, only in accordance with well recognised principles. An order removing an official of the State can be quashed by this Court only if it was passed without jurisdiction or in excess of Jurisdiction or without complying with the conditions laid down in Article 311 of the Constitution, or if there is any other illegality or irregularity which vitiates the decision. ", "If, however the order was within jurisdiction and not otherwise illegal, it cannot be set aside by this on the ground, that in its opinion, it is harsh or unjust or oppressive. The function of is to ensure that no illegality is committed by the authorities in the exercise of their powers conferred by law. Beyond this limited function, the cannot interfere with the decisions of the executive and, in particular, it cannot presume to be wiser than the executive in matters exclusively within the sphere of the latter and substitute its own Judgment for that of the executive. ", "18. I shall now consider whether the procedure leading to the decision to reduce the petitioner: In rank violates any provision of the law or Constitution to such an extent as to justify the intervention of this Court, Learned counsel for the petitioner has advanced a number of reasons against the legality of the order. But the starting point of any discussion of this controversy must be the fundamental fact that the petitioner is a member of a service of tbe State of Uttar Pradesh. His tenure of office is therefore governed by Article 310 of the Constitution; he holds office during the pleasure of the Governor. ", "This rule is subject to the limitations laid down In Article 311 of the Constitution. One of them is that a civil servant shall not be dismissed or removed by an authority subordinate to that by which he was appointed. The other is that he shall not be dismissed or removed or reduced in rank until he has been given a reasonable opportunity of showing cause against the action proposed to be taken in regard to him (in certain cases this procedure may be dispensed with but that point does not arise in the facts of this case). ", "These are the only two fetters on the power of the Governor to terminate at his pleasure the services of any civil servant in the employment of the . There are a few other limitations expressly provided by the Constitution in the case of specified classes of employees. They are mentioned, inter alia, in Arts. 124. 148. 218 and 324 which respectively provide expressly that the Judges the Auditor General, the Judges and the Chief Election. Commissioner shall not be removed from his office except by an order of the President passed after an address by each or supported by the requisite majority (specified in the particular Article applicable), has been presented to him in the same session for such removal on the ground of proved misbehavour or incapacity. ", "Another exception, is provided by Art 317 in the cases of the Chairmen and Members of the and ' : it lays) down that such Chairman or Member shall only be removed from his office by order of the President on the ground of misbehavior after , on reference made to it by the President, has, on enquiry held in accordance with the procedure prescribed in that behalf in Article 145 , reported that the Chairman or such other Members, as the case may be, ought on any such ground to be removed. Subject to these express exceptions, the Constitution of India by Article 310(1 ), has adopted the English Common Law Rule contained in the Lathi phrase durante bene placito' and laid down that public servants hold office during the pleasure of the President or Governor, as the case may be, subject to the limitations imposed by Article 311. ", "As observed by in AIR 1958 SC 36, Article 311: operates as a proviso to Article 310(1). Subject to the limitations contained in it the power of tbe Governor to dispense with the services of a civil servant is absolute. It was observed by of this Court ( and , JJ) in . AIR 1954 All 629 at p. 632.\" ", "The Governor's power to dismiss at pleasure is subject only to the express provisions of the Constitution. Power is conferred upon the Governor by Article 309 to make rule regulating the conditions of service of civil servants of , but such power is subject, 'inter alia', to the provisions of Article 310 , and no rules can be made winch fetter or restrict his power to dismiss at pleasure. We find ourselves in agreement, if we may say so with respect, with the views of , on this point in 'Mrs. ,' AIR 1952 Madh B 105. The disciplinary Rules were made prior to the commencement of the Constitution, and assuming they were validly made they can, in our opinion, have no greater effect or stand on a higher rooting than rules made by the Governor under Article 309. These rules (except Rule 10(1) 1 are in our opinion administrative rules, and the contravention of their provisions will not confer upon the petitioner a cause of action.\" ", "19. In the case quoted with approval by the learned Judges (AIR 1952 Madh B. 105) it was held that any rules made by the Governor in the exercise of his powers under Article 309 of the Constitution do not in any way abridge or control the powers of the President or the Governor to dismiss at pleasure a civil servant. It was further held that these rules are merely administrative rules for the guidance of officers of the Government in the, imposition of penalties and in the conduct of departmental enquiries against Government servants. The dismissal, removal, or reduction in rank of a civil servant in violation of the rules would not by itself entitle him to come to (under Article 226 of the Constitution). ", "It was further made clear that only a breach of Article 311 would give to a civil servant the right to approach or a civil court for redress. In other words, it was held that no breach of any rule would invalidate the decision till removed or reduced in rank a civil servant unless such breach amounts to violation of the conditions presecribed in Article 311 of the Constitution. The same principle was laid down by in , AIR 1937 PC 31 in which the meaning of the phrase, \"shall hold office during the pleasure of the \" was explained. ", "It was laid down that no redress was obtainable from the courts by action if a civil servant was removed without complying with the procedure prescribed in the rules made under the Government of India Act. It is noteworthy that were dealing with a case in which, to quote their own words, there had been \"a serious and complete; failure to adhere to important and indeed fundamental rules\" and in which \"mistake of a serious kind had been made and wrongs had been done which called for redress\". But the aggrieved employee's suit was dismissed an the ground that the power of the to dismiss a civil servant at its pleasure had been made absolute under the Constitution and could brook no limitation. ", "It is settled law that under our Constitution, excepting cases expressly reserved by the Constitution and also those where the employee's tenure is fixed by a special contract, a servant of the state cannot impugn the legality of an order of dismissal or removal or reduction unless he can show that it was passed in violation of the conditions prescribed by Article 311 of the Constitution. If, in answer to any action by the employee, the can show that these conditions were complied with, the will uphold the dismissal or removal or reduction in rank and no breach of rules, however gross or blatant, will avail the aggrieved employee. The principle underlying this harsh rule is that, in their wisdom, the makers of our Constitution gave an absolute power to the President or the Governor (as the case may be) to dismiss or remove or reduce in rank any employee at his pleasure. ", "They thought that it was in the public interest that the should not be answerable in the courts of law if it took action against its employees except to a limited extent and that it should have a whip hand over its servants in this respect. The Governor wields a power conferred by the fundamental law of the land and it cannot be abridged by any act of the or rule made under any statute. It can, be abridged or taken away only by an amendment of the Constitution itself. ", "20. Another, limitation is imposed by Part III of the Constitution. In the recent case of v. , Writ Petn. No. 3660 of 1956, I pointed out that the view expressed by , J. in ., AIR 1954 All 343 that Article 810 being a special provision is not controlled by Article 14 is in conflict with that of in AIR 1954 SC 493. ", "I held in that case that Article 310 is not a special provision within the area of Part III of the Constitution, that the orbits of Article 310 and Part III are different, and that the injunctions against discrimination in Arts. 14, 15 and 16 transcend and control every power under the Constitution and that there are no exemptions except those specified in the Constitution itself. I further held that the power of the under Article 310 is not exempt from the control of these three Articles and that a Government servant is entitled to relief against victimisation for motives of religious bigotry racialism, casteism, provincialism or on the ground of sex. However, these considerations do not arise in the present case. ", "21. The petitioner is a member of the Police force a fact of vital significance in this case. The action against him was not taken by the Governor or any authority acting on his behalf under the authority vested in him under Article 310. (This casa does not appear to have reached the Governor officially). The petitioner being a Police officer of subordinate rank, the disciplinary proceedings resulting an, his reduction were initiated under Section 7 of the Police Act (Act V of 1861). That Act was passed in 1861 and amended by the Police Act (Amendment: Act VIII of 1895). It is effective today. Section 7 of this Act is as follows: ", "\"7. (Subject to such rules as the Provincial Government may from time to time make under this Act, the Inspector-General, Deputy Inspectors-General, Assistant Inspectors-General and District Superintendents of Police may at any time dismiss, suspend or reduce any police-officer of the subordinate ranks whom they shall think 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 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 month's pay; ", "(b) confinement to quarters for a term not exceeding fifteen days, with or without punishment drill, extra guard, fatigue or other duty; ", "(c) deprivation of good-conduct pay; (d) removal from any office of distinction or special emolument)\". ", "22. This section invests the three authorities Specified thereunder with certain disciplinary powers against police officials of subordinate rank. They are, or course subject to the limitations specified in the Section. First, they are subject to the rules, if any made by . The rules in this case are the Police Regulations. Secondly, the punishment can be inflicted under this section only for remissness or negligence in the discharge of duty or unfitness for the same. Thirdly, there must be a finding by the punishing officer that the subordinate has discharged his duty in a careless or negligent manner or has, by any act, of his own, rendered himself unfit for the discharge of his duty. Fourthly, the punishment must be confined to the categories specified in the Section. By the U. P. Act of 1944, a new category of punishment was added \"withholding of increments or promotions including stoppage at an efficiency bar.\" ", "23. These powers, under Section 7 , are derived from a statute which existed prior to the Constitution which now invests the with absolute control over the tenure of service of every State servant. The question is whether, after the commencement of the Constitution, the powers vested under Section 7 in the Superintendent, Deputy Inspector-General, and inspector-General of Police, have been superseded by Article 310 or have merged in the powers of the Governor. If they have, it follows that, after the Constitution, these authorities shall be deemed to exercise this power on behalf the Governor. ", "The point is of importance, for if the powers under the Police Act have, after the Constitution merged in the powers of the Governor and are exercised by the three authorities on his behalf. Article 310 will apply; and the authority of this Article will be a good defence against any attack on the legality of an order passed under that Article, unless it can be shown that the mandatory provisions of Article 311 had not beep, complied with and that the official concerned was not given a reasonable opportunity of showing cause against the action proposed to be taken in regard to him. But no breach of the Police Regulations or any other rules will avail a petitioner who seeks relief under Article 226 unless he can show that such breach has resulted in a violation of Article 311. ", "24. But if on the other hand, the' powers of the Superintendent, Deputy Inspector General and the Inspector General of Police under Section 7 are exercised, even after the commencement of the Constitution, independently of the Governor's powers under Article 310 , they must be subject, in addition to the transcendent control of Article 311 , to all the limitations and conditions in the statute creating these powers. It is, therefore, necessary to consider the effect of the Constitution (including Article 310 ) on the powers of the three authorities under Section 7 of the Police Act. ", "25. Article 310 deals with the tenure of office of servants and says in effect that every servant shall hold office during the pleasure of Government. This provision is borrowed from the British Constitution under which every servant of the holds office during Her Majesty's pleasure. If the wishes to remove or take action against any servant, it acts in its jurisdiction. ", "26. and , in their treatise, Constitutional Law, 5th Edition, have pointed out that the power of the in regard! to the civil service is a part of the prerogative powers of the that is, the executive powers of the . In India, too, the tenure of a Government service is at the pleasure of the President or the Governor but the actual action against any servant is taken under the executive powers of the . Now, under Article 53 , the executive power of the is vested in the President and may be exercised by him through officers subordinate to him. But Clause (2) of this Article clearly states that nothing in this article shall be deemed, to transfer to the President any functions conferred by any existing law on the Government of any or other authority. ", "There is an exactly similar proviso to Article 154 vesting the executive power of the State in the Governor which says that nothing in that Article shall be deemed to transfer to him functions conferred by existing law on any other authority. It, therefore, follows that the powers of the Superintendent, Deputy Inspector General and the Inspector General of police under Section 7 , having been conferred by a existing on the date of the Constitution, were nut transferred to the Governor but continued to be vested in those three officers. No question of supersession or merger of these powers arises. These authorities exercise their powers under Section 7 of the Police Act, not on behalf of the Governor but by virtue of the authority vested in them by statute. I am fortified in this opinion by the following observation of of this Court ( and , JJ.) in AIR 1954 All 629 : ", "\"Now Section 7 of the Police Act provides that (subject to Article 311 and to such rules as the State Government may make) certain specified officers may dismiss a police officer of the subordinate ranks. There is nothing in the Act which touches on the power of the to dismiss a police officer and nothing which is inconsistent therewith; on the other hand, Rule 479-A of the Police Regulations, which is a rule made under Section 7 of the Act, contains an express reservation of the Governor's powers of punishment with reference to all officers. The powers vested by Section 7 in the Inspector General and certain other Officers to dismiss subordinate ranks of the police Force is not, in our opinion, a delegation to them of the 's power of dismissal at all but is a separate statutory power which is neither a substitute for, nor restricts the constitutional power of the to dismiss its servant at its pleasure.\" ", "27. In that case their Lordships were considering the effect of Section 241 of the Government of India Act, 1935, on the powers under Section 7 of the Police Act. But Article 310(1) incorporates the principle contained in Section 241 that the tenure of office of every Government servant shall be at the pleasure of Government. Therefore the observation of and , JJ. in AIR 1954 All 629 is equally applicable to Article 310. I, therefore, hold that the power under Section 7 of the Police Act are not delegated by the Governor but created by statute and therefore subject to all the conditions and limitations prescribed by that statute. It follows that any serious violation of the conditions of transgression of the limitations will invalidate any decision made under Section 7 . ", "28. I shall now proceed to consider whether the proceedings which led to the order reducing the petitioner are vitiated by any irregularity or illegality which calls for the interference of this under Article 226. ", "29. Learned counsel for the petitioner contended that no preliminary enquiry, as prescribed by Regulation 486 (III) was made and therefore the entire subsequent proceedings before the enquiry officer were without jurisdiction. 486 (III) is as follows : ", "\"When a Superintendent of Police sees reason to take action on information given to him, or or his own knowledge or suspicion, that a police officer subordinate to him has committed an offence under Section 7 of the Police Act or a non-cognizable offence (including an offence under Section 29 of the Police Act) of which he considers it unnecessary at that stage to forward a report in writing to the District Magistrate under rule II above, he will1 make or cause to be made by an officer senior in rank to the officer charged, a departmental inquiry sufficient to test the truth of the charge. ", "On the conclusion of this inquiry he will decide whether further action is necessary, and, if so, whether the officer charged should be departmentally \"tried, or whether the District Magistrate should be moved to take cognizance of the case under the Criminal Procedure Code ; provided that before the District Magistrate is moved by the Superintendent o Police to proceed criminally with a case under Section 29 of the Police Act or other non-cognizable, section of the law against an inspector, sergeant or sub-inspector, the concurrence of the Deputy Inspector General must be obtained. Prosecutions under Section 29 should rarely be instituted and only when the offence cannot be adequately dealt with under Section 7 .\" ", "30. This clause provides in effect that there shall be a preliminary investigation before it is decided that a regular departmental enquiry shall be held against a official. The language of this clause shows that this investigation is a very informal affair. It can be very largely oral and even written statements need not be recorded verbatim. The) purpose of the investigation appears to be to enable the Superintendent to decide whether, on the material before him, any further action against the officer charged shall be worthwhile. It is not required that the accused officer shall be heard at this stage. The investigation should satisfy the Superintendent that there is prima facie a case against the Officer. ", "But where the facts are not open to dispute, the omission to hold a preliminary' investigation will not invalidate the subsequent departmental enquiry. The mission to make a preliminary investigation will 'not be fatal to the subsequent proceedings if no prejudice has been caused to the accused official by the omission. The preliminary enquiry under Clause III is not in the interest of the accused officer hut for the satisfaction of the Superintendent of Police, If, without holding an enquiry, he is satisfied that proceedings should be taken against the officer, the omission to comply with the provisions of Clause III will not invalidate the departmental proceedings, unless the officer can show that he has been materially prejudiced by this omission in the subsequent departmental enquiry. ", "In the counter affidavit of the ' (rejected by me as an affidavit but retained on the record as a written statement), it is admitted that no enquiry under Clause III was held but it is explained that, as it was considered by the departmental authorities that proceedings under Section 7 should be taken against the petitioner, a preliminary enquiry was not considered necessary. Learned counsel was not able to explain how the petitioner has been prejudiced by the omission to hold the investigation. I hold that the omission to make a preliminary enquiry under Section 486(III) does not invalidate the subsequent proceedings. ", "31. Next it was contended that the refusal of the Senior Superintendent of Police to summon the confidential reports which were sent by the local authorities to Government immediately after the incident and in which the petitioner's action had been approved, had gravely prejudiced the petitioner in, 'the enquiry. The record shows that both the District Magistrate and the Superintendent of Police were summoned as witnesses in the departmental enquiry and cross-examined by the petitioner. The petitioner could have put any question to both of these officers to elicit the fact that they had sent their reports and if so, to prove their contents. But no such question appears to have been asked. ", "The petitioner had a fair opportunity of proving all the facts favourable to his case and cannot make a grievance of his own failure to avail of this opportunity. Moreover, during the hearing of this petition, counsel for the State conceded that the petitioner's action had been approved by the Superintendent, the District Magistrate, and the Commissioner of Varanasi, and the Deputy Inspector. General of Police. The Superintendent's letter No. ST/. SSP/R-14 dated Banaras May 18, 1956 was read out in Court. Counsel for the petitioner was not able to show that the initial approval of the petitioner's action by these local authorities does not advance the petitioner's case in law, though it may excite sympathy for the petitioner. There is no substance in this contention. ", "32. It was then contended by learned counsel that the refusal of the prosecution to supply the names of the prosecution witnesses to the petitioner had materially prejudiced him in his cross-examination. It was also contended that adequate notice, of the commencement of the enquiry proceedings was not given to him and he was asked to take part in the enquiry within two hours of the information given to him. These two contentions can be disposed of together. I would have been disposed to take this grievance seriously if there had been any dispute regarding facts. But in the present case all the material facts are undisputed. In an earlier part of this judgment I have enumerated 13 sets of material facts which are common ground between the petitioner and his accusers. ", "The entire controversy centres round the question whether his action in not resorting to firing amounts to negligence or failure to discharge his duty within the meaning of Section 7 of the Police Act. This question can be decided on the basis of admitted or uncontroverted facts, and it is difficult to understand what further material would have been added to the evidence if the petitioner had been given a longer notice of the proceedings. Learned counsel' for the petitioner was not able to show, in spite of repeated questions from me, how the petitioner was, materially prejudiced by the alleged short notice or what material facts would have been elicited by him in cross-examination if he had been given more time I, therefore, hold that no prejudice was caused to the petitioner by the alleged shortage of notice, ", "33. It was then contended by the learned counsel that the petitioner had been convicted for an offence different from the one shown in the original charge. The charge-sheet served on the petitioner under Section 7 has been quoted verbatim in an earlier portion of the judgment. It accuses the petitioner of having failed to make use of the power vested in him under Section 128 Cr. P. C. when he was asked by the crowd to lower the national flag at station Moghalsarai on 15-8-1955. The essence of the charge therefore is based on the petitioner's failure to use force against the so-called unlawful assembly which faced him at the station on 1.5th August. The verdict of the enquiry officer is contained in the concluding paragraph of his finding which is as follows : ", "\"Under the circumstances therefore I am of the opinion that he does not deserve the severest punishment of dismissal, I do not consider him absolved of the initial negligence leading to the situation which necessitated his exercise of discretion and the consequent permitting of the lowering of the flag without use of power vested in him under Section 128 of the Cr. P. C., facts of which are not denied by the defence.\" ", "33a. This paragraph shows that the enquiry officer convicted the petitioner of the offence of having permitted the lowering of the national flag without use of the power vested in him under Section 128 Cr. P. C. The paragraph also contains reasons which led the Enquiry officer to give this finding. It is true that he says that the petitioner by his own initial negligence created for himself a situation in which be was compelled to agree to the lowering of the flag without being able to use force under Section 128 Cr, P. C. But the petitioner has not been convicted of his alleged initial negligence. ", "The Enquiry officer observed, \"On a careful scrutiny of the evidence put up before me, I am, of the opinion that the party charged in spite of clear orders issued from was not keeping abreast of the developments in the students world of his political circle and did not consider legal action against students advisable at any stage.\" He then gave the finding quoted above which held him guilty of the offence stated in the charge. It may be that any consideration of some previous act of remissness of duty on 15-8-1956 may affect the; validity of the Enquiry Officer's finding. But I am unable to agree that the petitioner has been convicted of an offence different from the one he was charged with. Whether the conviction is legal is another matter, ", "34. I shall now consider the last contention of the petitioner that he was not guilty of any offence under the Police Act . In effect, the petitioner asks this court to hold that the finding of the enquiry officer that the petitioner was remiss in the discharge of his duties because he permitted the lowering of the national flag without making use of the powers vested in him under Section 128 Cr. P, C. is wrong'. On the other hand, it is ' contended on behalf of the , that this court has no jurisdiction to interfere with this finding in proceedings under Article 226 of the Constitution. ", "It is also contended that this is a finding of fact which cannot be interfered with in proceedings under Article 226. Junior 'Standing Counsel contended that, even if this Court is of the opinion that it would have given a different decision on the same set of facts, it cannot substitute its own opinion for that of the officer. The two opposing contentions raise a question of far-reaching importance relating to the power of under Article 226 of the Constitution to interfere with the findings of judicial or quasi-judicial tribunals on the ground that they are erroneous, ", "35. It is beyond dispute that the departmental enquiry under Section 7 of the Police Act read with Clause 489 of the Police Regulations is quasi-judicial in nature. A charge sheet has to be served on the accused officer. Evidence must be led on both sides, The testimony of witnesses must be direct and not hear-say. The entire evidence must be recorded by the Superintendent of Police himself in the presence of the party charged, who must be allowed to cross-examine the witnesses. On the basis of the material before him, the Superintendent of Police must give a finding. He is enjoined 'to confine himself strictly to the subject of the charge and to the evidence on the record and must discuss every relevant plea raised by the officer charged\". ", "Thus, this enquiry has all the characteristics of a quasi-judicial proceeding pointed out by in , AIR 1950 SC 222. In fact, the various provisions of the Police Regulations make the enquiry almost indistinguishable from a regular criminal trial. That being so, the proceedings are amenable to the jurisdiction of this court under Article 226 and, on sufficient cause being shown, a writ of certiorari can issue. ", "36. , AIR 1954 SC 440 held that certiorari will issue if the tribunal has acted without jurisdiction or in excess of it. It will also issue if the tribunal acts in flagrant disregard of the rules of procedure or where no particular procedure is prescribed, it violates the principles of natural justice. Certiorari will\" also issue if there is a manifest error on the face of the proceedings as for example, when it is based on clear ignorance or disregard of the provisions of the law. To quote the words of , \"It is a patent error which can be corrected by certiorari but not a mere wrong decision\". ", "In the present case no question of absence of excess of jurisdiction arises,, as it is common ground? that the Additional Superintendent of Police had' the power to conduct the departmental enquiry against the petitioner. I have already rejected the contentions of learned counsel for the petitioner that there has been any serious irregularity or illegality in procedure or failure to observe the principles of natural justice. The sole remaining question, therefore, is whether there is such a manifest error in the findings of the Enquiry officer as to justify the issue, of a writ of certiorari. ", "37. In the subsequent case of , AIR 1955 SC 233 at p, 244, considered what amounts to a manifest error. It observed; \"It may therefore be taken as settled that a writ of certiorari could be issued to correct an error of law. But it is essential that it should be something more than a mere error; it must be one which must be manifest on the face' of' the record. The real difficulty with reference to this matter, however, is not so much in the statement of the principle as in its application to the facts of a particular case. ", "When does an error cease to be a mere error and become an error apparent on the face of the re-cord? ..... The fact is that what is an error apparent on the face of the record cannot be defined precisely or, exhaustively there being! an element of indefiniteness inherent in its very nature, and it must be left to be determined judicially on the facts of each case,\" ", "In no subsequent case, have their Lordship given a more precise definition of \"an error apparent on the face of the record\", for the simple reason that they have already held in case (S) AIR 1955 SC 233 that this phrase \"cannot be defined precisely or exhaustively, there being an element of indefiniteness inherent in its very nature\". They left to to decide each case on its own facts, This court has adopted, as indeed it was bound so to do', the approach of to this question. , AIR 1956 All 603, 607, a Division Bench of this court observed: ", "\"It is clear that no exhaustive definition can be given to the words 'error apparent on the face of' the record.' It will not entirely depend upon the nature of the error or upon the degree of the error. Each case will have to be determined on its own facts. A superior court or tribunal will have to examine an order itself and decide whether the order, in the circumstances of that particular case, can be regarded as erroneous on the face of the record or a mere error of law.\" ", "38. From these authorities, it is clear that a, writ of certiorari will issue to correct an error of law' only if it is manifest or apparent on the face of the record. A writ will not issue if it is a mere error of law, and certainly not if the error relates to a finding of fact. I have therefore to consider whether, in the present case, the finding of the officer is erroneous and if so, whether this error is one of law and manifest on the face of the record. ", "39. The charge against the petitioner was that fee \"without making use of the powers vested in him under Section 128 of Cr. P. C., permitted the lowering of the national flag at the Police Station Moghalsarai some time between 8.30 A.M. and 11 A.M., when a mob of agitators, forming an unlawful assembly, demanded the lowering thereof in sympathy with the1 students killed at Patna in a police firing earlier\" and that this failure amounts to 'remissness in the discharge of his duties and unfitness for the same'. In his evidence before the enquiry officer, the Senior Superintendent of Police stated that he had directed the petitioner \"to handle the situation tactfully\". ", "His exact words are \"I told the Sub-Inspector that the flag should not be lowered and that he should, handle the situation tactfully and should try to keep students at bay till officers and force reached from Banaras ..... I told the Station Officer to handle the situation tactfully but I never told him that no force should be used as mentioned in Ext. P. 6\". From, this statement it is clear that the petitioner had received the command of a superior officer \"to handle the situation tactfully\", It is equally clear that if he had violated this command he would have been guilty of the offence of disobedience of orders. The controversy therefore resolves itself into a simple question : Can an officer who has been commanded \"to handle the situation tactfully\" be guilty of remissness in the discharge of his duties if he does not make use of the powers vested in him under Section 128 Cr. P. C. The word \"tact\" has been defined in as \"peculiar ability to deal with others without giving offence.\" ", "Is it open to an officer who has received such an order Jo make use of his powers under Section 128 Cr. P. C. when dealing with the crowd in regard to which he has received the order to handle it tactfully? I think any use of powers under Section 128 is dearly excluded. This is made clear by an examination of the provisions of this section. Section 128 occurs in Chapter IX of the Code which bears the title \"Unlawful Assemblies\". It consists of six sections 127 to 132A . Section 127 says that \"any Magistrate or officer in charge of a Police station may command an unlawful assembly .... to disperse\". Section 128 gives him the power to use force in case of refusal by such assembly to disperse. It is as follows : ", "\"128. Use of civil force to disperse, If, upon being so commanded, any such assembly does not disperse or if, without being so commanded it conducts itself in such manner as to show a determination not to disperse, any Magistrate or officer in charge of a police-station, whether within or without the Presidency towns, may proceed to disperse such assembly by force, and may require the assistance of any male person, not being an officer, soldier, sailor or airman in the armed forces, and acting as such for the purpose of dispersing such assembly, and, if necessary arresting and confining the persons who form part of it, in order to disperse such assembly Or that they may be punished according to law.\" ", "40. Section 129 deals with a situation when the force at the disposal of the officer concerned may not be sufficient to disperse an unlawful assembly facing him. It invests the Magistrate with the power to cause it to be dispersed by . Section 130 imposes a duty on any Officer commanding troops, when required by a Magistrate, to disperse such an assembly, to obey this requisition and to use as little force as may be consistent with dispersing the assembly. The same Section empowers the Magistrate to arrest persons forming part of the assembly. Section 131 deals with, a situation when public security is manifestly endangered by such an unlawful assembly but no Magistrate can be communicated with. In such an emergency any Commissioned Officer of may disperse such assembly with the help of under his command and may arrest and confine any person forming part of it. ", "Section 132 gives statutory protection to officers against prosecution for acts done under this Chapter. It is therefore clear that an officer who gives the order under Section 128 Cr. P. C. commanding an assembly to disperse must leave all considerations of tact behind him, ignore any express direction to handle the crowd tactfully and must be prepared to take all such further measures including the use of Armed Forces, if necessary, to ensure that his command is obeyed by the assembly or the mob. It is equally clear that an officer who is under orders to deal with an assembly tactfully cannot invoke the powers under Section 128 Cr. P. C. for the injunction to use tact contains the implied command not to use force. It is impossible to conceive of an order which simultaneously requires a official to use tact in dealing with a crowd and at the same time requires him to disperse it by force. ", "41. In his finding the enquiry officer has relied on the statement of Mr. , then Senior Superintendent of Police Banaras, who deposed before him \"I told the Station Officer to handle the situation tactfully but I never told him that no force should be used.\" But the enquiry officer did not pause to consider that the order to handle the situation tactfully contained an implied prohibition against the use of force. The enquiry officer has also relied on the following statement of the Senior Superintendent of Police : ", "\"I told the Sub-Inspector that the flag should not be lowered and that he should handle the situation tactfully and should try to keep the students at bay till officers and force reach from Banaras.\" The enquiry officer attached some importance to the direction of the senior Superintendent of Police that the national flag should not be lowered. He also appears to have been, considerably influenced by the fact that the national flag had been \"insulted\". observed: ", "\"The honour of the national flag is one of the primary and the most cherished values of the nation, and as such, permitting any insult to this, no matter what the stake on the other side cannot be considered to be a Justified and correct use of discretion.\" ", "42. This observation shows that the enquiry officer lost sight of the fact that he was not trying the petitioner for any alleged offence of permitting any insult to the flag but for the offence of remissness, in that he permitted the lowering of the flag without making use of the powers vested in him under Section 128 Cr. was not charged with any offence of commission but of omission that is, failure to use force. The language of the charge makes this clear, for the words arc \"remissness in the discharge of his duties\". Remissness means, according to the Websters' Dictionary, the offence of \"showing neglect or inattention\". ", "Now, the lowering of the national flag was a positive act in the performance of which no question of neglect or inattention could arise. The petitioner was not accused of having done something amounting to misconduct but of having omitted to do something, such omission amounting to remissness. The lowering of the flag was not the offence charged though it appears to have aroused the sentiments of the enquiry officer. The essence of the charge of negligence lay, not in the lowering of the flag, but in the omission to use force under Section 128 Cr. P. C. In considering this charge the enquiry officer committed an error. ", "43. He ignored the fact that the orders of the Senior Superintendent of Police to handle the situation tactfully contained an implied command not to use force. As the petitioner could use force only by invoking his powers under Section 128 Cr. P. C. if follows that the order of the Senior Superintendent of Police requiring him to handle the crowd tactfully contained an, implied direction not to invoke his powers under Section 128 Cr. P. C. ", "44. The question may be viewed from another angle. Suppose the petitioner had ignored the direction to handle the situation tactfully, ordered the crowd to disperse, and on their refusal scattered it by force. The numerical odds against him being over-whelming 12 against 2000 to 3000 he could have dispersed it by force only by firing upon the crowd. In any subsequent inquiry, could he have defended himself against the charge of disobeying orders on the ground that there was no order NOT to use force and he was therefore free to ignore the direction to be tactful and to prevent the lowering of the flag by using force? I do not think this defence would have prevailed, and he would have been convicted of the offence of having disobeyed the order to handle the situation tactfully. ", "45. In his finding, the Enquiry Officer has observed, \"Permitting any insult to this (the national flag) . . . cannot be considered to be a justified or correct use of discretion\". In appeal, the Deputy Inspector. General expressed himself even more strongly against the alleged insult to the national flag. He has observed : ", "\"The weakness of the appellant in allowing the lowering of the National Flag even if it was for one minute was definitely an insult to the flag and it was a serious offence under Section 7 of the Police Act . . . The appellant has mentioned the gravity of the situation . . . This however does not absolve the appellant from his own responsibility in protecting the honour of the National Flag which was under his trust ...... He had a delicate and important duty to perform in protecting the honour of the National Flag. ", "But he did not prove to be equal to the task. ... It is an admitted fact that the flag was lowered by about a foot and it was then that the mob observed silence and paid respect to it by saluting. This was definitely disrespect and not respect of the National Flag . . National Flag has got to be respected at all times and in all conditions and if any officer allows disrespect to be shown to the Flag, he is guilty of disloyalty to Government. ", "46. In revision, the Inspector General of Police Mr. , exuded the same sentiment in even stronger language. Dismissing the petitioner's revision, he observed: ", "\"The charge as established against the petitioner was of a very serious nature and he should consider himself lucky that he was not dismissed from the service for allowing the honour of the Flag to be besmirched.\" ", "47. Thus the phrases \"insult to the National flag\", \"disrespect for the national flag\" \"failure to protect the honour of the national flag\", \"allowing the honour of the flag to be besmirched\", have been freely used against the petitioner. They certainly leave an impression that throughout the proceedings the minds of the S. P., the Deputy Inspector General and the Inspector General of Police were possessed with the idea that the National Flag had been insulted and the petitioner was to blame for this insult. These observations which coloured the judgment of all the three authorities, is open to serious criticism on several grounds. In the first place, the petitioner was not being accused of the offence of wrong exercise of discretion in the matter of the flag but of remissness in not using force. Secondly, it is difficult to understand how, on the evidence on the record, it is possible to conclude that the national flag had been \"insulted\". ", "I have examined the entire record and have not discovered any evidence of any \"insult\" to the flag. The District Magistrate deposed that \"according to the report received by him, about two to 'three thousand people had collected insisting on the lowering of the flag at the thana, and that at their insistence the flag was lowered by about 1 foot and was thereafter saluted by them and put right.\" In his report to the Senior Superintendent of Police sent on the day of the incident (annexure 'A' of the petitioner's affidavit), the petitioner wrote that \"the crowd observed one minute's silence under the flag and after paying their respects to the National Flag they went back\". He also reported that before the flag was lowered one of their leaders, , delivered a short speech and \"emphasised that they had not come to dishonour the 'national flag'\". ", "48. This was the evidence on the basis of which the Superintendent, the Deputy Inspector General and the Inspector General concluded that there had been an \"insult to the national flag. It is not possible to understand how a crowd which salutes a flag can be deemed to have \"insulted\" it. The enquiry officer and the other two authorities erroneously imagined an \"insult\" to the flag. They seem to have made the lowering of the flag synonymous with insulting the flag. But the lowering of the flag does not of itself involve any insult to it. Learned Junior Standing Counsel was not able to refer to any Act of the legislature or rules or notification or orders or instructions of Government suggesting that any lowering of the flag should be deemed of itself to be an act of insult to it, nor am I aware of the existence of any such law or rule or practice. ", "This is corroborated by the order of the Additional Superintendent dated 10-11-1955 (reducing the petitioner) in which he replied to the petitioner's submission in paragraph 18 of his reply to the show-cause notice (annexure G of the petitioner's affidavit). The petitioner had submitted that \"there is no law on the subject, nor any rules framed or departmental instructions issued as to the manner in which an officer should conduct himself and behave in respect of tbe hoisting of the National flag\". The petitioner had further submitted that \"in the absence of any such statute or order prescribing any duty on the public servants in general and the police officers in particular no departmental proceedings under Section 7 , of the Police Act can be held for remissness or negligence in the discharge of duty or unfitness for the same.\" The Additional Superintendent rejected this submission and observed : ", "\"The behavior of officers towards the National Flag is a matter of world-wide custom and needs no Specific rules or law to teach individual officers the way of behaving it. Any departure from, normal behaviour is tantamount to remissness and negligence in the discharge of duty towards the flag.\" ", "49. Neither the Additional Superintendent, nor subsequently the Deputy Inspector General nor the Inspector General cared to enunciate this \"normal behaviour\" towards the flag, any departure from which might, according to the Inspector General even render an officer liable to dismissal from service for the offence of allowing the honour of the Flag to be \"besmirched\", to quote his own word. ", "50. If the lowering of the flag of itself amounts to insulting it the Union, and the State Government have been guilty of this offence frequently. They lowered the flag in 1952 when it was directed to be flown at half-mast on the death of His Brittanic Majesty King , and again in 1953 to mourn the demise of His Excellency . , Premier of the Union of Socialist Soviet Republic. It is thus obvious that the lowering of a flag is in itself no indication of 'insult' to it. To decide whether it amounts to an insult or not, one must look to the circumstances in which and the motives, with which the flag was lowered. By way of illustration, if a hostile mob attacks our embassy in a State P, hauls down the flag and burns it, this, will be an insult. ", "But if a crowd wants to compel the Government to show respect to the memory of persons whom they regard as martyrs and, on the flag being lowered by one foot, they stand to attention and salute the flag, there is no insult to the flag. They may have coerced the authorities into showing respect for the dead persons, and this coercion may perhaps be galling to them; but the coercion of an official or even the is not synonymous with \"insult to the flag\". It is noteworthy that even the charge sheet does not use the word \"insult\". But the very idea of insult to the flag appears to have coloured the judgment of the three officers and vitiates their decisions for two reasons. First it introduced a consideration which was extraneous to the issue in controversy. Secondly, the finding that the national flag was insulted could not, on the evidence before them, have been arrived at by any reasonable person and is erroneous on the face of it. ", "51. The Enquiry Officer's finding is vitiated by another and graver error. His conclusion that the petitioner was remiss in permitting the lowering of the flag without use of his powers under Section 128 Cr. P. C. is based largely on his other conclusion that some initial negligence of the petitioner led to the situation on the 15th August. To quote once again from his finding, \"I am inclined to feel that the party charged was not led to his present lapse by any cowardice or deliberate desire to save himself at the cost of the national honour represented by the National Flag but that the situation arose from his lack of full understanding of the implications of his action and his preliminary negligence in not keeping himself abreast of the situation. Under the circumstances, therefore, while I am of the opinion that he does not deserve the severest punishment of dismissal I do not consider him absolved of the initial negligence leading to the situation which necessitated; ", "his exercise of discretion and the consequent permit ting of the lowering of the flag without use of power vested in him under Section 128 of Cr. P. C., facts of which are not denied by the defence.\" ", "52. Thus the Enquiry Officer held the petitioner guilty of \"Preliminary negligence\" or \"initial negligence\" on an earlier occasion and, on the basis of this finding, convicted him of remissness or negligence on 15th August. This is clear from his earlier finding which is : ", "\"On a careful scrutiny of the evidence put up before me I am of opinion that the party charged in spite of clear orders issued from was, not keeping abreast of the developments in the students world of his political circle and did not consider legal action against students advisable at any stage.' ", "53. This finding was based largely on the evidence of the Circle Inspector which was considered and accepted by the Enquiry Officer in, these words : ", "\"He (Circle Inspector) has also given evidence that a Circular Order No. 32 was issued by on 16-7-55 which had given instructions regarding registration of cases arising from indiscipline among students. This order is exhibited as Ex. P2 and states clearly that students found guilty of acts of lawlessness must be dealt with according to law. Another order which is Secret Order No. ST (R.A.) 5-1-55 dated 25-7-55 was issued by the Addl. Supdt. of Police, Banaras, in which attention has been invited to the in disciplined acts of the students \"and the staff has been advised to develop source of information within the educational institutions, so that their preparations and developments can be known * to the police and their illegal activities, planned, may be suppressed before any adverse plan materialises; ", "This order is exhibited as Ex P. 3. Ex, P 2 has been proved by P.W. 4 H.C/S6 C. P. Satya Deo Pathak to have been seen by the Station Officer (party charged) on 21-7-55 as is apparent from the Circular Order file of . Ex. P3 was a Secret Order issued to C. Os and C. Is. and has been proved by P.W. 1 and P.W. 3 , to have been shown to the party charged among other Station Officers of the circle and their reports called as required in that order. P.W. 1 has further proved that at Moghalsarai there V had been two incidents previously also during 1955, in which students were involved on 2-4-55 and 13-4-55 in which a Communist leader and a student of , Moghalsarai, were reported to be the main agitators. ", "The report (PW 3) submitted in reply to Ex. P3 which gives these details is exhibited as Ex. P4. A report of giving details of these incidents is exhibited as Ex. ", "P5. O. D. report No. 29 dated 15-8-55 of P. S. - ", " timed at 10.30 A.M. giving details of the incident on which P.W. 1 passed orders on 18-8- ", "55 for the registration of a case under Section 143 has been exhibited as Ex P6. The case registered has been challaned.\" ", "54. The question arises; was it open to the Enquiry Officer to take into account any alleged earlier negligence in convicting the petitioner of remissness on the particular occasion specified in the charge. I think it was not. ", "55. Clause 4 of Regulation 490 of the Police Regulations prescribes what information must be contained in the charges and says : ", "\"the substance of the accusation must be reduced to the form of a charge which should be framed immediately after the preliminary enquiry, if any. This should' be as precise as possible so as to give the officer charged full information of the matters alleged against him. The charge must be read to the officer before his oral statement is recorded and in the case of an officer required to file a written statement a copy of the charge must be given to him. ", "56. Thus in an enquiry held under sec 7 of the Police Act (which is governed by the procedure prescribed in the Police Regulation) the charge must contain (1) the substance of the accusation and also (2) full information of the matters alleged against him. The word information is synonymous with facts : Clause 7 of Regulation 490 deals with Finding which the Enquiry Officer is required to give, It says: ", "\"7. The Superintendent of Police himself must write a finding. In the finding he must confine himself strictly to the subject of the charge and to the evidence on the record and must discuss every relevant plea raised by the officer charged. After arriving at a conclusion on the facts in issue, he should, if he has found the charge proved take into consideration the character and previous conduct of the officer charged before deciding what punishment, if any, as prima facie suitable.\" ", "57. This clause enjoins that the Enquiry Officer must not go outside the subject of the charge. The combined effect of Clauses 4 and 7 of the Regulation may be summed up thus; the accused officer must be served with a charge sheet which should give him in precise terms the gist of the offence together with full facts on which the offence is sought to be based. The object of this prosecution is obviously to enable the accused to collect such evidence as will enable him to contradict or explain the facts on which the charge is based. It is also intended to prevent his being taken by surprise by some entirely new facts or information disclosed during the inquiry. The injunction to give \"full information\" is intended to be strictly enforced, for it is followed up by a further injunction in Clause 7 to the Enquiry Officer to confine himself \"strictly\" to the subject of the charge. ", "58. It appears to me that the Enquiry Officer, in basing his finding on information relating to some earlier acts of negligence, did not confine himself to the subject of the charge. The charge has been quoted verbatim by me in an earlier part of this judgment. It accuses him of the offence of \"remissness in the discharge of his duty and unfitness for the same\". These are words copied from Section 7 of the Police Act and are the standard formula used in almost every charge. By themselves they would reveal almost nothing and leave the accused officer no wiser than, say a person who is told that he is \"charged with murder\". The substance of the charge and the facts (\"information is the word used by Clause 4 on which it is based) is contained in the words which follows :. ", "\"In that, while posted as Station Officer, Moghal Sarai, on 15-8-1955, he, without making use of the powers vested, in him under Section 128 Cr. P. C. permitted the lowering of the National flag at Station, Moghal Sarai sometime between 8.30 A.M. and 11 A.M. when a mob of agitators forming an unlawful assembly demanded the lowering - thereof in sympathy with the students killed at Patna in a firing earlier.\" ", "59. The substance of the charge is quite precise and the facts on which it is based are fairly detailed. As framed, it was clear enough to enable the accused officer to know the facts alleged against him. But what is the charge as revealed by the facts contained in it? It draws his attention to an incident which took place at a particular place and specified occasion and says to him in effect \"These facts prove that you were remiss in the discharge of your duties\". The petitioner came prepared to meet these factual allegations, and no others. The charge, as framed would give any reasonable person the impression that his conduct on that particular occasion was in question, and he Was called upon to explain why he had permitted the flag to be lowered without using force under Section 128 Cr. P. C. ", "60. But in his Finding the Enquiry Officer did not confine himself to the subject of the charge. He considered facts relating to events which had taken place on earlier occasions. He perused documents as evidence of facts not stated in the charge. These relate to events which took place as early as April and July 1955. The petitioner has stated in para 23 of his affidavit that none of these documents were indicated in the charge sheet, a statement not denied by the respondent. ", "Reference to these documents is in itself a violation of Clause 3 of Regulation 490 which enjoins : \"when documents are relied on in support of the charge they should be put in evidence as exhibits and the officer charged must, before he is called upon to make his defence, be allowed\" to inspect such exhibits.\" This clearly implies that if the information supporting the charge under Clause 4 includes documentary evidence, the document should be indicated in the charge and the petitioner should be given an opportunity to examine the information disclosed by them before he is called upon to file his written statement. Furthermore, any consideration of information contained in documents of a hearsay nature is forbidden by Clause 3, Some of the information contained in the exhibits filed by the prosecution witness ' Inspector was clearly hearsay. ", "61. These points are not included in the Ground of the petition nor were they argued before me in the form in which they are enunciated above. But in examining the correctness of the findings of a tribunal in quasi-judicial proceedings, this can, in the interest of justice, take notice of any error which is manifest. The order of the Enquiry Officer shows that he held the petitioner guilty of remiss-ness partly because he had been remiss on an earlier occasion. This he was clearly not entitled to do for three reasons: ", "First, the Police Regulations forbid the consideration of any material in violation of Regulation 490. Secondly, the petitioner did not have fair opportunity of proving that he was not remiss on any earlier occasion, and the Enquiry Officer's reliance on the information relating to these occasions offends against the principles of natural justice. Thirdly, the Enquiry Officer was required to hold the petitioner guilty of negligence in the incident specified in the charge sheet on the basis of facts relating to that incident : he could not hold him guilt of negligence on that day because he had been negligent on a previous day. ", "The earlier acts of remissness or negligence should have been made the subject of a separate or distinct charge. The Enquiry officer, in considering the charge before him, took into account matters which, were extraneous. As observed by in AIR 1951 SC 193, 196, \"A finding (of fact) reached on the basis of additional evidence which ought not to have been admitted would justify interference on the ground that an error of law had been committed.\" ", "62. For the various reasons detailed above I hold that the finding of the Enquiry Officer that the petitioner was guilty of remissness of duties and un-fitness for the same because he, without making use of the powers vested in him under Section 128 Cr. P. C. permitted the lowering of the National Flag at the Police station Moghal Sarai sometime between 8.30 a.m. and 11 a.m. when a mob of agitators forming an unlawful assembly demanded the lowering thereof in sympathy with the students killed at Patna in a police firing earlier \"is manifestly erroneous\". ", "63. Learned Junior Standing Counsel contended that, however erroneous, this is a finding of fact which cannot be interfered with in proceeding under Article 226. I do not agree. I have pointed out the manifest errors in the Officer's findings which are clearly errors of law apparent on the face of his order. But even, if it were regarded as a finding of fact, it exhibits an error of such, a nature as will justify the issue of a writ of certiorari. For this principle no authorities were cited at the bar, and there is no specific judgment of or dealing with a case similar in facts to the present petition. But on the authority of two recent English judgments I have come to the conclusion that the error committed by the officer can be quashed by certiorari. ", "64. The first is a judgment of the court of Appeal in v. Ex Parte Gil-more, (1957) 1 All ER 796, in which a writ of certiorari was issued by the on the ground that the which had passed the impugned order had come to a conclusion which could not reasonably have been entertained by them if they had had proper regard to a certain Regulation. The facts of the case were these. The petitioner lost the sight of his left eye in an industrial accident. He thus became entitled to disablement benefit under the National Insurance (Industrial Injuries) Act, 1946. Certain Regulations were made under the Act, and under Regulation 2(5), his disablement was to be assessed as if the injury to his right eye wag incurred as a result of losing the sight of his left eye: and, under, schedule 1 to the regulations, of the disablement for blindness in one remaining eye was to be assessed in such circumstances at a hunded per cent but a medical appeal tribunal failed to apply Regulation 2(5) and assessed the applicant's disablement at twenty per cent. The facts on which the tribunal based their decision did not appear on the face of their written adjudication, but the adjudication contained a quotation from the report of a specialist who had examined the petitioner and had detailed the) full facts relating to the previous injury in 1936 and to the injury in 1955. It was conceded on behalf of that the decision of the was erroneous in law, but, nevertheless, the of Appeal considered the question whether the error of the tribunal appeared on the face of the record. , observed as follows : ", "\"The first point is whether the error of the tribunal appears on the face of the record. It does not appear on the face of their written adjudication of 13-6-1956. There is not a word there about the right eye, or even the left eye for that matter; but the tribunal gave an extract from the specialist's report and thereby, I think, they made that report a part of the record. Just as a pleading is taken to incorporate every document referred to in it, so also does an adjudication. Once the specialist's report is read with the record, we have before us the full facts about the previous injury to the right eye and the subsequent injury to the left. ", "These facts are sufficient to disclose the error in law : for it is them apparent that the award of twenty per cent, must be wrong. No reasonable person, who had proper regard to Reg. 2(5), could have come to such a conclusion. It is now settled that, when a tribunal comes to a conclusion which could not reasonably be entertained by them if they properly understood the relevant enactment, then they fall into error in point of law; see Edwards v. Bair-stow, (1955) 3 All ER 48. When the primary facts' appear on the record, an error of this kind is sufficiently apparent for it to be regarded as an error on the face of the record such as to warrant the intervention of this court by certiorari\" ", "65. The judgment in 's case, (1957) 1 All ER 796 referred to and followed the principle adopted in a previous judgment of in (1955) 3 All ER 48. This is the second authority mentioned by me. That case did not arise out of proceedings for certiorari but out of a case stated in income-tax proceedings. It was held in that case that although an appellate court may allow an appeal from the Commissioner's determination only if it is erroneous in law, yet, where a case stated shows on the face of it no misconception of law, if it should appear to the appellate court that no person, if properly instructed in the law and acting judicially, could have reached that particular determination, the court may proceed on the assumption that a misconception of law has been responsible for the determination. The facts of that case were these. A man called and his partner were assessed to income-tax in respect of profits made by them from the re-sale of machinery which they had purchased from Messrs, . It was stated in the Statement of the Case submitted for the opinion of that the assessees had no intention of holding the plant \"what they desired was a quick purchase and re-sale\". The plant was bought for 10,000 and resold in parts to five different purchasers. The assessees made the purchase on 20-11-1946 and the process of re-selling commenced on 27-11-1946 when the bulk of the plant was sold to a firm called for 15,439-13-6. ", "The subsequent transaction of re-sale took place respectively on. January 28, June 26, and October 22. 1947 and February 20, 1948. It was common ground that the assessees and made at profit of 18,225-11-3 on the transaction which was equally divided between them. On behalf of the it was contended that the buying and selling of the plant constituted a trade or adventure in the nature of a trade and that the profits and gains arising therefrom were assessable accordingly. ", "The assessees contended that this was a transaction the profits of which could not be liable to income-tax because none of the four conditions which must be present to establish the liability existed in their case, (a) the existence of an organisation, or (b) activities which led to the maturing of the assets to be sold, or (c) the existence of special skill, opportunities, in connection with the article dealt with, or (d) the fact that the nature of the asset itself should lend itself to commercial transactions. The Commissioners for the General Purposes of the Income Tax gave their original decision in these terms : ", "\"We, the commissioners, having considered the facts and evidence submitted to us, are of opinion that this was an isolated case and not taxable and discharge the assessment\". ", "When the matter came before on the Case stated, considered this determination unsatisfactory and remitted the matter to the General Commissioners with a direction that they were to consider whether, the transaction being an isolated transaction, there was, nevertheless, \"an adventure in the nature of trade\" which was assessable to tax under case 1 of Schedule D of the Statute. He further directed that the Commissioners should be assisted in their finding by legal arguments (under, the English law income tax under 'Schedule D is charged in respect (inter alia) of profits arising \"from \" any trade, profession, employment or vocation\" and \"trade\" includes 'every trade, manufacture, adventure or concern in the nature of trade.). The Commissioners accordingly met again and, after hearing arguments and further considering the matter, submitted a Supplemental Case in which they expressed their further determination as follows : ", "\"We find that the transaction, the subject-matter of this Case, was not an adventure in the nature of trade.\" ", "After this supplemental finding, the case went again before , this time before another Judge, That learned Judge took the view that the question before the was purely a question of fact and that the finding of the Commissioners could not be upset unless it was so perverse that, as a matter of law, it could not stand. He further held that it was not possible for him to hold that the Commissioner's finding was perverse and dismissed the 's appeal with costs. ", "He considered himself bound by previous authority to hold that the question was one of fact. From the decision of , appealed to which unanimously upheld: the reasons given by the learned Single Judge and dismissed the appeal. The finally appealed to . The appeal was allowed, the decision of the Commissioner was set aside and the original assessments were confirmed. In his speech Viscount said inter alia: ", "\"Before, however, examining the authorities in any detail, I would make it clear that, in my opinion, whatever test is adopted, that is whether the finding that the transaction was not an adventure in the nature of trade is to be regarded as pure finding of fact, or as the determination of a question of law, or of mixed law and fact, the same result is reached in this case. The determination cannot stand : this appeal must be allowed and the assessments must be confirmed. ", "For, it is universally conceded that, though it is a pure finding of fact, it may be set aside on grounds which have been stated in various ways but are, I think, fairly summarised by saying that the court should take that course if it appears that the Commissioners have acted without any evidence, or on a view of the facts which could not reasonably be entertained. It is for this reason that I thought it right to set out the whole of the facts as they were found by Commissioners in this case. ", "For, having set them out and having read and re-read them with every desire to support the determination if it can reasonably be supported, I find myself quite unable to do so. The primary facts as they are sometimes called do not, in my opinion, justify the inference or conclusion which the commissioners have drawn; not only do they not justify it but they lead irresistibly to the opposite inference of conclusion. It is therefore a case in which, whether it be said of the commissioners that their finding is perverse or that they have misdirected them selves in law by a misunderstanding of the statutory language or otherwise, their determination cannot stand. ", "I venture to put the matter thus strongly because I do not find in the careful and indeed exhaustive statement of facts any item which points to the transaction not being an adventure in the nature of trade. Everything pointed the other way. When I asked learned counsel on what, in his submission, the commissioners could have reasonably founded their decision, he could do no more than refer to the contentions which I have already mentioned. But these, on examination, seemed to help him, not at all. ", "For, if it is a characteristic of an adventure in the nature of trade that there should be an 'organisation, I find that characteristic present here in the association of the two respondents and their subsequent operations. I find \"activities which led to the maturing of the asset to be sold\", and the search for opportunities for its sale, and conspicuously. I find that the nature of the asset lent itself to commercial transaction. And by that I mean what I think meant in Leeming v. (1930) 1 K.B. 279 that a complete spinning plant is an asset which, unlike stocks or shares, by itself produces no income and, unlike a picture, does not serve to adorn the drawing room of its owner. It is a commercial asset and nothing else.\" ", "He further observed : ", "\"When the commissioners, having found the so called primary facts which are stated in para 3 08 their case, proceeded to their finding in the supplemental case that 'The transaction, the subject-matter of this case was not an adventure in the nature of trade', this is a finding which is, in truth, no more than an inference from the facts previously found. It could aptly be preceded by the word \"therefore.\" Is it then an inference of fact? ......... Yet it must be clear that to say that such an inference is one of fact postulates that the character of that which to-inferred is a matter of fact. To say that a transaction is, or is not, an adventure in the nature of trade is to say that it has, or has not, the characteristics which distinguish such an adventure. But it is a question of law, not of fact, what are those characteristics, or in other words, what the statutory language means. ", "It follows that the inference can only be regarded as an inference of fact if it is assumed that the tribunal which makes it is rightly directed in law what the characteristics are and that, I think, is the assumption that is made. It is a question of law what is murder; a jury finding as a fact that murder has been committed has been directed on the law and acts under that direction.. The commissioners making an inference of fact that a transaction is, or is not, an adventure in the nature of trade are assumed to be similarly directed, and their finding thus becomes an inference of fact.\" ", "Viscount further observed that the assumption that the commissioners were rightly directed in law \"was displaced by a finding which was, on that assumption inexplicable. The misdirection may appear on the face of the determination. It did so here, I think, in the as originally stated. For, in effect, that determination was that the transaction was not an adventure in the nature of trade because it was an isolated transaction, which was clearly wrong in law. But sometimes, as in the case as it now comes before the court, where all the admitted or found facts point one way and the inference is the other way, it can only be a matter of conjecture why that inference has been made. In such a case, it is easy either to say that the commissioners have made a wrong inference of fact because they have misdirected themselves in law or to take a short cut and say that they have made a wrong inference of law. ........\" ", "66. Viscount Simonds' concluding observation was in the following significant words : ", "\"....... It is true that the decision of the commissioners is only impeachable if it is erroneous in law, and it may appear paradoxical to say that it may be erroneous in law where no question of law appears on the face of the case stated. But it can not be, and has not been questioned, that on inference, though regarded as a mere inference of fact, yet can be challenged as a matter of law on the grounds that I have already mentioned, and this is, I think, the safest way to leave it. We are warned by learned counsel for the respondents that to allow this appeal would open the floodgates to appeals against the decisions of the general commissioners up and down the country. That would cause me to alarm if decisions such as that we have spent some time in reveiwing were common up and down the country.\" ", "Lord in his speech, observed, inter alia as follows : ", "\"...... If the facts of any particular case are fairly capable of being so described, it seems to me that it necessarily follows that the determination of the commissioners, special or general, to the effect that a trade does or does not exist is not \"erroneous in point of law\"; and, if a determination cannot be shown to be erroneous in point of law, the statute does not admit of its being upset by the court on appeal. I expect the occasions when the commissioners, although dealing with a set of facts which would warrant a decision either way, show by some reason they give or statement they make in the body of the Case that they have misunderstood the law in some relevant particular. ", "All these cases in which the facts warrant a determination either way can be described as questions of degree and, therefore, as questions of fact. . . But, of course, in \"proper circumstances as a case can be described as one of fact, or as purely one of fact (if the testimonial adds anything), without going through the procedure of explaining that that is so because it is one of degree and, the facts fairly admitting of the determination come to, there is no error which justifies the court's intervention.\" ", "He further observed: ", "\"Nor do I think that there can be any real divergence of opinion as to what constitutes error of law for this purpose. Naturally, judges have not always expressed it in exactly the same terms. I will take one or two instances. As I have said, where there is an actual statement in the case which shows a misconception of the law, no one feels any difficulty. But, equally, no one supposes that the court's light, or as I would say, duty, to intervene stops at this, for example, in v. , (1925) 2 KB 753 , was prepared to overrule the commissioners' determination that no trade existed be cause, as he said (133 L.T. 582 at page 585) : ", "\"If one were trying a question of this sort with a jury, one would have to say upon those facts, \"well, now a trade is proved\", and I think that what the commissioners have done is merely to give the wrong name to a state of fact which in law amount to something else.\" ", "Lord summed up his view of the principles governing the intervention' of the court in a finding of fact in these words : ", "\"...... If the case contains anything ex facie, which is bad law and which bears on the determination, it is obviously erroneous in point of law. But without any such misconception appearing ex facie, it may be that the facts found are such that no person acting judicially and properly instructed as to the relevant law could have come to the determination under appeal. In those circumstances, too, the court must intervene. It has no option but to assume that there has been some misconception of the law and that this has been responsible for the determination. 'So there, too, there has been error in point of law. I do not think that it much matters whether this state of affairs is described as one in which there is no evidence to support the determination, or as one in which the evidence is inconsistent with, and contradictory of, the determination or as one in which the true and only reasonable conclusion contradicts the determination.\" ", "He then proceeded to apply the test laid down by him to the finding of fact arrived at by the Commissioners and observed : ", "\"..... I am bound to say, with all respect to the judgments under appeal, that I can see only one true and reasonable conclusion. The profit from the set of operations that comprised the purchase and sale of the spinning plant was the profit of an adventure in the nature of trade. What other word is apt to describe the operations? Here are two gentlemen who put their money, or the money or one of them, into buying a lot of machinery. They have no intention of using it as machinery, so they do not buy it to hold as an income producing asset. They do not buy it to consume or for the pleasure of enjoyment. On the contrary, they have no intention of holding their purchase at all. They are planning to sell the machinery even before they have bought it. And, in due course they do sell it, in five separate lots, as events turned out, And, as they hoped and expected, they make a net profit on the deal, after charging all expenses such as repairs and replacements, commissions, wages, travelling and entertainment and incidentals, which do, in fact, represent the costs of organising the venture and carrying it through. ", "This seems to me to be, inescapably, a commercial deal in second-hand plant. What detail does it lack that prevents it from being an adventure in the nature of trade, or what element is present in it that makes it capable of being aptly described as anything else?\" ........ It is said that there was no organisation for the purposes of the transaction. But, in fact, there was organisation as much of it as the transaction, required. It is true that the plant was not advertised for sale, though advertisements asking for plant were answered by the respondents. But why should they incur the cost of advertising if they judged that they could achieve the sale of the plant without it? It is said that no work had been done on the maturing of the assets to be sold. ", "But such replacement and renovation as were needed were, in fact, earned out, and I can see no reason why a dealer should do more work in making his plant saleable than the purpose of sale require, It is said that \"neither of the respondents had any v special skill from his normal activities which placed him in an advantageous position for the purposes of this transaction. It may be so, though one of them was the employee of a spinning firm. ", "In any case, the members of a commercial community do not need much instruction in the principles and possibility of dealing, and I think that, given the opportunity, the existence or non-existence of special skill is of no significance whatever. It is said, finally, that the purchase and sale of plant lent itself to capital, rather than commercial transactions. I am not sure that I understand what this is intended to mean. If it means that, at the relevant period there was no market for second hand plant in. which deals could take place, there is no finding to that --effect, and all the facts that are recited seem to be against the contention. If it means anything else, it is merely an attempt to describe the conclusion which the respondents would wish to see arrived at on the whole case.\" ", "67. I make no apology for quoting extensively from the speeches of the Noble Lords who delivered the leading judgments in this case, for the case may well prove to be another land-mark in the history of certiorari. The examined a finding by the Commissioners to the effect that a particular transaction was not an adventure in the nature of trade. There was no error or misconception of law in this finding ex facie but it was held that the finding could not stand because, on the facts, no person acting judicially and properly instructed as to the law could have given it. The examined the various links in the chain of reasonings of the Commissioners and held, in effect, that not one of them could stand the strain of rational argument. Viscount made it clear that the magic phrase \"finding of fact\" would not deter him from interfering with a decision which, though, a pure finding of fact, could not reasonably be entertained. ", "To quote from his speech once again \"I would make it clear, that in my opinion, whatever test is adopted, that is whether the finding that the transaction was not an adventure in the nature of trade is to be regarded as a pure finding of fact, or as the determination of a question of law, or of mixed law and fact, the same result is reached in this case. The determination cannot stand : this appeal must be allowed and the assessment must be confirmed.\" This decision is an authority for the principle that a finding of fact may be quashed by certiorari if on an examination of all the relevant facts on the record, the superior court holds that no reasonable person could have arrived at it. ", "68. It is significant that the commissioners' finding was quashed by in a case where there was no lack or excess of jurisdiction and no error of law ex facie. The commissioners had jurisdiction to determine whether, on the facts before them, the assessees had engaged in an adventure in the nature of trade. They held that they had not; but the superior court found the reasonings of the commissioners so unreasonable as to be inexplicable. Accordingly, they re-examined the record and held that the facts were consistent only with one finding which must be contrary to that of the commissioners. If I may say so with deep respect, these two cases taken together will rank with R. v. , (1841) 1 QB 66, v. , (1854) 9 Ex 111 and R. v. Ex Parte Shaw, (1952) 1 KB 838 as one of the landmarks in the history of certiorari. ", "69. If I may adopt the reasoning of in 's case, (1955) 3 All ER 48 the finding of the Enquiry Officer that the petitioner's permitting the National Flag to be lowered without making use of his powers under Section 128 Criminal Procedure Code amounted to remissness in the discharge of his duties and unfitness for the same cannot stand, whatever be the test adopted. Whether it is regarded as a pure finding of fact or as a pure question of law or a mixed question of law and fact the conclusion is the same. The decision must be quashed. Whether his conclusion that the lowering of the flag of itself amounts to an insult is regarded as perverse or completely extraneous to the question of petitioners' remissness, it must be set aside. ", "There is no evidence to support it, alternatively the evidence is completely inconsistent with and contradicts this finding. The only reasonable conclusion from the evidence must be that no insult to the National Flag was intended or offered and this is fatal to the impugned decision. Similarly, his conclusion, that though the petitioner was under orders to handle the situation tactfully, his action in permitting the lowering of the flag without using force under Section 128 Cr. P. C. amounted to remissness cannot stand, whatever be the legal character of this finding. If a finding of fact, it could not reasonably have been founded on the material before the Enquiry Officer. If a finding of law it must be held that no person acting judicially and properly instructed as to the relevant law (including Section 128 Cr. P. C.) would have made this decision, and it must be assumed that there has been a misconception and misapplication of the law. ", "70. A question which has caused me considerable anxiety in this case is whether this court should interfere in a matter relating to discipline concerning . This court his always shown the utmost reluctance to invoke its very wide powers under Article 226 for interference in such matters. The petitioner belongs to a service charged with the maintenance of public order. Discipline is the pillar on which rests the morale and efficiency of the service and any crack in this piller may have serious consequences. In the armed forces and the police the emphasis is laid on duties and obligation of the members rather than rights. ", "Even the Constitution recognises this fact, for Article 33 empowers to pass a law restricting or even abrogating any of the fundamental rights in their application to the Armed Forces or the Forces charged with the maintenance of public order \"so as to ensure the proper discharge of their duties and the maintenance of discipline among them.\" Thus the makers of the Constitution felt that if the Republic is ever faced with a situation in which there' can be a conflict between the enforcement of fundamental rights and the maintenance of discipline among these Farces, the latter should prevail and was invested with sufficient powers to deal with the situation accordingly. ", "71. The English Courts have shown an even stronger reluctance to interfere with the exercise of a disciplinary power in a service. In Ex Parte Fry (1954) 2 All ER 118, Lord , C. J. rejected an application by a fireman employed in for quashing a decision of the Chief Fire Officer of the Brigade holding the petitioner guilty of disobedience of orders in administering a caution, He relied on his own observation in the earlier case of v. Metropolitan Police Commissioner, Ex Parte Parker, (1953) 2 All ER 717 (721). ", "\"Where a person, whether he is a Military Officer, a Police Officer, or any other person whose duty it is to act in matters of discipline, is exercising disciplinary powers, it is most undesirable, in my opinion, that he should be fettered by threats of orders of certiorari and so forth, because that interferes with the free and proper exercise of the disciplinary powers which he has ...............\" ", "72. I have to consider whether in the present case, this court should interfere with the decision of (confirmed by the Deputy Inspector General and the Inspector General) even if the petitioner is able to prove that irregularities took place in the proceedings which ended in his reduction. ", "73. This case has features which are peculiar, if not unique. It is admitted by the State that the Senior Superintendent of Police and the Deputy Inspector General of Police (as well as the District Magistrate and the Commissioner of Varanasi) visited after the incident on the same date and approved of the manner in which the petitioner had handled the situation. As late as 19-8-1955--5 days after the occurrence -- the District Magistrate in his D. O. No. 354/S, entirely agreed with the views of the Senior Superintendent of Police Varanasi and so did the Commissioner in his D.O. No. St/L and O. BNS dated 20-8-1956 to Mr. (the then Home Secretary to ) and had stressed that it would be most unfair to take any action against the Station Officer, . ", "All these letters are referred to in the letter of the Superintendent No. ST/SSP/R-14 dated Banaras May, 28, 1956, mentioned above. But suddenly on 22-8-1955, the petitioner was suspended, and on 26th August served with a charge sheet accusing him of remissness and negligence in the discharge of his duty. Therefore, some thing must have happened between 20th August and 22nd August which compelled Senior Superintendent of Police to reverse his earlier views and, indeed, to take a complete somersault. ", "We do not know what happened except the departmental action was taken against the petitioner \"under instructions of the Inspector: General\". The has given no explanation why it revised the decision of the local authorities who were the petitioner's immediate superiors. The petitioner's counsel insinuated during his arguments that the change in attitude was due to a speech made by the Prime Minister in which he is alleged to have said that the lowering of the National flag must be treated as an insult to the flag. But there is no mention of it in the petitioner's affidavit, and the Court cannot proceed on the basis of counsel's insinuations. ", "But it seems obvious that the local authorities who exercised immediate discipline over the petitioner, would, if left to themselves, have approved of the petitioner's conduct on 15th August. In fact they had done so already. The interference came from above, whatever be the reasons and motive for it. This is therefore, strictly speaking, not a case in which the will be interfering with a disciplinary action taken by a superior officer against his' subordinate. It will be a case of interference with interference that is preventing illegal interference by a higher authority, for reasons of policy, with the decision of officers who were the real custodians of discipline on the spot. ", "74. There is another feature of this unfortunate case which deserves attention. In his defence, the petitioner had proved that a few days prior to the occurrence at Moghal Sarai a parallel incident had taken place in. the Government House at Ranch when the Governor of Bihar had, at the insistence of students, lowered the flag over the Government House at half mast. The incident is described in the petitioner's explanation to the charge-sheet in the following words (quoted from a newspaper report): \"Seven students were injured, one seriously in a lathi charge by the mounted police when a body of students broke into the Raj Bhawan in an attempt to persuade the Governor to fly the flag at half mast on Government House. The Deputy Commissioner also received injury when the students pelted stones at the mounted police. All the seven students' were carried and admitted into the Sadar hospital. Later the Governor on insistence of the students called five of them in and they lowered the flag of the Government House at half-mast.\" ", "75. The petitioner in his explanation drew attention' to the fact that the Governor of Bihar had at his disposal sufficient force consisting of armed and mounted Police to meet any situation, whereas he had no adequate force. To quote the petitioner's own words, \"on the one hand, the Governor permitted the lowering of the National Flag in spite of sufficient force being present, while on the other hand, I did so because of the inadequacy of the force\". He then gave the Enquiry Officer this significant reminder, \"It is also a fact that the Governor still continues to be the head of the Bihar State. ", "I most humbly request you to pay your kind attention to his part of your defence.\" The Enquiry Officer noted the petitioner's reference to the Bihar incident but completely ignored it in his conclusions though he discussed all the other incidents of a similar nature cited by the petitioner in which the flag had been lowered. However in his order reducing the petitioner the Additional Superintendent discussed the Bihar incident and observed, \"The example of the occurrence at Government House, Bihar, quoted by the party charged can also not be examined in the course of these proceedings in details as the circumstances obtaining for or against the matter are not available and are not directly relevant to the present case. ", "The fact that there were certain circumstances obtaining in the present case parallel to the alleged occurrence at , Bihar had already been taken (into) account in proposing the punishment to the party charged and continuing to retain in his original rank, which punishment in its totality is lighter than could normally have been proposed in such a case.\" ", "76. It is necessary to understand the import of this observation. It starts by saying that what the Governor of Bihar did was not relevant in considering what the petitioner did, but ends by saying that what the Governor of Bihar did was taken into account and consequently a comparatively light punishment was proposed in the petitioner's case. The implications of this observation are very significant. It means that as the Governor of Bihar had done precisely what the petitioner had, he was being leniently treated and reduced instead of being dismissed. This attitude may be contrasted with the epithets used by the , the and the in expressing their views about the petitioner's conduct in permitting what they considered to be an \"insult\" to the national flag. ", "If these epithets are any index they thought that the petitioner had committed one of the most serious acts of disloyalty to the State. But as they were faced with the fact that the Governor of Bihar had committed precisely the same act they let the petitioner off lightly. All this could not but leave an impression, not only on the petitioner but on the entire police force, that there is one code of conduct for persons in high places and another for officials of subordinate rank. I think it is the duty of the court when a case of this nature comes before it to dispel any impression of inequality of treatment. I hope the moment will never arrive in this republic when the common man begins to feel that if an ordinary citizen does something he will be punished but if a Governor does the same thing he will get away with it. ", "The courts have distinct duty to discourage this impression and I have to weigh this aspect of the case against any reluctance to interfere in a matter relating to discipline. Any feeling of unequal' treatment is far more likely to undermine the discipline and morale of than interference by this according to taw. I had these considerations, inter alia, in mind when in the case of v. , Civil Misc. Writ No. 2142 of 1957 I considered the application of Lord 's observation in Ex Parte Fry. (1954), 2 All ER 118 to Indian cases, and observed as follows : ", "\"I doubt whether it would be in the public interest, under the Indian conditions, to convert this principle of non-interference in disciplinary matters into a law of the Medes and Persians. This observation by must be considered in the back-ground of English traditions. In England, certain things are not done, even if there exist the power to do them. Cases of mala fide exercise or abuse of power due to bias or personal interest are rare in England. But in our social climate the temptation may not be so easy to resist. I would therefore be cautious in transplanting this English principle to 'Indian soil, and would not go so far as to lay down that this should never interfere in cases of the exercise of disciplinary powers.\" ", "77. Though this court has been reluctant to interfere in matters relating to discipline it has not hesitated to do so in suitable cases. , AIR 1954 AH 438, a Division Bench of this Court ( and .) quashed the order of the Deputy Inspector General and dismissing a Station Officer, on, the ground that the enquiry under Section 7 of the Police Act was conducted in such a manner as to deprive him of an adequate opportunity of defending himself. ", "In v. State of U.P., Writ Petn, No. 449 of 1955 a Division Bench of this Court quashed an order of dismissal on the ground that there was no legal evidence to support the finding of the Enquiry Officer that the accused official was guilty of the offence imputed to him. ., 1956 All LJ 447 : (AIR 1956 All 578) , J, quashed an order dismissing a Sub Inspector of Police on the ground that the procedure adopted in the enquiry against him violated the provisions of the Police Regulations. ", " , 1955 All LJ 748 : (AIR 1956 All 172) the same learned Judge quashed an order of the Superintendent of Kanpur dismissing a head constable from service on the ground that it was without jurisdiction. , 1958 All LJ 410 : (AIR 1958 All 584) a Division Bench of this Court quashed an order dismissing a sub-inspector of police on the ground that the departmental inquiry against the sub-inspector violated the provisions of the Regulations. There have been several other cases of a like nature. Thus, this court has not been prevented by considerations of discipline to interfere, in suitable cases, with orders passed by the authorities in the exercise of disciplinary powers. ", "78. Taking into consideration these authorities, I feel that this is not a case in which this court should hesitate to grant relief to the petitioner, when a proper case has been made out. I think the petitioner is entitled to the protection of this . ", "79. There remains the question what relief the petitioner is entitled to receive. The finding of the enquiry officer has to be quashed. As this finding is the foundation of the subsequent order of the Additional Superintendent of Police reducing the petitioner's rank, that order too cannot stand. The orders of the Deputy Inspector General in appeal and the Inspector General in Revision confirming the orders of reduction, being likewise founded on the Enquiry Officer's finding, must be set aside. ", "I allow the petition and quash the finding of the Enquiry Officer dated 20-10-1958, holding the petitioner guilty of remissness in the discharge of his duties and unfitness for the same on the ground that while posted as Station Officer Moghal Sarai on 15-8-1955, the petitioner, without making use of the powers vested in him under Section 128 Cr. P. C. permitted the lowering of the National Flag at the Police Station, Moghal Sarai sometime between 8.30 a.m. and 11 a.m. when a mob of agitators forming an unlawful assembly demanded the lowering thereof in sympathy with the students killed at Patna in a police firing earlier. I also quash the order of the Additional Superintendent of Police Varanasi dated 10-11-1955 reducing the petitioner to the lowest grade of his rank for a period of two years; and the order of the Deputy Inspector General of Police Eastern Range Varanasi, dated 26-6-1955 dismissing the petitioner's appeal and of the Inspector General of Police Uttar Pradesh dated 20-3-1957 rejecting the petitioner's revision. The respondents shall pay Rs. 300/-as costs to the petitioner."], "relevant_candidates": ["0000346402", "0000431220", "0000577270", "0000649393", "0000983398", "0001270113", "0001450722", "0001673100", "0001742802", "0001954356", "0001959866"]} {"id": "0000513563", "text": ["JUDGMENT ", "1. This is an appeal against the order of the Subordinate Judge of Mayavaram refusing to accept the bid of , the appellant, for taking on lease certain property, the subject-matter of a suit before the , and directing a re-sale. What happened was, the Receiver, who had been appointed in the suit, was directed by the to sell by public auction the lease of certain lands in suit for a year. The conditions of sale were printed and the printed leaflets were circulated. The Receiver held an auction in which the appellant before us, , was the highest bidder. When the matter was taken to the Sub-Judge for confirmation, he refused to accept 's bid and directed a re-sale. It is against that order that this appeal is filed. ", "2 The appellant contends that a completed contract had been entered into with him by the Receiver and that the should, therefore, have directed a lease to be executed in his favour in the terms of his bid. At the re-sale ordered, the second respondent took the lease at a higher rate. A preliminary objection has been raised to this appeal that no appeal lies. The appeal has been filed under Order XLIII, Rule 1, Clause (s) as against an order under Order XL, Rule I, Civil Procedure Code. We need not, however, decide this question, as we think that, on the merits, the appellant has no ease. The Receiver is an Officer of and whatever powers he exercises are delegated powers of the which the expressly gives him. He has no nowers except what the grants him. Unless the appellant can show us that in this case the has delegated its power of entering into a completed contract with third parties to the Receiver, any action taken by the Receiver cannot be binding upon the or upon the properties. All that the appellant is able to show us is that he made the highest bid and that the published conditions of sale did not expressly state that the was subject to the confirmation of the . The absence of such a statement cannot, in our opinion, be treated as implying that the had abandoned its power of confirming the sale before it would take effect. No doubt the ordinary rule regarding private auction is, that where an auction is held without any reservation, there is an implied condition that the highest bid will be accepted; but no authority has been cited to show that that rule applies to a sale by a Officer under the directions of . In sales, it is acceptance by the that constitutes the contract. (1888) 15 Cal. 253. The person who asserts that the Officer had power to bind the by his acceptance of a bid must prove it. The appellant has not been able to refer us to any evidence to show that such a power had been granted by the in this case. We must, therefore, hold that the bad ample authority as no contract had been concluded with him and the 's order directing a re-sale was within its powers. The appeal fails and is dismissed with costs (costs one set). ", "3. C.R.P. No. 943 of 1923 is dismissed with costs."], "relevant_candidates": ["0001248519"]} {"id": "0000554725", "text": ["PETITIONER: STATE OF PUNJAB & ORS. Vs. RESPONDENT: INDER SINGH & ORS. ETC. DATE OF JUDGMENT: 14/10/1997 BENCH: A.S. ANAND, S. RAJENDRA BABU ACT: HEADNOTE: JUDGMENT: ", "WITH CIVIL APPEAL NOS 8302/95 AND 1939/97 AND CIVIL APPEAL NOS 7137-38 AND 7145-47 OF 1997 (Arising out of SLP (C) Nos. 2584, 4937, 3679, 3745 and 12685 of 1996) J U D G M E N T D.P. Wadhwa J. ", "Leave granted in all the special leave petitions. In this batch of appeals, it is the State of Punjab in which is the appellant. There are in all 18 respondents. They were all enrolled as Constables in and later deputed to (CID) of . During the course of their deputation, they earned promotions on ad hoc basis and some of the respondents reached the rank of ad hoc Sub-Inspectors. When they were sought to be repatriated to their parent departments, they were to go back as Constables or Head Constables if in the meanwhile on deputation they earned any promotion in their parent departments. They had served long years in the CID and the prospect of going back as Constables was not to their liking. They, therefore, approached and Haryana by filing writ petitions which were allowed to an extent. did say that the order of repatriation of the respondents being legal could not be set aside as such. However, directions were issued that the cases of the respondents in their parent departments to considered for promotions on the relevant dates when person junior to them were promoted at different levels and, if necessary, even to relax the rules. In some of the cases two directions were given, namely, (1) if the respondents sought voluntary sought voluntary retirement from the posts they were holding in CID, the order of repatriation would not come in their cases for voluntary retirement be considered on the basis of the posts they were holding in CID; and (2) to determine the seniority of the respondents in their parent departments by giving them the benefit of service they rendered in CID and consequently to be considered for promotion with effect from the date the persons junior to them were promoted. ", "To understand the rival contentions, we shall consider the case of one of the respondents (CA Nos. 1293-1303 of 1996). He was enrolled in on August 31, 1966 as Constable and on April 13, 1969 was sent on deputation to in the same rank. He was sought to be repatriated on September 15, 1990 while he was holding the rank of ad hoc Sub-Inspector. During this period of deputation, , by order dated February 19, 1985 was promoted as officiating Head-Constable after giving him exemption under the relevant rules which we will consider hereinafter. In the parent , he was holding the substantive rank of Head Constable. During the pendency of the writ petition in , we are told that there was stay of order of repatriation. was not, however, given any posting till the judgment was delivered by . On November 7, 1994, he was posted in the unit at Faridkot. However, this joining was subject to final decision of the present appeal. This at the time of the admission of the special leave petitions granted status quo which is continuing. The appellant has, therefore, contended that from the date of repatriation, remained absent uptil November 6, 1994. Taking into account this period of four years, was on deputation in for over 28 years. We may note that the has not taken any action against for his alleged absence from the date of the order of repatriation till the order of this rejoining and his posting at Faridkot. The High in granting relief to respondents negatived the contention of the that the respondents could not be promoted to higher posts in their parent departments without passing the various departmental examinations as per the relevant Rules. That was how dealt with these contentions first by allowing the writ petitions by the learned judge and then on appeal before filed by the against the judgment of the learned single Judge. The High was of the view that in terms of sub-rule (3) of Rule 21.25 of Rules, when an officer borne on the rolls of a district or range reached a place in seniority which would entitle him to be considered for substantive promotion if he were serving in the establishment to which he belonged permanently, he shall be informed and given the opportunity to return to the district police force. The said that admittedly, the writ petitioner, who was sent on deputation to the , was not so informed and given the opportunity to return to his parent when he was entitled to be considered for substantive promotion to the higher post. As held by the learned single Judge, the appellant who failed in its statutory duty to inform the petitioner when his juniors in the parent department were considered for promotion to the higher post, could not take advantage of its own wrong. The writ petitioner while on deputation to , Intelligence , was found fit and had been promoted as Sub-Inspector on 12th December, 1989, and was holding that post on the date when the order for the repatriation to his parent department was issued. The High said that in view of such peculiar facts, it would be a good ground for relaxing the rule for considering him for promotion to the higher post with effect from the date his immediate juniors were so promoted in accordance with the directions given by the learned Single Judge. The respondent in the writ petitions had prayed for writ of certiorarl for quashing the order of repatriation and a writ of mandamus directing the petitioner to absorb him in (Intelligence ) where he had put in 23 years of service or directing the petitioner to determine the seniority of the respondent in his parent department after giving him benefit of service which he had rendered for 23 years in the and consequently to promote him from the date when his juniors were promoted. ", "The Rules are called Punjab Police Rules and have been framed under the Police Act 1861. It is not necessary for us to quote the relevant Rules in extenso except Rule 21.25 dealing with deputation to CID which is as under: ", "\"21.25(1) Upper and lower subordinate posts other than those of inspectors in shall be filled by the deputation of suitable men from districts for periods three years extensible by not more than two years at a time at the discretion of the Deputy Inspector-General, . ", "(2) A Police officer on deputation to will retain his original position in the cadre of his district or range. While in he will be eligible for officiating promotion in that branch; on reversion from he will assume his place in his original cadre. Officiating promotion may be given in the district or range in the place of an officer deputed to , such officiating post lapsing on the officer's reversion. ", "(3) When an officer borne on the rolls of a district or range reaches a place in seniority which would entitled him to be considered for substantive promotion if he were serving in the establishment to which he belongs permanently, he shall be informed and given the opportunity of returning to district police work. No officer on deputation to shall be substantively promoted to head constable or higher rank unless both the Deputy Inspector-General, and the Deputy Inspector-General, and the Deputy Inspector-General of the range to which he belongs agree that he is qualified for such promotion by all the prescribed standards. ", "(4) The Deputy Inspector-General, , may make recommendation on behalf of, sub-inspectors serving under him to the Deputy Inspector serving under him to the Deputy Inspector- ", "General of the range and the Inspector-General of Police, respectively, for promotion to the selection grade or admission to List F. A sub-inspector who becomes eligible while serving in for grade promotion in the selection grade, shall receive such promotion, if the Deputy Inspector- ", "General of the range and agree that he is fit for it. ", "(5) Annual reports on upper subordinates serving on deputation in shall be sent by , to the range Deputy Inspector-General concerned for record and other necessary action. ", "(6) In very exceptional cases and for the political branch only and with the written sanction of the Deputy Inspector-General personally, direct enrollment as constable or in higher ranks, may be made to . ", "Specialists shall, however, when possible, be entertained on contract terms control, terms, so that their services may be dispensed with then their utility ceases or deteriorates. ", "21.25(A) The Deputy Inspector- ", "General, , shall have complete disciplinary control over all police offices while serving in the .\" ", "Rules also described the duties of by that is not necessary for us to refer to. ", "Rules relating to promotion and deputation are quite specific and there is no ambiquity about them. Each district/Range (Districts are grouped into Ranges) has its own cadre of officers upto certain ranks. We are concerned with the rank upto Sub-Inspector. Promotion from one rank to another and from one grade another in the same rank is on the basis of selection-cum-seniority. What factors are to be taken into consideration for promotion have been set out in Rule 13.1 and which are of general nature. Upto the rank of Sub-Inspector five lists A,B,C,D and E are to be maintained for the purposes of promotions from the Constable and contain the names of the candidates as per their seniority after they have fulfilled the specified requirements. List A contained the names of the Constables who were eligible for promotion to the selection grade and is maintained by the Superintendent of Police of the District. List B contains the names of all Constables selected for admission to the promotion course for Constables at . Selection is made in the month of January each year and is limited to the number of seats allotted to the district for the year with twenty per cent reserve. is constituted which conducts tests in general law (Indian Penal Code , Criminal Procedure Code , Indian Evidence Act and Local and Special Laws), interviews and examination of records and prepares the merit list, Rule 13.7 (2) prescribes the eligibility criteria of the Constables who are to be entered in List-B. Those Constables who have passed the Lower School Course at Phillaur and are considered eligible for promotion to Read Constables are entered in List-C. Promotions to Head Constables are made in accordance with the principles set out in Rule 13.1(1) and (2). Selection grade Constables who have not passed the Lower School Course but are otherwise considered suitable can be promoted to Head Constables upto a maximum of ten per cent of vacancies but that can be done with the approval of the Deputy Inspector-General of Police. Similarly D List is maintained for selection for admission to the promotion course for Head Constables at is made from amongst, all the confirmed Head Constables. Eligibility for admission to the promotion course for Head Constables is prescribed in Rule 13.9(1). Those Head Constables who qualify at in the promotion course for Head Constables find their names entered in Part-I of List-D. Rule 13.9(2) prescribes that names of outstanding Head Constables who have not passed the promotion course for Head Constables due to being over-age but otherwise are of exceptional merit and are considered suitable may, with the approval of Inspector-General of Police, be entered in Part II of List D. Further under this sub-rule no more than in per cent of the posts of Assistant Sub-Inspectors will be filled from the names in Part II of List D. Promotions to the post of Assistant Sub-Inspectors are to be made from List D (Part II). Similar procedure is prescribed for promotion of all Assistant Sub-Inspectors to Sub-Inspector from List E (Part-I) which contains the names of Assistant Sub-Inspectors who qualified for promotion course for Assistant Sub-Inspectors at List E is also in two parts. Part II of List E contains the names of Assistant Sub-Inspectors of exceptional merit who have not qualified the course for Assistant Sub-Inspectors at and are considered suitable for promotion. ", " does not have a cadre of its own officers upto the rank of Sub-Inspectors. Rules 21.25 states that posts other than those of Inspectors in shall be filled by the deputation of suitable men from districts for period three years extensible by not more than two years at a time at the discretion of the Deputy Inspector-General, . A police officer on deputation to the retains his original position in the cadre of the district or range. While in the he is eligible for officiating promotion in that branch but on reversion from he assume his place in his original cadre. Sub-rule (2) of Rule 21.25 also prescribes that officiating promotion may be given in the district or range in the place of an officer deputed to but such officiating post lapsing on the officer's reversion. Under sub-rule (3) of this rule when an officer while on deputation in reaches a place in seniority in his district he is entitled to be considered for substantive promotion as if he was serving in that district but he shall be informed and given the opportunity of returning to his district police work. This sub-rule further prescribes that no officer on deputation to shall be substantively promoted to Head Constable or higher rank unless both the Deputy Inspector-General, and the Deputy Inspector- General of the range to which the officer belongs agree that he is qualified for such promotion by all the prescribed standards. It would appear that under this sub-rule while on deputation with earned his promotion as officiating Head Constables without his having to have passed Lower School Course in Phillaur and thus promoted to Head Constable out of 10 per cent of vacancies as having been found suitable for the promotion. ", "In the writ petition of he raised the following four questions which according to him needed consideration: ", "\"i) Whether the respondents were bound to absorb the petitioner in the C.I.D. Intelligence department where he had put in 23 years service and had excellant and unblemished service record? ", "ii) Whether the respondents are justified in repatriating the petitioner after more than 23 years of service and that too without giving him any benefit of 23 years of service which he has rendered in ?' ", "iii) Whether the respondents are justified in repatriating the petitioner as constable to his parent department when his juniors have been promoted and are working on the post of sub Inspectors and Inspectors? ", "iv) Whether the order of repatriation is discriminatory and violative of Articles 14 and 16 of the Constitution of India? ", "As to what relief granted we have noted above. ", "We find that the respondents have not challenged their repatriation to their respective districts on the rolls of which they are borne but what they contend is that they should hold the same position there as they were holding in . They submitted that while they were on deputation to their juniors have been promoted and now if they go back they have to work under them. These contentions do not appear to us to be correct. For one the respondents do not have any right to hold on the post which they were having in in their parent department and (2) they were holding the posts in only on and hoc basis. Appellants have brought on record a chart to show that even Constables who were senior to the respondents are still working as Constables as they could not qualify for further promotion in terms of the Rules mentioned above. In the case of no Constable junior to him has been promoted and there are 65 Constables who are senior to who are still working as Constables. Respondents have been contended that as per sub-rule (3) of Rule 21.25 they were never informed and given no opportunity of returning to their respective districts after they reached their places in seniority of their districts entitling them to be considered for substantive promotion. In the case of appellants have stated that old record of test for List-B was not traceable. However, has given his unwillingness to undergo Intermediate School in the term commencing with effect from April 1, 1990 to October 1, 1990. For promotion from Constable to Head Constable passing of B-1 test is a must. was not eligible to appear in the test for the first three years as he had not completed three years of service. Subsequently also he did not appear in any test held for the purpose. However, he was promoted on February 19, 1985 as officiating Head Constable by order of the Senior Superintendent of Police, Ludhiana from List C having been given exemption. Appellants have stated that since test is held in January every year circular/letters are issued to the organisations including then where their employees are working asking them to appear in the test. This test is held on the same date throughout the State. The Constables who are eager to compete are always on the alert to appear in the test as it is known to all the Constables that the test is being held. Appellants have also brought on record that apart from the fact that every Constable on deputation in would come to know of the test, the respondents were also individually informed except that in the case of one or two of the respondents records were not available to show that they had also been individually informed of the test being held. On the dates of holding of the test eligible candidates assemble at the prescribed place where the test is conducted. Several Constables serving in the on deputation appeared in B-1 test. So it is very well known to every Constable wherever he may be, the appellants submit. It would, therefore, appear to us that there cannot be any excuse that the candidates were not aware of the holding of the test. ", "It is when submitted that deputation to could not exceed a period of five years after the expiry of this period the respondents should have been sent back to their respective districts and that after all this period on deputation to now asking them to appear in test would not only be irregular but arbitrary as well. We do not think that sub-rule (1) of Rule 21.25 limits the deputation to for a maximum period of five years. In the first instance deputation is for three years and it can be extended for not more than two years at a time. It cannot be said that after three years the extension is for further two years and no more. We have to give an ordinary meaning to the words used in the sub-rule. We, however, agree with the respondents that every time deputation was extended they should have been informed of their rights in while on deputation vis-a-vis their parent department. ", "Mr. , learned counsel for the appellants, State of Punjab, submitted that repatriation of the respondents was necessary as Government thought of injecting fresh blood in CID. It appears to be rather a specious plea. It is not disputed that officers having put in more years than the respondents are still working on deputation in CID. No reason is forth-coming as to why the respondents are the only persons who are picked up to be repatriated. But since this question was not raised in these terms we are not called upon to decide the same. ", "It was then submitted by the respondents that deputation to had no meaning as all the police departments in the State are headed by the Inspector General of Police who is also the administrative head of . Reference in this connection was made to Rules 1.2, 1.4 and 1.5. It is, however, not necessary for us to refer to these Rules as we do not find any substance in this contention. Rules are statutory and each district/range in the State has a separate cadre of its officers. There is no cadre of officers upto the rank of Sub inspector in and the officers upto this rank are drawn from various districts in the State. Merely because the administrative head of all the police departments in the State is one it cannot be said that there can no rule for deputation to a particular department in the whole of the police establishment in the State. If we refer to the Rule 21.25 Deputy Inspector General, has complete disciplinary control over all the police officer while serving in that department. On this very reasoning, there is no scope for the argument that respondents be absorbed in as this has no cadre of its own upto the rank of Sub-Inspector. ", "It was then submitted that officers in CID are of exceptional merit and they have vast experience of conducting investigation and in fact they help the district police in the conduct of investigation and that they should be given exemption from appearing in tests or undergoing any training in and that they should be promoted in 10 per cent quota meant for officers of special qualities. If that is done it will certainly be in violation of the statutory rules. Promotion has to be by prescribed standards. Moreover it is nobody's case that any vacancy exists to which the respondents could have been promoted. In any case we are not impressed with this argument. ", "Mr. appearing for more of the respondents submitted that the case of (CA 1297/95) was different. In his writ petition (No. 8979 of 1991) in it was mentioned in order dated June 12, 1991 that was working as Sub-Inspector in CID and was being repatriated as Head Constable to his parent department. ordered that he shall be repatriated as Sub-Inspector and it shall be open to the authorities to determine his seniority in the parent department in accordance with law. On clarification sought by the the court order dated March 6, 1992 states that it shall be open to the to determine the seniority of and post him to the post he was entitled to and that the order dated June 12, 1991 would not confer any benefit on him. We, therefore, fail to see how this case is any different or that would be posted as Sub Inspector in his parent department on repatriation. ", "During course of arguments, certain decisions of this court were referred to on the question of deputation and the right of the deputationist on his repatriation. These, we may note. . [1991 Supp. (2) SCC 162], the appellant who was working as a Tracer in Ahmedabad went to by way of deputation. In the , the appellant was promoted as Junior Draftsman and there was a proposal to promote him further as Surveyor-cum-Draftsman. But before this promotion could materialise, the was wound up. The appellant was, therefore, reverted back to his parent department, i.e., and posted as a Tracer and not as a Junior Draftsman. The appellant treated this as a reversion and challenged the same. This Court said that it was not reversion and that when the appellant left and joined the , he was a Tracer and he could go back only as a Tracer subject, however, that if in the meantime, while he was on deputation, he had qualified for promotion to a higher post in the parent department, that benefit could not be denied to him. The Court said that promotions earned by an employee on deputation did not enjoin any protection and that on repatriation, he could be accommodated only on its original post or to the post to which he stood notionally promoted in the parent department by having so qualified. . (1990) 1 SCR 414], the appellant who belonged to was allocated to on coming into force of , 1961. He went on deputation as Circle Inspector in and was later reverted back to his parent cadre in . This was challenged by the appellant. This Court held that the appellant being on deputation could be reverted to his parent cadre at any time and he did not get any right to be absorbed on the deputation post. . [1994 Supp. (3) SCC 471]. it was held that when a deputationist was repatriated, he could not claim promotions in the parent department on the basis of officiation in higher post in the borrowing organisation. . Through Secretary, , Administrative Reforms & Ors. [(1988) 8 SCR 147], the question before this Court which fell for consideration was whether the service rule requiring eight years of approved service as Section Officer both for the direct recruits as well as for promoters for being eligible for consideration for promotion to the Grade-I post in the was arbitrary being in contravention of Articles 14 and 16 of the Constitution of India. This Court laid the following principle: ", "\"The rule-making authority is competent to frame rules laying down eligibility condition for promotion to a higher post. When such an eligibility condition has been be Said that a direct recruit who is senior to the promotees is not required to comply with the eligibility condition and he is entitled to be considered for promotion to the higher post merely on the basis of his seniority. The amended rule in question has specified a period of eight years' approved service in the grade of Section Officer as a condition of eligibility for being considered for promotion to Grade I post of C.S.S. This rule is equally applicable to both the direct recruit Section Officers as well as the promotee Sections Officers. The submission that a senior Section Officer has a right to be considered for promotion to Grade-I post when his juniors who have fulfilled the eligibility condition are being considered for promotion to the higher post, Grade I, is wholly unsustainable. The prescribing of an eligibility condition for entitlement for consideration for promotion is within the competence of the rule- making authority. This eligibility condition has to be fulfilled by the Section Officers including senior direct recruits in under to be eligible for being considered for promotion. When qualifications for appointment to a post in a particular cadre are prescribed, the same have to be satisfied before a person can be considered for appointment. Seniority in a particular cadre does not entitle a public servant for promotion to a higher post unless the fulfils the eligibility condition prescribed by the relevant rules. A person must be eligible for promotion having regard to the qualifications prescribed for the post before he can be considered for promotion. ", "Seniority will be relevant only amongst persons eligible. Seniority cannot be substituted for eligibility nor it can over-ride it in the matter of promotion to the next higher post. The rule in question which prescribes a uniform period of qualified service cannot be said to be arbitrary or unjust violative of Articles 14 or 16 of the Constitution.\" ", "In view of the clear statement of law, the respondents before us cannot claim promotion in their parent department in contravention of statutory Rules as they do not satisfy the eligibility conditions. ", " . [], the appellant was appointed in of the State Government as Second Division Clerk. He was sent on deputation to which was then part of as Assistant Civil Supplies Inspector. There he was promoted as Second Grade Civil Supplies Inspector. There was a seniority dispute between the appellant and Mr. who was appointed in the Food Wind of . The Court found that at all levels of appointments and promotions, the appellant was always senior to Mr. . But fact remained that the appellant continued to be on deputation in the Food Wing of right from 1967 to 1986. When the appellant was sought to be repatriated, he approached which by order dated January 28, 1988 directed absorption of the appellant in holding that he had not been given any performa promotion in his parent department and that there was no valid ground to reject his request for absorption and that the appellant was entitled for a direction to the respondents to absorb him in in the post them told by him. The appellant was, thus, absorbed and was placed above . The appellant was then promoted as Assistant Director on January 1, 1980. Similarly, was also promoted as Assistant Director. The question before this Court was of the inter se seniority between the appellant and . This Court agreed that as per Rules, the appellant could not have been sent on deputation to higher post than the post held by him in the parent Department. But then the Court said that he had uninterruptedly worked in and under those circumstances though initially the appellant might have been mistakenly deputed to hold higher post in , but \"Since the appellant had obviously discharged his duties and higher responsibilities to the satisfaction of all concerned, at this distress of time, it is highly unjust to send him back to hold the post in the parent department which he was entitled to hold and the Tribunal is not right to interfere with action of the department in its absorption of the appellant as per its own earlier order\". This judgment is quite distinguished and of no help to the respondents as the question which falls squarely for consideration before us was not there and the appellant in that case had been absorbed by the department. In the present case before us, there is no separate cadre to which the respondents or any one of them could be absorbed. . [], the appellant who was working in as Inspector was sent on deputation to at Nagpur. He remained there from 1961 to 1975 and earned promotion. His last promotion being that of Assistant Director. When he came back to his parent department, he was appointed as Assistant Director on ad hoc basis. While he was on deputation, his juniors in the parent department were appointed as Assistant Directors on ad hoc basis. After the decision of this Court in [] where it was held that all those officers who were appointed as Assistant Directors in should be deemed to have been appointed substantively from the date of their ad hoc appointment. In consequence thereof, they became senior the appellant. This Court held that the appellant was similarly situated along with those who were granted benefit by this Court and merely because the appellant was working in the at the relevant time, he could not be prejudiced. The Court extended the benefit given in case (supra) to the appellant as well. Again this decision does not support the case of the respondents before us. ", "Concept of \"deputation\" is well understood in service law and has a recognised meaning. `Deputation' has a different connotation in service law and the dictionary meaning of the word `deputation' is of no help. In simple `deputation' means service outside the cadre or outside the parent department. Deputation is deputing or transferring an employee to a post outside his cadre, that is to say, to another department on a temporary basis. After the expiry period of deputation the employee has to come back to his parent department to occupy the same position unless in the meanwhile he has earned promotion in his parent department as per Recruitment Rules. Whether the transfer is outside the normal field of deployment or not is decided by the authority who controls the service or post from which the employee is transferred. There can be no deputation without the consent of the person so deputed and he would, therefore, know his rights and privileges in the deputation post. The law on deputation and repatriation is quite settled as we have also been in various judgments which we have referred to above. There is no escape for the respondents now to go back to their parent departments and working there as Constables or Head Constables s the case may be. ", "It is no doubt really harsh on the respondents to be sent back after they have served the for number of years in higher rank though on ad hoc basis and now when they go back they have to work either as Constables or Head Constables. It was submitted before us that an employee could seek voluntary retirement after putting in 20 years of qualifying service and that in the impugned judgment gave option to the respondents to seek voluntary retirement while still working in the and holding higher ranks. This option can, however, be limited to only those respondents who have put in 20 years of qualifying service as per the relevant Rules. In our opinion, was justified in giving such an option to the respondents to seek voluntary retirement. At the time when special leave petitions were filed against the impugned judgment of , this Court directed that status quo be maintained while staying the impugned judgment of . in the writ petitions filed by the respondents granted stay of the orders of repatriation. After the impugned judgment, there was order of status quo by this Court. In this view of the matter, the respondents continued to be in the . We affirm he impugned judgment of to the extent that the respondents who put in 20 years of qualifying service in their parent departments and in would be entitled to seek voluntary retirement from the ranks they are holding in and the period of qualifying service would be counted upto the dare of this judgment. These options the respondents shall give within 30 days from the date of this judgment. The respondents who do not give such option and those respondents who have not put in 20 years of qualifying service would have to revert back to their parent departments. ", "It is in fact an admitted position that Constables on deputation to have reached higher ranks and retired from in those ranks. A hope, though not true, is instilled in officers like the respondents that they would continue in the holding higher ranks till the age of superannuation. The conduct of the appellants now suddenly asking the respondents to go back to their parent departments when they have put in best years of their lives in would appear to be rather unjust. It would have been more appropriate for the appellant to repatriate the respondents after the expiry of the initial period of deputation or at least they should have been told the consequences of their continuing on deputation and sudden repatriation. It would also be more appropriate, considering the fact that the deputation in could be for any number of years, that the rules are amended and a separate cadre is created in to absorb the officers, if they are on deputation for a number of years. It is submitted before us that Constables who have come on deputation to retired while holding higher ranks in and they earned their pension on the basis of their holding higher ranks though the pension was being paid by their parent department. This may be on the basis of relevant pension rules as applicable in the State. Now, if the respondents go back to their parent department and work their as Constables or Head Constables their emoluments would be reduced considerably and they would be deprived of getting higher pension when they retire. ", "Considering the whole aspect of the matter we affirm the order of to the extent that option be given to all those respondents who have put in 20 years qualifying service to seek voluntary retirement from the in the ranks they are holding and they will be deemed to have worked in upto the date of this judgment. The option shall be given within 30 days. ", "Except as aforesaid the appeals are allowed and the impugned judgment is set aside. Writ Petitions filed by the respondents are dismissed. There will be no order as to costs."], "relevant_candidates": ["0000463488", "0000568992", "0000745749", "0000968709", "0001355072", "0001612820", "0001724485"]} {"id": "0000576325", "text": ["JUDGMENT , C.J. ", "1. The question referred to us for decision is-- ", "Is it open to an undischarged insolvent to maintain a suit regarding his after-acquired properties subject to the right of the Official Receiver to intervene in such proceedings? ", "2. In our view, upon the facts of this case this question does not arise and we are not disposed to enter into any further discussion of this question which is purely one of academic interest. ", "3. The facts of the case may be quite shortly stated. The insolvent was the plaintiff in . He was also an undischarged insolvent. His case as set out in the plaint was that he got emeralds from one for sale and that he gave them to the defendant in the suit for sale. The value of the emeralds was fixed, so he alleges, at Rs. 1,000 and it was agreed that the excess realised by the defendant by the sale should be shared equally between the plaintiff and the defendant. He sued to recover the emeralds or Rs. 1,000 the price of the emeralds and for Rs, 250 being his share, as he alleged, of the profits made by the defendant on the allegation that the defendant sold the emeralds for Rs. 1,500 and he asked for the return of the emeralds in case they were not sold by the defendant. Amongst other contentions the defendant raised the plea that: the plaintiff was an undischarged insolvent and was consequently not entitled to sue. An issue was taken upon that contention and the District Mun-sif found that the plaintiff was an undischarged insolvent, but that he could maintain the suit for recovery of the articles bailed. I wish to draw particular attention to the fact that the articles were described by the District Munsif as articles bailed. Then there was an appeal and the first fixed the value of the emeralds at Rs. 800 and gave the plaintiff a decree for that amount only. The case came up on second appeal to this Court and the question of the maintainability of a suit by an insolvent with reference to after-acquired property was raised and in view of the fact that a Letters Patent Appeal raising this very point was then pending decision by a Full Bench, our learned brother , J., adjourned the case until the Opinion of the Full Bench was delivered. The Letters Patent Appeal, however, abated and the matter again came before our learned brother who, in view of what appears to be a difference of view in a case decided by and , ., in (1923) 45 M.L.J. 827 and a later decision of in (1927) L.R. 54 LA. 190: I.L.R. 54 C. 595: 52 M.L.J. 734 (P.C.) referred the case to us. ", "4. Upon the facts of this case the plaintiff's suit was divided into two parts: (1) relating to his commission of Rs. 250--that claim has been held against, and (2) for the return of or the value of the emeralds which he handed over to the defendant for sale. In our view, the first essential in the appellant's case is that the emeralds themselves or their cash value should vest in the Receiver as the after-acquired property of the insolvent under Section 28 of the Provincial Insolvency Act. That section deals both with the actual property of an insolvent at the time of his adjudication and property which may pass into his possession after the adjudication. In the case of property coming into his possession after adjudication--it is after-acquired property--that shall forthwith vest in the Receiver. There is another class of property dealt with in that section and that is the reputed property of the insolvent. Upon the facts of this case the value of the emeralds can in no sense of the word be described as the property of the insolvent. His own case was that this property was given to him by for sale. He was a jeweller and goldsmith and so was the defendant. So that in the ordinary course of business, according to his own case, these emeralds were entrusted to him for sale. That statement in his case completely negatives any position occupied by him other than as a bailee of goods for sale and it is important to remember that this statement that there had been an entrustment to the insolvent of these emeralds as a bailee is not controverted anywhere in the written statement of the defendant. Clearly the emeralds were not the property of the insolvent but it has been urged before us that although they are not the property of the insolvent, they may yet be his reputed property. ", "5. Where goods, precious stones and such like things are given into the hands of a goldsmith or a jeweller either for the purpose of being converted into ornaments or for sale, they are given to him in the ordinary way of his business; and assuming that at the time of his adjudication he is in possession of those jewels, clearly they are not his jewels at all but they are the jewels of the bailor and as such, being easily identifiable, do not pass to the Receiver in the insolvency. The further question arises as to what is to happen if he has recovered the proceeds of the sale. Here again if those proceeds have not been inter-mixed with the money belonging to the creditors and can easily be identified, the money does not vest in the Receiver but this case is a stronger one from the respondent's point of view because the jewels had been parted with and the insolvent had no money in his possession which he had received in respect of the sale. He claims in his suit to get that money from the defendant. If he succeeds, no one, I think, would contest that that money is clearly ear-marked as money belonging to the real owner of the jewels, namely, up to the extent of the agreed value Rs. 1,000 and is not available at all for distribution by the Receiver arnongst the creditors in the insolvency. This matter, I think, is made perfectly clear by the notes to Section 38 , which is the vesting section, in the English Bankruptcy Act of Williams on \"Bankruptcy,\" 13th Ed., p. 229. The marginal note is \"Trusts arising from employment of bankrupt,\" and the note says: ", "Lastly, then, there is the third class of trusts where the bankrupt has not the general, but only a special property, e.g., where property is vested in the bankrupt as an agent, such as a factor, etc. Such property, so long as it or its proceeds remain distinguishable from the mass of the bankrupt's property, will not pass to the trustee of the creditors. ", "6. Then again at page 230 it is stated: ", "It is always to be remembered that, although goods in the hands of an agent may be easily distinguishable, they may yet, on the bankruptcy of the agent, pass to his trustee if the principal has permitted the agent to have a possession not consistent with the ordinary usages of trade, and raising a reputation of ownership in the bankrupt. ", "7. Here the case for the plaintiff uncontradicted by the defendant in his written statement is that there was no entrustment at all which was not consistent with the ordinary usages of trade. As before stated, the insolvent was a jeweller and goldsmith and he himself says that the emeralds were entrusted to him for sale--that is what a jeweller and goldsmith does--and it cannot be said that the emeralds or their value were the reputed property of the insolvent. Under these circumstances and upon the facts of this case the question before us really does not arise. It would arise if the property were property which vested in the Official Assignee or the Receiver as the case may be. Therefore we decline to decide the question. We need express no opinion upon what would happen had the property been the after-acquired property of the insolvent. With regard to the claim for Rs, 250 no question arises with regard to that because that claim has been disallowed in all the Courts. ", "8. The case must, therefore, be dealt with by the referring Judge in the light of these observations."], "relevant_candidates": ["0000003060", "0000757856"]} {"id": "0000608874", "text": ["PETITIONER: THE BENGAL IMMUNITY COMPANY LIMITED Vs. RESPONDENT: THE STATE OF BIHAR AND OTHERS. DATE OF JUDGMENT: 04/12/1954 BENCH: ACT: Constitution of India-Arts. 141, 226, 286(1), (2) and (3)- Art. 286(1)(a) read with the Explanation-Construction of- Whether controlled by Art. 286(2)- Situs of a sale or purchase determined by general law or created by fiction in the Explanation-Whether relevant for ascertaining inter- character of such sale or purchase Appellant company registered in Calcutta-Bihar Sales Tax Act, 1947 (Bihar Act XIX of 1947)-S. 13-Whether appellant company liable to Sales Tax-Where goods delivered in the of Bihar as a direct result of sale for purposes of consumption there- Art. 226- Petition thereunder-Maintainability of- whether competent to modify or review its prior decisions- Art. 141- Meaning of-Bihar Sales Tax Act, 1947, s. 33-Taxing sales or purchases taking place in the course of inter- trade- Vilidity of-Act whether wholly ultra vires and void. HEADNOTE: The appellant company, having its registered office in Calcutta and its factory and laboratory in the District of 24-Parganas in West Bengal, carried on the business of manufacturing and selling sera, vaccines, biological products and medicines. It was registered as a dealer under the Bengal Finance (Sales Tax) Act: Its products having extensive sales throughout India and abroad were despatched from Calcutta against orders accepted by the appellant company in Calcutta. It had no agent or manager in Bihar nor any office or laboratory in that . A notice under s. 13(5) of the Bihar Sales Tax Act, 194,7 was issued by the Bihar Sales Tax authorities calling upon the appellant company to apply for registration and to submit returns showing its turn over for a period between the 26th of Janu- ary, 1950 and 30th September 1951. The appellant company denied its liability on the grounds inter alia that it was not resident in Bihar, it carried on no business there and none of its sales took place in Bihar. It characterized the notice ' under s. 13(5) as ultra vires and illegal and called upon the Sales Tax authorities to cancel it forth-, with. The Bihar Sales Tax authorities maintained that all sales in West Bengal or in any other under which goods had been delivered in the of Bihar as a direct. result of the sale for the purposes of consumption in that were liable to Bihar Sales Tax. Ultimately the appellant company presented before ,at Patna a petition under Art. 226 of the Constitution claiming the reliefs mentioned above. dismissed the. petition holding that it was not maintainable. On appeal under a certificate 77 604 under Art. 132(1) of the Constitution:- , (per curiam) (i) that was not right in holding that the petition under Art. 226 was misconceived. In so holding overlooked the fact that the petitioners' contention was that the Act, in so far as it purported to tax a non-resident in respect of inter- sales or purchases of goods was ultra vires the Constitution. There are various provisions in the Act laying down certain conditions, which dealers must comply with or submit to. They constituted restrictions on the fundamental right guaranteed to every citizen of India by Art. 19(1)(g) of the Constitution and these onerous conditions could not be justified as reasonable restrictions within the meaning of clause (6) of Art. 19 and further the remedy under the Act cannot be said to be adequate and was indeed useless if the Act providing for such remedy was itself ultra vires and void: (ii)that there is nothing in the Constitution which prevents the from departing from a previous decision of its own if the court is satisfied of its error and its baneful effect on the general interests of the public. , per , ACTING , , and . (, and , dissenting) that the present is a fib case for reviewing the previous majority decision of the in . ( S.C.R. 1069), in view of several circumstances relating to the case. , per , ACTING , , and . . (, and , dissenting). The operative provisions of the several parts of Art. 286 , namely clause (1)(a), clause (1)(b), clause (2) and clause (3) are intended to deal with different topics and, one cannot be projected or read into another and therefore the Explanation in clause (1) (a) cannot be legitimately extended to clause (2) either as an exception or as a proviso thereto or read as curtailing or limiting the ambit of clause (2). The sales or purchases made by the appellant company which were sought to be taxed by the of Bihar actually took place in the course of inter- trade or commerce. not having by law otherwise provided, no law could, therefore, tax these sales or purchases, that is to say, Bihar could not tax by reason of clause (2) although they fell within the Explanation and other s could not tax by reason of both clause (1)(a) read with the Explana- tion and clause (2). What is an inter- sale or purchase continues to be so irrespective of the where the sale is to be located either under the general law when it is finally determined what the general law is or by the fiction created by the Explanation. The situs of a sale or purchase is wholly irrelevant as regards its inter- character. 605 Until by law made in exercise of the powers vested in it by clause (2) of Art. 286 provides otherwise, no can impose or authorise the imposition of any tax on sales or purchases of goods when such sales or purchases take place in the course of inter- trade or commerce and the majority decision in .. ( S.C.R. 1069) in so far as it decides to the contrary cannot be accepted as well founded on principle or authority. In view of the above interpretation upon Art. 286 the charging section of the Bihar Sales Tax Act, 1947 read with the relevant definitions cannot operate to tax inter- sales or purchases and as has not otherwise provided, the Act, in so far as it purports to tax sales or purchases that take place in the course of inter trade or commerce, is unconstitutional, illegal and void. The Act imposes tax on subjects divisible in their nature but does not exclude in express terms subjects exempted by the Constitution. In such a situation the Act need not be declared wholly ultra vires and void for it is feasible to separate taxes levied on authorised subjects from those levied on exempted subjects and to exclude the latter in the assessment of the tax. (per , and ). The scheme of Art. 286(1)(a) is, that it fixes the situs of the sales with a view to avoid multiple taxation and for that purpose it divides them into two categories- inside sales and outside sales and enacts that a cannot tax an outside sale. When in the same context the Explanation declares that a sale in the course of inter- trade must be deemed to have taken place in the in which the goods are delivered for consumption, its purpose is clearly to take it out of inter- trade and stamp it with the character of an intrastate sale. Whether regard is had to the object of the enactment or its language, the Explanation must be held to authorise the imposition of tax by the delivery . Article 286(2) applies to sales in the course of inter- trade. The sales which fall within the Explanation are intrastate sales. The grounds covered by this two provisions are distinct and separate. Each has operation within its own sphere, and there is no conflict between them. According to the view expressed by in . ( S.C.R. 1069) and by in ( S.C.R. 53) Article 286(2) controls the Explanation. This cannot be sustained on the language of the enactment. The Explanation is not expressed to be subject to Art. 286(2). Nor does the latter contain the words \"notwithstanding anything contained in the Explanation to Art. 286(1)(a)\". These are simple and familiar expressions used by the legislature when it intends that a particular provision in the Statute should be subject to or override 606 another. Nor is there anything in the language of the explanation providing that its operation is not to be in praesenti but contingent on ary legislation under Art. 286(2). To construe, therefore, Art. 286(2) as controlling the Explanation, one must import into-the Statute words which are not there and thereby cut down the operation of the Explanation which on its terms is of equal authority and potency with Art. 286(2). The impugned Act in so far as it authorises the imposition of tax on sales falling within the Explanation to Art. 286(1)(a) is neither ultra vires the powers of the Legislature nor bad on the ground that it is extra- territorial in its operation. Per J. The only reasonable construction of Art. 286(1)(a) taken with the Explanation is that this provision while intended to prohibit taxation by s on outside sales was also meant to demarcate the boundary between inside sales and out., side sales and to assimilate one particular category of outside sales into the field of inside sales and to make it available for taxation by the consuming . JUDGMENT: ", "CIVIL APPELLATE JURISDICTION: Civil Appeal No. 159 of 1953. Appeal under Article 132(1) of the Constitution of India from the Judgment and Order dated the 4th December 1952 of at Patna in Misc. Judicial Case No. 241 of 1952: ", " (, and , with him) for the appellant company. was wrong in holding that there was no warrant for issuing a writ under article 226 of the Constitution on the facts of the case. Although no actual assessment was made by the Sales Tax authorities the issue of notice by them constituted a sufficient threat which had jurisdiction to quash by means of a writ under article 226 of the Constitution: see ( S.C.R. 1122), . ( S.C.R. 1069), ( S.C.R. 572), The King v. -Commissioners for the General Purposes of the Income-Tax for Kensington ( 3 K.B. 429), General Commissioners for the purposes of Income Tax.for Kensington v. ( 1 A.C. 215), v. ( I.T.R. 214), ( 1 S.C.R. 423), ( S. C. R. 135). Article 286(2) which is in Part XII of the Constitution is meant to implement the supremacy of with regard to inter- State trade or commerce. That Article puts an embargo on the power of to levy any tax with respect to interState trade or commerce. Only when the embargo is lifted by appropriate ary Legislation that can levy any tax on sales or purchases in the course of inter-State trade or commerce. Article 286 puts a fetter on s and the Explanation to article 286(1) (a) does not confer any power on to levy any tax. The Explanation is meant to explain only clause (1) (a) of article 286 , that is, what is an outside sale or purchase. It does not remove fetter and it does not convert any inter-State sale or purchase into an intrastate transaction. See the judgment of in . ( S.C.R. 1069) and that of in ( S.C.]V. 53). The construction of the Explanation by the learned Judges of is not correct. They were wrong in assuming that if article 286(2) is construed in a full and unqualified sense, the Explana- tion to article 286 (1) (a) would become nugatory and of no effect. They also erred in holding that the Explanation expressly confers legislative power, and that the Explanation is in the nature of an exception which excludes a particular class from a larger class. erred in holding that the Explanation created a nexus for conferring jurisdiction on . Test of territorial nexus is no longer applicable after the coming into force of the Constitution. . ( -S.C.R. 1069). On a proper reading of all the sections of the Bihar Sales Tax Act, 1947 the idea seems to be that the intention was only to tax the dealers within the State of Bihar, as some of the provisions of the Act would be incapable of enforcement outside the State. Consequently the appellant which has no office or agent within the State could not be taxed. See ss. 1 , 2(c) , 2(g) , 4 , 10 , 14-A , 17 , 26(a) (c) (b) & (k), of the Act. has no power to authorise imposition of tax on outside dealers. The legislative competence of is derived from Article 246 read with the Lists. Under article 245(2) is given power to enact legislation with respect to extra-territorial operation. has no such power. The combined effect of article 246(3) read with item 54 of List 11 is that is competent only to make law imposing tax on sale or purchase of goods for the whole or any part of that State. Under article 245 of the Constitution power is limited within the boundary of the State. Taxable event must happen in that State. See v. Attorney-General for Ireland ( A.C. 276), v. Attorney-General for Newfoundland ( A. C. 820) and v. Attorney-General for New South Wales ( A.C. 455). failed to appreciate the true effect of the judgment in sand ( 75 I.A. 87). The Australian case cited by viz.) for Road Transport and Tramways (New South Wales) ( 52 C.L.R. 189) has been overruled in v. State of-New South Wales ( 3 All. E.R. 607). ", ", Attorney-General of India ( and , with him), for the State of West Bengal (Intervener). Bihar Sales Tax Act has to be read as a whole and on a correct reading of the Act it clearly appears that the Act is intended to apply only to dealers in Bihar. Bihar cannot tax the sale because it takes place in the course of inter-State trade or commerce and the State is barred from taxing such sales by reason of clause (2) of article 286. The question is whether the majority view in the case of . ( S.C.R. 1069) is correct. Article 245 read with Entry 54 in List 11 gives the Legislative power whereas article 286 imposes restrictions on such Legislative power of a State. There are four restrictions placed by that article- the first by clause (1) (a), the second by clause (1)(b), the third by clause (2.) and the fourth by clause (3). Basis of article 286(2) is to ensure freedom of movement throughout the country which principle is to be found in article 301. Article 286(2) gives authority to the to watch over the principles underlying article 301 and to see what restrictions are necessary. In determining the ambit of clause (2) it is not permissible to apply the Explanation. If you do so then logically you must also apply it to clause If the majority decision in state of ( S.C.R 1069 ) id right on the interpretation of clause(2) then that clause (2) then that clause becomes absolutely meaningless. ", " can overrule its previous decision if it is satisfied that the decision was erroneous: v. ([1898] A. C. ", "375), In re Transferred Civil Servants (Ireland) Compensation ([1929] A.C. 242), The case (No. 1) (18 C. L. R. 54), v. All wright (321 U.S. 649; 88 L. Ed. 987) and v. (I.L.R. [1944] Nag. ", "342). ", "Even if the ban imposed by clause (2) of article 286 did not apply, Bihar is not competent to tax on a reading of article 246(3 ), Entry 54, List II and article 289(1)(a). The word sale in Entry 54 means passing of property in the sense of the Sale of Goods Act , S. 4 . ( 1 S.C.R. p. 243). On a true construction of the Explanation to article 286(1) ", "(a) Bihar is competent to levy a purchase tax and not a sales tax in respect of transactions entered into by dealers residing outside. The Explanation cannot be read as extra- territorial. It must be read as consistent with article ", "245. Although had. extra-territorial power under the Government of India Act, 1935 did not have such power. The position is the same under the Constitution: The, Governor-General in Council v. ([1944] F.C,R. 229) and In re (A.I.R. 1951 Mad. 583). So far, nexus theory has been applied to extra-territoriality as between two independent States. Decision of in case is applicable to component parts of the same State; (1953] S.C.R. 677), . ( S.C.R. 1069, 1078) and The Governor-General in Council v. ( F.C.R. 229). It is doubtful if nexus theory is applicable to this kind of legislation. In any event the\" nexus theory is not applicable under the Constitution of India. If machinery for enforcement of the Act has extra- territorial operation and is linked up with the charging section the whole scheme of taxation is bad due to the provisions of article 245. In any event the machinery is bad. ", ", Attorney-General of India ( and ,, with him) for , (Intervener) supported the appellant. (, with him) for (Intervener) adopted the arguments of the Attorney-General and referred to ( 2 M.L.J. 353), (A.I.R. 1953 Mad.91) , Monghyr. The State of Bihar (A I.R. 1950 Pat.'450), . (A.I.R. 1954 Pat. ", "14), on Interpretation of Statutes, 10th Edn., p. 148 and on Statute Law, 5th Edn,, p. 174. ", " ( and , with him) for the respondent (State of Bihar). ", "611 ", "Article 246(3) read with Entry 54 of List II is by itself enough to grant legislative competence to the making of laws imposing tax on sales of inter-State character having a real and sufficient territorial connection with the taxing State. Delivery of goods within the State where such delivery takes place in performance of the contract of sale is by itself real and sufficient territorial connection. The position was the same under section 100 of the Government of India Act, 1935 read with Entry 48 of List II. A legislation on the basis of a real and sufficient connection is not invalid on the ground of extra-territorial operation. The Governor- General in v. (1944 F.C.R. 229), ( 75 I.A. 86), (Public Officer) v. (New South Wales) (56 C.L.R. 337), Commissioners of Taxation v. (1900 A.C. 588) and In re (A.I.R. 1951 Mad. 583, 588). So far as conception of sale is concerned it comprises of several elements. The situs of the sale is where the various ingredients of the sale take place. Article 286(1) (a) does not govern the whole of interState trade or commerce. It does not apply to a case where goods are delivered in the purchasing State for purposes other than consumption. Article 286 (1) (a) has no application to cases where the Explanation itself does not apply. If a Bengal dealer sells to a Bihar purchaser and delivery takes place in Bihar and if the purpose is consumption then the Explanation applies and Bihar alone can tax. If the purpose is not consumption the Explanation does not apply, the matter is set at large, and States will be entitled to tax on ' the nexus theory. The ban imposed by clause (2) of article 286 does not apply to cases covered by article 286(1) (a). The class of sales falling under the purview of Article 286(1) (a) form a special class of inter-State sales which on general principles of interpretation cannot be affected by the general provisions of clause (2). Article 286(1) (a) and article 286(2) are exactly on the same topic and they are to achieve the same purpose, i.e., elimination of multiple taxation on a single sale. The device employed in article 286(1) (a) read with the Explanation is to convert inter-State sale into an intra-state sale and thereby to localise a sale and to take away the taxing power of other States. Article 286(1) (a) and article 286(2) are complimentary to each other and they have to be interpreted harmoniously so that each of them can operate within its own field. Whilst article 286(2) comprises all classes of inter-State trade, article 286(1) (a) deals with a special class. If article 286(2) applies to cases covered by article 286 (1) (a) and the Explanation then it will result in discrimination against local trade in favour of inter- state trade and this will be inconsistent with the pro- visions of Part XIII of the Constitution. The purpose of article 286 being to eliminate - multiple taxation and article 286(1) (a) having achieved that purpose in regard to a class of sales falling within it, it is no longer necessary for that purpose to apply article 286(2) to the aforesaid class. The Constitution itself has divided into two categories. In regard to one class it has itself provided as to which State will tax the sale and under what conditions. In regard to the other class the Constitution itself has imposed a ban in general terms and granted power in general to relax that ban to such extent as thinks fit. The sale though of an interState character has been converted into an intrastate sale by reason of the legal fiction. If power of taxation is given all ancillary powers are included in that very power. ", ", Advocate-General of Madras (, with him) for the of Madras (Intervener). A is sovereign within the limits of the subject matter of List II as well as within its geographical area. The test of legislative competence both as regards the subject matter and the geographical limits is the same whether it is the or . As to the subject matter the rule that applies is that of \"pith and substance\" and incidental invasion of the other Lists is permitted. As to area, the test is the territorial connection or nexus as the limiting factor. The connection must be relevant and real and if the connection is real then any impact on persons, things, acts or events, outside the is permissible and valid. The word 'extra-territoriality is used in the sense of legislation with respect to conduct of citizens when they are outside the country. [Reference was made to Charter Act of 1833, s. 43 , Government of India Act, 1915, s. 65(1) (a), v. The Queen (9 A.C. 117), the Commissioner of Stamp Duties (New South Wales) v. and another (48 C.L.R. 618), v. (Queens Land) (53 C.L.R. 534), v. (New South Wales) (56 C. L. R. 337) ]. Under the Government of India Act, 1935 the requirement of levying sales tax was that the goods belonging to the seller must be located within the Province and that those goods should have been made the subject matter of a sale transaction. To establish territorial connection for sale transaction the sine qua non is that the goods belonging to the seller must be located within the Province and that the goods should be made the subject matter of a sale transaction. The Explana- tion to article 286 (1) (a) is a deliberate reversal of the pre-existing position. ", ", Advocate-General of Madhya Pradesh and (I. N. Shroff, with them) for the State of Madhya Pradesh (Intervener). Whereas the legislative power of all, States under article 246(3) read with Entry 54 List II to tax all outside transactions of sale or purchase has been curtailed or restricted by clause I (a) and also by clause (2) of article 286 the said legislative power of the delivery State is fully saved by the Explanation of clause I ", "(a) and is not subject to the provisions of clause (2). Every delivery State is competent to tax extra-territorially ", "-within the ambit of - the Explanation and is not fettered by clause (2). Clause (2) puts a ban on all inter-State transactions except those covered by the Explanation. The contention that the Explanation does not come into effect until the ban under clause (2) is lifted by is incorrect and untenable and moreover such a contention directly contravenes the provisions of article 394 of the Con- stitution. The operation of the Explanation excludes the operation of clause (2) and vice versa. Sales Tax is in fact and substance only a purchase tax paid on one and the same transaction. Intention was to put an end to the evil of multiple taxation. ", ", Advocate-General of Punjab ( and , with him) for the state of Punjab (Intervener). Article 286(1) (a) like article 286(2) deals with only sales or purchases which take place during the course of inter- State trade or commerce, i.e., trade or commerce in which more than one State have interest. The words 'inter-State trade or commerce' have to be given the widest possible meaning. The Explanation has the effect of divesting a transaction of its inter-State character. v. (1950 A.C. 235 and v. The (76 C. L. R. 1). Assuming that has jurisdiction to overrule its own decision there is no reason for doing so. See Denning on The Changing Law, 1935 ., p. 5. , Advocate-General of Mysore, ( and , with him) for the State of Mysore, , Advocate-General of Rajasthan (, with him) for the State of Rajasthan, , Advocate-General of Pepsu (, with him) for the State of Pepsu, and , for the State of Uttar Pradesh, and , for the State of Orissa and and , for the State of Travancore-Cochin (Interveners), supported the respondent. ", " replied. ", "1955. September 6. The judgment of , Acting Chief Justice, and was delivered by Acting Chief Justice. , , and , delivered separate judgments, . C.J.-This appeal, filed under a certificate of fitness granted by , is directed against the judgment of that High Court pronounced on the 4th December 1952 whereby it dismissed the application made by the appellant company under article 226 of the Constitution praying for ,an appropriate writ or order quashing \"the proceedings issued by the opposite parties for the purpose of levying and realising a tax which is not lawfully leviable on the petitioners\" and for other ancillary reliefs. ", "The relevant facts appearing from the petition filed in support of the appellant company's aforesaid application are as follows: The appellant company is an incorporated company carrying on the business of manufacturing and selling various sera, vaccines, biological Products and medicines. Its registered head office is at Calcutta and its laboratory and factory are at Baranagar in the district of 24-Perganas in West Bengal. It is registered as a dealer under the Bengal Finance (Sales Tax) Act and its registered number is S. L. 683A. Its products have extensive sales throughout and abroad. The goods are dispatched from Calcutta by rail, steamer ,or air against orders accepted by the appellant company in Calcutta. The appellant company has neither any agent or manager in Bihar nor any office, godown or laboratory in that State. On the 24th October 1951 the Assistant Superintendent of Commercial Taxes, Bihar wrote a letter to the appellant company which concluded as follows:- ", "\"Necessary action may therefore be taken to get your firm registered under the Bihar Sales Tax Act. Steps may kindly be taken to deposit Bihar Sales Tax dues in any Bihar at an early date under intimation to this Department\". ", "On the 18th December, 1951 a notice was issued by the Superintendent, Commercial Taxes, Central Circle Bihar, Patna calling upon the appellant company (i) to apply for registration and (ii) to submit returns showing its turnover for the period commencing from the 26th January, 1950 and ending with the 30th September, 1951. This notice was issued under section 13(5) of the Bihar Sales Tax Act, 1947 (hereinafter called the Act) read with rule 28. It was drawn up according to Form No. 8 prescribed by the rules and was headed \"Notice of hearing under section 13(5) \". The reason for issuing this notice, as recited therein, was that on information which had come to his possession the Superintendent was satisfied that the appellant company was liable to pay tax but had nevertheless wilfully failed to apply for registration under the Act. Thereafter there was some correspondence between the appellant company and the Bihar Sales Tax authorities to which it is not necessary to refer in detail. Suffice it to say that while the appellant company denied its liability on the ground, inter alia, that it was not resident in Bihar, it carried on no business there, none of its sales took place in Bihar and that it did not collect any sales tax from any person of that State, the Bihar Sales Tax authorities maintained that under section 33 , which was substantially based on article 286 of the Constitution and was inserted in the Act by the President's Adaptation Order promulgated on the 4th April, 1951, all sales in West Bengal or any other State under which the goods had been delivered in the State of Bihar as a direct result of the sale for the purpose of consumption in that State were liable to Bihar Sales Tax. Eventually on the 29th May, 1952 the Assistant Superintendent of Sales Tax, Bihar called upon the appellant company to comply with the notice by the 14th June, 1952 and threatened that, in default of compliance, he would proceed to take steps for assessment to the best of his judgment. The appellant company by its letter dated the 7th June, 1952 characterised the notice under section 13 (5) as ultra vires and entirely illegal and called upon the Superintendent to forthwith rescind and cancel the same. On the 10th June, 1952 the appellant company presented before at Patna a petition under article 226 claiming the reliefs herein before mentioned. The respondents did not file any affidavit in opposition controverting any of the alle- ", "617 ", "gations of facts made in the petition and it must) accordingly, be taken that those facts are admitted as correct by the respondents. dismissed the petition on the 4th December, 1952 but on the next day issued a certificate, under article 132(1) of the Constitution, that the case involved a substantial question of law as to the interpretation of the Constitution. Hence the present appeal. ", "In view of the importance of the issues involved in this appeal Madras, Uttar Pradesh) Madhya Pradesh, West Bengal, Orissa, Punjab, Pepsu, Mysore, Travancore- Cochin and Rajasthan applied for.and obtained leave to intervene in this appeal. Similar leave was applied for by and was granted to , and one . The State of West Bengal, , and have supported the appellant company while the rest of the interveners have opposed the appeal. ", "Before the question of maintainability of the. petition was raised by the respondents as a preliminary objection and it was answered in their favour by . In its judgment noticed that facts bad not been investigated nor had the liability of the appellant company been determined and that in fact no order of assessment had been made. It pointed out that it was not a case for the Sales Tax Officer usurping a jurisdiction not vested in him by law or acting in excess of his jurisdiction or acting mala fide. took the view that the Act undoubtedly conferred jurisdiction on the Sales Tax Officer to investigate the question of liability of a dealer to Sales Tax under the Act and accordingly he was acting well within his jurisdiction in issuing the impugned notice. If on assessment the Sales Tax Officer erroneously holds the appellant liable to any tax, the Act provides for rectifying that error by appeal or revision under sections 24 and 25 of the Act. According to such a decision, however erroneous, will, nevertheless, be a decision within the ambit of his jurisdiction and cannot interfere with it by a writ of prohibition or certiorari to quash. accordingly held that the petition was not maintainable and was liable to be dismissed. We are unable to agree with the above conclusion. In reaching that conclusion appears to have overlooked the fact that the main contention of the appellant company, as set forth in its petition, is that the Act, in so far as it purports to tax a nonresident dealer in respect of an inter-State sale or purchase of goods, is ultra vires the Constitution and wholly illegal. In the impugned Act there are various provisions laying down conditions which dealers must comply with or submit to, namely, to give only a few instances, compulsory registration of dealers ( Section 10 ), filing of returns ( Section 12 ), attendance and production of evidence in support of the return ( Section 13 ), production, inspection and seizure of books of account or documents and search of premises ( Section 17 ). Section 26 prescribes penalties for contravention of the provisions of the Act. These and other like provisions in the Act undoubtedly constitute restrictions on the fundamental right to carry on business which is guaranteed to every citizen of India by article 19(1)(g) of the Constitution. If, as contended, the Act is ultra vires the Constitution and consequently void these onerous conditions can never be justified as reasonable restrictions within the meaning of clause (6) of that article as this Court held in the case of (1). The same view was also expressed in the .(2), and again only recently in . Pradesh(3). It is urged that the appellant being a company is not a citizen and cannot, therefore, claim any fundamental right under article 19 which is available only to citizens and, therefore, the decisions of this Court referred to above have no application. While it is noteworthy that the second case mentioned above (1) 3 S.C.R. 572. ", "(2) [1953] 4 S.G.R. 1069, 1077. ", "(3) [1951] 5 S.C.R. 1122, 1127. ", "619 ", "was concerned with the rights of a company, it is, nevertheless, unnecessary, for the purposes of this appeal, to decide whether a juristic person like a company is a citizen as defined in Part II of the Constitution and as such entitled to the benefits of Article 19. Nor is it necessary to consider whether there has been any infraction of the right to equal protection of the laws guaranteed by article 14 in that being a juristic person it cannot claim any of the rights under article 19 which only citizens can do. It is also true that article 31 which protects citizens and non-citizens alike cannot be availed of as it deals with deprivation of property otherwise than by way of levying or collecting taxes as held by this Court in (1) and that, therefore, the Act does not constitute an infringement of the fundamental right to property under that article. It is, however, clear from article 265 that no tax can be levied or collected except by authority of law which must mean a good and valid law. The contention of the appellant company is that the Act which authorises the assessment, levying and collection of sales tax on contravenes and constitutes an infringement of article 286 and is, therefore, ultra vires, void-and unenforceable. If, therefore, this contention be well founded, the remedy by way of a writ must, on principle and authority, be available to the party aggrieved. ", "It has been argued that the application was premature, for there has, so far, been no investigation or finding on facts and no assessment under section 13 of the Act. The appellant company, contending, as it does., that the Act is ultra vires and void,- should have ignored the notice served on it and should not have rushed into at this stage. This line of argument appears to us to be utterly untenable. In the first place, it ignores the plain fact that this notice, calling upon the appellant company to forthwith get itself registered as a dealer, and to submit a return and to deposit the tax in a treasury in Bihar, places (1) (1951] 2 S.C.R. 127. ", "79 ", "620 ", "upon it considerable hardship, harassment and liability which, if the Act is void under article 265 read with article 286 constitute, in present , an encroachment on and an infringement of its right which entitles it to immediately appeal to the appropriate Court for redress. In the next place, as was said by this Court in (1), when an order or notice emanates from or any of its res- ponsible officers directing a person to do something, then, although the order or notice may eventually transpire to be ultra vires and bad in law, it is obviously one which prima facie compels obedience as a matter of prudence and precaution. It is, therefore, not reasonable to expect the person served with such an order or notice to ignore it on the ground that it is illegal, for he can only do so at his own risk and peril. This Court has said in the last mentioned case that a person placed in such a situation has the right to be told definitely by the proper legal authority exactly where he stands and what he may or may not do. ", "Another plea advanced by the respondent is that the appellant company is not entitled to take proceedings praying for the issue of prerogative writs under article 226 as it has adequate alternative remedy under the impugned Act by way of appeal or revision. The answer to this plea is short and simple. The remedy under the Act cannot be said to be adequate and is, indeed, nugatory or useless if the Act which provides for such remedy is itself ultra vires and void and the principle relied upon can, therefore, have no application where a party comes to Court with an allegation that his right has been or is being threatened to be infringed by a law which is ultra vires the powers of the legislature which enacted it and as such void and prays for appropriate relief under article 226. As said by this Court in (supra) this-plea of the, stands negatived by the decision of this Court in (1) 3 S.C.R. 135, 148,149. ", "621 ", "( (supra). We are, therefore,Of the opinion, for reasons stated above, that *as not right in holding that the petition under article 226 was misconceived or was not maintainable. It will, therefore, have to be examined and decided on merits. ", "Coming, then, to the merits of the petition, the principal question is whether the tax threatened to be levied on the sales made by the appellant company and implemented by delivery in the circumstances and manner mentioned in its petition is leviable by the State of Bihar. The legal- capacity of the State of Bihar to tax these sales is questioned on the following grounds, namely:- (A) that the sales sought to be taxed having taken place in the course of inter-State trade or commerce and not having by law provided otherwise, all States are debarred from imposing tax on such sales by reason of article 286(2); ", "(B) that even if the ban under article 286(2) did not apply, the State of Bihar is not competent to impose tax on such sales on a correct reading of article 246(3) read with Entry 54 of List II in the Seventh Schedule and article 286(1); ", "(C) that the Bihar Sales Tax Act, 1947 can have no extra- territorial operation and cannot, therefore, impose tax on such sales by a non-resident seller- ", "(D) that on a true construction of the Act itself, it does not apply to the sales sought to be taxed. ", "Re (A): The main controversy in this appeal has centered round this ground. It raises a question of construction of article 286 of the Constitution. In the judgment under appeal took the view that sales or purchases in the course of inter-State trade or commerce referred to in article 286 (2) must be construed so as to exclude the particular 'Class of sales or purchases described in the Explanation to clause (a) of article 286 (1) and that, therefore, the provisions of the Bihar Sales Tax Act , 1947, in so far as they purported to impose tax on such sales, were not in conflict with article 286 (2) as so construed. After this decision of the question came up for consideration before a Constitution Bench of this in . (supra). the majority of that Bench held that article 286(1)(a ), read with the Explanation thereto and construed in the light of articles 301 and 304, prohibited the taxation of sales or purchases involving inter-State elements by all States except the State in which the goods were actually delivered for the purpose of consumption therein and that clause (2) of article 286 did not affect the power of the State in which delivery of the goods was so made to tax the sales or purchases of the kind mentioned in the Explanation, the effect of which was to convert such inter-State transactions into intrastate transactions and to take them out of the operation of clause (2) of that article. It is quite clear that if this majority view is to prevail this ground urged by learned counsel for the appellant company and strongly supported by the learned Attorney-General appearing for the interveners, the State of West Bengal and , and by learned counsel for must fail. It has, accordingly, been pressed upon us that we are not bound by the majority decision in that appeal from Bombay and that it is still open to us to examine and ascertain for ourselves the true meaning, import and scope of the article in question. Learned counsel for some of the interveners question our authority to go behind the majority decision. It is, therefore, necessary at this stage to determine this preliminary question before entering upon a detailed discussion on the question of construction of article 286. In England, has imposed upon its power of review of earlier precedents a limitation, subject to certain exceptions. The limitation thus accepted is that it is bound to follow its own decisions and those of courts of Co-ordinate jurisdiction, and the \"full\" is in the same position in this respect as a division consisting of three members. The only exceptions to this rule are: (1) the is entitled and bound to decide which of the two conflicting decisions of its own it will follow; (2) the is bound to refuse to follow a decision of its own which, though not expressly overruled, cannot, in its opinion stand with a decision of ; and (3) the is not bound to follow a decision of its own, if it is satisfied that the decision was given per incuriam, e.g., where a Statute or a rule having statutory effect which would have affected the decision was not brought to the attention of the earlier . [See v. (1) which, on appeal to , was approved by Viscount in L.R. 1946 A.C. 163 at p.. 169]. A decision of upon a question of law is conclusive and binds the in subsequent case. An erroneous decision of can be set right only by an Act of Parliament. [See v. )]. This limita- tion was repeated by Lord in v. ). ", " in Australia, which is the highest Court in that Commonwealth, has not adopted such a rigid rule. In the case(3) the rule was thus laid down by , C.J. at p. 58: ", "\"In my opinion, it is impossible to maintain an abstract proposition that is either legally or technically bound by previous decisions. Indeed, it may, in a proper case, be its duty to disregard them. But the rule should be applied with great caution, and -- only when. the previous decision is manifestly wrong, as, for instance, if it proceeded upon the mistaken assumption of the continuance of a repealed or expired Statute, or is contrary to a decision of another which this is bound to follow; not, I think, upon a mere suggestion that some or all of the mem- bers of the later might arrive at a different con- clusion if the matter was res integra. Otherwise there would be grave danger of want of continuity in the interpretation of law\". ", "In the same case , J. in the concluding paragraph of his judgment at p. 69 expressed himself thus: \"In conclusion, I would say that I never thought (1) L.R. 1944 X.B 718 C.A. ", "(3) 1939 A.C. 215, 245. ", "(2) 1898 A.C. 375. ", "(4) [1914] 18 C.L.R,. 54. ", "624 ", "that it was not open to this to review its previous decisions upon good cause. The question is not whether the can do so, but whether it will, baying due regard to the need for continuity and consistency in the judicial decision. Changes in the number of appointed Justices can, I take it, never of themselves furnish a reason for review. That the prior decision was that of little more than half their number might be urged with greater fairness, but it cannot be urged against 's case which was decided by ,the whole then in existence save the Justice who as President' of the Arbitration , was a party respondent to the order nisi. But the can always listen to argument as to whether it ought to review a particular decision, and the strongest reason for an overruling is that a decision is manifestly wrong and its continuance is injurious to the public interest\". ", "It is interesting to note that in that case all the Judges agreed that the decision in 's case was to be treated as open to review (Per , C. J. at p. 58) although in the end, after reviewing the position afresh in the light of new arguments advanced before it, the came to the same conclusion. v. ) may also be referred to as an instance where the High of Australia departed from its previous decision. ", "In the United States of America there have been a considerable number of cases in which has explicitly and avowedly overruled its prior decisions but there have been more instances in which the doctrines declared in prior cases have been in part evaded or 'modified without explicit repudiation. (Willoughby- Constitution of the United States, 2nd Edn., Vol. 1, pp. 74- ", "75). In State of Washington v. ), in his dissenting judgment said: ", "\"The doctrine Of stare decision should not deter us from overruling that case and those which follow it, (1) [1920] 28 C.L.R. 129. ", "(2) 264 U.S. 646; 68 L.Ed. 219. ", "625 ", "The decisions are recent ones. They have not been acquiesced in. They have not created a rule of property around which vested interests have clustered. They affect solely matters of a transitory nature. On the other hand, they affect seriously the lives of men, women and children, and the general welfare. Stare decisis is ordinarily a wise rule of action. But it is not a universal, inexorable command. The instances in which the have disregarded its admonition are many\". ", "In a foot-note to this judgment the learned Judge set out a large number of instances where the earlier decisions had been overruled. In another dissenting judgment in v. ) the same learned Judge, after quoting a passage from the judgment of Mr. Justice in v. Woodman(2) proceeded to say: \"Stare decisis is usually the wise policy, because in most matters it is more important that the applicable rule of law be settled right. Compare v. , 103 U.S. 99; 26 L.Ed. 443-444. This is commonly true even where the error is a matter of serious concern, provided correction can be bad by, legislation. But in cases involving the Federal Constitution, where correction through legislative action is practically impossible, this has often overruled its earlier decisions. The bows to the lessons of experience and the force of better reasoning recognising that the process of trial and error, so fruitful in the physical sciences, is appropriate also in the judicial function\". ", "In his separate but concurring judgment in v.- People of the State of New York(3) , observed: \"Judicial exegesis is unavoidable with reference to an act like our Constitution, drawn in many particulars with purposed vagueness so as to leave room for the unfolding future. But the ultimate touchstone of constitutionality is the Constitution itself and not (1) 285 U.S. 393; 76 L.Ed. 815. ", "(2) 218 U.S. 205, 212; 51 L.Ed. 1001, 1005. ", "(3) 306 U.S. 466; 83 L. Ed. 927. ", "626 ", "what we have said about it\". ", "In this case two previous - decisions were expressly overruled and two more were impliedly overruled. We now come to which, prior to the commencement of our Constitution, was the highest Court of Appeal to hear appeals from the Indian . In a case about Compensation to Civil Servants(1), in repelling the contention that the was bound in law, and without examination, to follow an earlier decision whether they considered it right or wrong the Marquess of Reading said: \"Their Lordships are unable to hold that this proposition stated in such an extreme form is established. It may well be said that the would hesitate long before disturbing a solemn decision by a previous which raised an identical or even ,a similar issue for determination;'but for the proposition that the is, in all circumstances, bound to 'follow a previous decision, as it were, blindfold, they are unable to discover any adequate authority. In other words, no inflexible rule, which falls in all circumstances to be applied has been laid down\". In the Attorney-General of Ontario v. (,) Viscount stated the practice of the in the following terms: ", "\"Their Lordships do not doubt that in tendering humble advice to His Majesty, they are not absolutely bound by previous decisions of the , as is by its own judgments. In ecclesiastical appeals, for instance on more than one occasion the has tendered advice contrary to that given in a previous case, which further historical research has shown to have been wrong. But on constitutional questions it must be seldom indeed that the would depart from a previous decision which it may be assumed will have been acted upon both by Governments and subjects\". ", "Finally, in (3) Lord said at p. 88: ", "(1) L.R. 1929 A.C. 242; A.I.R. 1929 P.C. 84, 87. (2) [1946] 50 C.W.N 535; A.I.R 1946 P.O. 88. (3) L.R. 76 I.A. 10; 1939 Dom. L.R. 87 (P.C). ", "627 ", "\"Their Lordships then have before them a decision upon facts which in no material respect differ from those of the present case. Even so, it is, as they recognise, competent for them humbly to tender advice to His Majesty inconsistent with a previous decision,, though it can only be in most exceptional circumstances. that such a course should be taken................ Recognising the possibility, they have beard full argument and, having done so, see no reason to doubt the validity of the reasoning or the correctness of the conclusion in 's case, and they do not think it necessary to repeat what was said there\". ", "In considering the applicability of the principles laid down in the decisions here in before mentioned, it should be borne in mind that the English decisions may well have been influenced by considerations which can no longer apply to the circumstances prevailing in India. The error, if any, of in England, may be corrected by or eventually by by a simple majority. The mistakes, if any, made by , if not corrected by itself in a subsequent case, could be set right by when appeals were taken there or by the appropriate legislative authority. An error made by or can easily be rectified by by a simple majority by an amending statute. But in a country governed by a federal constitution, such as the United States of America and the Union of India are, it is by no means easy to amend the Constitution if an erroneous interpretation is put upon it by this . (See article 368 of our Constitution). An erroneous interpretation of the Constitution' may quite conceivably be perpetuated or may at any rate remain unrectified for a considerable time to the great detriment to public well being. The considerations adverted to in the decisions of the Supreme of America quoted above are, therefore, apposite and apply in full force in determining whether a previous decision of this should or should not be disregarded or overruled. There is nothing in our Constitution which prevents us from departing from a previous decision if we are convinced of its error and its baneful effect on the general interests of the public. Article 141 which lays down that the law declared by this shall be binding on all s within the territory of India quite obviously refers to s other than this . The corresponding provision of the Government of India Act, 1935 also makes it clear that the s contemplated are the Subordinate s. ", "There are several circumstances relating to the majority decision of the in . (supra) to which reference must be made. That appeal was heard immediately before the hearing of the appeal reported as (1) commenced. The two appeals were, as a matter of fact, heard one after the other and judgments were reserved in both of them. The constitution of the was, however, different. In the first appeal one of the Judges of that Bench expressly differed from the majority decision and another learned Judge did not accept the majority decision on many points. In the second appeal one Judge of the Bench, who was not a party to the first appeal, differed from the majority decision in the first appeal. The result, therefore, was that the majority decision was definitely differed from by two Judges. has now in the judgment he has written in the present appeal which we have had the advantage of reading reconsidered the matter and on further reflection he thinks that the majority decision on the present issue was erroneous and he now agrees substantially with the view of article 286(1)(a ),read with the Explanation and article 286(2) which was expressed in the two minority judgments referred to above and which is adopted in the judgment now being delivered in the present appeal. If had then expressed the views he is now doing, then the majority in the Bombay appeal would have been 3 to 2 and if we add the opinion of the dissenting Judge in the ", "-Travancore-Cochin appeal then judicial opinion would (1) [1954] 5 S.C.R. 53. ", "629 ", "have been divided 3 to 3. In this juxtaposition it is difficult to give the majority decision in the Bombay appeal that amount of sanctity and reverence which is usually attributed to an unretracted majority decision of this Court. ", "The majority decision does not merely determine the rights of the two contending parties to the Bombay appeal. Its effect is far reaching as it affects the rights of all consuming public. It authorises the imposition and levying of a tax by the on an interpretation of a constitutional provision which appears to us to be unsupportable. To follow that interpretation will result in perpetuating what, with humility we say, is an error and in perpetuating a tax burden imposed on the people which, according to our considered opinion, is manifestly and wholly an authorised. It is not an ordinary pronouncement declaring the rights of two private individuals inter se. It involves an adjudication on the taxing power of the s as against the consuming public generally. If the decision is erroneous, as indeed we conceive it to be, we owe it to that public to protect them against the illegal tax burdens which the s are seeking to impose on the strength of that erroneous recent decision. The third circumstance is that there appears to be some vagueness, if not inconsistency, in the majority judgment itself. At p. 1084 of the authorised report the majority judgment says: ", "\"The expression 'for the purpose of consumption in that ' must, in our opinion, be understood as having reference not merely to the individual importer or purchaser but as contemplating distribution eventually to consumers in general within the . Thus all buyers within the of delivery from out-of- sellers, except those buying for re-export out of the ., would be within the scope of the Explanation and liable to be taxed by the on their inter- transactions\". ", "This passage seems to suggest that it is only the buyers falling within the Explanation who are liable to be taxed by what has been called in the discussion before us as the delivery State. According to this passage, read by itself, the out-of-State sellers are not considered liable to be taxed on the sales. The whole trend of the rest of the majority judgment and the actual decision therein run counter to this conclusion, for the out-of-State sellers were, by reason of the Explanation, subjected to the taxing power of the delivery State. Indeed, Bihar is claiming to tax the appellant company, an out-of-the-State seller, by virtue of the majority decision and all other States intervening and supporting Bihar read the judgment in that way and none of them accepts the quoted passage as containing the actual ratio deciding of the majority judgment. This confusion, we consider, is also a cogent reason for re-examining that decision. ", "Reference is made to the doctrine of finality of judicial decisions and it is pressed upon us that we should not reverse our previous decision except in cases where a material provision of law has been overlooked or where the decision has proceeded upon @the mistaken assumption of the continuance of a repealed or expired statute and that we should not differ from a previous decision merely because a contrary view appears to us to be preferable. It is need- less for us to say that we should not lightly dissent from a previous pronouncement of this . Our ;power of review, which undoubtedly exists, must be exercised with due care and caution and only for advancing the public well being in the light of the surrounding circumstances of each case brought to our notice but we do not consider it right to confine our power within rigidly fixed limits as suggested before us If on a re-examination of the question we come to the conclusion, as indeed we have, that the previous majority decision was plainly erroneous then it will be our duty to say so and not to perpetuate our mistake even when one learned Judge who was party to the previous decision considers it incorrect on further reflection. We should do so all the more readily as our decision is on a constitutional question and our erroneous decision has imposed illegal tax burden on the consuming public and has otherwise given rise to public inconvenience or hardship, for it is by no means easy to amend the Constitution. Sometimes frivolous attempts may be made to question our previous decisions but if the reasons on which our decisions are founded are sound they will by themselves be sufficient safeguard against such frivolous attempts. Further, the doctrine of stare decisis has hardly any application to an isolated and stray decision of the very recently made and not followed by a series of decisions based thereon. The problem before us does not involve overruling a series of decisions but only involves the question as to whether we should approve or disapprove, follow or overrule, a very recent previous decision as a precedent. In any case, the doctrine of stare decisis is not an inflexible rule of law and cannot be permitted to perpetuate our errors to the detriment to the general welfare of the public or a considerable section thereof It is pointed out that all the States are realising sales tax in respect of sales or purchases of goods where the goods are actually delivered for consumption within their respective boundaries on the faith of our previous decision and a reversal of that decision will upset the economy of the States and will indeed render them liable to refund moneys already collected by them as taxes. This circumstance, it is pressed upon us, should alone deter us from differing from the previous decision. We are not impressed by this argument. It has not yet been decided by this that moneys paid under a mutual mistake of law induced by a wrong judicial interpretation of a statute or the Constitution must necessarily be refundable as money had and received. If, as contended, moneys so paid are in law refundable the States cannot complain any more than a private individual in similar circumstances could do. Finally, if the State economy is upset the appeal must be to which under article 286(2) itself has ample power to make suitable legislation. ", "The impugned decision is a recent one. The judicial opinion was divided, if not evenly balanced. One of the four Judges who formed the majority has revised his opinion as stated above. The decision on the point noted above seems to be somewhat inconsistent and is, at any rate, not quite clear. It has encouraged the imposition of tax burdens on the consuming public on an interpretation of the Constitution which appears to us to be plainly erroneous. It has given rise to considerable inconvenience and hardship to business people who have not acquiesced in it by any means. To rectify the error by the legislative process is difficult, for a constitutional amendment requires a specified majority which may not always be available and if it involves an amendment of the legislative lists it will require the consent of a requisite number of the States which, in this instance, cannot reasonably be expected. In the premises, we think that it is precisely a case where, in the public interests, the meaning, scope and effect of article 286 should be re-examined afresh in the light of the fresh arguments now advanced before us and the experience we have since acquired. In our judgment the majority decision in . (supra) is, in the circumstances alluded to, open to review and we are entitled to re-examine article 286 in order to ascertain its true meaning, scope and effect so far as it is necessary for the purposes of this appeal and we proceed on this basis. ", "It is a sound rule of construction of a statute firmly established in England as far back as 1584 when 's case(1) was decided that- ", "\".................... for the sure and true interpretation of all Statutes in general (be they penal or beneficial, restrictive or enlarging of the common law) four things are to be discerned and considered:- ", "1st. What was the common law before the making of the Act., 2nd. What was the mischief and defect for which the common law did not provide., 3rd. What remedy the hath resolved and appointed to cure the disease of the Commonwealth., and (1) 3 Co. Rep. 7a; 76 ElR. 637, 4th. The true reason of the remedy; and then the office of all the judges is always to make such construction as shall suppress the mischief, and advance the remedy, and to suppress subtle inventions and evasions for continuance of the mischief, and pro privato commodo, and to add force and life to the cure and remedy, according to the true intent of the makers of the Act, pro bono publico\". ", "In In re ) Lindley, M.R. in 1898 found the rule \"as necessary now as it was when Lord reported Heydon's case\". In v. Comptroller General of Patents, Designs and Trade Marks(2) Earl of Halsbury re-affirmed the rule as follows: \"My Lords,, it appears to me that to construe the Statute in question, it is not only legitimate but highly convenient to refer both to the former Act and to the ascertained evils to which the former Act had given rise, and to the later Act which provided the remedy' These three being compared I cannot doubt the conclusion\". ", "It appears to us that this rule is equally applicable to the construction of article 286 of our Constitution. In order to properly interpret the provisions of that article it is, therefore, necessary to consider how the matter stood immediately before the Constitution came into force, what the mischief was for which the old law did not provide and the remedy which has been provided by the Constitution to cure that mischief. ", "The position with respect to taxation on sales or purchases of goods that prevailed in the country had better be stated in the language of , C. J. who delivered the majority judgment in the . (supra). After expressing the view, based on the authority of the Walk\" Brothers' Case(3) that in the case of sales tax, it was not necessary that the sale should take place within the territorial limits of the in the sense that all the ingredients of a sale, like the agree- ", "(1) L R. [1898] 2 Ch. 28, 35. (2) L.R [1898] A.C. 671, 576. (3) 1948 F.C.R. 1. ", "634 ", "ment to sell, the passing of title, delivery of the goods, etc., should have a territorial connection with the State and that, broadly speaking, local activities of buying and selling carried on in the State in relation to local goods would be a sufficient basis to sustain the taxing power of the State, provided of course that such activities ultimately resulted in a concluded sale to be taxed, the learned Chief Justice proceeded to say:- ", "\"In exercise of the legislative power conferred upon them in substantially similar terms by the Government of India Act, 1935, the Provincial Legislatures enacted Sales Tax laws for their respective Provinces, acting on the principle of territorial nexus referred to above; that is to say, they picked out one or more of the ingredients constituting a sale and made them the basis of their sales tax legislation. Assam and Bengal made, among other things, the actual existence of the goods in the Province at the time of the contract of sale the test of taxability. In Bihar the production or manufacture of the goods in the Province was made an additional ground. A net of the widest range perhaps was laid in the Central Provinces and Berar where it was sufficient if the goods were actually \"found\" in the Province at any time after the Contract of Sale or Purchase in respect thereof was made. Whether the territorial nexus put forward as the basis of the taxing power in each case would be sustained as sufficient was a matter of doubt not having been tested in a Court of law. And such claims to taxing power led to multiple taxation of the same transaction by Provinces and cumulation of the burden falling ultimately on the consuming public. This situation posed to the Constitution makers the problem of restricting the taxing power on sales or purchases involving elements, and alleviating the tax burden on the consumer. At the same time they were evidently anxious to maintain the State power of imposing non-discriminatory taxes on goods imported from other States, while upholding the economic unity of India by providing for the freedom of trade and commerce. ", "635 ", "In their attempt to harmonise and achieve these somewhat conflicting objectives, they enacted articles 286, 301 and 304\". ", "Leaving out, for the moment, the question as to whether articles 301 and 304 have any bearing on the question of construction of article 286 , as to which we entertain a contrary opinion, the above passage quite adequately depicts the picture of chaos and confusion that was brought about in or commerce by indiscriminate exercise of taxing power by the different founded on the theory of territorial nexus between the respective Provinces and the sales or purchases sought to be taxed. It was to cure this mischief of multiple taxation and to preserve the free flow of or commerce in the Union of India regarded as one economic unit without any provincial barrier that the Constitution makers adopted article 286 in the Constitution which runs as follows-- ", "\"286. (1) No law of a State shall impose, or authorise the imposition of, a tax on the sale or purchase of goods where such sale or purchase takes place ", "(a) outside the State; or ", "(b) in the course of the import of the goods into, or export of the goods out of, the territory of India. Explanation. -For the purposes of sub-clause (a), a sale or purchase shall be deemed to have taken place in the State in which the goods have actually been delivered as a direct result of such sale or purchase for the purpose of consumption in that State, notwithstanding the fact that 2under the general law relating to sale of goods the property in the goods has by reason of such sale or purchase passed in another State. ", "(2) Except in so far as may by law otherwise provide, no law of a State shall impose, or authorise the imposition of, a tax on the sale or purchase of any goods where such sale or purchase -takes place in the course of inter-State trade or commerce: ", "Provided that the President may by order direct that any tax on the sale or purchase of goods which was being lawfully levied by the Government of any St-ate immediately before the commencement of this Constitution shall, notwithstanding that the imposition of such tax is contrary to the provisions of this clause, continue to be levied until the thirty-first day of March, 1951. (3)No law made by the Legislature of a State imposing, or authorising the imposition of, a tax. on the sale or purchase of any such goods as have been declared by by law to be essential for the life of the community shall have effect unless it has been reserved for the consideration of the President and has received his assent\". ", "Article 286 is in Part XII of the Constitution which deals with \"Finance, Property, Contracts and Suits\". it is one of the several articles which are grouped under the heading \"Miscellaneous Financial Provisions\" in Chapter I of that Part. It is to be noted that it has not found a place in Part XI, Chapter I whereof deals with \"Legislative Relations\" including \"Distribution of Legislative Powers\" between and the s of s. The marginal note to article 286 is \"Restrictions.as to imposition of tax on the sale or purchase of goods\", which, unlike the marginal notes in Acts of the British , is part of the Constitution as passed by , prima facie, furnishes some clue as to the meaning and purpose of the article. Apart from the marginal note, the very language of that article makes it abundantly clear that its object is to place restrictions on the legislative power of the s with respect to the imposition of taxes on the -sales or purchases of goods. It will be recalled that section 100(3) of the Government of India Act, 1935 read with Entry 48 of List 11, of the Seventh Schedule to that Act gave power to the Provincial s to make laws with respect to \"Taxes on sale of goods and on advertisements\". Pursuant to the legislative power thus conferred on them the Provincial s enacted Sales Tax Act s for their respective Provinces. Although in most of those Acts 'Sale\" was, first defined a,% meaning transfer of the property in the goods, so as to make the passing of the property within the Province the principal basis, for the imposition of the tax, yet by means of Explanations to that definition, those Acts gave extended meanings to that word and thereby enlarged the scope of their operation. The imposition of tax on the sales or purchases of goods on the basis of a very slight territorial connection or nexus resulted in what has been graphically described by C.J. in the passage quoted above from the majority judgment in the Bombay appeal. This imposition of multiple taxes on one and the same transaction of sale or purchase was certainly calculated to hamper and discourage free flow of trade within India regarded as one economic unit. This undesirable state of affair is had to be put right. Therefore, while the Constitution makers by article 246(3) read with Entry 54 in List 11 of the Seventh Schedule to the Constitution conferred power on the s of Part A and Part B s to make law with respect to \"Taxes on the sale or purchase of goods other than newspapers\" they at the same time by article 286 clamped on that legislative power several fetters. Broadly speaking, the fetters thus placed on the taxing power of the s are that no law of a shall impose or authorise the imposition of a tax on the sale or purchase of goods where such sale or purchase takes place, (a) outside the or (b) in the course of import or export or (c) except in so far as otherwise provides, in the course of inter- trade or commerce and lastly (d) that no law made by the of a imposing or authorising the imposition of a tax on the sale or purchase of any such goods as have been declared by by law to be essential for the life of the community shall have effect unless it has been reserved for the consideration of the President and has received his assent. It should be noted that these are four separate and independent restrictions placed upon the legislative compe- tency of the s to make a law with respect to matters enumerated in Entry 54 of List II. In order to make the ban effective and to leave no loophole the Constitution makers have considered the different aspects of sales or purchases of goods and placed checks on the legislative power of the s at different angles. Thus in clause (1) (a) of article 286 the question of the situs of a sale or purchase engaged their attention and they forged a fetter on the basis of such situs to cure the mischief of multiple taxation by the s on the basis of the nexus- theory. In clause (1) (b) they considered sales or purchases from the point of view of our foreign trade and placed a ban on the s' taxing power in order to make our foreign trade free from any interference by the s by way of a tax impost. In clause (2) they looked at sales or purchases in their inter- character and imposed another ban in the interest of the freedom of internal trade. Finally, in clause (3) the Constitution makers' attention was riveted on the character and quality of the goods themselves and they placed a fourth restriction on the s' power of imposing. tax on sales or purchases of goods declared to be essential for the life of the community. These several bans may overlap in some cases but in their respective scope and operation they are separate and independent. They deal with different phases of a sale or purchase but, nevertheless, they are distinct and one has nothing to do with and is not dependent on the other or others. The s' legislative power ,with respect to a sale or purchase may be bit by one or more of these bans. Thus, take the case of a sale of goods declared by as essential by a seller in West Bengal to a purchaser in Bihar in which goods are actually delivered as a direct result of such sale for consumption in the of Bihar. A law made by West Bengal without the assent of the president taxing this sale will be unconstitutional because (1) it will offend article 286(1)(a) as the sale has taken place outside the territory by virtue of the Explanation to clause (1)(a), (2) it will also offend article 286(2) as the sale has taken place in the course of inter- trade or commerce. and (3) such law will also be contrary to article 286(3) as the goods are essential commodities and the President's assent to the law was not obtained as required by clause (3) of article 286. This appears to us to be the general scheme of that article. We come now to the particular bans. Although the s of the s were empowered by article 246(3) read with Entry 54 of List II to make a law with respect to taxes on sales or purchases of goods, the different s, as already mentioned, considered themselves free to make a law imposing tax on sales or purchases of goods provided they bad some territorial nexus with such sales or purchases, e.g., that one or other of the ingredients or events which go to make up a sale or purchase was found to exist or had happened within their respective territories. Whether they were right or wrong in. so acting is a question which has not been finally decided by the but the fact is that they did so. This resulted in multiple taxation which manifestly prejudiced the interests of the ultimate consumers and also hampered the free flow of inter- trade or commerce. So the Constitution makers had to cure that mischief. The first thing that they did was to take away the s' taxing power with respect to sales or purchases which took place outside their respective territories. This they did by clause (1)(a). If the matter had been left there, the solution would have been imperfect, for then the question as to which sale or purchase takes place outside a would yet have remained open. So the Constitution makers had to explain what an outside sale was and this they did by the Explanation set forth in clause (1). The language employed in framing the Explanation, how- ever, has given scope for argument to counsel and presented considerable difficulties to the in ascertaining its purpose and intendment. If the Explanation simply said \"For the purposes of subclause (a), a sale or purchase shall be deemed to have taken place outside a when the goods have actually been delivered for the purpose of consumption in another , notwithstanding the fact, etc., etc.)) then none of the difficulties would have arisen at all. But' why, it is asked did the Constitution makers seek to explain what was an outside sale or purchase by saying that a sale or purchase was to be deemed to take place inside the particular mentioned in the Explanation? Was the purpose of the Explanation only to explain what was an outside sale or purchase or was it also its purpose to allot or assign a particular class of sales or purchases of the. kind mentioned therein to a particular so as to put the question of situs of the sales or purchases of that description beyond the pale of controversy? These are questions which arise and are raised because of the somewhat involved language of the Explanation. Four different views as to the true meaning and effect of the Explanation have been suggested for our consideration and arguments have been advanced for and against the correctness of each of them. In the view we have taken, it is not necessary for us to express any final opinion in the matter. We propose accordingly to note the possible views and record very briefly the criticisms relating to each of those views and the suggested answers to such criticisms. ", "One view which has been called the strict view is this. In clause (1) (a) the Constitution makers have placed a ban on the taxing power of the s with respect to sales or purchases which take place outside the . If the matter had been left there the ban would have been imperfect, for the argument would have still remained as to where a particular sale or purchase took place. Does a sale or purchase take place at the place where the contract of sale is made, or where the property in the goods passes or where the goods are delivered? These questions are answered by the Explanation. That Explanation is \"for the purposes of sub-clause (a)\" i.e., for the purpose of explaining which sale or purchase is to be regarded as having taken place outside a . By saying that a particular sale or purchase is to be deemed to take place in a particular the Explanation only indicates that such sale or purchase has taken place outside all other s, The Explanation is neither an Exception nor a Proviso but only explains what is an outside sale-referred to in sub-clause (a). This it does by creating a fiction. That fiction is only for the purposes of sub-clause (a) and cannot be extended to any other purpose. It should be limited to its avowed purpose. To say that this Explanation confers legislative power on what for the sake of brevity has been called the delivery is to use it for a collateral purpose which is not permissible. Further, it is utterly illogical and untenable to say that article 286 which was introduced in the Constitution to place restrictions on the legislative powers of the s, by aside wind,, as it were, gave enlarged legislative powers to the of delivery by an explanation sandwiched between two restrictions. This construction runs counter to the entire scheme of the article and the explanation and one may see no justification for imputing such indirect and oblique purpose to this article. Had the Constitution makers so desired they could have done so in a more direct and straight-forward way. To hold that the Explanation has, besides its declared purpose, another hidden purpose of conferring or enlarging legislative power is to build up a fanciful argument merely on the unfelicitous and involved language used in the Explanation although it is distinctly not the purpose of the Explanation and although it does not purport substantively and proprio vigore, to confer any legislative power on any . Its only purpose is to explain what an outside sale is so that, by one stroke, as it were, it takes away the taxing power, in respect of sales or purchases of the kind referred to in the Explanation, of all s other than the where such sales or purchases are, by the Explanation, to be deemed to have taken place. This view of the Explanation was taken in the dissenting judgment in the case of the (supra). The view that the Explanation is only for the purposes of sub-clause (a) of clause (1) and cannot be carried over to clause (2) was also taken in the dissenting judgment in the . (supra) at p. 1103. ", "642 ", "The criticism that has been leveled against this strict view of the Explanation is that it will not entirely eliminate the claims of the States to tax sales or purchases on the basis of the nexus theory. Suppose, it is said, lifts the ban placed on inter-State trade or commerce by clause (2), all States will, in that situation, claim the right to tax sales or purchases if any one of the ingredients or events making up the sale is to be found to exist or to have happened in that State. It has been suggested in reply to this criticism that this apprehension is not at all well-founded. When will lift the ban imposed by clause (2), the Explanation will continue to operate, so that inter-State sales or purchases falling within it will still be deemed to have taken place in the delivery State and, therefore, outside all other States none of which latter States will, by reason of the ban imposed by clause (1) (a), be entitled to tax such sale. The ban under clause (2) being lifted the delivery 'State will become free to tax such sales or purchases in exercise of the taxing power conferred on it by article 246(3) read with Entry 54 in List II. Then, it is asked, what will happen to those sales or purchases which do not fall within the Explanation? After lifts the ban under clause (2) which State will tax sales or purchases in which goods are actually delivered in a particular State, not for consumption in that State but, say, for re-export to another State for consump- tion? One of the suggested answers was that those sales or purchases were not likely to be numerous, for ordinarily a dealer would not actually get the goods imported into a State only for re-exporting the same to another State for consumption in the last mentioned State but would find it more convenient and economical to arrange for the delivery of the goods straight to the last mentioned State. A further suggestion was that it might well be that when would by law lift the ban of clause (2) it would, by the same law, provide which of the States would tax such inter-State sales or purchases which were not covered by the Explanation and on what basis. ", "643 ", "This suggested answer, in its turn, raises a question as to the scope and ambit of the legislative power conferred on by clause (2). The opening words of clause (2), namely, \"Except in so far as may by law otherwise provide\" clearly indicate that the lifting of the ban may be total or partial, that is to say, may lift the ban wholly and unconditionally or it may lift it to such extent as it may think fit to do and on such terms as it pleases. It is to be remembered that under Entry 42 of List I alone may make law with respect to inter-State trade or commerce. It is, therefore, conceded that in exercise of its legislative powers under that entry read with article 286(2) may make a law permitting the States to tax interState sales or purchases of certain commodities only. It is also not questioned that may, by way of regulating inter-State trade or commerce, fix a ceiling rate of tax on sales or purchases of goods which the law made by the States under Entry 54 of List II, may not exceed. Can also override the Explanation? If not, cannot at least provide which of the States may tax inter-State sales or purchases of goods which do not fall within the Explanation? These are some of the questions which may arise as and when will choose to make a law in exercise of the powers conferred on it and it will then be time enough to discuss and decide those questions. It is not for the to advise in advance as to the scope of its legislative competency under clause (2) and, therefore, -we only note those questions and leave them here. ", "The second view as to the meaning and effect of the Explanation is that it once for all-fixes the situs of a sale or purchase so that one knows when such a sale or purchase is outside a and when it is inside a . To put it differently, are told when a sale or purchase is inside a particular and, therefore, the are also told when a sale or purchase is outside a . In short the Explanation not only explains what is an outside sale or purchase but also actually fixes the situs of a sale or purchase in a particular . This view of the Explanation was taken in the majority decision in the . (supra). The majority decision quite clearly concedes that the Explanation does not, by itself, confer any legislative power on any , not even the delivery , with respect to sales or purchases of the kind mentioned therein but as it fixes the situs of such sales or purchases in the delivery that is left free to tax them in exercise of its legislative powers under article 246 (3) read with Entry 54 of List 11. The criticism offered against this view is, first of all, that it uses the Explanation for a purpose which is beyond that of sub-clause ", "(a). This view turns the fiction created expressly for sub- clause (a) into a reality fixing the location of such sales and purchases for all purposes. In the next place this view ignores the existence of clause (2) which imposes a different ban on the legislative power of all s including the delivery also, so that as long as does not lift the ban no , not even the delivery , may tax sales or purchases which take place in the course of inter- trade or commerce, even though they may fall within the Explanation. The further objection is that this view also does not completely eliminate the confusion arising from the nexus theory. Suppose lifts the ban under clause (2), which will tax sales or purchases which do not come within the Explanation? The same answer was suggested as was done in reply to similar objections to the first view. That, as we have said, will call for decision if and when exercises its legislative powers under clause (2). ", "The third view, which was adumbrated and discussed in the separate judgment of Bhagwati, J. in the case of . (supra) is that the Explanation concerns itself with notionally fixing the situs of sales or purchases in the delivery State only but in no way affects the taxing power of the State in which, under the general law relating to the sale of goods, the property in the goods has passed. The result of this view is said to be that the State in which the sales or purchases are to be deemed to have taken place may tax them but the State in which, under the general law relating to the sale of goods, the property in the goods has passed may also tax them if and when lifts the ban of clause (2). This view, it is said, is open to all the criticisms to which the second view is subject and in addition to that a further objection has been suggested against this view, namely, that it will perpetuate double, if not multiple, taxation on one and the same transaction of sale or purchase at least after lifts the ban. ", "A fourth view has also been suggested before us as a possible view although it was not put forward on the previous occasion. It is founded on the non-obstante clause in the Explanation. It is said that clause (1) (a) and the Explanation concern themselves with only two s, namely the title , i.e., the in which, under the general law, title to the goods passes to the purchaser and the delivery , i.e., the in which goods are actually delivered as a direct result of the sale or purchase for consumption in that . The purpose of the Explanation is said to be to demarcate the taxing power of only these two s by taking out the sales or purchases of the kind mentioned therein from the sphere of the taxing power of the title and subjecting them to the taxing power of the delivery . In the juxtaposition of those two s clause (1) (a) read with the Explanation provides that the title cannot tax because such sales or purchases are, by the fiction, made to take place outside its territory and that the delivery can tax because the sales or purchases in question are, by the fiction, made to take place inside its territory. In short, the result of clause (1) (a) read with the Explanation, according to this view, is that the which cannot tax such sales or purchases on the ground that they have taken place outside its terri- tory is only that in which the property in the goods has passed. The criticism is immediately put forward.that if clause (1) (a) and the Explanation are limited in their operation only to the two s men- ", "646 ", "tioned above then the other States which also claimed to tax on the strength of the nexus theory, e.g the State where the contract was made, or the State where the goods were produced or manufactured or were found, will be outside the ban and the mischief of multiple taxation which the Constitution makers were out to curb will continue to be rampant and unabated. This view is also subjected to some of the other criticisms mentioned in connection with the other views of the Explanation. ", "As we have already stated, we do not desire, on this occasion, to express any opinion on the validity claimed for or the infirmities imputed to any of these several views, for, in our opinion, it is not necessary to do so for disposing of this appeal. Whichever view is taken of the explanation it should be limited to the purpose the Constitution makers bad in view when they incorporated it in clause (1). It is quite obvious that it created a legal fiction. Legal fictions are created only for some definite purpose. Here the avowed purpose of the Explanation is to explain what an outside sale referred to in sub-clause (a) is. The judicial decisions referred to in the dissenting judgment in (supra) at pp. 81 and 82 and the case of v. ) clearly indicate that a legal fiction is to be limited to the purpose for which it was created and should not be extended beyond that legitimate field. It should further be remembered that the dominant, if not the sole, purpose of article 286 is to place restrictions on the legislative powers of the States, subject to certain conditions in some cases and with that end in view article 286 imposes several bans on the taxing power of the States in relation to sales or purchases viewed from different angles and according to their different aspects. In some cases the ban is absolute as, for example, with regard to outside sales covered by clause (1) (a) read with the Explanation, or with regard to imports and exports covered by clause (1)(b) and in some cases it is con- (1) L.R. 1952 A.0. 109,132, ditional, e.g., in the cases of inter-State sales or pur- chases under clause (2) which is, in terms, made subject to the proviso thereto and also to the power of to lift the ban. Again, in some cases the bans may overlap but nevertheless, they are distinct and independent of each other. The operative provisions of the several parts of article 286 , namely, clause (1) (a), clause (1)(b), clause (2) and clause (3) are manifestly intended to deal with different topics and,, therefore., one cannot be projected or read into another. On a careful and anxious consideration of the matter in the light of the fresh arguments advanced and discussion,s held on the present occasion we are definitely of the opinion that the Explanation in clause (1) (a) cannot be legitimately extended to clause (2) either as an exception or as a proviso thereto or read as curtailing or limiting the ambit of clause (2). Indeed, in . (supra) at pp. 1083-1084 and again at p. 1086 the majority judgment also accepted the position that the Explanation was not an exception or proviso either to clause (1) (a) or to clause (2). If, therefore, the Explanation cannot be read into clause (2) because of the express language of the Explanation and also because of the difference in the subject-matter of the operative provisions of the two clauses, then it must follow that, except in so far as may by law provide otherwise, no State law can impose or authorise the imposition of any tax on sales or purchases when such sales or purchases take place in the course of inter-State trade or commerce and irrespective of whether such sales or purchases do or do not fall within the Explanation. It is not necessary, for the purposes of this appeal, to enter upon a discussion as to what is exactly meant by inter-State trade or commerce or by the phrase \"in the course of\", for it is common ground that the sales or purchases made by the appellant company which are sought to be taxed by the State of Bihar actually took place in the course of inter-State trade or commerce. not having by law otherwise provided, no State law can, therefore, tax these sales , or purchases, that is to say, Bihar cannot tax by reason of clause (2) although they fall within the' Explanation and other States cannot tax by reason of both clause (1) (a) read with the Explanation and clause (2). This conclusion leads us now to consider the arguments by which the respondent State and the intervening States which support the respondent State seek to get over this position. ", "In the forefront is placed the argument that found favour with the majority of the Bench which decided the case of . (supra). That argument is to be found in the majority judgment at pp. 1085-1086. Shortly put, the majority opinion was that the operation of clause (2) stood excluded as a result of the legal fiction enacted in the Explanation. In their view the effect of the Explanation in regard to inter- dealings was to invest what, in truth, was an inter- transaction with an intrastate character in relation to the of delivery and clause (2) could, therefore, have no application. They recognised that the legal fiction was to operate \"for the purposes of subclause (a) of clause (1)\" and that that meant merely that the Explanation was designed to explain the meaning of the expression \"outside the \" in clause (1) (a). They, nevertheless, came to the conclu- sion that when once it was determined with the aid of the fictional test that a particular sale or purchase had taken place within the taxing , it followed as a corollary, that the transaction lost its inter- character and fell outside the purview of clause (2), not because the fiction created by the Explanation was used for the purpose of clause (2), but because such sale or purchase became, in the eye of the law, a purely local transaction. In his own inimitable language the learned Chief Justice, who wrote and delivered the majority judgment, concluded the discussion on this point by saying that the statutory fiction completely masked the inter- character of the sale or purchase which, as a collateral result of such masking, fell outside the scope of clause (2). In spite of the great respect we always entertain for the opinions of the then learned Chief Justice and the other learned Judges who constituted the majority we are unable to accept the aforesaid arguments or the conclusions as correct for the reasons we now proceed to state. ", "The situs of an intangible concept like a sale can only be fixed nationally by the application of artificial rules invented either by Judges as part of the judgemade law of the land, or by some legislative authority. But as far as we know, no fixed rule of universal application has yet been definitely and finally evolved for determining this for all purposes. There are many conflicting theories: One, which is more popular and frequently put forward and is referred to and may, indeed, be urged to have been adopted by the Constitution in the non-obstante clause of the Explanation, favours the place where the property in the goods passes, another which is said to be the American view and which was adopted in (1) fixes upon the place where the contract is concluded, a third which prevails in the continental countries of Europe prefers the place where the goods sold are actually delivered, a fourth points to the place where the essential ingredients which go to make up a sale are most densely grouped. In this situation if the Explanation were not there and the ban under clause (2) were to be raised unconditionally it would become necessary for the to reach a conclusion and choose between these conflicting views. Article 286(1)(a ), it should be noted, does not say that inside sale may be taxed. It only says that no outside sale shall be taxed. Now if a claims that the sale is inside because part of its ingredients lies within its boundaries, by the same logic it is also an outside sale because the remaining parts are outside its territories and if it is an outside sale it cannot be taxed whether or not it can be deemed to be inside for some particular purpose. The prohibition of article 286(1) (a) is against taxing an outside sale and if the sale is outside even partially it may well be argued that no legislature can (1) A.I.R. 1953 Mad. 116. ", "650 ", "override the Constitution by deeming it to be an inside sale. Therefore, if the last of the aforesaid theories were to be adopted, then either no would be able to tax, or all having the requisite nexus would be able to do so. But this in our opinion, is the very mischief which the Constitution makers wished to avoid and that, as we understand the majority judgment in the Bombay case, was their view also. So that view can be placed on one side. On any one of the other views the would have to be fixed artificially in one place and then one would have to apply the logic of the majority decision and hold that as soon as the is determined to be in one place by judicial fiction, i.e., a fiction enunciated by judicial decision, the inter character of the transaction must cease. The majority hold that this is the result when the is placed in only one , namely, the delivery , because of the fiction which the Explanation creates. The same result would have to follow logically if the were to be established by judicial fiction instead of by a constitutional one. The reasoning of the majority, pushed to its logical conclusion, will inevitably lead us to hold that all inter- transactions must eventually be converted into intrastate transactions and, therefore, become amenable to the taxing power of the within whose territories they are, by the constitutional or judicial fiction, to be deemed to take place. In this view there will remain no inter- transaction on which clause (2) may possibly operate. The argument which leads to this astounding conclusion has only to be stated to be rejected. The truth is that what is an inter sale or purchase continues to be so irrespective of the where the sale is to be located either under the general law when it is finally determined what the general law is,or by the fiction created, by the Explanation. The of a sale or purchase is wholly irrelevant as regards its inter- character. We find no cogent reason in support of the argument that a fiction created for certain definitely expressed purposes, namely, the purposes of clause (1) (a) can legitimately be used for the entirely foreign and collateral purpose of destroying the inter- character of the transaction and converting it into an intra sale or purchase. Such metamorphosis appears to us to be beyond the purpose and purview of clause (1)(a) and the Explanation thereto. When we apply a fiction all we do is to assume that the situation created by the fiction is true. Therefore, the same consequences must flow from the fiction as would have flown had the facts supposed to be true been the actual facts from the start. Now, even when the of a sale or purchase is in fact inside a , with no essential ingredient taking place outside, nevertheless, if it takes place in the course of inter- trade or commerce, it will be hit by clause (2). If the sales or purchases are in the course of inter- trade or commerce the stream of inter- trade or commerce will catch up in its vortex all such sales or purchases which take place in its course wherever the of the sales or purchases may be. All that the Explanation does is to shift the from point A in the stream to point X also in the stream. It does not lift the sales or purchases out of the stream in those cases where they form part of the stream. The shift- ing of the of a sale or purchase from its actual under the general law to a fictional under the Explanation takes the sale or purchase out of the taxing power of all s other than the where the is fictionally fixed. That is all that clause (1) (a) and the Explanation do. Whether the delivery will be entitled to tax such a sale or purchase will depend on the other provisions of the Constitution. The assignment of a fictional to a sale or purchase has no bearing or effect on the other aspects of the sale or purchase, e.g., its inter- character or its export or import character which are entirely different topics. This fixing of a for a sale or purchase in any particular either under the general law or under the fiction does not conclude the matter. It has yet to be ascertained whether that sale or purchase which by virtue of the Explanation has taken place in the delivery was made in the course of inter- trade or commerce. For this purpose the Explanation can have no relevancy or application at all. ", "Another argument adumbrated in the majority judgment in . (supra) at p. 1081 and at pp. 1086-1087 and elaborated before us is that just as the freedom of trade referred to in article 301 has been made to give way to the States' power of imposing nondiscriminatory taxes by article 304 so must article 286(2) be regarded as subject to the States' taxing power, for the protection of article 286(2) could not have been intended to be larger. This argument was refuted by the dissenting judgment in that Bombay case (supra) at pp. 1102- 1103 and p. 1127 and also by the dissenting judgment in (supra) at p. 89. Nothing that we have heard on the present occasion induces us to depart from the views expressed on this subject in those dissenting judgments. It is next urged that the Explanation in effect operates as an exception or a proviso to clause (2). This view runs directly counter to the express language of the Explanation itself. So the argument is formulated in a slightly different way. It is said that clause (2) contains the enunciation of the general rule and the Explanation embodies a particular or special rule. According to a cardinal rule of construction the particular or special rule must control or cut down the general rule. This view was adopted by in the judgment under appeal and also found favour with one of the Judges in the Bombay case (supra). It appears to us that this argument overlooks the basic fact that clause (1) (a) to which is appended the Explanation and clause (2) deal with different topics altogether. The Explanation is concerned with explaining what is an outside sale or purchase by fixing a fictional situs. It cannot be read as a provision independent of clause (1) (a). It does not, by itself and in terms, confer any legislative power on any State. It is true that the Explanation may apply to fix the Situs Of many inter-State transactions but that is only for ascertaining, for the purposes of clause (1) (a), whether it has taken place in side or outside a particular State. The inter-State aspect of the sales or purchases is not within the purview of clause (1) (a) which looks at sales or purchases from the point of view of their location only. Clause (2), on the other hand, takes note of the inter-' State character of sales or purchases which is an entirely different topic. The two provisions do not relate to the same subject and, therefore, it is not possible to hold that one is the enunciation of a general rule and the other the enunciation of a particular or special rule on one and the same subject. The principle of construction relied upon cannot, in our opinion, be called in aid in construing clause (2) and the Explanation of clause (1)(a). If the Explanation cuts down clause (2), it must also, on a parity of reasoning, cut down clause (3) which, as will hereinafter be explained more fully, could not possibly have been intended by the Constitution makers. It must also cut down clause (1) (b) dealing with import and export; but to hold that would run counter to the decision in . (1). In our opinion to use the Explanation to cut down the operation of clause (2) or clause (3) will be to use it for a purpose other than its legitimate and avowed purpose. ", "The same argument is put in a slightly different way and in a more attractive form. It is said that we must construe article 286 as a whole and give meaning to every part of it. Sales or purchases which fall within the Explanation to clause (1) (a) clearly partake of the character of inter- State transactions. Therefore, if we construe clause (2) of article 286 literally and strictly then the whole of clause (1) (a) and the Explanation will be redundant and useless and will have no immediate operation and will remain a dead letter, at any rate, until , in exercise of its powers under clause (2), lifts the ban. We must, it is urged, make an attempt to avoid such a result and adopt such a construction as will not only give effect to each part of the article but also make each part (1) 8 S.C li. 1112. ", "654 ", "applicable in presenti. That, it is pointed out, can well be done if clause (2) is interpreted in a restricted manner. The argument runs-give full and immediate effect to the Explanation and then leave clause (2) to govern or operate on cases which do not fall within the Explanation. In effect this argument means that we must treat all transactions of sales or purchases falling within, the Explanation as outside clause (2). Shorn of its thin veneer of disguise this argument is nothing more than the argument that the Explanation, in effect, operates as an exception ,to clause (2) and all the criticisms applicable to that construction will apply mutatis mutandis to the argument in the present form. Apart from that there are obvious fallacies which render the argument utterly unacceptable. We now proceed to deal with these fallacies seriatim. ", "(i)In the first place, the mere circumstance that a provision in the Constitution will, on a proper con- struction, take effect on the happening of a future event can, by itself, be no ground for not giving effect to the plain language of that provision. Take the very next provision in article 286 itself, namely, clause (3). It has no present application and its usefulness will ensue only when by law declares certain goods to be essential for the life of the community. The fact that the Explanation, in so far as it relates to inter-State sales, may not have an immediate operation until lifts the ban under clause (2) need not unnecessarily oppress us or lead us to adopt a forced construction only to give the whole of it an immediate and present operation. ", "(ii)In the second place, it is not correct to say that the Explanation, construed as suggested above, can have no immediate operation at all. It certainly has immediate operation to render sales and purchases which fall within the explanation to be outside sales and purchases so as immediately to take away the taxing power of all States other than the delivery State with respect to them. Further cases may arise in which purchases or sales which are outside clause (2) may, nevertheless, fall within and be immediately governed by the Explanation. We do not wish to express any opinion on hypothetical cases but the following illustration will show that on a given view of the law the Explanation would be called into play despite the fact that clause (2) was not attracted. Take, for instance, a case where both the seller and the buyer reside and carry on business in Gurgaon in the State of Punjab. Let us say that the seller has a godown in the State of Delhi where his goods are stored and that the buyer has also a retail shop at Connaught Circus also in the State of Delhi. The buyer and the seller enter into a contract at Gurgaon for the sale of certain goods and a term of the contract is that the goods contracted to be sold will be actually delivered from the seller's godown to the buyer's retail shop, both in the State of Delhi, for consumption in the State of Delhi. Pursuant to this contract made in Gurgaon in the State of Punjab, the buyer pays the full price of the goods at Gurgaon and the seller hands over to the buyer also at Gurgaon a delivery order addressed to the seller's godown- keeper in Delhi to deliver the goods to the buyer's retail shop. As a direct result of this sale the seller's godown- keeper, on the presentation of this delivery order, actually delivers the goods to the buyer's retail shop at Connaught Circus for consumption in the State of Delhi. On one view of the law, the situs of such a sale would be Gurgaon. We need not decide that it is, because that type of case is not before us and there may be other views to consider, but it is certainly a possible view. It is also possible to hold that this is not inter-State trade or commerce, because there is no movement of goods across a State boundary. Again, we need not decide that because that also may be controversial. But given these two postulates the transaction would fall squarely within the Explanation and yet it would not come within clause (2) for there is no movement of the goods across the border of any State and both the seller and the buyer are in the same place. Surely, the Explanation will, in presenti, govern such cases irrespective of whether has lifted the ban under clause (2). If these postulates are accepted then by virtue of clause (1) (a) read with the Explanation the State of Delhi alone will be entitled to impose a tax on such a sale or purchase and the State of Punjab will be precluded from doing so by reason of the fictional situs assigned to such a sale or purchase by the Explanation, although the contract was made, price was paid and symbolical or constructive delivery of the goods by the handing over of the delivery order took place in Gurgaon in the State of Punjab. ", "(iii)It is not correct to say that clause (1) (a) read with the Explanation is wholly useless. It may well be argued that there was scope for the operation of clause (1)(a) and the Explanation as and when the President exercised the powers vested in him by the Proviso to clause (2). It will be noticed that under that proviso the President's order was to take effect \"notwithstanding that the imposition of such tax is contrary to the provisions of this clause\". This non obstante clause does not, in terms, supersede clause (1) at all and, therefore, prima -facie, the President's order was subject to the prohibition of clause (1)(a) read with the Explanation. It is, however, pointed out that the proviso says that any tax which was being lawfully levied by the States immediately before the commencement of the Constitution will continue to be levied until the date therein specified. It is said that before the Constitution sales tax was levied by the different States on the basis of the nexus theory irrespective of the situs of the sales or purchases and, therefore, this very proviso clearly indicates that the intention of the Constitution makers was that all taxes imposed on the basis of the nexus theory must continue irrespective of the provisions of the Explanation which fictionally fixes the situs of the sales or purchases in the delivery State. The argument is not without some force but cannot prevail. It is true that the different States used to levy sales tax on the basis of slight nexus but the legality of them had not, at the date of the Constitution, been tested in a Court of law. Therefore, the proviso authorised the President by order to continue only such of them as were being \"lawfully\" levied and consequently there is no reason to think that the President's order was intended to continue all sales taxes previously levied irrespective of their legality. In the next place, there is nothing to be surprised at if the President's order was made to operate subject to the prohibition of clause (1) (a) read with the Explanation. Finally, to accede to this argument must mean that we must read into the proviso something which is not there. To give effect to this argument we shall have to alter the non obstante clause towards the end of the proviso and substitute the words \"of the foregoing clauses\" for the words \"of this clause\". However, we need not rest our decision on this point. It will certainly operate as soon as , in exercise of the power vested in it by clause (2), lifts the ban imposed on the States. Upon the lifting of the ban by those inter-State sales or purchases which fall within the Explanation will, by virtue of it, be deemed to take place within the deli-very State and such sales or purchases being, as a result of such fiction, outside all other States none of them will be entitled to tax such sales or purchases. Whether the delivery State will be entitled to make a law imposing tax on such sales or purchases in exercise of the legislative powers vested in it by article 246 (3) read with Entry 54 in List II or whether , while lifting the ban, may also by the same law authorise the delivery State to do so or what is the extent of the authority vested in by the opening words of clause (2) are questions which will arise for consideration only after the ban under clause (2) is lifted and we need not in advance express any opinion on a future problem. ", "(iv) If we accept the argument that we are to give full effect to clause (1) (a) and the Explanation and let it operate immediately on all transactions which come within their terms and leave clause (2) to govern only those cases which are outside clause (1) (a) read with the Explanation then, on a parity of reasoning, we shall have to give effect to clause (1) (a) and the Explanation and leave clause (1) ", "(b) and 'also clause (3) to govern only those cases which do not fall within clause (1)(a) read with the Explanation. To illustrate this point, take clause (3). Suppose under clause (3) by law declares certain goods, say wheat, to be essential for the life of the community. Suppose there is a sale of such essential goods by a seller in the State of Delhi to a buyer in Gurgaon in the State of Punjab in which as a direct result of such sale the 'goods are delivered in Gurgaon in Punjab for consumption in that State. According to the argument we have to give full effect first to clause (1) (a) and the Explanation and accordingly we must hold that the transaction is wholly covered by the Explanation and, therefore, Punjab will be entitled to tax it and clause (3) must be left to govern only cases other than those which fall within the Explanation. If the argument were sound it must follow that the State of Punjab will be perfectly justified in saying that for the purpose of making a law imposing a tax on such sales or purchases its law need not be reserved for the assent of the President at all. It may well say that the restrictive requirements of reserving the bill for the President's assent and of obtaining such assent before the law may take effect apply only to a law which imposes tax on sales or purchases which are outside the Explanation. In other words, the State of Punjab, in our illustration, will be entitled to say that clause (3) governs only those cases of sales or purchases of essential goods which do not come within the description mentioned in the Explanation, namely, for instance, only those sales or purchases in which es- sential goods are delivered in a State not for consumption in that State but for re-export to another State. This will rob clause (3) of practically the best part of its content and, therefore, of its usefulness and defeat the very purpose the Constitution makers obviously had of safeguarding sales or purchases of essential commodities by imposing the restriction requiring the reservation of the bill for the President's assent and the obtaining of such assent. When a famine is raging in say Punjab, and sales and purchases are made of wheat which is declared as essential to the life of the community and as a direct result of such sale wheat is delivered in the Punjab for consumption there the State of Punjab may, according to the reasoning underlying the argument, put up the price of these essential goods by imposing a sales tax by making a law to that effect and ignoring the safeguards prescribed by clause (3). An argument which leads us to a result so utterly absurd and untenable in reason cannot for a moment be countenanced. No less than five reasons have been suggested in support of the argument that a restricted construction should be placed on clause (2) of article 286. It will be convenient to deal with them at this stage one by one. ", "(a) In the first place, it is urged that clause (2) should be construed in a restricted way because the class of sales falling within article 286(1) (a) forms a special class of inter-State sales and they cannot be affected by the general provisions of article 286(2). This argument totally overlooks the real scheme of article 286. It fails to note that by this article the Constitution makers were imposing restrictions on the taxing power of the States with respect to sales or purchases in their different aspects viewed from entirely different angles which we have heretofore already explained. The subject-matters of the different parts of article 286 are, therefore, different and distinct and the principle of interpretation, namely, the special provision cutting down the general provision cannot be properly invoked. ", "(b)The second reason urged is that if article 286(2) applies to the class of sales or purchases falling within article 286(1)(a) then it will result in discrimination against local trade and in favour of interState trade and this will be inconsistent with the provisions of Part XIII of the Constitution. It is said that when a Bihar dealer sells certain goods to a Bihar purchaser the former is obliged to pay sales tax which he passes on to the Bihar purchaser but when the Bihar purchaser directly imports into Bihar similar goods from say a West Bengal dealer for consump- ", "84 ", "660 ", "tion in Bihar that transaction will not the liable to Bihar Sales Tax as it will be an transaction. This, it is said, will prejudice the Bihar seller for all Bihar purchasers will then be driven to purchasing goods from out- of-State sellers and local producers will suffer a set back. The argument is that as a literal construction of clause (2) will result in such discrimination against local trade, the cardinal rule of interpretation, namely, reading the written provision literally and giving to the words their ordinary natural meaning should give way to a restricted con- struction. This argument overlooks several basic things. If there is any real hardship of the kind referred to, there is which is expressly invested with the power of lifting the ban under clause (2) either wholly or to the extent it thinks fit to do. Why should the be called upon to discard the cardinal rule of interpretation for mitigating a hardship, which after all may be entirely fanciful, when the Constitution itself has expressly provided for another authority more competent to evaluate the correct position to do the needful? This argument also fails to take into account the benefit which the consuming public derives from the free flow of goods from one State to another resulting in lower prices. Further, the argument overlooks the fact that the so-called hardship, if any, is brought about, not really by reason of the liberal construction of clause (2) but by reason of the State of Bihar imposing a sales tax on an intrastate transaction. The State of Bihar is not obliged to levy a sales tax on - sales or purchases of goods in respect of which there is competition between out-of-State producers, manufacturers and dealers and the Bihar producers, manufacturers and 'dealers and, indeed, if it intends to encourage its local manufacturers or producers it should not do so. It will not do for the State of Bihar to say that it must levy a sales tax on intrastate sales or purchases which it is not obliged to do and at the same time that it must protect the Bihar dealers or producers, and enable them to compete with outside dealers or producers and, therefore, ask us to construe the Constitution in an unnatural way so as to enable it to have the best of both worlds. It is immediately retorted that the welfare State must have sufficient revenue to run itself, that if it is to forego sales tax its economy will be totally upset. This harrowing picture of economic collapse of the States has been pressed upon this on this as on the previous occasion and it evidently oppressed the minds of the Judges who were parties to the majority decision. It is, therefore, necessary to examine the matter a little more closely. Ordinarily, trade or commerce is done between a dealer in one State and a dealer in another State. The dealer in the consuming State in his turn sells the goods in retail to actual *consumers. There can be no objection to insisting upon all inside dealers getting them selves registered and submitting returns showing goods imported and sold by them and bringing their annual turnovers to tax which they will pass on to the actual consumers. Call it a purchase tax vis-a-vis the earlier transaction under which the goods were delivered in Bihar for consumption in that State or call it a sales tax vis-a-vis the subsequent local sales by the Bihar dealer to actual consumers in Bihar, the State will get the full revenue on these local sales or purchases from the local sellers. There can be no doubt that sales or purchases of this kind to or from one dealer to another dealer actually form the bulk of trade or commerce. To take them out of clause (2) will be to make the protection of trade or commerce wholly illusory and to rob clause (2) of the best part of its content and utility. Ordinarily individual local consumers buy goods in the local market and do not generally bring goods for their personal consumption from outside dealers. It is only in exceptional cases that a local consumer will be energetic enough to bring goods from outside the State for his consumption and their number will be small. It is only those stray individual consumers who are energetic enough to get goods direct from a dealer in another State and may be willing to pay freight, etc., and undertake the risk of loss or damage who may evade the tax. The difficulty in tracing such stray actual local consumers cannot be any cogent reason for adopting the unnatural construction sought to be put upon clause (2) of article 286. If big Bihar purchasers, e.g., , who are very heavy consumers of coal, prefer to get their supply of coal from Ranigunge coal fields in West Bengal for consumption in their large factories at Tatanagar in Bihar to getting their supplies from the Jharia coal fields in Bihar and thereby evade sales tax to the detriment of the revenues of the State of Bihar, then again there is to mitigate such hardship by making suitable laws in exercise of its power under article 286(21. Such supposed hardship is, in our view, no ground for putting a forced and unnatural interpretation upon article ", "286. ", "(c) The third reason in support of a restricted construction of article 286(2) is thus formulated: The purpose of article 286 being to eliminate multiple taxation and article 286(1) (a) having already achieved that purpose with regard to the class falling within the Explanation, it was no longer necessary for that purpose to apply article 286(2) to that class. This reasoning appears to us to be untenable. It overlooks the patent fact that the different parts of the article look upon sales and purchases from different perspectives and place different bans on the taxing power of the States at different angles. The circumstance that the bans may in given cases overlap is no justification for concluding that the subject-matter of the different provisions is the same. This line of reasoning assumes that the only purpose of article 286 is to eliminate multiple taxation. The purposes of the different parts of the article have to be ascertained from the language of the article itself read in the light of the contemporary history of the legislative activities of the different States with respect to taxes on sales or purchases of goods and the chaos and confusion that arose and the havoc that ensued as a result of those activities. There was multiple taxation which imposed a heavy burden on the consumers and which was also calculated to impede and hinder the free flow of inter- ", "663 ", "State trade or commerce. The Constitution makers., therefore, imposed several bans on the taxing power of the States with respect to sales or purchases, namely, first on the basis of their situs, secondly and thirdly on the basis of the character of the transactions, e.g., foreign trade or inter-State trade and fourthly on the basis of the nature or quality of the goods sold or purchased, i.e., whether they have been declared to be essential to the life of the community. As regards inter-State trade or commerce the clear intention of the Constitution makers was to place an absolute ban for the time being, subject to the proviso, and to give some time to to study the situation and to evaluate the result of the ban and to lift the ban to such extent as it thought fit in the interest of the general public and that of interState trade or commerce. If the matter is approached in this way it becomes abundantly clear that this part of the argument we are now considering proceeds on a wrong assumption of the purpose of the Constitution. ", "(d)A restricted construction of article 286(2) is said to be necessary and called for because the Constitution itself has divided inter-State sales or purchases into two categories and in regard to one class it has itself provided both as to which State will tax them and under what condition and in regard to the other class the Constitution has imposed a ban in general terms and granted power to in general terms to relax such ban as thinks fit. This is clearly begging the question and does not require any elaborate refutation. ", "(e)Another string to the bow is that because of the legal fiction created by the Explanation the inter-State sales or purchases were converted into intraState transactions. This, it will be recalled, was the reasoning adopted in the majority decision in . (supra). We are unable to accept this argument for the reasons given above which Deed not be repeated here. ", "It is said that the picture of harassment and inconvenience to the traders referred to in the dissenting judgments is more imaginary than real. It is pointed out that it is only big traders who will have sales of their goods in all the States in the Union of India. Those big traders maintain a large staff of clerks and accountants and there can be no difficulty if they are obliged to file returns in each State where they sell their goods. This argument overlooks the practical effects of the different sales tax laws enacted by different States. All big traders will have to get themselves registered in each State, study the Sales Tax Act s of each State, conform to the requirements of all State laws which are by no means uniform and, finally, may be simultaneously called upon to produce their books of account in support of their returns before the officers of each State. Anybody who has any practical experience of the working of the sales tax laws of the different States knows how long books are detained by the officers of each State during assessment proceedings. There are different stages of these proceedings, original, appellate and revisional and there will be as many proceedings under each heading as there are States where the goods are sold. The harassment to traders is quite obvious and needs no exaggeration. On the other hand - if any risk to the economy of the States ensues from the construction of article 286 which commends itself to us, the appeal must be to which can by law made under the opening words of clause (2) mitigate that risk. ", "For all the foregoing reasons we are definitely of opinion that, until by law made in exercise of the powers vested in it by clause (2) provides otherwise, no can impose or authorise the imposition of any tax on sales or purchases of goods when such sales or purchases take place in the course of inter- trade or commerce and the ma- jority decision in . (supra) in so far as it decides to the contrary cannot be accepted as well founded on principle or authority. ", "In the view we have taken on question (A) it is not necessary for us, on this occasion, to discuss the other questions (B), (C) or (D). All that remains to be seen is whether as a result of our finding on question (A) the Bihar Sales Tax Act , 1947 is ultra vires and void in its entirety or it is only bad in so far as it seeks to impose a sales tax on out-of-State sellers in respect of sales or purchases. This will depend on whether the objectionable parts of the Act are severable from the rest of its provisions. It will be necessary here to refer to a few provisions of the Act. ", "The long title of the Act is \" An Act to provide for the levy of a tax on sales of goods in Bihar\". The preamble recites that \"It is necessary to make an addition to the revenues of Bihar and for that purpose to impose a tax on the sale of goods in Bihar\". The Act extends to the whole of the State of Bihar. \"Dealer\" was originally defined in section 2(c) as meaning: ", "\"any person who sells or supplies any goods in Bihar whether for commission, remuneration or otherwise and includes any firm or a Hindu joint family and any society, club or association which sells or supplies goods to its members\" ' By the Bihar Finance Act, 1950 the words \"in Bihar\" were omitted from this definition. Clause (g) of the same section defines sale. That definition has undergone various changes from time to time. The period we are concerned with in this appeal is from 26th January 1950 to the 30th September 1951. Between 1st October 1948 and 31st March 1951 which covers the earlier part of the relevant period the clause stood as follows:- ", "\"Sale\" means., with all its grammatical variations and cognate expressions, any transfer of property in goods for cash or deferred payment or other valuable consideration, including a transfer of property in goods involved in the execution of contract but does not include a mortgage, hypothecation, charge or pledge: ", "Provided that a transfer of goods on hire-purchase or other installment system of payment shall, notwithstanding the fact that the seller retains a title to any goods as security for payment of the price, be deemed to be a sale: ", "Provided further that notwithstanding anything to the contrary in the Indian Sale of Goods Act , 1930 (III) of 1930), the sale of any goods-- ", "(i)which are actually in Bihar at the time when, in respect thereof, the contract of sale as defined in section 4 of that Act is made, or ", "(ii)which are produced or manufactured in Bihar by the producer or manufacturer thereof, shall, wherever the delivery or contract of sale is made, be deemed for the purposes of this Act to have taken place in Bihar: Provided further that the sale of goods in respect of a forward contract, whether goods under such contract are actually delivered or not, shall be deemed to have taken place on the date originally agreed upon for delivery\". This definition was amended and between the 1st April 1951 and the 31st March 1952 which covers the latter part of the relevant period it read as follows: ", "\" sale\" means,, with all its grammatical variations and cognate expressions, any transfer of property in goods for cash or deferred payment or other valuable consideration, including a transfer of property in goods involved in the execution of contract but does not include a mortgage, hypothecation, charge or pledge: ", "Provided that a transfer of goods on hire purchase or other installment system of payment shall, notwithstanding the fact that the seller retains a title to any goods as security for payment of the price, be deemed to be a sale: Provided further that the sale of goods in respect of a forward contract, whether goods under such contract are actually delivered or not, shall be deemed to have taken place on the date originally agreed upon for delivery- Explanation.-The sale of any goods actually delivered in Bihar as a direct result of such sale for the purpose of consumption in Bihar shall be deemed for the purpose of this Act to have taken place in Bihar., notwithstanding the fact that under the general law relating to sale of goods, the property in the goods has, by reason of such sale, passed in another State\". It will be noted that the Explanation which is sub- stantially a reproduction of the Explanation to article 286(1) (a) was introduced for the first time by this amendment. ", "\"Turn over\" is defined in section 2(1) . The charging section is section 4 which provides, amongst other things, that subject to -the provisions of sections 5 , 6 , 7 and 8 and with effect from the commencement of the Act every dealer whose gross turn over during the year immediately preceding the date of such commencement on sales which have taken place both in and outside Bihar exceeds Rs. 10,000 shall be liable to pay tax under this Act on sales which have taken place in Bihar and from the date of such commencement. It will be noticed that although the long title and the preamble refer to the sale of goods in Bihar the words \"in Bihar\" were deleted from the definition of the word \"sale\" in section 2(g) . There are various provisions for working out the scheme of the Act to which no detailed reference need be made. It may, however, be pointed out that a new section was inserted by the Adaptation of Laws (Third Amendment) Order, 1951 which substantially reproduced the provisions of article 286(1) and (2). Although, therefore, the charging section read with the definition of \"dealer\" and \"sale\" may be wide enough to cover inter-State sales, the new section 33 makes all those provisions subject to its provisions which are nothing but a reproduction of the corresponding provisions of article 286. In view of the interpretation we have put upon article 286 it must follow that the charging section of the Act read with the relevant definitions cannot operate to tax inter-State sales or purchases and it must be held that as has not otherwise provided, the Act, in so far as it purports to tax sales or purchases that take place in the course of inter- State trade or commerce, is unconstitutional, illegal and void. This being the position the question arises whether the Act is bad ?In toto or is bad only in so far as it offends the provisions of article 286 as construed above. It appears to us that the Act imposes tax on subjects divisible in their nature but does not exclude in express terms subjects exempted by the Constitution. In such a situation the Act need not be declared wholly ultra vires and void, for it is feasible to separate taxes levied on authorised subjects from those levied on exempted subjects and to exclude the latter in the assessment of the tax. In these circumstances it is difficult to say that the scheme of taxing interState sales forms such an integral part of the entire scheme of taxation on sales or purchases of goods as to be inextricably interwoven with it. There is no reason to presume that had known that the provisions of the Act might be held bad in so far as they imposed or authorised the imposition of a tax on inter- State trade or commerce even though had not by law provided otherwise it would, nevertheless, not have passed the rest of the Act. ", "The result, therefore, is that this appeal must be allowed and we issue an order directing that, until by law provides otherwise, the of Bihar do forbear and abstain from imposing sales tax on out-of- dealers in respect of sales or purchases that have taken place in the course of inter- trade or commerce even though the goods have been delivered as a direct result of such sales or purchases for consumption in Bihar. The must pay the costs of the appellant in this -Court and in the Court below. The interveners must bear and pay their own costs. with the reasoning and the conclusions reached in the judgment just delivered by my Brother . In so I far however as I was a party to the judgment in (1) it is but proper that I should record my reasons for doing so. ", "(1) [1953] S.C.R 1069. ", "669 ", "The is a company incorporated under the Indian Companies Act having its registered office at No. 153, Dharamtala Street, Calcutta and laboratory and factory at Baranagar in the District of 24 Parganas in West Bengal and carrying on business of manufacturing and selling various sera, vaccines, biological products and medicines, etc., in Calcutta. The has extensive sales of its products throughout the whole of and the goods are despatched by the from Calcutta by rail, steamer or air against orders accepted at Calcutta and all sales take place within the State of West Bengal. The has no offices, agents, managers, godowns or laboratories in the State of Bihar. It is not a resident of Bihar nor has a place of business in Bihar and does not enter into any transaction of sale within the State of Bihar. On the 24th October 1951 the Assistant Superintendent of , headquarters Patna, wrote to the to get itself registered under the Bihar Sales Tax Act and to take necessary steps to deposit the Bihar Sales Tax dues in any Bihar treasury at an early date, contending that all sales in West Bengal in which the goods had been delivered in the State of Bihar as a direct result of the sale for the purpose of consumption in Bihar were leviable to Bihar Sales Tax with effect from the 26th January 1950. The denied the right of the State of Bihar to tax the sales effected in West Bengal and by his letter dated the 18th December 1951 the Superintendent of , Central Circle, Bihar sent a notice under section 13(5) of the Bihar Sales Tax Act to the calling upon it to apply for registration and to submit the return, showing its turn-over for the period from the 26th January 1950 to the 30th September 1951. ", "Correspondence thereafter ensued in which both the parties made futile attempts to convince each other of the legality of the stand taken by it. The Appellant asserted that it was not liable to assessment under the Bihar Sales Tax Act and denied the authority of the State of Bihar to levy sales tax upon the Appellant. The Assistant Superintendent of , Central Circle, Bihar, ultimately by his letter dated the 28th May 1952 rejected the contention of the Appellant and asked it to comply with the notice under section 13(5) of the Bihar Sales Tax Act failing which he threatened to proceed to take steps for assessment to the best of his judgment. The Appellant thereupon by its letter dated the 7th June 1952 called upon the Superintendent of , Central Circle, Bihar to forthwith rescind and cancel the notice issued under section 13(5) of the Bihar Sales Tax Act as the said notice was ultra vires of the Constitution and also the Bihar Sales Tax Act and was entirely illegal and inoperative. ", "As the aforesaid demand was not complied with the Appellant filed in at Patna a petition under article 226 of the Constitution asking for appropriate reliefs by way of issue of a writ of mandamus, certiorari and prohibition and any other appropriate writs or orders quashing the proceedings issued for the purpose of levying and realising a tax which was not lawfully leviable on the Appellant and asking the Appellant to file a return and register itself as a dealer. The State of Bihar, Respondent 1, The Superintendent of Commercial Taxes, Central Circle, Patna, Respondent 2 and Assistant Superintendent of Commercial Taxes, Central Circle, Bihar, Respondent 3 were the opposite parties to the petition. They did not file any affidavit in reply. The facts alleged by the Appellant were not denied but arguments on questions of law arising out of the petition were addressed by the Government Pleader appearing for them before . held: ", "(1) That the Respondent 3 was acting within his jurisdiction in issuing the notice under section 13(5) and holding that the applicant was liable to pay the tax, that if he made an assessment under section 13 (5) the Act provided a right of appeal whereby any error of law might be corrected by the Appellate authorities prescribed under the Act, that sections 24 and 25 of the Act furnished a complete and effec- ", "671 ", "tive machinery for appeal and revision against assessments made under the Act and that there was therefore no warrant for issuing a writ under article 226 of the Constitution; (2) That the phrase \"sale or purchase in the, course of inter-State trade or commerce\" in article 286 (2) must be construed so as to exclude the particular class of sales or purchases described in the explanation to article 296(1) and that therefore the amended clauses (c) and (g) of section 2 and section 33 of the Bihar Sales Tax Act were not in conflict with article 286(2); ", "(3) That the Bihar Sales Tax Act was in pith and substance not a law with respect to sale of goods but a law imposing tax on the sale of goods and the legislation fell entirely within Item 54 of List II of the Seventh Schedule to the Constitution, viz., taxes on the sale or purchase of goods other than newspapers and that the Act could not therefore be said to be invalid under article 254; ", "(4) That the Bihar Sales Tax Act had been enacted for the purpose of imposing tax on the sale of goods and not for regulating inter-State or intrastate trade and commerce and that therefore the Act did not contravene in any way article 304; and (5) That the Act was also not invalid on the ground that it was extra-territorial in operation, that the jurisdiction to tax existed not only in regard to persons or property but also as regards the business done within the State, that it was not necessary for the purposes of jurisdiction that the entire transaction of sale should have taken place within the territories, that on the other hand the fact that the goods ,were delivered in Bihar for consumption constituted sufficient nexus or territorial connection which conferred jurisdiction upon the Bihar legislature to impose the tax and that the explanation to article 286(1)(a) expressly conferred upon the State power to tax sales or purchases of goods which were actually delivered for consumption inside the State. ", " therefore dismissed. the petition with costs. ", "672 ", "The Appellant applied for leave to appeal to this Court and granted the requisite certificate under article 132(1) of the Constitution. ", "At the hearing of the appeal before us , , Calcutta, the State of Madras, the State of Mysore, the State of Uttar Pradesh, the State of Orissa, the State of Pepsu, the State of Rajasthan, the State of Madhya Pradesh, the State of Travancore-Cochin, the State of East Punjab and one applied for and were granted leave to intervene and counsel for the Interveners appeared before us and urged their respective points of view. ", "The first question as regards the maintainability of a petition for writ under article 226 on the facts disclosed in the petition can be disposed of very shortly in the words of , C. J. in (1) where he repelled a similar contention urged by the Advocate-General of the State of Madhya Pradesh:- ", "\"The learned Advocate-General of the ........ however contended that on the principle enunciated by in (2), jurisdiction to question assessment otherwise than by use of the machinery expressly provided by the Act, was inconsistent with the statutory obligation to pay, arising by virtue of the assessment and that the liability to pay the sales tax under the Act is a special liability created by the Act itself which at the same time gives a special and particular remedy which ought to be resorted to, and therefore the remedy by a writ ought not to be allowed to be used for evading the provisions of the Act, especially a fiscal Act............................ In our opinion the contentions raised by the learned Advocate-General are not well founded. It is plain that the evinced an intention that it could certainly proceed to apply the penal provisions of the Act against the appellant if it failed- to make the return or to meet the demand (1) S.C.R. 1122, 1126. ", "(2) 74 I.A. 50 and in order to escape from such serious consequences threatened without authority of law, and infringing fundamental rights, relief by way of a writ of mandamus was clearly the appropriate relief (1), it was held by this Court that a licence fee on a bussiness not only takes away the property of the licensee but also operates as a restriction on his fundamental right to carry on his business and therefore if the imposition of a licence fee is without authority of law it can be challenged by way of an application under article 32 , a fortiori also under article 226. These observations have apposite application to the circumstances of the present case. Explanation 11 to section 2(g) of the Act having been declared ultra vires, any imposition of sales tax on the appellant in Madhya Pradesh is without the authority of law, and that being so a threat by the State by using the coercive machinery of the Impugned Act to realize it from the appellant is a sufficient infringement of his fundamental right under article 19(1) (g) and it was clearly entitled to relief under article 226 of the Constitution. The contention that because remedy under the impugned Act was available to the appellant it was disentitled to relief under article 226 stands negatived by the decision of this Court in .(2), above referred to. There it was held that the principle that a court will not issue a prerogative writ when an adequate alternative remedy was available could not apply where a party came to the court with an allegation that his fundamental right had been infringed and sought relief under article 226. Moreover, the remedy provided by the Act is of an onerous and burdensome character. Before the appellant can avail of it he has to deposit the whole amount of the tax. Such a provision can hardly be described as an adequate alternative remedy\". ", "This sufficiently disposes of that contention and I am of the opinion that was in error when it held that there was no warrant for issuing a writ (1) [1952] S.C.R. 572. ", "(2) [1953] B.C.R. 1069, under article 226 of the Constitution on the facts disclosed in the appellant's petition. ", "On the merits appearing for the appellant urged:- ", "(1)That article 286 put a fetter on and the explanation did not confer any power on any to levy any taxes but was meant to explain only clause 1(a), i.e.\"what was an outside sale or purchase and that it did not remove -any restrictions or fetters and did not convert any inter-State sale or purchase into an intrastate or local or domestic transaction; (2)That article 286(2) in Part XII was meant to implement the supremacy of with regard to inter-State trade or commerce and it put an embargo on the power of to levy any tax on sale or purchase with respect to interState trade or commerce and that it was only when the embargo was lifted by appropriate ary legislation that could levy any tax on sales or purchases in the course of inter-State trade or commerce; and (3)That legislative competence of a was derived from article 246 read with the lists of the Seventh Schedule to the Constitution, that under article 245(2) only was given the power to enact legislation with extra-territorial operation and the s had no such power, and that the combined effect of article 246(3) and article 245 read with Item 54 of List II was that the was only competent to make laws imposing tax on sale or purchase of goods for the whole or part of that State. ", "The determination of these questions involves a construction of the provisions of article 286(1) and (2) of the Constitution and their true scope and effect. These provisions read as follows:- ", "\" Article 286. (1) No law of a State shall impose, or authorise the imposition of, a tax on the sale or purchase of goods where such sale or purchase takes place- ", "(a) outside the State; or ", "(b) in the course of the import of the goods into, or export of the goods out of, the territory of India. Explanation.-For the purposes of sub-clause (a), a sale or purchase shall be deemed to have taken place in the State in which the goods have actually been delivered as a direct result of such sale or purchase for the purpose of consumption in that State, not withstanding the fact that under the general law relating to sale of goods the property in the goods has by reason of such sale or purchase passed in another State. ", "(2) Except in so far as may by law otherwise provide, no law of a State shall impose, or authorise the imposition of, a tax on the sale or purchase of any goods where such sale or purchase takes place in the course of inter-State trade or commerce: ", "Provided that the President may by order direct that any tax on the sale or purchase of goods which was being lawfully levied by the Government of any State immediately before the commencement of this Constitution shall. notwithstanding that the imposition of such tax is contrary to the provisions of this clause., continue to be levied until the thirty-first day of March, 1951\". ", "They are enacted in Part XII of the Constitution which relates to finance, property, contracts and suits and fall under the caption of 'Miscellaneous Financial Provisions'. Their main purpose is to lay down the restrictions on Legislatures to enact laws imposing or authorising the imposition of tax on the sale or purchase of goods. Article 286(1) lays down such restrictions where such sale or purchase takes place-(a) outside the , or (b) in the course of the import of the goods into, or export of the goods out of, the territory of India. Article 286(2) lays down such restrictions where such sale or purchase takes place in the course of inter- trade or commerce. Article 286(1) is hedged in with the explanation and article 286(2) is hedged in with the exception \"in so far as may by law otherwise provide\" and the proviso under which the President might direct that any tax which was being lawfully levied by the Government of any immediately before the commencement of the Constitution may, notwithstanding the provisions of article 286(2 ), continue to be levied until the 31st March 1951. Except for these special dispensations the restrictions laid down by article 286(1) and (2) prevail and the true scope and extent of these restrictions would have to be culled out of the terms in which these provisions, are couched. ", "These provisions came to be considered by this Court in two cases, (1) and Another 'v. and others(1) and (2) (2). The first of these cases was concerned with the constitutionality of the Bombay Sales Tax Act XXIV of 1952. had declared the Bombay Sales Tax Act, 1952 ultra vires and had issued a writ in the nature of mandamus against the State of Bombay and the Collector of Sales Tax, Bombay, directing them to forbear and desist from enforcing the provisions of the said Act against the respondents. The main ground of attack in had been that the Act purported to tax sales and purchases of goods regardless of restrictions imposed on the State legislative power by article 286 of the Constitution and in that connection the provisions of article 286(1) and (2) came to be considered by this Court.The majority judgment of this Court delivered by , C. with which , and , concurred held that article 286 (1) (a) of the Constitution read with the explanation thereto and con- strued in the light of articles 301 and 304 prohibits the taxation of sales or purchases involving interState elements by all States except the State in which the goods are delivered for the purpose of consumption therein. The latter State is left free to tax such sales or purchases, and it derives this power not by virtue of article 28611 ) but under article 246(3) read with Entry 54 of List II. The majority judgment (1) S.C.R. 1069. (2) S.C.R. 53. ", "677 ", "differed from the view which was taken by me that the Explanation does not deprive the in which the property in the goods passed of this taxing power and that consequently both the in which the property in the goods passes and the in which the goods are delivered for consumption. have the power to tax and characterised it as not correct. The majority judgment also held that clause (2) of article 286 does not affect the power of the in which the delivery of goods is made to tax inter- sales or purchases of the kind mentioned in the Explanation to clause (1). The effect of the Explanation is that such transactions are saved from the ban imposed by article 286(2). , and myself agreed that article 286(2) could not be construed in the light of article 304(1) as the two articles dealt with different matters. , however held that the basic idea underlying article 286 is to prohibit taxation in the case of inter- trade and commerce until the ban under clause (2) of the said article is lifted by and always in the case of imports and exports. When the ban is lifted, the Explanation to clause (1) of article 286 comes into play to determine the situs of the sale. This Explanation does not govern clause (2) of article 286 and as it can only apply to transactions which in truth and in fact take place in the course of inter- trade and commerce, there is no need to call it in aid until the ban is removed. The majority judgment as well as , recognised that the provisions of article 286(1) and (2) had been enacted in order to prevent multiple taxation which used to be levied by the s before the commencement of the Constitution having resort to the nexus theory. They however did not discard that theory altogether and' were of the opinion that it was sufficient to invest the Legislature with jurisdiction to impose a tax on sale or purchase of goods, if any of the essential ingredients of sale had taken place within its territory. The did not accept the transfer of ownership in the goods or the passing of property therein as the sole criterion determining the situs of the sale and thus investing the within whose territories the sale had thus taken place as the only entitled to impose the tax on sale or purchase of goods. I however held that under the general law relating to sale of goods a sale must be regarded as having taken place in the in which the property in the goods sold has passed to the purchaser, and that is entitled to tax the sale or purchase as having taken place inside the . The Explanation to article 286(1) does not take away the right which the in which the property in the goods passed has to tax the sale or purchase but only deems such purchase or sale, by a legal fiction, to have taken place in the in which the delivery of the goods has been made for consumption therein so as to enable the latter also, to tax the sale or purchase in question. The Explanation only lifts the ban imposed by clause (1) (a) on taxation of sales or purchases which take place outside the , to the extent of the transactions mentioned in the Explanation to enable the delivery also to tax them. I also held that the general provision enacted in article 286(2) against the imposition of tax on the sale or purchase of goods in the course of inter- trade or commerce should give way to the special provision which is enacted in the Explanation to article 286(1) (a) enabling the delivery to tax such sale or purchase in the limited class of oases covered by the Explanation, the transactions covered by the Explanation being thus lifted out of the category of transactions in the course of inter- trade or commerce and assimilated to transactions of sale or purchase which take place inside the and thus invested with the character of an intrastate sale or purchase so far as the delivery is concerned. There was thus a divergence between the learned Judges as regards the true scope and effect of the Explanation to article 286(1) (a) read with article 286(2) and even though the same conclusion was reached by the majority Judges and myself we reached the same on different grounds. The interpretation put on article 286(1)(a) read with the Explanation thereto there- fore was that the delivery is left free to tax such, sales or purchases as fall within the terms of the Ex- planation and article 286(2) does not affect the power of such a to tax inter- trade or commerce of the kind mentioned in the Explanation. The Explanation saves such transactions from the ban imposed by article 286(2). It may be noted that though there was a consensus of opinion that article 286(1) was designed to avoid the multiple taxation of a sale or purchase by various s having resort to the nexus theory there was divergence of opinion as regards the real purpose of the Explanation as also the construction of the non-obstante clause and the true concept of consumption as embodied therein. According to the majority view the Explanation explained what is an outside sale by defining what is an inside sale. , was of the opinion that the purpose of the Explanation is to explain what is not outside the and therefore what is inside. I was of the view that what is otherwise a sale or purchase which takes place outside the is deemed to have taken place inside the delivery and the only purpose of the Explanation is to introduce a legal fiction whereby the delivery is also entitled to tax the transaction of sale or purchase along with the in which the transfer of ownership has taken place or the pro- perty in the goods has passed. The non-obstante clause also was differently interpreted. I took the the view that the non-obstante clause is incorporated in the Explanation to state what according to the Constitution makers is the basic idea of fixing the situs or the location of the sale or purchase in the place where the transfer of ownership takes place or the property in the goods passes and to indicate that notwithstanding that fact a sale or purchase which falls within the category mentioned in the Explanation is nevertheless to be deemed to have taken place inside the delivery . The majority judgment stated that the non- obstante clause is inserted in the Explanation simply with a view to make it clear beyond all possible doubt that it is, immaterial where the property in the goods passes as it might otherwise be regarded as indicative of the place of sale. , stated that the object of the Explanation is to fix the location of a sale or purchase by means of a fiction, but he disagreed with the view expressed by me that the non- obstante clause enunciates the general law on this point. He stated that there was no general law which fixed the situs of a sale, not even the Sale of Goods Act , that what the general law does is to determine the place where the property passes in the absence of a special agreement, but the place where the property passes is not necessarily the place where the sale takes place, nor has that ever been regarded as the determining factor. As regards the concept of consumption the majority were of the view that it should be understood as having reference not merely to the individual importer or purchaser but as contemplating distribution eventually to consumers in general within the . , construed that word to mean the usual use made of an article for the purposes of trade and commerce. I adopted the Dictionary meaning of the term and held that the Explanation covers only those cases where as a direct result of the sale or purchase goods are delivered for consumption in the delivery by the consumer and it is only that limited class of transactions which are covered by the Explanation and which are liable to tax by the delivery . I did not accept the contention that the words \"for the purpose of consumption\" must be accepted in a comprehensive sense as having reference to immediate as well as ultimate consumption within the and excluding only resales out of the . ", "In regard to article 286(2) all the Judges were agreed that transactions of sale or purchase in the course of inter- State trade or commerce are within the restriction and no State can tax such transactions, except in the two excepted cases, viz., (1) except in so far as may by law otherwise provide and (2) provided that the President may by order direct that any tax on sale or purchase of goods which was being levied by the Government of any State immediately before the commencement of the Constitu- ", "681 ", "tion shall continue to be levied until the 31st March 195 1. The Explanation to article 286 (1) (a) though it is specifically stated to be for the purposes of subclause (a) was construed by me as an exception or proviso to article 286(2 ), thus enabling the delivery to tax the transactions of sale or purchase taking place in the course of inter- trade or commerce. The majority Judges differed from this view and held that the Explanation converts the inter transaction into an intra- one and therefore there is no scope at all for the operation of article 286(2) in cases covered by the Explanation. , J. was of the view that the article 286(2) bans the delivery also from taxing such transactions, because if the transactions were in the course of inter- trade or commerce the Explanation merely shifts the point from A to B but this shifting is of no consequence at all, because both the points are caught in the vortex of inter- trade and commerce. It is only when the otherwise provides or the President gives the directions within the meaning of the proviso that this ban is lifted and the Explanation is there to settle a matter of considerable controversy regarding the situs of a sale. The argument that on this construction being put on the Explanation to article 286(1) and on article 286(2) the Explanation would become nugatory though accepted by me was rejected by , J. by pointing out that once the by law otherwise provided or the President by order gave the direction within the meaning of the proviso the Explanation would come into operation and would determine the situs of the sale thus enabling the appropriate to impose a tax on such transaction of sale or purchase. ", "The second case concerned itself with the construction of article 286(1) (b) in connection with the Sales Tax levied by the of Travancore-Cochin upon certain dealers in cashew nuts within its territory under the provisions of the Travancore-Cochin General Sales Tax Act, 1124 M.E. (Act No. XVIII of 1124 M.E.) and the question for the consideration of the was whether certain sales and purchases could be said to be in the course of the import of the goods into or the export of the goods out of the territory of India. The High had put a very wide construction on the words of article 286(1)(b) and held that the clause is not restricted to the point of time at which goods are imported into or exported from India and the series of transactions which necessarily precede export or succeed import of goods will come within the purview of this clause. There was a divergence of opinion between , C.J., J., , J. and , J. on the one side and J. on the other so far as the construction of the words \"in the course of\" was concerned. But apart from this construction of article 286(1) (b) J. who was not a party to the earlier decision hereinbefore referred to put on record his views on the construction of article 286(1)(a ), the Explanation thereto and article 286(2) expressing his disagreement with the interpretation which the majority judgment in that case bad put up on the same. He agreed that purporting to act under Entry 48 in List II of the Seventh Schedule to the Government of India Act, 1935, bad enacted the Sales Tax Act s imposing tax on sales or purchases of goods on the basis of one or more of the ingredients of sale having some connection with the Province and that this practice had resulted in the imposition of multiple taxes on a single transaction of sale or purchase thereby raising the price of the commodity concerned to the serious detriment to the consumer, that this evil had to be curbed and that is what has been done by clause (1)(a) of article 286. He however was of the opinion that in imposing the ban that no law of a shall impose or authorise the imposition of a tax on the sale or purchase where such sale or purchase takes place outside the , the Constitution proceeds on the footing that a sale or purchase has a location or situs. He further held that the non-obstante clause in the Explanation also clearly implies that the framers of the Constitution adopted the view that a sale or purchase has a situs and further that it ordinarily takes place at the place where the property in the goods passes. In effect, therefore, the Constitution, by this Explanation to clause (1) (a), acknowledges that under the general law the sale or purchase of the kind therein mentioned may not really take place in the delivery , but nevertheless requires it to be treated as if it did. That is to say, the Explanation creates a legal fiction. So far he agreed with me, but he differed from me in holding that the only effect of this assignment of a fictional location to a,particular kind of sale or purchase in a particular is to attract the ban of clause (1) (a) and to take away the taxing power of all other s in relation to such a sale or purchase even though the other ingredients which go towards the making up of a sale or purchase are to be found within these s or even if under the general law the property in the goods passes in any of those s. The purpose of the Explanation ends there and cannot be stretched or extended beyond that purpose. He therefore held that the effect of clause (1) (a) read in the light of the Explanation is not to permit both s, viz., the where the property passes under the general law as well as the in which, by force. of the Explanation, the sale or purchase is deemed to take place, to tax such sale or purchase, because in that event it will stultify the very purpose of that clause and it will fail to prevent the imposition of multiple taxes which it is obviously designed to prevent. In his opinion clause (1)(a) in terms only takes away the taxing power of all s with respect to a sale or purchase which, by reason of the fiction introduced by the Explanation, is to be deemed to take place outside their respective territories and the purpose of the Explanation is only to explain the scope of clause (1) (a) The Explanation is neither an exception nor a proviso. It is not its purpose nor does it purport, substantively and proprio vigore, to confer any power on any , not even on the delivery , to impose any tax. Whether the delivery can tax the sale or purchase of the kind mentioned in the Explanation will depend on other provisions of the Constitution. Neither clause (1) (a) nor the Explanation has any bearing on that question. So far as the -purpose and design of clause (2) are concerned he was of the opinion that clause (2) places yet another ban on the taxing power of the under Entry 54 read with article 246(3 ), in addition to the ban imposed by clause (1) (a). A sale or purchase contemplated by the Explanation to clause (1) (a) undoubtedly partakes of the nature of a sale or purchase made in the course of inter- trade and, therefore, no , whether it is the in which the property in the goods passes under the general law or the where the goods are delivered as mentioned in the Explanation, can impose a tax on such sale or purchase, unless and until lifts this ban. He differed from the view taken by me that the Explanation to article 286(1) (a) must be regarded not only as having authorised the delivery to impose the tax on the sale or purchase covered by the Explanation, but having also exempted it from the ban imposed by clause (2). He also differed from the majority view that what was an inter- transaction within the ban of article 286 (2) is converted into an intrastate or local or domestic transaction by virtue of the Explanation to article 286(1) (a). He saw no warrant for the argument that the fiction embodied in the Explanation for this definitely expressed purpose, can be legitimately used for the entirely foreign purpose of destroying the inter- character of the transaction and converting it into an intrastate sale or purchase for all purposes. Such metamorphosis is completely beyond the purpose and purview of clause (1) (a) and the Explanation thereto. ", "After expressing himself as above, he made the following observations which are very apposite to the appeal before us:- ", "\"To accede to this argument will mean that the Sales Tax officer of the delivery State will have jurisdiction to call upon dealers outside that State to submit returns of their turn over in respect of goods delivered by them to dealers in that State under transactions of sale made by them with dealers within that State. Thus a dealer in, say, Pepsu who delivers goods to a dealer in, say, Travancore-Cochin will become subject to the jurisdiction of the last mentioned State and will have to file returns of their turn over and support the same by producing their books of account there. I cannot imagine that our Constitution makers intended to produce this anomalous result. On the contrary, it appears to me that they enacted clauses (1) (a) and (2) for the very purpose of preventing this anomaly. I repeat that it is not permissible, on principle or on authority, to extend the fiction of the Explanation beyond its immediate and avowed purpose which I have explained above. In my judgment, until otherwise provides, all sales or purchases which take place in the course of inter-State trade or commerce are, by clause (2) of article 286 , made immune from taxation by the law of any State, irrespective of the place where the sales or purchases way take place, either under the general law or by virtue of the fiction introduced by the Explanation to clause (1)(a). If a particular inter-State sale or purchase takes place outside a State, either under the general law or by virtue of the fiction created by the Explanation, it is exempted from taxation by the law of that State both under clause (1) (a) and clause (2). If such inter-State sale or purchase takes place within a particular State, either under the general law or by reason of the Explanation, it is still exempt from taxation even by the law of that State under clause (2), just as a sale or purchase which takes place within a State, either under the general law or by reason of the Explanation, cannot be taxed by the law of that State if such sale or purchase takes place in the course of import or export within the meaning of clause (1) (b) \". ", "It may be observed that the contentions urged before us by the Appellant are in conformity with the above observations of , J. ", "Normally speaking the construction put by the majority judgment on the article 286(1 ), the Explanation thereto and article 286(2) of the Constitution in the Bombay Sales Tax appeal would be the law bind- ", "686 ", "ing on all parties and in the judgment just referred to in the Travancore-Cochin Sales Tax Appeal , 'J. rightly expressed that decision to be binding on him so long as it stands. The Appellant has however sought to urge before us that that decision was erroneous and has attempted to persuade us to reconsider the same and put a construction on article 286(1)(a ), the Explanation thereto and article 286(2) which is different from that adopted by the majority Judges in the Bombay Sales Tax Appeal. ", "The question therefore arises whether we are en,titled to reconsider that decision. ", " in England has always considered itself bound by its previous decisions. These decisions, as distinguished from the opinions which are delivered by as advice to the , are pronounced in the form of judgments and are binding on the as precedents. The question whether the bad the power to reconsider the previous decisions of its own and if it thought the decisions wrong to overrule ,or depart from them in subsequent cases was considered in v. ). Earl of Halsbury, L.C. who delivered the judgment of the observed at page 379:- ", "\"A decision of this once given upon a point of law is conclusive upon this afterwards, and that it is impossible to raise that question again as if it was res integra and could be reargued, and so the be asked to reverse its own decision. That is a principle which has been, I believe, without any real decision to the contrary, established now for some centuries, and I am therefore of opinion that in this case it is not competent for us to rehear and for counsel to reargue a question which has been recently decided\". ", "The reason of the rule was thus stated at page 380-\" \"Of course I do not deny that cases of individual hardship may arise, and there may be a current of opinion in the profession that such and such a judgment was erroneous; but- what is that occasional (1) [1896] Appeal Cases 375, interference with what is perhaps abstract justice as compared with the inconvenience-the disastrous in- convenience-of having each question subject to being reargued and the dealings of mankind rendered c ,doubtful by reason of different decisions, so that in truth and in fact there would be no real final Court of T, Appeal? My Lords, \"interest rei publicae.\" that there should be \"finis litium\" at some time, and there could be no \"finis litium\" if it were possible to suggest in each case that it might be reargued, because it is \"not an ordinary case,\" whatever they may mean\". and the conclusion was thus recorded at page 381:- ", "\"Under these circumstances it appears to me that your Lordships would do well to act upon that which has been universally assumed in the profession, so far as I know, to be the principle, namely, that a decision of this upon a question of law is conclusive, and that nothing but an Act of Parliament can set right that which is alleged to be wrong in a judgment of this \". ", " on the other hand has held that it is free to differ from its own decisions or from those of . The power of to reconsider its own decisions was discussed in In re Compensation to Civil Servants(1). In that case an earlier decision of the in Wigg v. Attorney-General of ) was attempted to be reviewed and after discussing the case-law on the point the came to the conclusion that is not bound in law and without examination to follow the decision in a prior appeal whether they considered it to be right or wrong although would hesitate long before disturbing a solemn decision by a previous , which raised an identical or even a similar issue for determination. While laying down this principle the discussed the earlier cases and in particular the case of v. Clifton(3) which was followed in v. Power(4) and v. of Lincoln(5) and the proposition was thus laid (1) A.I.B. 1929 P.C. 84. (2) 1928 P.C. 239. ", "(3) (1877] 2 P.D. 276. (4) [1891] A.C. 284. ", "(5)[18921 A.C. 644. ", "688 ", "down in the last mentioned case:- ", "\"In the present case their Lordships cannot but adopt the view expressed in v. Clifton(1) as to the effect of previous decisions. Whilst fully sensible of the weight to be attached to such decisions, their Lordships are at the same time bound to examine the reasons upon which the decisions rest, and to give effect to their own view of the law\". ", "The same principle was reiterated by in Attorney-General of Ontario and Others V. Canada Temperance Federation and Others(2). The was there concerned with the consideration of a constitutional question. An earlier decision of the in Russell V. Reg(3) had upheld the validity of the impugned statute. That decision bad stood unreversed for 63 years and had moreover received express approval of the in subsequent cases between 1883 and 1937. It was contended that the case had been wrongly decided and ought to be overruled and their Lordships repelled that contention:- ", "\"Their Lordships do not doubt that in tendering humble advice to His Majesty they are not absolutely bound by previous decisions of the , as is by its own judgments. In ecclesiastical appeals, for instance, on more than one occasion, the has tendered advice contrary to that given in a previous case, which further historical research has shown to have been wrong. But on constitutional questions it must be seldom indeed that the would depart from a previous decision which it may be assumed will have been acted upon both by governments and subjects, In the present case the decision now sought to be overruled has stood for over sixty years; the Act has been put into operation for varying periods in many places in the Dominion; under its provisions businesses must have been closed, fines and imprisonments for breaches of the Act have been imposed and suffered. Time and again the occasion has arisen when the could have overruled the decision had it thought it wrong. Accordingly, in (1) [18T7] 2 P.D. 276. (2) A.I.R. 1946 P.C. 88. (3) [1862] 7 A.C. 829, the opinion of their Lordships, the decision must be regarded as firmly embedded in the constitutional law of Canada and it is impossible now to depart from it\". It is therefore settled law so far as England is concerned that their Lordships of do' not consider themselves bound in law and without examination to follow their decision in a prior appeal whether they consider it to be right or wrong but feel themselves bound to examine the reasons upon which the decisions rest and to give effect to their own view of the law. We here are the highest Court of the land and would derive considerable assistance from the practice of set out above. is the highest Court of Appeal in the Commonwealth and concerns itself ,inter alia with deciding constitutional questions. The question whether it is bound by its previous decisions came up for consideration in the Tramways Case (No. 1)(1) and held that it was not bound by its previous decision but would only review a previous decision when that decision was manifestly wrong. , C.J. in this connection made the following observations at page 58:- ", "\"In my opinion it is impossible to maintain as an abstract proposition that the is 'either legally or technically bound by previous decisions. Indeed, it may in a proper case be its duty to disregard them. But the rule should be applied with great caution, and only when the previous decision is manifestly wrong........ Otherwise there would be grave danger of a want of continuity in the interpretation of the law\". ", ", J. observed at page 69:- ", "\"In conclusion, I would say that have never thought that it was not open to this to review its previous decisions upon good cause. The question is not whether the can do so, but whether it will, having due regard to the need for continuity and consistency in judicial decisions. Changes in the number of appointed Justices can, I take it, never of (1) 18 C.L.R. 51. ", "690 ", "themselves furnish a reason for review. That the prior decision was that of little more than half their number might be urged with greater fairness, but it cannot be urged against an earlier case........ But the can always listen to argument as to whether it ought to review a particular decision, and the strongest reason for an overruling is that a decision is manifestly wrong, and its maintenance is injurious to the public interest\". , J. at page 86 referred to an earlier decision given by him in the case of v. ", "\"I am at all times prepared to consider the review of any decision of this , by a Full Bench called to consider that question, and to reverse any decision if it is shown to be clearly wrong, subject to the well known considerations to be applied to the particular case in question at the time, according to the well known judicial policy of British, Australian -and American s, and I think of all s of Appeal in English-speaking communities\"-except \"I decline even to consider a question of reversing a decision of this casually, or even seriously, raised by counsel, not clearly urgent, and not raised before as full a bench as is available. If we do not show some respect to our own 's decisions, no counsel will feel safe in advising the public, and it will create uncertainty and confusion......... 'Under those circumstances I think it would have to be shown that the decision was clearly wrong, and, as it has been followed by this in other cases, that it would be in the interests of the public to reverse it\". ", "This question came for consideration again by in v. and Others(2) and the majority judgment stated at p. 142:- ", "\"It is therefore, in the circumstances, the manifest duty of this Court to turn its earnest attention (1) 17 C.TA.R. 261, 292. ", "(2) 28 C.L.R. 129. ", "691 ", "to the provisions of the Constitution itself. That instrument is the political compact of the whole of the people of Australia, enacted into binding law by , and it is the chief and special duty of this faithfully to expound and give effect to it according to its own terms, finding the intention from the words of the compact, and upholding it throughout precisely as framed. In doing this, we follow, not merely previous instances in this and other s in Australia, but also the precedent of in v. of Lincoln(1), where the Lord Chancellor., speaking for in relation to reviewing its own prior decisions, said: \"Whilst fully sensible of the weight to be attached to such decisions, their Lordships are at the same time bound to examine the reasons upon which the decisions rest, and to give effect to their own view of the law\". The ground upon which came to that conclusion we refer to, but need not repeat, adding, however, that as the and State Parliaments and Executives are themselves bound by the declarations of this as to their powers inter se, our responsibility is so much the greater to give the true effect to the relevant consti- tutional provisions. In doing this, to use the language of Lord in v. ), \"a judicial tribunal has nothing to do with the policy of any Act which it may be called upon to interpret. That may be a matter for private judgment. The duty of the , and its only duty, is to expound the language of the Act in accordance with the settled rules of construction\". \" ", ", J. at page 160 added:- ", "\"But the decision is now directly impugned by the claimant; and it is our duty to reconsider the subject, and to obey the Constitution and the Act rather than any decision of this Court, if the decision be shown to have been mistaken\". has therefore considered itself free to review its own decisions just as much (1) [1892] A.C. 644. ", "(2) [1913] A.C. 107, 118. ", "88 ", "692 ", "as of , examine the reasons upon which the decisions rest and to give effect to its own views of the law, in other words to reconsider the subject and to obey the Constitution and the Act rather than any decision of the if the decision be shown to have been mistaken. ", "Our Constitution has drawn freely inter alia upon the Constitution of the United States and it would be helpful to consider what is the position in the United States in regard to the re-consideration of its previous decisions by . There have been numerous decisions of in which the has departed from the doctrine of stare decision and has either refused to follow or overruled its previous decisions. ", "In v. Woodman(1) Mr. Justice observed:- \"The rule of stare decision, though one tending to consistency and uniformity of decision, is not inflexible. Whether it shall be followed or departed from is a question entirely within the discretion of the court, which again is called upon to consider a question once decided\". Mr. Justice while delivering his dissenting opinion in Washington v. & Co. (2) thus expressed himself with regard to the propriety upon the part of of departing from its earlier doctrines if it has come to consider those doctrines as erroneous:- \"The doctrine of stare decisis should not deter us from@ overruling that case and those which follow it. The decisions are recent ones. They have not been acquiesced in. They have not created a rule of property around which vested interests have clustered. They affect solely matters of a transitory nature. On the other hand, they affect seriously the lives of men, women, and children, and the general welfare. Stare decisis is ordinarily a wise rule of action. But it is not a universal, inexorable command. The instances (1) 218 U.S. 205. ", "(2) 264 U.S. 219. ", "693 ", "in which the court has disregarded its admonition are many\". The same learned Judge in a dissenting opinion in v. ) reiterated the same position in the manner following: ", "\"Stare decisis is not, like the rule of res judicata, a universal, inexorable command\" ", "After quoting the passage from the judgment of Mr. Justice in v. Woodman(1) above cited the learned Judge proceeded:- ", "\"Stare decisis is usually the wise policy, because in most matters it is more important that the applicable rule of law be settled than that it be settled right............................ This is commonly true even where the error is a matter of serious concern, provided correction can be had by legislation. But in cases in- volving the Federal Constitution, where correction through legislative action is practically impossible, this has often overruled its earlier decisions. The bows to the lessons of experience and the force of better reasoning, recognizing that the process of trial and error, so fruitful in the physical sciences, is appropriate also in the judicial function.................... Recently, it overruled several leading cases, when it concluded that the should not have been permitted to exercise powers of taxation which it 'had theretofore repeatedly sanctioned. In cases involving the Federal Constitution the position of this unlike that of the highest court of England, where the policy Of stare decisis was formulated and is strictly applied to all classes of cases. is free to correct any judicial error; and the remedy may be promptly invoked\". ", "It will be instructive at this juncture to note the following passages to be found in foot-note 3 at p. 825 in the report of this case(3): ", "\"Compare , Ch. J. in Passenger Cases, 7 How. 283, 470; 12 L. Ed., 702, 780: After such opinions judicially delivered, I had supposed that question to be settled, so far as any question upon the construction of the Constitution ought to be regarded (1) 285 T.T.S. 393. ", "(2) 218 U.S. 205. ", "(3) 76 L. Ed. 815, as closed by the decision of this Court. I do not, however object to the revision of it, and am quite willing that it be regarded hereafter as the law of this court, that its opinion upon the construction of the Constitution is always open to discussion when it is supposed to have been founded in error, and that its judicial authority should hereafter depend altogether on the force of the reasoning by which it is supported\". ", "Compare , J. in v. ): \"It is more important that the court should be right upon later and more elaborate consideration of the cases than consistent with previous declarations. Those doctrines only will eventually stand which bear the strictest examination and the test of experience \" . ", "In v. People of the State of New York(\") Mr. Justice stated:- ", "\"But the-ultimate touchstone of constitutionality is the Constitution itself and not what we have said about it\". The same principle was reiterated in v. All wright(3):- ", "\"In reaching this conclusion we are not unmindful of the desirability of continuity of decision in constitutional questions. However, when convinced of former error, this has never felt constrained to follow precedent. In constitutional questions, where correction depends upon amendment and not upon legislative action this throughout its history has freely exercised its power to re- examine the basis of its constitutional decisions. This;- has long been accepted practice, and this practice has continued to this day\". ", "and in United States of America v. (1) in the dissenting judgment of , C.J. at p. 579:- ", "\"This Court has never committed itself to any rule or policy that it will not \"bow to the lessons of experience and the force of better reasoning\" by overruling a mistaken precedent.................... This is (1) 154 U.S. 288, 322. ", "(3) 321 U.S. 649 (2) 306 U.S. 466,491. ", "(4) 322 U.S. 533 especially the case when the meaning of the Constitution is at issue and a mistaken construction is one which cannot be corrected by legislative action. To give blind adherence to a rule or policy that no decision of this is to be overruled would be itself to overrule many decisions of the which do not accept that view. But the rule of stare decisis embodies a wise policy because it is often more im- portant that a rule of law be settled than that it be settled right. This is especially so, where as here, Con- gress is not without regulatory power........ The question then is not whether an earlier decision should ever be overruled, but whether a particular decision ought to be. And before overruling a precedent in any case it is the duty of the to make certain that more harm will not be done in rejecting than in retaining a rule of even dubious validity\". ", "The position has been thus summarised by Willoughby on the Constitution of the United States-Vol. I-Second Edition-at p. 74:- ", "\"There are indeed good reasons why the doctrine Of stare decisis should not be so rigidly applied to the constitutional as to other laws. In cases of purely private import, the chief desideratum is that the law remain certain, and, therefore, where a rule has been judicially declared and private rights created thereunder, the courts will not., except in the clearest cases of error, depart from the doctrine of stare decisis When, however, public interests are involved, and especially when the question is one of constitutional construction, the matter is otherwise. An error in the construction of a statute may easily be corrected by a legislative act, but a Constitution and particularly the Federal Constitution, may be changed only with great difficulty. Hence an error in its interpretation may for all practical purposes be corrected only by the court's repudiating or modifying its former decision\". These then are the principles which should guide us in determining whether,we should reconsider the earlier decisions of this Court.- We are here not merely concerned with legislative enactments which it would be within the competence of either or to enact if our earlier decisions were erroneous. We are concerned with the construction of the Provisions of the Constitution which it will be almost impossible- to amend. considered itself bound by its previous decisions, because it felt that the Act of Parliament could set right an erroneous decision of the by enacting appropriate legislation. But as well as of the United States felt themselves free to reconsider their earlier decisions because of the practical impossibility of correcting the erroneous decisions through legislative action. They considered it their bounden duty to construe the constitutional provisions and be guided the provisions of the Constitution itself and not what had been their earlier decisions on the questions of its construction. The only safeguard which they put on the exercise of such power\" of reconsideration was that the earlier decision should be manifestly wrong or erroneous. We here also are concerned with the construction of the provisions of the Constitution which cannot be amended so easily and if we come to the conclusion that the earlier decision was manifestly Wrong or erroneous and that public interest demanded that the same should be reconsidered we should not have the slightest hesitation in doing so. We therefore approach the consideration of the earlier decision of this Court in the Bombay Sales Tax Appeal bearing in mind the principles above enunciated. ", "It will be necessary at the outset to take stock of the situation as it obtained before the enactment of article 286 of the Constitution. The Government of India Act, 1935 contained provisions in regard to the distribution of legislative powers between the Dominion and in sections 99 and 100 . was competent to make laws including laws having extra-territorial operation for the whole or -any part of the Dominion and were competent to make laws for the Provinces for any part thereof, The legislative heads in respect of which the laws could be made by the respective Legislatures were enumerated in the lists of the Seventh Schedule to the Act and the. demarcation between the powers of and in that behalf was to be found in section 100 . Entry 48 in List II of the said Schedule gave the power to in respect of \"taxes on the sale of goods and on advertisements\". Even though the entry mentioned taxes on sale of goods that head was construed to mean in reality a power to tax the transaction and the power to tax the transaction carried with it the power to tax either party thereto. The expression \"taxes on sale\" was therefore con- strued to include also a tax on purchases of goods, as the transaction resulted in change of ownership from one person to another and was from its very nature a bilateral transaction with a seller on the one hand and the purchaser on the other. ( v. State of Madras(1)), The same distribution of legislative powers obtained when the Constitution came to be enacted and article 245 provided that may make laws for the whole or any part of the territory of India, and may make laws for the whole or any part of the State. Exclusive power to make laws with respect to the legislative heads enumerated in the Union List (List I) and the State List (List II) of the Seventh Schedule to the Constitution was given to and by article 246. Entry 54 of the State List gave the exclusive power to the State Legislatures with respect to taxes on the sale or purchase of goods other than newspapers. What was implicit in the phraseology of Entry 48 of List II of the Seventh Schedule to the Government of India Act was thus made explicit by the phraseology adoptted in Entry 54 of the State :List in the Seventh Schedule to the Constitution. ", "Prima facie laws enacted by State Legislatures would have operation within the territories of the States. Primarily legislation of a country is territorial (1) A.1 R. 1958 Madras 105, and the general rule is \"extra territorium jus dicenti impunne non paretur\". The laws of a nation apply to all its subjects and to all things and acts within its territories. (See on the Interpretation of Statutes-10th Edn. page 144). ' on Statute Law-5th Edn. at p. 174 contains the following citation from the speech of Lord in v. Boosey(1) \"Prima facie the Legislature of this country must be taken to make laws for its own subjects exclusively\". The same principle has been applied also to sales tax and it is stated in American Jurisprudence-Vol. 47, p. 202 Para. 5 under the caption \"Territorial Jurisdiction\" that:- \"The general rule that a State may not tax persons, property or interests which are not within its territorial jurisdiction is applicable to sales taxes\". It would therefore appear that when the State Legislatures enacted laws in respect of taxes on sales or purchases of goods they would only have operation within the territories of the States and the sales or purchases of goods even though they are not specified in the relative entry to be \"within the territories\" of the States would Prima facie be such as take place within the respective territories of the States. ", "This power to tax the sales or purchases of goods would again have to be construed with reference to the connotation of the term \"sale\" as it was understood in the legislative practice of the country at the time when the power was conferred. As was observed by Their Lordships of the Privy Council in v. Dunphy(2):- ", "\"When a power is conferred to legislate on a particular topic it is important, in determining the scope of the power, to have regard to what is ordinarily treated as embraced within that topic in legislative practice and particularly in the legislative practice of the which has conferred the power\". ", "The expression \"Sale of goods\" in Entry 48 in List (1) [1854] 4 H.L.C. 815, 955. ", "(2) [1933] A.C. 156, 165. ", "699 ", "11 of the Seventh Schedule to the Government of India Act, 1935 came to be construed by this Court in prakash(1) in relation to an attempt by the State of Uttar Pradesh to tax forward contracts of sale and this Court held:- ", "\"There having existed at the time of the enactment of the Government of India Act, 1935, a welldefined and well- established distinction between a sale and an agreement to sell it would be proper to interpret the expression 'sale of goods' in Entry 48 in the sense in which it was used in legislation both in England and India and to hold that it authorises the imposition of a tax only when there is a completed sale involving transfer of title\". The expression \"sale of goods\" was construed in the light of the definition thereof to be found in section 4 of the Indian Sale of Goods Act (Act III of 1930) as also the corresponding provision of the English Sale of Goods Act and the relevant passage from Halsbury's Laws of England, Vol. 15, Para 13 quoted therein. Section 4 of the Indian Sale of Goods Act runs as follows:- ", "\"(1) A contract of sale of goods is a contract whereby the seller transfers or agrees to transfer the property in goods to the buyer for a price. There may be a contract of sale between one part-owner and another. ", "(3) Where under a contract of sale the property in the goods is transferred from the seller to the buyer, the contract is called a sale, but where the transfer of the property in the goods is to take place at a future time or subject to some condition thereafter to be fulfilled, the contract is called an agreement to sell. ", "(4) An agreement to sell becomes a sale when the time elapses, or the conditions are fulfilled subject to which the property in the goods is to be transferred\". The corresponding provision in section I of the English Sale of Goods Act is as follows:- ", "\"(1) A contract of sale of goods is a contract (1) [1955] 1 S.C.R. 243. ", "89 ", "700 ", "whereby the seller transfers or agrees to transfer the property in goods to the buyer for a money consideration, called the price. There may be a contract of sale between one part-owner and another. ", "(3)Where under a contract of sale the property in the goods is transferred from the seller to the buyer the contract is called a sale; but where the transfer of the property in the goods is to take place at a future time or subject to some condition thereafter to be fulfilled the contract is called an agreement to sell. ", "(4)An agreement to sell becomes a sale when the time elapses or the conditions are fulfilled subject to which the property in the goods is to be transferred\". This being the legislative practice in India as well as in England at the time when the power to tax sales or purchases of goods was conferred on the State Legislatures the scope of that power would have been ordinarily determined by the definition of the sale of goods to be found in these- respective Sales of Goods Act s and the State Legislatures would have had the power to tax sales or purchases of goods in which the property in the goods passed within the respective territories of the States. This was not a power to tax a seller or a purchaser in personam. It was a power to tax the sale or purchase of goods which took place within the territories of the State and was to be exercised in those cases where the property in the goods which were the subject matter of the sale or purchase passed within the territories of the State. ", "This position however was not acceptable to the various States which wanted to enlarge the scope of their power to tax sales or purchases of goods. There was therefore an attempt made to analyse the concept of sale into its various ingredients and to fasten upon any one of the ingredients as conferring upon them the power to tax the sale or purchase of goods by having resort to the theory of territorial connection or nexus. As was observed by , J. in (1) at p. 1101:- ", "\"The difficulty is apparent when one begins to split a sale into its component parts and analyse them. When this is done, a sale is found to consist of a number of ingredients which can be said to be, essential in the sense that if any one of them is missing there is no sale. The following are some of them: (1) the existence of goods which form the subject matter of the sale, (2) the bargain or contract which, when executed, will result in the passing of the pro- perty in the goods for a price, (3) the payment, or promise of payment, of a price, (4) the passing of the title\". Having analysed the concept of the sale thus into its essential ingredients the only essential condition which was considered necessary to be satisfied was the completion of the transaction of sale wheresoever it may take place and the taxable event was taken to be any one of these essential ingredients provided it took place within the territories of the State,. Reliance was placed for this purpose on the decision of in In re The Central Provinces and Berar Sales of Motor Spirit and Lubricants Taxation Act, 1938 (O. P. & Berar Act No. XIV of 1938)(2) where Their Lordships observed that:- ", "\"Tax on sale of goods must necessarily be a tax imposed at the time of the sale of goods and must exclude other forms of transfer like mortgages, leases, etc.\" Similar observations were also to be found in the (3) where it was stated that a tax on the sale of goods is a tax levied on the occasion of the sale of goods and the liability to tax arises on the occasion of the sale. The sale was therefore taken to be the concrete event which gave rise to the power of the State to tax the sale of goods but was taken as not necessarily taking place within the territories of the taxing State, the only thing considered essential for the purpose being the (1) S.C.R. 1069. (2) F.C.R. 18, 86, 87, (3) F.C.R. 90, 101. ", "702 ", "territorial connection or nexus between the taxing State and one or more of the necessary ingredients of sale analysed as above. The territorial connection or nexus theory was sought to be supported by reference to certain decisions of , e.g., v. ) where , J. observed:- ", "\"So long as the statute selected some fact or circumstance which provided some relation or connection with New South Wales, and adopted this as the ground of its interference, the validity of an enactment reducing interest would not be open to challenge\". ", "and the dissenting judgment of , J. in v. Commissioner of Taxation (N.S. W.)(2) which stated that:- ", "\"I do not deny that once any connection with New South Wales appears the legislature of that State may make that connection the occasion or subject of the imposition of a liability. But the connection with New South Wales must be a real one and the liability sought to be imposed must be pertinent to that connection\". ", "These observations of the learned Judges of were referred to with approval by our in Governor-General-in-Council v. ). It was an income-tax case and the dispute related to the claim of to levy income-tax and super tax on the dividends paid to the assessee company (which was a joint stock company incorporated under the English Companies Act having its registered offices in the Isle of Man and its main offices in England) by nine sterling companies, the bulk of whose shares were held by the assessee company. These sterling companies were registered under the English Companies Act and were controlled in London where the Boards of Directors sat, the share registers were situate and dividends were declared. They however carried on the business (1) (19341 50 C.L.R. 581, 600. ", "(2) [1937] 56 C.L.R. 331, 361. ", "(8) A.I.R. 1944 F.C. 51 s.c. 1944 F.C.R. 229 of manufacturing and selling tobacco and cigarettes in India and the business in India where all profits were made was managed by the local boards which were constituted by the Boards in London. The financial policies of these companies were controlled by and in all important matters of business were consulted and all the general meetings of the Companies were held in England. The dividends of these Companies were also declared by them in England and paid by them in England to the assessee company in England. It was however held that the source of the dividends paid to the assessee company by the sterling companies was British Indian and when the attempt was to tax income and not the corpus and the question to be considered was the 'source' of that income it was legitimate to take into account the place where the business from which the income was derived was in fact carried on and not to treat the situs of the shares in the eyes of the law as concluding the matter. The Court was therefore of the opinion that the source of the dividends paid to the assessee company by the sterling companies was British Indian and that in making them liable to income-tax on that basis was not giving its law any extra-territorial operation. , C. J. who delivered the judgment of the Court further quoted with approval the following passage from the judgment of , J. in v. Federal Commissioner of Taxation(1) at p. 236:- ", "\"The Constitution requires that it must be possible to predicate of every valid law that it is for the peace, order and good government of the Dominion with respect to a granted subject, e.g., customs, taxation, external affairs. In such cases, the presence of non-territorial elements in the challenged law has to be considered upon a slightly different footing and those affirming its validity have to show not only that the Dominion has some real concern or interest in the matter, thing or circumstance dealt with by the legislation, but that the concern or interest is of such (1) [1933] 49 C.L.R. 220. ", "704 ", "a nature that the challenged law is truly one with respect to an enumerated subject-matter\". ", "Two more decisions of reiterating the same principle may be noted in this context: Wallace Bros. & , Bombay City(1) and (2). In the former case the held that where has conferred a power to legislate on a particular topic it is permissible and important in determining the scope and meaning of the power to have regard to what is ordinarily treated as embraced within that topic in the legislative practice of the United Kingdom. The general conception as,to the scope of the legislative practice in the United Kingdom with regard to income-tax is that given a sufficient territorial connection between the person sought to be charged and the country seeking to tax him, income-tax may properly extend to that person in respect of his foreign income. That general conception, both on a consideration of the British legislation and as a matter of construction of the Government of India Act, 1935, finds a place in the phrase \"taxes on income\" as used in that Act and the principle of sufficient territorial connection is implicit in the power conferred by the Act of 1935. The derivation from British India of the major por- tion of its income for a year gives to a company as respects that year a territorial connection sufficient to justify the company being treated as at home in British India for all purposes relating to taxation on its income for that year from whatever source it may be derived, and if it is so at home in British India it is a person properly subject to the jurisdiction of the Central Indian legislature. In the latter case the held that a law imposing a tax' cannot be impugned on the ground that it is extra-territorial if there is a connection between the person who is subjected to the tax and the country which imposes that tax. The connection must however be a real one and the liability sought to be imposed must be pertinent to that connection; but, if these conditions are satis- ", "(1) [1948] F.C.R. 1. ", "(2) [1948] F.C.R. 121, fled it is of no importance on the question of validity that the liability imposed is, or may be, disproportionate to the territorial connection. , C. J. also observed at p. 141:- ", "\"As mentioned above, the aspect of it affecting persons who are beyond the jurisdiction of the municipal courts cannot be considered sufficient for the to hold it ultra vires. The municipal courts are bound to enforce the law. Whether after obtaining the opinion or decree the same is enforceable against the other side or not, is not a matter for the 's consideration. The has only to see that the legislation is within the ambit of the powers of the \". ", "Having resort therefore to the territorial Connection or the nexus theory enunciated in the cases above noted and analysing the concept of sale into its necessary ingredients as above the various State Legislatures enacted laws in respect of taxes on sales or 'purchases of goods spreading their net as wide as they could having regard to the situation obtaining in their respective territories. A transaction of sale or purchase of goods thus came to be taxed by more States than one even though really there was only one transaction of sale or purchase of goods as between the seller and the purchaser. The consumer was the last person who ever counted in the scramble for taxes on sales or purchases of goods and even the free flow of inter-State trade and commerce was affected. The state of affairs was thus graphically described by , C. J. in his judgment in Bombay Sales Tax Appeal(1) at p. 1079:- \"In exercise of the legislative power conferred upon them in substantially similar terms by the Government of India Act, 1935, the Provincial Legislatures enacted sales-tax laws for their respective Provinces, acting on the principle of territorial nexus referred to above; that is to say, they picked out one or more of the ingredients constituting a sale and made them the basis of their sales-tax legislation. Assam and Bengal made among other things the actual (1) [1953] S.C.R. 1069. ", "706 ", "existence of the goods in the Province at the time of the contract of sale the test of taxability. In Bihar the production or manufacture of the goods in the Province was made an additional ground. A net of the widest range perhaps was laid in Central Provinces and Berar where it was sufficient if the goods were actually 'found' in the Province at any time after the contract of sale or purchase in respect thereof was made. Whether the territorial nexus put forward as the basis of the taxing power in each case would be sustained as sufficient was a matter of doubt not having been tested in a court of law. And such claims to taxing power led to multiple taxation of the same transaction by different Provinces and cumulation of the burden falling ultimately on the consuming public. This situation posed to the Constitution makers the problem of restricting the taxing power on sales or purchases involving inter-State elements, and alleviating the tax burden on the consumer\". ", "Apart from the States resorting to the territorial connection or nexus theory in the manner aforesaid the courts also appeared to lend their support to the theory and in particular in two decisions, (1) and (2), gave its imprimatur to this theory. In the former case the expression \"sale of goods\" was understood in its popular sense as distinct from its legal sense and it was held that the sales tax could be levied if the transaction substantially took place within the State notwithstanding that the property did not pass within the State. In the latter case it was held that the power of the State to impose taxes was not conditioned on the subject- matter being wholly within its jurisdiction and the exercise of the power was valid if there was sufficient territorial connection with reference to the subject-matter. After discussing the American case law on the subject the came to the conclusion that in respect of inter-State sales the State in which the contract was concluded was the (1) A.I.R. 1953 Madras 91. ", "(2) A.I.R. 1953 Madras 117. ", "707 ", "only State which had the power to impose a tax. This Court also in the majority judgment in the Bombay Sales Tax Appeal(1) while summarising the position as it obtained before the enactment of the Constitution incidentally expressed its opinion in this behalf at p. 1078 as under:- \"As pointed out by in the case(2) in dealing with the competency of to impose tax on the income arising abroad to a non-resident foreign company, the constitutional validity of the relevant statutory provisions did not turn on the possession by the legislature of extra-territorial powers but on the existence of a sufficient territorial connection between the taxing State and what it seeks to tax. In the case of sales-tax it is not necessary that the sale or purchase should take place within the territorial limits of the State in the sense that all the ingredients of a sale like the agreement to sell, the passing of title, delivery of the goods, etc., should have a territorial connection with the State. Broadly speaking, local activities of buying or selling carried on in the State in relation to local goods would be a sufficient basis to sustain the taxing power of the State, provided of course, such activities ultimately resulted in a concluded sale or purchase to be taxed\". ", "In another case decided immediately thereafter (3) this Court understood this expression of opinion in the majority judgment as laying down the principle of territorial connection or nexus:- \"It admits of no dispute that could not pass a taxation statute which would be binding on any other part of India outside the limits of the Province, but it would be quite competent to enact a legislation imposing taxes on transactions concluded outside the Province, provided that there was sufficient and a real territorial nexus between such transactions and the taxing Province. This principle, which is based upon the decision of in v. (1) B.C.R. 1069. (2) F.C.R. 1. (3) S.C.R. 677, Commissioner of Income-tax, Bombay(1) has been held by this court to be applicable to sale tax legislation, in its recent decision in the Bombay Sales Tax Act case(2) and its propriety is beyond question. As a matter of fact, the legislative practice in regard to sale tax laws adopted by the Provincial Legislatures prior to the coming into force of the Constitution has been to authorise imposition of taxes on sales and purchases which were related in some manner with the taxing Province by reason of some of the ingredients of the transaction having taken place within the Province or by reason of the production or location of goods within it at the time when the transaction took place\". It may be observed that in the question of the territorial connection or nexus was not directly in dispute and in 's case(3) referred to above it was taken as decided by this Court in that the theory of territorial connection or nexus was applicable to sales tax legislation. It is a moot point whether this theory of territorial connection or nexus which has been mainly applied in income-tax cases is also applicable to sales tax legislation, the spheres of an income-tax legislation and sales tax legislation being quite distinct. Whereas in the case of income-tax legislation the tax is levied either on a person who is within the territory by exercising jurisdiction over him in personam or upon income which has accrued or arisen to him or is deemed to have accrued or arisen to him or has been derived by him from sources within the territory and it is therefore germane to enquire whether any part of such income has accrued or arisen or has been derived from a source within the territory, in the case of sales-tax legislation it is the sale or purchase of goods which is the subject-matter of taxation and it cannot be predicated that the sale or purchase takes place at one or more places where the necessary ingredients of sale happen to be located. The theory of territorial connection or nexus was not put to the test at any time prior to the enactment of (1) [1948] F.C.R. 1. ", "(2)[1953] S.C.R. 1069. ", "(3) [1953] S.C R. 677. ", " ", "the Constitution and it is not necessary also for us to give a definite pronouncement on the subject. Suffice it to say that there was this evil which was rampant in the by reason of the various States fastening upon one or more ingredients of the sale and arrogating to themselves the power to tax sales or purchases of goods by reason of the territorial connection or nexus which they claimed to have with one or more of the ingredients of the sale provided however that a sale or purchase ultimately did take place either within their territories or anywhere else. It was this evil amongst others which was sought to be remedied by the Constitution- makers when they came to enact article 286 of the Constitu- tion. ", "The Constitution-makers enacted several provisions in Part XIII relating to trade, commerce and intercourse within the territory of India with an eye towards India as an economic unit and enacted in article 301 that trade, commerce and intercourse throughout the territory of India shall be free and by article 302 they empowered the to impose such restrictions on the, freedom of trade, commerce and intercourse between one State and another or within any part of the territory of India as may be required in the public interest. Broad based on this conception of freedom of trade, commerce and intercourse throughout the territory of India and also with a view inter alia to relieve the consumer of the burden of multiple taxation which he was subjected to by the various State Legislatures by having resort to the territorial connection or nexus theory as aforesaid the Constitution-makers in article 286 enacted restrictions on the power of the State Legislatures in regard to the imposition of tax on the sale or purchase of goods and these restrictions were fourfold: - (1) State Legislatures were restrained from imposing a tax on the sale or purchase of goods where such sale or purchase took place outside the State; ", "(2) The State Legislatures were restrained from imposing a tax on the sale or purchase of goods where such sale or purchase took place in the course of, the import of the goods into or export of the goods out of the territory of India; ", "(3) The State Legislatures were restrained from imposing a tax on the sale or purchase of any goods where such sale or purchase took place in the course of inter-State trade or commerce except in so far as the might by law otherwise provide; ", "and (4) The State Legislatures were restrained from imposing a tax on the sale or purchase of any such goods as had been declared by by law as essential for the life of the community unless such law had been reserved for the consideration of the President and had received his assent. These were the four restrictions which were put upon the powers of the State Legislatures to impose a tax on the sales or purchases of goods and were imposed with different objectives in view. ", "The first restriction was devised to achieve the objective of relieving the consumer of the burden of multiple taxation and put it out of the power of a State to tax the sale or purchase of goods where such sale or purchase took place outside the State. The Sale of Goods Act contained several provisions which determined when a sale or purchase took place or in other words when the property in the goods sold passed from the seller to the purchaser. But it was silent in regard to the place where the sale or purchase took place. There was no rule of law enacted therein which determined the situs or location of such sale or purchase and resort was therefore had to the general law of the land for the purpose. The territorial connection or nexus theory had an eye over the various ingredients of a sale or purchase and if anyone or more of these ingredients fixed the situs or the location of the sale it would mean that a sale had more situses or locations than one. This state of affairs could not be allowed to continue any further having, regard to the interests of the consumer and it was therefore thought necessary, when the State Legislatures were restrained from imposing a tax on sale or purchase of goods where such sale or purchase took place outside the State, also to determine when such sale or purchase could be said to take place outside the State. It was for this purpose that the Explanation to article 286(1) (a) was enacted and it was enacted for the express purpose therein mentioned, viz., \"for the purposes of sub-clause (a)\". The Explanation was thus enacted for the express purpose of determining what sales or purchases could be said to have taken place outside the State and the basic idea which was adopted therein was that under the general law relating to Sale of Goods property in the goods would by reason of such sale or purchase pass in a particular State which would therefore be the situs or location of such sale or purchase. But notwithstanding that fact the sale or purchase was deemed to have taken place in the State in which the goods have actually been delivered as a direct result of such sale or purchase for the purposes of consumption in that State. The antithesis appears to have been between the State in which the property in the goods has by reason of such sale or purchase passed and the State in which the goods have actually been delivered as a direct result of such sale or purchase for the purpose of consumption in that State and in the competition between ", "-these two s the Explanation provided that the sale or purchase in those circumstances shall be deemed to have taken place in the in which the goods have actually been delivered as a direct result of such sale or purchase for the purpose of consumption therein. This Explanation was interpreted in various ways, one view being that It defined an outside sale and went no further and that the situs of the sale was determined for the limited purpose of telling the what it could not tax by telling it that in the cases covered by the Explanation in spite of the property in the goods having passed within its territories it was an outside sale qua that . The other view was that besides fixing the situs of sale in this manner it also. defined what was a sale or purchase which shall be deemed to have taken place in the delivery and thus fulfilled a double function of investing only the delivery with the power to tax such sale or pur- ", "712 ", "chase to the' exclusion of all other s qua whom the sale or purchase was deemed to be an outside sale. The third view was that the Explanation was concerned with fixing the situs of sale in respect of the delivery only and did not affect the power of the in which the property in the goods had passed to tax such sale or purchase which it enjoyed by reason of the fact that the property in the goods had passed within its territories. A fourth possible view was that the only which could not tax such sale or purchase on the ground that the sale was outside the was the in which the property in the goods had passed leaving open to the other s to tax such sales or purchases by having resort to the power which they possessed under article 246(3) and Entry 54 of List 11 of the Seventh Schedule to the Constitution. Whatever be the correct view to take of this Explanation one fact remained that article 286 (1) (a) and the Explanation thereto were enacted with the one and only motive to relieve the consumer of the burden of multiple taxation to which he was subjected by having resort to the territorial connection or nexus theory and to replace the nexus theory by what may be described as the situs theory fixing the situs or the location of the sale or purchase and putting a restriction on the taxing power of the s qua which it could be predicated that such sale or purchase took place outside the , thus leaving only one in which the goods have been actually delivered as a direct result of such sale or purchase for the purpose of consumption therein \"free to tax the sale or purchase having resort to the powers vested in by article 246(3) and Entry 54 of List II of the Seventh Schedule to the Constitution. If therefore the situs or location of the sale was laid down as the criterion of the taxing power of the the non- obstante clause contained in the Explanation gave the clue as to what was in mind of the Constitution-makers when they substituted the situa theory in place of the nexus theory which theretofore prevailed. They took cognisance of the general law relating to the sale of goods under which the property in the goods passed by reason of such sale or purchase. The conception of the transfer of ownership of the goods by the seller to the purchaser was thus accepted by them as determining the situs or location of the sale or purchase and this conception had its roots in the relevant provisions of the Sale of Goods Act s both in India and in England and in spite of the fact that those provisions did not in terms say where the sale took place or the transfer of ownership came about or the property in the goods passed by reason of such sale or purchase, the general law relating to sale of goods was taken in the Explananation to fix the situs or location of such sale or purchase within the territories of a particular and that event could only take place in one and not in more s than one. There could be only one situs or location of the sale or purchase and if that were so the in whose territories such sale or purchase took place or in which the property in the goods passed by reason of such sale or purchase was the which could claim the power to tax such sale or purchase by reason of its having taken place within its territory. It would therefore appear that the Constitution-makers had in enacting the Explanation the one and only motive of negativing the territorial connection or nexus theory and replacing it by the situs theory and fixing the situs or location of the sale or purchase within the in which the property in the goods passed by reason of such sale or purchase. While doing so they also created a legal fiction whereby in the competition between what may be called the title and the delivery the delivery was given the power to impose a tax on sale or purchase of goods where the goods had actually been delivered as a direct result of such sale or purchase for the purpose of consumption in that . If the object to be achieved was the relief of the consumer from the burden of multiple taxation that object could only be achieved by subjecting him to taxation at the instance of one only and not by more s than one and to that extent the view that both the title and the delivery would be entitled to impose the tax on the sale or purchase falling within the Explanation was clearly erroneous, the only which would be in a position to tax the sale or purchase in question being the in which the goods had been actually delivered as a direct result of such sale or purchase for the purpose of consumption therein. The second restriction on the taxing power of s was devised to safeguard the import and export trade of the country and embraced transactions of sale or purchase of goods where such sales or purchases took place in the course of the import of the goods into or export of the goods out of the territory of India, vide article 286(1) ", "(b). It is significant to observe that the Explanation to article 286(1)(a) was definitely put for the purposes of subclause (a) and it had therefore no application to the cases which were covered by article 286(1) (b). This concept was quite distinct from the concept which was dealt within article286(1)(a). The sales or purchases were looked at from different view-points and the particular aspect which was dealt with in article 286(1)(b) was the import- export aspect of the transactions of sales or purchases. That aspect was separately dealt with even though for the sake of economy of words the provisions in regard thereto were incorporated in article 286(1). They had nothing in common with the provision contained in article 286 (1) (a). The third restriction was devised to protect inter trade or commerce and covered transactions of sale or purchase of any goods where such sale or purchase took place in the course of trade or commerce except in so far as might by law otherwise provide. This was still another viewpoint and this restriction was put with a view to safeguard the freedom of trade, commerce and inter- course throughout the territory of India. The imposition of this restriction meant that the s would be deprived of a large part of their income which they used to derive from taxing sales or purchases falling within this category before the commencement of the Constitution. A proviso was therefore enacted that the President may by order direct that any tax on the sale or purchase of goods which was being lawfully levied by the Government of any immediately before the commencement of the Constitution shall, notwithstanding that the imposition of such tax is contrary to the provisions of article 286(2 ), continue to be levied until the thirty-first day of March, 1951. This proviso enabled the Govern- ments to levy the taxes which they used to levy before the commencement of the Constitution up to the 31st March 1951 within which period they were expected to adjust their economies and replenish their treasuries by having resort to their legitimate powers of taxation. By the 31st March 1951 the s could also make representations to the and induce the to otherwise provide by appropriate legislation within the meaning of article 286(2) and autborise them to impose taxes on the sale or purchase of any goods where such sales or purchases took place in the course of trade or commerce. But until that ban was lifted by appropriate legislation by the the by imposed under article 286(2) was absolute and no transaction of sale or purchase of goods where such sale or purchase took place in the course of trade or commerce could ever be made the subject-matter of taxation at the instance of . The Explanation to article 286(1) (a) being expressly for the purpose of sub- clause (a), i.e., for the purpose of determining what transaction of sale or purchase was outside the or inside the as above stated could not be read into article 286(2) nor could it be read as an exception or proviso to article 286(2). Reading it as such exception or proviso would be contrary to the express terms of the Explanation and would also stultify the purpose of the enactment of article 286 (2) thus taking a large slice out of the transactions falling within that category. The rule as to the exclusion of the general provision by a special provision would also not apply for the simple reason that the object of article 286(1)(a) and the Explanation thereto is quite distinct from the object of article 286(2) and the objects being quite different these provisions do not cover. the same subject-matter and therefore there would be no occasion for the application of that rule of construction. To this extent the view taken by me in the Bombay Sales Tax Appeal(1) that the Explanation to article 286(1)(a) was an exception or proviso to article 286(2) was clearly erroneous. ", "The last restriction on the taxing powers of the State Legislatures was devised to maintain the supply of essential commodities and related to the imposition of a tax on the sale or purchase of any goods as have been declared by by law to be essential for the life of the community unless such law has been reserved for the consideration of the President and has received his assent. This restriction also though of another nature was a restriction put on the power of the State Legislatures to tax such transactions of sale or purchase and was absolute in terms having nothing whatever to do with the restrictions put in the earlier clauses of article 286. These transac- tions comprised a distinct category by themselves and were not affected by the restrictions put in the earlier clauses of the article. It may be noted that the transactions covered by article 286(1) (a ), article 286(2) and article 286(3) though looked at from different view-points-may overlap. A transaction which is covered by article 286(1) ", "(a) may also be covered by article 286(2) and both these sets of transactions may be covered by article 286(3). Such overlapping would not necessarily mean that the provisions of one particular clause have to be read as fastening upon the transactions falling within the category comprised therein and treating them as lifted out of the ban sought to be imposed by the other clauses of the article. Each ban has got to be effective and imposed on the transactions falling within its ambit and even though the transaction may be saved out of the ban imposed in one particular clause it may just as (1) S.C.R 1069. ", "717 ", "well fall within the ban imposed in another clause and thus be excluded from the taxing power of the Legislatures. It cannot therefore be urged that the Explanation to article 286(1)(a) lifts the transaction out of the ban imposed by article 286(2) or by article 286(3) and leaves such transaction of sale or purchase as is covered by the Explanation free to be taxed by the delivery in spite of the same being of an inter- character or being in regard to goods declared by by law to be essential for the life of the community. ", "The whole scheme of article 286 is that four, different restrictions are put on the taxing power of the State Legislatures in regard to the sales or purchases of goods and each one of these restrictions has got to be considered separately by itself and it is only those transactions of sale or purchase which do not fall within any of those categories that can be taxed by the State Legislatures by having resort to their powers under article 246(3) and Entry 54 of List 11 of the Seventh Schedule to the Constitution. The learned Government Advocate for Bihar however urged five distinct reasons why article 286(2) cannot apply to the transactions of sale or purchase covered by article 286(1) ", "(a) and the Explanation thereto and they were:- (1) The class of sales falling under article 286(1) (a) form a special class of inter-State sales which on general principles ought not to be affected by the general provisions of article 286(2); ", "(2) If article 286(2) applies to the class of sales covered by article 286(1)(a) and the Explanation thereto it would result in discrimination against local trade in favour of inter-State trade and it will be inconsistent with the provisions of Part XIII of the Constitution; (3) The purpose of article 286 being to eliminate multiple taxation and article 286(1) (a) having already achieved that purpose with regard to the class of sales falling within it it was no longer necessary for that purpose to apply article 286(2) to that class of sales; ", "718 ", "(4) The Constitution itself has divided inter-State sales into two categories and in relation to one class it has itself provided which State will tax and under what conditions and in relation to the other class the Constitution itself has imposed a ban in general terms and granted power in general terms again to relax that ban as and when thinks fit; and (5) By a legal fiction, the inter-State sale is converted into an intrastate sale. ", "We shall deal with these reasons seriatim. As to reason (1): it was submitted that the transactions of sale covered by article 286(1) (a) and the Explanation thereto and the transactions of sale covered by article 286(2) were of the same category and both these provisions dealt with the same topic. That being so, article 286(2) contained a general provision whereas article 286(1) (a) and the Explanation thereto contained a special provision having reference to the transactions of sale or purchase falling within that category, with the result that the rule of harmonious construction applied and the special provision was to be read as an exception to the general provision. This argument found favour with the below as well as myself in the Bombay Sales Tax Appeal(1). This rule of harmonious construction no doubt would apply if the topics covered by both these provisions were the same, and the subject matters dealt with in both these provisions were identical. There is this difference however between the two provisions, viz., that the transactions covered by both do not fall within the same category and a transaction of sale which is looked at from the point of view of its being an outside or an inside sale may just as well be a sale in the course of inter-State trade or commerce. In article 286(1)(a) the transaction is looked at from the point of view of its situs or location and in article 286(2) it is looked at from the point of view of its being in the course of inter-State trade or commerce and the two approaches are quite distinct one from the other. That being so it cannot (1) (1953) B.C.R. 1059. ", " ", "be said that the topics which are dealt with by both these provisions are the same or that the subjectmatters thereof are identical. The ban which is, imposed by article 286(1)(a) and the rule of harmonious construction and the exception of the special provisions from the general one as indicated above would' have no application in the matter of the construction of both these provisions. As to reason (2): there is no question of discrimination against local trade in favour of trade if article 286(2) applied to the class of sales covered by article 286(1) (a) and the Explanation thereto. The local trade would certainly be liable to the levy of intra-State sales tax which could be avoided if a transaction takes place in the course of interState trade or commerce. For the working of the as an economic unit and for the free flow of trade, commerce and intercourse throughout the territory of India it is necessary that no fetter should be placed on the course of trade or commerce. The consumers within a State who would resort to transactions of purchase across the border with a view to avoid the payment of the intrastate sales tax would be comparatively few and could in conceivable cases be caught within the net by imposing a tax on goods of a non-discriminatory nature within the meaning of article 304(a). This reason is therefore no deterrent to our holding that the ban under article 286(2) is absolute and unaffected by article 286(1) ", "(a) and the Explanation thereto. ", "As to reason (3): it postulates that the only purpose of the enactment of article 286 (1) (a) and the Explanation thereto is to eliminate multiple taxation. If that was the only purpose of the article it might conceivably be argued that once that purpose is achieved in regard to the particular set of transactions which are covered by article 286(1)(a) and the Explanation there to there is no further need of putting any ban under article286(2). As has been already observed before, the purposes of the enactment of article 286 were manifold and they were achieved by enacting the four distinct provisions in the manner indicated above and the restrictions which were put on the powers of the State Legislatures to tax transactions of sale or purchase were mutually exclusive even though the transactions might so far as their nature and character be concerned overlap in certain events. Even though therefore a transaction fell within the ban of article 286(1)(a) it could nonetheless be subjected to the ban which was imposed by article 286(2) and it could be taxed only if it survived this scrutiny also, which could be done if the by law otherwise provided as set out in article 286(2). As to reason (4): it assumes that the Constitution itself has divided transactions of sale or purchase in the course of inter-State trade and commerce into two distinct categories, one falling within article 286 (1) (a) and the Explanation thereto and the other falling within article 286(2). There is no warrant for holding that transactions in the course of inter-State trade or commerce are divided into such distinct categories for the purpose of the imposition of the ban. The transaction of sale or purchase would be one but it is subject to the imposition of distinct bans having regard to the view-point from which it is being looked at. If it is looked at from the view-point of its being an outside or an inside sale it may be caught within the ban of article 286(1) (a). If it is looked at from the view-point of its being a transaction in the course of inter-State trade or commerce it may be caught within the ban imposed by article 286(2). These bans are mutually exclusive and may have to be applied to the same transaction of sale or purchase, one ban not necessarily excluding the other. ", "As to reason (5): the argument totally ignores the purpose and efficacy of a legal fiction. A legal fiction pre- supposes the correctness of the state of facts on which it is based and all the consequences which flow from that state of facts have got to be worked out to their logical extent. But due regard must be had in this behalf to the purpose for which the legal fiction has been created. If the purpose of this legal fiction contained in the Explanation to article 286(1)(a) is solely for the purpose of sub-clause (a) as expressly stated it would not be legitimate to travel beyond the scope of that purpose and read into the provision any other purpose howsoever attractive it may be. The legal fiction which was created here was only for the purpose of determining whether a particular sale was an outside sale or one which could be deemed to have' taken place inside the and that was the only scope of the provision. It would be an illegitimate extension of the purpose of the legal fiction to say that it was also created for the purpose of converting the inter- character of the transaction into an intrastate one. This type of conversion could not have been in the contemplation of the Constitution makers and is contrary to the express purpose for -Which the legal fiction was created as set out in the Explanation to article 286(1)(a). ", "All these reasons therefore taken individually or collectively are not sufficient to negative the position that the transactions covered by article 286(1) (a) and the Explanation thereto are not excluded from the operation of article 286(2) and that the ban under article 286(2) also applies to the same. ", "It was also urged that this-construction put upon article 286(1)(a) and the Explanation thereto and article 286(2 would render the Explanation nugatory and that the Constitution makers at the very commencement of the Constitution would not have given the power by one hand and taken it away by the other and that therefore the Explanation to article 286 (1) (a) should be read as an exception or a proviso to article 286(2). This argument no doubt found favour with me in the Bombay Sales Tax Appeal(1) and also with below. If due regard however is had to the purpose of the enactment of article 286 as a whole and also to the various considerations which have been set out herein above it is clear that this argument is untenable. The transactions of sale and purchase covered by the Explanation to article 286(1) (a) are not necessarily co-extensive or conterminous with the transactions of sale or purchase covered by article 286(2). There are transactions which would be covered by the (1) (1953] S.C.R. 1069. ", "722 ", "Explanation to article 286 (1) (a) without their being transactions of sale or purchase in the course of inter trade or commerce and which therefore would without anything more be covered by the Explanation and would be the subject- matter of taxation by the delivery by the appropriate exercise of its power of taxation. There is also a further fact to be noted and it is that even though the transactions covered by both these provisions may be conceivably co- extensive or conterminous with each other, the Explanation to article 286(1)(a) would come into operation the moment the ban of article 286(2) was lifted by an otherwise provision enacted by and it was certainly lifted up to the 31st March 1951 by the President directing the continuance of the operation of the sales tax laws which previously existed in the various s. It could not therefore be stated that the construction put upon article 286(1)(a) and the Explanation thereto and article 286(2) as above would render the Explanation nugatory. if the s thought that the operation of the ban under article 286(2) prevented them from taxing transactions of sale or purchase which take place in the course of inter- trade and commerce and which are also covered by the Explanation to article 286 (1) (a) it was open to them to adopt proper measures for lifting the ban under article 286(2) and making themselves free to tax the transactions of sale or purchase covered by the Explanation. would in that event consider the proposals made by the respective s in their proper perspective having regard to the provisions of the Constitution in regard to the freedom of trade, commerce and intercourse throughout the territory of India, the con- venience or inconvenience of the public and the needs of the respective s and lift the ban in the manner and to the extent it thought fit. ", "The majority judgment in the Bombay Sales Tax Appeal has been construed by the various States as giving them an authority to impose a tax on the transactions of sale or purchase covered by the Explanation to article 286(1) (a) and authorising them to impose such tax on the seller even though he may be residing outside their territories. The non-resident businessmen therefore who entered into transactions of sales of goods where as a direct result of such sales the goods are actually delivered for the purpose of consumption in a particular State have been sought to be subjected to the levy of sales tax at the instance of these States with great inconvenience and harassment to themselves, and the warrant for their action in this behalf is stated by these States to be the majority judgment of this Court. The various States however in the scramble for taxes have been oblivious to the fact that a transaction of sale or purchase is not a unilateral transaction but a bilateral one and when it is looked at from the point of view of a sale or purchase it is one transaction which has two facets. From the point of view of a seller it is a sale transaction and from the point of view of a purchaser it is a purchase transaction. When therefore the transaction is one on which a tax on sale or purchase can be levied it does not necessarily mean that only a sales tax can be levied and not a purchase tax. The inside dealer may therefore be taxed on his purchases or if be sells in retail to actual consumers in the State be may be taxed on the sales. If the inside dealer is himself the consumer then there will be no difficulty in assessing him for his books will show how much he has imported from other States and how much he has consumed. In any case, the convenience or inconvenience of collecting a sales tax or a purchase tax is not a relevant consideration when one is considering the validity or otherwise of such a tax, as was observed by in the case of A. Lt. v. Commissioner of Income-tax, Bombay(1) at p. 141. In the very judgment of the majority in the Bombay Sales Tax Appeal(2) there is a passage at p. 1084 which indicates that all buyers within the delivery State except those buying for re-export out of the State would be within the scope of the Explanation and liable to be taxed by the State on such transactions and it would be an unwarranted assumption on (1) [1948] F.C.R. 121. (2) [1908] B.C.R. 1069, the part of anyone who read that judgment to say that the delivery State was entitled to levy a tax on the sale or purchase of goods falling within the Explanation to article 286(1) (a) on the seller alone. The seller would be outside the territories of the taxing State and would primarily not be liable to the jurisdiction of the Sales Tax Act enacted by the taxing State. It would be by adopting the theory of the territorial connection or nexus as it was being done prior to the enactment of the Constitution that the taxing State would seek to reach the non-resident businessmen outside its territories and if regard be had to the fact that the taxation is either in personam or in relation to the transaction of sale or purchase which takes place within its territory there is no warrant at all for taxing the outside businessmen on the transactions of sale or purchase covered by the Explanation to article 286(1 ) (a). All the provisions contained in the Bihar Sales Tax Act with regard to the registration 'of the outside dealer, the maintenance of the books of account, submission of returns by him to the Sales Tax authorities of the State of Bihar, the production and inspection of books of account before the Sales Tax authorities, the search of the premises of the outside dealer by them and the imposition of penalties on him by reason of his noncompliance with the various provisions contained in the Act amongst others are unwarranted and illegitimate exercise of the powers incidental to the power of taxing sales or purchases conferred upon the State of Bihar by article 246(3) and the Entry-54 in List 11 of the Seventh Schedule to the Constitution and do not affect non- resident businessmen who are outside the territories of the State of Bihar. ", "The majority judgment in the Bombay Sales Tax Appeal(1) did not say that the delivery State was entitled to tax the sellers in the transactions of sale or purchase covered by the Explanation to article 286(1) (a). The question whether the seller or the purchaser would be subject to the levy of a tax on the transaction of sale or purchase at the instance of the delivery (1) S.G.A. 1069. ", "725 ", "State was not before the -and the observations contained in the majority judgment were made with reference to a pure question of the interpretation of article 286(1) ", "(a) and the Explanation thereto. As a matter of fact the passage above-quoted from the judgment(1) at p. 1084 would go to show that they contemplated the purchasers being amenable to tax at the instance of the delivery in the case of transactions covered by the Explanation to article 286(1) (a). Even though it is not strictly relevant to consider the consequences of a particular position in law when construing a statutory provision it is nonetheless necessary to visualise those consequences when one tries to probe into the mind of the legislators and see whether they could have ever contemplated such consequences. If the construction sought to be put upon the Explanation to article 286(1) (a) and the majority judgment in relation- thereto by the Legislatures were accepted, all outside dealers wheresoever they may be located or residing or carrying on their business all over the Union would be amenable to the levy of sales tax at the instance of the delivery and one dealer in a particular who had a very large business and was entering into transactions of sale with consumers in outside s all over the Union would be amenable to the jurisdiction of several s in the matter of his transactions of sale of his goods. There are as many as 21 Sales Tax Act s to be found in the Manual of Sales Tax Acts and if a dealer in one was going to be held amenable to the levy of sales tax at the instance of all the other s it would mean that he would have to ascertain from the purchaser in each of the transactions of sale which he enters into the to which the purchaser be. longs, whether the purchaser is purchasing the goods for the purpose of consumption within that , to get himself registered as a dealer in that , to maintain his books of account with a view to produce them and subject them to inspection by the Sales Tax authorities in that , to submit returns of the sales tax recovered by him from the purchasers (1) S.C.R. 1069, in that before the Sales tax authorities of that and make himself liable for the non-observance of the various requirements of the Sales Tax Act enacted by that . The task of fulfilling the requirements qua one would be formidable enough. But when one visualises that the dealer who enters into such transactions of sale with the various customers may be subjected to this process at the instance of each and every within whose territory the purchaser may happen to be importing the goods as a direct result of such sale for actual consumption within the territories of that , one can easily understand what untold harassment and inconvenience the dealer would have to suffer from. It will be easy to understand that if those were the circumstances attendant upon his business the dealer may as well close down his business rather than submit to all this harassment at the hands of the various s. The free flow of trade, commerce and intercourse throughout the territory of India will be thoroughly choked up and we are quite sure that neither the Constitution makers nor the majority judgment in the Bombay Sales Tax Appeal would ever have contemplated these consequences. It is legitimate therefore to hold that no such thing could ever have been ,contemplated by them and nothing would have been farthest from their minds than such a position. The seller in such cases would certainly not be amenable to the levy of a sales tax at the instance of the delivery and no law passed by the delivery in regard to a levy of sales tax would have any operation against the non-resident businessman who enters into a transaction of sale where as a direct result of such sale the goods are actually delivered for consumption within the taxing . ", "If however the majority judgment be construed to have said that the seller could be subjected to the levy of a sales tax at the instance of the delivery State in the case of transactions covered by the Explanation to article 286(1) ", "(a) I am of the opinion that it was clearly erroneous and public interests demand that the same should be reversed, After further and fuller consideration of the matter in the light of the very elaborate arguments which have been addressed before us by the learned Counsel for the Appellants and the Respondents and also the Interveners, I feel that the conclusion reached in the Bombay Sales Tax Appeal(2) needs to be revised and I am of the opinion that article 286(2) puts an absolute restriction on the taxing power of the States where transactions of sale or purchase take place in the course of inter-State trade or commerce unless and until the ban is lifted by within the terms thereof and until such ban is lifted no delivery State within the meaning of the Explanation to article 286(1) (a) much less the other States are in a position to impose a tax on transactions of sale or purchase covered by the Explanation. ", "The appeal should therefore be allowed and a direction should issue against the State of Bihar to refrain from taxing the sales or purchases of goods which take place in the course of inter-State trade or commerce even though the goods as a direct result of such sale or purchase are actually delivered in Bihar for consumption in that State until otherwise provides within the meaning of that expression in article 286(2). The Appellant should get its costs throughout from the State of Bihar, the rest of the parties appearing before us to bear and pay their respective costs of this appeal. ", ", first, and to my mind, the most important, point that requires careful consideration in this case is whether, and if so within what limits,, this Court will observe the rule as to the binding character of a judicial precedent with reference to its own prior decisions Admittedly the question that has been raised in this case as to the construction of article 286 of the Constitution is one that is directly covered by a recent -decision of this Court in the .(1). The rule as to the binding character of judicial precedents is one which is normally accepted (1) (1958) S.C.B. 1069. ", "728 ", "by all the which function on the pattern of the British Judicial system. This rule, in its very strict form., is observed by the English . ( v. (1) and v. )). has ruled, after careful consideration, in its judgment in the case in , v. ) that the is bound to follow its own previous decisions and will not allow any question settled thereby to be reopened and argued again nor can the be asked to reverse its own prior decision. Such reversal, if needed, is one that has to be brought about by parliamentary legislation. of has,however, not adopted this extremely rigorous view but has felt itself free, in appropriate cases, to reconsider its prior decisions. (Vide In Be. Transferred Civil Servants (Ireland) Compensation(4)). The same is the case with of the United States of America. (See by on the Constitution of the United States, Vol. I, page 74). Our Constitution which has made detailed provision about various matters- relating to including a matter relating to its practice, such as, whether there can be a dissenting judgment (see article 145(5)) has not, in terms, made any provision in this behalf. Article 141 , no doubt, provides that \"the law declared by shall be binding on all within the territory of India\". It has been urged before us that the phrase \"all \" is comprehensive enough to include . It is, pointed out, that since every decision declares the law, a later decision declaring the law in a contrary sense, would in effect, be the exercise of legislative function which must be taken to have been impliedly prohibited. While these arguments are not without force, it is reasonably clear, in the context of article 141 , that the phrase \"all \" must refer to other than . In the absence, therefore, of any clear provision in the (1) K.B. 718. ", "(3) [1898] A.C. 376. ", "(2) (1947] 2 All E.R. 884. ", "(4) [1929] A.C. 242, Constitution and in view of the fact that this Court has historically succeeded to the preexisting and ., we cannot deny to this Court, the competence to reconsider its prior decisions. ", "But, it does not follow that such power can be exercised without restriction or limitation or that a prior decision can be reversed on the ground that, on later consideration, the disagrees with the prior decision and thinks it erroneous. The necessity for certainty and continuity in the declaration of law by the highest courts in the country is recognised on all hands. That necessity is all the greater, and not the less, by reason of the Constitution itself having formally provided that the decisions of this are declaratory of the law. The rule as to the binding character of a judicial precedent is based on a juristic principle of universal application. The reason for its adoption is ''the disastrous inconvenience of subjecting each question decided by a previous judgment to reargument, thereby rendering the dealings of mankind doubtful by different decisions; so that in truth and in fact there would be no real final court of appeal\" (See , v. ) at page ", "380). It is, therefore, necessary to consider within what limits the competency of this to reconsider its prior decisions may well be exercised. For this purpose the actual practice of other comparable s as affording guidance requires close examination. ", "The practice of is indicated in the following passage from on the Constitution of the United States of America, Vol. I, page 74.- \"ln cases of purely private import, the chief desideratum is that the law remain certain, and, therefore, where a rule has been judicially declared and private rights created thereunder, the courts will not, except in the clearest cases of error, depart from the doctrine of stare decisis. When, however, public interests are involved, and especially when the ques- ", "(1) [1898] A.C. 375. ", "730 ", "tion is one of constitutional construction, the matter is otherwise. An error in the construction of a statute may easily be corrected by a legislative act, but a Constitution and particularly the Federal Constitution, may be changed only with great difficulty. Hence an error in its interpretation may for all practical purposes be corrected only by the 's repudiating or modifying its former decision\". ", "It would appear, therefore, that the power of recon- sideration of a prior decision is somewhat freely exercised by in Constitutional cases. The reason for such free exercise, or to the same extent, does not exist under our Constitution. To appreciate this, it is necessary to compare the provisions in the two Constitutions for amendment of the Constitution. The machinery for amendment of the Constitution of the United States is provided in Article V thereof and is as follows: \"The , whenever two thirds of both houses shall deem it necessary, shall propose amendments to this Constitution, or, on the application of two thirds of the several States, shall call a convention for proposing amendments, which, in either case, shall be valid to all intents and purposes, as part of this Constitution, when ratified by the legislatures of three fourths of the several States, or by conventions in three fourths thereof, as the one or the other mode of ratification may be proposed by the \". Under article 368 of our Constitution, the normal procedure provided for amendment, except in respect of specified matters to be presently enumerated, is as follows: \"An amendment of this Constitution may be initiated by the introduction of a Bill for the purpose in either house of , and when the Bill is passed in each by a majority of the total membership of that and by a majority of not less than two-thirds of the members of that present and voting, it shall be presented to the President for his assent and upon such assent being given to the Bill, the Constitution shall stand amended in accordance6 with the terms of the Bill\". ", "731 ", "In respect, however, of a limited number of matters specified in the Constitution, an additional step is required, namely, that \"before the Bill making provision for such amendment is presented to the President for assent, the amendment shall also require to be ratified by the Legislatures of not less than one half of the States specified in Parts A and B of the First Schedule by resolutions to that effect passed by those Legislatures\". Now the special matters where amendment is conditional on this additional requirement relate to the election of President (articles 54 and 55), extent of the executive power of the ( article 73 ), extent of the executive power of a State ( article 162 ), provisions relating to the Judiciary () (Chapter IV of Part V), and to of the various States, in Parts A and B (Chapter V of Part VI) and in Part C ( article 241 ), and the relations between the and the States (Chapter I of Part XI), as also the distribution of the legislative powers and the various lists in the Seventh Schedule, the representation of the States in , and the provision in the Constitution relating to the machinery for amendment of the Constitution. Thus, it will be seen, excepting in respect of a few basic matters-of which it may be noticed article 286 is not one-the normal machinery for the procedure of amendment is the same as that for the passing of any statute by except that a specified majority in each of the is essential, the securing of which would be difficult or easy according to the strength of the at the time in each of the . The requirement of special majority as a condition for the passing of legislation in respect of certain specified items of business is not altogether an unknown feature. However that may be, it is quite clear that while the amendment of the Constitution does not depend upon the ordinary majority rule under which conducts its business, the machinery therefor is by invoking the very same and not anything so difficult, cumbrous and dilatory as that envisaged in article V of the American Constitution. Even as regards the few specified matters for which an additional requirement of ratification by State Legislatures is provided for, our machinery for amendment is clearly much easier and less cumbersome. It does not appear to me., therefore, right-to rely upon the American practice -as a safe guide to determine our practice on the question as to the binding character of a judicial precedent. Neither, are we bound to adopt the very rigid rule which has formulated for its own practice. The problem of interpreting a written Constitution does not generally arise before it. ", "The only other comparable courts whose practice has been brought to our notice, through citation of cases, are and . As this is the first case in this Court wherein this question arises, it is desirable to consider that practice carefully for our guidance, though it is not necessary to lay down any absolutely rigid or inelastic formula. It is worthwhile at this stage to notice what, according to the Constitution of Australia., is the machinery for the alteration of their Constitution. This is to be gathered from section 128 of the Commonwealth Act of 1900 which -broadly speaking-shows that what is required there is an absolute majority in each of the and the approval of each State to be obtained by a referendum to the electors of each State. This is definitely much more difficult, cumbersome and dilatory than what obtains in our Constitution. Therefore, there can be no reason for our adopting a less rigid standard than that adopted by , nor is there any reason for our adopting a standard less rigid than that of , who while feeling themselves free not to follow the very strict rule of , were under no constitutional limitations in this behalf. ", "The practice of as to the limits within which they generally exercise the freedom to reconsider their prior decisions can be gathered from the cases in In Re. Transferred Civil Servants (Ireland-) Compensation(1); Attorney-General for Ontario v. Canada Temperance Federation(3); and (3). The matter was discussed elaborately and various prior decisions of were considered and the conclusion was summed up as follows in In Be. Transferred Civil Servants (Ireland) Compensation(1): \"There is no inherent incompetency in ordering rehearing of a case already decided by the , even when a question of a right of property is involved but such an indulgence will be granted in very exceptional circumstances only. It is of the nature of an extraordinarium remedium\". After the above formulation of their practice, in this case permitted itself to reconsider the previous decision in 's case(4), on two grounds. (1) The case came up before them on a reference under section 4 of Act of 1933, and that reference would have been futile if it did not necessarily involve such reconsideration. (2) The reference itself was granted on account of an alleged material mistake of fact, into which the previous of bad fallen. On such reconsideration the previous decision was affirmed. In Attorney-General for Ontario v. ) expressed itself as follows at page 206: ", "\"The appellants' first contention is that 's case(5) was wrongly decided and ought to be overruled. Their Lordships do not doubt that in tendering humble advice to His Majesty they are not absolutely bound by previous decisions of the , as is by its own judgments. In ecclesiastical appeals, for instance, on more than one occasion, the has tendered advice contrary to that given in a previous case, which further historical research has shown to have been wrong. But on constitutional questions it Must be seldom indeed that the would depart from a previous decision which it may be (1) [1929] A..C. 242. ", "(3) 76 I.A. 10. ", "(2) [1946] A.C. 198. ", "(5) 7 A. C. 829. ", "(4) [1927] A.C. 674. ", "734 ", "assumed will have been acted on both by Governments and subjects\". ", "In this case was invited to reconsider the correctness of the law laid down by them in v. The Queen(1) but they declined to do so on two grounds, viz., (1) on constitutional questions the seldom departs from its previous decisions, and (2) the prior decision stood unchallenged for over 60 years. ", " (2) stated that it is only \"in the most exceptional cases\" that they would tender advice to His Majesty inconsistent with a previous decision and reaffirmed the decision in Gill's case(3). ", "Three cases of out of those brought to our notice are instructive. In the case(3) the position was expressed in the following terms. observed as follows: ", "\"In my opinion it is impossible to maintain as an abstract p imposion that the is either legally or technically bound by previous decisions. Indeed, it may, in a proper case, be its duty to disregard them. But the rule should be applied with great caution, and only when the previous decision is manifestly wrong, as, for instance, if it proceeded upon the mistaken assumption of the continuance of a repealed or expired statute, or is contrary to a decision of another which this is bound to follow; not, I think upon a mere suggestion that some or all of the members of the later might arrive at a different conclusion if the matter were res integra. Otherwise there would be grave danger of want of continuity in the interpretation of the law\". ", "Justice observed as follows: ", "\"I have never thought that it was not open to this to review its previous decisions upon good cause. The question is not whether the can do so, but whether it will, having due regard to the need for continuity and consistency in judicial decisions. Changes in the number of appointed Justices can, I (1) 7 A.C. 829. 2) 76 I.A.110. ", "(3) 76 I.A. 41. (4) la C. L. B. 54, take it, never of themselves furnish a reason for re- view............. But the can always listen to argu- ment as to whether it ought to review a particular decision, and the strongest reason for an overruling is that a decision is manifestly wrong, and its maintenance is injurious to the public interest\". ", "Having so laid down the rule of practice for their , the learned Judges, on account of the special circumstances in that case, unanimously agreed to reconsider the prior decision and on such reconsideration affirmed it. In so reaffirming the prior decision, one of the learned Judges, Justice , stated his grounds to the following effect: \"In 's case(1), the consisted of all the Justices of this who could sit on the application. The case was very fully argued. Both parties and two of the States were represented by counsel. The judgments were considered judgments delivered more than two weeks after the preliminary objection was taken.............. Under the circumstances I have no hesitation in following the judgment\". ", "The same learned Judge at another portion of his judgment stated as follows: ", "\"If we do not show some respect to our own Court's decisions, no counsel will feel safe in advising the public, and it will create uncertainty and confusion\". The principles so laid down have been reiterated in a recent case of in v. Federal Commissioner of Taxation in the following terms: \"The Court is not bound by its previous decisions so as absolutely to preclude reconsideration of a principle approved and applied in a prior case, but, as was stated in v. Malone(3), the exceptions to the rule are exceptions which should be allowed only with great caution and in clear cases\" ", "Then the above quotation from the judgment of Justice in the Tramways Ca8e(4) was repeated (1) 11 C.L.R. 1. k$) 66 C.L.R. 10, (2) 77 C.L.B. 493. ", "(4) 18 O.L.R. 54. ", "736 ", "and the principle indicated therein was reaffirmed. In this case the was asked to overrule their prior decision in v. ). The learned Judges declined to reconsider it with the following observations: \"The decisions of a superior have a double aspect. They determine the controversy between the parties, and in deciding the case they may include a statement of principle which it is the duty of that and of all subordinate courts to apply in cases to which that principle is relevant. Continuity and coherence in the law demand that, particularly in this , which is the highest court of appeal in Australia, the principle of stare decision should be applied, save in very exceptional cases\". The criterion, viz., that of manifest error plus injury to public interest by maintenance of previous decision laid down in the above cases as being the ground on which a reconsideration can be granted was reiterated by Justice in his judgment in Attorney-General for N.S.W. v. ). In this case the High was asked to reconsider the correctness of the majority decision in a prior case) viz., that in v. ). On reconsideration the Judges by a majority affirmed the prior decision. One of the learned Judges, Justice , considered the matter on its merits elaborately and came to the conclusion that if the matter were to be considered afresh he should prefer a view con- trary to that which had been expressed in the prior decision but concurred with the majority view with the following observations: ", "\"There appears to me to be no ground for reconsidering the decision in case(3) unless it be a sufficient ground simply that the opposite conclusion is to be preferred. It is evident that the decision was reached only after a very full examination of the question. It cannot be said that any compelling consideration or important authority was overlooked or that the decision conflicts with well established principle or fails (1) 69 C.L.R. 270, (2) 85 C.L.R. 237. ", "(3) 68 C.L.R. 227, to go with a definite stream of authority. It is a recent and well considered decision upon what is evidently a highly disputable question. ", "I do not think that we should reconsider the correctness of that decision. The proper course judicially is to follow and apply that decision\". ", "This is a strong case of the year 1951-1952 indicating, the most recent practice of that , and the above passage aptly summarises almost the very considerations applicable to the present case. ", "A consideration of these cases shows that while the highest courts other than have reserved to themselves theoretically the competency to reconsider the correctness of a prior decision, they have also carefully confined the actual exercise of that power within very narrow limits. In a number of cases in which they did permit themselves to reconsider, they have ultimately declined to overrule the prior decision notwithstanding that another view might well have been taken. The only instances brought to our notice where, on a reconsideration, a previous decision was not followed, are two. One is v. ). 'that was a case where the question which arose was a very important one as to the power of State to encroach on the field of the Commonwealth by virtue of a rule of construction laid down in an earlier case, viz., Rail-way Servants' case(2). The learned Judges were of the opinion that that was a question of far reaching public importance and that the prior decision being manifestly wrong and opposed to the rules Of Construction laid down by in a number of cases, should be reconsidered and overruled. It would be seen that in this case the acted upon the limitations which they have laid down in the course of their decisions, that reconsideration and overruling of a prior decision is to be confined to cases where the prior decision is manifestly wrong and its maintenance (1) 28 C.L.R 129. ", "(2) 4 C.L.R. 488. ", "738 ", "is productive of great public mischief. The second is the case in v. The King(1), where declined to follow its prior decision in 's case(2). In this case, , while it reaffirmed the proposition that a prior decision upon a given set of facts ought not to be reopened without the greatest hesitation, explained why they, in fact, differed from the previous one in the following passage: \"From a perusal of the judgment in 's case(2), it is apparent that the history of the adoption and promulgation of the various statutes and proclamations dealing with the effect of the evidence of accomplices in South Africa was only partially put before the , and much material which has now been ascertained was not presented to their Lord- ships on that occasion. The present case, therefore, is one in which fresh facts have been adduced which were not under consideration when 's case was decided, and accordingly it is one in which, in their Lordships' view, they are justified in reconsidering the foundations on which that case was determined\". ", "This was a case where the question arose as to the applicability of the English rule of law relating to ac- complice evidence as laid down in v. Baskerville(3), viz., that a particular portion of the rule which lays down that the evidence of one accomplice cannot be corroborated by that of another. What was under consideration of was whether a prior decision of , construing a particular section of the relevant statute applicable in that case in consonance with the above rule, was correct. It will be noticed that the overruling of the prior decision in this case was based on the fact that important and relevant material was not placed before in the earliar case. These cases emphasise under what exceptional circumstances a prior decision of the highest and final court in a country is treated as not binding on itself. ", "(1) [1950] A.C,. 379. (2) [1949] A.C. 258. ", "(3)[1916] 2 K.B. 658. ", "Now what are the grounds in the present case to justify a reconsideration of the prior decision ' At this stage, I cannot help noticing that the argument before us-as it appears to me has taken a somewhat unusual course. I should have thought that when the decision in a case so recent as that in the case(2) given after full consideration, is sought to be challenged, the first question to have been considered was whether or not there were circumstances to justify a reconsideration. It is only after the came at least to a prima facie conclusion on that preliminary matter that a reargument on the merits of that decision should have been permitted. What has happened, however, is that the correctness of the prior decision was straightaway canvassed be. fore us and the question as to the competency or the desirability of such reconsideration occupied a later and subordinate part in the arguments. I must confess to the feeling that this all important question has accordingly suffered for want of due consideration thereof at the stage of arguments before us. Now., let us see what are the facts relating to the prior decision. The decision was given on the 30th March, 1953. The case itself was heard for 12 working days, i.e., from the 9th February, to the 25th February, 1953. and as many as eight States were permitted to intervene and their arguments were also heard. A perusal of the judgments then given shows that every possible aspect had been fully presented and considered. The decision was that of a majority as against that of one dissenting Judge. One of the learned Judges in the majority, though concurring on the main point, was prepared to go further on one point than what the majority held (though, as appears now, he is prepared to go back on his concurrence). It is true that in a later decision in (2), another Judge of this expressed a view in disagreement with the view of the majority in this case. But that was a decision given on the 8th May, 1953, more than a month after the judgment in the prior (1) B.C.B. 1069. ", "(2) [1954] S.C.R.53 case had been delivered and had become binding. The question that directly arose for consideration in the later case was not the one that had come in for consideration in the earlier case. However this may be, it may also be noticed that in a later decision of this in (1) the law as laid down in the earlier decision in the case(2), was reiterated and it was stated that the correctness of the view could no longer be questioned. (See page 1126). In view of the above facts, it appears to me prima facie, that there was no reason for reconsideration except the fact that a different view had been taken by two of the learned Judges of this and except the chance of a differently constituted majority emerging on rehearing. This, however, is sought to be justified on various grounds. It is said that the prior decision does not merely determine the rights of the two contending parties to that case but has far reaching effects on the rights of the consuming public and that it involves the adjudication of the taxing power of the States as against the consuming public in general. It is, therefore, said that, if that decision is erroneous, it is our duty not to perpetuate the error. It appears to me, with respect, that this is begging the question. There is no absolute standard by which the erroneous character of a previous decision can be as- certained. What a previous decision has determined, must be presumed to be right unless it can be pronounced to be perverse or manifestly wrong. It is, therefore, a strong thing to characterise a previous decision as erroneous where, even on reconsideration, no unanimity is reached and the previous view is supported by a substantial minority. Nor, can the mere fact of one of the prior learned Judges having gone back on his views be any criterion to determine which out of his two views is erroneous. As regards the suggestion of tax burden on the consuming public, it is relevant to notice that the burden, if any, which arises under the prior decision can only be by legis- (1) S.C.R. 1122. ", "(2) [1953] S.C.R. 1069. ", "741 ", "lative action of the very in which the consuming public are residents. The removal of the burden, if called for,, is a matter which, under the Constitution, can be brought about by democratic process which is available to the consuming public, through its representatives in . It appears to me that that is not a matter for our consideration. I may be permitted to add that in the course of the arguments there has been no serious grievance made about the alleged burden on the consuming public. But there has been a good deal of emphasis on the harassment to the business community, i.e., to the out-of- dealers, from whom the tax is primarily collected and passed on, under the law, to the consumer. We are not, however, concerned with any question arising from such alleged hardship. The hardship such as it is, is one that may have to be obviated by the adoption of a common and agreed machinery by all the s for the assessment (as distinguished from levy) and collection of the tax from out- of- dealers, or if necessary, by the passing of the requisite legislation enabling this to be done. But that hardship, if any, can afford no reason for reversing the prior decision which, as will be shown later, has construed article 286 consistently with the entire scheme of the Constitution. That decision enables the consuming to derive an elastic source of revenue from its own residents to make it available for the expanding needs of the in the discharge of the responsibilities allotted to it under the Constitution. It is not for this now to choose between the alleged hardship of the business community and the interests of the consuming and treat the former as a ground for reconsideration. ", "It is next suggested that there is some vagueness, if not inconsistency, in the prior majority judgment which justifies reconsideration. It is said, with reference to a particular passage quoted from the judgment, that it is only buyers falling within the Explanation who were contemplated as liable and not the out-of- dealers, but that the whole trend of the rest of the judgment and the actual, decision runs counter to this. With -very great respect, it is hardly fair to read the decision as being in any way vague or inconsistent with itself by extracting one single passage. The passage relied on is at page 1084 and appears, in the context where the question was being considered, as to whether the phrase \"actual delivery for consumption\" has reference to \"delivery to the actual consumer-purchaser\" or delivery also to Cc& purchaser for eventual distribution to the consumers in the \". The view indicated in the ex- tracted passage was that delivery to a purchaser for eventual distribution to the consumer in the was also \"actual delivery for consumption\" and hence the designation of purchaser as liable to tax in that passage. That the extracted passage was not meant to indicate that only such purchaser was taxable and not the seller is quite clear from the various passages in the immediately succeeding paragraph at pages 1084 and 1085 where \"taxation of sales or purchases involving inter- elements by the in which the goods are delivered for consumption in the sense explained.above\" is repeatedly referred to. All that can, if at all, be said is that the decision has not, in terms, indicated the choice between the seller or the purchaser as regards taxability but has indicated either of them as taxable. ", "It has next been said that the impugned decision is a recent one and that \"judicial opinion was divided, if not evenly balanced\". It is no doubt true that the prior decision is only two years old. But that is not by itself a ground for reconsideration. On the other hand, I should have thought that the very fact of its being recent should militate against reconsideration. The real test to my mind, as indicated by Justice in Attorney-General for N.S.W. v. ) is whether it was a fully considered judgment and whether any fresh material has been brought to the notice of the . In considering the question whether a decision is open to reconsideration on account of its being recent, it is of importance to observe that our decisions become (1) 85 C.L.R. 237, declarations of law under article 141 and must be treated normally as final from the very moment they are pronounced. The finality of the decisions of this , which is the court of last resort, will be greatly weakened and much mischief done if we treat our own judgments, even though recent, as open to reconsideration. ", "It has next been suggested that rectification of the error, if any, in the view taken by the previous decision, is difficult and that this could be brought about only by the amendment of the legislative lists necessitating the consent of the requisite number of States. With respect, I am unable to appreciate this. The points of difference in the two opposing views ultimately boil down to this. (1) Does the Explanation to article 286(1) (a) taken with the relevant legislative entry enable the consuming State to tax fictional inside sales? (2) If so, does article 286(2) override this taxing power? If the right construction of article 286(2) is not what has been accepted by the majority in the prior decision, what all was required to correct that error would be to amend article 286(2) so as to make it clear that it overrides article 286(1)(a) taken with the Explanation by the insertion therein of some appropriate phrase like \"notwithstanding Explanation to article 286(1)(a)\". The responsibility for any such amendment, if called for, should be left to the who, as recent experience has shown, is quite capable of bringing about constitutional amendments when it felt the clear necessity for it. ", "The proper course for this , therefore, is to adopt the attitude of Justice in the case in Attorney-General for N.S. W. v. ) wherein notwithstanding that he came to a contrary conclusion, he declined to disturb the prior decision. The case for not disturbing the prior decision is all the stronger, where, as happens in the present case, no unanimous opinion could be reached in favour of overruling the prior decision. Notwithstanding my opinion that there is no ground for reconsideration of the prior decision of this (1) 85 C.L.R. 237, in the case(1), I propose, out of respect for my learned brothers, who are prepared to take the opposite view, to give my reasons why, on a fresh consideration of the question involved, I am clearly in agreement with the decision of the majority in the said case. Having had the benefit of reading the judgments of my learned brothers, Justice and Justice , I propose to confine myself mainly to the consideration of the con- struction of article 286. ", "There can be no doubt that article 286 taken as a whole has to be read in the context of the power vested in the s for levying taxes on the sales or purchases of goods (other than newspapers) under Entry 54 of List 11 of the Seventh Schedule taken with article 246(3). Entry 54 does not, in terms, say that the sales or purchases of goods contemplated thereby as taxable are to be sales or purchases \"within the \". In this respect it is in contrast with Entry 26 which vests in the the power to legislate in respect of trade and commerce \"within the \". The apparently wide language of Entry 54 is in recognition of the theory that in substance a tax on sale or purchase of goods is a tax on the goods with reference to the event of sale or purchase thereof. (See the United Motors case(1). Article 286 appears in Part XII of the Constitution relating to finance, property, contracts and suits and is in Chapter I thereof relating to finance. This is mainly concerned with the problem of allocation of finances between the and the s in order to enable each to carry on the respective governmental functions allotted to it under the Constitution. Keeping this context in view as also the avowed purpose of the article as indicated by the marginal note, it may be taken that article 286 was intended to indicate clearly the ambit of the taxing power of the on sales or purchases of goods and to limit it to a demarcated field. To determine the exact scope of this ambit and of the limitations, it is relevant to consider what was the sales-tax law in operation just prior to the new Constitution, (1) S.C.R. 1069. ", " ", "A careful land thorough examination of the Provincial Sales- tax Acts at the time discloses the. following. There were sales tax laws in operation in all the then nine Provinces, which subsequently became Part A States under the Constitution, as also in one Native State of -Mysore. The pattern of the sales-tax laws in every one of the ten units had the following common features (with minor additions and variations). Under the charging section in each of these Acts, tax was levied as against a \"dealer\" whose turnover of sales (or purchases) exceeded a particular amount. A C 'dealer\" was defined as a person carrying -on the business of selling or supplying goods in the Province. \"Sale\" was defined as meaning transfer of property in goods in the course of trade for valuable consideration. In addition, each one of these Sales-tax Act s had an Explanation to the definition of the word \"sale\" to the effect that, notwithstanding anything to the contrary in the Indian Sale of Goods Act , a sale or purchase of goods \"which were actually in the Province\" at the time when the contract of sale or purchase is made, shall be deemed to have taken place in the Province, wherever the 'contract for sale or purchase may have been made. This was, broadly speaking, the common pattern of every one of the sales-tax laws just prior to the 'Constitution, subject to some further additions to the definition of sale by a few of the States, which will be presently noticed. This pattern indicates, that apart from the purely internal sales-in respect of which the power of taxation by the States was undoubted-the States claimed the power to tax sales with an outside element in the following two cases: (1) Where the transfer of ownership in the goods was within the State (assumed to be so) according to the Indian Sale of Goods Act . (2) Where the goods which are the subject-matter of the sale are actually in the Province at the time when the contract of sale is made, i.e., at the crucial moment of transfer of ownership. If I may express this in another way, these Sales-tax Act s purported to tax sales as being within the State, with reference to (1) situs (as assumed) under the Sale of Goods Act , and (2)situs (as probably assumed to be) under the general law. It is possible that this general law was so assumed with reference to the dictum of Lord in Badische Anilin Und Soda Fabrik v. Hickson(1) which suggests that the situs Of the goods at the time of appropriation of the goods to a particular sale is the situs of the sale. Whether the un- derlying assumptions as regards both these criteria were right or wrong is not material at this stage. While this was the general pattern, four of the States claimed the taxing power with reference to some additional criteria. Madras and Mysore had an additional Explanation as follows: \"In case the contract was for the sale or purchase of future goods by description, then, if the goods are actually produced in the Province at any time, after the contract of sale or purchase in respect thereof was made, the sale or purchase shall be deemed to have taken place in the Province, wherever the contract of sale or purchase might have been made, notwithstanding anything to the contrary in the Indian Sale of Goods Act \". ", "Bihar and United Provinces had the following additional Explanation. (Taken from the U. P. Act ). ", "\"Notwithstanding anything in the Indian Sale of Goods Act , the sale of any goods which are produced or manufactured in the Province by the producer or manufacturer thereof, shall, wherever the delivery or contract of sale is made, be deemed for the purposes of the Act to have taken place in the Province\". ", "Both these additions refer to future goods. Madras and Mysore apparently treated such future goods as having been appropriated to the sale the moment they were \"actually produced in the Province\". The Bihar and U.P. addition was more or less the same and is limited to the case of sale by the very manufacturer or/producer. The above additions are in effect the same as category No. 2 of the general pattern as applied to future goods. The underlying assumption appears to be that future goods which are contracted to be sold get appropriated thereto on their coming (1) [1906] A.G. 419. ", "747 ", "into existence and that thus a taxable sale emerges. Besides the above mentioned variations from the general pattern, Bihar and Uttar Pradesh had further additions to the definition of sale relating to forward contracts which virtually amounted to treating \"agreement to sell\" itself as being the taxable event. This, it may be seen, had nothing to do with the nexus theory of taxation of sales and has been pronounced invalid by this Court in (1). From the above broad summary it will be seen that the Provinces were deriving sales-tax revenues not only in respect of purely internal sales, but also in respect of sales with an outside element. But in the generality o such sales, the tax was leviable at either or both of the above mentioned two points, i. e., (1) transfer of ownership within the , (2) actual existence of goods within the at the moment of such transfer. The ultimate consumer in respect of ,such sales would normally be not a person within the taxing . Hence having, regard to the structure of the sales-tax and the universally accepted machinery there for which brings about the passing on, of the incidence thereof, to the ultimate consumer, this must have been felt to be inequitable. It appears to me that in the adjustments called for on the passing of the Constitution it was this feature of the pre-existing sales- tax law which called for being remedied by the imposition of a ban on taxation of sales with an outside element. But that very consideration would equally indicate the permissibility of taxing an outside sale where the ultimate burden of it could be passed on to the resident of the very taxing . This could be done by making the consuming the taxing . This, in my opinion, was the background with reference to which article 286 was incorporated in the Constitution, The Constitution wanted to put a ban on taxation of sales with an outside element on account of the inequity of making the residents of other s (1) 1 S.C.R. 243. ", "95 ", " ", "contribute towards the resources of the selling . But in doing so it could not have intended to confine the resources of the under this head to the come paratively small field of purely internal sales. Having regard to the expanding needs of a social welfare and the limited taxing powers allocated to it, the Constitution could not have meant to limit an elastic source of taxation payable by its own consumers to the very small field of purely internal sales,. it, therefore, selected and took out one category of sale with an outside element from the field of restriction, by adopting the device of a fictional inside sale and left that category taxable so that the incidence thereof may be the same as that of a purely internal sale. This, to my mind, is the reason for the positive approach in the Explanation by a deeming provision as to an inside sale. It is on account of this common feature, as to the incidence of taxation, that the fictional inside sale indicated in the Explanation was assimilated to a purely internal or intra- sale. It appears to me not very reasonable to assume that the Explanation to article 286(1) (a) was required in order merely to determine what an outside sale is. If the Constitution intended nothing more than to ban taxation on outside sales, it might well have contented itself with declaring such a ban. I do not think that the would then have found any serious difficulty in construing \"outside sale\" to mean, a sale with a substantial outside element, or in the alternative, as a sale in which the ownership has passed outside the in the assumed sense of the Sale of Goods Act . It was quite unnecessary and indeed out of the way to define an outside sale as the implied negative of a fictional inside sale. Nor can the purpose of the Explanation be readily assumed to be to obviate the supposed chaotic condition arising out of the adoption of the nexus theory in the Sales-tax Act s. This could have been sufficiently and effectively provided for-as in fact it was done-by the ban imposed under article 286(2). It has been suggested that the Explanation covers some outside ,sales which do not fall within article 286(2) and that therefore the Explanation was necessary. But the possibility of a few ingenuously illustrated cases like the Gurgaon-Delhi illustration put forward in the course of arguments-as falling outside the ambit of article 286(2) and within the scope of article 286(1) (a) taken with the Explanation, would not have been any adequate reason for the Constitution involving itself in two such provisions, mostly overlapping in effect. It appears to 'me, therefore, that the reasons for having these two provisions were distinct and different. Article 286 (1) (a) with the Explanation was meant to prevent taxation whose ultimate incidence would fall on residents of outside s. Article 286 (2) was meant to prevent the taxing structure of the s being availed so as unduly to hamper the freedom of inter- trade and commerce which, for the first time, the Constitution declared by article 301. In this context it also became necessary to provide that the foreign trade of the country should not be affected at all by the sales-tax structure of the s, while at the same time indicating that the internal trade could be permitted to bear a limited burden of taxation. It is in reconciliation of these various ideas that article 286(1) and 12 ) were drafted. Judged in this light the following is the only reasonable construction of article 286(1)(a) taken with the Explanation. This provision, while intended to prohibit taxation by s on outside sales was also meant to demarcate the boundary between inside sales and outside sales and to assimilate one particular category of outside sales into the field of inside sales and to make it available for taxation by the consuming . The underlying aim of this demarcation was to obviate the inequity of one levying a tax whose ultimate incidence was on the residents of another but to provide instead an elastic source of taxation which in its effect was to be against its own residents. The field of export trade is completely marked off as not being available for the operation of sales-tax by article 286 (1) (b). Then the ban on sales in the course of inter- trade and commerce is declared, This ban, which was for a totally different purpose cannot be so construed as to nullify the positive results intended and brought about by article 286(1) (a) read with the Explanation. To such a situation the principle of harmonious construction would apply as enunciated by Lord in v. ) at page 506 in the following terms: ", "\"It is beyond dispute that we are entitled and indeed bound when construing the terms of any provision found in a statute to consider any other parts of the Act which throw light upon the intention of the legislature and which may serve to shew that the particular provision ought not to be construed as it would be if considered alone and apart from the rest of the Act\". ", "If, as my learned brother, Justice , is inclined to think, a sale cannot be said to have occurred in the course of inter- trade and commerce if the sale follows the completion of the inter. transportation of goods, as for instance, would be the case when a hawking pedlar brings goods across a boundary and vends it from door to door in another , then clearly the fiction which brings about the notional inside sale would by itself be sufficient to take such a sale out of the category \" of the course of inter- trade and commerce\". Because, in such a situation, while the transportation of goods across boundaries remains as a fact, the sale itself is deemed to be inside the consuming , the very purpose of the fiction being to shift the situs of the sale for the purpose of taxability. It is) I think, in this sense that in the earlier decision, the learned then Chief Justice laid down that by virtue of the Explanation this particular category of inter- sale became an intrastate sale, of course, not for all purposes, but for the limited purposes for which the Explanation was inserted I viz., the purpose of demarcating the taxable field from the non-taxable field. Looked at either on the ground of harmonious construction or on the ground that the notional inside sale brought about by the Explanation ceased, (1) [1889] 14 A.C. 493, 506, by that very fiction, to be part of the course of inter trade and commerce for taxation purposes, the only proper construction of article 286(2) would be that it cannot override article 286 (1) (a) taken with the Explanation. Having indicated the' broad lines on which I have, on independent consideration of the construction of articles 286(1) and (2), arrived at the same construction as that adopted in the case(1), it is unnecessary for me to deal with all the various aspects raised before us in the course of the arguments, except to express my general agreement with a good deal of the reasoning of my learned brother, Justice , on this part of the case. It is, however, necessary to refer to a few matters referred to in the contrary view. ", "The contrary opinion adopted by my learned brothers is based almost entirely on the view that article 286 is inspired by the anxiety of the Constitution to prevent the mischief of multiple taxation, which arose from the operation of the preexisting sales-tax laws. It is said that this result was achieved by covering all loopholes from various angles, articles 286(1)(a), 286(1)(b), 286(2) and 286(3) being said to be the four plugging points. With respect, I can only think that this is the outcome of an overdrawn picture as to the chaos said to have been created by the earlier sales-tax laws. As already pointed out, the common feature of all the previous ten Sales-Tax Act s, was to bring about limited multiple taxation in respect of outside sales at two points, viz., (1) transfer of ownership within the taxing State, and (2) the actual presence of goods in the taxing State at the point of time when the transfer of ownership takes place in another State. It must be mentioned that none of the Sales-Tax Act s took the mere presence of goods in the State as enabling it to levy the tax. What was taken as enabling taxation was the existence of goods within the State at the crucial point of time, viz., the point at which the ownership became transferred wherever it may be. Once this is appreciated, it is difficult to agree with the assumption that (1) S.C.R. 1069. ", "752 ", "under the pre-existing law, the taxation might get multiplied in the course of the transit of goods under sale through a, number of s, if the goods happened to remain in, the successive s for some time. In none except one of the s would the goods be in actual existence -at the single crucial point of time of transfer of ownership. Hence, I am clear in my mind that the previous legislation would not have normally involved taxation of the same sale with an outside element, at more than two points. (Whether even this would not get limited by the fact that a \"dealer\" is defined in all the then Acts as \"within the Province\" would be a matter for consideration). Four of the then provincial units had, as, already stated, an additional criterion for taxation. But, so far as Madras and Mysore were concerned that criterion which relates to future goods cannot be cumulative with criterion two. So Car as U.P. and Bihar are concerned which authorised the manufacturing as such to levy the tax, it appears to me that if it is borne in mind that this is limited to the sale by the very manufacturer, this.was also not likely to operate as a cumulative point. Even otherwise these additional criteria might, if at all, have given rise to taxation at a third point, when the sale transaction had to be put through via these particular s. But even so there is no justification for the impression of chaotic conditions resulting therefrom which has been assumed. There is no evidence before us that prior to the Constitution there was in fact multiple taxation of sales in operation, at any rate at more than the two points as explained by me above. Hence in the light of the detailed scrutiny of the provisions in the various Sales-Tax Act s which were in force prior to the Constitution) I cannot help feeling that the mischief of multiple taxation which might if at all have existed in a limited measure as pointed out above, has been overstated. No doubt, the future prevention of such multiple taxation by invoking the nexus theory recognised by in 's case(1) may well be one of the result of article 286 , (1) [1948] F.C.R. 1. ", "753 ", "But I am unable to think that the main purpose underlying each and every one of the provisions of article 286 was to prevent the continuance of preexisting chaotic conditions of multiple taxation by virtue of the nexus theory. I cannot help feeling that a wholly wrong impression of the pre- existing state of law in this respect has been created by overlooking that the existence of goods in a particular State has been taken as a taxing point only if that existence was at the crucial moment of transfer of ownership. (A statement showing the definition of \" sale\" under each of the Sales-Tax Act s in operation just prior to the Constitution is appended-as Appendix I-for reference). I On the construction of article 286 , reference has also been made in the dissenting view to sub- article (3) of article 286 which runs as follows: ", "\"No law made by the of a State imposing, or authorising the imposition of, a tax on the sale or purchase of any such goods as have been declared by by law to be essential for the life of the community shall have effect unless it has been reserved for the consideration of the President and has received his assent\". With great respect, I am unable to see its bearing on the question at issue. It is a totally different kind of restriction from what sub-articles (1) and (2) bring about. While sub-articles (1) and (2) impose certain bans on taxation what sub- article (3) does is not to impose a ban at all but to impose a fetter in respect of taxation on sales of essential goods declared as such by the by requiring that before such a taxation-law can have any effect, it should be reserved for the consideration of the President and receive his assent. In this respect it is in line with what would happen if any other State legislation passed by that is presented to the Governor for his assent and be reserves the same for the consideration of the President. The only difference is that while in the latter the reservation for the President is optional, in the case of such essential goods the reservation is compulsory. Subject to this, even essential goods continue to be, in theory and by Constitution, taxable (by the States themselves) in respect of sales thereof. I am, therefore, unable to see the bearing of this provision on the construction of the other two provisions which bring about a total or contingent ban of taxation in respect of the sales to which they have reference. ", "There is one other matter which has been stressed or implied in the dissenting view and it is this. The assumption is that even a single point tax on a sale arising in the course of inter-State trade would be a burden on the freedom of inter-State trade and commerce guaranteed under the Constitution by article 301 which runs as follows: \"Subject to the other provisions of this Part, trade, commerce and intercourse throughout the territory of India shall be free\". ", "Now it is not disputed that a tax on a purely internal sale which occurs as a result of the transportation of goods from a manufacturing centre within the to a purchasing market within the same is clearly Permissible and not hit by anything in the Constitution. If a sale in that kind of trade can bear the tax and is not a burden on the freedom of trade, it is difficult to see why a single point tax on the same kind of sale where a boundary intervenes bet- ween the manufacturing centre and the consuming centre need be treated as a burden, especially where that tax is ultimately to come out of the residents of the very by which such sale is taxable. Freedom of trade and commerce applies as much within a as outside it. It appears to me again, with great respect, that there is no warrant for treating such a tax as in any way contrary either to the letter or the spirit of the freedom of trade, commerce and intercourse provided under article 301. ", "For all the above reasons', I am quite clear in my mind that the view taken in the prior decision, viz., that the consuming State has the present power to tax a fictional inside sale which falls within the scope of the Explanation and that the said power is not affected by article 286(2) and that article 286(2) cannot be construed as overriding article 286 (1) (a) read with the Explanation, is correct and that there is no reason to depart from that decision. ", "The real difficulty, if any, that arises from this view is as regards what has been called the extraterrestrial operation of the tax which such a view may involve. In the conclusion reached by my learned brothers who are prepared to uphold the dissenting, view taken in the prior decision that question does not arise for consideration and has, been left untouched. I do not, therefore, feel called upon to go into it or to commit myself to any particular view on this somewhat difficult, question. I am doubtful whether, as between the component s of a of the kind, which India is under the Constitution, there can be any question of extra-territoriality. in the sense of the doctrine that one nation does not act in aid of the revenue laws of another (and foreign) nation. It is true that a defined geographical part of India constitutes the territory of each unit called the and that the governance of that unit is committed to that . But it appears to me that on that account, the territory of one is not a foreign territory in respect of another , when freedom of movement and a number of other common fundamental rights are guaranteed. On the other hand, I think it permissible to suggest that where the various s owe their existence to the same Constitution and are subject to its common operation, any taxing power vested in an individual must carry with it the incidental implication of enforceability, if need be, in any other within the when the very nature of that tax,, as contemplated by the Constitution involves it. In this context article 261 (1 ), which enjoins that full faith and credit shall be given throughout the territory of India to public acts, records and judicial proceedings of the and of every , may well be relied upon to justify such a view. I am aware that this has been generally taken as applicable to judicial and legislative proceedings. But- the language of the article is capable of wider application. I do not, however, wish to go into the, matter further because even if in the course of the administration of sales-tax, of the kind permissible, in the view of article 286 which the prior decision has accepted, there emerges the element of extra-territorial operation of such a tax, that by itself can be no reason for negativing the construction of articles 286(1) and (2) above indicated. In this context it is necessary to bear in mind the following clear dictum of in v. The King(1): \"A legislature which passes a law having extraterritorial operation may find that what it has enacted cannot be directly enforced, but the Act is not invalid on that account, and the courts of its country must enforce the law with the machinery available to them\". ", "The question, therefore, of extra-territoriality is not germane for construction of article 286. ", "At the present stage we are not concerned with the enforcement of the levy of the assessed tax but with the assessment of the tax. All that we are concerned with is the validity of the steps so far taken by the assessment authorities and particularly of the notice dated the 29th May, 1952, which intimates that on non-compliance before the 14th June, 1952, proceedings for assessment on the basis of \"best judgment\" will be made. That step, to my mind, is perfectly valid as appears from the following. In v. (1), by a majority held that where a tax was leviable on a non- resident, a requisition served upon him by post to file a return and to produce accounts was valid so as to entitle the taxing authority to make an assessment on the basis of best judgment on non-compliance with the requisition. The following passage from Lord 's speech at page 56 is instructive: ", "\"There is a second question in the case-namely, whether the appellant has been duly brought within the machinery for assessment provided by the Act. This turns upon section 7 . There was sent to the appellant by post addressed to him in the United (1)A.C.527,542. ", "(2) [1926] A.C. 87. ", "757 ", "States a notice under section 7 , sub- section 2 , requiring him to make a return. It is contended that there 'was no right to post him such a notice so addressed. The case, it is contended, is similar to the case of service of a writ out of the jurisdiction. I do not agree. It is similar rather to the service of a notice of dishonour of a bill or of a notice to quit or of a notice requiring payment of calls upon shares as a preliminary to forfeiture in default of payment. It is not a step in judicial proceeding but a step which will create inter-partes a state of things in which judicial proceedings can subsequently be taken in default of compliance\". ", "It may be that some or all of the provisions in the Bihar Act which contemplate enforcement out of or create penalties for non-compliance out of may require closer examination when the validity thereof is directly challenged. It may also be that the harassment consequent on such outside operation may require to be remedied either by agreed co-ordination between the s or by appropriate legislation, if need be. These, however, are not relevant considerations for us on the question we have now to deal with. ", "I am accordingly clear in my opinion that this appeal should be dismissed with costs. ", "APPENDIX-1. ", "STATEMENT SHOWING THE DEFINITION OF \"SALE\" UNDER EACH OF THE SALES-TAX ACTS IN OPERATION JUST PRIOR TO THE COMMENCEMENT OF THE CONSTITUTION. ", "(Vide Page 753). ", "MADRAS SALES-TAX ACT, 1939. ", "\"Sale\" (with all its grammatical variations and cognate expressions) means every transfer of the property in goods by one person to another in the course of trade or business for cash or for deferred payment or other valuable consideration, (and includes also a transfer of property in goods involved in the execu- ", "758 ", "tion of a works contract, but does not include a mortgage, hypothecation, charge or pledge;) (Explanation 1: A transfer of goods on the hirepurchase or other instalment system of payment shall, notwithstanding the fact that the seller retains the title in the goods as security for payment of the price, be deemed to be a sale.) Explanation 2: Notwithstanding anything to the contrary in the Indian Sale of Goods Act , 1930, the sale or purchase of any goods shall be deemed, for the purposes of this Act, to have taken place in this Province, wherever the contract of sale or purchase might have been made- ", "(a)if the goods were actually in this Province at the time when the contract of sale or purchase in respect thereof was made, or ", "(b)in case the contract was for the sale or purchase of future goods by description, then, if the goods are actually produced in this Province at any time after the contract of sale or purchase in respect thereof was made. BENGAL FINANCE (SALES-TAX) ACT, 1941. ", "\"Sale\" means any transfer of property in goods for cash or deferred payment or other valuable consideration ration.... Explanation 2: Notwithstanding anything to the contrary in the Indian Sale of Goods Act , 1930, the sale of any goods which are actually in West Bengal at the time when the contract of sale (as defined in that Act) in respect thereof is made, shall, wherever the said contract of sale is made, be deemed for the purposes of this Act to have taken place in West Bengal. ", "BOMBAY SALES-TAX ACT, 1946. ", "\"Sale\" means any transfer of property in goods for cash or deferred payment or other valuable consideration........... ", " ", "Explanation 2: Notwithstanding anything to the contrary in the Indian Sale of Goods Set, 1930, the sale of any goods which are actually in the Province of Bombay at the time when the contract for sale (as defined in that Act) is made in respect thereof, shall, wherever the said contract of sale is made, be deemed for the purposes of this Act to have taken place in the Province of Bombay. ", "ASSAM SALES-TAX ACT, 1947. ", "\"Sale\" means any transfer of property in goods by any person for cash or deferred payment or other valuable consideration * * * * Explanation: Notwitbstanding anything to the contrary in the Indian Sale of Goods Act , 1930, the sale of any goods which are actually in the Province at the time when the contract of sale (as defined in that Act) in respect thereof is made, shall, irrespective of the place where the said contract is made, be deemed for the purposes of this Act to have taken place in the Province. ", "BIHAR SALES-TAX ACT, 1947. ", "\"sale\" means * * * any transfer of property in goods for cash or deferred payment or other valuable consideration.... ", "* * * * * * Provided further that notwithstanding anything to the contrary in the Indian Sale of Goods Act , 1930, the sale of any goods- ", "(i) which are actually in Bihar at the time when, in respect thereof, the cntract of sale as defined in section 4 of that Act is made, or ", "(ii) which are produced or manufactured in Bihar by the producer or manufacturer thereof, shall, wherever the delivery of contract of sale is made, be deemed for the purposes of this Act to have taken place in Bihar; Provided further that the sale of goods in respect of a forward contract, whether goods under such con- ", "760 ", "tract are actually delivered or not, shall be deemed to have taken place on the date originally agreed upon for delivery. CENTRAL PROVINCES AND BERAR SALES-TAX ACT, 1947. \"Sale means any transfer of property in goods for cash or deferred payment or other valuable consideration * * * * * * Explanation 2: Notwithstanding anything to the contrary in the Indian Sale of Goods Act , 1930, the sale of any goods which are actually in the Central Provinces and Berar at the time when the contract of sale as defined in that Act in respect thereof is made, shall wherever the said contract of sale is made, be deemed for the purpose of this Act to have taken place in the Central Provinces and Berar. ORISSA SALES-TAX ACT, 1947. ", "\"Sale\" means any transfer of property in goods for cash or deferred payment or other valuable consideration........... ", "* * * * Provided further that notwithstanding anything to the contrary in the Indian Sale of Goods Act , 1930, the sale of any goods which are actually in Orissa at the time when, in respect thereof, the contract of sale as defined in section 4 of that Act is made, shall, wherever the said contract of sale is made, be deemed for the purpose of this Act to have taken place in Orissa. ", ", 1948. ", "\"Sale\" means every transfer of the property in goods by one person to another in the course of trade or business for cash or deferred payment or other valuable consideration.... ", "* * * * * the Sale of Goods Act , 1932, the sale or purchase of any goods shall be deemed, for the purposes of this Act, to have taken place in Mysore, wherever the contract of sale might have been made; ", "(a) if the goods were actually in Mysore at the time when the contract of sale or purchase in respect there of was made, or ", "(b)in case the contract was for the sale or purchase of future goods by description, then, if the goods are actually produced in Mysore at any time after the contract of sale or purchase in respect thereof was made. EAST PUNJAB GENERAL SALES-TAX ACT, 1948. ", "\"Sale\" means any transfer of property in goods for cash or deferred payment or other valuable consideration......... Explanation 2: Notwithstanding anything to the contrary in the Indian Sale of Goods Act , 1930, the sale of any goods which are actually in East Punjab at the time when the contract of sale (as defined in that Act) in respect thereof is made, shall, wherever the said contract of sale is made, be deemed for the purposes of this Act to -have taken place in East Punjab. ", "UNITED PROVINCES SALES-TAX ACT, 1948. ", "\"Sale\" means any transfer of property in goods for cash or deferred payment or other valuable consideration Explanation II: Notwithstanding anything in the Indian Sale of Goods Act , 1930, or any other law for the time being in force, the sale of any goods- ", "(i) which are actually in the United Provinces at the time when in respect thereof, the contract of sale as defined in section 4 of that Act is made, or ", "(ii)which are produced or manufactured in the United Provinces by the producer or manufacturer thereof, shall, wherever the delivery or conttact of sale is made, be deemed for the purposes of this Act to have taken place in the United Provinces. ", "Explanation 111. Where goods under a forward contract are not actually delivered, the sale in respect of such contract shall be deemed to have been completed on the date originally agreed upon for delivery. ", "Note: The omitted portions in the definitions other than those in the Madras Act are to the same effect as those shown within brackets in the Madras definition. appellant is a Company registered under the Indian Companies Act carrying on business in the manufacture and sale of sera, biological products and medicines. Its registered office is at No. 153, Dharamtalla Street, Calcutta, and its laboratory and factory are situated at Baranagar, 24 Parganas, West Bengal. The first respondent is the State of Bihar, and respondents 2 and 3 are respectively the Secretary and the Assistant Secretary of . On the 18th December 1951, the second respondent issued a notice under section 13(5) of the Bihar Sales Tax Act, 1947 (Act XIX of 1947) (hereinafter referred to as the Act) calling upon the appellant to register itself as a dealer under the Act and to submit a return for assessment of sales tax., To this the appellant sent a reply on the 8th January, 1952 disputing its liability on various grounds, and after further correspondence between the parties which it is needless to set out,, the third respondent sent a notice on the 20th May 1952 that if the appellant failed to comply with the notice dated the 18th December 1951 by the 14th June 1952, steps would-be I taken to assess tax on the basis of best judgment. The appellant replied by filing the application out of which the present appeal arises, under article 226 of the Constitution for a writ of prohibition restraining the respondents from proceeding with the assessment. It was alleged in the petition that as the appellant had no place of business within the State of Bihar, the provisions of the Act under which it was sought to be taxed were ultra vires as extraterritorial in operation, and that further those provisions were repugnant to article 286(2) of the Constitution and were therefore void. The State of Bihar, which will hereafter be referred to as the respondent, resisted the application on the ground firstly, that it was not maintainable for the reason that the appellant had, under the provisions of the Act, a right of appeal against the assessment to the appropriate authorities, and secondly, that as the sales proposed to be taxed must be deemed to have taken place by reason of the Explanation to article 286(1) (a) within Bihar, the provisions of the Act imposing tax on a non-resident seller were neither ultra vires nor unconstitutional. The learned Judges of upheld both these contentions and dismissed the application, and this appeal has been preferred against their judgment on a certificate granted under article 132(1) of the Constitution. In view of the importance of the issues involved, leave of the was sought by and granted to ten States, one commercial firm and one individual dealer. Nine out of the ten States, namely Orissa, PEPSU, Punjab, Madhya Pradesh, Madras, Mysore, Rajasthan, Travancore-Cochin and Uttar Pradesh, have intervened and supported the respondents. One State, West Bengal, represented by the learned Attorney-General supported the appellant, and so did , and one . ", "On the arguments addressed before us, the following points arise for determination: ", "1.Whether the application for a writ of prohibition is maintainable? ", "2.Whether the Explanation to article 286(1)(a) confers authority on to impose tax on sales falling within its purview? ", "3.Whether the sales covered by the Explanation to article 286(1) (a) are subject to the prohibition contained in article 286(2)? ", "97 ", "764 ", "4.Whether the Bihar Sales Tax Act, 1947 is invalid on the ground that it is extra-territorial in its operation, and ultra vires the power of ? ", "5.Whether the assessment proposed to be made on the appellant is not authorised by the Explanation to article 286(1) (a)? ", "1. On the question of the maintainability of the application for a writ of prohibition, it was observed by the learned Judges that under section 13(5) of the impugned Act, the Commissioner was competent to decide whether the appellant was a person liable to pay tax under the Act, that even if he came to an erroneous conclusion on the merits, that did not affect his jurisdiction over the subject- matter, that the Act itself provided in sections 24 and 25 a complete and effective machinery by way of appeal and revision for correction of such errors, and that accordingly a writ of prohibition was not the proper remedy. If the learned Judges intended to lay down that a writ of prohibition should not issue because another remedy was open under the Act, that cannot be supported. The existence of another remedy is a very material circumstance to be taken into account when the is called upon to issue a writ of certiorari, but wholly different considerations arise when the writ asked for is prohibition. Writ of prohibition is issued whenever a subordinate or usurps jurisdiction which does not belong to it, and when that has been shown, the issue of the writ, though not of course, is of right and not discretionary. The point to be determined, therefore, is whether in taking proceedings under section 13(5) of the Act, respondents 2 and 3 acted without jurisdiction or in excess of it. The contention of the appellant is that had no competence to tax the sales in question, because they were effected in Bengal, and the appellant was not carrying on business within the of Bihar. If this contention is well- founded, then section 13(5) of the Act would be void and inoperative in its application as against the appellant, and the proceedings taken thereunder would in consequence be without jurisdiction. We are not here concerned with a statute whose vires is not in question, and which confers jurisdiction on any authority to take proceedings if certain facts exist and the enquiry directed by the authority is as to whether those facts exist. The determination in such a case is incidental to the effective exercise by the authority of its undisputed jurisdiction and if, as a result of that enquiry, it came to an erroneous conclusion, there is no error of jurisdiction, and it might well be contended in that case that the remedy of the party aggrieved was to resort to the machinery provided in the statute itself by way of appeal or revision, and that a writ of prohibition would be misconceived. But here, the contention of the appellant is that the statute itself is void in so far as it authorises the imposition of a tax on dealers who are not residents within the or do not carry on business there, and that, in consequence, the proceedings taken under section 13(5) of the Act should be restrained on the ground of want of jurisdiction. It is no answer to this contention that the appellant should seek redress through the channels provided in the Act therefor. Indeed, the contention that the Act is ultra vires is not one which the s constituted under the Act, whether original, appellate, or revisional, could entertain,, their duty being merely to administer the Act. ", "It was argued by Mr. that if the tax was illegal, as contended by the appellant, then the proceedings taken for imposing the same would amount to unconstitutional interference with the fundamental right of the appellant to carry on business guaranteed under article 19(1) (g ), and that the courts were bound to interfere under article 226. He relied on the decisions of this court in v. , Jalalabad(1), .(\"), and (3). That is undoubtedly the position in law, but as the appellant is a Company registered under (1) S.C.R. 578. (2) S.C.R. 1069, (3) S.C.R. 1122. ", "766 ", "the Indian Companies Act and the question whether a juristic person is a citizen for the purpose of article 19(1) (g) is still an open one, I would prefer not to rest my decision on this ground. It is sufficient for the purpose of this appeal to hold that a writ of prohibition should issue, if the appellant establishes that the proceedings taken against it under section 13(5) of the Act are without jurisdiction. The contentions urged in support of that position must now be examined. ", "2. It is firstly argued that the Explanation to article 286 (1) (a) on which the validity of the impugned Act depends confers no authority on to impose a tax on sales falling within its purview. To appreciate the contentions advanced on either side, it must be mentioned that the Act as passed in 1947 contemplated the imposition of a tax on residents within the . They might be natural persons, or they might be juristic persons carrying on business within the . The business might be carried on in person or through agents. But if the persons who carried on the business of buying and selling did not reside within the or carry on business there, then the Act did not authorise the imposition of tax on them. That was the effect of the definition of \"dealer\" as meaning \"any person who carries on the business of selling or buying goods in Bihar\". Then came the Constitution, and the Explanation to article 286(1) (a) enacted that sales shall be deemed to have taken place in that in which the goods are delivered for consumption, notwithstanding that title to them passed in another . The construction which the respondent puts on the Explanation is that it confers on the s proprio vigore, a power to tax sales when the conditions mentioned therein are satisfied. Agreeably to this view, the Bihar Finance Act, 1950 (Act XVII of 1950) substituted for the words \"who carries on business of selling or buying goods in Bihar\" the word$ \"who sells or supplies any goods\". The point to be noted is that the words \"in Bihar\" which occurred in the previous definition were omitted, In 1951 by the Adaptation of Laws Order, a new section, section 33 , was added, and that is as follows: ", "\"33. (1) Notwithstanding anything contained in this Act, ", "(a) a tax on the sale or purchase of goods shall not be imposed under this Act- ", "(i) where such sale or purchase takes place outside the State of Bihar; or ", "(ii) where such sale or purchase takes place in the course of import of the goods into, or export of the goods out of, the territory of India; ", "(b) a tax on the sale or purchase -of any goods shall not, after the 31st day of March 1951, be Imposed where such sale or purchase takes place in the course of inter-State trade or commerce except in so far as may by law otherwise provide. ", "(2) The Explanation to clause (1) of article 286 of the Constitution shall apply for the interpretation of sub- clause (1) of clause (a) of sub-section (1)\". (2) The contention of the respondent is that the appel- lant has become liable to be taxed under these provisions. The appellant replies that article 286(1) (a) is restrictive in its scope, that it merely takes away a power to tax which the might otherwise possess, but that it does not positively confer on a a power to tax where it did not previously exist, and that on its true construction, it would operate to divest Bengal of its power to tax but not to vest it in Bihar. To decide which of these two contentions is the correct one, it is necessary to examine what the law was prior to the enactment of article 286(1) ", "(a) and the Explanation, what the defect was which was disclosed in the working of that law, and how it was proposed to remedy it. ", "Under the Government of India Act, 1935, the power to enact a law imposing tax on sale of goods was conferred on by Entry 48 in List II. Under sections 99(1) and 100(3) that law must be for the Province, and as interpreted in 1. T. Commissioner, Bombay(1), that meant that there should be sufficient territorial (1) (1948] F.C.R. I., connection between the person proposed to be taxed and the seeking to tax with reference to the subject matter of the taxation. Dealing with this aspect of the matter, , C. J. observed in .(1) as follows: \"The expression 'for such or any part thereof' cannot, in our view, be taken to import into Entry 54 the restriction that the sale or purchase referred to must take place within the territory of that . All that it means is that the laws which a is empowered to make must be for the purposes of that .................................... In the case of sales-tax it is not necessary that the sale or purchase should take place within the territorial limits of the in the sense that all the ingredients of a sale like the agreement to sell, the passing of title, delivery of the goods, etc. should have a territorial connection with the . Broadly speaking, local activities of buying and selling carried on in the in relation to local goods would be a sufficient basis to sustain the taxing power of the , provided of course, such activities ultimately resulted in a concluded sale or purchase to be taxed\". This statement of the law was again adopted by this Court in (2) . Vide the observations of , J. (as he then was) at pages 682 and 683. In this view, a law of the imposing a tax on sales must, to be valid, fulfill two conditions. Firstly, there must be a completed sale involving the transfer of title in the goods to the purchaser. It is only then that the power to tax arises. That was held by this Court in (1). Secondly, there must be sufficient territorial nexus between the transaction and the which seeks to tax it. This condition undoubtedly introduced an element of uncertainty and vagueness in the law with the result that the power to tax which was linked up with it, had indefiniteness which could ].end itself to (1) S.C.R. 1069. (2) S.C.R, 677. (3) 1 S.C.R. 243, abuse. How expansive was the area open to the Legislature to impose a tax on the basis of the nexus theory is forcibly brought out by , J. in the following observations in .(1) at page 1101: ", "\"The difficulty is apparent when one begins to split a sale into its component parts and analyse them. When this is done, a sale is found to consist of a number of ingredients which can be said to be essential in the sense that if any one of them is missing there is no sale. The following are some of them: (1) the existence of goods which form the subject-matter of the sale, (2) the bargain or contract which, when executed., will result in the passing of the property in the goods for a price, (3) the payment, or promise of payment, of a price, (4) the passing of the title. When all take place in one State, there is no difficulty. The situs of the sale is the place in which all the ingredients are brought into being. But when one or more ingredients take place in different States, what criterion is one to employ? It is impossible to say that any of these ingredients is more essential than any other because the result is always the same the moment you take one away. There is then no sale\". ", "Many were the problems which this state of the law created both for the and for the consumers. Whether the fact on which a law seeks to tax is sufficient nexus must, except in some obvious cases, be open to debate, and until a court pronounces on it, there must be a cloud of uncertainty hanging over the validity of the enactment. More than that, when the several elements which go to make up a sale are distributed over different s it might happen that the same transaction might be subjected to tax by more s than one and the burden thereof must ultimately fall on the consumers. It was this, the possibility of multiple taxation that was the most serious defect in the law as it stood prior to the Constitution, and it was to remedy this that a new provision., article 286(1)(a) with its Explanation was (1) S.C.R. 1069. ", "770 ", "enacted. It is as follows: ", "\"286. (1) No law of a State shall impose, or authorise the imposition of, a tax on the sale or purchase of goods where such sale or purchase takes place- ", "(a) outside the State. ", "Explanation.-For the purposes of sub-clause (a), a sale or purchase shall be deemed to have taken place in the State in which the goods have actually been delivered as a direct result of such sale or purchase for the purpose of consumption in that State, notwithstanding the fact that under the general law relating to sale of goods the property in the goods has by reason of such sale or purchase passed in another State\". ", "It will be convenient hereafter to refer to the State in which title to the goods passes as the selling State, and the State in which goods are delivered for consumption as the delivery State. ", "Now we may examine how this provision is designed to put an end to multiple taxation. The scheme of the enactment is to fix, what had not been done under the Government of India Act, 1935, the situs of the sale, and for that purpose, to classify it into two categories, sale inside the and sale outside the . On what principle the situs was fixed will presently be considered. But when once that is done, the problem is solved. If a sale is inside a , the power of that to tax it under Entry 54 remains unaffected. But if the sale is outside a , article 286(1) (a) prohibits that from taxing it. This process must have the effect of eliminating multiple taxation, because a sale must be either inside or outside a , and if it is inside one it must be outside all other s. In this respect, article 286(1) (a) effected a fundamental alteration in the law under Entry 48 in List II and section 100(3) of the Government of India Act, 1935, as construed by the courts. Whereas under these provisions a could tax irrespective of where a sale took place, provided there was sufficient territorial nexus, under article 286(1) (a) that power can be exercised only when it takes place inside the , mere nexi being insufficient to support such a power. The theory of nexus as a source of jurisdiction to tax was thus abandoned, and the power to tax was annexed to the situs of the sale to be exercised by the wherein it is fixed and as a given sale can take place only in one and in no other, it must follow that the power of taxing that sale is capable of exercise only by one and not others. ", "The foundation on which this scheme rests is the location of a sale in a particular . But how is this to be done? When all the essential elements of a sale take place within one , the question presents no difficulty. But what, if they are distributed over several s? It is to deal with this situation that the Explanation has been enacted. Its purpose is to fix the situs of a sale when it is of an character,, and it does that by providing that it shall be deemed to have taken place in that in which the goods are delivered for consumption. What the significance of the words \" for consumption\" is, will be considered in due course. But that apart, it is delivery of the goods that has been adopted by the Constitution as the determining factor in fixing the situs of the sale, not the agreement to sell, nor the passing of title to the goods, nor other ingredients of sale, and there is good reason for this. Where an agreement to sell is concluded by correspondence as generally it must be when the transaction is of an character., difficult questions might crop up as to where the agreement was concluded. Likewise, the conception as to passing of property in the goods is largely juristic and not seldom obscured by legal subtleties and refinements, and it is conceivable that there might be conflict among the s as to in which of them the title has passed. ]But delivery is a matter of fact, about which there ought to be no dispute, and it is consistent with the purpose of article 286(1)(a) that the Explanation should have chosen delivery as the determining element in the transaction of sale. Now, the question to be decided ,is whether in the light of the above discussion, the contention of the appellant that the Explanation operates only to deprive the selling of its power to tax the sale, and that it confers no authority on the delivery to impose a tax can be accepted. An obvious objection to this view might at once be stated. If the Explanation has no application to any but the selling , it must follow that all the other s including the delivery will have power to impose a tax under Entry 54 uncontrolled by the Explanation, and that will bring into play the nexus theory with its attendant evil of multiple taxation. On this contention, therefore, article 286 (1) (a) must be held to have failed to achieve what it set about to do. A construction which leads to such a conclusion cannot be accepted unless there are cogent reasons therefor. What are those reasons? It is urged that article 286 (1) (a) does not, in terms, purport to confer a power on the to impose a tax on sale, that, on the other hand, it assumes the pre-existence of such a power in the , and then proceeds to restrict it, that the substantive provisions which confer power to tax are Entry 54 in List II and article 246(3 ), that when a has no power to tax under those provisions, then article 286(1) (a) could have no application as there could be no question of restricting what does not exist, and that it could not, therefore, operate to confer on it such a power. In support of this position, reliance is placed on the form of article 286(1) ", "(a) that no law of a State shall impose a tax on outside sale. This prescription, it is argued, is merely negative and destructive and not positive and creative in its content. ", "But this contention does not give sufficient effect to the Explanation which is in substance and form positive, and it also fails to take adequately into consideration the purpose of the enactment. The object of article 286(1)(a)- and there is no dispute about it -is to avoid multiple taxation and that, as already stated, was sought to be achieved by fixing the situs of sale in one in accordance with the Explanation. The scheme of the enactment must, by its very nature, have both a positive and a negative aspect. In so far as it lays down which of the several s could tax-and it does that in the Explanation -it is positive in its aspect, and in so far as it prohibits the other s from imposing tax-and it does this in the body of article 286(1)(a)- it is negative in its aspect. The body of article 286(1) (a) and the Explanation together form parts of a single enactment charged with a single purpose and to refer to it either as negative or positive in character can only be a partial and not an accurate statement of the true position. It is no doubt true that article 286 (1) (a) assumes that there is in the a power to tax aliunde, and then proceeds to restrict it. But it is not inconsistent with this to construe the Explanation as positive in character. The problem of multiple taxation, which it is the object of the enactment to avoid, is possible only when the sale is of an inter character, and when the Explanation enacts that in such cases the sale shall be deemed to have taken place in the delivery , that is at once a recognition and a declaration by the Constitution that delivery is sufficient nexus on which the can tax the sale under Entry 54. The object of this declaration was to remove the question from the arena of controversy and settle it once and for all. It is thus a positive enactment and not the less so, because it is declaratory in character and it is also restrictive in that it takes away by necessary implication the power of taxation on the basis of other nexi which other s would have had under Entry 54. No purpose would be served by entering into a subtle disputation as to whether the Explanation conferred a new and substantive power, or whether it affirmed an existing power. In either case, the power of the delivery to tax could not be challenged. ", "Looking at the form of the Explanation, it is emphatically positive in that it declares that the sale shall be deemed to have taken place in the delivery State, and that is all the more significant in view of the fact that the body of article 286(1) (a) to which it is appended is negative in form. The change over from the negative of the body of article 286(1)(a) to the positive of the Explanation is highly significant, and the appellant has been unable to suggest any reason for this, except inadvertence and slovenliness on the part of the draftsman. ", "The marginal note to article 286 was also referred to as showing that the Explanation was merely restrictive in character. In v. ) Lord observed: ", "\"It is well settled that marginal notes to the sections of an Act of Parliament cannot be referred to for the purpose of construing the Act. The contrary opinion originated in a mistake, and it has been exploded long ago. There seems to be no reason for giving the marginal notes in an Indian statute any greater authority than the marginal notes in an English Act of Parliament\". ", "The reason on which this rule rests was thus stated by , L. J. in Attorney-General v. . (2): \"I never knew an amendment set down or discussed upon marginal notes to a clause. has nothing to do with a marginal note\". Vide also the observations of Lord , M.R., in v.Attorney- General(3). This reasoning applies with equal force to marginal notes in Indian statutes. In my opinion, the marginal note to article 286(1)(a) cannot be referred to for construing the Explanation. It is clearly inadmissible for cutting down the plain meaning of the words of the Constitu- tion. .(4). ", "Two other views as to the scope of the Explanation which were discussed by the learned Attorney-General in the course of his argument must now be noticed. One is that the Explanation does not deprive the selling of its power to tax under Entry 54 but confers additional power of taxation on the delivery . And the other is that the Explanation merely settles the competing claims of the selling and of the delivery , and leaves untouched the power of the (1) 31 I.A,. 132, 142, 143. ", "(3) [1930] 1 Ch. 666, 593. ", "(2) [1879] 11 Ch. D. 449 461. ", "(4) [1950] S.C.R. 835, 353. ", "775 ", "other s to tax on the basis of the nexus theory. Neither of these views has been pressed by any of the parties before us, and both of them are open to the objection that they would result in multiple taxation, which it was the purpose of the Explanation to avoid, and must in consequence be rejected. In the result, 7 whether regard is had to the object of the enactment or its language, the Explanation must be held to authorise the imposition of tax by the delivery . ", "3. It is next contended by the appellant that the sales covered by the Explanation to article 286(1)(a) are within the prohibition contained in article 286(2) and that in consequence the charge sought to be imposed on such sales by the impugned Act is illegal and void. That raises the question as to what the scope of the Explanation to article 286(1) (a) is, and whether it is controlled by article 286(2). The Explanation declaring as it does that the situs of a sale for purposes of taxation is the delivery and not the selling can apply, by its very terms, only to sales of an inter- character, and that is the basis on which the argument of both the parties to the appeal has proceeded. Article 286(2) prohibits the imposition of tax on sales in the course of inter- trade. Thus, the field on which the Explanation operates falls within the area covered by article 286(2 ), and there is apparently a conflict between them. Now the question is how the power of a to tax on the basis of the Explanation is affected by the impact of article 286(2 ), and on that, three views have been put forward: ", "(a) The Explanation fixes the situs of the sale in the delivery State. It becomes thereby a sale inside that State and outside all other States. It accordingly ceases to be a sale in the course of inter-State trade and becomes an intrastate sale and is, therefore, outside the purview of article 286(2); and the power of the delivery State to tax under the Explanation remains unaffected. That was the view taken by the majority of the learned Judges in . (1), and according (1) B.C.R 1069. ", "776 ", "to it, there is no conflict between the Explanation and article 286(2). ", "(b) The sales to which the Explanation applies are in the course of trade, and fall within the coverage of article 286(2 ), and there is thus a conflict between the two provisions, but the Explanation deals with a special topic, and therefore prevails against article 286(2) on the principle of generalia specialisus non derogant, and the power to tax thereunder is unaffected. That was the view taken by , J. in .(1). ", "(c)The sales to which the Explanation applies are in the course of inter-State trade, and are hit by article 286(2) and unless lifts the ban as provided therein, no tax can be levied on them. According to this view, the two provisions are irreconcilably in conflict, and article 286(2) must prevail as against the Explanation unless its operation is superseded by ary legislation. This was the view taken by , J. in .(1), and by , J. in (2). The points for determination are thus whether there is conflict between the Explanation to article 286(1)(a) and article 286(2 ), and if so, which of them is to prevail. To decide this, it is necessary to examine first what the position was under the Government of India Act, 1935, and next how it has been affected by the, provisions of the Constitution. ", "Under the Government of India Act, 1935, the Provinces had under Entry 48 in List II the exclusive power to make laws in respect of taxes on sale of goods, and under Entry 27, in respect of trade and commerce within its territory. There was no entry relating to trade and commerce among the Provinces though several topics relating to inter-State trade and commerce were specifically enumerated in List 1. Nor was there any provision for regulating inter-State com- merce though under section 297 some restrictions were placed on the powers of with (1) S.C.R. 1069. ", "(2) [1954] S.C.R. 53, reference thereto. The conception of a commerce clause, as we now have it, was unknown to the Government of India Act, 1935. It came in for the first time as part of the Constitution. To understand its true scope, it would be legitimate and indeed necessary to examine its bearings and incidents in other systems of law. The American Constitution is the oldest written Federal Constitution in the world, and the problems it had to deal with were what many Federal Governments have had since to face. The commerce clause is one of its notable provisions, and it was before the framers of the British North America Act, 1867 and of the Commonwealth Act of Australia, 1900. Our Constitution also has largely been influenced by it, and it would be useful to examine it to see what light it throws on the present controversy. ", "In America the authority of the to enact laws on the matters delegated to it under the constitution is supreme. In respect of all other matters, the s possess plenary powers of legislation subject to the inhibition contained in the Constitution. It is in exercise of these powers that the s enact laws regulating sales and imposing tax on them. Under section 8 of article I of the Constitution, the power \"to regulate commerce among the s\" is vested in the . Thus, while commerce is within the exclusive jurisdiction of the ,, inter- commerce is within the exclusive jurisdiction of the . A question which came up frequently for decision before the s was whether the s had the power to enact laws with reference to goods which had come into a in the course of inter- trade, and it was settled on the highest authority that if the sale was for the purposes of consumption within the it became domestic in its character,, and fell within the power of the to regulate and to tax, but that if it was for purposes other than consumption such as re-sale, then that was in the course of inter commerce, and alone had the jurisdiction to legislate in respect of it. In v. ) the question was as to the validity of a statute of New York regulating the rates which could be charged for sale of natural gas for consumption within the . The gas was transported into the by pipe lines from outside, and it was accordingly held that the regulation was in respect of inter- trade and commerce, and was therefore \"subject to applicable Constitutional limitations\" but that the law was valid because \"the thing which the Commission has undertaken to regulate, while part of inter- transmission, is local in its nature, and pertains to the furnishing of natural gas to local consumers within the city of Jamestown, in the of New York\". In Missouri ex rel. v. ), the facts were similar except that the sales were not for consumption within the but for resale. It was held that those sales continued to retain the character of inter- trade, and fell within the commerce clause. also v. ). The principle underlying these decisions would appear to be that goods which are transported in inter- trade must necessarily come to the end of their journey when they are consumed, and that, therefore, sales for consumption take them out of the course of inter- trade. But if the goods are sold for resale, they are still moving in inter- journey and therefore the commerce clause applies. In 1938 the enacted a legislation with reference to sales in the course of inter- trade for purposes of resale. Examining the question whether the s had thereafter the power to enact a law regulating sales which take place in the course of inter- trade but for local consumption, held in v. ) that they had, and observed: \"Prior to that time (1938) this in a series of decisions bad dealt with various situations arising from efforts to regulate the sale of imported (1) 252 U.S. 23: 64 L.Ed. 434. ", "(3) 273 U.S. 83; 71 L. Ed. 549. ", "(2) 265 U.S. 298; 68 L. Ed. 1027. ", "(4) 332 U.S. 507; 92 L. Ed. 128. ", "779 ", "natural gas. The story has been adequately told and we do not stop to review it again or attempt reconciliation of all the decisions or their groundings. Suffice it to say that by 1938 the had delineated broadly between the area of permissible state control and that in which the states could not intrude. The former included interstate direct sales to local consumers, the latter, service interstate to local distributing companies, for resale\". ", "It further held that, the legislation was itself a recognition of the distinction established by the decisions \"between sales for resale and direct sale for con'sumption. \"This decision was -followed quite recently in v. ). Four propositions might accordingly be taken as well-settled in American law: ", "(i)The States have plenary and exclusive power of legislation in respect of intrastate sales. ", "(ii)Regulation of inter-State commerce is a topic within the exclusive jurisdiction of the . ", "(iii)Sales which take place in the course of interState trade are local in character and within the jurisdiction of the State, if they are for consumption within the State. ", "(iv)Where such sales are for other purposes than consumption such as resale, they retain their character as sales in the course of inter-State trade and are within the exclusive jurisdiction of the . ", "The provisions of the Indian Constitution bearing on this subject may now be referred to:- ", "(a)The States have exclusive jurisdiction under Entry 54 to impose sales tax and under Entry 26 to regulate trade and commerce within the State. Legislative powers in respect of these matters were conferred on the Provinces by the Government of India Act, 1935, and these powers have been continued in the States by the Constitution. ", "(b) Article 301 enacts that trade and commerce within the territory of India shall be free, and under Entry 42 in List I, the power to legislate on interState trade and commerce is vested exclusively in the (1) 341 U.S. 329; 95 L. Ed. 993. ", "99 ", "780 ", ". There was nothing corresponding to, these provisions in the Government of India Act, 1935. ", "(c) Under the Explanation to article 286(1)(a ), a sale is deemed to take place within the State in which the goods are delivered for consumption. This again is a new provision introduced in the Constitution. ", "(d) No law of a can impose a tax on a sale which takes place in the course of inter- trade. That is article 286(2) which is also a new provision. Reading side by side the law on the subject both in America and under the Indian Constitution, it is difficult to avoid the conclusion that the Explanation to article 286(1) (a) and article 286(2) have been inspired by the American law on the subject, and that their spheres of operation correspond respectively to the jurisdiction of the and of the in America as delineated in Missouri ex rel. v. ), and v. ) . I shall now pass on to consider which of the three views which have been placed before us as to the effect of article 286(2) on the Explanation to article 286(1)(a) deserves to be accepted. The first view is that the sales falling within the Explanation are intra- in character, and are therefore outside the area covered by article 286(2). This derives considerable support from the language of the enactment. The scheme of article 286(1)(a) is, as already stated, that it fixes the situs of the sales with a view to avoid multiple taxation, and for that purpose it divides them into two categories-inside sales and outside -sales-and enacts that a cannot tax an outside ,-sale. When in the same context the Explanation declares that a sale in the course of inter- trade that this is its scope is common ground-must be deemed to have taken place in the in which the goods are delivered for consumption, its purpose is clearly to take it out of inter- trade and stamp it with the character of an intra- sale. Under Entry 26 in List II, it is the that has jurisdic- (1) 265 TT.S. 298; 68 L.Ed. 1027. ", "(2) 332 U.S. 507; 92 L. Ed. 128. ", "781 ", "tion in respect of trade and commerce within the State, and reading that with the language of the Explanation that the sales covered by it are deemed to take place in the State, the inference is irresistible that the intention of the Constitution-makers was to bring those sales within the exclusive jurisdiction of the 7 State for purposes of taxation under Entry 54. The result is that with reference to sales for local consumption made in the course of inter- State trade, the law under the Constitution is exactly what it is in America and indeed, the similarity is too striking to be merely accidental. The position may thus be summed up: Article 286(2) applies to sales in the course of inter- State trade. The sales which fall within the Explanation are intrastate sales. The grounds covered by the two provisions are distinct and separate. Each has operation within its own sphere, and there is no conflict between them. ", "The appellant resists this conclusion on several grounds, and they will now be considered. It was argued firstly that the conclusion that the Explanation and article 286(2) relate to two different subjects and that they operate on different fields could be reached only by importing the Explanation into article 286(2 ), and that could not be done because it is in terms stated to be \"for the purposes of subclause (a)\" and also because such a course could not be supported on any recognised rule of interpretation. Now, what is the significance of the words \"for the purposes of sub-clause(a)\" occurring in the Explanation? In the context, its purpose is only to exclude its application to article 286(1)(b). Article 286(1) deals with two matters, sales outside the and sales in the course of export and import. The former is dealt with in sub-clause (a) and the latter in sub-clause (b). If the intended that the Explanation should apply to the former and not to the latter, the most natural and obvious mode of expressing that intention would be to enact, as it has, that it is \"for the purposes of sub-clause (a)\". This problem would not have arisen if the two matters had been dealt with in two different clauses as logically they might have been. If that had been done, the article simplifying it, would run as follows: ", "\"286. (1) No law of a State shall impose a tax on a sale, where it takes place outside that State. Explanation:A sale shall be deemed to have taken place within that State where the goods are delivered for consumption as a direct result of the sale. ", "** * * * * ", "286. (4) No law of a State shall impose a tax on a sale in the course of export or import\". ", "Article 286(1) as drafted above, relegating sub-clause (b) to a separate clause and omitting the words \"for the purposes of sub-clause (a)\" in the Explanation would convey precisely the import of article 286(1) (a) as it now stands with sub-clause (b) and with the words\"for the purposes of sub-clause(a)\". That would clearly show that the force of the words \"for the purposes of sub-clause (a)\" becomes spent when article 286 (1) (b) is excluded from the operation of the Explanation. ", "But then, it is contended that whatever the form in which the Explanation may be couched, it could not be extended beyond article 286(1) (a) and projected into article 286(2 ), and that unless that was done, it was not possible to hold that the sales falling within the Explanation are taken out of the purview of article 286(2). In my opinion, this argument proceeds on a misconception of the real reasoning on which the conclusion that the Explanation and article 286 (2) relate to two different subjects is based. In view of the insistence with which this contention was pressed by the appellant, it seems desirable to examine the position in some detail. To start with, the two relevant provisions to be considered are article 286(1)(a) with the Explanation and article 286(2). Omitting what is not material, they would run as follows: ", "\"286. (1) No law of a State shall impose a tax on a sale, where it takes place outside that State. ", "Explanation: A sale in the course of inter-State trade is inside that State in which goods are actually delivered for consumption. ", "(2) No law of a State shall impose tax on a sale in the course of inter-State trade\". ", "The argument of the appellant that article 286(2) is comprehensive and includes all sales in the course of inter- State trade and that therefore the sales covered by the Explanation fall within its purview, takes into account only article 286(2) and the Explanation, and it would have been unassailable if the question had to be decided on a construction only of these two provisions. But that, however, is not the position. An explanation appended to a section or clause gets incorporated into it, and becomes an integral part of it, and has no independent existence apart from it. There is, in the eye of law, only one enactment, of which both the section and the Explanation are two inseparable parts. \"They move in a body if they move at all\". When, therefore, the question is whether sales falling within the Explanation are comprised within article 286(2 ), what has to be construed is that article in relation to, not merely the Explanation taken in isolation but to article 286(1) (a) read with the Explanation. If the matter is thus considered, the resultant position might thus be stated. Article 286(1) (a) confers on States power to tax sales inside their territory. Article 286(2) prohibits them from taxing sales in the course of inter-State trade. Explanation to article 286(1) (a) enacts that sales in the course of inter-State trade in which goods are delivered for consumption in a State shall be deemed to have taken place inside that State. The combined effect of all these provisions is that States can tax sales in the course of inter-State trade if they fall within the Explanation. This conclusion is reached, it will be seen, not by reading the Explanation into article 286 (2) as a sort of exception but giving to all the provisions the status of independent enactments and determining what, on a construction of the, language, their respective spheres of operation are. In this view, the argument that if the Explanation could be read into article 286(2) it might as well be read into article 286 (1) (b) and article 286 (3) does not call for consideration. As the question is one of determining on a reading of the entire article the precise operation of the several parts thereof, there can be no objection to examining the scope of article 286(1) including the Explanation in relation to article 286(1)(b) and article 286(3). Article 286(1) (a) relates to sales inside a State, and article 286(1)(b) to sales in the course of export from or import into the country, and there could not be any interaction between them, and that is made abundantly clear by the words \"for the purposes of sub-clause (a)\" in the Explanation. Likewise, reading article 286(1) (a) including the Explanation along with article 286 (3 ), the result is that the power to tax which the State otherwise possesses has to be exercised subject to the conditions mentioned in the latter, when there is a declaration thereunder. The impact of article 286(3) is, it should be noted, not confined to the Explanation but extends to the whole of article 286(1) (a). It operates not only on the inter-State sales falling within the Explanation but also on sales which are indisputably intrastate, and it controls both of them on the principle of generalia specialibus non derogant. ", "It is next contended that the sales to which the Explanation applies, takes place as a fact in the course of trade, and that the Explanation could not be construed as altering that fact, and that its true scope was merely to shift the situs of the sale from the selling to the delivery State. Conceiving interState trade as a stream flowing from point A in the selling State to a point B in the delivery State, it was argued that what the Explanation did was to shift the situs of the sale from point A to point B, that the stream was still there despite the shifting and that the sale therefore did not cease to be in the course of inter- State trade. With respect, the fallacy in this argument lies in thinking that after the shifting of the situs from point A to B; the sale could be regarded as one in the course of trade. A sale could be said to be in the course of trade only if two conditions concur: (1) A sale of goods, and (2) a transport of those goods from one State to another under the contract of sale. Unless both these conditions are satisfied, there can be no sale in the course of inter- State trade. Thus, if X, a merchant in State A goes to , purchases goods there and transports them into A, there is undoubtedly a movement of goods in commerce. But that is not under any contract of sale. X might be entitled under article 301 to certain rights in the matter of transportation. But article 286C2 ) has no application, as there is no sale in the course of interstate trade or commerce. In the same illustration, if X after transporting the goods into State A sells them, then also there is no sale in the course of trade. It is true that there is a sale, and there is also a movement of goods from one State to another. But that movement has not been under the sale, there having been no sale at the time of transportation. In on Constitutional Law (1939 Edition) sale in the course of commerce is thus defined: ", "\"The activities of buying and selling constitute inter-State commerce if the contracts therefor contemplate or necessarily involve the movement of goods in inter-State commerce\". ", "The law is thus stated by in \"Commerce Clause\" (1932 Edn.)-- ", "\"The dividing line between an interstate sale and intrastate sale is rather fine, although clear.. If the goods are shipped into a State without a previous sale, any sale within the State is commerce.................. Thus if the sale succeeds the transportation in point of time, however close, the state may license it\". In v. City of Covington(1), it was held that local sales of goods brought into the State from outside for the very purpose of the sale were not parts of inter-State commerce. The following observations at page 197 might be quoted: ", "\"Of course the transportation of plaintiffs' goods across the state line is of itself interState commerce; (1) 252 U S. 95 : 64 L.Ed. 157. ", "786 ", "but it is not this that is taxed by the city of Covington, nor is such commerce a part of the business that is taxed, or anything more than a preparation for it. So far as the itinerant vending is concerned the goods might just as well have been manufactured within the State of Kentucky; to the extent that plaintiffs dispose of their goods in that kind of sales, they make them the subject of local commerce; and this being so, they can claim no immunity from local regulation, whether the goods remain in original packages or not\". ", "In the light of the above principles, what is the legal character of the sales effected by the appellant and sought to be taxed by the respondent? There is firstly the fact that the goods were actually delivered in Bihar, and secondly, there is the fiction enacted by the Explanation that the sale had taken place not in Bengal but in Bihar. If both sale and delivery are in Bihar, it is difficult to see how the sale can be said to be in the course of inter- State trade. The argument of the appellant that there was, in fact, a movement of goods from Bengal to Bihar and that stood unaffected by the fictional shifting of the situs of the sale from Bengal to Bihar, overlooks that by this very shifting, the character and complexion of the sale become altered, because, as the sale follows the transport of goods, it cannot, according to the principles already stated, be said to be in the course of inter-State trade. It may be urged as against this conclusion that as the Explanation to article 286(1) (a) merely shifts the situs of the sales, and leaves unaffected the agreements to sell which must in the present case be held to have been made at Calcutta when the appellant executed the orders received from the Bihar purchasers, the transport of goods from Bengal to Bihar was under the above contracts to sell, and that therefore the sales were in the course of inter-State trade. Such a contention would be untenable, because the expression \"contract of sale\" in this context has the same meaning as the words \"contract of buying and selling\" I in the definition of inter-State commerce given by in the passage already quoted, and they both refer to the bargain resulting in the sale irrespective of whether it is in the stage of an agreement to sell, or whether it is a sale in which title to the goods has passed to the purchaser. That is also the definition of `contract of sale' in section 5(1) of the Indian Sale of Goods Act. As there can be only 2 one final and concluded bargain in respect of any particular sale, and as that is fixed by the Explanation at Bihar, it follows that there could not be any bargain with reference thereto in Calcutta, and the movement of goods from Bengal to Bihar was not under any contract of sale. The position in law is exactly the same as if the goods had been sent by the seller from Bengal to Bihar on his own account and then sold there and delivered to the purchaser, in which case it would be indistinguishable from v. City of Covington(1), and the sale would clearly be intrastate. This conclusion does not negative the factum of inter-State movement of goods, and does not prevent any rights being put forward on that footing under article 36-1. it only negatives the notion of a sale in the course of inter-State trade, and thus takes it out of the purview of article 286(2 ). ", "It was argued that the Explanation merely enacted a legal fiction, and that it being a well-established rule of construction that legal fictions should be limited to the purpose for which they are enacted, it would be contrary to this rule to hold that the Explanation not merely shifted the situs of the sale but also obliterated the course of commerce. But the conclusion that the sales covered by the Explanation cease to be in the course of trade is not the result of any extension of the fiction because, as already stated, the factum of inter- State transportation is not ignored. That is the legal consequence of the fictional shifting of the situs. it will be useful in this connection to quote what Lord ob- served in dealing with a similar contention in v. ). \"If you are bidden to treat an imaginary state of (1) 251 U.S. 95: 64 L. Ed. 157. ", "(2) 11952] A.C. 109, 132. ", "100 ", "788 ", "affairs as real, you must surely, unless prohibited from doing so, also imagine as real the consequences and incidents which, if the putative state of affairs had in fact existed, must inevitably have flowed from or ac- companied it. One of these in this case is emancipation from the 1939 level of rents. The statute says that you must imagine a certain state of affairs; it does not say that having done so, you must cause or permit your imagination to boggle when it comes to the inevitable corollaries of that state of affairs\". ", "It is next contended that the view that sales in which goods are delivered for consumption within the are not within article 286(2) would render that provision practically useless, because sales for purposes other than consumption such as for resale must be very few and negligible. Why should a seller for consumption, it is asked, get his goods from an intermediary and not directly from the manufacturer? But then, the Constitution has itself recognised in clear and unmistakable terms a distinction between sales in which goods are delivered for consumption and sales in which they are delivered for purposes other than consumption such as resale, and what purpose this distinction serves, the appellant has been unable to explain. Besides, what are the materials on which we can brush it aside on the ground that it is not one of substance? One of the developments of modern big business is the agency system under which middlemen enter into contracts with manufacturers, stipulate for monopoly of the distribution rights within a specified area, guarantee a certain volume of business, and are granted liberal commission on the sales. In such cases, retail sellers can get the goods only from the distributors, and even when there is no grant of monopoly, it is nothing unusual in business that large distributors are able to get the goods from the manufacturers on rates more favourable than retail sellers can obtain and that consequently, it is more economical for the latter to buy them from the distributors than from the manufacturers. And it is not without significance that the distinction between the two classes of sales has been recognised in com- ", " ", "mercially advanced America for now nearly a century and recognised for this very purpose; and how can such a distinction be characterised as unsubstantial? It was finally contended by the learned Attorney-General that if article 286(2) were to be construed as not comprehending sales falling within the Explanation., then there would be nothing on which it could operate. The argument was thus presented: Article 286(1)(a) bars the selling State, in the present case Bengal, from taxing the sale because by reason of the Explanation, it becomes an outside sale', and if article 286(2) is to be construed as not barring the delivery State, in the instant case Bihar, from taking the sale, then there is no sale to which it can apply, and it will serve no purpose. The error in this argument lies in taking the illustration as exhausting the entire range of trade. But that is not correct. Inter-State commerce consists in a flow of goods not merely from one State to another but in its continuous flow through several States, and article 286(2) is designed to protect such a flow without being burdened by State taxes. Thus, if A in Bengal sells to B in Bihar., and if in his turn B sells the same goods to C in U. P. for local consumption, there will be interState commerce under article 286(2) and in the course thereof, there will be two sales. Taking first the sale from Bengal to Bihar, Bengal -can tax it under article 286(1) (a) because the Explanation thereto is not applicable as the delivery to Bihar is not for local consumption. But article 286(2) would interpose a bar. Bihar cannot tax the sale under article 286(1) (a ), because that is an outside sale,, the Explanation being inapplicable. Coming next to the sale by Bihar to U.P., Bihar will be entitled to tax it under the body of article 286(1)(a) as the sale took place inside its limits. But it cannot do so as under the Explanation, it becomes an outside sale. But U. P. will be entitled to tax the sale under the Explanation as it was for consumption within that State. Thus, the effect of the combined operation of both article 286(2) and article 286(1) ", "(a) read with the Explanation is that the only State which can tax the. sale is the one in which the goods are sold for local consumption. These are the objections advanced by the appellant against the view that the sales covered by the Explanation are outside article 286(2 ), and they are not of sufficient weight to overthrow it. ", "The consideration of this question will, however, be incomplete without an examination of the other two views that have been put forward as to the true meaning and scope of article 286(2). The second view-and that was taken by , J. in .(2) -is that the sales covered by the Explanation are in the course of inter- trade and they are, therefore, within the purview of article 286(2 ), but that as the latter is a general provision covering all sales in the course of inter- trade, and the former deals only with a special class thereof, the maxim generalia specialibus non derogant applies, and the Explanation prevails as against article 286(2). It will be noticed that this agrees with the first view in its conclusion but it differs from it on the reasoning by which it reaches it. According to the first view, sales in the course of inter- trade contemplated by article 28612 ) include only those under which goods are delivered for purposes other than local consumption; whereas according to the second, they include all sales including those in which goods are delivered for consumption within the and those in which they are delivered for other purposes. According to this view, therefore, there is conflict between the Expla- nation and article 286(2 ), and the solution for it is to be sought in the application of the rule of construction that general provisions do not derogate from the special. As between these two views, the first view in for the reasons already given, to be preferred. But if the contention that article 286(2) applies both to sales in which goods are delivered for local consumption and those in which they are delivered for other purposes is correct, then it is difficult to see how the appellant can escape the conclusion reached by , J. in (1) (1953] B.C.R. 1069. ", "791 ", "). The appellant is plainly in the horns of a dilemma. Sales in which goods are delivered for local consumption 'fall either outside article 286(2) or inside it. If they fall outside article 286(2 ), then the appellant can claim no immunity from taxation under that provision. In case they fall inside article 286(2 ), then the Explanation must prevail as against it on the principle generalia specialibus non derogant, and the sales will be liable to be taxed. To get out of this difficulty, the appellant contended that article 286(2) and the Explanation related to two different matters, and therefore the maxim in question had no application. The argument was that article 286 imposed a number of restrictions on the power of the to tax sale of goods from different angles, e.g., when they were outside the , article 286(1)(a); in the course of export or import, article 286(1)(b); in the course of inter- trade, article 286(2); and in relation to commodities declared essential by legislation under article 286(3); that the Explanation was enacted from the standpoint whether the sales were outside or inside and article 286(2) from the standpoint whether they were in the course of inter- trade or intra trade, and that the purpose and the policy of the two provisions being different, their subject-matter must be held to be different and that therefore the maxim was inapplicable. I see no force in this contention. It is a cardinal rule of construction that when there are in a Statute two provisions which are in conflict with each other such that both of them cannot stand, they should, if possible, be so interpreted that effect can be given to both, and that a construction which renders either of them inoperative and useless should not be adopted except in the last resort. This is what is known as the rule of harmonious construction. One application of this rule is that when there is a law generally dealing with a subject and another dealing particularly with one of the topics comprised therein, the general law is to be construed as yielding to the special in (1) S.C.R. 1069. ", "792 ", "respect of the matters comprised therein. Now, the reason of the rule requires that it should apply whenever there is overlapping of the fields occupied by two conflicting enactments, and when that is shown, it would not be logical to exclude its application on the ground that the enactments have been made with a different purpose. It is the identity of the subject matter of the conflicting provisions, not the identity of their purpose or angle of vision that is essential for the application of the maxim. No authority was cited for limiting it in the manner contended for by the appellant. Now, it is the appellant's own contention that the sales covered by the Explanation are within the purview of article 286(1)(a ), and are therefore exempt from taxation thereunder, and that such taxation would be permissible only when the hold of article 286(2) over the Explanation is removed by legislation under that sub-clause. That is to say, the subject-matter of the Explanation is within the coverage of article 286(2 ), and that the two provisions are directly in conflict. It is difficult to see how consistently with this stand the appellant could resist the application of the maxim aforesaid. It is true that , J. who took that view in .(1) has now retreated from that position. But with respect, there is irrefragable logic in his reasoning in that decision, and that commends itself to me. ", "Then, there is the third view that the sales to which the Explanation applies are in the course of interState trade, and therefore fall within the purview of article 286(2 ), and that in consequence, the power of the delivery State to tax those sales is incapable of exercise, as it is within the prohibition contained in that article, and that when the enacts a law in terms of article 286(2) lifting the ban thereunder, then and not until then could the Explanation have any operation. That was the view expressed by , J. in .(1) and by , J. in . ). (1) S.C.R. 1069. ", "(2) [1954] S.C.R. 53. ", "793 ", "Briefly, according to this view article 286(2) controls the Explanation. Can this be sustained on the language of the enactment?' The Explanation is not expressed to be subject to article 286 (2). Nor does the latter contain the words \"notwithstanding anything contained in the Explanation to article 286(1) (a)\". These are simple and familiar expressions used by the legislature when it intends that a particular provision in the Statute should be subject to or override another. Nor is there anything in the language of the Explanation providing that its operation is not to be in praesenti but contingent on legislation under article 286(2). To construe, therefore, article 286(2) as controlling the Explanation, we must import into the Statute words which are not there and thereby cut down the operation of the Explanation which on its terms is of equal authority and potency with article 286(2). ", "There being nothing express in the language of the enactment to lead to the conclusion that the Explanation is controlled by article 286(2 ), it has to be seen whether that conclusion can be drawn on a construction of the relevant provisions of the Statute. The appellant argues that it can be, and relies firstly on the saving clause in article 286(2 ), and secondly, on the proviso thereto as supporting it. The argument based on the saving clause may thus be stated: The contention that article 286(2) controls the Explanation would have resulted in rendering the latter wholly nugatory, if the words \"except in so far as may bylaw otherwise provide\" had not been there. But that result is avoided by the saving clause under which the Explanation can come into operation when there is ary legislation lifting the ban under article 286(2). This construction, it is argued, gives effect to the plain language of the article and also to both the provisions. But when examined, it will be seen that far from giving effect to both the Explanation and article 286(2 ), this construction results in destroying one or the other of them. The harmonious construction which the law favours is one which gives operation to both the provisions at the same time but in their respective spheres. But according to the appellant, if article 286(2) is in force then the Explanation cannot operate, and if the Explanation is to operate, it can only be if the puts an end to article 286(2) by legislation thereunder. This construction, far from reconciling the two provisions and giving operation to both of them, renders them uncompro- misingly hostile, and makes their coexistence and co- operation impossible. ", "It is also open to question whether the saving clause could be referred to for the purposes of determining the respective spheres of operation of the Explanation and the body of article 286(2). The scope of a saving clause or an exception is that it operates within the area covered by the main provision on which it is engrafted. It cannot add to it though, when in force, it can detract from it. It would, therefore \" be inadmissible for enlarging what would otherwise be the sphere in which article 286(2) would operate. If the view that article 286(2) controls the Explanation cannot be maintained on a construction of the body of article 286(2) and the Explanation, it cannot properly be adopted on the strength of the saving clause annexed thereto. ", "There was considerable discussion before us as to the nature and scope of the law that could be enacted under article 286(2). It must be confessed that the matter is not free from doubts and difficulties. But about one thing, there can be no dispute.The law to be enacted by cannot runcounter to any of the provisions of the Constitution.Thus, it cannot itself impose a tax on sales, thatbeing within the exclusive jurisdiction of the states under Entry 54 in List II. Nor can it confer a power to tax a sale in the course of commerce on any State of its own choice in contravention of the Explanation to article 286(1) (a ), Its operation can only be negative. It can lift the ban imposed by article 286(2). It was suggested for the appellant that it can do that as regards particular commodities or with reference to particular States, and that further in so limiting the operation it could enact suitable provisions for an equitable adjustment of the interests of all the States. But laws limited in their operation to specified commodities and States must in their very nature, be temporary legislation to be withdrawn and re-enacted from time to time suitable to the ever changing conditions of trade and commerce. If that was the sort of legislation that the Constitution-makers had in mind, one would have ex- pected that the authority contemplated by article 307 would have been empowered to deal not merely with the matters mentioned in articles 301 to 304 but also article 286(2 ), and it is also not a little surprising that no legislation should have been enacted on those lines during all these years. In any event, it must be a profitless task to speculate on the scope and effect of a hypothetical legislation under article 286(2 ), and it would be unsafe to base any conclusion as to the true scope of the Explanation on the existence of a power in the to enact a law under article 286(2). ", "The contention based on the proviso to article 286(2) must now be considered. It was argued that while the proviso is to have operation notwithstanding anything contained in article 286(2) it does not similarly override article 286 (1) (a) and that therefore when the President issued an order under that proviso, the Explanation would have operation, and that therefore it was not useless. To this contention, there are two answers: (1) An order issued by the President under the proviso can operate only to continue existing taxes. It cannot go further, and authorise the imposition of a tax even when the conditions mentioned in the Explanation are satisfied, if, in fact, it had not been previously collected. Therefore, the Explanation can have no practical effect on the operation of the proviso. If, in fact, a delivery had been levying a tax before the commencement of the Constitution, that would continue to be valid under the proviso, not by the operation of the Explanation but by reason of the fact that it had been levied before. Thus, the Explanation as such has no opera- tion. (2) It should also be mentioned that prior to the Constitution no was actually levying a tax on the basis of delivery and therefore the Explanation could have no practical effect even when the President made the order. The Constitution-makers presumably had before them the sales tax legislation of all the s, and it is a legitimate inference that they could not have thought of the Explanation as deriving any force or operation by reason of an order of the President under the proviso. Mr. , counsel for , one of the interveners, arguing in support of the contention of the appellant that article 286(2) is the controlling provision, suggested a third category of cases wherein the Explanation could operate apart from a law under the saving clause in article 286(2) or the order of the President under the proviso thereto. His argument was this: Suppose that both the seller and the purchaser are in 'A' and the goods are located in 'B'. The instrument of sale is executed in , and pursuant thereto, the purchaser gets actual delivery of the goods in . Article 286(2) has no application to the sale as there is no inter- movement of goods thereunder. But for the Explanation, would have been entitled to tax the sale as it was inside that . But the Explanation bars it, and confers on the right to tax it. This) it is contended, gives operation to the Explanation consistently with the view that it is controlled by article 286(2). The assumption underlying this argument is that the property in the goods passed in when the instrument of sale was executed, though the goods were then located in . But this is not correct. It is one thing to say that title to the goods passes at the time when the instrument of sale was executed and quite a different thing to state that it passes at the place where it is executed. Considering the matter with particular reference to the power of a to impose tax, sale is a practical conception having relation to the right to enjoy and dispose of the goods, and it is a well- settled feature of all sales-tax legislation that the power to tax the sale is annexed to the place where the goods are located at the time of the contract. Under the general law also, the position is that title to the goods passes in the in which the goods are situated at the time of the sale. In Badische c Anilin Und Soda Fabrik v. Hickson(1), there was a contract of sale signed by both the parties in England with reference to goods situated in Switzerland. The action was laid in England for breach of patent, and the point for decision was whether it was maintainable there. It would have been maintainable there if the sale was in England but not if it was in Switzerland. It was held by that the sale was not in England, and that the action did not lie. The position in law was thus stated by Lord , L.C. at page 421: \"As I understood him, Mr. argued that the defendant had 'vended' these goods in England within the terms of the patent. He admitted that merely to make a contract of sale would not be 'vending' or, to use a word in sense equivalent and in use more familiar, selling. But the maintained that if the contract to sell was made in England, and, in pursu- ance of it goods were, by the consent of buyer and seller, appropriated to meet the contract, then the transaction became a sale completed in England, and that it did not signify whether the goods were at the time of such appropriation in England or abroad. ", "I cannot accept that view. A contract to sell unascertained goods is not a complete sale, but a promise to sell. There must be added to it some act which completes the sale, such as delivery or the appropriation of specific goods to the contract by the assent ' express or implied, of both buyer and seller. Such appropriation will convert the executory agreement into a complete sale. ", "* * * * * * In my opinion, if you must decide in what country an appropriation of goods by consent takes place, it takes place not where the consent is given, but where the goods are at the time situate\", (1) [1906] A.C. 419, In view of these observations, it cannot be contended that the title to the goods passed in and that gets the right to tax by reason of the Explanation. gets the power to tax the sale not under the Explanation but under the general law. This contention, it should be noted, has reference to cases which ex hypothesi are outside article 286(2 ), and has only an indirect bearing on the question whether article 286(2) controls the Explanation. It is necessary now to refer to the arguments addressed by both parties based on what were stated to be the broad principles underlying the Constitution and on considerations of hardship or inconvenience arising from one view or the other. It was argued for the appellant that the intention of the Constitution-makers as disclosed in article 301 was to encourage the free flow of trade and commerce within the Union unimpeded and unobstructed by State legislation, that article 286(2) was enacted in furtherance of that policy, as taxation by the States might become so heavy as to become burdensome to inter-State commerce; that the normal situation envisaged by that article was, therefore, that no tax should be levied on sales in the course of inter-State trade, power being reserved in to intervene in appropriate cases and that consistently with this policy, article 286(2) should be construed as the controlling provi- sion and the Explanation as an emergency reserve. The reply of the respondent was that the intention of the Constitution as expressed in article 286(1) (a) was to avoid multiple taxation of sales in the course of inter-State trade, and not to free them from any taxation, that the Constitution did contemplate the levy of one tax on every sale, and that the construction of the appellant, if accepted, must place local sales in a greatly disadvantageous situation as against sales in the course of inter-State trade, and that must result in driving out local trade and business across the borders of the State. ", "The appellant is undoubtedly right in his contention that the Constitution intended trade and commerce within the Union to be free. But the question is whether that requires that there should be no tax at all at any stage even when the goods have come to the end of their journey as a result of sale. That clearly is not the law in America where inter-State commerce is highly developed and jealously protected. That the Constitution did contemplate one tax on a sale-in the course of inter- State trade when it is for local consumption is clear from the Explanation. To argue that freedom from taxation under article 286(2) is the normal condition, and that taxation under the Explanation is an exception is to beg the very question that we have got to decide. No other provisions of the Constitution have been cited as expressive of that intention. On the other hand, such indication as there is, tends in the opposite direction. Article 304(a) which is an exception to article 301 authorises the imposition of a tax on imported goods when similar goods locally manufactured are subject to a State tax provided that such imposition is not discriminatory. It is true, as contended by the learned Attorney General, that under article 304 (a) the taxis levied on the goods whereas under article 286(2) it is laid on the transaction of buying and selling. But on a question of policy, what difference would it make whether the tax is imposed on the transaction of sale or on the import of goods, as in either case it must fall on the consumers? That clearly is the reasoning of the majority of the learned Judges in .(1), and there has been no satisfactory answer to it by the appellant. ", "On the other hand, article 304(a) lends considerable support to the contention of the respondent that it could not have been the intention of the Constitution to place local sales in a worse position than sales in the course of inter-State commerce, which must be the result of holding that sales in the course of interState trade are immune from taxation under article 286(2 ), while intrastate sales are liable to be taxed under Entry 54. What reason or justice can there be for making.a local purchaser of goods pay a higher price therefore than what a purchaser of the same goods (1) S.C.R. 1069, 1088. ", "800 ", "across the line would have to pay? The only answer that was suggested was that the might refrain from taxing even intra- sales of those commodities which are the subject-matter of inter trade. Seeing that inter- trade is happily an expanding factor in national life, and that it tends to comprehend an increasing variety of goods, there will be left, if the suggestion of the appellant is to be followed, very few commodities which the could tax, and Entry 54 might as well be effaced from out of the Constitution. There is, besides, the apprehen- sion expressed by the respondent-and it cannot be brushed aside as fanciful-that if the contention put forward by the appellant is accepted, then it must inevitably result in local trade shifting on to adjacent s. If the scheme of the Constitution is, as I conceive it to be, to put both intrastate sales and sales in the course of inter- trade on the same footing -and that is manifest on the language of article 301 -it must follow that as the former are liable to be taxed under Entry 54, the latter should also be similarly liable to be taxed, and that is precisely what the Explanation provides for. ", "It was next argued for the appellant that the view that under the Explanation delivery States would be entitled to tax all sales in the course of inter-State trade if goods are delivered for consumption there, would render sellers liable to be taxed in all the States in which their goods are sold, and that would subject them to a perplexing multitude of assessment proceedings in several States and that must cause great inconvenience and hardship in business circles. Our attention was also invited to the provisions of the impugned Act relating to assessment and collection of tax, and it was contended that they must result in considerable harassment of the assessees. As against this, the respondent contended that the sellers had really no grievance in the matter as the tax would be ultimately paid by the consumers, and that, on the other hand, if the contention of the appellant were to be accepted, the States would have to lose a substantial portion of the revenue derived from sales tax and that must seriously affect their economy. It must be conceded that in the view that the Explanation authorises the imposition of tax on all sales in the course of inter-State trade falling within its purview, non- resident sellers will be liable to be taxed in every State in which the goods are sold for consumption, and that they must in consequence be exposed to multiple assessment proceedings in different jurisdictions and that that must cause inconvenience. But then, that is necessarily inherent in the Explanation whether it operates when the ban under article 286(2) is lifted by Parliamentary legislation as contended for by the appellant, or even without such law, as the respondent maintains. That does not, therefore, appear to be very material in construing the scope of the Explanation. The right which residents of one State have to trade freely in other States is one conferred by article 301 and is a creature of the Constitution, and when the same Constitution provides for taxation of sales in the course of inter-State trade -by the Explanation to article 286(1) (a ), and the inconvenience complained of results from that provision and is incidental to its enforcement, it does not sound logical that the sellers should, while electing to take the benefit under article 301 , disclaim their obligations under the Explanation. ", "The point of substance against the appellant is that the sellers are not the persons really affected, as the incidence of taxation will ultimately fall on the consumers. The Explanation applies to goods delivered for consumption within the , and the tax imposed on the sale of such goods is really a tax laid on the purchasers for consumption. It might happen that such purchasers are numerous and scattered all over the , and that must be so when the goods sold are,' as in the present case, medicines. The power to tax in such a case can be effectively exercised only through the seller. No administrative machinery can succeed in reaching the consumers when their name is legion, and as the seller is merely to pass on the tax to the consumer, he is, in fact, constituted collector of the tax on behalf of the . This is the practice largely adopted in America in the collection of Use Tax, and its validity has been repeatedly affirmed. A recent decision on the question is that in v. Tax Commission of the of Iowa(1). There, the of Iowa imposed a Use Tax on a foreign Company in respect of goods distributed by it for consumption within the . In upholding the tax, , J. observed: \"To make the distributor the tax collector for the is a familiar and sanctioned device. v. Johnson(1), v. Gallagher(3)\". It was argued by the appellant that in the above case the foreign company was \"a retailer maintaining a place of business\" within the . But as the tax in question was not a sale-tax but a use tax payable by the purchasers it would be wholly irrelevant whether the distributor bad a place of business within the , and that indeed is what is stated in the judgment itself. ", "Even looking at the matter from the practical standpoint, it is easy to exaggerate the inconvenience which the Explanation might cause. If sellers have trade and commerce all over the States, theirs must undoubtedly be a big business. That means that they would have, for the purpose of the business, adequate clerical establishment- accountants, correspondence clerks and so forth. Regular account books would be maintained showing the dispatch of goods to dealers and purchasers in other States. And thus, all the materials on which returns have to be made would be already there. The additional burden will consist in this that in posting the entries in the ledger accounts, separate folios will have to be opened for the several States. This is no doubt additional work thrown on the sellers, but viewed in its true perspective, it is too unsubstantial to deny the States a substantive power to tax. It is said that there would be considerable harassment of the sellers under the provisions of the impugned Act. But why should there (1) 332 U.S. 385; 88 L. Ed. 1309. ", "(2) 292 U.S. 86; 78 L. Ea. 1141, 1147, 1148. ", "(3 306 U.S. 62; 82 L. Ed. 488. ", "803 ", "be? It must be presumed that sales-tax officers will do nothing unfair or oppressive, and the correspondence between the parties preceding the proceedings shows a just and sympathetic attitude on the part of the respondent. True, some of the provisions of the Act are of a stringent character. But they have' terrors only for those who would evade and avoid tax, and persons like the appellant doing big business Of an all-India character and maintaining regular and correct accounts have nothing to fear from them. Now, let us look at the other side of the picture. Prior to the Constitution, the s bad the power to tax even sales in the course of interstate trade and commerce, and it is stated that a substantial portion of their revenue was derived from this source. The Constitution enacted article 286 (1) (a) with a view to avoid multiple taxation of sales in the course of inter- trade, and it is the contention of the respondent that the Explanation on its true interpretation provides for a single taxation of those sales, at the stage of consumption. If the contention of the appellant as to the scope of the Explanation and of article 286(2) is accepted, this tax could not be levied after the 31st March 1951, and the s would have lost a substantial source of revenue. What is the substitute that the Constitution has provided therefor? None. In the result, there must be, as argued by the respondent, a financial crisis in the affairs of the s. The position, therefore, is that we have to choose between depriving the s of their power to impose a tax on which their very existence depends, and exposing the sellers having business outside their to the inconvenience of multiple assessment proceedings. In that situation, can there be any doubt as to what our decision should be? Surely, the claim of the should have precedence over that of individuals. It is very significant that all the s which have intervened have, with one exception, strongly supported the stand of the respondents. That exception is the of West Bengal. The learned Attorney-General appearing for this did not contend for any right in it to tax the sales. His argu- ", "102 ", "804 ", "ment was that neither West Bengal nor Bihar was entitled to tax by reason of article 286(2). The intervention of West Bengal is, therefore, not for protecting its rights but for the vindication of the law, as it conceives it to be. ", "It was suggested for the appellant that the solution to the problem lay in the taking over the subject of tax on sales in the course of trade, provision being made for distribution of the receipts among the States under article 269 after making the necessary amendments to the Constitution. Our duty is to construe the provisions as they stand and not to discuss questions of policy which it is for the to decide; and if I examine the suggestion of the appellant, it is only for the purpose of finding out what light it throws on the present controversy, and how far it will be an improvement on the present position under the Constitution. Under Entry 48 in List II of the Government of India Act, 1935, the States had the power to impose tax on sale of goods and advertisements. When dealing with this topic, the Constitution-makers took over advertisement of newspapers to the Union List, the residue being left to the States. Thus, the decision to entrust the power to tax sales to the States was deliberate, and there is good reason for it. Sales might take place either in the course of trade or be intraState. There can be no question of the taking over taxation of intrastate sales. To confer a power on the to tax sales in the course of trade alone would be to dichotomise the power to impose sales tax and distribute it between the States and the . For such a course, there does not appear to be any precedent, anywhere, and the practical inconvenience attendant thereon is obvious. Moreover, let us assume that the takes over the taxation of sales in the course of trade. What difference will it make in the present position? So far as sellers are concerned, they will have to submit one consolidated statement of all the sales outside their State instead of splitting them according to the States in which the sales are effected, and there will be a single assessment proceeding instead of as many as the States where the sales take place., That would no doubt avoid much of inconvenience. But, so far as the burden of taxation on the sellers is concerned, the position would be exactly what it is now. And on what principle is the to distribute the tax realisations among the States? It can only be on the basis of receipts from the several States. And there is justice in each State claiming what is realised from the consumers resident within its territory. That is precisely the scope of the consumption tax under the Explanation. Thus, the suggestion of the appellant, if acted upon, will not relieve it from the liability to be taxed; it will only reduce the assessment proceedings from many to one. In other words, the relief will be with reference not to substantive rights, but to a matter of procedure. But the contention of the appellant that article 286(2) controls the Explanation is directed not against the procedure in the assessment of tax, but against the very liability to be assessed to it, the argumentum ab inconvenienti being availed of as a ground for denying it. The suggestion, therefore, that the taxation of sales in the course of trade should be left to the lacks substance. 'Even with reference to the inconvenience that might result from the multiplicity of assessment proceedings, it is one which is capable of being removed without disturbing the existing scheme of the Constitution, by enacting a law constituting an authority under article 367 and conferrinly on it power to receive from the sellers one consolidated -statement of all their sales outside their State and determining the precise extent thereof effected in the several States and making that determination final for purposes of assessment by the States. That would, on the one hand, secure to the States the finance legitimately due to them under the Explanation, and at the same time,, save the sellers from the harassment of multiplicity of proceedings. Such a law cannot be impugned as trespassing on the exclusive domain of the States to impose sales tax under Entry 54, as the authority to impose the tax would continue to be the States. It is the law of the several States that will determine the conditions under which, and the rate at which, the tax will be chargeable. It is the machinery set up by the States that will make the assessment and collect the taxes, and these realisations will find their way into the coffers of the States. The effect of the Act would be only to enact a rule of evidence, on which the assessing authorities have to act. Such a law would not conflict with any of the provisions of the Constitution. It is scarcely necessary to add that this suggestion is only by way of answer to the one put forward by the appellant, and even if there are Constitutional difficulties in the way of acting on it, that would not affect the decision of this appeal, which must turn on the provisions of the Constitution as they stand. ", "Having carefully considered the arguments addressed by the learned counsel appearing for the parties to the appeal and for the interveners, I am clearly of opinion that the sales falling within the Explanation are, by reason of the fiction enacted therein, intraState sales, that accordingly they fall outside the ambit of article 286(2) and are unaffected by the prohibition contained therein. In coming to this conclusion, I have considered the question afresh and on its own merits as if it were res integra. But, in fact, it is concluded by the decision of this in . (1) to which reference has been made in the course of the discussion. It is conceded that if this decision is to govern, then this point would have to be found against the appellant. But it is contended that it is erroneous and should not be followed. That raises the question whether this has the power to reconsider a previous judgment given by it on the identical issue. As the point arises for decision for the first time before this , and as our pronouncement thereon must be of the highest importance, we have heard arguments as to what the practice is in the highest judicial tribunals of other countries with reference to this matter. ", "(1) [1953] S.C.R. 1069. ", " ", "In v. (,), it was held by that its decision on a question of law was conclusive and binding on the in subsequent cases and that if it was erroneous, it could be set right only by an Act of . The practice before however has been different. In v. Clifton(1), Lord dealing with this question observed as follows: \"In the case of -decisions of final Courts of appeal on questions of law affecting civil rights, especially rights of property, there are strong reasons for holding the decisions, as a general rule, to be final as to third parties. The law as to rights of property in this country is to a great extent based upon and formed by such decisions. When once arrived at, these decisions become elements in the composition of the law, and the dealings of mankind are based upon a reliance on such decisions. Even as to such decisions it would perhaps be difficult to say that they were, as to third parties, under all circumstances and in all cases absolutely final, but they certainly ought not to be reopened without the very greatest hesitation\". ", "The case before the was one involving questions of ecclesiastical law, and it was held that in such cases their Lordships were free to examine for themselves the reason on which the prior decision rested and to decide on their own view of the matter. The authorities bearing on this question were reviewed by at some length in Re: Transferred Civil Servants (Ireland) Compensation(3), and the result was thus summed up: ", "\"There is no inherent incompetency in ordering a rehearing of a case already decided by the , even when a question of a right of property is involved, but such an indulgence will be granted in very exceptional circumstances only. It is of the nature of an extraordinarium remedium\". This opinion was reiterated in Attorney-General of Ontario v. ) wherein Viscount said: ", "(1) [1898] A.C. 875. ", "(2) [1877] 2 P.D. 276. ", "(3) [1929] A.C. 242. ", "(4) A.I.R. 1946 P.C. 88. ", " ", "\"Their Lordships do not doubt that in tendering humble advice to His Majesty they are not absolutely bound by Previous decisions of the , as is by its own judgments. In ecclesiastical appeals, for instance, on more than one occasion, the has tendered advice contrary to that given in a previous case, which further historical research has shown to have been wrong. But on constitutional questions it must be seldom indeed that the would depart from a previous decision which it may be assumed will have acted upon both by Governments and subjects\". ", "Thus, the practice of has been to recognise a power to reconsider its previous decisions, but it is exercised only in exceptional circumstances. In v. Commonwealth(1) has ruled that it has the power to examine the correctness of its previous decisions. The practice of is that it has considered itself free to reconsider its previous decisions especially when they relate to questions of constitutional law. (Vide Willoughby on Constitutional Law, Vol. 1, pages 74 and 75 and the cases cited there). The reason given for this view is that while errors of law not bearing on constitutional provisions could be corrected by ordinary process of legislation, an error on a question of constitutional law could be set right only by resort to the dilatory and cumbersome machinery of amending the Constitution. ( v. Allright(2)). This reasoning will also be applicable to decisions involving interpretation of our Constitution. It was argued for the respondents that article 141 gives the decisions of this the status of law, and that, therefore, if they are to be changed that could be only by process of legislation. Article 141 only enacts that the decisions of this are binding on all courts, and that does not stand in the way of this itself, reversing or modifying a previous decision, as when that is done, such decision would thereafter become itself the law under that article. There is, therefore, good (1) 18 C.L.R. 54. (2) 321 U.S. 659: 88 L.Ed. 987. ", "809 ", "reason for holding that this has the power to reconsider, inappropriate cases, a previous decision given by it. ", "The question then arises as to the principles on which and the limits within which this power should be exercised. It is of course not possible to enumerate them exhaustively, nor is it even desirable that they should be crystallised into rigid and inflexible rules. But one principle stands out prominently above the rest, and that is that in general, there should be finality in the decisions of the highest courts in the land, and that is for the benefit and protection of the public. In this connection, it is necessary to bear in mind that next to legislative enactments, it is decisions of that form the most important source of law. It is on the faith of decisions that rights are acquired and obligations incurred, and States and subjects alike shape their course of action. It must greatly impair the value of the decisions of this , if the notion came to be entertained that there was nothing certain or final about them, which must be the con- sequence if the points decided therein came to be re- considered on the merits every time they were raised. It should be noted that though has repeatedly declared that it has the power to reconsider its decisions, in fact, no instance has been quoted in which it did actually reverse its previous decision except in ecclesiastical cases. If that is the correct position, then the power to reconsider is one which should be exercised very sparingly and only in exceptional circumstances, such as when a material provision of law had been overlooked, or where a fundamental assumption on which the decision is based turns out to be mistaken. In the present case, it is not suggested that in deciding the question of law as they did in .(1) the learned Judges ignored any material provisions of law, or were under any misapprehension as to a matter fundamental to the decision. The arguments for the appellant before us, were in fact only a (1) S.C.R. 1069. ", "810 ", "repetition of the very contentions which were urged before the learned Judges and negatived by them. The question then resolves itself to this. Can we differ from a previous decision of this , because a view contrary to the one taken therein appears to be preferable? I would unhesitatingly answer it in the negative, not because the view previously taken must necessarily be infallible but because it is important in public interest that the law declared should be certain and final rather than that it should be declared in one sense or the other. That, I conceive, is the reason behind article 141. There are questions of law on which it is not possible to avoid difference of opinion, and the present case is itself a signal example of it. The object of article 141 is that the decisions of this on these questions should settle the controversy, and that they should be followed as law by all the s, and if they are allowed to be reopened because a different view appears to be the better one, then the very purpose with which article 141 has been enacted will be defeated, and the prospect will have been opened of litigants subjecting our decisions to a continuous process of attack before successive in the hope that with changes in the personnel of the which time must inevitably bring, a different view might find acceptance. I can imagine nothing more damaging to the prestige of this or to the value of its pronouncements. In v. Commonwealth(1), it was observed that a question settled by a previous decision should not be allowed to be reopened \"upon a mere suggestion that some or all of the Members of the later might arrive at a different conclusion if the matter was res integra. Otherwise, there would be grave danger of want of continuity in the interpretation of the law\" (per , at page 58). It is for this reason that article 141 invests decisions of this with special authority, but the weight of that authority can only be what we ourselves give to it. ", "It was suggested as a ground for reconsidering the correctness of the decision in The State of Bombay v. (1) 18 C.L.R. 64. ", " ", ") that it had caused great hardship to the business world. I have already held that there is not much of substance in this complaint. On the other hand, acting on the view that the Explanation confers on the delivery States power to tax the sales, several States amended their Sales Tax Act s in 1951 by inserting appropriate provisions and it is represented before us that for some years, taxes have been collected by the States on the basis of these provisions. If we are now to hold that the view taken in .(1) is erroneous, the consequences will be to render the amended provisions inoperative and the collections of taxes made thereunder illegal. The States will then be not merely powerless to tax sales falling within the Explanation in future, but will have actually to refund whatever they might have collected in the past. I can see no end to the chaos, confusion and trouble that must ensue on such a decisions situation that can be retrieved only by removing article 286(2) out of the scene with retrospective operation, and all this, to benefit not the consumers who are the persons really affected but the sellers who are only statutory middlemen for collection, some of whom are stated to have collected sales tax from purchasers outside their States. I consider it wholly inexpedient that our power of reconsideration should be exercised for that end. This, of course, is apart from my conclusion that on a correct interpretation of the Explanation and article 286(2 ), the respondents have the power to tax. In the result, this point must be held against the appellant. ", "4. I shall now consider the question urged by the appellant that the Bihar Sales Tax Act is invalid on the ground that it is extra-territorial in operation and ultra vires the powers of . The Constitutional provisions bearing on this question are articles 245(1) and 246(3) which are as follows: \"245. (1) Subject to the provisions of this Constitution, may make laws for the whole or any part of the territory of India, and the Legis- ", "(1) (1953] S.C.R. 1069. 103 lature of a State may make laws for the whole or any part of the State. ", "246.(3) Subject to clauses (1) and (2), the of any State specified in Part A or Part of the First Schedule has exclusive power to make laws for such State or any part thereof with respect to any of the matters enumerated in List II in the Seventh Schedule (in this Constitution referred to as the \"State List\")\". ", "The contention of the appellant is that the words \"for the whole or any part of the \" in article 245(1) and \"for such or any part thereof with respect to any of the matters enumerated in List II\" in article 246(3 ), impose a territorial limitation on the jurisdiction of the Legislature; that under these provisions it can enact laws only for persons and properties within the and that the provisions of the Act to the extent that they impose tax on sellers who are outside the are ultra vires. It was also contended that the impugned provisions were extra- territorial in their operation, and were beyond the compe- tence of the Legislature. The questions thus raised are of great importance involving the determination of the nature and extent of the power which a has to make laws in respect of the matters enumerated in List II. It is necessary, to begin with, to define the precise meaning of the words \"extra-territorial operation\". A sovereign has plenary jurisdiction to enact laws for its own territory. Such laws may be in respect of persons within the territory whether citizens or not, of property, immovable or movable, situated within the ; or of acts and events which occur within its borders. In Maxwell on Interpretation of Statutes (10th Edn. p. 144) the law is thus stated: ", "\"Primarily, the legislation of a country is territorial. The general rule is, that extra territorium jus dicenti impune non paretur. The laws of a nation apply to all its subjects and to all things and acts within its territories\". In \"Conflict of Laws-Restatement of the Law\" by , the position is thus summed up: \"47. A State has jurisdiction over a person: ", "(a) if he is within the territory of the State,, ", "(b) if he is domiciled in the although not present there, ", "(c) if he has consented or subjected himself to the exercise of jurisdiction over him either before or after the exercise of jurisdiction. ", "48. An immovable thing is subject to the jurisdiction of the State within which it is. ", "49. A chattel is subject to the jurisdiction of the State within which it is. ", "56. A has jurisdiction over all acts done or events occurring within the territory of the , and over all failures to act in cases where there is a legal duty to act within the \". ", "The legislation in respect of the above matters is intra- territorial, notwithstanding that it might operate on persons residing outside the . Thus, a law of a taking over the management of lands of absentee-landlords must operate on owners who are residing abroad. But in strictness, this is not extraterritorial legislation but legislation in respect of lands within the . Likewise, a law with reference to acts or events which occur within the is not extra-territorial, though it might have to be enforced against a person who is residing outside the . Such a law is one in respect of an act or event within the . These laws, though intra-territorial, are often loosely described as extra-territorial in operation. In this context the words \"extra-territorial operation\" connote laws in respect of properties or acts or events within a but having impact or operation on persons outside the . ", "There is another sense in which these words are used. When a enacts a law with reference to an act or event which takes place outside its territory, it is described as extra- territorial, and such legislation is recognised as valid by rules of International Law where it is directed against its own nationals and persons in its service. Thus, in \"Con- ", " ", "flict of Laws-Restatement of Law\" it is observed that \"a nation has jurisdiction over its nationals although not present within the territorial limits of the nation\". (Page ", "78). In Corpus Juris Secundum, extraterritoriality is defined as \"the act by which a State extends its jurisdiction beyond its own boundaries into the territory of another State\", and it is added that \"the almost self- evident proposition should perhaps also be noted in this connection that a sovereignty has power to make laws regulating the conduct of its subjects, while beyond the limits of its territorial jurisdiction\". (Volume 15, pages 868-869). 'Extra-territorial Legislation\", says , \"simply means legislation which attaches significance for courts within the jurisdiction to facts and events occurring outside the jurisdiction\". (Statute of Westminster and Domination Status by , 4th Edition, page 167). A typical illustration of this class of legislation is furnished by section 4 , Indian Penal Code , which enacts that \"the provisions of this Code apply also to any offence committed by- ", "(1)any citizen of India in any place without and beyond India; ", "(2)any person on any ship or aircraft registered in India wherever it may be. ", "Explanation:In this section the word 'offence' includes every act committed outside (India) which, if committed in (India) would be punishable under this Code. Illustration:A (who is a citizen of India) commits a murder in Uganda. He can be tried and convicted of murder in any place in (India) in which he may be found\". ", "In this connection, extra-territorial legislation means a law of a State with reference to its own citizens in respect of acts or events which take place outside the State.. In discussing questions relating to extra-territorial operation, it is desirable that the two connotations of the words should be kept distinct and separate. As the impugned Act purports to tax sales within its territory, its operation against persons who are residing outside but in respect of sales within the State is extra-territorial in the first sense, 'and it is the validity of the provisions of the Act in this sense that this appeal is concerned with. ", "Now, the question is, can make laws with extra-territorial operation in the sense stated above? The appellant contends that it cannot, and calls in aid observations and decisions of with reference to the powers of a subordinate or colonial legislature to enact laws with extra-territorial operation. In v. AttorneyGeneral for New South Wales(1), the point for decision was whether an Act of New South Wales conferred, on its true construction, jurisdiction on the Courts within the Colony to try an offence of bigamy com- mitted presumably by its national in America. In construing it as intended to apply to crimes committed within the State, Lord , L.C. observed that the jurisdiction of the colonies to enact laws was \"confined within their own territories\", and that \"it would have been beyond the jurisdiction of the Colony\" to enact a law in respect of a crime committed outside their territory. These observations refer to extra-territorial operation in the second sense stated above, and have no application when the law of the State is in respect of an act or event taking place within its territories. In v. Attorney- General of Newfoundland(3), the question was with reference to a law of Newfoundland imposing a tax on telephone companies in respect of cables landed or established in the Colony. In discussing the scope of these provisions, Lord observed at page 826: ", "\"While, of course, it was competent to impose taxation on cables within its territorial jurisdiction, it was not competent for the Government to lay a tax on cables outside its territorial jurisdiction\". ", "These observations again have no bearing on the point now under consideration whether a law enacted in respect of an act or event occurring within the State is incompetent, if it seeks to operate on a person concerned in the act but residing outside the State. In (1) (1891] A.C. 455. ", "(2) [1912] A.C. 820. ", " ", " v. The King(1), the question was as to the validity of section 1025 of the Criminal Code of the Dominion of Canada which enacted that \"no appeal shall lie in criminal case to any authority in the United Kingdom by way of appeal or petition to His Majesty in Council\". It was held by Viscount , L.C., that that section was repugnant to the Privy Council Acts of 1833 and 1844, and was therefore void under the Colonial Laws Validity Act, 1865, and that accordingly the appeal to was competent. He also observed that however widely the powers of be construed, they were confined to action to be taken in the Dominion, and could not extend to annulling the prerogative right of the King in Council to grant special leave to appeal. As the law in question was in respect of crimes committed within the State, these observations are capable of the construction which the appellant seems to put on them that such a law would be incompetent to the extent that it is to have operation outside the State. But it must be mentioned that the vires of the action to be taken under the Act within the State itself was affirmed in unqualified terms, and that is what we are concerned with in this appeal. The question, however, must now be taken to be settled by the decision in v. ). There, the question related to the validity of sections 151 and 207 of the Customs Act of Canada under which the officers of the State were authorised to search ships within 12 miles of the coast, and seize dutiable goods found in them, the provisions being obviously intended to aid in the effective collection of customs. There was no dispute that the legislation was within the competence of , customs being one of the topics enumerated in section 91 of the British North America Act, 1867, but the attack was on the validity of sections 151 and 207 on the ground that their operation was extra-territorial. Thus, the question raised is the very question which now arises for determination. In holding that the legislation was valid, Lord observed as follows: ", "(1) (1926) A.C 482. (2) [1933] A.C. 156. ", "817 ", "\"Once it is found that a particular topic of legislation is among those upon which may competently legislato as being for the peace, order and good Government of Canada or as being one of the specific subjects enumerated in section 91 , British North America Act, their Lordships see no reason to restrict the permitted scope of such legislation by any other consideration than is applicable to the legislation of a fully Sovereign State\". The law as settled by this decision may thus be stated: Whether a subordinate has power to enact laws with extra-territorial operation will depend on the terms of the Constitution Act which creates it and subject to any limitations contained therein, it has in respect of the topics assigned to it powers of legislation as plenary as the Sovereign which constitutes it. It was argued by Mr. that subsequent to the decision in v. Dunphy(1) had again to consider in v. The King(1) the validity of a Canadian law which had extra-territorial operation, and therein the grounds of the decision in v. The King(1) were stated at page 516 with apparent approval, and that though the legislation was held to be valid, it was because of the Statute of Westminster, 1931, and that in the absence of a similar statute for India, the of this country had only the limited powers recognised in v. The King(1), and that extra- territorial legislation was incompetent. But there is nothing in the observations in v. The King(1) relied on by the appellant, to support the contention that the view expressed in 's case('.) was adopted in preference to that taken in v. Dunphy(1); in fact, there was no decision at all on this point. Nor does the fact that the Statute of Westminster has conferred an express power on the Colonial to enact laws with extra-territorial operation affect the weight to be attached to the conclusions come to in v. Dun- (1) A.C. 156. (2) A.C. 500, 516. (3) A.C. 482. ", " ", "phy(1), because they were reached, not with reference to the Statute of Westminster about the applicability of which retrospectively to the case before the there was controversy, but on general principles, and what is more to the present case, it was the law as declared in v. Dunphy(1) that was before the framers of the Constitution when they enacted sections 99 and 100 of the Government of India Act, 1935. ", "Turning now to the Constitutional provisions under the Indian law, this topic is dealt with in sections 99(1) and 100(3) of the Government of India Act. To understand the precise scope of these provisions, it is necessary to examine the position under the previous Constitution Act s. Section 43 of the Charter Act, 1833 (3 and 4 Will. IV, Chap. 85) conferred power on the Governor-General in \"to make laws and regulations for all persons................ and for all and for all places and things whatsoever within and throughout the whole and every part of the said territory\". In the Government of India Act, 1915 (5 and 6 Geo. V) Ch. 61) the corresponding provision was section 65(1)(a) which enacted that the Indian s have the \"power to make laws for all persons, for all and for all places and things within the British India\". Under these provisions, it cannot be doubted that the Indian s would have had no jurisdiction to enact laws operating on persons who were not within the State as that would be plainly opposed to the limitation that they should be \"for persons within the territory\". Both section 43 of the Charter Act, 1833 and section 65(1) (a) of the Government of India Act, 1915 are based on the theory which was then widely held that a subordinate had no competence to enact laws with extra-territorial operation. Then came the Government of India Act, 1935. Sections 99(1) and 100(3) which are relevant provisions are as follows: ", "\"99. (1) Subject to the provisions of this Act, may make laws for the whole or any. part of British India or for any Federated (1) [1933] A. C. 156. ", " ", "State, and may make laws for the Province or for any part thereof. ", "100. (3) Subject to the two preceding sub-sections, has, and has not, power to make laws for a Province or any part thereof with respect to any of the matters enumerated in List II in the said Schedule (hereinafter called the \"Provincial Legislative List\")\". ", "The language of these sections marks, it will be noticed, a wide departure from that of section 43 of the Charter Act and section 65 (1) (a) of the Government of India Act, 1915. The limitation that the legislation should be for persons or things within the territory has been removed. Instead, it is enacted that it could be \"for the whole or part of British India in the case of \" and \"for the Province or part thereof in the case of \", and under section 100(3) , the power is to make laws for a Province or a part thereof with respect to the matters enumerated in List II. Under sections 99(1) and 100 , the legislative power of the or the Province is determined by two conditions. It must be for the territory specified, and it must be in respect of the topics enumerated in the respective lists. If these conditions are satisfied, then the law is valid notwithstanding that it may have impact or operation outside the State. The scope of the legislative power conferred by sections 99(1) and 100 is precisely the same as that conferred on the Legislatures of Canada under sections 91 and 92 of the British North America Act. That was also a power conferred on or the to make laws for the Dominion or the Province in respect of the matters mentioned in sections 91 and 92 respectively. It is on the construction of these provisions that Lord held in v. Dunphy(1) that was competent to enact laws in respect of those matters even if they had extra-territorial operation. The framers of the Government of India Act, 1935, changed the language of section 65(1)(a) of the Gov- ", "(1) [1933] A.C. 156. 104 ernment of India Act , 1915, and substituted words similar to those in sections 91 and 92 of the British North America Act, 1867. It is a reasonable deduction to make that they intended to give effect to the law as declared in v. Dunphy('-). A law which satisfies the two conditions prescribed in sections 99 (1) and 100, therefore, must be held to be intra vires, even though it might have extra- territorial operation. ", "The precise extent of the powers conferred by sections 99(1) and 100 has also been the subject of considerable judicial consideration. In Governor-General in v. ), the question was as to the liability of a Company which was incorporated under the English Companies Act having its main office in England and no place of business in India to be assessed to income-tax under the provisions of the Indian Income-tax Act . The Company held the bulk of shares in nine Companies which were also registered in England and controlled from there, and carried on business in British India and earned profits. Dividends in respect of these profits were declared in London and paid to the assessee in London. The Explanation to section 4(i) ", "(c) of the Indian Income-tax Act enacts that a dividend paid outside British India shall be deemed to be income accruing in or arising in British India to the extent to which it has been paid out of profits subjected to tax in British India. The income-tax authorities claimed that the dividends received by the assessee-Company were liable to be taxed under this provision. The Company resisted the claim inter alia on the ground that as it was not resident in British India and did not carry on business there, had no competence to impose a tax on it, and that the provisions of the Act were ultra vires as extra- territorial in their operation. This contention succeeded before , the Chief Justice observing that the impugned provision amounted to the \"Legislature of British India without specific or apparent authority stretching out its legislative arm and physical band beyond British (1) A.C. 156. ", "(2) [19441 F.C.R. 229. ", "821 ", "India into other countries in an attempt to tax persons and property there not subject to its laws\"; and , J. characterising it as a \"piece of extra-territorial legislation not by a superior or but by a subordinate \". On appeal, this decision was reversed by . , C. J. who delivered the judgment of the held firstly that as the source of the income which was subjected to tax was Indian, it was competent for the Indian to impose a tax thereon, and no question of extra-territorial operation arose. That is to say, Entry 54 in List I gave power to the Indian to tax income which arises from British India, even though the person to be taxed was not resident within British India. He also held that even if an element of extra-territoriality was involved, the legislation was not bad on that account, because section 99(1) and section 100 of the Government of India Act, 1935 were intended to embody the law as declared in v. ) and to confer on the Indian plenary powers of legislation in respect of matters mentioned in the lists, departing in this respect from the position under section 65(1)(a) of the Government of India Act, 1915. - tax, Bombay(1), the appellant was a Company registered in England and controlled from there. It held a 14/32 share in a firm called , which was carrying on business in Bombay. The appellant was sought to be taxed not merely on its income as partner of the Bombay firm about which there was no dispute but also on the income of over seven lakhs of rupees which had arisen and bad accrued to it abroad. The appellant resisted the claim on the ground that the provisions of the Indian Act were ultra vires as their operation was extra-territorial, inasmuch as they sought to tax income of a non-resident received abroad. The Federal rejected this contention. It held that if the person proposed to be taxed had sufficient business connec- (1) A. C. 156. ", "(2) [1945] F.C.R. 65. ", "822 ", "tion with British India, that would confer a jurisdiction on to tax him, and that what heads of income in his hands should be taxed was a matter of policy which was within the province of the to decide. It also held that the provisions of the Act were \"not in their operation extraterritorial in the strict legal sense\". There was an appeal against this judgment to , i.e., v. I. T. Commissioner, Bombay(1). Affirming the judgment of , Lord observed that the fact that the appellant \"was a member of the partnership carrying on business in British India\" was irrelevant in considering whether the legislation was intra vires; that it was to be assumed that there was \"no connection between the and British India except the derivation from British India of the larger part of their income\", and that the validity of the legislation should be determined on that basis. He then observed: \"There is no rule of law that the territorial limits of subordinate legislature define the possible scope of its legislative enactments or mark the field open to its vision. The ambit of the powers possessed by a subordinate legislature depends upon the proper construction of the statute conferring those powers. No doubt the enabling statute has to be read against the background that only a defined territory has been committed to the charge of the legislature. Concern by a subordinate with affairs or persons outside its own territory may therefore suggest a query whether the is in truth minding its own business. It does not compel the conclusion that it is not. The enabling statute has to be fairly construed\". He then referred to section 99(1) and section 100 of the Government of India Act under which had power to enact laws for the whole or part of British India with respect to tax on incomes, and concluded: \"The resulting general conception as to the scope (1) F.C.R. 1. ", "823 ", "of income-tax is that given a sufficient territorial con- nection between the person sought to be charged and the country seeking to tax him income-tax may properly extend to that person in respect of his foreign income............ The principle-sufficient territorial connection-not the rule giving effect to that principle -residence-is implicit in the power conferred by the Government of India Act, 1935. The result is that the validity of the legislation in question depends on the sufficiency for the purpose for which it is used of the territorial connection set forth in the impugned portion of the statutory test\". It is the contention of the respondent that the present question is concluded by this decision. In v. I. T. Commissioner, Bombay(1), the question related to the liability of to be assessed to income-tax in respect of interest received at . There was a Company called carrying on business in Bombay. The shares of the Company were all held by the or by its nominees. It was financed by the , the transaction taking the form of loan advanced at . On these facts., the Income-tax Officer assessed the Agent of the to tax on the interest received at . The validity of this assessment was disputed on the ground that the statutory provisions under which it was made were extra-territorial in their operation and therefore ultra vires. It was held by all the learned Judges following the decisions in Governor-General in v. ) and v. I. T. Commissioner, Bombay(1) that the assessee would be liable to tax if there was sufficient business connection between him and British India, and that, in that event, the provisions would not be bad on the ground of extra- territorial operation. There was, however, a difference of opinion among the learned Judges as to whether, on the facts, sufficient territorial connection had been established, the majority holding that it had been, while two learned Judges (1) [1949] F.C.R. 18. ", "(2) [1944] F.C.R. 229. ", "(3) [1948] F.C.R. 1. ", "824 ", "thought otherwise. That, however, is not material to the present discussion. ", "These authorities establish that under section 99(1) and section 100 of the Government of India Act, a law enacted by in respect of the matters enumerated in the appropriate list$ would -be valid provided it is for the territory entrusted to their charge; that whether it was so or not would depend on whether there was sufficient territorial connection between the person who is sought to be charged or proceeded against under the law and the country which enacts the law; and that when such connection exists, the law is not strictly speaking extra-territorial, and it is not ultra vires on the ground that the person is not residing within the which enacts the law. Then, we come to the Constitution. Articles 245(1) and 246 which deal with this subject reproduce sections 99(1) and 100 with only alterations of a formal character.' They confer on the and power to enact laws in respect of the topics mentioned in the respective lists to be exercised for the territory over which they have jurisdiction. It is a well-settled rule of construction that when a statute is repealed and re-enacted and words in the repealed statute are reproduced in the new statute, they should be interpreted in the sense which had been judicially put on them under the repealed Act, because the is presumed to be acquainted with the construction which the have put upon the words, and when they repeat the same words, they must be taken to have accepted the interpretation put on them by the as correctly reflecting the legislative mind. On a construction of articles 245(1) and 246, therefore, it will be difficult to come to any other conclusion than that a sales tax legislation of a which is otherwise valid is not ultra vires on the ground that the person proposed to be taxed is not resident within the territorial limits of the . ", "Three other contentions urged in opposition to this conclusion must now be considered; ", "825 ", "1.It is only the Central or Federal that has the power to enact laws with extra-territorial operation, and that the s of the States forming units of do not possess such power. ", "2. Under article 245 (2) there is a prohibition against States enacting laws with extra-territorial operation. ", "3. Some of the provisions of the Act forming the machinery sections for the assessment and collection of taxes are, in any event, unauthorised and the whole Act is void on the ground that the valid provisions thereof cannot be separated from the invalid ones. ", "On the first question, it is argued by the learned Attorney- General that the decision in v. Dunphy(1) had reference to a law enacted by and not any of the Provinces, and that the decisions in Governor-General in Council v. (1), - tax, Bombay(1) and (1) related to the Indian Income-tax Act which was enacted by the Central Legislature, and that to apply the doctrine laid down in those cases to laws passed by the s would be to extend its operation beyond recognised limits, and that there was no warrant for it in the Constitution. On principle, it is difficult to see why a law enacted by the in respect of the matters assigned exclusively to its jurisdiction should stand on a different footing from a law passed by on a matter within its jurisdiction. Both the Legislatures derive their authority from the same source, whether it be the Government of India Act, 1935, or the Constitution of India. Under these Statutes, the is not subordinate to the , its authority being supreme in respect of the matters entrusted to it. Under the Government of India Act, 1935, when decided to change what was a unitary into a Federal Government, the process adopted for (1) A.C. 156. ", "(2) [1944] F.C.R. 229. ", "(3) [1948] F.C.R. 1. ", "(4) [1949] F.C.R. 18. ", "826 ", "that purpose was that the resumed all the powers that had been granted under the previous Constitution Act and redistributed them between the and the Province. The terms on which the redistribution was made were identical both for the and the Province, their authority under sections 99(1) and 100 being to enact laws in respect, of the matters mentioned in the appropriate lists an for their respective territory. The extent of this authority must, therefore, be the same both in the case of the and the , each being sovereign within its own sphere. The principle laid down in v. ) that a subordinate has plenary powers in respect of the topics assigned to it will apply as much to the with reference to the matters enumerated in List 11 as to the with reference to the topics mentioned in Lists I and 111. In v. The Queen(1) which is one of the cases on which the decision in v. ) was based, the law under challenge was that of the Province of Ontario in Canada in respect of a topic enumerated in section 92 of the British North America Act of 1867. The question whether s as distinct from the Commonwealth have competence to enact laws with extra-territorial operation has also been considered in some of the decisions of the Australian . In v. in discussing this question observed as follows at page 378: ", "\"Some of the cases also illustrate the fact, occasionally overlooked, that, constitutionally speaking, the status of the States of Australia is equal to, or co-ordinate with, that of the itself. Sovereignty is not attributable to one authority more than to the others; it is divided between them in accordance with the demarcation of functions set out in the Constitution. Within the limits so prescribed, the legislative authority of the States is of precisely equivalent quality and potency to that of the , the authority of which (1) [1933] A.C. 156. ", "(2) [1883] 9 A.C. 117. ", "(3) 56 C.L.R. 337. ", "827 ", "is, in sections 51 and 52 of the Commonwealth Constitution, limited by reference to subject-matter. In short, may legislate for 'the peace, order and good government of the Commonwealth with respect to' a large number of subject-matters. Similarly, the State of New South Wales may legislate for 'the peace, welfare and good government' of New South Wales. In relation to such a subject-matter as that of taxation, and subject, of course, to any overriding provision of the Commonwealth Constitution, it is quite impossible to deny to the States in relation to their geographical area constitutional powers precisely analogous to those possessed by in relation to its geographical area. The legislation of the States cannot be deemed ultra vires merely because of territorial reasons, unless analogous legislation of would similarly be deemed unconstitutional and void\". ", "These observations are very apposite to the present controversy. The conclusion is inescapable that the powers of the and the under sections 99(1) and 100 of the Government of India Act, as also under articles 245(1) and 246 in respect of the matters mentioned in their respective lists have the same content and quality, and that if legislation with extra-territorial operation is within the competence of the , it is equally within the competence of the . ", "Coming now to the second contention, the argument of the appellant is that in enacting that \"no law of shall be deemed to be invalid on the ground that it would have extra-territorial operation\", article 245(2) prohibits by implication the enactment of such laws by the States. This contention is unsound. The words \"extra-territorial operation\" are used, as already stated, in two different senses as connoting firstly, laws in respect of acts or events which take place inside the State but have operation outside, and secondly, laws with reference to the nationals of a State in respect of their acts outside; that in its former sense, the laws are strictly speaking intra-territorial though loosely termed 'extra- territorial', and that under article 245(1) it is within the competence of the and of the State s to enact laws with extra-territorial operation in that sense. The words \"laws with extraterritorial operation\" in article 245 (2) must be understood in their second and strict sense as having reference to the laws of a State for their nationals in respect of acts done outside the State. Otherwise, the provision would be redundant as regards legislation by and inconsistent as regards laws enacted by States. This conclusion is placed beyond doubt when regard is had to the history of legislation on this topic. Section 43 of the Charter Act, 1833 while restricting the scope of legislative authority to persons and things within the State thus denying the power to enact laws with extra-territorial operations in the first sense, conferred a power to make laws \"for all servants of the within the Dominion of Princes and States in alliance with the said \". This was a power to enact extra-territorial legislation in the second sense for servants of the . Section 65(1) of the Government of India Act, 1915 followed the same pattern, and while limiting under sub-clause (a) the power of Indian s to enact laws for persons and things within British India conferred jurisdiction to enact laws with extra-territorial operation in the second sense by sub- clauses (b), (c), (d) and (e) which are as follows: \"65. (1) The (Indian ) has power to make laws- ", "(b)for all subjects of His Majesty and servants of the Crown within other parts of India; and ", "(c)for all native Indian subjects of His Majesty, without and beyond as well as within British India; and ", "(d)for the government of officers, soldiers, (airmen)and followers in His Majesty's Indian forces, wherever they are serving, in so far as they are not subject to the Army Act (or the Air Force Act ); and ", "(e) for all persons employed or serving in or belonging to \". This topic was again dealt with in section 99(2) of the Government of India Act, 1935, which runs as follows: ", "\"99. (2) Without prejudice to the generality of the powers conferred, by the preceding sub-section, no Federal law shall, on the ground that it would have extra-territorial operation, be deemed to be invalid in so far as it applies- ", "(a) to British subjects and servants of the Crown in any part of India; or ", "(b) to British subjects who are domiciled in any part of India wherever they may be; or ", "(c) to, or to persons on, ships or aircraft registered in British India or any Federated States where-ever they may be; or ", "(d) in the case of a law with respect to a matter accepted in the Instrument of Accession of a Federated State as a matter with respect to which may make laws for that State, to subjects of that State wherever they may be; or ", "(e) in the case of law for the regulation or discipline of any naval, military, or air force raised in British India, to members of, and persons attached to, employed with or following, that force, wherever they may be\". In Governor-General in v. ), the question was raised whether these provisions were restrictive of the power of to enact laws with extra-territorial operation in respect of matters other than those enumerated in - section 99(2) . , C.J. held that as the impugned provisions were within the ambit of legislative power under sections 99(1) and 100 of the Government of India Act, 1935, they were not extra- territorial in operation and that even if they were, the words \"without prejudice to the generality of the powers conferred by the preceding sub-section\" occurring in section 99(2) posited the existence of a power aliunde, and that the enumeration of the specified topics in that sub-clause was by way of abundant caution. On the (1) F.C.R. 229. ", "830 ", "14th August, 1947, acting under section 9 of the Indian Independence Act the Governor-General issued an Adaptation Order, and therein, for the words \"for the whole or any part of British India or for any Federated State\" were substituted the words \"including laws having extra- territorial operation for the whole or any part of the \"; and sub-section (2) was omitted. When the Constitution was enacted, the words \"including laws having extra-territorial operation for the whole or any part of the \" were omitted and in their place, article 245(2) was enacted. Thus, article 245(2) is a successor to section 65(1) , sub-clauses (b), (c), (d) and (e) of the Government of India Act, 1915 and section 99(2) of the Government of India Act, 1935, and its scope is extraterritorial legislation in the second sense. As we are concerned in this appeal with extra-territorial operation in its first sense- article 245 (2) has no application, and the attack on the impugned Act on the ground that it is barred by article 245(2) must fail. ", "The third contention has reference to the machinery sections of the Act relating to the assessment and collection of taxes. The argument was that even if had the competence to enact under Entry 54 a taxation law against non-residents, it had no power to enforce it outside its own territorial limits, and some of the provisions were bad on this ground, such as section 17 which authorised search of premises and seizure of accounts, and section 26 which made it an offence to obstruct such search or seizure. But we are not called upon in these proceedings to pronounce on the validity of these provisions. The respondent issued notice under section 13(5) of the Act calling upon the appellant to send his returns and proposing in case of default to make assessment on the basis of best judgment. It was at this stage that the appellant rushed to the , and moved for a writ of prohibition to restrain the pro- ceedings on the ground of want of jurisdiction. That is the one and the only question that now falls to be determined. Even if some of the machinery sections ,Ire bad-it is a question to be decided when it arises whether they can be justified on the ground that they are ancillary or incidental to the substantive provisions, as to which see Attorney-General for Canada v. Cain(1) and v. Dunphy(2)-that would not affect the power of the State to impose a tax, and it will therefore be foreign to the scope of this appeal to enter into a discussion of their validity. It was urged by the learned Attorney-General that if the machinery sections were bad on the ground that they were extra-territorial in their operation, and if the power to tax was so mixed up with them as to be inseparable from them, then, when they fall it must also fall. A power to tax is a matter of substantive law, whereas the machinery sections providing for the execution of that power such as, assessment, and collection of tax, pertain to the domain of adjectival law, and the two are distinct and separable. It is elementary law that the power to tax does not depend on the ability to realise it. In v observed: \"A legislature which passes a law having extraterritorial operation may find that what it has enacted cannot be directly enforced, but the Act is not invalid on that account, and the courts of its country must enforce the law with the machinery available to them\". ", "Without expressing any opinion, therefore, on the validity of the machinery sections, I must hold that the impugned Act in so far as it authorises the imposition of tax on sales falling within the Explanation to article 286(1) (a) is neither ultra vires the powers of nor bad on the ground that it is extra-territorial in its operation. ", "5. Then there remains the contention of the appellant that even assuming that the States could, under the Explanation, enact a law imposing a tax on a non-resident and that such law would not be hit by article 286(2 ), the impugned Act must even then be held to be bad for the reason that it was not auth- ", "(1) [1906] A.C. 542. ", "(2) [1933] A.G. 156. ", "(3) [1946] A.C. 527. ", "832 ", "orised by the terms of the Explanation. Two grounds were urged in support of this contention: (1) that under the Explanation truly construed, a seller could be taxed only if he is within the State, and (2) that the goods were actually delivered not in Bihar but in Bengal and that therefore the Explanation did not apply. The argument in support of the first ground was that as the Explanation enacts that the sale or purchase-not merely the sale-must be deemed to have taken place in the delivery State, it must be construed in the light of the presumption that the laws of a State are intended to operate on persons or things within its territory, and so construed, it should be held to authorise the levy of a tax on the seller only if he was within the State or on the purchaser who must be within the territory. The assumption on which this argument rests is that States have jurisdiction only over persons and property within their territory: but this, as already shown, is not correct. A State has jurisdiction to enact laws in respect of acts and events which occur within its territory, and if a sale takes place within the State as under the Explanation it does by a legal fiction, then its jurisdiction to enact a law imposing a tax thereon is complete, and no question of its overstepping its territorial limits arises. It should also be noted that the scope of the presumption that the laws of a State are not intended to operate outside its territory is, as stated by , that \" does not design its Statutes to operate on its subjects beyond the territorial limits of the United Kingdom\" ('s Interpretation of Statutes, 10th Edn., page 145). That has reference to extraterritorial operation in the second sense. There is no presumption that the laws of a State made with reference to acts and events occurring within its borders are not intended to have operation outside its territory. Moreover, a tax on sale of goods is, as observed in (1) \"a tax levied on the occasion of the sale of goods\" and the liability to tax arises \"on the occasion (1) A.I.R. 1942 F.C. 33. ", "833 ", "of a sale\". . (1), it was stated that the sales tax was a tax imposed \"on the occasion of the sale as a taxable event\". It is thus, in essence, a tax levied on the act of buying and selling. Sale is the result of a contract, and is bilateral in character. There can be seller only in relation to a purchaser and vice versa. It therefore follows that the power to impose a tax on sale imports a power to tax either the seller or the purchaser. (1), the question was raised for decision whether Entry 48 in the Provincial List of the Government of India Act 1935 \"tax on sale of goods\" included a power to impose a tax on the purchaser. It was held that it did, and it was observed that when Entry 54 in List II of the Seventh Schedule of the Constitution substituted for the words \"tax on sales\" occur- ring in Entry 48 the words \"tax on sale or purchase\", it did not thereby enlarge the powers previously conferred by Entry 48 but \"merely expressed in clearer language what was implicit in that corresponding entry\". When article 286(1)(a) and the Explanation refer to a sale or purchase, they merely conform to the terms of Entry 54, and these words cannot therefore be construed as splitting up the power to tax sales into two parts, one available against the purchaser at all times, as in the very nature of it he must be within the , and the other against a seller if he is within jurisdiction. The power is one and indivisible to be exercised when the conditions mentioned in the Explanation are satisfied against either a seller or buyer as the might determine. ", "The language of the Explanation, it should be marked, does not impose any limitation or condition on the exercise of this power. It is general and unqualified, and will comprehend all cases in which goods are delivered for consumption in the taxing State irrespective of whether the seller is within the State or not. To hold that the tax could be imposed on a seller only if he is within the State would be to (1) [1953] S.C.R. 1069. ", "(2) [1954] S.C.R. 1117. ", "834 ", "add words to the Explanation which are not there., and for this, there is no justification. On the other hand, there are good reasons why - the power should have been vested in the legislature to determine whether it will tax the seller or the buyer. The tax imposed under the Explanation really falls on the consumer-purchaser. While it is possible that with reference to certain classes of goods the tax can effectively be imposed on the purchaser, it must happen that with reference to other kinds of goods as, for example, medicines in the present appeal, it cannot be so done, and, as already pointed out, it is a \"familiar and sanctioned device\" to make the seller the agent of the for collection of taxes. In leaving it to the s to determine whether they will tax the seller or the buyer, the Explanation has merely given recognition to a familiar principle of taxation laws sanctioned by usage and upheld by authority. This objection must accordingly be overruled. It was then contended that the sales proposed to be taxed did not take place in Bihar as the goods were actually delivered as contemplated by the Explanation not there but in Bengal. The argument is that the words \"actual delivery\" in the Explanation are used in contrast to constructive or symbolic delivery as meaning physical delivery of goods, that under section 39(1) of the Sale of Goods Act, 1930 (Act III of 1930) the common carrier is the agent of the purchaser, and that therefore delivery of the goods to the railway authorities in Bengal was actual delivery thereof to the purchaser in Bengal. Section 39(1) is as follows: \"Where in pursuance of a contract of sale, the seller is authorised or required to send the goods to the buyer, delivery of the goods to a carrier whether named by the buyer or not, for the purpose of transmission to the buyer, or delivery of the goods to a wharfinger for safe custody is prima facie deemed to be a delivery of the goods to the buyer\". ", "It is difficult to see what there is in this section to support the contention that delivery to a common carrier is actual delivery to the purchaser. The section ", "-does not say so. On the other hand, it proceeds on the assumption that there was, in fact., no delivery to the purchaser, actual or otherwise, a thing a being deemed to be something only, when as a fact it is not that, and then enacts on that basis a fiction that delivery to a common carrier shall be deemed prima facie to be delivery to the buyer. What is the purpose of this fiction? It is, as will be clear from section 39(2) , to fix on whom the loss is to fall in case the goods are lost or damaged in course of transit. But where no such question arises, the fiction has to be ignored, and the matter will have to be decided on the factual basis whether the goods were actually delivered. A reference to section 51 (I) of the Sale of Goods Act is very instructive. It runs as follows: ", "\"Goods are deemed to be in course of transit from the time when they are delivered to a carrier or other bailee for the purpose of transmission to the buyer, until the buyer or his agent in that behalf takes delivery of them from such carrier or other bailee\". In this clause, the word \"delivery\" is used to denote both the delivery of goods by the seller to the common carrier and the delivery to the purchaser by the common carrier. They cannot both be actual deliveries, as goods sold under a sale can actually be deli- vered only once. If the delivery of the goods to the common carrier was actual delivery, then what is the nature of delivery when the purchaser took possession of the goods from the common carrier? It is also physical delivery of the goods, and is therefore actual delivery on the appellant's own definition. ", "The fact is that while for some purposes delivery to the common carrier is treated as delivery to the purchaser, there is delivery in fact and in its popular sense, only when the purchaser obtains possession of the goods and it is this that is connoted by the words \"actual delivery\". When section 51 (I) refers to delivery to buyer or his agent, it refers to actual delivery, and delivery to common carrier is regarded as constructive, having regard to section 39(1) . The section, it will be noticed, proceeds on the. footing that a common carrier is not the agent of the buyer with reference to actual delivery. He is the agent of the purchaser for transmission of the goods to him. ", "This position was well-established in the common law of England, and was thus stated by , B., in v. Griffin(1) in the following terms: ", "\"The delivery by the vendor of goods sold to a carrier of any description, either expressly or by implication named by the vendee, and who is to carry on his account, is a constructive delivery to the vendee; but the vendor has a right if unpaid, and if the vendee be insolvent, to retake the goods before they are actually delivered to the vendee, or some one whom he means to be his agent, to take possession of and keep the goods for him, and thereby to replace the vendor in the same situation as if he had not parted with the actual possession........ The actual delivery to the vendee or his agent, which puts an end to the transitus or state of passage, may be at the vendee's own warehouse, or at a place which he uses as his own, though belonging to another, for the deposit of goods: ( v. Prettit(2): v. Pickford(3)); or at a place where he means the goods to remain until a fresh destination is communicated to them by orders from himself; v. Baldwen(4); or it may be by the vendee's taking possession by himself or agent at some point short of the original intended place of destination\". In Ex parte Rosevear China Clay Company. In Re Cock(1) , said: ", "\"The authorities show that the vendor has a right to stop in transitu until the goods have actually got home into the hands of the purchaser, or of some one who receives them in the character of his servant or agent\". ", "In the same case, the position was stated even more fully by , L.J., in the following terms: ", "\"As soon as the clay was appropriated by the vendors to this contract and was placed on board the ship, the property in it passed to the purchaser and (1) 2 M. & W. 623; 115 E.R. 906, 910. ", "(2) [1803] 3 B. & P. 469. ", "(3) [1817] 8 Taunt. 83. ", "(4) [1804] 5 East 175. ", "(5) 11 Ch. D. 560. ", "837 ", "at the same time as between the vendor and the purchaser, there was a delivery of the claim to the latter. But it was a constructive not actual delivery\". ", "The same learned Judge again observed in v. Marshall(1) as follows: ", "\"Where the goods have been appropriated by the 7 vendor, and have been delivered by him to a carrier to be transmitted to the vendee, a constructive possession exists in the vendee\". The law as declared in the above decisions was embodied in section 32(1) of the English Sale of Goods Act, which has been reproduced in section 51 (1) of the Indian Sale of Goods Act Vide also Benjamin on Sales, Eighth Edn., page 889 where the possession of the carrier on behalf of the, buyer is stated to be \"constructive though not yet actual possession\". It must accordingly be held that the expression \"actual delivery\" in the Explanation to article 286(1)(a) means delivery of the goods to the purchaser or his agent, and delivery to the common carrier is not actual delivery, and that, in this case, the goods were actually delivered not in Bengal when they were delivered to the common carrier but in Bihar when they were delivered to the purchaser. This contention of the appellant must also be rejected. ", "In the result, the appeal should, in my judgment, be rejected with costs. ", "SINHA J.-I have had the advantage of perusing the judgments prepared by my brothers, , , and . After a careful and anxious consideration of the two viewpoints contained in the judgments respectively of my brother holding that the previous decision of this court in . (2) should be overruled, and of my brother that it should be followed, I have come to the conclusion that the latter view is more acceptable. ", "We are all agreed that the present case is governed (1) 11 Q.B.D. 356, 364. ", "(2) [1953] S.C.R. 1069. ", "838 ", "by the previous decision of this just referred to and that if that case lays down the correct rule of law, this appeal should be dismissed. We are also agreed that the language of article 286 of the Constitution on which the case depends is not felicitous and free from vagueness, with the result that the interpretation of that article is not free from doubt and difficulty. The very fact that in the case referred to, as also in the later decision of this reported in (1) involving the construction of article 286 , the was divided in its opinion shows that the interpretation of the articles in question is by no means easy. The fact that the is sharply divided in the present case also emphasizes the difficulty. The question we have to determine at the outset is whether or not we should follow the previous decision of this in .(1). We are all agreed that in a proper case it is permissible for this to go back upon its previous decision; but we are again divided as to whether this is a fit occasion for reviewing its previous decision. For the reasons given by my brothers, and , I would agree with them in holding that sufficient grounds have not been made out for overruling that decision which bad been taken after bearing, all the parties interested in the result of the case. Not only the parties directly concerned with the case but a number of States by way of interveners as in the present case were also heard. After giving a very full hearing the gave its judgment which is a very elaborate one,-the report of the case running into 60 pages in print. It is true that much can be said for the opposite view as adumbrated in the judgment of my brother ; but, in my opinion, simply because another view may be taken of the points in controversy is not a sufficient justification for our reviewing the previous judgment of this . It has not been suggested that any relevant provisions of the Indian Constitution or any (1) S.C.R. 53. ", "(2) [1958] S.C.R. 1069. ", "839 ", "other provision of law had been overlooked by this when it pronounced its previous ruling; nor has it been suggested that this on the previous occasion proceeded on erroneous suppositions. Under the Constitution and even otherwise this is naturally looked upon by the country as the custodian of law and the Constitution, and if this were to review its previous decisions simply on the ground that another view is possible, the litigant public may be encouraged to think that it is always worthwhile taking a chance with the highest court in the land. Definiteness and certainty of the legal position are essential conditions for the growth of the rule of law. In my opinion, therefore, this should review its previous decisions' only in exceptional circumstances as is the practice of in the cases referred to by my brothers and . If this has taken a view of the relevant provisions of the Constitution which does not commend itself to the acceptance of the , the latter can make necessary amendments, as has been done in the recent past. ", "Coming to the merits of the case in hand, we are all agreed that the Explanation to article 286(1) (a) of the Constitution has created a legal fiction as a result of which a transaction of sale or a purchase partaking of an inter- character has been treated as a domestic transaction. The fiction has localized sales or purchases contemplated by the Explanation, by converting such transactions as would otherwise have' been inter- sales or purchases into sales or purchases inside one in a sense in which it is placed in a class distinct and separate from what is referred to as sales or purchases \"outside the state\" in the main body of article 286(1) (a) which prohibits imposition of tax by any . There is a general agreement amongst us, I take it, that the main purpose of creating the fiction is to prevent multiple taxation of the same transaction, but, it may be added, not altogether to stop the taxation of such transactions. We are' also agreed that full effect must be given to the legal fiction on the supposition that the putative state of affairs is the real one. While thus agreeing on the general principle bearing on the question of the purpose and scope of a legal fiction, we are again divided on the question of how far the legal fiction should be carried in its actual application. For the reasons given by my brother , I agree with him that the fiction created by the Explanation brings such a sale within the taxing power of the within which such a sale is said to have taken place. Such a result is brought about not by holding that the Explanation has conferred positively the power on the relevant to impose sales tax, but by holding that such an inside sale is beyond the scope of the prohibition contained in the main body of article 286 (1) ", "(a) which interdicts the imposition of a tax on a sale \"outside the State\". The Explanation has got to be read as an integral part of article 286(1) (a) and thus read, it means negatively that a sale or purchase outside a State cannot be taxed; and by necessary implication, that a sale or purchase inside a State may be taxed by that State as falling outside the mischief of the prohibition directed against the imposition of a tax on a sale or purchase of goods outside a State; in other words, as soon as a sale or purchase of goods is declared to be outside the pale of the prohibition contained in article 286(1)(a ), the State's power of imposing a tax contained in article 246 read with item 54 of List II of the 7th Schedule comes- into operation. I do not find myself in agreement with the view propounded by my brother chiefly because that view goes beyond the purpose of the creation of the fiction which admittedly was to prevent multiple taxation. The view as propounded by him besides preventing multiple taxation goes to the length of prohibiting any imposition of sales tax by any State. Such, in my opinion, was not the intention of the Constitution. Whereas the imposition of multiple sales tax on transactions of sale or purchase may be an obstacle to the free flow of inland trade and commerce, the imposi- tion of sales tax by a single State in which the sale, is deemed to have taken place by virtue of the Explanation cannot be predicated as having such an effect. The view propounded by my learned brother is thus not inconsistent with the avowed purpose of the Constitution, as expressed in article 301 , which provides that trade, commerce and intercourse shall be free throughout the territory of India. In my opinion, the view propounded by my learned brother about the actual application of the legal fiction stops short of giving full effect to that fiction. Allied with this question is the controversy as to whether clause (2) of article 286 is subject to article 286(1)(a) read with the Explanation or vice versa. In my opinion, for the reasons given by my learned brother the better view is that clause (2) of article 286 of the Constitution is subject to article 286(1)(a) read with the Explanation. On the whole, therefore, I would agree with the view that the previous decision of this Court in 1953 S.C.R. 1069 should continue to hold good and govern the present controversy also. In that view of the matter I would dismiss this appeal with costs. ", "BY THE COURT.-The appeal is allowed and an order shall be issued directing that, until by law provides otherwise, the of Bihar do forbear and abstain from imposing Sales Tax on out-of dealers in respect of sales or purchases that have taken place in the course of inter- trade or commerce even though the goods have been delivered as a direct result of such sales or purchases for consumption in Bihar. The must pay the costs of the appellant in this and in the below. The interveners must bear and pay their own costs. ", "842"], "relevant_candidates": ["0000114104", "0000127667", "0000139104", "0000154519", "0000204111", "0000233559", "0000251775", "0000332955", "0000424874", "0000768449", "0000795066", "0000882976", "0000970874", "0001008845", "0001032035", "0001266379", "0001334665", "0001385203", "0001385734", "0001467661", "0001467985", "0001493058"]} {"id": "0000624350", "text": [", J. ", "1. The following questions have been referred to this court at the instance of the under section 256 of the Income-tax Act, 1961: ", "\"For the assessment year 1968-69: ", "(1) Whether, on the facts and in the circumstances of the case, the was justified in allowing the deduction for expenditure of Rs. 8,400 being the rent of the guest house, under section 30 of the Income-tax Act, 1961, for the assessment year 1968-69 ? ", "(2) Whether, on the facts and in the circumstances of the case, the was right in holding that the assessee was entitled to deduct the expenditure of Rs. 6,060 for the maintenance of the guest house under section 37(3) of the Income-tax Act, 1961, for the assessment year 1968-69 ? ", "For the assessment year 1969-70: ", "(1) Whether, on the facts and in the circumstances of the case, the was justified in allowing the deduction for expenditure of Rs. 4,200 being the rent of the guest house, under section 30 of the Income-tax Act, 1961, for the assessment year 1969-70 ? ", "(2) Whether, on the facts and in the circumstances of the case, the was right in holding that the assessee was entitled to deduct the expenditure of Rs. 2,770 for the maintenance of the guest house under section v of the Income-tax Act , 1961, for the assessment year 1969-70 ? ", "(3) Whether, on the facts and in the circumstances of the case, the erred in law in holding that the sum of Rs. 22,275 was not assessable under section 41(1) for the previous year relevant to the assessment year 1969-70 ?\" ", "2. The first two questions raised for the assessment year 1969-70 are identical to those raised for the assessment year 1968-69 except for the amounts mentioned therein. Counsel are agreed that the two common questions are covered by this court's judgment in the assessee's own case for the assessment year 1967-68 in Income-tax Reference No. 99 of 1976, dated November 18, 1988 (see [1989] 177 ITR 124) and that following the said judgment both the common questions have to be answered in the affirmative and in favour of the assessee. ", "3. Accordingly, the common questions are so answered. ", "4. Facts pertaining to the third question relating to the assessment year 1968-70 are: The assessee-company credited a sum of Rs. 79,492 to its profit and loss appropriation account. Out of this amount, the assessee conceded that it was liability to pay tax on Rs. 49,959. As regards the balance amount of Rs. 22,275 the assessee-company admitted that this amount represented commission payable to BE in an earlier year, the amount was allowed as deduction. The commission was not claimed by for the past many years. During the previous year, the assessee-company debited 's account and credited its profit and loss appropriation account. Yet, the assessee-company claimed that the amount was not taxable despite the fact that it was written off in the aforesaid manner. The assessee's contention that the act of writing off on its part did not amount to remission or cessation of its liability which was the requirement of section 41(1) of the Income-tax Act, 1961, was rejected by the Income-tax Officer who brought the aforesaid amount of Rs. 22,275 to tax under section 41(1) . The Appellate Assistant Commissioner confirmed the inclusion of the amount under section 41(1) . On further appeal, however following its earlier order in the assessee's won case for assessment year 1967-68, the accepted the assessee's case that the amount of Rs. 22,275 was not taxable as its income under section 41(1) of the Income-tax Act, 1961. According to the , its conclusion was fortified by this court's decisions in 49 ITR 578, 54 ITR 167 and 62 ITR 34. ", "5. , learned counsel for the , submitted that the had not appreciated the decision of this court properly. When certain expenses were allowed as deduction in the past, such amount of expenses is deemed to be the assessee's income under section 41(1) of the Income-tax Act as soon as and to the extent there is remission or cessation of liability in respect thereof. The only question requiring consideration was whether the assessee's liability still continued. In this context, he stated that the assessee's conduct in written off the liability by debiting the account of and crediting correspondingly the profit and loss appropriation account clearly indicated that it had no intention of making payment to even if it was demanded. ", "6. According to , the legislative intention as regards this provisions was clear. It was to tax such amounts which were allowed as deductions and which were ultimately not paid and were not to be paid by the assessee. Assuming there was some lacuna in the provisions of section 41(1) , he submitted, this court should fill up the lacuna by supplying necessary words in the provisons. In support of his contention, relied on number of decisions of this court and other to which we propose to refer in the course of our judgment. ", "7. , learned counsel for the assessee, on the other hand, reiterated the reasons given in support of the conclusion. In particular, he urged that the question was squarely covered by the decision of this court referred to by the in its order in the assessee's favour. He brought to our notice other decisions of this court and other decisions of this court and other which, accordingly to him, supported the 's order. We shall make reference to those judgments also to the extent necessary in the course of the judgment. ", "8. Section 41(1) of the Income-tax Act, 1961, reads thus: ", "\"41(1) Where an allowance or deduction has been made in the assessment for any year in respect of loss, expenditure or trading liability incurred by the assessee, and subsequently during any previous year the assessee has obtained, whether in cash or in any other manner whatsoever, any amount in respect of such loss or expenditure or some benefit in respect of such trading liability by way of remission or cessation thereof the amount obtained by him or the value of benefit accruing to him, shall be deemed to the profits and gains of business or profession and accordingly chargeable to income-tax as the income of that previous year, whether the business or profession in respect of which the allowance or deduction has been made is in existence in that year or not.\" ", "9. Broadly speaking, the sub-section applies only if, (i) an allowance or deduction had been made in the assessment for any year in respect of the loss. Expenditure or trading liability incurred by the assessee and (ii) in subsequent years, the assessee had obtained any benefit in respect of the amount so allowed as deduction by way of remission or cessation. As regards the first condition, admittedly, the amount of Rs. 22,275 represented commission claimed as payable by the assessee to in one of the past assessment years and the assessee's claim for deduction was allowed went a credit entry was made in favour of . As regards the second condition, there is, of course, a dispute between the parties. According to the , the liability being barred by limitation and the assessee having written it off by correspondingly crediting its profit and loss appropriation account, ceased or got remitted within the meaning of section 41(1) of the Act. The assessee contends that it is not so. When a liability is barred by limitation, what happens is that the remedy of the creditor is barred. The liability of the debtor (in this case the assessee) is never barred so long as he had the intention of honoring the liability. ", "10. For appreciation of the rival contentions in this regard, it is desirable to first refer to the judgments of this court railed upon before us. The first judgment cited is in the case of 49 ITR 578. In that case, the income-tax authorities had concluded the amount of Rs. 30,190 in the income of the assessee on the ground that the liability pay had ceased by reasons of the expiry of the period of three years. The assessee had not written off the liability in its accounts. It was on these facts that this court held that merely because the remedy of the creditors to recover the amount is barred, the assessee's liability did not cease and that, therefore, the amount was not taxable under the provision of section 10(2A) of the Income-tax Act, 1922, corresponding to section 41(1) of the Income-tax Act, 1961. The second decision is 62 ITR 34. In this case, certain amounts were add owed as deduction in the past in respect wages, salary an bonus payable to the employees. The liabilities in respect thereof were written off during the previous year, the remedy was apparently barred by limitation. The 's contention that the liabilities had ceased and section 10(2A) of the 1922 Act (corresponding to section 41(1) of the new Act) was applicable was rejected by this court observing at page 41 as under: ", "\"....... The question to be considered is whether the transfer of these entries about a remission cessation of its liability. The transfer of an entry is a unilateral act of the assessee, who is a debtor to its employees, we fail to see how a debtor, by his own unilateral act, can bring about the cessation or remission of his liability. Remission has to be granted by the creditor. It is not in dispute, and it indeed cannot be disputed, that it is not a case of remission of liability. Similarly, a unilateral act on the part of the debtor cannot bring about a cessation of his liability. The cessation of the liability may occur either by reason of the operation of law, i.e., on the liability becoming unenforceable at law by the creditor and the debtor declaring unequivocally his intention not to honor his liability when payment is demanded by the creditor, or a contract between the parties, or by discharge of the debt - the debtor making payment thereof his creditor. Transfer of an entry is neither an agreement between the parties not payment of the liability.\" ", "11. Thus, this court, in its above judgment, held that the cessation of the liability may occur either (i) by reason of operation of law, i.e., on the liability being unenforceably at law by the are creditor and the debtor declaring unequivocally his intention not to honour his liability when payment is demanded by the creditor, or (ii) by contract between the parties, or (iii) by discharge of the debt - the debtor making payment thereof his creditor. There are, thus, three alternative situations contemplated in this decision which would result in the cessation of the liability. However, in that case, the liability pertained to wages, salaries and bonus due by an employer to his employees in an industry so much so that the provisions of the Industrial Disputes Act were attracted and consequently the bar of limitation did not come in the way of the employees. In these circumstances, this court held that there was no cessation of the liabilities and, therefore the amounts could not be treated as income of the assessee under section 10(2A) of the Indian Income-tax Act, 1922. ", "12. 102 ITR 428, this court held that neither remission not cessation of liability could take place by unilateral act on the part of the debtor and, therefore, merely because the amount was transferred from \"unclaimed balances account\" to \"reserve for taxation account\" it will not become taxable under section 10(2A) of the Act of 1922. That the decision was given on the facts of that case is evident from the emphasis laid on the fact that some payments were made out of these accounts as and when demanded by the parties and for this reasons the transfer of amounts from \"unclaimed balances account\" to \"reserve for taxation account\" did not mean cessation of liability. The question involved in the case of . 149 ITR 604, was not regarding the remission or cessation of liability at all. It was whether the surplus deposits made by the customers were trading receipts in the hands of the assessee. It was held that the excess deposit were to held by the assessee for the benefit of the depositors. The deposits were in respect of specific transactions of sales and were adjusted towards the purchase price of the machinery sold. It had close connection with the transactions of sales. Since the assessee transferred the excess deposits remaining in its hands to the profit and loss account during the previous year, such excess amounts were assessable to tax as trading receipts in the hands of the assessee. The provisions of section 10(2A) of the old Act of 1922 and section 41(1) of the new Act of 1961 were not even referred to and/or examined in this decision. ", "13. To sum up, so far as these court is concerned, the settled legal position appears to be what was stated by this court in its judgment in 's case [1966] 62 ITR 34. The liability of an assessee does not cease merely because the liability has become barred by limitation and the assessee has unequivocally expressed it intention not to honour the liability even when demanded. Essentially, therefore, it will always be a question of fact whether or not the assessee has expressed unequivocally his intention not to honour the liability after it has become barred by limitation. In a given set of facts, a finding either way may be possible. In the instant case, the departmental authorities have assumed that the assessee has not intention of honoring the liability on demand from the mere fact of the assessee's writing off the liability and crediting the amount to the profit and loss appropriation account. The has held that the liability did not cease. We have to answer the question on the basis of the facts found. In the circumstances, so far as this case is concerned, it will not be possible for this court of interfere. ", "14. The decisions of other cited before us do not carry the matter further, because they followed the earlier decisions of this court. ", "15. Accordingly, the third question relating to the assessment year 1969-70 also is, on the facts, found answered in the affirmative and in favour of the assessee. ", "16. No order as to costs."], "relevant_candidates": ["0000264004", "0000920645", "0001512520", "0001856511", "0027111889"]} {"id": "0000676779", "text": ["JUDGMENT , J. ", "1. The facts found and/or admitted in these proceedings are shortly as follows : ", ", Calcutta, is the Indian subsidiary of , a non-resident company incorporated in the United Kingdom. At the material period the assesses was engaged in executing a contract awarded by , a of India undertaking. In executing the said contract the funds of the assessee to the extent of over Rs. 24 lakhs became blocked. In the circumstances, the assessee approached its parent company for a loan of 37,500 being about Rs. 5 lakhs in Indian currency at that time. The foreign principal company agreed to advance the amount to the assessee and in its letter dated the 14th January, 1965, wrote to the assessee as follows : ", "\"With reference to your application for financial assistance, we conefirm that this company would agree to make you an interest-free loan of Rs. 5 lakhs ( 37,500) for a period of one\" year, to enable you to finance the large Government contracts on which you are currently engaged. ", "No doubt you will obtain the necessary permission from the Indian Government to repay this loan in sterling, at the expiration of one year, or earlier if funds become available.\" ", "2. Thereupon, the assessee by its letter dated the 18th January, 1965, sought the approval of for the said loan of Rs. 5 lakhs ( 37,500) from the parent company with permission to repatriate the amount when required after one year or earlier if funds would become available. ", "(a) By the said letter was, inter alia, informed that the loan amount was needed to finance the said contract of . ", "(b) An amount of Rs. 24.34 lakhs was lying blocked in the contract and the assessee's overdraft with its bankers had reached the maximum limit and there was no alternative for the assessee but to obtain the said loan from the United Kingdom. ", "(c) Funds were required immediately to meet a taxation liability of Rs. 10 lakhs in January and February, 1965, apart from the continuous requirements in the said contract. ", "(d) The approval of for the loan was required immediately so that the assessee could meet the urgent taxation liabilities without default. ", "3. Necessary permission was granted by for the aforesaid loan and the assessee received the loan on the 25th February, 1965, The loan was not repaid at the expiry of one year and remained outstanding in the books of the assessee up to the 6th Jane, 1966, on which date the Indian rupee was devalued. As a result of such devaluation the asses-see found that it had to arrange for a sum of Rs. 7,87,692 to repay the original loan of 37,500, and consequently an extra amount of Rs. 2,87,692 was necessary to repay the original loan of Rs. 5 lakhs. ", "4. After deducting a gain of about Rs. 4,078 on the assessee's sterling deposit in a London bank the assessee debited its profit and loss account with a sum of Rs. 2,83,614 for the assessment year 1967-68 and claimed deduction of this amount. The rejected the claim of the assessee on the ground that the increase of liability arising from devaluation on account of the sterling loan was of a capital nature and could not be allowed as a revenue expense. ", "5. Being aggrieved, the assessee preferred an appeal and contended before the , inter alia, that the loan in question was not raised for acquiring any capital asset and the extra amount of Rs. 2,83,614 payable against the loan on account of devaluation of Indian rupee was a revenue expenditure and should have been allowed as deduction in computing the assessee's business income. The held that the loss on account of devaluation in connection with a loan could not under any circumstances be considered to be a revenue loss. Accretion in the amount of the borrowing was not admissible as a deduction. He also held that the assessee not being a dealer in foreign exchange, the loss was not incidental to its business or in the carrying on of that. Accordingly, the confirmed the disallowance of the loss. ", "6. The assessee preferred further appeal to the . It was contended on behalf of the assessee in the appeal that the said amount should have been allowed as a deductible expenditure under Section 37(1) of the I.T. Act, 1961, as a loss incidental to the business. It was contended further that, although the loan had not been repaid during the year in question as the assessee's accounts were kept according to the mercantile system, the liability having arisen in the year by reason of the devaluation, it was in the nature of an expenditure incurred by the assessee and, therefore, allowable under Section 37 . It was contended that the expenditure for the purpose of business included the payment of the assessee's statutory dues and taxes. It was submitted that the loan had been taken by the assessee for the. purposes of its business and the loss occasioned by devaluation was suffered in the business. ", "7. The revenue on the other hand contended that the alleged expenditure and/or loss was not allowable inasmuch as : (a) no expenditure had been incurred ; (b) even if such expenditure was incurred it had not been laid out or expended wholly or exclusively for the purpose of the assessee's business; and (c) the expenditure and/or loss was capital in nature inasmuch as it went to increase the amount of loan which the assessee was required to pay to its principal. It was contended that, in any event, the loss arising out of devaluation could not be allowed as a loss incidental to business. It was finally submitted that the loss, if any, was of a capital nature. There was no change in the amount of loan and the provision for a higher amount for repaying the loan could not be called a revenue expenditure as it was related to capital and was connected with the return thereof. ", "8. The , inter alia, noted that no evidence had been adduced to show the probable date of repayment of the said loan. On the date of the devaluation the original period for repayment, i.e., one year, had already expired. Accordingly, the held that the assessee was not required to repay the loan on the 6th June, 1966, or that any liability for the expenditure of the extra amount of Rs. 2,83,614 arose on that date. The held further that the liability to pay the extra amount, if any, was a contingent liability. ", "9. On the authority of in Indian Molasses Co. (P.) 37 ITR 66, the Tribunal held that the assessee did not actually incur any expenditure which would qualify for allowance under Section 37 . ", "10. The also found that the assessee required additional funds and obtained the said loan not only for financing its business but also to meet an immediate taxation liability of Rs. 10 lakhs as admitted in the letter dated 18th January, 1965, addressed to . There being no evidence as to which part of the taxation liabilities was met out of the loan, the concluded from the said letter that the major requirement of the assessee was to meet the taxation liabilities. Following a decision of this court in 58 ITR 84 (Cal), the held that the expenditure it incurred was in connection with the payment of tax and could not be allowed under Section 37 . ", "11. The Tribunal held that, as no repayment was made to the principal- ", "company in the assessment year, there was no question of claiming any loss in that year. The also held, following a decision of this court in , that the loss in exchange having arisen due to devaluation, which was an act of the and an act of the Sovereign, was not a loss springing directly from the carrying on nor incidental to the carrying on of the business of the assessee and, therefore, could not be allowed also on this ground, ", "12. On the application of the assessee under Section 256(1) of the I.T. Act, 1961, and also Section 18 of the Companies (Profits) Surtax Act, 1964, the has drawn up a statement of case and has referred the following questions for the opinion of this court as questions of law arising from its order : ", "Under the Income-tax Act , 1961: ", "\"1. Whether, on the facts and in the circumstances of the case, and on a proper construction of the assessee's letter of 18th January, 1965, the was right in holding that the assessee's major requirement for its loan was to meet its taxation liabilities ? ", "2. Whether, on the facts and in the circumstances of the case, the was right in holding that the amount of Rs. 2,83,614 was not deductible in computing the assessee's profits and gains of business ?\" ", " Under the Companies (Profits) Surtax Act , 1964 : ", "\"Whether, on the facts and in the circumstances of the case, the was right in holding that the amount of Rs. 2,83,614 was not deductible in computing the chargeable profits for the purposes of the surtax assessment for the year 1967-68 ?\" ", "13. Mr. , learned counsel for the assessee, in his submissions on question No. 1 before us contended that on a proper construction of the assessee's letter dated the 18th January, 1965, it could not be said that the major requirement of the assessee in obtaining the said loan was to meet its taxation liabilities as on that date. He contended that it was clearly seen from the letter of the foreign principal that the loan was being advanced to the assessee to enable it to finance the current contract and not to meet the assessee's taxation liabilities. In the assessee's letter to it was also reiterated that the loan was necessary for the purpose of financing the contract. It also appeared from the said letter that the subject of the loan was broached prior to the 17th June, 1964, and prior to the taxation liability of 1965. On a proper construction of the said letter, which was a question of law, Mr. submitted that it could not be said that the major requirement of the assessee for the loan was for meeting taxation liability. ", "14. Mr. , learned counsel for the revenue, contended on the other hand, that the finding of the that the major requirement of the assessee was to meet the taxation liabilities was a finding of fact which had not been challenged in these proceedings as perverse or based on no evidence. He submitted that construction of ordinary correspondence did not give rise to questions of law which could arise only where legal documents Were being construed. In the instant case the has drawn a factual conclusion from the letter. ", "15. It appears to us that the question No. 1 is an academic question. In the earlier part of its order the records as follows : \".........The above facts as emerged from the letter dated 18-l-65 go to show that the major requirement before the company was to meet the taxation liabilities\". But in the latter part of the order it is recorded as follows ; \"17. Besides, as we have already stated above, the loss has arisen, if not substantially at least to a great extent, in the discharge of the assessee's income-tax liabilities......\" The latter part of the 's order which does not mention the assessee's major requirement has not been challenged and, therefore, the challenge to the earlier construction of the letter by itself does not advance the assessee's case further. ", "16. For the reasons given above we decline to answer question No. 1. On question No, 2 Mr. for the assessee contended first that the extra amount of Rs. 2,83,614, which the assessee had to provide as a result of devaluation, was in the nature of an ordinary business expenditure. It was as much an expenditure as bank or postal charges which might have had to be incurred by the assessee if the amount was remitted by post or through bank for repayment of the loan. In terms of sterling the amount of loan remained fixed but in obtaining the foreign currency the assessee had to incur an extra expenditure in rupees. This, according to Mr. , was a normal and proper business expenditure allowable under Section 37 of the Act. ", "17. Mr. submitted next that as the assessee at the relevant time maintained its accounts under the mercantile system, this expenditure was incurred during the relevant year. The moment devaluation took place, the liability for the extra amount was incurred by the assessee and had to be debited in the assessee's profit and loss account in that year. Alternatively, in providing for the extra amount on account of the devaluation, the assessee suffered a loss and such loss was connected with, incidental to and was incurred for the purpose of the assessee's business. It was a loss of a revenue nature and not of a capital nature. ", "18. Mr. , lastly, submitted that even if it was admitted that the object of the assessee in obtaining the loan was to meet its income-tax liabilities, the extra expenditure incurred in connection with such loan would also come within the ambit of the expression \"purpose of the assessee's business\" in Section 37 of the Act. Mr. submitted that by reason of the subsequent decisions of , the decision of this court in case 58 ITR 84 (Cal) was no longer good law. ", "19. Mr. , for the revenue, has contended to the contrary. He submitted first that the assessee did not incur any expenditure. Expenditure meant an actual and current disbursement. In the facts of the instant case, the assessee not having determined any particular date for repayment of the loan, no question arose of its spending anything. ", "20. Mr. next contended that the loss of the assessee, if any, by reason of the devaluation was not the loss suffered in the year. In any event, assuming that the assessee suffered a loss, the same was a capital loss and not a revenue loss and the assessee was not entitled to any deduction thereof. ", "21. Lastly, Mr. submitted that case [1965] 58 ITR 84 (Cal) was still good law and the assessee having obtained the loan with the object of meeting its income-tax liabilities did not incur any expenditure solely or exclusively for the purpose of its business nor suffered any loss therein and, therefore, was not entitled to any deduction of the extra amounts repaid on account thereof. ", "22. In support of the respective contentions of the parties a large number of decisions were cited at the . We shall refer to the following which in our opinion are of relevance in the present reference. ", "(a) 23 ITR 230. This decision of was cited on behalf of the assessee for the following observations of Bhagwati J. at page 239 on mercantile system of accounting : ", "\"The mercantile system of accounting or what is otherwise known as the double entry system......brings into credit what is due, immediately it becomes legally due and before it is actually received and it brings into debit expenditure the amount for which a legal liability has been incurred before it is actually disbursed.\" ", "(b) 37 ITR 1. This decision of was also cited by the assessee on mercantile system of accounting. ", "In this case the assessee had sold land in plots for building purposes undertaking to develop them by laying out roads, providing a drainage system and installing lights, etc. The purchaser paid only a portion of the price and undertook to pay the balance in instalments. The assessee in its turn undertook to carry out the development within six months. In the relevant accounting year the assessee in accordance with the mercantile system of accounts adopted by it, credited its accounts with the full sale price of the lands though it incurred only a part and at the same time debited an estimated sum by way of expenditure for the development undertaken though nothing had been actually spent. On these facts , inter alia, held as follows at page 10 of the report 3 : ", "\"....we find that the sum of Rs. 24,809 represented the estimated expenditure which had to be incurred by the appellant in discharging a liability which it had already undertaken under the terms of the deeds of sale of the lands in question and was an accrued liability which according to the mercantile system of accounting the appellant was entitled to debit in its books of account for the accounting year as against the receipts of Rs. 43,692-11-9 which represented the sale proceeds of the said lands.\" ", "(c) v. C1T [1959] 37 ITR 66. This decision of was also cited on behalf of the assessee for the following observations at page 76 : ", "\"Thus, in finding out what profits there be, the normal accountancy practice may be to allow as expense any sum in respect of liabilities which have accrued over the accounting period and to deduct such sums from profits. But the income-tax laws do not take every such allowance as legitimate for purposes of tax. A distinction is made between an actual liability in praesenti and a liability de future which, for the time being, is only contingent. The former is deductible but not the latter......What a prudent trader sets apart to meet a liability, not actually present but only contingent, cannot bear the character of expense till the liability becomes real.\" ", "(d) 73 ITR 53. This decision of was cited by the assessee. It was held in this case that an estimated liability, amounting to a contingent liability and not a debt under the W.T. Act, if it could be properly ascertainable and its present value could be fairly discounted, would be deductible from the gross receipts while preparing the profit and loss account. ", "(e) v. IRC [1924] 12 TC 773. This English decision was cited on behalf of the revenue. The facts in this case were that the accounting period of the assessee ended on the 30th April, 1921. Prior to that date the assessee had entered into contracts to purchase quantities of goods to be delivered between November, 1920, and December, 1921. After the contract was entered into prices fell. The assessee had received only a portion of goods by the 30th April, 1921, but in the computation of excess profits duty the assessee claimed to deduct the difference between the contract price and the market price of the undelivered goods as estimated loss. On these facts it was held on a reference that loss plaimed was only an apprehended future loss and not one suffered during the accounting period and, therefore, the deduction claimed was inadmissible. ", "(f) Whimster & Co. v. [1925] 12 TC 813. This decision was also cited on behalf of the revenue. Here the loss claimed by the assessee on unexpired time-charter of ships on the basis of an anticipated fall of freight was disallowed as a deduction. ", "(g) Alien v. Farquharson Brothers & Co. [1932] 17 TC 59 (KB). This decision was cited by the revenue for the following observations of Finlay J. at page 64 of the report to illustrate the distinction between an expenditure and a loss : ", "\"Now a case might be put in which it was not very easy to say whether a thing was a disbursement or expense or was a loss. It is conceivable--such things sometimes happen--that there may be cases in which a thing might fall alternately......But, none the less, I do think that there is a distinction to be drawn between the two. (a) relates to disbursements ; that means something or other which the trader pays out ; I think some sort of volition is indicated. He chooses to pay out some disbursement; it is an expense; it is something which comes out of his pocket. A loss is something different. That is not a thing which he expends or disburses. That is a thing which, so to speak, comes upon him ab extra.\" ", "(h) 55 ITR 716 was cited by the revenue for an observation of similar to the above as follows : ", "\"The word 'expenditure' in rule 6 of the Schedule to the Indian Income-tax Act , 1922, meant 'disbursement' and did not include depreciation.\" ", "(i) Landes Brothers v. [1934] 19 TC 62 (KB). This decision was cited on behalf of the revenue. In this case the assessee, the sole commission agent of a company for sale in Britain, which imported furs under the terms of the agency, had to advance to its principal a part of the value of each consignment to be adjusted after the sale thereof. The transactions were conducted on dollar basis and when the assessee recouped itself for the advances a profit accrued as a result of fluctuation in the rate of exchange. Such profits were held to be a part of the trading receipts of the assessee arising in the course of its business and hence taxable. ", "(j) v. IRC [1938] 22 TC 106 (CA). This decision was cited on behalf of the assessee. The facts in this case were that an English company was granted a licence to distribute within a definite territory the films of an American company. The agreement provided that the English company would pay to its American company 70% of the gross receipts less certain stipulated deductions but was silent as to the exchange basis which was to govern the transactions. At an earlier stage, the English company had been instructed to keep the accounts on the basis of a fixed rate of exchange and the difference between that rate and the rate prevailing at the end of the week in which the transaction took place was directed to be passed on to a suspense account. The books of the English company were maintained throughout on this basis. Owing to a delay in the adjustment of accounts between the two companies and a fall in the value of sterling in relation to dollar large adverse differences were shown in the suspense account. The English company was initially assessed to income-tax without regard to the suspense account but subsequently preferred claims for relief on the ground that the adverse differences in exchange as shown in the suspense account were deductible in computing its profits. It was held by that the contractual relationship of the parties established that the English company's debts to the American company were dollar debts and, therefore, the reliefs claimed should be allowed. ", "(k) Davies v. Shell Company of China Ltd. [1952] 22 ITR (Supp) 1; [1951] 32 TC 133 (CA). In this case, cited by the revenue the assessee was a British company which carried on business of sale and distribution of petroleum products in China through agents from whom the assessee obtained deposits at the termination of the agency. When hostilities between China and Japan broke out the assessee transferred the amounts of deposits to the United Kingdom and retained the same in sterling. Owing to subsequent depreciation of Chinese dollars in relation to sterling, the amounts eventually required to repay the deposits in Chinese currency were much less than the amounts held by the assessee and a substantial profit accrued to the latter. It was held that such profits were capital profits and hence not taxable. The relevant observations in the judgment of at pages 147 and 156 are set out as follows : ", "\"The sum paid is a deposit...It is not however a payment in advance...It has the character of a loan in that it is repayable at the determination of the agency by the company, and also in that it has to carry interest at a fixed rate per cent. per annum. \" ", "P. 156 : \"It is to be available during the period of the agency for making good the agent's defaults in the event of any default by him ; but otherwise it remains, as I see it, simply as a loan owing by the company to the agent and repayable on the termination of the agency ; and I do not see how the fact that the purpose for which it is given is to provide a security against any possible default by the agent can invest it with the character of a trading receipt.\" ", "(l) . The facts in this case cited by the revenue were that the assessee who carried on business in yarns received from its customers sums which they claimed to be \"borrowed money\" within the meaning of the Excess Profits Tax Act and as such not chargeable to excess profits tax. The revenue authorities, the and rejected the contentions of the assessee. On a final appeal, , however, found that a part of the deposits from the customers of the assessee had no connection with the price of the yarn to be supplied, but were to be held as security for due performance of the contract and that the assessee had to pay the interest on the amounts. Ultimately, unless there was adjustment against liability, the amount had to be returned. ", " held that the transaction was essentially a contract of loan. considered [1952] 22 ITR (Supp) 1; [1951] 32 TC 133 (CA), and noted that similar deposits were treated as capital receipts and profits thereon by reason of fluctuation of the exchange rate would be capital gain. ", "(m) 35 ITR 519 was also cited by the revenue, where again considered Shell Company of China Ltd. 22 ITR (Supp) 1; 32 TC 133 (CA) and construed it in the same manner as in . ", "(n) was cited on behalf of the assessee. It was contended that this decision had a departure from Shell Company of China Ltd. 22 ITR (Supp) 1 ; 32 TC 133(CA). ", "In this case, the assessee spent a substantial sum towards stamp duty, registration fees, lawyer's fees, etc., in obtaining a loan from secured by a charge on its fixed assets. upheld the assessee's claim that the said expenditure was deductible as a revenue expenditure (p. 63) : ", "\"...we are of the opinion that : (a) the loan obtained is not an asset or advantage of an enduring nature ; (b) that the expenditure was made for securing the use of money for a certain period ; and (c) that it is irrelevant to consider the object with which the loan was obtained. Consequently, in the circumstances of the case, the expenditure was revenue expenditure within Section 10(2)(xv) . \" ", "(o) . 71 ITR 761 (Bom). This decision of was cited by the assessee. In the relevant assessment year the assessee, an insurance company, claimed deduction of a loss. It was alleged that such loss had been incurred by reason of devaluation of the Pakistan currency on the 31st July, 1955. On that date an amount in Pakistan rupees was due from the Pakistan Government to the assessee on account of advance payment of income-tax. An amount was also due and payable to the assessee under the double taxation avoidance agreement between India and Pakistan. As a result of devaluation the amounts so due and payable were reduced. The assessee alleged that it had suffered a loss and claimed a deduction thereof from its business income. held as follows (p. 797): ", "\"It is clear, therefore, that when the difference arose it was a difference which was entirely independent of the volition of the assessee. At no stage did the assessee intend to lay out this amount for any expenditure but, on the other hand, it was fortuitous circumstance that Pakistan devalued its currency that resulted in this difference. It was, therefore, upon the tests laid down in the authorities, clearly a business loss which the assessee incurred.\" ", "23. In the facts of this case as found we are unable to accept the contention of the revenue that notionally the expenditure, if any, incurred by or any loss accruing to the assessee by reason of the devaluation did not arise in the year of assessment. The assessee admittedly maintained its accounts on mercantile basis. On devaluation of the Indian currency the liability of the assessee immediately increased to the extent the rupee was devalued and the assessee became liable to pay and/or spend an extra amount in rupees in order to pay its dues. This liability accrued during the relevant period. In the event this debt would be remitted or would become irrecoverable from the assessee in future then under Section 41 of the I.T. Act, 1961, the same would again be treated as income accruing to the assessee. The liability of the assessee during the relevant period cannot be said to be a contingent liability or an anticipated future loss. On such facts the instant case is clearly distinguishable from the decisions cited by the revenue, i.e., 12 TC 773 and 12 TC 813 and the principles laid down in the said decisions have no application in the instant case. ", "24. The enquiry as to whether by reason of the devaluation the assessee has incurred an expenditure or has suffered a business loss is, in our view, of little relevance. No doubt, an expenditure is something which directly goes out or is deemed to go out of the pocket or till and a loss may fall on a business without any immediate liability to pay or disburse anything. There also may be cases where a loss arising from causes ab extra may necessitate immediate expenditure. But in all such cases, the expenditure as also the losses, if they are business losses, have to be taken into account and deducted in determining the profit. Therefore, the distinction between loss suffered without any immediate disbursement and an expenditure incurred would be of not much significance. ", "25. The question which in our view is of real importance in the instant case is whether the loss or expenditure of the assessee as a result of the devaluation is of a capital nature or of a revenue nature. Mr. , for the assessee, has contended in the course of his submissions that a loss has to be considered in a different way from a gain in computing business profits. There may be cases where a loss de hors the business is allowed as a business loss, whereas a gain arising in similar circumstances will never be a business gain. In our view this distinction again is of little significance as the gain or the loss, as the case may be, has to be connected with the business before the same can enter into the computation of profits. ", "26. On a scrutiny of the facts of the instant case it appears to us that as a result of the devaluation which befell the assessee, it became immediately liable to an extra liability in terms of its rupee assets for repayment of its debts. This extra expenditure, deemed or otherwise, or this loss, is inextricably connected with the assessee's indebtedness and did not arise de hors the indebtedness nor was it incurred for the purposes of the loan and it was, as, if, from the date of the devaluation the dues from the assessee to its creditors in rupees were increased. We are unable to accept the contentions of Mr. that the extra amount which the assessee had to provide for as a result of the devaluation is to be considered as extra expenditure to be incurred for meeting the debt just as postal expenses or bank charges or this extra expenditure which would result in a business loss of a revenue nature. ", "27. In our view, the propositions laid down in the case of [1952] 22 ITR (Supp.) 1 ; [1951] 32 TC 133 (CA) apply on all fours to the instant case. If there would have been a devaluation in favour of the rupee as a result of which the assessee had to pay less to its creditors, the surplus arising would have been of capital nature and could not have been assessed in the hands of the assessee as a business profit. Conversely as a result of the exchange rate going against the assessee the loss which the assessee incurred cannot be held to be a revenue loss. considered [1952] 22 ITR (Supp.) 1 ; [1951] 32 TC 133 (CA) in K.M.S. Lakshmanier & Sons and . The ratio in the said English decision and the principle laid down therein were accepted and approved by . The instant case can also be distinguished from the decision of in . It was decided in that case that any expenditure incurred for securing the use of money for a certain period, i.e., for the purpose of obtaining a loan which was not an asset or advantage of an enduring nature, was a revenue expenditure, and that the purpose for which the loan was obtained was irrelevant in deciding whether such expenditure would be a capital expenditure or a revenue expenditure. In the instant case it is not contended by the assessee that it had incurred the extra expenditure in order to secure the loan. The loan had already been obtained. It is at the point of repayment that the assessee has to provide an extra amount in rupees by reason of the devaluation. ", "28. For the reasons given above We answer question No. 2 in the affirmative and in favour of the revenue. ", "29. A large number of decisions were cited and extensive submissions were made on the aspect whether an expenditure incurred or a loss suffered in respect of money borrowed for the purpose of payment of income-tax would be deductible as a business expenditure or a business loss. Inasmuch as we hold that the loss suffered or expenditure incurred is not deductible as it is of capital nature, it is not necessary for us to consider this aspect of the matter any further. ", "30. The question referred to under the Companies (Profit) Surtax Act, 1964, is a question consequential to question No. 2. By reason of the answer given to question No. 2, we answer this question also in the affirmative and in favour of the revenue. There will be no order as to costs. ", ", J. ", "31. I agree."], "relevant_candidates": ["0000012637", "0000105278", "0000416340", "0000656021", "0000756197", "0000791231", "0001461059", "0001512520", "0001693454", "0001760681", "0001904485"]} {"id": "0000688536", "text": ["CASE NO.: Appeal (civil) 7088 of 1999 PETITIONER: MUNICIPAL COUNCIL, AHMEDNAGAR AND ANR. RESPONDENT: AND ORS. DATE OF JUDGMENT: 08/12/1999 BENCH: S.B. MAJMUDAR & JUDGMENT: ", "JUDGMENT 1999 Supp(5) SCR 197 The Judgment of the Court was delivered by , granted. ", ", Ahmednagar and another are in appeal against an order of (Aurangabad Bench) in Writ Petition No. 1156 of 1993, wherein the Writ Petition filed by the respondent Nos. 1 to 3 herein, and two others was allowed and was directed to make over vacant possession of the land bearing CTS No. 5761-A situated at Ahmednagar to the petitioners within a period of three months from the date of the Judgment further directed the writ petitioners to refund the amount of compensation received by them for the acquired land within a period of four weeks from the date of handing over the possession of the land to them by the respondent along with certain consequential orders. The facts for the matter being singularly singular ought to be adverted to at this juncture. ", "The facts depict that the Writ Petition before was filed on 21st October, 1992, for setting aside the Award dated 26th April, 1976 in regard to CTS No, 5761' of Ahmednagar Town. Subsequent thereto, however, the Writ Petition was amended for issuance of a Writ of Certiorari for quashing and setting aside the notification dated 15th May, 1971 issued under Section I26(4)of the Maharashtra Regional and Town Planning Act, 1966 (hereinafter referred to as the Act) read with Section 6 of the Land Acquisition Act, 1994. It is on this petition that made the rule absolute and directed making over of the vacant possession of the land under acquisition within a period of three months from the date of the Judgement as noticed above. The appellants on grant of special leave to appeal are before this Court, While issuing notice on 17th December, 1998, this Court was pleased to grant an interim stay of operation of the impugned judgemient of and also directed filing of counter and rejoinder affidavits. It is in terms of this direction of the Court that the matter was taken up for hearing on 7.12.1999 and also today. ", "Upon however, hearing the submissions on behalf of the parties herein, we do feel it expedient to record that the matter can be dealt with finally on a short ground to wit, the time element. While addressing on behalf of the petitioners herein Mr. learned Solicitor General severely criticised the judgment of and contended that should have taken note of the element of delay in moving the Court. Mr. pointed out that whereas the notice for acquisition was issued in 1971 and the Award was passed and possession was taken in the year 1976, the Writ Petition was filed in the year 1992 i.e. to say after expiry of 21 years from the date of notification and 16 years from the date of making over possession and the Award. ", "Incidentally this point of delay and laches was also raised before and on this score relying upon the decision in 's case , 1 MHLJ 503, observed that it is not an inflexible rule that whenever there is delay, the must and necessarily refuse to entertain the petition filed after a period of three years or more which is the normal period of limitation for filing a suit. The Bombay High in `s case (supra) stated that the question is one of discretion to be followed in the fact arid circumstances of each case and further stated :- ", "\"The real test for sound exercise of discretion by in this regard is not the physical running of time such but the test is whether by reason of delay, there is such negligence on the part of the petitioner so as to infer that he has given up his claim or where the petitioner has moved , the rights of the third parties have come into being which should not be allowed to disturb unless there is reasonable explanation for the delay\". ", "In the Judgment Impugned in this appeal stated :- ", "\"It may be stated that in the instant case the respondent No. 2 not only failed to take steps even after passing of the Award in 1976 but attempted to change the public purpose even thereafter in 1980 and 1993. It can be seen from the discussion of the material placed before the by the petitioners that the respondent No. 2 in fact issued a public notice inviting objections to the modification in the development plan in 1993. The petitioners have in fact when realised the possibility of respondent No. 2 taking steps for changing or modifying the development plan to the extent of their land protested and has in fact lodged their objections on similar grounds which re urged in the Writ Petition. Therefore, there is a continuity in process without any break on the part of the respondent No. 2 in changing the public purpose in not giving effect to the purpose for which notification under Section 4(1) of the Act was published by the State government in exercise of its powers and in consequence passing of the Award based on such notification. In the given set of circumstances, we feel that there petitioners have had cause of action even passing of the award in challenging the very initial action on the part of the respondents in acquiring the land. It may be stated that the respondent No. 2 has not raised the contention of delay and laches in the first affidavit in reply filed on 29.6.1966. It is only in the additional affidavit in reply on 28.4 98 and that too in reply to amendment made to the Writ Petition by the petitioners that for the first time a contention is raised as to the delay and laches in filing the petition. We are afraid if the respondent No. 2 is entitled to raise this contention during the course of arguments............................................\" ", "The observations as above, with due respect are based on certain misconception of facts. While it is true that the plea of limitation ought to be raised at the first available opportunity but that does not mean and imply that the patty raising it even during the course of hearing would be barred therefrom. Limitation is a mixed question of law and fact. Time barred claim would not even be entertained by a civil court without there being nay opportunity of filing a pleading by the respondents or the defendants in a civil suit. The fact remains that the respondents herein did in fact agitate the point of limitation during the course of hearing and also had taken the peal in their affidavit in reply and prior to the commencement of the hearing of the matter. was thus clearly in error in holding without any further factual detail that the cause of action for the challenge to the Notification under the Maharashtra Act of 1966 continues even on the date of filing of the writ petition. Mr. , the learned senior counsel appearing for the respondents contended that Since his is a continuing wrong, the question of the claim being time barred or the conduct being barred under the laws of limitation does not and cannot arise. Mr. further contended that there are mala fide involved and mala fides ought not to be restricted to be challenged under the garb of limitation. ", " has in fact proceeded on the basis of the equitable principle as it appeared from the observations of as set out hereinbelow :- ", "\"In the present case, the respondent No, 2 has in fact did nothing except by passing resolution for modification of the public purpose for which the land was acquired rather than actually making use of the land for which it was acquired or possession of which was taken after passing of the award. On equitable principle me petitioners are entitled to reliefs even if there is delay in filing the Writ Petition. As a matter of fact, the petitioners have explained the circumstances in which they have invoked the extra ordinary writ jurisdiction of this Court under Article 226 of the Constitution of India. Since the petitioners have been successful in establishing the please of legal malice as against the respondent no. 2, we think that the perpetual illegal action of which has causing substantial injustice to the petitioners is required to be remedied by invoking the extraordinary jurisdiction under Article 226 of the Constitution of India in favour of the petitioners. It cannot be overlooked that while exercising the extra-ordinary jurisdiction under Article 226 of the Constitution of India may be justified in exercising its powers where justice must appear to have been done and must be done.\" ", "Incidentally, the contextual facts depict that the respondents did in fact apply for the execution of the Award in the year 1995. This aspect of the matter, unfortunately, does not find place even in the amended Writ Petition. Significantly, as found from records one I.A. was filed in the present SLP being LA. No. 1 of 1999 for dismissal of the Special Leave Petition on the ground of suppression of fact by . But what about the failure to mention the factum of the award in the writ petition? The factum of initiation of the execution proceedings was suppressed even in the amended writ petition. We are at a loss to find as to who ought to be charged with guilt of suppression of facts. ", "The records depict that by reason of the failure to obtain necessary orders from the trail court, a civil revisional application was filed before wherein has directed deposit of Rs. 3,20,116 by which sum in fact stands deposited till date. While it is trite that in the said Civil Revision has directed that further orders as regards the withdrawal of the amount of money can be had only after the disposal of the Writ Petition, but the factum of presentation of the execution application goes however to suggest that the respondents have in fact accepted the Award and wanted its execution. ", "The factual analysis in short therefore, depicts that the notification for acquisition in terms of the Act was issued in 1971, the Award was published in regard thereto in 1976 and the Writ Petition was filed in 1992. During the pendency of the Writ Petition, the respondent-writ petitioners moved an execution application so far as the Award is concerned and thereafter moved a further civil revision application before in 1995 - these factual details in our view go to negate the observations of It is significant to note that since the year 1952 this particular property which is under acquisition was reserved for school and playground. In the year 1963 the reservation was further continued and as such, there had not been any development of the plot by any concern since 1952 onwards. Another redeeming feature ought also to be noticed at this juncture, namely, the original Writ Petitioner being the father of the present respondents sent a notice in 1964 to to purchase the reserved property or to release the same in favour of the writ petitioner. But there was no assertion of right thereafter and till the issuance of the notification in 1971 and possession being delivered in terms of the award in 1976. ", " has thus misplaced the factual details and misread the same. It is now a well-settled principle of law and we need not dilate on this score to the effect that while no period of limitation is fixed but in the normal course of events, the period, the party is required for filing a civil proceeding ought to be the guiding factor. While it is true that this extraordinary jurisdiction is available to mitigate the sufferings of the people in general but it is not out of place to mention that this extraordinary jurisdiction, has been conferred on to the law courts under Article 226 of the Constitution on a very sound equitable principle, Hence, the equitable doctrine, namely, `delay defects equity' has its fullest application in the matter of grant of relief under Article 226 of the Constitution. The discretionary relief can be had provided one has not by his act or conduct given a go-bye to his rights. Equity favours a vigilant rather than an indolent litigant and this being the basic tenet of law, the question of grant of an order as has been passed in the matter as regards restoration of possession upon cancellation of the notification does not and cannot arise. as a matter of fact lost sight of the fact that since the year 1952, the land was specifically reserved for public purposes of school playground and roads in the development plan and may reason therefore, the notification to acquire the land has, therefore, been issued under the provisions of the Act as stated above. ", "Apart from the time element as noticed above another redeeming feature on the factual aspect of the matter has not been considered by at all. There are three owners of the land, namely, , and . The first of the two owners amongst the three named above of the land did in fact put forward a claim in regard to the land value and structure before the concerned authority and two owners claimed as below :- ", "(i) Market Value of Rs. 20 per Sq. ft (ii) Value of Tin shed : Rs. 15,000 (iii) Build up structure : Rs. 30,000 ", "(iv) Damages and severance of the property :, Rs. 35,000 ", "(v) Salatium : 15% of the amount of compensation ", "(vi) Compensation for loss of; Rs. 13,000 compensation of the strip of land along towards in North side of the land under acquisition ", "(vii) For losing frontage and benefits : Rs. 50,000 acquiring therein ", "(viii) Cost of the house acquired : Rs. 40,000 for the right The other owner , however, did not put forth any claim for any specific amount but claimed only the market value of the land together with 15 per cent solatium and the cost of the building now standing on the land. Incidentally, the other owner is a resident of England and executed a power of attorney in favour of to act on his behalf in the proceeding before the authorities and to receive the amount of compensation. The power of attorney stands recorded in England in February, 1973. While it is true that the evidence rendered by the respondents during the course of hearing was without prejudice qua the reservation of rights to challenge the same but the factual backdrop in its entirety however in our view does not indicate any challenge to the notice of acquisition. ", "In any event; after the award is passed no writ petition can be filed challenging the acquisition notice or against any proceeding thereunder. This has been the consistent view taken by this Court and in one of recent cases ( , reported in 2 SCC 627. This court observed as below :- ", "\"The admitted position is that pursuant to the notification published under Section 4(1) of the Land Acquisition Act, 1894 (for short \"the Act\") in GOR No. 1392 Industries dated 17.10.1962, total extent of 6 areas 41 cents of land in Madhavaram Village, Saidapet Taluk, Chengalpattu District in Tamil Nadu was acquired under Chapter VII of the Act for the manufacture of Synthetic Rasiua by , Madras. The acquisition proceedings had become final and possession of the land was taken on 10.4.1964. Pursuant to the agreement executed by the company, it was handed over to which is a subsidiary of , It would appear that at a request made by the said company, 66 cents of land out of one acre 37 cents in respect of which the appellants originally had ownership, was transferred in GOMs No. 816. Industries dated 24.3.1971 in favour of another subsidiary company, , the 5th respondent Which is also another subsidiary of the company had requested for two acres 75 cents of land; the same came to be assigned on leasehold basis by the after resumption in terms of the agreement in dated 10.5.1985. In dated 30.3.86, the same came to be approved of. Then the appellants challenged the original dated 17.10.62 contending that since the Original purpose for which the land was acquired had ceased to be in operation, the appellants are entitled to restitution of the possession taken from them. The learned Single Judge and have held that the acquired land having already vested in the , after receipt of compensation by the predecessor-in-title of the appellants, they have no right to challenge the notification. Thus the writ petition and the writ appeal came to be dismissed.\" ", "Similar is the view in an earlier decision of this Court in the case of , reported in 11 SCC 501. Incidentally, the decision last noted was also on the land acquisition and requisition under the Maharashtra Regional and Town Planning Act, 1966 and in paragraph 29 of the report, this Court observed :- ", "It is well settled law mat when there is inordinate delay in filing me writ petition and when all steps token in the acquisition proceedings have become final, the should be loath to quash the notifications. has, no doubt, discretionary powers under Article 226 of the Constitution to quash the notification under Section 4 (1} and declaration under Section 6 . But it should be exercised taking all relevant factors into pragmatic consideration. When the award was passed and possession was taken, the should not have exercised its power to quash the award which is a material factor to be taken into consideration before exercising the power under Article 226. The fact that no third party rights were created in the case is hardly ground for interference. of the High was not right in interfering with the discretion exercised by the learned Single Judge dismissing the writ petition on the grounds of laches.\" ", "Mr. , learned senior counsel appearing for one of the respondents, placed strong reliance upon a recent decision of this Court in the case of arid , reported in 4 SCC 450. This Court in paragrpah 8 of the report observed as below :- ", "\"Sofar as the contention regarding laches of the respondent in filing the writ petition is concerned, delay, by itself, may not defeat the claim for relief unless the position of the appellant had been so altered which cannot be retracted on account of lapse of time or inaction of the other party. This aspect being dependent upon the examination of the facts of the case and such a contention not having been raised before `, it would not be appropriate to allow the appellants to raise such a contention for the first time before us. (Emphasis supplied) Besides, we may notice that the period for which the option of renewal has been exercised has not come to an end. During the subsistence of such a period certainly the respondent could make a complaint that such exercise of option was not available to the appellants and, therefore, the jurisdiction of could be invoked even at a later stage. Further, the appellants are not put to undue hardship in any manner by reason of this delay in approaching for a relief.\" ", "The observations however pertain to the Transfer of Property Act and in particular reference to Section 105 and the facts therein are clearly distinguishable and the sentence emphasised as above depicts the disgust feature. case (supra) is not a case for acquisition at all and reliance thereon thus is totally misplaced. ", "On the wake of the aforesaid, we do feel it expedient to record that has dealt with the matter on a totally different perspective and as such clearly fell into an error in passing the order as impugned in this appeal. Not only the length of time but the concept of approbation and reprobation has totally been ignored at stage. The appeal therefore, succeeds. The Writ Petition filed by the respondents in is dismissed and as such the I.A. No. 1/99 filed in SLP No. 19507 of 1998 also stands dismissed. In view of he dismissal of the writ petition by the present judgment, direction contained in the civil revision permitting the respondents to withdraw the compensation amount will obviously now be complied with. Each party however should pay and hear its own costs."], "relevant_candidates": ["0000081544", "0000701162", "0001381780", "0001433365"]} {"id": "0000702145", "text": ["REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO.3604 OF 2011 (Arising out of Special Leave Petition (C) No.30293 of 2010) , Banda ......Appellant Versus Moti Lal Agarwal and others ......Respondents J U D G M E N T ", ", J. ", "1. Leave granted. ", "2. The question which arises for consideration in this appeal is whether of was justified in entertaining and allowing the writ petition filed by respondent No.1-Moti Lal Agarwal in 2008 for nullifying the acquisition of his land by vide notification dated 8.9.1998 issued under Section 4(1) read with Section 17(1) and 17(4) of the Land Acquisition Act, 1894 (for short, \"the Act\") which was followed by declaration dated 7.9.1999 issued under Section 6(1) read with Section 17(1) on the ground of non passing of award within the time prescribed under Section 11A . ", "3. By the notifications referred in the preceding paragraph, acquired 103 bighas land situated in Ladakapurwa and Bhawanipur villages, Pargana and District Banda for of (for short, \"the \"). Both the notifications were published in the manner prescribed under Sections 4(1) and 6(2) respectively. ", "4. On 5.6.2000, the Secretary of the deposited Rs.63,47,855.07 towards 80% of the compensation payable in lieu of the acquisition of 103 bighas land. This was in compliance of the mandate of Section 17(3A) . The concerned authorities of the delivered possession of the acquired land to the on 30.6.2001. The officers of visited the site on 4.9.2001 and prepared the Field Book, copy of which has been produced before this Court along with affidavit dated 19.1.2011 of , Executive Engineer, . The Special Land Acquisition Officer passed award dated 14.6.2002 for the acquired land including plot No.795 of which 5 bighas 5 biswas was purchased by respondent No.1 vide registered sale deed dated 4.10.1982. ", "3 ", "5. In the meanwhile, the prepared lay out for the acquired land which was sanctioned by its Board on 8.5.2002. Thereafter, the land was developed in a phased manner and plots were carved out for economically weaker sections and LIG, MIG and HIG categories. The also constructed flats for economically weaker sections and those belonging to lower income group. The plots and flats were allotted to the eligible persons who had applied in response to different advertisements issued by the between 2.11.2002 and 26.4.2006. ", "6. After more than three years of publication of the declaration issued under Section 6(1) , respondent No.1 filed suit being O.S. No.52 of 2003 in (), , and prayed that the defendants be directed to start the acquisition proceedings afresh and disburse compensation after sub-dividing and numbering plot No.795 in accordance with paragraph 63 of the Land Record Manual. The suit was dismissed on 1.9.2007 in view of the bar contained in the Uttar Pradesh Zamindari Abolition and Land Reforms Act and the Land Acquisition Act . ", "Respondent No.1 challenged the order of in First Appeal No.364 of 2007 but withdrew the same by stating that the writ petition filed by him was pending. ", "4 ", "7. In the writ petition filed by him on 24.3.2008, respondent No.1 challenged notifications dated 8.9.1998 and 7.9.1999 mainly on the ground that the acquisition proceedings will be deemed to have lapsed because the award was not passed within two years from the date of last publication of the declaration issued under Section 6(1) . Respondent No.1 pleaded that though plot No.795 had not been sub-divided and demarcated and physical possession thereof was not taken, the concerned authorities prepared Kabja Hastantaran Praman Patra dated 30.6.2001 and thereby took paper possession of his land. He also claimed that plot No. 795/3 owned by him had not been notified, but the concerned authorities colluded with Smt. and other interested persons and reflected him as tenure holder of that plot. ", "8. The thrust of the affidavits filed by , Executive Engineer and , Assistant Engineer on behalf of the was that after taking possession of the acquired land, the constructed roads and nalis, laid pipelines for supply of water and also erected poles for electric lines and plots carved out from the acquired land were allotted to people belonging to different categories. In paragraphs 2, 3 and 4 of his affidavit, , Assistant Engineer, averred as under: ", "\"2. That present supplementary counter affidavit has been necessitated as the petitioner through rejoinder affidavit to the counter affidavit filed on behalf of respondents no.1, 2 and 3 has brought on record the copies of for the year 1407- 1411 fasli. ", " ", "3. That 1407 fasli is from 1st July, 1999 to 30th June, 2000 to 30th June, 2001. Similarly 1409 fasli is for the year 2001-02, 1410 fasli is for the year 2002-03, 1411 & 1412 fasli is for the year 2003-04 and 2004-05. ", " ", "4. The perusal of these Khasras shows that there is no entry of sowing any crop in 1410-1412 fasli, namely no crop was shown and they were, admittedly, not in possession from July, 2002 towards. Possession has been taken from petitioner on 30.6.2001. 30.6.2001 corresponds to end of 1408 fasli. It is thus clear that petitioner was not in possession after 30.6.2001. Entry of sowing any crop in Khasra 1409 is patently erroneous since in 1409 fasli i.e. from 1st July, 2001 petitioner was not in possession. This entry is incorrect and no crop has been sown after possession was taken on 30.6.2001.\" ", "9. In a separate affidavit, , Tehsildar (J), , supported the stand taken by the . He categorically averred that possession of the acquired land was handed over to on 30.6.2001 for the purpose of implementation of the residential scheme. Along with his affidavit, annexed photostat copy of report dated 14.7.2001 prepared by , , who had visited the spot and inspected the site. ", "6 ", "10. Although, respondent No.1 did not question the acquisition proceedings on the ground of non compliance of Section 7 of the Act, the Division Bench of suo moto observed that the acquisition proceedings can be quashed on the ground of non compliance of that section. then referred to the entries made in the revenue records and held that the acquisition proceedings will be deemed to have lapsed because neither physical possession of the land was taken nor the award was passed within two years as per the mandate of Section 11A . distinguished the judgment of this Court in . by observing that physical possession of the acquired land had not been taken for more than two years after publication of the declaration issued under Section 6(1) . ", "11. , learned senior counsel for the appellant argued that was not at all justified in entertaining and allowing the writ petition filed after nine years of publication of the declaration issued under Section 6(1) and six years of the passing of award by the Special Land Acquisition Officer and that too by ignoring that during the intervening period the carried out development, carved out plots and allotted the same to the eligible applicants including the members of economically weaker sections and also constructed flats for the economically weaker sections and lower income groups. submitted that respondent No.1 cannot justify belated filing of the writ petition on the ground that he was prosecuting the case in the civil Court because in the suit he had not prayed for quashing the notifications issued under Sections 4(1) and 6(1) . ", "Learned senior counsel relied upon the judgments of this Court in . (supra), , , , and argued that Section 11A is not applicable to the cases in which the land is acquired by invoking the emergency provisions contained in Section 17(1) and 17(4) . ", "He submitted that committed serious error by quashing the acquisition proceedings on the premise that physical possession of the acquired land had not been taken on 30.6.2001 Learned counsel referred to letter dated 5.6.2000 vide which the deposited a sum of Rs.63,47,855.07 towards the compensation payable to the land owners and submitted that the exercise undertaken for taking possession of the acquired land by the concerned authorities of the and delivery thereof to the could not have been brushed aside by by describing it as symbolic/paper possession. ", "8 ", "12. , learned senior counsel appearing for respondent No.1 supported the order under challenge and argued that rightly annulled the acquisition proceedings because physical possession of the land was taken only on 30.7.2002 and the award was passed after more than two years of publication of the declaration issued under Section 6(1) . ", "Learned senior counsel relied upon Khasra Land Records of Fasli years 1407, 1408 and 1409, which have been filed with I.A. No.3 of 2011 to show that physical possession of the acquired land continued with respondent No.1 till July 2002 and argued that the document prepared by the State authorities showing delivery of possession to the BDA cannot be made basis for recording a finding that physical possession of the acquired land was taken on 30.6.2001. Learned senior counsel relied upon the judgments of this Court in . , as also the judgments of in . (2008) 2 AWC 1832 and . (1999) 1 AWC 764 and submitted that symbolic/paper possession taken by the State authorities on 30.6.2001 was not sufficient for relieving of the obligation to pass award within two years of the last publication of the declaration issued under Section 6(1) . Shri then referred to the judgments of this Court in and and argued that respondent No.1 should not be non-suited on the ground of delay because no such objection was raised before . ", "13. We have considered the respective submissions. In the suit filed by him, respondent No.1 had unequivocally declared that he did not have any objection to the acquisition of land or the plots which were subject matter of the acquisition. The only grievance made by respondent No.1 was that the notification had been issued without sub-dividing plot No. 795. He also claimed that defendant No.3 had delivered possession to defendant No.4 on papers and they were trying to start construction after taking possession of his land. This is evident from paragraphs 5, 6, 8, 10 and 11 of the plaint, which are extracted below: ", "\"5. That description of the disputed plot which has acquired by the Gazette Notification is given as plot no.795 Rakba 12 Bigha and 795/2 Rakba 5 Bigha 5 Biswa. At the time of acquisition proceedings this fact came to liaht that olot no. 795 has not been sub-divided. Without sub-division of the plot it was not possible to acquire and give its compensation. Defendant No. 3 called for a report from regarding plot no.795 on the basis of possession and sub-division. After due inspection on the spot sent its detailed report dated 30.3.2001 to the defendant no. 3 stating clearly the sub-divided shares as follows:- ", "Sr. No. Plot no. Rakba Farmer Name 1. 795/1 06-16-10 , and 2. 795/2 09-08-05 Smt. Shashi Devi 3. 795/3 05-05-00 4. 795/4 04-03-05 5. 795/5 12-00-00 , and ", "6. That according to Land Record Manual the provision to enter numbers in an account is to start numbering vis 1,2,3,4 from north-west to south east. In accordance to this provision only the above said sub-division was done which is also lawful. The plaintiff has no objection with the sub-division. ", " ", "8. That it is important to clarify here that the plaintiff does not have any objection to the acquisition proceedings or the plot no.s which are subject to the acquisition. The plaintiff only states that acquisition be done only after sub-division of 795 according to the rules. The proceedings were initiated on the basis of the report of dated 30.3.2001 and the compensation for 795/2 was prepared in the name of and she was only shown as the Kastkaar in the said land and accordingly Akar part 11 was prepared and the notice under Section 14 was given to . After wards at any subsequent stage records were manipulated and the plaintiff was shown as the Kastkaar of 795/2. The plaintiff had filed several objections, personally met with the officials of the defendants and given applications. ", "Inspite of some decisions of inquiries in favour of the plaintiff has not been given any relief and due to the fact that defendant no.3 has delivered possession to defendant no. 4 on papers, the defendants are trying to start construction after taking possession of the land of the plaintiff and are shying away from their legal duty. ", "11 ", "10. That in the interest of justice it is necessary that the defendants be ordered that the acquisition and disbursement of compensation be done only after due inspection of plot no.795 and thereafter numbering it in accordance with law on the basis of possession. Because the defendants are not paying any heed to the justified claim of the plaintiff so this suit is being filed. ", "11. That the defendants are going to start construction on the site very soon and they have demarcated the land by embedding stones from which it is clear that they are going to possess the disputed land. In all these circumstances the notice u/s 80 CPC cannot be served upon the defendants and with the permission of , this suit is being filed without the notice.\" ", "(underlining is ours) The main and substantive prayer made in the plaint, which is extracted below, also shows that respondent No.1 had not questioned the acquisition proceedings: ", "\"That the defendants be directed by order of Mandatory Injunction to start afresh the proceedings of acquisition and disbursement of compensation after sub-dividing and numbering plot no. 795 in accordance with para no. 63 of the Land Record Manual. In the alternative acquire the land from all the account holders and thereby proportionally pay them respective compensation.\" ", "14. The above extracted portions of the plaint unmistakably show that respondent No.1 had no complaint against the acquisition of land or taking of possession by and delivery thereof to the and the only prayer made by him was that the defendants be directed to undertake fresh acquisition proceedings after sub-dividing plot No. 795 so that he may get his share of compensation. He filed writ petition questioning the acquisition proceedings after almost 9 years of publication of the declaration issued under Section 6(1) and about six years of the pronouncement of award by the Special Land Acquisition Officer. During this interregnum, the took possession of the acquired land after depositing 80% of the compensation in terms of Section 17(3A) , prepared the layout, developed the acquired land, carved out plots, constructed flats for economically weaker sections of the society, invited applications and allotted plots and flats to the eligible persons belonging to economically weaker sections as also LIG, MIG and HIG categories. Unfortunately, ignored all this and allowed the writ petition on the specious ground that the acquired land did not vest in because physical possession of the land belonging to respondent No.1 was not taken till 31.7.2002 and the award was not passed within two years as per the mandate of Section 11A . ", "15. In our view, even if the objection of delay and laches had not been raised in the affidavits filed on behalf of the and , was duty bound to take cognizance of the long time gap of 9 years between the issue of declaration under Section 6(1) and filing of the writ petition and declined relief to respondent No.1 on the ground that he was guilty of laches because the acquired land had been utilized for implementing the residential scheme and third party rights had been created. ", "The unexplained delay of about six years between the passing of award and filing of writ petition was also sufficient for refusing to entertain the prayer made in the writ petition. ", "16. It is true that no limitation has been prescribed for filing a petition under Article 226 of the Constitution but one of the several rules of self imposed restraint evolved by the superior courts is that will not entertain petitions filed after long lapse of time because that may adversely affect the settled/crystallized rights of the parties. If the writ petition is filed beyond the period of limitation prescribed for filing a civil suit for similar cause, will treat the delay unreasonable and decline to entertain the grievance of the petitioner on merits. AIR 1964 SC 1006, considered the effect of delay in filing writ petition under Article 226 of the Constitution and held: ", "14 ", "\"............It has been made clear more than once that the power to give relief under Article 226 is a discretionary power. This is specially true in the case of power to issue writs in the nature of mandamus. Among the several matters which rightly take into consideration in the exercise of that discretion is the delay made by the aggrieved party in seeking this special remedy and what excuse there is for it..................... .........It is not easy nor is it desirable to lay down any Rule for universal application. It may however be stated as a general Rule that if there has been unreasonable delay the court ought not ordinarily to lend its aid to a party by this extraordinary remedy of mandamus. ...........................Learned counsel is right in his submission that the provisions of the Limitation Act do not as such apply to the granting of relief under Art 226. It appears to us however that the maximum period fixed by the legislature as the time within which the relief by a suit in must be brought may ordinarily be taken to be a reasonable standard by which delay in seeking remedy under Article 226 can be measured. The court may consider the delay unreasonable even if it is less than the period of limitation prescribed for a civil action for the remedy but where the delay is more than this period, it will almost always be proper for the court to hold that it is unreasonable.\" ", " ", "17. In matters involving challenge to the acquisition of land for public purpose, this Court has consistently held that delay in filing the writ petition should be viewed seriously and relief denied to the petitioner if he fails to offer plausible explanation for the delay. The Court has also held that the delay of even few years would be fatal to the cause of the petitioner, if the acquired land has been partly or wholly utilised for the public purpose. ", "15 ", "18. , this Court approved dismissal by of the writ petition filed by the appellant for quashing the acquisition of his land and observed: ", "\" held that the appellants were guilty of delay and laches. relied on two important facts. First, that there was delivery of possession. The appellants alleged that it was a paper transaction. rightly rejected that contention. Secondly, said that the invested several lakhs of rupees for the construction of roads and material for development purposes. The appellants were in full knowledge of the same. The appellants did not take any steps. rightly said that to allow this type of challenge to an acquisition of large block of land piecemeal by the owners of some of the plots in succession would not be proper. If this type of challenge is encouraged the various owners of small plots will come up with writ petitions and hold up the acquisition proceedings for more than a generation. rightly exercised discretion against the appellants. We do not see any reason to take a contrary view to the discretion exercised by .\" ", "(emphasis supplied) ", "19. , this Court referred to Administrative Law H.W.R. Wade (7th Ed.) at pages 342-43 and observed: ", " ", "\"The order or action, if ultra vires the power, becomes void and it does not confer any right. But the action need not necessarily be set at naught in all events. Though the order may be void, if the party does not approach the within reasonable time, which is always a question of fact and have the order invalidated or acquiesced or waived, the discretion of the has to be exercised in a reasonable manner. When the discretion has been conferred on the , the may in appropriate case decline to grant the relief, even if it holds that the order was void. The net result is that extraordinary jurisdiction of the may not be exercised in such circumstances........\" ", "20. , the delay of 17 months was considered as a good ground for declining relief to the petitioner. ", " ", "21. . , this Court held: ", "\"It is thus well-settled law that when there is inordinate delay in filing the writ petition and when all steps taken in the acquisition proceedings have become final, the Court should be loath to quash the notifications. has, no doubt, discretionary powers under Article 226 of the Constitution to quash the notification under Section 4(1) and declaration under Section 6 . But it should be exercised taking all relevant factors into pragmatic consideration. When the award was passed and possession was taken, the Court should not have exercised its power to quash the award which is a material factor to be taken into consideration before exercising the power under Article 226. The fact that no third party rights were created in the case is hardly a ground for interference. of was not right in interfering with the discretion exercised by the learned Single Judge dismissing the writ petition on the ground of laches.\" ", "22. , this Court reversed the order of and held that the writ petition filed for quashing of acquisition of land for a residential scheme framed by the appellant- was liable to be dismissed on the ground that the same was filed after two years. ", "23. , the delay of 5 years was considered unreasonable and the order passed by refusing to entertain the writ petition was confirmed. In that case also the petitioner had initially filed suit challenging the acquisition of land. The suit was dismissed in 2001. Thereafter, the writ petition was filed. This Court referred to an earlier judgment in and observed: ", "\" this Court had observed that civil suit was not maintainable and the remedy to question notification under Section 4 and the declaration under Section 6 of the Act was by filing a writ petition. Even thereafter the appellant, as noted above, pursued the suit in the civil court. The stand that five years after the filing of the suit, the decision was rendered does not in any way help the appellant. Even after the decision of this Court, the appellant continued to prosecute the suit till 2001, when the decision of this Court in 1995 had held that suit was not maintainable.\" ", "24. , the dismissal of writ petition filed after seven years of the publication of declaration and five years of the award passed by the Collector was upheld by the Court and it was observed: ", "\"In the instant case, it is not the case of the petitioners that they had not been aware of the acquisition proceedings as the only ground taken in the writ petition has been that substance of the notification under Section 4 and declaration under Section 6 of the 1894 Act had been published in the newspapers having no wide circulation. Even if the submission made by the petitioners is accepted, it cannot be presumed that they could not be aware of the acquisition proceedings for the reason that a very huge chunk of land belonging to a large number of tenure-holders had been notified for acquisition. Therefore, it should have been the talk of the town. Thus, it cannot be presumed that the petitioners could not have knowledge of the acquisition proceedings.\" ", " ", "25. In this case, the acquired land was utilized for implementing Tulsi Nagar Residential Scheme inasmuch as after carrying out necessary development i.e. construction of roads, laying electricity, water and sewer lines etc. the carved out plots, constructed flats for economically weaker sections and lower income group, invited applications for allotment of the plots and flats from general as well as reserved categories and allotted the same to eligible persons. In the process, the not only incurred huge expenditure but also created third party rights. In this scenario, the delay of nine years from the date of publication of the declaration issued under Section 6(1) and almost six years from the date of passing of award should have been treated by as more than sufficient for denying equitable relief to respondent No.1. ", "26. The two judgments relied upon by the learned counsel for respondent No.1 are not helpful to the cause of his client. In v. V. (2007) 9 SCC 304, this Court held that where the acquisition was found to be vitiated by fraud and mala fide, the delay in filing the writ petition cannot be made a ground for denying relief to the affected person. (supra), this Court held that the appellant cannot be denied relief merely because there was some delay in filing the writ petition. The facts of that case were that 34 kanals 2 marlas of land situated at Jind (Haryana) was acquired by under Section 4 read with Section 17(2)(c) and 17(4) for construction of sewage treatment plant. Notification under Section 4 was issued on 23.11.2005 and declaration under Section 6 was issued on 2.1.2006. , Narwana, filed suit for injuncting the from constructing sewage treatment plant in front of the school. On 15.2.2006, passed an order of injunction. In another suit filed by one similar order was passed by . After some time, the appellant filed writ petition under Article 226 of the Constitution. ", "Before this Court it was argued that relief should be denied to the appellant because there was delay in filing the writ petition. Rejecting this argument, the Court observed: ", "\"Since Section 5-A of the LA Act had been dispensed with, the stage under Section 9 was arrived at within six months from the date of the notice issued under Sections 4 and 17(2)(c) of the LA Act. While such notice was issued on 23-11-2005, the award under Section 11 was made on 23-5-2006. During this period, the appellants filed a suit and thereafter, withdrew the same and filed a writ petition in an attempt to protect their constitutional right to the property. It cannot, therefore, be said that there was either any negligence or lapse or delay on the part of the appellants.\" ", " ", "27. De hors the aforesaid conclusion, we are convinced that the premise on which declared that the acquisition proceedings will be deemed to have lapsed because the award was not passed within two years is ex facie erroneous. Admittedly, the State Government had acquired the land by issuing notification under Section 4 read with Section 17(1) and (4), which was followed by a declaration issued under Section 6(1) read with Section 17(1) . By notification dated 7.9.1999, the Governor had directed Collector, to take possession of the acquired land on the expiration of 15 days from the issue of notice under Section 9(1) . In furtherance of the direction given by the Collector, the concerned revenue authorities took possession of the acquired land, which, as mentioned above, has already been utilized for implementing Tulsi Nagar Residential Scheme. Though, respondent No.1 succeeded in convincing that physical possession of his land had not been taken till 31.7.2002, after carefully perusing the record, we are convinced that the finding recorded on this issue is unsustainable. In paragraphs 8 and 11 of the plaint filed by him in (), , respondent No.1 had virtually admitted that possession of the acquired land was with the . If this was not so, there was no occasion for him to make a grievance that the land had been demarcated by putting stones and the was in the process of raising construction. That apart, respondent No. 1 did not deny the statements contained in the affidavits filed before that the revenue authorities visited the spot and made entries in the Field Book regarding delivery of possession. The photographs produced by the parties before this Court show that after taking possession of the acquired land, the constructed roads,buildings etc., laid sewer lines and erected poles for electric lines. The photographs also reveal that by taking advantage of the impugned order, respondent No.1 took possession of a portion of the land on which the had already carried out development. All this is sufficient to discard the claim of respondent No.1 that actual possession of the acquired land had not been delivered to the till July, 2002. ", "28. What should be the mode of taking possession of the land acquired under the Act? This question was considered in . , referred to the provisions contained in Order XXI Rules 35, 36, 95 and 96 of the Code of Civil Procedure, decisions of different and opined that even the delivery of so called \"symbolical\" possession is delivery of \"actual\" ", "possession of the right, title and interest of the judgment-debtor. , ", "further observed that if the property is land over which there is no building or structure, then delivery of possession over the judgment-debtor's property becomes complete and effective against him the moment the delivery is effected by going upon the land. The Learned Judge went on to say: ", "\"When a public notice is published at a convenient place or near the land to be taken stating that the intends to take possession of the land, then ordinarily and generally there should be no question of resisting or impeding the taking of possession. Delivery or giving of possession by the owner or the occupant of the land is not required. The Collector can enforce the surrender of the land to himself under Section 47 of the Act if impeded in taking possession. On publication of the notice under Section 9(1) claims to compensation for all interests in the land has to be made; be it the interest of the owner or of a person entitled to the occupation of the land. On the taking of possession of the land under Section 16 or 17 (1) it vests absolutely in the free from all incumbrances. It is, therefore, clear that taking of possession within the meaning of Section 16 or 17 (1) means taking of possession on the spot. It is neither a possession on paper nor a \"symbolical\" possession as generally understood in civil law. But the question is what is the mode of taking possession? The Act is silent on the point. Unless possession is taken by the written agreement of the party concerned the mode of taking possession obviously would be for the authority to go upon the land and to do some act which would indicate that the authority has taken possession of the land. It may be in the form of a declaration by beat of drum or otherwise or by hanging a written declaration on the spot that the authority has taken possession of the land. The presence of the owner or the occupant of the land to effectuate the taking of possession is not necessary. No further notice beyond that under Section 9(1) of the Act is required. When possession has been taken, the owner or the occupant of the land is dispossessed. Once possession has been taken the land vests in the . ", "(emphasis supplied) , (as he then was), speaking for himself and , disagreed with , and observed: ", "\".........We think it is enough to state that when the proceeds to take possession of the land acquired by it under the Land Acquisition Act , 1894, it must take actual possession of the land, since all interests in the land are sought to be acquired by it. There can be no question of taking \"symbolical\" possession in the sense understood by judicial decisions under the Code of Civil Procedure. Nor would possession merely on paper be enough. What the Act contemplates as a necessary condition of vesting of the land in the is the taking of actual possession of the land. How such possession may be taken would depend on the nature of the land. Such possession would have to be taken as the nature of the land admits of. There can be no hard and fast rule laying down what act would be sufficient to constitute taking of possession of land. We should not, therefore, be taken as laying down an absolute and inviolable rule that merely going on the spot and making a declaration by beat of drum or otherwise would be sufficient to constitute taking of possession of land in every case. But here, in our opinion, since the land was lying fallow and there was no crop on it at the material time, the act of the Tehsildar in going on the spot and inspecting the land for the purpose of determining what part was waste and arable and should, therefore, be taken possession of and determining its extent, was sufficient to constitute taking of possession. It appears that the appellant was not present when this was done by the Tehsildar, but the presence of the owner or the occupant of the land is not necessary to effectuate the taking of possession. It is also not strictly necessary as a matter of legal requirement that notice should be given to the owner or the occupant of the land that possession would be taken at a particular time, though it may be desirable where possible, to give such notice before possession is taken by the authorities, as that would eliminate the possibility of any fraudulent or collusive transaction of taking of mere paper possession, without the occupant or the owner ever coming to know of it.\" ", "(emphasis supplied) ", "29. , the Court negatived the argument that even after finalization of the acquisition proceedings possession of the land continued with the appellant and observed: ", " ", "\"It is seen that the entire gamut of the acquisition proceedings stood completed by 17-4-1976 by which date possession of the land had been taken. No doubt, has contended that the appellant still retained their possession. It is now well-settled legal position that it is difficult to take physical possession of the land under compulsory acquisition. The normal mode of taking possession is drafting the panchnama in the presence of panchas and taking possession and giving delivery to the beneficiaries is the accepted mode of taking possession of the land. Subsequent thereto, the retention of possession would tantamount only to illegal or unlawful possession\". ", "30. , the Court referred to the observations made by , J. in (supra) that no hard and fast rule can be laid down as to what act would be sufficient to constitute taking of possession of the acquired land and observed that when there is no crop or structure on the land only symbolic possession could be taken. ", "31. , the Court noted that appellant paid 80 per cent of the total compensation in terms of Section 17(3A) and observed that it is difficult to comprehend that after depositing that much of amount it had obtained possession only on a small fraction of land. ", "32. and , it was held that when possession is to be taken of a large tract of land then it is permissible to take possession by a properly executed panchnama. Similar view was expressed in the recent judgment in 2011(2) SCALE 692. ", "33. The judgment in . (supra) on which reliance was placed by the learned senior counsel for respondent No.1 is clearly distinguishable. In that case, the had found that possession of the acquired land had not been taken by the and the award was not passed even after two years from the date of coming into force of the Land Acquisition (Amendment) Act , 1984 whereby Section 11A was inserted in the Act. ", "34. The principles which can be culled out from the above noted judgments are: ", "i) No hard and fast rule can be laid down as to what act would constitute taking of possession of the acquired land. ", "ii) If the acquired land is vacant, the act of the concerned State authority to go to the spot and prepare a panchnama will ordinarily be treated as sufficient to constitute taking of possession. ", "iii) If crop is standing on the acquired land or building/structure exists, mere going on the spot by the concerned authority will, by itself, be not sufficient for taking possession. Ordinarily, in such cases, the concerned authority will have to give notice to the occupier of the building/structure or the person who has cultivated the land and take possession in the presence of independent witnesses and get their signatures on the panchnama. Of course, refusal of the owner of the land or building/structure may not lead to an inference that the possession of the acquired land has not been taken. ", "iv) If the acquisition is of a large tract of land, it may not be possible for the acquiring/designated authority to take physical possession of each and every parcel of the land and it will be sufficient that symbolic possession is taken by preparing appropriate document in the presence of independent witnesses and getting their signatures on such document. ", "v) If beneficiary of the acquisition is an agency/instrumentality of the and 80% of the total compensation is deposited in terms of Section 17(3A) and substantial portion of the acquired land has been utilised in furtherance of the particular public purpose, then the may reasonably presume that possession of the acquired land has been taken. ", "35. In the light of the above discussion, we hold that the action of the concerned State authorities to go to the spot and prepare panchnama showing delivery of possession was sufficient for recording a finding that actual possession of the entire acquired land had been taken and handed over to the . The utilization of the major portion of the acquired land for the public purpose for which it was acquired is clearly indicative of the fact that actual possession of the acquired land had been taken by the . ", "36. Once it is held that possession of the acquired land was handed over to the on 30.6.2001, the view taken by that the acquisition proceedings had lapsed due to non-compliance of Section 11A cannot be sustained. . (supra), this Court considered the applicability of Section 11A in cases involving acquisition of land under Section 4 read with Section 17 and observed: ", "\"Ordinarily, the can take possession of the land proposed to be acquired only after an award of compensation in respect thereof has been made under Section 11 . Upon the taking of possession the land vests in the , that is to say, the owner of the land loses to the the title to it. This is what Section 16 states. The provisions of Section 11-A are intended to benefit the landowner and ensure that the award is made within a period of two years from the date of the Section 6 declaration. In the ordinary case, therefore, when fails to make an award within two years of the declaration under Section 6 , the land has still not vested in the and its title remains with the owner, the acquisition proceedings are still pending and, by virtue of the provisions of Section 11-A , lapse. When Section 17(1) is applied by reason of urgency, takes possession of the land prior to the making of the award under Section 11 and thereupon the owner is divested of the title to the land which is vested in the . Section 17(1) states so in unmistakable terms. Clearly, Section 11-A can have no application to cases of acquisitions under Section 17 because the lands have already vested in the and there is no provision in the said Act by which land statutorily vested in the can revert to the owner.\" ", "(emphasis supplied) ", "37. The same view was reiterated in (supra), (supra), , (supra) and (supra). ", "38. In the result, the appeal is allowed. The impugned order is set aside and the writ petition filed by respondent No.1 is dismissed with cost quantified at Rs.1,00,000/-. Respondent No.1 shall deposit the amount of cost with the appellant within a period of two months from today. ", "...................... ", ".......J. ", "[G.S. Singhvi] ..............................J. ", "[] New Delhi April 26, 2011."], "relevant_candidates": ["0000022699", "0000081544", "0000134532", "0000162629", "0000186576", "0000226270", "0000320235", "0000351816", "0000544845", "0000608274", "0000768110", "0000896769", "0001013352", "0001022818", "0001055016", "0001199297", "0001204286", "0001365820", "0001407555", "0001458300", "0001530058", "0001537954", "0001541615", "0001642527", "0001653863", "0001921344", "0063447541"]} {"id": "0000729271", "text": ["JUDGMENT , J. ", "1. Any welfare legislation, when enforced strictly, is likely to cause some hardship to one person or the other having interest in the property sought to be subjected to the rigour of such legislation. The Urban Land (Ceiling & Regulation) Act , 1976 is one such welfare legislation and it is also included in the 9th Schedule of the Constitution of India. Section 20 of the Urban Land (Ceiling & Regulation) Act , 1976, hereinafter referred to as \"the Act\", however to some extent empowers to grant exemptions to alleviate such hardships. by G.O. Ms. No. 4778 Revenue (UCII) Department, dated 11-11-80, exercising its power under section 20(1) of the Act exempted an excess vacant land measuring 4776.84 Square mts. bearing premises No. 9-1-87 situated at St. John's Road, Secunderabad in Hyderabad urban agglomeration, held jointly by , , Smt. and Smt. . It is this G.O. that is challenged in both these writ petitions. , a tenant in the exempted premises and the adjacent land has filed Writ Petition No. 3568 of 1984 seeking a writ or directing declaring the impugned G.O. as void on the ground that the same has been obtained by fraud and misrepresentation and also on the ground that the Government has acted arbitrarily in granting exemption. Smt. who is one of the joint owners of the land has filed Writ Petition No. 5449 of 1985 questioning the same G.O. and in effect she is supporting the plea taken by and she is also respondent No. 7 in W.P. No. 3568 of 1984. For the sake of convenience the parties shall be referred as arrayed in W.P. No. 3568 of 84. ", "2. The case of the petitioner, viz., is as follows :- The petitioner-company was registered under the Indian Companies Act having its registered office at Calcutta and also having its business inter alia its Branch Office at No. 23, Sarojinidevi Road, Secunderabad. The company manufactures and sells electrical cables and also undertakes the contracts relating to the erection of electrical installation and equipments of Thermal Stations, etc. On 1-10-1958 one Sri father of respondents 4, 5 and 7 and husband of respondent No. 6, viz., Sri , Sri , Smt. Kanakam and Smt. , respectively, leased out the premises on a monthly rent of Rs. 400/- to the petitioner-company for housing its branch office and the residence of its Assistant Manager and his family. The total area of the tenanted premises including the main buildings, two out-houses, etc., and open space all around with a big compound wall was about 18,000 Sq. yards. The main building was used for the office of the company and the resident of the Assistant Manager and his family, and the out-houses and the open space are being used for storing cable drums and parking of the vehicle. At the request of Sri the petitioner-company released 2,000 sq. yards and later again it released 6020 sq. yards which was leased out to one for the construction of a cinema theatre, known as 'Sangeet'. After the construction of Sangeet theatre a new entrance was opened and different Municipal Nos. viz. 9-1-87 and 9-1-119-/1 were given to the tenanted premises. After the death of Sri the tenanted premises devolved upon respondents 4 to 7. On 30-4-1981 the petitioner-company received a letter from the 4th respondent informing that the entire premises was sold to the 8th respondent-firm and directing the petitioner to pay the future rents to the said 8th respondent-firm with effect from 1-5-1981. Since then the petitioner-company was paying rents to the 8th respondent which is a partnership-firm known as ' represented by its Managing Partner . The 8th respondent-firm sent a registered letter on 18-6-1981 calling upon the petitioner to vacate the premises and the petitioner-company sent a reply notice that the company is a statutory tenant and that the 8th respondent is not entitled to evict the petitioner-company. While so, on 11-6-1982, it is alleged that the 8th respondent with the active support of other partners and hired goondas and coolies, trespassed into the petitioner's premises, demolished the compound walls, wicket gate and fencing and closed the main gate highhandedly. They also constructed walls by dividing the entire vacant land and houses thereon into four plots. Thus they caused obstruction to the petitioner's vehicles and its employees. The petitioner filed R.C. No. 108 of 1982 before the Rent Controller, Secunderabad for restoration of amenities and for direction not to interfere with the possession and peaceful enjoyment of the tenanted premises by the petitioner-company and its employees. By an order dated 15-6-1982 the Rent Controller restored the amenities. Against the said order the 8th respondent filed R.A. No. 171 of 1982 before the Chief Judge, and sought interim orders suspending the order of restoration but the same was dismissed. As against that a Civil Revision Petition was filed in and it was also dismissed. R.C. No. 108 of 1982 is pending. The petitioner-company filed O.S. No. 640 of 1982 in , , Secunderabad, against the 8th respondent-firm for a permanent injunction, and pending the suit interim injunction was also granted. While matters stood thus, respondents 4 to 6 and 8 filed an eviction petition R. C. No. 141 of 1982 before the Rent Controller against the petitioner. In that petition they contended that they want the premises for bona fide requirement. In R.C. No. 141 of 1982 the 8th respondent filed a rejoinder on 29-10-1982 stating that (the 1st respondent) in G.O. Ms. No. 4778 Revenue, dated 11-11-1980 granted exemption in favour of the respondents Nos. 4 to 8 for the sale of the surplus vacant land by respondents 4 to 7 in favour of the 8th respondent and for the construction of the Nursing Home by the 8th respondent. In the rejoinder it is also stated that respondents 4 to 7 filed declarations and , (3rd respondent) sent up a report, and entertaining the application for exemption the exercising its powers under section 20(1)(a) and (b) of the Act granted permission for alienating the land in favour of the 8th respondents should construct a Nursing Home. The other respondents also filed similar rejoinders. The petitioner was not aware of any such exemption. However, after coming to know of the same from the rejoinders filed by the respondents, the petitioner has filed this writ petition. In the affidavit filed in support of the writ petition it is also further alleged that the respondents have obtained the exemption by making misrepresentation and playing fraud on the . It is also stated that on enquiry the petitioner came to know that Smt. A (6th respondent) by an agreement of sale dated 19-11-1974 sold her house bearing No. 6-1-125 with an open land in Padmarao Nagar, Secunderabad to Sri W.D. Francis the Managing Partner of the 8th respondent-firm, for a sum of Rs. 25,000/- and she received a cheque on 18-11-1974 for a sum of Rs. 10,000/- drawn on , Hyderabad, towards the sale consideration and a sale deed was executed and registered on 14-7-1975, that respondents 4 to 8 made misrepresentation to the by stating that they entered into an oral agreement on 18-11-1974 regarding the sale of the premises bearing No. 9-1-87 by respondents 4 to 7 in favour of the 8th respondent and that the respondents pressed into service the cheque dated 18-11-74 for a sum of Rs. 10,000/- paid to Smt. towards advance for the purchase of her house at Padmarao Nagar, for the purpose of the present transaction and made the believe that there is an oral agreement dated 18-11-1974. Accordingly they played fraud on the and other concerned authorities in making them believe that there was an agreement on 18-11-1974 and therefore the order itself is a nullity. ", "3. The 8th respondent is the main contesting party. In its counter-affidavit it is mainly stated that the petitioner has no locus standi to question the G.O. granting exemption and that even assuming that the petitioner is a tenant he is not entitled to hold the excess land. Coming to the allegation of fraud it is stated by the 8th respondent that the advance of Rs. 10,000/- by way of cheque dated 18-11-1974 towards the house property purchased at Padmaraonagar was not enchashed by the owners, viz., Smt. and others, that cash consideration was paid to them and that the owners have not disputed the cash consideration of Rs. 10,000/- and in fact they got the sale deed registered. When the owners themselves do not dispute about the receipt of the cash consideration, it is not open to the petitioner to question. It is also further alleged that there were two transactions between the 8th respondent and respondents 4 to 7 and it is open to them to adjust money from one transaction to the other and therefore the writ petition is liable to be dismissed. ", "4. The learned counsel for the petitioner submits that the petitioner has locus standi to question the G.O. inasmuch as he has an interest as a person holding the land and the petitioner being a company promoting industry can have a reasonable expectation of the same land being allotted to it by the at the stage of distribution of the excess. The further submission is that as the petitioner would be prejudicially affected inasmuch as it is thrown to the jeopardy of being evicted from the premises and that it also should have been heard by the before granting exemption, and that therefore there is violation of principles of natural justice. However, the main ground on which the G.O. is attacked is that of fraud and it is submitted that an order obtained by fraud is a nullity. ", "5. The learned counsel for the respondents on the other hand submits that the petitioner has no locus standi even to file a writ petition questioning the G.O. and therefore there is no question of giving any opportunity of being heard and there is no violation of principles of natural justice. So far as the allegation of fraud is concerned, the submission of the learned counsel for the respondents is that it is purely a question of fact and that if all the circumstances are examined and considered in a proper perspective it would manifest that there is a such misrepresentation or fraud committed by the respondent before the Government. ", "6. We shall first consider the question of locus standi both from the point of view of moving the and the right of being heard. ", "7. , AIR 1976 SC 578, is a case where the proprietor of a cinema theatre holding a licence for exhibiting cinematography films filed a writ petition questioning a no-objection certificate granted in favour of another rival in that trade. A preliminary objection was taken that he had no locus standi to file the writ petition because his rights in any manner were not affected by the granting of the no-objection certificate. Considering the same, held thus :- ", "\"According to most English decisions, in order to have the locus standi to invoke certiorari jurisdiction, the petitioner should be an \"aggrieved person\" and in a case of defect of jurisdiction, such a petitioner will be entitled to a writ of certiorari as a matter of course, but if he does not fulfil that character, and is a \"stranger\", the will, in its discretion, deny him this extraordinary remedy, save in very special circumstances. This takes us to the further question: who is an \"aggrieved person\"? And what are the qualifications requisite for such a status? The expression \"aggrieved person\" denotes an elastic, and, to an extent, an elusive concept. It cannot be confined within the bounds of a rigid, exact and comprehensive definition. At best, its features can be described in a broad tentative manner. Its scope and meaning depends on diverse, variable factors such as the content and intent of the statute of which contravention is alleged, the specific circumstances of the case, the nature and extent of the petitioner's interest, and the nature and extent of the prejudice or injury suffered by him.\" ", "It is further observed : ", "In other words, as a general rule, infringement of some legal right or prejudice to some legal interest inhering in the petitioner is necessary to give him a locus standi in the matter,\" ", "Their Lordships also suggested some broad tests which are to the following effect, viz., \"To distinguish such applicants from 'strangers', among them, some broad tests may be deduced from the conspectus made above. These tests are not absolute and ultimate. Their efficacy varies according to the circumstances of the case, including the statutory context in which the matter falls to be considered. These are : Whether the applicant is a person whose legal right has been infringed? Has he suffered a legal wrong or injury, in the sense, that his interest, recognised by law, has been prejudicially and directly affected by the act or omission of the authority, complained of? Is he a person who has suffered a legal grievance, a person \"against whom a decision has been pronounced which has wrongfully deprived him of something, or wrongfully refused him something or wrongfully affected his title to something? Has he a special and substantial grievance of his own beyond some grievance or inconvenience suffered by him in common with the rest of the public? Was he entitled to object and be heard by the authority before it took the impugned action? If so, was he prejudicially affected in the exercise of that right by the act of usurpation of jurisdiction on the part of the authority? Is the statute, in the context of which the scope of the words \"person aggrieved\" is being considered, a social welfare measure designed to lay down ethical or professional standards of conduct for the community? Or is it a statute dealing with private rights of particular individuals?\" Applying these tests, their Lordships dismissed the writ petition holding that the stand taken by the petitioners, viz., the cinema theatre owner that the setting up of a rival cinema house in the town will adversely affect his monopolistic commercial interest, cannot be countenanced, as granting such a licence is not wrongful inasmuch as it does not result in injury to a legal right or a legally protected interest, the business competition causing it being a lawful activity. ", "8. There is now a clear trend on the part of the enlarging the scope of rule of locus standi. In v. , their Lordships held that the workers of a company are entitled to appear at the hearing of the winding up petition whether to support or to oppose it so long as no winding up order is made by the and that the workers have a locus to appear and be heard in the winding up petition both before the winding up petition is admitted and an order for advertisement is made as also after the admission and advertisement of the winding up petition until an order is made for winding up the company. It is also observed that if a winding up order is made and the workers are aggrieved by it, they would also be entitled to prefer an appeal and contend in the appeal that no winding up order should have been made by the company Judge. , (what is known as Judges' transfer case), it was contended that the lawyers had no locus standi to file petitions questioning the Circular of the Law Minister. Their Lordships observed thus :- ", "\"The traditional rule in regard to locus standi is that judicial redress is available only to a person who has suffered a legal injury by reason of violation of his legal right or legally protected interest by the impugned action of the or a public authority or any other person or who is likely to suffer a legal injury by reason of threatened violation of his legal right or legally protected interest by any such action. The basis of entitlement to judicial redress is personal injury to property, body, mind or reputation arising from violation, actual or threatened, of the legal right or legally protected interest of the person seeking such redress. This is a rule of ancient vintage and it arose during an era when private law dominated the legal scene and public law had not yet been born.\" ", "Their Lordships, after examining some of the English cases, concluded,- ", "It may therefore now be taken as well established that where a legal wrong or a legal injury is caused to a person or to a determinate class of persons by reason of violation of any constitutional legal right or any burden is imposed in contravention of any constitutional or legal provision or without authority of law or any such legal wrong or legal injury or illegal burden is threatened and such person or determinate class of persons is by reason of poverty, helplessness or disability or socially or economically disadvantaged position, unable to approach the for relief, any member of the public can maintain an application for an appropriate direction, order or writ in the High under Art. 226 and in case of breach of any fundamental right of such person or determinate class of persons, in this under Art. 32 seeking judicial redress for the legal wrong or injury caused to such person or determinate class of persons. Where the weaker sections of the community are concerned, such as undertrial prisoners languishing in jails without a trial, inmates of in Agra or Harijan workers engaged in road construction in the Ajmer District, who are living in poverty and destitution who are barely eking out a miserable existence with their sweat and toil, who are helpless victims of an exploitative society and who do not have easy access to justice, this will not insist on a regular writ petition to be filed by the public spirited individual espousing their cause and seeking relief for them. This will readily respond even to a letter addressed by such individual acting pro bono publico. It is true that there are rules made by this prescribing the procedure for moving this for relief under Art. 32 and they require various formalities to be gone through by a person seeking to approach this . But it must not be forgotten that procedure is but a handmaiden of justice and the cause of justice can never be allowed to be thwarted by any procedural technicalities. The would therefore unhesitatingly and without the slightest qualms of conscience cast aside the technical rules of procedure in the exercise of its dispensing power and treat the letter of the public minded individual as a writ petition and act upon it.\" ", "9. Applying these principles to the facts in the instant case we find that though the petitioner's legal rights as such are not affected by the exemption order, yet it can maintain the writ petition as a person interested and does not come under the category of 'busy body'. Therefore, in view of the broad propositions of law regarding the rule of locus standi laid down by , we hold that the petitioner has locus standi to question the impugned G. O. by way of a writ petition. ", "10. The next question is whether the impugned G. O. should be struck down for violation of the principles of natural justice, on the ground that the petitioner is not heard by the before granting exemption. in several decisions, particularly in , , , , and , held that no order involving adverse civil consequences can be passed against any person without giving him an opportunity to be heard against the passing of such order and this rule applies irrespective whether the proceeding in which it is passed is a quasi-judicial or an administrative proceeding. In the instant case the exercising its powers under section 20 of the Act exempted the excess open land from the operation of the provisions of the Act. The limited exemption granted does not in any way impinge the rights of the petitioner who claims to be the tenant over the land. As already mentioned he has also filed a suit in in which he can urge all his rights and he can also raise all his defences in the rent control proceedings. A perusal of the G. O. itself shows that the excess vacant land is exempted from the provisions of the Act to enable the owners to complete the sale transaction as per the written agreement dated 13-5-1975 \"for the construction of , with 50 bedded hospital and allied complex, subject to the condition that the purchasers should utilise the said land only for the construction of the said hospital with allied complex and not for any other purpose.\" This exemption order does not automatically entitle any of the respondents to evict the petitioner. When an owner approaches the for exemption, the while exercising its powers under section 20 of the Act should not act arbitrarily, but act fairly keeping in view the object and intent of the Act. Whether the has acted in such a manner or not shall be considered at a later stage. So far as the petitioner's plea that it should have been heard at the time of granting of exemption, is concerned, the plea does not appeal to us inasmuch as the order does not involve adverse civil consequences so far as the petitioner is concerned. ", "11. The learned counsel submits that the petitioner is a tenant and he by virtue of this G. O. is thrown open to the jeopardy of eviction. But these questions are in any event have to be decided in . The petitioner cannot automatically be dispossessed just because an exemption order is passed. Whatever rights the petitioner enjoyed are not taken away by the exemption order. The relationship of tenant and landlord is not severed and put to an end by passing this G. O. ", "12. Further, there are certain other circumstances also which would show that the petitioner does not come under that category of persons who can be said to have suffered some civil consequences so as to hold that he is a really aggrieved person and therefore he must be heard by the Government. There are two pending proceedings in . O. S. No. 640 of 1982 is a suit filed by for an injunction restraining the 8th respondent herein from trespassing the suit premises and for a mandatory injunction for removing the construction already made. The arguments are also concluded and the judgment is awaited. R. C. 141 of 1982 is pending before . The question of bona fide requirement is also being considered. The record shows that the petitioner had full knowledge of the exemption by the date these proceedings are initiated. By a letter dated 30-4-1981 Smt. (6th respondent) has informed the petitioner-company that they had sold the entire premises admeasuring 7000 sq. yards to the 8th respondent by a registered sale deed dated 13-3-1981 and 24-4-1981. The petitioner was also informed to enter into direct negotiations with the 8th respondent and to pay future rents to them. It is specifically mentioned in the letter that the relationship of tenancy between the respondents Nos. 4 to 7 and the petitioner was terminated by virtue of the alienations made by respondents 4 to 7, and the petitioner was asked to have direct dealings with the 8th respondent, and by the said letter the tenancy relationship was also attorned in favour of the 8th respondent-firm. Again by a letter dated 8-4-1982 the 8th respondent informed the petitioner that they had purchased the land and the building after a great deal of hardship in obtaining exemption under the Act and that they have proposals to establish a nursing home and sought the co-operation of the petitioner. The present writ petition is filed in the year 1984 though the petitioner had full knowledge about the exemption even in the year 1982. It can, therefore, be seen that hitherto the petitioner did not, against these orders, have any grievance that there has been violation of the principles of natural justice. ", "13. Further for us, at least for the purpose of this writ petition, it appears that the excess vacant land is not part of the tenancy. In R. C. No. 141 of 1982 the plea of the petitioner is that it is not a tenant for the whole land. Even assuming that it is a tenant for the whole land, then as per the provisions of the Act it also should have filed a declaration. A copy of the declaration said to have been filed by the petitioner-company is placed before us. In the Annexure-A to the declaration the petitioner has filled up the columns. In Col. 7 under the head \"Class of land i.e., vacant lands/land with building agricultural land\" the entry reads \"land with building\". Then under Col. 9 \"How acquired\" it is noted \"By lease agreement, whereafter monthly tenant\". Under the head \"Remarks\" it is noted that \"since the property is on monthly tenancy as on 17-2-1976 and even on 17-2-1975, the Act does not apply\". From the entries made in the Annexure to the declaration it is clear that the petitioner did not claim that it is in possession of the excess vacant land also as tenant. The learned counsel for the petitioner however submits that the remark that the Act does not apply, is correct in view of the Explanation to Sec. 4 of the Act. We are unable to agree. The relevant part of the Explanation to Sec. 4 reads thus :- ", "\"For the purposes of this section and sections 6 , 8 and 18 a person shall be deemed to hold any land on which there is a building (whether or not with a dwelling unit therein) if he- ", "(i) owns such land or the building; or ", "(ii) owns such land but possesses the building or possesses such land and the building, the possession, in either case, being as a tenant under a lease, the unexpired period of which is not less than ten years at the commencement of this Act, or as a mortgagee or under an irrevocable power-of-attorney or a hire-purchase agreement or partly in one of the said capacities and partly in other of the said capacity or capacities; or ", "(iii) xxx xxx xxx xxx\" ", "A careful reading of this provision shows that a person shall be deemed to hold any land on which there is a building; and \"the land\" referred to in clause (ii) of the explanation applies to a land on which there is a building and the adjacent land. In State of U. P. v. , their Lordships while considering the scope of Sec. 4(9) of the Act observed :- ", "\"In fact Sec. 4(9) itself puts the matter beyond controversy by qualifying the words other land occupied by the building and the land appurtenant thereto. The expression 'thereto' manifestly shows that the intention of the legislation was to refer to the land on which the building or the dwelling unit stand. In other words, the vacant land which contains a building would include appurtenant land or any other land situated in that particular plot.\" ", "Therefore, the contention that the Act does not apply to a land on which there is a building and a vacant site in the possession of a tenant, is untenable. While calculating the ceiling limit, the entire land has to be taken into account and then work out the excess. Since there will be excess in the instant case, the tenant has to declare the same if really he was in possession and the same as a tenant. The non-mention of the same in the declaration also goes to show that the petitioner did not claim this land as being included in the tenancy. ", "14. Further, some of the correspondence between the petitioner-company and also goes to show that the understanding was that the entire open land was included in the tenancy. By a letter dated 19-11-1966 the petitioner-company informed that they had no objection to his enclosing 2000 sq. yards of land in the corner of the petitioner's office premises. By another letter dated 12-2-1968 the petitioner-company informed that they were surrendering almost the entire portion of the open land to him, but asked him to compensate or adjust the cost of materials in fitting the fixtures. By another letter dated 10-9-1968 the petitioner-company released an additional 5030 sq. yards in addition to the 2000 sq. yards already released. But while releasing the same the petitioner asked to construct first a compound wall as shown in the drawing fully protecting their existing building, at the expense of . When asked for release of some more vacant land, the situation took a different turn. However, this correspondence coupled with the fact that the petitioner-company did not declare the land as excess and also coupled with the fact that the injunction was vacated to the extent of the land exempted, would go to show that the petitioner-company had no claim for the entire vacant land. Otherwise they would not have kept quiet up-till now though they were specifically informed that exemption was obtained in the month of April 1982 itself. We have considered this circumstance only to show that the petitioner cannot be said to be an aggrieved person so far as the vacant land in respect of which exemption is granted. ", "15. All the above mentioned circumstances go to show that the excess open land is not part of the tenancy or at any rate there is any amount of controversy regarding the same which can be resolved only in . Under these circumstances, the petitioner cannot as a matter of right claim that he has suffered a legal injury and consequently he has a right of being heard even at the time of passing the G. O., more so when his rights as a tenant if any are not taken away by the impugned G. O. ", "16. The learned counsel however submits that every person having \"locus standi\" gets an automatic right of being heard. ", "17. \"Locus standi\", as it is understood and enlarged by , operates in a larger area, but right to be heard by the authority making the decision does not necessarily accrue to every person having locus standi to move the questioning such a decision. Hitherto the view was that only \"an aggrieved person\" alone is entitled to a writ of certiorari and if he is a stranger the will in its discretion deny the remedy. But the meaning of the words \"a person aggrieved\" depends much on the facts and circumstances of each case and may also vary according to the context of the statute. In the real sense 'an aggrieved person' is understood to be one who has a grievance because an order been made prejudicial to his interest, and locus standi is generally understood to mean legal capacity to challenge an act or decision. The Supreme hitherto laid down in many cases that in order to have the locus standi to invoke the extraordinary jurisdiction under Article 226 , an applicant should ordinarily be one who has a personal or individual right in the subject-matter of the application, though in the case of some of the writs like habeas corpus or quo warranto this rule is relaxed or modified. But it is also pointed out that this rule is flexible enough to take in those cases where the applicant has been prejudicially affected by an act or omission of an authority, even though he has no proprietary or even a fiduciary interest in the subject-matter. , AIR 1976 SC 578 (supra), speaking for the Bench pointed out that in the context of locus standi to apply for a writ of certiorari, an applicant may ordinarily fall in any of the categories, viz., (i) 'person aggrieved', (ii) 'stranger', (iii) busybody of meddlesome interloper, and the persons in the last category can easily be eliminated. The distinction between the first and the second categories is not well demarcated. The learned Judge however observed thus :- ", "\"The first category has, as it were, two concentric zones : a solid central zone of certainty, and a grey outer circle of lessening certainty in a sliding centrifugal scale, with an outermost nebulous fringe of uncertainty. Applicants falling within the central zone are those whose legal rights have been infringed. Such applicants undoubtedly stand in the category of 'persons aggrieved'. In the grey outer-circle the bounds which separate the first category from the second, intermix, interfuse and overlap increasingly in a centrifugal direction. All persons in this outer-zone may not be \"persons aggrieved\".\" ", "This category of persons falling under the \"grey outer-circle\" may have the locus standi to move the , but it cannot be held that they have also a right to be heard before the authority passes the order. In case (Judges' transfer case) (supra) their Lordships held that the practising lawyers have a vital interest in the independence of judiciary and if any unconstitutional or illegal action is taken by the or any public authority which has the effect of impairing the independence of the judiciary, they would certainly be interested in challenging the constitutionality or legality of such action. One may have locus standi, viz., the legal capacity to challenge the act or order, but he may not have the right to be heard by the authority at the time of passing the impugned order. For the purpose of principles of natural justice the question that matters is whether any legal power has been exercised over the person affecting his legal rights and not whether he has some legal right to move the . ", "18. No doubt there is a clear discernible trend enlarging the rule of locus standi. In case (supra) it is held : ", "\"We would, therefore, hold that any member of the public having sufficient interest can maintain an action for judicial redress for public injury arising from breach of public duty or from violation of some provision of the Constitution or the law and seek enforcement of such public duty and observance of such constitutional or legal provision.\" ", "But their Lordships did not go to the extent of laying down that every member of the public who is competent to move the , also automatically has a right to be heard by the decision-making authority before doing the act or passing the impugned order. It is pertinent to note that the counsel in the Judges' transfer case (supra), also did not go to the extent of seriously contending that they had also a right to be heard by the authority before any transfer of a Judge is made. Similarly in the instant case section 20 of the Act empowers the to grant exemption to a limited extent and the real interested persons are the owners who apply for the exemption. The exemption thus granted does not in any manner take away the existing rights of other persons like the tenants, etc. If the tenant or any other member of the public has locus standi to question the action of the on the ground that there is a specific legal injury suffered by a person or a class or group of persons for whose benefit the Act is intended, then they fall in the \"grey outer circle\" the bounds of which separate the first category, viz., the persons aggrieved from the second viz, strangers. But in given cases such persons falling in the \"grey outer-circle may have locus standi to move the but do not necessarily have an inherent right to be heard by the decision-making authority, particularly before making a decision. Much depends upon variable factors and specific circumstances of the case. ", "19. Therefore, a person merely claiming to be affected for the purpose of being accorded locus standi is not necessarily the same as one whose interests and right have been substantially prejudiced and affected. The grievance of the persons aggrieved whose interests are substantially affected, is not the same as that of the members of the public who can maintain a legal action. ", "20. ., , a question arose whether a member of the public can claim to be heard in an appeal filed by an applicant for a no-objection certificate under the Madhya Pradesh Cinemas (Regulation) Act. Their Lordships noted that there is no provision for inviting objections before the grant of permanent or a quasi-permanent cinema licence and there is no provision in the Madhya Pradesh Act or rules which requires advertisement of such an application inviting objections and consideration of the objections before grant of a cinema licence. On the question whether any member of the public objecting to such a licence would also be heard at the time of granting licence, their Lordships observed thus : ", "\"When the present appellants objected to the renewal of a quasi-permanent cinema licence it was not the stage for grant of no-objection certificate but it was the stage of renewal of quasi-permanent licence subsequent to the stage of granting of a no-objection certificate, when there was no statutory obligation on the licensing authority to invite objections nor were the appellants entitled to file objections and nor were they entitled to be heard. A right to notice by reason of any rule of natural justice, which a party may establish, must depend for its existence upon proof of an interest which is bound to be injured by not hearing the party claiming to be entitled to a notice and to be heard before an order is passed. If the duty to give notice and to hear the party is not mandatory, the actual order passed on a matter must be shown to have injuriously affected the interest of the party which was given no notice of the matter.\" ", "21. , it is observed that a person can be said to be aggrieved only when a person is denied a legal right by some one who has a legal duty to do something or to abstain from doing something. ", "22. In the instant case the impugned G. O. is only in the form of a declaration stating that the vacant land belonging to the respondents is exempted from the provisions of the Act. Therefore, at that stage there is no question of giving a notice to the petitioner by the Government. As discussed earlier, he may have locus standi to question the G. O. by filing this writ petition as a person having interest in the matter, but that locus standi by itself does not give him a right to be heard by the Government, before passing the G. O. ", "23. Yet, another submission on the same lines is that the petitioner is thrown to the jeopardy of eviction and, therefore, he is prejudicially affected and that he has a legitimate interest in the vacant land because he has a reasonable expectation of the excess land being allotted to the petitioner-company which is promoting trade and industry which also subserve the common good. Reliance is once again placed on v , (supra), wherein it is held that the workers who would be the aggrieved persons, are entitled to be heard at the hearing of the winding up petition of a company. We have already held that the petitioner cannot be placed in the same position as that of a worker. Reliance is also placed on v. , , wherein it is held that the sugarcane growers are to be heard before granting exemption to the factories from payment of additional price. Re , (1972) 2 All ER 589, is yet another case wherein it is held that hearing should be given to all those affected by granting or refusing applications for licences. These are all cases where persons have direct and substantial interest in the matter and are affected by the act of the authority. In the instant case, as already held, the rights of the petitioner as a tenant are not in any way affected. Equally the contention that the petitioner has a reasonable expectation of getting the land allotted and therefore he is a person aggrieved, also is devoid of force. That way there may be many members of public reasonably expecting the allotment by the after the excess land is taken over, but that does not mean that the should go on giving notices to all the members of the public and hear them at the time of disposing of an application for exemption. Practical considerations also sometimes do exclude a right to hearing. In v. , (1971) 1 Ch. 233, refused to hold that an architect issuing notices to contractors under the standard contract was obliged to give a hearing to the contractor, and observed : ", "\"It is the position of independence and skill that affords the parties the proper safeguards and not the imposition of rules requiring something in the nature of a hearing.\" ", "The learned Judge also observed : ", "\"The principles of natural justice are of wide application and great importance, but they must be confined within proper limits and to run wild....... For the rules of natural justice to apply there must be something in the nature of a judicial situation.\" ", "Therefore, it is futile to contend that the petitioner who has a reasonable expectation of the site being allotted to him, acquired a right of being heard before giving exemption. As already mentioned, it is the nature of the decision that matters and a grant of exemption under Sec. 20 of the Act does not in any way affect the rights of the petitioner who claims to be a tenant. Nor such an exemption can be equated to final determination of the rights of the parties. For all these reasons, we are not able to agree with the learned counsel for the petitioner that there is violation of the principles of natural justice. ", "24. The next submission of the learned Counsel for the petitioner is that the Government has acted arbitrarily in granting this exemption and therefore the petitioner has locus standi to question the same. According to the learned counsel the Government has not kept in view the guidelines envisaged in G. O. Ms. No. 186 Revenue (UC-II) Department, dated 2-3-1977 and has not made proper enquiry regarding the genuineness of the deed of agreement and that had they made such an enquiry they would have found out that the agreement was not genuine. It is also his submission that the Government did not even make enquiries about the presence of a tenant and this itself shows that the Government acted in an arbitrary manner. It is true that G. O. Ms. No. 186 was issued laying down certain guidelines in the matter of granting exemption under Sec. 20 of the Act. In the preamble it is noted thus : ", "\"A large number of cases have been brought to the notice of State Government where some persons have entered into agreements to sell their urban lands to certain Housing Co-operative Societies, individuals, etc., after taking considerable amounts as advances and also obtained permission under the Andhra Pradesh Vacant Lands in Urban Areas (Prohibition of Alienation) Act, 1972 to alienate the land but could not register the sale deeds as the Urban Land (Ceiling and Regulation) Act , 1976 came into force in the meanwhile. With a view to avoid hardship and civil litigation in recovery of the amounts advanced if transactions are not finalised, many requests have been made by the transferors as well as transferees that such land may be exempted from the provisions of Chapter III of Urban Land (Ceiling and Regulation) Act , 1976 so that the sale deeds for the lands so transferred may be registered in favour of the transferees in accordance with the agreement already entered into.\" ", "Then it is stated that the Government have examined the matter and considered it necessary to lay down some guidelines to facilitate rapid proceedings of exemption applications in such cases. Some of the guidelines are as follows :- ", "\"(a) that the land-holder was granted permission by the Government under Andhra Pradesh Vacant Land in Urban Areas (Prohibition of Alienation) Act, 1972 (Act 12/72) for the alienation of such land. ", "(b) that the genuineness of the deed of agreement is established by documentary evidence which cannot be fabricated. ", "xxx xxx xxx xxx.\" ", "According to the learned counsel, the has not kept in view the guideline regarding the genuineness of the deed of agreement. It is submitted that in the deed of agreement of sale dated 13-5-1975 it is mentioned that an advance of Rs. 10,000/- was paid through cheque No. 408706 dated 18-11-1974, but whereas according to another version the amount was paid under the same cheque as advance for purchasing the Padmaraonagar property and an enquiry would have shown that Cheque No. 408706 is being used as documentary evidence to prove the genuineness of the deed of agreement though in fact it was meant for other transaction and therefore it must be held that the acted arbitrarily without enquiry, in granting the exemption. We are unable to agree. Merely because there is a reference to the cheque in the agreement it does not matter at all when once both parties have agreed that the particular advance is made through that cheque. The had examined the same and was satisfied about the genuineness of the agreement. To which transaction it was being utilised is a matter purely within the parties. The owners have filed an application for exemption, and on the basis of an agreement engrossed on a stamp-paper and the extract of the non-judicial stamps sale register would also show that the owners purchased stamps bearing S. Nos. 6916 and 6917 in the year 1975 itself. Therefore, the purchase of the stamps on which the agreement was engrossed cannot be doubted and when there is a mention about the cheque in that, and when in fact the cheque has been encashed by the owners, that is sufficient proof so far as the is concerned. Further, there is a report of the Special Officer in this regard. Therefore, it cannot be said that there is no enquiry at all and that the arbitrarily granted the exemption. In this context it is also to be noted that the exemption is subject to the condition that the land must be used for the construction of the Nursing Home. The object underlying the Act, viz., that the distribution of land to subserve the common good, is kept in view in granting the exemption inasmuch as building a nursing home would subserve the common good. Therefore, the contention that the has not applied its mind while granting the exemption has no force. ", "25. In this context it is also submitted that there cannot be such an exemption permitting the owner to sell, as such a sale would defeat the very purpose of the Act. But a perusal of the exemption order shows that the Government has kept in view the scope of section 20(1)(b) of the Act, viz., undue hardship to some person. But at the same time it has also kept in view the object of the Act in granting exemption. The sale permitted is not an absolute one. Though the owners are permitted to sell it to a particular person because of the hardship of having already entered into an agreement and which kind of sale also is permitted under G. O. Ms. No. 186, yet the land is diverted to be utilised only for the construction of a nursing home, which subserves the common good. Therefore, such an exemption cannot be said to have been given by the Government without applying their mind. ", "26. The main important point raised by the petitioner's learned counsel is that the exemption order is vitiated by fraud. Both sides have advanced lengthy arguments on this aspect. For a better appreciation, a few more facts on this aspect have to be noted. Late Sri had vast properties including some buildings at Padmarao Nagar in Secunderabad. Smt. the 6th respondent herein, by an agreement of sale dated 19-11-1974, sold the house bearing Municipal No. 6-1-125 at Padmarao Nagar, with open land, to Sri , Managing Partner of the 8th respondent, for a sum of Rs. 25,000/- and she received a cheque dt. 18-11-74 for Rs. 10,000/- drawn on , Hyderabad, towards the sale consideration. The sale deed was executed with respect to the said house on 10-7-1975 and the same was registered on 14-7-1975. According to the petitioner the cheque dated 18-11-1974 issued for Rs. 10,000/- was towards the advance for the purchase of the Padmarao Nagar house property, but the same cheque was mentioned in the agreement of sale dated 13-5-1975 and the respondents misrepresented before the Government that the agreement is a genuine one supported by consideration paid by way of cheque No. 408706 which cheque has in fact nothing to do with the transaction regarding the land in dispute. Therefore, according to the learned counsel, with a view to make it appear that the agreement dated 13-5-1975 regarding the sale of the vacant land in question is a genuine one and to satisfy the requirements of G. O. Ms. No. 186 regarding the genuineness of the deed of agreement to be established by documentary evidence, the respondents have pressed into service the cheque meant for a different transaction and made the Government believe that the agreement is a genuine one and thus they have played fraud on the Government and the other authorities and therefore the impugned G. O. is illegal and is a nullity. Before we take up the plea of the respondents we shall consider the principles of law governing a case of fraud. ", "27. In v. , (1956) 1 All ER 341, it is observed by thus :- ", "\"No in this land will allow a person to keep an advantage which he has obtained by fraud. No judgment of a court, no order of a Minister, can be allowed to stand if it has been obtained by fraud. Fraud unravels everything. The is careful not to find fraud unless it is distinctly pleaded and proved; but once it is proved it vitiates judgments, contracts and all transactions whatsoever.\" ", "In his classic book \"Administrative Law\" Fifth Edition referred to , 's observations in Estates case supra and at page 228 noted thus :- ", "\"In administrative law, which was not the context of this statement, there is only scanty material to illustrate it, although in principle it ought to be correct. The only field in which there are examples is immigration law, where it is held that leave to enter given by an immigration officer is vitiated if it has been obtained by any kind of fraud, deception or mis-representation on the part of the immigrant. has gone so far as to hold, in an exceptional decision, that an immigrant has a positive duty to disclose all material facts, even if he is not asked about them, and that if he fails to volunteer relevant information he is guilty of deception and his leave to enter is nullity. A decision of an inferior tribunal obtained by fraud, for example by perjured evidence, may be quashed by on certiorari.\" ", "28. In Halsbury's Laws of England, Fourth Edition, at page 110, Para 88 in the Chapter \"Administrative Law\" reads thus :- ", "\"88. Fraud and perjury:- An order of certiorari may be made to quash an order which has been obtained by fraud, as where an untrue charge has been knowingly made by the prosecutor, or by means of collusion between the parties, and it seems where the decision was made on the strength of perjured evidence; but it appears that the court will not quash the order unless it is satisfied that the person in whose favour the order was made could have been convicted of the fraud or perjury whereby the decision was procured.\" ", "29. In Judicial Review of Administrative Action, Fourth Edition at page 408, the paragraph dealing with \"Fraud or Collusion\" is in the following terms :- ", "\"The superior courts have an inherent jurisdiction to set aside order and convictions made by inferior tribunals if they have been procured by fraud or collusion........... a jurisdiction that is now exercised by the issue of certiorari to quash. Where fraud is alleged, the court will decline to quash unless it is satisfied that the fraud was clear and manifest and was instrumental in procuring the order impugned.\" ", "30. for , (1982) 1 WLR 405, is a case where a citizen of Sri Lanka applied and was granted an entry clearance to enter the United Kingdom as a visitor, on the basis that he was unmarried, though he was married and his wife was in U.K. He entered the U. K. and applied for extension admitting that he was married. The Home Officer refused extension and he appealed to an adjudicator who formed the view that the leave was granted to the appellant due to his deception and therefore he was an illegal entrant and should be removed from the United Kingdom. And in the ultimate appeal to the Court Lord while allowing the appeal observed thus : ", "\"Coming back to what I said at the beginning, the deception must be of decisive character. It is only decisive when, if the immigrant know the true facts and did disclose them, the immigration officer would have been bound to refuse or would in all probability have refused the entry : otherwise, if the deception is neutral, as in our present case, it is not of such a decisive character and the leave to enter is not vitiated.\" ", "31. From a consideration of the decided cases and the relevant passages in the authoritative text books, it emerges that any judgment or order of an administrative authority is a nullity if obtained by fraud and the same can be questioned before a . But where fraud is alleged, the will decline to quash unless it is satisfied that the fraud was clear and manifest and was instrumental in procuring the order impugned, and the deception must be of a decisive character not 'neutral'. ", "32. Bearing the above principles in mind, we shall examine the plea, taken by the respondents in the counter filed by the 8th respondent. The allegations made by the petitioner regarding the alleged fraud are contradicted. It is mentioned that the advance of Rs. 10,000/- by way of cheque dated 18-11-1975 meant for the purchase of the disputed vacant land, was not encashed by the owners and it was adjusted towards the house property purchased at Padmaraonagar and a cash consideration of Rs. 10,000/- was paid to the owners. The receipt of the consideration under the sale deed or under the agreement of sale is not disputed by the owners. It is further stated, \"Therefore it is not open to the petitioner to mention anything or try to make that the fraud is played therein. When there are two transactions between the same parties, it is open to them to adjust the money from one transaction to the other provided the entire consideration under both the transactions is received by the owners. In this case the entire consideration was received by the respondents 4 to 6 and they executed and registered a sale deed\". Before we proceed to scrutinise the explanation in the light of the further averments in the additional counter-affidavit, it may be necessary to refer to the relevant documents. In the registered sale deed dated 10-7-1975 under which the 6th respondent sold the Padmaraonagar house property it is mentioned that the vendee agrees to purchase the property by virtue of an agreement of sale dated 19-11-74 whereupon he paid by a cheque an advance amount of Rs. 10,000/- by cash Rs. 5,000/- on 28-11-1974 and given in cash Rs. 5,000/- on 25-3-1975 in all Rs. 20,000/- to the vendor the receipt of which the vendor acknowledges, and the balance of Rs. 5,000/- was paid on the date of registration. In the agreement of sale dated 13-11-1975 regarding the sale of the vacant land in question, it is mentioned that the purchasers have offered to purchase building No. 9-1-87 along with appurtenant land admeasuring about 7000 sq. yards at the rate of Rs. 115/- per sq. yard and have paid a sum of Rs. 10,000/- and the vendors have accepted the offer and have agreed to sell the said building along with the appurtenant land under the terms and conditions mentioned in the agreement, in pursuance of the agreement reached on 18-11-74. In one of the recitals it is specifically mentioned that the vendors had received from the purchasers a sum of Rs. 10,000/- through cheque No. 408706 dated 18-11-1974 drawn on , Hyderabad, issued by way of advance by virtue of an agreement of sale dated 18-11-1974 in respect of Padmaraonagar house property. Under the registered sale deed in respect of the Padmaraonagar house property it is only mentioned that a cheque was issued for Rs. 10,000/- on 18-11-1974. In the agreement of sale dated 13-5-1975 referred to above, there is a reference to the cheque No. 408706 dated 18-11-1974 for Rs. 10,000/-. The case of the learned counsel for the petitioner is that there is only one cheque and that has been used in both the transactions and thus misled the and the averments in the counter-affidavit that the cheque was not encashed by the owners and \"it was adjusted towards the house property purchased at padmaraonagar\" also affirms the same. In the additional counter filed, the respondents have explained the position. It is stated that there were two oral agreements entered into on 18-11-1974 one for the Sangeet Theatre property, i.e., the building and land under the possession of the tenant through cheque No. 408706 dated 18-11-1974 for Rs. 10,000/-. It is also explained that cheque No. 408706 was presented and credited to the account of Smt. towards the consideration of the Sangeet theatre property, i.e., the property in question, and some more amounts were paid and the total sum came to Rs. 80,500/-. It is also explained that the house at Padmaraonagar was also negotiated and was agreed to be purchased and cheque No. 408707 for Rs. 10,000/- dated 18-11-1974 was issued, that as there was not enough money in the bank a request was made to the owner not to present the cheque, and in the meanwhile the purchasers paid Rs. 10,000/- on two dates i.e., on 28-11-1974 and 23-3-1975 and the cheque was taken back before registration of the sale deed on 10-7-1975 and Rs. 10,000/- was paid as against the time-barred cheque No. 408707 and the balance of Rs. 5,000/- was also paid on the day at the time of registration and thus a total sum of Rs. 25,000/- was paid. ", "33. The learned counsel for the petitioner submits that the explanation is belated and it does not fit in with the averments made in the earlier counter-affidavit. It must be pointed out at this stage that the fraud alleged must be proved positively. That there are two transactions is not in dispute. The statement of the bank account also shows that the amount of Rs. 10,000/- by cheque No. 408706 was debited to the account of the 8th respondent. It also shows that the cheque No. 408706 was not utilised. However, these are all not the details to be gone into by the at the stage of granting exemption. The parties have agreed before the that there was such a transaction. The owners applied for exemption, they have acknowledged the receipt of Rs. 10,000/- by way of cheque No. 408707 and the same is recited in the agreement of sale dated 13-5-1975. As already mentioned, the extract from the non-judicial stamps register also shows that two non-judicial stamps were also purchased by Sri s/o . It is on the same stamp papers that the agreement in question was engrossed and there is a reference to cheque No. 408706. By placing all this material before the , it cannot be said that the respondents misrepresented and played fraud. Even in the original counter there is no reference to a particular cheque No. When there are two transactions, as to how the parties adjusted the advances in respect of them, is not a matter concerned with third parties. The documents undoubtedly show that cheque No. 408706 was issued by the 8th respondent to Smt. and there is a reference to this cheque in the agreement. It may be, as explained by the respondents, that this cheque was used towards advance of sale consideration of the land in question and by way of an adjustment and accommodation another cheque bearing No. 408707 was issued with a request not to present the same for encashment and with a promise to pay the cash as against the cheque soon, and on 10-7-1975 according to the respondents they paid Rs. 10,000/- in cash and took back the cheque. It can, therefore, be seen that cheque bearing No. 408707 must have been given by way of security, and the same was purely a personal arrangement between parties. So far as the is concerned, the agreement of sale dated 13-5-1975 was presented before them by the declarant and the cheque No. also was given and the same must have been verified by the to test the bona fides of the transaction. As observed in 's case (1982) 1 WLR 405 (supra), the alleged deception should be in respect of material facts which the party was obliged to disclose. In v. , (1956) 1 QB 167, it is observed that where fraud is alleged the Court will decline to quash unless it is satisfied that the fraud was clear and manifest and was instrumental in procuring the order impugned. ", "34. In the instant case the adjustment of advance money in respect of Padmaraonagar house property is not a material fact that ought to have been disclosed by the respondents. Therefore, it cannot be said that fraud has been proved so as to warrant the quashing of the impugned G. O. ", "35. For all the aforesaid reasons, this writ petition (W. P. 3568 of 1984) has to be dismissed. ", "36. W. P. No. 5449 of 1985 :- The petitioner herein is no other than the 7th respondent in W. P. No. 3568 of 1984. She is the daughter of late Sri . In her affidavit it is averred that the property in question is the ancestral property and she being the daughter of late Sri , she is entitled to a share and she is affected by G. O. Ms. No. 4778 dated 11-11-1980 permitting the alienation. The submissions in this writ petition are more or less on the same lines as in the other writ petition. Therefore, we need not again deal with those points, which we have already decided in the other writ petition. ", "37. One of the other submissions in this writ petition is that the 7th respondent (the petitioner herein) has a share in the property and without giving notice and without hearing her the Government ought not to have passed the G. O. It is also submitted that she was not a party to the agreement executed in favour of and that she also did not apply for exemption and therefore the exemption order which is thus obtained behind her back has to be quashed. ", "38. It is true that the petitioner herein is not a party to the agreement. About her share in the property there cannot be any dispute. But the two sons and the wife of late Sri , who had a major interest in the property in question and who had entered into an agreement to sell the land, had every right to apply for exemption. The property as a whole was mentioned and further it is an undivided property belonging to the joint family and of the family as well as the other two shareholders filed an application for exemption in view of the agreement of sale executed by them, and the exemption is to the benefit of the entire family. As discussed above, in the other writ petition the G. O. does not compel anybody to sell. The 7th respondent can even now refuse to sell her share to . As to what extent and which part of the property falls to her share, is a matter to be worked out in a partition. By passing the impugned G. O. the 7th respondent is not legally compelled to sell. Even now she can apply to the Government and ask to consider her declaration. ", "39. The learned counsel placed reliance on a decision of in ., . Wherein it is held that opportunity of being heard should be given to a claimant before rejecting an application under section 20 of the Act. There cannot be any dispute about this principle, but we are unable to say as to how this decision helps the 7th respondent. Here in the instant case exemption is granted on the basis of an application filed by the members of the joint family. That does not in any way affect the interests of the 7th respondent (petitioner herein) nor restrict her rights to deal with her property as she likes. For all these reasons this writ petition is liable to be dismissed. ", "40. In the result both the writ petitions are dismissed with costs. Advocate's fee Rs. 150/- in each. ", "41. An oral application is made for leave to appeal to . We are of the view that the case does not involve any substantial question of law of general importance which needs to be decided by . The oral application is dismissed. ", "42. Only the trial of R. C. No. 141 of 1982 is stayed for three weeks. ", "43. Petition dismissed."], "relevant_candidates": ["0000639803", "0001125994", "0001294854", "0001455346", "0001749406", "0001766147", "0125891500", "0152464582", "0182932605"]} {"id": "0000765491", "text": ["PETITIONER: UNION OF INDIA & ORS. Vs. RESPONDENT: LT. GEN. & . DATE OF JUDGMENT: 28/07/2000 BENCH: CJI., , & , JUDGMENT: ", " J. : ", "The dispute in this case is in regard to the appointment to the post of Commander. When Lt.Gen. [hereinafter referred to as respondent No.2] was appointed or promoted as the Commander, , the same was challenged by Lt. Gen. [hereinafter referred to as respondent No.1] by way of a writ petition (Civil Writ No. 1527 of 1998) in principally on the ground that he is the senior-most eligible officer to be appointed to that post; that he was seeking the aid of the court to prevent unnecessary and avoidable aberration with regard to appointment/promotion of senior officers in the and keeping in view the long term interest of the and the country so as to avoid politicalisation of the crucial posts in the ; that he had won various meritorious awards; that he commanded a company in Nagaland and was awarded Vishist Seva Medal (VSM) on January 26, 1990 and as a Major General he commanded , rifles and (BSF) and he was successfully able to bring cease fire in 1997 which is still holding; that he was awarded Ati Vishist Seva Medal (AVSM) on February 26, 1998 for his operational success and outstanding achievement; that he commanded a company in the Bangaladesh war; that his contribution in Operation Black Thunder was awarded The Chief of Staffs Commendation in 1985; that he has the requisite staff experience and has served on the staff of and in Operational appointments; that he from the rank of Lt. Colonel onwards has attained all his select promotions in the first chance through unanimous decisions; since 1997 he has been in command of the oldest and the most prestigious strike of the ; that the appointments and promotions to the post of Commander/Vice Chief of the Staff (VCOAS) are governed by the instructions as contained in the letter dated October 20, 1986; that the said letter came into effect from January 1, 1989; that he became eligible to be promoted as Commander as and when vacancy arose and instructions issued by the were amended on November 18, 1996 which prescribe an additional criteria for appointment to the post of Commander, namely, that the officer should have commanded a for at least one year so as to become eligible for appointment as Commander/VCOAS and no waiver in this stipulation is allowed without prior concurrence of the ; that the order dated November 18, 1996 has come into effect only to affect respondent No.1; that even otherwise in relation to such stipulation he had been granted a waiver by the as prescribed by letter dated November 18, 1996 as per the order dated March 16, 1998; that he was fit in all respects for appointment to the post of Commander; that the second appellant had recorded in Annual Confidential Reports (ACRs) in respect of respondent No.1 that on or after February 27, 1998 he was fit in all respects; and, that having found respondent No.1 fit in all respects on or after February 27, 1998 and he being the senior most Lt. General in the Indian ought to have been appointed as Commander. ", "Respondent No.1 claimed that when he was posted as Attache in Paris he was considered for the post of Major General on April 24/25, 1992 wherein he was approved for being promoted as Major General and the said decision was communicated to him on July 7, 1992. However, he was promoted to the post of Major General on September 1, 1995 after respondent No.1 was repatriated from Paris. for selecting Lt. General met on October 21, 1994, the decision of which was communicated to respondent No.1 on February 21, 1995. The case of respondent No.1 was deferred on the ground that the criteria appointment was lacking. Again on April 21/22, 1995 his appointment as Lt. General was deferred on the ground not adequately exercised in criteria appointment. Similarly, his case was again deferred on October 11/13, 1995 and on April 24/25, 1996. On October 31, 1996 his case was recommended to be promoted as Lt. General. It was contended before that for certain irrelevant consideration and mala fide reasons the case of respondent No.1 was deferred by to accommodate Major General who was made a Lt. General; that such deferment of the case of respondent No.1 by was unprecedented in the history of . Respondent No.1 sought for review of the decision regarding change of his grading from approved to deferred by an application made on March 8, 1997. On April 10, 1997 respondent No.1 was again considered by to the post of Lt. General. ", "The decision thereto was conveyed to him on July 8, 1997. It is at this stage that the Chief of the Staff had issued letters/instructions stipulating that henceforth an officer to be eligible to become Commander/VCOAS should have commanded a for at least one year. That is the first time such a stipulation had been introduced in the and made applicable with immediate effect. On a representation made by respondent No.1 waiver was granted for a period of six months for his consideration for promotion to the rank of Commander/VCOAS. It was contended on behalf of respondent No.1 that 2/3 days after respondent No.1 was recommended for promotion by respondent No. 2 (Appellant No. 2 herein) on March 2, 1998 a proposal was mooted for appointment of the Commander, for filling up the vacancy that arose on March 1, 1998 when respondent No.2 was recommended for promotion/appointment to the post of Commander, . On respondent No.1 approaching on March 27, 1998, while directing notice it was made clear that if any appointment is made to the post of Commander, , the same shall be subject to the result of the writ petition. It was contended before that for the first time more than one officer was considered at the time of making the recommendations for appointment or promotion to the post of Commander in the Indian ; that in the past only name of senior most officer was forwarded and recommended for appointment/ promotion as Commander; that respondent No.1 was recommended for appointment as Commander; that when the statutory complaint was filed by respondent No.1, appellant No. 2 had recommended to appellant No. 1 the name of respondent No. 2 and, therefore, the impugned decision dated March 25, 1998 with the recommendation was sent to the name of respondent No. 4 for promotion/appointment as Commander, in supersession of respondent No.1 is bad in law. ", " first dealt with contention that stay of respondent No.1 in Paris should not come in his way for purpose of selection to a higher post. After going through the entire files it was noted that had respondent No.1s promotion not been deferred, he would have become Lt. General in 1996 itself although Major General was promoted as Lt. General in spite of grading unfit to him by . Surprisingly on November 23, 1996 the Defence Secretary recommended that Major General s grading may be changed from Grade D to Grade B and in the case of the petition his grading from fit was recommended to be deferred and the Defence Secretary relied upon the fact that respondent No.1 has not completed the laid down adequately exercised period of 18 months. commented on the manner of dealing with the files as rather strange and observed that there is inconsistency in the arguments advanced on behalf of the appellants inasmuch as only seniority of an officer is important; that the words senior most officer who is otherwise fit should be understood as that an officer whose name has been recommended by the is also fit in all respects. On perusal of files, came to the conclusion that the second respondent could never be deemed to be senior most officer who was otherwise fit and could not be compared with respondent No.1; that recommendation is in total disregard of the past practice and procedure; that the cases referred to are those of senior general officers, namely, Lt. General , and , who missed promotion to the rank of Commander on comparative merit and weak profile; that the note of the Joint Secretary admitted that in these cases there was no recommendation for promotion on account of their C.Rs. However, proposed to consider their cases separately. further concluded that from the records made available to the court it was evident that in the past only the senior most Lt. General was considered for promotion to the rank of Commander in the vacancy arising as happened due to the retirement of Lt. General ; that the cases of Lt. General and Lt. General were recommended for promotion/appointment as GOC-In-C, ; that the reason for not appointing Lt. General was that he was placed in low medical category. ", " found force in the argument that comparative merit was not the requirement to be applied by the appellants; that the general officers meeting the requirement of letter dated October 20, 1996 were promoted as Commanders on the basis of the seniority; that fitness in every respect coupled with seniority is the criteria of appointment to the post of Commander, and it noticed that the appellants could not go into the question of comparative merit to the post of Commander when respondent No.1 carrier profile, experience, positive recommendation in the A.C.R. makes him fully fit for holding the post of Commander, any other consideration which has gone into the process of denying that right is not justifiable if respondent No.1 was eligible in terms of policy of the appellants dated October 20, 1986 particularly when the appellants have considered his case for waiver which was granted by six months and when respondent No.1 stayed in Paris for a duration longer period and that the same cannot be utilised against him. ", " also noticed that he had given his willingness certificate is not correct from the perusal of the records and he should have been repatriated on completion of three years which was not done. also took into consideration the statutory complaint made by respondent No.1. It was noticed that on February 27, 1998 when the Chief of the Staff had found respondent No.1 fit in every way to hold his present rank as well as found him fit for promotion to the next higher rank/appointment, how the name of respondent No. 4 could have been recommended on March 2, 1998. Therefore, critically analysed the Cabinet Secretarys notice and found that respondent No.1 fulfilled the necessary criteria mentioned for promotion to the post of Commander. laid emphasis on the criteria seniority-cum-fitness rather than seniority-cum-merit and what is obligatory is that the promotion is automatic. Finally, noticed that the only question before it whether the post of Commander which became available on March 1, 1998 on the retirement of Lt. General when the cases of respondent No. 1 and respondent No. 2 were considered whether the appointment of respondent No. 2 as Commander in spite of respondent No. 1 being admittedly senior to respondent No. 2 was justified. noticed that the argument advanced on behalf of the appellants that the Circular dated October 16, 1992 was complementary to the Circular dated October 20, 1986 does not inspire any confidence and it is not one of those orders issued in terms of Article 73 of the Constitution. The whole rationale, therefore, was of the principle of seniority-cum-fitness and thus considered, the senior person unless unfit should get the promotion automatically and, therefore, seniority ought to have been given preponderating weight. Further, It noted that the appointment of commander is a selection grade appointment to be filled from eligible Commander. Prior to 1986 Commanders subject to having positive recommendation in their A.C.Rs. became commanders In 1986 a criteria of two years residual service was introduced for their becoming Commanders subject to their being fit in every respect. General Officers meeting the said criteria was promoted in the order of their seniority. One year command of a was added to the criteria prescribed in 1986 by letter dated November 1996 which also provided for a waiver by the competent authority. The note of the Cabinet Secretary in which he has comparatively discussed the A.C.Rs. of 1971 of respondent No.1 amounts to importing a non- existent criteria after respondent No.1 was found fit in all respects in the A.C.R. on the basis of which he was promoted to next higher rank. The minimum tenure of one year as commander had also been met by respondent No.1 on account of grant of waiver by the Government. The deferment made in the grading in October 1996 of had adversely affected respondent No.1 and it is only thereafter stipulated that an officer to become eligible to be an Commander should have commanded a for at least one year. In this background, quashed the appointment of respondent No. 2 as Commander, and allowed the writ petition. ", "Challenging this order of the learned Single Judge of a Letters Patent Petition (L.P.A No. 568/98) was filed before of . By a very short order of disposed of the Letters Patent Petition stating that the comparative merit of officers was neither the requirement nor it is permissible and the appellants should not have treated the post of Commander as a selection post. is in agreement with the opinion of the learned Single Judge that in the past only a single person was considered and if he is not fit, then alone the next person in seniority was considered. Reliance placed by the on Circular dated October 16, 1992 is not correct and was rightly rejected by the learned Single Judge inasmuch it is a non- statutory document. This is not the case of seniority-cum-merit but it is only seniority-cum-fitness subject to rejection on the basis of being unfit. Seniority alone governed the matter. On that basis dismissed the appeal. Hence the present appeals - one filed by and its officers (Civil Appeals Nos. 359-360 of 1999) and the other (Civil Appeals Nos. 361-362 of 1999) by Lt. Gen. , respondent No. 2 in Civil Appeals Nos. 359-360 of 1999. ", "In this Court, the learned Attorney General contended on behalf of that had erred in quashing the appointment of respondent No. 2 as Commander, ; that the entire consideration of the matter is mis-placed; that had given undue importance to A.C.Rs. in the matter of promotion and when security of the country is of paramount consideration, mistakes cannot be allowed and gaining necessary field experience is absolutely essential; mere emphasis on the A.C.Rs. will not change the ground realities and, therefore, whatever may be the circumstances in which the appellant could not gain the necessary experience; that could not have interfered with the impugned action. has indulged in nit picking by making a censorious approach in examining the dossiers and files as also the note of the Cabinet Secretary; that the comparative merit is not prohibited in making the selection, which was quite often resorted to in making appointments to the post of Commander. , learned Senior Advocate appearing for respondent No. 2 and appellant in connected matter, supported the contentions of the learned Attorney General and supplemented the same on factual aspects. ", ", learned senior advocate for respondent No.1, submitted, at the very outset, that decision in this case is of great momentous nature to the army inasmuch as the principles relating to the promotion to the post of Commander, that is, in the highest echelons of service are in issue. Indeed he submitted that up to the stage of appointment as Lt. General, rigorous tests have to be undergone by the concerned officers before they are promoted and such processes have been undergone having reached a particular level. Further tests are held almost automatically unless there is something adverse as to their fitness. He stated that in these cases it is only seniority that governs and that when it was ignored the matter was taken to and has given relief in this case and, therefore, this should not interfere in the order made by it. Respondent No.1 has always been senior to respondent No.2 by as many as 40 places although they belonged to the same batch having been commissioned on 10.6.1962. Respondent No.1 had a distinguished career and participated in the operations of 1971 Indo-Pak war and also has extensive counter insurgency experience. The battalion in which respondent No.1 was working during the war was engaged in fighting the enemy from Agartala to Dhaka and reached Dhaka on December 16, 1971 i.e. the date of cease-fire and surrender of the Pakistan . In terms of letter dated November 18, 1996, the officer should have commanded for at least one year so as to become eligible for appointment as Commander unless waived with the prior concurrence of the . As respondent No.1 was the only person to be affected by this new criterion which was sought to be enforced without any lead time, contrary to the earlier practice, in his statutory complaint dated 5.10.1997, he made an alternative request that this stipulation may be waived in his case as the delay in his promotions have been caused entirely in the interest of service and he specifically mentioned that the vacancy was due to occur on March 1, 1998 and he should be considered for the same. On 6.1.998, the Chief of the Staff recommended the waiver by months for consideration for promotion to the appointment of Commander for a vacancy occurring on March 1, 1998. accepted the recommendation of the Chief of the Staff. The case of respondent No.1 would have been considered for appointment for the Commander in normal circumstances had he not been inordinately delayed in being placed on present criteria appointment. The delay was caused due to circumstances well beyond the control of respondent No.1 and was primarily due to administrative constraints of the organisation. New clause of tenure of one year as a Commander affected only respondent No.1 and this aspect was borne in mind by the Chief of the Staff while making the recommendation. On 10.4.1997, respondent No.1 was selected for the post of Lt. General by and on 8.7.1997, he was intimated of the fact of selection and approval by the . In another case filed by Major General , the Delhi High passed a stay order in July, 1997. On 23.8.1997, respondent No.1 was put in-charge of GOI-1 and started gaining experience of commanding the and continues to command the same even now. Thus submits that in terms of letter dated November 18, 1996, it is enough if the officer has commanded a for one year by the date of appointment to the post of Commander in the absence of waiver or including the period of waiver. The appointment to the post of Commander having been made by an order dated 20.4.1998, as on that date respondent No.1 had actually commanded 1 for a period of seven months and 26 days; adding the period of waiver of six months, it comes to a total of one year, one month and 26 days. In other words, he fulfilled the requirement of commanding a for at least one year by February 22, 1998. Therefore, he was eligible for consideration for the post in question and that he was rightly treated as eligible both by the Chief of the Staff as well as by the of India. He relies on the decision of this in , 2000 (1) SCC ", "128. The criterion that the officer should be fit in every respect for such appointment stipulated in the letter dated October 20, 1986 clearly indicates that the post of Commander is a non-selection post. In contrast, the nature of selection posts in the should be gathered from the selection system. ", "The hierarchy in the and the method of selection and promotion to various posts starting from the post of Lieutenant and going up to the post of the Chief of the Staff will clearly indicate that the posts of Lieutenant, Captain and Major are automatic promotion posts on passing the promotion examination irrespective of inter se merit, whereas the posts from Major to Lt. Colonel, Lt. Colonel to Colonel, Colonel to Brigadier, Brigadier to Major General and Major General to Lt. General are all selection posts filled up by promotion on the basis of relative merit assessed by the designated selection boards. From Lt. General [Corps Commander] to Commander is a non-selection post to which promotion is made subject to fitness. It is promotion subject to fitness in all respects, although the rank remains the same. From the post of Commander to that of the Chief of the Staff, it is by promotion for which no specific criteria have been laid down. There have been precedents where the senior-most Commanders have not been appointed as the Chief of the Staff. Selection implies the right of rejection depending upon the criteria prescribed. Selection for promotion is based on different criteria depending upon the nature of the post and requirements of the service. Such criteria fall into three categories, namely, ", "1. Seniority cum fitness, ", "2. Seniority cum merit, ", "3. Merit cum suitability with due regard to seniority. ", "Wherever fitness is stipulated as the basis of selection, it is regarded as a non-selection post to be filled on the basis of seniority subject to rejection of the unfit. Fitness means fitness in all respects. Seniority cum merit postulates the requirement of certain minimum merit or satisfying a benchmark previously fixed. Subject to fulfilling this requirement the promotion is based on seniority. There is no requirement of assessment of comparative merit both in the case of seniority cum fitness and seniority cum merit. Merit cum suitability with due regard to seniority as prescribed in the case of promotion to necessarily involves assessment of comparative merit of all eligible candidates, and selecting the best out of them. ", " insisted that the letter dated October 20, 1986 containing the criteria for selection laid down by the President for the Commander does not prescribe any minimum merit. In fact the word merit is conspicuously absent from the entire letter and the criteria do not postulate the comparative assessment of merit for appointment as Commander or Lt. Generals in the same rank. ", " further contended that the use of the word selection in a rule or administrative instruction does not necessarily make the post concerned a selection as has been contended by the appellant. Nor the expression selection grade used by respondent No.1 here and there makes the post in question a selection post to be filled in by promotion on the basis of comparative assessment of merit. In addition to the absence of merit being one of the criteria for selection and promotion to the post of Commander, the past practice as recorded by the Defence Minister and concurrently found by the courts below shows that the senior-most Lt. General who is found fit in all respects for promotion according to the C.Rs. has always been promoted. ", " also submitted that circular dated 28/16.10.1992 of to the extent it applies to the appointment of Commanders and is at variance with the letter dated October 20, 1986 setting out the criteria laid down by the President for appointment of Commanders cannot be acted upon. In so far as the said circular provides for appointment of Corps Commander as the caption of the circular indicates, there will be no conflict with the criteria laid down by the President for appointment to the post of Commander. The absence of the word seniority in the letter of dated October 20, 1986 does not exclude the right to prior consideration flowing from being the senior-most officer entitled to the considered in terms of Articles 14 and 16 of the Constitution. The expression fitness in all respects or merit or suitability is not synonymous. It was submitted on behalf of respondent No.1 that an Commander having experience of operations during war and extensive counter insurgency may be more suitable for commanding the rather than for an equivalent staff post at the and vice versa and that even the highest post in any organisation need not be a selection post to be filled on the basis of comparative assessment of merit of eligible officers. ", " further elaborated that the post of Commander, even if it is assumed, is selection post to be filled up on the basis of comparative assessment of relative merit of officers, the field of choice cannot be restricted to two persons only and there were as many as nine Lt. Generals eligible for consideration having had a residual service of two years and put in at least one year as Commander including respondent No.1 and respondent No.2. Admittedly seven out of nine officers were not considered. The criteria adopted by the appellants are not that of selection or assessment of relative suitability of officers. According to , the expression relative suitability of the officer does not mean the comparative assessment of merit. It means suitability for the particular command or the particular staff appointment as the case may be and that suitability is related to the command in question or the staff appointment in question and there is no mention of any comparative assessment of merit even in that circular. Even that circular does not itself lay down the two senior eligible officers should be considered for each Commanders vacancy. In refers to a pre- existing requirement without mentioning any letter or circular. No such document containing this requirement has been produced so far. The so-called assessment of merit of respondent Nos.1 and 2 in the instant case does not reveal all the facts or take into consideration all the necessary facts that are required to be taken note of. There are several factors available on record such as Annexures 1, 2 and 3 of his representation to the Attorney General and Annexure C to the written submissions which will clearly indicate that the has not taken note of all the factors in making the appointment in question. submitted that advisory remarks are not adverse remarks and they cannot be relied upon for denying the promotion to an officer declared fit for promotion in all respects for that very post and that the reports which are too stale and remote cannot be dug up to change the settled inter se merit of officers assessed by as many as five selection boards for successive promotions from the ranks of Major to the rank of Lt. General all of which are selection posts. Advisory remarks of the Reviewing Officer in the CR of respondent No.1 for 1971 were never communicated to respondent No.1 and, therefore, the same could not be relied upon against him. Another submission that has been made by is that consent to go on deputation cannot take away the right to be considered for promotion and if selected for promotion and that the policy regarding willingness certificate cannot in any event hold good beyond the normal tenure of three years of officers sent on foreign assignments in public interest and if the post of Commander is a non-selection post to which appointment has to be made on the basis of seniority subject to fitness in all respects and fulfillment of both these criteria having already been held in his favour by the Chief of the Staff, was justified in issuing the writ. ", "The matter put before this Court in the light of the arguments advanced on behalf of the parties and the pleadings raised or the findings recorded by , we have to consider the same from five facets of the case: ", "[i] Whether the Army Commander holds a selection post or one which is based on seniority but the officer should be fit in every respect for such appointment and should have a minimum of two years before retirement from the date of appointment as Army Commander/VCOAS? ", "[ii] Whether the instructions given on October 16, 1992 are executive instructions not supportable in law which stipulate that an officer to be eligible to the post of Corps Commander should either be eligible to become an Army Commander or should have a minimum of four years residual service on the date he is promoted to the rank of Lt. General and should have commanded a Corps for at least one year? ", "[iii] What is the effect of the ACRs recorded by the Chief of the Army Staff? ", "[iv] What is the effect of waiver granted to Lt. General R.S. Kadyan when he was a Brigadier serving in the Embassy of France? ", "[v] Whether the Cabinet Secretary is justified in taking into consideration the service profiles of Lt. General and Lt. General in making his recommendations? ", "Several decisions have been cited before us on either side by the learned counsel appearing in this case but we are not adverting to the same since we are not in any way detracting from the principles stated therein nor are we enunciating any new principle. Moreover, we are deciding on the special features arising in this case. ", "On October 20, 1986 criteria of appointment of Army Commander was issued purported to be under the orders of the President of India and such criteria is as follows :- ", "(a) The officer should be fit in every respect for appointment; and ", "(b) The officer should have a minimum of two years left before the retirement age from the date of appointment as Commander/VCOAS. ", "(c) This will be applicable w.e.f. 1.1.1988 ", "(d) As a one time exception, the pay but not the status of an Commander will be given to those General officers, presently holding the rank of Lt. Gen., who are otherwise found fit to hold the appointment but are not selected because of the revision in the criteria. ", "(e) The officer should have commanded a for at least one year so as to become eligible for appointment as Commander/VCOAS. No waiver in this stipulation will be allowed without prior concurrence of the Government. [added on November 18, 1996 pursuant to letter No. 19(24)/96/D(MS) issued by , .] (Emphasis supplied) On the basis of this letter the argument advanced before us is that the appointment to the post of Commander is of selection and not a mere promotion on the basis of seniority. It is urged on behalf of and Lt. General is that the post of Commander is a selection post and not a post merely based on seniority. While , learned senior Advocate for the contesting respondents, submitted that what is required in this letter is only that a concerned officer should be fit in every respect and should have fulfilled the other requirements. Though diametrically opposite views are stated, on a careful reading of this letter it becomes clear that an officer should be fit in every respect for such appointment will not merely mean that he must be physically fit or mentally fit but in every other respect. In addition, in clause (d) above in the letter while making certain exceptions what was in the mind of the authority is made clear that an officer holding the rank of Lt. General who is otherwise fit but not selected because of the revision of criteria will be a clear indication that it is a selection and not a mere promotion on the basis of seniority. Further, the expression fit has been brought to our notice as legally meaning fit to be chosen by elaborating the expression eligible in Strouds Judicial Dictionary, 5th Edn. However, the expression fit, which has different shades of meanings, also means a person to be appointed shall be legally eligible and eligible has already been explained by us to mean fit to be chosen. Again, the expression select means chosen or picked up. Therefore, we are of the view that to the post of Commander, selection has to take place. Of course, considering the nature of rigorous standards adopted in the matter of selection of officers from the stage of Lt. Colonel onwards upto the stage of Lt. General in the usual course it may be that the senior most officer is selected as the Commander. But that does not debar the Chief of the Staff or in making the selection of any other person for good reasons who fulfills the necessary criteria. Therefore, we are of the opinion that it was improper on the part of to have concluded that the post of Commander is a non-selection post. Further, the conclusion reached by that appointment to the post of Commander has to be made on the basis of seniority alone cannot be accepted. ", "The next question, which we have to consider, is what is the nature of the executive instructions that have been given. Even if we accept the view taken by that communication in this regard merely amounted to an executive instruction and not supported by any orders made by the President of India or , the learned Attorney General submitted that the other parameters that are clearly laid down in the letters of should be strictly followed, that is, all officers who are likely to be eligible for an Commander appointment in terms of two years residual service will have to be given command of a and unless such officer has commanded the for at least one year he cannot be considered for promotion. In the present case, respondent No.1 became a Commander on September 24, 1997 and the vacancy in the post of Commander arose on March 1, 1998 and thus he had not completed one year of experience as a Commander and he had put in 5 months and 7 days experience and to this if we add the waiver granted by the Government in terms of 6 months, it will only be 11 months and 7 days experience. Even so, he falls outside the zone of consideration for being appointed as an Commander. However, much argument was addressed on the effect of the recommendation made by the Chief of the Staff and the order made by in that regard. On November 6, 1998 the Chief of the Staff recorded a note in the following terms :- In view of the above, I recommend that redress be granted to tbe Gen officer by way of granting 6 months AE waiver to him for consideration for promotion to the appointment of Cdr/VCOAS for a vacancy occurring on 01 Mar 98. ", "The argument addressed is that the waiver granted by the Government is identical with the consideration of his case for appointment as Commander inasmuch as waiver has been granted for the purpose of considering his case to the post of Commander it is contended that his case should have been considered. We fail to appreciate this line of argument. The basis upon which proceeded is that having taken all the issues into consideration the respondents have taken a stand totally contrary to the recommendations of the Chief of the Staff as well as . The absence of the concerned officer from India on an assignment in the Embassy of France, the waiver granted only for a period of six months and other various factors taken into account are also set out in the following terms :- ", "In view of the above detailed examination of the case, is of the view that Lt. Gen , VSM, be granted waiver of six months in tenure of and considered for the appointment of as the Gen Offr is not completing AE criteria due to :- ", "(a) Delayed repatriation from France resulting in - ", "(b) Delayed placement on criteria appointment in the rank of Maj Gen. ", "(c) Delayed consideration for promotion to the rank of Lt Gen and ", "(d) Revision of FIT grading to Deferred, which resulted in ", "(e) Further delay in consideration, approval and placement as , and ", "(f) Application of new clause vide MOD letter of 18 Nov. 96, the provisions of which only exclude him in 1962 batch vis-\u00e0-vis his batchmates. ", "All the above events were beyond the control of the complainant and were basically caused by the administrative constraints of the organisation. Hence, the Gen Offr deserves the benefit of grant of waiver in terms of natural justice and equal rights, clause of the law. ", "But whatever may be the circumstances or the period for which he fell short the waiver granted is only for a period of 6 months. If that is so, respondent No.1 cannot be said to have completed the period of one year of experience as Corps Commander. Further, Lt. General was considered by and found fit on April 10, 1997 but he could not be promoted as Lt. General and appointed as Corps Commander because of stay order passed by in the writ petition filed by Lt. General . The said order was vacated and thereafter Lt. General was promoted on September 24, 1997 and he functioned as with effect from August 23, 1997 without any effect on promotion, pay or any related benefits till he was actually promoted on September 24, 1997. Lt. General was appointed as after the stay was vacated on September 24, 1997. Hence that period including the period of waiver falls short of the requisite period of two years. ", "On 5.10.97, respondent No.1 made a statutory complaint that his case should be considered on the basis of merit-cum-seniority subject to being found fit for promotion and ultimately prayed for the following : ", "(1) The decision to defer his case in connection with the selection board met on October 31, 1996 may be reviewed and if he is deemed to have been placed in command of a corps retrospectively from the date of declaration of the results of . ", "(2) In the alternative, he prayed that the stipulation of commanding of a corps for minimum one year to become eligible for appointment as an Commander under the letter dated November 18, 1996 may be waived in his case as the delay in his promotion seems to have been caused entirely in the interest of service. ", "The Chief of Army Staff recommended waiver of this stipulation contained in the letter dated November 18, 1996 limiting to a period of six months. Therefore, the conclusion of that he became eligible to be considered to the higher post does not seem to be valid nor was justified in proceeding on that basis. The conclusion of to that extent is erroneous. ", "The ACR for the period 1.10.1997 to 31.1.1998 is to the effect that he considered him fit in every way to hold his present rank and also to the next higher rank. On this basis, it is contended that the Chief of the Army Staff having recommended his case in the ACR as fit for promotion could not alter the same subsequently and give a finding that such a recommendation in ACR will have a limited effect. The position in law is that appraisal report or an annual confidential report is not the sole factor to be considered by the selection authority but one of the matters to be taken note of by such authority. We may advert to two decisions of this Court in this regard, namely, , 1993 (Supp.) 4 SCC 441 and , 1996 (10) SCC 555. Therefore, we are of the view that heavy reliance placed by on the ACRs to reach the conclusion otherwise is not justified. In deciding whether a post is a selection post or not, one of the criteria to be considered is if it involves a comparative assessment of officers necessarily the element of selection is involved and, therefore, the post with which we are concerned is indeed a selection post although not totally ignoring a senior. ", "In raising an argument that respondent No.1 being the senior-most officer in the cadre was being considered for the next higher post. The post in question being a selection post for purposes of promotion, the contention advanced is that all the eligible candidates in that cadre should have been considered and consideration of only two candidates, namely, the appellant in one of the cases and respondent No.1, alone could not meet the necessary criteria. This contention does not also hold water because no one else has made a complaint and the case of respondent No.1 has been duly considered. Thus the argument advanced by on this aspect does not stand to reason. ", "Now we come to the last aspect of the matter, namely, the manner in which the Secretary examined the service profiles of the two officers in question. For purposes of convenience, we may set out the relevant portion of the note: ", "Lt. Gen. He was commissioned in the Rajputana rifles regiment of the in June, 1962 and has held various , Staff and Instructional appointments. He picked up the rank of Lt. Gen. On 24th September, 1997 and started functioning as regular Corps er. The General Officer has a balance exposure in , Staff and Instructional appointments. However, his staff experience in senior ranks from Brig. onwards is only limited to that of Military Attachee. He has no experience of working in Northern and . Since 1980 he has worked for about 4 years in field areas. It also appears from his records that he did not participate in 1962, 1965 operations. In his report of 1971, when he participates in the operations, there are some advisory remarks both by the IO and RO as below:- ", "should be bold and aggressive in operation . Should lead his mean personally to difficult objectives. (Remarks by ). ", ".. his performance as a Rifle Coy Commander in the recent operations has been satisfactory though not upto the expected level. (Remarks by RO). ", "The overall profile of the officer, especially in senior ranks has been clearly above average. All the reporting officers gave him above average ratings with sprinkling of outstanding ratings. ", "As regards CI operations, the officer has handled the same as , , but he has not had experience of commanding a regular Division. His experience as Corps Commander is also limited. He is a graduate of and has also done higher command courses. He is recipient of Chiefs Commendation, VSM and AVSM. He is medical category SHAPE- 1. ", "Lt. Gen : - He was commissioner in in June, 1962. He became Lt. Gen in Feb, 1996 and since then he is commanding the Eastern Sector. The general officer has rich experience in and Staff appointments. He has worked both in Eastern and Northern s including high altitude areas. Since 1982 he has worked for about 4 years in remote field areas in the Eastern Sector, especially the border areas with China. He has also held important staff assignments in Military Operations, Infantry and Staff Duties, Directorates in . His instructional experience is however limited to junior ranks only and he has practically no experience of CI operations. ", "The officer did not participate in 1962 and 1965 operations. His report of 1971, the year in which operations took place is quite laudatory. The overall profile of the officer, especially in senior ranks has been clearly above average. All reporting officers have given him above average ratings with sprinklings of outstanding ratings. He is a graduate of and has also done Senior Commands and NDS Courses. He is also a recipient of AVSM. He is medical category SHAPE-1. ", "The contention put forth before us is that there are factual inaccuracies in the statement recorded by the Cabinet Secretary in his note and, therefore, must be deemed to be vitiated so as to reach a conclusion that the decision of the in this regard is not based on proper material. The learned Attorney General, therefore, took great pains to bring the entire records relating to the relevant period which was considered by the Cabinet Secretary and sought to point out that there were notings available on those files which justify these remarks. Prima facie, we cannot say, having gone through those records, that these notings are baseless. Critical analysis or appraisal of the file by the may neither be conducive to the interests of the officers concerned or for the morale of the entire force. May be one may emphasize one aspect rather than the other but in the appraisal of the total profile, the entire service profile has been taken care of by the authorities concerned and we cannot substitute our view to that of the authorities. It is a well-known principle of administrative law that when relevant considerations have been taken note of and irrelevant aspects have been eschewed from consideration and that no relevant aspect has been ignored and the administrative decisions has nexus to the facts on record, the same cannot be attacked on merits. Judicial review is permissible only to the extent of finding whether process in reaching decision has been observed correctly and not the decision as such. In that view of the matter, we think there is no justification for the High to have interfered with the order made by the . ", "Before parting with the case we need to observe that considering the nature of the sensitivity of the posts involved and that each of the officer feeling that he did not get the best of the deal at the hands of the or that the members of the force being aware who is the best is not heading them will certainly weaken the esteem and morale of the force. Therefore, the standards to be adopted and applied should be of the highest order so as to avoid such an impression in the force. ", "In the result, we allow the appeals filed by and Lt. Gen. and set aside the orders made by and dismiss the writ petition filed by respondent No.1."], "relevant_candidates": ["0000987723", "0001643976", "0001906655"]} {"id": "0000781949", "text": ["CASE NO.: Appeal (civil) 5077 of 1998 PETITIONER: and . RESPONDENT: DATE OF JUDGMENT: 28/01/2003 BENCH: , & . JUDGMENT: ", "JUDGMENT As regards applicability of Section 5 of the Limitation Act, 1963 in the matter of default in deposit of rent as also interpretation of the word 'shall' occurring in the Rajasthan Premises (Control of Rent & Eviction) Act , 1950 (hereinafter referred to 'the Act', for the sake of brevity), of this Court by an order dated 21.3.2002 referred the matter to a three Judge Bench observing : ", "\"Looking to the importance of the questions and the conflicting views taken in the judgments of this Court, we deem it proper that the case is heard by a Bench of three Judges.\" ", "That is how the matter is before us. ", "Before adverting to the aforementioned questions, the factual matrix involved in the matter may be noticed. The appellant herein is the landlord in respect of the suit premises and the respondent is a tenant therein. Allegedly, the respondent did not pay rent for the period 1.8.1986 to 31.1.1987 wherefor upon service of the legal notice, a suit for possession and arrears of rent was filed which was marked as Civil Suit No.824 of 1993. ", "The learned Trial Judge in terms of the provisions contained in Section 13(3) of the Act determined the provisional rent @ Rs.80/- per month and by an order dated 9.9.1991 directed the respondent to deposit the arrears as also current rent in court. Admittedly, the respondent did not deposit the same within the period specified therein. The appellant herein filed an application purported to be under Section 13(5) of the Act; whereafter on or about 9.11.1993 the respondent filed an application for condonation of delay. By reason of an order dated 20.1.1994, the said application for condonation of delay was dismissed, inter alia, on the ground that the same was not filed within time. A revision application was thereafter filed by the respondent questioning the legality or validity of the said order, inter alia, on the ground that there is no law barring filing of an application for condonation of delay after expiry of the period specified for deposit of rent. ", "It appears that a Full Bench of in [AIR 1983 Raj. 222] had held that an application under Section 5 of the Limitation Act in the matter of deposit of rent in terms of Section 13(4) of the Act was maintainable. The said decision was rendered having regard to Rajasthan Premises (Control of Rent & Eviction) (Amendment) Act , 1975, in terms whereof Section 13-A was inserted whereby and whereunder the court was obligated to determine the amount of arrears of rent up to the date of the order as also the amount of interest thereon at the rate of 6% per annum and cost of the suit allowable to the landlord and direct the tenant to pay the amount so determined within such time, not exceeding ninety days as may be fixed by the court and on such payment being made within the time fixed as aforesaid, the proceedings were to be disposed of as if the tenant has not committed any default. ", "A learned Single Judge of at the hearing of the revision application filed by the respondent was, however, of the view that as in case (supra) was concerned with interpretation of Section 13-A(b) of the Act; the question as regards applicability of Section 5 of the Limitation Act in the matter arising under Section 13(4) of the said Act requires consideration by a larger Bench. The learned Single Judge was further of the view that the decision of in case (supra) required reconsideration also on the question as to whether the court has any power to extend the time beyond the period prescribed under Section 13(4) of the Act having regard to the fact that the said decision based on various judgments of this Court relating to different Rent Control statutes of various States which were not in pari materia with the provisions of the Act. ", "Pursuant to or in furtherance of the said observations of the learned single Judge, of five Judges was constituted. By reason of the impugned judgment dated 17.12.1997, three Hon'ble Judges of held that Section 5 of the Limitation Act is applicable where there is default in deposit of arrears of rent within specified period whereas two other members of the Bench held to the contrary. ", " was further of the view that since the applicability of the Indian Limitation Act , 1963 is not expressly excluded by reason of the provisions of the Act, Section 5 of the Limitation Act, 1963 would be applicable in a case where the tenant could not deposit the rent within the time pursuant to the order passed under Section 13(3) of the Act. also held that the word \"shall\" has to be interpreted as \"may\" and it is in the discretion of the Court to condone the delay in default of payment/ deposit of rent within specified period. ", "In that view of the matter, the order rejecting the application under Section 5 of the Limitation Act was set aside and the revision petition filed by the respondent was allowed. It is against the said judgment, the appellants have preferred this appeal. ", "Two questions which arise for our consideration are, firstly, that whether the matter stands covered by the decision of this Court in M/s. B.P. Khemka Pvt. Ltd. Vs. and . [(1987) 2 SCC 407]; and, secondly, whether the provisions of Section 5 of the Limitation Act, 1963 is applicable where there is a default in depositing the rent within stipulated time by the tenant. ", "Section 13(1)(a) of the Act enables a landlord to sue for a decree of eviction in the event a tenant has neither paid nor tendered the amount of rent due from him for six months. In terms of sub-section (3) of Section 13 which was substituted by Section 8(i) of the Rajasthan Act No.14 of 1976 it is obligatory on the court to provisionally determine the amount of rent wherefor no application is required to be filed. Sub-sections (4) and (5) of the said Act which are relevant for this appeal read thus :- ", "\"(4) The tenant shall deposit in court or pay to the landlord the amount determined by the court under sub-section (3) within fifteen days from the date of such determination, or within such further time, not exceeding three months, as may be extended by the court. The tenant shall also continue to deposit in court or pay to the landlord, month by month, the monthly rent subsequent to the period up to which determination has been made, by the fifteenth of each succeeding month or within such further time not exceeding fifteen days, as may be extended by the court, at the monthly rate at which the rent was determined by the court under sub-section (3). ", "(5). If a tenant fails to deposit or pay any amount referred to in sub-section (4), on the date or within the time specified therein, the court shall order the defence against eviction to be struck out and shall proceed with the hearing of the suit.\" ", "A bare perusal of the aforementioned provisions would show that in terms of sub-section (4) of Section 13 , a tenant is required to deposit the amount of rent determined by the under sub-section (3) within fifteen days of the date of determination or within such further time not exceeding three months, as may be extended by the court. ", "It is not in dispute that by reason of 1976 Amendment, the following was specifically inserted :- ", "\"Within such further time not exceeding 3 months as may be extended by the or the words\" or within such further time not exceeding 15 days as may be extended by the , at the monthly rate at which the rent was determined by the under sub-section (3)\" ", "The word 'shall', which is ordinarily imperative in nature, has been used in sub-section (4) of Section 13 . The power of the court has also been limited to the extent that it can extend time for such deposit not exceeding three months and so far as the deposit of monthly rent is concerned, by fifteen days. The court's power, therefore, is restricted. In case tenant deposits the provisional rent as determined by the within stipulated period the tenant is relieved by the eviction decree. ", "In the aforementioned backdrop, the decision of this in M/s 's case (supra) may be noticed. ", "M/s. B.P. Khemka (supra) arose out of the West Bengal Premises Tenancy Act, 1956 (in short 'the West Bengal Act '). In the said case the tenant committed default in payment of arrears of rent and the landlord brought a suit for eviction on the ground of default. While the suit was pending, the West Bengal Premises Tenancy (Amendment) Ordinance No. 6 of 1967, which was replaced by the West Bengal Premises Tenancy (Amendment) Act 30 of 1969 came to be promulgated with effect from August 26, 1967. The Act gave a retrospective effect to the amendments by providing that the amendments made by Section 2 of the Ordinance shall have effect in respect of all suits including appeals which were pending at the date of commencement of the Ordinance. The amendments inter alia enabled tenants who were in default to apply to the court and pay the arrears of rent in instalments and thereby avert their eviction. In pursuance thereof, the tenant deposited the rent. However, he subsequently committed default in paying monthly rent. Consequently, the defence was struck off on the ground that in paying the rent for the months of September, 1968 and March 1969, there had been a delay of 44 days and 6 days respectively, which was in contravention of Section 17(1) of the West Bengal Act. ", "In this context sub-sections (2A), (2B), (3) and (4) of Section 17 of the West Bengal Act may be noticed which read as under: ", "\"(2A) Notwithstanding anything contained in sub- section (1) or sub-section (2) on the application of the tenant the court, may, by order : ", "(a) extend the time specified in sub-section (1) or sub-section (2) for the deposit or payment of any amount referred to therein. ", "(b) xxx xxx xxx xxx (2B) No application for extension of time for the deposit or payment of any amount under clause (a) of sub-section (2A) shall be entertained unless it is made before the expiry of the time specified therefor in sub-section (1) or sub-section (2);\" ", "\"(3) If a tenant fails to deposit, or pay any amount referred to in sub-section (1) or sub- section (2) within the time specified therein or within such extended time as may be allowed under clause (a) of sub-section (2-A), or fails to deposit or pay any instalment permitted under clause (b) of sub-section (2-A) within the time fixed therefor, the court shall order the defence against delivery of possession to be struck out and shall proceed with the hearing of the suit. ", "(4) If a tenant makes deposit or payment as required by sub-section (1), sub-section (2), or sub-section (2-A) no decree or order for delivery of possession of the premises to the landlord on the ground of default in payment of rent by the tenant shall be made by the court but the court may allow such costs as it may deem fit to the landlord.\" ", "This in M/s. B.P. Khemka's case (supra) while interpreting the provisions of sub-section (4) held that the proviso makes it clear that if the subsequent default is for a period of 4 months within a period of 12 months, the tenant can claim relief under the sub-section once again. Since the default was less than 40 days, this held that under the said proviso, the delay could be condoned. ", "In terms of clause (a) of sub-section (2A) of Section 17 of the West Bengal Premises Tenancy Act, 1956 requisite power to extend the time for deposit of rent on an application made by the tenant is conferred in the court in relation whereto there does not exist any restriction. ", "It is beyond any cavil that the question as to whether the provision is directory or mandatory would depend upon the language employed therein. [ [AIR 1990 SC 981 = (1989) Suppl. 2 SCR 336]. ", "This Court in . [2002 (9) SCALE 102], has observed :- ", "\"Scope of the legislation on the intention of the legislature cannot be enlarged when the language of the provision is plain and unambiguous. In other words statutory enactments must ordinarily be construed according to its plain meaning and no words shall be added, altered or modified unless it is plainly necessary to do so to prevent a provision from being unintelligible, absurd, unreasonable, unworkable or totally irreconcilable with the rest of the statute\" ", "[See also . (2002 (9) SCALE 778]. ", "It is also a well-settled principle of law that the decision on an interpretation of one statute can be followed while interpreting another provided both the statutes are in pari materia and they deal with identical scheme. ", " relied upon the following decisions dealing with respectively with the Rent Control Acts of the different States: ", "i) AIR 1980 SC 587 : 1980 (2) SCC 151 dealing with the M.P. ", "Accommodation Control Act, ", "ii) AIR 1980 SC 1664 : 1980 (3) SCC 610 Miss Santosh Mehta Vs. and Ors. dealing with the Delhi Rent Control Act . ", "iii) AIR 1984 SC 1932 : 1984 (3) SCC 111 Ram Murti Vs. and . dealing with the Delhi Rent Control Act . ", "iv) AIR 1985 SC 964 : 1985 (3) SCC 53 Vs. dealing with the Bihar Building. ", "v) AIR 1987 SC 1010 : 1987 (2) SCC 407 B.P. Khemka Pvt. Ltd. Vs. and . dealing with West Bengal Premises Tenancy Act. ", "The question, therefore, which would arise for our consideration is as to whether the respective State Act s on the basis whereupon the impugned judgments of this Court had been rendered are analogous to the provisions of the Act or not. ", "In vs. [AIR 1980 SC 587 : (1980) 2 SCC 151], the provisions of the M.P. Accommodation Control Act, 1961 (hereinafter referred to as \"the M.P. Act \") was in question. Sub-sections (1) and (6) of Section 13 thereof are as follows : ", "\"(1) On a suit or proceeding being instituted the landlord on any of the ground referred to in section 12 , the tenant shall, within one month of the service of summons on him or within such further time as the court may, on an application made to it, allow in this behalf, deposit in the court to pay to the landlord an amount calculated at the rate of rent at which it was paid for which the rent may have made default including the period subsequent thereto up to the end of the month previous to that in which the deposit or payment is made; and shall thereafter continue to deposit or pay, month by month, by the 15th of each succeeding month a sum equivalent to the rent at that rate. ", "(6) If the tenant fails to deposit or pay any amount as required by this section the court may order the defence against eviction to be struck out an shall proceed with the hearing of the suit.\" ", "(Emphasis mine) A bare perusal of the said provisions would clearly go to show that by reason of the provisions of Section 13(1) of the M.P. Act, the has been conferred power to extend the time for deposit of rent to any such further time, as it may, on an application made to it, allow in this behalf. The power of the court under the M.P. Act is not restricted. However, discretion available to the court under the Rajasthan Act, as noticed hereinbefore is limited. Furthermore, in sub-section (6) of Section 13 of the M.P. Act, the word 'may' has been used which is directory; in contra-distinction with the word 'shall' employed in the Rajasthan Act. ", "The M.P. Act provides for the power of the court to extend the time in the event sufficient cause therefor is shown which is absent in the Rajasthan Act. Furthermore, in terms thereof once the rent has been determined, the same has to be deposited within the prescribed period wherefor there exists no provision for filing an application. ", " . [1980 (3) SCR 325 : ] and vs. Bholanath and Others [AIR 1984 SC 1392 : ], this Court was concerned with the provision of Section 15 of the Delhi Rent Control Act, 1958 which is in the following term : ", "(1) In any proceeding for the recovery of possession of any premises on the ground specified in clause (a) of the proviso to sub-section (1) of section 14 , the controller shall after giving the parties an opportunity of being heard, make an order directing the tenant to pay to the landlord or deposit with the controller within one month of the date of the order, an amount calculated at the rate of rent at which it was ast paid for the period for which the arrears of rent were legally recoverable from the tenant including the period subsequent thereto up to the end of the month previous to that in which payment or deposit is made and to continue to pay or deposit, month by month by the 15th of each succeeding month a sum equivalent to the rate of rent. ", "(3) If in any proceedings referred to in subsection (1) or subsection (2), there is any dispute as to the amount of rent payable by the tenant, the Controller shall, within fifteen days of the date of first hearing of the proceedings fix an interim rent in relation to the premises to be paid or deposited in accordance with the provisions of subsection (1) or subsection (2), as the case may be, until the standard rent in relation thereto is fixed having regard to the provisions of this act, and the amount of arrears, if any, calculated on the basis of standard rent shall be paid or deposited by the tenant within one month of the date on such further time as the Controller may allow in this behalf. ", "(7) If the tenant fails to deposit or pay any amount as required by this section the court may order the defence against eviction to be struck out and shall proceed with the hearing of the application.\" ", "(Emphasis mine) Yet again Section 15 of the Delhi Rent Control Act confers power upon the court to extend the time for deposit of rent to any such period, as it may in this behalf deem fit. Furthermore, even in sub-section (7) of Section 15 the word 'may' has been used. We may notice that under sub-section (5) of Section 13 of the old Act the word 'shall' has been used and construing the said provision, this Court in [AIR 1964 SC 1317], noticed : ", "\".the change of words from \"the court shall order the defence against ejectment to be struck out\" to the words \"the controller may order the defence against eviction to be stuck out\" is clearly deliberate modification in law in favour of the tenant. Under the old act the court had no option but to strike out the defence if failure to pay or deposit the rent is proved; under the new act the controller who takes the place of the court has a discretion in the matter; so that in proper cases he may refuse to strike out the defence.\" ", "(Emphasis mine) [1985 (3) SCR 825 : ], this Court was concerned with interpretation of Section 11-A of the Bihar Buildings (Lease Rent and Eviction) Control Act, 1947 (hereinafter referred to ' Bihar Act of 1947') which was in the following term : ", "\"11-A. Deposit of rent by tenants in suits for ejectment If in a suit for recovery of possession the tenant contests the suit, as regards claim for ejectment, the landlord may make an application at any stage of the suit for order on the tenant to deposit month by month rent at a rate at which it was last paid and also the arrears of rent, if any; and the court, after giving an opportunity to the parties to be heard, may make an order for deposit of rent at such rate as may be determined month by month and the arrears of rent, if any, and on failure of the tenant to deposit the arrears of rent within fifteen days of the date of the order or the rent at such rate for any month by the fifteenth day of the next following month, the court shall order the defence against ejectment to be struck out and the tenant to be placed in the same position as if he had not defended the claim to ejectment. The landlord may also apply for permission to withdraw the deposited rent without prejudice to his right to claim decree for ejectment and the court may permit him to do so. The court may further order the recovery of cost of suit and such other compensation as may be determined by it from the tenant.\" ", "The said provision of the Bihar Act of 1947 did not contain any negative provision as is there in the present Act. Furthermore, even under the said provision an application was required to be filed which is not the case in this appeal. For that reasons the decision in Ganesh Prasad Sah Kesri (supra) is distinguishable and has no application to the present case. ", "We may further notice that in Vs. [(2002) 3 SCC 617], which also arose out of the West Bengal Premises Tenancy Act, it was held that under sub-section (2A) of Section 17 of the Act, the has a power to extend the period for depositing the rent in the event of default by the tenant to deposit the rent within a stipulated time. This further held that if a has no power to extend the time, then in cases of small default beyond the reason of the tenant, the time cannot be extended. ", "(Emphasis mine) It is interesting to note that in [1978 (3) SCR 198 : 1978 (2) SCC 573], this Court while interpreting similar provisions occurring in Section 12(3)(a) of the Bombay Rent, Hotel, Lodging Houses Rates Control Act, 1947 (hereinafter referred to as \"the Bombay Rent Act\") held : ", "\" Section 12(3)(b) does not create any discretionary jurisdiction in the , it provides protection to the tenant on certain conditions and these conditions have to be strictly observed by the tenant who seeks the benefit of the section. If the statutory provisions do not go far enough to relieve the hardship of the tenant the remedy lies with the legislature, it is not in the hands of the .\" ", "Thus under the Bombay Rent Act only on certain grounds the can exercise its discretionary power and not on other grounds. ", "Yet again in [AIR 1988 SC 602], this Court interpreting the provision of Section 15 of the Bihar Buildings (Lease, Rent and Eviction) Control Ordinance 1982 being Ordinance No.63 of 1982 (hereinafter referred to as 'the Bihar Rent Ordinance, 1982'), held : ", "\" Section 13 of the Act stipulates that if in a suit for recovery of possession of any building the tenant contests the suit as regards the claim for ejectment, the landlord may move an application at any stage of the suit for an order on the tenant to deposit rent month by month at the rate at which it was last paid and also subject to the law of limitation, the arrears of rent, if any, and the court after giving an opportunity to the parties to be heard may make an order to deposit the rent month by month at such rates as to be determined and the arrears, both before and after the institution of the suit, if any, and thereafter provides \"on failure of the tenant to deposit the arrears of rent within 15 days of the next following month the court shall order the defence against the ejectment to be struck off\". Therefore, there is a duty cast on the court to strike out the defence if there is a failure of the tenant to deposit arrears of rent within 15 days. In this case, both the trial court as well as have found that there was, in fact, a delay to pay the arrears of rent within 15 days. In that view of the matter it is not possible to interference with the order of .\" ", "In the said case there was delay of about four to five days in depositing the rent allegedly on the ground of bank strike but the defence against the eviction was struck off. ", "In a case where the statutory provision is plain and unambiguous, the court shall not interpret the same in a different manner, only because of harsh consequences arising therefrom. ) by Lrs. and Others [], of this Court observed : ", "\".The rent legislation is normally intended for the benefit of the tenants. At the same time, it is well settled that the benefits conferred on the tenants through the relevant statutes can be enjoyed only on the basis of strict compliance with the statutory provisions. Equitable consideration has no place in such matters\" ", "It is also pertinent to note that the Rent Control Act is a welfare legislation not entirely beneficial enactment for the tenant but also for the benefit of landlord. [See: vs. (Smt.) and Others [(1994) 2 SCC 671]. In that view of the matter, balance has to be struck while interpreting the provisions of the Rent Act . ", "The court's jurisdiction to interpret a statute can be invoked when the same is ambiguous. It is well known that in a given case the can iron out the fabric but it cannot change the texture of the fabric. It cannot enlarge the scope of legislation or intention when the language of provision is plain and unambiguous. It cannot add or subtract words to a statute or read something into it which is not there. It cannot re-write or recast legislation. It is also necessary to determine that there exists a presumption that the legislature has not used any superfluous words. It is well-settled that the real intention of the legislation must be gathered from the language used. It may be true that use of the expression 'shall or may' is not decisive for arriving at a finding as to whether statute is directory or mandatory. But the intention of the legislature must be found out from the scheme of the Act. It is also equally well-settled that when negative words are used the courts will presume that the intention of the legislature was that the provisions are mandatory in character. ", "Yet there is another aspect of the matter which cannot be lost sight of. It is a well-settled principle that if an act is required to be performed by a private person within a specified time, the same would ordinarily be mandatory but when a public functionary is required to perform a public function within a time-frame, the same will be held to be directory unless the consequences therefor are specified. In Sutherland, Statutory Construction, 3rd edition, Vol.3 at p.107 it is pointed out that a statutory direction to private individuals should generally be considered as mandatory and that the rule is just the opposite to that which obtains with respect to public officers. Again, at p. 109, it is pointed out that often the question as to whether a mandatory or directory construction should be given to a statutory provision may be determined by an expression in the statute itself of the result that shall follow non-compliance with the provision. ", "At p.111 it is stated as follows : ", "\"As a corollary of the rule outlined above, the fact that no consequences of non-compliance are stated in the statute, has been considered as a factor tending towards a directory construction. But this is only an element to be considered, and is by no means conclusive.\" ", "Thus, on analysis of the aforesaid two decisions we find that wherever the special Act provides for extension of time or condonation of default, the possesses the power therefor, but where the statute does not provide either for extension of time or to condone the default in depositing the rent within the stipulated period, the does not have the power to do so. ", "In that view of the matter it must be held that in absence of such provisions in the present Act the did not have the power to either extend the period to deposit the rent or to condone the default in depositing the rent. ", "Coming to the second question, we are of the view that Section 5 of the Limitation Act, 1963 is not applicable where there is a default in depositing the rent by the tenant under Section 13(4) of the Act. ", "It is true that Rajasthan Act does not expressly exclude the application of Limitation Act . But Section 5 in its terms is not applicable to wherever there is a default in depositing the rent by the tenant. ", " Section 5 of the Limitation Act reads thus: ", "\"5. Extension of prescribed period in certain cases. Any appeal or any application, other than an application under any of the provisions of Order XXI of the Code of Civil Procedure, 1908, may be admitted after the prescribed period, if the appellant or the applicant satisfied the court that he had sufficient cause for not preferring the appeal or making the application within such period.\" ", "On perusal of the said Section it is evident that the question of application of Section 5 would arise where any appeal or any application may be admitted after the prescribed period, if the appellant or the applicant satisfies the court that he had sufficient cause for not making the appeal or application within such period. Section 13(4) provides that in a suit for eviction on the ground set forth in clause (a) of sub-section (1), the tenant shall on the first date of hearing or on or before such date, the may on the application fixed in this behalf or within such time the tenant shall deposit in court or pay to the landlord in court as determined under sub- section (3) from the date of such determination or within such further time not exceeding three months as may be extended by the . Thus, sub- section (4) itself provides for limitation of a specific period within which the deposit has to be made, which cannot be exceeding three months as extended by this . ", "The matter may be examined from another angle. The deposit by the tenant within 15 days is not an application within the meaning of Section 5 of the Limitation Act, 1963. Since the deposit does not require any application, therefore, the provisions of Section 5 cannot be extended where the default takes place in complying with an order under sub-section (4) of Section 13 of the Act. ", "The provisions of Section 5 of the Limitation Act must be construed having regard to Section 3 thereof. For filing an application after the expiry of the period prescribed under the Limitation Act or any other special statute a cause of action must arise. Compliance of an order passed by in terms of a statutory provision does not give rise to a cause of action. Failure to comply with an order passed by instant consequences are provided for under the statute. The court can condone the default only when the statute confers such a power on the and not otherwise. In that view of the matter we have no other option but to hold that Section 5 of the Limitation Act, 1963 has no application in the instant case. ", " [AIR 1969 All. 200], V.G. Oak, CJ observed : ", "\"Delay may be condoned if a party makes delay in filing an appeal or moving an application, but no such situation arose in the present case. The petitioner made delay in depositing the admitted tax. The Appeal itself was filed within time. The Assistant Commissioner rightly held that there was no room to give the appellant the benefit of Section 5 of Indian Limitation Act.\" ", ", J.,(as he then was) observed : ", "\" Section 5 is not attracted when the question arises whether the delay in depositing the admitted tax should be condoned. It seems to me that the application made by the Petitioner for condonation of delay in depositing the entire amount of admitted tax is not maintainable under Section 5 of Limitation Act.\" ", " [ 1974 (3) SCR 31 ], P. Jaganmohan Reddy, J. held that Section 5 of the Limitation Act does not govern an election petition. The said decision has been followed in [AIR 1983 Orissa 63]. ", " [AIR 1975 SC 1039 = ], this Court upon referring to various decisions observed : ", "\"Thus the principle that emerges is that if the in a special statute prescribes a certain period of limitation for filing a particular application thereunder and provides in clear terms that such period on sufficient cause being shown, may be extended, in the maximum, only upto a specified time-limit and no further, then the tribunal concerned has no jurisdiction to treat within limitation, an application filed before it beyond such maximum time-limit specified in the statute, by excluding the time spent in prosecuting in good faith and due diligence any prior proceedings on the analogy of Section 14(2) of the Limitation Act.\" ", " [], this Court observed : \" In consequence, by operation of Section 29(2) read with Section 3 of the Limitation Act, limitation stands prescribed as a special law under Section 19 of the Contempt of Courts Act and limitation in filing Letters Patent appeal stands attracted. In consequence, Sections 4 to 24 of the Limitation Act stands attracted to Letters Patent appeal insofar as and to the extent to which they are not expressly excluded either by special or local law. Since the rules made on the appellate side, either for entertaining the appeals under clause 15 of the Letters Patent or appeals arising under the contempt of courts, had not expressly excluded, Section 5 of the Limitation Act becomes applicable. We hold that Section 5 to the Limitation Act does apply to the appeals filed against the order of the learned Single Judge for the enforcement by way of a contempt. , therefore, was not right in holding that Section 5 of the Limitation Act does not apply. The delay stands condoned. Since had not dealt with the matter on merits, we decline of express any opinion on merits. The case stands remitted to the for decision on merits.\" ", "Furthermore, for constituting an application within the meaning of the said provision, there should be some request. [ , 1974 (3) SCR 494 : AIR 1974 SC 968]. ", "Mr. , appearing on behalf of the respondent, however, placed reliance upon a decision of this Court in []. Therein this Court was concerned with extension of period of limitation in a case wherein an appeal was to be preferred before an appellate authority under the Kerala Buildings (Lease and Rent Control) Act, 1965. As for preferring an appeal a period of limitation is prescribed, it was held that Section 5 of the Act was applicable and, therefore, the said decision is of no help to the respondent. ", "Similarly in [(1995) Supp.(4) SCC 578], this Court was concerned with the question as to whether the provision of Section 5 of the Act would be applicable to an appeal filed before the appellate authority functioning under the T.N. Buildings (Lease and Rent Control) Act, 1960. ", "The question which arose for consideration therein was whether the appellate authority was a court or a persona designata. Having regard to the provisions of contained in sub-section (2) of Section 29 , it was held that the Limitation Act ,1963 applies. Such is not the case here and, therefore, the said decision is distinguishable. ", "For the aforesaid reasons, we are of the view that the judgment of cannot be sustained. We, accordingly, set aside the judgment under challenge. ", "The appeal is allowed. There shall be no order as to costs."], "relevant_candidates": ["0000196138", "0000196598", "0000197746", "0000212894", "0000230628", "0000349715", "0000623061", "0000689330", "0000819178", "0000907049", "0000957749", "0001000768", "0001026294", "0001155660", "0001872225", "0001906339", "0001916827", "0156503946", "0181623893"]} {"id": "0000783511", "text": [" . ", "1. has filed this writ petition under Article 226 of the Constitution praying that may be restrained by issuing a writ of prohibition from levying and collecting excise duty on their product, namely, woollen industrial felt under the Central Excises and Salt Act , 1944 (hereinafter referred to as 'the Act'). It was further prayed that the amount of Rs. 7,52,320.55 paise collected by the respondent as excise duty from the petitioner company be ordered to be refunded to the petitioner. ", "2. The petitioner-company manufactures woollen felts at Jaipur. The woollen felts and allied product manufactured by the company, according to the petitioner, are used for industrial purposes, and not for wearing apparels and therefore it does not fall within the expression 'woollen fabrics' as used in Item No. 21 of Schedule I annexed to the Act under which the excise duty is charged. ", "3. According to the averments made by the petitioner-company there is similar factory known as , Baroda producing exactly the similar material. That Mill challenged in the levy and collection of excise duty on their produce and by their judgment in Special Civil Appln. No. 442 of 1967 under Article 226 of the Constitution in the matter of v. held that the woollen felt manufactured by that firm could not be taxed under Item No. 21 of Schedule I to the Act. On the basis of this judgment of the petitioner-company wrote to the excise authorities not to levy and collect the excise duty on the woollen felt produced by it but in spite of its repeated requests made by the petitioner the excise authorities did not agree and continued to levy and collect the excise duty on the product of the petitioner-company. It is under these circumstances that the petitioner has filed this writ petition with the prayer as aforementioned. ", "4. joined issues with the petitioner-company and urged that Item No. 21 of Schedule I to the Act only speaks of the 'woollen fabrics' which, according to the replying respondent, covers the woollen felt. It was also averred that the purpose or use of the woollen felt has no bearing on the levy and collection of the excise duty under the said provision of law. It was denied that the product of the petitioner-company is used for ammunition industry, aviation industry, telephone industry, agriculture industry and for oil filters used in automobile industry, etc. According to the purpose for which the petitioner company is alleged to be manufacturing felt has no bearing whatsoever on their liability for payment of excise duty under Item No. 21 of Schedule I of the Act. ", "5. Mr. argued that 'fabric' is a term which covers all textiles, no matter how manufactured and the nature of the material from which it is made. Felts, according to him, can never fall within the ambit of textiles as the process used by the petitioner-company for manufacturing the woollen felts is different from the process employed for manufacturing the fabrics. The compressed felt sheets manufactured by the petitioner-company, according to Mr. , are quite different from the apparel cloth as it does not stand the course of washing. According to the petitioner, the finished product of the company is obtained by the process of making the compressed woollen felts both with manual labour as well as with the help of two or three imported and also indigenously fabricated machines, and the process of making the compressed woollen felts is just to put the fabrics of the wool symetrically and press it with the help of multi roller using chemicals as well. The felts are manufactured in sheets of various thickness in length and width and are used for industrial purposes. Therefore, in his opinion felt industry cannot be linked with the process of manufacturing woollen fabrics. ", "6. On the other hand, Mr. , appearing on behalf of , relied on the dictionary meaning of the word 'felt' and urged that the word 'fabric' according to the Oxford Dictionary, or Encyclopaedia Britannica, 9th Volume (1969 Edition) and 's Dictionary of Textile Terms, covers felt also, and therefore while interpreting the expression \"woollen fabric\" as used in Item No. 21 of Schedule I of the Act it would not be possible to take the 'Felt' out of the said expression. ", "7. To resolve the controversy whether 'felt' is covered by the word 'fabric', let us first look to the dictionary meaning of these expressions. ", "8. has issued a Glossary of Textile Terms and that Glossary has defined 'felt' as under,-- ", "\"Felt--A textile material characterised by the densely matted condition of most of all the fibres of which it is composed. ", "Note.--Two broad classes of felt can be distinguished (a) materials having a woven fabric structure, and (b) non-woven materials consisting principally of animal fibres, relying for their construction upon the ability of the constituent fibres to meet together to form a composite body with neither wrap or weft\". ", "9. at page 149 has given the meaning of 'felt' as a kind of cloth made by rolling and pressing wool, 'Fibre' has been defined as a substance capable of being spun, woven or felted. The meaning of the word 'fabric' as given in this dictionary is, \"thing put together, woven material, construction and texture tissues.\" ", "10. Encyclopaedia Britannica, 1969 Edition, at page 161 has given the meaning of 'felt' as follows,-- ", "\"Felt, a class of fabrics or fibrous structures obtained through the interlocking of wool, fur or some hair fibres under conditions of heat, moisture and friction. .....\" ", "\"Wool Felt\" has also been described in this very volume at page 228 as \"The wool fibre is covered with a sheath of over-lapping scales arranged like the shingles on a roof.... .... The combination of moisture, heat and mechanical agitation causes the wool fibres to extend and retract. The scales permit the fibres to slide past each other more easily in one direction than in the other. Thus the fibres become progressively entangled to the point where a compact felt, or fulled, fabric results. Felts can be prepared by the direct entanglement of fibres or by first spinning yarns, weaving cloth and then fulling the cloth with hot, soapy water and agitation.\" ", "11. Webster's Third New International Dictionary, Volume I (1966 Edition) at page 836, has defined 'felt' as follows,-- ", "\"a cloth constructed usually of wool and fur fibres often mixed with natural or synthetic fibres by the interlocking of the loose fibres through the action of heat, moisture, chemicals, and pressure without spinning, weaving or knitting.\" ", "The dictionary meaning of the word felt' as given above hardly leaves any room for doubt that the felt is manufactured by the interlocking of the loose fibres by adopting a process as employed by the petitioner-company for manufacturing its product. has described \"felt\" as a class of fabrics or fibrous structure. 'Fabric' has been defined as a cloth of a particular kind. In view of the dictionary meaning of the words 'felt' and 'fibre', there is hardly any room for doubt that the expression 'felt' which is manufactured by fibres is covered by the expression \"woollen fabric\". In this view of the matter, it is difficult for us to accept the contention of Mr. that felt as produced by the petitioner-company will not, in its generic sense, come within the ambit of the expression 'woollen fabric'. ", "12. It was, however, contended by Mr. that 'fabric' is a genus of 'felt', which is only a specie and therefore it cannot be taken out of the application of the term \"woollen fabric\". The demand of the petitioner that its product should be exempt from the levy of the excise duty, therefore according to Mr. cannot be entertained by in the exercise of its jurisdiction under Article 226 of the Constitution. In support of this contention, reliance has been placed by Mr. on authorities in AIR 1964 SC 1519 and 1973 SC 194. ", "13. In 's case AIR 1964 SC 1519, the interpretation of Entry 22 of Part I of the Import Trade Control Hand-book was challenged and it was urged that while exercising its jurisdiction under Article 226 of the Constitution should not interfere with the conclusion reached by the authority under the Act, which on the very face of it appears to be quite reasonable. While dealing with this point learned Judges held that \"a court dealing with a petition under Article 226 is not sitting in appeal over the decision of and therefore the correctness of the conclusion reached by those authorities on the appreciation of the several items in the Hand-book or the Indian Tariff Act which is referred to in these items, is not a matter which falls within the writ jurisdiction of .\" The learned Judges further observed that \"there is, here no complaint of any procedural irregularity of the kind which would invalidate the order, for the order of the Collector shows by its contents that there has been an elaborate investigation and personal hearing accorded before the order now impugned was passed.\" ", "14. In 's case AIR 1973 SC 194, the question that was raised before the was whether the High in the exercise of its extraordinary jurisdiction under Article 226 of the Constitution could interpret the expression used in the Act so as to judge the proper scope of Item No. 74 (vi) of Part V of the I. T. C. Schedule when they have been given proper hearing by the authorities. Their Lordships of the Supreme after reviewing their previous judgments in v. (AIR 1961 SC 1506) and (AIR 1964 SC 1519) observed as follows:-- ", "\"In view of these two decisions of this Court which are binding on us, we have no manner of doubt that was quite right in accepting the conclusions and findings of the authorities about the proper scope of Item 74 (vi) of the I. T. C. Schedule. In our opinion, there is nothing in the decision of the Collector which can warrant its condemnation as perverse or unreasonable. Even if it be assumed that because of the language used in the two items viz. Item 74 (vi) and 74 (x) of the I. T. C. Schedule, there is some room for confusion, it would not be competent for to interfere in a writ petition with the conclusion or findings of the Collector of regarding the scope and ambit of those items.\" ", "15. Relying on the observations of this Court in for Rajasthan 1972 WLN 850 = (AIR 1973 Raj 171) Mr. urged that even if there is possibility of giving a different meaning to a particular item in the Schedule from the one as given by the authorities created under the Act, this Court should adhere to the meaning given by such authorities and should be slow to interfere while exercising its jurisdiction under Article 226 of the Constitution with the verdict given by the authorities. ", "16. While meeting this argument of Mr. , Mr. vehemently urged that in a taxing statute, like the one under consideration, the court should not, as far as possible, enlarge the scope of the Item mentioned in the Schedule by adhering to the dictionary meaning of the expressions or words used by the legislature. According to him, the expression used by the legislature should be given a meaning as it is commonly understood in commercial world. According to Mr. the expression 'woollen fabric' as used in Item No. 21 in Schedule I is understood in common parlance as meaning woollen cloth and woollen textiles; 'felt'. which is never used as textiles, cannot be covered by the words \"woollen fabric\". In support of this argument, reliance has been placed by the learned counsel on the judgment and certain other judgments of and other ; including the decision of the in the case of Gujarat Woollen Mills SCA No. 442 of 1967 (Guj) (supra). ", "17. In the Gujarat case the petitioner used to manufacture felt of the same type which the petitioner-company produces. The judgment of that case resolves the controversy raised in the instant case and it applies to it on all fours. The learned Judges of after considering various decisions of under the provisions of the Sales Tax Act , held that in the light of the practical common sense and in applying the tests laid down by the decided cases referred therein, it is clear that the product manufactured by the petitioner firm for industrial use, though a felt as understood from the technical point of view, is not a woollen fabric as is generally understood in common parlance by persons dealing with this commodity and are well conversant with woollen fabrics in their dealing with this commodity in the course of their trade and business. ", "18. In another Gujarat case: (1965) 16 STG 1059 (Guj), a question arose whether borders woven on handloom out of pure silk, art silk and jari threads are handloom cloth within the moaning of entry 29 in Schedule A of the Bombay Sales-tax Act, 1959. In order to interpret this entry 29 the learned Judges were asked to interpret the word 'cloth' used therein. The argument advanced before the Court was that even a carpet would be covered under the expression 'handloom cloth' but in the technical or technological sense meaning given by a dictionary, a carpet may be a woven fabric but it could never be given a meaning which would bring it within the ambit of the word 'cloth' after consulting various dictionaries. The learned Judges quoted with approval the following para,-- ", "\"The expression 'cloth' has acquired a secondary meaning, that is to say, a meaning attached to that expression in common par-lance by those dealing in and conversant with handloom cloth, and the carpet of the type we have before us would not, in our view, be included in the expression 'handloom cloth of all varieties'.\" ", "After taking into consideration various authorities cited before the , the learned Judges finally held that the word \"cloth\" in entry 29 of Schedule A must be interpreted according to its secondary or popular sense, and not in its primary or technical sense, in which it is commonly understood in ordinary parlance. In ordinary parlance border cannot be regarded as cloth. ", "19. in = (AIR 1974 SC 1362) laid down a principle to interpret the taxing statute and observed while deciding a question whether paddy and rice are identical goods for imposition of Sales Tax under the Punjab General Sales-tax Act, 1948, as follows,-- ", "\"In order to find out the true meaning of the entries mentioned in the Act , what is relevant is not the dictionary meaning but how those entries are understood in common parlance, specially in commercial circles. primarily deals with dealers who are engaged in commercial activity and, therefore, what is of the essence is to find out whether in commercial circles, paddy is considered as identical with rice.\" ", "20. (1968) 21 STC 227 (Mad) entry 47 Schedule I of the Madras General Sales-tax Act, 1959, came up for interpretation before . The said entry contained \"lubricating oils, all kinds of mineral oils, quenching oils and greases\". A question arose whether furnace oil, a non-lubricant, would fall within the ambit of lubricant. Their Lordships observed that the words \"all kinds of mineral oils\" in the ordinary sense had only a limited meaning, namely, mineral oils which were lubricants, and therefore mineral oils could not be covered by entry 47. ", "21. In another case: v. Assistant Sales Tax Officer , AIR 1961 SC 1325 a question arose before while interpreting item 6 of Schedule II of the C. P. and Berar Sales Tax Act, 1947, whether \"betel leaves' are included in the vegetables as mentioned in the said entry. While rejecting the case of the assessee that betel leaves were covered by the expression \"vegetables\" as used in item 6, their Lordships observed that the expression \"vegetables\" must be interpreted not only on the dictionary meaning or in its technical sense or from the botanical point of view but it should be given a meaning as understood in common parlance. Their Lordships in this connection observed as follows,-- ", "\"It, (vegetable) has not been defined in the Act and being a word of every day use it must be construed in its popular sense meaning 'that sense which people conversant with the subject matter with which the statute is dealing would attribute to it'. It is to be construed as understood in common language.\" ", "While arriving at this conclusion their Lord-ships referred with approval the following observations of in AIR 1956 Nag 54:-- ", "\"In our opinion, the word Vegetables' cannot be given the comprehensive meaning the term bears in natural history and has not been given that meaning in taxing statutes before. The term Vegetables' is to be understood as commonly understood denoting those classes of vegetable matter which are grown in kitchen gardens and are used for the table.\" ", "22. Mr. placing reliance on a authority in the (1967) 19 STC 24 (SC) urged that in that case the expression \"sugar\" in entry 47 of Schedule A to the Bambay Sales Tax Act, 1959, was given a wider meaning. It covered all types of product of sugar like patasa, harda and alchidana, and similarly any product made from the woollen fabric will be covered by the expression \"woollen fabric\". This decision, in our opinion, does not affect the principles laid down by the to interpret the taxing statute in a manner in which the term used therein is generally understood in common parlance by those who deal with such commodities. ", "23. The law laid down by in the Gujarat Woollen Felt Mills' case clearly covers the controversy raised in the case before us. We are in respectful agreement with the law laid down by the learned Judges of and we feel that the expression \"woollen fabric\" as used in Item 21 of Schedule I of the Act shall not cover the product of the petitioner-company \"woollen felt\". ", "24. As regards the prayer for the refund of the duty realised by from the petitioner-company we can say that this Court cannot pass a decree in favour of the petitioner for the refund of the said amount while exercising its extraordinary jurisdiction under Article 226 of the Constitution. The petitioner's learned counsel also did not press this claim with that vehemence with which he had argued the case of other points. We, therefore, reject the prayer of the petitioner for the refund of the amount realised as duty on the products of the petitioner-company. ", "25. For the reasons mentioned, the writ petition is partly allowed and it is declared that felt produced by the petitioner-company would not be covered by the expression \"woollen fabric\" as contained in Item No. 21 of Schedule I of the Act and as such shall not realise the excise duty from the petitioner-company. ", "26. Looking to the circumstances of the case we make the costs easy."], "relevant_candidates": ["0000048128", "0000453569", "0000835996", "0001270021", "0001632638", "0001650570", "0001822153", "0117651440"]} {"id": "0000788193", "text": ["JUDGMENT , J. ", "1. This is a defendant's appeal arising out of a suit for declaring an order for the removal of the plaintiff-respondent from service as null and void on account of the contravention of the principles of natural justice in the holding of the departmental inquiry culminating in the order of removal. ", "2. The plaintiff-respondent was a member of and was under the control of the Security Officer, . At the relevant time he was pasted at Abu Road Ha was seen carrying two kilograms of coal which was the property of the Railway. He was served with a charge sheet, departmental proceedings were initiated against him and finally he was visited with the penalty of removal from service by the Security Officer He went up in appeal, but without any success. He then served a notice under Section 80 Civil Procedure Code on and on 2.3.67 instituted the suit in the court of Munsif, Ajmer City (East). The plaint was later on amended with the pel mission of the court and an amended plaint was filed on 16 10.69. The order of removal was challenged on a number of grounds, but it is not relevant to make any reference to all of them except the one ground that the Inquiry Officer did not afford an opportunity to the plaintiff Government servant to adduce oral evidence to rebut the departmental evidence. The suit was contested by . ", "3. The ground on which the two courts below found the order of plaintiff's removal from service to be illegal was that the plaintiff had not been afforded an opportunity to adduce his oral evidence, This was covered by issue No. 1 which ran as follows: ", "Whether Notice No. 30/AS/40/3/1-WR/ 17/65 dated 28.4.66 is void, illegal and inoperative for the reasons mentioned in para 3(a) to 3(j) of the plaint and Para 3(k) to 3(o) of the amended plaint? ", "4. The, aforesaid ground was comprised in Para-3(1) of the plaint. The Union tried to justify the order. It was pleaded that in the circumstances it could not be urged with justification by the plaintiff chat no opportunity to adduce oral evidence had been afforded to him or that consequently there had been violation of the principles of natural justice rendering the order of removal of the plaintiff from service null and void It was argued that, in the first instance, by the order dated 7.8.65 (Ex. A/35) the plaintiff was called upon to furnish the list of his defence witnesses, but the plaintiff had failed to avail of this opportunity and he did not furnish any such list. The reliance was placed on the proceedings sheet dated 25.11.65 which went to show that after the conclusion of the departmental evidence the plaintiff was asked to state what defence he had to furnish and hers also the plaintiff did not choose to avail of the opportunity of expressing his desire to lead any defence evidence Certain cases were cited by both the sides before the learned Civil Judge. The learned Civil Judge considered them and held that the mere fact that the plaintiff had not furnished the list of his witnesses at the initial stage did not disentitle him from leading defence evidence after the closure of the departmental case. The learned Judge pointed out that it was the duty of the departmental officer to have afforded the plaintiff ah opportunity to lead his oral evidence after the closure of the prosecution evidence. According to the, learned Civil Judge, the order sheets dated 25.11.65 and 1.12.65 did not show that such an opportunity was ever afforded to the plaintiff. Consequently, according to the learned Civil Judge, there was violation of the principles of natural justice with the mult that the order of removal from service passed against the plaintiff on the basis of this inquiry was null and void. I may put the conclusion leached by the learned Civil Judge in his own words: ", "From the decisions of their Lordships of cited by me above and of the other also, the preponderance of the judicial decision is that the delinquent should be afforded an opportunity to lead oral evidence in rebuttal of the evidence produced by the department. It is true that the plaintiff was asked to furnish his list in a Memo accompanying the charge-sheet which has been marked Ex. A/35, but his failure to submit the list at the initial stage, does not deprive him of the opportunity to lead oral evidence in his defence after the closure of the departmental case. The Enquiry Officer should have afforded the plaintiff with an opportunity to lead oral or documentary evidence in his defence after the closure of the evidence of the department. The order sheets dated 25.11.65 and 1,12. 65 do not show that such an opportunity was ever afforded to the plaintiff and hence the non affording of this opportunity fully violates the principles of natural justice and vitiates the enquiry conducted against the delinquent plaintiff, and any findings of punishment based on that enquiry, are further vitiated. I therefore, hold that the learned lower court was right in holding that the proof of the allegations contained in Para 3(1) of the amended plaint, violates the principles of natural justice. ", "5. In the result, the learned Civil Judge affirmed the decree of the first court holding that the order of removal of the plaintiff from service was null and void. ", "6. It is in these circumstances that the has come in further appeal to this Court. ", "7. Learned Counsel for the Union has contended that the courts below were in error in decreeing the plaintiff's suit He reiterated that the opportunity to lead evidence had, in fact, been given to the plaintiff. Attention was invited to the documents Ex. A/5, Ex A/16 and Ex A/35. Learned Counsel maintained that in the circumstances it was for the plaintiff himself to have expressed his wish to examine his oral evidence. Then it was argued that there has been full compliance of the statutory rules governing this inquiry and further stressed that the plaintiff himself had not taken this as a ground firstly, in his reply to the show cause notice against the penalty of removal proposed by the appointing authority or subsequently at any stage, such as, as in the departmental appeal or in the notice of suit under Section 80 Civil Procedure Code. According to learned Counsel, it was only in the amended plaint that this ground was raised for the first time; no such ground having been taken even in the plaint that was filed in 1967. Thus according to learned Counsel, there was no merit in this ground; more so when there was no statutory rule for the affording of such an opportunity to 'he plaintiff and when no prejudice is shown to have resulted. Learned Counsel placed reliance on a number of decisions, such as, , , 1966 (2) LLJ 729 and Court 1967 (2) LLJ 375. ", "8. On the other hand, learned Counsel for the respondent tried to support the decree of the court below. He took the stand that it was the duty of the Inquiry Officer to have afforded the opportunity to lead the defence evidence to the plaintiff even if the plaintiff had not specifically asked for it. The plaintiff Government servant had the right to have an opportunity to adduce his defence evidence and the same was required to be made available to him by the Inquiry Officer. Since this was not granted there has been violation of the principles of natural justice according to learned Counsel. He relied on . System 1966 (30) FIR 130, P.Orr & Sons (Privrte), Ltd. and Their Workmen 1958 (2) LLJ 152, which had been reaffirmed in subsequent cases, such as, and read from the \"Law and Procedure of Departmental Enquiries\" by from page 663. ", "9. It is by now firmly established that an Inquiry Officer conducting departmental inquiries against a Government Servant which may entail the punishment of dismissal or removal from service has to act quasi-judicially. He has to follow the rules of procedure governing the inquiry. By and large, such rules embody the principles of natural justice as well, but broadly speaking whenever such rules are silent the principles of natural justice which are not bing but formulation of principles for display of fair play have to be followed. Such principles have been stated in v. Their Lordships had to consider the scope of the words- \"reasonable oportunity\" occurring in Article 311(2) of the Constitution. Their Lordships observed: ", "The reasonable opportunity envisaged to the servant by the provision contained in Article 311(2) includes (a) an opportunity to deny his guilt and establish his innocence, which he can only do if he is told what the charges levelled against him are and the allegations on which such charges are based; (b) an opportunity to defend himself by cross-examining the witnesses produced against him and by examining himself or any other witneses in support of his defence; and finally (c) an opportunity to make his representation, as to why the proposed punishment should not be inflicted on, him, which he can only do if the competent authority, after the enquiry is over and after applying his mind to the gravity or otherwise of the charges proved against the . servant tentatively proposes to inflict one of the three punishment and communicates the same to the government servant. Thus, the protection provided by rules, like Rule 55 of the Civil Services (Classification, Control and Appeal) Rules, is bodily lifted out of the rules and together with an additional opportunity embodied in Section 240(3) of the of India Act, 1935, so as to give a statutory protection to the servants and is now incorporated in Article 311(2) so as to convert the protection into a constitutional safeguard. ", "Here we are concerned with the principle (b) as mentioned in passage and have to see whether the servant in the present case had an opportunity to defend himself by examining himself or any other witness in support of his defence. In the present case the parties are on common ground that the plaintiff was served with a charge sheet accompanted with the statement of allegations. He had submitted his reply thereto, the departmental witnesses were examined in the presence of the plaintiff and he had been afforded the opportunity of cross-examining the departmental witness and he did cross-examine them and further the statement of the plaintiff was recorded after the closure of the departmental evidence. It is also not denied by the defendant appellant that the plaintiff did not examine any defence witness. The point of controversy is whether it was for the Inquiry Officer to have expressly asked the plaintiff to produce his witnesses or it was for the plaintiff to ask the Inquiry Officer to take his evidence. We have to consider here whether the rules of natural justice make it incumbent on the Inquiry Officer to definitely call upon the delinquent servant to produce his defence witnesses, if any, or the servant should himself express this and wish and produce the witnesses. the learned Judges observed: ", "The question of reasonable opportunity to show cause is dependent on the peculiar facts of each case. What is reasonable is, not necessarily what is the best but, what is fairly appropriate under all the circumstances of the case. Reasonable opportunity to show cause does not necessarily include a right to be specifically & expressly granted time to produce evidence in defence even when a public servant does not choose to ask for it and does not express any desire to produce such evidence. The enquiry cannot be considered to be open to challenge on the ground that the procedure laid down in the Evidence Act for recording evidence or in the Code of Criminal Procedure for trial of offences has not been strictly followed. ", "10. 1966 (2) LLJ 729 it was observed by the learned Judge that: ", "As no prayer was made by the petition for adducing defence evidence it cannot be said that as the enquiry officer did not voluntarily give him an opportunity to produce his witnesses in defence, it would amount to a violation of the principles of natural justice. ", "11. Court 1967 (2) LLJ 375 the learned Judges observed that: ", "Stating it broadly, and without intending it to be exhaustive, rules of natural justice require that a party should have opportunity of adducing all relevant evidence on which he relies. The evidence of the opponent should be taken in his presence and that he should be given the opportunity to cross-examine and no materials to be relied on against him without his being given an opportunity of explaining them. It does not appear that there is any further obligation cast on the enquiry officer to ask the chargesheeted person whether he wants to lead any evidence and ascertain the names of witnesses, and cause steps to be taken for their production. ", "12. the learned Judges observed: ", "An opportunity to cross-examine or to adduce evidence is not something that the inquiring authority can tie around the neck of the officer proceeded against; but it is an occasion that arises, and is to be availed of. The usual procedure is that the chargesheet is served and the cause, if any is taken. The evidence if documentary is communicated to the person proceeded against, and if oral, the witnesses cf the department are examined before him. If he is not present, he is asked if he would like to be heard in person. He is then invited to cross-examine, and after it is over, to file his own documentary evidence and call his witnesses, if any, give his argument. ", "13. On the other hand, in v. Vellore Elec System 1966 (30) FIR 130 it was observed that: ", "In a domestic enquiry held into misconduct by an employee, after the examination of the witnesses for the employer and their cross-examination, the accused is entitled to give evidence in person and to have defence witnesses called This right cannot be denied simply because the accused did not give the list of witnesses whom he proposed to call in a proforma which was sent to him for completion along with the charge-sheet. Where the employee asked for an adjournment complaining that he was not being permitted to examine defence witnesses on his behalf, the enquiry officer should give the employee an opportunity to give a list of witnesses after the conclusion of the examination of the prosecution witnesses and to have them examined. Where the services of an employee are terminated without such an opportunity being given to him, the termination will not be valid. ", "14. Court, M.P. Indore 1972 L&IC 511, the learned Judges observed: ", "So far as the first point is concerned, the fact is that on the date of the enquiry the respondent No. 3 was asked the question as to whether he wanted to produce defence witnesses. He stated that the enquiry should be conducted at the site where the occurrence took place. This was taken by the Enquiry Officer as meaning that he did not want to give any evidence. has not read this answer in that sense. is of opinion that by this answer the respondent No. 3 wanted to say that he might be able to produce evidence if the enquiry was conducted at the site and that, therefore, the possibility of his, producing evidence cannot be ruled out. We are unable to say that this interpretation of , is necessarily wrong. It should have been made clear to him that he should produce evidence there if he so liked. On the second point also we have seen order of the officer conducting the domestic enquiry. The order is very short and dots not give any reason for holding that the charges had been proved The Enquiry Officer has not even mentioned the name of witnesses or the nature of evidence that was procuded before him on the basis of which he found the charges proved. We are, therefore, unable to hold that this part of the decision of was without jurisdiction or patently wrong in law. ", "15. Having considered the various cases, I find my self in agreement with the statement that the question of there being reasonable opportunity to show cause is dependent on the peculiar facts of each case. What may not be a reasonable course to adopt in one case may not be considered so in another set of facts. The proceedings must disclose: (1) that by statutory rules, if any, governing the inquiry were in essence complted with, and (2) that the Government servant has bad an adequate opportunity to meet the charges with which he was faced. All the material on which the department seeks to reply should be placed before the Inquiry Officer and the delinquent Government servant should have an opportunity of explaining such material. The evidence should be recorded in his presence and he should have the opportunity to cross-examine the witnesses Further where there are previously recorded statements, he should be furnished with copies thereof if he wants to cross-examine the witnesses on their basis After the closure of the departmental evidence the Government servant should be afforded the opportunity of producing any defence evidence as the Government servant may like to do. Whether the Inquiry Officer should, in so many words, call upon the Government servant to produce his defence evidence or it will be for the Government servant himself to ask for an opportunity to produce his witnesses is a matter which cannot be put down with any rigidity. Here one will have to keep in view the surrounding circumstances of each case. What is reasonable in one case may not necessarily be reasonable in another case. For example, if a Government servant comes from a category who cannot be expected to be fully aware of the valuable right of the Government servant in this regard then it will be expected of the Inquiry Officer to specifically ask the Government servant to produce his defence, if he so wants to do. In another situation, if a Government servant comes from a higher catagory and on account of his education and experience cannot be said to be unaware of his right in this behalf, then the mere fact that the Inquiry Officer had not specifically asked the Government servant to produce his defence evidence may not be of much importance. The essence, of the matter in every case will be whether the Government servant had or had no opportunity to produce his defence. For seeing whether the Government servant had or had no adequate opportunity of meeting the charges against him by having the opportunity of producing the defence one will have necessarily to examine the proceedings taken by the Inquiry Officer. ", "16. In the present case, let us therefore, examine as to what had happened in the case. Ex. A 6 is the charge sheet that he was served on the plaintiff It is a printed form which had been filled in. It is for . After the usual charge in para-2(b) the plaintiff has been called upon to furnish the names and addresses of the witnesses, if any, whom he wished to call in support of his defence The same thing has been said in the covering letter which is again on printed form and it is Ex. A35 Ex. A-17 is the acknowledgement by the plaintiff of his having received the charge sheet with the statement of allegations. Ex. A-7 is his reply to the charge sheet wherein he had written to say that the allegations levelled against him were denied, but the justification for denial could not be laid down in the absense of the relevant records which were refused to him by the disciplinary authority. Further, according to him, the copies of the documents supplied to him were not attested by any officer Then he had given the names of the persons whom he desired to be his defence counsel Then he had given the names of the persons whom he desired to be his defence counsel. Order sheets have been placed on record as Ex A-49. They show that on 13-10-65 the documents were received from 's Office on 27-10-65. the witnesses for the department were present, but the representative of the plaintiff had not come and, therefore, the inquiry could not commence. Same thing happened on subsequsnt dates. On 25-11-65 this is what was recorded: ", " The defaulter and his representative and IPF Jajndany were present. Also who was called for re-examination was present. Their statements were recorded and the D, E. completed. The defaulter has promised to give his final defence statement in writing by 2.12.65 at , as his representative is not free. For final written defence statement next date is therefore fixed at on 2.12.65. ", "Then on 2.12.65 and 5.12.65 the following orders were recorded: ", " The defaulter and his representative were present and they wrote down the defence statement and handed over at 15/- hrs. D E. completed in all respects written and submitted. ", "17. The above proceedings disclose that the entire departmental evidence was recorded on 25.11.65 The plaintiff was asked to give his defence statement in writing by 2.12.65. This was so or desired because the person defending him was not free. Then 2.12.65 was fixed for the final written defence statement, On 2.12.65 the defaulter and his representative wrote down the defence statement and handed it over. Then it is noted that the departmental inquiry was completed in all respects. ", "18. Now, I may turn to Ex. A/16 which contains the further statement of the plaintiff which was recorded on 25.11.65 i.e. the day the departmental evidence was closed. ", "Q You have heard the evidence given by the various witnesses in your presence during this inquiry including their cross-examination. Have you got to say anything in your defence and if so do you want to give it orally or in writing? ", "Ans. I will give my defence statement in writing and that too at Jaipur on 2 12.65 as my representative who is headquartered at is not free to move out of Head qr. ", "This is read over and explained to all concerned in the language familiar to them and is correct. ", "Reading Ex. A/16 and the order sheet of 25 11.65 I have no doubt in my mind whatsoever that what the officer was then contemplating was the taking of the final statement of the delinquent servant and it was far from his mind whether any defence evidence should be recorded or not. The order sheet dated 2.12.65 shows that with the submission of the defence statement which mean the statement of the delinquent Government servant the departmental inquire was considered to be completed in all respects. It was expected of the Inquiry Officer before closing the inquiry, in the circumstances, to have asked thy deliquent servant if he would like to produce any defence evidence An impre ession is created on my mind that with the taking of the statement in writing-of the plaintiff Government servant by the Inquiry Officer thought that he had done his job and the departmental inquiry was complete in all respects. It is true, the Government servant had not furnished the list of witnesses though be was called upon to do so vide the charge sheet Ex. A/5 and the covering letter thereof Ex. A/35, but here I cannot lose sight of what the Government servant had stated in Ex. A/7 dated 24-8-65 wherein he had stated that though he was denying the charge sheet, but he was unable to afford justification for denial in the absence of relevant records which had been refused to him by the disciplinary authority Further he made grievance of the fact that the copies of the documents supplied to him were not duly attested by any officer. It was, therefore, too much of him to be expected that he would be in a position to furnish the list of his defence witnesses when be had not been made aware of the material against him by permitting him to have inspection of the relevant records. This is not to say that at any subsequent stage no inspection was allowed to him or the copies of the documents were not furnished to him. That might have been done. Also I am not saying that what the Government servant had stated in Ex. A/7 was necessarily true, but while considering the question of non-submission of list of witnesses at the initial stage one cannot over-look as to what had happened at that time and and for that Ex. A/7 produced by none other than itself cannot be ignored. It was for them to say that what had been written by the Government servant in Ex. A/7 was contrary to facts. Therefore, non-submission of the list of defence witnesses at the initial stage is of no consequence. Of course, if one were not to find any justification for non-submission of the list of witnesses then it would be for the Government servant to express the desire that he would like to produce the defence evidence at the stage his statement would be recorded or soon thereafter, Even if no list of defence witnesses is produced at the initial stage, but the Government servant wants to examine defence evidence at a later stage that opportunity cannot be denied to him. It may very well happen that the mind is made up about the kind of defence witnesses, one would like to produce only after the entire departmental evidence is recorded. I should, however, add that it is always desirable to furnish a list of defence witnesses where it is possible to do so, but the mere fact that list of witnesses had not been furnished at the initial stages would not disentitle the Government servant to examine his defence evidence at the appropriate stage. Therefore, in the facts and circumstances of the present case I am satisfied that it was for the Inquiry Officer to have asked the Government servant to examine his defence witnesses, if he wanted to do so. It cannot be forgotten that the Government servant came from the ranks in and did not belong to the officer cadre. He may not have, therefore, fully appreciated that it was for him to produce the defence witnesses Then again the charge levelled against the Government servant was quite serious. It is common knowledge that at stations or on the line many of the petty officials do make use of the coal, but that cannot be tolerated in the case of a member of , who is expected to protect the Property whether its value is much or not. In his case undoubtedly the offence would be a serious one and, therefore, full opportunity should be afforded to the servant in such a situation to defend himself. The order of plaintiff's removal from service passed by the appointing authority has rightly been held to be illegal, by the courts below but they have committed one error and it is that the proceedings being not in conformity with the principles of natural justice only from the stage of taking of defence evidence the order cannot preclude the competent authority from re-commencing the procedings from the stage of the recording of defence evidence and the decree of the court below, therefore, requires this modification. ", "19. Accordingly, I hereby allow the appeal in part. Though I uphold the decree of the court below to the extent that the order of removal of the plaintiff from service is illegal, the competent authority shall be at liberty to re-commence the proceedings, if it so desires, from the stage of the recording of the defence evidence and then to pass a proper order according to law. The parties are left to bear their own costs. ", "20. Learned Counsel for the orally prayed for leave to appeal under Section 18 of the Rajasthan High Court Ordinance 1949, but as the has been left free to re-commence the proceedings, if they so want to do, from the stage of the recording of the defence evidence, I am not inclined to grant leave which is accordingly hereby refused."], "relevant_candidates": ["0000527708", "0000546415", "0000840916", "0001834350"]} {"id": "0000790482", "text": ["JUDGMENT , J. ", "1. This second appeal is at the instance of defendant-2nd party against the judgment of affirmance, the trial having decreed the plaintiffs' suit and the lower appellate having dismissed the appeal. ", "2. Since I propose to remand this case to the lower appellate Court, the facts need not be stated in detail. It would suffice to say that the plaintiffs-respondents instituted the instant suit for declaration of title and recovery of possession as also for mesne profits with respect to certain lands described in the Schedule to the plaint. According to the plaintiffs, the suit property was sold at auction in execution of rent decree and purchased by the decree-holder ex-intermediary, who obtained delivery of possession thereon on 20-3-1943. The ex-intermediary, namely, defendant 5th party, is said to have sold the suit land to the plaintiffs under a registered sale deed dated 11-8-1959 and the plaintiffs claimed title and possession by virtue of that sale deed. There was a proceeding under Section 144 Cr. P. C., in respect of the suit land, which was converfed into one under Section 145 Cr. P. C., and which was decided against the plaintiffs; and the defendants 1st and 2nd party are said to have dispossessed the plaintiffs from the suit land on 19-7-1963 leading the plaintiffs to file the suit. ", "3. The defendant 1st party and the plaintiffs compromised the matter admitting the claim of the plaintiffs. The suit was contested by the defendant 2nd party, who claimed to be purchaser of six dhoors of land, out of the suit property by virtue of sale. The auction sale, the sale certificate and delivery of possession in consequence thereof, were all described as paper transaction and it was asserted that neither the ex-intermediary, defendant 5th party, nor the plaintiffs came in possession of the suit land. ", "4. Amongst the issues framed in the trial Court, some of them arc as follows: - ", "(1) Whether the suit was barred by limitation? ", "(2) Whether the sale deed alleged to have been executed in favour of the plaintiffs as also defendant 2nd party was genuine? ", "(3) Whether the story of possession and dispossession set up by the plaintiffs was correct? ", "The suit was a hotly contested one. The parties filed a good number of documents. In addition to these, as many as 15 witnesses were examined on behalf of the plaintiffs and 14 on behalf of the defendant 2nd party. held that the story of possession and dispossession, as set up by the plaintiffs, was correct and that the defendant 2nd party had not acquired title to the suit land by adverse possession. On these and other findings, the plaintiff's suit was decreed including their claim for mesne profits. Defendant 2nd party carried the matter in appeal before the first appellate Court. The lower appellate Court dismissed the appeal confirming the judgment and decree of the trial Court. Although discussed the documentary evidence adduced by the parties, it is undisputed that it did not at all discuss the oral testimony of any of the witnesses either for the plaintiffs or the defendant. ", "5. The sole substantial question of law that was framed for decision in this appeal at the time of its admission may be found in Order No. 12 dated 14-5-1979 which runs as follows:-- ", "\"Whether the decision of the lower appellate Court given without considering the oral evidence led by the appellant is in accordance with law?\" ", "6. , learned counsel for the appellant, vehemently submitted that the judgment of the lower appellate Court stood vitiated for non-consideration of the oral evidence adduced by the parties and as such the judgment and decree of the lower appellate Court was liable to be set aside and justice necessitated a remand of the case. , learned counsel for the respondents, relying on a decision of this Court reported in AIR 1973 Pat 386 ( ) faintly argued that as the lower appellate Court merely affirmed the findings of and as there was discussion of the oral evidence in the judgment of , the judgment of the lower appellate Court need not be interfered with. On the admitted position that the lower appellate Court, surprisingly enough, did not at all discuss the oral evidence of any of the witnesses for the plaintiffs or the defendant, I find myself unable to accept the argument of Sri . ", "7. Order 41, Rule 31 of the Civil P. C. lays down as follows:-- \"Contents, date and signature of judgment:-- The judgment of shall be in writing and shall state-- (a) the points for determination; (b) the decision thereon; (c) the reasons for the decision; and (d) where the decree appealed from is reversed or varied, the relief to which the appellant is entitled; and shall...........\" ", "The object of this rule in making it incumbent upon the appellate to raise points for determination and to state reasons for the decision is to clear up the pleadings and focus the attention of the and of the parties on the specific and rival contentions which arise for determination as also to offer the litigant parties an opportunity of knowing and understanding the grounds upon which the decision proceeds with a view to enable them to exercise, if they see fit, and are so advised, the right of second appeal conferred by Section 100 Civil P. C. ", "The matter involved determination of important questions of fact raised in the pleadings which necessitated a careful consideration of the oral evidence adduced. What to speak of careful consideration, there is no whisper at all about the oral evidence in the judgment of the lower appellate Court. ", "8. Section 100 C. P. C. provides for second appeal, which is to be entertained if is satisfied that the case involves a substantial question of law. A finding of fact arrived at by the lower appellate on due consideration of the evidence becomes final and is binding on this . This necessitates due consideration of the evidence, both oral and documentary, by the lower appellate before recording a finding of fact. ", "9. It is the finding of fact duly recorded by the lower appellate , be it a judgment of either affirmance or reversal, which is binding on this . This necessitates observance by the lower appellate of the mandatory provisions of Order 41 Rule 31, C. P. C., even in cases where the lower appellate affirms the finding of the trial . While it may not be necessary that the judgment should record all the facts in great detail and it should deal mechanically with all the points, it must show that the has brought its independent judgment on a consideration of the relevant evidence, both oral and documentary, to bear on the decision. This being not the position in the instant case, serious infirmity has crept in the judgment of the lower appellate and it must stand vitiated. The decision of this in (AIR 1973 Pat 386) (supra) cannot come to the rescue of the respondents. Paragraph 10 of that judgment would show that in that case the evidence of the witnesses had not been discussed (in detail) which implied that there was some discussion of the oral evidence. The facts too are also distinguishable. ", "10. On the facts and in the circumstances of this case, the submission of Sri. that Non-consideration of the oral evidence by the lower appellate Court would have the effect of vitiating the whole judgment of the lower appellate Court appears to be sound and must prevail. ", "11. The result is that the appeal succeeds and is allowed. The judgment and decree of the lower appellate Court are set aside and the matter is remanded to the lower appellate Court for fresh decision on consideration of the, evidence, both oral and documentary in accordance with law. The cost of this appeal shall abide the decision to be arrived at by the lower appellate Court on remand. ", "12. An application under Order 1, Rule 10 and Order 22 Rule 10 C.P. C. has been filed before this Court by one praying therein for substitution or addition in place of respondent . After keeping a copy of the petition on the record of the second appeal, the original petition should be sent back to the lower appellate Court and the lower appellate Court shall, after hearing the parties, consider this petition and pass orders in accordance with law."], "relevant_candidates": ["0001500430"]} {"id": "0000839441", "text": ["PETITIONER: COMMISSIONER OF INCOME-TAX, GUJARAT Vs. RESPONDENT: A. RAMAN & COMPANY DATE OF JUDGMENT: 18/07/1967 BENCH: , : , J.C. SIKRI, S.M. RAMASWAMI, V. CITATION: 1968 AIR 49 1969 SCR (1) 10 CITATOR INFO : RF 1972 SC 29 (4) E 1973 SC2330 (13) F 1974 SC1358 (10) RF 1975 SC 703 (11) AFR 1976 SC 203 (1,4,12,15,16) F 1977 SC 757 (31) RF 1977 SC2129 (12) R 1979 SC1960 (6,14) RF 1986 SC 649 (16,47) RF 1986 SC1853 (19,21) ACT: Indian Income-tax Act , 1961, s. 147-Conditions for the exercise of power to re-open assessment. Constitution of India, 1950, Art. 226- Powers of to issue writ when Income-tax Officer's jurisdiction to issue notice under S. 147 of the Indian Income-tax Act, 1961 is questioned- must not re-appraise evidence. HEADNOTE: The assessee firm consisted of two partners who were managers of their respective . The firm sold its goods to the aforesaid families and the families again sold the goods on their own account. In income-tax proceedings for the years 1959-60, 1960-61 and 1961-62 the firm and the were separately assessed in respect of their incomes. Subsequently took view that the sale of goods by the firm to the families was only a device to divert the profits of the firm and on this view issued notices under s. 147 of the Incometax Act, 1961 requiring the assessee to show cause why the assessments for the years 1959-60, 1960-61 and 1961-62 should not be reopened. The of Gujarat in a petition for a writ under Art. 226 of the Constitution quashed those notices and restrained the Income-tax Officer from taking proceedings in pursuance thereof. With special leave granted by this Court, the Revenue appealed. Held:(i) The may issue a high prerogative writ prohibiting the Income-tax Officer from proceeding with reassessment when it appears that the Income-tax Officer had no jurisdiction to commence proceedings because the conditions precedent do not exist. [12G-H; 13B- 1, Calcutta, & Anr. 41 I.T.R. 191, followed. It is however not open to the exercising powers under Art. 226 to set aside or vacate the notice for reassessment by itself re-appraising the evidence. [15B] (ii)The condition which invests the Income-tax Officer with jurisdiction has two branches: (i) that the Income-tax Officer has reason to believe that income chargeable to tax has escaped assessment; and (ii) that it is in consequence of information which he has in his possession and that he has reason so to believe. The expression 'information' in the context of which it occurs must mean instruction or knowledge derived from an external source concerning facts or particulars, or as to law relating to a matter bearing on the assessment. If he has such information the Income-tax Officer may commence proceedings under s. 147(1)(b) . But to commence such a proceeding it is not necessary that on the materials which came to the notice of the Income-tax Officer, the previous order of assessment was vitiated by some error of fact or law. [13C-G] (iii)In the present case however the pre-conditions for the issue of a notice of re-assessment did not exist. The law does not oblige a trader to make the maximum profit that he can out of his 11 trading transactions. Income which accrues to a trader is taxable in his hands: income which he could have, but has not earned is not made taxable as income accrued to him. Avoidance of tax liability by so arranging commercial affairs that charge of tax is distributed is not prohibited. [15D-G] JUDGMENT: ", "CIVIL APPELLATE JURISDICTION: Civil Appeal No. 768 of 1966. Appeal by special leave from the judgment and order dated December 18, 1964 of in Special Civil Application No. 332 of 1964. ", ", , and , for the appellant. ", " and , for the respondent. The Judgment of the Court was delivered by , J.-The assessees---are dealers in \"mill stores\" in the course of their business they sell \" mill stores\" to other dealers including two concerns trading in the names of M/s A. M. & Co. and , which are owned by the Hindu undivided families, managers of which are the only partners of the assessees. For the assessment years 1959-60, 1960-61 and 1961-62 the assessees were originally assessed by the Income-tax Officer, Circle-1, Ward-A, Ahmedabad, while the partners of the assessees and the Hindu undivided families which traded in the names of M / s A. M. & Co. and were assessed by Income-tax Officers in other Circles. The cases of assessees, of the partners of the assessees and of the two Hindu undivided families trading in the names of A. M. & Co. and were later transferred to the Income-tax Officer, Group Circle-J, Ahmedabad. That Officer by letter dated March 20, 1964 informed the assessees that he was convinced from a perusal of the assessment records of the assessees, their partners and their individual Hindu undivided families, that the partners of the assessees had contrived to divert profits of the assessees to their respective Hindu undivided families and had tried to \"evade proper taxation\", and on that ground he called upon the assessees to submit their objections, if any, to the reopening of the assessments for the years 1959- 60, 1960-61 and 1961-62. The assessees in reply contended that the Income-tax Officer had no jurisdiction to reopen the assessments since the Hindu undivided families of the two partners and the assessees had submitted \"effect and complete returns of income\" supported by their books of account, \"quantity details\" of purchases, sales and expenses, and had given all material facts and relevant information necessary for assessment at the time of each assessment. ", "The Income-tax Officer issued three separate notices under s. 147 of the Income-tax Act , 1961, requiring the assessees to show cause why the assessments for the years 1959-60, 1960-61 and 1961-62 should not be reopened. in a petition for a, writ under Art. 226 of the Constitution quashed those notices and restrained the Income-tax Officer from taking proceedings in pursuance thereof. With special leave granted by this Court, the Commissioner of Income-tax has appealed to this Court. In support of the claim of the Income-tax Officer, to reopen the assessments, reliance was placed in on cl. (b) of s. 147 (1), of the Income-tax Act , 1961. The material part of s. 147(1)(b) may be read: ", "\"If- ", "(a) ", "(b)notwithstanding that there has been no omission or failure as mentioned in clause (a) on the part of the assessee, the Income-tax Officer has in consequence of information in his possession reason to believe that income chargeable to tax has escaped assessment for any assessment year, he may, subject to the provisions of sections 148 to 153 , assess or reassess such income or recompute the loss or the depreciation allowance as the case may be, for the assessment year concerned. ", "Explanation 1-For the purposes of this section, the following shall also be deemed to be cases where income chargeable to tax has escaped assessment, namely:- ", "(a) where income chargeable to tax has been underassessed; or * * * * *\" ", "Under s. 147(1)(b) reason to believe that income chargeable to tax has escaped assessment in consequence of information in the possession of the Income-tax Officer is a condition precedent to the exercise of his jurisdiction to assess or reassess the income of the assessee. If that condition does not exist, steps taken by the Income-tax Officer to assess or reassess the income will be without jurisdiction. It was held by this in (1) that in appropriate cases has power to issue an order prohibiting the Income-tax Officer from proceeding to reassess the income when the conditions precedent do not exist. At p. 207, , J., delivering the majority judgment of the observed: ", "\"It is well-settled however that though the writ of prohibition or certiorari will not issue against an executive authority, have power to issue in a fit case an order prohibiting an executive authority from acting without jurisdiction. Where such action of an exe- cutive authority acting without jurisdiction subjects or is likely to subject a person to lengthy proceedings and unnecessary harassment, , it is well settl- ed, will issue appropriate orders or directions to prevent such consequences\". ", " may, therefore, issue a high prerogative writ prohibiting the Income-tax Officer from proceeding with re- assessment when it appears that the Income-tax Officer had no jurisdiction to commence proceeding. ", "The condition which invests the Income-tax Officer with jurisdiction has two branches: (i) that the Income-tax Officer has reason to believe that income chargeable to tax has escaped assessment; and (ii) that it is in consequence of information which he has in his possession and that he has reason so to believe. Since the learned Judges of have concentrated their attention upon the second branch of the condition and have reached their conclusion in favour of the assessees on that branch, it would be appropriate to deal with the correctness of that approach. The expression \"information\" in the context in which it occurs must, in our judgment, mean instruction or knowledge derived from an external source concerning facts or particulars, or as to law relating to a matter bearing on the assessment. If as a result of information in his possession, the Income-tax Officer has reason to believe that income chargeable to tax had escaped assessment, the Income-tax Officer has jurisdiction to assess or reassess income under s. 147(1)(b) of the Income-tax Act, 1961. Information in his possession that income chargeable to tax has escaped assessment furnishes a starting point for assessing or reassessing income. If he has that information, the Income-tax Officer may commence proceedings for assessment or reassessment. To commence the proceeding for reassessment it is not necessary that on the materials which came to the notice of the Income-tax Officer, the pre- vious order of assessment was vitiated by some error of fact or law. ", " exercising jurisdiction under Art. 226 of the Constitution has power to set aside a, notice issued under s. 147 of the Income-tax Act , 1961, if the condition precedent to the exercise of the jurisdiction does not exist. The may, in exercise of its powers, ascertain whether the Income-tax Officer had in his possession any information: the may also determine whether from that information the Income-tax Officer may have reason to believe that income chargeable to tax had escaped assessment. But the jurisdiction of the extends no further. Whether on the information in his possession he should commence a proceeding, for assessment or reassessment, must be decided by the Income-tax Officer and not by the High . The Incometax Officer alone is entrusted with the power to administer the Act: if he has information from which it may be said, prima facie, that lie had reason to believe that income chargeable to tax had escaped assessment, it is not open to the High , exercising powers under Art. 226 of the Constitution, to set aside or vacate the notice for reassessment on a re-appraisal of the evidence. in this case was apparently of the view that the information in consequence of which proceedings for reassessment were intended to be started, could have been gathered by the Income-tax Officer in charge of the assessment in the previous years from the disclosures made by the two Hindu undivided families. But that, in our judgment, is wholly irrelevant. Justification of the Income-tax Officer to reassess income arises if he has in consequence of information in his possession reason to believe that income chargeable to tax has escaped assessment. That information, must, it is true, have come into the possession of the Income-tax Officer after the previous assessment, but even if the information be such that it could have been obtained during the previous assessment from an investigation of the materials on the record, or the facts disclosed thereby or from other enquiry or research into facts or law, but was not in fact obtained, the jurisdiction of the Income-tax Officer is not affected. was also of the view that the inference raised by the Income-tax Officer that the Hindu undivided families of the assessees had made profit by sale of articles purchased from the assessees larger than the profit which the assessees had made, was not justified, since there was no evidence on the record about the price at which similar goods were sold by the assessees to other merchants and about the profit which those other merchants made by sale of those goods. But in a petition under Art. 226 of the Constitution the taxpayer may challenge the validity of a notice under s. 147 of the Income-tax Act, 1961, on the ground that either branch of the condition precedent does not exist, but an investigation whether the inferences raised by the Income-tax Officer from the information are \"correct or proper\" cannot be made. Counsel for the Commissioner is, therefore, right in contending that the High entered upon an investigation of matters which were not within their competence. ", "But the appeal of the Commissioner must still fail. The case of the Commissioner on the materials placed before , suffers from a serious infirmity on the first branch of the jurisdictional condition. The averments made in the affidavit filed by the Income-tax Officer in that behalf do not establish the existence of that branch of the condition. In reply to the averment by the assessees that the Income-tax Officer had no reason to believe that income had escaped assessment, the Income-tax Officer stated: ", "\"In the course of the discussions I had at the several meetings hereinabove referred, I also learnt that in the earlier years also the petitioners (the assessees) had effected such sales to the said Hindu undivided families, and that over and above the margin of profits earned by the petitioners (the assessees) from the Hindu undivided families, the Hindu undivided families had earned substantial profits on the resale of such goods. 1, therefore, came to the conclusion that the creation of the Hindu undivided family business was merely a subterfuge or a contrivance by the partners of the petitioner firm (the assessees) to divert the huge profits made by the petitioners (the asses- sees) on imported articles\". ", "The plea raised by the Income-tax Officer is that income which could have been earned by the assessees was not earned, and a part of that income was earned by the Hindu undivided families. That according to the Income-tax Officer was brought about by \"a subterfuge or contrivance\". Counsel for the Commissioner contended that if by resorting to a \"device or contrivance\", income which would normally have been earned by the assessee is divided between the assessee and another person, the Incometax Officer would be entitled to bring the entire income to tax as if it had been earned by him. But the law does not oblige a trader to make the maximum profit that he can out of his trading transactions. Income which accrues to a trader is taxable in his hands: income which he could have, but has not earned, is not made taxable as income accrued to him. By adopting a device, if it is made to appear that income which belonged to the assessee had been earned by some other person, that income may be brought to tax in the hands of the assessee, and if the income has escaped tax in a previous assessment a case for commencing a proceeding for reassessment under s. 147(1)(b) may be made out. Avoidance of tax liability by so arranging commercial affairs that charge of tax is distributed is not prohibited. A taxpayer may resort to a device to divert the income before it accrues or arises to him. Effectiveness of the device depends not upon considerations of morality, but on the operation of the Income-tax Act . Legislative injunction in taxing statutes may not. except on peril of penalty, be violated, but it may lawfully be circumvented. If the goods were nominally transferred to the Hindu undivided families the latter acting merely as benamdars for the assessees, and the profits were earning in truth by the assessees, income earned by sale of the goods by the Hindu undivided families may be held chargeable to tax as income which has escaped assessment to tax in the hands of the assessees. In the present case,, no such case was attempted to be made out in the affidavit filed by the Income-tax Officer. We hold, therefore, that on the materials on the record, the Income-tax Officer. had no reason to believe that income chargeable to tax had escaped assessment for the three years in question. The order passed by is therefore confirmed. There will, however, be no order as to costs in this and . ", " ", "Appeal dismissed. ", "17"], "relevant_candidates": ["0001300646"]} {"id": "0000848722", "text": ["JUDGMENT , J. ", "1. This is a suit by a employee for a declaration that the order terminating her service is wrongful, illegal and void and that she is still entitled to the office. There is an alternative case made for damages for wrongful dismissal. ", "2. The plaintiff is an M.A. and Ph. D. of . Her case is that she; was offered a permanent post of Anthropologist by the in in on June 7, 1949 which offer she accepted. Prior to this appointment she was working in the same department as a temporary Anthropologist which office she relinquished before accepting the new appointment. In the new post she was to be on probation for 2 years. ", "3. The plaintiff's service was terminated by a letter dated June 2, 1952 addressed to her by . Prior to this she was charge-sheeted. She denied the charges and demanded a judicial enquiry. ", "4. The order terminating her service is challenged on the ground that it is in contravention of the Constitution and of the Fundamental Rules. The order it is alleged is void, inoperative and of no effect. The order is fur-ther characterised as malicious, arbitrary ana capricious, mala fide and illegal. In paragraph 15 of the plaint the case of wrongful dismissal is made and damages assessed at Rs. 5,34,804/-have been claimed. ", "5. The reliefs claimed are as follows: ", "(a) A declaration that the order of dismissal of the plaintiff by the defendant is wrongful, illegal void, inoperative and of no consequence whatsoever. ", "(b) A declaration that the plaintiff still remains entitled to hold the office of Anthropologist in as mentioned in the foregoing plaint from which the plaintiff was removed by an illegal order of the defendant. ", "(c) Alternatively, a decree for Rs. 534804/-es mentioned and claimed in paragraph 15 of the foregoing plaint. ", "6. In the written statement it is pleaded that the plaintiff was a probationer and during the probationary period her services were ter-minated. It is denied that she was dismissed. All allegations made as to contravention of the Constitution and/or of the Fundamental Rules are denied. It is denied that the order terminating her service was void and/or unlawful and/or inoperative, malicious or arbitrary. It is denied that the plaintiff has any right to continue in the post of Anthropologist or to hold the same or that her removal from this office is wrongful. The claim for damages has been disputed. It is contended that the letter of appointment dated June 7, 1949, does not comply with the requirements of Section 175(3) of the of India Act, 1935 and that in consequence there was no vaild and binding contract of service between the plaintiff and the . ", "7. To meet the above defence the plaint appears to have been amended pursuant to an order of the dated March 16, 1955. By this amendment, a new paragraph was added to the plaint being paragraph 3A, It is pleaded in that paragraph that accepted and treated the plaintiff to be a government servant in lawful employment. A case of estoppel and ratification is made out in the said paragraph. Apparently, this new case was made to come within the observation of the Supreme in the case of . ", "8. In the additional written statement filed in answer to the new amendment, all allegations in the new paragraph of the plaint have been traversed. It is alleged that the contentions raised in the amended paragraph do not form a part of the notice under Section 80 of the Code of Civil Procedure. In the premises, the notice under Section 80 of the Code of Civil Procedure is in any event insufficient and invalid. ", "9. On the pleadings the following Issues were raised: ", "1) Is there any valid and binding contract of service between the plaintiff and the, defendant in view of the provisions of Section 175(3) of the Government of India Act, 1935? ", "2) Did the plaintiff have the permanent post of Anthropology as mentioned in paragraph 3 of the plaint? ", "3) Did the plaintiff have any opportunity of defending herself? Was there any enquiry held therefor? ", "4) Was the principle of natural justice observed and followed as mentioned in paragraph 12 of the plaint ? ", "5) Is the plaintiff entitled to the declaration asked for? ", "6) Is the plaintiff entitled to any damage as mentioned in paragraph 15 of the plaint? ", "7) Has the plaintiff any cause of action? ", "8) Is the plaintiff entitled to any relief? ", "10. At the trial the plaintiff tendered her own evidence. The defendant did not tender the evidence of any witnesses. The document disclosed by the parties and embodied in the Brief of Documents have been marked as Ex. A, formal proof having been dispensed with by consent. A copy of the notification issued by inviting applications for the post has also been tendered in evidence and marked Ex. B, formal proof also in this ease having been dispensed with. ", "11. The plaintiff's right to sue has been challenged on the ground that there is no valid and binding contract of service between the parties hereto. The contract is evidenced by She letter dated June 7, 1949 of the Director to the plaintiff containing the offer of service and the letter of acceptance of even date. Admittedly, the formalities prescribed by Section 175(3) of the Constitution of India have not been complied with. It is contended by Mr. that there is no contract valid and binding in law and no suit can be maintained on the basis of such invalid contract. There are authorities of this Court in support of the argument advanced by Mr. . In the Case of v. State of West Bengal , I have expressed a contrary view. I have held that such a contract of employment need not comply with the formalities prescribed by Section 175(3) of the Government of India Act and a suit on the basis of such a contract can well be maintained in law. I am informed that the view expressed by me has been approved by in another suit. My attention has also been drawn to a Bench decision of in the case of in which adopted the same view that I had expressed. I told Mr. that I am bound by my own judgment and there is no use further arguing the point before me. Should the matter go up in appeal Mr. will have full liberty to argue the point before . The other side will be entitled in that event to take all points in support of the maintainability of the suit including grounds made in paragraph 3A of the amended plaint. On the grounds stated by me in my judgment I held that there is a valid contract of service in the instant case and the suit is not liable to be dismissed on the ground taken by Mr. . ", "12. The first point to be considered is the position of the plaintiff at the date of appointment and at the date of termination of her service. She was appointed in a permanent post on June 7, 1949 but she should be on probation for two years. Two years expired on June 7, 1951. On the expiry of the period, neither she was expressly confirmed in her service nor her service terminated. What then was her position in service after June 7, 1951? Mr. the learned counsel appearing for the plaintiff submitted that the probationary period having expired, after June 7, 1951, she was on a permanent cadre thereafter. All evidence on record points to this conclusion. Reliance has been placed on the advertisement issued by the inviting applications for the post, the letter of the Under-Secretary dated June 2, 1949, the offer of service made to her by the letter dated June 7, 1949 and the acceptance thereof by her as also on the plaintiff's oral testimony in Court. The plaintiffs evidence is that she applied for the post in response to the advertisement issued. She was interviewed by in May 1949 at Delhi. After interview she was shown a letter signed by the Under-Secretary and she was told informally that she was appointed. Formal letter offering appointment came to her later on June 7 which she formally accepted. Ex. B is the advertisement issued by for recruitment of one. Anthropologist in (Central Service Class D. It contains certain \"Informations for candi-dates.\" Paragraphs 6, 7 and 12 have been referred to in the course of the argument by the learned counsel. They read as follows: ", "(6) \"The post is permanent and pensionable. ", "(7) Persons appointed will be on probation for a period of 2 years. The appointment can be terminated during the probationary period without reason being given. 12. Pay:-- 350-350-380-30-590-E.B.30-770-40-850. Higher initial pay up to a maximum of Rs. 440/- may be granted, as a special case, to a specially qualified and experienced candidate.\" The letter of the Under Secretary to the Direc-tor of Anthropology regarding recruitment of the Anthropologist is in the following terms: ", "'I am directed to refer to the correspondence resting with this 's endorsement No. F. 6/1/47-A.2. dated the 31st December, 1948, on the subject mentioned above and to say that the Governor-General has on the recommendation of selected Dr. (Miss) , M.A.,Ph. D., for appointment to the permanent post of Anthropologist in the department of Anthropology on probation for two years. The scale of pay for this post is Rs. 250-350-380-380-30-590-E.B.-30-770-40-850, but, Dr. (Miss) will receive an initial salary of Rs. 440/-p. m. which will be personal to her from the date of her permanent appointment. ", "2. I am to request that the post may now be offered to Miss and that arrangements may also be made by you at an early date for her examination by a medical board. She should be charged for her medical examination a fee of Rs. 16/- each, one quarter of which should be credited to the . and the balance paid to the members of . The Board's report may kindly be fur- ", "nished to the A. G. West Bengal in due course .....\" ", "13. Pursuant to this an offer was made to the plaintiff by the letter dated June 7, 1949 written by one M. N. Chanda, for the Director. The letter reads as follows: ", "\"I am directed to offer you a permanent post of Anthropologist in in the scale of Rs. 350-350-380-880-30-590-E.B.--20-77-40-850 on an initial salary of Rs. 440/- p. m. which will be personal to you from the date of your permanent appointment. You will be on probation for 2 years. ", "I am to request that the undersigned may kindly be informed urgently if you are willing to accept the offer on the above terms and conditions.\" ", "14. The plaintiff's acceptance of the offer as evidenced by her letter of even date written to the Director which reads as follows: ", "\"In reply to your Memo No. 2032, dated June 7, 1949, I am happy to accept the permanent post of an Anthropologist in the De-partment of Anthropology on the terms and conditions mentioned by you.....\" ", "15. On the same date plaintiff relinquished charge of the office of temporary Anthropologist and assumed charge of the new office. This is evidenced by defendant's document No. 2. ", "\"Certificate of Transfer of Charge. ", "Certified that I have on the forenoon of this day relinquished charge of the office of temporary Anthropologist, . ", "Sd/- . ", "Signature of relieved Officer. ", "Station--Calcutta Designation: Anthropologist. Date--7th June 1949. Signature of relieving Officer. Designation.\" ", "16. All these in the submission of Mr. lead to the conclusion that the plaintiff was appointed as a permanent incumbent in the office though for a period of two years she would be on probation. During the probationary period of two years, her probation and service is liable to be terminated. But if the Government chooses not to terminate the probation and service within the probationary period of two years the plaintiff acquires the full status of a permanent officer on the expiry of the two years. There was no power reserved to the Government to extend the probationary period. It cannot, therefore, be contended that! in the absence of actual confirmation she automatically continues to be a probationer till the date of actual confirmation or till the date of termination of her service. It is to be noticed that neither the letter of appointment nor any other document indicates that the appointment was subject to confirmation. The appointment in the Permanent office was absolutely unqualified. ", "17. Mr. , learned counsel appearing for the defendant contended that even though the letter of appointment and other documents do not indicate that the office was \"subject to confirmation\", yet without an act of confirmation there cannot be a change from proba- ", "tionary to permanent status. That confirmation must necessarily be after the expiry of the probationary period. It follows that after the expiry of the probationary period and till the date of confirmation or .termination of service, the plaintiff continues to occupy the status of a probationer. The point has been considered in a number of cases which may now be considered. In the case of , of gave its views on the point under consi-delation. The opinion is correctly summaris-ed in the head note which reads as follows: ", "\"Where the period of probation of a person appointed in the police department comes to an end he does not automatically become a full member of the service. It is one thing to say that the period of probation had come to an end; it is quite another thing to say his probation was found satisfactory, and he was admitted as a full member of the service. Before the latter could be done, there should be a finding by the concerned superior officer that this probation has been found to be satisfactory. Necessarily the determination of this question can only be taken up after the period of probation has come to an end. It is idle to contend that the superior officer has no right even to come to a conclusion whether the probation has been satisfactory and whether he is entitled to be admitted a full member of the service. In arriving at this conclusion anything which has happened subsequently to the expiry of the period of probation will also be relevant and can be taken into consideration.\" ", "The judgment was delivered by It does not appear from the judgment whether under the Rules or by the letter of appointment power was reserved to the Government to extend the probationary period. It, however, appears from the judgment that in fact there was an extension of the probationary period. Incidentally it should be noted that to this Madras case notice to show cause was Why the \"probation should not be determined\" and not why the \"service should not be determined.\" Mr. naturally relies very strongly on this decision. In the case of , , of this Court consisting of , and , J. expressed their views on the point as under. At p. 101 , , who delivered the judgment makes the following observations: ", "\"A great deal of controversy appears to have taken place before the learned Judge as to whether the appellant had continued to be a mere probationer in service or had become a confirmed member by reason of his having been retained in employment after the expiry of the probationary period. The learned Judge held that the appellant had continued to be a probationer and I find no good reason to dissent from that view. It is quite true that the probationary period was for two years only and that even alter the expiry of that period, the appellant had not been discharged but kept on in service. At the same time, he had not been confirmed. It has also to be noticed that by the very terms of his ap-pointment, he was to be confirmed only if he satisfied both of two conditions, one of which was satisfactory work during the probationary period and the other of which was the passing of a departmental examination. Admittedly, he did not pass a departmental examination during the probationary period and obviously his work was not considered satisfactory. It may have been wrong for not to hold a departmental examination within the probationary period and the appellant, if he was so minded, might have taken appropriate steps at the appropriate time for forcing to hold a timely examination. This point, however, which is somewhat in the appellant's favour, loses a great deal of its force, if one remembers that when the examination was ultimatey held in 1951, the appellant failed to pass it. Be that as it may, whatever might have been the reason for not confirming him, the fact remains that he was not confirmed and if he was not confirmed fie could not claim any status other than that of a probationer.\" ", "In this case the order of appointment specifically provided that the appointee would be confirmed in service on the satisfactory comple-tion of the period of probation and passing of a departmental examination which may be prescribed during the period. It is contended by Mr. that the case is, therefore, distinguishable from our case in which there is no such express condition. In the case of , the point which came up for consideration by a Division Bench of was whether the had power to extend the probationary period. The Court held that the had the power. The case was decided on a construction of the Rules prevailing in Punjab, The case of , decided by a single Judge of and reported in AIR 1939 All 536 is that of a Sub-Deputy Inspector of Schools. He was \"appointed sub-stantively on two years' probation in the Deputy Inspectors of Schools Service.\" Long after the probationary period of two years had expired the State purported to extend the period of probation successively. The right to extend the probationary period was challenged. The Court held on the construction of the Rules that the had no power to extend the probationary period retrospectively and that the order extending the probationary period retrospectively was of no effect. In the case of , decided by , the probationer was allowed to cross the probationary period before his services were finally terminated. , expressed his opinion that after the expiry of the probationary period, the servant cannot be said to be a probationer any longer. The opi- ", "nion, however, does not appear to be backed by reason and cannot be said to be well considered. In the case of v. State of Uttar Pradesh , , J. expressed the opinion that after a probationer had completed the prescribed period of probation and had served the for more than one year after the expiry of that period it cannot be said that he was still on probation. This case also was decided on the interpretation of the Rules of service prevailing in Uttar Pradesh. On the construction of the Rules, the learned Judge recorded his opinion indicated above. There was an appeal against this decision of , J. which was heard by a Division Bench of consisting of , and , J. The decision of is reported in . The appeal was dismissed. The learned Chief Justice makes the following observations in Paragraph 7 of the judgment at P. 846 of the report: ", "\"In the present case the did not confirm the respondent at the end of his period of probation. He admittedly was allowed to continue in service for three more years. In such circumstances it appears to ma that there are only two possibilities: that respondent's further employment must be either permanent or temporary. I am disposed to think that the former view is the better, and that, if the does not exercise its right under R. 19 to dispense with a member of the service during or at the end of his period of probation, but retains him in its employment, it must be deemed to have confirmed him in his appointment. It is not however necessary for me to express a final opinion on this point for, whichever be the correct view, a second question arises.\" ", "The judgment indicates that the opinion of the learned Chief Justice was tentative rather than final. In the case of , , J. expressed the same opinion. In the case of , heard by of and reported in AIR 1960 Mys 65, Chief Justice in delivering judgment expressed his opinion that after the expiry of the period of probation the Government servant ceases to be a probationer. At page 67 of the Report the learned Chief Justice makes the following observation: ", "\"..... It would appear from the said order that the petitioner was appointed as Principal , Gulbarga, That was his substantive appointment to a permanent post. The order no doubt also mentions that he will be on probation for one year. But it does not follow therefrom that even after the expiry of one year he will continue to be on probation or that the Government would be entitled to extend the period of probation. There is nothing in the said order to warrant the conclusion that period of probation will continue even after one year and so long as the petitioner is not confirmed or that the Government would be entitled to extend the said period of probation at its own pleasure. It cannot therefore be said that the petitioner was on probation on the date he was discharged from service. I am, therefore, of the opinion, that the contention of Mr. viz., that the continuance of the petitioner after the period of one year was that of a permanent employee should prevail.\" ", "18. has not delivered any opinion on the point. Judicial opinion as stated above is divided. On the one hand, there is the weighty view of Chief Justice that after the expiry of the probationary period, if the probationer is allowed to continue in service there is no automatic confirmation making the probationer permanent but on the other hand there is an automatic extension of the probationary period. On the other hand we have the equally weighty opinion of Chief Justice of Mysore to the effect that there is in such circumstances no automatic extension of the period of probation but automatic confirmation in the permanent office instead. The opinions of both the learned Chief Justices are entitled to high respect. In the facts of the instant case, however, I am inclined to accept the views of Chief Justice in preference to the views of Chief Justice . The period of 2 years provided for in the instant case was intended to enable the to find out within two years whether the plaintiff was suitable for the job. Two years was thought to be a sufficient period within which the was to make up its mind and terminate the probation and along with it her service. If the chooses not to terminate the probation and service within the prescribed period, the appointee in the permanent post must be deemed to be suitable and stood confirmed in his office. Mr. strenuously argued that the had the right to determine the suitability after taking into account the last date of probationary service. If the probationer committed a lapse on the last date of probation though during the entirety of the probation the probationer proved to be worthy of the office; then reasonably the should be given a reasonable time thereafter to determine the suitability of the probationer for the permanent post Till such decision is taken, the status of the employee cannot be anything other than that of a probationer. The fallacy of this argument is that suitability of a candidate for the office is not determined by a single act, If one act committed on the last date of probation is an instance of unsuitability of the candidate for the office, the offending officer can nevertheless be dealt with and suitable disciplinary action can be taken against him even after the confirmation. Mr. 's argument does not sound very convincing. On the other hand, in the absence of any rule or agreement reserving the 's right to extend the probationary period how can the extend the probationary period by an unilateral act? I cannot find any reason for this. The plaintiff was appointed in a permanent post. She was to remain on probation in that permanent post for a period of two years only in terms of the order and the letter of appointment. Probation and service not having been terminated within the prescribed period, the plaintiff in my judgment became a permanent incumbent to the office after the expiry of two years. ", "19. In the instant case probationary period expired on June 7, 1951. Shortly before that on May 21, 1951, the Director appears to have sent a confidential report of her work finding a num ber of faults in her behaviour and conduct. The said report is set out in extenso as under: ", "'Extract from the Confidential Report on the work of the (Miss) , Anthropologist, for the year 1950. ", "Her impossibe demand for a separate bath-room for her while camping in the Hills, her want of co-ordination with work of the party in general and her failure to get on with other members made her unpopular. Although a very good woman, was pro-cured through the efforts of the Political Officer specially for her at considerable cost, her services were very little utilised by Dr. , inspite of my repeated instructions that she should see more of women and the life they lead by visiting their homes with and by establishing report and cordial feelings with the tribal people. Throughout my stay with the field party in the Hills that year I noticed no improve-ment and I felt that unless she could overcome her apathy and show genuine interest in life, no researches of importance and accuracy were likely to result from her visit. On my return to Calcutta in March I felt it my duty, therefore, to warn her that she must change her attitude and make the best of her trip. When the party returned to Head Quarters, I was, however, informed by the leader of the party that instead of collecting the data herself she used to send her interpreter with a questionaire to the homes to get materials and in every way failed to adapt herself to the surroundings. This was a great disappointment to me as not only did I get her appointed in the Department but still entertained hopes of her ultimately developing into a good Anthropologist inspite of her failures in the past. ", "Her attitude towards her colleagues, temperamental incompatibility to get on with them also showed little improvement. Complaints continued to come about her superior attitude and rudeness of manners even from our Foreign Fellow Dr. . In the discussion's in our seminar meetings she made no contribution and kept herself generally aloof from the acti-vities of the . What is more regrettable, by her attitude and conduct she did not give that co-operation and support in enforcing discipline in the and even went to the extent of writing a very discourteous letter to me. She was shown all consideration and given every chance but unless she can show a very marked improvement in her work and radical change, in her attitude towards her senior officers and courtesy and tolerance towards the junior members she is not likely to fulfil the purpose for which she has been appointed in the .\" ", "20. Mr. , learned junior counsel for the plaintiff, bitterly complained that each one of these facts stated in the said confidential report is false and malicious and in the perspective of subsequent events he can now say that the motive of the Director was to get rid of the plaintiff somehow so that his own wife may be appointed in her place. A copy of the confidential report was given to the plaintiff. The plaintiff was apt to think that the object of sending a copy of the confidential report was to invite answers to the allegations made in the confidential report. She, therefore, gave her answer to the allegations in a letter dated May 27, 1951, addressed to the Minister of Education, New Delhi. In her answer she denied the allegations and gave reasons in proof of its falsity. She asked for an enquiry to determine the truth of the allegations in the confidential report. This letter was sent according to the official practice through the departmental head viz. the Director himself. In early June for urgent domestic reason the plaintiff asked for casual leave for four days from 4th to 7th June, 1951. She in fact took 2 days' leave There are a number of letters relating to this matter. The Director refused to sanction two days' casual leave and took the plaintiff to task for not obtaining previous permission. This led the plaintiff to address another letter to the Hon'-ble Minister on June 24, 1951 by way of appeal against- the warning and praying that the 2 days' casual leave may be sanctioned. On 17th July a show cause notice signed by the Director was served on the plaintiff. The said letter is important and is set out hereunder:-- ", "\"I have been instructed by to inform you that it is proposed to terminate your services as Anthropologist in this Department on the following grounds:-- ", "(i) Failure to discharge your duties as a member of the staff, e.g., reluctance to give lectures as instructed and to participate in seminars; indifference towards research and publications. ", "(ii) Improper conduct and behaviour in general e.g., wilful discourtesy towards colleagues and subordinate staff. ", "(iii) Aid and abetment to peon of the against office discipline e.g., providing him with stationery and typing facilities for his petitions against the Director. ", "(iv) Absence from duty without leave on June 4th and 5th, 1951 and leaving station without permission. ", "(v) Applying for an appointment elsewhere without obtaining the permission of the Head of Department. ", "You are asked to show cause within a fortnight of the receipt of this letter why your services should not be terminated.\" ", "21. A comparison of the allegations made in the confidential report of May 21, 1951 and those contained in the above show cause notice will indicate that all the charges are new except charge, No. (ii) viz. \"Improper conduct and behaviour in general e.g. wilful discourtesy towards colleagues and subordinate staff.\" Allegation of dereliction of duty as alleged in charge No. (i) aiding and abetting by providing with stationery and typing machines as alleged in charge No. (iii), obtaining casual leave for two days, June 4 and 5 and leaving Station without permission and also applying for other appointment without permission of the Head of Department are all new charges and they are no-where to be found in the confidential report. By a letter dated July 27, 1951, the plaintiff asked for particulars of the allegations, and requested that the charges be made more definite. She expressly refers to R. 55 of the Fundamental Rules and was apt to think that the show cause notice initiated an inquiry under Rule 55 of the Fundamental Rules. She denied the letters generally. She made enquiries of the two appeals filed by her on the 27th May and 24th June to viz., the Hon'ble Minister. On July 31, 1951, the plaintiff addressed another letter through the Director on the subject of the show cause notice. The letter concludes with the fol-lowing paragraph:-- ", "\"May I therefore pray that as the matter is a grave and serious one on my part your Honour would be pleased to make an enquiry into the matter by any Superior authority to the Director of this Department and after being satisfied as to the truth of my statements be pleased to set aside all the charges and allegations made against me and confirm me in the service.\" ", "22. On August 31, 1951 and again on September 30, 1951, the plaintiff made enquiries of the Hon'ble Minister about the appeals preferred by her in the 4 letters noticed previously. The language of the inquiry more or less is identical and is in the following terms:-- ", "''I have the honour to submit that the above-quoted appeals are pending with your Honour. They involve the vital questions of my confirmation of service, increment of pay, efficiency, conduct, dismissal, deduction from pay, privilege of leave, and of leaving station, etc.\" ", "23. On October 1, 1951 the Director furnished particulars of the charges contained in the show cause notice dated July 17, 1951. Particulars of dereliction of duty given are:-- ", "(a) Failure to give lectures to the trainees as directed. The lectures were to commence on 5th March, 1951. The plaintiff is alleged to have avoided it first on the plea of ill health and then on the plea that it was not a part of her duty. ", "(b) Non-participation in seminar works held from May 18, 1950 to August 13, 1951. The period is partly within two years of probationary period and partly outside. ", "(c) Indifference towards research and publi-cation. The first instance under this head refers to incidents from December 1948 to February, 1949 i.e., prior to her appointment to the office which was dated June 7, 1949. It is to be noted that, neither of these omissions figured in the con-fidential report of the Director though many of the acts complained of were very near to the date of the report. The second paragraph refers to the failure to take interest in the Abor Woman . This indeed is to be found in the confidential report. The last paragraph refers to a mistake in the publication \"Village Organisation of the Kanikars\" which the plaintiff was asked to correct on July 9, 1951, that is, after the date of termination of the probation. The only other publication consists of data collected by the woman. Under the heading of 'improper behaviour and discourtesy to colleagues', several examples have been given. Of these, A, B, C and D refer to a period prior to her appointment to the post in June 1949; the other refer to the period of probation in the present ser-vice. The last two charges arc of a personal character. Exception is taken to the language or the letter written to the Director on March 29, 1951 and also to her failure to recognise the Director during office hours. ", "24. The allegation of aiding and abetting consists in the Director's suspicion that stationery was supplied and typing facilities given by the plaintiff in addressing a memorial to the Hon'ble Minister for reinstatement in service. Mr. , learned counsel, stated in court that the order of dismissal of passed by the Director was set aside, as a result of this memorial. Regarding the other two allegations, namely, casual leave for two days on 4th and 5th June, 1950 and applying for appointment elsewhere, details given are such that need not be noticed. The last two paragraphs are important and are set out here-under: ", "\"In view of the facts mentioned above, it is proposed to terminate your employment as An-thropologist, , a post you are holding on probation--under Rule 55-B of the Civil Service Classification, Control and Appeal Rules. I have accordingly been instructed by to apprise you of the above grounds and to ask you to show cause, within a fortnight of the receipt of this letter, why your employment should not be terminated. You are also instructed to submit your reply through me and not direct to . No advance copy of the reply sent directly to will be entertained. ", "This also disposes of your letters dated the 27th of May 1951, the 27th of June 1951, the 4th day of July 1951, the 10th of July 1951, the 31st day of July 1951 and the 3lst August 1951, addressed to the Hon'ble Minister for Education, .\" ", "On October 5, 1951, the plaintiff addressed an-other letter to the Minister relating to the allegations made in the Director's letter dated Oc-tober 1, 1951. The charges made in the letter have been characterised as after-thought. The letter concludes as under: ", "\"At para 3 of the letter of the Director under reference he writes that his letter disposes of my appeals dated 27-7-51, 24-6-51 and 31-7-51. It appears therefore that all the appeals I have made have been withheld by the Director without informing me about the reasons for his doing so against the Rules. ", "The Director in hig letter under reference hold my post to be still on probation. But according to the terms of my appointment the probationary period for me has ended on June 7, 1951. ", "In the above circumstances I beg to p that your honour may be pleased to call for all appeals that appear to have been withheld illeglly so far, and also to order for holding a judicial enquiry into all the allegations against me and to offer sufficient scope and opportunity to defend me and my honour and prestige in the matter before your honour comes to any final decisions.\" ", "By letter of January 9, 1952, the Director was informed by the then Education Secretary, Dr. that had decided to terminate the service of the plaintiff. It enclosed a report of dated January .2, 1952. The plaintiff was informed of this Government decision by a letter dated January 11, 1952 and addressed by the Director to the plaintiff. A copy of the report of is annexed to this letter. The report is set out hereunder: ", "\"1. observe that on the conclusion of her probationary period the work and conduct of Dr. (Miss. , Anthropologist, was not considered satisfactory and the following charges were framed against her:-- ", "(i) Failure to discharge her duties as a member of the staff e.g., reluctance to give lectures as instructed and to participate in seminars; indifference towards research and publications. ", "(ii) Improper conduct and behaviour in general e.g., wilful discourtesy towards colleagues and subordinate staff. ", "(iii) Aid and abetment to peon of the against office discipine (e.g., providing him with stationery and typing facilities for his petitions against the Director. ", "(iv) Absence from duty without leave on June 4th and 5th, 1951 and leaving station without permission. ", "(v) Applying for an appointment elsewhere without obtaining the permission of . ", "The specific instances on which the charges were based were also communicated to Miss and she was asked to explain why her services should not be terminated. ", "(3) In her explanation dated 5th October, 1951, Miss has referred to certain previous representations made by her. The have carefully perused all the records of the case including her previous representations. In their opinion her work during the period of probation has been thoroughly unsatisfactory and she has no reply to the charges drawn up against her beyond a categorical statement that they are false and malicious. The also observe that her behaviour towards her colleagues and subordinates has not been satisfactory. She apparently did not take her duties seriously and the would hold that all the charges against her are well founded and proved. The find that Miss has not justified her selection in any way and they have no hesitation in advising that her services should be terminated.\" ", "25. The case is being fought on the ground of law. The challenge is that there is a breach of Article 311(2) of the Constitution and the order of dismissal is illegal. I am not called upon to record my view as to the propriety of the con- ", "duct of the Director or the plaintiff as evidenced by this correspondence. Learned counsel appearing for the parties displayed commendable res- ", "traint and all matters except such as are relevant for the determination of the point of law are kept out of bound. Such facts as disclosed in the documents in record and relevant for the purpose may now be stated: ", "(a) Show cause notice served on 17th July and supplemented by the letter dated October 1, 1951 is after the probationary period had ex-pired. Probationary period expired on June 7, 1951. ", "(b) Many of the grounds taken in the charge sheet are not to be found in the confidential report. For the purpose of the points of law, this fact is not to be considered as reducing the weight of the charges or supporting the case of the plaintiff that the charges continued in the letter dated 17th July were made as an after thought. The question has to be considered from this point of view that whether they are charges proper or adequate relevant for termination of probation or are proper and adequate charges for taking disciplinary measures against a employee on a charge of misfeasance or non-feasance. ", "(c) In the show cause notice the plaintiff was directed to show cause not against termination of probation but termination of service. The word 'dismissal' has not been used. This show cause notice does not purport to be a show cause notice under Rule 53-B of the Fundamental Rules though it appears that the Director purported to give the subsequent notice dated October 1, 1951 in exercise of the power under Rule 55-B of the Fundamental Rules. ", "(d) The plaintiff took the show cause notices as a notice initialing an enquiry under Rule 55 of the Fundamental Rules. She said so expressly in her letter dated May 27, 1951 and demanded definite charges to be framed as required by Rule 55 of the Fundamental Rules. Having regard to the mature of the charges and timing of the letter being after the probationary period, the plaintiff, in my judgment, was justified in so thinking. ", "(e) She all along asked for an enquiry by an officer other than the Director and this has been denied to her. Having regard to the seriousness of the charges and the conduct of the Director, who clearly inspired them, the plaintiff, in my judgment, was justified in asking for an enquiry by somebody other than the Director. ", "(f) There has been a denial of natural justice in this case in not directing an enquiry by an officer other than the Director and, in my judgment, full opportunity should have been given to the plaintiff to answer the charges. ", "(g) The charges made against her and found to have been proved by relate to acts anterior to her appointment to the post of permanent Anthra-pologist during the probationary period and after the probationary period. ", "(h) The charges levelled against the plaintiff are acts in the nature of misfeasance and non-feasance and, in my judgment, are penal in character. Each one of them warranted disciplinary action. In the opinion of , 'all the charges are well-founded and proved.\" It puts a stigma on her competence and thus affects her future career. According to the plaintiff's evidence which I accept, this stood in her way in getting a job to which she is entitled by her ability and qualifications. The termination of service on the grounds alleged amounts, in my judgment, to punishment. It really amounts to dismissal, even though it is described as termination of service. ", "26. I now come to the moat important question to be decided in this Case, namely--Was the order of termination of service lawful? The answer depends on the question--Was the plaintiff entitled to the protection of Article 311(2) of the Constitution? It is conceded that the procedure laid down in Article 311(2) of the Constitution for the protection of civil servants has not been followed in the instant case. It follows that if in law the infant case comes within Article 311(2) of the Constitution, the offending order must be held to be illegal. If not, the plaintiff must fail. ", "27. IT is now settled law that Article 311(2) of the Constitution is attracted whenever the service of a civil servant in the permanent cadre is terminated before the period of his service. In the instant case, I have held that the plaintiff, on the date of the order terminating her service, was a permanent member of the . It follows that the order terminating her service must be held to be unlawful, as it amounts to a violation of Article 311(2) of the Constitution. Mr. conceded that if in fact die plaintiff was a permanent member of the Civil , then the offending order must be held to be unlawful. ", "28. Though I have found that the plaintiff was, at the date of the offending order, a permanent civil servant, there are weighty authorities which indicate that her status in service continued to be probationary even after the expiry of the probationary period. The authority I have in mind is the judgment of , noticed before. Assuming that I am wrong in my view that at the material date the plaintiff was a permanent member of and that her status continued to be that of a probationer even after the expiry of the probationary period, what would be the position in law? In law, a pro- ", "bationer has no right to service and the probation can be terminated at the will of the Government. Having regard to this fact, can it be contended that the provisions of Article 311(2) of the Constitution are attracted in the instant case? ", "29. has expressed its view and laid down the law on the point in three cases which have to be considered now. In the case of , decided by of and . , C. J. deals with the case of probationers and officiating Government servants and makes the following observation in paragraph 27 of his judgment at p. 49 : ", "\"It does not, however, follow that, except in the three cases . mentioned above, in all other cases, termination of service of a who has no right to his post e.g., where he was appointed to a post, temporary, or permanent, either on probation or on an officiating basis and had not acquired a quasi permanent status, the termination cannot, in any circumstance, be a dismissal or removal from service by way of punishment. Cases may arise where the may find a unsuitable for the post on account of mis-conduct, negligence, inefficiency or other disqualification. If such a was appointed to a post, permanent or temporary, either on probation or on an officiating basis, then the very transitory character of the employment implies that the employment was terminable at any time on reasonable notice given by the . Again if the was appointed to a post, permanent or temporary, on the express condition or. term that the employment would be terminable on say a month's notice as in the case of then the might at any time serve the requisite notice. In both cases the may proceed to take action against the in exercise of its powers under the terms of the contract of employment, express or implied, or under the rules regulating the conditions of service, if any be applicable, and ordinarily in such a situation the will take this course. But the may take the view that a simple termination of service is not enough and that the conduct of the has been such that he deserves a punishment entailing penal consequences. In such a case the may choose to proceed against the on the basis of his misconduct, negligence inefficiency or the like and inflict on him the punishment of dismissal, removal or reduction carrying with it the penal consequences. In such a case the will be entitled to the protection of Article 311(2).'' In the case of , heard and decided by another Constitution Bench of and this point was further considered. At P. 691 of the report , C. J., who delivered judgment, refers with approval to the judgment of , C. J. in 's case. The law as laid down in the two above cases is that even if the service of the probationer is dispensed with on the ground of mis-conduct, negligence, inefficiency or the like, the termination of service is by way of punishment because it puts a stigma on his competence and thus affect his future career. The facts in the Bihar case are that Govt. was in on probation. A show cause notice was served on him wherein a number of charges were framed against him. The passed an order of discharge on the basis of its own confidential reports. No enquiry as contemplated by Article 311(2) was held and no opportunity was given to the to show cause. The order of discharge was set aside on the ground that it was by way of punishment. Mr. appearing for the plaintiff submitted that the above decision covers the instant case. I have held that the offending order terminating service is by way of punishment, because it puts a stigma on Ithe plaintiff's competence and was likely to af-'fect and in fact did affect her career. The submission of Mr. must, therefore, be accepted. ", "30. Mr. , learned counsel for the respondent has cited subsequent judgment of in the case of State of Orissa v. which, according to Mr. , is more on the point, inasmuch as the decision expressly considers the effect of Rule 55B of the Fundamental Rules. According to Mr. , neither 's case nor case considered the effect of Rule 55B of the Fundamental Rules. Hence this Orissa case is the authority to be followed in the instant case where the Government purported to act under Rule 55B. No doubt Rule 55B along with other Rules regulating the service conditions of Gov-ernment officers in Orissa was considered in the above Orissa case heard by . But that fact cannot make this case the only authority on the point and only authority to be applied in the case of termination of service of a probationer. , J. who delivered judgment of the court, cites 's case and case. Far from dissenting from the above two decisions, the learned Judge quotes with approval portions of the judgment from the two cases and takes pains to point out that the proposition laid down by , C. J. in case is not inconsistent with thei judgment. On the facts of the case and on construction of the various Orissa Rules as also Rule 55B of the Fundamental Rules, their Lordships came to the conclusion that it was merely a case of termination of probation and not of dismssal. It was not by way of punishment and it was held that by the order no stigma was cast on the officer and his future career was in no way af-fected. ", "31. It is to be noticed that in the cited case the notice was to this effect: Why he should not be discharged from service for gross neglect of duty and unsatisfactory work. The order of discharge, however, records that the ground of discharge was for unsatisfactory work and not 'gross neglect of duty.' , therefore, held that discharge of a probationer on the ground of unsatisfactory work cannot be by way of punishment; it does not affect the future career of the servant and the discharge leaves no evil consequence or stigma on the discharged officer. On this finding the order of discharge was upheld and the order of the Orissa High Court was set aside. It was pointed out by , J. that because of this fact the decision of , C. J. in case , would not be of any use to the petitioner. ", "32. The above case cited by Mr. is distinguishable from the instant case. In the instant case, the plaintiff's service was terminated on the ground that the plaintiff was proved to have been guilty of various acts of misfeasance and non-feasance. I have held that the offending order was by way of punishment and did affect the plaintiff's future career. The case, is akin to and is very much similar to case and the rule in case, rather than the rule in 's case should be applied to the facts of the instant case. ", "33. For reasons stated above, it must be held that the offending order terminating the plaintiff's service is bad in law and I make a declaration accordingly. ", "34. The next question to be considered is whether the plaintiff can get damages for wrongful dismissal. Mr. has contended that the only relief to which a servant illegally dismissed in breach of Section 240(3) of the of India Act is entitled to is a declaration that the order was wrongful and that he was still a servant. In the case of v. North-West Frontier Province, 1941 FCR 37: (AIR 1942 FC 3), held that the plaintiff was not entitled to recover damages for wrongful dismissal. Subsequently in the case of , after making a declaration that the dismissal was wrongful, remitted the case to with this direction that \"the High Courf do take such action in regard to any application duly made by or on behalf of of Mr. for leave to amend to claim damages as shall deem right; On further appeal to by its judgment reported in High Commr. for , set aside the above direction. Lord , who delivered the judgment of the Board, quoted, with approval the observation of Lord in the Scottish case reported in v. The (1926) SC 842 as laying down the law correctly. It was held that pay could not be recovered by action against the , but by only petition, memorial or remonstrance. The view expressed by Lord in 's case , has been dissented from by in the case of . cited with approval the decision of in Punjab Province v. , AIR 1947 FC 23. It was held in Pundit's case as well as in case that the rule of English law that a civil servant cannot maintain a suit against the or the for the recovery of arrears of salary does not prevail in India. The proposition is denied that a civil servant serves the 'ex gratia' and that the salary is in the nature of a bounty. It is pointed out that Section 240 of the of India Act, 1935 itself places restrictions and limitations on the exercise of the 's pleasure in dismissing a civil servant. These restrictions and limitations are imperative and mandatory. To the extent the rule that the servants hold office during pleasure has been de-parked from by the statute, the servants are entitled to relief, like any other person under the ordinary law and that relief therefore must be regulated by the Code of Civil Procedure.' The law now has been laid down by that the 'bounty theory' and the 'pleasure theory' do not stand in the way of the servant from suing the in the ordinary court. It has been held that the servant is entitled to recover arrears of salary by a suit in . ", "35. There is no authoritative decision ot laying down that a -eminent servant can sue for damages for wrongful dismissal. If the relation between the ernment servant and the ernment is contractual, and the ernment servant is entitled to the remuneration for service rendered, there is no reason why the ernment servant will not be entitled to get damages for wrongful dismissal just like an ordinary servant against his master. The observations of in the case of is to the effect that ithe relationship between the -ernment and its servants is contractual and the Fundamental Rules become part of the contract of service. On this basis clearly an action for damages for wrongful dismissal lies against the ernment. The other view is that the suit to recover damages for wrongful dismissal in breach of Section 240(3) of the ernment of India Act is an action in tort. Even then an action in tort lies against the -ernment in respect to all acts of ernment except those in exercise of the sovereign power of the State. I do not think that the employment of the plaintiff as an Anthrapologist in the Anthrapological Department of the Union ernment can be said to be an act in exercise of the sovereign power of the State, in my judgment a civil servant wrongly dismissed in breach of Section 240(3) of the ernment of India Act or Article 311(2) of the Constitution is entitled to maintain an action for damages for wrongful dismissal. ", "36. The damages a servant is entitled to get from his master for wrongful dismissal is the loss suffered by reason of such dismissal. in his Treatise on Damages 11th Edition at page 293 lays down the rule as under: ", "\"The measure of damages is the loss incurred. Prima facie this is the loss of wages which would have been earned had the em-ployment continued according to contract, together with the value of the other advantages Under the contract such, for example, as the benefit of quarters rent-free, maintenance, or otherwise. But, in estimating the loss, due allowance must be made for the emoluments of any other employment obtained before the trial or of any employment likely to be obtained before the contract would have expired. If is the servants duty to minimise the damages, and, for this purpose to seek and accept suitable employment. But he is not expected to accept an engagement in a lower status, though it may be reasonable for him, in the State of the labour market, to accept a lower salary; and this will be taken into consideration in the calculation of the damages.\" ", "It is argued by Mr. that the same rule will apply in the case of Government servants wrongfully dismissed. According to the evidence tendered by the plaintiff that after wrongful termination she made attempt to get a suitable job but could not get any till September, 11955 when she obtained a Research Fellowship at in India. She was given a stipend at the rate of Rs. 400/-per month. Sometime after on December 1, 1956 the plaintiff was appointed a Reader in Sociology by at a salary of RS. 540/- per month. Calculating damages on the basis laid down by above Mr. submitted that the claim of the plaintiff would come up to little over Rs. 30,000/-. She would not claim anything for the period after her appointment at . ", "37. When the case came up for hearing there was a talk of settlement and the plaintiff Was agreeable to accept Rs. 10,000/- by way of settlement. The settlement however fell through because the was only agreeable to make payment on 'ex-gratia' basis and the plain-tiff was not willing to settle without having a declaration that the termination of service was wrongful. Mr. , pointed out in opening toe case that without having such a declaration she would have difficulty in getting a post un-der the in future. She was willing to accept the amount indicated above, if the submits to a decree declaring the termination of service to be wrongful. Now, that the plaintiff is getting the declaration, the plaintiff is willing to accept the sum of Rs. 20,000/- in full settlement of her claim if the does not prefer an appeal. There will be a decree for Rs. 30,000/-, but if pay-ment is made by the and the does not prefer an appeal, the plaintiff is willing to accept Rs. 20,000/- in full satisfaction of the decree. There will be a decree for Rs. 30,000/-, as indicated above and a declaration. Certified for two counsel. The decretal amount will carry interest at the rate of 4 per cent per annum. The amount of the decree will be payable within three months and if not paid the decree would be executable after a period of three months. The plaintiff is also entitled to the costs of this suit. Certified for two counsel."], "relevant_candidates": ["0000032468", "0000253852", "0000480602", "0000527368", "0000925200", "0001101100", "0001471864", "0001910029", "0050506037"]} {"id": "0000853570", "text": ["JUDGMENT , J. ", "1. In this appeal by special leave filed by the of Uttar Pradesh, there are three respondents-(1) ; (2) and (3) . All the three were tried by the Sessions Judge of Sultanpur for the offence of committing the murder of , brother of , P.W. 1. Respondent No. 1 was convicted under Section 302 of the Penal Code and sentenced to death. The other two respondents were convicted for the said offence with the aid of Section 34 and each of them was awarded a sentence of life imprisonment. The respondents filed an appeal in and a reference for the confirmation of the death sentence imposed upon respondent No. 1 was also made by the Sessions Judge. has rejected the reference allowed the appeal and acquitted all the three respondents. Hence this appeal by the . ", "2. There is a college known as at Kurwar, P.S.Kotwali, in the District of Sultanpur. Several students from different villages were reading in the various classes of the college, including the respondents, the deceased, his brother and some other P.Ws. There existed a bad blood and enmity between the two factions and groups of students-one hailing from village Naugawan Teer and the other belonging to village Dharain.The respondents belonged to the latter group. The deceased had associated himself with the former faction. On February 16, 1973 at the instigation of the respondents, it is said, one -a student of class IX-A went to the class room of VII-B and gave a few slaps and blows to , P.W. 8 who is a resident of Naugawan Teer. intervened and rescued . Thereupon, the respondents are said to have given a threat to .A day later on February 17, 1973 when the Tiffin interval started at 1.00 P.M. students came out in the play ground of the college. At that time in the field, respondents 2 and 3 instigated respondent 1 to assault . The said two respondents caught hold of his hands and respondent 1 plunged his knife deep into the back of .After receiving the knife blow, staggered, fell down and collapsed immediately,The occurrence was witnessed by , , , P.W. 2, , P.W. 3 and , P.W. 4. The dead body of was taken in a bus to the Police Station, nine miles aways and the First Information Report was lodged by at 2.00 P.M. ", "3. The respondents denied their complicity in the occurrence.In in their statements under Section 342 of the CrPC, 1898, none of them said a word pleading any right of defence or any assault on , respondent No. 2. In , however, stated: ", "On 17-2-73 a quarrel had taken place between accused and deceased In course of that scuffle was being beaten meantime, while mediating,someone stabbed . ", "'s statement in under Section 342 , in this regard, was in these terms: ", "The reason of my absconding was that on 17-2-73, during interval time, and 10-15 boys had, saying that on 16-2-73, in the evening at Kurwar Market I had got beaten by , beaten me in the play ground. And on my raising alarm some boys had gathered there. While saving me some one out of the crowd inflicted knife injury to in his back and he fell down then and there. ", "It may be stated here that in the cross-examination of it was suggested to him that had received injury due to attack on him by and other. denied the suggestion. No evidence was adduced by the defence in support of their plea that was attacked, beaten and injured in the college play ground on the date and at the time of the occurrence. One defence witness namely Dr. , D.W. 1 was examined in support of the injuries having been found on the person of . According to his evidence, he examined on 23-2-1973 and found eight scabbed wounds and abressions on the various parts of his body including the head. All the injuries were simple and of a very superficial kind. The Doctor was not in a position to give any definite opinion as to when they might have been inflicted or caused. There was no other evidence, as already stated, in support of the halting plea of the defence that injuries had been caused to during the occurrence in question resulting thereafter in the giving of the fatal blow to by some one. Even so , in our opinion, wholly erroneously and unjustifiably, accepted the respondents plea of right of private defence and acquitted them under a wrong impression that according to the defence it was Singh and other who launched an assault upon and then someone stabbed giving the fatal blow in order to rescue . ", "4. has affirmed the finding of as regards the incident which took place on February 16, 1973.That finding was correct and unassailable. But on pure conjuncture and surmises it had led itself to accept the respondent plea of right of private defence. ", "5. one of us (Untwalia, J. delivering the judgment of this Court with approval at page 1483 a passage from the judgment of Hegde, J., in the case of , (1968) 2 Section C.R. 455. It will be useful to extract that passage in this judgment also. It runs as follows: ", "It is true that applicants in their statement under Section 342 Cr. P.C. had not taken the plea of private defence, but necessary basis for that plea had been laid in the cross-examination of the prosecution witnesses as well as by adducing defence evidence. It is well settled that even if an accused does not plead self-defence, it is open to the court to consider such a plea if the same arises from the material on record-see in re and another AIR 1927 Mad 97. The burden of establishing the plea is on the accused and that burden can be discharged by showing preponderance of probabilities in favour of that plea on the basis of the material on record. ", "6. In the instant case one can say justifiably that there was no plea of right of private defence set up by any of the respondents. A vague suggestion given to P.W. 1 in his cross-examination and the belated stand taken by respondents 1 and 2 in their statements under Section 342 . in was of no avail to the defence. There was no suggestion to P.W. 1 that had any part to play in the alleged attack on at the time of the occurrence. in his statement named as one of the attackers, but was not bold enough to claim that he had given the blow to to rescue . in his statement named as one of the attackers but did not name at all. He also had not the courage to take a stand that it was because of the attack on him that inflicted the fatal blow on with a knife. The Doctor's evidence was too shaky to show even on the basis of preponderence of probabilities that the injuries on were inflicted or caused on the 17th February at about 1.00 P.M. There was so to say, not an iota of evidence in support of this stand. Even assuming that got the injuries at the time of the occurrence, there was nothing to indicate that injury on was caused by or anybody else in order to defend . ", "7. In our judgment was in error in acquitting the respondents on the basis of their stand of right of private defence. ", "8. But, even so, we do not feel confident to say that respondent 2 and 3 can be held guilty for the murder of with the aid of Section 34 of the Penal Code. Only one blow had been given on the back of , The prosecution story that it was so given by at the instigation of the other two respondents or that each of them had caught hold of one hand of the deceased and then the blow was given by is a doubtful and inherently improbable story. was a lad of 16 years of age and there was no necessity as none appears on the occular testimony of the prosecution witnesses, of catching hold of his hands in order to give the blow on his back. The blow must have been given by suddenly in a split second. We would there fore, maintain the acquittal of respondents 2 and 3 extending to them the benefit of doubt as regards their complicity in the crime. But there can be no doubt that Mohammad ,respondent No. 1 had inflicted the blow on the back of with a knife.The evidence of the four eye witnesses was fully trustworthy, could not be & has not been rejected even by . And believing that evidence, we hold that the charge of murder has been amply proved against Mohammad .The blow, according to the report and evidence of the Doctor who held the autopsy over the dead body of , was sufficiently deep and fatal. It was sufficient in the ordinary course of nature to cause his death. It did cause his instantaneous death. did intend to cause that injury and therefore, he is guilty under Section 302 of the Penal Code. We find no justification to accept the argument put forward by his learned Counsel that he could be held guilty under Section 304 and not under Section 302 . But we think on the facts and in the circumstances of the case the extreme penalty of death sentence is not warranted.Ends of justice will be served by sentencing to life imprisonment. ", "9. In the result we dismiss the appeal as against , respondent No. 2 and , respondent No. 3 and maintain their acquittal as recorded by but for different reasons. We allow the appeal against , respondent No. 1, set aside 's order for acquittal passed in his favour, uphold the order of conviction made by the Sessions Judge under Section 302 of the Penal Code but instead of sentence of death imposed upon him by the Trial Judge, we sentence him to undergo imprisonment of life."], "relevant_candidates": ["0001479705", "0001660698"]} {"id": "0000867830", "text": ["JUDGMENT , J. ", "1. The present writ petition has been filed for quashing the award-dated 7.8.1998 passed by respondent No. 1, Annexure-3 to the writ petition. ", "2. The facts arising out of the present writ petition are that the petitioner was appointed in of respondent No. 2 at on 1.9.1986 as typist-cum-clerk at the rate of Rs. 20/- per day on a permanent and regular vacancy but no appointment letter in favour of the petitioner was issued. However, the petitioner had worked till 7.9.1987 and without any order, the services of the petitioner were terminated. It was assured by respondent No. 2 that he would be accommodated. When the petitioner was not given appointment, he raised a dispute before . Before the Conciliation Officer, there was no settlement, as such as required under Section 10, the matter was referred for adjudication. A written statement was filed on behalf of the petitioner to the effect mat the petitioner has completed 240 days in one calendar year, has continuously worked from 1.9.1986 to 7.9.1987 and his services, have been illegally terminate without complying the procedure of retrenchment. A reply was submitted by respondent No. 2 and ii has been stated in the written statement that the petitioner has not worked for 240 days in a calendar year. The petitioner has worked in different spells when necessity arose. It has also been denied that the services of the petitioner have been terminated. The petitioner was engaged on daily wage basis; as such the service regulation of the bank is not applicable in the case of the petitioner. after considering the submissions made on behalf of the parties though has come to the conclusion that termination of the petitioner is bad being in breach of provisions of Section 25M of the Industrial Disputes Act but he will not be entitled for reinstatement and a compensation to the tune of Rs. 10,000/- has been given in lieu of reinstatement. The said award was given by the order-dated 7.9.1998 ", "3. It has been contended on behalf of the petitioner that has not given any finding regarding documents filed on behalf of the employer and employee in support of their pleadings as to how the Court has come to the conclusion that the workman has worked only for 155 days. without disclosing the nature of the said document, the finding of is liable to be set aside The finding recorded by at the petitioner is not entitled to the benefit of Section 25F of the Industrial Disputes Act is against the evidence on record because no notice as required, was given in writing before retrenchment to the petitioner, as such, the finding recorded by is liable to be set aside. It has further been submitted that when has recorded a finding that retrenchment of the petitioner is against the provisions of Section 25H and 25M of the Industrial Disputes Act, no relief other than reinstatement with full back wages should have been awarded by . Further submission made on behalf of the petitioner is that the petitioner was regular employee, as such, the services of the petitioner cannot be terminated or retrenched without following the proper procedure as provided under the law. ", "4. Reliance has been placed upon a judgment has been submitted that in the aforesaid case the workman who was a salesman his services were terminated. held that the termination order did not constitute retrenchment as it appears that the workman was on probation and as such it does not amount to retrenchment within the meaning of Section 2(OO) read with Section 25F of the Industrial Disputes Act. has allowed the appeal and has held that it amounts 10 retrenchment within the meaning of the Act Another judgment has been relied upon by the Counsel for the petitioner which is reported in 2005 (Vol. 107) F.L.R. Page -182, Union of India v. Presiding Officer, Kanpur and has submitted that the Single Judge of this Court has taken a view that once the order of termination of a workman found not in accordance with law. he will be entitled for reinstatement with full back wages. ", "5. On the other hand, the respondents submitted that the Government of India has taken a decision on 1.1.1986 that all the appointments of the bank including the clerks is to be conducted by , as such the bank itself has got no authority to make any appointment on the post of clerk/typist except by the . The petitioner was engaged only to clear the extra typing work according to the need and exigency. Initially he was engaged from 17.11.1986 to 16.12.1986 for Rs. 20/- per day. Thereafter, the petitioner worked from 27.3.1987 to 13.4.1987, 29.4.1987 to 31.5.1987 1.6.1987 to 30.6.1987, 1.7.1987 to 31.7.1987 and thereafter from 1.8.1987 to 7.8.1987 and 8.8.1987 to 7.9.1987 for Rs. 25/- per day As such the total working of the petitioner comes to 156 days only. The petitioner has falsely staled that he has worked in the bank starting from 1.9.1986 to 7.9.1987 As the petitioner was engaged on daily wage basis as per the need of the bank to clean extra typing work, as such there is no question of termination of the services of that petitioner by the bank. It is wrong to say that any assurance was given to the petitioner. It has also been stated that the application before was highly time barred, as after 1987 the petitioner has not worked and he raised a dispute before in 1990 The finding recorded by is based on evidence and the documentary evidence, which was filed on behalf of the employer, Exts. M-1 to M-22 have been considered and. as the nature of the appointment was not on a regular post, as such, the compensation awarded by was correct ", "6. I have heard , learned Counsel for the petitioner and who appears for the respondent No. 2 and have perused the record. has recorded a finding on the basis of the pleadings of the parties that as the nature of the appointment of the concerned workman was not permanent and from the written statement filed on behalf of the employer, Ext. M-22 which is the attendance register, clearly goes to show that the workman has worked only for 155 days in broken period, therefore, has held that benefit of Section 25F of the Industrial Disputes Act is not applicable to the workman. Though a finding to this effect has been recorded that the petitioner has competed 240 days in a year but inspite of the aforesaid fact, it has been held that the petitioner is not entitled to the benefit of Section 25M of the Industrial Disputes Act and taking into consideration the nature of appointment. the relief of reinstatement was refused and in lieu thereof Rs. 10,000/- have been awarded as compensation. In a recent judgment reported, in 2005 SCC (L & S) 609, has taken a view that a temporary workman or a probationer, their services not being permanent in nature, can be dispensed with and it is the discretion of to grant the relief of reinstatement with continuity of service and back wages in every case of dismissal or discharge from service. The power under Section 11A of the Act is discretionary. Para 54 of the said judgment is quoted below: ", "54. Mr. , as noticed hereinbefore, has referred to a large number of decision for demonstrating that this had directed reinstatement even, if the workmen concerned were daily-wagers or were employed intermittently. No proposition of law was laid down in the aforementioned judgments. The said judgments of this , moreover, do not lay down any principle having universal application so that the , or far that matter , or this , may feel compelled to direct reinstatement with continuity of service and hack wages The has some discretion in this matter, Grant of relief must depend on the fact situation obtaining in a particular case. The industrial, adjudicator cannot be held to he hound to grant some relief only because it, will be lawful to do so. ", "7. Another case of reported in 2005 SCC (L & S) 154, it has been held that as the daily wager does not hold any post, a daily wager in the absence of any statutory provision would not be entitled for regularization The relevant observation in para 39 is being reproduced below: ", "39. It is furthermore evident that the persons appointed as daily-wagers held no posts. The appointments, thus, had been made for the purpose of the project which, as indicated hereinbefore, came to an end. The plea of Dr. to the effect that the appellants in Civil Appeal No. 337 of 2002 were asked to perform other duties also may not he of much significance having regard to our foregoing findings. However, it has been seen that even services of one of them had been requisitioned only for the project work, , in our opinion, was right in arriving at the conclusion that the appellants were not entitled to he regularized in service. ", "8. In view of the aforesaid fact and considering the judgment as the nature of the appointment of the petitioner was daily wager and has been made only for certain period, to do certain work and as the nature of the appointment of the petitioner was not permanent, therefore, in, jay opinion, was justified in refusing the relief of reinstatement as was the best Court ,to adjudicate the reliefs claimed by the workman. Following the principles, has awarded Rs. 10,000/- as compensation. ", "9. In the aforesaid circumstances, I find no illegality in the impugned award dated 16.9.1998. The writ petition is devoid of merit and is hereby dismissed No order as to costs."], "relevant_candidates": ["0000093828", "0000538062"]} {"id": "0000887203", "text": ["PETITIONER: DEPUTY COMMISSIONER, SALES TAX (LAW) BOARD OF REVENUE(TAXES) Vs. RESPONDENT: PIO FOOD PACKERS DATE OF JUDGMENT09/05/1980 BENCH: , R.S. BENCH: , R.S. , P.N. , V.D. CITATION: 1980 AIR 1227 1980 SCR (3)1271 CITATOR INFO : R 1981 SC 976 (1) RF 1981 SC1014 (5) R 1986 SC 662 (31) R 1986 SC1809 (5) D 1987 SC1885 (8) RF 1988 SC 113 (5) R 1988 SC 992 (5) RF 1988 SC 997 (7,11) R 1988 SC1133 (2,3,5) R 1988 SC2237 (6) RF 1989 SC 516 (17,18) RF 1991 SC2222 (22) ACT: Kerala General Sales Tax Act, Section 5-A(1)(a) \"consumes such goods in the manufacture of other goods for sale or otherwise\", meaning of-Exigibility to tax of pineapple fruit. when processed into slices for the purpose of being sold in sealed cans. HEADNOTE: The respondent assessee, carries on the business of manufacturing and selling canned fruit besides other products. The Pineapple purchased by the assessee is washed and then the inedible portion, the end crown, skin and inner core are removed, thereafter the fruit is sliced and the slices are filled in cans, sugar is added as a preservative, the cans are sealed under temperature and then put in boiling water for sterilisation. In its return for the year 1973-74 under the Kerala General Sales Tax Act, 1963 the assessee claimed that a turnover of Rs. 3,84,138-89 representing the purchase of pineapple fruit was not covered by Section 5-A(1)(b) of the Act. It was asserted that the pineapple was converted into pineapple slices, pineapple jam, pineapple squash and pineapple juice. The assessee maintained that by the conversion of pineapple fruit into its products no new commodity was created and it was erroneous to say that there was a consumption of pineapple fruit \"in the manufacture of\" these goods. The Sales Tax Officer did not accept the contention and completed the assessment on the finding that a manufacturing process was involved and that, therefore, the case fell within s. 5-A (1) (a). In revision before , the assessee conceded that pineapple jam and pineapple squash would be covered by s. 5- A(1)(a), and in regard to pineapple juice the found that s. 5-1(a) was attracted. The only question which remained was whether the preparation of pineapple slices fall within s. 5-A(1)(a). On that question two members of the found in favour of the assessee, and the third member found in favour of the . The then applied in revision to and , has by its judgment dated 24th January, 1978, maintained the order of the . Dismissing the appeal, by special leave, the court ^ HELD : 1. When pineapple fruit is processed into pineapple slices for the purpose of being sold in sealed cans, there is no consumption of the original pineapple fruit for the purpose of manufacture within the meaning of Section 5A(1)(a) of the Kerala General Sales Tax Act, 1963 [1277 E-F] 2. Section 5-A(1)(a) of the Kerala General Sales Tax Act envisages the consumption of a commodity in the manufacture of another commodity. The goods purchased should be consumed, the consumption should be in the process of manufacture, and the result must be the manufacture of other goods. 1272 There are several criteria for determining whether a commodity is consumed in the manufacture of another. The generally prevalent test is whether the article produced is regarded in the trade, by those who deal in it, as distinct in identity from the commodity involved in its manufacture. Commonly, manufacture is the end result of one or more processes through which the original commodity is made to pass. The nature and extent of processing may vary from one case to another, and indeed there may be several stages of processing and perhaps a different kind of processing at each stage. With each process suffered, the original commodity experience a change. But it is only when the change, or a series of changes, take the commodity to the point where commercially it can no longer be regarded as the original commodity but instead is recognised as a new and distinct article that a manufacture can be said to take place. Where there is no essential difference in identity between the original commodity and the processed article it is not possible to say that one commodity has been consumed in the manufacture of another. Although it has undergone a degree of processing, it must be regarded as still retaining its original identity. [1274 F-H, 1275 A-B] In the present case, there is no essential difference between pineapple fruit and the canned pineapple slices. The dealer and the consumer regard both as pineapple. The only difference is that the sliced pineapple is a presentation of fruit in a more convenient form and by reason of being canned it is capable of storage without spoiling. The additional sweetness in the canned pineapple arises from the sugar added as a preservative. The pineapple slices continue to possess the same identity as the original pineapple fruit. [1275 G-H, 1276- , 10 S.T.C. 827 (SC); Commissioner of Sales Tax, U.P., Lucknow v. & Sons, 21 S.T.C. 17 (SC); followed. v. , 100 L.ed. 917; v. United States, 52 L. ed. 336-338; quoted with approval. ., 11 STC 698, , 15 STC 719; , 17 STC 316 and ., 32 STC 623; held inapplicable. 3. The fact that the pineapple slices have a higher price in the market than the original fruit does not imply that the slices constitute a different commercial commodity. The higher price, is occasioned only because of the labour put into making the fruit more readily consumable and because of the can employed to contain it. It is not as if the higher price is claimed because it a different commercial commodity. [1277 A-B] 4. The fact that the pineapple slices appeal to a different sector of the trade and that when a customer asks for a can of pineapple slices he has in mind something very different from fresh pineapple fruit does not give to the canned pineapple slices a separate identity either. The distinction in the mind of the consumer arises not from any difference in the essential identity of the two, but is derived from the mere form in which the fruit is desired. [1277 B-C] 1273 5. Clause (1) (a) of Section 5-A of the Kerala General Sales Tax Act, speaks of goods consumed in the manufacture of other goods for sale or goods consumed in the manufacture of other goods for purposes other than sale.[1277 C-D] JUDGMENT: ", "CIVIL APPELLATE JURISDICTION: Civil Appeal No. 2398 of 1978. ", "Appeal by Special Leave from the Judgment and Order dated 24-1-1978 of at Ernakulam in T.R.C. No. 2 of 1976. ", ", and for the Appellant. ", ", and Mrs. for the Respondent. ", "The Judgment of the Court was delivered by , J. This appeal by special leave is directed against the judgment of holding that the turnover of pineapple fruit purchased for preparing pineapple slices for sale in sealed cans is not covered by s.5-A(1)(a) of the Kerala General Sales Tax Act, 1963. ", "The respondent, Messrs. (\"the assessee\"), carries on the business of manufacturing and selling canned fruit besides other products. In its return for the year 1973-74 under the Kerala General Sales Tax Act, 1963 the assessee claimed that a turnover of Rs. 3,64,138-89 representing the purchase of pineapple fruit was not covered by s. 5-A(1)(a) of the Act. It was asserted that the pineapple was converted into pineapple slices, pineapple jam, pineapple squash and pineapple juice. Section 5-A(1) ", "(a) of the Act provides: ", "\"5-A. Levy of purchase tax- ", "(1) Every dealer who, in the course of his business, purchases from a registered dealer or from any other person any goods the sale or purchase of which is liable to tax under this Act, in circumstances in which no tax is payable under section 5, and either- ", "(a) consumes such goods in the manufacture of other goods for sale or otherwise; or ........................................ shall, whatever be the quantum of the turnover relating to such purchase for a year, pay tax on the taxable turnover relating to such purchase for the year at the rates mentioned in section 5.\" ", "The assessee maintained that by the conversion of pineapple fruit into its products no new commodity was created and it was erroneous to say that there was a consumption of pineapple fruit \"in the manufacture of\" those goods. The Sales Tax Officer did not accept the contention and completed the assessment on the finding that a manufacturing process was involved and that, therefore, the case fell within s. 5-A(1)(a). In revision before , the assessee conceded that pineapple jam and pine-apple squash would be covered by s. 5-A(1)(a), and in regard to pineapple juice the found that s. 5-1(a) was attracted. The only question which remained was whether the preparation of pineapple slices fell within s. 5-A(1)(a). On that question two members of the found in favour of the assessee, and the third member found in favour of the , The then applied in revision to and has, by its judgment dated 24th January, 1978, maintained the order of the . ", "It appears that the pineapple purchased by the assessee is washed and then the inedible portion, the end crown, skin and inner core are removed, thereafter the fruit is sliced and the slices are filled in cans, sugar is added as a preservative, the cans are sealed under temperature and then put in boiling water for sterilisation. Is the pineapple fruit consumed in the manufacture of pineapple slices ? ", "Section 5-A(1)(a) of the Kerala General Sales Tax Act envisages the consumption of a commodity in the manufacture of another commodity. The goods purchased should be consumed, the consumption should be in the process of manufacture, and the result must be the manufacture of other goods. There are several criteria for determining whether a commodity is consumed in the manufacture of another. The generally prevalent test is whether the article produced is regarded in the trade, by those who deal in it, as distinct in identity from the commodity involved in its manufacture. Commonly, manufacture is the end result of one or more processes through which the original commodity is made to pass. The nature and extent of processing may vary from one case to another, and indeed there may be several stages of processing and perhaps a different kind of processing at each stage. With each process suffered, the original commodity experiences a change. But it is only when the change, or a series of changes, take the commodity to the point where commercially it can no longer be regarded as the original commodity but instead is recognised as a new and distinct article that a manufacture can be said to take place. Where there is no essential difference in identity between the original commodity and the processed article it is not possible to say that one commodity has been consumed in the manufacture of another. Although it has undergone a degree of processing, it must be regarded as still retaining its original identity. ", "A large number of cases has been placed before us by the parties, and in each of them the same principle has been applied: Does the processing of the original commodity bring into existence a commercially different and distinct article ? Some of the cases where it was held by this that a different commercial article had come into existence include (where raw tobacco was manufactured into bidi patti), (raw hides and skins constituted a different commodity from dressed hides and skins with different physical properties), (raw tobacco manufactured into chewing tobacco) and , (paddy dehusked into rice). On the other side, cases where this has held that although the original commodity has undergone a degree of processing it has not lost its original identity include (where hydrogenated groundnut oil was regarded as groundnut oil) and Commissioner of Sales Tax, U.P., Lucknow v. and sons (where bristles plucked from pigs, boiled, washed with soap and other chemicals and sorted out in bundles according to their size and colour were regarded as remaining the same commercial commodity, pigs bristles). ", "In the present case, there is no essential difference between pineapple fruit and the canned pineapple slices. The dealer and the consumer regard both as pineapple. The only difference is that the sliced pineapple is a presentation of fruit in a more convenient form and by reason of being canned it is capable of storage without spoiling. The additional sweetness in the canned pineapple arises from the sugar added as a preservative. On a total impression, it seems to us, the pineapple slices must be held to possess the same identity as the original pineapple fruit. ", "While on the point, we may refer to v. , where held that dressed and frozen chicken was not a commercially distinct article from the original chicken. It was pointed out: ", "\"Killing, dressed and freezing a chicken is certainly a change in the commodity. But it is no more drastic a change than the change which takes place in milk from pasturising, homogenizing, adding vitamin concentrates, standardising and bottling.\" It was also observed: ", "\".................. there is hardly less difference between cotton in the field and cotton at the gin or in the bale or between cottonseed in the field and cottonseed at the gin, than between a chicken in the pen and one that is dressed. The ginned and baled cotton and the cottonseed, as well as the dressed chicken, have gone through a processing stage But neither has been \"manufactured\" in the normal sense of the word.\" ", "Referring to v. ", "United States the Court said: ", "\"Manufacture implies a change but every change is not manufacture and yet every change in an article is the result of treatment, labour and manipulation. But something more is necessary...................There must be transformation; a new and different article must emerge, having a distinctive name, character or use.\" ", "And further: ", "\"At some point processing and manufacturing will merge. But where the commodity retains a continuing substantial identity through the processing stage we cannot say that it has been \"manufactured\". The comment applies fully in the case before us. ", "Although a degree of processing is involved in preparing pineapple slices from the original fruit, the commodity continues to possess its original identity, notwithstanding the removal of inedible portions, the slicing and thereafter canning it on adding sugar to preserve it. It is contended for the that pineapple slices have a higher price in the market than the original fruit and that implies that the slices constitute a different commercial commodity. The higher price, it seems to us, is occasioned only because of the labour put into making the fruit more readily consumable and because of the can employed to contain it. It is not as if the higher price is claimed because it is a different commercial commodity. It is said that pineapple slices appeal to a different sector of the trade and that when a customer asks for a can of pineapple slices he has in mind something very different from fresh pineapple fruit. Here again, the distinction in the mind of the consumer arises not from any difference in the essential identity of the two, but is derived from the mere form in which the fruit is desired. ", "Learned counsel for the contends that even if no manufacturing process is involved, the case still falls within s. 5-A(1) (a) of the Kerala General Sales Tax Act, because the statutory provision speaks not only of goods consumed in the manufacture of other goods for sale but also goods consumed otherwise. There is a fallacy in the submission. The clause, truly read, speaks of goods consumed in the manufacture of other goods for sale or goods consumed in the manufacture of other goods for purposes other than sale. ", "In the result, we hold that when pineapple fruit is processed into pineapple slices for the purpose of being sold in sealed cans there is no consumption of the original pineapple fruit for the purpose of manufacture. The case does not fall within s. 5-A(1)(a) of the Kerala General Sales Tax Act. is right in the view taken by it. ", "The appeal fails and is dismissed with costs. ", "S.R. Appeal dismissed."], "relevant_candidates": ["0000453569", "0000903306", "0001105204", "0001416018", "0001609169"]} {"id": "0000913572", "text": ["CASE NO.: Appeal (civil) 271 of 1989 PETITIONER: COLLECTOR OF CENTRAL EXCISE, GUNTUR RESPONDENT: ARUNA STRAW BOARDS (P) LTD. DATE OF JUDGMENT: 27/08/1999 BENCH: K. VENKATASWAMI & M. JAGANNADHA RAO JUDGMENT: ", "JUDGMENT 1999 Supp(1) SCR 529 The Judgment of the Court was delivered by , J. This appeal by the is preferred against an order dated 19.4.88 of , New Delhi, (hereinafter referred to as `the Tribunal'). ", "The question that arises for consideration is whether the duty of excise is leviable under the provisions of the Central Excise Act on the quantities of single ply straw board manufactured and cleared without payment of duty for manufacture of multiple ply straw board/straw board of higher D.G. in the same factory of production. ", "Briefly stated, the facts are the following:- ", "The respondents are the manufacturers of paper boards falling under T.I. 17 of the Central Excise Tariff. They manufactured single ply straw boards and a major portion of the single ply boards was cleared on payment of duty at the factory gate. A portion of the single ply boards was used in the manufacture of multiple ply straw boards within the factory of production and the multiple ply straw boards are removed from the factory after payment of duty. A show-cause notice was issued by the calling upon the respondent why the duty should not be levied on single ply straw boards used for the manufacture of multiple ply boards within the factory. The period for which the payment was demanded was from 20.2.83 to 22.7.83. The respondent replied to the show-cause notice denying the liability and the Assistant Collector, after perusing the reply, found that there was no essential difference in identity between the original commodity, namely, single ply straw board, and the processed article, namely, multiple ply straw boards, and the mere joining of two or three single ply straw boards by means of an adhesive would not necessarily lead to a conclusion that a commercially different and distinct commodity came into existence. The Assistant Collector also gave other reasons to come to the conclusion that the single ply straw board cleared for manufacture of multiple ply straw board in the same factory cannot be subjected to the duty of excise. Accordingly, by this order dated 6.2.84 he dropped all further proceedings initiated against the respondent pursuant to the show-cause notice issued for the period mentioned above. ", "The , aggrieved by the order of the Assistant Collector, preferred an appeal to the Collector of (Appeals), Madras. by its order dated 11.6.84 gave a finding as follows:- ", "`During the relevant time the tariff description under Entry No. 17 of Central Excise Tariff was as under: ", "`Paper and paper board, all sorts (including paste board, mill board, straw board, a carboard and corrugated board) and...' From the above description, it is clear that all sorts of paper boards including straw boards would fall under T.I. 17 and specifically would fall under sub-item (1) (unless such straw board is elsewhere specified, which is not the case). Therefore the tariff description does not distinguish between single ply and multiple ply straw boards and does not prescribe any standard of thickness, before a board could be called a straw board. Therefore, straw board whether it is single ply or double ply or triple ply or multiple ply would continue to be described as straw board and would fall under the same sub-item (10) of T.I. 17 during the relevant period. Hence, charging single ply straw board to duty and again charging multiple ply straw board manufactured out of such single ply straw board sheets within the same factory to duty would clearly amount to double levy. ", "On this short ground, application merits rejection.' also gave additional reasons in support of the above conclusion. Ultimately, the appeal was dismissed. ", "Still aggrieved, the preferred a further appeal to the . The by its order dated 19.4.88 dismissed the appeal. ", "A three-member Bench of the Tribunal, consisting of Vice President and two Technical Members, considered the matter. One Technical Member (Shri ), who has written a detailed order, found as follows:- ", "`We observe that both the single ply and multiple ply straw boards answer to the description straw boards and multiple straw boards cannot be considered as paste boards even in terms of the definition given in the cited by the '. ", "Thereafter, a discussion on the decision of a five-member Bench of the in the case of ., (1986) 24 ELT 542 and also on the decision of in , reported in (1988) 33 ELT 292, was made. The conclusion reached by him was to the effect that in view of the decision of (supra), the five-member Bench decision of the (supra) cannot be followed. Apart from this reference to Rule 49(4) read with Rule 9 of the Central Excise Rules was also made and discussed. Ultimately, the appeal was dismissed. The Vice President (J) (), in his separate order, has observed as follows:- ", "`From Brother 's order I observe that single ply and multiple ply boards are both straw boards. In view of this I would not for the present like to say that effect of the decision in , (1988) 33 ELT 292 (Bombay) is to unsettle the decision in , case (1986) 24 ELT 542. The product in two stages not being distinct in name, character or use there could be no question of demanding duty at both the stages. In this view of the matter the applicability of Rule 49(4) and Rule 9 discussed by Brother in para 3 of his order is also in my view of academic importance. With these words I agree with Brother that the appeal should be dismissed.' Another Member (Technical) () concurred with the order of the Vice President (J). It is clear from the above that the majority decision of the was dehors the judgment and also the five-member Bench decision of the . It rested on the scope and interpretation of Tariff Item 17. ", "The learned counsel appearing for the , however, argued before us mainly inviting our attention to the fact that the judgment of (supra) relied on in the detailed order of the has since been overruled by this Court in . Supp 2 SCC 348. Therefore, according to the learned counsel, the decision of the has to be set aside. No argument was addressed before us challenging the conclusion of the Assistant Collector, the Collector (Appeals) and the on the scope of Tariff Item 17 as well as the finding that single ply and multiple ply boards are both straw boards as enumerated in the said Item. ", "The respondent is not represented before us. Therefore, we have ourselives gone through the orders of the Assistant Collector, the Collector (Appeals) and the , in particular, the order of the Collector (Appeals) and the order of the Vice President (J) We are in agreement with the view expressed by the Collector (Appeals) on the interpretation of T.I. 17, which has been approved by the Vice President (J), with whom the Member (Technical) has concurred. That being the position, the reversal of the decision of (supra) by this in (supra), is not relevant and the same cannot be pressed into service to upset the decision of the . ", "In the result, the appeal fails and is dismissed accordingly with no order as to costs."], "relevant_candidates": ["0000716482", "0001084767"]} {"id": "0000917632", "text": ["JUDGMENT Mitter, J. ", "1. This is really an unfortunate case for although the merits of the case are in favour of the appellant we are constrained to arrive at a decision adverse to him on the ground of limitation. It appears that one obtained a decree for rent against and his cosharers in Rent Suit No. 876 of 1916. One had the decree assigned to him and he applied for execution of the decree in the year 1920 by sale of the rent property. In that execution the holding in question was sold and it was purchased by a lady of the name of for a price of Rs. 1,255 on 27th July 1920. The sale was confirmed in August. Two of the judgment-debtors, one of whom was an infant, applied on 27th July 1923 under Order 21, Rule 90, Civil P. C, for setting aside the sale. At all subsequent stages this application under Order 21, Rule 90 was prosecuted by alone. The application to set aside the sale was allowed in the first instance by an order of the dated 12th March 1924. When the sale was set aside by this order the gave a direction for refund of the purchase-money with interest to the auction-purchaser. The sale proceeds were in excess of the amount due under the decree and therefore the portion of the surplus sale proceeds remained in deposit for payment to the judgment-debtors, the decree-holder having already taken the sum which was found due to him. In accordance with this order, of refund the auction-purchaser withdrew from the a sum of Rs. 442.11-9 which really was to be credited to the judgment-debtors as a part of the surplus proceeds which the judgment-debtors would be entitled to in the event of the sale being confirmed. A direction was given to the decree-holder to refund the amount withdrawn by him. ", "2. The decree-holder however preferred an appeal to the District Judge against the order setting aside the sale. After several intermediate proceedings to which it is not necessary to refer, the sale was ultimately confirmed by an order of the appellate dated 17th August 1925. An appeal was however taken to against the order confirming the sale by one of the judgment-debtors and not by the present appellant . however was made a respondent to the said appeal. That appeal was dismissed on 24th March 1927 and on 22nd March 1930 put in an application for an order on the auction-purchaser to re-deposit the amount which had been withdrawn by him from the out of the surplus sale proceeds. ", "3. The who dealt with the matter in the first instance was of opinion that the auction-purchaser should be compelled to re-deposit the money which he had withdrawn. On appeal however by the auction-purchaser the District Judge was of opinion that she would not be entitled to retain the surplus sale processes but for the plea of limitation which had been taken by her. The District Judge was of opinion that the right of the judgment-debtor for restitution really accrued on 17th August 1925 when the order setting aside the order setting aside the sale, or in other words the order confirming the sale was made by the District Judge on 17th August 1925 under Article 181 of the Schedule to the Limitation Act . As this application for restitution was not made within three years from the time when the right to apply accrued the application was barred by the said article. He accordingly dismissed the application of the judgment-debtor for restitution on the ground of limitation. ", "4. Against this decision the present appeal has been preferred and it has been contended on behalf of the appellant that the application could not be treated as one under Section 144 , Civil P. C, namely, as an application for restitution. It was really an application for asking the to exercise its inherent powers under the provisions of Section 151 , Civil P. C, and in support of this contention reliance has been placed on the recent decision of this in the case of , v. in which my learned brother , J., held that in the circumstances similar to the present the could act under its inherent powers under Section 151 , Civil P.C. The learned Judges did not decide in that case that even if the application be treated as one under Section 151 , Civil P. C, the article of limitation applicable is not Article 181. Of course there is a decision of the Patna High which has been referred to by the learned advocate for the respondent in the case of v. AIR 1925 Pat 1, 'where it was held that an application in such cases comes both under the provisions of Sections 144 and 151 , Civil P.C. The real question therefore in controversy is as to when the right did accrue in the appellant for asking for the refund of the money withdrawn by the auction-purchaser seeing that the sale has now been confirmed and the money being in excess of the decretal amount really belongs to the judgment-debtor. It has been held in a series of cases that the right to apply accrues really on the date when for the first time a decision is given which entitled the parties asking for restitution to have restitution and that was undoubtedly in this case on 17th August 1925. ", "5. It is argued however that as an appeal was pending against that decision the appellant before us could not consistently ask for restitution, for that position would have been inconsistent with the conduct of the appeal. We were at the first blush inclined to agree with the view, for it was argued on the basis that the appellant was one of the appellants before the District Judge. That however does not appear to be so for the present appellant was merely a respondent in the said appeal and there was in our opinion nothing to prevent appellant from asking for restitution. It is said on behalf of the appellant that he could not have possibly taken that course as that would have affected any right which he might have acquired if the appeal against the order confirming the sale had been allowed. We do not see much force in that contention. It was not he who had appealed; he was rather content with the order confirming the sale. In such circumstances as this the right to ask for refund of the money withdrawn by the auction-purchaser arose on 17th August 1925 and he ought to have applied within three years from that date. We are of opinion therefore that the learned District Judge was right in the view which he has taken. Stress has been laid on a recent decision of their Lordships of in the case of . Mr. has drawn our attention to a passage in that judgment which runs as follows: ", "It is at least an intelligible rule that so long as there is any question sub judice between any of the parties those affected shall not be compelled to pursue the so often thorny path of execution which, if the final result is against them, may lead to no advantage. ", "6. These words were said with reference to the provisions of Article 182 , Lim. Act, and the question which was for consideration before their Lordships of was as to whether the word \"appeal\" in Section 182(2) , Lim. Act, meant any appeal of any kind and their Lordships were of opinion that there was no warrant for reading into the words any qualification that the appeal must be regular or competent and that the parties to such subsequent execution proceedings must be parties thereto or that the whole decree must be imperilled. On the other hand, there are observations of in that very case which would go to show that in construing the provisions of the Limitation Act equitable considerations are out of place and the strict grammatical meaning of the words is the only safe guide. In this view we are of opinion that the right to apply accrued as soon as the order of the District Judge was made in August 1925 confirming the sale and as the present application was not made within three years from that date it has been rightly held that the application was barred by limitation. It might be a misfortune to the appellant but we have to administer the law as we find it. The appeal is dismissed. There will be no order as to costs. ", ", J. ", "7. I agree."], "relevant_candidates": ["0001909215"]} {"id": "0000936707", "text": ["CASE NO.: Appeal (civil) 887 of 1975 PETITIONER: RESPONDENT: & . DATE OF JUDGMENT: 07/11/1975 BENCH: A.N. RAY (CJ) & & K.K. MATHEW & M.H. BEG & Y.V. CHANDRACHUD JUDGMENT: ", "JUDGMENT 1975 AIR 2299 = 1976 (2) SCR 347 = 1975 Suppl. SCC 1 Civil Appeals Nos. 887 and 909 of 1975 The Judgment was delivered by , C.J. : ", ", C.J. for the In Civil Appeal No. 887 of 1975 the appellant is and the respondent is . Civil Appeal No. 909 of 1975 is the cross objection of the respondent. On July 14, 1975 it was directed that both the appeals would be heard together. The appeals arise out of the judgment of dated June 12, 1975. held that the appellant held that the appellant held herself out as a candidate from December 29, 1970 and was guilty of having committed corrupt practice by having obtained the assistance of gazetted officers in furtherance of her election prospects. further found the appellant guilty of corrupt practice committed under section 123(7) of the Representation of the People Act, 1951 hereinafter referred to as the 1951 Act by having obtained the assistance of a gazetted officer for the furtherance of her election prospects. held the appellant to be disqualified for a period of six years from the date of ", "2. It should be stated here that this judgment disposes of both the appeals. Under directions of this Court the original record of was called for. The appeal filed by the respondent with regard to issues Nos. 2, 4, 6, 7 and 9 formed the subject-matter of cross objections in Civil Appeal No. 909 of 1975. The cross objections are the same which form grounds of appeal filed by the respondent in at Allahabad against an order of dismissal of Civil Misc. Writ. No. 3761 of 1975 filed in at Allahabad. ", "3. The Constitution (Thirty-ninth Amendment) Act, 1975 contains three principal features. First, Article 71 has been substituted by a new Article ", "71. The new Article 71 states that subject to the provisions of the Constitution, may by law regulate any matter relating to or connected with the election of a President or Vice-President including the grounds on which such election may be questioned. ", "4. The second feature is insertion of Article 329A in the Constitution. Clause 4 of Article 329A is challenged in the present appeals. There are six clauses in Article 329A. ", "5. The first clause states that subject to the provisions of Chapter II of Part V [except sub-clause (e) of clause (1) of Article 102] no election to either of of a person who holds the office of Prime Minister at the time of such election or is appointed as Prime Minister after such election; and to of a person who holds the office of Speaker of that at the time of such election or who is chosen as the Speaker for that after such election; shall be called in question, except before such authority [not being any such authority as is referred to in clause (b) of Article 329] or body and in such manner as may be provided for by or under any law made by and any such law may provide for all other matter relating to doubts and disputes in relation to such election including the grounds on which such election may be questioned. ", "6. Under the second clause the validity of any such law as is referred to in clause (1) and the decision of any authority or body under such law shall not be called in question in any court. ", "7. The third clause states that where any person is appointed as Prime Minister or, as the case may be, chosen to the office of the Speaker of , while an election petition referred to in Article 329 ", "(b) in respect of his election to either House of Parliament or, as the case may be, to is pending, such election petition shall abate upon such person being appointed as Prime Minister or, as the case may be, being chosen to the office of the Speaker of , but such election may be called in question under any such law as is referred to in clause (1). ", "8. The fourth clause which directly concern the present appeals states that no law made by before the commencement of the Constitution (Thirty-ninth Amendment) Act, 1975, in so far as it relates to election petitions and matters connected therewith, shall apply or shall be deemed ever to have applied to or in relation to the election of any such person as is referred to in clause (1), to either House of and such election shall not be deemed to be void or ever to have become void on any ground on which such election could be declared to be void under any such law and notwithstanding any order made by any court, before such commencement, declaring such election to be void, such election to be void, such election continue to be valid in all respect and any such order and any finding on which such order is based shall be and shall be deemed always to have been void and of no effect. ", "9. The fifth clause states that any appeal or cross appeal against any such order of any court as is referred to in clause (4) pending immediately before the commencement of the Constitution (Thirty-ninth Amendment) Act, 1975, before shall be disposed of in conformity with the provisions of clause (4). ", "10. The sixth clause states that the provisions of this article shall have effect notwithstanding anything contained in the Constitution. ", "11. The third feature in the Constitution (Thirty-ninth Amendment) Act is that in the Ninth Schedule to the Constitution after Entry 86 and before the explanation several Entries Nos. 87 to 124 inclusive are inserted. The Representation of the People Act , 1951, the Representation of the People (Amendment) Act , 1974 and the Election Laws (Amendment) Act , 1975 are mentioned in Entry 87. ", "12. The respondent contends that the Representation of the People (Amendment) Act , 1974 and the Election Laws (Amendment) Act , 1975 referred to as the Amendment Act s, 1974 and 1975 do not enjoy constitutional immunity because these Acts destroy or damage basic structure or basic features. ", "13. In view of the challenge by the respondent to the constitutional validity of the Amendment Act s, 1974 and 1975, notice was given to the Attorney General. ", "14. The appeals were to be heard on August 11, 1975. In view of the Constitutional (Thirty-ninth Amendment) Act, 1975 which came into existence on August 10, 1975 the hearing was adjourned till August 25, 1975. ", "15. The constitutional validity of clause (4) of Article 329A falls for consideration. Clause (4) of Article 329A is challenged on two grounds. First, it destroys or damages the basic features or basic structure of the Constitution. Reliance is placed in support of the contention on the majority view of seven learned Judges in . ", "16. It should be stated here that the hearing has proceeded on the assumption that it is not necessary to challenge the majority view in case (supra). The contentions of the respondent are these : First, under Article 368 only general principles governing the organs of the and the basic principles can be laid down. An amendment of the Constitution does not contemplate any decision in respect of individual cases. Clause (4) of Article 329A is said to be exercise of a purely judicial power which is not included in the constituent power conferred by Article 368. ", "17. Second, the control over the result of the elections and on the question whether the election of any person is valid or invalid is vested in the under the provisions of Article 329 and Article 136. The jurisdiction of judicial determination is taken away, and, therefore, the democratic character of the Constitution is destroyed. ", "18. Third, the amendment destroys and abrogates the principle of equality. It is said that there is no rational basis for differentiation between persons holding high offices and other persons elected to . ", "19. Fourth, the rule of law is the basis for democracy and judicial review. The fourth clause makes the provisions of Part VI of the Representation of the People Act inapplicable to the election of the Prime Minister and the Speaker. ", "20. Fifth, clause (4) destroys not only judicial review but also separation of power. The order of declaring the election to be void is declared valid (sie void). The cancellation of the judgment is denial of political justice which is the basic structure of the Constitution. ", "21. The second ground is that the condition of the which passed the Constitution (Thirty-ninth Amendment) Act is illegal. It is said that a number of members of of the two s were detained by executive order after June 26, 1975. These persons were not supplied any grounds of detention or given any opportunity of making a representation against their detention. Unless the President convenes a session of the full by giving to all members thereof an opportunity to attend the session and exercise their right of speech and vote, the convening of the session will suffer from illegality and unconstitutionality and cannot be regarded as a session of the two s of . The mere fact that a person may be deprived of his right to move any court to secure his release from such illegal detention by means of a Presidential order under Article 359 does not render the detention itself either legal or constitutional. The important leaders of the have been prevented from partic ", "22. Under the first ground these are the contentions. The Constitution Amendment affects the basic structure of institutional pattern adopted by the Constitution. The basic feature of separation of powers with the role of independence of is changed by denying jurisdiction of this to test the validity of the election. The essential feature of democreacy will be destroyed if power is conceded to to declare the elections void according to law under which it has been held to be valid. This is illustrated by saying that can be law declare the election of persons against the predominant ruling party to be void. If the majority party controls the and the , the could not have any say as to whether the was properly elected. Free and fair elections are part of democratic structure and an election which has been held to be invalid for violation of the principles of free and fair elections and by commission of corrupt practices is validated ", "23. The nature of the constituent power is legislative. The constituent power cannot exercise judicial power. Exercise of judicial power or of a purely executive power is not power of amendment of the Constitution. The Constitution may be amended to change constitutional provisions but the constituent power cannot enact that a person is declared to be elected. The consequence of change of law may be that the decision given by a court under the law as it stood will not stand. ", "24. The respondent contends that judicial review is an essential feature of basic structure because of the doctrine of separation of powers for these reasons : Judicial review is basic structure in the matter of election to ensure free, fair and pure election. In the American and the Australian Constitutions the judicial power of the is located in the . There is no such provision in our Constitution. The , the and the are all treated under our Constitution with respective spheres. The are all treated under our Constitution with respective spheres. The jurisdiction of this and of High s under our Constitution is dealt with by articles under the heads of the Union and the . Under Article 136 any tribunal or court is amenable to the jurisdiction of this . The corollary drawn from this is that if under clause (4) of Article 329A of the Thirty-ninth Amendment the power of judicial review is taken away it amounts to de ", "25. In England formerly used to hear election disputes. In 1870 found that because of political factions it would be better to leave the task of deciding controverted elections to judges. delegated its power of deciding controverted elections to courts. Under the English law the courts hear and make a report to . In America each shall be the judge of the elections, returns and qualifications of its own members. That is Article 1 , Section 5 of the American Constitution. In Australia any question of a disputed election to either shall be determined by the in which the question arises. Under the German Federal Republic Constitution the decides whether a person has lost his seat. Against the decision of the an appeal shall lie to . ", "26. The view of on the American Constitution is that the power to judge elections, returns and qualification of the members of each composing the is to be lodged in the . says that no other body can be so perpetually watchful to guard its own rights and privileges from infringement. (See , page 585). ", "27. In Corpus Juris Vol. 16 (1956) it is said that the cannot exercise powers which are to be found in the other two departments of which are normally legislative or powers which are generally executive in their nature. All matters relating to or affecting elections are political question and, as such, are not questions for the . All matters relating to or affecting elections are, in the absence of controlling constitutional or statutory provisions to the contrary, political questions and, as such, are not questions for the . So, subject to express constitutional restrictions, all matters relating to the holding of elections and determining their results, including contests are political question (pp. 691, 692, 710). ", "28. In Corpus Juris Vol. 29 (1965) it is stated that under constitutional provision conferring on the the power to determine by law, before what authority, and in what manner the trial of contested elections shall be conducted, the is given broad power. A constitutional provisions authorising the to provide for the mode of contesting elections in all cases not otherwise specifically provided for in the Constitution itself confers on the adequate authority to provide for all election contests and to determine where and by what means election contests shall be conducted. The right to contest an election is not a common law right. Election belong to the political branch of the , and, in the absence of the special constitutional or statutory provisions, are beyond the control of the judicial power ( Sections 245 , ", "246). A contested election case is a proceeding in which the public is interested, since it is for the public good. An election contest is not me ", "29. In America disputed elections are decided by the . In v. held that a determination of an election contest for the office of the Governor is a political question and is not justifiable. In v. United States of America held that the manner of elections can be controlled. In v. United States of America Ex. Rel. the decision of in v. was referred to in order to find out as to what aspects of elections would be justiciable and not a political question. In v. (supra) the delimitation of constituencies was held to be a justiciable issue. In v. the exclusion of an elected representative because of his statement attacking the Vietnam policy was held to be justiciable on the ground that it was not within the jurisdiction of the to find out whether a member was sincere in ", "30. The American decisions show that if the claims additional power to disqualify a member on the ground other than those stated in the Constitution judicial review against disqualification would be available. In 's case (supra) disqualification was on an unconstitutional ground that his statement on Vietnam policy was a matter of free speech and expression. The court did not decide an election dispute but as a custodian of judicial power judged whether the was acting within its power. ", "31. itself can also hear election disputes. That was the English practice until the Grenville Act, 1868 when conferred power on courts. Before 1770, controverted elections were tried by the whole as party questions. The found that the exercise of its privilege could be submitted to a tribunal constituted by law to secure impartiality in the administration of justice according to the laws of the land. In 1868 the jurisdiction of the in the trial of controverted elections was transferred by statute to the courts of law. The present procedure is contained in the English Representation of the People Act, 1949. The trial is confided to judges selected from the . Provision is made in each case for constituting a rota from whom these judges are selected. The has no cognizance of these proceedings until their determination when the judges are to make a purpose. Trial is not a proceeding of the . The judges certify their determination, in writing, ", "32. Judicial review in many matters under statute may be excluded. In many cases special jurisdiction is created to deal with matters assigned to such authorities. A special forum is even created to hear election disputes. A right of appeal may be conferred against such decision. If acts as the forum for determination of election disputes it may be a question of parliamentary privilege and the courts may not entertain any review from such decisions. That is because the exercise of power by the in determining disputed elections may be called legislative power. A distinction arises between what can be called legislative power. A distinction arises between what can be called the traditional judicial determination by courts and tribunals on the one hand and the peculiar jurisdiction by the in determining controverted elections on the other. ", "33. The legal order is a system of general and individual norms connected with each other according to the principle that law regulates its own creation. Each norm of this order is created according to the provisions of another norm and ultimately according to the provisions of the basic norm constituting the unity of this system, the legal order. A norm belongs to a certain legal order, because it is created by an organ of the legal community constituted by this order. Creation of law is application of law. The creation of a legal norm is normally an application of the higher norm, regulating its creation. The application of higher norm is the creation of lower norm determined by the higher norm. A judicial decision is an act by which a general norm, a statute, is applied but at the same time an individual norm is created binding one or both parties to the conflict. Legislation is creation of law. Taking it into account is applicable of law. The higher norm may determine the organ and the procedure by which ", "34. The general norm which attaches abstractly determined consequences, has to be applied to concrete cases in order that the sanction determined in abstract may be ordered and executed in concrete. The two essential elements of judicial functions are to apply a pre-existing general norm in which a certain consequence is attached to certain conditions. The existence of the concrete conditions in connection with the concrete consequence are what may be called individualization of the general and abstract norm to the individual norm of the judicial decision. ", "35. The contention is that constitutent power is an exercise in legislative process. The constituent power, it is said, can exercise legislative as well as judicial and executive powers. It is said that if a legislation can validate a matter declared invalid by a judgement the constituent power may equally do so. Special emphasis is laid on Article 102(1) (e) of the Constitution which is amended by the Constitution (Thirty-ninth Amendment) Act. Article 102(1) (e) speaks of disqualification by certain laws. The constitutional amendment seeks to amended Article 102 and remove the disqualification in the case of the Prime Minister and the Speaker. Reliance was placed on the decisions in v. and v. King Emperor, that an amendment is supportable to invalidate a judgment. ", "36. 's case (supra) is an authority for the proposition that the legal infirmity can be removed and active indemnity can be passed to relieve from penalties incurred. ", "37. In case (supra) the Special Criminal Courts (Repeal) Ordinance, 1943 which conferred validity and full effectiveness on sentences passed by special courts which functioned under the Special Criminal Courts Ordinance, 1942 was challenged. It was argued in case that the 1943 Ordinance attempted to exercise judicial power. did not accept the contention on the ground that in India the has enacted laws providing that suits which had been dismissed on a particular view of the law must be restored and retried. said that simply takes up certain determinations which exist in fact, though made without authority, and prescribes not that they shall be acts done by a board of review, but that they shall be treated as they would be treated if they were such acts. The sections do not constitute an exercise of the judicial power. The had not attempted to decide the question of the guilt or innocence of any of the accused ", "38. The power of the to validate matters which have been found by judgments or orders of competent courts and tribunals to be invalid or illegal is a well-known pattern. The validates acts and things done by which the basis of judgments or orders of competent courts and tribunals is changed and the judgments and orders are made ineffective. All the sales tax validation cases, the election validation cases are illustrations of that proposition. The present appeals are not of the type of providing indemnity against penalties or determining existing facts to be treated in accordance with change of law. ", "39. The effect of validation is to change the law so as to alter the basis of any judgment, which might have been given on the basis of old law and thus make the judgment ineffective. A formal declaration that the judgment rendered under the old Act is void, is not necessary. If the matter is pending in appeal, the appellate Court has to give effect to the altered law and reverse the judgment. The rendering of a judgment ineffective by changing its basis by legislative enactment is not an encroachment on judicial power but a legislation within the competence of the rendering the basis of the judgment non est. If a competent court has found that a particular tax or levy has been imposed by a law, which is void because the passing the law was not competent to pass the law, then the competent has validated the tax or levy by a validation Act involving a re-enactment of the invalid law. Where the competent has passed a law which is contrary to any of the fundamenta ", "40. Where invalid elections declared by reason of corrupt practices have been validated by changing the definition of corrupt practices in the Representation of the People Act , 1951 retrospectively the original judgment is rendered ineffective. ( ). ", "41. in , dealt with the validity and effect of Ordinance No. 3 of 1944. One of the objects of that ordinance was to enact a presumption in the ordinance itself in favour of detention orders to preclude their being questioned in courts of law and to take away or limit the power of to make orders under Section 491 of the Criminal Procedure Code. The third object of the ordinance was challenged on the ground that Section 10(2) of the ordinance which provided that if at the commencement there is pending in any court any proceeding by which the validity of an order having effect by virtue of Section 6 as if it had been made under this ordinance is called in question, that proceeding is hereby discharged. Section 10(2) of the ordinance was challenged on the ground that this was in abrogation of judicial power by legislative authority. It was said that the legislative authority only passed the law and the disposal of the particular case could rem ", "42. on behalf of the respondent contended that the constituent power could deal with amendments of the Constitution, but could not exercise constituent power in relation to validating an election. ", "43. Judicial review is one of the distinctive features of the American Constitutional Law. In America equal protection of the laws is based on the concept of due process of law. These features are not in our Constitution. ", "44. In 's case (supra) the claimed additional power to disqualify a member on grounds other than those stated in the Constitution. It was conceded there as it will appear at page 244 of the report that judicial review against the disqualification decreed by the would be available if a member was excluded on racial ground or other unconstitutional grounds. The claimed that the ground on which was disqualified was not an unconstitutional ground. The court held that there was no distinction between a disqualification decreed by the on racial grounds and one alleged to violate the right of free speech. The court concluded that was deprived of his constitutional rights guaranteed by the First Amendment by the disqualification decreed by the . This was not a case of deciding an election dispute by the and the court sitting on appeal on the decision of the . This is a case where a disqualification was imposed on unconstitutional grounds, thereby affecting the fu ", "45. The case of v. (supra) is also one of disqualification by the of a Congressman on the basis of qualification which the added to those specified in the Constitution. In other words, the purported to unseat a member by disqualifying him on a ground not given in the Constitution. This was not a case of deciding an election dispute. Under the statute in question had jurisdiction over all civil actions where controversy arises under the Constitution. This was a case entertained on the ground that exclusion of a member of the was unconstitutional. This case is an authority for the proposition that if a power is committed to a particular organ, the court cannot adjudicate upon it. Where a power is exercised by one organ, which is not committed to that particular organ of the and such exercise of power is violative of a constitutional provision the mater becomes cognizable by courts. The held that a question of unconstitutional exclu ", "46. Judicial review is not to be founded on any article similar to the American Constitution. In the Australian Constitution also the judicial power is located in the court. The doctrine of separation of powers is carried into effect in countries like America, Australia. In our Constitution there is separation of powers in a broad sense. But the larger question is whether there is any doctrine of separation of powers when it comes to exercise of constituent power. The doctrine of separation of powers as recognised in America is not applicable to our country. (See In re Delhi Laws Act ; ; v. State of U. P.; and .) ", "47. The rigid separation of powers as under the American Constitution or under the Australian Constitution does not apply to our country. Many powers which are strictly judicial have been excluded from the purview of the courts. The whole subject of election has been left to courts traditionally under the Common Law and election disputes and matters are governed by the . The question of the determination of election disputes has particularly been regarded as a special privilege of in England. It is political question in the United States. Under our Constitution has inherited all the privileges, powers and immunities of the British . In the case of election disputes has defined the procedure by law. It can at any time change that procedure and take over itself the whole question. There is, therefore, no question of any separation of powers being involved in matters concerning elections and election petitions. ", "48. When the constituent power exercises powers the constituent power comprises legislative, executive and judicial powers. All powers flow from the constituent power through the Constitution to the various departments or heads. In the hands of the constituent authority there is no demarcation of powers. It is only when the constituent authority defines the authorities or demarcates the areas that separation of power is discussed. The constituent power is independent of the doctrine of separation of powers. The constituent power is sovereign. It is the power which creates the organs and distributes the powers. ", "49. The constituent power is sui generis. It is different from legislative power. The position of unlimited law-making power is the criterion of legal sovereignty. The constituent power is sovereign because the Constitution flows from the constituent power. ", "50. In Article 329A an exercise of judicial power is the question for determination. In legislative processes there may be judicial process. If the has to fix the amount or lay down the principle for fixation of amount the question will arise as to whether this is exercise of judicial power. The determination of the amount will involve judicial procedure. When the determines the amount the fixation of amount is purely by legislative process. But in doing so the takes into account factors relevant to individual properties. ", "51. Every organ of the has to ascertain facts which make the foundation of its own decision. The usually collects its materials through its departments. The acts in a field where there are two or more parties before it and upon evidence placed before it pronounces its verdict according to principles of natural justice. The is entitled to obtain information from any source. The may call witnesses. The rule of audi alteram partem is not applicable in a legislative process. Legislation is usually general. It may sometimes be for special reasons an individual case. There is no doubt that the constituent power is not the same as legislative power. The distinction between constituent power and legislative power is always to be borne in mind because the constituent power is higher in norm. ", "52. Judicial review in election disputes is not a compulsion. Judicial review of decisions in election disputes may be entrusted by law to a judicial tribunal. If it is to a tribunal or to the judicial review will be attracted either under the relevant law providing for appeal to this or Article 136 may be attracted. Under Article 329 (b) the contemplated law may vest the power to entertain election petitions in the itself which may determine the dispute by a resolution after receiving a report from a special committee. In such cases judicial review may be eliminated without involving amendment of the Constitution. The Constitution permits by amendment exclusion of judicial review of a matter if it is necessary to give effect to the directive principles of policy. A similar power may be available when such exclusion is needed in the larger interest of the security of the . In either case the exclusion of judicial review does not mean that principles of equality are viola ", "53. Equality of status as well as equality of opportunity is a fundamental right in Articles 14 and 16 of the Constitution. It also means equality before law and equal protection of the laws. Equality is spoken in the Preamble. There is liberty to to classify to establish equality. When Articles 31A and 31B eliminated judicial review the meaning was not that the would go on discriminating. The task of classification can be left to the . It is the very nature of legislation that classification must be in public interest. The amending body has excluded judicial review in Articles 31A, 31B and 31C. ", "54. Exclusion of the operation of the equality principle from some fields is constitutionally possible. Article 33 excludes judicial review in matters relating to the armed forces. Article 262(2) excludes jurisdiction of courts in water disputes. ", "55. Decision in election disputes may be made by the itself or may be made by courts or tribunals on behalf of the or may be made by courts and tribunals on their own exercising judicial functions. The concept of free and fair election is worked out by the Representation of the People Act . The Act provides a definition of \"corrupt practice\" for the guidance of the court. In making the law the acts on the concept of free and fair election. In any legislation relating to the validity of elections the concept of free and fair elections is an important consideration. In the process of election the concept of free and fair election is worked out by formulating the principles of franchise, and the free exercise of franchise. In cases of disputes as to election, the concept of free and fair election means that disputes are fairly and justly decided. Electoral offenses are statutory ones. It is not possible to hold that the concept of free and fair election is a basic structure, a ", "56. Clause (4) in Article 329A has done four things. First, it has wiped out not merely the judgment but also the election petition and the law relating thereto. Secondly, it has deprived the right to raise a dispute about the validity of the election by not having provided another forum. Third, there is no judgment to deal with and no right or dispute to adjudicate upon. Fourth, the constituent power of its own legislative judgment has validated the election. ", "57. At the outset it has to be noticed that constituent power is not the same as ordinary law-making power. On behalf of the appellant it was rightly contended that if any amendment of Article 102(1) (e) of the Constitution had to be made, it had to be made by amendment of the Constitution. The matter does not rest there. ", "58. If no law prior to the Constitution (Thirty-ninth Amendment) Act will apply to election petitions or matters connected therewith the result is that there is not only no forum for adjudication of election disputes but that there is also no election petition in the eye of law. The insurmountable difficulty is in regard to the process and result of validating the election by clause (4). Two answers were given on behalf of the appellant. One was that the validation of the election is itself the law. The other was that the constituent power applied its own norms to the election petition. Both the answers are unacceptable. If the election petition itself did not have any existence in law there was no petition which could be looked into by the constituent power. If there was no petition to look into it is difficult to comprehend as to what norms were applied to the election dispute. The dispute has to be seen. The dispute has to be adjudicated upon. ", "59. Clause (4) suffers from these infirmities. First, the forum might be changed but another forum has to be created. If the constituent power became itself the forum to decide the disputes the constituent power by repealing the law in relation to election petitions and matters connected therewith did not have any petition to seize upon to deal with the same. Secondly, any decision is to be made in accordance with law. has power to create law and apply the same. In the present case, the constitutent power did not have any law to apply to the case, because the previous law did not apply and no other law was applied by clause (4). The validation of the election in the present case is, therefore, not by applying any law and it, therefore, offends rule of law. ", "60. It is true that no express mention is made in our Constitution of vesting the the judicial power as is to be found in the American Constitution. But a division of the three main functions of is recognised in our Constitution. Judicial power in the sense of the judicial power of the is vested in the . Similarly, the and the are vested with powers in their spheres. Judicial power has lain in the hands of the prior to the Constitution and also since the Constitution. It is not the intention that the powers of the should be passed to or be shared by the or the or that the powers of the or the should pass to or be shared by the . ", "61. The constituent power is sovereign. Law-making power is subject to the Constitution. may create forum to hear election disputes. may itself hear election disputes. Whichever body will hear election disputes will have to apply norms. Norms are legal standards. There is no discrimination if classification on rational basis is made for determination of disputes relating to persons holding the office of Prime Minister or the Speaker. The changes effected by the Amendment Act s, 1974 and 1975 apply to all and there is no discrimination. Retrospective legislation is not by itself discrimination. The changes introduced to the 1951 Act apply to all. ", "62. Clause (4) of Article 329A in the present case in validating the election has passed a declaratory judgment and not a law. The legislative judgment in Clause (4) is an exercise of judicial power. The constituent power can exercise judicial power but it has to apply law. ", "63. The validation of the election is not by applying legal norms. Nor can it be said that the validation of election in Clause (4) is by norms set up by the constituent power. ", "64. Clause (5) in Article 329A states that an appeal against any order of any court referred to in Clause (4) pending, before the commencement of the Constitution (Thirty-ninth Amendment) Act, before , shall be disposed of in conformity with the provisions of Clause (4). The appeal cannot be disposed of in conformity with the provisions of Clause 4 inasmuch as the validation of the election cannot rest on Clause (4). ", "65. In view of the conclusion that the appeal cannot be disposed of in conformity with Clause (4), it is necessary to hear the appeals on other grounds in accordance with the provisions of the 1951 Act and the Amendment Act s, 1974 and 1975. ", "66. The second contention of the respondent is that the session of and is invalid for these reasons. If the illegally and unconstitutionally detains any person the detention affects the validity of the proceedings. A number of members of of the two Houses, namely, and were detained by executive orders after June 26, 1975 and before the summoning of a session of the two Houses of . commenced the session on July 21, 1975. None of the members of were either supplied any grounds of detention or given any opportunity to make any representation against their detention. The President who was the authority to summon a session of issued the Presidential Order under Article 359 of the Constitution on June 27, 1975. The right of the detained members of to move any court for the enforcement of their fundamental right under Article 22 of the Constitution was taken away by the executive or ", "67. The constitutional position of the two is governed by the provisions of Articles 79 and 81 of the Constitution. The respondent contends that unless the President convenes a session of the full by giving to all members thereof an opportunity to attend the session and exercise their right of speech and vote, the convening of the session will suffer from illegality and unconstitutionality and cannot be regarded as a session of the two . Any business transacted in a session of such truncated cannot, therefore, be regarded in law as a session of a . ", "68. The mere fact that a person who is under unconstitutional and illegal detention may be deprived of his right to move a court to secure his release from such illegal detention by means of a Parliament Order under Article 359 is said by the respondent not to render the detention of a person either legal or constitutional, and, therefore, such a detenu must be provided an opportunity to participate in the proceedings of the . It is emphasised by the respondent that when important leaders of different parties are unconstitutionally prevented from participating in the session of the , a session cannot be held for deliberations in which different members influence the view of others by their own participation. If in the holding of a session and in transacting business therein, the provisions of the Constitution are not complied with, this is said to amount to illegality or unconstitutionality and not a mere procedural irregularity within the meaning of Article 122(1) of the Constitution. ", "69. The essence of the respondent's contention is that the right of participation of some members of in the proceedings of in the proceedings of under Article 105(3) of the Constitution has been interfered with. When a member is excluded from participating in the proceedings of the , that is a matter concerning and the grievance of exclusion is in regard to proceedings within the walls of . In regard to rights to be exercised within the walls of the the itself is the judges. (See : May's ary Practice, 18th Ed., pp. 82-83, 12 QBD 271, 285-286). ", "70. In v. claimed to make affirmation instead of taking the oath. He was permitted to make the affirmation \"subject to any liability by statute\", and took his seat. Upon an action for penalties it was decided, finally by , that had not qualified himself to sit by making the affirmation. On re-election, he attempted to take the oath, but was prevented by order of the which eventually directed the Sergeant to exclude him from the until he undertook to create no further disturbance. then brought an action against the Sergeant in order to obtain a \"declaration that the order of the was beyond the power and jurisdiction of the and void, and an order restraining from preventing by force from entering the \" ", ". It was held that the had no power to restrain the executive officer of the from carrying out the order of the . The reason is that the is not subject to the contro ", "71. If an outside agency illegally prevents a member's participation the has the power to secure his presence. In 1543 a member was arrested in London. The , on hearing of his arrest, ordered the Sergeant to go to the Computer and demand his delivery. The Sergeant was resisted by the city officers, who were protected by the sheriffs. The commons laid their case before the Lords. They ordered the Sergeant to repair to the sheriffs, and to require the delivery of without any writ or warrant. The Lord Chancellor had offered them a writ of privilege but they refused it. The sheriffs in the meantime had surrendered the prisoner. This practice of releasing members by a writ of privilege continued but no writ was to be obtained. ", "72. The present mode of releasing arrested members goes back to 's case. In 1603 was imprisoned in the Fleet, in execution, before the meeting of . The first tried to bring him into the by habeas corpus, and then sent the Sergeant to demand his release. The warden refused to give up his prisoner. At length the warden delivered up the prisoner. ", "73. An Act 1 James 1, c. 13 was passed, which while it recognised the privilege of freedom from arrest, the right of either House of to set a privileged person at liberty, and the right to punish those who make or procure arrests, enacted that after such time as the privilege of that session in which privilege is granted shall cease, parties may sue and execute a new writ. In 1700 an Act was passed which while it maintained the privilege of freedom from arrest with more distinctness than the Act I James 1 c. 13, made the goods of privileged persons liable to distress infinite and sequestration, between a dissolution or prorogation and the next meeting of , and during adjournments for more than fourteen days. ", "74. The composition of is not dependent on inability of a member to attend for whatsoever reason. The purpose of Article 85 is to give effect to the collective right of the which represents the nation to be called as often as the situation demands, and in any case the interval between two sessions must not exceed six months. Assuming a conflict were to arise between the privileges of a member under Article 105(3) and the functions of the to assemble under Article 85 the privilege of the member will not prevail. The detention of members of is by a statutory authority in the exercise of his statutory powers. ", "75. The suspension under Article 359 of the remedy for the enforcement of fundamental rights is dependent on a Proclamation of Emergency under Article 352. has the power not to approve of the Proclamation, and thereafter the emergency shall cease to operate. The contention of the respondent means that cannot meet even so as to withhold approval of the emergency and thus terminate the suspension of the members' right of moving the court. The Constitution provides for proclamation of emergency, the suspension of the remedy under Article 359 for enforcement of fundamental rights enabling even detention of members of when necessary. Article 85 is not suspended. The six months rule is obligatory. It follows that the members' right under Article 105 are not available under a detention in these circumstances. For the purposes of Article 105(3) a conviction under penal laws or detention under emergency laws must be deemed to be valid till it is set aside. ", "76. When under Article 359 the President during the operation of a Proclamation of Emergency by order declares that the right to move any court for the enforcement of rights conferred by Part III shall remain suspended and persons who are members of are in detention under orders made under the Maintenance of Internal Security Act, the detention cannot be challenged by collateral attack on the ground of deprivation of their participation in the parliamentary proceedings. The challenge will be questioning the detention on the ground that the detention is in violation of Article 19 , 21 and 22. ", "77. Article 85 provides that not more than six months shall intervene between the two sessions of . Article 85 is not a provision regarding the constitution of but of holding of sessions. The powers, privileges and immunities of and its members as provided in Article 105 are that they shall be such as may be defined by by law, and, until so defined, shall be those of of the of the United Kingdom. ", "78. In Special Reference No. 1 of 1964, it was held that the court could entertain a petition under Article 226 on the ground that the imposition of penalty by the on a person who is not a member of the or issuing process against such person for its contempt committed outside the four walls of the . ", "79. The scope of the ary privilege of freedom from arrest has been defined positively and negatively. The positive aspect of the privilege is expressed in the claim of the to freedom from arrest in all civil actions or suits during the time of and during the period when a member was journeying or returning from . The privilege has been defined negatively in the claim of the which specifically excepted treason, felony and breach or surety of the peace. ", "80. The privilege of freedom from arrest is limited to civil cause, and has not been allowed to interfere with the administration of criminal justice or emergency legislation. (See May's Parliamentary Practice, 18th Ed., at p. 100). In early times the distinction between \"civil\" and \"Criminal\" was not clearly expressed. The development of the privilege has shown a tendency to confine it more narrowly to cases of a civil character and to exclude not only every kind of criminal case, but also cases which, while not strictly criminal, partake more of a criminal than of a civil character. This development is in conformity with he principle laid down by the in a conference with the in 1641 : ", "\"Privilege of is granted in regard of service of the and is not to be used to the danger of the .\" ", "81. In ' case, it was resolved by both Houses on November 29, 1763 that the privilege of does not extend to the case of writing and publishing seditious libels, nor ought to be allowed to obstruct the ordinary course of the laws in the speedy and effectual prosecution of so heinous and dangerous an offence.\"Since that time\", said in 1831, \"it has been considered as established generally, that privilege is not claimable for any indictable offence.\" ", "82. These being the general declarations of the law of , the will not allow even the sanctuary of its walls to protect a member from the process of criminal law, although a service of a criminal process on a member within the precincts of , whilst the is sitting without obtaining the leave of the , would be a breach of privilege. ", "83. The committal of a member in England for high treason or any criminal offence is brought before the by a letter addressed to the Speaker by the committing judge or magistrate. Where a member is convicted but released on bail pending an appeal, the duty of the Magistrate to communicate with the Speaker does not arise. No duty of informing the Speaker arises in the case of a person who while in prison under sentence of a court is elected as a member of . In the case of detention of members under Regulation 14B of the Defence of Realm Regulations in England, the communication was made to the Speaker by a letter from the Chief Secretary to the Lord Lieutenant of Ireland which was read to the by the Speaker. The detention of a member under Regulation 18B of the Defence (General) Regulations, 1939, made under the Emergency Powers (Defence) Acts, 1939 and 1940, led to being directed to consider whether such detention constituted a breach of the privileges of the ", "84. , the petitioner who were members of and detained by orders passed by under Rule 30 (1) (b) of the Defence of India Rules, 1962 challenged the validity of the orders of detention on the ground that Rule 30(1) (b) was not valid because \"a legislator cannot be detained so as to prevent him from exercising his constitutional rights as such legislator while the legislative chamber to which he belongs is in session\" ", ". The raised a preliminary objection that the petitions were incompetent in view of the order issued by the President under Article 359(1) suspending the rights of any person to move any court for the enforcement of rights conferred by Articles 14, 21 and 22. This Court held that the validity of the Act, rule or order made under the Presidential Order could not be questioned on the ground that they contravene Articles 14, 21 and 22. ", "85. The petitioners also contended in 's case (supra) that Rule 30(1) (b) under which the orders of detention had been passed was invalid on grounds other than those based on Articles 14, 19, 21 and 22. This Court held that if that plea was well-founded, the last clause of the Presidential Order was not satisfied, and, therefore, the bar created by it suspending the citizen's fundamental rights under Articles 14, 21 and 22 could not be pressed into service by the respondents. ", "86. Articles 79, 85, 86, 100(1) and 105(3) were considered in 's case (Supra) in relation to rights of members of , and it was held that the totality of rights cannot claim the status of fundamental rights and freedom of speech on which reliance was placed is a part of the privileges falling under Article 105. The reason is that freedom from arrest under a detention order is not recognised as a privilege which can be claimed by members of in England. This Court then posed the question that if a claim for freedom from arrest by a detention order could not be sustained under the privileges of the members of whether it could be sustained on the ground that it is a constitutional right which could not be sustained on the ground that it is constitutional right which could not be contravened. The statement in May's ary Practice 7th Ed. at p. 78 which is to be found in the 18th Edition at p. 100 that the privilege of freedom from arrest is limited to civil caus ", "87. The second ground of challenge that there was no valid session of the cannot be accepted for the reasons given above. It has also to be stated that it is not open to the respondent to challenge the orders of detention collaterally. The principle is that what is directly forbidden cannot be indirectly achieved. ", "88. found first that the appellant has to be regarded as a candidate from December 29, 1970 as she held herself out on that date as a candidate. The second finding is that the appellant obtained and procured the assistance of for the furtherance of her election prospects when was serving as a gazetted officer with . found that 's resignation from his service though submitted on January 13, 1971 did not become effective until January 25, 1971 when it was notified. The further finding by is that under the instructions of the appellant delivered election speech on January 7, 1971 at Munshi Ganj and another speech at Kalan on January 19, 1971. The third finding by is that the appellant and her election agent procured and obtained the assistance of the officers of the State Government, particularly, the District Magistrate, the Superintendent of Police, the Execut ", "89. The definition of \"candidate\" in Section 79(b) of the 1951 Act until the amendment thereof by the Election Laws (Amendment) Act , 1975 was as follow : ", "'Candidate' means a person who has been or claims to have been duly nominated as a candidate at any election and any such person shall be deemed to have been a candidate as from the time when, with the election in prospect, he began to hold himself out as a prospective candidate. ", "90. This definition has now been substituted by Section 7 of the Amendment Act, 1975, as follows : ", "'Candidate' means a person who has been or claims to have been duly nominated as a candidate at any election. ", "91. Section 10 of the Amendment Act, 1975 further enacted that the amendments shall have retrospective operation so as to apply to and in relation to any election held before the commencement of the Amendment Act , 1975 on August 6, 1975 to either or to either or the of the Legislature of a State, inter alia, (iv) in respect of which appeal from any order of made in any election petition under Section 98 or Section 99 of the 1951 Act is pending before immediately before such commencement. ", "92. Section 9 of the Amendment Act, 1975 has substituted clause (a) in Section 171 A of the Indian Penal Code and a \"candidate\" means for the purpose of Section 171A of the Indian Penal Code a person who has been nominated as a candidate at any election. Previously the definition of \"candidate\" in Section 171A of the Indian Penal Code was the same as in Section 79(b) of the 1951 Act prior to the amendment thereof by the Amendment Act , 1975. In Section 171A of the Indian Penal Code there was a proviso to the effect that candidate would mean a person who holds himself out as a prospective candidate provided he is subsequently nominated as a candidate. ", "93. Relying on the provisions introduced by the Amendment Act , 1975, it is contended on behalf of the appellant that she will be regarded as a candidate only from February 1, 1971, namely, the date when she has been duly nominated as a candidate at her election, and, therefore, the finding of cannot be sustained. It is also contended by the appellant that the finding of that delivered election speeches on January 7, 1971 and January 19, 1971 under instructions of the appellant cannot be supported because the appellant was not a candidate either on January 7, 1971 or on January 19, 1971. ", "94. The second finding by with regard to the resignation of not to be effective until January 25, 1971 is contended to be displaced by legislative change by the Amendment Act , 1975. Section 8(b) of the Amendment Act, 1975 has introduced Explanation (3) at the end of Section 123(7) of the 1951 Act. This amendment has retrospective operation. ", "95. The Explanation is as follows : ", "\"(3) For the purposes of clause (7), notwithstanding anything contained in any other law, the publication in the Official Gazette of the appointment, resignation, termination of service, dismissal or removal from service of a person in the service of (including a person serving in connection with the administration of a Union territory) or of a State Government shall be conclusive proof - ", "(i) of such appointment, resignation, termination of service, dismissal or removal from service, as the case may be, and ", "(ii) where the date of taking effect of such appointment, resignation, termination of service, dismissal or removal from service, as the case may be, is stated in such publication, also of the fact that such person was appointed with effect from the said date, or in the case of resignation, termination of service, dismissal or removal from service, such person ceased to be in such service with effect from the said date.\" ", "96. The effect of Explanation (3) at the end of Section 123(7) of the 1951 Act incorporated by the notification dated January 25, 1971 in the Gazette dated February 6, 1971 makes the fact of the resignation of from his service fully effective from January 14, 1971. It is, therefore, contended that from January 14, 1971 was not a government servant. ", "97. To constitute a corrupt practice within the meaning of Section 123 (7) of the 1951 Act the act complained of must be an act of obtaining or procuring os assistance of the categories of government servants mentioned therein by the candidate or his election agent or by any other person with the consent of the candidate or his election agent. Section 100(1) (b) of the 1951 Act enacts that if is of opinion that any corrupt practice has been committed by a returned candidate or his election agent or by any other person with the consent of a returned candidate or his election agent, shall declare the election of the returned candidate to be void. A returned candidate is defined in Section 79(f) of the 1951 Act to mean a candidate whose name has been published under Section 67 of the 1951 Act as duly elected. A returned candidate in order to be guilty of a corrupt practice within the meaning of Section 123(7) of the 1951 Act must be guilty of any of the acts mentioned in the differ ", "98. The third finding by that the appellant and her election agent procured and obtained the assistance of the officers of , particularly, the District Magistrate, the Superintendent of Police, the Executive Engineer, and the Engineer to for construction of rostrums and arrangement for supply of power for construction of rostrums and arrangement for supply of power for loudspeakers and for their assistance for furtherance of the prospects of the election of the appellant has to be tested in the light of the provisions contained in Section 123(7) of the 1951 Act. Under the said provision obtaining or procuring by candidate or his agent any assistance for the furtherance of the prospect of that candidate from gazetted officers is corrupt practice. The Amendment Act , 1975 by Section 8 thereof has added a proviso to Section 123(7) of the 1951 Act. The proviso is as follows : ", "\"Provided that where any person, in the service of the Government and belonging to any of the classes aforesaid, in the discharge or purported discharge of his official duty, makes any arrangements or provides any facilities or does any other act or thing, for, to, or in relation to any candidate or his agent or any other person acting with the consent of the candidate or his election agent, (whether by reason of the office held by the candidate or for other reason), such arrangements, facilities or act or thing shall not be deemed to be assistance for the furtherance of the prospects of that candidate's election.\" ", "99. The proviso aforesaid shows that where persons in the service of the in the discharge of official duty make any arrangement or provide any facility or do any act or thing in relation to a candidate, such arrangements and facilities shall not be deemed to be assistance for furtherance of the prospect of the candidate's election. Therefore, the service rendered by government servants for construction of rostrums and arrangements for supply of power for loudspeakers according to the contention of the appellant could not be considered as assistance for the furtherance of the prospects of the election of the appellant. ", "100. The contentions of the appellant can succeed if the Amendment Act s of 1974 and 1975 are valid. The respondent has challenged the constitutional validity of these Acts. Therefore, that question has to be examined before the appellant's contentions can be answered. ", "101. The respondent in cross-appeal challenged the findings of on issue No. 9 and contended that should have held that the election expenses of the appellant exceeded the limit. The respondent also challenged the finding of with regard to issue No. 6 and contended that the high Court should have held that the symbol of cow and calf was a religious symbol and the appellant committed corrupt practice as defined in Section 123(3) of the 1951 Act. The respondent did not press issues No. 4 and 5 which related to distribution of quilts, blankets, dhotis and liquor. The respondent also abandoned issue No. 7 which related to voters being conveyed to the polling stations free of charge on vehicles hired and procured by . ", "102. The issue pressed by the respondent was that the appellant and her election agent incurred or authorised expenditure in excess of the amount prescribed by Section 77 of the 1951 Act read with Rule 90. The respondent alleged that the election expenses of the appellant, inter alia, were Rs. 1, 28, 700 on account of hiring charges of vehicles, Rs. 43, 230 on account of cost of petrol and diesel; Rs. 9, 900 on account payments made to the drivers of the vehicles. The respondent further alleged that the appellant spent Rs. 1, 32, 000 on account of construction of rostrums for public meetings on February 1, 1971 and February 25, 1971. The respondent contended that the findings of should be reversed. ", "103. found that the election expenses furnished by the appellant were Rs. 12, 892.97. added another sum of Rs. 18, 183.50. The three items which were added by were cost of erection of rostrums amounting to Rs. 16, 000, cost incurred in installation of loudspeakers amounting to Rs. 1, 951 and cost for providing car transport to respondent No. 1 amounting to Rs. 232.50. The total election expenses found by came to Rs. 31, 976.47 which was below the prescribed limit of Rs. 35, 000. ", "104. With regard to hiring charges of vehicles found that the respondent did not examine any witness to indicate as to whether the vehicles were used only for party propaganda or they were used in connection with the election of the appellant. further found that the documents which were relied on by the respondent did not establish that the vehicles had been engaged or used in connection with the election work of the appellant. ", "105. The respondent repeated the following contentions which had been advanced before . , President, wrote a letter to the District Election Officer intimating that 23 vehicles had been engaged by the for election work in Rae Bareli, Amethi and Ram Sanehi Ghat constituencies, and, therefore, the vehicles should be derequisitioned. thereafter wrote a note to and requested that the letter be sent to the District Election Officer to that effect. wrote a letter to the District Election Officer and repeated the prayer contained in 's letter. It was, therefore, contended that because was the election agent of the appellant and he moved for the derequisition of the vehicles it should be inferred that the vehicles were engaged for the election of the appellant. said that the vehicles were used in the three parliamentary constituencies. The Hi ", "106. With regard to the expenses for the election of rostrums the respondent contended that the appellant's election expenses should include Rs. 1, 32, 000 as the costs for erection of rostrums for the meetings on February 1, 1971 and the meeting on February 25, 1971. held that Rs. 16, 000 could only be added to the election expenses of the appellant consisting of Rs. 6, 400 for four rostrums and Rs. 9, 600 for six rostrums. ", "107. The amount of Rs. 16, 000 which was added by on account of cost of erection of rostrums cannot be included in the election expenses of the appellant by reason of amendment to Section 77 of the 1951 Act by the Amendment Act , 1975. Explanation 3 has been added as follows : ", "\"For the removal of doubts, it is hereby declared that any expenditure incurred in respect of any arrangements made, facilities provided or any other act or thing done by any person in the service of the Government and belonging to any of the classes mentioned in clause (7) of Section 123 in the discharge or purported discharge of his official duty as mentioned in the proviso to that clause shall not be deemed to be expenditure in connection with the election incurred or authorised by a candidate or by his election agent for the purposes of this sub-section.\" ", "108. By the Amendment Act , 1975 a proviso has been added to Section 123(7) of the 1951 Act to the effect that arrangements made or facilities provided or any act done by a government servant belonging to the class mentioned there in the discharge of official duty shall not be deemed to be assistance for furtherance of the prospects of that candidate's election. All these amendments have retrospective operation. Therefore, the cost of rostrums cannot be added to the election expenses of the appellant. Services rendered by government servants for the erection of rostrums and for supply of power for loudspeakers cannot be deemed to be assistance for the furtherance of the prospects of that candidate's election. ", "109. The respondent contended that Exhibit 118 which was the bank account of showed on the one hand that there was deposit of Rs. 69, 930 on March 4, 1971 and on the other there was a withdrawal of Rs. 40, 000 on March 4, 1971 and of Rs. 25, 000 on March 6, 1971, and, therefore, the sum of Rs. 65, 000 should be added to the election expenses of the appellant. When it was put to that the sums of Rs. 40, 000 and Rs. 25, 000 were withdrawn by , said that he was not aware of it. There is no pleading in the election petition that the appellant authorised incurring expenditure by a political party. There is no pleading that any amount has been paid by the political party. There is no complaint in the petition about the sum of Rs. 65, 000 or the sum of Rs. 69, 930. denied knowledge of Rs. 70, 000. The appellant was not asked a single question. There is no evidence to identify any of these payments with the election of the appellant. ", "110. It is appropriate at this stage to refer to the amendment which was introduced by the Amendment Act , 1974. The appellant relies on the provision to show that expenses incurred or authorised by a political party cannot be included in election expenses. Explanation 1 which was inserted at the end of Section 77 of the 1951 Act by Amendment Act , 1974 is that any expenditure incurred or authorised in connection with the election of a candidate by a political party or by any other association or body of persons or by an individual other than the candidate or his election agent shall not be deemed to be and shall not ever be deemed to have been expenditure in connection with the election incurred or authorised by the candidate or by his election agent. ", "111. A proviso was also added to the aforesaid Explanation 1 by the Amendment Act , 1974. The proviso stated that nothing contained in the Explanation shall effect (a) any Judgment, order or decision of whereby the election of a candidate to or to State has been declared void or set aside before the commencement of the Representation of the People (Amendment) Ordinance, 1974; (b) any Judgment, order or decision of whereby the election of any such candidate has been declared void or set aside before the commencement of the said Ordinance if no appeal has been preferred to against such judgment, order or decision of the High court before such commencement and the period of limitation for filing such appeal has expired before such commencement. ", "112. Explanation 2 which was added to Section 77 of the 1951 act by the Amendment Act , 1974 is as follows : ", "For the purposes of Explanation 1 \"political party\" shall have the same meaning as in the Election Symbols (Reservation and Allotment) order, 1968, as for the time being in force. ", "113. Counsel for the respondent relied on the recent decision of this Court in in support of the proposition that there has been no change in law and if expenses incurred by a political party can be identified with the election of a candidate then that expenditure is to be added to the election expenses of a candidate as being authorised by him. There are no findings by in the present appeals that any expenses by a political party were authorised by the appellant. There is also no finding in the present appeals that any expenses incurred by a political party can be identified with the election of the appellant. The changes in law affected by the Amendment Act s, 1974 and 1975 totally repel the submissions on behalf of the respondent. Expenses incurred or authorised in connection with the election of a candidate by a political party shall not be deemed to be and shall not ever be deemed to have been expenditure in connection with the election incurred or autho ", "114. Counsel for the respondent contended that the judgment of the High court should be reversed with regard to election expenses of the appellant on three counts. First, Exhibit 118 shows that the sum of Rs. 65, 000 which was drawn by should have been held by on a reasonable inference to have been spent by the District as having been authorised by the election agent of the appellant. Second, has not taken into account expenses of the election agent at 12 meetings other than the meetings addressed by the appellant and has also not taken into account the telephone expense of the election agent. The telephone expenses amounted to Rs. 836.85 between January 11, 1971 and February 10, 1971 and a further sum of Rs. 2, 514 for the period February 11, 1971 to March 15, 1971. Third, it is said that there were 5000 polling booths and if 20 workers were required per booth then 10, 000 workers would be required and the only inference is that an amount in e ", "115. In issue No. 9 there was no amount alleged with regard to telephones bills or election meetings under the heading of alleged election expenses. There was no allegation to that effect in the petition. With regard to expenses for the alleged 12 meetings addressed by the election agent the evidence of is that he addressed about a dozen meetings and he did not include in the election return the expenses incurred for installation of loudspeakers because the expenditure was incurred by him. He also said that he did not include in the election return the expenses incurred over the construction of platforms because the meetings were arranged by . No allegations were made in the petition with regard to any alleged sum of money on account of election meetings where the election agent spoke. rightly said that the telephone expenses and expenses for meetings could not be taken into consideration because no suggestion of the case was made until the stage of ", "116. The respondent's submission is that the appellant was the Prime Minister at the time of the election, and, therefore, there was a big campaign and the expenses were enormous. That will mean little. Expenses incurred or authorised by a political party are under the Amendment Act , 1974 not to be deemed to be expenditure in connection with the election incurred or authorised by the candidate or by his election agent for the purposes of Section 77 of the 1951 Act. The part played by a political party in connection with candidates of the party at the election particularly in relation to expenditure incurred by the political party with regard to candidates of the party has been the subject of some decisions of this Court. This Court has observed that expenditure must be by the candidate himself and any expenditure in his interest by others (not his agent within the meaning of the term of the Election Laws) is not be taken note of. Where vehicles were engaged by and used by the candidate ", "117. Expenses incurred by a political party in support of its candidates have been held by this Court not to fall within the mischief of Section 123 (6) of the 1951 Act (see Shah Jayantilal Ambalal v. ). this Court pointed out that expenses must be incurred or authorised by the candidate or his agent. In that case the manager, the assistant manager, 20 ziladars and their peons were alleged to have worked for the election of the appellant. This Court held that the employment of extra persons and the incurring or authorising of extra expenditure was not by the candidate or his election agent. The extra men employed and paid were in the employment of the father of the appellant. This Court said that the position in law could not be at all different if the father had given those employees a holiday on full pay and they voluntarily worked in connection with the election of the appellant. Persons who volunteer to work cannot be said to be employed or pa ", "118. the appellant challenged the election of the respondent on the ground that the Maharaja and the Rajmata of Gwalior had helped the respondent's election in a number of ways and acted as his agents and the respondent incurred considerable expenditure which exceeded the limit. This Court found that assuming the expenditure was incurred by the Maharaja and the Rajmata of Gwalior for the purpose of canvassing votes, in the absence of any evidence to show that the Maharaja and the Rajmata acted as election agents or that the expenditure was authorised by the respondent, it was not liable to be included in the election expenses. ", "119. On the behalf of the respondent it was said relying on the decision of this Court in case (supra) that if the candidate takes advantage of expenditure incurred by the political party in connection with the election of the candidate or participates in the programme of activity or fails to disavow the expenditure the candidate cannot escape the rigour of the ceiling by saying that he has not incurred the expenditure but his political party has done so. Expenditure incurred by a political party in connection with the election of the candidates of the party is not a part of the election expenses of the candidate. Similarly, participation in the programme of activity organised by a political party will not fall within the election expenses of the candidate of the party. A candidate is not required to disavow or denounce the expenditure incurred or authorised by the political party because the expenditure is neither incurred nor authorised by the candidate. One can disavow what would be asc ", "120. The decision in case (supra) was based on observation extracted from the decision of this Court in . In case (supra) the allegations were that the respondent had been put up by one of the wealthiest business houses in the country which owned or controlled a large number of companies and during the election campaign vast material and human resources of these companies were drawn upon by the respondent. This Court dismissed the appeal on the ground that the appellant had failed to establish that expenditure in excess of the prescribed limit was incurred by the respondent. In case there is an observation that expenses incurred by a political party to advance to the prospects of the candidates put up by it without more do not fall within Section 77 of the 1951 Act. The words \"something more\" were constructed by Counsel for the respondent to mean that if a candidate takes advantage of the expenditure incurred or authorised b ", "121. Allegations that election expenses are incurred or authorised by a candidate or his agent will have to be proved. Authorisation means acceptance of the responsibility. Authorisation must precede the expenditure. Authorisation means reimbursement by the candidate or election agent of the person who has been authorised by the candidate or by the election agent of the candidate to spend or incur. In order to constitute authorisation the effect must be that the authority must carry with it the right of reimbursement. ", "122. For the foregoing reasons the contentions of the respondent that the the appellant exceeded the limit of election expenses fail. ", "123. The respondent contended that the amendments by the Amendment Act s of 1974 and 1975 are constitutionally invalid. It may be stated here that the Constitution (Thirty-ninth Amendment) Act in Section 5 thereof enacts that in the Ninth Schedule to the Constitution after Entry 86, inter alia, the following entries shall be inserted, namely : ", "87. The Representation of the People Act , 1951 (Central Act 43 of 1951). The Representation of the People (Amendment) Act , 1974 (Central Act 58 of 1974); and the Election Laws (Amendment) Act , 1975 (Central Act 40 of 1975). ", "124. The contention of the respondent is that when the power of amending the Constitution cannot be exercised to damage or destroy the basic features of the Constitution or the essential elements of the basic structure or framework thereof, the limitation on the exercise of legislative power will arise not only from the express limitations contained in the Constitution, but also from necessary implication either under articles or even in the preamble of the Constitution. This contention on behalf of the respondent is expanded to mean that if the democratic way of life through parliamentary institutions based on free and fair elections is a basic feature which cannot be destroyed or damaged by amendment of the Constitution, it cannot similarly be destroyed or damaged by any legislative measure. ", "125. These reasons were submitted by the respondent. First, the power to resolve doubts and disputes about the validity of elections of and State Legislatures has been vested by the Constitution in the judicial organ competent to decide election petitions and, therefore, it is not open to the legislature to take away and interfere with these exclusive functions of the by any legislation amending the law governing the election adjudicated by the . Second, the insertion of these Acts in the Ninth Schedule will not confer any immunity on the legislative measure if basic features of the Constitution are damaged or destroyed on the ground that the provisions contravene Part III of the Constitution. Third, any provision in the legislative measures which has the effect of bringing about unfairness between different rival candidates in the matter of election is discriminatory and it not only contravene Article 14 but also violates the implied limitation on legislative power relating to ", "126. The definition of \"candidate\" is amended by the Amendment Act , 1975, the contention of the respondent on the amendment of the definition of \"candidate\" are these. The expression \"returned candidate\" is descriptive of the person and the corrupt practices mentioned in Section 123 of the 1951 Act in relation to a candidate will not be confined to corrupt practices committed with reference to the definition of \"candidate\". Corrupt practices alleged in relation to candidates will be relatable to any period and will not to be confined to corrupt practices alleged between the date of nomination and the date of election. If corrupt practices are committed by candidates who eventually become returned candidates such corrupt practices will be offenses within the meaning of Section 123 of the 1951 Act without any reference to the time of commission. ", "127. Counsel on behalf of the respondent also contended as follows. The basis of fair and free elections is that the election of a candidate will be avoided if any corrupt practice has been committed by the candidate by or with the knowledge and consent of that candidate. The acts of a candidate may be either anterior to the date of nomination or it may be subsequent to the date of nomination. Therefore, the Amendment Act , 1975 destroys and damages free and fair election by allowing candidates to commit corrupt practices prior to the date of nomination. ", "128. The Amendment Act , 1975 is also challenged as falling within the vice of delegated legislation by the amendments inserted as Explanation 3 of Section 77 of the 1951 Act and the insertion of the proviso to Section 123(7) of the 1951 Act. These provisions have already been noticed. Broadly stated expenditure incurred by persons in government service will not be deemed to be for furtherance of the candidate's election. The contentions are these. No guidelines have been laid down as to what expenditure can be incurred or what facilities can be made, what acts or things can be done. Delegation cannot include the change of policy. Policy must be clearly laid down in the Act for carrying into effect the objectives of the legislation. The must declare the policy. Any duty can be assigned, any facility in connection with the election can be asked for by the party in power to be done for the candidate. The official duty opens a wide power of instructions to government servants who may be asked to assi ", "129. The device of conclusive proof which is introduced to add Explanation 3 of Section 123(7) of the 1951 Act with regard to the date with effect from which the person ceased to be in service is said to be an encroachment on judicial power. ", "130. Section 8(a) of the Amendment Act, 1975 which adds a proviso to Section 123 of the 1951 Act to the effect that no symbol allotted under this Act to a candidate shall be deemed to be a religious symbol or a national symbol for the purposes of this clause is attacked as legalising religious symbols and thus offending secularism. ", "131. Section 10 of the Amendment Act, 1975 which enacts that the amendments shall have retrospective effect is challenged as retrospectively legalising a void election. These submissions are made. If this power is upheld there can be a legislative measure to avoid valid elections. The distinction between law-abiding persons and lawless persons is eliminated. One person has not been given the opportunity of spending money at the time of election but the other is retrospectively given the advantages of spending in excess and thereafter of avoiding the effect of excess expenses by validation. ", "132. The contentions on behalf of the respondent that ordinary legislative measures are subject like Constitution Amendments to the restrictions of not damaging or destroying basic structure, or basic features are utterly unsound. It has to be appreciated at the threshold that the contention that legislative measures are subject to restrictions of the theory of basic structures or basic features is to equate legislative measures with Constitution Amendment. The hierarchical structure of the legal order of a State is that the Constitution is the highest level within national law. The Constitution in the formal sense is a solemn document containing a set of legal norms which may be changed only when special prescriptions are observed. The purpose of special prescriptions is to render the changes of these norms more difficult by regulating the manner and form of these amendments. The Constitution consists of those rules which regulate the creation of the general legal norms, in particular, the creation of statu ", "133. Articles 245 and 246 give plenary powers to to legislate. The only question is whether any provision of the Constitution is violated. The power of plenary body is not to be construed like the power of a delegate. The largest kind of power will be attributed to . The only prohibition is with reference to the provisions of the Constitution. The Constitution is the conclusive instrument by which powers are affirmatively created or negatively restricted. The only relevant test for the validity of a statue made under Article 245 is whether the legislation is within the scope of the affirmative grant of power or is forbidden by some provision of the Constitution. ", "134. To accept the basic features or basic structures theory with regard to ordinary legislation would mean that there would be two kinds of limitations for legislative measures. One will pertain to legislative power under Article 245 and 246 and the legislative entries and the provision in Article 13. The other would be that no legislation can be made as to damage or destroy basic features or basic structures. This will mean rewriting the Constitution and robbing the of acting within the framework of the Constitution. No legislation can be free from challenge on this ground even though the legislative measure is within the plenary powers of the . ", "135. The theory of implied limitations on the power of amendment of the Constitution has been rejected by seven Judges in case (supra). Our Constitution has not adopted the due process clause of the American Constitution. Reasonableness of legislative measures is unknown to our Constitution. The crucial point is that unlike the American Constitution where rights are couched in wide general terms leaving it to the courts to evolve necessary limitations our Constitution has denied due process as a test of invalidity of law. , due process was rejected by clearly limiting the rights acquired and by eliminating the indefinite due process. Our Constitution contemplates that considerations of justice or general welfare might require restriction on enjoyment of fundamental rights. ", "136. The theory of basic structures or basic features is an exercise in imponderables. Basic structures or basic features are indefinable. The legislative entries are the fields of legislation. The pith and substance doctrine has been applied in order to find out legislative competency, and eliminate encroachment on legislative entries. If the theory of basic structures or basic features will be applied to legislative measures it will denude and of the power of legislation and deprive them of laying down legislative policies. This will be encroachment on the separation of powers. ", "137. The constitutional validity of a statue depends entirely on the existence of the legislative power and the express provision in Article 13. Apart from the limitation the is not subject to any other prohibition. The amendments made to the 1951 Act by the Amendment Act s, 1974 and 1975 are to give effect to certain views expressed by this in preference to certain views departed from or otherwise to clarify the original intention. It is within the powers of to frame laws with regard to elections. has power to enumerate and define election expenses. has power to lay down limits on election expenses. has power to state whether certain expenses can be included or may be excluded from election expenses. has power to adopt conclusive proof with regard to matters of appointment, resignation or termination of service. has power to state what can be considered to be office of profit. has power to state as to what will and ", "138. The conclusive evidence or conclusive proof clause is an accepted legislative measure. Similarly, giving retrospective effect to legislative amendment is accepted to be valid exercise of legislative power. The well- known pattern of all validation Acts by which the basis of judgments or orders of competent courts and tribunals is changed and the judgments and orders are made ineffective is to be found in & Co. v. State of A. P. The power of the to pass a law includes a power to pass it retrospectively. An important illustration with reference to retrospective legislation in regard to election is the decision of this Court in case (supra). was disqualified by reason of holding an office of profit. First, the ordinance and later the Act was passed to nullify the decision of . The ordinance as well as the Act stated that notwithstanding any judgment or order of any court or tribunal, the officer shall not be disqualified or shall ", "139. A contention was advanced that the legislative measure could not remove the disqualification retrospectively because the Constitution contemplates disqualification existing at certain time in accordance with law existing at that time. One of the views expressed in that case is that Article 191 recognises the power of to declare by law that the holder of the office shall not be disqualified for being chosen as a member. Power is reserved to to make the declaration. There is nothing in the Article to indicate that this declaration cannot be made with retrospective effect. The Act was held not to be ineffective in its retrospective operation on the ground that it is well recognised that and can make their laws operate retrospectively. Any law that can be made prospectively can be made with retrospective operation. It is said that certain kinds of laws cannot operate retrospectively. That is ex post facto legislation. The ", "140. This Court in rejected the contention advanced there that Sections 123 (5) and 124 (5) of the 1951 Act interfered with a citizen's fundamental right to freedom of speech. This Court said that these laws do not stop a man from speaking. They merely prescribe conditions which must be observed if one wants to enter . The right to stand as a candidate and to contest an election is not a common law right. It is a special right created by a statue which can only be exercised on the conditions laid down by the statue. The Fundamental Rights chapter has no bearing on a right like this created by a statue relating to election. ", "141. The contention on behalf of the respondent that the amendment of the definition of \"candidate\" has damaged or destroyed basic structure is untenable. There is no basic structure or basic feature or basic framework with regard to the time when under the election laws a person is a candidate at the election. The contention of the respondent that the expression \"returned candidate\" is descriptive of the expression \"candidate\" will rob Section 100 of its content. The word \"candidate\" in relation to various electoral offences shows that he must be a candidate at the time of the offence. Time is necessary for fixing the offences. A significant distinction arises between the electoral offences under the 1951 Act and the offences under Sections 171-A to 171-I of the Indian Penal Code, namely, that the 1951 Act uses the word \"candidate\" or his election agent with reference to various offences whereas the Indian Penal Code does not use the word \"candidate\" in relation to commission of any offence. Any person may ", "142. The English Representation of the People Act, 1949 called the English Act was relied on by the respondent to show that the word \"candidate\" in the 1951 Act should have the same meaning as in the English Act and there should be no limitation as to time in relation to a candidate.\"Candidate\" is defined in Section 103 of the English Act in relation to parliamentary election to mean a person who is elected to serve in or a person who is nominated as a candidate at the election or is declared by himself or by others to be a candidate on or after the day of the issue of the writ for the election, or after the dissolution or vacancy in consequence of which the writ was issued. The electoral offences under the English Act speak of a person to be guilty of corrupt practices of bribery as mentioned in Section 99 , of treating as mentioned in Section 100 and of undue influence as mentioned in Section 101 of the English Act. These sections in the English Act speak of a person and do not use the expression ", "143. Where a candidate is elected the English definition gives no commencing date as from which his candidature has commenced; whereas, if he be not elected, he is not a candidate until he has been nominated, or is declared to be a candidate on or after the dissolution or vacancy. A candidate who is elected is accordingly a \"candidate\" as soon as he has entered upon his election campaign, and has made it known that he intends to present himself as a candidate at the ensuing election, he may thus become a candidate before the dissolution of , and may be unseated for bribery or treating committed months or even years before the vacancy or election, for such acts are offences at common law. With respect to illegal practices, which are purely statutory offences, it would seem that a narrower construction will prevail, and that a candidate will not be held responsible for payments etc., made before he is a candidate in point of fact, and which payments only become illegal practices by reason of his subs ", "144. It has been held in England that a candidate may be unseated for bribery of treating committed months or even years before the vacancy or election (; ). The present position under the English Act is stated in 's Conduct of Parliamentary Elections 1970 Ed. at p. 330 to be that since the corrupt practice under consideration is purely a statutory offence, which only becomes a corrupt practice by reason of the person in whose support the prohibited expenses were incurred subsequently becoming a candidate, the candidate may not be held responsible. In Norwich the question was considered in relation to the responsibility of a candidate for payments which only became illegal practices by reason of his subsequently becoming a \"candidate\" as defined by statute, and it was held that he was not liable. The liability of a candidate under the English Act , particularly, with regard to election expenses as laid down in Section 63 of the English Act is regarded as open to doubt until the point is set ", "145. Sections 171-A to 171-I of the Indian Penal Code and the provisions contained in Sections 125 to 136 of the 1951 Act follow the pattern of English Act s, namely, Statutes 17 & 18 Victoria, Chapter CII (1853-54); Statutes 21 & 22 Victoria, Chapter LXXXVII (1858) and Statutes 46 & 47 Victoria, Chapter LI (1882). These English Statutes make certain acts punishable as corrupt practice when they relate to persons other than candidates or voters. Section II of 17 & 18 Victoria Chapter CII enacts that the persons mentioned therein shall be deemed guilty of bribery and punishable in accordance with the provisions of the Act. The words used there are \"every person\" who shall do the acts mentioned therein shall be punishable. In these sections dealing with the acts of persons other than candidates and voters no time is mentioned. On the other hand, Section IV of Statutes 17 & 18 Victoria Chapter CII makes certain acts of voters and candidates corrupt practice. Section IV of the aforesaid English Statute enacts tha ", "146. The 1951 Act uses the expression \"candidate\" in relation to several offences for the purpose of affixing liability with reference to a person being a candidate. If no time be fixed with regard to a person being a candidate it can be said that from the moment a person is elected he can be said to hold himself out as a candidate for the next election. The definition in the English Act cannot be of any aid to the construction of the 1951 Act. ", "147. The contention of the respondent is that if a candidate is free to spend as much as a candidate likes before the date of nomination a great premium would be placed on free use of money before the date of nomination. The 1951 Act specifies what election expenses are of a candidate. The statute specifies time in regard to a candidate. That time cannot be enlarged or reduced. The holding out by a person of (sic of) candidature was a flexible and elastic idea. The date of nomination is definite and doubtless. Different views may be taken as to the time of holding out. The has now set the matter at rest. ", "148. The word \"incur\" according to the dictionary meaning means to become liable to. The word \"incur\" means to undertake the liability even if the actual payments may not be made immediately. The undertaking of the responsibility for the expenditure concerned may be either by the candidate or his election agent. Again, a candidate is also to be deemed responsible for the expenditure if he has authorised a particular expenditure to be made by someone else on his behalf. ", "149. The contention on behalf of the respondent is that the Amendment Act s of 1974 and 1975 fall within the vice of delegated legislation because there are no guiding principles with regard to official duty or nature of expenditure in Explanation 3 to Section 77 of the 1951 Act and in the proviso to Section 123 (7) of the 1951 Act. Official duty will be a duty in law. Official duty will be duty under administrative directions of the . Official duty will be for security, law and order, and matters in aid of public purpose. These duties will be in connection with election. To illustrate, Section 197 of the Criminal Procedure Code speaks of official duty. ", "150. This Court in interpreted the words \"official duty\" to have reasonable connection between the act and the discharge of duty. The act must bear such relation to the duty that the person could lay a reasonable claim, but not a pretended fanciful claim, that he did it in the course of the performance of his duty. Where a power is conferred or a duty imposed by statute or otherwise, and there is nothing said expressly inhibiting the exercise of the power or the performance of the duty by any limitations or restrictions, it is reasonable to hold that it carries with it the power of doing all such acts or employing such means as are reasonably necessary for such execution, because it is a rule that when the law commands a thing to be done, it authorises the performance of whatever may be necessary for executing its command. ", "151. There is no vice of delegation in the statutes. ", "\"Delegation is not the complete handing over or transference of a power from one person or body of persons to another. Delegation may be defined as the entrusting, by a person or body of persons, of the exercise of a power residing in that person or body of persons to another person or body of persons, with complete power of revocation or amendment remaining in the grantor or delegator. It is important to grasp the implications of this, for, much confusion of thought has unfortunately resulted from assuming that delegation involves or may involve, the complete abdication or abrogation of a power. This is precluded by the definition. Delegation often involves the granting of discretionary authority to another, but such authority is purely derivative. The ultimate power always remains in the delegator and is never renounced.\" ", "( .) ", "152. The Constitution Twenty-ninth Amendment Act was considered by this Court in case (supra). The Twenty-ninth Amendment Act inserted in the Ninth Schedule to the Constitution Entries 65 and 66 being the Kerala Land Reforms Act, 1969 and the Kerala Land Reforms Act, 1971. This Court unanimously upheld the validity of the Twenty-ninth Amendment Act. The unanimous view of this Court in case is that Article 31-B is not open to challenge. Six Judges held that the Twenty- ninth Amendment Act would be ineffective to protect the impugned Act if they took away the fundamental rights. Six Judges took the view that the Twenty-ninth Amendment Act is valid and further that Article 31-B has been held by this Court to be independent of Article 31-A and that Article 31-B protects scheduled Acts and Regulations and none of the scheduled Acts and Regulations is deemed to be void or ever to have become void on the ground of contravention of any fundamental rights. Article 31-B gives ", "153. The contentions of the respondent that the Amendment Act s of 1974 and 1975 are subject to basic features or basic structure or basic framework fails on two grounds. First, legislative measures are not subject to the theory of basic features or basic structure or basic framework. Second, the majority view in case (supra) is that the Twenty-ninth Amendment which put the two statutes in the Ninth Schedule and Article 31-B is not open to challenge on the ground of either damage to or destruction of basic features, basic structure or basic framework or on the ground of violation of fundamental rights. ", "154. The symbol allotted to the party of the appellant was characterised by the respondent as a religious symbol. Under Article 324 the superintendence, direction and control of elections to , is vested in . Rule 5 of the Conduct of Elections Rules, 1961 states that shall, by notification in and in of each State, specify the symbols that may be chosen by candidates at elections in parliamentary or assembly constituencies and the restrictions to which their choice shall be subject. Rule 10(4) of the 1961 Rules aforesaid states that at an election in a parliamentary or assembly constituency, where a poll becomes necessary, the returning officer shall consider the choice of symbols, expressed by the contesting candidates in their nomination papers and shall, subject to any general or special direction issued in this behalf by allot a different symbol to each contesting candidate in conformi ", "155. Clause 17 of the Election Symbols (Reservation and Allotment) Order, 1968 provides that the commission shall by notification in publish lists specifying national parties and the symbols respectively reserved for them etc. There can, therefore, be no doubt that the power of evolving permissible symbols is exclusively vested in . It is under their directions that the Returning Officer has to make allotments and allotments are made in terms of Clause 5, 6 and 8. Therefore, in the matter of evolving of the permissible symbols, the jurisdictions is vested in . If a candidate displays in addition to the allotted symbol which may have a special appeal on grounds of religion to a particular community, then the will be entitled to go into this question. ", "156. With regard to the symbol of cow and calf being a religious symbol it was said on behalf of the respondent that asked for cow, calf and milkmaid symbol and were refused. They were given the symbol of a \"Rising Sun\". It is impossible to hold that because one party has not been given the symbol of cow, calf and milkmaid, therefore, the symbol of cow and calf becomes a religious symbol. on the evidence adduced by the respondent rightly came to the conclusion that there was no evidence to prove that the cow and calf is a religious symbol. rightly held that cow and calf is not a religious symbol. ", "157. The finding of that the appellant held herself out to be a candidate from December 29, 1970 is set aside because the law is that the appellant became a candidate only with effect from the date of nomination which was February 1, 1971. The finding of that the resignation of did not become effective until it was notified in the is also set aside because under the law the resignation became effective from January 14, 1971. The finding of that the appellant committed corrupt practice in breach of Section 123 (7) of the 1951 Act is also repelled by the legislative changes and is, therefore, set aside. The order of the disqualification of the appellant is also set aside. ", "158. For the foregoing reasons the contentions of the appellant succeed and the contentions of the respondent fail. The appeal is accepted. The judgment of appealed against is set aside the cross objections of the respondent is dismissed. There will be no order as to costs. ", ", J. (concurring) - Civil Appeal No. 887 of 1975 has been filed by Smt. (hereinafter referred to as the appellant) against the judgment of whereby election petition filed by respondent No. 1 (hereinafter referred to as the respondent) to question the election of the appellant to from Rae Bareli parliamentary constituency was allowed and the election of the appellant was declared void. The appellant was found guilty of having committed corrupt practices under Section 123 (7) of Representation of the People Act , 1951 (hereinafter referred to as the R. P. Act) and as such was stated to be disqualified for a period of six years in accordance with Section 8A of the R. P. Act. Cross Appeal No. 909 of 1975 has been filed by against the judgment of in so far as it decided certain issues against the respondent. ", "160. The President of India called upon different constituencies in the country to elect members to by notification dated January 27, 1971 under Section 14(2) of the R. P. Act. Last date for filling nomination papers was fixed as February 3, 1971 for Rae Bareli constituency by . The appellant filed her nomination paper on February 1, 1971. The appellant was for a number of years before the election Prime Minister of India and is since then continuing to hold that office. , who was previously a gazetted officer in holding the post of Officer on Special Duty in and who subsequently submitted his resignation, was appointed the election agent of the appellant. The signed form about the appointment of an election agent was submitted to the Returning Officer on February 4, 1971, the date of scrutiny. The date on the which submitted his resignation and the same became effective is, how(1) The appellant held herself out as a prospective candidate from the Rae Bareli constituency immediately after the dissolution of on December 27, 1970, and for furtherance of her election prospects, she obtained and procured the assistance of who was at that time holding the post of Officer on Special Duty. The appellant thus committed corrupt practice under Section 123(7) of the R. P. Act. ", "(2) The appellant and her election agent procured the assistance of members of armed forces of the Union for furtherance of her election prospects inasmuch as the members of the armed forces arranged planes and helicopters of at her instance for her flights to enable her to address meetings in her constituency. The appellant thereby committed corrupt practice under Section 123(7) of the R. P. Act. ", "(3) The appellant and her election agent obtained the assistance of a number of gazetted officers and members of the police force for the furtherance of her election prospects inasmuch as the services of the District Magistrate, Superintendent of Police, and the Home Secretary, Uttar Pradesh Government were utilised for the purposes of the construction of rostrums and installation of loudspeakers at various places within the constituency where the appellant addressed her election meetings as also for the purpose of making arrangement of barricading and posting of police personnel on the routes by which the appellant was to travel in her constituency and at the places where she was to address meetings, in order to give publicity to her visits and thus attract large crowds. The appellant was thereby stated to have committed corrupt practice under Section 123(7) of the R. P. Act. ", "(4) , election agent of the appellant and her other agents with the consent of , freely distributed quilts, blankets, dhotis and liquor among the voters to induce them to vote for her and thereby the appellant committed corrupt practice of bribery under Section 123(1) of the R. P. Act.(5) The appellant and her election agent made extensive appeals to the religious symbol of cow and calf and thereby committed corrupt practice under Section 123(3) of the R. P. Act. ", "(6) and some other persons with his consent hired and procured a number of vehicles for the free conveyance of electors to the polling stations and thereby committed corrupt practice under Section 123(5) of the R. P. Act. ", "(7) The appellant and her election agent incurred or authorised expenditure in contravention of Section 77 of the R. P. Act and thereby committed corrupt practice under Section 123(6) of the R. P. Act. ", "161. The appellant in her written statement denied the various allegations levelled against her and pleaded that resigned from his post on January 13, 1971 and his resignation was accepted with effect from January 14, 1971. Notification dated January 25, 1971 was issued by the Prime Minister's Secretariat in that connection. It was added that , then Secretary to the Prime Minister, told on the same day on which the resignation was tendered that it was accepted and that formal orders would follow. became the election agent of the appellant on February 4, 1971. During the period he was a gazetted officer in , he did not do any work in furtherance of the appellant's election prospects. Regarding the use of planes and helicopters of , the appellant admitted that on February 1, 1971 she went by an plane from Delhi to Lucknow from where she went by car to Rae Bareli, addressing meetings en route. It was furth ", "162. Following issues were framed in the case : ", "\"(1) Whether respondent No. 1 obtained and procured the assistance of in furtherance of the prospects of her election while he was still a gazetted officer in the service of ? If so, from what date?(2) Whether at the instance of respondent No. 1 members of the armed forces of the Union arranged planes and helicopters for her, flown by members of the armed forces, to enable her to address election meetings on February 1, 1971 and February 25, 1971, and if so, whether this constituted a corrupt practice under Section 123(7) of the Representation of the People Act ? ", "(3) Whether at the instance of respondent No. 1 and her election agent , the District Magistrate of Rae Bareli, the Superintendent of Police of Rae Bareli and the Home Secretary of arranged for rostrums, loudspeakers and barricades to be set up and for members of the police force to be posted in connection with her election tour on February 1, 1971 and February 25, 1971; and if so, whether this amounts to a corrupt practice under Section 123(7) of the Representation of the People Act ? ", "(4) Whether quilts, blankets, dhotis and liquor were distributed by agents and workers of respondent No. 1, with the consent of her election agent , at the places and on the dates mentioned in Schedule A the petition in order to induce electors to vote for her? ", "(5) Whether the particulars given in paragraph 10 and Schedule A of the petition are too vague and general to afford a basis for allegation for bribery under Section 123(1) of the Representation of the People Act ? ", "(6) Whether by using the symbol of the cow and calf, which had been allotted to her party by in her campaign the respondent No. 1 was guilty of making an appeal to a religious symbol and committed a corrupt practice as defined in Section 123(3) of the Representation of the People Act ? ", "(7) Whether on the dates fixed for the poll voters were conveyed to the polling stations free of charge on vehicles hired and procured for the purpose by respondent No. 1's election agent , or other persons with the consent, as detailed in Schedule B to the petition?(8) Whether the particulars given in paragraph 12 and Schedule B of the petition are too vague and general to form a basis for allegations regarding a corrupt practice under Section 123(5) of the Representation of the People Act ? ", "(9) Whether respondent No. 1 and her election agents incurred or authorised expenditure in excess of the amount prescribed by Section 77 of the Representation of the People Act, read with Rule 90 as detailed in para 13 of the petition? ", "(10) Whether the petitioner had made a security deposit in accordance with the rules of as required by Section 117 of the Representation of the People Act ? ", "(11) To what relief, if any, is the petitioner entitled?\" ", "Subsequent to the framing of the above issues, the following three additional issues were framed in pursuance of the judgment of this Court in an appeal against an interlocutory order of : ", "\"(1) Whether respondent No. 1 obtained and procured the assistance of in furtherance of the prospects of her election while he was still a gazetted officer in the service of ? If, so from what date ? ", "(2) Whether respondent No. 1 held herself out as a candidate from any date prior to February 1, 1971 and, if so, from what date? ", "(3) Whether continued to be in the service of Government of India from and after February 14, 1971 or till which date?\" ", "163. During the pendency of the election petition in , Section 77 of the R. P. Act was amended by an Ordinance which was subsequently replaced by Act 58 of 1974 (hereinafter referred to as the 1974 amending Act or Act 58 of 1974). The said amending Act inserted two explanation at the end of sub-section (1) of Section 77 of the R. P. Act. The material part of the explanations reads as under : ", "\"Explanation 1. - Notwithstanding any judgment, order or decision of any court to the contrary, any expenditure incurred or authorised in connection with the election of a candidate by a political party or by any other association or body of persons or by any individual (other than the candidate or his election agent) shall not be deemed to be, and shall not ever be deemed to have been, expenditure in connection with the election incurred or authorised by the candidate or by his election agent for the purposes of this sub-section : ", "Provided * * * * Explanation 2. - For the purposes of Explanation 1, \"political party\" shall have the same meaning as in the Election Symbols (Reservation and Allotment) Order, 1968, as for the time being in force.\" ", "The above amendment in Section 77 had a bearing on the allegation which was the subject-matter of issue No. 9. The respondent filed writ petition challenging the validity of the amending Act. ", "164. decided issues Nos. 2, 4, 6 and 7 in favour of the appellant and against the respondent. Issues Nos. 5, 8 and 10 were found in favour of respondent and against the appellant. On issue No. 9 the finding of was that the total amount of expenditure incurred or authorised by the appellant or her election together with the expenditure proved to have been incurred by the party or by in connection with the appellant's election amounted to Rs. 31, 976.47 which was sufficiently below the prescribed limit of Rs. 35, 000. The appellant as such was held not guilty of any corrupt practice under Section 123(6) of the R. P. Act. As the respondent was found to have failed to prove that the expenses of the appellant or her election agent, together with the expenses found to have been incurred by the political party and in connection with the appellant's election exceeded the prescribed limit, held that no ground had been made out for in ", "165. On additional issue No. 2, the finding of was that the appellant held herself out as a candidate from the Rae Bareli parliamentary constituency on December 29, 1970. Issue No. 3 was decided by against the appellant. It was held that the appellant obtained the assistance of the officers of , particularly the District Magistrate, Superintendent of Police, the Executive Engineer, and the Engineer, for construction of rostrums and arrangement of supply of power for loudspeakers in the meeting addressed by her on February 1, 1971 and February 25, 1971 in furtherance of her election prospects. The appellant, as such was found guilty of corrupt practice under Section 123(7) of the R. P. Act. On additional issue No. 3, found that continued to be in the service of till January 25, 1971, which was the date of the notification regarding the acceptance of 's resignation. The ", "166. As a result of its findings on issue No. 3, issue No. 1 read with additional issue No. 1, additional issue No. 2 and additional issue No. 3, allowed the petition and declared the election of the appellant to to be void. The appellant was found guilty of having committed corrupt practice under Section 123(7) of the R. P. Act by having obtained the assistance of gazetted officers of , viz., the District Magistrate and the superintendent of Police, , the Executive Engineer, PWD, and Engineer, , in furtherance of her election prospects. The appellant was further found guilty of having committed another corrupt practice under Section 123(7) of the R. P. Act by having obtained the assistance of , a gazetted officer in holding the post of officer on the Special Duty in Prime Minister's Secretariats, for the furtherance of her election prospects. The appellant, it was accordingly ", "167. An appeal against the judgment of the learned Single Judge of dismissing the writ petition is pending before . ", "168. During the pendency of these appeals, passed the Election Laws (Amendments) Act, 1975 (Act 40 of 1975) (hereinafter referred to as 1975 amending Act or Act 40 of 1975) and the same was published in the Gazette of India Extraordinary dated August 6, 1975. Section 2 of the 1975 Amending Act substituted a new section for Section 8A in the Act. According to the new section, the case of every person found guilty of a corrupt practice by an order under Section 99 shall be submitted as soon as may be, after such order takes effect to the President for determination of the question as to whether such person shall be disqualified and if so, for what period, not exceeding six years. It is also provided that the person who stands disqualified may before the expiry of the period of disqualification submit a petition to the President for the removal of such disqualification for the unexpired portion of the said period. The President shall then give his decision on such petition after obtaining the opinion \"6. In Section 77 of the Principal Act, in sub-section (1), - ", "(a) for the words 'the date of publication of the notification calling the election', the words 'the date on which he has been nominated' shall be substituted; ", "(b) after Explanation 2, the following Explanation shall be inserted, namely : ", "'Explanation 3. - For the removal of doubt, it is hereby declared that any expenditure in respect of any arrangements made, facilities provided or any other act or thing done by any person in the service of the Government and belonging to any of the classes mentioned in clause (7) of Section 123 in the discharge or purported discharge of his official duty as mentioned in the provision to that clause shall not be deemed to be expenditure in connection with the election incurred or authorized by a candidate or by his election agent for the purposes of this subsection.' ", "7. In Section 79 of the principal Act, for clause (b), the following clause shall be substituted, namely : ", "' (b) 'candidate' means a person who has been or claims to have been duly nominated as a candidate at any election.' ", "8. In Section 123 of the principal Act, - ", "(a) in clause (3), the following proviso shall be inserted at the end, namely : ", "'Provided that no symbol allotted under this Act to a candidate shall be deemed to be a religious symbol or a national symbol for the purposes of this clause.'; ", "(b) in clause (7), the following proviso shall be inserted at the end, namely : ", "'Provided that where any person, in the service of the Government and belonging to any of the classes aforesaid, in the discharge or purported discharge of his official duty, makes any arrangements or provides any facilities or does any other act or thing, for, to, or in relation to, any candidate or his agent or any other person acting with the consent of the candidate or his election agent, (whether by reason of the office held by the candidate or for any other reason), such arrangements, facilities or act or thing shall not be deemed to be assistance for the furtherance of the prospects of that candidate's election.'; ", "(c) in the Explanation at the end, the following shall be added, namely : ", "' (3) For the purposes of clauses (7), notwithstanding anything contained in any other law, the publication in of the appointment, resignation, termination of service, dismissal or removal from service of a person in the service of (including a person serving in connection with the administration of a Union territory) or a state Government shall be conclusive proof -(i) of such appointment, resignation, termination of service, dismissal or removal from service, as the case may be, and ", "(ii) whether the date of taking effect of such appointment, resignation, termination of service, as the case may be, is stated in such publication, also of the case may be, is stated in such publication, also of the fact that such person was appointed with effect from the said date, or in the case of resignation, termination of service, dismissal or removal from service, such person ceased to be in such service with effect from the said date.' (9). In the Indian Penal Code , in Section 171A , for clause (a), the following clause shall be substituted, namely : ", "' (a) 'candidate' means a person who has been nominated as a candidate at any election.' ", "10. The amendments made by Sections 6 , 7 and 8 of this Act in the principal Act shall also have retrospective operation so as to apply to and in relation to any election held before the commencement of this Act to either of parliament or to either or the of the Legislature of a State - ", "(i) in respect of which any election petition may be presented after the commencement of this Act; or ", "(ii) in respect of which any election petition is pending in any High Court immediately before such commencement; or ", "(iii) in respect of which any election petition has been decided by before such commencement but no appeal has been preferred to against the decision of before such commencement and the period of limitation for filing such appeal has not expired before such commencement; or ", "(iv) in respect of which appeal from any order of made in any election petition under Section 98 or section 99 of the principal Act is pending before immediately before such commencement.\" ", "169. It is submitted by Mr. on behalf of the respondent that the amendments made in the R. P. Act have an impact upon five out of the seven grounds which were set up by the respondent to assail the election of the appellant. ", "170. On August 10, 1975 the Constitution (Thirty-ninth Amendment) Act was published. A number of constitutional changes were made by the Constitution Amendment Act . We are, however, concerned with Section 4 of the Constitutional Amendment Act which inserted Article 329A in the Constitution after Article 329. Article 329A reads as under : ", "\"329A. Special provision as to elections to parliament in the case of Prime Minister and Speaker. - (1) Subject to the provisions of Chapter II of Part V [Except sub-clause (e) of clause (1) of Article 102 ], no election - ", "(a) to either House of Parliament of a person who holds the office of Prime Minister at the time of such election or is appointed as Prime minister after such election; ", "(b) to of a person who holds the office of speaker of that at the time of such election or who is chosen as the Speaker for that after such election; ", "shall be called in question, except before such authority [not being any such authority as is referred to in clause (b) of Article 329] or body and in such manner as may be provided for by or under any law made by parliament and any such law may provide for all other matters relating to doubts and disputes in relation to such election include the grounds on which such election may be questioned. ", "(2) The validity of any such law as is referred to in clause (1) and the decision of any authority or body under such law shall not be called in question in any court. ", "(3) Where any person is appointed as Prime Minister or, as the case may be, chosen to the office of the Speaker of , while an election petition referred to in clause (b) of Article 329 in respect of his election to either House of or, as the case may be, to is pending, such election petition shall abate upon such person being appointed as Prime Minister or, as the case may be, being chosen to the office of the Speaker of , but such election may be called in question under any such law as is referred to in clause (1).(4) No law made by before the commencement of the Constitution (Thirty-ninth Amendment) Act, in so far as it relates to election petitions and matters connected therewith, shall apply or shall be deemed ever to applied to or in relation to the election of any such person as is referred to in clause (1) to either House of and such election shall not be deemed to be void or ever to have become void on any ground on which such election could be declared to be void or has, before such commencement, been declared to be void under any such commencement, been declared to be void under any such law and notwithstanding any order made by any court, before such commencement, declaring such election to be void, such election shall continue to be valid in all respects and any such order and any finding on which such order is based shall be and shall be deemed always to have been void and of no effect. ", "(5) Any appeal or cross appeal against any such order of any court as is referred to in clause (4) pending immediately before the commencement of the Constitution (Thirty-ninth Amendment) Act, before shall be disposed of in conformity with the provisions of clause (4). ", "(6) The provisions of this article shall have effect notwithstanding anything contained in this Constitution.\" ", "171. Section 5 of the above Constitution Amendment Act inserted in the Ninth Schedule to the Constitution a number of enactments including the R. P. Act as also Acts 58 of 1974 and 40 of 1975. ", "172. At the hearing of the appeal Mr. on behalf of the appellant has relied upon clause (4) of the new Article 329A and has contended that that clause clearly applies to the present case. It is urged that in view of that clause no law made by before the coming into force of the Constitution (Thirty-ninth Amendment) Act, i.e., before August 10, 1975, in so far as it relates to the election petitions and matters connected therewith shall apply or shall be deemed ever to have applied to or in relation to the election to of the appellant who being Prime Minister is one of the persons referred to in clause (1) of that article. It is further submitted that in view of that clause, the election of the appellant shall not be deemed to be void or ever to have become void on any ground on which such election could be declared to be void or has before such commencement been declared to be void under any such law. Mr. also adds that notwithstanding the order made by b ", "173. In reply Mr. on behalf of the respondent has not controverted, and in our opinion rightly, the stand taken by Mr. that clause (4) of the article applies to the facts of the present case. He, however, contends that Section 4 of the Constitution Amendment Act which has inserted Article 329A in the Constitution is invalid. The validity of the above constitutional amendment has been challenged by Mr. on the following two grounds : ", "(1) The above constitutional amendment affects the basic structure or framework of the Constitution and is, therefore, beyond the amending power under Article 368. ", "(2) The Constitution Amendment Act was passed in a session of after some members of had been unconstitutionally detained and thus illegally prevented from influencing the views of other members present at the time the above Act was passed. This ground, it is urged, also affects the validity of the amending Act 40 of 1975. ", "174. Article 329A deals with election to either of of a person who holds the office of Prime Minister at the time of such election or is appointed as Prime Minister after such election and to of a person who holds the office of Speaker of that at the time of such election or who is chosen as the Speaker for that after such election. According to clause (1) of Article 329A , no election of persons mentioned above shall be called in question, except before such authority or body and in such manner as may be provided for by or under any law made by . It is made clear that the authority before which such election shall be called in question would not be the one as is referred to in clause (b) of Article 329. The law to be made by under clause (1) may provide for all other matters relating to doubts and disputes in relation to such election including the grounds on which such election may be questioned. The above law shall be subject to the ", "175. The proposition that the power of amendment under Article 368 does not enable to alter the basic structure of framework of the Constitution was laid down by this Court by a majority of 7 to 6 in the case of . Apart from other reasons which were given in some of the judgments of the learned Judges who constituted the majority, the majority dealt with the connotation of the word \"amendment\". It was held that the words \"amendment of the Constitution\" in Article 368 could not have the effect of destroying or abrogating the basic structure of the Constitution. Some of us who were parties to that case took a different view and came to the conclusion that the words \"amendment of the Constitution\" in Article 368 did not admit of any limitation. Those of us who were in the minority in 's case (supra) may still hold the same view as was given expression to in that case. For the purpose of the present case, we shall have to proceed in accorda ", "176. Before dealing with the question as to whether the impugned amendment affects in the basic structure of the Constitution, I may make it clear that this is not concerned with the wisdom behind or the propriety of the impugned constitutional amendment. These are matters essentially for those who are vested with the authority to make the constitutional amendment. All that this is concerned with is the constitutional validity of the impugned amendment. ", "177. I may first deal with the second contention advanced by Mr. . According to him, the impugned constitutional amendment and the amending Act of 1975 were passed in session of wherein some members, including the respondent, could not be present because they had been illegally detained. The fact that those measures were passed by the requisite majority has not been questioned by the learned Counsel but he submits that if the above mentioned members had not been detained and not been prevented from attending the sitting of , they could have influenced the other members and as such it is possible that the impugned Constitution Amendment Act and the 1975 R. P. Amending Act might not have been passed. Mr. accordingly asserts that the sittings of the Houses of in which the above mentioned two measures were passed were not legal sittings. Any measures passed in such sittings, according to the learned Counsel, cannot be considered to be a valid piece of ", "178. There is, in my opinion, no force in the above submission. The proposition that a member of cannot claim immunity from being detained under a law relating to preventive detention does not now admit of much doubt. The privileges, powers and the immunities of the members of the two Houses of Indian as well as of are the same as those of the members of as they existed at the time of the commencement of the Constitution. The position about the privileges of the members of as it obtained in the United Kingdom at the relevant time has been stated in ary Practice. 18th Ed. (p. 100) as under : ", "\"The privilege of freedom from arrest is limited to civil causes, and has not been allowed to interfere with the administration of criminal justice or emergency legislation.\" ", "The above observations were relied upon by this Court in the case of . The petitioners in that case were members of . They were detained by orders passed by under Rule 30(1) (b) of the Defence of India Rules, 1962. They challenged the validity of the orders of detention, inter alia, on the ground that Rule 30(1) (b) was invalid because a legislator cannot be detained so as to prevent him from exercising his constitutional rights as legislator while the legislative chamber to which he belongs is in session. This Court rejected that contention and held that the true constitutional position is that so far as a valid order of detention is concerned, a member of can claim no special status higher than that of an ordinary citizen and that he is as much liable to be arrested as detained under it as any other citizen. It was also held that if an order of detention validly prevents a member from attending a session of ", "179. Question as to whether a member of has been validly detained under a law relating to preventive detention can, in my opinion, be appropriately gone into in proceedings for a writ of habeas corpus. Such question cannot be collaterally raised in proceedings like the present wherein the court in concerned with the validity of a Constitution Amendment Act and an Act to amend the Representation of the People Act . In deciding a case before it the court should decide matters which arise directly in the case. A court should resist the attempt of a party to induce it to decide a matter which though canvassed during arguments is only incidental and collateral and can appropriately be dealt with separate proceedings. ", "180. The contention advanced by Mr. that the sittings of the two of the in which the impugned Acts were passed were not valid essentially relates to the validity of the proceedings of the two of . These are matters which are not justiciable and pertain to the internal domain of the two . Of course, the courts can go into the question as to whether the measures passed by are constitutionally valid. The court cannot, however, go into the question as to whether the sittings of the of were not constitutionally valid because some of those were prevented from attending and participating in the discussions in those . It has not been disputed before us, as already mentioned, that the impugned Constitution Amendment Act and the statutory amendment Act were passed by the requisite majority. It is not the case of the respondent that the number of the detained members of was so large, that if they had voted again ", "181. According to clause (3) of Article 105 of the Constitution, to which a short reference has been made earlier, the powers, privileges and immunities of , and of the members and the committees of each , shall be such as may from time to time be defined by by law, and, until so defined, shall be those of the of Commons of the of the United Kingdom, and of its members and committees, at the commencement of this Constitution. No law contemplated by clause (3) has been made by the in India and as such we have to find out the powers, privileges and immunities of the of Commons in United Kingdom at the relevant time. In the case of v. the plaintiff, having been returned as member for the borough of Northampton, required the speaker of the of Commons to call him to the table for the purpose of taking oath. In consequence of something which had transpired on a former occasion the Speaker declined to do so. The \". . . for the purpose of determining on a right to be exercised within the itself, and in particular the right of sitting and voting, the and the alone could interpret the statute but. . . as regard rights to be exercised out of and independently of the , such as the right of suing for a penalty for having sat and voted, the statute must be interpreted by this independently of the .\" ", "The above passage has been cited on page 83 in Parliament Practice, 18th Ed. with a view to show that it is a right of to be the sole judge of the lawfulness of its own proceedings. It would follow from the above that the courts cannot go into the lawfulness of the proceedings of . ", "182. The act of detaining a person is normally that of an outside agency and not that of . It would certainly look anomalous if the act of an outside agency which might ultimately turn out to be not legal could affect the validity of the proceedings of or could prevent that from assembling and functioning. ", "183. The matter can also be looked at from another angle. copies of the Election Laws (Amendments) Act, 1975 (Act 40 of 1975) and the Constitution (Thirty-ninth Amendment) Act have been produced before us. In the face of the publication in the of the above mentioned two Acts this must assume that those two Acts were duly passed. It may be pertinent in this context to refer to the position in the United States where it was laid down in the case of v. as under : ", "\"The signing by the Speaker of , and by the President of the , in open session, of an enrolled bill, is an official attestation by the two houses that such bill has passed by ; and when the bill, thus attested receives the approval of the President, and is deposited in the public archives, its authentication as a bill that has passed is complete and unimpeachable. An enrolled Act thus authenticated is sufficient evidence of itself that it passed .\" ", "In the case of a constitutional amendment which requires ratification by the States, the position was stated by in the case of v. as follows : ", "\"The proclamation by the Secretary certified that, from official documents on file in , it appeared that the proposed Amendment was ratified by -six States, and that it\" ", "has become valid to all intents and purposes as a part of the Constitution of the United States \". As the Legislatures of Tennessee and West Virginia had power to adopt the resolutions of ratification, official notice to the Secretary, duly authenticated, that they had done so, was conclusive upon him, and, being certified to by his proclamation, is conclusive upon the courts.\" ", "184. I am, therefore, of the view that the constitutional validity of the Constitution Amendment Act and the 1975 Act amendment the Representation of the People Act cannot be assailed on the ground that some members of were prevented because of their detention from attending and participating in the proceedings of the respective Houses of . ", "185. We may now deal with clause (4) of Article 329A which has been added by the Constitution (Thirty-ninth Amendment) Act. It is necessary to clarify at the outset that we are concerned in the present case only with the constitutional validity of clause (4) and not with that of the other clauses of that article. I, therefore, express no opinion about the validity of the other clauses of Article 329A. Clause (4) consists of four parts : ", "(i) No law made by before the commencement of the Constitution (Thirty-ninth Amendment) Act in so far as it relates to the election petitions of matters connected therewith shall apply or shall be deemed ever to have applied to or in relation to the election of any such person as is referred to in clause (1) to either House of ;(ii) and such election shall not be deemed to be void or ever to have become void on any ground on which such election could be declared to be void or has before such commencement been declared to be void under any such law; ", "(iii) and notwithstanding any order made by any court before such commencement declaring such election to be void, such election shall continue to be valid in all respects; ", "(iv) and any such order and any finding on which such order is based shall be and shall be deemed always to have been void and of no effect. ", "186. In so far as part (i) is concerned, I find that it relates to a matter which can be the subject of an ordinary legislation or a constitutional amendment. According to this part, no law made by before the commencement of the Constitution (Thirty-ninth Amendment) Act in so far as it relates to the election petitions and matters connected therewith shall apply and shall be deemed ever to have applied to or in relation to the election of any such person as is referred to in clause (1) to either House of . A law in the above terms can validly be made by a as well as by a constituent authority. The fact that the above law would have retrospective effect would not detract from the competence of the or constituent authority to make such a law. It is well- settled that it is permissible for a to make a law with retrospective effect. The power of a to make a law with retrospective effect is not curtailed or circumscribed by the fact that th ", "187. Part (ii) of clause (4) spells out the consequence which flows from part (i) of the clause. If the previous law in so far as it relates to the election petitions and matters connected therewith was not to apply to the election of the Prime Minister and the Speaker, it would necessarily follow that the election of the appellant who was the Prime Minister would not be deemed to be void or ever to have become void on the ground on which such election could be declared to be void or has before such commencement been declared to be void under any such law. ", "188. The same, to some extent, appears to be true of part (iv) of clause (4). If the previous law in so far as it relates to the election petitions and matters connected therewith was not to apply to the election of the appellant, shall be deemed to have had no jurisdiction to decide the election petition challenging the election of the appellant. The effect of part (i) of clause (4) is that was divested of the jurisdiction to decide the dispute relating to the election of the appellant with a retrospective effect. The law under which the election of the appellant was declared to be void as a result of the amendment was also made inapplicable with retrospective effect to the dispute relating to the election of the appellant. The resultant effect of the amendment thus was that the order by which the election of the appellant was declared to be void and the finding on which such order was based were rendered to be void and no effect. ", "189. Another aspect of part (iv) of clause (4) relates to the question as to whether it is open to the constituent authority to declare an order and a finding of to be void and of no effect or whether such a declaration can be made only either in separate judicial proceedings before a higher court. ", "190. A declaration that an order made by a court of law is void is normally part of the judicial function and is not a legislative function. Although there is in the Constitution of India no rigid separation of powers, by and large the spheres of judicial function and legislative function have been demarcated and it is not permissible for the to encroach upon the judicial sphere. It has accordingly been held that a while it is entitled to change with retrospective effect the law which formed the basis of the judicial decision, it is not permissible to the to declare the judgment of the court to be void or not binding (see , v. and State of Tamil Nadu v. ). ", "191. The position as it prevails in the Unites States, where guarantee of due process of law is in operation, is given on pages 318-19 of Vol. 46 of the American Jurisprudence 2d as under : ", "\"The general rule is that the may not destroy, annul, set aside, vacate, reverse, modify, or impair the final judgment of a court of competent jurisdiction, so as to take away private rights which have become vested by the judgment. A statute attempting to do so has been held unconstitutional as an attempt on the part of the to exercise judicial power, and as a violation of the constitutional guarantee of due process of law. The is not only prohibited from reopening cases previously decided by the courts, but is also forbidden to affect the inherent attributes of a judgment. That the statute is under the guise of an act affecting remedies does not alter the rule. It is worthy of notice, however, that there are cases in which judgments requiring acts to be done in the future may validly be affected by subsequent legislation making illegal that which the judgment found to be legal, or making legal that which the judgment found to be illegal. ", "10. Judgment as to public right. ", "With respect to legislative interference with the judgment, a distinction has been made between public and private rights under which distinction a statute may be valid even though it renders ineffective a judgment concerning a public right. Even after a public right has been established by the judgment of the court, it may be annulled by subsequent legislation.\" ", "192. Question arises whether the above limitation imposed upon the about its competence to declare a judgment of the court to be void would also operate upon the constituent authority? ", "193. View has been canvassed before us that the answer to the above question should be in the negative. Although normally a declaration that the judgment of a court is void can be made either in separate proceedings or in proceedings before the higher court, there is, according to this view, no bar to the constituent authority making a declaration in the constitutional law that such an order would be void especially when it relates to a matter of public importance like the dispute relating to the election of a person holding the office of Prime Minister. The declaration of the voidness of the judgment is something which can ultimately be traced to part (i). Whether such a declaration should be made by the court or by the constituent authority is more, it is urged, a matter of the mechanics of making the declaration and would not ultimately affect the substance of the matter that the judgment is declared void. According to Article 31B , without prejudice to the generality of the provisions contained \"There was speculation during the argument as to what the position would be if sought to procure such a result by first amending the Constitution by a two-thirds majority. But such a situation does not arise here. In so far as any Act passed without recourse to Section 29 (4) of the Constitution purports to usurp or infringe the judicial power it is ultra vires.\" ", "The above observations, it is urged, show that the restriction upon the in encroaching upon judicial sphere may not necessarily hold good in the case of constituent authority. ", "194. The above contention has been controverted by Mr. and he submits that the limitations on the power of the that it cannot declare void a judgment of the court equally operates upon the constituent authority. It is urged that the constituent authority can only enact a law in general terms, even though it be a constitutional law. The constituent authority may also, if it so deems proper change the law which is the basis of a decision and make such change with retrospective effect, but it cannot, according to the learned Counsel, declare void the judgment of the court. Declaration of voidness of a judgment, it is stated, is a judicial act and cannot be taken over by the constituent authority. Although s or the constituent authority can make laws, including for creation of courts, they cannot, according to the submission, exercise judicial functions by assuming the powers of a super court in the same way as the courts cannot act as a super . It is, in my opini ", "195. We may now come to part (iii) of clause (4). By part (iii) it is declared that the election of the appellant shall continue to be valid in all respects. Such a declaration would not follow from part (i) of the clause. It would not also follow from part (ii) and part (iv) of the clause which, as mentioned earlier, in effect represented the consequences flowing from part (i). The election to of the appellant, who was the Prime Minister, was challenged on the ground that she or her election agents had been guilty of some malpractices. The declaration that her election was to be valid in all respects necessarily involved the process of going into the grounds on which her election had been assailed and holding those grounds to be either factually incorrect or to be of such a nature as in law did not warrant the declaration of her election to be void. The case of the appellant is that some of the grounds mentioned against her were factually incorrect and in respect of those grounds the findings ", "196. The dispute relating to the election of the appellant is also not to be governed by law is to be enacted under clause (1) of Article 329A. Such a law would apply only to future elections. The result is that so far as the dispute relating to the election of the appellant is concerned, a legal vacuum came into existence. It was open to the constituent authority to fill that vacuum by prescribing a law which was to govern the dispute arising out of the petition filed by the respondent to challenge the election of the appellant. The constituent authority, however, did not do so and straightaway proceeded to declare the election of the appellant to be valid. There is nothing in clause (4) to indicate that the constituent authority applied any law in declaring the election of the appellant to be valid and if so, what was that law. ", "197. I am unable to accede to the argument that the constituent authority kept in view the provisions of the R. P. Act as amended by Acts 58 of 1974 and 40 of 1975 and their impact on the challenge to the election of the appellant in declaring the election of the appellant to be valid. The difficulty in accepting this argument is that in part (i) of clause (4) the constituent authority expressly stated that the previous law, namely the R. P. Act as amended in so far as it related to election petitions and matters connected therewith was not to apply so far as the challenge to the election of the appellant was concerned. It is also difficult to agree that the constituent authority took into account some other unspecified law or norm in declaring the election of the appellant to be valid. As mentioned earlier, there is nothing in clause (4) to indicate that the constituent authority took into account some other law or norm and if so, what that law or norms was. The position which thus emerges is that according ", "198. This in the case of (supra) held by majority that the power of amendment of the Constitution contained in Article 368 does not permit altering the basic structure of the Constitution. All the seven Judges who constituted the majority were also agreed that democratic set-up was part of the basic structure of the Constitution. Democracy postulates that there should be periodical election, so that people may be in a position either to re-elect the old representatives or, if they so choose, to change the representatives and elect in their place other representative. Democracy further contemplates that the elections should be free and fair, so that the voters may be in a position to vote for candidates of their choice. Democracy can indeed function only upon the faith that election are free and fair and not rigged and manipulated, that they are effective instruments of ascertaining popular will both in reality and form and are not mere rituals calculated to generate illusion of defe ion arises whether a member of has become disqualified for membership, the decision of that shall be taken and shall be final. ", "199. Not much argument is needed to show that unless there be a machinery for resolving an election dispute and for going into the allegations that elections were not free and fair being vitiated by malpractices, the provision that a candidate should not resort to malpractices would be in the nature of a mere pious wish without any legal sanction. It is further plain that if the validity of the election of a candidate is challenged on some grounds, the said election can be declared to be valid only if we provide a forum for going into those grounds and prescribe a law for adjudicating upon those grounds. If the said forum finds that the grounds advanced to challenge the election are not well-founded or are not sufficient to invalidate the election in accordance with the prescribed law or dismisses the petition to challenge the election on some other ground, in such an event it can be said that the election of the returned candidate is valid. ", "200. Besides other things, election laws lay down a code of conduct in election matters and prescribe, what may be called, rules of electoral morality. Election laws also contain a provision for resolving disputes and determination of controversies which must inevitably arise in election matters as they arise in other spheres of human activity. The object of such a provision is to enforce rules of electoral morality and to punish deviance from the prescribed code of conduct in election matters. It is manifest that but for such a provision, there would be no sanction for the above code of conduct and rules of electoral morality. It is also plain that nothing would bring the code of conduct into greater contempt and make a greater mockery of it than the absence of a provision to punish its violation. The position would become all the more glaring that even though a provision exists on the statute book for punishing violation of the code of conduct in election matters, a particular election is made immune and g ", "201. The vice of clause (4) of Article 329A is not merely that it makes the previous law contained in the R. P. Act as amended by Act 58 of 1974 and 40 of 1975 inapplicable to the challenge to the election of the appellant, it also makes no other election law applicable for resolving that dispute. The further vice from which the said clause suffers is that it not merely divests the previous authority, namely, of its jurisdiction to decide the dispute relating to the election of the appellant, it confers no jurisdiction on some other authority to decide that dispute. Without even prescribing a law and providing a forum for adjudicating upon the grounds advanced by the respondent to challenge the election of the appellant, the constituent authority has declared the election of the appellant to be valid. ", "202. To confer an absolute validity upon the election of one particular candidate and to prescribe that the validity of that election shall not be questioned before any forum or under any law would necessarily have the effect of saying that howsoever gross may be the improprieties which might have vitiated that election, howsoever flagrant may be the malpractices which might have been committed on behalf of the returned candidate during the course of the election and howsoever foul and violative of the principles of free and fair elections may be the means which might have been employed for securing success in that election, the said election would be nonetheless valid and it would not be permissible to complain of those improprieties, malpractices and unfair means before any forum or under any law with a view to assail the validity of that election. Not much argument is needed to show that any provision which brings about that result is subversive of the principle of free and fair election in a democracy. T ", "203. The vice of declaration contained in part (iii) of clause (4) regarding the validity of the election of the appellant is aggravated by the fact that such a declaration is made after which was then seized of jurisdiction had found substance in some of the grounds advanced by the respondent and had consequently declared the election of the appellant to be void. To put a stamp of validity on the election of candidate by saying that the challenge to such an election would not be governed by any election law and that the said election in any case would be valid and immune from any challenge runs counter to accepted norms of free and fair elections in all democratic countries. In the case of v. , said that \"the government of the United States has been emphatically termed a government of laws and not of men\". In United States v. , observed that\" no man is so high that he is above the law... All... officers are creatures of the law and are bound t ", "204. It has been argued on behalf of the appellant that the grounds on account of which the election of the appellant has been held to be void by were of a technical nature. I need not express any opinion about this aspect of the matter at this stage but, assuming it to be so, I find that clause (4) of Article 329A is so worded that however serious may be the malpractices vitiating the election of the Speaker or the Prime Minister, the effect of clause (4) is that the said election would have to be treated as valid. I cannot accede to the submission that in construing clause (4) we should take into account the facts of the appellant's case. This is contrary to all accepted norms of construction. If a clause of a Constitution or a statutory provision is widely worded, the width of its ambit cannot be circumscribed by taking into account the facts of an individual case to which it applies. As already mentioned, clause (4) deals with the past election not merely of the Prime Minister but also of ", "205. Another argument advanced in support of the validity of the amendment is that we should take it that the constituent authority constituted itself to be the forum for deciding the dispute relating to the validity of the election of the appellant, and after considering the facts of the case, declared the election of the appellant to be valid. There is, however, nothing before us as to indicate that the constituent authority went into the material which had been adduced before relating to the validity of the election of the appellant and after considering that material held the election of the appellant to be valid. Indeed, the statement of objects and reasons appended to the Constitution (Thirty-ninth Amendment) Bill makes no mention of this thing. In any case, the vice of clause (4) would still lie in the fact that the election of the appellant was declared to be valid on the basis that it was not to be governed by any law for settlement of election disputes. Although the provisions of a c ", "206. The matter can also be looked at from another angle. The effect of impugned clause (4) is to take away both the right and the remedy to challenge the election of the appellant. Such extinguishment of the right and remedy to challenge the validity of the election, in my opinion, is incompatible with the process of free and fair elections. Free and fair elections necessarily postulate that if the success of a candidate is secured in elections by means which violate the principle of free and fair elections, the election should on that account be liable to be set aside and be declared to be void. To extinguish the right and the remedy to challenge the validity of an election would necessarily be tantamount to laying down that even if the election of a candidate is vitiated by the fact that it was secured by flagrant violation of the principles of free and fair election, the same would still enjoy immunity from challenge and would be nonetheless valid. Clause (4) of Article 329A can, therefore, be held to st ", "207. I agree that it is not necessary in a democratic set-up that disputes relating to the validity of the elections must be settled by courts of law. There are many countries like France, Japan, and the United States of America where consistently with the democratic set-up the determination of such controversies is by or by authorities other than the courts. The question with which we are concerned, however, is whether it is permissible in a democratic set-up that a dispute with regard to the validity of a particular election shall not be raised before any forum and shall not be governed by law and whether such an election can be declared, despite the existence of a dispute relating to its validity, to be valid by making the existing law relating to election disputes not applicable to it and also by not applying any other election law to such a dispute. The answer to such a question, for the reasons given earlier by me, should be in the negative. ", "208. Reference to the election of the US President made by Mr. is also not helpful to him. It is clear from observations on pages 47-50 of the American Commonwealth by , 1912 Ed. and Sections 5, 6, and 15 of the United States Code (1970 Ed.) that there is ample provision for the determination of such disputes after the poll. The fact that such determination of the dispute is before the declaration of the result would not detract from the proposition that it is essential for free and fair elections that there should be a forum and law for the settlement of such disputes relating to the validity of the election. ", "209. Argument has also been advanced that the offices of the Prime Minister and Speaker are of great importance and as such they constitute a class by themselves. This argument, in my opinion, would have relevance if instead of the law governing disputes relating to the election of other persons, another law had been prescribed to govern the dispute relating to the election of a person who holds the office of the Prime Minister or Speaker. As it is, what we find is that so far as the dispute relating to the election of the appellant is concerned, neither the previous law governing the election of persons holding the office of the Prime Minister is to apply to it nor the future law to be framed under clause (1) of Article 329A governing the election of persons holding the office of Prime Minister is to apply to this dispute. Likewise, the previous forum for adjudicating upon the election dispute which went into the matter, has been divested of its jurisdiction with retrospective effect and, at the same time, ", "210. It has been argued in support of the constitutional validity of clause (4) that as a result of this amendment, the validity of one election has been preserved. Since the basic structure of the Constitution, according to the submission, continues to be the same, clause (4) cannot be said to be an impermissible piece of constitutional amendment. The argument has a seeming plausibility about it, but a deeper reflection would show that it is vitiated by a basic fallacy. Law normally connotes a rule or norm which is of general application. It may apply to all the persons or class of persons or even individuals of a particular description. Law prescribes the abstract principles by the application of which individual cases are decided. Law, however, is not what called \"a sentence\". According to , law, as distinguished from laws, is the system of authoritative materials for grounding or guiding judicial and administrative action recognized or established in a politically organized society o be decided is that if the impugned amendment of the Constitution violates a principle which is part of the basic structure of the Constitution, can it enjoy immunity from an attack on its validity because of the fact that for the future the basic structure of the Constitution remains unaffected. The answer to the above question, in my opinion, should be in the negative. What has to be seen in such a matter is whether the amendment contravenes or runs counter to an imperative rule or postulate which is an integral part of the basic structure of the Constitution. If so, it would be an impermissible amendment and it would make no difference whether it relates to one case or a large number of cases. If an amendment striking at the basic structure of the Constitution is not permissible, it would not acquire validity by being related only to one case. To accede to the amendment advanced in support of the validity of the amendment would be tantamount to holding that even though it is permissible to change the bas ", "211. Lastly, question arises whether we should strike down clause (4) in its entirety or in part. So far as this aspect is concerned, I am of the view that the different parts of clause (4) are so integrally connected and linked with each other that it is not possible to sever them and uphold the validity of part of it after striking down the rest of it. It would indeed be unfair to the appellant if we were to uphold the first part of clause (4) and strike down other parts or even part (iii). As would be apparent from what follows hereafter, the election of the appellant is being upheld by applying the provisions of the R. P. Act as amended by Act 40 of 1975. Such a course would not be permissible if we were to uphold the validity of the first part of clause (4) and strike down the other parts. We would also in that event be creating a vacuum which is the very vice for which we are striking down clause (4). I am, therefore, of the view that clause (4) should be struck down in its entirety. ", "212. In view of my finding that clause (4) strikes at the basic structure of the Constitution, it is not necessary to go into the question as to whether, assuming that the constituent authority took it upon itself to decide the dispute relating to the validity of the election of the appellant, it was necessary for the constituent authority to hear the parties concerned before it declared the election of the appellant to be valid and thus in effect repelled the challenge of the respondent to the validity of the appellant's election. ", "213. As a result of the above, I strike down clause (4) of Article 329A on the ground that it violates the principle of free and fair elections which is an essential postulate of democracy and which in its turn is a part of the basic structure of the Constitution inasmuch as (1) it abolishes the forum without providing for another forum for going into the dispute relating to the validity of the election of the appellant and further prescribes that the said dispute shall not be governed by any election law and the validity of the said election shall be absolute and not consequently be liable to be assailed, and (2) it extinguishes both the right and the remedy to challenge the validity of the aforesaid election. ", "214. We may now deal with Appeal No. 887 of 1975 filed by the appellant. So far as this appeal is concerned, it has been argued by Mr. on behalf of the appellant that the grounds on which the election of the appellant has been declared by to be void no longer hold good in view of the amendment in the R. P. Act by Act 40 of 1975. As against that, Mr. on behalf of the respondent has assailed the validity of Act 40 of 1975. In the alternative, Mr. contends that even if the validity of Act 40 of 1975 were to be upheld, the grounds on which the election of the appellant has been declared to be void would still hold good. ", "215. The question as to whether Act 40 of 1975 is not vitiated by the constitutional infirmity would be dealt with by me subsequently. For the time being I would proceed upon the basis that the statutory amendment in the R. P. Act by Act 40 of 1957 is constitutionally valid. ", "216. Section 10 of Act 40 of 1975, which has been reproduced earlier makes it clear, inter alia, that the provisions of Section 6 , 7 and 8 of the Act shall have retrospective operation, so as to apply to or in relation to any election held before the commencement of this Act, to either of Parliament in respect of which appeal from any order of made in any election petition under the R. P. Act is pending before immediately before such commencement. It is, therefore, obvious that the provision of Section 6 , 7 and 8 of Act 40 of 1975 would be attracted to this case. One of the question which actually arose for determination before was as to what was the date on which the appellant held herself out as a candidate. According to the written statement filed on behalf of the appellant, she held herself out as a candidate from the Rae Bareli constituency on February 1, 1971 when she filed her nomination paper. As against that, the case of the respondent was that t\" ", "unless the context otherwise requires 'candidate' means a person who has been or claims to have been duly nominated as a candidate at any election and any such person shall be deemed to have been a candidate as from the time when with the election in prospect, he began to hold himself out as a prospective candidate.\" ", "The new definition states that\" unless the context otherwise requires, 'candidate' means a person who has been or claims to have been duly nominated as a candidate at any election \". The question as to when a person holds himself out as candidate, therefore, loses its importance in the context of the new definition. ", "217. One of the grounds which weighed with in declaring the election of the appellant to be void was that the appellant committed corrupt practice under the Section 123 (7) of the R. P. Act inasmuch as she obtained and procured the assistance, for the furtherance of her election prospects, of during the period from January 7 to 24, 1971 when was still a gazetted officer in the service of . ", "218. According to clause (7) of Section 123 of the R. P. Act, the following act shall constitute corrupt practice under that clause :\" ", "The obtaining or procuring or abetting or attempting to obtain or procure by a candidate or his agent or, by any other person with the consent of a candidate or his election agent, any assistance (other than the giving of vote) for the furtherance of the prospects of that candidate's election, from any person in the service of the Government and belonging to any of the following classes, namely :- ", "(a) gazetted officers; ", "(b) stipendiary judges and magistrates; ", "(c) members of the armed forces of the union;(d) members of the police forces; ", "(e) excise officers; ", "(f) revenue officer other than village revenue officers known as Lambardars, Malguzars, Deshmukhs or by any other name, whose duty is to collect land revenue and who are remunerated by a share of, or commission on, the amount of land revenue collected by them but who do not discharge any police function; and ", "(g) such other class of persons in the service of the Government as may be prescribed. ", "Explanation. - (1) In this section the expression 'agent' includes an election agent, polling agent and any person who is held to have acted as an agent in connection with the consent of the candidate. ", "(2) For the purposes of clause (7), a person shall be deemed to assist in the furtherance of the prospects of a candidate's election if he acts as an election agent. ", "\"Perusal of the above clause shows that what constitutes corrupt practice under the above clause is the obtaining or procuring or abetting or attempting to obtain or procure by a candidate or his agent or by any person with the consent of a candidate or his election agent any assistance (other than giving of vote) for the furtherance of the prospects of the candidate's election from any person in the person in the service of the Government and belonging to any of the classes specified therein. It is, in my opinion, essential that at the time the impugned act, namely, the obtaining or procuring or abetting or attempting to obtain or procure the assistance of the government servant is done, the person doing the act must be a candidate or his agent or any other person with the consent of a candidate or his election agent. Candidate in this clause would mean a person who has been or who claims to have been duly nominated as a candidate at the election. I am unable to accede to the submission of Mr. ", "219. Mr. has invited our attention to clause (b) of Section 100 (1) of the R. P. Act wherein it is stated that subject to the provisions of sub-section (2) of the section if is of the opinion that any corrupt practice has been committed by a returned candidate or his election agent or by any other person with the consent of a returned candidate or his election agent, shall declare the election of the returned candidate to be void.\"Returned candidate\" has been defined in clause (f) of Section 79 to mean, unless the context otherwise requires, a candidate whose name has been published under Section 67 as duly elected. It is urged that as the corrupt practice referred to in clause (b) of Section 100(1) of the R. P. Act would in the very nature of things have to be committed by the returned candidate before his name was published under the Section 67 as duly elected, the words \"returned candidate\" in clause (b) of Section 100(1) must be taken to have been used with a ", "220. Reference has also been made by Mr. to observation on pages 222-3 of Vol. 14 of Halsbury's Laws of England, Third Edition, according to which a candidate at a general election may be guilty of treating even though the treating took place before the dissolution of and consequently before he came within the statutory definition of a candidate. These observations have been made in the context of the statutory provisions in the United Kingdom. Those provisions were couched in the language substantially different from that in which the provision of the R. P. Act in India are couched and as such, in my opinion, not much assistance can be derived from those observations. ", "221. As the appellant filed her nomination paper on February 1, 1971, in view of the amended definition of the word \"candidate\", it would have to be taken that the appellant became a candidate only on February 1, 1971. The result is that even if the finding of that the appellant obtained and procured the assistance of during the period from January 7 to 24, 1971 were assumed to be correct, the appellant shall not be deemed to have committed corrupt practice under Section 123(7) of the R. P. Act. As regards the assistance of which the appellant is alleged to have obtained and procured after January 14, 1971, the controversy stands resolved also by another amendment. According to the case of the appellant, , tendered his resignation by letter, dated January 13, 1971, with effect from January 14, 1971. found that continued to be in the service of till January 25, 1971 which was the date of the notificati ette of the resignation and termination of the service of a person in the service of shall be conclusive proof of his resignation and termination of service and where the date of taking effect of this resignation or termination of service is stated in such publication, also of the fact that such person ceased to be in such service with effect from the said date. in view if the newly added explanation, shall be taken to have ceased to be in government service with effect from January 14, 1971. Any assistance of which the appellant was alleged to have obtained or procured on or after January 14, 1971 would not, therefore, make her guilty of corrupt practice under Section 123(7) of the R. P. Act. ", "222. Another ground on which declared the election of the appellant to be void was that she committed corrupt practice under Section 123(7) of the R. P. Act inasmuch as she obtained the assistance of the officers of , particularly the District Magistrate, Superintendent of Police, the Executive Engineer, and the Engineer, for construction of rostrums and arrangement of supply of power for loudspeakers in the meetings addressed by her on February 1, 1971 and February 25, 1971 in furtherance of her election prospects. It is not disputed that what was done by the above mentioned officers was in pursuance of official directions and in the discharge or purported discharge of the official duties. This is indeed clear from letter dated November 19, 1969 from , to all State Governments wherein there is reference to rule (6) of the Rules and Instructions for the Protection of the Prime Minister and it is state\" ", "As the security of the Prime Minister is the concern of the all arrangements for putting up the rostrums, the barricades, etc. at the meeting place, including that of an election meeting will have to be made by the Government concerned. . . . ", "started checking (Mrs.) In the case of election meetings, all expenditure on police, setting up of barricades and taking lighting arrangements will be borne by while expenditure on the public address system and any decorative arrangements will be the responsibility of the political party concerned. (The expenditure on all these items, may in the first instance be borne by and then recovered from the political parties concerned.) In regard to the rostrum only 25% of the cost of the rostrum or Rs. 2500.00 whichever is less, shall be contributed by the party as the rostrum has to be of certain specifications because of security considerations. ", "\"Assuming that the finding of fact recorded by in this respect is correct, the appellant can still be not guilty of the commission of corrupt practice under Section 123(7) of the R. P. Act in view of the new proviso which has been inserted at the end of clause (7) of the Section 123 and which reads as under :\" ", "Provided that where any person, in the service of the Government and belonging to any of classes aforesaid, in the discharge or purported discharge of his official duty, makes any arrangements or provides any facilities or does any other act or thing, for, to or in relation to any candidate or his agent or any other person acting with the consent of the candidate or his election agent, (whether by reason of the office held by the candidate or for any other reason), such arrangements, facilities or act or thing shall not be deemed to be assistance for the furtherance of the prospects of that candidate's election. ", "\"The above proviso has also a direct bearing on the allegation of the respondent that the appellant committed corrupt practice under Section 123(7) of the R. P. Act inasmuch as she or her election agent procured the assistance of members of armed forces of the for furtherance of her election prospects because of the fact that the members of the armed forces arranged planes and helicopters of for her flights to enable her to address meetings in her constituency. ", "223. It has been argued by Mr. that the words \"in the discharge or purported discharge of his official duty\" in the above mentioned proviso have reference only to statutory duty and not to other duty performance of which takes place in pursuance of administrative instructions. I find it difficult to accede to the above submission as there is nothing in the above proviso to confine the words \"official duty\" to duty imposed by statute. Official duty would include not merely duties imposed by statutes but also those which have to be carried out in pursuance of administrative instructions. ", "224. Mr. during the course of arguments made it plain the apart from his submission with regard to the validity of Act 40 of 1975, his objection relating to the applicability of Act 40 of 1975 was confined to two matters, namely, the connotation of the word \"candidate\" and the meaning to be the attached to official duty. Both these objections have been found by me to be not tenable. I would, therefore, hold that subject to the question as to whether the provisions of Act 40 of 1975 are valid, the grounds on which has declared the election of the appellant to be void no longer hold good for declaring the said election to be void. ", "225. We may also before dealing with the validity of Act 40 of 1975 refer to one other change brought about by that Act which has a bearing upon the present case. It was the case of the respondent that the appellant and her election agent made extensive appeals to the religious symbol of cow and calf and thereby committed corrupt practice under Section 123(3) of the R. P. Act. Corrupt practice has been defined in that provision as under :\" ", "(3) The appeal by a candidate or his agent or by any other person with the consent of a candidate or his election agent to vote or refrain from voting for any person on the ground of his religion, race, caste, community or language or the case of, or appeal to religious symbols or the use of, or appeal to, national symbols, such as the national flag or the national emblem, for the furtherance of the prospects of the election of that candidate or for prejudicially affecting the election of any candidate. ", "\"It is common case of the parties that the symbol of cow and calf was allotted to the party by . The learned Counsel for the respondent stated during the course of arguments in that he confined his case only to the use of the symbol of cow and calf. The learned Counsel gave up that part of the case of the respondent wherein it had been alleged that appeals were made to the religious symbol of cow and calf by the appellant. The following proviso has now been inserted in clause (3) of Section 123 by Section 8 of Act 40 of 1975 :\" ", "Provided that no symbol allotted under this Act to a candidate shall be deemed to be a religious symbol or a national symbol for the purposes of this clause. ", "\"It is, therefore, apparent in view of the above proviso that the symbol of cow and calf which was allotted to the appellant shall no be deemed to be a religious symbol or a notional symbol for the purpose of Section 123(3) of the R. P. Act. The appellant as such cannot be deemed to have committed a corrupt practice under Section 123(3) of the R. P. Act by use of the symbol of cow and calf. ", "226. In assailing the validity of Act 40 of 1975 Mr. has referred to Section 10 of that Act, according to which the amendments made by Sections 6 , 7 and 8 of the Act in the R. P. Act shall have retrospective operation, so as to apply to any election held before the commencement of the Act in respect of which an election petition is pending or in respect of which appeal from any order of is pending immediately before the commencement of Act 40 of 1975. It is urged that a change in the election law with retrospective effect strikes at the principle of free and fair elections. Retrospective operation of the amending Act, according to the learned Counsel, has the effect of condoning what was at the time it was committed a corrupt practice. ", "227. I have given the matter my earnest consideration, and am of the opinion that there is no substance in the above contention. A has, except in a matter for which there is prohibition like the one contained in Article 20(1) of the Constitution, the power to make laws which are prospective in operation as well as laws which have retrospective operation. There is no limitation on the power of the in this respect. Essentially it is a matter relating to the capacity and competence of the . Although most of the laws made by the have prospective operation, occasions arise quite often when necessity is felt of giving retrospective effect to a law. This holds good both in respect of a principle Act as well as in respect of an amending Act. If the provisions of an Act passed by the are not violative of the provisions of the Act passed by the provisions shall have to be given effect to and the fact that the operation of the Act is prospective or retrospectiv ", "228. The first such case was (supra). It arose out of elections to the Cuttack Municipality held in December, 1957 to March, 1958 as a result of which 27 appellants were declared elected as councillors. The respondent, who was defeated at the elections, filed a writ petition before the High court challenging the elections. held that the electoral rolls had not been prepared in accordance with the provisions of the Orissa Municipalities Act, 1950, as the age qualification had been published too late thereby curtailing the period of claims and objections to the preliminary roll to 2 days from 21 days as prescribed. The High court consequently set aside the elections. The State took the view that the judgment affected not merely the Cuttack Municipality but other municipalities also. Accordingly, the Governor promulgated an Ordinance validating the elections to the Cuttack Municipality and validating the electoral rolls prepared in respect of various munici\" ", "The Cuttack municipal elections had been set aside by and if the governor thought that in the public interest, having regard to the factors enumerated in the preamble to the Ordinance, it was necessarily follow that the Ordinance suffers from the vice of contravening Article ", "14.\" ", "It was further observed : ", "\" Therefore, if the infirmity in the electoral rolls on which the decision of the High court in the earlier writ petition was based, had not been applicable to the electoral rolls in regard to other municipalities in the State of Orissa, then it may have been open to the Governor to issue an ordinance only in respect of the Cuttack municipal elections, and if, on account of special circumstances or reasons applicable to the Cuttack municipal elections, a law was passed in respect of the said elections alone, it could not have been challenged as unconstitutional under Article ", "14. Similar, if Mr. was the only litigant affected by the decision and as such formed a class by himself, it would have been open to the to make a law only in respect of his case. But as we have already pointed out, the Ordinance does not purport to limit its operation only to the Cuttack Municipality; it purports to validate the Cuttack municipal elections and the electoral rolls in respect of other municipalities as wel ", "229. In v. (supra) the dispute related tot he election of the appellant to . The appellant in that case had been appointed as a Special Government Pleader to represent the State of Rajasthan in an arbitration case. The appellant then stood for election to and was declared elected. The election of the appellant was challenged inter alia on the ground that the appellant held an office of profit within the meaning of Article 19(1) of the Constitution. set aside the election of the appellant. The appellant then came up in appeal to this Court. During the pendency of the appeal, Rajasthan Act 5 of 1969 was passed declaring among others that the holder of the office of Special Government Pleader was not disqualified from being chosen or for being a member of . The Act was made retrospective and removed the appellant's disqualification retrospectively. On the question as to g that the appellant held an office of profit. All the five Judges constituting were, however, unanimous on the point that the Act of 1969 had removed the disqualification of the appellant retrospectively. , C. speaking for himself and , observed : ", "\"It is also well-recognised that and can make their laws operate retrospectively. Any law that can be made prospectively may be made with retrospective operation except that certain kinds of laws cannot operate retroactively. This is not one of them. ", "This position being firmly grounded we have to look for limitations, if any, in the constitution. Article 191 (which has been quoted earlier) itself recognises the power of to declare by law that the holder of an office shall not be disqualified for being chosen as a member. The article says that a person shall be disqualified if he holds an office of profit under or unless that office is declared by the legislature not to disqualify the holder. Power is thus reserved to of make the declaration. There is nothing in the words of the article to indicate that this declaration cannot be made with retrospective effect.\"It was further observed : ", "\" Regard being had to the legislative practice in this country and in the absence of a clear prohibition either express or implied we are satisfied that the Act cannot be declared ineffective in its retrospective operation.\" ", ", (as he then was) speaking for himself, , (as he then was) and was , dealt with the matter in the following words : ", "\"Mr. . learned Counsel for the respondent, contends that was not competent 'to declare retrospectively' under Article 191(1) (a) of the Constitution. It seems to us that there is no force in this contention. It has been held in numerous cases by this Court that the State Legislatures and can legislate retrospectively subject to the provisions of the Constitution. Apart from the question of fundamental rights, no express restriction has been placed on the power of State, and we are unable to imply, in the context, any restriction. Practice of the British does not oblige us to place any implied restriction. We notice that the British in one case validate the election : [Erskine May's Treatise on the Law, Privileges Proceedings & Usage of - Seventeenth Edition (1964)] - ", "'After the general election of 1945 it was found that the persons elected for the Coatbridge Division of Lanark and the Springbourn Division of Glassgow were disqualified at the time of their election because they were members of tribunals appointed by the Minister under the Rent of Furnished Houses Control (Scotland) Act, 1943, which entitled them to a small fee in respect of attendance at a tribunal. reported that the disqualification was incurred inadvertently, and in accordance with their recommendation the Coatbridge and Springbourn Elections (Validation) Bill was introduced to validate the irregular elections (H. C. Deb. (1945-46) 414, c. 564-6). See also H. C. 3 (1945-46); ibid. 71 (1945-46) and ibid. 92 (1945-46).'We have also noticed two earlier instances of retrospective legislation, e.g. the House of Commons (Disqualification) Act, 1813 (Halsburry's Statutes of England p. 467) and Section 2 of the Re-election of Ministers Act, 1919 (ibid p. 515) Great stress was laid on the word 'declare' in Article 19(1) (a ), but we are unable to imply any limitation on the powers of the from this world. Declaration can be made effective as from an earlier date\" ", "230. The above two authorities of this Court clearly lend support for the view that it is permissible to amend a lawn relating to elections with retrospective operation. Mr. has criticised the observations of , reproduced above on the score that in the United Kingdom amendments in election law have not been made to affect pending proceedings in courts. This is essentially a matter for the to decide, this does not affect the competence of the to make a change in election law with retrospective effect. In any case, the proposition of law laid down in the case of (supra) is binding upon us and I do not find any reason to detract either from the soundness of the view expressed therein or its binding effect. ", "231. also upheld in the case of v. an Order in Council giving retrospective effect to an election law in Ceylon. This question arose in the following circumstances. An order in made provision as to in Ceylon but reserved to His Majesty power to revoke, alter or amend the Order. The appellant, as common informer, brought an action to recover penalties under the Order from the respondent, who he alleged had sat and voted after his seat had become vacant under its provisions by reason of his having pecuniary interest in a contract with the Government. In 1928, after the action had been brought, but before its trial, an amending Order in Council was made providing that the action should be dismissed; it also amended the Order of 1923 so as to except the office held by the respondent from its operation. It was held that the Order of 1928 was valid, having regard to the power reserved by the Order of 1923, and was an effective defense \"It was argued that the Order in Council of November 1, 1928, was ultra vires as affecting to take away rights already in existence, thus having a retrospective action. The effect, however, of the Order of 1928, as expressed on the face of it, was no more than an act of indemnity and relief in respect of penalties incurred. It may be true that not himself upon the past hath power, but legislators have certain the right to prevent, alter or reverse the consequence of their own decrees. There is no necessity to give instances to prove that they have frequently done so; even going so far as to restore the heritable quality to blood which had been deprived of its virtue by acts of attainder.\" ", "232. I am not impressed by the argument that retrospective operation of the relevant provisions of Act 40 of 1975 affects free and fair elections. The said provisions of Act 40 of 1975 are general in terms and would apply to all election disputes which may be pending either in or in appeal before or which may arise in future. It is no doubt true that the retrospective operation of an amending Act has the effect of placing one of the parties to the dispute in a more advantageous position compared to others but that is inevitable in most of the amendments with retrospective operation. This Court in the case of v. dealt with the provisions of Section 3 of the Punjab Pre-emption (Repeal) Act, 1973, according to which on and from the date of commencement of that Act, no court shall pass a decree in any suit for pre-emption. This Court held that the above provision was also applicable to appeals which were pending at the commencement of that Act as an ap \"It is true that it gave an advantage to those who stand when the disqualification was not so removed as against those who may have kept themselves back because the disability was not removed. That might raise questions of the propriety of such retrospective legislation but not of the capacity to make such laws.\" ", "Likewise, , J. expressly rejected the contention that retrospective amendment in election law was bad because it was not a healthy practice and because such a course was liable to be abused in the following words : ", "\"The apprehension that it may not be a healthy practice and this power might be abused in a particular case are again no grounds for limiting the powers of .\" ", "233. The above observations also provide an answer to the contention of Mr. that the provisions of the amendment made by Act 40 of 1975 can be abused. I may stated that in case the provisions of the amended law are abused, and some of the instances of abuse were visualized by Mr. during the course of arguments, this Court would not be helpless in the matter. The proper course in such an event would be to strike down the action taken under the amended law and not the law itself. ", "234. Reference was also made by Mr. to the effect of retrospective amendment in cases which may arise under Section 123(1) of the R. P. Act. We are in the present case not concerned with Section 123(1) of the R. P. Act and consequently it is not necessary to express any opinion with regard to the impact of the amendment upon Section 123(1) of the R. P. Act. Nor is it necessary to express opinion on the point as to whether it is permissible to make a law which has the effect of creating a corrupt practice or disqualification retrospectively and thus unseating a returned candidate as such a question does not arise in this case. ", "235. The change in the definition of the word \"candidate\" to which our attention has been invited by Mr. does not impinge upon the process of free and fair elections. The fact that as a result of the above change, we have to take into account only the prejudicial activity of the candidate or his election agent from the date of nomination of the candidate and not from the date he holds himself out as a candidate does not affect the process of free and fair elections. It is necessary while dealing with corrupt practice relating to elections to specify the period within which the impugned act, alleged to constitute corrupt practice should have been done. As a result of the amendment, the has fixed the said period to be as from the date of nomination instead of the period as from the date on which the candidate with the election in prospect began to hold himself out as a prospective candidate. It is common experience that the date from which a candidate holds himself out as a prospecti ", "236. One of the objects of the change effected by Act 40 of 1975 is to remove the uncertainty and set at rest the controversy as to what would be the precise date of a person in the service of ceasing to be in such service in case he tenders his resignation. The amended law makes it clear that where the date of taking effect of the resignation is stated in the publication in , it shall be that date. Similarly, in the case of appointment of a person, the date of taking effect of such appointment shall be the date mentioned in the publication in in case such a date is stated in such publication. The fact that the new provision creates a conclusive presumption with regards to the date of taking effect of appointment or resignation does not mean, as is sought to be argued on behalf of the respondent, that there has been an encroachment by the upon the Judicial sphere. Laying down a rule of conclusive presumption in a statute with a view I find it difficult to hold that the impugned provisions impinge upon the principle of free and fair elections. ", "237. So far as the newly added proviso to Section 123(7) is concerned, it may be stated that the act in the discharge or purported discharge of official duty of the government employees referred to above would in the very nature of things have to be of a kind which is Germans to their official duties. It may include steps taken by the government employees for maintenance of law and order or in connection with the security of a candidate or other persons. It would not, however, include canvassing or doing such acts which may properly be considered to be part of the election propaganda for furtherance of the prospects of a candidate's election. In taking action under the above provision, it must be borne in mind as stated on page 152 of Free Elections by that in the last resort. ", "\"the system of free elections depends on a certain separation of powers between administrators (or policemen) and politicians : there must be some public sense that police and administration serve the public, not the party leaders.\" ", "What would be permissible under the above provision would be that which is conceived to be done in public interest and not something conceived to be done in the personal interest of a candidate. In spite of some difficulty which may arise in borderline cases, this distinction must be borne in mind. If, however, because of doing something conceived in public interest e.g., as in the present case the security arrangement for the person holding the office of the Prime Minister, some advantage may also possibly accrue to a candidate, it will have to be regarded as incidental and would not detract from action taken under the above provision being in public interest. As against that, any action taken with a view to further the personal interest of a candidate should not be allowed to be camouflaged as an action taken in public interest. Care must be taken to ensure that public interest is not allowed to degenerate into a cloak for furtherance of the personal interests of a candidate in an election. The discharge o ", "238. One other change brought about by Act 40 of 1975 is the addition of an explanation in Section 77 of the R. P. Act. According to the new explanation, any expenditure incurred in respect of any arrangements made, facilities provided or any other act or thing done by any person in the service of the and belonging to any of the classes mentioned in clause (7) of Section 123 in the discharge or purported discharge of his official duty as mentioned in the proviso to that clause shall not be deemed to be expenditure in connection with the election incurred or authorised by a candidate or by his election agent for the purposes of Section 77(1) . The validity of the above explanation in a great measure is linked with the validity of the new proviso to Section 123(7) of the R. P. Act, and for the reasons stated for upholding the proviso to Section 123(7) , the new explanation to Section 77 , it seems, may have also to be upheld. It is not necessary to dilate upon this aspect because even without invoking ", "239. Argument has also been advanced that validity of Act 40 of 1975 cannot be assailed on the ground that it strikes at the basis structure of the Constitution. Such a limitation it is submitted, operates upon an amendment of the Constitution under Article 368 but it does not hold good when enacts a statute in exercise of powers under Article 245 of the Constitution. In view of my finding that the provisions of Act 40 of 1975 with which we are concerned have not been shown to impinge upon the process of free and fair elections and thereby to strike at the basic structure of the Constitution, it is not necessary to deal with the above argument. I would, therefore, hold that the provisions of Act 40 of 1975 with which we are concerned are valid and do not suffer from any constitutional infirmity. ", "240. We may now deal with Cross Appeal No. 909 of 1975. Mr. has not pressed the challenge to the findings of on issues Nos. 4 and 7. He has, however, assailed the finding of on issue No., 9 whereby held that the appellant incurred an expenditure of Rs. 31, 976.47 on her election as against the prescribed limit of Rs. 35, 000. In Ex. 5, return of her election expenses, the appellant showed her total election expenses to be Rs. 12, 892.97. The respondent in para 113 of the election petition alleged that the appellant and her election agent had incurred expenditure much beyond the prescribed limit of Rs. 35, 000 and thereby committed corrupt practice under Section 123(6) of the R. P. Act. The respondent gave some items of the expenditure which were alleged to have been incurred by the appellant and her election agent but were not shown in the return of the election expenses. The material items with which we are now concerned were as under :(i) The hiring charges of the vehicles specified in para 13(1) .. ... over Rs. 1, 28, 700 ", "(ii) Cost of petrol and diesel for the vehicles specified in para 13(1) .. ... over Rs. 43, 230 ", "(iii) Payments made to the drivers of vehicles specified in para 13(1) .. ... over Rs. 9, 900 ", "(iv) Repairing and servicing charges of vehicles specified in para 13(1) .. ... over Rs. 5, 000 ", "(v) Payments made to the workers engaged for the purpose of election propaganda .. ... over Rs. 6, 600 ", "(vi) Expenses on the erection of rostrums for the public meetings addressed by the appellant in the constituency on February 1 and 25, 1971 .. ... over Rs. 1, 32, 000 ", "(vii) Expenses on arrangement of loudspeakers for the various election meetings of the appellant addressed on February 1 and 25, 1971 .. ... over Rs. 7, 000 ", "(viii) Expenses on motor transport for the conveyance of the appellant and her party to the place of her election meetings on February 1 and 25, 1971 .. ... over Rs. 2, 000 held that the respondent had failed to prove the first five times. As regards the expenses for the erection of rostrums for the public meetings addressed by the appellant on February 1 and 25, 1971, found that four meetings were addressed by the appellant in the constituency on February 1 and six meetings on February 25, 1971. The cost of a rostrum in each meeting came to Rs. 1, 600. The total expenses of the ten rostrums thus came to Rs. 16, 000 and the same, it was held, was liable to be added to the amount shown in the return of election expenses of the appellant. The amount of Rs. 16, 000 included the money paid by as its share of the cost of rostrums. Regarding the expenses of loudspeakers, found that the total expenses of Rs. 800 had been incurred on the installation of loudspeakers in the meetings addressed by the appellant on February 1 and 25, 1971. In addition to that, added Rs. 1, 151 as cost of energy supplied ", "241. In appeal before us Mr. has assailed the finding of in so far as has not accepted the case of the respondent that the appellant incurred expenses on the cost of hiring, petrol, petrol and the salary of the drivers for 23 vehicles. It may be mentioned that the respondent in para 13 of the election petition referred to 32 vehicles which were alleged to have been hired by the appellant, but both before and in appeal before us, learned Counsel for the respondent had confined his argument to 23 vehicles. ", "242. To appreciate the point of controversy between the parties, it may be necessary to set out some material facts. Section 160 of the R. P. Act provides inter alia that if it appears to that in connection with an election held within the State, any vehicle is needed or is likely to be needed for the purpose of transport of ballot boxes to or from any polling station, or transport of members of the police force for maintaining order during the conduct of such election, or transport of any officer or other person for performance of any duties in connection with such election, the Government may be order in writing requisition such vehicle, provided that no vehicle which is being lawfully used by a candidate or his agent for any purpose connected with the election of such candidate shall be requisitioned until the completion of the poll at such election. It appears that 23 vehicles, described at some places as cars and at other places as jeeps, were requisitioned by the district authoriti \"You are requested to kindly write a letter with your recommendation to the Election Officer so that the cars taken by may be released. I have tried to find out who is contesting the election from Amethi parliamentary constituency and who is contesting the election from Ram Sanehi parliamentary constituency, but they are not available. You are, therefore, requested to write the above letter to the District Election Officer positively so that the election work of all the three parliamentary constituencies which is going on, on behalf of , may not suffer.\" ", "On February 25, 1971 addressed a letter to the District Officer, Rae Bareli, stating that the 23 vehicles in question had been taken by the District Congress committee, Rae Bareli, for the three parliamentary constituencies of Rae Bareli, Amethi and Ram Sanehi Ghat. The District Officer was requested to release the 23 vehicles without delay. also enclosed with that letter the note of . The 23 vehicles, it would appear, were thereafter released by the District Election Officer. The appellant, in para 17(b) of her written statement, admitted that those 23 vehicles were used by , Rae Bareli, for election work in the three parliamentary constituencies of Rae Bareli, Amethi and Ram Sanehi Ghat. , in not accepting the case of the respondent in respect of the 23 vehicles, observed that there was nothing to show that the above mentioned vehicles had been obtained on hire or were obtained gratis. There was also, according to the ", "243. Mr. , while assailing the finding of , has submitted that, as five out of the seven assembly constituencies in Rae Bareli district were in Rae Bareli parliamentary constituency, five-seventh of the expenses incurred on the said 23 vehicles should be added to the election expenses of the appellant. I find it difficult to accede to the above submission because of the paucity of the material on record. There is no cogent evidence to show that the 23 vehicles in question were used for the election of the appellant. It is no doubt true that the said 23 vehicles were used by , Rea Bareli for election work in the three parliamentary constituencies, viz., Rae Bareli, Amethi and Ram Sanehi Ghat. The record is, however silent on the point as to what extent they were used in Rae Bareli parliamentary constituency. One can in the above context visualise three possibilities :(i) As the appellant, who was the Prime Minister of the country, was contesting from Rae Bareli constituency, concentrated its attention o that costituency and used the 23 vehicles mostly for the election work in that constituency. ", "(ii) As the appellant had a mass appeal the office bearers thought that the constituency was very safe and used the 23 vehicles mostly for those two constituencies. ", "(iii) Equal attention was paid to all the three costituecies and there was proportionate use of the vehicles for the three constituencies. ", "Mr. would have us to accept the first or the third possibility and would rule out the second. If so, it was, in my opinion, essential for the respondent to lead some evidence regarding the use of the 23 vehicles. He did nothing of the kind. Neither the owners nor the drivers of those vehicles were examined as witnesses. There was also, as mentioned earlier, no other cogent evidence to show that those vehicles or any them were used for the appellant's election in the Rae Bareli constituency, and if so, to what extent. The respondent himself did not come into the witness box to substantiate the charge against the appellant regarding the use of the 23 vehicles. The fact that was not examined as a witness on behalf of the appellant would not warrant the filling in of the gaps and lacunae in the evidence adduced by the respondent by a process akin to guess work. It is no doubt true that by using a vehicle for the furtherance of the prospects of candidates in more than one constitue s was used in more than one constituency, including that of the returned candidate who was a nominee. Question arose as to whether the expense incurred in connection with that jeep could be included in the election expenses of the returned candidate. While answering the question in the negative, , C.J. observed : ", "\"The bill stands in the name of and was presumably paid by also. The evidence, however, is that this jeep was used on behalf of the returned candidate and to that extent we subscribe to the finding given by the learned Judge. Even if it be held that the candidate was at bottom the hirer of the jeep and the expenditure on it must be included in his account, the difficulty is that this jeep was used also for the general propaganda in other constituencies. As we stated, the jeep remained in Chalet and at Mubarakpur. No doubt Chalet is the home town of the returned candidate and his office was situated at Mubarakpur but that does not indicate that the jeep was used exclusively on his account. The petrol chart shows that petrol was bought at several pumps, both inside the constituency and outside. This shows, as does the evidence, that the jeep was used not only in this constituency but also in the other constituencies. If this be true, then, it is almost imp ", "244. Reference has also been made during the course of arguments by Mr. to some entries in a register of . declined to place any reliance on those entries as those entries had not been proved. I see no cogent ground to take a different view. Our attention has been invited by Mr. to a report in issue dated January 22, 1971 of wherein there was a reference to the Personal Secretary of the Prime Minister having reached Rae Bareli with a caravan of 70 motor vehicles. No reliance can be placed upon that report as the correspondent who sent that report was not examined as a witness. ", "245. The other difficulty which I find in accepting the submission of Mr. in respect of 23 vehicles is that there is no evidence to show that any payment was made for the use of the above mentioned vehicles. There is also nothing to show that those vehicles were engaged on hire. As mentioned earlier, the owners and drivers of those vehicles were not examined as witnesses. I, therefore, find no sufficient ground to interfere with the finding of in respect of the above mentioned 23 vehicles. ", "246. Mr. has next assailed the finding of in so far as it has held that the respondent has failed to prove that the appellant incurred an expense of Rs. 6, 600 on workers engaged for the purposes of election propaganda. I, however, find no infirmity in the finding of in this respect as there is no cogent evidence whatsoever that any expense was incurred for engaging workers for the election work of the appellant. The case of the appellant is that her workers did the work voluntarily and without receipt of any remuneration. ", "247. Apart from challenging the findings of in respect of 23 vehicles and the alleged payment to workers, Mr. has also referred to some other circumstances with a view to show that the election expenses of the appellant exceeded the prescribed amount of Rs. 35, 000. It has been pointed out that a cheque for Rs. 70, 000 was sent by to , President of , Rae Bareli, and the same was credited in 's account after deducting of the bank charges on March 4, 1971. withdrew out of that amount Rs. 40, 000 and Rs. 25, 000 on March 4 and 6, 1971, respectively nearabout the days of polling. It is urged that the said amount must have been spent for the purpose of the elections. There was no reference to the said amount of Rs. 70, 000 in the petition. There is also no reference to the amount of Rs. 70, 000 in the judgment of or in the grounds of appeal. As such, I am of t\" ", "Learned Counsel for the petitioner urged that from the evidence on record, it transpires that expenditure was also incurred on the telephone connection and telephone charges; on the meetings addressed by Sri within the constituency during the period of election; on the election material viz., pamphlets, posters, etc. and on the lighting arrangements made for some meetings addressed by the respondent No. 1. None of these expenses were, however, pleaded in the petition. In fact, till the commencement of the arguments in the case, the respondent No. 1 could not even anticipate that the petitioner shall rely on these expenses for the purpose of his case. It will, therefore, be prejudicial to the interest of respondent No. 1 if the aforesaid expenses are taken into consideration. The submission made by learned Counsel for the petitioner is accordingly negatived \".I am in full agreement with the above observations of and find no cogent ground to take a different view. ", "248. It may be stated that in view of the new explanation added to Section 77 of the R. P. Act by Act 40 of 1975, the amount of Rs. 12, 000 which represented 75 per cent of the expenditure incurred on the construction of 10 rostrums borne by the Government cannot be included in the total election expenses of the appellant. , however, included the total amount of Rs. 16, 000 in the election expenses of the appellant upon the assumption that the appellant had not disavowed that expenditure. Be that as it may, the fact remains that has found on issue No. 9 that the total expenses incurred by the appellant on here election have not been shown to exceed the prescribed limit. I find no cogent reason to interfere with that finding. ", "249. I also agree with that as the election expenses of the appellant have not been shown to exceed the prescribed limit of Rs. 35, 000, the question of invoking and going into the validity of Act 58 of 1974 does not arise. Nor is it necessary to express an opinion about the view taken in v. in view of the fact that even after applying the rule laid down in that case, the total election expense of the appellant has not been shown to exceed the prescribed limit. ", "250. So far as the finding of on issue No. 6 regarding the use of the symbol of cow and calf is concerned, the matter, as already discussed earlier, is now covered by the amendment made in Section 123(3) of the R. P. Act by Section 8 of Act 40 of 1975. ", "251. There was a controversy during the course of arguments on the point as to whether I have laid down in my judgment in case (supra) that fundamental rights are not a part of the basic structure of the Constitution. As this controversy cropped up a number of times, it seems apposite that before I conclude I should deal with the contention advanced by learned Solicitor General that according to my judgment in that case no fundamental right is part of the basic structure of the Constitution. I find it difficult to read anything in that judgment to justify such a conclusion. What has been laid down in that judgment is that no article of the Constitution is immune from the amendatory process because of the fact that it relates to a fundamental right and is contained in Part III of the Constitution. It was also held that a constitution amendment under Article 368 does not constitute \"law\" as mentioned in Article 13. I also did not agree with the view taken in the case of that the\" ", "I am further of the opinion that amendment of the Constitution necessarily contemplates that the Constitution has not to be abrogated but only changes have to be made in it. The word 'amendment' postulates that the old Constitution survives without loss of identity despite the change and continues even though it has been subjected to alterations. As a result of the amendment, the old Constitution cannot be destroyed and done away with; it is retained though in the amended form. What then is meant by the retention of the old Constitution ? It means the retention of the basic structure or framework of the old Constitution. A mere retention of some provisions of the old Constitution even though the basic structure or framework of the Constitution has been destroyed would not amount to the retention of the old Constitution. Although it is permissible under the power of amendment to effect changes, howsover important, and to adapt the system to the requirements of changing conditions, it is not permissible to to It was further observed by me : ( p. 770, para 1435) \"The word 'amendment' in Article 368 must carry the same meaning whether the amendment relates to taking away or abridging fundamental rights in Part III of the Constitution or whether it pertains to some other provision outside Part III of the Constitution. No serious objection is taken to repeal, addition or alteration of provisions of the Constitution other than those in Part III under the power of amendment conferred by Article 368. The same approach, in my opinion, should hold good when we deal with amendment relating to fundamental rights contained in Part III of the Constitution. It would be impermissible to differentiate between scope and width of power of amendment when it deals with fundamental rights and the scope and width of that power when it deals with provisions not concerned with fundamental rights.It would appear from the above that no distinction was made by me so far as the ambit and scope of the power of amendment is concerned between a provision relating to fundamental rights and provisions dealing with matters other than fundamental rights. The limitation inherent in the word \"amendment\" according to which it is not permissible by amendment of the Constitution to change the basic structure of the Constitution was to operate equally on articles pertaining to fundamental rights as on other articles not pertaining to those rights. This was further made clear by the following observations on page 688 : ( p. 769, para 1434)\" ", "Subject to the retention of the basic structure or framework of the Constitution, I have no doubt that the power of amendment is plenary and would include within itself the power to add, alter or repeal the various articles including those relating to fundamental rights \". ", "Proposition (vii) of the summary of my conclusions on page 758 of the judgment also bears it out and the same reads as under : (SCC p. 824, para 1537)\" ", "(vii) The power of amendment under Article 368 does not include power to abrogate the Constitution nor does it include the power to alter the basic structure or framework of the Constitution. Subject to the retention of the basic structure or framework of the Constitution, the power of amendment is plenary and includes within itself the power to amend the various articles of the Constitution, including those relating to fundamental rights as well as those which may be said to relate to essential features. No part of a fundamental right can claim immunity from amendatory process by being described as the essence or core of that right. The power of amendment would also include within itself the power to add, alter or repeal the various articles \". ", "252. It has been stated by me on page 685 SCC(p) 767 ) of the judgment (already reproduced above) that the secular character of the , according to which the shall not discriminate against any citizen on the ground of religion only cannot likewise be done away with. The above observations show that the secular character of the Constitution and the rights guaranteed by Article 15 pertain to the basic structure of the Constitution. The above observations clearly militate against the contention that according to my judgment fundamental rights are not a part of the basic structure of the Constitution. I also dealt with the matter at length to show that the right to property was not a part of the basic structure of the Constitution. This would have been wholly unnecessary if none of the fundamental rights was a part of the basic structure of the Constitution. ", "253. Before parting with this case I must acknowledge the assistance we received from the learned Counsel for the parties as also from learned Attorney General and Solicitor General in resolving the points of controversy. In spite of the political overtones, the case was argued forcefully yet without generating any heat and in an atmosphere of befitting calmness. It has been said by , that great cases like hard cases make bad law. For great cases are called great, not by reason of their real importance in shaping the law of the future, but because of some accident of immediate overwhelming interest, which appeals to the feelings and distorts the judgment. These immediate interests exercise a kind of hydraulic pressure ( v. U. S.). It, therefore, became essential to rid the case of all the embellishments resulting from the political overtones and to bring it to a level which is strictly judicial, so that the various constitutional and legal aspects of the matter may be examined\" ", "That all constitutional interpretations have political consequences should not obliterate the fact that the decision has to be arrived at in the calm and dispassionate atmosphere of the court room, that judges in order to give legitimacy to their decision have to keep aloof from the din and controversy of politics and that the fluctuating fortunes of rival political parties can have for them only academic interest. Their primary duty is to uphold the Constitution and the laws without fear or favour and in doing so, they cannot allow any political ideology or economic theory, which may have caught their fancy, to colour the decision \". ", "254. As a result of the above, I accept Appeal No. 887 of 1975 filed by , set aside the judgment of in so far as it has found the appellant guilty of corrupt practice under Section 123(7) of the R. P. Act and has declared her election to to be void. The order that the appellant shall accordingly stand disqualified for a period of six years as provided in Section 8A would also consequently be set aside. The election petition filed by the respondent shall stand dismissed. Appeal No. 909 of 1975 filed by is dismissed. Looking to all the circumstances, more particularly the fact that the election petition filed by the respondent is being dismissed because of changes made in law during the pendency of the appeal, the parties are directed to bear their own costs throughout. ", ", (concurring) - In the election petition filed by the respondent in Civil Appeal No. 887 of 1975 (hereinafter referred to as 'respondent'), seven charges of corrupt practice were made against the appellant therein (hereinafter called the 'appellant') and it was prayed that the election of the appellant be set aside. The learned Judge who tried the petition found that two of the charges had been made out but that the rest of the charges were not substantiated. He set aside the election of the appellant with the result that the appellant incurred the disqualification for a period of six years as visualized in Section 8A of the Representation of the People Act, 1951. It is against this judgment that Civil Appeal No. 887 of 1975 has been filed. ", "256. The respondent has filed a cross appeal (Civil Appeal No. 909 of 1975) challenging the findings of in respect of the other charges of corrupt practice. ", "257. During the pendency of these appeals, the passed the Election Laws (Amendment) Act , 1975 on August 6, 1975 by which certain amendments were made in the provisions of the Representation of the People Act , 1951, and the Indian Penal Code . ", "258. On August 10, 1975, the , in the exercise of its constituent power, passed the Constitution (Thirty-ninth Amendment) Act (hereinafter referred to as the 'Amendment'). By the amendment, Article 71 of the Constitution was substituted by a new article and that article provided by clause (1) that, subject to the provisions of the Constitution, may, by law, regulate any matter relating to or connected with the election of a President or Vice-President, including the grounds on which such election may be questioned. By clause (2) of the article it was provided that all doubts or Vice-President shall be inquired into and decided by such authority or body in such manner as may be provided for by or under any law referred to in clause (1). Clause (3) stated that the validity of any such law referred to in clause (1) and the decision of any authority or body under such law shall not be called in question in any court. ", "259. By clause (4) of the amendment, Article 329-A was inserted reading as follows :\" ", "329-A. Special provision as to elections to in the case of Prime Minister and Speaker. - (1) Subject to the provisions of Chapter II of Part V [except sub-clause (e) of clause (1) of Article 102 ], no election - ", "(a) to either House of Parliament of a person who holds the office of the Prime Minister at the time of such election or is appointed as Prime Minister after such election;(b) to the House of the People of a person who holds the office of a Speaker of that House at the time of such election or who is chosen as the Speaker for that House after such election; ", "shall be called in question except before such authority [not being any such authority as is referred to in clause (b) of Article 329] or body and in such manner as may be provide for all other matters relating to doubts and disputes in relation to such election including the grounds on which such election may be questioned. ", "(2) The validity of any such law as is referred to in clause (1) and the decision of any authority or body under such law shall not be called in question in any court. ", "(3) Where any person is appointed as Prime Minister or, as the case may be, chosen to the office of the Speaker of , while an election petition referred to in clause (b) of Article 329 in respect of his election petition referred to in clause (b) of Article 329 in respect of his election to either House of Parliament or, as the case may be, to is pending, such election petition shall abate upon such person being appointed as Prime Minister or, as the case may be, being chosen to the office of the Speaker of , but such election may be called in question under any such law as is referred to in clause (1). ", "(4) No law made by before the commencement of the Constitution (Thirty-ninth Amendment) Act, in so far as it relates to election petitions and matters connected therewith shall apply or shall be deemed ever to have applied to or in relation to the election of any such person as is referred to in clause (1) to either House of and such election shall not be deemed to be void or ever to have become or has, before such commencement, been declared to be void under any such law and notwithstanding any order made by any court, before such commencement, declaring such election to be void, such election shall continue to be valid in all respects and any such order and any finding on which such order is based shall be and shall be deemed always to have been void and of not effect.(5) Any appeal or cross appeal against any such order of any court as is referred to in clause (4) pending immediately before the commencement of the Constitution (Thirty-ninth Amendment) Act before shall be disposed of in conformity with the provisions of clause (4). ", "(6) The provisions of this article shall have effect notwithstanding anything contained in this Constitution. ", "\"260. The respondent contended that clause (4) of Article 329A [ hereinafter referred to as 'clause (4)'] is invalid for the reason that some of the basic structures of the Constitution have been damaged by its enactment. ", "261. The argument was that although the amending body could declare that the election of the appellant shall not be deemed to be void and the judgment of to be void on the basis that no law relating to election petition and matters connected therewith would apply to the election, yet the amending body could not have held the election to be valid as it did not ascertain the facts relating to the election and apply the relevant law to them. Counsel submitted that by its very nature, an election dispute in a democratic system of government raises questions which can be decided only by the exercise of judicial power; that by retrospectively rendering the forum for investigation into the complaints regarding the validity of the election of the appellant coram non judice, and by the amending body judging its validity without ascertaining the facts and applying the relevant law, the amendment has fundamentally damaged an essential feature of the democratic structure of the Constitution, namely, free ", "262. Counsel also submitted that equality and rule of law are essential features of democracy; that clause (4), by dispensing with the application of the law relating to election petition and matters connected therewith to the appellant, made an unreasonable classification among persons similarly situated with reference to the purpose of the law. ", "263. The further submission was, that separation of powers is a basic structure of the Constitution and that if it be supposed that the amending body ascertained the facts regarding the election of the appellant and applied the relevant law, the exercise of that power by the amending body would offend the doctrine of separation of powers and that, at any rate, this process would not result in an amendment of the Constitution by enacting a law, but only in the passing of a judgment or sentence which can never be characterized as a law, let alone a law relating to the Constitution of India. ", "264. In His Holiness v. State of Kerala (hereinafter referred to as ''s case'), a majority of seven judges held that the power conferred under Article 368 of the Constitution was not absolute. They took the view that, by an amendment, the basic structure of the Constitution cannot be damaged or destroyed. And, as to what are the basic structures of the Constitution, illustrations have been given by each of these judges. They include supremacy of the Constitution, democratic republican form of government, secular character of the Constitution, separation of powers among the , and , the federal character of the Constitution, rule of law, equality of status and of opportunity; justice, social, economic and political; unity and integrity of the nation and the dignity of the individual secured by the various provisions of the Constitution. There was consensus among these judges that democracy is a basic structure of the Constitution. I proce ", "265. Therefore, if by clause (4), any essential feature of the democratic republican structure of our polity as visualized by the Constitution has been damaged or destroyed, the clause would be ultra vires the Constitution. ", "266. One way of looking at the first part of clause (4) is that the amending body has, with retrospective effect, repealed the law relating to election petition in respect of the persons specified in clause (1) and hence the judgment rendered on the basis of the previous law relating to election petition became automatically void, and the amending body was merely stating the consequence of the retrospective repeal of the law and therefore the declaration that the judgment was void was not an exercise of judicial function. On the other hand, it might be possible to view the first part of clause (4) as an exercise of judicial power for the reason that, even assuming that by virtue of the retrospective repeal of the law relating to election petition, there was no jurisdiction in to entertain or try the election petition and pass the judgment, a repeal simpliciter did not render the judgment ipso facto void and therefore, in making the declaration that the judgment was void, the amending body was ", "267. Be that as it may, I feel no doubt that the amending body, when it declared the election of the appellant to be valid, had to ascertain the adjudicative facts and apply the relevant norm for adjudging its validity. If, however, the amending body did not ascertain the facts relating to the election and apply the relevant norm, the declaration of the validity of the election was a fiat of a sui generis character of the amending body. ", "268. The concept of democracy as visualized by the Constitution presupposes the representation of the people in and State Legislatures by the method of election. And, before an election machinery can be brought into operation, there are three requisites which require to be attended to, namely, (1) there should be a set of laws and rules making provisions with respect to all matters relating to, or in connection with, elections, and it should be decided as to how these laws and rules are to be made; (2) there should be an executive charged with the duty of securing the due conduct of elections; and (3) there should be a judicial tribunal to deal with disputes arising out of or in connection with elections. Articles 327 and 328 deal with the first of these requisites, Article 324 with the second and Article 329 with the third requisite (see ). ", "269. Article 329(b) envisages the challenge to an election by a petition to be presented to such authority as the may, by law, prescribe. A law relating to election should contain the requisite qualifications for candidates, the method of voting, definition of corrupt practices by the candidates and their election agents, the forum for adjudication of election disputes and other cognate matters. It is on the basis of this law that the question whether there has been a valid election has to be determined by the authority to which the petition is presented. And, when a dispute is raised as regards the validity of the election of a particular candidate, the authority entrusted with the task of resolving the dispute must necessarily exercise a judicial function, for, the process consists of ascertaining the facts relating to the election and applying the law to the facts so ascertained. In other words, it is obvious that a power must be lodged somewhere to judge the validity of the election, for, othe ", "270. It was contended for the appellant that, in England, it was which originally decided election disputes concerning its members, that it was only in 1770 that the function was delegated to committees and, therefore, is the proper forum for deciding election disputes of its was framed, the decision of an election dispute had ceased to be a privilege of in England and therefore, under Article 105(3 ), it could not be a privilege of in this country. ", "271. Before the year 1770, controverted elections were tried and determined by the whole as mere party questions upon which the strength of contending factions might be tested.\" ", "In order to prevent so notorious a perversion of justice, the consented to submit the exercise of its privilege to a tribunal constituted by law, which, though composed of its own members, should be appointed so as to secure impartiality and the administration of justice according to the laws of the land under the sanction of oaths. ", "\"The principle of the Grenville Act, and of others which were passed at different times since 1770, was the selection by lot of committees for the trial of election petitions. And, at present, by Part III of the Representation of the People Act, the trial of controverted elections is confided to judges selected from the in the appropriate part of the United Kingdom. Provisions is made in each case for constituting a rota from whom these judges are selected. The has not cognizance of these proceedings until their determination, when the judges certify their determination. The judges are to make a report in any case where a charge has been made in the petition of corrupt and illegal practice having been committed at an election; and they may also make a special report on any matter arising which they think should be submitted to the . ", "272. Article 1 , Section 5(1) of the Constitution of the United States of America provides that each shall be the judge of the elections, returns and qualifications of its own members. ", "273. In whichever body or authority the jurisdiction is vested, the exercise of the jurisdiction must be judicial in character. This Court has held that in adjudicating an election dispute an authority is performing a judicial function and a petition for leave to appeal under Article 136 of the Constitution would lie to this Court against the decision notwithstanding the provisions of Article 329(b) (see ). ", "274. In v. United States Ex. Rel. , it was held that in exercising the power to judge of the election returns and qualifications of members, the acts as a judicial tribunal. ", "275. It might be that if the adjudication of election disputes in respect of its members had been vested in each of the s of Parliament by the Constitution, the decision of the would have been final. That would have been on the basis of the doctrine of the political question, namely, that the function has been exclusively committed textually to another agency. I am aware that the doctrine of political question has no hospitable quarter in this Court since the decision in . But I venture to think that the doctrine alone can explain why the courts abstain from interfering with a verdict on an impeachment of the President for violation of the Constitution, a function essentially judicial. ", "276. An election dispute has a public aspect in that it is concerned more with the right of a constituency to be represented by a particular candidate. But it does not follow from the public character of the controversy that there is no lis between the parties to the election contest, and that the lis can be resolved otherwise than by ascertaining the facts relating to the election, and applying the relevant law :\" ", "A judicial inquiry investigates, declares and enforces liabilities as they stand on present or past facts and under laws supposed already to exist. This is its purpose and end. Legislation, on the other hand, looks to the future and changes existing conditions by making a new rule, to be applied thereafter to all or some part of those subject to its power. ", "\"277. had occasion to consider this question in v. . The judgment of the majority was delivered by Lord . Lord and Lord dissented. The question in the case was whether the President of a labour tribunal in Ceylon was the holder of a judicial office. If so, as the man in question has not been appointed in the way the Constitution of Ceylon required for appointments of judicial officers, whether the tribunal was without jurisdiction. It is clear from the judgment of their Lordships of the minority that judicial power is the exercise of a power on the basis of pre-existing law. At pp. 384-385, their Lordships said :\" ", "Another characteristic of the judicial power is that it is concerned with existing rights, that is, those which the parties actually have at the inception of the suit and not those which it may be thought they ought to have; it is concerned with the past and the present and not with the future. ", "\"278. According to the historic analysis, the essence of the distinction between legislative power and judicial power is that the makes new law which becomes binding on all persons over whom the exercises legislative power : the applies already existing law in the resolution of disputes between particular parties; and judges may not deviate from this duty. This view of the distinction between the obligation to apply and enforce rules and a discretion to modify rules or make new rules was at one time applied uncompromisingly in describing functions as legislative or judicial. Thus said that courts of equity as then existing in England had a legislative function. They are, he said, a kind of inferior experimental , continually employed in finding out and providing law remedies for those new species of cases for which neither the courts of common law, nor the have as yet found it convenient or establish any. Though this would show that neither fo ", "279. If, therefore, the decision of the amending body that the election of the appellant was valid was the result of the exercise of judicial power or of despotic discretion governed solely by considerations of political expediency, the question is, whether that decision, though couched in the form of an enactment, can be characterized as an amendment of the Constitution. ", "280. The constituent power is the power to frame a Constitution. The people of India, in the exercise of that power, framed the Constitution and it enacts the basic norms. By that instrument, the people conferred on the amending body the power to amend by way of addition, variation or repeal any of its provisions ( Article 368 ). It is not necessary to go in detail into the question whether the power to amend is coextensive with the constituent power of the people to frame a Constitution. In 's case, I said :\" ", "...... under the Indian Constitution, the original sovereign - the people - created, by the amending clause of the Constitution, a lesser sovereign, almost coextensive in power with itself. The sovereign, the one established by the revolutionary act of the full or complete sovereign has been called by , the \"pro-sovereign\", the holder of the amending power under the Constitution. ", "\"281. I fully appreciate that 'sovereign', if conceived of as an omnipotent being, has no existence in the real world. Several thoughtful writers have deprecated the use of the expression in legal discussion as it has theological and religious overtones. Nevertheless, as the practice has become inveterate, it will only create confusion if any departure is made in this case from the practice. If it is made clear that sovereign is not a 'mortal God' and can express himself or itself only in the manner and form prescribed by law and can be sovereign only when in the manner and form prescribed by law and can be sovereign only when he or it acts in a certain way also prescribed by law, then perhaps the use of the expression will have no harmful consequence.\" ", "'Legal sovereignty' is a capacity to determine the actions of persons in certain intended ways by means of a law... where the actions of those who exercise the authority, in those respects in which they do exercise it, are not subject to any exercise by other persons of the kind of authority which they are exercising. ", "\"282. The point to be kept in mind is that the amending body which exercises the constituent power of the legal sovereign, though limited by virtue of the decision in 's case (supra), can express itself only by making laws. ", "283. The distinction between constitutional law and ordinary law in a rigid Constitution like ours is that the validity of the constitutional law cannot be challenged whereas that of ordinary law can be challenged on the touchstone of Constitution. But constitutional law is as much law as ordinary law. A Constitution cannot consist of a string of isolated dooms. A judgment or sentence which is the result of the exercise of judicial power or of despotic discretion is not a law as it has not got the generality which is an essential characteristic of law. A despotic decision without ascertaining the facts of a case and applying the law to them, though dressed in the garb of law, is like a bill of attainder. It is a legislative judgment. ", "284. According to , a law and a particular command are distinguished in the following manner : a law obliges generally the members of a given community, or a law obliges generally person of a given class. A particular command obliges a single person or persons, whom it determines individually. Most of the laws established by political superiors are, therefore, general in a two-fold manner : as enjoining or forbidding generally acts of kinds or sorts; and as binding the whole community, or, at least, whole classes of its members. He then said :\" ", "Therefore, a particular act of the to confiscate the goods of Titus, or to attaint him of high treason, does not enter into the idea of a municipal law : for the operation of this act is spent upon Titus only and has no relation to the community in general : it is rather a sentence than a law. ", "\"This passage was cited with approval by in v. to show that the end product of the exercise of judicial power is a judgment or sentence and not a law. ", "285. (after considering the views of , and the opinions of jurists in pandects) has said that since the end of law is common good the law should be framed not for private benefit but for the common good of all citizens. ", "286. wrote :\" ", "When I say that the object of laws is always general, I mean that the law considers subjects collectively and actions as abstract; never a man as an individual, nor an action as particular.... neither is what the sovereign himself orders about a particular object a law but a decree; not an act of sovereignty, but of magistracy. ", "\"287. draws an explicit distinction between 'laws' and 'particular commands.' Where a command, he says, obliges generally to acts or forbearances of a class, a command is a law or rule. But where it obliges to a specific act or forbearance, a command is occasional or particular. ", "288. , after noting the distinction made by has observed :\" ", "We can of course recognize as law only general norms. But there is not doubt that law does not consist of general norms only. Law includes individual norms, i.e., norms which determine the behaviour of one individual in one non-recurring situation and which therefore are valid only for one particular case and may be obeyed or applied only once. ", "\"According to him, such norms are valid law because they are parts of the legal order as a whole in exactly the same sense as those general norms on the basis of which they have been created. He said that particular norms are the decisions of courts as far as their binding force is limited to the particular case at hand and that a judge who orders a debtor A to return $ 1000 to his creditor B was passing a law. ", "289. It may be noted that made no distinction between law-creation and law-application. According to him, every act of applying the law involved the creation of norms. In his view, there was not distinction between creation and application of law, a view I find difficult to accept in the light of clear distinction made by the decisions of this between legislative and judicial functions. ", "290. A statute is a general rule. A resolution by the that a town shall pay one hundred dollars to is not a statute. ", "291. The mere fact that an Act to indemnify A or and Act sanctioning a pension to the Speaker is passed by in England should not lead us to conclude that it is law.\" ", " was originally constituted, not for legislative, but for financial purposes. Its primary function was, not to make laws, but to grant supplies. ", "\"292. has said that statute books contains vast masses of matter which though in the form of laws, are not laws in the proper sense, that these consist in the making of provisions for the maintenance of public works of the , for the building of asylums, hospitals, school buses, and a great variety of similar matters, and that this is but the record of actions of the in relation to the business in which it is engaged. According to him, the is a great public corporation which conducts a vast mass of business, and the written provisions for this, though in the form of laws, are not essentially different from the minutes of ordinary corporate bodies recording their actions. ", "293. has said :\" ", "An immense mass, indeed of the legislation is not, in the proper language of jurisprudence, legislation at all. A law is a general command applicable to many cases. The 'special acts' which crowd the statute book and weary parliamentary committees are applicable to one case only. They do not lay down rules according to which railways shall be made, but enact that such and such a railway shall be made from this place to that place, and they have not bearing on any other transaction.\" ", "\" When the authors of books on jurisprudence write about law, when professional lawyers talk about law, the kind of law about which they are mainly thinking is that which is found in Justinian's Institutes, or in the Napoleonic Codes, or in the New Civil Code of the German Empire, that is to say, the legal rule which relate to contracts and torts, to property, to family relations and inheritance, or else to law of crimes as is to be found in a Penal Code . ", "\"294. was of the view that 'legislative authority is to act in a particular way..... (and) those who wield this authority should make only general rules. They are to govern by promulgated established laws not to be varied in particular cases'. ", "295. Perhaps the most exhaustive treatment of the question of the necessity for generality in law is to be found in \"Jurisprudence, Men and Ideas of the Law\" by (see Chapter V). According to him, the generality of a law depends upon its being applicable to an indefinite number of human beings and that is the most significant aspect of law. He said that an ordinary judgment of a court is not law as a judgment applies only to a limited number of individuals, the parties to the case. He disagreed with Dr. 's statement that the judicial decision is an individual legal norm as the expression 'individual legal norm' is a self-contradiction. ", "296. To , the most essential element in the concept of law is a degree of generality :\" ", "The first desideratum of a system for subjecting human conduct to the governance of rules is an obvious one : there must be rules. This may be stated as a requirement of generality. Here as in so many other fields, distinction was basically right, but too rigidly drawn. ", "\" was of the view that a community which had no general prescription at all, but only an infinite multitude of individual commands, would not be regarded as having a legal order. It would dissolve into millions of individual relationships. ", "297. For the purpose of this case I accept as correct the statement of already quoted and approved by in v. (supra). I cannot regard the resolution of an election dispute by the amending body as law : It is either a judicial sentence or a legislative judgment like a Bill of Attainder. ", "298. It is no doubt true that in England used to pass bills of attainder. But the practice has fallen into desuetude, since the year 1696. A bill of attainder is a special act of the , as inflict capital punishments upon persons supposed to be guilty of high offences, such as treason and felony, without any conviction in the ordinary course of judicial proceedings. The assumes judicial magistracy, pronouncing upon the guilt of the party without any of the common forms and guards of trial, and satisfying itself with proofs, when such proofs are within its reach, whether they are conformable to the rules of evidence or not. In short, in all such cases, the exercises the highest power of sovereignty, and what may be properly deemed an irresponsible despotic discretion, being governed solely by what it deems political necessity or expediency, and too often under the influence of unreasonable fears, or unfounded suspicions. ", "299. In U. S. v. Brown of United States of America stated that the main reason why the power to pass bill of attainder was taken away from the was :\" ", "Everyone must concede that a legislative body, from its numbers and organisation, and from the very intimate dependence of its members upon the people, which renders them liable to be peculiarly susceptible to popular clamour, is not properly constituted to try with coolness, caution, and impartiality a criminal charge, especially in those cases in which the popular feeling is strongly excited - the very class of cases most likely to be prosecuted by this mode. ", "\"Much the same reason will apply to the resolution of an election dispute by an amending body as it consists, in all democratic countries, of an assembly of persons like . ", "300. In v. (supra) the appellants had been charged with offences arising out of an abortive coup d'etat on January 27, 1962. The story of the coup d'etat was set out in a White Paper issued by the Ceylon Government. On March 16, 1962 the Criminal Law (Special Provisions) Act was passed and it was given retrospective effect from January 1, 1962. The Act was limited in operation to those who were accused of offences against the State in or about January 27, 1962. The Act legalised the imprisonment of the appellants while they were awaiting trial, and modified a section of the Penal Code so as to enact ex post facto a new offence to meet the circumstances of the abortive coup. The Act empowered the Minister of Justice to nominate the three judges to try the appellants without a jury. The validity of the Act was challenged as well as the nomination which had been made by the Minister of Justice of the three judges. upheld the objection about the vires of some of the provis ", "301. said in the course of their judgment that the pith and substance of the law enactments was a legislative plan ex post facto to secure the conviction, that although legislation ad hominem which is directed to the course of particular proceedings may not always amount to an interference with the functions of the , but in the present case they had no doubt that there was such interference; that it was not only the likely but the intended effect of the impugned enactments and that it was fatal to their validity. They further said that the true nature and purpose of these enactments were revealed by their conjoint impact on the specific proceedings in respect of which they were designed, and they took their colour, in particular from the alterations they purported to make as to their ultimate objective - the punishment of those convicted - and that these alterations constituted a grave and deliberate incursion into the judicial sphere and then, they quoted with approval the observation ", "302. At the time when the amendment was passed, the appeal filed by the appellant and the cross appeal of the respondent were pending before . Clause (4) was legislation ad hominem directed against the course of the hearing of the appeals on merits as the appeal and the cross appeal were to be disposed of in accordance with that clause and not by applying the law to the facts as ascertained by the court. This was a direct interference with the decision of these appeals by on their merits by a legislative judgment. ", "303. If the amending body really exercised judicial power, that power was exercised in violation of the principles of natural justice of . Even if a power is given to a body without specifying that the rules of natural justice should be observed in exercising it, the nature of the power would call for its observance. ", "304. The Solicitor General contended that the amending body, in declaring that the election was valid, was exercising its constituent legislative power; that legislative power does not adjudicate but only creates validity, even retrospectively, by enacting a law with that effect; that validation is law-making; that it alters the legal position by making new law and that validation may take place before or after a judgment. He said that by the repeal of the provisions of the Representation of the People Act , 1951, the amending body had wiped out not only the election petition but also the judgment of and had deprived the respondent of the right to raise any dispute as regards the validity of the election of the appellant and, therefore, there was no dispute to be adjudicated upon by the amending body. He also said - I think, in the alternative - that although the law relating to election petitions and other matters connected therewith was dispensed with in respect of the appellant, the amending ", "305. It is difficult to understand, when the amending body expressly excluded the operation of all laws relating to election petition and matters connected therewith by the first part of clause (4), what ideal norms of free and fair election it had in view in adjudging the validity of the election of the appellant. I cannot conceive of any pre-existing ideal norms of election apart from the law enacted by the appropriate . If the amending body evolved new norms for adjudging the validity of the particular election, it was the exercise of a despotic power and that would damage the democratic structure of the Constitution. ", "306. Quite apart from it, there is nothing on the face of the amendment to show that the amending body ascertained the facts of the case or applied any norms for determining the validity of the election. I do not think that under Article 368 the amending body was competent to pass an ordinary law with retrospective effect to validate the election. It can only amend the Constitution by passing a law of the rank of which the Constitution is made of. ", "307. There is also nothing to show that the amending body validated the election with reference to any change of the law which formed the foundation of the judgment. The cases cited by the Solicitor General to show that a competent has power to validate an invalid election do not indicate that there can be a validation without changing the law which invalidated the election. Nor do I think that a contested election can be validated without an authority applying the new law to the facts as ascertained by judicial process. If the court which ascertained the facts and applied the law was rendered coram non judice, the facts ascertained by it have ceased to be facts. There are no absolute or immediately evident facts. Only by being first ascertained through legal procedure are facts brought into the sphere of law or, we may say, though it may sound paradoxical, that the competent organ legally created facts. The courts perform a constitutive function in ascertaining facts. There is no fact 'in itself ", "308. If clause (4) was an exercise in legislative validation without changing the law which made the election invalid, when there ought to have been an exercise of judicial power of ascertaining the adjudicative facts and applying the law, the clause would damage the democratic structure of the Constitution, as the Constitution visualizes the resolution of an election dispute by a petition presented to an authority exercising judicial power. The contention that there was no election dispute as clause (4) by repealing the law relating to election petition had rendered the petition filed by the respondent non est, if allowed, will toll the death knell of the democratic structure of the Constitution. If Article 329(b) envisages the resolution of an election dispute by judicial process by a petition presented to an authority as the appropriate may by law provide, a constitutional amendment cannot dispense with that requirement without damaging an essential feature of democracy, viz., the mechanism fo ", "309. All the cases cited by the Solicitor General pertain either to legislative validation of a void election by applying a new law to undisputed facts or to the removal of an admitted disqualification by a law with retrospective effect. ", "310. In v. , the facts were : An order in council of 1923 made provision as to in Ceylon, but reserved to His Majesty power to revoke, alter or amend the order. The appellant, as common informer, brought an action to recover penalties under the Order from the respondent, who he alleged had sat and voted after his seat had become vacant under its provisions by reason of his having a pecuniary interest in a contract with the Government. In 1928, after the action had been brought but before its trial, an amending Order in Council was made which provided :\" ", "If any such action or legal proceeding has been or shall be instituted, it shall be dismissed and made void, subject to such order as to costs as the may think fit to make. ", "\"It also amended the Order of 1923 so as to except the officer held by the respondent from its operation. held that the Order of 1928 was valid, having regard to the power reserved by the Order of 1923, and was an effective defence to the action, although it was retrospective in its operation and that this was no exercise of judicial power. The direction to dismiss must be understood in the light of an earlier provision in the same Order in Council which amended the law on which the proceeding was founded; the dismissal was thus the result of the change in the law and all that the later clause showed was that the change was to have retrospective effect and govern the rights of parties even in pending proceedings. The decision would be helpful here only if an in so far as the provision in clause (4) had followed from a change in any rule of law. ", "311. The decision in v. King Emperor concerned the validation of a sentence imposed by a special criminal court which was held to have no jurisdiction to try the case by an order of a court. By a validation Act, the jurisdiction was conferred with retrospective effect on the special criminal court and the sentence imposed by it was made lawful. It was held that there was no exercise of any judicial power by the legislating authority. ", "312. , the appellant, a government advocate stood for election to of Rajasthan and was declared elected. The election was challenged and the ground of challenge was that the appellant held an office of profit within the meaning of Article 191 of the Constitution. set aside the election for that reason. While the appeal was pending in this Court, Rajasthan Act 5 of 1969 was passed declaring among others that the holder of the office being a member of ; and, by Section 2(2) , the Act was made retrospective removing the appellant's disqualification retrospectively. It was held that Act 5 of 1969 had removed the disqualification retrospectively, that and can legislate retrospectively subject to the provisions of the Constitution, that no limitation on the powers of the to make a declaration validating an election could be put, and that, by enacting the im ", "313. , the facts were as follows : Elections were held for the Cuttack municipality and 27 persons were declared elected as councillors. One B, who defeated at the elections, filed a writ petition before challenging the elections. held that the electoral rolls had not been prepared in accordance with the provisions of the Orissa Municipalities Act, 1950, as the age qualification had been published too late thereby curtailing the period of claims and objections to the preliminary roll to 2 days from 21 days as prescribed; consequently, set aside the elections. The State took the view that the judgment affected not merely the Cuttack municipality but other municipalities also. Accordingly, the Governor promulgated an Ordinance validating the elections to the Cuttack municipality and validating the electoral rolls prepared in respect of other municipalities. Thereupon, B filed a writ petition before contending ", "314. This Court held that Section 3(1) of the Ordinance effectively removed the defects in the electoral rolls found by by its judgment and that it successfully cured the invalidity of the electoral roll and of the elections to the Cuttack municipality. ", "315. The Solicitor General also cited other decisions to show that a can validate proceedings rendered invalid by judgment of court. As I said, they all involved substitution of new law with retrospective effect for the old one and the basic facts were all taken to have been admitted or not controverted. If the facts are not admitted, the cannot determine them except by employing judicial process. Besides, those cases being cases of legislative validation, need not pass the test of the theory of basic structure which, I think, will apply only to constitutional amendment. ", "316. Counsel for the appellant also brought to the notice of the certain election validation Acts passed by in England. These Act s removed with retrospective effect disqualifications of members of . In none of these cases was an election which was being contested validated by . Nor can these instances of legislative removal of disqualification furnish any assistance to this for the reason that in England there is no theory of basic structure operating as a fetter on the power of . ", "317. It was argued for the respondent that if the amending body exercised judicial power and held the election of the appellant valid, its act was unconstitutional also on the ground it damaged another basic structure of the Constitution, namely, the doctrine of separation of powers. ", "318. The major problem of human society is to combine that degree of liberty without which law is tyranny with that degree of law without which liberty becomes licence; and, the difficulty has been to discover the practical means of achieving this grand objective and to find the opportunity for applying these means in the ever-shifting tangle of human affairs. A large part of the effort of man over centuries has been expended in seeking a solution of this great problem. A region of law, in contrast to the tyranny of power, can be achieved only through separating appropriately the several powers of government. If the law-makers should also be the constant administrators and dispensers of law and justice, then, the people would be left without a remedy in case of injustice since no appeal can lie under fiat against such a supremacy. And, in this age-old search of political philosophers for the secret of sound government, combined with individual liberty, it was who first saw the light. He was the f ", "319. There can be no liberty where the legislative and executive powers are united in the same person or body of magistrates, or, if the power of judging be not separated from the legislative and executive powers. said : ", "All powers of government - legislative, executive and judicial - result in the legislative body. The concentration of these powers in the same hands is precisely the definition of despotic government. It will be no alleviation that these powers will be exercised by a plurality of hands and not by a single person. One hundred and seventy-three despots would surely be as oppressive as one. ", "And, 's own words would show that where the whole power of one department is exercised by the same hands which possess the whole power of another department, the fundamental principles of a free Constitution are subverted. In Federalist No. 47, suggests that 's doctrine did not mean that separate departments might have \"not partial agency in or no control over the acts of each other.\" His meaning was, according to , no more than that one department should not possess the whole power of another. ", "320. The , said the , is beyond comparison the weakest of the three departments of power. It has no influence over either the sword or the purse; no direction either of the strength or of the wealth of the society and can take no active resolution whatever. It may truly be said to have neither force nor will, but merely judgment. Of the three powers said, the is in some measure next to nothing. If he realised the relative weakness of the at the time he wrote, it is evidence of his vision that he appreciated the supreme importance of its independence. There is no liberty, he said, if the judicial power to be separated from the legislative and executive. ", "321. But this doctrine which is directed against the concentration of these powers in the same hand has no application as such when the question is whether an amending body can exercise judicial power. In other words, the doctrine is directed against the concentration of these sovereign powers in one or other organ of Government. It was not designed to limit the power of a constituent body. ", "322. Whereas in the United States of America and in Australia, the judicial power is vested exclusively in courts, there is no such exclusive resting of judicial power in and the courts subordinate to it. And if the amending body exercised judicial power in adjudging the validity of the election, it cannot be said that by that act, it has damaged a basic structure of the Constitution embodied in the doctrine of separation of powers. Even so, the question will remain whether it could exercise judicial power without passing a law enabling it to do so. As I said, the exercise of judicial power can result only in a judgment or sentence. The constituent power, no doubt, is all-embracing, comprising within its ambit the judicial, executive and legislative powers. But if the constituent power is a power to frame or amend a Constitution, it can be exercised only by making laws of a particular kind. ", "323. The possession of power is distinct from its exercise. The possession of legislative power by the amending body would not entitle it to pass an ordinary law, unless the Constitution is first amended by passing a constitutional law authorizing it to do so. In the same way, the possession of judicial power by the amending body would not warrant the exercise of the it to do so. Until that is done, its potential judicial power would not become actual. Nobody can deny that by passing a law within its competence, can vest judicial power in any authority for deciding a dispute or vest a part of that power in itself for resolving a controversy, as there is no exclusive vesting of judicial power in courts by the Constitution. The doctrine of separation of powers which is directed against the concentration of the whole or substantial part of the judicial power in the or the would not be a bar to the vesting of such a power in itself. But, until a law is passed enabling it to do so ", "324. Lord objected to the exercise of judicial power by for pragmatic reasons. Much of what Lord said can be applied to when it seeks to exercise that power in its constituent capacity. ", "325. A sovereign in any system of civilized jurisprudence is not like an oriental despot who can do anything he likes, in any manner he likes and at any time he likes. That the of Hyderabad had legislative, judicial and executive powers and could exercise any one of them by a firman has no relevance when we are considering how a pro-sovereign - the holder of the amending power - in a country governed by a Constitution should function. Such a sovereign can express 'himself' only by passing a particular kind of law; and not through sporadic acts.'He' cannot pick and choose cases according to his whim and dispose them of by administering 'cadi-justice'; nor can the amending body, as already noticed, pass an ordinary law, as Article 368 speaks of the constituent power of amending by way of addition, variation or repeal, any provision of the Constitution in accordance with the procedure laid down in that article. An ordinary law can be passed by it only after amending the provisions of the Constitution auth ", "326. If the basic postulate that a sovereign can act only by enacting laws is correct, then that is a limitation upon his power to do anything he likes. If I may rephrase the classical statement of Sir : The law that a sovereign can act only by law is supreme but as to what may be done by a law so made, the sovereign is supreme over that law. Of course, this is subject to the theory of basic structure. In other words, even though a sovereign can act only by making law, the law he so makes may vest the authority to exercise judicial power in himself; without such law he cannot exercise judicial power. ", "327. The result of the discussion can be summed up as follows : Our constitution, by Article 329(b) visualizes the resolution of an election dispute on the basis of a petition presented to such authority and in such manner as the appropriate may, by law, provide. The nature of the dispute raised in an election petition is such that it cannot be resolved except by judicial process, namely, by ascertaining the facts relating to the election and applying the pre-existing law; when the amending body held that the election of the appellant was valid, it could not have done so except by ascertaining the facts by judicial process and by applying the law. The result of this process would not be the enactment of constitutional law but the passing of a judgment or sentence. The amending body, though possessed of judicial power, had not competence to exercise it, unless it passed a constitutional law enabling it to do so. If, however, the decision of the amending body to hold the election of the appellant v ", "328. Then I come to the argument of Counsel that equality is a basic structure of the Constitution and that that has been damaged or destroyed by clause (4). ", "329. The Solicitor General submitted that the majority in 's case (supra) did not hold that Article 14 pertains to the basic structure, that apart from Article 14 , there is no principle of equality which is a basic structure of the Constitution and that it is not a chameleon-like concept which changes its colour with the nature of the subject-matter to which it is applied. ", "330. The majority in 's case (supra) did not hold that Article 14 pertains to the basic structure of the Constitution. The majority upheld the validity of the first part of Article 31-C; this would show that a constitutional amendment which takes away or abridges the right to challenge the validity of an ordinary law for violating the fundamental right under that article would not destroy or damage the basic structure. The only logical basis for supporting the validity of Articles 31-A, 31-B and the first part of 31-C is that Article 14 is not a basic structure. ", "331. Counsel for the respondent, however, submitted that even if Article 14 does not pertain to basic structure, equality is an essential feature of democracy and rule of law and that clause (4), by dispensing with the application of the law relating to election petition and matters connected therewith to the appellant and another has made an unreasonable distinction between persons similarly situated and has thereby damaged or destroyed that essential feature, and therefore, the clause is bad. He said that in so far as laws are general instructions to act or refrain from acting in certain ways in specified circumstances enjoined upon persons of a specified kind, they enjoin uniform behaviour in identical cases; that to fall under a law is pro tanto to be assimilated to a single pattern; and that a plea for rule of law in this sense is, in essence, a plea for life in accordance with laws as opposed to other standards, namely, the ad hoc dispensation from its operation. He argued that if some persons, for no ", "332. Democracy proceeds on two basic assumptions : (1) popular sovereignty in the sense that the country should be governed by the representatives of the people; that all power came from them; at their pleasure and under their watchful supervision it must be held; and (2) that there should be equality among the citizens in arriving at the decisions affecting them. ", "333. Today, it is impossible to conceive of a democratic republican form of government without equality of citizens. It is true that in the republics of Athens and Rome there were slaves who were regarded as chattels. And, even in the United States of America, there was a republic even before the Negroes were enfranchised. Our Constitution envisages the establishment of a democratic republican form of government based on adult suffrage. ", "334. Equality is a multi-coloured concept incapable of a single definition. It is a notion of many shades and connotations. The preamble of the Constitution guarantees equality of status and of opportunity. They are nebulous concepts. And I am not sure whether they can provide a solid foundation to rear a basic structure. I think the types of equality which our democratic republic guarantees are all subsumed under specific articles of the Constitution like Articles 14, 15, 16, 17, 25 etc., and there is no other principle of equality which is an essential feature of our democratic polity. ", "335. In the opinion of some of the judges constitution the majority in 's case (supra), rule of law is a basic structure of the Constitution apart from democracy. ", "336. The rule of law postulates the pervasiveness of the spirit of law throughout the whole range of government in the sense of excluding arbitrary official action in any sphere.'Rule of law' is an expression to giver reality to something which is not readily expressible. That is why Sir said that it is an unruly horse. Rule of law is based upon the liberty of the individual and has as its object, the harmonizing of the opposing notions of individual liberty and public order. The notion of justice maintains the balance between the two; and justice has a variable content. 's formulation of the rule of law, namely,\" ", "the absolute supremacy or predominance of regular law, as opposed to the influence of arbitrary power, excluding the existence of arbitrariness, of prerogative, even of wide discretionary authority on the part of the government \"has been discarded in the later editions of his book. That is because it was realized that it is not necessary that where law ends, tyranny should begin. As said, where the law ends, discretion begins and the exercise of discretion may mean either beneficence or tyranny, either justice or injustice, either reasonableness or arbitrariness. There has been no government or legal system in world history which did not involve both rules and discretion. It is impossible to find a government of laws alone and not of men in the sense of eliminating all discretionary powers. All governments are governments of laws and of men. has said :\" ", "This much we can surely say : For , from whom derived the notion of a government of laws and not of men, that notion was not expressive of hostility to what today we call administrative discretion. Nor did it have such a meaning for \". ", "733. Another definition of rule of law has been given by in his books : \"Road of Serfdom\" and \"Constitution of Liberty\". It is much the same as that propounded by in England :\" ", "The rule of law stands for the view that decisions should be made by the application of known principles or laws. In general such decisions will be predictable, and the citizen will know where he is. On the other hand there is what is arbitrary. A decision may be made without principle, without any rules. It is therefore unpredictable, the antithesis of a decision taken in accordance with the rule of law \". ", "338. This Court said in that the rule of law from one point of view means that decisions should be made by the application of known principles and rules, and, in general, such decisions should be predictable and the citizen should know where he is. ", "339. This exposition of the rule of law is only the aspiration for an ideal and it is not based on any down-to-earth analysis of practical problems with which a modern Government is confronted. In the world of action, this ideal cannot be worked out and that is the reason why this exposition has been rejected by all practical men. ", "340. If it is contrary to the rule of law that discretionary authority should be given to government departments or public officers, then there is no rule of law in any modern State. A judge who passes a sentence has no other guidance except a statute which says that the person may be sentenced to imprisonment for a term which may extend to, say, a period of ten years. He must exercise considerable discretion. and the court overrule their precedents. What previously announced rules guide them in laying down the new precedents ? A court of law decides a case of first impression; no statute governs, no precedent is applicable. It is precisely because a judge cannot find a previously announced rule that he becomes a legislator to a limited extent. All these would show that it is impossible to enunciate the rule of law which has as its basis that no decision can be made unless there is a certain rule to govern the decision. ", "341. Leaving aside these extravagant versions of rule of law, there is a genuine concept of rule of law and that concept implies equality before the law or equal subjection of all classes to the ordinary law. But, if rule of law is to be a basic structure of the Constitution, one must find specific provisions in the Constitution embodying the constituent elements of the concept. I cannot conceive of rule of law as a twinkling star up above the Constitution. To be a basic structure, it must be a terrestrial concept having its habitat within the four corners of the constitution. The provisions of the Constitution were enacted with a view to ensure the rule of law. Even if I assume that rule of law is a basic structure, it seems to me that the meaning and the constituent elements of the concept must be gathered from the enacting provisions of the Constitution. The equality aspect of the rule of law and of democratic republicanism is provided in Article 14. May be, the other articles referred to do the same duty ", "342. , said that Article 14 combines the English doctrine of the rule of law and the equal protection clause of the Fourteenth Amendment to the American Federal Constitution. In v. , , observed that the first part of the article which has been adopted from the Irish Constitution, is a declaration of equality of the civil rights of all persons within the territories of India and thus enshrines what American judges regard as the \"basic principle of republicanism\" and that the second part which is a corollary of the first is based on the last clause of the first section of the Fourteenth Amendment of the American Constitution. So, the concept of equality which is basic to rule of law and that which is regarded as the most fundamental postulate of republicanism are both embodied in Article 14. If, according to the majority in 's case (supra), Article 14 does not pertain to basic structure of the Constitution, which is the other principle of equa ", "343. I think clause (4) is bad for the reasons which I have already summarized. Clause (1) to (3) of Article 329-A are severable but I express no opinion on their validity as it is not necessary for deciding this case. ", "344. Then the question is, whether the Representation of the People (Amendment) Act , 1974, and the Election Laws (Amendment) Act , 1975, are liable to be challenged for the reason that they damage or destroy a basic structure of the Constitution. Counsel for the respondent submitted that, if, by a constitutional amendment, the basic structure of the Constitution cannot be destroyed or damaged, it would be illogical to assume that an ordinary law passed under a power conferred by that instrument can do so and since these Acts damage the concept of free and fair election, the Acts were bad. ", "345. I think the inhibition to destroy or damage the basic structure by an amendment of the Constitution flows from the limitation on the power of amendment under Article 368 read into it by the majority in 's case (supra) because of their assumption that there are certain fundamental features in the Constitution which its makers intended to remain there in perpetuity. But I do not find any such inhibition so far as the power of or to pass laws is concerned. Article 245 and 246 give the power and also provide the limitation upon the power of these organs to pass laws. It is only the specific provisions enacted in the Constitution which could operate as limitation upon that power. The preamble, though a part of the Constitution, is neither a source of power nor a limitation upon that power. The preamble sets out the ideological aspirations of the people. The essential features of the great concepts set out in the preamble are delineated in the various provisions of the Con ", "346. I do not think that an ordinary law can be declared invalid for the reason that it goes against the vague concepts of democracy; justice, political, economic an social; liberty of thought, belief and expression; or equality of status and opportunity, or some invisible radiation from them.\" ", ".... (N) o political terms have been so subjected to contradictory definitions as 'democracy' and 'democratic' since it has become fashionable and profitable for every and any State to style itself in this way. The Soviet Union and communist States of Eastern Europe, the Chinese People's Republic, North Korea and North Vietnam all call themselves democracies. So does 's Egypt; so does General 's Paraguay; so did 's Indonesia. Yet, if anything is clear, it is that these States do not all meet the same definition of democracy \". ", "Definitions are important, for, they are responsible in the last analysis for our image of democracy. The question is not only what does the word 'democracy' mean but also what is the thing. And, when we try to answer this latter query, we discover that the thing does not correspond to the word. So, although 'democracy' has a precise literal meaning, that does not really help us to understand what an actual democracy is. In the real world, has pointed out that, democracies are 'polyarchies'. The term democracy has not only a descriptive or denotative function but also a normative and persuasive function. Therefore, the problem of defining democracy is twofold, requiring both a descriptive and prescriptive function. To avoid pitfalls, it is necessary to keep in mind two things - first, that a firm distinction should be made between the is and the ought of democracy, and, second, that the prescriptive and the descriptive definitions of democracy must not be confused, because the democratic ideal doe ", "347. Nor can it be tested on the touchstone of justice. The modern asks : What is justice? and stays not for an answer. To , justice is an irrational ideal, and regarded from the point of rational cognition, he thinks there are only interests and hence conflict of interest. Their solution, according to him, can be brought about by an order that satisfies one interest at the expense of the other or seeks to achieve a compromise between opposing interests. Mr. has said that the concept of social justice is vague and indefinite. Liberty of thought, expression, belief, faith and worship are not absolute concepts. They are emotive words. They mean different things to different people. Equality of status and of opportunity are concepts laden with emotional overtones. In their absoluteness they are incapable of actual realisation. The enacting provisions in the body of the Constitution alone give concrete shape to these ideas and it is on the basis of these provisions that the validity of or ", "348. The democracy which our Constitution-makers established is based on the representation of the people in the law-making organs. The method by which this representation has to be effectuated has been provided in the Constitution. Part XV of the Constitution deals with the topic of elections. Article 326 provides that elections to and to the legislative assemblies of States should be on the basis of adult suffrage. Articles 327 and 328 provide for making of laws with respect to all matters relating to, or in connection with, elections to either or to the or either of the Legislature of a State including the preparation of electoral rolls, the delimitation of constituencies and all other matters necessary for securing the due constitution of such or s. The validity of any law relating to the delimitation of constituencies or the allotment of seats to the constituencies, made or purporting to be made under Article 327 or Article 328 shall not ", "349. This would indicate that the constitution has entrusted the task of framing the law relating to election to , and, subject to the law made by , to , An important branch of the law which sounds in the area of free and fair election, namely, delimitation of constituencies and allotment of seats to such constituencies is put beyond the cognizance of court. When it is found that the task of writing the legislation on the subject has been committed to and by the Constitution, is it competent for a court to test its validity on the basis of some vague norms of free and fair election? I think not. As I said, like other laws made by or , the laws made under Articles 327 and 328 are liable to be tested by Part III of the Constitution or any other provision of the Constitution; but it is difficult to see how these laws could be challenged on the ground that they do not conform to some ideal notions of free and fai ", "350. The doctrine of the 'spirit' of the Constitution is a slippery slope. The courts are not at liberty to declare an Act void, because, in their opinion, it is opposed to the spirit of democracy or republicanism supposed to pervade the Constitution but not expressed in words. When the fundamental law has not limited, either in terms or by necessary implication, the general powers conferred upon the , we cannot declare a limitation under the notion of having discovered some ideal norm : of free and fair election. ", "351. has observed that courts are not at liberty to declare statutes void because they appear to the minds of the judges to violate fundamental principles of republican government, unless it shall be found that those principles are placed beyond legislative encroachment by the Constitution. The principles of democratic republican government are not a set of inflexible rules; and unless they are specifically incorporated in the Constitution, no law can be declared bad merely because the thinks that it is opposed to some implication drawn from the concept. ", "352. Counsel for the respondent relied upon the observations of , at p. 216 SCC(p) 405, para 475), and , . at p. 292 SCC(p) 463, para 608). and , . at p. 335 SCC(p) 511, para 742) and , J. at p. 556 SCC(p) 667, para 1212) in their judgments in 's case (supra) in support of his contention that when these Acts were put in the Ninth Schedule by the constitutional amendment, their provisions became vulnerable to attack if they or any one of them damaged or destroyed the basic features of democracy or republicanism. ", "353. , C.J. has said that the constitution Twenty-ninth Amendment Act, 1971, is ineffective to protect the impugned Acts there if they abrogate or take away fundamental rights. This would not show that the learned Chief Justice countenanced any challenge to an Act on the ground that the basic structure of the Constitution has been damaged or destroyed by its provisions not constituted by the fundamental rights abrogated or taken away. In other words, if by taking away or abridging the fundamental rights, the basic structure of the Constitution is damaged or destroyed, then, according to the learned Chief Justice, the legislation would be vulnerable on that score, even though it is put in the Ninth Schedule by a constitutional amendment. But it would not follow that an Act so put can be challenged for a reason not resulting from the taking away or abrogation of the fundamental right. To put it differently, even though an Act is put in the Ninth Schedule by a constitutional amendment, its provisions would ", "354. and , . have said in their judgment that the Twenty- ninth Amendment is valid, but the question whether the Acts included in the Ninth Schedule by that amendment or any provision of those Acts abrogates any of the basic elements of the constitutional structure or denudes them of their identity will have to be examined when the validity of those Acts comes up for consideration. Similar observations have been made by and , . and by , J. only said that the Twenty-ninth Amendment was valid. ", "355. It is rather strange that an Act which is put in the Ninth Schedule with a view to obtain immunity from attack on the ground that the provisions thereof violate the fundamental rights should suddenly become vulnerable on the score that they damage or destroy a basic structure of the Constitution resulting not from the taking away or abridgment of the fundamental rights but for some other reason. ", "356. There is no support from the majority in 's case (supra) for the proposition advanced by Counsel that an ordinary law, if it damages or destroys basic structure should be held bad or for the proposition that a constitutional amendment putting an Act in the Ninth Schedule would make the provisions of the Act vulnerable for the reason that they damage or destroy a basic structure constituted not by the fundamental rights taken away or abridged but some other basic structure. And, in principle, I see no reason for accepting the correctness of the proposition. ", "357. The Constitution-makers eschewed to incorporate the 'due process' clause in that instrument apprehending that the vague contours of that concept will make the court a third chamber. The concept of a basic structure as brooding omnipresence in the sky apart from the specific provisions of the Constitution constituting it is too vague and indefinite to provide a yardstick to determine the validity of an ordinary law. ", "358. So if it be assumed that these election laws amendment Acts, even after they were put in the Ninth Schedule by constitutional amendment remained open to attack for contravention, if any, of the fundamental rights, these Acts would not be open to attack on the ground that their provisions destroyed or damaged an essential feature of democracy, namely, free and fair election. The Act s remain part of the ordinary law of the land. They did not attain the status of constitutional law merely because they were put in the Ninth Schedule. The utmost that can be said is, as I indicated, that even after putting them in the Ninth Schedule, their provisions would be open to challenge on the ground that they took away or abrogated all or any of the fundamental rights and therefore damaged or destroyed a basic structure if the fundamental rights or right taken away or abrogated constitute or constitutes a basic structure. ", "359. Counsel for the respondent then contended that retrospective operation has been given to the provisions of these Acts and that that would destroy or damage an essential feature of democracy viz, free and fair elections. The argument was that if one set of laws existed when an election was held and the result announced, you cannot thereafter substitute another set of laws and say that those laws must be deemed to have been in operation at the time when the election was held and the result announced, as that would lead to inequality, injustice and unfairness. ", "360. Retrospective operation of law in the field of election has been upheld by this Court [see (supra)]. Retrospective operation of any law would cause hardship to some persons or other. This is inevitable; but that is no reason to deny to the the power to enact retrospective law. In the case of a law which has retrospective effect, the theory is that the law was actually in operation in the past and if the provisions of the Acts are general in their operation, there can be no challenge to them on the ground of discrimination or unfairness merely because of their retrospective effect. In other words, if an Act cannot be challenged on the ground that its provisions are discriminatory or unreasonable if it is prospective in operation, those provisions cannot be attacked on these grounds merely because the provisions were given retrospective effect, unless there are special circumstances. I see no such special circumstances here. ", "361. I therefore hold that these Acts are not liable to be challenged on any of the grounds argued by Counsel. ", "362. Counsel for the respondent submitted that the session of in which the Election Laws Amendment Act , 1975 and the Thirty-ninth amendment to the Constitution were passed was not properly convened and therefore the amendments were invalid. ", "363. The argument was that a number of members of the two Houses of were illegally detained by executive orders before the summoning of the two Houses and that was made possible by the President - the authority to summon the two Houses - making an order under Article 359 of the Constitution on June 27, 1975, which precluded these members from moving the court and obtaining release from illegal detention and attending the session. In effect, the contention of Counsel was that the authority to summon effectually prevented by its order made under Article 359 , those members who were illegally detained from attending the session and, as the composition of the session was unconstitutional, any measure passed in the session would be bad. Reliance was placed by Counsel upon the decision in in support of this proposition. ", "364. The question which fell for consideration in that case was whether, when a member of was convicted for a criminal offence and was undergoing a sentence in pursuance thereof, he has an unconditional right to attend a Session of . This Court held that he had no privilege which obliged the court to release him from custody in order to enable him to attend the session. This decision has no relevance to the point in controversy here. ", "365. In England, a member of who is convicted of a criminal offence and is undergoing sentence in pursuance to his conviction has no right or privilege to be released from custody for attending parliament. The very same principle will apply in the case of a detention under an emergency regulation. ", "366. In England, it was taken as settled that parliamentary roll is conclusive of the question that a bill has been passed by both Houses of and has received royal assent and no court can look behind the roll as such an inquiry would be an interference with the privilege of . Lord said in v. :\" ", "I think it right to say a work or two upon the point that has been raised with regard to an Act of being held inoperative by a court of justice because the forms prescribed by the two Houses to be observed in the passing of a Bill have not been exactly followed...... I cannot but express my surprise that such a notion should have prevailed. There is no foundation for it. All that a court of justice can do is to look to the ary Roll. If from that it should appear that a Bill has passed both Houses and received the Royal Assent, no court of justice can inquire into the mode in which it was introduced in , nor into what was done previous to its introduction, or what passed in during its progress in its various stages through both Houses \". ", "367. It has since been said that parliamentary roll is not conclusive, that when the jurisdiction of a court is invoked, it has power to determine whether everything necessary has been done for the production of a valid statute, that rule of law requires that the court should determine legal questions raised before it and if its jurisdiction is properly invoked, it has to answer the question whether the document is a statute duly enacted by a . The view as propounded has been summarized as follows :\" ", "(1) Sovereignty is a legal concept : the rules which identify the sovereign and prescribe its composition and functions are logically prior to it. ", "(2) there is a distinction between rules which govern, on the one hand, (a) the composition, and (b) the procedure, and on the other hand (c) the area of power, of a Sovereign . ", "(3) the courts have jurisdiction to question the validity of an alleged Act of Parliament on grounds 2(a) and 2(b), but not on ground 2(c) \".The reasons for the view are these : when the purported sovereign is anyone but a single actual person, the designation of him must include the statement of rules for the ascertainment of his will, and these rules, since their observance is a condition of the validity of his legislation, are rules of law logically prior to him. The extraction of a precise expression of will from a multiplicity of human beings is, despite all the realists say, an artificial process and one which cannot be accomplished without arbitrary rules. It is therefore an incomplete statement to say that in a State such and such an assembly of human beings is sovereign. It can only be sovereign when acting in a certain way prescribed by law. At least some rudimentary manner and form is demanded of it : the simultaneous incoherent cry of a rabble, small or large, cannot be law, for it is unintelligible. ", "368. Sir has said that supreme legal power is in one sense limited by the rules which prescribe how it shall be exercised. Even if no constitutional rule places a limit or boundary to what can be done by sovereign legal authority, the organs which are to exercise it must be delimited and defined by rules. ", "369. So, the questions to be asked are : how is composed ? How does express its will ? ", "370. The rules which identify the sovereign are as important as the institution so identified. If this is so, it is open to the court to see whether a has been properly summoned in order to decide the question whether a measure passed by it answers the description of a statute or an Act and that parliamentary roll, if such a thing exists, is not conclusive. ", "371. As to parliamentary roll, has said :\" ", "The 'Parliamentary Roll', whatever exactly it may have been, disappeared in England a century ago, though even good authors sometimes write as if it still exists. Since 1849 there has been no 'Roll', simply two prints of the Bill on durable vellum by Her Majesty's , which are signed by the Clerk of the Parliaments and regarded as the final official copies. One is preserved in and one in the library of \". ", "372. Article 122(1) provides that the validity of any proceedings in shall not be called in question on the ground of any alleged irregularity of procedure. So, even if there is any irregularity in the procedure in the passing of the statute, it is not open to a court to question its validity. But this is distinct from the question whether the two Houses have been properly summoned and the composition of the Session was proper. ", "373. The Solicitor General said that if a member is excluded from participating in the proceedings of a , that is a matter concerning the privilege of that as the grievance is one of exclusion from the proceedings within the walls of the . And, in regard to the right to be exercised within the walls of the , the itself is the judge. He referred to 's Parliamentary Practice (18th Ed., pp. 82-83) and also to v. in this connection. He further said that if an outside agency illegally prevents a member from participating in the proceedings of the , the , the has power to secure his presence in the and cited 's Parliamentary Practice (18th Ed., pp. 92-95) to support the proposition. ", "374. These passages throw no light on the question in issue here. Ever since the decision of , in v. it has been settled that privilege is part of the common law and cannot affect rights to be exercised outside or independently of the . Regularity of internal proceedings is one thing; the constitutional rights of the subject are another; and it is the latter which are in issue in a case where the question is whether the document is a statute. ", "375. Article 85(1) provides that the President shall from time to time summon to meet at such time and place as he thinks fit, but six months shall not intervene between its last sitting in one session and the date appointed for its first sitting in the next session. ", "376. The detention of these members of was by statutory authorities in the purported exercise of their statutory power. It would be strange if a statutory authority, by an order which turns out to be illegal, could prevent the s of from meeting as enjoined by Article 85. If a statutory authority passes an illegal order of detention and thus prevents a member of from attending the , how can the proceedings of become illegal for that reason ? It is the privilege of to secure the attendance of persons illegally detained. But what would happen if the privilege is not exercised by ? I do not think that the proceedings of would become illegal for that reason. ", "377. The suspension of the remedy for the enforcement of fundamental rights by the order of the President under Article 359 is dependent upon a valid proclamation of emergency under Article 352. If a situation arose which authorized the President to issue a proclamation under Article 352 , he could also suspend, under Article 359 , the remedy to move the court to enforce the fundamental rights. These are the constitutional functions of the President and unless it is established that the proclamation made by the President under Article 352 or the suspension under Article 359 of the remedy for enforcement of fundamental rights is unconstitutional, it is impossible to hold that the President has, in any way, illegally prevented the release of these members from the supposed illegal detention so as to make a session of unconstitutional in consequence of the inability of those members to attend the session. In other words, the President, in performing his constitutional function under these articles has ", "378. Counsel for the respondent submitted that it is immaterial when a candidate committed a corrupt practice - whether it was before or after he became a candidate - and that an election would be set aside even if a person committed the corrupt practice before he became a candidate. Section 79(b) of the Representation of the People Act, 1951, defined the word 'candidate' as follows :\" ", "'candidate' means a person who has been or claims to have been duly nominated as a candidate at any election, and any such person shall be deemed to have been a candidate as from the time when, with the election in prospect, he began to hold himself out as a prospective candidate \". ", "Clause 7 of the Election Laws (Amendment) Act , 1975, substituted the present definition in Section 79(b) which reads :\" ", "'candidate' means a person who has been or claims to have been duly nominated as a candidate at an election \". ", "379. In support of the proposition that an election can be set aside even if a person has committed corrupt practice of bribery before he became a candidate, Counsel Cited Halsbury's Laws of England, 3rd Ed., Volume 14, pages 222 (paragraph 386) and 218 (paragraph 380). ", "380. These paragraphs state that in order to constitute the offence of bribery, it does not matter how long before an election a bribe is given, provided that the bribe is operative at the time of the election, and that, time is material only when considering the question of evidence. ", "381. Counsel further said that under Section 100 of the Representation of the People Act, 1951, an election is liable to be set aside if it is found under clause (b) of sub-section (1) of that section that a returned candidate has committed corrupt practice; that ex hypothesi, a returned candidate cannot commit a corrupt practice, and therefore, it is not the description of a person as a returned candidate that is material. He argued that if in Section 100(1) (b) the word 'returned candidate' is used not with the idea of indicating that a person should have committed corrupt practice after he became a returned candidate, there is no reason to think that the word 'candidate' in Section 123(7) has been used to show that the corrupt practice therein mentioned should have been committed after a person has become a 'candidate' in order that the election of the candidate might be set aside. ", "382. There can be no doubt that Section 100(1) (b), when it speaks of commission of corrupt practice by a returned candidate, it can only mean commission of corrupt practice by a candidate before he became a returned candidate. Any other reading of the sub-section would be absurd. But there is no such compulsion to read the word 'candidate' in Section 123(7) in the same manner. It is the context that gives colour to a word. A word is not crystal clear. Section 79 of the Act indicates that the definitions therein have to be read subject to the context. ", "383. The must fix some point of time before which a person cannot be a 'candidate' in an election, and, a wide latitude must be given to the in fixing that point. , this Court observed : (SCC p. 311, para 10)\" ", "The choice of a date as a basis for classification cannot always be dubbed as arbitrary even if no particular reason is forthcoming for the choice unless it is shown to be capricious or whimsical in the circumstances. When it is seen that a line or point there must be, and there is no mathematical or logical way of fixing it precisely, the decision of the or its delegate must be accepted unless we can say that it is very wide of the reasonable mark. See v. per Justice \". ", "384. The learned Chief Justice has, in his judgment, referred to the relevant English statutes and the decisions of the English courts bearing on this point and has pointed out the difference between the English law and the Indian law. I do not consider it necessary to cover the same ground. I agree with his conclusion on the point. ", "385. I would therefore hold that even if it be assumed that the finding of that the appellant obtained or procured the assistance of Shri during the period from January 7 to 24, 1971, is correct, the appellant shall not be deemed to have committed corrupt practice under Section 123(7) of the Representation of the People Act, 1951, as she became a candidate only on February 1, 1971. The learned chief Justice has also dealt with the contention urged by Counsel for respondent that Section 8(b) of the Election Laws amendment Act, 1975 suffers from the vice of excessive delegation and is arbitrary. I agree with his reasoning for repelling the same. ", "386. There can be no dispute that if the Election Laws (Amendments) Act, 1975, is valid, the appeal has to be allowed. I would, therefore, set aside the findings of against the appellant and allow the appeal without any order as to costs. In the cross appeal, the only question raised was about the correctness of the finding of that the appellant has not exceeded the prescribed limit of election expense. For the reasons given by , in his judgment, I hold that the finding of on this issue was correct. In this view, I have no occasion to reach the other question argued. I would dismiss the cross appeal without any order as to costs. ", "387. BEG, J. (concurring). - There are two Election Appeals Nos. 887 and 909 of 1975, before us under Section 116A of the Representation of the People Act of 1951 (hereinafter referred to as 'the Act'). They are directed against decisions on different issues contained in the same judgment of a learned Judge of allowing an election petition filed by (hereinafter referred to as the 'Election-Petitioner'), a defeated candidate at the election held in February, 1971, for the membership of or , against , the Prima Minister of India (hereinafter referred to as 'the Original Respondent'). The election- petitioner is the respondent in Appeal No. 887 of 1975 filed by the original respondent. He is the appellant in Appeal No. 909 of 1975 where the original respondent is the contesting respondent. ", "388. Before the election case, instituted on April 24, 1971, could be decided by , an explanation was added to Section 77(1) of the Act. It had some bearing on questions relating to the expenses incurred on the original respondent's election, sought to be raised by the election- petitioner, but, on findings of fact recorded by , it became immaterial for the merits of the case and would continue to be that so long as the election-petitioner is unable to dislodge 's findings on election expenses. Other amendments were made by the Election Laws (Amendments) Act, 1975 No. 40 of 1975 (hereinafter referred to as the 'Act of 1975'), notified on August 6, 1975, after the decision of the case by the learned Judge of on June 12, 1975 and after the filing of the appeals before us. These amendments deal directly with several questions decided by which were pending consideration before this Court. Finally, came the Constitution (Thirty ", "389. It was submitted by the learned Counsel for the original respondent, in his opening address, that Section 4 of the Thirty-ninth Amendment, adding clause (4) to Article 329-A of the Constitution, meant that itself, acting in its constituent capacity, had taken the case in hand and had, after applying its own standards, decided it in favour of the original respondent so that the jurisdiction of this to go into the merits of the case was ousted by clause (4), read with clauses (5) and (6), sought to be added to Article 329-A of the Constitution. It was submitted by him that each one of the amendments of the Act was aimed at removing genuine uncertainties or doubts about what the law was so that it may be brought into line with what it had been previously understood to be as declared by this , or, in any case, with what , correctly exercising its unquestionable law-making powers, thought that it should be. ", "390. The constantly recurring and vehemently pressed theme of the arguments of the learned counsel for the election-petitioner was that the context and the contents of the Acts of 1974 and 1975, and, after that, of Section 4 of the Thirty-ninth Amendment, clearly indicated that the whole object of the Acts of 1974 and 1975 and of the constitutional amendment was an oblique one : to deprive the election-petitioner of the remedies he had under the law against an election vitiated by corrupt practices, and of the benefits of a decision of in his favour by taking away its grounds and then the jurisdiction of courts, which existed at the time of the Thirty-ninth Amendment, to deal with the case so that this case may not, in any event, terminate in favour of the election-petitioner. It was repeatedly suggested by the learned Counsel for the election-petitioner, throughout his arguments, that the law-making powers had been really abused by a majority in for the purposes of serving majority ", "391. In the circumstances indicated above, it seemed to me to be absolutely essential for us to call upon the parties defending or assailing the Thirty-ninth Amendment and the Acts of 1974 and 1975, to take us, inter alia, into the merits of the cases of the two sides and the findings given by the trying Judge so as to enable us to see how far these findings were justifiable under the law as it stood even before the amendments by the Acts of 1974 and 1975, how they were affected by these amendments, and how they were related to the validity of Section 4 of the Thirty-ninth Amendment. Speaking for myself, I clearly indicated to learned Counsel for the parties that I regard the nature and merits of the case decided to be of crucial importance not only in considering the validity of the Thirty- ninth amendment and of the Acts of 1974 and 1975, but also in the wider interests of justice which are bound to be served by the vindication of the case of the party which should, on merits, win. Elementary considerations ", "392. Citizens of our country take considerable pride in being able to challenge before superior courts even an exercise of constituent power, resting on the combined strength and authority of and . This , when properly called upon by the humblest citizen in a proceeding before it, to test the constitutional validity of either an ordinary statute or of a constitutional amendment, has to do so by applying the criteria of basic constitutional purpose and constitutionally prescribed procedure. The assumption underlying the theory of judicial review of all law-making, including fundamental law-making is that courts, acting as interpreters of what has been described by some political philosophers (see : 's \"Philosophical Theory of the State\" Chap. V, pp. 96, 115) as the \"Real Will\" of the people, embodied in their Constitution and assumed to be more lasting and just and rational and less liable to err than their \"General Will\", reflected by the opinions of the majorit ", "393. Issues raised before us relating to the validity of the Thirty-ninth amendment and the Acts of 1974 and 1975, were : What are the constitutional purposes and ambit of the \"constituent power\" found in Article 368 of our Constitution ? Were they, in any way, exceeded by the constituent authorities in making the Thirty-ninth amendment in an unauthorised manner, or, for objects which, however laudable, were outside the scope of Article 368 ? Was there any procedural irregularity in the composition of which could enable this Court to hold that there was a basic defect in the enactment of either the 1975 Act or of the Thirty-ninth amendment ? Whether provisions of the Acts of 1974 and 1975 are immune from attack even on the ground that they resulted in a departure from the \"basic structure\" of our Constitution as explained by this Court in , by having been included in the Ninth Schedule of our Constitution, which does protect them f ", "394. We do not, when such a case comes up before us, concern ourselves with the validity of provisions other than those which affect the case before us. Nor do we consider the objects of any provisions, in vacuo, divorced from the facts of the case to be decided. Therefore, parties had to and did address us on the broad features of the findings given by the learned trial Judge and the nature of the evidence given to support them so that we may be able to decide, inter alia, whether any \"validation\" of the original respondent's election, which was the evident purpose of clause (4) of Article 329A , sought to be added by Section 4 of the Thirty-ninth amendment, was at all necessary. If that election was not really void an had been wrongly held by the trial Court to be vitiated, it did not need to be validated at all. In that event, a purported validation would be an exercise in futility before this Court had decided these appeals. Could it not be said that the intended validation was premature inasmuch as it pr ", "395. If the existence of the judgment of created the impression that it must be assumed to be correct even before this Court had pronounced upon the correctness of the judgment, the stay order given by this Court should have removed it. The legal effect of that stay order was that the trial Court's order, to sue the language of Section 116A(4) of the Act, \"shall be deemed never to have taken effect\". It did not matter if the stay order, out of deference for existing precedents, had been framed in the form of a \"conditioned\" stay, that is to say, a stay in law and effect with certain conditions annexed. It was not a \"conditional\" stay. Indeed, having regard to the nature of the order the operation of which was to be stayed, there could be no \"conditional\" stay here. As to the legal effect of such a stay order, there is no doubt in my mind that, considering the clear words of Section 116A(4) of the Act, it deprived the order of of any operative force whatsoever during th ", "396. In a case where the bona fides of legislation and even of a constitutional amendment, is questioned on the ground of a suggested frightfulness in the facts of the case which and the ratifying State Legislatures are to be supposed, if we are to accept the suggestion, to have been acting in concert to prevent this Court from examining on merits, it was, I think, the duty of Counsel making any such suggestion to invite our attention to any fact not fully disclosed or discussed in the judgment under appeal at least when he was asked, as I repeatedly asked him in the course of his arguments extending over a period of about fifteen days out of a total period of hearing of the case for thirty-two days, how conclusions on the two matters, forming the subject- matter of Appeal No. 887 of 1975 of the original respondent, could possibly be justified. However, I have also satisfied myself, by going through the whole evidence on record on these two matters, which I shall presently deal wi ", "397. was elected to from the Rae Bareli constituency in Uttar Pradesh by an overwhelming majority of 1, 11, 800 votes against . As is not unusual, the defeated candidate filed an election-petition under the Act making all kinds of allegations, including some quite extravagant ones, which formed the subject-matter of the first set of eleven issues framed on August 19, 1971. Thereafter, three additional issues were framed on April 27, 1973, when the question whether an amendment of the petition, sought after the period of limitation for filing a petition to challenge the election had expired, should be permitted, had been finally decided by this Court in favour of . ", "398. The issues framed give an idea of the cases set up on behalf of the two sides. They were : ", "ISSUES\" ", "1. Whether respondent No. 1 obtained and procured the assistance of in furtherance of the prospects of her election while he was still a gazetted officer in the service of . If so, from what date ? ", "2. Whether at the instance of respondent No. 1 members of the armed forces of the Union arranged planes and helicopters for her, flown by members of the armed forces, to enable her to address election meetings on February 1, 1971 and February 25, 1971, and if so, whether this constituted a corrupt practice under Section 123(7) of the Representation of the People Act ? ", "3. Whether at the instance of respondent No. 1 and her election agent , the district Magistrate of Rae Bareli, the Superintendent of Police of Rae Bareli and the Home Secretary of arranged for rostrums, loudspeakers and barricades to be set up and for members of the police force to be posted in connection with her election tour on February 1, 1971 and February 25, 1971; and, if so, whether this amounts to a corrupt practice under Section 123(7) of the Representation of the People Act ? ", "4. Whether quilts, blankets, dhoties and liquor were distributed by agents and workers of respondent No. 1 with the consent of her election agent , at the places and on the dates mentioned in Schedule A of the petition in order to induce electors to vote for her ? ", "5. Whether the particulars given in paragraph 10 and Schedule A of the petition are too vague and general to afford a basis for allegations of bribery under Section 123(1) of the Representation of the People Act ? ", "6. Whether by using the symbol cow and calf, which had been allotted to her party by in her election campaign the respondent No. 1 was guilty of making an appeal to a religious symbol and committed a corrupt practice as defined in Section 123(3) of the Representation of the People Act ? ", "7. Whether on the dates fixed for the poll voters were conveyed to the polling stations free of charge on vehicles hired and procured for the purpose by respondent No. 1's election agent , or other persons with his consent, as detailed in Schedule B to the petition ? ", "8. Whether the particulars given in paragraph 12 and Schedule B of the petition are too vague and general to form a basis for allegations regarding a corrupt practice under Section 123(5) of the Representation of the People Act ? ", "9. Whether respondent No. 1 and her election agent incurred or authorised expenditure in excess of the amount prescribed by Section 77 of the Representation of the People Act, read with Rule 90, as detailed in para 13 of the petition ? ", "10. Whether the petitioner had made a security deposit in accordance with the rules of as required by Section 117 of the Representation of the People Act ? ", "11. To what relief, if any, is the petitioner entitled ?ADDITIONAL ISSUES ", "1. Whether respondent No. 1, obtained and procured the assistance of in furtherance of the prospects of her election while he was still a gazetted officer in the service of . If so, from what date ? ", "2. Whether respondent No. 1 held herself out as a candidate from any date prior to February 1, 1971 and if so, from what date ? ", "3. Whether continued to be in the service of from and after January 14, 1971 or till which date ? ", "399. trying the case had, in the course of a lengthy judgment, rejected the election-petitioner's case on issues Nos. 2, 4, 6, 7 and 9 of the first set of issues, after minutely and meticulously scrutinizing every material allegation of the election-petitioner and the evidence given in support of it on each of these issues. Out of these, the election-petitioner, in his Cross Appeal No. 909 of 1975, has questioned the findings of only on issues Nos. 2, 4, 6, 7 and 9 set out above. Issues Nos. 5, 8 and 10, decided in favour of the election- petitioner, were technical and are immaterial now. It will be noticed that the additional issue No. 1, due to some error or oversight, is an exact and unnecessary repetition of the initial issue No. 1. Additional issues numbered 2 and 3 are connected with and subsidiaries of the initially framed issues numbered 1 and 3. ", "400. The learned trial Judge had accepted the election-petitioner's case of the material issues numbered 1 and 3 of the initially framed issues, and on the overlapping and subsidiary additional issues 1, 2 and 3. He was of opinion that , a servant and a gazetted officer of the rank of an Under Secretary, deputed to serve in the Prime Minister's Secretariat as an Officer on Special Duty, had held his post until January 25, 1971, when his resignation, tendered on January 13, 1971, was accepted by the President of India with effect from January 14, 1971, by means of a notification published on February 6, 1971. Consequently, the learned Judge set aside the election of the original respondent after holding that she was guilty of a \"corrupt practice\", as defined by Section 123(7) of the Act, on each of two grounds : firstly, that she must be deemed to have obtained the help of , in the furtherance of her election, before he had ceased to be a gazetted officer ", "401. The law, as found in the Act of 1951 did not, unlike the English Act of 1949, make a distinction between corrupt practices and illegal practices. Section 123(7) , as it has stood unamended, enumerates, as the last of the 7 classes of corrupt practice, as follows : ", "\" Section 123 (7) the obtaining or procuring or abetting or attempting to obtain or procure by a candidate or his agent or, by any other person with the consent of a candidate or his election agent, any assistance other than the giving of vote for the furtherance of the prospects of that candidate's election, from any person in the service of the Government and belonging to any of the following classes, namely :- ", "(a) gazetted officers; ", "(b) stipendiary judges and magistrates; ", "(c) members of the armed forces of the Union; ", "(d) members of the police forces; ", "(e) excise officers; ", "(f) ", "(g) * * * Explanation. - (1) In this section the expression 'agent' includes an election agent, a polling agent and any person who is held to have acted as an agent in connection with the election with the consent of the candidate. ", "(2) for the purposes of clause (7), a person shall be deemed to assist in the furtherance of the prospects of a candidate's election of the acts as an election agent of that candidate\". ", "402. It is clear that\" the obtaining or procuring or abetting or attempting to obtain or procure\"had to take place either by a candidate or by his agent or by somebody\" with the consent of the candidate or his election agent\" ", ". Until the candidate had appointed an election agent, the action of any other person could not constitute him automatically an agent so that he may, by doing something voluntarily, succeed in making the candidate vicariously liable for his own actions whether he was or was not a gazetted officer at the time when he committed the act complained of. The question of obtaining assistance through \"an agent\" or \"other person with the consent of a candidate or his election agent\" could only arise where such a case of obtaining assistance indirectly through others is set up but not otherwise. ", "403. On issue No. 1, the case set up in paragraph 5 of the petition is : ", "\"Smt. Indira Nehru obtained and procured the assistance of the said Shri for the furtherance of prospects of her election from the constituency aforesaid inasmuch as the said Shri was a gazetted officer in the service of Government of India when his assistance was obtained and procured......... The said Shri on the direction of Smt. Indira Nehru organized the electioneering work for her in the constituency during the period commencing from December 12, 1970..........\" ", "It is a case of liability resulting from an alleged\" direction\" ", "given by Smt. herself to . No case of procurement of assistance of through a third person is set up although the word \"procured\" is mechanically lifted from Section 123(7) and used. On issue No. 3, the case set up in para 9 of the petition is that both Smt. and her election agent, , \"obtained and procured\" the assistance of government officers, but no directions or orders given by anyone are mentioned there. Issue No. 1 shows that the case which was put in issue here was whether the government officers mentioned there rendered the assistance indicated there \"at the instance\" of the original respondent or her election agent. The discussion of evidence and findings of the learned Judge, particularly on issue No. 1, show that the learned Judge had almost made out a new case for the election-petitioner and accepted it. This was, on issue No. 1, whether had done some acts in ", "404. The law must lay down a duty to prevent, by taking some steps which are not taken, before a person is held liable for an omission. And, there is a difference between omission to prevent the doing of something and actual consent to the doing of it. I do not find, in the petition, any case of a liability from omissions to do something set up, obviously because the law does not impose upon the candidate the duty to prevent the giving of voluntary assistance by others whether officials or not. Nor is there anywhere in the petition a case of procurement by consenting to aid obtained through others. It has to be remembered that, on the language of Section 123(7) , a liability is not created by merely not rejecting voluntarily given aid. The candidate may not often be aware of the voluntarily given assistance so as to be able to reject it. A case of consent which can be legally set up is only one of consenting to active obtaining or procurement by an agent or by some other person who becomes, for the purposes o ", "405. On the terms of Section 123(7) the following three types of cases of actual obtaining of assistance, as distinguished from abetment or attempting to obtain it, can be legally set up either exclusively, or alternatively, against a candidate firstly, a direct obtaining of it by the act of the candidate himself, secondly, an indirect or vicarious procurement of it by the acts of a duly constituted agent, and, thirdly, an indirect or vicarious procurement of it by the acts of a person who, though not a duly constituted agent, becomes constructively an agent, for the purpose of some particular aid obtained because it was assented to by the candidate at a time which must, ordinarily, be before the aid is given, so that the person through whom assistance is obtained is a constructive agent for this particular aid at the time when it is given. The term procurement should, strictly speaking, apply only in the last two types of cases. A reference to Section 100(1) (b) further emphasises the position that a corrup ", "406. As I read the petition, I find only the first of the three types of cases mentioned above set up exclusively on issue No. 1 because there are no particulars there which could apply to the other two types of cases. Obviously, the case set up was not of a corrupt practice by some act of a person to which the candidate became a party by merely giving consent in which case the circumstances from which the consent was to be inferred had to be indicated. It was a case of a direction given by the Prime Minister herself to Shri who, it had to be presumed for the purposes of such a case, would not have given the aid if the direction or order was not there. This deliberately given \"direction\" had to be proved on the case set up. On issue No. 3, the petition mentions only what was obtained, that is to say, the aid of the particular officers and the form it took, but, what caused that aid to be given or the means adopted to get it were not set up there. I think these distinctions should have been borne in min ", "407. The definition given above in Section 123(7) meant, on an ordinary and natural interpretation of words used, that the corrupt practice defined there could not be committed by any person before there was a \"candidate\" for an election. Hence, it became necessary to examine the definition of a \"candidate\" found in Section 79(b) which laid down : ", "\"79. In this part and in Parts VII and VIII, unless the context otherwise requires, ", "(b) 'candidate' means a person who has been or claims to have been duly nominated a candidate at any election, and any such person shall be deemed to have been a candidate as from the time when, with the election in prospect, he began to hold himself out as a prospective candidate.\" ", "408. Section 123 , defining corrupt practices, is found in Part VII of the Act. Therefore, the definition of candidate in Section 79 , as it originally stood, was sought to be applied by the trial Court to determine whether the original respondent could have committed a corrupt practice at the time of the alleged commission of it. Before, however, I deal with that question, it is necessary to examine what \"obtaining, or procuring or abetting or attempting\" meant in the light of the law laid down repeatedly by this Court in cases of alleged corrupt practices. ", "409. The logical consequence of placing a charge of corrupt practice on the same footing as a criminal charge is obligation to interpret the words which define it strictly and narrowly. Indeed, any natural and ordinary interpretation on the words \"obtaining or procuring or abetting or attempting\" must carry with it the imperative requirement that the candidate concerned or his agent must have intentionally done an act which has the effect contemplated by Section 123(7) . In other words, a \"mens rea\" or a guilty mind as well as an \"actus reus\" or a wrongful act must concur to produce the result contemplated by law. So far as election expenses are concerned, it is possible to conceive that even an unintentional result (i.e. expenses \"incurred\" exceeding the prescribed limit may be enough so that a duty to prevent this result may be there in law. But, Section 123(7) requires actual intended acts of \"obtaining\" or \"procuring\" or attempting or abetting. For Section 123(7) results are immaterial. ", "410. In the case before us, the petition contains, as I have indicated above, the necessary averment of a deliberate direction by the original respondent herself, so far as issue No. 1 is concerned, and of \"obtaining\" and \"procuring\" as regards issue No. 3. These are enough to denote the ingredients of a mens rea. But, one will search the evidence in vain for any indication of a mens rea or guilty intent on the part of the original respondent or of her election agent when she had appointed one. As regards both issues Nos. 1 and 3, the learned Judge seemed to think that Section 123(7) creates what is called an \"absolute statutory liability\", which does not require a mens rea although, in dealing with issue No. 2, he had himself, after citing the necessary authorities, taken the view that a mens rea was also essential. He had himself, in dealing with issue No. 2, distinguished , a decision with whose ratio decidendi I have never, with due respect, felt happy in so far as it meant ", "411. Let me here quote the exact language used by the trial Judge himself in giving his findings on the first part (relating to December 27, 1970 to January 13, 1971) of issue No. 1 of the \"first set\" of issues combined with the issue No. 1 of the additional issues, both issues, for some inexplicable reason, being identically worded. The learned Judge said : ", "\"Learned Counsel for the respondent then urged that even accepting that Shri delivered a speech at Munshiganj on January, 7, 1971 and that he canvassed support for the respondent in that speech, he was not an election agent on that date, and there is no evidence of the fact that he had been instructed to do so by the respondent No. 1 Learned Counsel stressed that, consequently, it should not be held on that basis that the respondent No. 1 obtained or procured the assistance of Shri for the furtherance of her election prospects.I have given my careful consideration to this argument as well, but I regret my inability to accept the same. As also stated earlier, Shri was occupying a position of trust and confidence with the respondent No. 1 since quite a long time. During the period in question he was Officer on Special Duty in the respondent No. 1's Secretariat. In 1967 he had resigned from his post for the sake of respondent No. 1 to be able to do her election work in the constituency. After that was done, he was taken back in the respondent's Secretariat as Officer on Special Duty. Respondent No. 1 held herself out as a candidate on December 29, 1971. On January 5, 1971 was sent to the constituency. On January 7, 1971 Shri visited Rae Bareli, and on the own admission of respondent No. 1, he did so with previous notice to the respondent No. 1. The subsequent events also appear to be material, for, according to Shri , immediately on return from Rae Bareli he held a talk with To sum, therefore, it is satisfactorily proved that the respondent No. 1 during the period ending on January 13, 1971, obtained/procured the assistance of Shri , a gazetted officer in for the furtherance of her election prospects, inasmuch as Shri was made to go to Rae Bareli on January 7, 1971 and deliver a speech at Shaheed Mela in Munshiganj canvassing support for her candidature.\" ", "412. Now, it is a well settled rule, repeatedly laid down by this , that allegations of corrupt practice in the course of an election must be judged by the same standards as a criminal charge. And, no rule of evidence, in judging guilt on a criminal charge, is more firmly rooted than that no charge, resting on circumstantial evidence, could be held to be proved beyond reasonable doubt unless the chain of circumstances is so complete and so connected with the charge that it leaves no other reasonable hypothesis open for the to adopt except that the offender had committed the offence alleged (See : e.g. ). ", "413. The learned Judge dealt with evidence on issue No. 1 relating to the activities of by dividing it into three periods : (1) from December 12, 1970 to January 13, 1971, when had not resigned from government service; (2) from January 14, 1971 to January 25, 1971, the period after 's resignation upto its acceptance by the President of India evidenced by a notification dated January 25, 1971; (3) from January 26, 1971 to February 6, 1971, the period after the acceptance of 's resignation and upto the date of the publication of it in the official gazette. The learned Judge considered only the first two periods material as he held the activities in the third period to be above board because was free to do what he liked in this period. Hence, the fact that the original respondent appointed her election agent on February 1, 1971 made no difference to the result in the third period to be above board because was free to do what he l ", "414. Let us take the first period. What was required to be approved, beyond all reasonable doubt, from the evidence on record on this part of the case, was that had been instructed or directed by the original respondent to render the help, if any, that he did given by the speech he was alleged to have made at a fair at Shaheed Mela (martyrs' fair) at Munshiganj in Rae Bareli on January 7, 1971, canvassing support for the original respondent's election - an allegation which had denied in so far as any mention of the original respondent's candidature is concerned. admitted that he had gone there with , a former Minister of , but said that he had only, when called upon to do so, paid his tribute to the memory of the martyrs. ", "415. The learned Judge held that the recollection of about what he said at the Shaheed Mela on January 7, 1971 was less reliable than the statement of (PW 43), an Advocate belonging to an opposition party, supported by his political coworker, (PW 28) - a witness who, in his transparent anxiety to appeal truthful, went so far as to make the absurd assertion that he had not told anyone, before he appeared in the witness box, that he had attended the Shaheed Mela on January 7, 1971, and who could not remember either the date of his marriage or the dates of births of his children, but asserted that he had noted January 7, 1971 without even having ever talked on any previous occasion to anyone about this date if he is to be believed - and, by (PW 31), a joint editor of a newspaper, who claimed to be present on the occasion and who, while reporting other facts and reasons in his newspaper for believing that the original respondent will stand ", "416. The learned Judge disbelieved the evidence of the original respondent's witness (RW 12), the headmaster of a school, who had denied that he ever accompanied (PW 28) to as claimed by . The ground for holding that must be deposing falsely appears to me to be every unfair both to and Shri , a man, who was suspected, without the slightest foundation in evidence, of having induced to give perjured evidence simply because , who did not even appear as a witness, was a member of the (R) party and was once connected with the school in which served. The learned Judge said : ", "\"It is quite likely that once had conceded in cross-examination that had accompanied him to the Shaheed Mela, pressure was brought to bear on (RW 12) by in order to make him appear as a witness in the case and give evidence to contradict the testimony of . It is true that in his re-examination (RW ", "12) admitted that on the date on which he was examined as a witness in the case the school was being run by the under the control of the District Basic Education Officer. However, the association that had with the in his capacity as Adhyaksha, and consequently with , who was a teacher in that , could not have been wiped off overnight merely because the school was taken over by the to be run under its own officers. ", "417. The reasons given by the learned Judge for holding that it was \"abundantly clear\" that (RW 13), another witness of Smt. , was \"also not a truthful witness\", were :\" ", "Now, since is a resident of the same village where resided, and since he was an important worker for the respondent No. 1 during the election and was also her Pairokar at some stage, the possibility of having been pressurised by cannot be excluded. Together with it there is also the fact that , another important worker of the respondent No. 1, happened to be the Adhyaksha of during the period the witness was examined in the case. It is a matter of common knowledge that the Adhyaksha of during the period the witness was examined in the case. It is a matter of common knowledge that the Adhyaksha of always wields influence in the rural areas. It will not be out of place to add that when it was put to in cross- examination as to which party did belong, he pleaded ignorance about it. It cannot be accepted for any moment that even though ", "418. I do not know how, when workers of the party were divided into two camps and had been changing sides, from time to time, ignorance of a worker's precise party loyalties meant that was untruthful. If mere possibilities of being \"pressurised\" or biased were enough to tar a witness as untruthful, it is difficult to see how or why the witnesses of the election-petitioner, on whom lay the primary burden of proof, could escape similar treatment. , was, no doubt, an Advocate. But, he was not even paying Income-tax. He felt free, on a working day in courts, to go to the Mela. He was enthusiastic enough as a member of an opposition party to object, according to himself, to bringing in the candidature of the original respondent even at a meeting which, according to him, consisted mostly of (R) sympathisers. was not so ignorant or inexperienced in election matters and could not be assumed, without any evidence to support the assumption, to ", "419. Let us, for the sake of argument, assume that had been overpowered by such a desire to exhibit an excessive zeal, which got the better of his prudence that he, believing that a publicly made gesture of his loyalty was needed on this particular occasion, cast all caution to the winds and, while paying the tribute he was called upon to pay to the memory of the martyrs, suddenly decided to jump into the electoral fray by making an appeal at the martyrs' mela to support Smt. , as though the speeches of all those local leaders who, in addition to , a former Minister, are said to have spoken there to the same effect, were not enough. What follows ? It is here that we find the weakest link in the misty and fanciful chain of the learned Judge's logic. Where was the evidence that, whatever else may or may not have been supposed to do on his visit to Rae Bareli, this particular piece of \"frolic\", a term used by law relating to scope of author ", "420. The learned Judge, as is evident, from his summary of evidence and conclusions, relied on circumstantial evidence only. But, in order that the circumstances should have a conclusive effect, so as to exclude any reasonable hypothesis except that of guilt, they had to point in one direction only and in no other. What is the position that emerges from a consideration of the circumstances found and detailed by the learned Judge himself ? It was held that was occupying a position of trust and confidence with the original respondent for quite a long time. Indeed, his evidence shows that he was so attached to the family of the original respondent and the political and national causes its members had represented that he was just the type of person who could, even without the slightest suggestion on the part of the original respondent have voluntarily take upon himself the duty to do whatever he could do in his private capacity to help her return at the election. Indeed, his private capacity, ", "421. In the passage from the judgment, quoted above, the learned Judge draws an inference of a previous instruction, from the Prime Minister to , to say what he is alleged to have said in a speech, because, inter alia, met the Prime Minister on his return from Rae Bareli Again, the necessary inference of a previous intimation by to the Prime Minister of his intention to visit Rae Bareli, could not be that there was any authority or direction given by the Prime Minister to to do or to say anything on her behalf. All this would lie in the realm of pure conjecture and suspicion. It left other possible and more reasonable inferences wide open. ", "422. The learned Judge had himself held, so far as use of rostrums is concerned, that the Prime Minister sheds her personality, as the holder of her office, and assumes the role of a mere candidate as soon as she ascends a platform to make an election speech. But, when the learned Judge deals with the action of , in making a speech from a platform at a martyrs' mela, because is called upon to pay his tribute to the martyrs, he holds that not only must the capacity of a government servant unshakably stick to him, but that must have been authorised by the Prime Minister herself knowing, as she did, that he was a government servant, to go and make a public speech at the mela and canvass for votes for her I do not think that we can indulge in a flight of fancy which could be described as \"flamboyant\". ", "423. The uncontroverted evidence of which had been ignored by the trial Judge was that it was the special business of this witness, as an Officer on Special Duty in the Prime Minister's Secretariat, in his own words, \"to deal with the representations received from public and other works of semi-political nature\" ", ". It is difficult to understand how the occupant of such a difficult and responsible office as that of the Prime Minister of the numerically largest democracy in the world can possibly discharge his or her duties towards the public satisfactorily without the aid of such officers. Naturally, as the Prime Minister was contemplating standing for election from the Rae Bareli constituency, it would not be outside the scope of the duties of such an officer to attend especially to the complaints and representations from Rae Bareli. He stated that , who was then the Railway Minister, had received some representations from Rae Bareli. He also said that he had, from time to time, ", "424. Again, without any contradiction from any evidence whatsoever, his statement, unquestioned also in cross-examination, was that the Prime Minister did not, at any time, ask him, in his own words, \"either directly or indirectly to do anything pertaining to her election.\" The Prime Minister's replies to interrogatories served upon her show that she had no personal knowledge of what did at Rae Bareli before he was appointed her election agent. It is also apparent from the evidence of this witness and of the Prime Minister herself that, when he expressed his desire on January 9 or 10, 1971, to the Prime Minister to resign from his post as Officer on Special Duty, she asked him to think over the matter as this would mean that he could not return to his post. He had earlier said that this decision was taken with a view to do work for the public in general and the party in particular as he wanted to enter public life. It is clear that the Prime Minister had left the decision entirely to the ", "425. The statement of , supported by those of the Prime Minister and Shri , had been accepted by as correct so far as tender of this resignation and its acceptance, in all the stages, followed by the notification in the gazette, went. The learned Judge held that the President gave his assent on January 25, 1971. 's letter of resignation must have been duly forwarded and was acted upon. This was the learned Judge's finding. did not work in after January 13, 1971 and he drew no salary as government servant after that date. The notification in the gazette could not, according to rules, take place until had handed over charge. He signed and completed the necessary papers relating to relinquishment of the charge of his office on January 13, 1971, but he put the date January 14, 1971 under his signature on the document evidencing a formal handing over of charge as it was to take effect from that date. The trial C ", "426. On the facts stated above, there could be no doubt whatsoever that was not asked to do anything at all in connection with her election by the Prime Minister herself, but he had decided to take interest in it voluntarily as he had some political ambitions; and, therefore, he had asked the Prime Minister to be relieved of his office in her Secretariat with effect from January 14, 1971. It is unfortunate that the learned Judge thought that there was something almost sinister in taking such interest in the election or in hoping to enter political life through absolutely legitimate means. There is not the slightest reason for anyone who fairly examines the evidence of , supported by that of the Prime Minister and , to doubt the motives or the veracity of on this point. He frankly stated that his ambition was to enter political life. In any case, the motives of were not on trial. If such assistance as he may have rendered was entirely volun ", "427. was aware of and cited the applicable rule for a resignation by a temporary government servant, as was, and stated also the practice followed, in his experience, in such cases. He, presumably thought that the resignation was effective from January 14, 1971. also acted upon that assumption and in that belief. The Prime Minister, who could not be expected to examine suo moto the question whether and were right in their beliefs about the effectiveness of the resignation, assumed that everything was alright. In any case, there could not possibly, on these facts, be any mens rea on her part. ", "428. The learned Judge having accepted, on the unimpeachable evidence of the date of notification of January 25, 1971, published in the official gazette on February 6, 1971, that Shri must have handed in his resignation in a letter of January 13, 1971, it is very difficult to see how one could possibly doubt the correctness of the statement of Shri that, as the Head of the Prime Minister's Secretariat, he had accepted the resignation orally and forwarded it on for necessary action. The resignation had taken place with the consent of the Prime Minister. It is inconceivable, in the circumstances, that Shri would not have as the Head of the Department in which Shri was working, agreed to relieve him of his duties by telling him that he was a free man, and, thereby, accepted his resignation. He, very honestly, stated that he does not remember whether he wrote anything on the margin of that letter. He must have made so many indorsements on so many letters and documents that i ", "429. The learned Judge had found Statement, that such an oral acceptance, followed by the necessary notification afterwards, was \"rather interesting\", and, that the resignation could not be effective until January 25, 1971, the date of drafting the notification. But, what the learned Judge completely overlooked was that the notification itself made the resignation effective from January 14, 1971, the date from which had neither worked in the Prime Minister's Secretariat nor drawn any salary. There was no plea anywhere, and there is no express finding on it, that the President's notification itself, which made the resignation effective from January 14, 1971, was invalid to the extent that in purported to give any retrospective effect to the resignation, in the sense that it made it effective from a date prior to its actual acceptance. The fact that it is made effective from January 14, 1971 shows that the letter must have reached the President's Secretariat with the request that ", "430. The learned Judge had relied on Rule 5 of the Central Civil Services (Temporary Service) Rules, 1949, which runs as follows : ", "\"5(a) The service of a temporary Government servant who is not in quasi- permanent service shall be liable to termination at any time by notice in writing given either by the Government servant to the appointing authority, or by the appointing authority to the Government servant. ", "(b) The period of such notice shall be one month, unless otherwise agreed to by the Government and by the Government servant : ", "Provided that the service of any such Government servant may be terminated forthwith by payment to him of a sum equivalent to the amount of his pay plus allowances for the period of the notice or as the case may be, for the period by which such notice falls short of one month or any agreed longer period.\" ", "431. The learned Judge had referred to Halsbury's Laws of England, Vol. V (Simonds's Edn.) p. 61, where it was laid down that in a \"corporation created by Statute for the discharge of public functions a member may not have an absolute right to resign at will, because the law may cast a duty upon the person elected to a public office to act in that office in public interest\" ", ". He also referred to an American case, v. United States, to the effect that only the appointing could have accepted the resignation of an occupant of a public office, and that, under the special provisions of the law, the holder of such an office could be subjected to a penalty for a wrongful refusal to perform the duties of his office. The desire or wish of the holder of the office had to give place to public interest in such special cases. It is clear that the cases cited could have no relevance whatsoever for an interpretation of Rule 5 set out above. ", "432. The learned Judge had then relied upon , were this Court held that \"normally, and in the absence of any law or rule governing the conditions of his service to the contrary, it will not be open to the public servant to withdraw his resignation after it is accepted by the appropriate authority\" ", ". In that case, there was a dispute between the government servant and on the question whether the government servant concerned could withdraw his resignation after it was accepted. It was held that he could not. It was not a case of an agreement between the parties at all as to the date from which the resignation could effectively terminate service. It is true that, in , when this very matter came up to this Court, to decide whether an issue should be struck on it, this Court had sent back the matter to after holding that an issue should be framed to decide when resignation became effective and that this ", "433. Neither the nor the government servant is in a worse position than an ordinary master or servant on a matter governed by contract. In fact, Article 310 makes it clear that, in such a case, the tenure of office of a Central servant is \"during the pleasure of the President\". In the instant case, the President's pleasure was contained in the notification dated January 25, 1971 showing that the President had accepted the resignation of Shri with effect from the forenoon of January 14, 1971. And, this is what Shri himself wanted. Hence there is no difficulty at all in accepting the correctness of a resignation effective from the date which both parties to the contract, on patent facts, had agreed by such an acceptance of the resignation from the date immediately after the date on which Shri had tendered his resignation. That, as already pointed out, was also the date after which he had ceased to work or draw his salary. It is inconceivable that the law should thrust t \"(3) For the purposes of clause (7), notwithstanding anything contained in any other law, the publication in the Official Gazette of the appointment, termination of service, dismissal or removal from service of a person in the service of the Central (including a person serving in connection with the administration of a Union territory) or of a State shall be conclusive proof - ", "(i) of such appointment, resignation, termination of service, dismissal or removal from service, as the case may be, and ", "(ii) where the date of taking effect of such appointment, resignation, termination of service, dismissal or removal from service, as the case may be, is stated in such publication, also of the fact that such person was appointed with effect from the said date, or in the case of resignation, termination of service, dismissal or removal from service, such person ceased to be in such service with effect from the said date.\" ", "434. I find that this amendment, which was made retrospective, by Section 10 of Act 40 of 1975, makes the legal position still clearer. The learned Counsel for the election-petitioner had assailed the validity of this amendment on the ground that powers conferred by it upon the Government are bound to be abused by those who hold the reins of Government. I am afraid I am unable to see any force in this contention. The presumption is that a bona fide use will be made of this power lodged in such responsible hands. If such powers are ever exercised in a mala fide manner, it is the particular exercise of the power that can be questioned and struck down. The provision does not become invalid merely because it could be abused as practically any provision of law can be by those who may want to do so. ", "435. I will next take up the period from January 14, 1971 upto January 25, 1971, when is said to have gone and voluntarily worked at Rae Bareli, and to have done whatever he could to organise the conduct of the Prime Minister's election after his talks with the Prime Minister. The position with regard to allegations in this period is summarised as follows : ", "1. He is said to have either led or to have joined a procession of cars taken out on January 14, 1971 in the town of Rae Bareli as a part of the election campaign for the original respondent although (PW ", "41), an advocate, who was a staunch S. S. P. worker, produced on behalf of the election-petitioner, clearly stated that he had not seen in that procession which he watched but he had seen him only on February 15, 1971. The learned Judge, however, not only relied on the evidence of (PW 42) but also on that of to hold that must have been \"associated with\" the procession of people seen in cars and jeeps taken out on January 14, 1971 shouting (R) party slogans to start off the election campaign. ", "2. On January 17, 1971, is said to have participated in an election meeting held at the Clock Tower. On this allegation, the learned Judge accepted the evidence of (PW 31), and , (PW 42), although both these witnesses only stated that some confusion took place at the meeting and did not even remember whether any speech was made at all by . also did not state that actually made a speech but had said that \"a disturbance took place when wanted to deliver a speech....... as a result of which he could not do so\" ", ". The learned Judge rejected the evidence of (RW 18) supported by (RW 32) himself, that was not present at all at this meeting. However, on the evidence of the election petitioner's witness themselves, could do nothing whatsoever in furtherance of the election of the original respondent at this meeting. ", "3. On January 19, 1971, Shri is said to have addressed a meeting at village Nihasta where he is said to have gone in the company of Prof. , a Minister of State in the Government of India. Although the tour programme of the Minister concerned showed that the Minister went to that village to inaugurate a telephone exchange on January 18, 1971, supported by the evidence of (RW 16), a resident of village Nihasta, and (RW 17) Post Master, , yet, the learned Judge preferred the evidence of (PW 42) for the election- petitioner despite the infirmity in this evidence that it was neither consistent with the tour programme of the sent in advance for this function nor with the unshaken evidence of those who organised the function. ", "4. It was alleged that on January 19, 1971, again in the company of Prof. , the Minister, mentioned above, attended a meeting held in Lalganj. So far as this particular allegation is concerned, the learned Judge thought that it could not be accepted because it was supported only by one highly partisan witness, , against 4 faultless witnesses : (RW 25), (RW 26), (RW 27) and (RW 28). ", "5. On January, 19, 1971, was said to be present at the inaugural function of the telephone exchange at Behta Kalan and is said to have delivered a speech there. The learned trial Judge accepted the evidence of Pt. (PW 32), admittedly a highly partisan witness, who was believed because of a question put to him in cross-examination suggesting that there was uproar when started speaking so that nobody could hear what he said. The learned Judge held that this amounted to an admission of 's presence and participation in this evening. ", "6. was alleged to have delivered a speech on January 18, 1971 at the foundation laying ceremony of a new post office building at Rae Bareli in the company of Prof. , the Minister, mentioned above. This allegation was not accepted on the ground that it was not supported by any evidence whatsoever. ", "436. All that the witnesses could remember of speech, on each occasion, was that he supported the original respondent's candidature. Out of allegations of acts said to have been committed on 6 occasions by in this period, the learned Judge found only 4 instances proved. Out of these, it was clear that could not have done anything in furtherance of the original respondent's election on January 17, 1971, when, according to the election-petitioner's witnesses, he was not even allowed to speak. Even if all the election-petitioner's witnesses accepted by the learned Judge are to be implicitly believed for this period the position is :(a) On three occasions in this period, from January 14, 1971 to January 25, 1971, is shown to have made a speech supporting the original respondent's candidature. ", "(b) There is no evidence whatsoever from any source that did so on any of these three occasions either after having been requested by the original respondent to do so or with her knowledge or consent or approval. ", "(c) The only evidence in the case, on the decisive question, coming from the side of the original respondent, is that did, whatever he did, entirely on his own initiative and in his private and individual capacity, without the slightest solicitation, request, or suggestion from the original respondent who did not even know what he was doing at Rae Bareli. And, this evidence, being uncontroverted, could not be rejected. In fact, it was not rejected by . It was ignored by it presumably under erroneous belief that it was not material. ", "437. There is no evidence whatsoever that was constructed a sort of general de facto agent of the Prime Minister even before he became her election agent on January 2, 1971. Indeed, such a case, that was constituted a de facto agent of the Prime Minister, and, if so, what was the scope of his authority, was not set up in the petition and was not put in issue. Therefore, there is no finding on it by the learned Judge. Could the then, without any proof of any specific request or solicitation or even knowledge of or consent to the doing of any particular acts may have done in this period make the Prime Minister liable for them in any way? I think not. The election-petitioner had to be confined to the case he had set up. This, as already pointed out, could only be, on a fair reading of the petition on issue No. 1, one of the specific authorisation of particular individual acts of . Of this, there is not only no evidence whatsoever on record but the evidence is to ", "438. Issue No. 1, as framed, and the form of findings given on it indicate that the learned Judge realized that the election-petitioner's case must be confined to proof of specific acts or statements of the original respondent herself which induced , as a government servant, to give some assistance in furtherance of her election, but the discussion of evidence and the inferences which the learned Judge reached upon the circumstances found, indicated that the learned Judge thought that was constituted a sort of de facto agent even before was clothed with legal authority on February 1, 1971. This appears to me to be the underlying current of thought and reasoning of the learned Judge. Thus, the result was that what was really decided was the case of a de facto agency which was neither set up nor was the subject-matter of an issue. I, therefore, think that the principle that no amount of evidence could be looked into on a case not really set up was applicable here. It was quite u ", "439. In Rustom Satin V. Dr. Sampoornand it had been held by a Division Bench of ( and , .), inter alia (at p. 243) \"So far as the election law in this country is concerned it is a creation of statute and as such has to be interpreted in accordance within the provisions of that statute. Section 100 of the Act clearly refers to corrupt practices committed by four classes of persons only viz., the candidate, his election agent, persons acting with the consent of the candidate or his election agent, and those acting without such consent. The corrupt practices committed by the first three classes of persons are covered by Section 100(1) (b), while those committed by persons falling in the fourth class are provided against in Section 100(1) (d) (ii).\" ", "The same Bench of in v. 135 had held (at p. 456) : ", "\"..... even in the case of admitted workers in whose case also general consent to work for the candidate may be implied, the consent of the returned candidate to corrupt practice or practices complained against have to be separately proved, and reliance upon general consent, express or implied, to work legitimately for the candidate is not deemed sufficient.\" ", "440. After January 14, 1971, the Prime Minister, like everyone else concerned, obviously believed that was no longer a government servant. As I have already pointed out, this was the legally correct assumption. Even if one were to assume, for the sake of argument, that this was not so and that the learned Judge had correctly held that 's resignation became effective from January 25, 1971, there could be no liability for a corrupt practice by merely permitting to resign. The uncontroverted evidence is that, after resigning, went to Rae Bareli voluntarily, without any request or suggestion made to him by the original respondent or by anybody else to go to Rae Bareli and work for her election. Even his appointment as the original respondent's election agent on February 1, 1971, according to 's evidence, was the result of suggestion of at Rae Bareli, apparently during the Prime Minister's visit to her constituency. ", "441. Cases in which help rendered voluntarily by a government servant without any attempt by the candidate concerned to \"obtain\" or \"procure\" it were held not to constitute a \"corrupt practice\" of the candidate, whatever be the impropriety of it for the government servant himself, were completely overlooked by the learned Judge. a Division Bench of Allahabad (, and , J.) had pointed out that a government servant has a \"private personality\" too. Similar observations of , J. are found in a Division Bench decision of (see : v. ). ", "442. On the conclusions reached by the learned Judge himself, the acts of between the period January 25, 1971 and February 6, 1971, the date of the publication of the notification, could not be taken into account as no corrupt practice could possibly exist in that period, due to the participation of in any election work. And, with regard to the two earlier periods, beginning with January 7, 1971, I am unable to see, for the reasons given above, how any corrupt practice could be committed by the original respondent vicariously due to anything done by , even if one were to apply the law as it existed before the amendments of the Act. ", "443. Another question, which I may now briefly consider, is the date from which the original respondent could be said to have held herself out as a candidate. If she was not a \"candidate\" upto January 25, 1971, as defined by law, that would, in itself, be a sufficient ground for wiping out the effect of findings of the learned judge on the to periods dealt with above. ", "444. The learned Judge had inferred that the Prime Minister was a \"candidate\" from December 29, 1970 as she had held herself out as a candidate when she answered a question put to her on December 29, 1970 at a press conference at New Delhi. The question and answer were as follows : ", "\"Q. A short while ago there was a meeting of the opposition leaders and there they said that the Prime Minister is changing her constituency from Rae Bareli to Gurgaon? ", "P.M. No. I am not.\" ", "In the witness box, the Prime Minister disclosed that what she meant by the answer was that she would not contest from the Gurgaon constitutency. On further cross-examination, she stated : ", "\"It is wrong to assume that while giving the reply marked 'B' in the transcript (Ext. 132) I conveyed that I was not changing my constituency from Rae Bareli at all and emphatically held out that I would contest election again from Rae Bareli. In my opinion there is no basis for this assumption.\" ", "445. The learned Judge had, in preference to the statement of the Prime Minister herself as to what she meant, together with the evidence given by her Secretariat that there were entreaties or offers to her from other constitutencies that she should be their representative, relied on press reports and what members of other parties thought and did as a result of the above-mentioned statement of the Prime Minister on December 29, 1970. The learned Judge also referred to paragraph (A) of the additional written statement which runs as follows : ", "\"That in fact, there were offers, from other parliamentary constituencies in India, requesting this respondent to stand as a candidate for from those constituencies and a final decision in regard to the constituency was announced by only on January 29, 1971, and she only held herself out as a candidate on filing her nomination at Rae Barli on 1st of February, 1971.\" ", "He had also referred to the visits made by (R) leaders to Rae Bareli, particularly, and and by Prof. . He had not accepted the explanation that they had gone there of their own accord. ", "446. The learned Judge had also considered several English authorities but had noted that the law here was not the same as in England. It had been laid in v. , where it was said : ", "\"In this respect the law in this country makes a significant departure and that departure, in our opinion, again emphasises the application of vital democratic principle, in the light of differing conditions. We may here note, briefly, a feature of the political practice in the United Kingdom, which repeatedly colours and influences the English cases, viz., the fact that there a person is often adopted as a candidate by a political association, without any move on behalf, until a particular stage when the adoption is formalised by his consent\" ", ". ", "447. I an unable to see what bearing the activities of opposition leaders and statements issued by them or press reports, with regards to the candidature of the original respondent. No. 1 from the Rae Bareli constituency, had upon either and interpretation of her own statement of December 29, 1970, or the date on which she made a final decision to stand as a candidate from the Rae Bareli constituency or the communication of that decision by her to her constituency. The material relied upon by the learned Judge consisted of speculation and hearsay coming from persons who were certainly interested in finding out which constituency the Prime Minister, who had a choice of Gurgaon, a constituency much nearer to New Delhi, and, possibly of other constituency as well if she only wanted to change it. Absence of proof of a desire to change the constituency is not proof of a positive \"holding out\". It has been repeatedly laid down in decided cases on the point that what is relevant is not what other people think or sa ", "448. The learned Judge referred to the contents of a speech made by the Prime Minister at Coimbatore in South India, in the early part of January, 1971, castigating one of the tactics of the opposition parties in choosing to oppose her, for purposes of maximum \"mud slinging\". The learned Judge pointed out that the Prime Minister admitted, in her evidence, that she could have said this in her speech at Coimbatore. She was not asked whether this amounted to holding herself out as a candidate from Rae Bareli constituency. If such a question had been asked there is little doubt that she could have explained the statement by the context in which it was made, just as she had given the precise meaning of her statement of December 29, 1970, in the context in which it was made. Apparently, the context of the statement made in early January in Coimbatore was that the opposition parties had chosen a candidate, who, in the opinion of Prime Minister, possessed certain capacity for \"mud slinging\" which oth of March, 1971. Similarly the context of the question of December 29, 1970, put to the Prime Minister at a conference at New Delhi, was that the members of the opposition parties thought that she may be contesting from Gurgaon. In the light of the opposition tactics, which the Prime Minister herself had referred to in her speech at Coimbatore, it was not unlikely that the Prime Minister would have preferred to keep her own intentions about the constituency, from which she would ultimately stand, either a closely guarded secret, or, at least, in a fluid state. In any case, it was not likely that she would announce her own intention very clearly to stand from any particular constituency until it was considered by her or by her political advisers to be politically expedient to do so. Again, it may be that the prospect of such a leader standing from a particular constituency was likely to have a politically exhilarating effect upon the workers or on party activities in that constituency. From such a point of view ", "449. It seems to me that the learned Judge had given an exaggerated importance to what were either not strictly relevant or insignificant matters in preference to what could be and was decisive and unequivocal. I do not think that the answer of the Prime Minister at the Press Conference on December 29, 1970 or the contents of her speech in Coimbatore, in early January 1971, or even a declaration or announcement of on January 29, 1971, assuming that there was such an announcement, could mean that the Prime Minister had herself finally decided to contest from the Rae Bareli constituency and had held herself out as a candidate for this constituency. This holding out had to take place by the Prime Minister herself and not by . Even if the fact of a declaration made by , on January 29, 1971, which is all that the written statement admits, proves that the Prime Minister was chosen by her party for this particular constituency on this date ", "450. The fact that the tour programmes were circulated in advance for the Rae Bareli district, in which the Prime Minister made electioneering speeches, could also not determine what the final declaration of intention by the Prime Minister was going to be in regard to the Rae Bareli constituency. It is not enough that the candidate should have by then formed an intention to stand from a particular constituency. There is a gap between intent and action which has to be filled by proof of either statements or of conduct which amount to unequivocal declarations made to voters in the constituency in order to amount to a \"holding out\" to them. This seems to me to be the clear position in the law as laid down by courts in this country on the meaning of Section 79(b) of the Act. ", "451. It is significant that despite the large number of speeches and statements the Prime Minister must have made throughout the country, in this period, not a single statement made by her could even be cited in which she had said before February 1, 1971, that she was standing as a candidate from the constituency. It is possible, as I have indicated above, that this may be a part of the political game or permissible party tactics so as to keep opposition parties guessing. It seems to me that the learned Judge was overlooking the context, the probabilities, the natural course of events in such a case, the legal and logical relevance and effect of what he thought was decisive, and finally, the importance of the statement of the Prime Minister herself on this question, supported by complete absence of any evidence to show that she had herself made any clear and decisive statement in any speech or conversation which could shake her stand, that her final decision and unequivocal act was the filing of a ", "452. , this Court said (at p. ", "473) : ", "\"When, therefore a question arises under Section 79(b) whether a person had become a candidate at a given point of time, what has to be seen is whether at that time he had clearly and unambiguously declared his intention to stand as a candidate, so that it could be said of him that he held himself out as a prospective candidate. That he has merely formed an intention to stand for election is not sufficient to make him a prospective candidate, because it is of the essence of the matter that he should hold himself out as a prospective candidate\" ", ". ", "453. In v. , a Division Bench of ( and , .) following the decision of this Court in case (supra) said (at p. 463) : ", "\"The determining factor, therefore, is the decision of the candidate himself, not the act of other persons or bodies adopting him as their candidate\" ", ". ", "454. In v. , it was held by a Division Bench of ( & , JJ.) \"(i) that the purchase of the nomination forms and voters lists, could not amount to holding out as a candidate; (ii) the arranging of public meetings by the officials and the respondents's moving about in the constituency on the 15th and 16th could not by themselves amount to a holding out by the respondent as a prospective candidate on those days in the absence of evidence to show that the respondent had utilised those meetings and tours for the purpose of making utterances of an electioneering characters\" ", ". ", "455. In v. , , relying upon the following observations of this Court in case (supra), held that a holding out within the meaning of section 79(b) must be by declaration of the candidate to an elector or to the electorate in a particular constituency and not to others : ", "\"It may be that the holding out which is contemplated by that section is to the constituency; but if it is that has to decide who shall be adopted for election from the concerned constituency, any declaration made to the Committee is, in effect addressed to the constituency through its accredited representative\" ", ". ", "456. The view of the learned Judge appears to me to run counter to the weight of authorities cited above. In any case, if there was any uncertainty at all in the law, it was been removed nu an amendment by Section 7 of Act No. 40 of 1975 so that Section 79(b) reads as follows : ", "\"'Candidate' means a person who has been or claims to have been duly nominated as a candidate at any election\" ", ". ", "457. Learned Counsel for the election-petitioner contended that this amendment read with Section 10 of the Act 40 of 1975, would retrospectively alter the \"rules of the game\" and would be destructive of the concept of free and fair elections, if it means that a person is only a candidate after he has been duly nominated and that he can indulge in any amount of corrupt practices until the day previous to his nomination. ", "458. Even if the present definition is a new one, it cannot be said to be arbitrary. The concept contained in it is found in the English definition which lays down (Halsbury's Laws of England - 3rd Edn., Vol. 14, p. 162) : ", "\".... a candidate in relation to a parliamentary election means a person who is elected to serve in at the election or a person who is nominated as a candidate at the election, or is declared by himself or by others to be a candidate on or after the day of the issue of the writ of the election......\" ", "The English definition is wider but contains, as its first part, the very concept found in our new definition of a \"candidate\". ", "459. Corrupt practices of a candidate cannot go unpunished, whether they are committed before or after he becomes a candidate, when they amount to acts which come within the purview of electoral offences dealt with by Chapter 3, Sections 125 , 126 , 127(A) or Chapter 9A of the Indian Penal Code . Offences such as bribery, for purposes of either inducing persons to vote or not to vote or to stand as candidates, undue influence, and personation, are all dealt with here. These should be sufficient deterrents against perversion of the electoral process by a prospective candidate who wants to adopt corrupt and objectionable means for gaining success at the polls. ", "460. The amendment appears to me to be within the unquestionable powers of to legislate, either prospectively or retrospectively, with regard to election matters. I am unable to see how it is capable of being interpreted as an attack on free and fair elections, which according to the learned Counsel for the election-petitioner, is part of the basic structure of the Constitution. I think it is important to bear in mind that courts cannot take upon themselves the task of laying down what electoral laws should be. The law-makers, assembled in , are presumed to know and understand their business of making laws for the welfare and well-being of the mass people of this country, for the protection of democracy and of free and fair elections, in accordance with the needs of the democratic process, better than courts know and understand these. It is only where a piece of legislation clearly infringes a constitutional provision or indubitably overrides a constitutional purpose or mandate or prohib ", "461. I will now take up issue No. 3 of the first set of issues which, after rejecting the contention that the erection of barricades and the provision of the police force for security purposes by the Government of U. P., during the election tours of the Prime Minister on February 1, 1971 and February 25, 1971 in the constituency, contravened Section 123(7) , the learned Judge held that, neverthless the arrangements made by the District Magistrate of , the Superintendent of Police, , the Executive Engineer, P. W. D. and Engineer, , for constructing rostrums and the supply of power for loudspeakers, on the instructions given by the State Government, was a corrupt practice struck by the provisions of Section 123(7) of the Act. As I have already indicated, by the only evidence relied upon by the learned Judge for this extraordinary finding, after having rejected a similar allegation of a corrupt practice under issue No. 2, on account of provision of the pla \"It has been noticed that the rostrum arrangements are not always properly made because the hosts are sometimes unable to bear the cost. As the security of the Prime Minister is the concern of the State, all arrangements for putting up the rostrum, the barricades etc. at the meeting place, including that of an election meeting, will have to be made by State Government concerned.\" ", "462. had also issued a letter (Ex. A. 21) dated November 19, 1969 inviting the attention of s to Rule 71(6), mentioned above, and directing them to ensure that, whenever rostrums are constructed on such occasions, they should conform to certain specifications laid down with due regard to security considerations. The letter also directed to bill the political party concerned with expenses upto 25% of the cost of the rostrums of Rs. 25000, whichever is less. The letter also directed that extravagance in expenditure should be avoided. ", "463. It was proved by the evidence of (PW 58) the Home Secretary in the Government of Uttar Pradesh, that rostrums and arrangements for barricading are made by the local officials employing contractors for the purpose, under instructions issued by the State Government. The reasoning adopted by the learned Judge, however, was that, as the Prime Minister's office had issued her tour programmes, with the approval of the Prime Minister, the result must be, in the language of the learned Judge himself : ", "\"... the tour programmes carried an implied direction that should also get constructed rostrums and arrange for public address system for the election meetings to be addressed by her on February 1, 1971 and February 25, 1971. It should be presumed that the respondent No. 1, as Prime Minister of this country, and with five years experience of that office behind her in 1971, also knew that the said work was to be done by the officers of .\" ", "464. This meant that the learned Judge was holding the Prime Minister herself responsible for instructing knowing that it will make the necessary arrangements through its servants. The case thus accepted, that the Prime Minister was employing as her agency in procuring the aid of the officers concerned, was neither set up nor put in issue. Apart from this objection, the learned Judge overlooked that the provisions of Section 123(7) were intended to prevent solicitation for aid and not sending of information to in the course of ordinary official business even if the candidate concerned knows that is bound, under the rules, to make the necessary arrangements dictated by the needs of security of the Prime Minister and convenience of the public. ", "465. The view of the learned Judge involves holding that the \"persona\"(a term derived from the concept of the mask worn by Greek actors on the stage in a drama) of a candidate during an election must not only be different from that of the Prime Minister, but also that, when the two capacities are held by the same person, what is due to the occupant of the office of the Prime Minister must be withdrawn when the same person acts as a candidate. On a similar argument, with regard to use of helicopters and aeroplanes, the learned Judge himself had refused to acknowledge what amounts to a separable legal personality of a candidate in the eyes of law. The ground given for this difference between the use of aeroplanes and helicopters by the Prime Minister and the use of rostrums by her was that the former was more connected with the office or capacity of the Prime Minister and that the latter was exclusively meant for her use in the capacity of a candidate. Even if we were to recognize this distinction between the ", "466. I also think that the learned Judge erred in holding that such a case could be one of solicitation of official aid and assistance at all. It is a case in which certain precautions are taken and arrangements made almost \"automatically\", if one may use this word here, by officers of the as a matter of duty towards the office held by a candidate who undoubtedly enjoys certain advantages which an ordinary candidate cannot have. It is as futile to complain of such a distinction made as it is to complain that a candidate possesses certain advantages at an election because of the personal services rendered to the country distinctions achieved by the candidate. Again, there are advantages which attach themselves to a candidate because of that candidate's personal qualities qualification capacities or background. The appurtenances of office or distinctions achieved are, in my opinion, comparable to such personal advantages in so far as they are not enjoyed because they are \"obtained\" or \"procured\". If such ", "467. The learned Judge had mentioned a Division Bench decision of in , where it was laid down : ", "\"We think that the word 'obtain' in Section 123(7) has been used in the essence of the meaning which connotes purpose behind the action of the candidate. The word has not been used in the sub-section in the sense of a mere passive receipt of assistance without the candidate even being conscious of the fact that the assistance has been rendered. In order to bring the case under sub-section (7), it must be shown that the candidate did make some efforts or perform some purposeful act in order to get the assistance.\" ", "468. He had also cited another Division Bench decision of in , that : ", "\"The words 'obtain' or 'procure' or 'abetting or attempting to obtain or procure' any assistance necessary imply some efforts on the part of candidate or his agent. Mere passive receipt of assistance is not contemplated by the section.\" ", "469. I think that the import of such observations was clearly what has been laid down repeatedly by this Court and emphasized by me already - that a means rea as well as an actus reus must be shown, on the evidence on record, before a candidate can be held guilty of a corrupt practice. , this Court held, in dealing with the allegation of corrupt practice under Section 123(4) of the Act, that mens rea was a necessary ingredient of the corrupt practice practice and that the doctrine of constructive knowledge was not applicable here. ", "470. In the case before us, the election-petitioner alleged a wrongfully \"obtained and procured\" assistance due to acts of the original respondent as well as her election agent . Hence, proof of actual mens rea as well as actus reus on the part of either the candidate herself or her election agent had to be given. This was not done. The election petition was, therefore, liable to be rejected on this ground alone. ", "471. If, however, there was any doubt or uncertainty on the matter, the view taken by the learned Judge had, at any rate, directed the attention of to the need for a clarification of the law which became necessary. It is not possible to object to the movies behind the legislation on this ground. could certainly set right a defect in law which may have come to its notice as a result of the learned Judge's interpretation of Section 123(7) . The defect may be due to a possible ambiguity. In order to clarify the law, Section 7 of the Act 40 of 1975 inserted a proviso at the end of Section 123(7) , which runs as follows : ", "\"Provided that where any person, in the service of the Government and belonging to any of the classes aforesaid, in the discharge or purported discharge of his official duty, makes any arrangements or provides any facilities or does any other act or thing, for, to, or in relation to, any candidate or his agent or any other person acting with the consent of the candidate of his election agent, (whether by reason of the office held by the candidate or for any other reason), such arrangements, facilities or act or thing shall not be deemed to be assistance for the furtherance of the prospects of that candidate's election.\" ", "472. The learned Counsel for the election-petitioner has, very fairly, conceded that, if this amendment, which is retrospective by reason of the operation of Section 10 of Act 40 of 1975, is valid, the decision of the learned Judge on the above mentioned issue No. 3 would not sustainable. Such a concession, incidentally, means that whatever facilities were given to the Prime Minister by the construction of rostrums or provision of power for the loudspeakers, for which the party was also billed, at least to the extent of one-fourth of the expenses of the rostrums and wholly as regards the expenses of loudspeakers, were given by the officers concerned in the performance of their official duties. This is not the same thing as \"obtaining\" or \"procuring\" by solicitation. ", "473. Learned Counsel for the election-petitioner has, however, put forward the same objection this retrospective amendment as the one against a change in the definition of \"candidate\". It appears to me that this amendment is merely clarificatory of the state of law as it really was even before the amendment. On the view I take, there is no question here of altering the \"rules of the game\" to the disadvantage of the election-petitioner. The disadvantage, if any, was there already because of the consequences which, I think, legally and naturally flow from the occupation of the high office of the Prime Minister of this country. ", "474. There is no attack on the validity of Section 123(7) of the Act as it existed before the amendment. Hence, there could be no challenge to the validity of the amendment if it does not, as I think it does not, change the law but merely clarifies it. ", "475. Learned Counsel for the election-petitioner contended that, as a candidate at an election, Prime Minister and an ordinary candidate should enjoy equal protection of the laws and should be afforded equal facilities irrespective of the office occupied by one of two or more candidates. Such an attack upon the validity of this amendment seems to me to be possible only under the provisions of Article 14 of the Constitution. But, as Act 40 of 1975 has been placed by Section 5 of the Thirty-ninth Amendment in the protected Ninth Schedule of the Constitution, it becomes immune from such an attack. After the practically unanimous opinion of this Court in case (supra), that such an immunisation of an enactment from an attack based upon an alleged violation of the chapter on fundamental rights is constitutionally valid, I do not think that a similar attack can be brought in through the backdoor of a \"basic structure\" of the Constitution. Moreover, I am unable to see how this particular amendm ", "476. Before I proceed further, I may mention that I have dealt with the findings of the learned Judge, assailed by the original respondent's Appeal No. 887 of 1975, perhaps in greater length and depth, after going through the evidence in the case, than I had set out to do. I have done so for several reasons. Firstly, I think that the nature of the attack upon the bona fides of the amendments made although ordinarily not even entertainable, having been permitted due to the constitutional importance and gravity of the allegations made, this question could not, in my opinion, be satisfactorily dealt with without considering the nature of the findings and the evidence at some length so as to satisfy myself that no such question could possibly arise here. Secondly, if the amendments were made necessary for reasons brought out fully only by dealing with facts and findings in this case, they could not give rise to any grounds to suggest that there was anything wrong in making amendments to remove such reasons. ", "477. It appears to me, as already indicated by me, that the learned Judge was perhaps unduly conscious of the fact that he was dealing with the case of the Prime Minister of this country. He, therefore, as he indicated in his judgment, seemed anxious not to allow this fact to affect his judgment. Nevertheless, when it came to appraising evidence, it seems to me that, as I have already pointed out, he applied unequal standards in assessing its worth so as to largely relieve the election-petitioner of the very heavy onus of proof that lies on a party which challenges the verdict of the electors by allegations of corrupt practices. He also appeared to be attempting to achieve, by means of judicial interpretation, an equalisation of conditions under which in his opinion, candidates should contest elections. I think that it is not the function of courts to embark on attempts to achieve what is only in the power of to accomplish, that is to say, to bring about equality of conditions where the law permit ", "478. As regards appraisal of evidence in such a case, I may point out that, in 146, , J., speaking for this , said : (p. 666) \"An election once held is not be treated in a lighthearted manner and defeated candidates or disgruntled electors should not get away with it by filing election petitions on unsubstantial grounds and irresponsible evidence, thereby, introducing a serious element of uncertainty in the verdict already rendered by the electorate. An election is a politically scared public act, not of one person or of one official, but of the collective will of the whole constituency. s naturally must respect this public expression secretly written and show extreme reluctance to set aside or declare void an election which has already been held unless clear and cogent testimony compelling the to uphold the corrupt practice alleged against the returned candidate is adduced. Indeed, election petitions were corrupt practices are imputed must be regarded as proceedings of a quasi-criminal nature wherein strict proof is necessary. The burden is therefore heavy on him who assails an election which are concluded.\"This also said there (at p. 672) : ", "\" We regard it as extremely unsafe, in the present climate of Kilkennycat election competitions and partisan witnesses wearing robes of veracity, to upturn a hard won electoral victory merely because lip service to a corrupt practice has been rendered by some sanctimonious witnesses. This Court must look for serious assurance, unlying circumstances or unimpeachable documents to uphold grave charges of corrupt practices which might not merely cancel the election result, but extinguish many a man's public life\" ", ". ", "479. I will now take up the election-petitioner's Cross Appeal No. 909/75. Learned Counsel for the election-petitioner, very properly and frankly, conceded that he could not successfully assail the findings of the learned Judge on issues Nos. 4 and 7 relating to alleged distribution of quilts, blankets, dhotis, and liquor by workers of the original respondent or the alleged provision of free conveyance by vehicles said to have been hired by . The evidence on these questions given the election-petitioner was too flimsy and extravagant and was met by overwhelming evidence to the contrary given by respectable residents of localities in which the alleged corrupt practices are said to have taken place. No driver of any conveyance was produced. Nor was any person produced who had actually received any alleged gift or had consumed anything provided on behalf of the successful candidate. ", "480. As regards issue No. 2, relating to the use of aeroplanes and helicopters by the original respondent, which was not separately pressed evidently because it was covered by the amendment which was assailed by the election-petitioner, the reasons I have given on issue No. 3 for upholding the validity of the amendment relating to the services rendered by government officials and members of defence forces in due discharge of their duties are enough to cover the points raised. ", "481. As regards issue No. 6, relating to the adoption of the drawing of a cow and calf as the symbol of the (R) party of the original respondent, the finding of the trial court, based on a large number of authorities, was that this is not a religious symbol. This question was directly decided in : ; v. decided by on July 21, 1971 and Sri. v. 149, decided on August 27, 1971, by . The learned Judge also cited the following cases where it was decided that a cow is not a religious symbol : v. , v. , v. , v. , , , , Vishwanath Pd. v. , v. . ", "482. In addition, Section 8 of the Act 40 of 1975 has made the position on this point also very clear by providing that, in Section 123 of the Act in clause (3), the following proviso shall be inserted at the end : ", "\"Provided that no symbol allotted under this Act to a candidate shall be deemed to be a religious symbol or a national symbol for the purposes of this clause.\" ", "483. As in the case of other amendments, the amendment was also challenged on behalf of the election-petitioner on the ground that it could be misused. I am afraid that attacks made on such sweeping suggestions of likelihood of misuse, in future, cannot possibly succeed. It has been repeatedly laid down by this Court that the possibility of misuse of a power given by a statue cannot invalidate the provision conferring the power. (See : ; ; ; ; ; ). The occasion to complain can only arise when there is such alleged misuse. Even the possibility of such misuse of this power by so responsible an official as the Election Commissioner cannot be easily conceived of. ", "484. It was submitted that the Election Commissioner's decision on this question was unreasonable. The best class of evidence as to what is and what is not to be reasonably regarded as religious symbol, according to the customs, mores, traditions, and outlook of the people of a country at a certain time consists of contemporaneous decisions of courts. It is useless to quote passages from ancient text about the sacredness of the cow in support of the use of the cow as a religious symbol today. The use of pictures of this excellent and useful animal is so frequently made today for commercial purposes or purposes other than religious that the representation of a cow and a calf cannot, except in some special and purely religious contexts, be held to have religious significance. I, therefore, see no force at all in this submission of the election- petitioner. ", "485. The only question argued with some seriousness in the election- petitioner's appeal was that the election expenses, which form the subject- matter of issue No. 9, had exceeded the limit of authorised expenditure imposed by Section 77 of the Act read with Rule 90. On this issue, the learned Judge had considered every allegedly omitted item of expense very thoroughly and had reached the conclusion that the following 3 items, totaling upto Rs. 18, 183.50, had to be added to the return of election expenses of the original respondent which mentioned items totaling upto Rs. 12, 892.97. These were : (1) Cost of rostrums Rs. 16, 000; (2) Cost of installation of loudspeakers Rs. 1, 951; (3) Cost of providing transport for one journey by car Rs. 232.50. ", "486. On this issue, the learned Judge's appreciation of evidence was not only very thorough and correct, but the application of the governing law on the subject also appears to me to be faultless. Ordinarily, we do not, sitting even in first appeals on question of law as well as of fact in election cases, go into findings of fact arrived at without misapplication of law or errors of approach to evidence. In the case before us, two main questions and one subsidiary question, each of which is a mixed question of fact and law, which deserve consideration by the on this issue, have been raised before us. I will deal with these questions briefly seriatim. ", "487. The first question is : If the party, which a candidate represents, spends or others also spend some money on his or her election, is this expenditure one which can be or should be properly included in the statement of election expenses submitted by the candidate? Arguments before us have proceeded on the assumption made by both sides that some expenditure was incurred by (R) party and some expenditure must also have been incurred by those who either voluntarily helped or even thrust their supposed assistance, whether it was helpful or not, upon those managing the original respondent's election, which was not shown as part of her election expenses. Is the successful candidate bound, under the law, to show this also as part of election expenses? ", "488. The question assumed special importance after the decision of this Court in , where a Division Bench of this Court observed : (SCC p. 656, para 11) \"Now, if a candidate were to be subject to the limitation of the ceiling, but the political party sponsoring him or his friends and supporters were to be free to spend as much as they like in connection with his election, the object of imposing the ceiling would be completely frustrated and the beneficent provision enacted in the interest of purity and genuineness of the democratic process would be wholly emasculated. The mischeif sought to be remedied and the evil sought to be suppressed would enter the political arena with redoubled force and vitiate the political life of the country. The great democratic ideal of social, economic and political justice and equality of status and opportunity enshrined in the Preamble of our Constitution would remain merely a distant dream eluding our grasp. The legislators could never have intended that what the individual a candidate cannot do, the political party sponsoring him or his friends and supporters should be free to do. That is why the legislators wisely interdic ", "489. After making the above-mentioned observations, the apparently broad sweep of the observations was limited as follows : (SCC p. 656, para 11).\" ", "It may be contended that this would considerably inhibit the electoral campaign of political parties but we do not think so. In the first place, a political party is free to incur any expenditure it likes on its general party propaganda though, of course, in this area also some limitative ceiling is eminently desirable coupled with filing of return of expenses and an independent machinery to investigate and take action. It is only where expenditure is incurred which can be identified with the election of a given candidate that it would be liable to be added to the expenditure of that candidate as being impliedly authorised by him. Secondly, if there is continuous community involvement in political administration punctuated by activated phases of well-discussed choice of candidates by popular participation in the process of nomination, much of unnecessary expenditure which is incurred today could be avoided. ", "\"490. It is not necessary to quote further from the judgment which suggested taking of steps for reform of electoral machinery so as to ensure \"choice of candidates by popular participation in the process of nomination\", because that would take us into a territory beyond mere interpretation of the law as it exists. It is clear from the passages cited and later parts of the judgment that the earlier decision of this Court, requiring proof of authorisation by the candidate of the election expenditure for which he could be held responsible, and, in particular, , which I shall refer to again a little later, are considered. It is enough to observe that the passages quoted above rest on the assumption that, where there are special circumstances in a case which constitute a political party an implied agent of the candidate himself, the candidate will be responsible. It was also suggested there that a political party itself must exercise some control over the expenses of the candidate ", "491. The difficulty which faces the election-petitioner at the outset in taking up a case of implied authorisation, on the strength of anything observed or decided by this Court in case (supra), is that no such case was set up here. The petition does not say that the local (R) party was really an express or implied agent of the original respondent or that it had acted in a manner from which it could be inferred that the funds were really being supplied by the original respondent and were merely being spent by the party or its workers for the election under consideration. No facts or circumstances were at all indicated either in the petition or in evidence from which such inference were possible. On the other hand, what is sought to be pointed out now in the case before us is that a sum of Rs. 70, 000 was shown to have been received from some undisclosed sources by , the President of District Committee at Rae Bareli, and that a large part of it was show ", "492. It is true that the case set up is that the prescribed limit of expenditure was exceeded and the case is so stated that items beyond the list could conceivably be added. Nevertheless, unless and until there is a plea that something was spent by the (R) party, either as an express or implied agent of the original respondent, this loophole left in the petition would not suffice. Section 83(1) (b) of the Act contains the mandatory provisions that the petition\" ", "shall set forth full particulars of any corrupt practice that the petitioner alleges, including as full a statement as possible of the names of parties alleged to have committed such corrupt practice and the date and place of the commission of each such practice. ", "\"493. The judgment of this Court in case (supra) discusses a number of cases decided by this Court which show that it is not enough to prove expenditure of money by a candidate's party or friends or relation. It must be also proved that this was expenditure authorised by the candidate and incurred as the candidate's express or implied agent. These cases were : ; ; and . ", "494. After examining this catena of cases, I think, with great respect, that the decision of this Court in case (supra) could be understood to point in a direction contrary to that in which the previous cases were decided. Hence, it appears to me that the amendment made by Act 58 of 1974, by adding the explanation (1) to Section 77(1) of the Act, could be justified as merely an attempt to restore the law as it had been understood to be previous to decision of this Court in case (supra).\" ", "Explanation 1. Notwithstanding any judgment, order or decision of any court to the contrary, any expenditure incurred or authorised in connection with the election of a candidate by a political party or by any other association or body of persons or by any individual (other than the candidate or his election agent) shall not be deemed to be, and shall not ever be deemed to have been, expenditure in connection with the election incurred or authorized by the candidate or by his election agent for the purposes of this sub-section : ", "Provided that nothing contained in this Explanation shall effect. ", "(a) any judgment, order or decision of whereby the election of a candidate to or to has been declared void or set aside before the commencement of the Representation of the People (Amendment) Ordinance, 1974; ", "(b) any judgment, order or decision of whereby the election of any such candidate has been declared void or set aside before the commencement of the said Ordinance if no appeal has been preferred to against such judgment, order or decision of before such commencement and the period of limitation for filing such appeal has expired before such commencement \". ", "495. It appears to me that both parties to the case now before us were under the impression that the expenses incurred by a political party over its candidate's election was outside the prescribed limit which operated only against expenditure by a candidate himself. Hence, the petitioner had not pleaded expenses incurred by the party of the original respondent as expenses authorised by the original respondent. The test of authorisation would naturally be the creation of a liability to reimburse whoever spends the money and not necessarily the provision of money beforehand by the candidate on whose behalf it is spent. Nevertheless, the authorisation has to be set up and proved. In the written statement filed on behalf on the original respondent, it was very frankly admitted that some expenditure, incurred by the local party itself, had not been shown as election expenses of the candidate herself. This was the position because, on the side of the original respondent also, the law was understood to be ", "496. The second question which arises for consideration is : if some expenses are shown or admitted to have been incurred by the candidate's party or third persons over the election of the successful candidate, is it possible to separate it from a total expenditure on more than one constituency by some process of estimation and apportionment? Of course, this question can only arise if it is first proved that whatever expenditure was incurred by candidate's party or by some other person, who may be a friend, a relation, or a sympathiser, was incurred in circumstances from which it can be inferred that the successful candidate would reimburse the party or person who incurred it. As I have already held, it is only then that expenditure could be held to be authorised by the candidate. It is not enough that some advantage accrued or expenditure was incurred within the knowledge of the candidate. This was very clearly brought out in (supra). In this case, the Manager, Assistant Ma ", "497. An attempt was then made to pass the responsibility on to the original respondent for the expenses of at least 23 vehicles whose numbers are mentioned in a letter dated February 25, 1971, written by , who was then the original respondent's election agent, and sent to the District Officer, , stating as follows :\" ", "Sir, I beg to say that , Rae Bareli has taken the following cars for election purposes in the three parliamentary constituencies, Rae Bareli, Amethi and Ram Sanehi Ghat. You may, therefore kindly release them.\" ", "After giving numbers of the vehicles the letter proceeds : ", "\" It is therefore requested that the abovesaid cars may kindly be released without delay. The letter of the President of about the abovesaid cars is enclosed herewith \". ", "The letter of the President of the committee, mentioned by , was a rather urgent request made to him by , on February 24, 1971 (Ex. A-43), after informing him that he is in difficulties as he had tried to find out unsuccessfully the whereabouts of , who was contesting election from Amethi parliamentary constituency, and of , who was contesting the election from Ram Sanehi parliamentary constituency. He, therefore asked , the election agent of the original respondent, to send a letter to the District Officer, who had refused to released the vehicles without the endorsement of the candidate concerned or his her election agent. ", "498. It is clear from the above-mentioned correspondence that was not speaking on behalf of the other two candidates of adjoining parliamentary constituencies. He was not even undertaking to pay anything for the use of the vehicles on behalf of the original respondent. also did not state that these vehicles were needed for work in the original respondent's constituency. He merely forwarded the letter with a request for compliance with what wanted. was concerned and entrusted with conducting electioneering work in three adjoining parliamentary constituencies successfully. He had, therefore made a frantic appeal to to come to his help. , without concealing any fact, had sent this very letter with a request for the release of the vehicles to the District Officer concerned. On this evidence, the learned Judge came to the conclusion that it was not possible to say which constituency. The learned Judge after considering the evidenc ", "499. In v. Pt. this Court in a similar situation said :\" ", "Whichever way one looks at the matter it is quite clear in view of the decision of this Court reported in (supra) that the expenditure must be by the candidate himself and any expenditure in his interest by others (not his agents within the meaning of the a term in the election law) is not to be taken note of. Here the hiring was by which was not such an agent and therefore the amount spent by cannot be taken as an amount which must compulsorily be included in the expenditure over the election by a candidate. If this be the position, we have to decide whether this amount spent on the jeeps must be taken to be an expenditure made by the candidate himself. Of that there is no evidence. The bill stands in the name of and was presumably paid by also. The evidence, however, is that this jeep was used on behalf of the returned candidate and to that extent we subscribe to the finding given ", "500. In v. 172, this Court held : ", "\"It is now well settled that expenses incurred by a political party in support of its candidates do not come within the mischief of Section 123(6) read with Section 77 of the Act\" ", ". ", "501. , this Court pointed out : ", "\"In India all corrupt practices stand on the same footing. The only difference made is that when consent is proved on the part of the candidate or his election agent to the commission of corrupt practice, that itself is sufficient. When a corrupt practice is committed by an agent and there is no such consent then the petitioner must go further and prove that the result of the election in so far as the returned candidate is concerned was materially affected\" ", ". ", "502. However, as I have already held, there is no case or evidence before us that the party was the agent, express or implied, of the original respondent or acting as the channel through which any money whatsoever was spent by the original respondent. The petition could not possibly succeed on the ground of exceeding election expenses. On the other hand, on the findings given by me above, the expenses on the construction of rostrums were also erroneously added by the learned Judge. In fact, it seems that other two items mentioned there were also wrongly added. Expenses of the installation and use of loudspeakers and the power supplied were certainly shown to have been borne by the party itself. It is true that when elections of persons in the position of the Prime Minister or even of ministers, whether in or a State Government, take place, a number of people come forward to either give or thrust their supposed aid in the election. It may be impossible for the candidate ", "503. The third and the last and a subsidiary submission on behalf of the election-petitioner, on election expenses, was that, not having been produced by the original respondent, some sort of presumption arises against the original respondent. I do not think that it is possible to shift a burden of the petitioner on to the original respondent whose case never was that spent any money on her behalf. The case of v. was relied upon to submit that a presumption may arise against a successful candidate from the non-production of available evidence to support his version. Such a presumption, under Section 114 Evidence Act, it has to be remembered, is always optional and one of fact, depending upon the whole set of facts. It is not obligatory. ", "504. In case (supra), the evidence seemed to have resulted in a prima facie case whose effect the respondent had to get rid of. In the case before us, the election-petitioner had summoned (PW 59), the Secretary of , who appeared with account books of the party of . The election-petitioner could get nothing useful out of his evidence. Even if the election- petitioner did not, for some reason, desire to summon similarly, his Counsel could have requested the court to exercise its discretionary powers under Order XVI, Rule 14 C. P. C., but this was never done. A presumption could not arise on the facts and circumstances of a case in which it could not be said that 's evidence was necessary to discharge some burden of the original respondent. The original respondent and discharged whatever onus lay upon her by producing her own election agent , who had kept her accounts. And, she had h ", "505. I may now very shortly deal with the objection that, as a number of members of belonging to the opposition parties were in detention, under the preventive detention laws, which could not be questioned before courts of law, because of the declaration of the emergency by the President, there was a procedural defect in making the amendments of the Act of 1951 and the Thirty-ninth Constitutional Amendment. ", "506. Article 122 of the Constitution prevents this Court from going into any question relating to irregularity of proceedings \"in \". It reads as follows : ", "\"122. (1) The validity of any proceedings in shall not be called in question on the ground of any alleged irregularity of procedure. ", "(2) No officer or member of in whom powers are vested by or under this Constitution for regulating procedure or the conduct of business, or for maintaining order in shall be subject to the jurisdiction of any Court in respect of the exercise by him of those powers\" ", ". ", "507. What is alleged by the election-petitioner is that the opposition members of , who had been detained under the preventive detention laws, were entitled to get notice of the proposed enactments and the Thirty-ninth Amendment, so as to be present \"in \", to oppose these changes in the law. I am afraid, such an objection is directly covered by the terms of Article 122 which bears every court from examining the propriety of proceedings \"in parliament\". If any privileges of members of were involved, it was open to them to have the question raised \"in \". There is no provision of the Constitution which has been pointed out to us providing for any notice to us providing for any notice to each member of . That, I think, is also a matter completely covered by Article 122 of the Constitution. All that this Court can look into, in appropriate cases, is whether the procedure which amounts to legislation or, in the case of a constitutional amendment, which is prescrib ", "508. Again, this Court has held, in , that a notice issued by the Speaker of a for the breach of its privilege cannot be questioned on the ground that the rules of procedure relating to proceedings for breach of privilege have not been observed. All these are internal matters of procedure which the Houses of Parliament themselves regulate. ", "509. As regards the validity of the detentions of the members of , that cannot be questioned automatically or on the bare statement by Counsel that certain members of are illegally detained with some ulterior object. The enforcement of fundamental rights in regulated by Articles 32 and 226 of the Constitution and the suspension of remedies under these articles is also governed by appropriate constitutional provisions. Their legality and regularity cannot be collateral assailed by mere assertions made by Counsel before us. I therefore, overrule these objections to the validity of the amendments and the Thirty-ninth Amendment as we cannot even entertain them in this manner in these proceedings. ", "510. I will now turn to the validity of clause (4) of Article 329A sought to be added by Section 4 of the Thirty-ninth Amendment. I will quote the whole of Section 4 as some argument was advanced on the context in which clause (4) of Article 329A occurs. Section 4 reads as follows : ", "\"4. In Part XV of the Constitution, after Article 329 , the following article shall be inserted, namely :-\" ", "329A. (1) Subject to the provisions of Chapter II of Part V [except sub- clause (e) of clause (1) of Article 102 ], no election - ", "(a) to either House of Parliament of a person who holds the office of Prime Minister at the time of such election or is appointed as Prime Minister at the time of such election or is appointed as Prime Minister after such election; ", "(b) to of a person who holds the office of speaker of that at the time of such election or who is chosen as the Speaker for that after such election; ", "shall be called in question, except before such authority [not being any such authority as is referred to in clause (b) of Article 329] or body and in such manner as may be provided for by or under any law made by and any such law may provide for all other matters relating to doubts and disputes in relation to such election including the grounds on which such election may be questioned. ", "(2) The validity of any such law as is referred to in clause (1) and the decision of any authority or body under such law shall not be called in question in any court. ", "(3) Where any person is appointed as Prime Minister or, as the case may be, chosen to the office of the Speaker of , while an election petition referred to in clause (b) of Article 329 in respect of his election to either House of or, as the case may be, to is pending, such election petition shall abate upon such person being appointed as Prime Minister or, as the case may be, being chosen to the office of the Speaker of , but such election may be called in question under any such law as is referred to in clause (1).(4) No law made by before the commencement of the Constitution (Thirty-ninth Amendment) Act, in so far as it relates to election petitions and matters connected therewith, as it relates to election petition and matters connected therewith, shall apply or shall be deemed ever to have applied to or in relation to the election of any such person as is referred to in clause (1) to either House of and such election shall not be deemed to be void or ever to have become void on any ground on which such election could be declared to be void or has, before such commencement, been declared to be void under any such law and notwithstanding any order made by any court, before such commencement, declaring such election to be void, such order and any finding on which such order is based shall be and shall be deemed always to have been void and of no effect. ", "(5) Any appeal or cross appeal against any such order of any court as referred to in clause (4) pending immediately before the commencement of the Constitution (Thirty-ninth Amendment) Act, before shall be disposed of in conformity with the provisions of clause (4). ", "(6) The provisions of this article shall have effect notwithstanding anything contained in this Constitution. ", "\"511. Counsel for both sides are agreed that, for the purpose of the case before us, we need not consider the constitutional validity of clauses (1) to (3) of the newly introduced Article 329A of the Constitution. I will therefore, concern myself only with the constitutional validity of a clause (4) of Article 329A of the Constitution. ", "512. Learned Counsel for the election-petitioner contended that the constituent or amending power contained in Article 368 of our Constitution had been misused to achieve some purpose which was either outside the article or which struck at the roots of the \"basic structure\" or \"the essential features\" of our Constitution. It was submitted that the amendment is invalid on an application of tests laid down by a majority of the 13 Judges who indicated certain basic and inviolable principles of our Constitution in case (supra). It was contended that the newly added Article 329A of the Constitution, far from constituting a constitutional law, which alone could be made under Article 368 , did not even satisfy the tests of a law, inasmuch as it did not lay down any general rule applicable to all cases of a particular class but was really designed to decide one particular election case, which is now before us for hearing, in a particular way. According to learned Counsel, the amending bodies had ", "513. All the contentions of learned Counsel for the election-petitioners, apart from the alleged procedural defect in amending the Act of 1951 and the Constitution when a number of opposition members of are detained under the preventive detention was, already dealt with by me, seemed directed towards producing two results either simultaneously or alternatively : firstly, to persuade us to hold that the constituent power had been exceeded or sought to be utilised for extraneous purposes falling outside the purview of Article 368 of the Constitution altogether; and, secondly, to convince us that the effects of the fourth clause of Article 329A must be such that, if this purported addition to our Constitution was upheld, the \"basic structure\" or the \"basic features\" or \"the underlying principles\" of our Constitution will be irreparably damaged so that it could not any longer be looked upon as the same Constitution. It was submitted that the majority view in case (supra), which w ", "514. We have heard the learned Attorney General and the learned Solicitor General of India, in defence of the fourth clause of Article 329A sought to be added by the Thirty-ninth Amendment, as well as Mr. and Mr. , learned Counsel for the original respondent, who also supported the validity of the impugned clause. The first contention of the learned Counsel seemed directed towards inducing us not to look beyond the language to discover the purposes or the nature of the function performed in passing clause (4) of Article 329 or its effects. This contention had necessarily to rest upon the assumption that provisions of clauses (4) and (5) and (6) of Article 329 A, sought to be introduced by the Thirty-ninth Amendment, were valid and had the effect of depriving this of jurisdiction to determine the validity of clause (4) by exploring the purposes and objects which may lie behind the plain meaning of clause (4). Our difficulty, however, is that even an attempt to give its natural ", "515. In the circumstances of this case, set out above, the findings on contested questions of fact and law and the order indicated by clause (4) could only be those contained in the he judgment under appeal by both sides before us. The language of clause (4) was, according to the submissions of learned Counsel supporting the amendment, itself meant to convey that, after going into the disputed questions of fact, the constituent bodies had reached the conclusion that the order and the findings must have no legal effect. Indeed the Solicitor-General went so far as to submit that must be deemed to be aware of the contents of the whole record of the proceedings in including the pleadings, the evidence, and the findings in the judgment of , as these were all available to it. In other words, we must imagine and suppose that, whatever may be the actual position had sat in judgment over the whole case as a court of appeal would have done. But the impugned clause (4) ", "516. At the same time, it was contended, and this was especially emphasised by Mr. , that and the ratifying of the States - participating in the Constitution-making process - had not applied any pre-existing norms but had merely declared and registered, almost automatically, without any need to consider anything further or to apply any law whatsoever to any facts, what followed from the abrogation of all pre-existing law, with its procedure and norms, so far as the election- petition against the original respondent was concerned. This meant that the constituent bodies, proceeding on the assumption that had rightly held the original respondent's election to be invalid by applying the provisions of the 1951 Act, had considered it necessary to validate what really was invalid according to the 1951 Act. In view of what I have already held on merits, such an assumption, if it was there at all, could only be based on a misconception. ", "517. The conflicting points of view, advanced in support of the amendment, enabled the election-petitioner's Counsel to find support for his contention that the impugned clause (4) obviously meant that a considered judgment on, inter alia, disputed question of fact, however erroneous, had been swept aside, quite unceremoniously mechanically, and, without a semblance of a quasi-judicial procedure by a purported exercise of constituent power by the constituent bodies, consisting of the two and the ratifying Legislatures of the various States. He urged that the alternative contentions of Mr. constituted an admission that no procedure whatsoever, which could be considered either reasonable or appropriate for a judicial or quasi-judicial determination of any question of fact or law was followed. He contended that whichever of the two alternative contentions of counsel supporting the Thirty-ninth Amendment was accepted by us, his submission, that the amendment was ultra vires, arbitrar ", "518. The essence of judicial or quasi-judicial function is the application of a law which is already given by the law-making authority to the judicial or quasi-judicial authority to apply. This law has to be applied to certain findings after determining the disputed question of fact in a manner which must confirm to the canons of natural justice. Learned Counsel for the election-petitioner contended that it was not necessary to go beyond clause (4) to reach the conclusion that what was being done was to decide a dispute which could, under the law as it existed till then, only be judicial determinated in the mode prescribed by Article 329(b) read with the Act of 1951 which could not be circumvented even before Article 329A engrafted exceptions on it and the Act of 1951 had been repealed retrospectively in its application to the Prime Minister. The result of a sort of consolidated legislative-cum-adjudicator function was sought to embodied in Article 329A (4) by purported constitutional amendment. He contended ", "519. Learned Counsel supporting the Thirty-ninth Amendment, had, in defence of the amendment, advanced arguments which go beyond the position which was adopted to support the amendments considered by us in case (supra). The new argument now advanced to use the language of the Solicitor General in his last written submissions, is that the power of amendment under Article 368 is\" ", "the very original power of the people which is unbroken into the legislative and the executive and the judicial \". He submitted that the implied limitations, to which the majority decision in case (supra) has committed this for the time being, are no longer available when considering the \"unbroken\" power. Mr. , learned Counsel for the original respondent, puts this very argument in the following words in his written submissions :\" ", "In the hands of the constituent authority there is no demarcation of powers. But the demarcation emerges only when it leaves the hands of the constituent authority through well defined channels into demarcated pools. The constituent power is independent of the fetters or limitations imposed by separation of powers in the hands of the organs of the amongst whom the supreme authority of the is allocated. ", "The constituent power is independent of the doctrine of separation of powers. Separation of powers is when the Constitution is framed laying down the distribution of the powers in the different organs such as the legislative, executive and the judicial power. The constituent power springs as the fountainhead and partakes of sovereignty and is the power which creates the organ and distributes the powers. Therefore, in a sense the constituent power is all-embracing and is at once judicial, executive and legislative, or in a sense super power The constituent power can also change the system of checks and balances upon which the separation of powers is based. ", "\"520. The theory advanced before us may have been designed to escape the logical consequences of the majority view in case (supra) which we cannot, sitting as a bench of five Judges in this , overrule. The theory is, however, quite novel and has to be, I think dealt with by us. It postulates an undifferentiated or amorphous amalgam of bare power constituting the \"constituent power\". According to this theory, the power which constitutes does not need to be either constituted or prevented from exercising a power assigned by it already to a constituted authority. Hence, it is a power of a kind which is above the Constitution itself. If I am not mistaken, the learned Solicitor General did say the constituent power lies \"outside\" the Constitution. In other words, it is independent and above the Constitution itself because it pirates on the Constitution and can displace it with, so to say, one stroke of its exercise. I do not think that such an extreme theory could be supported by the cit ", "521. If we were to accept the theory indicated above, it would make it unnecessary to have a Constitution beyond one consisting of a single sentence laying down that every kind of power is vested in the constituent bodies which may, by means of a single consolidated order or declaration of law, exercise any or all of them themselves whenever they please whether such powers be executive, legislative, or judicial. Could this be the ambit of \"constituent power\" in our Constitution? Would such a view not defeat the whole purpose of a Constitution? Does the whole Constitution so crumble and melt in the crucible of constituent power that its part cannot be made out? Before we could accept a view which carries such drastic implications with it we will have to overrule the majority view in case (supra). The majority view in that case, which is binding upon us, seemed to be that both the supremacy of the Constitution and separation of powers are parts of the basic structure of the Constitution. ", "522. If \"constituent power\", by itself, is so transcendental and exceptional as to be above the provisions of the Constitution itself, it should not, logically speaking, be bound even by the procedure of amendment prescribed by Article 368(2). I have not found any opinion expressed so far by any learned Judge of this Court to show that the constituent power is not bound by the need to follow the procedure laid down in Article 368(2) of the Constitution. Indeed, rather inconsistently with the theory of an absolute and unquestionable power in some undifferentiated or raw and unfettered form, operating from above and outside the Constitution, learned Counsel, supporting the impugned fourth clause in Article 329A , concede that the constituent power is bound by the appropriate procedure laid down in Article 368 for the amendment of the Constitution. What they urge is that, subject to this procedure, which has been followed here, the constituent power cannot be questioned because it is a \"sovereign power\". The log ", "523. I think that the possibly theoretical question indicated above, whatever may be the object of raising it, does deserve to be seriously considered and answered by us because it discloses a basic misconception. Therefore, I propose to consider it at a length which seems to me to be justified by our need to clarify our thinking on a basic or \"key\" concept without a final commitment to a particular view on it. Clearer thinking, by examining a basic theoretical question from every conceivable angle, leads, I believe, to that openmindness which is needed by lawyers no less than by any other class today so that we may, contrary to our reputation, be responsive to the inevitable challenges of change. Justice once said :\" ", "Theory is the most important part of the dogma of law, as the architect is the most important man who takes part in the building of a house. ", "\"[Holmes Collected Papers, (1921) p. 200]. ", "524. It seems to me that the words \"sovereignty\" and \"sovereign power\", used repeatedly learned Counsel defending the Thirty-ninth Amendment to describe the constituent power, should, for several good reasons, be avoided, so far as possible, by lawyers who seek that clarity of thought for which precision in language is the first requirement. One of these reasons was given by Lord Bryce [Studies in \"History and Jurisprudence\"(1901) (pp. 503-504] :\" ", "The frontier districts, if one may call them so, of Ethics, of Law and of political science have been thus infested by a number of vague or ambiguous terms which have produced many barren discussions and caused much needless trouble to students....... No offender of this kind has given more trouble than the so-called 'Doctrine of Sovereignty'\". ", "Prof. , however, opined : ", "\" But this very fact is proof of its vital importance in our modern world, and the wide variety of the views held concerning its essence, as well as the conflicting conclusions to which these views still lead, may furnish sufficient excuse for another attempt to clarify some of our ideas touching this central formula under which we try to rationalize the complicated facts of our modern political life. ", "\"Another reason for eschewing such expressions, so far as possible, is that they are \"emotive\" or of a kind about which Mr. , (writing on \"Key Concepts in Political Science\" Series, at p. 7) rightly observed.\" ", "Emotive words such as 'equality', 'dictatorship', 'elite' or even 'power' can often, by the very passions which they raise, obscure a proper understanding of the sense in which they are, or should be, or should not be, or have been used. regarded the 'rectification of names' as the first task of government.'If names are not correct, language will not be in accordance with the truth of things', and this in time would lead to the end of justice, to anarchy and to war. ", "\"At any rate, in America, the concept of State sovereignty, ranged against that of national sovereignty, did produce a civil was which is said to have been precipitated by the decision of in v. 179. ", "525. I must preface my observation here about the concept of \"sovereignty\" and exercise of \"sovereign power\", between which I make a distinction, with two kinds of explanation. The first kind involves an exposition of a functional or sociological point of view. I believe that every social, political, economic, or legal concept or doctrine must answer the needs of the people of a country at a particular time. I see the development of concepts, doctrines, and institutions as responses to the changing needs of society in every country. They have a function to fulfill in relation to national needs. The second type of explanation may be called historical or meant merely to indicate and illustrate notions or concepts put forward by thinkers at various times in various countries so as to appropriately relate them to what we may find today under our Constitution. We have to appreciate the chronology or stages of their development if we are to avoid trying to fit into our Constitution something which has no real rele ", "526. I certainly do not think that Judges of this have or should think that they have the power to consciously alter, under the guise of judicial interpretation, what the Constitution declares or necessarily implies even though our pronouncements, interpreting the Constitution, may have the effect of contributing something to the growth or even change of Constitutional Law by clearing doubts, removing uncertainties, or filling up of gaps to a limited extent. If the law embodied in our Constitution, as declared by this , is not satisfactory, I do not think that we can or should even attempt to stand in the way of a change of any kind sought through appropriate constitutional means by the constitutionally appointed organs and agencies of the . If, however, this is asked to declare as valid what seems to it to fall clearly outside the ambit of the Constitution, and, indeed, what is even claimed to be operating from outside the Constitution and described as a supra-constitutional power, the ", "527. The term \"sovereign\" is derived from the Latin word \"Superanus\" which was akin to \"Suzerian\" suggesting a hierarchy of classes which characterised ancient and medieval societies. In its origin, it is an attribute assigned to the highest living human superiors in the political hierarchy and not some abstract quality of a principle or of a law contained in a document - a meaning, as will be shown here, which emerges clearly later. In times of anarchic disorder or oppression, by local satraps or chieftains or barons or even bullies and criminals, ordinary mortals have sought the protection of those who could give it because of their superior physical might. No book or document could provide them with the kind of help they needed. They looked up to their \"Sovereign liege and Lord\", as the medieval monarch was addressed by his subjects, for protection against every kind of tyranny and oppression. ", "528. The Greeks and Romans were not troubled by theories of \"sovereignty\" in a State. The principle that Might was Right was recognised as the unquestioned legally operative principle at least in the field of their constitutional laws. Greek philosophers had, however, formulated a theory of a Law of Nature which was, morally, above the laws actually enforced. In later stages of Roman law, Roman jurists also, saturated with Greek notions of an ethically superior law of nature, said that the institution of slavery, which gave the owner of a slave theoretically absolute powers of life and death over the slave, just like the powers of a pater-familia over his children, was contrary to just natural although it was recognised by jus gentium, the laws of then civilised world. , in his analysis of forms of government, had emphasized the importance of the Constitution of a State as a test or determinant of sovereign power in the State. And, Roman jurists had, indirectly, cleared the path for the rise of mode ", "529. Romans not only clarified basic notions but developed a whole armoury of new forms in which law could be declared or made : Lex; Plebiscitum; Magistratuum Edicta; Senatusconsulta; Responsa Prudentium; Principum Placita. The last mentioned consisted of orders of Roman Emperors which were of various kinds, some of general application to cases of particular kinds and others for particular individual cases : Edicta, Decreta, Mandata, Rescripta. They had the \"force of law\" or \"Lex\" which could be roughly equated with our statutory law.\"Decreta\" were issued as decisions on individual disputes, in exercise of the Emperor's power \"under\" the authority of \"Lex de Imperio\", although\" ", "in the classical period it was firmly established that what the Emperor ordained had the force of law \"(See : on Roman Law, 1961, p. 32 Edn.). The point to note is that, even in the embryonic stages of government through legislation law making a decision of individual cases are found distinctly separate. ", "530. After the break-up of the Roman empire, there were attempts in medieval Europe, both by the and the Kings, to develop spiritual and temporal means for checking wrong and oppression. Quests for the superior or a sovereign power and its theoretical justifications by both ecclesiastical and lay thinkers were part of an attempt to meet this need. The claims of whose who, as vicars of God on earth, sought to meddle with mundane and temporal affairs and acquire even political power and influence were, after a struggle for power, which look different forms in different countries, finally defeated by European kings with the aid of their subjects. Indeed, these kings tried to snatch, and not without success, to wear spiritual crowns which the roles of \"defenders of the faith\" carried with them so as to surround themselves with auras of divinity. ", "531. The theory of a legally sovereign unquestionable authority of the King, based on physical might and victory in battle, appears to have been developed in ancient India as well, by , although the concept of Dharma, based on the authority of the assemblies of those who were learned in the Dharmashastras, also completed for control over exercise of royal secular power. High philosophy and religion, however, often seem to have influenced and affected the actual exercise of sovereign power and such slight law-making as the King may gave attempted. The ideal King, in ancient India, was conceived of primarily as a Judge deciding cases or giving orders to meet specific situations in accordance with the Dharmashastras. It also appears that the actual exercise of the power to administer justice was often delegated by the King to his judges in ancient India. Indeed, according to some, the theory of separation of powers appears to have been carried so far (See : in \"Manu and Yajnavalkya\"- A b ", "532. We know that Semetic prophets, as messengers of God, also became rulers wielding both spiritual and political temporal power and authority although to Jesus Christ, who never sought temporal power, is ascribed the saying :\" ", "Render unto Caesar the things that are Caesar's and to God things that are God's \". According to the theory embodied in this saying, spiritual and temporal powers and authorities had to operate in different orbits of power altogether. Another theory, however, was than the messenger of God had given the sovereign will of God Almighty which governed all matters and this could not be departed from by any human authority or ruler. In the practical administration of justice, we are informed, Muslim caliphs acknowledge and upheld the jurisdiction of their s to give judgment against them personally. There is an account of how the Caliph , being a defendant in a claim brought by a Jew for some money borrowed by him for purposes of , appeared in person in the Court of his own ", "533. Theory, therefore, that there should be a separation of functions between the making of laws, the execution of laws, and the application of laws, after ascertaining facts satisfactorily, is not new. It is embedded in our own best traditions. It is dictated, if by nothing else, by common sense and the principle of division of labour, without an application of which efficient performance of any duties cannot be expected. ", "534. We may now look back at the theory and practice of sovereignty in Europe. There, wise kings, in the middle ages, sought the support of their subjects in gatherings or \"colloquia\", which, in the words of Mr. (See : \"Sovereignty, an Inquiry into the Political Good\" p. 177),\" ", "had the triple character of a session of justice, a council of and the timid beginnings of a legislative assembly were the means by which the affairs of the realm came more and more into the hands of the King\". He goes on to observe : ", "\" The council of the King and the courts of justice progressively developed an independent life, the assembly remaining under the name of parliament in England and in France \". ", "535. , writing in the reign of of France (1551 to 1589), viewed sovereignty as a absolute unlimited power which, though established by law, was not controlled by it. According to him, under an ideal system sovereignty was vested in the King by driven right. The King's word was law. But, even according to , although the sovereign was free from the trammels of positive law, as he was above it, yet, he was\" ", "bound by divine law and the law of nature as well as by the common law of nations which embodies principles distinct from these\"(See : 's\" History of Political Theories Ancient & Medieval \"p. 28). , a century later continued this line of thinking on an entirely secular and non-moral plane. He opined :\" ", "Unlimited power and unfettered discretion as to ways and means are possessed by the sovereign for the end with a view to which civil society is constituted, namely, peace and escape from the evils of the state of nature\", in which the life of individuals was\" nasty, brutish, an ", "536. As we know, in the 17th and 18th centuries, European monarchs came in sharp conflict with the representatives of their subjects assembled in \"\" in England and in in France. And, theories were put forward setting up, as against the claims of kings to rule as absolute sovereigns by indefeasible divine right, no lesser claims to inviolability and even divinity of the rights of the people. But, theories apart, practice of the art of government proves that the effective power to govern by the very nature of conditions needed for its efficient exercise, has had to be generally lodged in one or few especially in times of crisis, but not in all those who represent the people even under democratic forms of Government. Direct democracy, except in small city States such as those or ancient Greece, is not practically feasible. ", "537. Theories of popular sovereignty put forward by and came to the forefront in the 17th and 18th centuries - an era of revolutionary changes and upheavals. The theory of certain immutable individual natural rights, as the basis of a set of positive legal rights, essential and necessary to the fulfillment of the needs of human beings as individuals, was advanced by . He visualised a social contract as a means of achieving the welfare of individuals composing Society. He also advocated separation of powers of government in a Constitution as a method of securing rights of individual citizens against even their own governments. elaborated this theory. The ideas of were amongst those which contributed to produce that great conflagration, the French Revolution, which was described by as the \"bonfire of feudalism : Government, according to , in all its departments, was the agent of the General Will of the sovereign people whose welfare must always be its ai\" ", "There's on earth a yet auguster thing, veiled though it be, than and king.\" ", " said : ", "\" It is to this 'auguster thing', not to such supreme power as English lawyers held to be vested in 'Parliament and King', that 's account of the sovereign is really applicable \". ", "538. The ideas of were subsequently used by and idealist political philosophers to deify the as the repository of the \"Real Will\" of the people and by Marxists to build their their of a dictatorship of the proletariat. But, the views of and were sought to be given a practical form by American Constitution-makers, who imbued with them, devised a machinery for the control of sovereign power of the people placed in the hands of the three organs of so that it may not be misused. Suspicion of governmental power and fear of its misuse, which characterised liberal democratic thinking, underlay the doctrine of separation of powers embodied in the American Constitution. ", "539. \"The merits of democracy\", according to (See : \"Power : A New Social Analysis\" p. 187)\" ", "are negative : It does not insure good government, but it prevents certain evils\". He pointed out (at p. 188) : ", "\" It is possible, in a democracy, for the majority to exercise a brutal and wholly unnecessary tyranny over a minority....... The safeguarding of minorities, so far as is compatible with orderly Government, is an essential part of the taming of power.\" ", "He also said (at p. 192) : ", "\" Where democracy exists, there is still need to safeguard individuals and minorities against tyranny, both because tyranny is undesirable in itself, and because it is likely to lead to breaches of order. 's advocacy of the separation of legislative, executive and judiciary, the traditional English belief in checks and balances, 's political doctrines and the whole of nineteenth century liberalism, were designed to prevent the arbitrary exercise of power. But such methods have come to be considered incompatible with efficiency \". ", "540. Some quite honest, upright, and intelligent people think that the inefficiency, the corruption, the expense, the waste of time and effort, and the delay in accomplishing what they regard as much too urgently needed socio-economic and cultural transformations of backward peoples today, involved in treading the democratic path, are so great that they would readily sacrifice at least some of the democratic processes and such safeguards against their misuse as separation of powers and judicial review are meant to provide. They would not mind taking the risk of falling into the fire to escape from what they believe to be a frying pan. Some may even agree with , who liked to look at everything turned upside down in attempts to understand them, that Democracy, with all its expensive and time-consuming accompaniments, is, even in the most advanced coteries, only a method of deluding the mass of the people into believing that they are the rulers whilst the real poser is always enjoyed by the few who ", "541. Judges must, no doubt, be impartial and independent. They cannot, in a period of intensified socio-economic conflicts, either become tools of any vested interests, or function, from the bench, as zealous reformers propagating particular causes. Nevertheless, they cannot be expected to have not notions whatsoever of their own, or to have completely blank minds on important questions indicated above which, though related to law, really fall outside the realm of law. They cannot dwell in ivory towers or confine their processes of thinking in some hermetically sealed chambers of purely legal logic artificially cut off from the needs of life around to which law must respond. Their deferring individual philosophies, outlooks, and attitudes of vital questions, resulting from differences in life, will often determine their honest choices between two or more reasonably possible interpretations of such words as \"amendment\" or \"constituent power\" in the Constitution. But, on certain clear matters of principle, und ", "542. A lamentable example of what took place in the course of English constitutional history when , composed of very intelligent and learned people, one of whom, , subsequently became a distinguished Chief Justice of England, took upon itself to sit in judgment on a decision of two Judges of one of whom was suspected of being a partisan of Royal prerogative and power at a time when a struggle for supremacy between the competing legal claims of the King, as the titular sovereign, and those of , as representing the people, was still going on. In strict law, which was unwritten, the position on that problem of power was not suite clear at that time. The episode is thus described by Lord , C.J. in v. 180 (at p. 1163).\" ", "The next case to which I advert in truth embraced no question of privilege whatever; but, as one of the highest authorities in the State has thought otherwise, I shall offer some comments upon it; I mean v. . ordered the defendant, their sergeant at-arms, to arrest and imprison the plaintiff for having dared to exercise the common right of all Englishmen, of presenting a petition to the King on the state of public affairs at a time when no existed. For this imprisonment an action was brought. The declaration complained, not only of the personal trespass, but also of extortion of the plaintiff's money practiced by defendant under colour of the Speaker's warrant. The plea of justification under that warrant, which could not possibly authorise the exertion, even if it could the arrest, was overruled by this Court, no doubt with the utmost propriety, for the law was clear; Lord points this out in the most forcible manner, in 14 East 109. Yet for this righte ", "543. In v. (supra) the action of , on v. (supra), was practically declared to be illegal or unconstitutional for arbitrariness. The sovereign British , however, did not alter but has acquiesced in the law as stated by Lord who pointed out, by references to a number of precedents, that common law courts had continuously been determining questions relating to the very existence of an alleged privilege and defining its orbit on claims based on the ground of a parliamentary privilege. And, English courts have gone on doing this unhesitatingly after v. (supra), just as they had done earlier, as a part of their function and duty to interpret and declare the law as it exists. ", "544. Let me go back a little further to the time when another English Chief Justice, Sir , who on being summoned, with his brother Judges, by King , to answer why the King could not himself decide cases which had to go before his own courts of justice, asserted : ", "\".... no king after the conquest assumed to himself to give any judgment in any cause whatsoever, which concerned the administration of justice within this realm, but these were solely determined in the courts of justice\". When the King said that\" he thought the law was founded on reason, and that he and others had reason, as well as the Judges\", answered : ", "\" True it was, that God had endowed his Majesty with excellent science, and great endowments of nature; but his Majesty was not learned in the laws of his realm of England, and causes which concern the life, or inheritance, or goods, or fortunes of his subjects, are not to be decided by natural reason, but by the artificial reason and judgment of the law, which law is an act which requires long study and experience, before that a man can attain to the recognizance of it; and that the law was the golden metwand and measure to try the causes of the subjects; and which protected his Majesty in safety and peace. (\"The Higher Law -Background of American Constitutional Law\" by , pp. 38-39). ", "545. We know that even advanced the claim, in 's case that courts could invalidate Acts of Parliament if they contravened rules of natural justice such as that a man shall not be heard before he is condemned or that he should be a judge in his own cause. As points out, in an appendix to \"The law and the Constitution\"(5th Edn., 1959, p. 318) the theory of parliamentary sovereignty or supremacy could, by no means, be said to be firmly established in England in 's time. ", "546. , while enunciating the theory of parliamentary sovereignty in the 19th century, as it was to be later expounded in the 20th century by Prof. , also claimed superiority for \"the law of nature which was common to all mankind\". He said about this law :\" ", "It is binding over all the globe, in all countries, and at all times : no human laws are of any validity if contrary to this; and such of them as are valid derive all their force and all their authority, mediately or immediately, from this original; ", "\"(See : Dicey - Law of the Constitution, P. 62). ", "547. It is a matter of legal and constitutional history that English judges finally rejected claims based upon vague philosophical concepts or upon a law of nature or appeals to the \"Yet auguster thing\" pitted against statutory law exception so far as certain rules of natural justice and reason could impliedly be read into Acts of due to absence of statutory prohibition and the need to observe them having regard to the character of the function required by a statute to be performed. Constitutional historians, such as , have pointed out how English common lawyers, some presiding as Judges over King's courts of justice, others sitting in as legislators, joined hands to evolve, sustain, and give life to principles of \"Sovereignty of \" and the \"Rule of law\" as understood by them. asserted, in his \"Law of the Constitution\", that both these principles so operated as to reinforce each other instead of coming into conflict with each other. One wonders whether this coul ", "548. , dealing with the development of American Constitutional Law, wrote about the claim of , mentioned above, to invalidate Acts of Parliament by reference to certain fundamental principles of natural justice and of common law (See : on Constitutional Law, 1936 Edn. p. ", "76) :\" ", "This dictum of , announced in Dr. 's case was soon repudiated in England, but the doctrine announced in 's dictum found fertile soil in the United States and sprouted into such a vigorous growth that it was applied by in the decision of cases coming before it; and it has been said that the doctrine of the supremacy of is the logical conclusion of 's doctrine of control of the courts over legislation \". ", "549. It seems to me that judicial review of all law-making, whether it appertains to the sphere of fundamental law or of ordinary law, is traceable to the doctrine of judicial control by reference to certain basic principles contained in a Constitution and considered too inviolable to be easily alterable. It may be that this doctrine is unsuitable for our country at a time when it is going through rapid socio-economic transformation. Nevertheless, so long as the doctrine is found embodied in our Constitution, we cannot refuse to recognise it. ", "550. In America, there was some doubt whether the doctrine of judicial review of all legislation naturally flowed out of the vesting of judicial power by Section 1 of Article 3 of their Constitution which says :\" ", "The judicial power of the United States shall be vested in one , and in such inferior Courts as the may, from time to time, ordain and establish \". (Willis on Constitutional Law, p. 1020). ", "There is no article there, like Article 13 of our Constitution, which declared any kind of legislation abridging or taking away fundamental rights to be \"void\". The doubt was not without substance. It was removed by Chief justice whose judgment in v. , firmly established the doctrine of judicial review and the supremacy of , in the judicial field of interpretation, as the mouthpiece of the Constitution, and, therefore, of the \"Real Will\" of the people themselves. The Constitution, as the basic or fundamental law of the land, was to operate there as the touchstone of the validity of ordinary laws just as the validity of laws made by British colonial legislatures was tested by reference to the parental Act of the British Parliament. ", "551. Under our Constitution, by Article 141 of the Constitution, power is vested only in and in no other organ or authority of the Republic to declare the law \"Which shall be binding on all s within the territory of India\". Article 143 of the Constitution of India also shown that whenever questions of facet of law have either arisen or are likely to arise, the President of India may, in view of their public importance, seek the opinion of , by a reference made to the . The procedure on such a reference is that of a judicial authority which hears those interested and then gives its opinion. Article 32 of the Constitution gives a wide power to \"to issue directions or orders or writs\", which is larger than that of the British courts issuing prerogative writs, although it is confined to the enforcement of the rights conferred by Part III dealings with fundamental rights. The power of the High s of the various States under Article 226 of the Cons ", "552. The claim therefore, that an amalgam or some undifferentiated residue of inherent power, incapable of precise definition and including judicial power, vests in in its role as a constituent authority, cannot be substantiated by a reference to any article of the Constitution whatsoever, whether substantive or procedural. Attempts are made to infer such a power from mere theory and speculation as to the nature of the \"constituent power\" itself. I do not think that, because the constituent power necessarily carries with it that power to constitute judicial authorities, it must also, by implication, means that the , acting in its constituent capacity, can exercise the judicial power itself directly without vesting it in itself first by an amendment of the Constitution. The last mentioned objection may appear to be procedural only, but, as a matter of correct interpretation of the Constitution, and, even more so, from the point of view of correct theory and principle, from which no practi ", "553. This impels me to consider such theories of sovereignty as we may find embedded in our Constitution. It is noteworthy that the phrase \"sovereignty and integrity of India\" was inserted in 1963 in Article 19(2 ), (3) and (4 ), to denote the political independence and wholeness of the country, vis-a- vis other countries. It was also introduced in the oaths of \"allegiance\" to the Constitution prescribed in the Third Schedule indicating that the duty to uphold the \"sovereignty and integrity of India\" from a recognition of the supremacy of the Constitution. The term \"sovereign\" is only used in the preamble of our Constitution, which says :\" ", "We, the people of India, having solemnly resolved to constitute India into a Sovereign Democratic Republic and to secure to all its citizens : ", "In our this twenty-sixth day of November, 1949 do hereby adopt, enact and give to ourselves this Constitution. ", "\"554. This Court, exercising the powers vested in it under the Constitution to declare the law of the land, cannot go behind the clear words of the Constitution on such a matter. We have to presume that the Constitution was actually made by the people of India by virtue of their political sovereignty which enabled them to create a legally Sovereign Democratic Republic to which they consigned or entrusted, through the Constitution, the use of sovereign power to be exercised, in its different forms, by the three different organs of Government, each acting on behalf of the whole people, so as to serve the objects stated in the Preamble. This reference to \"the people of India\" is much more than a legal fiction. It is an assertion in the basic legal instrument for the governance of this country of the fact of a new political power. The legal effect of the terms of the instrument is another matter. ", "555. It has been pointed out, in case (supra), that the preamble of our Constitution did not like that of the American Constitution, \"walk before the Constitution\" but was adopted after the rest of the Constitution was passed, so that it is really a part of the Constitution itself. It means that the Constitution is a document recording an Act of entrustment and conveyance by the people of India, the political sovereign, of legal authority to act on its behalf to a \"Sovereign Democratic Republic\".\" ", "This Constitution \"has a basic structure comprising the tree organs of the Republic : the , the , and the . It is through each of these organs that the Sovereign Will of the People has to operate and manifest itself and not through only one of them. Neither of these three separate organs of the Republic can take over the function assigned to the other. This is the basic structure or scheme of the system of laid down in this Constitutio ", "556. In case (supra), I had approvingly quoted the view of Prof. , who, in his \"Principles of Social and Political Theory\", claiming to be elaborating the theory underlying the preamble to our own Constitution, pointed out that, inasmuch as the Constitution is the instrument which regulates the distribution between and exercise of sovereign power, by the three organs of the , and it is there constantly to govern and to be referred to and to be appealed to in any and every case of doubt and difficulty, it could itself, conceptually, be regarded as the true or \"ultimate\" sovereign, that is to say, sovereign as compared with \"immediate\" sovereignty of an organ of the Republic acting within its own sphere and at its own level. ", "557. Of course, inasmuch as the power of altering every feature of the Constitution remains elsewhere politically, the Constitution is neither the ultimate \"political\" sovereign nor a legally unalterable and absolute sovereign. All constitutional and \"legal\" sovereigns are necessarily restrained and limited sovereigns. I thought and still think that such a working theory should be acceptable to lawyers, particularly as the dignitaries of , including judges of superior courts, and all the legislators, who have to take oaths prescribed by the Third Schedule of our Constitution, swear \"allegiance\" to the Constitution as though the document itself is a personal ruler. This accords with our own ancient notions of the law as \"The King of Kings\" and the majesty of all that it stands for : The Rightfulness of the Ends as well as of the Means. ", "558. The theory outlined above would, of course, be unacceptable if sovereignty must necessarily be indivisible and located in a determinate living person or persons - a really medieval concept which is not generally employed today even to describe the titular hereditary monarchs as \"sovereign\" as the human ruler. Modern theories of even political sovereignty advanced by - e.g. , , , - look upon it as divisible and not as absolute and unlimited. Indeed they go to the extent of practically denuding sovereignty of all its customary connotations. abandons \"sovereignty\" as an obsolescent doctrine and displaces it by the ruling principle of \"sovereignty\" as an obsolescent doctrine and displaces it by the ruling principle of \"social solidarity\". thinks that the traditional concepts of sovereignty, dominated too long by legalistic Austinian views, needs to be discarded. His conclusion is that the , with which doctrine of sovereignty has been bound up,\" ", "At any moment the is more the official guardian than the maker of the law. Its chief task is to uphold the rule of law, and this implies that it is itself also the subject of law, that it is bound in the system of legal values which it maintains.\"(See : :\" The Modern \"p. 478) , while mainly accepting this rather negative approach, reminiscent of 19th century liberalism, would accord the a much more positive role in the interests not only of social order but also of socio-economic engineering and progress. ", "559. , who saw in the and its laws and all institutions supporting an existing social order, the means of oppression and exploitation of the mass of the people, dreamt of the \"withering away\" of the with its claims to \"sovereignty\". But, the Russian Revolution was followed by the vastly increased powers of the run for the benefit of the proletariat. Nevertheless, the Constitution of the U. S. S. R. guarantees to citizens not merely fundamental rights, including the right to work, but has a special department of the Procurator General to enforce due observance of legality according to the law of the Constitution, by all the functionaries of . Article 104 of their Constitution reads.\" ", "104. of the U. S. S. R. is the highest judicial organ. of the U. S. S. R. is charged with the supervision of the judicial activities of all the judicial organs of the U. S. S. R. land of the Union Republic within the limits established by law. ", "\"(See , M. Kirichenko : Soviet State Law, p. 400) ", "560. It is true that legality is enforced in the U. S. S. R. not merely through the organs of the but the vigilance of the Communist party which consists of selected persons keeping a watch on the policy of the . , however explained (See : Fundamental Tasks of Soviet Law 1938) that Soviet\" ", "law can no more be reduced simply to policy than cause can be identified with effect\". Strict observance of\" Socialist Legality \", under the supremacy of the Constitution, is entrusted to the care of the , with its three organs, , and the people of the U. S. S. R. (See : \"The Soviet Legal System\" by M/s. and ). Although Article 15 of the Constitution of the U. S. S. R. speaks of the \"Sovereignty and Sovereign Rights\" of the Union Republic, yet, it is made clear that these republic function subject to the supremacy of the Constitution. Hence, the supremacy of the Constitution is a principle recognised by the Constitution of the U. S. S. R. also as ", "561. made a wide survey and a penetrating analysis of juristic thinking upto the end of the 10th century on sovereignty, derived, on the one hand, from theories of the sovereignty of the ruler, and, on the other from theories of popular sovereignty. He observed (See : \"Natural Law and Theory of Society\" by Otto translated by , Vol. I, p. ", "153) about the approach of :\" ", " sketches, indeed, an ideal constitutional State in which popular sovereignty is nominally present : but no living 'subject' of supreme authority is anywhere really to be found in this State. The 'bearers' of the different powers (legislative, executive and judicial) are supposed to govern, but each is subject to a strict legal obligation appropriate to its own sphere; and over them all, as the Sovereign proper, the abstract Law of Reason is finally enthroned.\" ", "He concluded (at p. 153) : ", "\" The history of the theory of constitutionalism shows how a doctrine derived from the principle of popular sovereignty could produce almost the same results as the other (and apparently opposite) system of thought which started from the principle of the sovereignty of the ruler. In the one case, just as in the other, the inviolability of sovereignty, and the unity of the personality of the State, are sacrificed, in order to attain the possibility of a constitutional law which is binding even on the Sovereign. ", "562. A theory of a \"Legal Sovereignty\" must necessarily democrate the sphere of its \"legal\" or proper operation as opposed to mere use of power either capriciously or divorced from human reason and natural justice. statement of it, quoted by me in 's case (supra), seemed to me to satisfy this requirement. After pointing out that sovereignty, by which I understand one recognised by law, is limited both by its own \"nature\" as well as its \"mode of action\", it concludes : (at pp. 867-868) : ", "\"Sovereignty moves within the circle of the legal association, and only within the circle it decides upon questions of a legal order, and only upon those questions. Moving within that circle, and decides upon questions of a legal order, and only upon those questions. Moving within that circle, and deciding upon those questions, sovereignty will only make legal pronouncements, is not a capricious power of doing anything in any way : it is a legal power of settling finally legal questions in a legal way.\" ", "There should be no difficulty in accepting such a theory if one can conceive of an ordered system or \"government of laws\" as opposed to a \"government of men\" placed beyond limitations of this kind. At any rate, it is implicity in the very idea of a Constitution. Our Constitution not only regulates the operations of the organs of but symbolises the unity of the republic and contains the inspiring hopes and aspirations and cherished goals of all the efforts of the nation. It operates not merely through the law but also on the minds and feelings of the people. ", "563. Prof. , in his \"Constitutional Law of the United States\" advocates the doctrine of \"sovereignty of the people\" for which he finds support in well-known description of the American system as \"a Government of the people, for the people, for the people, by the people\" as well as in a number of pronouncements of . After considering and rejecting a whole host of theories of political philosophers and jurists, including those of , , , , , , , , , , , and , he opines (at p. 51) : ", "\"As says, the forces which determine the government are sovereign. The effective social forces are not the Union, nor the , nor the oligarchy of , nor the organs of Government, nor the Constitution, nor natural law, but those forces which created these organisations and agents and institutions, and to whom they are all ultimately responsible.\"According to him, the\" Sovereignty of the People\" ", "which he advocates does not mean an anarchic license given to each individual or group to do as he or it pleases, but stands for the power of the people, \"organised in Government to express and adjust their will either directly or through representatives\" ", ". He explains, in the rest of his work, how the of the U. S. A., in the broader sense of all that social control which, operating through the three departments of , has to take place in accordance with the Constitution. This concept of a nation \"organised in \" appears to me to clearly introduce the idea of a Constitution which lays down what the organisation is and how it must operate. Although Prof. rejects the view that the Constitution is \"sovereign\", because it can be altered by the people, he is obliged to accept something resembling it because he sees that the \"people\", thought of as a mere aggregation or an amorphous mass, is too nebulous. Any satisfactory theory of sov ", "564. Another American writer, , has put forward the view that sovereignty, as an attribute of the , conceived of as a juristic entity apart from its governmental organs, cannot be legally limited. According to him, to limit it is to destroy it. He says (See : on \"Fundamental Concepts of Public Law\"- Tagore Law Lectures, 1924, at p. ", "77) : ", "\"There would seem to be no more value in attaching legal rights and duties to the sovereign State than there is in predicating the attributes of goodness and justice of a Divine Being who is regarded as Himself the creator, by His own unrestrained will, of all distinctions between goodness and badness.\" ", "But, this seems a metaphysical than a realistic, more amoral Machiavellian than a -Gandhian stance. If one's concepts of the Divine Being are to be introduced it no law, one could refer to those also which see Divinity only that order and that Law which seems to pervade and govern the whole physical world the universe. Indeed, there are judicial dicta to the effect that God Himself considered Himself bound by those elementary principles of justice whose love was planted in man by Him. In v. , , J. observed. ", "\"The laws of and man both give the party an opportunity to make his defence, if he has any. I remember to have heard it observed by a very learned man, upon such an occasion, that even himself did not pass sentence upon Adam before he was called upon to make his defence.'Adam' (says ), 'where art thou? Has thou not eaten of the tree whereof I commanded thee that thou shouldst not eat? And the same question was put to Eve also.\" ", "565. It is clear that no simple theory of sovereignty fits the complex facts of modern life. Every theory of today, ultimately, rests on concepts more refined than the physical or spiritual might of some ruler, in whom executive, legislative, and judicial powers coalesce to take away all legal distinction between them. Even , dealing with constitutionalism ( on \"Nature of the State\" 198, at p. 302) says : ", "\"The value of constitutional government is not that it places sovereignty in the hands of the people, but that it prescribed definite ways in which this sovereign power shall be exercised by the State\" ", ". ", "Hence, he too admits that the Constitution does place some limitation on exercise of sovereign power. That seems to me to be the essence of a Constitution and the rationale of its existence. ", "566. Still another American writer, , in the course of his discussion (See : \"The Amending of the Federal Constitution\" by Lester B. 1971), of a number of concepts of sovereignty, seems sometimes to almost consider Article 5 of the American Constitution, containing the constituent power and its procedure, to be sovereign. He concludes his discussion on the subject as follows (at p. 166) : ", "\"Each part of the amending body is subject to law, and may be altered or abolished. The amending body itself may be altered through the amending process, and limitations on the future amending capacity may be imposed. The amending body is an artificial sovereign deriving its being from a law in the form of Article Five. The amending groups hold office for but a short time, and may be supplanted by others in the elections in which an increasingly larger electorate participates. The theory of sovereignty, moreover, presupposes the continued orderly existence of the government. In case of a revolution the commands of the sovereign would be disregarded, and authority could no longer be ascribed to the amending body either in fact or in law. The moral, religious, physical, and other factual limitations on the supposed sovereign are so important that it may perhaps be correct to say that they are also legal limitations, as there comes a time when law and facts shade into one another. Finally, when it is rememberedHe rejects the concept of sovereignty of the people as too vague and meaningless. And, for the reasons given above, he rejects the theory of a sovereignty of the amending body. His final conclusion seems to be that it is better to avoid altogether entanglement in the concept of sovereignty. This view, however, overlooks the fact that lawyers need a working theory of sovereignty to be able to decide legal questions before them. As between the sovereignty of the amending article and the sovereignty of the Constitution there should be little, doubt that lawyers should and would prefer the sovereignty or supremacy of the whole Constitution rather than of any part of it. On the face of it, it appears more reasonable and respectable to swear allegiance to the whole Constitution, as we actually do, rather than to Article 368 or to the amending powers contained in it. If there is a part of our Constitution which deserves greater devotion than any other part of it, it is certainly the preamble to our Constitution. ", "567. The American Supreme court, in the context of the especially American conditions and needs, after leaning sometimes towards a recognition of \"State Sovereignty\"(See. v. ; Dred Scott v. ) and at others towards a recognition of the dual system of Government which has prevailed in America (See : e.g. v. ) has, on the whole opted, of the \"Sovereignty of the People\" which unifies the nation (See e.g. v. , v. ; National Prohibition Cases). ", "568. I cannot, while I am on the subject of American conditions, resist the temptation to quote the trenchan comments of Prof. on what he considers to be the dangers of the American system of government. He wrote (at pp. 68-69) :\" ", "But the greatest danger in popular sovereignty does not lie in the intellectual field, but in the moral. While our intellectual level is not as high as it ought to be, our moral level is much lower than it can safely be if our form of government is to endure permanently. Millions of our citizens are already members of the criminal class. Millions of other citizens who are not yet members of the criminal class are in he economic world doing things just as bad as the things which members of the criminal class are doing. Millions of our people are concerned with their own selfish interests instead of the common good. Millions of our citizens are only too ready to ruin themselves and the rest of our people physically, intellectually, and morally by drugs and intoxicating liquors and vices. Our people do not seem to be much concerned with high ideals in any of the fields of human endeavour. Our people as a whole do not seem to be seriously concerned with social planning for the purpose of obtaining an ideal sociThe effects of the moral standards of our people are already manifest. As a result of our political and economic theories, there has developed a concentration of wealth unparalleled in human history. While on the whole the economic level is comparatively high in the United States, the difference between the wealth of the many and that of the few is startling. One-fourth of the families in the United States before the depression had incomes of less than $ 500 and two-thirds of the families in the United States incomes of less than $ 1, 000, while 2 per cent of our population owned 65 per cent of the wealth. There were four men any one of whom had an income as large as five million of the poorest people in the United States. This concentration of wealth was probably one of the primary causes of the depression, and the depression has threatened our capitalistic system. This only shows the danger inherent in our political organisation. ", "\"569. If the people of an advanced country like the U. S. A., left entirely to the concept of popular sovereignty, have revealed the need for a more positive guiding or moulding role of their so as to overcome the dangers adverted to by Prof. , how much greater are the needs of a people potentially so great but actually so backward economically and educationally as ours, taken en masse, still are? Our concepts of sovereignty must accord with the needs of the people of our country. Our Constitution, which has been described by as \"the cornerstone of the Nation\", was devised as a means to serve those needs. It has not only the elevating preamble, deserving the allegiance of every rational human being, but, unlike the American Constitution, the whole of Part IV of our Constitution which contains \"Directive Principles of Policy\" to guide the future course of action particularly in the legislative field. It is true that provisions of Part IV are not enforceable through the courts ", "570. I find that the doctrine of the supremacy or sovereignty of the Constitution was adopted by a Bench of seven learned Judges of this Court in Special Reference No. 1 of 1964, where , , speaking for six learned Judges of this Court said (at p. 446) :\" ", "In a democratic country governed by a written Constitution which is supreme and sovereign. It is no doubt true that the Constitution itself can be amended by the , but that is possible because Article 368 of the Constitution can be validly made only by following the procedure prescribed by the said article. That shows that even when the purports to amend the Constitution, it has to comply with the relevant mandate of the Constitution itself. Legislators, Ministers, and Judges all take oath of allegiance to the Constitution, for it is by the relevant provisions of the Constitution that they derive their authority and jurisdiction and it is to the provisions of the Constitution that they owe allegiance. Therefore, there can be no doubt that the sovereignty which can be claimed by the in England, cannot be claimed by any in India in the literal absolute sense. ", "\"571. The principle of the supremacy of the Constitution was then declared by the majority of the learned Judges of this Court in case (supra) to be a part of the basic structure of the Constitution. The minority opinion, while not specifically dissenting from this view, was that even what was considered by the majority to be a part of \"basic structure\" was alterable under Article 368. But no judge of this Court has so far held that, without attempting to change what may be the basic structure of Constitution itself, appropriate amendments, judicial power could be exercised by under Article 368 on the assumption that it was already there. ", "572. M. C. Setalvad, a distinguished jurist of India, said (See : \"The Common Law of India\" Hamlyn Lectures, 12th series, 1960) (at pp. 174-175) :\" ", "The Constitution divides the functions of the into the three categories of executive, legislative and judicial functions following the pattern of the British North America Act and the Commonwealth of Australia Act. Though this division of functions is not based on the doctrine of separation of powers as in the United s yet there is a broad division of functions between the appropriate authorities so that, for example, the will not be entitled to arrogate to itself the judicial function of adjudication.'The Indian Constitution has not indeed recognised the doctrine of separation of powers in its absolute rigidity but the functions of the different parts or branches of the have been sufficiently differentiated and consequently it can very well be said that our Constitution does not contemplate assumption, by one organ or part of the , of functions that essentially belong to another.' (See : ). This will no doubt strike one acc ", "573. , the celebrated propounder of the doctrine of the sovereignty of , had criticized for frequently mixing up \"legal sovereignty\" and \"political sovereignty\"(See : Law of the Constitution by , 10th Edn., p. 72). He contrasted the British principle of \"ary Sovereignty\" with what was described by him the \"Supremacy of the Constitution\" in America. He observed (at p. 165) : ", "\"But, if their notions were conceptions derived from English law, the great statesmen of America gave to old ideas a perfectly new expansion, and for the first time in the history of the world formed a Constitution which should in strictness be 1 the law of the land', and in so doing created modern federalism. For the essential characteristics of federalism - the supremacy of the Constitution the distribution of powers the authority of the - reappear, though no doubt with modifications, in every true federal State.\"He said (at p. 144) : ", "\" A federal State derives its existence from the Constitution, just as a corporation derives its existence from the grant by which it is created. Hence, every power, executive, legislative, or judicial, whether it belong to the nation or to the individual States, is subordinate to and controlled by the Constitution.\" ", "He wrote about (at p. 159) : ", "\" Of the nature and position of itself this much alone need for our present purpose be noted. The court derives its existence from the Constitution, and stands therefore on an equality with the President and with ; the members thereof (in common with every Judge of ) hold their places during good behaviour, at salaries which cannot be diminished during a judge's tenure of office.\" ", "574. The theory of the supremacy of the Constitution is thus not a new one at all. It is inherent in the very concept of \"the auguster thing\" which lies behind or King and is sought to be embodied in the Constitution of a country. The judges, who are vested with the authority and charged with the duty to uphold the Constitution, do so as the mouth- pieces of what has been called the \"Real Will\" of the people themselves by political philosophers such as . That, as I have indicated earlier, is the theory underlying the system of judicial review. Such a system may delay changes but should not, I think, speaking entirely for myself, deny or defeat the right of the people to bring about any change, whether basic or not, in the Constitution. Indeed, in case (supra), I indicated that I thought that the most proper and appropriate function of the amending power in Constitution, which is also a part of the Constitution, and, indeed, its most potent part - was that of making ba ", "575. It has not been argued before us that the introduction by the Twenty- fourth Amendment of the new clause (1) in Article 368 , containing \"constituent power\", itself amplifies or increases the contents or changes the character of the power in Article 368 by making it a composite power so as to include a new type of judicial or quasi-judicial power also within its fold now. It is evident from the judgments of learned Judges of this Court in 's case (supra) that possible distinctions between amending power and \"constituent power\" and \"sovereign power\" figured prominently in arguments in that case. , J., in his minority opinion [See : 1967 (2) SCR 833 ], said that it was not necessary, for the purposes of that case, whether the amending power was as wide as the \"sovereign power\" of which had framed our Constitution. After all the discussion that had taken place then, came the Twenty-fourth Amendment. It does not use the words \"constituent power\" were advisedly use ", "576. The \"constituent power\" is still bound by the exclusively prescribed procedure to \"amend by way of addition, variation, or repeal\" any elaborately set out in clause (2). In fact, Article 368 contains so much of the fundamental law-making or legislative procedure that five judges of this , led by , C.J., opined in 's case (supra), that it was confined to procedure and did not contain at all the substantive power to amend. Clause (1) of Article 368 , introduced by the Twenty-fourth Amendment, was, apparently, meant to remove this objection and to do no more. It could be intended to pour some new amalgam of executive and judicial or quasi-judicial substantive powers into it also by some implication so as to do away with the very need for such an elaborate and carefully drawn up Constitution such as ours. The absence of any quasi- judicial procedure, from the comprehensively framed procedural provisions of Article 368 , seems extremely significant. It indicates that it was clear intentio ", "577. Learned Counsel supporting the Thirty-ninth Amendment tried to find the meaning of \"constituent power\" in theoretical speculations about the meaning of \"sovereignty of the people\", on the one hand, and the sovereignty of the medieval monarch, on the other, instead of looking to the legislative history of the \"constituent power\". I have, therefore, also referred to some of these theories and practices from ancient times so as to be able to indicate the precise significance or relevance of various concepts and decisions placed before us. These theories and practices could have only an indirect bearing on the meaning of the term \"constituent power\" in Article 368. They are more germane to a statement of a correct theory of sovereignty which underlies what has been called the \"basic structure\" of our Constitution. ", "578. There are scattered dicta in the judgments of this Court speaking of the \"sovereignty of the people\" which, in my opinion, can only be related to the political sovereignty of the people recognised by the preamble to our Constitution where the people are described as the Constitution-makers who gave the Constitution unto themselves. This, however, does not, in my opinion, mean that the people retained unto themselves any residue of legal sovereignty. They did not prescribe, apart from dividing the exercise of sovereign power roughly between the three organs of the Republic, each with its own modus operandi, any other or direct method, such as Initiative or Referendum, for exercising their politically sovereign power. The view I have tried to put forward in the foregoing pages is that the people entrusted to the three organs of they constituted the exercise of three aspects of sovereign power on behalf of the people. This seems to me to be the only way of reconciling the ", "579. I have tried to point out that the term sovereignty in its origin is associated with the actual human ruler or authority wielding theoretically absolute or final powers. Political philosophers are particularly concerned with the problem of determining the location and manner of exercise of such powers if any. Jurists, however, have also occupied themselves with these problems partly because constitutional law, as once pointed out, has some overlapping territory with the political theory which underlies it. Some constitutional lawyers, such as , have said that it is flirtation with political theory which has brought into the juristic fold a term such as 'Sovereignty'. On the other hand, political theorists, such as , have blamed, far less justly, jurists like for infecting political theory with legalistic authoritarian notions of sovereignty. Political theorist, in their attempts to understand and rationalize, and sometimes to justify or condemn a system are more concerned ", "580. I do not think that it is at all helpful to refer to certain authorities of this Court which were, rather surprisingly, relied upon by learned Counsel supporting the Thirty-ninth Amendment to discover the nature of the \"constituent power\" contained in Article 368. I will content myself by citing a passage from the last of these cases relied upon which mentions the earlier cases of this Court also on the effect of a \"firman\" in . , J. speaking for this Court, said (at p. 591) : ", "\"In appreciating the effect of this firman, it is first necessary to decide whether the firman is a law or not. It is matter of common knowledge that at the relevant time the of Udaipur was an absolute monarch in whom vested all the legislative, judicial and executive powers of the State. In the case of an absolute ruler like the of Udaipur, it is difficult to make any distinction between an executive order issued by his or a legislative command issued by him. Any order, issued by such a ruler has the force of law and did govern the rights of the parties affected thereby. This position is covered by decisions of this Court and it has not been disputed before us. ; and .\" ", "581. It is evident, from the quotation, relied upon by the Solicitor- General, that this Court was not deciding whether the firman was even a \"law\" in the sense of a general norm which had to be applied to the decision of cases. It was held that whatever be its juristic character, it had the \"force of law\" inasmuch as the ruler of Udaipur was an absolute ruler, who combined in his person the legislative, the judicial and executive authority of the . That was the Constitution of Udaipur. The doctrine of separation of powers, in such a context, was really irrelevant. Article 368 of our Constitution, however, is not a power acquired by our Republic by succession from he power of Indian ruling princes. The legislative history behind it is entire different. ", "582. As a matter of legislative history, we will find the source of the \"Constituent power\" in Section 6 & 8 of the Indian Independence Act passed by . Section 6 of that Act constituted a \"\" for each of two dominions set up with plenary powers of legislation. The legislative powers of the of each dominion were so enlarged by Section 8 that it could frame the Constitution of the Dominion concerned. This was a transfer of only a legislative power. Section 8 said : ", "\"For the purpose of making provision as to the Constitution of the dominion, was recognised as the constituent assembly of the dominion.\" ", "These powers were\" plenary\" ", "in the sense in which this term is used in v. , but they were confined to law-making and did not extend to adjudication or decision of individual cases which is certainly distinguishable from a law-making power. For purposes other than framing of the Constitution, provisions of the Government of India Act operated until they were repealed and replaced by other relevant provisions. Such was the process of a legislative succession through which institutional transformation or transition to a new but corresponding set of institutions was brought about. In the eyes of law, this was an evolutionary process through constitutional channels and not a revolutionary break with the past. ", "583. I is true that, in the exercise of the law-making constituent power, brought in by Section 8 of the Indian Independence Act, the could be armed with judicial powers as well if appropriate laws were made to that effect. But, as no law, either constitutional or ordinary was passed, preceding Thirty-ninth Amendment to repeal the Act or 1951 and then to vest a judicial power in , so as to enable it to take over and decide election disputes itself directly. I do not see how clause (4) of Article 329A , if it contained certain provisions on the assumption that such a judicial power was already there in , could be valid as a piece of mere law-making. However, Counsel supporting the Thirty-ninth Amendment had submitted that Article 329A (4) evidenced the constituted an exercise of some \"unbroken\" or a combined legislative and judicial power - a proposition for which no precedent of any such consolidated action of a constituent body was cited from any part of the world. The firman ", "584. An attempt was made to convince us that what may not have been otherwise possible for Parliaments do became possible by invoking the presumed exercise of some judicial power imported by Article 105(3) of the Constitution which says : ", "\"105. (3).... the powers, privileges and immunities of each of , and of the members and the committees of each , shall be such as may from time to time be defined by by law, and, until so defined, shall be those of the of Commons of the of the United Kingdom, and of its members and committees, at the commencement of this Constitution.\" ", "585. I am unable to see how what was not conferred upon itself, in its constituent capacity, could be impliedly assumed to be there by virtue of certain \"powers, privileges and immunities\" which belong separately to each House of . Such a claim could not be based upon what is to be found directly in Article 368. It is sought to be derived from Article 105. This reasoning would, obviously, conflict with the provisions of Article 329(b) of the Constitution which indicates that an election dispute can only be resolved by an election petition before a forum provided by an ordinary enactment. Article 329(b) says : ", "\"329. (b) No election to either of Parliament or to the or either of the legislature of a State shall be called in question except by an election petition presented to such authority and in such manner as may be provided for by or under any law made by the appropriate .\" ", "586. In exercise of its powers under Article 329(b) our had enacted the Act of 1951. The procedure provided by the Act had the binding force of a constitutionality prescribed procedure. It could not be circumvented unless, with reference to cases covered by Article 329A(4 ), it had been first repealed. Only after such a repeal could any other forum or procedure be legally adopted. It could not be assumed, by reason of Article 105(3 ), that the prescribed forum had shifted to itself, and that , in exercise of its constituent function, had both legislated and adjudicated. This is what we were asked to accept. ", "587. The well recognised rule of construction of statutes, which must apply to the interpretation of the Constitution as well, is : \"Expressio unius est exclusio alterius\". From this is derived the subsidiary rule that an expressly laid down mode of doing something necessarily prohibits the doing of that thing in any other manner. The broad general principle is thus summarised in 's \"Statutory Constructions\"(1940) at p. 334 : ", "\"Express Mention and Implied Exclusion (Expressio unius est exclusio alterius. - As a general rule, in the interpretation of statutes, the mention of one thing implies the exclusion of another thing. It therefore logically follows that if a statute enumerates the things upon which it is to operate, everything else must necessarily, and by implication, be excluded from its operation and effect. For instance, if the statute in question enumerates the matters over which a court has jurisdiction, no other matters may be included. Similarly, where a statute forbids the performance of certain things only those things expressly mentioned are forbidden. So also, if the statute directs that certain acts shall be done in a specified manner, or by certain person, their performance in any other manner than that specified, or by any other person than one of those named, is impliedly prohibited.\" ", "588. It is interesting to note that in the Australian Constitution, where there is Article 49 , using language very similar to that of Article 105(3) of our Constitution, there is also a separate but differently cast Article 47 of the Australian Constitution corresponding to Article 329(b) of our Constitution. This article runs as follows : ", "\" Article 47. Unit the otherwise provides, any question respecting the qualification of a senator or of a member of , or respecting a vacancy in either of the , any question of a disputed election to either , shall be determined by the in which the question arises.\" ", "589. What is separately, expressly, and especially provided for by Article 329 (b) must necessarily fall outside the purview of Article 105(3) on the principle stated above. Moreover, Article 105(3) contained a temporary provision until other provision was made by in that behalf. Appropriate provision were enacted by the Act of 1951 in compliance with Article 329(b) because that was the proper article for it. It would be idle to contend that these provisions suddenly lapsed or ceased to exist as soon as took up consideration of the issues and the grounds of the decision on them by to which reference is made in Article 329A(4 ), could only be a law-making power and not any other power which could conceivably fall under Article 105 , Sub- Article (3). Nevertheless, it was suggested, by copious references to the origin of the power of to decide disputs relating to elections, that such a power exits in each of our parliment as its inherent power. Such ", "590. The reason why itself saw the need for entrusting to a rota of judges, the jurisdiction at one time exercised by it directly to determine its election disputes, is found thus stated by , quoting \"Parliamentary Practice and Procedure\"(at pp. 153-155) : ", "\"For a considerable time after the had obtained this jurisdiction, controverted elections were tried by committees specially nominated, composed of privy councillors and burgesses, well qualified for the duties entrusted to them. But after 1672, it became an open committee, in which all who came had voices, and at length a hearing at the bar of the was considered preferable to an inquiry by a committee. Here again, to use the words of Sir ,\" ", "the partiality and injustice of the judges was soon notorious. Parties tried their strength........ the friends of rival candidates canvassed and maneuvered, and seats corruptly gained, were as corruptly protected or voted away. Such were the results of the usurpation of judicial functions by a popular body \". ", "In order to remedy, if possible, these unquestionable evils, the statute 10 Geo. III c. 16, called from its author the Grenville Act, was passed in 1770, and the trial of election petitions transferred to a select committee of thirteen members, which it was thought would be 'a court independent of the , though composed of its own members'. For a time there was a marked improvement in the decision of controverted elections.'But too soon it became evident that corruption and party spirit had not been overcome. Crowds now attended the ballot, as they had previously come to the vote.......... not to secure justice, but, to aid their own political friends.' The party, whether of the petitioner or sitting member, which attended in the greatest number inevitably had the numerical majority of names drawn for the committee, and from this list, the petitioner and sitting member struck out alternately one name until the committee was reduced to thirteen : the majority of the house was necessarily a majority of theBy these means the majority of the continued, with less directness and certainty, and perhaps with less open scandal, to nominate their own members, as they had done before the Grenville Act. And for half a century, this system with slight variations of procedure was suffered to prevail. In 1939, however, the ballot was at length superseded by Sir Act, committees were reduced to six members, and nominated by an impartial body..... . The same principle of selection was adhered to in later Acts, with additional securities for impartiality, and the committee was finally reduced to five members. The evil was thus greatly diminished, but still the sinister influence of party was not wholly overcome. In the nomination of election committees, one party or the other necessarily had a majority of one, and though these tribunals undoudtedly became far more able and judicial, their constitution and proceedings often exposed them to imputation of political bias. ", "At length by the statute 31 & 32 Vict. c. 125, the trial of election petitions was transferred to certain of the puisne judges at , who selected annually to form a rota for this specific purpose, and who inquire upon the spot in open court into the allegations of a petitioner, either claiming a seat, or alleging an undue return or election. The decision of the judge, who has power to reserve his judgment until he has consulted the Common Pleas division of , in which these proceedings are instituted, is final to all intents and purposes; being bound to\" ", "give the necessary directions for confirming or altering the returns or for issuing a writ for a new election, or carrying such determination into execution as circumstances may require \". And this abstract of the proceedings at elections of knights, citizens, and burgesses, concludes our inquiries into the laws and customs more peculiarly relative to .\" ", "591. I do not think that it is possible to contend, by resorting to some concept of a succession to the powers of the medieval \"\" in England, that a judicial power also devolved upon our through , mentioned in Section 8 of the Indian Independence Act of 1947. As already indicated by me, was invested with law-making and not judicial powers. Whatever judicial power may have been possessed once by English King, sitting in , constituting the highest Court of the realm in medieval England, have devolved solely on as the final court of appeal in England.\"King in \", had ceased to exercise judicial powers in any other way long before 1950. And, had certainly the \"King in Parliment\" with the possible exception of the power to punish for its contempts. I use the qualifying word \"possible\" because the more correct view of it today may be that this power is also, as it is consid ", "592. In Parliamentary Practice (18th Edn.), after citing the opinions of judges, to whom a reference was made by in 's case (1451), that \"Lex Parliamenti\" seemed something as strange and peculiar as foreign law is for common law courts, it was explained (at page 187) : ", "\"These views belonged to a time when the distinction between the judicial and legislative function of was undrawn or only beginning to be drawn, and when the separation of the Lords from the was much less complete than it was in the seventeenth century. Views about the High Court of and its power which were becoming antiquated in the time of , continued to be repeated far into the eighteenth century, although after the Restoration principles began to be laid down which were more in accord with the facts of the modern Constitution. But much confusion remained which was not diminished by the use of the phrase 'privilege of '. This only means a body of rights common to both houses, but it suggests joint action (or enforcement) by both , as in legislation, whereas from case in reign, in 1543 each enforced its own privileges separately.These notions arise from this confusion of thought. ", "1. That the , being inferior to , cannot call in question the decision of either on a matter or privilege. ", "2. That the lex et consuetudo Parliamenti is a separate law, and therefore unknown to the courts. ", "3. That a resolution of either declaratory of privilege is a judicial precedent binding on the courts.\" ", "593. The confusions mentioned above misled some people in this country, due to the provisions of Article 194(3) of our Constitution, on the question whether had not only the power to punish a citizen for contempt but also to exercise what is really a judicial power to interpret and to determine the ambit of its own jurisdiction. , C.J., speaking for this in Special Reference No. 1 of 1964 (supra), rejected this claim and explained the English law on the subject. The learned Chief Justice pointed out the incidental character of any claim to a power, privilege, or immunity which could be covered by Article 194(3 ), a provision identically similar to Article 105(3). He pointed out that the only exception to this rule was the power to punish for its own contempt which, since the decision of in v. , could be thought of as a power of even acquired as a kind of \"inheritance\" from the powers once possessed by the High \"I do not think that was itself ever a court. The history of that does not support such a contention.\" ", "The result is similar to that in England where courts do determine the orbit of a claim to a power as a parliamentary preserve, on the facts of a case, although, once it is established that the claim is to a power confined to its proper sphere, they will not decide a mere question of its proper exercise. ", "594. Whatever view one may take of any other powers of , by reason of Article 105(3) of the Constitution, I am unable to see how exercise of the jurisdiction to determine an election dispute, which was, in accordance with Article 329(b ), already vested in by the Act of 1951 for all elections to , could not only be taken away by a constitutional amendment, purporting to repeal retrospectively the provisions of the Act of 1951, a piece of ordinary legislation, in their application to a particular class of cases, but at the same time, making a declaration given of the rights of the parties to a judgment, without first performing a judicial function also which was not included in the \"constituent\" or any other law-making power. ", "595. The question was not clearly raised before us whether a constitutional amendment could partially repeal the provisions of an ordinary piece of legislation, that is to say, the Act of 1951, in so far as its application to a certain class of cases is concerned. One of the submissions of the learned Counsel for the election-petitioner, however, was that, inasmuch as the Constitution lays down the norms to which ordinary legislation must conform, its proper sphere of operation is different from that ordinary legislation which takes place under the provisions of Articles 245 to 255 of the Constitution. The argument seemed to be, that, if ordinary law- making and Constitution-making took place in different orbits or on different planes of law-making power what could be done by one method was necessarily prohibited by the other. Learned Counsel relied upon a number of passages from the judgment in case (supra), and, in particular, on what , J. (as he then was) said (at p. 386) : ( p. ", "\"The constituent power is sui generis. The majority view in Case that Article 13(2) prevails over Article 368 was on the basis that there was no distinction between constituent and legislative power and an amendment of the Constitution was law and that such law attracted the opening words of Article 245 which in its turn attracted the provisions of Article 13(2). took notice of the two conflicting views which had been taken of the unamended Article 368 , took notice of the fact that the prepondering judicial opinion, namely, the decision in case, Case and the minority views of five learned Judges in case were in favour of the view that Article 368 contained the power of amendment and that power was the constituent power to change the fundamental law, that is to say, the Constitution and is distinct from ordinary legislative power. So long as this distinction is kept in mind will have the power under Article 368 to amend the Constitution ", "596. On the other hand, learned Counsel defending the Thirty-ninth Amendment relied on a number of passages from various judgments, including mine, in case (supra), indicating that at least the minority view there was that the power of amendment contained in Article 368 , was only limited by the procedure laid down in Article 368(2) of the Constitution and nothing else. It is true that this is what was emphasized by several learned judges, including myself, in dealing with a case where the real question was whether the constituent power embraced an amendment of the Constitution in such a way as to take away fundamental rights. But, neither the question whether \"constituent power\" itself contained judicial power within its fold nor the question whether \"constituent power\" operated on a plane or in a sphere which excluded altogether what could be done through ordinary legislation were under consideration in case (supra). Some passages were citied from my judgment in th ", "597. It could be and has been argued, not without force, that there are no legal limitations upon the subject-matter which may be considered fit for inclusion or incorporation in a Constitution. This is left to the good sense of the Constitution-makers. Constitutions differ greatly in this respect (See : 's \"Modern Constitutions\" pp. 49 to 51). What may be the ideal, from this point of view, is not always the actual. Reference was also made in support of this submission to on \"Constitutional Law\"(1939 Edn., p. 10). It is not necessary to pursue this question any further here. ", "598. I had said, in case (supra) after dealing with amending power in Article 368 , on the assumption that it was an exercise of a \"sovereign power\"(at p. 870) :\" ", "No doubt the judicial organ has to decide the question of the limits of a sovereign authority as well as that of other authorities in cases of dispute. But, when these authorities act within these limits, it cannot interfere. ", "\"In other words, I look upon a \"sovereign power\" itself, under the Constitution, as limited by the supremacy of the Constitution. ", "599. If the constitutional provisions compel us to hold, as think they do, that no form of judicial or quasi-judicial power is included in the \"constituent power\" contained in Article 368 of the Constitution, no further question need really be considered by us if we were to hold that the insertion of clause (4) in Article 329A necessarily involved, as a condition precedent to the making of the declaration found at the end of it, the performance of a quasi-judicial or judicial function. But, I do not think that we could go so far as that. The Act of 1951, enacted under the provisions of Article 329(b) of the constitution provided a procedure which could not be circumvented. This procedure was certainly applicable until August 10, 1975 when the Thirty-ninth Amendment received Presidential assent, rights of appeal under Section 116-A of the Act having been invoked by the original respondent as well as by the election-petitioner, and the operation of the High court's order having been suspended, the position was ", "600. At one stage, Counsel supporting the Thirty-ninth Amendment said that the norms of the Act of 1951, together with the amendment of the Act in 1974 and the very recent ones of 1975, must have been present in the minds of members of and applied to the facts of the case. Such a contention, apart from overlooking the effect of the bar of Article 329(b ), which operated against the case being taking up in directly until at lest August 10, 1975, just as Section 107 of the British Representation of People Act, 1949, operates against the adoption of such a course in England, overlooked the legal effect of the deeming provision which, if valid, would repel such a submission of counsel supporting the Thirty-ninth Amendment. The deeming provision appeared to be quite sweeping. It said :\" ", "No law made by before the commencement of the Constitution (Thirty-ninth Amendment) Act, in so far as it relates to election petitions and matters connected therewith, shall apply or shall be ", "601. The effect of such a provision is thus stated, in the oft-quoted passage from v. : ", "\"If you are bidden to treat an imaginary state of affairs as real, you must surely, unless prohibited from doing so, also imagine as real the consequences and incidents which, if the putative state of affairs had in fact existed must inevitably have flowed from or accompanied it......... The statute says that you must imagine a certain state of affairs; does not say that having done so, you must cause or permit your imagination to boggle when it comes to the inevitable corollaries of that state of affairs\" ", ". ", "602. When the effect of Article 329 (b) and of the deeming provision was pointed out to learned Counsel supporting the fourth clause of Article 329A , they took up the position that must have applied its won norms. We, however, do not know at all and cannot guess what matters were considered or the norms applied by . No speeches made in on the proposed Thirty-ninth Amendment were cited before us by either side. We only know that the Objects and Reasons of the Thirty-ninth Amendment contain the following statements to show us why Article 329A (4) was believed to be necessary : ", "\" Article 71 of the Constitution provides that disputes arising out of the election of the President or Vice-President shall be decided by . The same article provides that matters relating to their election shall be regulated by a parliamentary law. So far as the Prime Minister and the Speaker are concerned, matters relating to their election are regulated by the provisions of the Representation of the People Act , 1951. Under this Act has jurisdiction to try an election petition presented against either of them. ", "2. The President, the Vice-President, the Prime Minister and the Speaker are holders of high offices. The President is not answerable to a court of law for anything done, while in office, in the exercise of his powers. A fortiori matters relating to his election should not be brought before a court of law but should be entrusted to a forum other than a court. The same reasoning applies equally to the incumbents of the office of Vice- President, Prime Minister and Speaker. It is accordingly proposed to provide that disputes relating to the election of the President and Vice- President shall be determined by a forum as may be determined by a parliamentary law. Similar provision is proposed to be made in the case of the election to either or, as the case may be, to the House of the people of a person holding the office of Prime Minister or the Speaker. It is further proposed to render pending proceedings in respect of such election under the existing law null and void. The bill also provides t ", "603. I think that this Statement of Objects and Reasons and other reasons mentioned above by me lend support to the submission, to which Mr. confined himself whilst other counsel supporting the validity of Article 329A (4) offered it only as an alternative submission. This was that the whole procedure adopted and needed being a law-making procedure and nothing more there was no need to look for norms or for law applied as no judicial or quasi-judicial proceeding was involved. This approach certainly avoids the extraordinary anomalies and results involved in the proposition that \"constituent power\" embraces some indefinable or \"unbroken\" power to override laws and to withdraw and decide all disputes, particularly in election matters, in itself. As already indicated, there is no provision anywhere for the exercise of overriding judicial or quasi- judicial powers by . It is difficult to conceive a case being considered by and the ratifying as a case on trial. ", "604. If Article 329A (4) constituted only a piece of purported law-making, the next question, which deserves very serious consideration by us, is whether such purported law-making is not fully covered by the undoubted law-making power of to make law prospectively as well as retrospectively, inter alia, to get rid of the legal effect or result of a judgment considered erroneous by it or to retrospectively validate an election it considers valid whatever may be its reasons for reaching this conclusion. I will answer this question after considering the relevant case law cited on the subject. ", "605. A number of cases have been cited before us : some on retrospective validation of taxing provisions, by removing defects, others on removal of the basis of or grounds of decisions given by courts making their judgments ineffective, others affecting the jurisdiction of courts in case pending, either in the original courts or in courts of appeal, so as to render proceedings infructuous, and still others curing legally defective appointments or elections. It is not necessary to discuss these cases separately and individually as the principles laid down there are well recognised. I will be content with mentioning the cases cited. They were : M. P. V. Sundararamier & Co. v. State of A. P. Vinod Kumar v. State of H. P.; v. ; ; ; v. Authorised Officer, Land Reforms; ; M/s. v. State of U. P.; ", "606. Cases were also cited where rights having been altered during the pendency of proceedings, courts had to give effect to the rights as altered, and judgments already given on the strength of the previous law had ceased to have a binding force as res judicata between parties or had to be set aside where appeals against them were pending. These were : State of U. P. v. ; ; .; .; ; ; . ", "607. Cases were also cited of the exercise of constitutional power of amendment, by placing Acts in the Ninth Schedule, under the provisions of Article 31B of the Constitution, such as , (supra) so that Acts so included in the Ninth Schedule were immune from attack on the ground of alleged violation of any fundamental rights. It is not necessary to cite them as this is now a well recognised constitutional device whose validity has been upheld by this Court in Case (supra). ", "608. Our attention was especially invited to passages from (supra), where it was said (at page 54) :\" ", "In our opinion no useful purpose will be served by referring to the clear demarcation between the judicial powers and legislative powers in America and attempt to engraft the said principle in the working of our Constitution. This development of the law, as pointed our in was due to historical reasons. ", "\"609. After that, the following passage from he judgment of , J. in case (supra) was quoted (at page 55) :\" ", " of the United State, under the leadership of Chief Justice , assumed the power to declare any law unconstitutional on the ground of its not being in 'due process of law', ..... It is thus that established its own supremacy over the and the . In India the position of the is somewhere in between the in England and the United States. While in the main leaving our and the State supreme in their respective legislative fields, our Constitution has, by some of the articles, pur upon the legislature certain specified limitations.... Our Constitution, unlike the English Constitution, recognises the court's supremacy over the legislative authority, but such supremacy is a very limited one, for it is confined to the field where the legislative power is circumscribed by limitations put upon it by the Constitution itself. Within this restricted field the may, on a scrutiny of the law made by the , decla ", "610. In case (supra), the following passage from Willoughby's Constitution of the United States, Second Edition, Vol. 3, was also cited : ", "\"If the would prescribe a different rule for the future from that which the courts enforce, it must be done by statute, and cannot be done by a mandate to the courts which leaves the law unchanged, but seeks to compel the courts to construe and apply it not according to the judicial, but according to the legislative judgment.... If the cannot thus indirectly control the action of the courts, by requiring of them a construction of the law according to its own views, it is very plain it cannot do so directly, by setting aside their judgments, compelling them to grant new trials, ordering the discharge of offenders, or directing what particular steps shall be taken in the progress of a judicial inquiry.\" ", "611. 's statement of law in the United States of America showing that retroactive legislation which does not impair vested or substantial rights or constitutional prohibitions, is permissible and his conclusion, relying on 's \"Constitutional Limitations\", was also quoted : ", "\"The does, or may, prescribe the rules under which the judicial power is exercised by the courts, and in doing so it may dispense with any of those formalities which are not essential to the jurisdiction of the court; and whatever it may dispense with by statute anterior to the proceedings, we believe it may also dispense with by statute after the proceedings have been taken, if the court has failed to observe any of those formalities. But it would not be competent for the to authorize a court to proceed and adjudicate upon the rights of parties, without giving them an opportunity to be heard before it and, for the same reason it would be incompetent for it, by retrospective legislation, to make valid any proceedings which had been had in the courts, but which were void for want of jurisdiction over the parties.\" ", "612. In case (supra) an argument, based on some observations in was that the provisions of an amending Act amounted to passing a decree. But, this repelled this argument relying on principles laid down in v. (supra) : ", "\"If what has been done in Legislation, within the general scope of the affirmative words which give the power, and if it violates no express condition or restriction by which that power is limited (in which category would, of course, be included any Act of the Imperial Parliament at variance with it), it is not for any court of justice to inquire further, or to enlarge constructively those conditions and restrictions.\" ", "613. A case strongly relied upon by learned Counsel supporting the validity of Article 329(4) was : . In this case, decided by five Judges of this Court, there was unanimity not he conclusion that had power to retrospectively remove the disqualification of a candidate. The following quotation from the judgment (at page 851) shows the reasoning adopted ( p. 280, paras 37-40) : ", "\"Mr. , learned Counsel for the respondent, contends that was not competent 'to declare retrospectively' under Article 191(1) (a) of the Constitution. It seems to us that there is no force in this contention. It has been held in numerous cases by this Court that the State Legislatures and can legislate retrospectively subject to the provisions of the Constitution. Apart from the question of fundamental rights, no express restriction has been placed on the power of State, and were are unable to imply, in the context, any restriction. Practice of the British does not oblige us to place any implied restriction. We notice that the British in one case validated election : Treatise on the Law, Privileges, Proceeding & Usage of - Seventeenth Edition, (1964).'After the general election of 1945 it was found that the persons elected for the Coatbridge Division of Lanark and the Springbourn Division of Glasgow were disqualified at the time of their election because they were members of tribunals appointed by the Minister under the Rent of Furnished Houses Control (Scotland) Act, 1943, which entitled them to a small fee in respect of attendance at a Tribunal. reported that the disqualification was incurred inadvertently, and in accordance with their recommendation the Coatbridge and Springbourn Elections (Validation) Bill was introduced to validate the irregular elections [H. C. Deb (1945-46) 414, c. 564-6]. See also H. C. 3 (1945-46), ibid, 71 (1945-46) and ibid. 92 (1945-46).' We have also noticed two earlier instances of retrospective legislation, e.g. The House of Commons (Disqualification) Act, 1813 (Halsbury's Statutes of England p. 467) and Section 2 of the Re-election of Ministers Act, 1919 (ibid. p. 515). ", "Great stress was laid on the word 'declared' in Article 191 (1) (a ), but we are unable to imply any limitation on the powers of the from this word. Declaration can be made effective as from an earlier date. ", "The apprehension that it may not be a healthy practice and this power might be abused in a particular case are again no grounds for limiting the powers of .\" ", "614. Another case on which a great deal of reliance was placed by Mr. , was the case of the validation of the elections of , Esquire, and Sir , Knight, by . Here, the two gentlemen named above were \"discharged, freed and indemnified from all penal consequences whatsoever incurred by them respectively by sitting or voting as members of while holding their said offices\". It was also declared that they\" shall be deemed not to have been incapable of being elected members of , or to have been or to be incapable of sitting or voting as members thereof, by reason only of having at any time before the passing of this Act held office :\" ", "(a) in the case of the said , as Director appointed by the Minister of Works of Scottish Slate Industries Limited, ", "(b) in the case of the said Sir , as Approved Auditor appointed under the Industrial and Provident Societies Act, 1893, and the Friendly Societies Act, 1896. ", "\"615. Learned Counsel for the election-petitioner replied that it is noticeable that no English case could be cited where any attempt was made by to circumvent Section 107 of the Representation of the People Act, which lays down :\" ", "Section 107 . Method of questioning ary election. -(1) No ary election and no return of shall be questioned except by a petition complaining of an undue election or undue return (hereinafter referred to as parliamentary election petition) presented in accordance with this Part of this Act. ", "(2) a petition complaining of no return shall be deemed to be a parliamentary election petition and may make such order thereon as they think expedient for compelling a return to be made or may allow the petition to be heard by an election court as provided with respect to ordinary election petitions. ", "\"616. He also submitted that, in none of the cases of validation, was any election dispute shown to be pending. No judgment was actually set aside in contravention of the binding constitutionally prescribed procedure to decide such disputes. He submitted that, in the case of an election to a parliamentary seat in this country this could be done by itself only after first repealing the application of the 1951 Act and amending Article 329(b) in such a way as to vest the power in itself to decide the dispute. ", "617. Learned Counsel for the election-petitioner relied upon the following statement in the American Jurisprudence, 2nd Edn. Vol. 46, at page 318 :\" ", "The general rule is that the may not destroy, annul, set aside, vacate, reserve, modify, or impair the final judgment of a court of competent jurisdiction, so as to take away private rights which have become vested by the judgment. A statute attempting to do so has been held unconstitutional as an attempt on the part of the is not only prohibited from reopening cases previously decided by the courts, but is also forbidden to affect the inherent attributes of a judgment. That the statute is under the guise of an act affecting remedies does not alter the rule. ", "\"618. On the other hand, learned Counsel supporting the validity of Article 329A (4) relied on the following passage :\" ", "It is worthy of notice, however, that there are cases in which judgments requiring acts to be done in the future may validly be affected by subsequent legislation making illegal that which the judgment found to be legal, or making legal that which the judgment found to be illegal.\" ", "They also pointed out : ", "\" With respect to legislative interference with a judgment, a distinction has been made between public and private rights under which distinction a statute may be valid even though it renders ineffective a judgment concerning a public right. Even after a public right has been established by the judgment of the court, it may be annulled by subsequent legislation. ", "\"619. It is contended that the election of a candidate is the result of the exercise of their rights of voting by the electorate. An election results from public action and produces a \"public right\" inasmuch as the electorate and the public become interested parties acquiring the right to be represented by the elected candidate. The right to challenge that election is a statutory right. What the statute gives can be taken away by statute. The grounds for challenging the election could also be altered. No one, it was urged, could be herd to say that he had any vested or inherent right to challenge and election. It was contended that once the applicability of all law previous to the Thirty-ninth Amendment to the class dealt with by Article 329A (4) was removed retrospectively, the resulting legislative declaration followed automatically even if it had not been inserted. Its inclusion was a superfluity. Article 329A (4) was said to be merely incidental and consequential to what was done by earlier clauses (1) to ", "620. Learned Counsel for the election-petitioner relied on Don v. , where considered the validity of the Criminal Law Special amendment Act of 1962, passed by , which had purported to legalise ex-post facto the detention of persons for having committed offenses against the State, by widening the class of offenses for which trial, without jury, by nominated judges could be ordered. The scope of the offence of waging war against the was widened and new powers to deal with offenders were given and additional penalties were prescribed. It was held that, although, no fundamental principles of justice could be said to have been violated by the Act, yet, the Act of 1962 and an amending Act of 1965, were invalid on the ground summarized in the headnotes as follows (at p. 260) :\" ", "That the Act s, directed as they were to the trial of particular prisoners charged with particular offenses on a particular occasion, involved a usurpation and infringement by the of judicial powers inconsistent with the written Constitution of Ceylon, which, while not in terms vesting judicial functions in the , manifested an intention to secure in the a freedom from political, legislative and executive control, land, in effect, left untouched the judicial system established by the Character of Justice, 1833. The silence of the Constitution as to the vesting of judicial power was consistent with its remaining where it was and inconsistent with any intention that it should pass to or be shared by the or the . The Act s were accordingly ultra vires and void, and the convictions could not stand. ", "\"621. If the constituent bodies, taken separately or together, could be legally sovereign, in the same way as is, the constitutional validity of no amendment could be called in question before us. But, as it is well established that it is the Constitution and not the constituent power which is supreme here in the sense that the constitutionality of the Constitution cannot be called in question before us, but exercise of the constituent power can be, we have to judge the validity of exercise of constituent power by testing it on the anvil of constitutional provision. According to the majority view in case (supra), we can find the test primarily in the preamble to our Constitution. ", "622. A point emphasized by (See : \"Nature & Sources of Law\" p. ", "96) is that unless and until courts have declared and recognised a law as enforceable it is not law at all. (See : \"General Theory of Law & State\", p. 150) finds 's views to be extreme. Courts, however, have to test the legality of laws, whether purporting to be ordinary or constitutional, by the norms laid down in the Constitution. This follows from the supremacy of the Constitution. I mention this here in answer to one of the questions set out much earlier : Does the \"basic structure\" of the Constitution test only the validity of a constitutional amendment or also ordinary laws? I think it does both because ordinary law-making itself cannot go beyond the range of constituent power. At this stage, we are only concerned with a purported constitutional amendment. According to the majority view in case (supra) the preamble furnishes the yardstick to be applied even to constitutional amendments. ", "623. Learned Counsel for the election-petitioner has strongly relied upon the very first purpose of the Constitution stated in the preamble to be Justice (with a capital \"J\") which includes \"political justice\". His contention is that, if a majority party is to virtually act as the judge in an election dispute between itself and minority parties whose cause, according to the learned Counsel, the election-petitioner represents, it would be a plain denial of \"political justice.\" I do not know why this question should be termed as one of \"political justice\" and not of plain and simple elementary justice except that the contending parties represent political causes which are, for purposes of plain and simple justice with which we are really concerned, irrelevant. We are not asked to judge a political issue directly as to who should be the Prime Minister of this country. We are only asked to hold that even a constitutional amendment, when made by members of a majority party to enforce their own views of what is p ", "624. What was sought to be done by the constitutional amendment may be politically very justifiable. The question before us, however, is whether it is also legally justifiable. Here, wears back again in the realm of basic principles of justice. We are not to decide a political question here at all. But, we have to decide legal questions even if they have, as many legal issues have, political consequences and repercussions which we cannot entirely ignore. Perhaps we have to go back to v. (supra), were Chief Justice said (at p. 162) :\" ", "The very essence of civil liberty consists in the right of every individual to claim the protection of the laws, whenever he receives an injury. One of the first duties of government is to afford that protection. In Great Britain the King himself is used in the respectful form of a petition, and he never fails to comply with the judgment of his court. ", "In the 3rd volume of his Commentaries, p. 23, states two cases in which a remedy is afforded by mere operation of law. ", "'In all other cases', he says it is a general and indisputable rule, that where there is a legal right, there is also a legal remedy by suit, or action at law, whenever that right is invaded'. ", "\"625. It is true that the right which the election-petitioner claims is a purely statutory right. The right to come to this Court under Section 116A of the Act of 1951 is also a creature of statute and can be taken away retrospectively. But, where this taking away also involves the taking away of the right to be heard by this Court on a grievance, whether justifiable or not, that a minority party is being oppressed by the majority, can we deny the spokesman of the minority even a right to be heard on merits? Such an issue is constitutional. Confession of our inability to resolve it judicial would be, according to learned Counsel for the election- petitioner, a denial of \"political justice\". This issue is extrinsic so far as the Act of 1951 is concerned. The election-petitioner has complained of the taking away of his right to be heard with a view to depriving him of \"political\" justice with an ulterior object and political motivation. I have dealt with the merits of the case to show that, from the legal aspect ection-petitioner's grievances could have any real legal foundations. I think that this is a basic consideration which must compel us, in the light of the principles laid down by us in case (supra), to hold that we must look into his grievances and determine, for ourselves, where his case stood on the law before it was amended. Our jurisdiction, at any rate, cannot be barred without creating the impression that what the election-petitioner calls \"political justice\" is being denied to him. ", "626. The question which arises now is : Was clause (4) of Article 329A , read with clauses (5) and (6), really meant to bar our jurisdiction to consider the grievances of the petitioner and to decide them, or, can they be so interpreted as to preserve this 's jurisdiction? ", "627. Broadly speaking, the election-petitioner has two heads of grievance : firstly, that the election of the original respondent is vitiated by corrupt practices which, as I have indicated, after considering the case set up by him and the evidence tendered and the law applicable, could not possibly succeed even under the law as it stood before the amendment; and, secondly, that our very jurisdiction to go into these grievances is sought to be debarred by clauses (4), (5) and (6) of Article 329A with the political object of stifling opposition, and, therefore, according to the election-petitioner, we must declare clause (4) and the connected clauses (5) and (6) of Article 329A to be invalid. Although, the first set of complaints is based upon the provisions of the Act of 1951, the second set arises because of impugned clauses of the Thirty-ninth Amendment. For the second set of grievances, the action complained of is that of the itself acting through its law-making organs. It is because of this interes ", "628. Indeed, so far as the original respondent is concerned, the effect of clauses (4), (5) and (6) of Article 329A would be, if we were to hold that they bar our jurisdiction to go into the merits of the appeals under Section 116A of the Act, that her grievance against the judgment under appeal also could not be gone into or dealt with. In other words, the original respondent would also be denied an opportunity of asserting her rights under the 1951 Act and of vindicating her stand in the case by showing that there was really no sustainable ground for the findings given by the learned Judge of against her. We would, therefore, be prevented from doing justice to her case as well if we were to accept the contention that the Thirty-ninth Amendment bars our jurisdiction to hear the appeals under Section 116A of the Act on merits. The total effect would be that justice would appear to be defeated even if, in fact, it is not so as a result of the alleged bar to our jurisdiction if it were held to b ", "629. It was also contended before us that we should not go at all into the merits of the case before us as it was a political matter. In other words, the \"political question\" doctrine was invoked in aid of the submission that we should voluntarily abstain from deciding a question of a \"political nature\". It is true that the \"political question doctrine\" has been sometimes invoked, in the past, by to abstain from taking a decision. In answer to this argument, learned Counsel for the election-petitioner cited before us from comments on the Constitution of the United States of America (Analysis and Interpretation by the Congressional Research Service - 1973, Edn., p. 665) that the \"political question\" doctrine is the result of a \"prudential\" attitude courts adopt when they find that their judgments may not be enforced. It was described there as\" ", "a way of avoiding a principled decision damaging to the or an expedient decision damaging to the principle\". It was also pointed out th \" Deciding whether a matter has in any measure been committed by the Constitution to another branch of government, or whether the action of that bench exceeds whatever authority has been committed, is itself a delicate exercise in constitutional interpretation, and is a responsibility of this as ultimate interpreter of the Constitution. ", "\"630. Learned Counsel for the election-petitioner also relied upon , where this Court said : (at p. 75) : (SCC p. 147, para 98).\" ", "The functions of the are classified as legislative, judicial and executive : the executive function is the residue which does not fall within the other two functions. Constitutional mechanism in a democratic policy does not contemplate existence of any function which may qua the citizens be designated as political and orders made in exercise whereof are not liable to be tested for their validity before the lawfully constituted courts , 's Laws of England, 3rd Edn., Vol. 7, Article 409 , at p. 192. ", "\"631. Learned Solicitor General also contended that we were passing through critical times when a state of Emergency had been declared. He submitted that the decision of the constituent authorities, in excluding a particular case from the jurisdiction of this , should be treated as an exercise of a very special power under very unusual conditions in which internal and external dangers, with which the country was surrounded, required that the position of the Prime Minister should be declared unequivocably unassailable so that the need for further examination of the question of her election to may not be raised anywhere else. This seems to be another form in which \"political question\" argument could be and was addressed to us. Undoubtedly, clause (4) of Article 329A could be said to have a political objective, in the context in which it was introduced, and we could perhaps take judicial notice of this context. Even if it was possible to go beyond the statement of objects and reasons and to hold ", "632. It is a well established canon of interpretation that, out of two possible interpretations of a provision, one which prevents it from becoming unconstitutional should be preferred if this is possible - ut res magis valeat quam pereat. It is true that the deeming provision seems to stand in the way of our examination of the merits of the case even though there is no direct provision taking away our jurisdiction to consider the merits of the appeals before us. It has, however, been repeatedly laid down that a deeming provision introducing a legal fiction must be confined to the context of it and cannot be given a larger effecti (See : v. ). , it was held by this Court that a legal fiction is created for some definite purposes and should not be extended beyond its legitimate field determined by its context. The some view has been expressed by this Court in other cases : C. I. T. v. ; C. I. T. v. , Mad ", "633. In Ex parte , In Re, , :\" ", "When a statute enacts that something shall be deemed to have been done, which in fact and in truth was not done, then the court is entitled and bound to ascertain for what purposes and between what persons the statutory fiction is to be resorted to? ", "\"In other words, we have to examine the context and the purpose of the legal fiction and confine its effects to these. ", "634. If the purpose of the clause (4) of Article 329A was purely to meet the political needs of the country and was only partly revealed by the policy underlying the statement of reason and objects it seems possible to contend that it was not intended at all to out the jurisdiction of the . Hence, Article 329A , clause (5) will not, so understood, bar the jurisdiction of the to hear and decide the appeals when it says that the appeal shall be disposed of in conformity with the provision of clause (4). ", "635. In the circumstances of this case, it would seem that conformity with the declaration embodied in Article 329A , clause (4) is possible, if we confine the meaning and effect of the deeming provision to what was needed only for the declaration to be given at the end of clause (4) by the constituent bodies, with a political object, and not for the purposes of affecting our jurisdiction which determines legal effects of what is sought to be done. Of course, the more natural interpretation would appear to be that the deeming provision should apply for \"all purposes\" including those for consideration of the appeals before us. But, if it is not possible to decide those appeals without giving a different meaning to the deeming provision, on which the final declaration in clause (4) rests, and clause (5) leaves us free to decide how we could conform with clause (4), need our jurisdiction to decide factual and legal issues judicially be said to be affected? If the fiction was only a logical step in the process of ", "636. For the reasons given above, I declare that Article 329A (4) does not stand in the way of the consideration of the appeals before us on merits under the Act of 1951 or the validity of the amendments of the Act. On a consideration of the merits of Appeals Nos. 887 and 909 of 1975. I have come to the conclusion, as indicated above, that Appeal No. 887 must be allowed and the Cross Appeal No. 909 of 1975 must fail. The result is that the judgment and orders passed by the learned Judge of on the election case are set aside, and, in such conformity with Article 329A , clause (4) as is possible for us I also declare the judgment and the findings contained in it to be void and of no effect whatsoever. It is not necessary for me to add that the order of the learned Judge, holding the original respondent disqualified from occupying her office, disappears ipso facto and it neither has nor will be deemed ever to have had any legal effect whatsoever. In the circumstances of the case, I think , (concurring). The election petition out of which these appeals arise involved the question of the validity of the election of Smt. to . In the General Parliamentary Elections of 1971, she was declared as the successful candidate from the Rae Bareli constituency in Uttar Pradesh. She won the election by a margin of 1, 11, 810 votes her nearest rival, . ", "638. , who was sponsored , filed an election petition under Section 80 read with Section 100 of the Representation of the People Act, 1951, to challenge the election of the successful candidate. Originally, the challenge was founded on numerous grounds but during the trial of the petition in , the challenge was limited to seven grounds. ", "639. A learned Single Judge of , , J., upheld the challenge on two grounds, rejecting the other grounds of challenge. That explains the cross-appeals. ", "640. held that the successful candidate was guilty of having committed two corrupt practices within the meaning of Section 123 (7) of the Representation of the People Act : firstly, she obtained the assistance of the gazetted officers of for furthering her election prospects; and secondly, she obtained the assistance of , a gazetted officer in holding the post of Officer on Special Duty in the Prime Minister's Secretariat, for furthering the same purpose. Acting under Section 8-A of the Act the learned Judge declared that the successful candidate would stand disqualified for a period of six years from June 12, 1975 being the date of the judgment. Aggrieved by this part of the judgment, Smt. has filed Appeal No. 887 of 1975. ", "641. The other five grounds of challenge were : (1) The successful candidate procured the assistance of the armed forces for arranging her flights by aeroplanes and helicopters; (2) Her election agent, , and others distributed clothes and liquor to induce the voters to vote for her; (3) She and her election agent made appeals to the religious symbol of cow and calf; (4) Her election agent and others procured vehicles for the free conveyance of voters to the polling stations; and (5) She and her election agent incurred or authorised expenditure in violation of Section 77(3) of the Act read with Rule 90 of the Conduct of Elections Rules, 1961. These grounds having been rejected by , the defeated candidate has filed Appeal No. 909 of 1975. The first two grounds were given up in appeal for the reason that the evidence on record was not likely to be accepted by this Court in proof thereof. ", "642. The defeated candidate did not lead evidence in to show that any part of the expenditure in excess of the permissible limit of Rs. 35, 000 was incurred by the successful candidate or her election agent. His contention was that the expenditure incurred for her election by the political party which had sponsored her candidature, the (R), was liable to be included in the expenses incurred or authorised by her. This contention was founded on a decision rendered by a Division Bench of this Court on October 3, 1974, in . ", "643. On October 19, 1974, the President of India promulgated.\"The Representation of the People (Amendment) Ordinance, 1974\" providing that :\" ", "Notwithstanding any judgment, order or decision of any court to the contrary, any expenditure incurred or authorized in connection with the election of a candidate by a political party or by any other association or body of persons or by any individual (other than the candidate or his election agent) shall not be deemed to be, and shall not ever be deemed to have been, expenditure in connection with the election incurred or authorized by the candidate or by his election incurred or authorized by the candidate or by his election agent..... ", "\"This provision was added by the ordinance by way of an explanation to Section 77(1) of the Representation of the People Act, 1951. It expressly excepted from its operation decisions of voiding an election before the commencement of the ordinance. fell outside the ordinance. It also excepted similar decisions of provided that they had become final or unappealable. The ordinance was replaced by the Representation of the People (Amendment) Act , 58 of 1974, which was brought into force retrospectively from October 19, 1974. ", "644. The defeated candidate filed Writ Petition No. 3761 of 1975 in to challenge the constitutional validity of the ordinance and the Act of 1974. In view of his finding that the total amount of expenditure incurred or authorized by the successful candidate or her election agent, together with the amount proved to have been incurred by the political party or in concussion with her election did not exceed the prescribed limit, the learned Judge thought it unnecessary to inquire into the constitutionality of the ordinance and the Act of 1974. He, therefore, dismissed the writ petition. An appeal was filed to of from the aforesaid order but, by consent of parties, this Court decided to hear the points involved in the writ petition and in the appeal therefrom. ", "645. During the pendency of these cross-appeals, the passed the Election Laws (Amendments) Act, 1975, 40 of 1975, which came into force on August 6, 1975. This Act , if valid, virtually seals the controversy into he appeal filed in this Court by the successful candidate from the decision of . It also takes care of a considerable gamut of the appeal filed in this Court by the defeated candidate. It substitutes a new Section 8-A in the Representation of the People Act , 1951 empowering the President to decide whether a person found guilty of corrupt practice shall be disqualified and if so, for what period. By Section 6 , it amends Section 77 of the Act of 1951 making pre-nomination expenses a matter of irrelevant consideration. It declares that the expenditure incurred by a government servant in the discharge of his official duty in connection with any arrangements or facilities and such arrangements or facilities shall not be deemed to be expenditure or assistance incurred or rendere ", "646. The amendments brought about by Act 58 of 1974 and Act 40 of 1975 have an incisive impact on the cross-appeals but their edge was blunted by the Constitution (Thirty-ninth Amendment) Act, 1975 which came into force on August 10, 1975. The Thirty-ninth Amendment introduces two new articles in the Constitution : Article 71 and 329A; and it puts in the Ninth Schedule three Acts : (i) The Representation of the People Act , 43 of 1951; (ii) The Representation of the People (Amendment) Act , 58 of 1974; and (iii) The Election Laws (Amendments) Act, 1975, 40 of 1975. The new Article 71 which replaces its precursor empowers the to pass laws regulating the elections of the President and the Vice-President, including the making of provision for the decision of disputes relating to their election. Article 329A has six clauses out of which the first three deal with the future election to the of persons holding the office of Prime Minister of Speaker at the time of the election or who are appointed to these o ", "647. At first flush, what remains to be decided judicially in face of the Thirty-ninth Amendment? As an exercise of constituent power, the Thirty- ninth Amendment must reign supreme. The political sovereign having reposed its trust in the legal sovereign, the doings of have an aura of sanctity that legal ingenuity may be powerless to penetrate. But that is an uninformed approach to field strewn with various shades of legal landmarks. ", "648. While repelling the challenge to the First Constitutional Amendment which was passed in June 1951, this held in , that the power of amendment conferred by Article 368 was not subject to any limitations, express or implied and that fundamental rights were within the sweep of the amending power. The Seventeenth Constitutional amendment passed in June 1964 was similarly upheld by a majority decision of this in , which took the view that the fundamental rights were not intended by the farmers of the Constitution to be finally and immutably settled when the Constitution was passed. But the Seventeenth Amendment came to be challenged once again in . By a majority of 6 : 5, this held that the Seventeenth Amendment was ultra vires the 's power to amend the Constitution. Five out of the six learned Judges held that Article 368 did not confer any power ", "649. The decision in case (supra) raised a debate of national dimensions as the 's power to amend the Constitution so as to abridge or take away the fundamental rights virtually became a dead letter. Under the majority judgment, alone, called by virtue of a law to be passed under entry 97 of List I, could abridge or take away the fundamental rights. The , in a resolve to re-affirm its powers, passed the Constitution (Twenty-fourth Amendment) Act on November 5, 1971. By the Twenty-fourth Amendment, the amended Articles 13 and 368 of the Constitution so as to provide that nothing contained in Article 13 shall apply to any amendment of the Constitution made under Article 368 and that notwithstanding anything in the Constitution, may, in the exercise of its constituent power, amend by way of addition, variation or repeal any provision of the Constitution in accordance with he procedure laid down in Article 368. As an instance of the ", "650. A Bench of thirteen Judges of this Court sat to consider the constitutionality of the Twenty-fourth, Twenty-fifth and Twenty-ninth Amendments. The eleven judgments delivered in that case are reported in v. State of Keral, commonly known as the Fundamental Rights case. case (supra) stood overruled as a result of the decision in this case. But six learned Judges out of the thirteen (, , and , , , and , .) accepted the contention of the petitioners that though Article 368 conferred the power to amend the Constitution, and therefore, Article 368 did not confer power to amend the Constitution so as to damage or destroy the essential elements or basic features of the Constitution, could not therefore be abrogated or emasculated in the exercise of the power conferred by Article 368 , though a reasonable abridgment of those rights could be effected in the public interest. Brother , J. found it difficult, in face of the c ", "651. These appeals have therefore to be decided in the light of the principle emerging from the majority decision in the Fundamental Rights case that Article 368 does not confer power on the to alter the basic sel appearing on both sides have taken many forms and shapes but they ultimately converge on the central theme of basic structure. ", "652. I would like first to deal with the constitutional validity of the Thirty-ninth Amendment. On that question, the arguments of Mr. , who appears for , may be summed up thus : (i) The Thirty-ninth Amendment affects the basic structure or framework or the institutional pattern adopted by the tion and is therefore beyond the amending power conferred by Article 368. It destroys the identity of the tion. (ii) Separation of powers is a basic feature of the tion and therefore every dispute involving the adjudication of legal rights must be left to the decision of the . Clause (4) of Article 329A introduced by the Thirty-ninth Amendment takes away that jurisdiction and is therefore void. (iii) The function of the legislature is to legislate and not decide private disputes. In the instant case has transgressed its constituent function by adjudicating upon a private dispute. (iv) Democracy is an essential feature of the by revolutionary methods. The question is whether it is permissible to the to use the legitimacy of constitutional provisions for effecting revolutionary changes. (viii) The constituent power partakes of legislative power land can only be exercised within the highest ambit of the latter power. Therefore, even with a two-third majority, the constituent body cannot exercise executive or judicial power. For example, the power to appoint or dismiss a government servant or the power to declare war which are executive powers cannot be exercised by . Similarly, it cannot, in the guise of amending the tion, provide that an accused arraigned before a criminal court shall be acquitted and shall be deemed to be innocent. The constituent body can make changes in the conditions of the exercise of judicial power but it cannot usurp that power; and lastly (ix) The question in the Fundamental Rights case was whether can, in the exercise of its power of amendment abridge ", "653. Learned Counsel appearing for and for Smt. did not dispute the contention that the appeals before us must be disposed of on the basis of the law laid down by the majority in the Fundamental Rights case. ", "654. The learned Attorney General contended that : (i) The majority decision in the Fundamental Rights case is not an authority for the proposition that there could be no free or fair elections without judicial review. The Constitutions and laws of several countries leave the decision of election disputes to the judgment of the Legislatures themselves. The history of the Representation of the People Act , 1951 as also various articles in our Constitution show that judicial review can be excluded in appropriate cases as a matter of policy. (ii) That validation of elections is a process well-known to democratic forms of Government. (iii) That a law may be constitutional even if it relates to single individual if on account of special reasons, the single individual could be treated as a class by himself. (iv) That it is clear from Articles 326 and 327 of the Constitution that the Constitution-makers thought that as a matter of high policy elections ought to be dealt with by the Constitution itself and not by order ", "655. The learned Solicitor-General who continued the unfinished arguments of the learned Attorney-General urged that (i) Article 14 is founded on a sound public policy recognised and followed in all civilised States. The exclusion of judicial review does not by itself mean the negation of equality. Article 31B which on the face of it denied equality to different sections of the community attained the ideal of economic justice by bringing about economic equality. Article 33 also shows that the demands of public problems may require the adjustment of fundamental rights for ensuring greater equality. (ii) What a Constitution should contain depends on what permanency is intended to be accorded to a particular provision included in the Constitution. (iii) Exclusion of judicial review is at least permissible in those fields where originally the Constitution did not provide for or contemplate judicial review. (iv) If the election law does not apply, as it ceases to apply by virtue of Article 329A (4 ), it is the fun ", "656. who appears for Smt. defended the Thirty- ninth Amendment by contending that : (i) The amendment follows the well- known pattern of all validation Acts by which the basis of judgments or orders of competent courts and tribunals is changed and the judgments and orders are made ineffective. (ii) The effect of validation is to change the law so as to alter the basis of any judgment, which might have been given on the basis of old law and thus to make the judgment in-effective. (iii) A formal declaration that the judgment rendered under the old Act is void, is not necessary. If the matter is pending in appeal, the appellate Court has to give effect to the altered law and reverse the judgment. If the matter is not pending in appeal, then the judgment ceases to be operative and binding as res judicata. (iv) The rendering of a judgment ineffective by changing its basis by legislative enactment is not an encroachment on judicial power but a legislation within the competence of the Leg ", "657. supported the arguments of by citing pragmatic illustrations. He gave interesting statistics showing that a very small percentage of election petitions succeed eventually which, according to him, is evidence that such petitions are used by defeated candidates as an instrument of oppression against successful candidates. , therefore, wanted to save high personages from such harassment. A law may benefit a single individual and may still be valid. According to , the judgment of became a nullity by reason of that Court ceasing retrospectively to have jurisdiction over the dispute and a judgment which is a nullity need not be set aside. It can (sic cannot) even be challenged in a collateral proceeding. ", "658. I thought it only fair to indicate broadly the line of approach adopted by the various learned Counsels to the question as regards the validity of the Thirty-ninth Amendment. It will serve no useful purpose to take up each one of the points for separate consideration and indeed many an argument is interrelated. It would be enough for my purpose to deal with what I consider to be points of fundamental importance, especially as my learned brethren have dealt with the other points. ", "659. This Court has strictly adhered to the view that in constitutional matters one must decide no more than is strictly necessary for an effective adjudication of the points arising in any case. By that test, a numerically substantial part of the Thirty-ninth Amendment has to be deferred for consideration to a future occasion. We are clearly not concerned in these appeals with the new Article 71 introduced by the Thirty-ninth Amendment, which deal with the election of the President and the Vice-President. We are concerned with the new Article 329A but with the whole of it. Clause (1) to (3) of that article deal with future events and the validity of those clauses may, perhaps, be examined when those events come to happen. Clause (4) to (6) of Article 329A are the ones that are relevant for our purpose I propose to address myself to the validity of those provisions. ", "660. Clause (4) of Article 329A , which is the real focus of controversy, may conveniently be split up as follows for understanding its true nature and effect : (i) The laws made by prior to August 10, 1975 in so far as they relate to election petitions and matters connected therewith cease to apply to the parliamentary election of Smt. which took place in 1971. (ii) Such laws are repealed retrospectively in so far as they governed the aforesaid election, with the result that they must never be deemed to have applied to that election. (iii) Such an election cannot be declared to be void on any of the grounds on which it could have been declared to be void under the laws which were in force prior to August 10, 1975. (iv) The election shall not be deemed ever to have become void on any ground on which, prior to August 10, 1975, it was declared to be void. ", "(v) The election shall continue to be valid in all respects notwithstanding the judgment of any court, which includes the judgment da ", "661. has, as it were, a preliminary objection to the Thirty-ninth Amendment that the election of a private individual and the dispute concerning it cannot ever be a matter of constitutional amendment. Whether this contention is sound is another matter but I do not see the force of the argument of the Attorney-General that in view of the decisions in case (supra), case (supra) and the Fundamental Rights case (supra), the contention is not open to be taken. The question raised by was not raised or considered in either of the three aforesaid cases and I do not see how the question can be shelved. The argument is not new facet of the theory of inherent or implied limitations on the amending power, in which case it might have been plausible to contend that the last word was said on the subject by in the Fundamental Rights case. The question now raised touches a totally new dimension of the amending power : Can the Constituent As me Court to frame rules for regulating its practice and procedure, official language for communication between one State and another and last but not the least, elections to the and . Those to whose wisdom and judgment the constituent power is confided, will evoke scorn and derision if that power is used for granting or withdrawing building contracts, passing or failing students or granting and denying divorces. But the electorate lives in the hope that a sacred power will not so flagrantly be abused and the moving finger of history warns of the Consequences that inevitably flow when absolute power has corrupted absolutely. The fear of perversion is no test of power. ", "662. But the comparison is odious between the instances given by Shri Shanti Bhutan and subject-matter of Article 329A (4) of the Constitution. In the first place, elections to Legislatures were considered by Constitution-makers to be a matter of constitutional importance. Secondly, though the powers of the Prime Minister in a cabinet form of democracy are not as unrivaled as those of the President in the American system, it is undeniable that the Prime Minister occupies a unique position. The choice of the subject for constitutional amendment cannot, therefore, be characterized as trifling, frivolous or outside the framework of copious Constitution. In America, the challenge to the Eighteenth Amendment on the ground that ordinary legislation cannot be embodied in a constitutional amendment was brushed aside as unworthy of serious attention. endorsed it as consistent with the ultimate political theory on which the American constitutional system is based.\" ", "The people, acting through the machinery p ", "663. There was some discussion at the as to which features of the Constitution form the basic structure of the Constitution according to the majority decision in the Fundamental Rights case. That, to me, is an inquiry both fruitless and irrelevant. The ratio of the majority decision is not that some named features of the Constitution are a part of its basic structure but that the power of amendment cannot be exercised so as to damage or destroy the essential elements or the basic structure of the Constitution, whatever these expressions may comprehend. , C.J. mentions supremacy of the Constitution, republican and democratic form of the Government, secular character of the Constitution, separation of powers, federalism and dignity and freedom of the individual as essential features of the Constitution. and , JJ. have added to the list two other features : the mandate to build a welfare State and unity and integrity of the nation. and , JJ. added sovereignty of India as a f ", "664. I consider it beyond the pale of reasonable controversy that if there be any unamendable features of the Constitution on the score that they form a part of the basic structure of the Constitution, they are that : (i) India is a sovereign democratic republic; (ii) Equality of status and opportunity shall be secured to all its citizens; (iii) The State shall have no religion of its own and all persons shall be equally entitled to freedom of conscience and the right freely to profess, practice and propagate religion and that (iv) the nation shall be governed by a Government of laws, not of men. These, in my opinion, are the pillars of our constitutional philosophy, the pillars, therefore, of the basic structure of the Constitution. ", "665. I find it impossible to subscribe to the view that the preamble of the Constitution holds the key to its basic structure or that the preamble is too holy to suffer a human touch. Constitutions are written, if they are written, in the rarefied atmosphere of high ideology, whatever be the ideology. Preambles of written Constitutions are intended primarily to reflect the hopes and aspirations of people. They resonate the ideal which the nation seeks to achieve, the target, no the achievement. In parts, therefore, they are metaphysical like slogans. For example, the concept of fraternity which is referred to in our preamble is not carried into any provision of the Constitution and the concept is hardly suitable for encasement in a coercive legal formula. The preamble, generally, uses words of \"passion and power\" in order to move the hearts of men and to stir them into action. Its own meaning and implication being in doubt, the preamble cannot affect or throw light on the meaning of the enacting words of the ", "666. Judicial review, according to , is a part of the basic structure of the Constitution and since the Thirty-ninth Amendment by Article 329A (4) and (5) deprives the courts, including , of their power to adjudicate upon the disputed election, the amendment is unconstitutional. The fundamental premise of this argument is too broadly stated because the Constitution, as originally enacted, expressly excluded judicial review in a large variety of important matters. Articles 31(4), 31(6), 136(2), 227(4), 262(2) and 329(a) are some of the instances in point. True, that each of these provisions has a purpose behind it but these provisions show that the Constitution did not regard judicial review as an indispensable measure of the legality or propriety of every determination. Article 136(2) expressly took away the power of to grant special leave to appeal from the decisions of any court or tribunal constituted by a law relating to the armed forces. Article 262( ", "667. The provision contained in Article 329(b) is decisive on the question under consideration. That article provides that no election to the or shall be called in question except by an election petition presented to such authority and in such manner as may be provided for by or under any law made by the appropriate . It was therefore open to the to leave the adjudication of election disputes to authorities other than those in the hierarchy of our judicial system. In fact, until the passing of the Representation of the People (Amendment) Act , 47 of 1966, by which were given jurisdiction to try election petitions, that jurisdiction was vested first in a tribunal consisting of three members and later in a tribunal consisting of a single member who was to be a sitting District Judge. The decisions of those tribunals could eventually be brought before under Article 136(1) of the Constitution but it is at least plausible that we ", "668. In England, prior to 1770, controverted elections were tried by the whole as mere party questions but in order \"to prevent so notorious a perversion of justice\", the consented to submit the exercise of its privilege to a tribunal composed of its own members. In 1868, the jurisdiction of the to try election petitions was transferred by statute to the courts of law. A parliamentary election petition is now tried by two judges from out of there puisne judges of who are put on the rota for trial of such petitions by selection every year by a majority of votes of the judges of that division. At the conclusion of the trial, the must forthwith certify the determination to the Speaker. The determination, upon such certification, is final to all intents and purposes. Thus, in England, the election is constituted by a special method, it exercises a jurisdiction out of the ordinary jurisdiction which is normally exercised a jurisdiction out of the ", "669. Under Article 1 , Section 5 , Clause 1 of the American Constitution, each is the judge of the elections, returns and qualifications of its own members. Each , in judging of elections under this clause, acts as a judicial tribunal. Any further review of the decisions of the two s seems impermissible. ", "670. I am therefore unable to accept the contention that Article 329A (4) and (5) are unconstitutional on the ground that by those provisions, the election of the Prime Minister is placed beyond the purview of the courts. ", "671. Equally, there is no substance in the contention that the relevant clauses of the Thirty-ninth Amendment are in total derogation of \"political justice\" and are accordingly unconstitutional. The concept of political justice of which the preamble speaks is too vague and nebulous to permit by its yardstick the invalidation of a constitutional amendment. The preamble, as indicated earlier, is neither a source of power nor of limitation. ", "672. The contention that 'democracy' is an essential feature of the Constitution is unassailable. It is therefore necessary to see whether the impugned provisions of the Thirty-ninth Amendment damage or destroy that feature. The learned Attorney-General saw an insurmountable impediment in the existence of various forms of democracies all over the world and he asked : What kind and form of democracy constitutes a part of our basic structure? The cabinet system, the Presidential system, the French, the Russian or any other? This approach seeks to make the issue unrealistically complex. If the democratic form of government is the cornerstone of our Constitution, the basic feature is the broad form of democracy that was known to Our Nation when the Constitution was enacted, with such adjustments and modifications as exigencies may demand but not so as to leave the mere husk of a popular rule. Democracy is not a dogmatic doctrine and no one can suggest that a rule is authoritarian because some rights and safeguar ", "673. The question for consideration is whether the provision contained in Article 329A (4) and (5) are destructive of the democratic form of government. The answer does not lie in comparisons with what is happening in other parts of the world, those that stake their claim to 'democracy' because we are not concerned to find whether despite the Thirty-ninth Amendment we are still not better off, democratically, than many others. The comparison has to be between the per Thirty-ninth Amendment period and the post-Thirty-ninth Amendment period in the context of our Constitution. ", "674. \"Those of us who have learned humility have given over the attempts to define law\" ", ". This statement of may be used to express a similar difficulty in defining 'y' but just as legal scholars, not lacking in humility, have attempted to define 'law', so have political scientists attempted a satisfactory definition of 'y'. The expression is derived from the Greek work 'demos', which was often used by the Greeks to describe the many, as distinct from the few, rather than the people as a whole. And defined y as the rule of the poor, simply because they formed, always and necessarily, the more numerous class. But the word is commonly used \"in the sense of the rule of the majority of the community as a whole, including 'classes' and 'masses'........, since that is the only method yet discovered for determining what is deemed to be the will of the body politic is not unanimous. This will is expressed through the election of representatives. defines ", "675. Forgetting mere words which said : 'Like Nature, half reveal and half conceal the Soul within', the substance of the matter is the rule of the majority and the manner of ascertaining the will of the majority is throughout the process of elections. I find myself unable to accept that the impugned provisions destroy the democratic structure of our government. The rule is still the rule of the majority despite the Thirty-ninth Amendment and no law or amendment of the fundamental instrument has provided for the abrogation of the electoral process. In fact it is through that process that the electorate expressed its preference for Smt. over Shri and others. Article 326 of the Constitution by which the elections to and to shall be on the basis of adult suffrage still stands. Article 79 which provides that\" ", "There shall be a Parliament...... which shall consist of........ two Houses \", Articles 80 and 81 which prescribe th ", "676. This is not put a seal of approval on the immunity conferred on any election but it is hard to generalize from a single instance that such an isolated act of immunity has destroyed or threatens to destroy the democratic framework of our government. One swallow does not make a summer. The swallow with its pointed wings, forked tail, a curving flight and twittering cry is undoubtedly a harbinger of summer but to see all these in the Thirty-ninth Amendment and to argue that the summer of a totalitarian rule is knocking at the threshold is to take an unduly alarmist view of the political scene as painted by the amendment. Very often, as said by Sir , \"If there is any real danger it is of the alarmist's own making\". ", "677. The Thirty-ninth Amendment is, however, open to grave objection on other grounds, in so far as clauses (4) and (5) of Article 329A are concerned. Generality and equality are two indelible characteristics of justice administrated according to law. The preamble to our Constitution by which the people of Indira resolved solemnly to secure to all its citizens equality of status and opportunity finds its realization in an ampler measure in Article 14 which guarantees equality before the law and the equal protection of laws to all persons, citizens and non-citizens alike. Equality is the faith and creed of our democratic republic and without it, neither the Constitution nor the laws made under it could reflect the common conscience of those who owe allegiance to them. And if they did not, they would fail to command respect and obedience without which any Constitution which, without a true nexus, denies equality before the law to its citizens may in a form thinly disguised, contain reprisals directed against p ", "678. Article 329A(4) makes the existing election laws retrospectively inapplicable, in a very substantial measure, to the parliamentary elections of the Prime Minister and the Speaker. The inapplicability of such laws creates a legal vacuum because the repeal, so to say, of existing laws is only a step-in-aid to free the election from the restraints and obligations of all election laws, indeed of all laws. The plain intendment and meaning of clause (4) is that the election of the two personages will be beyond the reach of any law, past or present. What follows is a neat logical corollary. The election of the Prime Minister could not be declared void as there was no law to apply to that election; the judgment of declaring the election void is itself void; and the election continues to be valid as it was before pronounced its judgment. ", "679. These provisions are an outright negation of the right of equality conferred by Article 14 , a right which more than any other is a basic postulate of our Constitution. It is true that the right, though expressed in an absolute form, is hedged in by a judge-made restriction so that the same law will not apply to all persons alike or different laws may govern the rights and obligations of different persons falling within distinct classes. The boast of law that it is no respect or of persons is the despair of drawers of waters and hewers of wood who claim or for a differential treatment. The judge takes that boast to mean that in an egalitarian society no person can be above the law and that justice must be administered with an even hand to those who are situated equally. In other words, all who are equal are equal in the eye of law and it will not accord a favoured treatment to persons within the same class. Laws as said, would operate\" ", "like an obstinate and ignorant tyrant if they imposed inflexible ", "680. This , at least since the days of case, has consistently taken the view that the classification must be founded on an intelligible differential which distinguishes those who are grouped together from those who are left out and that the differential must have a rational relation to the object sought to be achieved by the particular. The first test may be assumed to be satisfied since there is no gainsaying that in our system of government, the Prime Minister occupies a unique position. But what is the nexus of that uniqueness with the law which provides that the election of the Prime Minister and the Speaker to the will be above all laws, that the election will be governed by no norms or standards applicable to all others who contest that election and that an election declared to be void by a High judgment shall be deemed to be valid, the judgment and its findings being themselves required to be deemed to be void? Such is not the doctrine of classification and no ", "681. It follows that clauses (4) and (5) of Article 329A are arbitrary and are calculated to damage or destroy the rule of law. Imperfection of language hinder a precise definition of the rule of law as of the definition of 'law' itself. And the Constitutional Law of 1975 has undergone many changes since , the great expounder of the rule of law, delivered his lectures as Vinerian Professor of English Law at , which were published in 1885 under the title, \"Introduction to the Study of the Law of the Constitution\". But so much, I suppose, can be said with reasonable certainty that the rule of law means that the exercise of powers of government shall be conditional by law and that subject to the exceptions to the doctrine of equality, no one shall be exposed to the arbitrary will of the Government. gave three meanings to rule of law : Absence of arbitrary power, equality before the law or the equal subjection of all classes to the ordinary law of the land the source but the consequence of ", "682. The argument directed at showing the invalidation of the Thirty-ninth Amendment on the ground that it abrogates the principle of 'separation of powers' is replete with many possibilities since it has several sidelights. But I will be brief since I have already held that clauses (4) and (5) of Article 329A are unconstitutional. I cannot regard the point as unnecessary for my determination since the point seems to me of great constitutional importance. ", "683. The Indian Constitution was enacted by in the backdrop of the national struggle for independence. The Indian people had gone through a travail and on the attainment of independence, the country had to face unique problems which had not confronted other federations like America, Australia, Canada or Switzerland. These problems had to be solved pragmatically and not by confining the country's political structure within the straitjacket of a known or established formula. , therefore, pursued the policy of pick and choose to see what suited the genius of the nation best. ", "\"This process produced new modifications of established ideas about the construction of federal governments and their relations with the governments of their constituent units. The assembly, in fact, produced a new kind of federalism to meet India's peculiar needs\" ", ". ", "While introducing the Draft Constitution in , Dr. who was one of the chief architects of the Constitution said that our Constitution avoided the tight mould of federalism in which American Constitution was caught and could be \"both unitary as well as federal according to the requirements of time and circumstances\" ", ". We have what may perhaps be described by the phrase, 'cooperative federalism' a concept different from the one in vogue when the federations of United States or of Australia were set up. ", "684. The American Constitution provides for a rigid separation of governmental powers into three basic divisions, the executive, legislative and judicial. It is an essential principle of that Constitution that powers entrusted to one department should not be exercised by any other department. The Australian constitution follows the same pattern of distribution of powers. Unlike these Constitution, the Indian Constitution does not expressly vest the three kinds of power in three different organs of the . But the principle of separation of powers is not a magic formula for keeping the three organs of the within the strict confines of their functions. As observed by , in his dissenting opinion in v. , the principle of separation of powers \"is not a doctrinaire concept to be made use of with pedantic rigour. There must be sensible approximation, there must be elasticity of adjustment in response to the practical necessities of Government which cannot foresee today ", "685. The truth of the matter is that the existence, and the limitations on the powers of the three departments of government are due to the normal process of specialisation in governmental business which becomes more and more complex as civilization advances. The must make laws, the enforce them and the interpret them because they have in their respective fields acquired an expertise which makes them competent to discharge their duly appointed functions. The Moghal Emperor, , was applauded as a reformist because soon after his accession to the throne in 1605, he got a golden chain with sixty bells hung in his palace so that the common man could pull it and draw the attention of the ruler to his grievances and sufferings. The most despotic monarch in the modern world prefers to be armed, even if formally, with the opinion of his judges on the grievances of his subjects. ", "686. The political usefulness of the doctrine of separation of powers is now widely recognised though a satisfactory definition of the three functions is difficult to evolve. But the function of the is to make laws, not to decide cases. The British in its unquestioned supremacy could enact a legislation for the settlement of a dispute or it could, with impunity, legislate for the boiling of the Bishop of Rochester's cook. The Indian will not direct that an accused in a pending case shall stand acquitted or that a suit shall stand decreed. Princely India, in some parts, often did it. ", "687. The reason of this restraint is not that the Indian Constitution recognizes any rigid separation of powers. Plainly, it does not. The reason is that the concentration of powers in any one organ may, by upsetting that fine balance between the three organs, destroy the fundamental premises of a democratic government to which we are pledged. Sir says in his 'Law and Orders' (1965 Ed., p. 8) that neither in 's analysis nor in 's are the governmental powers conceived as the familiar trinity of legislative, executive and judicial powers. 's \"separation\" took the form not of impassable barriers and unalterable frontiers, but of mutual restraints, or of what afterwards came to be known as \"checks and balances\"(p. 10). The three organs must act in concert, not that their respective functions should not ever touch one another. If this limitation is respected and preserved,\" ", "it is impossible for that situation to arise which and regarded as the eclips ", "688. I do not suggest that such an encroaching power will be pursued relentlessly or ruthlessly by our . But no Constitution can survive without a conscious adherence to its fine checks and balances. Just as ought not to enter into problems entwined in the \"political thicket\", must also respect the preserve of the courts. The principle of separation of powers is a principle of restraint which \"has in it the precept, inmate in the prudence of self-preservation (even if history has not repeatedly brought it home), that discretion is the better part of valour\" ", ". Courts have, by and large, come to check their valorous propensities. In the name of the Constitution, the may not also turn its attention from the important task of legislation to deciding court cases for which it lacks the expertise and the apparatus. If it gathers facts, it gathers facts of policy. If it records findings, it does so without a pleading and without framing any issues. And worst of all, if it decide ", "689. The , by clause (4) of Article 329A , has decided a matter of which the country's courts were lawfully seized. Neither more nor less. It is true, as contended by the learned Attorney-General and , that retrospective validation is a well-known legislative process which has received the recognition of this in tax cases, pre-emption cases, tenancy cases and variety of other matters. In fact, such validation was resorted to by the and upheld by this in at least four election cases, the last of them being . But in all of these cases, what the did was to change the law retrospectively so as to remove the reason of disqualification, leaving it to the courts to apply the amended law to the decision of the particular case. In the instant case the has withdrawn the application of all laws whatsoever to the disputed election and has taken upon itself to decide that the election is valid. Clause (5) commands the Supr ", "690. I find it contrary to the basic tenets of our Constitution to hold that the amending body is an amalgam of all powers -legislative, executive and judicial.\"Whatever pleases the emperor has the force of law\" is not an article of democratic faith. The basis of our Constitution is a well- planned legal order, the presuppositions of which are accepted by the people as determining the methods by which the functions of the government will be discharged and the power of the shall be used. ", "691. So much for the Thirty-ninth Amendment. The argument regarding the invalidity of the Representation of the People (Amendment) Act , 58 of 1974, and of the Election Laws (Amendment) Act , 1975 has, however, no substance. The constitutional amendments may, on the ratio of the Fundamental Rights case, be tested on the anvil of basic structure. But apart from the principle that a case is only an authority for what it decides, it does not logically follow from the majority judgment in the Fundamental Rights case that ordinary legislation must also answer the same test as a constitutional amendment. Ordinary laws have to answer two tests for their validity : (1) The law must be within the legislative competence of the as defined and specified in Chapter I, Part XI of the Constitution, and (2) it must not offend against the provisions of Article 13(1) and (2) of the constitution.'Basic structure', by the majority judgment, is not a part of the fundamental rights nor indeed a provision of the Constitu ", "692. Shri thought it paradoxical that the higher power should be subject to a limitation which will not operate upon a lower power. There is no paradox, because certain limitations operate upon higher power for the reason that it is higher power. A constitutional amendment has to be passed by a special majority and certain such amendments have to be ratified by the Legislatures of not less than one-half of the States as provided by Article 368(2). An ordinary legislation can be passed by a simple majority. The two powers, though species of the same genus, operate in different fields and are therefore subject to different limitations. ", "693. No objection can accordingly be taken to the constitutional validity of the two impugned Acts on the ground that they damage or destroy the basic structure. The power to pass these Acts could be exercised retrospectively as much as prospectively. ", "694. These Act s effectively put an end to the two appeals before us for they answer the totality of the objections which were raised by against the election of Smt. . The basis of the findings on which held against the successful candidate is removed by Act 40 of 1975 retrospectively. Were the law as it is under the amendments introduced by that Act, could not have held that the election is vitiated by the two particular corrupt practices. In regard to the cross-appeal filed by , thought that a part of it escapes through the crevices in the Act but I see no substance in that contention either. I would like to add that the findings recorded by in favour of Smt. are amply borne out by the evidence to which our attention was drawn briefly by the learned Counsel for the parties. The expenses incurred by the political party, together with the expenses incurred by her are not shown to exceed t ", "695. Finally, there is no merit in the contention that the constitutional amendment is bad because it was passed when some members of the were in detention. The legality of the detention orders cannot be canvassed in these appeals collaterally. And from a practical point of view, the presence of 21 members of and 10 members of who were in detention could not have made a difference to the passing of the amendment. ", "696. In the result, I hold that clauses (4) and (5) of Article 329A are unconstitutional and therefore void. But for reasons aforesaid I allow Civil Appeal No. 887 of 1975 and dismiss Civil Appeal No. 909 of 1975. There will be no order as to costs throughout."], "relevant_candidates": ["0000026511", "0000177595", "0000196752", "0000203735", "0000257876", "0000263845", "0000270610", "0000290217", "0000293632", "0000335022", "0000407809", "0000469911", "0000494297", "0000513801", "0000603957", "0000608874", "0000627937", "0000660275", "0000668225", "0000680015", "0000685234", "0000701977", "0000804743", "0000889086", "0000912630", "0000937486", "0000944601", "0000959306", "0000968805", "0001018531", "0001022089", "0001083760", "0001119590", "0001201341", "0001261287", "0001308308", "0001318432", "0001321505", "0001453838", "0001460328", "0001495774", "0001504198", "0001525911", "0001588713", "0001590934", "0001602521", "0001636320", "0001676875", "0001699291", "0001706770", "0001740805", "0001857950", "0001863813", "0001869779", "0001878241", "0001899063", "0001913766", "0001964341", "0001972259", "0001985056", "0021266288", "0181440373", "0184660633"]} {"id": "0000941104", "text": ["PETITIONER: UNION OF INDIA AND ORS. Vs. RESPONDENT: DATE OF JUDGMENT07/04/1977 BENCH: GUPTA, A.C. BENCH: GUPTA, A.C. BEG, M. HAMEEDULLAH (CJ) KAILASAM, P.S. CITATION: 1977 AIR 1548 1977 SCR (3) 472 1977 SCC (2) 870 CITATOR INFO : RF 1986 SC 626 (7,16) ACT: Central s and Salt Act , 1944---Schedule I Entry 21--Non-woven felts manufactured out of woollen fibres by machine pressing, whether \"wollen fabrics\" for the purpose of levy of excise duty--Rule of interpretation of items in a statute. HEADNOTE: An excise duty of Rs. 55055.87 was levied and collected from the respondent-firm by the authorities treating the non-woven felts manufactured by them as \"woollen fab- rics\" covered by entry 21 in Schedule I to the Central s and Salt Act , 1944. allowed the writ petition filed by the respondent and held that the respondent's products were not \"woollen fabrics\" and direct- ed the refund of the entire sum collected as excise duty. Dismissing the appeal by certificate to this Court, HELD: (1) The well-known rule in interpreting items in statutes is that resort should be had not to the scientif- ic or the technical meaning of such terms but to their popular meaning or the meaning attached to them by those dealing in them, that is to say, their commercial sense. [474 , AIR 1967 SC 1454, applied. (2) Fabric means woven material. Entries 19 to 22 in the Schedule deal with fabrics. Entry 21 describes woollen fabrics as meaning all varieties of fabrics manufactured out of wool, barring the exceptions mentioned, including blan- kets, lohis, rugs, shawls and embroidery in the piece in strips or in motifs. The word \"fabric\" in entry 21 has been used to mean woven material in which sense it is popularly understood. The term \"woollen fabrics\" in that sense was not wide enough to cover non-woven material which is wool- based. Blankets. rugs and shawls etc. have been specifical- ly included in the entry out of abundant caution to indicate that \"woollen fabrics\" in entry 21 means not only woollen garments but also woollen material used as covering or for similar other purposes. [473 H, 474 F-G] (3) It is plain from entry 21 in Schedule 1 to the Central s and Salt Act , 1944 that the respondent's products did not fall within it as they are nonwoven felts from woollen fibres. [474 C]- JUDGMENT: ", "CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1037 of 1971. ", "(From the Judgment and Order dated the 17th June, 1971 of in Special Civil Application No. 112/67). ", ", . and , for the appellants. ", " and , for the respondent. The Judgment of the Court was delivered by J.--The respondent is a partnership firm manufac- turing non-woven felts from woollen fibres which are uti- lised for the purpose of filtration in heavy industries. Between August 25, 1965 and January 5. 1967 the Excise authorities compelled the respondent to pay Rs. 55,055/87 p. as excise duty on its products. The respondent filed a writ petition in at Ahme- dabad for quashing the order levying excise duty on the felts manufactured by the respondent treating them as 'woo- llen fabrics' covered by entry 21 in Schedule I to the Central Excises and Salt Act , 1944 (hereinafter referred to as the Act). allowed the writ petition holding that the respondents products were not 'woollen fabrics' and directed refund of the sum of Rs. 55,055/87 p. collected as excise duty from the firm. has preferred this appeal on certificate of fitness granted by questioning the correctness of the deci- sion. ", "The only question in the appeal is whether the felts manufactured by the respondent are \"woolien fabrics\" within the meaning of entry 21 in the first schedule to the Act.The writ petition describes the process of manufacture and states that the thickness of the felts produced varies from 1 mm. to 50 mms. according to. the specification of the customers and that these are really machine pressed raw woolwaste. It is stated further that the felts manufactured .by the process described are neither sheets nor fabrics, they are not material from which garments could be prepared nor they could be used 'as covering or for similar other purposes. Entry 21 in the first schedule to the Act reads: ", "\"21. WOOLLEN FABRICS-- ", "\"Woollen fabrics\" .means all varieties of fabrics manufactured wholly of wool or which contain 40 per cent, or more by weight of wool and includes blankets, lohis, rugs, shawls and embroidery in the piece, in strips or in motifs: ", "Provided that in the case of embroidery in the piece, in strips or in motifs, the percentage referred to above shall be in relation to the base fabrics which are embroi- dered--_ (1) Woollen fabrics, other than Ten percent. ", "embroidery in the piece, in ad valorem. ", "strips or in motifs. --------- (2) Embroidery in the piece in The duty for strips or in motifs, in or in the time being relation to the manufacture leviable on the of which any process is ord- base fabrics, inarily carried on with the if not already aid of power. paid, plus twenty percent. ad va'orern ", "Explanation-----\" Base fabrics\" means fab- rics falling' under sub-item (1) of this Item which are subjected to the process of embroi- dery.\" ", "0 ", "Are the products of the respondent's factory woollen fabrics ? Fabric means woven material. The articles manu- factured by the respondent, as already stated, are non- woven felts from woollen fibres. It is contended on behalf of the appellant, , that in a technical sense the felts manufactured by the respondent would still be woollen fabrics. The well-known rule in interpreting items in statutes like the one we are concerned with is that \"resort should be had not to the scientific or the technical meaning of such terms but to their popular meaning or the meaning attached to them by those dealing in them, that is to say, to their commercial sense\". ( )(1). has held that a trader dealing in woollen fabrics would not regard the respondent's products as woollen fabrics, but it does not appear that there is any evidence on the record of the case to support the finding. However, an inquiry re- garding the meaning of the term woollen fabrics as commer- cially understood would be relevant only when there is doubt as to the sense in which the term has been used in entry 21; it seems to us plain from the entry read as a whole that the respondent's products did not fail within it. Entries 19 to 22 in the schedule all deal with fabrics. Entry 19 deals with cotton fabrics which is stated to cover, barring the exceptions specified, all varieties of fabrics manufactured either wholly or partly from cotton and in- cludes, dhoties, sarees, chadders, bed-sheets, bed-spreads etc. Entry 20 relates to slik fabrics which is said to mean all varieties of fabrics manufactured. either wholly or partly from silk with certain exceptions and includes em- broidery in the piece, in strips or in motifs. Entry 22 relates to rayon or artificial silk fabrics which also is said to mean all varieties of fabrics manufactured either wholly or partly from rayon or artificial silk with some exceptions and includes embroidery in the piece, in strips or in motifs etc. In this group, entry 21 describes woollen fabrics as meaning all varieties of fabrics manufactured out of wool, barring the exceptions mentioned, including blankets, lohis, rugs, shawls and embroidery in the piece, in strips or in motifs. If the term 'woollen fabrics' in this entry had been used in its technical or scientific sense and, if in that sense, it was wide enough to cover non woven material which is wool-based, then it is diffi- cult to explain why the entry should specifically mention blankets, rugs and shawIs as being included within it. No one could possibly be in any doubt in respect of these few items if the term was so pervasive, and there was no reason for singling out these specific objects. On the contrary, the mention of these items suggests that the word 'fab- rics' in entry 21 has been used to mean woven material in which sense it is popularly understood, and blankets, rugs and shawls etc. have been specifically included in the entry out of abundant caution to indicate that 'woollen fabrics' in entry 21 means not only woollen garments but also woollen material used as 'covering or for similar other purposes. We therefore find no reason to take a view different from that taken by . ", "The appeal is dismissed with costs. ", "S.R. Appeal dismissed. (1) A.I.R. 1967 S.C. 1454."], "relevant_candidates": ["0000547717"]} {"id": "0000952359", "text": ["JUDGMENT , J. ", "1. Messrs. , the assessee, was assessed to income-tax for the assessment years 1966-67 and 1969-70, the accounting periods ending on June 30, of the calendar years of 1965 and 1968. In the said assessment year 1966-67, the assessee claimed allowance on depreciation and deduction of business expenditure. The Income-tax Officer found that during the accounting period ending on June 30, 1965, the total purchase of raw materials was worth only Rs. 1,220, consumption of raw materials was worth only Rs. 120 and stores and spares to the extent of only Rs. 70 had been consumed. The Income-tax Officer held that the assessee had not commenced manufacturing and that production, if any, during the period was only on an experimental basis. On that ground, the Income-tax Officer disallowed depreciation and deduction of business expenditure. ", "2. For the assessment year 1969-70, the Income-tax Officer found that the plant and machinery of the assessee did not work for the whole year. Total consumption of raw material during the year was also low and a very limited quantity of finished goods were produced. On the ground that the factory of the assessee had worked for less than thirty days, the claim of the assessee for depreciation was disallowed. ", "3. Being aggrieved, the assessee went up in appeal before the Appellate Assistant Commissioner. The Appellate Assistant Commissioner considered the directors' report as also the profit and loss account of the assesses and found that the plant and machinery of the assessee were in use though on a very small scale in the assessment year 1966-67. He held that the assessee had set up its business during the relevant accounting year as it had commenced production and following the decision of in 26 ITR 151, and of in the case of v. 63 ITR 478, held that the Income-tax Officer was not justified in disallowing the depreciation and expenditure on the ground that it was prior to the commencement of the assessee's business. ", "4. On the basis of the aforesaid finding for the assessment year 1966-67, the Appellate Assistant Commissioner also held that in the assessment year 1969-70, the appellant having set up its business earlier, the Income-tax Officer should have allowed depreciation as also development rebate. ", "5. Being aggrieved, the went up in appeal before . Before the Tribunal, the relied on a decision of in 63 ITR 72, where it was held that where erection of plant had been completed and only a small quantity of raw material was consumed without any actual turning out of finished products, it could not be said that the business of manufacture had commenced. The consumption of raw materials, if any, would be only by way of experiment and the deduction of the amount claimed as business expenditure could not be allowed. ", "6. The held that did not have occasion to consider the decision of in the case of [1967] 63 ITR 478, where had allowed the claim of the assessee to deduction of business expenditure where the business had actually been set up. On that ground, the rejected the contentions of the . The held further that as the business had been set up in the year 1966-67, the claim for depreciation in the subsequent assessment year 1969-70 should be allowed automatically. ", "7. On the application of the under Section 256(1) of the Income-tax Act, 1961, the following question has been referred as a question of law arising out of the order of the Tribunal for the opinion of this court: ", "\"Whether, on the facts and in the circumstances of the case, the was right in holding that the business was set up within the meaning of the Income-tax Act during the accounting year relevant to the assessment year 1966-67 and, as such, whether the assessee was entitled to depreciation and expenses claimed for the assessment year 1966-67 and depreciation for the assessment year 1969-70 ?\" ", "8. At the hearing before us, learned counsel for the drew our attention to the decision cited earlier in the proceedings below. He relied, in particular, on the decision of in the case of Sir [1967] 63 ITR 72 and invited us to follow the same. The other decisions are as follows : ", "(a) CWT v. : ", "9. In this case, held that where a business unit had been set up by the assessee which was ready to commence production, the assessee was entitled to claim deduction of the expenditure which could not be disallowed on the ground that the same had been incurred prior to the commencement of the actual business of commercial production. made a distinction between setting up of a unit and the operational function of the unit as a business. ", "(b) . : ", "10. In this case, the assessee was incorporated with the object of manufacture and sale of cement in the relevant assessment year. The assessee obtained a mining lease for quarrying limestone and started, mining operations. In its assessment to income-tax, the assessee claimed deduction of expenditure incurred for extracting limestone and also depreciation and development rebate for its machinery. It was held by of that the business of the assessee consisted of three types of activities, viz., acquiring raw materials, manufacturing of cement and sale of cement. It was held that the activity in quarrying limestone was a part of the assessee's business which came first in point of time and that the assessee had commenced business when it started its activity of extraction of limestone. The expenditure incurred and the depreciation and development rebate claimed were held to be deductible in computing the trading profits of the assessee. ", "(c) : ", "11. In this case, of this court following the decision of in the case of [1967] 63 ITR 478, held that where a business had been set up by the assessee, the expenses incurred in such setting up could not be disallowed on the ground that the assessee had not commenced commercial production in such business. ", "12. In the case before us, the Appellate Assistant Commissioner and the have come to a finding that the assessee had set up its business in the assessment year 1966-67. This finding has not been challenged as perverse and has become final. In the face of such finding, following the decision of referred to above, the question referred has to be answered in the affirmative and in favour of the assessee. The business having been set up in the earlier assessment year, it also must be held that the same position continued in the subsequent assessment year 1969-70. ", "13. There will be no order as to costs, , J. ", "14. I agree."], "relevant_candidates": ["0000172640", "0000902937", "0001120278", "0001847412"]} {"id": "0000957599", "text": ["ORDER ", "1. The petitioner is serving as Deputy Manager in the Production Centre in the establishment of the second respondent- in the Twin Cities (). The petitioner was placed under suspension by the proceedings of the Managing Director of the dated 13-3-1996 under Rule 23(iv) of the Employees Conduct, Discipline and Appeal Rules, 1983, for short 'the CCA Rules' pending further investigation and enquiry against the petitioner. This order was issued by the Managing Director in pursuance of the order of the , G.O. Rt. No.218, Industries and Commerce (SES) Department dated 12-3-1996 directing the management of to place the petitioner and four others under suspension pending enquiry. The , further, by the impugned proceeding, G.O. Rt. No.235, Youth Advancement Tourism and Culture (Ses) Department dated 18-6-1998 continued the suspension of the petitioner beyond 12-3-1998. ", "2. No charges are yet framed against the petitioner. However, in the counter filed by the first respondent it is stated that the enquiry revealed that the petitioner had drawn a sum of Rs.45,000/- as advance for purchase of raw materials, but he failed to produce the relevant vouchers, stock entries, and he did not choose to get the advance adjusted immediately. Nothing concrete is said or laid in the counter filed by the management of justifying the continued suspension of the petitioner. The allegations arc vague and general in nature. ", "3. The only question which arises for consideration is whether the continued suspension of the petitioner, in the facts and circumstances of the case, is justified and legal or whether it is arbitrary and unreasonable. ", "4. The power of the management of to place the petitioner under suspension in contemplation of and/or pending departmental enquiry is not contested before the Court. The power of suspension or to extend the period of suspension has to be exercised with circumspection, care and after application of mind. The employer must make a fair and proper assessment of the matter in the given circumstances and carefully scrutinise that prima facie there exists grave and compelling circumstances which in the light of the material available and collected during the preliminary enquiry or investigation would lead to the likelihood of the removal or dismissal of the employee from service. Although suspension of an employee in contemplation of or pending enquiry as such does not violate any of his legal right, it should not be forgotten that the suspended employee is subjected to social ridicule, condemnation and humiliation; he is looked down by colleagues, friends, kith and kin and he lives a life of tarnished image, infamy and agony. A proper judgment exercised would prevent unnecessary harassment and humiliation of suspension. Suspension should not be resorted to as a matter of course unless the allegations against the employee are serious. The employer, before resorting to suspension, shall consider whether the continuation of the delinquent would be detrimental to public interest or would hamper the enquiry or whether the delinquent, if continued in the post, is likely to tamper with official records relating to the allegation or charge or influencing the witnesses. If there are no such facts, suspension of delinquent will not be justified. , in the case of , 1994 (2) SLR (Calcutta) 77, held that an order of suspension shall not be made in an arbitrary manner and any order of suspension, if casually made, will cause harm and suffering to the concerned employee. If after suspension enquiry is unduly delayed or prolonged, then, it will be an indication to show that the suspension is not bona fide. An employee who is placed under suspension in contemplation of enquiry or pending enquiry is entitled to ask on suspension that the matter should be investigated within the reasonable period of time, and if such a principle of natural justice is not recognised, then, it would imply that the employer is vested with a totally arbitrary and unfettered power of placing its employees under disability and distress for an indefinite duration. The suspension order is bad if it is not followed by the charge-sheet within reasonable time. It is unjust on the part of the employer to pass an order of suspension and then not to take any further action for years. ", "5. In the instant case the petitioner was placed under suspension more than 31 months back and till date no charges are framed. There is no reasonable explanation for this inordinate delay. The only defence purforth in the counter- ", "affidavits filed by the respondents is that the preliminary enquiry/investigation is \"entrusted to and the investigation is under progress and the outcome of the report is awaited,\" It is not the case of the respondent tliat the petitioner is involved in a scries of malpractices and blame-worthy transactions and therefore the requires more time to investigate into malpractices. The only allegation as set out in the counter is that the petitioner drew a sum of Rs.45.000/- as advance for purchase of raw materials, but he has failed to produce the relevant vouchers, stock entries and he did not choose to get the advance adjusted immediately. I am at a loss to understand how more than 31 months time is not sufficient for the to investigate and submit report. The investigating agency cannot take its own time for investigation which is comparable to a preliminary enquiry at its pleasure and at the peril of the delinquent employee; it is expected that the investigating agency should act with promptitude and diligence. That is why this in number of opinions handed down in the cases involving review of suspension orders held that an employer having placed an employee under suspension in contemplation of or pending enquiry should act with promptitude and diligence, frame the charges within the reasonable time and conduct and conclude the enquiry and pass appropriate order without much loss of time. Such a course is not only imperative in the interest of the charged employee but also in the best interest of the maintenance of healthy employer-employees relationship and to maintain harmony in an organisation or an industry. Be that as it may, if there is a delay on the part of the in investigating and submitting the report, the respondents should have taken up the matter with the and directed it to investigate and submit the report without much loss of time. It is not forthcoming from the records that such a course was adopted by the respondents. ", "6. in , 1973 (2) SLR 553 (Ori HC), while reviewing the validity of the suspension order of an employee held that if there was a delay on die part of in investigating the offence, then the department should have taken up the matter with the police authority and that the prolonged suspension of the employee was unjustified. To the same effect is the decision of in , 1961 (2) LLJ 644 (SC). in , 1983 Lab.IC 1743 (Mad- HC) held that an employee cannot indefinitely be kept under suspension pending issue of charge-sheet and the continued suspension of the employee is penal in character. In the case of ., 1978 SLJ 421 the Court held that the continued suspension of the employee for a period of 2-1/2 years without framing the charge-sheet and without any reasonable explanation for the delay is unjustified. These decisions show that even in those cases where there is no time limit to issue charge-sheet after suspension; the employer is obligated to investigate into the allegations and frame charges and conclude the disciplinary proceedings within a reasonable time with diligence and promptitude. ", "7. has issued G.O.Ms. No. 86, General Administration (Services-C) Department dated 8-3-1994. Sub-clause (iii) of Clause 3 of the Order provides for an outer limit of two years for suspension of a public servant and it states tliat only in exceptional cases having regard to the gravity of the charges levelled against an employee, suspension be extended beyond a period of two years. Here is a very pathetic case. The outer limit of time prescribed under the above Order spent itself even before the charges are framed. The charge to be framed against the petitioner-delinquent is not in the sight anywhere and it seems to be indefinite. In that view of the matter, it should be held that the continued suspension of the petitioner by the impugned order of the without disclosing reasons is unjustified and unwarranted. Even then, the would not have intervened if the respondents are likely to frame the charges against the petitioner in the near future. In the course of the hearing, the pointedly asked the learned Counsel appearing for the respondents as to whether the respondents intend to frame the charges against the petitioner in the near future. There is no satisfactory and responsible response to the 's query. On the other hand, stock reply of the learned Counsel for the respondents is that investigation is pending and they would take steps only after submission of the report by the and that it is the prerogative of the employer to place an employee under suspension in contemplation of or pending departmental enquiry. There is no sign of the second respondent framing the charges against the petitioner in the near future and the respondents do not show any inclination or anxiety or urgency to frame the charges without further loss of time. The lamentable callousness of the respondents cannot be countenanced by the . The power of employer to place the employee under suspension in contemplation of or pending departmental enquiry, which power repeatedly called' 'prerogative'' by the learned Pleader in her wisdom, is not a Royal prerogative nor a prerogative of an absolute monarch or despot. The power vested in the employer to place an employee under suspension is not an absolute power. The word \"absolute power\" does not find a place in the dictionary of our Constitutional and Administrative Laws. The power to suspend an employee vested in the respondents is a public power; every public power is a limited power, and the donee of that power is expected to exercise that power reasonably and fairly and not arbitrarily and capriciously. That is what Article 14 mandates and commands. ", "8. In the result, the writ petition is allowed with no order as to costs and the impugned order of the Government G.O. Rt. No.218, ) department dated 12-3-1996 is quashed. However, it is made clear that this order shall not come in the way of the respondents framing the charges and conducting departmental enquiry against the petitioner. Liberty is also reserved to the respondent to seek review of this order if they find the petitioner indulging in tampering of the official records relating to the allegations or influencing the witnesses."], "relevant_candidates": ["0000174077", "0000774563", "0000921611", "0001695455", "0114071648"]} {"id": "0000983398", "text": ["JUDGMENT Gajendragadkar, C.J. ", "1. This appeal has been brought to this Court by the appellant, Dr. , on a certificate granted to him by . It arises from an election petition filed by him on April 10, 1962 before (II), Chandigarh (No. 99 of 19,62) against the five respondents. These respondents are: , , , and , respectively. The appellant contested the election to from the Dasuya Constituency at the last General Election in the beginning of 1962. The result of this election was declared on February 25, 1962 when respondent No. 1, , was declared to have been duly elected. The appellant and respondent No. 1 had secured 22,406 and 22,803 votes, respectively' and so, it is clear that respondent No. 1 had a very narrow margin over the appellant. The other respondents appeared to have played no significant part in the election, because the votes they secured were 948, 682, 240 and 756, respectively. After the result of the election was announced, the appellant filed an election petition under the relevant provisions of the Representation of the People Act , 1951 (No. 43 of 1951) (hereinafter called \"the Act\"). By his petition, the appellant claimed a declaration that the election of respondent No. 1 was void and that he had in fact been duly elected at the said election. The proceedings before the were lengthy and protracted and the dispute between the parties appears to have been fought with great bitterness and heat. The appellant made several allegations against respondent No. 1 and urged on the strength of the said allegations that his election was void. One of the prayers made by the appellant in his election petition was that for the reasons which he had indicated therein, he was entitled to have an inspection of the ballot boxes and a recount made of the votes cast in favour of the respective parties. The upheld his plea and allowed inspection of the ballot boxes. As a result of the recount made by the , the came to the conclusion that the appellant be declared to have been elected at the said election. ", "2. At the trial, the initially raised 14 issues; some of them were in the nature of preliminary issues, while others had reference to the merits of the controversy between the parties. On the 24th August 1962, on a request made by respondent No. 1, two more issues were added, and that made the number of issues 16. Thereafter, on the 3rd September 1962, the added three more issues. In consequence, 19 issues came to be tried by the . ", "3. The decision of the which was in favour of the appellant, however, rested on three findings. It held that respondent No. 1 had committed the corrupt practice of bribery by offering and giving Rs. 1,000 to with the object of inducing him to withdraw from being a candidate at the election, and by offering and giving Rs. 2,000 at Safdarpore to and others with the object of inducing the electors in that village to vote for him at the election. These two findings would show that respondent No. 1 had committed corrupt practices as defined by Section 123(1)(A)(a) and (b) of the Act. The further found that the result of the election in so far as it concerned the returned candidate had been materially affected by the improper reception of votes in his favour which were void and by the improper rejection of valid votes polled in favour of the appellant. On a proper re-counting, the , came to the conclusion that respondent No. 1 had received 22,412 votes, and the appellant was found to have received 22,491 votes. This conclusion of the was recorded under Section 100(1)(d)(iv) of the Act. In the result, the allowed the election petition, declared the election of respondent No. 1 to be void, and gave the appellant a declaration that he had been duly elected to from the Dasuya Constituency of Hoshiarpur District. This decision of the was pronounced on the 7th April 1964. ", "4. Against this decision, respondent No. 1 preferred an appeal before . Before respondent No. 1 challenged the correctness of the findings which had been recorded against him by the . The appellant supported the said findings and also attempted to support the final conclusion of the on the additional ground that the was in error in recording findings against him on two issues. These two issues arose from the case made out by the appellant that respondent No. 1 had, in the course of his election, exceeded the amount of Rupees 7,000 which is the permissible expenditure under the law. According to the appellant, respondent No. 1 had in fact spent Rs. 16,340. The had rejected this case, and the appellant urged before that the decision of the on this issue was wrong. Similarly, the appellant had urged before the that respondent No. 1 had paid by way of bribe Rs. 1,000 to , respondent No. 3 who was a contesting candidate at the election; and the has found that this story had not been satisfactorily proved. The appellant argued before that even this finding was wrong. ", "5. That is how was called upon to consider the correctness of the findings recorded by the against respondent No. 1, and also to consider whether the appellant was right in contending that the findings recorded by the in favour of respondent No. 1 on two issues were justified. The two learned Judges of who heard this appeal have delivered separate, but concurring, judgments dealing with the points which had been conveniently divided between them for elaborate treatment and discussion. In the result, has held that the findings recorded by the on two issues in favour of respondent No. 1 were justified, whereas the findings recorded by it in favour of the appellant arid against respondent No. 1 were not justified. The\" appeal preferred by respondent No. 1 was accordingly allowed, and the election petition filed by the appellant was ordered to be dismissed. ", "6. As we have already indicated, the contest between the parties in the present proceedings has been very bitter, and elaborate evidence has been led by both of them in regard to the several issues which arose for decision. The paper-books which have been prepared in this appeal for our use extend over nearly 1,700 printed pages, the judgment of the spreads over 172 pages, whereas the two judgments delivered by the learned Judges of occupy about 100 pages. Even so, as often happens, the controversy between the parties before this Court has been limited to a few points which can be legitimately raised under Article 136 of (he Constitution. ", "7. It is relevant at the outset to indicate briefly the approach which this Court generally adopts in dealing with election appeals brought before it under Article 136. It is well settled that the jurisdiction of in dealing with an election appeal under Section 116-A of the Act is very wide. It is open to to re-appreciate the evidence and consider the propriety, correctness or legality of the findings recorded by the in its order under appeal. Naturally, as , would not interfere with the findings of the fact recorded by the which are based merely on appreciation of oral evidence. But that is not to say that cannot so interfere if it comes to the conclusion that the impugned finding is erroneous and deserves to be reversed. When the matter comes to this Court under Article 136 against the appellate decision of , this Court generally does not interfere with question of fact. Ordinarily, the findings of fact recorded by in dealing with an appeal under Section 116-A of the Act are not disturbed, unless there are strong and compelling reasons to do so. The position becomes still more difficult for the appellant where the findings of fact recorded by happen to confirm similar findings recorded by the . That is why the limits of the controversy in election appeals brought to this Court under Article 136 naturally become very narrow. ", "8. In the present case on two points and the have made concurrent findings. The first is in relation to the expenses alleged to have been incurred by respondent No. 1 in excess of the permissible limit of Rs. 7,000; and the other is in relation to the bribe alleged to have been paid by respondent No. 1 to , respondent No. 3. Both the and have elaborately considered the oral evidence led by the parties and have examined the probabilities in the case and the conduct of the parties respectively. It appears from these findings that neither , nor the was satisfied that it would be safe to accept the evidence adduced by the appellant and hold that respondent No. 1 was guilty of the charge of excessive expenditure or of offering a bribe to . That being so, we have not allowed Mr. for the appellant to raise these points before us, because we thought that we would not be justified in examining the evidence ourselves to consider the propriety or correctness of the said findings. ", "9. That takes us to the two allegations of bribe-giving on which has reversed the conclusions of the . Even in considering Mr. 's contention that the findings recorded by on these two points are erroneous, our approach naturally is to enquire whether Mr. is able to show any serious error in the approach adopted by or in its appreciation of evidence which would justify our interference. In considering this aspect of the matter, the nature of the enquiry would be not whether this would necessarily have come to the same conclusion as has done, but whether the conclusion of is so erroneous that this must interfere with it. After all, in dealing with questions of this kind, has to take into account the oral as well as the documentary evidence bearing on the points and the other relevant and material circumstances. If, after carefully considering all such evidence, comes to a definite conclusion, ordinarily this would not feel inclined to interfere with such a conclusion after appreciating the relevant evidence itself. That is the approach which we propose to adopt in dealing with the contentions raised by Mr. in the present appeal. ", "10. The first charge of bribe made by the appellant against respondent No. 1 is that respondent No. 1 persuaded to withdraw his candidature from the election. It was his case that is an Ad-Dharmi and an influential member of his community; and he urged that had been adopted as an official candidate by . The appellant specifically averred that respondent No. 1 had offered to Rs. 1,000/- with a view to induce him to withdraw from his candidature. In that connection, it was alleged that respondent No. 1 met on the 30th January, 1962 along with , a worker, and , the District Secretary of , and made a formal request that should withdraw. As a result, Rs. 1,000/- were paid and withdrew his candidature from the election. ", "11. In support of this case, the appellant examined , P. W. 16, , P. W. 30, and , P. W. 31, whereas respondent No. 1 examined , R. W. 14, and , R. W. 13. According to , when the bribe of Rs. 1000/- was offered by respondent No. 1, he did not accept the money, but did. It would thus be seen that the decision of this question depends on whether the evidence given by the 3 witnesses whom the appellant examined, was to be preferred to the evidence given by the 2 witnesses whom respondent No. 1 examined. was not prepared to believe the evidence of the appellant's witnesses. It held that appeared to be the tenant of the appellant at the relevant time, and in that sense, was not reliable. In regard to , thought that part of the evidence given by him was inadmissible; and with regard to , it took the view that he was not a trustworthy witness. On the other hand, was inclined to take the view that the evidence given by respondent No. 1's witnesses and was more reliable, ", "12. There are two comments which has made in reversing the conclusion of the on this part of the appellant's case. The first comment is that the has not given due' consideration to the fact that the evidence of and satisfactorily shows that was not adopted by as its own candidate at all; and has observed, and we think, rightly, that if had not been duly adopted as an official candidate by , the whole basis of the appellant's case that he was an important rival and had, therefore, to be persuaded to withdraw from the election, falls to the ground. The evidence to which has referred in support of its finding that had not been adopted by as its candidate, is very satisfactory; and so, the criticism made by against the in that behalf cannot be said to be unjustified. ", "13. The other comment which has made in regard to the decision of the has reference to the criticism made by respondent No. 1 against . claimed to be a staunch worker of long-standing and presumably to support this claim, he appeared in the witness-box dressed in 'khaddar' clothes which generally constitute the uniform of workers. It was suggested to in cross-examination that he had put on 'khaddar' clothes only a day before he appeared in the witness-box to create an impression that he always put on the 'khaddar' uniform of the Party. Dealing with this criticism made by respondent No. 1 against the conduct of , the has observed in its judgment that the 'khaddar' clothes which had worn did not appear to be new. has pointed out that this observation made by the does not appear to be justified, because the had not made any note to this effect when the evidence of was recorded. The delivered its judgment long after the evidence of was recorded, and if it wanted to make an observation of this character, it should have made a contemporaneous note to that effect in the record of the proceedings. We cannot see how Mr. can quarrel with the comment thus made by against the 's observation. Therefore, we are satisfied that no legitimate or valid grievance can be made by the appellant in regard to the finding recorded by in respect of the appellant's case that Rs. 1,000/- were paid by respondent No. 1 for the withdrawal of from the election. ", "14. The next charge of bribery is in relation to the payment of Rs. 2,000/- alleged to have been made by respondent No. 1 to of village Safdarpore. The appellant's case is that when respondent No. 1 offered Rs. 2,000/- to on the 22nd February, 1962, was first reluctant to accept that amount; but respondent No. 1 left the amount with him and it was subsequently credited to the funds. The appellant urged that the receipt of this amount was expressly referred to in the s resolution passed on the 8th March, 1962. In support of this case, the appellant examined , P. W. 17, a member of the and , P. W. 18, a resident or the village. It appears that was called upon to produce the records of the in order to enable the appellant to prove his case. Ext. P. 41 is the proceeding book in which the resolution of the 5th March, 1962 is recorded. When produced the said record, two loose sheets of paper were found among the pages of the Cash Book (Ext. P. 42) and they have been admitted and marked as Exts. P. 43 and P. 43-A in spite of the objection of respondent No. 1. The appellant relied on these two sheets as well as the resolution. Respondent No. 1 examined , Sarpanch, R. W. 23, , the Secretary of the R. W. 20 and , R. W. 24, a Member of the . has held that the position disclosed by the evidence led by the parties was unsatisfactory and that the matter \"is not free from doubt\", with the result that was unable to make a finding that the charge leveled against respondent No. 1 in respect of the payment of Rs. 2,000/- to the of the village had been brought home to him. ", "15. Mr. has strenuously contended that was in error in recording this finding. He does not dispute the fact that when deals with allegations about the commission of corrupt practice by a returned candidate, the charges framed are in the nature of quasi-criminal charges. The proof of the charge has a double consequence; the election of the returned candidate is set aside, and he incurs subsequent disqualification as well. Therefore, when a charge of this kind is framed against a returned candidate, it has to be proved satisfactorily. It is true that itself has observed that the cross-examination of and did not disclose any intrinsic infirmity to justify the rejection of their evidence; but it has also pointed out that there is no reason why the evidence of , and should be disregarded either. Thus, the state of the oral evidence was fairly equally balanced, and the decision of the issue, therefore, depended upon the documentary evidence produced in the proceedings, and it is on the documentary evidence that Mr. has placed considerable reliance. ", "16. The resolution passed by the on the 5th March, 1962 reads thus:-- ", "\"It was also passed that has got collected a sum of Rs. 3,000/- for the school and that the Government should also give a grant of Rs. 3,000/- for the school. This grant should be given Immediately and should be sent without any loss of time in order that the construction work of the school building may be started. This was passed. It was also resolved that a copy of the resolution be sent to the Block Development Officer with the request that the grant of the school should be sent immediately.\" ", "Mr. contends that the first part of the resolution clearly indicates that an amount of Rs. 2,000/- had been received by the from respondent No. 1. It is common ground that at the relevant date, the had about Rs. 1,200/- cash balance with it; and the argument is that the said cash balance and the amount of Rs. 2,000/- paid by respondent No. 1 represent Rs. 3,000/- which is referred to as having been collected by the . This argument has not been accepted by . took the view that since the object of the resolution plainly was to secure from the a matching grant of Rs. 3,000/-, the recital that Rs. 3,000/- had already been collected need not be literally construed. referred to the fact that about Rs. 2,200/-was lying in deposit with the Board which was due to the by way of compensation for the acquisition of some land in the village for the construction of a road; and since the was entitled to recover this amount, it might have treated that amount as already received. On the other hand, it is shown by evidence that this amount had not in fact been received on the date of the resolution, and was not received even thereafter before the school building was completed. In dealing with the question as to whether the conclusion of is right or not, we cannot lose sight of the fact that the object of the resolution was undoubtedly to secure a matching grant from the for the construction work of the school building; and so, we are not prepared to hold that was in error in refusing to treat me first recital in the resolution too literally. ", "17. Mr. , however, strenuously contended before us that this conclusion of is shown to be erroneous by the fact that the construction work was substantially completed between March and July, 1962, and the necessary expenses actually incurred; and he points out that unless Rs. 2,000/- bad been actually received by the , it would have been impossible for the to pay the expenses incurred in the construction of the school building. This aspect of the matter, no doubt, makes the appellant's case arguable; but the difficulty in accepting the argument lies in the fact that hag made a definite finding that the slips of paper Exts. P. 43 and P. 43-A as well as the cash book produced in the proceedings showed that the had received considerable amount during the period from its legitimate sources of income. The has found that \"all that is shown by the entries in the cash book and the abstracts P. 43 and P. 43-A is that the money spent on the work of construction came from the funds available to the without either any Rs. 2,000/- from or from the compensation\". The has also found that the said documents showed that the had about Rs. 1,200/- in hand in March, 1962 and that at no time had the expenditure on the construction work exceeded the amount available in the funds up to July. Therefore, the main argument on which Mr. rested his case before us does not appear to be well founded. The evidence shows that the had funds at its disposal from which the expenditure involved in the construction of the school building could be, and must be, deemed to have been incurred. It is not, therefore, possible to accept the argument that but for the receipt of Rs. 2,000 from respondent No, 1, this expenditure could not have been incurred. That is why we do not think that we would be justified in interfering with the finding of on this point. ", "18. That takes us to the question as to whether respondent No. 1 was guilty of a corrupt practice under Section 123(4) of the Act. The appellant's case is that respondent No. 1 was responsible for the publication of a pamphlet in \"\" which made four false allegations in regard to the personal character of the appellant, and he made those allegations believing them to be false, or not believing them to be true. That is how a charge under Section 123(4) was leveled against respondent No. 1 by the appellant. He also urged that by the publication, in , of certain false reports respondent No. 1 had made false statements in relation to the candidature of the appellant knowing that the said statements were false and not believing them to be true. That, again, is a charge under Section 123(4) . The and have made concurrent findings against the appellant on both these points; but Mr. contends that in recording the said findings, they have misdirected themselves in law, and that is why it is necessary to consider the points of law raised by Mr. in this connection. ", "19. Section 123(4) provides, inter alia, that the publication by a candidate of any statement of fact which is false, and which he either believes to be false or does not believe to be true, in relation to the personal character or conduct of any candidate, or in relation to the candidature of any candidate, being 4 statement reasonably calculated to prejudice the prospects of that candidate's election, is a corrupt practice. It would be noticed that the onus to prove the essential ingredients prescribed by the said subsection is on the appellant. He has to show that the impugned statement has been published by the candidate or his agent or by any other person with the consent of the candidate or his election agent. This fact has been proved in the present case in regard to both the statements. The appellant has further to show that the impugned statement is a statement of fact which is false; that respondent No. 1 either believed that the said statement was false, or did not believe it to be true; and that the statement is in relation to the personal character or conduct of the candidate or his candidature. ", "20. The question as to what allegations can be said to amount to allegations in regard to the personal character of a candidate, as distinguished from his public character, is not always easy to decide on consideration of abstract principles. The policy underlying the present provision is that in the matter of elections, the public and political character of a candidate is open to scrutiny and can be severely criticised by his opponents, but not so his private or personal character. In order that the elections in a democratic country should be freely and fearlessly conducted, considerable latitude has to be given to the respective competing candidates to criticise their opponents' political or socio-economic philosophy or their antecedents and character as public men. That is why even false statements as to the public character of candidates are not brought within the mischief of Section 123(4) , because the legislature thought that in the heat of election it may be permissible for competing parties and candidates to make statements in relation to the public character of their opponents, and even if some of the statements are false, they would not amount to corrupt practice. Having regard to this policy of the statute, it often becomes necessary to examine carefully whether the false statement impinges on the personal character of the candidate concerned. Though it is not easy to lay down any general considerations which would help the determination of this issue in every case, in actual practice it may not be very difficulty to decide whether the false statement impinges on the personal character of the candidate or on his public character. It would be inexpedient and undesirable to lay down any general principle in that behalf [vide , ; and v. Reddy, (1961) 22 Ele LR 261 (SC)]. ", "21. Let us now refer to the statements published in the \"Quami Ekta\" (Ext. P-22) which according to the appellant, constitute a corrupt practice under Section 123(4) of the Act. The said statements read as under:-- ", "\"1. that among those who drink, his rank is very high; ", "2. that he trimmed his beard which was contrary to the Sikh religion; ", "3. that he falsely claimed to be the Chief Minister's man and the C. I. D. Police, therefore, was after him; and ", "4. that he was an unprincipled 'chhokra'.\" ", "22. the and have held in the present proceedings that the first two statements have relation to the personal character of the appellant, whereas the last two have relation to his public character. We see no reason to differ from this conclusion. the and have also held that it is not shown that at the time when the statements were made, respondent No. 1 believed them to be false, or did not think them to be true. It is the correctness of this conclusion which is seriously challenged before us by Mr. . ", "23. It appears that a criminal case is pending between the appellant and respondent No. 1 in regard to this pamphlet, and the thought that having regard to the fact that the matter had gone before a criminal Court, it would be better if it did not make a specific and definite finding as to the falsity of the statements made in the pamphlet. Even so, the considered the oral evidence led by the parties and came to the conclusion which we have already mentioned. has adopted the same approach and has concurred with the findings of the . It appears that the oral evidence adduced by respondent No. 1 shows that the appellant was in the habit of taking drinks, and that he had trimmed his beard which is contrary to the Sikh religion. Having considered the said evidence, a finding has been made in favour of respondent No. 1 on the lines just indicated. ", "24. Mr. , however, contends that in reaching this conclusion, both the and have failed to take into account one important fact arising from the pleadings of the parties. He argues that in the petition filed by the appellant, he had specifically, clearly, and definitely averred that the publication of the pamphlet amounted to a corrupt practice on the part of respondent No. 1; and he points out that though respondent No. 1 denied that he had anything to do with the publication of the pamphlet, he did not traverse the plea made by the appellant that the impugned statements were false, that they concerned his personal character, and that they were believed to be false by respondent No. 1 and not believed to be true by him. Mr. 's case is that if respondent No. 1 did not specifically controvert the material allegations made by the appellant in his petition in respect of this charge, it was not open to the to allow respondent No. 1 to lead evidence in rebuttal; and both the and should have ignored that evidence and should have given full effect to the fact that respondent No. 1 had not denied the essential ingredients of the charge which had been specifically pleaded by the appellant in his election petition. In substance, the argument is based on the provisions of Order 8, Rule 5 of the Code of Civil Procedure: Mr. contends that the procedure prescribed by the Code applies to election proceedings; and so, he relies on the provisions of Order 8, Rule 5 in support of his argument that the present charge should have been held to be proved against respondent No. 1. ", "25. We are not impressed by this argument. In considering the question as to whether the strict rule of pleadings prescribed by Order 8, Rule 5 applies to election proceedings with all its rigour, we must bear in mind the fact that the charge like the present is in the nature of a criminal charge and the proceedings in respect of its trial partake of the character of quasi-criminal proceedings. It is true that Section 90 of the Act provides that subject to the provisions of this Act and of any rules made thereunder, every election petition shall be tried by the , as nearly as may be, in accordance with the procedure applicable under the Code of Civil Procedure, 1908, to the trial of suits. This provision itself emphasises the fact that the whole of the Civil Procedure Code is not fully applicable. What the section provides is that the proceedings should be tried \"as nearly as may be\" according to the Code of Civil Procedure. If the contention raised by Mr. is accepted at its face value, it may logically lead to this consequence that if a returned candidate does not controvert the allegations made by the petitioner in his election petition alleging the commission of a corrupt practice by the returned candidate, a finding would have to be made in favour of the petitioner without any evidence at all. In other words, the question is: can a corrupt practice prescribed by Section 123(4) of the Act be held to be proved merely on the ground that no specific denial has been made by the returned candidate in his written statement in that behalf? In considering this point, we cannot overlook the fact that the onus to prove the essential ingredients of Section 123(4) is on the petitioner, and so, it would be for him to prove that the statement is false, and that the other requirements of the section are satisfied. Having regard to the nature of the corrupt practice which is prescribed by Section 123(4) , we are not prepared to hold that the strict rule of pleadings prescribed by Order 8, Rule 5 of the Code can be blindly invoked in election proceedings of this type. ", "26. Besides, it is plain that there is a proviso to Order 8, Rule 5 which, in terms, confers jurisdiction on the that even if a fact can be deemed to be admitted by virtue of the said rule, it may nevertheless be proved otherwise than by such admission. This proviso clearly shows that even in civil proceedings to which the Code applies, it is open to the to exercise its discretion and require a party to prove a fact even though an admission of the said fact by the opponent can be inferred by the strict application of Order 8, Rule 5; and that is precisely what the has done in the present ease. When this question was argued before the , it examined the arguments urged by both the parties and held that in the interests of justice, it was necessary to allow respondent No. 1 to lead evidence in rebuttal; and it is in the light of the evidence led by respondent No. 1 that the made its finding on this issue against the appellant and the said finding has been confirmed by the High . Therefore, we do not think that the points of law raised by Mr. in respect of this charge really assist him to challenge effectively the correctness of the findings recorded by the s below. ", "27. Then as to the charge that the publication of certain statements and posters by respondent No. 1 amounted to a corrupt practice under the latter part of Section 123(4) , the position is not any better for the appellant. It is true that the publication of a false statement in relation to the candidature of the appellant would amount to a corrupt practice if the other ingredients of the said provision are satisfied. The and have held that the false statement on which the argument is founded, does not have any reference to the candidature of the appellant at all, and in our opinion, this conclusion is right. Let us briefly indicate why? ", "28. The poster in question reads thus:-- ", "\"IMPORTANT ANNOUNCEMENT OF , Amritsar Vote for Dear Khalsa Ji. ", "It is for your information that has nominated as its candidate. As the letter could not reach in time. Therefore he has been allotted the symbol of \"Tree\". We appeal to all the Akali workers and the that they should support him and make him successful. is the only tried Sewak of the . He has rendered great services during the Akali Morcha. Even now there is a warrant of arrest against him. The Sikh Masses should not labour under misunderstanding and they should help in flying the ic Flag high. ", ", , Vice-President. President. , , Urmur\". ", "No evidence has been brought on the record to show that either or signed this document. In fact, Master who was the President of has denied that he or had signed it; and so, in relation to the said two signatures the poster is a false document. It is also proved that respondent No. 1 is responsible for the publication of this document. But the question which arises for our decision is: does this document have relation to the candidature of the appellant? What this document purports to do is to ask the Akali workers and the to support the candidature of . The argument is that since the appellant had received the support of the party, this poster was intended to weaken the appellant's position by making a false representation to the followers of the that deserved their support, because he was the only tried of the . It seems to us that the requirement of Section 123(4) is plain and unambiguous. The impugned statement on which a charge under the said provision can rest, must be shown to be false, and must have relation to the candidature of the candidate. Now, this document and the other documents which were similarly published do not make any reference to the candidature of the appellant at all. Besides, it is significant that the appellant had not been adopted by the party as its official candidate, so that if the poster represented to the Akali workers that deserved their support, it cannot be said even by necessary inference or implication that the candidature of the appellant was referred to; perhaps such an inference could have been drawn if the appellant had been adopted as an official candidate by the party. ", "29. On the contrary, the evidence in the case shows that was intended to be adopted by the party as its official candidate. A telegram Ex. R. 2 was sent by , Amritsar to the Returning Officer requesting him to allot \"HAND\" which was the symbol of the , to who was an Akali candidate; but apparently, this telegram was received late and the symbol of \"Hand\" could not be allotted to . The evidence given by (R. W. 17) Secretary of the , clearly shows that the had nominated as a candidate and a telegram had been sent to the Returning Officer by , who was the General Secretary, under the authority of . Ex. Rule 3 shows that and had been authorised by the to request the Returning Officer to allot the adopted candidate the symbol chosen by the . It may be that ultimately, decided to support the appellant, and not ; hut that has no relevance on the point which we are considering under Section 123(4) Reading the impugned poster fairly, it is difficult to accept Mr. 's contention that the said poster makes a false statement in relation to the candidature of the appellant. That being so, it is unnecessary to consider whether the other requirements of Section 123(4) in relation to this poster are satisfied or not. ", "30. That leaves one more point to consider, and it is related to the order passed by the directing the inspection of the ballot boxes and examination of the voting papers cast by the electors in favour of the respective candidates. We have already noticed that the Election allowed the appellant to inspect the ballot boxes, examined the objections raised by the appellant in regard to the validity or invalidity of a large number of voting papers, and ultimately counted the votes cast in favour of the appellant and respondent No. 1. has found that the was in error in allowing inspection of the ballot boxes, and it has also held that the finding made by it after examining the objections raised by the appellant, is also not correct. It is unnecessary for us to consider this latter part of conclusion, because, in our opinion, was right in holding that no case had been made out by the appellant for the inspection of the ballot boxes at all. That being so, it is unnecessary to enquire what would he the result if the objections raised by the appellant are considered and the votes are recounted. So, the narrow question at his stage is: was the justified in allowing inspection of the ballot boxes in the present proceedings. ", "31. The true legal position in this matter is no longer in doubt. Section 92 of the Act which defines the powers of the , in terms, confers on it, by Clause (a), the powers which are vested in a under the Code of Civil Procedure when trying a suit, inter alia, in respect of discovery and inspection. Therefore, in a proper case, the can order the inspection of the ballot boxes and may proceed to examine the objections raised by the parties in relation to the improper acceptance or rejection of the voting papers. But in exercising this power, the has to bear in mind certain important considerations. Section 83(1)(a) of the Act requires that an election petition shall contain a concise statement of the material facts on which the petitioner relies; and in every case, where a prayer is made by a petitioner for the inspection of the ballot boxes, the must enquire whether the application made by the petitioner in that behalf contains a concise statement of the material facts on which he relies. Vague or general allegations that valid votes were improperly rejected, or invalid votes were improperly accepted, would not serve the purpose which Section 83(1)(a) has in mind. An application made for the inspection of ballot boxes must give material facts which would enable the to consider whether in the interests of justice, the ballot boxes should he inspected or not. In dealing with this question, the importance of the secrecy of the ballot papers cannot be ignored, and it is always to be borne in mind that the statutory rules framed under the Act are intended to provide adequate safeguard for the examination of the validity or invalidity of votes mid for their proper counting. It may be that in some cases, the ends of justice would make it necessary for the to allow a party to inspect the ballot boxes and consider his objections about the improper acceptance or improper rejection of votes tendered by voters at any given election; hut in considering the requirements of justice, care must be taken to see that election petitioners do not get a chance to make a roving or fishing enquiry in the ballot boxes so as to justify their claim that the returned candidate's election is void. We do not propose to lay down any hard and fast rule in this matter; indeed, to attempt to lay down such a rule would be inexpedient and unreasonable. ", "32. Whenever is called upon to consider this question, it should not ignore the safeguards which have been prescribed by the relevant Rules prescribed in Part V of the Conduct of Elections Rules, 1961. Let us briefly indicate the broad features of these Rules. Under Rule 53, candidates, their election agents or counting agents are admitted to the place fixed for counting of votes. Rule 54 emphasises the importance of the maintenance of secrecy of voting. Rule 55 deals with the scrutiny and opening of ballot boxes; before a ballot box is opened at a counting table, the counting agents present at that table shall be allowed to inspect the paper seal or such other seal as might have been affixed thereon and to satisfy themselves that it: is intact. The Returning Officer has himself to take care to see that no ballot box has been tampered with. In case any tampering of the ballot boxes is disclosed, the Returning Officer has to take action under Rule 58. Rule 56 provides for the scrutiny and rejection of ballot papers. Rule 56 (1) lays down that the ballot papers taken out of each ballot box shall be arranged in convenient bundles and scrutinised. Then objections are raised as specified by Sub-rule (2) and are dealt with in accordance with the provisions of other sub-clauses of Rule 56 (2). It is thus clear that the scheme of Rule 56 is that every ballot paper can be examined by the counting agent and objections can be raised in respect of it if the election agent feels that a valid objection can be raised. It is after these objections are examined and dealt with according to Rule 56 that the stage of counting votes arrives. Even after the completion of the counting, it is open to a candidate or his election agent to apply in writing to the Returning Officer for a re-count of all or any of the ballot papers already counted stating the grounds on which he demands such recount. That is the effect of Rule 63 (2). After all this procedure has been gone through, the Returning Officer completes the result sheet in Form 20, and signs it. Once that is done, no application for a re-count shall he entertained. We have referred broadly to the scheme of these Rules to emphasise the point that the election petitioner who is a defeated candidate, has ample opportunity to examine the voting papers before they are counted, and in case the objections raised by him or his election agent have been improperly over-ruled, knows precisely the nature of the objections raised by him and the voting papers to which those objections related. It is in the light of this background that Section 83(1) of the Act has to be appd to the petitions made for inspection of ballot boxes. Such an application must contain a concise statement of the material facts. ", "33. This question has been considered by this Court on several occasions. , , this Court observed that an order for inspection of ballot papers cannot be granted to support vague pleas made in the petition not supported by material facts or to fish out evidence to support such pleas. The case of the petitioner must be set out with precision supported by averments of material facts. To establish a case so pleaded an order for inspection may undoubtedly, if the interests of justice require, be granted. But a mere allegation that the petitioner suspects or believes that there has been an improper reception, refusal or rejection of votes will not be sufficient to support an order for inspection. The same view has been expressed in Smt. Dr. v. , (1964) C. A. No. 222 of 1964, D/- 18-3-1964 (), and in v. , (1965) C. A. No. 45 of 1965, D/- 10-2-1965. ", "34. Let us then examine whether the appellant's petition contained a concise statement of the material facts on which a claim for inspection of ballot papers can be justified. In the application made by the appellant on the 7th March, 1963, he urged that in the election petition filed by him, it had been averred that a very large number of votes purported to have been cast in favour of the appellant had been improperly rejected, and that has materially affected the result of the election; and he added that there was also an allegation that a large number of votes which were invalid had been improperly accepted in favour of respondent No. 1 which has also materially affected the result of the election. This application further sets out the appellant's version that the Returning Officer disclosed a partisan attitude and the counting and examination of votes was done in a very irregular manner. The appellant pleaded that he had led some evidence regarding the misconduct of the Returning Officer at the time of the counting; and so, a prayer was made that the ballot papers may be allowed to be inspected \"in order to enable the appellant to establish his case both regarding improper rejection and reception of ballot papers and the non-compliance with the rules under the Act on the part of the Returning Officer which have materially affected the result of the election in so far as respondent No. 1 is concerned\". It may be observed that at the time when the application for inspection was made, evidence had already been led before the ; and Mr. 's contention is that the , on considering the evidence in the light of the allegations made by the appellant, was satisfied that an inspection should be ordered in the interests of justice; and he argues that was in error in reversing this order on appeal. ", "35. We are not prepared to accept this contention. The order passed by the clearly shows that the did not apply its mind to the question as to whether sufficient particulars had been mentioned by the appellant in his application for inspection. All that the has observed is that a prima facie case has been made out for examining the ballot papers; it has also referred to the fact that the appellant has in his own statement supported the contention and that the evidence led by him prima facie justifies his prayer for inspection of ballot papers. In dealing with this question, the should have first enquired whether the application made by the appellant satisfied the requirements of Section 83(1) of the Act; and, in our opinion, on the allegations made, there can be only one answer and that is against the appellant. We have carefully considered the allegations made by the appellant in his election petition as well as those made by him in his application for inspection, and we are satisfied that the said allegations are very vague and general, and the whole object of the appellant in asking for inspection was to make a fishing enquiry with a view to find out some material to support his case that respondent No. 1 had received some invalid votes and that the appellant had been denied some valid votes. Unless an application for inspection of ballot papers makes out a proper case for such inspection, it would not be right for the to open the ballot boxes and allow a party to inspect the ballot papers, and examine the validity or invalidity of the ballot papers contained In it. If such a course is adopted, it would inevitably lead to the opening of the ballot boxes almost in every case, and that would plainly be inconsistent with the scheme of the statutory rules and with the object of keeping the ballot papers secret. That is why we are satisfied that was right in coming to the conclusion that the appellant had failed to make out a case for the inspection of the ballot boxes in this case. ", "36. Before we part with this appeal, we would like to refer to three matters which show that respondent No. 1 did not contest this litigation with clean hands. The has referred to the part played by respondent No. 2 in the present proceedings, and has made a bitter comment about the relation between and respondent No. 1. has referred to the sordid story about the part played by in collusion with respondent No. 1 in relation to the evidence which he gave in the present proceedings. Similarly, the part played by respondent No. 1 in assisting the adoption of a somewhat coercive and terrorising attitude in relation to who was a witness for the appellant, has also been criticised by the in strong words. While expressing our concurrence with the comments made by the and in regard to these three matters, we wish to express our strong disapproval of the course of conduct adopted by respondent No. 1 in relation to these three matters. We have no doubt that the said conduct of respondent No. 1 is wholly unworthy of the high position which he holds in public life. ", "37. The result is, tine appeal fails and is dismissed. There would be no order as to costs."], "relevant_candidates": ["0000273525", "0000447461"]} {"id": "0001002719", "text": ["PETITIONER: Vs. RESPONDENT: AND OTHERS. DATE OF JUDGMENT: 25/04/1954 BENCH: , BENCH: , MAHAJAN, , B.K. BOSE, VIVIAN BHAGWATI, CITATION: 1954 AIR 411 1955 SCR 140 CITATOR INFO : F 1955 SC 610 (4) R 1957 SC 397 (30) R 1959 SC 459 (50) F 1968 SC 22 (4) RF 1986 SC 441 (4) ACT: Constitution of India- Article 136- Supreme Court-If and when can interfere with findings of facts in appeal- Representation of the People Act (XLIII of 1951), ss. 85 , 90(4) -Requisites and finality of condonation of delay under s. 85 and powers conferred thereunder-Scope and extent of powers given to under s. 90(4) . HEADNOTE: Held, that does not, when hearing appeals under Article 136 of the Constitution, sit as a Court of further appeal on facts, and does not interfere with findings given on a consideration of evidence, unless they are perverse or based on no evidence and this is particularly so when the findings under challenge are those of Election s. The rights under litigation in election proceedings are not common law rights but rights which owe their existence to statutes and the extent of those rights must be determined by reference to the statutes which create them. The proviso to section 85 of the Representation of the People Act, 1951, does not contemplate giving to the respondent notice of the petition for condonation of the delay, or the holding of an enquiry as to the sufficiency of the grounds in his presence before passing an order under it. The policy underlying the provision is to treat the question of delay as one between and the petitioner, and to make the decision of on the question final and not open to question at any later stage of the proceedings. Under section 90(4) of the Act, when the petition does not comply with the requirements of section 81 , section 83 or section 117 , has a discretion either to dismiss it or not, \"notwithstanding anything contained in section 85 \". The scope of the power conferred on under section 90(4) is that it overrides the power conferred on under section 86 to dismiss the petition. It does not extend further and include a power in to review any order passed by under section 85 of the Act. The words of section 90(4) are, \"notwithstanding anything contained in section 85 \" and not \"notwithstanding anything contained in section 85 or any order passed thereunder\". An order of under section 85 dismissing a petition as barred will, under the scheme of the Act, be final, and the same result must follow under section 90(4) when the order is one excusing the delay. Section 90(4) will be attracted only when passes the petition on to the 141 without passing any order under section 85 . If can thus pass a final order condoning delay without notice to the respondent, there is no reason why it should not pass such an order suo motu. In this respect, the position under the proviso to section 85 is materially different from that under section 5 of the Limitation Act, under which an order excusing delay is not final and is liable to be questioned by the respondent at a later stage. The proviso advisedly confers on wide discretion in the matter, and the obvious intention of the was that is should be exercised with a view to do justice to all the parties. might therefore be trusted to pass the appropriate order when there is avoidable and unreasonable delay. That a power might be liable to be abused is no ground for denying it, when the statute confers it, and where there is an abuse of power by statutory bodies the parties aggrieved are not without remedies under the law. While the proviso to section 85 requires that \"the person making the petition\" should satisfy that there was sufficient cause for delay, it does not require that he should do so in person. ( S.C.R. 892); v. (45I.A. 25); v. (I.L 'R. 13 Mad. 269) referred to. JUDGMENT: ", "CIVIL APPELLATE JURISDICTION : Civil Appeal No. 25 of 1954. ", "Appeal by Special Leave granted by by its Order dated the 11th December, 1953, from the Judgment and Order dated the 16th November, 1953, of , Cuttack, in Election Case No. 4 of 1952. , ( , , and , with him) for the appellant. ", ", ( and , with him) for respondent No. 1. ", ", ( and , with him) for respondent No. 2. ", "1954. April 25. The Judgment of the Court was delivered by is an appeal by special leave against the order of , Cuttack, setting aside the election of the appellant to , Orissa, from the Kendrapara Constituency. Four persons, the appellant and respondents Nos. 1 to 3, were duly nominated for election to the seat. One of them, (the third respondent herein), withdrew his candidature, leaving the contest to the other three. At the election which was held between 9th and 15th January, 1952, the appellant secured the largest number of votes and was declared elected. The respondent , then presented a petition under section 81 of the Representation of the people (Act No. XLIII of 1951) alleging various corrupt practices on the part of the appellant, and praying that at the election might be set aside. The last date for presenting the petition was 4th April, 1952. It was delivered at the post office at Cuttack on 3rd April, 1952, for being sent by registered post, and actually reached at Delhi on 5th April, 1952, a day beyond the period prescribed. It was also defective in its verification. Section 83(1) of the Act enacts that the petition should be verified in the manner laid down in the Civil Procedure Code for the verification of the pleadings. Order VI, rule 15, sub- clause (2), of the Civil Procedure Code provides that \"the person verifying shall specify by reference to the numbered paragraphs of the pleading what he verifies on his own knowledge and what he verifies upon information received and believed to be true.\" The verification in the petition did not specify which of the paragraphs were verified on personal knowledge and which on information received and believed to be true. On 2nd July, 1952, passed an order condoning the delay in the presentation of the petition. By another communication, dated 3rd July, 1952, it drew the attention of the peti- tioner to the defect in the verification, and suggested that he might apply to the for amending it. On 15th July, 1952 an order was passed under section 86 of the Act appointing , Cuttack, for the hearing of the petition. The petitioner then applied to for amending the verification. That was ordered, and the verification was amended on 24th July, 1952, so as to conform to the prescriptions laid down in Order VI, rule 15(2), of the Civil Procedure Code. ", "143 ", "In the written statement filed by the appellant, he raised the contention that as the petition was presented out of time and as the verification was defective, it was liable to be dismissed by under section 85 of the Act, and that, in consequence, ought to dismiss it as not maintainable. Disagreeing with this contention, proceeded to hear the petition on the merits, and by its judgment dated 16th November, 1953, it held by a majority that three of the corrupt practices set out in the petition had been established against the appellant. They were (1) that the appellant had, in violation of section 123(1) of the Act, induced the third respondent to withdraw from the election on a promise to get him employment; (2) that he had, in breach of section 123(6) of the Act, used Bus No. O.R.C. 1545 for convoying the electors to polling booths; and (3) that he had, in contravention of section 123(8) of the Act, obtained the assistance of Extra Departmental Agents in branch post offices and of Presidents of in canvassing for him in the election, they being in the view of , Government servants as defined in that provision. On these findings, passed an order setting aside the election of the appellant. The matter now comes before us on special leave under article 136 of the Constitution. ", "It is obvious that any one of these findings, if accepted, would be sufficient to support the order of . With reference to the last of the findings, it is possible to urge with some force that Extra Departmental Agents and Presidents of are not, having regard to their functions, Government servants, and that accordingly there was no contravention of section 123(8) . But the position is different as regards the other two findings. They are pure questions of fact, depending on appreciation of evidence. Mr. , learned counsel for the appellant, argued that the conclusion of the majority were not justified by the evidence or record, and that the findings of the third member in his dissentient opinion were the right ones to come to But this does not, when hearing appeals under article 136 , sit as a of further appeal on facts, and does not interfere with findings given on a consideration of the evidence, unless they are perverse or based on no evidence. This is particularly so, when the findings under challenge are those of Election . the findings in this case that the appellant got the third respondent to withdraw on a promise to get him employment, and had used Bus No. O.R.C. 1545 for conveying voters to the polling booths, are supported by the evidence, and cannot be characterised as perverse, and are therefore not open to attack in this appeal. ", "in this view, counsel for the appellant concentrated on the issues relating to the maintainability of the petition. He contended that as the petition was not presented within the time as required by section 81 of the Act, it was liable to be dismissed under the mandatory provision in section 85 , and that when the matter came before , its jurisdiction was only to pass the order which ought to have passed, and that the petition should accordingly have been dismissed in limine us not maintainable. The proviso to section 85 of the Act runs as follows: ", "\"Provided that if a person making the petition satisfies that sufficient cause existed for his failure to present the petition within the period prescribed therefor, may in its discretion condone such failure.\" ", "It was in exercise of the discretion vested in it under this provision that condoned the delay by its order dated 2nd July, 1952. It is not disputed that if this order is valid, there can be no question of dismissing the petition on the ground of delay. The contention of Mr. is that the order is not valid, because it was passed not on any application of the party praying that the delay might be excused but suo motu; and such an application, it is contended, is a condition to the exercise of jurisdiction under that proviso, Support for this contention was sought in the decisions under section 5 of the Limitation Act, holding that it was incumbent, on the party praying that delay might be excused under that section to clearly allege and strictly prove the grounds therefor, We are not impressed by this contention. As was pointed, out by this Court in (1), the rights under litigation in these proceedings are not common law rights but rights which owe their existence to statutes, and the extent of those rights must be determined by reference to the statutes which create them. The proviso to section 85 does not contemplate giving to the respondent notice of the petition for con- donation of the delay, or the holding of an enquiry as to the sufficiency of the grounds in his presence before passing an order under it. The policy underlying the provision is to treat the question of delay as 'one between and the petitioner, and to make the decision of on the question final and not open to question at any later stage of the proceedings. Under section 90(4) of the Act, when the petition does not comply with the requirements of section 81 , section 83 or section 117 , has a discretion either to dismiss it or not, \" notwithstanding anything contained in section 85 .\" The scope of the power conferred on under section 90(4) is that it overrides the power conferred on under section 85 to dismiss the petition. It does not extend further and include a power in to review any order passed by under section 85 of the Act. The words of section 90(4) are, it should be marked, \"notwithstanding anything contained is section 85 \" and not \"notwithstanding anything contained in section 85 or any order passed thereunder.\" An order of under section 85 dismissing a petition as barred will-,, under the scheme of the Act, be final, and the same result must follow under section 90(4) when the order is one excusing the delay. Section 90(4) will be attracted only when passes the petition (1) A.I.R. 1954 S.C. 210 on to the without passing any order under section ", "85. If can thus pass a final order condoning delay without notice to the respondent, there is no reason why it should not pass such an order suo motu. In this respect, the position under the proviso to section 85 is materially different from that under section 5 of the Limitation Act, under which an order excusing delay is not final, and is liable to be questioned by the respondent at a later stage. [ Vide the decision of in (1)]. It was argued that in this view the respondent would be without remedy even if should choose to condone delays-it might be of years-, and that that would result in great hardship. But the proviso advisedly confers on wide discretion in the matter, and the obvious intention of the was that it should be exercised with a view to do justice to all the parties. might therefore be trusted to pass the appropriate order when there is avoidable and unreasonable delay. That a power might be liable to be abused is no ground for denying it, when the statute confers it, and where there is an abuse of power by statutory bodies, the parties aggrieved are not without ample remedies under the law. With particular reference to the order dated 2nd July, 1952, it is difficult to come to any conclusion other than that in passing that order the discretion under the proviso to section 85 has been properly exercised. The petition had been presented at the post office one day earlier, and reached one day later than the due date. Even if the matter had to be judged under section 5 of the Limitation Act, it would have been a proper exercise of the power under that section to have excused the delay. As was observed in the ,decision in v. ), in a passage which has become classic, the words \"Sufficient cause\" should receive \"a liberal construction so as to advance substantial justice when no negligence nor inaction nor want of bona fides is imputable to the appellant.\" We (1) 45 I.A. 25. ", "(2) I.L.R. 13 Mad. 269, have, therefore, no hesitation in holding that the order dated 2nd July, 1952, is on the facts a proper one to pass under the proviso to section 85 . ", "It wag also argued for the appellant that the power conferred by the proviso to section 85 could, on its true construction, be exercised only when the petitioner moved the matter in person, and as had found that that was not done, there was no jurisdiction in to pass the order which it did. We do not see anything in the language of the section to support this contention. While the proviso requires that \"the person making the petition \" should satisfy that there was sufficient cause for delay, it does not require that he should do so in person. And there is. nothing in the character of the proceedings requiring that the petitioner should make the representations under that proviso in person. It is only a question of satisfying that there was sufficient ground for excusing the delay, and that could be done otherwise than by the personal appearance of the petitioner. None of the objections advanced against the validity of the order dated 2nd July, 1952, being tenable, the contention that the petition was liable to be dismissed under section 85 as presented out of time must be rejected. ", "There is another ground on which also the contention of the appellant that the petition is not maintainable should fail. When the election petition came before by virtue of the order under section 86 of the Act, the appellant moved for its dismissal under section 90(4) on the grounds, firstly that it was not presented within the time prescribed by section 81 , and secondly, that it was not verified in accordance with section 83 ; but declined to do so. If it was within the competence of to pass such an order, that would itself furnish a complete answer to the contention of the appellant that the petition was not maintainable. Mr. sought to get over this difficulty by contending that the order of sending the petition for hearing by under section 86 of the Act, was without jurisdiction, because an order under that section could be passed only when the petition is not liable to be dismissed under section 85 as when the requirements of sections 81 , 83 or 117 are complied with ; but that when those provisions are not complied with, its only power under that Act was to dismiss it under section 85 ; that, in consequence, acquired no jurisdiction to hear the petition by virtue of that order, and that all the proceedings taken under it culminating in the order now under appeal were a nullity. This contention is, in our judgment, wholly untenable. The jurisdiction to pass an order under section 86 arises \"if the petition is not dismissed under section 85 .\" That has reference to the factual position whether the the petition was, in fact, dismissed under section 85 and not to the legal position whether it was liable to be dismissed. That is the plain meaning of the words of the section, and that is made plainer by section 90(4) which provides that, Not withstanding anything contained in section 85 , the may dismiss an election petition which does not comply with the provisions of section 81 , section 83 or section 117 .\" ", "This provision clearly contemplates that petitions which are liable to be dismissed for non-compliance with sections 81 , 83 or 117 might not have been so dismissed, and provides that when such petitions come before , it is a matter of discretion with it to dismiss them or not. The power of to condone delay in presentation or defective verification is thus unaffected by the consideration whether that petition was liable to be dismissed by under section 85 . The effect of an order under section 90(4) declining to dismiss the petition on the ground of delay or defective verification is clearly to condone those defects. In the instant case, with reference to the, plea of limi- tation the position stands thus: The delay was condoned by under the proviso to section 85 , and by reason of, that order, the question is,as already held no longer open to consideration at any later stage. Even assuming for the sake of argument that had no jurisdiction to pass an order of condonation suo motu, and further accepting the finding of that the order dated 2nd July, 1952, was so made, and that it was therefore a nullity, when the matter came before by transfer under section 86 , it had jurisdiction to pass appropriate orders under section 90(4) , and its order declining to dismiss the petition is sufficient to condone the defect. The position as regards verification is slightly different. There is no provision corresponding to the proviso to section 85 conferring express power on to permit amendment of the verification. Whether it has inherent power to permit such amendment, it is not necessary to decide, because when it did not, in fact, dismiss the petition under section 85 for not complying with section 83 and passed an order under section 86 appointing for the hearing of the petition, the matter is thereafter governed by section 90(4) of the Act, and it is a matter of discretion with either to dismiss the petition for defective verification or not. In the present case, directed the verification to be amended on 24 July, 1952, and further declined to dismiss the petition under section 90(4) for defective verification. These are not orders with which this will interfere in appeal under article 136 of the Constitution. ", "The objection to the maintainability of the petition on the ground of delay in presentation and of defective verification must therefore be overruled, and this appeal dismissed with costs. ", "Appeal dismissed. ", "150"], "relevant_candidates": ["0001011510", "0001292810"]} {"id": "0001015973", "text": ["PETITIONER: C.I.T. ANDHRA PRADESH Vs. RESPONDENT: M/S TAJ MAHAL HOTEL, SECUNDERABAD DATE OF JUDGMENT12/08/1971 BENCH: , A.N. BENCH: , A.N. CITATION: 1972 AIR 168 1971 SCC (3) 550 CITATOR INFO : R 1981 SC1274 (10) R 1985 SC 679 (32) RF 1986 SC 338 (7,11) RF 1987 SC1023 (31) RF 1988 SC1087 (8) R 1989 SC 335 (9) F 1989 SC 622 (4) RF 1991 SC 686 (16) RF 1991 SC 999 (14) F 1992 SC 129 (7) F 1992 SC1782 (10) ACT: Income-tax Act s. 10(2) (vi) and (vi-b)- 'Plant', meaning of. HEADNOTE: During the assessment year 1960-61, the assessee, a registered firm running hotels, incurred expenditure in installing sanitary and pipeline fittings in its hotels. On the question whether such fittings in a building run as a hotel fell within the meaning of the word 'plant' in s. 10(2) (vi-b) of the Income-tax Act , 1922, and the assessee was therefore entitled to development rebate under that sub- section, , in reference, answered in favour of the assessee. Dismissing the appeal to this Court, HELD: (1) Apart from the dictionary or literal meaning of the word 'plant', the context of the provisions of the Act shows that sanitary and pipe line fittings are 'plant' under s. 10(2) (vi-b) read with s. 10(5) . [173H; 174A-B] In computing the profits and gains of a business under s. 10(1) o the Act allowances by way of depreciation in respect of 'plant' under s. 10(2)(vi) and by way of development rebate in respect of 'plant' under s. 10(2) (vi-b) have to be made. Under s. 10(5) , 'plant' includes vehicles, books, scientific apparatus and surgical equipment purchased for the purpose of the,-business profession or vocation. Where a word is not defined in a statute, it must be construed in its popular sense, that is, that sense which people conversant with the subject-matter with which the statute is dealing, would attribute to it. The word 'includes' is generally used to enlarge the meaning of words or phrases used in the statute so that, words and phrases may be construed as comprehending not only such things as they signify according to their nature and import, but also these things which the interpretation clause declares that they shall include. The fact that even books have been included in 'plant' shows that the meaning given to 'plant' is wide. It should cover sanitary and pipe-line fittings. [170E-H; 171E-H, 173F] To have such fittings in a bath room is one of the essential amenities or conveniences which are normally provided in any good hotel, and the hotelier can reasonably expect to get more custom and earn a larger profit by charging higher rates. Therefore, the fittings in the present case, were not merely a part of the setting in which the hotel business was being carried on, but were required for the purpose of the hotel business. [173C- ., (1 970) 75 I.T.R. 533, approved. (Inspector of Taxes) v. , (1963) 1 W.L.R. 214, applied. 169 J. Lyons Co. Ltd. v. Attorney General, 1 Ch. 281 and Yar mouth v. France, 19 Q.B. 647, referred to. (2) The fact that the assessee while claiming depreciation allowance had included the fittings in question under the head 'furniture and fittings' and claimed higher depreciation allowance than what would be applicable to 'plant', would not detract from the meaning of the word 'plant' in s. 10(2) (vi-b). [174C-E] JUDGMENT: ", "CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1369 of 1968. Appeal from the judgment and order dated August 1, 1967 of in Case Referred No. 68 of 1964. ", ", , and , for the appellant. ", " and , for the respondent. The Judgment of the Court was delivered by , J.--This is an appeal by certificate from the judgment of in a case referred under s. 66(1) of the Income Tax Act, 1922 (hereinafter referred to as the Act). ", "The respondent who is the assessee is a registered firm running a hotel at Secunderabad with branches at Sultan Bazar and King Kothi in Hyderabad. During the previous year ending 30th September, 1959 relating to the assessment year 1960-61, the assessee incurred an expenditure of Rs. 57,154/- in installing sanitary fittings and of Rs. 1,370/- for pipe-line fittings. The assessee claimed development rebate on these two items at the rate of 25 per cent under S. 10(2)(vi-b) of the Act amounting in the aggregate to Rs. 14,629/-. The Income Tax Officer disallowed the claim. On appeal, the Appellate Assistant Commissioner upheld the disallowance. An appeal was taken to . The rejected the appeal holding that the definition of \"plant\" must necessarily be the same, whether it was for claiming depreciation under s. 10(2)(vi) or for development rebate under S. 10(2) (vi-b). Accordingly, it was held that the sanitary and pipe-line fittings did not fall within the meaning of the word \"plant\". On being moved under s. 66(1) of the Act, the following question was referred for the opinion of :- ", "\"Whether the sanitary fittings and pipelines, installed in the King Kothi branch of the , constituted 'plant' within the meaning of sec. 10(5) of the Indian Income-tax Act and whether the assessee is entitled to develop- ment rebate in respect thereof under sec. ", "10(2) of the Act answered the question in the affirmative and in favour of the assessee. ", "The only question that was argued before and which has been debated before us is whether sanitary and pipe-line fittings in a building which is run as a hotel would fall within the meaning of the word \"plant\" in section 10(2) (vi-b) of the Act. ", "Section 10(1) of the Act provides that tax shall be payable by an assessee in respect of the profits and gains of any business profession or vocation. Sub-section (2) gives the allowances which have to be made in computation of such profits and gains. Clause (vi) of that sub-section relates to the depreciation in respect of \"such buildings, machinery, plant or furniture being the property of the asses see\". ", "Clause (vi-b) of S. 10(2) is as follows:- ", "\"(vi-b) in respect of a new ship acquired or new machinery or plant installed after the 31st day of March, 1954, which is wholly used for the purposes of that business carried on by the assessee, a sum by way of development rebate in respect of the year of acquisition of the ship or of the installation of the machinery or plant, equivalent to........... ", "Section 10(5) provides inter alia that in sub-section (2) \" plant\" includes \"vehicles, books, scientific apparatus and surgical equipment purchased for the purpose of the business, profession or vocation\". ", "171 ", "The main argument of the learned counsel for the Commissioner of Income Tax who is the appellant is that the word \"plant\" should not have been given a wide meaning and should have been interpreted according to the common understanding in commercial circles among persons who deal in plant and machinery. It is asserted that the development rebate cannot be claimed in respect of the items which have become a part of the building itself. It has also been pointed out that the assessee while claiming depreciation allowance has included the assets in question under the head \"furniture and fittings\" the rate claimed being 9 per cent which was duly allowed by the Income Tax Officer. This rate of 9 per cent was applicable under Rule 8 only to furniture and fittings used in hotels etc. If the assets were to be treated as plant, only the general rate of 7 per cent would be applicable. The definition of \"plant\" must necessarily, therefore, be the same whether it be for claiming depreciation under s. 10(2)(vi) or for development rebate under s. 10(2) (vi-b). It has also been suggested that the primary meaning of the word \"plant\" has connection with mechanical or industrial business or manufacture of finis hed goods from raw goods and that sanitary and pipe- line fittings could not possibly satisfy those conditions. Now it is well settled that where the definition of a word has not been given, it must be construed in its popular sense if it is a word of every day use. Popular sense means \"that sense which people conversant, with the subject matter with which the statute is dealing, would attribute to it\". In the present case, s. 10(5) enlarges the definition of the word \"plant\" by including in it the words which have already been mentioned before. The very fact that even books have been included shows that the meaning intended to be given to \"plant\" is wide. The word \"includes\" is often used in interpretation clauses in order to enlarge the meaning of the words or phrases occurring in the body of the statute.\" When it is so used, these words and phrases must be construed as comprehending not only such things as they signify according to their nature and import but also those things which the interpretation clause declares that they shall include. The word \"include\" is also susceptible of other constructions which it is unnecessary to go into. ", "172 ", "The case- v. Attorney General (1) relied upon by the learned counsel for the appellant apart from being distinguishable hardly supports the contention of the appellant. In that case, it was I held that electric lamps and fittings in a tea shop were not part of the apparatus used for carrying on the business but were part of the setting in which the business was carried on, and, therefore, were not \"plant\", within the meaning of certain provisions of the War Damage Act, 1943. It was observed at page 286 \"if these articles are plant, it can only be by reason that they are found on premises exclusively devoted to trade purposes. Trade plant alone need be considered\".' The meaning of \"plant\" as given in v. France (2) was accepted as correct. According to that meaning \"plant\" includes whatever apparatus or instruments are used by a businessman in carrying on his business\". In our judgment, the more apposite decision is that of in (Inspector of Taxes) v. (3) There the nature of the assessee's business required that its office accommodation should be capable' of sub-division into a number of rooms varying in size etc. according to the requirements from time to time of the agencies which it carried on. The office accommodation consisted of a large open floor space in which partitions could be erected so as to subdivide the floor space into a number of rooms of any size. Certain partitions were made which were screwed to the floor and ceiling only and could be easily moved if it was desired to alter the size of number of the rooms. The question was whether these partitions were plant within sections 279 and 280 of the English Income Tax Act 1952, so as to entitle the company to allowances under those sections. There the material words in the statute were \"where the person carrying on a trade in any year of assessment has incurred expenditure on the provision of machinery or plant for the purposes of the trade.\" It was held that the partitions were \"plant\" as they were used in the carrying out of the company's trade or business. , L.J. held that the partitions were used to enable the trader to cope with the vicissitudes of (1) [1944] (1) Ch. 28 1. (2) [1887] (19) Q. B. 647. (3) [1963] (1) W.L.R. 214. ", "173 ", "the business as it increased and diminished and relied on the finding of the commissioners that the flexibility of accommodation which the partitions provided was a commercial necessity for the company. Further illustrations were given of assets which would fall within the meaning of \"plant\". \"The heating installation of a building may be passive in the sense that it involves no moving machinery, but few would deny it the name of plant\". The same thing could, no doubt be said of many air conditioning and water softening installations\". ", "It cannot be denied that the business of hotelier is carried on by adapting a building or premises in a suitable way to be used as a residential hotel where visitors come and stay and where there is arrangement for meals and other amenities are provided for their comfort and convenience. To have sanitary fittings etc. in a bath-room is one of the essential amenities or conveniences which are normally provided in any good hotel, in the present times. If the partitions in 's case (supra) could be treated as having been used for the purpose of the business of the trader, it is incomprehensible how sanitary fittings can be said to have no connection with the business of the hotlier. He can reasonably expect to get more custom, and earn larger profit by charging higher rates for the use of rooms if the bath-rooms have sanitary fittings and similar amenities. We are unable to see how the sanitary fittings in the bath- rooms in a hotel will not be \"plant\" within s.10(2)(vi-b) read with Section 10(5) when it is quite clear that the intention of the was to give it a wide meaning and that is why, articles like books and surgical instruments were expressly included in the definition of \"plant\". In decided cases, have rightly understood the meaning of the term \"Plant\" in a wide sense. ( .). (1) If the dictionary meaning of the word \"plant\" were to be taken into consideration on the principle that the literal construction of a statue must be adhered to unless the context renders it plain that such a construction cannot be put on the words in question-this is what is stated in Webster's Third New International Dictionary:- (1) (75) I.T.R. 533. ", "17 4 \"Land, buildings, machinery, apparatus and fixtures employed in carrying on trade or other industrial business...... ", "It is, however, unnecessary to dwell more on the dictionary meaning because looking to the provisions of Act, we are satisfied that the assets in question were required by the nature of the hotel business which the assessee was carrying on. They were not merely a part of the setting in which hotel business was being carried on. ", " was right in not accepting the reasoning of the based on the rates relating to depreciation under s.10(2)(vi) and the assessee having claimed that the sanitary and pipe-line fittings fell within the meaning of \"furniture and fittings' in Rule 8(2) of the Rules. It has been rightly observed that the Rules were meant only for the purpose of carrying out the provisions of the Act and they could not take away what was conferred by the Act or whittle down its effect. If the assessee had claimed higher depreciation allowance that would not detract from the meaning of the word plant in clause (vi-b) of S. 10(2) . In the result, this appeal fails and it is dismissed with costs. ", " Appeal Dismissed."], "relevant_candidates": ["0000453006"]} {"id": "0001047179", "text": ["PETITIONER: Vs. RESPONDENT: SALES TAX OFFICER, BHOPAL DATE OF JUDGMENT14/04/1977 BENCH: , SYED MURTAZA BENCH: , SYED MURTAZA BHAGWATI, P.N. UNTWALIA, N.L. CITATION: 1977 AIR 1275 1977 SCR (3) 578 1977 SCC (3) 147 CITATOR INFO : F 1988 SC1250 (7) ACT: Sales Tax--Dealer consuming goods for his own purposes--If a sale exigible to tax. HEADNOTE: The appellant was a manufacturer of sugar. It also ran in the mill premises a petrol pump selling high speed diesel oil, petrol and other lubricant oils of . A part of these oils was consumed by the appellant for its own trucks and other vehicles. The Sales tax authorities assessed to tax the petrol consumed by the appellant for its own use as well. On appeal the Commissioner of Sales Tax held that since the appellant was an agent of , title to the property in the goods sold by it remained with the principal and as such that part of the petrol and other oils consumed by it was also a sale exigible to tax. Allowing the appellant's appeal HELD: The petrol consumed by the appellant for its own purposes was not a sale exigible to tax. A conspectus of the terms of the agreement showed that after taking deliv- ery, the appellant became the owner of the goods and if it consumed the same for its own purposes, it was doing so not as an agent but as owner. [592 E] 1(a) In a contract of sale title to property in the goods passes on to the buyer on delivery of the goods for a price paid or promised. Once this happens the buyer becomes owner of the property and the seller has novestige of title left in the property. Having regard to the complexities of modern times the concept of sale has undergone a change and made a departure from the old doctrine of laissez faire. Even if the seller, by an agreement, imposed a number of restrictions on the buyer, such for example as, fixing of price, submission of statement of accounts, area of sale and so 6n these restrictions would not per se convert a contract of sale into one of agency. [581 H] (b) A contract of agency differs from a contract of sale inasmuch as an agent, after taking delivery of the property, does not sell it as his own but sells it as the property of the principal under his instructions and directions. [582 B] (c) While interpreting the terms of an agreement, the Court has to look to the substance rather than the form of the agreement. Use of words like \"agent\" or \"agency\", \"buyer\" and \"seller\" is not sufficient to lead to the infer- ence that the parties did in fact intend that the said status would be conferred. In certain trades, the word \"agent\" is often used without any reference to the law of principal and agent. [582 . 21 STC 313, 316 followed. and Sons v. LR. l KBD 710, 717, . ,4. Supp. SCR 1, 3-4 and ( , 80 ITR 213 referred to. v. 2 K B D I, v. (in Liquidation), 2 Scots. L.T. 205, v . 2 All. F.R. 386, 579 Willcox & Gibbs Sewing Machine Company v. , 35 U.S. Law. Ed. 882, 884 held inapplicable. In the instant case, the evidence furnished by the agreement was sufficient to conclude (a) that the goods were supplied not on consignment basis but by way of outright sale; (b) that the agreement was to sell petrol and other oils, after the dealer had bought the property from , at prices fixed by that company; (c) that stipulation of sale price was to protect the company's goodwill and to ensure quality of goods to be distributed-in fact stipula- tion of price which is generally a common term in all agree- ments between monopolistic companies and their distributors did not detract from the freedom of contract of sale; (d) sale by the appellant to other customers did not disclose that the property belonged to ; (e) it was the appel- lant that bore losses due to leakage, driage and evaporation in storage and (f) reimbursement by the company of transport charges and handling expenses and also reimbursement of supplies made by the appellant to certain designated custom- ers showed that the agreement was a contract of sale and not of agency. Further, the term requiring the dealer to furnish state- ments of sales and other matters showed that the company wanted to keep itself fully informed of the proper conduct of the business in order to maintain its goodwill and to terminate the agreement in case it found that the appellant was misusing the privilege given to it. The term \"commis- sion and allowances\" indicated that certain special benefits were conferred by the company on its distributors. It did not show that it was an agency. Nor was the term requiring the appellant to furnish security for the due observance and performance of the stipulations an indication that the agreement was an agency. , AIR 1919 P.C. 166, 167 referred to. , AIR 1956 Cal. 188 ap- proved. JUDGMENT: ", "CIVIL APPELLATE JURISDICTlON: Civil Appeals Nos. 1135- 1138 of 1972. ", "Appeals by Special Leave from the Judgment and Order dated the 5th May, 1970 of the Commissioner of Sales Tax, Madhya Pradesh in Revision Case Nos. 2-5/RMS of 1968-1969 respectively. ", ", (Mrs.) and for the Appellant. ", ", H.S. Parihar and 1. N. Shroff for Re- spondent. ", "The Judgment of the Court was delivered by FAZAL ALl, J.--These appeals by special leave are di- rected against the order of the Commissioner of Sales Tax dated May 5, 1970 rejecting the revision filed by the appel- lant before him against the order or' the Appellate Assist- ant Commissioner, Sales Tax, imposing sales tax. The appellant filed an appeal against the order of the respondent-Sales Tax Officer--to under the Madhya Pradesh Sales of Motor Spirit and Taxation Act , 1957 hereinafter referred to as 'the Act'--and pari pasu filed a petition under Art. 226 of the Constitution in challenging the constitu- tionality of the Act and the assessments made in pursuance thereof. , by its judgment dated January 25, 1961, dismissed the petition of the' appellant\". The appellant. then approached this Court through a special leave petition and also a petition under Art. 32 of the Constitution but without any suc- cess. This Court by its judgment dated December 21, 1962, held that had erred in assuming jurisdiction in deciding disputed questions involved in the petition and should have insisted on the appellant to move provided under the Act. The petition under Art. 32 , however, .was allowed by this Court and a part of the definition of \"sale\" in s. 2(1) of the Act was declared ultra vires. In the instant case, however, we are not concerned with this aspect of the matter. ", "In compliance with the orders of this Court, the appel- lant filed an appeal before the Appellate Assistant Commis- sioner of Sales Tax which was allowed by his order dated March 6, 1963, and the case was remanded to the Sales Tax Officer for fresh assessment after making necessary en- quiries. Thereafter the respondent Sales Tax Officer assessed the appellant afresh by his order dated October 20, 1963, and made similar assessments for the other periods. Against this order the appellant moved this Court again but ultimately withdrew the petition and filed 'a revision petition under s. 28 of the Act to the Commissioner of Sales Tax, Madhya Pradesh. The Commissioner, after hearing the arguments of both the parties, invited further documents and after making further queries upheld the order of the Appel- late Assistant Commissioner of Sales Tax holding that the appellant was liable to pay sales tax inasmuch as the con- tract which was entered into between the appellant and was a pure and simple contract of agency and not a contract of sale. The Commissioner opined that as the contract was one of agency, the title to the property remained in the and if the appellant used the petrol for its own purposes as agent, then such a user would amount to a sale of the property of the by the agent to itself so as to he exigible to sales tax. It is against the order of the Commissioner dated May 5, 1970 that the appellant has come up to this Court after obtaining special leave. ", "We have heard counsel for the parties at very great length and we have also gone through the documents flied by the parties before the Commissioner and incorporated in the Paper Book. It seems to us that the only point for deci- sion lies within a very narrow compass. The short point to be decided is whether at the time when the appellant was consuming the high speed diesel oil and petrol for its own purposes, was it doing so as owner of these articles or merely as an agent of ? In other words, if it is held that as a result of the agreement between and the appellant and the transactions following thereupon the title to the diesel or petrol passed to the appellant by the delivery of these articles, then from that date the appel- lant became owner of these articles and was entitled to use them as he liked, because he had already paid the price of the diesel and petrol received by it. If this be the position, then it is manifestly clear that the user by the appellant for its own purposes may not amount to a sale which had already taken place at a point of time when the goods were delivered by the to the appellant. On the other hand, if it is held that the appellant was a mere agent under the agreement and was selling the articles on behalf of its principal--the --then any user of these articles or properties may amount to a sale so as to be exigible to sales tax. We may add that even then it was contended for the appellant that it would not amount to sale, but it did not press his contention later. The question, therefore, will have to be determined having regard to the terms and recitals of the agreement, the intention of the parties as may be spelt out from the terms of the documents and the surrounding circumstances and having regard to the course of dealings between the par- ties. In all the Sales Tax statutes as also the definition of \"sale\" in the Act in this case, the definition given in the Sale of Goods Act has been bodily lifted from that Act and inserted in the Tax Statutes. In the instant case under the Madhya Pradesh Sales of Motor Spirit Taxation Act, 1957, \"sale\". is defined thus: ", "\" \"sale\" with all its grammatical variations and cognate expressions means transfer of motor spirit for cash or deferred payment or for other valuable consideration and includes transfer of motor spirit by a society or club or any association to its members, but does not include a mortgage hypothecation, charge or pledge; ", "Explanation l.---Consumption of motor spirit by a dealer himself or on his behalf shall be deemed to be a \"sale\"; ", "Explanation II.---A sale of motor spirit deemed to be a sale inside the State within the meaning of sub-section (2) of section 4 of the Central Sales Tax Act, 1956 , shall also be deemed to be sale inside the State for the purposes of this clause;\" ", "Thus it would appear that in order to satisfy the conditions of \"sale\" under the definition of the Act, the following conditions must be satisfied: ", "(i) that there should be a transfer of motor spirit from the seller to the buyer; ", "(ii) that the transfer must be for valu- able consideration which may be either cash or deferred payment; and ", "(iii) that the transfer must not be in the nature of a mortgage, hypothecation, charge or pledge. ", "Under Explanation I, consumption of motor spirit by a dealer himself or on his behalf shall be deemed to be a sale. But this Explanation has already been held to be ultra vires by this Court in the previous case. Thus the essence of the matter is that in a contract of sale, title to the property passes on to the buyer on delivery of the goods for a price paid or promised. Once this happens the buyer becomes the owner of the property and the seller has no vestige of title left in the property. The concept of a sale has, however, undergone a revolution- ary change, having regard to the complexities of the modern times and the expanding needs of the society, which has made a departure from the doctrine of laissez faire by including a transaction within the fold of a sale even though the seller may by virtue of an agreement impose a number of restrictions on the buyer, e.g. fixation of price, submission of accounts, selling in a particular area or territory and so on. These restrictions per se would not convert a contract of sale into one of agency, because in spite of these restrictions the transaction would still be a sale and subject to all the incidents of a sale. A contract of agency, however, differs essentially from a contract of sale inasmuch as an agent after taking delivery of the property does not sell it as his own property but sells the same. as the property of the principal and under his instructions and directions. Furthermore, since the agent is not the owner of the goods, if any loss is suffered by the agent he is to be indemnified by the principal. This is yet another dominant factor which distinguishes an agent from a buyer--pure and simple. In , Vol. 1, 4th Edn., in para 807 at p. 485, the following observations are made: ", "\"The relation of principal and agent raises by implication a contract on the part of the principal to reimburse the agent in respect of all expenses, and to indemnify him against all liabilities, incurred in the reasonable per- formance of the agency, provided that such implication is not excluded by the express terms of the contract between them, and pro- vided that such expenses and liabllities are in fact occasioned by his employment.\" ", "We have mentioned this fact, particularly because under the agreement between and the appellant the loss sustained by the buyer has to be borne by it after delivery of the goods and the seller is not responsible for the same. Such a special arrangement between the parties is a factor which taken along with other circumstances points towards the agreement being one of sale. It is well settled that while interpreting the terms of the agreement, the has to look to the substance rather than the form of it. The mere fact that the word 'agent' or 'agency' is used or the words 'buyer' and 'sell- er' are used to describe the status of the parties concerned is not sufficient to lead to the irresistible inference that the parties did in fact intend that the said status would be conferred. Thus the mere formal description of a person as an agent or buyer is not conclusive, unless the context shows that the parties clearly intended 'to treat a buyer as a buyer and not as an agent. Learned counsel for the appel- lant relied on several circumstances to show that on a proper construction of the agreement it could not but be held to 'be a contract of sale. Learned counsel strongly relied on a decision Of this in ,(1) where this held the transaction to be a sale in almost similar circumstances. Speaking for the , , J., observed as follows: (1) 21 S.T.C. 313; 316 \"As a matter of law there is a distinction between a contract of sale and a contract of agency by which the agent is authorised to sell or buy on behalf of the principal. The essence of a contract of sale is the transfer of title to the goods for a price paid or promised to be paid. The transferee in such a case is liable to the transferor as a debtor for the price to be paid ; and not as agent for the proceeds of the sale. The essence of agency to sell is the delivery of the goods to a person who is to sell them, not as his own property but as the property of the principal who continues to be the owner of the goods and will therefore be liable to account for the sale proceeds.\" ", "It is clear from the observations made by this Court that the true relationship of the parties in Such a case has to be gathered from the nature of the contract, its terms and conditions, and the terminology used by the parties is not decisive of the said relationship. This Court relied on a decision in v. (1) where despite the fact that the buyer was designated as sole selling agent, the Court held that it was a contract of sale Lord , with whom other Lords agreed, observed as follows: ", "\"Now it is well known that in certain trades the word \"agent\" is often used without any reference to the law of principal and agent. The motor trade offers an obvious example, where persons described as \"agents\" are not agents in respect of any principal, but are purchasers who buy from manufacturers and sell independently of them; and many difficulties have arisen from this habit of describing a purchaser, sometimes a purchaser upon terms, as an agent.\" ", "In a earlier decision of this Court in . (2) it was observed thus: ", "\"The essence of sale is the transfer of the title to the goods for price paid or to be paid. The transferee in such case becomes liable to the transferor of the goods as a debtor for the price to be paid and not as agent for the proceeds of the sale. On the other hand, the essence of agency to sell is the delivery of the goods to a person who is to sell them, not as his own property but as the property of the principal who continues to be the owner of the goods and who is therefore liable to account for the proceeds.\" in v. ", "Commissioner of Income-tax (Central) Bombay(3) had, in almost similar facts, held that even though there were restrictions on the assessee, the agreement being one of distribution was to be treated as a contract of sale and not an agreement of agency. It would thus appear that (1) L.R. [1932] I K.B.D. 710, 717. ", "(2) [1966] Supp. S.C.R. 1,34. ", "(3) 80 I.T.R. 213 even if a party is described as agent in the agreement he may not be an agent but a buyer though described as an agent. In fact we feel that there may be agreements which may contain some elements of agency but may be-contracts of sale in other respects. ", "Learned counsel for the respondent then relied on the decision in v. ) This author- ity does not appear to be of any assistance to the respond- ent because in that case the court came to a finding of fact that there was no concluded contract at all and the agree- ment was merely an executory one and, therefore, the ques- tion of determining the relationship between the parties did not naturally arise. ", "Similarly reliance was placed on v. (in Liquidation).(2) Here also the question was decided on the peculiar terms of the agreement in question and this authority cannot be called into aid for the purpose of deciding the present case. ", "Learned counsel for the respondent also relied on v. Stimson(3) but the facts in the aforesaid case appear to be quite different from the facts of the present case. ", "Strong reliance was also placed by Mr. Panjwani coun- sel for the respondent on v. ) where the Court observed as follows :: ", "\"And it is agreed and understood that this appointment or agency is not saleable or transferable by second party without obtaining the written consent of first party, but such consent is to be given providing the purchaser or other person is acceptable to said first party.\" ", "\"There was some discussion at the bar as to whether was, strictly, an agent of the company. We think he was. He was none the less an agent because of his appointment as \"exclusive vendor\" of the defendant's machines within a particular territory, or because of the peculiar privileges granted to or the peculiar restrictions imposed upon him\" ", "It seems to us that the law on the subject has been stated by the in a different context and, therefore, this case does not appear to us to be of any assistance in deter- mining the question at issue in the instant case. The ' in the aforesaid case had inferred agency from the mere fact that under the agreement the sale was to operate in a limited territory. This by itself, in our opinion, is not sufficient to lead to the inference that the agree- ment was one of agency. It is (1) [1934] 2K.B.D. 1. ", "(2) [1917] 2 Scots. L.T. 205. ", "(3) [1962] 3 All E.R. 386. ", "(4) 35 U.S. Law. Ed. 882,884. ", "585 ", "always open to the buyer to purchase goods for a limited purpose and within the field of that limited purpose the buyer has absolute to the property once it is delivered to him by the seller. ", "Learned counsel for the respondent then relied on a deci- sion of in - tax and Sales Tax, Trivandrum,(1). But that decision is contrary to the principles enunciated by this Court in case (supra) and case (Supra). Moreover, as pointed out by in that case there were special terms and stipulations in the contract which persuaded the to hold that it was a contract of agency. We would, therefore, like to confine the ratio of that case to the peculiar facts of that case. Further, it appears that while had expressly dissented from a decision of in (1) and did not accept the propositions laid down by the said Court, this Court had affirmed the aforesaid decision in (3) where it was observed thus: ", "\"We therefore agree with the view of that clause 24 does not qualify the legal effect of the other important clauses of the agreement, and that the cement delivered, despatched or consigned by the manufacturing companies to or to its orders or in accordance with its directions was sold by the manufac- ", "turing companies to ...... \" ", "In view of the observations of this Court, therefore, the decision referred to above must be held to have been impliedly overruled. ", "Having discussed the law 'on the subject, we shall now analyse the agreement in the present case and interpret the same m accordance with the principles laid down by the various authorities referred to above. To begin with, clauses 1 and 2 express in absolutely categorical terms that the nature of the agreement is to sell the property in question and nothing else. Clause 2 runs thus: ", "\"The Company shall sell to the dealer and the dealer shall buy from the Company the said products at the prices preestablished by the Company therefore and which are in effect on the date on which the Diesel Oil is des- patched/or delivered by the Company.\" ", "Clause 2 expressly states that Hispeedol was to be sold and the dealer was b in the property from the at prices to be fixed by the . The terms \"buying\" and \"selling\" have not been used by way of a routine or formal description of the status of the parties (1) 12 S.T.C. 464. ", "(2) 9 S.T.C. 248. ", "(3) 12 S.T.C. 615,622. ", "586 ", "but appear to us to form an integral part of the contract clearly exhibiting an intention of the nature of transaction which the parties intended tiffs document to be, namely, that it is a contract for sale and nothing else. We must remember that the agreement in question is a contract for distribution of Hispeedol produced by which has a monopoly for producing a particular type of oil which it sells. A common feature of any distribution agree- ment is that the seller insists on a particular price at which the property is to be sold and impose certain restric- tions in order to protect his goodwill and ensure the quali- ty of his goods to be distributed through sale. The chart filed by the appellant at p. 191 of the Paper Book would clearly show that the appellant paid the price of the bulk supplies almost within a month of the date of delivery of the goods. This chart runs thus: ", "\"A. H. Bhiwandiwalla & , Managing Agents, , Sehore, Cash Debit voucher No.. 2011, dt. 1-7-1958. ", "\"Please pay to. M/s. Caltex (India) Ltd., Account: Petrol Diesel Oil & lubricants. ", "In full payment of the following bills Rs .-np. No. 19232 dt. 9-4-58 for 1000 Gs. petrol Rs. 2920-00 No. 19283 dt. 8-5-58 for 1000 Gs. petrol Rs. 2920-00 No. 19321 dt. 29-5-58 for 1000 Gs. petrol Rs. 2920-00 8760-00 No. 17586 dt. 1-5-58 for 1000 Gs. Hispeedol Rs. 1770-00 No. 17593 dt. 7-5-58 for 1000 Gs. ,, Rs. 1770-00 No. 17610 dt. 14-5-58 for 1000 Gs. ,, Rs. 1770-00 No. 17621 dt. 18-5-58 for 860 Gs. ,, Rs. 1540-00 6850-00 ", "-------------- ", "Rupees fifteen thousand six hundred ten only. 15610-00 ", "---------------------------------------------------------- ", "For the Sd/- Illegible Manager. \" ", "This chart also reveals a crucial fact, namely, that the supply of the products by the Company was made to the appel- lant not on consignment basis but by way of outright sale. It appears from the documents produced by the appellant before the Commissioner that on inquiries made from the seller, namely, , they confirmed the fact that the goods were sent to the buyer on the basis of out- right sale. In this connection, the relevant portion of the letter read thus: ", "\"We refer to 'the discussion your Mr. had this forenoon with our M/s. and ...... ", "In this connection we would like to confirm as under \"1. Since the inception of your dealership, clause No. 4 of our Standard Petrol Dealer Agreement does not apply to you. ", "2. Supplies of Petroleum Products ex Bombay or ex our Depots in Madhya Pradesh have been made to you on the basis of outright sale.\" ", "This letter also shows that clause 4 of the Standard Petrol Dealer Agreement did not apply to the appellant. Similarly another letter at P. 167 of the Paper Book written by the Manager of the appellant to the Commissioner of clarified the position that the appellant had purchased the goods on outright basis. The relevant portion of this letter may be extracted thus: ", "\" , never supplied goods i.e. petrol & Hispeedol on consignment basis. We had always purchased the goods from them on out-right purchases against our orders placed with them from time to time. Sample copies of our correspondence relating to placement of orders in respect of petrol & hispeedol are enclosed herewith for your perusal.\" ", "The appellant had filed detailed correspondence to prove the facts clarified before the Commissioner. This aspect of the matter was further reiterated by the appellant in his letter to the Commissioner' dated November 7, 1969, the relevant portion of which may be extracted as follows: ", "\" supplied us petrol & hispeedol against our orders placed with them from time to time and they billed us immedi- ately thereafter at the bulk rates prevailing from time to time ....... Payments were also made to on outright basis immediately after receipt of the goods ....... ", "All books of account, all files contain- ing orders, bills, payment vouchers and correspondence are produced before you for your verification.\" ", "This letter further shows that all the vouchers, corre- spondence etc. had been produced 'by the appellant in proof of the recitals mentioned in the letter. It is, therefore, clear that the moment the appellant received the supplies of Hispeedol from the seller, the Hispeedol became the property of the appellant and the appellant was absolutely free to sell the Hispeedol and petrol to any one it liked at the prices fixed within the territory specified in the agreement. Thus the title to the property passed to the appellant the moment it took delivery of the same. It is, therefore, manifest that having taken delivery of the property if the appellant was using it for its own consump- tion it was using its own property in which the Company had no title at all and such a user therefore could not, by any stretch of imagination, be treated as a sale. ", "588 ", "Another very important circumstance which clearly shows that the contract was one of sale and not of agency is the fact that after having taken delivery of the petrol and Hispeedol the appellant sold the same to its various custom- ers, not even mentioning that the property belonged to but issued cash memos in its own name which clearly indicates that after taking delivery of the property the appellant became the absolute owner thereof and repre- sented itself to be the owner of the property and sold it not as the property of the but as its own property. This fact is clearly proved, by the cash memos and credit vouchers produced by the appellant at pp. 195-197 of the Paper Book. The cash memo describes as the owner of the goods and so does the credit voucher.- This, therefore, conclusively shows that the agreement could not have been an agreement of agency because the essential distinction between an agreement of sale and agreement of agency is that in the former case the property is sold by the seller as his own property and in the latter case the property is sold by the agent not as his own property but as the property of his principal and on his behalf. ", "Another important circumstance which indicates that the goods were sold to the appellant is that the appellant in his letters produced on further queries made by the Commis- sioner of sales Tax made a clear statement that the appel- lant had borne the losses due to leakage, driage, evapora- tion etc. during the course of storage at the pumps of the appellant and the seller did not reimburse the appellant for such losses. The relevant portion of this letter may be extracted thus: ", "\"As we had purchased petrol & hispeedol on out-right purchase and sale basis from , we borne the entire losses arising out of entire expenses or handling at our receiving point. We also borne the losses due to leakages, driage and driage and/or evaporation during the course of storage at our pumps. , did not reimburse us for any loss.\" ", "If the appellant would have been agent of the then under the law of agency the agent had an indefeasible right to be reimbursed or indemnified by the principal for the losses caused. But as the appellant bore the losses person- ally, this clearly indicates that the properties after being sold to it were its absolute properties and if any losses occurred they were borne by the appellant as owner and not by the seller. ", "Another important condition in the agreement was clause 23 at p. 130 of the Paper Book which runs thus: ", "\"The dealer shall at any time, upon request of the make from his stocks, deliveries of reasonable quantities of said products for account of the , to con- sumers at such points within the territory as the may designate. In consideration of his making such deliveries, the dealer shall be reimbursed in full for all transportation expenses, and receive in addi- tion thereto, such allowances for handling as may then currently be in effect under this agreement.\" ", "Under this clause the appellant was required to deliver reasonable quantities of products at the request of the to consumers designated by the at such points within the territory as may be specified. In consid- eration of complying with the request, the seller agreed to reimburse the appellant in full for the supplies and the appellant was also entitled to be paid transporta- tion expenses and handling allowances as may have been incurred by it. This is another decisive factor which negatives the theory that the agreement could be one of agency. Indeed such a stipulation in the agreement is wholly inconsistent with the position of the appellant being an agent for in that case there was absolutely no scope for such a stipulation and the seller as a principal of the agent could have instructed it to supply the goods or petrol to designated customers and there was no question of the agent being reimbursed, because the property supplied belonged to the principal and was delivered to certain persons on the instructions of the principal. This clause, therefore, is yet another important factor which shows that the agreement was intended to be a contract of sale rather than a contract of agency. ", "Furthermore, the agreement contains a clear and unequivocal declaration by the seller Company that the status of the appellant woUld not be that' of an agent. In this connection, clause 15 of the agreement runs thus: ", "\"Nothing in this agreement contained shall in any way operate by implication or otherwise to constitute the dealer as agent of the in any respect and for any purpose whatsoever, and the dealer shall have no right or authority to assume or create any obliga- tion of any kind express or implied on behalf of the in any other respect whatsoev- er.\" ", "This clear declaration on the part of the parties leaves no\" room for doubt that the agreement was intended to be a contract for sale and that the appellant was not only not regarded as an agent but was expressly excluded from the category of an agent. ", "The cumulative effect of the circumstances mentioned above leads to the inescapable conclusion that the had been sold to the appellant and not held by it merely as an agent of . The petrol agreement also which has been placed before us contains similar stipu- lations and it was not disputed by counsel for the respond- ent that if the Agreement is held to be a con- tract of sale, then the same would have to be said of the Petrol Agreement also. Thus the principles which would make the contract of the purchase of a contract of sale would apply mutatis mulandis to the Petrol Agreement also. Learned counsel for the respondent, as also the Commis- sioner, have relied on certain stipulations in the agreement which show that the 11--502 SCI/77 agreement was one of agency. The first circumstance relied in this connection was that under clause 12 of the agree- ment, the appellant was to maintain sale, service and other record as may be considered necessary and was to furnish the when called upon statements of sales, financial and other matters as and when required by the . Clause 12 runs thus: ", "\"The dealer shall maintain sales, serv- ice, and other record as may be considered necessary by the and shall furnish the when called upon with all such sales, financial and other statements as may be required by and in forms satisfactory to the .\" ", "In our opinion this clause does not at all conclusively show that the appellant was an agent of the Company. The object of inserting this clause in the agreement appears to be that during the term of the agreement the appellant undertook to maintain proper sales, service and other record so that the Company's reputation may not suffer and if any statement regarding the sales or other matter were required by the Company, they were not required because the appellant was the agent of the Company but it was because the Company wanted to keep itself fully informed of the proper conduct of the business by the appellant in order to maintain its goodwill. It is manifest that if during the period of the agreement there were serious complaints against the appellant regarding the misuse of the privileges given to it under the agreement, the Company could under the terms of the agreement terminate the agreement so as to 'save its reputation. Read as a whole, this stipulation does not amount to make the appellant liable to render regular accounts to the Company inasmuch as the statements called for were required only for a very limited purpose, viz., to prevent the appellant from misusing his privileges and thereby jeopardising or harming the reputation of . In these circumstances, therefore, the argument based on this clause appears to be of no assistance to the counsel for the respondent. ", "Clause 8 of the agreement clearly shows that the appel- lant had been loaned properties belonging to the Company like petrol pumps and their accessories etc. and it was in respect of these properties which had been given to the dealer for working the petrol pumps that the statements of account were called for from the appellant. This ap- pears to be the modus operandi adopted by the seller Company in respect of all its distributors. There is no stipulation in the agreement which requires or enjoins on the appellant to submit accounts of the Hispeedol or petrol which he may have sold to various customers, after having taken deliv- ery of the same from the Company. In these circumstances, therefore, this argument of the learned counsel for the re- spondent must be overruled. ", "Another circumstance relied upon by the respondent was the fact that the appellant was under the terms of the agreement to sell the goods at a price fixed and not higher or lower than that. We have already indicated that when a enters into a distribution agreement it always fixes a particular price in order to protect its goodwill and in order to control the market. Such fixation of the price by itself would not be a restriction which would take away the freedom of contract of sale. Such a stipulation is found in almost all the agreements entered into between the monopolist and their distributors. The respondent would not, therefore, be justified in treating this circum- stance in order to show that the agreement was one of agency. ", "Similarly the argument that the appellant was to sell the goods in a territory fixed by the does not show that the agreement was not of sale because this is also one of the common features of a distribution agreement. The question to be determined is not what was the territory fixed by the seller but whether there was any limi- tation to sell to any particular person within the territory for which the properties were sold to the appellant. On this point there is absolutely no restriction. It was further contended that under clause 26 of the agreement the agreed to pay a commission and certain allowances to the appellant which shows that the appellant was an agent The relevant portion of clause 26 runs thus: ", "\"In consideration of the dealer under- taking faithfully, to carry out their part of the Agreement as set for the above, the undertakes to pay the dealer such commission and allowances as the in its sole discretion shall think fit. The rate of commission and allowances that are current at the time are setforth in the schedule attached hereto, but the reserve the right to alter such corn. mission and allow- ances as and when they. think fit without any previous notice to the dealer and without assigning any reason therefore.\" ", "A perusal of this clause as a whole would show that the use of the words \"commission and allowances\" is not to indicate agency, but to indicate certain special benefits which the Company wanted to confer on its distributors. Furthermore, then payment of commission by itself is not conclusive to show that the agreement was one of agency. , (1) Lord observed as follows: ", "\"It comes to this, that all the documents show on the face of them a contract as between principals. The mere mention of commission in the contract as signed is not in any way, as pointed by the learned Judges of , inconsistent with the relation being between principal and princi- pal.\" ", "This decision was followed by in (2) and we find ourselves in complete agreement with the view taken by the Calcutta (1) A.I.R. (1919) P.C. 166, 167. ", "(2) A.I.R. (1956) Cal. 188 High Court. For these reasons, therefore, the argument by learned counsel for the respondent is not tenable in law. Finally, reliance was placed on clause 18 of the agree- ment appearing at p. 126 of the Paper Book which requires the dealer to furnish security for the due observance and performance of the stipulations contained therein. Such a stipulation also does not by itself show that the agreement was one of agency. ", "The present agreement undoubtedly contains some ele- ments of agency also, but the main question which has to be determined in this case is whether or not at the point of time when the appellant was consuming the Hispeedol or petrol for its own purposes it was acting as an owner of the goods or as agent of the seller Company. From the facts and circumstances discussed above,-we have shown that the appel- lant, after taking delivery of the goods, was the owner of the goods and if it consumed the same for its own purposes it was not doing so as agent but as owner which it was fully entitled to do. In this view of the matter, the quantities of petrol consumed by the appellant for its own purposes would not constitute a sale so as to be exigible to sales tax. We have carefully perused the order of the Commissioner and find that the Commissioner has taken an erroneous view of the law and has drawn legally wrong infer- ences from the various stipulations contained in the agree- ment. The Commissioner has also not given effect to well established legal principles in interpreting the agreement. For the reasons given above, we are unable to maintain the order of the Commissioner which suffers from manifest errors of law apparent on the face of the record. We, therefore, allow these appeals, set aside the order of the Commissioner dated May 5, 1970, and hold that the use of the Hispeedol and petrol by the appellant for its own purposes is not exigible to sales tax and the proceedings for impos- ing sales tax on the appellant are hereby quashed. The appellant will be entitled to its costs throughout. ", "P.B.R. Appeal allowed. ?593"], "relevant_candidates": ["0000129081", "0000311084", "0000534154", "0000568978", "0000812823", "0001739073", "0001988958"]} {"id": "0001055016", "text": ["PETITIONER: , ETC. Vs. RESPONDENT: STATE OF UTTAR PRADESH AND ORS. DATE OF JUDGMENT28/07/1995 BENCH: JEEVAN REDDY, B.P. (J) BENCH: JEEVAN REDDY, B.P. (J) SEN, S.C. (J) CITATION: 1995 SCC (5) 173 JT 1995 (5) 505 1995 SCALE (4)573 ACT: HEADNOTE: JUDGMENT: ", "J U D G M E N T B.P. JEEVAN REDDY.J. ", "These writ petitions highlight the faulty manner in which reservations have been provided and implemented by and its authorities in the matter of admission to medical courses for the year 1994-95. Though the dispute pertains to the academic year 1994-95, we are told that the admissions have been made only in June- July, 1995 and are yet to be finalised in respect of certain courses. ", "The story begins with the announcement of policy of reservation in the matter of admission to medical courses issued by the on May 17, 1994. According to this notification, sixty five percent of seats were reserved in favour of various classes/categories leaving only thirty five percent for open competition (O.C.) category. The reservations provided were to the following effect: ", "1. Backward Class 27% 2. Hill Region 3% 3. Uttarakhand Region 3% 4. Scheduled Caste 21% 5. Scheduled Tribe 2% ", "6. Real dependents of freedom fighters 5% ", "7. Son/daughter of soldier died in war/handicapped solders 2% ", "8. For Handicapped Candidates 2% ", "--------------------- ", "65% ", "--------------------- ", "A further reservation in favour of women was also provided to the extent of thirty percent in each of the above categories. The reservations so provided were challenged by way of a writ petition in this Court under Article 32 of the Constitution-Civil Writ Petition No.777 of 1994 ( .). The contention of the petitioner was that reservation of sixty five percent of seats was contrary to the decision of this Court in . (1992 Suppl. (3) S.C.C. 217) and, therefore, void. Pending the said writ petition, the Government issued a notification on December 17, 1994 modifying the reservation policy contained in the notification of May 17, 1994. It would be appropriate to set out the notification dated December 17, 1994 in its entirety: ", "No. 6550/Sec-14/V-111/93 From: , Sachiv, Uttar Pradesh Shasan To: Director General, Medical Education, Training, U.P.Lucknow Medical Section-14 Lucknow dated 17.12.94 Sub: Reservation in seats of M.B.B.S./B.D.S./B.H.M.S. /B.A.M.S./B.U.M.S. Courses to be filled through C.P.M.T. in State Allopathic Medical Colleges/K.G. ", ", Lucknow/All State Homeopathic/Ayurvedic/Unani s. ", "......... ", "Sir, In continuation of GONo 2697/Sec-14/V- 94/111/93 dated 17594, on the above subject, I am directed to say clarifying the policy that horizontal reservation be granted in all medical colleges on total seats of all the courses to be filled through combined Pre-Medical Test (CPMT) 1994 as given below: ", "1. Real dependents of freedom fighters 5% ", "2. Sons/daughters of deceased/disabled soldiers 2% ", "3. Physically handicapped candidates 2% ", "4. Candidates belonging to hill areas 3% ", "5. Candidates belong to Uttaranchal areas 3% ", "2. The above reservation would be horizontal and the candidates of the above categories, selected on the basis of merit, would be kept under the categories of Scheduled Castes/Scheduled Tribes/Other Backward Classes/ General to which they belong. For example, if a candidate dependent on a Freedom Fighter selected on the basis of reservation belongs to reserved for scheduled caste, (he will be adjusted against the seat reserved for S.C.?) Similarly, if a physically handicapped candidate selected on the basis of reservation belongs to other backward class or general category, he would be adjusted against the seats reserved for other backward classes or general category. ", "3. I am also directed to say that vertical reservation shall be granted in all medical colleges on total seats of all courses to be filled through C.P.M.T. 1994 as given below: ", "a) Scheduled Caste Candidates-21%} 30 seats ", "b) Scheduled Tribe Candidates-21%} in each ", "c) Other Backward Class } category candidates -27%} reserved } for ladies ", "4. 'Other Backward Classes' mean the classes mentioned in Annexure-1 of Notification No. 488/XVII-V-1-1(Ka) 8-1994 dated 23.3.94 notified by Vidhiyaka Anubhag, Uttar Pradesh Adhiniyam No.4/1994. The candidates of backward classes mentioned in Annexure-II of the aforesaid Adhiniyam would not be entitled for the reservation. ", "5. I am also directed to clarify that if a candidate of reserved category, mentioned in para 3 above, is selected alongwith general category candidates on the basis of merit, he shall not be adjusted against reserved seats, as G.O. in this regard has already been issued. So, 50% seats of general category shall be filled on the basis of merit prior to filling of reserve seats mentioned in para 3 above. ", "Please ensure strict compliance of these orders. ", "Yours faithfully, sd/- ", "\" ", "This revised notification was brought to the notice of this Court at the hearing of the aforesaid writ petition. After noticing both the aforesaid notifications this Court (the Bench comprising , J. and one of us, ,J.) observed as follows: ", "\"2. Reservation of 65% resulting in reducing the general category of 35% was undoubtedly violative of Article 16. Further by reserving 30% of the general seats for ladies the general category shrank to 5%. But these glaring infirmities have been rectified by the amended circular. Reservation of 30% for ladies has now been confined to para 3 of the amended circular. Dr. , learned Senior Counsel appearing for the clarified that he has instructions to make a statement on the amended circular that now there is no reservation for ladies in the general category. ", "3. Similarly, the other defect in the circular reserving 35% seats for general category has been removed. The vertical reservation is now 50% for general category and 50% for Scheduled Castes, Scheduled Tribes and Backward Classes. ", "Reservation of 15% for various categories mentioned in the earlier circular which reduced the general category to 35% due to vertical reservation has now been made horizontal in the amended circular extending it to all seats. The reservation is no more in general category. The amended circular divides all the seats in into two categories - one, general and other reserved. Both have been allocated 50%. Para 2 of the circular explains that candidates who are selected on merit and happen to be of the category mentioned in para 1 would be liable to be adjusted in general or reserved category depending on to which category they belong, such reservation is not contrary to what was said by this in . Whether the reservation for such persons should have been made or not was not challenged, therefore, this is not required to examine it. ", "4. In the result this petition is disposed of by directing that in view of the circular issued by the Government on 17-12-1994 clarified by para 2 the grievance of the petitioner cannot be said to have been survived. The interim order passed by this Court staying the declaration of results is discharged.\" This decision was rendered on February 2, 1995. On February 14, 1995 the Government issued a clarification stating: ", "\"I have been directed to say that partly modifying the G.O.No.6550-Sec.14- V/111/93 dt.17.12.94 on the above subject, clause para 3 of the said G.O. shall be read as under: ", "3. I am also directed to say that vertical reservations shall be granted in all Medical Colleges on total seats of all Courses to be filled through C.P.M.T. 1994. ", "i) Scheduled Caste Candidates 21% ", "ii) Scheduled Tribes Candidates 2% ", "iii) Other Backward Class Candidates 27% The effect of this clarification is that reservation in favour of women has been removed from all the reserved categories. ", " had issued a notification calling for applications for admissions to medical courses in the State in accordance with the notification of May 17, 1994. After the decision of this Court in and in the light of the revised notification by the , as also the clarification issued on February 14, 1995, the University issued a corrigendum stating that the reservation in favour of five categories, viz., (1) actual dependents of freedom fighters - 5%, (2) sons/daughters of soldiers/deceased/disabled in war - 2%, (3) physically handicapped - 2%, (4) candidates of hill area - 3%, and (5) candidates of Uttarakhand area - 3% (hereinafter referred to as in this judgment as \"Special Categories\") shall be horizontal reservations and not vertical reservations. The corrigendum stated: ", "\".....following Horizontal reservation has been provided on the total seats of all the courses of every Medical College to be filled on the basis of Combined Pre-Medical Test, 1994: ", "1) Actual dependents of freedom fighters 5% ", "2)Sons/daughters of Soldiers/deceased/disabled inwar 2% ", "3) Physically handicapped 2% ", "4) Candidates of Hill Area 3% ", "5) Candidates of Uttarakhand Area 3% ", "2. The above reservation will be horizontal and the candidates of above categories, selected on the basis of merit, would be kept under the categories of Schedule Caste/Schedule Tribe/Other Backward Class/General to which they belong. ", "3. It is also informed that on total number of seats of every course in every Medical College through C.P.M.T. 1994. The following vertical reservations have been provided: ", "(1) Scheduled Caste Candidates 21% (2) Scheduled Tribe Candidates 2% (3) Other Backward Class Candidates 27% 4. It is also clarified that if any candidate belonging to Schedule Caste/Schedule Tribe/Other Backward Class categories is selected in open ", "competition on the basis of merit, then he will not be adjusted in the seats reserved for concerned categories. Therefore after filling the seats on the basis of horizontal reservation, the unreaserved seats will be filled on the basis of merits and thereafter reserved seats for Schedule Caste/schedule tribe/Other Backward Class will be filled. ", "5. As per above mentioned provisions the provisions for reservations in application form and important guidlines for C.P.M.T.1994 issued earlier will deemed to be modified accordingly. ", "6. Therefore, it is desired from the candidates falling under horizontal reservations that if they belong to Scheduled Caste, Scheduled Tribe or Other Backward Class Category, then they should send Caste Certificate on the following proforma giving his Roll number and examination details to the Registrar, by 28.2.95. If Caste Certificate is not receivedwithin the prescribed period, then it will be deemed that concerned candidates belongs to the General Category. Once a Caste Certificate is furnished same cannot be changed subsequently. The prescribed proforma of Caste Certificate is being sent to the concerned candidates falling under Horizontal reservation through UPC for necessary action as aforesaid. In case proforma of Caste Certificate is not received by post, then same can be obtained by contacting Registrar, .\" ", "In accordance with the procedure aforesaid, admissions have been made which are questioned in the present two writ petitions. ", "At the outset, we may mention a glaring illegality which has unfortunately not been raised in these writ petitions but is self-evident from the decisions of this Court. Under the revised notification dated December 17, 1994, three percent of the seats have been reserved for candidates belonging to hill areas and another three percent in favour of candidates belonging to Uttaranchal areas. These two reservations along with the reservations in favour of physically handicapped, children of deceased/disabled soldiers and dependents of freedom fighters are treated as horizontal reservations. In other words, the reservations in favour of hill areas and Uttaranchal areas are understood and treated as reservations relatable to Article 15(1) of the Constitution and not as reservations in favour of \"socially and educationally backward classes of citizens or for the Scheduled Castes and Scheduled Tribes\" within the meaning of Article 15(4) of the Constitution. It has been held by this Court in (1975 (1) S.C.C.267) that the reservation of seats in favour of candidates belonging to hill areas and Uttarakhand areas are reservations within the meaning of Article 15(4) of the Constitution, i.e., they are reservations in favour of socially and educationally backward classes of citizens. This Court found that \"the has established that the people in hill and Uttarakhand areas are socially and educationally backward classes of citizens\". It, therefore, follows that a separate horizontal reservation of six percent of the seats in favour of candidates from hill areas and Uttaranchal apart from and in addition to twenty seven percent reservation in favour of other backward class candidates is clearly illegal. Though this contention has not been specifically raised in these writ petitions we must yet take notice of this circumstance while making the appropriate directions in these matters. It isindeed surprising that the of Uttar Pradesh which is a party to the above decision has failed to bear it in mind. The said decision has also been referred to approvingly in . The of Uttar Pradesh shall keep this in mind for future selections as also in respect of those which may be now under way and make necessary corrections. ", "We may now turn to the contentions raised in the writ petition. ", "In the initial notification calling for applications, the fifteen percent special reservations were treated as vertical reservations along with reservations in favour of Other Backward Classes, Scheduled Castes and Scheduled Tribes. Applications were accordingly received. But with the issuance of the revised notification of December 17, 1994, the decision of this Court in and the clarification contained in the letter dated February 14, 1995, these special reservations became horizontal reservations. Accordingly, a corrigendum was issued by calling upon the candidates belonging to these special categories to specify to which social reservation category they belong. In other words, the candidates who had applied under any of the said special reservations were asked to specify whether they belong to Scheduled Tribes, Scheduled Castes, Other Backward Classes or to open competition category, as the case may be. It is stated that the candidates did indicate the same. According to the counter-affidavit now filed on behalf of the respondents, it appears that out of 2130 candidates who had applied against the five special reservation categories only nine stated that they belong to Other Backward Classes. None stated that they belong to Scheduled Tribes or Scheduled Castes which meant that but for nine candidates, all the rest applying under the aforesaid special categories were from the general/non-reserved category. As we shall indicate presently, 110 out of 112 special reservation candidates have been accommodated only in O.C. category and none in the O.B.C., S.C. or S.T. category. ", "Now, coming to the manner in which the said two-way reservations, viz., social reservations (vertical reservations) and special reservations (horizontal reservations) have been implemented, a few facts may be noticed. In the Counter-affidavit filed by the respondent (sworn-to by Sri ) it is stated that the total number of seats available in M.B.B.S, course in the government colleges in Uttar Pradesh is 746. Fifteen percent of the said number comes to 112 seats. In Para 16, it is stated: ", "\"16. That in C.P.M.T. 1994 out of this 112 seats 101 students were selected and all of them belong to the General Category. The replying respondent filled up unreserved seats first and while doing so, 101 students selected on the basis of horizontal reservation since they belong to General Category, hence they have to be adjusted against unreserved seats. 9 belonging to Other Backward ClassesCategory has secured equivalent marks as General Candidates and thus were selected on merits. These candidates have been adjusted against unreserved category. The Roll number, names and total marks out of 1200 of these candidates are as follows: ", "1. 33936 S/o J.P.Gupta 974/1200 ", "2. 16678 s/o B.S. Yadava 971/1200 ", "3. 28415 S/o S.C.S. Yadava 957/1200 ", "4. 10506 S/o O.P.Yadava 950/1200 ", "5. 60497 947/1200 ", "6. 47946 Vishal Singh S/o Y. Singh 947/1200 ", "7. 47684 S/o V.S. Yadava 1003/1200 ", "8. 15633 S/o S.K. Yadava 954/1200 ", "9. 57620 944/1200 The remaining 263 seats were filled through General Candidates and last candidate selected has secured 891 marks out of 1200 marks. 201 candidates of Other Backward Classes were selected against reserved seats 157 against seats reserved for Scheduled Castes and 15 against seats reserved for Schedule Tribe. Similarly same procedure was applied in all the categories. Therefore, the contention of the petitioner that only 36% seats are filled with General Candidates is wrong. A photostat copy of tabulated result is being filed herewith and marked as Annexure R-IV to to this affidavit.\" ", "A reading of Para 16 makes it clear that the authorities in-charge of making admissions first took up the special category reservations and filled them up. Of the 112 candidates, 101 were from what may be called for the sake of convenience, `unreserved category' while nine candidates belonged to Other Backward Class category. But it appears that inasmuch as the said nine candidates belonging to Other Backward Classes had secured equal marks with the general candidates and were accordingly selected on merit in the O.C. quota, they were treated as Open competition candidates. The result was that out of 112 seats reserved for special categories, 110 seats were taken away from the Open competition (O.C.) category, thus leaving only 263 seats for the general candidates, i.e., O.C. candidates not belonging to any of the special reservations. It is the above method of filling of seats that has been challenged in these writ petitions. ", "The contention of the learned counsel for the petitioners is two fold: (i) by virtue of the revised notification of December 17, 1994, the decision of this Court in and the corrigendum notification issued by , it is clear that the special reservation seats are to be distributed and allocated proportionately among the social, i.e., vertical reservation categories. Had it been so done, only fifty six candidates belonging to special reservation categories could be accommodated in the O.C. category. But, the respondents have accommodated 110 special reservation candidates in the O.C. category, an excess of fifty four seats. These fifty four seats must be taken away from the special reservation categories and allotted to O.C. candidates not belonging to any special reservation category. (ii) The procedure prescribed in the aforesaid revised notification for filling up the vacancies is equally illegal which has also resulted in the dimunition of seats available for O.C. category. The admissions should be re-done thoroughly to rectify the said error. ", "On the other hand, the learned counsel for the respondents justify the procedure prescribed in the revised notification for making the admissions. With respect to the first contention of the learned counsel for the petitioners, the submission of the learned counsel for and the State of Uttar Pradesh is that the fifteen percent reservation in favour of special categories (special reservation) is an overall reservation and not a compartmentalised reservation. They submit that these special reservations are not divided proportionately among the vertical (social) reservation categories and, therefore, these special reservation candidates have to be provided fifteen percent of the total seats (i.e., 112 seats) overall, whether by adjusting them against any of the social/vertical reservations or otherwise. ", "The question is which of the above interpretations is the correct one having regard to the language employed in the concerned notifications? ", "On a careful consideration of the revised notification of December 17, 1994 and the aforementioned corrigendum issued by , we are of the opinion that in view of the ambiguous language employed therein, it is not possible to give a definite answer to the question whether the horizontal reservations are overall reservations or compartmentalised reservations. We may explain these two expressions. Where the seats reserved for horizontal reservations are proportionately divided among the vertical (social) reservations and are not inter-transferable, it would be a case of compartmentalised reservations. We may illustrate what we say: Take this very case; out of the total 746 seats, 112 seats (representing fifteen percent) should be filled by special reservation candidates; at the same time, the social reservation in favour of Other Backward Classes is 27% which means 201 seats for O.B.Cs.; if the 112 special reservation seats are also divided proportionately as between O.C.,O.B.C.,S.C. and S.T., 30 seats would be allocated to the O.B.C. category; in other words, thirty special category students can be accommodated in the O.B.C. category; but say only ten special reservation candidates belonging to O.B.C. are available, then these ten candidates will, of course, be allocated among O.B.C. quota but the remaining twenty seats cannot be transferred to O.C. category (they will be available for O.B.C. candidates only) or for that matter, to any other category; this would be so whether requisite number of special reservation candidates (56 out of 373) are available in O.C. category or not; the special reservation would be a water tight compartment in each of the vertical reservation classes (O.C.,O.B.C.,S.C. and S.T.). As against this, what happens in the over-all reservation is that while allocating the special reservation students to their respective social reservation category, the over-all reservation in favour of special reservation categories has yet to be honoured. This means that in the above illustration, the twenty remaining seats would be transferred to O.C. category which means that the number of special reservation candidates in O.C. category would be 56+20=76. Further, if no special reservation candidate belonging to S.C. and S.T. is available then the proportionate number of seats meant for special reservation candidates in S.C. and S.T. also get transferred to O.C. category. The result would be that 102 special reservation candidates have to be accommodated in the O.C. category to complete their quota of 112. The converse may also happen, which will prejudice the candidates in the reserved categories. It is, of course, obvious that the inter se quota between O.C., O.B.C., S.C. and S.T. will not be altered. ", "Now coming to the revised notification of December 17, 1994, it says that \"horizontal reservation be granted in all medical colleges on total seats of all the courses....\". These words are being interpreted in two different ways by the parties; one says it is over-all reservation while other says it is compartmentalised. Paragraph 2 says that the candidates selected under the aforesaid special categories \"would be kept under the categories of Scheduled Castes/Scheduled Tribes/Other Backward Classes/General to which they belong. For example, if a candidate dependent on a freedom fighter selected on the basis of reservation belongs to Scheduled Castes, he will be adjusted against the seat reserved for Scheduled Castes\". This is sought to be read by the petitioners as affirming that it is a case of compartmentalised reservation. May be or may not be. It appears that while issuing the said notification, the Government was not conscious of the distinction between overall horizontal reservation and compartmentalised horizontal reservation. At any rate, it may not have had in its contemplation the situation like the one which has arisen now. This is probably the reason that this aspect has not been stated in clear terms. ", "It would have been better - and the respondents may note this for their future guidance - that while providing horizontal reservations, they should specify whether the horizontal reservation is a compartmental one or an overall one. As a matter of fact, it may not be totally correct to presume that was not aware of this distinction between \"overall horizontal reservation\", since it appears from the judgment in that in the first notification issued by on May 17, 1994, the thirty percent reservation for ladies was split up into each of the other reservations. For example, it was stated against backward classes that the percentage of reservation in their favour was twenty seven percent but at the same time it was stated that thirty percent of those seats were reserved for ladies. Against every vertical reservation, a similar provision was made, which meant that the said horizontal reservation in favour of ladies was to be a \"compartmentalised horizontal reservation\". We are of the opinion that in the interest of avoiding any complications and intractable problems, it would be better that in future the horizontal reservations are comparmentalised in the sense explained above. In other words, the notification inviting applications should itself state not only the percentage of horizontal reservation(s) but should also specify the number of seats reserved for them in each of the social reservation categories, viz., S.T., S.C., and O.C. If this is not done there is always a possibility of one or the other vertical reservation category suffering prejudice as has happened in this case. As pointed out hereinabove, 110 seats out of 112 seats meant for special reservations have been taken away from the O.C. category alone - and none from the or for that matter, from S.C. or S.T. It can well happen the other way also in a given year. ", "Now, coming to the correctness of the procedure prescribed by the revised notification for filling up the seats, it was wrong to direct the fifteen percent special reservation seats to be filled up first and then take up the O.C. (merit) quota (followed by filling of O.B.C., S.C. and S.T. quotas). The proper and correct course is to first fill up the O.C. quota (50%) on the basis of merit: then fill up each of the social reservation quotas, i.e., S.C., S.T. and B.C; the third step would be to find out how many candidates belonging to special reservations have been selected on the above basis. If the quota fixed for horizontal reservations is already satisfied - in case it is an over-all horizontal reservation - no further question arises. But if it is not so satisfied, the requisite number of special rreservation candidates shall have to be taken and adjusted/accommodated against their respective social reservation categories by deleting the corresponding number of candidates therefrom. (If, however, it is a case of compartmentalised horizontal reservation, then the process of verification and adjustment/accommodation as stated above should be applied separately to each of the vertical reservations. In such a case, the reservation of fifteen percent in favour of special categories, overall, may be satisfied or may not be satisfied.) Because the revised notification provided for a different method of filling the seats, it has contributed partly to the unfortunate situation where the entire special reservation quota has been allocated and adjusted almost exclusively against the O.C. quota. ", "In this connection, we must reiterate what this Court has said in . While holding that what may be called \"horizontal reservation\" can be provided under clause (1) of Article 16 , the majority judgment administered the following caution in para 744: \"(B)ut at the same time, one thing is clear. It is in very exceptional situation - and not for all and sundry reasons - that any further reservations of whatever kind, should be provided under clause (1). In such cases, the has to satisfy, if called upon, that making such a provision was necessary (in public interest) to redress the specific situation. The very presence of clause (4) should act as a damper upon the propensity to create further classes deserving special treatment. The reason for saying so is very simply. If reservations are made both under clause (4) as well as under (1), the vacancies available for free competition as well as reserved categories would be correspondingly whittled down and that is not a reasonable thing to do\". Though the said observations were made with reference to clauses (1) and (4) of Article 16 , the same apply with equal force to clauses (1) and (4) of Article 15 as well. In this case, the reservation of fifteen percent of seats for special categories was on very high side. As pointed out above, two categories out of them representing six percent out of fifteen percent are really reservations under Article 15(4 ), wrongly treated as reservations under Article 15(1). Even otherwise, the special reservation would be nine percent. The respondents would be well advised to keep in mind the admonition administered by this Court and ensure that the special reservations (horizontal reservations) are kept at the minimum. ", "Having pointed out the errors in the rule of reservation and its implementation, the question arises what should be done now? Should we interfere with the admissions already finalised? We think it inadvisable to do so. It may be remembered that the admissions now finalised (in June- July, 1995) are really the admissions which ought to have been finalised one year back. The delay has occured on account of the first faulty notification (issued on May 17, 1994). When a writ petition was filed in this court - probably some writ petitions in also - the Government realised its mistake and issued the revised notification on December 17, 1994. It dropped the reservation in favour of women in stages. The had then to issue a corrigendum asking the special category candidates to indicate their social status. This was a delayed exercise which ought to have been undertaken at the beginning itself. Even the manner in which the seats have been filled up, as indicated above, is faulty. What we have laid down herein is more for the purpose of future guidance for the respondents. At the same time, we have to rectify the injustice done to the open competition candidates in the admissions in question, to the extend feasible. Accordingly, we direct that in the matter of admissions made pursuant to C.P.M.T.1994, while the admissions already finalised shall not be disturbed, shall create thirty four additional seats in the M.B.B.S. couse and admit thirty four students from the O.C. category against those seats. If any seats are vacant as on today, they shall also be filled from the O.C. category alone. (It is made clear that O.C. category means the merit list and no distinction shall be made among the candidates in the O.C. list on the basis of their social status because it is well settled that even a S.T./S.C./O.B.C. candidate is entitled to obtain a seat in the O.C. category on the basis of his merit.) The counsel for the petitioners complain that fifty four students belonging to O.C. category have been deprived on account of respondents' faulty actions and that it should be directed to be made up. We cannot agree. The factual basis of this submission is debatable in view of the ambiguity mentioned hereinbefore. We have directed creation of thirty four seats (making a total of 780 seats this year) having regard to all the facts and circumstances of the case. This creation of additional seats is restricted to current admissions only and shall not be a permanent feature. The Uttar Pradesh Government/concerned authorities shall allocate the said thirty four additional seats appropriately among the government medical colleges and make admissions thereto as early as possible. ", "We hope and trust that the respondents will ensure that a similar situation does not arise for the ensuing admissions. ", "The writ petitions are disposed of with the above terms. No costs. ", "A copy of this judgment shall be communicated to the Chief Secretary, and the Secretary, , eo nomine (i.e., by their designation) for their attention and implementation."], "relevant_candidates": ["0000861069", "0001105516", "0001734464"]} {"id": "0001063842", "text": ["PETITIONER: PREM Vs. RESPONDENT: SURENDER GANDOTRA AND ORS. DATE OF JUDGMENT27/08/1991 BENCH: , JAGDISH SARAN (J) BENCH: , JAGDISH SARAN (J) SHARMA, L.M. (J) CITATION: 1991 AIR 2254 1991 SCR (3) 782 1991 SCC Supl. (2) 215 JT 1991 (3) 570 1991 SCALE (2)459 ACT: Delhi Co-Operative Societies Act , 1972. Sections 59 and 60-Dispute relating to irregularities in purchase of build- ing materials by the past --Whether falls within the ambit of Section 60 . HEADNOTE: On a complaint made by the of the 6th respondent , the third respond- ent, Registrar, , referred the dispute relating to irregularities in the purchase of building material for construction of flats for members of society by the past , of which the appellant was the President at the relevant time, to arbitration. The first respondent-Arbitrator, gave his ex-parte award, on the failure of the appellant and another person to file their reply to the claim of the claimant society, and directed the appellant and the other person to pay the society certain sum with interest thereon. The appellant challenged the award before second re- spondent, , which dismissed the same holding that the Arbitrator's act of proceeding ex-parte was justified and that the appeal had no merit. The appellant's writ petition was also dismissed by . In the appeal before this Court on behalf of the appel- lant it was contended that it was Sec. 59 dealing with surchage which was applicable to the instant case and not Section 60 , which pertained to settlement of disputes by arbitration since the dispute in question was one which could not be referred to arbitration in terms of Section 60 of the Act. On behalf of the contesting respondents it was submitted that it was Section 60 , which was applicable and not Section 59 . Dismissing the appeal, this Court, HELD: 1.1 Sub-Section (1) of Section 60 of the Delhi Co- operative 783 Societies Act , 1972 indicates the true scope of the Section 60 , while sub-section (2) is merely illustrative, and not exhaustive. Clause (c) of sub-section (1) expressly provides that if any dispute touching the constitution/management or the business of the cooperative society arises between the society or its committee and any past committee. any offi- cer, agent or employee or any past officer of the society, the dispute should be referred to the arbitration. [787H, 788A-B, D] 1.2 In the instant case, the dispute, viz. irregulari- ties in the purchase of building material for construction of flats for the members of the by the previous , touches the management of the and fails within the ambit of Section 60 of the Act. The third respondent, Registrar, was, therefore, right in referring the dispute to arbitration. [789D- .. 1 SCR 186, followed. , AIR 1976 63 Delhi 239, disapproved. JUDGMENT: ", "CIVIL APPELLATE JURISDICTION: Civil Appeal No. 3237 of 1991. ", "From the Judgment and Order dated 10.10.1990 of in C.W. No. 3204 of 1990. ", ", and , Advs. for the Appellant. ", "Dr. , and for the Respondents. The Judgment of the Court was delivered by , is granted. ", "Respondent No. 6, , was formed in 1979 for providing houses to its 130 members including the appel . The appel was earlier the Secretary and then the President of the till 1985, by which time substantial con- struction had been completed. The members were allotted three-room flat for a sum of Rs. 1, 10,000. In August, 1985, Respondent No. 3, Registrar, , appointed an Administrator to look into the affairs of the since the appel. and other office bearers had held the office for more than two terms. The controversy giving rise to this proceeding relates to the alleged discrepancy re- garding purchase of some building material in January, 1984, for the construction of flats for members of the in Vikas Puri at New Delhi. of the formed in September, 1986, complained to alleging irregularities by the previous Managing Committee of which the appel was the President. This matter was referred to arbitration by order dated 12.10.1989 passed by , . Respondent No, 1, was appointed the Arbitrator, who gave his AWard on 1.5. 1990. The relevant portion of the Award is as under: ", "\"It is also interesting to discuss the conduct of these two respondents of this case, and as they have been moving applications after applications in this court raising vicious and frivolous grounds just to delay the delivery of justice in this case. The miscellaneous applications relating to the dispute of juris- diction of this court and then that since criminal proceedings are pending with , proceedings in this Court should be kept pending till final decision in the criminal proceedings. All these applications were properly attended, scrutinized and dis- posed of legally. It is also interesting that despite number of chances/opportunities having been given to the respondent to file reply to the main points of the claimant society, the defendants S/ and did not file any reply and followed delaying and dilatory tactics and to defeat the ends of justice. Even today 30th April, 1990, fixed for hearing none came from the side of S/Shir Poonam Dhand, either presonally or through Advocate. The advocate of the claimant society argued that ex parte proceedings may be initiated against the respondents who have absented from these proceedings. In view of these cricumstances, and the conduct of 'respondents in this case 0right from the very inception of this case, there is no other alternative left for me but to proceed ex parte against the respondents S/ and . ", "Ex parte award is announced with the following details; . ", "785 ", "Principal amount to be paid by the respon- ", "dents to , Vikas Puri, New Delhi. Rs-1,46,2 10.20 Interest at the rate of 18% from 17.4.1985 till all the dues are cleared by the respond- ", "ents. ", "Cost allowed Rs.5,000.00 ", "With the above observations, ex parte award is given against the respondents S/Shri Poonam Dhand, P.3, who are jointly and severally responsible to pay , Vikas Puri, New Delhi, principal amount of Rs. 1,46,210.00 NPS plus 18% interest from 17.4.1985 till all the dues are cleared and costs of Rs.5,000.\" , The appellant then filed an appeal under section 76 of the Delhi Cooperative Societies Act, 1972 (hereinafter referred to as 'the Delhi Act ') in (Respondent No. 2) challenging the Award dated 1.5.1990. The held that the Arbitrator's act of proceeding ex parte against the appellant is justified and taking the view that the appeal had no merit, dismissed the same. The appellant then filed a writ petition in challenging the Award and dismissal of his appeal by the on 3.7.1990. The said writ petition has been dismissed by on 10.10.1990. It is in these circumstances that the appellant assails the Award, dismiss- al of the appeal and then the .writ petition. The argument of , learned counsel for the appellant, is that it is section 59 and not section 60 of the Delhi Act which applies to the present case. In reply, Dr. on behalf of the contesting respondents contended that section 60 relating to arbitration and not section 59 pertaining to surcharge applies to the present case. Sections59 and 60 of the Delhi Act , insofar as relevant, are quoted hereinbelow:- ", "\"59. Surcharge-(1) If in the course of an audit, inquiry, inspection or the wind- ing up of a cooperative society, it is found that any person, who is or was entrusted with the organisation or management of such society or who is or has at any time been an officer or an employee of the society, has made any payment contrary to this Act, the rules or the bye-laWs or has caused any deficiency in the assets of the society by breach of trust or wilful negligence or has misappropriated or fraudulently retained any money or other property belonging to such society, the Registrar may, of his own motion or on the application of the committee, liquidator or any creditor, inquire himself or direct any person authorised by him, by an order in writing in this behalf, to inquire'into the conduct of such person; ", "Provided that no such inquiry shall be held after the expiry of six years from the date of any act or omission referred to in this sub-section. ", "(2) Where an inquiry is made under sub-section (1), the Registrar may, after giving the person concerned an opportunity of being heard, make an order, requiring him to repay or restore the money or property or any part thereof, with interest at such rate, or to pay contribution and costs or compensation to such extent, as the Registrar may consider just and equitable.\" ", "\"60. Disputes which may be referred to arbitration(1) Notwithstanding anything contained in any law for the time being in force, if any dispute touching the constitu- tion, management or the business of a coopera- tive society other than a dispute regarding disciplinary action taken by the society or its committee against a paid employee of the society arises-- ", "(a) among members, past members and persons claiming through members, past members and deceased members, or ", "(b) between a member, past member or person claiming through a member, past member or deceased member and the , its com- mittee or any officer, agent or employee of the or liquidator, past or present, or ", "(c) between the society or its commit- tee and any past committee, any officer, agent or employee, or any past officer, past agent or past employee or the nominee, heirs or legal representatives of any deceased officer, deceased agent, or deceased employee of the society, or ", "(d) between the society and any other cooperative society, between a society and liquidator of another society or between the liquidator of another society. such disputes shall be referred to for decisior and no court shall have jurisdiction to entertain any suit other proceedings in re- spect of such dispute.. ", "(2) For the purposes of sub-section (1), the following shall be deemed to be disputed touching the constitution management or the business of a cooperative society namely-- ", "(a) a claim by the for any debt or demand due to it from a member or the nominee, heirs or legal rep resentatives of a deceased member, whether such debt of demand is admitted or not; ", "(b) a claim by a surety against the principal debtor where the society has recov- ered from the surety any amount in respect of any debt or demand due to it from the princi- pal debtor as a result Of the default of the principal debtor, whether such debt or demand is admitted or not; ", "(c) any dispute arising in connection with the elec tion of any officer of a society other than a society mentioned in sub-section (1) of section 31 . ", "(3) If any question arises whether a dispute referred to the r under this section is or is not a dispute touching the consitution, management or the business of cooperative society, the decision thereon of the shall be final and shall not be called in question in an court. ", "i (4) .................\" ", "In substance the contention of the learned counsel for the appeal lant is that the proper action to take in such a case is to resort to section 59 dealing with surcharge and not to settlement of dispute by arbitration since it is not one of the disputes which may be referred to arbitration in terms of section 60 of the Delhi Act. It was argued that sub-section (2) of section 60 is exhaustive and not merely illustrative, which shows that the present dispute does not fall within the ambit 0 section 60 . Dr. , on the other hand, asserted that it is sub section (1) of section 60 which indicates the true scope of section 60 while sub-section (2) is merely illustrative and no exhaustive. It was urged that clause (c) of sub-section (1) of section 60 expressly provides that if any dispute touching the constitution,' management or the business of the cooperative society arises between the society or its committee and any past committee, any officer, agent or employee or any past officer of the society, the dispute shall be refered to arbitration. ", "Reliance is placed on behalf of the appellant on . 1. R. 1976 63 Delhi 299 wherein the learned Single Judge took the view that sub-section (2) of section 60 of the Delhi Act is exhaustive and not merely illustra- tive. That decision overlooks the decision of this in Srirakulu referred hereafter and conflicts with it. Further consideration of the same is, therefore, not necessary. Dr. placed reliance in ., 1 SCR 186 to contend that this point was concluded against the appellant. In our opinion, the contention of Dr. has to be accepted. The decision of this in Srirakulu was ren- dered 'with reference to the Madras Cooperative Societies Act , 1932 (hereinafter referred to as 'the Madras Act') wherein section 51 relating to settlement of disputes by arbitration was the provision corresponding to section 60 of the Delhi Act-Clause (c) of sub-section (L) of section 51 of the Madras Act was substantially the same as clause (c) of sub-section (1)of section 60 of the Delhi Act. The explana- tion in sub-section (1) of section 51 of the Madras Act was substantially similar to clause (a)of sub-section (2) of section 60 of the Delhi Act. The material part of section 51 of the Madras Act, on the basis of which the decision was endered in Srirakulu quoted therein is as under-- ", "\" S. 51- ", "Arbitration: ", "Disputes: 51. (1) If any dispute touching the business of a registered society (other than a dispute regarding disciplinary action taken by the society or its committee against a paid servant of the society) arises- ", "(a) ....................................... ", "(b) .................................... ", " ", "(c) between the or its com- mittee and any past committee, any officer, agent or servant, or any past officer, past agent or past servant, or the nominee, heirs or legal representatives of any deceased officer, deceased agent or deceased servant, of the , or ", "(d) ............................... Explanation--A claim by a registered society for any debt or demand due to it from a member, past member or the nominee, heir or legal representative of a deceased member, whether such debt or demand be admitted or not, is a dispute touching the business of the society within the meaning of this sub-sec- tion.\" ", "In the Madras Act, section 49 was the provision correspond- ing to section 59 of the Delhi Act. It was, therefore, on the basis of similar corresponding provisions that the question arose for decision of this Court in . In also the facts disclosed in the inquiry that certain loss was caused to the society by the acts of past Managing Committee and, therefore, a special officer ap- pointed to look into the affairs of the society made a claim under section 51 of the Madras Act before the Registrar against the past President of the Society: It was held that the Registrar's order under section 51 of the Madras Act could not be challenged. We do not find any significant difference between the provisions of the Madras Act which form the basis .of this Court's decision in and sections 59 and 60 of the Delhi Act with which we are con- cerned to justify taking a different view as suggested by learned. counsel for the appellant. Following the view taken in , this appeal must fail. Consequently, the appeal is dismissed with costs quantified at Rs.5,000. ", "N.P.V. Appeal dis- missed."], "relevant_candidates": ["0000971550", "0001775026"]} {"id": "0001066060", "text": ["PETITIONER: B. PRABHAKAR RAO & ORS. ETC. Vs. RESPONDENT: STATE OF ANDHRA PRADESH & ORS. ETC.ETC. DATE OF JUDGMENT19/08/1985 BENCH: , O. CHINNAPPA (J) BENCH: , O. CHINNAPPA (J) ERADI, V. BALAKRISHNA (J) KHALID, V. (J) CITATION: 1986 AIR 210 1985 SCR Supl. (2) 573 1985 SCC Supl. 432 1985 SCALE (2)256 CITATOR INFO : R 1989 SC 903 (24) R 1992 SC 320 (85) RF 1992 SC 767 (8) RF 1992 SC1277 (42) ACT: Andhra Pradesh Public Employment (Regulation of Age of Superannuation) Act 1984 section 3(1) and Explanation II (a`). Fundamental Rules Rule 56 (a) and Hyderabad Civil Service Rules Rule 231. HEADNOTE: Employees - Age of superannuation - Change of - Amendments effected by Ordinance No. 24 of 1984 and section 4 (1) of Act 3 of 1985 - Whether constitutionally valid - Fixation of date and division of employees into two class on basis thereof - Whether permissible - Whether amenable to judicial scrutiny - Age Of Superannuation - Change of policy or reversal of policy. Constitution of India 1950, Article 14 Classification - Reasonableness of - Burden of proof on . Interpretation of Statutes department administering Act - Official statement of - Whether relevant for interpretation legislation to remedy wrongs - Wronged persons - Whether can be excluded. Practice & Procedure Writ petition - Dismissal in limini - Whether bar to entertainment of another similar writ petition. In the of Andhra Pradesh the age of superannuation was 55 years to begin with, but in the year 1979, the raised the age to 58 years. In February 1983, the decided to reduce the age of superannuation of its employees from 58 to 55 years, and also issued directives to local authorities and public corporations under its control to do likewise. 574 In order to give effect to the aforesaid policy of reversal, the amended Rule 56(a) of the Fundamental Rules and Rule 231 of the Hyderabad Civil Services Rules by substituting the figure '55' for the figure '58' and by making a special provision that those who had already attained the age of 55 years and were continuing in service beyond that age on 28.2.1983 shall retire from service on the afternoon of 28.2.1983. This was followed by another notification dated 17.2.1983 deleting the proviso to Rule 2 of the Fundamental Rules which protected a civil servant against a change in conditions of service to his detriment after he entered service. The Andhra Pradesh Ordinance No. 5 of 1983 was promulgated regulating the recruitment and conditions of service of persons appointed to public service and posts in connection with the affairs of the of Andhra Pradesh and the Officers and servants of Clause 10 of the Ordinance provided that every employee, not being a workman and not belonging to Last Grade Service shall retire from service on the afternoon of the last day of the month in which he attains the age of fifty-five years. In the case of employees belonging to , it was provided that they shall retire from service on the afternoon of the last day of the month in which they attain the age of sixty years. Clause 18(1) provided that the proviso to Rule 2 of the Fundamental Rules shall be deemed always to have been omitted. Immediately after the notification reducing the age of superannuation from 58 to 55 were issued, a large number of employees, employees of public sector corporations, and teachers working under various authorities filed writ petitions in this as well as in challenging the vires of the provisions reducing the age of superannuation. There was also a wide agitation by affected employees and on August 3, 1983 an Agreement was arrived at between the and . Clause (1) of the agreement provided that proviso to F.R. 2 will be restored in respect of all matters, except the age of superannuation retrospectively and that the provisions of the Ordinance relating to the age of superannuation will also be removed after the judgment of . The Agreement, also, contained a stipulation that it was not to be placed before either by the or by the employees. 575 enacted the Andhra Pradesh Public Employment (Regulation of age of Superannuation) Act No 23 of 1984 making it applicable to persons appointed to public service and posts and other employees in any , etc. On August 23, 1984 the Act was amended by- the promulgation of the Andhra Pradesh Ordinance No. 24 of 1984 providing that in s. 3(1) of the Act and in Explanation II (a) the words 'fifty-eight years' shall be substituted for the words 'fifty-five years'. The Andhra Pradesh Ordinance No, 24 of 1984 was replaced by Act No. 3 of 1985. By sec. 2 of the Amending Act , the words 'Fifty-five years' were substituted by the words 'fifty-eight years' in Sec. 3(1) and Explanation II(a) of the Principal Act. Section 4 of the Amending Act, which replaced Clause 3(1) of Ordinance No. 24 of 1984 provided : that: \"4(1) The provisions of section 2 of the Act shall not apply to persons who attained the age of superannuation pursuance of the notifications issued....... or in pursuance of the provisions of the Andhra Pradesh Public Employment (Regulation of Age of Superannuation) Act 1984.... ....\" During the pendency of the Writ Petitions in this , several employees of local authorities etc. Obtained orders of stay from and were continuing in service on the E date when the judgment of was pronounced. After the pronouncement of the judgment of , the authorities sought to give effect to the provisions of the Act and the Ordinance by seeking to throw out the employees on the ground that they had completed 55 years of age during the interregnum between February 28, 1983 and August 23, 1984. Some others who had completed 55 years between February 28, 1983 and August 23, 1984 but who had not completed 58 years sought re-entry, notwithstanding the raising of the age of superannuation from 55 years to 58 years. Their re- entry was sought to be resisted on the basis of cl. 3(1) of the Ordinance and s. 4(1) of the Amending Act. Those employees who were sought to be removed from service or who were denied re-entry into service On the ground that they had attained the age of 55 years between February 28, 1983 and August 23, 1984 once again invoked the jurisdiction of this under Article 32 and sought appropriate writs to continue or to reinstate and continue them in service until they attain the age of 58 Years. 576 On 23.4.1985, of this , directed that those servants who were in service prior to April 1, 1985 and who were removed from service on account of reduction in age, shall be reinducted in service, if the posts from which each one was removed was still vacant or someone was holding a temporary change. On May 6/7, 1985 another Bench of this directed that the aforesaid Order dated 23rd April, 1985 should be implemented to the extent that the posts from which the employees were removed are still vacant or where such post was held temporarily by others on promotion under Rule 37 of the A.P. s Subordinate Service Rules. Many persons claiming to have been appointed under Rule 10 or claiming to have been promoted regularly notwithstanding the mention of Rule 37, filed writ petitions questioning the orders of reversion with which they were faced consequent on the aforesaid interim directions of the . On behalf of the employees who had attained the age of 55 years between 28.2.1983 and 23.8.1984 lt was contended that the classification of these persons as a separate group for the purpose of excluding them from the benefit of the redressal of the wrong tone to the and the relief given to them by the amending Ordinance and the Act, was an unreasonable classification having no nexus whatever with the object of the legislation. It was urged that every person who was in employment on 28.2.1983 was hit by the reduction of the age of superannuation from 58 to 55 years and when it was realised that a grievous wrong hat been tone which it was necessary to set right by reversing the policy and such a policy decision having been taken, there was no reason to postpone effect being given to the reversal of policy to an uncertain date, namely the pronouncement of the Judgment by and thereby excluding from the benefits of the change of policy, that group of persons who hat the misfortune of attaining the age of 55 years. It was further contended that several persons who were continuing in service by virtue of stay orders obtained from , were also sought to be sent away by the on the ground that hat they not obtained the orders of stay they would have retired from service on having attained the age of 55 years ant this was patently unreasonable. On behalf of the and Officers who were promoted in the vacancies created by the retirement of those who 577 had attained the age of 55 years, it was submitted that there was no discrimination whatsoever and that what the had done w merely to classify those employees who had ceased to be in service or who should have ceased to be in service And refused to apply the increased age of superannuation to them. Having gone out of service, there was no question of their being eligible to the increased age of superannuation and therefore, the classification was perfectly reasonable. It was also urged that appointments and promotions were made subsequent to the reduction of the age of superannuation on regular basis ant those appointments aud promotions could not therefore be disturbed. ^ HELD: [By the Per , & , JJ.] 1. Clause 3 (1) of Ordinance No. 24 of 84 and Section 4(1) of Act NO.. 3 of 1985 be brought to conform to the requirements of Article 14 of the Constitution by striking down or omitting the word 'not' from those provisions. [615 G] 2. In exercise of powers under Art. 32 ant 142 of the Constitution the following directions given : a. All employees of the , public Corporations ant local authorities, who were retired from service on the ground that they hat attained the age of 55 years by 28.2.83 or between 28.2.83 ant 23.8.84 shall be reinstated in service provided they would not be completing the age of 58 years on or before 31.10.1984. [616 B-C] - b. All employees who were compelled to retire on February 28, 1983 and between February 28, 1983 and August 23, 1984 and who are not eligible for reinstatement under the first clause, shall be entitled to be paid compensation equal to the total emoluments which they would have received, hat they been in service until they attained the age of 58 years, less any amount they might have received. They will be entitled to consequential retiral benefits. [616 D] c. Such of the employees as have not been compelled to retire by virtue of orders of stay obtained from or or who have actually been reinstated in service pursuant to interim orders cf this , shall be allowed to continue in service until they attain the higher age of superannuation. [616 F] 578 d. The reinduction of those employees that have been A compelled to retire previously, will put them back as regards their seniority in precisely the same position which they occupied before they were retired from service and be entitled to all further consequential benefits. [616 G] e. The employees who were retired and who are reinducted will be entitled to be compensated for the period during which they were out of service. [616 H] f. In the matter of reinduction of employees who do not attain the age of 58 years on or before 31st October, 1985 the may exercise an option not to reinduct then provided the employees are paid the compensation. [617 A] g. The government is free to revert persons promoted or appointed to the posts held by persons who were retired on having attained the age of 55 years by 28.2.1983 or between 28.2.83 and 23.8.84 to the posts which they held on February 28, 1983 or on the dates previous to their promotion or appointment provided that they need not be so reverted, if they would otherwise be entitled to be promoted or appointed even if the other employees had not been retired consequent on the lowering of the age of superannuation. [617 C] h. The shall be free to create supernumerary posts whenever they consider it necessary 80 to do. [617 E] i. All payment of compensation to be made and completed before December 31, 1985. If for any reason the finds itself unable to a pay the entire amount at one time or within the time fixed, the will be at liberty to pay the amount in not more than four instalments within the time stipulated. Where the employees are awarded compensation, they may apply to the concerned Income Tax Officer for relief under Section 89 of the Income Tax Act read with Rule 21-A of the Income Tax Rules. [617 F] 3a. The dismissal in limine of the earlier Writ Petition cannot possibly bar the present Writ Petitions. Such a dismissal may inhibit the courts' discretion but not its jurisdiction. [615 D] 3b. Even if some affected parties have not been impleaded their interests are identical with and have been sufficiently and well represented. The relief claimed is of a general nature and against the and no particular relief is claimed against any individual party. [615 F] 579 3c. It is one thing to say that the Executive has no power to pass an order extending the service of a servant after he has retired from service; it is altogether a different thing to say that the while making a law raising the age of superannuation cannot make an unreasonable classification to exclude some Servants from the benefit of the increased age of superannuation. The classification must pass the dual test of beating reasonable and related to the object of the legislation, besides not being arbitrary. It is not t open to the to make an arbitrary classification first by making the date dependent on an uncertain event namely, the date of pronouncement of the Judgment by and next by making a legislation excluding persons who had attained the age of 55 years before the legislation took effect though the legislation itself was designed to undo the wrong already done to the very employees. [604 F-605 A] 3d. Whenever a law is made or whenever an action is taken, lt has to be with effect from a certain date but it does not necessarily follow that the choice of the date is not open to scrutiny at all. If the choice of the date is made burdensome to some of those, the wrong done to whom is sought to be rectified by the law, it would certainly be open to the court to examine the choice of the date of find out whether it has resulted in any discrimination. [605 , 2 S.C.R. 165 referred to. v. of Uttar Pradesh & Ors. 1 S.C.R. 693, A.I.R. 1985 S.C. 551 and A.I.R. 1965 S.C. 473 distinguished. 4. (a) As the judgment was not pronounced for long, it became imperative for the to implement their decision of their own accord and so they passed Ordinance No. 24 of 1984 and Act No. 3 of 1985 amending Act No. 23 of 1984 by substituting 58 years for 55 years. While doing 80, unfortunately again, those that had suffered most by being compelled to retire between 28.2.83 and 23.8.84 were denied the benefit of the legislation by cl. 3(1) of the Ordinance and Sec. 4 (1) of Act No.3 of 1985. Now if all affected employees hit by the reduction of the age of superannuation formed a class and no sooner than the age of superannuation was reduced, it was realist that injustice had 580 been done and it was decided that steps should be taken to undo what had been done, there was no reason to pick out a class of persons who deserved the same treatment and exclude them from the benefits of the beneficient treatment by classifying them as a separate group merely because of the delay in taking the remedial action already decided upon. [611 D-F] 4. (b) The action of the and the provisions of the legislation were plainly arbitrary and discriminatory. The division of employees into two classes those who had already attained the age of 55 on 28.2.83 on the one hand, and those who attained the age of 55 between 28.2.83 and 23.8.84 on the other and denying the benefit of the higher age of supernnuation to the former class is as arbitrary, as the division of employees entitled to pension in the past and in the future into two classes, that is, those that had retired prior to a specified date and those that retired or would retire after the specified date, and confining the benefits of the new pension rules to the latter class only. [611 G-612 A] 5. Legislations to remedy wrongs ought not to exclude from their purview a few of the wronged persons unless the situation and the circumstances make the redressal of the wrong, in their case, either impossible or 80 detrimental to the public interest that the mischief of the remedy outweighs the mischief sought too be remedied. In the instant case, there is no such impossibility or detriment to the public interest involved in reinducting into service those who had retired as a consequence of the legislation which was since though to be inequitable and sought to be remedied [612 B-C] 6. The burden of establishing the reasonableness of a r classification and its nexus with the object of the legislation is on the . [612 D] 7. We are governed by the Constitution and Constitution must take precedence over convenience and a judge may not turn a bureaucrat. It may be possible that in a given set of circumstances, portentous administrative complexity may itself justify a classification. But there must be sufficient evidence of that how the circumstances will lead to chaos. Ups and downs of career bureaucrats do not by themselves justify such a classification It may however be of some consequence in the matter of granting relief. For instance there would be really no point in reinducting an employee if he has but a month or two to go to attain the 581 age of 58 years to retire. Reinduction of such a person is not likely to be of any use to the administration and may indeed be detrimental to the public interest. It is found to be wasteful. In such cases as well as in cases where they can't be reinducted because they have already completed 58 years by now, they cannot obviously be reinducted. The obvious course is to compensate them monetarily. [613 H-614 C] 8. In Industrial Law back and future wages are awarded on quite a large scale ant there is no reason why the same principle cannot be adopted. If as a rule private employers in such situations are asked to pay back wages, there is no impediment in doing so in the case of those that are expected to be a model employer i.e. the , public corporations and local authorities. [614 D] 9. Where internal aids are not forthcoming, recourse to external aids are not ruled out. This is now a well settled principle of modern statutory construction. The 'Enacting History' of an Act is relevant. It is the surrounding corpus of public knowledge relative to its introduction into as a Bill, and subsequent progress through and ultimate passing by, . In particular it is the extrinsic material assumed to be within the contemplation of when it passed the Act. The history of how an enactment is understood forms part of the contemporanea exposition and may be held to throw light on the legislature's intention. The later history may, under the doctrine that an act is always speaking, indicate how the enactment is regarded in the light of development from time to time. Official statements by the department administering an Act, or by any other authority concerned with the Act, may be taken into account as persuasive authority on the meaning of its provision. [591 A-D] 10. Committee reports, ary debates, policy statements and public utterances of official spokesman are of relevance in statutory interpretation. But the comity, the courtesy and respect that ought to prevail between the two prime organs of the , the and the judiciary, require the courts to make skilled evaluation of the extra textual material placed before it and exclude the essentially unreliable. Nevertheless the court, as master of its own procedure, retains a residuary right to admit them where, in rare cases, the need to carry out the legislator's intention appears to the court so to require. No rule prevents the court from inspecting in private 582 whatever materials it thinks fit to ensure that it is well informed. Where these materials constitute publicly available documents, the court takes judicial notice of them. The court has an inherent power to inspect any material brought before it. This is to enable the court to determine whether the materials is relevant to the point of construction in question and if so whether it should be admitted. This has to be done with a degree of inhibition and an amount of circumspection. 1591 E-G] 11. The history and the succession of events, the initial lowering of the age of superannuation, the agitation consequent upon it and the agreement that followed the agitation clearly indicate that the object or Ordinance No. 23 of 1984 ant Act No 3 of 1985 was to undo the mischief or the harm that had been done by the lowering of the age of superannuation from 58 years to 55 years and to restore the previous position. It was not a case of change of policy consequent on change of social circumstances. It was not a case of a change of policy to set right immediately the recent wrong perpetrated by a well intentioned but perhaps ill thought measure. It was not at all a case of reversal of policy because of changed circumstances. [591 H-592 B] 12. While it is a general rule of law that statutes are not to operate retrospectively, they may so operate by express enactment, by necessary implication from the language implied, or where the statute is explanatory or declaratory or where the statute is passed for the purpose of protecting the public against some evil or abuse or where the statute engrafts itself upon existing situations etc. But it would be incorrect to call a statute 'retrospective', \"because a part of the requisites for its action is drawn from a time antecedent to its passing\". [614 G-615 A] R.V. St. Mary, Whitechapel [Inhabitants] 12 O.B. 120, referred to. 13. Unlike in the United Kingdom here in India we have written Constitution which confers justiciable fundamental rights and 80 the very refusal to make an Act retrospective or the nonapplication of the Act with reference to a date or to an event that took place before the enactment may, by itself, create an impermissible classification justifying the striking down of the non retroactivity or not application clause, as offending the fundamental right to equality fore the law and the equal protection of the laws. 1615 B] 583 [Per V. , J. concurring.] In is now well established by decisions of this that the has full power to effect a change in the age of superaunuation cf its employees on relevant considerations. If in the exercise of such power the age of superannuation is enhanced purely by way of implementation of a policy decision taken by the , such alteration can legally be brought about with prospective effect from the date of the commencement of the operation of the Ordinance, Act or Rule and no question of violation of Article 14 or 16 of the Constitution will arise merely because the benefit of the change is not extended to employees who have already retired from service. [618 D-E] [Per V. , J. Concurring] In matters relating to policy decisions the charge of arbitrariness cannot be laid at the doors of the . the have full powers to decide about the age of retirement considering the various data available before it. [619 F] Removing a word or adding words to a legislative enactment is an exercise, s have been repeatedly warned against from embarking upon. This guideline is one that has to be respected by the s of Law. [620 F] Normally this will be disinclined to entertain or to hear petitions raising identical points again where on an earlier occasion, the matters were heard and dismissed. Not that this has no jurisdiction to entertain such Matters, but that it would normally exercise its discretion against it. [621 C] In the instant case, the petitions involve a serious human problem. Employees of the with limited resources, who have been planning their future with a secure feeling that they could work till the age of 58 years, have overnight, been robbed of their tenure, their aspirations and future. They have become the helpless victims of certain moves on the political chess board. These swift moves taken in a hurry without serious application of mind have resulted in arbitrariness which has been forcefully projected by the petitioners, This plea cannot be light heartedly thrown overboard. Justice demands that the petitioners should be saved of their predicament. This has to share for the sorry state that has come to pass in the matter. The damage had been done and it can be repaired only be extending 584 this 's powers to a section of employee who deserves sympathy and fair deal. The case is more or less evenly balanced between the parties. The benevolent jurisdiction of Article 142 (1) of the Constitution has therefore to be invoked. [621-H- 622 B. 621 F] K. Nagera p v. of A.P. A.I.R. 1985 S.C. 551, v. of U.P. and others, 1 S.C.R. 693 and 2 S.C.R 165, referred to. JUDGMENT: ", "ORIGINAL JURISDICTION : Writ Petition Nos. 5447-5546 of 1985 etc. etc. (Under Article 32 of the Constitution of India.) , , , , , , , , Mrs. , , , Ms. , , , , , , , , , , , H.S. , Mrs. , , , , and for appearing Petitioners. ", ", Advocate General of , , , , , ; , , , , Mrs. , , and Mrs. for Respondents. ", "The following Judgments were delivered : ", ", Tossed about by the , the and, we are sorry to say, by us the ) too, and therefore, totally bewildered, several civil servants employees of public sector corporations and teachers working under various local authorities are now before us wanting to know where they stand and to what Justice and relief they are entitled. In February, 1983, decided to reduce the age of superannuation of its employees from 58 to 55 years. The also issued directives to local authorities and public corporations under its control to do like wise. The age of superannuation was in fact 55 years to begin with. But, earlier, in the year 1979, had raised the age of superannuation to 58 years, presumably, because of the increased average human longevity in India, the better health and medical facilities available, the improved standard of living, the usefulness in service of experienced employees, the employment situation and potential and such other relevant considerations. But in February 1983, the decided to reduce the age of superannuation. In order to give effect to their policy of reversal, i.e.. the policy of reducing the are of superannuation from 58 to 55, the amended Rule 56 (8) of the Fundamental Rules and Rule 231 of the Hyderabad Civil Services Rules by substituting the figure '55' for the figure '58' and by making a special provision that those who had already attained the age of 55 years and were continuing in service beyond that age on 8.2.1983 shall retire from service on the afternoon of 28. 1983. The notifications by which these amendments were carried out were followed by another notification dated 17.2.1983 deleting the proviso to Rule 2 of the Fundamental Rules which protected a civil servant against a charge of his conditions of service to his detriment after he entered service. m is was followed by the promulgation of the Andhra Pradesh Ordinance No. 5 of 1983 regulating the recruitment and conditions of service of persons appointed to public service and posts in connection with the affairs of the State of Andhra Pradesh and the officers and servants of . Clause 10 of the Ordinance provided that 'every employee, not being a workman and not belonging to Last Grade Service shall retire from service in the afternoon of the last day of the month in Which he attains the age of fifty five years.' In the case of employees belonging to , it was provided that they shall retire from Service on the afternoon of the last day of the month in which they attain the age of sixty years. Clause 18 (1) provided that the proviso to rule 2 of the Fundamental Rules shall be and shall be deemed always to have been omitted. Now immediately after the notifications reducing the age of superannuation from 58 to 55 were issued, a large number of employees, employees of public sector corporations and teachers working under various local authorities filed writ petitions in this Court as well as in challenging the vires of the provisions reducing the age of superannuation. After promulgation of the ordinance, they were permitted to amend the petitions to question the appropriate provisions of the ordinance too. The petitions in this Court were heard at great length for several days by , CJ, , and and Judgment was reserved on 27.7.83. The judgment was however pronounced only on January 18, 1985. The impugned provisions were upheld and all the writ petitions were dismissed. In the meanwhile much water had flown under the bridge. There were agitations and agreements. There were twists and turns of political power. There were amendments to the legislation, once more raising the age of superannuation. Learned counsel informs us that the subsequent events were brought to the notice of the court and that a petition was also filed to amend the writ petitions and to raise additional grounds. The Court however refused to take notice of the subsequent events and proceeded to pronounce their judgment with reference to a situation which obtained several months ago and which situation stood considerably altered and had even become unreal by the subsequent march of events. It was a great pity. Much confusion and heart-burning might have been avoided, as we shall presently see. ", "It is now necessary to mention in greater detail the events that followed the reduction of the age of superannuation from 58 to 55 years. We referred to agitations and agreements. It appears that soon after the reduction of the age of superannuation, there was a state- wide agitation by affected employees and on August 3, 1983, an agreement was arrived at between and in Andhra Pradesh. ", "Clause (1) of the Agreement is important and may be usefully extracted. It is as follows: ", "All provisions relating to Ordinance 5 of 1983, except those. relating to the age of superannuation, will be deleted at an early date. Proviso to F.R.2 will be restored in respect of all matters, except the age of superannuation retrospectively. The provisions of the Ordinance relating to the age of superannuation will also be removed after the judgment of , provided that such removal will not adversely effect the right of Government as determined by judgment to fix the age of superannuation. ", "If upholds the power of the to reduce the age of superannuation without referring to the provisions in the ordinance and F.R.2, the entire ordinance will be scrapped and F.R.2 will be restored. ", "This clause of the Agreement shows that while the was anxious to obtain a judgment of securing their right of 'fix the age of superannuation', they had also realised that grave wrong and injustice had been done to its employees by their earlier action in reducing the age of superannuation. They were anxious to undo the wrong and do justice to their employees, while preserving their own power to act in the future, if and when necessary. That apparently was the reason why the agreed to scrap the whole of the ordinance if upheld the power of the to reduce the age of superannuation and further agreed to delete provision relating to the age of superannuation in the ordinance, after the judgment of was pronounced. Clause (1) of the Agreement expressly provides that proviso to F.R. 2 will be restored in respect of all matters, except the age of superannuation retrospectively. It is then followed by the sentence : The provisions of the ordinance relating to the age of superannuation will also be removed after the judgment of .' The clear implication appears to be that the provisions of the ordinance relating to the age of superannuation will also be removed in the same manner as the proviso to Fundamental Rule 2 i.e. restrospectively. Otherwise the agreement would make no sense. Those attain ng the age of 55 years before judgment was pronounced would just have to walk out while those who did not would stay on. Surely their fate was not to hang on a date. ", "The Agreement, however, contained a further curious stipulation that it was not to be placed before either by the or by the employees. Perhaps the stipulation was intended to prevent from abstaining from pronouncing upon the power of the to reduce the age of superannuation. Quite obviously the Agreement contemplated that the judgment of would be forthcoming very soon. But that was not to be. ", "There was considerable discussion at the whether the agreement contemplated and stipulated restoration of 58 years as the age of Superannuation if the power of the to reduce the age of superannuation was upheld by . The agreement appears to us to be clear and categoric and a reference to the pleadings demonstrates that the also never doubted the employees' interpretation of agreement. In Para 2 (h) of the petition in Writ Petition No. 3420-26 of 1985, the petitioners asserted, \"It is pertinent to point out that in the interregnum between the Writ Petition being admitted in and the judgment being delivered a State wide agitation took place in Andhra Pradesh by the Non Gazetted employees in the Andhra Pradesh State in June and July 1983. That agitation was for the purpose of demanding inter alia that the retirement age of the State employees be restored to 58 years. Ultimately, on 3.8.1983, an agreement was arrived at between the State and in Andhra Pradesh by which it was agreed the State would restore the age of retirement to 58 years if upheld the State 's Power to reduce the age of retirement. The said agreement which was a detailed agreement entered into between On behalf of the whom the negotiations were conducted by the then Chief Secretary Shri , and of the employees and workers, which represented 39 service organisation.\" ", "To this the answer of the Government in their counter was: ", "\"I state with respect to paragraph 2 that this paragraph deals with narration of facts regarding the circumstance under which the age of retirement was enhanced and the recommendations of etc. Hence they require no comments. It is respectfully submitted that all these relevant facts have been taken into consideration by while rendering the judgment upholding G.O.Ms. NG. 36 dt. 8.2.1983. In its judgment since reported in [1985] 1 S.C.C. page : 524. Hence there is no necessity to traverse those facts once again herein.\" and \"I further state that it is not proper for the petitioner to have filed the agreement reached between the employees Union and the state of Andhra Pradesh as Annexure to the Writ Petition. Under the last clause of the Agreement reached between and the State of Andhra Pradesh that the agreement shall not be placed before by the Government or the members of the employees associations. Contrary to the provisions of the agreement the petitioners have chosen to file this agreement in support of their case and pleaded for enhancement of the age of retirement. ", "The Government's objection was not to the interpretation placed upon the agreement by the parties but to its being brought to the notice of-the . ", " enacted the Andhra Pradesh Public Employment (Regulation of Age of Superannuation) Act No. 23 of 1984 making lt applicable to all persons appointed to public services and posts in connection with the affairs of the state, all officers and other employees working in any local authority, whose salaries and allowances were paid out of , all persons appointed to the Secretariat staff of : and all officers or employees whole conditions of service were regulated by rules framed under the poviso to Art. 309 of the Constitution immediately before the commencement of this Act. Sub-section (3) of s. 1 stated 'Clause (i) of s. 7 shall be deemed to have come into force on the April 29, 1983. Sections 3 (1) and (2) were as follows: ", "\"3 (1) Every Government employee, not being a workman and not belonging to Last Grade Service shall retire E from service on the afternoon of the last day of the month in which he attains the age of fifty five years. ", "(2) Every Government employee not being a workman but belonging to shall retire from service on the afternoon of the last day of the month in which he attains the age of sixty years. ", "Explanation II(b) to s. 3 was to the following affect: ", "\"(b) a employee who attained the age cf superannuation but who was allowed to continue to hold the post beyond that date, but virtue of a stay order of a Court, shall be deemed to have ceased to hold the post and relieved of his charge from the date of the judgment dismissing his petition, irrespective of whether the charge of the post was handed over or not as prescribed in any rule or order of the for the time being in force. ", "590 ", "On August 23, 1984, the Andhra Pradesh Public Employment [Regulation of Age of Superannuation Act No. 23 of 1984 was amended by the promulgation of Andhra Pradesh Ordinance No. 24 of 1984 providing that in s. 3(1) of the Act and in Explanation II (a), the words fifty eight years' shall be substituted for the words fifty five years. This was obviously done to give effect to the agreement of August 3, 1983 and to fulfil the promise held out therein that the age of Superannuation would be restored to 58 years. Clause 3(1) of the Ordinance is the much disputed provision and it has therefore, to be extracted in full. It is as follows: ", "\"3(1) The provisions of this Ordinance shall not apply to persons who attained the age of superannuation in pursuance of the notifications issued in G.O.Ms. No. 36, Finance and Planning (Finance Wing-F.R.I.) Department, dated the 8th February, 1983, or in pursuance of the provisions of the Andhra Pradesh Public Employment (Regulation of Age of Superannuation) Act, 1984, as in force prior to the commencement of this Ordinance. ", "Andhra Pradesh Ordinance No. 24 of 1984 was replaced by Act No.3 of 1985. By Sec. 2 of the Amending Act , the words 'fifty five years' were substituted by the words 'fifty eight years' in Sec. 3(1) and Explanation II (a) of the Principal Act. Section 4 of the Amending Act which is more or less on the same lines as h Clause 3(1) of the Ordinance says: ", "\"4(1) The provisions of section 2 of this Act shall not apply to persons who attained the age of superannuation in pursuance of the notifications issued in G.O.Ms. No. 36 , dated the 8th February, 1983, or in pursuance of the provisions of the Andhra Pradesh Public Employment (Regulation of Age of Superannuation) Act, 1984, as in force prior to the commencement of this Act. ", "No explanatory statement accompanying Ordinance to. 23 of 1984 was brought to our notice. The statement of Objects and Reasons of Act No. 3 of 1985 was however placed before US but it is not helpful to ascertain the reasons which led the legislature to restore the age of superannuation to 58 years. If merely states that the Government considered it necessary to raise the age of superannuation from 55 to 58 years . But we are not altogether helpless. Where internal aids are not forthcoming, we can always have recourse to external aids to discover the object of the legislation. External aids are not ruled out. This is now a well settled principle of modern statutory construction. Thus 'Enacting History' is relevant: The enacting history of an Act is the surrounding corpus of public knowledge relative to its introduction into as a Bill, and subsequent progress through, and ultimate passing by, . In particular it is the extrinsic material assumed to be within the contemplation of when it passed the Act. Again In the period immediately following its enactment, the history of how an enactment is understood forms part of the contemporanea expositio, and may be held to throw light on the legislative intention. The later history may, under the doctrine that an Act is always speaking, indicate how the enactment is regarded in the light of development from time to time. Official statements by the government department administering an Act, or by any other authority concerned with the Act, may be taken into account as persuasive authority on the meaning of its provisions. Justice may be blind but it is not to be deaf. Judges are not to sit in sound proof rooms. ", "Committee reports, Parliamentary debates, Policy statements and public utterances of official spokesmen are of relevance in statutory interpretation. But 'the comity the courtesy and respect that ought to prevail between the two prime organs of the , the legislature and the judiciary', require the courts to make skilled evaluation of the extra textual material placed before it and exclude the essentially unreliable. Nevertheless the court, as master of its own procedure, retains a residuary right to admit them where, in rare cases, the need to carry out the legislator's intention appears to the court so to require. No rule prevents the court from inspecting in private whatever materials it thinks fit to ensure that it is well informed, whether in relation to the case before it or generally. Where these materials constitute publicly available enacting history, the court takes judicial notice of them. The court has an inherent power to inspect any material brought before it. : Statutory Interpretation. This is to enable the court to determine whether the material is relevant to the point of construction in question, and if so whether it should be admitted. This has to be done with a degree of inhibition and an amount of circumspection. ", "Here, the facts speak for themselves. Res Ipsa Loquitur. The history and the succession of events, the initial lowering of the age of the superannuation, the agitation consequent upon it and the agreement that followed the agitation clearly indicate that the object of Ordinance No. 23 of 1984 and Act No. 3 of 1985 was to undo the mischief or the harm that had been done by the lowering of the age or superannuation from 58 years to 55 years and to restore the previous position. Quite obviously, lt was not a case of change of social circumstances. It was a case of a change of policy to set right immediately a recent wrong perpetrated by a well intentioned but perhaps ill-thought measure. It was not at all a case of reversal of policy because of changed circumstances. A reference to the note file which was made available to us by the learned Advocate General of Andhra Pradesh at our instance shows that it was after a careful consideration of the representations made by the various services associations in regard to the restroation of the age of superannuation to 58 years that the Government resolved to restore the age of superannuation to 58 years, In the counter, the Government appeared to take the stand that the Governments of the States of Karnataka and Rajasthan had raised the age of superannuation to 58 years and the Government of Andhra Pradesh wanted to fall in line. It was a wholly inaccurate statement. There is no reference in the note file or elsewhere, except for the first time in the counter, to the circumstance that two other State Governments had raised the age of superannuation and had a accepted their wisdom. The statement in the counter must be ignored. A reference to the pleadings is revealing, if not, startling. In Writ Petition Nos. 3420-3426/85 in paragraph 5, the petitioner averred: ", "\"In fact , Chief Minister himself admitted that he was misguided and misled by the then Finance Minister and the Chief Secretary when his Government took the decision to reduce the age of retirement. His press conference dated 25.9.1984 was reported in as follows: ", "\"Chief Minister today announced that his government would retain the age of superannuation of the employees at 58 years as decided by the short-lived . ", "Briefing newsmen after the meeting this afternoon, Mr. said the had reviewed the decision of the previous Government to raise the age of superannuation from 55 years to 58 with effect from August 23, 1984. ", "593 ", "The Chief Minister charged that Mr. , the then Finance Minister and the then Chief Secretary Mr. had misled him when his Government decided to reduce the age of superannuation from 58 to 55. Both have not raised any objection to the proposal. Despute knowing well that the 'unpopular' have would be detrimental to the Government, they had allowed it go with the evil intention of discrediting him, he allegeded. ", "Mr. said it was not his intention to hurt the interests of any section of the people and the employees constituting a sizeable number who had voted his party to power. However it is not possible for the to concede the request of those who had already retired , he observed. ", "The said report has never been denied or resiled by the Chief Minister. ", "In answer, the averment was not denied. The deponent of the counter affidavit stated: ", "\"I state with respect to paragraph:5 that it is not open to the petitioner to rely on paper cuttings in support of their contention unless otherwise they are proved apart from the fact that the statement in paper cuttings are in no way advance the case of the petitioner. ", "This can hardly be considered to be a denial of what was said in paragraph 5 of the petition. We must therefore, proceed on the basis that the Chief Minister () did allege that when the took the decision to reduce the age of superannuation, he was, 'Misguided and misled' by his Finance Minister and the Chief Secretary. It may be a sorry confession to make on the part of a Chief Minister, especially when it was a momentous decision involving the lives and future of thousands of employees. One wonders how a decision concerning the lives and the future of civil servants, who all their lives in the past, had loyally served the , could have been taken in such a hasty and haphazard fashion. One would expect such a decision to be taken after a full investigation into the multitudinous pros and cons, after deep collection of all pertinent data and after deep consideration of every aspect of the question. But there we have a statement attributed to the Chief Minister that he was 'misled and misguided' by the Finance Minister and his Chief Secretary. Sorry confession, it may be, but a frank and courageous admission it was, exposing him to criticism. It does require a sturdy spirit to own a mistake. ", "During the pendency of the Writ Petitions in this Court, several employees of local authorities etc. Obtained orders of stay from and were continuing in service on the dates when the judgment of was pronounced. After the pronouncement of the judgment of , the authorities that be have sought to give effect to the provisions of the Act and the Ordinance by seeking to throw them out on the ground that they had completed 55 years of age during the interregnum between February 28, 1983 and August 23, 1984 some others who had completed 55 years between February 28, 1983 and August 23, 1984 but who had not completed 58 years sought re-entry was notwithstanding the raising of the age of superannuation from 55 years Co 58 years. Their re-entry was sought to be resisted on the basis of Cl.3(1) of the Ordinance and S.4(1) of the Amending Act . Those employees who were sought to be removed from service or who were denied re-entry into service on the ground that they had attained the age of 55 years between February 28, 1983 and August 23, 1984, have once again invoked the jurisdiction of this Court and sought appropriate writs from this Court to continue or to reinstate and continue them in service until they attain the age of 58 years. They are the petitioners in Writ Petitions Nos. 3203, 3413-3419, 3420-3426 etc. etc. Of 1985. They sought interim orders from this Court. ", "On 23.4.85 interim directions to the following effect were issued by and , JJ: ", "(1) From amongst those Government servants and servants of Local and other authorities governed by the decision of On reduction of age of retirement from service from 58 years to 55 years, who continued in service or continued to hold the post on April 1, 1985 for any reason including the grant of interim relief by and who are removed from that post after that data shall be reinducted and put back in the post from where he/she was removed. ", "(2) Those Government Servants and others enumerated a in No.(1) here and who are today in service and are likely to- be removed on account of the reduction in age of superannuation notwithstanding restoration of higher age, whatever be the case, shall continue in service till further orders. (3) Those Government servants and others enumerated in No.(1) here who were in service prior to April 1, 1985 and who are removed from service on account of reduction in age, shall be reinducted in service, if the posts from each one was removed is still vacant or someone is holding a temporary charge. ", "(4) Those directions shall be carried out and given effect to within one week from today. (5) These directions will also cover those Government servants who are similarly situated but have not filed the SLPs and WPs. ", "(6) Government servants referred to in No.(1) will also comprehend members of . ", "The matter was mentioned again on two occasions for clarification and the following orders were then made by , and , JJ. The order made on May 6, 1985 said: ", "We do not see any ambiguity in Cl.3 of the order dated 23rd April, 1985. It is directed that Cl.3 or the order dated 23rd April, 1985 should be implemented to the extent that promotions made to the posts which are held by the officers will be made under Rule 37 by temporary appointments and the Chief Secretary and other two senior Secretaries will examine the question as to how many such vacancies could be filed and it is further directed that from out of the petitioners one who has the longest service will be selected. The order will be carried out within two weeks from today. This is without prejudice to the vacancy clause. All these appointments will be subject to the result of these petitions. ", "The order made on May 7, 1985 said: ", "\"We do not see any ambiguity in clause 3 or the Order dated 23rd April, 1985. It is directed that clause 3 of the order dated 23rd April, 1985 should be imple- ", "596 ", "employees were moved are still vacant or where such post is held temporarily by others on promotion under Rule 37 of the A.P. States Subordinate service Rules. The Chief Secretary and two other Senior Secretaries will examine the question as to how many such posts could be filed and it is further directed that in cases where more than one person has retired from a post, the person having the longest service should be selected. The Order will be carried out within two weeks from today. All these appointments will be subject to the result of the Petitions. ", "These interim orders were made under the misapprehension that all so-called promotions would only be made under Rule 37 whereas whenever a promotion was made from a lower service to a higher service, it was not called a promotion but was styled as an appointment and was made under Rule 10. Since Rule 10 was not mentioned in the orders, persons who had been 'promoted' and appointed under Rule 10 claimed that they could not be displaced. ", "Some others though promoted under Rule 37 claimed that they had in fact been promoted regularly after a proper selection by but that according to the practice prevailing in Andhra Pradesh, their orders of promotion mentioned that they were prompted temporarily, though in fact they had been promoted regularly. Many such persons, claiming to have been appointed under Rule 10 or claiming to have been promoted regularly notwithstanding the mention of Rule 37, filed Writ Petition Nos. 5447-5546 of 1985 etc. etc. questioning the orders of reversion with which they were faced consequent on the interim directions given by and ,. During the vacation, J. stayed the orders or reversion passed by the in order to reinduct the retired employees. The interim orders granted by J. appeared to conflict with the earlier interim orders granted by this . When all the interim applications came before us a few days back, we directed that all the Writ petitions may be placed before us for final disposal and that is how the matters are now before us. ", "Before referring to the submissions of the parties on the principal question of discrimination and arbitrariness, it is necessary to ascertain the exact factual situation in regard to certain other matters, besides those to which we have already referred. First in regard to the question whether the vacancies arising consequent on the application of the reduced age of superannuation have been filled and if filled, whether they have been filled on a regular or temporary basis? In Writ Petition No. A 3170/85, a Deputy Secretary to the Government of Andhra Pradesh, speaking for the government of Andhra Pradesh swore to a counter-affidavit in May 1985 in which he stated that: ", "\"I state with respect to paragraph 8, that it is not correct to state that only few vacancies have been filled on temporary basis on the specific condition of review and revision on the basis of outcome of the judgment in the Writ Petitions filed by the employees due to the retirement at the age of 55 years pending in . It is submitted that it is wholly untrue to say that few vacancies have been filled up. Consequent on the reduction in the age of superannuation the Government took every step to see that most of the vacancies have been filled up in accordance with rules on regular basis. It is only in few cases, temporary promotions have been effected pending writ petitions. It is submitted that Ann.-I to this counter affidavit gives particulars regarding the vacancies that arose due to the reduction in the age of retirement on 28.2.1983 and the vacancies filled up and the vacancies existing. m ere are very few vacancies in the lower echelons. I also submit that the existing few vacancies are due to administrative dealy, or vacancies that arose latter after originally filling the vacancies. ", "In Writ Petition Nos. 5447-5546/85, there was a complete volte face ant the very same Deputy Secretary speaking again for said: ", "In so far as the first point is concerned in none of the cases there were regular promotions. All the promotions were officiating/Temporary/adhoc which would be clear from orders of promotion, some of which have been produced by the petitioners themselves. The promotions were either subject to the result of the writ petitions then pending in this Honourable court challenging reduction of retirement age from 58 to 55 years, Or some other proceedings relating to inter- seniority pending either in or in or in , Or because of the pendency of finalisation of seniority lists and consequent review of promotions under the State Reorganisation Act . Further the Writ Petitions questioning the reduction of age of retirement from 58 to 55 in G.O.Ms.No. 36, dated 8.2.83 were heard and judgment was reserved on 27th July, 1983. Since the judgment was reserved, the judgment was expected at any movement. Hence the Government were making only officiating/temporary promotions under rule 37. Under the circumstances it was not possible to make regular appointments/promotions. Therefore, the petitioners were rightly reverted in accordance with the directions of dated 6.5.1985 and 7.5.85. There was / question of either giving them any notice or hearing before the orders of the reversion are passed, as in terms of Rule 37 (dd), they could be reverted without any notice or hearing. \"Persons holding the posts under Rule 10 have no right to the posts and their appointments/promotions were purely temporary/adhoc. ", "\"Hence, I state that the`petitioners continue to be adhoc promotees under Rule 37 and not regular employees as claimed by them. ", "and: ", "Admittedly, the petitioners were promoted under Rule 37 consequent to the vacancies which arose due to the retirement of several persons at the age of 55 years. The Government never intended to appoint them on regular basis pending writs and judgment before . In case the promotions were effected regularly legal complications will set in the event of the judgment of going against deliberately made Rule 37 promotions so that in the event of the judgment going adversely against , there may not be any difficulty in reverting Rule 37 promotees and reinducting the employees affecting by G.O.Ms.No. 36 dated 8.2.83. Fortunately, the judgment of comes in favour of . ", "It is amazing that the same Deputy Secretary to the , representing the same , should have sworn to two such contradictory affidavits. It reveals a total sense of irresponsibility and an utter disregard for veracity. It shows that the deponent had signed the affidavits without even reading them or that he signed them to suit the defence to the particular writ petition without any regard for truth. In either case, it is reprehensible and totally unworthy of the spokesman of a and must unflattering to the on whose behalf he spoke. We would have contemplated severe action against the dependent, had we not the feeling that the responsibility for his statements lies with undisclosed higher echelons and we need not make a scapegoat of him. In fact, in a case like this involving the entire body of servants in Andhra Pradesh, we would have expected the Chief Secretary or a Principal Secretary to file the counter. But they have chosen to keep themselves back. ", "However we have a duty to discover the truth. We think that the truth is what is stated in the counter-affidavit in Writ Petition Nos. 5447-5546/85. The counter-affidavit itself gives good reasons why the promotions appointments were made on a temporary basis and the reasons are acceptable. The statements in the counter-affidavit in writ Petition Nos. 5447-5546/85 are supported by the findings of the which was appointed by the government under the interim orders of this . The consisted of the Chief Secretary and two senior Secretaries and it was asked to examine the question of the availability of posts for reinduction of retired employees. The findings of the were mentioned in the counter-affidavit in Writ Petition Nos. 5447-5546/85 and this is what was said: ", "\"The Committee constituted under G.O.Ms. No. 205, dt.9.5.1985 has completed its task of determing the number of vacancies for which retired employees can be reinducted as per the directions of . Here below is given an abstract of the position as emerged. Total number of persons retired from 28.2.83 to 23.8.1984 due to reduction of age of retirement from 58 to 55 is 15,529 of these people 8.928 are eligible for reinduction as they are below 58 years. found that 2,770 posts are vacant and that 1751 persons have to be reverted as they were holding the posts on temporary promotions under Rule 37. Thus, the total number of vacancies to which retired persons could be reinducted as 4,521.\" ", "It was said that it was a practice in the State of Andhra Pradesh to make even regular appointments and regular promotions under Rule 10 and Rule 37 only and therefore, the mere fact that Rule 10 or Rule 37 was mentioned in an order of appointment or promotion would not necessarily make the appointment or promotion temporary. Such appointments or promotions, if made after going through the regular process or selection were to be considered as regular and not temporary notwithstanding the mention of Rule 10 or Rule 37. But here as pointed out in the counter, there was a special situation immediately after the age of superannuation was reduced, writ petitions were filed is and in the High Court and there was considerable agitation by the employees. The entire situation was fluid as it were and there was good reason for the Government to make the appointments and promotions on a purely temporary basis, and that was what they did. That the Departmental Committees recommended the temporary appointments and promotions made on the recommendation of . This is clear from the counter affidavit in Writ Petition on Nos. 5447-5546/85 where it is stated as follows in paragraph IV-B: ", "\"In certain cases, the promotions were given on the basis of the recommendations of but that does not mean that their promotions were regular. also makes recommendations for temporary appointments/promotions otherwise it will offend Art. 14 and 16 in case all eligible candidates are not considered for promotion even though the promotions is either officiating/temporary. Therefore, the mere section by- does not make their promotions regular. Promotion or posting after completion of training does not make the promotions regular. The promotion orders of the petitioners promoted under Rule 37 clearly show that their promotions were purely temporary. ", "It is in this setting and background of facts that we are required to consider the submissions made to us. The submission made by , and who appeared for the employees who attained the age of 55 years between 28.2.83 and 23.8.84, was that the classification of these persons as a separate group for the purpose of excluding them from the benefit of the redressal of the wrong done to the employees and the relief given to them by the amending Ordinance and the Act, was an unreasonable classification having no nexus whatever with the object of the legislation. They urged that every person who was in employment on 28.2.83 was hit by the reduction of the age of superannuation from 58 to 55 years and when it was realised that a grievous wrong had been done which it was necessary to set right by reversing the policy and such a policy decision was in fact soon taken there was no reason to postpone effect being given to the reversal of policy to an uncertain date, namely the pronouncement of the judgment by and thereby to exclude from the benefits of the change of policy that group of persons who had the misfortune of attaining the age of 55 years between the two dates. The learned counsel pointed out that the decision to reverse the policy having been taken, the uncertain date of pronouncement of judgment was an irrelevancy in fixing the date from which to give effect to the policy. In the event, the government also did not await the pronouncement of the judgment but came forward first with the Ordinance and then with the Act. Therefore the learned counsel urged, by merely giving them the appellation 'retirees' as the had done in this case, the group of persons who had attained the age of 55 years before the delayed date of giving effect to the reversal of policy could not be discriminated against. The question according to the learned counsel, was not one of retrospectivity at all, but one whether when making a legislation to right a wrong or remedy a mischief a group of persons who had also been wronged and suffered the mischief could be excluded by the mere mechanics of delayed legislation. further submitted that several persons who were continuing in service by virtue of orders of stay obtained from , were also sought to be sent away by the government on the ground that had they not obtained the orders of stay, they would have retired from service on having attained the age of 55 years. This he urged was patently unreasonable. On the other hand it was urged by the learned Advocate General of Andhra Pradesh, who appeared for the government of Andhra Pradesh, , , , and , learned counsel who appeared for the officers who were promoted in the vacancies created by the retirement of those who had attained the age of 55 years, that there was no discrimination whatever and that what the had done was merely to classify those employees who had ceased to be in service or who should have ceased to be in service and refuse to apply the increased age of superannuation to them. It was said that having gone out of service, there was no question of their being eligible to the increased age of superannuation and therefore, the classification was perfectly reasonable. It was also urged that appointments and promotions were made subsequent to the reduction of the age of superannuation on regular basis and those appointments and promotions could not be disturbed. We were told that interference by us at this stage would lead to administrative disorder, disaster and chaos. We would like to mention here that the learned Advocate General of Andhra Pradesh as well as the other learned counsel who appeared on either side presented their respective points of view very fairly and with moderation. The task of the learned Advocate General was particularly difficult as he stood between the devil and the deep sea as it were. ", "A situation such as the one before us had never presented itself to the court previously. Make this case a precedent for justice say one side; let this not be the first say the other. We have had cases where the age of superannuation had been raised from 55 to 58 years; we have had cases where having earlier raised the age of superannuation from 55 to 58 years, there was later a change of policy and the age of superannuation was once again reduced to 55 years. But this is the first occasion-neither our researches nor those of the learned counsel have been able to trace another case of this kind - where the age of superannuation was first raised from 55 to 58 years, there was then a change of policy a few years later reducing the age of superannuation from 58 to 55 years and finally there was again, within a few months, a reversion to the higher age of superannuation of 58 Years. ", "The cases of v. State of Uttar Pradesh Ors. [1965] 1 S.C.R. 693 and AIR 1985 S.C. 551, belong to the second category of cases. In 's case, by a notification dated November 27, 1957 the of Uttar Pradesh raised the age of superannuation from 55 to 58 years. On may 25, 1961 the reduced the age once against to 55 years, and further laid down that those who had continued beyond the age of 55 years owing to the earlier notification would be deemed to have been retained in service beyond the age of superannuation and would be compulsorily retired on December 31, 1961. The appellant who attained the age of 55 years on December 11, 1960 and was continued in service was one of those who was retired on December 31, 1961. He questioned the change in the rule of retirement on the ground that it was hit by Art. 14 in as much as it resulted in inequality between public servants in the matter of retirement. The argument was that when all those who had passed 55 years were asked to retire on December 31, 1960 some had just completed 55, some were 56, some were 57 and so on and, therefore, there was discrimination. Dealing with this question, speaking for the observed: ", "603 ", "\"The last argument that has been urged is that the new rule is discriminatory as different public servants have in effect been retired at different ages. We see no force in this contention either, retirement namely December 31, 1961 in the case of all public servants and fixes the age of retirement at 55 years. There is no discrimination in the rule itself. It is however urged that the second notification by which all public servants above the age of 55 years were required to retire on December 31, 1961 except those few who completed the age of 55 years between May 25, 1961 and December 31, 1961 shows that various public servants were retired at various ages ranging from 55 years and one day to up to 58 years. That certainly is the effect of the second order. But it is remarkable that the order also fixed the same date of retirement namely December 31, 1961 in the case of all public servants who had completed the age of 55 years but not the age of 58 years before December 31, 1961. In this respect also, therefore, there was no discrimination and all public servants who had completed the age of 55 years which was being introduced as the age of superannuation by the new rule by way of reduction were ordered to retire on the same date, namely December 31, 1961. The result of this seems to be that the affected public servants retired at different ages. Out this was not because they retired at different ages but because their services were retained for different periods after the fifty-five. Now it cannot be urged that if Government decides to retain the services of some public servants after the E` age of retirement it must retain every public servant for the same length of time. The retention of public servants after the period of retirement depends upon their efficiency and the exigencies of public service, and in the present case the difference in the period of retention has arisen on account of exigencies of public service. We are, therefore, of opinion that the second notification of May 25, 1961 on which reliance is placed to prove discrimination is really not discriminatory, for it has treated all public servants alike and fixed December 31, 1961 as the date of retirement for those who had completed 55 years but not 58 years up to December 31, 1961. The challenge therefore, to the two notifications on the basis of Art. 14 must fail.\" ", "604 ", "The situation which was considered in case was exactly the identical situation which obtained on February 28, 1983 in the present case and precisely the situation which was considered by the judgment pronounced on January 18, 1985 and which is reported in A.I.R. 1985 S.C. 551 as , the very judgment the delay in pronouncing which is said to have led to this confusion. Neither in case nor in 's case had the court occasion to consider the further step that had been taken in the present case, namely, once again raising the age of super annuation to 58 years and the exclusion of a class of persons from its benefit. Both the case are therefore plainly distinguishable and are of no assistance to us in solving the problem before us. ", "Another case on which reliance was palced by the learned counsel appearing for the respondents in Writ Petition Nos. 3203, 3413-3419, 3420-3426 etc.etc. Of 1985 was AIR 1965 S.C. 473. In that case a servant who was due to retire from service on and from January 1, 1961, was suspended from service on December 22, 1960, pending a departmental inquiry. His services were extended till March 31, 1961. The departmental inquiry was, however, not concluded even by then. So on May 9, 1961, the passed an order extending his services for a period of 3 months with effect from April 1, 1961. This held that the government had no jurisdiction to extend the service of a servant, after he had retired from service; merely for the purpose of continuing the departmental inquiry. Rule 56 of the Departmental rules did not authorise such a course. It is difficult to see how this case can possibly assist the respondents in Writ Petitions Nos. 3203, 3413-3419, 3420- 3426 etc. etc. Of 1985. It is one thing to say that the has no power to pass an order extending the service of a servant after he has retired from service; it is altogether a different thing to say that the state while making a law raising the age of superannuation cannot make an unreasonable classification to exclude some Servants from the benefit of the increased age of superannuation. The classification must pass the dual test of being reasonable and related to the object of the legislation, besides not being arbitrary. It is not open to the State to make an arbitrary classification first by making the date dependent on an uncertain event namely, the date of pronouncement of judgment by and next by making a legislation excluding persons who had attained the age of 55 years before the legis lation took effect though the legislation itself was designed to undo the wrong already done to the very employees. Some other cases were also cited before us to illustrate the point that it was open to the and the to choose a 'cut-off' date for bringing into force laws such as Land Reform Laws etc. It is true that whenever a law is made or whenever an action is taken, it has to be with effect from a certain date but it does not necessarily follow that the choice of the date of not open to scrutiny at all. If the choice of the date is made burdensome to some of those, the wrong done to whom is sought to be rectified by the law it would certainly be open to the to examine the choice of the date to find out wether it has resulted in any discrimination. ", "We think that the one case which is really of assistance to us in this matter is the recent decision of in 2 SCR 165. We propose not merely to quote extensively from 's case, not merely to adopt the principles therein laid down but also to employ the very techniques applied there to solve the problem. The question arose there whether, for the purpose of application of the liberalised pension rules, could stipulate March 31, 1979 as the date for dividing Government employees into two classes: one class who had retired before March 31, 1979 who would not be entitled to the benefits of the liberalised pension rules and the other class who retired after March 31, 1979 who would be entitled to such benefits. The submission was that the differential treatment accorded to those who had retired prior to the specified date was voilative of Art. 14 as the choice of the date was arbitrary and the classification based on the fortuitous circumstance of retirement- before or subsequent to the specified date was invalid. This submission was accepted by . Justice speaking for a unanimous , considered the question at great length in all its implications. First considering the scope of Art. 14 , it was observed: ", "\"The decisions clearly lay down that though Art.14 forbids class legislation, it does not forbid reasonable classification for the purpose of legislation. In order, however to pass the test of permissible classification two conditions must be fulfilled, viz. (i) that the classification must he founded on an intelligible differentia which distinguishes persons or things that are grouped together from those that are left out of the group; and (ii) that differentia must have a rational relation to the objects sought to be achieved by the statute in question The other fact of Art.14 which must be remembered is that it eschews arbitrariness in any form. Article 14 has, therefore, not to be held identical with the doctrine of classification. ", "Thereafter the posed the question: \" As a corollary to this well established proposition, the next question is, on whom the burden lies to affirmatively establish the rational principle on which the classification is founded correlated to the object sought to be achieved?\" ", "The question was answered and it was said: \"The , therefore, would have to affirmatively satisfy the that the twin tests have been satisfied. It can only be satisfied if the establishes not only the rational principle on which classification is founded but correlate it to objects the sought to be achieved.\" ", "The submission made by the learned Attorney-General on behalf of was summarised: ", "\"Thus according to the respondents, pensioners who retire from service and are governed by the relevant pension rules all do not form a class but pensioners who retire prior to a certain date and those who retire subsequent to a certain date form distinct and separate classes. It may be made clear that the date of retirement of each individual pensioner is not suggested as a criterion for classification as that would lead to an absurd result, because in that event every pensioner relevant to his date of retirement will form a class unto himself. What is suggested is that when a pension scheme undergoes a revision and is enforced effective from a certain date, the date so specified becomes a sort of rubicon and those who retire prior to that date from one class and those who retire on a subse- ", "607 ", "quent date form a distinct and separate class and no one can cross the Rubicon. ", "The then proceeded to consider the question: what is a pension? and why a liberalised pension schemes? After answering these questions the court referred to some of the very arguments now advanced before us that the date is an integral part of the scheme and so not severable from the scheme at all and that the should not usurp legislative functions. The learned Attorney General's argument on these questions was: ", "\"The Learned Attorney-General contended that the scheme is one whole and that the date is an integral part of the scheme and the Government would have never enforced the scheme devoid of the date and the date is not severable from the scheme as a whole. Contended the learned Attorney-General that the does not take upon itself the function of legislation for persons, things or situations omitted by the legislature. It was said that when the legislature has expressly defined the class with clarify and precision to which the legislation applies, it would be outside the judicial function to enlarge the class and to do so is not to interpret but to legislate which is the forbidden field. Alternatively it was also contended that where a larger class comprising two smaller classes is covered by a legislation of which one part is constitutional, the examines whether the legislation must be incalidated as a whole or only in respect of the unconstitutional part. It was also said that severance always cuts down the scope of legisation but can never enlarge it and in the present case the scheme as it stands would not cover pensioners such as the petitioners and if by severance an attempt is made to include them in the scheme it is not cutting down the class or the scope but enlarge the ambit of the scheme which is impermissible even under the doctrine of severability. In this context it was lastly submitted that there is not a single case in India or elsewhere where the has included some category within the scope of provisions of a law to maintain its constitutionality.\" ", "Proceeding them to meet the submission of the learned Attorney General, said, \"If it appears to be undisputable as it does to us that the pensioners for the purpose of pension benefits form a class would its upward revision permit a homogeneous class to be divided by arbitrarily fixing an eligibility criteria unrelated to purpose of revision and would such classification be founded on some rational principle. The classification has to be based, as is well settled, on some rational principle and the rational principle must have nexus to the objects sought to be achieved. We have set out the objects underlying the payment of pension. If the considered it necessary to liberalise the pension scheme, we find no rational principle behind it for granting these benefits only to those who retired subsequent to that date simultaneously denying the same to those who retired prior to that date. If the liberalisation was considered necessary for augmenting social security in old age to government servants then those who retired earlier cannot be worst off than those who retire later. Therefore, this division which classified pensioners into two classes is not based on any rational principle and if the rational principle is the one of dividing pensioners with a view to giving something more to persons other wise equally placed it would be discriminatory. To illustrate take two persons, one retired just a day prior and another a day just succeeding the specified date. Both were in the same pay bracket the average emolument was the same and both had put in equal number of years of service. How does a fortuitous circumstance of retiring a day earlier or a day later will permit totally unequal treatment in the matter of pension. One retiring a day earlier will have to be subject to ceiling of Rs. 8,100 p.a. and average emolument to be worked out on 36 months' salary while the other will have a ceiling of Rs. 12,000 p.a. and average emolument will be computed on the basis of last ten months average. The Artificial division stares into face and is unrelated to any principle and whatever principle, if there be any, has absolutely no nexus to the objects sought to be achieved by liberalising the pension scheme. In fact this arbitrary division has not only no nexus to the liberalised pension scheme but it is counter productive and runs counter to the whole gamut of pension scheme. The equal treatment guaranteed in Art. 14 is wholly violated inasmuch as the pension rules being statutory in character, since the specified date, the rules accord differential and discriminatory treatment to equals in the matter of commutation of pension. A 48 hours difference in matter of retirement would have a traumatic effect. Division is thus both arbitrary and unprincipled. Therefore the classification does not stand the test of Art. 14.\" ", "The then asked itself the question: By our approach, are we making the scheme retroactive. The answer was an emphatic 'No'. They said, \"In other words, benefit of revised scale is not limited to those who enter service subsequent to the date fixed for introducing revised scales but the benefit is extended to all those in service prior to that date. This is just and fair. Now if pension as we view it, is some kind of retirement wages for past service, can it be denied to those who retired earlier, revised retirement benefits being available to future retires only. Therefore, there is no substance in the contention that the court by its approach would be making the scheme retroactive, because it is implicit in theory of wages. ", "The C finally considered the favourite argument advanced against what some of the Counsel who appeared before us described as judical 'tinkering' with legislative policy. The C took the view that the cannot say 'Take it or leave it'. If there are words in a statute which bring about discrimination, those words can be severed. They said, \"There is nothing inmutable about the choosing of an event as an eligibility criteria subsequent to a specified date. If the event is certain but its occurrence at a point of time is considered wholly irrelevant and arbitrarily selected having no rationale for selecting it and having an undesirable effect of dividing homogeneous class and of introducing the discrimination, the same can be easily severed and set aside. While examining the case under Art. 14 , the approach is not : 'either take it or leave it', the approach is removal of arbitrariness and if that can be brought about by severing the mischievous portion the ought to remove the discriminatory part retaining the beneficial portion. The pensioners do not challenge the liberalised pension scheme. They seek the benefit of it. Their grievance is of the denial to them of the same by arbitrary introduction of words of limitation and we find no difficulty in severing and quashing the same. This approach can be legitimised on the ground that every servant retires. grants upward revision of pension undoubtedly from a date. Event has occured revision has been earned. Date is merely to avoid payment of arrears which may impose a heavy burden. If the date is wholly removed, revised pensions will have to be paid from the actual date of - retirement of each pensioner. That is impermissible. The cannot be burdened with arrears commencing from the date of retirement of each pensioner. But effective from the specified date future pension of earlier retired servants can be computed and paid on the analogy of fitments in revised pay-scales becoming prospectively operative. That removes the nefarious unconstitutional part and retains the beneficial portion. It does not adversely affect future pensioners and their presence in the petitions becomes irrelevant. out before we do so, we must look into the reasons assigned for eligibility criteria, namely, 'in service on the specified date and retiring after that date'.\" The learned judges then expressed their disinclination to share the fear expressed by the learned Attorney, General that the would not have enacted the measure if the unconstitutional part was struck down and added \"Our approach may have a parliamentary flavour to sensitive noses. Dealing with the question of frame of relief, the C struck down as unconstitutional the words, that in respect of the servants who were in service on the 31st March, 1979 and retiring from service on or after that date and the words the new rates of pension are effective from 1st April, 1979 and will be applicable to all service officers who became/become non-effective on or after that date in the impugned memoranda, but specified that the date mentioned therein will be relevant as being one from which the liberalised pension scheme becomes operative to all pensioners governed by 1972 Rules irrespective of the date of retirement.\" ", "611 ", "It was declared all pensioners governed by the 1972 Rules and Army Pension Regulations shall be entitled to pension as computed under the liberalised pension scheme from the specified date, irrespective or the date of retirement.\" ", "In the course of our narration, we have already stated our conclusions on several of the questions at issue, both factual and legal. The final situation that emerges is that almost immediately after the age of superannuation was reduced from 58 to 55 years, it was realised by that they had taken a step in the wrong direction and that serious wrong and grave injustice had been done to their employees. A decision was very soon taken to redress the wrong by reversing the decision but an unfortunate rider was added that they should wait till the pronouncement of the judgment of , which was perhaps expected to be pronounced shortly. As the judgment was not pronounced for long, it became imperative for the to implement their decision of their own accord and so they passed Ordinance No. 24 of 1984 and Act No. 3 of 1985, amending Act No. 23 of 1984 by substituting 58 years for 55 years. While doing 80, unfortunately again, those that had suffered must by being compelled to retire between 28.2.83 and 23.8.84 were denied the benefit of the legislation by cl.3(1) of the Ordinance and Sec. 4(1) of Act No.3 of 1985. Now if all effected employees hit by the reduction of the age of superannuation formed a class and no sooner than the age of superannuation was reduced, it was realised that injustice had been done and it was decided that steps should be taken to undo what had been done, there was no reason to pick up out a class of persons who deserved the same treatment and exclude from the benefits of the beneficent treatment by classifying them as a separate group merely because of the delay in taking the remedial action already decided upon. We do not doubt that the Judge's friend and counsellor, 'the common man', if asked, will unhesitatingly respond that it would be plainly unfair to make any such classification. The common sense response that may be expected from the common man, untramelled by legal lore and learning, should always help the judge in deciding questions of fairness, arbitrariness etc. Viewed from whatever angle, to our minds, the action of the and the provisions of the legislation were plainly arbitrary and discriminatory. The principle of Nakara clearly applies. The diversion of employees into two classes, those who had already attained the age of 55 on 28.2.83 and those who attained the age of 55 on 28.2.83 and 23.8.84 on the one hand, and the rest on the other and denying the benefit of the higher age of superannuation to the former class is as arbitrary as the division of employees entitled to pension in the past and in the future into two classes, that is, those that had retired prior to a specified date and those that retired or would retire after the specified date and confining the benefits of the new pension rules to the latter class only. Legislations to remedy wrongs ought not to exclude from their purview persons a few of the wronged persons unless the situation and the circumstances make the redressal of the wrong, in their case, either impossible or so detrimental to the public interest that the mischief of the remedy outweighs the mischief sought to be remedied. We do not find that there is any such impossibility or detriment to the public interest involved in reinducting into service those who had retired as a consequence of the legislation which was since thought to be inequitable and sought to be remedied. As observed in Nakara, the burden of establishing the reasonableness of a classification and its nexus with the object of the legislation is on the . Though no calamitous consequences were mentioned in any of the counter affidavits, one of the submissions strenuously urged before us by the learned Advocate-General of Andhra Pradesh and the several other counsel who followed him was the oft-repeated and now familiar argument of 'administrative chaos'. It was said that there would be considerable chaos in the administration if those who had already retired are now directed to be reinducted into service. ", "We are afraid we are unable to agree with this submission. Those that have stirred-up a hornet's nest cannot complain of being stung. The argument about administrative chaos has been well met by Lord Denning M.R. in Bredburry & Ors. v. London Borough of Enfield [1957] 3 All E.R. 434, where the Master of Rolls in his characteristic and forceful way observed: ", "\"It has been suggested by the Chief education officer that, if an injunction is granted, chaos will supervene. All the arrangements have been made for the next term, the teachers appointed to the new comprehensive schools, the pupils allotted their places, and 80 forth. It would be next to impossible, he says, to reverse all these arrangements without complete chaos and demage to teachers, pupils and public. I must say this: if a local authority does not fulfil the requirements of the law, this court will see that it does fulfil them. It will not listen readily to suggestions Of chaos . The department of education and the council are subject to the rule of law and must comply with it, just like everyone else. Even if chaos should result, still the law must be obeyed; but I do not think that chaos will result. The evidence convinces me that the chaos\" is much over-stated.................. I see no reason why the position should not be restored, so that the eight schools retain their previous character until the statutory requirements are fulfilled. I can well see that there may be a considerable upset for a number of people, but I think it far more important to unphold the rule of law. has laid down these requirements so as to ensure that the electors can make their objections and have them properly considered. We must see that their rights are upheld.\" ", "In the present case too, we think that the case of chaos is much overstated. The affidavits do not disclose what disastrous consequences, insoluble problems and unsurmountable difficulties will follow and how chaos will inevitably result. True quite a large number of employees who have been promoted will have to be reverted, but their promotions and promotional - appointments are all temporary (and, we take care to add here it would make no difference even if a few were regularly promoted) and it is not e as if they lose for ever their promotional opportunities. The promotional opportunities are merely postponed to the dates on which they would be entitled to be promoted had not the fundamental rules and the Hyderabad Civil Services, Rules been amended and Act No. 23 of 1984 passed. What has now happened 18 that these persons have secured a double advantage. First, by the initial reduction of the age of superannuation, they obtain- ed early and unanticipated promotion, that is to say, promotion ahead of the normal date on which they would have otherwise been promoted; and second their tenure in the promoted post was increased by a further three years as a result of the subsequent increase of the age of superannuation. Having secured this double advantage they naturally desire to stick to them and talk glibly of hardship and inconvenience. On the other hand, it would be a great injustice to deny justice to those who have suffered injustice must merely because it may cause inconvenience to the administration. We are governed by the Constitution and constitutional rights have to be upheld. Surely the Constitution must take precedence over convenience and a judge may not turn a bureaucrat. We do not mean to suggest that creation of a chaotic State of administration is not a circumstance to be taken into account. It may be possible that in a given set of circumstances, portentous administrative complexity may itself justify a classification. But, there must be sufficient evidence of that - how the circumstances will lead to chaos. Ups and downs of career bureaucrats do not by themselves justify such a classification. It may however be of some consequence in the matter of granting relief. For instance there would be really no point in reinducting an employee if he has but a nth or two to go to attain the age of 58 years and to retire. Reinduction of such a person is not likely to be of any use to the administration and may indeed be detrimental to the public interest. It is bound to be wasteful. In such cases as well as in cases where they can't be reinducted because they have already completed 58 years by now, they cannot obviously be reinducted. So other ways of compensating them must be found. The obvious course is to compensate them monetarily. In Industrial Law we do award back and future wages on quite a large scale and there is no reason why we cannot adopt the same principle here. If as a rule private employers in such situations are asked to pay backwages, we see no impediment in doing 80 in the case of those that are expected to be model employers i.e. the , public corporations and local authorities. ", "An argument which requires to be dealt with is that it is not open to the to give retrospectively to a legislation to which the legislature plainly and expressly refused to give retrospectivity. As pointed out in 's case. the question is not one of retrospectivity at all. The circumstances that the relief given by Ordinance No.24 of 84 and Act No.3 of 1985 is not extended to those who had attained the age of 55 years by February 28, 1983 or between 28.2.83 and 23.8.84, has the effect of limiting the field of operation of the Ordinance and the Act and introducing a classification which in order to be sustained must be shown to be reasonable and to have a nexus to the object to be achieved besides not being arbitrary. While it is a general rule of law that statutes are not to operate retrospectively, they may 80 operate by express enactment, by necessary implication from the language implied or where the statute is explanatory or declaratory or where the statute is passed for the purpose of protecting the public against some evil or abuse or where the statute engrafts itself upon existing situations etc. etc. But it would be incorrect to call a statute 'retrospective', \"because a part of the requisites for its action is drawn from a time antecedent to its passing . (Vide R.V. St. Mary, Whitechape1 (Inhabitants) [1842] 12 Q.B. 120). We must further remember, quite apart from any question of retrospectivity, that, unlike in the United Kingdom here in India we have a written Constitution which confers justificiable fundamental rights and so the very refusal to make an Act retrospective or the non-application of the Act with reference to a date or to an event that took place before the enactment may, by itself, create an impermissible classification justifying the striking down of the non-retroactivity or non-application clause, as offending the fundamental right to equality before the law and the equal protection of the laws. That is the situation that we have here. ", "We may now refer to two arguments which were mentioned in passing but were not pursued. The first was that a writ petition similar to Writ Petition Nos. 3420-3426/83 etc. had been filed earlier and had been dismissed in limine by a Bench of this Court. We do not see how the dismissal in limine of such a writ petition can possibly bar the present writ petitions. Such a dismissal in limine may inhibit our discretion but not our jurisdiction. So the objection such as it was, was not pursued further. So also the second objection which related to the nonjoinder of all affected parties to the litigation. We are quite satisfied that even if some individual affected parties have not been impleaded before us, their interests are identical with those and, have been sufficiently and well represented. Further, the relief claimed in Writ petition Nos. 3420-3426 of 1983 etc. is of a general nature and claimed against the and no particular relief is claimed against any individual party. We do not think that the more failure to impead all affected parties is a bar to the maintainability of the present petitions in the special circumstances of these cases where the actions are really between two 'warning groups'. ", "Finally we come to the question of the relief to be granted. We find that C1.3(1) of Ordinance No.24 of 84 and Sec.4 (1) of Act No. 3 of 1985 may easily be brought to conform to the requirements of Art. 14 of the Constitution by striking down or omitting the naughty word 'not' from those provisions. We may possibly achieve the same object by striking down the whole of c1.3(1) of the Ordinance and Sec.4(1) of the Act but then the question may arise whether the rest of the Act would be sufficient to bring in these who have been excluded. We think that the safer course would be to strike down the offending word 'not' from these provisions. That we have such power is clearly laid down in 's case where the court directed the deletion of some words from the offending clause and directed it to be read without those words. To make matters clear and to put them beyond dispute, we give the following directions in exercise of our powers under Art. 32 and 142 of the Constitution: ", "\"1. All employees of the , public corporations and local authorities, who were retired from service on the ground that they had attained the age of 55 years by 28.2.85 or between 28.2.83 and 23.8.84, shall be reinstated in service provided they would not be completing the age of 58 years on or before 31.10.1985. ", "2. All employees who were compelled to retire on February 28, 1983 and between February 28, 1983 and August 23, 1984 and who are not eligible for reinstatement under the first clause, shall be entitled to be paid compensation equal to the total emoluments which they would have received, had they been in ser vice, until they attained the age of 58 years, less any amount they might have received ex-gratia or by way of pension etc. Or under the Interim orders of this Court. They will be entitled to consequential retiral benefits. ", "3. Such of the employees as have not been compelled to retire by virtue of orders of stay obtained from or , or who have actually been reinstated in service pursuant to interim orders of this , shall be allowed to continue in service until they attain the higher age of superannuation. ", "4. The reinduction of those employees that have been compelled to retire previously will put them back as regards their seniority in precisely the same position which they occupied before they were retired from service. They will be entitled to all further consequential benefits. ", "5. The employees who were retired and who are reinducted will be entitled to be compensated for the period during which they were out of service in the same manner as mentioned in clause (2). ", "617 ", "6. In the matter of reinduction of employees who do not attain the age of 58 years on or before 31st October, 1985 the Government may exercise an option not to reinduct them in the case of all or some or any of the employees, as the case may be, provided the employees are paid the compensation as in the case of those covered by (2) and (5). ", "7. All interim orders are vacated and subject to these directions, the Government is free to revert persons promoted or appointed to the posts held by persons who were retired on having attained the age of 55 years by 28.2.1983 or between 28.2.83 and 23.8.84 to the posts which they held on February 29, 1983 or on the dates previous to their promotion or appointment provided that they need not be so reverted, if they would otherwise be entitled to be promoted or appointed even if the other employees had not been retired consequent on the lowering of the age of superannuation. ", "8. The Government shall be free to create supernumerary posts wherever they consider it necessary so to do. ", "9. All payment of compensation to be made and completed before December 31, 1985. If for any reason the Government finds itself unable to pay the entire amount at one time within the time fixed by us, the Government will be at liberty to pay the amount in not more than four instalments within the time stipulated by us. The Government will also have the liberty to supply to us for extension of time, if so advised. Where the employees are awarded compensation by the Government, such employees may apply to the concerned Income-tax Officer for relief under Section 89 of the Income-tax Act read with Rule 21-A of the Income-tax Rules and Income-tax Officer concerned will grant the appropriate relief.\" ", "With these directions, Writ Petitions Nos. 3420-26 of 1985 etc. are allowed with costs and Writ Petitions Nos. 5447-5546 of 1985 etc. are dismissed but in the special circumstances without any order as to costs. ", "618 ", ", While respectfully agreeing with the judgment prepared by my learned Brother , I have thought it fit to add a few words of my own since I consider it necessary to make it absolutely clear that the conclusions reached by us in these cases are based entirely on the special facts and circumstances constituting the legislative history of the impugned Andhra Pradesh Ordinance No.24 of 1984 and Act 3 of 1985 which have been set out in extenso in the judgment of , ", "We are not to be understood as laying down that whenever the age of superannuation of employees or of employees of local authorities etc. is enhanced, the benefit of such enhancement should be extended not merely to persons in service on the date on which the change is effected but also to persons who have already retired from service prior to that date. It is now well established by decisions of this Court that the has full power to effect a change in the age of superannuation of its employees on relevant considerations. If in the exercise of such power the age of superannuation is enhanced purely by way of implementation of a policy decision taken by the , such alteration can legally be brought about with prospective effect from the date of the commencement of the operation of the Ordinance, Act or Rule and no question of violation of Article 14 or 16 of the Constitution will arise merely because the benefit of change is not extended to employees who have already retired from service. In these cases now before us our conclusion is rested entirely on the finding arrived at by us after a consideration of the factual background and legislative history of the impugned Ordinance and Act that the underlying purpose and object behind the relevant provisions of the Ordinance and the Act was to set right and nullify a wrong or injustice that had been done to the employees by the abrupt reduction of the age of superannuation from 58 years to 55 years by Ordinance No. 8 of 1983 and the 's Notification issued as per G.O. Ms.No.36, dated 8th February, 1983 which preceded it. All that we are holding is that in the context of these telling facts and circumstances which conclusively show that the object and purpose of the Legislation was to set right the injustice that had been done, there is no rational or reasonable nexus or basis for separately classifying the employees who had retired from service prior to the date of commencement of Ordinance No.23 of 1984, who are the persons most affected by the wrong - by denying to them the benefit of the rectification of the injustice. It is solely on this ground that we are allowing these Writ Petitions and granting the reliefs specified in the judgment of ", "619 ", "KHALID, J. After considering the rival contentions put forward by the learned counsel on both sides, the factual matrix and the law involved, the following points gave me some difficulty in accepting the petitioners' case. I felt that these points posed hurdles in the way of the petitioners succeeding in their attempt to secure the relief sought. I am formulating the points as I understood them. ", "1. This Court in . A.I.R. S.C. 551, upheld the action of the in reducing the age of retirement from 58 to 55. The contention that such reduction was arbitrary and irrational was not accepted. Further, the contention that the age of superannuation was increased from 55 to 58 years with effect from October 29, 1979, after an elaborate and scientific enquiry by an one-man pay commission did not find favour with this Court because it felt that the question of The age of retirement was not referred to the . Accordingly the Court held that the decision regarding the age of retirement was a matter of policy in the formulation of which the must be allowed a free and fair role to play. It is not always necessary that such a decision is taken on the basis of empirical data collected on scientific investigation. The further submission that the decision to reduce the age of retirement from 58 to 55 years was arbitrary in view of the fact that it was taken by the State within one month of the assumption of office by it also did not find favour with this Court. This Court observed that the reasonableness of a decision in any jurisdiction, did not depend upon the time which it took. This decision has became final and the petitioners before us cannot in any manner question it. This decision is, therefore, an authority for the proposition that the charge of arbitrariness cannot be laid at F the doors of the in matters relating to policy decisions and that the have full powers to decide about the age of retirement considering the various data available before it. ", "(2) v. State of U.P. & others, [1965] 1 S.C.R. 693, is a decision rendered by a Constitution Bench of this Court. In that case, a notification on November 27, 1957, raised the age of superannuation from 55 to 58 years. On May 25, 1961, the age of retirement was reduced once-again to 55 years. It was provided in the second notification that those who were retained in service beyond the age of superannuation on the basis of the earlier notification would be compulsorily retired on December 31, 1961. The second notification was questioned as being arbitrary and hit by Article 14 since it resulted in inequality between the public servants in the matter of retirement. In this Judgment the classification of employees who were in service into two groups based on their age was upheld by as a reasonable classification. I felt that this case had a great bearing on the petitions before us and the principle laid down there could be extended to the cases before us. It was strongly contended that if classification of two groups of in-service employees on the basis of age and a cut off date could be justified as reasonable classification, it can be more so in cases like the one before us where the classification is between the retired employees and those in service. ", "(3) By the operation of a valid law, some employees have retired by superannuation and have thus ceased to be members of their respective service. What is now attempted is to retrospectively re-induct them into service, a procedure that should frown upon and not encourage. ", "(4) For the purpose of the cases before us, case is more appropriate and useful than that of , 2 S.C.R. 165, which dealt with two classes of retired employees and a cut off date. The attempt to distinguish case on the factual difference avail able in these cases is a matter for further probe, in order to see how for the distinction is destructive of the principle laid down there in its application to these cases. ", "(5) The original attempt by the petitioners was to get Section 3 of the amending Act struck down in its entirety. Now they realise that such a relief would not serve their purpose. What they now want is that this Court should remove the word 'not' from the Section, so that the petitioners will be rescued from the mischief of that word. Removing a word or adding words to a legislative enactment is an exercise, Courts have been repeatedly warned against from embanking upon. I personally feel that this guideline is one that has to be respected by Courts of law. ", "(6) A petition, similar to one before us, was filed in this as W.P. No. 16080/1984 raising identical points. This writ petition came up for hearing on 12.2.1985 before a Bench consisting of the Chief Justice, Justice and Justice After hearing the counsel for the petitioner as well as the of Andhra Pradesh, the Bench suggested that the counsel for the should take instructions from the of Andhra Pradesh about reinstating in service of those persons who had not attained 58 years of age, but without back-wages. The case was adjourned to 19.2.1985 for that purpose. I understand that counter-affidavits were also filled in that case. The case appeared before a Bench consisting of Justice and Justice on the next occasion. On that occasion, the petition was dismissed, after hearing. Normally this will be disinclined to entertain or to hear petitions raising identical points again where on an earlier occasion, the matter was heard and dismissed. Not that this has no jurisdiction to entertain such matters, but would normally exercise its discretion against it. One of the counsel appearing for the respondents strongly pleaded the bar of against these petitions on the basis of the earlier decision. ", "(7) The learned Advocate General of the Andhra Pradesh with great concern and justifiably appealed to US that if the petitions were allowed, lt would cause serious dislocation in the administration. He strongly pleaded that the action taken did not have any tinge of mala fides that there was no attempt at picking and choosing of any Government servant and that therefore the Court should not exercise its jurisdiction to annul a policy decision. ", "2. I have given my anxious considerations to the above questions and the rival submissions in reply. I find that the case is more or less evenly balanced between the parties. The important factors have, however, persuaded me, to agree with the main Judgment and to err on the side of Justice more than that of law, invoking the benevolent jurisdiction under Article 142(1) of the Constitution of India which reads: ", "\"142(1) in the exercise of its jurisdiction may pass such decree or make such order as is necessary for doing complete justice in any cause or matter pending before it, and any decree 80 passed or order 80 made shall be enforceable through out the territory of India in such manner as may be prescribed by or under any law made by and, until provision In that behalf is so made, in such manner as the President may by order prescribe. ", "These petitions involve a serious human problem. ", "Employees of the with limited resources, who have been planning their future with a secure feeling that they could work till the age of 58 years, have as though overnight, been robbed of their tenure, their aspirations and future. They have become the helpless victims of certain swift moves on the political chess board. These swift moves, perhaps taken in a hurry, without serious application of mind have resulted in arbitrariness that has been forcefully projected by the petitioners. This plea cannot be light heartedly thrown overboard. Justice demands that the petitioners should be saved of their predicament. ", "The second factor that has prevailed upon me to give succour to the petitioners is the blame that this has to share for the sorry state that has come to pass in the matter. Without meaning disrespect to anyone, I firmly believe, that prompt action by the , would have eased the situation, considerably and relieved the petitioners of their sad plight and us of this avoidable exercise. It is not as though that the subsequent developments were not brought to the notice of this in 's case, (supra). We were told that the Bench was alerted in time about the developments that had taken place but unfortunately they were not taken into account. When the Judgment ultimately came on 18.1.1985, as many as 6000 employees had lost their service, a tragic result, not based on any relevant consideration having a nexus to the age of superannuation. The damage had been done and it can be repaired only by extending this 's powers to a section of employees who deserves sympathy and fair deal. ", "This short Judgment is only to vindicate my stand. I respectfully agree with the Judgment prepared by my learned brother , I am also in entire agreement with my learned brother , about the limited scope of the principles laid down in these cases on their peculiar facts. ", " dismissed."], "relevant_candidates": ["0000018076", "0000463334", "0001416283"]} {"id": "0001069818", "text": [", J. ", "1. This revision is by the defendant in O.S. No. 278 of 1994, on the file of District 's , Tindivanam. ", "2. The suit filed by the respondents herein as plaintiffs is one for permanent injunction restraining the defendant, petitioner herein, from interfering with the plaintiffs' peaceful possession and enjoyment of the suit properties either by themselves or by their representatives or successors-intitle or by anyone claiming through him till 19.10.2002; for costs of suit; and for other reliefs. ", "3. Along with the suit, the plaintiffs filed I.A. No. 1004 of 1994 for an interim injunction. The material averments in the affidavit filed in support of the said petition are, that the first plaintiff is a private limited company incorporated under Companies Act 1956. Its Certificate of Incorporation is No. 18-17521 of 1989, on the file of , Tamil Nadu, and the same was registered on 9.6.1989. The main objects to be pursued by the plaintiffs are said to be many, and, according to the plaintiffs, the foremost object was to have quarry operations by acquiring lights over lands which contain deposits of granite. The business of the company is buying, selling and exporting granites by quarrying the same. It is said that the defendant is the absolute owner of the suit properties, and he approached the plaintiffs with an offer of lease for the purposes of exploiting those lands. Pursuant to the same, exploitation rights have been given to the first plaintiff-company represented by the second plaintiff in respect of the suit lands by duly executed document dated 20.10.1992. By the said arrangement, the plaintiffs are entitled to exploit granite deposits in the suit lands for a period often years from 20.10.1992, with an option to renew the same. An advance of Rs. 7 lakhs was paid and the same is identified in the document dated 20.10.1992 also. In view of the exploitation of the deposits by the plaintiffs, Rs. 10,000 per cubic metre has to be paid to the defendant whenever granite is quarried by 1st plaintiff. It is said that possession of the suit lands was also vested with the plaintiffs by the arrangement dated 20.10.1992, and the plaintiffs took possession of the lands and commenced several activities of quarrying the suit lands. It is said that the plaintiffs, respondents herein, by exploiting the quarry have further settled by way of supply of granite worth Rs. 4,90,000 to one , Madras to whom the defendant, through his proprietory concern, had financial commitments to pay the same. It is also said that the defendant received from plaintiffs Rs. 20 lakhs. It is further said that subsequent to taking possession, the plaintiffs had their overseas commitments, and the contract of purchase has been entered into with foreign buyers for the export of black granite from suit lands. It is stated that the documents produced along with the plaint will show that the plaintiff has acted on the agreement. It is said that the respondents (plaintiffs) have also paid sales-tax to the and statutory authorities for movement of blocks from the quarry to the Harbour. The petitioner also gave Letters of Authority to plaintiffs under his trade concern name ' of which he is the proprietor, authorising the plaintiffs to act and represent the defendant before public authorities as well as in respect of various activities concerning the exploitation of granites by plaintiffs, respondents herein. It is said that persons inimically disposed towards the plaintiffs, have approached the defendant to act contrary to the trade interest of the plaintiffs, and, as a result of that, the defendant, petitioner herein, has completely changed his attitude and is creating various disturbances to the plaintiffs in the smooth exploitation of suit lands. It is further stated that the petitioner herein has started acting against the interest of the respondents herein from 11.4.1994 by joining hands with trade competitors, contrary to the written commitments made by him. As per arrangement dated 20.10.1992, the respondents herein are entitled to exploit the deposits till 19.10.2002. The respondents, apprehending dispossession by force at the hands of the petitioner herein, filed the injunction petition. ", "4. A counter-affidavit has been filed by the petitioner herein (defendant) wherein he dispute the rights of the plaintiffs to get an injunction. It is said that a document was executed on 20.10.1992, but the same was only for the purpose of getting a loan from , and it was never intended to take effect. It is not an enforceable contract. It is also said that there was no necessity or occasion to give possession of the suit lands to the respondents. The petitioner herein asserts that he continues to be in possession, and he is doing business in granites. It is further averred that the statement that he has received a sum of Rs. 7,00,000 on the date of the agreement by way of advance, is also not correct. The petitioner also denies the allegation by the respondents that they have supplied granites to various countries and that they have settled transaction with . The receipt of nearly Rs. 20 lakhs is also disputed by the petitioner. It is also said that all the documents produced along with the plaint will show that only the defendant is in possession of the suit lands. According to the petitioner herein, the documents do not reveal that he (defendant) has authorised the plaintiffs (respondents herein) to represent him before the Collector and other officials. According to the petitioner, he is still in possession of the suit properties. He disputes the pecuniary jurisdiction of this Court and also the maintainability of the suit as it stands. According to the petitioner herein, the respondents (plaintiffs) have no prima facie case and, therefore, injunction should not be granted. ", "5. An additional counter-affidavit has also been filed by the defendant, stating that the document dated 20.10.1992 which is the basis of the suit, cannot be enforced in a Court of Law, since it is an unregistered document. According to the defendant, the plaintiffs are not entitled to rely on that document for any purpose. It is also said that under Section 23 of the Contract Act, the court is not competent to take into consideration the terms of the agreement. It is said that it violates the provisions of Rule 33 of Tamil Nadu Minor Mineral Concession Rules, 1959. ", "6. The trial court, as per order dated 17.8.1994, dismissed the injunction application. ", "7. The trial court was of the view that the respondents have not proved a prima facie case, and the balance of convenience is also in favour of the petitioner herein. The trial court also took the view that the agreement cannot be enforced since it is opposed to the statutory provisions under Tamil Nadu Minor Mineral Concession Rules. Finally, it has also stated that there is a contractual liability, and, even if the plaintiffs are put to any loss, the same can be compensated in damages. It has also said that the very execution of the document is against statutory provisions. Taking the above view, the trial court dismissed the injunction application. ", "8. The respondents (plaintiffs) filed C.M.A. No. 161 of 1994. The defendant (petitioner herein) who was the respondent in the said appeal, filed C.M.P. No. 34 of 1995 in that appeal seeking permission to adduce additional evidence. ", "9. The lower appellate court, as per judgment dated 15.9.1995, allowed the appeal and granted an order of injunction. The lower appellate court was of the view that the agreement dated 20.10.1992 is a lawful agreement whereby possession had passed, and the suit which is only for injunction, in the opinion of the learned appellate Judge, can be maintained. The learned Judge was also of the view that the agreement in question does not violate the provisions of Tamil Nadu Minor Mineral Concession Rules, and that the same is not void. The learned appellate Judge was also of the view that Rule 23 of the Tamil Nadu Minor and Mineral Concession Rules enables registered holder and lessee to jointly work the mines, and, when the respondent (defendant) had permitted the plaintiffs to represent him before the authorities, on that basis, the plaintiffs can take the licence and work in the quarry. The lower appellate court said that till a licence is obtained, the contract cannot be enforced against the Government. As between the parties to the agreement, the agreement was held to be valid. It prima facie took the view that possession was handed over to the plaintiffs and the defendant had also received amounts in consideration of the same. On the above view, it held that the plaintiffs have proved a prima facie case, and accordingly granted temporary injunction till the disposal of the suit. ", "10. It is against the said judgment of the lower appellate court, this revision is filed. ", "11. Learned Senior Counsel for the petitioner put forward a contention that the agreement dated 20.10.1992 cannot be considered for any purpose, and the finding rendered by the lower appellate court regarding possession is against the materials placed before court. Learned Senior Counsel also argued that the document dated 20.10.1992 cannot be enforced in , since the same is not registered. He further argued that if the agreement dated 20.10. 1992 is enforced, the same will be against Section 23 of the Contract Act and also against public policy. He also argued that when the trial court has exercised its discretion in refusing injunction, the lower appellate court, under normal circumstances, should not reverse the same, unless patent illegality is shown in such exercise of discretion by the trial court. Learned Senior Counsel also argued that since the suit is based on a contract, injunction suit is not the proper remedy, and the suit should have been one for specific performance of the agreement. It is also said that injunction should not have been granted under Section 41 of the Specific Relief Act. Learned Senior Counsel also attacked the judgment of the lower appellate court on the ground that it has not considered the aspects of balance of convenience and irreparable loss or injury, which are the necessary ingredients that have to be considered before granting injunction. ", "12. According to the learned Senior Counsel for the respondents (plaintiffs), this being a revision, this may not interfere with the conclusion reached by the lower appellate court. He wanted the revision to be dismissed with costs of the respondents. ", "13. As stated earlier, the only one point that has to be considered in this revision is, whether the judgment of the lower appellate court is liable to be interfered with, in exercise of revisional jurisdiction. ", "14. The document executed between the petitioner and the respondents herein is marked for reference as Ex. P-28. It is in Tamil. Even at the time when the document was produced in court, an objection was taken by the petitioner herein that the same cannot be admitted in evidence, since it is not properly stamped, nor registered. The trial court permitted the marking of the document subject to payment of stamp duty, finding that there is an agreement. The question whether the document requires registration or not, and whether the same can be considered for any collateral purpose, was not considered by the trial court. ", "15. I will first deal with the nature of the document executed between the parties, for, that creates a legal relationship which is sought to be enforced through court. It says that the properties which are described in the Schedule belong to the second executant, and since they are covered by rocks, they could not be cultivated by him. It further says that in the properties described, black granites are situated, and the first executant may excavate the black granites, cut them and make use of the same, either for himself or for the purpose of his business. It is further said that for the said purpose of enabling the first party to excavate granites from the property, the document is executed. Further down, it is said that the period of agreement will be initially for ten years, and, on the expiry of the ten years, the first executant will have right of renewal. Still further down, it is said that the first executant may take possession of the property, excavate the granites, and in consideration of the same, Rs. 7 lakhs have been paid. It further says that for every one sq. metre of excavated granites, the first executant shall pay Rs. 10,000 to the second executant. On receipt of the amount, the second executant shall permit the first executant to remove the excavated granites through the passage mentioned in the document, either through motor vehicles or by coolies. It says that on the basis of the said document, the first executant was being put in possession of the properties. It also says that the first party is bound to see that no damage is caused to the property of the second party. It also says that the first executant may move the for getting necessary licence, for which the second party has signed and authorised the first party to do so. It is seen that a letter of authorisation has also been given by the petitioner herein authorising the respondents (plaintiffs) to appear on his behalf for the purpose of obtaining mining lease in respect of the properties in question, from the authorities concerned. On 10.9.1993, another letter of authorisation has been given by the petitioner authorising the second plaintiff (second respondent) to appear on behalf of the petitioner before the Collector, in the matter of quarrying operations in the property in question. ", "16. The case that is put forward by the respondents herein is that on the basis of Ex. P-28 agreement between the parties, possession passed to them, and, therefore, they are entitled to continue in possession for the entire term of ten years, and the defendant (petitioner herein) should be restrained from interfering with their possession. ", "17. In the plaint, the respondents have only stated that Ex. P-28 is an arrangement whereby they are entitled to exploit the granite deposits from the suit lands and that they are entitled to be in possession till 19.10.2002. What is the impact of the said document is the first question to be considered. ", "18. Learned Senior Counsel for the respondents, relying on the decision reported in . , argued that the transaction between the parties is a lease, and the possession handed over as per the said document amounts to a transfer of land, given for enjoyment. Learned Counsel relied on paragraphs 29 to 35 of the judgment of (cited) and wanted this Court to hold that the said document is a lease, and that a mining lease need not be in strict compliance with a 'lease' as defined under the Transfer of Property Act . Paragraphs 29 to 35 of the judgment of read thus: ", "It is important to bear in mind that the term \"lease\" occurring in the definition of \"mining lease\" given in Section 3(c) of Act 67 of 1957 does not appear to have been used in the narrow technical sense in which it is defined in Section 105 of the Transfer of Property Act. But, as rightly pointed out by a Bench of in A.I.R. 1932 Cal. 775 : I.L.R. 59 Cal. 1314, a settlement of the character of a mining lease is everywhere in India regarded as 'lease'. A mining lease, therefore, may not meticulously and strictly satisfy in all cases, all the characteristics of a 'lease' as defined in the Transfer of Property Act . Nevertheless, in the legally accepted sense, it has always been regarded as a lease in this Country. A.I.R. 1932 Cal. 775 : I.L.R. 59 Cal. 1314, Mukerji, J., speaking for the Bench, held that a coal mining settlement may be regarded as satisfying the requirements of Section 105 and treated as a lease because under such settlement some portion, however small, of the surface has to be used for carrying on the mining operation and taking the coal out. ", "Be that as it may, in the instant case, as shall be presently discussed, the transaction evidenced by Ex. I, not only falls within the definition of a \"mining lease\" under Act 67 of 1957, but also partakes of all the essential characteristics of a 'lease' defined in Section 105 of the Transfer of Property Act. ", "Section 105 , Transfer of Property Act , defines a 'lease' of immovable property as- ", "a transfer of a right to enjoy such property, made for a certain time, express or implied, or in perpetuity, in consideration of a price paid or promised, or of money, a share of crops, service or any other thing of value, to be rendered periodically or on specified occasions to the transferor by the transferee, who accepts the transfer on such terms. ", "In the second paragraph of the section, it is expressly stated that the price so paid in consideration of the transfer is called \"the premium, and the money, share, service, or other thing to be so rendered, is called the rent\" The definition of \"immovable property\" given in Section 3 , para. 1 of that Act is in the negative, and is not exhaustive. Therefore, the definition given in Section 3(26) of the General Clauses Act (X of 1987) will apply to the expression used in this Act, except as modified by the definition in the first clause of Section 3 . According to the definition given in of the General Clauses Act, \"immovable property\" shall include land, benefits to arise out of land, and things attached to the earth, or permanently fastened to anything attached to the earth\". In short, the expression 'immovable property' comprehends all that would be real property according to English Law and possibly more See (1873) 1 I.A. 34 (P.C.). Thus, every interest in immovable property, or a benefit arising out of land, will be \"immovable property\" for the purpose of Section 105 , Transfer of Property Act . ", "A right to carry on mining operations in land to extract a specified mineral and to remove and appropriate that mineral, is a 'right to enjoy immovable property' within the meaning of Section 105 ; more so, when as in the instant case it is coupled with a right to be in its exclusive has possession for a specified period. The 'right to enjoy immovable property' spoken of in Section 105 , means the right to enjoy the property in the manner in which that property can be enjoyed. If the subject-matter of the lease is mineral land or a sand-mine, as in the case before us, it can only be enjoyed and occupied by the lessee by working it, as indicated in Section 108 , Transfer of Property Act , which, regulates the rights and liabilities of lessors and lessees of immovable property. ", "19.The Supreme Court, in that case, has approved the decision reported in A.I.R. 1932 Cal. 775 : I.L.R. 59 Cal. 1314 wherein it was held thus: ", "Where in a mining lease, it is agreed that on payment of royalty, the lessee would be entitled to take out coal, such a settlement may not come under the strict definition of lease, because lease under Section 105 is the transfer of a right to enjoy such property and in mining leases there is no question of enjoyment of the property and what is payable under the settlement is not rent but only the price of the quantity of coal taken. But settlements of this character are everywhere regarded as lease though not falling strictly within the definition of lease. Yet some portion however small of the surface of the earth to be used for carrying on mining operations and taking the coal out and to that extent the transaction may be taken to satisfy the requirements of the definition. ", "20. In view of the said decisions, I hold that the intention of the parties was to create an interest in . If so, it has to be considered whether the document can be admitted in evidence. ", "21. Admittedly the document is not registered. Section 17(d) of the Registration Act says, \"leases of immovable property from year to year, or for any term exceeding one year, or reserving a yearly rent\" is compulsorily registrable. In this case, admittedly, the document seems to be for a period often years. If that is so, Section 40 bars the consideration of the document for any purpose, and it says, it shall not affect any immovable property comprised therein and it cannot be received as evidence of any transaction affecting such property or conferring any power. It is subject to the Proviso that an unregistered document can be made use of for some collateral purpose. ", "22. on Registration - Fourth Edition (1989) at page 78 has commented on the scope of the said Section, namely, Section 17 . The learned author says thus: ", "An instrument giving rights to take away timber, firewood and coal along with trees is compulsorily registrable. , it was held that the transfer of right to cut timber trees for three years was not compulsorily registrable as it related to moveable property and not rights arising out of land. A lease of a colliery must bemade by a registered deed under Section 17 . , it was held that a partnership deed for extraction of mica registered outside the district of the mica mine must be regarded as unregistered and was, therefore, not admissible in evidence. , it was held that transfer of standing trees of the value of Rs. 100 or upwards is compulsorily registrable. ", "23. , the question was whether partnership deed is compulsorily registrable. The partnership was set up for the purpose of extracting mica from mines, and for the purpose of sale of mica extracted from the mines. Learned Judge of held that the same amounts to dealing with immovable property and also falls within the meaning of the phrase \"any other benefit to arise out of land\" occurring in Section 2(6) of the Registration Act. The relevant portion of the said decision reads thus: ", "A partnership set up for the purpose of extraction of mica from mines and for purchasing and selling mica extracted from the mines clearly amounts to dealing with immovable property and falls within the meaning of the phrase \"any other benefit to arise out of land\" occurring in Section 2(6) and therefore such a partnership business cannot but be held to be a business relating to immovable property. The instrument creating such a partnership creates or declares a right, title or interest in an immovable property, which is of a non-testamentary character and as such falls within Clause (b) of Section 17(1) of the Registration Act and is, therefore, compulsorily registrable. ", "24. Handing over possession for the purpose of enjoyment is an essential term of the document and the same cannot be treated as collateral. If that be so, the document cannot be admitted for any purpose, and the plaintiffs are not entitled to prove possession de hors the document. In fact, in the plaint, possession is claimed directly from the document itself. Similar question came for consideration in v. . There, the case was whether the tenant is entitled to sub-let. The prohibition contained in the document which was not registered. In that case, held thus: ", "A deed purporting to create a lease is inadmissible in evidence in case it is not registered. As such all its terms are inadmissible including the one dealing with landlord's permission to his tenant to sub-let. The question whether a lessee is entitled to create a sub-lease or not is undoubtedly a term of the transaction of lease, and if it is incorporated in the document it cannot be dissociated from the lease and considered separately in isolation. ", "25. Section 2(6) of the Registration Act reads thus: ", "2. Definitions: In this Act, unless there is anything repugnant in the subject or context, (1) to (5) xxxx (6) \"immovable property\" includes lands, buildings, hereditary allowances, rights to ways, lights, ferries, fisheries or any other benefit to arise out of land, and things attached to the earth, or permanently fastened to anything which is attached to the earth, but notwithstanding timber, growing crops nor grass; ", " , the learned Judge held that since registration of the document was invalid, it has to be taken as a document unregistered for all purposes, and if so, the document cannot be taken into consideration as creating a right in immovable property. The learned Judge held that extracting mica cannot be considered as a business relating to immovable property. It can only be a transaction in respect of an immovable property, and hence compulsorily registrable. ", "26. Learned Senior Counsel for the petitioner says that if it is a lease, naturally, the same becomes compulsorily registrable. Being an unregistered document, the very basis of the suit falls to the ground. ", "27. It is urged that such a contention was taken before the trial court, and the trial court has allowed the document to be marked, treating the same as an agreement, subject to payment of deficit stamp duty. The question whether the document was compulsorily registrable or not, was not considered by any of the courts below. If it is only an agreement of lease, the remedy of the plaintiffs can only be filing a suit for specific performance, and not by filing a suit for injunction. The suit as it stands is only for injunction stating that the plaintiffs obtained possession of the basis of the document dated 20.10.1992. The question whether the document is compulsorily registrable or not is a pure question of law, and to find out a prima facie case, the said argument can be accepted. ", "28. Alternatively also, we have to consider whether the plaintiffs are entitled to an injunction on the settled principles of law. ", "29. The lower appellate court granted injunction on the ground that as per the document dated 20.10.1992, the parties were free to handover possession and take possession and, therefore, the plaintiffs who have obtained lawful possession of the properties, are entitled to enjoy the same for the period provided in the document. The lower appellate court was of the view that the question of possession and the question of extracting granites are different, and one need not be mixed with the other, for the purpose of granting injunction. The lower appellate court was of the view that in case of injunction, possession alone is material. I cannot agree with the said finding of the lower appellate court. ", "30. If the document is treated as an agreement by which possession passed, the possession is coupled with certain rights and obligations. It cannot be-taken separately. Possession is handed over for the purpose of excavating granites only. The enjoyment of the property which is a necessary ingredient for a lease also relates to the excavation of granites only. There cannot be any question of possession without enjoyment for, possession is a necessary ingredient for a lease. The plaintiffs are not given more possession. Certain obligations also follow on the basis of the document. The petitioner herein is entitled to realise the income whenever granites are excavated. For every sq. metre of granite, the petitioner is entitled to Rs. 10,000 as consideration. There also, there is an obligation on the part of the plaintiffs to remove the granites and to level the property to an extent. These are certain obligations which go along with possession. Possession cannot be treated as independent of these obligations. ", "31. If possession and enjoyment cannot be separated, the further question that arises for consideration is, whether that enjoyment contemplated under the document could be specifically enforced. Only in cases of contract which can be specifically enforced, injunction also can be granted. ", "32. Section 41 of the Specific Relief Act deals with cases where an injunction cannot be granted Section 41(e) of the Act says that injunction cannot be granted to prevent breach of a contract, the performance of which cannot be specifically enforced. Section 14 of the said Act deals with cases where specific performance cannot be granted. Section 14(d) of the Act deals with contracts the performance of which involves the performance of a continuous duty which the cannot supervise. A reading of Ex. P-28 will show that the petitioner herein is bound to give assistance to the respondents (plaintiffs) for the performance of excavating the granites from the property. The reason described in that clause is, that excavating minor mineral is governed by Mines and Minerals (Regulation and Development) Act , 1957 and the Rules framed thereunder Section 4 of the said Act says that 'No person shall undertake any prospecting or mining operation in any area, except under and in accordance with the terms and conditions of a prospecting licence or, as the case may be, a mining lease, granted under this Act and the rules made thereunder' Section 14 of the Act says that 'The provisions of Section 5 to 13 (inclusive) shall not apply to quarry leases, mining leases or other mineral concessions in respect of minor minerals.' Therefore, the Act makes it clear that Section 4 applies to minor minerals. Under Section 15 of the Act, is empowered to make Rules in respect of minor minerals. ", "33. On the basis of the said provision, Rules have been framed in respect of minor minerals known as Tamil Nadu Minor Minerals Concession Rules, 1959. Rules 33 and 34 of the said Rules deal with leasing of quarry rights and how they have to be executed. ", "34. Rule 33 reads thus: ", "33. Leasing out of quarrying rights: If the registered holder does not intend to carry on quarrying operations himself but leases out the right to do so to another person, the registered holder and his lessee shall enter into an agreement with the Government binding themselves jointly and severally to accept the conditions and stipulations set out in these rules. The agreement shall be in the form set out in Appendix V to these rules. ", "35. Rule 34 reads thus: ", "34. Agreements to be registered: The agreements executed in the forms set out in Appendixes IV and V to these rules are compulsorily registrable under Section 17(1) of the Indian Registration Act, 1908 - the former at the cost of the registered holder and the latter at the cost of the registered holder and his lessee. ", "36. Rule 10 of Appendix IV says thus: ", "If the registered holder does not intend to carry on mining operations himself, but intends to leave but the right to do so to another person the registered holder and his lessee shall enter into an agreement with binding themselves jointly and severally to accept the conditions and stipulations herein contained which agreement shall be in the form set out in Appendix V to the Tamil Nadu Minor Mineral Concession Rules, 1959. ", "37. Appendix V deals with Form of Joint Agreement for quarrying and carrying away minor minerals by lessees, and such agreement should be executed in favour of the . I have already stated that under Rule 34 (extracted above), the agreement in favour of the will have to be registered under Section 17 of the Indian Registration Act. It is joint agreement that is contemplated, and the obligations created are also joint. So long as the lease continues, the obligations as per the agreement also shall continue. Only on the basis of the agreement executed in favour of the , mining operations also can be had. Since the petitioner must also be a party to the document in favour of the , and the continued compliance of the terms and conditions of the agreement is a condition precedent, the continued supervision of the court is also contemplated if the agreement is to be implemented for the full term. It is, therefore, Section 14(d) of the Specific Relief Act says that contracts the performance of which involves the continuous supervision by court, cannot be specifically enforced. If it cannot be specifically enforced under Section 14(d) , naturally there is a bar for granting injunction under Section 41(e) of the Act. ", "38. Fry on Specific Performance - 6th Edition (1985) says (at page 46) that specific performance will be refused in regard to contracts for the working of quarries, and coal mines, or involving the performance of continuous acts or duties. The learned author also deals with contracts which are indivisible in character wherein injunction could be refused. At page 388 of the same book, the learned author says thus in paragraph 833: ", "The principle that the court will not partially enforce contracts is illustrated by many other cases. Thus, where there was a partnership contract for an absolute term of years, leaving undefined the amount of capital and the manner in which it was to be provided, this being a contract which in its entirety the courts could not enforce, the court refused to enforce it in part, by refusing the representatives of a deceased partner a decree for the dissolution of the partnership and the sale of the partnership property. In another case the court refused to separate the parts of an award which were capable of specific performance from those which were not. And again, where the contract was that the landlord of a residential flat should employ a porter, who should do certain specified work for the benefit of the tenant, that was held to be one indivisible contract, and the court declined to interfere by injunction to compel performance of part of it. ", "39. In , Law of Specific Relief - Ninth Edition (1992), at pages 201 and 202, the learned author says thus: ", "The clause enacts that a contract, the performance of which involves the performance of a continuous duty which the court cannot supervise, cannot be specifically enforced. Thus, a contract which involves the necessity of the performance of duties continued over a long period of time, which the court cannot supervise, cannot be specifically enforced. A court can order the doing of something which has to be done once for all, so that it can see to its being done. But it will not decree specific performance of a contract, the execution of which would require, more or less, permanent supervision by the court, if it cannot make it. If the court were to make, what purported to be a final order for specific performance in such cases, such order would not be the end of litigation, but, on the contrary, its fruitful and continuous source. The test should be one of reasonableness and practicability. ", "Where a charge is created for maintenance on certain property and its rent, and a person interferes with the realisation of rent, asserting his own right to the rent of the property, the charge being for a long period involving the performance of a continuous duty, an injunction restraining interference cannot be granted as it involves the performance of a continuous duty which the court cannot supervise. ", "40. In G.C.V. Subba Rao on Law of Specific Relief - Third Edition (1989), at page 429, the learned author has considered the same question comparing the English Law. The learned author has extracted an English decision regarding the grant of injunction and specific performance. The relevant passage reads thus: ", "Contract involving performance of continuous doty - ( Section 14 , Clause, (d), old Section 21 , Clause (g) - (A) Analogous English Law- ", "In v. the lessor of certain premises agreed to provide the tenants a resident porter who was to look after the building and be in constant attendance in the building to clean the stairs and passages, receive for and deliver to the tenants letters, messages, etc. The lessors appointed a porter who was away for four hours every day acting as a cook in a neighbouring building. The tenants brought the suit for specific performance of the lessor's contract. It was held that a decree for specific performance could not be granted for two reasons. In the first place that part of the agreement which provided for the appointment by the lessors of a porter, was not divisible from so much of it as provided for the various duties of the porter and as such a contract would require the constant supervision of the court during the existence of the lease, it was susceptible of specific enforcement. Secondly, damages were a sufficient compensation for the breach. ", "41. I have already stated that Ex. P-28 has been executed only for a sole purpose, i.e., the respondents herein shall enjoy the property by excavating the granite. It is for that purpose, the same has been given. The same cannot be separated. We cannot consider possession alone as was done by the lower appellate court. If the same cannot be separated and the same is interlinked with enjoyment by excavating granite, which cannot be specifically enforced, the plaintiffs will not have a right to get injunction. ", "42. If we consider Ex. P-28 only as an agreement, the Order of the lower appellate court treating it as an agreement and collecting stamp duty for the same, as I have already said, the remedy of the plaintiffs is only to sue for specific performance of the agreement. If injunction is granted, the defendant will be prevented from entering into the property, and at the same time, the plaintiffs will continue to be in the property, without the right to excavate granite. ", "43. Learned Senior Counsel for the respondents submitted that in all mining leases, first there must be document of lease, and then only the question of getting licence from the will arise. Learned Senior Counsel wanted me to read Rule 10 of Appendix IV and V in that angle. I agree with the learned Senior Counsel that there must be a lease. But we may have to consider that by lease itself, the executee is not getting right. Even if possession is handed over, that is only for the purpose enjoined under the Act. That purpose cannot be separated from possession. So, that contention of the learned Senior Counsel has to fail. ", "44. The trial court, after taking into consideration the various Rules framed under the Mines and Minerals (Regulation and Development) Act , 1957, the plaintiffs have no case that the balance of convenience is also in their favour. In the decision of the lower appellate court, I do not find that the question of balance of convenience or irreparable injury has been considered. A prima facie case alone is not sufficient for the grant of injunction. ", "45. in , has considered this point and held thus: ", "A party is not entitled to an order of injunction as a matter of right or course. Grant of injunction is within the discretion of the court and such discretion is to be exercised in favour of the plaintiff only if it is proved to the satisfaction of the court that unless the defendant is restrained by an order of injunction, an irreparable loss or damage will be caused to the plaintiff during the pendency of the suit. The purpose of temporary injunction is, thus, to maintain the status quo. The court grants such relief according to the legal principles: ex debito justitiae. Before any such order is passed the court must be satisfied that a strong prima facie case has been made out by the plaintiff including on the question of maintainability of the suit and the balance of convenience is in his favour and refusal of injunction would cause irreparable injury to him... ", "The said decision was followed in . (1995) S.C.C. 33. In paragraph 8, gave importance to the balance of convenience, and also held that irreparable loss is also equally important as prima facie case and said that the court will have to find whether the plaintiffs can be adequately compensated if injunction is refused. Their Lordships held in paragraph 8 thus: ", " a Bench of two Judges (in which was a member) of this Court held that the phrases \"prima facie case\", \"balance of convenience\" and \"irreparable loss\" are not rhetoric phrases for incantation but words of width and elasticity, intended to meet myriad situations presented by men's ingenuity in given facts and circumstances and should always he hedged with sound exercise of judicial discretion to meet the ends of justice. The court would be circumspect before granting the injunction and look to the conduct of the party, the probable injury to either party and whether the plaintiff could be adequately compensated if injunction is refused. The court further held: (S.C.C. p.721, para.5) The existence of the prima facie right and infraction of the enjoyment of his property or the right is a condition for the grant of temporary injunction prima facie case is not to be confused with prima facie title which has to be established, on evidence at the trial. Only prima facie case is a substantial question raised, bona fide, which needs investigation and a decision on merits. Satisfaction that there is a prima facie case by itself is not sufficient to grant injunction. The court further has to satisfy that non-interference by the court would result in \"irreparable injury\" to the party seeking relief and that there is no other remedy available to the party except one to grant injunction and he needs protection from the consequences of apprehended injury or dispossession, Irreparable injury, however, does not mean that there must be no physical possibility of repairing the injury, but means only that the injury must be a material one, namely one that cannot be adequately compensated by way of damages. The third condition also is that 'the balance of convenience' must be in favour of granting injunction. The court while granting or refusing to grant injunction should exercise sound judicial discretion to find the amount of substantial mischief or injury which is likely to be caused to the parties, if the injunction is refused and compare it with that which is likely to be caused to the other side if the injunction is granted. If on weighing competing possibilities or probabilities of likelihood of injury and if the court considers that pending the suit, the subject-matter should be maintained in status quo, an injunction would be issued. Thus, the court has to exercise its sound judicial discretion in granting or refusing the relief of ad-interim injunction pending the suit. ", "Their Lordships said that injunction cannot be claimed as of right and the matter is purely discretion of court. ", "46. In a recent decision of our reported in by its Secretary and Ors. , the entire point has been considered in detail. The power of the appellate court in interfering with the discretion exercised by the trial court. Paragraphs 18 to 22 of the said decision are relevant for the purpose of this case. They read thus: ", "While dealing with the powers of the appellate court, to interfere with the exercise of the discretion of the trial court, it was held in thus: ", "Where the discretion vested in the court under Section 34 has been exercised by the lower court, the appellate court would be slow to interfere with the exercise of their discretion, In dealing with the matter raised before it at the appellate stage, the appellate court would normally not be justified in interfering with the exercise of the discretion under appeal solely on the ground that if it had considered the matter at the trial stage, it may come to a contrary conclusion. If the discretion has been exercised by the trial court reasonably and in a judicial manner the fact that the appellate court would have taken a different view may not justify such interference with the trial court's exercise of discretion. If it appears to the appellate court that in exercising its discretion trial court has acted unreasonably or capriciously or has ignored relevant facts, then it would be open to the appellate court to interfere with the trial court's exercise of discretion. ", "It was a case under Section 34 of the Arbitration Act. But it applies to all cases where discretionary orders are passed. ", " . A.I.R. 1969 S.C. 338, their Lordships refused to interfere with the discretion exercised by the trial court on the ground that the trial court has not exercised its power capriciously or arbitrarily. ", " . A.I.R. 1969 S.C. 747, in paragraph 18 (at page 755), it was stated thus: ", "This takes us to second limb of the fourth contention raised on behalf of the appellants. While it is true that the relief of declaration is discretionary, it is well-settled that it is only if the discretion is not exercised by the lower court in the spirit of the statute or fairly or honestly or according to the rules of reason and justice, that the order passed by the lower court can be reversed by the superior court. Reference in this connection may usefully be made to a decision of in and Co. v. 1942 A.C. 130, where the legal position was succinctly stated as follows: ", "There remains the question whether, assuming that in the circumstances of this case , J. had jurisdiction to make the order of reference, his conclusion must stand on the ground that it was reached in the exercise of his discretion and that the exercise of such discretion should not be interfered with an appeal. So the respondent contends while the appellants urge that even if the discretion to make the order existed, it was wrongly exercised in view of the gravity of the charges made against them of the impossibility of appeal from an official referee's finding of fact, and in view of the practicability of the case being tried before a Judge, without a jury. The law as to the reversal by a court of appeal of an order made by the Judge below in the exercise of his discretion is well established, and any difficulty that arises is due only to the application of well settled principles in any individual case. The appellate tribunal is not at liberty merely to substitute its own exercise of discretion for the discretion already exercised by the judge. In other worcis, appellate authorities ought not to reverse the order merely because they would themselves have exercised the original discretion had it attached to them, in a different way. But if the appellate tribunal reaches the clear conclusion that there has been a wrongful exercise of discretion in that no weight or no sufficient weight has been given to relevant consideration such as those urged before us by the appellant, then the reversal of the order on appeal may be justified. This matter was elaborately discussed in the decision of this in v. 1937 A.C. 473, where the proposition was stated by my noble and learned friend Lord , as follows: It is clear that should not interfere with the discretion of a Judge acting within his jurisdiction unless the court is clearly satisfied that he was wrong. But the court is not entitled simply to say that if the judge had jurisdiction and had all the facts before him the court of appeal cannot review his order unless he is shown to have applied wrong principle. The court must if necessary examine a new the relevant facts and circumstances in order to exercise a discretion by way of review which may reverse or vary the order. Otherwise, in interlocutory matters, the judge might be regarded as independent of supervision. Yet an interlocutory order of the Judge, may often be of decisive importance on the final issue of the case and one which requires a careful examination by . Thus in v. (1885) 29 Ch. D. 50, , J. in discussing the discretion of the Judge as regards mode of trial says: \"That discretion, like other judicial discretion must be exercised according to common sense and according to justice and if there is a miscarriage in the exercise of it, it will be reviewed. ", " 1990 S.C.C. (Supp.) 727 at 733-735, while dealing with a case under Copyright Act , their Lordships of held thus: ", "The appellate court will not interfere with the exercise of discretion of the court of first instance and substitute its own discretion except where the discretion has been shown to have been exercised arbitrarily, or capriciously or perversely or where the court had ignored the settled principles of law regulating grant or refusal of interlocutory injunctions. An appeal against exercise of discretion is said to be an appeal on principle. Appellate court will not reassess the material and seek to reach a conclusion different from the one reached by the court below solely on the ground that if it had considered the matter at the trial stage it would have come to a contrary conclusion. If the discretion has been exercised by the trial court reasonably and in a judicial manner the fact that the appellate court would have taken a different view may not justify interference with the trial court's exercise of discretion. ", "This Court had occasion to consider the powers of the appellate court while interfering with the discretionary orders of the trial Judge. (1989)1 L. W. 54, a Division Bench of this Court to which one among us (, J.) was a party said thus: ", "The principles governing the circumstances in which the appellate court can interfere with a discretionary order of the trial court granting or refusing injunction were laid down by Lord in v. , and the other members of the agreed with him. They were reiterated by him in v. . The following passage, in the later judgment is relevant: In an expedited appeal by the company against the Judge's refusal to grant an interlocutory injunction, the Court of Appeal 1982 Q.B. 1114 delivered an extempore judgment on May 18, 1982, shortly the publication in the Weekly Law Reports (1988) 2 W.L.R. 322 of the decision of this in v. , in which this took occasion at page 220, to point out that in appeal from the Judge's grant or refusal of an interlocutory injunction, an appellate court, including your Lordships' , must defer to the Judge's exercise of his discretion and must not interfere with it merely upon the ground that the members of the appellate court would have exercised the discretion differently. The function of an appellate court is initially that of review only. It is entitled to exercise an original discretion of its own only when it has come to the conclusion that the Judge's exercise of his discretion was based on some misunderstanding of the law or of the evidence before him, or upon an inference that particular facts existed or did not exist, which although it was one that might legitimately have been drawn upon the evidence, that was before the Judge, can be demonstrated to be wrong by further evidence that has become available by the time of the appeal or upon the ground that there has been a change of circumstances, after the judge made his order that would have justified his according to an application to vary it. Since reasons given by Judges for granting or refusing interlocutory injunctions may sometimes be sketchy, there may also be occasional cases. Where even though may no erroneous assumption of law or fact can be identified the judge's decision to grant or refuse the injunction is so abhorrent that as it must be set aside upon the ground that no reasonable Judge regardful of his duty to act judicially could have reached it. It is only if and after the appellate court had reached the conclusion that the Judge's exercise of his discretionment he set aside for one or other of these reasons, that it becomes entitled to exercise an original discretion of its own. ", "47. I have already stated that the trial court exercised its discretion in refusing the injunction. The lower appellate court did not enter a finding that the decision arrived by the trial court is capricious or illegal, or that the refusal of injunction was against any of the settled principles of law. It re-appreciated the entire facts and came to the conclusion that the plaintiffs are entitled to injunction. Unless there is a finding that the decision of the trial court is wrong, the discretion exercised by it should not be interfered with. ", "48. In case injunction is refused, plaintiffs have got other remedies open. The loss that may be sustained by them, can be compensated in costs and damages. The same can be ascertained and valued on the materials available. Unless the plaintiffs prove that they will be put to irreparable injury if injunction is not granted, they are not entitled to get an injunction order as prayed for by them. This principle was not considered by the lower appellate court. Balance of convenience is also to be considered alone with the aspect of 'irreparable injury'. Both the aspects, namely, balance of convenience and irreparable injury go together. I do not think any irreparable injury would be caused to the plaintiffs if injunction is refused. Likewise, the balance of convenience is also not in favour of the plaintiffs for getting an injunction order. The lower appellate court has passed the order without taking into consideration the legal principles enunciated under Sections 14 and 41 of the Specific Relief Act read with Order 39, Rules 1 and 2 of the Code of Civil Procedure. It interpreted the agreement, and assumed that the plaintiffs are entitled to get an order of injunction as a matter of right. The said approach has caused material injustice. ", "49. Whether any payment has been made pursuant to the agreement and whether Ex. P-28 has been executed with intent to implement it or only for the purpose of creating an evidence for taking a bank loan, are all matters to be considered during trial. ", "50. In the result, the civil revision petition is allowed. The judgment of the lower appellate court is set aside. The injunction application filed by the plaintiffs before the trial court is dismissed. The order of the trial court refusing injunction is restored no costs."], "relevant_candidates": ["0000330608", "0000355919", "0000362478", "0000604180", "0000863497", "0001006731", "0001153251", "0001519516", "0098497892"]} {"id": "0001153251", "text": ["JUDGMENT ", "1. These two appeals have arisen out of a decree which purports to have been made under Order 34, Rule 6, Civil P.C. The suit was commenced by the plaintiff on 8th November 1924 against four sets of defendants namely, defendant 1 , defendant 2 , defendants 3 to 5 the and defendant 6, The bank having subsequently gone into liquidation, the liquidators were brought in as defendant 6. On 24th February 1925 a firm carrying on business under the name and style of were added as defendant 7. ", "2. On 6th March 1919 defendant 1 had obtained a coal mining settlement in respect of coal lying under 366 bighas of land in mauzha Banbahal from the plaintiff and executed in his favour a kabuliyat stipulating to pay royalty at certain rates for the different kinds of coal to be taken and a minimum annual royalty of Rs. 5,000 that is to say at the rate of Rs. 400 a month from January to November and Rs. 600 in December and undertaking that if the royalty for each month was not paid within the 15th day thereof he would pay interest at the rate of Rs. 2 per cent per month till realization, and further stipulating that if the minimum royalty for two consecutive months be not paid within the third month the plaintiff would be competent to take khas possession of the colliery with all its appurtenances and creating a first charge on the leasehold lands machinery, stores, furniture etc., for the royalty and for all sorts of dues of the plaintiff. The suit was for recovery of minimum royalty from January 1923 to October 1924, both months inclusive, together with interest. The prayers were on the lines indicated in Order 34 of the Code. A more detailed reference will be made hereafter to the averments and prayers made in the plaint. ", "3. As regards the connexion of the other defendants with the subject-matter of the suit it would be sufficient to state the following: On 29th March 1923, defendant 1 executed a mortgage in favour of defendant 2 on receipt of Rs. 42,000 and assigned to the latter the leasehold together with the colliery and all its appurtenances, the deed being in the form of an English mortgage. On 4th April 1923 defendant 1 executed a further mortgage in similar terms in favour of defendants 3 to 5, assigning over the same properties, subject to the mortgage in favour of defendant 2, as security for Rs. 70,000 said to have been due to the said defendants on advances previously made by them. On 14th December 1923 defendant 2 assigned his mortgage debt and security to , defendant 6. On 14th November 1924 a managing agency agreement was executed by defendant 1 in favour of defendant 7 and to this deed defendants 3 to 5 and 6 were parties. ", "4. On 28th April 1925 a solenama was filed as between the plaintiff and defendant 1 and on the same day, after examination of a witness who proved the charge-created by the kabuliyat executed by defendant 1 in plaintiff's favour and also said that defendant 1 had mortgaged the properties to the other defendants, a decree was passed on the solenama as between the plaintiff and defendant 1 and ex parte as against the other defendants. To the terms of this decree referenee will hereafter be made. The properties charged were sold in pursuance of this decree but fetched Rs. 1,525 only, a small part of the decretal dues. ", "5. About two years after, on 1st March 1928, the plaintiff applied under Order 34, B. 6, Civil P. C., for a personal decree against all the defendants for a sum of Rs. 14,843 which, he alleged, was due and unrealized on account of the decree of 28th April 1925. He asserted that defendant 1 was the original lessee and the other defendants were mortgagees in; possession and were, in fact, in possession by receipt of the usufructs of the colliery. To this prayer the defendants objected. The Subordinate Judge took evidence and eventually held that the plaintiff was entitled to such a decree as against defendants 1 to 6 and made it for Rs. 17,000 odd on 30th September 1929. ", "6. The two appeals are from the said decree: No. 8 has been preferred by defendant 2, ; and No. 15 by defendants 3 to 5, the . ", "7. One singular feature of this case is. that if the pleadings and proceedings leading up to the decree of 1925 and the terms of that decree are carefully examined, it would seem that till that decree was passed the plaintiff never thought of obtaining in this suit anything beyond what he got under that decree, and it would also seem that the idea of having proceedings on the lines indicated in Order 34, Rule 6 as against defendants other than defendant 1 originated only at or about the time when the application was made for a decree under that rule. In the plaint the only averments relevant on the point were contained in paras. 11 and 17 which ran thus: ", "11. After taking a settlement of the colliery from the plaintiff defendant 1 came into possession thereof from the date of the settlement and he is possessing the same under the plaintiff, \"17. Defendant 1 has been in peaceful possession of the property settled, under the plaintiff, since the date of the settlement. The plaintiff has come to know that defendant 1 has mortgaged the leasehold property to' defendants, 2, 3, 1 and 5 and that defendant 2 has again hypothecated the mortgage deed to defendant 6. The plaintiff makes defendants 2 to 6 parties for the purpose of getting the property described in Schs.(ka) and (kha) below, free from all encumbrances, and for realizing his dues from the said property as a first charge thereon. ", "8. In prayer (ka) a decree for Rupees 10,000 odd against all the defendants was asked for prayer (kha) was for declaration of a first charge for the money due to the plaintiff. In prayer (ga) it was prayed that if the defendants did not pay the decretal amount within the time fixed by the Court the decree might be made absolute and orders might be passed for realization thereof by sale of the properties charged. Prayer (gha) asked for a personal decree against defendant 1 in case of deficiency. Prayer (una) related to interest and costs. Besides, there was a general prayer for such additional or alternative reliefs which the plaintiff might be entitled to under the agreement and according to law, justice and equity. ", "9. The solenama effected as between the plaintiff and defendant 1 was that a decree for the amount claimed together with interest and costs should be passed, that a first charge as asked for should be declared and that 15 days' time should be given to defendant 1 to pay up the royalty and interest which had not been sued for. It was provided that if such payment is made, but not otherwise, defendant 1 will have four months' time to pay up the decretal amount, or else on the expiry of the said 15 days the decree shall be regarded an final and absolute and the properties charged would be sold. It was further provided that if the entire dues be not realized by the sale plaintiff shall realize the balance of his dues by the attachment and sale of defendant 1's other moveable and immovable properties or from his person. ", "10. The only evidence then adduced by the plaintiff was what was barely sufficient to prove the settlement which defendant 1 had taken and the witness who gave that evidence only said in addition that defendant 1 had mortgaged the properties to the other defendants. And thereupon the following decree was passed. ", "It is ordered and decreed that the suit be and the same is hereby decreed in terms of solenamah against defendant 1 and ex parte as against other defendants. The period fixed by the solenamah is also fixed as against the absentee defendants as the period of grace within which the decretal amount is to be paid up. In. default the leasehold properties Ka and Kha are to be sold for satisfaction of the decree. And that the sum of Rs. 990-6-3 be paid by defendant 1 to the plaintiff on account of the costs of the suit with interest thereon at the rate 'of 12 per cent per annum from this date to date of realization. ", "11. We are unable to see that any further questions remained to be decided or determined by the upon the pleadings in the plaint and the prayera contained thereon. This view has been contested on behalf of the plaintiff upon various grounds which may perhaps be put in order and summarized as follows: It has been urged that the suit was a suit for sale on the basis of a mortgage and the decree should be regarded as a preliminary decree for sale under Order 34, Rule 4 or in any event as including a final decree for sale under Order 34, Rule 5 of the Code and can on no account be regarded as a. decree under Order 34, Rule 6. It has also been argued that at least so 'far as the defendants other than defendant 1 are concerned the decree was nothing more than a decree for sale following which there can always be a decree under Order 34, Rule 6. It has further been contended that in the plaint a decree against all the defendants had been asked for and. that although it may be that for some reason or other a personal decree against defendant 1 only had been prayed for it was always open to the plaintiff to apply for a personal decree against the other defendants later because it was not until a decree under Order 34, Rule 5 had been passed and a sale held thereunder had proved insufficient that the stage would arrive when such a decree could be made. It has lastly been argued that at the stage at which the decree was passed a decree under Order 34, Rule 6 would be entirely without jurisdiction. The matters to which our attention has been drawn in support of the grounds aforementioned have therefore to be dealt ", "12. In support of the contention that the Subordinate Judge had no jurisdiction to make a personal decree at the stage at which the decree referred to above was made the decision of this Court in the case of v. Kirtibas Das [1931] 19 I.C. 971 has been cited. That the procedure prescribed in Sections 89 and 90, T. P. Act 1882 and by the rules in Order 34 of the Code did not and does not contemplate such a decree at such a stage cannot be disputed. The very terras of Section 90 and of Rule 6, Order 34 show that such a decree can be passed only after it has been ascertained that the nett proceeds of the sale of the mortgaged properties are insufficient to pay the amount of the decree. Though this is so in many cases on some of which the plaintiff himself relies for establishing this position decided both under the Transfer of Property Act and under the Code, composite decrees embodying not merely what the decree for sale should be but also decisions as regards personal remedies have been passed by Courts. And when so passed they have not been regarded as altogether invalid but only the question whether a further decree could be had or not has been held to depend upon the terms of the decree already made: e. g. 17 I. C. 263 Khulna Loan Co. Ltd. v. Jnanendranath Base A.I.R. 1917 P.C. 85 [19191 53 I.C. 904 and 31 Bom. 244 If ever there was a doubt as regards the validity of such a decree that doubt has been completely removed by the decision of in the case of A.I.R. 1918 P.C. 159 in which it was pointed out that it is not necessary to put such a construction on Section 90 , T. P. Act as would establish as a condition precedent to the power of decreeing personal payment of the balance that the mortgaged property must first be sold and found insufficient to satisfy the debt but that the words of the section are satisfied in cases where the Court passes a decree that on the happening of the event when the nett proceeds of the sale are found to be insufficient the balance should be paid. It is therefore unnecessary to proceed on the assumption that it is impossible in any case to regard the decree that was passed in this case as a combined decree. The real question is: Can it be so construed. The decree expressly says: ", "The suit be and the same is hereby decreed in terms of the solonamah against defendant 1 and the solenamah itself is appended to the decree, and one of the terms of the solenamah is term No. 7, viz. that: ", "if all the dues of the plaintiff be not realized from the said colliery and machineries etc. the plaintiff shall realize the balance of his decree by an attachment and sale of other moveable and immovable properties of the defendant or from his person. ", "13. It is difficult to imagine how it can be contended that the decree is not a combined decree unless it be on the following grounds which the plaintiff has put forward. It has been said in the first place that as it was not a matter within the province of the to consider at that stage whether a personal decree should be passed or not the decree should be construed as being limited to the other provisions of the solenama and as not including term No. 7. Such a supposition is impossible in view of the ex-press terms of the decree and further because such a construction would have for its basis an impossible assumption that the terms of the solenama were varied by the in so far that one of its essential terms will have to be regarded as having been left out. Three oases have been cited which it has been said would favour such a construction. The first one is the case v. the bearing of which decision upon the question before us is not apparent unless it be the plaintiff's contention that the compromise was unlawful or in contravention of law or was one which did not satisfy the requirements of Order 23, Rule 3, and therefore unfit to be recorded. We cannot conceive why it should be held that it was not open to the plaintiff and defendant 1 to adjust the suit as between themselves and put an end to it altogether by entering into a compromise by providing for a personal remedy also. The next case referred to is the case of v. . What happened in that case was this. A suit was brought by mortgagee 1 to enforce a mortgage security, and in it the mortgagors as well as second mortgagees were made parties. ", "14. The claim was decreed in part by the primary . During the pendency of the appeal a petition of compromise was filed which purported to settle the differences between the plaintiffs and the mortgagors. The second mortgagees ware not parties to the settlement. The effect of the compromise was to increase the amount payable under the decree to the plaintiffs. It was held that a decree could not be passed in accordance with the compromise. The case in our opinion has decided nothing which may be useful in the present case. The third case is that of v. which has been affirmed by in v. . [1931] 137 I.C. 672 (P.C.). This case was cited, as far as we could understand, in support of the contention that even though the solenama and the decree based on it, passed at an antecedent stage, may have dealt with the question of personal remedy, yet when the stage arrives at which a decree under Order 34, Rule 6 can be passed the 's power is absolutely unfettered to make a decree in accordance with that rule irrespective of the terms of the solenama. We are unable to hold that the case is an authority for any such proposition. What was contended in that case was that even supposing there was no bargain to the effect that the defendants should be relieved of their personal liability when the preliminary decree under Rule 4 and the final decree under Rule 5 were not in complete accordance with law by reason of the fact that they were in terms of the solenama between the parties, a decree under Section 6 could not be tolerated. This contention was rejected and it was held that strict compliance with the terms of the previous rules was not an invariable antecedent to the awarding of a personal decree. The learned advocate of the plaintiff also took his stand upon another position. He urged that at least so far as defendants other than defendant 1 are concerned, the decree under consideration was nothing but a decree for sale in accordance with Rule 5, Order 34 and that therefore it was open to the plaintiff to apply for a decree 'against them under Rule 6 when the sale proceeds proved insufficient. But as against them, what was the true meaning of the decree ? It has been urged that it was a decree against them as such a decree could be against the mortgagor, defendant 1 himself. Beading the averments in the plaint, to which reference has already been made, it is plain beyond the faintest doubt that those defendants were made parties to the suit in their capacity of puisne encumbrancers and not on the ground of any liability for the mortgage debt, nor on the ground of their having been in possession. Indeed, it was never suggested that they were ever in possession, while in the clearest possible words the possession of defendant 1 was averred and pleaded. ", "15. In the evidence of the one witness who was examined on plaintiff's behalf which formed the basis of the decree that was passed against 'them ex parte, not one word is to be found as regards the possession of those defendants, and even the encumbrances in their favour were not specifically proved. But, in any case, there was nothing disclosed either in the plaint or in the evidence which would suggest even remotely that as against them any decree except such as could be made against puisne encumbrancers was intended. It has not been, nor can it be, disputed that a personal decree against a' puisne encumbrancer, merely on the footing of his being a puisne incumbrancer, is out of the question. But it has been argued that the prayers in the plaint in which the word defendants \" in the plural is used, show that a joint and several decree for the money as against all the defennants was asked for and that the use for the money as against all the defendants was asked for and that the use of the word in the decree is indicative of an intention to make such a decree. On the averments to which we have referred such an interpretation is not possible : it would mean that a prayer for a joint and several decree was made against the mortgagor as well as the puisne incumbrancers on no other footing than that;they were puisne encumbrancers; and it would leave unexplained why in prayer (gha) a personal decree against defendant 1 only was asked for. Moreover if the decree is to be construed in the way contended for on behalf of the plaintiff, namely as being a decree for money against all the defendants, where was the room for a personal decree at all? In that case the money could have been realized from their personal and other properties even on the decree as it stands. ", "16. Having considered the terms of the decree with care we can find no escape from the conclusion that it was a combined decree under Rules 5 and 6 against defendant 1 on the basis of the solenama and embodying all its terms; and as against the defendants other than defendant 1 it meant to give the plaintiff all the reliefs that he was entitled to under his plaint, namely such reliefs as he was entitled to in order to have the properties concerned sold free from their encumbrances--'which was the prayer he had made--and all that was necessary to provide for that purpose was embodied in the decree. The question whether the plaintiff could ask for a further decree against defendant 1 under Rule 6 when the amount left unrealized by the sale was ascertained does not arise for consideration here. But so far as the other defendants are concerned, we are clearly of opinion, there was no room for any further decree. ", "17. Some papers have been produced before us on behalf of the plaintiff to show that in the proceedings relating to the sale that was held, the other defendants or some of them joined with defendant 1 in making an application under Section 47 of the Code in which the insufficiency of the value stated in the sale proclamation was pleaded. It has been argued that from this fast it should be inferred that a joint and several decree as against all the defendants had in fact been passed, because they must have joined in that application on that assumption. We cannot say why those defendants did so; but even such an assumption cannot, in our judgment, alter the character of the decree such as it really was. We are therefore of opinion that the proceedings which led to the passing of the decree from which the appeals before us have boon taken were entirely misconceived and that the decree itself cannot stand. What we have already said is, in our opinion, sufficient for disposing of this appeal. But the appellants have sought to repudiate their liability for a personal decree upon various other grounds. Inasmuch as the case may not rest here, we proceed to deal with those grounds, though quite shortly. It has been urged that the settlement in this case created a charge which, since the provisions of the Transfer of Property Act , 1882 came to be introduced in the Code of 1908 in the shape of Order 34, and prior to the amendments of that order in 1929, could only be enforced by the provisions as to sale or redemption contained in that order. Rule 15 of that order ran in these words: ", "All the provisions contained in this order as to the sale or redemption of mortgaged properties shall, so far as may be apply to property subject to a charge within the meaning of Section 100 , T. P. Act, 1882. ", "18. In the case of v. [l905] 2 A.L.J. 379 Banerjee, J., expressed the view that the holder of a charge was like a mortgagee suing for sale entitled to ask for and obtain a decree under Section 90 , T. P. Act, and unless he be a person who is not entitled to a personal remedy against the person whose property is subject to the charge, he was entitled to obtain such remedy in view of the wide words of that section. He was of opinion that the words all the provisions hereinbefore contained as to a mortgagor shall so far as may be apply to the owner of such property and the provisions of Sections 81 and 82 and all provisions hereinbefore contained as to a mortgagee instituting a suit for the sale of the mortgaged property shall so far as may be apply to the person having the charge although they referred to the rights of a mortgagee instituting a suit for the sale of the mortgaged property and did not in terms refer to any other property, were wide enough to include the right to obtain a personal decree in accordance with Section 90 of the Act. , J., was of opinion that the words referred to only those provisions which deal with a sale of the mortgaged property. In the same case when it went up on appeal under the Letters Patent, v. 28 All. 365 the question was not decided, but the view of Banerjee, J., was approved. In 1908 the words of Section 100 were cut down; the words all provisions hereinbefore contained as to a mortgagee instituting a suit for the sale of the mortgaged property were deleted and the matter was reproduced in Order 34, Rule 15 as set out above. The words of that rule in their ordinary significance would limit the applicability of only those provisions in the order which relate to the sale or redemption of mortgaged property to property which is subject to a charge. The remedy by way of a personal decree therefore was |not provided for in the order. But from this we are not inclined to hold that the charge-holder would not have a personal remedy. Holders of charges, which are not recognized as mortgage under any statutory enactment, have always been treated by the as on much the same footing as mortgagees, and if it was the intention of the amendments of 1908 to take away the personal remedy from a charge-holder we think the matter would have been expressly dealt with. In the case of A.I.R. 1918 P.C. 159 the charge created by deposit of title-deeds which was not recognized as a mortgage under the then existing law was allowed to be attended with a personal remedy. There is also a decision in the case of v. A.I.R. 1930 Oudh 10 in favour of this view in which however no reason is given. We are inclined to overrule this contention. Then it has been contended that these defendants, on the footing of the assignments they obtained under the mortgages in their favour, were not liable for the plaintiff's dues. This contention has been urged on two grounds. In the first place it has been said that the settlement itself was not a lease. A lease of immovable property under Section 105 , T. P. Act, is the transfer of a right to enjoy such property. It is said that in the settlement in the present case there was no question of any enjoyment of the property, but what was given by it was the right to take out coal, and therefore the settlement did not amount to a lease. In support the observations of Lord in v. 2 H. L. Sc. & Div. 273 at p. 284 have been quoted: ", "Although we speak of a mineral lease or a louse of mines the contract is not in reality, a -lease at all in the sense in which we speak of an agricultural lease. There is no fruit that is to say there is no increase, there is no sowing or reaping in the ordinary sense of the term; and there are no periodical harvests. What we call a mineral lease is really, when properly considered a sale out and out of a portion of land. It is the liberty given to a particular individual for a specific length of time, to go into and under the land and to got certain things if he can find them and to take them away just as if he had bought so much of the soil. ", "19. Other cases also have been cited in support in which v. Christie Supra has been referred to: Coltness Iron Co. v. Black [1881] 6 A.C. 315 at p. 335 v. Wardlaw [1883] 8 A.C. 641 Munro v. Didcott [1911] A.C. 140 7 Bom. 425 Prince Mahomed Baktyar Shah v. 2 C. L. 3. 20. Reliance has also been placed upon the observations of their Lordships of in the cases of v. A.I.R. 1917 P. C. 163 and v. A.I.R. 1928 P. C. 234 that the essential characteristic of a lease is that the subject is one which is occupied and enjoyed, and the corpus of which does not in the, nature of things and by reason of the user disappear. ", "20. In the present case the states that if any surface is required lease thereof would have to be taken, and this too supports the appellant's contention that what was payable under the settlement was not rent but only the price by instalment of the quantities of coal taken. For certain purposes therefore and in order to consider whether some particular principle or dictum applicable to leases strictly socalled to mining leases, a distinction may have to be drawn since such a distinction undoubtedly exists. But settlements of this character are everywhere regarded as leases, and indeed the mortgagor as well as the appellants have, as the documents show, dealt with the subject-matter on the footing of its being a leasehold. We are not prepared to regard the settlement as anything else than as a lease though not falling strictly within the definition contained in Section 105 , T. P. Act, or partaking of the essential character of a lease within the meaning of the statute. Some portion, however small, of the surface had to be used for carrying on the mining operations and taking the coal out, and to that extent the transaction may be taken to (satisfy the requirements of the definition, We have not here to determine the extent of the leasehold. The second ground urged, so far as this contention is con-corned, is that oven if the transaction amounted to a lease, its assignment by way of English mortgage did not create a liability on such mortgagee in respect of the royalty. The decision upon which the below has relied for holding that such liability was created is the case of A.I.R. l927 Cal. 725. ", "21. In that case , , expressed the view that the English law as to the liabilities of assignees of leaseholds depends entirely upon a distinction between legal and equitable estates a distinction for which the Transfer of Property Act has loft no room in India and which is not to be imported into Indian law, that when a lessee executes an English mortgage his right to redeem is a right on certain conditions to get it back and in India this right cannot be looked upon as an equitable estate existing before re-assignment and that it cannot be held that in India a lessee does not part with his whole estate under an English mortgage and further that the whole of the interest of the lessee having been assigned over to the mortgagee the latter becomes liable for the rent. There are difficulties in the way of adopting this view in its entirely, or in any event in applying it to the present case. The definition of an English mortgage as given in the Transfer of Property Act , Section 58 , Clause (e) must be read subject to the definition of a mortgagor as given in Clause (a) of that section and consequently an English mortgage in India can hardly be regarded as the transfer of the entire estate of the mortgagor to the mortgagee; it is correct however not to regard what is left in the mortgagor as an equitable estate, but it is nevertheless some estate, an interest only in the estate having been transferred under the mortgage. In our opinion therefore it is not easy to say of an assignment by way of an English mortgage in India executed by a lessee that the whole of his estate passes under the [mortgage to the mortgagee. ", "22. The provisions of the Transfer of property Act must be regarded first before resorting to the law and practice as it obtains in England : . Then, the rule in William v. Bosanquet 3 Moore 500 that when a party takes an assignment of lease by way of mortgage as a security for money lent, the whole interest passes to him and he becomes liable on the covenant for payment of rent though he has never occupied or become possessed in fact, which is the rule on which the decision in the case of the A.I.R. l927 Cal. 725 has proceeded is itself a rule which applies only if there is no special provision to the contrary : see v. 4 Bligh. N. Section 380 . Indeed in the case of supra A.I.R. l927 Cal. 725 there was an express covenant in the mortgage for payment by the mortgagee of the rent reserved by the lease. In the case before us the mortgagor covenanted with the mortgagees, i. a., both sets of appellants, that so long as any money remained due under the mortgage he would go on paying the royalties, etc. We are accordingly of opinion that the appellant merely by reason of his being an English mortgagee was not liable for the royalties due under the lease. Then again the case of the appellants, the , seems to us to rest on a still higher footing. They were as already stated subsequent mortgagees the dead in their favour being also in the form of an English mortgage. It is very difficult to see what estate, if at all, passes to such mortgagees. If the English law is to be applied they are not liable. , J., in the case of In re Gee Ex parte Official Receiver 24 Q. B. D. 65 observed: ", "Undoubtedly in an ordinary ease of assignment for value the assignor after the assignment remains liable on his covenants, and the assignee is also liable on them by virtue of privity of estate. It is only on the ground of privity of estate that the trustee would ever become liable on those covenants; and, inasmuch as the previous assignment has transferred that liability to the assignee, leaving on the bankrupt (i. e., the mortgagor) only the liability under the covenants arising out of privity of contract he ceases to have the land burdened with onerous covenants. It is true that some years ago a question did arise as to whether in the case of a mortgage the general rule applied. This however was decided in the affirmative a considerable time ago; and it cannot be doubted at this day that where there is an assignment of the whole term to a mortgagee, the mortgagee becomes by virtue of the assignment the owner of the lease burdened with the covenants, and the assignor no longer possesses any land with onerous covenants which can by virtue of the statute become vested in the trustee. It is true that the assignor, where the assignment is by way of mortgage, retains the equity of redemption; but that is an equitable right which is not burdened with onerous covenants. It is not because he is the owner of the equity of redemption that he can be compelled to perform the covenants, but solely by virtue of the privity of contract that exists between him and the lessor, and that liability cannot by bankruptcy be transferred to the trustee. ", "23. In the Mayor, etc., of Carlisle v. [1807] 8 East. 487 at p. 497 it was said: ", "Whether a mortgagee who has not entered be or be not liable to an action of covenant as assignee, it is quite clear that the devisees of an equitable estate are not so. ", "24. We are therefore of opinion that even in a, suit properly framed for recovery of royalty from all the defendants none but defendant 1 could be made liable. Lastly it has been contended that a decree for personal liability against the appellants on the footing of their having been in possession is also not supportable, because, apart from anything else, they were in point of fact never in possession. The Subordinate Judge in holding against the appellants on this point has relied upon three pieces of materials: that there was no express denial on their part that they were in possession; that there was an admission of such possession contained in a petition of claim; and that they were parties to the agreement under which defendant 7 was appointed managing agents. As regards the omission to deny we do not set much store by it as it is not so clear that such denial was necessary. The admission contained in the petition of claim, to which however it should be stated, the appellant was not a party, is explained by the appellants the , and in our opinion that explanation is not unworthy of acceptance. So far as the managing agency agreement is concerned it is clearly an agreement by which only the mortgagor, defendant 1, appointed the managing agents with the concurrence of the and of the , their consent being necessary to vary the order of their respective charges and to create a first charge in favour of the managing agents and from this deed no inference can legitimately be made that the appellants were in possession. ", "25. On the other hand, the statements in the plaint, an affidavit of the plaintiff's agent one dated 1st December 1924, the returns submitted under the Mines Act , and the letters Ex. A series and the other evidence on the record, oral and documentary, negative the position that the appellants wore in possession. The Subordinate Judge has drawn an adverse inference against the appellants for nonproduction of their accounts but we are unable to agree with him in his conclusions. In the result we allow the appeals, and set aside the decree complained of in so far as it is against the defendants other than defendant 1. The appellants will be entitled to their coats in this as against the plaintiff-respondent, one hearing fee, which is to be divided equally between the appellants in the two appeals being allowed. ", "26. Any security, which the appellants may have deposited in pursuance of the order of this Court relating to stay of execution, will be returned to them."], "relevant_candidates": ["0000010202", "0000318969", "0000583348", "0000876853", "0001113945", "0001622190", "0001899121"]} {"id": "0001166325", "text": ["JUDGMENT , C.J. ", "1. In these two applications some of the provisions of the Cotton Textiles (Control) Order, 1948, were challenged as being opposed to certain articles of the Constitution of India. This order was made by in exercise of the powers conferred by Section 3 of the Essential Supplies (Temporary Powers) Act, 1946. It came into force on 2nd August 1948 in the place of an earlier order of February 1948. Two classes of special officers to work the provisions of this order are contemplated. One is the controller who is the principal officer appointed by a provincial for the administration, of the textile control and the other is the Textile Commissioner appointed by . This order provides for the control of raw materials and stores as well as cloth and yarn. In these two applications we are only concerned with the provisions relating to cloth and yarn. Clause (12) of the order runs as follows: ", "\"12 (1) No producer who has no spinning plant shall work or cause or permit to be worked, (a) looms in excess of the number of looms working in the undertaking on the 30th September 1944. ", "(b) Any loom for a period which in any one month exceeds the average number of hours of work per loom per month in the undertaking during the year ending 30th September 1944. ", "(2) No producer who has a spinning plant shall in any quarter -- ", "(a) purchase a quantity of yam exceeding 1/4 of-the quantity of yarn purchased by him in the year 1944; ", "(b) sell a quantity of yarn less than 1/4 of the quantity of yarn sold by him in the year 1944; ", "(3) No producer who has no weaving plant shall instal or cause or permit to be installed any loom in his undertaking. ", "(4) No person shall acquire or Instal any loom to be worked by power as defined in Section 2(f) of the Factories Act, 1934. ", "(5) Any person having in his possession any loom which he is not entitled to work or cause or permit to be worked in accordance with this clause snail forthwith report the fact to the Controller and shall take such action as to its sealing or storage as the controller may direct.\" ", "2. The clause has to be read subject to Clause 33 which provides for exclusion from and modification and relaxation of Its operation. Clause (1) runs as follows: ", "\"The Textile Commissioner may by a general or special permit exclude from or modify or relax to such extent as may be specified by him, the operation of any such provision in respect of any person, act or thing or any class of persons, acts or things.\" ", "3. Clause 30 confers certain powers on the Textile Commissioner in respect Of the distribution of cloth and yarn. It is in the following terms: ", "\"The Textile Commissioner may, with a view to securing a proper distribution of cloth or yarn or with a view to securing compliance with this order, direct any manufacturer or dealer, or any class of manufacturers or dealers -- ", "(a) To sell to such person or persons such quantities of cloth or yarn as the Textile Commissioner may specify; and ", "(b) not to sell or deliver cloth or yam of a specified description except to such person or persons and subject to such conditions as the Textile Commissioner may specify; and may issue such further instructions as he thinks fit regarding the manner in which the direction is to be carried out.\" ", "4. The petitioner in these two petitions is the properietor of situated at Kalapalti Post Coimbatore district. It is exclusively a weaving mill and not what is referred to in the affidavits as a composite mill, i.e., both a spinning and a weaving mill. In 1944, the petitioner had 10 power looms installed in his factory. In 1946 he added another 14 power looms with the permission of the Government and ever since he has been manufacturing cloth in these 24 power looms. In July 1949 he applied to the Textile Commissioner who had his office in Bombay for permission to acquire and instal 50 more power looms, as such permission was necessary under the provisions of the Cotton Textile Control Order 1948. According To the petitioner, one important reason for this application to Instal more looms was his desire to purchase, what is described as, a preparatory machinery for making, warping and sizing. This machinery was only available 5n units to serve 100 to 120 power looms in the count of yarn used by the petitioner's looms. As the petitioner had only 24 power looms he wanted to acquire further looms. The Textile Commissioner advised the petitioner to apply through at Madras. The petitioner made an application accordingly on the 19th August 1949. This application was refused by the Government on 6th December 1949. He repeated his request and was informed by the Director of Controlled Commodities in his letter dated 17th March 1950, that Permission for additional looms would not be granted in view of the meagre supply position of yarn In the State. The petitioner again made representations to the Minister for Industries with no success. On 5-7-1950 he received a communication from the Secretary to , that in view of the difficult conditions of yarn supply, the petitioner's request for permission to instal 36 additional looms would not be considered at present. Meanwhile the petitioner had purchased the preparatory machinery at a cost of about a lakh of rupees. ", "5. In the affidavit filed in support of C.M.P. No. 6181 of 1951, the petitioner stated that after 29-1-1950, i.e., after the Constitution came into force, Clause 12 (4) of the Order became void as being inconsistent with the fundamental rights granted to him, more particularly by Article 19(1)(f) and (g). The ground of attack is that the said clause, namely, 12 (4) absolutely prohibits the acquisition of installation of power looms and the prohibition is arbitrary and unreasonable. also submitted that the restriction, if any, imposed under that clause was an excessive restriction not necessary in the Interest of the general public. Clause 33 of the Order is attacked as being contrary to Article 14 of the Constitution inasmuch as it prescribes no standard of the basis on which any provision can be relaxed or excluded in respect of any person. The clause being discriminatory in character cannot be valid. In further support of his plea, the petitioner referred to other textile mill owners who had acquired and installed new power looms, though the petitioner was himself refused. This the petitioner says is discriminatory. ", "6. The petitioner also complains against the conduct of the Government officers in their allotment of yarn per loom per month. He was being allotted 400 lbs. of yarn per loom per month in 1949. In January 1950 this quantity of 400 was reduced to 200 and again in September 1950 it was further reduced to 150 lbs. and in April 1951 still further to 100 lbs. per loom per month. This restriction was apparently imposed under Clause 30 of the Order. This action on the part of the Government, i.e., the State as represented by the Director of Controlled Commodities is impugned as being unreasonable and arbitrarily discriminatory. The petitioner mentions concrete instances in which even purely weaving mills like the petitioner's were being given 300 to 400 lbs, of yarn per loom per month, though he was given considerably less. He alleges that with the amount of yarn allottment now being made it was not possible to run the mill. This might lead to even closing down the business. Both Articles 14 and 19(1)(f) and (g) or the Constitution were infringed and Clause 30 as well as the orders of Government were 'ultra vires' and invalid. ", "7. The petitioner also complains that even the allotment of yarn made to him was not being regularly supplied every month in C.M.P. No. 6181 of 1951 the petitioner's prayer is for the Issue of Writ of a Mandamus or an order directing the respondent namely, the State of Madras represented by the Director of Controlled Commodities to forbear from and in any way interfering with the acquisition and installation by the petitioner of additional power looms in his mill. In the second application (C.M.P. No. 6182 of 1951), the petitioner prayed that a Writ or order may issue directing the respondent to allot and supply to the petitioner 400 lbs of yarn per loom per month. ", "8. On behalf of the an clerk in swore to a counter-affidavit traversing the allegations and charges made by the petitioner in his affidavit. The learned Advocate-General confessed that the counter-affidavit could have been filed by some one morel responsible than a clerk. The legal position taken up in this counter-affidavit was that the Textile Commissioner had full discretion to grant or refuse permission for acquisition and installation of new looms. The refusal to give to the petitioner permission to instal new looms was said to be due to the acute scarcity of yarn in the . A reference is made to an All-India Yarn Distribution Scheme which provided for the internal distribution of cotton yarn to miscellaneous consumers including power looms. As regards the facts, the deponent of the affidavit put the petitioner to strict proof of several allegations in the affidavit. ", "9. The petitioner filed a reply affidavit In which he mentioned in detail several instances in which there had been discrimination as regards the grant of permission to acquire and instal new power looms and as regards the allotment of yarn, A further counter-affidavit on behalf of the state was filed during the hearing of the applications by the Assistant Director of Cotton. In this affidavit, he set out the history of cotton and yarn control from 1943 onwards. Provisions in the earlier orders similar to the impugned provisions pf the new order are referred to. Clause 30 was in place of Clause 18-B of the Cloth and Yarn Control Order, 1943. The purpose of this clause is said to be to secure proper distribution of yarn and proper distribution is understood to mean and means that the distribution is to be in accordance with the basic principles enacted in the order; that is to say, that while the scarcity continued, the distribution must be on the basis of the All India Yarn Distribution Scheme. As regards Clause 33, It is stated that exceptions are made under this clause after careful consideration of the various factors and almost always subject to the condition that supply of free yarn to the distribution pool is not impaired. The permissions are given according to the deponent only on specific recommendations received from the Provincial State Controller. Though there is no obligation cast on the Textile Commissioner or the Provincial Controller to feed new looms which are installed, it is pointed out that any unrestricted increase of looms will tend to affect the availability of free yarn to the pool and provide an incentive to mills and the merchants to take to blackmarket activities. The restrictive provisions to be found in Clause 18 of the Order is an attempt to limit such tendencies to a reasonable minimum. The petitioner filed a supplementary reply affidavit in which he gave instances of permission being granted to new factories, e.g., 200 power looms to a new factory in Virudhunagar and 20 power looms to a new mill in Cannanore. He also gave instances of unequal allotment of yarn among several mills. ", "10. The argument of Mr. , learned Counsel for the petitioner was in the main based on Article 14 of the Constitution which ensures to all persons equality before the law and equal protection of the laws from the . The definition of \"\" in Article 12 includes besides the of India and the Government or Legislature of each of the s, also local or other authorities within the territory of India or under the control of . Taking first the provisions regarding acquisition of looms, he contended that Clause 12 (4) of the Cotton Textiles Control Order, though in terms prohibits any acquisition or Installation, must be read with Clause 33 which empowers the Textile Commissioner to exempt wholly or in part certain cases from the operation of the provision. The combined effect of Clauses 12 (4) and 33 (1) would therefore be that unless permitted by the Textile Commissioner no new looms can be acquired or installed. Clause 33 (1) does not mention the grounds or circumstances which should influence the Textile Commissioner in granting or withholding special permission. Ultimately it comes to this, namely, that the Textile Commissioner's discretion is completely unfettered. The legal position taken up in the counter-affidavit filed on behalf of the is just this. Learned Counsel contended that conferment of such arbitrary power on the Textile Commissinoer Itself offends against the guarantee declared by Article 14 of the Constitution as such power gives ample room for discrimination. He also contended that in actual practice also the -orders of the Textile Commissioner have been discriminatory. ", "He strongly relied on the leading decision of in ' v. ', (18(6) 118 U S 356: 30 Law Ed 220. The city and county of Sanfranscico made an ordinance that it shall be unlawful for any person to engage in the laundry business within the corporate limits without having first obtained the consent of , except the same be located in a building constructed either of brick or stone. In sanfrancisco there were about 320 laundaries managed by the Chinese. Of them only about 10 were in brick buildings. The remainder were in wooden buildings, with the result that so far as the majority of the Chinese laundries were concerned, it depended entirely on the pleasure of whether any of them would or would not be permitted to engage in the business in the wooden buildings. Actually it was found that the white launderers who were carrying on business in woolen buildings were given permission; the Chinese were refused permission. The validity of the Ordinance was challenged on the ground that it was capable of being and was so operated and enforced as to discriminate against the Chinese laundries and therefore offended Section 1 of the Fourteenth Amendment of the Constitution. held that the ordinance was invalid because: ", "\"It confers a naked arbitrary power upon the to give or withhold consent and makes all engaged in the business, the tenants at wilt as to their means of living under the of Supervisors.\" ", "The following passages from, the Judgment of Mr. Justice were relied on in particular by petitioner's Counsel, Ex. 1 : ", "\"When we consider the nature and theory of our institutions of Government, the principles upon which they are supposed to rest, and review the history of their development, we are constrained to conclude that they do not mean to leave room for the play and action of purely personal and arbitrary power..... But the fundamental rights to life, liberty, and the pursuit of happiness, considered as individual possession, are secured by those maxims of constitutional law which are the monuments showing the victorious progress of the race in securing to men the blessings of civilisation under the reign of just and equal laws, so that in the famous language of the Massachussets Bill of Bights, the Government of the Commonwealth 'may be a Government of laws and not of men.' For, the very idea that one man may be compelled to hold his life, or the means of living or any material right essential to the enjoyment of life, at the mere will of another seems to be intolerable in any country where freedom prevails, as being the essence of slavery itself.\" ", "Mr. Justice quoted with approval the following observations made by in the case of 'Baltimore v. ', 49 Md 217 : ", "\"But it commits to the unrestrained will of a single public officer the power to notify every person who now employs a steam engine in the prosecution of any business in the City of Baltimore, to cease to do so, and by providing compulsory fines for every day's disobedience of such notice and order of removal, renders his power over the use of steam in that city practically absolute, so that he may prohibit its use altogether. But if he should not choose to do this, but only to act in particular cases, there is nothing in the Ordinance to guide or control his action. It lays down no rules by which its impartial execution can be secured or partiality and oppression prevented. It is clear that giving and enforcing these notices may, and quite likely will, bring ruin to the business of those against whom they are directed, while others from whom they are withheld, may be actually benefited by what is thus done to their neighbours; and, when we remember that this action or non-action may proceed from enmity or prejudice, from partisan zeal or animosity, from favouritism and other improper influences and motives easy of concealment and difficult to be detected and exposed it becomes unnecessary to suggest or comment upon the injustice capable of being wrought under cover of such a power, for that becomes apparent to every one who gives to the subject a moment's consideration. In fact, an ordinance which clothes a single individual with such power hardly falls within the domain of law, and we are constrained to pronounce it inoperative and void.\" ", "Learned counsel referred to the several instances mentioned in the affidavits filed by the petitioner as demonstrating the arbitrary nature of the power conferred on the Textile Commissioner by Clause 33. There is no use, Counsel urged, relying upon any presumption that the Textile Commissioner would not do anything improper or unjust or unreasonable. It is dangerous that the rights of persons should depend upon any personal quality of a particular officer, in a recent case ' ', , relating to the Administration of Evacuee Property Ordinance, XXVI of 1949, this Court was called upon to pronounce on the validity of certain, of its provisions. Section 20 of the Ordinance prohibits an intending evacuee from transferring in any manner whatsoever any immovable property in which he has any right or interest except with the previous approval of the Custodian, and any transfer made in contravention of the section shall be void. It was conceded that there were no rules laying down the grounds on which any transfer could be approved or refused. Meeting the argument that the Custodian would not ordinarily refuse to approve any transfer unless for proper grounds, I said: ", "\"But surely that would be gambling on the reasonableness of the Custodian. As the section stands, there is nothing to prevent the Custodian from most unreasonable refusing to approve of any transfer by an intending evacuee.\" ", "Reliance was placed on these remarks by the learned Counsel for the petitioner. Reference was also made to the decision in ' ', for the general proposition that deprivation of valuable rights of property without the necessity of giving any reasons for the action would be unconstitutional. , J., observed in that case thus: ", "\"An order which arbitrarily or excessively invades the right of an individual cannot be said to contain the quality of reasonableness, Clauses 9 and 13 of the Rice Mills Control Order which no doubt empower cancellation or refusal of a licence already issued and refusal to issue a new licence without assigning any reasons. But there can be no doubt that these provisions overstep the limits of reasonableness and must be held to be invalid in the face of the written Constitution of India. It is clear law that an arbitrary or capricious exercise of the power is no exercise at all. If no reasons are assigned it is not possible to know or judge whether the order is a valid or a mala fide or arbitrary order.\" ", "11. More or less the same line of reasoning was adopted when the learned Counsel also invoked the provision of Article 19(1)(f) and (g) of the constitution read with Article 19(5) and (6). It was contended that a total prohibition of acquisition and installation of looms would not be a reasonable restriction and the decision of in ' v. State Of Madhya Pradesh', 1950 S C J 571, was Cited in support of the contention. In that case the impugned Act totally prohibited the carrying on of the business of manufacture of beedies in certain villages within the agricultural season. Their Lordships held that this was not in the nature of reasonable restriction within the meaning of Article 19(6). , J., who delivered the judgment of the construed the phrase \"reasonable restriction\" in the following manner: ", "\"The phrase 'reasonable restriction' connotes that the limitation imposed on a person in enjoyment of the right should not be arbitrary or of an excessive nature, beyond what is required in the interests of the public. The word \"reasonable\" implies intelligent care and deliberation, that the choice of a course which reason dictates. Legislation which arbitrarily or excessively invades the right cannot be said to contain the quality of reasonableness and unless it strikes a proper balance between the freedom guaranteed in Article 19(1)(g) and the social control permitted by Clause (6) of Article 19 , it must be held to be wanting in that quality.\" ", "12. The learned Advocate-General did not completely endorse the legal propositions set out in the counter-affidavit filed on behalf of the as regards the arbitrary and unfettered discretion of the Textile Commissioner. He relied in general upon circumstances which compelled the to regulate the' proper distribution of yarn and manufactured cloth and the acute shortage of yarn. He also relied on the circumstance that the main Act, Essential Supplies (Temporary Powers) Act, was itself a temporary measure. Any scheme devised by the for a fair and equal distribution of essential commodities cannot be said to be imposing unreasonable restrictions though the scheme may certainly affect prejudicially some persons. It will be difficult and improper for the to embark on the actual measure taken by the or its special officers to secure a fair and equitable distribution. He cited to us two decisions of the United s supreme which dealt with this question of distribution. ", "In 'Railraod Commission Of Texas v. ', (1940) 310 US 573:84 Law Ed 1368 the validity of an order promulgated by came up for consideration. The statutes empowered to make rules and regulations for the prevention of waste of oil and natural gas. It was specially provided that in the exercise of the powers conferred on them, the commission shall in the event of any regulation was adopted limiting the production of oil and natural gas in any pool, prorate or apportion the allowable production of the pool among the various producers on a reasonable basis. The Commissioner made a proration order tinder which allowances were based upon the hourly potential capacity of the well. The result was a flat per well allowance to the producers. The validity of the Order was challenged on the ground that it was opposed to the Fourteenth Amendment because the proration order was not reasonable and it was arbitrary. An alternative mode of distribution was suggested as better than the principle adopted by the commission in their order. held that the order in question wag quite valid and that a in reviewing the action of an administrative agency to which the promotion and execution of State Policy has been entrusted must not substitute its notions of expediency and fairness for those which have guided such agency. Whether in prorating oil production, any particular system was better than the others wag a question not for the s but for the administrative agency entrusted by the state with the duty of making such proration. Mr. Justice who delivered the opinion of the pointed out the innumerable difficulties in trying to adjust the many conflicting interests and that the commitments of a delicate process of adjustment to the administrative process will not escape challenge in s, but such cases, were only episodes in. the evolution of adjustment among private interests and on the reconciliation of all the private interests with the underlying public interests in vital sources of energy, ", "13. In the other American case, 'Secretary Of v. ', (1950) 338 U S 604:94 Law Ed 381, an order of the Secretary of allotting sugar quota among various refineries under the provisions Of the Sugar Act of 1948 came up for review. To counteract the serious evils resulting from an uncontrolled sugar market and to rationalise the mischievous fluctuations of a free sugar market, the legislature adopted the devise of a quota system and the volume of sugar moving to the continental. United States Market was controlled to secure an harmonious relation between supply and demand. Under the Act of 1948, five sugar producing areas were defined and to each area was allotted an annual quota of sugar. Under Section 205-A of the Act the Secretary of was authorised to allot the refined sugar quota as well as the inclusive allowance of a particular area among those marketing sugar on mainland from that area. The section inter alia provided that allotment shall be made in such manner and for such amounts as to provide a fair, efficient and equitable distribution of such quota or proration thereof by taking into consideration three factors (1) proceedings of sugar to which proportionate shares pertained, (2) past marketings; and (3) ability to market the amount allotted. An allotment made by the Secretary in exercise of the power conferred by the section was challenged on the ground that the Act, itself was not valid under due process clause of the Fifth Amendment, besides other grounds. It was held that the Act did not offend the due process clause because of the alleged discriminatory character. Mr. Justice who delivered the opinion of the after referring to the old and obstinate sugar problem of the country and the necessity for some sort of regulation to ameliorate the effect of disorderly competition observed that it was not for the to substitute its notion of expediency and fairness for that of the . He said: \"It would be a singular intrusion of the into the legislative process to extrapolate restrictions upon the formulation of such an economics: policy from those deeply rooted notions of justice which the due process clause express.\" and again: ", "\"This is not a tribunal for relief from the crudities or inequities of complicated experimental economic legislation.\" ", "14. The learned Advocate-General also cited to us a decision of in v. ', 80 C L R 432. The Transport Regulation Act provided that a commericial goods vehicle should not operate on any public highway unless licensed in accordance with the Act. was empowered to grant such licences, and it was provided that in granting or refusing licences the Board should have regard to the interests of the public generally and should take into consideration the advantages of the service proposed to be provided, its convenience to the public, the adequacy of the existing transportation etc. It was held that the Act did not contravene Section 92 of the Constitution which provided that: ", "\"Trade, commerce and intercourses among the States, whether by means of internal carriage or ocean navigation shall be absolutely free.\" ", "It was held that Section 92 did not preclude the commonwealth or from in any way regulating or controlling inter-State trade and commerce and what was not permitted was prohibition and not regulation. , posed the question in issue thus: ", "\"Is the effect of a challenged Act in relation to inter-state trade and commerce direct or remote? If it is remote no question in relation to Section 92 arises. Next, where the effect of the Act is direct, is the Act in its true character regulatory and not merely prohibitive? If it is truly regulatory and not prohibitive it will not be invalidated by Section 92 . The question, therefore, is whether the Transport Regulation Acts of Victoria are regulatory or prohibitive.\" ", "15. I shall first take up Clause 12 (4). In terms this provision imposes an absolute prohibition of acquisition and installation of new looms. I have grave doubts if such a total prohibition would be valid, having regard to the fundamental rights conferred on the citizen by Article 19(1)(i) and (g). Can total prohibition from the exercise of any right be ever justified as a reasonable restriction within the meaning of that expression as it occurs in Article 19(5) and (6). I am inclined to think that a total prohibition unless it be for a short and prescribed time will be invalid. I quite realise that there may be emergent situations when such absolute prohibition may be necessary. But such contingency is provided for by Article 358 of the Constitution. When the President is satisfied that a grave emergency exists whereby the security of India, or any part of the territory thereof is threatened whether by war or external aggression or internal disturbance, he may by proclamation make a declaration to that effect ( Article 352 ). While such proclamation is in operation nothing in Article 19 shall restrict the power of the state to make any law or to take any executive action which the State would but for the provisions contained in Part III of the Constitution be competent to make or to take ( Article 358 ). In such a state of emergency a total prohibition of the exercise of the right conferred by Article 19 may be valid, but otherwise, I am of opinion that it would be unconstitutional. An illustration of this principle is to be found in the 'BEEDI CASE'. ' ', 1950 S C J 571. Clause 12 (4) by itself must therefore be held to be 'ultra vires' and void after the coining into force of the Constitution. ", "16. But both sides argued before us on the footing that there was really no absolute prohibition but there was only a restriction, because Clause 12 (4) has to be read with Clause 33 which gave power to the Textile Commissioner to permit in particular cases the acquisition and installation of new looms. What the petitioners' Counsel urged before us was that there was nothing in Clause 33 to indicate the factors which should be taken into account in the exercise of the Textile Commissioner's discretion. If his discretion is completely unfettered, as was suggested in the counter-affidavit filed on behalf of the , can it Be said that the provision does not conflict with the right of equal protection conferred by Article 14 Is there not scope for if the clause does not really invite discrimination? Can valuable rights of citizens be left entirely to the arbitrary discretion of the Textile Commissioner? I think that such an arbitrary and unfettered discretion would not amount to a reasonable restriction within the meaning of Article 19(5) and (6). It would be unreasonable to gamble on the reasonableness of the Textile Commissioner, to use the language in an earlier decision of this Court in ' of evacuee property madras', . The salutary principle enunciated in 'Yick Wo v. Hopkins', (1886) 118 D S 356 : 30 Law Ed. 220, would render such a provision obnoxious to the Constitution. So long as the possibility of a provision like Clause 33 being applied in a manner not sanctioned by the Constitution cannot be ruled out, it must be held to be wholly void. As observed in ' ', 1950 S C J 418 at P. 428 : ", "\"Where a law purports to authorise the imposition of restrictions on a fundamental light in language wide enough to cover restrictions both within and without the limits of constitutionally permissible legislative action affecting such rights it is not possible to uphold it even so far as it may be applied within the constitutional limits, as it is not severable. So long as the possibility of its being applied for purposes not sanctioned by the Constitution cannot be ruled out; it must be held to be wholy unconstitutional and void.\" ", "17. The petitioner has also mentioned concrete instances to show that there has been discrimination in the grant of exemptions under Clause 33 of the order. It is not necessary for us to discuss whether the exemption in each case was justified or not. What is of significance is that there is scope for discrimination. In the absence of any statutory rules to indicate the manner in which the discretion of the Textile Commissioner should be exercised it is impossible to say whether his discretion in a particular case is or is not justified. If the yardstick is only the personal opinion of the Officer concerned, it is plainly a case of a naked and arbitrary power. It is therefore not only desirable but also necessary that proper rules should be framed and general principles laid down to govern the discretion vested in the Textile Commissioner under Clause 33. If that is done and individual cases are dealt with accordingly without making any discrimination there could be no valid complaint. ", "18. The proper order in the circumstances which I think should be passed on this petition (C.M.P No 6181 of 1951) is to direct the respondent to deal with and dispose of the petitioner's application without making any discrimination on any ground, in the light of the observations made herein. ", "19. In C.M.P. No. 6182 of 1951 relief is sought in respect of the allotment of yarn. Clause 30 of the Order already extracted above confers on power to direct any manufacturer or dealer or any class of manufacturers or dealers to sell to specified person only-such quantities of cloth or yarn as the Commissioner may specify, and likewise not to sell or deliver cloth or yarn except to specified persons. Besides the indication in the opening words of the clause, namely \"with a view to securing a proper distribution of cloth or yarn or with a view to securing compliance with this order\", there Is no rule laid down as to the manner in which the proper distribution has to be effected among the several concerned persons. The petitioner complains that in actual practice has discriminated between person and person but apart from actual discrimination, he also challenges the validity of the provision on the ground that It contravenes the principle Of equal protection of the laws and also that it is not a reasonable restriction on the exercise of the right conferred by the Constitution under Article 19(1)(f) and (g). In the original counter-affidavit filed on behalf of the , except stating that the petitioner's request to allot 400 lbs. of yarn per month cannot be complied with in view of the acute scarcity of yarn in the and that supplies of yarn are being regulated to the power looms month after month on the basis of the yarn, allotments made to this by , Bombay, there is nothing else which gives us any information as to the principles on which the distribution is made. In the petitioner's affidavit it was definitely alleged that certain purely weaving mills i.e., mills belonging to the same category as that of the petitioner were still being given 300 to 400 lbs. of yarn per month and that he was being discriminated unreasonably and arbitrarily, in the counter affidavit, there is only a bare denial and the petitioner is put to strict proof of the allegations. I must confess that I am surprised at this attitude on behalf of the . Even in the affidavit subsequently filed by the Assistant Director of Cotton, Bombay, there is no indication as to the basis on which the yarn is allotted to the several mills. ", "20. I quite realise that during periods of acute shortage of essential goods and commodities, it is not only desirable but also imperative that the state should take steps to regulate their purchase and sale with a view to an equitable distribution among all the consumers. Legislation undertaken with this object, though it may in a sense, be restrictive of free trade, cannot be declared to be unconstitutional so long, of course, as restrictions are necessary in the interests of the general public and the restrictions are reasonable. It is also clear that legislation in the matter of controls cannot go into the minutest detail of the actual distribution. As Mr. Justice observed in ' v. ', (1940) 310 U S 573: 34 Law Ed. 1368, \"merely writing laws is only the beginning of the matter. The Administration of these laws is full of perplexities\". The commitment of the delicate task of adjusting many conflicting interests and overcoming innumerable difficulties in making an equitable distribution must needs be to administrative agency. But the question is whether the administrative agency should have an arbitrary and unfettered discretion or should be bound by certain broad principles and rules which it could not transgress. .', (1950) 338 U S 604 : 94 Law Ed 381 the same learned Judge (Mr. Justice ) made the following illuminating observations in speaking of the administrative function entrusted to the Secretary of Agriculture in allotting sugar quotas, \"He could not be left at large and yet he could not be rigidly bounded. Either extreme would defeat the control system. They could be avoided only by laying down standards of such breadth as inevitably to give the secretary leeway for his expert judgment. Its exercise presumes a Judgment at once comprehensive and conscientious.\" ", "21. It will be seen that in the two American cases above referred to on which the learned Advocate General placed reliance, the administrative officer was not left at large. In the Oil case there was a general rule of prorata allotment. In the sugar case the legislature laid down three factors which had to be taken into consideration in making the quotas. But in the present case no rules or principle nave been made or laid down which should guide the Textile Commissioner in making a proper distribution of cloth or yarn. As the clause stands, there is nothing to prevent the Textile Commissioner from Issuing any arbitrary order. He can exclude for no reasons certain persona altogether in his scheme of distribution. He can also discriminate. The petitioner's definite charge that mills placed in the same position as his mill have been allotted more quantities of yarn than his mill stands unrefuted. ", "22. The question then is what this Court should do in these circumstances. Learned counsel for the petitioner asked us to declare Clause 30 to be wholly ultra vires and void. The result of such a declaration would be to destroy the whole scheme of textile control. I spent anxious thought on the disastrous consequences of such a course. I have already said that during the periods of acute shortage of essential goods there could be indeed, there should be a certain amount of regulation with a view to ensure fair and equitable distribution. I have already referred to observations of learned Judges of of the United States that the details of any scheme of regulation or control can only be worked out by administrative agency and not by definite provisions in the Statute. In this connection I found the following passage in Willis' Constitutional Law very suggestive, \"Is it proper classification to put in one class those who get the consent of a board or of an official and into another class those who do not where no standard is set up to control the action of the board or official? Some cases answer this question in the affirmative, while other cases answer it in the negative. Perhaps the best view on this subject is that due process and equality are not violated by the mere conference of un-guided power but only by its arbitrary exercise by those upon whom conferred. ", "If a Statute declares a definite policy, there is a sufficiently definite standard for the rule against the delegation of legislative power, and also for equality if the standard is reasonable. If no standard is set up to avoid the violation of equality, those exercising the power must act as though they were administering a valid standard. For this reason there is a need for a judicial review to see whether or not power delegated has been exercised arbitrarily.\" ", "23. Clause 30 lays down the ultimate end in view, namely, a proper distribution of cloth and yarn. If in accordance with and in pursuance of this policy, the Textile Commissioner had arrived at a scheme of distribution on a certain and ascertainable basis which is free from any charge of discrimination and he had placed that scheme before this Court and convinced us that the petitioner before us has been allotted the proper quota in accordance with the scheme, then we would have been loth to interfere, unfortunately however, and presumably in spite of the efforts of the learned Advocate General, we have not been informed of any such general scheme. There is no doubt a reference to an scheme in the counter affidavit filed on behalf of the State, but no particulars of the scheme have been put before us. We are unable to know if the quota allotted to the petitioner is covered by this scheme. The petitioner has stated in his affidavit that mills practically in the same category as his mill have been allotted 400 lbs. per loom per month. This allegation has not been shown to be wrong. Nor has it been shown, that owing to other valid reasons, the quota of 400 lbs. should be reduced. In the absence of any justification for discriminating against the petitioner in this matter, we are compelled to hold that there has been a breach of the guarantee of the equal protection of laws vouchsafed by Article 14 and of the fundamental right declared by Article 19(1). ", "24. At the same time I am not disposed in this application to declare that Clause 30 is totally void. It appears to me that if in the exercise of the powers granted under Clause 30, the Textile Commissioner has evolved a proper scheme of distribution which does not offend either against Article 14 or Article 19(1)(f) and (g) read with Article 19(5) and (6) then there is no room for complaint by any person on the ground that his rights have been unlawfully affected to his prejudice, if till now the authorities concerned have not evolved any general scheme it will be open to them to hereafter at least lay down the general principles of distribution. ", "25. In the circumstances I think the proper order for us to make is to direct the respondent to consider the application of the petitioner for allotment of yarn on its merits without making any discrimination and in accordance with general rules as to fair and equitable distribution that may be made on the subject. ", "26. The petitioner will have his costs in the two applications; advocate's fee Rs. 250 in each. ", ", J. ", "27. These are petitions filed under Article 226 of the Constitution raising the question of the validity of some of the provisions of the Cotton Textiles Control Order, 1948. The petitioner is the proprietor of called at Kalapatti in Coimbatore district. In 1944 the factory was equipped with ten power looms. In 1946 the petitioner applied to the for permission to instal 14 more power looms and the same was granted and the factory has been working ever since with 24 power looms. The Cotton Textiles Control Order, 1948, with which we are now concerned came into force on 2nd August 1948. Clause 12(4) of this Order runs as follows: ", "\"No person shall acquire or instal any loom to be worked by power as defined in Section 2(f) of the Factories Act, 1934.\" ", "Clause 33(3) of the Order is in these terms: ", "\"Notwithstanding anything contained in this order the provisions of the clauses specified in schedule C shall have the effect subject to the powers of the Textile Commissioner under Sub-clauses. 1 and 2 to withdraw or relax any order of all the restrictions enacted in those provisions.\" ", "Clause 12 is one of the provisions included in Schedule C. ", "28. In 1949 the petitioner applied under Clause 33(3) for permission to instal 50 more power looms, but that was refused by a communication dated 6-12- ", "1949. The petitioner made further representations in the matter to the Government and again permission was refused by an order dated 17th March 1950. The ground for refusal being the meagre supply position of yarn in the country. The petitioner contends that Clause 12(4) is an invasion of the rights to acquire property and to carry on trade conferred on him under Article 19(1)(f) and (g) and that the power conferred on the Textile Commissioner to withdraw or modify the restrictions in Clause 12(4) is arbitrary and discriminative and void under Article 14 of the Constitution. ", "29. The petitioner also complains that the quantity of yarn allotted to him by the Textile commissioner has been undergoing a steady decline that starting with 400 lbs. per loom per month it has now been reduced to 100 lbs. per loom per month and that even that quantity is not regularly supplied and that under the circumstances it has become impossible to carry on business. Clause 30 of the Cotton Textile Control Order which empowers the Textile Commissioner to control the distribution of yarn is as follows: ", "\"The Textile Commissioner may, with a view to securing a proper distribution of cloth or yarn or with a view to securing compliance with this order, direct any manufacturer or dealer, or any class of manufacturers or dealers ", "(a) to sell to such person or persons such quantities of cloth or yarn as the Textile Commissioner may specify, ", "(b) Not to sell or deliver cloth or yarn of a specified description except to such person or persons and subject to such conditions as the Textile Commissioner may specify and may issue such further instruction as he thinks fit regarding the manner in which the direction is to be carried out.\" ", "The contention of the petitioner is that this clause also is repugnant to Article 14 as it confers wide and arbitrary powers on the Textile Commissioner and that it is therefore void. Thus the points for determination are the validity of Clause 12 (4), CL 33(3) and Clause 30 of the Cotton Textile Control Order, 1948. ", "30. I shall first set out the relevant legislative provisions bearing on the question. Under 9 and 10 George VI, Chap. 39 India (Central Government and Legislature) Act , the British conferred on certain powers. In the exercise of those powers, passed the Essential Supplies (Temporary Powers) Act, XXIV of 1946. The preamble to the Act shows that the object of the Legislation was to continue the war-time control of the production, supply and distribution of essential articles for a further period. ", "31. Section 3(1) enacts: ", "\", so far as it appears to it to be necessary or expedient for maintaining or increasing supplies of any essential commodity or for securing their equitable distribution and availability of fair prices, may by notified order provide for regulating or prohibiting the production, supply or distribution thereof and trade and commerce therein.\" ", "Section 3 , Clause (2) provides for the regulation of the production, manufacture, acquisition and transport etc., of the essential commodities by licences. Section 4 enacts that the might exercise these powers through any officer subordinate to or through the provincial or any officer subordinate to the Provincial as may be specified. Under Section 14(1) no order made in exercise of any power conferred by the Act could be called in question in any Court. The life of this Act has been extend-ed from time to time by resolutions of the legislature dated 25-2-1948, 23-3-1949 and 20-12-1949 and finally it has been extended upto 31-12-1952 by Act LII of 1950. The Cotton Textiles Control Order now under consideration was made in the exercise of the powers conferred under Section 3(1) and came into force on 2-8-1948. There is no question but that this order was valid when it was made. What is in dispute is whether the impugned clauses have become void under the Constitution, ", "32. It will be convenient to deal first with the question whether Clause 33(3) is void under the Constitution. This clause undoubtedly confers on the Textile Commissioner a Wide and unrestricted power to withdraw or modify Clause 12(4) in such manner as he pleases. It lays down no principles which he has to observe in exercising this power. No rules have been made prescribing the conditions on which the applicant is to get exemptions or modification. No directions are given controlling in any manner the discretion of the commissioner. He is not bound to give any reasons for his orders. On the language of Clause 33(3) there is nothing to prevent the commissioner from granting exemption to some and refusing it to others at his own will and pleasure, indeed the petitioner complains in his affidavits that there has been such discrimination and he has given particulars therefor. ", "33. The counter affidavit contains a general denial and avoids an answer to the particulars but it is unnecessary to decide whether the complaints of the petitioner are well founded and whether there has been discrimination or not, because the validity of the provisions does not depend upon the result of their working. A valid statute cannot be rendered void by the incompetence of the person who has been charged with its administration any more than a void statute can be rendered valid by an efficient officer working it to satisfaction. In either case the validity of the enactment should be determined, on its own merits. If the impugned provisions confer an absolute and un-restricted power, discrimination is inherent in their very nature and they must be declared void without further investigation as to whether in fact there has been discrimination or not. The well-known observation occuring in ' v. ', (1694) 154 US 362: 38 Law Ed 1014 at 1024, \"This, as has been often observed, is a Government of laws and not a government of men\" seems eminently adapted to this context. ", "34. I shall now deal with the authorities cited on either side. Mr. the learned advocate for the petitioner relied on the decisions in 'YICK WO. v. HOPKINS', (1886) 118 U S 356: 30 Law Ed 220, ' ', and the observations in ' ', . In ', v. ', (1886) 118 U S 356: 30 Law Ed 220 an order of the city and county of San Francisco provided that it would be unlawful for any person to engage in laundry business in buildings other than those constructed of brick or stone without the permission of the . No regulations were made prescribing conditions to be complied with for obtaining the consent. In holding that this provision was invalid delivering the unanimous opinion of the observed as follows: ", "\"There is nothing in the Ordinances which points to such a regulation of the business of keeping and conducting laundries. They seem intended to confer and actually do confer not a discretion to be exercised upon a consideration of the circumstances of each case but a naked and arbitrary power to give or withhold, consent, not only as to places but as to persons,\" ", "\"It is purely arbitrary and acknowledges neither guidance nor restraint.\" ", "(Pp. 356-374). ", " ', , the question was about the validity of an order passed under West Bengal Bice Mills Control Order, 1949. Clause 9 of this order is as follows: ", "\"Notwithstanding anything contained in this order the Commissioner may, without assigning any reason, direct any application for the issue of a licence or for the renewal of a licence be refused.\" ", "Under this clause an order was passed prohibiting the husking of paddy after 14-12-1950. In holding that this order was 'ultra vires' observed as follows: ", "\"An order which arbitrarily or excessively invades the right of an individual cannot be said to contain the quality of reasonableness. Clauses 9 and 13 of the Rice Mills Control Order which no doubt empower cancellation or refusal of a licence already issued and refusal to issue a new licence without assigning any reasons. But there can be no doubt that these provisions overstep the limits of reasonableness and must be held to be invalid, in the face of the written Constitution of India. ", "These provisions do not give any opportunity to the licence holder to make any representation against the action taken by the authorities concerned or to protect their interest against any wrongful action of the authorities and they further provide scope for the exercise of the power conferred on the authorities in an arbitrary and capricious manner, if they so choose to do it. It is clear law that an arbitrary or capricious exercise of the power is no exercise at all. If no reasons are assigned, it is not possible to know or judge whether the order is a valid or mala fide or arbitrary order.\" ", "Reliance is also placed on certain observations occurring in ' ', . Dealing with Section 20 of the Administration of the Evacuee Property Ordinance, No. XXVI of 1949 which provides that no intending evacuee shall transfer his property without the consent of the custodian, my Lord the Chief Justice referred to the absence of rules indicating on what grounds the transfer should be refused and then observed as follows: ", "\"It may be said that the Custodian would not ordinarily refuse to approve any transfer unless for proper grounds. But surely that would be gambling on the reasonableness of the custodian. As the section stands, there is nothing to prevent the Custodian from most unreasonably refusing to approve of any transfer by an intending evacuee.\" ", "As against this the learned Advocate General relied on ' v. ', (1940) 310 U S 573: 84 Law Ed 1368, 'Secretary Of Agriculture v. ', (1950) 338 U S 604; 94 Law Ed 331 and certain observations in ' v. ', 80 CLR 432 (Australia). In ' v. ', (1940) 310 U S 573 : 84 Law Ed 1368, the question was about the validity of the proration order issued by the commission regulating production of oil \"on hourly potential basis\" with exceptions in cases of wells with low productive capacity called \"marginal wells\". and complained that the rules framed by the commission put the owners of the marginal wells in a favoured position and that the restrictions on production crippled the non-marginal owners in the enjoyment of their rights, that those restrictions were unreasonable and amounted to depriving them of their property without due process of law. It was held that certain rales and formulas having been adopted by the commission in a matter requiring special knowledge it was not within the province of the to interfere with them. ", "\"A controversy like this always calls for fresh reminder that Courts must not substitute their notions of expediency and fairness for those which have guided the agencies to whom the formulation and execution of policy have been entrusted,\" ", "and dealing with the contention that there was discrimination in favour of the smaller owners the observed: ", "\"Plainly these are not issues for our arbitrament. The State was confronted with its general problem or proration and with the special relation to it of the small tracts in the particular configuration of the East Texas field. It has chosen to meet these problems through the day to day exertions of a body specially entrusted with the task because presumably competent to deal with it. In striking the balances that have to be struck with the complicated and subtle factors that must enter into such judgments, the commission has observed established procedure. If the history of proration is any guide the present order is but one more item in a continuous series of adjustments. It is not for to supplant the commission's judgment even in the face of convincing proof that a different result would have been better.\" ", "In that case there were definite rules framed with reference to various classes of wells and there was no question of any arbitrary exercise of power. What was decided was only that the Courts were not competent to sit in Judgment on the propriety or fairness of the rules which had been duly framed under the statute. In this case no such rules have been framed. ", "35. In 'Secretary Of v. ', (1950) 338 U S 604: 94 Law Ed 381, the validity of certain provisions in the Sugar Act was in question. For the purpose of controlling Sugar market the quota system was adopted. The Secretary of was empowered to make allotments after taking into consideration, processing, past marketing and ability to market. The Act also fixed an annual quota of refined sugar which may be marketed from the off-shore areas but there was no such restriction on the mainland refiners. The validity of these provisions was contested on the ground that fixing 1935 to 1941 as the basic period operated harshly on the new comers and that fixing of quotas only for off-shore area refiners and not for the mainland refiners was discriminative and in violation of due process clause. In repelling this contention the observed: ", "\"To fix quotas on a strict historical basis is hard on latecomers into the industry or on those in it who desire to expand. On the other hand, to the extent that new comers are allowed to enter or oldtimers to expand there must either be an increase in supply or a reduction in the quotas of others. Many other, factors must plague those charged with the formulation of policy the extent to which projected expansion is a function of efficiency or becomes a depressent of wage Standards; the wise direction of capital into investments and the economic waste incident to what may be on the short or the long pull over expansion of industrial facilities; the availability of a more suitable basis for the fixing of quotas etc. The final judgment is too apt to be a hodgepodge of considerations, including considerations that may well weigh with legislators but which this can hardly disentangle.\" ", "and again \"This is not a tribunal for relief from the crudities and inequities of complicated economic legislation.\" ", "36. This decision also is similar to the one in ' v. '. (1940) 310 U S 573 : 84 Law Ed 1368, and is based upon the same principle. ", "37. The learned Advocate General, relied upon certain observations in 'Mo Carter v. ', 80 C L R 432 (Australia). Under a certain transport regulation, Act passed by the State of Victoria no commercial vehicle could operate on public highways unless it had licence. There were detailed provisions prescribing qualifications and conditions under which licences could be granted. One of those conditions was the payment of licence-fee. It was contended that the imposition of a licence fee was a restriction on the right to trade \"absolutely free\" conferred by Section 92 of the Constitution Act. This contention was rejected and it was held that the legislature had power to regulate trade and that Section 92 was inapplicable to such regulations. In that connection made the following observations on which the learned Advocate General relied: ", "\"It has, however, been particularly objected that a power to regulate trade and commerce does not include a power to exclude any person from operations in trade and commerce. But it is obvious that any regulation which imposes conditions upon activities of individuals must exclude from those activities persons who are not prepared, or who are not able for any reason, to satisfy those conditions. In other words all regulations involve some degree of prohibition, and, further, all regulations operate upon persons.\" ", "In that case there were elaborate rules prescribed for granting licence and the held that the discretion of the was not unlimited and arbitrary. In fact the observations quoted above were relied on by the learned Advocate General only to show that the power to regulate carries with it restriction in some form. ", "38. The result of the authorities may thus be summed up. The legislature can confer on a person or body of persons large powers for the purpose of administering the Act. But it must prescribe the principles on which these powers are to be exercised. If there are no rules for guiding and controlling the exercise of discretion by the person or body of persons, then the power must be held to be arbitrary and unreasonable. ", "39. Conformably to the above principles the learned Advocate General sought to establish that the discretion conferred on the Textile Commissioner under Clause 33(3) is not absolute and that in fact it is subject to reasonable limitations. He referred to the orders relating to Cotton Order made in the year 1943; then to the control Order dated 29-4-1944 made under the Defence of India Act; to Clause 18. B which corresponds to the present Clause 30, to the Order of 1945 and to the evolution of All India Yarn distribution scheme. He argued that under Clause 12, Sub-clauses 1 to 3 the year 1944 was taken as the basic period for fixing quotas and it is implicit in Clause 33(3) and Clause 30 that the Textile Commissioner should exercise his powers on the basis of 1944 fixation. But I am unable to read any such limitation or condition in clause 33 (3) and Clause 30. Indeed the counter affidavit takes the position that the orders of the Textile Commissioner are purely administrative and not liable to be questioned in Court. That undoubtedly would be the position in 1948 when the order in question was issued. and the Indian s acting within the spheres allotted to them possessed plenary powers of legislation and the laws enacted by them could not be questioned In any Court on the ground that they deprived a person of his liberty or of his property. It is only with the Constitution that a change came over the situation. The principle of the American Constitution that it was necessary to safeguard the rights of the citizens against the despotism of the legislature was adopted and limitations imposed on the powers of the legislature, the most important of which are those set out in Part in. The subjects have now certain fundamental rights guaranteed to them and it is beyond the competence of the legislature to override them and if they do, the can declare such legislation bad. Now the Cotton Textile Orders were notified under Section 3 (1) of Act 24 of 1946 long prior to the Constitution, under the Influence of a different theory and from a different standpoint and it is not, therefore, a matter for surprise that some of these provisions do not fit in with the pattern of the Constitution. Clause 33 (3) and Clause 30 are survivals of the benevolent despotism of the pre-Constitution and they are inconsistent with the fundamental rights guaranteed under the Constitution. The counter-affidavit is in my opinion a frank admission of this. I am, accordingly of opinion that Clause 33 (3) is opposed to Article 14 and void. ", "40. I shall now deal with Clause 12 (4). The petitioner contends that he has a fundamental right to acquire property under Article 19(1)(f) and to trade under Article 19(1)(g) and that Clause 12 (4) is an infringement of these rights and is, therefore, void. The point to be decided is whether the clause can be held to be saved by Article 19 (5) and (6) as being a reasonable restriction made in the interests of the general public. That the Control Orders have been made in the interests of general public cannot be and has not been controverted, but what is urged is that Clause 13 (4) absolutely prohibits the acquisition of property and, therefore, cannot be upheld as a restriction, much less reasonable restriction on the rights conferred under Article 19(1) Clauses (f) and (g). Reliance was placed on the decision of in ' ', 1950 S C J 571, where it was held that a prohibition on the manufacture of beedies during agricultural season was void as being unreasonable. It may be conceded that the restrictions contemplated by Article 19(5) are such as are incidental to regulation of the rights conferred under Article 19(1)(f) and (g) and that the total prohibition of the rights is not within its scope. But it must be remembered that the Cotton Textiles Control Order is an emergency legislation Introduced for the purpose of regulating supply and demand under abnormal conditions following the termination of the War. It is statedly a temporary measure, its life being extended by successive resolutions of the legislature having due regard to the conditions of the market. ", "41. In Judging of the reasonableness of the prohibition it would be relevant to take into account that it is an emergency legislation of a temporary character. The following observations in ' , 1950 S C J 328 would seem to lend support for the view that the prohibition might be valid. In that case the question was whether an order of externment was a reasonable restriction on the right conferred under Article 19(1)(d). In answering this question in the affirmative , C. J., observed as follows: ", "\"The further extension of the externment order beyond the three months may be for an indefinite period but in that connection the fact that the whole Act is to remain in force up to 14th August 1951 cannot be overlooked.\" ", ", J., observes as follows: ", "\"It is not disputed that under Clause 5 of Article 19 , reasonableness of a challenged legislation has to be determined by a and the decides such matters by applying some objective standard which is said to be the standard of an average prudent man. Judged by such a standard which is sometimes described as an external yard stick the vesting authority in particular officers to take prompt action under emergency circumstances entirely on their own responsibilities or personal satisfaction is not necessarily unreasonable, One has to take into account the whole scheme Of legislation and the circumstances under which the restrictive orders could be made.\" ", "42. In view of these observations I should have had considerable difficulty in holding that Clause 12 (4) standing by itself would be void. But the matter, however, does not rest there. It is argued on be half of the petitioner that Clause 12 (4) does not stand alone that it must be read along with Clause 33 (3) that the latter is invalid as offending Article 14 and that in consequence the former also must be held to be invalid. | ", "43. I agree with this contention. The prohibition on the right to acquire property enacted under Clause 12 (4) and the power to exempt or modify its operation conferred under Clause 33 (3) are inseparable parts of a single scheme of control. Is it likely that the authorities would have enacted such an absolute prohibition as is contained in Clause 12 (4) if they had not also coupled it with a wide power of exemption such as is conferred under Clause 33 (3)? I find it difficult to believe that they would have. And if an absolute prohibition can be justified under Article 19(5) only by the existence of a state of emergency, how is that to be reconciled with the grant of such an absolute power of exemption under Clause 33 (3)? If A is to be prohibited from acquiring power looms on the ground of national emergency, the prohibition, must apply equally to B and C and all the citizens. There cannot be an emergency as regards one citizen and not as regards others. Nor can an argument be founded on the setting of the two provisions under the Control Order. Clause 33 (3) confers a power to exempt not merely in respect of Clause 12 (4), but several other clauses which are all set out in Schedule C. It is as if it were enacted as part of every one of the clauses mentioned in that schedule. The proper view to take of the clauses is to regard them as licencing provisions, providing in substance that properties could be acquired under a licence and that should have the authority to grant such a licence. The validity of Clauses 12 (4) and 33 (3) must then be Judged by the principles applicable to the power to grant licences and, as already mentioned, such a power will be valid only if it is to be exercised in accordance with rules, and where there arc no such rules it must be declared void as repugnant to Article 14. That being my conclusion, I shall have now to consider that relief should be granted to the petitioner. To prohibit from interfering with any acquisition of power looms by the petitioner generally which is what is prayed for in the petition will be too wide a relief to grant, and will amount to a negation of the power of the to enact control regulations in the interests of the public. At the same time, to leave the petitioner without any remedy against the refusal of to grant exemption under Clause 33 (3) would be to withhold protection against the invasion of fundamental rights in exercise of a naked and arbitrary power. To strike a proper balance between the demands of the and the rights of the individuals it is desirable that an order should issue that the application of the petitioner for exemption under Clause 33 (3) should be heard and disposed of by on principles in consonance with Article 14. It is desirable that proper rules should be framed by the administration prescribing the conditions for granting permission and if that is done there will be no ground for complaint under Article 14 and this Court will not interfere with the exercise of discretion 'by , however wide it might be so long as it is within the rules. ", "43-a. The validity of Clause 30 may now be considered. This clause also confers absolute and unlimited powers on the Textile Commissioner. The learned Advocate-General relied on the words \"with a view to securing proper distribution of cloth or yarn\" occurring in Clause 30 as imposing a limitation on the exercise of discretion by the Textile Commissioner, but these words only define the object of the control and not the mode and manner in which such object is to be carried out. This clause is of the same character as Clause 33 (3) and must for the same reasons be held to be raid. ", "44. The question is: what is the relief which should be granted to the petitioner. The prayer in the petition is that the respondent should allot and supply to the petitioner 400 lbs. of yarn per loom per month. For the reasons given by me (in C.M.P. No. 6181 of 1951) I am of opinion that such a relief could not be granted. But the application of the petitioner for supply of yarn should be directed to be considered by the Textile Commissioner and disposed of on principle consonant to Article 14. I, therefore, agree that an order should issue in both the applications in forms mentioned in the judgment of my Lord the Chief Justice. ", "45. Subsequent to the delivery of the judgments in these applications it was brought to our notice by the learned Advocate-General that on 9th July 1951 there was a notification by under which for Clause 30 as it stood before, the following clause was substituted, namely : ", "30 (1) No producer shall sell or deliver any cloth or yarn which has been produced by him except to such person or persons and subject to such conditions as the Textile Commissioner may specify; ", "(2) Without prejudice to the provisions of Sub-clause (1) the Textile Commissioner may, with a view to securing a proper distribution of cloth or yam or with a view to securing compliance with this order, direct any manufacturer or dealer or any class of manufacturers or dealers: ", "(a) to sell to such person or persons such quantities of such description of cloth or yarn as the Textile Commissioner may specify; ", "(b) Not to sell or deliver any cloth or yam of a specified description except to such person or persons and subject to such conditions as the Textile Commissioner may specify. ", "3. The Textile Commissioner may issue such further instructions as he thinks fit in order to carry out the provisions of Sub-clause (1) or any direction under Sub-clause (2). ", "4. Every manufacturer or dealer, to whom a direction or instruction is issued under this clause, shall comply with any such direction or instruction.\" ", "46. We are of opinion that neither the reasoning nor the conclusion in the judgments just delivered is in any way affected by this substitution. ", "47. We certify that the case involves a substantial question of law as to the interpretation of the Constitution and in particular Article 14 and Article 19(1)(f) and (g) read with Article 19(5) and (6)"], "relevant_candidates": ["0000456839", "0000681477", "0000771559", "0001217564", "0001261690", "0001321505"]} {"id": "0001207635", "text": ["ORDER ", "1. The first petitioner , represented by its Secretary, the other petitioners its members challenged the Notification issued by the Commissioner and Special Officer, under S.3(1) of the A.P.Slum Improvement (Acquisition of Land) Act 33 of 1956 (hereinafter called the Act). ", "2. It is averred in the petition that the land was acquired for the purpose of constructing houses and the members have constructed houses at considerable cost and there are disputes about the land and in view of the disputes regarding land, proceedings under S.145 of the Cr.P.C . were initiated and the land was under attachment of the Executive Magistrate under S.146 of the Code and the notification issued by the 1st respondent is illegal as the same was issued without any notice to the petitioners and the 1st respondent has no power to issue notification under the Act and the delegation of the powers by the to the 1st respondent is illegal and the notification declaring the land in question as slum area is also illegal and unjust and the same is liable to be set aside. The application was opposed not only by the Commissioner and but also by some of the parties who were added as party respondents supporting the notification stating that it is highly essential to declare the land in question as slum area and that the petitioners themselves have no right to question the notification. Sr. , the learned counsel for the petitioners mainly argued that the impugned notification is void as opposed to the principles of natural justice and declaring the area in question as a slum area without affording an opportunity is not only adequate but empty. It is also argued that the scheme of the Act does not exclude any opportunity being afforded before issuing notification under S.3(1) and the dicta of the bench in has lost its efficacy in view of the subsequent pronouncements of regarding post decisional opportunities. ", "3. It is necessary to examine the scheme of the Act and also notice the effect of the Full bench on this question. The Act is intended for the acquisition of lands in slum areas and the preamble declares that it was noticed that there are slum areas in almost every town in the State of A.P. which are a source of danger to public health and sanitation and it was felt that I has not been possible to provide for the basic needs of sewerage, water supply and road and side-drains in these slum areas, without causing excessive financial strain on the owners of the lands affected and hence the Act is intended to clear those lands in those areas and undertake the execution of works designed to improve those areas. The Act is made applicable in the entire State of A>P.in 1961 by Act 41 of 1961. S.1(3) enables the Government to apply the provisions of the Act in any Municipality in the State by issuing a notification on such date as the government may by such notification in the appoint. The said section provides that a notice should be issued to the Municipality for not less than two months before issuing the notification. The 'slum area' was defined to mean any area declared to be a slum area under sub-sec.(1) of S.3, Section 3 which is crucial in the present enquiry is in the following terms: ", "\"3.(1) Where the Government are satisfied that any area is or may be a source of danger to the public health, safety or convenience of its neighbourhood by reason of the area being low lying, insanitary, squalid or otherwise, they may by notification in the declare such area to be a slum area. ", "(2) Where the Government are satisfied that it is necessary to acquire any land in a slum area for the purpose of clearing or improving the area, they may acquire the land by publishing in the a notice to the effect that they have decided to acquire it in pursuance of this section. ", "Provided, that, before publishing such notice, the shall call upon the owner of or any other person who in the opinion of the , is interested in such land to show cause why it should not be acquired, and after considering the case, if any, shown by any person interested in the land, the may pass such orders as they deem fit. ", "Explanation: Cause shown by the person interested in the land may be against the declaration of the area as a slum area under sub-sec.(1) as well as against the necessity to acquire the land for the purpose of clearing of improving the area. ", "(3) when a notice as aforesaid is published in the the land shall, on and from the beginning of the day on which the notice is so published, vest absolutely in the Government free from all encumbrances. ", "(4) The Government may, by order, authorise any authority or officer subordinate to them to exercise all or any of the powers conferred and perform all or any of the duties imposed on them by this section, subject to such conditions and restrictions as may be specified in the order.\" ", "S.4 provides that the Government may, either hold the land acquired by them under the Act or hand over to the , S.5 and S.6 provide for right to compensation and the mode of determining the same. The jurisdiction of the civil Court is barred under S.13 S.15 provides that the provisions of the Act can be made applicable to any pending acquisition proceedings. ", "4. S.3(1) was construed by a Full bench of this Court when the constitutional validity of the Act was challenged in . It was held that the provisions of the Constitution. No doubt in that case the learned Judges mainly examined the validity of the Act to find out how far the provisions offend Arts.14 and 31(2) of the Constitution Adverting toS.3 (1) it was held (at P.33):- ", "\"The explanation entitles the person interested in the land to show cause (1) against the declaration of the area as a slum area u/s. 3(1) as well as (2) against the necessity to acquire the land for the purpose of clearing or improving the area. ", "It is true that while proviso to sub-sec. (2) speaks both of the owner as well as of the person interested in the land, but the explanation speaks only of persons interested in the land. We have however no doubt that the expression 'the person interested' would include even the owner of the land. There appears to be no reason as to why the owner should be deprived of an opportunity of objecting both to the declaration u/s 5(1) as well as the intention to acquire the land u/s.3(2) just as a person interested in the land can object. This is just a case of accidental omission but the intention of the is clear from the proviso itself. ", "A close reading of sub-sec. (2) makes it abundantly plain that before a notice under S.3920 is published, it is the statutory duty of the government to call upon the owner and the person interested in the land to show cause. Such a case shall be shown both in regard to the notification u/s.3(1) as well as the necessity to acquire the land. It thus provides opportunity to the owner and the person interested in the land to object to the declaration that it is a slum area, although such opportunity is given only after the declaration.\" ", "5. It is urged by the learned counsel for the petitioner that S.3(1) has not excluded the prior opportunity and in view of the clear dicta of in post decisional opportunity must be confined in case of urgency and the court should always insist on hearing or opportunity at pre-decisional stage unless the statute excluded such hearing. He relied upon the several dictas of in the said case and also the earlier judgment of in , . It is no doubt true that case is a landmark in the Administration Law in the area of natural justice. In that case the Passport of the petitioner was impounded by the u/s.10(3)(c) of the Passport Act 1967 in public interest without giving any prior opportunity. However, after laying down the law when pre-decisional opportunities can be justified they did not pass any formal order setting aside the order of the as the has agreed to provide opportunity of being heard post-decisionally to the passport holder. , , emphasised the requirement of fair play irrespective of the fact whether the enquiry is administrative in character or quasi-judicial. In fact observed in that the dividing line between the administrative power and a quasi-judicial power is quite thin and is being gradually obliterated and hence , observed in case that the law must therefore be taken to be well settled that even in administrative proceedings which involves civil consequences the doctrine of natural justice must be held to be applicable. This view was reiterated in . The learned counsel pressed the dicta in this judgment very much in his favour holding that in that case held that the provisions of the Industries Development and Regulation Act 1951 providing post-decisional opportunity u/s 18-F is not sufficient but a pre-decisional opportunity must be afforded and such pre-decisional opportunity was not excluded by virtue of S.18-AA of the Act. The provisions of the said Act provide two alternative procedures, one u/s.18-A(1)(b) and another u/s. 18-AA(1)(b). Under the former section they can make an enquiry u/s. 15 after giving an opportunity and take over the unit if it is found that the management is highly detrimental to the public interest. But in the latter section which enables the to take without investigation u/s. 15 where immediate preventive action becomes necessary. No doubt under S.18-F post-decisional opportunity is provided under which the has power to cancel the order made earlier. Construing both the provisions by majority held that the pre-decisional opportunity is not excluded. This principle of post-decisional opportunity is again considered in a recent pronouncement of by majority held that the pre-decisional opportunity is not excluded. This principle of post-decisional opportunity is again considered in a recent pronouncement of in , when that was described as abeyance order suspending an import licence was challenged. , , speaking for the court held \"we do not think that it is permissible to interpret any statutory instrument so as to exclude natural justice, unless the language of the instrument leaves no option to the court. Procedural fairness embodying natural justice is to be implied whenever action is taken affecting the rights of parties. It may be that the opportunity to be heard may not be pre-decisional it may necessarily have to be post-decisional where the danger to be averted or the act to be prevented is imminent or where the action to be taken can brook no delay.\" Thus this part of the law is fairly settled and the significant points one should bear in mind are: ", "(1) That the doctrine of natural justice applies both in administrative proceedings and quasi-judicial proceedings which involves civil consequences. ", "(2) Natural justice may be disregarded in an emergency situation where immediate action is necessary. ", "(3) In case of urgency a post-decisional hearing may be given, (4) Whether the hearing is pre-decisional or post-decisional the affected party must be given a reasonable opportunity not being employ public relations exercise. ", "(5) Natural justice may be excluded either by specific or necessary implication. ", "6. Let us apply these principles to the present case. The provisions of the Act 33 of 1956 disclose three stages before the property is vested u/s. 3 of the Act absolutely in the free of all encumbrances. The first stage is issuing a notification u/s. 1(3) in respect of each Municipality making applicable the provisions of the Act after affording an opportunity to such Municipality. The second stage is notification u/s.3(1) declaring an area as slum area. The third and final stage is notification u/s.3(2) acquiring the land. A reading of these provisions makes it clear that opportunity should be provided both before issuing notification u/s. 1(3) and also under S.3(2). The opportunity provided u/s. 3(2) is for both the notifications u/s. 3(1) and also 3(2). The very fact that the explanation enables the person interested to show cause both against S.3(1) notification issued earlier and later notification proposed u/s. 3(2) clearly excludes any opportunity before the notification u/s. 3(1). There cannot be any doubt that if the authorities are satisfied that the earlier notification issued u/s. 3(1) is not well founded. They are bound to rescind the same as the opportunity is provided to the persons interested to show cause both against S.3(1) notification already issued and the proposed notification to be issued u/s. 3(2). Though the dicta of the Full bench in this regard is not specific, I am clearly of the opinion that the Full Bench also took the view that the opportunity is provided to the person interested to show cause against the earlier notification u/s. 3(1) and also latter proposed action u/s. 3(2) and thus if follows the authorities are bound to rescind the orders issued u/s. 3(1) declaring an area as slum area if they are satisfied that the earlier notification does not warrant such action. ", "7. It is argued by the learned counsel that the post-decisional opportunity is employ in this case as the authorities have already made a solemn declaration that the area in question is a slum area and the declaration u/s.3(1) has stigmatised the area of the petitioner as slum area and the civil consequences are so serious and imminent and the notification without giving an opportunity to the petitioner is illegal and opposed to the principles of natural justice and fair play. It is to be noticed that an opportunity was already provided u/s. 1(3) to the Municipality as such before making the provisions of the Act applicable. By virtue of the notification u/s.3(1) no consequences flow. It is only a preliminary step for further proceedings. It is difficult to hold that any civil consequences flow from the notification u/s. 3(1) which requires an opportunity to the petitioners. The mere declaration itself cannot be treated as a civil consequence which requires an opportunity to the petitioners. The principle laid down in . (AIR 1981 SC 8181) is wholly inapplicable. In that case notification u/s. 18(A)(A) completely divests the entire management of the unit and vests the same in the statutory authority. Taking into account such drastic step which beset with several civil if not evil consequences has to hold that s.18-AA does not exclude pre-decisional opportunity and the opportunity afforded post-decisionally u/s. 18(f) of that Act was not sufficient. But in our case no consequences flow by S.3(1) notification till notification u/s.3(2) is issued and the statute provides an opportunity to show cause both against the earlier notification u/s 3(1) and the proposed notification u/s. 3(2). Hence in the absence of any civil consequences no earlier opportunity is necessary for issue of notificationu/s.3(1) which is only preliminary step though a jurisdictional and foundational for the further proceedings. ", "8. Thus I do not find any legal informity in the notification in question for want of opportunity before issuing the notification and it cannot be challenged on the said ground, and consequently this contention fails. ", "9. It is urged by the leaned counsel for the petitioner that the power of u/s.3(1) cannot be delegated to the 1st respondent -Commissioner. For that we have to look to S.3(4) which is already extracted. It is urged that what was contemplated to be delegated is only powers and duties but not the function of the as contemplated u/s3(2). It is urged the satisfaction to be arrived at is that of the Governemnt. Such function cannot be delegated u/s.3(4). As per G.O.ms.No.987 dt 17-11-82 the have delegated their powers under sub-secs.(1) and (2) of S.3 of the Act to the Special Officer, which is in the following terms: ", "\"In exercise of the powers conferred by sub-sec.(4) of S.3 of the A.P.Slum Improvement (Acquisition of Land) Act , 1956 the Governor of A.P. hereby authorise the Special Officer, to exercise the powers, and perform the functions imposed on the Government under sub-sec.(1) and (2) of S.3 of the said Act in respect of the slum areas in the area comprising the .\" ", "I do not think that this distinction between the power and function is justified. Infact power is a larger concept including all its facets of statutory functions. Exercising a statutory power on being satisfied is one of the modes of exercising the power and such power is clearly in the contemplation of sub-sec.(4) and the difference between power and function for the purposes of this question is wholly unjustified and without any substance and I hold that the delegation of power to the 1st respondent by the is well within their jurisdiction and is valid. ", "10. Finally it was urged that thee is no data or material on which a declaration can be made that the area in question is a source of danger to public health, safety or convenience of its neighbourhood by reason of the area being a low lying, insanitary, squalid or otherwise requiring the area to be declared as slum area. No doubt these tests are objective in nature and in a given case this court may examine whether these requirements of objective tests are satisfied though the statute speaks of arriving at the conclusion subjectively. In this case the learned counsel ultimately agreed that this enquiry can be made in the show cause notice issued to them and the authorities are bound to go into the question whether the earlier notification declaring the area as slum area is well founded or not. ", "11. In the result, the writ petition fails and the same is dismissed , but in the circumstances without costs. ", "12. Petition dismissed."], "relevant_candidates": ["0000549062", "0000639803", "0000859161", "0001766147", "0153645174"]} {"id": "0001239949", "text": ["PETITIONER: STATE OF HARYANA Vs. RESPONDENT: & ORS. DATE OF JUDGMENT06/05/1988 BENCH: , L.M. (J) BENCH: , L.M. (J) PATHAK, R.S. (CJ) CITATION: 1988 AIR 1301 1988 SCR (3)1013 1988 SCC (3) 416 JT 1988 (2) 444 1988 SCALE (1)889 CITATOR INFO : F 1990 SC1417 (12) RF 1991 SC 564 (4) ACT: Mines & Minerals (Regulation & Development) Act , 1957- Whether a mining lease can be prematurely terminated in purported exercise of powers under Section 4A of-Without notice to the party affected and opportunity to that party to place its view point-Whether such termination is violative of principles of natural justice. HEADNOTE: These appeals were directed against the common judgment of in Writ applications filed by different petitioners, challenging the termination of the mining leases granted to them. The State of Haryana which had executed the mining leases in favour of the writ petitioners for ten years under the provisions of the Mines & Minerals (Regulation & Development) Act (the Act), terminated the said leases prematurely in the purported exercise of powers under Section 4A of the Act without prior notice to the writ petitioners or any opportunity to them to defend their cases. The leases were so terminated on the ground that -a public sector undertaking-had fully equipped itself to undertake the mining operations. allowed the writ petitions. The State of Haryana and appealed to this by Special leave against the decision of . According to the appellant, the necessary consultation between and was held, fulfilling the conditions under Section 4A of the Act and the decision impugned was taken. The appellant contended that the writ petitioners-lessees had no locus standi to place their view point and it was not necessary to give them notice, and that there was no violation of the principles of natural justice. Dismissing the appeals, the , ^ HELD: The language of Section 4A indicates that the Section by itself does not permaturely terminate any mining lease. A decision in this regard has to be taken by . The question of granting a fresh mining lease in favour of a or a arises only after the existing mining lease is terminated, the section does not direct termination of all mining leases merely for the reason that a Government Company or a has equipped itself for the purpose. It is not correct to say that an existing mining lease can be terminated for the reason that a Government Company or a is ready to undertake the work. Viewed thus, the section must be interpreted to imply that a person who may be affected by such a decision should be afforded an opportunity to prove that the proposed step would not advance the interest of mines and mineral development. Not to do so will be violative of the principles of natural justice. Since there is no suggestion in the section to deny the right of the affected persons to be heard, the provisions have to be interpreted as implying to preserve such a right. A final decision to prematurely terminate a lease can be taken only after notice to the lessee.[1019C-H;1020E] The Writ Petitioners-respondents before the were never given an opportunity to be heard. If such an opportunity had been afforded, they would have shown that their standard of mining operations was very high and favourably measured against the expected standard and was superior to that of the . [1021G] There was no effective consultation between and , and did not form any opinion as required under Section 4A of the Act. The respondents before the were entitled to be heard before a decision to prematurely terminate their leases was taken but they were not given any opportunity to place their cases. The respondents must succeed. [1022A- , 2 SCC 510; , AIR 1987 SC 1802; , AIR 1987 SC 1463 and , etc., 2 SCR 742, referred to. JUDGMENT: ", "CIVIL APPELLATE JURISDICTION: Civil Appeals No.1472-77 of 1987. ", "From the Judgment and Order dated 4.12.1986 of in Civil Writ Petition Nos. 2148 of 1986, 2417, 2173, 2174, 2175 and 2166 of 1986. ", " ", ", and for the Appellant. ", ", , , , , , , , and for the Respondents. ", "The Judgment of the Court was delivered by SHARMA, J. The present appeals by the State of Haryana and are directed against the common judgment of disposing of 6 writ applications filed by different petitioners impleaded as respondent No. 1 herein. ", "2. Separate mining leases were executed on behalf of the State of Haryana with respect to Silica sand and ordinary sand in favour of the writ petitioners for a period of 10 years, in accordance with the provisions of the Mines & Minerals (Regulation & Development) Act , 1957, hereinafter referred to as the Act. The State of Haryana, in purported exercise of powers under Section 4A of the Act prematurely terminated the leases by its order dated 1st October, 1986 which is quoted in the judgment of , stating that it was proper to do so as , respondent No. 4 (appellant No. 2 herein) a public sector undertaking had informed that it had fully equipped itself to undertake the mining operation and that necessary permission in terms of the Section had been obtained from to prematurely terminate the leases. Admittedly no prior notice to the writ petitioners or any opportunity to them to place their case was given. ", "3. The lessees contended before that essential conditions for exercises of the powers under Section 4A are not satisfied in the present cases and further, the impugned decision is violative of the principles of natural justice. It was also urged that so far as the lease in respect of ordinary sand which is a minor mineral under the Act, is concerned, Section 4A being excluded by the provisions of Section 14 is not applicable. It was also averred that forcible possession of the mining areas was taken even before communicating the impugned order. agreed with these contentions and allowed the writ petitions. The State of Haryana and , respondents No. 2 and 4, respectively, in the writ cases were allowed special leave to appeal under Article 136. Hence these appeals. ", " ", "4. Section 4A as it stood at the relevant time read as follows: ", "\"4A.(1) Where , after consultation with , is of opinion that it is expedient in the interest of regulation of mines and mineral development so to do, it may request to make a premature termination of a mining lease in respect of any mineral, other than minor mineral, and, on receipt of such request, shall make an order making a premature termination of such mining lease and granting a fresh mining lease in favour of such company or corporation owned or controlled by as it may think fit. ", "(2) Where , after consultation with , is of opinion that it is expedient in the interest of regulation of mines and mineral development so to do, it may, by an order, make premature termination of a mining lease in respect of any minor mineral and grant a fresh lease in respect of such mineral in favour of such company or corporation owned or controlled by as it may think fit.\" ", "5. Silica sand being a major mineral is governed by Sub-section (1) of Section 4A and ordinary sand by Sub- section (2). According to the appellant, full and necessary consultation between the two Governments i.e. and was held and it was considered expedient in the interest of regulation of mines and mineral development to take the impugned decision. Reference in this regard was made by the learned counsel to the report of referred to in the letters of the Director, , to the Chief Secretary, , dated 20th April, 1985, 8th July, 1985 and 10th July, 1985 and the 's letters dated 14th July, 1986, 17th September, 1986 and 29th September, 1986. It has been contended that since a decision was jointly taken by the two Governments to grant mining lease of the entire area to , this by itself fulfilled the necessary conditions under Section 4A and as the writ petitioners-lessees had no locus standi to place their point of view with respect to this aspect, it was not necessary to give them a notice. The argument is that in the circumstances there is no question of violation of principles of natural justice. It was also claimed that the was the final authority to take a decision under Section 4A with respect to both major and minor minerals. ", "1019 ", "6. Mr. , Additional Solicitor General, stated on behalf of , respondent No. 2 that the respondent is ready to reconsider the matter after hearing the parties concerned. He refuted the claim of the appellant that the is the ultimate authority to take a decision under Section 4A with respect to major minerals and he appears to be right. Sub-section (1) which deals with major minerals empowers to consider the matter and, after having consultation with the Government, to take a decision in this regard and once it does so and makes a request to the Government for prematurely terminating a lease, the Government shall be under an obligation to act. The use of \"shall\" in this context indicates the binding nature of the request. ", "7. The language of Section 4A clearly indicates that the Section by itself does not prematurely terminate any mining lease. A decision in this regard has to be taken by after considering the circumstances of each case separately. For exercise of power it is necessary that the essential condition mentioned therein is fulfilled, namely, that the proposed action would be in the interest of regulation of mines and mineral development. The question of granting a fresh mining lease in favour of a Government Company or a arises only after a decision to terminate the existing mining lease is arrived at and given effect to. The Section does not direct termination of all mining leases, merely for the reason that a Government Company or has equipped itself for the purpose. The Section was enacted with a view to improve the efficiency in this regard and with this view directs consulation between and to be held. The two Governments have to consider whether premature termination of a particulare mining lease shall advance the object or not, and must, therefore, take into account all considerations relevant to the issue, with reference to the lease in question. It is not correct to say that an existing mining lease can be terminated merely for the reason that a Government Company or is ready to undertake the work. ", "8. Considered in this light, the Section must be interpreted to imply that the person who may be affected by such a decision should be afforded an opportunity to prove that the proposed step would not advance the interest of mines and mineral development. Not to do so will be violative of the principles of natural justice. Since there is no suggestion in the Section to deny the right of the affected persons to be heard, the provisions have to be interpreted as implying to preserve such a right. Reference may be made to the observations of this Court in , 2 SCC 510, that where exercise of a power results in civil consequences to citizens, unless the statute specifically out the application of natural justice, such rules would apply. The cases, , AIR 1987 SC 1802; , AIR 1987 1463 and etc., 2 SCR 742, relied upon by Mr. do not help the appellant. The learned counsel placed reliance on the observations in paragraphs 5 to 7 of the judgment in . which were made in connection with legislative activity which is not subject to the rule of audi alteram partem. The principles of natural justice have no application to legislative activities, but that is not the position here. It has already been pointed out earlier that the existing mining leases were not brought to their and directly by Section 4A itself. They had to be terminated by the exercise of the executive authority of the State Government. Somewhat similar was the situation with regard to Section 4A of Haryana Board of School Education Act, 1969 which was under Consideration in , AIR 1987 SC 1463. A matter of policy was adopted and included by the legislature in the impugned section. Besides, the validity of the Section was not under challenge there, as was expressly stated in paragraph 6 of the judgment. So far as the case, is concerned, the learned counsel for the appellant cited it only with a view to emphasise the importance of the mineral wealth of the nation which nobody denies. We, therefore, held that a final decision to prematurely terminate a lease can be taken only after notice to the leassee. ", "9. Coming to the facts of the present case it will be observed that the question of terminating the mining leases in question before us was introduced for the first time under the letter dated 14.7.1986 (page 80) of the State of Haryana. The earlier letter dated 20.4.1985 and 8.7.1985, of , Union of India sent to discussed the general question about the desired improvement in the mining field and referred to the report of on silica sand mining in Haryana. The report had highlighted various aspects of silica sand mining in the State and made several positive suggestions. It was stated in the letter dated 20th April, 1985 that if the lessees did not comply with the requirements mentioned therein, their leases \"deserve to be terminated in accordance with the procedure established under law.\" In the letter dated 8th July, 1985, further emphasis was laid on ensuring scientific mining of optimum utilisation of natural resources, ensuring safety in operation and ensuring payment of fair wages to the mine workers. In this letter the desirability of entrusting mining operations to the public sector was mentioned but it was also stated that the representatives of had in the earlier meetings expressed their inability to entrust (appellant No. 2 before us) with the mining operations in the entire State immediately. Additional terms and conditions were also suggested to be imposed in the future mining leases to be granted in favour of private parties. Later on, it appears that became ready to take over the mining operations and intimated its preparedness by letter dated 10.7.1986 and thereupon the State of Haryana wrote on 14.7.1986 to that it was appropriate to prematurely terminate the 6 leases mentioned in the letter of the date. It will be significant to note that did not take a decision to terminate all the mining leases; on the countrary, fresh mining leases in favour of private individuals were in contemplation of the State authorities, as indicated by the aforementioned letters and by Annexure P-5 (page 273) to the Writ Petition of in . The State's letter dated the 14th July, 1986 was followed by another letter dated 5.9.1986 and in reply to it, asked for a report on several specific points mentioned in their letter which is at page 85 of the paper-book. In place of sending the required information, , in its letter dated 17.9.1986, took the erroneous stand that the information sought for was not relevant. Instead of pointing out that the information demanded was very pertinent in the context of the proposed termination of the mining lease, by its letter dated 26th November, 1986 agreed to the proposal, but took care to advice that while taking any action for premature termination of the leases the authority should \"ensure that the provisions of Section 4A of the Act are complied with\". As has been mentioned earlier, does not deny the right of hearing to the affected lessees and is ready, even now, to give an opportunity to them. Admittedly, the writ petitioners who are respondents before us were never given any such opportunity and according to their assertion if such an opportunity had been afforded, they would have shown that the standard of their mining operation was very high and favourably measured against the expected standard suggested in the report of and mentioned in the letter of the Mines Department of and that it was definitely superior to that of . ", "10. On a consideration of the facts and circumstances of the present case, we are of the opinion that there was no effective consultation between and , and did not form any opinion as required under Section 4A of the Act. We are further of the view that the lessees, the respondents before us, were entitled to be heard before a decision to prematurely terminate their leases was taken but they were not given any opportunity to place their case. ", "11. Mr. , the learned counsel for the respondents, very fairly stated that he could not support the plea that leases in respect of minor minerals are saved from the application of Section 4A altogether by reason of Section ", "14. This Court in , 2 SCR 742 (at pages 746H and 747A) pointed out that perhaps since Section 4A(1) is inapplicable to minor minerals because of the provisions of Section 14 , Section 4A(2) has been specially enacted making somewhat similar provision. It must, therefore, be held that leases in respect of minor minerals also can be prematurely terminated in appropriate cases. However, in view of our earlier finding the respondents must succeed. We accordingly dismiss these appeals with costs. ", "S.L. Appeals dismissed."], "relevant_candidates": ["0001162682", "0001233720", "0001646640", "0001901740"]} {"id": "0001247083", "text": ["PETITIONER: STATE OF MADHYA PRADESH(NOW MAHARASHTRA) Vs. RESPONDENT: HAJI HASAN DADA DATE OF JUDGMENT: 02/12/1965 BENCH: , : , J.C. , K. SIKRI, S.M. CITATION: 1966 AIR 905 1966 SCR (2) 854 CITATOR INFO : RF 1986 SC1556 (24) ACT: C.P. and Berar Sales-tax Act (21 of 1947), s. claim for refund--When can be ordered. HEADNOTE: The respondent was assessed to tax by the Assistant Commissioner of Sales-tax under the C.P. and Berar Sales-tax Act, 1947 on the turnover ,of his business and he paid the tax. After the order of assessment gave a ruling that dyeing charges were not taxable under the Act. The respondent applied to the Assistant Commissioner, under s. 13 before its amendment in 1953 for refund, on the plea that the amount ,claimed represented dyeing charges included in his turnover. The Assistant Commissioner rejected the application, but ordered the case to be returned to the Commissioner for examination of the claim for refund on merits. At the instance of the State, the Board referred to , the question whether there was any bar to the examination on merits of claims for refund under s. 13 as originally ,enacted. held that there was no bar.In appeal to this Court, HELD:The application for refund of tax was not 'maintainable under the section as originally framed. The Assistant Commissioner is, within the limits of his jurisdiction and authority, competent to decide all questions which arise before him; his orders are liable to be set aside in appeal or modified in revision. But under the Act, the Assistant Commissioner-who exercises the powers of the Commissioner-has no power to review his decision, and so long as his order is not set aside or modified,, a dealer cannot call upon him to ignore the previous order and grant refund contrary to the plain direction of his order. [857 C, H] Commissioner of Income-tax v. Tribune Trust L.R. 74 I.A. 306 applied. JUDGMENT: ", "CIVIL APPELLATE JURISDICTION : Civil Appeal No. 1007 of 1964. ", "Appeal by special leave from the judgment and order dated September 13, 1961, of (Nagpur Bench) in Civil Reference No. 1 of 1961. ", " and , for the appellant. The respondent did not appear. ", "The Judgment of the Court was delivered by , J. By order dated April 17, 1952, the respondent was assessed by the Assistant Commissioner of Sales Tax, Nagpur Region, to pay tax under the Central Pro- ", " ", "vinces & Berar Sales Tax Act 21 of 1947 on the turnover from his business in yam for the period November 13, 1947 to November 1, 1948. The respondent paid the amount of tax assessed on July 8, 1952. Thereafter relying upon s. 13 of the C.P. & Berar Sales Tax Act, 1947 he applied on November 20, 1952 to the Assistant Commissioner of Sales Tax for an order refunding Rs. 873/10/- on the plea that in the turnover of his business were included dyeing charges which were not taxable under the Act, and which since the order of assessment were held by to be not taxable. The Assistant Commissioner rejected the application, and the order was confirmed by the Commissioner of Sales Tax in appeal. , Madhya Pradesh, however, set aside the order and ordered that the case be returned to the Commissioner \"for disposal afresh in the light of the legal principles explained in Sheikh of Balaghat v. The (1)\". During the pendency of the proceedings before the taxing authorities, s. 13 of the Act was amended with retrospective effect. It is claimed by the that under the amended section the right to obtain refund in cases similar to those under examination was. taken away retrospectively. The of Madhya Pradesh moved r for a reference under s. 23 of the Act to , and referred the following three questions : ", "\"1. Is ruling 57 (in Sheikh 's case-3 S.T.C. 331) good law ? In other words, was the right in holding that decision in . Trust (A.I.R. 1948 P.C. 102) constituted no bar to the examination on merits of claims for refund made under the original section 13 of the Sales Tax Act XXI of 1947 within the time-limit mentioned in it ? ", "2. Has section 24 of Act XX of 1953 been validly enacted, in so far as it seeks to give retrospective effect to the amended section 13 of Act XXI of 1947-as from the very commencement of the latter on 1-6-47 ? and ", "3.If the answer to question No. 2 is in the affirmative, does sub-section (3) of the new section 13 constitute a bar to the examination on merits of the claim for refund made by the assessee in the present case ?\" ", "(1) 3 S.T.C. 331. ", "L8Sup.CI/66-8 held that by s. 13 of the Act as originally enacted, the respondent had \"a valuable right to ask for refund of the amount of the tax paid by him in excess of the amount lawfully due\" and that \"the right to obtain a refund being a substantive right given to the respondent by the statute and not being a matter of mere procedure\", this right could not be taken away except by clear and unambiguous words, and S. 13 as amended was not legislation which satisfied that test. accordingly answered the questions as follows : ", "\"1. Ruling No. 57 is good law, and, in our opinion, the was right. ", "2. Section 24 of Act XX of 1953 has been validly enacted. ", "3. The new section 13 sub-section (3), does not bar an examination on merits of the claim for refund made on 20-11-1952 by the assessee.\" ", "With special leave, the State of Maharashtra, upon whom the rights of the State of Madhya Pradesh have devolved by virtue of the States Reorganisation Act , 1956, has appealed to this ,.Court. ", "We are of the view that the first question alone need be answered in this appeal, and on the answer we propose to record the claim made by the respondent must stand rejected. Section 13 of the Act, as originally enacted, and which applied during the ,year of assessment, read as follows : ", "\"The Commissioner shall, in the prescribed manner and either 'by cash payment or, at the option of the dealer, by deduction of such excess from the amount of tax due in respect of any other period, refund to a registered dealer applying in this behalf any amount of tax or penalty paid by such dealer in excess of the amount due from him under this Act. Provided that no claim for refund shall be allowed unless it is made within twelve months from the date on which the order of assessment with or without penalty was passed or within six months from the date on which the final order is passed on appeal, revision, review or reference in respect of the order of assessment with or without penalty.\" ", "The amendment to S. 13 by Act XX of 1953 need not, for reasons already set out, be considered. ", "857 ", "Section 13 , in terms authorised the Commissioner to grant refund to a registered dealer applying in that behalf, of any amount of tax or penalty paid by such dealer in excess of the amount due from him under the Act. The section implies that refund may be granted only of the amount which is not lawfully due, and whether a certain amount is lawfully due or not, must be determined by the Assistant Commissioner in making the order of assessment or re- assessment. The order of the Assistant Commissioner is undoubtedly not final : it is liable to be set aside in appeal or modified in a revision application under the provisions of the Act. But so long as the order passed by the Assistant Commissioner is not so set aside or modified, a dealer cannot call upon him to ignore the previous order, and grant refund contrary to the plain direction of the order. ", "There is abundant authority for the view that until it is set aside by appropriate proceedings under the Act which authorises the levy of tax, full effect must be given to an order of assessment, even if it be later found that the order was erroneous in law : e.g. Commissioner of Income Tax, Punjab, North-West Frontier and Delhi Provinces, Lahore v. , Lahore(1). In that case the which had been in previous years assessed to, and had paid, income-tax, claimed in respect of its assessment for the year 1932-33 that it was exempt from taxation. In appeal which was carried to , the contention was upheld. Before the judgment of was pronounced, assessments to income-tax were made on the for the years 1933-34 to 1938-39. After the 's decision, the applied to the Commissioner of Income- tax for an order for refund of income-tax. held in a reference under s. 66(3) of the Indian Income-tax Act that the assessments made for the years 1933- 34 to 1938-39 \"were a nullity\", and that the could not be denied the relief. reversed the order of and held that the assessments which were duly made by the Income-tax Officer in the proper exercise of his duty were validly made and were effective until they were set aside. ", "The Assistant Commissioner appointed under the Act is within the limits of his jurisdiction and authority competent to decide all the questions which arise before him : his orders, it is true, are liable to be set aside in appeal or modified in revision as provided by the Act. But under the Act the Assistant Commissioner who exercises the powers of the Commissioner-has no power to (1) L.R. 74 I.A. 306. ", "858 ", "review his decision, nor is he authorised to ignore his previous order, and to pass an order for refund inconsistent with his previous order which has not been set aside by appropriate proceedings. ", "It is somewhat unfortunate that a later decision of in (1)-a case arising under S. 13 of the Bombay Sales Tax Act, 1946-which decided the identical question which arose in this appeal, was not brought to the notice of . In that case it was held by that an application for refund of sales tax paid under an order of assessment cannot be entertained by the Sales Tax Officer on the plea that the order was made on an erroneous view of the law, unless the order was set aside in appropriate proceedings by way of appeal or revision. The in that case in a reference made under the Bombay Sales Tax Act disapproved of the view of which had in arriving at its decision followed the precedent in Sheikh case (2). Application for refund of tax was, therefore, not maintainable under s. 13 of the C.P. & Berar Sales Tax Act, 1947 as originally framed. ", "The appeal must therefore be allowed. The parties to bear their own costs in this and in the High . Appeal allowed. ", "(1) 8 S.T.C. 379. (2) 3 S.T.C. 331. ", "859"], "relevant_candidates": ["0000177466", "0000541578"]} {"id": "0001281050", "text": ["PETITIONER: SHETTY Vs. RESPONDENT: THE INTERNATIONAL AIRPORT AUTHORITY OF INDIA AND ORS. DATE OF JUDGMENT04/05/1979 BENCH: , P.N. BENCH: , P.N. TULZAPURKAR, V.D. , R.S. CITATION: 1979 AIR 1628 1979 SCR (3)1014 1979 SCC (3) 489 CITATOR INFO : R 1980 SC 840 (15,16,20) F 1980 SC1992 (10) F 1980 SC2147 (63) R 1981 SC 212 (18,31,32,34,36,37,38,39,41,42 E&R 1981 SC 487 (8,9,16) R 1981 SC1694 (5) R 1981 SC2001 (6,7) MV 1982 SC1325 (12) R 1983 SC 130 (16) R 1983 SC 624 (8) F 1983 SC 848 (11) R 1983 SC1235 (8) R 1984 SC 363 (22) D 1984 SC 415 (6) F 1984 SC 541 (13) R 1984 SC 657 (16) R 1984 SC1420 (5) F 1985 SC1147 (12) RF 1986 SC 180 (41) RF 1986 SC 872 (71) RF 1986 SC1035 (12) RF 1986 SC1370 (10) RF 1986 SC1527 (12,19,23) R 1986 SC1571 (52,54,69,105) E&R 1987 SC 251 (23) E 1987 SC1080 (12,TO,17,26,28,29,30) R 1987 SC1109 (30,35,36) RF 1988 SC 157 (8,9,10) RF 1988 SC 268 (30) R 1988 SC 469 (7,8,10,TO,12) APL 1989 SC 88 (7) D 1989 SC1031 (12) D 1989 SC1076 (11,19,20) F 1989 SC1629 (13,14) F 1989 SC1642 (25,27) D 1989 SC2138 (64,100) RF 1990 SC1277 (46) RF 1990 SC1480 (29) R 1991 SC 101 (237,257,263) RF 1991 SC 537 (29) RF 1991 SC1153 (12) RF 1991 SC1173 (5) D 1991 SC1579 (6) RF 1992 SC 1 (133) RF 1992 SC 76 (2) F 1992 SC1858 (19) ACT: International Airport Athority Act 1971-Whether an instrumentality of - called for tenders for a job-If could accept a tender not conforming to conditions in notice. Administrative law-Statutory body-When an instrumentality of . HEADNOTE: The first respondent, by a public notice, invited tenders for putting up and running a second class restaurant and two snack bars at the International Air port, Bombay. the notice stated in Paragraph (1) that sealed tenders in the prescribed form were invited from registered second class hoteliers having at least five years' experience for putting up and running a second class restaurant and two snack bars at the Bombay Airport for a period of three years Paragraph (8) stated that acceptance of the tender would rest with the Airport Director who does not bind himself to accept any tender and reserves to himself the right to reject all or any of the tenders received without assigning any reasons therefor. out of the six tenders received only the tender of the 4th respondents was complete and offered the highest amount as licence fee. All the other tenders were rejected because they were incomplete. Since the fourth respondents did not satisfy the description of \"registered second class hoteliers having at least S years' experience\" prescribed in para graph (1) of the tender notice, the 1st respondent called upon the fourth respondents to produce documentary evidence whether they were registered second class hotliers having at least 5 years' experience. The fourth respondents stated once again that they had considerable experience of catering for various reputed commercial houses, clubs, messes and banks and that they had (Canteen) Licence. Satisfied with the information given by the fourth respondents, the first respondent accepted their tender on the terms and conditions set out in its letter. The appellant filed a writ petition before challenging the decision of the first respondent in accepting the tender of the fourth respondents. But it was rejected. In appeal to this Court it was contended on behalf of the appellants that (1) the first respondent which is a public authority was bound to give effect to the most important condition of eligibility and acceptance of the tender by the first respondent was in violation of the standard or norm of eligibility set up by the first respondent and (2) had the appellant known that non- fulfilment of the condition of eligibility would be no bar for considering a tender he too would have competed for obtaining the contract. 1015 The fourth respondents, on the other hand, contended that the requirement A that the tenderer must be a registered second grade hotlier was meaningless because the grading is given by only to hotels or restaurants and not to persons running them and, therefore there could be no second grade hotlier; (2) the notice setting out the conditions of eligibility having had no stautory force, even if there was a departure from the standard or norm of eligibility, it was not justiceable and the first respondent was competent to give the conract to anyone it thought fit; and (3) reserved to itself the right to reject all or any of the tenders without assigning any reasons and, therefore, it was competent to it to reject all the tenders or negotiate with any person it considered fit to enter into a contract. ^ HELD: The action of the first respondent in accepting the tender of the fourth respondents, who did not satisfy the standard or norm, was clearly discriminatory since it excluded other persons similarly situate from tendering for the contract and it was arbitrary and without reason. Acceptance of the tender was invalid as being violative of the equality clause of the Constitution as also of administrative law inhibiting arbitrary action. [1056C] (a) What paragraph ( 1 ) of the notice required was that only a person running a registered second class hotel or restaurant and having at least 5 years' experience as such should be eligible to submit the tender. The test of 1) eligibility laid down in this paragraph was an objective test and not a subjective one. If a person submitting the tender did not have atleast five years' experience of running a second class hotel, he was eligible to submit the tender and it would not avail him to say that though he did not satisfy this condition he was otherwise capable of running a second class restaurant and therefore should be considered. This was in fact how the first respondent understood this condition of eligibility. The first respondent did not regard this requirement as meaningless or unnecessary and wanted to be satisfied that the fourth respondents had fulfilled this requirement. The fourth respondents were neither running a second grade hotel or restaurant nor did they have five years' experience of running such a hotel or restaurant. Therefore the fourth respondents did not satisfy the condition of eligibility laid down in paragraph(l) of the noice. [1028 B-H] (b) It is not possible to justify the action of the first respondent on the ground that it could have achieved the same result by rejecting all the tenders and entering into direct negotiations with the fourth respondents Although there was no statutory or administrative rule requiring the first respondent to give a contract only by inviting tenders and that on the terms of paragraph 8 of the tender notice, it was not bound to accept any tender, the first respondent did not reject the tenders outright and enter into direct negotiation with the fourth respondents for awarding the contract. The process of . awarding a contract by inviting tenders was not terminated or abandoned by the first respondent by rejecting all the tenders but in furtherance of the process the tender of the fourth respondents was accepted by the first respondent. Nor was the contract given to the fourth respondents as a result of direct negotiations. [1029 D-G] 2(a) Today with tremendous expansion of welfare and social service functions, increasing control of material and economic resources and large scale assumption of industrial and commercial activities by the , the power of 1016 the executive to affect the lives of the people is steadily growing. The attainment of socio-economic justice being a conscious end of policy, there is a vast and inevitable increase in the frequency with which ordinary citizens come into relationship of direct encounter with power-holders. This renders it necessary to structure and restrict the power of the executive so as to prevent its arbitrary application or exercise. Whatever be the concept of the rule of law, there is substantial agreement in juristic thought that the great purpose of the rule of law notion is the protection of the individual against arbitrary exercise of power, wherever it is found. It is unthinkable that in a democracy governed by the rule of law the executive or any of its officers should possess arbitrary power over the interests of the individual. Every action of the executive must be informed with reason and should be free from arbitrariness. That is the very essence of the rule of law and its bare minimal requirement. And to the application of this principle it makes no difference whether the exercise of the power involves affectation of some right or denial of some privilege. [1031 F-H] (b) To.day the , in a welfare ? is the regulator and dispenser of special services and provider of a large number of benefits. The valuables dispensed by take many forms, but they all share one characteristic. They are steadily taking the place of traditional forms of wealth. These valuables which derive from relationships to are of many kinds: leases, licences, contracts and so forth. With the inereasing magnitude and range of governmental functions as we move closer to a wefare , more and more of our wealth consists of these new forms. Some of these forms of wealth may be in the nature of legal rights but the large majority of them are in the nature of privileges. But on that account, it cannot be said that they do not enjoy any legal protection nor can they be regarded as gratuity furnished by the so that the may withhold, grant or revoke it at its pleasure. [1032 E-H] (c) The law has not been slow to recognize the importance of this new kind of wealth and the need to protect individual interest in it and with that end in view, it has developed new forms of protection. Some interests in largess, formerly regarded as privileges, have been recognized as rights while others have been given legal protection not only by forging procedural safeguards but also by confining/structuring and checking discretion in the matter of grant of such largess. The discretion of the has been held to be not unlimited in that the cannot give or withhold largess in its arbitrary discretion or at its sweet will. [1033 C-D] Viterolli v. 359 U.S. 535: 3 Law Ed. (Second Series) 1012, , 2 SCR. 674 referred to. (d) Therefore, where the is dealing with the public, whether by way of giving jobs or entering into contracts or issuing quotas or licences or granting other forms of largess. the cannot act arbitrarily at its sweet will and, like a private individual, deal with any person it pleases, but its action must be in conformity with standard or norm which is not arbitrary, irrational or irrelevant. The power or discretion of the in the matter of grant of largess including award of jobs, contracts etc., must be con fined and structured by rational, relevant and non-discriminatory standard or norm and if the departs from such standard or norm in any particular case or cases, the action of the would be liable to be struck 1017 down. unless it can be shown by the that the departure was not arbitrary, but was based on some valid principle which in itself was non-irrational, unreasonable or discriminatory. [1034 F-H] (e) The which represents the executive authority of the may act through the instrumentality or agency of natural persons or it may employ the instrumentality or agency of JURIDICAL persons to carry out its functions. With the advent of the welfare state the civil service, which traditionally carried out functions of through natural persons, was found inadequate to handle the new tasks of specialised and highly technical character. To fill the gap it became necessary to forge a new instrumentality or administrative device for handling these new problems and that is done by public corporations which has become the third arm of the . They are regarded as agencies of the . In pursuance of the industrial policy resolution of the of India corporations were created by the for setting up and management of public enterprises and carrying out public function. The corporations so created, acting as instrumentality or agency of , would obviously be subject to the same limitations in the field of constitutional and administrative law as itself though in the eye of law they would be distinct and independent legal entities. It . acting,, through its officers is subject to certain constitutional and public law. limitations, it must follow a fortiori that , though the instrumentality or agency of corporations, should equally be subject to the same limitations. But the question is how to determine whether a corporation is acting is instrumentality or agency of . [1035A-C, F-H] 3(a ) The factors for determining whether a corporation has become an instrumentality or agency of the are: does the give (my financial assistance and if so that is the magnitude of such assistance ? Is there any control of the management and policies of the corporation by the , and what is the nature and extent of such control? Does the corporation enjoy any conferred or protected monopoly status and whether the functions carried out by the corporation are pubic functions closely related to governmental functions? It is not possible to particularise all the relevant factors but no single factor will yield a safisfactory answer, to the question and the court will have to consider the cumulative. effect of these various factors and establish it by its decision on the basis of a particularised enquiry into facts and circumstances of each case. [1041 B-E] (b) v. 3 S.C.R. 619 at 658 explained, v. , 149 F. 2d 212, v. 419 U.S. 345, 42 L.ed. 2d 477, v. 382 U.S. 296; 15 L.ed. 2d 373, v. 1 Ch. 614, New York v. United 326 U.S. 572, Cf. v. 304 U.S. 405 426, 427 referred to. (c) Where a corporation is an instrumentality or agency of it would be subject to some constitutional or public law limitations ns . The rule inhibiting arbitrary action by must apply equally where such corporation is dealing with the public and it cannot act arbitrarily and c into relationship with any person it likes at its sweet will. Its action must be in conformity with some principles which meets the test of reason and relevance. [1041 H] 9-409 SC1/79 1018 3 S.C.R. 377, and v. [19751 3 S.C.R. 619 at 658 followed. (1969] 3 S.C.R. 773, 3 S.C.R. 995, 3 SCR 363, Sarbhajit Tewari v Union of lndia & Ors. 1 SCC 485; held inapplicable. (d) It is well established that Art. 14 requires That action must not be arbitrary and must be based on some rational and relevant principle which is non-discriminatory. It must not be guided by extraneous or irrelevant considerations. The cannot act arbitrarily in enter into relationship, contractual or otherwise, with a third party. Its action must conform to some standard or norm which is rational and non-discriminatory. [1042 2 SCR 348, 2 S.C.R. 621, 3 S.C.R. 374, S.C.R. 78, referred to, of orissa & ors. [1971 3 S.C.R. 153, . 2 S.C.R. 36, 3 S.C.R. 377, Praga Tools Corporation Dv. c. A. Imanuel 3 S.C.R. 773, 3 SCR, 995, 3 SCR. 363, Sarbhajit Tewari v. Union of India & ors. 1 SCC 485, held in applicable. 4(a) The International Airport Act, 1971 empowers the Central to constitute an authority called . The salient features of the Act are: the Anthority, which is a body cor porate having perpetual succession and a common seal, consists of a Chairman and certain other Members who are appointed by the Central . The Central has power to terminate the appointment or to remove a member from the Board of the . Although the has no share capital of its own, capital needed by it for carrying out its functions is provided wholly by the Central . All non-recurring, expenditure Incurred by the Central for or in connection with the purposes of the airports upto the appointed date and declared to be capital expenditure by the Central shall be treated as capital provided by the Central to the first respondent and all sums of money due to the Central in relation to the airports immediately before the appointed date shall] be deemed to be due to the first respondent. The functions, which until the appointed date were being carried out by the General , were Transferred to the Airport Athority by virtue of s. 16. The first respondent, according to s. 20, should pay the balance of its annual net profits to the Central after making provision for reserve funds, bad and doubtful debts, depreciation in assets and so on. The first respondent, under s. 21, has to submit for the approval of the Central a statement of the programme of its activities during the forthcoming financial year. Its accounts are audited by the Comptroller and Auditor General and the accounts Shall be forwarded to the Central . The first respondent is required to submit an account of its activities during a financial year and this report is laid before by the Central . The Central has power to divest the first respodent temporarily from 1019 the management of any airport and direct ut to entrust such management to any other person. Power is conferred under s. 34 on the Central to supersede the first respodent under certain specified circumtances. Section 35 gives power to the Central to give directions in writing to the Airport on questions of policy and the Airport is bound by such directions. Section 37 empowers the Airport to make regulations. Section 39 provides that contravention of any regulation made by the Airport is punishable. [1052B-1054C] (b) A conspectus of the provisions of the Act clearly shows that every test l down by this Court in deciding whether a statuority authority comes within the purview of Art. 12 of the constitution is satisfied in the case of the first respondent. they leave no room for doubt that it is an instrumentality or agency of the Central and falls within the definition of . Therefore, having regard both to the constitutional mandate of Art. 14 and the judicially evolved rule of administrative law, the first respendent was not entitled to act arbitrarily in accepting the tender of the fourth respondents but was bound to conform to the standard or norm did down in paragraph I of tho notice inviting tenders. The standard or norm laid down by the notice was reasonable and non-discriminatory and once it is found that such a standard or norm is laid down, the first respondent was not entitled to depart from it and award the contract to the fourth respondents who did not satisfy the condition of eligibility prescribed by standard or norm. If none of the tenderer satisfied the condition the first respondent could have rejected the tender and invited fresh tenders on the basis of less stringent standard or norm, but it could not depart from the prescribed standard or norm. [1055 E-A] (c) In the instant case the appellant had no real interest in the result of the litigation. There can be no doubt that the litigation was commenced by the appellant not with a view to protection his own interest, but had been put up by others for depriving the fourth respondents of the benefit of the contract secured by them. The Writ Petition was filed more than five months after the acceptance of the tender and the position would have been different had tho appellant filed it immediately after the acceptance of the tender. The Fourth respondents have incurred a large expenditure in making necessary arrangement under the bona fide belief that their tender had been legally and validly accepted. It would be most inequitous to set aside the contract at the instance of the appellant JUDGMENT: ", "CIVIL APPELLATE JURISIDICTION: Civil Appeal No. 895 of 1978. ", "Appeal by Special Leave from the Judgment and order dated 23-1-1978 of at Bombay in Appeal No. 234/77 arising out of Misc. Petition No. 1582/77. ", ", , , and . for the Appellant. , o. c. Mathur and for Respondent No. 1. ", "1020 ", ", , , and . V. Desai for Respondent No. 4. ", "The Judgment of the Court was delivered by BHAGWATI, J.-This appeal by special leave raises interesting questions of law in the area of public law. What are the constitutional obligations on the when it takes action in exercise of its statutory or executive power? Is the entitled to deal with its property in and manner it likes or award a contract to any person it chooses without any constitutional limitations upon it? What are the parameters of its statutory or executive power in the matter of awarding a contract or dealing with its propery ? The questions fell in the sphere of both administrative law and constitutional law and they assume special significance in a modern welfare which is com mitted to egalitarian values and dedicated to the rule or law. But these questions cannot be decided in the abstract. They can be determined only against the back-ground of facts and hence we shall proceed to the facts giving rise to the appeal. ", "On or about 3rd January, 1977 a notice inviting tenders for putting up and running a second class restaurant and two Snack bars at the International Airport Bombay was issued by the 1st respondent Which is a corporate body constituted under the International Airport Authority Act, 43 of 1971. The notice stated in the clearest terms in paragraph (1) that \"Sealed tenders in the prescribed form are here by invited from Registered IInd Class Hoteliers having at least 5 years' experience for putting up and running a IInd Class Restaurant and two Snack bars at this Airport for a period of 3 years\". The latest point of time upto which the tenders could be submitted to the 1st respodent was stipulated in Paragraph 7 of the notice to be 12 p.m. On 25th January, 1977 and it was provided that the tenders would be opened on the same date at 12.30 hours. Paragraph (8) of the notice made it clear that \"the acceptance of the tender will rest with the Airport Director who does not bind himself to accept any tender and reserves to himself the right to reject all or ally of the tenders received without assigning any reasons therefore \" There were six tenders received by the 1st respondent in response to the notice and one of them was from the 4th respondents of offering a licence fee of Rs. 6666.66 per month, and the others were from , , one , and offering progressively decreasing licence fee very much lower than that offered by the 4th respondents. The tenders were opened in the office of the Airport Director at 12.30 p.m. On 25th January, 1977 and at that time the 4th respondents were represented by their sole proprietor . was present on behalf of himself, , and and there was one representative of . The tenders of , , and were not complete since they were not accompanied by the respective income tax certificates, affidavits of immovable property and solvency certificates, as required by cl. (9) of the terms and conditions of the tender form. The tenders of was also not complete as it was not accompanied by an affidavit of immovable property held by him and solvency certificates. The only tender which was complete and fully complied with the terms and conditions of the tender form was that of the 4th respondents and the offer contained in that tender was also the highest amongst all the tenders. Now it is necessary to point out at this stage that while submitting their tender the 4th respondents had pointed out in their letter dated 24th January, 1977 addressed to the Airport Director that they had 10 years' experience in catering to reputed commercial houses, training centres, banks and factories and that they were also doing considerable outdoor catering work for various institutions. This letter showed that the 4th respondents had experience only of running canteens and not restaurants and it appeared that they did not satisfy the description of \"registered IInd Class Hotelier having at least 5 years' experience\" as set out in paragraph (1) of the notice inviting tenders. The Airport officer, therefore, by his letter dated 15th February, 1977 requested the 4th respondents to inform by return of post whether they were a \"registered IInd Class Hotelier having at least 5 years experience\" and to produce documentary evidence in this respect within 7 days. The 4th respondents pointed out to the Airport officer by their letter dated 22nd February, 1977 that they had, in addition to what was set out in their earlier letter dated 24th January, 1977, experience of running canteens for and and moreover, they held granted by since 1973 and had thus experience of 10 years in the catering line. It appears that before this letter of the 4th respondents could reach Airport officer, another letter dated 22nd February, 1977 was addressed by the Airport officer once again requesting the 4th respondents to produce documentary evidence to show if they were ''a registered Ilnd Class Hotelier having at least 5 years experience\". The 4th respondents thereupon addressed another letter dated 26th February, 1977 to the Director pointing out that they had considerable experience of catering for various reputed commercial houses, clubs, messes and banks and They also held an Eating House Catering Establishment (Canteen) Licence as also a licence issued under the Prevention of Food Adulteration Act . The 4th respondents stated that their sole proprietor had started his career in catering line in the year 1962 at Hotel Janpath, Delhi and gradually risen to his present position and that he had accordingly \"experience equivalent to that of a IInd Class or even 1st Class hotelier.\" This position was reiterated by the 4th respondents in a further letter dated 3rd March, 1977 addressed to the Director. This information given by the 4th respondents appeared to satisfy the 1st respondent and by a letter dated 19th April, 1977 the 1st respondent accepted the tender of the 4th respondents on the terms and conditions set out in that letter. The 4th respondents accepted these terms and conditions by their letter dated 23rd April, 1977 and deposited with the 1st respondent by was of security a sum of Rs. 39,999.96 in the form of fixed Deposit Receipts in favour of the respondent and paid to the 1st respondent a sum of Rs. 6666.66 representing licence fee for one month and other amounts representing water, electricity and conservancy charges. The 4th respondents thereafter executed and handed over to the respondent an agreement in the form attached to the tender on 1st May, 1977. The 4th respondents also got prepared furniture, counters and showcases as also uniforms for the staff, purchased inter alia deep freezers, water coolers, electrical appliances, icecream cabinets, espresso coffee machines, crockery, cutlery and other articles and things and also engaged the necessary staff for the purpose of running the restaurant and the two Snack bars But the respondent could not hand over possession of the requisite sites to the 4th respondents, since was running his restaurant and snack bars on these sites under a previous contract with the 1 st respondent and though that contract had come to an end, did not deliver possession of these sites to the respondent. The 4th respondents repeatedly requested the 1st respondent and the Airport Director who is the 2nd respondent in the appeal, to hand over possession of the sites and pointed out to the that the 4th repondents were incurring losses by reason of delay in delivery of possession, but on account of the intransigence of the respondent could not arrange to hand over possession of the sites to the 4th respondents. ", "Meanwhile one who owned Cafe Excelsior filed Suit No. 6544 of 1977 in , Bombay against the respondents challenging the decision of the respondent to accept the tender of the 4th respondents and took out a notice of motion for restraining the 1 st respondent from taking any further steps pursuant to the acceptance of the tender. obtained an ad- interim injunction against the respondents but after hearing the respondents, vacated the ad-interim injunction and dismissed the notice of motion by an order dated 10th october, 1977. An appeal was preferred by against this order, but the appeal was dismissed by on 19th october, 1977. Immediately thereafter, on the same day, the respondent handed over possession of two, sites to the 4th respondents and the 4th respondents proceeded to set up snack bars on the two sites and started business of catering at the two snack bars. These two sites handed over to the 4th respondents were different from the sites occupied by , because refused to vacate the sites in his occupation. So far as the site for the restaurant was concerned, the respondent could not hand over the possession of it to the 4th respondents presumably because there was no other appropriate site available other than the one occupied by . Since refused to hand over possession of the sites occupied by him to the respondent, even though his contract had come to an end, and continued to carry on the business of running the restaurant and the snack bars on these sites, the respondent was constrained to file suit No. 8032 of 1977 against in at Bombay and in that suit, an injunction was obtained by the 1st respondent restraining from running or conducting the restaurant and the snack bars or from entering the premises save and except for winding up the restaurant and the snack bars. preferred an appeal against the order granting the injunction, but the appeal was rejected and ultimately a petition for special leave to appeal to this Court was also turned down on 31st July, 1978. ", "This was, however, not to be the end of the travails of the 4th respondents. for, as soon as the appeal preferred by against the order dismissing his notice of motion was rejected by on 19th October, 1977, filed another suit being suit No. 8161 of 1977 in , Bombay on 24th October,1977 seeking mandatory injunction for removal of the two snack bars put up by the 4th respondents. This was one more attempt by to prevent the 4th respondents from obtaining the benefit of the contract awarded to them by the Ist respondent. He, however, did not succeed in obtaining ad- interim injunction and we are told that the notice of nation taken out by him is still pending in . ", "It will thus be seen that failed in his attempts to prevent the 4th respondents from obtaining the contract and enjoying its benefit. The 4th respondents put up two snack bars on the sites provided by the 1st respondent and started running the two snack bars from 1 9th october? 1977. The restaurant however, could not be put up on account of the inability of the Ist respondent to provide appropriate site to the 4th respondents and, therefore, the licence fee for the two snack bars had to be settled and it was fixed at Rs. 4.50O/- per month by mutual agreement between the parties. But it seems that the 4th respondents were not destined to be left in peace to run the two snack bars and soon after the dismissal of the appeal of on l9th october, 1977 and the failure of to obtain an ad interim mandatory injunction in the suit filed by him against the 1st and the 4th respondents, the appellant filed writ petition No. 1582 of 1977 in challenging the decision of the 1st respondent to accept the tender of the 4th respondents. The writ petition was moved before a Single Judge of on 8th November, 1977 after giving prior notice to the respondent and after hearing the parties, the learned Single Judge summarily rejected the writ petition. The appellant preferred an appeal to of against the order rejecting the writ petition and on notice being issued by , the 1st and the 4th respondents filed their respective affidavits in reply showing cause against the admission of the appeal. after considering the affidavits and hearing the parties rejected the appeal in limine on 21st February, 1978. The appellant thereupon filed a petition for special leave to appeal to this Court and since it was felt that the questions raised in the appeal were of seminal importance, this Court granted special leave and decided to hear the appeal at an early date after giving a further opportunity to the parties to file their respective affidavits. That is how the appeal has now come before us for final hearing with full and adequate material placed before us on behalf of both the parties. ", "The main contention urged on behalf of the appellant was that in paragraph (1) of the notice inviting tenders the 1st respondent had stipulated a condition of eligibility by providing that a person submitting a tender must be a \"registered IInd class Hotelier having at least 5 years experience.\" This was a condition of eligibility to be satisfied by every person submitting a tender and if in case of any person, this condition was not satisfied, his tender was ineligible for being considered. The 1st respondent, being a State within the meaning of Art. 12 of the Constitution or in any event a public authority, was bound to give effect to the condition of eligibility set up by it and was not entitled to depart from it at its own sweet will without rational justification. The 4th respondents had experience of catering only in canteens and did not have 5 years' experience of running a IInd class hotel or restaurant and hence they did not satisfy the condition of eligibility and yet the 1st respondent accepted the tender submitted by them. This was clearly in violation of the standard or norm of eligibility set up by the 1 respondent and the action of the 1st respondent in accepting the tender of the 4th respondents was clearly invalid. Such a departure from the standard or norm of eligibility had the effect of denying equal opportunity to the appellant and others of submitting their tenders and being considered for entering into contract for putting up and running the restaurant and two snack bars. The appellant too was not a registered 2nd class hotelier with 5 years' experience and was in the same position as the 4th respondents vis-a-vis this condition of eligibility and he also could have submitted his tender and entered the field of consideration for award of the contract, but he did not do so because of this condition of eligibility which he admittedly did not satisfy. The action of the 1st respondent in accepting the tender of the 4th respondents had, therefore the effect of denying him equality of opportunity in the matter of consideration for award of the contract and hence it was unconstitutional as being in violation of the equality clause. This contention of the appellant was sought to be met by a threefold argument on behalf of the 1 st and the 4th Respondents. The first head of the argument was that grading is given by only to hotels or restaurants and not persons running them and hence there can be a 2nd grade hotel or restaurant but not a 2nd grade hotelier and the requirement in paragraph (1) of the notice that a tenderer must be a registered 2nd grade hotelier was therefore a meaningless requirement and it could not be regarded as laying clown any condition of eligibility. It was also urged that in any event what paragraph (] ) of the notice required was not that a person tendering must have 5 years' experience of running a 2nd grade hotel, but he should have sufficient experience to be able to run a 2nd grade hotel and the 4th respondents were fully qualified in this respect since they had over 10 years' experience in catering to canteens of well known companies, clubs and banks. It was further contended in the alternative that paragraph (8) of the notice clearly provided that the acceptance of the tender- would rest with the Airport Director who did not bind himself to accept any tender and reserved to himself the right to reject all or any of the tenders without assigning any reasons therefor and it was, therefore, competent to the 1st respondent to reject all the tenders and to nogotiate with any person it considered fit to enter into a contract and this is in effect and substance what the 1st respondent did when he accepted the tender of the 4th respondents. The second head of argument was that paragraph (1) of the notice setting out the condition of eligibility had no statutory force nor was it issued under any administrative rules and, therefore, even if there was any departure from the standard or norm of eligibility set out in that paragraph, it was not justiciable and did not furnish any cause of action to the appellant. It was competent to the 1st respondent to give the contract to any one it thought fit and it was not bound by the standard or norm of eligibility set out in paragraph (l) of the notice. It was submitted that in any event the appellant had no right to complain that the 1st respondent had given the contract to the 4th respondents in breach of the condition of eligibility laid down in paragraph (1) of the notice. And lastly, under the third head of argument, it was submitted on behalf. Of the 1st and the 4th respondents that in any view of the matter, the writ petition of the appellant was liable to be rejected in the exercise of its discretion by the , since the appellant had no real interest but was merely a nominee of who had been putting up one person after another to start litigation with a view to preventing the award of the contract to the 4th respondents. The appellant was also guilty of laches and delay in filing the writ petition and the High was justified in rejecting the writ petition in limine particularly in view of the fact that during the period between the date of acceptance of the tender and the date of filing of the writ petition, the 4th respondents had spent an aggregate sum of about Rs. 1,25,000/- in making arrangements for putting up the restaurant and two snack bars. These were the rival contentions urged on behalf of the parties and we shall now proceed to discuss them in the order in which we have set them out. ", "Now it is clear from paragraph (1) of the notice that tenders were invited only from \"registered 2nd Class hoteliers having at least 5 years' experience\". It is only if a person was a registered 2nd Class hotelier having at least 5 years' experience that he could, on the terms of paragraph (1) of the notice, submit a tender. Paragraph (1) of the notice prescribed a condition of eligibility which had to be satisfied by every person submitting a tender and if, in a given case, a person submitting a tender did not satisfy this condition, his tender was not eligible to be considered. Now it is true that the terms and conditions of the tender form did not prescribe that the tenderer must be a registered IInd Class hotelier having at least 5 years' experience nor was any such stipulation to be found in the form c f the agreement annexed to the tender but the notice inviting tenders published in the newspapers clearly stipulated that tenders may be submitted only by registered llnd Class hoteliers having at least 5 years' experience and this tender notice was also included amongst the documents handed over to prospective tenderers when they applied for tender forms. Now the question is, what is the meaning of the expression \"registered Ilnd Class hotelier\", what category of persons fall within the meaning of this description ? This is a necessary enquiry in order to determine whether the 4th respondents were eligible to submit a tender. It is clear from the affidavits and indeed there was no dispute about it that different grades are given by to hotels and restaurants and, therefore, there may be a registered Ilnd Class Hotel but no such grades are given to persons running hotels and restaurants and hence it would be inappropriate to speak of a person as a registered llnd Class hoteIier. But on that account would it be right to reject the expression \"registered IInd Class hotelier\" as meaningless and deprive paragraph (1) of the notice of any meaning and effect. We do not think such a view would be justified by any canon of construction. It is a well settled rule of interpretation applicable alike to documents as to statutes that, save for compelling necessity, the court should not be prompt to ascribe superfluity to the language of a document \"and should be rather at the outset inclined to suppose every word intended to have some effect or be of some use\". To reject words as insensible should be the last resort of judicial interpretation, for it is an elementary rule based on common sense that no author of a formal document intended to be acted upon by the others should be presumed to use words without a meaning. The court must, as far as possible, avoid a construction which would render the words used by the author of the document meaningless and futile or reduce silence any part of the document and make it altogether inapplicaple. Now, here the expression used in paragraph (1) of the notice was \"registered IInd Class hotelier\" and there can be no doubt that by using, this expression the respondent intended to delineate a certain category of persons who alone should be eligible to submit a tender. The respondent was not acting aimlessly or insensibly in insisting upon this requirement nor was it indulging, in a meaningless and futile exercise. It had a definite purpose in view when it laid down this condition of eligibility in paragraph (1) of the notice. It is true that the phraseology used by the respondent to express its intention was rather inapt but it is obvious from the context that the expression \"registered llnd Class hotelier\" was loosely used to denote a person conducting or running a IInd Class hotel or restaurant. It may be ungrammatical but it docs not offend common-sense to describe a person running a registered IInd grade hotel as a registered IInd grade hotelier. This meaning is quite reasonable and does not do any violence to the language and makes sense of the provision contained in paragraph (1) of the notice. We must, in the circumstances, hold that, on a proper construction, what paragraph (1) of the notice required was that only a person running a registered llnd Class hotel or restaurant and having at least 5 years' experience as such should be eligible to submit a tender. This was a condition of eligibility and it is difficult to see how this condition could be said to be satisfied by any person who did not have five years' experience of running a IInd Class hotel or restaurant. The test of eligibility laid down was an objective test and not a subjective one. What the condition of eligibility required has that the person submitting a tender must have 5 years' experience of running a II Class hotel, as this would ensure by an objective test that he was capable of running a Il Class restaurant and it should not be left to the respondent to decide in its subjective discretion that the person tendering was capable of running such a restaurant. If therefore, a person submitting a tender did not have at least 5 years' experience of running a II Class hotel, he was not eligible to submit the tender and it would not avail him to say that though he did not satisfy this condition, he was otherwise capable of running a IInd Class restaurant and should, therefore, be considered. This was in fact how the 1 st respondent itself understood this condition of eligibility. When the 4th respondents submitted their tender along with Their Letter dated 24th January, 1977, it appeared from the documents submitted by the 4th respondents that they did not have 5 years' experience of running a II Class restaurant. The 1st respondent by its letter dated l5th February 1977 required the 4th respondents to produce documentary evidence to show that they were \"registered II Class hotelier having at least 5 years' experience.\" The 1st respondent did not regard this requirement of eligibility as meaningless or unnecessary and wanted to be satisfied that the 4th respondent did fulfil this requirement. Now, unfortunately for the 4th respondents, the had over lO years' experience of running can teens but at the date when they submitted their tender, they cannot running a II grade hotel or restaurant nor did they have 5 years' experience of running such a hotel or restaurant. Even if the experience of the 4th respondents in the catering line were taken into account from 1962 onwards, it would not cover a total period of more than 4 years 2 months so far as catering experience in llnd Grade hotels and restaurants is concerned. The 4th respondents thus did not satisfy the condition of eligibility laid down in paragraph (1) of the notice and in fact this was implidely conceded by the 4th respondents in their letter dated 26th February, 1977 where A they stated that they had \"experience equivalent to that of a 2nd class or even 1st class hotelier.\" The 4th respondents were, accordingly, not eligible for submitting a tender and the action of the 1st respondent in accepting their tender was in contravention of paragraph (1) of the notice. ", "It was suggested on behalf of the 1st and the 4th respondents that there was nothing wrong in the 1st respondent giving the contract to the 4th respondents since it was competent to the 1st respondent to reject all the tenders received by it and to negotiate directly with The 4th respondents for giving them the contract and it made no difference that instead of following this procedure, which perhaps might have resulted in the 4th respondents offering a smaller licence fee and the 1 st respondent suffering a loss in the process, true 1 st respondent accepted The tender of the 4th respondents. We do not think there is any force in this argument. It is true that there was no statutory or administrative rule requiring the 1st respondent to give a contract only by inviting tenders and hence the 1st respondent was entitled to reject all the tenders and, subject to the constitutional norm laid down in Art 14, negotiate directly for entering into a contract. Paragraph (8) of the notice also made it clear that the 1st respondent was not bound to accept any tender and could reject all the tenders received by it. But here the 1st respondent did not reject the tenders outright and enter into direct negotiations with the 4th respondents for awarding the contract. The process of awarding a contract by inviting tenders was not terminated or abandoned by the 1st respondent by rejecting all the tenders but in furtherance of the process, the tender of the 4th respondents was accepted by the 1st respondent. The contract was not given to the 4th respondents as a result of direct negotiations. Tenders were invited and out of the tenders received, the one submitted by the 4th respondents was accepted and the contract was given to them. It is, therefore not possible to justify the action of the 1st respondent on the ground that the 1st respondent could have achieved the same result by rejecting all the tenders and entering into direct negotiations with the 4th respondents. ", "That takes us to the next question whether the acceptance of the tender of the 4th respondents was invalid and liable to be set aside at the instance of the appellant. It was contended on behalf GI the 1st and the 4th respondents that the appellant had no locus to maintain the writ petition since no tender was submitted by him and he was a mere stranger. The argument was that if the appellant did not enter the field of competition by submitting a tender, what did it matter to him whose tender was accepted; what grievance could he have if the tender of the 4th respondents was wrongly accepted. A person whose tender was rejected might very well complain that the tender of someone else was wrongly accepted, but it was submitted, how could a person who never tendered and who was at no time in the field, put forward such a complaint ? This argument, in our opinion, is mis-conceived and cannot be sustained for a moment. The grievance of the appellant, it may be noted, was not that his tender was rejected as a result of improper acceptance of the tender of the 4th respondents, but that he was differentially treated and denied equality of opportunity with the 4th respondents in submitting a tender. His complaint was that if it were known that non-fulfilment of the condition of eligibility would be no bar to consideration of a tender, he also would have submitted a tender and competed for obtaining a contract. But he was precluded from submitting a tender and entering the field of consideration by reason of the condition of eligibility, while so far as the 4th respondents were concerned, their tender was entertained and accepted even though they did not satisfy the condition of eligibility and this resulted in inequality of treatment which was constitutionally impermissible. This was the grievance made by the appellant in the writ petition and there can be no doubt that if this grievance were well founded, the appellant would be entitled to maintain the writ petition. The question is whether this grievance was justified in law and the acceptance of the tender of the 4th respondents was vitiated by any legal infirmity. ", "Now, there can be no doubt that what paragraph (1) of the notice prescribed was a condition of eligibility which was required to be satisfied by every person submitting a tender. The condition of eligibility was that the person submitting a tender must be conducting or running a registered 2nd class hotel or restaurant and he must have at least 5 years' experience as such and if he did not satisfy this condition of eligibility his tender would not be eligible for consideration. This was the standard or norm of eligibility laid down by the 1 st respondent and since the 4th respondents did not satisfy this standard or norm, it was not competent to the 1st respondent to entertain the tender of the 4th respondents. It is a well settled rule of administrative law that an executive authority must be rigorously held to the standards by which it professes its actions to be judged and it must scrupulously observe those Standards on pain of invalidation of an act in violation of them. This rule was enunciat- ", "1031 ", "ed by Mr Justice in v. Seton(l) where the learned Judge said: ", "\"An executive agency must be rigorously held to the standards by which it professes its action to be judged. Accordingly, if dismissal from employment is based on a define(l procedure, even though generous beyond the requirement that bind such agency, that procedure must be scrupulously observed. This judicially evolved rule of administrative law is now firmly established and, if I may add, rightly so. He that takes the procedural sword shall perish with the sword. ", "This Court accepted the rule as valid and applicable in India in v. Punjab(2) and in subsequent decision given in v. Bhagatram,(3) , J., quoted the above-referred observations of Mr. Justice with approval. It may be noted that this rule, though supportable also as emanation from Article 14 , does not rest merely on that article. It has an independent existence apart from Article 14. It is a rule of administrative law which has been judicially evolved as a check against exercise of arbitrary power by the executive authority. If we turn to the judgment of Mr. Justice and examine it, we find that he has not sought to draw support for the rule from the equality clause of the United s Constitution, but evolved it purely as a rule of administrative law. Even in England, the recent trend in administrative law is in that direction as is evident from what is stated at pages 540-41 in Prof. 's Administrative Law 4th edition. There is no reason why we should hesitate to adopt this rule as a part of our continually expanding administrative law. To- day with tremendous expansion of welfare and social service functions, increasing control of material and economic resources and large scale assumption of industrial and commercial activities by the , the power of the executive Government to affect the lives of the people is steadily growing. The attainment of socio-economic justice being a conscious end of policy, there is a vast and inevitable increase in the frequency with which ordinary citizens come into relationship of direct encounter with power-holders. This renders it necessary to structure and restrict the power of the executive Government so as to prevent its arbitrary application or (1) 359 U. S. 535 : 3 Law.Ed. (Second series) 1012 (2) 3. S. C. R. 82. ", "(3) [1975] 3. S. C. R. 619. ", "1032 ", "exercise. Whatever be the concept of the rule of law, whether it be the meaning given by in his \"The Law of the Constitution\" or the definition given by in his \"Road to Serfdom' and 'Constitution of liberty\" or the exposition set-forth by in his \"The Rule of Law and the Welfare State\", there is, as pointed out by , J., in his article on \"The Welfare State, Rule of Law and Natural Justice\" in \"democracy Equality and Freedom,\" \"substantial agreement is in justice thought that the great purpose of the rule of law notion is the protection of the individual against arbitrary exercise of power, wherever it is found\". It is indeed unthinkable that in a democracy governed by the rule of law the executive Government or any of its officers should possess arbitrary power over the interests of the individual. Every action of the executive Government must be informed with reason and should be free from arbitrariness. That is the very essence of the rule of law and its bare minimal requirement. And to the application of this principle it makes no difference whether the exercise of the power involves affection of some right or denial of some privilege. ", "To-day the , is a welfare , is the regulator and dispenser of special services and provider of a large number of benefits, including jobs contracts, licences, quotas, mineral rights etc. The pours forth wealth, money, benefits, services, contracts, quotas and licences. The valuables dispensed by take many forms, but they all share one characteristic. They are steadily taking the place of traditional forms of wealth. These valuables which derive from relationship to are of many kinds. They comprise social security benefits, cash grants for political sufferers and the whole scheme of and local welfare. Then again, thousands of people are employed in the and the Central s and local authorities. Licences are required before one can engage in many kinds of business or work. The power of giving licences means power to withhold them and this gives control to the or to the agents of on the lives of many people. Many individuals and many more businesses enjoy largess in the form of contracts. These contracts often resemble subsidies. It is virtually impossible to lose money on them and many enterprises are set up primarily to do business with . owns and controls hundreds of acres of pubic Land valuable for mining and other purposes. These resources are available for utilisation by private corporations and individuals by way of lease or licence. All these mean growth in the largess and with the increasing magnitude and range of governmental functions as we move closer to a welfare , more and more of our wealth consists of these new forms. Some of these forms of wealth may be in the nature of legal rights but the large majority of them are in the nature of privileges But on that account, can it be said that they do not enjoy any legal protection ? Can they be regarded as gratuity furnished by the so that the may withhold, grant or revoke it at its pleasure ? Is the position of the in this respect the same as that of a private giver? We do not think so. The law has not been slow to recognise the importance of this new kind of wealth and the need to protect individual interest in it and with that end in view, it has developed new forms of protection. some interests in largess, formerly regarded as privileges, have been recognised as rights while others have been given legal protection not only by forging procedural safeguards but also by confinding/structuring and checking discretion in the matter of grant of such largess. The discretion of the has been held to be not unlimited in that the cannot give or withhold largess in its arbitrary discretion or at its sweet will. It is insisted, as pointed out by Prof. in an especially stimulating article on \"The New Property\" in 73 733, \"that action be based on standards that are not arbitrary or unauthorised.\" \"The cannot be permitted to say that it will give jobs or enter into contracts or issue quotas or licences only in favour of those having grey hair or belonging to a particular political party or professing a particular religions faith. The is still the when it acts in the matter of granting largess and it cannot act arbitrarily. It does not stand in the same position as a private individual We agree with the observations of , J., in (1) that: \"The is not and should not be as free as an individual in selecting the recepients for its largess. Whatever its activity, the is still the and will be subject to restraints, inherent in its position in a democratic society. A democratic cannot lay down arbitrary and capricious standards for the choice of persons with whom alone it will deal\". The same point was made by this court in (2) where the question was whether black-listing of a person without (1) AIR 1969 Kerala 81. ", "(2) [1975] 2 S.C.R. 674. ", "10-409 SCI/79 giving him an opportunity to be heard was bad ? , C. J., speaking on behalf of himself and his colleagues on the Bench pointed out that black-listing on a person not only affects his reputation which is in Poundian terms an interest both of personality and substance, but also denies him equality in the matter of entering into contract with the and it cannot, therefore, be supported without fair hearing. It was argued for the that no person has a right to enter into contractual relationship with the and the , like any other private individual, has the absolute right to enter into contract with any one it pleases. But the , speaking through the learned Chief Justice, responded that the is not like a private individual who can pick and choose the person with whom it will deal, but the is still a when it enters into contract or when it is administering largess and it cannot, without adequate reason, exclude any person from dealing with it or take away largess arbitrarily. The learned Chief Justice said that when the is trading with the public, \"the democratic form of demands equality and absence of arbitrariness and discrimination in such transactions. The activities of the have a public element and, therefore, there should be fairness and equality. The need not enter into any contract with anyone, but if it does so, it must do so fairly without discrimination and without unfair procedure.\" This proposition would hold good in all cases of dealing by the with the public, where the interest sought to be protected is a privilege. It must, therefore, be taken to be the law that where the is dealing with the public, whether by way of giving jobs or entering into contracts or issuing quotas or licences or granting other forms of largess, the cannot act arbitrarily at its sweet will and, like a private individual, deal with any person it pleases, but its action must be in conformity with standard or norms which is not arbitrary, irrational or irrelevant. The power or discretion of the in the matter of grant of largess including award of jobs, contracts, quotas, licences etc., must be confined and structured by rational, relevant and non-discriminatory standard or norm and if the departs from standard or norm in any particular case or cases, the action of the would be liable to be struck down, unless it can be shown by the that the departure was not arbitrary, but was based on some valid principle which in itself was not irrational, unreasonable or discriminatory. ", "Now, it is obvious that the which represents the executive authority of the , may act through the instrumentality Or agency of natural persons or it may employ the instrumentality or agency of juridical persons to carry out its functions. In the early days, when the had limited functions, it could operate effectively through natural persons constituting its civil service and they were found adequate to discharge governmental functions, which were of traditional vintage. But as the tasks of the multiplied the advent of the welfare , it began to be increasingly felt that the framework of civil service was not sufficient to handle the new tasks which were often of specialised and highly technical character. The inadequacy of the civil service to deal with these new problems came to be realised and it became necessary to force a new instrumentality or administrative device for handling these new problems. It was in these circumstances and with a view to supplying this administrative need that the public corporation came into being as the third arm of the . As early as 1819 of the United s in v. Maryland(1) held that the has power to charter corporations as incidental to or in aid of governmental functions and, as pointed out by , J., in (supra) such federal corporations would ex-hypothesi be agencies of the . In Great Britain too, the policy of public administration through separate corporations was gradually evolved and the conduct of basic industries through giant corporations has now become a permanent feature of public life. So far as India is concerned, the genesis of the emergence of corporations as instrumentalities or agencies of is to be found in the of India Resolution on Industrial Policy dated 6th April, 1948 where it was stated inter alia that \"management of enterprises will as a rule be through the medium of public corporation under tile statutory control of the Central who will assume such powers as may be necessary to ensure this.\" It was in pursuance of the policy envisaged in this and subsequent resolutions on Industrial Policy. that corporations were created by for setting up and management of public enterprises and carrying out other public functions. Ordinarily these functions could have been carried out by departmentally through its service personnel, but the instrumentality or agency of the corporations was resorted to in these cases having regard to the nature of the task to be performed. The corporations acting as instrumentality or agency of would obviously be subject to the same limitations in the field of constitutional and administrative law as itself, though (1) 4 Wheat 315 in the eye of the law, they would be distinct and independent legal entities. If acting through its officers is subject to certain constitutional and public law limitations, it must follow a fortiori that acting through the instrumentality or agency of corporations should equally be subject to the same limitations. But the question is how to determine whether a corporation is acting as instrumentality or agency of . It is a question not entirely free from difficulty. ", "A corporation may be created in one of two ways. It may be either established by statute or incorporated under a law such as the Companies Act 1956 or the Societies Registration Act 1860. Where a is wholly controlled by not only in its policy making but also in carrying out the functions entrusted to it by the law establishing it or by the Charter of its incorporation, there can be no doubt that it would be an instrumentality or agency of . But ordinarily where a corporation is established by statute, it is autonomous in its working, subject only to a provision, often times made, that it shall be bound by any directions that may be issued from time to time by in respect of policy matter. So also a corporation incorporated under law is managed by a board of directors or committee of management in accordance with the provisions of the statute under which it is incorporated. When does such a corporation become an instrumentality or agency of ? Is the holding of the entire share capital of the by enough or is it necessary that in addition, there should be a certain amount of direct control exercised by and, if so, what should be the nature of such control ? Should the functions which the corporation is charged to carry out possess any particular characteristic or feature, or is the nature or the functions immaterial ? Now, one thing is clear that if the entire share capital of the corporation is held by , it would go a long way towards indicating that the corporation is an instrumentality or agency of . But, as is quite often the case, a corporation established by statute may have no shares or shareholders, in which case it would be a relevant factor to consider whether the administration is in the hands of a board of directors appointed by , though this consideration also may not be determinative, because even while the directors are appointed by , they may be completely free from governmental control in the discharge of their functions. What then are the tests to determine whether a corporation established by statute or incorporated under law is an instrumentality or agency of ? It is not possible to formulate an all- ", "1037 ", "inclusive or exhaustive test which would adequately answer this question 'there is no cut and dried formula, which would provide the correct division of corporations into those which are instrumentalities or agencies of and those which are not. ", "The analogy of the concept of action as developed in the United s may not, however, be altogether out of place while considering this question. The decisions of the court in the United s seem to suggest that a private agency, if supported by extraordinary assistance given by the , may be subject to the same constitutional limitations as the . Of course, it may be pointed out that \"the 's general common law and statutory structure under which its people carry on their private affairs, own property and contract, each enjoying equality in terms of legal capacity, is not such assistance as would transform private conduct into action\". But if extensive and unusual financial assistance is given and the purpose of the in giving such assistance coincides with the purpose for which the corporation is expected to use the assistance and such purpose is if public character, it may be a relevant circumstance supporting an extensive that the corporation is an instrumentality or agency of . The leading case on the subject in the United s is v. ). The Library system in question in this case was established by private donation in 1882, but by 1944, 99 per cent of the system's budget was supplied by the city, title to the library property was held by the city, employees there paid by the city payroll officer and a high degree of budget control was exercised or available to the city government. On these facts required the trustees managing the system to abandon a discriminatory admission policy for its library training courses. It will be seen that in this case there was considerable amount of control of the library system in addition to extensive financial assistance and it is difficult to say whether, in the absence of such control it would have been possible to say that the action of the trustees constituted action. has expressed the opinion in his article on \"The meaning of Act ion\" (60 Colombia Law Review 1083) that in this case \"it is extremely unlikely that absence of public control would have changed the result as long as 99% of the budget of a nominally private institution was provided by government. Such extensive governmental support should be sufficient identification with the to subject the institution to the provisions of the Fourteenth Amendment\". ", "(1) 149 F. 2d. 212. ", "1038 ", "It may, therefore, be possible to say that where the financial assistance of the is so much as to meet almost entire expenditure of the corporation, it would afford some indication of the corporation being impregegnated with governmental character. But where financial assistance is not so extensive, it may not by itself, without anything more render the corporation an instrumentality or agency of government, for there are many private institutions which are in receipt of financial assistance from the and merely on that account, they cannot be classified as agencies. Equally a mere finding of some control by the would not be determinative of the question \"since a has considerable measure of control under its police power over all types of business operations\". But 'a finding of financial support plus an unusual degree of control over the management and policies might lead one to characteristic an operation as action\" vide v. ). So also the existence of deep and pervasive control may afford an indication that the is a agency or instrumentality. It may also be a relevant factor to consider whether the corporation enjoys monopoly status which is conferred or protected. There can be little doubt that conferred or protected monopoly status would be highly relevant in assessing the aggregate weight of the corporation's ties to the . Vide the observations of , J., in v. ) There is also another factor which may be regarded as having a bearing on this issue and it is whether the operation of the corporation is an important public function. It has been held in the United s in a number of cases that the concept of private action must yield to a conception of action where public functions are being per formed. : \"The Constitutional Law of the Security \" (10 620 at 664). It was pointed out by , J., in v. Newton(3) that \"when private individuals or groups are endowed by the with powers or functions governmental in nature, they become agencies or instrumentalities of the \". Of course, with the growth of the welfare , it is very difficult to define what functions are governmental and what are not, because, as pointed out by , L.J., in v.) there has been, since mid-Victorian times, \"a revolution in political thought and a totally different conception prevails today as to what is and what is not within the functions of \". ", "(I) [1975] 3 S. C. R. 619 at 658. ", "(2) 419 U. S. 345 : 42 L. ed. 2nd 477 (3) 382 U S. 296 : 15 L. ed 2nd 373. ", "(4) [1964] I Ch. 614. ", " ", ", , also observed to the same effect in New York v. United s(1): \" A 's project is as much a legitimate governmental activity whether it is traditional or akin to private enterprise, or conducted for profit.\" Cf. v. ). A may deem it as essential to its economy that it own and operate a railroad, a mill, or an irrigation system as it does to own and operate bridges, street lights, or a sewage disposal plant. What might have been viewed in an earlier day as an improvident or even dangerous extension of state activities may today be deemed indispensable. It may be noted that besides the so called traditional functions, the modern operates a multitude of public enterprises and discharges a host of other public functions. If the functions of the corporation are of public importance and closely related to governmental functions, it would be a relevant factor in classifying the corporation as an instrumentality or agency of Government. This is precisely what was pointed out by , , in v. (supra) where the learned Judge said that \"institutions engaged in matters of high public interest or performing public functions are by virtue of the nature of the functions performed government agencies. Activities which are too fundamental to the society are by definition too important not to be considered government functions.\" ", "This was one of the principal tests applied by in v. Alabama(3) for holding that a corporation which owned a Company town was subject to the same constitutional limitations as the . This case involved the prosecution of , a member of the Johevah's witnesses sect, under a state trespass statute for refusing to leave the side walk of the company town where she was distributing her religious pamphlets. She was fined $ 5/- and aggrieved by her conviction she carried the matter right upto contending successfully that by reason of the action of the corporation her religious liberty had been denied. held that administration of private property such as a town, though privately carried on, was, nevertheless, in the nature of a public function and that the private rights of the corporation must, therefore, be exercised within constitutional limitations and the conviction for trespass was reversed. The dominant theme of the majority opinion written by Mr. Justice was that the property of the corporation used as a town not recognisably different from other towns, lost its identification as purely private property. It was said that a town may ", "(l) 326 U.S. 572. ", "(2) 304 U.S. 405, 426, 427. ", "(3) 326 U.S. 501: 19 L. ed. 265. ", "1040 ", "be privately owned and managed but that does not necessarily aIlow the corporation to treat it as if it was wholly in the private sector and the exercise of constitutionally protected rights on the public ,street of a company town could not be denied by the owner. \"The more an owner, for his advantage, opens up his property for use by the public in general, the more do his rights become circumscribed by the statutory and constitutional rights of those who use it. . . Thus, the owners of privately held bridges, ferries, turnpikes and railroads may not operate them as freely as a farmer does his farm. Since these facilities are built and operated primarily to benefit the public and since their operation is essentially a public function, it is subject to state regulation\". Mr. Justice , concurring, reduced the case to simpler terms. He found in the realm of civil liberties the need to treat a town, private or not, as a town. The function exercised by the corporation was in the nature of municipal function and it was, therefore, subject to the constitutional limitations placed upon action. ", "We find that the same test of public or governmental character of the function was applied by of the United States in v. (supra) and v. ) But the decisions show that even this test of public or governmental character of the function is not easy of application and does not invariably lead to the correct inference because the range of governmental activity is broad and varied and merely because an activity may be such as may legitimately be carried on by , it does not mean that a corporation, which is otherwise a private entity, would be an instrumentality or agency of by reason of carrying on such activity. In fact, it is difficult to distinguish between governmental functions and non-governmental functions. Perhaps the distinction between governmental and non-governmental functions is not valid any more in a social welfare State where the laissez faire is an outmoded concept and social statics has no place. The contrast is rather between governmental activities which are private and private activities which are governmental. (, J. v. (supra) at p. 652). But the public nature of the function, if impregnated with governmental character or \"tied or entwined with \" or fortified by some other additional factor, may render the corporation an instrumentality or agency of . Specifically, if a department of is transferred to a corporation, it would be a strong factor supportive of this inference. ", "(1) 321 U. S. 649 . ", "1041 ", "It will thus be seen that there are several factors which may have to be considered in determining whether a corporation is an agency or instrumentality of . We have referred to some of these factors and they may be summarised as under: whether there is any financial assistance given by the , and if so, what is the magnitude of such assistance whether there is any other form of assistance, given by the , and if so, whether it is of the usual kind or it is extraordinary, whether there is any control of the management and policies of the corporation by the and what is the nature and extent of such control, whether the corporation enjoys conferred or protected monopoly status and whether the functions carried out by the corporation are public functions closely related to governmental functions. This particularisation of relevant factors is however not exhaustive and by its very nature it cannot be, because with increasing assumption of new tasks, growing complexities of management and administration and the necessity of continuing adjustment in relations between the corporation and calling for flexibility, adapt ability and innovative skills, it is not possible to make an exhaustive enumeration of the tests which would invariably and in all cases provide an unfailing answer to the question whether a corporation is governmental instrumentality or agency. Moreover even amongst these factors which we have described, no one single factor will yield a satisfactory answer to the question and the court will have to consider the cumulative effect of these various factors and arrive at its decision on the basis of a particularised inquiry into the facts and circumstances of each case. \"the dispositive question in any stale action case,\" as pointed out by , J., in v. (supra) \"is not whether any single fact or relationship presents a sufficient degree of state involvement, but rather whether the aggregate of all relevant factors compels a finding of state responsibility.\" It is not enough to examine seriatim each of the factors upon which a corporation is claimed to be an instrumentality or agency of and to dismiss each individually as being insufficient to support a finding of that effect. It is the aggregate or cumulative affect of all the relevant factors that is controlling. G Now, obviously where a corporation is an instrumentality or agency of , it would, in the exercise of its power or discretion, be subject to the same constitutional or public law limitations as . The rule inhibiting arbitrary action by which we have discussed above must apply equally where such corporation is dealing with the public, whether by way of giving jobs or entering into contracts or otherwise, and it cannot act arbitrarily and enter into relationship with any person it likes at its sweetwill, but its action must be in conformity with some principle which meets the test of reason and relevance. ", "This rule also flows directly from the doctrine of equality embodied in Art. 14. It is now well settled as a result of the decisions of this Court hl cf Tamil Nadu(l) and (2) that Article 14 strikes at arbitrariness in action and ensures fairness and equality of treatment. It requires that action must not be arbitrary but must be based on some rational and relevant principle which is non- discriminatory: it must not be guided by any extraneous or irrelevant considerations, because that would be denial of equality. The principle of reasonableness and rationality which is legally as well as philosophically an essential element of equality or non-arbitrariness is protected by Article 14 and it must characterise every action, whether it be under authority of law or in exercise of executive power without making of law. The cannot, therefore act arbitrarily in entering into relationship, contractual or otherwise with a third party, but its action must conform to some standard or norm which is rational and non-discriminatory. This principle was recognised and applied by a Bench of this Court presided over by , C.J., in (supra) where the learned Chief Justice pointed out that \"the can carry on executive function by making a law or without making a law. The exercise of such powers and functions in trade by the is subject to Part III of the Constitution. Article 14 speaks of equality before the law and equal protection of the laws. Equality of opportunity should apply to matters of public contracts. The has the right to trade. The has there the duty to observe equality. An ordinary individual can choose not to deal with any person The Government cannot choose to exclude persons by discrimination. The order of black- listing has the effect of depriving a person of equality of opportunity in the matter of public contract. A person who is on the approved list is unable to enter into advantageous relations with the Government because of the order of blacklisting.... A citizen has a right to claim equal treatment to enter into a contract which may be proper, necessary and essential to his lawful calling....It is true that neither the petitioner nor the respondent has any right to enter into a contract but they are entitled to equal treatment with others who offer tender or quotations for the purchase of the (1) 2 S. C. R. 348. ", "(2) 1978] 2 S. C. R. 621. ", "1043 ", "goods.\" It must, therefore follow as a necessary corollary from the principle of equality enshrined in Article 14 that though the is entitled to refuse to enter into relationship with any one, yet if it does so, it cannot arbitrarily choose any person it likes for entering into such relationship and discriminate between persons similarly circumstanced, but it must act in conformity with some standard or principle which meets the test of reasonableness and non-discrimination and any departure from such standard or principle would be invalid unless it can be supported or justified on some rational and non-discriminatory ground. ", "It is interesting to find that this rule was recognised and applied by a Constitution Bench of this Court in a case of sale of kendu leaves by the of Orissa in .(1) The trade of kendu leaves in the State of Orissa was regulated by the Orissa Kendu Leaves (Control of Trade) Act, 1961 and this Act created a monopoly in favour of the State so far as purchase of kendu leaves from growers and pluckers was concerned. Section 10 of the Act authorised the to sell or otherwise dispose of kendu leaves purchased in such manner as the might direct. The first evolved a scheme under which it offered to renew the Licences of those traders who in its view had worked satisfactorily in the previous year and had regularly paid the amount due from them. The scheme was challenged and realising that it might be struck down, the withdrew the scheme and instead, decided to invite tenders for advance purchase of kendu leaves but restricted the invitation to those individuals who had carried out contracts in the previous year without default and to the satisfaction of the . This method of sale of kendu leaves was also challenged by filing a writ petition on the ground inter alia that it was violative of Articles ]4 and 19(1)(g) and this challenge, though negatived by , was upheld by this Court in appeal. The Court pointed out that the original scheme of offering to enter into contracts with the old licences and to renew their terms was open to grave objection, since it sought arbitrarily to exclude many persons interested in the trade and the new scheme under which the restricted the invitation to make offers to those traders who had carried out their contracts in the previous year without default and to the satisfaction of the was also objectionable, since the right to make tenders for the purchase of kendu leaves being restricted to a limited (1) 3 S.C.R. 374. ", "1044 ", "class of persons, it effectively shut out all other persons carrying on trade in kendu leaves and also the new entrants into that business and hence it was ex-facie discriminatory and imposed unreasonable restrictions upon the right of persons other than the existing contractors to carry on business. Both the schemes evolved by the were thus held to be violative of Articles 14 and 19(1)(g) because they \"gave rise to a monopoly in the trade in kendu leaves to certain traders and singled out other traders for discriminatory treatment\". The argument that existing contractors who had carried out their obligations in the previous year regularly and to the satisfaction of the formed a valid basis of classification bearing a just and reasonable relation to the object sought to be achieved by the sales namely, effective execution of the monopoly in the public interest, was also negatived and it was pointed out that: \"exclusion of all persons interested in the trade, who were not in the previous year licencees, is ex facie arbitrary; it had not direct relation to the object of preventing exploitation of pluckers and growers of kendu leaves, nor had it any just or reasonable relation to the securing of the full benefit from the trade, to the \". ", "The referred to the offer made by a well known manufacturer of bidis for purchase of the entire crop of kendu leaves for a sum of Rs. 3 crores which was turned down by the and expressed its surprise that no explanation was attempted to be given on behalf of the as to why such an offer, from which the stood to gain more than Rs. 1 crore, was rejected by the . It will be seen from this judgment that restricting the invitation to submit tenders to a limited class of persons was held to be violative of the equality clause, because the classification did not bear any. just and reasonable relation to the object sought to be achieved, namely, selling of kendu leaves in the interest of general public. The standard or norm laid down by the for entering into contracts of sale of tendu leaves with third parties was discriminatory and could not stand the scrutiny of Article 14 and hence the scheme was held to be invalid. The rejected the contention of the that by reason of section 10 it was entitled to dispose of kendu leaves in such manner as it thought fit and there was no limitation upon its power to enter into contracts for sale of kendu leaves with such persons it liked. The held that the was, in the exercise of its power to enter into contracts for sale of kendu leaves; subject to the constitutional limitation of Article 14 and it could not act arbitrarily in selecting persons with whom to enter into contracts and discriminate against others similarly situate. The criticised the for not giving any explanation as to why an offer for a large amount was not accepted, the clearest implication being that the must act in the public interest; it cannot act arbitrarily and without reason and if it does so, its action would be liable to be invalidated. This decision wholly supports the view we are taking in regard to The applicability of the rule against arbitrariness in action. B We may also in this connection refer to the decision of this in (1), where , J., speaking on behalf of The made certain observation which was strongly relied upon on behalf of the respondents. The facts of this case were that the petitioner and the 3rd respondent , Cannanore, submitted tenders for the supply of milk to the hospital at Cannanore for the year 1948- ", "49. The Superintendent who scrutinised the tenders accepted that of the petitioner and communicated the reasons for the decision to the Director of Public Health. The resulting contract in favour of the petitioner was, however, subsequently cancelled by issuing a notice in terms of clause (2) of the tender, in pursuance of the policy of the that in the matter of supply to Medical Institutions should be given contract on the basis of prices filed by . The petitioner challenged The decision of the in a petition under Article 32 of the Constitution on the ground inter alia that there had been discrimination against him vis-a-vis the 3rd respondent and as such, there was contravention of Article 14 of the Constitution. The Constitution Bench rejected this contention of the petitioner and while doing so, , J., made the following observation: \"There is no discrimination, because it is perfectly open to the , even as it is to a private party, to choose a person to their liking, to fulfil contracts which they wish to be performed. When one person is choosen rather than another, the aggrieved party cannot claim the protection of Article 14 , because the choice of the person to fulfil a particular contract must be left to the .\" The respondents relied very strongly on this observation in support of their contention that it is open to the 'State' to enter into contract with any one it likes and choosing one person in preference to another for entering into a contract does not involve violation of Article 1a. Though the language in which this observation is couched is rather wide, we do not think that in making this observation, the . intended to lay down any absolute proposition permitting the state to act arbitrarily in the matter of entering into contract with (1) Supp. 1 S C. R. 787. ", "1046 ", "third parties. We have no doubt that the could not have intended to lay down such a proposition because who delivered the judgment of the in this case was also a party to the judgment in (supra) which was also a decision of , where it was held in so many terms that the cannot act arbitrarily in selecting persons with whom to enter into contracts. Obviously what the meant to say was that merely because one person is chosen in preference to another, it does not follow that there is a violation of Article 14 , because the Government must necessarily be entitled to make a choice. But that does not mean that the choice be arbitrary or fanciful. The choice must be dictated by public interest and Must not be unreasoned or unprincipled. ", "The respondents also relied on the decision of this Court in .(1) The complaint of the petitioner in that case was that the bids of persons making the highest tenders were not accepted and persons who had made lesser bids were asked to raise their bids to the highest offered and their re vised bids were accepted. The Constitution Bench negatived this complaint and speaking through Mitter, J., observed: ", "\"With regard to the grievance that in some cases the bids of persons making the highest tenders were not accept ed, The facts are that persons who had made lower bids were asked to raise their bids to the highest offered before the same were accepted. Thus there was no loss to and merely because the preferred one tender to another no complaint can be entertained. certainly has a right to enter into a contract with a person well known to it and specially one who has faithfully performed his contracts in the past in preference to an undesirable or unsuitable or untried person. Moreover, is not bound to accept the highest tender but may accept a lower one in case it thinks that the person offering the lower tender is on an overall consideration to be preferred to the higher tenderer.\" ", "We fail to see how this observation can help the contention of the respondents. It does not say that the Government can enter into contract with any one it likes arbitrarily and without reason. On the contrary, it postulates that the Government may reject a higher tender and accept a lower one only when there is valid reason lo do so, as for example, where it is satisfied that the person offering the Lower ", "1) [1971] 3 S. C. C. 153. ", "1047 ", "tender is on an overall consideration preferable to the higher tenderer. There must be some relevant reason for preferring one tenderer to another, and if there is, the can certainly enter into contract with the former even though his tender may be lower but it cannot do so arbitrarily or for extraneous reason. ", "There was also one other decision of this in .(1) which was strongly relied upon on behalf of the respondents. There the respondents were the highest bidders at an auction held by the orissa through the Excise Commissioner for the exclusive privilege of selling by retail country liquor in some shops. The auction was held pursuant to an order dated 6th January, 1971 issued by the of orissa in exercise of the power conferred under section 29(2) of the Bihar & orissa Excise Act , 1915 and clause (6) of this order provided that \"no sale shall be deemed to be final unless confirmed by the State who shall be at liberty to accept or reject any bid without assigning any reason therefor\". The of orissa did not accept any of the bids made at the auction and subsequently sold the privilege by negotiations with some other parties. One of the contentions raised on behalf of the petitioners in that case was that the power retained by the \"to accept or reject many bid without any reason therefor\" was an arbitrary power violative of Articles 14 and 19(1) (g). This contention was negatived and , J. speaking on behalf of the observed: ", "\"The is the guardian of the finances of the . It is expected to protect the financial interest of the . Hence quite naturally, the legislature has empowered the to see that there is no leakage in its revenue. It is for the to decide whether the price offered in on auction sale is adequate. While accepting or rejecting a bid, it is merely performing an executive function. The correctness of its conclusion is not open to judicial review. We fail to see how the plea of contravention of Article 19(1)(g) or Article 14 can arise in these cases. The s power to sell the exclusive privilege set out in section 22 was not denied. It was also not disputed that these privileges could be sold by public auction. Public auctions are held to get the best possible price. Once these aspects are recognised, there appears to be no basis for contending that the owner of the privileges (1) 2 S.C.C. 36. ", "1048 ", "in question who had offered to sell them cannot decline to accept the highest bid if he thinks that the price offered is inadequate.\" ", "It will be seen from these observations that the validity of clause (6) of the order dated 6th January, 1971 was upheld by this Court on the ground that having regard to the object of holding the auction, namely, to raise revenue, the Government was entitled to reject even the highest bid, if it thought that the price offered was inadequate. The Government was not bound to accept the tender of the person who offered the highest amount and if the Government rejected all the bids made at the auction, it did not involve any violation of Article 14 or 19(1)(g). This is a self-evident proposition and we do not see how it can be of any assistance to the respondents. ", "The last decision to which reference was made on behalf of the respondents was the decision in v. ) This decision merely reiterates the principle laid down in the earlier decisions in (supra) and (supra) and points out that a condition that the shall be at liberty to accept or reject any bid without assigning any reason therefor is not violative of Article 14 and that \"in matters relating to contracts with the , the latter is not bound to accept the tender of the person who offers the highest amount\". Now where does it say that such a condition permits the to act arbitrarily in accepting a tender or that under the guise or pretext of such a condition, the may enter into a contract with any person it likes, arbitrarily and without reason. In fact the pointed out at the end of the judgment that the act of the was not \"shown to be vitiated by such arbitrariness as should call for interference by the \", recognising clearly that if the rejection of the tender of the 1st respondent were arbitrary, the would have been justified in striking it down as invalid. ", "Now this rule, flowing as it does from Article 14 , applies to every action and since \"\" is defined in Article 12 to include not only and the of each of the s, but also \"all local or other authorities within the territory of India or under the control of \", it must apply to action of \"other authorities\" and they must be held subject to the same constitutional limitation as the . But the question arises what are the \"other authorities\" contemplated by Article 12 which fall within the definition of '' ? on this ques- ", "(1) [1974] 3 S. C. R. 64. ", " ", "tion considerable light is thrown by the decision of this Court in (1). That was a case in which this Court was called upon to consider whether was an 'authority' within the meaning of the expression \"other authorities\" in Art. 12. , J., delivering the judgment of the majority pointed out that the expression \"other authorities\" in Art. 12 would include all constitutional and statutory authorities on whom powers are conferred by law. The learned Judge also said that if any body of persons has authority to issue directions the disobedience of which would be punishable as a criminal offence, that would be an indication that that authority is ''. , J., who delivered a separate judgment, agreeing with the conclusion reached by the majority, preferred to give a slightly different meaning to the expression \"other authorities\". He said that authorities, constitutional or statutory, would fall within the expression \"other authorities\" only if they are invested with the sovereign power of the , namely, the power to make rules and regulations which have the force of law. The ratio of this decision may thus be stated to be that a constitutional or statutory authority would be within the meaning of the expression \"other authorities\", if it has been invested with statutory power to issue binding directions to third parties, the disobedience of which would entail penal consequence or it has the sovereign power to make rules and regulations having the force of law. This test was followed by , C.J., in (supra). , J., however, in the same case, propounded a broader test, namely, whether the statutory corporation or other body or authority, claimed to fall within the definition of ', is as instrumentality or agency of Government: if it is, it would fall within the meaning of the expression 'other authorities' and would be '. Whilst accepting the test laid down in (supra), and followed by , C. J., in (supra), we would, for reasons already discussed, prefer to adopt the test of Governmental instrumentality or agency as one more test and perhaps a more satisfactory one for determining whether a statutory corporation, body or other authority falls within the definition of ''. If a statutory corporation, body or other authority is an instrumentality or agency of Government, it would be an 'authority' and therefore '' within the meaning of that expression in Article 12. ", "It is necessary at this stage to refer to a few decisions of this Court which seem to bear on this point and which require a little (1) [1967] 3 S C, R 377 11-904 SCI/79 explanation. The first is the decision in .(1) This was a case in which some of the workmen sought a writ of mandamus against which was a company with 56 per cent of its share capital held by , 32 per cent by and 12 per cent by private individuals. The Court held that a writ of mandamus did not lie, because \"being a non statutory body and one incorporated under the Companies Act , there was neither a statutory nor a public duty imposed on it by a statute in respect of which enforcement could be sought by means of mandamus, nor was there in its workmen any corresponding legal right for enforcement of any such statutory or public duty.\" (emphasis supplied). It is difficult to see how this decision can be of any help in deciding the present issue before us. This was not a case where claimed to be an instrumentality of government or an 'authority' within the meaning of Article 12. The only question was whether a writ of mandamus could lie and it was held that since there was no duty imposed on by statute, no writ of mandamus could issue against it. ", "The second decision to which we must refer is that in (2). The question which arose in this case was whether a reference of an industrial dispute between (hereinafter referred to as the '') and the made by the State of Bihar under section 10 of the Industrial Disputes Act, 1947 was valid. The argument of the was that the industry in question was \"carried on under the authority of \" and the reference could, therefore, be made only by . The held that the words \"under the authority\" mean \"pursuant to the authority, such as where an agent or a servant acts under of pursuant to the authority of his principal or master\" and on this view, the addressed itself to the question whether the could be said to be carrying on business pursuant to the authority of . The answer to this question was obviously 'no' because the was carrying on business in virtue of the authority derived from its memorandum and articles of association and not by reason of any authority granted by . The , in carrying on business, was acting on its own behalf and not on behalf of and it was therefore not a servant or agent of in the sense that its actions would bind . There (1) 3 S. C. R. 773, (2) 3 S. C. R 995. ", "1051 ", "was no question in this case whether the was an instrumentality of and therefore an 'authority within the meaning of Article 12. We may point out here that when we speak of a being an instrumentality or agency of , we do not mean to suggest that the should be an agent of the in the sense that whatever it does should be binding on the . It is not the relationship of principal and agent which is relevant and material but wether the is an instrumentality of the in the sense that a part of the governing power of the is located in the and though the is acting on its own behalf and not on behalf of the , its action is really in the nature of action. This decision dealing with an altogether different point has no bearing on the present issue. ", "We may then refer to the decision in .(1) This decision has also no relevance to the point at issue before us, since the only question in that case was wether all Assistant Surgeon in the employment of could be said to be holding a civil post under the or a so as to be entitled to the protection of Article 311(2) of the Constitution. The held that was not a department of the nor were its employees holding posts under the within the meaning of Article 311(2). The decision was clearly right and indeed it could not be otherwise since , which was a distinct and independent legal entity, was not a department of the and could not be regarded as for the purpose of Article 311(2). It may be noted that the was not concerned with the question whether was an 'authority' within the meaning of Articlc 12. ", "Lastly, we must refer to the decision in v. ) where the question was whether was an 'authority' within the meaning of Article 12. The Court no doubt took the view on the basis of facts relevant to the constitution and functioning of the council that it was not an 'authority', but we do not find any discussion in this case as to what are the features which must be present before a corporation can be regarded as an 'authority' within the meaning of Article 12. This decision does not lay down any principle or test for the purpose of determining when a corporation can be said to be an 'authority'. If at all any test can be gleaned from the decision, it is (1) 3 S. C. R. 363. ", "(2) [1975] 1 S. C. C. 485. ", "1052 ", "whether the is 'really an agency of the Government\". The Court seemed to hold on The facts that the was not an agency of the Government and was, therefore, not an 'authority'. ", "We may examine, in the light of this discussion, whether the 1st respondent, namely, ,, can be said to be an authority falling within the definition of 'State' in Article 12. It is necessary to refer to some of the provisions of the International Airport Authority Act, 1971 (hereinafter referred to as the Act) for the purpose of determining this question. Sub-section (1) of section 3 of the Act provides that shall constitute an authority to be called , to whom we shall hereafter refer as the 1st respondent. Sub- section (2) states that the 1 st respondent shall be a body corporate having perpetual succession and a common seal and sub-section (3) enacts that the Ist respondent shall consist of a Chairman to be appointed by , the Director General of Civil Aviation exofficio and not less than six and not more than thirteen members to be appointed by . The term of office of every member of the 1st respondent is prescribed by sub-section (1) of section 5 to be 3 years, but is given under the power to terminate the appointment of any member who is not a servant of the Government after giving him notice as also to terminate at any time the appointment of any member who is a servant of the Government. The power to remove a member in certain specified circumstances is also vested in under section 6 . Section 32 , sub-section (1) provides that as from the date appointed by all properties and other assets vested in the p Central Government for the purposes of the airport and administered by the Director General of Civil Aviation immediately before such date shall vest in the 1st respondent and all debts, obligations and liabilities incurred, all contracts entered into and all matters and things engaged to be done by, with or for immediately before such date shall be deemed to have been incurred, entered into and engaged to be done by, with or for the 1st respondent. This sub-section also says that all non-recurring expenditure incurred by for or in connection with the purposes of the airport upto the appointed date and declared to be capital expenditure by shall be treated as the capital provided by to the 1st respondent and all sums of money due to in relation to the airport immediately before the appointed date shall be deemed to be due to the 1st respondent. The 1st respondent is also given the power to institute or continue all suits and other legal proceedings instituted or which could have been instituted by or against for any matter in relation to the airport and every employee holding any office under immediately before the appointed date solely or mainly for or in connection with the affairs of the airport shall be treated as on deputation with the 1st respondent. Sub-section (1) of section 12 also enacts similar provisions with regard to the air navigation services and the buildings used exclusively for such services immediately before the appointed date. The functions of the 1st respondent are specified in section 16 : sub-section (l) provides that, subject to the rules, if any, made by in this behalf, it shall be the function of the 1st respondent to manage the airports efficiently and sub-section (2) casts an obligation on the 1 st respondent to provide at the airports such services and facilities as are necessary or desirable for the efficient operation of air transport services and certain specific functions to be performed by the 1st respondent are particularised in sub-section (3). These. functions were, until the appointed date, being carried out by but now under Section 16 they are transferred to the ] st respondent. Section 20 provides that after making provision for reserve funds, bad and doubtful debts, depreciation in assets and an other matters which are usually provided for by companies, the 1st respondent shall pay the balance of its annual net profits to . Section 21 requires the 1st respondent to submit for the approval of a statement of the programme of its activities during the forthcoming financial year as well as its financial estimate in respect thereof at least three months before the commencement of each financial year and section 24 provides that the accounts of the 1st respondent shall be audited annually by the Comptroller and Auditor General and the accounts as certified by the Comptroller and Auditor General or any other person appointed by him in this behalf, together with the audit report thereon, shall be forwarded to and shall cause the same to be laid before both Houses of Parliament. The 1st respondent is also required by section 25 to prepare and submit to , as soon as may be after the end of each financial year, a report giving an account of its activities during the financial year and this report has to be laid before both Houses of Parliament by . The officers and employees of the 1st respondent are deemed by section 28 to be public servants and section 29 gives them immunity from suit, prosecution or other legal proceeding for anything in good faith done or intended to he done in pursuance of the Act or any rule or regulation made under it. Section 33 confers power on to temporarily divest the 1st respondent from the management of any airport and to direct the 1st respondent to entrust such management to any other person. is also empowered by section 34 lo supersede the 1st respondent under certain specified circumstances. Section 35 gives power to to give directions in writing from time to time on questions of policy and provides that the 1 st respondent shall in the discharge of its functions, and duties, be bound by such directions. Section 36 confers rule making power on for carrying out the purposes of the Act and power to make regulations is conferred on the 1st respondent under section 37 . Section 39 provides that any regulation made by the 1st respondent under any of the clauses (g) to ", "(m) of sub-section (2) of section 37 may make it Penal to contravene such regulation. ", "lt will be seen from these provisions that there are certain features of the 1 st respondent which are eloquent and throw considerable light on the true nature of the 1st respondent. In the first place, the chairman and members of the 1st respondent are all persons nominated by and has also the power to terminate their appointment as also to remove them in certain specified circumstances. is also vested with the power to take away the management of any airport from the 1st respondent and to entrust it to any other person or authority and for certain special reasons, can also supersede the Ist respondent. has also power to give directions in writing,, from time to time on questions of policy and these directions are declared binding on the 1st respondent. The 1st respondent has no share capital but the capital needed by it for carrying out its functions is provided wholly by . The balance of the not profit made by the Ist respondent after making provision for various charges, such as reserve funds, had and doubtful debts depreciation in assets etc. does not remain with the 1st respondent and is required to be paid over lo . The 1st respondent is also required to submit to for its approval a statement of the programme of its activities as also the financial estimate and it must follow as a necessary corollary that the 1 st respondent can carry out only such activities and incur only such expenditure as is approved by . The audited accounts of the 1st respondent together with the audit report have to be forwarded to and they are required to be laid before both Houses of . So far as the functions of the 1st respondent are concerned, the entire department of relating to the administration of airports and air nevigation services together with its properties and assets, debts, obligations and liabilities, contracts, causes A of action and pending litigation is transferred to the 1st respondent and the 1st respondent is charged with carrying out the same functions which were, until the appointed date, being carried out by . The employees and officers on the 1st respondent are also deemed to be public servants and the 1st respondent as well as its members, officers and employees are given immunity for anything which is in good faith done or intended to be done in pursuance of the Act or any rule or regulation made under it. The 1st respondent is also given power to frame Regulations and to provide that contravention of certain specified Regulations shall entail penal consequence. These provisions clearly show that every test discussed above is satisfied in the case of the 1st respondent and they leave no doubt that the 1st respondent is an instrumentality or agency of and falls within the definition of 'State' both on the 'narrow view taken by the majority in (supra) as also on the broader view of , adopted by us. ", "It is, therefore, obvious that both having regard to the constitutional mandate of Article 14 as also the judicially evolved rule of administrative law, the 1st respondent was not entitled to act arbitrarily in accepting the tender of the 4th respondents, but was bound to conform to the standard or norm laid down in paragraph 1 of the notice inviting tenders which required that only a person running a registered IInd Class hotel or restaurant and having at least S years' experience as such should be eligible to tender. It was not the contention of the appellant that this standard or norm prescribed by the 1st respondent was discriminatory having no just or reasonable relation to the object of inviting tenders namely, to award the contract to a sufficiently experienced person who would be able to run efficiently a IInd class restaurant at the airport. Admittedly the standard or norm was reasonable and non-discriminatory and once such a standard or norm for running a IInd Class restaurant should be awarded was laid down, the 1st respondent was not entitled to depart from it and to award the contract to the 4th respondents who did not satisfy the condition of eligibility prescribed by the standard or norm. If there was no acceptable tender from a person who satisfied the condition of eligibility, the 1st respondent could have rejected the tenders and invited fresh tenders on the basis of a less stringent standard or norm, but it could not depart from the standard or norm prescribed by it and arbitrarily accept the tender of the 4th respondents. When the 1st respondent entertained the tender of the 4th respondents even though they did not have 5 years' experience of running a IInd Class restaurant or hotel, denied equality of opportunity to others similarly situate in the matter of tendering for the contract. There might have been many other persons, in fact the appellant himself claimed to be one such person, who did not have 5 years' experience of running a IInd Class restaurant, but who were otherwise competent to run such a restaurant and they might also have competed with the 4th respondents for obtaining the contract, but they were precluded from doing so by the condition of eligibility requiring five years' experience. The action of the 1st respondent in accepting the tender of the 4th respondents, even though they did not satisfy the prescribed condition of eligibility, was clearly discriminatory, since it excluded other person similarly situate from tendering for the contract and it was plainly arbitrary and without reason. The acceptance of the tender of the 4th respondents was, in the circumstances invalid as being violative of the equality clause of the Constitution as also of the rule of administrative law inhibiting arbitrary action. ", "Now, on this view we should have ordinarily set aside the decision of the,- 1st respondent accepting the tender of the 4th respondents and the contract resulting from such acceptance but in view of the peculiar facts and circumstances of the present case, we do not think it would be a sound exercise of discretion on our part to upset that decision and void the contract. It does appear from the affidavits filed by the parties that the appellant has no real interest in the result of the litigation, but has been put up by for depriving the 4th respondents of the benefit of the contract secured by them. We find that a number of proceedings have been instituted for this purpose from time to time by either personally or by instigating others to take such proceedings. The first salvo in the battle against the 4th respondents was fired by , proprietor of , who filed a suit challenging the decision of the 1st respondent to accept the tender of the 4th respondents, but in this suit he failed to obtain an interim injunction and his appeal was dismissed by on 19th October, 1977. It is significant that when the tenders were opened in the office of the Airport Director, was represented by , which shows that either was a nominee of or in any event , proprietor of , was closely connected with . Moreover, it is interesting to note that though the tender of the 4th respondents was accepted as far back as 19th April, 1977, did not adopt any proceedings immediately but filed the suit only after was informed by the Airport Director on 22nd August, 1977 that a final order has been received from the Ministry requiring to immediately close down his restaurant and snack bars. It is also a circumstance not without significance that did not immediately take any proceeding for challenging the acceptance of the tender of the 4th respondents, but filed a suit in his own name only after the appeal of was dismissed by on 19th October, 1977. These circumstances clearly indicate that the suit was filed by at the instance of or in any event in concert with him and when the suit of failed to achieve the desired result, stepped into the arena and filed his own suit. This suit was for a mandatory injunction seeking removal of the two snack bars which had in the meantime' been put up by the 4th respondents pursuant to the acceptance of their tender by the 1st respondent. But in this proceeding also failed to obtain an ad- interim injunction. It was only after the failure to obtain interim relief in these two proceedings, one by and the other by , that the appellant filed the present writ petition in of Bombay challenging the decision of the 1st respondent to accept the tender of the 4th respondents. Now, it appears from the record that the appellant was at the material time conducting a restaurant called which was owned in partnership by three persons, namely, , and . is the brother of and he was managing and looking after the restaurant of at the airport. It would, therefore, be a fair inference to make that the appellant was well connected with and from the manner in which proceedings with a view to thwarting the attempt of the 4th respondents to obtain the benefit of their contract, have been adopted one after the other in different names, it does appear that the appellant has filed the writ petition at the instance of with a view to helping him to obtain the contract for the restaurant and the snack bars. It is difficult to understand why the appellant should have waited until 8th November, 1977 to file the writ petition when the tender of the 4th respondents was accepted as far hack as 19th April, 1977. The explanation given by the appellant is that he was not aware of the acceptance of the tender of the 4th respondents but that is a rather naive explanation which cannot be easily accepted It is not possible to believe that the appellant who was so well connected with and did not know that had failed to obtain the contract for running the restaurant and the snack bars and that this contract had been awarded to the 4th respondents as a result of which was being pressed to close down his restaurant and snack bars. We have grave doubts whether this writ petition was commenced by the appellant bona fide with a view to protecting his own interest. Moreover, the writ petition was filed by the appellant more than five months after the acceptance of the tender of the 4th respondents and during this period, the 4th respondents incurred considerable expenditure aggregating to about Rs. 1,25,000/- in making arrangements for putting up the restaurant and the snack bars and in fact set up the snack bars and started running the same. It would now be most inequitous to set aside the contracts of the 4th respondents at the instance of the appellant. The position would have been different if the appellant had filed the writ petition immediately after the acceptance of the tender of the 4th respondents but the appellant allowed a period of over five months to elapse during which the 4th respondents altered their position. We are, therefore, of the view that this is not a fit case in which we should interfere and grant relief to the appellant in the exercise of our discretion under Article 136 read with Article 226 of the Constitution. ", "We accordingly dismiss the appeal and confirm the order of rejecting the writ petition. But in the circumstances of the case there will be no order as to costs throughout. ", "P.B.R Appeal dismissed."], "relevant_candidates": ["0000014624", "0000312295", "0000426032", "0000459864", "0000499384", "0000743328", "0000764006", "0001080534", "0001295840", "0001327287", "0001605374", "0001766147", "0001924249"]} {"id": "0001333489", "text": ["PETITIONER: WORKMEN OF MESSRS FIRESTONE TYRE &RUBBER COMPANY OF INDIA (P Vs. RESPONDENT: MANAGEMENT & OTHERS (With connected appeals) DATE OF JUDGMENT06/03/1973 BENCH: VAIDYIALINGAM, C.A. BENCH: VAIDYIALINGAM, C.A. DUA, I.D. CITATION: 1973 AIR 1227 1973 SCR (3) 587 1973 SCC (1) 813 CITATOR INFO : R 1974 SC 136 (18) R 1974 SC 696 (5) R 1975 SC1892 (4) RF 1975 SC1900 (19) R 1975 SC2025 (7) R 1978 SC1004 (12) R 1978 SC1380 (8) R 1979 SC1064 (11) R 1979 SC1652 (25,27,28,35) F 1984 SC1805 (16) RF 1986 SC 842 (5,15) ACT: Industrial Disputes Act 1947 as amended by Industrial Disputes (Amendment) Act 1971- Section 11A , interpretation of-Power of how far modified-Section whether applicable to disputes referred before 15-12-71, when it came into force. HEADNOTE: The Industrial Disputes (Amendment) Act 1971 inter alia introduced s. 11A into the parent Act of 1947. The new section provided that if in the course of the adjudication of an Industrial dispute relating to the discharge or dismissal of a workman , , or National is satisfied that the order of discharge or dismissal was not justified, it may, by its award, set aside the order of discharge or dismissal and direct reinstatement of the workmen or reduce punishment etc. The proviso to the section laid down that in any proceeding under the section the or in question shall rely only on the materials on record and shall not take any fresh evidence in relation to the matter. The section came into force with effect from December 15, 1971. In the present appeals by special leave the two questions that arose for consideration were : (i) whether s. 11 A had made any changes in the existing legal situation as laid down by this and if so, to what extent-, (ii) whether the section was applicable to industrial disputes which had been already referred for adjudication and were pending as on December 15, 1972. HELD : (i) The statement of objects and reasons cannot be taken into account for the purpose of interpreting the plain words of the section. But it gives an indication as to what the wanted to achieve. [608 A-B] (ii) The Act is a beneficial piece of legislation enacted in the interest of employees. it is well settled that in construing the provisions of a welfare legislation, courts should adopt, what is described as a beneficent rule of construction. If two constructions are reasonably possible to be placed on the section, it follows that the construction which furthers the policy and object of the Act and is more, beneficial to the employees has to be preferred. The interpretation must be liberal enough to achieve the legislative purpose. It must still be in accordance with the plain words, of the statute or the section and must not do violence to the language used by the legislature. it will further have to be found from the words of the section whether it has altered the entire law as laid down in the existing decisions and, if so, whether there is a clear expression of that intention in the language of the section. [608 G-H; 609 A-C] (iii)Both in respect of cases where a domestic enquiry has been held as also in cases when the considers the matter on the evidence adduced before it for the first time, the satisfaction under s. 11A , about the guilt or otherwise of the workmen concerned is that of the . It has to consider the evidence and come to a conclusion one way or other. Even in cases where an enquiry has been held by an employer and a finding of misconduct arrived at, the can now differ from that finding in a proper case and hold that no misconduct is proved. [611 A-C] The contention that the stage for interference under section 11A by the is reached only when it has to consider the punishment after 588 having accepted the finding of guilt recorded by the employee, could not be accepted., The under s. 11A can consider the question of guilt as well as of punishment. It can also alter the punishment imposed by an employer. [611 C-H; 612 A-B] It was specifically contended before the in Workmen of Motipur Sugar Factories (Private) Limited, that when an employer had held no enquiry as required by the Standing Orders, it was not open to him to adduce evidence before the for the first time and justify the order of discharge. This contention was rejected by this and it was held that if the enquiry was defective or no inquiry had been held, as required by the Standing Orders, the entire case would be open before the and the, employer would have to justify, on evidence as well that its order of dismissal or discharge was proper. There is no provision either in the Industrial Employment (Standing Orders) Act 1948 or in the Industrial Disputes Act which states that an order of dismissal or discharge is illegal if it is not recorded by a proper and valid domestic enquiry. Therefore, the contention that such 'an enquiry being illegal, the has now under s. 11A no alternative but to order reinstatement could not be accepted. Moreover the Industrial Disputes Act cannot be differently applied to employees who are governed by the Stand Orders Act and those who are not governed by it. [612 H; 613 A-G] The expression 'materials on record' occurring in the proviso to s. 11A cannot be confined only to the materials which were available at the domestic enquiry. On the other hand the 'materials on record' in the proviso must be held to refer to materials on record before the . They take in (1) the evidence taken by the management at the enquiry and the proceedings of the enquiry, or (2) the above evidence and in addition any further evidence led before the , or (3) evidence placed before the for the first time in support of the action taken by the employer as well as the evidence adduced by the workmen contra. The expression 'fresh evidence' has to be read in the context in which it appears, namely, as distinguished from the expression 'materials on record'. The , for the purpose of determining the question of misconduct or punishment or relief to be granted to workmen, has to act only on the basis of the , materials on record' before it and. cannot call for fresh evidence as an appellate authority can normally do. [613H; 614 A-H; 615A-D] (iv)The words \"in a proceeding under this section\" in the proviso. to s. 11A are very significant. There cannot be a \"proceeding under this section\" before the section has come into force. A proceeding under that section can only be on or after 15-12-1971. T at also gives an indication that section 11A applies only to disputes which are referred for adjudication after the section has come into force. There are no express words in s. 11A which would make it applicable even to disputes referred before it came into force nor could such an inference be gathered by necessary intendment, The section therefore does not apply to proceed- ings before 15-12-1971. [619 E-G; 622 D-G] The following cases were referred to in the judgment (1) S.C.R. 667, by its Managing Agents , Madras v. Workmen of the Company represented by and , Labour Appeal Cases 490, Shri Ram Swarath Singh , Muzafferpur v. The Management of , , Muzafferpur, Labour Appeal Cases 697; The Punjab Na- 589 tional 1 S.C.R. 806, , 3 S.C.R. 684, , , 3 S.C.R. 461, , 3 S.C.R. 506, , 3 3.C.R. 588, ., 1 S.C.R. 755, , 1 L.L.J. 180. 1 S.C.R. 742, , S.C.R. 488, ., 3 S.C.R. 623 The State of Maharashtra v., Vishnu Ramachandra, 2 S.C.R. 26, Barber v. , 1, All., E.R. 115, v. Molak I.L.R. 1948 (11) Cal. 209, v. , Factory Manager, , Nagpur Ltd., 2 S.C.R. 660, 2 S.C.R. 159, and . 2Q.B. 547., JUDGMENT: ", "CIVIL APPELLATE JURISDICTION : Civil Appeal No. 1461 of 1972. ", "Appeal by special leave from the judgment and order dated April 21, 1972 of , Maharashtra in I.T. No. 307 of 1968. ", ", and , for the appellant (in C.A. No. 1461). ", ", and , for the respondent No. 1 (in C.A. No. 1461). ", ", , , , , , for the Interveners ( & ). ", ", for the intervener (). , , and for the appellant. (in C.A. No. 1995). , and , for the appellant (in C.A. No. 1996). ", "590 ", " and , for the respondents. (in C.A. Nos. 1995-96 and C.A. No. 2386) and for the Intervener () (in C.A. No. 1461). ", "The Judgment of the Court was delivered by In these appeals, by special leave, two common questions arise for consideration :- (1) proper interpretation of section 11A of the Industrial Disputes Act; and (2) whether the above section applies to industrial dis- putes which have already been referred to for adjudication and were, pending as on 15-12-1971. ", "Section 11A was incorporated in the Industrial Disputes Act 1947 (hereinafter referred to as the Act) by section 3 of the Industrial Disputes (Amendment) Act 1971 (hereinafter referred to as the Amendment Act ). The Amendment Act passed by , received the assent of the President on December 8, 1971. Sub- section 2 of section 1 provided for its coming into force on, such date as by notification in the official gazette, appoints. by notification No. F.S.- 11013/1/71-LR.I dated 14-12-1971 appointed the 15th day of December, 1971, as the date on which the said Act would come into force. Accordingly, the Amendment Act came into force with effect from December 15, 1971. The Amendment Act introduced various amendments to the Act. In particular by section 3 , it inserted the new section 11A in the Act. The new section 11 A so inserted runs as follows Powers of Labour Courts, s and National s to give appropriate relief in case of discharge or dismissal of workmen \"11 A. Where an industrial dispute relating to the discharge or dismissal of a workman has been referred to ., or National for adjudication and; in the course of the adjudication proceedings, , or National , as the case may be, is satisfied that the order of discharge or dismissal was not justified, it may, by its award, set aside the order of discharge or dismissal and direct reinstatement of the workman on such terms and conditions, if any, as it thinks fit, or give such other relief to the workmen including the award of any lesser punishment in lieu of discharge or dismissal as the circumstances of the case may require; ", "591 ", "Provided that in any proceeding under this section , or National , as the case may be, shall rely only on the materials on record and shall not take any fresh evidence in relation to the matter\". Regarding section 11A , in the Statement of objects and reasons it is stated as follows:- \"In and another v. their workmen (AIR 1958 S.C. 130 at ", "138), , while considering the 's power to interfere with the management's decision to dismiss, discharge or terminate the services of a workman, has observed that in case of dismissal on miscon- duct, the does not act as a court of appeal and substitute its own judgment for that of the management and that the will interfere only when there is want of good faith, victimisation, unfair labour practice, etc. on the part of the management. ", ", in its recommendation (No. 119) concerning termination of. employment at the initiative of the employer adopted in June 1963, has recommended that a worker aggrievad by the termination of his employment should be en7 titled, to appeal against the termination among others, to a neutral body such as an arbitrator, a court, an arbitration committee or a similar body and that the neutral body concerned should be empowered to examine the reasons given in the termination of employment and the other circumstances relating to the case, and to render a decision on the justification of the termination. has further recommended that the neutral body should be empowered (if it finds that the termination of employment was unjustified) to order that the worker concerned, unless reinstated with unpaid wages, should be paid adequate com- pensation or afforded some other relief. In accordance with these recommendations, it is considered that the 's power in an adjudication proceeding relating to discharge or dismissal of a workman should not be limited and that the should have the power in cases wherever necessary, to set aside the order of discharge or dismissal and direct reinstatement of the workman on such terms and conditions, if any, as it thinks fit or give such other relief to the workmen including the award of any lesser punishment in lieu of discharge or dismissal as the circumstances of the 5 9 2 case may require. For this purpose, a new section 11A is proposed to be inserted in the Industrial Disputes Act , 1947............... There is no controversy that in all the four appeals,, the reference had been-made long before the date of coming into force ,of section 11A and the industrial disputes were pending adjudication at the hands of the concerned authorities on 15-12-1971. In respect of such disputes the concerned labour court or had to consider the question whether section 1 1 A applies to those proceedings and also the further question as to the powers to be exercised by them in respect of such disputes. On behalf of the companies, it appears to have been urged that the section does not apply to the disputes which had already been referred to for adjudication and that the management had a right to adduce evidence to justify the action taken against the workmen even though no enquiry had been held before the order of discharge or dismissal had been passed and also in cases where the enquiry held is found to be defective. This claim was resisted on behalf of 'the labour on the ground that the section applies to all proceedings which were pending as on 15-12-1971 and that the management, 'if it had not held any enquiry. or if the enquiry conducted by it was found to be defective, has no right to adduce, evidence before the authority to justify its action. Different views have been expressed by the s concerned as will be seen from what is stated below :- ", "In Civil Appeal No. 1461 of 1972, the Reference (I.T.) No. 307 of 1968 related to the question of reinstatement of a number of workmen, who had been dismissed. , Maharashtra, Bombay, considered the question whether section 11A applies to the reference, which had been made as early as 12th August, 1968. by its order dated April 21, 1972 has held that the restrictions imposed upon the, powers of or to interfere with orders of dismissal passed by the management, have been removed by section 11A , which has the effect of affecting the substantive part of the law of master and servant and, therefore, the said section has no retrospective effect. The has held that the con- cerned reference will have to be disposed of as though section 11A was not in the statute. The workmen have come up in appeal. ", "Civil Appeal No. 1995 of 1972 arises out of the order dated 28-6-1972.of in Reference (I.D.A.) No. 268 of 1970. has held that section 11A applies even to all, proceedings pending adjudication as on 15-12-1971, as it only deals with matters of procedure. The said Court has further held that the new section makes it clear that there must be a proper enquiry by an employer before dismissing or discharging a workman and that if no enquiry has been held or if the enquiry held is found to be defective, there is no option but to reinstate the employee. In this view, has further held that an employer under those circumstances has no, right to adduce evidence in the adjudication proceedings to justify his action. In civil Appeal No. 1996 of 1972 arising out of Reference (I.D.A.) No. 207 of[1970] and in Civil Appeal No. 2386 of 1972 arising out of Reference (I.D.A.) No' 213 of [1970], the same has expressed similar views in its orders dated June 27, 1972. Against all these three orders the company has filed appeals. ", "The management and the workmen concerned in certain other disputes have also intervened in these appeals and they have placed before us copies of the orders passed by other authorities. It will be useful to refer to the views expressed by some of those authorities. In Reference (I.D.A.) No. 79 of 1971, in its order dated April 13, 1972 has held as follows : Section 11A gives power to to scrutinlse domestic enquiries similar to that of an appellate court. The said section comes into play only after the court has come to a conclusion that the enquiry held by an employer was proper. Both parties have still a right to adduce evidence to prove the legality or otherwise of the domestic enquiry. Even if no enquiry has been held by an employer or if the enquiry is held to be defective, reinstatement cannot be ordered straightway as urged by the labour. On the other hand, an employer has got a right to adduce evidence to justify the action, taken by him. But section 11A deals only with procedural matters and, therefore, it operates retrospectively. ", "Similarly in Reference (I.D.A.) No. 41 of 1956, in its order, dated January 3, 1973, has held that the section is retrospective in its operation and that the employer has got a right to lead evidence before , if the domestic enquiry has not been held or is found to be defective. ", "From what is stated above, it is clear that there is a very wide divergence of views expressed by the various authorities, both regarding the applicability of the section to pending proceedings as well as the interpretation to be placed on the said section. ", "We will first take up the question regarding the proper interpretation to be placed on section 11 A. The contentions of Mr. , learned counsel, who advanced the main arguments in this regard on behalf of the workmen are as follows:- ", "594 ", "Originally limitations had been placed by judicial decisions in respect of the jurisdiction of When considering the action of an employer in the matter of discharge or dismissal of a workmen. It a domestic enquiry had been held by an ,employer on the basis of which a workman is dismissed or discharged, can interfere with the decision of the management only if the domestic enquiry is vitiated by the circumstances mentioned by this Court in & Another v. Their workmen(1). Once the s hold that the domestic enquiry has been 'conducted properly and the ,action of an employer is bona fide and the, conclusions arrived at ,therein are plensible, they had no jurisdiction to substitute their own judgment. In cases where the misconduct is found to be proved by a valid and proper domestic enquiry, the had no power to alter the punishment imposed by an employer. Even in cases where the domestic enquiry is held to be: defective or even if no domestic enquiry had been conducted by an employer before passing an order of termination or discharge, the employer was given an opportunity to adduce evidence before the to justify his action. Once the accepts that evidence and 'holds that the misconduct is proved, it had no power to interfere with the discretion of the management regarding the quantum of punishment. The above position has been completely changed by section 11A . It is now obligatory on an employer to hold a proper domestic enquiry in which all material evidence will have to be adduced. When a dispute is referred for adjudication and it is found that ,-the domestic enquiry conducted by the management is defective ,or if it is found that no domestic enquiry at all had been conducted, the order of discharge or termination passed by the employer becomes, without anything more, 'Unjustified and have no option but to direct the reinstatement of the workmen concerned, as his discharge or dismissal is illegal. Even in cases where a domestic enquiry has been held and finding of misconduct recorded, have now full power and jurisdiction to reappraise the evidence and to satisfy themselves whether the evidence, justifies the finding of misconduct. Even if the enquiry proceedings are held to be proper and the finding of misconduct is also accepted, the has now power to consider whether the punishment of dismissal or discharge was necessary for the, type of misconduct of which the workman is found guilty. In such circumstances, the can also give any other relief to the workman, including the imposing of a 'lesser punishment. In cases where an employer had not conducted any enquiry or when the enquiry conducted by him is held to 'be defective, the employer will not be given any opportunity to (1) S.C.R 67. ", "595 ", "adduce evidence before for justifying his action. Various decisions of this court have emphasised that there is an obligation on the part of an employer to hold a proper enquiry before dismissing or discharging a workman. And it has also been stated that the enquiry should conform to certain well defined principles and that it should not be an empty formality. if the management, being fully aware of this position in law, does not conduct an enquiry or conducts a defective enquiry, the order passed by it is illegal and it cannot take advantage of such illegality or wrong committed by it and seek a further opportunity before the of adducing evidence for the first time. Generally, the Standing Orders also provided for the conduct of an enquiry before imposing a punishment., The Standing Orders have, been held to be statutory terms of conditions of service. If an employer does not conform to the provisions of the Standing Orders he commits an illegality and an order passed, which is illegal, has only to. be straightway set aside by the . Decisions of this Court, while recognising that an opportunity has to be given to an employer to adduce evidence before the for the first time, have not given the importance to the effect of a breach of a statutory obligation committed by an employer in not conducting a proper and valid enquiry as per the Standing Orders. This anomaly has now been removed by the legislature. ", "The above is the line of argument adopted by Mr. . He referred us to, certain decisions of this Court in sup- port of his contentions that the opportunity that was so far directed to be given to an employer to adduce evidence for the first time before the was not by way of recognising a right in an employer but really for the benefit of the workman, who will otherwise be jeopardised by a further enquiry being conducted by the employer after filling up the lacunae that are. found in the original enquiry. He pointed out that when the s have now been clothed with full power to reappraise the evidence adduced in the domestic enquiry, which an employer is under obligation to conduct, and when they have been clothed with powers to hold as unjustified an order of termination because of the enquiry Proceeding being defective or on the ground that no enquiry at all was conducted, the basis for giving an employer an opportunity to add cc evidence before the no longer survives. Mr. was prepared to accept that even now, it is open to the parties, to adduce evidence before the , strictly limited to the validity or otherwise of a domestic enquiry conducted by an employer. The counsel relied very heavily 'on the proviso to section 11A in support of his contention that it is obligatory now for an employer to conduct a proper and valid enquiry before passing an order of dismissal or discharge. ", "596 ", "The, above contentions of Mr. have been adopted by Miss , Mr. and Mr. , counsel_appearing for certain other workmen. Mr. , however, was prepared to take a slightly different stand regarding the proviso to section 1 1 A. According to him only such evidence, which could and should have been produced by the parties in the domestic enquiry, is not allowed to be adduced before the Mr. , learned counsel, who advanced the leading arguments on behalf of the employers broadly contended as follows :- ", "The restrictions imposed upon the jurisdiction exercised by in respect of disputes arising out of orders passed by way of dismissal or discharge, as laid down by this in a number of decisions over a period of years, have not been altered by the new section. The right of an employer to manage his affairs in his own way, provided he does not act arbitrarily is kept intact. The common law relationship of master and servant was recognised, except to the extent that it was modified by the decision of this in v. Their workmen(1). An employer is expected to hold a domestic enquiry before an order of dismissal or termination is passed. He is also bound to follow, in such cases, the principles of natural justice and the procedure laid down by the relevant Standing Orders. The will not interfere with the finding recorded by an employer in a proper enquiry merely on the ground that it would have come to a different conclusion. The punishment. to be noted out was entirely within the powers and jurisdiction of an employer and it was no part of the jurisdiction of a to, decide whether the said punishment was justified except in very rare cases where the punishment imposed is grossly out of proportion, so as to suggest victimisation or unfair labour practices. This was the position vis-a-vis the management as on 15-12-1971. But under section 11A , after the holds that the enquiry has been conducted properly by an employer and that the finding about misconduct is correct, it has jurisdiction to consider whether the punishment requires modification. If it holds that the punishment has to be modified, it has power to do so and award a lesser punishment. Section II A' comes into effect only at the time when the consi- ders about the punishment to be imposed. While previously the had no power to interfere with the punishment, it is now clothe with such a power. This is the only modification regarding the powers of the management that has been introduced by section 11 A. Neither the fact that no enquiry at all has been held by an employer nor the circumstance that the enquiry, if any (1) S.C.R. 667. ", "597 ", "held, is found to be detective, stands in the way of an employer adducing evidence before the for the first time to justify his action taken against a workman. Mr. , learned counsel, appearing for adopted these contentions of Mr. . He, however, referred us to the provisions of section 33 of the Act. According to him when the previous permission or an approval for dismissing discharging a workman has been obtained under section 33 , the concerned would have applied its mind and satisfied itself at least prima facie that the proposed action of the employer was justified. Such satisfaction may be arrived at on perusal of the records of domestic enquiry, if one had been conducted or on the basis of evidence Placed before the by an employer for the first time. The said order of dismissal or discharge can nevertheless be the subject of an industrial dispute. When such dispute is being adjudicated by the , the records pertaining to the proceedings under section 33 will be relied on by an employer as material on record. It will lead to an anomaly if it is held that the can straightaway order reinstatement merely because no domestic enquiry has been held or the domestic, enquiry conducted is defective for one reason or other. Therefore, he pointed out that the proper way of interpreting section 11A would be to hold that it comes into play after a has held the enquiry proceedings conducted by the management to be proper and the finding of guilt justified. It is then that the can consider whether the punishment imposed is justified. if it is of the opinion that the punishment is not justified, it can alter the same. ", "We have broadly indicated above the stand taken on behalf of the workmen and the employers regarding the interpretation of section 11A . ", "Before we proceed to consider the contents of the section, having due regard to the arguments advanced before us, it is necessary to indicate the legal position as on 15-12-1971 regarding the powers of or when deciding a dispute arising out of dismissal or discharge of a workman. There are several decisions of this , as also of the Labour Appellate laying down the principles in this regard, but we will refer only to a few of them. ", "In its very early decision in , by its Managing Agents , Madras v. represented by and Madras, Textile Workers Union(1), ", "(1) [1952] Labour Appeal Cases 490. ", "-L761 Sup CI73 late Tribunal held that the decision of the Management in relation to charges against the employee will not prevail if ", "(a) there is want of bona fide, or ", "(b) it is a case of victimisation or unfair labour practice or violation of the principles of natural justice, or ", "(c) there is a basic error of facts or, ", "(d) there has been a perverse finding on the materials. It was further laid down, that an employer ought to have the right to decide what the appropriate punishment for a misconduct should be and its exercise of the discretion in this regard should not be interfered with by a unless the punishment is unjust. In , , Muzafferpur v. , Muzaffarpur(1), the Labour Appellate has recognised the right of a management to ask for permission to adduce evidence for the first time before the to justify its action though no domestic enquiry had been held by it. It has been emphasised that the permission asked for cannot be thrown out in limine on the ground that the management had not made any previous enquiry into the charge. We may say that this decision was in respect of a proceeding under section 33 of the Act, but, as held by this Court, there is no difference in such matters whether the was deciding a dispute referred to it under section 10 or an application filed before it under section 33 of the Act. ", "In discussing the nature of the jurisdiction exercised by when adjudicating a dispute relating to dismissal or discharge, it has been emphasised by this Court in ) as follows : ", "\"Undoubtedly, the management of a concern has power to direct its own internal administration and discipline; but the power is not unlimited and when a dispute arises, have been given the power to see whether the termination, of service of a workman is justified to give appropriate relief. In cases of dismissal on misconduct, the does not, however, act as a Court of appeal and substitute its own judgment for that of the management. It will interfere (i) when there is want of good faith; (ii) when there is victimisation or unfair practice, (iii) when the management has been guilty of a basic error or violation of a principle of natural Justice. and (iv) when on the materials the finding is completely baseless or perverse\". ", "(1) It [1954] Labour Appeal Cases 697. ", "(2) 1958 S.C.R. 667. ", "599 ", "This is the decision which has been referred to in the Statement of objects and reasons already adverted to. It may be noted that the four circumstances pointed out by this Court justifying interference at the hands of the are, substantially the same as laid down by the Labour Appellate in (1). Following the decision in (2)thisCourt in (3) held : ", "\"In cases where an industrial dispute, is raised on the ground of dismissal and it is referred to the, tribunal for adjudication, the naturally wants to know whether the impugned dismissal was preceded by a pro- per enquiry or not. Where such a proper enquiry has been held in accordance with the provisions of the relevant standing orders and it does not appear that the employer was guilty of victimisation or any unfair labour practice, that tribunal is generally reluctant to interfere with the impugned orders\". It was further emphasised that : ", "There is another principle which has to be borne in mind when the tribunal deals with an industrial dispute arising from the dismissal of an employee. We have already pointed out that before an employer can dismiss his employee be, has to hold a proper enquiry into the alleged misconduct of the employee and that such an enquiry must always begin with the supply of a specific charge-sheet to the employee\". ", "The effect of an employer not holding an enquiry has been stated as follows \" But it follows that if no enquiry has in fact been held by the employer, the issue about the merits of the impugned order of dismissal is at large before the tribunal and, on the evidence adduced before it, has to decide for itself whether the misconduct alleged is proved, and if yes, what would be proper order to make. In such a case the point about the exercise of managerial functions does not arise at all\". ", "In M/s. Bharat Sugar Mills Ltd. v. and others(4), the question arose regarding the powers of to permit an employer to adduce evidence before it (1) [1952] Labour Appeal Cases 490, (3) [1960] (1) S.C.R. 806. ", "(2)[1958] S.C.R. 667. ", "(4)[1962] (3) S.C.R. 684. ", "600 ", "justifying its action after the domestic enquiry was held to be defective. It was contended on behalf of the workmen that when once the domestic enquiry was found to be defective, the tribunal had no option but to dismiss the application filed by an employer for approval and that it cannot allow an employer to adduce evidence before it justifying its action. This Court rejected this contention as follows : ", "\"When an application for permission for dismissal is made on the allegation that the workman has been guilty of some misconduct for which the management considers dismissal the appropriate punishment the has to satisfy itself that there is a prima facie case for such dismissal. Where there has been a proper enquiry by the management itself the , it has been settled by a number of decisions of this has to accept the finding arrived at in that enquiry unless it is perverse and should give the permission asked for unless it has reason to believe that the management is guilty of victimisation or has been guilty of unfair labour practice or is acting mala fide. But the mere fact that no enquiry has been held or that the enquiry has not been properly conducted cannot absolve the of its duty to decide whether the case that the work-man has been guilty of the alleged misconduct has been made, out. The proper way of performing this duty where there has not been a proper enquiry by the management is for the to take evidence of both sides in respect of the alleged misconduct. When such evidence is adduced before the the management is deprived of the benefit of having the findings of the domestic tribunal being accepted as prima facie proof of the alleged misconduct unless the finding is perverse and to prove to the satisfaction of the itself that the workman was guilty of the alleged misconduct. We do not think it either just to the management or indeed even fair to the workman himself that in such a case the Industrial should refuse to take evidence and thereby drive the management to make a further application for Permission after holding a proper enquiry and dePrive the workman of the benefit of the itself being satisfied on evidence adduced before it that he was guiltY of the alleged misconduct\". ", "In the above decision, this Court quoted with approval the decision of in Buckingham and (supra) holding that the materials on which a acts may consist of :- ", "\"(1) entirely the, evidence taken by the management at the enquiry and the proceedings of the enquiry, or (2) that evidence and in addition thereto further evidence led before the , or (3) evidence placed before the for the first time in support of the charges\". ", "It was further emphasised--that \"for a long time now, it has been settled law that in the case of in adjudication of a dispute arising out of a dismissal of a workman by the management (as distinct from an application for permission to dismiss under s. ", "33), evidence can be adduced for the first time before . The important effect of the omission to hold an enquiry is merely this : that the tribunal would not have to consider only whether there was a prima facie case but would decide for itself on the evidence adduced whether the charges have really been made out\". ", "The observations made by this Court in (supra) were quoted with approval. It was further held that the reasons for which it is proper for a to take evidence itself as regards the alleged misconduct when adjudicating upon a dispute arising out of an order of dismissal are equally present in a case where the management makes an application for permission to dismiss an employee without holding a proper enquiry. Ultimately, this Court upheld the order of the allowing the employer to adduce evidence before it in support of its application for permission to dismiss an employee even though the domestic enquiry held by it was held to be highly defective. The powers of a when a proper enquiry has been held by an employer as well as the procedure to be adopted when no enquiry at all has been held or an enquiry held was found to be defective, again came up for consideration in Management of Ritz Theatre (P.) (1). Regarding the powers of a when there has been a proper and fair enquiry, it was held : ", "\"It is well-settled that if in employer serve the relevant charge or charges on his employee and holds a proper and fair enquiry, it would be open to him to act (1) [1963] (3) S.C.R. 461. ", "602 ", "upon the report submitted to him by the Enquiry Officer and to dismiss the employee concerned. If the enquiry has been properly held, the order of dismissal passed against the employee as a result of such an enquiry can be, challenged if it is shown that the conclusions reached at the, departmental enquiry were perverse or the impugned dismissal is vindictive or mala fide, and amounts to an unfair labour practice. In such an enquiry before the , it is. not open to the to sit in appeal over the findings recorded at the domestic enquiry. This Court has held that when an proper enquiry has been held, it would be open to the Enquiry Officer holding the, domestic enquiry to deal with the matter on the merits bona fide and come to his own conclusion\". ", "Again regarding the procedure to be adopted when there has been no enquiry or when there has been a defective enquiry, it was stated : ", "\"It has also been held that if it appears that the departmental enquiry held by the employer is not fair in the, sense that proper charge, had not been served on the employee or proper or full opportunity had not been given to the employee to meet the charge, or the enquiry has been affected by other grave irregularities vitiating it, then the position would be that the would be entitled to deal with the merits of the dispute as to, the dismissal of the employee for itself. The same result follows if no enquiry has been held at all. In other words, where the is dealing with a dispute relating to the dismissal of an industrial employee, if it is satisfied that no enquiry has been held or the enquiry which has been held is not proper or fair or that the findings recorded by the Enquiry Officer are perverse, the whole issue; is at large before the, . This position also is well-settled\". ", "It was further held that it is only where a tribunal is satisfied that a proper enquiry has, not been held or that the, enquiry having been held properly the finding recorded is perverse, that the derives jurisdiction to 'deal with the merits of the dispute, when permission has to be given to an employer to adduce additional evidence. The right of an employer to lead evidence before the to justify his action was again reiterated in (1) as follows (1) (3) S.C.R. 506. ", "603 ", "\"It is well settled that if the enquiry is held to be unfair the employer can lead evidence before the and justify his action, but in such a case, the question as to whether the dismissal of the employee is justified or not, would be open before the and the will consider the merits of the dispute and come to its own conclusion without having any regard for the view taken by the management in dismissing the employee\". ", " (1), the employer had charge-sheeted certain workmen and without conducting any enquiry, as required by the Standing Orders, passed orders discharging the workmen. Before the , the employer adduced evidence justifying the action taken against the workmen. The workmen were also given an opportunity to adduce evidence in rebuttal. After a consideration of such evidence, the held that the workmen were guilty of misconduct alleged against them and that the orders of discharge passed by the employer were fully justified. Before this Court it was contended on behalf of the workmen that when no enquiry whatever had been conducted by the employer, as required by the Standing Orders, before passing an Order of dismissal or discharge, the had no jurisdiction to hold an enquiry itself by permitting the employer to adduce evidence be fore it for the, first time in rejecting this contention, it was held \"It is now well-settled by a number of decisions of this Court that where an employer has failed to make an enquiry before dismissing or discharging a workman it is open to him to justify the action before the tribunal by leading all relevant evidence before it. In such a' case the employer would not have the benefit which he has in cases where domestic inquiries have been held. The entire matter would be, open before the tribunal which will have jurisdiction not only to go into the limited questions open to a tribunal where domestic inquiry has been property held but also to satisfy itself on the, facts adduced before it by the employer whether the dismissal or discharge was justified ...... If the enquiry is defective or if no enquiry has been held as required by Standing Orders, the entire case would be open before the tribunal and the employer would have to justify on facts as well that its order of dismissal' or discharge was proper A defective enquiry to our opinion stands on the same (1) (3) S.C.R. 588. ", "604 ", "footing as no enquiry and in either case the tribunal would have jurisdiction to go into the facts and the employer would have to satisfy the tribunal that on facts the order of dismissal or discharge was proper\" ", "The reasons for allowing an employer to lead evidence before the justifying his action have been stated thus : ", "\"If it is held that in cases where the employer dismisses his employee without holding an enquiry, the dismissal must be set aside by the industrial tribunal only on that ground, it would inevitably mean that the employer will immediately proceed to hold the enquiry and pass an order dismissing the employee once again. In that case, another industrial dispute would arise and the employer would be entitled to rely upon the enquiry which he had held in the meantime. This course would mean delay and on the second occasion it will entitle the employer to claim the benefit of the domestic enquiry. On the other hand, if in such cases the employer is given an opportunity to justify the impugned dismissal on the merits of his case being considered by the tribunal for itself and that clearly would be to the benefit of the employee. That is why this has consis- tently held that if the domestic enquiry is irregular, invalid or improper, the tribunal may give an opportunity to the employer to prove his case and in dealing, so the tribunal tries the merits itself. This view is consistent with the approach which industrial adjudication generally adopts with a view to do justice between the parties without relying too much on technical considerations and with the object of avoiding delay in the disposal of industrial disputes. Therefore, we are satisfied that no distinction can be made between cases where the domestic enquiry is invalid and those where no enquiry has in fact been held\". ", "The rights of an employer to avail itself of an opportunity to satisfy the by adducing evidence, when an enquiry held by it was found to be defective or when no enquiry at all has been held, have been stated in . fain & Ors.(1), as follows :- ", "\"It should be remembered that when an order of punishment by way of dismissal or termination of service is effected by the management, the issue that is referred is whether the management was justified in dis- ", "(1) [1972] (1) S.C.R. 755. ", "605 ", "charging and terminating the service of the workman concerned and whether the workman is entitled to any relief. In the present case, the actual issue that was referred for adjudication to has already been quoted in the earlier part of the judgment. There may be cases where an inquiry has been held preceding the order of termination or there may have been no inquiry at all. But the dispute that will be referred is not whether the domestic inquiry has been conducted properly or not by the management, but the larger question whether the order of termination, dismissal or the order imposing punishment on the workmen concerned is justified. Tinder those circumstances it is the right of the workman to plead all infirmities in the domestic inquiry, if one has been held and also to attack the order on all grounds available to him in law and on facts. Similarly the management has also a right to defend the action taken by it on the (,round that a proper domestic inquiry has been held by it-on the basis of which the order impugned has been passed. It is also open to the management to justify on facts that the order passed by it was proper. But the point to be noted is that the inquiry that is conducted by the is a composite inquiry regarding the order which is under challenge. If the management defends its action solely on the basis that the domestic inquiry held by it is proper and valid and if the holds against the management on that point, the management will fail. On the other hand, if the management relies not only on the validity of the domestic inquiry, but also adduce evidence before the justifying its action, it is open to the to accent the evidence adduced by the management and hold in its favour even if its finding is against the management regarding the validity of the domestic inquiry. It is essentially a matter for the management to decide about the stand that it proposes to take before the . It may be em- ", "phasised, that it is the right of the management to sustain its order by adducing also independent evidence before the . It is a right given to the management and it is for the management to avail itself of the said opportunity\". ", "This in its recent decision in (1). after a review of all the earlier cases, has summarised the principles flowing out of those (1) (1) LLJ 180. ", "606 ", "decisions. It has, been emphasised that when no enquiry has been held by an employer or when the, enquiry held has been found to be defective, the employer has got a right to adduce evidence before the justifying its action. The stage at which the employer should invoke the jurisdiction of the to allow him to adduce evidence before it, has also been discussed in the said decision. We have exhaustively referred to the various decisions of this , as they give, a clear picture of the principles governing the jurisdiction of the when adjudicating disputes relating to dismissal or discharge. From those decisions, the following principles broadly emerge (1) The right to take disciplinary action and to decide upon the quantum of punishment are mainly managerial functions, but if a dispute is referred to a ., the latter has power to see if action of the employer is justified. ", "(2) Before imposing the punishment, an employer is expected to conduct a proper enquiry in accordance with the provisions of the Standing Orders, if applicable, and principles of natural justice. The enquiry should not be an empty formality. ", "(3) When a proper enquiry has been held by an employer, and the finding of misconduct is plausible conclusion flowing from the evidence, adduced at the said enquiry, the has no jurisdiction to sit in judgment over the decision of the employer as an appellate body. The interference with the decision of the employer will be justified only when the, findings arrived at in the enquiry are perverse or the management is guilty of victimisation, unfair labour practice or mala fide. ", "(4) Even if no enquiry has been held by an employer or if the enquiry held by him is found to be defective, the in order to satisfy itself about the legality and validity of the order, has to give an oppor- tunity to the employer and employee to, adduce evidence before it. It is open to the employer to adduce evidence for the first time justifying his action; and it is open to the employee to adduce evidence contra. ", "(5) The effect of an employer not holding an enquiry is that the would not have to consider only whether there was a prima facie case. On the other hand, the issue about the, merits of the impugned order of dismissal or discharge is at large before the and the latter, on the evidence adduced before it, has to decide for itself whether the misconduct alleged is proved. In such cases, the point about the exercise of managerial functions does not arise at all. A case of defective enquiry stands on the same footing as no enquiry. ", "(6) The gets jurisdiction. to consider the evidence placed before-it for the first time in justifications of the action taken only, if no enquiry has been held or after the enquiry conducted by an employer is found to be defective. ", "(7) It has never been recognised that the should straightaway, without anything more, direct reinstatement of a dismissed or discharged employee, once it is found that no domestic enquiry has been held or the said enquiry is found to be defective. ", "(8) An employer, who wants to avail himself of the opportunity of adducing evidence for the first time before the to justify his, action, should ask for it at the appropriate stage. If such an opportunity is asked for, the has no power to refuse. The giving of an opportunity to an employer to adduce evidence for the first time before the is in the interest of both the management and the employee, and to enable the itself to be satisfied about the alleged misconduct, (9) Once the misconduct is proved either in the enquiry conducted by an employer or by the evidence placed before a for the first time, punishment imposed cannot be interfered with by the except in cases where the punishment is so harsh as to, suggest victimisation. ", "(10) In a particular case, after setting aside the order of dismissal, whether a workman should be reinstated or paid compensation is, as held by this Court in (1), within' the judicial decision of a Labour Court or . ", "The above was the law as laid down by this Court as on 15-12-1971 applicable to all industrial adjudication arising out of orders of dismissal or discharge. ", "(1) [1971] (1) S.C.R. 742. ", "608 ", "The question is whether section 11A has made any changes in the legal position mentioned above and if so, to what extent ? The Statement of objects and reasons cannot be taken into account for the purpose of interpreting the plain words of the section. But it gives an indication as to what the wanted to achieve. At the time of introducing section 11A in the Act, the legislature must have been aware of the several principles laid down in the various decisions of this referred to above. The object is stated to be that should have power in cases, where necessary, to set aside the order of discharge or dismissal and direct reinstatement or award any lesser punishment. The Statement of objects and reasons has specifically referred to the limitation on the powers of , as laid ,down by this in ). ", "This will be a convenient stage to consider the contents of section 11A . To invoke section 11A , it is necessary that an industrial dispute of the type mentioned therein should have been referred to for adjudication. In the course of such adjudication, the has to be satisfied that the ,order of discharge or dismissal was not justified. If it comes to such a conclusion, tile has to set aside the order and direct reinstatement of the workman on such terms as it thinks fit. The has also power to give any other relief to the work-man including the imposing of a lesser punishment having due re- gard to the circumstances. The; proviso casts a duty on the to rely only on the materials- on record and prohibits it from taking any fresh evidence. Even a mere reading of the section. in our opinion, does indicate that A change in the law, ,is laid ,down by this , has been effected. According to the workmen the entire law has been completely altered; whereas according to the employers, a very minor change has been effected giving power to the , only to alter the punishment, after having hold that the misconduct is proved. That is, according to the employers, the has a mere power to alter the punishment after it holds that the misconduct is proved. The workmen, on the other hand, claim that the law has been rewritten. ", "We cannot accept the extreme contentions advanced on behalf of the workmen and the employers. We are aware that the Act is a beneficial piece of legislation enacted in the interest of employees. It is well settled that in construing the provisions of a welfare legislation, courts should adopt, what is described as a beneficent rule of construction. If two constructions are reasonably possible to be, placed on the section, it follows that the construction which furthers the policy and object of the Act Ind is more beneficial to the employees, has to be preferred. Another principle to be borne in mind is that the Act in question which (1) [1958] S.C.R, 667. ", "609 ", "intends to improve and safeguard the service conditions of an employee, demands an interpretation liberal enough to achieve the. legislative purpose. But we should not also lose sight of another canon of interpretation that a statute or for the matter of that even a particular section, has to be interpreted according to its plain words ind without doing violence to the language used by the legislature. Another aspect to be borne in mind will be that there has been a long chain of decisions of this , referred to exhaustively earlier, laying down various principles in relation to adjudication of disputes by industrial courts arising out of orders of discharge or dismissal. Therefore it will have to be found from the words of the section whether it has altered the entire law, as laid down by the decisions, and, if so, whether there is a clear expression of that intention in the language of the section. We will first consider cases where an employer has held a proper and valid domestic enquiry before passing the order of punishment. Previously the had no power to interfere with its finding of misconduct recorded in the domestic enquiry unless one or other infirmities pointed out by this in ) existed. The conduct of disciplinary proceeding and the punishment to be imposed were all considered to be a managerial function with which the had no power to interfere unless the finding was perverse or the punishment was so harsh as to lead to an inference of victimisation or unfair labour practice. This position, in our view, has now been changed by section 11A . The words \"in the course of the adju- dication proceeding, the is satisfied that the order of discharge or dismissal was not justified\" clearly indicates that the is now clothed with the power to reappraise the evidence in the domestic enquiry and satisfy itself whether the said evidence relied on by an employer, establishes the misconduct alleged against a workman. What was originally a plausible conclusion that could be drawn by an employer from the evidence, has now given place to a satisfaction being arrived at by ,lie that the finding of misconduct is correct. The limitations imposed on the powers of the by the decision in (1). case can no longer be invoked by an employer. The is now at liberty to consider not only whether the finding of misconduct recorded by an employer is 'correct; but also to differ from the said finding if a proper case is made out. What was once largely in the realm of the satisfaction of the employer, has ceased to be so: and now it is the satisfaction of the that finally decides the matter. ", "If there has been no enquiry held by the employer or if the enquiry is held to be defective, it is open to the employer even (1) [1958] S.C.R.667 now to adduce evidence for the first time before the justifying the order of discharge or dismissal. We are not inclined to accept the contention on behalf of the workmen that the right of the employer to adduce evidence before the for the first time recognised by this in its various decisions, has been taken away. There is no indication in the section that the said right has been abrogated. If the intention of the legislature was to do away with such a right, which has been recognised over a long period of years, as will be noticed by the decisions referred to earlier, the section would have been differently worded. Admittedly there are no express words to that effect; and there is no indication that the section has impliedly changed the law in that respect. Therefore, the position is that even now the. employer is entitled to adduce evidence for the first three before the even if he had held no, enquiry or the enquiry held by him is found to be defective. Of course, an opportunity will have to be given to the workman to lead evidence contra. The stage at which the employer has to ask for such an opportunity, has been pointed out by this in Delhi and ) No doubt, this procedure may be time consuming, elaborate and cumbersome. As pointed out by this in the decision just referred to above, it is open to the to deal with the validity of the domestic enquiry, if one has been held as a preliminary 'issue. If its finding on the subject is in favour of the management, then there will be no occasion for additional evidence being cited by the management. But if the finding on this issue is against the management, the will have to give the employer an opportunity to cite additional evidence justifying his action. This right in the, management to sustain its order by adducing independent evidence, before the , if no enquiry has been held or if the enquiry is held to be defective, has bean given judicial recognition over a long period of years. All parties are agreed that even after section 11A , the em- ployer and employee can adduce evidence regarding the legality or validity of the domestic enquiry, if one had been held by an employer. ", "Having held that the right of the employer to adduce evidence continues even under the new section, it is needless to state that, when such evidence is adduced for the first time, it is the which has to be satisfied on such evidence about the guilt or otherwise of the workman concerned. The law, as laid 'down by this Court that under such circumstances the issue about the merits of the impugned order of dismissal or discharge is at large before the and that it has to decide for itself whether the misconduct alleged is proved, continues to have full effect. In (1) [1972] I.L.L.J. 180, such a case, as laid down by this Court, the exercise of managerial functions does not arise at all. Therefore, it will-be seen that both in respect of cases where a domestic enquiry has been held as also in cases where the considers the matter on the evidence adduced before it for the first time, the satisfaction under section 11 A, about the guilt or otherwise of the workman concerned, is that of the . It has to consider the evidence and come to a conclusion one way or other. Even in cases where an enquiry has been held by an employer and a finding of misconduct arrived at, the can now differ from that finding in a proper case and hold that no misconduct is proved. ", "We are not inclined to accept the contentions advanced on behalf of the employers that the stage for interference under section 11 A by the is reached only when it has to consider the punishment after having accepted the finding of guilt recorded by an employer. It has to be remembered that a may 'hold that the punishment is not justified because the misconduct alleged and found proved is such that it does not warrant dismissal or discharge. The may also hold that the order of discharge or dismissal is not justified because the alleged misconduct itself is not established by the evidence. To come to a conclusion either way, the will have to reappraise the evidence for itself. Ultimately it may hold that the misconduct itself is not proved or that the misconduct proved does not warrant the punishment of dismissal or discharge. That is why, according to us, section 11A now gives full power to the to go into the evidence and satisfy-itself on both these points. Now the ,jurisdiction of the to reappraise the evidence and come to its conclusion enures to it when it has to adjudicate upon the dispute referred to it in which an employer relies on the findings recorded by him in a domestic enquiry. Such a power to appreciate the evidence and come to its own conclusion about the guilt or otherwise was always recognised in a when it was deciding a dispute on the basis of evidence adduced before it for the first time. Both categories are now put on a par by section 11 A, Another change, that has been effected by section 11A is the power conferred on a to, alter the punishment imposed by an employer. If the comes to the conclusion that the misconduct is established, either by the domestic enquiry accented by it or by the evidence adduced before it for the. first time, the originally had no power to interfere with the punishment imposed by the management. Once the, misconduct is proved, the had to sustain the order of punishment unless it was harsh indicating victimisation. Under section 11A , though the . may hold that the misconduct is proved, nevertheless it may be of the opinion that the order of discharge or dismissal for the said misconduct is not justified. In other words, the may hold that the proved misconduct does not merit punishment by way of discharge or dismissal. It can, under such circumstances, award to the workman any lesser punishment instead. The power to interfere with the punishment and alter the same has been now conferred on the by section 1 1 A. Mr. rather strenuously urged that in all its pre- vious decisions, this had not considered a breach-or an illegality, as he calls it-committed by an employer in not holding a domestic enquiry. The learned counsel urged that this has consistently held in several decisions that there is an obligation on the part of an employer to conduct a proper domestic enquiry in accordance with the Standing Orders before passing an order of discharge or dismissal. Hence an order passed without such an enquiry is, on the face of it, illegal. The effect of such an illegal order deprives the employer of an opportunity being given to him to adduce evidence for the first time before the to justify his action. These. aspects, according to the learned counsel, have not been considered by this when it recognised an opportunity to be given to an employer to adduce evidence before the . The above aspect was stressed before us by Mr. in support of the contention that section 11A has taken not of such an illegality committed by employers and has now made it obligatory to conduct a domestic enquiry. According to him, if no such proper and valid domestic enquiry precedes the order imposing punishment, the now has no alternative but to order reinstatement on that ground alone. We have already indicated our views regarding the scope of section 11A and held that the right of an employer to adduce such evidence before the has not been taken away. Mr. referred us to section 23 of the Act prohibiting a workman from going on strike in the circumstances mentioned therein and further pointed out that if a strike is illegal, it cannot be lawful'. Similarly, an illegal act of an employer in not holding a domestic enquiry cannot be made legal. ", "In our opinion, the analogy placed before us by the counsel cannot stand scrutiny. It is no doubt true that Standing Orders, which have been certified under the Industrial Employment (Standing Orders) Act 1946, become part of the statutory terms and conditions of service between the employer and his employee and that they govern the relationship between the- parties. But there is no provision either in this statute or in the Act which states that an order of dismissal or discharge is illegal if it is not preceded by a proper and valid domestic enquiry. No- doubt it has been emphasised in the various decisions of this that an employer is expected to hold a proper enquiry before dismissing or discharging a workman. If that requirement is satisfied, an employer will by and large escape the attack that he has acted arbitrarily or mala fide or by way of victimisation. If he has held a proper enquiry, normally his bona fides will be established. But it is not correct to say that this , when it laid down that an employer has a right to adduce evidence for the first time before the , was not aware of a breach committed by an employer of the provisions of the Standing Orders. A similar contention, though in a different form, advanced on behalf of the workmen was rejected by this in ). It was specifically contended before this by the workmen therein that when, an employer had _held no enquiry, as required by the Standing Orders, it was not open to him to adduce evidence before the for the first time and justify the order of discharge. This contention was rejected by this and it was held that if the enquiry was defective or no enquiry had been held, as required by the Standing Orders, the entire case would be open before the and the employer would have to justify, on evidence as well that its order of dismissal or discharge was proper. Therefore, this contention cannot be accepted. We may also state that the industrial Employment (Standing Orders) Act 1946 applies only to those industrial establishments which are covered by section 1(3) . But the field of operation of the Act is much wider and it applies to employers, who may have no standing orders at all. If the contention of Mr. regarding Standing Orders is accepted, then the Act will have to be applied in a different manner to employers, who have no Standing Orders, and employers, who are obliged to have Standing Orders. That is- certainly not the scheme of the Act. We will now pass on to consider the proviso to Section II A. Mr. relied on the terms of the proviso in support of his contention that it is now obligatory to hold a proper domestic enquiry and the can only take into account the materials placed at that enquiry. The counsel emphasised that the proviso places an obligation on the 'to rely only on the materials on record' and it also prohibits the from taking 'any fresh evidence in relation to the matter'. According to him, the expression materials on record' refers to the materials available (1) 3 S.C.R. 588. ", "7--L761Sup.C.I./73 before the management at the domestic enquiry and the expression 'fresh evidence' refers to the evidence that was being adduced by an employer for the first time before the . From the wording of the Proviso, he wants us to infer that the right of an employer to adduce evidence for the first time has been taken away, as the is obliged to confine its scrutiny only to the materials available at the domestic enquiry. ", "We are not inclined to accept the above contention of Mr. . The Proviso specifies matters which the shall take into account as also matters which it shall not. The expression 'materials on record, occurring in the Proviso, in our opinion, cannot be confined only to the materials which were available at the domestic enquiry. On the other hand, the 'materials on record' in the Proviso must be held to refer to materials on record before the . They take in- ", "(1) the evidence taken by the management at the enquiry and the proceedings of the enquiry, or (2) the above evidence and in addition, any further evidence led before the , or (3) evidence placed before the for the first time in support of the action taken by an employer as well as the evidence adduced by the workman contra. ", "The above items by and large should be considered to be the 'materials on record' as specified in the . We are not inclined to limit that expression as meaning only that material that has been placed in a domestic enquiry. The only confines the to the materials on record before it as specified above, when considering the justification or otherwise of the order of discharge or dismissal. It is only on the basis of those materials that the is obliged to consider whether the misconduct is proved and the further question whether the proved mis- conduct justifies the punishment of dismissal or discharge. It also prohibits the from taking any fresh evidence either for satisfying itself regarding the misconduct or for altering the punishment from the it is not certainly possible to come to the conclusion that when once it is held that an enquiry has not been held or is found to be defective, an order reinstating the workman will have to be made by the . Nor does it follow that the deprives an employer of his right to adduce evidence for the first time before the . The expression 'fresh evidence' has to be read in the context in which it appears, namely. as distinguished from the expression materials on record. If so read, the does not prevent any difficulty at all. ", "615 ", "The legislature in section 11A has made, a departure in certain respects in the law as laid down by this Court. For the, first time, power has been given to a to satisfy itself whether misconduct is proved. This is particularly so, as already pointed out by us, regarding even findings arrived at by an employer, in an enquiry properly held. The has also been given power, also for the first time, to interfere with the punishment imposed by an employer. When such wide powers have been now conferred on s, the legislature obviously felt that some restrictions have to be imposed regarding what matters could be taken into account. Such restrictions are found in the Proviso. The Proviso only emphasises that the has to satisfy itself one way or other regarding misconduct, the punishment and the relief to be granted to workmen only on the basis of the 'materials on record' before it. What those materials comprise of have been mentioned earlier. The , for the purposes referred to above. cannot call for further or fresh evidence, as an appellate authority may normally do under a particular statute, when considering the correctness or otherwise of an order passed by a subordinate body. The 'matter' in the Proviso refers to the order of discharge or dismissal that is being considered by the . ", "It is to be noted that an application made,, by an employer under section 33(1) for permission or 33(2) for approval has still to be dealt with according to the principles laid down by this in its various decisions. No change has been effected in that section by the Amendment Act . It has been held by this that even in cases where no enquiry has been held by an employer before passing an order of dismissal or discharge, it is open to him to adduce evidence for the first time before the . Though the is exercising only a very limited jurisdiction under this section, nevertheless, it would have applied its mind before giving permission or approval. Section 33 only imposes a ban. An order of dismissal or discharge passed even with the permission or approval of the can form the subject of a dispute and as such referred for adjudication. Quite naturally, when the dispute is being adjudicated, the employer will rely upon the proceedings that were already held before a under section 33 . They will form part of the materials on record before the . The contention of Mr. that if no enquiry is held. the order of dismissal will have to be set aside, if accepted, will lead to very incongruous results. The would have allowed an employer to adduce, evidence before it in proceedings under section 33 for the first time. even though no domestic enquiry had been 'held. If it is held that another . which adjudicates the main dispute, has to ignore those proceedings and straightaway order reinstatement on the ground that no domestic enquiry had been held by an employer, it will lead to very startling results. Therefore, an attempt must be made to construe section 11A in a reasonable manner. This is another reason for holding that the right to adduce evidence for the first time recognised in an employer, has not been disturbed by section 11A . ", "There may be other instances where an employer with limited number of workman may himself be a witness to a misconduct committed by a workman. He will be disabled from conducting an enquiry against the workman because he cannot both be an enquiry officer and also a witness in the proceedings. Any enquiry held by him will not be in keeping with the principles of natural justice. But he will certainly be entitled to take disciplinary action for which purpose he can serve a charge-sheet and, after calling for explanation, impose the necessary punishment without holding any enquiry. This will be a case, where no enquiry at all has been held by an employer. But the employer will have sufficient material available with him which could be produced before any to satisfy it about the justification for the action taken. Quite naturally, the employer will place before the , for the, first time, in the adjudication proceedings material to support his action. That material will have to be considered by the . But if the contention of Mr. is accepted, then the mere fact that no enquiry has been held, will be sufficient to order reinstatement. Such reinstatement, under the circumstances mentioned above, will, not be doing justice either to the employer or to the workman and will not be conducive to preserving industrial peace. We have indicated the changes effected in the law by section 11 A. We should not be understood as laying down that there is no obligation whatsoever on the part of an employer to hold an enquiry before passing an order of discharge or dismissal. This Court has consistently been holding that an employer is expected to hold a proper enquiry according to the Standing Orders and principles of natural justice. It has also been emphasised that such an enquiry should not be an empty formality. If a proper enquiry is conducted by an employer and a correct finding arrived at regarding the misconduct, the , even though it has now power to differ from the conclusions arrived at by the management, will have to give very cogent reasons for not accepting the view of the employer. Further by holding a proper enquiry, the employer will also escape the charge of having acted arbitrarily or mala fide. It cannot be over emphasised that conducting of a proper and valid enquiry by an employer will conduce to harmonious and healthy relationship between him and the workman and it will serve the cause of industrial peace. Further it will also enable, an employer to persuade the to accept the enquiry as proper and the finding also as correct. ", "Having dealt with the proper interpretation to be placed on section 11A , we will now proceed to consider the second point regarding the applicability of the section to industrial disputes which had already been referred for adjudication and were pending with the on 15-12- 1971 We have earlier referred to the fact that the Amendment Act received the assent of the President on 8th December, 1971. But the Amendment Act did not come into force immediately. It came into force only with effect from December 15, 1971, as per the Notification issued by on 14-12-1971 under section 1 . subjection ", "2. Miss , learned counsel for the appellant workmen, in Civil Appeal No. 1461 of 1972, advanced the main arguments in this regard. Mr. appearing for the workman in the other Appeals, adopted her arguments. According to the learned counsel, section 11A applies not only to references, which are made on or after 15-12-1971, but also to all references already made and which were pending adjudication on that date. It is pointed out that section 11A has been incorporated in Chapter IV of the Act dealing with procedure, powering and duties of authorities. According to them, section 11A deals with matters of procedure. Applying the well known canon of interpretation, procedural laws apply to pending proceedings also. No right, much less any vested right, of the employers has been taken away or affected by section 11A . Considerable stress has been laid on the use of the expressions 'has been referred occurring in section 11A , as conclusively indicating the applicability of the section even to disputes already referred. It was stressed that even assuming that an employer has a right to adduce evidence for the first time before the , that right enures to him only after the had adjudicated upon the validity of the domestic enquiry. It cannot be characterised even as a right, much less a vested right, because it is contingent or dependent upon the 's adjudication on the domestic enquiry. The , when it adjudicates, a dispute on or after 15-12-1971, has to exercise the powers conferred on it by section 11A , even though the dispute may have been referred prior to that date. Hence it is clear that the section applies even to all proceedings pending adjudication on 15-12-1971. ", "Mr. , learned counsel for the employers, contended that retrospective operation should not be given unless it appears very clearly by the terms of the section or arise by necessary and distinct interpretation. The counsel pointed out that the employers would have moulded their behaviour according to the principles laid down by a series of decisions and if the rights recognised in an employer are to be taken away, that can be, done so only by a clear expression to that effect; or such intention to take away or interfere with those rights must appear by necessary intendment. The words of the section clearly show that it applies only to disputes in respect of which a reference is made after the section has come into force i.e. 15-12-1971. The expressions 'has been referred' in the section only signify that on the happening of a particular event, namely, a reference made in future, the powers ,given to the , whatever they may be, can be exercised. Mr. and Mr., learned counsel, appearing for other employers , adopted the contentions of Mr. . A faint argument was also advanced that for section 11-A to apply, even the order of discharge or dismissal should be one passed on or after 15- 12-1971. But this was not pursued, quite rightly in our opinion, in view of the wording of the section. But the main contention on the side of the employers is that the section applies only to disputes which are referred for adjudication on or after 15-12-1971. ", "The learned counsel on both sides have referred us to several decisions where a statute or a section thereof, has been held to be either retrospective or not. They have also referred us to certain passages in text books on interpretation thereof. It is needless to state that a decision has to be given one way or other having regard to the scheme of the statute and the language used therein. Hence we do not propose to refer to those decisions, nor to the passages in the text books, as the principle is well established that a retrospective operation is not to be given to a statute so as to impair an existing right. This is the general rule. But the legislature is competent to pass a statute so as to have retrospective operation, either by clearly expressing such intention or by necessary and distinct intendment. The principles regarding the retrospectively or otherwise of a section or a statute have been laid down by this in (1) and . (2). ", "Miss , learned counsel, placed considerable reliance on the use of the expressions 'has been referred' in section 11A as indicating that the section _Applies even to all references made before 15-12-1971. In our opinion, those words cannot be isolated from the context. The said expressions may have different connotations when they are used in different context. A (1) S.C.R.488. ", "(2) [1968] (3) S.C.R. 623. ", "619 ", "reference may be made to section 7(3) and section 7A(3) of the Act, laying down qualifications for being appointed as a presiding officer of or a respectively. Sub-ection 3 of section 7 enumerates the qualifications which a person should possess for appointment as Presiding Officer of . Section 7(3)(a) & ", "(e) is as follows :- ", "\"A person shall not be qualified for appointment as the presiding officer of , unless- ", "(a) he is, or has been, a Judge of a High Sourt; or x x x x ", "(e) he has been the presiding officer of constituted under any Provincial Act or State Act for not less than five years. ", "The words 'has been a judge of ' denote a past event, on the date of his appointment, he must have been a judge of . Same is the position under clause ", "(e) regarding the office mentioned therein. A similar interpretation will have to be placed on the expressions 'has been' occurring in sub- section 3 of section 7A regarding the qualifications to be possessed by a person for appointment as presiding officer of a . The words 'has been' occurring in these sub-sections, immediately after the word 'is' or even separately clearly shows that they refer to a past event. ", "The words 'has been referred' in section 11A are no doubt capable of being interpreted as making the section applicable to references made even prior to 15-12-1971. But is the section so expressed as to plainly make it applicable to such references ? In our opinion, there is no such indication in the section. In the first place, as we have already pointed out, the section itself has been brought into effect only some time after the Act had been passed. The Proviso to section 11A which is as much part of the section, refers to \"in any proceeding under this section\". Those words are very significant. There cannot be a \"proceeding under this section\", before the section itself has come into force. A proceeding under that,section can only be on or after 15-12-1971. That also gives an indication that section 11A applies only to disputes which are referred for adjudication after the section has come into force. ", "Reliance has been placed by the learned counsel for the workmen on the decision of this Court in (1). Section 57 of the Bombay Police Act dealt with the removal of persons convicted of certain offences. ", "(1) [1961] (2) S.C.R. 26. ", "620 ", "The opening words of the section were \"if a person has been convicted ; then followed the various types of offences of which that person may have been convicted. The Deputy Com- missioner of , Bombay, acting under section 57(1) passed an order externing the respondent from the limits of Greater Bombay. It was contended before that section 57 was prospective and could not be made applicable unless the conviction on which the action of externment was based, took place after the coming into force of that Act. upheld this contention and acquitted the accused. had held that as the legislature had used the present participle 'has been'. and not the past participle in the opening part of the section, it should be understood that the section was intended to be used only where a person was convicted of the offences re- ferred to in section 57 , subsequent to the coming into force of the Act. This Court differed from the interpretation placed by on section 57 of the Bombay Act and held that the section enabled the authorities to take note of the convictions of the accused prior to the Act. It was observed \"An offender who has been punished may be res- trained in his acts and conduct by some legislation, which takes note of his antecedents; but so long as the action taken against him is after the Act comes into force, the statute cannot be said to be applied retrospectively. The Act in question was thus not applied retrospectively but prospectively The verb 'has been' is in the present perfect tense, and may mean either 'shall have been' or 'shalt be'. Looking, however, to the scheme of the enactment as a whole and particularly the other portions of it, it is manifest that the former meaning is intended It is clear from the above observations that the, expression 'has been' was interpreted having regard to the schemes of the enactment and it was not construed in isolation. That decision makes it clear that. the question whether those expressions relate to past or future events, have to be gathered from the context in which they appear as well as the scheme of the particular legislation. The decision of in v. ) is also not of any material,' assistance to the workmen. Having due regard to the scheme of the \"Law Reform (Married Women and Tortfeasors) Act, 1935\", it was held therein that the said statute did away with a host of legal fictions, which in origin were inextricably mixed up with the old procedural law. It was further held that the canon against retrospective interpretation does not (1) I All E.R. 115. ", "621 ", "apply to a statute dealing with the adjective law i.e. procedure. Similarly the decision of in v. Modak(1) which has been approved in . ) and the decision of this Court in (3) do not advance the case of the workmen. The decision in . (supra) relied on by the employers deals with a different problem. It must be stated at this stage that procedural law has always been held to operate even retrospectively, as no party has a vested right in procedure. In our opinion, the principles stated in In re Atlumhney v. Ex-parte Wilson(4) are more apposite to the case on hand. The question arose regarding the construction to be placed upon section 23 of the Bankruptcy Act 1890. The said section was as follows: ", "\"Where a debt has been proved upon a debtor's estate under the principal Act, and such debt includes interest, or any pecuniary consideration in lieu of interest, such interest or consideration shall, for the pur- poses of dividend, be calculated at a rate not exceeding five per centum per annum, without prejudice to the right of a creditor to receive out of the estate any higher rate of interest to which he may be entitled after all the debts proved in the estate have been paid in full\". ", "The point that arose for consideration was whether the above section operates so as to govern the distribution of dividend under a contract made under a scheme which had taken effect before the Act was passed or came into operation. In holding that the section was not retrospective, it was observed : ", "\"Then is the section so expressed as to be plainly retrospective ? No doubt the words 'where a debt has been proved under the principal Act' are capable, of such a meaning. But this form of words is often used to refer, not to a past time which preceded the enact- ment, but to a time which is made past by anticipation a time which will have become a past time only when the event occurs on which the statute is to operate. In former times draftsmen would have used the words ' where a debt shall have been proved' but in modern Acts the past tense is frequently used where no retrospective operation can be intended\". ", "(1) I.L.R. 1948 (II) Cal. 209. (2) [1966] (2) S.C.R. 660. (3) [1962] (2) S.C.R. 159. (4) [1898] 2 Q.B. 547. ", "622 ", "We have already expressed our view regarding the interpreta- tion of - section 11A . We have held that the previous law, according to the decisions of this , in cases where a proper domestic enquiry had been held, was that the , had no jurisdiction to interfere with the finding of misconduct except under certain circumstances. The position further was that the had no jurisdiction to interfere with the punishment imposed by an employer both in cases where the misconduct is established in a proper domestic enquiry as also in cases where the finds such misconduct proved on the basis of evidence adduced before it These limitations on the powers of the s were recognised by this mainly on the basis that the power to take disciplinary action and impose punishment was part of the managerial functions. That means that the law, as laid down by this over a period of years,' had recognised certain managerial rights in an employer. We have pointed out that this position has now been changed by section 11 A. The section has the effect of altering the law by abridging the rights of the employer inasmuch as it gives power to the for the first time to differ both on a finding of misconduct arrived at by' an employer as well as the punishment imposed by him. Hence in order to make the section applicable even to disputes, which had been referred prior to the coming into force of the section, there should be such a clear, express and manifest indication in the section. There is no such express indication. An inference that the section applies to proceedings, which are already pending, can also be gathered by necessary, intendment. In the case on hand, no such inference can be drawn as the indications are to the contrary. We have already referred to the, proviso to section 11A which states 'in any proceeding under this section'. A proceeding under the section can only be after the section has come into force. Further the section itself was brought into force some time after the Amendment Act was passed. These circumstances as well as the scheme of the section and particularly the wording of the Proviso indicate that section 11A does not apply to disputes which had been referred prior to 15-12- 1971. The section applies only to disputes which are referred for adjudication on or after 15-121971. To conclude, in our opinion, section 11A has-no application to disputes referred prior to 15-12-1971. Such disputes have to be dealt with according to the decisions of this already referred to. ", "In Civil Appeal No. 1461 of 1972, had considered only the question regarding- the applicability of the section to disputes which had been referred before the section came into force. The has held that the section does not apply to such disputes. This view is in accordance with our decision and as such is correct. This appeal is hence dismissed. ", "In the three other orders, which are the subject of consideration in Civil Appeals Nos. 1995 of 1972, 1996 of 1972 and 2386 of 1972, , Bombay has held that section 11A applies even to disputes which had been referred prior to 15-121971 This view, according to our judgment, is erroneous. has also-expressed some views on the construction to be placed on section 11 A. Part of the views expressed therein is correct; but the rest are wrong. To the extent that the decision of in the three orders are contrary to our decision on both the points, they are set aside add the appeals allowed to that extent. The and s concerned in all these appeals, will proceed with the adjudication of the disputes in accordance with the views expressed in this judgment. There will be no order as to costs in these appeals. ", " ", "C.A. No. 1461/72 dismissed. ", "C.As. Nos. 1995-96 & 2386/72 allowed in part. ", "624"], "relevant_candidates": ["0000035363", "0000109006", "0000148904", "0000248970", "0000290317", "0000544776", "0000663930", "0000673500", "0000774563", "0000967474", "0001395554", "0001575323", "0001658737", "0001915938", "0001919374"]} {"id": "0001356048", "text": ["JUDGMENT , J. ", "1. This appeal arises out of a suit for specific performance of a contract entered into by the defendant to convey an estate known as the estate to the first plaintiff. ", "2. The contract is evidenced by a compromise decree dated 8th April, 1942, in O.S. No. 67 of 1941 on the file of the -, Nilgiris, whereby the first plaintiff undertook, inter alia to deposit Rs.16,500 by the 30th June, 1943, and the defendant on his part agreed to convey the estate. The first plaintiff entered into an agreement on 17th June, 1943, with the second plaintiff purporting to sell the estate for Rs. 25,000 to the latter. Under this agreement, the first plaintiff got Rs. 17,880 which she deposited in in pursuance of the compromise decree on the 29th June, 1943, and brought the present suit for specific performance of the compromise by the defendant executing a conveyance either to her or to the second plaintiff. ", "3. It would appear that the second plaintiff in his turn purported to execute a sale for Rs. 30,000 of the estate in question to one Kandasami Goundan on 12th May, 1946, who applied in I.A. No. 115 of 1946 in the lower Court to be impleaded as the third plaintiff in the suit. This application having been allowed, the first plaintiff who opposed the application has preferred this civil miscellaneous appeal attacking the order of the lower Court. ", "4. Learned counsel for the appellant argues that Order 22, Rule 20 of the Code of Civil Procedure does not apply to the case and the below had no power to allow to come on record as the third plaintiff as he has not acquired any \" interest\" in the estate which is the subject-matter of the suit. It is argued that the words \"any interest\" in Order 22, Rule 20 of the Code refer-to interest in property and as the third plaintiff has not acquired any interest in the estate under the document of the 12th May, 1946, the provision does not entitle the third plaintiff to come on record to continue the proceedings as he seeks to do. We are unable to accept this contention. Apart from the fact that the first plaintiff herself impleaded the second plaintiff in the suit although the latter had acquired no interest in the estate under the document dated 17th June, 1943, for the simple reason that the first plaintiff herself who executed the document has not yet acquired any such interest, we are of opinion that the word \" interest \" is used in Rule 20 of Order 22 in a much wider sense. Learned counsel concedes that if in a suit for specific performance the original plaintiff died, the person on whom the right devolved would be entitled to continue the suit, for the action is not personal and would not terminate with the death of the original plaintiff. Similarly, if there is an assignment of the right by the original plaintiff during the pendency of a suit for specific performance there is no obvious reason why the person to whom such right has passed should not be able to continue the suit under Rule 20 of Order 22. The words \"any interest\" in this rule include in our opinion, any transferable \" right to sue \" spoken of in the earlier rules of the order which provide for its devolution in cases of death. The contention therefore that the \"assignment, creation or devolution of any interest\" referred to in Rule 20 mean an assignment, creation or devolution of an interest in tangible property cannot be accepted. ", "5. Reference was made to (1913) 25 M.L.J. 301 : L.R. 40 I.A. 86 :I.L.R. 35 All. 273 (P.C.), as supporting the contention of the appellant. That was a case where a person who had entered into a financing agreement with the original plaintiffs in a suit for recovery of possession of immoveable property sought to continue the suit after the original plaintiffs compromised their claim, and the question arose whether such person was competent to continue the suit. Their Lordships held that the agreement in question did not confer a present right to the possession of the property which was the subject-matter of the suit, and that therefore the person who entered into such an agreement with the original plaintiffs was not competent to continue the suit. That decision has no application to the present case which is a suit for specific performance in which the first plaintiff's right to relief is not based on any interest in the property. The other decision cited, viz, (1940) 2 M.L.J. 337, merely follows the decision of referred to above and does not carry the matter any further. ", "6. The appeal fails and is dismissed with costs of the first respondent."], "relevant_candidates": ["0000494897", "0001448071"]} {"id": "0001360078", "text": ["PETITIONER: UNION OF INDIA Vs. RESPONDENT: & ANR. DATE OF JUDGMENT06/11/1978 BENCH: FAZALALI, SYED MURTAZA BENCH: FAZALALI, SYED MURTAZA DESAI, D.A. CITATION: 1979 AIR 366 1979 SCR (2) 229 1979 SCC (3) 4 CITATOR INFO : RF 1986 SC2045 (45) RF 1990 SC1962 (6) ACT: Code of Criminal Procedure, 1973, S. 227-order of discharge by a Special Judge, scope and ambit. HEADNOTE: The second respondent, a Land Acquisition officer, allegedly, by abusing his official position, concealed the fact that the land which was the subject matter of acquisition was really Khasmahal land belonging to the and having made it appear that the first respondent was the undisputed owner of the same, aided and abetted him in getting a huge sum of money as compensation. The charge-sheet was submitted before the Special Judge, and the prosecution requested him to frame a charge against the respondents under ss. 5(2) and 5(1)(d) of the Prevention of Corruption Act read with s. 120B . The Special Judge, went through the charge-sheet, statements made by the witnesses before the police and other documents, and coming to the conclusion that there was no sufficient ground for framing a charge against the respondents, discharged them under s. 227 . ,1973, after giving cogent reasons for passing the order of discharge. In revision upheld the Special Judge's order of discharge. Dismissing the appeal by special leave, the ^ HELD: 1. The considerations governing the interpretation of s. 227 of Cr. P.C. apply mutatis mutandis to the proceedings under the Prevention of Corruption Act , after the charge-sheet is submitted before the Special Judge. At the stage of s. 227 , the Judge has merely to sift the evidence in order to find out whether or not, there is sufficient ground for proceeding against the accused. The sufficiency of ground would take within its fold, the nature of the evidence recorded`by the police, or the documents produced before the court, which exfacie disclose that there are suspicious circumstances against the accused so as to frame a charge against him. [231E, 233A- , I SCR 257; .. AIR 1967 SC 740; , 2 SCR 520; applied. 2. What has been acquired is merely the Raiyyati or the lessee's interest, and as the proprietary interest vests in the itself, there is no question of either acquiring or claiming compensation for the interest of the . [239B] ., AIR 1955 SC 298; and The Special Land Acquisition officer, ., AIR 1972 SC 2224: applied. 230 JUDGMENT: ", "CRIMINAL APPELLATE JURISDICTION: Criminal Appeal No. 194 of 1977. ", "(Appeal from the Judgment and order dated 30-8-76 of in Criminal Revision No. 88/76). ", ", Addl. Sol. Gen. and and for the appellant. ", " and for the respondent. The Judgment of the Court was delivered by J. This appeal is directed against the judgment dated 30th August, 1976 of by which has upheld the order of the Special Judge, discharging respondents No. 1 and 2. ", "The facts of the case lie within a narrow compass and centre round an alleged conspiracy said to have been entered into between respondents No. 1 and 2 in order to commit offences under sections 5(2) and 5(1)(d) of the Prevention of Corruption Act (hereinafter referred to as the Act) read with section 120-B I.P.C. The main charge against the respondents was that between 19-2-1972 to 30-3-1972 the respondent entered into an agreement For the purpose of obtaining pecuniary advantage for respondent No. 1 P. K. Samal and in pursuance of the said conspiracy the second respondent , who was the Land Acquisition officer aided and abetted the first respondent in getting a huge sum of money for a land acquired by the Government which in fact belonged to the Government itself and respondent No. 1 was a skew thereof. It is averred in the chargesheet that respondent No. 1 by abusing his official position concealed the fact that the land which was the subject matter of acquisition and was situated in Cuttack Cantonment was really Khasmahal land belonging to the Government and having made it appear that he was the undisputed owner of the same, got a compensation of Rs. 4,18,642.55. The charge-sheet contains a number of circumstances from which the inference of the conspiracy is sought to be drawn by the police. After the charge-sheet was submitted before the Special Judge, the prosecution ousted him to frame a charge against the respondents. The Special Judge, after having gone through the charge-sheet and statements made by the witnesses before the police as also other documents came to the conclusion that there was no sufficient ground for framing a charge against the respondents and he accordingly discharged them under section 227 of the Code of Criminal Procedure, 1973 hereinafter called the Code ). The Special Judge has given cogent reasons for passing the order of discharge. The appellant went up to in revision against the order of the Special Judge refusing to frame the charge, but dismissed the revision petition filed by the appellant and maintained the order of discharge passed by the Special Judge. Thereafter the appellant moved this Court by ar, application for special leave which having been granted to the appellant, the appeal is now set for hearing before us. ", "The short point which arises for determination in this case is the scope and ambit of an order of discharge to be passed by a Special Judge under section 227 of the Code. The appeal does not raise any new question of law and there have been several authorities of as also of this on the various aspects and grounds on which an accused person can be discharged, but as section 227 of the Code is a new section and at the time when the application for special leave was filed, there was no direct decision of this on the interpretation of section 227 of the Code, the matter was thought fit to be given due consideration by this . ", "We might, state, to begin with, that so far as the present case (offences committed under the Prevention of Corruption Act ) is concerned it is regulated by the procedure laid down by the Criminal Law Amendment Act under which the police has to submit, charge-sheet directly to the Special Judge and the question of commitment to does not arise, but the Sessions Judge has nevertheless to follow the procedure prescribed for trial of sessions cases and the consideration governing the interpretation of section 227 of the Code apply mutatis mutandis to these proceedings after the charge-sheet is submitted before the Special Judge. ", "Before interpreting and analysing the provisions of section 227 of the Code so far as pure sessions trials are concerned, two important facts may be mentioned. In the first place, the Code has introduced substantial and far reaching changes in the Code of 1898 as amended in 1955 in order to cut out delays and simplify the procedure, has dispersed with the procedure for commitment enquiries referred to m section 206 to 213 of the Code, of 1898 and has made commitment more or less a legal formality. Under the previous Code of 1898 the Magistrate was enjoined to take evidence of the prosecution witnesses after giving opportunity to the accused to cross-examine the witnesses 2nd was then required to hear the parties and to commit the acceded to unless he chose to act under section 209 and found that there was no sufficient ground for committing the accused person for trial. Under the Code the Committing Magistrate has been authorised to peruse the evidence and the documents produced by the police and commit the case straightaway to if the case is one which is exclusively triable by . Thus, it would appear that the legislature while dispensing with the procedure for commitment enquiry under the Code of 1898 has conferred a dual responsibility on the Trial Judge who has first to examine the case on the basis of the statement of witnesses recorded by the police and the documents filed with a view to find out whether a prima facie case for trial has been made out and then if such a case is made out to proceed to try the same. In our view the legislature has adopted this course in order to avoid frivolous prosecutions and prevent the accused from being tried of an offence on materials which do not furnish a reasonable probability of conviction. In the instant case, as the offences alleged to have been committed by the respondents fall within the provisions of the Act, the Special Judge has been substituted for the Sessions Judge, the procedure of having been applied fully to the trial of such cases. Thus, it is manifest that the accused has not only one opportunity and that too before the Sessions Judge for showing that no case for trial had been made out. This was obviously done to expedite the disposal of the criminal cases. ", "Secondly, it would appear that under section 209 of the Code of 1898 the question of discharge was to be considered by a Magistrate. This power has now been entrusted to a senior Judge, namely, who is to conduct the trial himself and who has to decide before commencing the trial as to whether or not charges should be framed in a particular case against the respondents The discretion, therefore, is to be exercised by a senior and more experienced Judge so as to exclude any abuse of power. In this view of the matter, it is manifest that if exercises his discretion in discharging the accused for reasons recorded by him, his discretion should not normally be disturbed by or by this . ", " Section 227 of the Code runs thus:- ", "\"If, upon consideration of the record of the case and the documents submitted therewith, and after hearing the submissions of the accused and the prosecution in this behalf, the Judge considers that there is not sufficient ground for proceeding against the accused, he shall discharge the accused and record his reasons for so doing.\" ", "The words 'not sufficient ground for proceeding against the accused' clearly show that the Judge is not a mere post office to frame the charge at the behest of the prosecution, but has to exercise his judicial mind to the facts of the case in order to determine whether a case for trial has been made out by the prosecution. In assessing this fact, it is not A necessary for the court to enter into the pros and cons of the matter or into a weighing and balancing of evidence and probabilities which is really his function after the trial starts. At the stage of section 227 , the Judge has merely to sift the evidence in order to find out whether or not there is sufficient ground for proceeding against the accused. The sufficiency of ground would take within its fold the nature of the evidence recorded by the police or the documents produced before the court which ex facie disclose that there are suspicious circumstances against the accused so as to frame a charge against him.: ", "The scope of section 227 of the Code was considered by a recent decision of this in the case of (1) where , J. speaking for the observed as follows:- ", "\"Strong suspicion against the accused, if the matter remains in the region of suspicion, cannot take the place of proof of his guilt at the conclusion of the trial. But at the initial stage if there is a strong suspicion which leads the to think that there is ground for presuming that the accused has committed an offence then it is not open to the to say that there is no sufficient ground for proceeding against the accused. The presumption of the guilt of the accused which is to be drawn at the initial stage is not in the sense of the law governing the trial of criminal cases in France where the accused is presumed to be guilty unless the contrary is proved. But it is only for the purpose of deciding prima facie whether the should proceed with the trial or not. If the evidence which the Prosecutor pro poses to adduce to prove the guilt of the accused even if fully accepted before it is challenged in cross-examination or rebut ted by the defence evidence; if any, cannot show that the accused committed the offence then there will be no sufficient ground for proceeding with the trial\". ", "This Court has thus held that whereas strong suspicion may not take the place of the proof at the trial stage, yet it may be sufficient for the satisfaction of ths Sessions Judge in order to frame a charge against the accused. Even under the Code of 1898 this Court has held that a committing Magistrate had ample powers to weigh the evidence for the limited purpose of finding out whether or not a case of commitment to the Sessions Judge has been made out. ", "(1) [1978]1 S.C.R. 287. ", "16-817 SCI/78 In the case of .(1) this Court observed as follows:- ", "\"No doubt a Magistrate enquiring into a case under S. 209 , Cr. P.C. is not to act as a mere Post office and has to come to a conclusion whether the case before him is fit for 8 commitment of the accused to \". ", "To the same effect is the later decision of this Court in the case of (2) where , J. speaking for the Court observed as follows:- ", "\"A Magistrate holding an enquiry is not intended to act merely as a recording machine. He is entitled to sift and weigh the materials on record, but only for seeing whether there is sufficient evidence for commitment; and not whether there is sufficient evidence for conviction. If there is no prima facie evidence or the evidence is totally unworthy of credit; it is the duty to discharge the accused: if there is some evidence on which a conviction may reasonably be based, he must commit the case\". ", "In the aforesaid case this was considering the scope and ambit of section 209 of the Code of 1898. ", "Thus, on a consideration of the authorities mentioned above, the following principles emerge: ", "(1) That the Judge while considering the question of framing the charges under section 227 of the Code has the undoubted power to sift and weigh the evidence for the limited purpose of finding out whether or not a prima facie case against the accused has been made out: (2) Where the materials placed before the disclose grave suspicion against the accused which has not been properly explained the will be, fully justified in framing a charge and proceeding with the trial. (3) The test to determine a prima facie case would naturally depend upon the facts of each case and it is difficult to lay down a rule of universal application. By and large however if two views are equally possible and the Judge is satisfied that the evidence produced before him while (1) A.I.R. 1967 S.C. 740. ", "(2) [1969] 2 S.C.R. 520. ", "235 ", "giving rise to some suspicion but not grave suspicion against the accused, he will be fully within his right to discharge the accused. ", "(4) That in exercising his jurisdiction under section 227 of the Code the Judge which under the present Code is a senior and experienced Judge cannot act merely as a office or a mouth-piece of the prosecution, but has to consider the broad probabilities of the case, the total effect of the evidence and the documents produced before the , any basic infirmities appearing in the case and so on. This however does not mean that the Judge should make a roving enquiry into the pros and cons of the matter and weigh the evidence as if he was conducting a trial. ", "We shall now apply the principles enunciated above to the present case in order to find out whether or not the courts below were legally justified in discharging the respondents. ", "Respondent No. 1 was a Joint Secretary in from April, 1966 to January, 1969. Later he worked as Joint Secretary in till 12-11-1971. Thereafter, respondent No. 1 was working as Joint Secretary, . The second respondent worked as Land Acquisition officer in the , Orissa from February 1972 to 18th August, 1973. ", "In the year 1969 authorities were desirous of having a piece of land for construction of quarters for their staff posted at Cuttack. In this connection, the said authorities approached respondent No. 1 who had a land along with structure in the Cantonment at Cuttack. As authorities found this land suitable, they approached respondent No. 1 through his mother for selling the land to them by private negotiation. As this did not materialise, authorities moved the Collector of Cuttack to assess the price of the land and get it acquired. Accordingly, the Tehsildar of the area directed the officer, Cuttack; to fix the valuation of the land of respondent No. 1. The officer reported back that the land belonged to respondent No. 1 and was his private land and its value would be fixed at Rs. 3000 per guntha. It is common ground that the land in question was situated in Cuttack Cantonment and was a Khasmahal land which was first leased out to one Mr. as far back as 1-9-1943 for a period of 30 years. The lease was given for building purposes. In 1954. Mrs. who inherited the property after her husband's death transferred the land to respondent No. 1 with the consent of the Khasmahal authorities. When respondent No. 1 came to know that the land in question was required by authorities, he wrote a letter to Mr. . S. on 28th October, 1970 suggesting that the land- may be acquired but price fixed by mutual consent. It may be pertinent to mention here that in this, letter a copy of which being Ex. D-4 (12) is to be found at page 86 of the paper-book, respondent No. 1 never concealed the fact that the land really belonged to the Government. In this connection, respondent No. 1 wrote thus:- ", "\"I have represented to you against the revenue authorities quoting a higher price for similar Government land more adversely situated and a lower price for my land despite its better strategic location\". ", "We have mentioned this fact because this forms the very pivot of the case of the appellant in order to assail the judgment of the courts below. A perusal of this letter clearly shows that respondent No. 1 made no attempt to conceal that the land in question was, a land which was leased out to his vendor. A copy of the original agreement which also has been filed shows that under the terms of the lease, the same is entitled to be renewed automatically at the option of the lessee and unless the lessee violates the conditions of the lease, there is no possibility of the lease being resumed. As it is, the lease had been continuing from the year 1943 and there was no possibility or its not being renewed on 1-9-1973 when the period expired. In these circumstances, therefore, it cannot be said that the letter written by respondent No. 1 referred to above was an evidence of a criminal intention on the part of respondent No. 1 to grab the huge compensation by practising fraud on the . Respondent No. 1 a high officer of the and was a lessee of the , a fact which he never concealed and if he was able to get a good customer for purchasing his land or acquiring the same, there was no harm In writing to the concerned authority to fix the proper valuation and take the land. There, was no question of any concealment or malpractice committed by respondent No. 1. ", "Apart from this, the contention of the appellant that the fact that the land being Khasmahal land belonging to the was deliberately suppressed by the respondents is completely falsified by the circumstances discussed hereinafter: ", "The land in question was situated in a Cantonment area and it is not disputed that all lands in the Cantonment area were Khasmahal Lands belonging to the Government. ", "237 ", " in this connection has observed as follows: ", "\"Government authorities admit that the land in question was known to be Khasmahal land from the very inception. This must lead to an inference that the authorities knew that the interest of the opposite party No. 1 in the land was that of a lessee and was the proprietor\". ", " has further observed that a number of witnesses who were examined by the police had stated that it was common Knowledge that all khasmahal lands in the Cantonment area in Cuttack were Government lands Relying on the statement of Mr. , Collector, Cuttack, observed as follows:- ", "\" who has admittedly played an important role in the land acquisition proceeding has said that it is a matter of common knowledge that all khasmahal lands in Cantonment area at Cuttack are lands. He has further categorically stated that did not put undue pressure of any kind\". ", "Furthermore, it would appear that Mr. , Land Acquisition officer submitted a report about the land in question on 15th February, 1971 in which he had clearly mentioned that the land in question was land and that respondent No. 1 was a Pattidar in respect of the land as shown in the record. Thus, one of the important premises on the basis of which the charge was sought to be framed has rightly been found by not to exist at all. The records of the showed the nature of the land. Respondent No. 1 at no time represented to the authorities or the that the land was his private one and the records of the clearly went to show that the land was a land. In these circumstances, therefore, it cannot be said that respondent No. 1 acted illegally in agreeing to the land being acquired by the . ", "Another important circumstance relied on by the appellant was the great rapidity with which the land acquisition proceedings started and ended clearly shows that the respondents had joined hands to get the lands acquired and the compensation paid to respondent No. 1. In this connection, reliance was placed on the fact that the copies of the records of rights were prepared on 30th March, 1972 in which the land was no doubt shown as having been owned by the . report was also prepared on the same date. Respondent No. 1 presented his copy of the deed of transfer also on the same date and respondent No. 2 made the award for Rs. 4,18,642.55 also on the same date. The entire amount was disbursed also on the same date and possession also was handed over on the same date. Prima facie, it would appear that the Officer acted in great hurry perhaps at the instance of respondent No. 1. These circumstances are clearly explainable and cannot be said to exclude every reasonable hypothesis bu the guilt of respondent No. 1. Admittedly, the authorities were in a great hurry to get the land acquired and take possession of the same. As respondent No. 1 was a high officer of the cadre there may have been a natural anxiety on the part of the small officers posted in the district of Cuttack to oblige respondent No. 1 by completing the proceedings as early as possible and meeting the needs of the . ", "It would, however, appear that once notices under section 9(1) and 10(1) of the Land Acquisition Act were issued and the objection filed by the appellant was withdrawn, because there was no one else in the field, there was no impediment in the way of acquiring the land and taking possession from respondent No. 1. In fact, it would appear as pointed out by that as far back as 22nd February 1972 the Land Acquisition officer who was a person other than the second respondent had sent a letter to the Government with the counter signature of the Collector for sanctioning the estimate of acquisition of 2 acres of land belonging to respondent No. 1. Later, however, the area of the land was reduced from 2 acres to 1.764 acres and revised estimates as desired by the department were sent on 7-3-1972. This estimate amounted to Rs. 4,18,642 55 and was sent through the 's letter,on 8-3-1972. by their letter dated 11-3-1972 sanctioned the aforesaid estimate. There after, the Government indicated to the Collector that an award might be passed for acquiring 1.764 acres of land. These facts apart from negativing the allegations of criminal conduct against the respondents demonstrably prove the untruth of the circumstance relied upon in the charge-sheet, namely, that unless the respondent No. 1 and 2 acted in concert and conspiracy with each other, respondent No. 1 could not have known the exact figure of the compensation to be awarded to him. In this connection, reliance was placed on a letter written by respondent No. 1 to the officer, on 15th March, 1972 where he had mentioned that as of the he would be getting a compensation of Rs. 4,18,642.55 which is to be paid to him on the 10th March, 1972 and it was argued that unless the two respondents were in league with each other how could respondent No. 1 get these details. We are, however, unable to agree with this contention. ", "239 ", "We have already mentioned that a fresh estimate for 1.764 acres was prepared and the total compensation was Rs. 4,18,642.55 as only the Raiyyati or the lessee's interest was proposed to be acquired and this letter was sent to the for sanction and the estimate was sanctioned on 11-3-1972. It was contended that no notice was given to the department, so that the could claim compensation of the proprietary interest. It is obvious that what has been acquired in the present case is merely the Raiyyati or the lessee's interest and as the proprietary interest vests in the itself, there is no question of either acquiring or claiming compensation for the interest of the . In the case of .(1) this Court observed as follows:- ", "\"If the has itself an interest in the land, it has only to acquire the other interests outstanding therein, so that it might be in a position to pass it on absolutely for public user..................... When possesses an interest in land which is the subject of acquisition under the Act, that interest is itself outside such acquisition, because there can be no question of acquiring what is its own. An investigation into the nature and value of that interest will no doubt be necessary for determining the compensation payable for the interest outstanding in the claimants, but that would not make it the subject of acquisition\". ", "To the same effect is a later decision of this Court in the case of .(1) where this Court observed as follows:- ", "\"Mr. , the learned counsel for the State of Mysore, contends that the Land Acquisition officer had not assessed the compensation payable for the rights of the respondents in the land acquired .. .......We have gone through the Award made by the Land Acquisition officer. The Land Acquisition officer appears to have valued the rights of the respondents in the lands acquired. Whether the valuation made by him is correct or not cannot be gone into these proceedings.\" ", "As the appellant was naturally interested in finalising the deal as quickly as possible, there could be no difficulty in finding out the esti- ", "(1) AIR 1955 S.C. 298. ", "(2) AIR 1972 S.C. 2224. ", "240 ", "mates which had been sanctioned a week before respondent No. 1 wrote the letter to . This fact proves the bona-fide rather than any wrongful conduct on the part of respondent No. 1 which may lead to an adverse inference being drawn against him. ", "Finally, it was argued that what was acquired by the was merely the lessee's interest, but the respondent No. 1 appears to have got compensation as the owner. This is factually incorrect. We have already referred to the circumstances which clearly show that the was fully aware that it was only the lessee's interest which was being acquired and even the fresh estimate for Rs. 4,18,642. 55, which was sent to the was shown as representing the Raiyyati interest. Mr. appearing for the respondents fairly conceded that having regard to the nature, character and situation of the land, it could not be said that the amount of compensation awarded did not represent the market value of the lessee's interest of the land. ", "On the other hand, in the counter-affidavit at page 87 of the paper book, it has been alleged that 16 sale-deeds executed during the year 1970 and sale-deeds executed during the year 1971 pertaining to the village in question were acquired at the rates varying from Rs. 42,165 to 750,000. has also pointed out that the records before the Trial Judge show that the Collector Vijayasekharan had valued the land at the rate of Rs. 1.70 lakhs per acre as far back 1: as 3-2-1970 and if two years later the valuation was raised to Rs. 2 lakhs it cannot be said that the land was in any way over-valued. ", "Lastly, there does not appear to be any legal evidence to show any; meeting of mind between respondents No. 1 and 2 at any time. Although the Collector at the time of the acquisition was a distant relation of respondent No. 1 he had himself slashed down the rate of compensation recommended by the officer from Rs. 2,10,000 to Rs. 2,00,000 and it was never suggested by the prosecution that the Collector was in any way a party to the aforesaid conspiracy. ", "For these reasons, therefore, we find ourselves in complete agreement with the view taken by that there was no sufficient ground for trying the accused in the instant case. Moreover, this Court could be most reluctant to interfere with concurrent findings of the two courts in the absence of any special circumstances. ", "For the reasons given above, the judgement of is affirmed and the appeal is dismissed. ", "M.R. Appeal dismissed."], "relevant_candidates": ["0000943850", "0001214175", "0001329646", "0001471336", "0001990855"]} {"id": "0001363488", "text": ["PETITIONER: STATE OF MYSORE Vs. RESPONDENT: & ANR. ETC. DATE OF JUDGMENT: 24/11/1970 BENCH: , G.K. BENCH: , G.K. SHAH, J.C. HEGDE, K.S. GROVER, A.N. RAY, A.N. CITATION: 1971 AIR 191 1971 SCR (2) 831 1970 SCC (3) 545 CITATOR INFO : RF 1981 SC 53 (23) E&D 1982 SC1107 (28) ACT: Constitution of India, 1950, Art. 311- Compulsory transfer from Government Service to -If operates as removal from service. HEADNOTE: The of Agricultural Sciences Act , 1963, was passed by , to establish a for the development of agricultural and allied sciences in the State. Under s. 7(4) of the Act, the control and management of such research institutions of the department of agriculture as might by order specify, were to be transferred to the as and from the date specified; and, under sub-s. (5), every person employed in such an institution, were, as from the specified date, to become an employee of the on such terms and conditions as might be determined by in consultation with of the . The respondent was holding a civil post under , having been appointed as a chemical assistant in , Mandya, in the department of agriculture of the State. In 1965, the control and management of the Institute was transferred to the , by a notification under the Act. On the question whether there was a removal-of the respondent from a civil post in contravention of Art. 311 , HELD : Whether the prospects of the respondent were or were not prejudicially affected is irrelevant. For better or for worse, the notification resulted in the extinction of his status as a civil servant, and hence, his compulsory transfer to the was void. [834 A, F] v. Union of India, I.L.R. 13 Punj. 781, distinguished. JUDGMENT: ", "CIVIL APPELLATE JURISDICTION: Civil Appeals Nos. 1868 to 1882 of 1969. ", "Appeals from the judgment and order dated July 9, 10, 1968 of in Writ Petitions Nos. 1776, 2108, 2109, 2111, 2112, 2272, 2273, 2275, 2385, 2386, 2390, 2395 and 2396 of 1966 and 728 and 990 of 1967. ", ", Solicitor-General, and , for the appellant (in all the appeals). and , for respondent No. 1 (in C.As. Nos. 1868 to 1871 and 1874 to 1881 of 1969). ", "832 ", "The Judgment of the Court was delivered by- Mitter, J. The State of Mysore has come up in appeal from a common judgment of at Bangalore disposing of a number of writ petitions and holding void the compulsory transfer of the respondents herein to under the provisions of the University of Agricultural Sciences Act , 1963. ", "As the same question arise Civil all these appeals it will be sufficient to state the facts in Appeal No. 1$68 of 1969 in which one is the respondent. The said respondent was appointed on January 7, 1959 as an agricul- tural demonstrator in . His appointment was as a local candidate' which under Rules means a person appointed not in accordance with the rules of recruitment. His services were however regularised when he was selected by for appointment to that post on August 27, 1959. By an order dated April 4, 1964 he was transferred and posted as a Chemical Assistant of , in the department of agriculture. When he was thus employed, a law made by called the of Agricultural Sciences Act ., 1963 (hereinafter referred to as the Act') came into force on April 24, 1964. Before the respondents to these appeals challenged the vires of s. 7(5) of the Act and a notification issued thereunder. The preamble to the Act shows that it was an Act to estab- lish and incorporate a for the development of agriculture, animal husbandry and allied sciences in the State of Mysore. Under S. 3(2) the was to be a body corporate having perpetual succession and a common seal. The powers given under s. 6 of the Act enabled it inter alia to create administrative, ministerial and other posts and to appoint persons to such posts. Under s. 7(1) subject to the conditions therein mentioned several agricultural and veterinary colleges were disaffiliated from the Karnatak or the of Mysore and were to be maintained by the new as constituent colleges. The control and management of these colleges were to stand transferred to the Agricultural and all its properties and assets and liabilities and obligations of in relation thereto were to stand transferred to, vest in, or devolve upon the said . Under sub-s. (4) of s. 7 the control and management of such research and educational institutions of , and of were, as and from such date as might by order specify, to be transferred to the and thereupon all the properties and assets and liabilities and obligations of in relation to such institutions were to stand transferred to, vest in, or devolve upon the . omitting the proviso which is not relevant for our purpose, sub-s. (5) provided \"Every person employed in any of the colleges specified in sub-section (1) or in any of the institutions referred to in sub-section (4) immediate before the appointed day or the date specified in the order under subsection (4), as the case may be, shall, as from the appointed day or the specified date, become an employee of the on such terms and conditions as may be determined by in consultation with the :\" The has been defined in section 2 clause (3) as the of Regents of the . ", "By notification dated September 29, 1965 the control and management of a large number of research and educational institutions were transferred to the University with effect from October 1, 1965. where the respondent was working was one such institution. Not liking the change which his future prospects were likely to undergo as a result of the notification, the respondent presented a writ petition, seeking a declaration that sub-ss. (4) and (5) of s. 7 of the Act Were invalid And for a further declaration that he continued to be a civil servant under . To put in brief the argument on this head was that he had been removed from a civil post under the in contravention of the provisions of Art. 311. A further argument was put up that the respondent had been subjected to hostile discrimination inasmuch as persons who had been appointed in the same manner as himself and later in point of time than himself had been retained in the service of the thereby infringing articles 14 and 16 of the Constitution. ", "It is not necessary to deal with the second point as the appellant, in our opinion, must fail on the first. There can be no dispute-as indeed the learned Solicitor-General was constrained to admit-that the respondent and others who had filed writ petitions in challenging the notification ceased to hold the civil posts which they held under the State of Mysore at the time when the notification was issued if it was to have full force and effect. Whether the prospects of the respondent were 11-L694Sup.CI/71 or were not to be prejudicially affected if he was to become an employee of the is not in point. However the learned Solicitor-General drew our attention to paragraph 17 of the counter affidavit to the writ petition filed in where it was stated that the terms and conditions of transfer as agreed to by the and the provided inter alia for the following (1)Every employee of the, on his transfer to the shall enjoy the same pay scale. (2) He was to be eligible for pensionary benefits in the same manner as he had while he was serving the . (3) His claims for higher pay scales or higher positions under the shall be deemed to be on a preferential basis in comparison with others, provided the qualifications and experience were equal; and (4)Every employees of the on his transfer to the was to be protected to the extent that the terms and conditions of his service under the would not be altered to his detriment. ", "We are not here concerned with the question as to whether for all practical purposes the respondent was not to be a loser as a result of the transfer. Evidently the respondent held the view that as a civil servant of the of Mysore the prospects of promotion to higher posts with better scales of pay were greater in the service of the with its manifold activities in various departments. For better or for worse, the notification resulted in extinction of his status as a civil servant. ", "The learned Solicitor-General sought to rely on a judgment of in (1) a case which was considered by , in aid of his contention that the transfer of the kind effected in this case had been held to be valid by . at Bangalore went into the question rather elaborately and noted that there were many differences between the provisions of the (Kharagpur) Act 1956, the Act impugned in and the Agricultural University Act of 1963. Tin the Punjab case the petitioner had initially been appointed by the Director, Kharagpur as a peon. As a result of the Act of 1956 the Institution declared to be one of national importance, was constituted under the Act providing inter alia that the employees who were working in the Institute be-fore were to hold office or service thereafter upon the (1) I.L.R. 13 Punj. 781. ", " ", "same terms and conditions and with the same rights and Privileges as to pension, leave, gratuity, provident fund and other matters as they would have held the same on the date of commencement of. the Act as if the Act had not been passed. In the case before us the Act provides by sub-s. (5) of S. 7 that the terms and conditions of the Government employees immediately before the appointed day or the date specified in the notification were to be such as might be determined by the State Government in consultation with the Board. The learned Judge of on the facts of that case found it unnecessary to examine the argument whether, the assent given by the President to the Indian Institute of Technology Bill had the effect of terminating the status of the petitioners as Government servants by the President as also the argument raised on their behalf that their lien had been terminated under the Fundamental Rules without their consent. The Punjab decision can-not therefore apply to the case as presented before us. ", "In the result the appeals fail and are dismissed with costs.. There will be one set of hearing fee. ", "V.P.S. Appeals dismissed."], "relevant_candidates": ["0001085808"]} {"id": "0001364683", "text": [", J. ", "1. In this case one owed a sum, it is said, to . died, leaving a widow and no son. , therefore, was 's heir, he not having, so far as appears, any brother. The creditor , desiring to enforce payment of the debt due by the deceased, ought obviously to have sued , but instead of that he brought a suit against 's mother , and in execution of ex-parte decree against her as representative of sold, or affected to sell, the house in which she dwelt, which was, in fact part of the estate then vested in . An attempt was made to get the sale set aside by another , who resided with , but this failed. It does not appear that acted as agent for , and we agree with the District Judge that she could not be indentified with in his opposition to the attachment so as to be entitled to have limitation computed for her suit from the time of the decision against , An unauthorized act cannot afterwards be ratified so as to prejudice a third person who could not be legally affected in the first in- stance owing to the want of authority (Indian Contract Act , IX of 1872, Section 200 ). \" ", "2. It has, however, been many times ruled that the person who after a summary decision against him in a complaint arising on his obstruction is limited to one year, as the time within which he must bring a suit to establish his right, yet has twelve years if \"Without any obstruction to the attachment or sale he first claims in a suit as having been wrongfully dispossessed of the property sold in execution. This is the position now taken by the plaintiff . He was adopted by between the decree and the sale of the house in question. His right dates back to the death of her husband, and there was not any intermediate obstruction to the attachment or sale on 's part by which could be bound. Had acted for her in trying to get the sale set aside, the present suit would have been in time under the Law of Limitation, but she merely remained quiescent. It is urged, however, that this quiescence was in itself enough to bind and binding her bound her adopted son also, so that now the latter is estopped from disputing the regularity of the proceedings leading to the sale and the validity of the title acquired by the defendant as purchaser at the sale in execution. The case of H.C. Rep. A.C.J. 37 is referred to in support of this contention; and if had wilfully put forward as the representative of so as to deceive and mislead , then, no doubt, she might be held bound by the decree obtained by the latter against . But the District Judge finds that was not ignorant of 's position; there is nothing to indicate that she took any step to deceive him; and her mere quiescence, while he wilfully sued the wrong person, could not deprive her of her legal rights-see v. Second Appeal No. 621 of 1883, decided 17th June 1834. Much less could it deprive her adopted son of his rights & Buhler 1176 (3rd ed.), He could not be bound by a suit and sale, to which he was not a party, either in person or by representative-Fatu v. Printed Judgments for 1884, p. 182. The case of . 4 Calc. 342 rest on a supposed deceitful withholding of a will and a suit against the wrong person induced by the deceit. The case of v. Venktapa I.L.R. 5 Bom. 19 shows that a suit, however just in itself, brought against the wrong party, \"cannot be sustained against the right one, though it shows also that a mortgage erroneously sued on against A is not so extinguished by the decree and consequent execution that it will not avail against B, the person really liable, but not represented in the previous suit. In the present case there was not a mortgage giving to an interest in 's property; there was but a debt due to him; and when the suit against is pronounced ineffectual as against , there is nothing left to fall back upon except the personal obligation so far as this may have descended to and may still be an available cause of action to the creditor. ", "3. , however, it is urged, was bound to come forward when, the property was attached and sold: on 's decree. But the present Code of Civil Procedure, in giving to persons an opportunity to come forward and set up claims to property proposed to be sold in execution, does not say, nor do the rules made under Section 287 of the Code say, that by not coming forward a true owner of the property submits to an extinction of his legal rights. It still behaves an intending purchaser as when the case of v. 8 Bom. H.C. Rep. A.C.J. p. 37 was decided, to see that the person sued as a representative was really the representative of the debtor deceased, since by sale of the derived interest which is no interest) of A, the real interest of B, the true representative, cannot in general be affected. In the case we have just referred to, (Equity Jurisprudence) is quoted (page 43) Sec Sugd. V. & P., Ch. XXIII. Section 2 Wh. & T.L.C. 25, 27 (3rd ed.) to the effect that one who knowing his own title stands by and encourages a purchase of property as another's, will not be allowed to dispute the validity of the sale; but this implies a wilful mis-leading of the purchaser by some breach of duty on the owner's part. The principle broadly stated by must, in practice, be taken with the qualifications stated in v. Watts L.R. 25 Ch. D.571 and in Wilmot v. Barber L.R. 15 Ch. D. 96, 105. From these it appears that \"a man is not to be deprived of his legal rights, unless he has acted in such a way as would make it fraudulent for him to set up these rights.\" There must be ignorance on the one side deluded by a misrepresentation in act or word on the other-Rajcoomar V. McQueen L.R. 15 Ch. D. 96, 105. Now in the present case there does not appear to have been anything more than quiescence on the part of , unless 's application can be attributed to her. If it could be so attributed, then the alleged quiescence and its consequences would fail; but, excluding this, there was no deceit practised; no one was asked to buy by ; she did not represent that she had no interest in the property. She merely left to sell 's so called representative interest for what it might be worth, and did not volunteer any advice or assistance to intending purchasers, who could themselves have ascertained the truth by reasonable inquiry v. 3 H.L. 739; v. , 8 H.L. 481. Supposing was aware of what was going on, she was not, as we have seen, bound to take any step Second Appeal 621 of 1882, decided on 17th June 1884; she might lawfully leave the persons concerned to their own counsels and devices. The illustration to Section 115 of the Indian Evidence Act sets forth that one is bound who intentionally and falsely leads a purchaser to suppose he is taking a perfect title. There is an obligation to truth in speech and act, but no obligation to speak or act where no confidence is given or accepted, merely for the purpose of guarding or furthering the interests of strangers proceeding wholly in invitum, and with an omission to inquire, which is equivalent to knowledge See per Lord in v. & Ir Ap. At P.157. ", "4. The sale must therefore, be pronounced void as against , and the decrees of the Courts below being reversed, the house is awarded to him as sought in his plaint, with costs throughout."], "relevant_candidates": ["0001961792"]} {"id": "0001377254", "text": ["PETITIONER: STATE OF MADRAS Vs. RESPONDENT: MUDALIAR DATE OF JUDGMENT: 18/04/1968 BENCH: , J.C. BENCH: , J.C. BACHAWAT, R.S. MITTER, G.K. VAIDYIALINGAM, C.A. HEGDE, K.S. CITATION: 1969 AIR 147 1968 SCR (3) 829 CITATOR INFO : R 1970 SC 508 (15) F 1970 SC1742 (14) RF 1970 SC1912 (7) R 1974 SC1505 (12) RF 1974 SC1660 (4) RF 1975 SC 583 (27) R 1976 SC 182 (17) RF 1976 SC1016 (18) E 1984 SC1194 (18) R 1986 SC 63 (36) F 1987 SC1922 (7,10,13) RF 1988 SC 567 (11) R 1989 SC1119 (13) RF 1990 SC 781 (74) F 1990 SC 820 (15,17,21,22) ACT: Central Sales Tax Act , 1956--Different rates of tax in different s under s. 8 sub-cls. (2), (2A) and (5)--These provisions whether void for contravention Arts. 301 and 303 of the Constitution--Computation of turnover under s. 9(3) of Act--Must be in the same manner as under law of sales tax--Excise Duty must be excluded if law so provides. Constitution of India, Arts. 301, 302, 303 and 304--Differential rates of Central Sales Tax in different s under s. 8 , sub-cls. (2), (2A) and (5) of Central Sales Tax Act , 1956--Freedom of trade and commerce whether hampered--Discrimination between one and another whether results. HEADNOTE: The respondent claimed before the Commercial Tax Officer, Madras that some of his goods had been sent from Madras to his depot in Andhra Pradesh and that the sales of those goods were intra- sales in Andhra Pradesh where they had been taxed as such. The Commercial Tax Officer however held that the goods had been moved from the of Madras under contracts of sale and were therefore taxable as inter- sales under the Central Sales Tax Act , 1956. The respondent filed a petition under Art. 226 of the Constitution. did not determine the nature of the transactions, but held that sub-ss. (2), (2A) and (5) of s. 8 of the Central Sales Tax Act as they stood at the relevant time imposed or authorised the imposition of varying rates of tax in different s on similar inter- transactions and the 'resultant inequality in the burden of tax affected and impeded trade, commerce and intercourse and thereby offended Arts. 301 and 303(1) of the Constitution. The application of s. 9(3) of the Act was also considered. Against judgment the appealed. - HELD : (i) Restrictions or impediments which directly and immediately impede or hamper the free flow of trade, commerce and intercourse whether or intra- fall within the prohibition imposed by Art. 301 and subject to other provisions may be regarded as void. A tax may in certain cases directly and immediately restrict or hamper the flow of trade but every imposition of tax does not do so. [840 . 1 S.C.R. 809, ., 1 S.C.R. 491 and Firm A.T.B. Mehtab Majid and Co. v. of Madras & Anr. Supp. 2 S.C.R. 435, relied on. (ii) Tax, under the Central Sales Tax Act on sales is in its essence a tax which encumbers movement of trade and commerce, since by the definition in s. 3 of the Act a sale or purchase of the goods is deemed to take place in the course of trade, if it-(a) occasions the: movement of goods 'from one to another; (b) is effected by a transfer of documents of title to the goods during the movement from one to another. But the tax in the present case was saved by the operation of Art. 302 of the Constitution whereby is, notwithstanding the protection conferred by Art. 301 authorised to impose 830 restrictions on the freedom of-trade, commerce or intercourse between one and another or within any part of the territory of India as may be required in the public interest. [841 C-E] The expression 'between one and another' does not imply that the power under Art. 302 can be exercised only in respect of trade between one and another as two entities. The Article expressly provides that restrictions may be imposed not only as between one and another but also within any part of the territory of India. There is also no doubt that exercise of the power to tax may normally be presumed to be in the public interest. [841 F-H] (iii) The Central Sales Tax Act does not discriminate between one and another within the meaning of Art. 303. An Act which is merely enacted for the purpose of imposing tax which is to be collected and to be retained by the does not amount to law, giving or authorising the giving of any preference to one over another, or making, or authorising the making of any discrimination between one and another merely because of varying rates of tax between different s. By leaving it to the s to levy sales tax in respect of a commodity on intra- transactions no discrimination is practised and by authorising the from which the movement of goods commences to levy on transactions of sale Central Sales Tax, at rates prevailing in the, , subject to certain limitations, no discrimination can be deemed to be practised. [843 C-D; 846 C] The flow of trade does not necessarily depend upon the rates of sales tax; it depends upon a variety of factors such as the source of supply, place of consumption, existence of trade channels, the rates of freight, trading 'facilities, availability of efficient transport and other facilities for carrying on trade. [843 G-H] The King v. , 6 C.L.R. 41 and v. (N.S.W.) & Ors., 63 C.L.R. 338. referred to. The rate which a imposes in respect of transactions in a particular commodity must depend on a variety of factors-political and economic. If the rate is so high as to drive away prospective traders from purchasing a commodity and to resort to other sources of supply, in its own interest the will adjust the rate to attract purchasers. Again in a democratic constitution political forces would operate against the levy of an unduly high rate of tax. Attention must also be directed to sub-s. (5) of s. 8 which authorises the Government, notwithstanding anything contained in s. 8 in the public interest to waive tax or impose tax on sales at a lower rate on trade or commerce. It is clear that the has contemplated that elasticity of rates consistent with economic forces may be maintained. [845 B-E] (iv) Article 304 (a) had no application to the present case because there was no imposition of rates of tax on imported goods different from rates of tax on goods manufactured or produced in the . [847 F] Firm A.T.B. Mehtab Majid and Company v. of Madras and Another, Supp. 2 S.C.R. 435 and , 16 S.T.C. 231, distinguished. (v) In the matter of determining the taxable turnover the same rules namely the rules under the law will apply by virtue of s. 9(1) of the Central Sales Tax Act, whether the tax is to be levied under the Central Sales Tax Act or the Madras General Sales Tax Act. Therefore in calculating the turnover of transactions excise duty would 831 be excluded as provided in the Rules made under the Madras Act, although there was no such provision in the Central Act . [848 , 16 S.T.C. 231, referred to. Per (partly dissenting),-(i) It cannot be said that tax under the Central Sales Tax Act on sales as defined in s. 3 of the Act is in its essence a tax hampering movement of trade or commerce within the meaning of Art. 301. That Article makes no distinction between. movement from one part of the :to another part of the same and movement from one to another. If a tax on intra- sales does not offend Art. 301 , logically a tax on sales also cannot do so. Neither tax operates directly or immediately on the free, flow of trade or the free movement or the transport of goods from one part of the country to the other. The tax is on the sale. The movement is incidental and a consequence of the sale. (851 F-H; 85Z A] Even assuming that the Central Sales Tax is within the mischief of Art. 301 , it is certainly a law made by in the public interest and is saved by Art. 302. There is nothing in its provisions which offends Art. 303 [851 F] Per- Hegde, J.-(i) A taxing statute is not outside the scope of Art. 301 of the Constitution. But before a taxing statute is held to be violative of that article it must be shown that it has a direct or immediate, impact on the freedom of trade, commerce and intercourse within the country. A mere remote or incidental impact is insufficient to hold that Art. 301 has been contravened. [85Z B] (ii) The power conferred on by Art. 302 is extremely wide and the only limitation placed on that power is that the law in question must be required in the public interest. Primarily it is for to determine the requirement as to public interest, and its decision is not easy to challenge. In addition there is the presumption of the constitutionality of a statute. [852 D] (iii) Mere difference in rates is neither showing preference nor making discrimination within the meaning of Art. 303(1). But other things being equal the difference in rates would re-suit in showing preference to. some s and making discrimination against others. Hence difference, in rates is a prima facie proof of the preference or discrimination complained of. Once the difference in rates is shown it is for the to, show that the same has not resulted in showing preference to one or more s or making discrimination against one or more s over others in the matter of trade. No interpretation should be placed on Art. 303(1 ), which would render that provision purposeless. The , must place before the its reasons for making the enactment and' satisfy it that Art. 303(1) has not been contravened. [852 F-853 C] On an examination of the material placed before the in the present case it was clear that the differences in the rates we're in public interest and those differences did not materially affect the tree flow of trade in the country. [853 C] [The impugned sections of the Act having been held to be valid, the case was remanded to the High for determining the nature of the transactions] JUDGMENT: ", "CIVIL APPELLATE JURISDICTION : Civil Appeal No. 763 of 1967. ", "832 ", "Appeal from the judgment and order dated April 7, 1967 of in Writ Petition No. 836 of 1966. and , for the appellant. , and , for the respondents. ", ", for intervener No. 1. ", ", for intervener No. 2. and , for intervener No. 3. , and , for intervener No. 4. ", ", for , for intervener No. 5. ", " and , for intervener No. 6. , Advocate-General for the State of Bihar, , , and , for intervener No. 7. ", ", for intervener No. 8. ", ", for intervener No. 9. ", ", for intervener No. 10. ", "The Judgment of , and . was delivered by , partly dissented. ,delivered a separate opinion. ", ", J--In a proceeding for assessment of tax for 1963-64 under the Central Sales Tax Act , 1956, the Deputy Commercial Tax Officer rejected the contention of the assessee that a part of the turnover of his business in matches arose out of intra-State sale transactions at the assessee's depot at Ongole (in the State of Andhra Pradesh) to which depot the goods were despatched by him from his place of business in the State of Madras. The .Deputy Commercial Tax Officer held that the goods were moved from \"the godown stock' of the assessee in execution of contracts of sale with merchants outside the State of Madras, and on that account the turnover from sales was liable to tax under the Central Sales Tax Act . The assessee moved under Art. 226 of the Constitution seeking a writ of certiorari ,quashing the order of assessment, on the grounds, that the provisions of the Central Sales Tax Act which permitted levy of tax at varying rates in different States were invalid, and that the transactions brought to tax were not in truth inter-State transactions. did not determine the nature of the transactions 'but held that sub-s. (2), (2A) and (5) of s..8 of the Central Sales Tax Act , 1956, in operation at the relevant time imposed or authorised the imposition of varying rates of tax in different States on similar inter-State transactions and the resultant inequality in the burden of tax affected and impeded inter-State trade. commerce and intercourse, and thereby offended Arts. 301 and 303(1) of the Constitution. rejected the plea of the assessee that S. 9(3) of the Act was ultra vires. The State has appealed to this Court with certificate granted by against the order declaring sub-ss. (2), (2A) and (5) of S. 8 of the Central Sales Tax Act , 1956, invalid. A brief review of the developments in the law relating to imposition of tax on 'transactions of sale and its inter- relation with the constitutional provisions leading to the enactment of the Central Sales Tax Act , 1956, will facilitate appreciation of the competing views put forward before us at the . The Government of India Act, 1935, by List II entry 48 of the Seventh Schedule conferred power exclusively upon the Provinces to legislate on the subject of \"tax on the sale of goods and on advertisement\". In exercise of that power the Provincial Legislatures enacted sales tax laws for their respective Provinces acting on the principle of \"territorial nexus\", and picked out one or more ingredients constituting a sale and made it or them the basis of imposing liability for tax. This exercise of taxing power by the Provinces led to multiple taxation of the same transaction by many provinces, the burden of tax falling ultimately on the consuming public. In order to remove this burden imposed upon the consumers, Art. 286 was incorporated in the Constitution inter alia for the regulation of inter-State sales transactions. This Court in .(1) held that under the Bombay Sales Tax Act 24 of 1952 sales effected in Bombay in respect of goods exported from the State were not taxable by the State of Bombay, but the importing State was competent to levy tax on transactions of sale in the course of inter-State trade or commerce on persons who were resident outside its territory, provided that the goods were delivered in the importing State for the purpose of consumption therein. This decision made the dealer carrying on business in the exporting State amenable to the sales tax law of the importing State. The question was reconsidered by this Court in (1). The Court held that the sales or purchases made by an assessee which actually took place in the course of inter-State trade or commerce could not be taxed by any State until by law it was otherwise provided by . The judgment in 's case(2) removed, by making inter-State (1) S. C. R. 1069. (2) 2 S. C. R. 603. ", "834 ", "sales immune from taxation, the difficulties till then experienced by the trading community but the importing States which had imposed tax on sales by non- resident dealers, relying on them principle of the judgment in case(1) were faced with innumerable claims for restitution of the tax realized. The President then promulgated Ordinance No. III of 1956 which was later replaced by the \" Sales Tax Laws Validation Act VII of 1956\" with the object of restoring for the period specified in the Act the decision in case(1). The problem of tax on sales was, in the meanwhile, examined by . The report of the Commission led to the enactment of the Constitution Amendment) Act , 1956. By that amendment entry 92A was added in in the Seventh Schedule to the Constitution conferring power upon the to legislate in respect of \"taxes on the sale or purchase of goods other than newspapers, where such sale or purchase takes place in the course of trade or commerce\"; and for entry 54 in the State List, the following entry was substituted : \"Taxes on the sale or purchase of goods other than newspapers, subject to the provisions of entry 92A of List I.\" ", "Explanation to cl. (1) of Art. 286 was omitted, and cls. (2) & (3) were substituted by fresh clauses: by the newly enacted cl. (2) the was authorised by law to formulate principles for determining when a sale or purchase of goods takes place in any of the ways mentioned in cl. (1), and by cl. (3) it was enacted that any law of a State shall, in so far as it imposes or authorises the imposition of, a tax on the sale or purchase of goods declared by by law to be of special importance in inter-State trade or commerce, be subject to such restrictions and conditions in regard to the system of levy, rates and other incidents of the tax as may by law specify. In Art. 269(1) clause (g) was added authorising to collect tax on the sale or purchase of goods other than newspapers, where such sale or purchase takes place in the course of inter-State trade or commerce and making it obligatory upon - to assign the tax to the States in the manner provided in cl. (2). By cl. (3) it was enacted that \" may by law formulate principles for determining when a sale or purchase of goods takes place in the course of inter-State trade or commerce.\" ", "In exercise of authority conferred by the Constitution (Sixth Amendment) Act, 1956, the enacted on (1) [1953] S.C.R. 1069. ", " ", "December 21, 1956, the Central Sales Tax Act , 1956, with a view to formulate principles (a) for determining when a sale or purchase of goods takes place in the course of inter- trade or commerce or outside a or in the course of import into or export from India; (b) providing for the levy, collection and distribution of taxes on sales of goods in the course of inter- trade or commerce; (c) declaring certain goods to 'be of special importance in inter- trade or commerce and specifying the restrictions and conditions to which laws imposing taxes on the sale or purchase of such goods of special importance shall be subject. By s. 3 of the Act a definition of sale or purchase of goods said to take place in the course of inter- trade or commerce was devised. By s. 4 conditions in which a sale or purchase of goods was to be deemed to have taken place outside a were specified. By.s. 5 the conditions in which a sale or purchase of goods taking place in the course of import or export were specified. By Ch. III (ss. 6 to 13) provisions were enacted for declaring a charge of tax on inter- sales and for setting up machinery for levy of tax and incidental matters. Section 6 imposed a charge on all sales effected by a dealer in the course of inter- trade or commerce during any year. By s. 7 provision was made for registration of dealers. Section 8 , insofar as it is material, and as amended by Act 31 of 1958, read as follows \"(1) Every dealer, who in the course of inter- trade or commerce- ", "(a) sells to the Government any goods; or ", "(b) sells to a registered dealer other than the Government goods of the description referred to in sub-section (3) : ", "shall be liable to pay tax under this Act, which shall be two per cent. of his turnover. (2) The tax payable by any dealer on his turnover in so far as the turnover or any part thereof relates to the sale of goods in the course of inter-State trade or commerce not falling within sub-section (1)- ", "(a) in the case of declared goods, shall be calculated at the rate applicable to the sale or purchase of such goods inside the appropriate State; and ", "(b) in the case of goods other than declared goods, shall be calculated at the rate of seven per cent., or at the rate applicable to the sale or purchase of such goods inside the appropriate State, whichever is higher; and for the purpose of-making any such calculation any such dealer shall be deemed to be a dealer liable to pay tax under the sales tax law of the appropriate State, notwithstanding that he, in fact, may not be so liable under that law. ", "(2A) Notwithstanding anything contained in subsection (1) or sub-section (2), if under the sales tax law of the appropriate State the sale or purchase, as the case may be, of any goods by a dealer is exempt from tax generally or is subject to tax generally at a rate which is lower than two per cent. (whether called a tax or fee or by any other name), the tax payable. under this Act on his turnover in so far as the turnover or any part thereof relates to the sale of such goods shall be nil, or, as the case may be, shall be calculated at the lower rate. ", "Explanation.--For the purpose of this sub- section a sale or purchase of goods shall not be deemed to be exempt from tax generally under the sales tax law of the appropriate State if under that law it is exempt only in specified circumstances or under specified conditions or in relation to which the tax is levied at specified stages or otherwise than with reference to the turnover of the goods. ", "(3) ", "(4) ", "(5) Notwithstanding anything contained in this section, may, if it is satisfied that it is necessary so to do in the public interest, by notification in the Official Gazette, direct that in respect of such goods or classes of goods as may be mentioned in the notification and subject to such conditions as it may think fit to impose, no tax under this Act shall be payable by any dealer having his place of business in the in respect of the sale by him from any such place of business of any such goods in the course of inter- trade or commerce or that the tax on such sales shall be calculated at such lower rates than those specified in sub-section (1) or sub-section (2) as may be mentioned in the notification.\" ", "By S. 9 machinery was set up for levy and collection of tax and penalties. Insofar as it is material, it provided : ", "\"(1) The tax payable by any dealer under this Act on sales of goods effected by him in the course of interState trade or commerce whether such sales fall within clause (a) or clause ", "(b) of section 3 shall be levied and collected by in the manner provided in sub-section (3) in the State from which the movement of the goods commenced: ", "Provided (3) The authorities for the time being empowered to assess, collect and enforce payment of any tax under the general sales tax law of the appropriate State shall, on behalf of and subject to any rules made under this Act, assess, collect and enforce payment of any tax, including any penalty, payable by a dealer under this Act in the same manner as the tax on the sale or purchase of goods under the general sales tax law of the State is assessed, paid and collected; and for this purpose they may exercise all or any of the, powers they have under the general sales tax law of the State, and the provisions of such law, including provisions relating to returns, appeals, reviews, revisions, references, penalties and compounding of offences, shall apply accordingly Provided (4) The proceeds in any financial year of any tax, including any penalty, levied and collected under this Act in any State (other than a territory) on behalf of shall be assigned to that State and shall be retained by it; and the proceeds attributable to territories shall form part of .\" ", "By Ch. IV (ss. 14 & 15) provision was made for levy of tax at specially low rates on goods of special importance in inter-State trade or commerce. By S. 14 certain goods were declared to be of special importance in inter-State trade or commerce, and by, s. 15 , as amended by Act 31 of 1958, it was provided: \"Every sales tax law of a State shall, in so far as it imposes or authorises the imposition of a tax on the sale or purchase of declared goods, be subject to the following restrictions and conditions, namely :- ", "(a) the tax payable under that law in respect of any sale or purchase of such goods inside the State shall not' exceed two per cent. of the sale or purchase price thereof, and such tax shall not be levied at more than one stage; ", "838 ", "(b) where a tax has been levied under that law in respect of the sale or purchase inside the State of any declared goods and such goods are sold %in the course of inter-State trade or commerce, the tax so levied shall not exceed two per cent of the sale or purchase subject to such conditions as may be provided in any law in force in that State.\" ", "The scheme of the Act was first to devise definitions of 'interState sales' and 'sales outside the State', and then to declare interState sales subject to tax, and to set up machinery for levying and collecting tax on those sales. Transactions in goods which were made subject to tax in the course of inter-State trade or commerce were classified into three broad categories-(1) transactions falling within s. 8 (1) i.e. all sales to Government, and sales to a registered dealer other than the Government of goods referred to in sub-s. (3) of s. 8 ; (2) transactions falling within S. 8 (2) ", "(a) i.e., sales in respect of declared goods; and (3) transactions falling within S. 8 (2) (b) i.e. sales [not falling within ( 1 ) in respect of goods other than declared goods. Sales of goods in category ( 1 ) were declared liable, at the relevant time to pay a tax of two per cent. on the turnover. On sales of declared goods tax Was to be calculated at the rate applicable to the sale or purchase of such goods inside the appropriate . But by S. 15 the tax payable under a law in respect of any sale or purchase of declared goods inside the was not to exceed two per cent. of the sale or purchase price thereof, and was not leviable at more than one stage. On turnover from sale of goods not failing within categories (1) & (2) the rate was seven per cent. or the rate applicable to the sale or purchase of such goods inside the appropriate , whichever was higher. But by sub-s. (2A) of s. 2 it was provided that notwithstanding anything contained in sub-s. (1) or sub-s. (2), if under the sales tax law of the appropriate the sale or purchase, as the case may be, of any goods by a dealer is exempt from tax generally or is subject to tax generally at a rate which is lower than two per cent. the tax payable under the Act on the turnover insofar as the turnover or any part thereof relates to the sale of such goods shall be nil, or as the case may be shall be calculated at the lower rate. There is a slight inconsistency between s. 8 (2) and S. 8 (2A). If the rate of tax under the law is less than two per cent. by virtue of S. 8 (2A), even in respect of turnover falling within S. 8 (2) (b), the rate of tax will not exceed the rate : if the rate exceeds two per cent, tax at the rate of seven per cent. or of the , whichever is higher, shall prevail. But that has no bearing on the question under discussion. ", "Tax under the Act is payable by the seller. The from which the movement of goods commences in the course of inter- ", "839 ", "State sale collects the tax as agent of , and in the manner provided in sub-s. (3) of s. ", "9. By sub-s. (4) of s. 9 the proceeds in any financial year of any tax, including any penalty, levied and collected under the Act in any State (other than a territory) on behalf of are to be assigned to that State and are to be retained by it, and the proceeds attributable to territories are to form part of . ", "The Act and the constitutional provisions were intended to restrict the imposition of multiple taxation on a single inter- .transaction by different s, each relying upon some territorial nexus between the and the sale. The tax though collected by the under the Central Sales Tax Act was as an agent of , it was, by sub-s. (4) of s. 9 enacted in implementation of the principle of assignment of tax set out in cl. (2) of Art. 269 , assigned to the which collected it. ", "This somewhat tortuous scheme of levying tax on inter-State transactions and making it available to the State which levied it, in effect countenances levy of different rates of tax on inter-State transactions in similar goods. It is upon the prevalence of different rates of tax which, subject to adjustments, and incorporated in the Central Sales Tax Act , that the argument of the assessee is largely founded. He contends-and his contention has found favour with -that the liability to pay tax on interState transactions, depending upon the rate of tax prevailing in the exporting State, hampers trade and commerce, by giving or authorising the giving of preference to one State over another or by making or authorising the making of discrimination between one State and another, and thereby violates the guarantee of freedom of trade, commerce and intercourse declared by Part XIII of the Constitution. The assessee primarily relies upon Arts. 301 and 303(1) of the Constitution in support of his contention. Article 301 provides : ", "\"Subject to the other provisions of this Part, trade, commerce and intercourse throughout the territory of India shall be free.\" ", "This Article is couched in terms of the widest amplitude, trade, commerce and intercourse are thereby declared free and unhampered throughout the territory of India. The freedom of trade so declared is against the imposition of barriers or obstructions within the State as well as inter- State : all restrictions which directly and immediately affect the movement of trade are declared by Art. 301 to be ineffective. The extent to which Art. 301 operates to make trade and commerce free has been considered by this Court in several cases. In v. The State Sup. C. I./68-14 of Assam and others(1), , J., speaking for himself and & , ., observed at p. 860: ", "\"....... we think it would be reasonable and proper to hold that restrictions, freedom from which is guaranteed by Art. 301 , would be such restrictions as directly and immediately restrict or impede the free flow or movement of trade.\" ", "In v. ", "The State of Rajasthan and others(1), the view expressed by , J., in case(1) was accepted by the majority. ", ", J., who agreed with the majority observed that the freedom .declared under Art. 301 of the Constitution of India referred to the right of free movement of trade without any obstructions by way of barriers, inter- State or intra-State, or other impediments operating as such barriers. The same view was expressed in Firm A. T. B. Mehtab Majid and Company v. (\") by a unanimous Court. It must be taken as settled law that the restrictions or impediments which directly and immediately impede or hamper the free flow of trade, commerce and intercourse fall within the prohibition imposed by Art. 301 and subject to the other provisions of the Constitution they may be regarded as void. But it is said that by imposing tax on sales, no restriction hampering trade is imposed. In case (1), , J., observed : \"Taxes may and do amount to restrictions; but it is only such taxes as directly and immediately restrict trade that would fall within the purview of Art. 301. The argument that all taxes should be governed by Art. 301 whether or not their impact on trade is immediate or mediate, direct or remote, adopts, in our opinion, an extreme approach which cannot be upheld.\" ", "In a recent judgment of this in (4), , J., speaking for the , after referring to the observations made by , J., in case(1) observed \"This interpretation of Article 301 was not dissented from in -- I S.C.R. 491. Normally, a tax on sale of goods does not directly impede the free (1) 1 S.C.R.809. ", "(2) [1963] Supp. 2 S.C.R. 435. ", "(3) [1963] 1 S. C. R. 491. ", "(4) 21 S. T. C. 212. ", "841 ", "movement or transport of goods. Section 21 is no exception. It does not impede the free movement or transport of goods and is not violative of Article 301.\" ", "Section 21 of the Andhra Pradesh Sugar Cane (Regulation of Supply and Purchase) Act which was referred to in the judgment authorised to levy a tax at such rate not exceeding five rupees per metric tonne as may be prescribed on the purchase of cane required for use, consumption or sale in a factory. It must, therefore, be regarded as settled law that a tax may in certain cases directly and immediately restrict or hamper the flow of trade, but every imposition of tax does not do so. Tax under the Central Sales Tax Act on inter-State sales, it must be noticed, is in its essence a tax which encumbers movement of trade or commerce, since by the definition in s. 3 of the Act a sale or purchase of goods is deemed to take place in the course of inter-State trade or commerce, if it- ", "(a) occasions the movement of goods from one State to another; (b) is effected by a transfer of documents of title to the goods during their movement from one State to another. The question which then falls to be determined is whether the tax imposed in the present case is saved by the operation of the other provisions of Part XIII. Article 302 of the Constitution provides that may by law impose such restrictions on the freedom of trade, commerce or intercourse between one State and another or within any part of the territory of India as may be required in the public interest. Thereby the is, notwithstanding the protection conferred by Art. 301 , authorised to impose restrictions on the freedom of trade, commerce or intercourse in the public interest. The expression \"between one State and another does not imply that it is only intended to confer upon the Union the power to remove the fetter upon legislative authority only so as to keep trade, commerce or intercourse free between one State Government and another. It is intended to declare trade, commerce and intercourse free between residents in one State and residents in another State. That is clear because Art. 302 expressly provides that on the freedom of trade restrictions may be imposed not only as between one State and another, but also within any part of the, territory of India. As we have already observed, Art. 301 does not merely protect inter-State trade or operate against inter- State barriers : all trade is protected whether it is intra- State or interState by the prohibition imposed by Art. 301 , and there is nothing in the language or the context for restricting the power of the which it otherwise possesses in the public interest to impose restrictions on the freedom of trade, commerce or intercourse, operative only as between one State and another as two entities. 'Mere is also no doubt that exercise of the power to tax may normally be presumed to be in the public interest. Article 303 provides, by the first clause: ", "\"Notwithstanding anything in article 302 , neither nor the of a State, shall have power to make any law giving, or authorising the giving of, any preference to one State over another, or making, or authorising the making of, any discrimination between one State and another., by virtue of an entry relating to trade and commerce in any of the Lists in the Seventh Schedule.\" ", "Having conferred by Art. 302 power upon the to impose restrictions upon freedom of trade, commerce or intercourse, the Constitution proceeds to impose certain restrictions upon the power so conferred. Reference to the power of in Art. 303 (1 ) creates a complication which we are not called upon in the present case to resolve. It is expressly declared that the shall not have the power to make any law giving preference to one State over another, authorising the giving of any preference to one State over another, making any discrimination between one State and another, and authorising the making of any discrimination between one State and another, in exercise of or by virtue of any entry relating to trade and commerce in any of the Lists in the Seventh Schedule. ", "It was contended on behalf of the State that the power under Art. 303 could only be exercised so as to restrict the authority of the which arises by virtue of an entry relating to trade and commerce in the legislative lists and it was urged that an entry with respect to the levy of tax on trade and commerce and is not an entry relating to trade and commerce and therefore there is no prohibition against the exercising power or authorising the giving of any preference to one State over another or making or authorising the making of any discrimination between one State and another by the exercise of taxing power. Reliance in support of that contention was placed upon the judgment in (1) in which J., pointed out that under he scheme of entries in List I & III of the Seventh Schedule the power of taxation exercisable in respect of any matter is a power distinct from the power to legislate in respect of that matter. It was also urged that the expression \"an entry relating to trade and commerce in any of the Lists in the Seventh Schedule\" was restricted to the entries which expressly deal with the power to legislate in respect of trade and commerce i.e., entries 41 & 42 of List I, entries 26 & 27 of List II and entry 33 of List III in the Seventh Schedule, and (1) S. C R. 1422. ", "843 ", "extended to no others. On the other hand it was contended that all legislative entries which directly affect trade and commerce are also within the expression \"entry relating to trade and commerce\". ", "We need express no opinion on the two questions argued before us. The question whether entries relating to trade and commerce in the Lists in the Seventh Schedule are restricted to entries 41 & 42 of List I, entries 26 & 27 of List II and entry 33 of List III, or relate to all general entries which affect trade and commerce, is academic in the present case. Nor do we think it necessary to decide whether for the purpose of Art. 303 entries relating to tax on sale or purchase of goods i.e., entry 92A of List I, and entry 54 of List II are entries relating to trade and commerce, for, in our opinion, an Act which is merely enacted for the purpose of imposing tax which is to be collected and to be retained by the does not amount to law giving, or authorising the giving of, any preference to one over another, or making, or authorising the making of, any discrimination between one and another, merely because of varying rates of tax prevail in different s. It was urged that was right in holding that rates of tax on the sale of the same or similar commodity by different s by itself was discriminatory, since it authorised placing of an unequal burden on inter- trade and commerce affecting its free flow between the s. The rates of tax prevailing in different s on transactions of sale in the diverse commodities are undoubtedly not uniform. According to such a scheme was \"obviously quite discriminatory and considerably affected the freedom of trade, commerce and inter-Course\", the differential rates or exemptions in various , imposing an unequal burden on the same or similar goods which affected their free movement or flow in inter- trade and commerce, and that a higher rate of tax in a worked as a barrier to the free movement of similar goods to another where there was no tax or a lower rate of tax, and for trade in particular goods declared or undeclared to be free throughout the territory of India, the rate of tax or exemption as the case may be must be uniform. We are unable to accept the view propounded by . The flow of trade does not necessarily depend upon the rates of sales tax : it depends upon a variety of factors, such as the source of supply, place of consumption, existence of trade channels, the rates of freight, trading facilities, availability of efficient transport and other facilities for carrying on trade. Instances can easily be imagined of cases in which notwithstanding the lower rate of tax in a particular part of the country goods I may be purchased from another part, where a higher rate of tax prevails. Supposing in a particular in, respect of a particular commodity, the rate of tax is 2 % but if the benefit of that low rate is offset by the freight which a merchant in another . may have to pay for carrying that commodity over a long distance, the merchant would be willing to purchase the goods from a nearer , even though the rate of tax in that may be higher. Existence of long-standing business relations, availability of communications, credit facilities and a host of other factors-natural and business--enter into the maintenance of trade relations and the free flow of trade cannot necessarily be deemed to have been obstructed merely because in a particular the rate of tax on sales is higher than the rates prevailing in other s. ", "In The King v. Barger(1) was called upon to deal with the meaning of the expression \"discrimination between States or parts of States\" used in S. 51 of the Australian Constitution, Isaacs, J., observed at p. 108 : ", "\". . . . . the pervading idea is the preference of locality merely because it is locality, and because it is a particu lar part of a particular State. It does not include a differentiation based, on other considerations, which are dependent on natural or business circumstances, and may operate with more or less force in different localities; and there is nothing, in my opinion, to prevent , charged with the welfare of the people as a whole, from doing what every State in the Commonwealth has power to do for its own citi- zens, that is to say, from basing its taxation measures on considerations of fairness and justice, always observing the constitutional injunction not to prefer States or parts of States.\" ", "In v. () and others(1), of recorded its approval to that exposition. It is true that was interpreting s. 51(ii) of the Australian Constitution. It also appears from the provisions of the Australian Constitution that by virtue of s. 96 of the Constitution there is to be a uniform imposition of customs duties. But the observations made by , J., in King v. Barger(1) and approved by are useful in the determination of the true principle applicable in the present case, that, it is where differentiation is based on consideration not dependent upon natural or business factors which operate with more or less force in different localities that the is prohibited from making a discrimination. ", "The rates of tax in force at the date when the Central Sales Tax Act was enacted have again not become crystallized. The (1) 6 C. L R. 41. ", "(2) [1940] 63 C. L. R. 338. ", "845 ", "rate which determines, subject to the maximum prescribed for goods referred to in s. 8 ( 1 ) and (2) are the operative rates for those transactions : in respect of transactions falling within S. 8 (2) (b) the rate is determined by the rate except where the rate is between the range of two and seven per cent. The rate which a Legislature imposes in respect of inter- transactions in a particular commodity must depend upon a variety of factors. A may be led to impose a high rate of tax on a commodity either when it is not consumed at all within the , or if it feels that the burden which is falling on consumers within the will be more than offset by the gain in revenue ultimately derived from outside consumers. The imposition of rates of sales tax is normally influenced by factors political and economic. If the rate is, so high as to drive away prospective traders from purchasing a commodity and to resort to other sources of supply, in its own interest the will adjust the rate to attract purchasers.............. Again, in a demo- cratic constitution political forces would operate against the levy of an unduly high rate of tax. The rate of tax on sales of a commodity may not ordinarily be based on arbitrary considerations but in the light of the facility of trade in a particular commodity, the market conditions- internal and external--and the likelihood of consumers not being scared away by the price which includes a high rate of tax. Attention must also be directed to sub-s. (5) of s. 8 which authorises the Government, notwithstanding anything contained in s. 8 , in the public interest to waive tax or impose tax on sales at a lower rate on inter- trade or commerce. it is clear that the legislature has contemplated that elasticity of rates consistent with economic forces may be maintained. ", "Prevalence of differential rates of tax on sales of the same commodity cannot be regarded in isolation as determinative of the object to discriminate between one State and another. Under the Constitution as originally framed, revenue from sales-tax was reserved to the States. But since the power of taxation could be exercised in a manner prejudicial to the larger public interests by the States it was found necessary to restrict the power of taxation in respect of transactions which had an inter-State content. Amendment of Art. 286 and the enactment of the Sales Tax Validation Act 1956, and the Central Sales Tax Act , 1956, were all intended to serve a dual purpose: to maintain the source of revenue from sales-tax to the States and at the same time to prevent the States from subjecting transactions in the course of interState trade so as to obstruct the free flow of trade by making commodities unduly expensive. The effect of the Constitutional pro,visions achieved in a somewhat devious manner is still clear, viz. ", "846 ", "to reserve sales-tax as a source of revenue for the States. The Central Sales Tax Act is enacted under the authority of , but the tax is collected through the agency of the State and is levied ultimately for the benefit of the States and is statutorily assigned to the States. That is clear from the amendments made by the Constitution (Sixth Amendment) Act, 1956, in Art. 269 , and the enactment of cls. (1) & (4) of s. 9 of the Central Sales Tax Act. The Central sales-tax though levied for and collected in the name of is a part of the sales-tax levy imposed for the benefit of the States. By leaving it to the States to levy sales-tax in respect of a commodity on intrastate transactions no discrimination is practiced: and by authorising the State from which the movement of goods commences to levy on transactions of sale Central sales-tax, at rates prevailing in the State, subject to the limitation already set out, in our judgment, no discrimination can be deemed to be practised. ", "The view taken by was largely influenced by two cases decided by this Court on the interpretation of Art. 304(a). In Firm A. T. B. Mehtab Majid & Co.'s case(1) this Court struck down the levy of tax on sales of tanned hides and skins imported from outside the of Madras at a rate higher, than the rate of tax on sales of hides and skins tanned and sold within the of Madras as infringing Art. 304(a). By r. 16 framed under s. 19 of the Madras General Sales Tax Act, it was provided that in the case of untanned hides and skins the tax under s. 3 (1) of the Madras General Sales Tax Act shall be levied from the dealer who is the last purchaser in the not exempt from tax under s. 3 (3) on the amount for which they are brought by him. By r. 16(2) it was provided that-(i) in the case of hides or skins which had been tanned outside the the tax under s. 3 (1) shall be levied from the dealer who in the is the first dealer in such hides or skins not exempt from tax under s. 3(3) on the amount for which they are sold by him; and (ii) in the case of tanned hides or skins which had been tanned within the , the tax under s. 3 (1) shall be levied from a person who is the first dealer in such hides of skins not exempt from tax under s. 3(3) on the amount for which they are sold by him. The taxpayer contended in Firm A. T. B. Mehtab Majid's case(1) that the tanned hides and skins imported from outside and sold inside the were under r. 16 of the Madras General Sales Tax Rules subjected to a higher rate of tax than the rate imposed on hides and skins tanned and sold within the and this-discriminatory system of taxation offended Art. 304(a) of the Constitution: This Court accepted the contention and held that r. 16(2) discriminated against imported hides or skins which had been purchased or (1) Supp. 2 S. C. R. 435. ", "847 ", "tanned outside and therefore it contravened Art. 304(a) of the Constitution. ", "Similarly in (1) the assessees who were dealers in skins in the State of Madras, purchased raw skins from places both within and outside the State of Madras. They were assessed to sales-tax in accordance with the provisions of the Madras General Sales Tax (Turnover and Assessment) Rules, on the turnover of hides and skins purchased in the untanned condition outside the State and tanned within the State with respect to the assessment years 1955-56, 1956-57 and 1957- ", "58. The tax was assessed at 3 pies per rupee on the price of tanned hides and skins for the years 1955-56 and 1956-57 and at the rate of 2 per cent on the turnover for the year 1957-58. In petitions filed by the assessees in this Court under Art. 32 of the Constitution it was held that S. 2(1) of the Madras General Sales Tax (Special Provisions) Act, 1963, discriminated against imported hides and skins which were sold upto August 1, 1957, upto which date the tax on sale of raw hides and skins was at the rate of 3 pies per rupee and was therefore void. ", "In the two cases the differential treatment violated Art. 304(a) of the Constitution, which authorises the of a notwithstanding anything in Arts. 301 and 303 by law to \"Impose on goods imported from other s or the territories any tax to which similar goods manufactured or produced in that are subject, so however, as not to discriminate between goods so imported and goods so manufactured or produced;\". Imposition of differential rates of tax by the same on goods manufactured or produced in the and similar goods imported in the is prohibited by that clause. But where the taxing is not imposing rates of taxon imported goods different from rates of tax on goods manufactured or produced, Art. 304(a) has no application. Article 303 prohibits the making of law which gives, or authorises the giving of, any preference to one over another, or makes, or authorises the making of, and discrimination between one and another. Prevalence of different rates of sales-tax in the which have been adopted by the Central Sales Tax Act for the purpose of levy of tax under that Act is, as already mentioned, not determinative of the giving of preference or making a discrimination. The view expressed by that s. 8(2), 8(2A) and 8(5) infringe Art. 301 and Art. 303(1) cannot be sustained. ", "It was contended before that whereas excise duty was not liable to be included in the turnover of goods under the Madras General Sales Tax Act, it was liable to be included (1) [1964] 8 S. C. R. 217. ", "848 ", "in the turnover for the purpose of Central Sales Tax Act . in making a general discussion on this question observed, following the judgment of this Court in (1) that by \"levied\" in s. 9(1) ,of the Central Act , what was meant was \"levied as under the State Act \", that would include also the State Rules enabling deductions in the computation of the turnover. The Court rejected the contention that \"to the extent the excise duty is not deductible from taxable turnover under the Central Act unlike under the Madras General Sales Tax Act, there is discrimination .... between one State and another\". They observed that : ", "\"In the matter of non-deductibility of excise duty from the turnover of sales, the Central Act has equal application and makes no discrimination. The Central Act does not say that excise duty will be deductible in one State and not in another. It is not deductible from the turnover of the inter- State sales and this rule is uniformly applied to all sales. There is, therefore, no question of inequality or discrimination forbidden by Art. 303(1) and there is no question of contravention of Art. 301 either.\" ", "But in dealing with the case of the assessee in the last paragraph ,of the judgment, observed that since no provision had been made for deduction of the excise duty from the turnover of inter-state sales or purchases under the Central Act with the result that unequal burden will fall on differences in the quantum of turnover because of allowance in the one case and disallowance in another, of deduction of excise duty. This in the view of would impede the freedom of inter-State trade, com- merce and intercourse within the meaning of Art. 301 of the Constitution and was not saved by Art. 303. The observations so made, somewhat blur the earlier discussion. If under the Madras General Sales Tax Act in computing the turnover the excise duty is not liable to be included and by virtue of S. 9 (1 ) ,of the Central Sales Tax Act has to be levied in the same manner as the Madras General Sales Tax Act, the excise duty will not be liable to be included in the turnover, and the observations made in the last paragraph 'of the judgment under appeal that because no express provision was made for exclusion of the excise duty in the computation of turnover from inter-State sales or purchases there was discrimination cannot be accepted as correct. We are of the view that in the matter of determining the taxable turnover the same rules will apply by virtue of S. 9 (1) of the Central Sales Tax Act , whether the tax is to be levied under the Central Sales Tax Act or the General Sales Tax Act . ", "(1) 16 S. T. C. 231. ", "849 ", " proceeded to determine the case before them only on the plea that the impugned provisions of the Act were ultra vires. They did not consider whether the transactions in dispute were inter-State transactions and liable to tax in the hands of the assessee in the Madras State. It is the case of the assessee that he has been taxed in the Andhra Pradesh State by the appropriate authority in respect of the transactions of sale of goods which are sought to be taxed, on the footing that the transactions were inter-State transactions. The question whether the transactions were inter-State and were liable to be taxed under the Madras General Sales Tax Act has not been determined. The case must therefore be remanded to . will proceed to decide the question. Since the assessee moved by a writ petition against the order of the sales-tax authorities without filing an appeal before the authority competent to deal with the questions of fact, it will be open to to require the assessee to have those questions determined by the competent departmental authority. ", "The appeal will be allowed and the order passed by declaring the provisions of ss. 8(2) , 8(2A) . and 8(5) ultra vires must be set aside. ", "The petition out of which this appeal arises was one of a group of petitions filed before . Against orders passed in favour of the other assessees the State has not preferred appeals. The amount involved in the claim is small. The State apparently has approached this with a view to obtain a final determination of the important question which was raised in the petitions filed before . We therefore direct that there will be no order as to costs in this and in . , J. I have read the draft judgment prepared by our learned brother Justice . He has said that tax under the Central Sales Tax Act on inter-State sales is in its essence a tax hampering movement of trade or commerce, since by the definition in sec. 3 of the Act a sale or purchase of goods is deemed to take place in the course of inter-State trade or commerce, if it (a) occasions the movement of goods from one State to another; or (b) is affected by a transfer of documents of title to the goods during their movement from one State to another. He is of the view that the tax falls within the prohibition imposed under Art. 301 of the Constitution. ", " (1) Gajendra- gadkar, J. speaking for the majority of the Court said:- ", "\"We are, therefore, satisfied that in determining the limits of the width and amplitude of the freedom (1) [1961] 1 S. C. R. 809, 86D-861. ", "850 ", "guaranteed by Article 301 a rational and workable test to apply would be: Does the impugned restriction operate directly or immediately on trade or its movement.... It is the free movement of the transport of goods from one part of the country to the other that is intended to be saved, and if any Act imposes any direct restrictions on the very movement of such goods it attracts the provi- sions of Article 301 , and its validity can be sustained only if it satisfies the requirements of Art. 302 or Article 304 of Part XIII.\" ", "This interpretation of Article 301 was not dissented from in (1) . (2) this Court rejected the contention that sec. 21 of the Andhra Pradesh Sugarcane (Regulation of Supply and Purchase) Act , 1961 (Andhra Pradesh Act No. 45 of 1961) did not offend Article 301. The Court held : \"Normally, a tax on sale of goods does not directly impede the free movement or transport of goods. Section 21 is no exception. It does not impede the, free movement or transport of goods and is not violative of Article 301.\" ", "This Court distinguished the case of Firm v. State of Madras(3) which decided that a sales tax which discriminated against goods imported from other States might affect the free flow of trade and would then be invalid unless protected by Article 304(a). It is implied in Art. 304(a) that a discriminatory tax might affect freedom of trade. ", "On principle I see no distinction between a tax on intra- State and a tax on sales. An sale may occasion the movement of goods from one part of the State to another part of the same State. Indeed, normally, an sale would occasion such movement, because the purchaser has to move the goods from the seller's place to some other place. An sale may also be affected by a transfer of documents of title to the goods during their movement from one part of the State to another part of the same State. But, there can be no doubt that a tax on such sales would not normally offend Article 301. That Article makes no distinction between movement from one part of the State to another part of the same State and movement from one State to another. Now, if a tax on intra- State sale does not offend Article 301 , logically, I do not see how a tax on sale can do so. Neither tax operate directly or immediately on the (1) (1) S.C.R. 491, 533 (2) 21 S. T. C. 212. ", "(3) [1963] Supp. 2 S. C. R. 435. ", "851 ", "free flow of trade or the free movement of the transport of goods from one part of the country to the other. The tax is on the sale. The movement is incidental to and a consequence of the sale. ", " (1) , J. after referring to Art. 301 said \"Now it is not disputed that a tax on a purely internal sale which occurs as a result of the transportation of goods from a manufacturing centre within the State to a purchasing market within the same State is clearly permissible and not hit by anything in the Constitution. If a sale in that kind of trade can bear the tax and is not a burden on the freedom of trade, it is difficult to see why a single point tax on the same kind of sale where a State boundary intervenes between the manufacturing centre and the consuming centers need be treated as a burden, especially where that tax is ultimately to come out of the residents of the very State by which such sale is taxable. Freedom of trade and commerce applies as much within a State as outside it. It appears to me again, with great 'respect, that there is no warrant for treating such a tax as in any way contrary either to the letter or the spirit of the freedom of trade, commerce and intercourse provided under Article 301.\" ", "As at present advised, I am inclined to agree with these observations. I am, therefore, inclined to think that normally a law imposing a tax on intra-State sales does not offend Art. 301. It seems to me that the Central Sales Tax Act , 1956 is no exception to this rule. None of its provisions directly impede the movement of goods or the free flow of trade. ", "I may add that even assuming that the Central Sales Tax Act , 1956 is within the mischief of Art. 301 , it is certainly a law made by in the public interest and is saved by Art. 302. find nothing in the Act which offends Art. 303(1). ", "The decision of that section s. 8 (2), 8 (2A), and 8(5) of the Central Sales Tax Act , 1956 are ultra vires the Constitution must therefore be set aside. I agree to the order proposed by ", ", Though I agree with the conclusions reached by my learned brother , , namely, sections 8(2) , 8 (2-A) and 8(5) of the Central Sales Tax Act , 1956 (No. 74 of 1956)- hereinafter referred to as the Act-are intra vires the Constitution, my reasons for coming to that conclusion are not the same as his. Hence this note. ", "(1) [1955] 2 S. C. R. 603 at p. 754. ", "852 ", "The facts of the case as well as the history of the legislation are fully set out in the majority judgment. It is settled by the decisions of this in (1) and the (2) that a taxing statute is not outside the, scope of Art. 301 of the Constitution. But before a taxing statute is held to be violative of that Article, it must be shown that it has a direct or immediate impact on the freedom of trade, commerce and intercourse within the country. In other words, a mere remote or incidental impact is insufficient to hold that Art. 301 has been contravened. Article 302 empowers by law to impose such restrictions on the freedom of trade, commerce and intercourse between one and another or within any part of the territory of India, as may be required in the public interest. The power conferred on is extremely wide and the only limitation placed on that power by Art. 302 is that the law in question must be required in the public interest. Primarily it is for to determine the requirements of public interest. The decision of in this regard is not easy to challenge. is presumed to know the needs of the people, the requirements of the time and the economic and political interests of the country as a whole. By its very composition it is unlikely that would have re- gional bias or would adopt a parochial approach. In addition, there is the presumption of the constitutionality of a statute. Therefore the undoubtedly starts with an advantage. But once it is shown that a measure prima facie gives preference to the residents of one over another or it makes discrimination between the residents of a and that of another because of the adoption of different rates of tax in different s, then the matter assumes a different complexion in view of Art. 303 (1). It should be within the knowledge of why adopted different rates in different s. I agree that mere difference in rates is neither showing preference nor making discrimination. But other things being equal, the difference in rates would result in showing preference to some s and making discrimination against others. Hence, in my opinion, difference in rates is a prima facie proof of the preference or discrimination complained of. It is for the to justify those differences. The real question for decision is whether the impugned provisions have given or authorised the giving of any preference to one over another or made or authorised the making of any discrimination between one and another. The word \"\" in Art. 301 is used in the sense of people residing in that . It is impossible for any ordinary person to establish positively the preference or the (1) 1 S. C. R. 809. ", "(2) [1963] 1 S. C. R. 491. ", "853 ", "discrimination complained of, apart from showing the difference in the rates. Once he shows the difference in the rates, it is for the to show that the same has not resulted in showing preferences to one or more s over others or making discrimination against one or more s over others in the matter of inter- trade. I am not prepared to place an interpretation on Art. 303(1) which would render that provision purposeless. After all it is the that had enacted the impugned provisions. It must have had good reasons for enacting those provisions. It must place before court those reasons and satisfy it that Art. 303(1) has not been contravened. But on the material placed before us, I am satisfied that the differences in the rates are in public interest and those differences do not materially affect the free flow of trade in the country. From the history of the legislation, it is clear that the subject of taxing inter- sales is a complicated process. It has various facets. Sales-tax is one of the most important sources of revenue for the s. It was so even under the Government of India Act, 1935. It was not the intention of either to dry up that source or to divert the same. It wanted to retain that source for the s; but at the same time guard against s levying sales tax on inter- sales in a manner which is likely to be prejudicial to the free flow of trade and commerce in the country. Constitutional amendments referred to in the judgment of have an important purpose behind. them. Same is the case as regards the provisions in the Act. Before Articles 269 and 286 were amended and the Act enacted, a Committee known as , had gone into the various aspects of inter- trade and commerce and made recommendations to on that subject. It was largely on the basis of those recommendations that Articles 269 and 286 of the Constitution were amended and the Act enacted. Therefore it is clear that the Act is not a haphazard legislation; it is the product of deep thinking and clear analysis of the various aspects of the matter. This will be slow to hold such a. measure as being either not in public interest or is violative of Art. 303(1). The question of giving preference or making discrimination depends on various facts and circumstances, the tax rate being only one of them. The views of an expert committee on a subject so complicated as tax on inter sales is entitled to great weight. In the very nature of things, it is difficult for courts to ascertain the various factors that impede the free flow of trade or to assess their importance. This is not the same thing as saying that this should abdicate its functions in favour of an expert committee or should unduly exaggerate the importance of the collective knowledge and, wisdom of the members of . But the fact remains that in assessing the strength of economic in a given matter the views of persons who may be expected to be familiar with the subject is entitled to weight and in the absence of clear proof .to the contrary or unless it is shown that their conclusions are obviously wrong, it will be proper for this to proceed on the basis that the conclusions reached by them on facts-not on questions of law-are correct. The has given good reasons in support of its recommendations. ", "We shall now examine the purposes behind s. 8 of the Act, which fixes rates of tax on sales in the course of inter- State trade, commerce and intercourse. The Act divides inter-State sales into four categories, namely--4i) sales to Government, (ii) sales of goods which are declared to be of special importance in the inter-State trade and commerce, ", "(iii) sales to registered dealers, and (iv) sales to others. Good many sales in the course of interState sales are made to Governments. In a welfare State like ,ours, public sector is in-charge of various industries, which require raw material from various parts of the country. The Governments also require consumer goods of various types for its governmental functions as well as for its economic activities. A uniform rate is fixed for those sales under s. 8(1)(a). Hence in respect of an important segment of inter-State sales the rate is uniform, no doubt subject to s. 8(2-A), the scope of which I shall discuss a little later. ", "Section 14 declares that goods enumerated therein are goods ,of special importance in the inter-State trade and commerce. Section 15 prescribes the restrictions and conditions under which sales tax in respect of the turnover relating to those goods may be levied. One of the conditions prescribed at the relevant time was that tax should not be more than two percentum of the turnover. Further in respect of those goods only a single point taxa- tion is permissible. The declared goods constitute a large portion of the goods sold in inter-State trade. The incidence of taxation on those goods is such that it could not have had any serious repercussion on inter-State trade. Section 8(1)(b) regulates the sales tax leviable on sales to registered dealers in the course of inter-State sales. The maximum rate fixed at the relevant time was two percentum of the turnover. All that the registered dealer has to do _is to get included in his certificate of registration goods of the class or ,classes which he proposes to purchase as being intended for resale by him or for use by him in the manufacture or processing goods for sale or in the mining or is the generation or distribution of electricity or any other form of power. Here again the incidence of taxation is so low as ordinarily not to affect the, free flow of trade. ", "This takes us to the remaining sales in the course of inter- trade or commerce. By and large these sales are made to unregistered dealers. Here again, so far as the declared goods are concerned, tax has to be levied at the rate applicable to local sales, as provided in s. 8(2)(a) . Then we come to cl. (b) of s. 8(2) , which deals with goods other than declared goods. Here the law at the relevant time was that the tax shall be calculated at the rate of seven percentum of the turnover or at the rate applicable to sale or purchase of such goods inside the appropriate , whichever is higher. As could be seen from the report of , the main reason for this provisions was to prevent as far as possible the evasion of sales tax. The was. anxious that inter- trade should be canalised through registered dealers over whom the appropriate government has a great deal of control. It is not very easy for them to evade tax. A measure which is intended to check the evasion of tax is undoubtedly a valid measure. Further, inter- trade carried on through dealers coming within s. 8(2) , must be in the very nature of things very little. It is in public interest to see that in the guise of freedom of trade, they do not evade the payment of tax. If the sales tax they have to pay is as high or even higher than intra- sales tax then they will be constrained to register themselves and pay the tax legitimately due. The impact of this provision on inter- trade is bound to be negligible, but at the same time it is an effective safeguard against evasion of tax. Section 8 (2-A) is incorporated with a view to see that the consumers in the s to which goods are imported are not placed at a disadvantage as compared to the consumers in the from which the goods are imported. In fact this provision is bound to facilitate inter- trade. The purpose behind the section is to see that the Governments do not place the local consumers in a better position than the consumers outside. ", "Sub-section (5) of s. 8 provides for giving individual exemptions in public interest. Such a power is there in all taxation measures. It is to provide for unforeseen contingencies. Take for example, when there was famine in Bihar, if a dealer in Punjab had undertaken to sell goods to a charitable society in that State at a reasonable price for distribution to those who were starving, it would have been in public interest if had exempted that dealer from paying sales tax. Such a power cannot immediately or directly affect the free flow Sup C.1.168-15 of trade. The power in question cannot be said to be bad. If there is any misuse of that power, the same can be challenged. ", "It must be remembered that under the present conditions the power to tax is not merely used for the purpose of collecting revenue; it is a powerful social instrument, in particular an instrument which can be effectively used for correcting economic maladjustments. While the legislature must provide in the law for all reasonably foreseeable contingencies, still some discretionary power has to be given to the executive to meet unexpected situations. If we bear in mind the fact that sales tax on sales is levied for the benefit of the s and the further fact that each one of the Governments in its own interest is bound to create the best possible condition for the growth of industry and commerce in that , it is reasonable to assume that they will not be blind to economic forces. All that one has to guard against is to see that they do not, by having recourse to their taxation power, obstruct the flow of trade into their . In the normal course they will be interested in seeing that goods produced in their s are sold outside. Reasonably sufficient safeguards against the free flow of trade into a have been provided by the provisions of the Act, firstly, by providing for the levy of sales tax in the in which the goods are produced, and, secondly, by placing various restrictions on the power of the s in fixing the rates. None of the impugned provisions, in my opinion, has direct or immediate impact on trade or commerce. ", " allowed and remanded."], "relevant_candidates": ["0000302808", "0000304499", "0000424874", "0000514162", "0000608874", "0001105204", "0001291316", "0001432872"]} {"id": "0001395554", "text": ["PETITIONER: . Vs. RESPONDENT: ITS WORKMEN DATE OF JUDGMENT: 24/09/1959 BENCH: GAJENDRAGADKAR, P.B. BENCH: GAJENDRAGADKAR, P.B. SINHA, BHUVNESHWAR P. SUBBARAO, K. CITATION: 1960 AIR 160 1960 SCR (1) 806 CITATOR INFO : F 1960 SC 762 (13) R 1960 SC1262 (4) R 1961 SC 689 (7) R 1961 SC 860 (8) R 1963 SC 601 (6) F 1965 SC 917 (5) R 1965 SC1803 (11) F 1968 SC 231 (14) R 1971 SC2171 (5) R 1971 SC2417 (7,11) R 1972 SC 136 (33) R 1972 SC 277 (10) RF 1972 SC1031 (21,51) E 1973 SC1227 (18,20) F 1978 SC 995 (6,10,12) R 1978 SC1380 (8) RF 1978 SC1428 (18,20) RF 1979 SC1652 (18) RF 1980 SC1896 (148) RF 1981 SC 422 (4) RF 1990 SC1054 (19) ACT: Industrial Dispute-Dismissal by employer pending adjudication -Omission to hold proper enquiry or obtain permission of the -Such dismissal, if wholly void-- Jurisdiction of , Scope of-Pen-down strike-Legality_ If disentitles a dismissed employee to reinstatement- Industrial Disputes Act , 1947 , ss. 2(q) , 10 , 33 , 33A . HEADNOTE: The employees of the appellant commenced pen-down strikes, which were followed by a general strike, pending arbitration of an industrial dispute between them. intervened and as the result of an agreement that followed the reinstated all the employees except 150, against whom it had positive objections, and the Government referred their cases under s. 10 of the Industrial Disputes Act, 1047, to for adjudication. The two issues before were whether the 150 employees had been wrongly dismissed and what wages and allowances would the 807 employees be entitled to on reinstatement. The case of the employees was that the wanted to penalise the active trade union workers by the said dismissals while the maintained that the employees were guilty of participation in illegal strikes intended to paralyse its business and scare away its customers. did not hear evidence and, by its final award, held that, the strikes being illegal, the was, on that ground alone, justified in dismissing the employees. Even so, it directed the to make certain payments to the employees on compassionate grounds. The as well as the employees appealed. held that even though the strikes were illegal under s. 23(b) read with s. 24(1) of the Industrial Disputes Act, 1947, the had, by entering into the agreement with , waived its right to take penal action against the employees for joining the illegal strikes and that, therefore, an enquiry should be held on additional evidence to decide the disputes on merits. Against this interlocutory order the appealed to this and it was held by this that while the strikes were no doubt illegal under s. 23(b) of the Act, the orders of dismissal passed by the were no less so under s. 33 of the Act, and it dismissed the appeal. , thereafter, heard the cases on merits, directed-the reinstatement of 136 of the said employees, but refused to reinstate the rest whom it found guilty of issuing posters and circulars subversive of the credit of the . Both the parties appealed to this . Preliminary objections were raised on behalf of the said employees that, (1) in view of the decision of this dismissing the 's appeal against the said interlocutory order the subsequent inquiry by the and the orders of dismissal must be held to be void and, (2) no charges having been admittedly framed nor any proper enquiry held by the against the employees, the orders of dismissal were wholly invalid. It was urged, inter alia, on behalf of the in the appeals that participation in a pen-down strike by itself amounted to misconduct sufficient to disentitle an employee to reinstatement and that the entire body of strikers, being collectively responsible for the publication of the subversive documents in question, the dismissed employees could by no means escape liability. Held (per curiam), that the preliminary objections must be negatived and the decision of the Appellate affirmed with this modification that, in view of its inconsistent findings, the appeal of one of the employees must be allowed. Per and , JJ.-The purpose the had in view in enacting s. 33 of the Industrial Disputes Act, 1947, was to maintain the status quo by placing a ban on any action by the employer pending adjudication. But the jurisdiction conferred on by S. 33 of the Act was a limited one. Where a proper enquiry had been held and no victimisation or unfair labour practice had been 808 resorted to, the in granting permission had only to satisfy itself that there was a Prima facie case against the employee and not to consider the propriety or adequacy of the ,proposed action. But to such permission, when granted, the could attach no conditions; it can either grant or refuse it. The effect of such permission was only to remove the ban imposed by s. 33 of the Act. It could neither validate a dismissal nor prevent it from being challenged in an industrial dispute; but in such a dispute, when raised, the employer could justify its action only on such grounds as were specified in the original charge-sheet and no others. There was substantial difference between non-compliance with s. 33 of the Act and that with Art. 311(2) of the Constitu- tion. Compliance with s. 33 only avoided the penalty under s. 31(1) of the Act, while compliance with Art. 311(2) of the Constitution made the order of dismissal final. , S.C.R. 780, , 1 S.C.R. 1241, , S.C.R. 916, Indian lron and , S.C.R. 667 and , S.C.R. (Suppl.) 222 referred to. It was not, therefore, correct to contend that non- compliance with s. 33 of the Act could render the orders of dismissal wholly void or take away the jurisdiction of the to hold the enquiry. Nor could the failure to hold a proper enquiry have that effect. Under s. 33A of the Act, as construed by this , the jurisdiction of the was not limited to an enquiry as to the contravention of s. 33 of the Act. Even if such contravention was proved, the employer could still justify the impugned dismissal on merits and there was no difference in this regard between a reference under s. 10 of the Act and a dispute raised under s. 33A of the Act. , 1 S.C.R. 1241 and v. , A.I.R. 1958 S C. 761, referred to. Although there can be no doubt that in proper cases has the power to direct reinstatement in disputes arising out of dismissal of employees, it is not possible to Jay down any hard and fast rule to be applied to such cases. In coming to its decision, has to reconcile the conflicting claims of the employer and the employee,--the latter's right to protection against wrongful dismissal, and in such a case the normal rule is reinstatement, and the interest and safety of the industry itself. Its approach to such a problem cannot, therefore, be legalistic or doctrinaire or as is permissible 809 in a civil court deciding the validity of dismissals under S. 240 of Act, 1935, or Art. 311(2) of the Constitution. , F.C.R. 321 and , (1955) 11 L.L.J. 314, referred to. If no enquiry is held by the employer before it passes an order of dismissal, the propriety of such dismissal can be adjudged by the on evidence and no employer can be allowed to object to it on the ground that it interferes with the exercise of its managerial function. , (1904) , (1951) 11 L.L.J. 204, distinguished and held inapplicable. The propriety of reinstatement in a case of wrongful or illegal dismissal is normally a question of fact and where on a proper consideration of the relevant factors refuses to pass such an order this would be reluctant, in absence of any general or substantial question of law, to interfere under Art. 136 of the Constitution. A pen-down strike falls within the definition of a strike contained in S. 2(q) of the Industrial Disputes Art, 1947, and is not Per se illegal. Even if it might involve an element of civil trespass as in the present case, that cannot disentitle an employee to reinstatement. , A.I.R. 1959 S.C. 529, referred to. It is not safe to extend principles of American decisions to such a strike without a careful scrutiny of the relevant provisions of the American Statute and the facts on which the said decisions are based. v. , 306 U.S. 238, considered and held inapplicable. v. , 66 Law. Ed. 311, referred to. Since in the instant case, the peaceful and non-violent conduct of the strikers, as found by the Appellate , could not amount to criminal trespass within, the meaning of s. 441 of the Indian Penal Code , mere participation in the pen-down strike did not disentitle them to reinstatement. v. King-emperor, (1934) L.R. XIII Pat. 268, held inapplicable. The mere fact that the employer had engaged new hands during the strike, was not sufficient to defeat the claim to reinstatement of such employees as were subsequently found to have been wrongfully dismissed. v. The Workmen, C.A. NO. 312 of 1956, decided on January 22, 1957, referred to. 810 But where, as in the instant case, the Appellate took a common-sense view of the matter of evidence and held certain office-bearers and leaders of the union liable for subversive acts and refused to extend such liability to the entire body of strikers on theoretical and academic grounds, no principles of natural justice could be said to have been contravened by it. JUDGMENT: ", "CIVIL APPELLATE JURISDICTION: Civil Appeals Nos. 519 to 521 of 1958. ", "Appeal by special leave from the decision dated January 4,1955, of , Calcutta, in Appeals Nos. Cal. 69152 and Cal. 70/52. ", "AND Civil Appeal No. 521 of 1958. ", "Appeal by special leave from the decision dated January 4, 1955, of , Calcutta in Appeal No. Cal 70/52. ", " and , for the appellant in C.A. No. 519 of 58. ", ", Additional Solicitor-General of India, and , for the appellants in C.A. No. 520/58 and respondents in C.A. NO. 521 of 58. , Attorney-General for India, , Solicitor-General, , , , Miss. and , for respondent No. 1 in C.A. Nos. 519 and 520 of 58 and appellant in C.A. No. 521 of 58. ", " and , for respondent No. 2 in C.As, Nos. 519 & 520 of 58. ", "1959. September 24. The judgment of and , ., was delivered by , , J., delivered a separate judgment. appeals arise out of an industrial dispute between (hereinafter called the ) and two sets of its employees represented by the. All-India Punjab National Employees' (hereinafter called the ) and the U.P. Employees' Union hereinafter called the Union) respectively. ", " ", "On July 2, 1951, this dispute was referred by for adjudication to the industrial tribunal of which Mr. , a retired Judge of,, , was the sole member. It raised two issues. The first was whether the 150 workmen mentioned in Sch. 11 attached to the reference had been wrongfully dismissed by the , and the second had reference to the claim for reinstatement and payment of wages and allowances from the date of dismissal to the date of reinstatement. The reference thus made has gone through a long and protracted career and the final decision of the dispute would be reached after we dispose of the present appeals. In order to appreciate the points raised for our decision in these appeals it is necessary to indicate briefly at the outset the salient points of controversy between the parties, the findings made by the original tribunal, the conclusions reached by in its interlocutory and final judgments and the decision of this in the appeal which had been brought before it by the against the interlocutory judgment of . ", "The 150 employees, whose dismissal has given rise to the present dispute are spread over several branches of the . 52 of them work at its head office in Delhi, 15 in Bombay, 73 in East Punjab and 10 in U.P. 140 workmen in the first three areas are represented by the while the last 10 in U.P. are represented by the . All of these employees took part in strike which, according to the , were illegal. The strikes in which the two respective groups of workmen took part were, however, for different reasons. ", "The strike in which the took part was the result of the suspension by the of its typist employed in the Delhi Branch of the on April 17, 1951. It appears that , who was the Secretary of the Punjab National Employees' , Delhi, had applied for leave for seven days on April 3, 1951, but his application was rejected; even so he absented himself from duty and went to Bombay. As soon as he resumed his duties on April 14, 1951, he was supplied with a written chargesheet for absence without leave which he refused to accept. It was then sent to him by registered post, and on April 17 he was suspended. This suspension was followed by an immediate pen-down strike at the head office of the Delhi Branch subsequent to which the suspended 60 other employees. This led to a general strike in Delhi and many other branches and it commenced at different dates from April 18 to 20, 1951. On April 21-22, 1951, the issued notices calling upon all striking members of the staff to report for duty by 10 a. m. on April 24, 1951, and it warned them that if they did not comply with the notice it would be taken that they had voluntarily ceased to be its employees and their services would be deemed to have terminated from that date. This was followed by another notice on April 24 which announced that the strikers who had failed to report for duty as aforesaid had ceased to be the employees of the from April 24, 1951. An option was, however, given to the strikers who were still willing to rejoin duty to apply in that behalf and explain their action in staying away. It is common ground that the 140 employees represented by the who had taken part in the strike were dismissed by the for absence due to the strike. That is the genesis of the dispute between the and the in relation to the 140 employees of the . The strike in which the remaining 10 employees of the from the U.P. branches are concerned commenced on April 23, 1951. This strike was in pursuance of the strike notice served by the on the on April 22, 1951. This pen-down strike was a part of the general strike which affected not only the but also the Allahabad and other banks in the U.P. region. The Regional Labour Commissioner of the U.P. who intervened suggested that the general strike should be called off and recommended that some of the demands made by the strikers should be referred to the industrial tribunal for adjudication; in accordance with this request, on April 30, 1951, the strike committee decided to call off the strike and Advised workmen to join duty from May Is 1951. This advice, however, did not reach all the branches in time with the result that some of the employees of the offered to resume work on May 3,1951. The other banks in the U.P. region took back their employees who rejoined on May 3, but the refused to take back its employees on the ground that they' had not offered to rejoin on or before the date fixed; and so it proceeded to dismiss them. The dismissal of the said 10 employees is also the subject-matter of the present reference. That is bow the reference is concerned with the dismissal of 150 employees of the in all. The strikes in question which affected the head office and the large number of branches of the operating in more than one State and a very large number of its employees caused public concern, and so the Prime Minister and of thought it necessary to intervene; and a conference was arranged at New Delhi between the officers of the and the . To this conference the representatives of the or the were, however, not invited. This conference led to an agreement as a result of which the undertook to reinstate all its employees who had taken part in the strikes except those to whose reinstatement it had \" positive objections\". This, however, was subject to the reservation that the number of such employees was not to exceed 150 and that their case,-, would be referred by for adjudication by a tribunal. This agreement was the result of several meetings between the representatives of the and of and it was reached on or about May 9, 1951. ", "Thereafter the head office of the sent a circular letter to all its branches calling for names of the employees who according to the branch managers could not be considered for reinstatement. The list of such employees received by the head office from the respective managers of its branches was examined by the head office and the then compiled the list of 150 workmen whom it was not prepared to reinstate. This list was in due course communicated by the to ; and in pursuance of the agreement aforesaid referred the dispute in respect of the said 150 workmen for adjudication before the tribunal by its notification issued on July 2, 1951. Before the tribunal the case for the and the was that the refusal of the to take back the 150 workmen in question was a part of the concerted and deliberate plan adopted by the management of the for victimising the President, the Vice-President, the General Secretary and Secretaries and Treasurer of the and of the working committees of the different trade unions of workers and the members of the strike committees, and it showed that the sole object of the in refusing to take back those employees was to teach a lesson to the and -the and to penalise all active trade union workers who supported the cause of the employees. On the other hand, the contended that the strikes in which the 150 employees had participated were illegal and had been resorted to not with a view to obtain relief for the employees but with a view to paralyse the business of the and to scare away its customers. The further alleged that the said 150 employees were guilty of \" unpardonable acts of violence, intimidation, coercion and victimisation.\" ", "The tribunal gave two interim awards by which it directed the to make some payments to the 150 employees by way of allowance pending the final disposal of the dispute. On February 2, 1952, the tribunal pronounced its final award. It held that the strikes were illegal and that the' was entitled to dismiss the employees solely on the ground that the said employees had participated in an illegal strike. On this view the tribunal did not think it necessary to allow evidence to be given on the question as to whether some of the strikers were guilty of specific subversive or violent acts. It also did not allow evidence to be led by workmen in support of their plea that their dismissal was the result of victimisation. It decided the dispute on the sole ground, that the strikes were illegal and participation in illegal strikes justified the dismissal of the employees. Even so the tribunal made an order directing the to pay certain amounts to the said employees on compassionate grounds. ", "The direction issued by the tribunal for the payment of the said amount was challenged by the by its appeal (No. 25 of 1952) before (hereinafter called the appellate tribunal), whereas the decision of the tribunal that the 150 employees were not entitled to reinstatement was challenged by the two sets of employees by two different appeals (Nos. 69 and 70 of 1952). The appellate tribunal recorded its interlocutary decision on September 22, 1952. As a result of this decision the dispute was set down for further hearing on the points indicated by it. It was urged by the before the appellate tribunal as a preliminary objection that the appeals preferred by the employees were incompetent. This objection was overruled. The appellate tribunal then proceeded to consider two questions of law, (1) whether an employer has the right to dismiss a workman for his absence from duty by reason of his mere participation in an illegal strike, and (2) if he has, can the tribunal scrutinise the exercise of that right and grant relief to such a workman when it comes to the conclusion that the right has been exercised capriciously or by unfair labour practice. The appellate tribunal held that the strike started by the was illegal under s. 23 (b) read with s. 24 (1) of the Industrial Disputes Act , 1947 (herein- after called the Act). It appears that on February 21, 1950, an industrial dispute between the and the had been referred to the arbitration of Mr. , and whilst the proceedings in the said reference were pending before the tribunal the strike was commenced on or about April 17, 1951. That is why the strike was illegal. The appellate tribunal, however, held that, even if mere participation in an illegal strike by workmen is assumed to give the employer certain rights against the striking workmen, the employer can waive these rights, that is to say, rafrain from exercising those rights against the workmen. According to the appellate tribunal such waiver or relinquishment can be inferred from conduct, and it thought that the conduct of the evidenced by the agreement which it reached with on or about May 9, 1951, unambi- guously proved that it had waived or relinquished its rights to take any penal action against its employees merely for their participation in the illegal strike. In other words, the effect of the findings of the appellate tribunal was that, though the strike was illegal, by its conduct the had precluded itself from exercising its alleged right to dismiss its employees for their participation in such an illegal strike. ", "The appellate tribunal also considered the general question of law as to whether participation in an illegal strike can be said to deserve dismissal of the striking workmen. It took the view that an illegal strike absolves the liability of the employer to pay to its employees wages during the period of absence of the striking workmen, but that it cannot be stated as a general proposition that participation in an illegal strike would by itself necessarily involve the penalty of dismissal. The attempted to justify the dismissal in the present case by urging that the 150 employees were guilty of violent or subversive acts but the appellate tribunal held that it was not open to the at that stage to plead in justification of their dismissal any such acts of violence or subversive acts. \" There is abundant authority \", observed the appellate, tribunal, \" for the proposition that an employer can justify before the tribunal a dismissal only on the ground on which he purported to dismiss him and not a ground different from it \". That is why in the end the appellate tribunal held that the dismissals were wrongful. The appellate tribunal had no doubt that mere participation by a workman in an illegal strike or his absence due to such participation does not entitle an employer to dismiss him and that it is open to a tribunal to order reinstatement in a proper case. Having reached this conclusion the appellate tribunal observed that \"though in the case of wrongful dismissals the normal rule is that the employees wrongfully dismissed should be reinstated, it would nevertheless be necessary to consider the question of reinstatement in the case of each individual employee in the light of requirements of social justice and fair play for which the employee claims and industrial peace and discipline which the employer emphasizes.\" In order to decide the cases of the several employees from this twofold point of view the appellate tribunal thought it was necessary to allow the parties to lead additional evidence on relevant points. The employees wanted to lead evidence in support of their case of victimisation and they were allowed to do so by the appellate tribunal. The wanted to lead evidence on five points. The appellate tribunal held that evidence on items (3) and (5) would be irrelevant and it thought that item (4) was too vague. That is why 'the was allowed to lead evidence only in respect of item (2) and some heads mentioned in item (1). In the result opportunity was given to the parties to lead evidence on the following points: (1) victimisation, (2) past service records of the 150 employees, (3) conduct of those 150 employees or any of them during the strike confined to acts of violence, intimidating loyal workers and acts subversive of the credit of the , (4) employment which any of those 150 persons got after this dismissal, the period during which they were in employment and the wages or emoluments they received. The appellate tribunal then directed the to file a statement within a month giving particulars of the acts confined to the matters on which the was allowed to lead evidence in respect of each one of the 150 employees after supplying a copy of the same, one to the and one to the . In the meanwhile the appellate tribunal directed the to make interim payments to the employees as indicated in its order. This interlocutary judgment was challenged by the before this Court by its appeal under Art. 136 of the Constitution. On behalf of the it was urged that the conclusion of the appellate tribunal that the had condoned the illegal strike by its workmen was unjustified and that it was open to the to rely upon the illegal strike as justifying the dismissal of the said workmen. The case of the thus was that the order passed by the appellate tribunal setting down the dispute for further enquiry was illegal and should be set aside. The judgment of this Court delivered by , C. J., shows that this Court thought it unnecessary to express any opinion on the question of condonation or waiver of the illegal strike because, in its opinion, even if there was no such condonation or waiver and even if it was open to the to rely upon the illegal strike as a valid ground for dismissing its employees, there was no doubt that the order of dismissal was illegal having regard to the provisions of s. 33 of the Act. The said section furnished a short answer to the 's contention that the appellate tribunal had no jurisdiction to order reinstatement of the 150 workmen. In other words, just as the strike of the employees was illegal so was the order of dismissal passed by the illegal and for a similar reason. S. 23(b) of the Act made the strike illegal while s. 33 of the Act made the dismissal also illegal. In the result the appeal preferred by the was dismissed; and it was held that there was no substance in the plea of the that the appellate tribunal had no jurisdiction to direct reinstatement of the employees. This judgment was pronounced on April 10, 1953. The proceedings before the appellate tribunal were subsequently resumed and they terminated on January 4, 1955, when the appellate tribunal directed the reinstatement of the 136 employees and passed incidental orders about the payment of their wages. It refused to reinstate the remaining 14 employees but passed orders in regard to payment of compensation even in their cases. Before the appellate tribunal four general points were sought to be raised at this subsequent hearing. The first was in regard to the invalidity of the reference itself. The second was in regard to the ultra vires character of the relevant provisions of the Act. Both these contentions were not allowed to be raised by the appellate tribunal and they have not been urged before us either. The third contention' raised was that both the strikes were not bona fide and so the striking workmen were not entitled to reinstatement; and the last contention was that the pen-down strike was illegal and participation in it should be considered as a circumstance disqualifying the strikers from reinstatement. The appellate tribunal has held that the strikes in question were bona fide and that mere participation in the pen-down strike cannot be treated as a valid ground for refusing reinstatement to the strikers. It considered the evidence led by the parties in regard to the character of the strike, and it held that the definite instruction issued to the employees was to continue occupation of their seats till the police intervened and threatened to arrest and so it was not prepared to accept the employees' case that the pen-down strikers \"vacated their seats on the mere asking by the management\" According to the finding, the persons who took part in the pen-down strike not only ceased to work but continued to occupy their seats. The appellate tribunal also found that the pen-down strikers were quiet and peaceful, that no slogans were shouted, no attempt at violence or coercion was made and that they simply occupied their seats without doing any work. ", "It was conceded before the appellate tribunal that pen-down strike falls within the definition of strike prescribed by s. 2(q) of the Act; but it was urged that the act of not vacating their seats when asked by the management to do so introduced an element of illegality and made the strikers liable in a civil court for trespass. The appellate tribunal was not impressed with this argument but it held that even if the striking workmen are assumed to have made themselves liable for civil trespass that itself would not be sufficient ground for refusing reinstatement. It appears that the relied upon several documents to show that the employees were guilty of subversive actions during the course of the strike. The appellate tribunal was not satisfied that these documents were genuine and could be effectively pressed into service by the in support of its case. It was also urged by the that during the course of the strike posters and circulars were issued which were clearly subversive of the credit of the and it was contended that employees who were guilty of issuing such posters and circulars did not deserve reinstatement. The appellate tribunal examined these documents and held that three of them amounted to sub- versive acts. They are Exs. 255(a), 255(c) and 302. In regard to Ex. 302 the findings recorded by the appellate tribunal in two places of its decision are somewhat inconsistent; but the operative portion of the decision shows that the appellate tribunal was inclined to hold that Ex. 302 was also objectionable and that it amounted to a subversive act. The rest of the documents no doubt used strong and intemperate language but the appellate tribunal was not prepared to treat them as constituting subversive activity. On this finding a question which arose before the appellate tribunal was : Who should be held responsible for the offending documents ? The appellate tribunal was not prepared to hold all the 150 employees responsible for them. In this connection it considered the statement made by in this evidence and it field that since had admitted that he consulted 11 specified persons in preparing Exs. 255(a) and 255(c) as well as other documents they must share the responsibility for the said documents along with . Similarly the appellate tribunal held that the persons who were shown to have been responsible for Ex. 302 must be treated on the same basis. It was as a result of this finding that the appellate tribunal refused to direct reinstatement of 14 employees. In regard to the remaining 136 employees the appellate tribunal held that it would not be right to impute the responsibility for the publication of the three subversive documents to them merely because they were members of the working committee or were otherwise active leaders of the . The appellate tribunal the considered the voluminous evidence led by the parties in respect of each one of the 150 employees, and it held that in regard to the 136 employees no case had been made out by the for refusing them reinstatement. ", "It is clear from the decision of the appellate tribunal that it was not at all satisfied with a substantial part ,of the documentary evidence adduced by, the . It held that the affidavits filed by the were sometimes prepared en masse and the deponents simply put their signatures on them. In most of the affidavits there were blank spaces for the name, parentage and age of the deponents and they have been subsequently filled up in ink. Some of them, though sworn at different places, used identical language; while in some others material additions and alterations have been made which do not bear the initials either of the deponents or of the oath commissioner. It appeared to the appellate tribunal that some of the statements made by the witnesses of the showed that their affidavits had been prepared by the 's lawyers and they simply put their signatures thereon and affirmed them before the oath commissioner. Indeed the appellate tribunal apparently thought that there was some force in the contention raised by the employees that some of the documents produced by the had been manufactured or tampered with long after the strike was over, It has noticed the argument urged by the that even if it was so the cannot be condemned for the act or acts of its branch managers in that behalf. This argument did not appeal to, the appellate tribunal. Thus the decision of the appellate tribunal substantially upheld the case made by the employees in that it directed the rein- statement of the 136 out of the 150' employees and ordered payment of compensation to the remaining 14 whose reinstatement was not granted. ", "This decision has given rise to the three present appeals before us. Civil Appeal No. 519 of 1958 has been filed by the against the order of reinstatement in respect of 126 employees represented by the . Similarly Civil Appeal No. 520 of 1958 has been filed by the against the order directing the reinstatement of 10 employees represented by the ; and Civil Appeal No. 521 of 1958 has been filed by the on behalf of the 14 employees the claim for whose reinstatement has been rejected. In regard to the first two appeals preferred by the special leave was granted to the on February 21, 1958, limited to grounds (b), (c), ", "(d), (f) and (g) set out in paragraph 162 of its petitions. These grounds are:- ", "(b) Whether employees, who have been propagating against the stability and solvency of the by propaganda oral as well as written through open letters, posters, leaflets and hand-bills amongst the customers and constituents of the and the public at large before, during and after an illegal strike are entitled to an order of reinstatement ? ", "(c) Whether after the declaration of an illegal strike, forcible occupation of the seats and refusal to vacate them, when ordered to do so by the Management, does not constitute as act of criminal trespass, it having been held by the appellate tribunal that the employees formed a large riotous assembly in and outside the premises of the Bank and delivered fiery and provocative speeches to accompaniment of scurrilous slogans directed against the institution and its high officers with a view to render impossible the business of the institution, are entitled to an order of reinstatement ? ", "(d) Whether a 'pen-down' strike of such a character does not contravene the provisions of the law of the land and is exempted under the Trade Unions Act or the Industrial Disputes Act ? ", "(f ) Whether employees, who, notwithstanding the fact that they resorted to an illegal strike and were guilty of rioting, had been invited by the Management to come back and resume work and who spurned at this offer and in so many words treated it with contempt and whose places had, therefore, to be replaced by fresh recruits are entitled to an order that those fresh recruits be dismissed and replaced by the strikers ? ", "23 ", "(g) Whether it is open to the employees of a concern to raise with their Employers a question as to whether the Employers should employ in their service employees of a concern other than their own and whether such a question constitutes an 'industrial dispute' within the meaning of the Industrial Disputes Act ? ", "It may be mentioned that the 's petitions had raised several other grounds in paragraph 162 -but leave has not been granted to the to raise any of them. Almost a month and a half after limited leave was thus granted to the the filed its petition for special leave on April 4, 1955, and it applied for condonation of delay made in presenting the petition. On April 9, 1956, this granted the employees' application for condonation of delay and gave special leave to them to prefer their appeal. This leave has not been limited to any particular grounds. Broadly stated these are the relevant facts which give rise to the three present appeals. Before dealing with the merits of these appeals we must consider two preliminary objections raised by the learned Attorney-General on behalf of the employees. He has claimed that if these objections are upheld the 's appeals would have to be dismissed and the employees' appeal allowed without considering the merits of the orders under appeal. In pressing these objections he urged that the questions raised were of considerable importance, and, though he conceded that some aspects of the matter were covered by the previous decisions of this , he requested us to examine the whole question afresh once more. We would accordingly deal with these contentions at some length. The first contention is that as a result of the decision of this in the appeal preferred by the against the interlocutary judgment of the appellate tribunal, the whole of the enquiry held by the said tribunal pursuant to the said interlocutary judgment is invalid and infructuous. This has held that the dismissal of the 150 employees is illegal having regard to the provisions of s. 33 of the Act; if the dismissal is illegal it is void and inoperative and as such it cannot be said to have terminated the relationship of master and servant between the and its employees. Despite the said order of dismissal the employees continued to be in the employment of the, and are entitled to reinstatement without any further enquiry. That, it is said, is the effect of the 's failure to comply with the provisions of s. 33 . ", "It is next contended that the does not dispute the fact that it had held no enquiry into the alleged misconduct of its employees before it passed the impugned: orders of dismissal against them. It is well established that even where an employer is justified in terminating the services of his employees he is bound to give them a charge-sheet and hold a proper enquiry at which they would have, a chance to meet the said charge-sheet. This requirement is universally treated as,consistent with natural justice and fairplay and since the has not complied with it the impugned orders of dismissal are wholly invalid for this additional reason; and the result again would be that the said orders are inoperative and void and the employees are entitled to reinstatement as a matter of course. ", "In support of this argument reliance has been placed on the decision of in the case of The High Commissioner for India and High Commissioner for Pakistan and (1). This decision holds that the order of dismissal passed against a person who is a member of in India without complying with the mandatory relevant provisions of s. 240 of the Government of India Act, 1935, is void and inoperative, and that the Civil Servant against whom such an order is passed is entitled to a declaration that he remained a member of at the date of the institution of the suit in which he challenged the validity of the impugned order. Similarly in (2), this Court has held that an order of dismissal passed against a public servant specified in Art. 311(a) with out complying with the mandatory (1) 75 1. A. 225. ", "(2) [1958] S.C.R. 1080. ", "825 ", "provisions of Art. 311 (2) is void and that the public servant sought to be dismissed by such an invalid order continued to be a member of the service at the date of the institution of the suit. It is in the light of these decisions that the learned Attorney-General asks us to hold that the relationship between the and its employees remains wholly unaffected by the' orders of dismissal passed by the against them; and so, as soon as the orders are held to be void nothing more remains to be done but to make a declaration about the the continuance of the relationship of master and servant between the parties and to direct reinstatement. Thus presented the argument no doubt appears prima facie to be attractive; but in our opinion, a careful examination of the relevant sections of the Act shows that it is not valid. ", "The three sections of the Act which are relevant are ss. 33 , 33A and 10 . Let us first consider s. 33 . This section has undergone several changes but we are concerned with it as it stood in 1951. It provides inter alia that during the pendency of any proceedings before a tribunal in respect of any industrial dispute no employer shall discharge or punish, whether by dismissal or otherwise, any workman concerned in such dispute save with the express permission in writing of the tribunal. It is clear that in cases to which this section applies a ban has been imposed on the power of the employer to dismiss his employees -save with the express permission in writing of the ,tribunal. The object of the in enacting this section is obvious. By imposing the ban s. 33 attempts to provide for the continuance and termination of the pending proceedings in a peaceful atmosphere undisturbed by any causes of friction between the employer and his employees. In substance it. insists upon the maintenance of the status quo pending the disposal of the industrial dispute between the parties; nevertheless it recognises that occasions may arise when the employer may be justified in discharging or punishing by dismissal his employees; and so it allows the employer to take such action subject to the condition that before doing so he must obtain the express permission in writing of the tribunal. It is true that the ban is imposed in terms which are mandatory and s. 31(1) makes the contravention of the provisions of s. 33 an offence punishable as prescribed therein. But the question which calls for our decision is: What is the effect of such contravention on the decision of the industrial dispute arising from it ? ", "Where an application is made by the employer for the requisite permission under s. 33 the jurisdiction of the tribunal in dealing with such an application is limited. It has to consider whether a prima facie case has been made out by the employer for the dismissal of the employee in question. If the employer has held a proper enquiry into the alleged misconduct of the employee, and if it does not appear that the proposed dismissal of the employee amounts to victimisation or an unfair labour practice, the tribunal has to limit its enquiry only to the question as to whether a prima facie case has been made out or not. In these proceedings it is not open to the tribunal to consider whether the order proposed to be passed by the employer is proper or adequate or whether it errs on the side of excessive severity; nor can the tribunal grant permission, subject to certain conditions, which it may deem to be fair. It has merely to consider the prima facie aspect of the matter and either grant the permission or refuse it according as it holds that a prima facie case is or is not made out by the employer. ", "But it is significant that even if the requisite permission is granted to the employer under s. 33 that would not be the end of the matter. It is not as if the permission granted under s. 33 validates the order of dismissal. It merely removes the ban; and so the validity of the order of dismissal still can be, and often is, challenged by the union by raising an industrial dispute in that behalf. The effect of compliance with the provisions of s. 33 is thus substantially different from the effect of compliance with s. 240 of the Government of India Act, 1935, or Art. 311(2) of the Constitution. In the latter classes of cases, an order of dismissal passed after duly complying with the relevant statutory provisions is final and its validity or propriety is no longer open to dispute; but in the case of s. 33 the removal -of the ban merely enables the employer to make an order of dismissal and thus avoid incurring the penalty imposed by s. 31(1) . But if an industrial dispute is raised on such a dismissal, the, order of dismissal passed even with the requiste permission obtained under s. 33 has to face the scrutiny of the tribunal. The decisions of this Court show that this position is well established. (1) this Court was dealing with the provisions of cl. 23 of the relevant notification which is similar to the provisions of s. 33 of the Act. \" The enquiry to be conducted by the Regional Conciliation Officer under the said clause \", observed , J., \" was not an enquiry into an industrial dispute as to the non- employment of workmen who was sought to be discharged or dismissed which industrial dispute would only arise after an employer, his agent or manager discharged or dismissed the workman in accordance with the written permission obtained from the officer concerned. The only effect of obtaining permission from the officer concerned was to remove the ban imposed on the employer. But the order of dismissal passed after obtaining the requisite permission can still become the subject-matter of an industrial dispute under s. 2(k) of the Act and the workman who has been dismissed would be entitled to have the industrial dispute referred to the appropriate authority. \" ", " . (2), this Court was dealing with a similar problem posed by the provisions of s. 22 of Act 48 of 1950, and s. 33 of the Act. Dealing with the effect of these sections this Court held that the object of s. 33 was to protect the workmen against the victimisation by the employer and to ensure the termination of the proceedings in connection with the industrial disputes in a peaceful atmosphere. That being so, all that the tribunal, exercising its jurisdiction under s. 33 , is (1) S.C.R. 780, (2) 1 S.C.R. 1241. ", "828 ", "required to do is to grant or withhold the permission, that is to say, either- to lift or to maintain the ban. This section does not confer any power on the tribunal 'to adjudicate upon any other dispute or to impose conditions as a prerequisite for granting the permission asked for by the employer. The same view has been ,expressed in (1). ", "In cases where an industrial dispute is raised on the ground of dismissal and it is referred to the tribunal for adjudication,-the tribunal naturally wants to know whether the impugned dismissal was preceded by a proper enquiry or not. Where such a proper enquiry has been held in accordance with the provisions of the relevant standing orders and it does not appear that the employer was guilty of victimisation or any unfair labour practice, that tribunal is generally reluctant to interfere with the impugned order. The limits of the tribunal's jurisdiction in dealing with such industrial disputes have been recently considered by this in the - (2 ) and it has been held that the powers of the tribunal to interfere with cases of dismissal are not unlimited because the tribunal does not act as a court of appeal and substitute its own judgment for that of the management. In this judgment this has indicated the classes of cases in which the tribunal would be justified in interfering with the impugned order of dismissal. It would and should interfere when there is want of good faith, when there is victimisation or unfair labour practice, when the management has been guilty of a basic error or violation of the principle of natural justice, or when, on the materials, the finding of the management is completely baseless or perverse. The same view has been again expressed by this in , and Its Workmen (3). ", "There is another principle which has to be borne in mind when the tribunal deals with an industrial dispute arising from the dismissal of an employee. We have already pointed out that before an employer can (1) [1956] S.C.R. 916. (2) [1958] S.C.R. 667. (3) (1959) 1 L.L.J. 285. ", "829 ", "dismiss his employee he has to hold a proper enquiry into the alleged misconduct of the employee and that such an enquiry must always begin with the supply of a specific charge-sheet to the employee. In (1), it has been held by this Court that in dealing with the merits of the dismissal of an employee the employer would be confined to the' charge-sheet given by him to his employee when an enquiry was held into his conduct. It would not be open to the employer to add any further charges against the employee and the case would have to be considered on the original charge-sheet as it was framed. It is significant that in the case of (1), this Court was apparently inclined to take the view that the additional acts of insubordination on which the appellant-mills wanted to rely would have justified the employee's dismissal; but even so it was not allowed to raise that plea because the said plea had not been included in the original charge-sheet. It, therefore, follows that where a proper enquiry has been held by the employer and findings are recorded against the employee that the principles laid down by this Court in the case of (2)would be applicable; and in applying the said principles the employer would be confined to the grounds set out by him in his charge-sheet against the employee. ", "This position is not disputed before us. Indeed the learned Attorney-General contends that the principles applicable to the decision of an industrial dispute arising from the dismissal of an employee to which we have just referred serve to emphasise the obligatory character of the limitation imposed on the employer by s. 33 of the Act and by the requirements of natural justice that every dismissal must be preceded by a proper enquiry. Where the ban imposed by s. 33 of the Act has been defied and/or where a proper enquiry has not been held at all the action of the employer in dismissing his employee must be treated as void and inoperative. Such a case (1) S.C.R. 916. ", "(2) [1958] S.C.R. 667, stands outside the principles which we have discussed, so far. That in brief is the main contention raised by the employees. ", "This contention is, however, untenable in view of the decisions of this Court where the provisions of s. 33A have been construed and considered, and so we must now turn to s. 33A . This section was inserted in the Act in 1950. Before it was enacted the only remedy available to the employees against the breach of s. 33 was to raise an industrial dispute in that behalf and to move the appropriate for its reference to the adjudication of a tribunal under s. 10 of the Act. The trade union movement in the country complained that the remedy of asking for a reference under s. 10 involved delay and left the redress of the grievance of the employees entirely in the discretion of the appropriate ; because even in cases of contravention of s. 33 the appropriate was not bound to refer the dispute under s. 10 . That is why s. 33A was enacted for making a special provision for adjudication as to whether s. 33 has been contravened. This section enables an employee aggrieved by such contravention to make a complaint in writing 'in the prescribed manner to the tribunal and it adds that on, receipt of such complaint the tribunal shall adjudicate upon it as if it is a dispute referred to it in accordance with the provisions of the Act. It also requires the tribunal to submit its award to the appropriate and the provisions of the Act shall then apply to the said award. It would thus be noticed that by this section an employee aggrieved by a wrongful order of dismissal passed against him in contravention of s. 33 is given a right to move the tribunal in redress of his grievance without having to take recourse to s. 10 of the Act. ", "After this section was thus enacted the scope of the enquiry contemplated by it became the subject matter of controversy between the employers and the employees. This Court bad occasion to deal with this controversy in the case of (1). , J., as he then was, who delivered (1) [1955] 1 S.C.R. 1241. ", "831 ", "the judgment of the Court construed s. 33A of the Act and the corresponding s. 23 of Act 48 of 1950, which applied to then in existence, and observed that \" the scheme of the section clearly indicates that the authority to whom the complaint is made is to decide both the issues, viz., (1) the effect of contravention, and (2) the merits of the act or order of the employer \". \" The provision in the section that the complaint shall be dealt with by the tribunal as if it were a dispute referred to or pending before it quite clearly indicates \", said the learned Judge, \"that the jurisdiction of the authority is not only to decide whether there has been a failure on the part of the employer to obtain the permission of the authority before taking action but also to go into the merits of the complaint and grant appropriate reliefs (p. 1253) \". It was urged before this Court that in holding an enquiry under s. 33A the tribunal's duty was only to find out whether there had been a contravention of s. 33 , and if it found that there was Such a contravention to make a declaration to that effect. The argument was that no further question can or should be considered in such as enquiry. This contention was, however, rejected. The same question was raised before this Court in (1) and following the previous decision of this Court in the case of (2) it was held that in an enquiry under s. 23 two questions fall to be considered: Is the fact of contravention of the provisions of s. 22 proved ? If yes, is the order passed by the employer against the employee justified on the merits ? Thus there can be no doubt that in an enquiry under s. 33A the employee would not succeed in obtaining an order of reinstatement merely by proving contravention of s. 33 by the employer. After such contra- vention- is proved it would still be open to the employer to justify the impugned dismissal on the merits. That is a part of the dispute which the tribunal has to consider because the complaint made by the employee is treated as an industrial dispute and all the relevant (1) A.I.R. 1958 S.C. 761. ", "(2) [1955] 1 S.C.R. 1241. ", "832 ", "aspects of the said dispute fall to be considered under 3. 33A. Therefore, we cannot accede to the argument that the enquiry under s. 33A is confined only to the determination of the question as to whether the alleged contravention by the employer of the provisions of s. 33 has been proved or not. ", "In the present case the impugned orders of dismissal have given rise to an industrial dispute which has been referred to the tribunal by the appropriate under s. 10 . There can be no doubt that if under a complaint filed under s. 33A a tribunal has to deal not only with the question of contravention but also with the merits of the order of dismissal, the position cannot be any different when a reference is made to the tribunal like the present under s. ", "10. What is true about the scope of enquiry under s. 33A is a fortiori true in the case of an enquiry under s. 10 . What is referred to the tribunal under s. 10 is the industrial dispute between the and its employees. The alleged contravention by the of s. 33 is no doubt one of the points which the tribunal has to decide; but the decision on this question does not conclude the enquiry. The tribunal would have also to consider whether the impugned orders of dismissal are otherwise justified; and whether, in the light o the relevant circumstances of the case, an order of reinstatement should or should not be passed. It is only after all these aspects have been considered by the tribunal that it can adequately deal with the industrial dispute referred to it and make an appropriate award. In this connection it would be relevant to remember that in dealing with industrial disputes arising out of dismissal of employees the tribunal undoubtedly has jurisdiction to direct reinstatement in proper cases. The question about the jurisdiction of an industrial tribunal to direct reinstatement was raised as early as 1949, before in (1). In this case considered the larger question about the powers of industrial tribunals in (1) F.C.R. 321. ", "833 ", "all its aspects and rejected the argument of the employer that to invest the tribunal with jurisdiction to order re- employment amounts to giving it authority to make a contract between two persons when one of them is unwilling to enter into a contract of employment at all. \" This argument \", observed , J., as he then was, \"overlooks the fact that when dispute arises about the employment of a person at the instance of a trade union or a trade union objects to the employment of a certain person, the definition of industrial dispute would cover both those cases. In each of those cases, although the employer may be unwilling to do so, there will be jurisdiction in the tribunal to direct the employment or non-employment of the person by the employer \". The learned Judge also added that \" the disputes of this character being covered by the definition of the expression 'industrial disputes, ' there appears no logical ground to exclude an award of reinstatement from the jurisdiction of the industrial tribunal.\" Since this judgment was pronounced the authority of the industrial tribunals to direct reinstatement in appropriate cases has never been questioned. ", "In exercising its jurisdiction to direct reinstatement of dismissed employees industrial tribunals have indicated certain general considerations for their own guidance. In the case of a wrongful dismissal the normal rule adopted in industrial adjudication is that reinstatement should be ordered. \"But\", observed of in And Their Workmen (1), \" in so ordering the tribunal is expected to be inspired by a sense of fair play towards the employee on the one hand and considerations of discipline in the concern on the other. The past record of the employee, the nature of his alleged present lapse and the ground on which the order of the management is set aside are also relevant factors for consideration.\" It is obvious that no hard and fast rule can be laid down in dealing with this problem. Each case must be considered on its own merits, and, in reaching the (1) [1951] 11 L.L.J.314. ", "834 ", "final decision an attempt must be made to reconcile the conflicting claims made by the employee and the employer. The employee is entitled to security of service and should be protected against wrongful dismissals, and so the normal rule would be reinstatement in such cases. Nevertheless in unusual or exceptional cases the tribunal may have to consider whether, in the interest of the industry itself, it would be desirable or expedient not to direct reinstatement. As in many other matters arising before the industrial courts for their decision this question also has to be decided after balancing the relevant factors and without adopting any legalistic or doctrinaire approach. No such considerations can be relevant in cases where in civil courts the validity of dismissals is challenged on the ground of non-compliance with s. 240 of the Government of India Act, 1935 or Art. 311(2) of the Constitution. There is one more point which still remains to be considered and that is the effect of the 's default it not holding an enquiry in the present case. If the has not held any enquiry it cannot obviously contend before the tribunal that it has bona fide exercised the managerial functions and authority in passing the orders of dismissal and that the tribunal should be slow to interfere with the said orders. It is true as we have already pointed out that if the employer holds a proper enquiry, makes a finding in respect of the alleged misconduct of the employee and then passes an order of dismissal the tribunal would be glow to interfere with such an order and would exercise its jurisdiction within the limits prescribed by this Court in The case of (1). ", "But it follows that if no enquiry has in fact been held by the employer; the issue about the merits of the impugned order of dismissal is at large before the tribunal and, on the evidence adduced before it, the tribunal has to decide for itself whether the misconduct alleged is 'roved, and if yes, what would be proper order to make. In such a case the point about the exercise of managerial functions does not arise at (3) [1958] S.C.R. 667, all. This answers the argument which Mr. has raised before us in his appeal. ", "Mr. , however, seeks to derive support to his argument from the decision of in (1). In that case the order of reinstatement passed by the tribunal was reversed in appeal by the appellate tribunal which observed that in dealing with cases of dismissal where the management had acted bona fide and with knowledge and experience of the problems which confronted in the daily work of the concern it should be considered to be well qualified to judge what sentence would be appropriate, and the sentence imposed by the management should normally stand subject to the qualification that it must not be unduly severe. It is obvious that in that case the management had held a proper enquiry and the question which arose for decision was what are the limits of the jurisdiction of the tribunal in dealing with an industrial dispute arising from an order of dismissal passed by an employer after holding a proper enquiry. The principles applicable to such a case have been already considered by us; but they can have no application to the present case where the employer has held no enquiry at all. Therefore, this decision on which Mr. relies is irrelevant. The position then is that the effect of the double default committed by the employer is not to limit the enquiry to the decision of the sole question as to the commission of the said default, and so, despite the said default the subsequent enquiry held by the appellate tribunal pursuant to its interlocutory judgment was proper and legal. The two preliminary objections raised by the learned Attorney_General must, therefore, fail. Let us now deal with the two appeals filed by the (Civil Appeals Nos. 519 and 520 of 1958). We have already indicated that in dealing with these appeals we have to bear in mind the limitations imposed by the nature of the limited leave granted to (1) (1951) 11 L L. J. 204. ", "836 ", "the ; it is only the grounds specifically covered by the leave which fall to be considered, and even these grounds will necessarily have to be dealt with in the light of the findings already recorded by the appellate tribunal which are no longer open to challenge. The subsequent enquiry held by the appellate tribunal was limited to the question as to whether the was able to prove any specific circumstances which disentitled the employees from claiming reinstatement. In other words, the object of the said enquiry was to ascertain the nature of the \"positive objections\" which the had against each one of them. The rest of the matters in dispute between the parties are concluded by the other findings which have become final. Considered in the light of these limitations the grounds on which leave has been granted to the must first be examined. A bare perusal of the said grounds would show that some of them are vague and they are urged on assumptions of fact which run counter to the findings recorded by the appellate tribunal. That is why when those appeals were urged before us, Mr. and Mr. have recast their contentions within the frame,-work of the grounds in respect of which leave has been granted and have urged the following points before us: (1) that participation in a pen-down strike is itself an activity of such a subversive character that it disqualifies the employees who took part in it from claiming the relief of reinstatement, (2) that the publication and circulation of subversive documents was the result of a concerted plan and represent a collective activity of all the strikers and as such all the employees before us should be held responsible for it and on this ground reinstatement should be refused to them, (3) that the finding recorded by the appellate tribunal that only 14 persons were directly and actively concerned with the preparation and publication of the subversive documents is opposed to the weight of evidence and is perverse, (4) that the appellate tribunal erred in law in not taking into account the fact that after the 150 employees were dismissed the has engaged fresh hands and the order of reinstatement would, therefore, be unjust and unfair, and (5) that the appellate tribunal was also in error in not taking into account the fact that some of the employees have in the meanwhile taken employment elsewhere. It is these five grounds which we are asked to consider by the in its present appeals. ", "Before dealing with these contentions we would like to make one general observation. Though not in the, same form, in substance these contentions were raised before the appellate tribunal in support of the plea that the dismissed employees should not be reinstated. As we have already emphasized whether or not reinstatement should be ordered in cases of wrongful or illegal dismissals is normally a question of fact and in deciding it several relevant factors have to be borne in mind. If the appellate tribunal applied its mind to those relevant factors and came to the conclusion that 14 employees did not deserve to be reinstated while the remaining 136 did, we would be reluctant to interfere with the said order under Art. 136 unless it is shown that the order suffers from an error which raises a general or substantial question of law. ", "The first contention raised by the is in regard to the conduct of the employees in entering upon a pen-down strike and its effect on their claim for reinstatement. The finding of the tribunal on this point is that the persons who took part in the pen-down strike not only ceased to work but continued to occupy their seats. A tumultuous crowd had gathered outside the premises of the and some persons in the crowd were shouting slogans in support of the strike. The strikers had been definitely instructed to stick to their seats until the police intervened and threatened arrest or until orders of discharge or suspension were served on them. There has been some argument before us as to the number of persons who actually took part in this kind of pen-down strike. For the Mr. has urged that the finding, of the appellate tribunal suggests that most of the strikers took part in this strike; and in any event, according to him, at least 52 persons took part in it. He has filed in this Court a list of these 52 employees. On the other hand, the learned Attorney-General has contended that on the findings recorded by the appellate tribunal not more than 10 persons can be said to have taken part in it. In dealing with the present contention of the we are prepared to assume that most of the strikers participated in the pen- down or sit-down strike as generally found by the tribunal. Is this pen-down strike a strike within s. 2(q) of the Act or not? S. 2(q) defines a strike as meaning a cessation of work by a body of persons employed in any industry acting in combination, or a concerted refusal, or a refusal under a common understanding, of any number of persons who are or have been so employed to continue to work or to accept employment. It was conceded before the appellate tribunal that a pen-down strike falls within this definition, and this position is not seriously disputed before us either. On a plain and grammatical construction of this definition it would be difficult to exclude a strike where workmen enter the premises of their employment and refuse to take their tools in hand and start their usual work. Refusal under common understanding to continue to work is a strike and if in pursuance of such common understanding the employees entered the premises of the and refused to take their pens in their hands that would no doubt be a strike under s. 2(q) . The main grievance of the is that these employees not only sat in their places and refus- ed to work but they would not vacate their seats when they were asked to do so by their superior officers. Such conduct may introduce an element of insubordination but that is a different matter. In our opinion, therefore, the pen- down strike in which the employees participated in the present case cannot be said to be outside s. 2(q) of the Act. ", "It was, however, urged that the entry of the strikers in the premises of the amounted to civil trespass. The argument is that by virtue of their employment the employees had a licence to enter the premises of the but this licence is subject to the condition that the employees are willing to carry out their obligation of the contract and do their allotted work during the, office hours. If the employees had decided not to work they were not entitled to the licence in question and so their entry into the itself constituted a civil trespass. On their hand, the employees contend that during the continuance of their employment they are entitled to enter the premises of the and having thus entered they were also entitled to exercise their right of going on strike. They entered the premises as employees of the and having taken their seats they exercised their right of striking work. If the had suspended the employees it would have been another matter; but so long as the relationship of master and servant continued the employees could not be said to have committed civil trespass when they entered the premises at the time. ", "In support of its case the has relied on the proposition that \" even if a person has a right of entry on the land of another for a specific purpose he commits a trespass if he enters for any other purpose or under any other claim or title apart from that under which he might lawfully enter. As an illustration of this proposition it is stated that if a person having a licence for entry on land enters the land not by virtue of the said licence but in order to contest the licensor's title, he commits a trespass \" (1). \" But this proposition is subject to the exception that if a person enters for a lawful purpose he is not a trespasser unless the case is one to which the doctrine of trespass ab initio applies \" (2). So the decision of this technical point would depend on whether or not the employees are given a limited or conditional licence to enter the premises and that if they have decided to go on strike the said conditional or limited licence is no longer available to them. We do not think it necessary to consider this academic question in the present proceedings because, in our opinion, the appellate tribunal was obviously right in holding that even if civil trespass was involved in the conduct of the employees that by itself cannot justify the rejection of their claim for reinstatement. Incidentally we may add that even (1) Salmond on Torts, 12th Ed., p. 158. ", "(2) Salmond on Torts, 12th Ed., p. 159. ", " ", "in America \" the simple act of trespassing upon the employer's property is no bar to reinstatement nor is the act which at most a civil tort \" (1). ", "Does the conduct of the strikers as found by the appellate tribunal constitute criminal trespass unders. 441 of the Indian Penal Code ?That is the next point which calls for decision.It is argued that the conduct of the employees amountsto criminal trespass which is an offence and as suchthose who committed criminal trespass would not be entitled to reinstatement. According to the the employees committed the criminal trespass inasmuch as they either entered unlawfully or having lawfully entered continued to remain there unlawfully with intent thereby to insult or annoy their superior officers. It would be noticed that there are two essential ingredients which must be established before criminal trespass can be proved against the employees. Even if we assume that the employ- ees' entry in the premises was unlawful or that their continuance in the premises became unlawful, it is difficult to appreciate the argument that the said entry was made with intent to insult or annoy the superior officers. The sole intention of the strikers obviously was to put pressure on the to concede their demands. Even if the strikers might have known that the strike may annoy or insult the 's officers it is difficult to, hold that such knowledge would necessarily lead to the inference of the requisite intention. In every case where the impugned entry causes annoyance or insult it cannot be said to be actuated by the intention to cause the said result. The distinction between knowledge and intention is quite clear, and that distinction must be borne in mind in deciding whether or not in the present case the strikers were actuated by the requisite intention. The said intention has always to be gathered from the circumstances of the case and it may be that the necessary or inevitable consequence of the impugned act may be one relevant circumstance. But it is impossible to accede to the argument that the likely consequence of the act and its possible knowledge (1) \"Labor Disputes and Collective Bargaining\" Vol. 11, p.855 must necessarily import a corresponding intention. We think it is unnecessary to elaborate this point; we would only like to add that the decision of , in v. King-Emperor (1) on which reliance was placed by the is wholly inconsistent with the contention raised by it. Thus our conclusion is that the has failed to prove that the conduct of the strikers as found by the appellate tribunal amounted to criminal trespass under s.441 of the Code . ", "In resisting the employees' claim for reinstatement on the ground that participation in a pendown strike creates a bar against such a claim the has strongly relied on the decision of in v. ). Both Mr. and Mr. have contended that this decision is an authority for the proposition that participation in pen-down strikes necessarily disqualifies the strikers from claiming reinstatement. It is, therefore, necessary to examine this case carefully. In this case, the bad directed the reinstatement of participants in a sit-down strike whom, upon their refusal to leave the employer's plant, the employer declared to be discharged. The Board had held that despite the illegal strike and the consequent order of discharge the status of the employees continued by virtue of the definition of the term \" employee \" in s. 2 , sub-s. (3) of the National Labor Relations Act. It had also taken the view that it had jurisdiction to direct reinstatement of the said employees under s. 10(c) of the said act with a view to effectuate the policies of the Act. Both these conclusions were reversed by by a majority judgment. According to the majority view, when the enacted the National Labor Relations Act it \" did not intend to compel employers to retain persons in their employ regardless of their unlawful conduct,-to invest those who go on strike with an immunity from discharge for acts of trespass or violence against the employer's property, which they (1) (1934) I.L.R. XIII Pat. 268. ", "(2) 306 U.S. 238; 83 Law. Ed. 627. ", "842 ", "would not have enjoyed had they remained at work.\" It was also held that \" the was intent upon ,.protection of employees' right to self-organisation and to the selection of representatives of their own choosing for collective bargaining without restraint or coercion. \" On the facts the conclusion of the majority was that the strike was illegal in its inception and prosecution. This was really not the exercise of the right to strike to which the Act referred. It was an illegal seizure of the building in order to prevent their use by the employer in a lawful manner, and thus by acts of force and violence compel the employer to submit. The conclusion, therfore, was that to provide for the reinstatement or re-employment of employees guilty of the acts which even according to the had been committed would not only not effectuate any policy of the Act but would directly tend to make abortive its plan for peaceable procedure. Mr. Justice , who delivered a dissenting judgment thought that both labour and management had erred grievously in their respective conduct and so it would not be unreasonable to restore both to their former status. That is why he was not prepared to reverse the order of reinstatement passed by the . The naturally relies upon the majority decision in support of its contention that its employees who participated in the pen-down strike are not entitled to reinstatement. In considering the question as to whether the principle underlying the majority decision should be, applied to a pen-down strike in India it is necessary to remember that the pen-down strike properly so-called is recognised as a strike under s. 2(q) of the Act and so it would not be safe to extend the principles of American decisions bearing on this question without a careful scrutiny of the relevant provisions of the American statute and the facts on which the said decisions are based. Let us then consider the facts on which the majority decision was based. It appears that an acrimonious dispute had been going on between the and its employees for some time before February 17,1937 when the pen-down strike commenced. The was not prepared to recognise the outside union and had employed a labor spy to engage in espionage within the union and continued the employment of the said spy. It also appears that the, super intendant of the when requested to meet the deputation of the union required that the deputation should consist only of employees of five years' standing. Subsequently the superintendent' refused to confer with the committee in which the outside Organisation had been included; and as a punitive measure he required the president of the union to work in a room adjoining his office with the purpose of keeping him away from the other workers. It was in this background of bitter relationship that the strike commenced. In the afternoon of February 17 the union committee decided upon a sit-down strike by taking over and holding two of the respondent's key buildings. These were then occupied by about 95 employees, as a result of which work in the plant stopped. In the evening the superintendent accompanied by police officials went to each of the building and demanded that the men leave. They, however, refused whereupon the respondent's counsel who had accompanied the superintendent announced in loud tone that all the men in the plant were discharged for the seizure and detention of the buildings. Even so the men continued to occupy the buildings until February 26. Their fellow members brought them food, blankets, stoves, cigarettes and other supplies. Meanwhile on February 18, the respondent obtained from the state court an injunction requiring the men to surrender the premises. The men refused to obey the order and a writ of attachment for contempt was served on them on February 19. When the men refused to submit a pitched battle ensued and the men successfully resisted the attempt by the sheriff to evict and arrest them. Efforts at mediation failed. Ultimately on February 26, the sheriff with An increased force of deputies made a further attempt and this time, after another battle, the men were ousted and placed under arrest. They were subsequently prosecuted and most of them were fined and given jail sentence for violating the injunctions. A bare statement of these facts would clearly bring out the true character of the strike with which was dealing. It was not merely an illegal but violent strike, ; it was a strike which began with the wrongful seizure of the employer's property and his exclusion from it; a strike accompanied by violence which led to pitched battles between the strikers and the sheriff's men; a strike continued by the strikers even after they were formally discharged from the employment and against an order of injunction by a competent court. It is difficult to accede to the argument that the majority decision in that case can be extended to the facts before us. As has observed \" the strike in question can be more accurately defined as a strike in the traditional sense to which is added the element of trespass of the strikers upon the property of the employer \". (1) Therefore, in our opinion, this decision does not assist the in support of its case that mere-participation in the illegal strike in the present case can by itself defeat the claim of the employees for reinstatement. ", "In this connection we may point out that, according to the decision marks \" what is hoped to be an end of an unfortunate chapter in the history of American labor activity\"; he has added that \" there is danger, however, in viewing the sitdown strike solely as the reflection of lawless labour leadership. The causes of its emergence are deeper. Indeed labour has contended that capital and labor share equal responsibility for its rise and development. No analysis of a sit-down strike can claim a broad view of the subject, says labor, without a full measure of consideration of the infamous Mohawk Valley methods used by to break strikes, nor to the facts elicited in the recent trial under the Byrnes Act........ The anarchy of law which resulted from unlawful employer utilisation of instruments of violence and chicanery in disregard of law needed the sit-down (1) Ludwig 's \"Labour Disputes and Collective Bargaining\", Vol 1, p. 311, s. 106 . ", "845 ", "strike as an effective counterpoise \" ; and so the author significantly concludes that \" it is no coincidence that statistics show a precipitate drop in the prevalence of sit- down strikes immediately upon validation by of the National Labor Relations Act.\" It is in the light of this background that had been( called upon to decide the question of reinstating employees in the case (1). ", "The history of the trade union legislation in England shows that the trade union movement had to wage a long and bitter struggle to secure recognition for the workmen's right to organise themselves into unions and to exercise their right of collective bargaining if necessary by the use of the weapon of strikes. In America a similar struggle took place, and, as we have just pointed out, it was marked by violence on the part of both capital and labour, because the employer's theory of \" hire and fire \" offered relentless resistence to the workmen's claim to form unions and to resort to strikes for trade union purposes. In v. ) Mr. Justice , in his dissenting judgment, has given a, very illuminating account of the history and progress of the trade union movement in the United States, in England and the Colonies. \" Practically every change in the law \", observed Mr. Justice , \" governing the relation of the employer and the employees must abridge in some respect the liberty or property of one of the parties, if liberty and property is measured by the standard of the law theretofore prevailing. If such changes are made by acts of the we call the modification an exercise of the police power, and although the change may involve an interference with existing liberty or property of individuals, the statue will not be declared a violation of the due process clause unless the court finds that interference is arbitrary or unreasonable, or that, considered as a means, the measure has no real or substantial relation of cause to a permissible end\". ", "(1) 306 U.S. 238; 83 Law. Ed. 627. ", "(2) 66 Law. Edn. 311 ; 257 U.S. 254. ", "107 ", "846 ", "In that case the validity of the prohibition of , cl. 1464 against the interference ,.by injunction between employers and employees in cases growing out of a dispute concerning terms or conditions of employment was challenged; and the challenge was upheld by a majority of the learned -judges who took the view that the said provision was contrary to the 14th Amendment of the Constitution. , , ., however, dissented. The main decision in that case is not of direct assistance in the present appeals. No doubt Mr. has attempted to contend that the acts of which the strikers were held guilty in that case are similar to the acts alleged against the employees in the present appeals; but this argument would be relevant only if it is shown by the that the specific subversive acts alleged have been committed by the specific individual employees. To that point we will refer later on. Incidentally the present decision is of some importance because the dissenting opinion delivered by Mr. Justice has been subsequently treated as an authoritative exposition of the problem of trade unionism and the history of its growth and development. ", "Fortunately, as the Indian Trade Unions Act 1926, , the Industrial Employment (Standing Orders) Act 1946 , and the Industrial Disputes Act 1947 show, our has very wisely benefitted by the experiences of other countries in the matter of the development of trade union movement, and has made progressive, just and fair provisions governing the important problem of industrial relationships, the formation of trade unions, and the settlement of industrial disputes, It can be justly claimed that though we have witnessed capital-labour conflicts in our country, on the whole neither party has departed from the pursuit of peaceful methods, and both parties submit their disputes to be resolved in accordance with the provisions of the Act. In dealing with industrial disputes like the present, we must, therefore, primarily consider the relevant statutory provisions and the material Indian decisions, Thus considered the conclusion is inevitable that the pen- down strike is a strike within s. 2(q) and so per se it cannot be treated as illegal; it has been found to be illegal in this case because it was commenced in contravention of s. 23(b) of the Act; but, as has been held by this Court in (1) mere participation in such an illegal strike cannot necessarily involve the rejection of the striker's claim for reinstatement. As we have already indicated, on the findings of the appellate tribunal nothing more than such participation has been proved against the employees whose reinstatement has been ordered; and so, unless the said finding is reversed, the first contention raised by the must fail. ", "It has been strenuously urged before us that in the case of a which is a credit institution a pen-down strike, if continued for a long period, is likely to affect prejudicially the credit of the . It is also pointed out that, even in regard to industrial concerns, if strikers entered the premises of the factory and sit around the plant in large numbers, in the heat of the moment unfortunate and ugly incidents are likely to happen, and so such pen-down or sit-down strikes should be positively discouraged. We are prepared to concede that in the surcharged atmosphere which generally accompanies strikes and when passions are aroused, a large scale and continuous pen-down strike may lead to untoward consequences. But, on the other hand, even in the case of such a strike, the employer is not without a remedy. He may bar the entry of the strikers within the premises by adopting effective and legitimate methods in that behalf as in fact the did in the present case from April 23. He may call upon the employees to vacate, and, on their refusal to do so, take due steps to suspend them from employment, proceed to hold proper enquires according to the standing orders, and pass proper orders against them subject to the relevant provisions of the Act. If the had been properly advised to adopt such a course, many of the difficulties which it had to face in the present proceedings would not (1) A.I.R. 1959 S.C. 529. ", "848 ", "probably have arisen. Therefore, we do not think that the general hypothetical consideration that pendown strikes may in some cases lead to rowdy demonstrations or result in disturbances or violence or shake the credit of the would justify the conclusion that even if the strikers are peaceful and non-violent and have done nothing more than occupying their seats during office hours, their participation in the strike would by itself disqualify them from claiming reinstatement. ", "Let us then consider the second contention raised by the . It is urged on behalf of the that it is really unnecessary to examine which particular employee was directly associated with the preparation and circulation of the subversive circular or posters. The offensive posters and circulars had been drafted, printed and circulated in pursuance of the common object of the strikers, and each one of them must, therefore, share the responsibility for the said act. It is really an argument based on the theory of conspiracy which makes all conspirators liable for the act of any one of them. ", "This argument is countered by the employees with the contention that the activities of the do not fall to be considered in the present enquiry. It is the acts of individual strikers who have been dismissed that have given rise to the dispute and the enquiry must be confined to that dispute alone. The learned Attorney-General seriously asked us to bear in mind that the application of the doctrine of conspiracy to the decision of the present dispute may have far-reaching consequences on the future of the trade union movement itself, and he suggested that since the and its activities were not the subject matter of the present enquiry we need not consider the argument of conspiracy at all. Besides, according to him, if the theory of conspiracy was upheld it would mean that if any office bearers of the were guilty of any subversive acts the whole membership of the would be constructively responsible and that is plainly unreasonable. In this connection he also referred us to ss. 17 , 18 and 19 of the Indian Trade s Act 1926 (16 of 1926). We have indicated this argument at this place by anticipation. In fact this argument has been raised by the employees in their appeal but we thought it would be convenient to deal with both these aspects of the matter in one place. ", "Now the answer to both these technical and academic contentions is the same. In industrial adjudication tribunals should be slow to adopt any doctrinaire or legalistic approach. They should as far as is reasonably possible avoid the temptation of formulating general principles and laying down general rules which purport to cover all cases. Let us recall the nature of the enquiry which the appellate tribunal had directed as a result of its interlocutary judgment. This enquiry is confined to the question as to whether in' regard to the case of each one of the dismissed employees, the has shown any positive circumstances as a result of which reinstatement, which is the normal rule, should not be directed. Thus considered we do not think it necessary to deal with the academic points raised by both the parties before us. ", "The third argument urged by the bank is in regard to the finding of the tribunal that only 14 employees named by it are responsible for the subversive posters and hand bills. It is urged that this finding is perverse. We are not impressed by this argument. There is no doubt that the three posters Exs. 255 (a), 255 (c) and 302, to which strong exception has been taken by the are subversive of the credit of the . They make imputations about the honesty of the management of the and in terms suggest improper use of the funds of the for personal purposes. It is also true that a large number of other documents issued by the before and during the strike have used exaggerated, and unduly militant intemperate, language, and in our opinion the appellate tribunal was justified in expressing its disapproval of the use of such language; but the appellate tribunal thought that none of these documents could really be taken to be subversive of the credit of the and with that conclusion we are in full agreement. Therefore the only question which we have to consider is whether the view taken by the appellate tribunal that 14 persons were actively concerned with these offensive documents can be successfully challenged by the before us. In making its finding on this point the appellate tribunal has substantially relied on the statement made by . He was asked whether the drafts of the letters issued by him had been approved at the meeting of the working committee or on his individual responsibility and he replied that they were never written on individual responsibility but were based on consultation with the members of the working committee. Then he was asked whether he could name the persons whom he consulted in drafting the poster dated July 5, 1949 (Ex. 222). In reply to this he enumerated the names of 9 persons and added the word \" so on.\" It appears that the appellate tribunal asked him several questions on the same topic and the effect of his admissions clearly was to show that most of the documents were issued by the secretary or the president after he had consulted the persons named by . In this connection gave the names of the office bearers of at Delhi. It was in the light of these admissions that the appellate tribunal came to the conclusion that 14 persons named by him can be safely taken to have been actively associated with the drafting and the publication of the subversive documents. ", "Mr. contends that the list of office bearers separately supplied by includes a much larger number of active workers of the and on the evidence of all these active workers should have been held responsible for the said documents. In this connection he has relied on the affidavit filed by on behalf of the . We do not think that this argument is wellfounded. It is significant that though the appellate tribunal had directed the by its interlocutary judgment to file a statement giving particulars of the acts alleged against each one of the employees no such statement -was filed. Besides it is fairly conceded before us by Mr. that most of the employees who made affidavits in the subsequent enquiry were not asked any general question about their alleged subversive activities and no particular question was put to them in regard to the relevant subversive documents. The judgment of the appellate tribunal shows that it first considered the general points and the evidence relied upon by the parties in that behalf; and then it exhaustively dealt with the whole of the evidence bearing on the case of each individual employees. We are satisfied that the is not justified in contending that in excluding 136 employees from the responsibility of direct participation in the drafting and publication of the subversive circulars and hand-bills the appellate tribunal has ignored any important evidence. The argument that the said finding is opposed to the weight of evidence and as such perverse must therefore be rejected. ", "Then Mr. has invited us to consider some individual cases. According to him the case against had not been properly considered by the appellate tribunal. It does appear that admitted that he had taken part in the drafting of documents P. 272, 274, 279, 280 and 286; but none of these documents has been found to be subversive and so it is idle to contend that 's connection with any of the three subversive documents is established. So there is no substance in the argument that 's case should be reconsidered. ", "Then our attention has been drawn to the cases of five other employees , , , and .' In regard to these persons the appellate tribunal has found that the had failed to -prove any subversive acts against them, and that undoubtedly is a question of fact and the finding of the appellate tribunal cannot be reopened. But Mr. has attempted to challenge the correctness of this finding on the ground that it is entirely inconsistent with one material document on the record. This document is the report made by on April 24 in which the incidents that took place on April 23 and 24 have been set out and the names of persons who took prominent part in the said incidents have been enumerated. This list includes the names of the five persons in question. had, however, died at the date of the enquiry and so he could not give evidence. , who was then the Superintendent of Police, proved this report. Mr. 's grievance 'is that though the evidence of had been accepted by the appellate tribunal in a part of its judgment it has failed to consider his testimony in dealing with the cases of these five persons. In our opinion this argument is entirely misconceived. It is not correct to say that the appellate tribunal has accepted the whole of 's evidence in any part of its judgment; while dealing with the question about the conduct of the crowd the appellate tribunal considered the evidence of , , and and held that part of their evidence which was corroborated by and also partially by must be believed; that is all. Besides, the evidence of itself does not carry the 's case any further against the five persons. No doubt, while proving the report of , first stated that the facts narrated therein were correct; but in crossexamination when he was asked about some details mentioned in the report he added that the report was written by and he could not say anything about it. Further he also admitted that during the course of his visit and stay at the when the strike was going on he only knew three persons who took part in the activity which was described by in his reports Thus the evidence of does not show that he clearly knew any of the five employees and the same comment obviously falls to be made about himself who made the report. Therefore it is not accurate to say that the conclusion of the appellate tribunal in regard to these, five cases suffers from any infirmity on which it can be successfully challenged before us; besides the apparently relied upon other evidence against these five persons, and not the report of , and that evidence has been disbelieved, Mr. has then urged that in directing reinstatement of 136 employees the appellate tribunal failed to consider the fact that in the meanwhile the has employed additional hands and it would be unfair to the to direct that these dismissed employees should be taken back. The reinstatement order would lead to complications and the may have to face the claims of those who have been employed in the meanwhile. Mr. wanted to prove that the had employed a large number of hands in the meanwhile by referring to the statement made by the in the bulletin and posters issued during the strike. These statements seem to indicate that the complained that pending the strike the was employing new hands. But if the wanted to urge this plea seriously it should have proved the relevant facts, e.g., how many employees have been appointed and on what terms. These are matters within the special knowledge of the and they could have been proved very easily. The did not choose to prove these facts. Indeed it does not appear that this plea was urged as a separate plea against the order of reinstatement before the appellate tribunal. In any case, in the absence of satisfactory materials it would be difficult to deal with this plea on the merits. Besides, if the has failed to establish its specific case against any of the 136 employees, there is no reason why the normal rule should not prevail and the employees should not get the relief of reinstatement. The mere fact that the may have employed some other persons in the meanwhile would not necessarily defeat such a claim for reinstatement. As has been held by this Court in v. The Workmen (1), however much the court may sympathise with the employer's difficulty caused by the fact that after the wrongful dismissals in question he had engaged fresh hands, the court cannot \" overlook the claims of the employees who, on the findings of the tribunals below, had been wrongly dismissed. \" In the case of such wrongful (1)Civil Appeal No. 312 of 1956- Decided by this Court on January 22, 1957. ", "108 ", "854 ", "dismissal the normal rule would be that the employees thus wrongfully dismissed must be reinstated. \" The hardship in question \", observed this , \" has been brought about by the precipitate action of the appellants themselves who dismissed their workmen without holding the usual enquiries after framing a proper charge against them. If they had proceeded in the usual way and given a full and fair opportunity to the workmen to place their case before the enquiring authority, the result may not have been so bard. \" These observations are equally applicable to the conduct of the in the present appeals. ", "The last argument urged by Mr. is that a large number of employees who are clamouring for reinstatement have secured employment on a fairly permanent basis and so it is unnecessary that they should be forced on the . This argument cannot be entertained because it has not been urged before the appellate tribunal, and though it was sought to be raised before us, Mr. fairly conceded that in the absence of any material it would not be possible for him to press this point. Indeed it is the first two general points which were seriously pressed before us by Mr. and Mr. on behalf of the . Mr. no doubt raised three additional subsidiary points in Civil Appeal No. 519 of 1958, in which he appeared, but as we have pointed out there is no substance in any one of them. In Civil Appeal No. 520 of 1958, in which Mr. appeared for the he did not challenge the findings recorded by the appellate tribunal in respect of the 10 employees concerned in the said appeal. In the result both the appeals preferred by the fail and are dismissed with costs. That takes us to Civil Appeal No. 521 of 1958, filed by the employees. In this appeal we are concerned with the order refusing reinstatement to 14 employees. In addition to the two preliminary objections which we have already considered the learned Attorney-General raised two general points for the appellant. The first is that the appellate tribunal has erred in law in virtually penalising the 14 employees for the activities of the , and in that connection the raised the"], "relevant_candidates": ["0000166975", "0000546415", "0000712681", "0000916043", "0001109872", "0001124131", "0001266121", "0001599768", "0001781027", "0001919374", "0001967135"]} {"id": "0001396306", "text": ["PETITIONER: & ORS. Vs. RESPONDENT: UNION OF INDIA & ORS. DATE OF JUDGMENT: 22/08/2000 BENCH: D.P.Mohapatro, , JUDGMENT: ", "PATTANAIK,J. ", "These writ petitions filed under Article 32 of the Constitution by the officers of , some by the promotees and others by direct recruits, in-fact, raise the question as to whether in determining inter-se seniority between the promotees and the direct recruits, the guidelines and directions given by this in the case of vs. , reported in 1985(1) SCR 351, have been duly followed or not? It is rather unfortunate that on an erroneous impression that the judgment in case is under consideration before , these writ petitions were directed to be placed before , resulting thereby inordinate delay in disposal of the matters, which in turn, must have adversely affected the career of several persons. At the beginning of the hearing of these writ petitions, on being asked, the counsel appearing for all the parties, could not indicate any decision where the correctness of judgment of this in case was under consideration, though in one of these writ petitions filed by a direct recruit, namely Writ Petition No. 1252/90, Mr. , the learned senior counsel for the petitioner, challenged the correctness of decision of this in case to which, we will advert at the appropriate time. Suffice it to say for the present that , who was also a promotee to the , filed the writ petition, claiming that since they have been working as Additional District and Session Judges, against temporary posts created by in the cadre of Additional District & Sessions Judge, they should be treated as Members of and the seniority should be decided on the basis of continuous length of service. The three Judge Bench, which heard the case delivered two judgments, Chief Justice as he then was, speaking for himself & on behalf of Justice and Justice , giving a separate judgment. Chief Justice in the majority judgment also indicated that the conclusion which the majority has arrived at, is not different from the one, reached by Justice , but because of the general importance of the case and because of disagreement on the interpretation of one of the provisions of the Recruitment Rules, it was thought fit that the separate judgment should be written. The disagreement between the two judgments was on the question as to whether the Recruitment Rules, provided for any quota in the and whether the principle of quota and rota was required to be followed for determining the inter-se seniority. Interpreting the proviso to Rule 7 of the Rules, Jusitce came to the conclusion that Rule 7 only provides for ceiling of direct recruits by providing that in case, there were recruitment from the as well as by promotion, in such a case, recruits would not be more than one third of the substantive posts in the service and there is no quota as such. Justice was of the view that Rule 8(2) proceeds on the mis-conception that there is quota fixed for direct recruits, which Rule 7 does not and Rule 8(2) cannot on plain literal meaning also be construed or interpreted to mean that it was deemed by the legislature and the rule-making body to engraft any quota. Chief Justice , on the other hand, speaking for himself as well as on behalf of Justice , on a construction of Rule 7 and Rule 8(2), came to hold that the proviso to Rule 7 has to be read along with Rule 8(2), since the two provisions are inter- related and their combined reading yields but one result, that the proviso prescribes a quota of one third for direct recruits. It was also held that Rule 8(2) cannot be held to be unconstitutional, merely because it reserves one third of the vacancies in the service for direct recruits and provides that the first available vacancy in the service will be filled in by a direct recruit, the next two by promotees and so on. In the majority judgment, Their Lordships also came to the conclusion that though the proviso to Rule 7 prescribes a quota of one third for direct recruits and provides for rotation of vacancies between them and the promotees, who are appointed to the service, that rule must inevitably break down when appointments to promotees are made to the Service under Rules 16 and 17. Having interpreted the provisions of Rules 7 & 8 of the Recruitment Rules, as aforesaid, their Lordships examined the different provisions of the Recruitment Rules and recorded their findings, which would be appropriate for us to enumerate for resolving the controversy in these writ petitions. On going through the detailed charts, which were filed by the promotees in case, the came to the conclusion: ", "These charts show, indisputably, that promotees who have been functioning as temporary Additional District and Sessions Judges for an unbroken period between 8 to 12 years are regarded as juniors to the direct recruits who have been appointed as Additional District and Sessions Judges much later. ", "The further held: ", "The process of reading the Rules as parts of a connected whole does not end with Rules 7 and 8. Rules 16 and 17 are also relevant for the present purpose and have, indeed, an important bearing on the question of reservation of vacancies for direct recruits to the extent of one-third of the substantive posts in the Service. ", "Adverting to Rules 16 and 17 it was held: ", "The position which emerges from the provisions contained in Rules 16 and 17 is that it is permissible to create temporary posts in the Service and, even substantive vacancies in the Service can be filled by making temporary appointments. ", "Interpreting Rules 2(b) and 2(d), it was held that according to the scheme of the Rules in this case, is a narrower body than the cadre. In interpreting Rules 2(b) and 2(d), Their Lordships held that by the definition contained in Rule 2(d), membership of the is limited to persons, who are appointed in a substantive capacity to the , but by reading the second part of Rule 2(b) in an extended sense, every temporary post which carries the same designation as that of any of the posts specified in the Schedule is a Cadre Post, whether such post is comprised in the or not. Such posts and the posts specified in the Schedule will together constitute the Cadre under Rule 2(b), if an extended meaning is given to the second part of the rule. Having given such meaning to the provisions of Rules 2(b), 2(d), 7, 8, 16 and 17, the proceeds to determine the question of seniority between direct recruits and promotees. It was then observed: ", "Care has, therefore, to be taken to apply the provisions of Rule 8(2) in such a manner as not to lead to the violation of the guarantee of equality and equal opportunity contained in Articles 14 and 16 of the Constitution. For that purpose, it is necessary to ascertain as to which of the promotees can be regarded as belonging to the same class as the direct recruits. ", "In its pursuit to ascertain as to which of the promotees can be regarded as belonging to the same class as direct recruits, the observed: that in the matter of seniority, it is difficult to appreciate, how any distinction can be made between direct recruits who are appointed to substantive vacancies in the on the recommendation of the High under Rule 5(2) and the promotees, who are appointed in consultation with the High to posts in the under Rules 16 and 17. ", "While coming to the aforesaid conclusion, it was also indicated that the persons belonging to , who are appointed to temporary posts of Additional District and Sessions Judges on an ad hoc basis or for fortuitous reasons or by way of a stop-gap arrangement, constitute a class which is separate and distinct from those who are appointed to posts in the Service in strict conformity with the rules of recruitment. The , then noted a representative order of appointment under Rule 16 and held that such appointments were neither ad hoc, nor fortuitous, nor in the nature of a stop-gap arrangement and persons promoted under such orders have been factually officiating continuously without a break as Additional District and Sessions Judges for a long number of years. Their Lordships noticed the difficulties in evolving a rule, which will cause no hardship of any kind to any member of the Service and yet attempted to minimise the same as far as possible, so that inequities and disparities which are inherent in a system which provides for recruitment to the Service from more than one source. It would be appropriate to extract the following observations made by Their Lordships in the majority judgment: ", "It may bear emphasis that promotees appointed under Rules 16 and 17 to can rank for seniority along with direct recruits only if they are appointed in consultation with as required by those Rules and if they satisfy the requirement laid down in Rule 7(a) that they must have completed not less than ten years of service in .\" ", "The best solution to the situation that confronted the in case was to adopt the rule enunciated in vs. State of Maharashtra, 1977 (3) SCR 775, to have continuous officiation in a non- fortuitous vacancy ought to receive due recognition in fixing seniority between persons who are recruited from different sources, so long as they belong to the same cadre, discharge similar functions and bear the same responsibilities. It was also held that since rule of quota and rota ceases to apply when appointments are made under Rules 16 and 17, the seniority of direct recruits and promotees appointed under those Rules must be determined according to the dates on which direct recruits were appointed to their respective posts and the dates from which the promotees have been officiating continuously either in temporary posts created in the Service or in substantive vacancies to which they were appointed in a temporary capacity. Justice in the separate judgment also came to the same conclusion for determining the inter-se seniority between the promotees and direct recruits. It may be noticed that the ultimately quashed the seniority list which had been prepared by the High and observed that a new seniority list be prepared on the basis of the view taken in the judgment and the said new seniority list would include the direct recruits and promotees appointed under Rules 16 and ", "17. While quashing the seniority list, the seniority of Shri was protected, since he had been appointed as Additional and Sessions Judge in a vacancy reserved for the members of Scheduled Caste. ", "Subsequent to the judgment of this Court in Singla, redrew up a seniority list on 26th of March, 1985 and in drawing up the said list, the principle that was evolved is the subject matter of challenge in the writ petitions filed by the promotees. It may be stated that a fresh look was also given to the earlier seniority list that had been prepared on 26th of March, 1985 and submitted the report on 5th of March, 1986, which was approved by in its Meeting on 25th of October, 1986 and the final seniority list thus emanated on 11th of November, 1986. According to the promotee officers, while preparing the final seniority list, has not followed the directions given by this Court in case and erroneously did not take into consideration the continuous appointment of the officers as Additional District and Sessions Judge, notwithstanding the fact that the appointments had been made after due consultation with and the appointees fulfilled the requirements of Rule 7(1) of the Recruitment Rules, on an erroneous conclusion that the appointment was ad hoc or fortuitous or stop-gap. A representation appears to have been filed by the promotees in 1987 and then the present writ petition was filed which was registered as Writ Petition No. 490/87. ", "At the outset, it may be stated that the Delhi Higher Judicial Service Rules 1970 were amended in the year 1987 by Notification dated 17th of March, 1987, subsequent to and pursuant to the observations made by this in case and by virtue of explanation added to Rules 16 and 17, Rules 5 and 7 to 11 became applicable to such appointments also. We are not concerned in this batch of cases with the effect of such amended provisions or the inter-se seniority to be determined subsequent to the year 1987, though we are told that a fresh seniority list has been prepared in March, 1995 and the Full of Delhi High has taken a decision thereof in the year 1998. For the present, we are only concerned with the question whether in preparing the seniority list of the officers recruited to from both the sources viz. as direct recruits as well as by promotion, prior to the amendment of 1987, the directions and conclusions of this in case has been duly given effect to. ", "Mr. , the learned senior counsel, appearing for the petitioners in Writ Petition No. 490/87, who are the promotees, contended that even though the recruitment to of these petitioners have been made either under Rule 16 or under Rule 17 of the Recruitment Rules after due consultation and / or approval of and the incumbents were duly qualified for being promoted under Rule 7 of the Recruitment Rules and had continuously held the posts of Additional , yet erroneously was of the opinion that they are ad hoc or fortuitous or stop- gap appointees and, therefore they were made junior to the direct recruits and the continuous length of service was not taken into account for the purpose of determination of the inter-se seniority. According to Mr. , there was no ambiguity in the judgment of this in case, but since the had not indicated as to when an appointment can be said to be ad hoc or fortuitous or stop-gap arrangement, went on examining the number of posts that were available on 22.4.1980, the date on which Smt. was directly appointed and then after giving her the 30th position in the seniority list, the promotees seniority were adjusted and all other promotees who even though have been recruited under Rules 16 or 17 after due consultation with and also satisfied the qualification required under Rule 7 and had continuously held the post of Additional , much prior to Smt. , yet such appointments of the promotees was held to be ad hoc or fortuitous and by adopting such procedure, acted contrary to the judgment and directions of this in case. According to Mr. , it is only when an appointment is made to of a person, belonging to without due consultation or approval of or when such appointee did not have the prescribed qualification under Rule 7 for being promoted or any short term appointment is made in exigency of any particular situation, requiring immediate recruitment or an appointment is made purely by way of stop-gap arrangement, which can obviously be for a very short period, then only the appointment can be held to be on ad hoc basis or for fortuitous reasons or by way of a stop-gap arrangement and in such a contingency, the Services rendered by an appointee cannot be counted for the purpose of seniority in . But when the appointment is made by the Administrator either under Rule 16 or Rule 17, after due consultation with or getting the approval of and the appointee satisfies the qualification required under Rule 7 and continuously holds the post of Additional for a fairly long period, as in the case in hand, it is difficult to import the concept of ad hoc or fortuitous or stop-gap, which is well known in the Service Jurisprudence to such appointments. In this view of the matter, committed serious error in coming to the conclusion that the appointment of the petitioners was ad hoc/fortuitous/stop-gap and consequently, the seniority list thus prepared is contrary to the directions given by this in case. The second , which examined the objections filed to the provisional list, approved by the Full of Delhi High in its Meeting held on 15th of May, 1985 also committed the same mistake as the earlier and went on examining the question of lien under the fundamental rules, and as to how many of the incumbents of were on deputation to different posts for the purpose of finding out as to whether the appointments made in that chain would be ad hoc or fortuitous or stop-gap. According to Mr. , the second , even went to the extent of holding that if a quota post meant for direct recruit according to the quota, remains unfilled, then the promotee occupying the last post must be taken to be holding the post on ad hoc basis or for fortuitous reasons or by way of stop-gap arrangement and the promotee holding the last post must be made to surrender it, and applying this theory one Shri , who had worked for about four years as Additional District & Sessions Judge was made junior to Smt. but according to the that was the best solution, and, therefore, the provisional seniority list already approved by the Full was recommended to be accepted as the final list. From the final seniority list, it transpires that Shri had been appointed as Additional on 27.7.76, whereas Smt. was appointed as Additional as a direct recruit on 22.4.1980, but yet she was shown senior to . Mr. also pointed out that even the officers who had been appointed in December, 1980 and had been continuing as Additional District & Sessions Judge, yet their appointments were held to be fortuitous as three posts for direct recruitment had been advertised. According to Mr. , of Delhi had failed to implement the positive mandate of this in case and the spirit of the same in drawing up the seniority list and gross injustice has been meted out to the promotee officers. The learned counsel points out that Shri , Shri , Shri O.P.Dwivedi, Shri R.C.Jain and Shri J.D.Kapoor though had been duly appointed in the year 1980 under Rules 16 and 17 and had continuously held the post of Additional , they were shown junior to Shri B.S.Chaudhary, a direct recruit, who was appointed on 10.11.1982. Similarly, Shri B.N.Chaturvedi and Shri , though had been appointed as Additional in August, 1984 under Rule 16, after due consultation with of Delhi and also were duly qualified under Rule 7 and continuously held the post of Additional , yet they were made junior to the direct recruits of the year 1985 namely Ms. , and . This determination of inter-se seniority, according to Mr. is in contravention of the principles evolved by this in case and, therefore, such seniority list cannot be sustained. Mr. also pointed out that even though, this in O.P. case categorically held that the controversy regarding the fixation of the seniority list between the promotees and direct recruits cannot be resolved following the earlier decision in the case of , yet while drawing up the seniority list, followed the principle of . According to Mr. , there cannot be a more blatant contravention of the directions given by this in case than the one committed by in the case in hand. ", "Mr. , the learned senior counsel, appearing for the petitioners in Writ Petition No. 1252/90, on the other hand contended with force that since there cannot be any appointment more than the number of posts available in the and this Court having indicated that stop-gap/fortuitous/ad hoc appointments will not enure to the benefit of such appointees for the purpose of their seniority, it was incumbent on to identify the posts available in the for being regularly filled up and any appointments made in excess of the posts available must be held to be either stop-gap or fortuitous or ad hoc and, consequently, the High court did not commit any illegality in drawing up the seniority list. Mr. also contended that the Member of the having been defined in Rule 2(d) to mean a person, appointed in a substantive capacity to the under the provisions of the Rules, and Rule 16 having provided for creation of temporary posts in the by the Administrator and filling up of the same, such appointments cannot be held to be appointments in the in substantive capacity and such appointees cannot be held to be Members of the within the meaning of Rule 2(d) and on this ground, the Judgment in ' case requires re- consideration. ", "Mr. , the learned senior counsel, appearing for the direct recruits, seriously contended that the judgment of this in 's case is contrary to the law laid down by this in & Ors. , 1970(2) S.C.R., 666 , and, therefore, the said judgment must be reconsidered. He also contended that the statutory rules having provided for a quota for the direct recruits, as apparent from a combined reading of Rules 7 and 8, if no such quota is fixed for the direct recruits in case of appointments made under Rules 16 and 17, then the rule will be grossly discriminatory and would be liable to be struck down and, therefore, until such quota is provided in respect of appointments made under Rules 16 and 17, it would only be meet and proper to hold that the seniority must be determined in accordance with Rule 8(2), which would necessarily mean that the appointees under Rules 16 and 17 cannot claim parity with regular appointees under Rule 7 and, therefore, cannot claim seniority in the Cadre. The learned counsel also contended that the decision in case being one, in relation to the very Service, the principles evolved therein must be made applicable and, High , therefore, rightly relied upon the same in determining the inter-se seniority. According to Mr. , only the genuine appointees under Rules 16 and 17 may, at best, get the benefit of the decision of this in s case and appointment made against temporary post, because the temporary appointee has gone elsewhere, cannot be held to be an appointment under Rule 16, even though, he might have been nomenclatured as such. ", "Mr. , the learned senior counsel, appearing for the respondents in Writ Petition No. 490/87, fairly stated that this Court having not indicated the true import and meaning of the expression stop- gap/fortuitous/ad hoc , had to give meaning to the same and in so doing, has taken into account the number of posts available in the Service and has tried to implement the directions given by this Court in case. According to Mr. , this Court should now indicate or clarify the meaning of the expression stop-gap/fortuitous/ad hoc in which event, there will not be any further controversy in implementing the directions of this Court for drawing up the seniority list. ", "Mr. also appearing for respondent No. 8 in Writ Petition No. 490/87, who happens to be a direct recruit, contended that in case, this has tried to work out the equity and for working out equity, it will not be appropriate to take into account the Services rendered by an appointee against a temporary post when the original appointee against the said temporary post is on deputation to some other Service. According to Mr. , by not following the quota, meant for direct recruits, gross inequity has already been met out to such direct recruits and over and above that, if the continuous service of such an appointee under Rule 16, as stated above is taken into account for determination of their seniority, then the aspiration with which a Member of the joins the post in will be marred and it will work out gross inequity, so far as the direct recruit is concerned. ", ", respondent no. 9 in Writ Petition No. 490/87, who is also a direct recruit, argued in- person and reiterated the stand taken by Mr. , appearing for some of the direct recruits and Mr. , appearing for . Mr. , a promotee, also appeared in-person and adopted the stand taken by Mr. . ", "Mr. , the learned senior counsel, appearing for , on the other hand contended that prior to the judgment in case, the understanding of the rule was that appointments made under Rules 16 and 17 will not count for the purpose of seniority and inter-se seniority has to be determined only between direct recruits and promotees made under Rule 7, following the principle engrafted in Rule 8(2). But after the judgment in case, when the Court was confronted with a situation that there has been more number of appointments than the posts available and even in case, this Court had indicated that the fortuitous, ad hoc and stop-gap appointees, cannot claim their seniority, took the decision that all appointments made beyond the number of posts available, must assume the character of fortuitous, ad hoc or stop-gap, and, therefore, cannot claim seniority in the Cadre. According to Mr. , though in case, the Court has not indicated the meaning of the expression ad hoc, fortuitous or stop-gap but those expressions have been given due meaning in , 1958 SCR, 828, and, therefore, those meanings should be imported and given effect to. According to Mr. , even though, the appointment letters might have indicated the appointments to be one under Rules 16 or 17, but that by itself will not create any right in favour of the appointees on the basis of the judgment inasmuch as a wrong leveling will not create a right as such. In support of this contention Mr. , relied upon decisions of this Court in the case of , 1964(4) SCR 991 , and , Assistant Collector of Bombay & Ors. Vs. ., 1971(3) SCR, 506. Mr with reference to the seniority list, which had been drawn up, contended that when the appointments have been shown to be out of turn such appointment must be held to be fortuitous within the meaning of the said expression used in 's case and, therefore, such appointees cannot claim a parity or equality with the regular appointees under Rule 7 and, therefore, cannot claim their seniority on the basis of mere continuous length of Service, as contended by Mr. , appearing for the promotees. ", "Having examined the rival submissions at the and having scrutinized the two seniority lists drawn up by , the provisional as well as the final, the provisional made on 26th of March, 1985 and the final list which was approved by on 25th of October, 1986, we find sufficient force in the contentions made by Mr. , appearing for the promotees. We are also of the considered opinion that , in drawing up the seniority list, though proceeded to allocate seniority according to the length of continuous officiation, regardless of whether an appointee held a temporary post or a permanent post or whether he was a promotee or a direct recruit, as directed by this in case, but committed error by excluding the persons, on the ground that they held posts on ad hoc basis or for fortuitous reasons or by way of stop-gap arrangement, even though appointments had been made under Rules 16 and 17 after due consultation with and or approval of the High and the appointees satisfied the qualification required under Rule 7 of the Rules. It is on this score, the ultimate seniority list, drawn up, stands vitiated. When the report of the first , on the basis of which ultimately provisional seniority list was drawn up is examined, it would appear that the went on examining the question of a lien against a post and then, recorded a finding that anyone who comes to hold one of those posts, which is subject to a lien, must be held to be holding as an ad hoc arrangement or for fortuitous reasons or as a stop-gap arrangement. The also recorded a further finding that if the position of the person, whose seniority is under consideration is beyond the total number of posts in the , then also his appointment must necessarily fall within the description of ad hoc/fortuitous/stop-gap and having said so, the assigned Ms. , the 30th post and then adjusted the seniority accordingly. The conclusion of the that a person, promoted to the Higher Judicial under Rules 16 or 17 of the Rules to a post against which some other person has a lien, would ipso facto make such appointment ad hoc/fortuitous/stop-gap, is contrary to the conclusion of this in case. Then again, this having categorically directed in case, that appointments made under Rule16 or 17, after due consultation and/or approval of the High , and the appointee did qualify to hold the promotional post, as required under Rule 7 of the Recruitment Rules, then such appointment of the appointee will not be ignored for the purpose of determining the inter-se seniority in the cadre and on the other hand, continuous length of should be the basis, though Rule 8(2) of the Rules provides otherwise. Yet the High took shelter under the expression ad hoc/fortuitous/stop- gap and ignored the continuous length of of such appointees, while determining the inter-se seniority. In fact, in case, the on being confronted with a peculiar situation, had given the direction as to in what way, it will be equitable for all concerned to determine the inter-se seniority, but notwithstanding the same, the High appears to have stuck to the idea of the principles engrafted in Rule 8(2) of the Rules and then decided the question of seniority on the basis of number of posts, available in the . While doing so, the High obviously missed the findings of this that under the scheme of the Rules, is a narrower body than the cadre and every temporary post, which carries the same designation as that of any of the posts in the schedule is a cadre post, whether such post is comprised in the or not. It is also apparent from the report that the High followed case in drawing up the seniority, on the ground that the judgment (in case) does not indicate whether the earlier decision of the High in case is still to be followed in preparing the seniority list or not, but obviously, the High has failed to appreciate, what was stated in the concurrent judgment of , in case, wherein in no uncertain terms, it was stated that so far as, controversy regarding the fixation of the seniority list between the promotees and direct recruits, the same will not be guided by case inasmuch as in case, the construed the Delhi Judicial Rules, 1970 in the context of seniority and confirmation and not in the context of inter-se seniority between the promotees and direct recruits. The entire reasoning given by the High in the first report, on the basis of which, provisional seniority list has been drawn up, cannot, but be held to be contrary to the directions given by this in case, and accordingly, must be held to be erroneous. The reasoning of the High , in fact, nullifies the ratio in 's case, wherein , had observed, after noticing a representative order of appointment under Rule 16:- ", "The appointments were neither ad hoc, nor fortuitous, nor in the nature of a stop-gap arrangement. Indeed, no further orders have ever been passed recalling the four promotees and, others similarly situated, to their original posts in the subordinate . Promotees who were under Rule 16 have been officiating continuously, without a break, as Additional District and Sessions Judges for a long number of years. It is both unrealistic and unjust to treat them as aliens to the merely because the authorities did not take up to the necessity of converting the temporary posts into permanent ones, even after some of the promotees had worked in those posts from five to twelve years.\" ", "Yet, in drawing up the seniority list, have treated such promotees, who are appointed under Rule 16 as aliens to the Service and thus, was wholly in error in preparing the provisional seniority list, as already stated. If we examine the second report, which had considered the objections filed by the promotees and ultimately, on the basis of which the final seniority list was approved by in its Meeting on 25th of October, 1986 and the list was prepared on 11th of November, 1986, we also find, committed similar error in accepting the provisional seniority list as final. In the second Report, the , again was of the view that if a post meant for a direct recruit, according to the quota, remains unfilled, then the promotee occupying the last post, must be taken to be holding that post on ad hoc basis or for fortuitous reasons or by way of a stop-gap arrangement. This indicates that the was still obsessed with the provisions of Rule 8(2) of the Recruitment Rules, even though in case, it has been categorically held by this Court that quota principle has broken down and as such, seniority cannot be determined by taking recourse to the quota and rota provided under Rule 8(2) but on the basis of continuous length of Service, provided the promotees have been promoted after due consultation with and/or approval of under Rule 16 or 17 and they did possess the requisite qualification for promotion, as provided under Rule 7. At this stage, it would be appropriate to notice the letter of appointment of Shri , Shri , Shri and Shri by the order of the Administrator dated 19th of December, 1980, which is identical with the representative order, this Court had taken note of, in case. It is not the case of or any of the direct recruits-respondents that these promotees, on being promoted on 19th of December, 1980, have at any point of time, reverted to their substantive post before was appointed as a direct recruit on 10.11.1982. In this view of the matter, these promotees, who are appointed under Rule 16(2) of the Recruitment Rules on 19.12.1980, and continuously held the said post and further, such appointments have been made in consultation with of Delhi and they had the requisite qualifications under Rule 7 of the Recruitment Rules, their appointments cannot be held to be either ad hoc or fortuitous or stop-gap, and necessarily, therefore, they must be held to be senior to , a direct recruit of the year 1982, on the basis of continuous length of Service, in accordance with the directions given by this Court in case. Similarly, the two other promotees namely and Shri , who had been appointed since August, 1984 and also continuously held the post of Additional District and Sessions Judge for all these years, must be held to be senior to the direct recruits namely Ms. , who was directly recruited on 07.6.1985 and Shri and , who were directly recruited on 26.11.1985. ", "It would be worthwhile to notice that the promotee officers, in their rejoinder affidavit, have indicated that in course of arguments in case, had directed to submit a chart, indicating under which rule, the promotees had been appointed and pursuant to the said directions, had submitted a chart and all the petitioners(the promotees) were shown to have been appointed either under Rule 16 or Rule 17. A chart, also purported to have been filed in the earlier case, has been enclosed to the rejoinder affidavit, which clearly indicates the factual matrix, which were there before this in case. Even, in its counter affidavit in the present proceedings, has submitted that all the petitioners herein were appointed under Rule 16 or 17 of the Rules and the respective dates of appointments are matters of record. ", "So far as the argument of Mr. , the learned senior counsel, appearing for the direct recruits, to the effect that in view of the definition of Service in Rule 2(d), the appointees under Rule 16 cannot be held to be Members of the Service, it may be stated that the said question was duly considered in case and on an analysis of the scheme of the Rules, this Court came to the conclusion that the Rule is peculiar in nature and is a larger concept than Service under the Recruitment Rules. The Court recorded a finding that all persons recruited under Rule 17 to the posts having the same designation, as per the post in the schedule, must be held to be Members of the and, therefore, while determining the inter se seniority in the '', they cannot be ignored from consideration nor can they be held to be alien to the . The said contention of Mr. , accordingly, cannot be sustained. ", "So far as the contention of Mr. , the learned senior counsel, appearing for the direct recruits, is concerned, in praying for re- consideration of the judgment of this in case, the same also cannot be sustained inasmuch as the in case did consider the earlier decision of this in case, and recorded a finding that in that case, it was only a matter of adjustment of seniority between the promotees inter-se and not between the promotees and direct recruits and, therefore, the ratio therein is of no application. Further, Justice , in his concurring judgment did consider naths case and held that the principle evolved therein cannot be applied to the case in hand, where inter-se seniority between the promotees and direct recruits are going to be decided on equitable consideration. We are also unable to accept the contention of Mr. that until the principle of quota provided in Rule 8 is made applicable to appointments under Rules 16 and 17, such appointees, under Rules 16 and 17 cannot claim continuous length of service for their seniority. Such a contention appears to have been considered and negatived in case. The Judgment of this in case is obviously intended to evolve some equitable principle for determination of inter-se seniority of a group of officers, when the rule of seniority contained in Rule 8(2) has been held to be not operative because of breaking down of quota and rota rule. To meet the peculiar situation, the evolved the principle that continuous length of service should be the criteria for inter-se seniority between the direct recruits and the promotees, provided, the promotees did possess the required qualification as per Rule 7 and the appointments had been made under Rules 16 and 17, after due consultation and/or approval of the High , which in our view also is the most appropriate basis, evolved in the fact situation. This being the position, we see no justification for re-considering the decision of this in case. That apart, the Recruitment Rules have been amended in the year 1987 and the aforesaid principle, which had been evolved in case, would apply for determining the inter-se seniority between the promotees and direct recruits, all of whom had been appointed to , prior to the amendment of the Rules in question, which was made in the year 1987. We have also considered the arguments advanced by Mr. , the learned senior counsel, appearing for Delhi High and we are unable to persuade ourselves to accept the same inasmuch as it is not a mere question of leveling, as urged by Mr. , but, it is a question which was directly considered by this in case and, after examining the representative order, the positively recorded a conclusion that the appointments made under Rule 16 or 17 cannot be held to be alien to the Cadre. In fact the was persuaded to come to the aforesaid conclusion, as it was found that the persons appointed under Rules 16 and 17 having all the necessary qualifications and having been appointed after due consultation with the High , though they had served for more than five to seven years, but yet have been shown junior to the direct recruits, who had come to the Service much later than them. It is, therefore, not possible for us to accept Mr. s contention and permit any further scrutiny into such appointments made either under Rule 16 or under Rule 17 of the Recruitment Rules. It is in fact, interesting to notice that the schedule to the Recruitment Rules, which came into existence in 1971, was amended for the first time only in the year 1991, 20 years, after and if a strict construction to the different provisions of the Rules would be given, then all the temporary appointees under Rule 16, who might have rendered 5 to 10 years of Service would be denied of their right for the purpose of seniority. It is this impasse, created on account of inaction of the authorities and on account of non- adherence to the provisions of the Rules strictly, which persuaded the in case to evolve the principles for working out equities and that principle has to be followed by the High in drawing up the seniority list. It is not necessary to deal with the contention, raised by Mr. , appearing for the direct recruits and , appearing in person, who is a direct recruit also, as well as Mr. , appearing in person, who is a promotee, as essentially, they adopted the arguments of either Mr. or Mr. and Mr. . ", "So far as the terminology used in case, namely ad hoc, fortuitous and stop-gap, the same is quite familiar in the Service Jurisprudence. Mr. , appearing for , however contended before us that the said terminology should be given the same meaning, as was given in , 1958 S.C.R. Page 828. In case, the was examining whether removal of an employee can be held to be a penal and whether Article 311(2) of the Constitution can at all be attracted and the also observed that certain amount of confusion arises because of the indiscriminate use of the words provisional, officiating and on probation. We do not think that the concept or meaning given to those terminology in case will have any application to the case in hand, where the is trying to work- out an equitable remedy in a manner which will not disentitle an appointee, the benefit of his fairly long period of Service for the purpose of seniority, even though he possesses the requisite qualification and even though his appointment has been made after due consultation and/or approval of the High . ", "The three terms ad hoc, stop gap and fortuitous are in frequent use in service jurisprudence. In the absence of definition of these terms in the rules in question we have to look to the dictionary meaning of the words and the meaning commonly assigned to them in service matters. The meaning given to the expression fortuitous in Strouds Judicial Dictionary is accident or fortuitous casualty. This should obviously connote that if an appointment is made accidentally, because of a particular emergent situation and such appointment obviously would not continue for a fairly long period. But an appointment made either under Rule 16 or 17 of the Recruitment Rules, after due consultation with and the appointee possesses the prescribed qualification for such appointment provided in Rule 7 and continues as such for a fairly long period, then the same cannot be held to fortuitous. In dictionary, the expression fortuitous means occurring by chance, a fortuitous event may be highly unfortunate. It thus, indicates that it occurs only by chance or accident, which could not have been reasonably foreseen. The expression ad hoc in Dictionary, means something which is formed for a particular purpose. The expression stop-gap as per , means a temporary way of dealing with a problem or satisfying a need. ", "In Oxford Dictionary, the word ad hoc means for a particular purpose; specially. In the same Dictionary, the word fortuitous means happening by accident or chance rather than design. ", "In (2nd Edition) the word ad hoc is described as for particular purpose, Made, established, acting or concerned with a particular and or purpose. The meaning of word fortuitous event is given as an event which happens by a cause which we cannot resist; one which is unforeseen and caused by superior force, which it is impossible to resist; a term synonymous with Act of God. ", "The meaning to be assigned to these terms while interpreting provisions of a Service Rule will depend on the provisions of that Rule and the context in and the purpose for which the expressions are used. The meaning of any of these terms in the context of computation of inter-se seniority of officers holding cadre post will depend on the facts and circumstances in which the appointment came to be made. For that purpose it will be necessary to look into the purpose for which the post was created and the nature of the appointment of the officer as stated in the appointment order. If the appointment order itself indicates that the post is created to meet a particular temporary contingency and for a period specified in the order, then the appointment to such a post can be aptly described as ad hoc or stop-gap. If a post is created to meet a situation which has suddenly arisen on account of happening of some event of a temporary nature then the appointment of such a post can aptly be described as fortuitous in nature. If an appointment is made to meet the contingency arising on account of delay in completing the process of regular recruitment to the post due to any reason and it is not possible to leave the post vacant till then, and to meet this contingency an appointment is made then it can appropriately be called as a stop-gap arrangement and appointment in the post as ad hoc appointment. It is not possible to lay down any straight-jacket formula nor give an exhaustive list of circumstances and situation in which such an appointment (ad hoc, fortuitous or stop-gap) can be made. As such, this discussion is not intended to enumerate the circumstances or situations in which appointments of officers can be said to come within the scope of any of these terms. It is only to indicate how the matter should be approached while dealing with the question of inter se seniority of officers in the cadre. ", "In the Service Jurisprudence, a person who possesses the requisite qualification for being appointed to a particular post and then he is appointed with the approval and consultation of the appropriate authority and continues in the post for a fairly long period, then such appointment cannot be held to be stop-gap or fortuitous or purely ad hoc. In this view of the matter, the reasoning and basis on which, the appointment of the promotees in in the case in hand was held by to be fortuitous/ad hoc/stop-gap are wholly erroneous and, therefore, exclusion of those appointees to have their continuous length of service for seniority is erroneous. ", "In view of our conclusions, as aforesaid, we quash the seniority list both provisional and final, so far as, it relates to the appointees either by direct recruitment or by promotion in , prior to the amendment of the Recruitment Rules in the year 1987, and their inter-se seniority must be re- determined on the basis of continuous length of service in the , as indicated in case and explained by us in this judgment. Since the future of these officers to a great extent depends upon seniority and many of these officers may be on the verge of superannuation, would do well in finalising the seniority within a period of six weeks from the date of receipt of this judgment. ", "Writ Petition No. 490/87 is accordingly allowed. Writ Petition Nos. 1252/90 and 14114/84 are accordingly dismissed. Writ Petition Nos. 707/88, 856/88 and 764/88 stand disposed of in terms of the directions given herein-above. Application for impleadment filed by Mr. in Writ Petition(Civil) No.490/87 is allowed. Application for impleadment filed by one Ms. in Writ Petition(Civil) No.1252 of 1990, stands rejected, since in this batch of cases, we are concerned with the inter-se seniority between the direct recruits and the promotees, who are appointed prior to the amendment of the Rules in 1987 and the applicant Ms. was appointed in January, 1988. ", "The application for impleadment by Shri in Writ Petition(Civil) No. 14114 of 1984 stands allowed. ", "...............................................J. (G.B. PATTANAIK) ...............................................J. (S. RAJENDRA BABU)"], "relevant_candidates": ["0001270113", "0001304035", "0001999566"]} {"id": "0001416283", "text": ["PETITIONER: D.S. NAKARA & OTHERS Vs. RESPONDENT: UNION OF INDIA DATE OF JUDGMENT17/12/1982 BENCH: , D.A. BENCH: , D.A. CHANDRACHUD, , V.D. REDDY, O. CHINNAPPA (J) ISLAM, (J) CITATION: 1983 AIR 130 1983 SCR (2) 165 1983 SCC (1) 305 1982 SCALE (2)1213 CITATOR INFO : R 1983 SC 937 (34) R 1984 SC 121 (28) R 1984 SC1064 (18) R 1984 SC1247 (1) RF 1984 SC1361 (19) RF 1984 SC1560 (2) F 1985 SC1196 (2,7) D 1985 SC1367 (39,43) RF 1986 SC 210 (19,20,22,26) R 1986 SC 584 (1) R 1986 SC1907 (1,2) R 1987 SC 943 (8) RF 1987 SC2359 (17) D 1988 SC 501 (3,4,6,7) RF 1988 SC 740 (13) D 1988 SC1291 (9) R 1988 SC1645 (8) D 1989 SC 665 (7) F 1989 SC2088 (7) R 1990 SC 334 (104) RF 1990 SC 883 (6) E 1990 SC1760 (9) RF 1990 SC1923 (3) D 1990 SC2043 (2,7) E 1991 SC1182 (6 TO 16,18,19,23) RF 1991 SC1743 (1,2,4) R 1992 SC 96 (11) R 1992 SC 767 (2,4,TO 8,10) ACT: Constitution of India, Art. 14- Central Civil Services (Pension) Rules, 1972 and Regulations governing pension for Armed Forces Personnel-Liberalisation in computation of pension effective from specified date-Divides pensioners so as to confer benefit on some while denying it to others- Classification arbitrary, devoid of rational nexus to object of liberalisation and violative of Art. 14 Constitution of India, Art. 14- Doctrine of severability-Severance may have effect of enlarging scope of legislation. Rules and Regulations governing grant of pension- Pension is a right-Deferred portion of compensation for service rendered-Also a social-welfare measure. HEADNOTE: By a Memorandum dated May 25, 1979 (Exhibit P-1) liberalised the formula for computation of pension in respect of employees governed by s (Pension) Rules, 1972 and made it applicable to employees retiring on or after March 31, 1979. By another Memorandum issued on September 23, 1979 (Exhibit P-2) it extended the same, subject to certain limitations, to personnel retiring on or after April 1, 1979. Petitioners 1 and 2 who had retired in the year 1972 from and service respectively, and petitioner No. 3, a registered society espousing the cause of pensioners all over the country, challenged the validity of the above two memoranda in so far as the liberalisation in computation of pension had been made applicable only to those retiring on or after the date specified and the benefit of liberalisation had been denied to all those who had retired earlier. Counsel for petitioners contended that all pensioners entitled to receive pension under the relevant rules form a class irrespective of the dates of their retirement and there cannot be a mini-classification within this class; that the differential treatment accorded to those who had retired prior to the specified date is violative of Art. 14 as the choice of specified date is wholly arbitrary and the classification based on the fortuitous circumstance of retirement before or subsequent to the specified date is invalid; and that the scheme of liberalisation in computation of pension must be uniformly enforced with regard to all pensioners. 166 Counsel for respondents contended that a classification based on the date of retirement is valid for the purpose of granting pensionary benefits; that the specified date is an integral part of the scheme of liberalisation and the would never have enforced the scheme devoid of the date; that the doctrine of severability cannot be invoked to sever the specified date from the scheme as it would have the effect of enlarging the class of pensioners covered by the scheme and when the legislature has expressly defined the class to which the legislation applies it would be outside the judicial function to enlarge the class; that there is not a single case where the court has included some category within the scope of provisions of a law to maintain its constitutionality; that since the scheme of liberalisation has financial implications, the cannot make it retroactive; that if more persons divided the available cake the residue falling to the share of each, especially to the share of those who are not before the court would become far less and therefore no relief could be given to the petitioners that pension is always correlated to the date of retirement and the court cannot change the date of retirement and impose fresh commutation benefit which may burden the exchequer to the tune of Rs. 233 crores; and that the third petitioner has no locus standi in the case. Allowing the petitions, ^ HELD: Article 14 strikes at arbitrariness in action and ensures fairness and equality of treatment. It is attracted where equals are treated differently without any reasonable basis. The principle underlying the guarantee is that all persons similarly circumstanced shall be treated alike both in privileges conferred and liabilities imposed. Equal laws would have to be applied to all in the same situation and there should be no discrimination between one person and another if as regards the subject-matter of the legislation their position is substantially the same. Article 14 forbids class legislation but permits reasonable classification for the purpose of legislation. The classification must be founded on an intelligible differentia which distinguishes persons or things that are grouped together from those that are left out of the group and that differentia must have a rational nexus to the object sought to be achieved by the statute in question. In other words, there ought to be causal connection between the basis of classification and the object of the statute. The doctrine of classification was evolved by the for the purpose of sustaining a legislation or action designed to help weaker sections of the society. Legislative and executive action may accordingly be sustained by the court if the satisfies the twin tests of reasonable classification and the rational principle correlated to the object sought to be achieved. A discriminatory action is liable to be struck down unless it can be shown by the that the departure was not arbitrary but was based on some valid principle which in itself was not irrational, unreasonable or discriminatory. [176 B, 178 D-E, 179 B-C, 177 C-D, 179 C-D, 176 E-F, 179 H, 180 , 2 S.C.R. 621; ., S.C.R. 279; In re Special s Bill, 2 S.C.R, 476; , 2 S.C.R. 348; etc. v. & Ors., 2 S.C.R. 79; etc. v. & Ors., 1 S.C.R. 438 and ., 3 S.C.R. 1014, referred to. 167 In the instant case, looking to the goals for the attainment of which pension is paid and the welfare proposed to be set up in the light of the Directive Principles of Policy and Preamble to the Constitution it indisputable that pensioners for payment of pension from a class. When the considered it necessary to liberalise the pension scheme in order to augment social security in old age to government servants it could not grant the benefits of liberalisation only to those who retired subsequent to the specified date and deny the same to those who had retired prior to that date. The division which classified the pensioners into two classes on the basis of the specified date was devoid of any rational principle and was both arbitrary and unprincipled being unrelated to the object sought to be achieved by grant of liberalised pension and the guarantee of equal treatment contained in Art. 14 was violated inasmuch as the pension rules which were statutory in character meted out differential and discriminatory treatment to equals in the matter of computation of pension from the dates specified in the impugned memoranda. [190 F-H, 194 A-C, 194 F-H] (ii) Prior to the liberalisation of the formula for computation of pension average emoluments of the last 36 months' service of the employee provided the measure of pension. By the liberalised scheme, it is now reduced to average emoluments of the last 10 months' service. Pension would now be on the higher side on account of two fortuitous circumstances, namely, that the pay scales permit annual increments and usually there are promotions in the last one or two years of the employee's service. Coupled with it a slab system for computation has been introduced and the ceiling of pension has been raised. Pensioners who retired prior to the specified date would suffer triple jeopardy, viz., lower average emoluments, absence of slab system and lower ceiling. [191 A-D] (iii) Both the impugned memoranda do not spell out the raison d'etre for liberalising the pension formula. In the affidavit in opposition it is stated that the liberalisation was decided by the government in view of the persistent demand of the employees represented in the scheme of . This would clearly imply that the pre-liberalised scheme did not provide adequate protection in old age, and that a further liberalisation was necessary as a measure of economic security. The government also took note of the fact that continuous upward movement of the cost of living index and diminishing purchasing power of rupee necessitated upward revision of pension. When the government favourably responded to the demand it thereby ipso facto conceded that there was a larger available national cake, part of which could be utilised for providing higher security to retiring employees. With this underlying intendment of liberalisation, it cannot be asserted that it was good enough only for those who would retire subsequent to the specified date but not for those who had already retired. [191 F-G, 192 A, 191 H, 192 B] 2. If removal of arbitrariness can be brought about by severing the mischievous portion, the discriminatory part ought to be removed retaining the beneficial portion. [198 F] In the instant case, the petitioners do not challenge, but seek the benefit of the liberalised pension scheme. Their grievance is of the denial to them of the same by arbitrary introduction of words of limitation. There is nothing 168 immutable about the choosing of an event as an eligibility criteria subsequent to a specified date. If the event is certain but its occurrence at a point of time is considered wholly irrelevant and arbitrarily selected having an undesirable effect of dividing a homogeneous class and of introducing discrimination the same can be easily severed and set aside. It is therefore just and proper that the words introducing the arbitrary fortuitous circumstance which are vulnerable as denying equality be severed and struck down. In Exhibit P-1 the words: \"That in respect of the servants who were in service on the 31st March, 1979 and retiring from service on or after that date. and in Exhibit P-2, the words: \"the new rates of pension are effective from Ist April 1979 and will be applicable to all service officers who became/become noneffective on or after that date\" are unconstitutional and are struck down with the specification that the date mentioned therein will be relevant as being one from which the liberalised pension scheme becomes operative. Omitting the unconstitutional part it is declared that all pensioners governed by the 1972 Rules and Army Pension Regulations shall be entitled to pension as computed under the liberalised pension scheme from the specified date, irrespective of the date of retirement. Arrears of pension prior to the specified date as per fresh computation is not admissible. [190A-C, 198 G, 198 E-F, 205 F-H, 209 F-H, 210 , 2 S.C.R. 325; and ., Supp. S.C.R. 428, relied on. etc., 2 S.C.R. 573; and D.C. Gouse & Co. etc. v. of Kerala & Anr. etc., 1 S.C.R. 804, explained and distinguished. v. , 240 U.S. 30 , referred to. (ii) The reading down of the impugned memoranda by severing the objectionable portion would not render the liberalised pension scheme vague, unenforceable or unworkable. The is not legislating in reading down the memoranda; when the strikes down the basis of classification as violative of Art. 14 it merely sets at naught the unconstitutional portion retaining the constitutional portion. There is no difficulty in implementing the scheme omitting the event happening after the specified date, retaining the more human formula for computation of pension. The pension will have to be recomputed in accordance with the provisions of the liberalised pension scheme as salaries were required to be recomputed in accordance with the recommendation of but becoming operative from the specified date. The is satisfied that the additional financial liability that may be imposed by bringing 169 in pensioners who retired prior to April 1, 1979 within the fold of the liberalised pension scheme is not too high to be unbearable or such as would have detracted the from covering the old pensioners under the scheme. The severance of the nefarious unconstitutional part does not adversely affect future pensioners and their presence in these petitions is irrelevant. [204 G-H, 197 E-F, 206 B, 196 G, 208 G, 199 B] (iii) To say that by its approach the is restructuring the liberalised pension scheme is to ignore the constitutional mandate. The is not conferring benefits by its approach; it is only removing the illegitimate classification and after its removal the law takes its own course. [206 D-E] (iv) It is not correct to say that if the unconstitutional part is struck down the would not have enacted the measure. The executive, with parliamentary mandate, liberalised the pension scheme. It is implicit in the scheme that the need to grant a little higher rate of pension to the pensioners was considered eminently just. One could have understood persons in the higher pay bracket being excluded from the benefit of the scheme because it would have meant that those in the higher pay bracket could fend for themselves. Such is not the exclusion. The exclusion is of a whole class of people who retired before a certain date. would not have hesitated to extend the benefit otherwise considered eminently just and this becomes clearly discernible from p.35 of the 9th Report of (6th ), April 1979. [206 H, 207 A-E] (v) Whenever classification is held to be impermissible and the measure can be retained by removing the unconstitutional portion of the classification, the resultant effect may be of enlarging the class. In such a situation the court can strike down the words of limitation in an enactment. That is what is called reading down the measure. There is no principle that severance limits the scope of legislation but can never enlarge it. [205 B-C] Jaila Singh & Ors. v of Rajasthan & Ors., Supp. S.C.R. 428 and . 1 S.C.C. 618, relied on. (vi) The absence of precedent does not deter the court. Every new norm of socio-economic justice, every new measure of social justice commenced for the first time at some point of time in history. If at that time it was rejected as being without a precedent, law as an instrument of social engineering would have long since been dead. [193 G, 193 C- D] (vii) The court is not making the scheme of liberalisation retroactive by its approach. Retroactiveness is implicit in the theory of wages. When revised pay-scales are introduced from a certain date, all existing employees are brought on to the revised scales adopting a theory of fitments and increments for past service. The benefit of revised scales is not limited to those who enter service subsequent to the date fixed for introducing revised scales but is extended to all those in service prior to that date. Even in the case of the new retiral benefit of gratuity under the Payment of Gratuity Act , 1972, past service was taken into consideration. The scheme of liberalisation is not a new retiral benefit; it is 170 an upward revision of an existing benefit. Pension has correlation to average emoluments and the length of qualifying service and any liberalisation would pro tanto ber etroactive in the narrow sense of the term. Assuming the government had not prescribed the specified date and thereby provided that those retiring, pre and past the specified date, would all be governed by the liberalised pension scheme it would be both prospective and retroactive. Only the pension will have to be recomputed in the light of the formula enacted in the liberalised pension scheme and effective from the date the revised scheme comes into force. A statute is not properly called retroactive because a part of the requisites for its action is drawn from a time antecedent to its passing. [195 H, 196 H, 196 G, 196 D, 196 B-D] Craies on Statute Law, Sixth Edition, p. 387 referred to. (viii) There is no question of pensioners dividing the pension fund which, if more persons are admitted to the scheme, would pro rata affect the share. The pension scheme, including the liberalised scheme, is non-contributory in character. The payment of pension is a statutory liability undertaken by the . Whatever becomes due and payable on account of pension is recognised as an item of expenditure and is budgeted for every year. At any given point of time there is no fixed or pre-determined pension fund which is divided amongst eligible pensioners. [195 C-G] (ix) The date of retirement of each employee remaining as it is, there is no question of fresh commutation of pension of the pensioners who retired prior to 31st March 1979 and have already availed of the benefit of commutation. It is not open to them to get that benefit at this late date because commutation has to be availed of within the specified time limit from the date of actual retirement. [206 C-D] 3. The discernible purpose underlying the pension scheme must inform the interpretative process and it should receive a liberal construction. [185 G-H] (i) Pension is a right; not a bounty or gratuitous payment. The payment of pension does not depend upon the discretion of the but is governed by the rules and a government servant coming within those rules is entitled to claim pension. [186 A-B] v. of Bihar & Ors., Supp. S.C.R. 634 and of Punjab & Anr.v Iqbal Singh, 3 S.C.R. 360, referred to. (ii) The pension payable to a government employee is earned by rendering long and efficient service and therefore can be said to be a deferred portion of the compensation for service rendered. [185 F] (iii) Pension also has a broader significance in that it is a social-welfare measure rendering socio-economic justice by providing economic security in old age to those who toiled ceaselessly in the hey-day of their life. [185 D- E, 186 B-C] (iv) Pension as a retirement benefit is in consonance with and in furtherance of the goals of the Constitution. The goals for which pension is 171 paid themselves give a fillip and push to the policy of setting up a welfare state. The preamble to the Constitution envisages the establishment of a socialist republic. The basic framework of socialism is to provide a decent standard of life to the working people and especially provide security from cradle to grave. Article 41 enjoins the to secure public assistance in old age, sickness and disablement. Every state action whenever taken must be directed and must be so interpreted as to take society one step towards the goal of establishing a socialist welfare society. While examining the constitutional validity of legislative/administrative action, the touchstone of Directive Principles of Policy in the light of the Preamble provides a reliable yardstick to hold one way or the other. [190 E,187 F,189 A-B,189 H] Randhir Singh v. ., I S.C.C. 618 and ., I S.C.R. 206, referred to. 4. Any member of the public having sufficient interest can maintain an action for judicial redress for public injury arising from breach of public duty or from violation of some provision of the Constitution or the law and seek enforcement of such public duty and observance of such constitutional or legal provision. The locus standi of petitioner No. 3 which seeks to enforce rights that may be available to a large number of old, infirm retirees is unquestionable as it is a non-political, non-profit, voluntary organisation registered under the Societies Registration Act , 1860 and its members consist of public spirited citizens who have taken up the cause of ventilating legitimate public problems. [208 H, 209 A-C] v. Union of India, Supp. S.C.C.87, referred to. JUDGMENT: ", "ORIGINAL JURISDICTION : Writ Petition Nos. 5939-41 of 1980. ", ", Mrs. and for the Petitioners ,Attorney General, , and Miss for . ", " and for the interveners. for the Intervener. ", " for the Intervener. ", "The Judgment of the Court was delivered by , a slight variation to suit the context 's prayer : \"had I served my God as reverently as I did my king, I would not have fallen on these days of penury\" is chanted by petitioners in this group of petitions in the Shellian tune : 'I fall on the thorns of life I bleed.' Old age, ebbing mental and physical prowess, atrophy of both muscle and brain powers permeating these petitions, the petitioners in the fall of life yearn for equality of treatment which is being meted out to those who are soon going to join and swell their own ranks, Do pensioners entitled to receive superannuation or retiring pension under Central Civil Services (Pension) Rules, 1972 ('1972 Rules' for short) form a class as a whole ? Is the date of retirement a relevant consideration for eligibility when a revised formula for computation of pension is ushered in and made effective from a specified date ? Would differential treatment to pensioners related to the date of retirement qua the revised formula for computation of pension attract Article 14 of the Constitution and the element of discrimination liable to be declared unconstitutional as being violative of Art. 14 ? These and the related questions debated in this group of petitions call for an answer in the backdrop of a welfare State and bearing in mind that pension is a socio-economic justice measure providing relief when advancing age gradually but irrevocably impairs capacity to stand on one's own feet. ", "Factual matrix has little relevance to the issues raised and canvassed at the hearing. Petitioners 1 and 2 are retired pensioners of , the first being a civil servant and the second being a member of the service personnel of . The third petitioner is a society registered under the Societies Registration Act , 1860, formed to ventilate the legitimate public problems and consistent with its objective it is espousing the cause of the pensioners all over the country. Its locus standi is in question but that is a different matter. The first petitioner retired in 1972 and on computation, his pension worked out at Rs. 675/- p.m. and along with the dearness relief granted from time to time, at the relevant time he was in receipt of monthly pension of Rs. 935/-. The second petitioner retired at or about that time and at the relevant time was in receipt of a pension plus dearness relief of Rs. 981/- p.m. has been revising and liberalising the pension rules from time to time. Some landmark changes may be noticed. ", " (1946-47) recommended that the age of retirement in future should be uniformly 58 years for all services and the scale of pension should be 1/80 of the emoluments for each year of service, subject to a limit of 35/80 with a ceiling of Rs. 8,000 per year for 35 years of service, which while accepting the recommendation raised to Rs. 8,100 per year which would earn a monthly pension of Rs. 675 at the maximum. (1957-58) re-affirmed that the age of superannuation should be 58 years for all classes of public servants but did not recommend any increase in the non- contributory retirement benefits and recommended that if in future any improvement is to be made, it was the considered view of the that these benefits should be on a contributory basis. The Administrative Reforms ('' for short) set up by in 1956 took note of the fact that the cost of living has shot up and correspondingly the possibility of savings has gone down and consequently the drop in wages on retirement is in reality much steeper than what the quantum of pension would indicate, and accordingly the recommended that the quantum of pension admissible may be raised to 3/6 of the emoluments of the last three years of service as against the existing 3/8 and the ceiling should be raised from Rs. 675 p.m. to Rs. 1000 p.m. Before the Government could take its decision on the recommendations of the , the Third Central Pay was set up. One of the terms of reference of the Third Pay was 'death-cum- retirement benefits of employees'. The Third Pay did not examine the question of relief to pensioners because in its view unless the terms of reference were suitably amended it would not be within their jurisdiction to examine this question and on a reference by them, decided not to amend the terms of reference. With regard to the future pensioners the Third Pay while reiterating that the age of superannuation should continue to be 58 years further recommended that no change in the existing formula for computing pension is considered necessary. The only important recommendation worth noticing is that the recommended that the existing ceiling of maximum pension should be raised from Rs. 675 to Rs. 1,000 p.m. and the maximum of the gratuity should be raised from Rs. 24,000 to Rs. 30,000. ", "On May 25, 1979, , , issued Office Memorandum No. F-19(3)-EV-79 whereby the formula for computation of pension was liberalised but made it applicable to servants who were in service on March 31, 1979 and retire from service on or after that date (specified date for short). The formula introduced a slab system for computation of pension. This liberalised pension formula was applicable to employees governed by the 1972 Rules retiring on or after the specified date. The pension for the service personnel which will include , and staff is governed by the relevant regulations. By the Memorandum of the Ministry of Defence bearing No. B/40725/AG/PS4-C/1816/AD (Pension)/Services dated September 28, 1979, the liberalised pension formula introduced for the government servants governed by the 1972 rules was extended to the personnel subject to limitations set out in the memorandum with a condition that the new rules of pension would be effective from April 1, 1979, and may be applicable to all service officers who become/became non-effective on or after that date. (for short specified date). ", "The chronology of events herein narrated would bring to surface the contentions raised in these petitions. The liberalised pension formula shall be applicable prospectively to those who retired on or after March 31, 1979 in case of government servants covered by 1972 Rules and in respect of defence personnel those who became/become non-effective on or after April 1, 1979. Consequently those who retired prior to the specified date would not be entitled to the benefits of the liberalised pension formula. ", "Petitioners accordingly contend that this Court may consider the raison d'etre for payment of pension. If the Pension is paid for past satisfactory service rendered, and to avoid destitution in old age as well as a social welfare or socio-economic justice measure, the differential treatment for those retiring prior to a certain date and those retiring subsequently, the choice of the date being wholly arbitrary, would be according differential treatment to pensioners who form a class irrespective of the date of retirement and, therefore, would be violative of Art. 14. It was also contended that classification based on fortuitous circumstance of retirement before or subsequent to a date, fixing of which is not shown to be related to any rational principle, would be equally violative of Art. 14. ", "Primary contention is that the pensioners of form a class for purpose of pensionary benefits and there could not be mini-classification within the class designated as pensioners. The expression 'pensioner' is generally understood in contra-distinction to the one in service. Government servants in service, in other words, those who have not retired, are entitled to salary and other allowances. Those who retire and are designated as 'pensioners' are entitled to receive pension under the relevant rules. Therefore, this would clearly indicate that those who render service and retire on superannuation or any other mode of retirement and are in receipt of pension are comprehended in the expression 'pensioners'. ", "Is this class of pensioners further divisible for the purpose of 'entitlement' and 'payment' of pension into those who retired by certain date and those who retired after that date ? If date of retirement can be accepted as a valid criterion for classification, on retirement each individual government servant would form a class by himself because the date of retirement of each is correlated to his birth date and on attaining a certain age he had to retire. It is only after the recommendations of were accepted by that the retirement dates have been specified to be 12 in number being last day of each month in which the birth date of the individual government servant happens to fall. In other words, all government servants who retire correlated to birth date on attaining the age of superannuation in a given month shall not retire on that date but shall retire on the last day of the month. Now, if date of retirement is a valid criterion for classification, those who retire at the end of every month shall form a class by themselves. This is too microscopic a classification to be upheld for any valid purpose. Is it permissible or is it violative of Art. 14 ? ", "The scope, content and meaning of Article 14 of the Constitution has been the subject-matter of intensive examination by this Court in a catena of decisions. It would, therefore, be merely adding to the length of this judgment to recapitulate all those decisions and it is better to avoid that exercise save and except referring to the latest decision on the subject in (1) from which the following observation may be extracted: ", "\"...... what is the content and reach of the great equalising principle enunciated in this article ? There can be no doubt that it is a founding faith of the Constitution. It is indeed the pillar on which rests securely the foundation of our democratic republic. And, therefore, it must not be subjected to a narrow, pedantic or lexicographic approach. No attempt should be made to truncate its all-embracing scope and meaning for, to do so would be to violate its activist magnitude. Equality is a dynamic concept with many aspects and dimensions and it cannot be imprisoned within traditional and doctrinaire limits..... Article 14 strikes at arbitrariness in action and ensures fairness and equality of treatment. The principle of reasonableness, which legally as well as philosophically, is an essential element of equality or non-arbitrariness pervades Article 14 like a brooding omnipresence.\" ", "The decisions clearly lay down that though Art. 14 forbids class legislation, it does not forbid reasonable classification for the purpose of legislation. In order, however, to pass the test of permissible classification, two conditions must be fulfilled, viz., (i) that the classification must be founded on an intelligible differentia which distinguishes persons or things that are grouped together from those that are left out of the group; and (ii) that differentia must have a rational relation to the objects sought to be achieved by the statute in question. (see .(1) The classification may be founded on differential basis according to objects sought to be achieved but what is implicit in it is that there ought to be a nexus i.e., causal connection between the basis of classification and object of the statute under consideration. It is equally well settled by the decisions of this Court that Art. 14 condemns discrimination not only by a substantive law but also by a law of procedure. ", "After an exhaustive review of almost all decisions bearing on the question of Art. 14 , this Court speaking through , C.J. in Re. Special Courts Bill (2) restated the settled propositions which emerged from the judgments of this Court undoubtedly insofar as they were relevant to the decision on the points arising for consideration in that matter. Four of them are apt and relevant for the present purpose and may be extracted. They are: ", "\"3. The constitutional command to the to afford equal protection of its laws sets a goal not attainable by the invention and application of a precise formula. Therefore, classification need not be constituted by an exact or scientific exclusion or inclusion of persons or things. The should not insist on delusive exactness or apply doctrinaire tests for determining the validity of classification in any given case. Classification is justified if it is not palpably arbitrary. ", "4. The principle underlying the guarantee of Article 14 is not that the same rules of law should be applicable to all persons within the Indian territory or that the same remedies should be made available to them irrespective of differences of circumstances. It only means that all persons similarly circumstanced shall be treated alike both in privileges conferred and liabilities imposed. Equal laws would have to be applied to all in the same situation, and there should be no discrimination between one person and another if as regards the subject matter of the legislation their position is substantially the same. ", "6. The law can make and set apart the classes according to the needs and exigencies of the society and as suggested by experience. It can recognise even degree of evil, but the classification should never be arbitrary, artificial or evasive. ", "7. The classification must not be arbitrary but must be rational, that is to say, it must not only be based on some qualities or characteristics which are to be found in all the persons grouped together and not in others who are left out but those qualities or characteristics must have a reasonable relation to the object of the legislation. In order to pass the test, two conditions must be fulfilled, namely, (1) that the classification must be founded on an intelligible differentia which distinguishes those that are grouped together from others and (2) that differentia must have a rational relation to the object sought to be achieved by the Act.\" ", "The other facet of Art. 14 which must be remembered is that it eschews arbitrariness in any form. Article 14 has, therefore, not to be held identical with the doctrine of classification. As was noticed in case in the earliest stages of evolution of the Constitutional law, Art. 14 came to be identified with the doctrine of classification because the view taken was that Art. 14 forbids discrimination and there will be no discrimination where the classification making the differentia fulfils the aforementioned two conditions. However, in EP. v. ), it was held that the basic principle which informs both Arts. 14 and 16 is equality and inhibition against discrimination. This Court further observed as under: ", "\"From a positivistic point of view, equality is antithetic to arbitrariness. In fact, equality and arbitrariness are sworn enemies; one belongs to the rule of law in a republic while the other, to the whim and caprice of an absolute monarch. Where an act is arbitrary it is implicit in it that it is unequal both according to political logic and constitutional law and is, therefore, violative of Art. 14 , and if it affects any matter relating to public employment, it is also violative of Art. 16. Articles 14 and 16 strike at arbitrariness in action and ensure fairness and equality of treatment. ", "Justice has in his inimitable style dissected Art. ", "14 as under: ", "\"The article has a pervasive processual potency and versatile quality, equalitarian in its soul and allergic to discriminatory diktats. Equality is the antithesis of arbitrariness and ex cathedra ipse dixit is the ally of demagogic authoritarianism. Only knight- ", "errants of 'executive excesses'-if we may use current cliche-can fall in love with the Dame of despotism, legislative or administrative. If this gives in here it gives up the ghost. And so it that I insist on the dynamics of limitations on fundamental freedoms as implying the rule of law; be you ever so high, the law is above you.\"(2) Affirming and explaining this view, the Constitution Bench in etc. v. & others etc. (3) held that it must, therefore, now be taken to be well settled that what Art.14 strikes at is arbitrariness because any action that is arbitrary must necessarily involve negation of equality. The made it explicit that where an act is arbitrary it is implicit in it that it is unequal both according to political logic and constitutional law and is, therefore, violative of Art. 14. After a review of large number of decisions bearing on the subject, in etc. etc. v. & . etc etc. (1) the formulated propositions emerging from analysis and examination of earlier decisions. One such proposition held well established is that Art. 14 is certainly attracted where equals are treated differently without any reasonable basis. ", "Thus the fundamental principle is that Art. 14 forbids class legislation but permits reasonable classification for the purpose of legislation which classification must satisfy the twin tests of classification being founded on an intelligible differntia which distinguishes persons or things that are grouped together from those that are left out of the group and that differentia must have a rational nexus to the object sought to be achieved by the statute in question. ", "As a corrolary to this well established proposition, the next question is, on whom the burden lies to affirmatively establish the rational principle on which the classification is founded correlated to the object sought to be achieved ? The thrust of Art. 14 is that the citizen is entitled to equality before law and equal protection of laws. In the very nature of things the society being composed of unequals a welfare state will have to strive by both executive and legislative action to help the less fortunate in the society to ameliorate their condition so that the social and economic inequality in the society may be bridged. This would necessitate a legislation applicable to a group of citizens otherwise unequal and amelioration of whose lot is the object of state affirmative action. In the absence of doctrine of classification such legislation is likely to flounder on the bed rock of equality enshrined in Art. 14. The court realistically appraising the social stratification and economic inequality and keeping in view the guidelines on which the action must move as constitutionally laid down in part IV of the Constitution, evolved the doctrine of classification. The doctrine was evolved to sustain a legislation or action designed to help weaker sections of the society or some such segments of the society in need of succor. Legislative and executive action may accordingly be sustained if it satisfies the twin tests of reasonable classification and the rational principle correlated to the object sought to be achieved. The , therefore, would have to affirmatively satisfy the that the twin tests have been satisfied. It can only be satisfied if the establishes not only the rational principle on which classification is founded but correlate it to the objects sought to be achieved. This approach is noticed in .(1) when at page 1034, the observed that a discriminatory action of the Government is liable to be struck down, unless it can be shown by the Government that the departure was not arbitrary, but was based on some valid principle which in itself was not irrational, unreasonable or discriminatory. ", "The basic contention as hereinbefore noticed is that the pensioners for the purpose of receiving pension form a class and there is no criterion on which classification of pensioners retiring prior to specified date and retiring subsequent to that date can provide a rational principle correlated to object, viz., object underlying payment of pensions. In reply to this contention set out in para 19 of the petition, Mr. , Director, in part 17 of his affidavit-in-opposition on behalf of the respondents has averred as under: ", "\"The contentions in part 18 and 19 that all pensioners form one class is not correct and the petitioners have not shown how they form one class. Classification of pensioners on the basis of their date of retirement is a valid classification for the purpose of pensionary benefits.\" ", "These averments would show at a glance that the State action is sought to be sustained on the doctrine of classification and the criterion on which the classification is sought to be sustained is the date of retirement of the servant which entitled him to pension. Thus according to the respondents, pensioners who retire from Central service and are governed by the relevant pension rules all do not form a class but pensioners who retire prior to a certain date and those who retire subsequent to a certain date form distinct and separate classes. It may be made clear that the date of retirement of each individual pensioner is not suggested as a criterion for classification as that would lead to an absurd result, because in that event every pensioner relevant to his date of retirement will form a class unto himself. What is suggested is that when a pension scheme undergoes a revision and is enforced effective form a certain date, the date so specified becomes a sort of a Rubicon and those who retire prior to that date form one class and those who retire on a subsequent date form a distinct and separate class and no one can cross the Rubicon. And the learned Attorney General contended that this differentiation is grounded on a rational principle and it has a direct correlation to the object sought to be achieved by liberalised pension formula. ", "The approach of the respondents raises a vital and none too easy of answer, question as to why pension is paid. And why was it required to be liberalised ? Is the employer, which expression will include even the , bound to pay pension ? Is there any obligation on the employer to provide for the erstwhile employee even after the contract of employment has come to an end and the employee has ceased to render service ? ", "What is a pension ? What are the goals of pension ? What public interest or purpose, if any, it seeks to serve ? If it does seek to serve some public purpose, is it thwarted by such artificial division of retirement pre and post a certain date ? We need seek answer to these and incidental questions so as to render just justice between parties to this petition. ", "The antiquated notion of pension being a bounty a gratituous payment depending upon the sweet will or grace of the employer not claimable as a right and, therefore, no right to pension can be enforced through has been swept under the carpet by the decision of in v. (1) wherein this authoritatively ruled that pension is a right and the payment of it does not depend upon the discretion of the but is governed by the rules and a servant coming within those rules is entitled to claim pension. It was further held that the grant of pension does not depend upon any one's discretion. It is only for the purpose of quantifying the amount having regard to service and other allied matters that it may be necessary for the authority to pass an order to that effect but the right to receive pension flows to the officer not because of any such order but by virtue of the rules. This view was reaffirmed in (1). ", "There are various kinds of pensions and there are equally various methods of funding pension programmes. The present enquiry is limited to non-contributory superannuation or retirement pension paid by to its erstwhile employee and the purpose and object underlying it. Initially this class of pension appears to have been introduced as a reward for loyal service. Probably the alien rulers who recruited employees in lower echelons of service from the colony and exported higher level employees from the seat of Empire, wanted to ensure in the case of former continued loyalty till death to the alien rulers and in the case of latter, an assured decent living standard in old age ensuring economic security at the cost of the colony. ", "In the course of transformation of society from feudal to welfare and as socialistic thinking acquired respectability, State obligation to provide security in old age, an escape from undeserved want was recognised and as a first step pension was treated not only as a reward for past service but with a view to helping the employee to avoid destitution in old age. The quid pro quo, was that when the employee was physically and mentally alert he rendered unto master the best, expecting him to look after him in the fall of life. A retirement system therefore exists solely for the purpose of providing benefits. In most of the plans of retirement benefits, everyone who qualifies for normal retirement receives the same amount. (see Retirement Systems for Public Employees by , page 33.) As the present case is concerned with superannuation pension, a brief history of its initial introduction in early stages and continued existence till today may be illuminating. Superannuation is the most descriptive word of all but has become obsolescent because it seems ponderous. Its genesis can be traced to the first Act of (in U.K.) to be concerned with the provision of pensions generally in public offices. It was passed in 1810. The Act which substantively devoted itself exclusively to the problem of superannuation pension was superannuation Act of 1834. These are landmarks in pension history because they attempted for the first time to establish a comprehensive and uniform scheme for all whom we may now call civil servants. Even before the 19th century, the problem of providing for public servants who are unable, through old age or incapacity, to continue working, has been recognised, but methods of dealing with the problem varied from society to society and even occasionally from department to department. ", "A political society which has a goal of setting up of a welfare , would introduce and has in fact introduced as a welfare measure wherein the retiral benefit is grounded on 'considerations of obligation to its citizens who having rendered service during the useful span of life must not be left to penury in their old age, but the evolving concept of social security is a later day development'. And this journey was over a rough terrain. To note only one stage in 1856 was set up to consider whether any changes were necessary in the system established by the 1834 Act. The Report of the Commission is known as \"Northcote-Trevelyan Report\". The Report was pungent in its criticism when it says that: \"in civil services comparable to lightness of work and the certainty of provision in case of retirement owing to bodily incapacity, furnish strong inducements to the parents and friends of sickly youths to endeavour to obtain for them employment in the service of the , and the extent to which the public are consequently burdened; first with the salaries of officers who are obliged to absent themselves from their duties on account of ill health, and afterwards with their pensions when they retire on the same plea, would hardly be credited by those who have not had opportunities of observing the operation of the system\" (see , Public Sector Pensions, pp. 18-19). ", "This approach is utterly unfair because in modern times public services are manned by those who enter at a comparatively very young age, with selection through national competitive examination and ordinarily the best talent gets the opportunity. ", "Let us therefore examine what are the goals that pension scheme seeks to subserve ? A pension scheme consistent with available resources must provide that the pensioner would be able to live: (i) free from want, with decency, independence and self-respect, and (ii) at a standard equivalent at the pre-retirement level. This approach may merit the criticism that if a developing country like India cannot provide an employee while rendering service a living wage, how can one be assured of it in retirement ? This can be aptly illustrated by a small illustration. A man with a broken arm asked his doctor whether he will be able to play the piano after the cast is removed. When assured that he will, the patient replied, 'that is funny, I could not before'. It appears that determining the minimum amount required for living decently is difficult, selecting the percentage representing the proper ratio between earnings and the retirement income is harder. But it is imperative to note that as self- sufficiency declines the need for his attendance or institutional care grows. Many are literally surviving now than in the past. We owe it to them and ourselves that they live, not merely exist. The philosophy prevailing in a given society at various stages of its development profoundly influences its social objectives. These objectives are in turn a determinant of a social policy. The law is one of the chief instruments whereby the social policies are implemented and 'pension is paid according to rules which can be said to provide social security law by which it is meant those legal mechanisms primarily concerned to ensure the provision for the individual of a cash income adequate, when taken along with the benefits in kind provided by other social services (such as free medical aid) to ensure for him a culturally acceptable minimum standard of living when the normal means of doing so failed'. (see law by Prof. , p. 1). ", "Viewed in the light of the present day notions pension is a term applied to periodic money payments to a person who retires at a certain age considered age of disability; payments usually continue for the rest of the natural life of the recipient. The reasons underlying the grant of pension vary from country to country and from scheme to scheme. But broadly stated they are (i) as compensation to former members of the armed forces or their dependents for old age, disability, or death (usually from service causes), ", "(ii) as old age retirement or disability benefits for civilian employees, and (iii) as social security payments for the aged, disabled, or deceased citizens made in accordance with the rules governing social service programmes of the country. Pensions under the first head are of great antiquity. Under the second head they have been in force in one form or another in some countries for over a century but those coming under the third head are relatively of recent origin, though they are of the greatest magnitude. There are other views about pensions such as charity, paternalism, deferred pay, rewards for service rendered, or as a means or promoting general welfare (see Encyclopaedia Britannica, Vol. 17 p.575.) But these views have become otiose. ", "Pension to civil employees of the and the defence personnel as administered in India appear to be a compensation for service rendered in the past. However, as held in v. ) a pension is closely akin to wages in that it consists of payment provided by an employer, is paid in consideration of past service and serves the purpose of helping the recipient meet the expenses of living. This appears to be the nearest to our approach to pension with the added qualification that it should ordinarily ensure freedom from undeserved want. ", "Summing-up it can be said with confidence that pension is not only compensation for loyal service rendered in the past, but pension also has a broader significance, in that it is a measure of socio-economic justice which inheres economic security in the fall of life when physical and mental prowess is ebbing corresponding to aging process and therefore, one is required to fall back on savings. One such saving in kind is when you gave your best in the hey-day of life to your employer, in days of invalidity, economic security by way of periodical payment is assured. The term has been judicially defined as a stated allowance or stipend made in consideration of past service or a surrender of rights or emoluments to one retired from service. Thus the pension payable to a employee is earned by rendering long and efficient service and therefore can be said to be a deferred portion of the compensation or for service rendered. In one sentence one can say that the most practical raison d'etre for pension is the inability to provide for oneself due to old age. One may live and avoid unemployment but not senility and penury if there is nothing to fall back upon. ", "The discernible purpose thus underlying pension scheme or a statute introducing the pension scheme must inform interpretative process and accordingly it should receive a liberal construction and the courts may not so interpret such statute as to render them inane (see American Jurisprudence 2d. 881). ", "186 ", "From the discussion three things emerge : (i) that pension is neither a bounty nor a matter of grace depending upon the sweet will of the employer and that it creates a vested right subject to 1972 rules which are statutory in character because they are enacted in exercise of powers conferred by the proviso to Art. 309 and clause (5) of Art. 148 of the Constitution ; (ii) that the pension is not an ex-gratia payment but it is a payment for the past service rendered ; and (iii) it is a social welfare measure rendering socio-economic justice to those who in the hey-day of their life ceaselessly toiled for the employer on an assurance that in their old age they would not be left in lurch. It must also be noticed that the quantum of pension is a certain percentage correlated to the average emoluments drawn during last three years of service reduced to ten months under liberalised pension scheme. Its payment is dependent upon an additional condition of impeccable behaviour even subsequent to requirement, that is, since the cessation of the contract of service and that it can be reduced or withdrawn as a disciplinary measure. ", "Having succinctly focussed our attention on the conspectus of elements and incidents of pension the main question may now be tackled. But, the approach of court while considering such measure is of paramount importance. Since the advent of the Constitution, the state action must be directed towards attaining the goals set out in Part IV of the Constitution which, when achieved, would permit us to claim that we have set up a welfare . Article 38 (1) enjoins the to strive to promote welfare of the people by securing and protecting as effective as it may a social order in which justice social, economic and political shall inform all institutions of the national life. In particular the shall strive to minimise the inequalities in income and endeavour to eliminate inequalities in status, facilities and opportunities. Art. 39 (d) enjoins a duty to see that there is equal pay for equal work for both men and women and this directive should be understood and interpreted in the light of the judgment of this in .(1) Revealing the scope and content of this facet of equality, , J. speaking for the observed as under : ", "\"Now, thanks to the rising social and political consciousness and the expectations aroused as a consequence and the forward looking posture of this , the under- ", "187 ", "privileged also are clamouring for the rights and are seeking the intervention of the with touching faith and confidence in the . The Judges of the have a duty to redeem their Constitutional oath and do justice no less to the pavement dweller than to the guest of .\" ", "Proceeding further, this Court observed that where all relevant considerations are the same, persons holding identical posts may not be treated differently in the matter of their pay merely because they belong to different departments. If that can't be done when they are in service, can that be done during their retirement? Expanding this principle, one can confidently say that if pensioners form a class, their computation cannot be by different formula affording unequal treatment solely on the ground that some retired earlier and some retired later. Art. 39 (e) requires the to secure that the health and strength of workers, men and women, and children of tender age are not abused and that citizens are not forced by economic necessity to enter avocations unsuited to their age or strength. Art. 41 obligates the within the limits of its economic capacity and development, to make effective provision for securing the right to work, to education and to provide assistance in cases of unemployment, old age, sickness and disablement, and in other cases of undeserved want. Art. 43 (3) requires the to endeavour to secure amongst other things full enjoyment of leisure and social and cultural opportunities. ", "Recall at this stage the Preamble, the flood light illuminating the path to be pursued by the State to set up a Sovereign Socialist Secular Democratic Republic. Expression 'socialist' was intentionally introduced in the Preamble by the Constitution (Forty-Second Amendment) Act, 1976. In the objects and reasons for amendment amongst other things, ushering in of socio-economic revolution was promised. The clarion call may be extracted : ", "\"The question of amending the Constitution for removing the difficulties which have arisen in achieving the objective of socio-economic revolution, which would end poverty and ignorance and disease and inequality of opportunity, has been engaging the active attention of Government and the public for some time......... ", "188 ", "It is, therefore, proposed to amend the Constitution to spell out expressly the high ideals of socialism........to make the directive principles more comprehensive......\" ", "What does a Socialist Republic imply? Socialism is a much misunderstood word. Values determine contemporary socialism pure and simple. But it is not necessary at this stage to go into all its ramifications. The principal aim of a socialist is to eliminate inequality in income and status and standards of life. The basic framework of socialism is to provide a decent standard of life to the working people and especially provide security from cradle to grave. This amongst others on economic side envisaged economic equality and equitable distribution of income. This is a blend of Marxism and Gandhism leaning heavily towards Gandhian socialism. During the formative years, socialism aims at providing all opportunities for pursuing the educational activity. For want of wherewithal or financial equipment the opportunity to be fully educated shall not be denied. Ordinarily, therefore, a socialist provides for free education from primary to Ph. D. but the pursuit must be by those who have the necessary intelligence quotient and not as in our society where a brainy young man coming from a poor family will not be able to prosecute the education for want of wherewithal while the ill-equipped son or daughter of a well-to-do father will enter the portals of higher education and contribute to national wastage. After the education is completed, socialism aims at equality in pursuit of excellence in the chosen avocation without let or hindrance of caste, colour, sex or religion and with full opportunity to reach the top not thwarted by any considerations of status, social or otherwise. But even here the less equipped person shall be assured a decent minimum standard of life and exploitation in any form shall be eschewed. There will be equitable distribution of national cake and the worst off shall be treated in such a manner as to push them up the ladder. Then comes the old age in the life of everyone, be he a monarch or a , a worker or a pariah. The old age overtakes each one, death being the fulfilment of life providing freedom from bondage. But there socialism aims at providing an economic security to those who have rendered unto society what they were capable of doing when they were fully equipped with their mental and physical prowess. In the fall of life the shall ensure to the citizens a reasonably decent standard of life, medical aid, freedom from want, freedom from fear and the enjoyable leisure, relieving the boredom and the humility of dependence in old age. This is what Art. 41 aims when it enjoins the to secure public assistance in old age, sickness and disablement. It was such a socialist which the Preamble directs the centres of power and -to strive to set up. From a wholly feudal exploited slave society to a vibrant, throbbing socialist welfare society is a long march but during this journey to the fulfilment of goal every action whenever taken must be directed, and must be so interpreted, as to take the society one step towards the goal. ", "To some extent this approach will find support in the judgment in .(1). Speaking for the majority, , C.J. observed as under : ", "\"This is not mere semantics. The edifice of our Constitution is built upon the concepts crystallised in the Preamble. We resolved to constitute ourselves into a Socialist which carried with it the obligation to secure to our people justice-social, economic and political. We, therefore, put Part IV into our Constitution containing directive principles of policy which specify the socialistic goal to be achieved.\" ", "At a later stage it was observed that the fundamental rights are not an end in themselves but are the means to an end, the end is specified in part IV. , J. in his minority judgment after extracting a portion of the speech of the then Prime Minister , while participating in a discussion on the Constitution (First Amendment) Bill, observed that the Directive Principles are intended to bring about a socio-economic revolution and to create a new socio-economic order where there will be social and economic justice for all and everyone, not only a fortunate few but the teeming millions of India, would be able to participate in the fruits of freedom and development and exercise the fundamental rights. It, therefore, appears to be well established that while interpreting or examining the constitutional validity of legislative/administrative action, the touchstone of Directive Principles of State Policy in the light of the Preamble will provide a reliable yardstick to hold one way or the other. ", "190 ", "With this background let us now turn to the challenge posed in these petitions. The challenge is not to the validity of the pension liberalisation scheme. The scheme is wholly acceptable to the petitioners, nay they are ardent supporters of it, nay further they seek the benefit of it. The petitioners challenge only that part of the scheme by which its benefits are admissible to those who retired from service after a certain date. In other words, they challenge that the scheme must be uniformly enforced with regard to all pensioners for the purpose of computation of pension irrespective of the date when the servant retired subject to the only condition that he was governed by the 1972 Rules. No doubt, the benefit of the scheme will be available from the specified date, irrespective of the fact when the concerned servant actually retired from service. ", "Having set out clearly the society which we propose to set up, the direction in which the State action must move, the welfare State which we propose to build up, the constitutional goal of setting up a socialist State and the assurance in the Directive Principles of State Policy especially of security in old age at least to those who have rendered useful service during their active years, it is indisputable, nor was it questioned, that pension as a retirement benefit is in consonance with and furtherance of the goals of the Constitution. The goals for which pension is paid themselves give a fillip and push to the policy of setting up a welfare State because by pension the socialist goal of security of cradle to grave is assured at least when it is mostly needed and least available, namely, in the fall of life. ", "If such be the goals of pension, if such be the welfare which we propose to set up, if such be the goals of socialism and conceding that any welfare measure may consistent with economic capacity of the be progressively augmented with wider width and a longer canvass yet when the economic means permit the augmentation, should some be left out for the sole reason that while in the formative years of the nascent they contributed their mite but when the fruits of their labour led to the flowering of economic development and higher gross national produce bringing in larger revenue and therefore larger cake is available, they would be denied any share of it ? Indisputably, viewed from any angle pensioners for payment of pension form a class. Unquestionably pension is linked to length of service and the last pay drawn but the last pay does not imply the pay on the last day of retirement but average emoluments as defined in the scheme. Earlier average emoluments of 36 months' service provided the measure of pension because the pension was related to the average emoluments during 36 months just preceding retirement. By the liberalised scheme it is now reduced to average emoluments of 10 months preceding the date. Any one in government service would appreciate at a glance that with an average of 10 months it would be on the higher side on account of the two fortuitous circumstances that the pay- scales, if one has not reached the maximum, permit annual increments and there are promotions in the last one or two years. With a view to giving a higher average the scheme was liberalised to provide for average emoluments with reference to last 10 months' service. Coupled with it, a slab system for computation is introduced and the ceiling is raised. This is liberalisation. Now, if the pensioners who retired prior to the specified date and had to earn pension on the average emoluments of 36 months' salary just preceding the date of retirement, naturally the average would be lower and they will be doubly hit because the slab system as now introduced was not available and the ceiling was at a lower level. Thus they suffer triple jeopardy, viz., lower average emoluments, absence of slab system and lower ceiling. ", "What then is the purpose in prescribing the specified date vertically dividing the pensioners between those who retired prior to the specified date and those who retire subsequent to that date? That poses the further question, why was the pension scheme liberalised ? What necessitated liberalisation of the pension scheme ? ", "Both the impugned memoranda do not spell out the raison d'etre for liberalising the pension formula. In the affidavit in opposition by , it has been stated that the liberalisation of pension of retiring servants was decided by the in view of the persistent demand of the Central employees represented in the scheme of . This would clearly imply that the preliberalised pension scheme did not provide adequate protection in old age and that a further liberalisation was necessary as a measure of economic security. When favourably responded to the demand it thereby ipso facto conceded that there was a larger available national cake part of which could be utilised for providing higher security to erstwhile government servants who would retire. The also took note of the fact that continuous upward movement of the cost of living index as a sequel of inflationary inputs and diminishing purchasing power of rupee necessitated upward revision of pension. If this be the underlying intendment of liberalisation of pension scheme, can any one be bold enough to assert that it was good enough only for those who would retire subsequent to the specified date but those who had already retired did not suffer the pangs of rising prices and falling purchasing power of the rupee ? What is the sum total of picture ? Earlier the scheme was not that liberal keeping in view the definition of average emoluments and the absence of slab system and a lower ceiling. Those who rendered the same service earned less pension and are exposed to the vagary of rising prices consequent upon the inflationary inputs. If therefore, those who are to retire subsequent to the specified date would feel the pangs in their old age, of lack of adequate security, by what stretch of imagination the same can be denied to those who retired earlier with lower emoluments and yet are exposed to the vagaries of the rising prices and the falling purchasing power of the rupee. And the greater misfortune is that they are becoming older and older compared to those who would be retiring subsequent to the specified date. The was perfectly justified in liberalising the pension scheme. In fact it was overdue. But we find no justification for arbitrarily selecting the criteria for eligibility for the benefits of the scheme dividing the pensioners all of whom would be retirees but falling on one or the other side of the specified date. ", "Therefore, let us proceed to examine whether there was any rationale behind the eligibility qualification. The learned Attorney-General contended that the scheme is one whole and that the date is an integral part of the scheme and the Government would have never enforced the scheme devoid of the date and the date is not severable from the scheme as a whole. Contended the learned Attorney-General that the does not take upon itself the function of legislation for persons, things or situations omitted by the legislature. It was said that when the legislature has expressly defined the class with clarity and precision to which the legislation applies, it would be outside the judicial function to enlarge the class and to do so is not to interpret but to legislate which is the forbidden field. Alternatively it was also contended that where a larger class comprising two smaller classes is covered by a legislation of which one part is constitutional, the examines whether the legislation must be invalidated as a whole or only in respect of the unconstitutional part. It was also said that severance always cuts down the scope of legislation but can never enlarge it and in the present case the scheme as it stands would not cover pensioners such as the petitioners and if by severance an attempt is made to include them in the scheme it is not cutting down the class or the scope but enlarge the ambit of the scheme which is impermissible even under the doctrine of severability. In this context it was lastly submitted that there is not a single case in India or elsewhere where the has included some category within the scope of provisions of a law to maintain its constitutionality. ", "The last submission, the absence of precedent need not deter us for a moment. Every new norm of socio economic justice, every new measure of social justice commenced for the first time at some point of history. If at that time it is rejected as being without a precedent, the law as an instrument of social engineering would have long since been dead and no tears would have been shed. To be pragmatic is not to be unconstitutional. In its onward march law as an institution ushers in socio-economic justice. In fact, in old age commended itself in earlier stages as a moral concept but in course of time it acquired legal contention. The rules of natural justice owed their origin to ethical and moral code. Is there any doubt that they have become the integral and inseparable parts of rule of law of which any civilised society is proud ? Can anyone be bold enough to assert that ethics and morality are outside the field of legal formulations ? Socio-economic justice stems from the concept of social morality coupled with abhorrence for economic exploitation. And the advancing society converts in course of time moral or ethical code into enforceable legal formulations. Over-emphasis on precedent furnishes an insurmountable road-block to the onward march towards promised millennium. An overdose of precedents is the bane of our system which is slowly getting stagnant, stratified and atrophied. Therefore absence of a precedent on this point need not deter us at all. We are all the more happy for the chance of scribbling on a clean slate. ", "If it appears to be undisputable, as it does to us that the pensioners for the purpose of pension benefits form a class, would its upward revision permit a homogeneous class to be divided by arbitrarily fixing an eligibility criteria unrelated to purpose of revision, and would such classification be founded on some rational principle ? The classification has to be based, as is well settled, on some rational principle and the rational principle must have nexus to the objects sought to be achieved. We have set out the objects underlying the payment of pension. If the considered it necessary to liberalise the pension scheme, we find no rational principle behind it for granting these benefits only to those who retired subsequent to that date simultaneously denying the same to those who retired prior to that date. If the liberalisation was considered necessary for augmenting social security in old age to government servants then those who retired earlier cannot be worst off than those who retire later. Therefore, this division which classified pensioners into two classes is not based on any rational principle and if the rational principle is the one of dividing pensioners with a view to giving something more to persons otherwise equally placed, it would be discriminatory. To illustrate, take two persons, one retired just a day prior and another a day just succeeding the specified date. Both were in the same pay bracket, the average emolument was the same and both had put in equal number of years of service. How does a fortuitous circumstance of retiring a day earlier or a day later will permit totally unequal treatment in the matter of pension ? One retiring a day earlier will have to be subject to ceiling of Rs. 8,100 p a. and average emolument to be worked out on 36 months' salary while the other will have a ceiling of Rs. 12,000 p.a. and average emolument will be computed on the basis of last ten months average. The artificial division stares into face and is unrelated to any principle and whatever principle, if there be any, has absolutely no nexus to the objects sought to be achieved by liberalising the pension scheme. In fact this arbitrary division has not only no nexus to the liberalised pension scheme but it is counter productive and runs counter to the whole gamut of pension scheme. The equal treatment guaranteed in Art. 14 is wholly violated inasmuch as the pension rules being statutory in character, since the specified date, the rules accord differential and discriminatory treatment to equals in the matter of commutation of pension. A 48 hours difference in matter of retirement would have a traumatic effect. Division is thus both arbitrary and unprincipled. Therefore the classification does not stand the test of Art. ", "14. Further the classification is wholly arbitrary because we do not find a single acceptable or persuasive reason for this division. This arbitrary action violated the guarantee of Art. 14. The next question is what is the way you ? ", "195 ", "The learned Attorney-General contended that the scheme is to be taken as a whole or rejected as a whole and the date from which it came into force is an integral and inseparable part of the scheme. The two sub-limbs of the submissions were that, (i) the cannot make a scheme having financial implications retroactive, and (ii) this cannot grant any relief to the pensioners who retired prior to a specified date because if more persons divide the available cake, the residue falling to the share of each especially to those who are likely to be benefited by the scheme will be comparatively smaller and as they are not before the , no relief can be given to the pensioners. ", "Let us clear one misconception. The pension scheme including the liberalised scheme available to the employees is non-contributory in character. It was not pointed out that there is something like a pension fund. It is recognised as an item of expenditure and it is budgeted and voted every year. At any given point of time there is no fixed or predetermined pension fund which is divided amongst eligible pensioners. There is no artificially created fund or reservoir from which pensioners draw pension within the limits of the fund, the share of each being extensive with the available fund. The payment of pension is a statutory liability undertaken by the and whatever becomes due and payable is budgeted for. One could have appreciated this line of reasoning where there is a contributory scheme and a pension fund from which alone pension is disbursed. That being not the case, there is no question of pensioners dividing the pension fund which, if more persons are admitted to the scheme, would pro rata affect the share. Therefore, there is no question of dividing the pension fund. Pension is a liability incurred and has to be provided for in the budget. Therefore, the argument of divisions of a cake, larger the number of sharers, smaller the share and absence of residue and therefore by augmentation of beneficiaries, pro rata share is likely to be affected and their absence making relief impermissible, is an argument born of desperation, and is without merits and must be rejected as untenable. ", "By our approach, are we making the scheme retroactive ? The answer is emphatically in the negative. Take a government servant who retired on April 1, 1979. He would be governed by the liberalised pension scheme. By that time he had put in qualifying service of 35 years. His length of service is a relevant factor for computation of pension. Has the made it retroactive, 35 years backward compared to the case of a servant who retired on 30th March, 1979 ? Concept of qualifying service takes note of length of service, and pension quantum is correlated to qualifying service. Is it retroactive for 35 years for one and not retroactive for a person who retired two days earlier ? It must be remembered that pension is relatable to qualifying service. It has correlation to the average emoluments and the length of service. Any liberalisation would pro tanto be retroactive in the narrow sense of the term. Otherwise it is always prospective. A statute is not properly called a retroactive statute because a part of the requisites for its action is drawn from a time antecedent to its passing. (see Craies on Statute Law, sixth edition, p. ", "387). Assuming the had not prescribed the specified date and thereby provided that those retiring pre and post the specified date would all be governed by the liberalised pension scheme, undoubtedly, it would be both prospective and retroactive. Only the pension will have to be recomputed in the light of the formula enacted in the liberalised pension scheme and effective from the date the revised scheme comes into force. And beware that it is not a new scheme, it is only a revision of existing scheme. It is not a new retiral benefit. It is an upward revision of an existing benefit. If it was a wholly new concept, a new retiral benefit, one could have appreciated an argument that those who had already retired could not expect it. It could have been urged that it is an incentive to attract the fresh recruits. Pension is a reward for past service. It is undoubtedly a condition of service but not an incentive to attract new entrants because if it was to be available to new entrants only, it would be prospective at such distance of thirty-five years since its introduction. But it covers all those in service who entered thirty-five years back. Pension is thus not an incentive but a reward for past service. And a revision of an existing benefit stands on a different footing than a new retiral benefit. And even in case of new retiral benefit of gratuity under the Payment of Gratuity Act , 1972 past service was taken into consideration. Recall at this stage the method adopted when pay-scales are revised. Revised pay-scales are introduced from a certain date. All existing employees are brought on to the revised scales by adopting a theory of fitments and increments for past service. In other words, benefit of revised scale is not limited to those who enter service subsequent to the date fixed for introducing revised scales but the benefit is extended to all those in service prior to that date. This is just and fair. Now if pension as we view it, is some kind of retirement wages for past service, can it be denied to those who retired earlier, revised retirement benefits being available to future retirees only ? Therefore, there is no substance in the contention that the court by its approach would be making the scheme retroactive, because it is implicit in theory of wages. ", "That takes us to the last important contention of the learned Attorney General. It was urged that the date from which the scheme becomes operative is an integral part of the scheme and the doctrine of severability cannot be invoked. In other words, it was urged that date cannot be severed from the main object of the scheme because the Government would have never offered the scheme unless the date was an integral part of it. Undoubtedly when an upward revision is introduced, a date from which it becomes effective has to be provided. It is the event of retirement subsequent to the specified date which introduces discrimination in one otherwise homogeneous class of pensioners. This arbitrary selection of the happening of event subsequent to specified date denies equality of treatment to persons belonging to the same class, some preferred and some omitted. Is this eligibility qualification severable ? ", "It was very seriously contended, remove the event correlated to date and examine whether the scheme is workable. We find no difficulty in implementing the scheme omitting the event happening after the specified date retaining the more humane formula for computation of pension. It would apply to all existing pensioners and future pensioners. In the case of existing pensioners, the pension will have to be recomputed by applying the rule of average emoluments as set out in Rule 34 and introducing the slab system and the amount worked out within the floor and the ceiling. ", "But we make it abundantly clear that arrears are not required to be made because to that extent the scheme is prospective. All pensioners whenever they retired would be covered by the liberalised pension scheme, because the scheme is a scheme for payment of pension to a pensioner governed by 1972 Rules. The date of retirement is irrelevant. But the revised scheme would be operative from the date mentioned in the scheme and would bring under its umbrella all existing pensioners and those who retired subsequent to that date. In case of pensioners who retired prior to the specified date, their pension would be computed afresh and would be payable in future commencing from the specified date. No arrears would be payable. And that would take care of the grievance of retrospectivity. In our opinion, it would make a marginal difference in the case of past pensioners because the emoluments are not revised. The last revision of emoluments was as per the recommendation of (). If the emoluments remain the same, the computation of average emoluments under amended Rule 34 may raise the average emoluments, the period for averaging being reduced from last 36 months to last 10 months. The slab will provide slightly higher pension and if someone reaches the maximum the old lower ceiling will not deny him what is otherwise justly due on computation. The words \"who were in service on 31st March, 1979 and retiring from service on or after the date\" excluding the date for commencement of revision are words of limitation introducing the mischief and are vulnerable as denying equality and introducing an arbitrary fortuitous circumstance can be severed without impairing the formula. Therefore, there is absolutely no difficulty in removing the arbitrary and discriminatory portion of the scheme and it can be easily severed. ", "There is nothing immutable about the choosing of an event as an eligibility criteria subsequent to a specified date. If the event is certain but its occurrence at a point of time is considered wholly irrelevant and arbitrarily selected having no rationale for selecting it and having an undesirable effect of dividing homogeneous class and of introducing the discrimination, the same can be easily severed and set aside. While examining the case under Art. 14 , the approach is not: 'either take it or leave it', the approach is removal of arbitrariness and if that can be brought about by severing the mischievous portion the court ought to remove the discriminatory part retaining the beneficial portion. The pensioners do not challenge the liberalised pension scheme. They seek the benefit of it. Their grievance is of the denial to them of the same by arbitrary introduction of words of limitation and we find no difficulty in severing and quashing the same. This approach can be legitimised on the ground that every servant retires. grants upward revision of pension undoubtedly from a date. Event has occurred revision has been earned. Date is merely to avoid payment of arrears which may impose a heavy burden. If the date is wholly removed, revised pensions will have to be paid from the actual date of retirement of each pensioner. That is impermissible. The cannot be burdened with arrears commencing from the date of retirement of each pensioner. But effective from the specified date future pension of earlier retired servants can be computed and paid on the analogy of fitments in revised pay-scales becoming prospectively operative. That removes the nefarious unconstitutional part and retains the beneficial portion. It does not adversely affect future pensioners and their presence in the petitions becomes irrelevant. But before we do so, we must look into the reasons assigned for eligibility criteria, namely, 'in service on the specified date and retiring after that date'. The only reason we could find in affidavit of is the following statement in paragraph 5 : ", "\"The date of effect of the impugned orders has been selected on the basis of relevant and valid considerations.\" ", "We repeatedly posed a question: what are those relevant and valid considerations and waited for the answer in vain. We say so because in the written submissions filed on behalf of , we find not a single valid or relevant consideration much less any consideration relevant to selection of eligibility criteria. The tenor is \"we select the date and it is unquestionable; either take it or leave it as a whole\". The only submission was that the date is not severable and some submissions in support of it. ", "Having examined the matter on principle, let us turn to some precedents. (1) the appellant questioned his seniority which was to be determined in accordance with the provisions contained in (Regulation of Seniority) Rules, 1954. These rules required first to ascertain the year of allotment of the person concerned for the determination of his seniority. In doing so, directed that officers promoted to the should be allowed the benefit of their continuous officiation with effect only from 19th May, 1951. The appellant challenged the order because the period of officiation from June 1947 to May 1951 was excluded for the purpose of fixation of his seniority. His grievance was that there was no rationale behind selecting this date. After taking into consideration affidavit in opposition, this Court held as under : ", "\"It would be noticed that the date, May 19, 1951, to begin with had nothing to do with the finalisation of the Gradation List of because it was a date which had reference to the finalisation of the Gradation List for the . Further this date does not seem to have much relevance to the question of avoiding the anomalous position mentioned in para 9 of the affidavit reproduced above. This date was apparently chosen for the because on this date the Gradation List for all the earlier persons recruited to the service had been finalised and issued in a somewhat stable stage. But why should this date be applied to has not been adequately explained. Mr. , the learned counsel for the appellant, strongly urges that selection of May 19, 1951, as a crucial date for classifying people is arbitrary and irrational. We agree with him in this respect. It further appears from the affidavit of Mr. , Deputy Secretary to , , dated December 9, 1966 that \" have recently decided in consultation with that the letter No. 2/32/51-AIS, dated the 25th August, 1955 will not be applicable to those SCS/SPS officers, who were appointed to /IPS prior to the promulgation of /IPS (Regulation of Seniority) Rules, 1954, and the date of the issue of the above letter if their earlier continuous officiation was approved by the and \". It further appears that \"in the case of Shri also, an IPS Officer of Bihar, a decision has been taken to give the benefit of full continuous officiation in senior posts and to revise his year of allotment accordingly.\" But, it is stated that \"as Shri was appointed to IPS on the 22nd October 1955, i.e. after the promulgation of IPS (Regulation of Seniority) Rules, 1954, and after the issue of letter dated 25.8.1955, his case does not fall even under this category\". The above statement of the case of the further shows that the date, May 19, 1951 was an artificial and arbitrary date having nothing to do with the application of the first and the second provisos to Rule 3 (3). It appears to us that under the second proviso to Rule 3 (3) the period of officiation of a particular officer has to be considered and approved or disapproved by the Central in consultation with the considering all the relevant facts. The Central cannot pick out a date from a hat-and that is what it seems to have done in this case-and say that a period prior to that date would not be deemed to be approved by the Central within the second proviso.\" ", "The Court held that cannot pick out a date from a hat and that is what it seems to have done in saying that a period prior to that date would not be deemed to be approved by within the second proviso. In case before us, the eligibility criteria for being eligible for liberalised pension scheme have been picked out from where it is difficult to gather and no rationale is discernible nor one was attempted at the hearing. The ratio of the decision would squarely apply to the facts of this case. ", "Similarly in .(1), this Court struck down as discriminatory the division of pre-1955 and post-1955 tenants for the purpose of allotment of land made by the Rules under the Rajasthan Colonisation Act, 1954 observing that the various provisions indicate that the pre-1955 and post-1955 tenants stand on the same footing and therefore do not form different classes and hence the division was held to be based on wholly irrelevant consideration. The court further observed that it is difficult to appreciate how it would make any difference from the point of view of allotment of land, whether a tenant has been in occupation for 16 years or 18 or 20 years and why differentiation should be made with reference to the date when Rajasthan Tenancy Act came into force. This division for the purpose of allotment of land with reference to certain date was considered both arbitrary and discriminatory on the ground that it was wholly unrelated to the objects sought to be achieved. ", "As against this the learned Attorney-General invited our attention to etc.(2) By a notification dated July 21, 1967, benefit of a concessional rate of duty was made available if a manufacturer of matches made a declaration that the total clearance of matches from a factory would not exceed 75 million during a financial year. As framed the notification extended the benefit to manufacturers with higher capacity to avail of the concessional rate of duty by filing a declaration as visualised in the proviso to the notification by restricting their clearance to 75 million matches. This notification was amended on September 4, 1967 with a view to giving bona fide small manufacturers, whose total clearance was not estimated to be in excess of 75 million matches, the benefit of concessional rate of duty prescribed under notification dated July 21, 1967. The respondent in the case applied for a licence for manufacturing matches on September 5, 1967, that is, a day after the date on which amended notification was issued and filed a declaration that the estimated manufacture for the financial year would not exceed 75 million matches, but this was rejected. In a writ petition filed by the respondent, held that the classification was unreasonable inasmuch as the fixation of the date for making a declaration had no nexus with the object of the Act. In the appeal by , this held that the concessional rate of duty was intended for small bona fide units who were in the field when the notification dated September 4, 1967 was issued. The concessional rate of duty was not intended to benefit the large units which had split up into smaller units to earn the concession. With reference to selection of the date this observed as under : ", "\"The choice of a date as a basis for classification cannot always be dubbed as arbitrary even if no particular reason is forthcoming for the choice unless it is shown to be capricious or whimsical in the circumstances. When it is seen that a line or a point there must be and there is no mathematical or logical way of fixing it precisely, the decision of the legislature or its delegate must be accepted unless we can say that it is very wide of the reasonable mark.\" ", "In reaching this conclusion the relied on v. (1) This decision is not an authority for the proposition that whenever a date is chosen, or an eligibility criteria which divides a class, the purpose of choice unrelated to the objects sought to be achieved must be accepted as valid. In fact it is made clear in the decision itself that even if no particular reason is forthcoming for the choice unless it is shown to be capricious or whimsical, the choice of the legislature may be accepted. Therefore, the choice of the date cannot be wholly divorced from the objects sought to be achieved by the impugned action. In other words, if the choice is shown to be thoroughly arbitrary and introduces discrimination violative of Art. 14 , the date can be struck down. What facts influenced the 's decision in that case for upholding the choice of the date are worth- recalling. The held that the object of granting the concessional rate of duty was to protect the smaller units in the industry from the competition by the larger ones and that object would have been frustrated, if, by adopting the device of fragmentation, the larger units could become the ultimate beneficiaries of the bounty. This was the weighty consideration which prompted the court to uphold the date. ", "The learned Attorney General next referred to . v. State of Kerala & Anr. etc. (1) This Court while repelling the contention that the choice of April 1, 1973 as the date of imposition of the building tax is discriminatory with reference to Art. 14 of the Constitution, approved the ratio in the case of M/s. Parameswaran Match Works etc. supra. Even while reaching this conclusion the Court observed that it is not shown how it could be said that the date (April 1, 1973) for the levy of the tax was wide of the reasonable mark. What appealed to the Court was that earlier an attempt was made to impose the building tax with effect from March 2, 1961 under the Kerala Building Tax Act, 1961 but the Act was finally struck down as unconstitutional by this Court as per its decision dated August 13, 1968. While delivering the budget speech, at the time of introduction of the 1970-71 budget, the intention to introduce a fresh Bill for the levy of tax was made clear. The Bill was published in June 73 in which it was made clear that the Act would be brought into force from April 1, 1970. After recalling the various stages through which the Bill passed before being enacted as Act, this Court held that the choice of date April 1, 1973 was not wide of the reasonable mark. The decision proceeds on the facts of the case. But the principle that when a certain date or eligibility criteria is selected with reference to legislative or executive measure which has the pernicious tendency of dividing an otherwise homogeneous class and the choice of beneficiaries of the legislative/executive action becomes selective, the division or classification made by choice of date or eligibility criteria must have some relation to the objects sought to be achieved. And apart from the first test that the division must be referable to some rational principle, if the choice of the date or classification is wholly unrelated to the objects sought to be achieved, it cannot be upheld on the specious plea that was the choice of the . ", "Now if the choice of date is arbitrary, eligibility criteria is unrelated to the object sought to be achieved and has the pernicious tendency of dividing an otherwise homogeneous class, the question is whether the liberalised pension scheme must wholly fail or that the pernicious part can be severed, cautioning itself that this does not legislate but merely interprets keeping in view the underlying intention and the object, the impugned measure seeks to subserve ? Even though it is not possible to oversimplify the issue, let us read the impugned memoranda deleting the unconstitutional part. Omitting it, the memoranda will read like this : ", "\"At present, pension is calculated at the rate of 1/80th of average emoluments for each completed year of service and is subject to a maximum of 33/80 of average emoluments and is further restricted to a monetary limit of Rs. 1,000/- per month. The President is, now, pleased to decide that with effect from 31st March, 1979 the amount of pension shall be determined in accordance with the following slabs.\" ", "If from the impugned memoranda the event of being in service and retiring subsequent to specified date is severed, all pensioners would be governed by the liberalised pension scheme. The pension will have to be recomputed in accordance with the provisions of the liberalised pension scheme as salaries were required to be recomputed in accordance with the recommendation of but becoming operative from the specified date. It does therefore appear that the reading down of impugned memoranda by severing the objectionable portion would not render the liberalised pension scheme vague, unenforceable or unworkable. ", "In reading down the memoranda, is this legislating ? Of course 'not'. When we delete basis of classification as violative of Art. 14 , we merely set at naught the unconstitutional portion retaining the constitutional portion. ", "205 ", "We may now deal with the last submission of the learned Attorney General on the point. Said the learned Attorney- General that principle of severability cannot be applied to augment the class and to adopt his words 'severance always cuts down the scope, never enlarges it'. We are not sure whether there is any principle which inhibits the from striking down an unconstitutional part of a legislative action which may have the tendency to enlarge the width and coverage of the measure. Whenever classification is held to be impermissible and the measure can be retained by removing the unconstitutional portion of classification, by striking down words of limitation, the resultant effect may be of enlarging the class. In such a situation, the can strike down the words of limitation in an enactment. That is what is called reading down the measure. We know of no principle that 'severance' limits the scope of legislation and can never enlarge it. To refer to case (supra), when for the benefit of allotment of land the artificial division between pre-1955 and post-1955 tenant was struck down by this , the class of beneficiaries was enlarged and the cake in the form of available land was a fixed quantum and its distribution amongst the larger class would protanto reduce the quantum to each beneficiary included in the class. Similarly when this in case (supra) held that the principle of 'equal pay for equal work' may be properly applied to cases of unequal pay based on no classification or irrational classification it enlarged the class of beneficiaries. Therefore, the principle of 'severance' for taking out the unconstitutional provision from an otherwise constitutional measure has been well recognised. It would be just and proper that the provision in the memoranda while retaining the date for its implementation, but providing 'that in respect of Government servants who were in service on the 31st March, 1979 but retiring from service in or after that date' can be legally and validly severed and must be struck down. The date is retained without qualification as the effective date for implementation of scheme, it being made abundantly clear that in respect of all pensioners governed by 1972 Rules, the pension of each may be recomputed as on April 1, 1979 and future payments be made in accordance with fresh computation under the liberalised pension scheme as enacted in the impugned memoranda. No arrears for the period prior to 31st March, 1979 in accordance with revised computation need be paid. ", "In this context the last submission of the learned Attorney General was that as the pension is always correlated to the date of retirement, the cannot change the date of retirement, and impose fresh commutation benefit. We are doing nothing of this kind. The apprehension is wholly unfounded. The date of retirement of each employee remains as it is. The average emoluments have to be worked out keeping in view the emoluments drawn by him before retirement but in accordance with the principles of the liberalised pension scheme. The two features which make the liberalised pension scheme more attractive is the redefining of average emoluments in Rule 34, and introduction of slab system simultaneously raising the ceiling. Within these parameters, the pension will have to be recomputed with effect from the date from which the liberalised pension scheme came into force i.e. March 31, 1979. There is no question of fresh commutation of pension of the pensioners who retired prior to 31st March, 1979 and have already availed of the benefit of commutation. It is not open to them to get that benefit at this late date because commutation has to be availed of within specified time limit from the date of actual retirement. May be some marginal retirees may earn the benefit. That is inevitable. To say that by our approach we are restructuring the liberalised pension scheme, is to ignore the constitutional mandate. Similarly, the court is not conferring benefits by this approach, the court only removes the illegitimate classification and after its removal the law takes its own course. ", "But in this context the learned Attorney submitted the following quotation which appears to have been extracted from a decision of , citation of which was not available. The quotation may be extracted from the written submission. It reads as under: ", "\"It remains to enquire whether this plea that would have enacted the legislation and the Act being limited to employees engaged in commerce within the district of Columbia and the Territory. If we are satisfied that it would not or that the matter is in such doubt that we are unable to say what would have done omitting the unconstitutional features then the statute must fail.\" ", "We entertain no such apprehension. The with parliamentary mandate liberalised the pension scheme. It is implicit in liberalising the scheme that the deed to grant little higher rate of pension to the pensioners was considered eminently just. One could have understood persons in the higher pay bracket being excluded from the benefits of the scheme because it would have meant that those in higher pay bracket could fend for themselves. Such is not the exclusion. The exclusion is of a whole class of people who retire before a certain date. would not have hesitated to extend the benefit otherwise considered eminently just, and this becomes clearly discernible from page 35 of 9th Report of Committee on Petitions (Sixth ) April, 1976. While examining their representation for better pensionary benefit, the Committee concluded as under: ", "\"The Committee are of the view that Government owe a moral responsibility to provide adequate relief to its retired employees including pre 1.1.1973 pensioners, whose actual value of pensions has been eroded by the phenomenal rise in the prices of essential commodities. In view of the present economic conditions in India and constant rise in the cost of living due to inflation, it is all the more important even from purely humanitarian considerations if not from the stand point of fairness and justice, to protect the actual value of their meagre pensions to enable the pensioners to live in their declining years with dignity and in reasonable comfort.\" ", "Therefore, we are not inclined to share the apprehension voiced by the learned Attorney that if we strike down the unconstitutional part, the parliament would not have enacted the measure. Our approach may have a parliamentary flavour to sensitive noses. ", "The financial implication in such matters has some relevance. However in this connection, we want to steer clear of a misconception. There is no pension fund as it is found either in contributory pension schemes administered in foreign countries or as in Insurance-linked pensions. Non- contributory pensions under 1972 rules is a obligation. It is an item of expenditure voted year to pear depending upon the number of pensioners and the estimated expenditure. Now when the liberalised pension scheme was introduced, we would justifiably assume that the Government servants would retire from the next day of the coming into operation of the scheme and the burden will have to be computed as imposed by the liberalised scheme. Further Government has been granting since nearly a decade temporary increases from time to time to pensioners. Therefore, the difference will be marginal. ", "208 ", "Further, let it not be forgotten that the old pensioners are on the way out and their number is fast decreasing. While examining the financial implication, this Court is only concerned with the additional liability that may be imposed by bringing in pensioners who retired prior to April 1, 1979 within the fold of liberalised pension scheme but effective subsequent to the specified date. That it is a dwindling number is indisputable. And again the large bulk comprises pensioners from lower echelons of service such as , , , Assistant etc. In a chart submitted to us, has worked out the pension to the pensioners who have retired prior to the specified date and the comparative advantage, if they are brought within the purview of the liberalised pension scheme. The difference upto the level of Assistant or even Section Officer is marginal keeping in view that the old pensioners are getting temporary increases. Amongst the higher officers, there will be some difference because the ceiling is raised and that would introduce the difference. It is however necessary to refer to one figure relied upon by respondents. It was said that if pensioners who retired prior to 31st March, 1979 are brought within the purview of the liberalised pension scheme, Rs. 233 crores would be required for fresh commutation. The apparent fallacy in the submission is that if the benefit of commutation is already availed of, it cannot and need not be reopened. And availability of other benefits is hardly a relevant factor because pension is admissible to all retirees. The figures submitted are thus neither frightening nor the liability is supposed to be staggering which would deflect us from going to the logical end of constitutional mandate. Even according to the most liberal estimate, the average yearly increase is worked out to be Rs. 51 crores but that assumes that every pensioner has survived till date and will continue to survive. Therefore, we are satisfied that the increased liability consequent upon this judgment is not too high to be unbearable or such as would have detracted the from covering the old pensioners under the scheme. ", "Locus standi of third petitioner was questioned. Petitioner No. 3 is a registered under the Societies Registration Act of 1860. It is a non-political non-profit and voluntary organisation. Its members consist of public spirited citizens who have taken up the cause of ventilating legitimate public problems. This received a large number of representations from old pensioners, individually unable to undertake the journey through labyrinths of legal judicial process, costly and protracted, and. therefore, approached petitioner No. 3 which espoused their cause Objects for which the third petitioner- was formed were not questioned. The majority decision of this Court in (1) rules that any member of the public having sufficient interest can maintain an action for judicial redress for public injury arising from breach of public duty or from violation of some provision of the Constitution or the law and seek enforcement of such public duty and observance of such constitutional or legal provision. Third petitioner seeks to enforce rights that may be available to a large number of old infirm retirees. Therefore, its locus standi is unquestionable. But it is a point of academic important because locus standi of petitioners Nos. 1 and 2 was never questioned. ", "That is the end of the journey. With the expanding horizons of socio-economic justice, the socialist Republic and welfare State which we endeavour to set up and largely influenced by the fact that the old men who retired when emoluments were comparatively low and are exposed to vagaries of continuously rising prices, the falling value of the rupee consequent upon inflationary inputs, we are satisfied that by introducing an arbitrary eligibility criteria: 'being in service and retiring subsequent to the specified date' for being eligible for the liberalised pension scheme and thereby dividing a homogeneous class, the classification being not based on any discernible rational principle and having been found wholly unrelated to the objects sought to be achieved by grant of liberalised pension and the eligibility criteria devised being thoroughly arbitrary, we are of the view that the eligibility for liberalised pension scheme of being in service on the specified date and retiring subsequent to that date' in impugned memoranda, Exhibits P-I and P-2, violates Art. 14 and is unconstitutional and is struck down. Both the memoranda shall be enforced and implemented as read down as under: In other words, in Exhibit P-1, the words: ", "\"that in respect of the Government servants who were in service on the 31st March, 1979 and retiring from service on or after that date\" ", "210 ", "and in Exhibit P-2, the words: ", "\"the new rates of pension are effective from 1st April 1979 and will be applicable to all service officers who became/become non-effective on or after that date.\" ", "are unconstitutional and are struck down with this specification that the date mentioned therein will be relevant as being one from which the liberalised pension scheme becomes operative to all pensioners governed by 1972 Rules irrespective of the date of retirement. Omitting the unconstitutional part it is declared that all pensioners governed by the 1972 Rules and Army Pension Regulations shall be entitled to pension as computed under the liberalised pension scheme from the specified date, irrespective of the date of retirement. Arrears of pension prior to the specified date as per fresh computation is not admissible. Let a writ to that effect be issued. But in the circumstances of the case, there will be no order as to costs. ", "H.L.C. Petition allowed."], "relevant_candidates": ["0000685234", "0000873041", "0001230349", "0001281050", "0001327287", "0001766147", "0001863813", "0001881298", "0001939993", "0001964132", "0112850760"]} {"id": "0001460419", "text": ["JUDGMENT Leach, ", "1. The case for the appellants is completely devoid of merit, but questions of law have been raised and it is necessary to consider them. The appellants and respondent 4 are the managers of the communal lands of the village of Natarajapuram (also known by the name of Ethandarpatti) in the Trichinopoly Taluq. They sued in of Trichinopoly for a declaration that the deoree obtained in Order Section No. 82 of 1929 was not binding upon them or upon the other ryots of this village. In that suit defendants 1 to 4, as the representatives of the village of Arasankudi, sued four ryots of the village of Natarajapuram, as the representatives of that village, to recover a sum of Rs. 1667-4-0 which they claimed was due to the villagers of Arasankudi by the villagers of Natarajapuram in respect of the construction of a road connecting the two villages with the main road. Both the villages had asked authorities to construct the road and promised that they would contribute one-third of the cost, if would bear the rest. It was afterwards arranged that the two villages should contribute a total sum of Rs. 4000 which was to be borne by them equally. At a later stage, it was agreed between the villagers of Arasankudi and the villagers of Natarajapuram that the Arasankudi villagers should pay Rs. 2250 of the Rs. 4000 and the villagers of Natarajapuram Rs. 1750. The villagers of Arasankudi paid the full amount and the villagers of Natarajapuram reimbursed them to the extent of Rs. 500 but they failed to pay the balance, and in consequence defendants 1 to 4, suing on behalf of all the villagers of Arasankudi, instituted the suit to recover the balance. ", "2. The District took the plaint on his file on 20th February 1929 and numbered the suit as No. 82 of 1929. \"With the plaint were filed two applications, one for an order permitting the plaintiffs to sue on behalf of the villagers of and the other for an order allowing them to sue the defendants as the representatives of the village of Natarajapuram. Having numbered the plaint, the District directed that notice should issue to the defendants and that a general notification should be published in . The defendants were served, and the notification was duly published. After this had been done, namely, on 19th April 1929, the District granted leave to the plaintiffs, as representing , to sue the defendants as representing Natarajapuram. In his order he pointed out that there was no opposition to the application. He also directed that as defendant 3 was absent the case should proceed against him exparte. Subsequently, defendant 3 filed an application for an order setting aside the exparte order which was passed against him on 19th April 1929 and asked for permission to file a written statement. This application was granted. All the defendants filed written statements. On 2nd April 1981 the plaintiffs and defendants 1, 2 and 4, filed in Court a statement agreeing that a decree for Rs. 1250 and costs should be passed against the communal properties of the village of Nataraja-puram with full liberty to the plaintiffs to proceed in execution against these properties. Defendant 3 did not join in this application. In conjunction with the plaintiffs, he filed a memorandum stating that he was not willing to continue on the record as one of the representatives of the village of Nataraja-puram and that the plaintiffs consented to the suit being proceeded with against defendants 1, 2 and 4 as the representa-tives of Natarajapuram. In these circumstances he asked that his name be removed from the suit. On 7th April the District passed a decree in accordance with the terms agreed upon by the parties and set out in these two statements. The suit out of which this appeal arises was filed by the appellants on 4th January 1933 in accordance with the provisions of Order 21, Rule 68, Civil P.C. The decree-holders in Order Section No. 82 of 1929 had attached the communal lands of Natarajapuram in execution of their decree and the appellants' objection to the attachment had been overruled. The District decreed the suit On the following grounds, (1) In the earlier suit the requirements of Order 1, Rule 8 had not been complied with and (2) as defendant 3 had disappeared from that suit the Court had no power to pass a decree against the three remaining defendants as the representatives of Natarajapuram without an order expressly directing the suit to proceed against them. On appeal the decree of the District was confirmed. The defendants then appealed to this Court. held that the decree which had been passed in the former suit was binding upon the plaintiffs and consequently dismissed their suit with costs. This appeal is from the judgment of the learned Judge under Clause 15, Letters Patent. ", "3. As before , the appellants have raised four contentions. The first two are the contentions which the District Munsif and the Subordinate Judge accepted. They also say that the has no power to pass an order allowing persons to be sued in a representative capacity when the claim is upon a mere debt. Further they say that the decree in the former suit is not binding upon them because the defendants had no power to enter into a compromise. Order 1, Rule 8 reads as follows: ", "(1) Where there are numerous persons having the same interest in one suit, one or more of such persons may, with the permission of the , sue or be sued or may defend, in such suit, on behalf of or for the benefit of all persons so interested. But the shall in such case give, at the plaintiff's expense, notice of the institution of the suit to all such persons either by personal service or, where from the number of persons or any other cause such service is not reasonably practicable, by public advertisement, as the in each case may direct. ", "(2) Any person on whose behalf or for whose benefit a suit is instituted or defended under Sub-rule (1) may apply to the to be made a party to such suit. ", "4. Mr. on behalf of the appellants says that when the plaint is first filed it is incumbent upon the to pass an order permitting the suit to be brought in a representative capacity or the defendants to be sued as representatives, if the allegations in the plaint justify the order. After permission has been given, it is incumbent upon the to issue public notice that the suit has been instituted so that other persons may apply to be added as defendants. Here the permission to the plaintiffs in the former suit to sue as the representatives of the Arasankudi village the defendants named therein as the representatives of Natarajapuram village was granted after the publication in the District Gazette of the notice that the suit had been filed. Consequently, Mr. argues that as the rule contemplates permission before publication of the notice it was necessary for the District Munsif to issue a fresh notice and his failure to do so vitiated the proceedings. In this connexion he has pointed to the following passage in the judgment of in ('33) 20 A.I.R. 1933 P.C. 183 at p. 666: ", "On such permission being given it becomes the imperative duty of the to direct notice to be given to the absent parties in such of the ways prescribed as the in each case may require; while liberty is reserved to any represented person to, apply to be made a party to the suit. ", "5. Emphasis is laid on the words \"imperative duty\". Divorced from its context this passage does give support to the appellants, but when the judgment is read as a whole, it is quite clear that did not intend to lay down a rule that non-compliance with the strict wording of the rule was fatal to the case. ('33) 20 A.I.R. 1933 P.C. 183 the question was whether the decision in a former suit operated as resjudicata when no permission had been sought or granted under Order 1, Rule 8. held that in a representative suit the decision in a former suit does not operate as resjudicata by reason of Section 11, Civil P.C, Expln. 6, unless the former suit was instituted in compliance with Order 1, Rule 8 of the present Code. By compliance was meant the institution of the suit with the permission of the sifter the notice as prescribed by Order 1, Rule 8 had been given. But Lord in delivering the judgment of the said that their Lordships would not exclude the possibility of a decree being within the benefit of Expln. 6 of Section 11, where the litigation having been bona fide the omission to comply with the conditions of the rule had been inadvertent and no injury from the omission had been sustained by the plaintiff in the second suit. It was, however, imperative to have it recognised that the burden upon a defendant seeking a ruling to that effect was heavy indeed. No encouragement should, they thought, be offered to litigants if they would obtain the full benefit of Order 1, Rule 8 to be careless in securing full compliance with the conditions of the rule, both in the letter and in the spirit. The object of Order 1, Rule 8 is to permit a person who has an interest in the subject-matter of the suit to apply to the to be made a defendant. He may not be convinced that the defendants named in the plaint will defend the suit properly as the representatives of all persons concerned. In this case the District Munsif, strictly speaking, should have passed orders on the two applications filed by the plaintiffs in the former suit when he admitted their plaint and left the publication of the notice of the suit to a later stage but the fact that he gave to the plaintiffs as the representatives of the Arasankudi permission to sue the defendants as the representatives of Natarajapuram after he had notified by public advertisement the institution of the suit prejudiced no one. Any person residing in Natarajapuram could have applied to be made a defendant, but no one chose to do so. The villagers of Natarajapuram had notice of the institution of the suit and they were prepared to allow it to proceed with the defendants chosen by the plaintiffs. Consequently, we hold that there was sufficient compliance with Order 1, Rule 8. ", "6. We consider that there is no greater force in the appellants' contention that the was not entitled to pass a decree against defendants 1, 2 and 4, because it had allowed defendant 3 to drop out. Here Mr. has relied on the judgment of in ('31) 18 A.I.R. 1931 Mad. 452 and ('34) 21 A.I.R. 1934 Mad. 202. In the former of these twp cases, held that where sanction is given by a to certain persons eo nomine to institute or defend a suit and one of them dies, the right does not survive and therefore his heirs cannot come on the record unless the order granting the sanction can be construed as conferring the right to do so. He considered that the proper procedure was for the remaining persons to apply to the for directions and it was for the to decide whether it would permit them to continue to prosecute or defend the suit or whether it would insist upon the original number, in which case it should give directions in this respect. The judgment in ('34) 21 A.I.R. 1934 Mad. 202 was to the same effect. considered these two decisions and, in his opinion, it was not incumbent upon the remaining parties to apply to the for directions. The suit could lawfully proceed without them. It is not necessary for the purpose of this, appeal to decide whether the 's directions are necessary or not, because it is quite clear that all parties, including defendant 3, were willing that there should be a decree against defendants 1, 2 and 4 in their representative capacity. In passing the decree which it did the in fact permitted the suit to proceed against the remaining defendants. ", "7. considered that the appellants ought not to be allowed to raise the plea that there cannot be a representative suit in respect of a debt and we agree with him. Permission had been given to the plaintiffs in the former suit to sue in a representative capacity and it may be added that the plea was not raised in the plaint. It may also be pointed out that the suit was a claim to enforce payment of a debt due by the whole village in connection with the construction of a road for the benefit of all the villagers and it is difficult in such circumstances to see why the defendants could not be sued in a representative capacity. Otherwise it would mean the joining of every inhabitant of the village. The last contention, namely, that the defendants in the former suit had no power to compromise can be disposed of in a few words. There are two Bench decisions of this Court which say that persons conducting a suit on behalf of themselves and others with leave of the Court can enter into a compromise so as to bind those whom they represent and the same principle must apply when the defendants are sued in a representative capacity. The first case is ('13) 24 M.L.J. 192 and the second the unreported case of v. Anthony Nadar C.M.A. No. 266 of 1930. The appeal will be dismissed with costs."], "relevant_candidates": ["0000069863", "0000899432", "0001504393", "0001812003"]} {"id": "0001463760", "text": ["CASE NO.: Special Leave Petition (civil) 10653 of 1998 Special Leave Petition (civil) 12013 of 1998 Special Leave Petition (civil) 16740 of 1998 PETITIONER: STATE OF BIHAR & ORS. Vs. RESPONDENT: & ANR. DATE OF JUDGMENT: 27/04/2000 BENCH: , & . JUDGMENT: ", "SETHI, J. ", "L...I...T.......T.......T.......T.......T.......T.......T..J The respondents and and one were directly recruited as Sub-Inspectors of Police on 2.1.1966. was promoted as Inspector of Police on officiating basis on 16.7.1971 with a clear stipulation that he will not get seniority in the rank of Inspector till selected by the IG's Board. Consequently he actually joined on 22.7.1971. was promoted as Inspector on 8.7.1972 in terms of Rule 616(c) of the Bihar Police Manual Rules (hereinafter referred to as \"the Rules\") as he had been awarded gallantry award. On 2.7.1978 was promoted as Inspector after selection under Rule 649 and was confirmed as such on 1.4.1982. The aforesaid respondent filed Writ petition No.6873 of 1990 in of Patna praying for direction to the respondents therein to consider his case for promotion to the post of Dy.SP treating his date of promotion to the post of Inspector of Police as 27.7.1971, the date when he joined as Inspector of Police consequent upon his initial promotion on officiating basis. The aforesaid writ petition was disposed of by on 30th November, 1990 directing to file representation and the petitioner-State to dispose of the same within three months. On 14.5.1991 the Director General of Police directed seniority of the aforesaid respondent in the rank of Inspector to be reckoned with effect from 27.7.1971. However, on 13.4.1993 the DGP modified the aforesaid order and directed confirmation of in the rank of Inspector with effect from 2.7.1978 when he was substantively promoted under Rule 649 of the Rules and placed him at Sl.No.86 Ka in the seniority list of Inspectors. Feeling aggrieved, the aforesaid respondent filed Writ Petition No.4108 of 1991 in which was allowed on 8.4.1994 with a direction of reckoning his seniority as Inspector with effect from 27.7.1971 and grant of all consequential benefits to him. As the directions were not complied with, contempt petition being MGC No.1360 of 1994 was filed in and according to the petitioners the order of passed in Writ Petition No.4108/91 was implemented allegedly under the threat of contempt. ", " who was promoted as Inspector out of turn on the basis of gallantry award in terms of Rule 616(c) of the Rules had been promoted as Dy.SP with effect from 25th October, 1975. Alleging that the aforesaid was junior to him, the respondent filed writ petition No.697 of 1995 claiming promotion with effect from the date when was promoted as Dy.SP. The aforesaid writ petition was allowed on 26th July, 1995 directing promotion of as Dy.SP with effect from 25th October, 1975. The Letters Patent Appeal filed against the aforesaid judgment was dismissed by a Division Bench of on 22nd March, 1996 vide the judgment impugned in the SLP 12013/98. ", "There being delay of 679 days in filing the SLP, the appellants have also filed Application being IA No.1/98 seeking condonation of delay in filing the SLP. It is submitted in the application that the order of of could not be challenged earlier allegedly due to the fear of contempt and various coercive orders passed by against the and its officials. It is contended that as consequent upon the judgment of in case, a number of writ petitions have been filed in of Patna for the grant of similar benefits, the had no option left except to approach this Court. It is contended that the judgment impugned has been passed in violation of the provisions of law and the rules applicable and it has become a havoc in the and is facing great trouble in compliance of such type of directions for conferment of uncalled for benefits. It is submitted that if the impugned judgment is not rectified or set aside, the interests of more than 250 officers would be adversely affected. By promoting a number of senior officers are stated to have already superseded for no fault of theirs. If promotions are given in terms of the directions of , the same is likely to upset the entire cadre of Dy.SP of Police as well as Inspectors of Police in the of Bihar. If not stopped, the consequence would be uncalled for litigation with heavy financial burden upon the . ", " respondent in the SLP 10653 of 1998 filed a writ petition in praying for issuance of directions to the appellants to assign him seniority in the rank of Inspector of Police over and thereafter provide him with all consequential benefits. He claimed to have been appointed along with as Sub Inspector of Police in January, 1966. His name was shown above the name of in the cadre of Sub Inspectors. Both of them passed the training together. He claimed that his case for substantive appointment of Sub Inspector was placed before along with the cases of and others. which held its meetings on 17th and 18th August, 1978 is stated to have declared both the respondents as fit for officiating promotion on the higher post of Inspector of Police. On the basis of the recommendations made by the Board a Gazette Notification is stated to have been issued on 6th October, 1978 by which both the aforesaid respondents were promoted on officiating basis to the higher post of Inspector of Police. However, despite notification could not join the post of Inspector till 3rd March, 1981. Both the aforesaid respondents were stated to have been confirmed with effect from 1.4.1982. In the seniority list published on 18th May, 1988, the said was shown senior to by being placed at Sl.No.224 and at Sl.No.225. He then referred to the filing of the writ petition by respondent to which he was not made a party. He claimed that after the promotion of he could not be denied the relief claimed. Allowing the writ petition on 3rd July, 1997, the learned Single Judge of directed the petitioners herein to treat the said respondent as senior to as Inspector of Police and provide him with all consequential benefits including promotion to the next higher post, if he otherwise was found fit. It was, however, made clear that the judgment of the Court would not affect the interest of in the matter of promotion to the post of Dy.SP and SP which was noticed to have been already granted to him. LPA filed against the judgment of the learned Single Judge was dismissed on the ground of unexplained delay of 174 days, vide the judgment impugned in this petition. ", " and others who were intervenors in filed an application with the submission that as they were likely to be adversely affected by the impugned judgment passed by the learned Single Judge and confirmed by the appellate Bench, their interests be protected and the court should ensure by giving the benefit to the writ petitioners that the interest of the intervenors would not be adversely affected. Their application was dismissed holding: ", "\"However, those persons are neither party in the present nor they were party in the writ applications referred to above. Even if they have bonafide grievance, the same cannot be appreciated and considered in this .\" ", "They have also sought the condonation of delay mainly on the ground of not being aware of the judgment passed by which ultimately and eventually adversely affected their interests. ", "We have heard the arguments of the learned counsel appearing for the parties and have perused the records.@@ JJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJ Appearing for the petitioners , Senior Advocate has submitted that under the circumstances of the case and for the reasons detailed in the applications sufficient grounds have been made out for condoning the delay in filing the petitions. He has further submitted that the judgments impugned are contrary to law and totally in violation of the rules applicable in the case and if not set right, are likely to adversely affect a number of other officials who are admittedly senior than the respondents herein. According to the learned counsel 14 similar writ petitions and three contempt petitions are pending before wherein all the petitioners have claimed similar relief as was given to , on the ground of admittedly being senior to him. Besides 15 representations for similar reliefs are stated to be pending before the . is stated to have superseded 168 Inspectors by getting an order to give him seniority with effect from 27.7.1971. In the cadre of Dy.SP is stated to have superseded 407 officers by virtue of the judgment of in the second round claiming promotion as Dy.SP with effect from 25th October, 1975, when was promoted. It is contended that has committed an error of law by directing the conferment of benefits upon the respondent on the alleged ground of equality. No court can grant relief to a citizen by applying the concept of negative equality. Only because the had committed a mistake by giving seniority with effect from 27.7.1971 as Inspector and under the threat of contempt, promotion with effect from 25th October, 1975, the others who claimed to be similarly situated cannot force the to commit the same mistake and upon denial approach for issuance of appropriate directions. ", ", Learned Senior Advocate appearing for the respondents has, however, submitted that as the slept over its rights and felicitated the judgment in case become final, they are now not entitled to seek the condonation of unexplained delay. It is further submitted that and have already been conferred the benefits of the judgment and consequently promoted. By setting aside the judgments at this belated stage would not only adversely affect their interests but subject the aforesaid respondents to humiliation of demotion besides suffering of the monetary loss. The learned senior counsel has even denied the claim of Mr. regarding supersession of 168 Inspectors and 407 .SPs. It is contended that in view of the settled law the present petitions are liable to be dismissed. ", "Mr. and other advocates who appeared for the intervenors submitted that if the impugned judgments are not set aside, their clients along with others are likely to suffer for no fault of theirs. It is contended that in the absence of parties likely to be affected consequent upon the prayers made were necessary parties and in view of the fact that they have not been impleaded as party-respondents, the impugned judgments cannot adversely affect the interests of any senior officer. ", "Power to condone the delay in approaching the court has been conferred upon the courts to enable them to do substantial justice to parties by disposing of matters on merits. This Court in .[1987 (2) SCR 387] held that the expression 'sufficient cause' employed by the legislature in the Limitation Act is adequately elastic to enable the courts to apply the law in a meaningful manner which subserves the ends of justice - that being the life purpose for the existence of the institution of courts. It was further observed that a liberal approach is adopted on principle as it is realised that: ", "\"1. Ordinarily a litigant does not stand to benefit by lodging an appeal late. ", "2. Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this when delay is condoned the highest that can happen is that a cause would be decided on merits after hearing the parties. ", "3. 'Every day's delay must be explained' does not mean that a pedantic approach should be made. Why not every hour's delay, every second's delay? The doctrine must be applied in a rational common sense pragmatic manner. ", "4. When substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred for the other side cannot claim to have vested right in injustice being done because of a non- deliberate delay. ", "5. There is no presumption that delay is occasioned deliberately, or on account of culpable negligence, or on account of mala fides. A litigant does not stand to benefit by resorting to delay. In fact he runs a serious risk. ", "6. It must be grasped that judiciary is respected not on account of its power to legalize injustice on technical grounds but because it is capable of removing injustice and is expected to do so.\" ", "After referring to the various judgments reported in [1975 (2) SCC 840], [AIR 1917 PC 156], [1969 (1) SCR 1006], [1979 (4) SCC 365], [1969 (2) SCC 770], [1981 Supp SCC 72], [1982 (3) SCC 366 O.p. [1984 (4) SCC 66], Collector, Land Acquisitionv. Katiji [1987 (2) SCC 107], Prabha v. Ram Parkash Kalra [1987 Supp. SCC 339], [1988 (2) SCC 142], [1991 (1) SCC 174], [1993 (1) SCC 572], [1993 Supp (1) SCC 487], [1994 Supp (2) SCC 507] and [1995 Supp (1) SCC 37; this Court in . [1996 (3) SCC 132] held: ", "\"It is notorious and common knowledge that delay in more than 60 per cent of the cases filed in this - be it by private party or the - are barred by limitation and this generally adopts liberal approach in condonation of delay finding somewhat sufficient cause to decide the appeal on merits. It is equally common knowledge that litigants including the are accorded the same treatment and the law is administered in an even-handed manner. When the is an applicant, praying for condonation of delay, it is common knowledge that on account of impersonal machinery and the inherited bureaucratic methodology imbued with the note-making, file pushing, and passing-on-the buck ethos, delay on the part of the is less difficult to understand though more difficult to approve, but the represents collective cause of the community. It is axiomatic that decisions are taken by officers/agencies proverbially at slow pace and encumbered process of pushing the files from table to table and keeping it on table for considerable time causing delay - intentional or otherwise - is a routine. Considerable delay of procedural red-tape in the process of their making decision is a common feature. Therefore, certain amount of altitude is not impermissible. If the appeals brought by the are lost for such default no person is individually affected but what in the ultimate analysis suffers, is public interest. The expression 'sufficient cause' should, therefore, be considered with pragmatism in justice-oriented process approach rather than the technical detention of sufficient case for explaining every day's delay. The factors which are peculiar to and characteristic of the functioning of pragmatic approach in justice oriented process. The court should decide the matters on merits unless the case is hopelessly without merit. No separate standards to determine the cause laid by the vis-\u00e0-vis private litigant could be laid to prove strict standards of sufficient cause. The at appropriate level should constitute legal cells to examine the cases whether any legal principles are involved for decision by the courts or whether cases require adjustment and should authorise the officers to take a decision to give appropriate permission for settlement. In the event of decision to file the appeal needed prompt action should be pursued by the officer responsible to file the appeal and he should be made personally responsible for lapses, if any. Equally, the cannot be put on the same footing as an individual. The individual would always be quick in taking the decision whether he would pursue the remedy by way of an appeal or application since he is a person legally injured while is an impersonal machinery working through its officers or servants.\" ", "To the same effect is the judgment of this Court in [1996 (10) SCC 634]. ", " [1995 (6) SCC 614] this Court under the peculiar circumstances of the case@@ JJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJ condoned the delay in approaching this Court of about 31@@ JJJJJJJJJJJJJJJJJJJJJJJ years. [1998 (7) SCC 123] this Court held that the purpose of Limitation Act was not to destroy the rights. It is founded on public policy fixing a life span for the legal remedy for the general welfare. The primary function of a Court is to adjudicate disputes between the parties and to advance substantial justice. The time limit fixed for approaching the court in different situations is not because on the expiry of such time a bad cause would transform into a good cause. The object of providing legal remedy is to repair the damage caused by reason of legal injury. If the explanation given does not smack malafides or is not shown to have been put forth as a part of dilatory strategy, the court must show utmost consideration to the suitor. In this context it was observed: ", "\"It is axiomatic that condonation of delay is a matter of discretion of the court. Section 5 of the Limitation Act does not say that such discretion can be exercised only if the delay is within a certain limit. Length of delay is no matter, acceptability of the explanation is the only criterion. Sometimes delay of the shortest range may be uncondonable due to a want of acceptable explanation whereas in certain other cases, delay of a very long range can be condoned as the explanation thereof is satisfactory. Once the court accepts the explanation as sufficient, it is the result of positive exercise of discretion and normally the superior court should not disturb such finding, much less in revisional jurisdiction, unless the exercise of discretion was on wholly untenable grounds or arbitrary or perverse. But it is a different matter when the first court refuses to condone the delay. In such cases, the superior court would be free to consider the cause shown for the delay afresh and it is open to such superior court to come to its own finding even untrammelled by the conclusion of the lower court.\" ", "Looking into the facts and circumstances of the case, as noticed earlier and with the object of doing substantial@@ JJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJ justice to all the parties concerned, we are of the opinion@@ JJJJJJJJJJJJJJJJJJJ that sufficient cause has been made out by the petitioners which has persuaded us to condone the delay in filing the petitions. Dismissing the appeals on technical grounds of limitation would not, in any way, advance the interests of justice but admittedly, result in failure of justice as the impugned judgments are likely to affect not only the parties before us, but hundreds of other persons who are stated to be senior than the respondents. The technicalities of law cannot prevent us from doing substantial justice and undoing the illegalities perpetuated on the basis of the impugned judgments. However, while deciding the petitions, the reliefs in the case can appropriately be moulded which may not amount to unsettle the settled rights of the parties on the basis of judicial pronouncements made by the courts regarding which the is shown to have been careless and negligent. It is paramount consideration of this Court to safeguard the interests of all the litigants and persons serving the Police Department of the of Bihar by ensuring the security of the tenure and non disturbance of accrual of rights upon them under the prevalent law and the rules made in that behalf. Accordingly delay in filing the petitions is condoned. ", "Leave granted. ", "The facts as noticed earlier are not seriously disputed. The respondent had filed Writ Petition No.1556/90 praying therein that he be given the same benefit as was given to the writ petitioners in Writ Petition No.563 of 1985. He contended that similar benefits had been conferred upon many police officers and he had allegedly been discriminated. The writ petition was dismissed as withdrawn on 31st July, 1990 with the observation that \"however, this shall not prejudice the petitioners in pursuing a remedy, if any, available to him or pursuing his representation which we are informed is pending with the State\". As his representation dated 4.6.1988 had not been considered, filed writ petition No.6873 of 1990 in which he prayed: ", "\"Under the above facts and circumstances it is, therefore, prayed that your lordships be graciously pleased to admit this application issue rule NISI and after both parties and there show causes if any allow this application by issuing a writ of directing the respondents to give promotion and other consequential benefits to the petitioner from the post of Inspector of Police to the post of Deputy Superintendent of Police from the date the petitioner is found in legal entitle considering the case for promotion to the post of Deputy Superintendent of Police by treating as confirmed Inspector of Police with effect from 27.7.71 i.e. the date of continuous officiation in the rank of Inspector of Police in the event of judgments and order passed by relying on judgment of contained in Annexure 1, 2 and 3 of this writ application or pass such other order or orders as to your lordships may be pleased fit and proper.\" ", "As the Director General modified his order dated 14th May, 1991 vide his subsequent order dated 13.4.1993, filed Writ Petition No.4108 of 1994 wherein he alleged that his seniority had not been fixed correctly in the rank of Inspectors. A learned Single Judge of vide his interim order directed appellants herein to issue a regular order of promotion and if so advised to determine the seniority of the writ petitioners in the cadre of Dy.SP of Police. It examined the legality of the order of the Director General of Police dated 13.4.1993 and held: ", "\"The petitioner's seniority once determined in the rank of Inspector with effect from 27.7.1971 cannot be legally altered without notice nor is any justification for the alteration pointed out by the learned counsel. ", "Therefore, his seniority in the rank of Inspector has to be reckoned with effect from 27.7.1971. The date of confirmation, in these circumstances, would, therefore, not to relevant for determining the seniority of the petitioner in the rank Inspector, and is necessary, his confirmation on the post of Inspector would have to as made afresh treating the petitioner to have been placed on probation in the rank of Inspector from 27.7.1971. Further consequential revisions, if necessary, shall also be made in the gradation list of the Deputy Superintendent of Police where the petitioner has been placed at Serial Number 399.\" ", "The impugned order was quashed and a direction issued to the appellant to reckon the seniority of the writ petitioners in the rank of Inspectors with effect from 27.7.1971 with all consequential benefits as a result of revision of his seniority in the rank of Inspector as well as that of Dy.SP of Police. Admittedly, this order was not appealed against and ultimately implemented by the authorities of the appellant- State. By order dated 1st October, 1994 the respondent was held entitled for promotion to the post of Dy.SP with effect from 11th July, 1981 and not with effect from 25th October, 1975. He again filed writ petition No.697 of 1995 submitting therein that having been confirmed to the lower post of Inspector of Police from 1st March, 1975 his seniority should be counted from the date of confirmation i.e. 25th October, 1975. It was noticed that who was allegedly junior to him had been promoted to the post of Inspector with effect from 8th July, 1972. claimed to be senior to said on the ground of having been promoted as Inspector on officiating basis on 27.7.1971. The learned Single Judge held: ", "\"Having heard the parties, my considered view is that the impugned order dated 1st October, 1994 is completely illegal. The same is against the order and direction of this Court dt.8th April, 1994, passed in CWJC No.4108/91, wherein this court categorically held and directed the respondents to provide the petitioner with the seniority in the rank of Inspector of Police with effect from 27th July, 1971. By the impugned order, as contained in annexure-12, the respondents cannot superseded and/or alter the aforesaid finding of this Court, in fact, Annexure-12 is contemptions. ", "Apart from the aforesaid fact, numerous decisions, including the decision given by , as reported in AIR 1977 SC 2051, it has been held that the seniority of a person cannot be dependent on confirmation, if confirmation itself is fortuitous in nature. In the present case I have taken into note that confirmation of the petitioner and to the post of Inspector of Police itself was fortuitous in nature, the same having not been made on the assessment of merit. Such being the position, the impugned order dated 1st October, 1994 cannot be sustained in the eye of law.\" ", "The order dated 1st October, 1994 in so far as it related to the writ petitioner was set aside with a direction to the authorities of the appellant-State to consider the case of the writ petitioner for promotion to the post of Dy.SP with effect from 25th October, 1975 i.e. the date when his alleged junior was promoted. It was further directed that in case the writ petitioner was found fit for promotion with effect from 25th October, 1975 he would shift back the date of promotion to the post of Dy.SP from 11th July, 1971 to 25th October, 1971. The appellants were further directed to provide all consequential benefits to the petitioners. ", "Rule 649 deals with the promotion of Sub Inspectors to Inspectors and Reserve Sub-Inspectors to Reserve Inspections and provides: ", "\"649. Inspectors and Reserve Inspectors-- (a) The promotion of Sub-Inspectors to Inspectors, and Reserve Sub-Inspectors to Reserve Inspectors will be made by the Inspector-General on the advice of the Inspector General's Selection Board [Appendix 72(1)] (For period of probation, See Rule 668). ", "(b) In July the Deputy Inspector-General will call for nominations for promotion to reach him on the date fixed. The form of nomination and the list of enclosures are given in P.M. Form No.102. ", "(c) At least 14 days before nominations are sent to the Deputy Inspector General the names of the nominees shall be published by the nominating authority in district orders so that those who are not nominated may have an opportunity of representing their cases before the nominations are actually submitted. Officers, having such representation to make, should be given interviews and their cases examined with them. ", "In case their representations are rejected, those who have been superseded may file representation before Deputy Inspector General. Such representation shall be submitted within 14 days of receipt of information and this shall be forwarded soon to Deputy Inspector General, so that additional nominations may be sent on the orders of Deputy Inspector General. ", "In forwarding the nominations a certificate must be given of the dates on which the lists were published and intimations sent to those not nominated. In selecting Sub-Inspectors and Reserve Sub Inspectors for promotion, preference should be given to those who have received special commendation for integrity of character and good defective work. ", "(d) [Appendix 72(3)] shall scrutinize the district nominations and shall select from among them in order of merit those whose nominations are to be sent before [Appendix 72(1)] on a date to be fixed by the Inspector- General. ", "(e) [Appendix 72(1)] shall scrutinize the nominations of and compile a list of selections which should ordinarily be in order of seniority for promotion as vacancies occur. If an officer is placed higher in the list than his seniority warrants a full note giving reason shall be recorded. This list shall be of as many Sub-Inspectors as there are vacancies plus few anticipatory vacancies depending on averages of last few years. Promotions by the Inspector-General under clause (a) shall be confined to this list but if any one does not get appointed from the list, his case shall be reviewed again at the time of preparation of the next year's list and if found fit, he shall be placed above the selected nominees of that year.\" ", "The respondent is stated to have been promoted as Inspector in terms of the said Rule on@@ JJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJ 2nd July, 1978. Rule 660(c) deals with the out of turn@@ JJJJJJJJJJJJJJJJJ promotions and reads: \"Selection Boards may recommend out of turn promotion of officers with outstanding records of service and competent authorities may order such promotion in deserving cases as they deem fit and proper with the approval of next higher authority. ", "Officers so promoted should be placed below the officers of the approved existing list of respective rank prepared by and be confirmed against substantive vacancies as and when vacancies arise in the order of the list. ", "Criteria taken together for determining outstanding records of service will be as follows: ", "i) Award of President's Police Medal and Indian Police Medal, for gallantry and distinguished service. ", "ii) Should not have been awarded any major punishment till the date of consideration and order of out of turn promotion. ", "iii) Very good entries in permanent Character Roll. ", "iv) Citation regarding high standard of investigation, detection and control of crime and intelligence work. ", "v) Should have ability for shouldering higher responsibilities consonant with the proposed promotion [See , dated 12th May, 1976]. ", " was promoted under the aforesaid rule on 8.7.1972. The respondent prayed his promotion to be made effective from 27th July, 1971 when he jointed as Inspector consequent upon his promotion on officiating basis. The order of his promotion read as: ", "\"Following Sub-Inspectors are promoted to officiate as Inspector w.e.f. the date they join their place of posting noted against each. They will not get the advantage of the previous contained in GOM VII/1966 towards their seniority in the rank of Inspector till they are finally selected by I.G.'s Board. ", " - P.S. as usual he will function as Cr.O for Sadar Sub-division.....\" This Court in ., etc. [1993 (2) SCR 919] held that to enable seniority to be counted from the date of initial appointment and not according to the date of promotion, the incumbent of the post has to be initially appointed \"according to the rules\". Where the initial appointment is only adhoc and not according to the rules and made as a stop gap arrangements, the officiation on such post cannot be taken into account for considering the seniority. In that case the Court relied upon the judgment of the Constitution Bench in . [1990 (2) SCR 900] wherein it was held that: ", "\"(A) Once an incumbent is appointed to a post according to rule, his seniority has to be counted from the date of his appointment and not according to the date of his confirmation. ", "The corollary of the above rule is that where the initial appointment is only adhoc and not according to rules and made as a stop gap arrangement, the officiation in such post cannot be taken into account for considering the seniority. ", "(B) If the initial appointment is not made by following the procedure laid down by the rules but the appointee continues in the post uninterruptedly till the regularisation of his service in accordance with the rules, the period of officiating service will be counted. ", "(C) When appointments are made from more than one source, it is permissible to fix the ratio for recruitment from the different sources, and if rules are framed in this regard they must ordinarily be followed strictly. ", "(D) If it becomes impossible to adhere to the existing quota rule, it should be substituted by an appropriate rule to meet the needs of the situation. In case, however, the quota rule is not followed continuously for a number of years because it was impossible to do so the inference is irresistible that the quota rule had broken down. ", "(E) Where the quota rule has broken down and the appointments are made from one source in excess of the quota, but are made after following the procedure prescribed by the rules for the appointment, the appointees should not be pushed down below the appointees from the other source inducted in the service at a later date. ", "(F) Where the rule permits the authorities to relax the provisions relating to the quota, ordinarily a presumption should be raised that there was such relaxation when there is a deviation from the quota rule. ", "(G) The quota for recruitment from the different sources may be prescribed by executive instructions, if the rules are silent on the subject. ", "(H) If the quota rule is prescribed by an executive instruction, and is not followed continuously for a number of years, the inference is that the executive instruction has ceased to remain operative. ", "(I) The posts held by the permanent Deputy Engineers as well as the officiating Deputy Engineers under the State of Maharashtra belonged to the single cadre of Deputy Engineers. ", "(J) The decision dealing with important questions concerning a particular service given after careful consideration should be respected rather than scrutinised for finding out any possible error. It is not in the interest of service to unsettle a settled position.\" ", "It is thus evident that having been promoted on officiating basis with a clear stipulation that he will not get seniority in the rank of Inspector till finally selected could not have preferred a claim regarding his seniority on the basis of promotion of , though initially junior to him yet substantively promoted in accordance with Rule 660C on 8.7.1972 whereas was promoted after selection under Rule 649 in 1978. totally ignored the basic principles governing the service rules and the mandate of law. There was, therefore, no justification of issuing the directions to direct the promotion of while deciding the writ petition No.697 of 1995 and dismissing the LPA No.1018/95 vide the judgment impugned in this appeal filed against . ", "It appears that totally lost sight of the fact that in his petitions filed from time to time had not impleaded any of his seniors as party-respondents. In the absence of persons likely to be affected by the relief prayed for, the writ petitions should have normally been dismissed unless there existed specific reasons for non impleadment of the affected persons. Neither any reason was assigned by the writ petitioner nor the court felt it necessary to deal with this aspect of the matter. Ignoring such a basic principle of law has resulted in the supersession of 168 Inspectors and 407 .SPs. The writ petition filed by being totally misconceived, devoid of any legal force and prayers made being in contravention of the rules applicable in the case deserved dismissal, which was unfortunately not done with the result that the interests of many seniors have been threatened, endangered and adversely affected. The appeal of the State has, therefore, to be allowed by setting aside the impugned judgment. ", " respondent in his petition has preferred his claim of promotion on the ground of promotion@@ JJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJ of his junior who was impleaded as@@ JJJJJJJJJJJJJJJJJJJ respondent No.6. He had specifically submitted: ", "\"That from the facts, law and circumstances stated above it is clear that the petitioner was at all material times senior to the respondent No.6 and the respondent NO.6 illegally scored a march over him therefore on the principles of recognised service jurisprudence on next below rule, the petitioner should be assigned seniority from 27.7.71 and be confirmed with effect from 2.7.78 and the petitioner be put just above the respondent no.6 in the seniority list of Inspector of Police.\" ", "He had prayed that: ", "\"For issuance of appropriate writ, order or direction to direct the official respondents to assign seniority in the rank of Inspector just above the respondent No.6 and to confirm on the post of Inspector with effect from 2.7.78 when his junior respondent no.6 has been confirmed and for grant of all consequential benefits.\" The writ petition was disposed of holding as senior to as Sub Inspector of Police having been confirmed as Inspector on 1.4.1982 with observeation: \"Subsequently, whatever the advantage, the respondent No.6 has derived in pursuance of different orders of this Court, including the orders/judgments passed in CWJC No.6873/90; 4108/91 and 6975/95, were so obtained by him without impleading the petitioner as part-respondent therein. ", "In this background, while I do not doubt the decisions given by this Court in different cases of respondent No.6, and while I do not doubt the consequential orders which have been issued by the respondents on the basis, I hold that the petitioner cannot suffer for the same and he is entitled for seniority over the respondent No.6 as Inspector of Police, though not promoted, while the Respondent No.6 was granted officiating promotion by way of stop gap arrangement on 27th July, 1971. ", "Accordingly, the respondents are directed to treat the petitioner as senior to the respondent No.6 as Inspector of Police and provide him with the consequential benefit of the same, including promotion to the next higher post, if the petitioner is found fit for the same.\" ", "The appeal filed against this judgment was dismissed on the ground of delay and without consideration of the pleas raised on facts. The concept of equality as envisaged under Article 14 of the Constitution is a positive concept which cannot be enforced in a negative manner. When any authority is shown to have committed any illegality or irregularity in favour of any individual or group of individuals other cannot claim the same illegality or irregularity on ground of denial thereof to them. Similarly wrong judgment passed in favour of one individual does not entitle others to claim similar benefits. In this regard this Court in . [1996 (2) SCC 459] held that citizens have assumed wrong notions regarding the scope of Article 14 of the Constitution which guarantees equality before law to all citizens. Benefits extended to some persons in an irregular or illegal manner cannot be claimed by a citizen on the plea of equality as enshrined in Article 14 of the Constitution by way of writ petition filed in . The Court observed: ", "\"Neither Article 14 of the Constitution conceives within the equality clause this concept nor Article 226 empowers to enforce such claim of equality before law. If such claims are enforced, it shall amount to directing to continue and perpetuate an illegal procedure or an illegal order for extending similar benefits to others. Before a claim based on equality clause is upheld, it must be established by the petitioner that his claim being just and legal, has been denied to him, while it has been extended to others and in this process there has been a discrimination.\" ", "Again in . [1997 (1) SCC 35] this Court considered the scope of Article 14 of the Constitution and reiterated its earlier position regarding the concept of equality holding: ", "\"Suffice it to hold that the illegal allotment founded upon ultra vires and illegal policy of allotment made to some other persons wrongly, would not form a legal premise to ensure it to the respondent or to repeat or perpetuate such illegal order, nor could it be legalised. In other words, judicial process cannot be abused to perpetuate the illegalities. Thus considered, we hold that was clearly in error in directing the appellants to allot the land to the respondents.\" ", " [1997 (3) SCC 321] this Court observed: ", "\"The doctrine of discrimination is founded upon existence of an enforceable right. He was discriminated and denied equality as some similarly situated persons had been given the same relief. Article 14 would apply only when invidious discrimination is meted out to equals and similarly circumstanced without any rational basis or relationship in that behalf. The respondent has no right, whatsoever and cannot be given the relief wrongly given to them, i.e., benefit of withdrawal of resignation. was wholly wrong in reaching the conclusion that there was invidious discrimination. If we cannot allow a wrong to perpetrate, an employee, after committing mis-appropriation of money, is dismissed from service and subsequently that order is withdrawn and he is reinstated into the service. Can a similarly circumstanced person claim equality under Section 14 for reinstatement? The answer is obviously \"No\". In a converse case, in the first instance, one may be wrong but the wrong order cannot be the foundation for claiming equality for enforcement of the same order. As stated earlier, his right must be founded upon enforceable right to entitle him to the equality treatment for enforcement thereof. A wrong decision by the Government does not give a right to enforce the wrong order and claim parity or equality. Two wrongs can never make a right.\" ", "In view of our finding that the judgment of in the case of being contrary@@ JJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJJ to law was not sustainable and liable to be dismissed, the@@ JJJJJJJJJJJJJJJ impugned judgment in the case of case cannot be upheld. The aforesaid respondent is, therefore, not entitled to any relief as prayed for by him on the analogy of the judgments passed and directions given in 's case. ", "We do not agree with the submissions of the respondents that the question of law raised by the appellants in regard to determination of seniority could not be permitted to be raised as allegedly the said point had not been pleaded before and is altogether a new point taken for the first time in this Court. As noticed earlier, had dismissed the LPAs only on the ground of limitation without deciding the other pleas raised by the appellants. A perusal of LPA No.1018 of 1995 (Annexure P-6) shows that in para 9 the appeallant had submitted that the Home Secretary of the had filed a counter affidavit in the writ petition No.697 of 1995 stating therein: ", "\"...it is not correct to say that the petitioner (respondent in this appeal) is validly entitled to be promoted to the rank of Deputy Superintendent of Police from earlier date when junior to him namely joined as inspector on 8.7.1972 has been promoted to the rank of Deputy Superintendent of Police. The promotion of the petitioner in the rank of Inspector is different from . The petitioner was promoted to the rank of Inspector on adhoc basis with effect from 27.7.71 and has been confirmed with effect from 1.3.1975 on availability of permanent vacancy alongwith those Inspectors who were officiated on or before 27.7.1971, whereas was promoted in the rank of Inspector out of turn on 8.7.1972 on probation on the basis of Presidents Police Medal from gallantry. After expiry of probation of two years he () had been confirmed with effect from 8.7.1974 and promoted to the rank of Deputy Superintendent of Police, with effect from 25.10.1975, alongwith others. As such petitioner is not validly entitled for promotion to the rank of Deputy Superintendent of police from the earlier date when Sri was promoted to the rank of Deputy Superintendent of Police with effect from 25.10.1975.\" ", "In the memo of appeal, the appellant herein submitted that the promotion case of the respondent was different from that of . It was pleaded: ", "\"....The petitioner was promoted to the rank of Inspector on adhoc basis with effect from 27.7.1971 and later on he was given officiating promotion from that very date, i.e. 27.7.1971 and was confirmed with effect from 1.3.1975 on the availability of permanent vacancy alongwith those Inspectors, who were officiating on or before 27.7.1971 and promoted to the rank of Deputy Superintendent of Police with effect from 11.7.1981 according to seniority. As stated earlier was promoted out of turn in the rank of Inspector on 8.7.1972 on the basis of gallantry award by the . and the period of probation was treated by the government from 8.7.1972 itself. After expiry of probation of two years he was confirmed with effect from 8.7.1974 and promoted in the rank of Deputy Superintendent of Police from 25.10.1975. It was an exceptional case. This is not followed in general officiating officers are confirmed on availability of permanent vacancy and not put on probation from the date of officiation. If this respondent is put on probation with effect from 27.7.1971 i.e. from the date of officiation so many police officers will be superseded.\" ", "The State also submitted that the learned Single Judge of had committed a mistake of law by not considering all aspects of the matter before allowing the writ petition on 26th July, 1975 which required to be interfered with by the Division Bench of in the LPA. When specific plea regarding facts and law had been raised in the LPA, the arguments of the respondents cannot be accepted that such a plea had been raised by the appellant for the first time in this Court. It is further contended that as the respondent was, in the meantime, appointed/promoted in the Cadre and as per requirements of he has already submitted his resignation from , the acceptance of the appeal and setting aside the directions of would result in great hardship to him and amount to unsettling his settled service rights particularly when his promotion/appointment to the cadre has not been challenged and is not in dispute. Such a plea by itself cannot be accepted as a ground to dismiss the appeal filed against an order which we have held to be illegal being contrary to law and the Service Rules applicable in the case. Once the judgment is set aside, the consequences have to follow and a person taking advantage or benefit of the wrong orders is to suffer for his own faults which cannot be attributed to anybody-else. However, in appropriate cases this Court can mould the relief to safeguard the interests of a person wherever required. For doing complete justice between the parties, appropriate directions can be given to protect the interests of a person who is found to have been conferred the benefits on the basis of judicial pronouncements made in his favour. As the appellant-State has been found to be careless and negligent in defending its cases, we feel and are inclined to protect the interests of , respondent. We are convinced that the interests of justice would be served by holding that despite setting aside the judgments of his interests be protected by not disturbing his promotions made from time to time. However, judgments passed in his favour cannot be permitted to be made a basis for conferment of similar rights upon other persons who are shown to have filed writ petitions or representations which, if accepted, are likely to adversely affect the interests of more than 150 Inspectors and 400 Officers in the rank of Dy.SP. Similarly, if any benefit has been conferred upon any other person who has superannuated, no useful purpose would be served by directing his demotion retrospectively and recovery of the excess emoluments paid to him. Under the circumstances, the appeals are allowed/disposed of with the@@ JJJ directions that: (1) Judgments of the learned Single Judge@@ JJJJJJJJJJJJJJJJJ and of the LPA Bench passed in the case of impugned in Civil Appeal arising out of SLP (C) No.12013 of 1998 are set aside. (2) Similarly the judgments passed in case by the Single Judge and the LPA Bench which are impugned in this appeal arising out of SLP (C) NO.10653/98 are also set aside. (3) In view of setting aside the judgments in both the appeals mentioned above no orders are required to passed in Civil Appeal arising out SLP (C) NO.16740/98. (4) It is, however, made clear that despite setting aside of the impugned judgments the service benefits conferred upon consequent upon the judgments of shall not be withdrawn and his appointment/promotion in the cadre not disturbed. (5) Consequent upon this judgment the appellant-State shall also not take any action against a person conferred with similar benefits as were conferred upon if that person has retired and is no more in service. Parties to bear their own costs."], "relevant_candidates": ["0000077174", "0000485116", "0000516320", "0000644322", "0000752479", "0000776307", "0000824375", "0000852301", "0000958057", "0000970047", "0001043630", "0001117226", "0001240908", "0001622758", "0001702008", "0001709246", "0001728925", "0001816683", "0001909040", "0001912241", "0001929968", "0001954254", "0001983387", "0001994192"]} {"id": "0001466744", "text": ["JUDGMENT , Kt., C.J. ", "1. This suit was commenced in at Bombay, and is brought by the plaintiffs, who are the landlords, against defendant No. 1, who is the tenant, to eject him from 31-D Matarpakhdi, Mazgaon, Bombay, held by him under a monthly tenancy at a rent of Rs. 125 per month. The tenancy is alleged to have been terminated by notice dated April 29, 1943. The defence of defendant No, 1 is to plead the Bombay Rents, Hotel Rates and Lodging House Rates (Control) Act, 1944, which I will refer to as \"the 1944 Act\", and to rely on the fact that before this Act came into operation the plaintiffs had applied to the Controller for a certificate under the Bombay Rent Restriction Order, 1942, (which I will refer to as \"the 1942 Order\"), which was refused. Such refusal, it is said, is binding upon the plaintiffs under Section 15 of the 1944 Act. ", "2. In reply the plaintiffs allege that Part II of the 1944 Act is ultra vires and void for the reasons to which I will presently refer. ", "3. It is obvious that the challenge to the validity of Part II of the 1944 Act raises a question of public importance, since if Part II of the Act be invalid, all premises to which it is intended to apply would in effect never have been controlled at all owing to the; invalidity of the 1942 Order. In these circumstances, the Advocate General for Bombay was added as a party to the suit, which was in effect transferred at his request to and has been heard by this bench. No question is raised by any one as to the regularity or propriety of this procedure. ", "4. As I have already said, the notice to determine the tenancy was given on April 29, 1943, and an application was subsequently made to the Controller under the 1942 Order for a certificate which, if granted, would have had the effect of avoiding the restriction placed on the recovery of possession by the 1942 Order then supposed to be valid. This application was refused, and the plaintiffs then went on appeal to the Collector under Section 12 of the 1942 Order. Again they were unsuccessful. On April 6, 1944, a full bench of this Court held Sections 8, 9 and 12 of the 1942 Order invalid, and accordingly the plaintiffs commenced this suit on April 12, 1944. On May 12, 1944, the 1944 Act was promulgated by the Governor, part of the preamble to the Act being as follows: ", "AND WHEREAS the Governor of Bombay has assumed to himself under the Proclamation dated the 4th November 1939, issued by him under Section 93 of the Government of India Act, 1935, all powers vested by or under the said Art in ; ", "NOW, THEREFORE, in exercise of the said powers, the Governor of Bombay is pleased to make the following Act :. ", "The relevant sections of the 1944 Act are Sections 9 and 14. Section 9 is as follows: ", "(1) The landlord shall not be entitled to the recovery of possession of any premises so long as the tenant pays, or is ready and willing to pay, rent to the full extent allowable by this Part and performs the other conditions of the tenancy: ", "Provided that nothing in this section shall apply where the landlord has obtained a certificate from the Controller certifying that the tenant has committed any act contrary to the provisions of Clause (o) or Clause (p) of Section 108 of the Transfer of Property Act, 1882, or has been guilty of conduct: which is a nuisance or an annoyance to any adjoining or neighbouring occupiers or that the rent charged to a sub-tenant is in excess of the standard rent, or that the premises are reasonably and bona fide required by the landlord either for his own occupation or for the occupation of any person for whose benefit the premises are held or for any other cause which may be deemed satisfactory by the Controller. ", "(2) Where an order for the recovery of possession has been made in favour of a landlord on or after the 6th day of April 1944 but not executed before the date of publication of this Act, the Court by which the order was made may, if it is of the opinion that the order would not have been made if this Part had been in operation at the date of the making of the order, rescind or vary the order in such manner as the Court may think fit for the purpose of giving effect to this Part. ", "Section 14 is: ", "(1) Any person aggrieved by an order passed by the Controller, under the provisions of this Part (including an order granting a certificate under the proviso to Sub-section (1) of Section 9 ) may, within fifteen days from the date on which the order is communicated to him, present an appeal in writing to the Collector. ", "(2) The Collector shall then call for the record of the Controller and after examining the record and after making such further inquiry as he thinks fit, either personally or through the Controller, shall decide the appeal. ", "(3) The decision of the Collector, and subject only to such decision, the order of the Controller shall, for the purposes of this Part, be final; and no Civil Court shall have jurisdiction to settle, decide or deal with any question) which is by or under this Part required to be settled, decided or dealt with by the Controller and Collector. ", "5. The Governor's competency to exercise the Provincial legislative function arises by virtue of the powers conferred on him by Section 93 of the Government of India Act, 1935, which I will refer to as \"the Constitution Act \", and a Proclamation made by him on November 4, 1939. Section 93 , so far as material, is as follows: ", "(1) If at any time the Governor of a Province is satisfied that a situation has arisen in which the government of the Province cannot be carried on in accordance with the provisions of this Act, he may by Proclamation ", "(a) declare that his functions shall, to such extent as may be specified in the Proclamation, be exercised by him in his discretion; ", "(b) assume to himself all or any of the powers vested in or exercisable by any Provincial body or authority ; ", "and any such Proclamation may contain such incidental and consequential provisions as may appear to him to be necessary or desirable for giving effect to the objects of the Proclamation, including provisions for suspending in whole or in part the operation of any provisions of this Act relating to any Provincial body or authority: ", "Provided that nothing in this sub-section shall authorise the Governor assume to himself any of the powers vested in or exercisable by , or to suspend, either in whole or in part, the operation of any provision of this Act relating to .\" Sub-section (2) deals with revocation, and Sub-section (3) contains certain consequential provisions. ", "Sub-section (4) is as follows: ", "If the Governor, by a Proclamation under this section, assumes to himself any power of to make laws, any law made by him in the exercise of that power shall, subject to the terms thereof, continue to have effect until two years have elapsed from the date on which the Proclamation ceases to have effect, unless sooner repealed or re-enacted by Act of the appropriate Legislature, and then come the following words which are important: ", "and any reference in this Act to Provincial Act s, Provincial Laws, or Acts or laws of shall be construed as including a reference to such a law. ", "i.e. a law made by the Governor. ", "The Proclamation of November 4, 1939, commences with the following preamble: ", "WHEREAS the Governor of the Province of Bombay is satisfied that a situation has arisen in which the Government of the Province cannot be carried on in accordance with the provisions of the Governments of India Act, 1935 (hereinafter referred to as 'the Act'): ", "And the operative part of the Proclamation is this: ", "Now, therefore, in the exercise of the powers conferred by Section 93 of the Act and with the concurrence of the Governor General, the Governor by this Proclamation ", "(a) declares that all his functions under the Act shall be exercised by him in his discretion ; ", "(b) assumes to himself all powers vested by or under the Act in and all powers vested in either Chamber of the Legislature but not so as to affect any power exercisable by His Majesty with respect to Bills reserved for his consideration or the disallowance of Acts ; and he hereby makes the following incidental or consequential provisions which appear to him to be necessary or desirable for giving effect to the objects of this Proclamation, namely Then there follow clauses suspending the operation of certain ministerial sections of the Constitution Act and certain sections referential to legislative machinery of . ", "6. Mr. in his very full and exhaustive argument has attacked the validity of the 1944 Act on four grounds: ", "(1) That the Governor legislating under Section 93 of the Constitution Act has not power to legislate retrospectively at all; ", "(2) That itself cannot legislate retrospectively in the concurrent field, and it is said that the law we are concerned with is in the concurrent field; ", "(3) That Sections 9 and 14 of the 1944 Act are void, because they interfere with the powers and jurisdiction of contrary to the proviso to Section 93 of the Constitution Act; and (4) That has not power to interfere with the powers and jurisdiction of . ", "7. With regard to the first ground, there is no question as to the retrospective operation of the 1944 Act. Section 2 and Schedules A and B and Sub- section 9(2) , which deals with the period from April 6, to May 12, 1944, make this retroactive operation abundantly clear. So far as the retroactive operation of the exercise of legislative powers is concerned, there is no difference between the position of the Governor General under Section 72 in the Ninth Schedule to the Constitution Act and the position; of a Provincial Governor under Section 93 . Indeed the contrary has not been contended. The position in this respect of the Governor General is covered by authority which is binding upon us. In the case of Emperor v. (1943) 46 Bom. L.R. 50 F.B., which is a decision of a full bench of , the validity of Ordinance XIV of 1943 promulgated by the Governor General under Section 72 in the Ninth Schedule was challenged, and the Chief Justice, Sir , said this (p. 52): ", "It is argued, in the first instance, that that Ordinance was beyond the powers of the Governor General under Section 72 of the Ninth Schedule to the Government of India Act. But there is really no substance in that point. Under that section the Governor General may, in cases of emergency, make and promulgate Ordinances for the peace and good government of British India or any part thereof, and any Ordinance so made shall, for the space of not more than six months from its promulgation, have the like force of law as an Act passed by . That is the material part of the section, and the limitation of six months has been removed by the St. 3 and 4 Geo. VI. c. 33. ", "It is said that the Governor General cannot pass a retrospective ordinance. But as this Ordinance is to have the like force of law as an Act passed by the Indian legislature, and it has not been disputed that the Indian legislature can pass a retrospective Act, there seems to be no force in that contention. ", "Nor is there any force in the contention that the Governor General cannot amend an existing Act of the Indian legislature. The same reasoning applies to that. The Indian legislature can amend an Act, and, therefore, the Governor General can under Section 72 . This Court very recently upheld a retrospective Ordinance made by the Governor General in .. ", "8. The second ground is that itself cannot legislate retrospectively in the concurrent field, i.e. in respect of the subject-matters enumerated in list III in the seventh schedule of the Constitution Act , and it is suggested that the 1944 Act deals with the subject-matters enumerated under item 4 \"Civil Procedure\", item 8 \"Transfer of property\", item 10 \"Contracts\" and item 15 \"Jurisdiction and powers of all Courts\". But even if this was so, the answer in this case is that the Governor General has given his assent to the 1944 Act; and Mr. concedes that if there was any repugnancy, it is cured by such assent : (See Section 107(2) ). There is also authority for this in the judgment of Mr. Justice in v. (1939) 3 Fed. L.J. 1 5. Mr. , however, says that notwithstanding this there is a distinction in the case of a law which as here is to have retrospective effect. In my opinion, there is no substance in this point. The Governor General has given his assent to the 1944 Act, which is retrospective on the face of it. ", "9. It is the third ground which really forms Mr. 's main assault upon the validity of the 1944 Act. Clearly the proviso to Section 9 of that Act deals with matters which are within the jurisdiction of to determine, such as whether the tenant has committed an act contrary to the provisions of Section 108 of the Transfer of Property Act, 1882, or has been guilty of conduct which is a nuisance or an annoyance to any adjoining or neighbouring occupiers. The granting of a certificate with regard to these matters is placed in the hands of an executive officer, a Controller, with an appeal to another executive officer, namely the Collector. Further, by Section 14 it is expressly provided that shall have jurisdiction to settle, decide or deal with any question which is by or under this Part required to be settled, decided or dealt with by the Controller and Collector. ", "Mr. points to the proviso to Section 93 of the Constitution Act relating to , and he then invites attention to Section 223 of that Act, which is as follows: ", "Subject to the provisions of this Part of this Act, to the provisions of any Order in Council made under this or any other Act and to the provisions of any Act of the appropriate enacted by virtue of powers conferred on that by this Act, the jurisdiction of, and the law administered in, any existing , and the respective powers of the judges thereof in relation to the administration of justice in the court, including any power to make rules of court and to regulate the sittings of the court and of members thereof sitting alone or in division courts, shall be the same as immediately before the commencement of Fart III of this Act. ", "10. Two things should be observed : In the first place, there is nothing in the Proclamation itself by which the Governor has assumed to himself any power of or suspended, either in whole or in part, the operation of the Constitution Act so far as it relates to High Courts. In the second place, it is provided by Sub- section 93(4) that any reference in this Act to Provincial Act s, Provincial laws or Acts or laws of shall be construed as including a reference to such a law, i.e. a law made by a Governor. Under Section 93 such a law is to have the same force and effect as a law enacted by . The question is : does the proviso refer to the powers with which the Governor may invest himself under the Proclamation, or does it cut down or restrict what he may do if he invests himself as he has done with the same plenary 'powers as ? In my opinion, it must be the former. If it were the latter, he could not change the law at all, since he would be suspending the operation of the law as administered in as it stood immediately before he assumed the powers under the Proclamation. Be it observed that Section 223 itself is made \"subject to the provisions of any Act of the appropriate \", and the Governor is the appropriate . is a Provincial authority within the meaning of Section 93 ; and, in my judgment, the effect of the proviso is to prevent the Governor from assuming or suspending the powers and jurisdiction of by any Proclamation under Section 93 , but does not extend to alteration of the law by or under the assumed legislative powers which are within the competency of , once the Governor has assumed those powers. In my opinion, this is clear when Section 93 is analysed. It provides that in the event therein mentioned the Governor may, by Proclamation, assume to himself all or any of the powers vested in, or exercised by, any Provincial body or authority. As I have already said, is such an authority. Then there follows an incidental particularization of some of the things the Proclamation may contain, including provisions for suspending in whole or in part the operation of any provisions of the Act relating to any Provincial authority. Then follows the proviso. In my opinion, the assumption and the suspension mentioned in the proviso are referential to the assumption mentioned in Sub- section 93(1)(b) and the suspension mentioned in the particularization of the subject-matters which the Proclamation may contain. In the result this attack on the validity of the 1944 Act also fails. ", "11. That brings us to the fourth ground, which is, whether could have passed the 1944 Act. The only argument addressed to us on this point is founded on Clause 44 of the Letters Patent, which declares that all the provisions of the Letters Patent, and it is Clause 12 which gives jurisdiction, are subject to the legislative powers of the Governor General as therein mentioned. There is nothing1 in this point, since by the conjoint effect of Section 293 of the Constitution Act and Sections 2 and 7 of the Government of India (Adaptation of Indian Laws) Order of 1937 the reference to the Governor General in Clause 44 of the Letters Patent refers to all other competent authorities. ", "12. It must follow that as a result this action must be dismissed. ", "Kania, J. ", "13. These proceedings were started by the plaintiff landlord in August 1941 under the Presidency Small Causes Courts Act to eject his tenant on whom the notice to quit was duly served on April 29, 1941. The relevant provisions of the Government of India Act, the Proclamation issued by the Governor of Bombay under Section 93 , and Bombay Act VII of 1944 enacted by the Governor, have been set out in the judgment of the learned Chief Justice. The only point urged before us is whether Bombay Act VII of 1944 is ultra vires. If the contention fails, these proceedings must be dismissed. ", "14. The argument that Bombay Act VIII of 1944 is ultra vires is based on four contentions. They are set out in the judgment of the learned Chief Justice. The first contention is that the Governor has no authority to make retrospective legislation and his powers are not co-extensive with those of . For this counsel relied on the words of the proviso to Section 93 of the Government of India Act, which was contended to limit the Governor's powers, It was argued that in King-Emperor v. [1944] F.C.R. 1 expressed the view that an Ordinance, issued by the Governor-General in exercise of his powers under Section 72 of the Government of India Act, cannot be made retrospective. It was contended that the powers of the Governor acting under Section 93 had the same limitations, and therefore the Governor had no power to make retrospective laws. This argument is unsound because did not decide that point in case. The Court only discussed the various aspects of the powers of the Governor General acting under Section 72 and at p. 15 stated: ", "As the general question framed by cannot be satisfactorily answered without further discussion of the above and other similar aspects of the problem, we refrain from expressing any final opinion upon it, as no such decision is necessary for the disposal of \"these cases. ", "The argument advanced before was in respect of Sections 2 and 3 of Ordinance XIV of 1943. thus declined to express any definite opinion in respect of Section 2 , while in respect of Section 3 it decided that the same was valid. On the other hand our in expressed the opinion that in construing emergency legislation it is not necessary to express words or necessary intent to make the same of retrospective effect, unlike the normal rule of construction applicable to Acts passed in normal times. A full bench of this Court in Emperor v. (1943) 46 Bom. L.R. 50 F.B. held that the Governor General's powers to make retrospective Ordinance was valid and relied on the previous decision of this Court in (supra). In order to consider whether the Governor has such power or not the relevant question is what is the position of the Governor on the issue of a proclamation under Section 93 . If his powers are the same as of , he has the power to pass laws having retrospective effect. This cannot be disputed because , within the orbit of its legislative sphere, has plenary powers, and all legislatures having plenary powers are held to have power to make laws with retrospective effect within the scope of its authority. This contention will therefore depend on the decision of the third contention urged on behalf of the landlord. ", "15. The second contention is that cannot legislate retrospectively on matters falling in the concurrent list. It was not disputed that in respect of the exclusive list II, found in the seventh schedule of the Constitution Act , had authority to pass a law having retrospective effect. The contention was that in respect of the concurrent list had not unconditional and absolute plenary powers because had also authority to pass laws on the same matters. I apprehend that the two questions are mixed up in advancing this argument. The first question is whether the Act passed by the appropriate authority in respect of a concurrent list is valid or not. The second question is whether, it being valid, there can remain any objection to its validity on the ground that it has been given retrospective effect. The question of validity of the Act must depend on the true construction of Section 100 and Section 107(2) of the Government of India Act. In v. had occasion to distinguish the spheres of the separate lists and the concurrent list found in the seventh schedule to the Constitution Act . It observed (p. 57): ", "On a very strict interpretation of Section 100 , it would necessarily follow that from all matters in list II which are exclusively assigned to , all portions which fall in list I or list III must be excluded. Similarly, from all matters falling in list III, all portions which fall in list I must be excluded. The section would then mean that has full and exclusive power to legislate with respect to matters in list I, and has also power to legislate with respect to matters in list III. A has exclusive power to legislate with respect to list II 'minus matters falling in list I or list III, has concurrent power to legislate with respect to matters in list III, 'minus matters falling in list I'. In its fullest scope Section 100 would then mean that if it happens that there is any subject in list II which also falls in list I or list III it must be taken as cut out from lislt II. On this strict interpretation there would be no question of any real overlapping at all. If a subject falls exclusively in list II and no other list, then the power of is supreme. But if it does also fall within list I, then it must be deemed as if it is not included in list II at all. Similarly, if it also falls in list III, it must be deemed to have been excluded from list II. The dominant position of with regard to matters in list I and list III is thus established. But the rigour of the literal interpretation is relaxed by the use of the words 'with respect to' which as already pointed out only signify 'pith and substance,' and do not forbid a mere incidental encroachment. But, even if such an accidental encroachment may be ordinarily permissible, the field may not be clear. There may be competency and yet repugnancy also. The question is how to prevent a clash, if the trespass is on a field already occupied by . ", "Under Section 107(2) it is clear that in respect of an item found in the concurrent list if an Act of exists and passes an Act, the same has to receive the consent of the Governor General. The effect of such consent is also provided for in the same section. The effect is that in the Province the Provincial Act is supreme. It is further provided that this need not prevent from further passing an Act, if it was so minded, but its authority to pass such Act is circumscribed by the previous consent of the Governor-General being obtained to introduce any Bill for that purpose. Therefore, once it is found that the sanction of the Governor-General under Section 107(2) in respect of a Provincial Act has been obtained, there can remain no question of repugnancy. In the Province, the Provincial Act has the overriding force. Once that stage is reached, I do not see how the question of the Act being ultra vires, because it gives retrospective effect, remains. The Governor-General having given consent to the Provincial Act , is given power to pass that law and it is valid. If so, the same is within the powers of . , having plenary powers, is entitled to enact a law having retrospective effect, and I do not see any difference in the position of an Act passed in respect of an item mentioned in the concurrent list, which has obtained the consent of the Governor-General, and an Act passed in respect of a matter in the exclusive list, after both are held valid. This argument must therefore fail. ", "16. The third contention was subdivided under four heads. It was first contended that the power of the Governor to interfere with the jurisdiction of was expressly excluded by the proviso to Section 93(1) of the Government of India Act of 1935. A similar provision, with regard to the Governor-General containing a similar proviso, is found in Section 45 , when the machinery of breaks down. The bearing of the two sections on the scheme of the Constitution Act has therefore to be considered together. The argument is put thus : By the proviso it is enacted that nothing in the sub-section shall authorise the Governor to suspend, either in whole or in part, the operation of any provision of this (Constitution) Act that relates to . It was argued that Section 223 of the Constitution Act maintained the jurisdiction of as it existed till then. By that section the proper authority was given power to interfere with that jurisdiction. Therefore, Section 223 was a provision of the Constitution Act relating to , and the operation of that section covered the exercise of jurisdiction of the existing s. The proviso to Sections 9 and 14 of the Act VII of 1944, during the existence of that Act, prevented from exercising its jurisdiction in respect of Section 108 of the Transfer of Property Act and administering that law in and thus suspended the operation of Section 223 of the Constitution Act. The Bombay Act therefore clearly infringed the words of the proviso and was invalid. In order to appreciate the force of this argument, it is necessary to scrutinise the scheme of Section 93 . The section provides for the assumption by the Governor of a province of the government, when a situation had arisen under which the government could not be carried on in accordance with the provisions of the Constitution Act . The first part of the sub-section provides that in such circumstances and with that object the Governor may by a proclamation (a) declare that its function shall be exercised by him in his discretion, and (b) assume to himself all or any of the powers vested in or exercisable by any provincial body or authority-Clause (b) only is relevant for the present discussion. The Governor, therefore, by a proclamation can assume to himself all the powers of any provincial body or authority. Inasmuch as of a province exercises jurisdiction and has powers exercisable within the province, it is a provincial authority. If the section stopped there, it could be contended that when issuing the proclamation the Governor could state that he would assume the functions of . The first part of the proviso prevents that possibility. The second part of the sub-section proceeds to state that any such proclamation may contain incidental and consequential provisions, as may be necessary to the objects of the proclamation, including provisions for suspending the operation of any provision of this Act relating to any provincial body or authority. (I have omitted the words which are not material for the present discussion). Therefore, in the proclamation the Governor is given further power to make incidental and consequential provisions which are to attain the objects of the proclamation. Such provisions may include the suspension of the operation of certain provision of the Constitution Act which relate to a provincial body of authority. The second part of the proviso follows the exact words of the last part of the sub-section. The result, therefore, is that if the words in the second part of the proviso did not exist, although the Governor may not assume powers under Clause (b), in including incidental and consequential provisions in the proclamation he may suspend the operation of any section relating to . The second part of the proviso prevents him from doing so. That appears to be the plain scheme of Sub-section (1) read with the proviso. ", "17. The question to be determined is whether the Governor when acting under Section 93 has infringed the words of this proviso. He has not assumed any of the powers of . He has not suspended the operation of any provision relating to it. The answer, therefore, to the argument advanced on behalf of the landlord is clearly in the negative. The approach to Section 223 , contained in the argument advanced on behalf of the plaintiffs, is erroneous because in passing Act VII of 1944 the Governor has not suspended the operation of any provision relating to , but in fact he is acting under Section 223 . By the proclamation he has assumed all the legislative functions which are vested in . The result is that after the proclamation he becomes , and for the purpose of passing laws in respect of any items mentioned in list II or list III he is the proper legislative authority within the meaning of Section 223 . The contention that the Bombay Act trespasses on or curtails the jurisdiction of is confusing the issue. The only question before the Court is whether the Governor in assuming the powers which he is entitled to under Section 93 has suspended the operation of Section 223 . The answer clearly is in the negative, because, firstly, he has not so stated in the proclamation, and, secondly, he has not suspended but is acting under Section 223 . It may be argued that this construction renders the proviso quite ineffectual. In my opinion, that is not correct. Under Section 223 the alteration in the jurisdiction of and the law administered in any existing , can be effected by a provision or any Order-in-Council made under the Constitution Act , or any Act of the appropriate . The last would include an Act of the Central . Item 15 in list III in the seventh schedule gives authority to the Central to pass laws in respect of jurisdiction and powers of all , which would include a . If the Governor, acting under Section 93 , proclaimed that a portion of Section 223 was suspended, while he himself retained, the power to act in the capacity of a Provincial to pass laws in respect of the matters included in list II and list III to the extent the field was not already occupied by any Central Act , he would deprive the authority entitled to issue an Order-in-Council and the Central from passing any Act which would affect the jurisdiction of or the law administered in the Provincial . It is clear that the proviso is framed to prevent the Governor from creating that situation. In my opinion, this construction of Section 93 and Section 223 is perfectly logical and according to the scheme of the Government of India Act. Therefore, the contention that the proviso prevents the Governor from enacting Bombay Act VII of 1944 is unsound. ", "18. The second branch of the argument under this heading was that the powers are limited to the purposes mentioned in Section 93 , and in this connection counsel referred to Sections 88 and 89 of the Constitution Act. It was urged that in these sections the powers of the Governor are limited to the purposes mentioned therein. This argument is unsound, because the powers under each section are controlled by what is mentioned in the particular section. It is true that in the present case the powers to be assumed by the Governor are for the purposes mentioned in Section 93 . But it is irrelevant to consider whether; the passing of Bombay Act VII of 1944 is for the purpose of Section 93 . The two questions are quite independent. For the purpose of Section 93 the only question is whether the Governor has assumed the necessary powers required to achieve the objects mentioned therein. It has nothing to do with the question whether the exercise of the legislative functions, which are vested in him on the assumption of powers under Section 93 , is for the purpose of Section 93 . ", "19. The third part of this argument was that the 'law passed by the Governor' is not an Act of the , and, therefore, the words of Section 223 are not complied' with. It is described as the law. In this connection counsel relied on the interpretation clause Section 311(6) and Section 311(2) , which defined the Provincial Act and the Provincial Law. This contention overlooks the express words of Section 93(4) . The concluding words of that sub-section clearly show that wherever there is a reference to Provincial Act in the Constitution Act , the same is to include the Governor's law passed under Section 93 . Reference to Section 311(6) is not useful because the general interpretation clause need not necessarily repeat what had already been provided by the in Section 93(4) . This argument therefore has no substance. ", "20.The last argument advanced under this heading was the same as the fourth contention advanced in a different form. The contention was that Clause 44 of the Letters Patent can be altered only by and not by , and therefore much less by the Governor acting under Section 93 . This contention overlooks the provision made in the Government of India (Adaptation of Indian Laws) Order, 1937. Section 293 of the Constitution Act is wide enough to cover the Letters Patent, as a law, according to the last sub-clause of that section. Under Section 2(2) of the Adaptation of Laws Order, 1937, 'Indian law' includes every law which is covered by Section 293 of the Constitution Act. Under Section 7 of the Adaptation of Laws Order \"proper authority\" is the authority entitled to legislate on the subject in question. Reading all these together, it is clear that the proper authority to legislate in respect of the matter in question is . As the powers of , by virtue of the Proclamation issued under Section 93 , are now vested in the Governor, the proper is the Governor. This contention therefore must also fail. ", "21. I therefore agree that the proceedings adopted by the plaintiffs must fail and should be dismissed. ", "22. Per Curiam. Certificate, under Section 205 of the of India Act, to issue. With regard to costs, this matter is admittedly within jurisdiction. It was transferred to on the application of as raising a question of public importance. It is true that the litigating parties did not object; but the result has been that considerably more costs have been incurred, whilst have got a decision upon this matter of public importance. In the exercise of our discretion we think that the fair and proper order to make in these circumstances with regard to the first defendant's costs is, first, to quantify them at Rs. 1,000 (one thousand) including all previous orders for costs, and then to direct that half that sum should be paid by the plaintiffs and half by the second defendant. Defendant No. 2 will bear his own costs."], "relevant_candidates": ["0000794487"]} {"id": "0001471689", "text": [", J. ", "1. The facts of this case are as follows : In this case one had obtained a decree against defendants 1 and 2 in S.C.S. N0.296 of 1915. In execution of that decree (E. P. No. 959 of 1915) the decree-holder attached the suit property. The order to attach was made on nth August, 1915 and the attachment was actually made on 6th September, 1915. The sale was posted to 8th January, 1916. On 6th January, 1916 the present 3rd defendant filed a claim petition. On 8th January, 1916, the sale was adjourned to 15th January, 1916, in order to enable the to enquire into the claim. But the claim petition was actually disallowed only on 17th January, 1916. The order disallowing the claim petition runs as follows : \" In these two cases rival claimants have preferred claims to the property in dispute. The judgment-debtors are minors and two persons purporting to be their guardians have sold in one case the whole property and in another half the property to the two purchasers respectively who are adjacent land owners. The contest is practically between the two claimants and a suit is inevitable. On the grounds that the claims have been preferred too late and the delay is not satisfactorily explained, I disallowed the claim.\" Seeing that the attachment was made on the 6th September, 1915 and the claim petition was filed on 6th January, 1916 it is difficult to believe that there was such a serious delay in the case as to justify a dismissal without enquiry. It is doubtful that the District Munsif really meant to dismiss the claim petition on the ground of delay in view of his remark \" The contest is practically between two rival claimants and a suit is inevitable.\" He seemed to think that whatever his order was, a regular suit was so certain that to enquire into the merits at that stage would be a waste of time and it was desirable to avoid waste of time at that stage. It is, therefore, difficult to construe the District Munsif's judgment as one dismissing the petition on the ground of delay in spite of the express statement to that effect. If the judgment of the District Munsif cannot be regarded as one disposing of the claim petition on the ground of delay, then the decision in (1918) ILR 41 M 985 : 35 MLJ 335 (FB) does not apply; and the issue which raises the question of title will have to be gone into. But I do not wish to rest my judgment in this case solely on this ground in view of the ambiguous nature of the District Munsif's order. Mr. has contended that E. P. No. 959 of 1915 was dismissed and with its dismissal the attachment has ceased to exist under Rule 57 of Order 21, Civil Procedure Code. The E. P. No. 959 of 1915 with all orders thereon up to 1st February has now been exhibited in Second Appeal as Ex. A. E. P. No. 196 of 1916 is exhibited as Ex. B. What happened was that on 17th January, 1916, after the claim petition was disallowed the decree-holder requested the to stop the sale. At any rate that is the note made on the execution petition. Mr. who appears for the respondent now suggests that that was not the result of the unwillingness on the part of the decree-holder to proceed with the sale but it was at the suggestion of the District Munsif that he stated he would file another petition and was willing to withdraw the same. He relies on E. P. No. 196 of 1916 which was filed on the 31st January, 1916, and on which an order was made directing notice for fresh proclamation. This was ordered on 21st February, 1916. In that petition, the petitioner stated that the suggested that another petition may be filed on 1st February. No doubt the facts are somewhat suspicious and support Mr. ar's suggestion. But the first petition was not very old at the time and there does not seem to be any particular reason why the District Munsif should be anxious to have it taken out of the file for statistical purposes being only five months old and suggest to the party to file another petition. If the District Munsif did so for such purposes no doubt it is improper. The decree-holder seemed to be willing to oblige the District Munsif. Anyhow he was willing that the fact should appear as if he was not prepared to proceed with the E. P. No. 959 of 1915 on 17th January, 1916. The final order in E. P. No, 959 of 1915 on the 1st February was that the petition was dismissed. Whatever the effect of that order was between the decree-holder and the judgment-debtor, persons who are not parties to the execution proceedings and who do not know all that passed between the and the decree-holder are entitled to rely on the fact that the petition was dismissed on account of the unwillingness of the decree-holder to proceed with E. P. No. 959 of 1915. The result of this was that the attachment ceased to exist under Order 21, Rule 57. Though a fresh order on E. P. No. 196 of 1916 was taken without a fresh attachment and is final and binding between the decree-holder and the judgment-debtor and cannot be questioned on account of want of attachment, the present 3rd defendant is entitled to rely on the result of the dismissal of the earlier petition and say that the attachment has ceased to exist so far as he is concerned. ", "2. If the attachment has ceased to exist the next question that arises is whether the order on the claim petition, dated 17th January, compels the 3rd defendant to set it aside within one year and precludes him from raising his title in the absence of his suit within one year. On this question it is convenient if I make an extract from my judgment in A.S. No. 36 of 1920 referring this identical point to the Full Bench. ", "3. The appellant next contends that the order of 8th August, 1916, has not got to be set aside because the attachment to get rid of which, the claim petition was filed, had ceased to exist. ", "4. I will first observe that the effect of an order on a claim petition may be different according as the judgment-debtor is or is not a party to the inquiry. It was pointed out in (1902) ILR 25 M 721 : 12 MLJ 411 that the judgment-debtor may not be a party to the inquiry on the claim petition and in such a case the order though in favour of the claimant and opposed to the judgment-debtor's rights need not be conclusive against the judgment-debtor if no suit is filed by him within one year to set it aside. Conversely, if adverse to the claimant and in' favour of the judgment-debtor it need not be set aside by the claimant to the full extent it may sound in favour of the judgment-debtor and has to be set aside only so far as the order is in favour of the decree-holder concerned. If the judgment-debtor is a party, then the order on the claim petition decides not only questions between the claimant and the decree-holder, but also questions between the claimant and the judgment-debtor, the latter being in general much broader in scope than the former. To put it in other words : as soon as a claim petition is filed, there are three possible parties to the inquiry--the claimant, the decree-holder and the judgment-debtor and we may have two classes of cases : (1) Cases in which all three are parties. In such a case an order against the claimant will be wider in scope and has effects reaching much farther than in the second class. (2) Cases in which the claimant and the decree-holder are the only parties. In this case the order is narrower in scope and its consequences are not so far-reaching as in class (1). ", "5. An example will make my meaning clear. A obtains a decree against for Rs. 200 and attaches a house worth Rs. 3,500. claims ownership of the house and objects to the attachment. If A, and are parties to the inquiry and the claim petition is dismissed, it is obvious that the effect of the order is to hold that is not the owner of the house and is the owner, the order in favour of operating to help A and other creditors of . A regular suit by in such a case to set aside the order to the fullest extent has to be valued at Rs. 3,500 and has to be filed in a ourt competent to try that suit. ", "6. But if only A and are parties to the inquiry, the effect of the dismissal of 's petition is simply to hold that A has got a right to pursue the attachment and has not got a right to object to the attachment. It is not to decide that is not the owner of the property and that B is. A regular suit to set aside the order should be valued at Rs. 200 and not at Rs. 3,500 and may be filed in the District Munsif's ourt. It may be that the reason of the order is that is not the owner and it may be that, in the regular suit that follows, the issue that may be framed relates to the title of (especially so if B is a party to the suit). These remarks follow from v. Somasundaram hettiar (1907) ILR 30 M 335 : 17 MLJ 95 ( <ITATION> (1910) ILR 34 M 533 and <ITATION> (1919) 37 MLJ 547. I will refer to these cases later on again, but at present I have made these general remarks as it is useful to remember the distinction in the discussion of cases. ", "7. The earliest case on the point raised before us is (1882) ILR 8 C 379. At page 281, Tottenham, J. says : \" The finding of the in the execution department that the sale was invalid only meant that the sale was invalid as against the judgment-creditor, and as against any purchaser who might purchase at a sale held in execution following that attachment. \" In view of the latter clause, I do not see what meaning can be obtained by laying special emphasis on the words \" against the judgment-creditor. \" It may be that the reason of the order on the claim petition in that case was that the sale was made during attachment (see Section 64 of the present Code) but I do not see what argument can be derived from this fact unless the order on the claim petition which held that \" the sale was invalid \" expressly limited the operation of the order to claim petitions objecting to the particular attachment and saved other claim petitions to other possible attachments. The fact remains that the claim was dismissed with a general opinion that the sale was invalid without any limitation on the effect of the opinion. ", "8. The next case is Ibrahimbai v. (1888) ILR 13 B 72. Bird-wood, J. said : \"The second attachment was a new and distinct act giving a new cause of action on which the plaintiff is entitled to a fresh enquiry and decision.\" This was followed in v. Bai (1893) ILR 18 B 241 in which Sargent, C. J. says \"when that attachment was removed by the judgment-creditor's own act on 20th November, 1888, there was no longer an attachment or any other proceedings, etc.\" (1903) ILR 31 C 228 their Lordships say at page 231 : \"The object of the claim preferred by the plaintiff under Section 278, Civil Procedure Code, was to obtain the removal of the attachment, and when that attachment had been removed after payment of the decretal amount there was no longer an attachment or any proceeding in execution on which the order could operate to the prejudice of the plaintiff, and therefore there was no necessity to hiring a suit to set aside the order We are unable to accept the view suggested on behalf of the appellants that, in spite of the withdrawal of the attachment, the dismissal of the claim under Section 281, Civil Procedure Code, could, by virtue of the provisions of Section 283, Civil Procedure Code, have the effect of finally determining the question of title between the parties. \" ", "9. The next case is (1905) ILR 29 M 225 : 16 MLJ 136. It does not appear clearly from the facts whether the judgment-debtor was a party to the claim proceedings though, on the whole, it looks as he was not. The order on the claim petition was held conclusive against the claimant as between and a subsequent vendor from the judgment-debtor. I am indebted to my learned brother (, J.) for the suggestion that this case can be justified on the ground that the subsequent vendor paid off the amount of the decree in execution of which the claim was preferred and may therefore be regarded as having been subrogated to the rights of the execution-creditor. This was not the actual ground of the judgment which seems to proceed on a too literal reading of Section 283. The learned Judges distinguish the cases in (1882) ILR 8 C 279 Ibrahimbai v. (1888) I LR 13 B 72, v. Bai Divali (1893) ILR 18 B 241 and (1963) ILR 31 C 228 on the ground that in all these cases, the raising of the first attachment was within a year of the order on the claim proceedings. I find it difficult to follow this ground of distinction. In the first place, if it is conceded that the order becomes useless and inoperative when the attachment ceased within one year of the order, this is a concession not allowed by the literal reading of the section. Secondly, if the operativeness of an order on a claim petition is to be regarded as conditional on the continuance of the attachment, it is difficult to see why the cession of the attachment within one year should destroy the operativeness and the cessation of it beyond one year should have just the opposite effect merely because a suit to set aside could not be brought more than one year after the date of the order. It seems to me a novel legal conception. Thirdly, the fact that the decrees were paid off within one year seems to be an accident. Not one of the eight Judges laid any emphasis on the fact. The only difference I can see between the two cases (the raising of the attachment within one year and its raising beyond one year) is that in the former case, the unsuccessful claimant who waits incurs no risk as he knows for certain within one year that the attachment in execution of it has ceased to exist and in the latter he takes a risk by not suing as he cannot be certain that the attachment will be raised. But I do not see why when the event, on which he takes his chance, viz., the cessation of the attachment by the payment of the decree or for other reason, happens, he should not take advantage of it simply because he took risks in so waiting. This distinction has not been approved by , J., in (1919) 37 MLJ 547 and the decision in (1905) ILR 29 M 225 : 16 MLJ 136 must be regarded as unsound except on the ground that the judgment-debtor must be regarded as a party to the order on the claim proceedings. This is how it was treated in all cases in which it was cited with reference to this point in Krishnaswami Naidu v. Somasundaram Chettiar (1907) ILR 30 M 335 : 17 MLJ 95 ( (1914) 26 MLJ 499. In my opinion, after these cases, it is futile to rely on (1905) ILR 29 M 225 : 16 MLJ 136 as an authority of any value. ", "10. Another distinction has been suggested by the respondents in respect of the cases in (1882) ILR 8 C 279, Ibrahimbai v. (1888) ILR 13 B 72, v. Bai Divali (1893) ILR 18 B 241 and (1903) ILR 31 C 228. It is said that the question of the collusiveness of the order arose in a proceeding unconnected with the decree in the execution of which the claim was preferred. (1882) ILR 8 C 279 and Ibrahimbai v. (1888) ILR 13 B 72 the point arose in connection with the execution of a second decree though in (1882) ILR 8 C 279 it was a second decree based on the same right as the first. In v. Bai Divali (1893) ILR 18 B 241 and (1903) ILR 31 C 228, the question arose in later suits unconnected with the decree though in the former the party opposed to the unsuccessful claimant was the successful decree-holder claiming in some other right. The contention amounts to this, viz., the order is conclusive against the claimant in so far as he seeks to resist the particular decree though the attachments may be different but not conclusive as against different decrees though of the same decree-holder and a fortiori of different decree-holders. The distinction no doubt helps the respondents in the present case but is opposed to the decision in v. (1917) MWN 851. Incidentally I may observe this distinction concedes that the decisions in (1905) ILR 29 M 225 : 16 MLJ 136 and in (1920) ILR 44 M 268 : 40 MLJ 7 are erroneous and that the language of Order 21, Rule 63 should not be taken too literally. 1 think the distinction in so far as it seeks to apply the conclusiveness of an order to different attachments in execution of the same decree is opposed to the principle of Krishnaswami Naidu v. (1907) ILR 30 M 335 : 17 MLJ 95 (FB) the reasoning in which equally applies to a case where there is a decree for costs to the extent of Rs. 200 and for mesne profits of the value of Rs. 3,500 and the first attachment was for costs only and the latter attachment is for the mesne profits. I also observe that the emphasis in all the four cases is on the non-identity of the attachments and not of the decree as the words underlined by me in the quotations from those judgments show. ", "11. If the language of Order 21, Rule 63 is read literally it may apply not only- ", "(a) to claimants resisting rights worked out in pursuance of the attachment to which the claim is made (in my opinion the operation of the rule ought to be confined to this class) but also to ", "(b) (1) between the claimant and other attachments under the same decree; ", "(2) between the claimant and attachments under other decrees of the same decree-holder; ", "(3) between the claimant and the decree-holder, whatever the right be on which he relies; ", "(4) between the claimant and all other decree-holders of the same judgment-debtor and all other persons claiming rights against the same judgment-debtor such as mere creditors who have not obtained decrees; ", "(5) between the claimant and judgment-debtor (including his assignees); ", "(6) between the claimant and all persons, (even if unconnected with the judgment-debtor) interest in denying the title of the claimant.[ (1919) 37 MLJ 547 at 549]. ", "12. To allow the extension of the section so as to apply to class (6) is to create a species of orders in rem which are unknown except in Probate and Matrimonial proceedings. Even the doctrine of res judicata does, not apply so as to bar a person A from urging his right against C by reason of a former adjudication (adverse to A) between A and B. [Justice points out in Sri Rajah Kakarlapudi Suryanara-yarinraju Garu v. Chellamkuri Chellamma (1870) 5 MHCR 176 that such a plea is allowed in Continental jurisprudence]. ", "13. To allow the extension to class (5) is to ignore the distinction between the cases where a judgment-debtor is a party and where he is not which I pointed out at the beginning of the judgment. , ", "14. To allow the extension to class (4) is to imagine that mere simple creditors and money decree-holders have got some interest in the property of their debtors and judgment-debtors though there is no charge on the property and not even attachment of it. ", "15. To allow the extension to classes (2) and (3) is to imagine that a person A, by merely obtaining a decree against B and attaching B's property under it has got a right to predicate that B is the owner of the property and not C for the purpose of all possible decrees he may obtain against B and all other purposes in respect of which he may come into conflict with C--a right unknown to law. ", "16. To allow the extension to class (1) is inconsistent with v. (1907) ILR 30 M 335 : 17 MLJ 95 (FB) and ignores the possibility of a decree being paid up by the judgment-debtor, or of an attachment being raised. ", "17. My view is supported by the two Bombay decisions and the two Calcutta decisions I have already mentioned by (1914) 26 MLJ 499 (though the point was not necessary for the decision) by Gollampalli Subbayya v. (1917) MWN 851 (a very strong case on the facts) and by (1920) ILR 45 B 561. (1905) ILR 29 M 225 : 16 MLJ 136 the only decision in favour of the appellants is (1920) ILR 44 M 268 : 40 MLJ 7. I have already commented on this in (1921) 41 MLJ 198 and one of the decisions I have referred to in this judgment except Gollampalli Subbayya v. (1917) MWN 851 has been cited in it. It was based on a decision in 27 IC 800 in which the only question decided was whether the suit abated by reason of the satisfaction of the decree. The Code provides for no abatement except on death. Their Lordships held that the suit did not abate. I do not think it is permissible to infer from this that the order on the claim inquiry continues operative after the cessation of the attachment in a case where no suit was filed. I think the filing of the suit makes all the difference. The decisions in (1916) 31 MLJ 247, (1919) 37 MLJ 159 and (1919) 38 MLJ 397 do not help us as they are plain examples of the application of Order 21, Rule 63 without the complications of the Cessation of the first attachment. I think the decisions in (1920) ILR 44 M 268 : 40 MLJ 7 and Gollampalli Subbayya v. (1917) MWN 851 are irreconcilable. Some reliance has been placed on the language of Section 64 of the Code. When we remember that Section 64 and Order 21, Rules 58--62 used to be in the same chapter of the former Codes, Section 64 supports my view and shows that the object of the in providing against obstacles and objections to an attachment is the protection of rights created in pursuance of the attachment only.\" ", "18. The view I there took was that an order on a claim petition is final against the claimant in so far as the rights worked out in pursuance of the particular attachment are concerned. The only thing that I would now add in addition to the reasons given there is that Order 21, Rule 58 runs : \"Where any claim is preferred to, or any objection is made to the attachment of, any property attached in execution of a decree on the ground that such property is not liable to such attachment, etc. \" The language of the rule, especially the words \" such attachment \" I think, supports my reasoning in the passage quoted above. Seeing that there are a number of decisions of taking this view, namely, (1914) 26 MLJ 499, Gollampalli Subbayya v. (1917) MWN 851 and (1910) ILR 34 M 533 inasmuch as my learned brother agrees with my view, I do not think it is necessary to refer this case to solely on account of the decision in (1920) ILR 44 M 268 : 40 MLJ 7. The second appeal will, therefore, be allowed and the suit remanded for fresh disposal as regards 3rd defendant. The appellant will have a refund of the -fees paid in this and in the Lower Appellate . Costs in the first appeal and second appeal will be paid by the appellant as he has not raised the point about the cesser of attachment by filing the two execution petitions which have not been exhibited. Costs in the of first instance to abide the result. ", ", J. ", "19. I agree and have nothing to add."], "relevant_candidates": ["0000142574", "0000195752", "0000521025", "0000887594", "0000995696", "0001208642", "0001227114", "0001348902", "0001398152", "0001624779", "0001633933", "0001940545"]} {"id": "0001481214", "text": ["PETITIONER: C.N. RUDRAMURTHY Vs. RESPONDENT: K. BARKATHULLA KHAN & OTHERS DATE OF JUDGMENT: 08/10/1998 BENCH: CJI, G.B. PATTANAIK, . ACT: HEADNOTE: JUDGMENT: ", "J U D G M E N T , J. ", "The appellant filed a suit against , the original tenant in occupation of a premises bearing No. 199 and 200 situated at Brigade Road in Bangalore city for recovery of possession thereof on the ground that he had defaulted in payment of rent and had sublet the same contrary to law. The original tenant set up the defence that he had not sublet the suit premises or any portion thereof, but had only entered into an agreement to run business on his behalf and he was not liable to be evicted. The original tenant died on 8.1.1983 and his legal representatives were brought on record. They filed a written statement on 1.8.1984 contending that their father had parted with possession of the suit premises to respondent No.1 and no decree could be passed against them. Respondent No.1 was impleaded as a defendant on an application made by him. He contended that he had become a partner with with the consent of the appellants and partnership stood dissolved as on 10.12.1982 and thus he was a tenant under the appellant directly. His tenancy had not been terminated and, therefore, there was no cause for suit. By a decree made on 31.3.1993, directed the eviction of the first respondent. Respondent No.1 preferred an appeal against the said decree in . This appeal is against that order made by . This appeal is against that order made by of Karnataka in that appeal filed by respondent No.1 In three principal points were formulated for consideration :- ", "(1) Whether the first respondent is a tenant? If not, what is his status? ", "(2) Whether the suit is maintainable for ejection of the first respondent? ", "(3) Whether the first respondent is entitled for mesne profits under Order XX Rule 10 of the C.P.C.? The first two points raised for consideration turned on the question whether the first respondent is a tenant or not? If he is a tenant, it was stated that the matter has necessarily to go before for eviction under Section 21 of the Karnataka Rent Control Act (hereinafter referred to as \"the Act\"). However, he is liable for eviction by virtue of a decree in the suit. The below to pay rents or difficulty in answering the third point raised for consideration. What is really in issue before us are the first two points. ", " held that there is no acceptable evidence to declare the first respondent as a tenant and thereby affirmed the conclusion reached by the trial court. After examining the scope of Section 23 of the Karnatak Rent Act which forbids creation of sub-lease or assignment or transfer either whole or any part of the demised premises, the learned Judge was of the view that the original tenant allowed others to carry on the business in his name as he was unable to carry on the business by himself due to old age initially by inducting the first respondent as a partner of the firm and then in his own capacity as a owner of the business concern which was not an unknown mode of transfer of tenancy and, therefore, the first defendant was not a trespasser. He, however, noticed that the first respondent was not inducted with the consent of the landlord and therefore his possession becomes unlawful and he is liable to be evicted under the provisions of Section 21(1)(f) of the Karnataka Rent Control Act and no other conclusion was possible in this regard. In view of that finding he held that has no jurisdiction to pass an order of eviction as there is a specific provision ousting the jurisdiction of to entertain any suit for eviction of a tenanted premises. On that basis, he allowed the appeal and set aside the decree dame by the trial court and directed the parties to work out their remedies in . ", "In this background a contention was raised on behalf of the appellant that Section 31 of the Karnataka Rent Control Act enabled the filing of the suit as the rent in respect of the same was above Rs.500/- per month. held that Section 31 of the Karnataka Rent Control Act had been declared invalid in vs. State of Karnataka ILR 1986 Kar 2480. The view expressed by this Court in Civil Appeal No.13754 of 1996 entitled was also brought to the notice of which reads as follows :- \"In view of the decision of this Court in and others versus Union of India 1995 (1) S.C.C. 104, this appeal would merit acceptance and accordingly we accept the same, set aside the impugned orders of and restore that of with regard to possession of the property in dispute as well as entitlement of the appellant to contractual rent up till the date of vacating for which item is being allotted hereby to the respondents.\" ", "While considering the question whether the decision of this Court in case had impliedly overruled the decision of in case, held that the decision laid down in reported in , should be followed and the decision in case had no application. ", "In case (supra) this Court was concerned with a provision under the Delhi Rent Control Act and Section 3(c) made it clear that the Act was not applicable to any premises whether residential or non-residential whose monthly rent exceeds three thousand rupees which is akin to the provision under Section 31 of the Karnataka Rent Control Act. In case had proceeded to rely upon case; when the matter was brought to this Court though no specific reference was made to case, this Court stated that the law laid down in case would be applicable, it was not open to to state that it would prefer to follow the decision in case. Indeed it is a matter of judicial discipline that required that when this Court states as to what the law on the matter is, the same shall be binding on all the Courts within the territory of India. This mandate of Article 141 of the Constitution is not based on any doctrine of precedents, but is an imprimatur to all courts that the law declared by this Court is binding on them. If that is so, it was not open to to consider the effect of the decisions in case, its scope, what was decided therein and whether there could be any distinction between that decision and the decision rendered in case. The clear pronouncement made by this Court in case was that case was applicable with reference to Section 31 of the Karnataka Rent Control Act and, therefore, in view of that decision, 's decision was upset in another matter where had followed the case. In effect, case stood impliedly overruled. Thus, it was not at all open to to have tried to explain the decision of this Court and ought to have implicitly followed the decision of this Court. The law declared by this Court is clear that the 's case was applicable to the provisions of Karnataka Rent Control Act. So it was not open to the learned Judge to take any other view in the matter. Thus we are of the view that the direction issued by to the parties to work out their remedies under the Rent Control Act is not at all correct. ", "Hover, learne counsel for the responents submitte that there has been no ecision of this irectly stating that the law eclare by in case was not correct an, therefore, the view taken in case may be examine by us an may either uphol the view expresse therein or take another view though such a course was not open to . We o not think such an exercise is necessary when this applie its min to the facts of the case, the law eclare by this in 's case an applie the same with reference to the provisions of the Karnataka Rent Control Act. If there has to be any change in the policy, it is certainly open to the to intercee it an make appropriate law in that regar. Therefore, this argument avance on behalf of the learne counsel for the contesting responent oes not appeal to us. yet another argument was presse upon us to the effect that when a provision of law in an enactment has been eclare to be invali an when eclares the law with reference to another enactment of similar nature, it woul not be open to to say that the ecision of this shoul be taken to have been overrule or upset the ecisions renere by eclaring the law to be invali. This principle has no application in the present case at all because this itself consiere the effect of case with reference to the provisions of the Karnataka Rent Control Act an applie the same thereto an thereafter eclare what the law shoul be. Though this i not specifically referre to the ecision in case, it is neeless to say that the same stoo overrule because the law eclare by this was contrary to what was state in case. Therefore that argument also is not soun an nees to be rejecte. It is submitte that if take the view that Section 31 of the Karnataka Rent Act is vali in view of 's case, then the enactment will keep out of its purview large number of premises inasmuch as the rent payable in respect of commercial premises in Bangalore will certainly be more than Rs. 500/- per month. We have given our careful consieration to this aspect of the matter. Relying upon the ecisions in 1998 (2) SCC 1, 1986(3) SCC 385, . 1984(1) SCC 222, . 1990(1) SCC 109, 1988 (1) SCC 366, it was submitte that with passage of time an change of circumstances the continue operation of an Act which was vali re enacte may become invali as being arbitrary an unreasonable. Though Karnataka Rent Control Act was enacte in the year 1961 an was to lapse by the en of 10 years time, it has been extene from time to time in the same form in which it was enacte originally or with some moification wherever it was necessary. We cannot imagine that the was not aware or conscious of the fact as to the rents prevalent in the city of Bangalore or in other parts of the State in respect of non-resiential premises. Perhaps, the thought it was necessary to give protection of the Act to only very poor tenants who pay rent less than Rs.500/- per month consiering the fact that tenants in other premises are economically of superior class an can withstan the maneuvers of a lanlor hover porful he may be. If that was the policy of the law, o not think as state in case, it was open to the to have eclare the same to be invali. In the result, are of the view that the ecree passe by the trial court is to be restore by setting asie the orer mae by an orer accoringly. The appeal, therefore, stans allo. Hover, consiering all aspects of the matter, are of the opinion that the first responent be given some reasonable time to vacate the premises an which in this case consier will be a perio upto 30th of June, 1999 subject to the filing of usual unertaking within four eks from toay. In the event such an unertaking is not file before this , it woul be open to the appellant to seek for immeiate eviction in aition to the conition that he shall vacate the premises an eliver the same on or before 30th of June, 1999. ", "CIVIL APPEAL NO. 5040 OF 1998 ARISING OF SPECIAL LEAVE PETITION (CIVIL) NO. 4557 OF 1998. ", "In view of the decision rendered by us in Civil Appeal arising out of Special Leave Petition (C) No. 6836 of 1996, the view taken by has got to be upheld and this appeal deserves to be dismissed. However, the appellant is granted time to vacate the premises on or before 30th of June, 1999 upon his furnishing the usual undertaking in this Court within four weeks from today."], "relevant_candidates": ["0000340697", "0000511417", "0001246561", "0001351547", "0001490167", "0001803657"]} {"id": "0001496005", "text": ["PETITIONER: EDIGA ANAMMA Vs. RESPONDENT: STATE OF ANDHRA PRADESH DATE OF JUDGMENT11/02/1974 BENCH: , V.R. BENCH: , V.R. SARKARIA, RANJIT SINGH CITATION: 1974 AIR 799 1974 SCR (3) 329 1974 SCC (4) 443 CITATOR INFO : F 1974 SC1039 (12) F 1974 SC2281 (6) RF 1975 SC 573 (9) F 1976 SC 653 (13) F 1976 SC2071 (4,5) RF 1976 SC2386 (4) RF 1977 SC 949 (18,19) R 1977 SC1747 (6) RF 1977 SC1812 (2) E 1979 SC 916 (6,45,86,198) R 1979 SC1384 (10,12) RF 1980 SC 898 (81,82,197,198) MV 1982 SC1325 (38,69,71) RF 1983 SC 361 ((2)4,10,21) D 1983 SC 465 (9) RF 1985 SC 231 (2) ACT: Criminal Law--Practice and Procedure--Offence of murder--Circumstances justifying lesser sentence. HEADNOTE: The appellant, a rustic young woman, flogged out of her husband's house by her father-in-law, was living with her parents with her only child. She committed a premeditated, cleverly planned murder of another young woman and her child because of rivalry between the appellant and the murdered woman for the affections of an illicit lover. awarded the death sentence and confirmed. In appeal to this Court. HELD : The death sentence must be dissolved and life sentence substituted. (i) Modern penology regards crime and criminal as equally material when the right sentence has to be picked out although in our processual system there is neither comprehensive provision nor adequate machinery for collection and presentation of social and personal data of the culprit to the extent required in the verdict on sentence. However, in the Criminal Procedure Bill, 1973, has wisely written into the law a post conviction stage when the judges shall \"hear the accused on the question of sentence and then pass sentenced on him according to law.\" [334 C] The unmistakable shift in legislative emphasis is that life imprisonment for murder is the rule and capital sentence the exception to be resorted to for reasons to be stated. The disturbed conscience of the state on the vexed question of legal threat to life by way of death sentence has sought to express itself legislatively, the stream of tendency being towards cautious partial abolition and the retreat from total retention. [336 H] Code of Criminal Procedure Section 367(5) as amended by Act 26 of 1955; Criminal Procedure Bill, 1973, Sections 235, 238 and 354(3); Indian Penal Code (Amendment) Bill, 1972, Section 122 , referred to. (ii) The case on hand has to be disposed of under the present Code and the Court has to fall back upon the method of judicial bunch in imposing or avoiding capital sentence aided by such circumstances as are present on the record introduced for the purpose of proving guilt. [334 D] (iii) In the present case the criminal's social and personal factors, her feminity and youth, her unbalanced sex and expulsion from the conjugal home and being the mother of a young boy-these individually inconclusive and cumulatively marginal facts and circumstances tend towards awarding of life imprisonment. [339 B--C] Further, the Sessions Judge pronounced the death penalty on December, 31, 1971 and the appeal is being heard in February 1974. This prolonged agony has ameliorative impact according to the rulings of this Court. A.I.R. 1944 F.C.I.; , 1973 C.L.J. 1773; , A.I.R. 1973 S.C. 2699. referred to. JUDGMENT: ", "CRIMINAL APPELLATE JURISDICTION : Criminal Appeal No. 67 of 1973. ", "Appeal by Special Leave from the Judgment and Order dated the 24th March, 1972 of in Criminal Appeal No. 12 of 1972 and Referred Trial No. 1 of 1972. ", "330 ", ", amicus curiae for the appellant. and for the respondent. The Judgment of the Court was delivered by , J. In a rural region of Andhra Pradesh Freudian fury or explosion of sex jealousy expressed itself in a gruesome murder of a young woman and her tender child by the accused, :a young woman, with an only child ten years old, all, because notwithstanding both being married, they had invested amorous affections in a middle-aged libertine. , conveniently a widower. It is an admitted fact that the accused, although married, was keeping illicit relations with , a shepherd, but she discovered that lately her paramour was on flirting contacts with the deceased. This knowledge angered her so much that she extinguished the life of her rival on November 4, 1971 in the afternoon in a jungle, manipulating her murderous venture so cleverly that for a time people thought that she was the murdered and searched for her body. Closer enquiry revealed that the victim was and the other innocent one her baby less than two years old. ", ", appearing as amicus curiae, has presented a painstakingly meticulous argument on behalf of the prisoner, who has been condemned to death by the courts below. It is but meet that we appreciate the industrious advocacy enthusiastically made by this young advocate. By sundown on November 4, 1971 a cadaver was found in a field outside the village of Konapur, Medak District, Andhra Pradesh. The deceased was a damsel who was first mistaken to be the accused because her face had been burnt out of recognition and on her body was found clothing which belonged to the accused a deviced to, as later evidence discloses, by the accused to throw enquirers off ,the scent. On November 8, 1971 the dead body of a baby, . daughter of , the deceased, was recovered, from the sand bed ,of a stream near the field. Investigations disclosed that . the accused, was the perpetrator of this fiendish crime. She was duly prosecuted, convicted and sentenced to death for the offence of murder and life imprisonment for secreting evidence of the crime, 'under s. 20 1 , 1 . P. C. An appeal by the accused and a referred trial under the Code resulted in a Bench of affirming the guilt and upholding the sentence. A jail appeal has come before us, argued by as amicus curiae. ", "The people involved are more or less primitive rustics and sex inhibitions do not appear to have interdicted private philandering. The prisoner had been married to P.W. 7 of Ankenpally, three miles distant from Konapur where her parents resided. Carnal knowledge with P.W. 16 developed even when she was in her husband's house and she manifested her passion by stealing gold rings from the house of one to make it over to P.W. 16 as a memento of her illicit love, Indeed, this little stealing, induced by her improper relations with P. W. 16, was discovered. She suffered flagellation from her father-in-law for this act, and her father, P.W. 2, removed her to his own house as a sequel. The setting of Konapur did not stand in the way of her continued intimacy with who responded by shifting to this village himself. ", "The deceased, , was the wife of P.W. 12 who was, as ill-luck would have it, the neighbour of the accused's family. Opportunity tempted and also established erotic contact with that lascivious, P.W. 16. The prisoner, in due course, came to know about the shifting of affections by her paramour who tried to bluff her in vain. Fired by jealously the prisoner fixed her mind upon liquidating her rival. ", "On November 4, 1971 at about 3 p.m. the ill-starred had left for the fields taking the baby with her. The accused tempted and shadowed her, with some clothes from her house, to be washed in the village stream. P. W. 15, P. W. 4 and P. W. 13 have given testimony which, if believed, will show that the accused and the deceased were seen together in the fatal field at about 5 p.m., the day the mother and child died. It is said that the accused had removed a chisel from her house as she proceeded to the field and used it to lethal purpose. The medical evidence shows that and were stabbed to death with a chisel identified by the accused's own father, , and the blacksmith who made it, P.W. 15. Apparently overborne with uncontrollable hatred for the woman who hijacked her paramour's sexual affection, the accused had planned to kill with cunning. The manner of stabbing to death was bad enough; it was more brutal for her to have disfigured the face of the victim which was found burnt. With a view to mislead and thereby evade easy detection she removed from the deceased's body her clothes and clothed it with a language belonging to herself. She removed the child's body, wrapped it in a piece of cloth brought by her and buried it beneath the river sand. Thereafter she made towards the house of P. W. 11, her uncle, told P. W. 16 what she had done and pressed him to elope with her. The sense of safety of P.W. 16 prevailed over his urge for sex relations with this girl and so he declined to follow her. The disparate woman left for her husband's village, while a search for her was being made by her father. The dead body in the field was found covered with the accused's clothing and beguiled by this circumstance reported to the police , P.W., 5 (Ex. P 1) that his daughter had been murdered, perhaps by her father-in-law. Taken in by this report, the informed the police and the Sub- Inspector, 6, proceeded to the scene of occurrence, held inquest and sent the body for postmortem examination. 2, the doctor, did the autopsy in the afternoon of November 5. 1971 and the body was brought back to Konapur by sundown. The Inspector of Police took over the investi- gation, took into custody the clothes\" near the scene and questioned a number of persons in the village. The tragic body was being made ready for cremation when the of village Ankanpally, P.W. 10, moved down to the place with the accused, to the bewilderment of the people gathered. Meanwhile, P.W. 12, the husband of , finding his wife and child missing, went in search of them vain. The tidings came of the dead body and the revelation that it was not that of the accused, as originally suspected. So apprehension turned on the dead body being that of . They went to the place but it was night and the next morning, i.e., November 6, 1971, P. W. 12the husband-and -examined the corpse and to their shock discovered it to be the body of . A , P-10, was prepared. P.W. 12 reported to the police officer, 7 (Ex. P-2) and investigations revived in the new direction. P. W. 27 sent for the accused, who wanted to see her son, and they all met at the police station. P.W. 16 turned up at the police station, and breaking down perhaps under the stress of all that had happened, the accused said that she would confess. Ex. P- 7, the confession, was recorded which led to the discovery of the child's body, the bundle containing the burnt clothes and chisel, etc. (Ex. P-8). The langha of the accused was also recovered (Ex. P-9). Post-mortem was done over the body of the child, the accused was arrested and eventually she was charged with offences under S. 302 and s. 20 1 , I. P. C of course, there is no direct evidence in the case but the prosecution has placed a clinching wealth of circumstances and an extra-judicial confession to P.W. 16 to substantiate its version. It is trite law that Ex. P-7, the confession made while in police custody, is inadmissible except to the narrow extent salvaged by discoveries made in terms of S. 27 of the Evidence Act. We are left, therefore, with the confessional statement made to P.W. 16 orally. If it can be invested with veracity the guilt of the accused is virtually made out. But it is common-place law-and vehemently urged- that a retracted confession made orally to a near-villain like P.W. 16, who had reason to play for safety, was liable to be rejected without a second look at the statement. -and -have considered the many weaknesses relating to this confession. Those defects have been pointed as deadly by counsel for the appellant. We are satisfied that the credence given to it by the courts below cannot be treated as strange or otherwise seriously erroneous. Certainly he had no ill-feeling for the accused and nothing palpably improbable has been made out in the spontaneous unburdening of her bosom by the accused in distress, hastening to her paramour after the murder in the hope that she would now vanish with her lover, and telling him the murderous truth. Marginal mistrust generated by counsel's argument is inadequate to reject the testimony of P.W. 16. However, there are circumstances attaching to his whereabouts and the slight delay in his statement to the police and the dubiety of his character which permitted his openly wearing a stolen gold ring received from another man's wife. It is but fair, therefore, for the to search for convincing corroboration. The precedents cited before us by counsel for the appellant take us no further than the need to ask for satisfactory reinforcement of a retracted confession not too good to be treated as sufficient in itself to fasten the guilt. ", "333 ", "We are, therefore, thrown to the task of evaluating the circumstances and the extent to which they buttress up the self-incrimination content in the confession- Motive by itself is not much, particularly in the absence of direct evidence, but in the company of other factors it plays a probative role. The discovery of the child's dead body and the clothes belonging to the accused, as well as the chisel of P. W. 2, the father, which was admittedly missing, are a clear pointer to the guilt, although by themselves do not cover the entire distance from \"may be\" to \"must be\" in the proof of guilt. The noose of guilt is tightened by the testimony of P.Ws. 4, 13 and 15. P.W. 13, the mother-in-law of , deposed that the deceased, her daughter-in-law, went out to fetch vegetables from the fields and the accused was seen following her with a bundle of clothes to wash them in the stream. P. W. 15, an apparently disinterested man, speaks of having seen the accused at Khallam at about 5 p.m. near where the deceased also was. Although the trial court did not choose to believe him, the appellate court thought that it was not risky to rely on his testimony. swore. to having seen the accused at Khallam at about sundown on the relevant date. This shepherd also states that he saw the deceased collecting firewood near about there and heard the cries of a girl. There has been a detailed discussion of the evidence of these witnesses by and notwithstanding the attempt elaborately made by , the evidence of these witnesses has not been fractured or rendered incredible. ", "The fact that the accused was seen last with the deceased in a place where and at a time when few others were around, the fact that the deceased's body was covered cleverly by the clothes of the accused-foolishly, as we now see by hind- sight-the discovery of telltale clothes on the baby's body, the lethal chisel, her blood-stained skirt concealed in the bush, all strongly probabilise the truth of the confession. In a well-considered judgment the learned Judges of have covered all the relevant evidence and reached the unhesitating conclusion that the accused had done to death and . persistent effort to attack almost every part of the prosecution evidence testifies to his industry, which we appreciate, but hardly carries conviction. All the circumstances converge towards the focal point of guilt of the accused, her fatuous assumption that others would be deceived along a wrong trail has failed, and the impending cremation which would have blotted out a vital evidence was averted and truth has come out. We have hardly 'any doubt that the conviction deserves to be confirmed. ", "Counsel for the correctly drew our attention to 'the great limitations on the exercise of the extraordinary jurisdiction under art. 136 of the Constitution, particularly, when dealing with the concurrent findings of fact. He is right in contending that we, should dismiss arguments which nibble at the credibility of witnesses. But finding the case hanging on a retracted extra-judicial confession from 9--L954 Sup CI/74 a person who does not necessarily inspire great confidence, corroborated only by circumstantial evidence, we thought it proper to make a conscientious search to see, if truth had been reached and miscarriage of justice averted. We are satisfied, as already stated, that the accused's guilt, to the extent human instruments can apprehend, has been made out. ", "Guilt once established, the punitive dilemma begins. The choice between death penalty and life term has to be made in a situation which is not altogether satisfactory. Modern penology regards crime and criminal as equally material when the right sentence has to be picked out, although in our processual system there is neither comprehensive provision nor adequate machinery for collection and presentation of the social and personal data of the culprit to the extent required in the verdict on sentence. However, in the Criminal Procedure Code , 1973, about to come into force, has wisely written into the law a post-conviction stage when the Judges shall \"hear the accused on the question of sentence and then pass sentence on him according to law.\" (S. 235 & s. 248 ). ", "The case on hand has to be disposed of under the present Code and we have to fall back upon the method of judicial hunch in imposing or avoiding capital sentence, aided by such circumstances as are present on the record introduced for the purpose of proving guilt. We are aware that in .(1), there was an argument about the absence of procedure laid down by the law for determining whether the sentence- of death or something less is appropriate in the case. The Court viewed this Criticism from the constitutional angle and observed : ", "\"The is primarily concerned with all the facts and circumstances in so far as they are relevant to the crime and how it was committed and since at the end of the trial he is liable to be sentenced, all the facts and circumstances bearing upon the crime are legitimately brought to the notice of the court. Apart from the cross-examination of the witnesses. the Criminal Procedure Code requires that the accused must be questioned with regard to the circumstances appearing against him in the evidence. He is also questioned generally on the case and there is an opportunity for him to say whatever he wants to say. He has a right to examine him- self as a witness, thereafter, and give evidence on the material facts. Again he and his counsel are at liberty to address the court not merely on the question of guilt but also on the question of sentence. In important cases like murder the court always gives a chance to the accused to address the court on the question of sentence.\" \"The sentence follows the conviction, and it is true that no formal procedure for producing evidence with reference (1) 1 S. C. C. 20. ", "335 ", "to the sentence is specifically provided. The reason is that relevant facts and circumstances impinging on the 'nature and circumstances of the crime are already before the court.\" ", "In any scientific system which turns the focus, at the sentencing stage, not only on the crime but also the criminal, and seeks to personalise the punishment so that the reformatory component is as ,much operative as the deterrent element, it is essential that facts of a social and personal nature, sometimes altogether irrelevant if not injurious at the stage of fixing the guilt, may have to be brought to the notice of the when the actual sentence is determined. ", "The prisoner is a young woman of 24 flogged out of her husband's house by the father-in-law, living- with her parents with her only child sex-starved and single. The ethos of the rural area where the episode occurred does not appear to have been too strict or inhibitive in matters of sex, for the deceased and the accused were both married and still philandered out of wedlock with , a middle-aged widower who made no bones about playing the freelance romancer simultaneously with them. Therefore, the accused incautiously slipped down into the sex net spread by , and while entangled and infatuated, discovered in the deceased a nascent rival. With the reckless passion of a jealous mistress she planned to liquidate her competitor and crudely performed the double murder, most foul. Perhaps it may be a fable extenuation to remember that the accused is a young woman who attended routinely to the chores of domestic drudgery and allowed her flesh to assert itself salaciously when invited by uncensured opportunity for lonely meetings with . It may also be worth mentioning that, apart from her youth and womanhood, she has a young boy to look after. What may perhaps be an extrinsic factor but recognised by the court as of humane significance in the sentencing context is the brooding horror of 'hanging' which has been haunting the prisoner in her condemned cell for over two years. The Sessions Judge pronounced the death penalty on December 31, 1971, and we are now in February 1974. This prolonged agony has ameliorative impact according to the rulings of this Court. The leading case in (1) was relied upon by this Court in (2). The following passage from the decision is telling : ", "\"In committing the offence the appellant must have been actuated by jealousy or by indignation either of which would tend further to disturb the balance of his mind. He has besides been awaiting the execution of this death sentence for over a year. We think that in this case a sentence of transportation for life would be more appropriate than the sentence of death.\" ", "(1) A. 1. R. [1944] F. C. L (2) (1974) C. L. J. 1775. ", "336 ", "The decision in (1) strikes a similar note. Although this consideration is vulnerable to the criticism made by counsel for the that as between two capital sentence cases that which is delayed in its ultimate disposal by the courts receives the less terrible punishment while the other heard with quick despatch, for that very reason, fails to relieve the victim from condemnation to death. ", "In this unclear situation it is unfortunate that there are no penological guidelines in the statute for preferring the lesser sentence, it being left to ad hoc forensic impressionism to decide for life or for death. Even so, such sentencing material as we have been able to salvage from the guilt material in the paper book persuades us to award life imprisonment to the prisoner and modify to that extent the death sentence imposed by the courts below. It behaves us to indicate why we have chosen this course. In the twilight of law in this area, we have been influenced by the seminal trends present in the current sociological thinking and penal strategy in regard to murder. We have also given thought to the legal changes wrought into the penal code in free India. We confess to the impact made on us by legislative and judicial approaches made in other countries although we have warned ourselves against transplanting into our country concepts and experiences valid in the West. ", "It cannot be emphasised too often that crime and punishment are functionally related to the society in which they occur, and Indian conditions and stages of progress must dominate the exercise of judicial discretion in this case. In India the subject of capital punishment has abortively come before earlier, although our social scientists have not made any sociological or statistical study in depth yet. On the statutory side there has been a significant change since India became free. Under s.367(5) of the Criminal Procedure Code , as it stood before its amendment by Act 26 of 1955, the normal rule was to sentence to death a person convicted for murder and to impose the lesser sentence for reasons to be recorded in writing. By amendment, this provision was deleted with the result that the court is now free to award either death sentence or life imprisonment, unlike formerly when death was the rule and life term the exception, for recorded reasons. In the new Criminal Procedure Code , 1973 a great change has overtaken the law. Section 354(3) reads : ", "\"354(3) When the conviction is for an offence punishable with death or, in the alternative, with imprisonment for life or imprisonment for a term of years, the judgment shall state the reasons for the sentence awarded, and, in the case of sentence of death, the special reasons for such sentence.\" ", "The unmistakable shift in legislative emphasis is that life imprisonment for murder is the rule and capital sentence the exception to be (1) A. 1. R. 1973 S. C. 2699. ", "337 ", "resorted to for reasons to be stated. In this context it may not be out of place to indicate-not that it is conclusive since it is now tentative that under the Indian Penal Code (Amendment) Bill, 1972, s. 302 of the Penal Code has been substituted by a less harsh provision limiting death penalty to a few special cases (vide s. 122 of the new bill). ", "It is obvious that the disturbed conscience of the on the vexed question of legal threat to life by way of death sentence has sought to express itself legislatively, the stream of tendency being towards cautious, partial abolition and a retreat from total retention. ", ") has adjudged capital sentence constitutional and whatever our view of the social invalidity of the death penalty, personal predilections must bow to the law as by this Court declared, adopting the noble words of Justice of California uttered in a death sentence case : \"As a judge, I am bound to the law as I find it to be and not as I fervently wish it to be\". (The Yale Law Journal, Vol. 82, No. 6, P.1138). Even so, when a wise discretion vests in the court, what are the guidelines in this life and death choice ? The humanism of our Constitution, echoing the concern of the Universal Declaration of Human Rights, is deeply concerned about the worth of the human person. Ignoring the constitutional content of (2), and ), the humanist thrust of the Judicial vote against cruel or unusual punishment cannot be lost on the Indian judiciary. The deterrence strategists argue that social defence is served only by its retention,-thanks to the strong association between murder and capital punishment in the public imagination,-while the correctional therapists urge the reform of even murderers and not to extinguish them by execution. History hopefully reflects the march of civilization from terrorism to humanism and the geography of death penalty depicts retreat from country after country. The U.K. and the U.S.A. are notable instances. Among the socialist nations it has been restricted to very aggravated forms of murder. The lex talionis principle of life for life survives in some States still, only to highlight that in punitive practice, as in other matters we do, not live in 'one world' but do move zigzag forward to the view that the uniquely deterrent effect of death penalty is, in part, challenged by jurists, commissions and statistics. But as a counterweight we have what an outstanding justice of the Ontario appeal court said some years ago(4) \"The irrevocable character of the death penalty is a reason why all possible measures should be taken against injustice-not for- its abolition. Nowadays, with the advent of armed criminals and the substantial increase in armed robberies, criminals of long standing if arrested, must expect long sentences. ", "However, if they run no risk of hanging, when found guilty of murder, they will kill policemen and witnesses with the prospect of a future no more unhappy, as one of them put it. than being fed, lodged, and clothed for the rest of their lives.\" ", "(1)[1973] 1 S. C. C. 20. ", "(2) 100 California Reporter 152 (3) 408 U. S.-218 (4) Capital Punishment-Thorstn Sellin P. ", "83 ", "338 ", "The final position, as we see it, is neither with the absolute abolitionist nor with the Mosaic retributions. It is relativist, and humanist, conditioned by the sense of justice and prevailing situation of the given society. In England, men once believed it to be just that a thief should lose his life (as some Arab Chieftains do to-day) but the British have gone abolitionist now without regrets. In contemporary India, the via media of legal deprivation of life being the exception and long deprivation of liberty the rule fits the social mood and realities and the direction of the penal and processual laws. ", "While, deterrence through threat of death may still be a promising strategy in some frightful areas of murderous crime, to espouse a monolithic theory of its deterrent efficacy is unscientific and so we think it right to shift the emphasis, to accept composite factors of penal strategy and not to put all the punitive eggs in the 'hanging' basket but hopefully to try the humane mix. ", "We assume that a better world is one without legal knifing of life, given propitious social changes. Even so, to sublimate savagery in individual or society is a long experiment in spiritual chemistry where moral values, socioeconomic conditions and legislative judgment have a role. Judicial activism can only be a signpost, a weather vane, no more. We think the penal direction in this jurisprudential journey points to life prison normally, as against guillotine, gas chamber, electric chair, firing squad or hangmen's rope. 'Thou shalt not kill' is a slow commandment in law as in life, addressed to citizens as well as to States, in peace as in war. We make this survey to just if your general preference where s.302 keeps two options open and the question is of great moment. Let us crystallise the positive indicators against death sentence under Indian Law currently. Where the murderer is too young or too old, the clemency of penal justice helps him. Where the offender suffers from socioeconomic, psychic or penal compulsions insufficient to attract a legal exception or to downgrade the crime into a lesser one, judicial commutation is permissible. Other general social pressures, warranting judicial notice, with an extenuating impact may, in special cases, induce the lesser penalty. Extraordinary features in the judicial process, such as that the death sentence has hung over the head of the culprit excruciatingly long, may persuade the court to be compassionate. Likewise, if others involved in the crime and similarly situated have received the benefit of life imprisonment or if the offence is only constructive, being .under s. 302 read with s. 149 , or again the accused has acted suddenly under another's instigation, without premeditation, perhaps the court may humanely opt for life, even like where a just cause or real suspicion of wifely infidelity pushed the criminal into the crime. On the other hand, the weapons used and the manner of their use, the borrandous features of the crime and hapless, helpless state of the victim, and the like, steal the heart of the law for a sterner sentence. We cannot obviously feed into a judicial computer all such situations since they are astro- logical imponderable in an imperfect and undulating society. A legal policy on life or death cannot be left for ad hoc mood or individual predilection and so we have sought to objectify to the extent possible, abandoning retributive ruthlessness, amending the deterrent creed and accenting the trend against the extreme and irrevocable penalty of putting out life. ", "Here, the criminal's social and personal factors are less harsh, her feminity and youth, her unbalanced sex and expulsion from the conjugal home and being the mother of a young boy-these individually inconclusive and cumulatively marginal facts and circumstances tend towards award of life imprisonment. We realise the speculative nature of the correlation between crime and punishment in this case, as in many others, and conscious of fallibility dilute the death penalty. The larger thought that quick punishment, though only a life term, is more deterrent than leisurely judicial death award with liberal interposition of executive clemency, and that stricter checking on illicit weapons by the police deters better as social defense against murderous violence than a distant death sentence, is not an extraneous. component in a court verdict on form of punishment. ", "We have indicated enough to hold that, marginal vaccination notwithstanding, the death sentence must be dissolved and life sentence substituted. To this extent the appeal is allowed, but otherwise the con- ", "viction is confirmed. ", " ", "Appeal allowed in part. ", "340"], "relevant_candidates": ["0000095498", "0000637593", "0001481954", "0001837051"]} {"id": "0001496509", "text": ["PETITIONER: DELHI JUDICIAL SERVICE ASSOCIATION TIS HAZARICOURT, DELHI ET Vs. RESPONDENT: STATE OF GUJARAT AND ORS. ETC-ETC. DATE OF JUDGMENT11/09/1991 BENCH: , K.N. (J) BENCH: , K.N. (J) KULDIP (J) KASLIWAL, (J) CITATION: 1991 AIR 2176 1991 SCR (3) 936 1991 SCC (4) 406 JT 1991 (3) 617 1991 SCALE (2)501 ACT: Constitution of India; 1950: Articles 32, 129, 136, 141, 142, 246,374(2) and Schedule VII List 1, Entry 77. Contempt of --Punishment of--Power and jurisdiction of --Held has inherent power and jurisdiction to take action for contempt of subordinate or inferior courts also-Power to be exercised sparingly--Only when contempt is likely to have repercussions throughout the country. Contempt of -- as s of Record have inherent power and jurisdiction to take action for contempt of subordinate or inferior courts-- having judicial. superintendence over all courts in the country has same jurisdiction. Contempt of --Civil and criminal contempt--Criminal contempt--Wide enough to include any act which would tend to interfere with administration of justice or which would lower the dignity and authority of court. Chief Judicial Magistrate--Assaulted, arrested on flimsy grounds, handcuffed, tied with rope, photographs taken and published by Officers--Held constituted clear case of criminal contempt--Contemners-punishment--Quantum of punish- ment determined according to degree and extent of part played by each contemner--Guidelines laid down by in case of arrest and detention of a Judicial Officer--To be followed by State Governments as well as --Judicial Officer not to visit Station--Except in connection with official and judicial duties and with prior intimation to District and Sessions Judge. Contempt proceedings in --Dispute regarding facts-- Judge appointed as er--Inquiry made, evidence recorded and report submitted--Held contem- ners not persons accused of an offence. 937 --Supervisory and appellate jurisdiction of-Plenary jurisdiction unaffected by self imposed restric- tions of the --From plenary jurisdiction flows supervi- sory jurisdiction over all courts and in India. 's jurisdiction and power not limited--Can determine its own jurisdiction and it will De final. taking cognizance of contempt matter arising out of an 2incident subject matter of trial before a criminal court--Has ample power to do complete justice and prevent abuse of process of court--'Cause' or 'matter' includes proceeding pending in Civil or criminal matter-Need to do 'complete justice' would depend on facts and circumstances of case. precedents--Decisions of Federal --Not binding but entitled to great weight--Changes brought about by Constitu- tion to be kept in mind while considering Federal , decisions. Contempt of s Act , 1971--- Sections 2(c) , 12 and 15 . Criminal contempt--Object of punishing contemner--To protect administration of public justice--Not to protect Judges personally. Officers assaulting, arresting and handcuffing Chief Judicial Magistrate--Publishing photographs in news- papers--Held constituted criminal contempt--Punishment to contemners determined having regard to degree and extent of part played by each contemner-Guidelines laid down by Su- preme to be followed by State Governments and while arresting Judicial Officers. Criminal contempt proceedings different from ordinary crimi- nal proceedings. \"s of Record'--Have power to summarily punish for contempt of court-- Contempt of s Act 1971 does not curtail inherent power of to punish for con- tempt. Statutory Interpretation. Constitution--Interpretation of. Not.permissible to adopt a construction which would render any expression super-fluous or redundant-Regard to be had to the social, economic and political changes, need of the Community and the independence of the judiciary-- 938 cannot be a helpless spectator bound by prece- dents of colonial days which have least relevance. Criminal Procedure Code , 1973. Section 6 and Chapter XII. Chief Judicial Magistrate--Position and role of--Coordi- nation, Cooperation of police necessity for -- to be scrupulously fair to offender--Magistrate to ensure fair investigation and }air trial of offender--Magistracy and police--Purpose and object--Complementary to each other--Judicial officer not to visit police station except in connection with official and judicial duties and with prior intimation to District and Sessions Judge. Words and Phrases--Meaning 'Contempt'-- Contempt of s Act 1971: Section 2(c) .. ' of record'--Constitution of India---- Article 129. 'Persons accused o fan offence'---constitution of India, Article 20(3). Including the power to punish for contempt of itself--Constitution of India, Article 129. 'Complete Justice'--Constitution of India, Article 142 (1). HEADNOTE: Mr. was posted as Chief Judicial Magistrate at Nadiad in October, 1988. He soon found that the local was not cooperating with the courts in efficting service of summons, warrants and notices on accused persons, as a result of which the trials of cases were delayed. He made complaint against the local police to the District Superintendent of and forwarded a copy of the same to the Director General of but nothing concrete hap- pened. On account of these complaints, Mr. , Inspector, Nadiad was annoyed with the Chief Judicial Magistrate and he withdrew constables posted in the CJM . In April 1989, the CJM filed two complaints with the against the Inspector and other Offi- cials, Nadiad for delaying the process of the . On 25th July, 1989, the CJM directed the police to register a crimi- nal case against 14 persons who had caused obstruction in judicial proceedings but subsequently since unqualified apology was tendered, the CJM directed the Inspector to drop the cases. The Inspector reacted strongly to the CJM's direction and he made complaint against the CJM to the Registrar of the through the District Super- intendent of . On account of the aforesaid facts there was hostility between the of Nadiad and the CJM. 939 On 25th September 1989, the Inspector met the CJM in his chambers to discuss a case where the had failed to submit the charge-sheet within 90 days. During discussion the Inspector invited the CJM to visit the police station to see the papers and assured him that he would mollify the sentiments of the police officials. At 8.35 p.m. on the said date, the Inspector sent a Jeep to the CJM's residence and he went to the Station. According to the CJM when he arrived in the Station he was forced to consume liquor and on his refusal he was assulted, handcuffed and tied with rope by Inspector, Sub-Inspector, Head Constable, and Constable and that he was sent to under handcuffs. A photographer was arranged to take his photo- graph which was published in the newspapers. The Inspector disputed these allegations and according to him the CJM entered his chamber at the Station in a drunken state, shouting and abusing him and since he was violent, he was arrested, handcuffed and sent to . He himself wanted to be photo- graphed and that is why the photographs were taken by the press photographer. As the incident undermined the dignity of courts in the country, Judicial Officers, Judges and Magistrates all over the country were in a state of shock, they felt insecure and humiliated. A number of Bar Associations passed Resolutions and went on strike. , , and many others approached this by means of telegrams and petitions under Article 32 for saving the dignity and honour of the judiciary. The CJM also filed an application for quashing the two FIRs lodged against him and for directing the trial of his complaint as State case an award of compensation. On 29.9.1989 this took cogni- zance of the matter by issuing notices to the State of Gujarat and other Officers. Since there was serious dispute between the parties with regard to the entire incident, the appointed the senior puisne Judge of the Allahabad to inquire into the incident and to submit a report to the . The inquiry was held on behalf of the and not under the provisions of the of Inquiry Act . A detailed report was submitted to this and the directed copies to be delivered to the concerned parties and permit- ted the parties and the contemners to file their objections before this . 940 The Learned er's Report establised the follow- ing facts and circumstances: that the CJM found that the of Nadiad was not effective in service of summons and had adopted an attitude of indifference to the court's orders, and as complaints were forwarded to the authorities by the CJM there was confrontation between the local police and the magistracy. When the CJM visited the police station pursuant to the Inspector's request to discuss the matter, he was forced to consume liquor and on his refusal he was assaulted. He was tied up with a rope by the personnel and handcuffed deliberately in defiance of the state's Regulations and Circulars and the decision of this in panchnama showing the drunken state of the CJM was pre- pared by the Inspector and signed by two panchas--a and a Officer. A press photographer was brought on the scene, the police personnel posed with the CJM for the press photographer and the same was pub- lished in newspapers. A request made by the CJM to the doctors to contact and inform the District Judge about the incident was not allowed. On examination at the hospital, the body of the CJM was found to have a number of injuries. His blood was taken and chemical examination conducted. The Chemical Examiner submitted a report holding that the blood sample contained alcohol. At the initial stage only one case was registered against the CJM by the under the Bombay Prohibition Act, but when lawyers met the Inspector for securing release of the CJM on bail, the offence being bailable, the Inspector, registered another case under Sections 332 and 506 in order to frustrate the attempt. The District Superintendent of did not take immediate action in the matter but created an alibi that he had gone elsewhere and stayed in the government Rest House there, the register of the Rest House however indicating that the entry regarding the stay was manipulated subsequently by making an interpolation. On behalf of the contemners- Officers it was contended that: (1) this had no jurisdiction or power to indict the Officers even if they are found to be guilty, as their conduct does not amount to contempt of this . Articles 129 and 215 demarcate the respective areas of jurisdiction of and the respectively, and this 's jurisdiction under Article 129 is confined to the contempt of itself only, and it has no jurisdiction to indict a person for contempt of an infe- rior court subordinate to the. . (2) Even if is a court of record, it has no power to take action for the contempt of a Chief Judicial Magistrate's court as neither the constitution nor any statutory provi- sion confer any 941 such jurisdiction-or power on this . So far as the is concerned, it has power of judicial and administra- tive superintendence over the subordinate courts and Section 15 of the Contempts of s Act, 1971 expressly confers power on the to take action for the contempt of subordinate courts. (3) Under Entry 77 of List I of the Seventh Schedule, has legislative competence to make a law curtailing the jurisdiction of and Section 15 of the Contempts of s Act 1971 curtails the inherent power of this with regard to contempt of subordinate courts. Inherent powers are always preserved but they do not authorise a court to invest itself with juris- diction when that jurisdiction is not conferred by law. (4) Assumption of contempt jurisdiction with regard to contempt of subordinate and inferior courts on the interpretation of Article 129 of the Constitution is foreclosed by the deci- sions of the Federal in v. The Honable the Chief Justice and Judges of the o]' judicature at Lahore & Anr., AIR 1942 FC 1. This being the successor to the Federal was bound by the decisions of the Federal under Article 374(2) of the Constitution. (5) In our country there is no court of universal jurisdiction, as the jurisdiction of all courts including is limited. (6) Article 142(1) does not contemplate any order contrary to statutory provisions. (7) The findings recorded by the cannot be taken into account as those findings are hit by Article 20(3) of the Constitution. The Attorney-General urged that the power to punish contempt is a special jurisdiction which is inherent in a of record, that a superior court of record has inher- ent power to punish for contempt of itself and it necessari- ly includes and carries with it the power to punish for contempt committed in respect of subordinate or inferior courts, that a superior court of record having power to correct the order of an inferior court has power to protect that court by punishing those who interfere with the due administration of justice of that court. It was further urged that the Contempt of s Act 1971 recognises and preserves the existing contempt jurisdiction and power of the court of record for punishing for contempt of subordi- nate or inferior courts, that the Act has not affected or restricted the suo motu inherent power of being a court of record which has received constitutional sanction under Article 129 , that since this has taken cognizance of the contempt matter arising out of the inci- dent which is the subject matter of trial before the crimi- nal court, this has ample power under Article 142 of the Constitution to pass any order necessary to do justice and prevent abuse of process of the court and that there is no limitation on the power of this under Article 142 942 in quashing a criminal proceeding pending before a subordi- nate court. The basic questions that arose for consideration of the were: (a) whether has inherent jurisdiction or power to punish for contempt of subordinate or inferior courts under Article 129 of the Constitution, (b) whether the inherent jurisdiction and power of is restricted by the Contempt of s Act , 1971, (c) whether the incident interfered with the due administration of justice and constituted contempt of court, and (d) what punishment should be awarded to the contemners found guilty of contempt. Disposing of the writ petitions, Criminal Miscellaneous Petitions, and contempt petitions, this . HELD: 1.1 Contempt of court is an act or commission calculated to interfere with the due administration of justice. It includes civil and criminal contempt. [991D] in v. , 35 Ch.D. 436 at 455, referred to. 1.2 The definition of criminal contempt is wide enough to include any act by a person which would tend to interfere with the administration of justice or which would lower the authority of court. The public have a vital stake in effec- tive and orderly administration of justice. The has the duty of protecting the interest of the community in the due administration of justice and, so, it is entrusted with the power to commit for contempt of court, not to protect the dignity of the against insult or injury, but, to protect and vindicate the right of the public so that the administration of justice is not perverted, prejudiced, obstructed or interfered with v.U.S., 348 US 11, referred to. [991F] 1.3 The power to punish contempt is vested in the Judges not for their personal protecting only, but for the protec- tion of public justice, whose interest, requires that decen- cy and decorum is preserved in s of Justice. Those who have to discharge duty in a of Justice are protected by the law, and shielded in the discharge of their duties. Any deliberate interference with the discharge of such duties either in court or outside the court by attacking the presiding officers of the court, would amount to criminal contempt and the courts must take serious cognizance of such conduct. [993B] 943 The object and purpose of punishing contempt for interference with the administration of justice is not to safeguard or protect the dignity of the Judge or the Magis- trate, but the purpose is to preserve the authority of the courts to ensure an ordered life in society. [991H] Attorney-General v. Times Newspapers, (1974] A.C. 273 at p. 302, referred to. 1.5 The Chief Judicial Magistrate is head of the Magis- tracy in the District who administers justice to ensure, protect and safaguard the rights of citizens. The subordi- nate courts at the district level cater to the need of the masses in administering justice at the base level. By and large the majority of the people get their disputes adjudi- cated in subordinate courts. It is, in the general interest of the community that the authority of subordinate courts is protected. If the CJM is led into a trap by unscrupulous Officers, and if he is assaulted, handcuffed and roped, the public is bound to lose faith in s, which would be destructive of the basic structure of an ordered society. If this is permitted Rule of Law shall be supplant- ed by Raj. [992D-E] 1.6 The conduct of Officers in the instant case, in assaulting and humiliating the CJM brought the authority and administration of justice into disrespect, affecting the public confidence in the institution of justice. [992G] 1.7 The incident is a clear interference with the admin- istration of justice, lowering its judicial authority. Its effect was not confined to one District or State, it had a tendency to affect the entire judiciary in the country. The incident high-lights a dangerous trend that if the is annoyed with the orders of a presiding officer of a court, he would be arrested on flimsy manufactured charges, to humiliate him publicly as has been done in the instant case. [992F] 1.8 The facts of the instant case, demonstrate that a presiding officer of a court may be arrested and humiliated on flimsy and manufactured charges which could affect the administration of justice. In order to avoid any such situa- tion in future, it is necessary to lay down guidelines which should be followed in the case of arrest and detention of a Judicial Officer. [1000F] 1.9 In view of' the paramount necessity of preserving the independence of judiciary and at the same time ensuring that infractions of law are' properly investigated the following guidelines are to be 944 followed: (a) If a judicial officer is to be arrested for some offence, it should be done under intimation to the District Judge or the as the case may be. (b) If facts and circumstances necessitate the immediate arrest of a judicial officer of the subordinate judiciary, a technical or formal arrest may be effected. (c) The fact of such arrest should be immediately communicated.to the District and Sessions Judge of the concerned District and the Chief Justice of the . (d) The Judicial Officer so arrested shall not be taken to a police station, without the prior order or directions of the of the concerned District, if available. (e) Immediate facilities shall be provided to the Judicial Officer for communication with his family members, legal advisors and Judicial Officers, including the . (f) No statement of a Judicial Officer who is under arrest be recorded nor any panchnama be drawn up nor any medical test be conducted except in the presence of the Legal Advi- sor of the Judicial Officer concerned or another Judicial Officer of equal or higher rank, if available. (g) There should be no handcuffing of a Judicial Officer. If, however, violent resistance to arrest is offered or there is imminent need to effect physical arrest in order to avert danger to life and limb, the person resisting arrest may be over- powered and handcuffed. In such case, immediate report shall be made to the concerned and also to the Chief Justice of the . But the burden would be on the to establish the necessity for effecting physical arrest and handcuffing the Judicial Officer and if it be established that the physical arrest and hand-cuffing of the Judicial Officer was unjustified, the Officers causing or responsible for such arrest and handcuffing would be guilty of misconduct and would also be personally liable for compensation and/or damages as may be summarily deter- mined by the . [1000G-1001F] 1.10 These guidelines are not exhaustive but are the minimum safeguards to be observed in case of arrest of a Judicial Officer. These should be implemented by the State Governments as well as by the . [1001G] 1. 11 No judicial officer should visit a Sta- tion on his own except in connection with his official and judicial duties and functions, and this also with prior intimation to the District and Sessions Judge. [1002B] 2.1 The as the Apex is the protec- tor and guardian of justice throughout the land, therefore, it has a right and also a duty to protect the courts whose orders and judgments are amenable to correction, from com- mission of contempt against them. This 945 right and duty of the Apex is not abrogated merely because the also has this right and duty of protection of the subordinate courts. The jurisdictions are concurrent and not exclusive or antagonistic. [967G-H] 2.2 Article 136 vests with wide powers to grant special leave to appeal from any judgment, decree determination sentence or order in any cause or matter passed or made by any court or tribunal in the territory of India except a court or tribunal constituted by or under any law relating to . The 's appellate power under Article 136 is plenary, it may entertain any appeal by granting special leave against any order made by any Magistrate, or any other subordinate court. The width and amplitude of the power is not affected by the practice and prcedure followed in insisting that before invoking the jurisdiction under Article 136 the aggrieved party must exhaust remedy available under the law before the appellate authority of the . Self imposed restric- tions do not divest it of its wide powers to entertain any appeal against any order or judgment passed by any court or tribunal in the country without exhausting alternative remedy before the appellate authority or the . The power of the under Article 136 is unaffected by Arti- cles 132. 133 and 134(A) in view of the expression \"notwith- standing anything in this Chapter\" occurring in Article 136. [968E- ., 1 SCR 267 and ., 2 SCC 297, referred to. 2.3 In addition to the appellate power, has special residuary power to entertain appeal against any order of any court in the country. The plenary jurisdiction of the to grant leave and hear appeals against any order of a court or , confers power of judicial superintendence over all the courts and in the territory of India including subordinate courts of Magistrate and District Judge. The has, therefore, supervisory jurisdiction over all courts in India. [970F] 2.4 Article 129 provides that shall be a court of record and shall have all the powers of such a court including the power to punish for contempt of itself. Article 215 contains similar provision in respect of . Both as well as are courts of record having powers to punish for contempt in- cluding the power to punish for contempt of itself..[970G] 946 2.5 The Constitution does not define \" Of Record\". A \" of Record\" is a court where acts and judicial proceedings are enrolled in parchment for a perpetual memo- rial and testimony, which rolls are called the 'record' of the court and.are conclusive evidence of that which is recorded therein. [970H -971 E] ' Wharton's Law Lexicon: Words & Phrases (Permanent Edi- tion) vol. 10 p. 429: Halsbury's Laws of England Vol. 10 p. 319. 2.6 In India prior to the enactment of the Contempt of s Act , 1926, 's jurisdiction in respect of contempt of subordinate and inferior courts was regulated by the principles of Common Law of England. The in the absence of statutory provision exercised power of con- tempt to protect the subordinate courts on the premise of inherent power of a of Record. [974F-G] v. , 97 ER 94; v. The Justices of , 8 Moors PC 47 at 54; v. The Chief Justice and Judges of the at Fort William in Bengal, ILR to Calcutta 109; v. , 2 K.B. 432 at 442; v. , 1 K.B. 32; v. Editor of , 2 K.B. 733; Attorney General v. , 3 ALR 161; 21 Madras Law Journal 832; 22 368; AIR 1926 Allahabad 623; , AIR 1930 Allahabad 225 FB; Mr. v. , AIR 1935 Nagpur 46; v. Emperor, AIR 1937 Lahore 497; v. , AIR 1939 Oudh, 131 and Legal Remembrancer v. , ILR 41 Cal. 173, referred to. 2.7 The s Bench in England and in India being superior of Record and having judicial power to correct orders of subordinate courts enjoyed the inherent power of Contempt to protect the subordinate courts. The being a of Record under Article 129 and having wide power of judicial supervision over all the courts in the country, must possess and exercise similar jurisdiction and power as the had prior to Contempt Legislation in 1926. Inherent powers of a superior of Record have remained unaffected even after Codifi- cation of Contempt Law. [976G- , SCR 454 and R.L. Kapur v. State of Tamil Nadu, AIR 1972 SC 858, referred to. 947 2.8 The Contempt of s Act 1971 was enacted to define and limit the powers of s in punishing contempts of courts and to regulate their procedure in relation there- to. There is no provision therein curtailing 's power with regard to contempt of subordinate courts, Section 15 expressly refers to this 's power for taking action for contempt of subordinate courts. The section prescribes modes for taking cognizance of criminal contempt by the and . It is not a substantive provision conferring power or jurisdiction on the or on for taking action for the contempt of its subordinate courts. The whole object of prescribing procedural modes of taking cognizance in Section 15 is to safeguard to valuable time of the and being wasted by frivolous complaints of contempt of court. Section 15(2) does not restrict the power of the to the cognizance of the contempt of itself or of a subordinate court on its own motion although apparently the Section does not say so. [977A-C, 978G- , 2 SCR 331, referred to. 3.1 Under Entry 77 of List I of the Seventh Schedule read with Article 246 , is competent to enact a law relating to the powers of with regard to 'contempt of itself'. Such a law may prescribe procedure to be followed and it may also prescribe the maximum punish- ment which could be awarded and it may provide for appeal and for other matters. But has no legislative competence to abridge or extinguish the juris- diction or power conferred on under Arti- cle 129. The 's power to legislate in relation to the law of contempt relating to is limit- ed, therefore the Contempt of s Act does not impinge upon 's power with regard to the contempt of subordinate courts under Article 129. [979C-F] 3.2 Article 129 declares a court of record and it further provides that shall have all the powers of such a court including the power to punish for contempt of itself The expression used in Article 129 is not restrictive, instead it is extensive in nature. If the Framers of the Constitution intended that shall have power to punish for contempt of itself only, there was no necessity for inserting the expression \"including the power to punish for contempt of itself.\" [979G] 3.3 Article 129 confers power on to punish for 948 contempt of itself and in addition, it confers some addi- tional power relating to contempt as would appear from the expression \"including\". The expression \"including\" has been interpreted by courts, to extend and widen the scope of power. The plain language of the Article clearly indicates that as a of record has power to punish for contempt of itself and also something else which could fall within the inherent jurisdiction of a court of record. [979H-980A] 3.4 In interpreting the Constitution, it is not permis- sible to adopt a construction which would render any expres- sion superfluous or redundant. [980B] 3.5 While construing Article 129 , it is not permissible to ignore the significance and impact of the inclusive power conferred on . [980B] 3.6 The conferment of appellate power on the by a statute section 19 of the Contempt of s Act 1971 does not and cannot affect the width and amplitude of inherent powers of this under Article 129 of the Constitution. [981E] v. The Honable the Chief Justice and Judges of the of Judicature at Lahore & Anr AIR 1942 FC 1, distinguished. 4.1 Article 374(2) is in the nature of a transitory provision to meet the exigency of the situation on the abolition of the Federal and setting up of . There is no provision in the said Article to the effect that the decisions of the Federal shall be binding on . The decisions of the Federal and the made before the commencement of the Constitution are entitled to great respect but these decisions are not binding on and it is always open to this to take a different view. [983F- , AIR 1951 Allahabad 205 and , AIR 1954 Bombay 352, approved. , SCR 786 and ., 1 SCR 1, referred to. 949 v. The Hon'ble the Chief Justice and Judges or the of Judicature at Lahore & Anr., AIR 1942 FC 1 and v. The Emperor, FCR 364, explained and distinguished. The Federal exercised limited jurisdiction as conferred on it by the Government of India Act 1935. The question regarding the inherent power of as a of Record in respect of the contempt of subordi- nate s was neither raised nor discussed in its deci- sions. The Federal observed that if the and the Federal both have concurrent jurisdiction in contempt matters, it could lead to conflicting judgments and anamolous consequences. That may be so under the Government of India Act as the and the Federal did not have concurrent jurisdiction, but under the Constitution, and both have concurrent juris- diction in several matters, yet no anamolous consequences follow. [985H-986B] 4.2 The Federal did not possess the wide powers as has under the Constitution. There are marked difference in the constitution and jurisdiction and the amplitude of powers exercised by the two courts. In addition to civil and criminal appellate jurisdiction, has wide powers under Article 136 over all the courts and in the country. The Federal had no such power, instead it had appellate power but that too could be exercised only on a certificate issued by the . The Federal was a court of record under Section 203 but it did not possess any plenary or residuary appel- late power over all the courts functioning in the territory of India like the power conferred on under Article 136 of the Constitution. Therefore, the Federal had no judicial control or superintendence over subor- dinate courts. [986C-E] 4.3 Advent of freedom, and promulgation of the Constitu- tion have made drastic changes in the administration of justice necessitating new judicial approach. The Constitu- tion has assigned a new role to the Constitutional s to ensure rule of law in the country. These changes have brought new perceptions. In interpreting the Constitution, regard must be had to the social, economic and political changes, need of the community and the independence of the judiciary. The cannot be a helpless spectator, bound by precedents of colonial days which have lost relevance. Time has come to have a fresh look to tile old precedents and to lay down law with the changed perceptions keeping in view the provisions of the Constitution. [986F-G] 950 5.1 s constituted under a law enacted by or have limited jurisdiction and they cannot assume jurisdiction in a matter, not ex- pressly assigned to them, but that is not so, in the case of a superior court of record constituted by the Constitution such a court does not have a limited jurisdiction, instead it has power to determine its own jurisdiction. No matter is beyond the jurisdiction of a superior court of record unless it is expressly shown to be so, under the provisions of the Constitution. In the absence of any express provision in the Constitution, the Apex being a of record has jurisdiction in every matter and if there be any doubt, the has power to determine its jurisdiction. If such determination is made by the , the same would be subject to appeal to this , but if the jurisdiction is determined by this it would be final. [988C-E] Naresh Shridhar Mirajkar & Ors. v. State of Maharashtra JUDGMENT: ", "[1965] 1 SCR 413 and , 1 SCC 75, referred to. ", "5.2 Since has power of judicial super- intendence and control over all the courts and functioning in the entire territory of the country, it has a corresponding duty to protect and safeguard the interest of inferior courts to ensure the flow of the stream of justice in the courts without any interference or attack from any quarter. The subordinate and inferior courts do not have adequate power under the law to protect themselves, there- fore, it is necessary that this Court should protect them. Under the constitutional scheme it has a special role in the administration of justice and the powers conferred on it under Article 32 , 136 , 141 and 142 form part of the basic structure of the Constitution. The amplitude of the power of the court under these Articles of the Constitution cannot be curtailed by law made by . [987A-C] 5.3 and both exercise concurrent jurisdiction under the constitutional scheme in matters relating to fundamental rights under Articles 32 and 226 of the Constitution. Therefore, this Court's jurisdic- tion and power to take action for contempt of subordinate courts would not be inconsistent to any constitutional scheme. [987D] 5.4 is duty bound to take effective steps within the constitutional provisions to ensure a free and fair administration of justice through out the country. For that purpose it must wield the requisite power to take action for contempt of subordinate courts. Ordinarily, would protect the subor- dinate courts from any onslaught on their independence, but in exceptional cases, extraordinary situation may prevail affecting the administration of public justice or where the entire judiciary is affected, this Court may directly take cognizance of contempt of subordinate courts. [987F] 5.5 will sparingly exercise its inher- ent power in taking cognizance of the contempt of subordi- nate courts, as ordinarily matters relating to contempt of subordinate courts must be dealt with by s. The instant case is of exceptional nature as the incident created a situation where functioning of the subordinate courts all over the country was adversely affected and the administration of justice was paralysed, therefore, this Court took cognizance of the matter. [987G-988A] 6.1 Though there is no provision like section 482 of the Criminal Procedure Code conferring express power on to quash or set aside any criminal proceeding pending before a criminal court to prevent abuse of process of the court, but the Court has power to quash any such proceeding in exercise of its plenary and residuary powers under Article 136 of the Constitution, if on the admitted facts no change is made out against the accused or if the proceedings are initiated on concocted facts, or if the proceedings are initiated for oblique purposes. [996E] Once is satisfied that the criminal proceedings amount to abuse of process of court it would quash such proceedings to ensure justice. [996G] ., 3 SCR 121 and ., 1 SCC 692, referred to. ", "6.2 The inherent power of under Arti- cle 142 coupled with the plenary and residuary powers under Articles 32 and 136 embraces power to quash criminal pro- ceedings pending before any court to do complete justice in the matter before this . If the court is satisfied that the proceedings in a criminal case are being utilised for oblique purposes or if the same are continued on manufac- tured and false evidence or if no case is made out on the admitted facts, it would be in the ends of justice to set aside or quash the criminal proceeding. It is idle to sug- gest that in such a situation this should be a help- less spectator. [997B-C] 6.3 The 's power under Article 142(1) to do \"complete justice\" is entirely of different level and of a different quality. Any prohibition or restriction contained in ordinary laws cannot act as a limitation on the constitu- tional power of this . Once this has seisin of a cause or matter before it has power to issue any order or direction to do \"complete justice\" in the matter. This constitutional power of the Apex cannot be limited or restricted by provisions contained in statutory law. [997G] 6.4 What would be the need of \"complete justice\" in a cause or matter would depend upon the facts and circum- stances of each case and while exercising that power the would take into consideration the express provisions of a substantive statute. Once this has taken seisin of a case, cause or matter, it has power to pass any order or issue direction as may be necessary to do complete jus- tice in the matter. [998D] , Supp. 1 SCR 885 and ., [ 1988] 2 SCC 602, referred to. ", "In the instant case, the foundation of the criminal trial of CJM-NL is based on facts which have been found to be false. It would be in the ends of justice and also to do complete justice in the cause to quash the crimi- nal proceedings. [998F] 7.1 Article 20(3) of the Constitution declares that no person accused of any offence shall be compelled to be a witness against himself. In order to avail the protection of Article 20(3) three conditions must be satisfied. Firstly, the person must be accused of an offence. Secondly, the element of compulsion to be a witness should be there, and thirdly it must be against himself. All the three ingredi- ents must necessarily exist before protection of Article 20(3) is available. If any of these ingredients do not exist, Article 20(3) cannot be invoked. [964E- , 4 SCC 600, referred to. ", "7.2 Mere issue of notice or pendency of contempt proceedings do not attract Article 20(3) of the Constitution as the contemners against whom notices were issued were not accused of any offence. A Criminal contempt is punishable by the superior courts by fine or imprisonment, but it has many characteristics which distinguishes it from an ordinary offence. [964G] 7.3 The power to take proceedings for contempt of is an inherent power of a of record. The Criminal Procedure Code does not apply to such proceedings. Since the contempt proceedings are not in the nature of criminal proceedings for an offence, the pendency of contempt pro- ceedings cannot be regarded as criminal proceedings merely because it may end in imposing punishment on the contemner. A contemner it is not in the position of an accused. It is open to the to cross-examine the contemner and even if the contemner is found to be guilty of contempt, the may accept apology and discharge the notice of contempt, whereas tendering of apology is no defence to the trial of a criminal offence. This peculiar feature distinguishes con- tempt proceedings from criminal proceedings. In a criminal trial where a person is accused of an offence there is a public prosecutor who prosecutes the case on behalf of the prosecution against the accused but in contempt proceedings the court is both the accused as well as the judge of the accusation. [966C-E] case, AIR 1969 SC 189, referred to. ", "7.4 In the instant case, the contemners do no stand in the position of a \"person accused of an offence\" merely on account of issue of notice of contempt by this Court and the which was acting on behalf of this Court had full authority to record the testimony of the contemners. There has, therefore, been no violation of Article 20(3) of the Constitution and the 's finding are not violated. [966F-G] 8.1 In determining, what punishment should be awarded to contemners found guilty, the degree and the extent of part played by each of the contemners has to be kept in mind. [998G] 8.2 In the instant case, , the Police Inspector was the main actor in the entire incident and who had planned the entire episode with a view to humiliate the CJM in the public eye is the main culprit and therefore, he deserves maximum punishment. The Sub Inspector took an active part in assaulting and tying the CJM at the behest of the Police Inspector. The Head Constable and Constable also took active part in handcuffing and tying the CJM with ropes, but as subordinate officials they acted under the orders of the superior officers. The was a friend of the Police Inspector, he had no axe to grind against the CJM but he acted under the influence of the Police Inspec- tor. So far as the DSP is concerned, he actively abetted the commission of onslaught on the CJM. The contemners are held guilty of contempt and awarded punishment. [998H-999B] 8.3 The Police Inspector to undergo simple imprisonment for a period of six months and to pay fine of Rs.2,000. The Sub-Inspector to undergo simple imprisonment for a period of five months and pay a fine of Rs.2,000 and in default one month's simple imprisonment. Head Constable and Constable, each to undergo simple imprisonment for two months and a fine of Rs.500 and in default 15 days simple imprisonment. The to undergo simple imprisonment for a period of two months and a fine of Rs.1,O00 and in default one month's simple imprisonment. The DSP is sentenced to imprisonment for a period of one month and a fine of Rs.1,O00 and in default simple imprisonment for 15 days. So far as the other respondents against whom notices were issued no adequate material on record holds them guilty. The contempt notices are therefore discharged. [999C-E] 9.1 The Court expressed displeasure on the conduct of the DGP. As the head of the Police in the State, he was expected to intervene in the matter and to ensure effective action against the erring Police Officers. He was totally indifferent to the news that a CJM was arrested, handcuffed, roped, and assaulted. He took this news as a routine matter without taking any steps to ascertain the correct facts for effective action against the erring Police Officers. If the head of exhibits such indif- ference to a sensitive matter which shook the entire judi- cial machinery in the State, nothing better could be expect- ed from his subordinate officers. The State Government should take action departmentally on the basis of the find- ings recorded by the . [999F-1000A] 9.2 The discharge of the contempt notices does not absolve the officers of their misconduct. The State Govern- ment is directed to proceed with the disciplinary proceed- ings for taking appropriate action. [1000B] & ORIGINAL JURISDICTION: Writ Petition (CRL.) No. 517 of 1989 etc. etc. (Under Article 32 of the Constitution of India). , Attorney General, , Addl. Solicitor General, , , , Dr. , , , , , , , T.C. , , , , , , , , , Ms. , . , , , , , , , , , , Mrs. , and . T.C. for the appearing parties. The Judgment of the Court was delivered by J. On 25th September, 1989, a horrendus incident took place in the town of Nadiad, District Kheda in the State of Gujarat, which exhibited the berserk behaviour of Police undermining the dignity and independence of judi- ciary. S.R. , Inspector of Police, with 25 years of service posted at the Police Station, Nadiad, arrested, assaulted and handcuffed , Chief Judicial Magis- trate, Nadiad and tied him with a thick rope like an animal and made a public exhibition of it by sending him in the same condition to the Hospital for medical examination on an alleged charge of having consumed liquor in breach of the prohibition law enforced in the State of Gujarat. The In- spector S.R. got the Chief Judicial Magistrate photo- graphed in handcuffs with rope tied around his body along- with the constables which were published in the news papers all over the country. This led to tremors in the Bench and the throughout the whole country. ", "The incident undermined the dignity of courts in the country, Judicial Officers, Judges and Magistrates all over the country were in a state of shock, they felt insecure and humiliated and it appeared that instead of Rule of Law there was Police Raj in Gujarat. A number of Associations passed Resolutions and went on strike. , , , and many others approached by means of telegrams and petitions under Article 32 of the Constitution of India for Saving the dignity and honour of the judiciary. On 29.9.1989, this Court took cognizance of the matter by issuing notices to the State of Gujarat and other Police Officers. The Court appealed to the Members of the and to resume work to avoid inconvenience to the litigant public. Subsequently, a number of petitions were filed under Article 32 of the Constitution of India for taking action against the Police Officers and also for quashing the criminal proceedings initiated by the Police against , Chief Judicial Magistrate. A number of Associations, Councils and individuals appeared as interveners condemning the action of the police and urging the Court for taking action against the Police Officers. ", "956 ", "In Petition No. 5 18 of 1989 alongwith Contempt Petition No. 6 of 1989 filed by the President, , notices for contempt were issued by this Court on 4.10.1989 to seven Police Officials, , D.S.P., , Dy. S.P., , Police Inspector, , Police Inspector (Crime), , Sub-Inspector of Police, , Head Constable and , Constable. , CJM, Nadiad also filed an application in W.P. No. 517 of 1989 with a prayer to quash the two FIRs lodged against him, to direct the trial of the complaint filed by him as case and to award compensation. ", "On 13.2.1990 notices from contempt were issued to. , Ex. D.G.P., Gujarat, Dr. , Senior Medical Officer of Nadiad and , Mamlatdar, Nadiad. The during the proceedings also issued notices to , Additional Chief Secretary (), and , District Judge, Nadiad to show cause why action be not taken against them in view of the Report of Justice . ", " was posted as Chief Judicial Magistrate at Nadiad in October, 1988. He soon found that the local was not cooperating with the courts in effecting service of summons, warrants an notices on accused persons, as a result of which the trials of cases were delayed. He made complaint against the local to the District Superintendent of and forwarded a copy of the same to the Director General of but nothing concrete happened. On account of these complaints , Inspector Nadiad was annoyed with the Chief Judicial Magistrate, he withdrew constables posted in . In April, 1989 filed two complaints with the against and other Officials, Nadiad for delaying the process of the court. On 25 July, 1989 directed the to register a criminal case against 14 persons who had caused obstruction in judicial proceedings but subsequently since they tendered unqualified apology, the CJM directed the Inspector to drop the cases against-those persons. reacted strongly to 's direction and he made complaint against the CJM to the Registrar of through District Superintendent of . These facts show that there was hostility between the of Nadiad and the CJM. On 25.9. 1989, met , CJM in his Chambers to discuss the case of one Jitu Sport where the had failed to submit charge-sheet within 90 days. During discussion invited the CJM to visit the Station to see the papers and further his visit would mollify the sentiments of the Officials. It is al- leged that at 8.35 p.m. sent a Jeep at 's residence, and on that vehicle went to the Station. What actual happened at the Station is a matter of serious dispute between the parties. According to the CJM, he ar- rived in the Chamber of in the Station, he was forced to consume liquor and on his refusal he was assault- ed, handcuffed and tied with rope by , Inspec- tor, -Inspector, , Head Consta- ble and , Constable. It is further alleged that was sent to Hospital for Medical examination under handcuffs where he was made to sit on a bench in the varanda exposing him to the public gaze. , Inspector and other Officers have disputed these allegations. According to , entered his chamber at the Station at 8.45 p.m. on 25.9. 1989 in a drunken state, shouting and abusing him, he caught hold of and slapped him, since he was violent he was arrested, hand- cuffed and sent to Hospital for medical examination. himself wanted to be photographed while he was handcuffed and tied with ropes, a photographer was arranged to take his photograph which was published in the newspapers. Since, there was serious dispute between the parties with regard to the entire incident, the Court appointed Justice senior puisne Judge of (as he then was) to inquire into the incident and to submit report to the Court. Justice was appointed to hold the inquiry on behalf of this Court and not under the provisions of the Commission of Inquiry Act . Justice visited Nadiad and held sittings there. The learned Commis- sioner/Judge invited affidavits/statements, and examined witnesses including the Inspector, , D.S.P. and other Officers, lawyers, , CJM, and Doctors and other witnesses. Justice afforded full opportunity to all the concerned persons including the State Government, Officers and lawyers to lead evidence and to cross examine witnesses. He submit- ted a detailed Report dated 28.11.1989 to this Court on 1.12.1989. On receipt of the Report this Court directed copies to be delivered to concerned parties and permitted the parties and the contemners to file their objections, if any, before this Court. The objections were filed by the Officers and the contemners disputing the findings recorded by the Commissioner, On 12.12.1989, when the matter came up for final dispos- al the Court issued notices to the Attorney-General and Advocate-General of the State of Gujarat. On 10.1.1990 the Court directed the State of Gujarat to file affidavit stat- ing as to what action it had taken or pro- ", "958 ", "posed to take against the officers in the light of the Report of Justice . The Court further issued notices to , Additional Chief Secretary (Home), Govern- ment of Gujarat, , Director General of Police, , District Judge, to show cause as to why action should not be taken against them in view of the Report of Justice . The State Government was further directed to explain as to why action against , DSP, , Police Inspector and other police officers had not been taken. On 13.2. 1990 a notice for contempt of this Court was issued to on the same date in view of the findings recorded by Justice , notices for contempt of court were issued to Dr. and , , also. ", "in his affidavit, , Inspector has raised a number of objections to the findings recorded by the Commissioner. The objections are technical in nature, chal- lenging the authority and jurisdiction of the Commissioner in collecting evidence and recording findings against him. has further stated in his objections that the Commis- sioner acted as if he was sitting in judgment over the case. Other Officers have also raised similar objections. We find no merit in the objections raised on behalf of , Inspector and other contemners. The Commis- sioner had been appointed by this to hold inquiry and submit his report to the . Justice was acting on behalf of this and he had full authority to record evidence and cross-examine witnesses and to collect evidence on behalf of this . Since, the main incident of Chief Judicial Magistrate's arrest, assault, handcuffing and roping was connected with several other incidents which led to the confrontation between the Magistracy and local po- lice, the learned Commissioner was justified in recording his findings on the background and genesis of the entire episode. The Inspector raised a grievance that he was denied opportunity of cross-examination of , CJM and he was not permitted to produce Dr. as a witness, 's application for the recall of CJM for further cross-examination and for permission to produce Dr. , retired Deputy Director, , Guja- rat, was rejected by a well reasoned order of the Commis- sioner dated 9.11.1989. We have gone through the order and we find that the Commissioner has given good reasons for rejecting the recall of CJM for further cross-examination, as he had been crossexamined by the counsel appearing on behalf of the officials including . The Officers and the State Government and CJM were represented by counsel before the Commissioner and every opportunity was afforded to them for cross-examining the witnesses. ", "959 ", "Dr. 's evidence was not necessary, the Commissioner rightly refused 's prayer. ", "On behalf of the contemners it was urged that in the absence of any independent testimony the was not justified in accepting interested version of the incident as given by the CJM with regard to his visit to the Police Station and the incident which took place inside the Police Station. There was oath against oath and in the absence of any independent testimony the was not justified in accepting the sole interested testimony of , CJM. We find no merit in this objection. The learned er has considered the evidence as well as the circumstances in support of his findings that had been invited by to visit the Police Station and he had sent a Police jeep on which went to the Police Station. This fact is supported by independent witnesses as discussed by the er. If had gone on the invitation of on Police jeep and not in the manner as alleged by , could not be drunk and there appears no reason as to why he would have assaulted as alleged by the Police. The circumstances as pointed out by the er fully justify the findings recorded against the Police Officers. It is settled law that even in a criminal trial, accused is convicted on circumstantial evidence in the absence of an eye witness, Learned er acted judicially in a fair and objective manner in holding the inquiry, he afforded opportunity to the affected Police Officers and other per- sons and submitted his Report based on good reasons in respect of his findings which are amply supported by the material on record. The er did a commendable job in a record time. After hearing arguments at length and on perusal of the statements recorded by the er and the documentary evidence submitted by the parties, and a careful scrutiny of the affidavits and objections filed in this , we find no valid ground to reject the well- reasoned findings recorded by the learned er. The er's Report runs into 140 pages, which is on record. The contemners and other respondents have failed to place any convincing material before the to take a different view. We accordingly accept the same. After hearing learned counsel for the parties and on perusal of the affidavits, objections, applications and the Report of the er, we hold that the following facts and circumstances are fully proved: ", "(1) , Chief Judicial Magistrate found that the of Nadiad was not effective in service of summons and it had adopted an attitude of indifference to court orders. He tried to obtain the assistance of the District Superintend- ent of in February, 1989 and addressed a letter to the Director General' of but no response came from the Authorities, even though the Government had reminded , D.S.P., Kheda to do the needful. , the CJM filed two complaints against Officers of Nadiad Station and the Inspectors, and forwarded it to the District Superintendent of on 19th and 24th July, 1989 for taking action against them. , the Inspector who had by then been posted at Nadiad reacted to the CJM's conduct by withdrawing constables working in the courts of Magistrates on the alleged pretext of utilising their services for service of summons. This led to confrontation between the local and the Magistracy commenced. ", "(2) On 25th July, 1989, the CJM had directed the regis- tration of a case against 14 accused persons for misbeha- viour and causing obstruction in the judicial proceedings. Since the accused persons had later expressed regret and tendered unqualified apology to the court, the CJM sent a letter to the Police Inspector, to drop proceedings. went out of his way, to send a complaint to through the saying that was functioning in an illegal manner in the judicial discharge of his du- ties. The action of , Police Inspector was highly irresponsible and , should not have acted in a casual manner in forwarding 's letter to the Registrar of directly. ", "(3) Remand period of Jitu Sport was to expire on 27th September, 1989, the CJM directed the Inspector to produce complete papers before the expiry of the period of remand but he applied for the extension of the judicial remand. The CJM directed the Inspector to produce papers on 22.9.1989, did not appear before the CJM as directed, on the contrary he interpolated the order, sent to him indicating that he was required to appear before the CJM on 23.9.1989, which was admittedly a holiday. (4) On 25th September, 1989, met the CJM in his Chamber and as a pretext requested him to come to the Station to see the papers which could not be brought to the Court, as that could satisfy him that the was doing the needful for complying with the orders of the Court. pleaded with CJM that his visit to Station will remove the feeling of confrontation between the and Magistracy. The CJM agreed to visit the Station and offered to send police jeep to CJM's house for bring- ing him to the Station. ", "(5) On 25.9.89 after the Court hours the CJM went to the officers' club where he remained in the company of , District Judge and , Civil Judge till 8,30 p.m. Thereafter, he went to his residence. A jeep came to his residence at about 8.40 p.m. in the Officers Colony, he went on that jeep to the Station situated at a distance of about 2 kms. had not consumed liquor before he went to the Station. ", "(6) The Police version that had consumed liquor before coming to the Police Station and that he assaulted the Police Inspector and misbehaved with him at the Police Station is a cooked up story. did not go to the Police Station on foot as alleged by , instead, he went to the Police Station in a Police jeep on 's invitation. was handcuffed and tied with rope, and he received injuries at the Police Station, he was assaulted and forced to consume liquor after he was tied to the chair on which he was sitting, Police Inspector , Sub-In- spector , Head Constable and Consta- ble took active part in this episode. They actively participated in the assualt on and in forcing liquor in his mouth. They acted in collusion with to humiliate and teach a lesson to . ", "(7) On the direction of , Police Inspector, was handcuffed at the Police Station and he was further tied up with a thick rope by the Police Inspector, , , Sub-Inspector, , Head Constable and , Constable. This was deliberately done in defiance of Police Regulations and Circulars issued by the Gujarat Government and the law declared by this Court in ., 3 SCC 526. had not committed any offence nor he was violent and yet he was handcuffed and tied up with rope without there being any justification for the same. There were seven police personnel present at the Police Station and most of them were fully armed while was empty handed, there was absolutely no chance of escaping from the custody or making any attempt to commit suicide or attacking the Police Officers and yet he was handcuffed and tied up with a thick rope like an animal with a view to humiliate and teach him a lesson. For this wanton act there was absolutely no justification and pleas raised by that was violent or that he would have escaped from the custody are figment of imagination made for the purpose of the case. ", "962 ", "(8) The panchnama showing the drunken state of prepared on the dictation of , Police Inspector, and signed by as well as by two panches, , and , Officer, , did not represent the correct facts, instead, it was manufac- tured for the purpose of preparing a false case against CJM , justifying his arrest and detention. (9) On examination at 's body was found to have a number of injuries. The injury on the left eye was very clear which appeared to have been caused by external force. His body had bruises and abrasions which could be caused by fists and blows. While in the casualty ward of , requested the Doctors to contact the District Judge and inform him about the inci- dent. Dr. tried' to ring up the District Judge but he was prevented from doing so by and other Police Officers who were present there. Dr. and Dr. found the speech of normal, gait steady, he was neither violent, nor he misbehaved. His blood was taken for chemical examination but the Forms used were not according to the rules and the blood was not taken in accordance with procedure prescribed by the Rules and the Circulars issued by the Director of Medical Services, Gujarat. The chemical examination of the blood sample taken in was not correctly done. The blood sample was analysed by a teenager who was not a testing officer within the Bombay Prohibition Act and necessary precautions at the time of analysis were not taken. The phial in which the blood sample had been sent to the Chemical Examiner did not contain the seal on phial and the seal was not fully legible. The Chemi- cal Examiner who submitted the report holding that the blood sample of contained alcohol on the basis of the calcu- lation made by him in the report clearly admitted before the that he had never determined the quantity of liquor by making calculation in any other case and 's case was his first case. ", "(10) When was taken to Civil Hospital handcuffed and tied with thick rope he was deliberately made to sit outside in the Varanda on bench for half an hour in public gaze, to enable the public to have a full view of the CJM in that condition. A Press photographer was brought on the scene and the men posed with for the press photograph. The photographs were taken by the Press Reporter without any objection by the , although a belated justification was pleaded by the that desired to have himself photographed in that condition. This plea is totally false. The photographs taken by the Press Reporter were published in `Jan Satta' and 'Lokmat' on 26th September. 1989 showing handcuffing and tied with rope and the men standing beside him. This was deliberately arranged by to show to the public that weilded real power and if the CJM took confrontation with he will not be spared. ", "(11) At the initial stage, one case was registered against by the under the Bombay Prohibition Act. Two Advocates and met at 11.30 p.m. for securing 's release on bail, as offences under the Prohibition Act were bailable. The lawyers re- quested to allow them to meet the CJM who was in the police lock-up but did not allow them to do so. With a view to frustrate lawyers' attempt to get released on bail. registered another case against under Sections 332 and 506 of Indian Penal Code as offence under Section 332 is non-bailable. ", "(12) , the then District Superintendent of Police, Kheda exhibited total indifference to CJM's com- plaint regarding the unsatisfactory state of affairs in the matter of execution of court processes. identified himself with , Police Inspector who appeared to be his favourite. Instead of taking corrective measures in the service of processes, he became party along with in forwarding his complaint to against 's order in a judicial matter. The incident which took place in the night of 25/26 September 1989, had the blessing of . He did not take any immediate action in the matter instead he created an alibi for himself alleging that he had gone to Lasundara and then to Balasinor Police Station and stayed there in a Government Rest House. The register at the Rest House indicating the entry regarding his stay was manipulated subsequently by making interpolation. On the direction of Additional Chief Secretary () sub- mitted his report on 27.9. 1989 but in that report he did not make any reference of handcuffing and roping of the CJM although it was a matter of common knowledge and there was a great resentment among the judicial officers and the local public. 's complicity in the sordid episode is further fortified by the fact that he permitted , the main culprit of the entire episode to carry on investigation against in the case registered against him by and also in the case registered by against . (13) Police Inspector had pre-planned the entire incident and he had even arranged witnesses in advance for preparing false case against N.L. , CJM, as M.B. Sa- vant, in the Police Station, immediately on the arrival of , CJM, and they acted in complicity with in preparing the panchnama which falsely stated that was drunk. and both were hand in glove with to flasely implicate in Prohibition Case. Learned Commissioner has adversely commented upon the conduct of various officers including , the then Director General of Police, Gujarat, , CID Inspector, Dr. , Senior Medical Officer, , , , , Officer and A.N. , Chemical. Examiner, . After considering the material on record, we agree with the view taken by the Commissioner that ,their conduct was not above board as expected from responsible officers. We do not consider it necessary to burden the judgment by referring to the details of the findings as the same are contained in the Commis- sioner's Report. ", "Mr. contended on behalf of the Po1ice Officers that the findings recorded by the cannot be taken into account as those findings are hit by Article 20(3) of the Constitution. Inspector and other Police Officers against whom criminal cases have been registered were com- pelled to be witnesses against themselves by filing affida- vits and by subjecting them to cross examination before the er. Any finding recorded on the basis of their evidence is violative of Article 20(3) of the Constitution. Article 20(3) of the Constitution declares that no person accused of any offence shall be compelled to be a witness against himself. In order to avail the protection of Article 20(3) three conditions must be satisfied. Firstly, the person must be accused of an offence. Secondly, the element of compulsion to be a witness should be there and thirdly it must be against himself. All the three ingredients must necessarily exist before protection of Article 20(3.) is available. If any of these ingredients do not exist, Article 20(3) cannot be invoked see: ., 4 SCC 600. In the instant case this had issued notices for contempt to , Police Inspector and other contemners. Mere issue of notice or pendency of contempt proceedings do not attract Art. 20(3) of the Constitution as the contemners against whom notices were issued were not accused of any offence. A criminal contempt is punishable by the superior courts by fine or imprisonment, but it has many characteristics which distin- guishes it from ordinary offence. An offence under the criminal jurisdiction is tried by a Magistrate or a Judge and the procedure of trial is regulated by the' Code of Criminal Procedure, 1973 which provides as elaborate procedure for flaming of charges, recording of evidence, crossexamination, argument and the judgment. But' charge of contempt is tried on summary process without any fixed procedure as the court is free to evolve its own procedure consistent with fair play and natural justice. In contempt proceedings unlike the trial for a criminal offence no oral evidence is ordinarily recorded and the usual practice is to give evidence by affidavits. Under the English Law a crimi- nal offence is tried by criminal courts with the aid of but a criminal contempt is tried by courts summarily without the aid and assistance of . Ordinarily, process of trial for contempt is summary. A summary form of trial is held in the case of civil contempt and also in the case of criminal contempt where the act is committed in the actual view of the court or by an officer of justice. The summary procedure is applicable by immemorial usage when criminal contempt was committed out of court by a stranger. The practice of pro- ceeding summarily for the punishment of contempt out of court has been the subject of comment and protest, but the practice is founded upon immemorial usage, it has, since the eighteenth century, been generally assumed. We do not con- sider it necessary to refer to decisions from English s which have been discussed in detail in the History of Con- tempt of by . Proceedings for contempt of are not taken in the exercise of original criminal jurisdiction. Proceedings for contempt of are of a peculiar nature; though it may be that in certain aspects they are quasi criminal, but in any view they are-not exer- cised as part of the original criminal jurisdiction of the , as was held in re: and Another. AIR 1935 Calcutta 419. The High held that since the proceedings for contempt of do not fall within the original criminal jurisdiction of the no leave could be granted for appeal to under Clause 41 of the Letters Patent of that . ", " , SCR 454. approached this for transfer of contempt proceedings from to any other under Section 527 of the Criminal Procedure Code, 1898. This . re- jected the application holding that Section 527 of the Criminal Procedure Code did not apply to the contempt pro- ceedings as the contempt jurisdiction is a special jurisdic- tion which is inherent in all courts of record and the Cr. P.C. excludes such a special jurisdiction from the Code . The further held that notwithstanding the provisions contained in the Contempt of s Act , 1926 making an offence of contempt, punishable, the Act does not confer any jurisdiction or create the offence, it merely limits the amount of the punishment which could be awarded and it removes a certain doubt. The jurisdiction to initiate the proceedings and take seisin of the contempt is inherent in a court of record and the procedures of the Criminal Procedure Code do not apply to contempt proceedings. Section 5 of the Code of Criminal Procedure lays down that nothing contained in this Code shall, in the absence of a specific provision to the contrary, affect any special or local law for the time being in force, or any special jurisdiction or power conferred, or any special form of procedure prescribed, by any other law for the time being in force. The power to take proceedings for the contempt of is an inherent power of a of record, the Criminal Procedure Code does not apply to such proceedings. Since, the contempt proceedings are not in the nature of criminal proceedings for an of- fence, the pendency of contempt proceedings cannot be re- garded as criminal proceedings merely because it may end in imposing punishment on the contemner. A contemner is not in the position of an accused, it is open to the to cross-examine the contemner and even if the contemner is found to be guilty of contempt, the may accept apology and discharge the notice of contempt, whereas tendering of apology is no defence to the trial of a criminal offence. This peculiar feature distinguishes contempt proceedings from criminal proceedings. In a criminal trial where a person is accused of an offence there is a public prosecutor who prosecutes the case on behalf of the prsecution against the accused but in contempt proceedings the court is both the accuser as well as the judge of the accusation as ob- served by , CJ in , case AIR 1969 SC I89. Contempt proceeding is sui generis, it has peculiar features which are not found in criminal pro- ceedings. In this view the contemners do not stand in the position of a person accused of an offence\" merely on ac- count of issue of notice of contempt by this and the which was acting on behalf of this had full authority to reord the testimony of the contemners. Commis- sion issued notice and directed , Police Inspector and other Police Officials to place their version of the inci- dent before it and there was no element of compulsion. In this view there has been no violation of Article 20(3) of the Constitution and 's findings are not vitiated. ", "Mr. contended that this has no jurisdiction or power to indict the Police Officers even if they are found to be guilty as their conduct does not amount to contempt of this . He urged that Article 129 and 215 demarcate the respective areas of jurisdiction of the Su- preme and the High s respectively. ", "967 ", "This COurt's Jurisdiction under Article 129 is confined to the contempt of itself only and it has no jurisdiction to intict a person for contempt of an inferior court subordi- nate to . The in exercise of its legislative power under Entry 77 of List 1 read with Entry 14 of List III has enacted Contempt of. s Act 1971 (hereinafter referred to as the 'Act') and that Act does not confer any jurisdiction on this for taking action for contempt of subordinate courts. Instead the original juris- diction of in respect of contempt of subordinate courts is specificially preserved by Sections 11 and 15(2) of the Act. has only appellate powers under Section 19 of the Act read with Articles 134(1)(c) and 136 of the Constitution. The Constitutional and statutory provisions confer exclusive power on for taking action with regard to contempt of inferior or subor- dinate court, and has no jurisdiction in the matter. further urged that in our country there is no court of universal jurisdiction, and the juris- diction of all courts including is limited and this can not enlarge its jurisdiction. learned Attorney General (as he then was) urged that power to punish contempt is a special jurisdiction which is inherent in a court of record. A superior court of record has inherent power to punish for contempt of itself and it necessarily includes and carries with it the power to punish for contempt committed in respect of subordinate or inferior courts. A superior court of record having power to correct the order of inferior court has power to protect that court by punishing those who interfere with the due administration of justice of the court. Articles 129 and 2 15 do not confer any additional jurisdiction on and . The constitutional provisions as well as the legislative enactment \" The Contempt of s Act \" recognise and preserve the existing contempt jurisdiction and power of the court of record for punishing for contempt of subordi- nate or inferior courts. The Act has not affected or re- stricted the suo moto inherent power of being a court of record which has received constitutional sanction under Article 129. Mr. further urged that even otherwise the Act does not restrict or affect the suo moto exercise of power by as a court of record in view of Section 15(1) of the Act. as the Apex is the protector and guardian of justice throughout the land, therefore, it has a right and also a duty to protect the courts whose orders and judgments are amenable to correction, form commission of contempt against them. This right and duty of the Apex is not abrogated merely because also has this right and duty of protection of the subordinate courts. The juris- dictions are concurrent and not exclusive or antagonistic. ", "968 ", "The rival contentions raise the basic question whether has inherent jurisdiction or power to punish for contempt of subordinate or inferior courts under Article 129 of the Constitution and whether the inherent jurisdiction and power of this is restricted by the Act. The answer to the first question depends upon the nature and the scope of the power of this as a court of record, in the background of the original and appellate jurisdiction exercised by this under the various provisions of the Constitution. It is necessary to have a look at the constitutional provisions relating to the origi- nal and appellate jurisdiction of this . Article 124 lays down that there shall be a Supreme of India consisting of Chief Justice of India.and other Judges. Article 32 confers original jurisdiction on this for enforcement of fundamental rights of the citizens. This jurisdiction can be invoked by an aggrieved person even without exhausting his remedy before other courts. Article 129 provides that shall be a court of record and shall have all the powers of such a court includ- ing the power to punish for contempt of itself. Article 13 1 confers original jurisdiction on in cer- tain matters. Article 132 confers appellate jurisdiction on this against any judgment, decree or final order of the High s in India. Articles 133, 134 and 134A confer appellate jurisdiction in in appeals from High s in regard to civil and criminal matters respec- tively on certificate to be issued by the High . Arti- cle 136 provides for special leave to appeal before , notwithstanding the provisions of Articles 132, 133, 134 and 134A. Article 136 vests this with wide powers to grant special leave to appeal from any judg- ment, decree determination sentence or order in any cause or matter passed or made by any court or tribunal in the terri- tory of India except a court or constituted by or under any law relating to the Armed Forces. The 's appellate power under Article 136 is plenary, it may enter- tain any appeal by granting special leave against any order made by any Magistrate. or any other subordinate court. The width and amplitude of the power is not affected by the practice and procedure followed by this in insisting that before invoking the jurisdiction of this under Article 136 of the Constitution, the aggrieved party must exhaust remedy available under the law before the appellate authority or the High . Self imposed restric- tions by this do not divest it of its wide powers to entertain any appeal, against any order or judgment passed by any court or in the country without exhausting alternative remedy before the appellate authority or the High . The power of this under Article 136 is unaffected by Article 132 , 133 , 134 and 134(A) in view of the expression \"notwithstanding anything in this Chapter\" occurring in Article 136. ", "This considered the scope and amplitude of plenary power under Article 136 of the Constitution in ., 1 SCR 267. , J. speaking for the observed: ", "\"The powers given by Article 136 of the Con- stitution however are in the nature of special or residuary powers which are exercisable outside the purview of ordinary law, in cases where the needs of justice demand interference by of the land. The article itself is worded in the widest terms possible. It vests in a plenary juris- diction in the matter of entertaining and hearing appeals, by granting of special leave, against any kind of judgment or order made by a court or Tribunal in any cause or matter and the powers could be exercised in spite of the specific provisions for appeal contained in the Constitution or other laws. The Constitu- tion for the best of reasons did not choose to fetter or circumscribe the powers exercisable under this Article in any way.\" ", " ., 2 SCC 297 this Court entertained an appeal under Article 136 of the Constitution of India by special leave at the in- stance of a complainant against the judgment and the order of acquittal in a murder case and on appraisal of evidence, it set aside the order of acquittal. Objections raised on behalf of the accused relating to the maintainability of the special leave petition under Article 136 of the Constitu- tion, was rejected. , J. speaking for the Court held as under: ", "\" Article 136 of the Constitution of India invests with a plentitude of plenary, appellate power over all courts and in India. The power is plenary in the sense that there are no words in Article 136 itself qualifying that power. But, the very nature of the power has led the court to set limits to itself within which to exercise such power. It is now the well established practice of this to permit the invoca- tion of the power under ArtiCle 136 only in very exceptional circumstances, as when a question of law of general public importance arises or a decision shocks the conscience of the . But, within the restrictions im- posed by itself, this has the undoubted power to interfere even with find- ings of fact, making no distinction between judgments of acquittal and conviction, if the High , in arriving at those findings, has acted \"perversely or otherwise improperly\".\" ", "With regard to the competence of a private party, distin- guished from the , to invoke the jurisdiction of this Court under Article 136 of the Constitution, the Court observed: ", "\"Appellate power vested in under Article136 of the Constitution is not to be confused with ordinary appellate power exercised by appellate courts and appellate tribunals under specific statutes. As we said earlier, it is a plenary power, exercisable outside the purview of ordinary law' to meet the pressing demands of justice (vide ,). Article 136 of the Constitution neither con- fers on anyone the right to invoke the juris- diction of nor inhibits anyone from invoking the 's jurisdiction. The power is vested in but the right to invoke the 's jurisdiction is vested in no one. The exercise of the power of is not circumscribed by any limitation as to who may invoke it.\" ", "There is therefore no room for any doubt that this has wide power to interfere and correct the Judgment and orders passed by any court or in the country. In addition to the appellate power, the has special residuary power to entertain appeal against any order of any court in the country. The plenary jurisdiction of this to grant leave and hear appeals against any order of a court or , confers power of judicial superintendence over all the courts and s in the territory of India including subordinate courts of Magistrate and District Judge. This has, therefore, supervisory jurisdiction over all courts in India. ", " Article 129 provides that shall be a court of record and shall have all the powers of such a court including the power to punish for contempt of itself. Article 215 contains similar provision in respect of . Both as well as s are courts of record having powers to punish for contempt in- cluding the power to punish for contempt of itself. The Constitution does not define \"Court of Record\". This expres- sion is well recognised in jurisdical world. In Jowitt's Dictionary of English Law, \"Court of Record\" is defined as: ", "971 ", "\"A court whereof the acts and judicial pro- ceedings are enrolled for a perpetual memorial and testimony, and which has power to fine and imprison for contempt of its authority.\" ", "In 's Law Lexicon, Court of Record is defined as: ", "\"Courts are either of record where their acts and judicial proceedings are enrolled for a perpetual memorial and testimony and they have power to fine and imprison; or not of record being courts of inferior dignity, and in a less proper sense --and these are not entrusted by law with any power to fine or imprison the subject of the realm, unless by the express provision of some Act of Parliament. These proceedings are not enrolled or recorded.\" ", "In Words and Phrases (Permanent Edition) Vol. 10 page 429, \"Court of Record\" is defined as under: ", "\" is a court where acts and judicial proceedings are enrolled in parchment for a perpetual memorial and testimony, which rolls are called the \"record\" of the court, and are of such high and supereminent authori- ty that their truth is not to be questioned.\" ", "Halsbury's Laws of England Vol. 10 page 319, states: ", "\"Another manner of division is into courts of record and courts not of record. Certain Courts are expressly declared by statute to be courts of record. In the case of courts not expressly declared to be courts of record, the answer to the question whether a court is a court of record seems to depend in general upon whether it has power to fine or imprison, by statute or otherwise, for contempt of itself or other substantive offences; if it has such power, it seems that it is a court of record........ proceedings of preserved in its archives are called records, and are conclusive evidence of that which is recorded therein.\" ", "In England a superior court of record has been exercised power to indict a person for the contempt of its authority and also for the contempt of its subordinate and inferior courts in a summary manner without the aid and assistance of Jury. This power was conceded as a necessary attribute of a superior court of record under . The con- cept of inherent power of the superior court of record to indict a person by summary procedure was considered in detail in v. , 97 ER 94 commonly known as 's case. In that case initiated proceedings for contempt against John , a book-seller for publishing a libel on the Chief Justice, Lord . On behalf of the contemner objection was taken to the summary procedure followed by the . After lengthy arguments judgment was prepared by Chief Justice holding that a libel on a Judge was punishable by the process of attachment without the intervention of a Jury, as the summary form of procedure was founded upon immemorial usage. The judgment prepared with great learning and erudition could not be delivered as the proceedings were dropped following the change of Govern- ment. After long interval 's judgment was published in 1802. The judgment proceeded on the assumption that the superior Common Law s did have the power to indict a person for contempt of court, by following a summary proce- dure on the principle that this power was 'a necessary incident to every court of justice'. Undelivered judgment of , has been subject of great controversy in England' and Sir has severely criticised 's case, in his celebrated book \"The History of Contempt of ', The Form of Trial and Mode of Punishment: In spite of serious criticism of the judgment of , the opinion ex- pressed by him has all along been followed by the English and Commonwealth s. In v. The Justices of , 8 Moors PC 47 at 54 on an application for leave to appeal against the order of the of for contempt of court, upheld the order on the ground that the court of being a of Record was the sole and exclusive judge of what amounted to contempt of court. ", "In India, the courts have followed the English practice in holding that a court of record has power of summarily punishing contempt of itself as well as of subordinate courts. In v. The Chief Justice and Judges of at Fort William in Bengal, ILR to Calcutta 109 of Calcutta in 1883 convicted , who was Editor and Proprietor of for contempt of court and sentenced him to imprisonment for two months for publishing libel reflecting upon a Judge in his judicial capacity. On appeal upheld the order of and observed that s in Indian Presidencies were superior courts of record, and the powers of as superior courts in India are the same as in Eng- land. further held that by common law every court of record was the sole and exclusive judge of what amounts to a contempt of court. In case this considered the origin, history and development of the concept of inherent jurisdiction of a court of record in India. The after considering and decisions held that being a court of record has inherent power to punish for contempt of subordinate courts. The further held that even after the codification of the law of contempt in India 's jurisdiction as a court of record to initi- ate proceedings and take seisin of the matter remained uneffected by the Contempt of s Act , 1926. Mr. contended that even if is a court of record, it has no power to take action for the contempt of a Chief Judicial Magistrate's court as neither the Constitution nor any statutory provision confer any such jurisdiction or power on this . He further urged that so far as is concerned, it has power of judicial and administrative superintendence over the subor- dinate courts and further Section 15 of the Act expressly confers power of to take action for the contempt of subordinate courts. This being a court of record has limited jurisdiction to take action for contempt of itself under Article 129 of the Constitution, it has no jurisdiction to indict a person for the contempt of subordi- nate or inferior courts. ", "The question whether in the absence of any express provision has inherent power in respect of contempt of subordinate or inferior courts, has been consid- ered by English and Indian Courts. We would briefly refer to some of those decisions. In the leading case of v. , [1903] 2 K.B. 432 at 442. , J. observed: ", "\"This Court exercises a vigilant watch over the proceedings of inferior courts and suc- cessfully prevents them from usurping powers which they do not possess, or otherwise acting contrary to law. It would seem almost a natu- ral corollary that it should possess correla- tive powers of guarding them against unlawful attacks and interferences with their independ- ence on the part of others.\" ", "In King v. , [1906] 1 K.B. 32. Wills, further held that being a court of record must protect the inferior courts from unauthorised interference, and this could only be secured by action of as the inferior courts have no power to protect themselves and for that purpose this power is vested in superior court of record. Since is the custos morum of the kingdom it must apply to it with the necessary adaptations to the altered circumstances of the present day to uphold the independence of the judiciary. The principle laid down in v. , was followed in King v. Editor of , [1921] 2 KB 733 where it was held that as a court of record has inherent jurisdiction to punish for contempt of a court martial which was an inferior court. , observed: ", "\"The result of that judgment ( v. ) is to show that wherever this Court has power to correct an inferior court, it also has power to protect that court by punishing those who interfere with Due administration of ,justice in their court.\" ", "In Attorney--General v. B.B.C., [1980] 3 ALR 16 1 proceeded on the assumption that a court of record possesses protective jurisdiction to indict a person for interference with the administration of justice in the inferior courts but it refused to indict as it held that this protection is available to a court exercising judicial power of the State and not to a even though the same may be inferior to the court of record. These authori- ties show that in England the power of to deal with the contempt of inferior court was based not so much on its historical foundation but on 's inherent jurisdiction being a court of record having juris- diction to correct the orders of those courts. ", "In India prior to the enactment of the Contempt of Courts Act , 1926, jurisdiction in respect of contempt of subordinate and inferior courts was regulated by the principles of Common Law of England. in the absence of statutory provision exercised power of con- tempt to protect the subordinate courts on the premise of inherent power of . in the case of , 21 Madras Law Journal 832 held that it being a court of record had the power to deal with the contempt of subordinate courts. in , 22 Bombay Law Reporter 368 case held that possessed the same powers to punish the contempt of subordinate courts as had by virtue of the Common Law of England. Similar view was expressed by in , case AIR 1926 Allahabad 623 and ., AIR 1930 Allahabad 225 (FB). In case (supra) of after considering the question in detail held: ", "\" as a court of record and as the protector of public justice through out its jurisdiction has power to deal with con- tempts' directed against the administration of justice, whether those contempts are committed in face of the court or outside it, and inde- pendently or whether the particular court is sitting or not sitting, and whether those contempts relate to proceedings directly concerning itself or whether they relate to proceedings concerning an inferior court, and in the latter case whether those proceedings might or might not at some stage come before .\" ", "Similar view was taken by the Nagpur and Lahore in Mr. v. , AIR 1935 Nagpur 16; , AIR 1937 Lahore 197 and took the same view in v. ., AIR 1939 Oudh 13 1. But, took a contrary view in Legal Remembrancer v. Motilal Ghosh, ILR 41 Cal. 173 holding that there was no such inherent power with . ", "Judicial conflict with regard to power with regard to the contempt of subordinate court was set at rest by the Contempt of Courts Act 1926. The Act resolved the doubt by recognising to the power of in regard to contempt of subordinate courts, by enacting Section 2 which expressly stated that the will continue to have jurisdiction and power with regard to contempt of subordinate courts as they exercised with regard to their own contempt. Thus the Act reiterated and recognised the power as a court of record for taking action for contempt of courts subordinate to them. The only excep- tion to this power, was made in subsection (3) of Section 2 which provided that shall take cognizance of a contempt alleged to have been committed in respect of a court subordinate to it where such contempt is an offence punishable under the Indian Penal Code . Section 3 of the Act restricted the punishment which could be passed by . Since doubt was raised whether as a court of record could punish contempt of itself and of courts subordinate to it if contempt was committed outside its territorial jurisdiction, the enacted the Con- ", "976 ", "tempt of s Act 1952 removing the doubt. Section 3 of the 1952 Act again reiterated and reaffirmed the power, authority and jurisdiction of in respect of contempt of courts subordinate to it, as it existed prior to the enactment. It provided that every shall have and exercise the same jurisdiction, power and authority, in accordance with the same procedure and prac- tice in respect of contempt of courts subordinate to it as it has and exercise in respect of contempt of itself. Sec- tion 5 further expanded the jurisdiction of for indicting a person in respect of contempt committed outside the local limits of its jurisdiction. The Parliamen- tary legislation did not confer any new or fresh power or jurisdiction on s in respect of contempt of courts subordinate to it, instead it reaffirmed the inherent power of , having same jurisdiction, power and authority as it has been exercising prior to the enact- ments. The effect of these statutory provisions was consid- ered by this in case, and the held that contempt jurisdiction was a special one inherent in the very nature of a court of record and that jurisdiction and power remained unaffected even after the enactment of 1926 Act as it did not confer any new jurisdic- tion or create any offence, it merely limited the amount of punishment which could be awarded to a contemner. The juris- diction of to initiate proceedings or taking action for contempt of its subordinate courts remained as it was prior to the 1926 Act. In v. State of Tamil Nadu, AIR 1972 SC 858 the again emphasised that in view of Article 215 of the Constitution, as a court of record possesses inherent power and jurisdiction, which is a special one, not arising or derived from Contempt of s Act and the provisions of Section 3 of 1926 Act, do not affect that power or confer a new power or jurisdic- tion. The further held that in view of Article 215 of the Constitution, no law made by a could take away the Jurisdiction conferred on nor it could confer it afresh by virtue of its own authority. The English and the Indian authorities are based on the basic foundation of inherent power of , having jurisdiction to correct the judicial orders of subor- dinate courts. in England and s in India being superior and having judicial power to correct orders of subordinate courts enjoyed the inherent power of contempt to protect the subordinate courts. being under Article 129 and having wide power of judicial supervision over all the courts in the country, must possess and exer- cise similar jurisdiction and power as s had prior to Contempt Legislation in 1926. Inherent powers of a superior have remained unaffect- ed even after Codification of Contempt Law. The Contempt of s Act 1971 was enacted to define and limit the powers of courts in punishing contempts of courts and to regulate their procedure in relation thereto. Section 2 of the Act defines contempt of court including criminal contempt. Sections 5 , 6 , 7 , 8 , and 9 specify matters which do not amount to contempt and the defence which may be taken. Section 10 which relates to the power of to punish for contempt of subordinate courts. Section 10 like Section 2 of 1926 Act and Section 3 of 1952 Act reiterates and reaffirms the jurisdiction and power of a in respect of its own contempt and of subordinate courts. The Act does not confer any new jurisdiction instead it reaf- firms s power and jurisdiction for taking action for the contempt of itself as well as of its subordi- nate courts. We have scanned the provisions of the 1971 Act, but we find no provision therein curtailing power with regard to contempt of subordinate courts, Section 15 on the other hand expressly refers to this 's power for taking action for contempt of subordinate courts. Mr. contended that under Section 15 Parlia- ment has exclusively conferred power on to punish for the contempt of subordinate courts. The legisla- tive intent being clear, this has no power under its inherent jurisdiction or as a court of record under Article 129 of the Constitution with regard to contempt of subordi- nate courts. Section 15 of the Act reads as under: ", "\"15. Cognizance of criminal contempt in other cases--(1) In the case of a criminal contempt, other than a contempt referred to in Section 14 , or may take action on its own motion or a motion made by-- ", "(a) the Advocate-General, or ", "(b) any other person, with the con- sent in writing of the Advocate-General (or) ", "(c) in relation to , such Law Officer as the Central Government may by notification in the official , specify in this behalf or any other person, with the consent in writing of such Law Officer. ", "(2) In the case of any criminal contempt of subordinate court, may take action on a reference made to it by the subordinate Court or on a motion made by the Advocate-General or, in, relation to a Union Territory, by such Law Officer as the Central Government may, by notification in the official , specify in this behalf. ", "(3) Every motion or reference made under this section shall specify the contempt of which the person charged is alleged to be guilty. Explanation--In this section, the expression \"Advocate General\" means- ", "(a) in relation to , the Attorney General or the Solicitor General; ", "(b) in relation to , the Advocate General of the or any of the s for which has been established; ", "(c) in relation to the Court of a Judicial Commissioner, such Law Officer as the Central Government may, by notification in the official , specify in this behalf. ", "Under sub-section (1) and both have power to take cognizance of criminal contempt and it provides three modes for taking cognizance. and the both may take cognizance on its own motion or on the motion made by the Advocate-General or any other person with the consent in writing of the Advocate- General. Sub-section (2) provides that in case of any crimi- nal contempt of subordinate court, the may take action on a reference made to it by the subordinate court or on a motion made by the Advocate-General, and in, relation to a Union Territory, on a motion made by any officer as may be specified by the Government. Thus Section 15 prescribes modes for taking cognizance of criminal contempt by the and , it is not a substantive provision conferring power or jurisdiction on the or on for taking action for the contempt of its subordinate courts. The whole object of prescribing proce- dural modes of taking cognizance in Section 15 is to safe- guard the valuable time of the' and being wasted by frivolous complaints of contempt of court. Section 15(2) does not restrict the power of the to take cognizance of the contempt of itself or of a subordinate court on its own motion although apparently the Section does not say so. , 2 SCR 331 this held that Section 15 prescribed procedure for taking cognizance and it does not affect the 's suo moto power to take cogni- zance and punish for contempt of subordinate courts. Mr. urged that under Entry 77 of List I of the VIIth Schedule the has legislative competence to make law curtailing the jurisdiction of . He further urged that Section 15 curtails the inherent power of this with regard to contempt of subordinate courts. Entry 77 of List 1 states: \"Constitution, organisation, jurisdiction and powers of (including contempt of such ), and the fees taken therein; persons entitled to practise before .\" This Entry. read with Article 246 confers power on the to enact law with respect to the constitution, organisation, jurisdiction and powers of including the contempt of this court. The is thus competent to enact a law relating to the powers of with regard to 'contempt of itself' such a law may prescribe procedure to be followed and it may also prescribe the maximum punishment which could be awarded and it may provide for appeal and for other matters. But the Central Legisla- ture has no legislative competence to abridge or extinguish the jurisdiction or power conferred on this under Article 129 of the Constitution. The 's power to legislate in relation to law of contempt relating to is limited, therefore the Act does not impinge upon this 's power with regard to the contempt of subordi- nate courts under Article 129 of the Constitution. Article 129 declares a court of record and it further provides that shall have all the powers of such a court including the power to punish for contempt of itself (emphasis supplied). The expression used in Article 129 is not restrictive instead it is exten- sive in nature. If the Framers of the Constitution intended that shall have power to punish for con'- tempt of itself only, there was no necessity for inserting the expression \"including the power to punish for contempt of itself'. The Article confers power on to punish for contempt of itself and in addition, it confers some additional power relating to contempt as would appear from the expression '*including\". The expression \"including\" has been interpreted by courts, to extend and widen the scope of power. The plain language of Article clearly indi- cates that this as a court of record has power to punish for contempt of itself and also something else which could fall within the inherent jurisdiction of a court of record. In interpreting the Constitution, it is not permis- sible to adopt a construction which would render any expres- sion superfluous or redundant. The courts ought not accept any such construction. While construing Article 129 , it is not permissible to ignore the significance and impact of the inclusive power conferred on . Since, is designed by the Constitution as a court of record and as the Founding Fathers were aware that a superi- or court of record had inherent power to indict a person for the contempt of itself as well as of courts inferior to it, the expression \"including\" was deliberately inserted in the Article. Article 129 recognised the existing inherent power of a court of record in its full plenitude including the power to punish for the contempt of inferior courts. If Article 129 is susceptible to two interpretations, we would prefer to accept the interpretation which would preserve the inherent jurisdiction of this being the superior court of record, to safeguard and protect the subordinate judici- ary, which forms the very back bone of administration of justice. The subordinate courts administer justice at the grass root level, their protection is necessary to preserve the confidence of people in the efficacy of s and to ensure unsullied flow of justice at its base level. Disputing the inherent power of this with regard to the contempt of subordinate courts, Mr. contended that inherent powers are always preserved, but they do not authorise a court to invest itself with jurisdiction when that jurisdiction is not conferred by law. He urged that the status of an appellate court like , does not enable the to claim original jurisdiction not vested by law. Similarly, having appellate jurisdiction under Section 19 of the Contempt of s Act 1971, cannot invest itself with original jurisdiction for contempt of subordinate courts. He placed reliance on the decision of this in ., 2 SCR 800. We are unable to accept the contention. In case (supra), had entertained an original suit and issued injunction under the Trade and Merchandise Marks Act 1958 although under the Act the suit was required to be instituted in the District . In appeal before this , order of the was sought to be justified on the ground of 's power of transfer under Section 24 read with its inherent power under Section 151 of the Code of Civil Proce- dure. This rejected the submission on the ground that exercise of jurisdiction under Section 24 of Code of Civil Procedure was conditioned by lawful institution of the proceeding in a subordinate court of competent jurisdiction, and transfer thereof to the . The observed that power to try and dispose of proceedings, after transfer from a court lawfully-seized of it, does not involve a power to entertain a proceeding which is not otherwise within the cognizance of the . Referring to the claim of inherent powers under Section 151 to justify entertainment of the suit grant of injunction order, the observed that the inherent power could be exercised where there is a proceeding lawful- ly before the , it does not, however, authorise the to invest itself with jurisdiction where it is not conferred by law. The facts and circumstances as available in the case, were quite dif- ferent and the view expressed in that case do not have any bearing on the inherent power of this . In case there was no issue before the regarding the inherent power of a superior court of record instead the entire case related to the interpretation of the statutory provisions conferring jurisdiction on the . Where jurisdiction is conferred on a court by a statute, the extent of jurisdiction is limited to the extent prescribed under the statute- But there is no such limitation on a superior court of record in matters relating to the exercise of constitutional powers. No doubt this has appellate jurisdiction under Section 19 of the Act, but that does not divest it of its inherent power under Article 129 of the Constitution- The conferment of appellate power on the court by a statute does not and cannot affect the width and ampli- tude of inherent powers of this under Article 129 of the Constitution. ", "We have already discussed a number of decisions holding that being a court of record has inherent power in respect of contempt of itself as well as of its subordinate courts even in the absence of any express provi- sion in any Act. A fortiori being of the country and superior court of record should possess the same inherent jurisdiction and power for taking action for contempt of itself, as well as, for the contempt of subordinate and inferior courts. It was contended that since has power of superintendence over the subordinate courts under Article 227 of the Constitution, therefore, has power to punish for the contempt of subordinate courts. Since has no super- visory jurisdiction over or other subordinate courts, it does not possess powers which s have under Article 215. This submission is misconceived. Article 227 confers supervisory jurisdiction on and in exercise of that power may correct judicial orders of subordinate courts, in addition to that, has administra- tive control over the subordinate courts. power to correct judicial orders of the subordinate courts under Article 136 is much wider and more effective than that contained under Article 227. Absence of administrative power of superintendence, over and subordinate court does not affect this 's wide power of judicial superintendence of all courts in India. Once there is power of judicial superintendence, all the s whose orders are amenable to correction by this would be subordinate courts and therefore this also possesses similar inherent power as has under Article 215 with regard to the contempt of subordinate courts. The jurisdic- tion and power of a superior of Record 'to punish contempt of subordinate courts was not founded on the court's administrative power of superintendence, instead the inherent jurisdiction was conceded to superior of Record on the premise of its judicial power to correct the errors of subordinate s. ", "Mr. urged that assumption of contempt jurisdic- tion with regard to contempt of subordinate and inferior courts on the interpretation of Article 129 of the Constitu- tion is foreclosed by the decisions of , he placed reliance-on the decisions of in v. The Hon'ble the Chief Justice and Judges of ., AIR 1942 FC 1 and v. ., FCR 364. He urged that this being successor to was bound by the decisions of the under Arti- cle 374(2) of the Constitution. Mr. , learned Attor- ney-General seriously contested the proposition, he contend- ed that there is a marked difference between the and this , former being established by a statute with limited jurisdiction while this is the constitutional court with unlimited jurisdiction, therefore, the decisions are not binding on this . He urged that Article 374(2) does not bind this with the decisions of the , instead it provides for meeting particular situation during transitory period. In the alternative learned Attorney-General urged that the aforesaid two decisions of in 's case and 's case do not affect the jurisdiction and power of this with regard to contempt of subordinate and infe- rior courts as the had no occasion to inter- pret any provision like Article 129 of the Constitution in the aforesaid decisions. Article 374 made provision for the continuance of Judges as the Judges of the Supreme on the commencement of the Constitution and it also made provisions for transfer of the proceedings pending in the to the Supreme . Clause (2) of Article 374 is as under: ", "\"All suits, appeals and proceedings, civil or criminal, pending in at the commencement of this Constitution shall stand removed to , and shall have jurisdiction to hear and determine the same, and the judgments and orders of delivered or made before the commencement of this Constitution shall have the same force and effect as if they had been delivered or made by .\" ", "On the promulgation of the Constitution, ceased to exist and was set up and with a view to meet the changed situation, provisions had to be made with regard to the matters pending before the . Article 374(2) made provision for two things, firstly it directed the transfer of all suits, appeals and proceed- ings, civil or criminal pending before the to . Secondly, it provided that any orders and judgments delivered or made by the before the commencement of the Constitution shall have the same force and effect as if those orders or judgments had been deliv- ered or made by . This was necessary for the continuance of the proceedings before . The may have passed interlocutory orders, it may have delivered judgments in the matters pending before it and in order to maintain the continuance of validity of orders or judgments of a legal fiction was created stating that those judgments and orders shall be treated as of . Article 374(2) is in the nature of transitory provision to meet the exigency of the situa- tion on the abolition of the and setting of . There is no provision in the aforesaid Article to the effect that the decisions of the shall be binding on . Similar view was taken by in , AIR 195 1 Allahabad 205 para 43 and in ., AIR 1954 Bombay 352 para 14. The decisions of and made before the com- mencement of the Constitution are entitled to great respect but those decisions are not binding on this Court and it is always open to this Court to take a different view. , SCR 786 at 795 and . 1 SCR 1 at 24 and 25. decisions were not followed by this Court. There is, therefore, no merit in the contention that this Court is bound by the decisions of the . But even otherwise the decisions of in case and case have no bearing on the interpretation of Article 129 of the Consti- tution. In case the facts were that , an Advocate of was involved in litigation of various kinds including a case connected with his insol- vency. A Special Bench of was constituted to decide his matters. His objection against the sitting of a particular Judge on the Special Bench, was rejected. His application for the grant of certificate under Section 205 of the Government of India Act to file appeal against the order of before the was refused. filed a petition before the for the issue of direction for the transfer of his case to from . The held that appeal against the order of refusing to grant certificate was not maintainable. argued that was guilty of contempt of as it had deliberately and maliciously deprived the 's jurisdiction to hear the appeal against its orders. , CJ. rejected the contention in the following words: ", "\"We have had occasion more than once to con- strue the provisions of Section 205 , and we repeat what we have already said, that no appeal lies to this in the absence of the certificate prescribed by that Section: a certificate is the necessary condition prece- dent to every appeal. We cannot question the refusal of to grant a certificate or investigate the reasons which have prompted the refusal; we cannot even inquire what those reasons were, if has given none. The matter is one exclusively for ; and, as this observed in an earlier case, it is not for us to speculate whether omitted per incuriam to give a right of appeal against the refusal to grant a certificate or trusted s to act with reasonableness and impartiality: 1939 FCR 13 at page 16. The jurisdiction of the being thus limited by the statute in this way, how could it be extended by acting even perversely or maliciously in withholding the certificate.\" ", "In case an application purporting to invoke extraordinary original jurisdiction of under Section 2 10(2) of the Government of India Act, 1935 was made with a prayer that should itself deal directly with an alleged contempt of , subordinate to . By a short order the Court rejected the application placing reliance on its decision in case. The Court observed as under: ", "\"The expression \"any contempt of court\" in that provision must be held to mean \"any act amounting to contempt of this \". This was the view expressed in 's case and we have been shown no reason for departing from that view. Under the Indian Law have power to deal with contempt of any subordinate to them as well as with contempt of . It could not have been intended to confer on the Federal a concurrent jurisdiction in such matters. The wider construction may conceivably lead to conflicting judgments and to other anomalous con sequences.\" ", "In the case of found itself helpless in the matter as the Government of India Act, 1935 did not confer any power on it to entertain an appeal against the order of refusing to grant certifi- cate. The decision has no bearing on the question which we are concerned. In case the decision turned on the interpretation of Section 210(2) of the 1935 Act. Section 2 10 made provisions for the enforcement of decrees and orders of . Sub-section (2) provid- ed that shall have power to make any order for the purpose of securing the attendance of any person, the discovery or production of any documents or the investiga- tion or \"punishment of any contempt of court\", which any has power to make as respects the territory within its jurisdiction, and further shall have power to award costs and its orders shall be enforce- able by all courts. While interpreting Section 2 10(2) held that it had no power to deal with con- tempt of any court subordinate to and it further observed that the wider constructions may lead to conflict- ing judgments and to other anomalous consequences. It is not necessary for us to consider the correctness of the opinion expressed by , as in our view was a court of limited jurisdiction, it was not like this Court as against the judgment, order and decree of appeals lay to . The exercised limited jurisdiction as conferred on it by the 1935 Act. The question regarding the inherent power of in respect of the Contempt of Subordinate court was neither raised nor discussed in afore- said decisions. The observed that if the and both have concurrent jurisdic- tion in contempt matters it could lead to conflicting judg- ments and anomalous consequences, that may be so under the Government of India Act as the and did not have concurrent jurisdiction, but under the Constitution, and both have concurrent jurisdiction in several matters, yet no anomalous consequences follow. ", "While considering the decision of , it is necessary to bear in mind that the did not possess wide powers as this has under the Constitu- tion. There are marked differences in the constitution and jurisdiction and the amplitude of powers exercised by the two courts. In addition to civil and criminal appellate jurisdiction, this has wide powers under Article 136 over all the courts and in the country. The Feder- al had no such power, instead it had appellate power but that too could be exercised only on a certificate issued by the High . The was a court of record under Section 203 but it did not possess any plenary or residuary appellate power over all the courts functioning in the territory of India like the power conferred on this under Article 136 of the Constitution, therefore, the had no judicial control or superintendence over subordinate courts. ", "Advent of freedom, and promulgation of Constitution have made drastic changes in the administration of justice neces- sitating new judicial approach. The Constitution has as- signed a new role to to ensure rule of law in the country. These changes have brought new perseptions. In interpreting Constitution, we must have regard to the social, economic and political changes, need of the community and the independence of judiciary. The court cannot be a helpless spectator, bound by precedents of colonial days which have lost relevance. Time has come to have a fresh look to the old precedents and to lay down law with the changed perceptions keeping in view the provisions of the Constitution. \"Law\", to use the words of Lord , \"grows; and though the principles of law remain un- changed, yet their application is to be changed with the changing circumstances of the time.\" The considerations which weighed with in rendering its deci- sion in 's and 's case are no more relevant in the context of the constitutional provisions. ", "987 ", "Since this has power of judicial superintendence and control over all the courts and functioning in the entire territory of the country, it has a corresponding duty to protect and safeguard the interest of inferior courts to ensure the flow of the stream of justice in the courts without any interference or attack from any quarter. The subordinate and inferior courts do not have adequate power under the law to protect themselves, therefore, it is necessary that this court should protect them. Under the constitutional scheme this court has a special role, in the administration of justice and the powers conferred on it under Articles 32, 136, 14 1 and 142 form part of basic structure of the Constitution. The amplitude of the power of this under these Articles of the Constitution cannot be curtailed by law made by . If the contention raised on behalf of the contemners is accept- ed, the courts all over India will have no protection from this . No doubt High s have power to persist for the contempt of subordinate courts but that does not affect or abridge the inherent power of this court under Article ", "129. and both exercise concurrent jurisdiction under the constitutional scheme in matters relating to fundamental rights under Article 32 and 226 of the Constitution, therefore this 's jurisdiction and power to take action for contempt of subordinate courts would not be inconsistent to any constitutional scheme. There may be occasions then attack on Judges and Magistrate of subordinate courts may have wide repercussions through out the country, in that situation it may not be possible for to contain the same, as a result of which the administration of justice in the country may be paraly- sed, in that situation must intervene to ensure smooth functioning of courts. is duty bound to take effective steps within the constitutional provisions to ensure a free and fair administration of justice through out the country, for that purpose it must wield the requisite power to take action for contempt of subordinate courts. Ordinarily, would protect the subordinate court from any onslaught on their independ- ence, but in exceptional cases, extra ordinary situation may prevail affecting the administration of public justice or where the entire judiciary is affected, this may directly take cognizance of contempt of subordinate courts. We would like to strike a note of caution that this will sparingly excercise its inherent power in taking cogni- zance of the contempt of subordinate courts, as ordinarily matters relating to contempt of subordinate courts must be dealt with by s. The instant case is of excep- tional nature, as the incident created a situation where functioning of the subordinate courts all over the country was adversely affected, and the administration of justice was paralysed, therefore, this took cognizance of the matter. Mr. contended that in our country there is no court of universal jurisdiction, as the jurisdiction of all courts including is limited. Article 129 as well as the Contempt of s Act 1971 do not confer,any express power to this with regard to contempt of the subordinate courts, this cannot by construing Article 129 assume jurisdiction in the matter which is not entrusted to it by law. He placed reliance on the observations of this in & Ors. v. ., 3 SCR 744 at 77 1. We have carefully considered the decision but we find nothing therein to support the contention of Mr. . It is true that courts constituted under a law enacted by the or have limited jurisdiction and they cannot assume jurisdiction in a matter, not expressly as- signed to them, but that is not so in the case of a superior court of record constituted by the Constitution. Such a court does not have a limited jurisdiction instead it has power to determine its own jurisdiction. No matter is beyond the jurisdiction of a superior court of record unless it is expressly shown to be so, under the provisions of the Con- stitution. In the absence of any express provision in the Constitution the court being a court of record has jurisdiction in every matter and if there be any doubt, the has power to determine its jurisdiction. If such determination is made by High , the same would be subject to appeal to this , but if the jurisdiction is determined by this it would be final. Halsbury's Laws of England Vol. 10 Para 7 13, states: ", "\"Prima facie no matter is deemed to be beyond the jurisdiction of a superior court unless it is expressly shown to be so, while nothing is within the jurisdiction of an inferior court unless it is expressly shown on the face of the proceedings that the particular matter is within the cognizance of the particular court.\" ", "The above principle of law was approved by this in Special Reference No. I of 1964 [1965] 1 SCR 413 at 499 in holding that the, being a superior court of record was entitled to determine its own jurisdiction in granting interim bail to a person against whom warrant of arrest had been issued by the Speaker of a State Legisla- ture. In 's case (supra) this again reiterated the principles that a superior court of record unlike a court of limited jurisdiction is entitled to determine about its own jurisdiction. , 1 SCC 75 the emphasised that the Constitution has left it to the judicial discretion of to decide for itself the scope and limits of its jurisdiction in order to render substantial justice in matters coming before it. We therefore hold that this being the Apex and a superior court of record has power to determine its jurisdiction under Article 129 of the Constitution, and as discussed earlier it has jurisdiction to initiate or entertain proceedings for contempt of subor- dinate courts. This view does not run counter to any provi- sion of the Constitution. ", "Constitutional hurdles over, now we would revert back to the incident which has given rise to these proceedings. The genesis of the unprecedented attack on the subordinate judiciary arose out of confrontational attitude of the local police against the Magistracy in Kheda. The Chief Judicial Magistrate is head of the Magistracy in the District. Under the provisions of Chapter XII of the Code of Criminal Proce- dure, 1973, he exercises control and supervision over the investigating officer. He is-an immediate officer on the spot at the lower rung of the administration of justice of the country to ensure that the which is the law enforcing machinery acts according to law m investigation of crimes without indulging into excesses and causing harass- ment to citizens. The main objective of is to appre- hend offenders, to investigate crimes and to prosecute them before the courts and also to prevent commission of crime and above all to ensure law and order to protect the citi- zens life and property. The law enjoins the to be scrupulously fair to the offender and the Magistracy is to ensure fair investigation and fair trial to an offender. The purpose and object of Magistracy and are complemen- tary to each other. It is unfortunate, that these objectives have remained unfulfilled even after 40 years of our Consti- tution. Aberrations of officers and excesses in dealing with the law and order situation have been the subject of adverse comments from this court as well as from other courts but it has failed to have any corrective effect on it. The has power to arrest a person even without obtaining a warrant of arrest from a court. The amplitude of this power casts an obligation on the to take maximum care in exercising that power. The must bear in mind, as held by this Court that if a person is arrested for a crime, his constitutional and fundamental rights must not be violated. See: ., 4 SCC 494. In (supra) case 526, this Court considered the question of placing a prisoner under handcuff by the . The Court declared that no prisoner shall be handcuffed or lettered routinely or merely for the convenience of custody or escort. The Court empha- sised that the did not enjoy any unrestricted or unlimited power to handcuff an arrested person. If having regard to the circumstances including the conduct, behaviour and character of a prisoner, there is reasonable apprehension of prisoner's escape from custody or disturbance of peace by violence, the may put the prisoner under handcuff. If a prisoner is handcuffed without there being any justifica- tion, it would violate prisoner's fundamental rights under Articles 14 and 19 of the Constitution. To be consistent with Articles 14 and 19 handcuffs must be the last refuge as there are other ways for ensuring security of a prisoner. In case, observed: ", "\"If today freedom of the ferlorn person fails to the police somewhere tomorrow the freedom of many may fall else where with none to whimper unless the court process invigilates and polices the police before it is too late.\" ", "The prophetic words of , have come true as the facts of the present case would show. ", "In the instant case, , CJM, was assaulted, arrested and handcuffed by Inspector and other Officers. The Officers were not content with this, they tied him with a thick rope round his arms and body as if N.L. was a wild animal. As discussed earlier, he was taken in that condition to the hospital for medical examination where he was made to sit in varanda exposing him to the public gaze, providing opportunity to the members of the public to see that the had the power and privi- lege to apprehend and deal with a Chief Judicial Magistrate according to its sweet will. What was the purpose of unusual behaviour of the police, was it to secure safety and securi- ty of N.L. , or was it done to prevent escape or any violent activity on his part justifying the placing of handcuffs and ropes on the body of N.L. . The Commis- sion has recorded detailed findings that the object was to wreck vengeance and to humiliate the CJM who had been polic- ing the police by this judicial orders. We agree with the findings recorded by the that there was no justi- fication for this extraordinary and unusual behaviour of Inspector and other Officers although they made an attempt to justify their unprecedented, dehuma- nising behaviour on the ground that was drunk, and he was behaving in violent manner and if he had not been hand- cuffed or tied with ropes, he could have snatched 's revolver and killed him. We are amazed at the reasons given by justifying the hand- cuffs and ropes on the body of N.L. . was un- armed, he was at the Station in a room, there were at least seven police officials present in the room who were fully armed, yet, there was apprehension about 's escape or violent behaviour justifying handcuffs and roping. The justification given by them is flimsy and preposterous. S.R. acted in utter disregard of this 's direc- tion in case. His explanation that he was not aware of the decision of this is a mere pre- tence as the er has recorded findings that Gujarat Government had issued Circular letter to the incorpo- rating the guide lines laid down by this in case with regard to the handcuffing of prisoner. ", "What constitutes contempt of court? The Common Law definition of contempt of is: 'An act or omission calculated to interfere with the due administration of justice.' (Bowen L.J. in v. , [1886] 35 Ch. D. 436 at 455. The contempt of court as defined by the Contempt of s Act , 1971 includes civil and criminal contempt. Criminal contempt as defined by the Act: 'Means the publica- tion whether by words, spoken or written, or by signs, or by visible representations, or otherwise of any matter or the doing of any other act whatsoever which scandalizes or tends to scandalize, or lowers or tends to lower the authority of, any court; or prejudices, or interferes or tends or to interfere with, the due course of any judicial proceeding; or interferes, or tends to interfere with, or obstructs or tends to obstruct, the administration of justice in any other manner. The definition of criminal contempt is wide enough to include any act by a person which would tend to interfere with the administration of justice or which would lower the authority of court. The public have a vital stake in effective and orderly administration of justice. The has the duty of protecting the interest-of the commu- nity in the due administration of justice and, so, it is entrusted with the power to commit for contempt of court, not to protect the dignity of the against insult or injury, but, to protect and vindicate the right of the public so that the administration of justice is not pervert- ed, prejudiced, obstructed or interfered with. \"It is a mode of vindicating the majesty of law, in its active manifesta- tion against obstruction and outrage.\" (, J. in v. U.S.) 348 US 11. The object and purpose of punishing contempt for interference with the administration of justice is not to safeguard or protect the dignity of the Judge or the Magistrate, but the purpose is to preserve the authority of the courts to ensure an ordered life in society. In v. , [1974] A.C. 273 at p. 302 the necessity for the law of contempt was summarised by Lord as: ", "\"In an ordered community courts are estab- lished for the pacific settlement of disputes and for the maintenance of law and order. In the general interests of the community it is imperative that the authority of the courts should not be imperilled and that recourse to them should not be subject to unjustifiable interference. When such unjustifiable inter- ference is suppressed it is not because those charged with the responsibilities of adminis- tering justice are concerned for their own dignity: it is because the very structure of ordered life is at risk if the recognised courts of the land are so flouted and their authority wanes and is supplanted.\" ", "The Chief Judicial Magistrate is head of the Magistracy in the District who administers justice to ensure, protect and safeguard the rights of citizens. The subordinate courts at the district level cater to the need of the masses in administering justice at the base level. By and large the majority of the people get their disputes adjudicated in subordinate courts, it is, in the general interest of the community that the authority of subordinate.courts is pro- tected. If the CJM is led into trap by unscrupulous Officers and if he is assaulted, handcuffed and roped, the public is bound to lose faith in courts, which would be destrictive of basic structure of an ordered society. If this is permitted shall be supplanted by Raj. Viewed in this perspective the incident is not a case of physical assault on an individual judicial officer, instead it is an onslaught on the institution of the judici- ary itself. The incident is a clear interference with the administration of justice, lowering its judicial authority. Its effect was not confined to one District or State, it had a tendency to affect the entire judiciary in the country. The incident highlights a dangerous trend that if the is annoyed with the orders of a presiding officer of a court, he would be arrested on flimsy manufactured charges, to humiliate him publicly as has been done in the instant case. The conduct of Officers in assaulting and humiliate the CJM brought the authority and administration of justice into disrespect, affecting the public confidence in the institution of justice. \"The summary power of punish- ment for contempt has been conferred on the courts to keep a blaze of glory around them, to deter people from attempting to render them contemptible in the eyes of the public. These powers are necessary to keep the course of justice free, as it is of great importance to society.\" ( on Contempt of Court). The power to punish contempt is vested in the Judges not for their personal protection only, but for the protec- tion of public justice, whose interest, requires that decen- cy and decorum is preserved in . Those who have to discharge duty in are protected by the law, and shielded in the discharge of their duties, any deliberate interference with the discharge of such duties either in court or outside the court by attacking the presiding officers of the court, would amount to criminal contempt and the courts must take serious cognizance of such conduct. ", "It takes us to the question against which of' the con- temners contempt is made out. On behalf of the petitioners it was urged that the Police Officers' conduct amounts to criminal contempt as their action lowered the authority of the Chief Judicial Magistrate and it further caused inter- ference with the administration of justice. Mr. , learned Attorney-General contended that all those who abetted and helped the Police Officers' in their conduct and design are also guilty of contempt of court. On behalf of the contemners it was urged that the incident which took place in the Police Station does not make out any contempt of court. The Chief Judicial Magistrate had consumed liquor and in druken state he went to the Police Station and slapped the Police Inspector, , thereby he committed offence under the Bombay Prohibition Act as well as under Section 332 , 504 and 506 of the Indian Penal Code. Criminal cases have been registered against , CJM and after investigation charge-sheets have been submitted to the court. In this context, it was urged that no action could be taken against the contemners as the facts in issue in the present proceedings are the same as involved in the criminal prosecutions pending against , CJM. The question raised on behalf of the contemners need not detain us long. Proceedings for contempt of court are different than those taken for the prosecution of a person for an offence under the criminal jurisdiction. Contempt proceedings are peculiar in nature although in certain aspects they are quasicriminal in nature but they do not form part of criminal jurisdiction of the court. Criminal prosecution pending against the CJM or against the contemners has no bearing on the contempt proceedings initiated by this Court as the present proceed- ings are not for the purpose of punishing the contemners for the offence of wrongful detention and assault on , Chief Judicial Magistrate, instead these proceedings have been taken to protect the interest of the public in the due administration of justice and to preserve the confidence of people in . We, accordingly, reject the contemner's objection. ", "We have already recorded findings that , Inspector, had preplanned the entire scheme, he deliberately invited to visit Station where he was forced to consume liquor and on his refusal he was assaulted, arrested, handcuffed and tied with rope S.R. , , Sub-Inspector, , Head Constable and , Constable, all took active part in this shameful episode with a view to malign and denigrade the CJM on accout of his judicial orders against the . We, therefore, hold S.R. , Inspec- tor, , Sub Inspector, Head Constable and , Constable guilty of contempt of court. , had been summoned by , Inspector, to the Station in advance for purposes of being witness to the Panchnama drawn up by describing drunken condition of , CJM. The document was false and deliberately prepared to make out a Case against , CJM. was in complicity with , he actively participated in the preparation of the document to malign and humiliate the CJM and to prepare a false case against him, he is also, therefore, guilty of contempt of court. ", "As regards , the then District Superintendent of Police, Kheda, we have already recorded findings that he was hand in glove with , Police Inspector. The circum- stances pointed out by the and as discussed earlier, show that though , had not personally participated in the shameful episode but his Conduct, act and omission establish his complicity in the incident. It is difficult to believe or imagine that a Police Inspector would arrest, humiliate, assault and handcuff a CJM and the Police Chief in the District would be indifferent, or a mute spectator. The circumstances unequivocally show that was acting under the protective cover of as he did not take any immediate action in the matter instead he created an alibi for himself by interpolating the entries in the register at the Government Rest House, Balasinor. In his report submitted to the Addl. Chief Secretary () on 27.9.1989, did not even remotely mention the hand- cuffing and roping of CJM. It is unfortunate that as the district Superintendent of Police did not discharge his duty like a responsible Police Officer instead he identi- fied himself with , Police Inspector and actively abetted the commission of onslaught on the CJM. We, accord- ingly, hold , the then guilty of contempt of court. ", "995 ", "This takes us to the petition filed by for quashing the criminal cases initiated against him on the basis of two First Information Reports made by In- spector . As noticed earlier , Inspector, had registered two FIRs on 25.9.1989 against for the offences under Section 85(1)(3) read with Section 66(1)(b) and also under Section 110 of Bombay Prohi- bition Act on the allegations that had consumed liquor without permit or pass and under the influence of alcohol entered into 's chamber and behaved in an indecent manner. The FIR further alleged that caught hold of Inspector and slapped him. The second FIR was lodged by against for offences under Sections 332 , 353 , 186 and 506 of the Indian Penal Code on the same allegations as contained in the earlier FIR. During the pendency of the contempt proceedings before this Court, the continued the investigation and submitted charge sheet in both the cases against and at present Criminal Cases Nos. 1998/90 and 1999/90 are pending in , . These proceed- ings are sought to be quashed. ", "On behalf of the and the Officers, it was urged that since charge sheets have already been submitted to the , will have full opportunity to defend himself before the court where witnesses would be examined and cross-examined, therefore, this should not inter- fere with the proceedings. The gravamen of the charge in the two cases registered against N.L. is that he had consumed liquor without a pass or permit and under the influence of liquor, he entered the chamber of In- spector at the Station and assaulted him. The over-powered and arrested him and a panchnama was prepared and he was taken to medical exami- nation, and the report of medical examination indicates that he had consumed liquor. These very facts have been inquired into by the er and found to be false. We have recorded findings that Inspector and other Officers manipulated records and manufactured the case against N.L. with a view to humiliate and teach him a lesson as the was annoyed with his judicial orders. We have already recorded findings holding S.R. , Inspector, , Sub-Inspector, , Head-Constable, , Constable, , , and , D.S.P. guilty of con- tempt of court. These very persons are specified as witness- es in the two charge sheets. The 's as well as our findings clearly demonstrate that the allegations contained in the two FIRs are false. If is permitted to prose- cute on those allegations merely on the basis that charge sheets have been submitted by it, it would amount to gross abuse of the process of the . In the circumstances, proceedings against N.L. are liable to be quashed. ", "Learned counsel, appearing on behalf of the State of Gujarat and the Police Officers, urged that in the present proceedings this has no jurisdiction or power to quash the criminal proceedings pending against , CJM. Elaborating his contention, learned counsel submitted that once a criminal case is registered against a person the law requires that the court should allow the case to proceed to its' normal conclusion and there should be no interference with the process of trial. He further urged that this has no power to quash a trial pending before the criminal court either under the Code of Criminal Procedure or under the Constitution, therefore, the criminal proceedings pend- ing against should be permitted to continue. Learned Attorney-General submitted that since this has taken cognizance of the contempt matter arising out of the inci- dent which is the subject matter of trial before the crimi- nal court, this has ample power under Article 142 of the Constitution to pass any order necessary to do justice and to prevent abuse of process of the court. The learned Attorney-General elaborated that there is no limitation on the power of this under Article 142 in quashing a criminal proceeding pending before a subordinate court. Before we proceed to consider the width and amplitude of this 's power under Article 142 of the Constitution it is necessary to remind ourselves that though there is no provision like Section 482 of the Criminal Procedure Code conferring express power on this to quash or set aside any criminal proceedings pending before a criminal court to prevent abuse of process of the court, but this has power to quash any such proceedings in exercise of its plenary and residuary power under Article 136 of the Consti- tution, if on the admitted facts no charge is made out against the accused or if the proceedings are initiated on concocted facts, or if the proceedings are initiated for oblique purposes. Once this is satisfied that the criminal proceedings amount to abuse of process of court it would quash such proceedings to ensure justice. ., 3 SCR 121 this quashed First Information Report and issued direction prohibiting investigation into the allegations contained in the FIR as the was satisfied that on admitted facts no offence was made out against the persons named in the FIR. ., 1 SCC 692 criminal proceedings were quashed as this Was satis- fied that the case was founded on false facts, and the proceedings for trial had been initiated for oblique purposes. Article 142(1) of the Constitution provides that Supreme in exercise of its jurisdiction may pass such decree or make such order as is necessary for doing complete jus- tice in any 'cause' or 'matter' pending before it. The expression 'cause' or 'matter' would include any proceeding pending in court and it would cover almost every kind of proceeding in court including civil or criminal. The inher- ent power of this under Article 142 coupled with the plenary and residuary powers under Article 32 and 136 em- braces power to quash criminal proceedings pending before any court to do complete justice in the matter before this . If the court is satisfied that the proceeding in a criminal case are being utilised for oblique purposes or if the same are continued on manufactured and false evidence or if.no case is made out on the admitted facts, it would be in the ends of justice to set aside or quash the criminal proceedings. It is idle to suggest that in such a situation this should be a helpless spectator. ", "Mr. urged that Article 142(1) does not contem- plate any order contrary to Statutory provisions. He placed reliance on the 's observations in . U.P. Allahabad, Supp. 1 SCR 885 at 899 and, . 2 SCC 602 where the observed that though the powers con- ferred on this under Article 142(1) are very wide, but in exercise of that power the' court cannot make any order plainly inconsistent with the express statutory provisions of substantive law. It may be noticed that in and 's case () observations with regard to the extent of this 's power under Article 142(1) were made in the context of fundamental rights. Those obser- vations have no bearing on the question in issue as there is no provision in any substantive law restricting this 's power to quash proceedings pending before subordinate court. This 's power under Article 142(1) to do \"complete justice\" is entirely of different level and of a different quality. Any prohibition or restriction contained in ordi- nary laws cannot act as a limitation on the constitutional power of this . Once this has seisin of a cause or matter before it, it has power to issue any order or direction to do \"complete justice\" in the matter. This constitutional power of the Apex cannot be limited or restricted by provisions contained in statutory law. In v. , 3 SCR 235 at 243 the observed: ", "\"Very wide powers have been conferred on this for due and proper administration of justice. Apart from the jurisdiction and powers con- ferred on this under Articles 32 and 136 of the Constitution I am of the opinion that this retains and must retain, an inher- ent power and jurisdiction for dealing with any extra-ordinary situation in the largest interests of administration of justice and for preventing manifest injustice being done. This power must necessarily be sparingly used only in exceptional circumstances for furthering the ends of justice.\" ", "No enactment made by can limit or restrict the power of this under Article 142 of the Constitution, though while exercising power under Article 142 of the Constitution, the must take into considera- tion the statutory provisions regulating the matter in dispute. What would be the need of \"complete justice\" in a cause or matter would depend upon the facts and circum- stances of each case and while exercising that power the would take into consideration the express provisions of a substantive statute. Once this has taken seisin of a case, cause or matter, it has power to pass any order or issue direction as may be necessary to do complete jus- tice in the matter. This has been the consistent view of this as would appear from the decisions of this in . 3 SCR 1005; , 1 SCC 75; , 4 SCC 387; B.N. Nagara- jan & Ors. v. State of Mysore & Ors., 3 SCR 682: Special Reference No. I of 1964, (supra), and . (supra). Since the foundation of the criminal trial of is based on the facts which have already been found to be false, it would be in the ends of justice and also to do complete justice in the cause to quash the criminal proceedings. We accordingly quash the criminal proceedings pending before the Chief Judicial Magistrate, in Criminal Cases Nos. 1998/90 and 1999/ ", "90. The question arises what punishment should be awarded to the contemners found guilty of contempt. In determining the punishment, the degree and the extent of part played by each of the contemners has to be kept in mind. , Police Inspector who was the main actor in the entire incident and who had planned the entire episode with a view to humiliate the CJM in the publis eye is the main culprit, therefore, he deserves maximum punishment. , Sub-Inspector took active part in assaulting and tying the CJM at the behest of , Police Inspector. , Head Con- stable and , Constable also took active part in handcuffing and tying the CJM with ropes, but as subordinate officials they acted under the orders of his superior officer. , was friendly to , Police Inspector, he had no axe to grind against the CJM but he acted under the influence of , Police Inspector. So far as is concerned, he actively abetted the commission of on- slaught on the CJM. Having regard to the facts and circum- stances and individual part played by each of the aforesaid contemner we hold them guilty of contempt and award punish- ment as under: ", ", the then Inspector, Nadiad shall undergo simple imprisonment for a period of six months and he shall pay fine of Rs.2,000. , Sub-Inspector, Nadiad shall undergo simple imprisonment for a period of five months and will pay a fine of Rs.2000 and in default he will undergo one month's simple imprisonment. , Head Constable and , Constable, both are convicted and awarded simple imprisonment for a period of two months and a fine of Rs.500 each, in default they would undergo simple imprisonment for a further period of 15 days. , Mamlatdar is convicted and awarded two month's simple imprisonment and a fine of Rs. 1000 and in default he would undergo one month's simple imprisonment. , the then District Superintendent of , Kheda, is convicted and sentenced to imprisonment for a period of one month and to pay a fine of Rs. 1000 and in default to undergo simple imprisonment for 15 days. So far as other respondents against whom notices of contempt have been issued by the , there is no adequate material on record to hold them guilty of contempt of court, we accord- ingly discharge the notices issued to them. Before we proceed further, we would like to express the 's displeasure on the conduct of , the then Director General of , Gujarat. As the head of the in the State he was expected to intervene in the matter and to ensure effective action against the erring Officers. We are constrained to observe that he was totally indifferent to the news that a CJM was arrested, handcuffed, roped and assaulted. He took this news as a routine matter without taking any steps to ascertain the correct facts or effective action against the erring Officers. If the head of the administration in the State exhibits such indifference to a sensitive matter which shook the entire judicial machinery in the State, nothing better could be expected from his subordinate officers. did not act like a responsible officer. should take action against him departmentaly on the basis of the findings recorded by the . has initiated proceedings against other erring officers in respect of whom the has adversely commented, we would make it clear that discharge of contempt notices does not absolve those officers of their misconduct, is directed to proceed with the disciplinary proceedings for taking appropriate action against them. We are constrained to observe that did not immediately take effective steps against the erring officials. In spite of the direction issued by this the erring Officers were neither arrested nor placed under suspension. It was only after this took serious view of the matter and directed to suspend the erring Officers and arrest them, moved in the matter. The apathy of in taking effective action against the erring Officers leads to an impression that in the State of Gujarat, appears to have upper-hand, as the administration was hesitant in taking action against the erring Officers. If this practice and tendency is allowed to grow it would result in serious erosion of the Rule of Law in the State. We hope and trust that will take effective measures to avoid re-occur- rence of any such instance. should further take immediate steps for the review and revision of the Regulations in the light of findings recorded by the . ", "The facts of the instant case demonstrate that a presid- ing officer of a court may be arrested and humiliated on flimsy and manufactured charges which could affect the administration of justice. In order to avoid any such situa- tion in future, we consider it necessary to lay down guide- lines which should be followed in the case of arrest and detention of a Judicial Officer. No person whatever his rank, or designation may be, is, above law and he must face the penal consequences of infraction of criminal law. A Magistrate, Judge or any other Judicial Officer is liable to criminal prosecution for an offence like any other citizen but in view of the paramount necessity of preserving the independence of judiciary and at the same time ensuring that infractions of law are properly investigated, we think that the following guidelines should be followed. ", "(A) If a judicial officer is to be arrested for some offence, it should be done under intimation to the District Judge or as the case may be. ", "1001 ", "(B) If facts and circumstances necessitate the immediate arrest of a judicial officer of the subordinate judiciary, a technical or formal arrest may be effected. ", "(C) The facts of such arrest should be immedi- ately communicated to the District and Ses- sions Judge of the concerned District and the Chief Justice of . ", "(D) The Judicial Officer so arrested shall not be taken to a police station, without the prior order or directions of the District & Sessions Judge of the concerned District, if available. ", "(E) Immediate facilities shall be provided to the Judicial Officer to communication with his family members, legal advisers and Judicial Officers, including the . ", "(F) No statement of a Judicial Officer who is under arrest be recorded nor any panchnama be drawn up nor any medical tests be conducted except in the presence of the Legal Adviser of the Judicial Officer concerned or of equal or higher rank, it' available. ", "(G) There should be no handcuffing of a Judi- cial Officer. If, however, violent resistance to arrest is offered or there is imminent need to effect physical arrest in order to avert danger to life and limb, the person resisting arrest may be over-powered and' handcuffed. In such case, immediate report shall be made to the District & Sessions Judge concerned and also to the Chief Justice of . ", "But the burden would be on the Police to establish necessity for effecting physical arrest and handcuffing the Judicial Officer and if it be established that the physical arrest and handcuffing of the Judicial Officer was unjustified, the Police Officers causing or responsible for such arrest and handcuffing would be guilty of misconduct and would also be personally liable for compensation and/or damages as may be summarily determined by . ", "The above guidelines are not exhaustive but these are minimum safeguards which must be observed in case of arrest of a judicial officer. These guidelines should be implement- ed by the State Government as well as by the High Courts. We, accordingly, direct that a copy of the guidelines shall be forwarded to the Chief Secretaries of all the State Governments and to all the High Courts with a direction that the same may be brought to the notice of the concerned officers for compliance. ", "We do not approve conduct in visiting the Police Station on the invitation of Police Inspector . In our opinion, no Judicial Officer should visit a Police Station on his own except in connection with his official and judicial duties and functions. If it is necessary for a Judicial Officer or a Subordinate Judicial Officer to visit the Police Station in connection with his official duties, he must do so with prior intimation of his visit to the . ", "Pursuant to this 's appeal made on September 29, 1989, the members of the as well as the members of the throughout the country refrained from going on strike as a result of which inconvenience to general public was avoided and the administration of justice continued. The is beholden to the members of the and members of the for their response to this 's appeal. We record our appreciation of the able assistance rendered to the by the learned counsel for the par- ties. We are beholden to Sri , the then Attorney-General, who at our request ably assisted the in resolving complex questions of law. ", "The Writ Petitions, Contempt Petitions and Criminal Miscellaneous Petitions are disposed of accordingly. ", " disposed of."], "relevant_candidates": ["0000158396", "0000162242", "0000178093", "0000225133", "0000452710", "0000480602", "0000539740", "0000640995", "0000762605", "0000832781", "0000841465", "0000846920", "0000853252", "0000937486", "0000994171", "0001089401", "0001118349", "0001353689", "0001549616", "0001738333", "0001926500", "0001945293"]} {"id": "0001514279", "text": [", J. ", "1. For the assessment years 1965-66, 1966-67 and 1969-70, the petitioner submitted returns of income of Rs. 31,291, 20,649 and 1,004 respectively. The pelitioner's income for those years was assessed by the Income-tax Officer at Rs. 44,040; 23,040 and 1,250 respectively. In the balance sheets submitted along with the returns amounts of Rs. 51,735; 32,705 and 16,915 were shown as received on account of charity: The Income-tax Officer did not direct the addition of the amounts received on account of charity to the income returned by the petitioner. He did not question the correctness of the figures either. While so, on 28-3-74. the Income-tax Officer issued three notices under Section 148 of the Income-tax Act, 1961, alleging that he had reasons to believe that the income chargeable to tax for the three assessment years in question had escaped assessment within the meaning of section 147 of the Income-tax Act, and. requiring the petitioner to submit returns of income within thirty days of the service of notices as he proposed to reassess the income for the said assessment years. These notices were served on the petitioner on 2-4-74. The petitioner objected to the validity of the notices and demanded the disclosure of the reasons on which the Income-tax Officer grounded his belief thai income chargeable to tax had escaped assessment. The petitioner received no reply. The petitioner, therefore, filed C.W.P. Nos. 2808, 2809 and 2810 of 1975 impugning the validity of the notices as invalid and without jurisdiction. ", "2. The first submission of , learned counsel for the petitioner, was that the notices were bad as they were served beyond the period of limitation prescribed by section 149(1)(b) of the Income-tax Act. contended that the notices fell under sec-tion 147(b) and therefore the period of limitation was only four years. In the written statements filed by the the reasons recorded by the Income-tax Officer under section 148(2) are extracted. In regard to the assessment year 1969-70 the reasons for the other two years are identical the reasons are stated as follows:-- ", "\"During the year relevant to assessment year 1969-70 the assessee charged Rs. 16,914/- as charily along with other charges from the customers which is its income. The assessee has failed to disclose this amount in its return of income. I have reasons to believe that by reason of assessee's failure to disclose fully and truly the particulars of income to the extent of Rs. 16,914 has escaped assessment. Issue notice under section 148 read with section 147(a) for the assessment year 1969-70.\" ", "Though the statement of the reasons recorded by the Income-tax Officer refers to section 147(a) , it is clear from the allegations in the written statements that there was no failure or omission on the part of the assessee to disclose fully and kuly all the material facts necessary for his assessment for those years. In rela-tion to the assessment year 1969-70, it is said in the written statement. ", "\"So far as the item of charity is concerned it goes on accumulating with the petitioner-company to be disbursed from lime to time in charities to be selected by. the petitioner-company itself. The customer of the company from whom the aforesaid three headed remuneration is charged has no hand in nominating the charity to which the amount paid by him on account of charity is to go. Thus it is a case of application of the petitioner's income towards charity by the petitioner-company. In the year under consideration namely 1969-70 it appears from the assessment order dated 31st January 1970 passed by Income-tax Officer Companies that his attention was not drawn to the question of charity at all............ The original assessment for the assessment year 1969-70 was completed on 31st January, 1970 by Income Tax Officer. It is incorrect to say that the receipt and disbursement of the charity amount was accepted as correct by Income-tax Officer Companies . As already submitted above there was no mention of this item in the assessment order and apparently the attention of Ihe Income-tax Officer was not drawn to this at all.\" ", "Thus, it appears to be the case of the that at the time of the original assessment, the Income-tax Officer did not focus his attention on or apply his mind to the question whether the receipts by way of charity were to be treated as income or not and that later on the Income-tax Officer acquired the \"knowledge or instruction\" that the receipts by way of charity ought to have been included in the assessable income of the assessee. In other words, something which had not presented itself to the mind of the Income-tax Officer at the time of the original assessment came to be so presented to his mind after the completion of the assessment. Thus, though the statements of the reasons recorded by the Income-tax Officer refer to Section 147(a) , the cases really fall under section 147(b) and the period of limitation is only four years. ", "3. Of course, as was held in ., 101 ITR 477: (1976 Tax LR 197) (Cal), by ,, and 'a notice under section 147 which has been proposed under Clause (a) can be treated as one, if the material conditions are fulfilled, under Clause (b) of section 147 of the Income-tax Act of 1961'. In fact, Section 292B of the Income-tax Act, 1961, expressly provides that no return of income, assessment, notice, summons or other proceeding furnished or made or issued or taken or purported to have been furnished or made or issued or taken in pursuance of any of the provisions of the Act shall be invalid or shall be deemed to be invalid merely by reason of any mistake, defecl or omission in such return of income, assessment, notice, summons or other proceeding, if such return of income, assessment, notice, summons or other proceeding is in substance and effect in conformity with or according to the intent and purpose of the Act. Therefore, a notice under Section 148 though proposed under Section 147(b) if the conditions of Section 147(b) are otherwise substantially satisfied (sic). ", "4. Since Section 147(b) is the provision which is applicable to the cases, the limi-tation for the issuance of the notices in such cases is governed by Section 149(1)(b) which prescribes a period of four years from the end of the relevant assessment year. Therefore, for the assessment year 1965-66, the notice under Section 148 should have been issued on or before 31st March. 1970; for the year 1966-67, it should have been issued before 31st March, 1971, and for the assessment year 1969-70, it should have been issued before 31st March, 1974. The notices in respect of the assessment years 1965-66, and 1966-67 were clearly issued far beyond the period of limitation and they have, therefore to be quashed. C.W.P. Nos. 2808 and 2809 of 1975 are, therefore, allowed. ", "5. In regard (o the assessment year 1969-70, the submission of Shri was that it was not enough that the notice was sent by the Income-tax Officer before 31-3-1974; it was necessary lhat it should have been served on the assessee before 31-3-1974. He submitted lhat the word \"issued\" occurring in Section 149 meant \"served\". In support of his submission, he relied on the. decision of in , 53 ITR 100 ; (AIR 1964 SC 1742) and the decisions of the High Courls in v. J. P. Jani. 58 ITR 559: (AIR 1966 Guj 47). v. , (1974) 96 ITR 141 ( , 101 ITR 106 : (1975 Tax LR 811) ( & ), Commissioner of Income-tax v. , 105 ITR 479: (1977 Tax LR 68) (Andh Pra). Inasmuch as of Gujarat, ab and yana and Andhra Pradesh have merely purported to follow the decision of in case, it is necessary to consider the facts and ratio of that case in some detail. ", "6. case (AIR 1964 SC 1742), arose under the provisions of the 1922 Act and as we shall presently point uut, there is a vital difference between the provisions of the 1922 Act and the provisions of 1961 Act. For the assessment year 1947-48, the assessee in case had filed a return of her income and the assessment was completed some time in 1948. On 2-4-1956, the Income-tax Officer served on her a notice dated 19-3-1956 under Section 34(1) of the Indian Income-tax Act, 1922. The date of the notice was within 8 years from the end of the relevant assessment year, i.e., 31-3-1948, but it was served beyond eight years from that date. Section 34(1) , as it stood at that time, provided that a notice falling under Clause (a) had to be served on the assessee within eight years of the end of assessment year. The notice was clearly out of time as it was served beyond eight years from 31-3-1948. The situation in such cases was sought to be saved by Section 4 of the Amending Act (Act No. 1) of 1959 which provided that no notice issued under Section 34(1) (a) at any lime before the commencement of the Amending Act and no proceeding taken in consequence of such notice shall be called in question merely on the ground lhat at the time the notice was issued, the time within which such notice should have been issued had expired. The argument on behalf of the assessee in that case was that Section 4 of the Amending Act only saved a notice issued after the prescribed time but that it did not apply to a situation where the notice was issued within the prescribed time but not served within time. The meaning of ihe word \"issued\" in Section 4 of the Amending Act thus fell to be considered by . ", " noticed that Section 4 of the Amending Act was enacted for the sole purpose of saving the validity of notices such as those issued in the case before them and that if the construction sought to be placed by the assessee was to be accepted, it would defeat the purpose of the amendment. They noticed that while Section 34(1) (a) prescribed eight years for the service of notices, there was no provision prescribing a time-limit for Ihe issuance of notices. They further noticed that according to the dictionaries and in legislative practice the expression \"issued\" had a narrow as well as a wide meaning and that in its wider connotation it meant \"served\" also. They held that the expression \"issued\" occurring in Section 4 of the Amending Act was used in its wider connotation and meant \"served\". They observed that such a construction alone would effecluate the intention of the legislature. said :-- ", "\"The crucial word in the said section is \"issued\". The section says that though a notice was issued beyond the lime within which such notice should have been issued, its validity could not be questioned, if the word \"issued\" means \"sent\", we find (hat there is no provision in the Act prescribing a time-limit for sending a notice, for, under Section 34(1) (a) of the Act. a notice could be served only within 8. years from the relevant assessment year. It does not provide any period for sending of the notice. Obviously, therefore, the expression \"issued\" is not used in the narrow sense of \"sent\". ", " then proceeded to observe that the expresssion \"issued\" occurring in Ihe proviso to Section 23(3) had previously been equated with (he expression \"served\" occurring in the substantive pari of Section 34(1) by judicial interpretation. They referred to the observations of in , (1957-31 ITR 683 (Bom) ), in that connection. They then referred to the General Clauses Acf. the Calcutta Municipal Act and held that the expression \"issued\" had both a limited and a wide meaning and that it was for the to give a proper meaning to ihe expression according to the context of the Act. They said :-- ", "\"In the legislative practice of our country the said two expressions are sometimes used to convey the same idea. In other words, the expression \"issued\" is used in a limited as well as in a wider sense. We must, therefore, give the expression \"issued\" in Section 4 of Ihe Amending Act that meaning which carries out the intention of the legislature in preference to that which defeats it. By doing so we will not be departing from the accepted meaning of the expression, but only giving it one of its meaning accept-ed. which fits into the context or selling in which it appears.\" ", " then proceeded to give a closer look to the provisions of Section 4 of the Amending Act and finally observed:-- ", "\"Under Section 34(1) of the Act, as we have already pointed out, the time prescribed was only for service of the notice. As the notice mentioned in Section 4 of the Amending Act is linked with the time prescribed under the Act, the section becomes unworkable if the narrow meaning is given to the expression \"issued\". On the other hand, if we give a wider meaning to the word, the section would be consistent with the provisions of S, 34(1) of the Act. Moreover, the narrow meaning would introduce anomalies in the section: while the notice, assessment or reassessment were saved, the intermediate stage of service would ba avoided. To put it in other words, if the proceedings were only at the stage of issue of notice, the notice could not be questioned, but if it was served, it could be questioned: though it was served beyond time, if the assessment was completed, its validity could not be questioned. The result would be that the validity of an assessment proceeding would depend upon the stage at which the assessee seeks to question it. That could not have been the intention of the legislature. All these anomalies would disappear if the expression was given the wider meaning. ", "TO summarize: The clear intention of the legislature is to save the validity of Ihe notice as well as the assessment from an attack on the ground that the notice was given beyond the prescribed period, That intention would be effectuated if the wider meaning is given to the expression \"issued\". The dictionary meaning of the expression \"issued\" takes in the entire process of sending the notice as well as the service thereof. The said word used in Section 34(1) of the Act itself was interpreted by courts to mean \"served\". The limited meaning, namely, \"sent\" will exclude from the operation of the provision a class of cases and introduce anomalies. In the circumstances by interpretation, we accept the wider meaning the word \"issued\" bears. In this view, though the notices were served beyond the prescribed time, they were saved under S, 4 of Ihe Amending Act.\" ", "7. The decision of In case, (AIR 1964 SC 1742), therefore was that the expression \"issued\" had a wide as well as a narrow meaning and that in the context of Section 34 (1) which provided for service of notices within a period of eight years and in the context of the object of the Amending Act , the expression \"issued\" could only be given a wider meaning in Section 4 of Ihe Amending Act. did not lay down that Ihe expression \"issued\"' whenever and wherever it occurred in the Income-tax Act , carried the wider meaning. ", "8. Now let Us examine the provisions of the Income-lax Acl, 1961, along-side the corresponding provisions of 1922 Act, Sections 147, 148 and 149 of Ihe 1961 Act which correspond to Section 34(1) of the 1922 Act provide the machinery for assessment or re-assessment if it is found by the Income-tax Officer thai income chargeable to tax has escaped assessment. The expression 'income chargeable to tax which has escaped assessment' is deemed to include income chargeable to tax which has been under-assessed, income which has been assessed at too low a rate, income which has been made subject to excessive relief under the 1961 Act or the 1922 Act and income assessed after excessive computation of loss or depreciation allowance. Section 147 (a) & (b) of 1961 Act which corresponds lo Section 34 (1) (a) and (b) of the 1922 Act prescribes the conditions to be fulfilled before assessment or re-assessment can be made. Under Section 147(a) , the Income-tax Officer must have reason to believe that income chargeable to tax has escaped assessment for any assessment year by reason of the omission or failure on the part of the assessee to make a return of his income or to disclose fully and truly all material facts necessary for assessment for that year. Under Section 147 (b), the Income-tax Officer must have reason to believe, in consequence of information in his possession, that income chargeable to tax has escaped assessment. ", "Section 147(1) prescribes a condition precedent before any action is taken under Section 147 . It prescribes that the Income-tax Officer shall serve a notice on the assessee containing all or any of the requirements which may be included in a notice under Section 139(2) . Section 148(2) further prescribes that before the issuance of a notice under Section 148(1) , the Income-tax Officer shall record his reasons for doing so. It is important to notice at this juncture that neither Section 147 nor Section 148 prescribe any time-limit for the service of notice. This has to be contrasted with Section 34(1) which prescribed that in cases falling under Clause (a) the notice had to be served within eight years and in cases falling under Clause (b), the notice had to be served within four years of the end of the assessment year. Section 149 of the 1961 Act stipulates that no notice under Section 148 shall be issued after the expiry of eight years from the end of the assessment year in cases falling under Section 147(a) and after the expiry of four years from the end of the assessment year in cases falling under Section 147(b) . It ig to be noticed at once that while Section 148 prescribes that notice shall be served, Section 149 prescribes that a notice shall be issued. The limitation prescribed under Section 149 is for the issuance of the notice which is required to be served I under Section 148 before action is taken under Section 147 . The contrast between the provisions of Ihe 1961 Act and the 1922 Act becomes immediately patent. While section 34(1) of the Indian Income-tax Act 1922, prescribed limitation for the service of the notice on the assessee, Section 149 now prescribes limitation for the issuance of the notice. ", "It was because, in the scheme of the 1922 Act, limitation was prescribed for the service of the notice that had to hold in case, (AIR 1964 SC 1742), that the expression \"issued\" in Section 4 of the Amending Act meant \"served\". In the scheme of Ihe 1961 Act, limitation is prescribed with reference to the issuance of the notice. The scheme of the Act is that an Income-lax Officer must first have reason to be^ lieve that income chargeable to tax has escaped assessment either by reason of the omission or failure on the part of the assessee to make a return or to disclose fully and truly all material facts or in consequence of information in his possession. He is then required to record his reasons. He is then required to issue the notice prescribed by Section 148 within the period prescribed in Section 149 . This notice must be served before the Income-tax Officer can proceed to make the assessment or re-assessment under S, 147. That is the scheme of the present Ac! and there is no reason why the expression \"issued\" occurring in Section 149 should not be given its natural meaning instead of the strained, wider meaning \"served\". The departure from the old provision in Section 34 of the 1922 Act is a conscious departure and it is our duty to give full effect to it. ", "9. We do not think that it is necessary to discuss the decisions in v. J. P. Jani, 58 ITR 559 : (AIR 1966 Guj 47), v. Upa-dhyaya, (1974) 96 ITR 141 ( , 101 ITR 106: (1975 Tax tiR 811 (Punj)) and Commissioner of Income-tax v. , 105 ITR 479: (1977 Tax LR 68 (Andh Pra)) since the learned Judges who decided those cases merely purported to follow the decision of in , (AIR 1964 SC 1742). We have given our reasons for holding that did not decide in case that the expression \"issued\" wherever and whenever it occurred should always be given the wider meaning \"served\". gave the meaning \"served\" to the expression \"issued\" occurring in Section 4 of the Amending Act having regard to the context of the provision and the object of the Amending Act . We are clearly of the opinion that in the context of the provisions of the Income-tax Act , 1961, the expression \"issued\" occurring in Section 149 cannot be given the meaning \"served\". We dissent from the view-s expressed by the Gujarat and Andhra Pradesh and we overrule the decision of the Punjab and Haryana in case. ", "10. The learned counsel for the petitioner urged that the Income-tax Officer had no reason to believe, in consequence of any information in his possession, that any income had escaped assessment. He urged that the assessee had disclosed the receipts on account of charity in the balance-sheet submitted by him along with the return. According to him, it was a case of mere change of opinion by the Income-tax Officer. On the other hand, , learned counsel for the , invited our attention to case, 102 ITR 287: (1976 Tax LR 123) (SC), and urged that the information contemplated by Section 147(b) may be obtained even from the record of the original assessment, from an investigation of the material on record or the facts disclosed thereby or from other enquiry or research into facts or law and that cases where 'income liable to tax has escaped assessment due to oversight, inadvertence or mistake committed by the Income-tax Officer' may also be brought under Section 147(b) . We do not, however, propose to go into this question having regard to another formidable objection raised by that under the amended provisions of Article 226 of the Constitution we are precluded from going into these questions if any other remedy is provided by or under any other law for the time being in force argued that the assessee was entitled to raise the question of non-existence of reasons for belief before the assessing authority, the Appellate Assistant Commissioner and . In the famous case of , 41 ITR 191: (AIR 1961 SC 372), recognised the existence of alternative remedy under the provisions of the Indian Income-tax Act when it observed :-- ", "\"Mr. mentioned more than once the fact that the company would have sufficient opportunity to raise this question viz. whether the Income-tax Officer had reason to believe that under-assessment had resulted from non-disclosure of material facts, before the Income-tax Officer himself in the assessment proceedings and, if unsuccessful there, before the Appellate Officer or or in under Section 66 (2) of the Indian Income-tax Act . The existence of such alternative remedy is not however always a sufficient reason for refusing a party quick relief by a writ or order prohibiting an authority acting Without jurisdiction from continuing such action.\" ", "While previously had the freedom to issue a high prerogative writ notwithstanding the existence of an alternative remedy, it is now precluded from doing so because Article 226(3) provides, \"no petition for redress of any injury referred to in Sub-clause (b) or Sub-clause (c) of Clause (1) shall be entertained if any other remedy for such redress is provided for by or under any other law for the time being in force,\" C.W.P. 2810 of 1975 is, therefore, dismissed, but in the circumstances without costs."], "relevant_candidates": ["0000590022", "0000835552", "0001248156", "0001300646", "0001709407"]} {"id": "0001602127", "text": ["JUDGMENT Sen, J. ", "1. This is an appeal under Section 39(1)(vi) of the Arbitration Act, 1940, preferred by M/s. Dilip Construction Co. from an order of the District Judge, at Rajnandgaon, setting aside an award of the umpire in its favour, directing the payment of a sum of Rs. 8,65,000/- by ", "2. The material facts, shortly stated, are these. By a contract dated 26th February, 1960, the appellant was employed by the respondent for winning and raising 45,00,000 Cft. of BF grade lime-stone ore from its , and for transporting and loading the same into wagons at the railway siding of the mines. The deed of contract contained an arbitration clause, and it reads thus: ", "\"61. If at any time any question, dispute or difference whatsoever shall arise between the Employer and the Contractor upon or in relation to or in connection with the contract either party forthwith give to the other notice in writing of the existence of such question, dispute or difference and the sama shall be referred to the arbitration of two persons, one to be nominated by the Employer and the other by the Contractor or failing agreement between these two to an appointed by them. Such submission shall be deemed to be a submission to arbitration within the meaning of the Indian Arbitration Act , 1940 or any statutory modification thereof. The award of the Arbitrators or shall be final and binding upon the parties upon every or any such reference, the costs of and incidental to the reference and to the award respectively shall, subject to the condition that the amount of such costs to be awarded to either party shall not, in respect of a monetary claim exceed the percentage set out below of any such award, irrespective of the actual fees, costs and expenses incurred by either party, be in the discretion of the arbitrators or umpire who shall determine the amount thereof, as between party and party and direct by whom and to whom and in what manner the same shall be borne and paid. Work under the contract shall, if reasonably possible, continue during the arbitration proceedings, and no payments due or payable by the Employer shall be withheld on account of such proceedings. Provided, that in matter of claims where the amount involved does not exceed Rs. 25,000/- the decision of the Engineer shall be final and binding on the contractor and such items shall not be open to arbitration. ", "Except that no issues on which the final settlement is otherwise provided for in this contract shall be referred to .\" ", "3. The period stipulated in the contract for the completion of the work was of 12 months w.e. f. 29th December, 1959, but that period was extended from time to time upto 15th December, 1961. During the period in question, the appellant could perform the contract to the extent of 31,52,132.32 Cft. of lime stone, and received payments for the work done against running bills. Upon termination of the contract, the respondent prepared a final bill for Rupees 21,000/-. This was not accepted by the appellant and it instead submitted its own bill dated 5th May, 1965, raising a demand for payment of Rs. 16,77,197.28 P. That was followed by a letter dated 28th May, 1965, addressed by the appellant to the respondent, by which it requested a final settlement of accounts within 15 days. On 21st June, 1965, the appellant served the respondent with a lawyer's notice of submission to arbitration, stating that it had named one to be its arbitrator and requesting the respondent to nominate its arbitrator within 10 days, failing which the arbitrator named by it was to become the sole arbitrator and was to proceed with the reference. In response to the same, the respondent sent a reply dated 2nd July, 1965 to the following effect: ", "\"In the contract under reference between your clients and , Bhilai Plant, no dispute as contemplated under the Arbitration agreement has arisen, which would entitle your clients to refer the matter to arbitration. ", "This is specifically so, in view of the fact that your client's claims are under examination by and if in the course of finalisation of the claims any difference comes out, then only there will be any question of reference to arbitration. ", "It may also be mentioned that some of the claims mentioned by your client are even outside the purview of the agreement referred to by our clients. ", "Without prejudice to our above contentions, and reserving our right to take such action as may be deemed necessary in respect of the unmaintainability of the claims, We hereby nominate , Sr. D. G. M., as our arbitrator.\" ", "From the reply sent by the respondent it is quite clear that the existence of a dispute giving rise to arbitration was itself denied. However, as a matter of abundant caution, the respondent named its own arbitrator. In View of the threat in the notice sent by the appellant that in case of its failure to designate an arbitrator, the said was to become the sole arbitrator, that was done without prejudice to the objection already raised. ", "4. The arbitrators named by the parties appear to have entered upon the refer- ", "ence despite the protest of the respondent. They could not arrive at an agreement and appointed one to be the umpire. That is how the matter reached the umpire. By an award dated 10th April, 1967, the umpire directed the respondent to pay to the appellant a sum of Rs. 8,65,000/- in full and final settlement of its claim. On 1st May, 1967 the appellant presented an application under Section 14(2) of the Arbitration Act, for the filing of the award and to have the award made a rule of the . The learned District Judge directed the umpire to file the award. On the award being filed, the respondent made an application under Sections 30 and 33 of the Act for setting aside the award on the grounds that, the award had ignored the terms of the contract and was as such bad on the face of it; that not being based on evidence, it was a nullity and was, therefore, liable to be set aside in its entirety. ", "5. The most crucial question on which the decision of the appeal must turn and which, the learned District Judge did not deem it worthy of mention, is, whether there was a submission proper of a dispute to arbitration. The question is one which touches the jurisdiction of the arbitrators and the umpire, and it has been debated before us at great length. ", "6. In support of his contention that the award of the umpire is a nullity, learned counsel for the respondent relied upon Clause 61 of the agreement, and contends that on a plain construction of its terms, it is clear that the pre-existence of a difference or dispute is a condition precedent to the invoking of the arbitration clause. Consequently, the jurisdiction of the arbitrators and for the matter of that of the umpire to enter upon and adjudicate on a submission depends on the factual existence of such difference or dispute. In this case, there was no such difference or dispute. ", "7. In an endeavour to overcome the difficulty, the learned counsel for the appellant has advanced a three-fold argument. Firstly, he urges that no such objection having been taken earlier, the objection cannot be permitted to be raised for the first time at this stage in appeal. Secondly, the submission is that the respondent, having participated in the proceedings before the arbitrators and the umpire, with a clear knowledge of the circumstances on which it might have founded an objection to their proceeding to make an award; and thereby submitted to the arbitration going on, and allowed the arbitrators and the umpire to deal with the case as it stood before them, taking its chance of the decision being more or less favourable to itself, was now precluded by conduct from raising the objection to the validity of the award. In support of the contention, reliance is placed on Halsbury's Laws of England, 3rd Edn. Vol. 2., p. 37; v. , 1925 AC 619; ., AIR 1954 Cal 245; Arbn. Juniter General Insce. , AIR 1956 Cal 470; , AIR 1960 Punj 182 and ., AIR 1965 Cal 42. Lastly the learned counsel urges that the respondent having failed to pay in full and settlement of the bill submitted by the appellant, there existed a dispute on the date of submission. At any event, he contends, that the respondent having joined issue on various items of claim in its counter-statement of acts filed before the arbitrators, there came into existence a difference or dispute between the parties as to the claim and, therefore, the arbitrators and the umpire had jurisdiction to deal with the matter. These contentions are wholly unfounded, and must, in our opinion, be rejected. ", "8. There was no jurisdiction either in the arbitrators, or the umpire to make an award in this case. The pre-existence of a difference or dispute is a condition precedent to the invoking of the arbitration clause. On a plain construction of its terms, the right to arbitration under Clause 61 of the agreement only arises, if a difference or dispute exists, at the time when a notice of submission is served by a party seeking to enforce the arbitration clause. In the present case, there was, in fact, no such difference or dispute. If there is no dispute, there can consequently be no right to demand arbitration. The must, therefore, be satisfied that there was some real point of difference which had to be submitted to arbitration. ", "9. The law on the subject is lucidly stated in Russel on Arbitration, Seventeenth Edn. p. 28 : ", "\"To constitute a submission proper, there must be a difference. If there is no difference there is nothing for an arbitrator to arbitrate about, and in the case of an agreement to refer future disputes to arbitration, the arbitrator's jurisdiction does not arise until a dispute has arisen. It might seem, therefore, that if the agreement between the parties is in effect an agreement to prevent disputes from arising and not an agreement as to how they are to be settled, then it is neither an agreement to refer to arbitration nor a submission to arbitration, and it is not within the Act\" ", "10. The existence of a dispute is an essential condition for the jurisdiction of an arbitrator. If there is no dispute, there can be no right to demand arbitration at all. This was clearly laid down by , J., as he then was, in 46 Cal 534 = (AIR 1920 Cal 143). A point as to which there is no dispute cannot be referred to arbitration. Failure to pay does not necessarily constitute a difference or dispute. A dispute implies an assertion of right by one party and repudiation thereof by another. In the instant case, there was merely an assertion of a claim made by the appellant for payment of Rupees 16,77,197.28 P., but there was no repudiation of that claim by the respondent and, therefore there could be no dispute which could be referred to arbitration. The jurisdiction of an arbitrator depends not upon the existence of a claim or the accrual of a cause of action, but upon the existence of a dispute. ( , 24 Cal WN 775 = (AIR 1920 Cal 808 (2)). ", "11. The leading case on the subject is v. , 1899 AC 79 (HL). In that case, Section 5 of an Act of authorised the railway company to charge a reasonable sum, by way of addition to tonnage rate, for services rendered to a trader. The Act further provided that any differences between the parties arising under the said section was to be determined by an arbitrator to be appointed by . The Railway company, in pursuance of the power so conferred on it, had given four days' time to traders to unload their wagons, and, after the said period was over, the traders were required to pay 6d. a day as demurrage for each wagon. The defendant took more than four days to unload his wagons. He knew of these conditions but all along had protested against the right of the company to levy the said demurrage. The railway company sued the defendant in to recover a certain sum for such demurrage. The defence was that the suit could not go on, and that the company's claim could only be settled by an arbitrator to be appointed by . The finding of Judge was that no difference had arisen between the parties before the action had been commenced, either on the question as to whether the four free days were sufficient or not for unloading, or whether 6d. a day was a reasonable charge or not. The question before the was not whether the action was to be stayed or not. The question was of wider scope, namely, whether the action was maintainable or not. In the said case, reversed the decision of the of Appeal. Lord , L. C., stated: ", "\"A condition precedent to the invocation of the arbitrator on whatever grounds is that a difference between the parties should have arisen; and I think that must mean a difference of opinion before the action is launched, either by formal plaint in or by writ in the superior . Any contention that the parties could, when they are sued for the price of the services, raise then for the first time, the question whether or not the charges were reasonable and that therefore they have a right to go to an arbitrator, seems to me to be absolutely untenable.\" ", "Lord then drew an analogy from an arbitration out of Court. He said that before the arbitrator could enter upon the reference, it must be shown that a difference had arisen between the parties before the submission and, that the arbitrator would have jurisdiction only to adjudicate upon the particular difference which had arisen before the submission. If fresh differences arise after the arbitrator had entered upon the reference, the arbitrator cannot adjudicate upon them without a fresh submission. In the same case Lord made the following observations- \"One matter about which I do desire to say a word.........is this.........that this difference before action brought, and that it is too late.........afterwards to raise a difference which can be brought within the meaning of this section.\" The principle so formulated has been applied in India where the application was for stay or action under Section 34 of the Indian Arbitration Act. In Ladha Singh Bed! v. , ILR (1939) 2 Cal 181 = (AIR 1940 Cal 105) , J. dealing with this case pointed out as follows: ", "\"The noble Lord then drew an analogy from an arbitration out of Court. He said that before the arbitrator could enter upon the reference, it must be shown that a difference had arisen between the parties before the submission and that the arbitrator would have jurisdiction only to adjudicate upon the particular difference which had arisen before the submission.\" ", "The same view has been taken by , and , J. in v. , ILR (1950) 1 Cal 497. ", "12. The weight of authority is clearly in favour of the view that unless there is repudiation of a claim, there can be no dispute in respect thereof. , (1921) 33 Cal LJ 545 = (AIR 1921 Cal 342), the buyer wanted a variety of information from the sellers to enable him to judge whether the goods supplied were or Were not according to the contract. Amongst other things, he demanded production of shipment samples. The sellers declined to comply with the request. But there was at no stage an assertion by the buyer that the goods had not been supplied according to the contract and consequently there was not and could not be a repudiation by the sellers of any such assertion. It was held by and , JJ. that there was no \"dispute\" which could be and had been validly referred to arbitration. While repelling the contention similar to the one made before us, , J. stated: ", "\"It has been argued before us that this is an unduly narrow construction of the arbitration clause and that the terms 'difference' and 'defect' need not be restricted to 'difference' or 'defect' in. quantity or quality only. We are disposed to accede to this contention, but, even then, the appellant is not entitled to succeed, unless he proves that there was a dispute as to difference or a dispute as to defect. Now, a dispute implies an assertion of a right by one party and a repudiation thereof by another. In the case before us, the parties never reached that stage.\" ", " , AIR 1931 Bom 164 the plaintiff was the sub-partner of the defendant in a certain business. The deed of sub-partnership incor-ported all the articles, covenants, conditions and obligations contained in the principal partnership agreement between the defendant and his partner which were not inconsistent With the terms of the agreement. There was a clause in the deed of principal partnership which provided, inter alia, that any dispute or difference arising between partners with regard to the construction of any of the articles contained in the agreement or to any divisions of goods or things, related to the said Partnership or the affairs thereof, shall be referred to arbitration in the manner therein mentioned. The plaintiff called upon the defendant to make up the accounts and to pay him the amount found due at the foot thereof. The defendant did not pay and the plaintiff filed a suit praying that the defendant may be ordered to render a true and complete account of the profits earned by the partnership business and of the amount due to the plaintiff, and to pay the same to him. The defendant thereupon took out a summons for an order to stay further proceedings to enable the parties to refer to arbitration. It was held by , that as there was no dispute between the parties but mere failure to pay, the suit was maintainable and could not be stayed. The principles deducible from these authorities are- ", "(i) The existence of a difference or dispute is an essential condition for the arbitrator's jurisdiction to act under an arbitration clause in an agreement; ", "(ii) The jurisdiction of an arbitrator depends not upon the existence of a claim or the accrual of a cause of action, but upon the existence of a dispute. A dispute implies an assertion of a right by one party and repudiation thereof by another; ", "(iii) A failure to pay is not a difference, and the mere fact that a party could not or would not pay does not in itself amount to a dispute unless the party who chooses not to pay raises a point of controversy regarding, for instance, the basis of payment or the time or manner of payment. ", "13. There is no merit in the contention of learned counsel for the appellant that the respondent not having taken any objection as to the jurisdiction of the arbitrators or the umpire to enter upon the reference earlier, it cannot now be permitted to raise such an objection at this stage. Throughout, the respondent has taken the stand that there was no difference or dispute existing at the time of reference and, therefore, the arbitration clause could not be invoked. In the first place, such an objection was expressly taken not only at the initial stage as soon as the lawyer's notice was served, but also thereafter before the arbitrators and in the below. In its reply dated 2nd July, 1965, the respondent had clearly stated that \"no dispute as contemplated in the arbitration agreement has arisen\" as would entitle the appellant to refer the matter to arbitration. The respondent further stated that in view of the fact that the appellant's claim was \"under examination by \", and if in the course of finalization of the claim \"any difference comes out\" then only there will be any question of reference to arbitration. Thereafter, in para 18 of the counter-statement of facts filed before the arbitrators, the respondent reiterated that the the reference to arbitration was premature. Once again, in, the below, the respondent while applying under Section 30 of the Arbitration Act for setting aside the award, had specifically alleged in para 5 of the application that \"there was no dispute or difference as contemplated by Clause 61 of the agreement\" and that it had only nominated an arbitrator without prejudice to this contention, and in para 41 thereof stated that the arbitrators and the umpire had \"acted without jurisdiction.\" In the face of such clear and explicit assertions by the respondent, at all relevant stages, we fail to appreciate how it can be urged that no such objection was taken earlier and, therefore, the objection cannot be raised at this stage. ", "14. It is well established by authority that once the parties appearing before the arbitrators object to the jurisdiction, they do not waive their rights by proceeding with the case before the arbitrators and defending themselves as best as they may. The law is succinctly stated in Russel on Arbitration, 17th Edn. p. 174 thus : ", "\"In cases where an arbitrator enters into the consideration of matters which are not referred to him, or which he has no jurisdiction to try, 'the question is not one of waiver or estoppel, but of authority' and a party continuing to attend the reference after objection taken and protest made does not give the arbitrator authority to make an award.\" ", "\"If a party to a reference objects that the arbitrators are entering upon the consideration of a matter not referred to them and protests against it, and the arbitrators nevertheless go into the question and receive evidence on it, and the party, still under protest, continues to attend before the arbitrators and cross-examines the witnesses on the point objected to, he does not thereby waive his objection, nor is he estopped from saying that the arbitrators have exceeded their authority by awarding on the matter.\" ", "\"Continuing to take part in the proceedings after protest made does not amount to be a consent.\" ", "In particular, we would refer to the remarks of Lord , L. C., in v. , (1880) 6 QBD 63 where he said: ", "\"In arbitrations, where a protest is made against jurisdiction, the party protesting is not bound to retire; he may go through the whole case, subject to the protest he has made.\" ", "See also v. , (1864) 34 LJQB 8. The principles enunciated in these cases have throughout been followed in India. , AIR 1927 Bom 553; , AIR 1931 Bom 81; ., AIR 1931 Bom 343 and v. , (1961) 31 LJ Ch 420. Thus, the appearance of the respondent after objection taken and protest made did not give the arbitrators or the umpire authority to make an award, nor estopped it from urging that the umpire has exceeded his authority. In such a case, no question of estoppel, acquiescence or waiver, arises. ", "15. Learned counsel for the appellant relied upon the following passage in Halsbury's Laws of England, 3rd Edn. Vol. 2, p. 37: ", "\"84. Party protesting that arbitrator is exceeding his authority. ", "A party who protests that the arbitrator is acting either without authority or beyond the scope of the agreement of reference, but nevertheless attends the reference, does not thereby waive his protest.\" but we fail to understand how that passage supports him, ", "16. The decisions relied upon by learned counsel for the appellant are distinguishable on facts. They rest on the principle of estoppel, waiver or acquiescence. They rest on the principle that if a party allowed an arbitrator to proceed without objecting to his jurisdiction or competence, he would not be subsequently heard to say that the award should be set aside, on the ground that the arbitrator was not competent to decide the dispute in question. Though the learned counsel has not referred to the leading cases on the subject, we may advert to them. That principle was enunciated by in v. Mt. Bibi Bechunnissa, (1876) 3 Ind App 209 p. 220 in the following words : ", "\".........that the appellant, having a clear knowledge of the circumstances on which he might have founded an objection to the arbitrators proceedings to make their award, did submit to the arbitration going on, that he allowed the arbitrators to deal with the case as it stood before them, taking his chance of the decision being more or less favourable to himself; and that it is too late for him, after the award has been made, and on the application to file the award, to insist on his objection to the filing of the award.\" ", "Likewise, in and Co. v. , AIR 1920 PC 123 was faced with the question as to the defective appointment of a sole arbitrator. Their Lordships were of the opinion that though the defect, i. e., the absence of notice under Section 9(b) , would have been fatal to the authority of the person appointed as sole arbitrator but for the fact that any objection on this head was waived by the party concerned, he having rested his case as to the validity of any arbitration in the place in which it was held, he could not be permitted to rely on a defect in procedure which could have been remedied at once if he had raised the point. ", "17. We shall now deal with the decisions relied upon. In (1925) AC 619 held that the claimant having allowed the point of insurable interest to be raised before the arbitrator without objection, it was not open to him to call in question the authority of the arbitrator to entertain it. In AIR 1956 Cal 470 (supra), the submission to arbitration was by a party under a statutory disability, and in spite of the disability, it had participated in the arbitration without protest and fully availed of the arbitration proceedings and then when it saw that the award had gone against it, it came forward to challenge the whole of the arbitration proceedings as without jurisdiction on the ground of a known disability of a party. That was also a case where a party having knowledge of its disability had withheld that fact and was thereby precluded by conduct from challenging the validity of the award. In AIR 1965 Cal 42 (supra), there was failure to object to the jurisdiction of the arbitrators and the umpire as to investigate a part of the claim, i. e., with respect to the hiring charges, at any stage of the proceedings, and it was held that such failure acts as an estoppel. In AIR 1960 Punj 182 (supra), there was a valid submission, and no objection was taken to the Superintending Engineer, for the time being, adjudicating upon the dispute. The party willingly and without protest took part in the proceedings before the arbitrator, and thereby took its chance of the decision going in his favour. In those circumstances, it was held that there was implied variance of the agreement to refer to a named arbitrator, by conduct, and that it was under the varied agreement that the arbitrator acted. There was, accordingly, no defect in the award. ", "18. We are here not concerned with any procedural irregularities, but initial lack of jurisdiction. ., AIR 1962 SC 1810, has observed: ", "\"But what confers jurisdiction on the arbitrators to hear and decide a dispute is an arbitration agreement as defined in Section 2(a) of the Arbitration Act, and where there is no such agreement, there is an initial want of jurisdiction which cannot be cured by acquiescence. It may also be mentioned that the decision in (1860) 30 LJ Bcy 10 has been understood as an authority for the position that when one of the parties to the submission is under a disability that will not be a ground on which the other party can dispute the award if he was aware of it. Vide Russel on Arbitration, 16th Edition, 320\" ", "When the respondent was not willing to join in the submission, the remedy of the appellant lay by way of an application under Section 20 of the Arbitration Act. We are fortified in that view by the decision of in , AIR 1955 SC 468. While dealing with the question, their Lordships of observed: ", "\"A reference requires the assent of 'both' sides. If one side is not prepared to submit a given matter to arbitration when there is an agreement between them that it should be referred, then recourse must be had to the , under Section 20 of the Act and the recalcitrant party can then be compelled to submit the matter under Sub-section (4). ", "In the absence of either, agreement by 'both' sides about the terms of reference, or an order of the under Section 20(4) , compelling a reference, the arbitrator is not vested with the necessary exclusive jurisdiction.\" ", "19. It is now well settled that an inherent lack of jurisdiction or want of jurisdiction renders the ultimate decision a nullity so that it can be challenged at any subsequent stage and even in collateral proceedings. Such a defect cannot be cured even by waiver or acquiescence of the party entitled to raise the objection. ( , AIR 1954 SC 340). By now the expression \"jurisdiction\" has acquired a much wider meaning. However, the expression \"jurisdiction\" even in its original sense when it was limited, included within its ambit the stage of commencement of a proceeding. We are concerned in this case with jurisdiction at the commencement of the proceeding and, therefore, even in the original sense of the term, when it was so limited, such a defect of jurisdiction was a nullity. This theory has now been modified by enlarging the scope of the expression \"jurisdiction\" so as to include in its ambit even those defects which may crop up later during the course of the proceeding. This modified meaning enlarging the scope of the expression \"jurisdiction\" is dealt with in v. , (1969) 1 All ER 208 by , and the same has been followed with approval by their Lordships of in , = (AIR 1971 SC 1558). ", "20. In the state of law as it is, there can be no manner of doubt that the defect of jurisdiction with which we are concerned in the present case, is such that in case it exists, the ultimate award would be a nullity and, that being so, such an objection can be validly raised for the first time even at this stage. For these reasons, we are of the view that the objection taken on behalf of the appellant to the tenability of this argument has no force. ", "21. Having regard to the view that we have taken on the question of jurisdiction, there is no need for us to go into other questions. We are satisfied that the umpire had no jurisdiction to deal with the matter and, therefore, the award was rightly set aside. ", "22. The result, therefore, is that the appeal fails and is dismissed with costs. The order of the learned District Judge setting aside the award of the is affirmed, though of a different ground. Counsel's fee as per schedule or a certificate, whichever is less."], "relevant_candidates": ["0000318186", "0000535796", "0000578559", "0000775894", "0001039262", "0001348345", "0001506501", "0001625415", "0001703516", "0001773916", "0001986314"]} {"id": "0001627634", "text": [", Judicial Member ", "1. This appeal is directed against the order of the Commissioner (Appeals) dated 7-10-1982 passed in Appeal No. 18/111. D/CIT. II of 1982-83. The assessment year involved in this appeal is 1978-79. ", "2. According to the facts arising in this case, the firm filed the original return for the assessment year 1978-79 on 31-3-1979, admitting a net income of Rs. 4,16,289 from its business in purchase and sale of yarn, fibre, etc. Subsequently, on 1-11-1980, the firm filed a revised return showing an income of Rs. 2,46,450. The difference between the income disclosed in the original return and the one returned in the revised return is on account of the claim made under the head bad debts. The forwarded the draft order of assessment to the assessee on 29-10-1981, which was served on the assessee on the same date. On 8-12-1981, the forwarded the draft assessment order under Section 144B of the Income-tax Act, 1961 ('the Act'), along with the objections of the assessee-firm to the for further action. The gave instructions by his order under Section 144B on 21-4-1982. The same day, the completed the assessment. According to the Commissioner (Appeals), the completed the assessment within 180 days from 29-10-1981 and, therefore, it is within the time limit. ", "3. Before us, the learned Counsel appearing for the assessee submitted that the order of the assessment dated 21-4-1982 is without jurisdiction inasmuch as it is barred by time and, hence, according to the assessee, the assessment is ab initio void. The crux of the submission made by the learned Counsel was that the original return, which was filed on 31-3-1979, was filed neither under Section 139(1) nor under Section 139(2) of the Act, being beyond the time limits prescribed by the aforesaid sections. The return was one filed under Section 139(4) . Therefore, the revised return filed on 1-8-1980 is non est in law, because a revised return under Section 139(5) can be filed only to rectify mistakes, etc., in a return filed under Section 139(1) or Section 139(2) . If that is so, according to him, the assessment completed on 21-4-1982 is barred by time since, for the assessment year 1978-79, two years' period ended on 31-3-1981. ", "4. The learned counsel appearing for the assessee, in support of his argument, relied upon the decision of in the case of 136 ITR 559, wherein was of the view that: ", "Different time limits for completion of assessments have been provided in respect of cases where a return has been filed under Sub-section (4) or a revised return has been filed under Sub-section (5). Sub-section (5) does not provide for any separate category of return. It only gives a right to an assessee to revise a return already tiled under Sub-section (1) or Sub-section (2). When a revised return is filed the original return stands supplanted or withdrawn. If the original return is under Sub-section (1), and a revised return is filed, then the revised return would be a return under Sub-section (1) and so will be the position if the original return was under Sub-section (2). Therefore, a return under Sub-section (4) stands in a category different from that provided in Sub-section (1) or Sub-section (2) and such a return cannot be revised under Sub-section (5). The revised return, being an invalid return, cannot extend the period of limitation for completing the assessment. ", "5. Yet another decision, relied upon by the learned Counsel for the assessee, was that in [l978] 113 ITR 830 (All.) (FB). This judgment was then followed in Dr. 's case (supra). In Metal India Products case (supra), the Full Bench of the Allahabad High Court was of the view that where the assessee filed his return within the time prescribed by Section 139(1) and where no notice was issued by the ITO to the assessee under Section 139(2) , even if the assessee filed its return under Section 139(4) , within four years from the end of the assessment year and before the assessment order was passed, the assessee is liable to pay penalty under Section 271(1)(a) of the Act, for not having filed the return within the time prescribed in Section 139(1) or the time given under Section 139(2) . For the purposes of penalty, the filing of the return within the time prescribed by Sub-section (4) cannot be treated as a return filed within the time prescribed by Sub-section (1). ", "6. Reliance was also placed on the decision in 129 ITR 379 (Delhi). This judgment was also followed by in Dr. 's case (supra). In case (supra), was of the view that subsection (5) of section 139 applies only in a case where a person, having furnished a return under Sub-section (1) or Sub-section (2), discovered any omission or wrong statement therein. The sub-section does not refer to Sub-section (4) and, therefore, does not entitle an assessee to rectify or revise a return filed under Section 139(4) . Accordingly, held that the return filed on 30-3-1965, being one under Section 139(4) , a revised return could not be filed under Section 139(5) and the return filed on 28-3-1966 was invalid in law. ", "7. On the other hand, the learned departmental representative pointed out that the assessee can file any number of returns under Section 139(4) . Therefore, according to him, the second return filed on 1-11-1980 is not invalid in law, and if that is so, according to him, the assessment order passed on 21-4-1982 is not barred by limitation. He relied upon a judgment of in 137 ITR 722, wherein was of the view that: ", " The Income-tax Act contemplates the filing by the assessee of a correct and complete return. The law gives him a right to substitute and bring on record a correct and complete return if he discovers any omission or wrong statement in the return originally filed by him. The law cannot content plate the making of an assessment on the basis of a return which even the assessee claims contains wrong statements. When an assessee files a revised return, he, in fact, admits that the original return filed by him was not correct or complete and substitutes the same by a revised return which, according to him, is correct and complete. The effective return for the purposes of assessment is thus the return which is ultimately filed by an assessee on the basis of which he wants his income to be assessed. Sub-section (5) is a part of Section 139 . The statute itself provides for the filing of a revised return. Section 143 does not specifically deal with the return filed either under Sub-section (1) or Sub-section (2) or Sub-section (4) of Section 139 . It deals generally with the return filed under Section 139 . It is true that Sub-section (5) specifically mentions Sub-section (1) or Sub-section (2) but does not mention the case of a return filed under Sub-section (4) of Section 132 . However, the true purport of a return filed under Sub-section (5) is that it substitutes the original return filed and Sub-section (4) specifically gives the assessee a right to file a return at any time before the assessment. Hence, where a voluntary return has been filed under Section 139(4) , a revised return can be filed in respect of it. ", "While coming to the aforesaid conclusion, dissented from the view taken by in case (supra). ", "8. Yet another decision, relied upon by the learned departmental representative, was that of Mst. 129 ITR 560, wherein was of the view that if an assessee, after having filed a return under Section 139(4) , files another revised return subsequently, it is to be assumed that he has given a go-by to the return filed previously and that so far as he is concerned, the return filed subsequently is the correct and proper return. Where the ITO allows the revised return to be filed and proceeds to assess thereunder without any objection from the assessee, it would not be open to the assessee to contend later that the return filed subsequently was invalid. Therefore, held that the subsequent return filed by the assessee was a valid return under Section 139(4) and the assessment made thereunder was within the time prescribed under Section 153 of the Act. ", "9. Again, the learned departmental representative attempted to support his view by placing reliance on the judgment of in .) Ltd. 77 ITR 518. In that case, held by the majority judgment that Section 24(2) of the Indian Income-tax Act, 1922 ('the 1922 Act'), conferred benefit to the assessee, whereby losses incurred in a particular year could be set off and carried forward to a subsequent assessment year. There was no provision in Section 22 of the 1922 Act, under which losses had to be determined for the purpose of Section 24(2) . Section 22(2A) simply laid down that in order to obtain the benefit of Section 24(2) , the assessee must submit his return showing loss within the time specified by Section 22(1) . That provision, according to , had to be read with Section 22(3) . It was held that a return showing a loss submitted at any time before the assessment was made was valid, as it could be contended that Section 22(3) was merely a proviso to Section 22(1) . ", "10. Therefore, it was submitted that inasmuch as the assessee itself filed two returns, the was made to proceed on the second return wherein bad debt deduction was claimed. It was further submitted that the approach of any judicial authority must be to vest jurisdiction in the and not to divest the jurisdiction which was already vested. On the other hand, the learned Counsel appearing for the asses see, relying upon the decision of in . 88 ITR 192 contended that when there are two views possible on the same point, that which is in favour of the assessee should be followed. ", "11. We have heard the rival submissions. The original return was filed on 31-3-1979 and, subsequently, a revised return was filed on 1-11-1980. On 29-10-1981, draft assessment order was framed and on 21-4-1982, final order of assessment was passed. Section 139 particularly enables the filing of returns under Sub-section (1) suo moto within the statutory period provided under Sub-section (2), in response to a notice specifically issued as also under Sub-section (4), voluntarily. The issue before us is whether a return filed under Sub-section (4) could be considered to be a return filed under subsection (1) or Sub-section (2) of Section 139 , because only if the return filed under Sub-section (4) is so construed, the assessee would be entitled to file a revised return under Sub-section (5). The learned Counsel for the assessee had submitted that if two views are possible, as in the present case, then the view in favour of the assessee should be taken. This is not an instance where one of the two views will always be favourable to all the assessees. In view, if an assessee makes a return even beyond the time limit allowed under Section 139(1) , or Section 139(2) , and discovers a mistake therein, he should always file a revised return. This view enables an assessee to set right any mistake even in returns, which were originally filed belated. In view, such action is not possible. Merely because in the present case, if following view, the revised return is held to be non est, limitation would have set in, it does not follow that this is the view which has to be construed as favourable to the assessees in general. The rule of interpretation canvassed for by the learned Counsel, therefore, does not help us in deciding the present case. We have to decide the case in the light of the judgments of the various relied on by the parties. We have already set out the reasoning of in the case of (supra), which we repeat as under: ", "...Sub-section (5) is a part of Section 139 . The statute itself provides for the filing of a revised return. Section 143 does not specifically deal with the return filed either under Sub-section (1) or Sub-section (2) or subsection (4) of Section 139 . It deals generally with the return filed under Section 139 . It is true that Sub-section (5) specifically mentions subsection (1) or Sub-section (2) but does not mention the case of a return filed under Sub-section (4) of Section 139 . However, the, true purport of a return filed under Sub-section (5) is that it substitutes the original return filed and Sub-section (4) specifically gives the assessee a right to file a return at any time before the assessment. Hence, where a voluntary return has been filed under Section 139(4) , a revised return can be filed in respect of it. ", " has given reasons why even where a voluntary return has been filed under Section 139(4) , a revised return could yet be filed to set right mistakes. In the present case, the assessee had filed a return showing an income of as much as Rs. 4,16,000 but, later in the return filed on 1-11-1980, the income shown was only Rs. 2,46,000. The difference of Rs. 1,70,000 was an amount claimed as bad debts. In the view of , such action was clearly permissible. We have carefully considered the views expressed by the Delhi and the Allahabad , but we would respectfully follow the reasoning of and hold that merely because the first return filed on 31-3-1979 showing an income of Rs. 4,16,289 for the assessment year 1978-79 was a return under Section 139(4) , the assessee was not prevented from filing the revised return showing an income of Rs. 2,46,450 on 1-11-1980. That being so, the return filed on 1-11-1980 is not non est in law and the assessment as made is within the period of limitation. On this ground, the assessee, therefore, does not succeed. ", "12. Insofar as merit is concerned, the learned Counsel for the assessee reiterated the same arguments as were advanced before the authorities below. In fact, the has disallowed a sum of Rs. 1,69,840, being bad debts claimed in the business in purchase and sale of yarn. He observed that the amounts varying between Rs. 100 and Rs. 10,000 were being written off without any action being taken for recovery of the debts. Before the , it was submitted that the firm incurred heavy losses and the business had come to an end. According to the assessee, the amounts written off represented interest charged but not accepted by the debtors and in some cases, they represented the difference in rates. It was further submitted that the firm did not have funds even to file a suit against these parties. However, the refused to accept the contention put forward by the assessee. ", "13. In the original return filed by the assessee, there was no claim for deduction of bad debts. The original return declared an income of Rs. 4,16,289 and the had initiated penalty proceedings for nonpayment of tax under Section 140A of the Act and levied a penalty of Rs. 50,000 by his order dated 20-9-1980. Subsequent to this, the firm filed a revised return claiming bad debts of Rs. 1,13, 274 in the accounts for the period 1-10-1976 to 30-6-1977 and Rs. 56,567 in the accounts for the earlier period 1-7-1976 to 30-9-1976. The details of bad debts were furnished before the . It was represented before him that most of the amounts were less than Rs. 1,000 and in all those cases, either the party was disputing the charging of interest or was not traceable. The remarks made by the on some of the items are as under: ", "Amount Name and address Remarks Rs. 10,900 , Paid bank commission for Chirala hundi drawn on him for party not in existence. 6,969 , Guravapalam 3,380 , Chinna- Disputed amount. , Narsannapet 18,385 , , Disputed amount. Narsannapet 18,932 Rate difference debited not , Secunderabad agreeing to pay. 10,840 , Bangalore Your rate differences paid. 3,445 Waived interest. Ltd., Cheekur 5,623 Expired. 4,543 , Nerada Expired. 3,591 , Nerada Not available in his village do not know whereabouts. 9,715 The Andhra Co-operative Difference in accounts. Spg. , Guntakal 5,000 , Secunderabad Paid advance. Party not available. ", "The learned Commissioner (Appeals) pointed out that apart from the verbal observations of the assessee-firm, there is no other evidence to indicate that the debts had become bad. He has also pointed out that large amounts running to Rs. 80,000 and odd were written off without any effort being made for recovery. However, under these circumstances, he considered that amounts of less than Rs, 1,000 should be treated as bad and benefit should be given to the assessee on these amounts. The disallowance was restricted to amounts in excess of Rs. 1,000. Accordingly, he gave relief of Rs. 22,128 and confirmed the balance. ", "14. However, on a scrutiny of the items, as set out by the , we found that two of the parties appear to have expired. They are V. Laxmaiah, Ramanpet and , Nerada. In the circumstances under which the assessee was placed, we consider that these two items of debt have become irrecoverable looking to the amounts involved as taking legal action may not prove commensurate with expenses. Therefore, these two items of amounts can be considered as bad debts. Apart from what has been stated before the authorities below, the assessee has not produced any evidence before us afresh to consider the case of bad debts as argued by the learned Counsel appearing for the firm. Under such circumstances, apart from the two items of debts which we consider as having become irrecoverable, we are unable to interfere with the other items of bad debts as claimed by the assessee. Accordingly, to that extent, we allow the appeal in part."], "relevant_candidates": ["0000061752", "0000178598", "0000320920", "0000774586", "0000957191", "0001506301", "0001609507"]} {"id": "0001628697", "text": ["JUDGMENT , J. ", "1. These petitions raise a common question and may conveniently be decided by a common judgment. ", "2. The petitioners are public limited companies and manufacture sugar through vacuum pan process. and manufacture alcohol also in the distilleries ituate within the premises of the sugar mills. manufacture sugar in Mawana Sugar Works, Mawana and Daurala Sugar Works, Daurala in the district of Meerut. also has a distillery for manufacturing alcohol from molasses. Molasses produced at the Mawana and Daurala Sugar Factories is transferred to the distillery situate in the premises of the Daurala Sugar Works, in the petition filed by it is not asserted that the petitioner manufactures alcohol also. In the process of manufacture of sugar molasses is produced as a bye-product which forms the basic material from which alcohol js manufactured. The molasses produced by the sugar mills is consumed in their distilleries. The State of Uttar Pradesh has passed an Act known as U.P. Sheera Niyantran Adhiniyam, 1964. Under the aforesaid Act the Excise Commissioner, U.P. is the Controller of Molasses, who exercises full power over the production, sale, preservation and price of molasses. On 1st March, 1975 for the first time imposed excise duty on the manufacture and production of molasses under Item No. 68 of the Schedule to the Central Excises and Salt Act . On 30th April, 1975, however, issued Notification No. 118/75-CE whereby it exempted molasses from payment of excise duty manufactured in a factory and intended for use in the factory in which it is manufactured or in any other factory of the same manufacturer. By Finance Act , 1980 the introduced Tariff Item No. 15CC in the First Schedule to the Central Excises and Salt Act and imposed an excise duty at the rate of Rs. 30/- per metric ton. On 19th June, 1980 issued Notification No. 86/80-CE exempting molasses from payment of excise duty which was not produced in the manufacture of sugar by the vacuum pan process. ", "3. The grievance of the petitioners is that they have been directed by the respondents to pay excise duty at the rate of Rs. 30/- per metric tonne plus special excise duty amounting to five per cent of the basic excise duty under Notification No. 86/80-CE dated 19th June, 1980 on the stock of molasses that the petitioners had in their factories on the date Item No. 15CC was introduced in the First Schedule to the Central Excises and Salt Act . The petitioners objected to this demand but without any success. They have prayed for quashing the demands raised by the respondents. , which has paid the duty demand by the respondents, has prayed for refund of the excise duty paid by it. Certain other prayers have been made in these petitions but since no argument was addressed in support thereof, they need not be set out here. ", "4. It was urged that since excise duty is essentially a tax on production and manufacture of excisable goods, no duty could be levied in respect of goods manufactured and produced during the period when excise duty was not leviable. According to the petitioners molasses produced prior to the date when Item No. 15CC was introduced in the Schedule to the Central Excises and Salt Act was exempt from excise duty under the notification dated 30th April, 1975. The demands made by the respondents are illegal. We find no merit in the contention. It is true that an excise duty by its very nature is on the production or manufacture of goods but as pointed out by ,in (A.I.R. 1977 S.C. 1459) the excise duty can be levied at a convenient stage so long as the character of the impost, i.e., it is a duty on the manufacture or production, is not lost. The method of collection does not affect the essence of the duty, but only relates to the machinery of collection for administrative convenience. Laws are to be found which impose a duty on excise at stages subsequent to the manufacture or production. ", "5. Rule 9 of the Central Excise rules provides that no excisable goods shall be removed from any place where they are produced, cured or manufactured or any premises appurtenant thereto, which may be specified by the Collector in this behalf, whether for consumption, export, or manufactures or any other commodity in or outside such place, until the excise duty leviable thereon has been paid at such place and in such manner as is prescribed in the rules or as the Collector may require. Rule 9-A provides that the rate of duty and tariff valuation, if any, applicable to any excisable goods shall be the rate and valuation in force (i) in the case of goods cleared from the premises of a curer on payment of duty on the date on which the duty assessed ; and (ii) in the case of goods cleared from a factory or a warehouse, subject to certain other rules, which are not relevant for our purpose, on the date of the actual removal of such goods from such factory or warehouse. Rule 49 also makes it clear that excise duty is chargeable on removal of the goods from the factory premises or from an approved place of storage. It clearly provides that payment of duty shall not be required in respect of excisable goods made in a factory until they are about to be issued out of the place or premises specified under Rule 9 or are about to be removed from a store-room or other place of storage approved by the Collector under Rule 47. These rules leave no room for doubt that excise duty is leviable not with reference to the date of manufacture of the excisable goods but at the time and at the rate on the date of removal of goods from the place of manufacture or from the approved place of storage. Thus the duty is linked in point of a time to the date of removal and not to the date of manufacture. The fact that in the present cases molasses was produced prior to 18th June, 1980 would not affect the liability of the petitioners for excise duty on the stock of molasses available with the petitioners when excise duty was levied on the molasses under the Finance Act , 1980. ", "6. It was urged that molasses manufactured by the petitioners was exempt from excise duty under the Notification dated 30th April, 1975 and since that notification has not been withdrawn, the petitioners were entitled to claim exemption from excise duty. The argument is untenable. By the aforesaid notification exempted goods falling under Item No. 68 of the First Schedule to the Central Excises and Salt Act in certain circumstances. At that stage molasses was not listed as a separate item in the Schedule but was treated to fall under residuary Tariff Item No. 68 of the Schedule. When the Finance Act , 1980 brought molasses under a specific item (No. 15-CC) it ceased to fall under the residuary Tariff Item No. 68 with the result that the notification dated 30th April, 1975 ceased to apply to molasses. No advantage can, therefore, be taken of the exemption granted under the aforesaid notification which has ceased to cover molasses now. ", "7. appearing for contended that since molasses in question was produced at the time when it was exempt from excise duty and the Finance Act of 1980, under which molasses was introduced as a specific item in the Schedule, did not give retrospective operation, this stock could not be subjected to excise duty. Learned counsel, however, could not point out any provision in the Act or the Rules that excise duty was leviable with reference to the date of production. As pointed out earlier, although excise duty is on the production or manufacture of goods, it can be imposed at a stage subsequent to the manufacture or production as held in (A.I.R. 1976 S.C. 182). This dictum has been approved in the case of (supra). ", "8. In the result the petitioners are not entitled to any relief. The petitions are accordingly dismissed with costs."], "relevant_candidates": ["0000264716", "0001225724"]} {"id": "0001652416", "text": ["JUDGMENT , J. ", "1. This appeal is directed against an appellate judgment of , dated the 19th May, 1950, which affirmed the judgment of a single Judge of the Original Side of that Court passed on 9th February, 1949, in Suit No. 2481 of 1947. ", "2. The plaintiff, who is the appellant before us, is the widow of one , a wealthy Hindu resident of Calcutta, while the defendant, who is still an infant, is the only son of born of his first wife , who died during the lifetime of her husband. The controversy between the parties centers round the short point as to whether the plaintiff is entitled, after the death of her husband, to act as shebait of an idol named founded by and his mother, either solely of jointly with the defendant, her step-son. ", "3. To appreciate the points that have been canvassed before us in this appeal, it will be necessary to narrate a few antecedent facts about which there is no dispute between the parties. It may be stated here that neither side adduced any evidence before the trial judge during the hearing of the case and the questions raised in the suit were argued as questions of law turning on the construction of the indenture which created the endowment as well as of the provisions of the Hindu Women's Rights to Property Act (Act XVIII of 1937 as amended by Act XI of 1938). ", "4. It appears that one , who was the adoptive father of , died on 28th of August, 1907, leaving behind him, his widow and the adopted son , who was then a minor. On February 11, 1910, obtained letters of administration to the estate of the deceased limited during the minority of the adopted son. On June 13, 1920, the widow purchased a house property in the city of Calcutta - being premises No. 14, Syakrapara Lane - out of the monies belonging to the estate of her husband, and on October 10, 1934, she conveyed the said property to who had by that time attained majority. ", "5. On the very same day that this property was conveyed to , and together executed an indenture, by which certain properties described in Schedules A and B of the document and including premises No. 14 Syakrapara Lane, were dedicated to deity Nitto Gopal Jew. The indenture recites that had, with the consent and concurrence of her son, established and consecrated the said idol and located it in premises No. 14, Syakrapara Lane, and that she had been performing the worship and periodical festivals of the deity according to Hindu rites. The document lays down in detail the various rites, ceremonies and festivals of the idol that are to be performed daily or at specific periods, and the way in which the expenses necessary for these purposes are to be met from the income of the dedicated properties. A remuneration of 25 per cent. of the net income of the debutter property has also been provided for the shebait or shebaits for the time being. After declaring the various trusts, the indenture proceeds to provide for appointment of shebaits and for devolution of shebaitship in the following manner :- ", "\"That the said Sm. doth hereby constitute and appoint herself the shebait of the said Thakur for the during the term of her natural life and doth hereby declare that after her death her son the said shall become the shebait of the said Thakur and after his death his wife and after her death the heirs of the said shall be and act as the shebait or shebaits of the said Thakur and she doth hereby declare him or them such shebait or shebaits accordingly and doth hereby direct and declare that the daily worship and other periodical festivals and ceremonies of the said Thakur should be performed by such shebait or shebaits. Provided however that in case the said shall happen to die without any issue or without giving any authority to his wife him surviving, to adopt, then in such case it shall be competent for the said to appoint by will or otherwise a shebait who would act as such after the death of his said wife as aforesaid but in case the said shall happen to die without any issue the shebaitship of the said Thakur after the death of his wife shall devolve upon his heirs under the Hindu Law.\" ", "6. It is not disputed that acted as shebait till her death in 1938 and that after her death became the shebait. , the first wife of , who is referred to in the indenture as stated above, died on 14th January, 1942, leaving her infant son , who is the defendant in the suit. Soon after her death, married the plaintiff as his second wife and within five months after this marriage died on the 4th of July, 1942. The present suit was filed in on 29th August, 1947, by and she prayed for a declaration that she was the sole shebait of the deity under the terms of the indenture or, in the alternative, was entitled to shebaitship jointly with the defendant, she being a co-heir of her stepson under the provisions of the Hindu Women's Rights to Property Act . There was a further prayer claiming a right of residence in premises No. 14, Syakrapara Lane. ", "7. The written statement that was filed on behalf of the defendant denied the plaintiff's claim of shebaiti right, either exclusively in herself or jointly with the defendant, and asserted that the defendant was the sole shebait under the terms of the deed of endowment as well as under law. The defendant also contended that the plaintiff was not entitled to any, right of residence in the premises mentioned above. ", "8. The learned trial Judge by his judgment dated 9th of February, 1949, held that the plaintiff was neither the sole shebait of the deity nor was she entitled to claim shebaiti rights jointly with the defendant and that the Hindu Women's Rights to Property Act was inapplicable to devolution of shebaiti rights at all. It was held further that as the plaintiff was not in law the natural guardian of the defendant, she could not claim to exercise the rights of a shebait on behalf of the defendant as his natural guardian so long as the defendant remained a minor. The learned Judge held, however, that the plaintiff's claim to a right of residence in premises No. 14, Syakrapara Lane, was well-founded and she was held entitled to relief in that respect. The result was that save and except giving the plaintiff a declaration of her right of residence in premises No. 14, Syakrapara Lane, all the other prayers of the plaintiff were dismissed. ", "9. Against this decision the plaintiff preferred an appeal which came up for hearing before an appeal Bench of consisting of Sir and The learned counsel appearing in support of the appeal did not seriously challenge that part of the decision of the trial Judge which negatived the plaintiff's claim to act as a sole shebait either under the terms of the indenture of endowment or as a guardian of the defendant during the period of his minority. The only question pressed was whether the plaintiff was entitled to be a joint shebait with the defendant. The learned Judges rejected this contention of the appellant primarily on the ground that the identical point was raised and considered by in [ F.C.R. 1] and it was held there that succession to shebaitship was not in any way altered or affected by the provisions of the Hindu Women's Rights to Property Act . The appeal was thus dismissed and the plaintiff having obtained a certificate under article 133(1)(c) of the Constitution has now come up in appeal to this Court. ", "10. The substantial contention raised by Mr. , who appeared on behalf of the plaintiff-appellant, is that under the clause in the indenture relating to devolution of shebaitship, the shebaitship is to go to after the death of and after her death it is to vest in the heirs of . As died during the life-time of , the grant of the shebaiti right in her favour lapsed and the heirs of are, therefore, entitled to come in as the next shebaits after 's death. Who these heirs are has got to be determined according to the law in force at the time when the succession opened and under the Hindu Women's Rights to Property Act , which came into force in the year 1937, the widow of a propositus, who dies intestate, would rank as an heir along with the son and would be entitled to the same share as a son gets in the property of the deceased. It is said that as shebaitship is property, it would devolve under section 3 of the Hindu Women's Rights to Property Act upon both the plaintiff and the defendant jointly. Assuming, however, for argument's sake, that the expression \"property\", as used in the Hindu Women's Rights to Property Act , does not include shebaiti right, it is argued by the learned counsel that it is a well-established proposition of law that succession to shebaitship is governed by the ordinary rules of inheritance in respect to secular property under the Hindu law, and as the Hindu Women's Rights to Property Act has amended the general law of inheritance in certain matters, the same alterations must be recognised in regard to succession to shebaitship as well. A point was also raised by Mr. - though it was not pressed seriously - that the language of the indenture would go to suggest that in the matter of succession to shebaitship the wife of would have priority over other heirs. It is true that the document speaks only of , the wife of who is to come as shebait after his death; but it is argued that the word \"\" is merely descriptive of the word \"wife\" and whoever would happen to be the wife of at the date of his death, would be entitled to succeed to his shebaiti rights. ", "11. Mr. appearing for the respondent stated at the outset that he would not dispute as a proposition of law that shebaitship is property of some kind, the devolution of which is governed, in the absence of any direction to the contrary given by the founder, by the ordinary rule of succession under the Hindu law. He contended however, that the Hindu Women's Rights to Property Act , which is a piece of special legislation enacted for a special purpose, does not use the expression \"property\" in a wide and unlimited sense; and it would appeal clear from the provisions of the different sections of the Act that it could not have had in contemplation, and does not purport to affect, the rules of succession relating to the special and somewhat anomalous type of property which shebaitship admittedly is. The learned counsel referred in this connection to the provisions of sections 3 and 5 of the Act as well as to the preamble which sets out its object, and considerable stress was laid upon the pronouncement of in [ F.C.R. 1]. The other contention put forward by the learned counsel turns upon the construction of the relevant clause in the indenture referred to above which lay down the mode of devolution of the shebaitship, and his argument was that reading the clauses as a whole, it would be clear that the intention of the executants of the deed was that the \"issue\" of would succeed to him as shebaits in the first instance and that no other heir of basing his claim either upon general law or any special enactment would be entitled to become shebait so long as any issue of was alive. A further question relating to the construction of the deed, raised by Mr. , was that the words \"heirs of the said \" occurring in the deed are to be construed not as words of devolution but of direct gift to the heirs under the deed and consequently the expression \"heirs\" must mean those who could legally claim as heirs at the time when the grant was made; and any subsequent change in the law could not affect the position. ", "12. We will first advert to and examine the provisions of the Hindu Women's Rights to Property Act and see whether the Act includes within its scope a property of such character as shebaitship is. ", "13. The exact legal position of a may not be capable of precise definition but its implications are fairly well established. It is settled by the pronouncement of in [48 I.A. 302] that the relation of a in regard to property is not that of a trustee to trust property under the English law. In English law the legal estate in the trust property vests in the trustee who holds it for the benefit of cestui que trust. In a Hindu religious endowment on the other hand the entire ownership of the dedicated property is transferred to the deity or the institution itself as a juristic person and the or mahant is a mere manager. But though a is a manager and not a trustee in the technical sense, it would not he correct to describe the ship as a mere office. The has not only duties to discharge in connection with the endowment, but he has a beneficial interest in the property. As observed in the above case, in almost all such endowments the has a share in the usufruct of the property which depends upon the terms of the grant or upon custom or usage. Even where no emoluments are attached to the office of the , he enjoys some sort of right or interest in the endowed property which partially at least has the character of a proprietary right. Thus, in the conception of i both the elements of office and property, of duties and personal interest, are mixed up and blended together; and one of the elements cannot be detached from the other. It is the presence of this personal or beneficial interest in the endowed property which invests ship with the character of proprietary rights and attaches to it the legal incidents of property. This was elaborately discussed by a Full Bench of in v. [I.L.R. 60 Cal. 452] and this decision of was approved of by in [63 I.A. 448] and again in [70 I.A. 57]. The effect of the first two decisions, as pointed out in the last case, was to emphasize the proprietary element in the i right, and to show that though in some respects anomalous, it was an anomaly to be accepted as having been admitted into Hindu law from an early date. \"According to Hindu law,\" observed Lord in v. [16 I.A. 137], 'when the worship of a Thakoor has been founded, the ship is held to be vested in the heirs of the founder, in default of evidence that he has disposed of it otherwise, or there has been some usage, course of dealing, or some circumstances to show a different mode of devolution.\" Unless, therefore, the founder has disposed of the ship in any particular manner - and this right of disposition is inherent in the founder - or except when usage or custom of a different nature is proved to exist, ship like any other species of heritable property follows the line of inheritance from the founder. ", "14. Turning now to the Hindu Women's Rights to Property Act , it will be seen that the object of the Act, as set out in the preamble, is to give better rights to women in respect of property. Section 2 lays down :- ", "\"Notwithstanding any rule of Hindu law or custom to the contrary, the provisions of section 3 shall apply where a Hindu dies intestate.\" ", "15. Section 3(1) then provides :- ", "\"When a Hindu governed by the Dayabhaga School of Hindu law dies intestate leaving any property, and when a Hindu governed by any other school of Hindu law....... dies intestate leaving separate property, his widow, or if there is more than one widow all his widows together, shall, subject to the provisions of sub-section (3), be entitled in respect of property in respect of which he dies intestate to the same share as a son : ", "Provided that the widow of a predeceased son shall inherit in like manner as a son if there is no son surviving of such predeceased son, and shall inherit in like manner as a son's son if there is surviving a son or son's son of such predeceased son; ", "Provided further that the same provision shall apply mutatis mutandis to the widow of a predeceased son of a predeceased son.\" ", "16. Sub-sections (2) and (4) of section 3 are not material for our present purpose. Sub-section (3) lays down :- ", "\"Any interest devolving on a Hindu widow under the provisions of this section shall be the limited interest known as a Hindu woman's estate.............\" ", "17. Section 4 lays down that the Act is not to operate retrospectively. The only other section in the Act which has been referred to in the course of arguments is section 5 which runs as follows :- ", "\"For the purposes of this Act a person shall be deemed to die intestate in respect of all property of which he has not made a testamentary disposition which is capable of taking effect.\" ", "18. It will be seen that section 3(1) abrogates the general rule of Hindu law according to which a widow succeeds to her deceased husband's property only in default of male issue and she is now entitled to the same share as a son along with or in default of male issue. Similar rights have been given by the two provisos attached to section 3(1) to the widow of a predeceased son and also to the widow of a predeceased son of a predeceased son. Section 3(1) speaks of \"any property\". The expression prima facie includes, unless something to the contrary can be spelt out from the other provisions of the Act, all forms or types of interest answering to the description of \"property\" in law. Of course, the property must be heritable property in respect to which alone the question of succession may legitimately arise. ", "19. Reliance has been placed by Mr. , first of all, upon the object or purpose for which the statute was passed. The object, as set out in the preamble, is to give better rights to women in respect to property; in other words, the object of the legislation is to confer larger rights upon women in comparison to what they enjoyed under the ordinary Hindu law. In our opinion, the preamble does not throw any light on the question as to whether the Act does or does not include within its ambit rights and interest of a shebait. ", "20. Mr. next invokes in support of his contention the provisions of sub-section (3) of section 3 , which lays down that the interest devolving upon a widow under the provisions of the Act will be the limited interest known as the \"Hindu woman's estate\". It is argued that this distinction between the Hindu woman's estate and the unrestricted rights of a male heir can be predicated only of ordinary secular property, but this distinction is unmeaning when applies to i right, for the nature of the interest enjoyed by a male or a female is exactly the same. This argument does not appear to us to be at all convincing. Precisely the same thing happens when the i right devolves upon a female heir under the ordinary law of inheritance. If a dies leaving behind him a widow and no male issue, the widow would succeed to ship under ordinary law but her rights in respect of the i would be restricted in the same manner as they would have been if the successor was the son. This is because there are certain limitations and restrictions attached to and inherent in the i right itself and they exist irrespective of the fact as to whether the ship devolves upon a male or a female heir. But although as regards powers of alienation the disability of the male and the female s may be identical, there is yet a distinction between them as regards the other limitation or characteristic of a Hindu woman's estate. When Hindu female heir succeeds to the property of a male propositus, she cannot transmit the interest which she inherits, to her own heirs upon her death. The property goes after her death not to her heirs but to the heirs of the last male owner. This rule applies even when the right which devolves upon a widow is the right of a . After her death the i right would not pass to her stridhana heirs but would go to heirs of the last [Anuragi Kuer v. , A.I.R. 1939 Pat. 1]. Sub-section (3) of section 3 , therefore, is of no assistance to Mr. 's client. ", "21. Mr. then contends that section 5 of the Hindu Women's Rights to Property Act affords a clear indication that the Act is intended to be applicable only to property in respect to which a testamentary disposition is possible. This section, it may be noted, was added by the amending Act XI of 1938 and the object apparently was to explain what is meant by \"dying intestate\". It says that for the purposes of the Act a person shall be deemed to die intestate in respect of all property of which he has not made a \"testamentary\" disposition which is capable of taking effect. Mr. would read the section as qualifying the meaning of the word \"property\" as used in section 3(1) or rather as engrafting a limitation upon it. What he says is, that the language of the section would be wholly inappropriate if the Act is applicable to properties in respect to which, as in the case of shebaitship, no testamentary dispossession is possible. This argument, in our opinion, cannot be accepted as sound. Section 2 of the Act which has been referred to above makes the provisions of section 3 applicable only when a Hindu dies intestate. A person is ordinarily regarded as dying intestate when he has left no will disposing of his properties. A doubt might arise as to whether this Act would apply when a will was actually executed by a deceased, but for some reason or other it was incapable of taking effect and it was for the purpose of removing such doubt that this section was added by the amending Act of 1938. The language of section 5 of the Act is exactly the same as that of section 30 of the Indian Succession Act and the object underlying both these provisions appears to be identical. Mere execution of a will is not enough to exclude the operation of the Act. The will must be an operative will and if the will is void or incapable of taking effect, it would be deemed that the testator has died intestate. If the property is \"non-testamentable\", as Mr. puts it, no testamentary disposition of such property is possible or could take effect in law and the testator must in such circumstances be deemed to have died intestate in respect of such property. Thus, there is nothing in any of the provisions of the Act from which an inference could be drawn that the expression \"property\" as used in section 3(1) has a limited or restricted interpretation and is not applicable to shebaitship, which is recognized as property in Hindu law. ", "22. Reference may now be made to the decision in [ F.C.R. 1], upon which the learned appellate Judges of practically based their decision. The facts of that case stripped of unnecessary details are that one who was a resident of Madras and owned considerable properties, moveable and immoveable, both within the outside British India, died leaving behind him two widows and the widow of a predeceased son. The deceased had left a will but the legacies given by the same exhausted only a small portion of his estate so that with regard to the rest which was of considerable value he died intestate. The deceased was in possession of several trust properties in regard to which there were certain religious and charitable trusts and the direction in the will was that the management of these trusts should devolve upon his heirs. The son's widow instituted a suit in the court of the Subordinate Judge at Devakottai for administration of the estate and for partition and separate possession of a half share of the same, basing her claim upon the Hindu Women's Rights to Property Act . The suit was resisted by the two widows as well as by the executors appointed under the will of the deceased and it was pleaded, inter alia, that the Hindu Women's Rights to Property Act was ultra vires the legislature and that in any event it was not applicable as the propositus did not die intestate. The trial court held first that the Act was not ultra vires and was operative on all properties with the exception of agricultural lands and this finding was affirmed by on appeal and also on further appeal to the by the majority of the Judges of that Court. The second finding of the trial Judge was that the deceased died intestate with regard to a considerable amount of property and consequently the plaintiff was entitled to a half share thereof. affirmed this finding with this variation that her claim to moveable situated outside British India was not allowed but the reversed the decision of on this point and restored that of the trial Judge. The other point and that is the point with which we are concerned in the present case, related to the devolution of the trust estates which were held by the testator. Both the courts below concurred in holding that these trusts should go to the heirs of the deceased under the ordinary Hindu law and that the provisions of the Hindu Women's Rights to Property Act were not attracted to the trusts. This decision was upheld by the majority of the Judges in the and that point was actually dealt with by in his judgment. The view expressed by the learned Judge is that the Hindu Women's Rights Property Act was intended to apply only to properties beneficially owned by the propositus and it was not applicable to rights in the nature of trusteeship. It seems to us that, property construed, this decision does not stand in the way of the appellant. In the first place, we do not know at all what he nature of these trusts was. The learned Judge observed himself in his judgment that there was little or no evidence as to the terms of the foundations in respect of any of the trusts \"managed\" by the deceased. This observation, taken along with the terms of the documents referred to in the judgment, would go to show that the deceased was a mere manager of the trusts and in respect of some of them at least he was the manager jointly with other persons. In , Sir expressly held that in no sense could the trust properties be regarded as the separate property of the testator and consequently Act XVIII of 1937 could not apply to such a case. observed with reference to the documents relied upon by the learned counsel for the appellant that they only provided for \"management by his heirs.\" At any rate, we have no materials to hold that in regard to the trusts that formed the subject-matter of that suit the trustees had any beneficial or personal interest in the trust properties. The indications, on the other hand, are clearly in the opposite direction. In these circumstances, no question arises in the present case of controverting the proposition of law that purported to lay down, namely, that the Hindu Women's Rights to Property Act could not govern succession to property in respect to which the propositus had no beneficial enjoyment. It is not possible, however, to enunciate on the basis of this decision, a broad rule of law that succession to shebaitship, in which an element of beneficial or personal interest is normally involved would not be governed by the provisions of the Act. There are indeed one or two observations of the learned Judge in his judgment, not very definitely expressed, from which it is not impossible to draw an inference in favour of the respondent, but we think that they should be construed in the light of the facts and the actual decision in the case. The observation that Hindu law regards trusteeship as property for certain purposes is of a most general character and it has to be noted that not only the word \"shebaitship\" has not been used by the learned Judge but he does not even confine his remarks even to religious trusts. Moreover, trusteeship is not certainly equivalent to shebaitship. On the other hand, the reference made by the learned Judge to the limited objective of the Act affords an indication that he had in mind a trust of such a character where the trustee had no personal interest in the trust property. The object of the Act, as stated above, is to give better rights to women in respect of property. If a trusteeship, even if it is regarded as property, carries with it no emoluments or any beneficial interest for the trustee and consists of nothing else But a bundle of obligations and duties, it might possibly be said that the giving of share in such rights to a Hindu widow would not in any wan improve her position. But the position would be obviously different if there is a beneficial interest of a substantial kind inseparably connected with the duties of a particular office. They again, the learned Judge possibly used the expression \"private property\" in a somewhat loose sense as meaning personal property in respect to which the proprietor has a beneficial interest of his own. The reference to section 3(3) of the Hindu Women's Rights to Property Act is, as we have indicated already, not much helpful for the purpose of construing the Act. After all, we must take the decision as it stands and it is not right to call into aid a particular reason assigned by the learned Judge, for the purpose of carrying the decision beyond what it actually purports to lay down. We think that a very proper view of the effect of this decision of the has been taken by a Division Bench of in . There the question arose in connection with the rights associated with the office of archakatvam, which is a hereditary religious office and the holder or holders of it for the time being are beneficially entitled to enjoy the income of the endowed property. It was held that the principle laid down by the in [ F.C.R. 1] has no application to a case relating to the office of archakatvan. It is pointed out by that though the observations of the learned Judge in the are wide, the decision proceeded only on the main ground that the Act governs succession to property beneficially owned by the propositus. In our opinion, the same reasons apply to the case of the hereditary shebait of a private debutter, particularly where, as in the present case, 25 per cent. of the net income of the endowed properties has been given to the shebait of shebaits for the time being as their remuneration. Our conclusion, therefore, is that there is nothing in any of the provisions of the Hindu Women's Rights Property Act which excludes from the scope of operation of the Act succession to shebaitship is a recognized form of property in Hindu Law. ", "23. Assuming that the word \"property\" in Act XXIII of 1937 is to be interpreted to mean property in common and ordinarily accepted sense and is not to be extended to any special or peculiar type of property, even then we think that the other contention of Mr. is perfectly sound. Succession of shebaitship, even though there is an ingredient of in it, follows succession to ordinary or secular property. It is the general law of succession that governs succession to shebaitship as well. While the general law now been changed by reason of Act XVIII of 1937, there does not appear to be any cogent reason why the law as it stands at present should not be made applicable in the case of devolution of shebaitship. ", "24. The last contention of Mr. that under the indenture itself the wife of and particularly has been given rights of succession to shebaitship prior to any issue of manifestly untenable and as the learned counsel was not at all serious in pressing this point, we consider unnecessary to discuss it any further. ", "25. It remains for us now to advert to and consider the other contentions raised by Mr. which depend upon the construction of the relevant clauses in the indenture. It may be stated at the outset that we are not at all impressed by the argument of the learned counsel that the words \"heirs of the said \" occurring in the document are to be construed as words not of inheritance but of grant. Such construction would be against the language and the whole tenor of the document. It is to be noted that was the owner of the dedicated properties and the real founder of the endowment. The mother was associated with him in the act of dedication because it was she who consecrated and established the deity and was looking after its worship and service since it was installed. It was in the fitness of things therefore that should request his mother to become the first shebait and this is exactly what is recited in the indenture. After the death of , , the founder, himself, was to be the shebait and save and except the provision made in favour of , his existing wife, the devolution of shebaitship has been directed to be in the line of heirs of the founder. There is no indication of any intention to treat the heirs as the objects of an independent gift. It may be noted that this identical point was raised before in [ F.C.R. 1] with regard to the devolution of trust estates. The direction in the will in that case was that they should go to the heirs. It was held by that it was not reasonable to construe such words as words of gift and not of devolution. ", "26. On the question of construction Mr. 's main argument is that if the relevant provisions of the indenture dealing with devolution of shebaitship are read as a whole, it will be manifest that the executants of the deed intended that the issue of were to have preference over other heirs in the matter of succession to shebaitship; and that an heir who is not an issue could not come in so long as an issue remained alive. The relevant portion of the document has been set out already and it provides in the first place that after the death of , her son, the said Mullick, shall become the shebait, after him his wife , and after her death, the heirs of the said Mullick shall be and act as shebaits. Then there is a proviso to the effect that if the said shall happen to die without any issue or without giving any authority to his wife, him surviving, to adopt, then in such case it shall be competent for to appoint by will or otherwise a shebait who would act as such after the death of the said wife; but in case the said Mullick shall happen to die without any issue, the shebaitship of the said after the death of his wife shall devolve upon his heirs under Hindu Law. Mr. lays stress upon the proviso, particularly the last portion of it and it contains, according to him, a clear direction that it is only on the failure of issue that the heirs of can come in as shebaits. In order that the proviso may be reconciled with the clause that precedes it, Mr. invites us to hold that the word \"heirs\" in the previous clause should be taken to mean only the issue of . ", "27. We do not think that the interpretation suggested by the learned counsel is the proper one. A proviso is normally an excepting or a qualifying clause and the effect of it is to except out of the preceding clause upon which it is engrafted something which but for the proviso would be within it. The word \"heirs\" cannot normally be limited to issue only. It must mean all persons who are entitled to the property of another under the law of inheritance. So far as the main provision is concerned there is nothing in the language or in the context to suggest that the word \"heirs\" has not been used in its ordinary or natural sense. Mr. argues that the proviso in that case would be wholly inexplicable whereas it is a sound canon of construction that all the parts of a document should be read together and no portion is to be omitted. In our opinion, the clause that precedes the proviso lays down the general rule relating to devolution of shebaitship. The expression \"heirs\" has not been used in any restricted or limited sense and extends to all persons who are entitled to succeed under the law. The proviso engrafts an exception upon the general rule. What it does is to give a power to to appoint a shebait, who would come as such after his death in the contingency of his dying without any issue and without giving any authority to his wife to adopt a son. It may be noted that the word \"issue\" includes both son and daughter and the power of appointment cannot be exercised by even if he has a daughter living. The proviso thus qualifies the main provision to this extent that if the particular contingency that is mentioned here is fulfilled, would be entitled to appoint a shebait, although no such power can be deduced from the general clause. In case the contingency does happen but the wife is not given any power of adoption and no appointment is also made by , the consequence would certainly be that the other heirs of would succeed as shebaits and this is what is laid down in the concluding portion of the proviso. The expression \"his heirs\" at the end of the proviso would certainly mean heirs other than the son and daughter of . As actually left a son, the contingency contemplated by the proviso did not arise at all and in these circumstances the proviso is to be ignored altogether for purposes of construction and it is not proper to attempt to spell, out of it, by implication, something which is not only not in the main provisions but is contradictory to it. We think, therefore, that this contention of Mr. also must fail. ", "28. The result, therefore, is that, in our opinion, the appeal succeeds. The judgment and decree of both the courts below are set aside except the declaration of the right of residence of the plaintiff which was given by the trial court and not disturbed in appeal. In addition to that, it will be declared that the plaintiff is entitled to joint shebaitship with the defendant in respect of the created by the indenture of October 10, 1934. We direct the taxed costs of both the parties in all the courts to be paid out of the estate. ", ", ", "29. I agree with the conclusion reached by my three learned brothers in the judgment just now pronounced, but I would like to add a few words on two points on which I do not see eye to eye with them fully. ", "30. In support of his contention that the word \"property\" in the Hindu Women's Rights to Property Act cannot be construed so comprehensively as to include a shebait right, Mr. referred to sub-clause (3) of section 3 , which speaks of \"any interest devolving on a Hindu widow under the provisions of this section shall be the limited interest known as a Hindu Woman's estate\"; and he urged that the conception of such an estate as distinguished from an absolute interest is inapplicable to such a right of property. This is a point that deserves some attention. In dealing with it, we are not thinking of any property endowed to the Thakur or the deity and its intrinsic legal characteristics as constituting a religious endowment. We have in mind the shebaitship itself as a species of property. Can it be postulated with reference to the shebaitship that a Hindu widow succeeding to the office has only what is known as a \"Hindu woman's estate\" as contrasted with a full or absolute estate taken by a male heir ? Does a male heir get higher rights than a Hindu widow ? and if so, what are they ? So far as a shebaitship is concerned, the office does not ensure beyond the lifetime of the holder, whether male or female, and is generally inalienable. It is res extra commercium. A male heir cannot alienate it any more than a female heir. What limitations exist or are imposed on alienability arises out of the nature of the property and not out of the nature of the estate taken by the heir. In the very nature of things, there can be no alienation for necessity, surrender, acceleration of the estate in favour of the next in succession, etc. Plausible and attractive is this line of reasoning, and it lends support to the view taken in [ F.C.R. 1] by Sir , where, referring to sub-clause (3) of Section 3 , he observes :- ", "\"This provision will be appropriate enough in relation to private property where the woman's estate is different from the interest taken by a male heir. But in respect of trusteeship or other similar office, the law makes no difference between the interest taken by a male heir and the interest taken by a female heir.\" ", "31. But it does not decisively outweigh the several considerations set forth in the judgment just now delivered by my learned brother for construing the word \"property\" in a wider sense so as to include the shebaiti right also. It there is no legal objection to a woman being a shebait under Hindu law, there is no particular reason why she should be excluded from succeeding to the same under an Act which imposes no restriction or prohibition either in express terms, or by necessary implication. ", "32. The next point relates to the construction of the deed of indenture executed by and . I am of the opinion that the technical rules of interpretation of provisos and exceptions with reference to their scope and legal effect, adopted in construing statutes should not ordinarily be imported in interpreting deeds and documents executed by laymen, In ordinary deeds, a proviso may sometimes be in the nature of an explanation of the main clause or provision; and we must look not merely at the form of the language but its substance, the governing idea or purpose of the deed, the context and the surrounding circumstances togather the real meaning or intention of the executant. Judged in this light and adopting a broad construction, it appears to me that what had in mind when he executed the indenture was, as made clear in the proviso, that his issue (born of his loins) or any person whom his wife may adopt on his authority, should succeed to the shebaiti in the first instance; and secondly, in default of such contingency, the shebaitship should go to any person who may be nominated in this behalf by his will; and thirdly, in default of issue (born or adopted) and in default of nomination by will (which is necessarily implied), the right was to devolve upon his heirs under the Hindu law. In other words, the proviso explains what he means by his heirs in the preceding clause. In this view, the respondent will succeed to the office in preference to the appellant. ", "33. But the construction placed on the indenture by my learned brothers is also a possible one and I do not desire to express any dissent from the result they have reached. ", "34. Appeal allowed."], "relevant_candidates": ["0000242776", "0000814692", "0000987299", "0001012363", "0001241624"]} {"id": "0001662637", "text": ["PETITIONER: SALES TAX OFFICER, AND ANOTHER Vs. RESPONDENT: M/S. SHIV RATAN G. MOHATTA DATE OF JUDGMENT: 12/02/1965 BENCH: , S.M. BENCH: , , CJ) , M. , J.C. CITATION: 1966 AIR 142 1965 SCR (3) 71 CITATOR INFO : RF 1975 SC1652 (12) ACT: Constitution of India. Arts. 226 and 286(1)(b)--Questions of fact to determine whether sale in the course of import--Therefore if sales tax leviable--Whether should be decided in writ proceedings. HEADNOTE: The Sales Tax Officer rejected the assessed's claim that he was not liable to be assessed to sales tax in respect of certain .sales of cement imported from Pakistan because (i) he was not a. dealer within the meaning of s.2(f) of the Rajas than Act 29 of 1954, and (ii) the sales in question were in the course of the import within the meaning of Art. 286(1)(b) of the Constitution. In the order of assessment, there was no discussion of the question of applicability of Art. 286(1) (b). The assessee therefore filed a petition under Art. 226 challenging the assessment order on the grounds taken before the Sales Tax Officer and also claiming that the latter had failed to consider the impact and effect of Art. 286(1)(b) on the facts of the case. The objected to the maintainability of the petition on the ground that the petitioner should have availed of the alternative remedy of appeal provided under the Rajasthan Sales Tax Act, but overruled this objection for the reason, inter alia, that the petitioner had challenged the appellant's jurisdiction to assess him to. sales tax in view of the. provisions of Art. 286(1) (b). Upon dealing with the merits of the case, held that on the facts of the case it was clear that the sales in question took place when the goods were in the course of import and therefore, by virtue of Art. 286(1)(b) were not liable to sales tax. The court therefore quashed the order of assessment. On appeal to this Court, it was contended on behalf of the that should have refused to entertain the petition as many of the crucial facts had not been brought on the record by the respondent, and further-more, it was not established that the cement was sold in the course of import into India. HELD: should not have decided the disputed questions of fact, but should merely have quashed the assessment order on the. ground that the Sales Tax Officer had not dealt with the question raised before him and remanded the case. [77 B] OBITER: should have declined to entertain the petition, as in this case there were no exceptional circumstances to warrant the exercise of the extraordinary jurisdiction under Art. 226. It was not the object of Art. 226 to convert into original or appellate assessing authorities whenever the assessee chose to attack an assessment order on the ground that a sale was made in the course of import and was therefore exempt from tax. The fact that an assessee might have to deposit sales tax when filing an appeal could not in every case justify his bypassing the remedies provided by the Sales Tax Act . There must be something more in a case to warrant the entertainment of a petition under Art. 226 , something going to the root of the jurisdiction of the Sales 72 Tax Officer, something to show that it would be a case of palpable injustice to the assessee to force him to adopt the remedies provided by the Act. [75 , A.I.R. 1961 S.C. 1506, referred to. JUDGMENT: ", "CIVIL APPELLATE JURISDICTION:Civil Appeal No. 652 of 1964, Appeal from the judgment and order dated May 7, 1963 of in D.B. Civil Misc. Writ Petition No. 157 of 1962. ", ", Advocate-General for Rajasthan. , for the appellants. ", " and , for the respondent. The Judgment of the Court was delivered by , J. This appeal by certificate of fitness granted by is directed against its judgment dated May 7, 1963, quashing the order of assessment dated March 5, 1962, made by , Jodhpur City, in so far as it levied sales tax on the turnover of Rs. 23,92,252.75 np. ", "The respondent, , which is a partnership firm having its head office at Jodhpur, hereinafter referred to as the assessee, claimed before the Sales Tax Officer that they were not liable to be assessed to sales tax in respect of the above turnover because, firstly, the assessee was not a dealer within s. 2(f) of the Rajasthan Sales Tax Act (Rajasthan Act XXlX of 1954) with respect to this turnover, and secondly, because the sales were in the course if import within Art. 286 (1)(b) of the Constitution. Although the Sales Tax Officer set out the facts of the case relating to the second ground, he deemed it sufficient to assess this turnover on the ground that the assessee was a dealer within s. 2(f) of the Rajasthan Sales Tax Act, without adverting to the second ground. The facts on which the assessee had relied upon to substantiate his second ground were these. , Hyderabad (Pakistan), hereinafter called , manufactured cement in Pakistan. , hereinafter called , entered into an agreement with Milkhiram and , Bombay, for the export of cement manufactured in Pakistan to India. of India entered into an agreement with the said Milkhiram & Sons for the purchase of, inter alia, 35,000 long tons of cement to be delivered to it F.O.R. Khokhropar in Pakistan, on the border of Rajasthan. appointed the assessee as its agent, broadly speaking, to look after the import and the sale of the imported cement. The modus operandi adopted by the assessee for the sale of the cement was as follows. It would obtain from a buyer in Rajasthan an order under an agreement, a sample of which is on the record The agreement fixed the price and the terms of supply. By one clause the assessee disclaimed any responsibility regarding delay in dispatch and non-receipt of consignment or any loss, damage or shortage in transit due to any reason whatsoever. The agreement further provided that \"all claims for loss, damage or shortage, etc., during transit will lie with the carriers and our payments are not to be delayed on any such account whatsoever.\" It was further provided in the agreement that the dues were payable in advance in full, or 90% in advance and the balance within 15 days of billing plus sales tax and other local taxes. Clause 6 of the agreement is in the following terms: ", "\"A Post Card Loading Advice will be sent to you by the Factory as soon as the wagons are loaded in respect of your orders, and it will be your responsibility to arrange for unloading the consignment timely according to Railway Rules. Ourselves. and the suppliers will not be responsible for demurrage etc. on any account whatsoever. If the consignment reaches earlier than the Railway Receipt, it is the responsibility of buyer to arrange for and get the delivery timely against indemnity bond etc. All the Railway Receipts etc. will be sent by registered post by the Suppliers in Pakistan.\". ", "After this agreement had been entered into, the assessee would send despatch instructions to . These instructions indicated the name of the buyer-consignee and the destination, and provided that the railway receipt and D/A should be sent by registered post to the consignee. These instructions were sent with a covering letter to requesting that these instructions be passed on to for necessary action. would then forward these despatch instructions to . Later, would advise the consignee that they had \"consigned to , Karachi, the particular quantity as per enclosed railway receipt and invoice.\" , Karachi, would endorse the railway receipt in favour of the consignee and send it to him by post. The consignee would take delivery either by presentation of the railway receipt or by giving indemnity bond to the Station Master undertaking to deliver the railway receipt on its receipt. The Sales Tax Officer did set out most of these facts and the contentions of the assessee in the assessment order but disposed of the case with the following observations: ", "\"All the above went to prove that the assessee was an Agent of the non-resident dealer for the supplies in the State. The Assessee was an importer and hence submitted an application to for the same. It booked orders and issued sale bills. Under the terms of an agreement of appointment of Agent, sale was to be effec- ", "74 ", "ted by the Agent. Again while obtaining orders from the buyers under condition 5 Sales Tax was to be paid by the buyers to the assessee. Thus to all intents and purposes the assessee is a dealer who is liable for payment of Sales Tax to the State. They have rightly collected this amount from the buying dealers and retained with them. This should come to the Government.\". ", "We can find no discussion in the order on the question raised by the assessee that the sales were made in the course of import within Art. 286(1)(b) of the Constitution. ", "The assessee then filed a petition under art. 226 of the Constitution and raised two contentions before , namely, (1) that the Sales Tax Officer failed to consider the impact and the effect of Art. 286(1)(b) on the facts of the case, and (2) that the Sales Tax Officer illegally held that the petitioner for all intents and purposes was a dealer liable to pay sales tax. The raised an objection to the maintainability of the petition on the ground that the petitioner should have availed of the alternative remedy of appeal provided under the Rajasthan Sales Tax Act, but overruled this objection on the ground that \"the contention of the petitioner is that in view of Art. 286(1)(b) of the Constitution, the respondent had no jurisdiction to assess the petitioner to pay the sales tax on the sale of goods in the course of the import into the territory of India\", and that even if there was no total lack of jurisdiction in assessing the petitioner to pay sales tax. the principle enunciated in v Ram chand (1) applied, and it was a case which should not be dismissed in litnine. ", "Then proceeded to deal with the merits of the case. It first dealt with the question whether the petitioner was a dealer within the meaning of s. 2(f) of the Rajasthan Sales Tax Act, and came to the conclusion that the petitioner must be deemed to be a dealer within the said s. 2(f) . ", "Then it proceeded to deal with the question whether the sales had taken place in the course of import. held that in the circumstances of the case these sales had not occasioned the movement of goods but it was the first sale made by and Sons to which had occasioned the movement of goods. Secondly, it held that in the circumstances of the case \"the property in goods after the delivery had been taken by the petitioner on behalf of passed to and simultaneously to the ultimate buyers. Thus the property in the (1) [1962] 1 S.C.R. 753. ", "75 ", "goods passed to the ultimate buyers in Rajasthan when the goods had not reached the territory of India and were in course of import. In view of the authority of their Lordships of in , ('), it must be taken that the sale took place when the goods were in the course of the import and they should not be liable to the payment of the Sales Tax by virtue of Art. 286(1)(b).\". In the result, quashed the order of assessment in so far as it sought to levy tax on the turnover in dispute. The Sales Tax Officer, Jodhpur, and the State of Rajasthan having obtained certificate of fitness from filed this appeal. ", "The learned Advocate-General has raised two points before us: First, on the facts of this case should have refused to entertain the petition, and secondly, that it has not been established that the cement was sold in the course of import within Art. 286(1)(b). Regarding the first point, he urges that an appeal lay against the order of the Sales Tax Officer; no question of the validity of the Sales Tax Act was involved and the taxability of the turnover depended on where the property passed in each consignment. This involved consideration of various facts and, according to him.the crucial facts had not been brought on the record by the assessee on whom lay the onus to establish that the sales were in the course of import. He says that the assessee should have proved that each railway receipt was endorsed by , Karachi, to the buyer before each consignment crossed the frontier. ", "We are of the opinion that should have declined to entertain the petition. No exceptional circumstances exist in this case to warrant the exercise of the extraordinary jurisdiction under Art. 226. It was not the object of art. 226 to convert into original or appellate assessing authorities whenever an assessee chose to attack an assessment order on the ground that a sale was made in the course of import and therefore exempt from tax. It was urged on behalf of the assessee that they would have had to deposit sales tax, while filing an appeal. Even if this is so. does this mean that in every case in which the assessee has to deposit sales tax, he can bypass the remedies provided by the Sales Tax Act ? Surely not. There must be something more in a case to warrant the entertainment of a petition under art. 226 , something going to the root of the jurisdiction of the Sales Tax Officer, something to show that it would be a case of palpable injustice to the assessee to force him to adopt the remedies provided by the Act. But as chose to entertain the petition, we are not inclined to dismiss the petition on this ground at this stage. ", "(1)[1960] 2 S.C.R. 852. ", "76 ", "Regarding the second point, the learned Advocate- General .argues that the onus was on the assessee to bring his case within Art. 286(1)(b) of the Constitution in respect of the sales to the various consignees. He says that there is no evidence on record as to when endorsed the railway receipt in favour of the ultimate buyer in respect of each consignment and without this evidence it cannot be said that the title to the goods passed to the ultimate buyer at Khokhropar or in the course of import. He further urges that it would have to be investigated in each case as to when endorsed the railway receipt and when the goods crossed the customs barrier. He says that it is not contested that the ultimate buyer took delivery of goods without producing the railway receipt by virtue of special arrangements entered into with the railway, and according to him. it is only when the delivery was taken by the buyer in Rajasthan that the title passed. By that time, according to him, the course of import had ceased. ", "We do not think it necessary to consider the various arguments addressed by the learned Advocate-General or the soundness of the view of on this point, because we are of the opinion that should not have gone into this question on the facts of this case. The Sales Tax Officer had not dealt with the question at all, and it is not the function of under art. 226 , in taxing matters, to constitute itself into an original authority or an appellate authority to determine questions relating to the taxability of a particular turnover. The proper order in the circumstances of this case would have been to quash the order of assessment and send the case back to the Sales Tax Officer to dispose of it according to law. Under the Rajasthan Sales Tax Act, and other Sales Tax Act s, the facts have to be found by the assessing authorities. If any facts are not found by the Sales Tax Officer, they would be found by the appellate authority. and it is not the function of to find facts. should not encourage the tendency on the part of the assesses to rush to after an assessment order is made. It is only in very exceptional circumstances that should entertain petitions under art. 226 of the Constitution in respect of taxing matters after an assessment order has been made. It is true, as said by this Court in (1) that it would not be .desirable to lay down inflexible rules which should be applied with rigidity in every case, but even so when the question of taxability depends upon a precise determination of facts and some of the facts are in dispute or missing, should decline to decide such questions. It is true that at times the assessee alleges some additional facts not found in the assessment order and the , after a fresh investigation, admits these facts, but in a petition under art. ", "(1)[1962] 1 S.C.R. 753. ", "77 ", "226 where the prayer is for quashing an assessment order, is necessarily confined to the facts as stated in the order or appearing on the record of the case. In this case, as already indicated, we have come to the conclusion that should not have decided disputed questions of fact, but should merely have quashed the assessment order on the ground that the had not dealt with the question raised before him and remanded the case. Accordingly. we allow the appeal, set aside the order of , quash the assessment order in so far as it relates to the. turnover of Rs. 23,92.252.75 up, and remit the case to the to decide the case in accordance with law. He will find all the facts necessary for the determination of the question and come to an independent conclusion untrammeled by the views expressed by . We may make it clear that we are not expressing any view whether the finding of that the property in the goods passed simultaneously at Khokhropar to and the ultimate buyer is correct or not. There would be no order as to costs in this appeal. Appeal allowed. ", "B(N)3SCI --7"], "relevant_candidates": ["0001457646", "0001775619"]} {"id": "0001673100", "text": ["JUDGMENT Mootham, J. ", "1. This is a petition under Article 226 of the Constitution which gives rise to a question of some constitutional importance. ", "2. The petitioner held the substantive rank of Inspector of Police. In 1946 he was appointed to and in the following year he was promoted to the officiating rank of Deputy Superintendent of Police. ", "In January, 1948, an anonymous letter was received by the Inspector-General of Police making charges against the petitioner. After making certain confidential enquiries the Inspector-General formed the opinion that the petitioner's conduct required investigation and he directed the Deputy Inspector-General of Police, , to take the necessary action. At the same time he placed the petitioner under suspension and reverted him to his substantive rank of Inspector. ", "3. Under the orders of the Deputy Inspector-General of Police an enquiry was conducted by , Superintendent of Police, , whose report was in due course submitted to the Inspector General of Police. ", "4. In the meantime, on 4-11-1947, the Governor of the United Provinces had made rules known as the Disciplinary Proceedings (Administrative Tribunal) Rules, 1947, \"for regulating in certain cases the conduct of disciplinary proceedings and the award of punishment to members of the public services under the Governor's rule-making control.\" ", "Under these Rules the Governor purported to confer upon himself power to refer to a constituted in accordance with the Rules cases relating to Government servants in respect of matters involving, 'inter alia', \"corruption\", \"failure to discharge duties properly\" and \"personal immorality\" as defined in the Rules. ", "The was required to make such enquiry as was appropriate, and thereafter to forward its findings, together with the views of an assessor co-opted by the members of the , to the Governor with its recommendations with regard to punishment. ", "Rule 10(1) declared that the Governor was not bound to consult on the 's recommendations, and that he \"shall pass an order of punishment\" in the terms recommended by the subject to the proviso that he could, for sufficient reason, award a lesser punishment than that so recommended. ", "5. On the receipt of the report of the enquiry concerning the petitioner the Inspector-General of Police forwarded the proceedings to the Government and the Governor then referred the matter to a Tribunal appointed under the above-mentioned Rules (to which it is convenient to refer as the Disciplinary Rules). ", "The framed three charges against the petitioner alleging that he had been guilty of personal immorality, of corruption and of failure to discharge his duties properly. It came to the conclusion that the first and third charges had been proved, and that the petitioner was guilty of corruption in respect of two of the thirty-two items which formed the subject of the second charge. The by an order made on the 4-2-1950, recommended that the petitioner be dismissed, from the service and be paid one-fourth his salary during the period of suspension. ", "6. The petitioner was thereafter called upon to show cause against the action proposed to be taken against him. He submitted a representation to the Governor, but the latter by an order which was communicated to the petitioner on the 5-12-1950, directed that he be dismissed from the police force. The order communicated to the petitioner so far as it is relevant, was in the following terms: ", "\"The Governor has considered your explanation and is of the opinion that you have not been able to clear your conduct. The Governor has therefore under the provisions of Rule 10(1) of the U. P. Disciplinary Proceedings (Administrative Tribunal) Rules, 1947, ordered your dismissal from the force with effect from the date on which this order is communicated to you\". ", "The petitioner contends that his dismissal is illegal and he prays for the issue of a writ in the nature of 'certiorari' quashing the order of the Governor sent to him on 5-12-1950. ", "7. The argument for the petitioner is a threefold one. ", "In the first place, it is contended that the petitioner could be dismissed only by an order made by the Inspector-General or by a Deputy Inspector-General of Police; the Governor, it is said, had no power to order his dismissal either under the Disciplinary Rules, or otherwise; secondly, it is argued that the Disciplinary Rules are invalid and, thirdly, it is said that the failed to comply with the Disciplinary Rules and the procedure followed by it in the course of its enquiry was contrary to the principles of natural justice. ", "8. The argument for the respondents is that the petitioner held his office at the pleasure of the Governor subject only to the provisions of Article 311(2) of the Constitution, and that the order of dismissal was an administrative order with which this cannot interfere. In any case, it is contended that the Disciplinary Rules were rules validly made under Section 7 of the Police Act and that there was no substantial deviation by the from the procedure prescribed by the Disciplinary Rules. ", "9. In England the tenure of office of a servant of the Crown is regulated by the rule of the common law that -- ", "\"Unless in special cases where it is otherwise provided, servants of the hold their office during the pleasure of the ; not by virtue of any special prerogative of the but because such are the terms of their engagement, as is well understood throughout the public service.\" ", " v. ', 1895 A. C. 229 at p. 234 (A). If the terms of service in a particular case arc inconsistent with such an implied condition the 's power to dismiss at pleasure is restricted or excluded, as in -- ' v. ', 1896 AC 575 (B), where such was held to be the effect of certain provisions of the New South Wales Civil Service Act of 1884, and in -- ' v. The King', 1934 A. C. 176 at p. 178 CO, where it was held that the terms of an appointment which prescribed its period and provided expressly that is could be terminated \"for cause\" excluded any implication of a power to dismiss at pleasure. ", "10. In India the common law rule has been replaced by statutory provision. Section 96B(1) , Government of India Act, 1919, provided that -- ", "\"Subject to the provisions of this Act, and of the rules made thereunder, every person in the civil service of the in India holds office during His Majesty's pleasure.\" ", "This section in express terms states that office is held at pleasure; \"There is, therefore,\" said in -- ' ', AIR 1937 P. C. 31 CD), \"no need for the implication of this term and no room for its exclusion\". ", "This provision was replaced in the Government of India Act, 1935, by Section 240(1) which reads as follows : ", "\"240 (1). Except as expressly provided by this Act, every person who is a member of a civil service of the in India, or holds any civil post under the crown in India, holds office during His Majesty's pleasure\". ", "(See also Sub-section (3) of Section 257 which refers to \"the rule of law that, except as otherwise provided by statute, every person employed under the holds office during His Majesty's pleasure\". ", "The corresponding provision in the Constitution is, of course, Article 310(1) which provides that -- ", "\"310(1). Except as expressly provided by this Constitution, every person who is a member of a defence service or of a civil service of the or of an all-India service or holds any post connected with defence or any civil post under the holds office during the pleasure of the President, and every person who is a member of a civil service of a or holds any civil post under a holds office during the pleasure of the Governor or, as the case may be, the Rajpramukh of the .\" ", "11. It is thus to be observed that in India the paramount power of the under the 1935 Act and of the President, Governor, or . as the case may be, under the Constitution, is subject, and subject only, to such exceptions as are expressly provided by the Act or the Constitution itself. ", "12. The 1935 Act expressly provided that the would not have power to dismiss at pleasure the holders of certain civil posts, for example (S. 220 (2)); and it further expressly provided that the 's exercise of its power to dismiss at pleasure was subject to the qualification or restriction to be found in Sub-section (3) of Section 240 . ", "As a condition precedent to the dismissal of a civil servant, the was bound to afford that servant a reasonable opportunity for showing cause against the action proposed to be taken against him: -- 'High Commr. for ', AIR 1948 PC 121 (E). Provision for the same exceptions to the general rule is expressly made in the Constitution in Arts 217 (1) and 311 (2). ", "13. The argument for the petitioner is that Section 243 of the 1935 Act constitutes a further express provision which excludes the power of the to dismiss him; and that it has conferred upon him a right or privilege which by virtue of Section 6 of the General Clauses Act operates, after the commencement of the Constitution, as a bar to his dismissal by the Governor. ", "14. Section 243 reads as follows: ", "\"243. Notwithstanding anything in the foregoing provisions of this Chapter, the conditions of service of the subordinate ranks of the various police forces in India shall be such as may be determined by or under the Acts relating to those forces respectively.\" ", "It is convenient also to refer at this stage to Section 7 of the Police Act, for it is the petitioner's contention that the petitioner can be dismissed only by one of the officers named therein. ", "That section (which was amended by the Government of India (Adaptation of Indian Laws) Order, 1937, and by the Adaptation of Laws Order, 1950) is now, so far as is relevant for the present purpose, in these terms: ", "\"7. Subject to the 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 Inspector-General, Assistant Inspectors-General and District Superintendents of Police may at any time dismiss, suspend or reduce any police officer of the subordinate ranks whom they think remiss of negligent in the discharge of his duty, or unfit for the same.\" ", "15. The plain meaning of Section 243 of the 1935 Act appears to be this, that if with regard to the conditions of service of the subordinate ranks of the police force (as determined by or under the Police Act ) there is a conflict between such conditions and the provisions of Sections 240 , 241 or 242, the former will prevail. In other words, it is only to the extent to which the conditions of service of such police officers are inconsistent with the provisions of those sections that the operation of the latter will be excluded. ", "Now Section 7 of the Police Act provides that (subject to Article 311 and to such rules as the State Government may make) certain specified officers may dismiss a police officer of the subordinate ranks. There is nothing in the Act which touches on the power of the to dismiss a police officer and nothing which is inconsistent therewith; on the other hand Rule 479(a) of the Police Regulations, which is a rule made under Section 7 of the Act, contains an express reservation of the Governor's powers of punishment with reference to all officers. The power vested by Section 7 in the Inspector-General and certain other officers to dismiss subordinate ranks of the police force is not, in our opinion, a delegation to them of the 's power of dismissal at all but is a separate statutory power which is neither a substitute for nor restricts the constitutional power of the to dismiss its servants at its pleasure. ", "This we think is the effect of the case of -- ', AIR 1949 PC 112 (P), where held that the only provisions of Chap. 2 to which the introductory words of Section 243 were referable in relation to conditions of service were Sub-sections (2) and (3) of Section 240 , namely provisions corresponding to Article 311 Clauses (2) and (1) of the Constitution. ", "16. We are of opinion, therefore, that the pro-visions of Section 243 did not affect the power of the Governor to dismiss a police officer of the subordinate ranks at pleasure, subject only to the requirements of Section 240(2) . Putting on one side for the moment the question of the effect of Article 320 , we are also of opinion that under the Constitution the Governor has the power, subject to the provisions of Article 311(2 ), to dismiss at pleasure a police officer of the subordinate ranks. ", "17. It is however contended that although the, petitioner was in fact dismissed by the Governor, the latter did not act in the exercise of his discretion under Article 310 but in accordance with the advice of the under Clause 10(1) of the Disciplinary Rules. ", "To this argument there are we think two answers. In the first place it is not in dispute that the petitioner was afforded a reasonable opportunity of showing cause against the action proposed to be taken against him as is required by Article 311(2 ), and that he did show cause. The letter communicating the Governor's decision to the petitioner, which we have quoted earlier in this judgment, makes it clear that the Governor was satisfied both as to the correctness of the conclusion reached by the and as to the propriety of the sentence. On the facts of this particular case, it cannot, we think, be said that the Governor merely accepted without question the opinion of the ; he did not make the order of dismissal because he considered he had no alternative, but because he approved of the recommendation made to him by the . ", "In our opinion, the Governor exercised his discretion in ordering the dismissal of the petitioner; we have held that he had the power to issue such an order, and we think it not to be material that he purported to act under Rule 10(1) of the Disciplinary Rules. ", "18. In the second place, in our judgment, it, makes no difference whether the Governor in arriving at his decision acted on the advice of the or on an independent examination of the facts. Subject to the provisions of the Constitution the petitioner held his office at the Governor's pleasure. The Governor has signified his pleasure; the considerations which induced him to do so are not in our judgment justiciable. ", "19. The Governor's power to dismiss at pleasure is subject only to the express provisions of the Constitution. Power is conferred upon the Governor by Article 309 to make rules regulating the conditions of service of civil servants of , but such power is subject, 'inter alia', to the provisions of Article 310 , and no rules can be made which fetter or restrict his power to dismiss at pleasure. We find ourselves in agreement, if we may say so with respect, with the views of , on this point in -- 'Mrs. ', AIR 1952 Madh-B 105 (G). The Disciplinary Rules were made prior to the commencement of the Constitution, and assuming they were validly made they can, in our opinion, have no greater effect or stand on a higher footing than rules made by the Governor under Article 309. These rules (except Rule 10(1) ) are in our opinion administrative rules, and the contravention of their provisions will not confer upon the petitioner a cause of action. ", "In these circumstances, we do not consider it necessary to express an opinion on the allegations made by the petitioner as to the conduct of the enquiry by the , but as we pointed out in -- ' case', Civil Misc. No. 7717 of 1951 which was argued at the same time, the fact that we do not do so must not be taken to mean that such provisions as to enquiry as are contained in the Rules should not be scrupulously observed. ", "20. The question remains whether it was necessary for the Governor to have consulted before dismissing the petitioner. ", "Article 320 , Clause (3) (c) of the Constitution, so far as it is relevant, provides that \" ....shall be consulted ", "(c) on all disciplinary matters affecting a person serving under .... in a civil capacity including memorials or petitions relating to such matters;\" ", "This clause is subject to a proviso that \"..... The Governor may make regulations specifying the matters in which either generally, Or in any particular class of case or in any particular circumstances, it shall not be necessary for to be consulted.\" ", "Clause (5) of the same Article further provides that all regulations made by a Governor under Clause (3) must be laid for not less than fourteen days before the or each of the Legislature of the State, as the case may be, and shall be subject to such modifications as the or s of the Legislature may make during the session in which they are so laid. ", "21. Rule 10(1) of the Disciplinary Rules provides that the Governor \"shall not be bound to consult on the 's recommendations.\" This provision was made under Section 266(3) , Government of India Act, 1935, which is in substantially the same terms as Clause (3) of Article 320. In ' case (H)' it was not in dispute that, prior to the commencement of the Constitution, Rule 10(1) of the Disciplinary Rules was a valid and effective provision in the case of a civil servant who was not a police officer of the subordinate ranks, and we held that the provision continued to be valid and effective after the Constitution came into force. ", "22. The case of a police officer of the subordinate ranks, such as the petitioner, stands upon a somewhat different footing; for Sub-section (4) of Section 266 of the Government of India Act provides that nothing in that section shall require to be consulted in the case of the subordinate ranks of the various police forces in India as respects any of the matters mentioned in paragraphs (a), (b) and (c) of Sub-section (3) of that section. Paragraph (c) of Sub-section (3) is similar in terms of Sub-clause (c) of Article 320(3) of the Constitution. Rule 10(1) was therefore, so far as the case of the petitioner was concerned, redundant and it assumed importance only upon the coming into force of the Constitution, for the latter contains no provision cot-responding to Section 266(4) of the 1935 Act. ", "We do not think that the fact that the Rule was merely superfluous as regards the case of a particular class of government servants prior to the commencement of the Constitution makes it a Rule which is invalid as regards that class after the Constitution came into force. The position prior to the Constitution was that consultation with was made unnecessary by Section 266(4) and by the Rule. The Constitution repealed the section but it did not in our opinion affect the validity of the rule; and it was not, therefore, in our view necessary for the Governor to consult prior to the dismissal of the petitioner, ", "23. We hold therefore that this position fails. It is accordingly dismissed with costs, which we assess at two hundred and fifty rupees."], "relevant_candidates": ["0000070419", "0000131825", "0000134248", "0041134719"]} {"id": "0001681739", "text": ["PETITIONER: SIR CHUNILAL V. MEHTA AND SONS, LTD. Vs. RESPONDENT: LTD. DATE OF JUDGMENT: 05/03/1962 BENCH: , J.R. BENCH: , J.R. SINHA, P.(CJ) KAPUR, J.L. HIDAYATULLAH, M. , J.C. CITATION: 1962 AIR 1314 1962 SCR Supl. (3) 549 CITATOR INFO : F 1963 SC 361 (8) RF 1979 SC 798 (9) ACT: Appellate Jurisdiction of--Appeal against decree of affirmance--Substantial question of law--Construction of agreement, if such a question--Breach of contract--Liquidated damages--Constitution of India, Art. 133(1). HEADNOTE: The appellants were appointed managing agents of the respondents for 21 years. Under cl. 10 of the agreement the appellants were entitled to a remuneration equal to 10% of the gross profits of the respondents subject to a minimum of Rs. 6,000 per month. Clause 14 provided that if the agree- ment was terminated otherwise in accordance with the provi- sions thereof the appellants would be entitled to liquidated damages \"of not less than Rs. 6,000\" per month for the unexpired portion of the agreement. The respondent wrong- fully terminated the agreement before the expiry of the stipulated period. The appellants filed a suit for recovery of damages for breach of contract on the basis of 10% of the gross profits of the respondents. The trial judge granted a decree for Rs. 2,34,000 calculating the amount at Rs. 6,000 per month. On appeal by the appellants affirmed the decree. The appellants applied 'to for a certificate of fitness for appeal to the but it declined to grant the same on the ground that though the question involved in the case relating to the interpretation of the agreement was a question of law it was not a substantial question of law as required by Art. 13(1) of the Constitution. Held, that the case involved a substantial question of law and the appellants were entitled to the certificate as of right. A substantial question of law is one which is of general public importance or which directly and substantially affects the rights of the parties and which have not been finally settled by the , or or which is not free from difficulty or which calls for discussion of alternative views. The question involved in the present case as to the construction of the agreement was not only one I of law but' it was neither simple nor free from doubt and was a substantial question of law within the meaning of Art. 133(1). 550 .,(1948) I.Bom. L. R. 744 ; v. Deputy Commissioner of Partapgarh, (1927) 54 1. A. 126 and v. , f. L. R. (1949) Nag. 224, referred to. . 1952 Mad. 264, approved. Held, further that upon a proper construction of cl. 14 of the agreement the appellants were entitled to damages at the rate of Rs. 6,000 per month only. The words \"not less than Rs. 6,000\" in cl. 14 could not be construed as meaning 10% of the gross profits as provided in cl. 10. When in cl. 14 the parties named a sum of money to be paid as liquidated damages, it excluded the right to claim an unascertained sum as damages. JUDGMENT: ", "CIVIL APPELLATE JURISDICTION :Civil Appeal No. 417 of 1957. Appeal by special leave from the judgment and decree dated March 14, 1956, of in Appeal No. 94 of 1955. ", ", , , and , for the appellants. ", ", Attorney General of India, , for the respondent. ", " and , for the Intervener. 1962. March 5. The Judgment of the Court was delivered by MUDHOLKAR, J.-This is an appeal by special leave against the Judgment of Bombay in an appeal from the judgment of a single Judge of that Court. The claim in appeal before was for about 26 lakhs of rupees. Being aggrieved by the decision of , the appellant applied for a certificate under Art. 133(1)(a) of the Constitution. The judgment of in appeal was in affirmance of the judgment of the learned single Judge dismissing the appellant's suit for damages and therefore, it was necessary for the appellant to establish that a substantial question of law was involved in the appeal. On behalf of the appellant it was contended that the question raised concerned the interpretation to be placed on certain clauses of the managing agency agreement upon which their claim in the suit was founded and that as the interpretation placed by the appeal court on those clauses was erroneous and thus deprived them of the claim to a substantial amount the matter deserved to be certified by under Art. 133(1)(a) of the Constitution. The learned Judges dismissed the application without a judgment apparently following their previous decision in . (1). The appellants, therefore, moved this Court under Art. 136 of the Constitution for grant of special leave which was granted. In the application for special leave the appellant had raised a specific contention to the effect that the view taken by with regard to the application for certificate under Art. 133 (1) ", "(a) of the Constitution was wrong, that the appellant was entitled to appeal to this Court as a matter of right and that while considering the appeal this question should also be decided. The appellant pointed out that the view taken by on the point as to what is a substantial question of law runs contrary to the decision of in v. Deputy Commissioner of Partabgarh (2) and the decision of some High Courts in India and that therefore, it is desirable that this Court should pronounce upon the question in this appeal and set the matter at rest. We think that it is eminently desirable that the point should be considered in this appeal. ", "It is not disputed before us that the question raised by the appellant in the appeal is one of law because, which the, appellant is challenging is the interpretation placed upon certain clauses of the (1) (1948) L. Bom. L.R. 744. ", "(2) (1927) 54 I.A. 126, 128. ", "552 ", "managing agency agreement which are the foundation of the claim in suit. Indeed it is well settled that the construction of a document of title or of a document which is the foundation of the rights of parties necessarily raises a question of law. ", "The next question is whether the interpretation of a document of the kind referred to above raises a substantial question of law. For, Art. 133(1) provides that where the judgment, decree or final order appealed from affirms the decision of the court immediately below in any case other than a case referred to in sub-cl. (c) an appeal shall lie to this Court if certifies that the appeal involves some substantial question of law. To the same effect are the provisions of s. 110 of the Code of Civil Procedure. In the old the view was taken that a substantial question of law meant a question of general importance. Following that view its successor, , refused to grant a certificate to one whose appeal it had dismissed. The appellant, therefore, moved for special leave on the ground that the appeal raised a substantial question of law. granted special leave to the appellant and while granting it made the following observation in their judgment: ", "\"Admittedly here the decision of the affirmed the decision of the immediately below, and, therefore, the whole question turns upon whether there is a substantial question of law. There seems to have been some doubt, at any rate in the old of Oudh, to which the present succeeded, as to whether a substantial question of law meant a question of general importance. Their Lordships think it is quite clear and indeed it was conceded by Mr. that that is not the meaning, but that \"substantial question of law\" is a substantial question of law as between the parties in the ease invol- ved.\" ", "Then their Lordships observed that as the case had occupied for a very long time and on which a very elaborate judgment was delivered the appeal on its face raised as between the parties a substantial question of law. This case is reported in v. Deputy Commissioner of Partabgarh(1). What is a substantial question of law as between the parties would certainly depend upon the facts and circumstances of every case. Thus for instance, if a question of law bad been settled by the highest court of the country the question of law however important or difficult it may have been regarded in the past and however much it may affect any of the parties would cease to be a substantial question of law. Nor again, would a question of law which is palpably absurd be a substantial question of law as between the parties. , however, in their earlier decision already adverted to have not properly appreciated the test laid down by for ascertaining what is a substantial question of law. Apparently the judgment of was brought to their notice though they do not make a direct reference to it, they have observed as follows: ", "\"The only guidance that we have had from is that, substantial question is not necessarily a question which is of public importance. It must be a substantial question of law as between-the parties in the case involved. But hero again it must not be forgotten that what is contemplated is not a question of law alone; it must be a sub- stantial question. One can define it nega- tively. For instance, if there is a well established principle of law and that principle is (1)(1927) 54 1. A. 126, 128, applied to a given set of facts, that would certainly not be a substantial question of law. Where the question of law is not well settled or where there is some doubt as to the principle of law involved, it certainly would raise a substantial question of law which would require a final adjudication by the highest .\" ", "One of the points which the learned judges of had to consider in this case was whether the question of construction to be Placed upon a decree was a substantial question of law. The learned Judges said in their judgment that the decree was undoubtedly of a complicated character but even so they refused to grant a certificate under s. 110 of the Code of Civil Procedure for appeal to because the construction which the was called upon to place on the decree did not raise substantial question of law. They have observed that even though a decree may be of a complicated character what the has to (lo is to look at its various provisions and draw its inference therefrom. Thus according to the learned Judges merely because the inference to be drawn is from a complicated decree no substantial question of law would arise. Apparently in coming to this conclusion they omitted to attach sufficient weight to the view of that a question of law is \"a substantial question of law\" when it affects the rights of the parties to the pro- ceeding. Further the learned Judges seem to have taken the view that there should be a doubt in the mind of the as to the principle, of law involved and unless there is such doubt in its mind the question of law decided by it cannot be said to be \"a substantial question of law\" so as to entitle a party to a certificate under a. 1 10 of the Code of Civil Procedure. It is true that they have not said in so many words that such a doubt must be entertained by the itself but that is what we understand their judgment to mean and in particular the last sentence in the portion of their judgment which we have quoted above. As against the view taken by there are two decisions of the High s in India to which reference was made before us. One is v. (1). In that case applying 's decision the High held that a question of law is substantial as between the parties if the decision turns one way or another on the particular view taken of the law. If the view taken does not affect the decision then it cannot be substantial as between the parties ; but it would be otherwise if it did, even though the question may be wholly unimportant to others. It was argued before the High on the basis of certain decisions that no question of law can be substantial within the meaning of s. 110 of the Code of Civil Procedure unless the legal principles applied in the case are not well defined or unless there can be some reasonable divergence of opinion about the correctness of the view taken and the case involves, a point of law such as would call for fresh definition and enunciation. Adverting to those cases , (as he then was) whom Delivered the judgment of the observed as follows : ", "\"In the first case cited, it was also held that a misapplication of principles of law does not raise any substantial question of law so as to attract the operation of s. 1 ", "10.......... ", "There can be no doubt that that is a view which has been held by various in India, but the decision cited' omit to consi- ", "der two decisions of' their Lordships of on this very point which. in our (1) 1. L. R. (1949) Nag. 224 opinion, very largely modify the views taken in the cases cited and which of course it is impossible for us to ignore.\" (p. 226) Referring to case the learned Chief Justice observed as follows : ", "\"In the Lucknow case the only question was whether the defendant there obtained an absolute interest or a limited interest under a will. That again was a question which was of no interest to anyone outside the parties to the suit. Nevertheless, their Lordships considered in both cases that the questions were substantial questions of law because they were substantial as between the parties. We can only consider this to mean that a question of law is substantial as between the parties if the decision turns one way or another on the particular view taken of the law. If it does not affect the decision then it cannot be substantial as between the parties. But if it substantially affects the decision then it is substantial as between the parties though it may be wholly unimportant to others.\" (p. 228) It maybe that in the case before it, was justified in granting certificate because of the points involved was the construction of a deed of compromise and had interpreted that deed differently from the court below. But it seems to us that some of the obser- ", "vations of , are a little too wide. We are prepared to assume that the learned Chief Justice did not intend to say that where a question of law raised is palpably absurd it would still be regarded as a substantial question of law merely because it affects the decision of the case one way or the other. 'But at the same time his observation that the view taken in the cases cited before him requires to be modified in the light of the decision would imply that a question of law is deemed to be a substantial question of law even though the legal principles applicable to the case are well defined and there can be no reasonable divergence of opinion about the correctness of the view taken by . If we, have understood the learned Chief Justice right, we think that he has gone further than was warranted by the decision of the in case (1). The other case relied upon was (2). In that case the test of the kind suggested by 'C.J., was rejected on the ground that logically it would lead to the position that even a palpably absurd plea raised by a party would involve a substantial question of law because the decision on the merits of the case would be directly affected by it. What was, however, said was that when a question of law is fairly arguable, where there is room for difference of opinion on it or where the thought it necessary to deal with that question at some length and discuss alternative view, then the question would be a substantial question of law. On the other hand if the question was practically covered by the decision of the highest court or if the general principles to be applied in determining the question are well settled and the only question was of applying those principles to the particular fact of the case it would not be a substantial question of law. ", "We are in general agreement with the view taken by and we think that while the view taken by. is rather narrow the. one taken by the former is too wide. The proper test for determining whether a question of law raised in the case is substantial would, in our opinion, be whether it is of general public importance or whether it (1) (1927) 54 I.A. 126. 128. ", "(2) I.L.R. 1952 Mad. 264. ", "558 ", "directly and substantially affects the rights of the parties and if so whether it is either an open question in the sense that it is not finally settled by this Court or by or by or is not free from difficulty or calls for discussion of alternative views. If the question is settled by the highest Court or the general. principles to be applied in determining the question are well settled and there is a mere question of applying those principles or that the plea raised is palpably absurd the question would not be a substantial question of law. Applying the tests it would be clear that the question involved in this appeal, that is, the construction of the agreement is not only one of law but also it is neither simple nor free from doubt. In the circumstances we have no hesitation in saying that was in error in refusing to grant the appellant a certificate that the appeal involves a substantial question of law. It has to be borne in mind that upon the success or the failure of the contention of the parties, they stand to succeed or fail with respect to their claim for nearly 26 lakhs of rupees. Now as to the merits. The relevant facts may be briefly stated. , Bombay were appointed Managing Agents of the respondent company for a term of 21 years by an agreement dated June 15, 1933. By a resolution passed by the respondent company in October 1945, , were permitted to assign the benefits of the aforesaid.agreement to the present appellant, Sir Ltd. On April 23, 1951, of the Company terminated the agreement of 1933 and passed a resolution removing the appellant as Managing Agents on April 23, 1951. The appellant thereupon filed a suit on the original side of claiming Rs. 50 lakhs by way of damages for wrongful termination of the agreement. Eventually with the permission of the Court it amended the plaint and claimed instead Rs. 28,26,804/-. The company admitted before the Court that the termination of the appellants' employment was wrongful and so the only question which the learned Judge before whom the matter went had to decide was the quantum of damages to which the appellant was entitled. This question depended upon the construction to be placed upon cl, 14 of the agreement. ", "That clause runs thus \"In case the Firm shall be deprived of the office of Agents of the Company for any reason or cause other than or except those reasons or causes specified in Clause 15 of these presents the Firm shall be entitled to receive from the Company as compensation or liquidated damages for the loss of such appointment a sum equal to the aggregate amount of the monthly salary of not less than Rs. 6,000/- which the Firm would have been entitled to receive from the Company, for and during the whole of the then unexpired portion of the said period of 21 years if the said Agency of the Firm had not been determined.\" ", "In order to appreciate the arguments advanced before us it would, however, be desirable to reproduce the two earlier clauses cls. 10 and 12. They run thus ", "10.The Company shall pay to the Firm by wry of remuneration for the services to be performe d by the Firm as such Agents of the Company under this Agreement a monthly sum of Rs. ", "6,000/- provided that if at the close of any year it shall be found that the total 0remuneration of the firm received in such year shall have been less than 10 per cent of the gross profits of the for such year the shall pay to the Firm in respect of such year such additional sum by way of remuneration as will make the total sum received by the Firm in and in respect of such year equal to 10 per cent of the gross profits of the in that year. The first payment of such remuneration , shall be made on the first day of August 1933. ", "\"12. The said monthly remuneration or salary shall accrue due from day to day but ,shall be payable by the company to the Firm monthly, on the first day of the month immediately succeeding the month in which it shall have been earned.\" ", "The learned trial judge upon the interpretation placed by him on el. 14 awarded to the, appellant a sum of Rs. 2,34,000/-, calculating the amount it Rs. 6,000/- p.m. for the unexpired period of the term of the agreement and also awarded interest thereon. Now according to Mr. for the appellants, the interpretation placed upon el. 14 by the trial judge and is erroneous in that it makes the words \"not less than\" in el. 14 redundant. Learned counsel contends that on a proper construction of el. 14 the appellants are entitled to compensation computed on-the basis of the total estimated remuneration under cl. 10 for the unexpired period. Under that clause, he contends, the appellants are entitled to 10% of the profits of the company subject to a minimum of Rs. 6,000/- p.m. Alternatively learned counsel contends that el. 14 is not exhaustive of the appellant's right to compensation and the right to be compensated in respect of contingent remunera- ", "561 ", "tion based on 10% of profits is left untouched by that clause. ", "A perusal of el. 14 clearly shows that the parties have themselves provided for the precise amount of damages that would be payable by the Company to the Managing Agents if the Managing Agency agreement was terminated before the expiry of the period for which it was made. The clause clearly states that the Managing Agent shall receive from the Company as compensation or liquidated damages for the loss of appointment a sum equal to the aggregate amount of the monthly salary of not less than Hs. 6,000/- for and during the whole of the unexpired portion. of the term of Agency. Now, when parties name a sum of money to be paid as liquidated damages they must be deemed to exclude the right to claim an unascertained sum of money as damages. The contention of learned counsel is that the words \"not less than\" appearing before \"Bs. 6,000/-\" in cl. 14 clearly bring in el. 10 and, therefore, entitle the appellant to claim 10% of the estimated profits for the unexpired period by way of damages. But if we accept the interpretation, it would mean that the parties intended to confer on .the Managing Agents what is in fact a right conferred by a. 73 of the Contract Act and the entire clause would be rendered those. Again the right to claim liquidated damages is enforceable under is. 74 of the Contract Act and where such a right is found to exist no question of ascertaining damages really arises. Where the parties have deliberately specified the amount of liquidated damages there can be no presumption that they, at the same time, intended to allow the party who has suffered by the breach to give a go-by to the sum specified and claim instead a sum of' money which was not ascertained or ascertainable at the date of the breach. Learned counsel contends that upon this view the words \"not less than\" would be rendered otiose. In our opinion these words, as rightly-pointed out by , were intended only to emphasise the fact that compensation will be computable at an amount not less than Rs. 6,000 p.m. Apparently, they thought it desirable to emphasise the point that the amount of Rs. 6,000 p.m. was regarded by' them as reasonable and intended that it should not be reduced by the court in its discretion. ", "Mr. argued that what the appellants were entitled to was remuneration and remuneration meant nothing but salary. The two words, according to him, have been used interchangeably in the various clauses of the agreement. If, therefore, salary in el. 14 is the same as remuneration, which according to him it is, then as indicated in el. 10 it would mean 10% of the gross profits of the Company subject to a minimum of Rs. 6,000/-p.m. In support of the argument that the two words wherever used in the agreement mean one and the same thing learned counsel relies on cl.12 which says that the monthly remuneration or salary shall accrue due from day to day. Then undoubtedly the two words clearly mean the same thing. But from a perusal of the clause it would appear that remuneration there could mean nothing other than Rs.6,000/-p.m. For, that clause provides that the amount shall accrue from day to day and be payable at the end of the month immediately succeeding the month in which it had been earned. Now, whether a company had made profits or not and if so what is the extent of the profits is determinable only at the end of its accounting year. To say, therefore, that the remuneration of 10% of the gross profits accrues from day to day and is payable every month would be to ignore the nature of this kind of remuneration. Therefore, in our opinion, when the remuneration and salary were equated in el. 12 nothing else was meant but Rs. 6,000/-and when the word salary was used in el. 14 we have no doubt that only that amount was meant and no other. It may be that under el. 10 the appellant was entitled to additional remuneration in case the profits were high upto a limit of 10% of the gross profits. That was a right to claim something over and above Rs.6,000/-and could be characterized properly as additional remuneration and not fixed or normal remuneration which alone was apparently in the minds of the parties when they drew up el. 14. In our opinion, therefore, was right in the construction placed by it upon the clause. Coming to the alternative argument of Mr. , we appreciate that the right which the appellant had of claiming 10% of profits was a valuable right and that but for cl. 14 he would have been (entitled in a suit to claim damages estimated at 10% of the gross profits. We also appreciate his argument that a party in breach should not be allowed to gain by that breach and escape liability to pay damage to a very much larger sum than the compensation payable under cl. 14 and that we should so interpret cl. 14 as to keep alive that right of the appellants. Even so, it is difficult, upon any reasonable construction of cl. 14, to hold that this right of the appellants were intended by the parties to be kept alive. If such were the intentions of the parties clearly there was no need whatsoever of providing for compensation in cl. 14. If that clause had not been there the appellant would indeed have been entitled to claim damages at the rate of 10% for the entire period subject to minimum of Rs. 6,000/- p.m. On the other hand it seems to us that the intention of the parties was that if the appellants were relieved of the duty to work as Managing Agent and to put in their own money for carrying on the duties of managing agents they should not be entitled to get anything more than Rs. 6,000/- p.m. by way of compensation. Clause 14 as it stands deals with one subject only and that is compensation. It does not expressly or by necessary implication keep alive the right to claim damages under the general law. By providing for compensation in express terms the right to claim damages under the general law is necessarily excluded and, therefore, in the face of that clause it is not open to the appellant to contend that that right is left unaffected. There is thus no substance in the alternative contention put forward by the learned counsel. ", "Accordingly we affirm the decree of and dismiss the appeal with costs. ", "Appeal dismissed."], "relevant_candidates": ["0000257092", "0000823117"]} {"id": "0001706364", "text": ["CASE NO.: Appeal (civil) 4674 of 2004 PETITIONER: & . RESPONDENT: . DATE OF JUDGMENT: 02/08/2004 BENCH: & . JUDGMENT: ", "J U D G M E N T (arising out of SLP (C) No. 24449 of 2002) With Civil Appeal No. 4677 /2004 @ SLP (C) No.23635/02, Civil Appeal No. 4676 /2004 @ SLP (C) No.24292/02, Civil Appeal No. 4675 /2004 @ SLP (C) No. 533/03, Civil Appeal No. 4678/2004 @ SLP (C) No. 834/03, Civil Appeal No. 4679 /2004 @ SLP (C) No. 2186/03 And Writ Petition (C) No. 173 of 2003 SRIKRISHNA, J. ", "Leave granted in the special leave petitions and the writ petition is admitted. ", "These appeals and writ petition arise from different areas and, though marginally differing on facts, raise substantially similar issues of law. They can, therefore, be conveniently disposed of by a common judgment. The common issue raised for consideration of this in all these cases is the validity of notifications issued by under Section 7(iv) of the Prevention of Food Adulteration Act, 1954 (hereinafter referred to as the 'Act') by which the manufacture, sale, storage and distribution of pan masala and gutka (pan masala containing tobacco) were banned for different periods. We shall take the facts in the civil appeal arising out of special leave petition No. 24449 of 2002 as typical of the cases. ", "Facts: ", "Civil Appeal arising out of SLP(C) No. 24449 of 2002 The appellants manufacture gutka within the state of Maharashtra, which is stored in convenient godowns and sold both within and outside the state of Maharashtra. By a notification dated 23rd July, 2002 issued by , the manufacture, sale, storage and distribution of pan masala and gutka (pan masala containing tobacco) were banned for a period of five years with effect from 1st August, 2002. The appellants challenged the validity of this notification by a writ petition No. 2024 of 2002 before at Bombay. By its judgment dated 18th /19th September, 2002, the division bench of dismissed the writ petition upholding the validity of the notification. Aggrieved thereby, the appellants challenge the said judgment by the present appeal. ", "Writ Petition No. 173 of 2003: ", "Petitioners Nos. 1 to 5 are associations and cooperative societies of arecanut growers, petitioners Nos. 6 and 7 are engaged in the manufacture and sale of pan masala and gutka in the State of Karnataka. They are aggrieved by a notification dated 27th February, 2002, issued by the competent officer appointed as for the State of Andhra Pradesh under Section 7(iv) of the Act, by which the sale of all brands of pan masala (containing tobacco) and chewing tobacco/ zarda/ khaini under any brand name was prohibited \"in the interest of public health\" in the entire state of Andhra Pradesh with immediate effect. The petitioners also challenge another notification dated 19th November, 2001 issued by the Director for Public Health and Preventive Medicine and State , Government of Tamil Nadu, under Section 7(iv) of the Act directing that no person shall himself or by any person on his behalf, manufacture for sale or store, sell or distribute: (i) chewing tobacco; (ii) pan masala; (iii) gutka, containing tobacco in any form or any other ingredients injurious to health, under whatever name or description in the State of Tamil Nadu. This notification is purported to have been issued in the \"interest of public health\", for a period of five years with effect on and from 19th November, 2001. The third notification which is challenged in the writ petition is the notification dated 23rd July, 2002 issued by the Commissioner of and for the State of Maharashtra. By the said notification, issued purportedly in exercise of the powers under Section 7(iv) of the Act, \"in the interest of public health\", the sale of gutka and pan masala, containing tobacco or not containing tobacco, is prohibited for a period of five years effective from 1st August, 2002. The notification directs that \"no person shall himself or any person on his behalf, shall manufacture for sale or store, sell or distribute gutka or pan masala, containing tobacco or not containing tobacco, by whatever name called. The fourth notification challenged in the writ petition is the notification dated 24th January, 2003 issued by the Directorate of Food and Drugs Administration and for the State of Goa. By this notification, purportedly issued under Section 7(iv) of the Act, the \"sale of gutka and pan masala, containing tobacco or not containing tobacco, by whatever name called,\" is prohibited within the state of Goa and it is directed that \"no person shall himself or any person on his behalf, shall manufacture for sale or store, sell or distribute gutka or pan masala, containing tobacco or not containing tobacco, by whatever name called.\" The prohibition in the notification is made effective from 26th January, 2003. All the four notifications are under challenge. ", "Civil Appeals arising out of S.L.P. Nos. 23635/02, 24292/02, 533/03, 834/03 and 2186/03 The appellants are engaged, inter alia, in the manufacture and trade of pan masala and gutka, pan masala containing tobacco and other allied tobacco products. They sell their products all over India including State of Maharashtra. They have a wide network of dealers through whom their products are sold to the public at large in the state of Maharashtra. They also have operating depots in the state of Maharashtra. The appellants challenge the notification dated 23rd July, 2002, issued by the Commissioner, and for the state of Maharashtra. by its common judgment dated 18th/19th September, 2002 negatived the challenge. ", "Civil Appeal arising out of SLP No. 24292 of 2002 The appellant carry on the business of manufacture and sale of pan masala, gutka and other tobacco related items. Aggrieved by the notification dated 19th February, 2002 issued by , State of Andhra Pradesh, prohibiting the sale of pan masala under any brand name with a emblem of gutka, containing tobacco, within the state of Andhra Pradesh, with immediate effect, and the notification dated 27th February, 2002 issued by the same authority which prohibited the sale of all brands of pan masala containing tobacco and chewing tobacco/zarda/khaini under any brand name in the entire State of Andhra Pradesh, with immediate effect, the appellant challenged the validity of both notifications before . The division bench of the high court by its judgment dated 16th August, 2002 dismissed the writ petition. Being aggrieved thereby, the appellant is before this Court. Core Issue: ", "These appeals and the writ petition raise the common issue as to the power of to issue an order of prohibition, whether permanently or quasi-permanently, under Section 7(iv) of the Act. ", "Challenge: ", "The broad grounds of challenge formulated by the appellants/petitioners are as under: ", "1. The Act vests the power to declare a substance as injurious to health only with under Section 23 of the Act and no such power is vested with . ", "2. Each of the manufacturers has been issued a licence to manufacture the banned product by under the provisions of the Act. As long as the conditions stipulated in the licence are fulfilled, and there is no violation of the terms of the licence or the provisions of the concerned statute, it is not open to the state Government, by any administrative order, to prohibit the manufacture of the concerned product undertaken under a licence issued by . ", "3. The power of to frame rules under Section 24 of the Act is extremely narrow and limited to the field which is not covered by Section 23 , the exclusive domain of . ", "4. The Act is concerned with the prevention of adulterated articles of food and not intended to prohibit any article used as food or otherwise. ", "5. The impugned notification dated 23rd July, 2002, issued by the of Maharashtra operates extra territorially, and, to that extent, is ultra vires of the powers of the . ", "6. By enacting the Cigarettes and Other Tobacco Products (Prohibition of Advertisement and Regulation of Trade and Commerce, Production, Supply and Distribution) Act , 2003, (Act 34 of 2003), has evinced its intent to occupy the whole field with regard to prohibition of advertisement and regulation of trade and commerce, production, supply and distribution of tobacco products. While the central legislation prohibits the sale of tobacco products only to persons below age of 18 years, the impugned notification purports to impose a wholesale ban without any qualification. Thus, there is a conflict between the powers exercisable under two central statutes dealing with the same subject and, therefore, provisions of the Act 34 of 2003 must prevail. ", "Legal provisions: ", "In order to appreciate the contentions of the learned counsel, it will be necessary to briefly notice the relevant provisions of the Act. As the preamble of the Act indicates, \"it is an Act to make provision for the prevention of adulteration of food.\" Section 2(ia) defines what is 'adulterated food'. Broadly speaking, the definition covers situations where a food article is sub-standard, or contains injurious ingredients or has become injurious to health by reason of packing or keeping under unsanitary conditions or having become contaminated or is otherwise not fit for consumption. The definition also extends to cases of articles which fall below the prescribed standards of purity or quality. The Act also deals with misbranding of food articles, which is not of concern to us for the present. For the purpose of administration of the Act, any urban or rural area may be declared by or by a notification to be a 'local area' for the purpose of the Act. In relation to such local area, an officer is appointed by or by notification in the Official Gazette to be in-charge of the Health administration in such area with such designation as specified therein and such officer is defined to be by Section 2(viiia) . Section 2(vi) defines ' as the Director of Medical and Health Services or the Chief Officer in-charge of Health administration in a State, by whatever designation he is known, and includes any officer empowered by or , by notification in the Official Gazette, to exercise the powers and perform the duties of under the Act with respect to such local area as may be specified in the notification. Section 7 , upon which most of the arguments turn, needs to be noticed. Section 7 reads as under: ", "\"7. Prohibitions of manufacture, sale, etc., of certain articles of food. - No person shall himself or by any person on his behalf manufacture for sale, or store, sell or distribute - ", "(i) any adulterated food; ", "(ii) any misbranded food; ", "(iii) any article of food for the sale of which a licence is prescribed, except in accordance with the conditions of the licence; ", "(iv) any article of food the sale of which is for the time being prohibited by in the interest of public health; ", "(v) any article of food in contravention of any other provision of this Act or of any rule made thereunder; or ", "(vi) any adulterant. ", "Explanation.-For the purposes of this section, a person shall be deemed to store any adulterated food or misbranded food or any article of food referred to in clause (iii) or clause (iv) or clause (v) if he stores such food for the manufacture therefrom of any article of food for sale.\" ", "Section 22A empowers to give such directions as it may deem necessary to a State Government regarding the implementation of the Act. Section 23 empowers to make rules to carry out the provisions of the Act. In particular, and without prejudice to the generality of the rule making power, the power of includes the one in clause (f). Section 24 of the Act is the section which grants rule making power to . The State Government may, after consultation with the Committee, and subject to the condition of previous publication, thereunder make rules for the purpose of giving effect to the provisions of the Act in matters not falling within the purview of section 23 . Sub section (2) of Section 24 grants power to to make rules with regard to the powers and duties of the different authorities under the Act. Prescription of forms of licences for the manufacture for sale, storage, sale and distribution of articles of food, the conditions subject to which such licences may be issued and the fees payable therefor, analysis of any article of food or matter and provision for further delegation of power by to or the subordinate authorities are the matters covered within this delegated power. Part IX of the Prevention of Food Adulteration Rules, 1955 (hereinafter referred to as the 'Rules') deals with the conditions for sale and licence. Rules 49 and 50 lay down detailed conditions applicable to different types of licences granted for manufacturing of different products used as food articles. ", "In Appendix B there is prescription of definitions and standards of quality of different food articles. Of relevance to us is paragraph A.30 which deals with pan masala. Paragraph A.30 reads thus: \"A.30 PAN MASALA means the food generally taken as such or in conjunction with pan, it may contain- ", "Betelnut, lime, coconut, catechu, saffron, cardamom, dry fruits mulathi, sabermusa, other aromatic herbs and spices, sugar, glycerine, glucose, permitted natural colours, menthol and non- prohibited flavours. ", "It shall be free from added coaltar colouring matter, and any other ingredient injurious to health. ", "It shall also conform to the following standards, namely:- Total ash.-Not more than 8.0 per cent by weight (on dry basis). Ash insoluble in dilute hydrochloric acid.-Not more than 0.5 per cent by weight (on dry basis).\" ", "Significantly, in this specification of standard the prescription is that the article is \"free from added coaltar colouring matter, and any other ingredient injurious to health\". It is also required to conform to the prescribed standard with regard to total ash. ", "As far as the rules made by the State Government are concerned, the Maharashtra Prevention of Food Adulteration Rules, 1962 and the Goa, Daman and Diu Prevention of Food Adulteration Rules, 1982 may be noticed. The relevant Goa rules are as under: ", "\"3. Powers and duties of : (1) The Director of Health Services for the Union Territory of Goa, Daman and Diu being the Chief Officer in charge of in the Union Territory shall be the . ", "(2) shall be responsible for the general superintendence of the administration and enforcement of the Act. ", "(3) shall, for the purpose of giving effect to the provisions of the Act, have control over the Public Health Laboratories maintained by the Government and Local Authorities and , Licensing Authorities, the Public Analyst and Food Inspectors appointed under the Act. ", "(4) may give to such directions as he may consider necessary in regard to any matter connected with the enforcement of the Act and the Rules made thereunder and shall comply with such directions. ", "(5) whenever called upon to do so shall advise the Government in matters relating to the administration and enforcement of the Act. ", "(6)(a) If the Union Territory or any part thereof is visited by, or threatened with any outbreak of any infectious diseases, shall ascertain the cause of such outbreak of the infectious disease. ", "(b) If in the opinion of the outbreak of any infectious disease is due to any article of food, shall take such measures as it shall deem necessary to prevent the outbreak of such disease or the spread thereof. ", "(7) may issue from time to time guidelines for the efficient working of the Act. ", "(8) may from time to time issue guidelines to the Public Analyst for efficient working of the Act. ", "(9) may also have powers to inspect, control and superintend the operation of other functionaries working under the Act viz. , etc. etc. ", "4. Powers and duties of (1) Subject to the provisions of sub-rule (3), shall be responsible for the proper day to day administration and enforcement of the Act and the Rules within its jurisdiction. ", "(2) or Health Officer/Medical Officer authorised by it shall be for local area concerned. ", "(3) or Health Officer/Medical Officer/Food Inspector authorised by it shall have powers to inspect all the establishments engaged in the manufacture, for sale or for distribution of articles of food in respect of which a licence is required under the Act and the Rules. ", "5. Licences : ", "(1) Any person desiring for the manufacture for sale, for the storage, for the sale or for the distribution of articles of food in respect of which a licence is required under Rule 48A and Rule 50 of the Central Rules, shall apply for a licence in Form A to concerned. ", "(2) Any person desiring for the manufacture for sale, for the storage, for the sale or for the distribution of articles of food in a mobile van shall apply in Form B to and if such mobile van is to move in any one or more than one local area to , District of Goa. ", "(3) The applicant shall furnish in the application in Form A detailed information regarding location of the business premises which are intended for the manufacture for sale, for the storage, for the sale or for the distribution of any article of food and in Form B the details about the locality in which, the mobile van is intended to be moved and its registration number issued by . ", "(4) On receipt of such application, shall, if on inspecting the said premises is satisfied that the premises are free from sanitary defects and are in proper hygienic conditions and the applicant complies with other conditions for holding licence, grant the applicant a licence in Form as specified below on payment of fees laid down in the Schedule appended to the rules. ", "(i) Form 'C' in respect of any premises. ", "(ii) Form 'D' in respect of any mobile van. ", "(iii) Form 'E' in respect of any temporary stall. ", "(5) If the information furnished in the application appears to be incorrect or incomplete or if the prescribed fee has not been paid, shall make such enquiry as he considers necessary and after giving the applicant an opportunity of proving the correctness and completeness of the information so furnished, may if he is satisfied that the applicant is eligible for the licence applied for grant or renew the licence. ", "(6) If the articles of food are manufactured, stored or exhibited for sale at different premises situated in more than one local area, separate applications shall be made and a separate licence shall be issued in respect of such premises not falling within the same local area. ", "Provided that the itinerant vendors who have no specified place of business, shall be licensed to conduct business in a particular area within the jurisdiction of . (7) The licensee shall abide by the provisions of the Act and the Rules made thereunder and the conditions of licence granted to him. ", "6. Fees for grant and renewal of licences: ", "The fees to be paid for the grant or renewal of licence shall be as specified in the Scheduled appended to the Rules. ", "7. Validity of licence: ", "A licence granted under these rules shall be valid for the period beginning on the date of its issue and ending on 31st day of March, next following. ", "8. Renewal of licences : ", "A licence granted under the rules may be renewed by on an application made in that behalf, thirty days before the day on which such licence is due to expire and on payment of fees specified in the Schedule. ", "Provided that, if the application for renewal is made after the expiry of the licence but not later than one month from the date of such expiry, the licence may be renewed only on payment of a fee equal to one and half times of the fee payable for the renewal of the licence. ", "9. Conditions for grant or renewal of licences : ", " shall not grant or renew the licence until such officer as may be specified by him by general or special order has inspected the place in respect of which the licence for grant or renewal is applied for and has recommended the grant or renewal of the licence. shall however use his own judgment in granting/renewal of licences.\" ", "Rule 13 deals with the circumstances under which may by order in writing refuse to grant or renew a licence. Rule 14 prescribes the procedure for cancellation or suspension of the validity of a licence. Rule 15 gives a right to appeal to any person aggrieved by an order of passed under rule 13 or rule 14. ", "The relevant rules of the Maharashtra Prevention of Food Adulteration Rules, 1962 are as under: ", "\"3. and its powers and duties - (1) The Director of Public Health for the State of Maharashtra being the Chief Officer-in-charge of in the State of Maharashtra shall be the (hereinafter referred to as the authority). ", "(2) The authority shall be responsible for the general superintendence of the administration and enforcement of the Act. ", "... ", "(6)(a) If the State or any part thereof is visited by, or threatened with an outbreak of any infectious disease, the authority shall ascertain the cause of such outbreak of the infectious disease. ", "(b) If in the opinion of the authority the outbreak of any infectious disease is due to any article of food, the authority shall take such measures as it shall deem necessary to prevent the outbreak of such disease or the spread thereof.\" ", "Rule 5 deals with licences and the manner of suspension or cancellation of licences. ", "Submissions : ", "Ex visceribus actus: ", "The first contention urged on behalf of the appellants is that Section 7 of the Act is not declaratory of the power of any authority, but merely of the consequences of certain acts. The section prohibits the manufacture for sale, store or distribution of (i) any adulterated food; (ii) any misbranded food; (iii) any article of food for the sale of which a licence is prescribed, except in accordance with the conditions of the licence; (iv) any article of food the sale of which is for the time being prohibited by in the interest of public health; (v) any article of food in contravention of any other provision of this Act or of any rule made thereunder; or (vi) any adulterant. Although, Section 2(vi) defines as to who is , there is no corresponding provision in the Act which delineates the powers of . On the other hand, Section 24(2) of the Act empowers to \"define the powers and duties of , local authority and under this Act\". The source of the powers of is to be found only under the rules, if any, made under Section 24(2) of the Act, subject to the restriction that it can be made only \"for the purpose of giving effect to the provisions of this Act in matters not falling within the purview of Section 23 \". Learned counsel for the appellants contend that in view of the nature of the limitations placed on 's power under Section 24(1) , a reading of Sections 23 and 24 would lead to the irresistible conclusion that the powers exercisable by under Section 24 can only be in the field not occupied by Section 23 . As we have already noticed, Section 23(1A)(f) empowers to prescribe rules for prohibiting the sale or defining the conditions of sale of any substance which may be \"injurious to health\" when used as food or restricting in any manner its use as an ingredient in the manufacture of any article of food or regulating by the issue of licences the manufacture for sale of any article of food. Learned counsel, therefore, contend that the power of has to be necessarily found under the rules made by and subject to the limitation that they cannot operate in the field covered by Section 23 . Since Section 23(1A)(f) empowers to make rules for prohibition of any substance which may be injurious to health, it is contended that the state is denuded of such power. There appears to be merit in the contentions of the appellants. Rule 3 of the Maharashtra Prevention of Food Adulteration Rules, 1962 and the corresponding rule in the Goa, Daman & Diu Prevention of Food Adulteration Rules, 1982 suggest that the power given to is only a pro tem power to deal with an emergent situation, such as outbreak of any infectious disease, which may be due to any article of food. In such a contingency, is empowered to take all such action as it deemed necessary to ascertain the cause of such infectious disease and to prevent the outbreak of such disease or the spread thereof. Certainly, such power would include the power to ban \"for the time being\" the sale of such injurious articles of food. Hence, correspondingly Section 7(iv) of the Act provides that no person shall manufacture for sale, or store, sell or distribute \"any article of food the sale of which is for the time being prohibited by in the interest of public health.\" In other words, when a contingency envisaged by Rule 3, or one similar thereto, arises and it becomes necessary for to take immediate steps, is empowered to prohibit \"for the time being\" the concerned injurious article and to take any appropriate step \"in the interest of public health\". ", "On the collocation of the statutory provisions, we are unable to accept the contention of the learned counsel for the States that clause (f) of Section 7 of the Act is an independent source of power. This conclusion of ours is also supported by the legislative history. Prior to the amendment by Act 49 of 1964, with effect from 1.3.1965, clause (iv) of Section 7 read as under: \"Any article of food the sale of which is for the time being prohibited by with a view to preventing the outbreak or spread of infectious diseases.\" ", "Learned counsel for the State Governments contend that as a result of the amendment and the substitution of the words \"in the interest of public health\" for the words \"with a view to preventing the outbreak or spread of infectious diseases\", the legislature has expanded the power of so that it can act to prohibit the sale of any article, the only limitation being that the power exercised is \"in the interest of public health\". It is not possible for us to accept this submission. It is, undoubtedly, true that the intention of in bringing forth the amendment to clause (iv) of Section 7 was to expand the area of operation of the said clause. As originally intended, it was to operate only in the event of a contingency aimed at preventing the outbreak or spread of infectious diseases. This certainly was restricted. There could be several situations in which there may not be any apprehension of outbreak or spread of infectious diseases and yet it may become necessary for the to act by taking appropriate steps to control a situation which has arisen. It is with this view that the prohibition in clause (iv) of Section 7 of the Act was expanded to apply to such contingencies also. It is unfortunate that, despite the amendment made in clause (iv) of Section 7 of the Act, (by Act 49 of 1964) the rules have not been correspondingly updated. Going strictly by the state rules, which actually determine the extent of the power of the , it appears to us that the arguments of the State Governments that this amendment was intended to give a carte blanche to the cannot be accepted. On the contrary, the construction canvassed by the appellants appears to be more reasonable. We are inclined to the view that the power of the state authority, which is discernible under Section 24(2)(a) read with the state rules, operates only for a temporary period during which an emergent situation exists which needs to be controlled. It is not possible to accept the State Governments' contention that clause (iv) of Section 7 of the Act is an independent provision which clothes the with the power to issue an order of ban for a long period. ", "Mr. , learned counsel for the state of Maharashtra, took us through the affidavit filed by the state Government and the voluminous data presented therein by the state to indicate that gutka and pan masala are addictive and, in the long run, deleterious to human health. He also referred to certain scientific reports on the subject by , , part of , and so on. In our view, it is not necessary to make any pronouncement thereupon. Even if we accept that the scientific data supports the view that chewing of pan masala with or without tobacco is injurious to health, the question which remains to be answered is whether in the state has the power of prohibiting the manufacture for sale, or storage, sale or distribution of any article assuming it to be injurious to health. A contrast of the powers of with those of the state Government, with particular reference to the power of to make rules to prohibit the manufacture, sale and distribution of such articles which are injurious to health when used as food, enumerated in clause (f) of sub- section(1A) of Section 23 of the Act, leads us to believe that, even assuming that gutka and tobacco products are injurious to health, the power of their prohibition is only vested with and not with the state . The State (Food) Health authorities have only a limited power of issuing an order of prohibition for a short term while they investigate local problems and take appropriate measures to control the situation. Beyond that, the state authorities have no power as urged by the learned counsel for the state Governments and as accepted in the impugned judgment of . It is an accepted canon of Construction of Statutes that a statute must be read as a whole and one provision of the Act should be construed with reference to other provisions of the same act so as to make a consistent, harmonious enactment of the whole statute. The court must ascertain the intention of the legislature by directing its attention not merely to the clauses to be construed, but to the scheme of the entire statute. The attempt must be to eliminate conflict and to harmonise the different parts of the statute for it cannot be assumed that had given by one hand what it took away by the other. [See in this connection and .] This Court in . (vide para 17), said: \"However, it is well recognised that, when a rule or a section is a part of an integral scheme, it should not be considered or construed in isolation. One must have regard to the scheme of the fasciculus of the relevant rules or sections in order to determine the true meaning of any one or more of them. An isolated consideration of a provision leads to the risk of some other inter- related provision becoming otiose or devoid of meaning.\" Against the background of these principles, it is not possible to agree with the view taken by that Section 7(iv) of the Act is an independent source of power of such amplitude as held. In our view, the power of the state under Section 7(iv) of the Act is statutory; absolute to the extent provided therein, and limited to the extent indicated by Section 23(1A) of the Act. ", "Learned counsel for the appellants urged that the expression \"for the time being\" used in clause (iv) of Section 7 of the Act is significant and indicates the transient nature of the power that is conferred on under the rules to ban or otherwise take any other appropriate action in relation to an article of food even if it be \"in the interest of public health\". This too lends support to their contention. Learned counsel for the state of Maharashtra and the learned Advocate General for the state of Goa relied on the judgments of this Court in and . to contend that the expression \"for the time being\" would suggest the time period for which the order is in force and not necessarily the transient nature of the order. Even if this be correct, the fact still remains that the state authority has no power to make an order of prohibition, either of a permanent nature or enduring for such a long time as to be deemed to be permanent. ", "Contemporanea expositio: ", "The appellants point out that, despite the amendment having been made in the year 1964, even the state of Maharashtra kept on corresponding with to suggest that it was necessary to carry out an amendment in the law to enable it to permanently ban the article concerned. Reliance is placed on pp. 152 - 154, Vol. II of S.L.P. No. 834 of 2003, the annexure to the counter affidavit filed by on behalf of . Particular reference is made to the letter dated 1st August, 1997 from the Commissioner, and to the Secretary, , Mumbai about the ill-effects of gutka and requesting the state Government to amend the Maharashtra Prevention of Food Adulteration Rules and also to make a request to to amend the Prevention of Food Adulteration Act so as to enable the state of Maharashtra to exercise the powers of a permanent ban. While this may not be really conclusive, it certainly indicates the manner of the state authority viewing its power and the rules under which it was exercising the power. The court can certainly take into account this situation on the doctrine of Contemporanea expositio. It is significant that, while dealing with the powers of food inspector under Section 10(1)(c) of the Act, the Act provides that a food inspector shall have power, with the previous approval of having jurisdiction in the local area concerned, or with the previous approval of the , to prohibit the sale of any article of food in the interest of public health. Secondly, this clause does not include the phrase \"for the time being\". If the arguments of the learned counsel for the state Governments were to prevail, then this provision would give to the food inspector, a lower authority in the hierarchy, an extraordinary power of banning permanently - which power can only be the result of a policy decision to be taken at the highest level of the state Government. In our view, it is not possible to interpret these clauses disparately or disjunctively. Clause (iv) of Section 7 and clause (c) of sub-section (1) of Section 10 of the Act and their interplay unmistakably suggest that the power conferred on the and the food inspector, being derived from the Rules made in exercise of the powers exercised under Section 24 of the Act are necessarily subservient to the powers derivable from the rules made under Section 23 of the Act. Hence, neither the , nor the food inspector can be said to have such power which could be available to by prescription of a rule in exercise of power under Section 23(1A)(f) . ", "Reliance was placed by the respondents on the decision of a learned Single Judge in . Having perused the judgment, we are unable to approve of it. We notice that neither the interplay between Sections 23 and 24 , nor the question as to whether Section 24 can be the source of power, is discussed or decided therein. Conflict with Central Act 34 of 2003: ", "Mr. , learned counsel appeared for the appellants in the appeals arising out of SLP Nos. 23635 of 2002 and 533 of 2003, attacked the judgment of from a different perspective. He contends that the Cigarettes and Other Tobacco Products (Prohibition of Advertisement and Regulation of Trade and Commerce, Production, Supply and Distribution) Act , 2003, (Act 34 of 2003), referable to entry 52, List I and entry 18, List III to the Seventh Schedule of the Constitution of India, now occupies the entire field in relation to tobacco. The preamble to the Act 34 of 2003 reads as under: ", "\" An Act to prohibit the advertisement of, and to provide for the regulation of trade and commerce in, and production, supply and distribution of, cigarettes and other tobacco products and for matters connected therewith or incidental thereto\" ", "The Statement of Objects and Reasons accompanying the Bill reads as under: ", "\"1. Tobacco is universally regarded as one of the major public health hazards and is responsible directly or indirectly for an estimated eight lakh deaths annually in the country. It has also been found that treatment of tobacco related diseases and the loss of productivity caused therein cost the country almost Rs.13,500/- crore annually, which more than offsets all the benefits accruing in the form of revenue and employment generated by tobacco industry. The need for a comprehensive legislation to prohibit advertising and regulation of production, supply and distribution of cigarettes and tobacco products was recommended by () and a number of points suggested by have been incorporated in the Bill. ", "2. The proposed Bill seeks to put total ban on advertising of cigarettes and other tobacco products and to prohibit sponsorship of sports and cultural events either directly or indirectly as well as sale of tobacco products to minors. It also proposes to make rules for the purpose of prescribing the contents of the specified warnings, the languages in which they are to be displayed, as well as displaying the quantities of nicotine and tar contents of these products. For the effective implementation of the proposed legislation, provisions have been proposed for compounding minor offences and making punishments for offences by companies more stringent. The objective of the proposed enactment is to reduce the exposure of people to tobacco smoke (passive smoking) and to prevent the sale of tobacco products to minors and to protect them from becoming victims of misleading advertisements. This will result in a healthier life style and the protection of the right to life enshrined in the Constitution. The proposed legislation further seeks to implement article 47 of the Constitution which, inter alia, requires the to endeavour to improve public health of the people. ", "3. The Bill seeks to achieve the aforesaid objects.\" ", "The aforesaid internal evidence in the statute, by reason of the preamble, and the external evidence in the Statement of Objects and Reasons, indicate that has evinced its intention to bring out a comprehensive enactment to deal with tobacco and tobacco products. However, the provisions of the statute do not suggest that had considered it to be expedient to ban tobacco or tobacco products in public interest or to protect public health. Act 34 of 2003 passed by does not totally ban the manufacture of tobacco or tobacco products. Section 6 merely prohibits sale of cigarettes and tobacco products to a person under the age of eighteen years. There are stringent provisions made in the Act containing the prohibition of advertisement of cigarettes and tobacco products. Section 3(p) defines the expression \"tobacco products\" as the products specified in the Schedule. Entry 8 of the Schedule to the Act reads \"pan masala or any chewing material having tobacco as one of its ingredients (by whatever name called).\" Thus, pan masala or any chewing material having tobacco is also one of the products in respect of which the Act could have imposed a total prohibition, if was so minded. On the other hand, there is only conditional prohibition of these products against sale to persons under eighteen years of age. ", "Against this backdrop of Act 34 of 2003, learned counsel contended that inasmuch as Act 34 of 2003 occupies the whole field of tobacco and tobacco products and does not completely ban the sale of 'tobacco products' except to under aged persons, while the impugned notification expressly bans manufacture or sale to any person of the very same product (viz. Pan masala and gutka), there is legislative repugnancy which calls for resolution. Reliance was placed on the judgment of this Court in . wherein this Court considered the constitutional validity of a state enactment. This Court's earlier judgment in . and were approved and the test of repugnancy was formulated thus: ", "\"Repugnancy between two statutes may thus be ascertained on the basis of the following three principles (1) Whether there is direct conflict between the two provisions; (2) Whether intended to lay down an exhaustive code in respect of the subject matter replacing the Act of ; and (3) Whether the law made by and the law made by occupy the same field.\" ", "Learned counsel contended that when two legislations referable to the same legislative authority are inconsistent with each other, then the later enactment is deemed to have impliedly repealed the previous one and referred to the observations of this Court in . : ", "\"The entire theory underlying implied repeals is that there is no need for the later enactment to state in express terms that an earlier enactment has been repealed by using any particular set of words or form of drafting but that if the legislative intent to supersede the earlier law in manifested by the enactment of the provisions as to effect such supersession, then there is in law a repeal notwithstanding the absence of the word 'repeal' in the later statute. Now, if the legislative intent to supersede the earlier law is the basis upon which the doctrine of implied repeal is founded could there be any incongruity in attributing to the later legislation the same intent which s. 6 presumes where the word 'repeal' is expressly used. So far as statutory construction is concerned, it is one of the cardinal principles of the law that there is no distinction or difference between an express provision and a provision which is necessarily implied, for it is only the form that differs in the two cases and there is no difference in intention or in substance.\" ", "The learned counsel relied on . . The observation of this in the majority judgment of this is that if the later legislation is on the same subject and the legislative intent is to occupy the whole field, then the later legislation prevails. ", "It is submitted that a reading of the Act 34 of 2003 clearly suggests that it is a special law intended to deal with tobacco and its product. The Prevention of Food Adulteration Act , 1954 is a general law dealing with adulteration of food articles and a tobacco product is incidentally referred to in the said law in the context of prevention of adulteration. In case of conflict between a special law and a general law, even if both are enacted by the same legislative authority, the special law must displace the general law to the extent of inconsistency. The operation of the maxim generalia specialibus non derogant has been approved and applied by this Court in such situations. (See in this connection: . , and . , . , and . .) Respondents contend that inasmuch as Act 34 of 2003, though passed by , and assented to by the President, is not brought into force by by notification, the question of conflict with the provisions of the Act does not arise. We need not consider this contention since Act 34 of 2003 has now been brought into force w.e.f. 1st May, 2004. In any event, as pointed out in there is distinction between \"making law\" and \"commencement of the operation of an Act\" and a situation of conflict can arise even when a law has been made and not brought into force. Articles 14 and 19 of the Constitution of India: ", "Mr. , learned counsel for the appellant in SLP No. 2186 of 2003, urged that the said appellant manufactures Rajnigandha pan masala which contains no tobacco. Though there might be arecanut in it, there is no trace of magnesium carbonate in the product. Assuming that traces of magnesium carbonate were to be formed during consumption of the product along with lime, the exercise of power should have been restricted to banning pan masala containing magnesium carbonate and not wholesale banning of pan masala, irrespective of the content of magnesium carbonate. The learned counsel contended that the order made under Section 7(iv) of the Act is bad for it is an unreasonable and excessive restriction on the Fundamental Right to carry on trade or business guaranteed under Article 19(1)(g) of the Constitution of India. The learned counsel highlighted the unreasonableness by reference to the provisions of the Act and the Rules and the specific situation contemplated in Appendix B at Paragraph A.25.02.01, which gives the definition and standards of quality with reference to chewing gum and bubble gum, for which magnesium carbonate, inter alia, is a permitted ingredient. He therefore contends that magnesium carbonate is not per se injurious to health for otherwise it would never have been permitted in any article of food. There is no material on the basis of which it can be demonstrated that the very same magnesium carbonate would become injurious to health if it arises on account of mixing of traces of magnesium in arecanut and carbonate in lime According to the learned counsel, this is a clear case of non- application of mind, notwithstanding the medical research papers and data made available in the affidavit filed by the state Government. We are unable to discern as to how the very same magnesium carbonate would become injurious as a result of combined chewing of arecanut and lime, particularly when it is not the case of the state Government that Rajnigandha pan masala itself contains magnesium carbonate. It is permissible under Article 19(6) to impose a reasonable restriction \"in the interest of general public\". Assuming that such a restriction can be imposed, even if by legislation intended to prohibit manufacture, sale or storage of articles harmful or injurious to health, the restriction has to be commensurate with the danger posed. On a conspectus of the facts, we are unable to uphold the prohibition imposed by the impugned notification as a restriction which can pass the test of reasonableness under Article 19(6) of the Constitution of India for two reasons. First, there is no demonstrated danger to the public health by magnesium carbonate by consumption of Rajnigandha pan masala; secondly, even if there were, the prohibition could only have extended to pan masala containing magnesium carbonate and could not be wider than that. ", "Learned counsel for the appellants urge that if Section 7(iv) is construed in the manner as contended by the , then it would become unconstitutional. It is contended that if Section 7(iv) is construed as giving the authority to ban articles of food, even though not adulterated, then the sweep of the section would go out of entry 18 of List III of the Constitution of India. (\"adulteration of foodstuffs and other goods.\") and intrude into the domain of entry 6 of List II (\"public health and sanitation; hospitals and dispensaries\") which is the exclusive domain of the state Government. If the court were to read Section 7(iv) in the manner suggested by the s, then it would be ultra vires the legislative competence of . It is the duty of the court to attempt to read every legislation in such manner as to uphold its constitutional validity. The learned counsel contend that in order to uphold the legislative competence of the provisions of the Act, the sweep of Section 7(iv) must be confined to the domain of 'adulteration of food stuffs and other articles' without entering into the domain of \"public health\". Reading down the statute in order to upheld its constitutional validity is a device well known to the constitutional courts. [See in this connection . , . and , learned counsel for the s, however, supported the findings of the division bench of that the constitutional validity of Section 7(iv) was never in danger as it could be supported on the doctrine of pith and substance. He contends that in pith and substance the Prevention of Food Adulteration Act , 1954 deals with the subject of adulteration, though, incidentally, by reason of Section 7(iv) it may make an incursion into the domain of \"public health\" which is the exclusive province of the legislature. This contention appears to have been accepted by the impugned judgment of . In fact, goes to the extent of saying that the power of under Section 7(iv) is much wider than the power of under the Rules made under Section 23(1A)(f) on the reasoning that while the power of under a rule made under Section 23(1A)(f) extends to the prohibition of the sale of \"any substance which may be injurious to health when used as food or as an ingredient in the manufacture of any article of food\" there is no such restriction under Section 7(iv) which is posited as an independent source of power. It is urged that by exercise of the power invested in under clause (iv) of Section 7 , any article, irrespective of whether it is used as food or as an ingredient in the manufacture of any article of food, may be prohibited as long as the prohibition is \"in the interest of public health\". ", "We find it difficult to agree with the submissions of Mr. . That all provisions of a statute have to be read harmoniously and any interpretation as to be ex visceribus actus, is a trite doctrine of construction of statutes. Undoubtedly, if Section 7(iv) is read in isolation, it gives the impression that this is an independent source of power, not subject to any limitation other than the guideline \"in the interest of public health\". But, when the scheme of the Prevention of Food Adulteration Act is analysed in the light of its preamble and the Statement of Objects and Reasons, it becomes clear that there is no independent source of power under Section 7(iv) . Had it been so, there was no need for the rule making power of under Section 24(2)(a) to define the powers and duties of or local authority and under the Act. The interplay of sections 23(1A)(f) and 24(2)(a) read with the existing rules in the different states, even after the amendment of Section 7(iv) by the Act 49 of 1964, leads us to conclude that the contention of the states in this regard cannot be accepted. Learned counsel for the appellants contend that the impugned notification is violative of the fundamental rights guaranteed under Article 19(1)(g) as it is excessively restrictive in nature. While the notification seeks to ban pan masala which does not include tobacco, it does not at the same time ban tobacco in any form. The literature produced by the State of Maharashtra before suggested, undoubtedly, that consumption of tobacco in any form was injurious to health, but that consumption of pan masala was likely to be addictive and lead to hyper- magnesia. Strangely, the States did not ban chewing tobacco or other tobacco products which contain almost cent per cent tobacco, but they banned the sale of gutka which contains only about 6 per cent of tobacco and pan masala, which contains no tobacco whatsoever, even accepting on the correctness of the material presented. Further, the literature produced by the States indicates that pan masala is addictive amongst children and, therefore, likely to be injurious to their health in the long run. Assuming this to be true, the restriction could only have been on sale to under-aged persons and not by way of a total ban. Thus, in our view, the impugned notification is violative of the fundamental right of the appellants guaranteed under Article 19(1)(g ), both because it is unreasonable and also because it is excessive in nature. A contrast with the provisions of the Act 34 of 2003 in this regard would drive home the point. While dealing with the nature of a reasonable restriction on the fundamental rights under Article 19(1)(g ), this observed in . as under: \"The impugned notification, though technically within the competence of , directly infringes the fundamental right of the petitioner guaranteed by Art. 19(1)(g ), and may be upheld only if it be established that it seeks to impose reasonable restrictions in the interest of the general public and a less drastic restriction will not ensure the interest of the general public. The must in considering the validity of the impugned law imposing a prohibition on the carrying on of a business or profession, attempt an evaluation of its direct and immediate impact upon the fundamental rights of the citizens affected thereby and the larger public interest sought to be ensured in the light of the object sought to be achieved, the necessity to restrict the citizen's freedom, the inherent pernicious nature of the act prohibited or its capacity or tendency to be harmful to the general public, the possibility of achieving the object by imposing a less drastic restraint, and in the absence of exceptional situations such as the prevalence of a state of emergency - national or local - or the necessity to maintain essential supplies, or the necessity to stop activities inherently dangerous, the existence of a machinery to satisfy the administrative authority that no case for imposing the restriction is made out or that a less drastic restriction may ensure the object intended to be achieved.\" ", "The impugned notification fails on this test of reasonable restriction. Res extra commercium: ", "Appellants next contend that the assumption of that pan masala or gutka is res extra commercium is wholly incorrect. The concept of res extra commercium was expounded in the Constitutional Bench of this Court in . thus: ", "\"58. We also do not see any merit in the argument that there are more harmful substances like tobacco, the consumption of which is not prohibited and hence there is no justification for prohibiting the business in potable alcohol. What articles and goods should be allowed to be produced, possessed, sold and consumed is to be left to the judgment of the legislative and the executive wisdom. Things which are not considered harmful today, may be considered so tomorrow in the light of the fresh medical evidence. It requires research and education to convince the society of the harmful effects of the products before a consensus is reached to ban its consumption. Alcohol has since long been known all over the world to have had harmful effects on the health of the individual and the welfare of the society. Even long before the Constitution was framed, it was one of the major items on the agenda of the society to ban or at least to regulate, its consumption. That is why it found place in Article 47 of the Constitution. It is only in recent years that medical research has brought to the fore the fatal link between smoking and consumption of tobacco and cancer, cardiac diseases and deterioration and tuberculosis. There is a sizeable movement all over the world including in this country to educate people about the dangerous effect of tobacco on individual's health. The society may, in course of time, think of prohibiting its production and consumption as in the case of alcohol. There may be more such dangerous products, the harmful effects of which are today unknown. But merely because their production and consumption is not today banned, does not mean that products like alcohol which are proved harmful, should not be banned. ", ". . . . . ", "60(b) The right to practise any profession or to carry on any occupation, trade or business does not extend to practising a profession or carrying on an occupation, trade or business which is inherently vicious and pernicious, and is condemned by all civilised societies. It does not entitle citizens to carry on trade or business in activities which are immoral and criminal and in articles or goods which are obnoxious and injurious to health, safety and welfare of the general public, i.e., res extra commercium, (outside commerce). There cannot be business in crime.\" ", "Is the consumption of pan masala or gutka (containing tobacco), or for that matter tobacco itself, considered so inherently or viciously dangerous to health, and, if so, is there any legislative policy to totally ban its use in the country ? In the face of Act 34 of 2003, the answer must be in the negative. It is difficult to accept the contention that the substance banned by the impugned notification is treated as res extra commercium. In the first place, the gamut of legislation enacted in this country which deals with tobacco does not suggest that has ever treated it as an article res extra commercium, nor has attempted to ban its use absolutely. The Industries (Development and Regulations) Act , 1951 merely imposed licensing regulation on tobacco products under item 38(1) of the First Schedule. The Central Sales Tax Act , 1956 in Section 14(ix) prescribes the rates for Central Sales Tax. Additional Duties of Excise (Goods of Special Importance) Act, 1957 prescribes the additional duty leviable on tobacco products. The Tobacco Board Act , 1975 established for development of tobacco industries in the country. Even the latest Act, i.e. the Cigarettes and Other Tobacco Products (Prohibition of Advertisement and Regulation of Trade and Commerce, Production, Supply and Distribution) Act , 2003, does not ban the sale of tobacco products listed in the Schedule except to minors. Further, we find that in the tariff schedule of the Central Sales Tax Act , there are several entries which deal with tobacco and also pan masala. In the face of these legislative measures seeking to levy restrictions and control the manufacture and sale of tobacco and its allied products as well as pan masala, it is not possible to accept that the article itself has been treated as res extra commercium. The legislative policy, if any, seems to be to the contrary. In any event, whether an article is to be prohibited as res extra commercium is a matter of legislative policy and must arise out of an Act of legislature and not by a mere notification issued by an executive authority. Need to read down: ", "There is also merit in the contention of the appellants that if the provisions of Section 7(iv) of the Act are not read down as conferring powers on the authority to deal with an emergent situation, the section would be conferring arbitrary powers on the authority and would be procedurally unfair. This is particularly so in the face of the statutory provision under which licences have already been granted to the manufactures of pan masala and gutka for manufacture of the articles. There is already a provision in the statutory scheme for cancellation and suspension of a licence. Without going through such procedure, the power in the state authority to suddenly bring out the result of cancellation or suspension of the licence, without procedural safeguards, would certainly be arbitrary and liable to be hit by Article 14 of the Constitution of India. For this reason also, the power under Section 7(iv) needs to be read down as conferring powers on the authority only to deal with an emergent situation. ", "There has been some argument at the as to whether the impugned notification is the result of an executive act or a legislative act. We have already indicated that, in our view, Section 7(iv) is not an independent source of power. The notification can only be issued by the authority the source of whose power must be located elsewhere. Section 7(iv) merely indicates the consequences which would flow if a valid notification is issued. It is, therefore, not necessary for us to go into the niceties between an executive and a legislative act. ", "Mr. , learned counsel appearing for one of the appellants, pointed out that the Central Sales Tax Act by Section 14(ix) recognises gutka as a legitimate article of interstate trade or interstate sale. So is pan masala recognised as such a legitimate article of interstate sale. The learned counsel relied on . to contend that a law or order which confers arbitrary or uncontrolled power on the executive in the matter of regulating trade or commerce in normally available commodities must be held to unreasonable. [See also in this connection the observations of this Court in counsel highlighted the observations of this Court in and contended that irrespective of whether the power to issue the impugned notification is a legislative power or an executive power, it must pass the test of fairness in procedure. Any provision of law which enables to an authority by a notification to bring to standstill a business, which is otherwise permitted by law, must be held to be arbitrary; unfair and an abridgment of the fundamental rights guaranteed under Article 14 of the Constitution. [See also in this connection , and is in the light of these authorities that we are required to adjudge the constitutionality of the interpretation put on Section 7(iv) . Learned counsel for the , however, urge that the impugned notification is a legislative act and not an administrative act. Thus, according to them, there is no question of giving a hearing before taking a policy decision to ban the manufacture for sale, storage, sale and distribution of pan masala and gutka. ", "We are unable to accept the contention of the States. In our view, the scheme of the Act suggests that a decision to ban an article injurious to health, when used as food or as an ingredient in the manufacture of any article of food, can only be the result of broader policy. Hence, this larger power appears to have been located only in under Section 23(1A)(f) and not in the state . As we have already pointed out, the power of the state is only transitory in nature and designed to deal with local emergencies. In our considered view, the impugned notification is certainly an administrative act and not a legislative act. Inasmuch as by an executive act the manufacture for sale, storage, sale or distribution of the concerned article has been banned so as to interfere with the fundamental rights of the appellants guaranteed under Articles 14 and 19 of the Constitution of India, the impugned notification is illegal and unconstitutional. We are unable to accept that the words \"in the interest of public health\" used in clause (iv) of Section 7 of the Act can operate as an incantation or mantra to get over all the constitutional difficulties posited. In any event, the collocation of the words in the statutory scheme suggests not a matter of policy, but a matter of implementation of policy. For this reason also, we are of the view that the impugned notification must fail. The learned Advocate General for the contended that in the , apart from the impugned notification dated 24th January, 2003, there is a subsequent notification dated 7th April, 2003 which is not impugned by the appellants. Reliance is placed on a judgment of the division bench of in v. and Ors. . The division bench in the said decision seems to have been overwhelmed by the material produced with regard to the hazardous nature of pan masala with tobacco and taken the view that was justified in taking a decision to ban tobacco products within the realm of such policy decision. The division bench has not addressed itself to any of the sections of the Act which decide the powers. The learned Advocate General for the contends that matters of public health are essentially matters of policy decision, legislative or administrative, planned and executed in the greater interest of public health by the and the court should not interfere with such policy matters. He relied on the observations of . wherein this Court said: ", "\"24. The raison d'etre of the State being the welfare of the members of the society, the whole purpose of the creation of the State would be to maintain order, health and morality by suitable legislation and proper administration. The State has the power to prohibit trade or business which are illegal, immoral or injurious to the health and welfare of the people. No one has the right to carry on any trade or occupation or business which is inherently vicious and pernicious and is condemned by all civilized societies. Equally no one could claim entitlement to carry on any trade or business or any activities which are criminal and immoral or in any articles of goods which are obnoxious ad injurious to the safety and health of general public. There is no inherent right in crime. Prohibition of trade of business of noxious or dangerous substances or goods by law is in the interest of society welfare.\" ", "There is a plethora of legislation dealing with tobacco products, gutka and pan masala and the fact that licences have been issued to the appellants to manufacture the concerned articles, which does not lead to the conclusion that the trade or business in the concerned articles is an activity which is \"criminal in propensity, immoral, obnoxious, injurious to the health of general public\" or that the ban is a result of 'public expediency and public morality'. ", "Is it food ? ", "Mr. , learned counsel appearing for the petitioners in writ petition No. 173 of 2003, raised a further contention that pan masala or gutka which is the subject matter of the impugned notification does not amount to food within the meaning of its definition in Section 2(v) of the Act. Section 2(v) of the Act reads as under: ", "\"2. (v) \"food\" means any article used as food or drink for human consumption other than drugs and water and includes- ", "(a) any article which ordinarily enters into, or is used in the composition or preparation of , human food, ", "(b) any flavouring matter or condiments, and ", "(c) any other article which the Central Government may, having regard to its use, nature, substance or quality, declare, by notification in the Official Gazette, as food for the purposes of this Act.\" ", "In his submission, the expression \"food\" as defined in the Lexicon could only be \"a substance taken into the body to maintain life and growth\". No one in his right mind would consider that pan masala or gutka would be consumed for maintenance and development of health of human being. , this Court held that the word \"food\" is a very general terms and applies to all that is eaten by men for nourishment and takes in also subsidiaries. Since pan masala, gutka or supari are eaten for taste and nourishment, they are all food within the meaning of Section 2(v) of the Act. ", "The learned counsel relied on a judgment of a division bench of this in C.A. No. 12746-12747 of 1996 (decided on 6th November, 2003). In our view, this judgment is of no aid to us. In the first place, this judgment arises under the provisions of the Essential Commodities Act , 1955, read with the Tamil Nadu Scheduled Articles (Prescription of Standards) Order, 1977 and the notification dated 9th June, 1978, issued by which laid down certain specifications \"in relation to foodstuffs\". The question that arose before the was whether tea is 'foodstuff' within the meaning of the said legislation. The division bench of this came to the conclusion that 'tea' is not food as it is not understood as 'food' or 'foodstuff' either in common parlance or by the opinion of lexicographers. We are unable to derive much help from this judgment for the reason that we are not concerned with tea. It is not possible to extrapolate the reasoning of this judgment pertaining to tea into the realm of pan masala and gutka. In any event, the judgment in Tejani (supra) was a judgment of which does not seem to have been noticed. ", "We are, therefore, unable to agree with the contention that pan masala or gutka does not amount to \"food\" within the meaning of definition in Section 2(v) of the Act. However, we do not rest our decision solely on this issue. ", "Paradoxical consequence: ", "There is yet another reason why we are inclined to take the view that Section 7(iv) deals with a situation of emergency with respect to the local area. A decision for banning an article of food or an article containing any ingredient of food injurious to health can only arise as a result of broadly considered policy. If such a power be conceded in favour of a local authority like , paradoxical results would arise. The same article could be considered injurious to public health in one local area, but not so in another. In our view, the construction of the provision of the statute must not be such as to result in such absurd or paradoxical consequences. Hence, for this reason also, we are of the view that the power of is a limited power to be exercised locally for temporary duration. ", "Width of power: ", "The learned counsel for the state of Maharashtra contended that the power of discernible in clause (iv) of Section 7 of the Act is an independent power and much wider than the power of under Section 23 of the Act. He contended that while the power of discernible from Section 23(1A)(f) is restricted only to prohibiting the manufacture or sale of articles of food or ingredients of food, the power of the state is much wider and could extend even to articles which may not amount to food or ingredients of food, or even if they are not injurious to health, as long as the test of \"in the interest of public health\" is satisfied. In our view, this is an argument of desperation. We cannot conceive of such wide ranging power vested in a local authority without there being sufficient guidelines as to the manner of deciding the policy and implementing it and elucidated in the statute itself. We may hasten to point out that even the power of for making the rules under Section 23 is subject to the condition of consultation with for food standards constituted under Section 23 and placing of the rules before . If the power of is such as contended by the learned counsel for the state of Maharashtra, then its power would range sky high without any limitation whatsoever. The authority could ban any article, irrespective of whether it is used as food or otherwise, and irrespective of whether it is injurious to health or otherwise. To take an extreme illustration, if a state in some local area were taken it into its head that consumption of tea, coffee or milk is not 'in the interest of public health', it can issue an order of absolute prohibition irrespective of whether it is injurious to health or not. We do not think that the scheme of the Act warrants such an interpretation. A reference of this 's judgment in vide paras 16 and 17 makes it clear that the object and the purpose of the Preventon of Food Adulteration Act, 1954 is to eliminate the danger to human life from the sale of unwholesome articles of food. This held that the legislation of 'Adulteration of Food Stuffs and other Goods' (entry 18 List III of the Seventh Schedule) is enacted to curb the widespread evil of food adulteration and is a legislative measure for social defence. This court indicated the object of the Prevention of Food Adulteration Act , 1954, its constitutional basis and its purpose in the following observations: ", "\"16. The object and the purpose of the Act are to eliminate the danger to human life from the sale of unwholesome articles of food. The legislation is on the topic 'Adulteration of Food Stuffs and other Goods' (entry 18 List III Seventh Schedule). It is enacted to curb the widespread evil of food adulteration and is a legislative measure for social defence. It is intended to suppress a social and economic mischief - an evil which attempts to poison, for monetary gains, the very sources of sustenance of life and the well-being of the community. The evil of adulteration of food and its effects on the health of the community are assuming alarming proporations. The offence of adulteration is a socio-economic offence. . said: The Act has been enacted to curb and remedy the widespread evil of food adulteration, and to ensure the sale of wholesome food to the people. ", "It is well-settled that wherever possible, without unreasonable stretching or straining, the language of such a statute should be construed in a manner which would suppress the mischief, advance the remedy, promote its object, prevent its subtle evasion and foil its artful circumvention. ", "(emphasis supplied) ... ", "18. The offences under the 'Act' are really acts prohibited by the police powers of the in the interests of public health and well-being. The prohibition is backed by the sanction of a penalty. The offences are strict statutory offences. Intention or mental state is irrelevant. In v. referring to the nature of offences under the Food and Drugs Act , 1955, it was said: ", "As is well known, Section 2 of the Food and Drugs Act , 1955, constitutes an absolute offence. If a person sells to the prejudice of the purchaser any food, and that includes drink, which is not of the nature or not of the substance or not of the quality demanded by the purchaser he shall be guilty of an offence. The forbidden act is the selling to the prejudice of the purchaser.\" ", "These observations make it clear that the purpose of the Act, as its title suggests, is to prevent adulteration of food. Any attempt to travel beyond these parameters must necessarily be looked at askance by the court. There is one more facet of the impugned notification which needs consideration. Neither Section 7(iv) of the Act, nor any other provision of the Act or the Rules indicates the manner in which an order of prohibition is to be notified by . The manner of bringing into force the Rules made by a delegate of legislative authority would be indicated in the Act itself. There is no indication in the Act as to how the order made by would be brought into force. This is a pointer to the fact that the orders made by are only transitory and intended to deal with emergent local situations. ", "Natural Justice: ", "Learned counsel for the State of Maharashtra cited . (vide para 7) where this Court observed thus: ", "\"The third observation we wish to make is, price fixation is more in the nature of a legislative activity than any other. It is true that, with the proliferation of delegated legislation, there is a tendency for the line between legislation and administration to vanish into an illusion. Administrative, quasi-judicial decisions tend to merge in legislative activity and, conversely, legislative activity tends to fade into and present an appearance of an administrative or quasi-judicial activity. Any attempt to draw a distinct line between legislative and administrative functions, it has been said, is 'difficult in theory and impossible in practice'. Though difficult, it is necessary that the line must sometimes be drawn as different legal rights and consequences may ensue. The distinction between the two has usually been expressed as 'one between the general and the particular'. 'A legislative act is the creation and promulgation of a general rule of conduct without reference to particular cases; an administrative act is the making and issue of a specific direction or the application of a general rule to a particular case in accordance with the requirements of policy'. 'Legislation is the process of formulating a general rule of conduct without reference to particular cases and usually operating in future ; administration is the process of performing particular acts, of issuing particular orders or of making decisions which apply general rules to particular cases'. It has also been said: 'Rule-making is normally directed toward the formulation of requirements having a general application to all members of a broadly identifiable class' while, 'adjudication, on the other hand, applies to specific individuals or situations'. But, this is only a broad distinction, not necessarily always true. Administration and administrative adjudication may also be of general application and there may be legislation of particular application only. That is not ruled out. Again, adjudication determines past and present facts and declares rights and liabilities while legislation indicates the future course of action. Adjudication is determinative of the past and the present while legislation is indicative of the future. The object of the rule, the reach of its application, the rights and obligations arising out of it, its intended effect on past, present and future events, its form, the manner of its promulgation are some factors which may help in drawing the line between legislative and non-legislative acts.\" ", "We are, however, unable to accept the contention of the learned counsel for the state of Maharashtra that, because the notification is generally intended, it is necessarily a legislative act and therefore there was no question of complying with principles of natural justice. If that were so, then every executive act could masquerade as a legislative act and escape the procedural mechanism of fair play and natural justice. . (vide para ", "17), this Court after referring to the aforesaid observations of , J. in (supra), observed that even when exercising a legislative function, the delegate may in a given case be required to consider the view point which may be likely to be affected by the exercise of power. This Court pointed out that conditional legislation can be broadly classified into three categories: (1) when the legislature has completed its task of enacting a statute, the entire superstructure of the legislation is ready but its future applicability to a given area is left to the subjective satisfaction of the delegate (as in case ); (2) where the delegate has to decide whether and under what circumstances a legislation which has already come into force is to be partially withdrawn from operation in a given area or in given cases so as not to be applicable to a given class of persons who are otherwise admittedly governed by the Act; (3) where the exercise of conditional legislation would depend upon satisfaction of the delegate on objective facts placed by one class of persons seeking benefit of such an exercise with a view to deprive the rival class of persons who otherwise might have already got statutory benefits under the Act and who are likely to lose the existing benefit because of exercise of such a power by the delegate. This Court emphasised that in the third type of cases the satisfaction of the delegate must necessarily be based on objective considerations and, irrespective of whether the exercise of such power is judicial or quasi-judicial function, still it has to be treated to be one which requires objective consideration of relevant factual data pressed into service by one side, which could be rebutted by the other side, who would be adversely affected if such exercise of power is undertaken by the delegate. ", "In our view, even if the impugned notification falls into the last of the above category of cases, whatever the material had, before taking a decision on articles in question, ought to have been presented to the appellants who are likely to be affected by the ban order. The principle of natural justice requires that they should have been given an opportunity of meeting such facts. This has not been done in the present case. For this reason also, the notification is bad in law. Conclusion: ", "As a result of the discussions, we are of the view that: ", "1. Section 7(iv) of the Act is not an independent source of power for the state authority; ", "2. The source of power of the state is located only in the valid rules made in exercise of the power under Section 24 of the Act by the State Government, to the extent permitted thereunder; ", "3. The power of under the rules is only of transitory nature and intended to deal with local emergencies and can last only for short period while such emergency lasts; ", "4. The power of banning an article of food or an article used as ingredient of food, on the ground that it is injurious to health, belongs appropriately to to be exercised in accordance with the rules made under Section 23 of the Act, particularly, sub-section (1A)(f). ", "5. The state has no power to prohibit the manufacture for sale, storage, sale or distribution of any article, whether used as an article or adjunct thereto or not used as food. Such a power can only arise as a result of wider policy decision and emanate from Parliamentary legislation or, at least, by exercise of the powers by by framing rules under Section 23 of the Act; ", "6. The provisions of the Cigarettes and Other Tobacco Products (Prohibition of Advertisement and Regulation of Trade and Commerce, Production, Supply and Distribution) Act , 2003 are directly in conflict with the provisions of Section 7(iv) of the Prevention of Food Adulteration Act, 1954. The former Act is a special Act intended to deal with tobacco and tobacco products particularly, while the latter enactment is a general enactment. Thus, the Act 34 of 2003 being a special Act, and of later origin, overrides the provisions of Section 7(iv) of the Prevention of Food Adulteration Act, 1954 with regard to the power to prohibit the sale or manufacture of tobacco products which are listed in the Schedule to the Act 34 of 2003; ", "7. The impugned notifications are ultra vires the Act and, hence, bad in law; ", "8. The impugned notifications are unconstitutional and void as abridging the fundamental rights of the appellants guaranteed under Articles 14 and 19 of the Constitution. ", "In the result, we allow the appeals and the writ petition and set aside the impugned judgments of the division benches of and and quash the notifications impugned as bad in law, void, illegal and unenforceable against the appellants/petitioners. ", "No order as to costs."], "relevant_candidates": ["0000006571", "0000033396", "0000084570", "0000243782", "0000268805", "0000290430", "0000317935", "0000345466", "0000482324", "0000535731", "0000664536", "0000677551", "0000713666", "0000791872", "0000865455", "0000914491", "0000970048", "0001186368", "0001224032", "0001300072", "0001336659", "0001401686", "0001421102", "0001466885", "0001472719", "0001474119", "0001490250", "0001506108", "0001623469", "0001646640", "0001703652", "0001766147", "0001849054", "0001940931", "0038264736"]} {"id": "0001706390", "text": ["JUDGMENT , J. ", "1. The above First Appeal is filed by the Insurer , Appellant No. 1, the insured owner of the motor lorry, bearing No. MRT 8615 Minu D. Mehta -- Partner, , Appellant No. 2 and the said partnership firm, Appellant No. 3, under Section 110-D of the Motor Vehicles Act, 1939, against the award passed against them in the sum of Rs. l,43,400/- on an application for compensation made to the by Respondent Dr. . ", "2. By the award a sum of Rupees 500/- was also awarded to Smt. , nurse and a further sum of Rs. 1,000/- was awarded as costs to Dr. . It is not in dispute that the appeal filed by against the award passed in favour of Smt. for Rs. 500/- and costs at Rs. 100/- has been dismissed summarily on August 14, 1975. ", "3. The award In favour of Dr. is challenged on two grounds by the appellants; Firstly, on the ground that the negligence on the part of the driver of the lorry was not established in the case by Dr. ; and secondly on the ground that the quantum of damages was wrongly calculated as Rs. 1,400/- for nursing expenses, Rs. 300/- for medicines and other expenses, Rs. 73,779/-, as the loss sustained for 4 years since the year of the accident and Rs. 63,000/- as 50% of Rs. 1,26,000/-, which would be the expected loss, which the claimant had to suffer for the remainder of his life, calculated at 7 years. ", "4. It was further contended on behalf of , -- appellant No, 1 -- that in any event having regard to the provisions of Section 95 (2) (a), the liability of the insurance company under the policy cannot exceed the limit of Rs. 20,000/-. ", "5. The relevant facts may be briefly stated as under: Dr. was driving motor car MRC 4450 ( Car) from Worli towards Haji Ali by the correct side of the road. Smt. , a nurse, was sitting by his side. At about 1.00 P.M., on April 14, 1969, as the vehicle was thus proceeding, the motor lorry, belonging to the Appellants Nos. 2 and 3, came from the opposite direction, in an uncontrollable speed, crossed over the central road dividers, went to the wrong side of the road and dashed against the car driven by the Respondent, at a place situated on Dr. Annie Beasant Road, Opposite Lotus Cinema. ", "6. As a result of this accident, the Respondent Dr. and nurse both sustained injuries. They were removed to , Bombay. ", "7. Dr. submitted that the driver of the said vehicle was rash and/or negligent while driving the same, inasmuch as:-- ", "(i) the lorry came on the wrong side of the road crossing the road dividers, ", "(ii) the driver drove the said vehicle at a high, excessive and improper speed, ", "(iii) the driver drove the said vehicle without any control over the same, ", "(iv) the driver drove the said vehicle without keeping proper lookout. ", "(v) the driver failed and neglected to apply the brakes and/or failed to apply the brakes effectively and/or in sufficient time so as to prevent the accident, ", "(vi) the driver failed and neglected to manoeuvre the vehicle so as to avoid the accident, ", "(vii) the driver was having the last opportunity to avoid the accident, which he has not availed of. ", "8. Dr. further submitted in his application in the prescribed form under Section 110-A of the Motor Vehicles Act, 1939, that he was undergoing great and unbearable pain and suffering in consequence of the injuries sustained by him since the date of the accident. He was unable to perform the natural and routine functions of life independently since the date of the accident. His expectation of life was shortened. His earning' capacity is likely to be substantially and adversely affected. ", "9. He is a surgeon having a nursing home and consulting rooms. Since the date of the accident he is not able to attend to the nursing home and consulting rooms. He has, therefore, lost income from his profession. He has to pay for the establishment charges of the nursing home. He has engaged the services of one Dr. (Miss) to look after the patients in the nursing home. He, therefore, claimed compensation of Rs. 3,00,000/- or such other sum as the may deem fit end proper as and by way of general and special damages with interest thereon from the date of the application till payment. ", "10. The claim of Dr. was resisted by filing a written statement on behalf of Appellants Nos. 2 and 3. They contended that they had taken all precautions to keep the truck in road-worthy condition; but at the material time the \"axle brake ring\" of the motor lorry came out and hence the driver lost control of the lorry. According to the said appellants such defect in the car could develop in a running vehicle all of a sudden and the driver would, as a result, lose control on the steering wheel. They also contended that the lorry was going at a moderate speed prior to the accident. They denied that the accident occurred on account of rash and negligent driving on the part of the driver of the motor lorry. ", "11. They also denied that the expectation of life was shortened or the injury caused any loss in the income of Dr. and submitted that the application was false and frivolous and untenable in law and should be dismissed with costs. ", "12. In view of these contentions, no other contentions were raised on behalf of 1, and the framed, four issues, and took evidence on those issues, of , Smt. , Smt. , who attended to Dr. , Dr. , who attended to Dr. and who also proved the medical certificate of Dr. . ) F. R. C. S. (Eng.) M. Ch. Orth. (), who were all examine! on behalf of the claimant. ", "13. The report of Dr. , was put in by consent of the parties. It reads as follows:-- ", "\"Dr. gave history of an accident in April 1969. He was treated by Dr. . His present complaints are as follows:-- ", "1. Pain at the right wrist. ", "2. Pain, restriction of movements and locking of the right elbow joint. ", "3. Weak grip on the right side. ", "4. Inability to do operative work. ", "Examination of the cervical spine revealed terminal restriction of movements. His right shoulder has restriction of external and internal rotation. Other movements of the right shoulder are normal. ", "The right elbow is swollen. There is thickening of the synovial membrane which is easily felt. There is tenderness over the olecranon process and the head of the radius. The range of movements is between 60 degrees and 130 degrees. There is crepitus felt with all the movements. Pronation and supination are only restricted in the last few degrees. The right wrist has a full range of movements. There is minimum tenderness over the styloid process of the ulna. The grip of the right hand is weaker than the left. There is no sensory loss in the right arm or the right hand. ", "X-rays of the right elbow show good healing of the fractures and changes of orteoarthritis. The head of the radius is broad and thickened. There are no significant changes in the right shoulder and wrist joints. ", "The restriction of range of movements at the elbow is a direct result of the injuries sustained. This would be a permanent disability to the patient. I would assess this disability at thirty per cent. ", "The disability is not in any way due to improper treatment. In fact I would say this, is an excellent surgical result. ", "It is unlikely that there would be any further deterioration in the joint function nor would there be any further improvement. ", "This restriction of movement of the elbow would no doubt affect Dr. 's operative work. I feel, he would be able to perform routine operations not lasting over an hour or so. However, prolonged operations and those demanding finer skill would be difficult to perform. I am sure he would not be required to give up totally his operative work.\" ", "14. As against this evidence, the appellants examined the motor vehicle Inspector ; Appellant No. 2 ; one K, S. Riani, the driver of the offending lorry on the date of the incident; , who was sitting at the relevant time in the lorry and who was an officer of ; one Gangadharam Bhotia, partner of ; and one Engineer, Surveyor, Inspecting motor vehicles. ", "15. The learned Member of for Greater Bombay, very carefully and exhaustively considered the evidence led by the parties in the light of the various contentions raised before him. He came to the conclusion that the plea of mechanical breakdown put forward by Appellant No. 2 was false because the evidence led by the Appellants was not sufficient to show that there was any mechanical breakdown, firstly because, although in the written statement it was contended that \"axle brake ring\" came out, as already stated, the same was a cock and bull story, inasmuch as, the witness on behalf of the Appellants, , had never heard of a part like \"Axle brake ring.\" ", "16. A theory was put forward at the hearing that \"drag link end\", also known as \"tie rod\" had come out. The words \"axle brake ring\" appears to have figured in the written statement because of an entry in the police diary, which appears to have been made on the basis of a statement given by the driver. Even Appellant No. 2 had to admit that he did not know any part of the lorry known as \"axle brake ring\". The was, therefore, constrained to remark that it was really painful that a businessman like who is a partner of had fallen to such an extent and given false evidence on oath. ", "17. The learned Member further disbelieved the theory of the coming out of the \"drag link end\", as the expert examined by the Appellants, viz., Engineer, who had inspected the lorry on April 22, 1969, at Veena Automobiles Service Station, stated in his cross-examination: ", "\"..... I found that tie rod broken. According to me, 'tie rod' and 'drag link' end' would mean same. The drag link or the tie rod are first attached with a nut. And these parts are made of steel alloy. So that normally they should not break. There is also a quarter pin which acts as a lock. I do not remember having inspected the quarter pin or not. I do not remember if nut was there. If there is anything wrong with the drag link end the driver would be able to feel the difference and could stop the vehicle by the side of the road immediately. ", "18. To the 's question he further stated: ", "\"A small hair like crack may deve lop and result in the snapping of the tie rod or drag link in resulting the loss of control for which there is no prior signal to the driver. It will depend on the momentum of the vehicle, the load it carries and the weight of the vehicle and for the driver it would take four to five feet to bring the vehicle to a dead stop. It will cover 5 ft. or so after the driver puts his leg on the brakes, and it depends on the presence of the mind of the driver and it is for the driver to take split second decision.\" ", "It is thus clear that even the plea about the breaking of the \"tie rod\" was not proved satisfactorily by the Appellants. ", "19. The learned Member of the , therefore, came to the conclusion, after careful consideration of the evidence of the driver, the Officer and other evidence in the case, that there was no mechanical defect at all with the lorry; and the defect was in driving dangerously and negligently. He also held that the principle of res ipsa loquitur applied to the facts of the case because the lorry hit Dr. 's car going on the right side; and this itself shows that the driver was negligent and rash, concluding his discussion as follows, in paragraph 36 of his judgment; ", "\"Lastly assuming for the sake of arguments that there was breakdown and Drag Link End came out or whatever part Opposite Party feels came out and there was mechanical breakdown although evidence is entirely contrary to such assumption but taking it for the sake of arguments only then also the Customs Officer does not know driving nor he found that any part of the vehicle had come out and it was the driver who felt that 'Buffing' and wobbling started from and yet he covered more than 2 1/2 furlongs when according to their surveyor vehicle could have been and should have been stopped within 4 to 5 ft. This itself proves negligence. .....\" ", "20. In view of this conclusion, the learned Member proceeded to consider the evidence regarding nursing expenses given by Dr. , Miss and Miss and concluded that the nursing expenses came to Rs. 1,400/- and medical expenses came to Rs. 300/-. This item of Rs. 1,700/- is not challenged before us. ", "21. The learned Member further took into consideration the income-tax returns submitted by Dr. from April 1, 1965 to March 31, 1969, from year to year; and came to the conclusion that prior to the accident the annual average income was Rs. 20,400/- and on that basis awarded damages for four years from the date of the accident. The learned Member worked it at Rs. 81,760/-. Since the accident, the total income for 3 years was Rs. 11,511/- and there was further loss of Rs. 3,530/- in the year of the accident He thus deducted Rs. 11,511/- Rs. 3,530/-Rs. 7,981/- from Rs. 81,760/- and arrived at the figure of the loss of income sustained during four years at Rs. 73,779/-. ", "22. It may at once be stated here that the figures in the returns of income-tax were not challenged before us and could not be challenged by Mr. , the learned Counsel appearing for the appellants. All that he could urge wag that the average should not have been taken as Rs. 20,440/- but as Rs. 18,000/- which was stated to be the average by Dr. in his evidence. What was contended was that the learned Member was wrong in calculating the average at Rs, 20,440/-, inasmuch as, it was admitted that something could be earned by Dr. even after the accident; and, in calculating the average loss at Rs. 73,779/-for four years the member was wrong. ", "23. Having regard to the fact that Dr, appears to have been a busy surgeon with a maternity home and consulting rooms it cannot be said particularly, when he could not stand operation for more than an hour, as reported by Dr. that the basis of the actual calculations was unreasonable or bad. We do not find any error in the learned Member calculating the loss on the basis of the average of the income-tax returns for 4 years prior to the accident and deducting therefrom the average income for 4 years subsequent to the accident. ", "24. The learned Member further added to this a sum of Rs. 63,000/- being 50% of Rs. 1,26,000/-, expected loss for 7 years and the remaindar of the life of Dr. who was, when the award was given, 63. The learned Member has correctly said that as lump sum amount was to be given to Dr. , the loss of 7 years must be reduced to 50%. As this is also calculated on the basis of the average loss calculated on the formula adopted by the learned Member, stated above, we find no error in principle therein. ", "25. All that could submit in respect of this calculation was, firstly that even a very efficient surgeon cannot be expected to continue to be efficient after 63 for 7 years and secondly it was wrong on the part of the learned Member to award Rs. 63,000/- in addition to the other sum making a total of Rs, 1,38,479/-which at the current interest rate would work out to nearly Rs. 18,000/-average loss per year as calculated by the learned Member. ", "26. The argument is no doubt arithmetically attractive but life is not all arithmetic. The learned Member who had the advantage of seeing the doctor, had come to the conclusion that he was fit enough to live for another 7 years to function like a professional man as a Doctor. There is no reason why this estimate should be considered to be wrong or against commonsense of common experience. ", "27. Although everyone, having regard to the medical facilities available to-day, wish to live longer than even 70, as the law has cast upon the and the the duty to determine compensation on the basis of estimate of life, which both wisdom and experience often show to be incorrect or futile in such matters, the tried its best and fixed it at 7 years. We cannot capriciously or arbitrarily interfere with the estimate made by the . ", "28. A professional man cannot be given a compensation at the rate of 'unearned' income, such as, interest on fixed deposits in banks. His loss must be determined having regard to his skill, ability, popularity and harm caused to his efficient functioning. In cases before the under Section 110-B , the is required by law to determine an amount of compensation which appears to be \"just\". The word \"just\" in the case of a professional man cannot mean just interest on Fixed Deposit which may be alright for a temple or a dargah or even a public and charitable institution or an old infirm or invalid man or woman incapable of functioning in life and earning by working with brain or hand. ", "29. The , in our opinion, has made the best efforts and tried to determine compensation in as \"just\" a manner as is possible in ell the facts and circumstances of the case. We are, therefore, of the view that the was quite right in awarding the quantum of compensation of Rs. 1,700/- for nursing and medical expenses plus Rs. 73,779/-for the loss sustained for 4 years plus Rs. 63,000/-, expected loss of 7 years income, making a total of Rs. 1,38,479/-. ", "30. Turning now to the first ground urged in support of the appeal that the plea of negligence set up by Dr. was not proved by him and that the accident was caused by mechanical defect of the lorry, on the facts, we find ourselves in complete agreement with the learned as it was for the lorry driver and owner to establish in this case how the lorry crossed the road dividers, went on the wrong side and virtually mounted on the fiat car coming from the opposite direction. The principle, res ipsa loquitur, was rightly applied by the learned . The evidence clearly shows that the plea of the appellants Nos. 2 and 3 in the written statement was reckless, if not a false one; and the rightly disbelieved the plea and held that it was the driver who was negligent. We fully concur in the reasons and the findings of the learned Member of the . ", "31. It would not have been necessary for us to say anything more but for the fact that it was represented to us by Counsel on respective side that the users of motor cars and lorries and the claimants of compensation before ought to know what they should plead and establish before they are entitled to avoid payment of compensation under the provisions of Section 110-B of the Motor Vehicles Act, 1939, which runs as follows:-- ", "\"110-B. On receipt of an application for compensation made under Section 110-A , shall, after giving the parties an opportunity of being heard, hold an inquiry into the claim and may make an award determining the amount of compensation which appears to it to be just and specifying the person or persons to whom compensation shall be paid; and in making the award shall specify the amount which shall be paid by the insurer or owner or driver of the vehicle involved in the accident or by all or any of them, as the case may be.\" ", "32. As the point is very important and was argued at length by , each of us has begun to feel that public interest requires that some sort of certainty in law should develop in this recently much used branch of law in the interest of safety and security of citizens in modem urban industrial society where lorries, buses and oars are killing more persons than, perhaps, all the wars that were fought by man-kind at various stages in the world's history and also in the interest of justice which must mean guidelines to the Public Sector insurance Companies and other Insurance Companies. This problem has already attracted the attention of industrial organisations and democratic countries following common law. Each of us, therefore, feel like expressing our views on the basis of the law for compensation and insurance and the right to compensation under Section 110-B of the Motor Vehicles Act. ", "33. A sound advice has already been delivered by Mr. Justice , as he then was, in , in his judgment, in , 1971 Acc CJ 219 at p. 221, para. 4:-- ", "\"It is not altogether irrelevant to observe that motor vehicle accidents in the State are increasing at an alarming rate but there is hardly any serious check by the concerned authorities to ensure careful driving. The innocent victim is faced with legal difficulties, in recovering damages. On account of the legal position laid down in v. , (FB) the insurer is liable to pay only if the insured is liable to pay. It often times happen that a prosecution precedes a civil case and since the prosecution is in the control and direction of the police if it ends in an acquittal on account of the indifference in the conduct of the prosecution the insured pleads non-liability and the insurer also sometimes escapes. Out of sense of humanity and haying due regard to the handicap of the innocent victim in establishing the negligence of the operator of the vehicle a blanket liability must be cast on the insurer, instead of its being restricted to cases where the vehicle operator has been shown to be negligent. This is more a matter for the legislature and not for the court. But this is a lacuna in the law which I think it would be just to rectify.\" (Underlining supplied). In that case compensation was claimed in respect of a tragic bus accident in the High Ranges of Kerala which resulted in the loss of 7 lives and injuries to many others. ", "34. The lower Courts had come to the conclusion that the driver was negligent; and the negligence was the cause of death of and in respect of which had granted a compensation of Rs. 2,700/- and Rs. 2,000/- respectively, directing the said insurance department to pay Rs. 2,000/- to each life lost. While confirming the decrees of s Mr. Justice made the above observations and suggestions, which, unfortunately, do not, appear to have attracted the attention of the law makers till to-day. ", "35. In v , 1971 , , considered the provisions of Section 110-A of the Motor Vehicles Act which provides for the application for compensation and Section 95 of the Act. The claimant in that case was a young girl aged about 6 years. While she was coming from her school in the evening on March 12 1963, she was knocked down by a motor truck in front of in the town of Ramgarh. As a result of the grievous injuries she had suffered on her right leg, it had to be amputated from near her thigh above the knee region. ", "36. The owner of the truck did not contest the claim. had resisted on various grounds. The Tribunal held that the claimant was involved in the accident, on the day, place, time and by the truck, as alleged by her and hence the claimant was permanently deformed and therefore, she was entitled to receive a compensation of Rs. 20,000/-. The Division Bench of confirmed this finding. ", "37. overruling, inter alia, the contention that the claimant had failed to prove negligence, observed as follows:-- ", "\" Section 95 of the Act provides requirements of insurance policy and the limitation of liability of an insurer. The insurance policy is on the record and has been marked exhibit A. We have not been shown either from Section 95 of the Act or any other provisions, or from the insurance policy (Exhibit A) whether the contention now raised has any justification. The liability is absolute but is only limited to the extent provided by the insurance policy in a particular case. ......\" ", "38. Distinguishing the facts before them from the facts in , 1966 Acc CJ 178 = (AIR 1967 Mys 11), of , laid down: ", "\"..... In the instant case, as I have stated, no case of negligence was made out in the application nor was any evidence adduced on behalf of the claimant, though the father claimant (A. W. 2) was asked in cross-examination about negligence and he said that 'the accident must have taken place because of the negligence and rashness of the driver. This is my impression'. It is thus clear that there is no evidence of negligence in the case nor was the claim founded on the basis of the negligence of the driver who drove the vehicle in question. aS such, the point decided in the Mysore case is of no assistance to the appellant in the present case.\" ", "39. In other words, although the Division Bench of has not stated so, they confirmed the decision of the awarding compensation to the girl merely on the ground that the girl was involved in the accident and suffered damages, Mr. , the learned Counsel appearing for the respondent Dr. therefore, relying on the decision, decision and the wording of Section 95 and Section 110-B and also the form prescribed under Section 110-A under the Bombay Motor Vehicle Rules, viz., Form Comp. A, submitted that none of these sections or the form requires negligence or any other fault on the part of the driver of the offending lorry to be pleaded. He submitted that the has jurisdiction to determine the compensation \"which appears to it to be just\" under Section 110-B . ", "40. Under Section 110-A an application for compensation arising out of an accident of the nature specified in subsection (1) of Section 110 may be made by the persons mentioned therein. Section 110 refers to to be constituted by for the purpose of adjudicating upon claims for compensation in respect of accidents involving the death of, or bodily injury to, persons arising out of the use of motor vehicles, or damages to any property of a third party so arising, or both, etc. etc. ", "41. Mr. submitted that whatever may be the position before , so far as was concerned, the Act is self-contained and exhaustive relating to injuries to persons and property, arising out of the use of the motor vehicle. He submitted that it was, therefore, wrong to assume that the claims must be claims on the basis of negligence or culpable negligence or that it should be based on the principle of tort as defined by the common law of England and applied by . ", "42. To repel this argument Mr. relied on several decisions: , Punjab Roadways, Ambala, ; , ; ., 1969 Ace CJ 286 (Delhi); , ; Sa-bita Pati v. , 1973 Acc CJ 319 (Orissa); v. Smt. , 1974 Acc CJ 239 (Orissa) and , (FB). He also relied on , , , , , and Mrs. v. , . ", "43. It is unnecessary to discuss these cases in detail, in none of these cases, the question as to whether the law of torts requires any fault to be the basis of liability or the question as to whether it was necessary to read the law of torts as supplementing Section 110-B was really agitated. Negligence was pleaded and denied in these cases and the question was whether negligence was established in accordance with the law of torts as applied by . ", "44. of in , , appears to have considered the point, with respect, in a somewhat indirect way and has observed in paragraph 8: ", "\"..... The objective factors which would constitute the basis of compensation appearing as just have not been indicated in the section. The expression 'which appears to it to be just' however vests a wide discretion in the in the matter of determination of compensation. Despite the wide amplitude of such power, the determination cannot be arbitrary and must be based on certain data establishing reasonable nexus between the loss incurred and the compensation to be awarded.\" ", "45. Similarly, in , a somewhat detailed discussion is to be found at the end of which of observed in paragraph 6 as follows:-- ", "\"We are therefore of the view that there is no warrant for literally importing the provisions of the Fatal Accidents Act into Section 110-B of the Motor Vehicles Act so as to read both the provisions as part and parcel of the provision. By this we should not be understood as saying that the can adopt any method which is arbitrary or capricious or in disregard of well-established principles. The decisions rendered under the general law of torts and under the Fatal Accidents Act will undoubtedly be relevant and constitute broad guidelines, but they would not be binding upon, the in the sense that the method of approach should be the same and identical as in the cases arising under the Fatal Accidents Act \" ", "It is not necessary to discuss all these cases because, in my view, in none of those cases was the question agitated as to what exactly was meant by tort in the context of automobile accidents and injuries resulting therefrom, for which more often than not human minds, hands or legs are not always accountable, in the later half of the twentieth century. The question has engaged the minds of jurists all over the common law world. ", "46. The evolution of this law is discussed lucidly by Prof. and in their article, \"Assault on the Law of Tort\" in 1975 pp. 139 to 152. They have concluded at page 146:-- ", "\"The brief re 'sume' above of the men and their theories reveals that there is no single coherent set of ideas either about the existing law of tort or about the statutory schemes to replace it. The resulting problem is obvious: if there is no complete understanding of what exactly the law of tort is all about and equally no real insight as to what the schemes ought to be achieving then any change may well be constructed on somewhat insecure foundations. Immediately it must be admitted that the existing administrative and welfare systems have multiple aims and these vary with the nature and origin of the injury to the particular individual. To aid confusion the systems tend to overlap on occasions. If we take first: the various arrangements set up by legislation can be said to attempt to give an adequate standard of living to those who have contracted diseases, lost their employment, fallen on hard times and who have grown old. But in addition the state financed benefits beyond the provision of money or services to secure an adequate standard of living since lump sums are payable for permanent disability and so approach the tort purpose of compensation.\" ", "47. Legislative attempt to give compensation irrespective of fault when the injuries are caused or death is caused by automobile accident is discussed in a very exhaustive manner in an article titled as \"Accident Compensation in New Zealand; A Comprehensive Insurance System\" in 1974 from p. 361 to p. 376. Under that Act discretion is given to the which was set up for determining compensation arising out of the automobile accident irrespective of fault as a basis of report made by Royal whose chairman was Mr. Justice . This Act provides that no claim, either at common law or under a statute, may be brought for damages arising out of personal injury or death suffered by accident in New Zealand and the Accident Compensation is entrusted with the power to determine the compensation after hearing the insurance company stated to be appellant as provided under the Act ", "48. This is referred to only to indicate how the very valuable suggestion of Mr. Justice for enacting a proper law in this connection required to be followed by the law makers of the country, rather than compel the litigants to find out the interpretation of law by different Courts and possibly after unnecessary, lengthy and costly litigation by different claimants by what is alarmingly tending to be an \" through Wonderland\" process of litigation. ", "49. In the meanwhile, I would like to interpret the sections of the Motor Vehicles Act , viz., Sections 110 to 110-F as creating a special machinery for adjudicating upon the claims for compensation for injuries to persons and property sustained as a result of the \"use\" of the motor vehicle. Section 110 uses the words \"arising out of the use of motor vehicles\" not out of improper, negligent or faulty use of motor vehicles. It is, therefore, not necessary for the to Interpret the word \"use\" as necessarily implying improper use or negligent use or faulty use. ", "50. The moment a motor vehicle is used and injury is caused, a liability to pay compensation arises; and the can adjudicate upon that liability and determine 'just' compensation. This can be on the general basis of ubi jus ibi re-medium in respect of which, we find the following comment in 10th Edition, page 119:-- ", "\"The' principle adopted by Courts of law accordingly is, that the novelty of the particular complaint alleged in an action on the case is no objection, provided that an injury cognisable by law be shown to have been inflicted on the plaintiff; in which case, although there be no precedent, the common law will judge according to the law of nature and the public good, .......\" ", "51. In my opinion, public good requires that everyone injured, viz., by the use of a motor vehicle, must immediately get compensation for the injury. Every person has a right to safety and security of his person irrespective of fault or negligence or carelessness or efficient functioning of the motor vehicle. Every person has a right to claim compensation as that is the only way of remedying the injury caused to him in a modern urbanized, industrialised and automobile ridden life. ", "52. It is useful to recall in this connection the following observations of , C.J. in v. White Et. Alios, (1703) 92 ER 126 (Lord Raymond 2) at page 136: ", "\"If the plaintiff has a right, he must of necessity have a means to vindicate and maintain it, and a remedy if he is injured in the exercise or enjoyment of it; and indeed it is a vain thing to imagine a right without a remedy; for want of right and want of remedy are reciprocal. ......\" ", "53. Moreover a look at the latest standard books on the law of Torts also reveals that when and even if importing the notion of torts in determining the just compensation it is not necessary for the to award damages only if the plaintiff proves negligence or any other tort recognised by well known books as species of tort. ", "54. In \" on Law of Torts\", 16th Edition, at page 16, there is a discussion as to whether 's theory that just as the criminal law consists of a body of rules establishing specific offences, so, the law of torts consists of a body of rules establishing specific injuries, has been discussed as follows:-- ", "\"But it is very doubtful whether 's theory is true now, or ever has been true. There is not a single case in the reports in which an action has been refused on the sole ground that it was new. It has been clearly established ever since the memorable judgment of Sir in v. that mere novelty is no bar to an action. 'I wish never to hear this objection again,' said Sir , C. J. sixty years later, 'This action is for a tort: torts are infinitely various, not limited or confined, for there is nothing in nature but may be an instrument of mischief.\" Continuing the discussion, Professor , Regius Professor of Law at , has commented:-- ", "\" said that he preferred the theory that 'all injuries done to another person are torts, unless there is some, justification recognised by Law'. But this thesis did not find general acceptance and he later modified his opinion to the extent of admitting that 'from, a narrow practical point of view' 's view 'suffices', though he still thought that 'from a broader outlook' his own theory was valid. To some extent the critics seem to have misunderstood . He never committed himself to the proposition certainly untenable now, and probably always so, that the law of torts is a closed and inexpensible system. To say that the law can be collected into pigeon holes does not mean that those pigeon holes may not be capacious, nor does it mean that they are incapable of being added to' merely contended that these changes were not exclusively referable to any single principle. In this he was probably right. The factors relevant to a decision to impose, or not to impose, liability are many and varied.\" ", "55. In \"Winfield and Jolwiez on Tort\", 9th Edition, in Chapter I, dealing with the Meaning of Law of Tort and the Foundation of Tortious liability, the discussion is as follows:-- ", "\"...... had asked, 'Does the law of torts consist of a fundamental general principle that it is wrongful to cause harm to other persons in the absence of some specific justification or excuse, or does it consist of a number of specific rules prohibiting certain kinds of harmful activity, and leaving all the residue outside the sphere of legal responsibility ?' and had chosen the second alternative. preferred the other view, but latterly he modified it as follows; From a narrow practical point of view, the second theory will suffice, but from a broader outlook, the first is valid. If we concentrate attention on the law of tort at the moment (which is what most practitioners do), entirely excluding the development of the Jaw, past and future, then it corresponds to the second theory. If we take the wider view that the law of tort has grown for centuries and is still growing, then the first theory seems to be at the back of it. It is the difference between treating a tree as inanimate for the practical purposes of the moment (e.g., for the purpose of avoiding collision with it, it is as lifeless as a block of marble) and realising that it is animate because we know that it has grown and is still growing. The caution and slowness which usually mark the creation of new rules by the judges tend to mask the fact that they have been created; for they have often come into existence only by a series of analogical extensions spread over a long period of time, to vary the metaphor, the process has resembled the sluggish movement of the glacier rather than the catastrophic charge of the avalanche. But when once a new tort has come into being, it might fairly seem to have done so, if the whole history of its development is taken into account, in virtue of the principle that unjustifiable harm is tortious. ", "Where the courts hold that the harm is justifiable, there is, of course, no tort. And they may hold that it is justifiable for any one or more of several reasons. The plaintiff may be asking them to do what they think is more fitted to do; or he may be alleging a particular tort, without giving proof of some essential requisite of it; or he may be taking an exaggerated view of what is necessary to his own comfort or prosperity; or he may be demanding the creation of a remedy which would throw out of gear other parts of the law. But subject to these restrictions and looking at the law of torts in the whole of its development, is still inclined to the first theory, \"Evidence', in the sense of judicial dicta, can be found to support either view, but, so far as is known neither forms the ratio decidendi of a single case. Furthermore, since the supporters of the second view do not deny that the law of tort is capable of development, or even that new heads of liability can come into existence, and since the supporters of the first view admit that no action will lie if the conduct which caused the harm was justifiable, the difference between them is perhaps less than is sometimes supposed. ", "Summing up his investigations into the controversy. Professor says this:-- 'The first school has shown that the rules of liability are very wide. The second school has shown that some rules of absence of liability are also very wide. Neither school has shown that there is any general rule, whether of liability or of non-liability, to cover novel cases that have not yet received the attention of the . In a case of first impression that is, a case that falls under no established rule or that falls equally under two conflicting rules -- there is no ultimate principle directing the court to find for one party or the other. .... Why should we not settle, the argument by saying simply that there are some general rules creating liability ...... and some equally general rules exempting from liability. ..... Between the two is a stretch of disputed territory with the courts as an unbiased boundary commission. If, in an unprovided case, the decision parses for the plaintiff, it will be not because of a general theory of liability but because the court feels that there is a case in which existing principles of liability may properly be extended.'\" ", "56. The time has now come when instead of involving the insurance company, which now, so far as this country is concerned, is in the public sector, and the citizens injured in automobile accidents, in costly and lengthy litigation, what is needed is a sure position in law. There is generally prolonged litigation in such cases. In the absence of any words used by the legislature to underpin the liability as a liability with respect to negligence or any other specific tort or tort generally that liability must be held to be in respect of injuries done or caused as a result of the \"use\" of motor vehicle unless there is some reason recognised by law for exempting the user from that liability. ", "57. It is true that there are crosscurrents of thoughts in the matter. Even in England judges have taken different views with regard to the necessity for proof of fault in actions for personal injuries caused by accidents. 's Law of Torts has summed up this discussion with the following words:-- ", "\"It is reasonable to conclude that there is still room for the law of torts. Basic cover against disasters may be provided by national insurance, but there is a popular feeling that those who have intentionally or carelessly caused harm to others should pay for the damage which they have caused. Tort law is concerned not only with cash, but also with appeasement, justice and fairness. Experience with industrial accidents shows that social welfare and common law damages may well co-exist. Perhaps torts should not be abolished, but amended and supplemented: it can deal better than insurance with property damage and mental suffering, and can also provide for the restoration of earnings above the minimal level. For statutory benefits have the disadvantage that they are not in any way related to the loss suffered, as common law compensation is, however, inadequately. There is room for much more inquiry as to the relationship between the law of torts and the welfare state. The whole problem of alternative remedies needs to be re-examined.\" ", "58. In the light of this fundamental and basic nature of the law of torts, I am of the view that whether we apply the law of torts or not. the liability to pay 'just' compensation arises when the injuries are caused by the use of the motor vehicle. The has power to determine, what is 'just' compensation irrespective of whether the defendant was at fault or was negligent or careless or not. When a person is injured by use of a vehicle, that itself is an infringement of a right. That person must, therefore, have a remedy of recovering compensation from the person whose vehicle has caused injury. That, according to me, is the scheme of the provisions contained in Sections 110 to 110-F of the Motor Vehicles Act. Principles of law of negligence were relevant for determining the quantum of damages and the person liable to pay it like any other principle to be followed in the administration of justice. ", "59. It was contended by Mr. that these were only procedural sections as held by recently in , and in some other decisions of other ; but, with respect, that case was concerned with and arose out of the facts of those cases where the point as to whether the law was substantive or procedural arose in the context of the plea of bar of limitation. ", "60. Except when such distinction is relevant, in interpreting the law, one should not approach the law as if the law was intended to be labelled or christened as procedural or substantive law. It is clear from Section 110-B that the law requires the to decide not only what is \"just\" compensation but also to whom it should be paid and by whom it should be paid. Some of those sections will have to be interpreted as substantive law if at all it is necessary to interpret them to be so. In my view, it is unnecessary to go into semantics of the words \"substantive and procedural law\" in the present case. It is enough to say that Dr. was inflicted injuries by use of the motor lorry belonging to the Appellants Nos. 2 and 3 and they are, therefore, liable to pay compensation to Dr. as awarded by the . ", "61. Mr. contended that, having regard to Section 95 , which lays down the requirements of policies and limits of liability in respect of policy of insurance against third party risks, the words used are \"any liability which may be incurred\"; and, therefore, it must be a liability under the general law of torts or under the Civil Law. But it is not necessary or proper to read that section in such a way because liability could be any liability.\" It may be civil or it may be criminal. It may be contractual or based on tort or a statute. Merely because the word \"liability\" is used in that section, it cannot be said that the 's jurisdiction under Section 110-F is limited to considering and applying the law of torts in a claim for compensation. ", "62. Mr. also referred to the word \"liability\", used in Section 96 and contended that word \"liability\" would also mean liability which will be recognised by . It may be so. But that section again does not limit the power of the under Section 110-B which has to determine while making the award, as stated above, not only what is \"just\" compensation but also specify the amount which shall be paid by the insurer or owner or driver of the vehicle involved in the accident or by all or any of them, as the case may be. Section 96 in my opinion, applies only to the judgment obtained in which has no jurisdiction where the Claims is constituted in view of the provisions of Section 110-F . ", "63. In any view of the matter, therefore, whether negligence is taken into consideration or not. the award passed by the in the present case is just and legal. There is nothing therein which requires interference at our hands. Mr. submitted that under Section 95 (2) the policy of the insurance in the present case limits the liability of the insurance company to Rs. 20,000/- as that was the limit prescribed under Sub-section (2), as it was in force at the time of the accident; and, therefore, insurance company-appellant, should be held liable only to the extent of Rs. 20,000/-. ", "64. As can be seen from the record and particularly the roznama, no point appears to have been raised on behalf of to limit the liability under the policy to Rs. 20,000/-, by Mr. , who filed the written statement on behalf of the opposite parties. The policy is not before us. Not only that but when Mr. , who filed the appeal on behalf of all the opposite parties, the appellants, raised this point, Mr. , who was present in the , interrupted and said that it was the practice or convention of the insurance companies not to raise such a point before the if the insurance company represented the assured as in the present case. Mr. , therefore, contended that the insurance company should not be allowed to raise this point for the first time before us on behalf of Appellants Nos. 2 and 3. ", "65. But he had not filed any vakalatnama on behalf of Appellants Nos. 2 and 3 before us. He had filed his vakalatnama before the . In the absence any vakalatnama filed by Mr. on behalf of Appellants Nos. 2 and 3, it is not open to us to take into consideration his submissions on their he-half. On behalf of Dr. , the claimant. Mr. submits that the insurance company should not be allowed to raise the point of limiting the liability of Rs. 20,000/- for the first time in this Court as they have not raised a contention in the written statement filed before the that the policy did not cover the entire liability which the assured may incur under the award. ", "66. There is considerable force in the argument of Mr. . But having regard to the fact that Mr. represented the assured as well as the insurance company in the lower , it may be that as the contention of liability available to the insurance company under Section 95 (2) was not raised before the , in fairness, an opportunity should be given to the insurance company to raise such a point if it is open to it at law to do so subject to the payment of costs and also subject to depositing the amount which according to them is payable under the award, viz. Rs. 20,000/-, with interest from the date of the application as awarded by the . ", "67. If and when the certificate of execution is to be issued by the under Section 110-E of the Motor Vehicles Act the question may be raised by the Insurance Company. At present we are not bound to interfere with the award of the . There was no' material or argument before the about it. There was nothing before the to show that the insurance company's liability was limited to Rs. 20,000/- ", "68. In the result, I would confirm the award and dismiss the appeal subject to the modification that it is open to the insurance company Appellant No. 1, to deposit Rs. 20,000/- with interest from the date of the application to the date of the deposit as per the award passed by the and contend that the award is binding under Section 95 (2) of the Motor Vehicles Act but only to the extent of Rs. 20,000/- or the sum which may be mentioned in the insurance policy. ", "69. If and when the insurance company deposits the amount as directed above and applies for determination of this question, the may proceed to determine that question after hearing all the parties concerned and then issue the certificate for recovery of the balance of the awarded money under Section 110-E of the Motor Vehicles Act from So far as others are concerned, the is at liberty to issue certificate of execution forthwith. As an extraordinary indulgence is given to the insurance Company on a plea which it has raised for the first time before us, the insurance company , should pay the costs of all parties to this case so far incurred and to be hereinafter incurred. ", "Mridul, J. ", "70. I respectfully agree with the findings and the conclusions of my learned brother. The question as to whether gist of cause of action, in a claim arising out of a motor accident is negligence, is of great importance. This question also arises in appeal No. 81 of 1975, which has been heard with this appeal. In view thereof as also because of a slightly different process of reasoning adopted by me, I think it necessary to deal with this important question relating to interpretation of the provisions of Section 110-B and cogent sections of the Motor Vehicles Act , 1939, (hereinafter referred to as \"the Act\"). ", "71. , the learned counsel for the 1st appellants -- (Insurance Company) -- (hereinafter referred to as 'the insurer'), submits that in all cases of compensation arising out of accidents contemplated by Chapter VIII of the said Act, the basis of liability is negligence as known to the law of Torts. His submission is that provisions of Chapter VIII, particularly those relating to the constitution of , are procedural sections. The said provisions do not provide for the basis of liability or the principles governing the exercise of power vested in the for awarding compensation. In order to ascertain the liability the , of necessity, must look to what are called the substantive provisions of Law of Torts and the Fatal Accidents Act . It is a submission of the learned counsel that there is nothing in the provisions of Chapter VIII which touches the basic question of liability arising out of accidents and that the provisions of the said Chapter have not changed the law which existed prior to the bringing into force of the relevant provisions. The learned counsel asserts that the provisions of the Act cannot be held to override the law of Tort or of Fatal Accidents Act and the liability for compensation must be determined with reference to the said substantive provisions alone. ", "72. , the learned counsel for the Respondent (hereinafter referred to as 'the injured') submits that upon a true construction of provisions of Chapter VIII and more particularly. Section 110-B , negligence is not the basis of the liability. The cause of action in cases of injury in accidents is the loss and damage sustained by reason of death or bodily injury caused by or arising out of the use of a vehicle in a public place. ", "73. In order to resolve these controversies it will be necessary to see the language in which the relevant provisions are couched as also the scheme, intendments and the purpose thereof. It will have to be seen whether the relevant provisions of the Act provide for a basis of liability in connection with accidents wherein motor vehicles are involved or that said provisions merely lay down the mode and the forum through which the rights and liabilities which are claimed to arise only under the substantive provisions of law as aforesaid, are enforced or adjudicated. ", "74. The Act is an Act \"to consolidate and amend the law relating to Motor Vehicles\". As a Consolidation Act, it therefore, merely reduces into a systematic form the whole of the law that existed prior to its enactment. A Consolidation Act by itself cannot be said to intend a change in the pre-existing law but the Act is not merely a Consolidated Act. It is also an Act which seeks to amend the law relating to motor vehicles. The controversies in this appeal therefore will have to be determined by interpreting the relevant provisions of the Act read within the setting of the Scheme, intendments and purposes thereof. ", "75. Chapter VI of the said Act deals with 'Control of traffic'. It makes elaborate provisions for regulating use of a motor vehicle in public places. Section 71 provides for limits of speed. Section 72 deals with limits of weight and limitation on use. Section 74 empowers to prohibit or restrict driving of motor vehicles 'in the interest of public safety or convenience or because of the nature of road or any bridge'. Section 75 provides for placing or erection of traffic signs. Section 76 authorises or other authority designated by the in that behalf, to determine 'places at which motor vehicles may stand' or places at which public vehicles may stop. Section 77 provides for designation of certain roads as main roads for the purposes of regulations contained in the tenth Schedule. The said Tenth Schedule enumerates driving regulations to be observed by a driver of a motor vehicle. Section 78 casts obligations for safe driving of the motor vehicles. It provides that a driver of motor vehicles 'shall drive the vehicle in conformity with traffic signs and regulations set forth in Tenth Schedule. Section 79 provides for signals and signalling devises and for the directions that a driver of a motor vehicle is obliged to follow. Section 81 casts an obligation upon the person in-charge of a motor vehicle to ensure that the vehicle is not left in a dangerous position so as to cause 'danger, obstruction or undue inconvenience to the other users of the road'. The other sections need not be noticed. Mention however, may be made of Section 91 which empowers the to make rules. Clause (i) thereof authorises the to make rules providing for \"generally, the prevention of danger, injury or annoyance to the public or any person or of danger or injury to property or of obstruction to traffic\". The provisions of Chapter VI leave no shadow of doubt that the said provisions impose liabilities and obligations on drivers of motor vehicle and that the provisions enacted therein are conceived with a view to protecting the persons who might be using a public road from \"danger, injury or annoyance to their persons or properties\". Even in England before statutory provisions were made, there existed what was called a High Way Code. The English judgments show that a failure on the part of any person to observe any provisions of the High Way Code, gave rise to actionable wrongs or to civil liabilities. In civil proceedings such failures were permitted to be relied upon as \"tending to establish or negative any liability which may be in question\" (Halsbury's Laws of England, 3rd Edn. Vol. 28, page 66). This non-observance was treated as a specie of negligence in relation to High ways. Stronger becomes the case when the statutory provisions are made and they set forth obligations upon the driver of a motor vehicle so as to prevent mischief \"of danger or injury or annoyance to the public or persons or of danger or injury to property\" of others. Breaches of these statutory obligations, ex hypothesi must predicate liabilities enforceable at law. Chapter VIII relates to insurance of Motor Vehicles against third party risks. It comprises of Section 93 to Section 111-A . Some of the salient provisions thereof may however, be noticed. ", "76. Section 94 (1) ordains that no person shall use (except as a passenger) or cause or allow any other person to use a motor vehicle in a public place, unless there is in force in relation to the use of the vehicle by that person or that other person as the case may be a policy of insurance complying with the requirements of Chapter VIII. Section 94 (1) is modelled on Section 85 (1) of English Roads Traffic Act, 1930. There is considerable judicial opinion to show that Section 35 (1) of the English Roads Traffic Act, 1930, provides for a statutory duty enforceable at law. ", "77. In v. (1935-1 KB 75), one was injured in a car accident. The car belonged to one . 's friend one had borrowed the car from and had asked one to drive it for, him. and were not covered by 3rd party liability insurance. 's policy also did not cover the use of a car by and . sued basing his claim against upon the alleged breach by of his statutory duty under Section 35 (1) in having caused or permitted his motor car to be used in breach of the Sub-section. , J., upheld the claim on the grounds that Section 35 imposed a duty and that injury to any person on road in breach of the said section could be relied upon as a cause of action. In appeal Judgment of , J., was affirmed. held that the owner can be sued for breach of statutory duty and the injured need not first sue to uninsured person who caused the accident. (1935) 1 KB 75. The dicta in 's case was followed by , J., in v. , reported in (1934) 50 LI LR 88. on 2nd Edn. writes at page 164 as follows:-- ", "\"It was held in v. and in several later cases, that a breach of this statutory duty is a wrongful act giving rise to claim for damages by a third party who is injured through the use of a motor vehicle in breach of the duty.\" ", "78. By the same token therefore, the provision of Section 94 (1) of the Act must be held to cast a statutory obligation, the breach whereof is enforceable by an appropriate action in an appropriate forum constituted in that behalf. ", "79. Section 95 (1) lays down 'requirements of policies and limits of liabilities'. Clause (b) of Sub-section (1) requires that a policy of insurance must \"ensure the person or classes of persons specified in the policy to the extent specified in Sub-section (2) -- (i) against any liability which may be incurred by him in respect of the 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; and (ii) 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. The provisions of Section 95 (1), more particularly, Clauses (b) (i) and (ii) thereof delineate the extent of the liability which is considered minimum that should be ensured to a third party involved in an accident caused by or arising out of the use of the vehicle in a public place. The key-concept in the provisions of Sub- section 95 (1) (b) is a liability in respect of death or an injury \"caused by or arising out of the use of the vehicle in a public piace\". That the said concept is a cardinal one, is the inference that must be drawn because in the first place it is the common streak which runs through both the Sub-clauses (i) and (ii) of clause (b) of Section 95 (1) and Sub-clause (i) has to be read as 'Noscitur a sociis'. These two Sub-clauses of Section 95 (1) must get their colour from each other. These Sub-clauses are part of the same scheme relating to minimum insurable risk that must be covered and cannot therefore be interpreted differently. Secondly, the word, ''arising out of or caused by\" are the words of widest amplitude specifying the critical event. They clearly indicate that the liability must be such as pertains to death or bodily injury or damage to the property caused by or arising out of the use of the vehicle in a public place. In other words, a causative factor postulated by the aforesaid provision, is the use of a vehicle in a public place. This is so because in the focus of the provisions of the Act, particularly Chapter VI and Chapter VIII is the use of a motor vehicle and its proper regulation in order to ensure safety to the people and their property. ", "80. There is yet reason to hold that the emphasis in Section 95 (1) (b) is on the liability pertaining to an accident resulting in death or bodily injury or damage to the property of the third party by reason of the use of the vehicle in a public place. Section 95 (1) is a provision relating to insurance. The law of insurance contemplates coverage of perils or events resulting in injuries. These perils and events are insurable factors. In the language of insurance, these perils or insurable .events or factors are called \"risks\". (Laws of England. 3rd Edn., Vol. 22, page 229) classifies these perils, events or factors in the following words: ", "\"There are three broad topics to be considered in relation to what in commercial parlance is called the risk, namely (1) the risk in the sense of the contractual definition of the peril insured against; (2) the risk in the sense of the subject-matter insured against the stipulated peril; (3) the risk in the sense of the circumstances in which the stipulated peril has To affect the assured, either in relation to a defined subject-matter or in relation to his incurring a particular liability or loss\". ", "81. Under Section 95 (1) insurable contingency which is the minimum that has got to be provided for in accordance with the provisions both of clauses (i) and (ii) is \"the death or bodily injury, caused by or arising out of the use of the vehicle in a public place\". Clause (i) further adds damage to the properties also. The subject-matter of the insurance is the motor vehicle; circumstances covered are the use of motor vehicle in a public place and the peril insured is the loss arising out of death or bodily injury. These are the factors or events in respect whereof there has got to be a policy of insurance it the provisions of Section 95 (1) (b) are to be complied with. ", "82. The learned counsel for the insurer, however, submits that the liability as contemplated by Section 95 (1) (b) (i) is a liability which 'may be incurred by' the insured. He emphasises the expression \"incurred by him\" and submits that the Court should hold that this incurring of a liability has to be determined not with reference to the provisions of the Act but with reference to the rules, of Law of Tort or other substantive laws. The contention is untenable. The expression liability \"which may be incurred by him\" is used to identify the liability, not to qualify or restrict the liability. It merely answers 'Whose liability and not, what liability'. The perimeters of liability in clauses (i) and (ii) must be held to be the same because in both the events the liability of the owner or the driver exists and is made compulsorily insurable. The' only difference is that clause (i) deals with vehicles other than 'public service vehicles' where passengers are gratuitous invitees as contradistinguished from passengers in public service vehicles who are carried for 'hire and reward'. The latter cases require specific reference to exclude defences of 'volenti not fit injuria' or persons not entitled to compensation as _ being contractees to the contract of conveyance. It is inconceivable that the legislature would intend absolute liability only in cases covered by clause (ii) and not in cases covered by clause (i). ", "83. It may also be stated that the liability of the insurer is for indemnification of the insured. This liability is coextensive with the liability of the insured. Consequently insurable events must be same for both and their respective liabilities must be conterminous. Inferentially therefore the delineations of liability for minimum insurable cover must also denote the contours of liability of the insured. If that is so, the minimum contemplated by the said provision also indicates the basis of insured's liability. ", "84. Sections 97 , 09 . 101 and 102 show that the Act makes a departure from Law of Torts. The principles enshrined in the said provisions are different from those relating to the law governing the joint tort-feasors. The liability arising out of a joint tort carries with it certain well defined legal consequences. The liability of joint tort-feasor abates with that of the other joint-tort-feasor. The joint-tort-feasors can make a settlement between themselves to limit their inter se liability, that is to say, contribution to be made by each in regard to the joint torts. The discharge of one of joint tort-feasors operates as the discharge of the liability of the other tort-feasors. None of these feature obtain in cases covered by the said sections. Section 97 passes on the right of the insured in the event of his insolvency or if it is a corporation, its winding up, to the third parties Section 99 prohibits any settlement between an insurer and the insured unless the third party is a party to such a settlement. Section 101 in terms provides that insolvency of the insured will not affect the claim of the third party once a certificate of insurance is issued. Section 102 is more tale-telling. Contrary to the well-settled principles of tort to the effect that the tort does not survive the demise of the tort-feasor, Section 102 provides that death of a person in whose favour a certificate of insurance is issued if it occurs after the happening of an event which has given rise to a claim under the provisions of said Chapter VIII \"shall not be a bar to the survival of any cause of action arising out of the said event against his estate or against the insurer'. These departures from the principles of Law of Tort, clear on the plain and unambiguous language of these sections, establish that the intended to lay down a different law in the matters governed by the provisions of the Act. ", "85. Argument of the counsel for the insurer that an insurance is merely an indemnification to the insured breaks down when it is seen that departure has also been made from the principle that the liability of the insurer should be co-extensive with that of the insured. It is a normal rule of Jaw that in cases of principal-debtors and sureties, their liabilities are co-extensive. The surety is entitled to defend a claim inter alia upon the grounds available to the principal debtors but that is not s. under the provisions of the said Chapter VIII. Section 96 (2) gives a very limited right of defence to the insurer. The provisions of Section 96 (1) contemplate hearing on the merits only between the third party claimant and the insured. The injunction of Sub-section (1) of Section 96 is that the insurer is liable to the extent of the sum assured on a judgment in respect of the liability covered by the policy under clause (b) of Sub-section (1) of Section 95 upon the judgment being obtained against the insured. This is different from a situation where a claim against a principal debtor and a surety is made under the general law. In my opinion, the provisions referred to above, clearly establish the legislative intent to make departures not only from the law of torts, but also the Law of Contract-in so far as the insurer and the insured in the matter of claims for compensation arising under the said Chapter are concerned. ", "86. The provisions of the Act are different from those of Fatal Accidents Act which in term provide for 'actionable wrongs' and for compensation arising therefrom. Section 1-A of the Fatal Accidents Act provides for compensation to the family of a person for loss occasioned to it by death 'caused by wrongful act, neglect or default'. The preamble also indicates the same things. The having not used the same language in the Act clearly shows that the scheme thereof is different from that of Fatal Accidents. Act. ", "87. Before I go to the most material section viz., 110-E, it is necessary to notice expressions used in Sections 109 , 110 , 110-A and 110-AA . In these sections legislature has used the expressions \"claim compensation in respect of an accident arising out of the use of a motor vehicle\" ( Section 109 ); \"claims for compensation in respect of accidents involving the death of, or bodily injury to persons arising out of the use of motor vehicles\". Sub-section (1) of Section 110 : \"for compensation arising out of an accident of the nature as specified in Sub-section (1) of Section 110 \", and \"a claim for compensation under this Act\" ( Section 110-AA ). These expressions clearly demonstrate that the compensation that is payable is a compensation which arises out of an accident and which is payable under the provisions of the Act. There are no words of limitation. There is nothing in the provisions of the Act or Scheme thereof which can justify the importation of limiting factors to restrict plain meaning and amplitude of these expressions. In my opinion, reading down of all these sections will be an unjustified departure from canon of literal construction. There are no compelling reasons to induce me to do so. In my view, a mere surmise or conjecture that the law of Torts is all comprehensive and must therefore govern all cases of compensation, is no ground to strain the language of these provisions or read implied limitations in them. Moreover, such restrictions or limitation besides being repugnant to the natural meanings of the said expressions, also defeat the salutary purpose of Chapter VIII which is to benefit third parties and indemnify them against loss and injury arising out of Motor accidents. ", "88. Section 110-B has a marginal note which summarises 'the effect of the section.' The marginal note reads \"award of the claims .\" Thus the section deals with the jurisdiction of the to make award granting compensation. Undoubtedly, this section creates a forum and therefore to the said extent it is a procedural provision. But it is well-settled proposition of Law that a procedural section may contain in itself substantive provisions. Legal semantics apart, there is no dichotomy between a substantive provision and a procedural provision: The intent of the law has to be gathered from the language of the law, the scheme of the law and the purpose of the law. The crucial words in Section 110-B are \"the Claims ...... may make an award determining the amount of compensation which appears to it to be just and specifying the person or persons to whom compensation shall be paid\". This section in other words authorises the tribunal to award such compensation 'as appears to it to be just'. There are no words of limitation in this section whittling down the scope of the authority of the tribunal to award such compensation as appears to it to be just. In v. , , considered the ambit of power conferred by this section. observed in paragraph 6, page 1626 as under :-- ", "\"Under Section 110-B of the Motor Vehicles Act, 1939, the tribunal is required to fix such compensation which appears to it to be just. The power given to the tribunal in the matter of fixing compensation under that provision is wide.\" ", "89. Implicit in the observations of is the assumption that the width of the power under Section 110-B is not subject to any implied limitations. This would be so because all judicial powers carry with them an implication of a corresponding right in the persons entitled to invoke the jurisdiction of such an authority. Juristically speaking power is correlative of a corresponding right in the aggrieved person. Thus the tribunal being empowered to award such compensation 'as it may deem fit', connotes a corresponding right, as a jural correlative, in the person injured to have, other things being a satisfied, such compensation awarded to him. This compensation has to be such as appears just to the tribunal in the circumstances of the case. I am unable to read any limitations either of express or implied character, into the sweep of the power which is conferred upon the tribunal by the plain and unambiguous language of Section 110-B . ", "90. The provisions of Chapter VIII noticed above interlace and interwine. They produce a matrix which is clear. The scheme is that certain perils or risks have got to be compulsorily provided for by an insurance cover. These perils are those which arise out of the use of motor vehicles on a public road and which result in the injury of the description specified by the said provisions. This minimum compulsory insurable coverage is buttressed by the legal sanction under Section 95 (1) of the Act, which prohibits persons from using a motor vehicle without an insurance policy which provides for a minimum injury coverage contemplated by Section 95 (1) (b). The minimum insurance coverage carries with it an explicit obligation in the person involved to pay compensation, otherwise the whole meaning or the purpose or the intendment of minimum insurable coverage will be rendered nugatory. There is, thus, in my opinion, no warrant either in the language of the law or purpose of the law to whittle down the scope of the liability contemplated by the provisions of Chapter VIII of the said Act. ", "91. Several authorities were cited by Counsel for the insurer in support of his submissions. The learned counsel for the injured also called attention to several authorities which held to the contrary. The authorities cited at the are the authorities for the propositions, whether the provisions of the Act are procedural in character or are substantive in character, and whether the provisions of the Act, particularly Chapter VIII thereof, are a Code contained in themselves. The said judgments reveal a cleavage of judicial opinion. The view taken by of Punjab, Orissa and Madhya Pradesh is that the provisions relating to the constitution and the powers of tribunal contained in Chapter VIII are procedural in character and are not a complete Code in themselves. In the view of the said , the basis of liability under Section 110-B is to be found in the substantive provisions of Law of Torts or the Fatal Accidents Act . The two Division Benches of in , and in , reported in 1974 Acc CJ 182 (Mad), have also taken a similar view. As against it, the view of is that the said provisions are a self-contained Code. This view of is shared by a Division Bench of in , . ", "92. It is unnecessary to refer to all the authorities or analyse observations made therein. It would however, be sufficient to consider a few which are comprehensive and are representative of the trends referred to above. , , the single Judge of took the view that in a claim arising out of a motor accident before , the tribunal has to determine the question of liability with reference to the Law of Torts. The learned Judge observed at page 542 as under:-- ", "\"It is true that Section 110-B of the Motor Vehicles Act does not in terms lay down that it is only when negligence on the part of the driver of the vehicle concerned is established that compensation can be awarded, but then it should be borne in mind that this bunch of Sections 010 to 110-F ) merely deal with the subject of the substitution of Accidents Claims Tribunal in place of for the purpose of adjudicating on claims for compensation in respect of accidents involving the death or bodily injury to persons arising out of the use of motor vehicles. They do not deal with the question as to who is to be held liable and in what circumstances, if any injury results from an accident. In order, therefore, to discover the criterion or test for fixing liability, we have, in the absence of any statutory provisions fixing liability irrespective of negligence, to turn to the law of Torts according to which indisputably negligence in causing the accident in question is generally speaking essential to hold the negligent person liable.\" ", "93. It is not very clear from the judgment as to whether the in that case was called upon to decide the connotation of the expression \"may make an award determining the amount which appears to it to be just\" or whether attention was drawn to the scheme of the Act as unfolded by the relevant provisions of Chapter VIII or of the provisions of Chap. VI. There is no discussion as to the intendments or purpose of the Act or the pattern disclosed by the said provisions. The judgment proceeds on the assumption made that the fasciculus of the Sections 110 to 110-F merely deal with 'subject of substitution' of one forum for the ether. ", "94. , , of the Madhya pradesh noticed the aforesaid Judgment of and other Judgments in which it was followed. took the view similar to the view taken by . The Full Bench of did examine the provisions of Chapter VIII. It opined that Sections 94 to 96 provide for compulsory insurance of motor vehicles and lay down the liability of the insurer to pay the claimant directly. It also observed that Sections 110 to 110-F lay down the procedure for enforcement of substantive rights of the claimants as enlarged and circumscribed by Section 96 . Notwithstanding the fact that noticed the \"substantive rights\" and 'enlargements', it took the view that the liability had yet to be governed by the principles of negligence of the owner and the driver. This view was taken upon the footing that the said provisions are mere indemnity provisions. The Full Bench then proceeded to observe at page 9 as follows:-- ", "\"However, the ingredients of the liability of the insurer are nowhere, provided in this special statute. Necessarily, therefore, the aspect of the matter will be governed by the general substantive law, which remains untouched by this special law. We have already shown that it is on the contract of indemnity that the insurer is liable to pay compensation only it the insured is liable to pay damages to the claimant. If the insured is not liable, then the insurer is also not liable. In other words, the liability of the insurer depends upon the liability of the insured. Now, the liability direct or vicarious of the owner of a motor vehicle involved in an accident resulting in injury to, or death of, a third party, to pay damages arises from the law of torts. Under that law, negligence of the owner or driver is the sine qua non for such liability.\" ", "95. I respectfully dissent from the view taken by of . As already seen above, the Scheme of Chapter VIII militates against the incorporation of Law of Torts as inhibiting factors or sole principles governing exclusively the question of compensation payable under the provisions of the Act. Such an interpretation detracts from the plain and unambiguous language of Section 110-B or whittles down the sweep of 's power thereunder. It renders the expression \"compensation which appears to it to be just\", otiose. There is no reason why the could not have used the expression \"such compensation as is payable in law\" if Law of Torts or other substantive provisions were intended to apply to cases of compensation under the Act. Furthermore, as will be seen later negligence as the sole basis of liability is a principle which of late has not found favour with several courts in England. In my respectful opinion the observations of the Chief Justice in the order of reference to , are more apposite and accord appropriately with the scheme of the Act as also the legal trends in vogue in the realm of torts. ", "96. , reported in 1974 Acc CJ 182, a of also took the view that the provisions of Sections 110 to 110-F , were procedural, and that the substantive provisions of law relating to determination of liability are to be found under the law of torts or the Fata) Accidents Act. The dealt with the controversy as to whether the said provisions are complete Code. It referred to the judgment of in M/s. Sheikhupura Transport Co. Ltd., (supra) where the said question was kept open. The said held that the said provisions were procedural in character and were not a Code complete in themselves,. According to it, the said provisions did not create any new rights. The observed in para. 37 at pages 197 and 198 as follows.-- ", "\"One of the contentions raised on behalf of the appellants is that as Section 110-B of the Act speaks of the making \"an award determining the amount of compensation which appears to it to be just\", the powers of the are independent of the provisions of the Fatal Accidents Act (as well as that under the Legal Representatives' Suits Act ) and that therefore the provisions of the Act must be construed as substantive provision and not merely procedural in character. This contention is fallacious. It is true that the has to determine \"the amount of compensation which appears to it to be just\". But the question is, compensation for what. If it is a claim by an injured person, he can certainly claim compensation for the pain, suffering, etc., loss of earning, other pecuniary loss arising out of the injury and shortening of expectation of life, if any, provided the injury or injuries had been caused by a tortious act by the owner of the vehicle, by himself or vicariously. So, even though the Claims is given power to determine the amount of compensation which appears to be just, it has necessarily to look to the law of torts in determining such 'just compensation'. Similarly, in case of death due to injuries just compensation awardable by the tribunal should naturally be only towards loss of benefit, if any, and loss of estate, if any provided again that the death was caused by a tortious act. Therefore, by the mere use of the words \"compensation which appears to it to be just\" in Section 110-B , the relevant provisions of the Act ( Sections 110 to 110-F of the Act) cannot be said to create new rights or liabilities-It can never be contended that these provisions in the Act are in any way meant to alter or amend the pre-existing law relating to substantive rights and liabilities of the parties.\" ", "97. Dealing with an earlier Division Bench Judgment of the same viz., , (), the said Bench merely observed that \"the learned Judges who decided would hot have made the observations if the decision of the earlier Bench in , was brought to their notice\". There is no other discussion which goes to throw light on the scheme of the law as discussed above or the purposes and intendments which are disclosed in the relevant provisions of the Act. ", "98. With great respect I am unable to appreciate riders engrafted in para. 37 of the said judgment referred to above. In my opinion, it does not follow from the expression 'amount of compensation which appears to be just' that such compensation can be given only if \"injury or injuries are caused by a tortious act of the owner of the vehicle\". This amounts to reading something into Section 110-B , which is not there. It is an unjustified constraint on the width of the power envisaged by the said expression. What is a just compensation depends on the facts of a given case as appreciated by the tribunal. This appears to have been appreciated when it is observed \"just compensation awardable by the should normally be towards loss of benefit, if any and loss of estate if any\". There is, however, no reasoning given as to why this loss has to be compensated subject to the proviso, \"provided again that the death was caused by tortious act.\" ", "99. In my respectful opinion, the view taken by of in ) appears to lay down the law correctly on the subject. At page 477 considered Section 110-B and more particularly the expression 'the compensation which appears to it to be just'. Giving effect to said expression, in 's case ruled that: ", "\"It is enough to hold that the word 'just' in Section 110-B of the Motor Vehicles Act has been used in a very wide and comprehensive sense.\" ", "100. With respect, these observations are fortified by the dicta of in , () wherein characterised jurisdiction under Section 110-B to be wide. That being the position, it is difficult to understand as to how the stubborn text of Section 110 can be bent to accord with an a priori, but fragile concept that all legal injuries can be compensated only upon the ground of negligence and not on the footing of absolute statutory liability or of being an insurable event covered by a policy of insurance in that behalf. ", "101. Counsel for the insurer calls attention to a judgment of in insurance , , as an authority for the proposition that Section 110-B is merely a procedural section. Says the counsel -that no substantive provisions can be read therein and that being so, the provisions of law of Torts or of the Fatal Accidents Act must be held to be applicable to cases arising under Chapter VIII of the Act. I am afraid, this is a mis-reading of the judgment of . ", "102. In case (supra) an accident took place on 11th September, 1966. On the date of the accident was constituted under Section 110 of the Act. was constituted by a notification published in the gazette dated 18th March, 1967. The injured filed an application under Section 110-A on 8th July, 1967. The owner and the insurer objected to the jurisdiction of the tribunal to entertain the application. The objection having been overruled by the tribunal, the owner and the insurer filed a writ petition challenging the jurisdiction of the tribunal. The view taken by was that the tribunal had the jurisdiction to entertain the application. In the appeal therefrom to the question which arose was as to whether the provisions of Sections 110-A and 110-F were retroactive in operation. No question as to the interpretation of Section 110-B arose before the . Dealing with the Section 110-A and Section 110-F took the view that the said sections merely provided for a change of law of forum. It was in this context that interpreted the said Sections 110-A and 110-F and held them to be procedural. The observations of at page 240 para. 6 are as follows:-- ", "\"In our opinion in view of the clear and unambiguous language of Sections 110-A and 110-F it is not reasonable and proper to allow the law of change of forum give way to the bar of limitation provided in Sub-section (3) of Section 110-A . It must be vice versa. The change of the procedural law of forum must be given effect to. The underlying principle of the change of law brought about by the amendment in the year 1956 was to enable the claimants to have a cheap remedy of approaching on payment of a nominal -fee whereas a large amount of ad valorem court-fee was required to be paid in . It is legitimate to think that the legislature did not think It necessary to affect the pending suits but wanted the cheap remedy to be available as soon as the tribunal was constituted by in all cases irrespective of the date of the accident, provided the remedy of going to the was not barred on the date of the constitution of the tribunal. Then how is the difficulty of limitation in such cases to be solved is the question.\" ", "103. With great respect, that is the exposition of law by relating only to Sections 110-A and 110-F of the Act. These observations are no authority for the propositions canvassed on behalf of the insurer. On the contrary, the dicta of the supports the converse. Respectfully paraphrasing it, it can be that in view of clear and unambiguous language of Section 110-B it must be said that the tribunal is empowered to award such compensation as it deems just. The language being clear and unambiguous, as the itself lays down, effect must be given thereto. The provisions of Section 110-B provide not merely for a cheap and expeditious remedy but also an effective remedy untrammelled by considerations of law of Tort or other laws, ", "104. In my opinion, the infirmity of the argument of the counsel for the insurer lies in his ignoring vital and effective distinction between, the two concepts of law of compensation or law of liability, viz., the basis of liability and the extent of liability. However, the learned counsel cannot be blamed. on Damages, 13th Edn. page 51 summarises accurately the whole position in the following words; ", "\"In considering the general problem of the limits of compensatory damages there arises first a difficulty which is never very far away in problem of damages but which is at this point at its most acute. This is the difficulty of distinguishing the question of the existence of a liability to pay damages from the question of the extent of a liability to pay damages. Strictly the first does not concern damages at all, but in dealing with the second it is very difficult to disentangle the two questions. This is the case far more in tort than in contract, and par excellence in the tort of negligence\". ", "\"The difficulties are increased by the fact that there is an overlapping of concepts, and the same problem may sometimes be dealt with as a question of existence of liability and sometimes as one of extent'.' ", "105. Even so these two concepts have to be treated separately because both in point of fact and as a matter of law they are separate and must always be kept separate. ", "106. In so far as the liability in regard to the claims arising from the accidents caused by the use of a motor vehicle is concerned, it arises, in my opinion, from the statutory provisions of the Act. This view, based upon a true construction of the relevant provisions of the Act, is also supported by the recent judicial trends in the field of law of Torts in England. ", "107. The English Law of Torts is not a codified law. It is what may be called a judicial law making. History of English Law of Torts shows the dynamic understanding of the Judges and their inclination to create new forms or categories to meet new situations. The controversy between on one hand and on the other, is academic. Whether one or the other is correct is an Issue that need not be gone into. Suffice it to notice that according to Dr. (On Torts, 5th Edn. at page 3): ", "\"It is the function and purpose of the law of torts that are of greater import, and these are matters which can be explained in comparatively simple terms. The law of torts is concerned with those situations where the conduct of one party causes or threatens harm to the interests of other parties. It is accordingly the aim of the law of torts to adjust, once it is decided that some adjustment is to be made, those losses which must inevitably result from the ever-increasing activities of those who live in a common society. This adjustment is made by providing compensation for the harm suffered by those whose interests have been invaded owing to the conduct of others.\" ", "108. Thus the fundamental objective is to provide compensation for the harm' suffered by those whose interests have been prejudiced and breached. This objective is in a large measure fulfilled by the laws of Scotland. In Scots Law this branch of law is known as reparation. It looks at the matter from the point of view of the victim. When the measure of damages is considered, the amount awarded is normally based solely on the extent of plaintiffs loss and the degree of defendants' fault is not taken into account (see : Legal Values in Western Society; page 126). In England also the principles of volenti and of contributory negligence have been very much diluted as can be seen from 'rescue cases' (see and Jolowics on Tort 9th Edn, pages 635-637). ", "109. An articulate exposition of these approaches is found in the dicta of M.R.. in v. , reported in (1972) 1 All ER page 462. It was a case of negligence. But it was novel in the sense that for the first time a claim was sought to be made against a district council or its surveyor for approval of plans of a building, which collapsed and resulted in an injury to the claimant. At page 475 observed , M. R.: ", "\"This case is entirely novel. Never before has a claim been made against a council or its surveyor for negligence in passing a house. The case itself can be brought within the words of Lord in v. , (1932 AC 562); but it is a question whether we should apply them here. ., (1970-2 All ER 294) Lord said that the words of Lord expressed a principle which ought to apply in general unless there is some justification or valid explanation for its exclusion. So did Lord . But Lord spoke differently. He said that it was a guide but not a principle of universal application. It seems to me that it is a question of some policy which we, as Judges, have to decide. The time has come when in cases of new import, we should decide them according to the reason of the thing.\" (underlining mine). ", "110. It was this 'reason of the thing' which was held by Lord R.. to be the basis of the liability. This is very clear from the following observations found at page 475: ", "\"In short, we look at the relationship of the parties; and then . say as a matter of policy, on whom the loss should fall. What are the considerations of policy here? I will take them in order. First Mrs. has suffered a grievous loss. The house fell down without any fault of hers. She is in no position herself to bear the loss. Who ought in justice to bear it? I should think those who were responsible. Who are they ? In the first place the builder was responsible. It was he who had laid the foundations so badly that the house fell down. In the second place, the 's inspector was responsible. It was his job to examine the foundations to see if they would take the load of the house. He failed to do it properly. In the third place, the council should answer for his failure. They were entrusted by with the task of seeing that houses were properly built. They received public funds for the purpose. The very object was to protect purchasers and occupiers of houses. Yet, they failed to protect them. Their shoulders are broad enough to bear the loss.\" ", "111. Another decision of , M. R., is more apposite to the facts of the present case. Nettleship v. , reported in (1971) 3 All ER 581. This was a case which related to an accident where a learner driver and a passenger who was teaching driving were involved. At page 586, , M. R. observed that: ", "\"The high standard thus imposed by the Judges is, I believe, largely the result of the policy of the Road Traffic Acts. requires every driver to be insured against third-party risks. The reason is so that a person injured by a motor car should not he left to bear the logs on his own, but should be compensated out of the insurance fund The fund is better able to bear it than he can. But the injured person is only able to recover if the driver is liable in law. So the Judges see to it that he is liable, unless he can prove care and skill of a high standard. See the Merchant Prince, ( (1892) P 179) and v. , (1969-3 All ER 756). Thus we are in this branch of the law moving away from the concept. 'No liability without fault'. We are beginning to apply the test; On whom should the risk fall ?' Morally the learner driver is not at fault; but legally she is liable to be because she is insured and the risk should fall on her\". (Emphasis by me). ", "112. Thus upon the authority of an eminent English Judge it is seen that Courts give effect not only to policy of law but also create new forms of law to meet justice in a given situation. In the 's case (1971-3 All ER 581) Lord rested his judgment not merely on the policy of the Road Traffic Act but also on the principle that 'the Lady being insured and the insurance having covered the said risk,' the liability ought to be determined upon the said footing. Thus the policy of law and the fact of the insurance converged to provide the legal basis for compensation in respect of the accident arising out of the use of the motor vehicle on a public road. ", "113. In my opinion, if that is the, position of the English law, where the principles of Torts of negligence are admittedly applicable, stronger becomes the case where detailed provisions are made by an Act of a competent . The Act makes detail provisions enumerating duties of a driver of a motor vehicle. It makes elaborate provisions for an insurance coverage. It makes departure in several respects from the law of Torts and other laws. It provides for a cheap and expeditious remedy by tribunals constituted to hear motor accident claims. It must be held to be the policy of the Act that tribunals must award 'just compensation' for death or bodily injury or damages to property. This salutory jurisdiction and the content of its glorious power cannot be denunded by inhibiting factors obtaining in other fields of substantive law. There is no warrant for undermining the said provisions or policies enshrined therein. ", "114. In these circumstances I concur in the view taken by my learned brother that upon a true construction of the provisions of Chapter VIII the fact of an injury resulting from an accident involving the use of a car on a public road is the basis of the liability. It determines the liability. In connection with the. said liability, the tribunal has to award a 'just compensation' that is the compensation which appears to it 'just' in the facts and circumstances of the case. In such a case the cause of action is breach of statutory obligations imposed by the Act and the damage that has been caused to the injured. 'The quantification of damages' as observed by Lord 'is not an essential part of the cause of action': v. , (1935) 1 KB 75 at p. 83 (supra). This however, would not mean that the principles of law of Torts or the principles enshrined in the provisions of Fatal Accidents Act , are wholly irrelevant. These principles as indeed all other relevant legal principles impinging on the facts of a given case, will enter the judicial mind in the matter of determination of the extent of compensation in cases arising out of accidents. In other words, they along with other relevant principles would be factors which will have to be borne in mind by the tribunal while deciding the extent of liability in cases of accidents involving bodily injury, death or' damages to property. This is a conclusion that follows from the interpretation of the provisions of the Act seen in its historical and humanistic perspective. P. C. ", "115. In view of our above judgment, we pass the following orders. ", "(1) First Appeal No. 449 of 1975 is dismissed with costs. ", "(2) The award passed by the is confirmed but the appellant-insurance Company is given liberty to apply on depositing Rs. 20,000/- with interest RS ordered in the award from the date of the application to the date of the deposit, for not issuing a certificate, against under Section 110-E for the balance of the amount awarded on the ground that the liability of is limited to Rs. 20,000/-under Section 95 (2) or the amount for which has issued the policy, whichever is higher. ", "(3) The tribunal to decide the question of the liability of the insurance company on its application for the said purpose under Section 110-E after giving an opportunity to all the parties. ", "(4) The Insurance Company to pay the costs of all the parties hitherto incurred and hereafter to be incurred. ", "(5) Dr. or his Advocate is at liberty to withdraw Rupees 20,000/- with interest if any when deposited by as stated above. ", "(6) What is stated above shall not in any manner prejudice the right of Dr. to recover the balance of the award amount from the other party or from subject to what is stated above. ", "116. Ordered accordingly."], "relevant_candidates": ["0000251519", "0000540215", "0000666472", "0000817233", "0000859960", "0001162169", "0001281733", "0001346451", "0001388037", "0001571162", "0001596095", "0001728925", "0001731463", "0001937010", "0001991214", "0134378296", "0146239523"]} {"id": "0001722031", "text": ["JUDGMENT , J. ", "1. This is a reference under section 256(1) of the Income-tax Act, 1961, made at the instance of the assessee. The question referred to us for our determination in the reference is as follows : ", "\"Whether, on the facts and in the circumstances of the case, in computing the income of the assessee, the sum of Rs. 4,400 was rightly added ?\" ", "2. The relevant facts lie within a narrow compass. The relevant assessment year is 1962-63, for which the relevant previous year is the accounting year March 25, 1961, to March 31, 1962. The assessee is a registered firm doing business mainly in cloth. The assessee secured a licence for importing automobile spare parts. The assessee then entered into a contract to import and sell to 3,100 capacitors at a profit of 50 per cent. on C. I. F. value. There was a further condition in the contract that the purchaser was to bear all the expenses, including customs duty, etc. Pursuant to this agreement, the assessee placed an order for capacitors with a foreign exporter and the goods, namely, capacitors, were eventually imported. But it was found that the goods did not conform to some of the specifications in the licence and the customs authorities confiscated the goods but gave an option to the assessee to pay a penalty of Rs. 4,400 and clear the goods. The assessee exercised that option and cleared the goods by paying the penalty. The assessee debited the amount of the penalty to the trading account. In valuing the closing stock, the penalty was included. It was in the next year that the sale of the goods to took place. The penalty was paid in the accounting year relevant to the assessment year. The Income-tax Officer concerned disallowed the claim of the assessee for deduction of the amount of penalty and added back the amount of penalty. The Income-tax Officer found, on verification, that the penalty as such had not been recovered by the assessee from but the amount of penalty, it appears, was taken into account in determining the price at which the said goods were sold to . On an appeal by the assessee to the Appellate Assistant Commissioner, he held that the penalty was levied on the appellant and the mere fact that the appellant had billed the vendee in such a manner that the penalty was recovered from the vendee did not change the character of a disallowable item into an allowable one. The Appellate Assistant Commissioner further pointed out that the bill sent to did not specifically mention the basis on which it was prepared. The Appellate Assistant Commissioner agreed with the view of the Income-tax Officer that the assessee's claim in respect of penalty was not one which could be allowed under section 28 of the Income-tax Act, 1961. The assessee then preferred a second appeal to . The came to the conclusion that the assessee had contravened some of the conditions or specifications of the licence and the penalty was levied upon the assessee and not the purchaser. The assessee had rightly debited the penalty to the trading account and the assessee was not right in contending that the debit in respect of the penalty in the trading account was wrongfully made by the assessee. What the purchasers, , had paid to the assessee was not the penalty but the sale price of the goods purchased by them which had been fixed by taking into account the amount of penalty. In view of these findings, the agreed with the conclusion of the Appellate Assistant Commissioner that the amount of penalty could not be allowed as a deduction and upheld the order passed by the Income-tax Officer. The question set out above has been referred to us from the decision of the . ", "3. The submission of Mrs. , learned counsel for the assessee, is that in this case, on the facts found, the assessee must be regarded as a mere nominal licence-holder and the penalty was really levied on to whom the goods had been sold as aforesaid. It was argued by her that, in these circumstances, the assessee should be allowed to claim the amount of penalty paid by the assessee as a deduction in the computation of profits under section 28 of the Income-tax Act, 1961. She placed strong reliance on the decision of a Division Bench of this court in . 67 ITR 667. We shall deal with this case after setting out our own views. In the present case, the facts found by the clearly show that it was the assessee who had got the import licence. It was the assessee who imported the goods in question, and it was the fault of the assessee if the goods in question imported did not conform to the specifications of the licence. In these circumstances, there is no escaping the conclusion that the penalty was levied on the assessee for the default of the assessee itself and not on the ground of any other person's default. Nor is this a case in which the assessee can be regarded in any sense as a nominal licence-holder. It is not as if the assessee gave its licence to for importing the goods in question and imported the goods. The licence was utilised by the assessee-firm itself and that fact cannot be altered by the circumstance that they had agreed to sell the goods to be imported by them to . It is well settled that if an assessee has to pay a penalty to the customs authorities in respect of goods imported by the assessee on account of its own default, the amount of that penalty cannot be deducted in the computation of taxable profits of the assessee. ", "4. Coming to the case of Pannalal Narottamdas & Co. [1968] 67 ITR 667 (Bom) cited by Mrs. , the facts in that case were altogether different. In that case, in the course of its business, the assessee had purchased bills of lading and other shipping documents from certain parties in respect of some consignments of goods imported by them from a foreign country. When the goods arrived in India and were sought to be cleared through the customs by the assessee on the basis of the documents purchased by it, it was found that the imports were unauthorised and the goods were liable to be confiscated and a penalty was liable to be imposed under section 167(8) of the Sea Customs Act, 1878. The assessee paid the penalty for saving the goods from being confiscated. The took the view that the assessee was entitled to plead that it had purchased the documents of title in good faith and had paid consideration thereon, and, thereafter, it had to pay the penalties in order not to lose the goods which had become its property and, in these circumstances, the penalty could be legitimately regarded as part of the cost of the goods. It was held by that, on the facts and circumstances, the actual cost of the goods to the assessee was not only what it had paid to the importers but in addition thereto what it had to pay by way of penalty in order to save the goods from being confiscated and lost to it. It is significant that the observations of set out at page 672 of the aforesaid report show that clearly took the view that in cases where penalty had to be incurred because of the fault of the assessee himself, as for instance, by reason of his having carried on his business in an unlawful manner or in contravention of certain rules and regulations, the penalty paid by the assessee for such conduct thereof could not be regarded as wholly laid out for the purpose of the business, and, in support of this conclusion, the decision of in v. CIT [196l] 41 ITR 350, was cited. This decision, in our view, does not advance the argument of Mrs. , and, in fact, the aforesaid observations pointed out by us lend considerable support to the view which we have taken. ", "5. The question referred to us is, therefore, answered in the affirmative and in favour of the . ", "6. The assessee to pay the costs of this reference to the Commissioner."], "relevant_candidates": ["0001910861"]} {"id": "0001726925", "text": [", J.M. ", "The short but interesting question arising out of this appeal is whether the following amounts of income can be said to have been derived from the industrial undertaking for the purpose of claiming deduction under section 80-I : ", "Rs. ", "Rs. ", "Rs. ", "(i) ", "(i) Sale of import licenses Sale of import licenses 3,93,740 3,93,740 ", "(ii) ", "(ii) Sales-tax refund Sales-tax refund 8,28,010 8,28,010 ", "(iii) ", "(iii) Claims from Insurance & Transport Claims from Insurance & Transport 7,79,642 7,79,642 ", "(iv) ", "(iv) Duty drawback Duty drawback 1,02,301 1,02,301 ", "(v) ", "(v) Difference in exchange Difference in exchange 7,73,407 7,73,407 ", "(vi) ", "(vi) CCS CCS 2,88,740 2,88,740 ", "(vii) ", "(vii) Amount received against IPRS Amount received against IPRS 6,29,369 6,29,369 ", "2. The aforesaid amounts were included by the assessed in the profits of the industrial undertaking for claiming the deduction under section 80-I for assessment year 1992-93. However, the assessing officer was of the view that the words \"derived from\" used by the legislature in section 80-I has restricted meaning as compared to the expression \"attributable to\". Reliance was placed by him on the decision of in the case of (1978) 113 ITR 84 (SC). Applying this legal position he was of the view that the aforesaid amounts of income could not be said to be income derived from the industrial undertaking. Accordingly the claim of the assessed to that extent was disallowed. ", "2. The aforesaid amounts were included by the assessed in the profits of the industrial undertaking for claiming the deduction under section 80-I for assessment year 1992-93. However, the assessing officer was of the view that the words \"derived from\" used by the legislature in section 80-I has restricted meaning as compared to the expression \"attributable to\". Reliance was placed by him on the decision of in the case of (1978) 113 ITR 84 (SC). Applying this legal position he was of the view that the aforesaid amounts of income could not be said to be income derived from the industrial undertaking. Accordingly the claim of the assessed to that extent was disallowed. ", "3. The matter was carried before the Commissioner (Appeals), who has allowed the claim of the assessed after following the decisions of Madras High Court in the case of (1981) 128 ITR 571 (Mad) and in the case of . (1987) 167 ITR 917 (Mad). Aggrieved by the same, the revenue is in appeal before the . ", "3. The matter was carried before the Commissioner (Appeals), who has allowed the claim of the assessed after following the decisions of Madras High Court in the case of (1981) 128 ITR 571 (Mad) and in the case of . (1987) 167 ITR 917 (Mad). Aggrieved by the same, the revenue is in appeal before the . ", "4. The learned Departmental Representative on behalf of the revenue has vehemently assailed the order of the Commissioner (Appeals) by contending that the meaning of the words \"derived from\" has to be understood in the restricted sense as held by in the case of (supra). According to him, there must be a direct nexus between the income and the industrial undertaking. Proceeding further it was submitted that if the source of the income is something else than the industrial undertaking, then such income cannot be said to have derived from industrial undertaking. In this connection, he relied on the latest decision of in the case of (1999) 237 ITR 579 (SC), wherein it has been held that income from the sale of import entitlements could not be treated as income derived from industrial undertaking since source of such income was the scheme itself and not the industrial undertaking. Accordingly, it was argued by him that in the present case there was no direct nexus between the income and the industrial undertaking and, therefore, assessing officer was justified in excluding such income from the income of industrial undertaking for the purpose of computing deduction under section 80-I. ", "4. The learned Departmental Representative on behalf of the revenue has vehemently assailed the order of the Commissioner (Appeals) by contending that the meaning of the words \"derived from\" has to be understood in the restricted sense as held by in the case of (supra). According to him, there must be a direct nexus between the income and the industrial undertaking. Proceeding further it was submitted that if the source of the income is something else than the industrial undertaking, then such income cannot be said to have derived from industrial undertaking. In this connection, he relied on the latest decision of in the case of (1999) 237 ITR 579 (SC), wherein it has been held that income from the sale of import entitlements could not be treated as income derived from industrial undertaking since source of such income was the scheme itself and not the industrial undertaking. Accordingly, it was argued by him that in the present case there was no direct nexus between the income and the industrial undertaking and, therefore, assessing officer was justified in excluding such income from the income of industrial undertaking for the purpose of computing deduction under section 80-I. ", "5. On the other hand the learned counsel for the assessed submitted before us that the word \"from\" has been used to single out the industrial undertaking from non-industrial undertaking and, therefore, if there is any connection between the income and the industrial undertaking then deduction under section 80-I must be allowed. He also tried to distinguish the decision of in the case of (supra) by submitting that in that case merely a right had accrued to the assessed under the scheme which had no value in itself. If the said entitlement was not sold then no income would accrue to the assessed. Hence there was no direct connection with the activity of industrial undertaking in that case but in the present case the items disputed have direct connection with the activity of the manufacturing and sale of manufactured goods. Proceeding further it was submitted by him that if any expenditure goes to the trading, manufacturing or profit and loss account of the assessed in any year and deduction is allowed for the same in computing the income of the industrial undertaking then reimbursement of such expenses would have direct connection with industrial undertaking and accordingly such income cannot be excluded while computing the profits derived from industrial undertaking. Consequently, it was argued by him that sales-tax refund, duty drawback as well as claim for insurance and transport must be held to be income derived from industrial undertaking. Proceeding further he drew our attention to the various schemes i e., cash subsidy scheme and International Price Reimbursement Scheme and argued that these are the trading receipts in view of the decision of the in the case of (1997) 226 ITR 253 (SC) having originated from the industrial activity of export of the goods manufactured by assessed. According to him, the profits do not accrue on mere manufacturing but accrue on sale thereof. Therefore, if on the basis of such sales any incentive is received then it must be held to have derived from industrial undertaking. Proceeding further, it was submitted that the difference in exchange was also directly related to the activity of the industrial undertaking. At this stage, a query was raised from the as to whether foreign exchange was utilised for operational activity of the assessed or for acquisition of capital asset. The learned counsel for the assessed was not able to answer this factual aspect and, therefore, submitted that if the think fit than the matter may be restored for verification to the assessing officer. Regarding the income from sale of import entitlement he had nothing to say in view of the decision of the in the case of (supra). ", "5. On the other hand the learned counsel for the assessed submitted before us that the word \"from\" has been used to single out the industrial undertaking from non-industrial undertaking and, therefore, if there is any connection between the income and the industrial undertaking then deduction under section 80-I must be allowed. He also tried to distinguish the decision of in the case of (supra) by submitting that in that case merely a right had accrued to the assessed under the scheme which had no value in itself. If the said entitlement was not sold then no income would accrue to the assessed. Hence there was no direct connection with the activity of industrial undertaking in that case but in the present case the items disputed have direct connection with the activity of the manufacturing and sale of manufactured goods. Proceeding further it was submitted by him that if any expenditure goes to the trading, manufacturing or profit and loss account of the assessed in any year and deduction is allowed for the same in computing the income of the industrial undertaking then reimbursement of such expenses would have direct connection with industrial undertaking and accordingly such income cannot be excluded while computing the profits derived from industrial undertaking. Consequently, it was argued by him that sales-tax refund, duty drawback as well as claim for insurance and transport must be held to be income derived from industrial undertaking. Proceeding further he drew our attention to the various schemes i e., cash subsidy scheme and International Price Reimbursement Scheme and argued that these are the trading receipts in view of the decision of the in the case of (1997) 226 ITR 253 (SC) having originated from the industrial activity of export of the goods manufactured by assessed. According to him, the profits do not accrue on mere manufacturing but accrue on sale thereof. Therefore, if on the basis of such sales any incentive is received then it must be held to have derived from industrial undertaking. Proceeding further, it was submitted that the difference in exchange was also directly related to the activity of the industrial undertaking. At this stage, a query was raised from the as to whether foreign exchange was utilised for operational activity of the assessed or for acquisition of capital asset. The learned counsel for the assessed was not able to answer this factual aspect and, therefore, submitted that if the think fit than the matter may be restored for verification to the assessing officer. Regarding the income from sale of import entitlement he had nothing to say in view of the decision of the in the case of (supra). ", "6. Rival contentions of the parties as well as the case law referred to by them have been considered carefully. The controversy before us centers around the interpretation of the words 'derived from' used by legislature in section 80-I. This issue came up for consideration for the first time before in the case of (1948) 16 ITR 325 (PC). The question before the court was whether the interest of arrears of rent payable in respect of land used for agricultural purposes could be treated as agricultural income. The meaning of the words \"derived from\" was also considered by in the case of (1955) 27 ITR 1 (SC). In that case A was shareholder of various tea companies whose 60 per cent income was exempt from tax as agricultural income. The assessed also claimed 60 per cent of the dividend income as exempt from tax being agricultural income. The court was concerned with the interpretation of the words \"revenue derived from land\". It was held that the income must have direct association or relation with the land so that it may fall within the scope of the words \"revenue derived from land\". Dividend income was out of investment of funds in shares and, therefore, the same could not be treated as agricultural income. Again in the case of (supra), has held that the expression \"attributable to\" is wider in import than the expression \"derived from\". It was further held that whenever the legislature intended to give restricted meaning it has used the expression \"derived from\". The latest decision of on this issue is in the case of (supra) wherein it has been held that there must be direct nexus between the income and the activity of the industrial undertaking. The question before the court was whether the income from the sale of import entitlements could be said to have derived from the industrial undertaking. In this connection, following observations were made by their Lordships: ", "6. Rival contentions of the parties as well as the case law referred to by them have been considered carefully. The controversy before us centers around the interpretation of the words 'derived from' used by legislature in section 80-I. This issue came up for consideration for the first time before in the case of (1948) 16 ITR 325 (PC). The question before the court was whether the interest of arrears of rent payable in respect of land used for agricultural purposes could be treated as agricultural income. The meaning of the words \"derived from\" was also considered by in the case of (1955) 27 ITR 1 (SC). In that case A was shareholder of various tea companies whose 60 per cent income was exempt from tax as agricultural income. The assessed also claimed 60 per cent of the dividend income as exempt from tax being agricultural income. The court was concerned with the interpretation of the words \"revenue derived from land\". It was held that the income must have direct association or relation with the land so that it may fall within the scope of the words \"revenue derived from land\". Dividend income was out of investment of funds in shares and, therefore, the same could not be treated as agricultural income. Again in the case of (supra), has held that the expression \"attributable to\" is wider in import than the expression \"derived from\". It was further held that whenever the legislature intended to give restricted meaning it has used the expression \"derived from\". The latest decision of on this issue is in the case of (supra) wherein it has been held that there must be direct nexus between the income and the activity of the industrial undertaking. The question before the court was whether the income from the sale of import entitlements could be said to have derived from the industrial undertaking. In this connection, following observations were made by their Lordships: ", "\"We do not think that the source of the import entitlements can be said to be the industrial undertaking of the assessed. The source of the import entitlement can, in the circumstances, only be said to be of where under the export entitlements become available. There must be, for the application of the words \"derived from\", a direct nexus between the profits and gains and the industrial undertaking. In the instant case, the nexus is not direct but only incidental. The industrial undertaking exports processed sea food. By reason of such export, applies. there under, the assessed is entitled to import entitlements, which it can sell. The sale consideration there from cannot, in our view, be held to constitute a profit and gain derived from the assessed's industrial undertaking.\" ", "7. In view of the above discussion, it is held that there must be direct nexus between the income and the industrial undertaking meaning thereby, the source of income must be the industrial undertaking. If the source of the income is other than the industrial undertaking than it cannot be said that such income was derived from the industrial undertaking. ", "7. In view of the above discussion, it is held that there must be direct nexus between the income and the industrial undertaking meaning thereby, the source of income must be the industrial undertaking. If the source of the income is other than the industrial undertaking than it cannot be said that such income was derived from the industrial undertaking. ", "8. In view of the above legal position let us examine the items of dispute before us. For the sake of convenience we first take up the item of duty drawback. In order to appreciate the contentions of the parties, we would like to refer the provisions of section 75(1) of Customs Act, 1962 under which duty drawback is allowed. The same is reproduced as below: ", "8. In view of the above legal position let us examine the items of dispute before us. For the sake of convenience we first take up the item of duty drawback. In order to appreciate the contentions of the parties, we would like to refer the provisions of section 75(1) of Customs Act, 1962 under which duty drawback is allowed. The same is reproduced as below: ", "\"75. Drawback on imported materials used in the manufacture of goods which are exported.-(1) Where it appears to that in respect of goods of any class or description manufactured in India being goods which have been entered for export and in respect of which an order permitting the clearance and loading thereof for exportation has been made under section 51 by the proper officer a drawback should be allowed of duties of customs chargeable under this Act on any imported material of a class or description used in the manufacture of such goods, may, by notification in the Official Gazette, direct that drawback shall be allowed in respect of such goods in accordance with, and subject to, the rules made under sub-section (2).\" ", "We are informed that similar provisions are also made in Central Excise Act . Since in the present case duty drawback was received under the Customs Act , we are referring to the provisions of section 75(1) of Customs Act, 1962 only. ", "The perusal of section 75(1) clearly shows that the duty drawback is given by way of incentive to boost the export of goods manufactured in India. If any imported goods on which custom duty has been levied, has been used in the manufacture of any goods of any class or description and such manufacture goods have been exported out of India, the custom duty paid on imported goods is given back to the manufacturer by way of rebate. This duty drawback is given only to manufacturers making export as is apparent from sub-section (2) of section 75 . In other words, it is nothing but reimbursement of duty already paid. Whenever such duty is paid, it directly affects the profits of industrial undertaking in as much as it is debited to Manufacture & Profit and Loss account. Such payment of custom duty increases the cost of manufacturing but when the same is received back as drawback, it nullifies the affect of aforesaid increase in the cost of manufacturing. Therefore, in our opinion, the duty drawback is inextricably linked with the production cost of the goods manufactured by assessed. Accordingly, it is held that duty drawback is the trading receipt of the industrial undertaking having direct nexus with the activity of such industrial undertaking and accordingly, the same forms part of the income derived from such industrial undertaking. The order of Commissioner (Appeals) is, therefore, upheld with reference to this item. ", "9. For the similar reasons we are of the view that assessed is entitled to succeed in respect of claims received from insurance company and transporters. The reasons is obvious. The payment of freight charges to the transporter as well as the premium to the insurance company is directly connected with the activity of the industrial undertaking affecting the profits of the business and consequently, refund thereof has a direct nexus with such business activity. The details furnished before us clearly shows that amount received from transporters was on account of shortage of rubber and tyres transported. Further the claim from insurance company was on account of the damage of stock due to flood. So, in our view, there is direct nexus between the amount received from the transporter/insurance companies and the activity of the industrial undertaking. Accordingly it is held that such receipts form part of the profits derived from industrial undertaking. The order of Commissioner (Appeals) is, therefore, upheld on this aspect of the issue. ", "9. For the similar reasons we are of the view that assessed is entitled to succeed in respect of claims received from insurance company and transporters. The reasons is obvious. The payment of freight charges to the transporter as well as the premium to the insurance company is directly connected with the activity of the industrial undertaking affecting the profits of the business and consequently, refund thereof has a direct nexus with such business activity. The details furnished before us clearly shows that amount received from transporters was on account of shortage of rubber and tyres transported. Further the claim from insurance company was on account of the damage of stock due to flood. So, in our view, there is direct nexus between the amount received from the transporter/insurance companies and the activity of the industrial undertaking. Accordingly it is held that such receipts form part of the profits derived from industrial undertaking. The order of Commissioner (Appeals) is, therefore, upheld on this aspect of the issue. ", "10. As far as income from sale of import entitlement is concerned, the issue is squarely covered against the assessed by the decision of in the case of (supra). Respectfully following the same it is held that the amount received on the sale of import entitlement shall not form part of profits derived from industrial undertaking. ", "10. As far as income from sale of import entitlement is concerned, the issue is squarely covered against the assessed by the decision of in the case of (supra). Respectfully following the same it is held that the amount received on the sale of import entitlement shall not form part of profits derived from industrial undertaking. ", "11. As far as difference in foreign exchange is concerned, it is not clear from the facts of the case whether such foreign exchange was utilised in the field of capital or revenue. Therefore, order of Commissioner (Appeals) is set aside on this issue and the matter is restored to the file of assessing officer who shall ascertain the facts in this regard. He is directed to allow the claim of the assessed if it is found that foreign exchange was utilized in the revenue field. However, if it is found that it was utilised in the capital field then the assessing officer may not include the same in the business profits derived from industrial undertaking. ", "11. As far as difference in foreign exchange is concerned, it is not clear from the facts of the case whether such foreign exchange was utilised in the field of capital or revenue. Therefore, order of Commissioner (Appeals) is set aside on this issue and the matter is restored to the file of assessing officer who shall ascertain the facts in this regard. He is directed to allow the claim of the assessed if it is found that foreign exchange was utilized in the revenue field. However, if it is found that it was utilised in the capital field then the assessing officer may not include the same in the business profits derived from industrial undertaking. ", "12. As far as sales-tax refund is concerned, the relevant provisions of Sales Tax Act under which refund was granted and the relevant facts which led to such refund were neither placed before the lower authorities nor before us. The only submission of the learned counsel for the assessed is that like duty drawback it is also reimbursement of the amount of sales-tax paid by the assessed. According to him, the payment of sales-tax is debited to the P&L account like custom duty or excise duty which affects the cost of production and, therefore, any amount refunded against such payment would be trading receipt and thus it would have a direct nexus with the activity of industrial undertaking. However, we do not find such submissions supported by any material or evidence. Normally sales-tax is paid by the dealer/manufacturer after collecting the same from customers. In such cases question of debiting the sales-tax payment to P&L account simply does not arise. However, if sales-tax collected and paid are transferred to P&L account it would not affect either the profit or loss of such undertaking. However, sometimes, the assessed may challenge the levy of sales-tax itself in writ petition before and subsequently, may get the refund. Such cases have been considered by the courts as cases of unjust enrichment in as much as taxes are paid after collecting the same from the customers. In such cases, the sale-tax refund may constitute business receipts in view of the decision of in the case of (1973) 87 ITR 542 (SC), but the same, in our opinion, cannot be considered as profits derived from industrial undertaking because there is no direct link between the activity of such undertaking and receipt of sales-tax. Further, copy of profit and loss account appearing at page 20 of the paper book does not show that any amount of sales-tax was debited to P&L account. It is also not the case of the learned counsel for the assessed that sales-tax paid on raw material is given back against the export/local sales of the goods manufactured out of such raw material as in the case of duty drawback. Therefore, the sales-tax refund cannot be considered at par with the duty drawback unless it is established that payment of sales-tax enhance the cost of production and same is received back by way of reimbursement. We are not aware of the circumstances under which the refund was granted to the assessed. The law is well-settled that whenever any deduction/relief is claim, the onus lies on the assessed to prove that the conditions for claiming such relief are fulfillled. Reference can be made to the decision of in the case of . (1951) 19 ITR 191 (SC). Since such onus has not been discharged, the claim of the assessed regarding sales-tax refund is rejected. However, it is clarified that in some other appropriate case, the may decide the issue in the light of sales-tax provisions and relevant material /evidence which may be brought before it. The decision of reported as case (supra) and case (supra) relied upon by the learned Commissioner (Appeals) are quite distinguishable inasmuch as the decided the issue in view of the wordings \"attributable to\" which are wider in scope than the words \"derived from\" as held by the in the case of (supra). In view of the above discussion, the order of Commissioner (Appeals) is reversed on this aspect of the issue and the order of assessing officer is restored. Consequently, it is held that the sales-tax refund was rightly excluded from the profits of the industrial undertaking for the purpose of deduction under section 80-I . ", "12. As far as sales-tax refund is concerned, the relevant provisions of Sales Tax Act under which refund was granted and the relevant facts which led to such refund were neither placed before the lower authorities nor before us. The only submission of the learned counsel for the assessed is that like duty drawback it is also reimbursement of the amount of sales-tax paid by the assessed. According to him, the payment of sales-tax is debited to the P&L account like custom duty or excise duty which affects the cost of production and, therefore, any amount refunded against such payment would be trading receipt and thus it would have a direct nexus with the activity of industrial undertaking. However, we do not find such submissions supported by any material or evidence. Normally sales-tax is paid by the dealer/manufacturer after collecting the same from customers. In such cases question of debiting the sales-tax payment to P&L account simply does not arise. However, if sales-tax collected and paid are transferred to P&L account it would not affect either the profit or loss of such undertaking. However, sometimes, the assessed may challenge the levy of sales-tax itself in writ petition before and subsequently, may get the refund. Such cases have been considered by the courts as cases of unjust enrichment in as much as taxes are paid after collecting the same from the customers. In such cases, the sale-tax refund may constitute business receipts in view of the decision of in the case of (1973) 87 ITR 542 (SC), but the same, in our opinion, cannot be considered as profits derived from industrial undertaking because there is no direct link between the activity of such undertaking and receipt of sales-tax. Further, copy of profit and loss account appearing at page 20 of the paper book does not show that any amount of sales-tax was debited to P&L account. It is also not the case of the learned counsel for the assessed that sales-tax paid on raw material is given back against the export/local sales of the goods manufactured out of such raw material as in the case of duty drawback. Therefore, the sales-tax refund cannot be considered at par with the duty drawback unless it is established that payment of sales-tax enhance the cost of production and same is received back by way of reimbursement. We are not aware of the circumstances under which the refund was granted to the assessed. The law is well-settled that whenever any deduction/relief is claim, the onus lies on the assessed to prove that the conditions for claiming such relief are fulfillled. Reference can be made to the decision of in the case of . (1951) 19 ITR 191 (SC). Since such onus has not been discharged, the claim of the assessed regarding sales-tax refund is rejected. However, it is clarified that in some other appropriate case, the may decide the issue in the light of sales-tax provisions and relevant material /evidence which may be brought before it. The decision of reported as case (supra) and case (supra) relied upon by the learned Commissioner (Appeals) are quite distinguishable inasmuch as the decided the issue in view of the wordings \"attributable to\" which are wider in scope than the words \"derived from\" as held by the in the case of (supra). In view of the above discussion, the order of Commissioner (Appeals) is reversed on this aspect of the issue and the order of assessing officer is restored. Consequently, it is held that the sales-tax refund was rightly excluded from the profits of the industrial undertaking for the purpose of deduction under section 80-I . ", "13. As far as cash compensatory support (hereinafter referred to as the CCS) is concerned, we find merit in the appeal of the revenue. The perusal of the scheme raised before us shows that CCS is a kind of subsidy given to a person who export goods either purchased or manufactured by him under a scheme formulated by . Unlike duty drawback it is not reimbursement of any expenditure on input incurred by the assessed. Further for claiming such subsidy, the person need not carry on any industrial undertaking since it is available to any person making export out of India. It is simply an incentive granted to an exporter under a scheme. Therefore, it cannot be said that there is any nexus between the subsidy received and the activity of the industrial undertaking. The source of the subsidy is the scheme framed by the government and not the industrial undertaking. Hence the decision of in the case of (supra) would apply squarely to the present issue. It has been held in that case that receipts on sale of import entitlements had nexus with the scheme of government and not the industrial undertaking and, therefore, deduction under section 80HH could not be allowed. Respectfully following the same, it is held that CCS cannot form part of profits derived from industrial undertaking. The order of Commissioner (Appeals) is, therefore, reversed on this aspect of the issue and order of assessing officer is restored. ", "13. As far as cash compensatory support (hereinafter referred to as the CCS) is concerned, we find merit in the appeal of the revenue. The perusal of the scheme raised before us shows that CCS is a kind of subsidy given to a person who export goods either purchased or manufactured by him under a scheme formulated by . Unlike duty drawback it is not reimbursement of any expenditure on input incurred by the assessed. Further for claiming such subsidy, the person need not carry on any industrial undertaking since it is available to any person making export out of India. It is simply an incentive granted to an exporter under a scheme. Therefore, it cannot be said that there is any nexus between the subsidy received and the activity of the industrial undertaking. The source of the subsidy is the scheme framed by the government and not the industrial undertaking. Hence the decision of in the case of (supra) would apply squarely to the present issue. It has been held in that case that receipts on sale of import entitlements had nexus with the scheme of government and not the industrial undertaking and, therefore, deduction under section 80HH could not be allowed. Respectfully following the same, it is held that CCS cannot form part of profits derived from industrial undertaking. The order of Commissioner (Appeals) is, therefore, reversed on this aspect of the issue and order of assessing officer is restored. ", "14. Now coming to International Price Reimbursement Scheme (IPRs), we find that a scheme was formulated by under which exporters of engineering goods were allowed reimbursement of part of the price paid in the domestic market in respect of certain kinds of iron steel so that such exporters could compete in the international market. Payment of purchase price in respect of raw material certainly affects the profits of an industrial undertaking and, therefore, reimbursement thereof would directly affect such profits. In these circumstances, one can form the view that there is a direct nexus with the activity of the industrial undertaking. However, it has to be borne in mind that such reimbursement would not have been available to the assessed but for the scheme formulated by . Therefore, the immediate source of such receipt has to be traced to such scheme and consequently, the decision of in the case of (supra) would apply, which is binding on us. Hence, the issue is decided in favor of the revenue. The order of Commissioner (Appeals) is, therefore, reversed on this aspect of the issue and the order of assessing officer is restored. ", "14. Now coming to International Price Reimbursement Scheme (IPRs), we find that a scheme was formulated by under which exporters of engineering goods were allowed reimbursement of part of the price paid in the domestic market in respect of certain kinds of iron steel so that such exporters could compete in the international market. Payment of purchase price in respect of raw material certainly affects the profits of an industrial undertaking and, therefore, reimbursement thereof would directly affect such profits. In these circumstances, one can form the view that there is a direct nexus with the activity of the industrial undertaking. However, it has to be borne in mind that such reimbursement would not have been available to the assessed but for the scheme formulated by . Therefore, the immediate source of such receipt has to be traced to such scheme and consequently, the decision of in the case of (supra) would apply, which is binding on us. Hence, the issue is decided in favor of the revenue. The order of Commissioner (Appeals) is, therefore, reversed on this aspect of the issue and the order of assessing officer is restored. ", "15. The next issue relates to the addition of Rs. 1,82,29,686 made by assessing officer on account of valuation of stock which has been deleted by Commissioner (Appeals). ", "15. The next issue relates to the addition of Rs. 1,82,29,686 made by assessing officer on account of valuation of stock which has been deleted by Commissioner (Appeals). ", "16. The assessed was engaged in the manufacture and sale of cycle tyres and tubes as well as trading of fans, sewing machine etc. The assessed had been valuing the closing stock at market price. However, in the year under consideration the assessed changed the method of valuing the closing stock from market value to cost. The assessed was asked to explain as to why such change should not be disallowed. It was explained by the assessed that the method followed in the current year was a recognised method of valuation and the change was bona fide one since it was going to be followed regularly. Certain case laws were relied on by the assessed. After considering the explanation of the assessed, the assessing officer found the change as bona fide one and the same was permitted. Having done so, he went on to observe that it is the duty of the assessing officer to determine the true profit of the year. Reliance was placed on the decision of in the case of . (1991) 188 ITR 441 (SC). He has also referred to the decision of Delhi High Court in the case of (1975) 99 ITR 574 (Del) for the proposition that opening stock cannot be valued in a manner different from the valuation of closing stock. Accordingly, the assessing officer worked out the loss to the revenue due to change in the method of valuation. Considering this fact, he reduced the opening stock by 25 per cent. As a consequence thereof, the net addition of Rs. 1,82,29,686 was made. ", "16. The assessed was engaged in the manufacture and sale of cycle tyres and tubes as well as trading of fans, sewing machine etc. The assessed had been valuing the closing stock at market price. However, in the year under consideration the assessed changed the method of valuing the closing stock from market value to cost. The assessed was asked to explain as to why such change should not be disallowed. It was explained by the assessed that the method followed in the current year was a recognised method of valuation and the change was bona fide one since it was going to be followed regularly. Certain case laws were relied on by the assessed. After considering the explanation of the assessed, the assessing officer found the change as bona fide one and the same was permitted. Having done so, he went on to observe that it is the duty of the assessing officer to determine the true profit of the year. Reliance was placed on the decision of in the case of . (1991) 188 ITR 441 (SC). He has also referred to the decision of Delhi High Court in the case of (1975) 99 ITR 574 (Del) for the proposition that opening stock cannot be valued in a manner different from the valuation of closing stock. Accordingly, the assessing officer worked out the loss to the revenue due to change in the method of valuation. Considering this fact, he reduced the opening stock by 25 per cent. As a consequence thereof, the net addition of Rs. 1,82,29,686 was made. ", "17. The matter was carried before the Commissioner (Appeals) before whom it was contended that in the case of change in the method of valuation, the opening stock cannot be disturbed because the closing stock of the preceding year has to be taken as opening stock of next year as per the settled position of law. In this regard three judgments were relied on, namely, decision of in the case of . (1988) 173 ITR 347 (AP), the decision of Karnataka High Court in the case of . (1988) 174 ITR 616 (Karn) and the decision of in the case of (1993) 202 ITR 789 (Bom). The Commissioner (Appeals) agreed with this contention of the assessed and further strengthened the same by referring to the decision of Hon'ble Supreme Court in the case of (1953) 24 ITR 481 (SC) wherein it has been held that valuation of closing stock must be taken as opening stock in the succeeding year. Following this legal position, the Commissioner (Appeals) deleted the addition made by assessing officer. Aggrieved by the same, the revenue is in appeal before the . ", "17. The matter was carried before the Commissioner (Appeals) before whom it was contended that in the case of change in the method of valuation, the opening stock cannot be disturbed because the closing stock of the preceding year has to be taken as opening stock of next year as per the settled position of law. In this regard three judgments were relied on, namely, decision of in the case of . (1988) 173 ITR 347 (AP), the decision of Karnataka High Court in the case of . (1988) 174 ITR 616 (Karn) and the decision of in the case of (1993) 202 ITR 789 (Bom). The Commissioner (Appeals) agreed with this contention of the assessed and further strengthened the same by referring to the decision of Hon'ble Supreme Court in the case of (1953) 24 ITR 481 (SC) wherein it has been held that valuation of closing stock must be taken as opening stock in the succeeding year. Following this legal position, the Commissioner (Appeals) deleted the addition made by assessing officer. Aggrieved by the same, the revenue is in appeal before the . ", "18. After hearing both the parties, we do not find any merit in the appeal of the revenue. There is no dispute of the fact that the change in the method of valuation of closing stock was bona fide one and the same has been accepted by the assessing officer also. Having accepted the same, the question before the assessing officer was whether he could disturb the value of opening stock. In our opinion, the answer to this question is in the negative. It is settled position of law that value of the closing stock has to be taken as value of the opening stock of the succeeding year. Reference can be made to the judgment of the Honble in the case of (supra). This position has not been disturbed by any decision of till date. The decision of Delhi in the case of (supra) and the decision of in the case of (supra) are distinguishable in as much as in none of the cases, there was change in the method of valuing the stock. Those were the cases where the method of valuing the stock was itself defective and contrary to the recognized principles of valuation. Accordingly, it was held that assessing officer was duty bound to adopt the correct method of valuation and in such process the opening stock as well as closing stock could be correctly valued in the similar manner. But there is no case available where there is a bona fide change in the method of valuation and the courts have allowed to disturb the opening stock which was done according to the recognised principles of valuation. On the contrary, the three decisions relied upon by the learned Commissioner () covers the issue before us. These decisions are in the cases of (supra), (supra) and (supra). Therefore, in our opinion, the Commissioner () was justified in deleting the addition. Consequently, the order of Commissioner () is upheld on this issue. ", "18. After hearing both the parties, we do not find any merit in the appeal of the revenue. There is no dispute of the fact that the change in the method of valuation of closing stock was bona fide one and the same has been accepted by the assessing officer also. Having accepted the same, the question before the assessing officer was whether he could disturb the value of opening stock. In our opinion, the answer to this question is in the negative. It is settled position of law that value of the closing stock has to be taken as value of the opening stock of the succeeding year. Reference can be made to the judgment of the Honble in the case of (supra). This position has not been disturbed by any decision of till date. The decision of Delhi in the case of (supra) and the decision of in the case of (supra) are distinguishable in as much as in none of the cases, there was change in the method of valuing the stock. Those were the cases where the method of valuing the stock was itself defective and contrary to the recognized principles of valuation. Accordingly, it was held that assessing officer was duty bound to adopt the correct method of valuation and in such process the opening stock as well as closing stock could be correctly valued in the similar manner. But there is no case available where there is a bona fide change in the method of valuation and the courts have allowed to disturb the opening stock which was done according to the recognised principles of valuation. On the contrary, the three decisions relied upon by the learned Commissioner () covers the issue before us. These decisions are in the cases of (supra), (supra) and (supra). Therefore, in our opinion, the Commissioner () was justified in deleting the addition. Consequently, the order of Commissioner () is upheld on this issue. ", "19. In the result, appeal of the revenue is partly allowed. ", "19. In the result, appeal of the revenue is partly allowed."], "relevant_candidates": ["0000081055", "0000127231", "0000147488", "0000431954", "0000485657", "0000881663", "0000949611", "0001483559", "0001606698", "0001679719", "0001847433", "0001873699"]} {"id": "0001747159", "text": ["CASE NO.: Special Leave Petition (civil) 15178 of 1999 PETITIONER: WORKERS WELFARE ASSOCIATION & ANR. Vs. RESPONDENT: THE MANAGEMENT OF & OTHERS DATE OF JUDGMENT: 29/01/2002 BENCH: D.P. Mohapatra & P. Venkatarama Reddi JUDGMENT: ", ", J. ", "Leave granted and appeal taken up for hearing. ", "The first appellant which seems to be a representative body of the retired workmen of of and the second appellant who is a member thereof, have assailed the legality of the judgment of in C.W.J.C. No. 5693 of 1995 dated 10.11.1997. By that judgment upheld the award passed by , Patna, in Reference No.3/92, following the earlier decision of reported in 1997 (1) PLJ 934, wherein the identical issues were decided against the workmen. The Writ Petition out of which the appeal arises was filed by the second appellant herein challenging the award passed by on 13.12.1994. ", "The 1st appellant sought leave of this to file the SLP as it was not a party in the Writ Petition out of which this SLP arises. Leave has been granted by us. It may also be noticed that by an order of this dated 31.08.2001 on IA 3 of 2001 the 2nd appellant herein, who was respondent No.3 in SLP, has been transposed as petitioner in the SLP. ", "At the outset, it may be stated that the present SLP was filed with a delay of 460 days. The delay in filing the SLP is sought to be explained in a very casual manner, the only ground stated being \"paucity of funds\" which on the face of it is as vague as it could be. In the normal course, we should have dismissed the for condonation of delay and rejected the SLP summarily. However, as arguments have been advanced at length on the merits and as the grievance of retired employees is being projected, we do not consider it appropriate to dismiss the SLP on the ground of delay. Hence, leave has been granted and appeal decided on merits. ", "The following dispute between Basudevpur, Munger and their workmen represented by which is a recognised union was referred for adjudication by : ", "\"Whether to enforce Platinum Jubilee Scheme Pension Plan for the workers who retired from service on or after 24.8.1986 and to enforce other pension scheme for the workers retired before the 24.8.1986 and to give two types of benefits to both types of workers by the Management of I.T.C. ", "Ltd., is legal and justified? If not, whether the workers who retired before 24.8.1986 from I.T.C. Ltd. are also entitled for the benefits under Platinum Jubilee Pension Plan?\" ", "The learned Presiding Officer answered the reference in favour of the Management and against the Union, having held that the workmen who retired before 24.8.1986 were not entitled to the benefits under . By that scheme, the workmen who retired on or after the date afore-mentioned were made eligible to get life pension. It was the contention of the workers'-Union before the and it is also the contention of the appellants that the benefits should be extended to all those workmen who retired during and after 1977 when the pension scheme was first introduced in this industrial establishment. ", "To have a proper background of the dispute, it is necessary to refer briefly to the pension scheme prevalent prior to the introduction of . A settlement entered into on 27.6.1977 paved the way for the introduction of pension scheme for the first time. It applied to the permanent workmen on the rolls of the company who retired on or after 1.6.1977. Under that scheme, the pension was payable for a period of 10 years. By a subsequent settlement dated 22.4.1982, though the period of drawal of pension remained the same, the formula was revised and the maximum pension payable was enhanced to Rs.225/- per month. This benefit under the settlement dated 22.4.1982 governed the workmen who were on the Company's pay roll on the date of signing of the settlement. On the eve of commemoration of platinum jubilee of , the Management decided to introduce a scheme known as Platinum Jubilee Pension Scheme. Under this scheme, eligible workmen will get the pensionary benefits till their life time and on their demise, part of the benefits go to their nominees or legal heirs. In order to implement the pension scheme, a fund named \"Platinum Jubilee Pension Fund\" was created under a trust deed dated 27.5.1987. As a follow up thereto, scheme Rules were framed in the year 1988. While so, pursuant to discussions and negotiations held in the course of conciliation proceedings, there was a settlement under Section 12(3) of Industrial Disputes Act on 10.4.1988. As it was agreed that should be made part of the service conditions of employees, the following provisions were incorporated in the settlement dated 10.4.1988 :- ", "\"PENSION SCHEME In supersession of clause 14 Part I read with Annexure VII of Memorandum of Settlement dated 28.4.82, the following Pension Scheme shall apply :- ", "(i) The company has by a Deed of Trust dated 27.5.87 setup a Trust Fund entitled for payment of pension to its workmen. With effect from the date of signing of this Memorandum of Settlement, all workmen on the rolls of the company as at 24th August, 1986 and thereafter will be eligible to become members of the aforesaid and will be eligible to receive benefits in accordance with the aforesaid Trust Deed and rules. A copy of the said Trust Deed and Rules is attached herewith as Annexure XII. ", "(ii) With effect from 1.4.88, the ITC Workmen's Pension Fund Scheme as contained in clause 14, Part I and Annexure VII of the Memorandum of Settlement dated 28.4.82 will cease to be applicable to workmen on the rolls of the company as at 24.8.86 and thereafter. It is expressly agreed and understood that such workmen will be governed only by the ITC Platinum Jubilee Pension Fund Deed and Rules. ", "(iii) It is clarified that workmen who were on the rolls of the company prior to 24.8.86 and who are in receipt of pension under the workmen's Pension Scheme as contained in clause 14, Part I and Annexure VII of the Settlement dated 28.4.82 will continue to be governed by the rules of the Workmen's Pension Scheme. The Platinum Jubilee Pension Fund Deed and Rules will not be applicable to them.\" ", "Under the Trust Deed dated 27.5.1987, constituted the ITC Platinum Jubilee Pension Fund to be administered by the trustees who are required to hold the fund in trust for the benefit of the members or other persons set forth in the Rules. The Fund shall be vested in the trustees who shall have the entire control of the funds. The Deed enjoins that no money belonging to the members in the hands of the trustees shall be recovered by the nor shall the have any lien or charge on the same. The trustees are required to arrange for the investment of the funds and payment of pension due to the members in accordance with the Rules. Clause 6 stipulates that the funds of the Trust shall consist of accumulations from the contributions received by the trustees in accordance with the Rules, securities or other investments, interest and other accretion arising out of the funds as reduced by payments and disbursements. The Trust Deed also provides for possible contingencies. ", "Let us now advert to ITC Platinum Jubilee Pension Fund Rules. As already noticed, the fund shall be deemed to have come into operation on or from 24.8.1986 notwithstanding the date of the Trust Deed. Under the caption 'Membership', it is provided by Rule 8(a) that all confirmed and regular workmen of the as defined in Rule 2(h) shall be eligible for membership of the fund. An employee who is eligible for the membership of the fund may make an application in the prescribed form and furnish the particulars of the nominees in another form to the trustees through the . The , on scrutiny of such application, has to forward the same to the trustees with whose approval the employee shall be admitted as a member. Under the heading 'Contribution', it is provided that the may pay to the trustees in respect of the members an initial contribution as may be certified by the Actuary subject to Rule 88 of the Income Tax Rules. Under clause (b) of Rule 9, it is enjoined that the shall pay to the trustee in respect of each member an ordinary annual contribution as may be certified by the Actuary subject to I.T. Rules 87 and 88. Under clause 11(b), the pension admissible as per the Rules shall be payable through out the life time of the member and shall be computed at the rate of 1/180 part of the pensionable salary for each year of pensionable service. The maximum pension payable shall be Rs.400/- per month and the minimum shall be Rs.100/- per month. Provisions for payment of pension to the widow for her life time in the event of demise of the member and for the payment of pension for a period of 10 years to his nominee if the member is unmarried or widower are also made. ", "Thus the salient features of are that a separate fund is created for the purpose of payment of pension and the same is vested and controlled by the trustees; the eligible person should become member of the fund on an application submitted by him, the pension is payable during the life time of the member and in the event of demise of the member (retired workman), the pension at a stipulated rate is payable to the widow or to a beneficiary nominated by member in case of an unmarried or widower person. The ceiling limit has been raised to Rs.400/- per month. Thus, is undoubtedly much more beneficial to the retired workmen. At this juncture, we may notice that there has been a controversy on the question whether the pension scheme introduced in 1988 is in substance a new scheme or it is a revised or liberalized scheme. But, it is unnecessary to resolve that issue. ", "The learned counsel for the appellants has reiterated the contentions advanced before and in the connected matter. While accepting that Article 14 as such has no application because is not a 'State' or 'other ', the counsel, however, urged that on the analogy of Article 14 , the relevant clauses in the settlement are to be held to be arbitrary, unjust and irrational, that the prescription of cut-off date i.e. 24.8.1986 which has the effect of denying greater benefits under the scheme to the workmen who retired before that date is equally arbitrary, discriminatory and unjust and therefore the settlement entered into on 10.4.1988 cannot defeat the legitimate rights of the workmen who retired before 24.8.1986. It is further submitted that all the workmen drawing pension under the Company's Rules settlements belong to one class and there cannot be sub-classification amongst them by treating the workmen who retired between 24.8.1986 and 10.4.1988 as a different class. It is argued that when the benefit is given to the workmen who retired within the two dates afore-mentioned, the same benefit ought to have been extended at least to those who retired after the date of the settlement of 1982 i.e. 28.4.1982. It is then contended that the date 24.8.1986 has been fixed arbitrarily and the Management's contention that it coincided with the date of completion of 75 years of Company's existence is factually incorrect, in as much as 75 years would expire by 24.8.1985, the Company having been incorporated on 24.8.1910. It is also submitted that notwithstanding the settlement which according to the appellant's counsel is unjust and discriminatory, all the workmen retiring after 24th April, 1982, are entitled to the benefit of . ", "The learned Senior counsel for the respondent-Company while drawing support from the reasoning and conclusions of in the case reported in 1997 1 PLJR 934, has laid considerable stress on the fact that the employees of the Company existing or retired cannot invoke Article 14 and they as well as the Management and other workmen are only governed by the provisions of the Industrial Disputes Act . The settlement which was entered into under Section 12(3) as a result of conciliation proceeding was binding on all the workmen and no workman much less any individual workman or group of workmen can challenge the same, especially after the recognised which espoused the cause of workmen and participated in the proceedings before the , chose to accept the award. The learned senior counsel pointed out that the second petitioner is also a member of the recognised and it is not open to him to assail the settlement or the award. He was not even the person who filed the Writ Petition in . The present SLP filed after the delay of 460 days is liable to be dismissed in limine on the ground of unsatisfactory explanation for the delay. On the facts of the case highlighted by the , there is no basis to hold that settlement is ex facie, unjust or arbitrary. Giving the benefit to the employees who retired about two years prior to the date of settlement does not invalidate the settlement on any ground known to law, but on the other hand, it is the concession shown by the Management on the occasion of celebrating Platinum Jubilee. It is further submitted that one clause in the settlement cannot be legitimately assailed and the settlement has to be viewed as a whole. When the settlement as a whole, has not been attacked as unfair or mala fide, it is not open to the much less to the individual workmen who are not parties to assail one clause in the settlement dealing with the pension. It is submitted that an overall view has to be taken when the question of validity of settlement is put in issue. ", "Before proceeding further, we shall advert to the findings of . At the outset, the overruled the contention of the that the reference was without jurisdiction for the reason that the retired employees on whose behalf the dispute was raised are not workmen. The learned Presiding Officer of the then observed that all the issues including the one relating to life time pension with effect from the particular date were discussed threadbare by the office-bearers of the Union, , the representatives and the Joint Labour Commissioner and then the settlement was arrived at. The cut-off date i.e. 24.8.1986 was not picked up arbitrarily. It was the date on which the Company completed 75 years of its existence. The after having referred to the various pronouncements of this Court then observed that the cut-off date was introduced after due deliberations and no material has been placed by the Union to show that the fixation of cut-off date was arbitrary or mala fide. Earlier the clarified that the letter addressed by the Conciliation Officer-cum-Labour Commissioner subsequent to the settlement cannot be considered to be a binding direction but it was only an appeal to the to take a compassionate view in the matter of extending benefits to other retired persons. ", "As already noticed, the learned single Judge affirmed the award of and dismissed the Writ Petition filed by the 1st Petitioner herein following the earlier judgment reported in (1997 1 PLJR 934). To complete the narration, it is necessary to refer to the views expressed by the in that case. The learned Judges concentrated on the issue whether the fixation of cut-off date was irrational and arbitrary, and answered the question in the negative. In reaching such conclusion, inter alia took into account the fact that the scheme emanating from the settlement dated 10.4.1988 was entirely a new scheme and therefore, the ratio of the decision in Nakara's case has no application. \"The present case is not one of liberalization of the existing pension scheme, but one of the introduction of a new scheme\", observed. Treating the Platinum Jubilee day as the cut-off date was held to be not an arbitrary decision. ", "In answering the reference the industrial adjudicator has to keep in the forefront of his mind the settlement reached under Section 12(3) of the Industrial Disputes Act. Once it is found that the terms of the settlement operate in respect of the dispute raised before it, it is not open to to ignore the settlement or even belittle its effect by applying its mind independent of the settlement unless the settlement is found to be contrary to the mandatory provisions of the Act or unless it is found that there is non-conformance to the norms by which the settlement could be subjected to limited judicial scrutiny. This is infact the approach of the in the instant case. which examined the issue from a different angle as well was, in our view, justified in affirming the award of the . ", "As the settlement entered into in the course of conciliation proceedings assumes crucial importance in the present case, it is necessary for us to recapitulate the fairly well settled legal position and principles concerning the binding effect of the settlement and the grounds on which the settlement is vulnerable to attack in an industrial adjudication. Analysing the relative scope of various clauses of Section 18 , this in the case of . (1991 (1) SCC 4) succinctly summarized the position thus:- ", "\"Settlements are divided into two categories, namely, (i) those arrived at outside the conciliation proceedings ( Section 18(i) and (ii) those arrived at in the course of conciliation proceedings ( Section 18(3) ). A settlement which belongs to the first category has limited application in that it merely binds the parties to the agreement. But a settlement arrived at in the course of conciliation proceedings with a recognised majority union has extended application as it will be binding on all workmen of the establishment, even those who belong to the minority union which had objected to the same. To that extent it departs from the ordinary law of contract. The object obviously is to uphold the sanctity of settlements reached with the active assistance of the Conciliation officer and to discourage an individual employee or a minority union from scuttling the settlement. There is an underlying assumption that a settlement reached with the help of the conciliation Officer must be fair and reasonable and can, therefore, safely be made binding not only on the workmen belonging to the union signing the settlement but also on the others. That is why a settlement arrived at in the course of conciliation proceedings is put on par with an award made by an adjudicatory authority.\" ", " (AIR 1986 SC 954), E.S. Venkataramiah, J. Speaking for the Court explained the rationale behind Section 18(3) thus :- ", "\"Even though a Conciliation Officer is not competent to adjudicate upon the disputes between the management and its workmen he is expected to assist them to arrive at a fair and just settlement. He has to play the role of an adviser and friend of both the parties and should see that neither party takes undue advantage of the situation. Any settlement arrived at should be a just and fair one. It is on account of this special feature of the settlement sub-sec. (3) of S.18 of the Industrial Disputes Act, 1947 provides that a settlement arrived at in the course of conciliation proceeding under that Act shall be binding on (i) all parties to the industrial dispute, (ii) where a party referred to in clause (i) is an employer, his heirs, successors, or assigns in respect of the establishment to which the dispute relates and (iii) where a party referred to in clause (i) is comprised of workmen, all persons who were employed in the establishment or part of the establishment as the case may be to which the dispute relates on the date of the dispute and all persons who subsequently become employed in that establishment or part. Law thus attaches importance and sanctity to settlement arrived at in the course of a conciliation proceeding since it carries a presumption that it is just and fair and makes it binding on all the parties as well as the other workmen in the establishment or the part of it to which it relates as stated above.\" ", "Admittedly, the settlement arrived at in the instant case was in the course of conciliation proceedings and therefore it carries a presumption that it is just and fair. It becomes binding on all the parties to the dispute as well as the other workmen in the establishment to which the dispute relates and all other persons who may be subsequently employed in that establishment. An individual employee cannot seek to wriggle out of the settlement merely because it does not suit him. ", "The next principle to be borne in mind is that in a case where the validity of the settlement is assailed, the limited scope of enquiry would be, whether the settlement arrived at in accordance with sub-section (1) to (3) of S.12, is on the whole just and fair and reached bonafide. An unjust, unfair or malafide settlement militates against the spirit and basic postulate of the agreement reached as a result of conciliation and, therefore, such settlement will not be given effect to while deciding an industrial dispute. Of course, the issue has to be examined keeping in view the presumption that is attached to the settlement under Section 12(3) . ", " (1976 (4) SCC ", "736), this Court called for a finding on the point whether the settlement was fair and just and it is in the light of the findings of the that the appeal was disposed of. , J. speaking for the three-Judge Bench made it clear that the settlement cannot be judged on the touch stone of the principles which are relevant for adjudication of an industrial dispute. It was observed that the fell into an error in invoking the principles that should govern the adjudication of a dispute regarding dearness allowance in judging whether the settlement was just and fair. The rationale of this principle was explained thus:- ", "\"There may be several factors that may influence parties to come to a settlement as a phased endeavour in the course of collective bargaining. Once cordiality is established between the employer and labour in arriving at a settlement which operates well for the period that is in force, there is always a likelihood of further advances in the shape of improved emoluments by voluntary settlement avoiding friction and unhealthy litigation. This is the quintessence of settlement which courts and tribunals should endeavour to encourage. It is in that spirit the settlement has to be judged and not by the yardstick adopted in scrutinizing an award in adjudication.\" ", "The line of enquiry whether settlement was unfair and unjust in Vs. Presiding Officer and others (1996 (10) SCC 446), was adopted by a three-Judge Bench of this Court speaking through , J. It was observed at paragraph 21 that \"under these circumstances, respondents 3 to 14 also would be ordinarily bound by this settlement entered into by their representative unless it is shown that the said settlement was ex facie, unfair, unjust or mala fide\". The Court came to the conclusion that the settlement cannot be characterised to be unfair or unjust. It was further observed that \"once this conclusion is reached it is obvious that another industrial dispute should have been disposed of in the light of this settlement\". It was reiterated in the case of Vs. Their Workmen (AIR 1981 SC 2163), that \"a settlement cannot be weighed in any golden scales and the question whether it is just and fair has to be answered on the basis of principles different from those which come into play when an industrial dispute is under adjudication\". Earlier, it was observed :- ", "\"If the settlement had been arrived at by a vast majority of the concerned workers with their eyes open and was also accepted by them in its totality, it must be presumed to be just and fair and not liable to be ignored while deciding the reference merely because a small number of workers (in this case 71, i.e., 11.18 per cent) were not parties to it or refused to accept it, or because the was of the opinion that the workers deserved marginally higher emoluments than they themselves thought they did.\" ", "Another principle which deserves notice is the one firmly laid down in case (supra). It was emphasised that the settlement has to be taken as a package deal and it should not be scanned 'in bits and pieces' to hold some parts good and acceptable and others bad. Then, it was observed \"unless it can be demonstrated that the objectionable portion is such that it completely outweighs all the other advantages gained, the Court will be slow to hold a settlement as unfair and unjust. The settlement has to be accepted or rejected as a whole and we are unable to reject it as a whole as unfair or unjust.\" ", "Having noted that the only objectionable feature of the settlement as found by the was reduction of dearness allowance from cent per cent to 85 per cent, it was held that, that part of the settlement cannot be held to be invalid or inoperative. This proposition laid down in case was reiterated in case (supra), approvingly citing the said decision. The passages in case were quoted in extenso and approved by the three-Judge Bench in case (supra) as well. ", "What follows from a conspectus of these decisions is that a settlement which is a product of collective bargaining is entitled to due weight and consideration, more so when a settlement is arrived at in the course of conciliation proceeding. The settlement can only be ignored in exceptional circumstances viz. if it is demonstrably unjust, unfair or the result of mala fides such as corrupt motives on the part of those who were instrumental in effecting the settlement. That apart, the settlement has to be judged as a whole, taking an overall view. The various terms and clauses of settlement cannot be examined in piecemeal and in vacuum. ", "Viewed in the light of these principles, it cannot be said that the settlement in the present case which is otherwise valid and just suffers from any legal infirmity merely for the reason that one of the clauses in the settlement extends the benefits of life pension scheme only to the employees retiring after a particular date i.e. 24.8.1986. Exclusion of workmen retiring before that date is no ground to characterise the settlement as unjust or unfair. Of course, the allegations of mala fides such as corrupt motives have not been levelled against anyone and that aspect becomes irrelevant here. ", " proceeded to consider whether even that particular clause in the settlement dealing with the pension is per se arbitrary or discriminatory and reached a conclusion that it is not so for the reason that a new scheme for pension has been introduced by the impugned settlement and that the question of arbitrariness in fixing the cut-off date does not therefore arise. further held that the fixation of cut-off date for the purpose of entitlement of life pension cannot be said to be arbitrary or irrational as such fixation becomes imperative from financial point of view and moreover the date coincided with the Platinum Jubilee Celebrations of the Company. The date was not 'picked up from the hat', observed. approached the issue more from the angle of Article 14 and referred to the decisions in which the State's action in making the classification for the purpose of extending the pensionary benefits or additional benefits fell for consideration of this Court. Strictly speaking, such approach is not apt and appropriate. The present case is one where Article 14 cannot be applied as the respondent is not 'State' or 'other Authority'. On this, there is practically no dispute. If so, the approach should be as we indicated earlier; that is to say, whether the settlement can be said to be unjust, unfair or vitiated by mala fides. No mala fides is imputed to anyone. What remains to be considered is whether it is fair and just, viewed from a broader angle and taking a holistic view of the matter. It is true that certain considerations germane to Article 14 may also be germane while deciding the issue whether the settlement is just and fair. But, it does not follow that the doctrine of classification and the principles associated with it should be projected wholesale into the process of consideration of justness and fairness of the settlement. There may be some overlapping and there may be some facets which apply in common to determine the crucial issue whether the settlement on the whole is just and fair, but that is not to say that the settlement is liable to be tested on the touchstone of Article 14 , more so when it has no application in the instant case. Keeping this distinction in mind and considering the grounds of attack on the particular clause of settlement, we are unable to hold that it is vulnerable to challenge on any well- recognised grounds. The facts on record do not establish that the settlement which was reached was palpably unjust or unfair from the point of view of the entire body of workmen. The preponderence of circumstances and the material on record do not in our view, displace the presumption attached to the settlement arrived at in the course of conciliation. ", "Firstly, it is to be borne in mind that there was no challenge at any time to any of the terms of the settlement other than the clause relating to pension in so far as it confines the benefit of life-long pension only to those who retire on or after 24.08.1986. Secondly, we must give due weight to the fact that the settlement was reached as a result of collective bargaining and with the assistance of officer. Invariably, there would be an element of give and take in the deal leading to the settlement. Granting the benefit of life-long pension prospectively or with limited retro-active effect does not make the settlement unjust or unfair. It is certainly beneficial to the workmen in service and those who retired few months earlier. The mere fact that the did not go the whole hog to extend the benefit to all the retired employees does not impart an element of unjustness or unreasonableness to the settlement. Financial implications apart, the benefits granted to workmen under various other clauses of settlement have to be kept in view. This particular clause relating to pension cannot be considered in isolation. The learned senior counsel for the petitioners argued that there was no justification in making a sub-classification amongst the retired employees by giving the benefit to those who retired only between 24.08.1986 and the date of settlement. In our view, conferment of such additional benefit to workmen who retired after the date of platinum jubilee celebration and before the date of culmination of settlement, far from making it unjust or irrational, tantamounts to extending benefit to some more workmen who would not have got it otherwise, if the decision was implemented prospectively. Apparently, such decision was taken to arrive at an amicable settlement and to comply with the demands of the workmen to the extent feasible and practicable. The argument that either all the retired employees should be given the benefit or none at all cannot cut ice if the principles of collective bargaining and justness of the settlement viewed as a whole is kept in view. There is nothing which is palpably unjust or irrational in giving the benefit only to those who retired during and after the platinum jubilee year. Though there was some dispute as to the correctness of the date on which the platinum jubilee falls, no material has been placed before us excepting the date of incorporation of the to establish the version of the appellants in this regard. Picking up that date by going a little backwards from the date of settlement cannot be regarded as a whimsical or arbitrary step, more so when it was done with the consent of large majority of workmen. The while adjudicating the dispute and while exercising its jurisdiction under Art. 226 /227 should be circumspect and cautious in disturbing the terms of settlement founded on collective bargaining and conciliation. The adjudicator of industrial dispute could not have directed the benefit to be extended to all the retired employees by substituting its own views to those reflected in the settlement, on an application of the usual principles governing industrial adjudication. ", "Another factor to be taken into account is that the recognised union of workmen which espoused the cause of the retired employees and contested the issue before did not pursue the matter further obviously because they felt that in the larger interests of maintaining industrial harmony and peace, the matter should be left off at that stage. A member of that recognised union had taken up the issue before . ", "Considering all these factors, we find no legal infirmity in the award of the which has been affirmed by and we say so without going into the subtle question whether the scheme is a new one for all practical purposes or only a revision or liberalization of the pre-existing pensionary benefits. ", "In the view we have taken it is not necessary to dwell on the contention raised by the learned senior counsel for the respondent regarding the maintainability of the writ petition and SLP at the instance of the appellants. ", "We see no merit in the appeal and it is hereby dismissed. No costs. ", " ", "() .J. ", "() January 29, 2002. ", "1 ", "1 ", "1"], "relevant_candidates": ["0001134562", "0001170587", "0001394570"]} {"id": "0001776507", "text": ["JUDGMENT , J. ", "1. This appeal raises a jurisdictional question of some significance. Since answer to the jurisdictional question is to take shape in thelight of facts asserted in the plaint ofr the claim petition, it would, therefore, be appropriate first to notice the relevant facts. ", "2. The claimant happened to be driving Car No. CH 8851. While crossing Gate No. 121 on Panchkula-Zirakpur road, which was open at that time, railway train suddenly approached the said manned railway crossing, engine whereof said to be without lights, struck against his car as a result whereof the claimant recived injuries and his car was damaged; that there wa sno red light to stop the traffic on the road and the accident resulted due to the carelessness and negligence of the driver, the guard in question and the gateman. Since the respondent, which inter alia, included , General Manager, , New Delhi, Station Master, Chandigarh besides the driver, guard of the train and the gateman questioned the jurisdiction of the tribunal to try the matter so the tribunal formulated a preliminary issue to the effect as to whether the application lies before . The answered the question against the claimants and in favour of the respondents and dismissed the claim petition. ", "3.The appeal in the first instance came up for hearing before . J. who referred the appeal to the larger . The appea was then put up before a Division which in turn referred the same to a larger and that is how this appeal is before us. ", "4. In all civil matters, it is which has the jurisdiction to go into the claims of the kind unless its jurisdiction is either expressly or by necessary implication stands barred. claims for compensation arising out of accidents by use of motor vehicles, till the amendment of the Motor Vehicles Act (hereinafter referred to as the Act), which added Ss. 110 to 110F to the said Act, were tried by . The being aware of the increasing number of the accidents involving motor vehicles and the resultant misery to the persons involved in the accident or their dependents and the immediate need for financial succour provided a special forum (speedy and inexpensive) in the form of for adjudicating upon the claims for compensation in respect of accidents involving the death of, or bodily injury to persons arising out of the use of motor vehicles, or damages to any property of a third party so arising or both and it also sought to bar the expensive and tardy jurisdiction of by enacting S. 110F of the Act, which reads as under:-- ", "\"110F Bar of Jurisdiction of Civil Courts. Where has been constituted for any area, no Civil Court shall relating to any claim for compensation which may be adjudicated upon bgy for that area, and no injunction in respect of any action taken or to be taken by or before in respect of the claim for compensation shall be granted by \". ", "5. The determination of the parameter of the jurisdiction of the Tribounal envisaged under S. 110 of the Act would depend upon the construction of the experession 'compensation in respect of accidents... arising out of the use of motor vehicles occurring in S. 110 of the Act. The aforesaid expression indicates that there should be an accident which should be as a result of the use o9f motor vehicles. Besides the aforesaid spelled out limiting words the aforesaid expression envisagtes no other limitations, that is, once it is held that there has been an accident as a result of the use of motor vehicle in which either a person has died or has received imjuries or there has been damage to any property of a third party, the would have the jurisdiction to the person or authority against whom the claim is made, may be any. ", "6. Some High Courts however have sought to spell out limitation upon the jurisdiction of the from the provisions of S. 110B or by giving a restrictive interpretation to the word use occurring in S. 110 . ", "7. A Division Bench of Gauhati High Court in Swarnalata v. , AIR 1974 Guhati 31 took the view that from thescheme of newly added group of provisions starting from s. 110 to S. 110F , it would be clear that the had got no jurisdiction to enforce authority except the owner, the driver and the insurer of the motor vehicle involved in the accident as would be evident from the provisions of S. 110B . ", "8. In v. , AIR 1975 Andh Pra 222, one of the contentions raised before the Division Bench was that had no jurisdiction to adjudicate upon the claim for compensation arising out of the accident between the truck and the train view of the provisions of S. 100F , Motor Vehicles Act , and it was claimed that alone had the jurisdiction to adjudicate upon the given claim. The above contention was repelled with the following observations:-- ", "\"It is true that the jurisdiction of under S. 110 is stated to be to adjudicate up[on claims in respect of accidents involving the death of or bodily injury to, persons arising out of the use of motor vehicles............ But if we have regard to the scheme of the Act and the context in which S. 110 appears, it is cloear that the claim referred to in the section can have reference only to claims only against the owner or the driver of the motor vehicle concenred in the accident. It could not have been the intention of the framers of the Act to include claim against other persons as well. The Motor Vehicles Act is an Act to consolidate and amend the law relating to motor vehicles. This section occurs in the chapter dealing with insurance of motor vehicles against third party risks. The object behind this section is to provide for speedy and effective machinery for persons injured in accidents arising out of the use of motor vehicles against the owners and the drivers and insurers of motor vehicles. To accept the contention of the learned counsel for the respondent that it would include claims against all persons would lead, in our view, to consequences which were never contemplated by the framers of the Motor Vehicles Act . For instance, a person proceedings in a motor vehicle may be injured by an accident resulting from the fall of tree of the collapse of building. It cannot be said that the occupants can lay a claim in the constituted under the Motor Vehicles Act against the owners of the building or of the tree, if it was due to the negligence of such owner that such accident occurred. Similarly \"in this case we do not think the provisions of the Motor Vehicles Act were intended to enable the parties injured or the owner of the lorry to make a claim against the railway, simply because the accident arose out of the use of motor vehicle. In our view, the claims referred to in S. 110 are appliable only to cases of claims against the owner or the driver of the motor vehicle or the insurer as the case may be and not as against strangers. The proper forum for adjudicating the claim against the strangers is . The jurisdiction of the Civil mCo is not, in our view, barred by S. 110F of the Act\". ", "9. A single Judge of in , 1982 ACJ 99: (AIR 1982 Him Pra 11), while considering the contention of the claimant that he be awarded compensation against as it had failed to maintain the road because it was the sagging of the road that had led to the accident held that the respondent-State of Himachal Pradesh although being, the owner of the road and responsible for its maintenance might be liable in fort for such a claim but on a consideration of the scheme of the Act and the context in which S. 110 appears, the jurisdiction of appointed under S. 110 of the Act, is restricted to entertaining claims and giving awards only against the insurers, owners and drivers of the vehicles involved in the accidents and not against any other persons and a close scrutiny of the provisions of Ss. 110 to 110B appears to lend ample support to that view. ", "10. The learned single Judge of in , 1982 ACJ 374: (AIR 1982 Del 282) too had to deal with a like contention. In the case before him, scooter had fallen in a pit on the road as result whereof the claimant was injured. He sought compensation before whose duty it was to maintain the roads. The learned Judge held that in view of the provisions of S. 110B , the remedy of the owner, if any against the respondents lay before and not before the . The learned Judge approvingly quoted the view taken by in Swaranalata's case (AIR 1974 Gauhati 31)(supra) and case (AIR 1975 Andh Pra 222)(supra). ", "11. in , AIR 1982 All 310 however, took a different view of the matter. The question that arose for consideration of in case (supra0 was as to whether had the jurisdiction to entertain a claim against the railway. The facts of the case were that various claimants were travelling by a Tempo-Taxi, which collided with the Allahabad-Saharanpur passenger at Sarai Gopal Railway crossing. As a result, the claimants sustained bodily injuries. The claimants filed claim petitions before the against both the owner of the tempo-taxi as well as the applicant namely represented by the General Manager, . In the claim petiton it was alleged that the accident had occurred due to the negligence of the employees of the railway staff at the aforesaid railway crossing. The employees had wrongly kept the level crossing wide open for the highway traffic to apss at a time when the aforesaid train happened to be passing through that point. ", "12. It was asserted on behalf of that the claim against the railway was only triable before . , J. who delivered the opinion for the Bench held that had the jurisdiction to adjudicate upon the claims for compensation agtainst the railway in the case in hand and that the provisions of S. 110B of the Act did not limit the jurisdiction of the to the awarding of compensation against persons other than those mentioned in the said section. The following observations of , J. ion this regard can be noticed with advantage:-- ", "\"11. Then there is S. 110B on which the applicant mainly relies. It reads thus:-- ", "\"110B. Award of --On receipt of an application for compensation made under S. 110A , shall, after giving the parties an opportunity of being heard, hold an enquiry into the claim and may make any award determining the amount of compensation which ppears to it to be just and specifying the person or persons to whom compensation shall be paid; and in making the award shall specify the amount which shall be paid by the insturer or owner or driver of the vehfile involved in the accident or by all or any of them as the case may be\". ", "12. We are clearly of the opinion, upon an provisions and the scheme of the enactment as projected by these provisions, that constituted under the Act is empowered to adjudicate upon all claims for eompensation in respect of accident involving the death or the bodily injury to persons, where the accident arises out of the use of a motor vehicle and, that in awarding compensation in respect of such an accident is empowered to award compensation not only against the insurer and the owner and the driver of the motor vehicle but also against those on account of whose negligence the accident may have been caused. The words \"in respect of accidents............... arising out of the use of the motor vehicle............\" occurring in S. 110(1) are words of the widest possible amplitude. We see no reason either on the plain language of S. 110 or in any other allied provisions ofr the scheme of the Act as manifested by the relevant provisions, which may have inhibited or barred the jurisdiction of to entertain an application for compensation in respect of third parties, in the present case, the . ", "13. As mentioned above, the Motor Vehciles Act is a comprehensive Code. have been constituted, in our opinion, to entertain all claims in respect of accidents arising out of the use of motor vehicle. It cannot be disputed that where the death or bodily injoury is caused to the claimant in an accident arising out of the use of motor vehicle and as a result of the negligence of the owner or the driver of the motor vehicle as well as of a third party, the claim so far as the owner or insurer or the driver of the motor vehicle are concerned would lie before under the Act in terms of S. 110 . The civil Court will indisputably have nojurisdiction to entertain the claim against the insurer or owner or driver in view of the express bar imposed by S. 110F . ", "14. If, therefore, were to accept the submission of the applicant it must follow as a necessary corollary that in regard to the same accident as against the third party, the claim would lie elsewhere, namely, the civil . In theat event it would not be difficult to see that two conflicting decisions are likely to come into existence. The may hold the driver of the motor vehicle wholly at fault and responsible for the accident and on that ground award compensation against the owner of the motor vehicle or the driver or the insurer. The Civil. may, on the other hand seized of the case againt the third party in respect of same accident, may come to an exactly opposite conclusion and hold some one else responsible for the accident and bodily injuries to the claimant. ", "15. Such a result cannot have been intended by the legislature. On the plain language of S. 110 , therefore, we have no hesitation in coming to the concludion that the claims in question were maintainable against the . In our opinion a complete adjudication of all the claims for compensation in respect of an accident arising out of the use of the motor vehicle was intended to be provided for under the Act and consequently unless all the parties involved in the accident are arrayed as opposite parties before the same forum and are heard on the question of negligence, the matter cannot be property and effectively disposed of. For, otherwise, if the claimant is compelled to institute his claim before the only against the owner and drived of the vehicle and insurer and is left to sue the remaining persons responsible for the accident the adjudication cannot be said to be complete and final. ", "Under the Circumstances, the only reasonable interpretation which has appealed to us it that suggested by the learned counsel for the claimants, namely, that the claims were maintanable against the also. ", "16. We may now turn to S,. 100B to see whether there is anything therein whichmight be construed as restricting them ambit of S. 110 . The first part of S. 110B has been expressed in general terms. It provides that shall after giving the parties an opportunityof being heard hold an enquiry into the claim and may make an award determining the amount of compensation which appears to it to be just and specify the person or persons to whom compensation shall be paid. In the first part, which is the substantive part, there is no indication that cannot award any compensation against persons other than the insurer or the owner or thedrive fot he motor vehicle. Stress was, however, made on the second part of S. 110B which provides that in maing the award shall specify the amount which shall be paid by the insurer or the owner or the driver of the vehicle in question. It was submitted that this limits the power of only to these three classes of persons. ", "17. We are unable toaccept the above contention,. \"The second part of s. 110 comes into operation and is attracted only because it is necessary to approtion the liability between the insurer or the owner is accordance with the relevant provisions of the Act specifying the limits of liability of the insurer. It does not in our opinion, in any way curtail or restrict the power of to award compensation against a third party who may be found to have contributed to the accident involving the death or bodily injuries to persons arising out of the use of the motor vehcile. In our opinion, the second part of S. 110B enjoins the to approtion the liability between the insurer and the owner of the vehicle, where the holds the owner or the driver responsible for the injury caused to the claimant\". ", "With respect, I entirely concur in the view that , J. has taken and the reasoning adopted by him and further find myself unable to concur in the view taken by the Gauhati, Andhra Pradesh, Himachal and Delhi min thecases referred to above. ", "13. Section 110A indicates the person or persons who could invoke the jurisdiction of the S. 110B , however, is not enacted by the in my opinion to indicate the persons against whom the compensation could be claimed. The said provision merely envisaged that in the event of a finding that an owner or driver of the vehicle was liable to pay compensation then it could specify the amount which the insurer, if any, and the owner and the driver was to pay. In a given case the insurer of the vehicile may not be liable to pay the entire compensation amount which had been found to be payable as a result of the negligence of the driver of the vehicle and so a has to additionally specify as to what amount the driver has to pay. Also in a given case, an award can be made only against the driver and the insurance company See 1967 Accomadation C J. 312 (Punj). In such a case the limit of the liability of the driver and the insurer too may have to be fiexed by the , if the Statute had fixed the outside limit of theliability of the insurer. ", "14. I see no reason as to why cannot award compensation against the owner of the tree if the accident resulted from th falling of the tree or against the owner of the building if the accident resulted from the falling of the building on the car and from the owner of the road if the accident resulted as a result of non-maintenance of the road in proper condition, if the allegation in the petition is that the accident occurred as a result of the negligence of the owner of the tree or the owner of the building or the owner of the road or the persaon whose liability it was to maintain the road in proper condition. ", "15. In the case in hand, it cannot be denied that the accident arose out of the use of the motor vehicle i.e., the accident arose as a result of the use of the motor vehicle. ", "16. In the case in hand, the had the jurisdiction to identify the fault of the parties in question. In case it finds that the staff of the was at fault and the acccident had occurred as a result of their negligence, then the is entitled to award compensation to the claimants gainst the respondents. if, on the other hand, it holds that the accident had occurred as a result of the negligence of the driver of the motor amount that is payable in terms of S. 110B of the Act. ", "17. For the reasons aforementioned, I hold that if it is alleged that claim for compensation arose in respect of an accident arising out of the use of motor vehicle, then would have the jurisdiction to adjudicate upon t eh claim and award compensation against the party whom it finds to be responsible for the accident and further specify the amount of compensation in terms of s. 110B , if the said provision is found to be attracted to the facts of the given case. ", "18. In the result, I set aside the order and finding given by the and remit the case to the to proceed with the matter in accordance with law and the observations made in this judgment. No costs. ", ", J. ", "19. This claim petition under Motor Vehicles Act filed by the appellant for the grant of compensation for personal injuries and the damage caused to his car was dismissed by the on a preliminary objection that it has no jurisdiction to entertain and try the same. Aggrived thereby he has come up in this appeal. The matter came up for hearing in the first instance before a learned single judge who referred it to . further referred it to in view of the conflict of view between the decisions of various . ", "20. The claimant along with on June 23, 1979 was returning from Panchkula to Chandigarh in Car No. CH 8851 driven by him at about 1. 30 a. m. When he was crossing Gate No. 121 on Panchkula-Zirakpur Road a railway train struck against his car. It was alleged that the engine was without lights, the crossing gate was lying open and there was no red light to stope traffic on either side of the gate. It was pleaded that the accident was caused entirely due to the carelessness and negligence of the authorities including the driver of the train and the gateman. ", "21. The claim was contested by the respondent who raised a preliminary objection that had no jurisdiction to entertain and try the claim against them which was sustained and the petition dismissed. ", "22. The claims arising out of motor accidents being causes of civil nature used to be instituted and tried by . the Legisdlature in view of ever increasing accidents caused by indisciplined and fast moving traffic enacted Motor Vehicles Act (No. 100 of 1956) to ameliorate the suffereings of injured and dependent claimants of the deceased and to provide cheaper and speedier remedy to them. By virtue of the provisions of S. 110 . Motor Vehicles, Act, substituted by the Amendment Act in place of the original section, the State Government were empowered to constitute one or more Motor Accident Claims Tribunals for purposes of adjudicating upon clims for compensation in respect of accidents involving death or bodily injury to persons arising out of the use of motor vehicles or damages to the property of third party or both. It was further provided by s. 110F that where has been constituted for any area, no civil Court shall have jurisdiction to entertain any question relating to any claim for compensation which may be adjudicated upon by for that area. ", "23. The precise point raised and canvassed befoer the was that uness the alleged accident had occurred out of the use of a motor vehicle which necessarily means its negligent driving, the claim would not lie with the and instead would be entertainable by the civil Court alone. so, it was contended that the would have no jurisdiction to entertain the claim where the allegationn is that the accident took place because of thenegligence of any other authority in the maintenance of the the road or any other such like cause. The contention prevailed with most of the High Courts till a discordant note was struck by in , AIR 1982 All 310. ", "24. For the first time, this matter came up before a Division Bench of in ., AIR 1974 Gauhati 31, though in an indirect way. The accident in that case had taken place between tje nis amd tje Railway trian on a Railway crossing. The claim was filed against the owner of the bus and alleging that the accident had taken place because of the negligence of the driver of the bus. One of the pleas raised in the defence was that the accident took place not due to the negligent driving of the bus, but because of the negligence on the part of the Railway authorities in leaving the gate at the level crossing unmanned. An objection ancillary to this plea made was that eh Railway authority was a necessary party and in its absenceo the claim petition could not be tried. After noticing the provisions of s. 110B and S. 110F , the Bench overruled the objection in the following terms:-- ", "\"From the scheme of this group of sections it will be clear that the claims tribunals have compensation for death of or injury to persons arising out of use of motor vehicles. The has got no jurisdiction to enforce any such claim against any other person or authority except the owner, the driver and the insurer of the motor vehicle involved in the accident, as will be evident from the provisions of S. 110B . The being the legal position, there was no scope for the petitioners to implead in these proceedings before the Claims . If they have been able to prove that the accident arose out of any negligence of rashness in the use of the motor vehicle, they will succeed, otherwise they will fail. In this view of the case I hold that the claim petitioners are not bad for non-joinder of \". ", "Though there is no detailed discussion or reasoning for the view expressed, but apparently the learned Judges relied on the provisions of s. 110B to hold that the under the act has no jurisdiction to enforce a claim against any other person or authorty except the owner, the driver and the insurer of the motor vehicle involved in the accident. ", "25. In Commissioner. , AIR 1975 Andh Pra 222, a collison took place between a goods train and a lorry on accoungt of which the owner of the lorry and had to deposit certain amounts under the Workmen's Compensation Act for the deaths of some labourers and the injuries to theothers. Later on, the owner and the Insurance company filed a suit for the recovery of those amounts from alleging that the accident had taken place because of the negligence of the employees of the . At the appellate stage, an objection was raised that the claim having arisen out of the use of a motor vehicle was triable only by the and not by , and the Division Bench overruled the same observing thus:-- ", "\"It is tue that the jurisdiction of under S. 110 is stated to be to adjudicate upon claims in respect of accidents involving the death of or bodily injury to persons arising out of the use of motor vehicles. It is therefore submitted that it would include a clim against any person provide that the accident arose out of the use of a motor vehiclause But if we have regard to the scheme of the Act and the context in whichS. 110 appears, it is clear that the claim referred to in the section can have reference only to claims against the owner or the driver of themotor vehicle concerned in the accident. It could not have been the intention of the framers of the Act to include claim against other persons as well. The Motor Vehicles Act is an Act to consolidate and amend the law relating to motor vehicles. This section occurs in the chapter dealing with insurance of motor vehicles against third party risks. The object behind this section is to provide for a speedy and effective machinery for persons injured in accidents arising out of the use of the motor vehicles against the owners and drivers and insurers of motor vehicles. To accept the contention of the learned counsel for the respondent that it would include claims against all persons would lead., in our view, the consequences which were never contemplated by the framers of the Motor Vehicles Act . For instance, a person proceeding in a motor vehicle may be injured by an accident resulting from the fall of a tree or the collapse of a building. It cannot bessaid that the occupants can lay a clim in the constituted under the Motor Vehicles Act against the owners of thebuilding or of the tree. if it was due to the negligence of such owner that such accident occurred. Similarly in this case, we do not think the provisions of the Motor Vehicles Act were intended to enable the parties injured or the owner of the lorry to make a claim against the railway, simply because the accident arose out of the use of a motor vehicle. In our view, the claims referred to in S. 110 are applicable only to cases of claims against theowner or the driver of the motor vehicle or the insurer as the case may be and not as against strangers. The proper forum for adjudicating the claim against the strangers is a civil Court. The jurisdiction of is not in our view barred by S. 110F of the Act\". ", "26. , 1982 Accomadation CJ 99: (AIR 1982 Him Pra 11), a truck belonging to fell down into a deep khud near Ganasidhar resulting in the death of the driver and the owner of the goods. The claim petition filed before the was dismissed on the finding that the accident had happened on account of giving way of false projection of the road which was supported on wooden logs and not due to the negligence of the truck driver. In the appeal before an alternate plea was raised that even if the accident be taken to have occurred on account of sagging of the road, the would be liable in tort to pay the compensation being owner of the road. The plea was turned down holding that the has no jurisdiction to entertain any claim against the as owner of the road for the following reasons:-- ", "\" Section 110 empowers the State government to appoint for the purpose of adjudicating upon claims for compensation in espect of accidents involving the death of or bodily injury to, persons arising out of the use of motor vehicles, or damages to any property of a third party so arising, or both and to define the local limits of their jurisdiction. S. 110A enumerates the persons who are competent to apply for grant of such compensation to such Triunals. This section further provides that an application for compensation of the type mentioned above shall be made in such form and shall contain such particulars as may be prescirbed,. It also provides for the period of limitation within which an application for compensation can be made before the and further empowers the to condone the delay if sufficient cause is shown. s. 110B which is imporrtant from the point of view for the issue in hand, requires the to hear the parties, hold an enquiry into the claim and to make its award determining the amount of compensation which appears to it to be just. After the makes is award so determining the amount of compensation, it is further required to specify the person or persons rto whom the compensation shall be paid\" ", "27. , 1982 Acc CJ 374: (AIR 1982 Delhi 282), the claimant alleging that while he was going on his scooter on the ring road at about 10 p. m. the front wheel of the scooter fell in a pit on the road and overturned resulting in grievous injuries to him, filed a claim petition against , Delhi, to recover Rs. 25,000/- by way of compensation. It was held that the Tribunal has no jurisdiction to entertain the claim on the grounds that if the opposite party had no connection with the vehicle involved in the accident, he cannot be made liable under the Act; and that hte jurisdiction of to award compensation is restricted against driver, owner or the insurer of the vehicle involved in the accident as mentioned in s. 110B of the Act. ", "28. As noticed above, of in case (AIR 1982 All 310) (supra) for the first tribunal is empowered to award compensation not only against the insurer, the owner and the driver of the motor vehicle, but also against the on the following ratio:-- ", "\" constituted under the Act is empowered to adjudicate upon all claims for compensation in respect of accident involving the death or the bodily injury to persons, were where the accident arises out of the use of a motor vehicle and, in awarding compensation in respect of such an accident is empowered to awared compensation not only against the insurer and the owner and the driver of the motor vehicle but also against those on account of whose negligence the accident may have been caused. The words \"in respect of accidents....... arising out of the use of the motor vehicle.... occurring in S. 110(1) are words of the widest possible amplitude. There is no reason eithr on the plain language of S. 110 or in any other allied provisions or the schme of the Act as manifested by the relevant provisions, whichmayhave inhibited or barred the jurisdiction of to entertain an application for compensation in respect of third parties in the present case, the . ", "The second part of S. 110B which provides that in maing the award shall specify the amount which shall be paid. by the insurer or the owner or the driver of the vehicle in question does not in any way curtail por restict the power of to award compensation against a third party who may be found to have contributed to the accident. Where the driver or the owner of the motor vehicle is found to have been negligent and the injuries are found to have been caused as a result of that negligence, the liability has necessarily to be apportioned between the insurer and the owner in view of the provisions of the Act. It was to give effect to this statutory requirement that the second part of S. 110B enjoins the to apportion the liability between the insurer and the owner of the vehicle, where holds the owner or the driver responsible for the injury caused to the claiment. s. 110B, thus, does not curtail the width or amplitude of S. 110 which is the source of power of under the Act. ", "Moreover, a complete adjudication of all the claims for compensation in respect of an accident arising out of the use of motor vehicle was intended to be provided for under the Act and consequentloy unless all the parties involved in the accident are arrayed as opposite parties before the same forum and are hear on the question of negligence, the matter cannot be properly and effectivly disposed of. For, otherwise, if the claimant is compelled to institute his cloaim before the only against the owner anhjd driver of the vehicle and insurer and is left to sue the remaining person responsible for the accident, the adjudicaion cannot be said tobe complete and final\". ", "29. Relying on the above observations in case, (AIR 1982 All 310)(supra), my learned brother , has opined that a clim for compensation would be trible by the so long as the death or the injuries are stated to have been caused while the deceased or the injured was travelling in a motor vehicle no matter whether the accident took place because of the negligence of the driver of the motor vehicle or any foreign anency. With utmost respect I find it difficult to go so far and, in my view, the claim petition would be entertainable by the under the Act only if the accident is alleged to have taken place because of the negligent dirving of the motor vehicle, though in the alternative the plea may be that the accident too,k place because of the composite negligence or the negligence of an age4ncy other than in the driver of the motor vehicle./ If primarily the accident is alleged to have taken place because of the negligent driving of the nmotor vehicle, the claim would be maintainable even against the agencies other than the driver, the owner and the insurer of the motor vehicle if compensation is claimed against the them in the alternative or jointly with the former because of composite negligence. ", "30. In all the above nnoted cases in which the view has been taken that a claim petition against the persons other thant he owner, driver and the instuer is not maintainable before the under the Act, reliance has been placed on that part of s. 110B which provides that that in maing the award the Claims shall specify the amount which shall be paid by the insurer or owner or driver of the vehicle involved in the accident or by all or any of thme, as the case may be. This provision, in my view, in no way indicates either that the jurisdiction of the Claims is confined to give award against the insurer, or owner or driver or curtails the jurisdiction conferred on the under the earlier portion of the section which authorises him to determine the amount of compensation to be payable to the claimants or any one of them. The latter portion of this section requires specification of the liablity amongst the insurer or owner or driver because it hbas reloevancy only mongst them. On the question of apportionment, if the liability is found to be composite of the owner, driver or insurer of the vehicle on the one hand and some other party on the other, the question of apportionment between the two set of parties would not arise. Similarly, if the liability to pay compensation is entirely fixed on a party other than the owner, driver or the insureer of the motor vehicle, again the question of apportionment would not airse. It is for this reason that the apportionment clause is confined to the insurer or owner or driver of the vehicle and the other persons are not named in the provision and not because the intention was to limit jourisdiction of the to award compensation against the said three persons only. ", "31. Now, take for example, when accident is proved to have taken place because of the negligence of the driver, th owner may plead that he is not vicariously liable for the negligence because the driver was acting beyond his duties or against his instructions. Similarly, Insurer can take the plea that the driver was an unlicensed driver or that he was using the vehicle for an unauthorised purpose when the accident took place. Also the insurer is entitled to plead that his liability is limited to certain extent according to the insurance policy or the provisions of the statute. In all such cases, the would be called upon to specify as to who was liable and to what extent, to pay the amount of compensation assessed. But if there is a conclict between the said three persons on the one hand and some other person on the othe rsuch as employee or the agency responsible for maintaining the road etc., the question of specification of the amount payable by each set of the parties would not arise because so far as the joint tort feasers are concerned all of them would be liable jointly and severally so far as the claimants are concerned. The answer to the problems, therefore, entirely depends on the interpretation of S. 110 under which the Claims s are set up and conferred with the jurisdiction to deal with the claims for compensation. According to this provision, the Claims is set up to adjudicate upon claims for compensation in respect of the accidents involving the death of, or bodily injury to, persons arising out of the use of motor vehciles, or damages to any property of a third party so arising., or both. So, the has not been conferred with the jurisdiction to deal with the claims of compensations in respect of all kinds of accidents. Instead, its jurisdiction is confined to claims of compensation in respect of those accidents which arise out of the use of motor vehicles. In other words, the use of motor vehicle must be the cause of the accident howsoever slight it may be and unless the accident the effect caused by the use of the motor vehicle it would not be possible to say that it has arisen out of the use of motor vehicle. The interpretation of similar words came up for consideration before of in v. & Leoyd Pty. Letd., 1967 Acc CJ 329. The words used in the insurance policy were \"injury caused by or arising out of the use of the vehicle\". , J. wyhile agreeing with the judgment written by . observed:-- ", "\"The words, 'injury caused by or arising out of the use of the vehicle' postulate a causal relationship between the use of the vehicle and the injury'. Caused by connotes a 'direct' or 'proximate' relationship of cause and effect. 'Arising out of extends this to a result that is less immediate; but it still carries sense of consequence. It excludes cases of bodilyinjury in which the use of the vehicle is a merely causal concomitant not considered to be, in a relevant causal sense, a contributing factor\". ", "32. As stated above, mylearned brother , has relied on case (AIR 1982 All 310) (supra) for laying down the proposition that the claim would be triable by the if in the accident a motor vehicle is involved, nomatter whether the accident has been caused by use of the motor vehicle or not. However, a close analysis of the facts and the observations made in the said case would show that the learned Judge there even did not go that fair. The claim was filed in that case both against the owner of the tempo-taxi as well as represented by the General Manager, which would necessarily mean that the allegation of negligence was both against the driver of themotor vehicle as well as the authorities, may be in the alternative or in composite form. The conclusion arrived at by the Bench was also that in the Circumstances the only reasonable interpretation which appealed to them was the one suggested by the learned counsel for the claimants, namely, that the claims were maintainable against the also. It is, therefore, apparent that neither there wass any question before the said Bench as to whether the claim would be maintainable against the authorities alone nor any opinion was expressed in this regard. The observation of the Bench in that case that they saw no reason either on the plain language of S. 110 or in any other allied provision or the scheme of the Act as manifested by the relevant provisions, which may have inhibited or barred the jurisdiction of the Claims to entertain an pplication for compensation in respect third parties, that is the , have to be appreciated in the context of the facts there. When so done, it wouldbe evident that the observations related to a case where them claim was of composite, nature and not against a third party alone, that is, the . I am, therefore, of the considered view that nothing said even in case (supra) can be understood tomean that the claim petition would been entertainable by the where the motor vehicle has not contributed to the cause, howsoever slight it may be, of the accident resultinhg in the death or bodily injury. ", "33 The claim in the present case has been filed against laone alleging that he accident took place entirely becaue of their carelessness and negligence and that of the driver of the train and the gateman. There being no allegation that the motor vehicle in any way contributed to the cause of the accident, it cannot be said that the same had arisen out of the use of the motor vehicle. As such the present claim would not be entertainable by the and instead would be competent only in . This appeal, therefore, must fail and is accordingly dismissed. No costs. ", ", ", "34. I have the privilege to go through the judgments prepared by and . separately. On giving my thoughtful consideratio. I agree with the view taken by , J. ", "35. In view opf majority judgment, the appeal fails and is accordingly dismissed. No. costs. ", "36. Appeal dismissed."], "relevant_candidates": ["0000068208", "0000758530", "0001363770", "0001453391", "0001902038"]} {"id": "0001829378", "text": ["CASE NO.: Appeal (crl.) 733 of 2001 PETITIONER: Vs. RESPONDENT: STATE OF HARYANA DATE OF JUDGMENT: 22/01/2002 BENCH: , & JUDGMENT: ", "J U D G E M E N T ARIJIT PASAYAT, J. ", " (hereinafter referred to as accused) was awarded \"Sentence of Death\" by the learned Sessions Judge, Sonepat which has been confirmed by . Accusations against him were that he took away the lives of his mother, brother and sister-in-law. It was also alleged that he caused injury on his father (PW-6) and nephew (PW-7). He was tried for allegedly committing offences punishable under Sections 302 , 458 and 324 of the Indian Penal Code 1860 (in short ' IPC '), was found guilty and accordingly convicted. Corresponding sentences imposed were sentence of death, 4 years and 6 months respectively. The sentences were directed to run concurrently. ", "Prosecution version sans unnecessary details is as follows :- ", " (PW-6) had two sons i.e. the accused and (hereinafter referred to the deceased by that name) and a younger brother . The accused and deceased- were residing separately. (PW-6) owned 10 acres of land and had given 2 acres to the accused for the purpose of cultivation. But the accused who was a person of bad habits and a drunkard wasted time in useless pursuits and did not pay any attention to cultivation. He tried to alienate the land that was given to him by his father. This led to rethinking by (PW-6), who took back the land. This led to serious disputes among the members of the family and there were frequent quarrels. On August 5, 1998, deceased and his wife, were sleeping on the roof of the house. (PW-6), his wife , their grandsons (PW-7) and were sleeping in the courtyard. After mid-night (PW-6) heard a noise from the roof of the house and he switched on the electric light. , and woke up and they rushed up stairs and found the accused armed with a Gandasa inflicting blows on both deceased and . After causing injuries to these two, the accused turned towards (PW-6) and others; but they ran down the stairs screaming in fear. The accused followed them and after pushing to the ground inflicted blows on her neck and when PW-6 and PW-7 tried to intervene, he also inflicted blows on both of them. Then he ran away from the spot. PW-6 found that his wife had already succumbed to her injuries. So was the case with his son and daughter-in-law. Next morning, report was lodged at the police station and investigation was undertaken. On completion of investigation, charge-sheet was placed and the accused was charged for offences punishable under Sections 302 / 458 / 324 of the . The accused pleaded innocence. relied on the evidence of PW-6 and PW-7 who were injured eye-witnesses and found the accused guilty of the aforestated offences. After hearing on the question of sentence, he awarded death sentence as noted above. The matter was submitted to for confirmation of the death sentence in terms of Section 366 of the Code of Criminal Procedure, 1973 (in short the 'Code'). held that the judgment suffered from no infirmity to warrant any interference. Accordingly, the reference was accepted and the appeal filed by the accused against the conviction and sentence was dismissed. ", "In support of the appeal before this Court, learned Counsel submitted that both and ignored a very significant fact that the evidence on which prosecution rested, its version was that of relatives. There was admitted hostility, rendering the same suspect. The injuries which were of serious nature on the accused were not explained. That added to vulnerability of prosecution version. Finally, it was submitted that this is not a case which belonged to the category of \"rarest of rare\" to warrant death sentence. The non application of mind according to the learned Counsel is evident from the fact that accused has been treated to be a trespasser in his own house, for holding him guilty of offence punishable under Section 458 of . There is no discussion whatsoever as to how ingredients of that Section are present. ", "In reply, learned counsel for the State of Haryana submitted that there is no probation on conviction being not possible on the evidence of relatives. Additionally, mere non-explanation of injuries, if any, on the accused cannot be a ground for disbelieving prosecution version. The brutal nature of the assaults which resulted in loss of three valuable lives is evident from the nature of injuries noticed on postmortem and on examination of the injured witnesses. In essence, submission was to the effect that no interference is called for in this appeal. ", "We shall first deal with the contention regarding interestedness of the witnesses for furthering prosecution version. Relationship is not a factor to affect credibility of a witness. It is more often than not that a relation would not conceal actual culprit and make allegations against an innocent person. Foundation has to be laid if plea of false implication is made. In such cases, has to adopt a careful approach and analyse evidence to find out whether it is cogent and credible. ", " (AIR 1953 SC 364), it has been laid down as under : ", "\"A witness is normally to be considered independent unless he or she springs from sources which are likely to be tainted and that usually means unless the witness has cause, such as enmity against the accused, to wish to implicate him falsely. Ordinarily, a close relative would be the last person to screen the real culprit and falsely implicate an innocent person. It is true, when feelings run high and there is personal cause for enmity, that there is a tendency to drag in an innocent person against whom a witness has a grudge along with the guilty, but foundation must be laid for such a criticism and the mere fact of relationship far from being a foundation is often a sure guarantee of truth. However, we are not attempting any sweeping generalization. Each case must be judged on its own facts. Our observations are only made to combat what is so often put forward in cases before us as a general rule of prudence. There is no such general rule. Each case must be limited to and be governed by its own facts\". ", "The above decision has since been followed in (AIR 1974 SC 276), in which (AIR 1957 SC 614) was also relied upon. ", "We may also observe that the ground that the witness being a close relative and consequently being a partisan witness, should not be relied upon, has no substance. This theory was repelled by this as early as in case (supra) in which surprise was expressed over the impression which prevailed in the minds of the Members of the that relatives were not independent witnesses. Speaking through , it was observed:- ", "\"We are unable to agree with the learned Judges of that the testimony of the two eye- witnesses requires corroboration. If the foundation for such an observation is based on the fact that the witnesses are women and that the fate of seven men hangs on their testimony, we know of no such rule. If it is grounded on the reason that they are closely related to the deceased we are unable to concur. This is a fallacy common to many criminal cases and one which another Bench of this Court endeavoured to dispel in - ' ', AIR 1952 SC 54 at p. 59 (A). We find, however, that it unfortunately still persists, if not in the judgments of the , at any rate in the arguments of counsel\". ", "Again in (AIR 1965 SC 202), this Court observed:- ", "\"But it would, we think, be unreasonable to contend that evidence given by witnesses should be discarded only on the ground that it is evidence of partisan or interested witnesses. The mechanical rejection of such evidence on the sole ground that it is partisan would invariably lead to failure of justice. No hard and fast rule can be laid down as to how much evidence should be appreciated. Judicial approach has to be cautious in dealing with such evidence; but the plea that such evidence should be rejected because it is partisan cannot be accepted as correct.\" ", "To the same effect is the decision in (AIR 1973 SC 2407). ", "Presence of PWs 6 and 7 at the site of occurrence is natural. They were inmates of the house, and therefore no suspicion as suggested by the accused, regarding their presence can be entertained. Merely because there was some hostility between accused and PWs 6 and 7, it is unbelievable that they would shield the actual culprits to falsely implicate the accused. Their testimony has not been shaken in spite of incisive cross- examination. On the contrary, its credibility has been enhanced because of their acceptance of the fact regarding assault on the accused. The plea that deceased and (PW-6) had many enemies because of their questionable credentials, and they may be the real assailants is too shallow to warrant acceptance. ", "Considering the legal position as analysed above, there is no force in the plea that evidence of PWs 6 and 7 is liable to be discarded merely because they were relatives of the deceased persons. ", "As rightly submitted by the learned Counsel for the accused - appellant, there is no finding recorded by the below as to how ingredients of the offence punishable under Section 458 exist. That being the position, conviction for the said offence is set aside and consequentially, the sentence. In view of the unimpeached evidence of the injured witnesses of PW-6 and PW-7, the conviction for offence punishable under Section 324 does not require any interference. ", "The other question of vital importance is whether death sentence is the appropriate one. Section 302 , IPC prescribes death or life imprisonment as the penalty for murder. While doing so, the Code instructs the as to its application. The changes which the Code has undergone in the last three decades clearly indicate that is taking note of contemporary criminological thought and movement. It is not difficult to discern that in the Code , there is a definite swing towards life imprisonment. Death sentence is ordinarily ruled out and can only be imposed for 'special reasons', as provided in Section 354(3) . There is another provision in the Code which also uses the significant expression 'Special reason'. It is Section 361 . Section 360 of the 1973 Code re-enacts, in substance, Section 562 , of the Criminal Procedure Code , 1898 (in short 'old Code'). Section 361 which is a new provision in the Code makes it mandatory for the to record 'special reasons' for not applying the provisions of Section 360 . Section 361 thus casts a duty upon the to apply the provisions of Section 360 wherever, it is possible to do so and to state 'special reasons' if it does not do so. In the context of Section 360 , the 'special reasons' contemplated by Section 361 must be such as to compel the to hold that it is impossible to reform and rehabilitate the offender after examining the matter with due regard to the age, character and antecedents of the offender and the circumstances in which the offence was committed. This is some indication by the that reformation and rehabilitation of offenders and not mere deterrence, are now among the foremost objects of the administration of criminal justice in our country. Section 361 and Section 354(3) have both entered the Statute Book at the same time and they are part of the emerging picture of acceptance by the legislature of the new trends in criminology. It would not, therefore, be wrong to assume that the personality of the offender as revealed by his age, character, antecedents and other circumstances and the tractability of the offender to reform must necessarily play the most prominent role in determining the sentence to be awarded. Special reasons must have some relation to these factors. Criminal justice deals with complex human problems and diverse human beings. A Judge has to balance the personality of the offender with the circumstances, situations and the reactions and choose the appropriate sentence to be imposed. ", "It should be borne in mind that before the amendment of Section 367(5) , old Code, by the Criminal Procedure Code (Amendment) Act , 1955 (XXVI of 1955) which came into force on January 1, 1956, on a conviction for an offence punishable with death, if the sentenced the accused to any punishment other than death, the reason why sentence of death was not passed had to be stated in the judgment. After the amendment of Section 367(5) of old Code by Act XXVI of 1955, it is not correct to hold that the normal penalty of imprisonment for life cannot be awarded in the absence of extenuating circumstances which reduce the gravity of the offence. The matter is left, after the amendment, to the discretion of the . The must, however, take into account all the circumstances, and state its reasons for whichever of the two sentences it imposes in its discretion. Therefore, the former rule that the normal punishment for murder is death is no longer operative and it is now within the discretion of the to pass either of the two sentences prescribed in this section; but whichever of the two sentences he passes, the Judge must give his reasons for imposing a particular sentence. The amendment of Section 367(5) , of the old Code does not affect the law regulating punishment under the IPC . This amendment relates to procedure and now s are no longer required to elaborate the reasons for not awarding the death penalty; but they cannot depart from sound judicial considerations preferring the lesser punishment. ", "Section 354(3) of the Code, marks a significant shift in the legislative policy underlying the old Code as in force immediately before 1st April, 1974, according to which both the alternative sentences of death or imprisonment for life provided for murder were normal sentences. Now, under Section 354(3) of the Code the normal punishment for murder is imprisonment for life and death penalty is an exception. The court is required to state the reasons for the sentence awarded and in the case of death sentence 'special reasons' are required to be stated, that is to say, only special facts and circumstances will warrant the passing of the death sentence. It is in the light of these successive legislative changes in Code that the juridical decisions prior to the amendment made by Act 26 of 1955 and again Act 2 of 1974 have to be understood. ", "This in (AIR 1974 SC 799) has observed: \"Let us crystallize the positive indicators against death sentence under Indian Law currently. Where the murderer is too young or too old, the clemency of penal justice helps him. Where the offender suffers from socio-economic, psychic or penal compulsions insufficient to attract a legal exception or to downgrade the crime into a lesser one, judicial commutation is permissible. Other general social pressures, warranting judicial notice, with an extenuating impact may, in special cases, induce the lesser penalty. Extraordinary features in the judicial process, such as that the death sentence has hung over the head of the culprit excruciatingly long, may persuade the to be compassionate. Likewise, if others involved in the crime and similarly situated have received the benefit of life imprisonment or if the offence is only constructive, being under Section 302 , read with Section 149 , or again the accused has acted suddenly under another's instigation, without premediation, perhaps the may humanely opt for life, even like where a just cause or real suspicion of wifely infidelity pushed the criminal into the crime. On the other hand, the weapons used and the manner of their use, the horrendous features of the crime and hapless, helpless state of the victim, and the like, steel the heart of the law for a sterner sentence. We cannot obviously feed into a judicial computer all such situations since they are astrological imponderables in an imperfect and undulating society. A legal policy on life or death cannot be left for ad hoc mood or individual predilection and so we have sought to objectify to the extent possible, abandoning retributive ruthlessness, amending the deterrent creed and accepting the trend against the extreme and irrevocable penalty of putting out life\". ", " (AIR 1980 SC 898), it has been observed that \"a real and abiding concern for the dignity of human life postulates resistance to taking life through law's instrumentality. That ought not to be done save in the rarest of rare cases when the alternative option is unquestionably foreclosed\". A balance-sheet of aggravating and mitigating circumstances has to be drawn up and in doing so the mitigating circumstances have to be accorded full weightage and a just balance has to be struck between the aggravating and the mitigating circumstances before the option is exercised. In order to apply these guidelines, inter alia, the following questions may be asked and answered, ", "(a) Is there something uncommon about the crime which renders sentence of imprisonment for the life inadequate and calls for a death sentence?; and (b) Are the circumstances of the crime such that there is no alternative but to impose death sentence even after according maximum weightage to the mitigating circumstances which speak in favour of the offender? ", "Another decision which illuminatingly deals with the question of death sentence is (1983 (3) SCC ", "470). ", "In and cases (supra), the guidelines which are to be kept in view when considering the question whether the case belongs to the rarest of the rare category were indicated. ", "In case (supra), it was observed:- ", "\"The following questions may be asked and answered as a test to determine the 'rarest of the rare' case in which death sentence can be inflicted :- ", "(a) Is there something uncommon about the crime which renders sentence of imprisonment for life inadequate and calls for a death sentence? ", "(b) Are the circumstances of the crime such that there is no alternative but to impose death sentence even after according maximum weightage to the mitigating circumstances which speak in favour of the offender?\" ", "The following guidelines which emerge from case (supra) will have to be applied to the facts of each individual case where the question of imposition of death sentence arises:- ", "(i) The extreme penalty of death need not be inflicted except in gravest cases of extreme culpability. ", "(ii) Before opting for the death penalty the circumstances of the 'offender' also require to be taken into consideration along with the circumstances of the 'crime'. ", "(iii) Life imprisonment is the rule and death sentence is an exception. Death sentence must be imposed only when life imprisonment appears to be an altogether inadequate punishment having regard to the relevant circumstances of the crime, and provided, and only provided, the option to impose sentence of imprisonment for life cannot be conscientiously exercised having regard to the nature and circumstances of the crime and all the relevant circumstances. ", "(iv) A balance-sheet of aggravating and mitigating circumstances has to be drawn up and in doing so the mitigating circumstances has to be accorded full weightage and a just balance has to be struck between the aggravating and the mitigating circumstances before the option is exercised. ", "In rarest of rare cases when the collective conscience of the community is so shocked, that it will expect the holders of the judicial power center to inflict death penalty irrespective of their personal opinion as regards desirability or otherwise of retaining death penalty, death sentence can be awarded. The community may entertain such sentiment in the following circumstances:- ", "(1) When the murder is committed in an extremely brutal, grotesque, diabolical, revolting, or dastardly manner so as to arouse intense and extreme indignation of the community. ", "(2) When the murder is committed for a motive which evinces total depravity and meanness; e.g. murder by hired assassin for money or reward; or cold-blooded murder for gains of a person vis-\u00e0-vis whom the murderer is in a dominating position or in a position of trust; or murder is committed in the course for betrayal of the motherland. ", "(3) When murder of a member of a Scheduled Caste or minority community etc., is committed not for personal reasons but in circumstances which arouse social wrath, or in cases of 'bride burning' or 'dowry deaths' or when murder is committed in order to remarry for the sake of extracting dowry once again or to marry another woman on account of infatuation. ", "(4) When the crime is enormous in proportion. ", "For instance when multiple murders, say of all or almost all the members of a family or a large number of persons of a particular caste, community, or locality, are committed. ", "(5) When the victim of murder is an innocent child, or a helpless woman or old or infirm person or a person vis-\u00e0-vis whom the murderer is in a dominating position, or a public figure generally loved and respected by the community. ", "If upon taking an overall global view of all the circumstances in the light of the aforesaid propositions and taking into account the answers to the questions posed by way of the test for the rarest of rare cases, the circumstances of the case are such that death sentence is warranted, the would proceed to do so. ", "A convict hovers between life and death when the question of gravity of the offence and award of adequate sentence comes up for consideration. Mankind has shifted from the state of nature towards a civilized society and it is no longer the physical opinion of the majority that takes away the liberty of a citizen by convicting him and making him suffer a sentence of imprisonment. Award of punishment following conviction at a trial in a system wedded to the rule of law is the outcome of cool deliberation in the Court-room after adequate hearing is afforded to the parties, accusations are brought against the accused, the prosecuted is given an opportunity of meeting the accusations by establishing his innocence. It is the outcome of cool deliberations and the screening of the material by the informed man i.e. the Judge that leads to determination of the lis. ", "The principle of proportion between crime and punishment is a principle of just desert that serves as the foundation of every criminal sentence that is justifiable. As a principle of criminal justice it is hardly less familiar or less important than the principle that only the guilty ought to be punished. Indeed, the requirement that punishment not be disproportionately great, which is a corollary of just desert, is dictated by the same principle that does not allow punishment of the innocent, for any punishment in excess of what is deserved for the criminal conduct is punishment without guilt. ", "The criminal law adheres in general to the principle of proportionality in prescribing liability according to the culpability of each kind of criminal conduct. It ordinarily allows some significant discretion to the Judge in arriving at a sentence in each case, presumably to permit sentences that reflect more subtle considerations of culpability that are raised by the special facts of each case. Punishment ought always to fit the crime; yet in practice sentences are determined largely by other considerations. Sometimes it is the correctional needs of the perpetrator that are offered to justify a sentence; sometimes the desirability of keeping him out of circulation, and sometimes even the traffic results of his crime. Inevitably these considerations cause a departure from just desert as the basis of punishment and create cases of apparent injustice that are serious and widespread. ", "Proportion between crime and punishment is a goal respected in principle, and in spite of errant notions it remains a strong influence in the determination of sentences. The practice of punishing all serious crimes with equal severity is now unknown in civilized societies; but such a radical departure from the principle of proportionality has disappeared from the law only in recent times. Even now a single grave infraction that is thought to call for uniformly drastic measures. Anything less than a penalty of greatest severity for any serious crime is thought then to be a measure of toleration that is unwarranted and unwise. But in fact quite apart from those considerations that make punishment unjustifiable when it is out of proportion to the crime. Uniformly disproportionate punishment has some very undesirable practical consequences. ", "As the background facts go to show the genesis of dispute between the accused and the other members of his family was land. Accused seems to have taken exception to his father taking away the land from him. As the evidence indicates, he considered his brother, sister- in-law to be responsible for the same. It is also in evidence that 2-3 days before the occurrence, there was a bitter quarrel between the accused and other members of his family. Evidence of PW-7 is to the effect that there used to be constant quarrel between PW-6, deceased , deceased on one hand and the accused on the other, over ancestral land. It is also in evidence that the deceased was not of moral character and PW-6 had forcibly occupied the land of temple for which villagers had set on fire a piece of their house. Though injuries on accused person do not per se affect prosecution version if reliable; when not explained it assumes importance if they are serious in nature. The fact that the injuries were sustained in the present case by the accused is not disputed. In fact, PW-7 has admitted that PW-6 had given a thorough thrashing to the accused in the court-yard after assaults on the three accused persons. As the medical evidence indicates, the injuries sustained by the accused were of very serious nature. It is true three lives have been lost. But at the same time, the mental condition of the accused which led to the assault cannot be lost sight of. The same may not be relevant to judge culpability. But is certainly a factor while considering question of sentence. There is no evidence of any diabolic planning to commit the crime, though cruel was the act. Deprived of his livelihood on account of the land being taken away, the accused was, as the evidence shows, exhibiting his displeasure, his resentment. Frequency of the quarrels indicate lack of any sinister planning to take away lives of the deceased. The factual scenario gives impressions of impulsive act and not planned assaults. In the peculiar background, death sentence would not be proper. A sentence of imprisonment for life will be more appropriate. The sentence is accordingly modified, while confirming the conviction for offence punishable under Section 302 . ", "Appeal is allowed to the extent indicated above. We record our appreciation for the assistance rendered by Mr. who was appointed as amicus curiae. ", ".. ", "(M. B. SHAH) .J. ", "( ", "(ARIJIT PASAYAT) January 22, 2002"], "relevant_candidates": ["0000307021", "0000313314", "0000406841", "0000545301", "0000674898", "0001420504", "0001487227", "0001496005", "0032790580"]} {"id": "0001832060", "text": [", Member (J) ", "1.This a revision petition filed before which on transfer is being treated as an appeal. ", "2. The appellant has manufactured at his site at Chibramau Cold Storage, Farrukhabad, diffusers and condensers which are parts of refrigerating and air-conditioning machinery. The appellants did not pay duty for their products. The fact was discovered by the authorities on an inspection of the appellants' Cold Storage on 24-3-1976. The party had manufactured three diffusers each of 2500' length of 1\" diametre pipe, three condensers each of 12 pipes of 20\" X 2\" diameter, and 5 condensers each of 12 pipes of 20\" length x 2\" diameter. These items had been installed in their cold storage as parts of refrigerating and air-conditioning machinery. A show cause notice was issued demanding duty besides imposition of penalty. The appellants contended that the parts did not attract duty under Tariff Item No. 29A(3). The appellants were only arranging the pipes and diffusers in a zig-zag way and that the parts did not form part of refrigerating and air-conditioning machinery. He also relied on the judgment of (1980 E.L.T. 600) in support of his contentions, The Assistant Collector upheld the demand for duty and imposed a penalty of Rs. 250/- for contravention of the provisions of the Act. The appellant preferred an appeal and the Appellate Collector upheld the order of lower authority and rejected the appeal. ", "3. , Advocate for the appellants, argued that the appellants were not manufacturing or offering for sale parts of any refrigerating and air-conditioning machinery and were therefore not liable to pay duty. In support of his arguments, he relied on a judgment of in Messrs , v. and Ors. (reported as in 1980 E.L.T. p. 600). ", "4. , the , argued that the parts manufactured were condensers and diffusers which would amount to parts of air-conditioning and refrigerating machinery. He also submitted that the appellants had removed the goods without any intimation to the authorities or filing the necessary classification lists. In other words, he pointed out that the provisions of Rule 9 with Rule 49 of the Central Excise Rules, 1944 would be attracted. Even if the goods were captively utilised by the appellants, they would be dutiable. On the question of applicability of the Tariff Item 29(A)(3), he pointed out that the latest ruling of reported in the 1984 E.L.T. p. 333 ( .) supported the view of the department, that cooling coils and condensers would squarely fall within the description of Item 29(AX3) of the Central Excise Tariff. He emphasised that this judgment has considered various citations including the ruling of the Hon'ble , and being the latest decision should be applicable to the present facts. He also cited the case decided by in the matter of . ", "5. We have considered all the relevant arguments advanced by the party in order to come to careful consideration of the respective submissions. On the question of excisability of the product, the latest pronouncement of in 1984 E.L.T. 333 is against the appellants. The Hon'ble Gujarat High Court after noting and dissenting from the judgment and its own earlier decision has held that the parts of refrigerating and air-conditioning appliances and machinery would attract duty under Item 29A(3). ", "6. In this connection, it is also pointed out by that a special leave petition against the decision of Hon'ble Allahabad High Court in has been admitted by . We also find that after rendering of the decision of the Hon'ble Allahabad High Court, Rule 9 and Rule 49 of the Central Excise Rules have been amended by the Notification of the Government of India in the Ministry of Finance () G.S.R. 74(E), dated 20-2-1982. In view of the change in the circumstances and in view of the reasoning set out in the latest judgment, we are inclined to support and follow the reasoning set out in 1984 E.L.T. 333. The learned counsel for the appellants argued that the appellants' factory is situated within the jurisdiction of the Hon'ble Allahabad High Court and that the decision of should not be applied to their factory. He also filed written statements on 22-3-1984 stating that the has to follow the ruling of in the territory of which the cause of action has arisen in preference to the rulings of other on the same point. ", "7. We have given our anxious thought on these arguments. The rulings cited by the learned counsel for the appellants in his written submission of 1976 AIR Andhra Pradesh-p. 84 ( .) and 1973 1 Cases 446 ( ) have no application there in the cause of action wholly or part arose within the jurisdiction of the respective exercising jurisdiction. As already observed, the issue involved is one relating to rate of duty and value of the goods for the purpose of assessment. Further, we have already pointed out the circumstances which lead us to apply the ratio of the latest decision. Hence we are unable to accept the contentions of the learned counsel for the appellants. ", "8. Even considering the matter on the basis of Tariff Entry, the petitioner's contentions cannot be approved. Tariff 29A reads as follows : ", "\"29A. Refrigerating and Air-conditioring appliances and Machinery, all sorts, and parts thereof : ", "1. Refrigerators and other refrigerating appliances which 20% ad are ordinarily sold or offered for sale as ready assemb- valorem. led units, such as ice makers, bottle coolers, display cabinets and water coolers. ", "2. Air-conditioners and other air-conditioning appliances, 20% ad which are ordinarily sold or offered for sale as ready valorem. assembled units, including package type air-conditioners and evaporative type of coolers. ", "3. Parts of refrigerating and air-conditioning appliances 30% ad and machinery, all sorts. valorem. ", "Item 3 contemplates parts of refrigerating and air-conditioning appliances and macbincy. The appellants had admittedly manufactured the parts intended for refrigeration and air-conditioning appliances and has installed them in their plant. The concept of sale envisaged under Sub-clauses 1 and 2 would not be applicable in respect of Item 3. Even otherwise, Rule 9 has been amended and excisable goods manufactured in any place utilised as such should be deemed to have been removed. Admittedly, no intimation was given to the concerned authorities before the removal of the goods. The appellants cannot be heard to say that they did not manufacture any refrigerating or air-conditioning parts in the commercial sense. The mere fact that there was no sale as condensers, diffusers or compressors will not help the appellants. ", "9. The learned counsel for the appellants relied on the decision in Order No. B-l 10/ , in which this followed the decision in of the Hon'ble Allahabad High Court. The decision rendered by the Hon'ble Gujarat High Court in 1984 E.L.T. p. 333 cited (supra) has been reported subsequent to that decision. Even otherwise, this court is inclined to follow the later ruling. Further, on facts it is seen that the product concerned in the decision B-110/84 consisted of a secondhand air-compressor with copper tubes soldered in a zig-zag way and connected to the wooden box with a compressor by a milk vendor of small means. Though the department critically considered it as part of the refrigerating machinery, this , on a considerntion of all the facts placed, upheld the case of the assessee. That decision does not apply to the present facts where the appellants have manufactured diffusers and condensers. Mr. also urged that the amendment of Rule 9 retrospectively would be invalid. He placed reliance on AIR 1970 S.C. p. 1950. But as rightly pointed out by , the amendment of Rule 9 and Rule 49 were approved by . The retrospective effect of the amendment was pursuant to the Finance Bill of 1982. The being the rule making authority has unrestricted powers to emend the Rule. ", "10 The removal was without any information to the department and hence the infringement of Rule 9 has been made out. The show cause notice has been issued on 4-7-1976 prior to the amendment of Rule 10. The restricted shorter period of limitation of six months would not apply. ", "11 Though the appellants have contravened the provisions of the statute, the circumstances under which the contravention took place, especially in view of the unsettled state of affairs with conflicting decisions should be adverted to This situation definitely calls for interference in respect of the personal penalty Hence while confirming the demand for duty. the penalty imposed is set aside. The order of the lower authorities is modified accordingly and the appeal is allowed in part."], "relevant_candidates": ["0000231567", "0000597979", "0000642993", "0001601316", "0001634036", "0001995713"]} {"id": "0001865791", "text": ["PETITIONER: STATE BANK OF PATIALA & ORS Vs. RESPONDENT: DATE OF JUDGMENT: 27/03/1996 BENCH: JEEVAN REDDY, B.P. (J) BENCH: JEEVAN REDDY, , K.S.(J) CITATION: 1996 AIR 1669 1996 SCC (3) 364 JT 1996 (3) 722 1996 SCALE (3)202 ACT: HEADNOTE: JUDGMENT: ", "J U D G M E N T B.P JEEVAN REDDY,J Leave granted. Heard counsel for the parties. This appeal preferred against the judgment and decree of dismissing the second appeal filed by the appellant raises certain basic questions concerning natural Justice in the context of disciplinary proceedings. ", "A disciplinary enquiry was held against the respondent in respect of two charges. They are: ", "\"Charge No.1 'That he did not deposit the sum of Rs.10,000/- handed over to him by in December 1985, in the crop loan account of Sh. S/o . Later on the entire amount of Rs.11,517=50 outstanding in the account was deposited by someone on the 22nd March 1986 under the signature of ah . He thus utilised the amount of Rs.10,000/- for approximately 3 months for his own advantage.' Charge No.II 'That hes in contravention of Regulation 50(4) of the State of Patiala (Officers') Service Regulations 1979, issued an undated letter in, his own handwriting addressed to the Tehsildars Bhatinda for revocation of Mutation on the land mortgaged to the even when the crop loan account of Shri was not adjusted. He thus jeopardized the interests of the '.\" ", "At the relevant time, the respondent was working as the Manager of Kot Fatta branch Of the appellant-. The charge against the respondent, in short. is one of temporary misappropriation. One had taken a loan of Rupees ten thousand from the . After 's death, his son, , came and handed over a sum of Rupees ten thousand to the respondent in Decembers 1985 in discharge of the said loan. In February, 1986, the respondent was transferred to another branch. In March, went to the and discovered that the amount paid by him to the respondent was not credited to his/his father's account. Soon thereafter, a sum of Rs.11,517.50p was deposited in the in the name of . The appellant 's case is that having received the amount from in December, 1985, the respondent did not credit the said amount into the account until March, 1986, though he issued a letter addressed to in December, 1985 itself to the effect that since the crop loan amount has been adjusted, the entry regarding mortgage of land of in favour of the be revoked. ", "Before ordering a regular oral enquiry, the had directed and to conduct a preliminary enquiry. The said officers examined witnesses including and the Patwari of the village, , and also gathered necessary documentary evidence. It is on the basis of the material so gathered and the preliminary report they submitted that the regular oral enquiry was ordered. In the enquiry, six witnesses (PWs.1 to ", "6) were examined on behalf of the and three witnesses (DWs.1 to 3) on behalf of the respondent. The examined Sri and Sri who had conducted the preliminary enquiry and recorded the statements of among others. The , , was examined as PW-5. The other three witnesses, PWs.3, 4 and 6 are the employees of the who spoke to the various aspects of the 's case. who was the complainant did not appear as a witness at the regular enquiry inspite of several attempts made to procure his presence, though his statement had been recorded during the preliminary enquiry. ", "At the conclusion of the enquiry, a report was submitted by the enquiry officer holding both the charges established. The competent authority accepted the report and ordered the removal of the respondent from the service. An appeal and a review submitted by the respondent were dismissed. The respondent thereupon instituted a suit in the court of learned Sub-Judge, IInd Class, for a declaration that the order of removal is void and illegal and for a declaration that he continues to be in service with all consequential benefits. rejected all the grounds urged by the respondent in support of his case except one, viz., that \"the list of witnesses and list of documents were not supplied along with charge-sheet and then the same were not supplied by the presenting officer during the course of enquiry\". On the only ground that \"this argument of the learned, counsel for the plaintiff was not meted out by the learned counsel for the defendants in, his written arguments\", held the allegation established. It found that the said failure to supply is violative of Regulation 68(X)(b)(iii) of the State of Patiala (Officers') Service Regulations, 1979 and on that basis, decreed the suit. On appeal, the judgment and the decree of was affirmed. found the following facts: during the course of enquiry, the presenting officer filed a provisional list of documents/ witnesses (P-2) on June 2,1987. The list contained nine documents including the statements of , , and , complainant. The said documents were marked as P-3 to P-11. Though a copy of the list of documents/statements was supplied to the respondent- plaintiff, copies of the documents P-3 to P-11 were not supplied to him. He was however, advised , examine and take notes of the said documents/ statements. This opportunity was given only half an hour before the commencement of the enquiry proceedings. found that in the above circumstances, there was a clear violation of Regulation 68 which has prejudicially affected the respondent's defence. The second appeal filed by the was dismissed by a learned single Judge of affirming the said finding. The learned Judge in fact assigned one more ground in support of the respondent's case, viz., that inasmuch as was not examined, it is a case of no evidence'. Before entering upon the discussion of issues arising herein, it is well to reiterate the well-accepted proposition that the scope of judicial review in these matters is the same whether it is a writ petition filed under Article 226 of the Constitution of India or a suit filed in the civil court. ", "To clear the ground for considering the main question arising herein, we may first dispose of the additional ground assigned by . Because , the complainant, was not examined, it cannot to be a case of no evidence. As stated above, as many as six witnesses were examined including two officers of the who conducted the preliminary enquiry and had recorded the statements of witnesses including . They spoke to the preliminary enquiry conducted by them and the Statement of recorded by them. Other officials were examined to establish that the letter Exh.P-6 addressed to the Tehsildar, was in fact written by and bears the signature of the respondent. , Patwari, was also examined. It is on the basis of this evidence that the enquiry officer had come to the conclusion that both the charges were established inspite of non-examination of . Neither nor the first have found that it is a case of no evidence. The additional ground assigned by is, therefore, unsustainable in law. ", "Now, coming to the main ground upon which the plaintiff's case has been decreed, viz., the nonfurnishing of the copies of the statements of witnesses and documents, the factual position as found by is to the following effect: though a list of documents/witnesses was furnished to the respondent before the commencement of the enquiry, the copies of the documents and statements recorded during the preliminary enquiry were not supplied to the respondent. Half an hour before the commencement of the enquiry proceedings, the respondent was advised to peruse the said documents and the statements of witnesses which he did. was not examined at the regular enquiry. The other witness who was examined during the preliminary enquiry, , Patwari, was examined at the regular enquiry. The question is whether on the above facts, it can be held that there is a violation of Regulation 68 and whether the violation, if any, vitiates the enquiry. Regulation 68 insofar as is relevant, reads thus: ", "\"(a) The inquiring authority shall where the officer does not admit all or any of the articles of charge furnish to such officer a list of documents by which and a list of witnesses by whom, the articles ", "(b) The inquiring authority shall also record an order that the officer may for the purpose of preparing his defence: ", "i)Inspect and take notes of the document listed within five days of the order or within such further time not exceeding five days as the inquiring authority may allow: ", "ii) submit a list of documents and witnesses that he wants for enquiry. ", "iii) be supplied with copies of statements of witnesses, if any, recorded earlier and shall furnish such copies not later than three days before the commencement of the examination of the witnesses by . ", "(Emphasis added) ", "iv) gave a notice within ten days of the order or within such further time not exceeding ten days as the inquiring authority may allow for the discovery of production of the documents referred to at (ii) above.\" ", "[Taken from the judgment of ] It is sub-clause (iii) which is said to have been violated in this case. The sub-clause provides that copies of the statements of witnesses, if any, recorded earlier shall be furnished to the delinquent officer \"not later three days before the commencement of the examination of witnesses by .\" From judgment, it appears that on June 2, 1987, the respondent was given an opportunity of perusing and taking notes from the said documents and statements of witnesses and that the enquiry also commenced on that day. lt, however, appears from a copy of the enquiry report that the six witnesses for the were examined on the following dates: S/Sri K.S.Wadhan and P.N.Garg (PWs.1 and 2) on July 6, 1987, S/Sri Mangat Rai Verma, and (PWs.3, 4 and 5) on July 7, 1987 and Sri The three defence witnesses so examined on July 27, 1987. It is thus evident that though copies of the statements of and were not supplied to the respondents he was permitted to peruse the same more than three days prior to the examination of witnesses. It is necessary to emphasize that sub-clause -(iii) aforesaid only speaks of copies of statements of witnesses recorded earlier and does not refer to documents. So far as the documents are concerned the only right given to the delinquent officer by Regulation 68 is to inspect and take notes and that has been done. Coming back to the statements of witnesses was not examined at the oral enquiry at all as stated above. Only , Patwari, was examined. The issue boils down to this whether the failure to literally comply with sub-clause (iii) of clause (b) of Regulation 68(ii)(x)vitiates the enquiry altogether or whether it can be held in the circumstances that there has been a substantial compliance with the said sub-clause and that on that account, the enquiry and the punishment awarded cannot be said to have been vitiated. ", "Sub-clause (iii) aforesaid is indisputably part of a regulation made in exercise of statutory authority. The sub- clause incorporates a facet of the principle of natural justice. It is designed to provide an adequate opportunity to the delinquent office- to cross-examine the witnesses effectively and thereby defend himself properly. It is relevant to note in this behalf that neither the enquiry officers' report nor the judgment of , or say that the respondent had protested at the relevant time that he was denied of an adequate opportunity to cross-examine the witnesses effectively or to defend himself properly on account of non- supply of the statements of witnesses. The , on the contrary, has recorded that when he was advised to peruse, examine and take note; from the documents including the statements of witnesses [ and ], the only objection raised by the respondent was that \"the documents marked Exh.P-6, P-10 and P-11 were only photostat copies and not originals and should not be considered or marked exhibits\". [Exhs. P-6, P-10 and P-11 are documents other than the statements of witnesses, i.e., of and .] Moreover, as pointed out above, the examination of witnesses began long after the expiry of three days from the day on which the respondent was advised to and he did peruse the documents and statements of witnesses. In the circumstances, it is possible to say that there has been a substantial compliance with the aforesaid sub-clause (iii} in the facts and circumstances of this case though not a full compliance. This in turn question whether each and every violation of rules or regulations governing the enquiry automatically vitiates the enquiry and the punishment awarded or whether the test of substantial compliance can be invoked in cases of such violation and whether the issue has to be examined from the point of view of prejudice. So far as the position obtaining under the Code of Civil Procedure and Code of Criminal Procedure is concerned, there are specific provisions thereunder providing for such situation. There is Section 99 of the Code of Civil Procedure and Chapter 35. of the Code of Criminal Procedure. Section 99 C.P.C. says, \"no decree shall be reversed or substantially varied nor shall any case be remanded in appeal on account of any misjoinder or nonjoinder of parties or causes of action or any error defect or irregularity in any proceeding in the suit, not affecting the merits of the case or the jurisdiction of .\" Section 465(1) of the Criminal Procedure Code, which occurs in Chapter 35 similarly provides that \"subject to the provisions hereinbefore contained no finding sentence or order passed by a court of competent jurisdiction shall be reversed or altered by a court of appeal, confirmation or revision on account of any error, omission or irregularity in the complaint, summons, warrant, proclamation, order, judgment or other proceedings before or during trial or in any enquiry or other proceedings under this code or any error or irregularity in any sanction for the prosecution unless in the opinion of that court a failure of justice has in fact been occasioned thereby.\" ", "It is not brought to our notice that the State Bank of Patiala (Officers') Service Regulation contains provision corresponding to Section 99 C.P.C. or Section 465 . Does it mean that any and every violation of the regulations renders the enquiry and the punishment void or whether the principle underlying Section 99 C.P.C. and Section 465 . is applicable in the case of disciplinary proceedings as well. In our opinion, the test in such cases should be one of prejudice, as would be later explained in this judgment. But this statement is subject to a rider. The regulations may contain certain substantive provisions, e.g., who is the authority competent to impose a particular punishment on a particular employee/officer. Such provisions must be strictly complied with. But there may be any number of procedural provisions which stand on a different footing. We must hasten to add that even among procedural provisions, there may be some provisions which are of a fundamental nature in the case of which the theory of substantial compliance may not be applicable For examples take a case where a rule expressly provides that the delinquent officer/employee shall be given an opportunity to produce evidence/material in support evidence of the other side. If no such opportunity is given at all inspite of a request therefor, will be difficu to say that the enquiry is not vitiated. But in respect of many procedural provisions it would be possible to apply the theory of substantial compliance or the test of prejudices as the case may be. The position can be stated in the following words: Regulations which are of a substantive nature have to be complied with and in case of such provisions, the theory of substantial compliance would not be available. (2) Even among procedural provisions, there may be some provisions of a fundamental nature which have to be complied with and in whose case, the theory of substantial compliance may not be available. (s) In respect of procedural provisions other than of a fundamental nature the theory of substantial compliance would be available. In complain objection on this score have to be judged on the touch-stone of prejudices as explained later in this judgment. In other words the test is: all things taken together whether the delinquent officer/employee had or did not have a fair hearing. We may clarify that which provision falls in which of the aforesaid categories is a matter to he decided in each case having regard to the nature and character of the relevant provision. ", "It would be appropriate to pause here and clarify a doubt which one may entertain with respect to the principles aforestated. The several procedural provisions governing the disciplinary enquiries whether provided by rules made under the proviso to Article 309 of the constitutions under regulations made by statutory bodies in exercise of the power conferred by a statute or for that matter, by way of a statute] are nothing but elaboration of the principles of natural justice and their several facets. It is a case of codification of the several facets of rule of audi alteram partem or the rule against bias. One may ask, if a decision arrived at in violation of principles of natural justice is voids how come a decision arrived at in violation of rules regulations/statutory provisions incorporating the said rules can be said to be not void in certain situations. It is this doubt which needs a clarification - which in turn calls for a discussion of the question whether a decision arrived at in violation of any and every facet of principles of natural Justice is void. ", "The first decision on this aspect is that of in v. [1964 A.C.40] and the oft- quoted words are that of Lord , to wit \"Then there was considerable argument whether in the result the watch committee's decision was void or merely voidable. Time and time again in the cases I have cited it has been stated that a decision given without regard to the principles of natural justice is void and that was expressly decided in v. (1874) LR 9 Ex.190. ", "I see no reason to doubt these authorities. The body with the power to decide cannot lawfully proceed to make a decision until it has afforded to the person affected a proper opportunity to state his case.\" ", "It must, however, be remembered that was a case where the appellant-chief constable was dismissed without notice and without enquiry. He was tried and acquitted on a criminal charge of conspiracy to obstruct the course of justice. Two other police constables who were tried alongwith him were convicted. While acquitting the appellant, the learned Judge commented adversely at more than one place upon the leadership qualities of the chief constable suggesting that he was found wanting in that respect. Thereupon , without giving any notice or hearing to him dismissed him from service. The violation was thus of a fundamental nature. It was a case of total violation of the principle of natural justice*. There could not be a greater violation of natural justice than that. ", "We may now consider the decision of in v. [1968 (1) W.L.R.1278]. The facts of this case are rather involved. The Singapore Municipal Ordinance provided that in a case of misconduct which in the opinion of the head of the department merited dismissal the head of the department should outline the case to the president or the deputy president and hold an ", "------------------------------------------------------------ *It is in this context, it was observed that it is not open to an authority which has not given a notice or hearing to the affected person to say that even if it had given such an opportunity the affected person had nothing worthwhile to say or that the result would not have been different even if such a notice or hearing is given. Of course no definite opinion was expressed on this aspect in v., as pointed out by in Maradana Mosque Trustees v. (1967 (1) A.C.13 at 24). ", "enquiry, The record of enquiry shall thereafter be considered by the president or the deputy president who was entitled to cause such further enquiry as he may think appropriate and then make his final decision. If the decision was to dismiss the employee, the decision was to be conveyed by the head of the department to the employee who was given a right of appeal to . The appellants were daily rated unskilled labourers. On the allegation of misconducts an enquiry was held by the head of the department wherein the appellants participated, Thereafter, the deputy president asked certain questions from the head of the department and the latter supplied the necessary information. This was not disclosed to the appellants. They were dismissed. On appeals a de novo hearing was afforded to the appellants by . Thereupon the appellants brought an action in which ultimately reached . he recalled in the first instances the statement of law on this subject as stated by Lord in v. to the effect that unless the conditions of service are governed by a statute or statutory rules principles of natural justice have no place in a dispute between master and servant. The statement from runs thus: ", "\"The law regarding master and servant is not in doubt There cannot be specific performance of a contract of service, and the master can terminate the contract with his servant at any time and for any reason or for none But if he does so in a manner not warranted by the contract he must pay damages for breach of contract So the question in a pure case of master and servant does not at all depend on whether the master has heard-the servant in his own defence; it depends on whether the facts emerging at the trial prove breach of contract But this kind of case can resemble dismissal from an office where the body employing the man is under some statutory or other restriction as to the kind of contract which it can make with its servants, or the grounds on which it can dismiss them.\" ", "On the facts of the appeal before them, held, in the first instance, that at the stage of the deputy president asking questions and the head of the department supplying him information, the principles of natural justice had no application Alternately, they held that even if the said principles did apply, even then it must be held that the said violation was cured by what happened before [i.e., on appeal] Since there was a re-hearing before and evidence was called de novo and also because no grievance was made with to the proceedings before , the invalidity arising from the violation of principles of natural justice at the earlier stage was cured. This decision was referred with approval in 1980 by in v. ** [1980 A.C.574] in the following words: ", "\"Their Lordships regard this as a decision that in the context, namely one of regulations concerning establishments procedures, justice can be held to be done if, after all these procedures had been gone through, the dismissed person has had a fair hearing and put his case. It is thus an authority in favouring the existence of the intermediate category, but not necessarily one in favour of a general rule that first instance defects are cured by an appeal. Their Lordships are also of opinion that the phrase 'hearing of evidence de novo,' though useful in that case, does not provide a universal solvent. What is required is examination of the hearing process, original and appeal as a whole, and a decision on the question whether after it has been gone through the complainant has had a fair deal of the kind that he bargained for.\" ", "(Emphasis added) ", "------------------------------------------------------------ ** v. was a case where the first- contention of the plaintiff was that since the decision against him was arrived at in violation of the principle of natural justice, it was void and no appeal lay against an order which was void. \"A condition precedent, it was said, of an appeal was the existence of a real, even though voidable decision\". dealt with the argument in the following words: \"This argument has led necessarily into the difficult area of what is void and what is voidable, as to which some confusion exists in the authorities. Their Lordships opinion would be, if it become necessary to fix upon one or other of these expressions, that a decision made contrary to natural justice is void, but that, until it is so declared by a competent body or court, it may have some effect, or existence, in law. This condition might be better expressed by saying that the decision is invalid or vitiated. In the present context, where the question is whether an appeal lies, the impugned decision cannot be considered as totally void, in the sense of being legally non-existent. So to hold would be wholly unreal.\" ", " v. Secretary of for (1990 (1) R.C.876) was an interesting case. On the ground of overstaying in United Kingdom, the appellant was given a notice proposing to deport him. The appellant's solicitors lodged a notice of appeal and informed the appellants on his correct address, of the action taken by them. When the solicitors were notified of the date of hearing, they wrote to the appellant informing him of the date of hearing, but this letter was sent on the old address. The appellant did not receive it. The solicitors, finding no response from the appellants took no steps in the matter and the appeal was dismissed. The solicitors again wrote to the appellant but on the old address again. When sought to be deported, the appellant applied for judicial review of the deportation order on the ground of absence of notice; to him. and upheld his plea holding that notwithstanding absence of fault by the there had been a breach of the principle of audi alteram partem, which constituted a fundamental flaw in the decision- making since the fault lay entirely with the appellant's solicitors there was a clear case for quashing the 's decision. On appeal to , the decision of and was reversed. [Lord Bridge] observed: \"a party to the dispute who has last the opportunity to have his case heard through the default of his own advisers to whom he has entrusted the conduct of the dispute on his behalf cannot complain that he has been the victim of the procedural impropriety or that natural justice has been denied to him ......\". In other words, was of the opinion that natural justice merely imposed standards of procedural fairness on the decision-making authority and that natural justice does not demand that the person affected should actually receive a fair hearing. ", "We must, however, make it clear that it may be difficult to find uniformity in the large number of decided cases in United Kingdom. For example, take the decision of in v. [1971 (2) All.E.R.1278]. It was a case ____________________________________________________________ ***This reminds us of what of Canada said with respect to the meaning of the words \"principles of fundamental justice\". Section 7 of the Canadian Charter of Rights and Freedoms, 1982 declares \"every one has the right to life, liberty and security of the person and the right not to be deprived thereof except in accordance with the Principles of fundamental justice\" In R v. Beare [1988 (2) S.C.R.387], of Canada while interpreting the words \"principles of fundamental justice\" said that it \"guarantees fair procedure but does not guarantee the most favourable procedure that can possibly be imagined\". Also see v. Canada [1992 (1) Reports ", "581. where the concerned statute mandated that no resolution of far the dismissal of a certificated teacher was to be valid unless notice of the motion for dismissal was sent to the teacher not less than three weeks previous to the meeting. And, further that the resolution for the dismissal was not to be valid unless agreed to by the majority of the full members of the . The teacher concerned, , was informed more than three weeks in advance. But his written request for an opportunity to submit counter representations was not granted and though he was present at the decisive meeting, he was not permitted to state his case. The Court held that the statutory requirement of three weeks notice before the decision was taken, conferred an implied right to be heard. It was not done. By the notice dated March 19, 1969, the service off the teacher was terminated with effect from April 24, 1969. held that the concerned teacher was denied by the education authority, which employed him, the hearing to which he was entitled. It was further found that the hearing to be afforded would not be a useless formality, as there was an arguable case for the teacher. Nonetheless, it was observed by Lord [at P.1283]: ", "\"...... it was argued that to have afforded a hearing to the appellant before dismissing him would have been a useless formality because whatever he might have said could have made no difference. If that could be clearly demonstrated it might be a good answer. ", "Lord Guest [at P.1291] not only agreed with the above statement but also applied the test of prejudice. He observed: ", "\"A great many arguments might have been put forward but forward but if none of them had any chance of success then I can see no good reason why the respondents should have given the appellant a hearing, nor can I see that he was prejudiced in any way. \" ", "Lord too stated the principle in the following words [at P.1294]: ", "\"The appellant has first to show that his position was such that he had, in principle, a right to make representations before a decision against him was taken. But to show this is not necessarily enough, unless he was also show that if admitted to state his case he had a case of substance to make . A breach of procedure, whether failure of natural justice, administrative fault, cannot give him a remedy in the courts, unless behind it there is something of substance which has been lost by the failure. The court does not act in vain.\" ", " of state for Transport, ex parte Gwent County Council [1987 (1) All.E.R.161], too applied the test of prejudice in enhancement of toll charges over a bridge. The Act provided for a public hearing before effecting increase. Dealing with a complaint of procedural impropriety, held that unless. prejudice is established to have resulted from the procedural impropriety, no interference was called for. In another case, v. Secretary of for Environment [1981 A.C.75 held that in the absence of statutory rules as to the conduct of a local enquiry under the Highways Act s 1959 the procedure to be followed was a matter of discretion for the Secretary of and the Inspector - the only requirement being that the procedure followed should be fair to all concerned including the general public. It is thus clear that the approach of the Court depended upon the facts and circumstances of each case, the law applicables the nature of the right claimed by the person affected and so on. Having considered the principles emerging from the above cases, we are inclined to say that the aforesaid statement of law in v. , stated with reference to , is the appropriate one to adopt as a general rule - and we are supported by the decisions of this Court in saying so. We must s however, forewarn that decisions on the applicability of the principles of possible nor necessary to refer to all of them, particularly in view of the recent judgments. We will refer only to a few of them to explain our view point. ", " (1958 S.C.R. 595] S.R.Das,CJ., speaking for the Constitution Bench, had this to say: ", "\"If an inferior court or tribunal of first instance acts wholly without jurisdiction or patently in excess of jurisdiction or manifestly conducts the proceedings before it in a manner which is contrary to the rules of natural justice and all accepted rules of procedure and which offends the superior court's sense of fair play, the superior court may, we thinks quite properly exercise its power to issue the prerogative writ of certiorari to correct the error of the court or tribunal of first instance, even if an appeal to another inferior court or tribunal was available and recourse was not had to it or if recourse was had to its it confirmed what ex-facie was a nullity for reasons aforementioned.\" ", " [1969 (3) S.C.C.392], Hidayatullah,CJ. [speaking for the Bench comprising himself and G.K.Mitter,J.] made the following pertinent observations: ", "\"From this material it is aruged that the principles of natural justice were violated because the right of the appellant to have his own evidence recorded was denied to him and further that the material which was gathered behind his back was used in determining his guilt. In support of these contentions a number of rulings are cited chief among which are (1965) 3 SCR 135; (1967) 3 SCR 49. There is no doubt that if the principles of natural justice are violated and there is by striking down the order of dismissal; but there are cases and cases. We have to look to what actual prejudice has been caused to a person by the supposed denial to him of particular right.....Anyway the questions which were put to the witnesses were recorded and sent to the Chief Engineer and his replies were received. No doubt the replies were not put in the hands of the appellant but he saw them at the time when he was making the representation and curiously enough he used those replies in his defence. In other words, they were not collected behind his back and could be used to his advantage and he had an opportunity of so using them in his defence. We do not think that any prejudice was caused to the appellant in his case by not examining the two retired Superintending Engineers whom he had cited or any one of them.\" ", "(Emphasis added) Pausing here, we may notice two decisions of this Court where the test of prejudice was rejected, viz., v. Secretary (F&A) Government of Andhra Pradesh (1977 A.P. 2313) and (1981 (1) 3.C.R.746) both rendered by three-Judge . But if one notices the facts of those cases, it would be evident that they were cases of total absence of notice as in the case of v. . In the former case, the Government allowed a revision filed under Section 77 of the Andhra Pradesh Cooperative Societies Act, 1964 without notice to opposite party, inspite of a request therefor. Para-9 brings out the factual position and Para-11 the legal proposition. They read thus: ", "\"On the very day, viz., 6th October, 1976 when the respondents filed their revision before the , the appellant filed an application to the disputing the claim of the village societies. The appellant also filed before the on 28th October, 1976. On 5th November, 1976, the appellant prayed to the for an opportunity to file counter in the revision petition filed by the respondents. The , however, without any notice to the appellant, passed final orders on 4th December, 1976, allowing the two review petitions filed by the village societies and set aside the order of the Registrar dated 10th December, 1975..... ", "The short question that arises for decision is whether the order of the in revision which was passed under section 77 of the Act is invalid for non-compliance with section 77(2) which provides that no order rejudicial to any person shall be passed under sub- section (1) unless such person has been given an opportunity of making his representation. It is submitted that the did not afford any opportunity to the appellant for making representation before it. rejected this plea on the ground that from a perusal of the voluntary application filed by the appellant it was clear that the appellant had anyhow met with the points urged by the respondents in their revision petition before the . We are, however, unable to accept the view of as correct.\" ", "Similarly, 's case was one where was superseded even without a notice to the committee, again a case like v. . After referring to certain English and Indian decisions, J.made the following observation: ", "\"In our view the principle of natural justice know of justice know of no exclusionary rule dependent on whether it would have made any difference if natural justice had natural justice been observed. The non-observance of natural justice is itself prejudice to any man proof of prejudice independently of proof of denial of natural justice is unnecessary. It will comes from a person who has denied justice that the person who has been denied justice is not prejudiced. As we said earlier where on the admitted or indisputable facts only one conclusion is possible and under the law only one penalty is permissible, the may not issue its write to compel the observance of natural justice, not because it is not necessary to observe natural justice but because Course do not issue futile writs. We do not agree with the contrary view taken by the Delhi High in the judgement under appeal.\" ", "The observations made in S. L . Kapoor have to be understood in the context of the facts of that case and, of course, subject to the dicta of referred to hereinafter. (1973) (1) S.C.C.805),the denial of opportunity to cross- examine the material witnesses was held not to vitiate the order made. It was a case where certain male students entered a girls' hostel during the night and misbehaved with the girls. The committee appointed to enquire into the matter recorded the statements of girls in camera and used them [on the question of identity of miscreants] against the appellants without allowing them to cross-examine the girls on the ground that such a course would reveal the identity of the girls and would expose them to further indignities and also because the enquiry was held by a committee of responsible persons. ", " . (1984 (1) S.C.C.43), Sabyasachi Mukharji, J., speaking for a three- Judge Bench, considered the question whether violation of each and very facet of principles of natural justice has the effect of vitiating the enquiry. The learned Judge observed: ", "\"The basic concept is fair play in action administrative, judicial or quasi judicial. The concept of fair play in action must depend upon the particular lis, if there be any, between the parties. If the credibility of a person who has testified of given some information is in doubt, or if the version or the statement of the person who has testified, is, in dispute, right of cross- ", "examination must inevitable form part of fair play in action but where there is no lis regarding the facts but certain explanation of the circumstances there is no requirement of cross examination to be fulfilled to justify fair play in action. When on the question of facts there was no dispute, no real prejudice has been caused to a party aggrieved by an order, by absence of any formal opportunity of cross -examination per se does not invalidate or vitiate the decision arrived at fairly. This is more so when the party against whom an order has been passed does not dispute the facts and does not demand to test the veracity of the version of the credibility of the statement. The party who does not want to controvert the veracity of the evidence from or testimony gathered behind his back cannot expect to succeed in any subsequent demand that there was no opportunity of cross-examination specially when it was not asked for and there was no dispute about the veracity of the statements. Where there is no dispute as to the facts, or the weight to be attached on disputed facts but only an explanation to the acts, absence of opportunity to cross-examination does not create any prejudice in such cases. The principles of natural justice will, therefore, depend upon the facts and circumstances of each particular case. We have set out hereinbefore, the actual facts and circumstances of the case. The appellant was associated with the preliminary investigation that was conducted against him. ", "He does not deny or dispute that. Information and materials undoubtedly were gathered not in his presence but whatever information was there and gathered namely, the versions of the persons, the particular entries which required examination were shown to him. He was conveyed the information given and his explanation was asked for. He participated in that investigation. He gave his explanation but he did not dispute any of the facts nor did he ask for any opportunity to call any evidence to rebut these facts.\" ", "It was accordingly held that the enquiry held and the punishment imposed cannot be said to have been vitiated on account of an opportunity to cross-examine certain witnesses not having been afforded to him.* In Managing Director, E.C.I.L. V. B Karunkar [1993 (4) S.C.C.727], a Constitution Bench did take the view that before an employee is punished in a disciplinary enquiry, a copy of the enquiry report should be furnished to him (i.e., wherever an enquiry officer is appointed and he submits a report to ). It was held that not furnishing the report amounts to denial of natural justice. At the same time, it was held that just because it is shown that a copy of the enquiry officer's report is not furnished, the punishment ought not be set aside as a matter of course. It was directed that in such cases, a copy af the report should be furnished to the delinquent officer and his comments obtained in that behalf and that the court should interfere with the punishment order only if it is satisfied that there has been a failure of justice. The ", "------------------------------------------------------------ *The very same test is applied by a three-Judge Bench in . (1980 (3) S.C.R.179). ", "Liberty to the authority/management to proceed with the inquiry, by placing the employee under suspension and continuing the inquiry form the stage of furnishing him with the report ****** (Emphasis added) To the same effect is the decision of another Constitution Bench in . (1993 (1) S.C.C.78), a case arising under Chapter XX-C of the income Tax Act . At pages 110-111, the following observations are relevant: ", "\"This brings us to the question of relief. We find that the order of compulsory purchase under Section 269-UD(1) of the income Tax Act which was served on the petitioner in the night of December 15, 1986, has been made without any show- ", "cause notice being served on the petitioner and without the petitioner or other affected parties having been given any opportunity to show cause against an order of compulsory purchase nor were the reasons for the said order set out in the order or communicated to the petitioner or other concerned parties with the order. In view of what we have stated earlier the order is clearly bad in law and is set aside.\" ", "Even so, this Court did not set aside the order of compulsory purchase but devised an appropriate procedure so that the \"laudable object\" underlying Chapter XX-C is not defeated and at the same time the persons affected get an opportunity to put forward their case against the ", "------------------------------------------------------------ ***** The decision in (1967(2) S.C.R.625), it is obvious, has to be read subject to this decision. ", "following paragraph [applicable in cases where the order of punishment is subsequent to November 20, 1990, the date of judgment in (1991(1) S.C.C. 588 ) is apposite: ", "\"Hence, in all cases where the enquiry officer's report is not furnished to the delinquent employee in the disciplinary proceedings, the Courts and Tribunals should cause the copy of the report to be furnished to the aggrieved employee if he has not already secured it before coming to and give the employee an opportunity to show how his or her case was prejudiced because of the non-supply of the report. If after hearing the parties, comes to the conclusion that the non- supply of the report would have made no difference to the ultimate findings and the punishment given Should not interfere with the order of punishment. The Court/Tribunal should not interfere with the order of punishment should not mechanically set aside the order of punishment on the ground that the report was not furnished as is regrettably being done at present. The courts should avoid resorting to short cuts. Since it is the which will apply their judicial mind to the question and give their reasons for setting aside or not setting aside the order of punishment, (and not any internal appellate or reversional authority), there would be neither a breach of the principles of natural justice nor a denial of the reasonable opportunity. It is only if finds that the furnishing of the report would have made a difference to the result in the case that it should set aside the order of punishment. Where after following the above procedure, sets aside the order of punishment, the proper relief that should be granted is to direct reinstatement of the employee with proposed acquisition. ", "The decisions cited above make one thing clear, viz., principles of natural justice cannot be to reduced to any hard and fast formulae. As said in Russell c. Duke of Norfolk [1949 (1) All.E.R.109] way back in 1949, these principle cannot be put in a straight-jacket. Their applicability depends upon the context and the facts and circumstances of each case. [ commissioner (1978 (2) S.C.R.272)]. The objective is to ensure a fair hearing, a fair deal, to the person whose rights are going to be affected. [ 1982 (1) S.C.C.271) and (1981 (1) S.C.C.664)]. As pointed out by this Court in d India & Ors. (1969 (2) S.C.C.262), the dividing line between quasi-judicial function and administrative function [affecting the rights of a party] has become quite thin and almost indistinguishable a fact also emphasized by in C.C.C.U. v. [supra] where the principles of natural justice and a fair hearing were treated as synonymous. Whichever the Cases it is from the standpoint of fair hearing - applying the test of prejudice, as it may be called - that any and every complaint of violation of the rule of audi alteram partem should be examined. Indeed, there may be situations where observance of the requirement of prior notice/no hearing may defeat the very proceeding - which may result in grave prejudice to public interest. It is for this reason that the rule of post-decisional hearing as a sufficient compliance with natural justice was evolved in some of the cases, e.g., (1984 (3) S.C.C.465). There may also be cases where the public interest or the interests of the security of or other similar considerations may make it inadvisable to observe the rule of audi alteram partem altogether [as in the case of situations contemplated by clauses (b) and (c) of the proviso to Article 311(2)] or to disclose the material on which a particular action is being taken. There may indeed be any number of varying situations which it is not possible for anyone to foresee. In our respectful opinion, the principles emerging from the decided cases can be stated in the following terms in relation to the disciplinary orders and enquiries: a distinction ought to be made between violation of the principle of natural justice, audi alteram partem, as such and violation of a facet of the said principle. In other words, distinction is between \"no notice\"/\"no hearing\" and \"no adequate hearing\" or to put it in different words, \"no opportunity\" and \"no adequate opportunity\". To illustrate - take a case where the person is dismissed from service without hearing him altogether [as in v. ]. It would be a case falling under the first category and the order of dismissal would be invalid or void, if one chooses to use that expression [ v.]. But where the person is dismissed from service, say, without supplying him a copy of the enquiry officer's report [ ] or without affording him a due opportunity of cross-examining a witness [K.L.Tripathi] it would be a case falling in the latter category - violation of a facet of the said rule of natural justice - in which case, the validity of the order has to be tested on the touch-stone of prejudice, i.e., whether, all in all, the person concerned did nor did not have a fair hearing. It would not be correct - in the light of The above decisions to say that for any and every violation of a facet of natural justice or of a rule incorporating such facet, the order passed is altogether void and ought to be set aside without further enquiry. In our opinion, the approach and test adopted in B.Karunkar should govern all cases where the complaint is not that there was no hearing [no notice, no opportunity and no hearing] but one of not affording a proper hearing [i.e., adequate or a full hearing] or of violation of a procedural rule or requirement governing the enquiry; the complaint should be examined on the touch-stone of prejudice as aforesaid. ", "The matter can be looked at from the angle of justice or of natural justice also. The object of the principles of natural justice - which are now understood as synonymous with the obligation to provide a fair hearing***** - is to ensure that justice is done, that there is no failure of justice and that every person whose rights are going to be affected by the proposed action gets a fair hearing. The said objective can be tested with reference to sub-clause ", "(iii) concerned herein. It says that copies of statements of witnesses should be furnished to the delinquent officer \"not later than three days before the commencement of the examination of the witnesses by \". Now take a case - not the one before us where the copies of statements are supplied only two ", "------------------------------------------------------------ *****See the discussion of this aspect at Page 515 of Wade: Administrative Law (Seventh Edition). In particular, he refers to the speech of Lord in C.C.S.U. v. Minister for the Civil Service [ 1985 A.C.374 at 407] where he used both these concepts as signifying the same thing. days before the commencement of examination of witnesses instead of three days. The delinquent officer does not object; he does not say that two days are not sufficient for him to prepare himself for cross-examining the witnesses. The enquiry is concluded and he is punished. Is the entire enquiry and the punishment awarded to be set aside on the only ground that instead of three days before, the statements were supplied only two days before the commencement of the examination of witnesses? It is suggested by that sub-clause (iii) is mandatory since it uses the expression \"shall\". Merely because, word \"shall\" is used, it is not possible to agree that it is mandatory. We shall, however, assume it to be so for the purpose of this discussion. But then even a mandatory requirement can be waived by the person concerned if such mandatory provision is his interest a & not in public interest, vide . (1964 (6) S.C.R.1001). J., speaking for the , held: ", "\"Where the court acts without inherent jurisdiction, a party affected cannot by waiver confer jurisdiction on it, which it has not. Where such jurisdiction is not wanting, a directory provision can obviously be waived. But a mandatory provision can obviously be waived. But a mandatory provision can only be waived if it is not conceived in the public interests, but in the interests of the party that waives it. In the present case the executing court had inherent jurisdiction to sell the property. We have assumed that s.35 of the Act is a mandatory provision. If so, the question is whether the said provision is conceived in the interests of the public or in the interests of the person affected by the non- observance of the provision. lt is true that many provisions of the Act were conceived in the interests of the public, but the same cannot be said of s.35 of the Act, which is really intended to protect the interests of a judgment-debtor and to see that a larger extent of his property than is necessary to discharge the debt is not sold. Many situations may be visualized when the judgment-debtor does not seek to take advantage of the benefit conferred on him under s.35 of the Act.\" ", "The principle of the above decision was applied by this Court in Krishan Lal State of Jammu & Kashmir [1994 (4) S.C.C.422) in the case of an express statutory provision governing a disciplinary enquiry. It was a case where the employee was dismissed without supplying him a copy of the enquiry officer's report as required by Section 17(5) of the Jammu and Kashmir (Government Servants) Prevention of Corruption Act, 1962. This was treated as mandatory. The question was how should the said complaint be dealt with. This Court held: ", "\"Let it now be seen whether the requirement of giving copy of the proceeding of the inquiry mandated by Section 17(5) of the Act is one which is for the benefit of the individual concerned or serves a public purpose. If it be former, it is apparent, in view of the aforesaid legal position, that the same can be waived; if it be latter, it cannot be. Though has urged that this requirement serves a public purpose, we do not agree. According to us, the requirement is for the benefit of the person concerned which is to enable him to know as to what had taken place during the cause of the proceedings so that he is better situated to show his cause as to why the proposed penalty should not be imposed. Such a requirement cannot be said to be relatable to public policy or one concerned with public interest, or to serve a public purpose. ", "We, therefore, hold that the requirement mentioned in Section 17(5) of the Act despite being mandatory is one which can be waived. If, however, the requirement has not been waived any act or action in violation of the same would be a nullity. In the present case as the appellant had far from waiving the benefit, asked for the copy of the proceeding despite which the same was not made available, it has to be held that the order of dismissal was invalid in law. ", "The aforesaid, however, is not sufficient to demand setting aside of the dismissal order in this proceeding itself because what has been stated in ECIL case [1993 (4) SCC 727] in this context would nonetheless apply. This is for the reason that violation of natural justice which was dealt with in that case, also renders an order invalid despite which did not concede that the order of dismissal passed without furnishing copy of the inquiry officer's report would be enough to set aside the order. Instead, it directed the matter to be examined as stated in paragraph ", "31........ ", "According to us, therefore, the legal and proper order to be passed in the present case also, despite a mandatory provision having been violated, is to require the employer to furnish a copy of the proceeding and to call upon to decide thereafter as to whether non-furnishing of the copy prejudiced the appellant/petitioner and the same has made difference to the ultimate finding and punishment given. If this question would be answered in affirmative, would set aside the dismissal order by granting such consequential reliefs as deemed just and proper.\" ", "Sub-clause (iii) is, without a doubt, conceived in the interest of the delinquent officer and hence, The could waive it. From his conduct, the respondent must be deemed to have waived it. This is an aspect which must be borne in mind while examining a complaint of non-observance of procedural rules governing such enquiries. It is trite to remember that, af a rule, all such procedure; rules are designed to afford a full and proper opportunity to the delinquent officer/employee to defend himself and are, therefore, conceived in his interest. Hence, whether mandatory or directory, they would normally be conceived in his interest only. ", "Now, coming back to the illustration given by us in the preceding paragraph, would setting aside the punishment and the entire enquiry on the ground of aforesaid violation of sub-clause (iii) be in the interests of justice or would it be its negation? In our respectful opinion, it would be the latter. Justice means justice between both the parties. The interests of justice equally demand that the guilty should be punished and that technicalities and irregularities which do not occasion failure of justice are not allowed to defeat the ends of justice. Principles of natural justice are but the means to achieve the ends of justice. They cannot be perverted to achieve the very opposite end. That would be a counter-productive exercise. ", "We may summarise the principles emerging from the above discussion. [These are by no means intended to be exhaustive and are evolved keeping in view the context of disciplinary enquiries and orders of punishment imposed by an employer upon the employee]: ", "(1) An order passed imposing a punishment on an employee consequent upon a disciplinary/departmental enquiry in violation of the rules/regulations/statutory provisions governing such enquiries should not be set aside automatically. The or the should enquire whether (a) the provision violated is of a substantive nature or (b) whether it is procedural in character. (2) A substantive provision has normally to be complied with as explained hereinbefore and the theory of substantial compliance or the test of prejudice would not be applicable in such a case. ", "(3) In the case of violation of a procedural provision, the position is this: procedural provisions are generally meant for affording a reasonable and adequate opportunity to the delinquent officer/employee. They are, generally speaking, conceived in his interest. Violation of any and every procedural provision cannot be said to automatically vitiate the enquiry held or order passed. Except cases falling under 'no notice', 'no opportunity' and 'no hearing' categories, the complaint of violation of procedural provision should be examined from the point of view of prejudice, viz., whether such violation has prejudiced the delinquent officer/employee in defending himself properly and effectively. If it is found that he has been so prejudiced, appropriate orders have to be made to repair and remedy the prejudicate, including setting aside the enquiry and/or the order of punishment. If no prejudice is established to have resulted therefrom, it is obvious, no interference is called for. In this connection, it may be remembered that there may be certain procedural provisions which are of a fundamental character, whose violation is by itself proof of The may not insist on proof of prejudice in such cases. As explained in the body of the judgment, take a case where there is a provision g expressly providing that after the evidence of the employer/government is over, the employee shall be given an opportunity to lead defence in his evidence, and in a given case, the enquiry officer does not give that opportunity inspite of the delinquent officer/employee asking for it. The prejudice is self- evident. No proof of prejudice as such need be called for in such a case. To repeat, the test is one of prejudice, i.e., whether the person has received a fair hearing considering all things. Now, this very aspect can also be looked at from the point of view of directory and mandatory provisions, if one is so inclined. The principle stated under (4) hereinbelow is only another way of looking at the same aspect as is dealt with herein and not a different or distinct principle. ", "(4)(a) In the case of a procedural provision which is not of a mandatory characters the complaint of violation has to be examined from the standpoint of substantial compliance. Be that as it mays the order passed in violation of such a provision can be set aside only where such violation has occasioned prejudice to the delinquent employee. ", "(b) In the case of violation of a procedural provisional which is of a mandatory character, it has to be ascertained whether the provision is conceived in the interest of the person proceeded against or in public interest. If it is found to be the former, then it must be seen whether the delinquent officer has waived the said requirements either expressly or by his conduct. If he is found to have waived its then the order of punishment cannot be set aside on theground of said violation. If, on the other hand, it is found that the delinquent officer/employee has not it or that the provision could no be waived by him, then the or should make appropriate directions [include the setting aside of the order of punishment], keeping in mind the approach adopted by in B.Karunkar. The ultimate test is always the same viz., test of prejudice or the test of fair hearing, as it may be called. ", "(5) Where the enquiry is not governed by any rules/regulations/statutory provisions and the only obligation is to observe the principles of natural justice - or, for that matter, wherever such principles are held to be implied by the very nature and impact of the order/action the or the should make a distinction between a total violation of natural justice [rule of audi alteram] and violation of a facet of the said rule, as explained in the body of the judgment. In other words, a distinction must be made between no opportunity\" and no adequate opportunity, i.e., between \"no notice\"/\"no hearing\" \"no fair hearing\". ", "(a) In the case of former, the order passed would undoubtedly be invalid [one may call it \"void\" or a nullity if one chooses to]. In such cases, normally, liberty will be reserved for the to take proceedings afresh according to law, i.e., in accordance with the said rule [audi alteram partem ]. (b) But in the latter case, the effect of violation [of a facet of the rule of audi alteram] has to be examined from the standpoint of prejudice; in other word in other words, what the or Tribunal has to see is whether in the totality of the circumstances, the delinquent officer/employee did or did not have a fair hearing and the orders to be made shall depend upon the answer to the said query. [It is made clear that this principle [No.5] does not apply in the case of rule against bias, the test in which behalf are laid down elsewhere.] (6) While applying the rule of audi alteram partem [the primary principle of natural justice] the / Tribunal/ must always bear in mind the ultimate and over-riding objective underlying the said rule, viz., to ensure a fair hearing and to ensure that there is no failure of justice. It is this objective which should guide them in applying the rule to varying situations that arise before them. ", "(7) There may be situations where the interests of state or public interest may call for a curtailing of the rule of audi alteram partem. . In such situations, the may have to balance public/State interest with the requirement of natural justice and arrive at an appropriate decision. ", "Now, in which of the above principles does the violation of sub-clause (iii) concerned herein fall? In our opinion, it falls under Principles No.3 and 4(a) mentioned above. Though the copies of the statements of two witnesses [, and ] were not furnished, the respondent was permitted to peruse them and take notes therefrom more than three days prior to their examination. Of the two witnesses, was not examined and only was examined. The respondent did not raise any objection during the enquiry that the non-furnishing of the copies of the statements is disabling him or has disabled him, as the case may be, from effectively cross- examining the witnesses or to defend himself. has not found that any prejudice has resulted from the said violation. has no doubt said that it has prejudiced the respondent's case but except merely mentioning the same, it has not specified in what manner and in what sense was the respondent prejudiced in his defence. , of course, has not refereed to aspect of prejudice at all. ", "For the above reasons, we hold that no prejudice has resulted to the respondent on account of not furnishing him the copies of the statements of witnesses. We are satisfied that on account of the said violations it cannot he said that the respondent did not have a fair hearing or that the disciplinary enquiry against him was not a fair enquiry. Accordingly, we allow the appeal and set aside the judgment of affirming the judgments of and . the suit filed by the respondent shall stand dismissed. ", "No costs."], "relevant_candidates": ["0000427915", "0000447308", "0000514007", "0000549062", "0000639803", "0000727248", "0000740171", "0000859161", "0000875590", "0000880174", "0001246653", "0001306907", "0001327659", "0001384612", "0001455346", "0001493098", "0001590667", "0001831036", "0098853113"]} {"id": "0001879785", "text": ["PETITIONER: Vs. RESPONDENT: THE STATE OF ORISSA. DATE OF JUDGMENT: 07/04/1954 BENCH: , VIVIAN BENCH: , VIVIAN MAHAJAN, (CJ) , CITATION: 1954 AIR 359 1955 SCR 92 CITATOR INFO : A 1955 SC 41 (11) R 1959 SC 707 (5) R 1961 SC1381 (10) F 1977 SC 786 (9,12,14) ACT: Prevention of Corruption Act , 1947 (II of 1947) Section 5(1)(2) ,(3) and section 6- - sanction under section 6 --Whether necessary to be in any particular form-No particulars given in the charge or sanction-Legal effect thereof. HEADNOTE: Held, that it is not necessary for the sanction for an offence punishable under section 5(2) of the Prevention of Corruption Act, 1947 (Act II of 1947) to be in any Particular form or in writing or for it to set out the facts in respect of which it is given. It is, however, desirable to state the facts on the face of sanction, because when the facts are not set out in the sanction, proof has to be given aliunde that sanction was given in respect of the facts constituting the offence charged but an omission to set out the facts in the sanction is not fatal so long as the facts can be and are proved in some other way. Where the sanction was confined to section 5(2) of the Act, it could not, under the circumstances of the case, have related to anything but clause (a) of sub-section (1) of section 5 and therefore an omission to mention clause (a) in the sanction did not invalidate it. under section 5(3) of the Act all that the prosecution has to do is to show that the accused or some person on his behalf is in possession of pecuniary resources or property disproportionate to his known sources of income and for which the accused cannot satisfactorily account. Once that is established then the is bound to presume unless the contrary is proved, that the accused is guilty of the new offence created by section 5 namely criminal misconduct in the discharge of his official duty. Held, also that there was no illegality either in the sanction or in the charge on the ground that no particulars were given because the offence under section 5(1)(a) of the Prevention of Corruption Act does not consist of individual acts of bribe taking as in section 161 I.P. C. but is of a general character and individual instances are not necessary because of the presumption which section 5(3) requires the to draw. (A.I.R. 1948 P.C. 82) referred to. JUDGMENT: ", "CRlMlNAL APPELLATE JURISDICTION: Criminal Appeal No. 33 of 1952. ", "Appeal under Article 134(1)(c) from the Judgment and Order dated the 19th February, 1952, of at Cuttack in Criminal Appeal No. 66 of 1950 arising out of the Judgment and Order dated the 19th September, 1950, of , Cuttack-Dhenkanal, Cuttack, in Sessions Trial No. 9-C of 1950. ", ", and , for the appellant. ", ", for the respondent. ", "1954. April 7. The Judgment of the Court was delivered by -The appellant was an Inspector of Factories under the Government of Orissa. 'It was a part of his duty to inspect factories and mills in the State of Orissa. He toured the districts of Koraput and Balasore from 18th August, 1948, to 27th August, 1948, and from 29th September, 1948, to 30th October, 1948, respectively. The prosecution case is that he collected bribes from persons connected with some of the mills he inspected in those districts. It is said that he used to threaten to close their mills and impose other penalties for alleged defects unless they paid him a bribe. ", "On 3rd October, 1948, he was camping at the Dak Bungalow at Basta in the Balasore district. Because of information received against him his person and belongings were searched on that day and a sum of Rs. 3,148 was recovered from him consisting of Rs. 450 paid at the time as a trap and Rs. 2,698 already in his possession. He was arrested on the spot but was later released on bail. ", "Departmental and other proceedings were taken against him and he was eventually brought to trial on 29th March, 1950, and charged under section 5(2) of the Prevention of Corruption Act (II of 1947) for criminal misconduct in the shape of habitually accepting illegal gratification. He was also separately charged and separately prosecuted under section 161 of the Indian Penal Code for three specific offences of bribe taking but we are not concerned here with that as he was acquitted on all three counts. His, conviction here is under section 5(2) alone. sentenced him to rigorous imprisonment for four years and a fine of Rs. 5,000. upheld the conviction on appeal but reduced the sentence to two years and a fine of Rs. 3,000. ", "The accused applied for a certificate to appeal under article 134(1)(c) on three points. held that two of them were not of sufficient importance to justify the issue of a certificate-particullarly as one of the two was covered by the principle laid down by this Court. But it granted leave on all three as it considered that the first point was of importance. The points were formulated as follows: ", "\"(i) whether the view of this Court as to the requirement of sanction in a case of this kind and the interpretation of 's case in A.I.R. 1948 P.C. p. 82 adopted by this Court in its judgment are correct; ", "(ii)whether the interpretation of this Court relating to the requirements as to the corroboration of an accomplice witness in a bribery case with reference to the latest unreported case of which has been referred to in the judgment and which has since been reported in 1952 S.C.J. p. 46 is correct; ", "and ", "(iii)whether the law as propounded by the decision now' sought to be appealed against with reference to the considerations that arise in judging the presumptions under section 5(3) of the Prevention of Corruption Act is correct.\" ", "The first point arises in this way. Four kinds of criminal misconduct are set out in section 5 of the Prevention of Corruption Act. They are enumerated in clauses (a), (b), ", "(c) and (d) of sub-section (1). The sanction is general and does not specify which of these four offences was, meant. It runs as follows: ", "\" Government of Orissa. ", ". ", "Order No. 4561/Com., dated 3-11-1948. ", "In pursuance of section 6 of the Prevention of Corruption Act, 1947 (II of 1947), the Governor of Orissa is hereby pleased to accord sanction for prosecution of , Inspector of Orissa, employed in connection with the affairs of the Province under sub-section (2) of section 5 of the said Act. ", "2. Nature of offence committed: ", "Criminal misconduct in discharge of official duty. ", "By order of the governor, , Secretary to . It was contended that held in (1) that such a sanction is invalid. rejected this argument. We agree with . ", "The passage of the judgment on which reliance is placed is as follows \"In their Lordships' view, in order to comply with the provisions of clause 23 it must be proved that the sanction was given in respect of the facts constituting the offence charged. It is plainly desirable that the facts should be' referred to on th; face of the sanction but this is not essential since clause 23 does not require the sanction to be in an particular form nor even to be in writing. But if the facts constituting the offence charged are not known on the face of the sanction, the prosecution must prove by extraneous evidence that those facts were placed before the sanctioning authority.\" ", "The Judgment of the Judicial Committee relates to clause 23 of the Cotton Cloth and Yarn (Control). Order, 1943, but the principles apply here. It is no more necessary for the sanction under the Prevention of Corruption Act to be in any particular form, or in writing or for it to set out the facts in respect of which it is given than it was under clause 23 of the Order which their Lordships were considering. The desirability of such a course is obvious because when the facts are not set out in the sanction proof has to be given (1) A.I.R. 1948 P.C. 82. ", "96 ", "aliunde that sanction was given in respect of the facts constituting the offence charged, but an omission to do so is not fatal so long as the facts can be, and are, proved in some other way. ", " finds that the facts to which the sanction relates were duly placed before the proper sanctioning authority. We need not consider the evidence about telephone calls and the like because the letter of the District Magistrate asking for sanction (Exhibit 26) is enough to show the facts on which the sanction is based. 'It is in these terms: ", "\"I have the honour to report that , Inspector of Factories, Orissa, in the course of his visit to this district had been -visiting certain mills, and on information received by me that he had been collecting heavy sums as illegal gratification from the Manager or Proprietor of Mills under threat of mischief to the mill owners, it was arranged to verify the truth of this information by handing over 3 hundred rupee notes marked with my initials in presence of the Superintendent of Police and two other respectable gentlemen and millowners, on the evening of the 2nd October, 1948. On the 3rd October the Factory Inspector having actually received the illegal gratification of Rs. 45o which sum included the three marked hundred rupee notes, the Prosecuting Inspector seized the marked notes along with a further heavy sum of Rs. 2,698 from his possession. Under section 6 of the Prevention of Corruption Act, 1947, the accused being a public servant in the employ of the sanction of is necessary prior to taking cognisance of an offence under section 161 , Indian Penal Code or subsection (2) of section 5 of the Act.\" ", "A sanction based on the facts set out in this letter,. namely the information received about the collection of heavy sums as bribes and the finding of Rs. 2,698 in his possession would be sufficient to validate the present prosecution. It is evident from this letter and from the other evidence that the facts placed before the Government could only relate to offences under section 161 of the Indian Penal Code and clause (a) of section 5(1) of the Prevention of Corruption Act. They could not relate to clauses (b) or (c). Therefore, when the sanction was confined to section 5 (2) it could not, in the circumstances of the case, have related to anything but clause (a) of sub- section (1) of section 5 . Therefore, the omission to mention clause (a) in the sanction does not invalidate it. The present prosecution is confined to section 5(1)(a) which runs as follows: ", "\"(1) A public servant is said to commit the offence of criminal misconduct in the discharge of his duty(a) if he habitually accepts or obtains or agrees to accept or attempts to obtain from any person for himself or for any other person, any gratification (other than legal remuneration) as a motive or reward such as is mentioned in section 161 of the Indian Penal Code.\" ", "Then comes sub-section (3) which sets out a new rule of evidence in these terms: ", "\"In any trial of an offence punishable under subsection (2) the fact that the accused person or any other person on his behalf is in possession, for which the accused person cannot satisfactorily account, of pecuniary resources or property disproportionate to his known sources of income may be proved, and on such proof the shall presume, unless the contrary is proved, that the accused person is guilty of criminal misconduct in the discharge of his official duty and his conviction therefor shall not be invalid by reason only that it is based solely on such presumption.\" Therefore, all that the prosecution has to do is to show that the accused, or some person on his behalf, is in possession of pecuniary resources or property disproportionate to his known sources of income and for which the accused cannot satisfactorily account. Once that is established then the has to presume, unless the contrary is proved, that the accused is guilty of the new offence created by section 5 , namely criminal misconduct in the discharge of his official duty. ", "13 ", "98 ", "Now the accused was found in possession of Rs. 3,148. He accounted for Rs. 450 of that sum by showing that it was paid to him at the time as a trap. He has been acquitted of that offence, so all he had to account for was the balance Rs. 2,698. This is a large sum for a touring officer to carry with him in cash while on tour. His explanation was not considered satisfactory and that is a question of fact with which we are not concerned in this Court. Therefore, all that remains to be seen is whether this was disproportionate to his known sources of income. The accused is a Government Factory Inspector and we were told that his salary is only Rs. 450 a month. finds that the total sums drawn by him during his entire period of service of thirteen months was Rs. 6,045 as salary and Rs. 2,155 as travelling allowance. It also finds that he owns 0.648 acres of land which brings in no income worth the name. On the expenditure side of the accused's account finds that he has a substantial family establishment which would not leave him enough margin for saving such a large sum of money. No other source of income has been disclosed. It is evident that no touring officer of his status and in his position would require such a large sum of money for his touring purposes even if he was away from headquarters for a month. His explanation was considered unsatisfactory by both Courts and was disbelieved. These are all questions of fact. Once the facts set out above were found to exist and the explanation of the accused rejected as unsatisfactory, section 5(3) was at once attracted and the Court was bound to presume (the word used in the section is \"shall\" and not \"may\") that the accused was guilty under section 5(2) , especially as this part of the section goes on to say- ", "\"and his conviction therefor shall not be invalid by reason only that it is based solely on such presumption.\" These facts alone are enough to sustain the conviction and we need not consider the other matters. was right in holding that the sanction was sufficient and in convicting the accused. ", "99 ", "The third point set out in the certificate of relates to the absence of particulars in the charge and, we gathered from the arguments, in the sanction. But no particulars need be set out in the charge in such a case because the offence under section 5(1)(a) does not consist of individual acts of bribe taking as in section 161 of the Indian Penal Code but is of a general character. Individual instances may be useful to prove the general averment in particular cases but it is by no means necessary because of the presumption which section 5(3) requires the to draw. There was therefore no illegality either in the sanction or in the charge; nor has the accused been prejudiced because he knew everything that was being urged against him and led evidence to refute the facts on which the prosecution relied. He was also questioned about the material facts set out above in his examination under section 342 of the Criminal Procedure Code and was given a chance then as well to give such explanation as he wished. The appeal fails and is dismissed. ", "Appeal dismissed."], "relevant_candidates": ["0001841408"]} {"id": "0001881515", "text": ["JUDGMENT , J. ", "1. This is an application to revise an order made by the learned District of Tenali by which he -allowed a petition presented on behalf of the second respondent here that she may also be impleaded as a party to a suit O.S. No. 66 of 1935. The application was presented under Order 1, Rule 10 of the Code of Civil Procedure. The relevant portion of the rule is worded as follows: ", "The may at any stage of the proceedings, either upon or without the application of either party, and on such terms as may appear to the to be just, order... that the name of any person who ought to have been joined, whether as plaintiff or defendant, or whose presence before the may be necessary in order to enable the effectually, and completely to adjudicate upon and settle all the questions involved in the suit, be added. ", "2. It is obvious from this provision that the in making an order directing a new party to be added must be satisfied either that that party ought to have been joined as plaintiff or defendant or that the presence of that party is necessary to enable the effectually and completely to adjudicate upon and settle all the questions involved in the suit. From the order of the learned District Munsif it appears that at the hearing of the application, the for the plaintiffs was absent and only the first plaintiff was present in person to represent his objections. The learned District Munsif says that the first plaintiff was unable to explain what detriment would be suffered by him if the petition was granted. Then he says that he sees no detriment that would be caused to the plaintiff if the second respondent here were brought on record as the second defendant. He also says that he does not see how it widens the scope of the suit or changes the character of it. From these statements contained in the order it is clear that the learned District Munsif did not apply his mind to the essential requisites prescribed by Order 1, Rule 10 and therefore it became necessary for the learned Advocates for the parties to address lengthy arguments before me in support of their respective contentions. ", "3. The suit was filed by three plaintiffs and the main reliefs asked for in the plaint were the following: ", "(1) to declare the plaintiffs' hereditary right to perform archaka service in situated in the village of Nidubrolu; ", "(2) to remove the defendant from the position of archaka and to declare that the defendant has absolutely no right to the archaka service; ", "(3) to remove the defendant from possession of the house mentioned as item 2 in the schedule to the plaint and to put the plaintiffs in possession thereof; ", "(4) to direct the defendant to give the plaintiffs the property mentioned in item 3 of the schedule to the plaint or its value; and (5) to grant a permanent injunction restraining the defendant from interfering in future with the plaintiffs' enjoyment of the rights to perform archaka service. ", "4. The following geneological table is necessary to understand the plaintiffs' case as disclosed in the plaint. ", " - died in 1921. (died) 1st plaintiff. | | Daughter (died). | __________________________________________________________ | | | Daughter Daughter- Daughter petitioner (died). 3rd plaintiff before married 2nd who has been directed plaintiff by to be impleaded as 2nd defendant. ", "5. The plaint allegations are to the effect that the hereditary right to the archaka service in the temple was vested in the ancestors of and who were both the brothers of the first plaintiff that these two brothers are now dead but that during their lifetime they were both of them performing the archaka service personally each of them doing duty alternately for six months at a time in the year and that as remuneration for such service they were enjoying separately in 'two shares the archaka service inam lands. The first plaintiff's case according to the plaint is that on the death of his right to enjoy the one-half of the archaka service inam lands and his right to perform archaka service for a period of six months in the year devolved on the first plaintiff. The case of the second and third plaintiffs according to the plaint is that on the death of whose daughter the third plaintiff is, the corresponding rights which vested in devolved on the third plaintiff and her husband the second plaintiff. How the third plaintiff's husband, the second plaintiff became entitled to this right is not explained in the plaint. The plaint goes on to say that the second plaintiff's father was in actual management of the right mentioned above on behalf of the plaintiffs and while he was in such management he had appointed the defendant as a temporary clerk for performing the archaka service and had put him in possession of the house mentioned in Schedule B to the plaint on the distinct understanding that he should relinquish archaka service and deliver possession of the house whenever he was called upon to do so. Subsequently an arrangement was made between the first plaintiff ;on the one hand and the second and third plaintiffs on the other according to which the latter were to perform the archaka service alternately for six months at a time in the year and the first period of the six months ended on the 30th of June, 1933. Thereupon the first plaintiff caused the second and third plaintiffs to send a registered notice to the defendant informing him that the first plaintiff's right to perform the service for six months commenced on the 1st of July, 1933 and that since the plaintiffs had decided to perform the service themselves the defendant should relinquish such service and deliver possession of the house and other perquisites that were given to him during the time that he was called upon to perform such service. To that notice the defendant replied stating that he was appointed archaka not on behalf of the plaintiffs but by the trustees of the temple appointed under . ", "6. The first defendant in his written statement alleged inter alia that the first plaintiff was not entitled to any relief in respect of the temple because he had been given away in adoption to another family as a result of which he had lost all his rights in his natural family and that on the death of , his rights devolved on his two daughters, namely, the third plaintiff and her sister the respondent who has now on her application been directed by the Court below to be impleaded as second defendant. Thus the first defendant's version was that neither the first plaintiff nor the second plaintiff had any interest whatsoever in the archaka service or in the service inam lands but that the right involved in the suit was vested in the third plaintiff and her sister, the second respondent to this application. The first defendant also asked in his written statement for further particulars as to how the right that was vested in devolved upon the third plaintiff and her husband the second plaintiff and stated that on such particulars being furnished he would plead further. It was after this written statement was filed that the second respondent who as already stated is the sister of the third plaintiff came forward with her application to be impleaded as a party to the suit. Her version in the petition filed by her was that during the minority of herself and the third plaintiff their uncle who is also the father-in-law of the third plaintiff was invested with the right of managing the temple and the service inam lands and also performing the archaka service on behalf of the two sisters. Her case therefore was that she was entitled to one-half of the suit properties, that she had an equal joint interest with the third plaintiff in the suit property and that consequently she was a necessary party to the suit. This application was resisted before on behalf of the three plaintiffs who contended that in case the petition was allowed and the respondent was impleaded as a party, it would lead to a triangular fight about title and that the effect of including her as a party would be to convert the suit which was one in ejectment into a suit based on title. They also pleaded that the right of the present respondent if any to the temple lands had become barred by limitation. These are the main contentions that are urged before me on behalf of the petitioners by their learned Advocate Mr. . He relies on the English decisions reported in v. (1892) 1 Ch. 487 and also on the decision of a single Judge of this Court reported in for Hindu Religious Endowments, Madras (1926) 51 M.L.J. 148 : I.L.R. 50 Mad. 34. There are other reported cases relied on by him in support of his contention that the second respondent should not have been impleaded as a party to the suit and those are the decisions reported in (1934) 68 M.L.J. 236, (1938) 41 Bom. L.R. 249 at 256, A.I.R. 1929 Mad. 443 and v. Alt Miahe (1923) 28 C.W.N. 805. ", "7. The learned Advocate for the respondent on the other hand contends that the subject-matter of the suit concerns the newly added party and that the suit is not a simple suit in ejectment but that it is a suit for a declaration that the three plaintiffs are solely entitled to a hereditary right to perform archaka service in the temple and to enjoy the service inam lands. He contends that as a joint interest in those rights is claimed by the second respondent her presence as a party to the suit is necessary to avoid multiplicity of suits. In support of his contentions he relies mainly upon the decision in (1881) I.L.R. 5 Mad. 52 which has been followed by , J., in the decision reported in A.I.R. 1929 Mad. 443. He also relies upon the decision in Montgomery v. Foy, Morgan and Co. (1895) 2 Q.B. 321, A.I.R. 1935 Mad. 353, (1937) 1 M.L.J. 597 and A.I.R. 1929 Mad. 403 (1). I am satisfied that the contentions of the learned Advocate for the respondents are well founded in view of the main relief asked for by the three plaintiffs in their plaint. This, in my view, is a case in which the presence of the second defendant-respondent before is necessary within the meaning of Order 1, Rule 10 of the Civil Procedure Code to enable the effectually and completely to adjudicate upon and settle all the questions involved in the suit. By avoiding to implead her as a party to the suit the plaintiffs are seeking to obtain a relief which will not completely dispose of all the matters in controversy involved in the suit. ", "8. The learned Judges who decided the case reported in (1881) I.L.R. 5 Mad. 52 were Sir Charles Turner, C.J. and , J. The decision turned on the scope of Section 32 of the Code of Civil Procedure of 1877. Under that section also the Court had the power of directing a person to be made a party: ", "Whose presence before the may be necessary to enable the effectually and completely to adjudicate upon and settle all the questions involved in the suit. ", "9. These are the words that occur in Order 1, Rule 10(2) of the present Code also. Dealing with these words the learned Judges say as follows: ", "Is it meant by these words that a person not originally impleaded is to be made a party only if the questions raised in the suit cannot otherwise be completely and effectually determined between the parties to the suit? or is it meant completely and effectually determined so that they shall not be again raised in that or in any other suit between the parties to the suit or any of them and third parties? To accept the more restricted interpretation involves the addition of words which we do not find in the section, namely, 'between the parties to the suit.... ", "10. This seems to me to be a complete and effective answer to a similar argument addressed in the present case by the learned Advocate for the petitioner. Following the decisions reported in (1881) I.L.R. 5 Mad. 52 and A.I.R. 1929 Mad. 443, I therefore hold that the learned District Munsif acted correctly in allowing the petition of the second respondent to be impleaded as a party to the suit. This Civil Revision Petition is in the circumstances dismissed wiih costs. The order staying the trial before the Court below is cancelled."], "relevant_candidates": ["0000142305", "0000476231", "0000701461", "0001216058", "0001266526", "0001705748", "0001846280"]} {"id": "0001884070", "text": [", C.J. ", "1. In 1882 the 1st defendant executed a mortgage, Exhibit A, of the suit properties in favour of one , who transferred it on 15th August 1892 by Exhibit B to the father of the 1st plaintiff, whose son, the 1st plaintiff, was married to the 1st defendant's daughter. On 13th February 1893, the plaintiff's father obtained a lease, Exhibit E, of the suit properties from the 1st defendant at a rent of Rs. 300, which would appear to have been an undervalue. On 9th February 1897 the 1st defendant executed a fresh mortgage, Exhibit F, in favour of the 1st plaintiff's father for the amount found due on the mortgage Exhibit A. Subsequently in December 1899, the 1st defendant's equity of redemption was sold in execution by a decree-holder (see Exhibit K) and except as regards 9-5/8 f-awnies was purchased at the Court sale for Rs. 182 by one , who a few days later by Exhibit 3 transferred the interest he had acquired to the 1st plaintiff for the same sum of Rs. 182. Between four and five years later, the 1st plaintiff re-conveyed the suit properties except the 9-5/8 cawnies to the 1st defendant for Rs. 185. The document reads at first sight like an out-and-out sale but beneath the signature of the vendor and his witnesses there is a further statement signed by the 1st plaintiff alone, to the effect that the sale was subject to two mortgages one of which was the suit mortgage. In 1910 the 1st plaintiff and his sons instituted the present suit on the mortgage so reserved and obtained a decree and one of the main contentions raised by the present appellants, who represent subsequent alienees from the 1st defendant, is that the suit mortgage was extinguished when under Exhibit 3 the 1st defendant's equity of redemption in the suit properties was acquired by the 1st plaintiff. This acquisition must be considered to have been made on behalf of his joint family, which included a younger brother since deceased and the 1st plaintiff's sons who are co-plaintiffs with him in this case, and it was treated as joint family property in Exhibits 10 and 11. It may, therefore, be said that by Exhibit 3 the mortgagees acquired the equity of redemption except as regards 9-5/8 cawnies. The owners of these items are not parties to the present suit and though the items acquired by them may be liable for their proportionate share of the mortgage-debt, that does not appear to affect the question whether there has been a merger as regards the items of the mortgaged properties which have been acquired by the mortgagees. ", "2. This question of merger has recently been considered by in v. (1914) A.C. 132 : 83 L.J. Ch. 349 : 110 L.T. 434 : 58 S.J. 218 and by in 16 Ind. Cas. 210 : 40 C. 89 : 16 C.W.N. 985 : 23 M.L.J. 311 : 12 M.L.T. 352 : (1912) M.W.N. 944 : 14 Bom. L.R. 1046 : 16 C.L.J. 606. As pointed out in the former case by the Lord Chancellor, where the mortgagor himself has purchased the interest of the 1st mortgagee he cannot derogate from his own bargain by setting up the mortgage so purchased against the 2nd mortgage created by himself: v. Lord Vault 2 K. and J. 650 affirmed 6 Dec. M. and G. 638 : 26 L.J. Ch. 128 : 3 Jur. (N.S.) 169 : 5 W.R. 188 : 69 K.R. 943 : 106 R.R. 235. Next there is the case of a third party purchasing the mortgaged property and paying off a prior mortgage out of the purchase-money as in v. 3 Mer. 210 : 17 R.R. 67 : 36 E.R. 81. have held that decision to be inapplicable to India in v. 11 T.A. 126 : 10 C. 1035 : 8 Ind. Jur. 396 : 4 Sar. P.C.J. 543 and the Lord Chancellor in the case just cited, whilst refraining from expressing any opinion as to whether or not it was correctly decided, observed that it amounted to no more than this that in such circumstances the presumption was that the purchaser did not intend to keep the mortgage alive. So that even here the question was treated as one of the intention of the purchaser. Lastly we have cases like the present where it is an encumbrancer who acquires the equity of redemption see v. 34 Beav. 645 : 11 Jur. (N.S.) 836 : 13 L.T. 56 : 13 W.R. 1010 : 55 E.R. 784 : 145 R.R. 717 and to these cases Section 101 Transfer of Property Act, expressly applies. The section is as follows: Where the owner of a charge or other inoumbrance on immoveable property is or becomes absolutely entitled to that property, the charge or incurnbrance shall be extinguished, unless lie declares, by express words or necessary implication, that it shall continue to subsist or such continuance would be for his benefit\". The word \"absolutely\" cannot mean that there are no mesne incunibrances outstanding, as the very object of the exception to the section is to protect the prior mortgagee against such incumbrances. When, as in the recent cases of 16 Ind. Cas. 210 : 40 C. 89 : 16 C.W.N. 985 : 23 M.L.J. 311 : 12 M.L.T. 352 : (1912) M.W.N. 944 : 14 Bom. L.R. 1046 : 16 C.L.J. 606 and 23 Ind. Cas. 121 : 38 B. 369 : 16 Bom. L.R. 26 there are no such incumbrances, there can scarcely be any room for the exception, and there is a merger under the section. In the former case where under the local revenue law, land was sold for arrears of revenue subject to any mortgage subsisting at the date the arrears fell due, and it appeared that the arrears fell due between the date when the mortgagee purchased the property under his mortgage-decree and the confirmation of the sale to him, it was held that the mortgage-debt was extinguished as from the date of the purchase and that there was consequently no mortgage subsisting at the date when the arrears fell due. The only mortgage of any of the suit properties effected by the 1st defendant subsequently to the suit mortgage and before he parted with his interest in the equity of redemption under Exhibit K was in favour of the father of the 31st defendant of items 53 and 56 for Rs. 160 under Exhibit 19. The 1st defendant whose evidence must be received with caution deposes that subsequently to the original mortgage, Exhibit A, which was renewed by the suit mortgage, Exhibit F, he executed two mortgages in favour of one , a District Registrar, and these mortgages if are still outstanding.on the date of Exhibit 3 would have been postponed to the suit mortgage. It appears, however, from Exhibits 43 and 44 that on the 7th December 1889 the 1st defendant sold two villages for Rs. 30,000 to one , who undertook to discharge these mortgages out of the purchase-money and as we find no reference to them either in Exibits F, L or 19--the mortgage-deeds have not been produced--I think it is not shown that these mortgages were outstanding at the date of Exhibit 3 as to afford any ground for supposing that it was the intention of tha 1st plaintiff to keep the suit mortgage alive as a protection against them or to bring the case within the exception to Section 101 of the Transfer of Property Act. ", "3. The subsequent mortgage of two items only for the small sum of Rs. 160 under Exhibit 19 could not affect the mortgagee's intention as regards the other items. We find the 1st plaintiff and his brother in 1901 pleading in the plaint, Exhibit 11, that by virtue of Exhibit 3, the entire interest in the suit lands, which were included in the properties mortgaged under Exhibit F, belonged exclusively to them and in 1903 by Exhibit 10, they mortgaged the suit properties for Rs. 2,000 without any reference to any subsisting mortgage on them. In these circumstances and apart from Exhibit L, I do not think it is shown that there was not a merger under the terms of Section 101 , Transfer of Property Act , when the mortgagees acquired the equity of redemption under Exhibit 3. As to Exhibit L, I cannot agree with the Subordinate Judge that the reservation of the suit mortgage inserted out of its proper place in that document is sufficient evidence of an intention, on the part of the mortgagees at the date of the purchase of the equity of redemption some five years previously, to keep alive the suit mortgage: it might be otherwise if the purchaser of the equity of redemption under Exhibit 3 by the 1st plaintiff was benami for the 1st defendant, but that is not the plaintiffs' case and is negatived by the way in which the plaintiffs subsequently dealt with the property as full owners. ", "4. If there was a merger under Exhibit 3, the suit mortgage was discharged and the suit as framed must fail. The Subordinate Judge has dismissed the suit as regards some of the subsequent alienees for value from the 1st defendant, on the ground that the 1st plaintiff attested the conveyances under which they claim, but has overruled that plea in the case of the present appellants in the absence of such attestation. Even if the facts do not amount to an estoppel, the conduct of the 1st plaintiff in executing Exhibit L in a form which at first sight represents the 1st defendant as purchasing free from incuinbrances and his subsequent conduct in treating the 1st defendant as full owner and attesting alienations by him to third parties, would appear to have misled the present appellants and having regard to these and to other suspicious circumstances going to the foundations of the plaintiffs' claim, I think it sufficient to say that that claim fails as laid and that the appeal must be allowed and the suit dismissed with costs throughout. ", "5. , J.--I entirely agree with my . The 1st defendant was the owner of the properties in suit. He mortgaged them to the father of the 33rd defendant in 1882 (Exhibit A). The 1st plaintiff's father obtained an assignment of that mortgage (Exhibit B) in 1892. Some payments were made towards the debt. Finally in 1897, the 1st defendant executed Exhibit P for the debt remaining unpaid under Exhibit A to the 1st plaintiff's father. Previous to it a lease (Exhibit E) was granted to the mortgagee for a period of 10 years from 1893. The 1st plaintiff's father was in possession under that lease. The rent reserved was only Rs. 300 a year, which on the evidence was far below what the 1st defendant could have got as income from the mortgaged property. It was suggested that this low rent was paid as the arrangement was that the 1st plaintiff's father should pay himself the amount due under the mortgage from the surplus income. But there is no clear evidence of this agreement. While the 1st plaintiff's father was in possession, a money decree was-obtained against the 1st defendant by a third party, and in execution of that decree the equity of redemption in the mortgaged properties was purchased by one\" for Rs. 185. It was said' that this purchase by was really benami for the plaintiff. There are recitals in some of the documents which show that was only a name-lender for the 1st plaintiff; but it is not necessary to pursue this matter further, because nothing turns upon it. conveyed the equity of redemption purchased by him to the 1st plaintiff by Exhibit III in 1900. The 1st plaintiff sold to the 1st defendant all his right, title and interest in the properties subject to a reservation, which I shall refer to later on, under Exhibit L on the 30th of June 1905. It is proved that after this purchase by the 1st defendant, he either sold or mortgaged the properties as if he were absolute owner thereof. On the 20th March 1906 he mortgaged to the 6th defendant some of the properties which were covered by Exhibit L for Rs. 1,000 (Exhibit XX). This was attested by the 1st plaintiff. By Exhibit IV on the 27th April 1906 the 1st defendant transferred to his daughter another portion of the property. This again was attested by the 1st plaintiff. By Exhibit II of the 13th May 1906, he transferred to his wife some property. On the 26th November 1906 he mortgaged to certain persons another portion of the property under Exhibit IX. Both these alienations were similarly attested by the 1st plaintiff. I will now refer to transactions which were not attested by the 1st plaintiff. On the 7th April, 1907, the 1st defendant by Exhibit XV mortgaged to the 8th defendant some properties included in Exhibit L. By Exhibit XIII on the 10th May 1907, he mortgaged to the same person, the 8th defendant, another property for Rs. 600. On the 15th August 1907 by Exhibit XVI, he sold other properties to the 12th defendant. In all these documents, whether attested by the 1st plaintiff or not, there are recitals which were calculated to induce the transferee to believe that the 1st defendant was the absolute owner of the properties ho was dealing with. The 1st plaintiff instituted the present suit to enforce his mortgage rights under Exhibits A and F. No claim is put forward in respect of the reservation contained in Exhibit L. The basis of the 1st plaintiff's claim is that the mortgage of 1892 and of 1897 is still subsisting, and that he is entitled to proceed against the properties for the debt duo to him. The 1st defendant is the original mortgager and the transferee of the rights of the 1st plaintiff in the equity of redemption. The other defendants are the alienees of the mortgaged properties from the 1st defendant. The defence of these alienees was, the right of the 1st plaintiff under the mortgages was extinguished by the transfer which he obtained from of the equity of redemption. The Subordinate Judge came to the conclusion that as against those alienees whose conveyances or mortgages were attested by the 1st plaintiff, the 1st plaintiff is not entitled to rely on his mortgage to bring the properties in their possession to sale, but that the 1st plaintiff was entitled to proceed against the properties of the other defendants whoso alienations were not attested by him (1st plaintiff). These latter defendants have preferred this appeal. ", "6. Before dealing with the questions of law argued by Mr. , it is well to point out that the 1st plaintiff is the son-in-law of the 1st defendant, and that the appellants are strangers to both the 1st plaintiff and the 1st defendant. The result of the 'conclusion at which the Subordinate Judge has arrived is to throw on the property in the hands of these appellants the whole burden of the mortgage-debt amounting to Rs. 23,000 and odd. It is clear that those properties are not worth more than Rs. 16,000 or Rs. 17,000 at the utmost. There is the question that these appellants wore liana fide purchasers for value. I am unable to accept the contention of the appellants that the Ist plaintiff is estopped by his conduct in attesting the sale-deeds in favour of his wife and mother-in-law from now disputing that the 1st defendant had riot an absolute interest in the properties. There is unfortunately no clear evidence that these appellants took the properties on the faith of the conduct of the 1st plaintiff. Although I have come to the conclusion, I feel little hesitation in saying that this is an iniquitous attempt on the part of the 1st defendant to charge the whole mortgage-debt upon properties in the hands of strangers after having secured to his relations with the concurrence of the 1st plaintiff a large slice of the property originally mortgaged. ", "7. One other circumstance may be mentioned. This suit is not based upon Exhibit L, which is a conveyance from the 1st plaintiff to the 1st defendant and which also contains a reservation in 1st plaintiff's favour in respect of his, mortgage. It was argued by the learned for the appellants that the clause in this document which says the amount due to the said Visvanatha Aiyar is Rs. 2,000. This sum of rupees two thousand and the hypothecation right which I have and which is mentioned on the first page hereof are not discharged from the deed\", can have no effect as against the clear and unambiguous recital in the operative portion of the document. It has to be noticed that, while the-first portion of the document was signed and attested, this latter portion is not attested. It has been suggested that this latter clause was a memorandum made at the time of registration to enable the executant to pay less stamp duty upon the document than he would have been obliged to do if the\" property was conveyed free of encumbrances. This suggestion receives support from the fact of the so-called reservation not being attested and also from the fact that subsequently the Collector to whom the document was sent by the Registrar levied the full stamp duty on the document, treating apparently the new clause as of no effect. It has also been argued before us that if in a deed the subsequent clause is inconsistent with the operative portion of it, effect should not be given to it. on Deeds, page 80, and the observations of , in v. 2 Q.B. 940 at p. 967 : 2 G. and D. 326 : 11 L.J. Ex. 442 : 114 E.R. 364 : 57 R.R. 842. were quoted for the proposition. It is not necessary to give a decision whether the highly artificial rules of construction regarding deeds drawn up by solicitors fully, conversant with conveyancing can be applied to documents executed in this country. The cardinal principle which should guide in such matters is to ascertain the intention of the parties. Technical rules of construction should as far as possible be avoided. Therefore, I do not rest my decision upon the construction to be placed on Exhibit L. This suit was not based upon that document; it is not necessary in the view I am taking to decide whether by this memorandum, made at the end of the document, the 1st plaintiff reserved to himself the right to proceed against the properties. Exhibit L will be relevant in considering whether the alienees, who must be deemed to have had constructive notice of its contents, understood the document to convey only a limited interest to the 1st defendant. This document and the other evidence bearing on the question will be considered in that connection. ", "8. The main point for decision is whether, by the purchase of the equity of redemption from , the 1st plaintiff's mortgage-debt was extinguished. Mr. contended that if there are intervening incumbrances, the purchaser of the equity of redemption may use his mortgage as a shield to protect himself against them, but that he could not sue upon his mortgage. There is no document from the 1st defendant to the 1st plaintiff which secures any right to proceed against the property in the hands of the former. Section 101 of the Transfer of Property Act was relied upon very strongly by Mr. for the respondent. That section was intended to introduce with some limitations the rule of law enunciated in v. 3 Mer. 210 : 17 R.R. 67 : 36 E.R. 81. That decision has been the subject of considerable adverse criticism in the English Courts. Quite recently, in v. (1914) A.C. 132 : 83 L.J. Ch. 349 : 110 L.T. 434 : 58 S.J. 218 discussed that judgment. Some of the observations of the learned Lords who delivered their opinions indicate that this case is no longer a binding authority. However that may be, Courts in India are governed by the statutory provisions contained in Section 101 of the Transfer of Property Act. It is clear that section contemplates the existence of puisne encumbrances. Unless that may be the object, the clause relating to the subsistence of the encumbrance being for the benefit of the purchaser can have no meaning. The person who becomes absolutely entitled to the property cannot reserve in his favour and ss against himself his own mortgage. As I read the section, it leaves untouched the general rule of law that when a mortgagee purchases the equity of redemption the incumbrance in his favour is extinguished. It only enacts that where there are other mortgages on the property, an intention will be imputed to the mortgagee-purchaser that he intended to keep alive his own mortgage as a protection against subsequent claimants. The discussion in in the case already referred to shows that the rule enabling the purchaser to fall back on his mortgage is an infringement of legal rights. Consequently a strict construction should be placed on this provision of law. I am of opinion that the mortgagee-purchaser can use his previous mortgage only as a shield if there are mesne encumbrances, and that also only in respect of the properties which are covered by such encumbrances. I shall deal with the questions whether there were any subsisting encumbrances at the time the equity of redemption was purchased later on. Even if there are such encumbrances, I am of opinion that the mortgagee-purchaser is not entitled to sue upon his mortgage. I am also of opinion that the 1st plaintiff did not intend to keep alive the 1st mortgage for his benefit. The clause in Exhibit L reserving such right is suspicious; The relationship of the parties (son-in-law and father-in-law) suggests that the 1st plaintiff parted with his absolute rights. It is true that the low price for which the sale was effected is an element for consideration. As against this, there is the fact that upon the properties of the value of over Rs. 50,000 the 1st defendant recovered only Rs. 300 a year for 10 years. It may be that the son-in-law-parted with his full rights in view of his having enjoyed the large income from the properties. There is the further fact that after the transfer under Exhibit L absolute conveyances attested by the 1st plaintiff were effected of the properties. The 1st plaintiff could not have intended to reserve his mortgage rights when he knew that these properties were to be sold to his own wife and his mother-in-law. To my mind the relationship of the parties, the enjoyment of a large income by the 1st plaintiff without accounting for it to the 1st defendant and the subsequent conduct in attesting conveyances, all show unmistakably that the 1st plaintiff never intended to keep his mortgage alive. Further, the 1st plaintiff before the sale to the 1st defendant conducted proceedings as absolute owner. See Exhibits XI, S, X and Q 4. It is clear from these documents that it was not for his benefit to regard himself as a mortgagee. ", "9. The contention that the purchaser has two distinct and separate interests in the property in all cases where there are mesne incumbrances found favour with , J., in the case reported as v. 7 C.L.J. 1 at p. 32 but reversed this decision. 16 Ind. Cas. 210 : 40 C. 89 : 16 C.W.N. 985 : 23 M.L.J. 311 : 12 M.L.T. 352 : (1912) M.W.N. 944 : 14 Bom. L.R. 1046 : 16 C.L.J. 606. The observations of their Lordships leave no room for doubt that where there are no encumbrances, there is an extinguishment of the right under the mortgage when the equity of redemption is acquired. 23 Ind. Cas. 121 : 38 B. 369 : 16 Bom. L.R. 26 and 23 Ind. Cas. 559 : 36 A. 327 : 12 A.L.J. 457 are to the same effect. In v. 7 M.H.C.E. 229, it was decided by this Court that the mortgage right can only be used as a shield against puisne encumbrances. Considerable stress was laid on behalf of the respondent upon the decision of the Full Bench in 9 Ind. Cas. 513 : (1911) 1 M.W.N. 165 : 21 M.L.J. 213 : 9 M.L.T. 431 (F.B.). In that case there was first a simple mortgage, then the mortgagor granted a mortgage. The first mortgagee became the owner of the equity of redemption by purchasing it at a sale in execution of a decree in a suit on his mortgage to which the mortgagee was not a party; and then brought a suit to recover possession of the property from the mortgagee. The learned Judge held that he was not entitled to possession, the ground of decision being that the 1st mortgagee can only claim to stand in the shoes of the mortgagor, and as the mortgagor had given a mortgage the first mortgagee-purchaser acquired no right to sue for possession. There can be no question that this conclusion is correct. But the respondent's relies upon certain observations in the judgment for the position where there are puisne encumbrances, the first mortgagee-purchaser can never get an absolute title to the property. In page 225 it is stated: Merger, on principle, is impossible, for the case of first mortgagee acquiring the equity of redemption, when a second mortgage is still outstanding, is not one of the rights and correlative objection coalescing in the same person, or of a smaller interest getting absorbed by a larger, or of two contiguous interests carved out of property combining to form a larger whole.\" No authority is quoted for this broad proposition excepting an extract from Lindley's Jurisprudence, Appendixes 57 and 58 I may mention that the term merger is not appositely used in this connection. The rights of puisne encumbrancers are neither lost nor merged in the title acquired by the mortgagee-purchaser. They would be outstanding--See Section 55 , Clause (d) of the Transfer of Property Act . The only question is whether the first mortgage is capable of enforcement as such in a suit founded on it. If it was intended to lay down that it is open to a mortgagee purchaser to sue on his mortgage to foreclose the latter mortgages, I respectfully dissent from the conclusion. In my view the mortgage was extinguished when the 1st plaintiff acquired the equity of redemption and it is not open to him to sue upon it, whatever may be his rights to use the mortgage as a defence against puisne encumbrancers. 16 Ind. Cas. 877 : 38 M. 18. Moreover, there is no satisfactory evidence in this case of any subsequent mortgages having subsisted at the time the ejuity of redemption was purchased from Suudara Raja Aiyangar. This question was not argued before the Subordinate Judge; the documents creating these mortgages have not been exhibited. But reliance is placed upon two judgments in which reference is made to, them. Those judgments do not show that the mortgages were valid and subsisting at the time when the equity of redemption was acquired by the 1st plaintiff and his predecessor. On-the other hand Exhibits 43 and 44 show that the previous encumbrances were intended to be paid off in 1889. Non const at, they have not been discharged. ", "10. I would, therefore, allow the appeal and dismiss the suit against these defendants with costs here and in the Court of first instance."], "relevant_candidates": ["0000112461", "0000871841", "0000909741", "0001247605", "0001690181"]} {"id": "0001911635", "text": ["JUDGMENT . J. ", "1. This appeal under Clause 15 of the Letters Patent is directed against the order dated December 6, 1988 passed by a learned Judge of this Court issuing a Rule Nisi and an interim injunction on a petition under Article 226 of the Constitution of India filed by ('Association' for short) and its five members. Facts relevant for the purpose of disposal of the appeal are as under. ", "2. ('' for short) is a incorporated under the Indian Companies Act , 1913, with the liability of its members limited by shares, having its registered office at 3-A Shakespeare Sarani, Calcutta and carries on business at, amongst other places, Andul Road, Howrah where it has one of its factories. The is engaged in the business of, amongst others, manufacture of iron and steel materials. The is managed and controlled by a Board of Directors, which include two nominee Directors, one nominated by and the other by . The work-force of the in its factory at Howrah includes a category of staff called Junior Management Staff whose duties are primarily supervisory in nature. They have an Association of their own called . ", "3. On October 28, 1987 the Company declared a lock-out of the factory at Howrah on the ground, inter alia, that workmen employed in its various divisions had resorted to illegal strike. Though the Junior Management Staff were kept outside the purview of the lock-out, the Company did not pay their salaries from November, 1987 onwards, on the plea that there was acute shortage of funds, though earlier assurances were given that salaries would be paid soon. ", "4. The and its six members (hereinafter collectively referred to as the 'Writ Petitioners') thereupon filed the writ petition on September 23, 1988, wherein they have contended, inter alia, that the Company has a sound financial base and sufficient funds to pay its employees. Inspite thereof, the Company taking advantage of the prolonged lock-out and the financial strait of the members of , is luring them to a Voluntary Retirement Scheme. The writ petitioners have further alleged that the Company's management has been coercing the members of the individually to voluntarily retire or face termination of service. Accordingly, they have sought for various reliefs, as detailed in the petition, through issuance of appropriate Writs against the Company. ", "5. When the writ petition was presented before the learned Trial Judge on September 23, 1988, directions were issued for filing affidavits. Thereafter, when the petition came up for hearing preliminary objections as to its maintainability were raised on behalf of the on the grounds, that no writ lay against the and even if such writ lay the reliefs sought for in the petition could not be granted as they were for enforcement of a contract of employment. After hearing the parties, the learned Trial Judge issued a Rule Nisi as prayed for and passed an interim order. Aggrieved thereby, the has filed the appeal. ", "6. Before us also, the threshold questions about the maintainability of the writ petition and the reliefs sought for therein were raised and argued at length. First, it was contended on behalf of the appellant that by no stretch of imagination could it be said that the Company answered to the definition of 'State' within the meaning of Article 12 of the Constitution of India so as to make it amenable to the writ jurisdiction of . The other contention was that a contract of employment, which the writ petitioners were seeking to enforce, could not be executed through issuance of Writs. ", "7. In elaborating the first contention, it was submitted on behalf of the that , through its various decisions, had laid down the tests for ascertaining whether a was an instrumentality or agency of the so as to answer to the description of 'other authorities', and for that matter 'State' within the meaning of the Article 12 of the Constitution of India and if the status of the was scrutinised in the light of the above tests it would be found, that none of them stood satisfied. Consequently, it was argued that no writ would lie against the . Though a number of cases of dealing with the above question were cited at the during the hearing of the appeal, we would, to avoid restatements and prolixity, refer to a few of them. The first of the cases which requires to be considered in this respect is that of (1981-I-LLJ-103), which was decided by its Constitution Bench. In that case, the question -arose whether , which was a society registered under the Jammu & Kashmir Registration of Societies Act , 1898 was an authority within the meaning of Article 12 of the Constitution of India. In answering the question,' the observed (pp. 112-113): ", "\"The tests for determining as to when a corporation can be said to be an instrumentality or agency of may now be culled out from the judgment in case (1979-II-LLJ-217). These tests are not conclusive or clinching, but they are merely indicative indicia which have to be used with care and caution, because while stressing the necessity of a wide meaning to be placed on the expression 'other authorities', it must be realised that it should not be stretched so far as to bring in every autonomous body which has some nexus with the within the sweep of the expression. A wide enlargement of the meaning must be tempered by a wise limitation. We may summarise the relevant tests gathered from the decision in case as follows: ", "(1) \"One thing is clear that if the entire share capital of the corporation is held by , it would go a long way towards indicating that the corporation is an instrumentality or agency of .\" ", "(2) \"Where the financial assistance of the is so much as to meet almost entire expenditure of the corporation, it would afford some indication of the corporation being impregnated with governmental character.\" ", "(3) \"It may also be a relevant factor .......whether the corporation enjoys monopoly status which is conferred or protected.\" ", "(4) \"Existence of deep and pervasive Control may afford an indication that the corporation is a agency or instrumentality\". ", "(5) \"If the functions of the corporation are of public importance ahd closely related to governmental functions, it would be a relevant factor in classifying the corporation as an instrumentality or agency of Government.\" ", "(6) \"Specifically, if a department of is transferred to a corporation, it would be a strong factor supportive of the inference of the corporation being an instrumentality or agency of .\" ", "If on a consideration of these relevant factors it is found that the corporation is an instrumentality or agency of , it would, as pointed out in case, be an 'authority' and, therefore, 'State' within the meaning of the expression in Article 12.\" ", "Applying the above tests in the facts of that case, the Court found that the Society which managed at Srinagar was a 'State' under Article 12. The above quoted tests have been quoted with approval and followed by in the latest cases of (1988-I-LLJ-3-41) and v. Defence Minister-cum-Chairman BOG, (1989-I-LLJ-263). ", "8. In the earlier case of v. (1981-I-LLJ-79) the above tests were quoted with approval. It was pointed out by that the finale was reached when their cumulative effect was assessed and once the body was found to be an instrumentality or agency of the , the further conclusion emerged that it was 'State' and subject to the same constituional limitations as . In case (supra), it was similarly observed that it was not necessary that all the tests should be satisfied for reaching the conclusion either for or against holding an institution to be 'State' and in a given case, some of the features might emerge so boldly and prominently that a second view might not be possible, but there might be other cases where the matter would be on the border line and it might be difficult to take one view or the other outright. When judged in the light of the above tests, keeping in view the observation made by in the case of (supra) in the passage quoted earlier that \"the tests were neither clinching nor conclusive but they were merely indicative indicia which have to be used with care and caution, because while stressing the necessity of a wide meaning to be placed on the expression 'other authorities', it must be realised that it should not be stretched so far as to bring in every autonomous body which had some nexus with the within the sweep of the expression\" (exphasis supplied), the conclusion is inevitable that the appellant-Company cannot be brought within the meaning of 'State' under Article 12 of the Constitution. ", "9. Admittedly, the is incorporated under the Indian Companies Act , 1913 and 73.23 % of its equity share capital are held by individuals and other limited Companies, including some foreign Companies and the balance 26.77% shares are held by financial institutions. It is common knowledge that in the normal course of their business, financial institutions advance money to entrepreneours and established undertakings, some of them on the condition that a portion of such loans might be converted into equity capital. Besides, the financial institutions make purchase of shares in the market as business investments. The acquisition and holding of only 26.77% shares of the by the financial institutions through such routine business transactions cannot certainly satisfy the first two tests laid down by . Mr. , appearing for the writ petitioners, in his usual fairness, conceded that not only the above two tests, but the fifth and sixth tests were also not satisfied in the facts of the instant case. He, however, asserted that the third and fourth tests stood satisfied in respect of the appellant . According to Mr. , as the was engaged in a core industry like steel and iron and was one of the largest undertakings in that field, it could certainly be said to be holding a monopoly status. Even if we, for our present purposes, accept the fact that the enjoys a monopoly status, still then the third test would not stand satisfied as such status has to be ' conferred or protected'. As there is no material on record to even indicate far less prove, the above ingredient, the contention of Mr. in this regard must be negatived. ", "10. To bring home his contention that the fourth test stood conclusively satisfied, in the instant case, Mr. strongly relied upon the determination of in the case of . It will be necessary, therefore, to refer to and deal with the case of MC. (supra) at length. ", "11. On December 4, 1985, a major leakage of oleum gas took place from one of the units of and in Delhi. This leakage affected a large number of persons, both amongst the workmen and the public, and an Advocate practising in of Delhi died on account of inhalation of oleum gas. Hardly had the people got out of the shock of this disaster when, within two days, another leakage, though this time a minor one, took place as a result of escape of oleum gas from the joints of a pipe. Applications were, thereafter filed by and in for award of compensation to the persons who had suffered harm on account of escape of oleum gas. As those applications for compensation raised a number of issues' of great Constitutional importance, the Bench of the three Judges which was hearing the applications forwarded them to a larger Bench of five Judges. One of the questions which arose for consideration at the time of hearing was whether Article 21 of the Constitution was available against declared industrial policies, was ultimately intended to be carried out by shares and which was engaged in an industry vital to public interest and with potential to affect the life and health of the people. On behalf of the applicants, it was contended that Article 21 was available as was carrying on an industry which, according to the 's own declared industrial policies, was ultimately intended to be carried out by itself, but instead of the immediately embarking on that industry, was permitted to carry it on under the active control and regulation of the . Special emphasis was laid on behalf of the applicants on the regulatory mechanism provided under the Industries (Development and Regulation) Act , 1951, where industries are included in the schedule if they vitally affect public interest. It was pointed out that regulatory measures were also to be found under the Environment Act , 1986 and other allied legislations. Reliance was also placed upon the fact that sizeable aid in loans, lend and other facilities were granted by the to in carrying on the industry. Taking aid of the American Action doctrine, it was also argued on behalf of the applicants that private activity, if supported, controlled or regulated by the might get so entwined with al activity as to be termed action and it would then be subject to the same constitutional restraints on the exercise of power as the . ", "12. In controverting the above contentions, it was submitted on behalf of Shriram that control or regulation of a private corporation's functions by the under general statutory Law, such as the Industries (Development and Regulation) Act , 1951 was only in exercise of police power of regulation by the and such regulation did not convert the activity of the private corporation into that of the . It was contended that control which deemed a an agency of the , must be of the type where the controlled the management policies of the , whether by sizeable representation on the board of management or by necessity of prior approval of the before any new policy of management was adopted, or by any other mechanism. ", "13. In order to deal with the rival contentions, traced that part of the development of Article 12 where it embarked on the path of evolving criteria by which a could be termed 'other authority' under Article 12. In doing so, the considered its earlier decisions and quoted with approval the tests laid down in case (supra) as applied in case (supra) and the observations made in the latter. The then pointed out that the controversy as to whether the manner in which a was brought into existance had any relevance to the question whether it was instrumentality or agency was set at rest in the case of (supra). The further pointed out that a might be a Statutory created by a statute or it might be a society registered under the Societies Registration Act or a formed under the Companies Act : any such would come within the ambit of Article 12 , if it was found to be an instrumentality or agency of the on proper assessment of the relevant factors. ", "14. In the light of the above principles of law, the proceeded to examine whether a Private Corporation such as , which was engaged in the manufacture of chemicals and fertilisers, came within the ambit of Article 12 so as to be amenable to the discipline of Article 21. For that purpose, the first examined Industrial Policy Resolutions of 1948 and 1956 and then the Industries (Development and Regulation) Act , 1951 enacted to carry out the objectives of the policy, resolutions. On such examination, the found that the industry of 'Chemicals and Fertilisers' was specified in the First Schedule of the above Act as it was deemed by the to be an industry of vital public interest, whose public import necessitated that the activity should be ultimately carried out by the itself, though in the interim period with support and under the control, Private Corporations might also be permitted to supplement the effort. The next took notice of fact that the Industries (Development and Regulation) Act , 1951 made the activities of an undertaking engaged in an industry scheduled therein subject to extensive and detailed control and supervision by the and even empowered the to take over and manage such undertaking if after investigation held under the Act it was found that its affairs were being managed in a manner detrimental to public interest. The also took notice of the fact that was required to obtain licences, under the Factories Act and Delhi Municipal Act and was subject to extensive environment regulation under the Water (Prevention and Control of Pollution) Act , 1974 and Air (Prevention and Control of Pollution) Act , 1981, that is, all such activities which could jeopardise public interest. The next observed that such functional control was of special significance as it was the potentiality of the fertiliser Industry to adversely affect the health and safety of the community and its being impregnated with public interest which perhaps dictated the policy decision of the to ultimately operate this industry exclusively and invited functional control. The next took note of the fact that, along with the extensive functional control, received sizeable assistance in the shape of loans and overdrafts running into several crores of rupees through various agencies. It was men said by the , \"Moreover, is engaged in the manufacture of Caustic soda, Chlorine etc. Its various units are set up in a single complex surrounded by thickly populated colonies. Chlorine gas is admittedly dangerous to human life and health. If the gas escapes either from the storage tank or from the filled cylinders or from any other point in the course of production, the health and well-being of the people living in the vicinity can be affected. Thus, is engaed in an activity which has the potential to invade the right to life of large sections of people.\" ", "15. The Court then posed the question whether those factors were comulatively sufficient to bring Shriram within the ambit of Article 12 and observed \"Prima, facie it is arguable that when the 's power as economic agent, economic enterpreneur and allocator of economic benefits was subject to the limitations of fundamental rights vide ; ; (supra) and v. of Jammu and Kashmir (1980) 3 S.C.R. 1388 , why should a private corporation under the functional control of the which is hazardous to the health and safety of the community and it is imbued with public interest and which the ultimately proposes to exclusively run under its industrial policy, not be subjected to the same limitations. But we do not propose to decide this question and make any definite pronouncement upon it for reasons which we shall point out later in the course of this judgment\". That the Court did not propose to decide the questions has been reiterated in paragraph 30 of the judgement with the following words: ", "\"But we do not propose to decide finally at the present stage whether a private corporation, like , would fall within the scope and ambit of Article 12 because we have not had sufficient time to consider and reflect on the question in depth.\" ", "16. The then proceeded to deal with the other question raised in the case and after answering the same, observed in paragraph 33 that since it was not deciding the question as to whether was an authority within the meaning of Article 12 so as to be subjected to the I discipline of the fundamental right under Article 21 , it did not think it would be justified in setting up a special machinery for investigation of the claims for compensation made by those who alleged that they had been victims of oleum gas escape. ", "17. A detailed and careful reading of the above case clearly indicates that , in no uncertain terms, stated that it was not deciding the question as to whether a private corporation could be made amenable to the discipline of fundamental rights. In other words, even though the mooted the question whether a , like , could be included within the ambit of Article 12 , it did not answer the same. It cannot, therefore, be said that has expressed any opinion on the subject as to be binding upon us either as obiter or ratio decidendi. ", "18. Mr. , however, submitted that even if it was held that did not make any decision on the point, still then the observations made by it would have a persuasive effect. Accordingly, Mr. submitted that from the observations made therein, he could successfully argue that the appellant-company was an intrumentality or agency of the . We are unable to persuade ourselves to rely upon the observations of referred to earlier for, in making the same, it was largely influenced by the fact that Shriram was engaged in an activity which was dangerous to life and health and had the potential to invade the right of large sections of people. ", "19. It is of course true that the appellant-Compahy, like , is engaged in an industry which comes under the purview of the first schedule to the Industries (Development and Regulation) Act , 1951 and as such, the has powers to assume management and control of the Company if it is found that its affairs are being managed in a manner detrimental to public interest. In other words, the has the regulatory control over the affairs of the Company through various legislations. But in our view, such control cannot be said to be \"deep and pervasive control\" so as to satisfy the fourth test. In the case of (1975-I-LLJ-399), Justice pointed out that a mere finding of the control was also not determinative of the question whether a was an instrumentality or agency of the , since a had considerable measures of control under its police power over all types of business operations and it was not possible to assume that panoply of law and authority of a under which people carry on ordinary business or their private affairs or own property, each enjoying equality in terms of legal capacity, would be extraordinary assistance. The learned judge next observed that a finding of financial support plus an unusual degree of control over the management and policies might lead one to characterize an operation as action. While on this point, we may, even at the risk of repetition, remind ourselves of the observation made in the case of (supra) that the six tests were to be used with care and caution, because while stressing the necessity of a wide meaning to be placed on the expression 'other authorities' it must be realised that it could not be stressed so far as to bring other autonomous body which has some nexus with the within the sweep of the expression; a wide enlargement of the meaning must be tempered by a wise limitation. ", "20. If merely on the basis of the facts that a Company incorporated under the Companies Act is running a business in any of the industries appearing in the first schedule of the Industries (Development and Regulation) Act , 1951 and that for running its business it has obtained loans from financial institution for which such institution has placed a Director in , an inference that it is an instrumentality or agency of the Government has to be drawn, then in that case a private limited company carrying on business in cigarettes, which also finds place in the first Schedule of the above Act, with loan would have to be called an instrumentality or agency of the . Widening of the scope of Article 12 to such an extent will not only be unwise but unjustified also. ", "21. In view of our above discussion, we must hold that by no stretch of imagination can the appellant-Company be said to be an instrumentality or agency of the so as to bring it within the ambit of Article 12 of the Constitution of India. The first point raised on behalf of the appellant must, therefore, succeed. In view of that success, the other point raised on behalf of the appellant in support of the appeal need not be gone into. ", "22. In the result, the appeal succeeds and the same is hereby allowed. The impugned order is hereby set aside and the Rule issued on the writ application is discharged. There will be no order as to costs."], "relevant_candidates": ["0000426032", "0000743328", "0001186368", "0001281050", "0001497108", "0069408974", "0105948173"]} {"id": "0001915577", "text": ["PETITIONER: THE UNION OF INDIA Vs. RESPONDENT: RAM KANWAR AND OTHERS DATE OF JUDGMENT: 29/08/1961 BENCH: , K. BENCH: , K. GAJENDRAGADKAR, P.B. HIDAYATULLAH, M. CITATION: 1962 AIR 247 1962 SCR (3) 313 CITATOR INFO : RF 1972 SC1935 (9) RF 1973 SC 569 (13) RF 1979 SC1459 (67) RF 1980 SC1632 (31) R 1984 SC1503 (9,10) ACT: Letters Patent Appeal-Limitation for filing-Requisition and de-Requisition of building- Indian Limitation Act , 1908 , s.29 (2) Art. 151- Punjab High Court Rules, r. 4De once of India Rules, r. 75A-Requisitioning and Acquisition- any of Immovable Property Act, 7952 , ss. 3 , 24 (2)Requisitioned Land (Continuance of Powers) Act, 1947 (XIIII of 1947). HEADNOTE: A building belonging to the respondents was requisitioned by under r. 75-A (1) of the Defence of India Rules originally for the purpose of occupation by a certain officer of and afterwards by the officers of . After the building was vacated by the said officers it was put in the possession of which was a private dance and music school. The respondent's appeal to for de-requisitioning the building having failed be filed a petition for mandamus for that purpose in which was allowed. The appellant's appeal under the Letters Patent filed within 30 days under the rules of but beyond 20 days as prescribed by the Limitation Act from the judgment of the single judge was dismissed as barred by time and also on the merits. On appeal by special leave. Held, that r. 4 of Rules which allows Letters Patent appeals to be filed within 30 days from the date of the judgment of the single judge is a special law within the meaning of s.29(2) of the Limitation Act and such appeals may be filed within the said period of 30 days and not 20 days as prescribed by Art. 151 of the First Schedule of the Limitation Act v. , A.I.R. 1941 Lah. 57, approved. Held, further, that under s.24(2) of the Requisitioning and Acquisitioning of Immovable Property Act, 1952, which repealed the Requisitioned Land (Continuance of Powers) Act, 1947, a fiction was created to the effect that properties requisitioned under the earlier Act should be deemed to be requisitioned under s.3 of the Act. The effect of the fiction was that the requisition made under r. 75-A of the Defence of India Rules was a requisition tinder s.3 of the 1952 Act, that is, the 314 purpose mentioned in r. 75-A shall be deemed to be a public purpose of the within the meaning of s.3 of the Act. In the present case as the building in question was being used for a purpose other than that for which it was originally requisitioned under r. 75-A it was liable to be de-requisitioned. JUDGMENT: ", "CIVIL APPELLATE JURISDICTION : Civil Appeal No. 322 of 1960. Appeal by special leave from the judgment and order dated November 21, 1957, of (Circuit Bench) at Delhi in L.P.A. No. 4 of 1955. ", ", Attorney-General of India, , and , for the appellant. and , for the respondents Nos. 1 to 6. ", ", and , for the respondent No. 7. ", "1961. August 29. The Judgment of the Court was delivered by , J.-This appeal by special leave is preferred against the judgment of a division bench of of at Delhi confirming that of a single Judge of issuing a writ of mandamus against directing it to restore possession of the flat requisitioned by the said to the respondents. ", "One was the owner of Flat No. 5, Aggarwal Building, Connaught Circus, New Delhi; respondents 1 to 6 are his sons-and widow. By an order dated April 14, 1943, requisitioned the said flat under r.75- A(1) of the Defence of India Rules for a period of one year from April 15, 1943. to April 14, 1944. The said flat was put in the occupation of one of . The period of requisition was extended from time to time, and finally by an order dated April 2, 1946, the flat was requisitioned from April 15, 1946, until further orders of . After Mr. vacated the flat, it was allotted to other officers. requested the from time to time to de-requisition the said flat for his personal use. He represented that he was suffering from heart trouble and was continuously keeping indifferent health, that two of his sons had got married, and that in those circumstances it had become impossible for him to continue to live in their small house in a narrow lane ; but rejected his request on the ground that on surrender by the officers of it would be required for allotment to Central officers. died on October, 24, 1951. It appears that four or five months in 1947 the flat was vacant and thereafter it was occupied by refugees from West Pakistan. It was afterwards given to the present respondent No. 7, . On November 4,1952, respondent No. 1 again requested the to de- requisition the flat mainly on the ground that the said flat was not in use of the officers of but was put in possession of , which was a private dance and music school. As no reply was given to that request, the said respondent sent a reminder on June 26, 1953, and to that he received a reply to the effect that \"the matter is receiving attention and further communication will follow in due course.\" On September 16, 1953, the informed the first respondent that he could execute a lease deed in favour of the in respect of the said flat. As the appellants did not put the respondents in possession of the said flat, they had no alternative but to file a petition for a writ of mandamus in . The petition was heard by , J., and the learned Judge issued a writ of mandamus on October 19, 1954, directing the appellants to put the respondents in possession of the flat. Against the said order, on November 26, 1954, the appellants filed a Letters Patent appeal in the Circuit Bench of at Delhi. The appeal was filed within 30 days from the date of the said order after excluding the time taken for obtaining certified copies of the necessary documents but more than 20 days thereafter. The appeal was heard by a division bench of the said. consisting of the Chief Justice and J. The learned Judges held that the appeal was filed out of time and that there was not sufficient reason for excusing the delay. They also went into the merits of the case and agreed with , J., that a case had been made out for issuing a writ. With the result that the appeal was dismissed. Hence the present appeal. ", "Learned Attorney-General, appearing for the appellants, contends, that the Letters Patent appeal, it having been filed within 30 days from the date of the judgment of Falshaw, J., was within time, and that, in any view, having regard to the fluid state of the law on the question whether the and prescribed by the Limitation Act or the rule by would govern that appeal, there Was sufficient cause for excusing the delay. On the merits he argues that the requisition made under r.75-A of the Defence of India Rules (hereinafter called the Rules) was continued unders.3 of the Requisitioned Land (Continuance of Powers) Act, 1947 (Act No. 17 of 1947) (hereinafter called the 1947 Act), whereunder the appropriate Government was given the power to use or deal with a requisitioned land in such manner as may appear to it to be expedient, that in exercise of the said power the said Government put in possession of the same, and that under s.24(2) of the Requisitioning and Acquisitioning of Immovable Property Act, 1952 (hereinafter called the 1952 Act), the said requisition shall be deemed to be property requisitioned under s.3 of the said Act and that under the said section the said purpose must be deemed to be a public purpose, being the purpose of the and, as that purpose did not cease to exist, the respondents are not entitled to ask for de-requisition of the said flat. ", "Mr. , learned counsel for the respondents, seeks to sustain the order of both on the question of limitation as well as on merits. Three questions fall to be considered in this appear, namely (1) what is the period of limitation prescribed for an appeal against an order of a Single Judge of to a division bench of the same ? (2) if the appeal was preferred out of time, was there a sufficient cause for excusing the delay in preferring the appeal ? (3) are the respondents now legally entitled to ask to de-requisition the said premises under the 1952 Act ? ", "To appreciate the first contention it is necessary to read the relevant provisions of the Limitation Act , the clauses of the Letters Patent and the rules made by . ", " The Indian Limitation Act , 1908. ", "\" Section 29 . (2) Where any special or local law prescribes for any suit, appeal or application a period of limitation different from the period prescribed therefor by the First Schedule, the provisions of section 3 shall apply, as if such period were prescribed therefor in that Schedule......\" ", "The First Schedule Description of appeal Period of Time from of which limitation period begains to run ", "151. From a decree or order of any of at Fort William, Madras and Bombay, Twenty The date of or of the days the decree or order of Punjab in the exercise of its original jurisdiction. ", "LETTERS PATENT FOR . ", "Clause 27. And WE do further ordain that it shall be lawful for at Lahore from time to time to make, rules and orders for regulating the practice of the and for the purpose of adopting as far as possible the provisions of the Code of Civil Procedure, being an Act, No. V of 1908, passed by the Governor-General in and the provisions of any law which has been or may be made, amending or altering the same, by competent legislative authority for India, to all proceedings in its testamentary, intestate and matrimonial jurisdiction respectively. Clause 37. And We do further ordain and declare that all the provisions of these Our Letters Patent are subject to the legislative powers of the Governor-General in Legislative , and also of the Governor-General in under section seventy-one of the Government of India Act, 1915; and also of the Governor-General in cases of emergency under section seventy-two of that Act, and may be in all respects amended and altered thereby. Rules and Orders of the High of Punjab. Rule 4: No memorandum of appeal preferred under clause 10 of the Letters Patent shall be entertained if presented after the expiration of 30 days from the date of the judgment appealed from, unless the admitting Bench in its discretion, for good cause shown, grants further time for the presentation. ", "319 ", "It is clear from the aforesaid provisions that while under Art. 151 of the Limitation Act a period of 20 days is prescribed for preferring an appeal from an order of in the exercise of its Original Jurisdiction, under r. 4 of High Rules for an appeal under cl. 10 of the a period of limitation of 30 days is provided. If Art. 151 applies, the appeal in the present case was clearly barred. But if r. 4 could be invoked, then the appeal was well within time. The combined effect of the provisions may be stated thus: Under cl. 27 of the , the High of Judicature of Lahore has the power to make a rule prescribing the period of limitation in respect of appeals from orders made by that in exercise of its Original Jurisdiction to a division bench of that High . Under el. 37 thereof, the provisions of the are subject to the legislative powers of the Governor-General in and, therefore, any rule made in exercise of a power conferred under the must necessarily be subject to the provisions of the Limitation Act which is a law made by the . Article 151 of the Limitation Act prescribes the period of limitation of 20 days for preferring an appeal against an order made by the High in exercise of its original jurisdiction, and if there is no other limitation on that section, r. 4 of the High Rules must give way to the said Article. But s. 29(2) of the Limitation Act limits the scope of that section, for it says that where a special or local law prescribes for an appeal a period prescribed therefore in the said Schedule, the provisions of s. 3 shall apply as if such period were prescribed therefor in that Schedule, that is, if there is a special or local law prescribing a period of limition, it will be deemed to be the period of limitation prescribed by the First Schedule to the Limitation Act in respect of an appeal covered by that rule. To state it differently, if r. 4 is a special law, the Limitation Act itself must be deemed to prescribe the period of limitation mentioned under that rule for the class of cases covered by the said rule, and to that extent the rule derogates from Art. 151 of the First Schedule to the Limitation Act . Article 151 must be read subject to the special law. In this view, the argument that cl. 37 of the makes the rule made by the High subject to the Limitation Act and, therefore, that Art. 151 shall prevail over r. 4 has no force. Briefly stated, the legal position is this: Under el. 27 of the , the High has power to make a rule prescribing the period of limitation for a appeal against an order of a single Judge made in exercise of the original jurisdiction of the High , and by reason of cl.37 thereof, the said rule is subject to the provisions of the Limitation Act ; but the Limitation Act itself saves the operation of the said rule. With the result that r. 4 applies to such an appeal, whereas Art. 151 of the Limitation Act will govern appeals not covered by r. 4 or appeals, from orders made by other High s in exercise of their original jurisdiction, if no rule similar to r. 4 is made by the said High or High s. In the premises the only question to be decided is whether r. 4 is a special law within the meaning of s. 29(2) of the Limitation Act. Rule 4 is made by the High in exercise of the legislative power conferred upon the said High under cl. 27 of the . As the said rule is a law made in respect of special cases covered by it, it would certainly be a special law within the meaning of s. 29(2) of the Limitation Act. ", "This view was accepted by in , punjab Cotton Press Company, Ltd. (in liquidation) (1). There, a full bench of that High Court held that the statutory rules framed by the (1) A.I.R. 1941 Lahore 57 (F. B.). ", "321 ", " under cl. 27 of the Letters Patent under the authority delegated to it by His Majesty who, in turn, was acting under the powers conferred on him by Act of Parliament, are a \"special law\". We agree with this view. It is not necessary to deal with other decisions cited at the , for in none, of them the scope of s. 29 of the Limitation Act was considered. Indeed, Mr. has not contended that r. 4 is not a special law within the meaning of s. 29 of the Limitation Act. If so, it follows that under r. 4 an appeal could be filed within 30 days from the date of the order of Falshaw, J., and the appeal having been filed on the twenty-third day, it was well within time. ", "In this view, the second question does not fall to be considered in this appeal. ", "On merits, the question turns upon the construction of the relevant provisions of the Defence of India Rules, the 1947 Act and the 1952 Act. For easy reference and comparison, the relevant provisions may be read at one place. ", "The Defence of India Rules Rule 75-A. (1) If in the opinion of or it is necessary or expedient so to do for securing the defence of British India, public safety, the maintenance of public order or efficient prosecution of the war, or for main- taining supplies and services essential to the life of the community, that Government may by order in writing requisition any property movable or immovable, and may make such further orders as appear to that Government to be necessary or expedient in connection wit h the requisitioning. ", "x x x x x x (2) Where the Central Government or has requisitioned. any property under sub-rule (1) that Government may use or deal with the property in such manner as may appear to it to be expedient, and may acquire it by serving on the owner thereof, or \",here the owner is not readily traceable or the ownership is in dispute, by publishing in the official , a notice stating that , as the case may be, has decided to acquire it in pursuance of this rule. , The Requisitioning and Acquisitioning of Immovable Property Act, 1952 (XXX of 1952) Section 24 . (1) The Requisitioned Land (Continuance of Powers) Act, 1947 (XVII of 1947), the Delhi Premises (Requisition and Eviction) Act , 1947 (XLIX of 1947) and the Requisitioning and Acquisitioning of Immovable Property Ordinance, 1952 (III of 1952) are hereby repealed. ", "(2) For the removal of doubts, it is hereby declared that any property which immediately before such repeal was subject to requisition under the provisions of either of the said Acts or the said Ordinance shall, on the commencement of this Act, be deemed to be property requisitioned under section 3 of this Act, and all the provisions of this Act shall apply accordingly. ", " Section 3 . (1) Where the competent authority is of opinion that any property is needed or likely to be needed for any public purpose, being a purpose of the Union, and that the property should be requisitioned, the competent authority- ", "(a) shall call upon the owner or any other person who may be in possession of 'the property by notice in writing specifying therein the purpose of the requisition to show cause, within fifteen days of the date of the service of such notice on him, why the property shall not be requisitioned ; ", "x x x x Section 6 . (1) The Central Government may at any time release from requisition any property requisitioned under this Act and shall, as far as possible, restore the property in as good a condition as it was when possession thereof was taken subject only to the change caused by reasonable wear and tear and irresistible force : ", "Provided that where the purpose for which any requisitioned property was being used ceased to exist, shall, unless the property is acquire under section 7 release that property, as soon as may be, from requisition. ", "The Defence of India Rules were issued under the Defence of India Ordinance, 1939, which was repealed by the Defence of India Act, 1939, but the said rules were kept alive by virtue of the provisions of s. 21 of the said Act. Under r.75-A of the said Rules, the power to requisition a property was conditioned by the purposes for which it could be so requisitioned, though it was left to the subjective satisfaction of the to decide whether it was necessary or expedient to do so. After requisition, was authorized to deal with the property in such manner as might appear to it to be expedient. The expediency in the context can only mean expediency in relation to the purposes for which the property was requisi- tioned. The wide import of the word \"expedient\" in Sub-s. (2) must necessarily be limited to the purposes under sub-s. (1) as otherwise we would be attributing to the an intention to confer a power on the to requisition a property on false pretenses. Act 17 of 1947 was enacted to provide for the continuance of certain emergency powers in relation to land which, when the Defence of India Act expired, was subject to requisition effected under the rules made under that Act. \"Requisitioned land\" was defined to mean an immovable property which at the commencement of the said Act was subject to any requisition effected under the said rules. Under s. 3 thereof notwithstanding the expiration of the said Act and the rules made thereunder, the requisitioned land was continued to be subject to requisition until the expiry of the said Act, and it authorized the appropriate \"to use or deal with any requisitioned land in such manner as may appear to it to be expedient\". The object of the Act was only to continue the. requisition after the expiry of the life of the Defence of India Act and not to enlarge the powers of the in respect of the requisitioned land. The land requisitioned under the Ordinance continued to be subject to the requisition. The expression \"continue\" clearly brings out the idea that the scope of the section was only to give a further lease of life to the order which otherwise would have expired. The words \"may use or deal with any requisitioned land in such manner as may appear to it to be expedient\" were only a repetition of the words in r. 75-A (2) of the Rules conferring authority on the to do certain things in respect of requisition ; and the scope of the authority under s.3 of the 1947 Act must be similar to that under r.75-A(2) of the Rules. Under s.24 (1) of the 1952 Act, the 1947 Act was repealed. Under sub-s. (2) thereof, it was provided that on the commencement of the Act the properties which were subject to requisition under the provisions of the earlier Act shall be deemed to be property requisitioned under s.3 of the Act and that all the provi- sions of the Act shall apply accordingly. Relying upon the deeming clause, it is contended that the requisition of the land and the user of the same by the under the 1947 Act should be deemed to be a requisition made, under S. 3 of the 1952 Act, for a public purpose, being the purpose of the , and as that purpose, namely user by , had not ceased, the appellants were not bound to de-requisition under s. 6 of the Act. But the fiction created by s. 24 (2) of the Act would operate only upon the requisition already made. The fiction could not validate any illegal act of the . Therefore, the question is what was the effect of the earlier requisition under the Rules as well as under the 1947 Act. If the requisition originally made was for purposes mentioned in r.75 of the Rules and continued under s.3 of the 1947 Act only for the said purposes, under s. 3 of the 1952 Act the requisition of the property made for the said purposes would be deemed to be a requisition for a public purpose being a purpose of the . But the validity of the requisition could be judged on the basis of the pre-existing statutes and not on the basis of the provisions of the sections of the 1952 Act. The result is that the requisition of a property made for public purposes under r.75-A of the Rules would be deemed to be a requisition under s. 3 of the Act and all the provisions of the Act would apply accordingly. It is said that under the Rules a requisition need not have been made for a public purpose ; but the express provisions of r, 75-A of the Rules negative this Contention. Though no notice stating the purpose is contemplated under r. 75-A of the Rules, the requisition could have been made only for the four public purposes mentioned in r. 75-A of the Rules. We have pointed out that the requisition for the said purposes only continued under the 1947 Act. The purposes for which it was requisitioned must, therefore, be deemed to be the purposes mentioned in r. 75-A of the Rules. Even if s. 5 of the Act was excluded on the ground that no notice was issued under r. 75-A of the Rules the proviso to s. 6 of the Act would be attracted. Under that proviso, where the purposes for which any requisitioned property was being used ceased to exist, shall release the property, as soon as may be, from requisition. In the present case, on the facts it is manifest that the flat was not used for any of the purposes for which it was requisitioned for a number of years ; and indeed, when the Act came into force, it was used only for locating , which is clearly, not one of the purposes for which the flat was requisitioned. If so, it must be held that the purpose for which the property was requisitioned ceased to exist and the respondents have acquired a right to be put in possession thereof under the said proviso. ", "Even so, the learned Attorney-General contends that the purpose for which the building is now utilised, namely for , is a public purpose' being the purpose of the , within the meaning of s. 3 of the Act, and, therefore, the respondents are not entitled for de- requisition under the proviso to s. 6 of the Act. It is argued that every purpose is a public purpose. The argument proceeds that under the Constitution the may make laws with respect to any of the matters enumerated in List I of the Seventh Schedule to the Constitution, and also in respect of any matters enumerated in List III thereof, that under Art. 73 the executive power of the extends to the said matters and that, therefore, the requisition of property made for any of the purposes connected with such matters, whether in regard thereof laws were made or not, would be a requisition for a public purpose, being a purpose of the , within the meaning of B. 3(1) of the 1952 Act. In support of this con- tention reliance is placed upon the decision of this court in (1). There is a fallacy underlying this argument. The (1) 2 S. C. R. 867. ", "327 ", "effect of the fiction is that the requisition made under r. 75-A of the Rules is a requisition under s. 3 of the 1952 Act, that is, if the requisition was made for purposes mentioned in r. 75-A of the Rules, it would be deemed to be one for a public purpose, being the purpose of the , within the meaning of s. 3 of the 1952 Act. The criterion is not, therefore, whether a particular purpose for which a building was used when the Act came into force was a public purpose, being the purpose of the , within the meaning of s..3 of the 1952 Act, but whether it was requisitioned for one of the purposes mentioned in r. 74-A of the Rules. If those purposes ceased to exist, the proviso to s. 6 of the 1952 Act made it obligatory for the to release the property. As the flat was being used for a purpose other than that for which it was requisitioned, the respondents were entitled to be put in possession thereof. In this view, we do not propose to express our opinion on the validity of the contention raised by the learned Attorney-General based upon the decision of this Court. In the result the appeal fails and is dismissed. Costs will be governed by the order dated 11-8-61. ", "Appeal dismissed. ", "328"], "relevant_candidates": ["0000894810", "0001172121"]} {"id": "0001918091", "text": ["JUDGMENT Sen, J. ", "1. The appellants are the sons of one , opponent No. 3 in Darkhast Not 452 of 1937 filed in at Devrukh by one , respondent No. 1, in execution of a decree passed in the latter's favour on June 7, 1927, against opponents Nos. 1 and 2, judgment-debtors, named and . had been one of the ' creditors and his claim was referred to arbitration, an award made and a decree passed in regular civil suit No. 80 of 1927. The decree directed that defendants Nos. 1 and 2 should pay to the plaintiff the principal amount of Rs. 2,178 within five years with interest at six per cent. per annum, that the past interest of Rs. 272 should be paid within a year from the date of the decree, and that if the defendants committed default in payment of this amount of interest in time, the plaintiff would be entitled to recover the whole amount payable by the sale of certain immoveable property on which a charge in respect of Rs. 2,178 was created, and it further provided that if the sale proceeds were insufficient, the deficit should be recoverable out of the remaining property of the defendants and from the defendants personally. There was a similar provision regarding interest accruing annually from the date of the decree. Default having been committed, , the decree-holder, brought the present darkhast for sale of six of the properties covered by the charge, and further prayed that if the sale proceeds fell short of the money due to him, another property belonging to the judgment-debtors, viz. survey No. 40, should also be brought to sale. Prior to the present darkhast, had filed four darkhasts, viz. darkhast No. 247 of 1928, darkhast No. 195 of 1931, darkhast No. 436 of 1932 and darkhast No. 465 of 1934. In the last of those darkhasts he had prayed for rateable distribution of the sale proceeds which would be realised in another and prior darkhast No. 324 of 1934 filed by one , a mortgagee of the , in execution of a decree for Rs. 426-8-2 obtained in civil suit No. 349 of 1929. In that darkhast the proceedings had been transferred to the Collector under Section 68 of the Code of Civil Procedure and a sale ordered. The sale was to take place on June 10, 1935. On that day the applied for six days' time for arranging for a private sale, and on June 11 the granted permission, purporting to act, it seems, under Order XXI, Rule 83, on condition that the money realised should be deposited in by June 15, 1935. The permission referred to three encumbrances on lots Nos. 9 to 14, the property in respect of which the present darkhast No. 452 of 1937 has been filed, viz. two encumbrances in favour of , including the one which was being enforced in the execution proceedings, and one in favour of one . The arranged for a sale of lots Nos. 9 to 14 with the appellant, . agreed to forego his claim on lots Nos. 9 to 14 and to confine it to another property, via. lot No. 15. In respect of the other encumbrance in favour of the latter had obtained a decree in civil suit No. 348 of 1929 and an amount of Rs. 940 was due thereon. A sale-deed, exhibit 47, was passed on June 15, 1935, in favour of for Rs. 1,366-8-2 (the total of the two amounts due to under the two decrees against the ). It was recited therein that Rs. 426-8-2 due under the decree in regular civil suit No. 349 of 1929 was to be paid into for the complete satisfaction of the darkhast and that Rs. 940 was to be kept with the vendee, , for being paid in the execution proceedings of suit No. 348 of 1929. accordingly paid Rs. 426-8-2 into on June 15, 1935, and the sale-deed was taken to, the Sub-Registrar for registration on June 17, 1936. On the same day, but before the deed had been brought to the Sub-Registrar, made an application to the latter requesting him that in case a sale-deed in favour of was brought for registration, the vendee should be notified of his decree of 1927 for Rs. 2,178 and costs and interest. It is admitted that the Sub-Registrar duly notified of this application before the sale-deed, exhibit 47, was registered. did not at once deposit Rs. 940 in as ordered by the ; had to file darkhast No. 320 of 1935 seeking to bring the property to sale, and thereupon deposited Rs. 975-13-0 in on April 7, 1936. On this amount being paid to , the property in dispute became free from 's encumbrance. ", "2. In this darkhast, No. 452 of 1937, the following objections were taken by the appellant, , the judgment-debtors remaining absent : ", "(1) The previous darkhast No. 465 of 1934 was not an application made in accordance with law, and therefore the present darkhast was barred under Article 182 , Clause (5), of the first schedule to the Indian Limitation Act ; (2) the appellant was a bona fide purchaser for value without notice of the charge created in favour of ; , therefore, could not enforce his decree against him; and (3) even if could do so, the appellant was entitled to claim subrogation as he had satisfied the two encumbrances of Sane which were prior to 's charge. held that none of the objections were tenable, and ordered the sale of the property mentioned in the darkhast application. The appeal to was dismissed. ", "3. The objection on the point of limitation is this. Rateable distribution which was sought in darkhast No. 465 of 1934 could not, it is urged, have been granted under Section 73 of the Code of Civil Procedure as that section applies only to applications made to the \"in execution of decrees for payment of money against the same judgment-debtor\"; it is contended that 's decree was not such a decree and that, therefore, the previous darkhast was not in accordance with law. The learned District Judge who has decided the first appeal has found this argument untenable on the following grounds. Though in other parts of the Code of Civil Procedure, for instance, in Order XXI, Rules 20 and 53 and Section 54 , a decree for money simpliciter is placed in contradistinction from a decree for sale in enforcement of a mortgage or charge, and though the view taken by both Sir and of the law would support this contention, he has held, following v. (1885) I.L.R. 11 Cal. 718, (1896) I.L.R. 20 Mad. 107 and v. (1905) I.L.R. 28 Mad. 473, F.B., that a decree by virtue of which money is payable is to that extent a \"decree for money\" (the phraseology used in Section 296 of the Code of 1882 under which these cases were decided), which expression the learned District Judge has apparently considered to be equivalent to the expression \"decree for the payment of money \" to be found in the present Section 73 . Other decisions ( (1897) I.L.R. 25 Cal. 580 (1899) I.L.R. 27 Cal. 285, v. Sheobarat Rai (1894) I.L.R. 16 All, 418 and (1900) I.L.R. 22 All. 401) which appear to take a contrary view have been distinguished, on the ground that they were mostly cases under Section 48 of the present Code or the old Section 230 corresponding thereto, and that they were not cases under Section 73 . The learned District Judge has further held that under the sub-clause \"thirdly\" in Clause (3) of the proviso to Section 73 mete encumbraces which have been incorporated into decrees are contemplated and that under the sub-clause \"fourthly\" must be included \"encumbrances which are merged in a decree,\" apparently including a decree for sale in enforcement of a mortgage or charge. ", "4. The learned District Judge has next relied on v. (1926) I.L.R. 53 Cal. 664, (1933) 36 Bom. L.R. 643, Firm Johar Mal v. Bindeswari Prasad A.I.R. Pat. 522, All. 97, (1909) I.L.R. 34 Bom. 189, s.c. 12 Bom. L.R. 13, (1912) I.L.R. 37 Bom. 42, s.c. 14 Bom. L.R. 861, (1918) I.L.R. 42 Bom. 420, s.c. 20 Bom. L.R. 421 and (1918) I.L.R. 43 Bom. 44, s.c. 20 Bom. L.R. 872, and held that as the application for rateable distribution conformed with the requirements of Order XXI, Rule 11, was accepted by the , and was registered and duly disposed of, and as the did not dispose of it on the ground that it was contrary to law, the relief asked for was one substantially in accordance with law, and that there was a mere inaccuracy in asking for the relief such as would not render it absolutely nugatory for purposes of limitation. \"It was open to the to decide either that the relief prayed for would fall under the clause 'fourthly' or under clause 'thirdly' and that would have been a decision on merits.\" ", "5. The prayer clause in darkhast No. 465 of 1934 was as follows : ", "Regular darkhast No. 324 of 1934 is pending against the defendants in this Court. Out of the sale proceeds that will be realised in that darkhast rateable distribution should be allowed for Rs. 3,433-3-4 the amount due under this decree; costs of these execution proceedings and future interest on Rs. 2,178 at 6 per cent. per annum till the date of repayment should be allowed. ", "6. The question is whether this is \"an application made in accordance with law for execution or to take some step in aid of execution\" within the meaning of Clause (5) of Article 182 of the Indian Limitation Act . ", "7. The contentions of Mr. on the point of limitation may be thus summarised : ", "(1) A distinction has been made in the Code of Civil Procedure between decrees for payment of money (the expression used in Section 73 ) and decrees for sale in enforcement of a mortgage or charge (see Section 48 , Order XXXIV, Rule 11, Order XXI, Rule 20, Order XXI, Rule 11(1), Order XI, Rule 53 and Order XXXIV, Rules 4 to 6). ", "(2) v. (1885) I.L.R. 11 Cal. 718, (1896) I.L.R. 20 Mad. 107, and v. Somasundram Pillai (1905) I.L.R. 28 Mad. 473, F.B., relied on by the learned District Judge, were all decided under Section 295 of the Code of 1882, where the expression used was \"decree for money.\" In v. , the suit was under the last clause of Section 295 , corresponding to Clause (2) of Section 73 . and it had been filed before payment had been made to the wrong person. It was, therefore, held that the suit was premature, and the observations on which the learned District Judge has relied, therefore, appear to be obiter. \" Decree for money \" may mean something more than a decree for the payment of money and may include a decree under which money is recoverable, e.g. by sale or otherwise. ", "(3) 's commentary at page 293 of the Code of Civil Procedure is against construing the expression \"decree for payment of money\" as including \"decree for sale in enforcement of a mortgage or charge.\" ", "(4) There are several cases which construe the expression \" decree for the payment of money,\" which occurred in Section 230 of the old Code, corresponding to the present Section 48 , e.g. (1897) I.L.R. 25 Cal. 580 and (1889) I.L.R. 27 Cal. 285 where decrees were similar to the one in (1896) I.L.R. 20 Mad. 107, and it was held that the decrees were not decrees for the payment of money. This construction of the expression cannot be brushed aside as inapplicable to cases falling under Section 73 . ", "(5) Sub-clauses \"thirdly\" and \"fourthly\" of Clause (3) of the proviso to Section 73 relied on by the District Judge do not support his interpretation. ", "(6) It is not enough that the application in darkhast No. 465 of 1934 should have complied with provisions, e.g. Order XXI, Rule 11, which prescribe the formalities to be observed in filing an application for execution, (1909) I.L.R. 34 Bom. 189, s.c. 12 Bom. L.R. 13 and (1912) I.L.R. 37 Bom. 42, s.c. 14 Bom. L.R. 861 show that the must be competent to grant the relief asked for, and that the party applying must have the right to apply in the manner in question [see also v. jani Bijai Shankar (1905) I.L.R. 27 All. 619.] ", "8. Mr. 's answer to the above arguments is two-fold : ", "(1) The decree we have to deal with is an award decree and not a decree for sale in enforcement of a mortgage or charge. It is similar to a consent decree, and the relief asked for in the darkhast of 1934 was the realization of an amount of money, and this was within the decree. See judgment in janardan v. which was held to be correct in (1940) 43 Bom L.R. 26, F.B.. Both these were cases of consent decrees in terms similar to those of the present decree, and it was held in those cases that it was open to the decree-holder to seek to realize a part of his money claim without first proceeding against the mortgaged or charged property. The considerations which would apply to mortgage decrees would be inapplicable to an award decree such as we are dealing with : it is in form different from that of a mortgage decree. ", "(2) The formal requirements of law in filing the darkhast, such as those prescribed by Order XXI, Rule 11, were duly complied with in the application in darkhast No. 465 of 1934, and it was not dismissed on the ground that it was not in accordance with law. The question whether the decree was one for payment of money or not could only be decided after examining the nature and the meaning of that decree, i.e. it would be a question for trial on the merits. There are decided cases in support of both views. A possible inaccuracy or error in the mode in which the decree was sought to be executed, based on one of the two views which was well arguable, cannot make the application one not in accordance with law. ", "9. I propose to examine first the second of Mr. 's arguments. If that is found acceptable, it would, it seems to me, render it unnecessary to examine the contentions of Mr. . ", "10. Looking at the matter apart from authorities, it appears to me, in the first place, that a mere compliance with the formal requirements of the Code of Civil Procedure as to the manner of filing, and the particulars to be shown in, an application for execution would not suffice to make it an application in accordance with law. A decree-holder seeking enforcement of a money decree, e.g. might seek to bring to sale property not belonging to the judgment-debtor and not covered by the decree and yet might follow the requirements of O. XXI in framing his application. Such an application would on the face of it be one not in accordance with law. It also seems to me that the expression \"not in accordance with law\" cannot be construed so as to mean \" not in accordance with law on the face of the application.\" Where the has wanted to refer to a mistake or error apparent on the face of the record, it has made express mention of it, as in Order XLVII, Rule 1. No provision in the Indian Limitation' Act is based on such a qualification, which would appear to 'be altogether foreign to the kind of considerations that arise on a question of limitation. It, therefore, appears to me that the expression \"in accordance with law\" must have some reference to the material content, apart from the form and formal content, of the application for execution. The particulars of a written application for execution required to be shown are given in Order XXI, Rule 11(2), the tabular form-mentioned therein being Form 6 in appendix E to the Code. The most material particular is Clause (j), \"the mode in which the assistance of the is required.\" The last sub-clause under that clause is \"(i) otherwise, as the nature of the relief granted may require.\" It seems to me essential that this mode must be one in accordance with law. In the present case the mode in which the 's assistance was required was rateable distribution under Section 73 . If, therefore, the decree-holder was not entitled to ask for the relief in that \"mode\" and if the had no power to grant such relief, it seems prima facie that the application would be one \"not in accordance with law.\" With reference to the' last Sub-clause (v) of Clause (j) of O. XXI, Rule 11, Sub-rule (2), it is to be noted that Section 235 , Clause (j), of the Code of 1882, corresponding thereto required the application for execution to state \"the mode' in which the assistance of the is required as the nature of the relief sought may require\" and not \" as the nature of the relief granted may require,\" as in the present Code. This appears to be a material alteration; prima facie under the old Code even if the relief sought was not strictly claimable, yet the application would necessarily not be bad in itself, whereas under the present provision it has to conform to the nature of the relief actually granted by the decree. ", "11. Coming now to the authorities, we have' first two cases of this , and , there had been a decree on June 30, 1900, ordering partition of immoveable property and making the execution of the decree conditional on the payment 6th the proper court-fees. On June 29, 1903, an application for the execution of the decree was made, but it was dismissed as it was not accompanied by the payment of court-fees. A second application to execute the decree was presented on June 27, 1906, accompanied by payment. The lower s dismissed it on the ground that it was time-barred inasmuch as the first application made in 1903 had not been one in accordance with law as required by Article 179 of Schedule II to the Indian Limitation Act . In support of that order it was argued that the application of 1903 had asked the to do what it was not competent to do, i.e. to make the partition without payment of court-fees. It was held that as payment was prescribed under the decree as a condition of partition, but not as a condition of the making of the application for partition, the application asked for something within the decree and was, therefore, in accordance with law, for it was competent to the to order the execution to begin on the court-fees being paid within a certain period. the plaintiff obtained a decree against the defendants, and he sought to execute the decree by filing six darkhasts, all within time. The lower held that the sixth darkhast was not filed within time, for the first five darkhasts could not be taken into consideration for purposes of limitation, as they had not been \"in accordance with law,\" because every one of them had sought relief or reliefs which on considering' the merits of the darkhasts the could not have granted. It was held that each of those darkhasts claimed the relief granted by and therefore within the decree and that the question whether on a consideration of all the facts the could in the events that had happened grant the relief was only a question for trial on the merits. Their Lordships in that case were concerned with the construction of Article 179 of the Indian Limitation Act Of 1877, Clause (4), which contained the words \"the date of applying in accordance with, law to the proper for execution,\" etc. pointed out the difference between Section 235(j) and the last words of Order XXI, Rule 11(2), Clause (j) \"as the nature of the relief granted may require,\" and remarked (p. 49) :- ", "If a person other than one entitled to apply applies for execution, or if the person entitled applies for execution in a mode and for a relief outside the decree, the application is not in accordance with law for the plain reason that the decree of which execution is sought is not in reality the decree to which the application professes to relate but some other decree, one not existing and, therefore, incapable of execution according to law. The decree in such a case not existing, the application made as to it shares its fate and is treated as non-existent, Where, on the other hand a decree gives certain reliefs, and the application for execution seeks some or all of them, it may be that, after going into the merits of the application and considering on evidence all the circumstances and equities of the case, the comes to the conclusion that the particular relief or reliefs sought shall not be granted. But that decision of the on the merits cannot affect the application for the purposes of the question whether it is by itself in accordance with law, provided it meets in substance the requirements of the Code of Civil Procedure or any other law relating to execution. ", "The test applied, therefore, was whether the decree-holder applied in a mode and for a relief not outside the decree. thought that the words \"in accordance with law\" were an adverbial qualification of the word \"applying.\" \"It is not even an application but it is the applying which must be in accordance with law.\" This appears to me to be too subtle a distinction hardly applicable to the phraseology adopted in the present Article 182. added (p. 52) :- ", "On the other hand if it is to be said that a decree-holder is not applying in accordance with law merely because he asks for something, which under the decree the cannot grant him, we are, I think, confronted, at least in all cases where the decree is complicated or intricate, with this difficulty that the question whether an applying is made according to law can only be decided by an adjudication of the application on its merits. I venture respectfully to doubt whether that is intended. If the applying complies with the forms and the procedure prescribed in that behalf, I should be disposed to say that the applying was in accordance with law, and not the less so, because, on the merits of the application, whether for one reason or another, the application had to be refused; nor do I think that the difficulty which I have mentioned is satisfactorily removed by any distinction between what appears on the face of the application and of the decree and what appears by a more careful consideration of those documents; for in practice I should doubt whether it would be possible to maintain any such distinction. ", "With great respect, it seems to me clear that at least so far as the present provisions of Order XXI, Rule 11, Sub-rule (2), Clause (j), are concerned, the did not intend that a mere formal compliance' with the form and procedure prescribed should be enough : one indication of this appears to be provided by the amendment of the words \"as the nature of the relief sought may require\" by replacing the word \"sought \"by \".granted.\" I would interpret dictum that the relief sought must not be \"outside' the decree\" as meaning that it must be within the power of the to grant such relief as is sought, though in the particular case the relief may not in fact happen to be granted. ", "12. In v. (1926) I.L.R. 53 Cal. 664 the question that arose for consideration was whether an application returned to the decree-holder under Order XXI, Rule 17, for amendment and not filed within the time allowed by the was an application in accordance with law, and their Lordships observed (p. 673) :- ", "...the expression 'in accordance with law' in Article 182(5) should be taken to mean that the application though defective in some particulars was such upon which execution could be issued. If the omissions were such as to make it impossible for the to issue execution upon it, as was the case in (1890) I.L.R. 17 Cal. 631, where the list of the properties to be attached and sold was not supplied with the application for execution, it should be held that such an application is not in accordance with law. But where the application is such as to enable the to take further steps in execution it cannot generally be said that such an application, if not defective in material and substantial matters is an application not in accordance with law. ", " (1892) I.L.R. 16 Mad. 142 of Madras, following its earlier decision in (1883) I.L.R. 6 Mad. 250, held that an application for execution, if defective in matters which cannot be said to be material or substantial, should be considered to be an application in accordance with law. In Chattar v. (1889) I.L.R. 12 All. 64 it was held that the term \"applying in accordance with law\" means applying to the : to do something which by law that. was competent to do; it did not mean applying to the to do something which, either from the decree-holder's direct knowledge of facts or his presumed knowledge of law, he knew that the was incompetent to do. This was followed in v. jani Bijai Shankar (1905) I.L.R. 27 All. 619. (1933) 36 Bom. L.R. 643 though it was not necessary for the purposes of that decision to pronounce any opinion on the point, expressed the view that in order to see whether a particular application for execution was or was not in accordance with law, what had to be looked to in each particular case was whether the executing would or would not issue execution on the application for execution as preferred to it, and he approved of the test laid down in v. (1926) I.L.R. 53 Cal. 664. ", "13. From the above authorities the main test of an application for execution being in accordance with law would appear to be whether it is possible for the to issue execution upon it, i.e. whether it is within the power of the to grant the kind of relief asked for, though in the particular case the relief may not, on the merits, be granted, e.g. owing to some finding on facts, not to the nature of the application itself. I think, as I have already said above, that this is what was meant by when he said that the relief sought must not be outside the decree. ", "14. The question, therefore, now arises whether, on such a test being applied, darkhast No. 465 of 1984 was an application made in accordance with law. In that application no notice was issued to the judgment-debtor and the dismissed it as premature. The question whether it was an application in accordance with law was not raised in those proceedings, and it must, therefore, now be decided in the present darkhast. It may not be an easy question to decide, and there appear to be authorities both ways. That being so, it was obviously difficult for the decree-holder to know, if the question were put to him, whether the had or did not have the power to grant the relief he was asking for. Prima facie, therefore, it does not appear fair or equitable that he should be exposed to the risk of having his application declared in a subsequent application for execution to have been an application not in accordance with law. But in a recent decision, (1940) 43 Bom. L.R. 346, p.c. their Lordships quoted with approval the following remarks made in 's Law of Limitation and Prescription (Tagore Law Lectures), 6th edition (1932), Vol. 1 (p. 256) :- ", "A law of limitation and prescription may appear to operate harshly or unjustly in particular cases, but where such a law has been adopted by the State,...it must, if unambiguous, be applied with stringency;...the rule must be enforced even at the risk of hardship to a particular party. The Judge cannot, on equitable grounds, enlarge the time allowed by the law, postpone its operation, or introduce exceptions not recognised by it. ", "Their Lordships went on to remark (p. 369) :- ", "Very little reflexion is necessary to show that great hardship may occasionally be caused by statutes of limitation in cases of poverty, distress and ignorance of rights; yet the statutory rules must be enforced according to their ordinary meaning in these and in other like cases. ", "In Nagendranath De v. Sureshchandra De (1932) I.L.R. 60 Cal. 1, their Lordships remarked that in construing provisions as to limitation 'equitable considerations are out of place, and the strict grammatical meaning of the words is, their Lordships think, the only safe guide.' ", "15. I will now take up Mr, 's first contention that the relief asked for being the realization, of an amount of money was within the decree and was, therefore, such as the was competent to give, the decree being similar to those in and (1940) 43 Bom. L.R. 26, F.B.. The decree in the present case was based on an award, the original claim being a money claim of Rs. 2,450. The decree said, in the first place, that the defendants should pay to the plaintiff the principal amount of Rs. 2,178 within five years from April 3, 1927, the interest accruing every year being payable every year and the interest which, had accrued till then, Rs. 272, being payable within a year. It then proceeded to state that if the defendants committed default in payment of this amount of Rs. 272 within a year, the whole amount payable to the plaintiff should be recoverable by sale of the immoveable property on which a charge for the whole amount was placed under the decree. \"If that amount be insufficient,\" further declared the decree, \" the amount of deficit should be recovered out of the remaining property of the defendants and from the defendants personally.\" This was followed by a somewhat similar provision which was to come into operation in case the annual amounts of subsequent interest were not paid in time, one month's grace for payment of such amounts being given. At the date of darkhast No. 465 of 1934, i.e. September 15, 1934, about six and a half years had elapsed from the date of the decree and only Rs. 300 had been paid. The decree-holder was, therefore, entitled to bring the whole property charged to sale. It seems to me clear that under the terms of the decree he was not then entitled to recover the amount due from the judgment-debtor in any other way. In v. there had been a consent decree passed in a mortgage suit under which the defendants were to pay annual instalments of Rs. 300, and in default of payment of any two instalments, the decree-holder was entitled to recover the whole of the amount then due by sale of the mortgaged property. Thereafter the decree ended with these words : \"The whole of the sum due to the plaintiff should be paid up in instalments by paying Rs. 300 each year as above.\" The instalments provided for were not paid, and on the judgment-debtor's failure to pay two instalments, the decree-holder applied to the for the sale not only of the mortgaged property but also of other property belonging to the defendants. It was contended for the judgment-debtors that the only remedy open to the decree-holder was to recover the whole amount by the sale of the mortgaged property only. said (p. 956) : ", "I see no reason to limit the plain meaning of the decree as to the payment of the full amount in instalments by the provision as to the realisation of the full amount by the sale of the mortgaged property in default of the payment of any two instalments. The decree directs the defendants to pay the full amount, and the obligation is not in my opinion limited by the provision relating to the sale of the mortgaged property. ", "This was approved in the full bench case, , where the Chief Justice said (pp. 33-34) :- ", "But I cannot see any reason why one should apply the analogy of a mortgage decree to a consent decree, which must be construed according to the terms of the language used.... In arranging consent decrees of the nature in question, it is usually the creditor, and not the debtor, who is master of the situation, and I can see no justification for holding that, by taking a charge upon specific property, the primary object of which, as I have pointed out, is to secure him against other creditors, the creditor abandons his right to proceed against other property of the debtor. Such an abandonment should not be presumed in the absence of language making clear the intention to abandon. ", "16. The decree in the present case, however, is not a consent decree, in arranging which the creditor could be said to have been the master of the situation, so that he could not have abandoned the general right which he would have, under a money decree, of proceeding against any property of the debtor. The charge was created under the award on which the decree was based, and it seems to me unlikely that the arbitrators not only created such a charge for the benefit of the creditor but also left him the option of proceeding against any property of the debtors even though not covered by the charge. It appears to me that the part of the decree which we are dealing with is intended to operate in the manner of a final decree for sale under Order XXXIV, Rule 5, and that the part of the decree providing for the contingency of the sale-proceeds being insufficient to discharge the judgment-debtor's liability (corresponding to a decree passed under Order XXXIV, Rule 6) cannot be said to have yet become operative. It, therefore, seems to me that though the consent decrees in and might have been decrees for the payment of money, the ground on which they might be so construed is not available to the present decree-holder. For the purpose of construing the present decree with reference to the question whether it is a decree for payment of money within the meaning of Section 73 I think that it should be regarded as on the same footing as a decree for sale for enforcement of a mortgage or charge, and it is on this footing that the' decree has been dealt with in the below. ", "17. Apart from the authorities, it is to be observed that a distinction appears to have been made in the Code between decrees for the payment of money and decrees for sale in enforcement of a mortgage or charge. Section 34 deals with cases in which the may order interest \"where and in so far as the decree is for the payment of money;\" whereas Order XXXIV, Rule 11, deals with the question of interest \"in any decree passed in a suit for foreclosure, sale or redemption.\" Section 48 , Sub-section (7), Clause (6), speaks of a decree or any subsequent order directing \"any payment of money or the delivery of any property.\" Order XXI, Rule 20, makes the provisions contained in Rules 18 and 19 applicable to decrees for sale for enforcement of a mortgage or charge; and Rules 18 and 19 deal respectively with execution in the case of cross-decrees in separate suits for the payment of two sums of money passed between the same parties and execution in the case of cross-claims under the same decree for the recovery of sums of money by two parties from each other. 's note under Rule 20 correctly, in my opinion, states that that rule shows impliedly that the expression \"decree for the payment of money\" and other similar expressions in the Code do not include a decree for the sale in enforcement of a mortgage or charge. Again, Sub-rule (1) of Order XXI, Rule 11, deals with the power of the , where the decree is for the payment of money, to order, on the oral application of the decree-holder at the time of the passing of the decree, the immediate arrest of the judgment-debtor prior to the preparation of a warrant if he is within the precincts of the . Such power obviously cannot vest in the where the decree is for sale in enforcement of a mortgage or charge. This Sub-rule (1) corresponds to Section 256 of the Code of 1882, which begins thus : \"When a decree is passed for a sum of money only, and the amount decreed does not exceted a sum of one thousand rupees the may,\" etc, 'Order XXXIV, Rules 4 and 5, deal respectively with the preliminary and the final decrees in a suit for the sale of mortgaged property; and Rule 6 of the same order directs that where the net proceeds of any sale held under Rule 5 are found insufficient to pay the amount due to the plaintiff, the , on application from him, may, if the balance is legally recoverable from the defendant otherwise than out of the property sold, pass a decree for the balance. It is contended by Mr. on behalf of the appellant, and rightly contended in my opinion, that only where such a decree is passed do we get. in a suit for sale of mortgaged property, a decree for the payment of money. In Order XXI, Rule 53, both the expressions are used : \"where the property to be attached is a decree, either for the payment of money or for the sale in enforcement of a mortgage or charge,\" etc. We thus find throughout all the provisions a clear distinction drawn between the two kinds of decrees. ", "18. It is to be remembered that the expression \"decree for the payment of money\" is not to be found in Section 295 of the Code of 1882, corresponding to Section 73 of the present Code. The expression there' used was \"decree for money.\" All the three cases relied on by the learned District Judge were decided in reference to the old section. The words \"decree for money\" are certainly not so precise as \"decree for the payment of infancy\" : they seem to be capable of meaning \" decrees under which money is payable or recoverable.\" ", "19. The first case relied on by the learned District Judge, v. (1885) I.L.R. 11 Cal. 718, was a suit falling under the last clause of the old Section 295 , corresponding to Clause (2) of the present Section 73 . That suit having been filed before any payment had been made to a person not entitled thereto, it was dismissed as premature. That being so, the observations made in that decision on which the learned District Judge has relied must, in the first place, be strictly regarded as obiter. It was there held that the object of the section was to provide for rateable distribution amongst all persons who had obtained decrees ordering the payment of money to them by the judgment-debtor and that every decree by virtue of which money was payable was to that extent a \"decree for money\" within the meaning of that section, even though other reliefs might be granted by the decree. One ground for this view was thus stated (p. 730) : ", "If it were not so, and if the holder of a mortgage decree, or of any decree under which money was payable and other relief granted, was held not to be the holder of a decree for money, this result would apparently follow, that before he could claim rateable distribution he would be obliged to sue again for his money only. This could hardly have been the intention of the . ", "With all respect, it seems to me that this argument is hardly justified in view of the provisions relating to secured creditors to be found in the three provisos to Section 73 . Besides, apart from the fact that the language of the old Section 295 under which this case was decided is not the same as that of the present Section 73 , it is to be noted that the decree with which the case was concerned contained a distinct order to the mortgagor personally to pay the amount of the mortgage debt. (1896) I.L.R. 20 Mad. 107 purported to follow 's case, but the last feature was absent therefrom, the decree directing the mortgagor to pay the mortgage debt within the period fixed by the and providing that on default the mortgaged property should be sold, the balance (if any) being recoverable from the mortgagor. The decrees in (1897) I.L.R. 25 Cal. 580 and (1899) I.L.R. 27 Cal. 285 were similar to the decree in 's case, and those cases turned on the meaning of the expression \"decree for the payment of money \"which occurred in Section 230 of the Code of 1882, corresponding to Section 48 of the present Code; and it was held that the decrees were not \"decrees for the payment of money\" within the meaning of that section. The decision in v. (1894) I.L.R. 16 All. 418 and (1900) I.L.R. 22 All. 401 are also to the same effect. Sir has remarked at p. 294 of his Code of Civil Procedure, 11th edition : ", "There is little doubt that if were called upon to decide whether a decree of the character in the Madras case was a 'decree for the payment of money' within the meaning of this section, they would hold that it was not. In any event the Madras decision cannot be sustained under this Code : See Order 21, Rule 20. ", "It seems to me difficult to distinguish a construction of the expression \"decree for the payment of money\" occurring in Section 73 from that of the same expression in the old Section 230 , as the learned District Judge appears to have done. The wording of the present Section 48 , Sub-section (1), Clause (b), is, \"Where the decree or any subsequent order directs any payment of money or the delivery of any property;\" while the old Section 230 began thus : \"Where an application to execute a decree for the payment of money or delivery of other property has been made under this section and granted.\" The phraseology used in the present section appears to supply the meaning of the expression in question; and I can see no good reason for supposing that that expression bears different meanings in the present Section 73 and the old Section 230 . ", "20. The third case relied on by the learned District Judge, v. (1905) I.L.R. 28 Mad. 473, F.B. is a full bench case which approved of 's case and followed 's case. The decree in that case contained an order for the sale of the mortgaged property and also an order for the recovery personally from the judgment-debtor and from his other property of what might remain undischarged by the sale-proceeds of the mortgaged property. The question for consideration was whether in execution of the decree the judgment-debtor could set up as a bar to execution an adjustment which had not been certified under Section 258 of the old Code; it had been held in (1901) I.L.R. 24 Mad. 412 that Section 258 was inapplicable to such a case. Their Lordships overruled 's case and said : \" Section 258 must be held applicable to cases in which decree is as here.\" Section 258 of the old Code corresponds to the present Order XXI, Rule 2, where the language used is : \"Where any money payable under a decree is paid out of .\" This case approved of and followed the dictum in 's case that every decree by virtue of which money was payable was to that extent a decree for money. It seems to me, however, that the construction put on the language of the old Section 295 in 's case is inapplicable to the words in Section 73 which we are now concerned with, and that, therefore, this case cannot be regarded as an authority for the purpose of construing those words. ", "21. The learned District Judge has also relied on sub-clauses \" thirdly \" and \"fourthly\" of Clause (c) of the proviso to Section 73 . In his opinion they go to show that Section 73 does not exclude holders of mortgage decrees from its operation, for under \" thirdly\" encumbrances which have not been incorporated into decrees are contemplated, while under \"fourthly\" are included encumbrances which have merged in a decree. Sub-clause \"thirdly\" is to the effect that the proceeds of sale shall, after the expenses of the sale have been met and the amount due under the decree under which the sale has been held discharged, be applied in discharging the interest and principal monies due on subsequent encumbrances (if any). That certainly does not make the holders of such encumbrances participants in the rateable distribution, which is dealt with in the next sub-clause \"fourthly.\" Sub-clause \"thirdly\" guarantees the preservation of the interest of the holders of subsequent encumbrances in full, who would thus have no necessity for the benefits of the rateable distribution. As for the sub-clause \"fourthly,\" that provides for rateable distribution among holders of \" decrees for the payment of money \" against the judgment-debtors who have applied to the in conformity with the earlier part of Sub-section (1). This sub-clause, therefore, uses the same expression as is used in that part of the sub-section, and it would obviously be begging the question to say that it applies to holders of mortgage decrees. In my opinion, the arguments of the learned District Judge based on these two Sub-clauses cannot be sustained by the language and the scheme of the section. ", "22. In the result, it seems to me that the contentions of Mr. must prevail over those urged by Mr. , and it must, therefore, be held that the darkhast of 1934 was not an application for execution made \"in accordance with law.\" That being so, the present application for execution, not having been made within three years from the date of the darkhast which immediately preceded that darkhast, is barred by limitation under Clause (5) of Article 182 of the Indian Limitation Act . ", "23. [After dealing with points not material to this report, the judgment concluded :] In the result, Mr. 's contention on the point of limitation must be upheld, though his other contentions fail. The appeal will, therefore, be allowed, the orders of the lower Courts set aside and the darkhast must be dismissed with costs throughout."], "relevant_candidates": ["0000034575", "0000257096", "0000724487", "0000863927", "0000979839", "0000990263", "0001064159", "0001142669", "0001279840", "0001290893", "0001419139", "0001443662", "0001624792", "0001800816", "0001822621", "0001905808"]} {"id": "0001925650", "text": ["PETITIONER: Vs. RESPONDENT: TRILOKI DATE OF JUDGMENT: 21/12/1956 BENCH: , T.L. VENKATARAMA BENCH: , T.L. VENKATARAMA BHAGWATI, NATWARLAL H. SINHA, BHUVNESHWAR P. DAS, S.K. CITATION: 1957 AIR 444 1957 SCR 370 ACT: Election Dispute-Petition grounded on corrupt Practices Matter, if of wider import than' Particulars'-Trial', meaning of-Procedure if includes Power's--Amendment, if' and when permissible-Power of Election -Person, when can be said to be employed for Purposes of election-Contract of service and contract for services-Distinction- Representation of the People Act (XLIII of 1951), ss. 81, 83, cls. (1), (2) & (3), 90(2), 92, 123 cls.(7) & (8)-Code of Civil -Procedure (Act V of 1908), 0. VI, r. 17. HEADNOTE: The respondent filed a petition under s. 81 of the Representation of the People Act challenging the election of the appellants to on the ground that they had committed corrupt practices, the material allegations 371 being, (1) that the appellants \" could in the furtherance of their election enlist the support of certain Government servants \", and (2) that the appellant No. 1 had employed two persons in excess of the prescribed number for his election purposes. No list of particulars of corrupt practices under S. 83(2) Of the Act was attached to the petition. Thereafter the respondent applied under s. 83(3) Of the Act for an amendment of his petition by adding the names of certain village Headmen (Mukhias) as having worked for the appellants and later on become their polling agents. allowed the amendment, when a fresh petition on those allegations would have been time-barred, holding that what were sought to be introduced by it were 'mere particulars of the charge already made, and held that corrupt practices under ss. 123(8) and 123(7) had been committed by the appellants. It accordingly declared the election void under S. 100(2)(b) of the Act. It was contended on behalf of the appellants that had no power either under s. 83(3) Of the Act or under 0. VI, r. 17 Of the Code of Civil Procedure to allow the amendment in question and its finding that the appellant No. I had employed the two persons in addition to the prescribed number was misconceived in law. Held, that although the term 'matter' in S. 83(3) was of wider import than 'particulars I to be stated under s. 83(2) and would comprehend the grounds on which the election was sought to be set aside, s. 83(3) was not an exhaustive provision on the power of amendment, its application being limited to allegations of corrupt and illegal practices, and that, therefore, in respect of other matters, the power of amendment under 0. VI, r. 17, read with s. 90(2) of the Act was not excluded, and the maxim expression exclusio alterius, would not apply. The word 'trial' in s. 90 (-2) of the Act is used in a wide sense as including the entire proceedings before the from the time when the petition is transferred to it under s. 86 of the Act till the pronouncement of its award. There is no antithesis between 'procedure' in s. 90(2) and powers' in s. 92 of the Act and Where an. application would lie to the under s. 90(2) it would have' the power to pass, the necessary order on it. The object of the legislature in enacting s. 92 of the Act was to place the powers of the in respect of the matters mentioned therein as distinguished from the other provisions of the Code, on a higher footing. , A.I.R. (1953) Bom. 293, approved. , (1954) S. C. R. 892, referred to. , A. I. R. (1955 Patana Si, disapproved. 372 While had undoubtedly the power under s. 83(3) of the Act to allow an amendment. in respect of any particulars of illegal and corrupt practices, or to permit new instances to be included, provided the grounds or charges were specifically stated in the petition, its power to amend a petition under 0. VI, r. 17 Of the Code of Civil Procedure could not be exercised so as to permit new grounds or charges to be raised or the character of the petition to be so altered as to make it in substance a new petition, when a fresh petition on those allegations would be time- barred. v. , (1869) L. R. 4 C. P. 145; Greenock Election Case, (1869) L. R. 4 C. P. 150 (footnote); Carrickfergus Case, (1869) 1 O'M. & H. 264; Dublin Case, (1869) 1 O'M. & H. 270 and Maude v. , (I 874) L. R. 9 C. P. 165, referred to. , [192O) L. R. 47 1. A. 255, not followed. Held further, that the amendment introduced a new charge, altered the character of the petition and was beyond the powers of the and necessary evidence had not been adduced to support a finding as to the additional employment and no corrupt practices either under cl. (7) or: (8) Of S. I23 had, therefore, been committed. In deciding the question as to whether any person in addition to the number permitted by the Act had been employed by a candidate for his election purposes, the well- established distinction between a contract for services and a contract of service must be borne in mind and in absence of any evidence to show that the contract with the person engaged was one of service,-that he was to do the Work personally, with or without the assistance: of others, lie could not be held to have been employed in law. v. , (1947) K. B. 598 and , (1957)S. C. R. 152, relied on. JUDGMENT: ", "CIVIL APPELLATE JURISDICTION Civil AppEal No.333 of 1956. ", "Appeal by special leave against the judgment and order dated March 23, 1955, of , Lucknow, in Election Petition No. 320 of 1952. ", ", Solicitor General of India, , and , for the appellant. , and , for respondent No. 1. ", "373 ", "1956. December 21. The Judgment of the Court was delivered by is an appeal by special leave against the order of , Faizabad, declaring the election of the appellants to , Uttar Pradesh from the Lucknow Central Constituency, void under s. 100(2)(b) of the Representation of the People Act No. XLIII of 1951, hereinafter referred to as the Act. The Constituency is a double-member Constituency. one of the seats being reserved for a member of the Scheduled Castes. The -polling, took place on 31-1- 1952, and the two appellants we-re declared elected, they having secured the largest number of votes. On -June 10 1952, the respondent herein filed a petition under S. 81 of the Act alleging that the appellants had committed a number of corrupt practices, and prayed that the election might be declared wholly void. ", "The appellants filed written. statements denying these allegations, and on the pleadings, issues were framed on January 17, 1953. Then followed quite 'a spate of proceedings, consisting of applications for framing of fresh issues for better particulars and for amendment of the election petition, to which a more detailed reference will presently be made. As a result of these proceedings, it was not until September, 1954, that the hearing of the petition began On March 23, 1955, the delivered its judgment and, by a majority, it set aside the election on two grounds, (1) that the appellants had obtained the assistance of four village officers, Mukhias, in furtherance of. their election prospects and had thereby contravened s.123(8) of the Act; and (2) that the first appellant had employed for payment in connection with high election two persons in addition to' the number permitted by Rule 118 read with Schedule VI, 'namely, and , and had there by infringed s. 123(7) of the Act. Before us, the appellant's dispute the correctnes's of the conclusions on both these points. ", "As regards the first point, the main contention of the appellants that the charge that they had employed four Mukhias in furtherance of their, election prospects was not pleaded in the petition as originally presented and that it came in only by an amendment dated November 28, 1953, that. the had no power to order that amendment, and that, accordingly, the finding thereon should be disregarded. It is necessary for a correct appreciation of the contentions on either side to state the facts leading to this amendment. ", "The material allegations in the petition as it was presented on June 10, 1952, are contained in para 7(c), and are as follows: ", "\"That the respondents Nos. 1 and 2 could in furtherance of their election enlist the support of certain Government servants. The District Magistrate, Lucknow, organised the opening of eye relief camps, and these functions were utilised for the election propaganda of the respondents Nos. 1 and 2. An eye relief camp was proposed to be opened on December 16, 195 1, at Kakori by Sri , Minister, Civil Supplies, U.P., one of the chief organisers of the election of the respondents Nos. 1 and 2. An election meeting was advertised by the workers of the respondents Nos. I and 2 to be' held within a short distance of the proposed eye relief camp on the same day. This meeting was amongst others addressed by Sri , Chief Minister, U.P., Sri and the respondent No. 1. It was also attended by the Patwaris and of the, Kakori Circle including the , Lucknow and the Duty Superintendent of Police, Lucknow. ", "\"On December 27, 1951, an eye relief camp was similarly. organised and opened at Kakori. The ceremony this time was performed by Mrs. 'and immediately thereafter from the same platform and at the same place election speeches were made and the audience exhorted to vote for Mrs. , a candidate for from that area and respondents Nos. 1 and 2. This meeting was attended -by, the District Magistrate. Lucknow, Sub Divisional Magistrate, Lucknow, Deputy Superintendent of Police, Lucknow, Tahsildar, Lucknow and Patwaris and Qanungo of Kakori Circle. The respondents Nos. I and 2 by this device succeeded in creating an impression on the voters that they had the support of the district officials. There was no list of particulars attached to the petition as provided in s. 83 (2) of the Act. ", "On December 15, 1952, the first appellant filed his written statement, and therein he stated with reference to para 7 ", "(c) that it was \"wrong and denied that the answering respondent in furtherance of his election enlisted the support of any government servant.\" He also stated that the allegations were not accompanied by a list, and were vague and lacking in particulars and were liable to be struck off. The written statement of the second appellant filed on December 20, 1952, was also on the same lines as those of the first appellant. Respondent No. 4, who was' a defeated candidate and supported the respondent herein, filed a written statement on December 3, 1952, wherein he alleged that the appellants had obtained services of village officers, such as Lambardars and Sarpanches in furtherance of their election prospects. Respondent No. 9 who was another defeated candidate also filed a written statement on the same day, adopting the allegations in the statement of the fourth respondent adding to the list of village officials whose assistance was procured by the Appellants. On January 10, 1953, the respondent filed a replication to the written statements of the appellants, wherein he stated as follows \"As stated in the petition, the denial of the respondents Nos. 1 and 2 is absolutely wrong, inasmuch as many Government servants worked for, issued appeals and became polling agents for respondents I and 2. In these meetings at many government servants took part and some worked for furtherance of the election of respondents Nos. I and 2 and issued appeals to the public to vote for respondents Nos. I and 2 and also became their polling agents.\" On January 24, 1953, the appellants filed a written statement objecting to the reception of the replication on the ground that the petitioner (respondent) had no right to file it and that it was a mere device to add to the original petition. They also filed an application on the same date for a preliminary hearing of certain issues relating to the contentions raised by them in their written statements that the allegations in the petition were vague and should be struck off for want of particulars, and the same was posted for hearing on February 25, 1953. Arguments were heard on these issues on that day and again on August 25, 1953, and the following days, and on October 31, 1953, the passed an order striking off some of the allegations in the petition and calling upon the petitioner to give particulars in respect of others. Dealing with para 7 (c) of the petition, the order stated : ", "\" Paragraph 7 (C) is not vague. It shall remain as it is. Corresponding paragraph of the replication introduces some new matters. Therefore, the same shall be disregarded. The Petitioner has not named ,the Government servants. He shall supply the names of the officials including those of the Patwaris and Qanungoes.\" ", "Meantime, after the preliminary argument aforesaid had commenced and before it was concluded, the respondent filed on February 27, 1953, an application for amendment of his petition, the order on which is the main target of attack in this appeal. It was presented under s. 83(3) of the Act, and prayed that the petitioner \" be allowed to amend the details of para 7(c) by adding the words Village Headmen' with their names and the fact that they worked and issued appeal and subsequently they became the -polling agents of respondents Nos. 1 and 2. It mentioned for the first time the names of the Mukhias whose assistance the appellants have been held to have obtained. This application was opposed by -the appellants on the ground that the amendment did not fall within s. 83(3) ,that, the matters sought to be introduced thereby were new charges, and if admitted, they would alter the very character of the petition, and that it should not be granted, as a fresh petition on those allegations would be barred on that date. It should be mentioned that oh January 22, 1953, respondent No. 4 had filed an application to raise additional issues on his averments that the appellants had obtained assistance from the village officers. That application was also contested by the appellants. It would appear that this application and the amendment petition were heard together. On November 10, 1953, the by a majority passed an order dismissing the application of the fourth respondent for additional issues. 'On November 28, 1953, it allowed, again by a majority, the application of the respondent for amendment observing that the matters sought to be introduced were merely particular in respect of the charge set out in par& 7(c) of the petition, \"that the respondents I and 2 could in furtherance of their election enlist the support of certain Government servants\", and further that 0. VI, r. 17 of the Civil Procedure Code was applicable to proceedings before the Election '. ", "The appellants attack the correctness of this conclusion, and contend that the had no power either under s. 83(3) or under 0. VI, r. 171 to order the amendment in question.- They also contend that even if the had the power to order Amendment, the order in question is not justified on the merits, and is erroneous. It is necessary to set out the statutory provisions bearing on the question: S.81(1). An election petition calling in question any election may be presented on one or more grounds specified in sub-ss. (1) and (2) of s. 100 and S. 101 to 'the Election Commission by any candidate at such election or any elector in such form 'and within such time but not earlier than the date of publication of the name or names of the returned candidate or candidates at such I election under s. 67 , as may prescribed. ", "S.83(1). An election petition shall contain a concise statement of the material facts on which the petitioner relies and shall be signed by the petitioner and verified in the manner laid down in the Code of 'Civil Procedure, 1908 (Act V of 1908), for the verification of pleadings. ", "378 ", "(2)The petition shall be accompanied by a list signed and verified in like manner setting forth full particulars of any corrupt or illegal practice which the petitioner alleges, including as full a statement as possible as to the names of the parties alleged to have committed such corrupt or illegal practice and the date and place of commission of each such practice. ", "(3) The may, upon such terms as to costs and otherwise as it may direct at any time, allow the particulars included in the said list to be amended or order such further and better particulars in regard to any matter referred to therein-to be furnished as may in its opinion be necessary for the purpose of ensuring a fair and effectual trial of the petition. ", "85.If the provisions of s. 81 , s. 83 or s. 117 are not complied with, shall dismiss the petition. ", "90 (2). Subject to the provisions of this Act and of any rules made thereunder, every election petition shall be tried by the , as nearly as may be, in accordance with the procedure applicable under the Code of Civil Procedure, 1908 (Act V of 1908), to the trial of suits. 90 (4). Notwithstanding anything' contained in s. 85 , the may dismiss an election petition which does not comply with the provisions of s. 81 ,a. 83 or s. 117 . ", "92.The shall have the powers, which are vested in a court under the Code of Civil Procedure, 1908 (Act V of 1908), when trying a suit in respect of, the following matters: ", "(a) discovery and inspection; ", "(b) enforcing the attendance of witnesses and requiring the depositor their expenses; ", "(c) competing the production of documents; ", "(d) examining witnesses on oath; ", "(e) granting adjournments; ", "(f) reception of evidence taken on affidavit; and ", "(g) issuing commissions for the examination of witnesses, ", "-and may summon and examine suo motu any person whose evidence appears to it to be material; and shall be deemed to be a civil court within the meaning of ss. 480 and 482 of the Code of Criminal Procedure, 1898 (Act V of 1898).\" ", "Now, we start with this that s. 83(3) grants a power to the to amend particulars in a list. What is its scope? Is it open to the acting under this provision to direct new instances of the corrupt practices to be added to the list? And if it is, is that what it did in the present case? It is contended by the learned Solicitor-General on behalf of the appellants that s. 83(3) does not authorize the inclusion of new instances of corrupt practices, and that all that could be ordered under that provision was giving of fuller particulars in respect of instances given in the petition. The argument in, support of this contention might thus be stated: Section 81 requires that the election petition should state the grounds on which it is founded. Section 83(1) enacts that it should contain -a concise statement of the material facts on which the petitioner relies, and s. 83(2) provides that the petition should be accompanied by a list containing full particulars of the corrupt or illegal practices. When the three provisions are read together, it is clear that the legislature has made a distinction between grounds in s. 81(1) , facts ins. 83(1) and full particulars in s. 83(2) ; and in this context, facts in s. 83(1) must mean instances of the charge on which the petition is grounded and the particulars referred to in s. 83(3) can only mean particulars in respect of the instances set out in the petition in accordance with s. 83(1) . The consequence is that an instance of a corrupt practice not given in the petition, cannot be brought in under section 83(3) . On this reasoning, it is contended that the order of the dated November 28, 1953, permitting the respondent to allege that the appellants obtained the assistance of four Mukhias, whose names were mentioned for the first time in the amendment petition, is outside the ambit of the power conferred by s. 83(3) . ", "We are unable to agree with this contention. In I our opinion, s. 81(1) and s. 83 , sub-ss. (1) and (2), when correctly understood, support the contention of the respondent that the has authority to allow an amendment even when that involves inclusion of new instances, provided they relate to a charge contained: in the petition. Taking first s. 81(1) , it enacts that a petition may be presented calling an election in question on one of the grounds specified in a. 100, sub-ss. (1) and (2) and section 101 . These sections enumerate a number of grounds on which the election may be set aside, including the commission of the corrupt practices mentioned in s. 123 of the Act, and quite clearly it is the different categories of Objections mentioned in s. 100 , sub-ss. (1) and (2), S. 101 and s. 123 that constitute the grounds mentioned in s. 81(1) . Then we come to s. 83(1) . It says that the petition should contain a concise statement 'of the material facts, and that would include facts relating to the holding of the election, the result thereof the grounds on which it is sought to be set aside, the right of the petitioner to present the petition and the like. Then s. 83(2) enacts that when there is an allegation of corrupt or illegal practice, particulars thereof' should be given in a separate list. If the grounds on which an election' is sought to be set aside are something other than the commission of corrupt or illegal practices, as for example, when it is stated that the nomination had been wrongly accepted or that the returned candidate was not entitled to stand for election, then s. 83(2) has no application, and the requirements of s. 83(1) are satisfied when the facts relating to those objections are stated. The facts to be stated :under a. 83(1). are thus different from the particulars -which have to be given -under a. 83(2). When# therefore, an election is challenged on the ground that the candidate hag committed the corrupt practices mentioned in section 123 , instances constituteing particulars thereof will properly fall within s. 83(2) and not a. 83(1). The result is that the power under a. 83(3) to allow further and better particulars will include a power to allow fresh instances of the charges,which form the grounds on which the election is Questioned. ", "We are fortified in this conclusion by decisions of English Courts, on statutory provisions which are in pari materia with our enactment. Section 20 of the Parliamentary Elections Act, 1868 enacts that an election petition shall be in such form and state such matters as may be prescribed, that is, by the rules. Rule 2 of the Parliamentary Election Rules provides that the election petition \" shall state the holding and result of the election and shall briefly state the facts and grounds relied on to sustain the prayer \". Rule 5 gives the form of an election petition and the third paragraph therein is as follows. ", "\" And your petitioners say (here state the facts and grounds on which the petitioners rely).\" ", "The true scope of these Provisions came up for consideration in v. (1). There, the election petition merely stated that \" the respondent by himself and other. person.% on his behalf, was guilty if bribery, treating and undue influence.\" The respondent took out an application for an order that the petition be taken off the file on the ground that it merely stated the grounds but not the facts constituting the particulars as required by Rule 2. In the alternative, it was prayed that the petitioners should be directed to give particulars relating to the several corrupt practices. In rejecting the former prayer, observed: ", "\" Now, with regard to the form of the petition, it seems to me that it sufficiently follows the spirit and intention of the rules; and no injustice can be done by its generality, because ample provision is made by the rules to prevent the respondent being surprised or deprived of an opportunity of a fair trial, by an order for such particulars as the judge may deem reasonable. I think, therefore, it would be quite useless to require anything further to be stated in the petition than appears here.\" ", "With reference to the alternative prayer, it was held that an order that the particulars be furnished three days prior to the trial was a proper one to be passed. A similar decision was given in the Greenoch Election Case, a report of which is given in a footnote at page 150 of v. (1)(1869) L. R. 4 C- P.145. ", "382 ", "These decisions establish that the requirement as to statement of grounds and facts is satisfied when the charge on which the election is sought to be set aside is set out in the petition, that the fare to give therein particulars of corrupt and illegal practices on which it is founded is not fatal to its maintainability, and that it is sufficient if the particulars are ordered to be furnished within a reasonable time before the commencement of the trial. On the same reasoning, the conclusion should follow that s. 81 (1) and a. 83 (1) are complied with, when the grounds on which the election is sought to be set aside, are stated in the petition, those grounds being, as already stated, the matters mentioned in s. 100 , sub-ss. (1) and (2), s. 101 and s. 123, which is attracted by s. 100 (2) (b), and that the particulars in respect of those grounds, when they are charges of corrupt or illegal practices, fall within s. 83 (2). There is, it should be observed, nothing in the Election law of England corresponding to s. 83 (2), the question of particulars being left there to be dealt with under the Rules applicable to the trial of causes. The consequence is that while under the English practice, the petitioners are not obliged to state particulars of corrupt practices in their petition, under s. 83 (2) a statement of those particulars must be made in the petition in a separate list annexed thereto. But this difference is more a matter of form than of substance, as s. 83 (3) provides for particulars being called for and furnished in the course of the proceedings, and does not affect the conclusion as to the power of the to allow new instances to be pleaded. ", "Section 83 (3) provides, it should also be noted, for the list of particulars being amended or enlarged. It is not, however, to be inferred from this that when the particulars are mentioned in the body of the petition, they could not be amended. The reference to the list, in a. 83 (3) must be taken along with the provision in s. 83 (2) that particulars are to be set out in a list to be attached to the petition. The substance of the matter, therefore, is that under s. 83 (3) particulars can be amended and supplemented, and the reason of it requires that the power could be exercised even when the particulars are contained in the body of the petition. And even when there is no list filed, as in the present case, it would be competent to the to allow an amendment giving for the first time instances of corrupt practice, provided such corrupt practice has been made a ground of attack in the petition. ", "One other argument urged by the appellants against this conclusion must now be considered. It is based on the language of s. 83(3) . That section, it is urged, allows firstly by an amendment of the particulars. included in the list, and secondly \" further and better particulars in regard to any matters referred to therein\" and that, according to the appellants, means the particulars already given in the list. it is accordingly contended that the power to allow further and better particulars can be exercised only in respect of particulars already furnished, whether they be contained in the body of the petition or in the list, and that, therefore, an order permitting inclusion of new instances is outside the purview of s. 83(3) . The assumption underlying this contention is that the word \"matter\" in s. 83 (3) means the same thing as \"particulars\". We see no reason why we should put this narrow construction on the word \"matter\". That word is, in our opinion, of wider import than particulars, and would also comprehend the grounds on which the election is sought to be set aside. If the construction contended for by the appellant is correct, the relevant portion of s. 83 (3) will read as \" further and better particulars in regard to any particulars referred to therein\", and that does not appear to us to be either a natural or a reasonable reading of the enactment. Having regard to the scheme of the Act stated above, we think that s. 83 (3) is intended to clothe the with a general power to allow not merely an amendment of particulars already given but also inclusion of fresh particulars, pleading new instances, subject to the condition that they are in respect of a ground set out in the petition. This is in accordance with the law and practice obtaining in in England. Thus,in the Carrickfergus Case (1), in ordering (1) 1 O'M. & H. 264, 265. ", "50 ", "384 ", "an application for amending particulars, so as to include matters which had only then come to the knowledge of the petitioner, , J., observed : ", "\" In some respects the Petitioner came down here manifestly ignorant of the exact grounds upon which several of the charges of the Petition were founded. ", "\" I therefore thought it reasonable upon a proper case being made out to allow the Petitioner to amend his bill of particulars by adding such facts as only -recently came to his knowledge. I consider that in the trial of these petitions, where the purity of the election is questioned, the most searching enquiry should be instituted, and it is the duty of the Judge to afford every facility in his power to that investigation.\" ", "In the Dublin Case (1), the order was one directing a list. of particulars to be amended, the Court observing: \" I shall allow the utmost 'latitude to amend, unless it is a case in which I see that the party kept back information at the time the list was furnished.\" ", "In this view, the order of amendment in question is not open to attack on the ground that it has permitted new instances to be raised. What has to be seen is whether those instances are, in fact, particulars in respect of a ground put forward in the petition, or whether they are, in substance, new grounds of attack. ", "Before dealing with this question, it will be convenient to consider the alternative contention raised for the respondent -that even if the had no power to order the amendment in question under s. 83 (3) of the Act, it was competent to do so under o. VI, r. 17, Civil Procedure Code, and that this should not in special appeal interfere with the discretion exercised by it in making the order. That raises the question which has been very much debated both in the Election s and in the High s of the States as to whether 0. VI, r. 17 applies to proceedings before Election s. Mr. , learned counsel for the respondent, contends that it does, by force of s. 90 (2) of the Act, under which the is to try a petition \"as (1) 1 O'M. & H. 270, 272. ", "385 ", "nearly as may be in accordance with the procedure applicable under the Code of Civil Procedure, 1908, to the trial of suits.\" Now, in A. G. v. (1) it was stated by Lord that the word \"practice\"and it means, as observed in V. Mixors (2) the same - thing as procedure- denotes \" the rules that make or guide the Curcus cirise, and regulate the proceedings ina cause within the walls or limits of the itself \". And these proceedings include all ,steps, which might be taken in the prosecution or defence thereof, including an application for amendment. In v. (3), the point arose for decision whether the power conferred on the Election by s. 21(5) of the Corrupt Practices (Municipal Elections) Act, 1872, to try the petition, subject to the provisions of the Act, as if it were a cause within its jurisdiction, carried with it a power to order amendment of the petition. It was held that it did. That precisely is the point here. ", "But it is contended for the appellants that 0. VI, r. 17 cannot be held to apply to proceedings before the by reason of s. 90 (2), because (1) under that section, it is only the trial of the election petition that has to be in accordance with the provisions of the Civil Procedure Code, and the question of amendment of the petition relates to a stage anterior to the trial;(2) s. 92 enumerates certain matters in respect of which the is to have the powers of a court under the Civil Procedure Code, and as amendment of pleadings is not one of them, 0. VI, r. 17 must be held to have been excluded from its jurisdiction; (3) the Act makes a distinction between procedure and powers, s. 90 (2) extends the provisions of the Civil Procedure Code to proceedings before s only in respect of procedure, and power to order amendment under 0. VI, r. 17 is not within the extension; and (4) s. 90(2) is, in any event, subject to the provisions of the Act and the rules made thereunder, and the power of amendment under s. 83 (3) being limited to particulars, the (1) 10 H.L.C. 704,723; II E.R. 1200, 12O9. (2) 7 Q.B.D. 329,333. ", "(3) (1874) L.R. 9 CP. 165. 172. ", " ", "general power of amendment under 0. VI, r. 17 must be held to have been excluded. The correctness of these contentions must now be examined. ", "(1)Taking the first contention, the point for decision is as to what the word 'trial' in s. 90 (2) means. According to the appellants, it must be understood in a limited sense, as meaning the final hearing of the petition, consisting of examination of witnesses, filing documents and addressing arguments. According to the respondent, it connotes the entire proceedings before the from the time that the petition is transferred to it under s. 86 of the Act until the pronouncement of the award. While the word' trial' standing by itself is susceptible of both the narrow and the wider senses indicated above, the question is, what meaning attaches to it in s. 90 (2), and to decide that we must have regard to the context and the setting of the enactment. Now, the provisions of the Act leave us in no doubt as to in what sense the word is used in s. 90(2) . It occurs in Chapter III which is headed \" Trial of election petitions \". Section 86 (4) provides that if during the course of the trial any member of a is unable to perform his functions, is to appoint another member, and thereupon the trial is to be continued. This provision must apply to retirement or relinquishment by a member, even before the hearing commences, and the expression \" during the course of the trial \" must therefore include the stages prior to the hearing. Section 88 again provides that the trial is to be held at such places as may appoint. The trial here must necessarily include the matters preliminary to the hearing such as the settlement of issues, issuing directions and the like. After the petition is transferred to the Election under s. 86 ,, various steps have to be taken before the stage can be set for hearing it. The respondent has to file his written statement ; issues have to be settled. If 'trial' for the purpose of s. 90(2) is to be interpreted as meaning only the hearing, then what is the provision of law under which the is to call for written statements and settle issues ? Section 90(4) enacts that when an election petition does not comply with the provisions of s. 81, s. 83 or s. 117 , the may dismiss it. But if it does not dismiss it, it must necessarily have the powers to order rectification of the defecte arising by reason of non-compliance with the requirements of s. 81 , s. 83 or section 117 . That not being a power expressly conferred on it under s. 92 can only be sought under 'Is. 90(2), and resort to that section can be had only if trial is understood as including proceedings prior to hearing. Section 92 enacts that the shall have powers in respect of various matters which are vested in a court under the Civil Procedure Code when trying a suit, and among the matters set out therein are discovery and inspection, enforcing attendance of 'witnesses and compelling the production of documents, which clearly do not form part of the hearing but precede it. In our opinion, the provisions of Chapter III read as a whole, clearly show that 'trial' is used as meaning the entire proceedings before the from the time when the petition is transferred to it under s. 86 until the pronouncement of the award. ", "(2)The second contention urged on behalf of the appellants is that if the provisions of the Civil Procedure Code are held to be applicable in their entirety to the trial of election petitions, then there was no need to provide under s. 92 that the was to have the powers of courts under the Code of Civil Procedure in respect of the matters mentioned therein, as those powers would pass to it under s. 90(2) . But this argument overlooks that the scope of s. 90 (2) is in a material particular different from that of s. ", "92. While under s. 90(2) the provisions of the Civil Procedure Code are applicable only subject to the provisions of the Act and the rules made thereunder, there is no such limitation as regards the powers conferred by s. 92 . It was obviously the intention of the legislature to put the powers of the in respect of the matters mentioned in s. 92 as distinguished from the other provisions of the Code on a higher pedestal, and as observed in v. (1), they are (1) A.I.R. BOM. 293. ", "388 ", "the irreducible minimum which the is to possess. (3) It is then argued that s. 92 confers powers on the in respect of certain matters, while s. 90(2) applies the Civil Procedure Code in respect of matters relating to procedure, that there is a distinction between power and procedure, and that the granting of amendment being a power and not a matter of procedure, it can be claimed only under s. 92 and not under a. 90(2). We do not see any antithesis between procedure' in s. 90(2) and 'powers' under s. 92 . When the respondent applied to the for amendment, he took a procedural step, and that, he was clearly entitled to do under s. 90(2) . The question of power arises only with reference to the order to be passed on the petition by the . Is it to be held that the presentation of a petition is competent, but the passing of any order thereon is not? We are of opinion that there is no substance in this contention either. (4) The last contention is based on the provision in s. 90(2) that the procedure prescribed in the Code of Civil Procedure is to apply subject to the provisions of the Act and the Rules. It is argued that s. 83(3) is a special provision relating to amendments, -and that it must be construed as excluding 0. VI, r. 17. The result, according to the appellants, is that if an amendment could not be ordered under s. 83(3) , it could not be ordered under 0. VI, r. 17. This contention appears to us to be wholly untenable. The true scope of the limitation enacted in s. 90(2) on the application of the procedure under the Civil Procedure Code is that when the same subject-matter is covered both by a provision of the Act or the rules and also of the Civil Procedure Code, and there is a conflict between them, the former is to prevail over the latter. This limitation cannot operate, when the subject-matter of the two provisions is not the same. Section 83(3) relates only to amendment of particulars, and when the amendment sought is one of particulars, that section will apply to the exclusion of any rule of the Civil Procedure Code which might conflict with it, though it does not appear that there is any such rule. But where the amendment relatesnot to particulars but to other matters, that is a field not occupied by s. 83(3) , and 0 . VI, r. 17 will apply.The fallacy in the argument of the appellants lies in the assumption that s. 83(3) is a comprehensive enactment on the whole subject of amendment, which it clearly is not. In this view, there is no scope for the application of the maxim, expressio unius exclusio alterius, on which the appellants rely. It should be mentioned that the provision in s. 83(2) for stating the particulars separately in a list attached to the petition is one peculiar to the Indian Statute, and the legislature might have considered it desirable ex abundanti cautela to provide for a power of amendment in respect thereto. To such a situation, the maxim quoted above has no application. In Maxwell on Interpretation of Statutes, Tenth Edition, pages 316-317, the position is thus stated : ", "\" Provisions sometimes found in statutes, enacting imperfectly or for particular cases only that which was already and more widely the law, have occasionally furnished ground for the contention that an intention to alter the general law was to be inferred from the partial or limited enactment, resting on the maxim expressio unius, exclusio alterius. But that maxim is inapplicable in such cases. The only inference which a court can draw from such superfluous provisions (which generally find a place in Acts to meet unfounded objections and idle doubts), is that the legislature was either ignorant or unmindful of the real state of the law, or that it acted under the influence of excessive caution.\" ", "Vide also Halsbury's Laws of England, Hailsham's Edition, Volume 31, page 506, para 651. We are accordingly of opinion that the application of 0. VI, r. 17, Civil Procdure Code to the -proceedings before the is not excluded by a. 83(3). ", "Turning next to the authorities, the decision of this Court in (1) goes far to conclude the question in favour of the respondent. In that case, a petition to set aside an election was filed without impleading one of the candidates, , (1) S.C.R. 892, who had been nominated but had withdrawn -from the contest. That was against s. 82 of the Act. The respondent then applied for an order dismissing the petition on the ground that it could not go on in the absence of . The held on this petition that the non-joinder of was not fatal to the maintainability of the petition, and passed an order directing him to be impleaded. This order was challenged on the ground that there was no power in the to order a new party to be impleaded. But this Court repelled this contention, and held on a review of the provisions of the Act including s. 90(2) that the had the power to pass the order in question under 0. 1, rr. 9, 10 and 13. This is direct authority for the position that trial for purposes of s. 90(2) includes the stages prior to the hearing of the petition, and the word I procedure' therein includes power to pass orders in respect of matters not enumerated in s. 92 . In v. (1) it was held that 'Procedure' in s. 90(2) and I powers' in s. 92 were interchangeable terms, that the procedure applicable under s. 90(2) was wider than what would be applicable to the hearing of a. suit, and that the had power in a proper case to order amendment of a petition. (2), it was held that the application of 0. VI, r. 17 to proceedings before the was excluded by section 83(3) of the Act. For the reasons already given, we are unable to agree with this view. We are of opinion that the law was correctly laid down in v. (1), and in agreement with it, we hold that the has power in appropriate cases to direct amendment of the petition under, O. VI, r. 17. ", "It is next contended for the appellants that even if s.83(3) does not exclude the application of 0. VI, r. 17 to the proceedings before the , the exercise of the power under that rule must, nevertheless, be subject to the conditions prescribed by a. 81 for presentation of an election petition, that one of those conditions was that it should be presented within the (1) A.I.R. [1953] Bom. 293. ", "(2) A.I.R. [1955] Patna 81. ", "391 ", "time allowed therefor, and that accordingly no amendment should be allowed which would have the effect of defeating that provision. The decisions in v. (1) and and others v. (1) are relied on in support of this contention. In v. (1), the facts were that an election petition was filed alleging that the successful candidate had employed as paid canvassers residents of the ward, and that the election was, in consequence, void. Then an application was filed for amending the petition by alleging that residents of other wards were also similarly employed, and that was ordered by Baron . The correctness of this order was questioned on the ground that on the date of the application for amendment a fresh petition on those allegations would be barred, and that therefore the had no jurisdiction to pass the order which it did. In upholding this contention, Lord observed that section 21(5) gave power to the to amend the petition, that that power was subject to the provisions of the Act, that one of those provisions was s. 13(2) , which prescribed- the period within which an election petition could be filed, that the power of amendment could be exercised only subject to this provision, and that accordingly an amendment which raised a new charge should be rejected if a fresh petition on that charge would be barred on that date. He also observed that the matter was not one of discretion but of jurisdiction. This was followed in v. (3). In and others v. (2) the application was to amend the petition by adding a new charge, and it was held tha that could not be done after the expiry -of the period of limitation fixed in the Act for filing an election petition, and the decision was put on the ground that the power to grant amendment was \" subject to the provisions of the Act.\" ", "On these authorities, it is contended for the appellants that even if the is held to possess a power to order amendments generally under 0. VI, (1) [1874] L.R. 9 C.P. 165. (3) (1883) 52 L.J.Q.B. ", "321. (2) (1885-86) 2 Times Law Reports 273. ", "392 ", "r. 17, an order under that Rule cannot be made when a new ground or charge is raised, if the application is made beyond the period of limitation prescribed for filing election petitions. The sought to get over this difficulty by relying on the principle well established with reference to amendments under 0. VI, r. 17 that the fact that a suit on the claim sought to be raised would be barred on the date of the application would be a material element in deciding whether it should be allowed or not but would not affect the jurisdiction of the court to grant it in exceptional circumstances as laid down in (1). But this is to ignore the restriction imposed by s. 90(2) that the procedure of the under the Code of Civil Procedure in which 0. VI, r. 17 is comprised, is to apply subject to the provisions of the Act, and the rules, and there being no power conferred on the to extend the period of limitation prescribed, an order of amendment permitting a new ground to be raised beyond the time limited by s. 81 and r. 119 must contravene those provisions and is, in consequence, beyond the ambit of authority conferred by s. 90(2). We are accordingly of opinion that the contention of the appellants on this point is well-founded, and must be accepted as correct. ", "The result of the foregoing discussion may thus be summed up: ", "(1)Under s. 83(3) the has power to allow particulars in respect of illegal or corrupt practices to be amended, provided the petition itself specifies the grounds or charges, and this power extends to permitting new instances to be given. ", "(2)The has power under 0. VI, r. 17 to order amendment of a petition, but that power cannot be exercised so as to permit new grounds or charges to be raised or to so alter its character as to make it in substance a new petition, if a fresh petition on those allegations will then be barred. ", "We have now to decide whether on the principles stated above, the order of amendment dated November 28, 1953, was right and within the competence of (1)[1920] L.R. 47 I.A. 255. ", "393 ", "the . To decide that, we must examine whether what the respondent sought to raise by way of amendment was only particulars in respect of a charge laid in the petition, or whether it was a new charge. The paragraph in the petition relevant to the present question is 7(c), and that has been already set out in extenso. Leaving out the allegations relating to the meetings held at , what remain of it is only the allegation that \" respondents I and 2 could in furtherance of their election enlist the support of Government servants.\" The word \" could \" can only mean that the respondents were in a position to enlist the support of Government servants. It does not amount to an averment that, in fact, they so enlisted their support. It is argued for the respondent that the allegation in para 7(c) really ", "-means that the appellants had, in fact, enlisted the support of servants, and that that amounts to a charge under s. 123(8) of the Act of procuring the assistance of - servants for furtherance of their election prospects. Why then does the petition not state it in plain terms ? The difference between \"could\" and \"did\" is too elementary to be mistaken. The respondent has in other paragraphs relating to other charges clearly and categorically asserted what the appellants did and what their agents did. And why was a different phraseology adopted in para 7(c) 9 It is to be noted that apart from this allegation, the rest of the paragraph is taken up with details of the two meetings at , and it winds up with the following allegation: ", "\" The respondents 1 and 2 by this device succeeded in creating an impression on the voters that they had the support of the District officials.\" ", "This suggests that the charge which the respondent sought to level against the appellants was that they moved in public so closely with high dignitaries as to create in the minds of the voters the impression that they were favoured by them. We are unable to read into the allegations in para 7(c) as originally framed any clear and categorical statement of a charge under s. 123(8), or indeed under any of the provisions of the Election law. ", "The respondent does not dispute that the language in which the allegation in para 7(c) is couched does not import that any corrupt practice had, in fact, been committed, but he contends that this defect is merely one of expression, and that the appellants had understood it correctly as meaning commission of corrupt practices by them, which is what the respondent meant to assert. It is no doubt true that plead- ings should not be too strictly construed, and that regard should be had to the substance of the matter and not the form. Even so, what, in substance, is the charge which could be gathered from a general and vague allegation that the appellants \" could \" enlist the support of Government officials ? It should not be forgotten that charges of corrupt practices are quasi-criminal in character, and that the allegations relating thereto must be sufficiently clear and precise to bring home the charges to the candidates; and judged by that standard, the allegation in para 7(c) is thoroughly worthless. The contention of the respondent that the appellants understood the allegation as meaning that they had committed corrupt practices, is not borne out by the record. In the application which the appellants filed on January 24, 1953, for trial of certain questions as preliminary issues, they stated in para 7 as follows: \"Para 7(c). The allegation contained in this para is vague and indefinite. It nowhere alleges that the respondent nos. 1 and 2 obtained or procured or abetted, or attempted to obtain or procure the assistance of any government servants. No list given.\" ", "And again, in the objection filed by the appellants to the application of the respondent for amendment, they stated that it was doubtful whether even the original allegation in para 7(c) amounted to a major corrupt practice within s. 123(8) of the Act. The does not deal with this aspect of the matter and simply assumes that the petition as presented did raise a charge under s. 123(8) . We are of opinion that this assumption is erroneous and that its finding is vitiated thereby. ", "But even if we are to read \" could \" in para 7(c) as meaning \" did \", it is difficult to extract out of it a charge under s. 123(8). The allegation is not clear whether the servants were asked by the appellants to support their candidature, or whether they were asked to assist them in furtherance of their election prospects, and there is no allegation at all that the servants did, in fact, assist the appellants in the election. On these allegations, it is difficult to hold that the petition in fact raised a charge under s. 123(8) . It is a long jump from the petition as originally laid to the present amendment, wherein for the first time it is asserted that certain no are mentioned in the petition assisted the appellants in furtherance of their election prospects, and that thereby the corrupt practice mentioned in s. 123(8) had been committed. The new matters introduced by the amendment so radically alter the character of the petition as originally framed as to make it practically a new petition, and it was not within the power of the to allow an amendment of that kind. Counsel for the appellants also contended that even if the had the power under 0. VI, r. 17 to permit an amendment raising a new charge, it did not under the circumstances exercise a sound and judicial discretion in permitting the amendment in question. There is considerable force in this contention. The election petition was filed on June 10, 1952, which was the last date allowed under a. 81 and r. 119. It contained in para 7(c) only the bare bones of a charge under a. 123(8), assuming that it could be spelt out of it. Nothing further is heard of this charge, until we come to December, 1952, when respondents 4 and 9 who sailed with the petitioner, -filed statements alleging that the appellants had obtained the assistance from servants including in furtherance of their election prospects. On January 16, 1953, the respondent herein filed a replication in which he sought to weave the above allegations into the fabric of his petition, but the result was a mere patchwork. It should be mentioned that there is no provision of law under which a replication could be filed as a matter of right, nor was there an order of the allowing it. On February 25, 1953, the appellants opened their arguments at the hearing of the preliminary issue, and thereafter, with a view to remedy the defects which must have been then pointed out, the respondent filed his present application for amendment. Even that was defective, and had to be again amended. And what is remarkable about this application is that no at tempt was made to explain why it was made after such long delay and why the new allegations were not made in the original petition. The position taken up by the respondents was that the amendment only made express what was implicit in para 7(c). The was of opinion that notwithstanding all these features, the amendment should be allowed as it was in the interests of the public that purity of elections should be maintained. But then, public interests equally demand that election disputes should be determined with despatch. That is the reason why a special jurisdiction is created and s are constituted for the trial of election petitions. Vide the observations of Lord in v. (1). ", "In the present case, having regard to the circumstances stated above, the order of amendment would be open to grave criticism even if it had been made in an ordinary litigation, and in an election matter, it is indefensible. The strongest point in favour of the respondent is that we should not in special appeal interfere with what is a matter of discretion with the . It is not necessary to pursue this matter further, as we are of opinion that the order of amendment dated November 28, 1953, is, for the reasons already stated. beyond the powers of the , and therefore must be set aside and the finding based on that amendment that the appellants had committed the corrupt practice mentioned in s. 123(8) of the Act must be reversed. In this view, it becomes unnecessary (1) A.C. 640. ", "397 ", "to deal with the further contention of the appellants that there is no legal evidence in support of the finding of the that they had obtained the assistance of four Mukhias in furtherance of their election prospects. Then there is the question whether the first -appellant has, as held by the , again by a majority, contravened s. 123(7) of the Act. The facts found are that one was engaged by the first appellant to prepare three carbon copies of the Electoral Rolls and was paid Rs. 550/- at the rate of Re. 0-8-0 per hundred voters and likwise, one was engaged to enter the names of the voters in printed cards and was paid Rs. 275/- at Re. 0-4-0 per hundred cards. Both these are undoubtedly expenses incurred in connection with the election and have, in fact, been shown by the first appellant in the return of election expenses against column K. Now the contention of the respondent which has found favour with the is that both and must be held to have been employed for payment in connection with the election, and as with their addition, the, number of persons allowed to be employed under Schedule VI has been exceeded, the corrupt practice mentioned in s. 123(7) of the Act has been committed. It is contended by the Solicitor-General that on the facts found and cannot be said to have been employed by the first appellant,and that the conclusion of the to the contrary is based on a misconception of law. Now' whether a person is an employee or not is a question of fact, and if there had been any evidence in support of it, this Court would not interfere with the finding in special appeal. But the respondent, on whom the burden lies of establishing contravention of r. 118, has adduced no evidence whatsoever, and all that is on record is what the first appellant deposed while he was in the box. He merely stated that and were asked to do the work on, contract basis. That is wholly insufficient to establish that there was a contract of employment of those persons by him. It was argued for the respondent that there could be a contract of employment in respect of piece-work as of time-work, and that the evidence of the first appellant was material on which the could come to the conclusion to which it did. It may be conceded that a contract of employment may be in respect of either piece-work or time-work; but it does not follow from the fact that the contract is for piece-work that it must be a contract of employment. There is in law a well- established distinction between a contract for services, and a contract of service, and it was thus stated in v. (1): ", "In the one case the master can order or require what is to be done while in the other case he can not only order or require what is to be done but how it shall be done.\" This Court had occasion to go into this question somewhat fully in (2) , and it was there held that the real test for deciding whether the contract was one of employment was to find out whether the agreement was for the personal labour of the person engaged, and that if that was so, the contract was one of employment, whether the work was time- work or piece-work or whether the employee did the whole of the work himself or whether he obtained the assistance of other persons also for the work. Therefore, before it could be held that and were employed by the first appellant, it must be shown that the contract with them was that they should personally do the work, with or without the assistance of other persons. But such evidence is totally lacking, and the finding, therefore, that they had been employed by the first appellant must be set aside as based on no evidence. ", "Neither of the grounds on which the election of the appellants has been declared void, could be supported. We must accordingly allow the appeal, set aside the order of the and dismiss the election petition filed by the respondent, with costs of the appellants throughout. Appeal allowed. ", "Election petition dismissed. ", "(1) [1947] K.B. 598, 615. (2) [1957] S.C.R. 152. ", "399"], "relevant_candidates": ["0001209054", "0001292810", "0001451476", "0001694314", "0001996477"]} {"id": "0001949249", "text": ["PETITIONER: CONTROLLER OF ESTATE DUTY, Vs. RESPONDENT: C. R. RAMACHANDRA GOUNDER DATE OF JUDGMENT27/02/1973 BENCH: , P. JAGANMOHAN BENCH: , P. JAGANMOHAN HEGDE, K.S. KHANNA, HANS RAJ CITATION: 1973 AIR 1170 1973 SCR (3) 554 1973 SCC (4) 102 CITATOR INFO : F 1973 SC2598 (2) E 1975 SC 435 (10,17,18) F 1977 SC 463 (20,23) APL 1980 SC 142 (10,13) RF 1986 SC 631 (5) F 1988 SC1426 (11) ACT: Estate Duty Act , s. 10-Scope of. HEADNOTE: The father of the respondent Was a partner in a firm. He owned property which the firm was occupying as a tenant at will. In 1953 he executed a deed of settlement under which he transferred that property to two of his sons absolutely and irrevocably. After the transfer the firm continued as tenant paying rent to the two donees by crediting each of their accounts in the account books of the firm in equal shares. The father also wrote, to the firm to transfer from his account five sums of Rs. 20,000 each with effect from April, 1953, to the credit of his five sons in the firms books. The sons did not withdraw any amount from their accounts in the firm and the amounts continued to be invested in the firm for which interest at 7 1/22% per annum was paid to them. The father continued to, be a partner of the firm even after the transfer fill 1957. when the firm was dissolved. On his death thereafter the property leased out to the firm which was transferred to two of his son,-, as well as Rupees one lakh gifted to the five sons, were sought to be included in the estate of the deceased on the ground that the donees bad not been. in possession and enjoyment of the subject matter of the gifts to the entire exclusion of the donor within the meaning of s. 10 of the Estate Duty Act, 1953. , on reference, held against the . Dismissing the appeal to this Court. HELD : Neither the property gifted to the donees nor the amount of Rs. 1 lakh, gifted to the five sons could be included in the estate of the deceased. [81A-B] Section 10 consists of two conditions, namely, (1) the donee must bona fide have assumed possession 'and enjoyment of the property which is the subject matter of the gift to the exclusion of the donor immediately upon the gift and (2) the donee must have retained such possession and enjoyment of the property to the entire exclusion of the donor or of any benefit to him by contract or otherwise; and unless both are satisfied the property would be liable to Estate duty. The second part of the section has two limbs, namely, the deceased must be entirely excluded,, (a) from the property, and (b) from any benefit by contract or otherwise. The word \"otherwise\" must be construed ejusdem generis and it must be interpreted to mean some kind of legal obligation or some transaction enforceable at law. or in equity, which, though not in the form of a contract, may confer a benefit on the donor. [557 F-H. 558A-C] In the present case, the first two conditions are satisfied because of the unequivocal transfer of the properties and the last limb of the condition relating to any benefit to the donor by contract or otherwise is inapplicable. The donor, on the date when he gifted the property which was leased out to the firm, had two rights, namely, ownership in the property and right to terminate the tenancy and obtain posses- 555 () sign thereof. He has transferred the ownership and has given such possession as the circumstances and the nature of the property admit. It could not be said that since the donor was a partner in the firm which had taken the property on lease, he derived benefit therefrom and was therefore not entirely excluded from the possession and enjoyment thereof The benefit the donor had as a member of the partnership was not a benefit referable in any way to the gift but is unconnected therewith. [558C- , 63 I.T.R 497, followed. Munro and Others v. Commissioner of Stamp Duties, A.C. 61, and Another v. Commissioner of Stamp Duties, 37 I.T.R. (E.D.) 89 and Commissioner of Stamp Duties of New South Wales v. , A.C. 425, referred to. , 72 I.T.R. 29, approved. JUDGMENT: ", "CIVIL APPELLATE JURISDICTION : Civil Appeal No. 1391 of 1970. ", "Appeal by certificate from the judgment and order dated November 25, 1968 of in Tax Case No. 103 of 1965. ", ", and , for the Appellant. ", ", for the respondent. ", "The Judgment of the Court was delivered by , J.-This appeal is by certificate against the judgment of , which has answered the following two questions referred to it, in favour of the assessee and against the : ", "(1) Whether on the facts and in the circumstances of the case the was right in law in holding that the house property in Avanashi Road, Coimbatore, is not liable to estate duty as property deemed to pass on the death of the deceased under section 10 of the Estate Duty Act, 1953 ? ", "(2) Whether on the facts and in the circu mstances of the case, the was right in law in holding that the sum of Rs. 1 lakh gifted by the deceased to his sons in 1953 is not liable to estate duty as property deemed to pass on the death of the deceased under section 10 of the Estate Duty Act, 1953 ? ", "556 ", "These questions arose on the facts set out in the statement of the case which are : one was a partner in the firm called , Coimbatore. He owned property which. the firm was occupying as tenant-at- will. In August 1953. he executed a deed of settlement under which he transferred the property leased out to the firm to his two sons and , absolutely and irrevocably. After this transfer, the firm continued to be in occupation of the premises paying rent thereof at Rs. 300/- p.m. to the two donees by crediting each of their accounts in the account books of the firm in equal shares. lit may be mentioned that the father continued to be a partner of the firm even after the transfer till April 13, 1957, when the firm was dissolved. He had also an account with the firm , and on March 30, 1953, he requested the firm by a letter to transfer from his account five sums of Rs. 20,000/- each with effect from April 1, 1953 to the credit of his five sons in the firm's books. He also wrote to the live sons informing them of the transfer. Though the sons did not withdraw any amount from their accounts in the firm, the amounts continued to be invested in the firm for which interest at 7 1/2% per annum was paid to them. ", "On the death of on May 5, 1957, the Assis- tant Controller of Estate Duty, included in the estate of the deceased, the property leased out to the firm which was transferred to his two sons. According to him, possession and enjoyment of the subject-matter of the gift had not been assumed by the nor had they retained possession thereof to the 'entire exclusion of the donor, inasmuch as the partnership in which the donor was a partner with other parties, continued to be in possession and enjoyment of the gifted property as tenants at will of the . With respect to the gift of Rs. 1 lakh to the five sons of the, deceased, the Assistant Controller held that the had not been. in possession and enjoyment. of the subject-matter of the gift to the entire exclusion of the donor within the meaning of S. 10 of the Estate Duty Act. He, therefore, included this sum of Rs. 1 lakh in the principal value of the estate of the deceased. ", "The accountable persons appealed to the Appellate Controller who confirmed the said inclusion. The on a further appeal, however, disagreed with the findings of the Assistant Controller and the Appellate Controller. It held that the firm, of which the deceased was a partner occupied the property but that such interest was not as owner of the property, and therefore, the gift had been made without the donor retaining any interest, as much it could not be included in the estate of the deceased under S. 10 of the Estate Duty Act. It further held that the sum of Rs. 1 lakh gifted to the sons was given by the sons to the firm which had benefit of the money and that the father could not be said to have enjoyed the benefit of the money as partner of the firm. In this view, the excluded the sum of Rs. 3 lakh from the estate of the deceased. agreed with these findings. ", "It is contended before us by the learned Advocate for the Revenue that both the and were in err-or in holding that the property as well as the sum of Rs. 1 lakh were enjoyed by the donees to the exclusion of the donor or that the deceased did not derive 'benefit therefrom within the meaning of s. 10 of the Estate Duty Act, because, firstly, the donor was ;a partner in the firm which had occupied the property as tenants-at-will even after the gift, and secondly, the amount of Rs. 1 lakh, though entered in each of the accounts of the donor's five sons in the books 'of the firm, was not utilised or enjoyed by them in any manner. Section 10 of the Estate Duty Act, as, in force on the date of the death of the deceased, was as follows \"10. Property taken under any gift, whenever made, shall be deemed to pass on the donor's death to the extent that bona fide possession and enjoyment of it was not immediately assumed by the donee and thenceforward retained to the entire exclusion of-the donor of any benefit to him by contract or otherwise; ", "\"Provided that the property shall not be deemed to pass by reason only that it was not, as from the date of the gift, exclusively retained as; aforesaid, if, 'by means of the surrender of the reserved benefit or otherwise, it is subsequently enjoyed to the entire exclusion of the donor or of any benefit to him for at least two years before the death :............ ", "The crux of the above section as pointed out by this Court, in . ,(1) lies'. in two parts : (1) the donee must bona fide have assumed possession and enjoyment of the property which is the subject-matter of the gift to the exclusion of the donor, immediately upon the gift; and (2) the donee must have retained such possession and enjoyment of the property to the entire exclusion of the donor or of any benefit to him by contract or otherwise. Both these conditions are cumulative. Unless each of these conditions is satisfied, the property would be liable to estate duty under s. 10 of the Act. The second part of the section has two limbs: the deceased must be entirely excluded (i) from the property, and (ii) from any benefit by contract or otherwise. The words \"by contract or otherwise\" in the second limb of the section will not control the words \"to (1) 63 I.T.R. 497, at p. 501. ", "558 ", "the entire exclusion of the donor\" in the first limb. The first limb may be infringed if the donor occupies or enjoys the property or its income, even though he has no right to do so which he could legally enforce against the donee. In other words, in order to attract the section, it is not necessary that the possession of the donor of the gift must be referable to some contractual or other arrangement enforceable in law or in equity. In the context of the section, the word \"otherwise\" should be construed ejusdem generis and it must be interpreted to mean some kind of legal obligation or some transaction enforceable at law or in equity, which, though not in the form of a contract, may confer a benefit on the donor. ", "There is no doubt on the facts of this case, the first two conditions are satisfied because there is an unequivocal transfer of the property and also of the money, in the one case by a settlement deed. and in the other by crediting the amount of Rs. 20,000/- in each of the sons' account with the firm which thenceforward became liable to the sons for the payment of the said amount and. the interest at 7 1/2% per annum thereon. In these circumstances, the has failed to establish that the had not retained possession and enjoyment of the property or the amount and that the deceased was not entirely excluded from the possession and enjoyment thereof. The last limb of the condition relating to any benefit to the donor by contract or otherwise is inapplicable in this case. The donor on the date when he gifted the property to his sons which was leased out to the firm, had two rights, namely, of ownership in the property and the right to terminate the tenancy and obtain the possession thereof. There is no dispute that the ownership has been transferred subject to the tenancy at will granted to the firm, to the donor's two sons because the firm from thenceforward had attorned to the as, their tenant by crediting the rent of Rs. 300/- to the respective accounts in equal moity. The donor could, therefore, only transfer possession of the property which the nature of that property was capable of, which in this case is subject to the tenancy. He could do nothing else to trans fer the possession in any other manner unless he was required to effectuate the gift for the purpose of S. 10 of the Act by getting the firm to vacate the premises and handing-over possession of the same to the leaving the thereafter to lease it out to the firm. Even then the objection of the learned Advocate that since the donor was a partner in the firm which had taken the property on lease, he derived benefit therefrom and was, therefore, not entirely excluded from the possession and enjoyment thereof, will nevertheless remain unsatisfied. To get over such an objection, the will have to lease out the property after getting possession from the firm to some other person ;totally unconnected with the donor. Such an unreasonable requirement the law does not postulate. The possession which the donor can give is the legal possession which the circumstances and, the nature of the property would admit. This he has given. The benefit the donor had as a member of the partnership was not a benefit referable in any way to the gift but is unconnected therewith. in and others v. Commissioner of Stamp Duties(1) was dealing with a case of a similar nature. The donor in that case by six registered transfers in the form prescribed, transferred by way of gift all his right, title and interest in portions of the land to each of his four sons and to trustees for each of his two, daughters and their children. The four sons and the two daughters were, prior to this transfer, on a verbal agreement with the donor, treated as partners of the business carried on by him as grazier of the land owned by him. The evidence showed that the transfers were taken subject to the partnership agreement and on the understanding that any partner could withdraw and work his land separately. On an analogous provision of the law, thought it unnecessary to determine the precise nature of the right of the partnership at the time of the transfers because it was either a tenancy during the term of the partnership or a licence coupled with an interests Lord , giving his opinion, observed at p. 67, that \"the benefit which the donor had as a member of the partnership in the right to which the gift was subject was not in their Lordships' opinion a benefit referable in any way to the gift'. This decision was referred to and distinguished in and another v. Commissioner of Stamp Duties(2), and though it was. considered to have no application to the case at point,_ Viscount ' observed at p. 97 : \"It must often be a matter of fine distinction what is the subject-matter of gift. It as in 's case, the gift is of a property shorn of certain of the rights which appertain to complete ownership, the donor cannot, merely because the remains in possession and enjoyment of those rights, be said within the meaning of the section not to be excluded from possession and enjoyment of that which he has given.\" In the Commissioner of Stamp Duties of New South Wales v. ) further elaborated the concept of the nature of possession required to be given to the donee as not to attract the analogous provisions of the Commonwealth Act. Lord Russel of Killowen observed at p. 440 \"The linking of possession with enjoyment as a composite object which has to be assumed by the donee indicate that the possession and enjoyment contemplated is beneficial possession and enjoyment by the object of the donor's bounty................ because the son was (through the medium of the trustees) immediately put (1) [1934] A.C. 61. (2) 37 I.T.R. [E.D.] 89- ", "(3) ", "560 ", "in such bona fide beneficial possession and enjoyment of the property comprised in the gift as the nature of the gift and the circumstances permitted. Did he assume it, and thenceforth retain it to the-entire exclusion of the donor ? The answer, their Lordships think, must be in the affirmative, and for two reasons : (1) the settlor had no enjoyment and possession and enjoyment as he had from the fact that the legal ownership of the shares vested in him and his co-trustees as joint tenants, was had by him solely on behalf of the donee. In his capacity as donor he was entirely excluded from possession and enjoyment of what he had given to his son. Did the donee retain possession and enjoyment to the entire exclusion of any benefit to the settlor of whatever kind or in any way whatsoever ? Clearly yes.\" ", "The views expressed by are in complete accord with our views already expressed. This was also the view held in (1), where a Bench of considered both the case of and of above referred to. In that case, on June 30, 1954, the deceased transferred to his two sons Rs. 57,594 being half of the share standing to his credit as on that date: in the books of a firm in which he was a partner and from July 1, 1954, the sons were also taken as partners in the firm. On the death of the deceased on November 16, 1957, the Assistant Controller held that the amount transferred to the sons must be deemed to pass as per the provisions of s. 10 of the Estate Duty Act, which decision was confirmed by the Appellate Controller. The , however, held that the sum which subsequently was rectified to be Rs. 73,695 Was not so includible. One of us (, J., as he then was), speaking for +the Bench, observed at p. ", "32 ", "On the facts of the case, it cannot be said that, after the gifts, the donees did not retain, the property gifted ,to the entire exclusion of the donor or that the donor had any benefit either by contract or otherwise in the property gifted. That in order that the property could deem to pass and estate duty could be leviable in such cases, the benefit of the donor must be a benefit referable to his own property. The view, that if it is once found ,that the deceased had some benefit in the property, that in itself was sufficient to bring the case within the ambit of section 10 irrespective of the question whether that benefit was referable or not referable to the gift, in our opinion, is erroneous.\" ", "(1) 72 I.T.R. 29. ", "561 ", "In our view, neither the property gifted to the donees, nor the amount of Rs. 1 lakh gifted to the five sons, could be included in the estate of the. deceased. The, appeal is accordingly dismissed with costs. ", " dismissed."], "relevant_candidates": ["0000714546", "0001946226"]} {"id": "0001957166", "text": ["PETITIONER: Vs. RESPONDENT: THE STATE OF PUNJAB DATE OF JUDGMENT28/11/1995 BENCH: MAJMUDAR S.B. (J) BENCH: MAJMUDAR S.B. (J) MUKHERJEE M.K. (J) CITATION: 1996 SCC (1) 458 JT 1995 (8) 434 1995 SCALE (6)653 ACT: HEADNOTE: JUDGMENT: ", "J U D G M E N T S.B. J. ", "Appellant, has brought in challenge his conviction and sentence as imposed upon him by at Chandigarh in Criminal Appeal No.637-DB of 1981. While allowing his appeal against conviction under Section 302 Indian Penal Code (in short ` IPC ') has convicted him for the lesser offence under Section 304 Part I, IPC and sentenced him to undergo rigorous imprisonment for 10 years. The appellant's grievance is that he is not liable to be convicted even under the said provision. ", "In order to appreciate the grievance of the appellant a few relevant facts leading to this appeal deserve to be noted at the outset. ", "BACKGROUND FACTS : ", "The appellant who was accused no.1 along with two other accused and were charged with offences under Sections 302 , 307 , 325 , 324 , 323 read with Section 34 of the on the allegation that on 11th January 1981 at about 6.00 p.m. in the area of village Nizamwala, in furtherance of their common intention which was to commit the murder of one lady Smt. , the appellant did commit murder of the aforesaid Mst. by intentionally causing her death whereas the other two accused committed offences under Section 302 read with Section 34 of the . Accused was also charged with an offence under Section 307 for having fired a gun shot at one with such intention and under such circumstances that if by that act he had caused the death of he would have been guilty of murder while the appellant was charged with an offence under Section 307 read with Section 34 . It was also alleged that at the same time and place in furtherance of their common intention accused Voluntarily caused hurt to by means of a `gandasa', which is an instrument of cutting, and thereby committed an offence punishable under Section 324 whereas appellant and accused were alleged to have committed offences punishable under Section 324 read with Section 34 of the . They were similarly charged for an offence for having caused hurt to one by means of a `gandasa', which is an instrument of cutting. Appellant was also charged along with other co-accused for having committed an offence under Section 325 read with Section 34 of the for having voluntarily caused grievous hurt to one . Appellant was lastly charged with an offence under Section 27 of the Arms Act on the allegation that on the same date, time and place he had in his possession a single barreled 12 bore gun with intent to use the same for an unlawful purpose, that is, to commit the murder of Mst. and that he actually used it for the above-said purpose thereby committing an offence under Section 325 of the . ", "The prosecution story briefly is to the effect that accused is the sister's son of accused and the appellant who belongs to village Baghewala, is their partyman. That prosecution witnesses, and , are the real brothers and Mst. deceased was the wife of and is the nephew of , is the cousin of and is the nephew of . That PW was to celebrate Lohri festival in connection with the birth of his grand-child. He went to at village Akku Masteke on 10th January 1981 to request him () to join the celebration of Lohri festival at his house. On 11th January 1981 at about 9.00 a.m. came to the house of and remained there upto 6.00 p.m. in connection with the distribution of sweets on the occasion of the birth of his ('s) grand- child. At about 6.00 p.m. , his wife Mst. , his brother came out of the house along with to see the letter off. They were standing in front of the gate of his ('s) house. At that time electric light which was fitted at his house, was illuminating in which a human being could be identified. was going to connect his tractor with his trolley. Meanwhile, accused armed with his D.B.B.L. gun, accused armed with a single barrelled gun and accused armed with `grandasa' came to the house of and raising `lalkaras'. accused raised a `lalkara' that he and his companion co-accused were going to teach and others a lesson for parking the tractor trolley in the lane. accused opened the attack by firing from his D.B.B.L. gun towards . However, the fire missed the target as he () had knelt down to save himself and the fire passed over his head. Thereafter appellant fired from his single barrelled gun and the shot hit Mst. deceased near he pelvic region. On receipt of this injury, she fell down on the ground. Thereafter accused dealt a `gandasa' blow on the head of from its sharp side. Meanwhile accused dealt blow with the butt of his gun on the left hand of and another blow from the said butt on his right ear. Then accused dealt a `gandasa' blow on the head of from its reverse side. Thereupon , and raised `raula' and on this, the accused decamped with their weapons. Before that, and also caused injuries on the person of appellant in their self- defence. Thereafter the PWs arranged a car in which was placed. and accompanied her to Civil Hospital, Forezepore, at a distance of 14/15 kilometers. The car left village Nizamwala at about 6.45 p.m. but died on the way at a distance of 6/7 miles near village Sodhiwala on their way to the Hospital. ", "On receipt of telephonic message, Inspector of Mallanwala went to , Ferozepore, and recorded the statement of , which formed the basis of the First Information Report. The inspector held inquest and sent the dead body of Smt. to the mortuary for autopsy. Thereafter, he went to the spot, lifted blood-stained earth and recovered one empty catridge case from there. The accused were arrested on 17th January 1981 and their weapons were taken into possession. ", "After investigation the appellant along with his co- accused were chargesheeted and ultimately their case was committed to the court of Sessions for trial. The learned Trial Judge after recording evidence and hearing the rival versions took the view that appellant was guilty of an offence under Section 302 of the for killing Smt. and ordered him to undergo imprisonment for life and to pay a fine of Rs.3,000/- or in default to further undergo rigorous imprisonment for one and a half years, while and accused were sentenced under Section 302 read with Section 34 of and were directed to undergo imprisonment for life and to pay a fine of Rs.1,000/- each and in default of payment of fine to further undergo rigorous imprisonment for six months each. accused was sentenced under Section 307 and was directed to undergo rigorous imprisonment for one and a half years and to pay a fine of Rs.300/- and in default of payment of fine to further undergo rigorous imprisonment for two months while the appellant and another accused were sentenced under Section 307 read with Section 34 and were directed to undergo rigorous imprisonment for six months each and to pay a fine of Rs.100/- each and in default of payment of fine to further undergo rigorous imprisonment for one month each. Appellant was also sentenced under Sections 324 and 325 read with Section 34 for the injuries caused to the concerned PWs as mentioned in the charge. He was sentenced to undergo rigorous imprisonment for six months under Section 27 of the Arms Act. ", "The aforesaid decision of resulted in criminal appeal moved by the appellant and the other two accused and in at Chandigarh. of after hearing the contesting parties came to the conclusion that the co-accused and deserved to be acquitted of the offences with which they were charged and the appeal qua them was fully allowed while so far as the appellant was concerned, he was acquitted of offences under Section 302 , Section 307 read with Section 34 , Sections 324 and 325 read with Section 34 I.P.C. However, he was held guilty of an offence under Section 304 Part I, IPC . He was sentenced as aforesaid. His conviction and sentence under Section 27 of the Arms Act were also maintained. That is how the appellant is before us in the present appeal. ", "Learned advocate appearing for the appellant contended that when came to the conclusion that the appellant had a right of private defence of body having received number of injuries in the incident, instead of carrying this conclusion to its logical end, wrongly assumed that the appellant had exceeded his right of private defence of body as his reasonable apprehension could be of having caused simple hurt at the hands of the complainant party and, therefore, he had a right to give only grievous hurt but could not have caused any fatal injury by the use of his firearm. It was vehemently contended that looking to the evidence on record the aforesaid finding of is not well sustained. Learned counsel for the respondent State of Punjab on the other hand tried to support the reasoning and the final conclusion to which reached. In our view the decision of to the effect that the appellant had exceeded the right of private defence cannot be supported on the evidence on record. It will be profitable to extract what has said in this connection in the penultimate paragraph of its judgment at page 15 : ", "\"... appellant and had sustained as many as 12 injuries and out of them 2 injuries on the person of and one injury on the person of were on the vital parts of their bodies. In such a situation, the accused party could legitimately harbour the apprehension that the complainant party would cause them simple hurt. But appellant had over stepped the legal limits of the defence of person by firing a shot from his gun which hit Smt. and proved fatal. The occurrence appears to have taken place all of a sudden and it was not a pre- planned attack. When appellant apprehended simple hurt at the hands of the compainant party, he had the right to give a grievous hurt but he obviously exceeded the right of private defence of his person and caused one fire arm injury, which proved fatal. Consequently is found guilty for an offence under section 304 Part I, Indian Penal Code ...\" ", "Now it must be noted that according to the appellant had a right of private defence as he had sustained number of injuries in the incident. So far as his injuries are concerned, Dr. , PW.1 has described the injuries by stating as under : ", "\"I conducted medico legal examination on the person of accused and found the following injuries on his person:- ", "1. Incised wound of the size 5.5 cm x 1 cm bone deep at the right front pariental region 9.5 cm from the right eye-brow, obliquely placed and 8 cm from the right pinna. Blood clot was present. ", "X-ray was advised. ", "2. Swelling of the size 3.5 cm x 3.5 cm on the left side of the fore-head 1.5 cm above the left eye-brow. X-ray was advised. ", "3. Reddish swelling of the size 5 cm x 3.5 cm with overlying abrasion 2 cm x 0.5 cm, at the back and upper part of left fore-arm. ", "4. Swelling of the size 2.5 cm x 2.5 cm with overlying lacerated wound 0.75 cm x 0.25 cm back and middle of left middle finger of hand. X-ray was advised. ", "5. Swelling 1 cm x 1.5 cm at the tip of middle finger of left hand. X-ray was advised. ", "6. Abrasion 0.5 cm x 0.5 cm on medical aspect and middle of left index finger. ", "7. Reddish contusion 5.5 cm x 2 cm at the upper and lateral aspect of right upper arm. X-ray was advised. ", "8. Reddish contusion 5 cm x 3 cm on the front and middle of right upper arm. ", "9. Abrasion 3 cm x 2 cm on front of right elbow joint. ", "The patient was conscious. Pulse was 72 per minute. B.P. 130/70. Nature of the injuries. Injuries nos : ", "1,2,3,4,5 and 7 were kept under observation for X-ray. Injuries nos: ", "3,6,8 and 9 were declared simple. The probable duration of the injuries was within six hours. The weapon declared for injury no.1 was sharp edged. Rest all by blunt weapon. On receiving X-ray report No.10/60, dated 13.1.1981, injuries nos : 1,2,4,5, and 7 were declared simple.\" ", "Now it becomes at once clear that the appellant had received as many as nine injuries out of which first two injuries were on a very vital part, namely, on his head and injury no.1 was an incised wound which was caused by a sharp-edged weapon. Under these circumstances if the appellant fired one shot from his gun in his self-defense it could not be said that he had exceeded the right of private defence as the nature of assault by the complainant party which left him with the aforesaid injuries certainly could be said to have caused a reasonable apprehension in his mind that grievous hurt would otherwise be the consequence of such an assault. In this connection it will be profitable to look at Section 100 of the Indian Penal Code which reads as under : ", "\"100. When the right of private defence of the body extends to causing death.-- The right of private defence of body extends, under the restrictions mentioned in the last preceding section, to the Voluntary causing of death or of any other harm to the assailant, if the offence which occasions the exercise of the right be of any of the descriptions hereinafter enumerated, namely :- First:- Such an assault as may reasonably cause the apprehension that death will otherwise be the consequence of such assault; ", "Secondly:- Such an assault as may reasonably cause the apprehension that grievous hurt will otherwise be the consequence of such assault; Thirdly.- An assault with the intention of committing rape; ", "Fourthly.- An assault with the intention of gratifying unnatural lust; Fifthly.- An assault with the intention of kidnapping or abducting; Sixthly.- An assault with the intention of wrongfully confining a person under circumstances which may reasonably cause him to apprehend that he will be unable to have recourse to the public authorities for his release.\" ", "It is not the case of the prosecution that any of the restrictions mentioned in Section 99 can be invoked by the prosecution against the appellant. Once that is so, clause `secondly' of Section 100 would squarely get attracted. It is difficult to appreciate the reasoning of that the reasonable apprehension in the mind of the appellant who had received two injuries on his head and seven other injuries on his body would be the apprehension that only simple hurt would be caused to him and not grievous hurt. It is true that the first injury caused on his head had fortunately not resulted into a fracture but when it was caused with a sharp cutting instrument on the vital part of his body, namely, right side of head, it cannot be gainsaid that at least a reasonable apprehension would arise in his mind at the spur of the moment that if he does not retaliate by using his weapon, namely, the gun with which he was armed he would certainly suffer at least a grievous hurt as a consequence of the assault by the c party. Under these circumstances the right of private defence of body available to the appellant would extend to even causing death. It is of course true that his, gun shot unfortunately hit an innocent person like Smt. who was present on the scene of occurrence but as at the very same time and place the appellant had suffered an assault at the hands of the assailants comprising of the complainant party, right of private defence of body which would extend to even causing death of the assailant would arise in favour of the appellant on the facts of the present case and in exercise of that right if death is caused not of the assailant but of any other person it cannot be said that the right of private defence extending up to causing death of the assailant would not be available to the accused qua even an innocent party which got fatally hurt on account of the exercise of such a right of private defence which ensured for the appellant under Section 100 clause secondly of the IPC . It is obvious that if an accused with an intention to kill his victim fires a shot at him which misses the target and hits any other innocent person fatally he would remain guilty of an offence of murder but if the accused had no such intention and was protected by right of private defence under the situation and circumstances in which it could extend to even causing death of assailant as laid down by Section 100 and if in exercise of that right of private defence the blow fatally falls on an innocent person the action would still remain protected under Section 100 of the . In this connection we may refer to Section 301 , IPC which reads as under : ", "\"301. Culpable homicide by causing death of person other than person whose death was intended.- If a person, by doing anything which he intends or knows to be likely to cause death, commits culpable homicide by causing the death of any person, whose death he neither intends nor knows himself to be likely to cause, the culpable homicide committed by the offender is of the description of which it would have been if he had caused the death of the person whose death he intended or knew himself to be likely to cause.\" ", "For applicability of that Section the act must amount to culpable homicide in the first place. If the act is not culpable at all, then even if it results into homicide of an innocent person, in view of Section 100 as in the present case, Section 301 will have no operation. ", "While judging the nature of apprehension which an accused can reasonably entertain in such circumstances requiring him to act on the spur of moment when he finds himself assaulted, by number of persons, it is difficult to judge the action of the accused from the cool atmosphere of the court room. Such situations have to be judged in the `light of what happens on the spur of the moment on spot and keeping in view the normal course of human conduct as to how a person would react under such circumstances in a sudden manner with an instinct of self-preservation. Such situation have to be judged from the subjective point of view of the accused concerned who is confronted with such a situation on spot and cannot be subjected to any microscopic and pedantic scrutiny. In this connection it is profitable to refer to two decisions of this Court. In the case of (1980 Supp. SCC 215), a Division Bench of this Court speaking through , J. made the following pertinent observations : ", "\"...the onus which rests on an accused person under Section 105 , Evidence Act , to establish his plea of private defence is not as onerous as the unshifting burden which lies on the prosecution to establish every ingredient of the offence with which the accused is charged, beyond reasonable doubt. It is further well established that a person faced with imminent peril of life and limb of himself or another, is not expected to weigh in `golden scales' the precise force needed to repel the danger. Even if he in the heat of the moment carries his defence a little further than what would be necessary when calculated with precision and exactitude by a calm and unruffled mind, the law makes due allowance for it...\" ", "In the case of . (1973 (1) SCC ", "347), this Court was concerned with a situation where the accused had received a blow on head by a `lathi' and in self-defence he had used his spear in retaliation. While holding that the accused was entitled to the right of private defence extending to even causing death, in such a case, he was acquitted of the offence under Section 302 . In this connection , J., speaking for this Court in paragraph 5 of the Report has made these pertinent observations : ", "\"In our opinion, does seem to have erred in law in convicting the appellant on the ground that he had exceeded the right of private defence. What really seems to have missed is the provision of law embodied in Section 102 , I.P.C . According to that section the right of private defence of the body commences as soon as a reasonable apprehension of dager to the body arises from an attempt or threat to commit the offence, though the offence may not have been committed, and such right continues so long as such apprehension of danger to the body continues. The threat, however, must reasonably give rise to the present and imminent, and not remote or distant danger. This right rests on the general principle that where a crime is endeavored to be committed by force, it is lawful to repel that force in self- defence. To say that the appellant could only claim the right to use force after he had sustained a serious injury by an aggressive wrongful assault is a complete misunderstanding of the law embodied in the above section. The right of private defence is available for protection against apprehended unlawful aggression and not for punishing the aggressor for the offence committed by him. It is a preventive and not punitive right. The right to punish for the commission of offences vests in the (which has a duty to maintain law and order) and not in private individuals. . ............. the approach of that merely because the complainat's party had used lathis, the appellant was not justified in using his spear is no less misconceived and insupportable, During the course of a marpeet, like the present, the use of a lathi on the head may very well give rise to a reasonable apprehensions that death or grievous hurt would result from an injury caused thereby. It cannot be laid down as a general rule that the use of a lathi as distinguished from the use of a spear must always be held to result only in milder injury. Much depends on the nature of the lathi, the part of the body aimed at and the force used in giving the blow. Indeed, even a spear is capable of being so used as to cause a very minor injury. seems in this connection to have overlooked the provision contained in section 100 , I.P.C . We do not have any evidence about the size or the nature of the lathi. The blow, it is known, was aimed at a vulnerable part like the head. A blow by a lathi on the head may prove instantaneously fatal and cases are not unknown in which such a blow by a lathi has actually proved instantaneously fatal. If, therefore, a blow with a lathi is aimed at a vulnerable part like the head we do not think it can be laid down as a sound proposition of law that in such cases the victim is not justified in using his spear in defending himself. In such moments of excitement or disturbed mental equilibrium it is somewhat difficult to expect parties facing grave aggression to cooly weigh, as if in golden scales, and clamly determine with a composed mind as to what precise kind and severity of blow would be legally sufficient for effectively meeting the unlawful aggression. No doubt, does seem to be aware of this aspect because the other accused persons were given the benefit of this rule. But while dealing with the appellant's case curiously enough has denied him the right of private defence on the sole ground that he had given a dangerous blow with considerable force with a spear on the chest of the deceased though he himself had only received a superficial lathi blow on his head. This view of is not only unrealistic and unpractical but also contrary to law and indeed even in conflict with its own observation that in such case the matter cannot be weighed in scales of gold.\" ", "The facts of the present case are almost parallel to the facts of the aforesaid case. Consequently it must be held that the appellant had a right of private defence of body which extended to even causing death and in exercise of that right if he fired one gun shot which unfortunately killed an innocent person that is, Smt. , it cannot be said that he was guilty of an offence even under Section 304 Part of the on the ground that he had exceeded his right of private defence. Consequently the conviction of the appellant under Section 304 part I, IPC as pendered by is quashod and set aside. has already acquitted the appellant of charges under Sections 307 , 324 and 325 of the . So far as his conviction under Section 27 of the Arms Act is concerned even that would not survive as it could not be said that he has used his gun of any unlawful purpose, that is to commit culpable homicide of Mst. not amounting to murder. The appeal is accordingly allowed. Accused is no bail. His bail bound shall stand discharged."], "relevant_candidates": ["0000032434", "0000148938"]} {"id": "0001965879", "text": ["PETITIONER: POWER CONTROL APPLIANCES Vs. RESPONDENT: SUMEET MACHINES PVT. LTD DATE OF JUDGMENT08/02/1994 BENCH: , S. (J) BENCH: , S. (J) VENKATACHALLIAH, M.N.(CJ) CITATION: 1994 SCR (1) 708 1994 SCC (2) 448 JT 1994 (2) 70 1994 SCALE (1)446 ACT: HEADNOTE: JUDGMENT: ", "The Judgment of the Court was delivered by , J.- All these appeals can be dealt with under a common judgment. The Civil Appeal Nos. 2551-52 of 1993 are by the first plaintiff while Civil Appeal No. 2553 of 1993 by the second plaintiff. ", "451 ", "2.The plaintiffs filed three suits on the file of (i) C.S. No. 343 of 1992 complaining of infringement of the copyright of the first plaintiff (); ", "(ii)C.S. No. 431 of 1992 alleging the violation of the registered trade mark 'Sumeet' No. 263836 in Part-A in Class 7 for machines (electric) for kitchen use; ", "(iii)C.S. No. 432 of 1992 claiming the design registration in the 'Whipper Blade' of the power operated mixies. ", "3.Pending these suits, four application Nos. 226, 227, 271 and 272 of 1992 were taken out, two in of 1992 and one each in C.S. Nos. 431 and 432 of 1992 respectively. ", "4.The facts are common to all the suits and the applications. In C.S. No. 343 of1992 in the Application Nos. 226 & 227 of 1992, the plaintiffs prayed for aninterim injunction to restrain the respondents (defendants) from using, distributing, printing or causing to be printed the work as contained in Document Nos. (1) receipt and instruction manual, (2) guarantee card and (3) outer carton and the work as found in Document Nos. 4, 5 and 6. In C.S. No. 431 of 1992 in Application No. 271 of 1992 an interim injunction was sought to restrain the respondents from using the registered trade mark. In C.S. No. 432 of 1992 in Application No. 272 of 1992 the injunction was sought to restrain the respondents from using the design registration in manufacturing the mixies. ", "5.Admittedly, Mrs is the sole proprietrix of . She started manufacturing power operated kitchen mixies for domestic use since 1963. They are marketed since 1964 under the brand name of 'Sumeet'. The mixy was packed in a cardboard box and at the top the pictorial and photograph display of the appliance in different colours showing the different purposes for which the mixy could be used was shown. A booklet was enclosed bearing the title \"Sumeet Domestic Mixer-Operating Instructions and Recipe Book\". That consisted of 80 pages bound spirally in hard art paper cover. A guarantee card was also issued. All these were devised, conceived and made by the first plaintiff in 1982 with the assistance of artists, photographers, printers and executives employed by the first plaintiff for valuable considerations fully paid. As such the first plaintiff is the owner of copyright with respect of all the above items in terms of Section 17 of the Copyright Act, 1957. 'Sumeet' mixy came to be in great demand in India and abroad. The business expanded. To cope up with the demand, the first plaintiff had to float three more concerns for the manufacturing of the same appliances. The companies are: ", "(i) ", "(iii)Mathur ", "(iii)Power Control Appliances (). ", "452 ", "All these concerns except buy electric motors for their mixies from the second plaintiff . That is deemed to be public limited company. Mrs is the Chairman and Director. She holds 59.25% shares. ", "6.The artistic manner in which the word 'Sumeet' is written was conceived and published by the first plaintiff. It was registered trade mark with effect from April 18, 1970. This trade mark was assigned to the second plaintiff on January 1, 1981. The second appellant is the owner of the copyright. ", "7.The first defendant was incorporated in 1984. It has been manufacturing and selling mainly washing machines and vacuum cleaners from September/October 1991. It has started manufacturing domestic mixies exactly similar to plaintiffs' mixer with identical specifications except for power rating. The package and the pictorial display are identical. Even the booklet is pagewise reproduction including an error with respect to Design No. 146781, a design number not belonging to the plaintiffs. The contents of the guarantee card are also identical. The first defendant is affixing in each of the appliances the registered trade mark 'Sumeet' belonging to the second plaintiff in the same artistic manner in which it is registered. On these allegations, it was urged that the first defendant had committed infringement of the exclusive copyright of the first plaintiff in the artistic material and trade literature displayed on the cardboard box. Similarly, the operating instructions and recipe book and the guarantee card issued by them. ", "8.With regard to the four components of the mixer, Mrs had obtained registration of their design under Part-11 of the Designs Act, 191 1. Those components are: ", "(ii) Whipper blade, ", "(iii)Polycarbonate dome, ", "(iv) Stainless steel jar with rim. ", "9.Each one of them has a specific registration number. Though the statutory period of 15 years or the validity of the copyright had elapsed on May 23, 1992 concerning items ", "(i), (ii) and (iv), as regards whipper blade the validity of registration is up to April 5, 1994. Therefore, it is not open to anyone to infringe the same. Thus, the applications on the grounds came to be preferred. ", "10.The first defendant did not file the written statement. However, he filed his counter-affidavit. The stand taken by him is that he () is the eldest son of Mrs . On his return from United States, the family business, mainly kitchen appliances and mixer machines under the trade name of '' had picked up by the innovative ideas and dynamic marketing strategies evolved by him. The family of included the plaintiffs, the first defendant and others. The family was selling mixies since 1963. It is true that three other companies were floated. In fact, he was the Director of until recently. Because of inter se disputes, he was obliged to leave the said company. ", "11.The first defendant company was incorporated in 1984 as for the purpose of manufacture of market kitchen appliances under the trade name of '' and other products such as washing machines. The said company itself was incorporated with the knowledge and approval of the plaintiffs-applicants. When was sought to be registered before , Maharashtra, a letter of no objection from the owners of the trade mark '' had to be produced. The first defendant obtained letters both from the first and second plaintiffs on May 7, 1984. It was only on this the company came to be registered on September 5, 1984. As a matter of fact, Mrs is a shareholder in first defendant, she having been allotted 5000 shares. Likewise, the father of first defendant also owns 5000 shares. ", "12.Since 1986, the first defendant has been manufacturing and marketing mixies under the trade name of ''. This was done with the knowledge and consent of the plaintiffs openly and concurrently. Further, Mrs and the father of first defendant have signed and given personal guarantees to on behalf of the first defendant. The loans were secured on that basis. In short, the reply of the first defendant is that the copyright trade mark and the copyright design is that of the first defendant which was conceived as a family concern. The word '' was given with the blessings and consent of and . Therefore, he has been an honest and concurrent user. In any event, the plaintiffs' applications were not entitled to the reliefs on the ground of acquiescence. ", "13.The learned Single Judge as seen from the report of decision in held that the copyright with respect to operative instructions and recipe book, guarantee card and the outer carton of the Kitchen Mixies vested in represented by the Sole Proprietrix Mrs . Equally, the copyright in the Design Registration No. 148246 in relation to 'whipper blade' was also accepted as belonging to the plaintiff. The trade mark in the name of '' with the particular artistic design is registered in the name of Research and Holdings Limited was accepted as claimed by the plaintiffs. Notwithstanding, all these, the relief of injunction was not granted in view of acquiescence by the plaintiffs in the honest and concurrent user of the first defendant. Against this judgment, OSA Nos. 144-46 of 1992 came to be preferred. ", "14.The Division Bench by the impugned judgment dated February 26, 1993 held that the learned Single Judge was not wrong in holding that the plaintiffs have acquiesced in the use of the trade literature and the trade mark by the first defendant. The relief in equity of injunction, if granted, will affect the interest of not only but also other members of the family who are shareholders of the first defendant's company. Accordingly the appeals were dismissed. It is under these circumstances, these civil appeals have been preferred; Civil Appeal No. 2551 of 1993 against Application Nos. 226 & 227 of 1992 in CS No. 343 of 1992, Civil Appeal No. 2552 of 1993 against Application No. 271 of 1992 in CS No. 432 of 1992 and Civil Appeal No. 2553 of 1993 against Application No. 272 of 1992 in CS No. 431 of 1992. ", "15.Mr , learned counsel for the appellants submits that both the courts below having held in favour of the appellants herein that there is an infringement of the trade mark, the copyright and the design should not have dismissed the application for injunction solely on the ground of honest and concurrent user and on the plea of acquiescence. On the contrary the evidence in this case discloses that the first defendant was only marketing (but never manufacturing) from 1986. Therefore, merely because he was marketing, that cannot amount to honest and concurrent user. It was only in September-October 1991 he started infringing the trade mark, copyright and the design. Therefore, when the suit came to be filed immediately, no question of acquiescence would ever arise. It is only on 28th of October, 1991 the first defendant invited applications for distribution. ", "16.The conclusions of lead to strange results. Notwithstanding the finding of the court that the appellants' copyrights, registered trade mark and registered design having been occupied totally consciously and deliberately without any alteration and thereby infringed by the defendant to deny injunction in equity cannot be supported. After all the plaintiff Mrs as an individual has 3.3 per cent of the shareholding in the first defendant-company. ", "17.To hold that the first defendant was using the registered trade mark from 1984 is wrong when admittedly the first defendant-company came into existence only in 1984. ", "18.Under Sections 19 and 54 of the Copyright Act reproduction of the copyright itself is infringement unless there is specific assignment in writing by the proprietor. In this case, there is not even a plea that Mrs assigned the copyright in the outer carton handbook and guarantee card. The concept of honest and concurrent user found in Section 12(3) of the 1958 Act for securing concurrent registration is totally irrelevant as defence in a suit for infringement and copyright arising out of a different Act, namely, 1957 Act. Therefore, there can be no honest and concurrent user of one's copyright by another. After 1958 Act, the plea of acquiescence is not available at all. Even assuming that the first defendant was manufacturing between June 1989 and October 1991 he cannot have the benefit of Section 30(1)(b) of the 1958 Act*. This Act creates offences for such infringement under Sections 78 and ", "29. Section 96 also speaks of implied warranty. These provisions were not found in the 1940 Act. .2 this Court had occasion to point out the distinction between the infringement and passing off. :On this basis it is submitted all that has to be proved by the plaintiff is that she is the registered owner of the trade mark. If there is an infringement, injunction must follow. Section 12(3) of the 1958 Act talks of special circumstances in relation to honest and concurrent user. In such a case the defences available are as laid down in Sections 30 , 34 and 35 of that Act. Such defences are not available in the instant case. In this case, factually there is no acquiescence. ", "19.In support of these submissions; learned counsel relies on and particularly the passage occurring at page 497 to show in what case the plea of acquiescence could ever be made. Equally, in v. it was held that the court is bound to grant an injunction if the legal right is established. In the case on hand it has been so established. In v. as to when the plea of acquiescence could be upheld, is stated. In Bostitch Trade Mark6 the plea of acquiescence has been dealt with. Judged in the light of these rulings, the finding relating acquiescence cannot at all be upheld. ", "20.Mr , learned Senior Counsel for the respondent submits that it is a clear case in which there are various acts, collectively pointing out to implied consent to the use of plaintiff's trade mark. They establish, at least prima facie, the acquiescence on the part of the appellant. They would disentitle it to the interim relief of injunction. The acts are as under: ", "(1)The letter dated May 7, 1984 to regarding the allocation of the name . ", "(2)The encouragement of production of new electronic food preparation machine. (3)No objection whatsoever by the plaintiff or any other related companies or even by Mr or Mrs to the manufacture and sale by this respondent till the issue of notice dated November 18, 1991. ", "There is also evidence in this case to show that the first respondent has been manufacturing mixing machines from July 1987. There is also a clear * The Trade and Merchandise Marks Act , 1958 + The Trade Marks Act , 1940 2 (1 969) 2 SCC 727 : (1970) 2 SCR 222, 224 3 (1963) 2 SCR 484: AIR 1963 SC 449 4 (1948) 55 RPC 329, 338 5 1954 RPC 23, 34 6 1963 RPC 183, 202 admission on the part of the plaintiff that the first respondent was manufacturing his products under the trade name of at least since June 1989. This is evident from the following: ", "(i)Criminal complaint dated April 6, 1992 mentions the manufacture of washing machines, vacuum cleaners and industrial mixies from 1984 and the manufacture of kitchen machines from 1989-90. ", "(ii)The affidavit filed on behalf of the appellants mentions about the manufacture since June 1989. There is a similar admission in paragraph II of the plaint. The export of these domestic mixies as Sumeet 842 INT is done by the first respondent. All these point out to acquiescence which would be a good ground for denying the interim relief of injunction. ", "21.The appellant has disentitled itself from the grant of equitable relief of injunction by reason of unexplained delay and suppression of material facts. The balance of convenience is also overwhelmingly in favour of this respondent in view of the facts stated above that the first respondent has been manufacturing and marketing productions with the trade name of since 1989. ", "22.It is not correct to contend that once the trade mark is infringed the plaintiff would be entitled to injunction. Section 30(b) is still applicable and it is open to this respondent to show that there had been an implied consent to the use of the trade mark. In support of this submission learned counsel places reliance on .7 ", "23.As regards the principles in relation to the grant of interim injunction the law has been laid down in v. . Similar principles are stated in v. ", "24.In dealing with this case we would like to keep this in the back of our mind that we are concerned with an interim application for injunction in relation to the violation of copyright, trade mark and the design. observed in paragraph 8 as follows: ", "\"The learned Single Judge, while disposing of the applications, has in the impugned judgment, accepted the copyright with respect to operating instructions and recipe book, guarantee card and the outer carton of the kitchen mixies in represented by the Sole Proprietrix Mrs , as well as the copyright in the Design Registration No. 148246 for 'whipper blade' for which there is validity till April 5, 1994. He has also accepted the plaintiffs' case that the trade mark in the name '' with the particular artistic design is registered in the name of Research and Holdings Limited. He has, however, declined to grant any injunction, for in his opinion the doctrine of acquiescence and honest and concurrent user will be attracted.\" ", "8 (1957) 2 MLJ 573 9 (1 975) 1 All ER 504, 511 : (1975) AC 396 ", "25.If there is an infringement of the same whether the appellant would be entitled to interim injunction at this stage is the important question for determination. For such a determination, we refrain from going into the details relating to evidence as that will prejudice the parties in the suits. Section 30(1)(b) of the 1958 Act says: \"30. Acts not constituting infringment.-(1) Notwithstanding anything contained in this Act, the following acts do not constitute an infringement of the right to the use of a registered trade mark--- ", "(a * * * ", "(b)the use by a person of a trade mark in relation to goods connected in the course of trade with the proprietor or a registered user of the trade mark if, as to those goods or a bulk of which they form part, the registered proprietor or the registered user conforming to the permitted use has applied the trade mark and has not subsequently removed or obliterated it, or has at any time expressly or impliedly consented to the use of the trade mark.\" ", "Therefore, acquiescence is one of the defences still available to the first respondent. Of course, it is a different issue whether the plea of acquiescence has been made out in this case. That will be examined for a limited purpose after setting out the law on this aspect. ", "26.Acquiescence is sitting by, when another is invading the rights and spending money on it. It is a course of conduct inconsistent with the claim for exclusive rights in a trade mark, trade name etc. It implies positive acts; not merely silence or inaction such as is involved in laches. In v. Sr. said: \"It is important to distinguish mere negligence and acquiescence.\" Therefore, acquiescence is one facet of delay. If the plaintiff stood by knowingly and let the defendants build up an important trade until it had become necessary to crush it, then the plaintiffs would be stopped by their acquiescence. If the acquiescence in the infringement amounts to consent, it will be a complete defence as was laid down in & Co. v. \". The acquiescence must be such as to lead to the inference of a licence sufficient to create a new right in the defendant as was laid down in v. . ", "27.The law of acquiescence is stated by , in Pro tor v. as under: ", "\"It is necessary that the person who alleges this lying by should have been acting in ignorance of the title of the other man, and that the other man should have known that ignorance and not mentioned his own title.\" In the same case , said: ", "10 (1860) 28 Beav 303 :54 ER 382 11 (1884)26ChD406 12 (1847) 2 De GM&G 614: 22 LJ KCH 404 13 (1887) 36 Ch D 740 \"In order to make out such acquiescence it is necessary to establish that the plaintiff stood by and knowingly allowed the defendants to proceed and to expend money in ignorance of the fact that he had rights and means to assert such rights.\" ", "28. In Devidoss and Co.7 at pages 33 and 34 the law is stated thus: ", "\"To support a plea of acquiescence in a trade mark case it must be shown that the plaintiff has stood by for a substantial period and thus encouraged the defendant to expend money in building up a business associated with the mark. In v. observed: ", "'If the plaintiff really does stand by and allow a man to carry on business in the manner complained of to acquire a reputation and to expend money he cannot then after a long lapse of time, turn round and say that the business ought to be stopped.\"' In the same case, but on appeal Lord , C.J. said' 5 at p. 43: ", "\"Is the plaintiff disentitled to relief under that head by injunction because of acquiescence? Of course it is involved in the consideration of that that the plaintiff has a right against the defendant and that the defendant has done him a wrong and the question is whether the plaintiff has so acted as to disentitle him from asserting his right and from seeking redress from the wrong which has been done to him. Cases may occasionally lay down principles and so forth which are a guide to the court, but each case depends upon its own circumstances. ", "Dealing with the question of standing by in Codes v. Addis and Son16 at P. 142, Eve, said: ", "'For the purpose of determining this issue I must assume that the plaintiffs are traders who have started in this more or less small way in this country, and have been continuously carrying on this business. But I must assume also that they have not, during that period, been adopting a sort of policy of going to sleep and not watching what their rivals and competitors in the same line of business were doing. I accept the evidence of any gentleman who comes into the box and gives his evidence in a way which satisfies me that he is speaking the truth when he says that he individually did not know of the existence of a particular element or a particular factor in the goods marketed by his opponents. But the question is a wider question than that : ought not he to have known : is he entitled to shut his eyes to everything that is going on around him, and then when his rivals have perhaps built a very important trade by the user of indicia which he might have prevented their using had he moved in time, come to the and say : \"Now stop them from doing it further, because a moment of time has arrived 14 (1896) 13 RPC 464 15 Rowland v. , (1 897) 14 RPC 37, 43 16 (1923) 40 RPC 130, 142 when I have awakened to the fact that this is calculated to infringe my rights.\" Certainly not. He is bound, like everybody else who wishes to stop that which he says is an invasion of his rights, to adopt a position of aggression at once, and insist, as soon as the matter is brought to , it ought to have come to his attention, to take steps to prevent its continuance; it would be an insufferable injustice were the to allow a man to lie by while his competitors are building up an important industry and then to come forward, so soon as the importance of the industry has been brought home to his mind, and endeavour to take from them that of which they had legitimately made use; every day when they used it satisfying them more and more that there was no one who either could or would complain of their so doing. The position might be altogether altered had the user of the factor or the element in question been of a secretive or surreptitious nature; ", "but when a man is openly using, as part of his business, names and phrases, or other elements, which persons in the same trade would be entitled, if they took steps, to stop him from using, he gets in time a right to sue them which prevents those who could have stopped him at one time from asserting at a later stage their right to an injunction.' In v. acquiescence for four years was held to be sufficient to preclude the plaintiff from succeeding. In 1897 the plaintiffs in that case registered the word 'glacier' as a trade mark in respect of transparent paper as a substitute for stained glass. As the result of user the word had become identified with the plaintiffs' goods. In 1900 the defendants commenced to sell similar goods under the name 'glazine. In 1905 the plaintiffs commenced an action for infringement. The defendants denied that the use of the word 'glazine' was calculated to deceive and also pleaded acquiescence. A director of the plaintiff company admitted that he had known of the use of the word 'glazine' by the defendants for four years he would not say it was not five years. It was held that the plaintiffs failed on the merits and by reason of their delay in bringing the action. ", "Delay simpliciter may be no defence to a suit for infringement of a trade mark, but the decisions to which I have referred to clearly indicate that where a trader allows a rival trader to expend money over a considerable period in the building up of a business with the aid of a mark similar to his own he will not be allowed to stop his rival's business. If he were permitted to do so great loss would be caused not only to the rival trader but to those who depend on his business for their livelihood. A village may develop into a large town as the result of the building up of a business and most of the inhabitants may be dependent on the business. No hard and fast rule can be laid down for deciding when a person has, as the result of inaction, lost the right of stopping 17 (1960) 23 RPC 1 another using his mark. As pointed out in v. each case must depend on its own circumstances, but obviously a person cannot be allowed to stand by indefinitely without suffering the consequence.\" ", "29. This is the legal position. Again in Halsbury's Laws of England, Fourth Edn., Vol. 24 at paragraph 943 it is stated thus: ", "\"943. Acquiescence.- An injunction may be refused on the ground of the plaintiff's acquiescence in the defendant's infringement of his right. The principles on which the court will refuse interlocutory or final relief on this ground are the same, but a stronger case is required to support a refusal to grant final relief at the hearing. [.Patching v. ; v. ; v. Wyatt2O; v. 21; v. ; v. and ] The reason is that at the hearing of the cause it is the court's duty to decide upon the rights of the parties, and the dismissal of the action on the ground of acquiescence amounts to a decision that a right which once existed is absolutely and for ever lost: v. Wyatt2O at 25; and see v. and Co.24 per Lord Langdale MR.') ", "30.In v. , LD.4 at pp. 338-39 it was held thus: \"Apart from this point the case of v. 25 shows that the injunction in a passing-off case is an injunction sought in aid of a legal right, and that the is bound to grant it if the legal right be established unless the delay be such that the Statute of Limitations would be a bar. That case apparently concerned some predecessors of the defendants. The delay was one of rather under two years and the relief sought was an injunction to restrain the use by the defendants of cards and wrappers calculated to induce the belief that his business was connected with the plaintiff. , in the course of his judgment said this: ", "\" Now, assuming, as I will, for the purpose \"of my decision, that in the early part of 1875 the plaintiff knew of all the material facts\" which have been brought before me today, he commenced his action in November 1876. \"In my opinion that delay, and it is simply delay, is not sufficient to deprive the plaintiff of' his rights. The right asserted by the plaintiff in this action is a legal right. He is, in 18 (1853) Kay 1 : 69 ER 1 19 (1 854) 5 De GM&G 739: 43 ER 1057 20 (1863) 2 De GJ&Sm 18: 46 ER 281 21 (1865) 34 Beav 390: 55 ER 685 22 (1874) LR 18 Eq 444 23 (1 884) 50 LT 787 24 (1 842) 5 Beav 229, 233 : 49 ER 565 25 (1878) 9 Ch D 176: 47 LJ Ch 459 \"effect, asserting that the defendants are liable to an action for deceit\". It is not suggested in the defence that the delay here involves a question under or analogous to the period under the Statute. The defendants did suggest that there had been something more than mere delay on the part of the plaintiffs, and that the plaintiffs had lain by and allowed the goodwill which the plaintiffs now propose to acquire, but this point was not seriously pressed. It was suggested that Mr , the plaintiffs' solicitor, knew from 1941 onwards what the defendants were doing, but it is impossible to impute to a busy solicitor a knowledge which he could only acquire by seeing advertisements in local or farming papers advertising the defendants' activities. No direct information was afforded to him; on the contrary it will be remembered that when in 1942 he made enquiries on behalf of his clients information was studiously withheld from him. I conclude therefore that there has been no acquiescence to disentitle the plaintiff to relief.\"' 31 In v. at pp. 32 and 33 it was held thus: ", "\"I now pass to the second question, that of acquiescence, and I confess at once that upon this matter I have felt no little sympathy for the defendants, and have been not a little envious of the good fortune which has attended the plaintiffs, though no doubt they may justly attribute it to the astuteness of their advisers; but, as has already been said, the defendants have traded openly and (as the Judge found) honestly, beyond any question, in the ordinary course and substantially under this name '' for a very long period of time, since early 1930's. During that time, they have built up (I doubt not) a valuable goodwill associated with that name. If the possibility that the mark 'Electrolux' was infringed is out of the way, and if I disregard for the moment (as I do) the point taken by Mr that in any event for use of 'Electrolux' was a sufficient use for the purpose of Section 26(1) of 'Electnix' (seeing that the two marks were associated). I have no doubt that if the plaintiff had challenged in the courts the right of the defendants to use '' before they have effect to their decision to apply the word 'Electrux' to their cheaper model in lieu of 'Electrolux', they would in all probability have failed, because the defendants' motion to strike the word 'Electrux' off the Register would have succeeded, but the fact is that when the battle was joined, 'Electrux' was no longer vulnerable on that account, unless the defendants can establish that the use was not bona fide, a matter to which I shall come presently. It is, however, said that by the defendants that the plaintiffs have deprived themselves of their legal right or, at least, of any right to the equitable remedy of injunction. ", "Upon this matter, a great deal of learning has been referred to, and we have also had our attention drawn to a number of cases. The latter include the well-known statement in v. by , J. (as he then was) at p. 105. He said this: 'It has been said that the acquiescence which' will deprive a man of his legal rights must amount to fraud, and in my view that is an abbreviated statement of a very true proposition. A man is not to be deprived of his legal rights unless he has acted in such a way as would 'make it fraudulent for him to set up those rights'. Let me pause here to say that I do not understand that, by the word 'fraudulent', the learned Judge was thereby indicating conduct which would amount to a common law tort of deceit. 'What, then, are the elements or requisites necessary to constitute fraud of that description?' In the first place 'the plaintiff must have made a mistake as to his legal rights'. Secondly, the plaintiff must 'have expended some money or must have done some act (not necessarily upon the defendant's land) on the faith of his mistaken belief. Thirdly, the defendant, the possessor of 'the legal right, must know of the existence of his own right which is inconsistent with 'the legal right, must know of the existence of his own right which is inconsistent with' the right claimed by the plaintiff. If he does not know of it he is in the same position 'as the plaintiff, and the doctrine of acquiescence is founded upon conduct with a knowledge' of your legal rights. Fourthly, the defendant, the possessor of the legal right, must know 'of the plaintiff's mistaken belief of his rights. If he does not, there is nothing which' calls upon him to assert his own rights. Lastly, the defendant, the possessor of the legal 'right, must have encouraged the plaintiff in his expenditure of money or in the other acts which he has done, either directly or by abstaining from asserting his legal right'. In reading that passage, it is perhaps necessary to note (because it makes it at first sight a little more difficult to follow) that the positions of plaintiff and defendant as they are usually met with are there transposed, and that one of the parties who is there spoken of as the plaintiff corresponds with the present case with the defendants, and vice versa.\" ", "32 pharmacy v. is case where was quoted with approval. However, on the facts of that case it was held that the plea of acquiescence had not been made, out. ", "33.Now, we come to the principles in relation to the grant of interim injunction. The case in v. makes a reference to the case-law and holds at pages 574-75 as under: ", "\" The principles which should govern the in granting or withholding a temporary injunction in trade mark infringement actions are well-settled : See recent decision v. As a temporary injunction is merely of a provisional nature and does not conclude the rights of the parties in any way, the 26 (1880) 15 Ch D 96: 43 LT 95 27 (1951) 68 RPC 47 will exercise its discretion in favour of the applicant only in strong cases. The plaintiff must make out a prima facie case in support of his application for the ad interim injunction and must satisfy the that his legal right has been infringed and in all probability will succeed ultimately in the action. This does not mean, however, that the should examine in detail the facts of the case and anticipate or prejudice the verdict which might be pronounced after the hearing of the suit or that the plaintiff should make out a case which would entitle him at all events to relief at the hearing. Colman v. , , v. , v. . In fact the will not ordinarily grant an interlocutory injunction if a large amount of evidence is necessary to support the plaintiff s case. The proper course in such a case is to ask for the trial of the action. The injury must be actual or imminent. v. Where the defendant disputes the plaintiff's title to the mark or contends that the plaintiff is not entitled to relief by reason of the acquiescence or delay or other estoppel or of the defendant's concurrent rights, the will be guided by the balance of inconvenience which may arise from granting or withholding the injunction as well as the justice of the cause after considering all the circumstances in the suit. In other words, where the plaintiff s title is disputed or the fact of infringement or misrepresentation amounting to a bar to the action or some other defence is plausibly alleged upon the interlocutory motion, the in granting or refusing the interim injunction is guided principally by the balance of convenience that is by the relative amount of damage which seems likely to result if the injunction is granted and the plaintiff untimately fails or if it is refused and he ultimately succeeds; v. and Co.33, v. ... It is necessary that an application for interlocutory injunction should be made immediately after the plaintiff becomes aware of the infringement of the mark. Improper and unexplained delay is fatal to an application for interlocutory injunction. The interim injunction will not be granted if the plaintiff has delayed interfering until the defendant has built up a large trade in which he has notoriously used the mark. v. , v. 28 (1898) 15 RPC 198 29 (1936) 53 RPC 399 30 (1890) 7 RPC 183 31 (1906) 23 RPC 337 32 (1895) 14 RPC 933 33 (1 881) 45 LT 54 34 (1903) 20 RPC 801 35 (1 894) 12 RPC 17 , v. , v. , v. \" ", "34. In it is held at page 511 as under: ", "\"Where other factors appear to be evenly balanced it is a counsel of prudence to take such measures as are calculated to preserve the status quo. If the defendant is enjoined temporarily from doing something that he has not done before, the only effect of the interlocutory injunction in the event of his succeeding at the trial is to postpone the date at which he is able to embark on a course of action which he has not previously found it necessary to undertake; whereas to interrupt him in the conduct of an established enterprise would cause much greater inconvenience to him since he would have to start again to establish it in the event of his succeeding at the trial. ", "The factors which he took into consideration, and in my view properly, were that 's sutures XLG were not yet on the market; so that had no business which would be brought to a stop by the injunction; no factories would be closed and no work people would be thrown out of work. They held a dominant position in the United Kingdom market of absorbable surgical sutures and adopted an aggressive sales policy.\" ", "35.Again in .40 at page 731 to which decision one of us (, J., as he then was) was a party it was stated thus: (SCC pp. 731- 32, para 9) \"Usually, the prayer for grant of an interlocutory injunction is at a stage when the existence of the legal right asserted by the plaintiff and its alleged violation are both contested and uncertain and remain uncertain till they are established at the trial on evidence. The court, at this stage, acts on certain well settled principles of administration of this form of interlocutory remedy which is both temporary and discretionary. The object of the interlocutory injunction, it is stated: '... is to protect the plaintiff against injury by violation of his rights for which he could not adequately be compensated in damages recoverable in the action if the uncertainty were resolved in his favour at the trial. The need for such protection must be weighed against the corresponding need of the defendant to be protected against injury resulting from his having been prevented from exercising his own legal rights for which he could not be adequately 36 (1902) 19 RPC 574 37 (1909) 26 RPC 89 3 8 (1902) 19 RPC 422 39 (1908) 25 RPC 245 40 1990 Supp SCC 726: 1991 SCC (Cri) 145 ((, J.) 465 compensated. The court must weigh one need against another and determine where the \"balance of convenience\" lies.' The interlocutory remedy is intended to preserve in status quo, the rights of parties which may appear on a prima facie case. The court also, in restraining a defendant from exercising what he considers his legal right but what the plaintiff would like to be prevented, puts into the scales, as a relevant consideration whether the defendant has yet to commence his enterprise or whether he has already been doing so in which latter case considerations somewhat different from those that apply to a case where the defendant is yet to commence his enterprise, are attracted.\" ", "36.In this case we will briefly analyse the materials on record as they now exist to decide the plea of honest and concurrent user of acquiescence. The learned Single Judge in paragraph 18 of his judgment at p. 1271 observes: ", "\"A careful perusal of the above referred documents in particular along with the other voluminous documents, clinch the fact that , the mother of the deponents in the affidavits filed in support of the applications, as well as the counter- affidavit, got the trade mark '' registered long back as early as 1964 and that by the very strenuous efforts, hard work, skill, exertion, devised so many designs and improved the appliances on par with the modem technology and along with other members of the family, viz., husband, sons and daughters were able to start different business concerns as specifically pleaded in the affidavit and reply affidavit and by entering into various agreements among themselves and by remaining as shareholders and Directors in the companies engaged in manufacturing the various domestic power-operated machines like mixies, washing machines and so on by using the trade name and marketed mixies in various categories and numbers. It has to be seen that during the said sojourn, , the present Managing Director of the first respondent was also the Director of the plaintiff's company previously and still continuing as shareholder and that during 1984, the first defendant company was incorporated as private limited company under the Companies Act and in adopting the name '', his mother as well as his father gave written consent to the authority constituted under the Companies Act and that the several number of documents produced on behalf of the applicant as well as the respondents, clearly demonstrate the fact that 's family including her husband, daughter, two sons and the other family members were all directly concerned and involved in all of their sister concerns including the first respondent company and have been engaged in manufacturing the various types of home appliances and power operation machines and being marketed through a common distributor, viz., and Engineers, Madras and all of their accounts were being audited by one and the same auditors concerned and that even to provide the working capital to the first respondent company being run by it appears that in the company of the first respondent, both the mother and the father stood guarantee for a sum of Rs 2,00,00,000 in . All virtually go to show that each and everyone in the family of having involved in almost all the companies incorporated in the Companies Act by entering into agreement or otherwise and having the directorship and shares in almost all the companies and deeply involved in manufacturing either the components, motors and other accessories for their companies' products under the registered trade name and mark, and that accordingly, they are being marketed the same through the company (sic common) distributor.\" ", "37.In paragraphs 19 and 20 of the impugned judgment the learned Judge refers to the documents filed by the respondent. None of these documents throw any light as to the manufacture. It might be that the first respondent was marketing, having regard to the close relationship as mother and son between the plaintiff and the first defendant. This was why remarked: \"There is some evidence showing that the first defendant has been at least marketing domestic mixers allegedly manufactured by since its incorporation. Whether it actually manufactured before September 1991, however, is not possible to answer without proper evidence as to the actual manufacturing of the kitchen mixers by the first defendant.\" (emphasis supplied) ", "38.So, as such there is no evidence of manufacture. As rightly contended by Mr , learned counsel, marketing may not advance the case of the first defendant- respondent. We do not think, as is urged by Mr , learned counsel, either the criminal complaint or the averment in the plaint would amount to implied consent, more so, when no oral evidence has been let in, the parties having chosen to proceed on affidavit and counter-affidavit. ", "39.In 1984 the first defendant-company came to be incorporated. This was for the purpose of diversifying the industrial activity of the family group for manufacturing other technical appliances like washing machines, vacuum cleaners etc. But there is nothing on record to show that the first defendant was manufacturing earlier than the alleged violation of trade mark, copyright and design, as stated in the plaint. ", "40.We find considerable difficulty in appreciating the conclusion of which had failed to note that the proprietor of the trade mark is Again, the complaint of infringement of trade mark is not against but against and . ", "41.It is a settled principle of law relating to trade mark that there can be only one mark, one source and one proprietor. It cannot have two origins. Where, therefore, the first defendant-respondent has proclaimed himself as a rival of the plaintiffs and as joint owner it is impermissible in law. Even then. the joint proprietors must use the trade mark jointly for the benefit of all. It cannot be used in rivalry and in competition with each other. ", "42.The plea of quasi-partnership was never urged in the pleading. As regardscopyright there is no plea of assignment. had failed to notethe plea of honest and concurrent user as stated in Section 12(3) of 1958 Act for securing the concurrent registration is not a valid defence for the infringement of copyright. For all these reasons we are unable to support the judgments of under appeal. We reiterate that on the material on record as is available at present the denial of injunction, once the infringement of trade mark, copyright and design is established, cannot be supported. Pending suit, there will be an injunction in favour of the appellants (the plaintiffs). All the civil appeals will stand allowed. No cost. ", "43. We request to try the suits with utmost expedition. ", "44. We make it clear that whatever we have observed herein will have absolutely no bearing in the trial of the suits which have to be decided independently on their respective merits. ", "470"], "relevant_candidates": ["0000128370", "0000293136", "0000330608", "0000368264", "0001300681", "0001327865"]} {"id": "0001967753", "text": [", J. ", "1. For the facts relevant to this appeal their Lordships refer to the judgment which was delivered in July last in (1932) 35 Bom. L.R. 312, P.C. The re-argument, therein foreshadowed, of the appeal No. 86 of 1930, has taken place, and their Lordships now proceed to consider whether all or any of the three sums in question in that appeal (viz., Rs. 27,000, Rs. 35,000 and Rs. 7,703-13-0) are or is recoverable. ", "2. The principal and most difficult points turn upon the true construction and effect of the Indian Limitation Act , 1908, because their Lordships are of opinion that, apart from any questions of limitation, the three sums in question are all recoverable by the liquidators. ", "3. This is obviously so as regards the Rs. 7,703-13-0. As regards the other two sums, it was contended by the appellants that these were not recoverable upon the ground that in each case the sum was paid as a deposit or earnest to secure the due fulfilment of a contract, and that since the company in each case made default and failed to carry out the contract, the executors were entitled to retain the moneys. Their Lordships are unable to accept this contention, which depends upon a true view of the construction of the respective contracts. Suffice it to say that, having heard the arguments adduced, aad having considered the relevant documents, their Lordships are of opinion that the sums of Rs. 27,000 and Rs. 35,000 were not, nor was either of them, paid as a deposit or earnest money. They were payments in advance or anticipatory payments, and nothing else. ", "4. Their Lordships now proceed to consider the questions of limitation, the solution of which depends, in their view, upon the true construction and effect of the Indian Limitation Act , 1908, alone. Decisions in relation to English statutes do not appear to be of assistance. ", "5. The material section of the Indian Act is Section 3 which runs thus :- ", "Subject to the provisions contained in Sections 4 to 25 (inclusive), every suit instituted, appeal preferred, and application made, after the period of limitation prescribed therefor by the first schedule shall be dismissed, although limitation has not been set up as a defence. ", "Explanation.-A suit is instituted, in ordinary cases, when the plaint is presented to the proper officer ; in the case of a pauper, when his application for leave to sue as a paupar is made ; and, in the case of a claim against a company which is being wound up by the , when the claimant first sends in his claim to the official liquidator, ", "6. Unless the application which the liquidators made on March 26, 1928, was a \"suit instituted\" or an \"application made,\" for which a period of limitation is prescribed by the first schedule, no question of limitation in regard thereto can arise. ", "7. There is no definition of suit in the Act, beyond the provision, contained in Section 2 , that unless there is anything repugnant in the subject or context, \"suit\" does not include an appeal or an application. The word \"suit\" ordinarily means, and apart from some context must be taken to mean, a civil proceeding instituted by the presentation of a plaint. The application of the liquidators would not be a suit within Section 3 , if that section stood alone, unaccompanied by the Explaination. An argument, however, was addressed to their Lordships, founded upon the Explanation, to this effect: That the Explanation shows by its concluding sentence that a claim against a company in compulsory liquidation (even though made by a proceeding not instituted by the presentation of a plaint) is considered to be a \"suit instituted\" within the se words in Section 3 , and that a claim similarly made by or on behalf of such a company must necessarily, or may similarly, be treated as a \"suit instituted\" within the section. Their Lordships are unable to accede to this contention. Even if such a claim against such a company could be held by virtue of the Explanation to be a \"suit instituted\" within Section 3 , there is nothing in the Explanation to justify a similar holding in regard to a claim by such a company. But their Lordships do not accept the view that a claim against such a company (not made by a proceeding instituted by the presentation of a plaint) is by virtue of the Explanation to be considered to be a \"suit instituted\" within the section. The Explanation is not concerned with the question of what is a suit, or is to be considered a suit, within Section 3 . It is addressed to quite a different subject matter. It assumes the existence of a suit which has been instituted by the presentation of a plaint, and is concerned only with the point of time at which that suit is for the purpose of Section 3 to be treated as being instituted. The ordinary rule is stated by the Explanation to be that the suit is instituted when the plaint is presented; but to this two exceptions are prescribed, viz., (1) in the case of a suit by a pauper, the time at which that suit is (for the purposes of Section 3 ) instituted, is to be taken as an earlier date, viz., the date when the application for leave to sue as a pauper was made ; and (2) in the case of a suit against a company which is being wound up by the , the institution of the suit is (for the purposes of Section 3 ) advanced also to an earlier date, viz., the date when the claim was first sent in to the official liquidator. Their Lordships are unable to find in an Explanation, which on its face only deals with the point of time at which suits are instituted within the meaning of Section 3 , any sufficient justification for extending the meaning of the word 'suit' in that section. ", "8. The application by the liquidators cannot, therefore, be dismissed as being a \"suit instituted\" after the prescribed period of limitation. ", "9. The application of the liquidators must, therefore, be treated as an \"application made\" under Section 3 ; and the next enquiry must be whether any period of limitation is \"prescribed therefor by the first schedule\" to the Indian Limitation Act . It is common ground that the only Article in that schedule which could apply to such an application is Article 181: but a series of authorities commencing with v. (1880) I.L.R. 7 Bom. 213 has taken the view that Article 181 only relates to applications under the Code of Civil Procedure, in which case no period of limitation has been prescribed for the application. But even if Article 181 does apply to it, the period of limitation prescribed by that Article is three years from the time when the right to apply accrued, which time would be not earlier than the date of the winding up order, March 26, 1926. The application of the liquidators was made on March 26, 1928, well within the three years. The result is that from either point of view the application by the liquidators, if otherwise properly made under and within the provisions of Section 186 of the Indian Companies Act is not one which must be dismissed by reason of Section 3 of the Indian Limitation Act. It is either an application made within time, or it is an application made for which no period of limitation is prescribed. The case may be a casus omissus. If it be so, then it is for others than their Lordships to remedy the defect. ", "10. There is, however, another aspect of the case in which the last-mentioned Act plays a most important part, and that is in considering whether the three sums which the liquidators seek by their application to recover from the appellants were at the date of that application \"money due\" within the meaning of Section 186 . If they were not, then the section had no application and the would have had no power to make the order which it made. ", "11. From this point of view it is necessary to treat the three items separately, for the purpose of seeing whether if on March 26, 1928, the liquidators acting under the powers conferred upon them by Section 179 (a) of the Indian Companies Act had in the name of the company instituted a suit against the testator's executors for the recovery of any of those items, that suit would of necessity have been dismissed by reason of the Indian Limitation Act . ", "12. As regards the Rs. 35,000, this sum, whether paid under a void agreement with the company, or paid without the company's knowledge or authority, was (subject to a point to be mentioned later), immediately after payment, recoverable by the company as money had, and received. In other words, it was repayable on September 13, 1922. The period within which a suit by the company to recover the amount would have to be instituted is, under Article 62 of the first schedule, three years. The debt was accordingly time-barred both before the date of the winding-up order March 26, 1926, and before March 26, 1928. ", "13. In regard to the item Rs. 27,000, the company could hare recovered this by a suit instituted before the expiry of the period of three years named in Article 51 in the first schedule, a period which in their Lordships' view began to run on July 1, 1923, when the second shipment of goods fell to be delivered under the relevant contract. This debt was accordingly not time-barred by suit at the date of the winding-up order but was so time-barred when the liquidators made their application under Section 186 . ", "14. In regard to the item Rs, 7,703-13-10, balance of account, a suit by the company to recover it would fall within Article 85 of the first schedule and would have to be dismissed if not instituted within three years of March 31, 1924, being the end of the last accounting year on which the last item admitted or proved was entered in the account. This item is in the same situation for the matter now under consideration as is the second item. The important feature for this purpose is the fact that all three items were statute-barred by suit when the liquidators made their application under Section 186 . If on March 26, 1928, the liquidators, instead of proceeding in their own name as applicants under Section 186 , had in pursuance of their powers under Section 179 (a) already referred to instituted a suit in the name of the company by the presentation of a plaint, the must of necessity have dismissed that suit under the Indian Limitation Act . ", "15. Now, in considering the meaning and effect of Section 186 it is impossible to overlook the fact that it is verbatim identical with the corresponding section in the legislation of this country, a section which dates back some seventy years to 1862, and which has appeared in our company legislation ever since. It is, therefore, a section with an ancestral history. Three features of the section call for notice: (1) It is concerned only with moneys due from a contributory, other than money payable by virtue of a call in pursuance of the Act. A debtor who is not a contributory is untouched by it. Moneys due from him are recoverable only by suit in the company's name. (2) It is a section which creates a special procedure for obtaining payment of moneys ; it is not a section which purports to create a foundation upon which to base a claim for payment. It creates no new rights. (3) The power of the to order payment is discretionary. It may refuse to act under the section, leaving the liquidator to sue in the name of the company, and it will readily take that course in any case in which it is made apparent that the respondent under this procedure, if continued, would be deprived of some defence or answer open to him in a suit for the same moneys. ", "16. The old Section 101 of the English Act of 1862 has ever since 1866 been judicially interpreted and administered in accordance with the views expressed in Stringer's Case (1869) 4 Ch. App. 475 viz., that the section is one which provides summary proceedings against debtor-contributories to avoid proceedings in different and to permit a single proceeding in the winding-up -but \"in those summary proceedings every objection is just as open to the person sought to be charged as it would have been if a bill had been filed.\" (p. 484.) ", "17. In this country it is difficult to conceive a case in which, so far as limitation is concerned, the section should so operate as to deprive a man of a defence to a claim made by the liquidator which would have been effective against the same claim if brought against him by an action in the company's name. ", "18. Whether, in view of the particular terms of the Indian Limitation Act already referred to, such a case could happen in India depends upon the meaning to be attributed to the words in the section \"any money due from him or from the estate of the person whom he represents to the company.\" And their Lordships are satisfied that the position in this respect is, in India, the same as in this country, for the reason that in view of the place and context in which these words are found, they must be confined in their Lordships' judgment to money due and recoverable in a suit by the company, and they do not include any moneys which at the date of the application under the section could not have been so recovered. ", "19. Their Lordships are glad to find that this view has already prevailed in India, In the case of (1022) I.L.R. 4 Lah. 109, it was held that a debt time-barred (and therefore unenforceable in a suit) could not be enforced by a summary order under Section 186 , on the ground that the section does not create new liabilities or confer new rights, but merely creates a summary procedure for enforcing existing liabilities. It is true that so far as can be gathered from the report it would seem probable that the debt there in question had become time-barred before the liquidation began, but the decision is not based upon that fact, but upon a view of the section coinciding with the views expressed long ago in 's Case. ", "20. The learned Judges, in the present case, took the erroneous view that once the winding-up commenced there could be no further application of the rule of limitation in regard to any debt due to the company and not then already time-barred. Their Lordships know of no justification for this view. In this respect there is no analogy between the position of a debtor to, and a creditor of, a company in liquidation. ", "21. The learned Judges also considered that the Lahore case was in conflict with a decision in , (1916) I.L.R. 38 All. 347. This, however, is a misconception. The last-mentioned case had no relation to Section 186 . It was a ease relating to money due on shares in the company which was in liquidation, the liability for which on a winding-up became a statutory liability under Section 156 of the Indian Companies Act, 1918. ", "22. In their Lordships' opinion the case of was rightly decided and accordingly there was no power in the Court under Section 186 to order payment to the liquidators of any of the three items in question. ", "23. The liquidators made a new submission upon the occasion of the reargument in regard to the sum of Rs. 35,000. They claimed that under Section 65 of the Indian Contract Act (IX of 1872) they only became entitled to recover the Rs. 35,000 when the agreement under which it was paid was discovered to be void, and that this discovery was not made until the litigation which culminated in the judgment of May 14, 1929, so that this right never became time-barred. Their Lordships cannot accede to this contention. In the absence of special circumstances (and none exist here) the time at which an agreement is discovered to be void within the meaning of Section 65 is the date of the agreement, viz., September 13, 1922 (see (1) ", "24. Their Lordships are of opinion that this appeal should be allowed and that the decree of May 14, 1929, should be set aside and that in lieu thereof a decree should be made dismissing the application of the liquidators with costs; and they will humbly advise His Majesty accordingly. The respondents must pay the appellants' costs of this appeal."], "relevant_candidates": ["0000149572", "0001129424", "0001203995", "0001815362", "0059680770"]} {"id": "0012234920", "text": ["CASE NO.: Appeal (civil) 3641 of 1998 PETITIONER: AIR INDIA RESPONDENT: . DATE OF JUDGMENT: 31/01/2000 BENCH: G.T. NANAVATI & S.N. PHUKAN JUDGMENT: ", "JUDGMENT 2000 (1) SCR 505 with C.A. No. 3642 of 1998 The Judgment was delivered by , J. ", "Both these appeals arise out of the judgment of Kerala High Court in Writ Appeal No. 462 of 1999. (hereinafter referred to as '') had filed that appeal against the decision of a learned Single Judge of that High Court in O.P. No. 25560 of 1998 whereby its said petition was dismissed, had challenged the action of (for brevity sake referred to as the '') of awarding contract for ground handling services at the new Cochin Airport at Nedumbassery to The learned single Judge held that the impugned action of was neither arbitrary nor illegal. On appeal of that Court held that the said action was violative of principles of natural justice, arbitrary and illegal ", "2. is a public sector undertaking. Some other public sector undertakings and the State of Kerala are its shareholders. It has been established for setting up and maintaining a new International Airport at Cochin. For awarding a contract for ground handling facilities at the new Airport it invited offers by writing letters to some companies having experience of that type. The letter were written on 12-11-1997 to ; and six others. Proposals were to be submitted by 31-12-1997. , , of Dubai, of Hong Kong and - responded. Proposals of some of them contained alternative proposals also. On 13-7-1998 again wrote to them to make their best offers on or before 28-7-1998. submitted its proposal on 20-7-1998 did so on 28-7-1998 ", "3. The Committee constituted by for evaluation of the offers met on 28-9-1998. It found that , , and were on par as regards technical competence, organizational capacity and past experience. It took note of the fact that and are Indian organisations, operate mainly in India and have better proven adaptability for operating in Indian conditions. Out of those two it recommended for awarding the work. On 11-8-1998 wrote a letter to recommending for awarding the contract on the ground that is the national carrier and has better experience. Thereafter a meeting took place between the Managing Director of and the Chief Minister of Kerala. That was followed by a letter dated 29-10-1998 by Mr. , Managing Director of to the Chief Minister of Kerala seeking an opportunity to make a more detailed presentation to the Board of on the advantages would derive if was appointed bits exclusive handling agent. met on 7-11-1998 and decided to have a detailed discussion with before taking a final decision and informed it to give a presentation before the Board on 27-11-1998. Having come to know about this development wrote a letter on 10-11-1998 to the Chief Minister of Kerala pointing out that their company is also an India company and they also have experience of over 30 years in ground handling work. It also took exception to the effort made by to revise its offer on the ground that it was unethical and deserved to be condemned by the Board. It again wrote to the Chief Minister on 12-11-1998 against giving preference to a national carrier in view of the policy of liberalisation. On 23-11-1998 wrote to that it was extremely perturbed over the fact that was given a further opportunity to make a presentation to the Board and requested it not to go back upon its earlier decision to give the contract to . It also warned that not adhering to its earlier decision would be a retrograde step and shake the confidence of the people in fairness and impartiality of . gave the presentation and by its letter dated 1-12-1998, reaffirmed its proposal with some changes as discussed and requested to accept it as it was better than the offer made by any other party. again protested by its letter dated 7-12-1998 and informed that to accept the revised offer of and not to accept its offer would be unfair and unethical and violative of Limited Global Competitive Building Norms. On 12-12-1998 the first respondent awarded the contract to ", "4. filed a writ petition in challenging that action of . Its contention was that its offer was the highest and it had fulfilled all the conditions. The offer given by did not come anywhere near their offer, yet the contract was given to because of influence exerted by and the Secretary of . It was also challenged on the ground that had not acted fairly and impartially as it had carried on negotiations with behind the back of and no opportunity was given to to give a better offer. In the counter affidavit filed on behalf of it was stated that this was not a case where tenders were invited. It was a project to be implemented by raising finances from various sources and, therefore, it was decided to invite offers from reputed agencies in order to decide best terms and conditions and then to award the contract to the best suited party in order to make the project viable and successful. It was further stated that individual offers were assessed considering the background and infrastructure of the companies, their financial capacity, expertise and future benefits likely accrue to . While awarding the contract to what had weighted with it was, apart from it selection by the evaluating Committee, that it is a public sector unit, the national carrier under and that it had offered to support in a big way by showing its willingness in equity participation It had also taken into consideration the fact that was not a airline operator like and its interest and expertise was limited to ground handling work alone. had also offered to help in improving the revenue of by increasing Air Traffic through the Cochin Airport. Thus, on a comparative analysis of the offers made by and it was found that the offer made by was better and more beneficial to . The petition was heard by a learned Single Judge of who held that there was no illegality, arbitrariness or unreasonableness in the decision making process of and the decision was taken bona fide after evaluating both the offers and on being satisfied that in the matter of experience, expertise, infrastructure and financial capacity the offer of was superior and more beneficial. As regards the allegation of actual mala fides the learned single Judge held that the pleading in that behalf was very vague and scanty ", "5. The matter was then carried by in appeal before the same . The Division Bench held that it was a case of public tender. It also held that though the decision of evaluation committee was only recommendatory and not binding on of , the fact that the evaluation committee had considered all the relevant aspects and found as the most competent party and yet no reasons were disclosed for explaining what prompted to take a different view was clearly indicative of the fact that was influenced in its decision making process by and the Secretary of . As regards the justification disclosed by in its counter affidavit held that it was \"not impressed with the reasons given in the counter affidavit as it was well known that the reasons given in the counter affidavit cannot be accepted for what has happened at the time of acceptance of the offer\" ", ". It was also of the view that if the other tenderers had also been invited for negotiations by then possibly they would have given better offers and pointed out demerits of the offers made by the rival tenderers. It held that was influenced by the threat to the effect that if was not given the contract, the International Airport will be bereft of flights as will not allow other flights to land there. It then held that the action of in awarding contract to was arbitrary, illegal and opposed to the principles of natural justice. It allowed the appeal, cancelled the contract in favour of and directed to re-consider the valid tenders once again and, if necessary, to call all those tenderers for negotiations before finalising the contract ", "6. Challenging this decision of , has filed Civil Appeal No. 3641 of 1999 and has filed Civil Appeal No. 3642 of 1999. Mr. , learned senior counsel appearing for and Mr. , learned senior counsel appearing for contended that has gone wrong in its conclusion as it adopted a wrong approach in a matter of this type. They submitted that committed a grave error in considering this to be a case of public tender. They also submitted that the decision of to award the contract to was taken bona fide in the financial and overall interest of and, therefore, while exercising its power under Article 226 ought not to have interfered as no substantial amount of public interest was involved ", "7. The law relating to award of a contract by the , its corporations and bodies acting as instrumentalities and agencies of the Government has been settled by the decision of this in 1979 (3) SCC 488 ), 1981 (1) SCC 568 ), . 1985 (1) SCC 260 = 1984 (2) SCALE 819), 1994 (6) SCC 651 = 1995 (1) Arb. LR 193), 1997 (1) SCC 134 = 1996 (8) SCALE 417), and . 1999 (1) SCC 492 = 1999 (1) Arb. LR 431 (SC). The award of a contract, whether it is by a private party or by a public body or the , is essentially a commercial transaction. In arriving at a commercial decision considerations which are of paramount are commercial considerations. The can choose its own method to arrive at a decision. It can fix its own terms of invitation to tender and that is not open to judicial scrutiny. It can enter into negotiations before finally deciding to accept one of the offers made to it. Price need not always be the sole criterion for awarding a contract. It is free to grant any relaxation, for bona fide reasons, if the tender conditions permit such a relaxation. It may not accept the offer even though it happens to be the highest or the lowest. But the , its corporations, instrumentalities and agencies are bound to adhere to the norms, standards and procedures laid down by them and cannot depart from them arbitrarily. Though that decision is not amendable to judicial review, the can examine the decision making process and interfere if it is found vitiated by mala fides, unreasonableness and arbitrariness. The , its corporations, instrumentalities and agencies have the public duty to be fair to all concerned. Even when some defect is found in the decision making process the must exercise its discretionary power under Article 226 with great caution and should exercise it only in furtherance of public interest and not merely on the making out of a legal point. The should always keep the larger public interest in mind in order to decide whether its intervention is called for or not. Only when it comes to a conclusion that overwhelming public interest requires interference, the should intervene ", "8. In view of this settled legal position, Mr. , learned senior counsel appearing for rightly and fairly did not dispute that was not bound to accept the highest offer or that it was entitled to enter into negotiations with . What he contended was that ought to have treated all the tenderers fairly. As was given an opportunity to give a presentation and revise its offer it ought to have given a chance to also to have its say with respect to the offer made by and to match its offer with the offer of . He submitted that the evaluation committee had recommended for awarding the contract after considering all the relevant factors and, therefore, it was incumbent upon to disclose why they different from the said recommendation and decided to accept the offer of . He also submitted that the decision of was vitiated because of the influence exercised by and and also because it took into consideration an irrelevant consideration that is a public sector undertaking and a national carrier ", "9. What was emphasised by Mr. and Mr. is that was incorporated to set up a new private International Airport. At all airports, permissions for operating aircraft, maintenance, licensing of crew and flying schedules of airlines is controlled by . Applications for hangar space, landing and parking facilities and ground handling are made to and granted by . This was the first attempt to privatise. Therefore, , in order to make its project viable and successful, after taking into consideration various factors, decided to entrust the task to providing ground handling services for all airlines operating from the airport to one single agency. For achieving this purpose it invited offers by writing letters to eight reputed agencies to enable it to decide the best terms and conditions for awarding the contract and to select the best agency. They submitted that, for these reasons, it did not choose to adopt the public tender mode. In its counter affidavit filed in this position was made clear. What was stated in the counter affidavit was as under \"The object of inviting their offers was only to get terms and conditions of the respective companies for consideration by of this respondent and to select that best suited to the interest of the respondent. Being a new project implemented by raising finance from various sources all efforts were made to make the project viable. Hence when Ext. R1(a) letter was sent inviting offers the paramount consideration was to get the best offer for the benefit of the 1st respondent. There was no minimum estimated amount or other conditions for acceptance and rejection like the usual tender procedure.\" ", " was also of the view that if the offers were made only pursuant to the letter dated 12-11-1997 the respondents would have a good case. But in view of decision to be fair and the 's letter dated 13-7-1998 calling upon the tenderers to give the best offer before it took a final decision and informing them that the contract period would be 10 years and the subsequent letter dated 5-8-1998 requiring the tenderers to give a bank guarantee, was bound to treat this case as a case of public tender and for that reason it was not open to it to say that it was free to accept that offer which was best suited to it. It is, however, not necessary to deal with this aspect more elaborately and point out how view is wrong as it was not disputed by the learned counsel appearing for that it was open to not to accept the highest offer of if it had good reasons to do so. It was at no point of time declared by that it would accept the highest offer or accept the offer on a particular basis. All along it had made clear that it would accept that offer which was found to be the best in their interest ", "10. The only point that really falls for consideration is whether had acted fairly after it had invited fresh offers by its letter dated 13-7-1998. It was forcefully submitted by Mr. that after had evaluated the proposals and recommended for the Job it was unfair on the part of to have permitted to make a fresh presentation and revise its terms. Even while conceding that had a right to enter into negotiations even at that stage, it was submitted that also should have been invited for negotiations and informed about the revised terms of . It was submitted that like , should have been given an opportunity to match the offer made by . From the letter written by to on 13-7-1998 and similar letters written to others also, it appears that had, in its meeting held on 29-6-1998, taken certain decisions and felt that in fairness all eligible agencies should be requested to give their best offers. had submitted its offer on 20-7-1998 and stated therein that its offer was open for negotiations. had submitted its offer on 28-7-1998. It was made on the basis of certain assumptions. had in all received five offers. constituted for evaluation of offers did not consider the offer of as it had not submitted the required bank guarantee. The other four agendes, namely, , , and , were found on par as far as technical competence, organisational capacity and past experience was concerned. It, however, shortlisted and on the ground that they are Indian organisations, operate mainly in India and has better proven adaptability for operating in Indian conditions. It then recommended for undertaking the ground handling services without giving any reason for its preference for . While making the decision the Committee observed that it would be for to consider whether any negotiation should be held with the qualified agendes. had then met on 7-11-1998 and after taking note of the minutes of the high level Committee and taking note of the fact that is a public sector undertaking and a national carrier, decided to have a detailed discussion with before taking a final decision. It, therefore, invited the Managing Director of for giving a presentation before the Board on 27-11-1998. It was also felt necessary to take a final decision in its next meeting to be held on 27-11-1998 as the matter was pending since long and it was necessary to solve the financial crunch of . had protested against giving of an opportunity to to make a presentation by its letters dated 12-11-1998 and 23-11-1998 on the ground that what was being done by was improper and in violation of global competitive bidding norms. In spite of the protest of of permitted to make a presentation for outlining in detail its ground handling capabilities, packages of services which it wished to offer and other relevant advantages including financial. by its letter dated 1-12-1998 recapitulated the details of the offer which it had already made, and the subsequent presentation and discussion on 27-11-1998. The said letter discloses that some changes were made by in its original offer to make it more acceptable to . In that letter it was also indicated that it would try to enhance and other ' - domestic and international operations through and pointed out that only through maximisation of operations this new venture can be a profitable one at an early date. again by its letter dated 7-12-1998 reiterated that its offer was the highest (most favourable to ) and that it would be unfair to accept the revised bid of . In spite of the protests of , , by its letter dated 12-12-1998, informed that had decided to accept the revised offer of ", "11. This narration of facts makes it clear that all along, after had recommended for awarding the contract, what was contending was that having accepted the limited global competitive bidding norms and having decided 28-7-1998 as the last date for inviting final offer, it was not open to it thereafter to negotiate with behind the back of and permit to revise its offer. Even though had written protest letters, it had not requested to give it any opportunity to negotiate or to improve upon its offer. The decision of was obviously not the final decision and certainly it was not binding on who were the final authority to take the decision. , at the meeting held on 7-11-1998, considered the proposals of and and appears to have taken a tentative decision to award the contract to and, therefore, called it for negotiations with a view to have better terms and take the final decision. did take the final decision on 27-11-1998 as agreed to make its offer more beneficial to . That becomes apparent from 's letter dated 1-12-1998. having taken tentative decision on 7-11-1998 there was no point in calling thereafter for any negotiation. It may be recalled that was recommended over by only because 's financial rating was found higher. What is significant to note is that even had in its minutes noted that financial rating cannot be the sole criterion for taking the final decision. Moreover, in a commercial transaction of such a complex nature a lot of balancing work has to be done while weighing all the relevant factors and the final decision has to be taken after taking an overall view of the transaction. It is true that even though had called upon to produce the minutes of the meeting of held on 27-11-1998 the same was not made available to . But that did not entitle to draw any adverse inference. had not called upon to produce those minutes ", "12. As regards the merits of 's proposal, it was contended by Mr. that all the three offers of were superior in terms of parameters laid down by than offer. He submitted that even after unilaterally raised the license fee of from 17 per cent to 20 per cent in the 10th year to match 's offer and imposed a condition that would not sub-contract, it did not become comparable with the offer of as did not offer to pay 2 per cent bonus in license fee. It was also submitted that representation that it would be able to bring more traffic was illusory and for that reason also proposal cannot be regarded as superior or even comparable with the proposal of . We do not think that did any wrong in taking into consideration the fact that is an airline and being a national carrier would be in a position to bring more traffic of and other domestic lines if it was awarded the contract. As regards the merits of the rival offers, we do not think it proper to look at only the financial aspect and hold that did not accept 's offer, even though it was better, because it wanted to favour or that it had acted under the influence of and . In a commercial transaction of a complex nature what may appear to be better, on the face of it, may not be considered so when an overall view is taken. In such matters the cannot substitute it's decision for the decision of the party awarding the contract. On the basis of the material placed on record we find that bona fide believed that involving a public sector undertaking and a national carrier would, in the long run, prove to be more beneficial to For all these reasons it is not possible to agree with the finding of the High that had acted arbitrarily and unreasonably and was also influenced by extraneous considerations during its decision making process ", "13. We, therefore, allow these two appeals, set aside the judgment of of in Writ Appeal No. 462 of 1999 and confirm the decision of the learned Single Judge in O.P. No. 25560 of 1998"], "relevant_candidates": ["0000096932", "0000884513", "0000952082", "0001102476", "0001171702", "0001281050"]} {"id": "0107329862", "text": ["IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO. 7292 OF 2013 (Arising out of S.L.P. (C) No. 14007 of 2012) Union of India and Ors. ... Appellants Versus ...Respondent J U D G M E N T ", ", J. ", "Leave granted, ", "2. This appeal by special leave is directed against the judgment and order dated 9.5.2011 passed by at Jodhpur in D.B. Civil Writ Petition No. 11838 of 2010 whereby has concurred with the view expressed by , Jodhpur Bench at Jodhpur (for short \u201cthe tribunal\u201d) in O.A. No. 109 of 2008 wherein the tribunal had quashed the order passed by the competent authority re-fixing his pay prior to his retirement and directing recovery of the amount paid from 3.12.1994 to 31.12.2007. ", "3. The undisputed facts are that the respondent was appointed as a Gangman on JU Division on 15.1.1966 as a substitute and was regularized in the year 1972. He was promoted to the post of Store Keeper in October, 1977 and thereafter, he went on deputation to in December, 1977. He was given the post of PW in the with effect from 10.4.1981 in the pay scale of Rs.380-560. On completion of the training he came in the grade of Rs.1400-2300 by of the railways. Subsequently, when there was a regular selection for the post of in his parent department, he was called to participate in the selection which he did and being declared successful, he joined in the said promotional post on 3.12.1994. While giving him posting in the year 1994, his pay was fixed keeping in view the benefit he had availed while he was working in the . When the date of superannuation approached and pension was going to be determined, it was noticed by the accounts department that he had been given excess pay due to erroneous fixation of pay scale and, accordingly, a communication was sent on 22.10.2007 refixing his pay and directing recovery of the excess sum. ", "4. Being dissatisfied with the said action, the respondent approached the tribunal which, placing reliance on the authorities in and others, and , quashed the order of refixation and directed the benefit of pension be extended to him on the basis of pay he was actually drawing before the retirement within three months failing which the employer would be liable to pay interest at the rate of 15% per annum. ", "5. Grieved by the aforesaid order, and its functionaries approached , which, by the impugned judgment, came to hold as follows: - ", "\u201cIn our considered opinion, no flaw can be noticed in the reasoning arid the conclusion of the while allowing the Original Application. In the first place, it is based on the decision quoted in the order itself. Secondly, there is no distinction brought about the facts of the case that is subject matter of the case in hand the one before the . Thirdly the impugned directions for fixation of the pension on the basis of last drawn pay cannot be said to be either illegal or arbitrary or against any provision of Act or/and rule made thereunder.\u201d ", "6. On the basis of aforesaid analysis the writ court dismissed the petition. ", "7. Criticising the orders passed by the tribunal as well as by Mr. , learned senior counsel for the appellants has submitted that when the respondent was sent on deputation and came back to the parent department accepting promotion he was to be treated at par with other promotees and could not have been entitled to draw higher pay scale solely on the ground that he was getting a better pay while he was on deputation. It is urged by him when the respondent had no legal right to get a particular pay scale and it was wrongly fixed and could only be noticed prior to his retirement it became obligatory on the part of the authorities to refix the pay and accordingly determine the pension and hence, the action of the authorities could not have been found fault with. It is his further submission that neither the tribunal nor has addressed the issue pertaining to the entitlement of the respondent but directed the pension to be paid on the basis of the pay drawn by him before the retirement. Learned counsel would further contend that as far as recovery is concerned, the petitioners have no intention to recover the same. ", "8. Ms. , learned counsel for the respondent relying on the authorities which have been pressed into service by the tribunal and accepted by urged that pay protection was given when the respondent came back to the parent cadre on promotion and, therefore, the said protection could not have been withdrawn on the foundation that there was an erroneous fixation of pay. It is argued by her that when a long time has lapsed from the date of repatriation on promotion to the parent cadre, steps for refixation immediately prior to superannuation of the respondent is neither permissible in law nor is it equitable. Learned counsel has canvassed that in any case there cannot be recovery of the same as there had been no misrepresentation by the respondent to avail the said benefit. ", "9. From the aforesaid rivalised submissions two questions, namely, (i) whether the pay of the respondent was erroneously fixed and (ii) whether there could have been a direction for recovery of the amount alleged to have been excessibly paid to the respondent, emerge for consideration. ", "10. It is perceptible from the orders passed by the tribunal as well as by that they have set aside the order dated 22.10.2007 placing reliance on three authorities. In (supra), a two-Judge Bench dealt with regularization and permanent absorption. It also dealt with the entitlement of the right of the employees to continue in the concerned project or to resist reversion back to the cadre or to enjoy a higher promotion merely on the basis of locally provisional promotion granted to them in the project in which they had been employed at a particular point of time. The Court has observed that if the stand of the petitioners therein was to be accepted, it would operate inequitably so far as the regular employees in the open line department are concerned. Thereafter, the learned Judges proceeded to state as follows: - ", "\u201c......while the petitioners cannot be granted the reliefs as prayed for in the writ petition, namely, that they should not be reverted to a lower post or that they should be treated as having been promoted by reason of their promotion in the projects, nevertheless, we wish to protect the petitioners against some of the anomalies which may arise, if the petitioners are directed to join their parent cadre or other project, in future. It cannot be lost sight of that the petitioners have passed trade tests to achieve the promotional level in a particular project. Therefore, if the petitioners are posted back to the same project they shall be entitled to the same pay as their contemporaries unless the posts held by such contemporary employees at the time of such reposting of the petitioners is based on selection.\u201d ", "11. The learned counsel for the respondent would place reliance on the last part of above quoted paragraph but the same, we are inclined to think, does not in any way buttress the submission put forth by the learned counsel for the respondent. ", "12. In (supra) the issue was whether an employee substantially holding Group \u2018D\u2019 post can claim regular promotional post, i.e., Group \u2018C\u2019. The Court in that context observed that the practice adopted by the of taking work from employees in Group \u2018D\u2019 post on higher Group \u2018C\u2019 post for unduly long period legitimately raises hopes and claims for higher posts by those working in such higher posts. As the is utilising for long periods the services of employees in Group \u2018D\u2019 post for higher post in Group \u2018C\u2019 carrying higher responsibilities, benefit of pay protection, age relaxation and counting of their service on the higher post towards requisite minimum prescribed period of service, if any, for promotion to the higher post must be granted to them as their legitimate claim. But they cannot be granted relief of regularising their services on the post of Storeman/Clerk merely on the basis of their ad hoc promotion from open line to higher post in the project or construction side. After so stating the Court opined thus:- ", "\u201cWithout disturbing, therefore, orders of the and the appellants are held entitled to the following additional reliefs. The pay last drawn by them in Group \u2018C\u2019 post shall be protected even after their repatriation to Group \u2018D\u2019 post in their parent department. They shall be considered in their turn for promotion to Group \u2018C\u2019 post. The period of service spent by them on ad hoc basis in Group \u2018C\u2019 post shall be given due weightage and counted towards length of requisite service, if any, prescribed for higher post in Group \u2018C\u2019. If there is any bar of age that shall be relaxed in the case of the appellants.\u201d ", "13. Reading the decision in entirety we are persuaded to think that the directions were issued in the special fact- situation and, in any case, it does not pertain to a situation where someone gets repatriated on being selected to a higher post and on that foundation would claim pay protection and consequent fixation of pay in the selection post. ", "14. In (supra) the was dealing with fixation of pay under FR 22-C and as there was a wrong fixation, the question of recovery arose. The , relying on earlier decisions, opined thus:- ", "\u201cThe relief against recovery is granted by courts not because of any right in the employees, but in equity, exercising judicial discretion to relieve the employees from the hardship that will be caused if recovery is ordered. But, if in a given case, it is proved that the employee had knowledge that the payment received was in excess of what was due or wrongly paid, or in cases where the error is detected or corrected within a short time of wrong payment, the matter being in the realm of judicial discretion, courts may, on the facts and circumstances of any particular case, order for recovery of the amount paid in excess. , , , , Col. (.) v. , , and Bihar SEB v. .\u201d ", "15. From the aforesaid decision it is clear as day that it has been relied upon to by the tribunal as well as by for the purpose that there should be no recovery. Mr. has conceded that steps shall not be taken for any recovery, and we think that the concession has been justly given. Be it noted, the aforesaid decision does not assist the respond to pyramid the submission of pay fixation and grant of pension. ", "16. the Court was dealing with a fact-situation where there was withdrawal of pensionary benefits. Adverting to the concept of natural justice and, relying on the decisions in and , the Court ruled thus: - ", "\u201c16. It is not in dispute that before directing revision of the pension, etc. payable to the private respondents, did not give them action-oriented notice and opportunity of showing cause against the proposed action. Therefore, it must be held that the direction given by to revise the retiral benefits including the pension payable to the respondents was nullity. ", "17. Dehors the above conclusion, we are convinced that the action taken by the appellants to revise and reduce the retiral benefits payable to the respondents was ex facie arbitrary, unreasonable and unjustified and the learned Single Judge did not commit any error by declaring that did not have the jurisdiction to unilaterally alter/change the option exercised by the writ petitioners under Section 12-A(4)(b) read with Section 12-A(4-C).\u201d ", "17. The aforesaid conclusion was arrived at as as such could not have invoked the terms of the memorandum of settlement to justify the directives and retiral benefits payable to the respondents. The aforesaid decision has to be read in the context of its facts and not to be construed as a precedent for the proposition that if the pay has been erroneously fixed that cannot be revised even if the facts are absolutely clear and undisputed. ", "18. We may note with profit that Mr. , learned senior counsel, has submitted that the respondent was holding an ex-cadre post and it was the duty of the employer to ask him to participate in the selection in the promotional post, in the parent cadre. The respondent, being conscious of his position and to have the status, appeared in the selection process, got selected and joined the parent cadre. The learned senior counsel would submit that under a mistaken pression his pay was fixed in the promotional post in the parent cadre as a consequence of which he got more than the promotees in his batch and, hence, the same was required to be rectified and the employer was within its right to do so. ", "19. It is not in dispute that the respondent was sent on deputation and his lien in the parent department continued and hence, it was obligatory on the part of the authorities in the parent department to intimate him when the selection process for the higher post was undertaken as he had already come within the zone of consideration. In this context, we may refer with profit to the authority in wherein the Court was dealing with a case whether the employee had got a promotion in the department to which he was sent on deputation. While considering the effect of the said promotion after repatriation the Court observed thus:- \u201cthat the appellant\u2019s promotion as junior draftsman and proposed promotion as Surveyor-cum-Draftsman in cannot confer any rights on him in his parent department. When he left and joined he was a tracer and he can go back to or any other department of only to his original post i.e. as tracer, subject to the modification that, if in the meantime he had qualified for promotion to a higher post, that benefit cannot be denied to him. \u201d Thus, the repatriation has to be to the original post and benefit of promotion in the department to which an employee is deputed is of no consequence subject to his entitlement of status otherwise available in the parent department. ", "20. it has been held that when a deputationist is repatriated he cannot claim promotions in the parent department on the basis on officiation in a higher post in the borrower organization. ", "21. , the learned Judges elaborately adverted to the concept of deputation and the right of a deputationist and in that context opined thus:- ", "\u201cThe concept of \u201cdeputation\u201d is well understood in service law and has a recognised meaning. \u201cDeputation\u201d has a different connotation in service law and the dictionary meaning of the word \u201cdeputation\u201d is of no help. In simple words \u201cdeputation\u201d means service outside the cadre or outside the parent department. Deputation is deputing or transferring an employee to a post outside his cadre, that is to say, to another department on a temporary basis. After the expiry period of deputation the employee has to come back to his parent department to occupy the same position unless in the meanwhile he has earned promotion in his parent department as per the Recruitment Rules.\u201d ", "22. In the case at hand, as stated earlier, the respondent was getting higher scale of pay in the post while he was holding a particular post as a deputationist. After his repatriation to the parent cadre on selection to a higher post he was given higher scale of pay as it was fixed keeping in view the pay scale drawn by him while he was working in the ex-cadre post. Such fixation of pay, needless to say, was erroneous and, therefore, the authorities were within their domain to rectify the same. Thus analysed, the irresistible conclusion is that the tribunal and have fallen into error by opining that the respondent would be entitled to get the pension on the basis of the pay drawn by him before his retirement. ", "23. Consequently, the appeal is allowed in part and the orders passed by the tribunal as well as by are set aside directing fixation of pension on the base of pay drawn by the respondent. However, as conceded to by Mr. , there shall be no recovery from the excess amount paid to the respondent. There shall be no order as to costs. ", ".................................J. ", "[Anil R. Dave] .................................J. ", "[Dipak Misra] New Delhi August 27, 2013. ", "----------------------- ", "[1] (2005) 11 SCC 301 [2] (2005) 11 SCC 304 [3] (2009) 3 SCC 475 [4] 1995 Supp (1) SCC 18 [5] (1994) 2 SCC 521 [6] (1996) 4 SCC 416 [7] (1997) 6 SCC 139 [8] ? -----------------------"], "relevant_candidates": ["0000553744", "0000554725", "0001050827", "0001490925", "0001839402", "0001857940", "0001993685"]} {"id": "0146351380", "text": ["Reportable IN THE SUPREME COURT OF INDIA CRIMINAL APPELLATE JURISDICTION CRIMINAL APPEAL NO. 223 OF 2008 Rattiram & Ors. .............Appellant Versus State of M. P. Through Inspector of Police .........Respondent WITH CRIMINAL APPEAL NO. 458 OF 2008 Satyanarayan & ors. ............Appellant Versus The State of Madhya Pradesh Through Incharge, Police Station Cantt. .........Respondent J U D G M E N T ", ", J. ", "Perceiving divergent and contradictory views as regards the effect and impact of not committing an accused in terms of Section 193 of the Code of Criminal Procedure (for short `the Code') in cases where charge-sheet is filed under Section 3(1)(x) of the Scheduled Castes and the Scheduled Tribes (Prevention of Atrocities) Act, 1989 (for brevity `the Act') and cognizance is directly taken by the Special Judge under the Act, a two-Judge Bench thought it apposite to refer the matter to a larger Bench and on the basis of the said reference, the matter has been placed before us. At this juncture, it is requisite to clarify that the real conflict or discord is manifest in and on one hand wherein it has been held that the conviction by is not sustainable if it has suo motu entertained and taken cognizance of the complaint directly without the case being committed to it and, therefore, there should be retrial or total setting aside of the conviction, as the case may be, and the other in State of M. P. v. Bhooraji & Ors.3 wherein, taking aid of Section 465 (1) of the Code , it has been opined that when a trial has been conducted by the court of competent jurisdiction and a conviction has been recorded on proper appreciation of evidence, the same cannot be erased or effaced merely on the ground that there had been no committal proceeding and cognizance was taken by inasmuch as the same does not give rise to failure of justice. ", "1 AIR 2004 SC 1890 2 (2004) 1 SCC 215 3 AIR 2001 SC 3372 ", "2. The necessitous facts required to be adumbrated for the purpose of answering the present reference are that the appellants were charge sheeted under Section 3 (1) (x) of the Act but eventually, charges were framed under Sections 147 , 148 and 302 read with Section 149 of the Indian Penal Code (for short, `the IPC '). The learned Trial Judge vide judgment dated 31.08.1996 in Sessions Trial No. 97 of 1995 convicted all the accused persons barring for the offences under Section 302 read with Section 149 and sentenced them to imprisonment for life with a fine of Rs. 1000/-, in default of payment of fine, to suffer further rigorous imprisonment for three months and sentenced to one month rigorous imprisonment under Section 147 of the . The accused was convicted for the offence under Sections 148 and 302 of the and was sentenced to undergo one month rigorous imprisonment on the first score and to further life imprisonment and pay a fine of Rupees 1000/-, in default of payment of fine, to suffer further R.I. for three months on the second count. ", "3. Being dissatisfied with the judgment of conviction and the order of sentence, the appellants along with others preferred Criminal Appeal No. 1568 of 1996 before at Jabalpur. Apart from raising various contentions on merits, it was pressed that the entire trial was vitiated as it had commenced and concluded without committal of the case to as provided under Section 193 of the Code. Heavy reliance was placed on (supra) and Vidyadharan (supra) but the Division Bench placed reliance on (supra) wherein (supra) was distinguished keeping in view the stage of the case and regard being had to the provision contained in Section 465 of the Code and treated the same to be a binding precedent in view of the special Bench decision of rendered in and repelled the contention accordingly. Thereafter, as the impugned judgment would reveal, the Bench proceeded to deal with the matter on merits and eventually sustained the conviction and affirmed the sentence as has been indicated hereinbefore. ", "4 AIR 2000 SC 740 5 2003 (1) MPJR 158 ", "4. We have heard Mr. , learned senior counsel and Mr. for the appellants in both the appeals and Ms. , learned counsel for the respondent- ", "State. ", "5. At the very outset, we shall advert to the jurisdiction or authority of to take cognizance of the offence under the Act regardless of the interdict stipulated in Section 193 of the Code. Section 193 of the Code reads as follows: ", "\"193. Cognizance of offence by Court of Session- Except as otherwise expressly provided by this Code or by any other law for the time being in force, no court of Session shall take cognizance of any offence as a court of original jurisdiction unless the case has been committed to it by a Magistrate under this code.\" ", "On a plain reading of the aforesaid provision, it is clear as noon day that can take cognizance of any offence as a court of original jurisdiction except as otherwise expressly provided by the Code or any other law for the time being in force. ", "6. The questions that emanate, as a natural corollary, for consideration are whether as constituted under the Act is ; and whether there is any special provision in the Act enabling the said court to take cognizance. ", "7. In (supra), a two-Judge Bench of this , after taking note of Section 6 of the Code and Section 14 of the Act, came to the conclusion that the intendment of the legislature is to treat under the Act to be even after specifying it as and it would continue to be essentially and not get denuded of its character or power as . The scanned the anatomy of the Act and analysed the postulates contained in Sections 4 and 5 of the Code and thereafter, referring to the decisions in A. R. ", " and another6 and in and another7, expressed thus: ", "\"16. Hence we have no doubt that under this Act is essentially and it can take cognizance of the offence when the case is committed to it by the Magistrate in accordance with the provisions of the Code . In other words, a complaint or a charge-sheet cannot straight away be laid down before under the Act. ", "6 (1984) 2 SCC 500 7 (1994) 3 SCC 440 ", "8. In Vidyadharan (supra), the Court delved into the said issue and eventually proceeded to state as follows: ", "\"23. Hence, we have no doubt that under this Act is essentially and it can take cognizance of the offence when the case is committed to it by the Magistrate in accordance with the provisions of the Code . In other words, a complaint or a charge-sheet cannot straight away be laid down before under the Act. We are reiterating the view taken by this Court in . [ : 2000 SCC (Cri) 488] in the above terms with which we are in respectful agreement. in the case at hand, undisputedly, has acted as one of original jurisdiction, and the requirements of Section 193 of the Code were not met.\" The aforesaid view was reiterated in (supra). In M. A. ", " and another8, another two-Judge Bench ruled that the Special Judge under the Act cannot entertain a complaint filed before it and issue process after taking cognizance without the case being committed to it for trial by the competent Magistrate. It is apt to mention here that similar view has been spelt out in Bhooraji (supra). ", "9. After careful perusal of the aforesaid decisions, we have no scintilla of doubt that the view expressed which has a base of 8 (2004) 4 SCC 231 commonality is absolutely correct and there is no necessity to dwell upon the same more so when there is no cavil or conflict in this regard and there has been no reference on the said score. ", "Additionally, no doubt has been expressed relating to the exposition of the said view, and irrefragably correctly so. ", "10. The demonstrable facet of the discord is that if cognizance is directly taken by the Special Judge under the Act and an accused without assailing the same at the inception allows the trial to continue and invites a judgment of conviction, would he be permitted in law to question the same and seek quashment of the conviction on the bedrock that the trial Judge had no jurisdiction or authority to take cognizance without the case being committed to it and thereby violated the mandate enshrined under Section 193 of the Code. ", "11. To make the maze clear, it is profitable to note that in Gangula Ashok (supra), the appellants had called in question the legal substantiality of the order passed by the Single Judge of who, after expressing the view that the Special Judge had no jurisdiction to take cognizance of the offence under the Act without the case being committed to it, set aside the proceedings of and further directed the charge-sheet and the connected papers to be returned to the police officer concerned who, in turn, was required to present the same before the Judicial Magistrate of Ist Class for the purpose of committal to . That apart, the Single Judge further directed that on such committal, shall frame appropriate charges in the light of the observation made in the order. ", "12. The two-judge Bench accepted the view as far as it pertained to setting aside of the impugned order but did not approve the direction issued for the steps to be taken by the Special Judge for framing of charges as it was of the view that no direction could have been issued to as it was open to the appellants therein to raise all their contentions at the stage of framing of charge if they wished to advance a plea for discharge. Thus, it is evident that the accused-appellants had challenged the order of framing of charge and sought quashing of the same before . They did not wait for the trial to commence and the judgment of conviction to visit them. ", "10 ", "13. After the dictum in Gangula Ashok (supra), of Madhya Pradesh was dealing with an appeal, Bhooraji (supra), wherein the appellants were convicted under Sections 148 , 323 , 302 / 149 and sentenced to various punishments including imprisonment for life. It is worth noting that they were tried by the Special Judge under the Act as charge-sheet was filed under Section 3 (2) of the Act along with other offences of the IPC . When the matter came up before of , the learned Judges commenced the judgment with the prelude that the case had sluggished for more than nine years and the end was not in sight as direction for retrial seemed inevitable because of the decision rendered by this in Gangula Ashok (supra). ", "14. Be it noted, cognizance was taken directly by the Special Judge in the said case also. The anguish and the helplessness expressed by was taken note of when the State of Madhya Pradesh approached this Court. This Court laid emphasis on the fact that it was a case where the accused neither raised any objection when they were heard at the time of framing of the charge nor did they raise such a plea at any stage either before or after the evidence was recorded by the trial Court but, a significant one, proponed such a contention only after the conviction was recorded and that too after the decision in Gangula Ashok (supra) was rendered. ", "15. As is perceptible, the Bench posed the question whether necessarily should have quashed the trial proceedings to be repeated only on account of the declaration of the legal position made by this Court concerning the procedural aspect about the cases involving the offences under the Act. The Bench referred to the provisions contained in Sections 462 and 465 of the Code and adverted to the concept of \"a failure of justice\" and held thus: ", "\"15. A reading of the section makes it clear that the error, omission or irregularity in the proceedings held before or during the trial or in any enquiry were reckoned by the legislature as possible occurrences in criminal courts. Yet the legislature disfavoured axing down the proceedings or to direct repetition of the whole proceedings afresh. Hence, the legislature imposed a prohibition that unless such error, omission or irregularity has occasioned \"a failure of justice\" the superior court shall not quash the proceedings merely on the ground of such error, omission or irregularity. ", " ", "xxx xxx xxx xxx xxx ", "17. It is an uphill task for the accused in this case to show that failure of justice had in fact occasioned merely because the specified took cognizance of the offences without the case being committed to it. The normal and correct procedure, of course, is that the case should have been committed to because that court being essentially can take cognizance of any offence only then. But if a specified , on the basis of the legal position then felt to be correct on account of a decision adopted by , had chosen to take cognizance without a committal order, what is the disadvantage of the accused in following the said course? ", " ", "18. It is apposite to remember that during the period prior to the Code of Criminal Procedure 1973, the committal court, in police charge- ", "sheeted cases, could examine material witnesses, and such records also had to be sent over to along with the committal order. But after 1973, the committal court, in police charge-sheeted cases, cannot examine any witness at all. The Magistrate in such cases has only to commit the cases involving offences exclusively triable by . Perhaps it would have been possible for an accused to raise a contention before 1973 that skipping committal proceedings had deprived him of the opportunity to cross-examine witnesses in the committal court and that had caused prejudice to his defence. But even that is not available to an accused after 1973 in cases charge-sheeted by the police. We repeatedly asked the learned counsel for the accused to tell us what advantage the accused would secure if the case is sent back to merely for the purpose of retransmission of the records to through a committal order. We did not get any satisfactory answer to the above query put to the counsel.\" ", "16. After so stating, the Court proceeded to deal with the stance whether the Special Judge as a Court of Session would remain incompetent to try the case until the case is committed and, after critical ratiocination, declined to accept the said stand and opined that the expression \"a Court of competent jurisdiction\" as envisaged in Section 465 of the Code is to denote a validly constituted court conferred with the jurisdiction to try the offence or offences and such a court could not get denuded of its competence to try the case on account of any procedural lapse and the competence would remain unaffected by the non- ", "compliance with the procedural requirement. The Bench further proceeded to lay down that the inability to take cognizance of an offence without a committal order does not mean that a duly constituted court becomes an incompetent court for all purposes. ", "It was also ruled that had an objection been raised at the earlier stage, the Special Judge could have sent the record to the Magistrate for adopting committal proceeding or return the police report to the Public Prosecutor or the police for presentation before the Magistrate. In essentiality, it has been laid down that the bar against taking cognizance of certain offences or by certain courts cannot govern the question whether the concerned is a \" of competent jurisdiction\" and further the condition precedent for taking cognizance is not the standard to determine whether the concerned is \"a of competent jurisdiction\". In the ultimate eventuate, (supra) ruled that when the trial had been conducted by a of competent jurisdiction, the same cannot be annulled by such a lapse and, accordingly, remitted the matter to the High for disposal of the appeal afresh on the basis of evidence already on record. It needs no special emphasis to highlight that in (supra), the controversy had emerged on the similar set of facts and the legal issues had emanated on the common platform and were dealt with. Therefore, unquestionably, it was a precedent operating in the field. ", "17. It is seemly to note that the decision in Bhooraji (supra) was possibly not brought to the notice of their Lordships who have decided the cases in Moly (supra) and Vidyadharan (supra). In Moly (supra), later two-Judge Bench set aside the judgment of conviction and remitted the matter as cognizance was directly taken by . In Vidyadharan (supra), the Bench held thus:- ", "\"24. The inevitable conclusion is that the learned Sessions Judge, as the undisputed factual position goes to show, could not have convicted the appellant for the offence relatable to Section 3(1)(xi) of the Act in the background of the legal position noted supra. That is, accordingly, set aside. However, for the offence under Sections 354 and 448 , custodial sentence for the period already undergone, which as the records reveal is about three months, would meet the ends of justice considering the background facts and the special features of the case.\" ", "As is perceivable, in one case, the matter was remitted and in the other, the conviction under Section 3 (1)(xi) was set aside and no retrial was directed. ", "18. At this stage, we may proceed to x-ray the ratio of M. A. ", " (supra). In the said case, the challenge was to the order passed by under Section 482 of the Code wherein the learned Judge had quashed the order of the Special Judge taking cognizance of the offence under Section 3 (1)(x) of the Act. The two-Judge Bench referred to the authorities in Gangula Ashok (supra) and (supra) and gave the stamp of approval to the order passed by and eventually, while dismissing the appeal, observed as follows:- ", "\"However, it will be open to the appellant, if so advised, to file a complaint before a competent Magistrate who shall consider the complaint on its merit and then proceed in accordance with law. The learned as well as have made certain observations touching on the merit of the controversy. We make it clear that in case a complaint is filed by the appellant before a competent Magistrate, he shall proceed to consider the matter in accordance with law uninfluenced by any observation made either by the learned Special Judge or by . Nothing said in this judgment also shall be construed as expression of opinion on the merit of the case.\" ", " ", "19. It is apposite to note that in the said case, the assail was different and the Bench was not considering the effect of non- ", "committal under Section 193 of the Code after conviction was recorded. Though it referred to the authority in Vidyadharan (supra), yet that was to a limited extent. Hence, the said pronouncement cannot be regarded or treated to be one in line with Vidyadharan (supra) and is, therefore, kept out of the purview of conflict of opinion that has emerged in the two streams of authorities. ", "17 ", "20. Before we advert whether Bhooraji (supra) was correctly decided or Moly (supra) and Vidyadharan (supra) laid down the law appositely, it is appropriate to dwell upon whether Bhooraji (supra) was a binding precedent and, what would be the consequent effect of the later decisions which have been rendered without noticing it. ", "21. (dead) by L. Rs. And Others9, , speaking through , CJ, has held thus:- ", "\"We are of opinion that a pronouncement of law by a Division Bench of this Court is binding on a Division Bench of the same or a smaller number of Judges, and in order that such decision be binding, it is not necessary that it should be a decision rendered by or a Constitution Bench of the Court\" ", " ", "22. , of the High Court had come to the conclusion that the decision in .11 was not a binding precedent in view of the later decisions of the co-equal 9 ( 1989) 2 SCC 754 10 AIR 1995 SC 1480 11 AIR 1977 SC 308 Bench of this Court in and . It is worth noting that of the High Court proceeded that the decision in Ratna Prabha (supra) was no longer good law and binding on it. The matter was referred to which overruled the decision passed by . When the matter travelled to this Court, it observed thus:- ", "\" of in 1989 MPLJ 20 was clearly in error in taking the view that the decision of this Court in Ratna Prabha (AIR 1977 SC 308) (supra) was not binding on it. In doing so, of did something which even a later co- equal Bench of this Court did not and could not do.\" ", " ", "23. , a subsequent Constitution Bench reiterated the view that had already been stated in (supra). ", "24. Thus viewed, the decision in Bhooraji (supra) was a binding precedent, and when in ignorance of it subsequent decisions have been rendered, the concept of per incuriam would come into play. In this context, it is useful to refer to a passage from A. R. ", "12 AIR 1980 SC 541 13 AIR 1985 SC 339 14 (2003) SCC (L & S) 827 Antulay (supra), wherein, , J (as his Lordship then was), while dealing with the concept of per incuriam, had observed thus:- ", "\"\"Per incuriam\" are those decisions given in ignorance or forgetfulness of some inconsistent statutory provision or of some authority binding on the court concerned, so that in such cases some part of the decision or some step in the reasoning on which it is based, is found, on that account to be demonstrably wrong.\" ", " ", "Again, in the said decision, at a later stage, the Court observed:- ", "\"It is a settled rule that if a decision has been given per incuriam the court can ignore it.\" ", "25. Court, Chandigarh & Ors.15, another Constitution Bench, while dealing with the issue of per incuriam, opined as under:- ", "\"The Latin expression per incuriam means through inadvertence. A decision can be said generally to be given per incuriam when this has acted in ignorance of a previous decision of its own or when a High has acted in ignorance of a decision of this .\" ", "26. In State of U. P. And Another v. And Another16, a two-Judge Bench adverted in 15 (1990) 3 SCC 682 16 (1991) 4 SCC 139 detail to the aspect of per incuriam and proceeded to highlight as follows:- ", "\"`Incuria' literally means `carelessness'. In practice per incuriam appears to mean per ignoratium. English courts have developed this principle in relaxation of the rule of stare decisis. The `quotable in law' is avoided and ignored if it is rendered, `in ignoratium of a statute or other binding authority'. (Young v. ). Same has been accepted, approved and adopted by this Court while interpreting Article 141 of the Constitution which embodies the doctrine of precedents as a matter of law.\" ", " ", "27. Recently, in . 18, while addressing the issue of per incuriam, a two-Judge Bench, speaking through one of us (, J.), after referring to the dictum in (supra) and certain passages from Halsbury's Laws of England and (supra), has stated thus:- ", "\"149. The analysis of English and Indian Law clearly leads to the irresistible conclusion that not only the judgment of a larger strength is binding on a judgment of smaller strength but the judgment of a co-equal strength is also binding on a Bench of Judges of co-equal strength. In the instant case, judgments 17 (1944) 1 KB 718 : (1944) 2 ALL ER 293 18 AIR 2011 SC 312 : ( 2011) 1 SCC 694 mentioned in paragraphs 135 and 136 are by two or three judges of this Court. These judgments have clearly ignored a judgment of this Court in 's case (supra) which has comprehensively dealt with all the facets of anticipatory bail enumerated under Section 438 of Code of Criminal Procedure Consequently, judgments mentioned in paragraphs 135 and 136 of this judgment are per incuriam. ", " ", "150. In case there is no judgment of a Constitution Bench or larger Bench of binding nature and if the court doubts the correctness of the judgments by two or three judges, then the proper course would be to request Hon'ble the Chief Justice to refer the matter to a larger Bench of appropriate strength.\" ", " ", "28. The sequitur of the above discussion is that the decisions rendered in Moly (supra) and Vidyadharan (supra) are certainly per incuriam. ", "29. Presently, we shall proceed to address which view should be accepted as just and flawless. The centripodal issue, as we understand, is whether non-compliance of the interdict as envisaged and engrafted under Section 193 of the Code nullifies the final verdict after the trial and warrants its total extinction resulting in retrial, or it is incumbent on the part of the convict to exposit and satisfy that such guillotining of the interdict has occasioned in `failure of justice' or culminated in causation of prejudice to him for the purpose of declaring that the trial was vitiated. ", "30. In (supra), the Bench has referred to Sections 462 and 465 of the Code which occur in Chapter 35 of the Code . ", "Section 465 reads as follows:- ", "\"465. Finding or sentence when reversible by reason of error, omission or irregularity. ", "- (1) Subject to the provisions hereinbefore contained, no finding, sentence or order passed by a Court of competent jurisdiction shall be reversed or altered by a Court of appeal, confirmation or revision on account of any error, omission or irregularity in the complaint, summons, warrant, proclamation, order, judgment or other proceedings before or during trial or in any inquiry or other proceedings under this Code, or any error, or irregularity in any sanction for the prosecution unless in the opinion of that court, a failure of justice has in fact been occasioned thereby. ", "(2) In determining whether any error, omission or irregularity in any proceeding under this Code, or any error, or irregularity in any sanction for the prosecution has occasioned a failure of justice, the shall have regard to the fact whether the objection could and should have been raised at an earlier stage in the proceedings.\" ", "31. On a studied scrutiny of the anatomy of the said provision, it is luculent that the emphasis has been laid on a `court of competent jurisdiction' and `error, omission or irregularity in the complaint, summons, warrant, proclamation, order, judgment or other proceedings before or during trial' and `a failure of justice has in fact been occasioned thereby'. The legislative intendment inhered in the language employed is graphically clear that lancination or invalidation of a verdict after trial is not to be taken recourse to solely because there is an error, omission or irregularity in the proceeding. The term `a failure of justice' has been treated as the sine qua non for setting aside the conviction. ", "32. The submission of Mr. and Mr. , learned counsel for the appellants, is that it is not a mere irregularity but a substantial illegality. They have placed heavy reliance on paragraph 11 of Moly (supra) wherein the Bench has used the expression `that Section 193 imposes an interdict on all courts of Session against taking cognizance of an offence as a Court of original jurisdiction' and have also drawn inspiration from paragraph 17 of the said decision which uses the words `lack of jurisdiction'. The question posed by us fundamentally relates to the non-compliance of such interdict. The crux of the matter is whether it is such a substantial interdict which impinges upon the fate of the trial beyond any redemption or, for that matter it is such an omission or it is such an act that defeats the basic conception of fair trial. Fundamentally, a fair and impartial trial has a sacrosanct purpose. It has a demonstrable object that the accused should not be prejudiced. ", "A fair trial is required to be conducted in such a manner which would totally ostracise injustice, prejudice, dishonesty and favouritism. ", "33. 19, it has been laid down that `fair trial' includes fair and proper opportunities allowed by law to the accused to prove innocence and, therefore, adducing evidence in support of the defence is a valuable right and denial of that right means denial of fair trial. ", "It is essential that rules of procedure designed to ensure justice should be scrupulously followed and the courts should be zealous in seeing that there is no breach of them. ", "34. In this regard, we may fruitfully reproduce the observations from )20 wherein it has been so stated: - ", "\"In the Indian Criminal jurisprudence, the accused is placed on a somewhat advantageous position than under different jurisprudence of some of the countries in the world. The criminal justice administration system in India places 19 (2007) 2 SCC 258 20 (2010) 6 SCC 1 human rights and dignity for human life at a much higher pedestal. In our jurisprudence an accused is presumed to be innocent till proved guilty, the alleged accused is entitled to fairness and true investigation and fair trial and the prosecution is expected to play balanced role in the trial of a crime. The investigation should be judicious, fair, transparent and expeditious to ensure compliance to the basic rule of law. These are the fundamental canons of our criminal jurisprudence and they are quite in conformity with the constitutional mandate contained in Articles 20 and 21 of the Constitution of India.\" ", "[Underlining is ours] ", "35. It would not be an exaggeration if it is stated that a `fair trial' is the heart of criminal jurisprudence and, in a way, an important facet of a democratic polity that is governed by Rule of Law. Denial of `fair trial' is crucifixion of human rights. It is ingrained in the concept of due process of law. While emphasising the principle of `fair trial' and the practice of the same in the course of trial, it is obligatory on the part of the Courts to see whether in an individual case or category of cases, because of non-compliance of a certain provision, reversion of judgment of conviction is inevitable or it is dependent on arriving at an indubitable conclusion that substantial injustice has in fact occurred. The seminal issue is whether protection given to the accused under the law has been jeopardised as a consequence of which there has been failure of justice or causation of any prejudice. In this regard, it is profitable to refer to the decision in 21 wherein a three-Judge Bench has opined thus:- ", "\"This court in ` v. The state of Madhya Pradesh22 elaborately discussed the question of the applicability of Section 537 and came to the conclusion that in judging a question of prejudice, as a guilt, courts must act with a broad vision and look to the substance and not to technicalities, and their main concern should be to see whether the accused had a fair trial, whether he knew what he was being tried for, whether the main facts sought to be established against him were explained to him fairly and clearly and whether he was given a full and fair chance to defend himself. ", " ", "[Emphasis added] ", "36. Having dealt with regard to the concept of `fair trial' and its significant facets, it is apt to state that once prejudice is caused to the accused during trial, it occasions in `failure of justice'. ", "`Failure of justice' has its own connotation in various jurisprudences. As far as criminal jurisprudence is concerned, we may refer with profit to certain authorities. Be it noted that in Bhooraji (supra), the has referred to ", "21 AIR 1957 SC 623 22 1956 CriLJ 291 : AIR 1956 SC 116 wherein it has been observed as follows:- ", "\"23. We often hear about \"failure of justice\" and quite often the submission in a criminal court is accentuated with the said expression. Perhaps it is too pliable or facile an expression which could be fitted in any situation of a case. The expression `failure of justice' would appear, sometimes, as an etymological chameleon (the simile is borrowed from Lord in vs. ). The criminal court, particularly the superior court should make a close examination to ascertain whether there was really a failure of justice or whether it is only a camouflage.\" ", " ", "[Emphasis supplied] ", "37. In State by , had upheld an order of discharge passed by the trial court on the ground that the sanction granted to prosecute the accused was not in order. The two- ", "Judge Bench referred to Sections 462 and 465 of the Code and ultimately held thus:- ", "23 (2001) 2 SCC 577 : 2001 SCC (Cri) 358 24 (1977) 1 All ER 813 25 AIR 2004 SC 5117 \"13. In State of M.P. ", "v . ", "B hooraji and Ors. (2001) (7) SCC 679, the true essence of the expression \"failure of justice\" was highlighted. ", " Section 465 of the Code in fact deals with \"finding or sentences when reversible by reason of error, omission or irregularity\", in sanction. ", "14. In the instant case neither the Trial nor appears to have kept in view the requirements of sub-section (3) relating to question regarding \"failure of justice\". Merely because there is any omission, error or irregularity in the matter of according sanction that does not affect the validity of the proceeding unless the records the satisfaction that such error, omission or irregularity has resulted in failure of justice. ", "The same logic also applies to the appellate or revisional . The requirement of sub- ", "section (4) about raising the issue, at the earliest stage has not been also considered. ", "Unfortunately by a practically non-reasoned order, confirmed the order passed by the learned trial judge. The orders are, therefore, indefensible. We set aside the said orders. It would be appropriate to require to record findings in terms of Clause (b) of Sub-section (3) and Sub-section (4) of Section 19 .\" ", "38. We have referred to the said authority only for the purpose of a failure of justice and the discernible factum that it had concurred with the view taken in Bhooraji (supra). That apart, the matter was remitted to adjudge the issue whether there had been failure of justice, and it was so directed as the controversy pertained to the discharge of the accused. ", "39. , it was observed: - ", "\"10. A court of appeal or revision is debarred from reversing a finding (or even an order of conviction and sentence) on account of any error of irregularity in the sanction for the prosecution, unless failure of justice had been occasioned on account of such error or irregularity. For determining whether want of valid sanction had in fact occasioned failure of justice the aforesaid sub-section (2) enjoins on the court a duty to consider whether the accused had raised any objection on that score at the trial stage. Even if he had raised any such objection at the early stage it is hardly sufficient to conclude that there was failure of justice. It has to be determined on the facts of each case. But an accused who did not raise it at the trial stage cannot possibly sustain such a plea made for the first time in the appellate court.\" ", " ", "The concept of failure of justice was further elaborated as follows:- ", "\"11. In a case where the accused failed to raise the question of valid sanction the trial would normally proceed to its logical end by making a judicial scrutiny of the entire materials. If that case ends in conviction there is no question of failure of justice on the mere premise that no valid sanction was accorded for prosecuting the public servant because the very purpose of 26 (1999) 8 SCC 501 providing such a filtering check is to safeguard public servants from frivolous of mala fide or vindictive prosecution on the allegation that they have committed offence in the discharge of their official duties. But once the judicial filtering process is over on completion of the trial the purpose of providing for the initial sanction would bog down to a surplusage. This could be the reason for providing a bridle upon the appellate and revisional forums as envisaged in Section 465 of the Code of Criminal Procedure.\" ", "40. Adverting to the factum of irregular investigation and eventual conviction, in v. ", "State of Mysore27 opined thus: - ", "\"It has been emphasized in a number of decisions of this Court that to set aside a conviction it must be shown that there has been miscarriage of justice as a result of an irregular investigation.\" ", "41. After adverting to the concept of failure of justice, it is obligatory to dwell upon the aspect whether there is or can be any failure of justice if a Special Judge directly takes cognizance of an offence under the Act. Section 209 of the Code deals with the commitment of case to when an offence is triable exclusively by it. The said provision reads as follows: - ", "\"209. Commitment of case to Court of Session when offence is triable exclusively by it. - ", "27 AIR 1971 SC 508 When in a case instituted on a police report or otherwise, the accused appears or is brought before the Magistrate and it appears to the Magistrate that the offence is triable exclusively by , he shall - ", "(a) Commit, after complying with the provisions of section 207 or section 208 , as the case may be, the case to , and subject to the provisions of this Code relating to bail, remand the accused to custody until such commitment has been made; ", "(b) Subject to the provisions of this Code relating to bail, remand the accused to custody during, and until the conclusion of, the trial; ", "(c) Send to that Court the record of the case and the documents and articles, if any, which are to be produced in evidence; ", "(d) Notify the Public Prosecutor of the commitment of the case to .\" ", "42. Prior to coming into force of the present Code, Section 207 of the Code of Criminal Procedure, 1898 dealt with committal proceedings. By the Criminal Law Amendment Act , 1955, Section 207 of the Principal Act was substituted by Sections 207 and 207A . To appreciate the inherent aspects and the conceptual differences in the previous provisions and the present one, it is imperative to reproduce Sections 207 and 207A of the old Code. They read as under: ", "32 ", "\"207. In every inquiry before a magistrate where the case is triable exclusively by or , or, in the opinion of the magistrate, ought to be tried by such Court, the magistrate shall, - ", "(a) In any proceeding instituted on a police report, follow the procedure specified in section 207A ; and ", "(b) In any other proceeding, follow the procedure specified in the other provisions of this Chapter. ", " ", "207A. (1) When, in any proceeding instituted on a police report the magistrate receives the report forwarded under Section 173 , he shall, for the purpose of holding an inquiry under this section, fix a date which shall be a date of the receipt of the report, unless the magistrate, for reasons to be recorded, fixes any later date. ", "(2) If, at any time before such date, the officer conducting the prosecution applies to the magistrate to issue a process to compel the attendance of any witness or the production of any document or thing, the magistrate shall issue such process unless, for reasons to be recorded, he deems it unnecessary to do so. ", "(3) At the commencement of the inquiry, the magistrate shall, when the accused appears or is brought before him, satisfy himself that the documents referred to in section 173 have been furnished to the accused and if he finds that the accused has not been furnished with such documents or any of them, he shall cause the came to be so furnished. ", "33 ", "(4) The magistrate shall then proceed to take the evidence of such persons, if any as may be produced by the prosecution as witnesses to the actual commission of the offence alleged, and if the magistrate is of opinion that it is necessary in the interests of justice to take the evidence of any one or more of the other witnesses for the prosecution, he may take such evidence also. ", "(5) The accused shall be at liberty to cross- ", "examine the witnesses examined under sub- ", "section (4), and in such case, the prosecutor may re-examine them. ", "(6) When the evidence referred to in sub-section (4) has been taken and the magistrate has considered all the documents referred to in section 173 and has, if necessary, examined the accused for the purpose of enabling him to explain any circumstances appearing in the evidence against him and given the prosecution and the accused an opportunity of being heard, such magistrate shall, if he is of opinion that such evidence and documents disclose no grounds for committing the accused person for trial, record his reasons and discharge him unless it appears to the Magistrate that such person should be tried before himself or some other magistrate, in which case he shall proceed accordingly. ", "(7) When, upon such evidence being taken, such documents being considered, such examination (if any) being made and the prosecution and the accused being given an opportunity of being heard, the magistrate is of opinion that the accused should be committed for trial, he shall frame a charge under his hand, declaring with what offence the accused is charged. ", "34 ", "(8) As soon as such charge has been framed, it shall be read and explained to the accused and a copy thereof shall be given to him free of cost. ", "(9) The accused shall be required at once to give in, orally or in writing, a list of the persons, if any, whom he wishes to be summoned to give evidence on his trial: ", "Provided that the magistrate may, in his discretion, allow the accused to give in his list or any further list of witnesses at a subsequent time; and, where the accused is committed for trial before , nothing in this sub- ", "section shall be deemed to preclude the accused from giving, at any time before his trial, to the Clerk of the a further list of the persons whom he wishes to be summoned to give evidence on such trial. ", "(10) When the accused, on being required to give in a list under sub-section (9), has declined to do so, or when he has given in such list, the magistrate may make an order committing the accused for trial by or , as the case may be, and shall also record briefly the reasons for such commitment. ", "(11) When the accused has given in any list of witnesses under sub-section (9) and has been committed for trial, the magistrate shall summon the witnesses included in the list to appear before the Court to which the accused has been committed: ", "Provided that where the accused has been committed to , the magistrate may, in his discretion, leave such witnesses to be summoned by the Clerk of the State and such witnesses may be summoned accordingly: ", "35 ", "Provided also that if the magistrate thinks that any witness is included in the list for the purpose of vexation of delay, or of defeating the ends of justice, the magistrate may require the accused to satisfy him that there are reasonable grounds for believing that the evidence of such witness is material, and if he is not so satisfied, may refuse to summon the witness (recording his reasons for such refusal), or may before summoning him require such sum to be deposited as such magistrate thinks necessary to defray the expense of obtaining the attendance of the witness and all other proper expenses. ", "(12) Witnesses for the prosecution, whose attendance before or is necessary and who appear before the magistrate shall execute before him bonds binding themselves to be in attendance when called upon by or to give evidence. ", "(13) If any witness refuses to attend before or , or execute the bond above directed, the magistrate may detain him in custody until he executes such bond or until his attendance at or is required, when the magistrate shall send him in custody to or as the case may be. ", "(14) When the accused is committed for trial, the magistrate shall issue an order to such person as may be appointed by in this behalf, notifying the commitment, and stating the offence in the same form as the charge; and shall send the charge, the record of the inquiry and any weapon or other thing which is to be produced in evidence, to or where the commitment is made to , to the Clerk of the or other officer appointed in this behalf by . ", "36 ", "(15) When the commitment is made to and any part of the record is not in English, an English translation of such part shall be forwarded with the record. ", "(16) Until and during the trial, the magistrate shall, subject to the provisions of this Code regarding the taking of bail, commit the accused by warrant to custody.\" ", "43. On a bare perusal of the above quoted provisions, it is plain as day that an exhaustive procedure was enumerated prior to commitment of the case to . As is evincible, earlier if a case was instituted on a police report, the magistrate was required to hold enquiry, record satisfaction about various aspects, take evidence as regards the actual commission of the offence alleged and further was vested with the discretion to record evidence of one or more witnesses. Quite apart from the above, the accused was at liberty to cross-examine the witnesses and it was incumbent on the magistrate to consider the documents and, if necessary, examine the accused for the purpose of enabling him to explain any circumstances appearing in the evidence against him by the prosecution and afford the accused an opportunity of being heard and if there was no ground for committing the accused person for trial, record reasons and discharge him. Thus, the accused enjoyed a substantial right prior to commitment of the case. It was indeed a vital stage. But, in the committal proceedings in praesenti, the magistrate is only required to see whether the offence is exclusively triable by . Mr. , learned senior counsel, would submit that the use of the words \"it appears to the magistrate\" are of immense signification and the magistrate has the discretion to form an opinion about the case and not to accept the police report. To appreciate the said submission, it is apposite to refer to Section 207 of the 1973 Code which lays down for furnishing of certain documents to the accused free of cost. Section 209(a) clearly stipulates that providing of the documents as per Section 207 or Section 208 is the only condition precedent for commitment. It is noteworthy that after the words, namely, \"it appears to the Magistrate\", the words that follow are \"that the offence is triable exclusively by \". The limited jurisdiction conferred on the magistrate is only to verify the nature of the offence. It is also worth noting that thereafter, a mandate is cast that he \"shall commit\". Evidently, there is a sea of difference in the proceeding for commitment to under the old Code and under the existing Code. There is nothing in Section 209 of the Code to even remotely suggest that any of the protections as provided under the old Code has been telescoped to the existing one. ", "44. It is worth noting that under the Code of Criminal Procedure, 1898, a full-fledged Magisterial enquiry was postulated in the committal proceeding and the prosecution was then required to examine all the witnesses at this stage itself. In 1955, the by Act 26 of 1955 curtailed the said procedure and brought in Section 207A to the old Code. Later on, in its 41st Report, recommended thus:- ", "\"18.19. After a careful consideration we are of the unanimous opinion that committal proceedings are largely a waste of time and effort and do not contribute appreciably to the efficiency of the trial before . While they are obviously time- consuming, they do not serve any essential purpose. There can be no doubt or dispute as to the desirability of every trial, and more particularly of the trial for a grave offence, beginning as soon as practicable after the completion of investigation. Committal proceedings which only serve to delay this step, do not advance the cause of justice. The primary object of protecting the innocent accused from the ordeal of a sessions trial has not been achieved in practice; and the other main object of apprising the accused in sufficient detail of the case he has to meet at the trial could be achieved by other methods without going through a very partial and ineffective trial rehearsal before a Magistrate. We recommend that committal proceedings should be abolished.\" ", " ", "We have reproduced the same to accentuate the change that has taken place in the existing Code. True it is, the committal proceedings have not been totally abolished but in the present incarnation, it has really been metamorphosed and the role of the Magistrate has been absolutely constricted. ", "45. In our considered opinion, because of the restricted role assigned to the Magistrate at the stage of commitment under the new Code, the non-compliance of the same and raising of any objection in that regard after conviction attracts the applicability of the principle of `failure of justice' and the convict-appellant becomes obliged in law to satisfy the appellate court that he has been prejudiced and deprived of a fair trial or there has been miscarriage of justice. The concept of fair trial and the conception of miscarriage of justice are not in the realm of abstraction. They do not operate in a vacuum. They are to be concretely established on the bedrock of facts and not to be deduced from procedural lapse or an interdict like commitment as enshrined under Section 193 of the Code for taking cognizance under the Act. It should be a manifestation of reflectible and visible reality but not a routine matter which has roots in appearance sans any reality. Tested on the aforesaid premised reasons, it is well nigh impossible to conceive of any failure of justice or causation of prejudice or miscarriage of justice on such non-compliance. It would be totally inapposite and inappropriate to hold that such non-compliance vitiates the trial. ", "46. At this juncture, we would like to refer to two other concepts, namely, speedy trial and treatment of a victim in criminal jurisprudence based on the constitutional paradigm and principle. The entitlement of the accused to speedy trial has been repeatedly emphasized by this Court. It has been recognised as an inherent and implicit aspect in the spectrum of Article 21 of the Constitution. The whole purpose of speedy trial is intended to avoid oppression and prevent delay. It is a sacrosanct obligation of all concerned with the justice dispensation system to see that the administration of criminal justice becomes effective, vibrant and meaningful. The concept of speedy trial cannot be allowed to remain a mere formality (see , and ). ", "47. While delineating on the facets of speedy trial, it cannot be regarded as an exclusive right of the accused. The right of a victim has been given recognition in and . v. ", " and ors.31 wherein it has been observed thus: - ", "\"Any inordinate delay in conclusion of a criminal trial undoubtedly has highly deleterious effect on the society generally and particularly on the two sides of the case. But it will be a grave mistake to assume that delay in trial does not cause acute suffering and anguish to the victim of the offence. In many cases the victim may suffer even more than the accused. There is, therefore no reason to give all the benefits on account of the delay in trial to the accused and to completely deny all justice to the victim of the offence.\" ", " ", "[Emphasis supplied] ", "48. It is worthnoting that the Constitution Bench in and another32, though in a different context, had also observed that delay in the prosecution of a guilty person comes to his 28 29 AIR 2007 SC 56 30 AIR 1998 SC 3281 31 AIR 2009 SC 1535 32 AIR 2005 SC 2119 advantage as witnesses becomes reluctant to give evidence and the evidence gets lost. ", " ", "49. We have referred to the aforesaid authorities to illumine and elucidate that the delay in conclusion of trial has a direct nexus with the collective cry of the society and the anguish and agony of an accused. Decidedly, there has to be a fair trial and no miscarriage of justice and under no circumstances, prejudice should be caused to the accused but, a pregnant one, every procedural lapse or every interdict that has been acceded to and not objected at the appropriate stage would not get the trial dented or make it unfair. Treating it to be unfair would amount to an undesirable state of pink of perfection in procedure. An absolute apple pie order in carrying out the adjective law, would only be sound and fury signifying nothing. ", "50. In the case at hand, as is perceivable, no objection was raised at the time of framing of charge or any other relevant time but only propounded after conviction. Under these circumstances, the right of the collective as well as the right of the victim springs to the forefront and then it becomes obligatory on the part of the accused to satisfy the court that there has been failure of justice or prejudice has been caused to him. ", "Unless the same is established, setting aside of conviction as a natural corollary or direction for retrial as the third step of the syllogism solely on the said foundation would be an anathema to justice. Be it noted, one cannot afford to treat the victim as an alien or a total stranger to the criminal trial. The criminal jurisprudence, with the passage of time, has laid emphasis on victimology which fundamentally is a perception of a trial from the view point of the criminal as well as the victim. Both are viewed in the social context. The view of the victim is given due regard and respect in certain countries. In respect of certain offences in our existing criminal jurisprudence, the testimony of the victim is given paramount importance. Sometimes it is perceived that it is the duty of the court to see that the victim's right is protected. A direction for retrial is to put the clock back and it would be a travesty of justice to so direct if the trial really has not been unfair and there has been no miscarriage of justice or failure of justice. ", "51. We may state without any fear of contradiction that if the failure of justice is not bestowed its due signification in a case of the present nature, every procedural lapse or interdict would be given a privileged place on the pulpit. It would, with unnecessary interpretative dynamism, have the effect potentiality to cause a dent in the criminal justice delivery system and eventually, justice would become illusory like a mirage. It is to be borne in mind that the deliberately obliterated certain rights conferred on the accused at the committal stage under the new Code. The intendment of the in the plainest sense is that every stage is not to be treated as vital and it is to be interpreted to subserve the substantive objects of the criminal trial. ", "52. Judged from these spectrums and analysed on the aforesaid premises, we come to the irresistible conclusion that the objection relating to non-compliance of Section 193 of the Code, which eventually has resulted in directly entertaining and taking cognizance by the Special Judge under the Scheduled Castes and the Scheduled Tribes (Prevention of Atrocities) Act , 1989, does not vitiate the trial and on the said ground alone, the conviction cannot be set aside or there cannot be a direction of retrial and, therefore, the decision rendered in Bhooraji (supra) lays down the correct law inasmuch as there is no failure of justice or no prejudice is caused to the accused. The decisions rendered in Moly (supra) and Vidyadharan (supra) have not noted the decision in Bhooraji (supra), a binding precedent, and hence they are per incuriam and further, the law laid down therein, whereby the conviction is set aside or matter is remanded after setting aside the conviction for fresh trial, does not expound the correct proposition of law and, accordingly, they are hereby, to that extent, overruled. ", "53. The appeals be placed before the appropriate Bench for hearing on merits. ", "....................................J. ", "[Dalveer Bhandari] ....................................J. ", "[T. S. Thakur] ....................................J. ", "[Dipak Misra] New Delhi; ", "February 17, 2012."], "relevant_candidates": ["0000043757", "0000067608", "0000089097", "0000109277", "0000411958", "0000491047", "0000505842", "0000618763", "0000646586", "0000770735", "0001001969", "0001007347", "0001013766", "0001108032", "0001116451", "0001327587", "0001385093", "0001415882", "0001502681", "0001515299", "0001598265", "0001607181", "0001883009", "0001919674", "0009699283"]} {"id": "0147362898", "text": ["CASE NO.: Writ Petition (civil) 202 of 1955 PETITIONER: RAGHUBAR SARUP NAWAB JAMSHED ALI KHAN RESPONDENT: STATE OF U.P. DATE OF JUDGMENT: 18/12/1958 BENCH: S.R. DAS CJI & S.K. DAS & P.B. GAJENDRAGADKAR & K.N. WANCHOO & M. HIDAYATULLAH JUDGMENT: ", "JUDGMENT AIR 1959 SC 909 WANCHOO, J. : These petitions under Article 32 of the Constitution and appeals on certificates granted by question the action taken by the State of Uttar Pradesh under the U. P. Zamindari Abolition and Land Reforms Act, No. I of 1951, (hereinafter called the Abolition Act) and the Rampur Thekedari and Pattedari Abolition Act No. X of 1954, (hereinafter called the Thekedad Act). We propose to deal with them by one judgment as they raise common points and in the case of some petitioners lands covered by both the Acts are involved. ", "2. The former State of Rampur was an independent State under the paramountcy of the British Crown before 1947. When India became a on the passing of the Indian Independence Act of 1947, the State of Rampur acceded in August, 1947, to the of India by means of an instrument of accession. This was followed by a merger agreement between the Ruler of the Rampur State and the of India on May 15, 1949, by which the Ruler agreed to transfer the entire administration of the State to the as from July 1, 1949. The Governor General then passed an order on July 1, 1949, known as the Rampur (Administration) Order by which a Chief Commissioner was appointed to administer the area of the former Rampur State under . This was followed on November 29, 1949, by the States Merger (United Provinces) Order, 1949, promulgated by the Governor General by which the administration of the former State of Rampur was transferred to and Rampur thereafter became a district in the State of Uttar Pradesh. In 1951 the State of Uttar Pradesh passed the Abolition Act. It was, however, not applied to the district of Rampur initially; but power was reserved under S. 2 to apply the whole or any provisions of the Act to Rampur as defined in the Rampur (Administration) Order, 1949, subject to such exceptions or modifications, not affecting the substance, as the circumstances of the case may require. By virtue of this power, notification No. 3168/1-A-559/ 1951 was issued on June 30, 1954, applying the Abolition Act to Rampur. This was followed by another notification No. 3169/1-A559/1951 on July 1, 1954, declaring that all estates situate in Rampur vested in the State of Uttar Pradesh. These notifications are the target of attack in the petitions and appeals relating to jagirs, zamindaris and muafis in Rampur. ", "3. The system of land tenure in the former Rampur was this. In a portion of the known as Ileqz Jadid, which was ceded by to the former Rampur in 1857, there were intermediaries called Zamindars who were in all respects similar to the Zamindars in the of Uttar Pradesh. Secondly, some lands had been conferred by the Ruler of the on certain persons as jagirs or muafis. The holders of these estates did not pay any land revenue which was payable by the Zamindars; they only paid a local rate or abvab. Thirdly, the rest of the land in the consisted of Ehau villages, i. e. lands belonging to the in which there were no intermediaries between the and the tillers of the soil. In this class of lands, there were villages which were almost uninhabited and very little land in these villages was under cultivation. The Ruler of Rampur decided in March 1949 to lease out some of these villages to persons who were called Thekedars or Pattedars in order that these persons might settle tenants and invest money in the villages so that lands lying uncultivated might be brought under cultivation and the production of food grains might increase. These leases were to be in the first instance for a period of ten years with a right to the to extend the period by another ten years. The leases provided what the Thekedars were to do in order to bring lands in villages leased to them under cultivation and also provided what percentage of the profits was to be paid to the as revenue. The leases further provided for a review after three years, six years and ten years whether the conditions had been carried out and for increase of the 's share of the profit after each review. It was also provided that in case the conditions were not carried out, the leases would be terminated and the villages taken under direct management by the . Many petitioners and appellants before us are Thekedars or Pattedars to whom such leases were granted and the initial period of ten years has yet to run out. ", "4. The Abolition Act did not obviously apply to these leases. In 1954 the State of Uttar Pradesh decided to abolish this system of thekedari and pattedari prevalent in Rampur with a view to facilitating the introduction of land reforms therein. Consequently, the Thekedari Act was passed and received the assent of the President on April 18, 1954 and was to come into force from July 1, 1954. Section 2(6) of the Thekedari Act defines the word lease in terms to cover these leases Section 3 provides for determination of such leases and section 4 for the consequence of such determination. Sections 7 to 17 lay down the principles and procedure for payment of compensation to the lessees. The vires of this Act has also been challenged. ", "5. We shall first deal with the cases relating to jagirs, zamindaris and muafis. The contention in these cases was two-fold. In the first place, reliance was placed on the agreements entered into between the Ruler of Rampur and and it was urged that in view of these agreements it was not open to the State of Uttar Pradesh to abolish estates in Rampur. In the second place, it was contended that S. 2(1) of the Abolition Act was ultra vires as it amounted to excessive delegation of essential legislative functions to the executive, and in any case the notification of June 30, 1954, was bad inasmuch as it effected substantial changes in the definition of the word 'estate' in the said Act. ", "6. We are of opinion that there is no force in these contentions. The petitioners and the appellants in these cases cannot in the first place rely on the provisions of the agreement between the Ruler of Rampur and the Dominion of India and raise any dispute on the basis of this agreement in view of the bar of Art. 363 of the Constitution; (see. , 1955-2 SCR 164: ( (S) AIR 1955 SC 540). In any case even if one looks at clauses (iii) and (x) of the collateral letter which are the basis of this argument, it is found that there is nothing in this argument even on merits. Clause (iii) reads as follows:- ", "\"All contracts and agreements entered into by your Highness before the date on which the administration is made over to will be honoured except in so far as any of these contracts or agreements may either be repugnant to the provisions of a law made applicable to the State or inconsistent with any general policy of the successor Government.\" ", "Assuming that the jagirs, zamindaris and muafis with which we are concerned here are the result of some contracts or agreements entered into by Ruler of , clause (iii) makes it clear that these contracts and agreements would only be honoured except where they become inconsistent with any general policy of the successor Government. As soon therefore as the State of Uttar Pradesh which is the successor Government for present purposes decided to abolish the jagirs, zamindaris and muafis in pursuance of a general policy to abolish all estates in the whole of Uttar Pradesh, these contracts and agreements must fall and those deriving benefits from these contracts and agreements cannot put them forward against the general policy of the successor Government. ", "7. Clause (x) is in these terms--- ", "\"The present grants and allowances to the mothers, brothers, sisters, and other members of the family, list attached, will be continued during their life time and, will be charged on the revenue of the .\" ", " is a brother of the Ruler and he falls back on this clause. It is enough to say, as pointed out by , that this clause deals with cash allowances to the relations of the Ruler, which will be clear from the list attached and also from the fact that the clause provides that these grants and allowances would be charged on the revenue of the . 's name does not appear in the list attached, and, therefore, he cannot take advantage of this clause. The contention based on the agreement, therefore, fails. Our attention was also drawn to Articles 7 and 8 of the s Merger (Governors' Provinces) Order 1949, which also applied to the s Merger (United Provinces) Order 1949. Those Articles have no relevance so far as jagirs, zamindaris and muafis are concerned. They transfer the liability in respect of loans, guarantees and other financial obligations of arising out of the governance of the merged to the absorbing provinces and lay down that any contract made before the appointed day on behalf of the Dominion of India for the purposes connected with the governance of the merged shall have effect as if it had been made by or on behalf of the absorbing unless it is wholly or in part for central purposes. These provisions therefore have no earing on the questions canvassed before us. ", "8. The second contention relates to the vires of S. 2(1) of the Abolition Act and the notification, of June 30, 1954. We are of opinion that it is unnecessary to go into this question now, in view of the amendment made in the Abolition Act by U. P. Zamindari Abolition and Land Reforms (Amendment) Act, No. XIV of 1958. The main attack originally was that even if power of delegation under S. 2(1) of the Abolition Act was not excessive, the notification of June 30, 1954, by changing the definition of the word \"estate\" while applying the Abolition Act to Rampur made a change of substance therein. This argument now falls because U. P. Act No. XIV of 1958 has retrospectively amended the definition of the word \"estate\" in section 3(8) of the Abolition Act. Section 1(2) of the U. P. Act XIV of 1958 provides that the Act shall be deemed to have come into force from the 1st of July, 1952. Section 2 provides that the following shall be and shall be deemed to have always been substituted for clause (8) of S. 3 of the Abolition Act. The new definition of the word \"estate\" begins with the words \"estate means and shall be deemed to have always meant\". By this amendment the change made in the notification of June 30, 1954 in the definition of the word \"estate\" in the Abolition Act has now been made a legislative provision in force from July 1, 1952. It is not disputed that with this change in the definition of the word \"estate\" from July 1, 1952, all jagirs, zamindaris and muafis in Rampur would be covered by the word \"estate\" as now defined. So far as the power given to to extend the Abolition Act to other areas in the State of Uttar Pradesh to which it was not initially applied is concerned, it cannot be said that this power amounts to excessive delegation, for it is well settled that the legislature may leave it to the executive to apply the provisions of an Act to different geographical areas at different times depending on various considerations. This point, therefore, also fails in view of U. P. Act XIV of 1958. The contention that pending litigation is saved is not sound because the new law applies to all estates and no saving in respect of pending litigation can be implied; (see , v. Mt. , 63 Ind App 47 : (AIR 1936 PC 49). No other points were urged before us. All the petitions and appeals relating to jagirs, zamindaris and muafis must therefore be dismissed. But it is only proper that parties should bear their own costs as the amendment came in 1958. ", "9. This brings us to the petitions and appeals relating to thekedari and pattedari. In these cases also, reliance was placed on the agreements between the Ruler of Rampur and the Dominion of India. We have dealt with that already in the earlier part of this judgment and we reject the contention based on these agreements. ", "10. Then it was urged that the leases given to the thekedars and pattedars could not be determined under the Thekedari Act, because a perusal of the terms of the leases shows that in substance the person to whom the leases were granted was only a 'manager'. We find it difficult to appreciate this argument. We have already briefly summarised the terms of these leases. Those terms indubitably show that the persons to whom these leases were granted were not mere managers of these villages on behalf of the . In the first place, the instruments show that they were in terms called leases and the persons to whom they were granted were called lessees. These persons were not managers in the sense of being employees of the . They certainly had interest in the lands leased to them. As a matter of fact, three of the terms show that if certain conditions were not fulfilled the lease was to be determined and the management taken over directly by the . The lessees were to invest their own money, and had to pay what was called revenue and their interest was heritable. In the face of these terms the lessees can in no circumstances be called mere managers, and they cannot, therefore, say that the Thekedari Act which applies to lessees of these leases does not apply to them. The Thekedari Act in terms becomes applicable to leases of this kind under the definition in S. 2(6) and the lessees are directly hit by it. It is not disputed that had power to enact this law under Entry 18 of List II of the Seventh Schedule to the Constitution. Further, no argument was addressed before us against the adequacy of compensation provided in the Thekedari Act. In the circumstances, the Thekedari Act being within the powers of the legislature and complying with the provisions of Art. 31(2) is a valid piece of legislation to which no exception can be taken. No other point was urged before us in this connection. There is no force, therefore, in these petitions and appeals relating to thekedari and pattedari lands, and they must be dismissed. ", "11. We, therefore, dismiss all the petitions and appeals relating to jagirs, zamindaris and muafis; but in the circumstances pass no order as to costs in them. ", "12. We further dismiss all the petitions and appeals relating to thekedari and pattedari lands and order one set of costs to the State of Uttar Pradesh in them. ", "13. C. As. Nos. 530, 540, 569, 600, 601 and 617 of 1957 have abated and are hereby dismissed. ", "14. C. As. Nos. 547, 553, 555, 578, 595 and 598 of 1957 are dismissed for non prosecution."], "relevant_candidates": ["0000687712"]} {"id": "0157433067", "text": ["ORDER , J. ", "1. The judgmentdebtor in the E.P. No. 110/2005 in O.S. No. 210/1988, on the file of the learned , Alandur, is the Revision Petitioner before this . The respondent herein filed O.S. No. 19 8/1988 before the , Poonamallee for a declaration that the 'B' schedule property mentioned in the schedule is his absolute property and for directing the 1st defendant/Revision Petitioner to put the the decree holder/respondent in vacant possession of the suit property. By judgment and decree dated 31.10.1995, the trial court decreed the suit for title and dismissed the same for possession. The respondent/plaintiff herein alone filed an appeal in A.S. No. 385/1996 before this and of this by its elaborate judgment dated 29.3.2005 allowed the appeal and granted the decree for possession also. Against the judgment and decree dated 29.3.2005, the Revision Petitioner filed Special Leave Petition. But the same was also dismissed by the Hon'ble Supreme on 13.5.2005. The respondent/decree holder filed E.P. No. 110/2005 to execute the decree and after receiving the notice in the execution proceedings, the Revision Petitioner filed an Execution Application under Section 47 and with a prayer to declare that the decree dated 31.10.1995 is null and void and not executable against him. The execution court by order dated 14.3.2 006 in unnumbered SR No. 11420/2005 in E.P. No. 110/2005 rejected the same and challenging the order dated 14.3.2006, the above Revision Petition has been filed by the Revision Petitioner herein. ", "2. Heard the Learned Counsel for the Revision Petitioner and also the Learned Counsel for the respondent. I have also perused the documents filed in support of their submissions. ", "3. Learned counsel for the Revision Petitioner contended that the execution court has failed to exercise its jurisdiction to decide the issue in accordance with Section 47 of C.P.C., read with Rule 143 of the Civil Rules of Practice. He further submitted that the Revision Petitioner had no occasion to bring it to the notice of the court during the hearing of the suit and appeal about the fraud played by the decree holder against the courts and other authorities which came to light when he took steps to obey and to give effect to the decree in the suit. ", "4. Per contra, Learned Counsel for the respondent submitted that the executing court has rightly rejected the Section 47 application as the executing court cannot go behind the decree and reopen the matter afresh. ", "5. It is the case of the Revision Petitioner that he pursued the suit and appeal bonafidely without realising that the respondent herein played premeditated fraud by making and fabricating successive documents and obtained orders suppressing the public records with the calculated intention to cheat the real owner and legally interested persons. Therefore, according to him, the decree in O.S. No. 210/1988 is a nullity and unenforceable. It is the revision petitioner's further case that the decree is not executable against the petitioner in view of the inherent defect in the title of the property and also description of the property mentioned in the schedule in the decree. Learned counsel for the petitioner relied on the judgment ( ) to contend that objection under Section 47 about the executability of the decree can be allowed if it is found that the decree is a nullity. ", "6. In the above judgment, has elaborately dealt with the power of the executing court under Section 47 of C.P.C., and held as follows: ", "23. Under Section 47 of the Code, all questions arising between the parties to the suit in which the decree was passed or their representatives relating to the execution, discharge or satisfaction of decree have got to be determined by the court executing the decree and not by a separate suit. The powers of the court under Section 47 are quite different and much narrower than its powers of appeal, revision or review. A first appellate court is not only entitled but obliged under law to go into the questions of facts as well, like the trial court, apart from questions of law. Powers of the second appellate court under different statutes like Section 100 of the Code, as it stood before its amendment by Central Act 104 of 1976 with effect from 1.2 .1977, could be exercised only on questions of law. Powers under statutes which are akin to Section 100 of the Code, as amended and substituted by the aforesaid Central Act , have been further narrowed down as now in such an appeal only a substantial question of law can be considered. The powers of this under Article 136 of the Constitution of India, should not be exercised simply because substantial question of law arises in a case, but there is further requirement that such question must be of general public importance and it requires decision of this . Powers of revision under Section 115 of the Code cannot be exercised merely because the order suffers from legal infirmity or substantial question of law arises, but such an error must suffer with the vice of error of jurisdiction. Of course, the revisional powers exercisable under the Code of Criminal Procedure and likewise in similar statutes stand on entirely different footing and are much wider as there the court can go into the correctness, legality or propriety of the order and regularity of proceeding of the inferior court. It does not mean that in each and every case the revisional court is obliged to consider questions of facts as well like a first appellate court, but the court has discretion to consider the same in appropriate cases whenever it is found expedient and not in each and every case. Discretion, undoubtedly, means judicial discretion and not whim, caprice or fancy of a Judge. Powers of review cannot be invoked unless it is shown that there is error apparent on the face of the record in the order sought to be reviewed. ", "24. The exercise of powers under Section 47 of the Code is microscopic and lies in a very narrow inspection hole. Thus it is plain that executing court can allow objection under Section 47 of the Code to the executability of the decree if it is found that the same is void ab initio and nullity, apart from the ground that the decree is not capable of execution under law either because the same was passed in ignorance of such a provision of law or the law was promulgated making a decree inexecutable after its passing. In the case on hand, the decree was passed against of the College which was the defendant without seeking leave of the court to continue the suit against the upon whom the interest of the original defendant devolved and impleading it. Such an omission would not make the decree void ab initio so as to invoke application of Section 47 of the Code and entail dismissal of execution. The validity or otherwise of a decree may be challenged by filing a properly constituted suit or taking any other remedy available under law on the ground that the original defendant absented himself from the proceedings of the suit after appearance as he had no longer any interest in the subject of dispute or did not purposely take interest in the proceedings or colluded with the adversary or any other ground permissible under law. ", "7. From the above judgment, it is very clear that the powers of the court under Section 47 are much narrower than its powers of the appeal, revision or review. The executing court can allow objections under Section 47 of the Code to the executability of the decree if it is found that the same is void ab initio and a nullity, apart from the ground that the decree is not capable of execution under law either because the same was obtained passed in ignorance of such a provision of law or the law as promulgated making the decree in-executable after its passing. The validity or otherwise of a decree may be challenged by getting a properly instituted suit or taking any other remedy under law. The executing court cannot go behind t he decree except when the decree is a nullity or is without jurisdiction. ", "8. Learned counsel for the respondent relied on the judgment of ( .) to submit that should not enlarge the scope of the execution proceeding and treat it as a Full-blown suit. In the above judgment, held as follows: ", "7. In support of the appeals, Learned Counsel for the appellant submitted that a new dimension has been given by the Division Bench. Admittedly, Respondent 1 does not claim any right of ownership over the attached properties. No claims of the nature set forth by Respondent 1 can be examined in terms of Section 47 or Order 21 Rule 58 CPC. By the impugned judgment, has enlarged the scope of the execution proceedings and has treated it as a full-blown suit without even recording any reason as to how Respondent 1 has any adjudicable interest in the proceedings. The question of tenancy of tenancy cannot be decided by the executing court. ", "10. The executing court cannot go beyond the decree. It is settled position in law which flows from Section 38 CPC, except when the decree is a nullity or is without jurisdiction. The crucial expression in Section 47 is \"All questions arising between the parties to the suit\" \"or their representatives\". Order 21 Rule 54 deals with attachment of immovable property, while Rule 58 deals with adjudication of claims to, or objections to attachment of property. Case of Respondent 1is not covered by Section 47 or Order 21 Rule 54 or Rule 58. misconceived the nature of claim set up by Respondent 1. Learned Single Judge rightly noted that Respondent 1 was not having independent right to the properties. It found that the right claimed was as assignee under the judgment-debtor. The agreement, if any, in that regard was not produced before the and, therefore, the learned Single Judge drew adverse inference. Before , the stand of Respondent 1was that it was a tenant. Without indicating any reason as to how the reasoning of the learned Single Judge was wrong enlarged the scope of the controversy and directed the executing court to decide the question of tenancy, which is legally impermissible. ", "9. In the light of the well settled legal principles, let me examine the case on hand. ", "10. It is not in dispute that having suffered a decree, the Revision Petitioner did not file a regular appeal questioning the title of the respondent herein. It is only the respondent who filed an appeal before the court challenging the disallowed portion in the decree. The trial court rendered a finding that the revision petitioner herein is a trespasser and he is a person in possession without any authority. This finding was not at all challenged by the revision petitioner and the same reached its finality. In such circumstances it is not for the revision petitioner herein to contend that by the respondent creating and fabricating documents is thus cheating the true and real owner and legally interested persons. ", "11. The revision petitioner herein filed S. 47 application on the ground that the respondent herein did not have proper title and the documents he filed before the trial court to prove the title are bogus documents. Such kind of plea cannot be allowed to be raised for the first time by the petitioner in Section 47 application and if it is allowed to be raised the same will defeat the very decree itself and in such a case the executing court has to travel beyond the scope of the decree which is not permissible that too at the instance of a trespasser. ", "12. The court below has considered the entire facts and rightly came to the conclusion that all the documents relied on by the revision petitioner related to his defence in relation to the declaration relief sought for by the respondent herein which was already held against the petitioner. In such circumstances, I do not find any merit in the Revision Petition and the same is liable to be dismissed. Accordingly, the Civil Revision Petition is dismissed. No costs. C.M.P. No. 5 604/2006 is also dismissed."], "relevant_candidates": ["0001254898", "0001766988"]} {"id": "0172442656", "text": ["PETITIONER: & . Vs. RESPONDENT: UNION OF INDIA & ORS. DATE OF JUDGMENT: 25/04/2000 BENCH: , S.R.Babu, JUDGMENT: ", " J. : ", "Civil Appeal No. 5086 of 1994 This appeal is directed against the order made by , [hereinafter referred to as `the '] on November 5, 1993 in O.A. No. 286/92. Respondents Nos. 3 and 4 filed an application O.A. No. 286/92 before the . The pleadings raised in the application, briefly stated, are as under. ", "The respondents were directly recruited through as Assistant Executive Engineers (Electrical) Class I in , while respondents Nos. 3 to 5 before the were recruited as Assistant Engineers (Electrical) Class II and both the applicants and the other respondents were subsequently promoted on ad hoc basis and thereafter they were regularised as Executive Engineers (Electrical). The two respondents were aggrieved by the letter sent on February 6, 1992 which was accompanied by a seniority list of whereby the ad hoc services rendered by respondents 3 to 5 before the as Executive Engineers from May 25, 1977, February 21, 1982 and April 16, 1982 respectively being treated as regular services and counted for the purpose of seniority in that grade and proposed to re-fix that position in the final seniority list of Executive Engineers as on April 1, 1985 and thus the applicants before the being pushed down in the seniority list. ", "There are two channels of recruitment under the relevant recruitment rules and promotions to the post of Executive Engineer are to be made from two categories, namely, Assistant Executive Engineer Class I with five years regular service on seniority-cum-fitness basis (non-selection) in the 2/3rd quota and the other being Assistant Engineer Class II with eight years regular service on seniority-cum-merit basis (selection method) in the 1/3rd quota selection being made by with a member of the as Chairman. ", "The stand taken by the applicants before the is that while regular promotions to the grade of Executive Engineers from the Assistant Executive Engineers cadre was made regularly from 1976. However, the seniority in respect of Assistant Engineers Class II was not finalised till November 1987 in view of certain disputes inter se the promotees in the cadre. The thereafter selected from the category of Assistant Engineers Class II in a meeting held only in May 1988 when the selected the appellants for the vacancies belonging to their quota for the years 1977 to 1982. The appellants had thus worked for long period varying from 6 to 11 years in the post of Executive Engineer on ad hoc before the could meet for finalising regular promotion. The revision of the seniority list which was challenged before the , it was submitted, was only a corrective action though belated to render justice to the affected persons and is in compliance of the judgment of the Madras Bench of the dated October 12, 1990 in O.A. No. 113/89 directing disposal of the representation regarding the seniority of one of the appellants. It was further made clear in the said direction that it has to be decided after taking into account the decision of the Principal Bench of the in case in O.A. No. 978/87 and of this in ., 1990 (2) SCC 715. After noticing several decisions of this and of the , it was held that under the statutory recruitment rules promotions to the post of Executive Engineer were to be made from among the Assistant Engineers Class II with eight years regular service on seniority-cum-merit by selection method in the 1/3rd quota and admittedly the appellants were promoted on ad hoc basis as Executive Engineers on different dates mentioned earlier. The relevant appointments were purely temporary and on ad hoc basis and were for a limited duration and it was also made clear that services on ad hoc basis will not confer any claim in the matter of seniority, confirmation, etc. Thus it was noticed that the ad hoc promotions were made in administrative exigencies since seniority lists of Assistant Engineers could not be finalised in view of pending litigation and, therefore, the meeting for regular selection could not be arranged. Non- selection for a selection post can hardly be considered to be a minor procedural deficiency and, therefore, the concluded that selection was not by a competent and the ad hoc promotion was itself for a limited time and, therefore, does not fulfil the conditions mentioned in the decision in .., 1993 (3) SCC 371. The is of the view that ad hoc service to count for seniority must be rendered continuously till the date of regularisation for 15 years or more and, therefore, it held that the appellants could not take advantage of the ad hoc promotions made purely as a stop gap arrangement and it is only in special circumstances such ad hoc service could be counted for purpose of seniority as noticed in some of the decisions of this . Consequently, the application filed by the contesting respondents was allowed and it was declared that the appellants were not entitled to count their ad hoc service in the post of Executive Engineers (Electrical) for seniority, confirmation, promotion, etc. It is contended before us that regular promotions from Executive Engineers, which is a feeder cadre, to the grade of Superintending Engineer could not take place immediately and four vacancies of Superintending Engineers had arisen by the time the meeting of was held on October 17, 1984. Strong reliance was placed on the counter affidavit filed before the which is to the following effect :- \"The first two points after Point No. 7 of seniority list dated 10-4- 85 thus, go to the officers promoted from the rank of AEE(E) and SL No. 10 goes to the officer promoted from the rank of AE(E). A point was left blank in seniority list to accommodate an officer promoted from Group B. This was erroneously shown as Sl No. 9 instead of SL No. 10. This mistake has later on been rectified. The applicant cannot presume that in the selection process, he will find the top most position on the panel. The chaired by a Member of will draw a select panel according to statutory Recruitment Rules.\" ", "Appellant No. 1 claimed that he was assigned top most position by the held on May 13, 1988 but the provisional seniority list dated January 12, 1989 did not reflect his position and in those circumstances he sought permission to withdraw the pending application with liberty to file a fresh application. So far as appellant No. 2 is concerned, he filed an O.A. before the Madras Bench of the claiming seniority from the year 1982 when he was promoted on ad hoc basis to the grade of Executive Engineer (Electrical). The rejected the contention raised by the that he is deemed to be on regular basis only with effect from May 13, 1988 when the met. Since the seniority list dated January 12, 1989 was only provisional the directed appellant No. 2 to make another representation to the which the was directed to dispose of in accordance with law. Pursuant to this direction given by the Madras Bench of the it is stated that the seniority had to be re-fixed and, therefore, it is contended that inasmuch as they had rendered service for a long period at any rate in higher cadre and their promotions having been subsequently regularised ought to be treated as giving them seniority in the matter. ", "The stand taken by the contesting respondents is that under the relevant rules the should be headed by a member of which was not done in the case of the appellants at the time of their ad hoc appointment and appellant No. 1 was duly considered in 1978 and was not found suitable and for that reason his name did not figure in the selection list and there was no additional quota vacancy in the grade of Executive Engineer (Electrical) meant for group B cadre officers upto 1985. As a matter of fact, , who is admittedly senior to both the appellants, was only regularised on June 28, 1985 with effect from April 1, 1975 as he came under the purview of clause 4C of amended rules published on September 22, 1984. Since the appellants herein were not covered under clause 4C of amended rules 1984 and also additional quota was not available as such, they could not be regularised prior to 1985. The has taken note of the fact that the ad hoc promotions given to the appellants were not de hors the rules. It was contended that there were four vacancies against Assistant Engineers' quota but had informed the to fill two vacancies from direct recruitment and the accordingly selected and though and the first appellant were also eligible and vacancies were existing they were not regularly promoted by wrong interpretation of rules and separately reserving two vacancies for promotee cadre. Such provision is not existing in recruitment rules and the petitioners are the initial constituents in Assistant Engineer (Electrical) grade and are much above promotees in the Assistant Engineer (Electrical) seniority list. There was considerable delay in the introduction of initial constitution clause and the same was published only in 1984 after a gap of 9 years and came into force with effect from April 5, 1975. was thereafter convened by the on August 16, 1985 and appellants and officers, including and several other officers, were promoted on the dates indicating against their names. Appellant No. 1 and were not included as initial constituents since they neither completed eight years of service nor on ad hoc before April 5, 1975. Their promotions fall under maintenance clause 4A and 4B of amended rules 1984. They, however, formed the initial constituents in Assistant Engineer (Electrical) or Assistant Executive Engineer (Electrical) cadre separately. On that basis it was contended that the seniority list published is in order. ", " has also filed two appeals - one (Civil Appeal No. 3018 of 1997) arising out of judgment dated June 27, 1996 in O.A. No. 108/96 passed by the Madras Bench of and other (Civil Appeal No. 5081 of 1994) against judgment and order dated November 5, 1993 passed by the in O.A. No. 286/92. In O.A. No. 108/96 the Madras Bench of merely followed the judgment of the which is under appeal before us in Civil Appeal No. 3018 of 1997. ", "There is another dimension to the case by reason of the introduction of the Rules called \"The Posts & Telegraphs Civil Engineering (Electrical Gazetted Officers) Recruitment (Amendment) Rules, 1984\", which were given retrospective effect from April 5, 1975. It is explained that the reason for introduction of these Rules is that for recruitment to the various posts in the Electrical Branch of the Civil Wing of , the rules of recruitment were published on the April 5, 1975. Prior to commencement of the said Rules, there were officers who had joined directly as Assistant Executive Engineer (Electrical) through the Combined Engineering Services Examination held by . Those who had come on deputation from C.P.W.D. were also deemed to have been regularly appointed in pursuant to a decision of . Some of the officers were promoted to the higher grades on ad hoc basis. In order to ensure that these officers are not deprived of the service rendered by them before commencement of the rules, it was proposed to incorporate retrospectively a provision for initial constitution of these posts. Therefore, though the rules were amended by a notification issued on April 22, 1984 published in and it was given retrospective effect but the purpose of giving retrospective effect to the provision relating to the initial constitution of these posts would not prejudicially affect the interests of any person already in service. It is in this background, it is contended before us, that the cases of the appellants could not be considered to the post of Superintendent Engineers although they were functioning as the Executive Engineers without determining their position in the initially constituted cadre and that could be done with reference to the rules, as amended in 1984 which came into effect from April 5, 1975. Though there may have been some delay and complications arising thereto there is another factor which needs to be considered in these cases. The case of the 1st appellant was considered by in which Air Marshal was present on behalf of the and who presided over that meeting for selection of officers for officiating promotion to the grade of Executive Engineer (Electrical) and it was noticed that out of four vacancies, two vacancies are to be filled by promotion of direct recruit Assistant Engineer (Electrical) and the remaining two vacancies were kept reserved for the promotion of Assistant Engineer (Electrical). As no officer was available for consideration at present and the Committee accordingly considered the 4 eligible officers and assessed them. While , and were found to be `very good', the 1st appellant was assessed to be only `good'. This was recorded in the minutes of the meeting of held on June 2, 1978 in the office of the . Thereafter, in the minutes of the meeting of the meeting of held on May 13, 1988, the 1st appellant was found to be `very good' for the year 1977 as an Executive Engineer (Electrical) Group A. It is in these circumstances, it is to be considered whether the case of the 1st appellant could have been considered earlier to the date he was found fit to be promoted. The initially constituted cadre is of the date April 5, 1975 and on that date the 1st appellant had not been considered for promotion to the post of Executive Engineer and he was found fit to be promoted as Executive Engineer only with effect from 1977, i.e., much later to the promulgation of these rules. Reliance has been placed on the decision of this Court in [supra]. That is a case where the quota rule between the direct recruits and the promotees had broken down and the appointments were made from one source in excess of the quota, but were made after following the procedure prescribed by the rules for the appointment; therefore, it was held that the appointees should not be pushed down below the appointees from the other source inducted in the service at a later date. In that case the direct recruits were not available in adequate number for appointment and appropriate candidates in the subordinate rank capable of efficiently discharging the duties of Deputy Engineers were waiting in their queue. The development work of the pre-emptorily required experienced and efficient hands and in that situation the Government took a decision to fill up the vacancies by promotion in excess of the quota, but only after subjecting the officers to the test prescribed by the rules. Therefore, in those peculiar conditions certain directions had been given by this Court inasmuch as the rigours of the quota rule having been neutralised and the seniority being dependent on continuous officiation, the seniority so fixed would not be defeated by the ratio fixed by the rules. It is difficult to appreciate as to how the principle stated in that case could be extended to the case of 1st appellant in the present case as the quota rule had not broken down in any manner nor is there any material before the court to show that he has not been duly considered by before appointment to the higher grade. Again in the case of [supra] the same question arose. In that case it was noticed that when reckoning seniority the length of the service may be a relevant factor. If the ad hoc selection is followed by regular selection, then the benefit of ad hoc service is not admissible if ad hoc appointment is in violation of the rules. If the ad hoc appointment has been made as the stop gap arrangement and where there was a procedural irregularity in making appointments according to rules and that irregularity was subsequently rectified, the principle to be applied in that case was stated once again. There is difficulty in the way of the appellants to fight out their case for seniority should be reckoned by reason of the length of the service whether ad hoc or otherwise inasmuch as they had not been recruited regularly. As stated earlier, the appellants were regularly found fit for promotion only in the year 1977 and if that period is reckoned their cases could not be considered as found by the . The view expressed by this Court in these cases have been again considered in the decisions in ., 1998 (5) SCC 293; ., 1999 (1) SCC 280; ., 1997 (2) SCC 150; ., 1997 (6) SCC 406; , 1995 Supp. (1) SCC 16, but all these decisions do not point out that in case the promotions had been made ad hoc and they are subsequently regularised in the service in all the cases, ad hoc service should be reckoned for the purpose of seniority. It is only in those cases where initially they had been recruited even though they have been appointed ad hoc the recruitment was subject to the same process as it had been done in the case of regular appointment and that the same was not a stop gap arrangement. That is not the position in the present cases at all. Therefore, we are of the view that conclusions reached by the appear to us to be correct and call for no interference. However, we make it clear, as noticed earlier, that while amending the rules of recruitment in the 1984 all those who are already in service will be borne in mind in adjusting the seniority amongst the promotees inter se and suitable adjustments could be made and so far as the direct recruits are concerned, their cases will go by their quota rule and the view taken by the in this regard cannot be taken exception of. ", "Appeals stand dismissed accordingly."], "relevant_candidates": ["0000028618", "0000485116", "0000776307", "0001057686", "0001359551", "0001620184", "0057910187"]} {"id": "0181443842", "text": ["\u201cREPORTABLE\u201d IN THE SUPREME COURT OF INDIA CIVIL ORIGINAL/APPELLATE JURISDICTION TRANSFERRED CASE (C) NO. 150 OF 2006 \u2026Petitioner(s) versus and another \u2026Respondents WITH CIVIL APPEAL NO. 3850 OF 2006 CIVIL APPEAL NO. 3862 OF 2006 CIVIL APPEAL NO. 3881 OF 2006 CIVIL APPEAL NO. 3882 OF 2006 CIVIL APPEAL NO. 4051 OF 2006 CIVIL APPEAL NO. 4052 OF 2006 WRIT PETITION (C) NO.621 OF 2007 TRANSFERRED CASE (C) NO.116 OF 2006 TRANSFERRED CASE (C) NO.117 OF 2006 TRANSFERRED CASE (C) NO.118 OF 2006 WRIT PETITION (C) NO.697 OF 2007 J U D G M E N T ", ", J. ", "The Controversy: ", "1. All the above cases are being disposed of by this common judgment. The issue which arises for consideration before us, in the present bunch of cases, pertains to the constitutional validity of Act , 2005 (hereinafter referred to as, the Act). Simultaneously, the constitutional validity of the Constitution (Forty-second Amendment) Act, 1976 has been assailed, by asserting, that the same violates the basic structure of the Constitution of India (hereinafter referred to as, the Constitution), by impinging on the power of \u201cjudicial review\u201d vested in . In the event of this Court not acceding to the aforementioned prayers, a challenge in the alternative, has been raised to various provisions of the Act, which has led to the constitution of (hereinafter referred to as, the ). The , according to the learned counsel for the petitioners, is styled as a quasi- judicial appellate tribunal. It has been vested with the power of adjudicating appeals arising from orders passed by Appellate Tribunals (constituted under the Income Tax Act , the Customs Act , 1962, and the Central Excise Act , 1944). Hitherto before, the instant jurisdiction was vested with . The pointed issue canvassed in this behalf is, that which discharge judicial functions, cannot be substituted by an extra-judicial body. Additionally, it is maintained that the in the manner of its constitution undermines a process of independence and fairness, which are sine qua non of an adjudicatory authority. ", "The Historical Perspective: ", "The Income Tax Legislation, in India: ", "2(i). Law relating to income tax dates back to 1860, when legislation pertaining to levy of tax on income, was introduced in India for the first time. The original enactment was replaced by subsequent legislations, enacted in 1865, 1886, 1918 and 1922. The Indian Income Tax Act , 1922 (hereinafter referred to as, the 1922 Act) was brought about, as a result of the recommendations of . The 1922 Act can be described as a milestone in the evolution of direct tax laws in India. Detailed reference needs to be made to the provisions of the 1922 Act. ", "(ii) After the procedure provided for assessment of tax had run its course, and tax had been assessed, an executive-appellate remedy was provided for, before the Appellate Assistant Commissioner of Income Tax (under Section 30 of the 1922 Act). A further quasi-judicial appellate remedy, from decisions rendered by the first appellate authority, lay before an appellate tribunal (hereinafter referred to as ). Section 33A was inserted by the Indian Income Tax (Amendment) Act , 1941. It provided for a remedy by way of revision before a Commissioner of Income Tax. ", "(iii) The remedy before (provided under Section 5A of the 1922 Act, by Section 85 of the Indian Income Tax (Amendment) Act, 1939), was required to be exercised by a bench comprising of one Judicial Member and one Accountant Member. It was permissible for the President of or any other Member thereof, to dispose of appeals, sitting singly (subject to the condition, that the total income of the assessee, as computed by the assessing officer, did not exceed Rs.15,000/- ). It was also open to the President of to constitute larger benches of three Members (subject to the condition, that the larger bench would comprise of at least one Judicial Member and one Accountant Member). ", "(iv) Section 5A of the 1922 Act, laid down the conditions of eligibility for appointment as a Judicial Member - a person who had served on a civil judicial post for 10 years was eligible, additionally an Advocate who had been practicing before for a period of 10 years, was also eligible. Under the 1922 Act, a person who had practiced in accountancy as a Chartered Accountant (under the Chartered Accountants Act , 1949) for a period of 10 years, or was a Registered Accountant (or partly a Registered Accountant, and partly a Chartered Accountant) for a period of 10 years (under any law formerly enforced), was eligible for appointment as an Accountant Member. Only a Judicial Member could be appointed as the President of . ", "(v) Section 67 of the 1922 Act, barred suits in civil courts pertaining to income tax related issues. Additionally, any prosecution suit or other proceedings could not be filed, against an officer of the , for an act or omission, in furtherance of anything done in good faith or intended to be done under the 1922 Act. ", "(vi) The 1922 Act, did not provide for an appellate remedy, before the jurisdictional . The only involvement of the jurisdictional , was under Section 66 of the 1922 Act. Under Section 66 , either the assessee or the Commissioner of Income Tax, could move an application to , requiring it to refer a question of law (arising out of an assessment order) to the jurisdictional . In case of refusal to make such a reference, the aggrieved assessee or the Commissioner of Income Tax, could assail the refusal by , before the jurisdictional . A case referred to the under Section 66 , was to be heard by a bench of not less than two judges of the ( Section 66A of the 1922 Act \u2013 inserted by the Indian Income Tax (Amendment) Act , 1926). Section 66 of the 1922 Act, was amended by the Indian Income Tax (Amendment) Act , 1939, whereby the power to make a reference became determinable by the Commissioner of Income Tax (in place of ). ", "(vii) In exercise of the reference jurisdiction, a question of law, which had arisen in an appeal pending before , had to be determined by . After the jurisdictional had answered the reference, would dispose of the pending appeal in consonance with the legal position declared by . 3(i) The 1922 Act was repealed by the Income Tax Act , 1961 (hereinafter referred to as, the Income Tax Act ). As in the repealed enactment, so also under the Income Tax Act , an order passed by an assessing officer, was assailable through an executive-appellate remedy. The instant appellate remedy, was vested with the Deputy Commissioner (Appeals)/Commissioner (Appeals). The orders appealable before the Deputy Commissioner (Appeals) were distinctly mentioned (in Section 246 of the Income Tax Act). Likewise, the orders appealable before the Commissioner (Appeals) were expressly enumerated (in Section 246A of the Income Tax Act). ", "(ii) As against the order passed by the executive-appellate authority, a further appellate remedy was provided before a quasi-judicial appellate tribunal (hereinafter referred to as, , under Section 252 of the Income Tax Act). Section 255(6) of the Income Tax Act provides as under:- ", "\u201c6. shall, for the purpose of discharging its functions, have all the powers which are vested in the income-tax authorities referred to in section 131 , and any proceeding before shall be deemed to be a judicial proceeding within the meaning of sections 193 and 228 and for the purpose of section 196 of the Indian Penal Code , and shall be deemed to be a civil court for all the purposes of section 195 and Chapter XXXV of the Code of Criminal Procedure, 1898 .\u201d By a deeming fiction of law, therefore, was considered as a civil court , dealing with \u201cjudicial proceedings\u201d. ", "(iii) To be eligible for appointment as the President of the , the incumbent had to be a sitting or retired judge of , with not less than 7 years of service as a judge. Alternatively, could appoint a Senior Vice President or a Vice President of , as its President. It is, therefore apparent, that was to be comprised of a President, Senior Vice President(s), Vice President(s) and Members. ", "(iv) The benches of , under the Income Tax Act (was similar to the one under the 1922 Act), were to be comprised of at least one Judicial Member and one Accountant Member. The authority to constitute benches of was vested with the President. The composition of the benches under the Income Tax Act , was similar to that postulated under the 1922 Act. When authorized by , it was open to , to dispose of appeals sitting singly (subject to the condition, that the appeal pertained to a dispute, wherein the concerned assessee\u2019s total income was assessed as not exceeding Rs.5 lakhs). The President of , had the authority to constitute special benches, comprising of three or more Members (one of whom had to be a Judicial Member, and one, an Accountant Member). In case of difference of opinion, the matter was deemed to have been decided in terms of the opinion expressed by the majority. ", "(v) An assessee or the Commissioner, could move an application before , under Section 256 of the Income Tax Act, requiring it to make a reference to on a question of law (arising in an appeal pending before ). In case the prayer made in the application was declined by , the order (declining the prayer) was assailable before . ", "(vi) Section 257 of the Income Tax Act provided for a reference directly to . The instant reference could be made by , if it was of the opinion, that the question of law which had arisen before it, had been interpreted differently, by two or more jurisdictional . ", "(vii) Section 260A was inserted in the Income Tax Act by the Finance (No. ", "2) Act, 1998, with effect from 1.10.1998. Under Section 260A , an appellate remedy was provided for, to raise a challenge to orders passed by . The instant appellate remedy, would lie before the jurisdictional . In terms of the mandate contained in Section 260B of the Income Tax Act, an appeal before the was to be heard by a bench of not less than two judges. The opinion of the majority, would constitute the decision of the . Where there was no majority, on the point(s) of difference, the opinion of one or more judges of the , was to be sought. Thereupon, the majority opinion of the judges (including the judges who had originally heard the case) would constitute the decision of the . ", "(viii) A further appellate remedy was available as against a decision rendered by the jurisdictional . The instant appellate remedy was vested with under Section 261 of the Income Tax Act. ", "The Customs Legislation, in India: ", "4(i). The Act , 1962 (hereinafter referred to as, the Act ) was enacted to consolidate and amend the law relating to customs. The Act vested the power of assessment of customs duty, with the Deputy Collector of or the Collector of . An executive-appellate remedy was provided under Section 128 of the Act, before a Collector of (where the impugned order had been passed by an officer, lower in rank to the Collector of ), and before the Central of Excise and (constituted under the Central s of Revenue Act , 1963), where the impugned order had been passed by a Collector of . The had also been conferred with executive revisional powers (under Section 130 of the Act), to suo moto, or on an application of an aggrieved person, examine the record of any proceeding, pertaining to a decision or order under the provisions of the Act . Revisional powers, besides those expressly vested in the (under Section 130 of the Act), were also vested with the Central Government (under Section 131 of the Act). ", "(ii) By the Finance (No. 2) Act, 1980, Sections 128 to 131 of the original Act were substituted. The power to entertain the first executive-appellate remedy, was now vested with the Collector (Appeals), under Sections 128 and 128A of the Customs Act. On exhaustion of the above remedy, a further quasi-judicial appellate remedy was provided for, under Sections 129 and 129A before (hereinafter referred to as, ). was also the appellate authority, against orders passed by the . With introduction of Service Tax, under Chapter V of the Finance Act, 1994, was conferred the jurisdiction to hear appeals in cases pertaining to service tax disputes as well. is now known as \u2013 the . By Act 22 of 2003, the expression \u201cGold (Control)\u201d was substituted with \u201cService Tax\u201d in the definition of \u201d (w.e.f. 14.5.2003). ", "(iii) Section 129 of the Act delineated the constitution of the . It was to comprise of as many Judicial and Technical Members, as thought fit. The instant provision, also laid down the conditions of eligibility for appointment of Judicial/Technical Members. A Judicial Member could be chosen out of persons, who had held a civil judicial post for at least 10 years, or out of persons who had been in practice as an Advocate for at least 10 years, as also, from out of Members of (not below Grade-I), who had held such post for at least 3 years. A Technical Member could be appointed out of persons, who had been members of the Indian and (Group A), subject to the condition, that such persons had held the post of Collector of or (Level I), or equivalent or higher post, for at least 3 years. The Finance (No.2) Act , 1996 amended Section 129(3) of the Act, whereby it enabled to appoint a person to be the President of . could make such appointment, subject to the condition, that the person concerned had been a judge of , or was one of the Members of . Likewise, it was open to to appoint one or more Members of to be its Vice President(s). ", "(iv) Powers and functions of were to be exercised through benches constituted by its President, from amongst Members of (in terms of Section 129C of the Customs Act). Each bench was required to be comprised of at least one Judicial Member and one Technical Member. It was open to the President to constitute a special bench of not less than three Members (comprising of at least one Judicial and one Technical Member). The composition of the bench, was modified by an amendment which provided, that a special bench of was to consist of not less than two Members (instead of three). It was also open to the President and/or Members (as authorized by the President of ) to dispose of appeals, sitting singly, subject to the condition, that the value of goods confiscated, or the difference in duty involved, or duty involved, or the amount of fine or penalty involved, did not exceed Rs.10,000/- -- the limit was first revised to Rs.50,000/-, then to Rs.1 lakh, later to Rs.10 lakhs, and at present, the same is Rs.50 lakhs. A case involving a dispute where the determination of any question having a relation to the rate of duty of customs or to the value of goods for purposes of assessment is the sole or one of the points in issue, must however be heard by a bench comprising of a Judicial and a Technical Member [ Section 129C(4)(b) ]. In case of difference of opinion on any point(s), the opinion of the majority was to constitute the decision of . If Members were equally divided, the appeal was to be referred by the President, for hearing on such point(s), by one or more other Members of . Whereupon, the majority opinion was to be considered as the decision of . Sub-sections (7) and (8) of Section 129C provided as under:- ", "\u201c(7) shall, for the purposes of discharging its functions, have the same powers as are vested in a court under the Code of Civil Procedure, 1908 , when trying a suit in respect of the following matters, namely:- ", "discovery and inspection; ", "enforcing the attendance of any person and examining him on oath; compelling the production of books of account and other documents; and issuing commissions. ", "(8) Any proceeding before shall be deemed to be a judicial proceeding within the meaning of Sections 193 and 228 and for the purpose of Section 196 of the Indian Penal Code 945 of 1860) and shall be deemed to be for all the purposes of Section 195 and Chapter XXVI of the Code of Criminal Procedure, 1973 .\u201d It is apparent from the above provision, that by a fiction of law, proceedings before are treated as judicial proceedings. ", "(v) The Customs and Excise Revenues Appellate Tribunal Act , 1986 came into force with effect from 23.12.1986. Section 26 of the instant enactment, excluded the jurisdiction of courts except . Section 28 thereof provided as under:- ", "\u201c28. Proceedings before to be judicial proceedings \u2013 All proceedings before shall be deemed to be judicial proceedings within the meaning of Sections 193 , 219 and 228 of the Indian Penal Code .\u201d A perusal of the above amendment reveals, that by a fiction of law, was deemed to be discharging \u201cjudicial proceedings\u201d. Therefore, the position prevailing prior to the amendment, was maintained, so far as the instant aspect was concerned. ", "(vi) Just as in the case of the 1922 Act, which did not provide for an appellate remedy, but allowed a reference to be made to a jurisdictional , under Section 66 , likewise, Section 130 of the Act provided for a reference on a question of law, to the . A reference could be made, on an application by the Collector of or the person on whom customs duty has been levied, to . If refused to make a reference, the aggrieved party could assail the determination of , before the jurisdictional . Where a reference on a question of law was entertained, it had to be heard by a bench of not less than two judges of the . In case of difference of opinion on any point(s), the opinion expressed by the majority, was to be treated as the decision of the . Where the opinion was equally divided, on the point(s) of difference, the matter was to be heard by one or more other judges of the . Thereupon, the majority opinion of the judges (including the judges who had originally heard the case) would constitute the decision of the . A decision of the , would then be applied by , for the disposal of the appeal wherefrom the reference had arisen. ", "(vii) was also authorized to make a reference directly to (under Section 130A of the Customs Act). This could be done, in case was of the view, that there was a conflict of decisions of in respect of a question of law pending before it for decision. The decision of , would then be applied by , for the disposal of the appeal out of which the reference had arisen. ", "(viii) The Finance (No. 32) Act, 2003 introduced a new Section 130 . The remedy of a reference to the jurisdictional , was substituted by a remedy of an appeal to the . The amended Section 130 of the Customs Act provided, that an appeal would lie to the from every order passed by (on or after 1.7.2003), subject to the condition, that the was satisfied, that the case involved a substantial question of law. In such an eventuality, the would formulate the substantial question(s) of law. It was open to the in exercise of its instant appellate jurisdiction, also to determine any issue which had not been decided by , or had been wrongly decided by . The appeal preferred before the , could be heard by a bench of not less than two judges. ", "(ix) After amendment to Section 130 , Section 130E was also amended. The latter amended provision, provided for an appeal to , from a judgment of , delivered on an appeal filed under Section 130 , or on a reference made under Section 130 by (before 1.7.2003), or on a reference made under Section 130A . ", "(x) The Act omitted Sections 130 , 130A , 130B , 130C and 130D of the Customs Act. The instant enactment provided for an appeal from every order passed by to the , subject to the condition, that the arrived at the satisfaction, that the case involved a substantial question of law. On admission of an appeal, the would formulate the substantial question of law for hearing the appeal. Section 23 of the Act provided, that on and from the date, to be notified by , all matters and proceedings including appeals and references, pertaining to direct/indirect taxes, pending before , would stand transferred to the . Section 24 of the Act provides for an appeal from an order passed by the , directly to . ", "The Central Excise Legislation, in India: ", "5(i). The Central Excise and Salt Act , 1944 (hereinafter referred to as, the Excise Act ) was enacted to consolidate and amend, the law related to central duties on excise, and goods manufactured and produced in India, and to salt. Under the said enactment, the power to assess the duty, was vested with the Assistant Collectors of Central Excise, and Collectors of Central Excise. An executive-appellate remedy was provided for under Section 35 before the Commissioner (Appeals). ", "(ii) The was vested with revisional jurisdiction. Revisional jurisdiction was additionally vested with . In 1972, the was empowered under Section 35A of the Excise Act, to exercise the power of revision, from a decision/order/rule made/passed, under the Excise Act , subject to the condition, that no revision would lie under the instant provision, as against an appellate order passed under Section 35 of the Excise Act, by the Commissioner (Appeals). was vested with revisional jurisdiction against appellate orders passed by the Commissioner (Appeals) under Section 35 . In 1978, the revisional jurisdiction which hitherto before lay with the , was vested with the Collector of . ", "(iii) On the exhaustion of the first executive-appellate remedy, a further quasi-judicial appellate remedy was provided for, under Section 35B of the Excise Act, to . The remedy of appeal before , could be availed of (a) against a decision or order passed by the Collector of as an adjudicating authority, (b) against an order passed by the Collector (Appeals) under Section 35A of the Excise Act (as substituted by the Finance (No. 2) Act, 1980), (c) against an order passed by the or the Appellate Collector of under Section 35 (as it stood before 21.8.1980), and (d) against an order passed by the or the Collector of under Section 35A (as it stood before 21.8.1980). ", "(iv) was to be comprised of such number of Judicial/Technical Members as would think fit. Appointment of Judicial Members could only be made from amongst persons who had held a judicial office in India for at least 10 years, or who had been practicing as an Advocate for at least 10 years, or who had been a member of (having held a post in Grade I of the said service, or any equivalent or higher post) for at least 3 years. Only such persons could be appointed as Technical Members who had been, members of , Group A, and had held the post of or (or any equivalent or higher post) for at least 3 years. had the power to appoint a person, who was or had been a judge of , or who was one of the Members of , as the President of . The functions of were to be discharged through benches constituted by its President. also had the authority to appoint one or more Members of as Vice-President(s). Each bench was to consist of at least one Judicial Member and one Technical Member. In case of difference of opinion on any point(s), the opinion of the majority would constitute the decision of . If the Members of the bench were equally divided, the President was required to refer the disputed opinion for hearing, on the point(s) of difference, by one or more other Members of . The majority opinion after such reference, would be the decision of . It was also permissible for the President, and the Members (authorized by the President) of , to hear and dispose of appeals, sitting singly (subject to the condition, that the difference in duty or the duty involved, or the amount of fine or penalty involved, did not exceed Rs.10,000/- -- the limit was first revised to Rs.50,000/-, then to Rs.1 lakh, later to Rs.10 lakhs, and at present, the same is Rs.50 lakhs). Similar provision (as in respect of appeals to under Customs Act ) with regard to matters to be heard by a division bench, is enjoined in Section 35D(3)(a) of the Excise Act. ", "(v) The Customs and Excise Revenues Appellate Tribunals Act , 1986, came into force on 23.12.1986. Section 26 of the instant enactment excluded the jurisdiction of courts except . Section 14 , provided for jurisdiction, powers and authority of . Section 28 provided as under:- ", "\u201c28. Proceedings before to be judicial proceedings \u2013 All proceedings before shall be deemed to be judicial proceedings within the meaning of Sections 193 , 219 and 228 of the Indian Penal Code .\u201d A perusal of the above amendment reveals, that by a fiction of law, was deemed to be discharging \u201cjudicial proceedings\u201d. ", "(vi) Section 35G provided for a reference on any question of law, by , to . The aforesaid remedy could be availed of by filing an application before . Such an application could be filed by either the Collector of Central Excise, or the person on whom the excise duty was levied. A reference, on a question of law, made by , to , would be heard by a bench of not less than two judges. On \u2019s refusal to refer a question of law, the aggrieved party could assail the decision of (declining to make a reference), before . The jurisdictional , on the acceptance of a reference, would render its decision, on the question of law. In case of difference of opinion, the opinion expressed by the majority would constitute the decision of . If the opinion by the bench was equally divided, the point(s) of difference were to be heard by one or more other judges of , whereafter, the opinion expressed by the majority would be treated as the decision of . would thereupon, decide the pending appeal, in consonance with the decision rendered by . ", "(vii) Section 35H of the Excise Act provided for a reference, by , directly to . The instant reference by , could be made after had arrived at the conclusion, that the question of law arising for adjudication in an appeal pending before it, was differently interpreted by two or more jurisdictional . The decision of , would then be applied by , to decide the pending appeal. Section 35L provided for appeal to against the judgment rendered by (upon a reference made to by ). The decision of would then be applied by , in the disposal of the appeal pending before it. ", "(viii) The Finance (No. 32) Act, 2003 substituted Section 35G of the Excise Act and in place of the remedy of reference, the amended provision provided for a direct appeal to the jurisdictional (after the cut-off date, i.e., 1.7.2003). The jurisdictional was to entertain an appeal from an order passed by , on its being satisfied, that the appeal raised a substantial question of law. In such an eventuality, the would formulate the substantial question(s) of law. It was open to the in exercise of its instant appellate jurisdiction, also to determine any issue which had not been decided by , or had wrongly been decided by . The appeal preferred before the , would be heard by a bench of not less than two judges. Section 35L of the Excise Act was also amended. The amended provision provided for an appeal from any judgment of the (in exercise of its appellate jurisdiction under Section 35G of the Excise Act, or on a reference made under Section 35G by before 1.7.2003, or on a reference made under Section 35H ), to . ", "(ix) The Act omitted Sections 35G , 35H , 35I and 35J of the Excise Act. The instant enactment provided for an appeal from every order passed by to the , subject to the condition, that the was satisfied, that the case involved a substantial question of law. On admission of an appeal, the would formulate the substantial question of law, for hearing the appeal. Section 23 of the Act provided, that on and from the date to be notified by , all matters and proceedings including appeals and references, pertaining to direct/indirect taxes, pending before the jurisdictional , would stand transferred to the . Section 24 of the Act provided for an appeal from an order passed by the , to . ", "Facts leading to the promulgation of the NTT Act: ", "6. The first of independent India was established in 1955 for a three year term under the chairmanship of Mr. , who was also the first Attorney General for India. The idea of constituting a \u201c\u201d was mooted by the first in its 12th Report, suggesting the abolition of the existing appellate tribunal, under the framework of the Income Tax Act . It recommended a direct appeal to , from orders passed by appellate Commissioners. This recommendation was not accepted. ", "7. was set up by in 1970, with Mr. a retired Chief Justice of , as its Chairman. was assigned the following objectives: (1) to recommend ways to check avoidance of tax, through various legal lacunae; (2) to examine the exemptions allowed by tax laws, and evaluate scope of their reduction; and (3) to suggest methods for better tax assessment, and improvements in tax administration. recommended creation of a \u201c\u201d, which would be comprised of judges with special knowledge of tax laws. The recommendation made by , was for creation of permanent \u201cTax Benches\u201d in , and appointment of retired judges to such benches, under Article 224A of the Constitution. The suggestion was aimed at clearing the backlog of tax cases. did not suggest the establishment of any separate tax courts as that, according to the , would involve an amendment to the provisions of the Constitution, besides other statutory and procedural changes. ", "8. was constituted in 1977, under the chairmanship of Mr. , an eminent jurist. The Committee was later headed by Mr. . The Committee was constituted, to examine and suggest legal and administrative measures, for simplification and rationalization of direct tax laws. recommended the establishment of a \u201c\u201d with an all-India jurisdiction. It was suggested, that such a court be constituted under a separate statute. Just like the recommendations of , the recommendations of also necessitated amendments in the provisions of the Constitution. As an interim measure to the above recommendation, suggested, the desirability of constituting \u201cSpecial Tax Benches\u201d in , to deal with the large number of pending tax cases, by continuous sitting throughout the year. It was also suggested, that judges who sit on the \u201cSpecial Tax Benches\u201d, should be selected from those who had special knowledge, to deal with matters relating to direct tax laws. recommended, that the judges selected for the \u201cSpecial Tax Benches\u201d would be transferred to the \u201c\u201d, as and when the same was constituted. It is, therefore apparent, that according to the recommendations of , the \u201c\u201d was to comprise of judges of , or persons qualified to be appointed as Judges. The recommendations of reveal, that the suggested \u201c\u201d would be a special kind of , to deal with issues pertaining to direct tax laws. This was sought to be clarified in paragraph 6.22 of \u2019s Report. ", "9. None of the recommendations referred to hereinabove were implemented, till a similar recommendation was again mooted in the early 1990s. After deliberating on the issue for a few years, promulgated the National Tax Tribunal Ordinance, 2003. The Ordinance inter alia provided, for the transfer of appellate jurisdiction (under direct tax laws) vested in , to the . After the Ordinance lapsed, the National Tax Tribunal Bill, 2004 was introduced. The said Bill was referred to of the . granted a personal hearing to a variety of stakeholders, including the representatives of (i.e., the petitioner before this Court in Transferred Case (C) no. 150 of 2006). The Committee presented its report on 2.8.2005. In its report, it suggested serious reservations on the setting up of the . The above Bill was presented before in 2005. The Bill expressed four main reasons for setting up the : (1) to reduce pendency of huge arrears, that had mounted in all over the country, (2) huge tax recovery was statedly held up, in tax litigation before various , which directly impacted implementation of national projects/welfare schemes of , (3) to have a uniformity in the interpretation of tax laws. In this behalf it was suggested, that different opinions were expressed by different on identical tax issues, resulting in the litigation process being tied up in higher Courts, and (4) the existing judges dealing with tax cases, were from civil courts, and therefore, were not well-versed to decide complicated tax issues. ", "The issues canvassed on behalf of the petitioners: ", "10. The submissions advanced on behalf of the petitioners, for purposes of convenience, deserve to be examined from a series of distinct and separate perspectives. Each perspective is truly an independent submission. It is, therefore necessary, in the first instance, to clearly describe the different submissions, advanced at the hands of the learned counsel for the petitioners. The same are accordingly being delineated hereunder:- ", "The first contention: That the reasons for setting up the , were fallacious and non-existent. Since the foundational basis is untrue, the structure erected thereupon, cannot be accepted as valid and justified. And therefore, the same is liable to be struck down. ", "The second contention: It is impermissible for the legislature to abrogate/divest the core judicial appellate functions, specially the functions traditionally vested with . Furthermore, the transfer of such functions to a quasi-judicial authority, devoid of essential ingredients of the superior court, sought to be replaced was constitutionally impermissible, and was liable to be set aside. Besides the appellate jurisdiction, the power of judicial review vested in under Articles 226 and 227 of the Constitution, has also been negated by the NTT Act. And therefore, the same be set aside. The third contention: Separation of powers, the rule of law, and judicial review, constitute amongst others, the basic structure of the Constitution. Article 323B inserted by the Constitution (Forty-second Amendment) Act, 1976, to the extent it is violative of the above mentioned components of the basic structure of the Constitution, is liable to be declared ultra vires the Constitution. ", "The fourth contention: A number of provisions including Sections 5, 6, 7, 8 and 13 of the Act, undermine the independence of the adjudicatory process vested in the , and as such, are liable to be set aside in their present format. ", "11. We shall now narrate each of the above contentions advanced by the learned counsel for the petitioners, in the manner submissions were advanced before us. ", "The first contention: ", "12. As regards arrears of tax related cases before is concerned, it was submitted, that the figures indicated by the were incorrect. In this behalf it was asserted, that the stance adopted at the behest of the , that there were about 80,000 cases pending in different courts, was untrue. It was the emphatic contention of the learned counsel for the petitioners, that as of October, 2003 (when the National Tax Tribunal Ordinance, was promulgated), the arrears were approximately 29,000. Of the total pendency, a substantial number was only before a few , including and . In the petition filed by , it was asserted, that in , the pending appeals under Section 260A of the Income Tax Act, were less than 2,000. It was also sought to be asserted, that the pendency of similar appeals in most southern States was even lesser. It was pointed out, that the pendency of such appeals in and , was even lesser than 2,000. ", "13. In respect of the \u2019s assertion, that huge tax recovery was held up, in tax litigation, before , it was submitted, that the figures projected at the behest of the were incorrect. It was pointed out, that according to the , the pending cases in the involved an amount of approximately Rs.80,000 crores (relatable to direct tax cases). It was submitted, that the figures projected by the , included not only the basic tax, but interest and penalty imposed thereon, as well. It was pointed out, that interest could be as high as 40% per annum, under tax statutes, besides penal interest. It was accordingly sought to be canvassed, that if the main appeals were set aside by , there would hardly be any dues payable to the at all. Additionally, it was sought to be asserted, that many tax appeals pending before the , were filed by assessees, and accordingly, in the event of the assessees succeeding, the amount could not be considered as having been held up, but may have to be refunded. It was further asserted, that in most cases, the was able to recover a substantial amount from the assessees, by the time the matter reached (on account of pre-deposits). It was, therefore sought to be submitted, that the figures indicated by the , with reference to the amount of tax held up in pending cases, before was wholly flawed and deceptive. ", "14. It was also the contention of the learned counsel for the petitioners, that the mere establishment and creation of the , would not result in uniformity of decisions pertaining to tax laws. In this behalf it was sought to be asserted, that just as in the manner two could differ with one another, so also, could two tax benches, of the . On the factual front, it was pointed out, that divergence of opinion in was very rare. It was, as a matter of approximation, suggested, that in most cases (approximately 99%), one would follow the view taken by another . Learned counsel, however pointed out, that in an age-old mechanism, to resolve conflicts of views, by either placing such matters before larger benches, or before a higher court, was in place. Pointing out illustratively to the and the , it was asserted, that there had been many cases of divergence of opinion, which were resolved by larger benches. It was, therefore sought to be canvassed, that the instant basis for constituting the , was also not based on a prudent or sensible rationale. ", "15. On the subject of Judges being not well-versed to determine complicated interpretation of tax-law related issues, it was submitted, that the very mention of the above as a basis, for creating the NTT, was extremely unfortunate. It was submitted, that well before the independence of this country, and even thereafter, s have been interpreting and construing tax related disputes, in a legitimate, tenable and lawful manner. The fairness and rationale of tax related issues, according to learned counsel, was apparent from the faith reposed in s both by the , as well as, by the assessees. Furthermore, the veracity and truthfulness, of the instant assertion, according to the learned counsel, could be gauged from the fact, that interference by , in the orders passed by the s on tax matters, has been minimal. ", "16. During the course of hearing, our attention was also invited to the fact, that the legislations of the instant nature would have a lopsided effect. In this behalf it was sought to be pointed out, that while jurisdiction vested in was being excluded, the burden was being transferred to . This assertion was sought to be substantiated by the learned counsel for the petitioners, by inviting our attention to the legislations, wherein the power of judicial review traditionally vested in the , has been excluded, and a remedy of appeal has been provided from the tribunals constituted directly to . In this behalf, reference may illustratively be made to the following provisions:- ", "(i) The Electricity Act , 2003 ", "125. Appeal to - Any person aggrieved by any decision or order of , may, file an appeal to the within sixty days from the date of communication of the decision or order of to him, on any one or more of the grounds specified in Section 100 of the Code of Civil Procedure, 1908 (5 of 1908): ", "Provided that may, if it is satisfied that the appellant was prevented by sufficient cause from filing the appeal within the said period, allow it to be filed within a further period not exceeding sixty days. ", "(ii) The National Green Act , 2010 Section 22 . Appeal to \u2013 Any person aggrieved by any award, decision or order of the tribunal, may, file an appeal to the , within ninety days from the date of communication of the award, decision or order of , to him, on any one or more of the grounds specified in Section 100 of the Code of Civil Procedure, 1908 Provided that the may, entertain any appeal after the expiry of ninety days, if it is satisfied that the appellant was prevented by sufficient cause from preferring the appeal. ", "(iii) The Telecom Regulatory Authority of India Act , 1997 Section 18 . Appeal to Supreme Court \u2013 (1) Notwithstanding anything contained in the Code of Civil Procedure, 1908 or in any other law, an appeal shall lie against any order, not being an interlocutory order, of to on one or more of the grounds specified in section 100 of that code. ", "(2) No appeal shall lie against any decision or order made by with the consent of the parties. ", "(3) Every appeal under this section shall be preferred within a period of ninety days from the date of the decision or order appealed against: Provided that may entertain the appeal after the expiry of the said period of ninety days, if it is satisfied that the appellant was prevented by sufficient cause from preferring the appeal in time. ", "(iv) The Securities and Exchange Board of India Act , 1992 Section 15Z . Appeal to . \u2013 Any person aggrieved by any decision or order of may file an appeal to the within sixty days from the date of communication of the decision or order of to him on any question of law arising out to such order: ", "Provided that may, if it is satisfied that the applicant was prevented by sufficient cause from filing the appeal within the said period, allow it to be filed within a further period not exceeding sixty days. ", "(v) Companies Act , 1956 Section 10GF . Appeal to . \u2013 Any person aggrieved by any decision or order of may file an appeal to the within sixty days from the date of communication of the decision or order of to him on any question of law arising out of such decision or order: ", "Provided that may, if it is satisfied that the appellant was prevented by sufficient cause from filing the appeal within the said period, allow it to be filed within a further period not exceeding sixty days. ", "17. It was also pointed out, that the enactment of the NTT Act per se lacks bonafides. In this behalf the contention of the learned counsel for the petitioner was, that there is a ary convention that if rejects a Bill, it is normally not passed by the . At the very least, the reservations expressed by are taken into account, and the Bill in question is appropriately modified. It was submitted, that the bill under reference was presented before on 29.11.2005, and the same was passed without making a single amendment. ", "18. It was, therefore, the vehement contention of the learned counsel for the petitioners, that the foundational facts being incorrect, and the manner in which the bill was passed, being devoid of bonafides, the legislation itself i.e., the NTT Act, deserved to be set aside. ", "The second contention: ", "19. It was the emphatic contention of the learned counsel for the petitioners, that it was impermissible for the legislature to abrogate/divest the core judicial appellate functions traditionally vested with , and to confer/vest the same, with an independent quasi- judicial authority, which did not even have the basic ingredients of a superior Court, like (whose jurisdiction is sought to be transferred). In conjunction with the instant contention, it was also the submission of the learned counsel, that the jurisdiction vested in s under Articles 226 and 227 of the Constitution, is not only in respect of the rightful implementation of statutory provisions, but also of supervisory jurisdiction, over courts and tribunals, cannot be curtailed under any circumstances. ", "20. In order to supplement the instant contention, learned counsel also placed reliance on Article 225 of the Constitution which is being extracted hereunder:- ", "\u201c225. Jurisdiction of existing s - Subject to the provisions of this Constitution and to the provisions of any law of the appropriate made by virtue of powers conferred on that by this Constitution, the jurisdiction of, and the law administered in, any existing , and the respective powers of the Judges thereof in relation to the administration of justice in the , including any power to make rules of and to regulate the sittings of the court and of members thereof sitting alone or in Division s, shall be the same as immediately before the commencement of this Constitution: ", "Provided that any restriction to which the exercise of original jurisdiction by any of the High s with respect to any matter concerning the revenue or concerning any act ordered or done in the collection thereof was subject immediately before the commencement of this Constitution shall no longer apply to the exercise of such jurisdiction.\u201d Inviting the \u2019s attention to the proviso to Article 225 of the Constitution it was submitted, that the original jurisdiction of High s on matters pertaining to revenue or the collection thereof, even if considered as barred, the said bar was ordered to be expressly done away with, by the proviso to Article 225 of the Constitution. In the present context, learned counsel for the petitioners invited our attention to Section 226(1) of the Government of India Act, 1935. The said Section is reproduced hereunder:- ", "\u201c226(1) Until otherwise provided by Act of the appropriate Legislature, no High Court shall have any original Jurisdiction in any matter concerning the revenue, or concerning any act ordered or done in the collection thereof according to the usage and practice of the country or the law for the time being in force.\u201d It was submitted, that under the above statutory provision, could not issue a writ in the nature of mandamus, to call upon a Revenue authority to discharge its statutory obligations, in respect of the assessment of tax. Likewise, it was not open to , to issue a writ in the nature of certiorari or certiorarified mandamus, in order to set aside or modify an order of assessment, passed in violation of or in contravention of any statutory provision(s). It was submitted, that the proviso to Article 225 of the Constitution, as has been extracted hereinabove, was omitted by the Constitution (Forty-second Amendment) Act, 1976 (with effect from 1.2.1977). It was, however pointed out, that the having realized its mistake, restored the proviso to Article 225 of the Constitution, as was originally enacted by the Constitution (Forty- fourth Amendment) Act , 1978 (with effect from 20.6.1979). Thus viewed, according to the learned counsel for the petitioners, under the provisions of the Constitution, prevailing at the present juncture, the original jurisdiction of (i.e., the jurisdiction under Articles 226 and 227 of the Constitution), as also, the law administered by at the time of enactment of the Constitution, cannot be restricted. Accordingly, it was asserted, that on matters pertaining to revenue or the collection thereof, the adjudication authority of , could not be curtailed. ", "21. Articles 226 and 227 of the Constitution, on which emphatic reliance has been placed by the learned counsel, are being reproduced hereunder:- \u201c226. Power of High Courts to issue certain writs \u2013 (1) Notwithstanding anything in article 32 , every High Court shall have power, throughout the territories in relation to which it exercises jurisdiction, to issue to any person or authority, including in appropriate cases, any Government, within those territories directions, orders or writs, including writs in the nature of habeas corpus, mandamus, prohibition, quo warranto and certiorari, or any of them, for the enforcement of any of the rights conferred by Part III and for any other purpose. ", "(2) The power conferred by clause (1) to issue directions, orders or writs to any , authority or person may also be exercised by any High Court exercising jurisdiction in relation to the territories within which the cause of action, wholly or in part, arises for the exercise of such power, notwithstanding that the seat of such or authority or the residence of such person is not within those territories. (3) Where any party against whom an interim order, whether by way of injunction or stay or in any other manner, is made on, or in any proceedings relating to, a petition under clause (1), without \u2013 ", "(a) furnishing to such party copies of such petition and all documents in support of the plea for such interim order; and ", "(b) giving such party an opportunity of being heard, makes an application to for the vacation of such order and furnishes a copy of such application to the party in whose favour such order has been made or the counsel of such party, shall dispose of the application within a period of two weeks from the date on which it is received or from the date on which the copy of such application is so furnished, whichever is later, or where is closed on the last day of that period, before the expiry of the next day afterwards on which is open; and if the application is not so disposed of, the interim order shall, on the expiry of that period, or, as the case may be, the expiry of the aid next day, stand vacated. ", "(4) The power conferred on by this article shall not be in derogation of the power conferred on by clause (2) of Article 32. ", "227. Power of superintendence over all courts by \u2013 (1) shall have superintendence over all courts and tribunals throughout the territories in relation to which it exercises jurisdiction. ", "(2) Without prejudice to the generality of the foregoing provisions, may - ", "(a) call for returns from such courts; ", "(b) make and issue general rules and prescribe forms for regulating the practice and proceedings of such courts; and ", "(c) prescribe forms in which books, entries and accounts shall be kept by the officers of any such courts. ", "(3) may also settle tables of fees to be allowed to the sheriff and all clerks and officers of such courts and to attorneys, advocates and pleaders practising therein: ", "Provided that any rules made, forms prescribed or tables settled under clause (2) or clause (3) shall not be inconsistent with the provision of any law for the time being in force, and shall require the previous approval of the Governor. ", "(4) Nothing in this article shall be deemed to confer on a powers of superintendence over any court or tribunal constituted by or under any law relating to .\u201d It was submitted, that the above original jurisdiction vested in the to issue prerogative writs, has been shown to have been consciously preserved, for matters pertaining to levy and collection of tax. It was also submitted, that the enactment of the Act has the clear and explicit effect, of excluding the jurisdiction of the s. This was sought to be explained by indicating, that the jurisdiction to adjudicate appeals, traditionally determined by jurisdictional s, from orders passed by Appellate Tribunals under the Income Tax Act , the Customs Act and the Excise Act (all taxing legislations) have been taken out of the purview of the s, and have been vested with the , by the Act. It was further submitted, that even the jurisdiction vested in s under Articles 226 and 227 of the Constitution, has been practically done away with. In this behalf the explanation was, that by providing for an appellate remedy against an order passed by the , directly to , the above original jurisdiction of the s, had practically been frustrated and effectively neutralized. It is pointed out, that the curtailment of the jurisdiction of the s under Articles 226 and 227 of the Constitution, must be viewed as submission, distinct and separate from the one emerging out of the substitution of, the jurisdiction of the s under Section 260A of the Income Tax Act, 1961, Section 130 of the Customs Act, and Section 35G of the Excise Act. Whilst the former contention is based on a clear constitutional right, the submission based on the provisions of the taxing statutes, emerges from a well accepted constitutional convention, coupled with the clear intent expressed in the proviso to Article 225 of the Constitution. ", "22. In order to support the second contention advanced by the petitioners, the following decisions were relied upon: ", "(i) Reliance was first of all, placed on the decision of in v. v. Attorney General of Jamaica (Intervener), 1976 All ER Vol. (1) 353. The factual/legal position which arose for determination in the cited case pertained to Act, 1974, enacted by . The aforesaid enactment was made, without following the special procedure prescribed by Section 49 of the Constitution of Jamaica (to alter the provisions of the Constitution of Jamaica). The Gun Court Act, 1974, had the effect of creating a new Court \u2013 \u201c\u201d, to sit in three different kinds of divisions: , and . One or the other of these divisions, was conferred with the jurisdiction to try, different categories of offenders of criminal offences. Prior to the passing of the Act, and at the date of coming into force of the Constitution, these offences were cognizable only before , or before of . The Gun Court Act, 1974, also laid down the procedure to be followed (in each of the divisions). For certain specified offences relating to unauthorized possession, acquisition or disposal of firearms and ammunition, \u201c\u201d was required to mandatorily impose a sentence of detention on hard labour. A detenue could only be discharged, at the direction of the Governor-General, acting in accordance with the advice of . was a non- judicial body under Act, 1974. ", "Lord while recording the majority view in case (supra), observed as under:- ", "\u201c\u2026..In seeking to apply to the interpretation of the Constitution of Jamaica what has been said in particular cases about other constitutions, care must be taken to distinguish between judicial reasoning which depended on the express words used in the particular constitution under consideration and reasoning which depended on what, though not expressed, is nonetheless a necessary implication from the subject-matter and structure of the constitution and the circumstances in which it had been made. Such caution is particularly necessary in cases dealing with a federal constitution in which the question immediately in issue may have depended in part on the separation of the judicial power from the legislative or executive power of the federation or of one of its component states and in part upon the division of judicial power between the federation and a component state. ", "Nevertheless all these constitutions have two things in common which have an important bearing on their interpretation. They differ fundamentally in their nature from ordinary legislation passed by the parliament of a sovereign state. They embody what is in substance an agreement reached between representatives of the various shades of political opinion in the state as to the structure of the organs of government through which the plenitude of the sovereign power of the state is to be exercised in future. All of them were negotiated as well as drafted by persons nurtured in the tradition of that branch of the common law of England that is concerned with public law and familiar in particular with the basic concept of separation of legislative, executive and judicial power as it had been developed in the unwritten constitution of the United Kingdom. As to their subject-matter, the peoples for whom new constitutions were being provided were already living under a system of public law in which the local institutions through which government was carried on, the legislature, the executive and the courts, reflected the same basic concept. The new constitutions, particularly in the case of unitary states, were evolutionary not revolutionary. They provided for continuity of government through successor institutions, legislative, executive and judicial, of which the members were to be selected in a different way, but each institution was to exercise powers which, although enlarged, remained of a similar character to those that had been exercised by the corresponding institution that it had replaced. ", "Because of this a great deal can be, and in drafting practice often is, left to necessary implication from the adoption in the new constitution of a governmental structure which makes provision for a legislature, an executive and a . It is taken for granted that the basic principle of separation of powers will apply to the exercise of their respective functions by these three organs of government. Thus the constitution does not normally contain any express prohibition on the exercise of legislative powers by the executive or of judicial powers by either the executive or the legislature. As respects the , particularly if it is intended that the previously existing courts shall continue to function, the constitution itself may even omit any express provision conferring judicial power upon the . Nevertheless it is well established as a rule of construction applicable to constitutional instruments under which this governmental structure is adopted that the absence of express words to that effect does not prevent the legislative, the executive and the judicial powers of the new state being exercisable exclusively by the legislature, by the executive and by the respectively. To seek to apply to constitutional instruments the canons of construction applicable to ordinary legislation in the fields of substantive criminal or civil law would, in their Lordships' view, be misleading - particularly those applicable to taxing statutes as to which it is a well-established principle that express words are needed to impose a charge on the subject. ", "In the result there can be discerned in all those constitutions which have their origin in an Act of the Imperial Parliament at or in an Order in Council, a common pattern and style of draftsmanship which may conveniently be described as \u2018the model.\u2019 Before turning to those express provisions of the Constitution of Jamaica upon which the appellants rely in these appeals, their Lordships will make some general observations about the interpretation of constitutions which follow the model. ", "All Constitutions on the model deal under separate Chapter headings with the legislature, the executive and the judicature. The Chapter dealing with the judicature invariably contains provisions dealing with the method of appointment and security of tenure of the members of the judiciary which are designed to assure to them a degree of independence from the other two branches of government. It may, as in the case of the Constitution of Ceylon, contain nothing more. To the extent to which the Constitution itself is silent as to the distribution of the plenitude of judicial power between various courts it is implicit that it shall continue to be distributed between and exercised by the courts that were already in existence when the new Constitution came into force; but the legislature, in the exercise of its power to make laws for the \u2018peace, order and good government\u2019 of the state, may provide for the establishment of new courts and for the transfer to them of the whole or part of the jurisdiction previously exercisable by an existing court. What, however, is implicit in the very structure of a Constitution on the model is that judicial power, however it be distributed from time to time between various courts, is to continue to be vested in persons appointed to hold judicial office in the manner and on the terms laid down in the Chapter dealing with the judicature, even though this is not expressly stated in the Constitution (Liyanage v. R. [1966] 1 All ER 650 at 658, [1967] A.C. 259 at 287, 288). ", "The more recent constitutions on the model, unlike their earlier prototypes, include a Chapter dealing with fundamental rights and freedoms. The provisions of this Chapter form part of the substantive law of the state and until amended by whatever special procedure is laid down in the Constitution for this purpose, impose a fetter upon the exercise by the legislature, the executive and the judiciary of the plenitude of their respective powers. The remaining Chapters of the Constitutions are primarily concerned not with the legislature, the executive and the judicature as abstractions, but with the persons who shall be entitled collectively or individually to exercise the plenitude of legislative, executive or judicial powers - their qualifications for legislative, executive or judicial office, the methods of selecting them, their tenure of office, the procedure to be followed where powers are conferred on a class of persons acting collectively and the majorities required for the exercise of those powers. Thus, where a constitution on the model speaks of a particular \u2018court\u2019 already in existence when the Constitution comes into force it uses this expression as a collective description of all those individual judges who, whether sitting alone or with other judges or with a jury, are entitled to exercise the jurisdiction exercised by that court before the Constitution came into force. Any express provision in the constitution for the appointment or security of tenure of judges of that court will apply to all individual judges subsequently appointed to exercise an analogous jurisdiction, whatever other name may be given to the \u2018court\u2019 in which they sit (Attorney-General for Ontario v. Attorney-General for Canada) [1925] A.C. 750. Where, under a constitution on the model, a law is made by the which purports to confer jurisdiction on a court described by a new name, the question whether the law conflicts with the provisions of the constitution dealing with the exercise of the judicial power does not depend upon the label (in the instant case \u2018The Gun Court\u2019) which the attaches to the judges when exercising the jurisdiction conferred on them by the law whose constitutionality is impugned. It is the substance of the law that must be regarded, not the form. What is the nature of the jurisdiction to be exercised by the judges who are to compose the court to which the new label is attached? Does the method of their appointment and the security of their tenure conform to the requirements of the constitution applicable to judges who, at the time the constitution came into force, exercised jurisdiction of that nature? (Attorney-General for \u2019 Society of Australia, A.C. 288, 309-310). ", "xxx xxx xxx \u2026..So in deciding whether any provisions of a law passed by as an ordinary law are inconsistent with the Constitution of Jamaica, neither the courts of Jamaica nor their Lordships' Board are concerned with the propriety or expediency of the law impugned. They are concerned solely with whether those provisions, however reasonable and expedient, are of such a character that they conflict with an entrenched provision of the Constitution and so can be validly passed only after the Constitution has been amended by the method laid down by it for altering that entrenched provision.\u201d The question examined by in the background of the factual/legal position expressed above, was recorded in the following words:- ", "\u201cThe attack on the constitutionality of of may be based on two grounds. The first is that Act 1974 purports to confer on a court consisting of persons qualified and appointed as resident magistrates a jurisdiction which under the provisions of Chapter VII of the Constitution is exercisable only by a person qualified and appointed as a judge of . The second ground is much less fundamental. It need only be mentioned briefly, for it arises only if the first ground fails. It is that even if the conferment of jurisdiction on a Division consisting of three resident magistrates is valid, section 112 of the Constitution requires that any assignment of a resident magistrate to sit in that division should be made by the Governor- General acting on the recommendation of and not by the Chief Justice as the 1974 Act provides.\u201d The question was dealt with, by opining as under:- ", "\u201cChapter VII of the Constitution, \u2018The Judicature,\u2019 was in their Lordships' view intended to deal with the appointment and security of tenure of all persons holding any salaried office by virtue of which they are entitled to exercise civil or criminal jurisdiction in Jamaica. For this purpose they are divided into two categories: (i) a higher judiciary, consisting of judges of and judges of , and (ii) a lower judiciary, consisting of those described in section 112 (2) , viz.: \u2018... Resident magistrate, judge of , Registrar of , Registrar of and such other offices connected with the courts of Jamaica as, subject to the provisions of this Constitution, may be prescribed by .\u2019 Apart from the offices of judge and registrar of which were new, these two categories embraced all salaried members of the judiciary who exercised civil or criminal jurisdiction in Jamaica at the date when the Constitution came into force. A minor jurisdiction, particularly in relation to juveniles, was exercised by justices of the peace but, as in England, they sat part-time only, were unpaid and were not required to possess any professional qualification. Common to both categories, with the exception of the Chief Justice of and the President of , is the requirement under the Constitution that they should be appointed by the Governor- General on the recommendation of - a body established under section 111 whose composition is different from that of and consists of persons likely to be qualified to assess the fitness of a candidate for judicial office. The distinction between the higher judiciary and the lower judiciary is that the former are given a greater degree of security of tenure than the latter. There is nothing in the Constitution to protect the lower judiciary against passing ordinary laws (a) abolishing their office (b) reducing their salaries while they are in office or (c) providing that their appointments to judicial office shall be only for a short fixed term of years. Their independence of the good-will of the political party which commands a bare majority in the is thus not fully assured. The only protection that is assured to them by section 112 is that they cannot be removed or disciplined except on the recommendation of with a right of appeal to . This last is a local body established under section 82 of the Constitution whose members are appointed by the Governor-General after consultation with the Prime Minister and hold office for a period not exceeding three years. In contrast to this, judges of and of are given a more firmly rooted security of tenure. They are protected by entrenched provisions of the Constitution against passing ordinary laws (a) abolishing their office (b) reducing their salaries while in office or (c) providing that their tenure of office shall end before they attain the age of 65 years. They are not subject to any disciplinary control while in office. They can only be removed from office on the advice of of Her Majesty's in the United Kingdom given on a reference made on the recommendation of a tribunal of inquiry consisting of persons who hold or have held high judicial office in some part of the . ", "The manifest intention of these provisions is that all those who hold any salaried judicial office in Jamaica shall be appointed on the recommendation of and that their independence from political pressure by or by the in the exercise of their judicial functions shall be assured by granting to them such degree of security of tenure in their office as is justified by the importance of the jurisdiction that they exercise. A clear distinction is drawn between the security of tenure appropriate to those judges who exercise the jurisdiction of the higher judiciary and that appropriate to those judges who exercise the jurisdiction of the lower judiciary. Their Lordships accept that there is nothing in the Constitution to prohibit from establishing by an ordinary law a court under a new name, such as ,\" to exercise part of the jurisdiction that was being exercised by members of the higher judiciary or by members of the lower judiciary at the time when the Constitution came into force. To do so is merely to change the label to be attached to the capacity in which the persons appointed to be members of the new court exercise a jurisdiction previously exercised by the holders of one or other of the judicial offices named in Chapter VII of the Constitution. In their Lordships' view, however, it is the manifest intention of the Constitution that any person appointed to be a member of such a court should be appointed in the same manner and entitled to the same security of tenure as the holder of the judicial office named in Chapter VII of the Constitution which entitled him to exercise the corresponding jurisdiction at the time when the Constitution came into force. ", "Their Lordships understand the Attorney-General to concede that salaried judges of any new court that may establish by an ordinary law must be appointed in the manner and entitled to the security of tenure provided for members of the lower judiciary by section 112 of the Constitution. In their Lordships' view this concession was rightly made. To adopt the familiar words used by Viscount in Attorney-General of Australia v. and Boilermakers\u2019 Society of Australia A.C. 288, 309- 310, it would make a mockery of the Constitution if could transfer the jurisdiction previously exercisable by holders of the judicial offices named in Chapter VII of the Constitution to holders of new judicial offices to which some different name was attached and to provide that persons holding the new judicial offices should not be appointed in the manner and on the terms prescribed in Chapter VII for the appointment of members of the judicature. If this were the case there would be nothing to prevent from transferring the whole of the judicial power of Jamaica (with two minor exceptions referred to below) to bodies composed of persons who, not being members of \u2018the ,\u2019 would not be entitled to the protection of Chapter VII at all. ", "What the Attorney-General does not concede is that is prohibited by Chapter VII from transferring to a court composed of duly appointed members of the lower judiciary jurisdiction which, at the time the Constitution came into force, was exercisable only by a court composed of duly appointed members of the higher judiciary. ", "In their Lordships' view section 110 of the Constitution makes it apparent that in providing in section 103 (1) that: \u2018There shall be a for Jamaica \u2026\u2019 the draftsman treated this form of words as carrying with it by necessary implication that the judges of the court required to be established under section 103 should exercise an appellate jurisdiction in all substantial civil cases and in all serious criminal cases; and that the words that follow, viz. \u2018which shall have such jurisdiction and powers as may be conferred upon it by this Constitution or any other law,\u2019 do not entitle by an ordinary law to deprive of a significant part of such appellate jurisdiction or to confer it on judges who do not enjoy the security of tenure which the Constitution guarantees to judges of . Section 110 (1) of the Constitution which grants to litigants wide rights of appeal to Her Majesty in Council but only from \u2018decisions of ,\u2019 clearly proceeds on this assumption as to the effect of section 103 , Section 110 would be rendered nugatory if its wide appellate jurisdiction could be removed from by an ordinary law without amendment of the Constitution. Their Lordships see no reason why a similar implication should not be drawn from the corresponding words of section 97 . was a new court established under the Judicature (Appellate Jurisdiction) Law 1962 , which came into force one day before the Constitution, viz. on 5 August, 1962. had existed under that title since 1880. In the judges of that court there had been vested all that jurisdiction in Jamaica which in their Lordships' view was characteristic of a court to which in 1962 the description \u2018\u2019 was appropriate in a hierarchy of courts which was to include a separate \u2018.\u2019 The three kinds of jurisdiction that are characteristic of where appellate jurisdiction is vested in a separate court are: (1) unlimited original jurisdiction in all substantial civil cases; (2) unlimited original jurisdiction in all serious criminal offences; (3) supervisory jurisdiction over the proceedings of inferior courts (viz. of the kind which owes its origin to the prerogative writs of certiorari, mandamus and prohibition). ", "That section 97 (1) of the Constitution was intended to preserve in Jamaica exercising this characteristic jurisdiction is, in their Lordships' view, supported by the provision in section 13 (1) of the Jamaica (Constitution) Order in Council 1962, that \u2018 in existence immediately before the commencement of this Order shall be for the purposes of the Constitution.\u2019 This is made an entrenched provision of the Constitution itself by section 21 (1) of the Order in Council, and confirms that the kind of court referred to in the words \u2018There shall be for Jamaica\u2019 was a court which would exercise in Jamaica the three kinds of jurisdiction characteristic of that have been indicated above. ", "If, as contended by the Attorney-General, the words italicised above in section 97 (1) entitled by an ordinary law to strip of all jurisdiction in civil and criminal cases other than that expressly conferred upon it by section 25 and section 44 , what would be left would be a court of such limited jurisdiction that the label \u2018\u2019 would be a false description; so too if all its jurisdiction (with those two exceptions) were exercisable concurrently by other courts composed of members of the lower judiciary. But more important, for this is the substance of the matter, the individual citizen could be deprived of the safeguard, which the makers of the Constitution regarded as necessary, of having important questions affecting his civil or criminal responsibilities determined by a court, however named, composed of judges whose independence from all local pressure by or by the executive was guaranteed by a security of tenure more absolute than that provided by the Constitution for judges of inferior courts. Their Lordships therefore are unable to accept that the words in section 97 (1), upon which the Attorney-General relies, entitle by an ordinary law to vest in a new court composed of members of the lower judiciary a jurisdiction that forms a significant part of the unlimited civil, criminal or supervisory jurisdiction that is characteristic of a \u2018\u2019 and was exercised by of Jamaica at the time when the Constitution came into force, at any rate where such vesting is accompanied by ancillary provisions, such as those contained in section 6 (1) of the Gun Court Act 1974 , which would have the consequence that all cases falling within the jurisdiction of the new court would in practice be heard and determined by it instead of by a court composed of judges of . ", "xxxx xxxx xxxx In their Lordships' view the provisions of the 1974 Act, in so far as they provide for the establishment of a of consisting of three resident magistrates, conflict with Chapter VII of the Constitution and are accordingly void by virtue of section 2 . ", "xxxx xxxx xxxx Thus , in the exercise of its legislative power, may make a law imposing limits upon the discretion of the judges who preside over the courts by whom offences against that law are tried to inflict on an individual offender a custodial sentence the length of which reflects the judge's own assessment of the gravity of the offender's conduct in the particular circumstance of his case. What cannot do, consistently with the separation of powers, is to transfer from the judiciary to any executive body whose members are not appointed under Chapter VII of the Constitution, a discretion to determine the severity of the punishment to be inflicted upon an individual member of a class of offenders. Whilst none would suggest that composed as is provided in section 22 of the Gun Court Act 1974 would not perform its duties responsibly and impartially, the fact remains that the majority of its members are not persons qualified by the Constitution to exercise judicial powers. A breach of a constitutional restriction is not excused by the good intentions with which the legislative power has been exceeded by the particular law. If, consistently with the Constitution, it is permissible for the to confer the discretion to determine the length of custodial sentences for criminal offences on a body composed as is, it would be equally permissible to a less well- intentioned to confer the same discretion on any other person or body of persons not qualified to exercise judicial powers, and in this way, without any amendment of the Constitution, to open the door to the exercise of arbitrary power by the executive in the whole field of criminal law. ", "xxxx xxxx xxxx Their Lordships would hold that the provisions of section 8 of the Act relating to the mandatory sentence of detention during the Governor- General's pleasure and the provisions of section 22 relating to are a law made after the coming into force of the Constitution which is inconsistent with the provisions of the Constitution relating to the separation of powers. They are accordingly void by virtue of section 2 of the Constitution.\u201d ", "(ii) In the same sequence, learned counsel for the petitioners invited our attention to Liyanage v. , (1966) 1 All ER 650. It is first necessary to record the factual/legal matrix, in the cited judgment. All the 11 appellants in the matter before , were charged with offences arising out of an abortive coup d\u2019e\u2019tat on 27.1.1962. The factum of the said coup d\u2019e\u2019tat, was set out in a White Paper issued by on 13.2.1962. The White Paper gave the names of 13 alleged conspirators including the appellants. The White Paper concluded by observing, that a deterrent punishment of a severe character ought to be imposed, on all those who were guilty. On 16.3.1962, the Criminal Law (Special Provisions) Act, No. 1 of 1962 was passed. It was given retrospective effect from 1.1.1962. It was limited in operation to those who were accused of offences against the , on or around 27.1.1962. The above Act legalized imprisonment of the appellants, while they were awaiting trial. It modified a section of the Penal Code , so as to enact ex post facto, a new offence, to meet the circumstance of the abortive coup. It altered ex post facto, the law of evidence, regarding settlements made by an accused, while in custody. It enacted a minimum punishment, accompanied by forfeiture of property, for the offences for which the appellants were tried. Under Section 440A of the Criminal Procedure Code, trial in case of sedition, could be directed to be before three judges without a jury. The instant provision was amended by the above Act, so as to extend the same, to the offences for which the appellants were charged. Under Section 9 of the above Act, the Minister of Justice was empowered to nominate the three judges. In exercise of his powers under Section 9 , the Minister of Justice had nominated three judges, to try the appellants without a jury. upheld the objection raised by the appellants, that Section 9 was ultra vires the Constitution of Ceylon, and that, the nomination was invalid. Thereafter, the Criminal Law Act , No. 31 of 1962 was passed. It repealed Section 9 of the earlier Act. It amended the power of nomination, in that, the power was conferred on the Chief Justice. On appeal by the appellants, against the conviction and sentence from their trial before judges nominated under the Act, it was held, that the Criminal Law (Special Provisions) Act, No. 1 of 1962, as well as, the Criminal Law Act , No. 31 of 1962, were invalid for the two reasons. Firstly, under the Constitution of Ceylon, there was a separation of powers. The power of the judicature, while the Constitution stood, could not be usurped or infringed by the executive or the legislature. Secondly, the Criminal Law (Special Provisions) Act, No. 1 of 1962, as well as, the Criminal Law Act , No. 31 of 1962 were aimed at individuals concerned in an abortive coup, and were not legislation effecting criminal law of general application. Although not every enactment ad hominem, and ex post facto, necessarily infringed the judicial power, yet there was such infringement in the present case, by the above two Acts. In addition to the above conclusions, it was also held, that the joint effect of the Ceylon Constitution Order in Council 1946, and the Ceylon Independence Act, 1947, was intended to, and resulted in, giving , full legislative powers of an independent sovereign . Consequently, the legislative power of , was not limited by inability to pass laws, which offended fundamental principles of justice. while examining the above controversy, rendered the following opinion:- ", "\u201cIn Ceylon, however, the position was different. The change of sovereignty did not in itself produce any apparent change in the constituents or the functioning of the . So far as the courts were concerned their work continued unaffected by the new Constitution, and the Ordinances under which they functioned remained in force. The judicial system had been established in Ceylon by the Charter of Justice in 1833. Clause 4 of the Charter read: ", "\"And to provide for the administration of justice hereafter in Our said Island Our will and pleasure is, and We do hereby direct that the entire administration of justice, civil and criminal therein, shall be vested exclusively in the courts erected and constituted by this Our Charter ... and it is Our pleasure and We hereby declare, that it is not, and shall not be competent to the Governor of Our said Island by any Law or Ordinance to be by him made, with the advice of the Legislative Council thereof or otherwise howsoever, to constitute or establish any court for the administration of justice in any case civil or criminal, save as hereinafter is expressly saved and provided.\" ", "Clause 5 established and clause 6 a Chief Justice and two puisne judges. Clause 7 gave the Governor powers of appointing their successors. There follow many clauses with regard to administrative, procedural and jurisdictional matters. Some half a century later Ordinances (in particular the Courts Ordinance) continued the jurisdiction and procedure of the courts. Thereunder the courts have functioned continuously up to the present day. ", "xxx xxx xxx The Constitution is significantly divided into parts - \"Part 2 The Governor- General,\" \"Part 3 The Legislature,\" \"Part 4 Delimitation of Electoral Districts,\" \"Part 5 The Executive,\" \"Part 6 The Judicature,\" \"Part 7 The Public Service,\" \"Part 8 Finance.\" And although no express mention is made of vesting in the judicature the judicial power which it already had and was wielding in its daily process under the Courts Ordinance, there is provision under Part 6 for the appointment of judges by which shall not contain a member of either , but shall be composed of the Chief Justice and a judge and another person who is or shall have been a judge. Any attempt to influence any decision of the is made a criminal offence. There is also provision that judges shall not be removable except by the Governor-General on an address of both s. ", "These provisions manifest an intention to secure in the judiciary a freedom from political, legislative and executive control. They are wholly appropriate in a Constitution which intends that judicial power shall be vested only in the judicature. They would be inappropriate in a Constitution by which it was intended that judicial power should be shared by the executive or the legislature. The Constitution's silence as to the vesting of judicial power is consistent with its remaining, where it had lain for more than a century, in the hands of the judicature. It is not consistent with any intention that henceforth it should pass to or be shared by, the executive or the legislature. ", "Counsel for the appellants succinctly summarises his attack on the Acts in question as follows. The first Act was wholly bad in that it was a special direction to the judiciary as to the trial of particular prisoners who were identifiable (in view of the White Paper) and charged with particular offences on a particular occasion. The pith and substance of both Acts was a legislative plan ex post facto to secure the conviction and enhance the punishment of those particular individuals. It legalised their imprisonment while they were awaiting trial. It made admissible their statements inadmissibly obtained during that period. It altered the fundamental law of evidence so as to facilitate their conviction. and finally it altered ex post facto the punishment to be imposed on them. ", "In their Lordships' view that cogent summary fairly describes the effect of the Acts. As has been indicated already, legislation ad hominem which is thus directed to the course of particular proceedings may not always amount to an interference with the functions of the judiciary. But in the present case their Lordships have no doubt that there was such interference; that it was not only the likely but the intended effect of the impugned enactments; and that it is fatal to their validity. The true nature and purpose of these enactments are revealed by their conjoint impact on the specific proceedings in respect of which they were designed, and they take their colour, in particular, from the alterations they purported to make as to their ultimate objective, the punishment of those convicted. These alterations constituted a grave and deliberate incursion into the judicial sphere. Quite bluntly, their aim was to ensure that the judges in dealing with these particular persons on these particular charges were deprived of their normal discretion as respects appropriate sentences. They were compelled to sentence each offender on conviction to not less than ten years' imprisonment, and compelled to order confiscation of his possessions, even though his part in the conspiracy might have been trivial. ", "The trial court concluded its long and careful judgment with these words ((1965), 67 CNLR at p. 424): ", "\"But we must draw attention to the fact that the Act of 1962 radically altered ex post facto the punishment to which the defendants are rendered liable. The Act removed the discretion of the court as to the period of the sentence to be imposed, and compels the court to impose a term of 10 years' imprisonment, although we would have wished to differentiate in the matter of sentence between those who organised the conspiracy and those who were induced to join it. It also imposes a compulsory forfeiture of property. These amendments were not merely retroactive: they were also ad hoc, applicable only to the conspiracy which was the subject of the charges we have tried. We are unable to understand this discrimination. To the courts, which must be free of political bias, treasonable offences are equally heinous, whatever be the complexion of the in power or whoever be the offenders.\" ", "Their Lordships sympathise with that protest and wholly agree with it. One might fairly apply to these Acts the words of , in in v. : \"These acts were legislative judgments; and an exercise of judicial power.\" ", " in his Commentaries, Vol. I (4th Edition), p. 44, wrote: \"Therefore a particular act of the legislature to confiscate the goods of , or to attaint him of high treason does not enter into the idea of a municipal law: for the operation of this act is spent upon only and has no relation to the community in General: it is rather a sentence than a law.\" ", "If such Acts as these were valid the judicial power could be wholly absorbed by the legislature and taken out of the hands of the judges. It is appreciated that the legislature had no such general intention. It was beset by a grave situation and it took grave measures to deal with it, thinking, one must presume, that it had power to do so and was acting rightly; But that consideration is irrelevant, and gives no validity to acts which infringe the Constitution. What is done once, if it be allowed, may be done again and in a lesser crisis and less serious circumstances; and thus judicial power may be eroded. Such an erosion is contrary to the clear intention of the Constitution. In their Lordships' view the Acts were ultra vires and invalid. ", "xxx xxx xxx It was agreed between the parties that if the Acts were ultra vires and invalid, the convictions cannot stand. Their Lordships have therefore humbly advised Her Majesty that this appeal should be allowed and that the convictions should be quashed.\u201d ", "(iii) Reference was then made to Director of Public Prosecutions of Jamaica v. , (2003) 2 AC 411. The factual controversy which led to the above cited decision of may be noticed. On 16.3.1994, when Kurt was merely 16 years old, he committed a murder in furtherance of a robbery. His offence was described as a \u201ccapital murder\u201d, under the law of Jamaica. After his trial, he was convicted on 21.4.1997, when he was 19 years old. On 25.4.997, he was sentenced under Section 29(1) of the Juveniles Act, 1951, to be detained during the Governor- General\u2019s pleasure. On 16.2.2000, although refused his prayer for leave to appeal against his conviction, it agreed to examine his contention, whether the sentence imposed on him was compatible with the provisions of the Constitution of Jamaica. accepted his contention. The sentence of detention, during the Governor-General\u2019s pleasure, was set aside. In its place, he was sentenced to life imprisonment, with the recommendation that, he be not considered for parole till he had served a term of 20 years\u2019 imprisonment. In the controversy which came up for consideration before , there were two main issues. Firstly, whether the sentence of detention during the Governor-General\u2019s pleasure authorized by Section 29(1) , was a power exercised by him in his executive capacity. And secondly, whether the power to determine the measure for punishment to be inflicted on an offender, is compatible with the Constitution. , while examining the controversy, opined as under:- ", "1 \u201cSection 29 of the Juveniles Act 1951 [3] Section 3 of the Offences against the Person Act 1864, as amended, provides that every person convicted of capital murder shall be sentenced to death. But special provision has been made for those who commit this crime when aged under 18. Following a number of amendments made pursuant to section 4 of the Jamaica (Constitution) Order in Council 1962 (SI 1962/1500), section 29 of the Juveniles Act 1951 now provides, so far as material to the main issue in this appeal, as follows: \"(1) Sentence of death shall not be pronounced on or recorded against a person convicted of an offence if it appears to the court that at the time when the offence was committed he was under the age of 18 years, but in place thereof the court shall sentence him to be detained during Her Majesty's pleasure, and, if so sentenced, he shall, notwithstanding anything in the other provisions of this Law, be liable to be detained in such place (including, save in the case of a child, an adult correctional centre) and under such conditions as the Minister may direct, and while so detained shall be deemed to be in legal custody. ", "(4) The Governor-General may release on licence any person detained under subsection (1) or (3) of this section. Such licence shall be in such form and contain such conditions as the Governor-General may direct, and may at any time be revoked or varied by the Governor-General. Where such licence is revoked the person to whom it relates shall return forthwith to such place as the Governor-General may direct, and if he fails to do so may be arrested by any constable without warrant and taken to such place.\" [4] Section 29 as originally enacted was amended in 1964 to substitute \"Minister\" for \"Governor\" in subsection (1) and \"Governor General\" for \"Governor\" in each of the four references originally made to the Governor in subsection (4). In 1975 subsection (1) was further amended to make plain, reversing the effect of v The Queen, AC 774, 3 All ER 55, that the statutory prohibition on pronouncement of the death sentence applied to those appearing to be aged under 18 at the time when they had committed the offence, not at the time of sentence. In 1985, the reference to \"an adult correctional centre\" was substituted for the previous reference to \"a prison\". The enacted reference to \"Her Majesty's pleasure\" has not, however, been amended, no doubt because section 68(2) of the Constitution of Jamaica provides that the executive authority of Jamaica may be exercised on behalf of Her Majesty by the Governor-General. In recognition of this constitutional reality, it appears to be the practice where section 29(1) applies, as was done in this case, to call the sentence one of detention during the Governor-General's pleasure, and in this opinion that usage will be adopted. ", "2 xxx xxx xxx 3 The Constitution 4 xxx xxx xxx ", "5 The first question: is section 29 compatible with the Constitution of Jamaica? ", "[11] Both the Director and the Solicitor-General, who appeared with him, accepted at the hearing that, subject to their argument based on section 26(8) of the Constitution, section 29 of the Juveniles Act 1951 infringes the rights guaranteed by, and so is inconsistent with, sections 15(1)(b) and 20(1) of the Constitution. Given this concession, rightly made, it is unnecessary to do more than note the reason for it. A person detained during the Governor-General's pleasure is deprived of his personal liberty not in execution of the sentence or order of a court but at the discretion of the executive. Such a person is not afforded a fair hearing by an independent and impartial court, because the sentencing of a criminal defendant is part of the hearing and in cases such as the present sentence is effectively passed by the executive and not by a court independent of the executive. ", "6 xxx xxx xxx [13] \u2026..It does indeed appear that the sentencing provisions under challenge in the case were held to be unconstitutional not because of their repugnancy to any of the rights guaranteed by sections in Chapter III of the Constitution but because of their incompatibility with a principle on which the Constitution itself was held to be founded. There appears to be no reason why (subject to the other arguments considered below) the reasoning in the case does not apply to the present case. It would no doubt be open to the G> to reject that reasoning, but it would be reluctant to depart from a decision which has stood unchallenged for 25 years, the more so since the decision gives effect to a very important and salutary principle. Whatever overlap there may be under constitutions on the G> model between the exercise of executive and legislative powers, the separation between the exercise of judicial powers on the one hand and legislative and executive powers on the other is total or effectively so. Such separation, based on the rule of law, was recently described by Lord as \"a characteristic feature of democracies\": () v Secretary of for , [2002] 4 All E 1089, [2002] 3 WL 1800, at pp. 1821-1822, para 5 of the latter report. In the opinion of the G>, Mr has made good his challenge to section 29 based on its incompatibility with the constitutional principle that judicial functions (such as sentencing) must be exercised by the judiciary and not by the executive. ", "7 xxx xxx xxx \u2026..The nature and purpose of the sentence of detention during the Governor-General's pleasure are clear, as explained above. The only question is who should decide on the measure of punishment the detainee should suffer. Since the vice of section 29 is to entrust this decision to the executive instead of the judiciary, the necessary modification to ensure conformity with the Constitution is (as in v The Queen, 1 AC 45) to substitute \"the court's\" for \"Her Majesty's\" in subsection (1) and \"the court\" for each reference to \"the Governor-General\" in subsection (4).\u201d ", "(iv) Our attention was also invited to v. , (1995) 183 CLR 245. The instant judgment was rendered by . The factual controversy which led to the above determination is being narrated first. The plaintiff was engaged as an officer of . The third defendant was also an officer of the said . The plaintiff and the third defendant continued to serve the until the itself ceased to exist. On 13.3.1990, lodged a complaint with the , wherein he alleged, verbal abuse and threatening behaviour on the part of , while both were in the employment of the . Thereafter, issued a notice under Section 24 of the Racial Discrimination Act, 1975. And accordingly, the er referred the complaint to the . The power of the , to hold an enquiry under the Racial Discrimination Act, 1975 against , was exercised by the second defendant. The second defendant had been appointed under Section 24 of the Racial Discrimination Act, 1975, which empowered the Minister, to appoint a person to perform and discharge the functions of the er. The second defendant returned his findings under Section 25Z of the Racial Discrimination Act, 1975 on 22.12.1993. The defendant\u2019s complaint was found to be substantiated. In disposing of the controversy, the second defendant required , the plaintiff, to do the following acts/course of conduct:- \"(1) that the Plaintiff do apologise to the Third Defendant, the form of the apology being annexed to the determination; ", "(2) that the Plaintiff do pay the sum of $2 500 to the Third Defendant by way of damages for the pain, humiliation, distress and loss of personal dignity suffered by the Third Defendant; ", "(3) that do take disciplinary action against the Plaintiff, in relation to the conduct which he perpetrated against the Third Defendant; (4) that do apologise to the Third Defendant in relation to the handling of his complaint, the form of the apology being annexed to the determination; ", "(5) that do pay the sum of $10 000 to the Third Defendant by way of damages for the pain, humiliation, distress and loss of personal dignity suffered by the Third Defendant.\" ", "In order to contest the determination rendered by the second defendant, raised a challenge to the provisions of the Racial Discrimination Act, 1975. The challenge raised by him came to be formulated in the following words:- ", "\"In consequence of the amendments embodied in the Sex Discrimination and other Legislation Amendment Act 1992 and/or the Law and Justice Legislation Amendment Act 1993 as they affect the Racial Discrimination Act 1975 are any, and if so which, of the provisions of Part III of the Racial Discrimination Act invalid?\" ", "While adjudicating upon the matter, held as under:- ", "\u201cThe plaintiff's challenge to the Act- ", "15. The plaintiff's challenge to particular provisions of the Act is based upon the proposition that they provide for an exercise of judicial power otherwise than in conformity with Ch.III of the Commonwealth Constitution in that the power is exercised by the which is not a court established pursuant to s.71 and constituted in accordance with s.72 of the Constitution. The plaintiff further argues that the correctness of this proposition is not affected by the provisions for review by . ", "8 xxx xxx xxx ", "21. Although many decision-making functions may take their character as an exercise of judicial, executive or legislative power from their legislative setting, the character of the decision-maker and the nature of the decision- making process, some decision-making functions are exclusive and inalienable exercises of judicial power (34 Reg. v. (1954) 90 CLR at 368-370 per and ). As and observed in Reg. v. (35 ibid. at 369) : ", "\"The truth is that the ascertainment of existing rights by the judicial determination of issues of fact or law falls exclusively within judicial power so that the cannot confide the function to any person or body but a court constituted under ss.71 and 72 of the Constitution\". In that statement, the expression \"judicial determination\" means an authoritative determination by means of the judicial method, that is, an enforceable decision reached by applying the relevant principles of law to the facts as found. ", "xxx xxx xxx ", "25. Turning to the case before the , whatever might be the enforceability of a declaration that the plaintiff \"do apologise\", a declaration that the plaintiff \"do pay the sum of $2 500\" to the third defendant, once registered, attracts the operation of s.53 of the Federal of Australia Act 1976 (Cth). By that section, a person in whose favour a judgment is given is entitled to the same remedies for enforcement, by execution or otherwise, as are allowed by the laws of the State or Territory applicable. In the present case, this means New South Wales. Section 53 does not affect the operation of any provision made by or under any other Act or the Rules of for the execution and enforcement of judgments of the (40 s.53(2)) . ", "26. But s.25ZAB goes beyond providing the machinery for the enforcement of a determination. It purports to give a registered determination effect \"as if it were an order made by \". A judicial order made by takes effect as an exercise of Commonwealth judicial power, but a determination by the is neither made nor registered in the exercise of judicial power. An exercise of executive power by the and the performance of an administrative function by the Registrar of simply cannot create an order which takes effect as an exercise of judicial power; conversely, an order which takes effect as an exercise of judicial power cannot be made except after the making of a judicial determination. Thus, s.25ZAB purports to prescribe what the Constitution does not permit.\u201d ", "(v) Our attention was then invited to Reference Re Residential Tenancies Act, 123 DLR (3d) 554. The factual matrix, in furtherance of which the above judgment was rendered by , is as follows. The provisions of the Residential Tenancies Act, 1979 (Ontario), by which was empowered to order eviction of tenants, as also, could require landlords and tenants to comply with the obligations imposed under the said Act, were assailed, as offending against the limitation contained in Section 96 of the British North America Act, 1867, and therefore, ultra vires. In recording its conclusions on a similar analogy, as in the judgments noticed above, observed as under:- ", "\u201cUnder s. 92(14) of the British North America Act, 1867, the provincial Legislatures have the legislative power in relation to the administration of justice in the Province. This is a wide power but subject to subtraction of ss. 96 to 100 in favour of the federal authority. Under s. 96 the Governor General has the sole power to appoint the judges of the Courts in each Province. Under s. 97 the Judges who are to be appointed to the Courts are to be selected from the respective bars of each Province. Under s. 100 is obliged to fix and provide for their salaries. Section 92(14) and ss. 96 to 100 represent one of the important compromises of the Fathers of Confederation. It is plain that what was sought to be achieved through this compromise, and the intended effect of s. 96 , would be destroyed if a Province could pass legislation creating a tribunal, appoint members thereto, and then confer on the tribunal the jurisdiction of . What was conceived as a strong constitutional base for national unity, through a unitary judicial system, would be gravely undermined. Section 96 has thus come to be regarded as limiting provincial competence to make appointments to a tribunal exercising s. 96 judicial powers and therefore as implicitly limiting provincial competence to endow a provincial tribunal with such powers. ", "IV The belief that any function which in 1867 had been vested in a s. 96 Court must forever remain in that Court reached its apogee in the judgment of Lord in v. ., (1938) 1 DLR 593, (1938) AC 415, (1938) 1 WWR 452. Describing s. 96 as one of the \u201cthree principal pillars in the temple of justice\u2026 not to be undermined\u201d, Lord held that could not validly receive \u201cjudicial authority\u201d. At the same time, he held that was in \u2018pith and substance\u2019 an administrative body, and the impugned \u2018judicial functions\u2019 were severable from the administrative powers given to the under its enabling legislation. There was no analysis of the inter-relationship between the judicial and administrative features of the legislative scheme; the assumption was that any attempt to confer a s. 96 function on a provincially-appointed tribunal was ultra vires the . ", "This sweeping interpretation of s. 96 , with its accompanying restrictive view of provincial legislative authority under s. 92 , was limited almost immediately by the judgment of this in the Reference re Adoption Act and Other Act , etc., (1938) 3 DLR 497, 71 CCC 110, (1938) SCR 398. Chief Justice held that the jurisdiction of inferior s was not \u201cfixed forever as it stood at the date of Confederation\u201d. On his view, it was quite possible to remove jurisdiction from and vest it in a of summary jurisdiction. The question which must be asked was whether \u201cthe jurisdiction conferred upon Magistrates under these statutes broadly conforms to a type of jurisdiction generally exercisable by s of summary jurisdiction rather than the jurisdiction of s within the purview of s. 96 \u201d (p. 514). In the Adoption Reference, C.J. looked to the historical practice in England and concluded that the jurisdiction conferred on Magistrates under the legislation before was analogous to the jurisdiction under the English Poor Laws, a jurisdiction which had belonged to courts of summary nature rather than to . On this basis, the legislation was upheld. The Adoption Reference represented a liberalization of the view of s. 96 adopted by in Toronto v. , at least in the context of a transfer of jurisdiction from to an inferior . ", "The same process of liberalization, this time in the context of a transfer of jurisdiction from to an administrative tribunal, was initiated by in v. , (1948) 4 DLR 673, (1949) AC 134, (1948) 2 WWR 1055. Lord proposed a two-fold test. The first limb of the test is to ask whether the board or tribunal exercises \u201cjudicial power\u201d. Lord did not propose a \u2018final\u2019 answer to the definition of \u201cjudicial power\u201d, but he suggested at p. 680 DLR, p. 149 AC, that: ", "\u201c\u2026the conception of the judicial function is inseparably bound up with the idea of a suit between parties, whether between and subject or between subject and subject, and that it is the duty of the to decide the issue between those parties, with whom alone it rests to initiate or defend or compromise the proceedings.\u201d If the answer to the initial question as to \u201cjudicial power\u201d is in the negative, then that concludes the matter in favour of the provincial board. If, however, the power is in fact a judicial power, then it becomes necessary to ask a second question: in the exercise of that power, is the tribunal analogous to a Superior, County ? ", "xxx xxx xxx Step two involves consideration of the function within its institutional setting to determine whether the function itself is different when viewed in that setting. In particular, can the function still be considered to be a \u2018judicial\u2019 function? In addressing the issue, it is important to keep in mind the further statement by in v. (at p. 424 DLR, p. 543 SCR) that \u201c\u2026it is the subject-matter rather than the apparatus of adjudication that is determinative\u201d. Thus the question of whether any particular function is \u2018judicial\u2019 is not to be determined simply on the basis of procedural trappings. The primary issue is the nature of the question which the tribunal is called upon to decide. Where the tribunal is faced with a private dispute between parties, and is called upon to adjudicate through the application of a recognized body of rules in a manner consistent with fairness and impartiality, then, normally, it is acting in a \u2018judicial capacity\u2019. To borrow the terminology of Professor , the judicial task involves questions of \u2018principle\u2019, that is, consideration of the competing rights of individuals or groups. This can be contrasted with questions of \u2018policy\u2019 involving competing views of the collective good of the community as a whole. (See , Taking Rights Seriously (1977) at pp. 82-90 ().\u201d A perusal of the conclusions recorded by reveals, that the court evolved a three step test to determine the constitutional validity of a provision which vested adjudicatory functions in an administrative tribunal. The first step was determined in the light of the historical conditions existing in 1867, i.e. before the British North America Act, 1867 was enacted. The first step required a determination whether at the time of Confederation, the power or jurisdiction now vested in an administrative tribunal, was exercised through a judicial court process. If the answer to the first step was in the negative, the constitution of the administrative tribunal would be valid. If historical evidence indicated, that the power, now vested with an administrative tribunal, was identical or analogous to a power exercised under Section 96 s at Confederation, then the matter needed to be examined further. The second step was to determine, whether the power to be exercised by the administrative tribunal, should be considered as a judicial function. Insofar as the instant aspect of the matter is concerned, it was illustratively concluded, that where power vested in the administrative tribunal was in respect of adjudication of disputes between the parties, which required to be settled through an application of a recognized body of rules, in a manner consistent with fairness and impartiality, then the said power could be classified as judicial power/function. If, however, while applying the second step, the answer was in the negative, it was not necessary to proceed with the matter further, and the vesting of the power with the administrative tribunal should be considered as valid. If the power or jurisdiction is exercised in a judicial manner, then it is imperative to proceed to the third and final step. The third step contemplates analysis and review of the administrative tribunal\u2019s functions as a whole, and to examine the same in its entire institutional context. It contemplated an examination of the inter-relationship between the administrative tribunal\u2019s judicial powers, and the other powers and jurisdiction conferred by the legislative enactment. If a judicial hearing is a must, whereafter a judgment was required to be rendered, the administrative tribunal would be deemed to be exercising jurisdiction which is ordinarily vested in a . It is after recording a finding in the affirmative on all the three steps, that it will be possible to conclude, whether judicial functions have been required to be exercised by the concerned administrative tribunal. Having examined the controversy in Reference Re Residential Tenancies Act (supra), arrived at the conclusion, that could have been authorized to grant orders for possession to a landlord or to grant orders for specific performance of a tenancy. ", "23. Finally, learned counsel for the petitioners placed reliance on \u201cConstitutional Law of Canada\u201d, by (third edition, 1992, by ) in order to assert, that even under Constitutions where the separation of power rule has not been explicitly provided for, there would be limitations in delegation of functions to tribunals. Relevant text on the subject, from the above treatise is being reproduced hereunder:- ", "\u201c7.3 Implications of Constitution\u2019s judicature sections Separation of powers There is no general \u201cseparation of powers\u201d in the Constitution Act , 1867. The Act does not separate the legislative, executive and judicial functions and insist that each branch of government exercise only \u201cits own\u201d function. As between the legislative and executive branches, any separation of powers would make little sense in a system of responsible government; and it is clearly established that the Act does not call for any such separation. As between the judicial and the two political branches, there is likewise no general separation of powers. Either the or the may by appropriate legislation confer non- judicial functions on the courts and (with one important exception, to be discussed) may confer judicial functions on bodies that are not courts. ", "Each Canadian jurisdiction has conferred non-judicial functions on its courts, by enacting a statute which enables the government to refer a question of law to the courts for an advisory opinion. The rendering of advisory opinions to government is traditionally an \u201cexecutive\u201d function, performed by the law officers of the government. For that reason, the supreme Court of the United States and have refused to render advisory opinions, reasoning that a separation of powers doctrine in their Constitutions confines the courts to the traditional judicial function of adjudicating upon genuine controversies. But in the Reference Appeal (1912), (Reference Appeal) (1912) AC 571, refused to read any such limitation into Canada\u2019s Constitution. Their lordships upheld the federal reference statute, apparently as a law in relation to the supreme court of Canada (s.101). The provincial reference statutes are also valid as laws in relation to the administration of justice in the province (s.92(14)). ", "The conferral of judicial functions on bodies which are not courts is likewise subject to no general prohibition. However, here there is an important qualification to be made. The courts have held that the provincial may not confer on a body other than a superior, district or county court judicial functions analogous to those performed by a superior, district or county court. This little separation of powers doctrine has been developed to preclude evasion of the stipulations of ss. 96 to 100 of the constitution Act, 1867. ", "If ss. 96 to 100 of the constitution Act, 1867 were read literally, they could easily be evaded by a province which wanted to assume control of its judicial appointments. The province could increase the jurisdiction of its inferior courts so that they assumed much of the jurisdiction of the higher courts; or the province could best higher-court jurisdiction in a newly-established tribunal, and call that tribunal an inferior court or an administrative tribunal. It is therefore not surprising that the courts have added a gloss to s. 96 and the associated constitutional provisions. What they have said is this: if a province invests a tribunal with a jurisdiction of a kind that ought property to belong to a superior, district or county court, then that tribunal, whatever its official name, is for constitutional purposes a superior, district or county court and must satisfy the requirements of s. 96 and the associated provisions of the constitution Act, 1867. This means that such a tribunal will be invalidly constituted, unless its members (1) are appointed by the federal government in conformity with s. 96 , (2) are drawn from the bar of the province in conformity with ss. 97 and 98 , and (3) receive salaries that are fixed and provided by the federal parliament in conformity with s. 100 . ", "So far the law is clear, and the policy underlying it is comprehensible. But the difficulty lies in the definition of those functions that ought properly to belong to a superior, district or county court. The courts have attempted to fashion a judicially enforceable rule which would separate \u201cs. 96 functions\u201d from other adjudicatory functions. The attempt has not been successful, and it is difficult to predict with confidence how the courts will characterize particular adjudicatory functions. The uncertainty of the law, with its risk of nullification, could be a serious deterrent to the conferral of new adjudicatory functions on inferior courts or administrative tribunals, and a consequent impediment to much new regulatory or social policy. For the most part, the courts have exercised restraint in reviewing the provincial statutes which create new adjudicatory jurisdictions, so that the difficulty has not been as serious as it could have been. However, in the last two decades, there has been a regrettable resurgence of s. 96 litigation: five challenges to the powers of inferior courts or tribunals based on s. 96 have succeeded in , A.G. Que. v. 2 S.C.R. 638; Re Residential Tenancies Act 1 S.C.R. 714; v. A.G. Que. 2 S.C.R. 220; Re B.C. Family Relations Act 1.S.C.R. 62; v. A.G.N.B. 1 S.C.R. 704. Since the abolition of appeals, two other challenges have also been successful, namely, A.G. Ont. v. S.C.R. 32; . S.C.R. 681, and these decisions have spawned many more challenges. These developments are described in the text that follows. ", "24. It was also the submission of the learned counsel for the petitioners, that the proposition of law highlighted hereinabove on the basis of the provisions of constitutions of different countries (Jamaica, Ceylon, Australia and Canada) decided either by or the highest courts of the concerned countries, is fully applicable to India as well. In order to demonstrate this, he placed reliance on \u2019 , . The controversy in the cited case originated with the filing of a writ petition by the respondent challenging the appointment of Assistant Commissioners of Labour (i.e., Officers discharging executive functions under ). The above appointments had been made, consequent upon amendments to the provisions of the Bombay Industrial Relations Act, and the Industrial Disputes (Maharashtra Amendment) Act. The submission advanced at the hands of the respondent was, that had been constituted in the State of Maharashtra, under the Industrial Disputes Act , the Bombay Industrial Relations Act, as also, the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices, Act. Qualifications of persons to be appointed as a judge of under the Industrial Disputes Act , was stipulated in Section 7 , which provided as under:- ", "\u201c(a) that he was or had been a Judge of a High Court; or ", "(b) that he had for a period of not less than three years been a District Judge or an Additional District Judge; or ", "(c) that he had held the office of the Chairman or any other Member of or of any for a period of not less than two years; or ", "(d) that he had held any judicial office in India for not less than seven years; or ", "(e) that he had been the Presiding Officer of constituted under any provincial Act for not less than five years.\u201d By the Industrial Disputes (Maharashtra Amendment) Act, 1974, Section 7 was amended, and three more sources of recruitment for the post of judge of were added. These were:- ", "\u201c(d-1) he has practiced as an advocate or attorney for not less than seven years in , or any court, subordinate thereto, or any or Tribunal or , constituted under any law for the time being in force; or (d-2) he holds a degree in law of a University established by law in any part of India and is holding or has held an office not lower in rank than that of a Deputy Registrar of any such or Tribunal for not less than five years; or (d-3) he holds a degree in law of University established by law in any part of India and is holding or has held an office not lower in rank than that of Assistant Commissioner of Labour under for not less than five years.\u201d Under the Bombay Industrial Relations Act, as it originally stood, Section 9 provided, that only such persons would be eligible for appointment as a judge of the , who possessed the qualifications laid down under Article 234 of the Constitution, for being eligible to enter judicial service in the State of Maharashtra. By the Maharashtra Act 47 of 1977, Section 9 of the Bombay Industrial Relations Act was amended by substituting a new sub-section (2), which replaced the original sub-section (2) of Section 9 . The amended sub-section (2) was as follows:- ", "\u201c9. (2) A person shall not be qualified for appointment as the presiding officer of , unless: ", "(a) he has held any judicial office in India for not less than five years; or ", "(b) he has practiced as an Advocate or Attorney for not less than seven years in or any court subordinate thereto, or in any , or constituted under any law for the time being in force; or ", "(c) he holds a degree in law of a University established by law in any part of India and is holding or has held an office not lower in rank than that of Deputy Registrar of any such or , or of Assistant Commissioner of Labour under , in both cases for not less than five years.\u201d In the first instance, this for the first time declared the salient components of the functions exercised by a civil court , as under:- \u201c6. In the case of , AIR 1950 SC 188, this considered whether was a court. It said that one cannot go by mere nomenclature. One has to examine the functions of a and how it proceeds to discharge those functions. It held that had all the trappings of a court and performed functions which cannot but be regarded as judicial. The referred to the Rules by which proceedings before the were regulated. The dwelt on the fact that the powers vested in it are similar to those exercised by civil courts under the Code of Civil Procedure when trying a suit. It had the power of ordering discovery, inspection etc. and forcing the attendance of witnesses, compelling production of documents and so on. It gave its decision on the basis of evidence and in accordance with law. Applying the test laid down in the case of v. , (1937) 2 K.B. 309 at p.340, this said that \"a true judicial decision presupposes an existence of dispute between two or more parties and then involves four requisites - (1) the presentation of their case by the parties; (2) ascertainment of facts by means of evidence adduced by the parties often with the assistance of argument; (3) if the dispute relates to a question of law, submission of legal arguments by the parties; and (4) by decision which disposes of the whole matter by findings on fact and application of law to facts so found. Judged by the same tests, a Labour would undoubtedly be a court in the true sense of the term. The question, however, is whether such a court and the presiding officer of such a court can be said to hold a post in the judicial service of the as defined in Article 236 of the Constitution.\u201d The other relevant observations recorded in the above cited judgment are reproduced below:- ", "\u201c13. Reliance has been placed upon this judgment as showing that judicial service is interpreted narrowly to cover only the hierarchy of civil courts headed by the District Judge. This Court, however, was not considering the position of other civil courts, in the context of the extensive definition given to the term \"district judge\". This Court was concerned with preserving independence of the judiciary from the executive and making sure that persons from non-judicial services, such as, the police, excise or revenue were not considered as eligible for appointment as District Judges. That is why the emphasis is on the fact that the judicial service should consist exclusively of judicial officers. This judgment should not be interpreted narrowly to exclude from judicial service new hierarchies of civil courts being set up which are headed by a judge who can be considered as a District Judge bearing in mind the extensive definition of that term in Article 236. ", "14. has, therefore, correctly interpreted the observations of this in ., AIR 1966 SC 1987, as giving paramount importance to the enforcement of the constitutional scheme providing for independence of the judiciary. The concern of the court was to see that this independence was not destroyed by an indirect method. ", "xxx xxx xxx ", "18. In the case of ., , this Court had to consider qualifications for the purpose of appointment as a Judge of under Article 217 of the Constitution. While interpreting the expression \"judicial office\" under Article 217(2)(a ), this Court held that the expression \"judicial office\" must be interpreted in consonance with the scheme of Chapters V and VI of Part VI of the Constitution. So construed it means a judicial office which belongs to the judicial service as defined under Article 236(b). Therefore, in order to qualify for appointment as a judge of , a person must hold a judicial office which must be a part of the judicial service of the . After referring to the cases of (supra) and , AIR 1968 SC 1495, this Court said that the term \"judicial office\" in its generic sense may include a wide variety of offices which are connected with the administration of justice in one way or the other. Officers holding various posts under the executive are often vested with magisterial power to meet a particular situation. The Court said, \"Did the framers of the Constitution have this type of \u2018offices\u2019 in mind when they provided a source of appointment to the high office, of a judge of from amongst the holders of a \u2018judicial office\u2019? The answer, has to be in the negative. We are of the view that holder of judicial office under Article 217(2)(a) means the person who exercises only judicial functions, determines causes inter-parties and renders decisions in a judicial capacity. He must belong to the judicial service which as a class is free from executive control and is disciplined to uphold the dignity, integrity and independence of the judiciary.\" ", "Going by these tests laid down as to what constitutes judicial service under Article 236 of the Constitution, the judges and the judges of can be held to belong to judicial service. The hierarchy contemplated in the case of judges is the hierarchy of judges and judges with judges holding the superior position of District Judges. The s have also been held as subject to power of superintendence under Article 227. ", "xxx xxx xxx ", "20. The constitutional scheme under Chapter V of Part VI dealing with and Chapter VI of Part VI dealing with the subordinate courts shows a clear anxiety on the part of the framers of the Constitution to preserve and promote independence of the judiciary from the executive. Thus Article 233 which deals with appointment of District Judges requires that such appointments shall be made by the Governor of the in consultation with . Article 233(2) has been interpreted as prescribing that \"a person in the service of the or the \" can refer only to a person in the judicial service of the or the . Article 234 which deals with recruitment of persons other than District Judges to the judicial service requires that their appointments can be made only in accordance with the Rules framed by the Governor of the after consultation with the Public Service Commission and with . Article 235 provides that the control over district courts and courts subordinate thereto shall be vested in ; and Article 236 defines the expression \"District Judge\" extensively as covering judges of etc. as earlier set out, and the expression \"judicial service\" as meaning a service consisting exclusively of persons intended to fill the post of the District Judge and other civil judicial posts inferior to the post of District Judge. Therefore, bearing in mind the principle of separation of powers and independence of the judiciary, judicial service contemplates a service exclusively of judicial posts in which there will be a hierarchy headed by a District Judge. has rightly come to the conclusion that the persons presiding over would constitute a judicial service so defined. Therefore, the recruitment of judges is required to be made in accordance with Article 234 of the Constitution.\u201d ", "25. According to the learned counsel for the petitioners, the judgments and text cited hereinabove, are fully applicable on the subject of administration of justice through courts in India. Insofar as the instant aspect of the matter is concerned, learned counsel placed reliance on Article 50 of the Constitution, which is reproduced hereunder:- \u201c50. Separation of judiciary from executive - The shall take steps to separate the judiciary from the executive in the public services of the .\u201d Based on Article 50 aforementioned, it was the contention of the learned counsel for the petitioners, that the Constitution itself mandates a separate judicial hierarchy of courts distinct from the executive. ", "26. Coupled with the above mandate, it was the contention of the learned counsel for the petitioners, that the provisions of the Income Tax Act , the Customs Act , and the Excise Act prior to independence of this country, and even thereafter, vested with an exclusive jurisdiction to settle \u201cquestions of law\u201d emerging out of tax disputes. It was further contended, that even after the enforcement of the Constitution, with effect from 26.11.1949, the adjudicatory power to decide substantial questions of law, continued to be vested in , inasmuch as, the jurisdictional continued to exercise appellate jurisdiction. The position has remained unaltered till date. It is, therefore, the contention of the learned counsel for the petitioners, that historically, constitutionally and legally, the appellate jurisdiction in direct/indirect tax matters, has remained with , and it is not permissible either by way of an amendment to the Constitution itself, or by enacting a legislation, to transfer the said appellate jurisdiction exercised by to a quasi-judicial tribunal. ", "The third contention: ", "27. In the course of the submissions advanced by the learned counsel for the petitioners on the third contention, wherein it was sought to be submitted, that \u201cseparation of powers\u201d, the \u201crule of law\u201d and \u201cjudicial review\u201d constitute amongst others, the \u201cbasic structure\u201d of the Constitution, it was submitted, that Article 323B inserted by the Constitution (Forty-second Amendment) Act, 1976 was violative of the above mentioned components of the basic structure of the Constitution. Article 323B is being extracted hereunder:- ", "\"323B. Tribunals for other matters - (1) The appropriate may, by law, provide for the adjudication or trial by tribunals of any disputes, complaints, or offences with respect to all or any of the matters specified in clause (2) with respect to which such has power to make laws. ", "(2) The matters referred to in clause (1) are the following, namely:- ", "(a) levy, assessment, collection and enforcement of any tax; ", "(b) foreign exchange, import and export across customs frontiers; ", "(c) industrial and labour disputes; ", "(d) land reforms by way of acquisition by the of any estate as defined in article 31A or of any rights therein or the extinguishment or modification of any such rights or by way of ceiling on agricultural land or in any other way; ", "(e) ceiling on urban property; ", "(f) elections to either or the or either of the Legislature of a State, but excluding the matters referred to in article 329 and article 329A; ", "(g) production, procurement, supply and distribution of foodstuffs (including edible oilseeds and oils) and such other goods as the President may, by public notification, declare to be essential goods for the purpose of this article and control of prices of such goods; ", "(h) rent, its regulation and control and tenancy issues including the rights, title and interest of landlords and tenants; ", "(i) offences against laws with respect to any of the matters specified in sub-clauses (a) to (h) and fees in respect of any of those matters; ", "(j) any matter incidental to any of the matters specified in sub-clauses ", "(a) to (i). ", "(3) A law made under clause (1) may- ", "(a) provide for the establishment of a hierarchy of tribunals; ", "(b) specify the jurisdiction, powers (including the power to punish for contempt) and authority which may be exercised by each of the said tribunals; ", "(c) provide for the procedure (including provisions as to limitation and rules of evidence) to be followed by the said tribunals; ", "(d) exclude the jurisdiction of all courts except the jurisdiction of under article 136 , with respect to all or any of the matters falling within the jurisdiction of the said tribunals; ", "(e) provide for the transfer to each such tribunal of any cases pending before any court or any other authority immediately before the establishment of such tribunal as would have been within the jurisdiction of such tribunal if the causes of action on which such suits or proceedings are based had arisen after such establishment; ", "(f) contain such supplemental, incidental and consequential provisions (including provisions as to fees) as the appropriate may deem necessary for the effective functioning of, and for the speedy disposal of cases by, and the enforcement of the orders of, such tribunals. (4) The provisions of this article shall have effect notwithstanding anything in any other provision of this Constitution or in any other law for the time being in force. ", "Explanation.\u2014In this article, \u201cappropriate \u201d, in relation to any matter, means or, as the case may be, a State competent to make laws with respect to such matter in accordance with the provisions of Part XI.\u201d Insofar as the aforesaid provision is concerned it was submitted, that Clause (3) of Article 323B clearly violated all the above mentioned ingredients of the \u201cbasic structure\u201d theory. In this behalf it was sought to be asserted, that establishment of a hierarchy of tribunals implicitly led to the inference, that the existing judicial process, where adjudication was before a court of law, was to be substituted in its entirety. Thereby, even the existing appellate process which was vested in was sought to be substituted by tribunals. It was submitted, that creation of a parallel judicial system, was alien to the provisions of the Constitution, which recognized the judiciary as an independent component, separate from the executive and the legislature. It was accordingly vehemently asserted, that the process of justice was being substituted, by tribunalization of justice, which was clearly unacceptable under the Constitution. Sub-clause (d) of Article 323B(3 ), according to the learned counsel for the petitioners, divested jurisdiction vested in all civil courts for the adjudication of the matters on the subjects referred to in Article 323B(2 ), including not only the appellate jurisdiction of , but also, the power of \u201cjudicial review\u201d vested in under Articles 226 and 227, of the Constitution. It was also the contention of the learned counsel for the petitioners, that despite decisions rendered by this Court, the legislature has repeated and reiterated what had been found to be unsustainable in law. ", "28. While canvassing the aforesaid contention learned counsel for the petitioners pointed out, that the above mentioned Article 323B was introduced by the Constitution (Forty-second Amendment) Act, 1976, which was part of an overall scheme, to drastically curtail the power of \u201cjudicial review\u201d vested with the higher judiciary. It was pointed out, that all other objectionable provisions were deleted, and powers earlier vested in superior courts were restored. However, Part XIV A of the Constitution, inserting Articles 323A and 323B was allowed to remain. It was submitted that Articles 323A and 323B, enabled the creation of parallel judiciary under executive control. In order to support his aforestated contention, learned counsel invited the \u2019s attention to the expressions \u201cadjudication or trial\u201d, \u201cdisputes, complaints or offences\u201d, \u201ctransfer of suits or proceedings\u201d, etc. which could be fashioned in a manner different from that which presently prevailed. It was pointed out, that the aforestated mandate contained in Article 323B of the Constitution, was incompatible with the \u201cbasic structure\u201d of the Constitution, which mandates \u201cseparation of powers\u201d. ", "29. In view of the aforementioned submissions, it was the vehement contention of the learned counsel for the petitioners, that Article 323B(4) should be struck down. It was submitted, that if the instant prayer of the petitioners does not find favour with this , the alternative prayer of the petitioners was, that Article 323B must be purposefully interpreted, so as to bestow equivalence commensurate to the sought to be substituted by the tribunal. It was submitted, that it was imperative to provide for measures to ensure independence in the functioning of tribunals substituting functions carried out by courts. This could be done, according to learned counsel for the petitioners, by extending the conditions of service applicable to judges of the court sought to be substituted. In order to support his aforestated contention, learned counsel for the petitioners placed reliance on judgments rendered by this , laying down the limits and parameters within which such tribunals could be created. Despite the declaration of law by this it was submitted, that the NTT Act, has been enacted, which suffers from the same vices, which had already been found to be unconstitutional. For reasons of brevity, it is considered inappropriate, to refer to all the judgments relied upon by the rival parties on the instant issue. Suffice it to state, that the same will be examined, only while recording conclusions. ", "The fourth contention: ", "30. While advancing the fourth contention, learned counsel for the petitioners referred to various provisions of the Act, which would have the effect of compromising the independence of the . We may briefly refer to the provisions of the said Act, highlighted by the learned counsel for the petitioners, during the course of hearing, as under:- ", "(i) First and foremost, reference was made to Section 5 of the NTT Act. The same is being extracted hereunder:- ", "\u201c5. Constitution and jurisdiction of Benches- (1) the jurisdiction of may be exercised by the Benches thereof to be constituted by the Chairperson. ", "(2) The Benches of shall ordinarily sit at any place in the National Capital Territory of Delhi or such other places as the Central Government may, in consultation with the Chairperson, notify: ", "Provided that the Chairperson may for adequate reasons permit a Bench to hold its temporary sitting for a period not exceeding fifteen days at a place other than its ordinary place of seat. ", "(3) shall notify the areas in relation to which each bench of may exercise its jurisdiction. ", "(4) The Central Government shall determine the number of Benches and each Bench shall consist of two members. ", "(5) The Central Government may transfer a Member from headquarters of one Bench in one State to the headquarters of another Bench in another State or to the headquarters of any other Bench within a State: ", "Provided that no member shall be transferred without the concurrence of the Chairperson.\u201d Referring to sub-section (2) of Section 5 it was sought to be asserted, that benches of the are ordinarily to function in the National Capital Territory of Delhi. This, according to the learned counsel for the petitioners, would deprive the litigating assessee, the convenience of approaching of the State to which he belongs. In this behalf it was sought to be asserted, that in every tax related dispute, there is an asseessee on one side, and the on the other. Accordingly, if the is mandated to sit ordinarily in the National Capital Territory of Delhi, assessees from far flung States would have to suffer extreme hardship for the redressal of their grievance, especially at the appellate stage. Besides the hardships, it was pointed out, that each asseessee would be subjected to unfathomable financial expense. Referring to sub-section (5) of Section 5 of the Act, it was the submission of the learned counsel for the petitioners, that was vested with the power to transfer a Member from the headquarters of one bench in one State, to the headquarters of another bench in another State. It was also open to to transfer a Member from one bench to another bench in the same State. It was submitted, that in case of , such power is exercised exclusively by the Chief Justice, in the best interest of the administration of justice. It was submitted, that , which is a stakeholder, could exercise the above power of transfer for harassment and exploitation of sitting Members of the . In other words, an inconvenient Member could be moved away, and replaced by one who would tow the desired line. ", "(ii) Likewise, learned counsel for the petitioners referred to Section 6 of the NTT Act to demonstrate, that the same would also have an undermining effect on the adjudicatory process. Section 6 of the NTT Act is reproduced hereunder:- ", "\u201c6. Qualifications for appointment of Chairperson and other Members \u2013 (1) The Chairperson of shall be a person who has been a Judge of or the Chief Justice of . ", "(2) A person shall not be qualified for appointment as Member unless he- ", "(a) is, or has been, or is eligible to be, a Judge of ; or ", "(b) is, or has been, a Member of or of for at least five years.\u201d Learned counsel for the petitioners pointed out, that sub-section (2), aforementioned, laid down the qualifications for appointment as Member of the . Referring to clause (a) of sub-section (2) of Section 6 of the Act it was submitted, that a person who is eligible to be a judge of , is to be treated as eligible as a member of the . Inviting our attention to Article 217 of the Constitution it was submitted, that a person who is a citizen of India and has, for at least 10 years, practiced as an Advocate before one or the other , has been treated as eligible for being appointed as a Member of the . Referring to Section 8 of the Act it was pointed out, that a Member of the is provided with a tenure of five years, from the date of his appointment as Member of the . It was pointed out, that in terms of Article 217 of the Constitution, a person would easily become eligible for appointment as a judge at or around the age of 35-40 years, and as such, if he is assured a tenure of only five years, it would not be possible for him to discharge his duties without fear or favour, inasmuch as, he would always have a larking uncertainty in his mind about his future, after the expiry of the prescribed term of five years, in the event of not being granted an extension. Relying on clause (b) of Section 6(2) of the Act, it was also the submission of the learned counsel for the petitioners, that Members of constituted under the Income Tax Act , the Customs Act , and the Excise Act , are also eligible for being appointed as Members of the . In this behalf it was sought to be asserted, that there are Accountant Members of , who too would become eligible for appointment as Members of the . It was submitted, that judicial experience on the niceties of law, specially on the different aspects, which need to be dealt with while adjudicating tax matters, would be alien to them, inasmuch as they can only be experts on the subject of accountancy. It was pointed out, that the jurisdiction vested in the , is an alternative jurisdiction to that of the , and as such, it is difficult to appreciate how an Accountant Member of can be expected to discharge duties relating to settling substantial questions of law in the manner judges of the dispense with the aforesaid responsibilities. ", "(iii) Learned counsel for the petitioners then invited our attention to Section 7 of the NTT Act. The said section is reproduced hereunder:- ", "\u201c7. Appointment of Chairperson and other Members - (1) Subject to the provisions of sub-section (2), the Chairperson and every other Member shall be appointed by the Central Government. ", "(2) The Chairperson and the other Members shall be appointed by on the recommendations of a Selection Committee consisting of- ", "(a) the Chief Justice of India or a Judge of nominated by him; ", "(b) the Secretary in (); ", "(c) the Secretary in (). ", "(3) No appointment of the Chairperson or of any other Member shall be invalidated merely by reason of any vacancy or any defect in the constitution of .\u201d A perusal of sub-section (2) of Section 7 reveals the composition of the selection committee for selection of the Chairperson and Members of the . It was sought to be pointed out, that there were two representatives of the executive, out of three member selection committee, and only one member in the selection committee was from the judiciary. Accordingly it was asserted, that the two representatives belonging to the executive would control the outcome of every selection process. Since the was, an alternative to the jurisdiction earlier vested with , it was submitted, that the same process of selection, as was prevalent for appointment of judges of , should be adopted for selection of Chairperson and Members of the . All that is imperative and essential is, that the selection process should be the same, as is in place, for the court sought to be substituted. It was also the contention of the learned counsel for the petitioners, that a provision similar to Section 7(2) of the Act, had been struck down by this Court, in (supra). ", "(iv) Learned counsel for the petitioners then invited our attention to Section 8 of the NTT Act. Section 8 is being reproduced hereunder:- ", "\u201c8. Terms of office of Chairperson and other Members - The Chairperson and every other Member shall hold office as such for a term of five years from the date on which he enters upon his office but shall be eligible for re-appointment: ", "Provided that no Chairperson or other Member shall hold office as such after he has attained, - ", "(a) in the case of Chairperson, the age of sixty-eight years; and ", "(b) in the case of any other Member, the age of sixty-five years.\u201d According to learned counsel, a perusal of Section 8 reveals, that a Chairperson and a Member of the would hold office for a term of five years, from the date of his/her appointment to the . It was, however sought to be pointed out, that a person appointed as such, is clearly eligible for reappointment. It was sought to be asserted, that a provision for reappointment, would itself have the effect of undermining the independence of the Members of the . It was sought to be asserted, that each one of the appointees to the would be prompted to appease the , so as to solicit reappointment contemplated under Section 8 of the Act. In this behalf it was submitted, that the tenure of appointment to a tribunal, which is to substitute , should be akin to that of a judge of . ", "(v) Our attention was then invited to Section 13 of the NTT Act, which is reproduced hereunder:- ", "\u201c13. Appearance before - (1) A party to an appeal other than Government may either appear in person or authorize one or more chartered accountants or legal practitioners to present his or its case before the . ", "(2) The Government may authorize one or more legal practitioners or any of its officers to present its case before . ", "Explanation \u2013 For the purposes of this Section,- ", "(a) \u201cchartered accountant\u201d means a chartered accountant as defined in clause (b) of sub-section (1) of section 2 of the Chartered Accountants Act, 1949 and who has obtained a certificate of practice under sub-section (1) of section 6 of that Act; ", "(b) \u201clegal practitioner\u201d means an advocate, a vakil or any attorney of , and includes a pleader in practice.\u201d It was submitted, that besides allowing the assessee to represent himself before the , Section 13 allows him to be represented through one or more or legal practitioners. Thus far, according to learned counsel for the petitioners, there seemed to be no difficulty in Section 13(1) of the Act. However, allowing \u201cany person duly authorized\u201d by the assessee to represent him before the , is clearly ununderstandable. It was submitted, that the main function of the would be to settle substantial questions of law on tax issues, and as such, under Section 13(1) , it would be open to an assessee to engage an individual to represent him, even though he is totally unqualified in the fields on which the adjudicatory process is to be conducted. Likewise, it is the contention of the learned counsel for the petitioners, besides legal practitioners, the is allowed to be represented through any of its officers. It was sought to be asserted, that an understanding of the text of the provision is one thing, whereas interpreting it in the contemplated context, quite another. As such, it was submitted, that officers of the , who lack in interpretative skills, would be wholly unsuited for representing the before the . ", "Submissions in opposition, by the respondents/interveners: The first contention: ", "31. In response to the first contention, namely, that the reasons for setting up the were fallacious and non-existent, and as such, the legislative enactment under reference creating the as an independent appellate forum to decide appeals on \u201csubstantial questions\u201d of law, from orders passed by the Appellate Tribunals constituted under the Income Tax Act , the Customs Act , and the Excise Act deserves to be set aside; it was the contention of the learned counsel for the respondents, that the submissions advanced at the hands of the petitioners, were premised on an improper understanding of the factual background. In this behalf, it is sought to be asserted, that the tax receipts are the primary source of revenue in India. meets its budgetary requirements from revenue receipts. It is sought to be explained, that tax is collected by an established administrative and legal structure. On the one hand, while fastening of a tax liability would reduce the profits of an assessee, it would enhance the revenue receipts of the . On the other hand, exemption from a tax liability would increase profits of an assessee, but would reduce the revenue receipts of the . In view of the above profit and loss scenario, administration of tax loss, has an inherent tendency to result in disputes and litigation. The process of litigation is primarily based on adoption of innovative means of interpretation of law, both by the revenue and by the tax payers. As a result, significant amount of time is spent, on long drawn litigation, wherein tax payers and the lock horns against one another. Naturally, this impacts revenue earnings as levy of tax of thousands of crores of rupees, remains embroiled in such litigation. It was sought to be pointed out, that as per , Indian companies have a vast amount locked in disputed taxes. As per the above report, during the Financial Year 2011-2012; 30 companies that make up the sensex, had money locked in disputed taxes estimated at Rs.42,388 crores. The above disputed tax liability, according to the learned counsel for the respondents, was a 27% increase from the amount of the preceding year, which was estimated at Rs.33,339 crores. ", "32. In respect of disputes on direct taxes, it was submitted, that in a written reply submitted by the Minster of State for Finance, was informed in April, 2012, that 5,943 tax cases were pending with , and 30,213 direct tax cases were pending with . It was submitted that was additionally informed, that the disputed amount of tax, at various levels, was estimated at Rs.4,36,741 crores, as on 31.12.2011. It was further sought to be asserted, that in the preceding year, the estimate in respect of the disputed amount at various levels, was to the tune of Rs.2,43,603 crores. Accordingly it was sought to be pointed out, that with each succeeding year, not only the tax related litigation was being progressively enhanced, there was also a significant increase in the finance blocked in such matters. ", "33. It was likewise pointed out, that the number of cases involving levy of indirect taxes, projected a similar unfortunate reflection. In this behalf, it was sought to be pointed out, that as on 31.12.2012, the number of pending customs disputes were approximately 17,800, wherein an amount of approximately Rs.7,400 crores was involved. Insofar as the number of pending central excise cases as on 31.10.2012 is concerned, the figure was approximately 19,800 and the amount involved was approximately Rs.21,450 crores. By adding the figures reflected hereinabove, in respect of the disputes pertaining to indirect taxes, it was suggested that a total of about 37,600 cases were pending, involving an amount of approximately Rs.28,850 crores. Additionally it was submitted, that out of the 17,800 customs cases, approximately 6,300 cases had been pending for adjudication for periods ranging from one to three years, and approximately 2,800 customs cases had been pending adjudication for over three years. Likewise, out of the 19,800 central excise cases, 1,600 cases were pending for decision for a period between one to three years; and 240 cases had been pending for decision for over three years. ", "34. It was pointed out at the behest of the respondents, that several reasons contributed to the prolonged continuation of tax disputes. The main reason however was, that there was a lack of clarity in law in tax litigation. It was submitted, that the above lack of clarity resulted in multiple interpretations. Added to that, according to the learned counsel for the respondents, existence of multiple appellate levels, and independent jurisdictional , resulted in the existence of conflicting opinions at various appellate forums across the country, contributing in unfathomable delay and multiplicity of proceedings. ", "35. Based on the factors narrated above, it was the submission of the learned counsel for the respondents, that the burden of high volume of disputes had had the effect of straining the adjudicatory, as well as, the judicial system. It was pointed out, that the judicial system was already heavily burdened by the weight of significant number of unresolved cases. It was submitted, that the addition of cases each year, added not only to the inconvenience of the taxpayer, but also to the revenue earned by the government. It was pointed out, that the instant state of affairs created an uncertain and destabilized business environment, with taxpayers not being able to budget, for tax costs. Importantly such uncertainty, according to the learned counsel, emerged out of the two factors. Firstly, the law itself was complex, and therefore, uncertain. And secondly, for an interpretation of the law to achieve a degree of certainty at the level, required several rounds of litigation. It was submitted, that in view of the above, the current scenario called for reforms in the dispute resolution mechanism, and the introduction of, conscious practices and procedures, aimed at limiting the initiation, as well as, the prolongation of tax disputes. It is, therefore, the submission of the learned counsel for the respondents, that the assertions made at the hands of the petitioners, while projecting the first contention, were wholly misconceived, and as such, are liable to be rejected. The second contention: ", "36. In response to the second contention, namely, that it is impermissible for the legislature to abrogate the core judicial appellate functions, traditionally vested with , or that it is impermissible to vest the same with an independent, parallel quasi-judicial hierarchy of tribunals, it was submitted, that the petitioners had not been able to appreciate the matter in its correct perspective. It was pointed out, that the NTT Act is a legislation which creates an appellate forum, in a hierarchy of fora, as a remedy for ventilation of grievances emerging out of taxing statutes. To fully appreciate the purport of the special remedy created by the statute, the nature of the right and/or the liability created by the taxing statutes, and the enforcement for which these remedies have been provided, needed to be understood in the correct perspective. Accordingly, in order to debate the rightful cause, learned counsel drew our attention to the proposition, in the manner, as was understood by the respondents. The submissions advanced in this behalf are being summarized hereinafter. ", "37. It was the contention of the learned counsel for the respondents, that the Income Tax Act , the Customs Act , and the Excise Act , as also, other taxing statutes create a statutory liability. The said statutory liability has no existence, de hors the statute itself. The said statutory liability, has no existence in common law. It was further submitted, that it had been long well settled, that where a right to plead liability had no existence in common law, but was the creation of a statute, which simultaneously provided for a special and particular remedy for enforcing it, the remedy provided by the statute was bound to be followed. In respect of such statutory liability, it was not competent for the party to proceed, by action at common law. In this behalf, our attention was invited to the observations recorded by this Court in . (1968) 3 SCR 662 wherein the Court observed as under: \u201c9. The question that arises in these appeals has been before this Court in relation to other statutes and has been answered in different ways. These appeals went before a Divisional Bench of this Court but in view of the difficulty presented by the earlier rulings of this Court, they were referred to and that is how they are before us. At the very start we may observe that the jurisdiction of is all embracing except to the extent it is excluded by an express provision of law or by clear intendment arising from such law. This is the purport of Section 9 of the Code of Civil Procedure. How Section 9 operates is perhaps best illustrated by referring to the categories of cases, mentioned by ,J. in v. , 6 C.B. (NS) 336 - They are : ", "\"One is where there was a liability existing at common law, and that liability is affirmed by a statute which gives a special and peculiar form of remedy different from the remedy which existed at common law: there, unless the statute contains words which expressly or by necessary implication exclude the common law remedy the party suing has his election to pursue either that or the statutory remedy. The second class of cases is, where the statue gives the right to sue merely, but provides, no particular form of remedy: there, the party can only proceed by action at common law. But there is a third class, viz., where a liability not existing at common law is created by a statute which at the same time gives a special and particular remedy for enforcing it.........The remedy provided by the statute must be followed and it is not competent to the party to pursue the course applicable to cases of the second class.\" This view of , J. was accepted by in v. , [1919] A.C. 368. ", "xxx xxx xxx ", "35. Neither of the two cases of Firm of Illuri Subayya or can be said to run counter to the series of cases earlier noticed. The result of this inquiry into the diverse views expressed in this may be stated as follows :- ", "(1) Where the statute gives a finality to the orders of the special tribunals must be held to be excluded if there is adequate remedy to do what normally do in a suit. Such provision, however, does not exclude those cases where the provisions of the particular Act have not been complied with or the statutory tribunal has not acted in conformity with the fundamental principles of judicial procedure. ", "(2) Where there is an express bar of the jurisdiction of the court, an examination of the scheme of the particular Act to find the adequacy or the sufficiency of the remedies provided may be relevant but is not decisive to sustain the jurisdiction of the civil court. ", "Where there is no express exclusion the examination of the remedies and the scheme of the particular Act to find out the intendment becomes necessary and the result of the inquiry may be decisive. In the latter case it is necessary to see if the statute creates a special right or a liability and provides for the determination of the right or liability and further lays down that all questions about the said right and liability shall be determined by the tribunals so constituted, and whether remedies normally associated with actions in Civil Courts are prescribed by the said statue or not. ", "(3) Challenge to the provisions of the particular Act as ultra vires cannot be brought before constituted under that Act. Even the High Court cannot go into that question on a revision or reference from the decision of the . ", "(4) When a provision is already declared unconstitutional or the constitutionality of any provision is to be challenged, a suit is open. A writ of certiorari may include a direction for refund if the claim is clearly within the time prescribed by the Limitation Act but it is not a compulsory remedy to replace a suit. ", "(5) Where the particular Act contains no machinery for refund of tax collected in excess of constitutional limits or illegally collected a suit lies. ", "(6) Questions of the correctness of the assessment apart from its constitutionality are for the decision of the authorities and a civil suit does not lie if the orders of the authorities are declared to be final or there is an express prohibition in the particular Act. In either case the scheme of the particular Act must be examined because it is a relevant enquiry. ", "(7) An exclusion of the jurisdiction of is not readily to be inferred unless the conditions above set down apply.\u201d ", "38. In addition to the above submissions, it was sought to be asserted that the Income Tax Act expressly barred the jurisdiction of civil courts. Reference in this behalf was made to Section 293 of the Income Tax Act, which is being extracted hereunder: ", "\u201c293. Bar of suits in civil courts. \u2013 No suit shall be brought in any civil court to set aside or modify any proceeding taken or order made under this Act, and no prosecution, suit or other proceeding shall lie against the Government or any officer of the Government for anything in good faith done or intended to be done under this Act.\u201d ", "39. It has been further held by this following the dictum at v. (1897) AC 615, that if a statute confers a right and in the same breath provides for enforcement of such right the remedy provided by such a statute is an exclusive one. Applying this doctrine, in , at 513, this held as under: ", "\u201c23. To sum up, the principles applicable to the jurisdiction of in relation to an industrial dispute may be stated thus: (1) If the dispute is not an industrial dispute, nor does it relate to enforcement of any other right under the Act the remedy lies only in the civil Court. ", "(2) If the dispute is an industrial dispute arising out of a right or liability under the general or common law and not under the Act, the jurisdiction of the civil Court is alternative, leaving it to the election of the suitor concerned to choose his remedy for the relief which is competent to be granted in a particular remedy. ", "(3) If the industrial dispute relates to the enforcement of a right or an obligation created under the Act, then the only remedy available to the suitor is to get an adjudication under the Act. ", "(4) If the right which is sought to be enforced is a right created under the Act such as Chapter VA then the remedy for its enforcement is either Section 33C or the raising of an industrial dispute, as the case may be.\u201d In paragraph 12 of the case (supra), this quoted the words of Lord in v. (supra) to the following effect: ", "\u201cthe right and the remedy are given uno flatu and the one cannot be disassociated from the other\u201d ", "40. It is for this reason, according to learned counsel for the respondents, that civil courts, even the having original jurisdiction, would not entertain suits on matters covered by such special statutes creating rights and providing remedies. [See v. (1964) 1 All E.R. 791 at 796-H]. ", "\u201cThe principle underlying those passages seem to me to be applicable to the present case Section 341 of the Income Tax Act, 1952, confers the right, the right to an adjustment tax liability by reference to loss; that right does not exist independently of the section; the section uno flatu in the breath gives a specific remedy and appoints a specific tribunal for its enforcement, namely or . In those circumstances in my judgment, the taxpayer must resort to that remedy and that tribunal. In due course if dissatisfied with the decision of the commissioners concerned he can appeal to the high court by way Case Stated, but any original jurisdiction of the high court by declaration or otherwise, is, in my judgment, excluded.\u201d The contentions of the petitioners, that substituting Section 260A of the Income Tax Act and divesting of the appellate remedy and vesting it in the , is unconstitutional as it constitutes an inroad into the principles of the rule of law and independence of judiciary, according to learned counsel, are fallacious. ", "41. According to the learned counsel for the respondents, the fallacy in the petitioners\u2019 argument is, that they are overlooking the fact that as far as the NTT Act is concerned, there is no common law remedy which has now been divested. Section 260A of the Income Tax Act and Section 35(g) , ", "(h), (i) of the Excise Act were all statutorily vested appeals, in , and as such, as has been held in the above mentioned cases can be completely divested. According to learned counsel, the NTT Act, was on a surer and sounder footing, than the provisions of the Companies Act , which came up for consideration in , . Accordingly, as no common law remedy has been substituted under the present Act, it was submitted, that the contentions advanced on behalf of the petitioners had no legs to stand. Even when the Companies Act set up, and , substituting the jurisdiction of s, this Court in (supra), held that the said provisions were valid and were not unconstitutional. This Court held as under: ", "\u201c87. The Constitution contemplates judicial power being exercised by both courts and tribunals. Except the powers and jurisdictions vested in superior courts by the Constitution, powers and jurisdiction of courts are controlled and regulated by Legislative enactments. are vested with the jurisdiction to entertain and hear appeals, revisions and references in pursuance of provisions contained in several specific legislative enactments. If jurisdiction of can be created by providing for appeals, revisions and references to be heard by , jurisdiction can also be taken away by deleting the provisions for appeals, revisions or references. It also follows that the legislature has the power to create tribunals with reference to specific enactments and confer jurisdiction on them to decide disputes in regard to matters arising from such special enactments. Therefore it cannot be said that legislature has no power to transfer judicial functions traditionally performed by courts to tribunals.\u201d ", "88. The argument that there cannot be \u201cwhole-sale transfer of powers\u201d is misconceived. It is nobody's case that the entire functioning of courts in the country is transferred to tribunals. The competence of the to make a law creating tribunals to deal with disputes arising under or relating to a particular statute or statutes cannot be disputed. When a is constituted under the Companies Act , empowered to deal with disputes arising under the said Act and the statute substitutes the word \u201ctribunal\u201d in place of \u201cthe High Court\u201d necessarily there will be \u201cwhole- sale transfer\u201d of company law matters to the tribunals. It is an inevitable consequence of creation of a tribunal, for such disputes, and will no way affect the validity of the law creating the tribunal.\u201d ", "42. Similarly, statutory provisions providing for a revision to the District Judge, with the finality clauses, have been interpreted to exclude the revisionary powers of under Section 115 of CPC. In this behalf reference was made to, , , wherein it was held as under: ", "\u201c15. Under the scheme of the Act it appears that a landlord who wants eviction of his tenant has to move for eviction and the case has to be disposed of by . That is provided by Sub-section(2) of Section 11 of the Act. From , an appeal lies to under the conditions laid down under Sub-section ", "(l)(b) of Section 18 of the Act. From a revision in certain circumstances lies in case where the appellate authority is a Subordinate Judge to and in other cases to . In this case as mentioned hereinbefore the appeal lay from to the appellate authority who was the Subordinate Judge and therefore the revision lay to the District Judge. Indeed it is indisputed that the respondent has in this case taken resort to all these provisions. After the dismissal of the revision by the District Judge from the appellate decision of the Subordinate Judge who confirmed the order of the Rent Controller, the respondent-landlord chose again to go before under Section 115 of the . The question, is, can he have a second revision to ? submitted that he cannot. We are of the opinion that he is right. This position is clear if Sub-section (5) of Section 18 of the Act is read in conjunction with Section 20 of the Act. Sub-section (5) of Section 18, as we have noted hereinbefore, clearly stipulates that the decision of the appellate authority and subject to such decision, an order of the Rent Controller 'shall be final' and 'shall not be liable to be called in question in any court of law', except as provided in Section 20. By Section 20, a revision is provided where the appellate authority is Subordinate Judge to the District Judge and in other cases, that is to say, where the appellate authority is District Judge, to . The ambits of revisional powers are well-settled and need not be re-stated. It is inconceivable to have two revisions. The scheme of the Act does not warrant such a conclusion. In our opinion, the expression 'shall be final' in the Act means what it says. ", "20. The learned judge referred to the decision of in the case of and Anr.\u2014Insolvents v. , AIR 1934 PC 81. The learned judge also referred to a decision of this in . (supra). The learned judge concluded that so long as there was no specific provision in the statute making the determination by final and excluding the supervisory power of under Section 115 of the , it had to be held that the decision rendered by under Section 20(1) of the Act being a decision of a court subordinate to to which an appeal lay to was liable to be revised by under Section 115 of the . In that view of the matter, rejected the view of the division bench of in v. KLT 1248. With respect, we are unable to sustain the view of of on this aspect of the matter. In our opinion, misconstrued the provisions of subsection (5) of Section 18 of the Act. Sub-section (5) of Section18 clearly states that such decision of the appellate authority as mentioned in Section 18 of the Act shall not be liable to be questioned except in the manner under Section 20 of the Act. There was thereby an implied prohibition or exclusion of a second revision under Section 115 of the to when a revision has been provided under Section 20 of the Act in question. When Section 18(5) of the Act specifically states that \"shall not be liable to be called in question in any of law\" except in the manner provided under Section 20, it cannot be said that which is a court of law and which is a civil court under the under Section 115 of the could revise again an order once again after revision under Section20 of the Act. That would mean there would be a trial by four courts, that would be repugnant to the scheme manifest in the different sections of the Act in question. Public policy or public interest demands curtailment of law's delay and justice demands finality within quick disposal of case. The language of the provisions of Section 18(5) read with Section 20 inhibits further revision. The courts must so construe.\u201d Likewise, our attention was invited to , and reliance was placed on the following: \u201c15. Even without any discussion it may be seen from the narrative given above that there is really no conflict between the two decisions because the provisions in the two Acts are materially different. However, to clarify matters further we may point put the differences between the two Acts in greater detail and clarity. Under the Kerala Act, against an order passed by presided over by a District Munsif, the aggrieved party is conferred a right of appeal under Section 18. has to be a judicial officer not below the rank of a subordinate Judge. The appellate has been conferred powers co- extensive with those of but having over-riding effect. Having these factors in mind, the has declared that in so far as an order of is concerned it shall be final subject only to any modification or revision by an Appellate ; and in so far as the Appellate is concerned, its decision shall be final and shall not be liable to be called in question in any of law except as provided in Section 20. As regards Section 20, a division of the powers of revision exercisable thereunder has been made between and . In all those cases where a revision is preferred against a decision of an Appellate of the rank of a Subordinate Judge under Section 18, the District Judge has been constituted the revisional authority. It is only in other cases i.e. where the decision sought to be revised is that of a judicial officer of a higher rank than a Subordinate Judge, has been constituted the Revisional authority. The revisional powers conferred under Section 20, whether it be on the District Judge or as the case may be are of greater amplitude than the powers of revision exercisable by under Section 115 Code of Civil Procedure Under Section 20 the Revisional is entitled to satisfy itself about the legality regularity, or propriety of the orders sought to be revised. Not only that, the Appellate and the Revisional have been expressly conferred powers of remand under Section 20A of the Act. Therefore, a party is afforded an opportunity to put forth his case before and then before the Appellate and there after if need be before viz. if the Appellate is of the rank of a Subordinate Judge. The in its wisdom has thought that on account of the ample opportunity given to a party to put forth his case before three courts, viz. , and , there was no need to make the revisional order of subject to further scrutiny by by means of a second revision either under the Act or under the Code of Civil Procedure. It has been pointed out in case (supra) that the full Bench of had failed to construe the terms of Section 20 read with Section 18(5) in their proper perspective and this failing had effected its conclusion According to , a revisional order of a District, under Section 20 laid itself open for further challenge to under Section115 Code of Civil Procedure because of two factors viz. (1) there was no mention in the Act that the order would be final and (2) there was no provision in the Act for an appeal being filed against a revisional order under Section 20. The full Bench failed to notice certain crucial factors. In the first place, Section 20 is a composite section and refers to the powers of revision exercisable under that Section by a District Judge as well as by . Such being the case if it is to be taken that an order passed by a District under Section 20 will not have finality because the Section does not specifically say so, then it will follow that a revisional order passed by under Section 20 (1) also will not have finality Surely it cannot be contended by anyone that an order passed by in exercise of its powers of revision under Section 20 (1) can be subjected to further revision because Section 20(1) has not expressly conferred finality to an order passed under that Section. Secondly, the terms of Section 20 (1) have to be read in conjunction with Section 18(5). Section 18(5) as already seen, declares that an order of shall be final subject to the decision of the Appellate and an order of an Appellate shall be final and shall not be liable to be called in question in any court of law except as provided for in Section 20. When the has declared that even an order of and the decision of the Appellate shall be final at their respective stages unless the order is modified by the Appellate or the Revisional as the case may be, there is no necessity for the legislature to declare once ever again that an order passed in revision under Section 20(1) by the District Judge or as the case may be will also have the seal of finality. The third aspect is that the has not merely conferred finality to the decision of an Appellate but has further laid down that the decision shall not be liable to be called in question in any court of law except as provided for in Section 20. These additional words clearly spell out the prohibition or exclusion of a second revision under Section 115 Code of Civil Procedure to against a revisional order passed by a District under Section 20 of the Act. This position has been succinctly set out in para 20 of the judgment in case (supra). As was noticed in case, the intent behind the bifurcation of the jurisdiction is to reduce the number of revision petitions filed in and for determining the legislative intent, the must as far as possible construe a statute in such a manner as would advance the object of the legislation and suppress the mischief sought to be cured by it.\u201d ", "43. Most importantly, a nine-Judge constitution bench judgment of this , in , while dealing with the validity of Section 11B(3) of the Excise Act, held as follows: ", "\u201c77. Hereinbefore, we have referred to the provisions relating to refund obtaining from time to time under the Central Excise and Salt Act . Whether it is Rule 11 (as it stood from time to time) or Section 11-B (as it obtained before 1991 or subsequent thereto), they invariably purported to be exhaustive on the question of refund. Rule 11, as in force prior to August 6, 1977, stated that \"no duties and charges which have been paid or have been adjusted...shall be refunded unless the claimant makes an application for such refund under his signature and lodges it to the proper officers within three months from the date of such payment or adjustment, as the case may be\". Rule 11, as in force between 6.8.1977 and 17.11.1980 contained Sub-rule (4) which expressly declared : \"(4) Save as otherwise provided by or under this rule, no claim of refund of any duty shall be entertained\". Section 11-B, as in force prior to April, 1991 contained Sub- section (4) in identical words. It said : \"(4) Save as otherwise provided by or under this Act, no claim for refund of any duty of excise shall be entertained\". Sub-section (5) was more specific and emphatic. It said: \"Notwithstanding anything contained in any other law, the provisions of this Section shall also apply to a claim for refund of any amount collected as duty of excise made on the ground that the goods in respect of which such amount was collected were not excisable or were entitled to exemption from duty and no court shall have any jurisdiction in respect of such claim.\" ", "It started with a non-obstante clause; it took in every kind of refund and every claim for refund and it expressly barred the jurisdiction of courts in respect of such claim. Sub-section (3) of Section 11-B, as it now stands, it\u2019s to the same effect - indeed, more comprehensive and all- encompassing. It says: ", "\"(3) Notwithstanding anything to the contrary contained in any judgment, decree, order or direction of or any court or in any other provision of this Act or the rules made thereunder or in any law for the time being in force, no refund shall be made except as provided in sub- section\". ", "The language could not have been more specific and emphatic. The exclusivity of the provision relating to refund is not only express and unambiguous but is in addition to the general bar arising from the fact that the Act creates new rights and liabilities and also provides forums and procedures for ascertaining and adjudicating those rights and liabilities and all other incidental and ancillary matters, as will be pointed out presently. This is a bar upon a bar - an aspect emphasised in Para 23 (supra), and has to be respected so long as it stands. The validity of these provisions has never been seriously doubted. Even though in certain writ petitions now before us, validity of the 1991 (Amendment) Act including the amended Section 11-B is questioned, no specific reasons have been assigned why a provision of the nature of Sub-section (3) of Section11- B (amended) is unconstitutional. Applying the propositions enunciated by a seven-Judge Bench of this Court in Kamala Mills case, AIR 1965 SC 1942, it must be held that Section 11-B (both before and after amendment) is valid and constitutional. In Kamala Mills, this Court upheld the constitutional validity of Section 20 of the Bombay Sales Tax Act (set out hereinbefore) on the ground that the Bombay Act contained adequate provisions for refund, for appeal, revision, rectification of mistake and for condonation of delay in filing appeal/revision. The Court pointed out that had the Bombay Act not provided these remedies and yet barred the resort to civil court, the constitutionality of Section 20 may have been in serious doubt, but since it does provide such remedies, its validity was beyond challenge, to repeat ", "- and it is necessary to do so - so long as Section 11-B is constitutionally valid, it has to be followed and given effect to. We can see no reason on which the constitutionality of the said provision - or a similar provision - can be doubted. It must also be remembered that Central Excises and Salt Act is a special enactment creating new and special obligations and rights, which at the same time prescribes the procedure for levy, assessment, collection, refund and all other incidental and ancillary provisions. As pointed out in the Statement of Objects and Reasons appended to the Bill which became the Act, the Act along with the Rules was intended to \"form a complete central excise code\". The idea was \"to consolidate in a single enactment all the laws relating to central duties of excise\". The Act is a self-contained enactment. It contains provisions for collecting the taxes which are due according to law but have not been collected and also for refunding the taxes which have been collected contrary to law, viz., Sections 11-A and 11-B and its allied provisions. Both provisions contain a uniform rule of limitation, viz., six months, with an exception in each case. Sections 11-A and 11-B are complimentary to each other. To such a situation, Proposition No. 3 enunciated in Kamala Mills becomes applicable, viz., where a statute creates a special right or a liability and also provides the procedure for the determination of the right or liability by the constituted in that behalf and provides further that all questions about the said right and liability shall be determined by the so constituted, the resort to civil court is not available ", "-except to the limited extent pointed out in Kamala Mills. Central Excise Act specifically provides for refund. It expressly declares that no refund shall be made except in accordance therewith. The jurisdiction of a civil is expressly barred - vide Sub-section (5) of Section 11-B, prior to its amendment in 1991, and Sub-section (3) of Section 11-B, as amended in 1991. It is relevant to notice that the Act provides for more than one appeal against the orders made under Section 11-B/Rule 11. Since 1981, an appeal is provided to this also from the orders of the . While is not a departmental organ, this is a civil court. In this view of the matter and the express and additional bar and exclusivity contained in Rule 11/Section 11-B, at all points of time, it must be held that any and every ground including the violation of the principles of natural justice and infraction of fundamental principles of judicial procedure can be urged in these appeals, obviating the necessity of a suit or a writ petition in matters relating to refund. Once the constitutionality of the provisions of the Act including the provisions relating to refund is beyond question, they constitute \"law\" within the meaning of Article 265 of the Constitution. It follows that any action taken under and in accordance with the said provisions would be an action taken under the \"authority of law\", within the meaning of Article 265. In the face of the express provision which expressly declares that no claim for refund of any duty shall be entertained except in accordance with the said provisions, it is not permissible to resort to Section 72 of the Contract Act to do precisely that which is expressly prohibited by the said provisions. In other words, it is not permissible to claim refund by invoking Section 72 as a separate and independent remedy when such a course is expressly barred by the provisions in the Act, viz., Rule 11 and Section 11-B. For this reason, a suit for refund would also not lie. Taking any other view would amount to nullifying the provisions in Rule 11/Section 11-B, which, it needs no emphasis, cannot be done. It, therefore, follows that any and every claim for refund of excise duty can be made only under and in accordance with Rule 11 or Section 11-B, as the case may be, in the forums provided by the Act. No suit can be filed for refund of duty invoking Section 72 of the Contract Act . So far as the jurisdiction of the High under Article 226 - or for that matter, the jurisdiction of this under Article 32 - is concerned, it is obvious that the provisions of the Act cannot bar and curtail these remedies. It is, however, equally obvious that while exercising the power under Article 226 / Article 32 , the would certainly take note of the legislative intent manifested in the provisions of the Act and would exercise their jurisdiction consistent with the provisions of the enactment.\u201d It was submitted, that a perusal of the above paragraph shows, that this noticed, that against the order of the tribunal an appeal was provided for to this . The declared, that the tribunal was not a departmental organ and the Supreme was a civil court as it was hearing a statutory appeal. More importantly it held, that every ground including violation and infraction of judicial procedure could be urged in these appeals, obviating the necessity of a suit or a writ petition in matters relating to refund. This took care to hold, that so far as the jurisdiction of High s under Article 226 or this under Article 32 are concerned, they cannot be curtailed. It further held, that it was equally obvious that while exercising the power under Article 226 /32 the would certainly take note of the legislative intent manifested in the provisions of the Act and would exercise their jurisdiction consistent with the provisions of the enactment. It was accordingly submitted, that in view of the conclusions drawn, in the above judgment, all the contentions urged by the petitioners, needed to be rejected. The third contention: ", "44. Learned counsel for the respondents, vehemently controverted the submissions advanced at the hands of the petitioners, that the NTT Act was ultra vires the provisions of the Constitution. Insofar as the instant aspect of the matter is concerned, learned counsel for the respondents, first placed reliance on Article 246 of the Constitution. Article 246 is being extracted hereunder: ", "\u201c246. Subject-matter of laws made by Parliament and by the Legislatures of States \u2013 (1) Notwithstanding anything in clauses (2) and (3), Parliament has exclusive power to make laws with respect to any of the matters enumerated in List I in the Seventh Schedule (in this Constitution referred to as the \u201cUnion List\u201d). ", "(2) Notwithstanding anything in clause (3), and, subject to clause (1), the of any State also, have power to make laws with respect to any of the matters enumerated in List III in the Seventh Schedule (in this Constitution referred to as the \u201cConcurrent List\u201d). (3) Subject to clauses (1) and (2), the of any State has exclusive power to make laws for such State or any part thereof with respect to any of the matters enumerated in List II in the Seventh Schedule (in this Constitution referred to as the \u2018State List\u2019). (4) has power to make laws with respect to any matter for any part of the territory of India not included (in a State) notwithstanding that such matter is a matter enumerated in the State List.\u201d Based on the aforesaid provision, it was sought to be asserted that the had the unqualified and absolute jurisdiction, power and authority to enact laws in respect of matters enumerated in Lists I and III of the Constitution. Additionally, placing reliance on Article 246(4 ), it was asserted, that even on subjects not expressly provided for in the three Lists of the Seventh Schedule to the Constitution, the still had the absolute and untrammeled right to enact legislation. Insofar as the instant aspect of the matter is concerned, learned counsel for the respondents placed reliance on entries 77 to 79, 82 to 84, 95 and 97 of List I. The above entries are being extracted hereunder: List I \u2013 Union List \u201c77. Constitution, organisation, jurisdiction and powers of (including contempt of such Court), and the fees taken therein; persons entitled to practise before . ", "78. Constitution and organisation (including vacations) of except provisions as to officers and servants of ; persons entitled to practise before . ", "79. Extension of the jurisdiction of to, and exclusion of the jurisdiction of from, any territory. ", "82. Taxes on income other than agricultural income. ", "83. Duties of customs including export duties. ", "84. Duties of excise on tobacco and other goods manufactured or produced in India except \u2013 ", "(a) alcoholic liquors for human consumption. ", "(b) opium, Indian hemp and other narcotic drugs and narcotics, but including medicinal and toilet preparations containing alcohol or any substance included in sub-paragraph (b) of this entry. ", "95. Jurisdiction and powers of all courts, except , with respect to any of the matters in this List; admiralty jurisdiction. ", "97. Any other matter not enumerated in List II or List III including any tax not mentioned in either of those Lists.\u201d Based on the entries reproduced hereinabove, especially entries 77 to 79, it was submitted, that had the jurisdiction to enact legislation even in respect of and . Additionally, it had the power to legislate, and thereby, to extend or exclude the jurisdiction of . Relying on entries 82 to 84, it was the submission of the learned counsel for the respondents, that on matters of income-tax, customs duty and excise duty, the power to legislate was unequivocally vested with the . Reliance was placed on entry 95, to contend, that the extent of the jurisdiction of all courts including , in respect of matters expressed in List I could also be laid down by the . Referring again to entries 82 to 84 it was submitted, that the extension or exclusion of jurisdiction on tax matters, was also within the domain of . So as to assert, that in case this Court was of the view, that the subject of the legislation contained in the NTT Act did not find mention, in any of the three Lists of the Seventh Schedule of the Constitution, the submission on behalf of the respondents was, that would still have the authority to legislate thereon, under entry 97 contained in List I of the Seventh Schedule. ", "45. Learned counsel for the respondents, also placed reliance on entries 11A and 46 contained in List III of Seventh Schedule. The above entries are being extracted hereunder: ", "List III \u2013 Concurrent List \u201c11A. Administration of justice; constitution and organisation of all courts, except and . ", "xxx xxx xxx ", "46. Jurisdiction and powers of all courts, except , with respect to any of the matters in this List.\u201d Referring to the above entries, it was the contention of the learned counsel for the respondents that had the authority to enact legislation, in respect of the extent of jurisdiction and powers of courts, including . It was, however pointed out, that this power extended only to such matters and subjects, that found mention in List III of the Seventh Schedule. It was, therefore, that reliance was placed on entry 11A in List III, to contend that administration of justice, constitution and organization of all courts (except and s) would lead to the inevitable conclusion that the NTT Act was promulgated, well within the power vested with the , under Article 246(2) of the Constitution. ", "46. Additionally, reliance was placed by the learned counsel for the respondents, on Article 247 of the Constitution, which is reproduced hereunder: ", "\u201c247. Power of to provide for the establishment of certain additional courts. - Notwithstanding anything in this Chapter, may by law provide for the establishment of any additional courts for the better administration of laws made by or of any existing laws with respect to a matter enumerated in the Union List.\u201d Referring to the above provision, it was the assertion of the learned counsel for the respondents, that power was expressly vested with the , to establish additional courts, for better administration of laws. It was submitted, that this was exactly what the had chosen to do, while enacting the Act. Referring to the objects and reasons, indicating the basis of the enactment of the Act, it was the categoric assertion at the hands of the learned counsel, that the impugned enactment was promulgated with the clear understanding, that the would provide better adjudication of legal issues, arising out of direct/indirect tax laws. ", "47. Besides Articles 246 and 247 of the Constitution, learned counsel for the respondents asserted, that Articles 323A and 323B were inserted into the Constitution, by the Constitution (Forty-second Amendment) Act, 1976. The above provisions were included in the newly enacted Part XIV A of the Constitution. It was asserted, that the instant amendment of the Constitution was made for achieving two objectives. Firstly, to exclude the power of judicial review of and , totally. Thus excluding judicial review in its entirety. And secondly, to create independent specialized tribunals, with power of judicial review, which would ease the burden of and . It was however acknowledged by learned counsel representing the respondents, that the first of the above mentioned objectives, was interpreted by this in , which struck down clause (2)(d) of Article 323A and clause (3)(d) of Article 323B , to the extent the amended provisions introduced by the Forty-second Amendment to the Constitution, excluded the jurisdiction of and under Articles 226/227 and 32/136 respectively. Insofar as the second objective is concerned, placing reliance in case (supra), it was the contention of the learned counsel for the respondents, that this had clearly concluded, that as long as the power of judicial review continue with and , under the provisions referred to hereinabove, the enactment under reference would be constitutionally valid. Therefore, in response to the submissions advanced at the hands of the learned counsel for the petitioners (as have been noticed hereinabove), it was the contention of the learned counsel for the respondents, that the power to enact the NTT Act, was clearly vested with the even under Article 323B of the Constitution. Furthermore, since the impugned enactment did not exclude the jurisdiction of under Articles 226 and 227 of the Constitution, and also, did not exclude the jurisdiction of under Articles 32 and 136 of the Constitution, the challenge to the constitutional validity of the NTT Act was wholly unjustified. ", "48. Learned counsel for the respondents was at pains to emphasise, that the jurisdictional road of , as final interpreter of the law, was clearly preserved. Firstly, because a statutory appeal was provided for under the Act to . And secondly because, judicial review vested in the High under Articles 226 and 227 of the Constitution, and in under Articles 32 and 136 of the Constitution, had been kept intact. It is, therefore, the submission of the learned counsel for the respondents, that no fault can be found in the vesting of appellate jurisdiction from orders passed by Appellate Tribunals (constituted under the Income Tax Act , Customs Act and the Excise Act ) with the . ", "49. While acknowledging the fact, that the jurisdiction vested in to hear appeals from the Appellate Tribunals, under the Income Tax Act (vide Section 260A ), the Customs Act (vide Section 130 ), and the Excise Act (vide Section 35G ), has been transferred from the jurisdictional to the , it was submitted that appellate jurisdiction vested in a under a statute, could be taken away by an amendment of the statute. Stated simply, the submission at the behest of the respondents was, whatever is vested by a statutory enactment, can likewise be divested in the same manner. It was therefore sought to be asserted, that the grounds of challenge to the Act raised, at the behest of the petitioners, were misconceived and unacceptable. 50. Besides the submissions noticed hereinabove, it was also contended on behalf of the respondents, that the assertion made by the petitioners, that appellate jurisdiction on \u201csubstantial questions of law\u201d could not be vested with the , was fallacious. In this behalf, it was sought to be reiterated, that jurisdiction of civil courts (including the original side of the ) was barred in respect of tax related issues. It was sought to be explained, that a case could involve questions of fact, as well as, questions of law right from the stage of the initial adjudicatory authority. But, it was pointed out, that only cases involving \u201csubstantial questions of law\u201d would qualify for adjudication at the hands of the . As such, placing reliance on the decision in , it was submitted, that the above contention raised by the petitioners had no legs to stand. Furthermore, it was sought to be pointed out, that the phrase \u201csubstantial questions of law\u201d has been interpreted by this Court to mean, not only questions of general pubic importance, but also questions which would directly and substantially affect the rights of the parties to the litigation. It was also asserted, that a question of law would also include, a legal issue not previously settled, subject to the condition, that it had a material bearing on the determination of the controversy to be settled, between the parties. It is accordingly contended, that no limited interpretation could be placed on the term \u201csubstantial questions of law\u201d. Accordingly, it was submitted, that a challenge to the constitution of the on the premise that the was vested with the jurisdiction to settle \u201csubstantial questions of law\u201d was unsustainable. ", "51. In order to support his above submission, learned counsel for the respondents placed emphatic reliance on a few judgments rendered by this Court. The same are being noticed hereunder: ", "(i) Reliance was also placed on , . Learned counsel for the respondents, while relying on the instant judgment, made a reference to various observations recorded therein. We wish to incorporate hereunder all the paragraphs on which reliance was placed by the learned counsel:- ", "\u201c80. However, it is important to emphasise that though the subordinate judiciary or created under ordinary legislations cannot exercise the power of judicial review of legislative action to the exclusion of and , there is no constitutional prohibition against their performing a supplemental \u2014 as opposed to a substitutional \u2014 role in this respect. That such a situation is contemplated within the constitutional scheme becomes evident when one analyses clause (3) of Article 32 of the Constitution which reads as under: ", "\u201c32. Remedies for enforcement of rights conferred by this Part.\u2014 (1) \u2026 \u2026 \u2026 \u2026 \u2026 (2) \u2026 \u2026 \u2026 \u2026 \u2026 (3) Without prejudice to the powers conferred on by clauses (1) and (2), Parliament may by law empower any other court to exercise within the local limits of its jurisdiction all or any of the powers exercisable by under clause (2).\u201d ", "81. If the power under Article 32 of the Constitution, which has been described as the \u201cheart\u201d and \u201csoul\u201d of the Constitution, can be additionally conferred upon \u201cany other court\u201d, there is no reason why the same situation cannot subsist in respect of the jurisdiction conferred upon under Article 226 of the Constitution. So long as the jurisdiction of under Articles 226/227 and that of this under Article 32 is retained, there is no reason why the power to test the validity of legislations against the provisions of the Constitution cannot be conferred upon Administrative Tribunals created under the Act or upon Tribunals created under Article 323-B of the Constitution. It is to be remembered that, apart from the authorisation that flows from Articles 323-A and 323-B, both and the State Legislatures possess legislative competence to effect changes in the original jurisdiction of the Supreme and . This power is available to under Entries 77, 78, 79 and 95 of List I and to the State Legislatures under Entry 65 of List II; Entry 46 of List III can also be availed of both by and the State Legislatures for this purpose. ", "82. There are pressing reasons why we are anxious to preserve the conferment of such a power on these . When the Framers of our Constitution bestowed the powers of judicial review of legislative action upon and , they ensured that other constitutional safeguards were created to assist them in effectively discharging this onerous burden. The expectation was that this power would be required to be used only occasionally. However, in the five decades that have ensued since Independence, the quantity of litigation before the High [pic]Courts has exploded in an unprecedented manner. The decision in case, AIR 1987 SC 386, was rendered against such a backdrop. We are conscious of the fact that when of this Court in case (supra) adopted the theory of alternative institutional mechanisms, it was attempting to remedy an alarming practical situation and the approach selected by it appeared to be most appropriate to meet the exigencies of the time. Nearly a decade later, we are now in a position to review the theoretical and practical results that have arisen as a consequence of the adoption of such an approach. ", "83. We must, at this stage, focus upon the factual position which occasioned the adoption of the theory of alternative institutional mechanisms in case (supra). In his leading judgment, refers to the fact that since Independence, the population explosion and the increase in litigation had greatly increased the burden of pendency in . Reference was made to studies conducted towards relieving of their increased load. In this regard, the recommendations of for setting up independent Tribunals as also the suggestion of that Civil Service Tribunals be set up, were noted. Reference was also made to the decision in , , where this had, while emphasising the need for speedy resolution of service disputes, proposed the establishment of Service Tribunals. ", "84. The problem of clearing the backlogs of , which has reached colossal proportions in our times is, nevertheless, one that has been the focus of study for close to a half century. Over time, several Expert Committees and have analysed the intricacies involved and have made suggestions, not all of which have been consistent. Of the several studies that have been conducted in this regard, as many as twelve have been undertaken by (hereinafter referred to as \u201cthe \u201d) or similar high-level committees appointed by , and are particularly noteworthy. (Report of , 1949; , 14th Report on Reform of Judicial Administration (1958); , 27th Report on Code of Civil Procedure, 1908 (1964); , 41st Report on Code of Criminal Procedure, 1898 (1969); , 54th Report of Code of Civil Procedure, 1908 (1973); , 57th Report on Structure and Jurisdiction of the Higher Judiciary (1974); , 1972; , 79th Report on Delay and Arrears in and other Appellate Courts (1979); , 99th Report on Oral Arguments and Written Arguments in the Higher Courts (1984); Committee Report 1986; , 124th Report on the High Court Arrears \u2013 A Fresh Look (1988); Report of the Arrears Committee (1989-90). ", "85. An appraisal of the daunting task which confronts can be made by referring to the assessment undertaken by the in its 124th Report which was released sometime after the judgment in case (supra). The Report was delivered in 1988, nine years ago, and some changes have occurred since, but the broad perspective which emerges is still, by and large, true: ", "\u201c\u2026 enjoy civil as well as criminal, ordinary as well as extraordinary, and general as well as special jurisdiction. The source of the jurisdiction is the Constitution and the various statutes as well as letters patent and other instruments constituting . in the country enjoy an original jurisdiction in respect of testamentary, matrimonial and guardianship matters. Original jurisdiction is conferred on under the Representation of the People Act , 1951, Companies Act , 1956, and several other special statutes. , being courts of record, have the power to punish for its contempt as well as contempt of its subordinate courts. enjoy extraordinary jurisdiction under Articles 226 and 227 of the Constitution enabling it to issue prerogative writs, such as, the one in the nature of habeas corpus, mandamus, prohibition, quo warranto and certiorari. Over and above this, of Bombay, Calcutta, Delhi, Himachal Pradesh, Jammu and Kashmir and Madras also exercise ordinary original civil jurisdiction. also enjoy advisory jurisdiction, as evidenced by Section 256 of the Indian Companies Act, 1956, Section 27 of the Wealth Tax Act, 1957, Section 26 of the Gift Tax Act, 1958, and Section 18 of the Companies (Profits) Surtax Act, 1964. Similarly, there are parallel provisions conferring advisory jurisdiction on , such as, Section 130 of the Customs Act, 1962, and Section 354 of the Central Excises and Salt Act , 1944. have also enjoyed jurisdiction under the Indian Divorce Act , 1869, and the Parsi Marriage and Divorce Act , 1936. Different types of litigation coming before in exercise of its wide jurisdiction bear different names. The vast area of jurisdiction can be appreciated by reference to those names, viz., ", "(a) first appeals; (b) appeals under the letters patent; (c) second appeals; (d) revision petitions; (e) criminal appeals; (f) criminal revisions; (g) civil and criminal references; (h) writ petitions; (i) writ appeals; (j) references under direct and indirect tax laws; (k) matters arising under the Sales Tax Act ; (l) election petitions under the Representation of the People Act ; (m) petitions under the Companies Act , Banking Companies Act and other special Acts and (n) wherever has original jurisdiction, suits and other proceedings in exercise of that jurisdiction. This varied jurisdiction has to some extent been responsible for a very heavy institution of matters in s.\u201d ", "86. After analysing the situation existing in at length, the made specific recommendations towards the establishment of specialist Tribunals thereby lending force to the approach adopted in case (supra). The noted the erstwhile international judicial trend which pointed towards generalist courts yielding their place to specialist Tribunals. Describing the pendency in as \u201ccatastrophic, crisis-ridden, almost unmanageable, imposing \u2026 an immeasurable burden on the system\u201d, the stated that the prevailing view in [pic]Indian Jurisprudence that the jurisdiction enjoyed by is a holy cow required a review. It, therefore, recommended the trimming of the jurisdiction of by setting up specialist courts/Tribunals while simultaneously eliminating the jurisdiction of . ", "87. It is important to realise that though the theory of alternative institutional mechanisms was propounded in case (supra) in respect of , the concept itself \u2014 that of creating alternative modes of dispute resolution which would relieve of their burden while simultaneously providing specialised justice \u2014 is not new. In fact, the issue of having a specialised tax court has been discussed for several decades; though the Report of the High Court Arrears Committee (1972) dismissed it as \u201cill-conceived\u201d, the , in its 115th Report (1986) revived the recommendation of setting up separate . Similarly, other Reports of the have suggested the setting up of \u2018Gram Nyayalayas\u2019 [, 114th Report (1986)], Industrial/Labour Tribunals [, 122nd Report (1987)] and Education Tribunals [, 123rd Report (1987)]. ", "88. In case, (1993) AIR SCW 1899, this had, in order to understand how the theory of alternative institutional mechanisms had functioned in practice, recommended that the or a similar expert body should conduct a survey of the functioning of these . It was hoped that such a study, conducted after gauging the working of the over a sizeable period of more than five years would provide an answer to the questions posed by the critics of the theory. Unfortunately, we do not have the benefit of such a study. We may, however, advert to the Report of the Arrears (1989-90), popularly known as the Malimath Report, which has elaborately dealt with the aspect. The observations contained in the Report, to this extent they contain a review of the functioning of the over a period of three years or so after their institution, will be useful for our purpose. Chapter VIII of the second volume of the Report, \u201cAlternative Modes and Forums for Dispute Resolution\u201d, deals with the issue at length. After forwarding its specific recommendations on the feasibility of setting up \u2018Gram Nyayalayas\u2019, Industrial and Educational , the has dealt with the issue of set up under Articles 323-A and 323-B of the Constitution. The relevant observations in this regard, being of considerable significance to our analysis, are extracted in full as under: ", "\u201cFunctioning of Tribunals 8.63 Several tribunals are functioning in the country. Not all of them, however, have inspired confidence in the public mind. The reasons are not far to seek. The foremost is the lack of competence, objectivity and judicial approach. The next is their constitution, the power and method of appointment of personnel thereto, the inferior status and the casual method of working. The last is their actual composition; men of calibre are not willing to be appointed as presiding officers in view of the uncertainty of tenure, unsatisfactory conditions of service, executive subordination in matters of administration and political interference in [pic]judicial functioning. For these and other reasons, the quality of justice is stated to have suffered and the cause of expedition is not found to have been served by the establishment of such tribunals. ", "8.64 Even the experiment of setting up of under Act , 1985, has not been widely welcomed. Its members have been selected from all kinds of services including . The decision of are not appealable except under Article 136 of the Constitution. On account of the heavy cost and remoteness of the forum, there is virtual negation of the right of appeal. This has led to denial of justice in many cases and consequential dissatisfaction. There appears to be a move in some of the States where they have been established for their abolition. Tribunals \u2014 Tests for Including Jurisdiction 8.65 A Tribunal which substitutes as an alternative institutional mechanism for judicial review must be no less efficacious than . Such a tribunal must inspire confidence and public esteem that it is a highly competent and expert mechanism with judicial approach and objectivity. What is needed in a tribunal, which is intended to supplant , is legal training and experience, and judicial acumen, equipment and approach. When such a tribunal is composed of personnel drawn from the judiciary as well as from services or from amongst experts in the field, any weightage in favour of the service members or expert members and value-discounting the judicial members would render the tribunal less effective and efficacious than . The Act setting up such a tribunal would itself have to be declared as void under such circumstances. The same would not at all be conducive to judicial independence and may even tend, directly or indirectly, to influence their decision-making process, especially when the is a litigant in most of the cases coming before such tribunal. (See case (supra)). The protagonists of specialist tribunals, who simultaneously with their establishment want exclusion of the writ jurisdiction of s in regard to matters entrusted for adjudication to such tribunals, ought not to overlook these vital and important aspects. It must not be forgotten that what is permissible to be supplanted by another equally effective and efficacious institutional mechanism is s and not the judicial review itself. Tribunals are not an end in themselves but a means to an end; even if the laudable objectives of speedy justice, uniformity of approach, predictability of decisions and specialist justice are to be achieved, the framework of the tribunal intended to be set up to attain them must still retain its basic judicial character and inspire public confidence. Any scheme of decentralisation of administration of justice providing for an alternative institutional mechanism in substitution of s must pass the aforesaid test in order to be constitutionally valid. 8.66 The overall picture regarding the tribunalisation of justice in our country is not satisfactory and encouraging. There is a need for a fresh look and review and a serious consideration before the experiment is extended to new areas of fields, especially if the constitutional jurisdiction of s is to be simultaneously ousted. Not many tribunals satisfying the aforesaid tests can possibly be established.\u201d Having expressed itself in this manner, specifically recommended that the theory of alternative institutional mechanisms be abandoned. Instead, it recommended that institutional changes be carried out within s, dividing them into separate divisions for different branches of law, as is being done in England. It stated that appointing more Judges to man the separate divisions while using the existing infrastructure would be a better way of remedying the problem of pendency in s. ", "89. In the years that have passed since the Report of was delivered, the pendency in has substantially increased and we are of the view that its recommendation is not suited to our present context. That the various have not performed up to expectations is a self-evident and widely acknowledged truth. However, to draw an inference that their unsatisfactory performance points to their being founded on a fundamentally unsound principle would not be correct. The reasons for which the were constituted still persist; indeed, those reasons have become even more pronounced in our times. We have already indicated that our constitutional scheme permits the setting up of such . However, drastic measures may have to be resorted to in order to elevate their standards to ensure that they stand up to constitutional scrutiny in the discharge of the power of judicial review conferred upon them. ", "90. We may first address the issue of exclusion of the power of judicial review of . We have already held that in respect of the power of judicial review, the jurisdiction of under Articles 226/227 cannot be excluded. It has been contended before us that the should not be allowed to adjudicate upon matters where the vires of legislations is questioned, and that they should restrict themselves to handling matters where constitutional issues are not raised. We cannot bring ourselves to agree to this proposition as that may result in splitting up proceedings and may cause avoidable delay. If such a view were to be adopted, it would be open for litigants to raise constitutional issues, many of which may be quite frivolous, to directly approach and thus subvert the jurisdiction of the . Moreover, even in these special branches of law, some areas do involve the consideration of constitutional questions on a regular basis; for instance, in service law matters, a large majority of cases involve an interpretation of Articles 14, 15 and 16 of the Constitution. To hold that the have no power to handle matters involving constitutional issues would not serve the purpose for which they were constituted. On the other hand, to hold that all such decisions will be [pic]subject to the jurisdiction of under Articles 226/227 of the Constitution before of within whose territorial jurisdiction the concerned falls will serve two purposes. While saving the power of judicial review of legislative action vested in under Articles 226/227 of the Constitution, it will ensure that frivolous claims are filtered out through the process of adjudication in the . will also have the benefit of a reasoned decision on merits which will be of use to it in finally deciding the matter. ", "91. It has also been contended before us that even in dealing with cases which are properly before the , the manner in which justice is dispensed by them leaves much to be desired. Moreover, the remedy provided in the parent statutes, by way of an appeal by special leave under Article 136 of the Constitution, is too costly and inaccessible for it to be real and effective. Furthermore, the result of providing such a remedy is that the docket of is crowded with decisions of that are challenged on relatively trivial grounds and it is forced to perform the role of a first appellate court. We have already emphasised the necessity for ensuring that are able to exercise judicial superintendence over the decisions of the under Article 227 of the Constitution. In case (supra), after taking note of these facts, it was suggested that the possibility of an appeal from the on questions of law to of within whose territorial jurisdiction the falls, be pursued. It appears that no follow-up action has been taken pursuant to the suggestion. Such a measure would have improved matters considerably. Having regard to both the aforestated contentions, we hold that all decisions of , whether created pursuant to Article 323-A or Article 323-B of the Constitution, will be subject to writ jurisdiction under Articles 226/227 of the Constitution, before of within whose territorial jurisdiction the particular falls. ", "92. We may add here that under the existing system, direct appeals have been provided from the decisions of all to under Article 136 of the Constitution. In view of our above-mentioned observations, this situation will also stand modified. In the view that we have taken, no appeal from the decision of a will directly lie before under Article 136 of the Constitution; but instead, the aggrieved party will be entitled to move under Articles 226/227 of the Constitution and from the decision of of the aggrieved party could move this Court under Article 136 of the Constitution. ", "93. Before moving on to other aspects, we may summarise our conclusions on the jurisdictional powers of these s. The s are competent to hear matters where the vires of statutory provisions are questioned. However, in discharging this duty, they cannot act as substitutes for and which have, under our constitutional set-up, been specifically entrusted with such an obligation. Their function in this respect is only supplementary and all such decisions of [pic]the s will be subject to scrutiny before of the respective . The s will consequently also have the power to test the vires of subordinate legislations and rules. However, this power of the s will be subject to one important exception. The s shall not entertain any question regarding the vires of their parent statutes following the settled principle that a which is a creature of an Act cannot declare that very Act to be unconstitutional. In such cases alone, the concerned may be approached directly. All other decisions of these s, rendered in cases that they are specifically empowered to adjudicate upon by virtue of their parent statutes, will also be subject to scrutiny before of their respective . We may add that the s will, however, continue to act as the only courts of first instance in respect of the areas of law for which they have been constituted. By this, we mean that it will not be open for litigants to directly approach even in cases where they question the vires of statutory legislations (except, as mentioned, where the legislation which creates the particular is challenged) by overlooking the jurisdiction of the concerned . ", "94. The directions issued by us in respect of making the decisions of Tribunals amenable to scrutiny before of the respective will, however, come into effect prospectively i.e. will apply to decisions rendered hereafter. To maintain the sanctity of judicial proceedings, we have invoked the doctrine of prospective overruling so as not to disturb the procedure in relation to decisions already rendered.\u201d Based on the decisions of this Court referred to above, it was the contention of the learned counsel for the respondents, that the submissions advanced on behalf of the petitioners, are liable to outright rejection. ", "(ii) Reliance was placed first of all on Court Bar Association, . Insofar as the controversy raised in the instant judgment is concerned, it would be relevant to mention, that banks and financial institutions had been experiencing considerable difficulties in recovery of loans, and enforcement of securities. The procedure for recovery of debts due to banks and financial institutions, which was being followed, had resulted in the funds being blocked. To remedy the above situation, enacted the Recovery of Debts Due to Banks and Financial Institutions Act, 1993. The Act , inter alia, provided for establishment of tribunals and Appellate Tribunals. The said tribunals were given jurisdiction, powers and authority, to entertain and decide, applications from banks and financial institutions, for recovery of debts, due to banks and financial institutions. , was vested with the jurisdiction and authority, to entertain appeals. The procedure to be followed by the tribunals, as also, , was provided for under the above enactment. The legislation also provided for modes of recovery of debts through Recovery Officers (appointed under the Act). The constitutional validity of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 was raised on the ground, that the legislation was unreasonable and violative of Article 14 of the Constitution. It was also the claim of those who raised the said challenge, that the enactment was beyond the legislative competence of the . The controversy came to be examined, in the first instance, by (in , AIR 1975 Delhi 323). The held, that even though the tribunal could be constituted by the , and even though the constitution of the tribunal was within the purview of Articles 323A and 323B of the Constitution, and despite the fact that, the expression \u201cadministration of justice\u201d appearing in entry 11A of List III of the Seventh Schedule to the Constitution, would also include tribunals administering justice, yet the impugned Act was unconstitutional, as it had the effect of eroding the independence of the judiciary, besides being irrational, discriminatory, unreasonable and arbitrary. As such it was held, that the provisions of the enactment were violative of the mandate contained in Article 14 of the Constitution. , in its judgment, also quashed the appointment of Presiding Officers of the tribunal. While adjudicating upon the above controversy in reference to some of the issues that have been raised before us, our pointed attention was invited to the following observations: ", "\u201c21. \u2026.. Sub-section (20) of Section 19 provides that after giving the applicant and the defendant an opportunity of being heard, the may pass such interim or final order as it thinks fit to meet the ends of justice. It is after this order that a certificate is issued by the Presiding Officer to the Recovery Officer for recovery of money. Section 22 of the Act has not been amended. Therefore, reading [pic] Sections 19 and 22 of the Act together, it appears that the and the Appellate are to be guided by the principles of natural justice while trying the matter before them. Section 22(1) of the Act stipulates that the and the Appellate , while being guided by the principles of natural justice, are to be subjected to the other provisions of the Act and the Rules. Rule 12(7) provides that if a defendant denies his liability to pay the claim made by the applicant, the may act upon the affidavit of the applicant who is acquainted with the facts of the case. In this Rule, which deals with the consideration of the applicant\u2019s bank application, there is no reference to the examination of witnesses. This sub-rule refers only to the affidavit of the applicant. Rule 12(6), on the other hand, provides that the may, at any time, for sufficient reason order a fact to be proved by affidavit or may pass an order that the affidavit of any witness may be read at the hearing. It is in the proviso to this sub-rule that a reference is made to the cross-examination of witnesses. ", "22. At the outset, we find that Rule 12 is not happily worded. The reason for establishing Banking being to expedite the disposal of the claims by the banks, thought it proper only to require the principles of natural justice to be the guiding factor for the in deciding the applications, as is evident from Section 22 of the Act. While the has, no doubt, been given the power of summoning and enforcing the attendance of any witness and examining him on oath, but the Act does not contain any provision which makes it mandatory for the witness to be examined, if such a witness could be produced. Rule 12(6) has to be read harmoniously with the other provisions of the Act and the Rules. As we have already noticed, Rule 12(7) gives the the power to act upon the affidavit of the applicant where the defendant denies his liability to pay the claims. Rule 12(6), if paraphrased, would read as follows: ", "1. the may, at any time for sufficient reason, order that any particular fact or facts may be proved by affidavit \u2026 on such conditions as the thinks reasonable; ", "2. the may, at any time for sufficient reason, order \u2026 that the affidavit of any witness may be read at the hearing, on such conditions as the thinks reasonable. ", "23. In other words, the has the power to require any particular fact to be proved by affidavit, or it may order that the affidavit of any witness may be read at the hearing. While passing such an order, it must record sufficient reasons for the same. The proviso to Rule 12(6) would certainly apply only where the chooses to issue a direction on its own, for any particular fact to be proved by affidavit or the affidavit of a witness being read at the hearing. The said proviso refers to the desire of an applicant or a defendant for the production of a witness for cross- examination. In the setting in which the said proviso occurs, it would appear to us that once the parties have filed affidavits in support of their respective cases, it is only thereafter that the desire for a witness to be cross-examined can legitimately [pic]arise. It is at that time, if it appears to the , that such a witness can be produced and it is necessary to do so and there is no desire to prolong the case that it shall require the witness to be present for cross-examination and in the event of his not appearing, then the affidavit shall not be taken into evidence. When and in exercise of their jurisdiction under Article 226 and Article 32 can decide questions of fact as well as law merely on the basis of documents and affidavits filed before them ordinarily, there should be no reason as to why a , likewise, should not be able to decide the case merely on the basis of documents and affidavits before it. It is common knowledge that hardly any transaction with the bank would be oral and without proper documentation, whether in the form of letters or formal agreements. In such an event the bona fide need for the oral examination of a witness should rarely arise. There has to be a very good reason to hold that affidavits, in such a case, would not be sufficient. ", "24. The manner in which a dispute is to be adjudicated upon is decided by the procedural laws which are enacted from time to time. It is because of the enactment of the Code of Civil Procedure that normally all disputes between the parties of a civil nature would be adjudicated upon by the civil courts. There is no absolute right in anyone to demand that his dispute is to be adjudicated upon only by a civil court. The decision of proceeds on the assumption that there is such a right. As we have already observed, it is by reason of the provisions of the Code of Civil Procedure that the civil courts had the right, prior to the enactment of the Debts Recovery Act , to decide the suits for recovery filed by the banks and financial institutions. This forum, namely, that of a civil court, now stands replaced by in respect of the debts due to the bank. When in the Constitution Articles 323-A and 323-B contemplate establishment of a and that does not erode the independence of the judiciary, there is no reason to presume that the Banking s and the Appellate s so constituted would not be independent, or that justice would be denied to the defendants or that the independence of the judiciary would stand eroded. ", "25. Such s, whether they pertain to income tax or sales tax or excise or customs or administration, have now become an essential part of the judicial system in this country. Such specialised institutions may not strictly come within the concept of the judiciary, as envisaged by Article 50 , but it cannot be presumed that such s are not an effective part of the justice delivery system, like courts of law. It will be seen that for a person to be appointed as a Presiding Officer of a , he should be one who is qualified to be a District Judge and, in case of appointment of the Presiding Officer of he is, or has been, qualified to be a Judge of or has been a member of who has held a post in Grade I for at least three years or has held office as the Presiding Officer of a for at least three years. Persons who are so appointed as Presiding Officers of the or of would be well versed in law to be able to decide cases independently and judiciously. It has to be borne in mind that the decision of is not final, in [pic]the sense that the same can be subjected to judicial review by under Articles 226 and 227 of the Constitution. ", "26. With the establishment of the , Section 31 provides for the transfer of pending cases from civil courts to the . We do not find such a provision being in any way bad in law. Once a Debts Recovery has been established, and the jurisdiction of courts barred by Section 18 of the Act, it would be only logical that any matter pending in the civil court should stand transferred to the . This is what happened when the Central Administrative was established. All cases pending in stood transferred. Now that exclusive jurisdiction is vested in the Banking , it is only in that forum that bank cases can be tried and, therefore, a provision like Section 31 was enacted. ", "27. With regard to the observations of in relation to the pecuniary jurisdiction of the and of , the Act has been enacted for the whole of India. In most of the States, do not have original jurisdiction. In order to see that the is not flooded with cases where the amounts involved are not very large, the Act provides that it is only where the recovery of the money is more than Rs 10 lakhs that the will have the jurisdiction to entertain the application under Section 19 . With respect to suits for recovery of money less than Rs 10 lakhs, it is the subordinate courts which would continue to try them. In other words, for a claim of Rs 10 lakhs or more, exclusive jurisdiction has been conferred on the but for any amount less than Rs 10 lakhs, it is the ordinary civil courts which will have jurisdiction. The bifurcation of original jurisdiction between and the subordinate courts is a matter which cannot have any bearing on the validity of the establishment of the . It is only in those which have original jurisdiction that an anomalous situation arises where suits for recovery of money less than Rs 10 lakhs have to be decided by while the have jurisdiction to decide suits for recovery of more than Rs 10 lakhs. This incongruous situation, which can be remedied by divesting itself of the original jurisdiction in regard to such claims and vesting the said jurisdiction with the subordinate courts or vice versa, cannot be a ground for holding that the Act is invalid. ", "xxx xxx xxx ", "30. By virtue of Section 29 of the Act, the provisions of the Second and Third Schedules to the Income Tax Act , 1961 and the Income Tax (Certificate Proceedings) Rules, 1962, have become applicable for the realisation of the dues by the Recovery Officer. Detailed procedure for recovery is contained in these Schedules to the Income Tax Act , including provisions relating to arrest and detention of the defaulter. It cannot, therefore, be said that the Recovery Officer would act in an arbitrary manner. Furthermore, Section 30 , after amendment by the Amendment Act , 2000, gives a right to any person aggrieved by an order of the Recovery Officer, to prefer an appeal to the . Thus now an appellate forum has been provided against any orders of the Recovery Officer which may not be in accordance with law. There is, therefore, sufficient safeguard which has been provided in the event of the Recovery Officer acting in an arbitrary or an unreasonable manner. The provisions of Sections 25 and 28 are, therefore, not bad in law. ", "31. For the aforesaid reasons, while allowing the appeals of and the Banks, we hold that the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 is a valid piece of legislation. As a result thereof, the writ petitions or appeals filed by various parties challenging the validity of the said Act or some of the provisions thereof, are dismissed. It would be open to the parties to raise other contentions on the merits of their cases before the authority constituted under the Act and, only thereafter, should entertain a petition under Articles 226 and/or 227 of the Constitution. Transferred cases stand disposed of accordingly. Parties to bear their own costs.\u201d ", "(iii) Reliance was next placed on ., . The primary question which arose for consideration was the constitutional validity of the Consumer Protection Act , 1986. The challenge was raised on the ground, that was not empowered to establish a hierarchy of courts like , and , as this would constitute a parallel hierarchy of courts, in addition to the courts established under the Constitution, namely, , and . In this behalf the pointed submission was, that could only establish courts, with power to deal with specific subjects, but not such a court which would run parallel to the civil courts. It was sought to be asserted, that even under Articles 323A and 323B of the Constitution, could not enact a legislation, by which it could establish tribunals, in substitution of civil courts including . This, according to those who raised the challenge, would strike at the independence of the judiciary. As against the above assertions, the legislative competence of the and the State , to provide for creation of courts and tribunals, reliance was placed on entries 77, 78 and 79 in List I of the Seventh Schedule, as also, entries 11A and 46 contained in List III of the Seventh Schedule to the Constitution. While examining the challenge raised to the Consumer Protection Act , 1986, on the grounds referred to above, this Court held as under:- ", "\u201c12. A bare perusal of the aforementioned provisions does not leave any manner of doubt as regard the legislative competence of to provide for creation of Special Courts and Tribunals. Administration of justice; constitution and organization of all courts, except [pic]and is squarely covered by Entry 11-A of List III of the Constitution of India. The said entry was originally a part of Entry 3 of List II. By reason of the Constitution (Forty-second Amendment) Act, 1976 and by Section 57(a)(vi) thereof, it was inserted into List III as Item 11-A. ", "13. By virtue of clause (2) of Article 246 of the Constitution, has the requisite power to make laws with respect of constitution of organization of all courts except and . ", "14. The learned counsel appearing on behalf of the petitioners could not seriously dispute the plenary power of to make a law as regard constitution of courts but as noticed supra, merely urged that it did not have the competence to create parallel civil courts. ", "15. The said submission has been made purported to be relying on or on the basis of the following observations made by , J. while delivering a partially dissenting judgment in Special Courts Bill, 1978, In re: (1979) 1 SCC 380 (SCC at p. 455, para 152) \u201c152. The Constitution has thus made ample and effective provision for the establishment of a strong, independent and impartial judicial administration in the country, with the necessary complement of civil and criminal courts. It is not permissible for or to ignore or bypass that scheme of the Constitution by providing for the establishment of a civil or criminal court parallel to a in a State, or by way of an additional or extra or a second , or a court other than a court subordinate to the . Any such attempt would be unconstitutional and will strike at the independence of the judiciary which has so nobly been enshrined in the Constitution and so carefully nursed over the years.\u201d ", "16. The argument of the learned counsel is fallacious inasmuch as the provisions of the said Act are in addition to the provisions of any other law for the time being in force and not in derogation thereof as is evident from Section 3 thereof. ", "17. The provisions of the said Act clearly demonstrate that it was enacted keeping in view the long-felt necessity of protecting the common man from wrongs wherefor the ordinary law for all intent and purport had become illusory. In terms of the said Act, a consumer is entitled to participate in the proceedings directly as a result whereof his helplessness against a powerful business house may be taken care of. ", "18. This in a large number of decisions considered the purport and object of the said Act. By reason of the said statute, quasi-judicial authorities have been created at the district, and Central levels so as to enable a consumer to ventilate his grievances before a forum where justice can be done without any procedural wrangles and hypertechnicalities. ", "19. One of the objects of the said Act is to provide momentum to the consumer movement. is also to be [pic]constituted in terms of Section 4 of the Act to promote and protect the rights of the consumers as noticed hereinbefore. ", "xxx xxx xxx ", "24. In terms of Section 10 , the President of shall be a person who is, or has been, or is qualified to be a District Judge and the shall also consist of two other members who are required to be persons of ability, integrity and standing and have adequate knowledge or experience of, or have shown capacity in dealing with, problems relating to economics, law, commerce, accountancy, industry, public affairs or administration and one of them shall be a woman. The tenure of the members of the District is fixed. ", "25. Section 13 of the said Act lays down a detailed procedure as regards the mode and manner in which the complaints received by are required to be dealt with. Section 14 provides for the directions which can be issued by on arriving at a satisfaction that the goods complained against suffer from any of the defects specified in the complaint [pic]or that any of the allegations contained in the complaint about the deficiencies in services have been proved. ", "26. Section 15 provides for an appeal from the order made by to . ", "27. Section 16 provides for composition of which reads thus: ", "\u201c16. (1) Each State Commission shall consist of,\u2014 ", "(a) a person who is or has been a Judge of , appointed by the State Government, who shall be its President: ", "Provided that no appointment under this clause shall be made except after consultation with the Chief Justice of ; ", "(b) two other members, who shall be persons of ability, integrity and standing and have adequate knowledge or experience of, or have shown capacity in dealing with, problems relating to economics, law, commerce, accountancy, industry, public affairs or administration, one of whom shall be a woman: ", "Provided that every appointment under this clause shall be made by on the recommendation of consisting of the following, namely: ", "(i) President of : Chairman ", "(ii) Secretary of : Member ", "(iii) Secretary in charge of the dealing with consumer affairs in the : Member (2) The salary or honorarium and other allowances payable to, and the other terms and conditions of service of the members of the Commission shall be such as may be prescribed by the Government. (3) Every member of the Commission shall hold office for a term of five years or up to the age of sixty-seven years, whichever is earlier and shall not be eligible for reappointment. ", "(4) Notwithstanding anything contained in sub-section (3), a person appointed as a President or as a member before the commencement of the Consumer Protection (Amendment) Act , 1993, shall continue to hold such office as President or member, as the case may be, till the completion of his term.\u201d The members of are to be selected by , the Chairman whereof would be the President of . ", "28. Section 19 provides for an appeal from a decision of to . Section 20 deals with the composition of , the President whereof would be a person who is or has been a Judge of and such appointment shall be made only upon consultation with the Chief Justice of India. So far as the members of are concerned, the same are also to be made on the recommendation of , the Chairman whereof would be a person who is a Judge of to be nominated by the Chief Justice of India. The tenure of the office of is also fixed by reason of sub-section (3) of Section 20 . ", "29. By reason of the provisions of the said Act, therefore, independent authorities have been created. ", "30. Sections 15 , 19 and 23 provide for the hierarchy of appeals. By reason of sub-sections (4), (5) and (6) of Section 13 , shall have the same powers as are vested in the civil courts for the purposes mentioned therein. Sub-sections (2) and (2-A) of Section 14 mandate that the proceedings shall be conducted by the President of and at least one member thereof sitting together. Only in the event of any difference between them on any point or points, the same is to be referred to the other member for hearing thereon and the opinion of the majority shall be the order of . By reason of Section 18 , the provisions of Sections 12 , 13 and 14 and the rules made thereunder would mutatis mutandis be applicable to the disposal of disputes by . ", "31. Section 23 provides for a limited appeal to from an order made by i.e. when the same is made in exercise of its original power as conferred by sub-clause (i) of clause (a) of Section 21 .\u201d This then, having placed reliance on Bar Association (supra), , AIR 1955 SC 58, and , , concluded as under:- \u201c37. Once it is held that had the legislative competence to enact the said Act, the submissions of the learned counsel that the relevant provisions of the Constitution required amendments must be neglected. ", "38. The scope and object of the said legislation came up for consideration before this Court in , . It was held: (SCC p. 730, para 2) \u201c2. The object of the legislation, as the preamble of the Act proclaims, is \u2018for better protection of the interests of consumers\u2019. During the last few years preceding the enactment there was in this country a marked awareness among the consumers of goods that they were not getting their money\u2019s worth and were being exploited by both traders and manufacturers of consumer goods. The need for consumer redressal fora was, therefore, increasingly felt. Understandably, therefore, legislation was introduced and enacted with considerable enthusiasm and fanfare as a path-breaking benevolent legislation intended to protect the consumer from exploitation by unscrupulous manufacturers and traders of consumer goods. A three-tier fora comprising , and came to be envisaged under the Act for redressal of grievances of consumers.\u201d ", "39. The rights of the parties have adequately been safeguarded by reason of the provisions of the said Act inasmuch as although it provides for an alternative system of consumer jurisdiction on summary trial, they are required to arrive at a conclusion based on reasons. Even when quantifying damages, they are required to make an attempt to serve the ends of justice aiming not only at recompensing the individual but also to bring about a [pic]qualitative change in the attitude of the service provider. Assignment of reasons excludes or at any rate minimizes the chances of arbitrariness and the higher forums created under the Act can test the correctness thereof. ", "40. , and are not manned by lay persons. The President would be a person having judicial background and other members are required to have the expertise in the subjects such as economics, law, commerce, accountancy, industry, public affairs, administration etc. It may be true that by reason of sub- section (2-A) of Section 14 of the Act, in a case of difference of opinion between two members, the matter has to be referred to a third member and, in rare cases, the majority opinion of the members may prevail over the President. But, such eventuality alone is insufficient for striking down the Act as unconstitutional, particularly, when provisions have been made therein for appeal thereagainst to a higher forum. ", "41. By reason of the provisions of the said Act, the power of judicial review of , which is a basic feature of the Constitution, has not been nor could be taken away. ", "xxx xxx xxx ", "49. The question as regards the applicability or otherwise of Articles 323-A and 323-B of the Constitution in the matter of constitution of such Tribunals came up for consideration before this Court in , . This Court therein clearly held that the constitutional provisions vest and , as the case may be, with powers to divest the traditional courts of a considerable portion of their judicial work. It was observed that the and possess legislative competence to effect changes in the original jurisdiction of and apart from the authorisation that flows from Articles 323-A and 323-B in terms of Entries 77, 78, 79 and 95 of List I so far as the is concerned, and in terms of Entry 65 of List II and Entry 46 of List III so far as are concerned. It was further held that power of judicial review being the basic structure of the Constitution cannot be taken away. ", "50. We, therefore, are clearly of the opinion that the said Act cannot be said to be unconstitutional.\u201d The fourth contention: ", "52(i) In response to the fourth contention, namely, the challenge raised by the learned counsel for the petitioners, to the various provisions of the NTT Act, it was the submission of the learned counsel for the respondents, that in view of the submissions advanced in respect of the third contention, it is apparent that the had the legislative competence to enact the NTT Act. It was submitted, that the NTT Act was enacted keeping in mind the parameters laid down by this , by preserving the power of judicial review vested in under Articles 226 and 227 of the Constitution, as also, by preserving the power of judicial review vested in this under Articles 32 and 136 of the Constitution. It is, therefore, submitted that the final word in respect of the instant adjudicatory process, stands preserved with courts of law. And therefore, the submissions advanced at the hands of the learned counsel for the petitioners on the individual provisions of the NTT Act, pertaining to the independence of the adjudicatory process, were being exaggerated out of proportion. ", "(ii) Despite having made the above submissions, the Attorney General for India, was fair and candid in stating, that if this Court felt that there was need to make certain changes in the provisions referred to by the petitioners, he had the instructions to state, that any suggestion made by this Court will be viewed positively, and necessary amendments in the NTT Act would be carried out. ", "The debate, and the consideration: ", "I. Constitutional validity of the NTT Act \u2013 Does the NTT Act violate the \u201cbasic structure\u201d of the Constitution? ", "53. The principal contention advanced at the hands of the learned counsel for the petitioners was premised on the submission, that Article 323B , inserted by the Constitution (Forty-second Amendment) Act 1976, to the extent that it violated the principles of, \u201cseparation of powers\u201d, \u201crule of law\u201d, and \u201cjudicial review\u201d, was liable to be struck down. This striking down was founded on an alleged violation of the \u201cbasic structure\u201d doctrine. Similarly, various provisions of the Act, were sought to be assailed. The provisions of the Act were challenged, on the premise, that they had trappings of executive control, over the adjudicatory process vested with the , and therefore, were liable to be set aside as unconstitutional. ", "54. In the context of the foregoing submissions advanced at the hands of the learned counsel for the petitioners, it is essential for us to examine the exact contours of \u201cjudicial review\u201d, in the framework and scheme, of the concepts of \u201crule of law\u201d and \u201cseparation of powers\u201d, which have been held to constitute the \u201cbasic structure\u201d of the Constitution. And also, the essential ingredients, of an independent adjudicatory process. It is, therefore, that we would travel the ladder of history and law, to determine the exact scope of the \u201cjudicial review\u201d, which constitutes the \u201cbasic structure\u201d of the Constitution. This would lead us to unravel the salient ingredients of an independent adjudicatory process. Based thereon, we will record our conclusions. The analysis: ", "55. Reference must first of all be made to the decision rendered by this Court in , . In the above cited case, this Court was engaged with the validity of the Constitution (Twenty-fourth Amendment) Act, 1971, as also, the Constitution (Twenty-fifth Amendment) Act, 1971. The former Act related to the amendments of Articles 13 and 368 of the Constitution, whereas the latter, pertained to the amendment of Article 31 of the Constitution. The instant judgment was rendered by a constitution bench of 13 Judges. Seven of the Judges expressed the majority view. The observations recorded by this Court recognising \u201cjudicial review\u201d as a component of the \u201cbasic structure\u201d of the Constitution, were made by four Judges. Reference is first of all being made, to the view expressed by , CJ.: ", "\u201c292. The learned Attorney-General said that every provision of the Constitution is essential; otherwise it would not have been put in the Constitution. This is true. But this does not place every provision of the Constitution in the same position. The true position is that every provision of the Constitution can be amended provided in the result the basic foundation and structure of the constitution remains the same. The basic structure may be said to consist of the following features: (1) Supremacy of the Constitution; ", "(2) Republican and Democratic form of Government; ", "(3) Secular character of the Constitution; ", "(4) Separation of powers between the legislature, the executive and the judiciary; ", "(5) Federal character of the Constitution. ", "293. The above structure is built on the basic foundation i.e. the dignity and freedom of the individual. This is of supreme importance. This cannot by any form of amendment be destroyed.\u201d It is also imperative to refer to the view expressed by and , JJ., who delivered a common judgment: ", "\u201c487. .....The Rule of Law has been ensured by providing for judicial review.\u201d. ", "xxx xxx xxx ", "577. \u2026.. Judicial review is undertaken by the courts \u201cnot out of any desire to tilt at legislative authority in a crusader\u2019s spirit, but in discharge of a duty plainly laid down upon them by the Constitution\u201d. The respondents have also contended that to let the court have judicial review over constitutional amendments would mean involving the court in political questions. To this the answer may be given in the words of Lord in v. , 1950 AC 235 at 310,: \u201cThe problem to be solved will often be not so much legal as political, social or economic, yet it must be solved by a Court of law. For where the dispute is, as here, not only between and citizen but between and intervening s on the one hand and citizens and s on the other, it is only the Court that can decide the issue, it is vain to invoke the voice of .\u201d There is ample evidence in the Constitution itself to indicate that it creates a system of checks and balances by reason of which powers are so distributed that none of the three organs it sets up can become so pre- dominant as to disable the others from exercising and discharging powers and functions entrusted to them. Though the Constitution does not lay down the principle of separation of powers in all its rigidity as is the case in the United s Constitution but it envisages such a separation to a degree as was found in \u2019s case, 1965 AC 172. The judicial review provided expressly in our Constitution by means of Articles 226 and 32 is one of the features upon which hinges the system of checks and balances. Apart from that, as already stated, the necessity for judicial decision on the competence or otherwise of an Act arises from the very federal nature of a Constitution (per , L.C. in Attorney-General for the v. , 1914 AC 237 and Ex parte Walsh & Johnson; In re , (1925) 37 CLR 36 at page 58. The function of interpretation of a Constitution being thus assigned to the judicial power of the , the question whether the subject of a law is within the ambit of one or more powers of the conferred by the Constitution would always be a question of interpretation of the Constitution. It may be added that at no stage the respondents have contested the proposition that the validity of a constitutional amendment can be the subject of review by this Court. The Advocate-General of Maharashtra has characterized judicial review as undemocratic. That cannot, however, be so in our Constitution because of the provisions relating to the appointment of Judges, the specific restriction to which the fundamental rights are made subject, the deliberate exclusion of the due process clause in Article 21 and the affirmation in Article 141 that Judges declare but not make law. To this may be added the none too [pic]rigid amendatory process which authorizes amendment by means of 2/3 majority and the additional requirement of ratification. ", "xxx xxx xxx ", "582. The basic structure of the Constitution is not a vague concept and the apprehensions expressed on behalf of the respondents that neither the citizen nor the would be able to understand it are unfounded. If the historical background, the preamble, the entire scheme of the Constitution, relevant provisions thereof including Article 368 are kept in mind there can be no difficulty in discerning that the following can be regarded as the basic elements of the constitutional structure. (These cannot be catalogued but can only be illustrated): ", "(1) The supremacy of the Constitution. ", "(2) Republican and Democratic form of government and sovereignty of the country. ", "(3) Secular and federal character of the Constitution. (4) Demarcation of power between the , the executive and the judiciary. ", "(5) The dignity of the individual secured by the various freedoms and basic rights in Part III and the mandate to build a welfare State contained in Part IV. ", "(6) The unity and the integrity of the Nation.\u201d In this behalf it is also imperative for us to record the observations of , J., who observed as under:- ", "\u201c1104. \u2026..There is no constitutional matter which is not in some way or the other involved with political, social or economic questions, and if the Constitution-makers have vested in this a power of Judicial review, and while so vesting, have given it a prominent place describing it as the heart and soul of the Constitution, we will not be deterred from discharging that duty, merely because the validity or otherwise of the legislation will affect the political or social policy underlying it. The basic approach of this has been, and must always be, that the has the exclusive power to determine the policy and to translate it into law, the constitutionality of which is to be presumed, unless there are strong and cogent reasons for holding that it conflicts with the constitutional mandate. In this regard both the , the executive, as well as the judiciary are bound by the paramount instrument, and, therefore, no court and no Judge will exercise the judicial power dehors that instrument, nor will it function as a supreme legislature above the Constitution. The bona fides of all the three of them has been the basic assumption, and though all of them may be liable to error, it can be corrected in the manner and by the method prescribed under the Constitution and subject to such limitations as may be inherent in the instrument.\u201d Some of the observations of , J., are also relevant to the issue in hand. The same are placed hereunder: ", "\u201c1529. \u2026..The power of judicial review is, however, confined not merely to deciding whether in making the impugned laws the Central or State have acted within the four corners of the legislative lists earmarked for them; the courts also deal with the question as to whether the laws are made in conformity with and not in violation of the other provisions of the Constitution. Our Constitution-makers have provided for fundamental rights in Part III and made them justiciable. As long as some fundamental rights exist and are a part of the Constitution, the power of judicial review has also to be exercised with a view to see that the guarantees afforded by those rights are not contravened. Dealing with draft Article 25 (corresponding to present Article 32 of the Constitution) by which a right is given to move for enforcement of the fundamental rights, Dr speaking in on December 9, 1948 observed: ", "\u201cIf I was asked to name any particular article in this Constitution as the most important an article without which this Constitution would be a nullity \u2014 I could not refer to any other article except this one It is the very soul of the Constitution and the very heart of it and I am glad that the has realised its importance\u201d (Constituent Assembly Debates, Vol VII, p. 953). ", "Judicial review has thus become an integral part of our constitutional system and a power has been vested in and to decide about the constitutional validity of provisions of statutes. Our Constitution postulates rule of law in the sense of supremacy of the Constitution and the laws as opposed to arbitrariness. The vesting of power of exclusion of judicial review in a legislature, including , contemplated by Article 31-C , in my opinion, strikes at the basic structure of the Constitution. The second part of Article 31-C thus goes beyond the permissible limit of what constitutes amendment under Article 368. ", "xxx xxx xxx 1533. The position as it emerges is that it is open to the authority amending the Constitution to exclude judicial review regarding the validity of an existing statute. It is likewise open to the said authority to exclude judicial review regarding the validity of a statute which might be enacted by the legislature in future in respect of a specified subject. In such an event, judicial review is not excluded for finding whether the statute has been enacted in respect of the specified subject. Both the above types of constitutional amendments are permissible under Article 368. What is not permissible, however, is a third type of constitutional amendment, according to which the amending authority not merely excludes judicial review regarding the validity of a statute which might be enacted by the legislature in future in respect of a specified subject but also excludes judicial review for finding whether the statute enacted by the legislature is in respect of the subject for which judicial review has been excluded. ", "xxx xxx xxx 1537. I may now sum up my conclusions relating to power of amendment under Article 368 of the Constitution as it existed before the amendment made by the Constitution (Twenty-fourth Amendment) Act as well as about the validity of the Constitution (Twenty-fourth Amendment) Act, the Constitution (Twenty-fifth Amendment) Act and the Constitution (Twenty- ninth Amendment) Act : ", "(i) Article 368 contains not only the procedure for the amendment of the Constitution but also confers the power of amending the Constitution. ", "(ii) Entry 97 in List I of the Seventh Schedule of the Constitution does not cover the subject of amendment of the Constitution. ", "(iii) The word \u201claw\u201d in Article 13(2) does not include amendment of the Constitution. It has reference to ordinary piece of legislation. It would also in view of the definition contained in clause (a) of Article 13(3) include an ordinance, order, bye-law, rule, regulation, notification, custom or usage having in the territory of India the force of law. ", "xxx xxx xxx (vii) The power of amendment under Article 368 does not include the ", "power to abrogate the Constitution nor does it include the power to alter the basic structure or framework of the Constitution. Subject to the retention of the basic structure or framework of the Constitution, the power of amendment is plenary and includes within itself the power to amend the various articles of the Constitution, including those relating to fundamental rights as well as those which may be said to relate to essential features. No part of a fundamental right can claim immunity from amendatory process by being described as the essence, or core of that right. The power of amendment would also include within itself the power to add, alter or repeal the various articles. ", "xxx xxx xxx (xiv) The second part of Article 31-C contains the seed of national ", "disintegration and is invalid on the following two grounds: [pic](1) It gives a carte blanche to the legislature to make any law violative of Articles 14, 19 and 31 and make it immune from attack by inserting the requisite declaration. Article 31-C taken along with its second part gives in effect the power to the legislature including , to amend the Constitution in important respects. (2) The legislature has been made the final authority to decide as to whether the law made by it is for the objects mentioned in Article 31-C. The vice of second part of Article 31-C lies in the fact that even if the law enacted is not for the object mentioned in Article 31-C , the declaration made by the legislature precludes a party from showing that the law is not for that object and prevents a court from going into the question as to whether the law enacted is really for that object. The exclusion by the legislature, including , of even that limited judicial review strikes at the basic structure of the Constitution. The second part of Article 31-C goes beyond the permissible limit of what constitutes amendment under Article 368. ", "The second part of Article 31-C can be severed from the remaining part of Article 31-C and its invalidity would not affect the validity of the remaining part. I would, therefore, strike down the following words in Article 31-C -- ", "\u201cand no law containing a declaration that it is for giving effect to such policy shall be called in question in any court on the ground that it does not give effect to such policy\u201d.\u201d 56(i) The next judgment having a bearing on the subject is , 1975 Supp. SCC 1. In the instant judgment, this Court examined the constitutional validity of the Constitution (Thirty-ninth Amendment) Act, 1975. The issue under reference included the insertion of Article 329A ( and more particularly , the second clause thereof ), which had the effect of taking out from the purview of \u201cjudicial review\u201d, the validity of the election of a person who was holding, either the office of the Prime Minister or of the Speaker, or had come to be appointed/chosen as the Prime Minister or the Speaker, after such election. Insofar as the instant aspect of the matter is concerned, it would be relevant to mention, that the election of the appellant from the Rae Bareli constituency in the General Parliamentary Elections of 1971, was set aside by at Allahabad (hereinafter referred to as, ), on 12.6.1975. The appellant had assailed the order passed by before this Court. During the pendency of the above appeal, on 10.8.1975, the Constitution (Thirty-ninth Amendment) Act was passed, which introduced two new Articles, namely, Articles 71 and 329A of the Constitution. The controversy arising out of the above referred appeal, therefore, virtually came to be rendered infructuous. It was, by way of a cross-appeal, that the constitutional validity of the amended provisions was assailed. ", "(ii) In the above cross-appeal, it was asserted at the hands of the respondent, that \u201cjudicial review\u201d was an essential feature of the \u201cbasic structure\u201d of the Constitution. This assertion was under the doctrine of \u201cseparation of powers\u201d. The pointed submission at the hands of the learned counsel for the respondent was, that \u201cjudicial review\u201d, in matters of election was imperative. The issue canvassed was, that \u201cjudicial review\u201d would ensure free, fair and pure elections. It was sought to be asserted, that the power of \u201cjudicial review\u201d in the context referred to hereinabove, was available both under the American Constitution, as also, the Australian Constitution. And therefore, even though there was no express/clear provision on the subject under the Indian Constitution, since the executive, the legislature and the judiciary were earmarked respective spheres of activity (by compartmentalising them into separate parts and chapters), the charge and onus of \u201cjudicial review\u201d fell within the sphere of activity of the judiciary. It was sought to be asserted, that under Article 136 of the Constitution, all tribunals and courts are amenable to the jurisdiction of this Court. The corollary sought to be drawn was, that if under clause 4 of Article 329A of the Constitution, the power of \u201cjudicial review\u201d was taken away, it would amount to a destruction of the \u201cbasic structure\u201d of the Constitution. The relevant observations made in the instant judgment rendered by a constitution bench of 5 Judges of this Court are being extracted hereunder. First and foremost reference may be made to the following observations of , CJ:- ", "\u201c16. It should be stated here that the hearing has proceeded on the assumption that it is not necessary to challenge the majority view in case, (1973) 4 SCC 225. The contentions of the respondent are these: First, under Article 368 only general principles governing the organs of the and the basic principles can be laid down. An amendment of the Constitution does not contemplate any decision in respect of individual cases. Clause (4) of Article 329-A is said to be exercise of a purely judicial power which is not included in the constituent power conferred by Article 368. ", "xxx xxx xxx ", "20. Fifth, clause (4) destroys not only judicial review but also separation of power. The order of declaring the election to be void is declared valid (lie void). The cancellation of the judgment is denial of political justice which is the basic structure of the Constitution. ", "xxx xxx xxx ", "52. Judicial review in election disputes is not a compulsion. Judicial review of decisions in election disputes may be entrusted by law to a judicial tribunal. If it is to a tribunal or to the judicial review will be attracted either under the relevant law providing for appeal to this or Article 136 may be attracted. Under Article 329(b) the contemplated law may vest the power to entertain election petitions in the itself which may determine the dispute by a resolution after receiving a report from a special committee. In such cases judicial review may be eliminated without involving amendment of the Constitution. \u2026.. If judicial review is excluded the court is not in a position to conclude that principles of equality have been violated. ", "xxx xxx xxx ", "153. The contentions of the respondent that the Amendment Act s of 1974 and 1975 are subject to basic features or basic structure or basic framework fails on two grounds. First, legislative measures are not subject to the theory of basic features or basic structure or basic framework. Second, the majority view in case (supra) is that the Twenty- ninth Amendment which put the two statutes in the Ninth Schedule and Article 31-B is not open to challenge on the ground of either damage to or destruction of basic features, basic structure or basic framework or on the ground of violation of fundamental rights.\u201d The views expressed by J. are now being reproduced below:- \u201c175. The proposition that the power of amendment under Article 368 does not enable to alter the basic structure of framework of the Constitution was laid down by this Court by a majority of 7 to 6 in the case of , (1973) 4 SCC ", "225. Apart from other reasons which were given in some of the judgments of the learned Judges who constituted the majority, the majority dealt with the connotation of the word \u201camendment\u201d. It was held that the words \u201camendment of the Constitution\u201d in Article 368 could not have the effect of destroying or abrogating the basic structure of the Constitution. Some of us who were parties to that case took a different view and came to the conclusion that the words \u201camendment of the Constitution\u201d in Article 368 did not admit of any limitation. Those of us who were in the minority in case (supra) may still hold the same view as was given expression to in that case. For the purpose of the present case, we shall have to proceed in accordance with the law as laid down by the majority in that case. ", "176. Before dealing with the question as to whether the impugned amendment affects the basic structure of the Constitution, I may make it clear that this is not concerned with the wisdom behind or the propriety of the impugned constitutional amendment. These are matters essentially for those who are vested with the authority to make the constitutional amendment. All that this is concerned with is the constitutional validity of the impugned amendment. ", "xxx xxx xxx ", "210. It has been argued in support of the constitutional validity of clause (4) that as a result of this amendment, the validity of one election has been preserved. Since the basic structure of the Constitution, according to the submission, continues to be the same, clause (4) cannot be said to be an impermissible piece of constitutional amendment. The argument has a seeming plausibility about it, but a deeper reflection would show that it is vitiated by a basic fallacy. Law normally connotes a rule or norm which is of general application. It may apply to all the persons or class of persons or even individuals of a particular description. Law prescribes the abstract principles by the application of which individual cases are decided. Law, however, is not what called \u201ca sentence\u201d. According to , law, as distinguished from laws, is the system of authoritative materials for grounding or guiding judicial and administrative action recognised or established in a politically organized society (see p. 106, Jurisprudence, Vol. III). Law is not the same as judgment. Law lays down the norm in abstract terms with a coercive power and sanction against those guilty of violating the norm, while judgment represents the decision arrived at by the application of law to the concrete facts of a case. Constitutional law relates to the various organs of a ; it deals with the structure of the Government, the extent of distribution of its powers and the modes and principles of its operation. The Constitution of India is so detailed that some of the matters which in a brief Constitution like that of the United s of America are dealt with by statutes form the subject-matter of various articles of our Constitution. There is, however, in a constitutional law, as there is in the very idea of law, some element of generality or general application. It also carries with it a concept of its applicability in future to situations which may arise in that context. If there is amendment of some provision of the Constitution and the amendment deals with matters which constitute constitutional law, in the normally accepted sense, the court while deciding the question of the validity of the amendment would have to find out, in view of the majority opinion in case (supra), as to whether the amendment affects the basic structure of the Constitution. The constitutional amendment contained in clause (4) with which we are concerned in the present [pic]case is, however, of an altogether different nature. Its avowed object is to confer validity on the election of the appellant to in 1971 after that election had been declared to be void by and an appeal against the judgment of was pending in this Court. In spite of our query, we were not referred to any precedent of a similar amendment of any Constitution of the world. The uniqueness of the impugned constitutional amendment would not, however, affect its validity. If the constituent authority in its wisdom has chosen the validity of a disputed election as the subject-matter of a constitutional amendment, this Court cannot go behind that wisdom. All that this Court is concerned with is the validity of the amendment. I need not go into the question as to whether such a matter, in view of the normal concept of constitutional law, can strictly be the subject of a constitutional amendment. I shall for the purpose of this case assume that such a matter can validly be the subject-matter of a constitutional amendment. The question to be decided is that if the impugned amendment of the Constitution violates a principle which is part of the basic structure of the Constitution, can it enjoy immunity from an attack on its validity because of the fact that for the future, the basic structure of the Constitution remains unaffected. The answer to the above question, in my opinion, should be in the negative. What has to be seen in such a matter is whether the amendment contravenes or runs counter to an imperative rule or postulate which is an integral part of the basic structure of the Constitution. If so, it would be an impermissible amendment and it would make no difference whether it relates to one case or a large number of cases. If an amendment striking at the basic structure of the Constitution is not permissible, it would not acquire validity by being related only to one case. To accede to the argument advanced in support of the validity of the amendment would be tantamount to holding that even though it is not permissible to change the basic structure of the Constitution, whenever the authority concerned deems it proper to make such an amendment, it can do so and circumvent the bar to the making of such an amendment by confining it to one case. What is prohibited cannot become permissible because of its being confined to one matter.\u201d On the issue in hand, views were as under:- \u201c318. The major problem of human society is to combine that degree of liberty without which law is tyranny with that degree of law without which liberty becomes licence; and, the difficulty has been to discover the practical means of achieving this grand objective and to find the opportunity for applying these means in the ever-shifting tangle of human affairs. A large part of the effort of man over centuries has been expended in seeking a solution of this great problem. A region of law, in contrast to the tyranny of power, can be achieved only through separating appropriately the several powers of the Government. If the lawmakers should also be the constant administrators and dispensers of law and justice, then, the people would be left without a remedy in case of injustice since no appeal can lie under the fiat against such a supremacy. And, in this age-old search of political philosophers for the secret of sound Government, combined with individual liberty, it was who first saw the light. He was the first among the political philosophers who saw the necessity of separating judicial power from the executive and legislative branches of Government. was the first to conceive of the three functions of Government as exercised by three organs, each juxtaposed against others. [pic]He realised that the efficient operation of Government involved a certain degree of overlapping and that the theory of checks and balances required each organ to impede too great an aggrandizement of authority by the other two powers. As says, convinced the world that he had discovered a new constitutional principle which was universally valid. The doctrine of separation of governmental powers is not a mere theoretical, philosophical concept. It is a practical, work-a-day principle. The division of Government into three branches does not imply, as its critics would have us think, three watertight compartments. Thus, legislative impeachment of executive officers or judges, executive veto over legislation, judicial review of administrative or legislative actions are treated as partial exceptions which need explanation. (See generally: \u201cthe Doctrine of Separation of Powers and its present day significance\u201d by .) xxx xxx xxx ", "343. I think clause (4) is bad for the reasons which I have already summarised. Clauses (1) to (3) of Article 329-A are severable but I express no opinion on their validity as it is not necessary for deciding this case. ", "xxx xxx xxx ", "361. I therefore hold that these Acts are not liable to be challenged on any of the grounds argued by Counsel.\u201d ", "57. Insofar as the third judgment in the series of judgments is concerned, reference may be made to ., , as also, ., . Insofar as the former of the above two judgments is concerned, the same delineates the pointed controversy dealt with by a constitution bench of 5 Judges of this Court. The issue adjudicated upon, pertained to the constitutional validity of the Constitution (Forty-second Amendment) Act, 1976, and more particularly, Sections 4 and 55 thereof, whereby Articles 31C and 368 of the Constitution, came to be amended. The majority view was expressed in the ratio of 4:1, J. (as he then was) having rendered the dissent. The majority arrived at the conclusion, that Section 4 of the Constitution (Forty-second Amendment) Act, 1976 was beyond the amending power of the and was void, as it had the effect of violating the basic or essential features of the Constitution and destroying the \u201cbasic structure\u201d of the Constitution, by a total exclusion of a challenge to any law, even on the ground that it was inconsistent with, or had taken away, or had abridged any of the rights, conferred by Articles 14 or 19 of the Constitution. Likewise, Section 55 of the Constitution (Forty-second Amendment) Act was struck down as unconstitutional, as the same was beyond the amending power of the . Relevant observations recorded in the instant judgment pertaining to the issue in hand, are being extracted hereunder. The opinion expressed by , CJ, , and JJ. on the subject in hand, was to the following effect:- ", "\u201c68. We must \u2026 mention, what is perhaps not fully realised, that Article 31-C speaks of laws giving effect to the \u201cpolicy of the \u201d, \u201ctowards securing all or any of the principles laid down in Part IV\u201d. In the very nature of things it is difficult for a court to determine whether a particular law gives effect to a particular policy. Whether a law is adequate enough to give effect to the policy of the towards securing a directive principle is always a debatable question and the courts cannot set aside the law as invalid merely because, in their opinion, the law is not adequate enough to give effect to a certain policy. In fact, though the clear intendment of Article 31-C is to shut out all judicial review, the argument of the learned Additional Solicitor-General calls for a doubly or trebly extensive judicial review than is even normally permissible to the courts. Be it remembered that the power to enquire into the question whether there is a direct and reasonable nexus between the provisions of a law and a directive principle cannot confer upon the courts the power to sit in judgment over the policy itself of the . At the highest, courts can, under Article 31-C , satisfy themselves as to the identity of the law in the sense whether it bears direct and reasonable nexus with a directive principle. If the court is satisfied as to the existence of such nexus, the inevitable consequence provided for by Article 31-C must follow. Indeed, if there is one topic on which all the 13 Judges in , , were agreed, it is this: that the only question open to judicial review under the unamended Article 31-C was whether there is a direct and reasonable nexus between the impugned law and the provisions of Article 39(b) and (c) Reasonableness is evidently regarding the nexus and not regarding the law. It is therefore impossible to accept the contention that it is open to the courts to undertake the kind of enquiry suggested by the Additional Solicitor General. The attempt therefore to drape Article 31- C into a democratic outfit under which an extensive judicial review would be permissible must fail. ", "xxx xxx xxx [pic]73. It was finally urged by the learned Attorney General that if we uphold the challenge to the validity of Article 31-C , the validity of clauses (2) to (6) of Article 19 will be gravely imperilled because those clauses will also then be liable to be struck down as abrogating the rights conferred by Article 19(1) which are an essential feature of the Constitution. We are unable to accept this contention. Under clauses (2) to (6) of Article 19 , restrictions can be imposed only if they are reasonable and then again, they can be imposed in the interest of a stated class of subjects only. It is for the courts to decide whether restrictions are reasonable and whether they are in the interest of the particular subject. Apart from other basic dissimilarities, Article 31-C takes away the power of judicial review to an extent which destroys even the semblance of a comparison between its provisions and those of clauses (2) to (6) of Article 19. Human ingenuity, limitless though it may be, has yet not devised a system by which the liberty of the people can be protected except through the intervention of courts of law. ", "xxx xxx xxx ", "75. These then are our reasons for the Order ( , ) which we passed on May 9, 1980 to the following effect: (SCC pp. 592-593, paras 1 & 2) \u201cSection 4 of the Constitution (Forty-second Amendment) Act is beyond the amending power of the and is void since it damages the basic or essential features of the Constitution and destroys its basic structure by a total exclusion of challenge to any law on the ground that it is inconsistent with, or takes away or abridges any of the rights conferred by Article 14 or Article 19 of the Constitution, if the law is for giving effect to the policy of the towards securing all or any of the principles laid down in Part IV of the Constitution. ", "Section 55 of the Constitution (Forty-second Amendment) Act is beyond the amending power of the and is void since it removes all limitations on the power of the to amend the Constitution and confers power upon it to amend the Constitution so as to damage or destroy its basic or essential features or its basic structure.\u201d In order to appreciate the minority view on the issue, reference may be made to the following observations of , J.:- \u201c87. It is a fundamental principle of our constitutional scheme, and I have pointed this out in the preceding paragraph, that every organ of the , every authority under the Constitution, derives its power from the Constitution and has to act within the limits of such power. But then the question arises as to which authority must decide what are the limits on the power conferred upon each organ or instrumentality of the and whether such limits are transgressed or exceeded. Now there are three main departments of the amongst which the powers of government are divided; the executive, the legislature and the judiciary. Under our Constitution we have no rigid separation of powers as in the United s of America, but there is a broad demarcation, though, having regard to the complex nature of governmental functions, certain degree of overlapping is inevitable. The reason for this broad separation of powers is that \u201cthe concentration of powers in any one organ may\u201d to quote the words of , J., (as he then was) in case, 1975 Supp SCC 1, \u201cby upsetting that fine balance between the three organs, destroy the fundamental premises of a democratic government to which we are pledged\u201d. Take for example, a case where the executive which is in charge of administration acts to the prejudice of a citizen and a question arises as to what are the powers of the executive and whether the executive has acted within the scope of its powers. Such a question obviously cannot be left to the executive to decide and for two very good reasons. First, the decision of the question would depend upon the interpretation of the Constitution and the laws and this would pre-eminently be a matter fit to be decided by the judiciary, because it is the judiciary which alone would be possessed of expertise in this field and secondly, the constitutional and legal protection afforded to the citizen would become illusory, if it were left to the executive to determine the legality of its own action. So also if the legislature makes a law and a dispute arises whether in making the law the legislature has acted outside the area of its legislative competence or the law is violative of the fundamental rights or of any other provisions of the Constitution, its resolution cannot, for the same reasons, be left to the determination of the legislature. The Constitution has, therefore, created an independent machinery for resolving these disputes and this independent machinery is the judiciary which is vested with the power of judicial review to determine the legality of executive action and the validity of legislation passed by the legislature. It is the solemn duty of the judiciary under the Constitution to keep the different organs of the such as the executive and the legislature within the limits of the power conferred upon them by the Constitution. This power of judicial review is conferred on [pic]the judiciary by Articles 32 and 226 of the Constitution. Speaking about draft Article 25 , corresponding to present Article 32 of the Constitution, Dr , the principal architect of our Constitution, said in on December 9, 1948: \u201cIf I was asked to name any particular Article in this Constitution as the most important \u2014 an Article without which this Constitution would be a nullity \u2014 I could not refer to any other Article except this one. It is the very soul of the Constitution and the very heart of it and I am glad that the has realised its importance. (CAD, Vol. 7, p.953)\u201d It is a cardinal principle of our Constitution that no one howsoever highly placed and no authority however lofty can claim to be the sole judge of its power under the Constitution or whether its action is within the confines of such power laid down by the Constitution. The judiciary is the interpreter of the Constitution and to the judiciary is assigned the delicate task to determine what is the power conferred on each branch of government, whether it is limited, and if so, what are the limits and whether any action of that branch transgresses such limits. It is for the judiciary to uphold the constitutional values and to enforce the constitutional limitations. That is the essence of the rule of law, which inter alia requires that \u201cthe exercise of powers by the government whether it be the legislature or the executive or any other authority, be conditioned by the Constitution and the law\u201d. The power of judicial review is an integral part of our constitutional system and without it, there will be no government of laws and the rule of law would become a teasing illusion and a promise of unreality. I am of the view that if there is one feature of our Constitution which, more than any other, is basic and fundamental to the maintenance of democracy and the rule of law, it is the power of judicial review and it is unquestionably, to my mind, part of the basic structure of the Constitution. Of course, when I say this I should not be taken to suggest that effective alternative institutional mechanisms or arrangements for judicial review cannot be made by . But what I wish to emphasise is that judicial review is a vital principle of our Constitution and it cannot be abrogated without affecting the basic structure of the Constitution. If by a constitutional amendment, the power of judicial review is taken away and it is provided that the validity of any law made by the legislature shall not be liable to be called in question on any ground, even if it is outside the legislative competence of the legislature or is violative of any fundamental rights, it would be nothing short of subversion of the Constitution, for it would make a mockery of the distribution of legislative powers between the Union and the s and render the fundamental rights meaningless and futile. So also if a constitutional amendment is made which has the effect of taking away the power of judicial review and providing that no amendment made in the Constitution shall be liable to be questioned on any ground, even if such amendment is violative of the basic structure and, therefore, outside the amendatory power of , it would be making sole judge of the constitutional validity of what it has done and that would, in effect and substance, nullify the limitation on the amending power of and affect the basic structure of the Constitution. The conclusion must therefore inevitably follow that clause (4) of Article 368 is unconstitutional and void as damaging the basic structure of the Constitution. ", "88. That takes us to clause (5) of Article 368. This clause opens with the words \u201cfor the removal of doubts\u201d and proceeds to declare that there shall be no limitation whatever on the amending power of under [pic] Article 368. It is difficult to appreciate the meaning of the opening words \u201cfor the removal of doubts\u201d because the majority decision in case (supra) clearly laid down and left no doubt that the basic structure of the Constitution was outside the competence of the amendatory power of and in case (supra), all the judges unanimously accepted theory of the basic structure as a theory by which the validity of the amendment impugned before them, namely, Article 329-A(4) was to be judged. Therefore, after the decisions in case (supra) and case (supra), there was no doubt at all that the amendatory power of was limited and it was not competent to to alter the basic structure of the Constitution and clause (5) could not remove the doubt which did not exist. What clause (5) really sought to do was to remove the limitation on the amending power of and convert it from a limited power into an unlimited one. This was clearly and indubitably a futile exercise on the part of . I fail to see how which has only a limited power of amendment and which cannot alter the basic structure of the Constitution can expand its power of amendment so as to confer upon itself the power of repeal or abrogate the Constitution or to damage or destroy its basic structure. That would clearly be in excess of the limited amending power possessed by . The Constitution has conferred only a limited amending power on so that it cannot damage or destroy the basic structure of the Constitution and cannot by exercise of that limited amending power convert that very power into an absolute and unlimited power. If it were permissible to to enlarge the limited amending power conferred upon it into an absolute power of amendment, then it was meaningless to place a limitation on the original power of amendment. It is difficult to appreciate how having a limited power of amendment can get rid of the limitation by exercising that very power and convert it into an absolute power. Clause (5) of Article 368 which sought to remove the limitation on the amending power of by making it absolute must therefore be held to be outside the amending power of . There is also another ground on which the validity of this clause can be successfully assailed. This clause seeks to convert a controlled Constitution into an uncontrolled one by removing the limitation on the amending power of which, as pointed out above, is itself an essential feature of the Constitution and it is therefore violative of the basic structure. I would in the circumstances hold clause (5) of Article 368 to be unconstitutional and void.\u201d ", "58. Reference may now be made to another decision of this Court rendered by a bench of 7 Judges, namely, , 1981 (Supp.) SCC 87. , J. (as he then was) opined as under:- ", "\u201cConcept of Independence of the Judiciary ", "27. Having disposed of the preliminary objection in regard to locus standi of the petitioners, we may now proceed to consider the questions which arise for determination in these writ petitions. The questions are of great constitutional significance affecting the principle of independence of the judiciary which is a basic feature of the Constitution and we would therefore prefer to begin the discussion by making a few prefatory remarks highlighting what the true function of the judiciary should be in a country like India which is marching along the road to social justice with the banner of democracy and the rule of law, for the principle of independence of the judiciary is not an abstract conception but it is a living faith which must derive its inspiration from the constitutional charter and its nourishment and sustenance from the constitutional values. It is necessary for every Judge to remember constantly and continually that our Constitution is not a non-aligned national charter. It is a document of social revolution which casts an obligation on every instrumentality including the judiciary, which is a separate but equal branch of the , to transform the status quo ante into a new human order in which justice, social, economic and political will inform all institutions of national life and there will be equality of status and opportunity for all. \u2026..Now this approach to the judicial function may be alright for a stable and static society but not for a society pulsating with urges of gender justice, worker justice, minorities justice, dalit justice and equal justice, between chronic unequals. Where the contest is between those who are socially or economically unequal, the judicial process may prove disastrous from the point of view of social justice, if the Judge adopts a merely passive or negative role and does not adopt a positive and creative approach. The judiciary cannot remain a mere bystander or spectator but it must become an active participant in the judicial process ready to use law in the service of social justice through a pro-active goal-oriented approach. But this cannot be achieved unless we have judicial cadres who share the fighting faith of the Constitution and who are imbued with the constitutional values. The necessity of a judiciary which is in tune with the social philosophy of the Constitution has nowhere been better emphasised than in the words of Justice which we quote: \u201cAppointment of Judges is a serious process where judicial expertise, legal learning, life\u2019s experience and high integrity are components, but above all are two indispensables \u2014 social philosophy in active unison with the socialistic articles of the Constitution, and second, but equally important, built-in resistance to pushes and pressures by class interests, private prejudices, government threats and blandishments, party loyalties and contrary economic and politicial ideologies projecting into pronouncements. (, November 22, 1980)\u201d Justice goes on to say in his inimitable style: \u201cJustice approvingly quoted President \u2019s stress on the social philosophy of the Judges, which shakes and shapes the course of a nation and, therefore, the choice of Judges for the higher Courts which makes and declares the law of the land, must be in tune with the social philosophy of the Constitution. Not mastery of the law alone, but social vision and creative craftsmanship are important inputs in successful justicing. (, November 22, 1980)\u201d What is necessary is to have Judges who are prepared to fashion new tools, forge new methods, innovate new strategies and evolve a new jurisprudence, who are judicial statesmen with a social vision and a creative faculty and[pic] who have, above all, a deep sense of commitment to the Constitution with an activist approach and obligation for accountability, not to any party in power nor to the opposition nor to the classes which are vociferous but to the half-hungry millions of India who are continually denied their basic human rights. We need Judges who are alive to the socio- economic realities of Indian life, who are anxious to wipe every tear from every eye, who have faith in the constitutional values and who are ready to use law as an instrument for achieving the constitutional objectives. This has to be the broad blueprint of the appointment project for the higher echelons of judicial service. It is only if appointments of Judges are made with these considerations weighing predominantly with the appointing authority that we can have a truly independent judiciary committed only to the Constitution and to the people of India. The concept of independence of the judiciary is a noble concept which inspires the constitutional scheme and constitutes the foundation on which rests the edifice of our democratic polity. If there is one principle which runs through the entire fabric of the Constitution, it is the principle of the rule of law and under the Constitution, it is the judiciary which is entrusted with the task of keeping every organ of the within the limits of the law and thereby making the rule of law meaningful and effective. It is to aid the judiciary in this task that the power of judicial review has been conferred upon the judiciary and it is by exercising this power which constitutes one of the most potent weapons in armory of the law, that the judiciary seeks to protect the citizen against violation of his constitutional or legal rights or misuse or abuse of power by the or its officers. The judiciary stands between the citizen and the as a bulwark against executive excesses and misuse or abuse of power by the executive and therefore it is absolutely essential that the judiciary must be free from executive pressure or influence and this has been secured by the Constitution-makers by making elaborate provisions in the Constitution to which detailed reference has been made in the judgments in , . But it is necessary to remind ourselves that the concept of independence of the judiciary is not limited only to independence from executive pressure or influence but it is a much wider concept which takes within its sweep independence from many other pressures and prejudices. It has many dimensions, namely, fearlessness of other power centres, economic or political, and freedom from prejudices acquired and nourished by the class to which the Judges belong. If we may again quote the eloquent words of Justice : ", "\u201cIndependence of the is not genuflexion; nor is it opposition to every proposition of Government. It is neither made to Opposition measure nor Government\u2019s pleasure. (, November 22, 1980) The tycoon, the communalist, the parochialist, the faddist, the extremist and radical reactionary lying coiled up and subconsciously [pic]shaping judicial mentations are menaces to judicial independence when they are at variance with Parts III and IV of the Paramount Parchment.\u201d Judges should be of stern stuff and tough fibre, unbending before power, economic or political, and they must uphold the core principle of the rule of law which says, \u201cBe you ever so high, the law is above you.\u201d This is the principle of independence of the judiciary which is vital for the establishment of real participatory democracy, maintenance of the rule of law as a dynamic concept and delivery of social justice to the vulnerable sections of the community. It is this principle of independence of the judiciary which we must keep in mind while interpreting the relevant provisions of the Constitution.\u201d , J., on the issue of \u201cjudicial review\u201d and the \u201cbasic structure\u201d, opined as under:- ", "\u201c332. It would appear that our Constitution has devised a wholesome and effective mechanism for the appointment of Judges which strikes a just balance between the judicial and executive powers so that while the final appointment vests in the highest authority of the executive, the power is subject to a mandatory consultative process which by convention is entitled to great weight by the President. Apart from these safety valves, checks and balances at every stage, where the power of the President is abused or misused or violates any of the constitutional safeguards it is always subject to judicial review. The power of judicial review, which has been conceded by the Constitution to the judiciary, is in our opinion the safest possible safeguard not only to ensure independence of judiciary but also to prevent it from the vagaries of the executive. Another advantage of the method adopted by our Constitution is that by vesting the entire power in the President, the following important elements are introduced: (1) a popular element in the matter of administration of justice, (2) linking with judicial system the dynamic goals of a progressive society by subjecting the principles of governance to be guided by the Directive Principles of State Policy, (3) in order to make the judiciary an effective and powerful machinery, the Constitution contains a most onerous and complicated system by which Judges can be removed under Article 124(4 ), which in practice is almost an impossibility, (4) in order to create and subserve democratic processes the power of appointment of the judiciary in the executive has been so vested that the head of the executive which functions through , which is a purely elected body, is made accountable to the people. ", "xxx xxx xxx ", "336. This Court has in several cases held that the condition of consultation which the Governor has to exercise implies that he would have to respect the recommendations of and cannot turn it down without cogent reasons and even if he does so, it is manifest that his order is always subject to judicial review on the ground of mala fide or exceeding his jurisdiction. ", "xxx xxx xxx ", "345. This, therefore, disposes of all the contentions of the counsel for the parties so far as the various aspects of interpretation of Article 222 are concerned. On a consideration, therefore, of the facts, circumstances and authorities the position is as follows: ", "(1) that Article 222 expressly excludes \u2018consent\u2019 and it is not possible to read the word \u2018consent\u2019 into Article 222 and thereby whittle down the power conferred on the President under this Article, (2) that the transfer of a Judge or a C.J. of under Article 222 must be made in public interest or national interest, (3) that non-consensual transfer does not amount to punishment or involve any stigma, (4) that in suitable cases where mala fide is writ large on the face of it, an order of transfer made by the President would be subject to judicial review, (5) that the transfer of a Judge from one to another does not amount to a first or fresh appointment in any sense of the term, (6) that a transfer made under Article 222 after complying with the conditions and circumstances mentioned above does not mar or erode the independence of judiciary. ", "xxx xxx xxx ", "402. It has been vehemently argued by Mr. as also by Mr. who followed him that their main concern is that independence of judiciary should be maintained at all costs. Indeed, if they are really concerned that we should build up an independent judiciary then it is absolutely essential that new talents from outside should be imported in either to man it or to head it so that they may generate much greater confidence in the people than the local Judges. The position of a C.J. is indeed a very high constitutional position and our Constitution contains sufficient safeguards to protect both his decision-making process and his tenure. It is a well-known saying that power corrupts and absolute power corrupts absolutely. As man is not infallible, so is a Chief Justice, though a person holding a high judicial post is likely to be incorruptible because of the quality of sobriety and restraint that the judicial method contains. Even so, if a C.J. is from outside the , the chances of his misusing his powers are reduced to the absolute minimum. We have pointed out that the power to formulate or evolve this policy clearly lies within the four-corners of Article 222 itself which contains a very wide power conditioned only by consultation with C.J.I. who is the highest judicial authority in the country. It is always open to the President, which in practice means , to lay down a policy, norms and guidelines according to which the presidential powers are to be exercised and once these norms are followed, the powers of the President would be beyond judicial review.\u201d On the issue in hand, , J. expressed the following view:- ", "\u201c624. As regards the constitutional convention or practice and the undertaking which have been pressed into service in relation to recruits as Additional Judges for basing their right to be considered for their continuance on the expiry of their initial term, the learned Attorney- General appearing for raised a two fold contention. Regarding the former he urged that a constitutional convention or practice, howsoever wholesome, cannot affect, alter or control the plain meaning of Article 224(1) which according to him gives absolute power and complete discretion to the President in the matter of continuance of sitting Additional Judges on the expiry of their initial term, the pendency of arrears being relevant only for deciding whether or not Additional Judges should be appointed and not relevant with regard to a particular person to be appointed. As regards the undertaking he pointed out that the usual undertaking obtained from a Member of the in all High \u2014 and for that matter even the additional undertaking that is being obtained in if properly read will show that it merely creates a binding obligation on the concerned Member of the but does not create any [pic]obligation or commitment on the part of the appointing authority to make the offer of permanent Judgeship to him. It is difficult to accept either of these contentions of the learned Attorney General. It was not disputed before us that constitutional conventions and practices have importance under unwritten as well as written Constitutions and the position that conventions have a role to play in interpreting articles of a Constitution is clear from several decided cases. , , Chief Justice observed thus: (SCC p. 64, para 3) \u201cIt was said that we must interpret Article 75(3) according to its own terms regardless of the conventions that prevail in the United Kingdom. If the words of an Article are clear, notwithstanding any relevant convention, effect will no doubt be given to the words. But it must be remembered that we are interpreting a Constitution and not an Act of Parliament, a Constitution which establishes a Parliamentary system of Government with a . In trying to understand one may well keep in mind the conventions prevalent at the time the Constitution was framed.\u201d , , also the importance of a constitutional convention or practice by way of crystallising the otherwise vague and loose content of a power to be found in certain article has been emphasised. , AIR 1966 SC 447, the entire interpretation of the concept of \u2018vesting of control\u2019 over District and subordinate thereto in was animated by conventions and practices having regard to the history, object and purpose that lay behind the group of relevant articles, the principal purpose being, the securing of the independence of the subordinate judiciary. It is true that no constitutional convention or practice can affect, alter or control the operation of any article if its meaning is quite plain and clear but here Article 224(1) merely provides for situations when Additional Judges from duly qualified persons could be appointed to and at the highest reading the article with Section 14 of the General Clauses Act it can be said that the power conferred by that article may be exercised from time to time as occasion requires but on the question as to whether when the occasion arises to make appointment on expiry of the term of a sitting Additional Judge whether he should be continued or a fresher or outsider could be appointed by ignoring the erstwhile incumbent even when arrears continue to obtain in that the article is silent and not at all clear and hence the principle invoked by the learned Attorney-General will not apply. On the other hand, it will be proper to invoke in such a situation the other well-settled principle that in construing a constitutional provision the implications which arise from the structure of the Constitution itself or from its scheme may legitimately be made and looking at Article 224(1) from this angle a wholesome constitutional convention or practice that has grown because of such implications will have to be borne in mind especially when it serves[pic]to safeguard one of the basic features which is the cardinal faith underlying our Constitution, namely, independence of the judiciary. In other words a limitation on the otherwise absolute power and discretion contained in Article 224(1) is required to be read into it because of the clear implication arising from the said cardinal faith which forms a fundamental pillar supporting the basic structure of the Constitution, as otherwise the exercise of the power in the absolute manner as suggested will be destructive of the same. That it is not sound approach to embark upon \u2018a strict literal reach\u2019 of any constitutional provision in order to determine its true ambit and effect is strikingly illustrated in the case of Article 368 which came up for consideration before this Court in case, , where this Court held that the basic or essential features of the Constitution do act as fetters or limitations on the otherwise wide amending power contained in that article. In Australia limitations on the law-making powers of were read into the concerned provisions of the Constitution because of implications arising from the very federal nature of the Constitution: (vide Lord Mayor Councillors and Citizens of the City of Melbourne v. , 74 LR 31, and the State of Victoria v. of Australia, 122 LR ", "353). As regards the undertakings of the types mentioned above, it is true that strictly and legally speaking these undertakings only create a binding obligation on the concerned Member of the and not on the appointing authority but it cannot be forgotten that when such undertakings were thought of, the postulate underlying the same was that there was no question of the appointing authority not making the offer of permanent Judgeship to the concerned Member of the but that such an offer would be made and upon the same being made the sitting Additional Judge recruited from the should not decline to accept it and revert to the . I am therefore clearly of the view that the aforesaid convention or practice and the undertaking serve the cause of public interest in two respects as indicated above and those two aspects of public interest confer upon these sitting Additional Judges recruited from the a legitimate expectancy and the enforceable right not to be dropped illegally or at the whim or caprice of the appointing authority but to be considered for continuance in that either by way of extending their term or making them permanent in preference to freshers or outsiders and it is impossible to construe Article 224(1) as conferring upon the appointing authority absolute power and complete discretion in the matter of appointment of Additional Judges to a as suggested and the suggested construction has to be rejected. In view of the above discussion it is clear that there is a valid classification between proposed appointees for initial recruitment and the sitting Additional Judges whose cases for their continuance after the expiry of their initial term are to be decided and the two are not in the same position.\u201d The observations of are expressed hereunder:- ", "\u201c696. It may be briefly mentioned here that Writ Petition No. 274 of 1981 filed in this Court and Transferred Cases Nos. 2, 6 and 24 of 1981 were listed to be heard along with the present batch of cases with a view to avoiding the repetition of the arguments on points common to both sets of [pic]cases. In the first group of cases the question of construction of Articles 217, 224 and other connected articles prominently figured in the context of circular of the Law Minister dated March 18, 1981, seeking consent of Additional Judges for being appointed as permanent Judges in other s and the short-term extensions given to , and , Additional Judges of Delhi and the final non-appointment of and . The submission was that the circular of the Law Minister manifests a covert attempt to transfer Additional Judges from one to other without consulting of India as required by Article 222(1) and thereby circumventing the majority decision in , . The central theme was the scope, ambit and content of consultation which the President must have with the three constitutional functionaries set out in Article 217(1). In the second group of cases, the question arose in the context of transfer of , Chief Justice of Patna as Chief Justice of Madras consequent upon the transfer of , Chief Justice of Madras as Chief Justice of Kerala by Presidential Notification dated January 19, 1981, in exercise of the power conferred upon him by Article 222. The controversy centred down the scope, ambit and content of consultation that the President must have with of India before exercising the power to transfer under Article 222. Thus, the scope, ambit and content of consultation under Article 217 as also one of Article 222 which, as Mr stated, was more or less the same though the different facets on which consultation must be focussed may differ in the case of transfer and in the case of appointment, figured prominently in both the groups of cases. The parameters of scope, ambit and content of consultation both under Articles 217(1), 222 and 224, were drawn on a wide canvas to be tested on the touchstone of independence of judiciary being the fighting faith and fundamental and basic feature of the Constitution. It was stated that if the consultation itself is to provide a reliable safeguard against arbitrary and naked exercise of power against judiciary, the procedure of consultation must be so extensive as to cover all aspects of the matter and it must be made so firm and rigid that any contravention or transgression of it would be treated as mala fide or subversive of independence of judiciary and the decision can be corrected by judicial review. Therefore, at the outset it is necessary to be properly informed as to the concept of independence of judiciary as set out in the Constitution. ", "697. The entire gamut of arguments revolved principally round the construction of Articles 217 and 224 in one batch of petitions and Article 222 in another batch but the canvas was spread wide covering various other articles of the Constitution, analogous provisions in previous Government of India Acts, similar provisions in other democratic constitutions and reports of . Rival constructions canvassed centred upon the pivotal assumption that independence of judiciary is a basic and fundamental [pic]feature of the Constitution which has its genesis in the power of judicial review which enables the court to declare executive and legislative actions ultra vires the Constitution. In this connection we are not starting on a clean slate as the contention in this very form and for an avowed object was widely canvassed in , (1976) 17 Guj LR 1017 (FB), and in (supra). Some additional dimensions were added to this basic concept of independence of judiciary while both the parties vied with each other as in the past (see statement of Shri , then Attorney-General in case (supra), on proclaiming their commitment to independence of judiciary though in its scope and content and approach there was a marked divergence. ", "xxx xxx xxx ", "771. Now, power is conferred on the President to make appointment of Judge of after consultation with such of the Judges of and of the in the States as the President may deem necessary. The submission is that the expression \u2018may deem necessary\u2019 qualifies the expression \u2018consultation\u2019 and that if he deems otherwise the President can proceed to make appointment of the Chief Justice of India without consultation with any of the Judges of and of the . In other words, it was submitted on behalf of the respondents, the President has a discretion to consult or not to consult Judges of and before making appointment of Chief Justice of India. It was pointed out that where consultation is obligatory it is specifically provided and reference was made to the proviso extracted hereinabove wherein it is stated that it would be obligatory upon the President to consult the Chief Justice of India before making appointment of a Judge of other than the Chief Justice of India. Undoubtedly, the proviso leaves no option to the President but to consult the Chief Justice of India while making appointment of a Judge of other than the Chief Justice of India, but it is rather difficult to accept the construction as suggested on behalf of the respondents that in making appointment of the Chief Justice of India the President is at large and may not consult any functionary in the judicial branch of the State before making appointment of Chief Justice of India. The expression \u2018may [pic]deem necessary\u2019 qualifies the number of Judges of and to be consulted. What is optional is selection of number of Judges to be consulted and not the consultation because the expression \u2018shall be appointed after consultation\u2019 would mandate consultation. An extreme submission that the President may consult Judges for appointment of the Chief Justice of India omitting altogether Judges does not commend to us, because the consultation with \u2018such of the Judges of and of the \u2019 would clearly indicate that the consultation has to be with some Judges of and some Judges of the . The conjunction \u2018and\u2019 is clearly indicative of the intendment of the framers of the Constitution. If there was disjunctive \u2018or\u2019 between and in sub- article (2) of Article 124 there could have been some force in the submission that the President may appoint Chief Justice of India ignoring and after consulting some Judges. Undoubtedly, sub- article (2) does not cast an obligation to consult all Judges of and all Judges of the but in practical working the President in order to discharge his function of selecting the best suitable person to be the Chief Justice of India must choose such fair sprinkling of and Judges as would enable him to gather enough and relevant material which would help him in decision-making process. Mr submitted that this Court must avoid such construction of Article 124 which would enable the President to appoint Chief Justice of India without consultation with any judicial functionaries. That is certainly correct. But then he proceeded to suggest a construction where, by a constitutional convention, any necessity of consultation would be obviated and yet the executive power to be choosy and selective in appointment of Chief Justice of India can be controlled or thwarted. He said that a constitutional convention must be read that the seniormost amongst the puisne Judges of should as a rule be appointed as Chief Justice of India except when he is physically unfit to shoulder the responsibilities. This constitutional convention, it was said, when read in Article 124(2) would obviate any necessity of consultation with any functionary in the judicial branch before making appointment of Chief Justice of India and yet would so circumscribe the power of the President as not to enable the executive to choose a person of its bend and thinking. In this very context it was pointed out that Article 126 permits the President to appoint even the juniormost Judge of to be an acting Chief Justice of India and it was said that such an approach or such construction of Article 126 would be subversive of the independence of judiciary. It was said that if the juniormost can be appointed acting Chief Justice of India, every Judge in order to curry favour would decide in favour of executive. And as far as Article 124 is concerned it was said that if the convention of seniority is not read in Article 124(2 ), every Judge of would be a possible candidate for the office of Chief Justice of India and on account of [pic]personal bias would be disqualified from being consulted. There is no warrant for such an extreme position and the reflection on the Judges of is equally unwarranted. On the construction as indicated above there will be positive limitation on the power of the President while making appointment of Chief Justice of India and it is not necessary to read any limitation on the power of the President under Article 126 while making appointment of a Judge of as acting Chief Justice of India. But the observation is incidental to the submission and may be examined in an appropriate case. And the question of construction is kept open. ", "xxx xxx xxx ", "775. It was also stated that the expression \u2018obtain\u2019 in the circular has the element of coercion and a consent ceases to be consent if it is obtained under coercion. It was said that consent and coercion go ill together because forced assent would not be consent in the eye of law. It was said that the threat implicit in the circular becomes evident because the Chief Minister, the strong arm of the executive is being asked to obtain consent. If every little thing is looked upon with suspicion and as an attack on the independence of judiciary, it becomes absolutely misleading. Law Minister, if he writes directly to the Chief Justice or the Judge concerned, propriety of the action may be open to question. , J., has warned in case (supra) that the executive cannot and ought not to establish rapport with Judges (SCR p. 456 CD : SCC p. 230, para 43). Taking this direction in its letter and spirit, the Law Minister wrote to the Chief Ministers. The Chief Minister in turn was bound to approach the Chief Justice. This is also known to be a proper communication channel with Judges of . In this context the expression \u2018obtain\u2019 would only mean request the Judge to give consent if he so desires. If he gives the consent, well and good, and if does not give, no evil consequences are likely to ensue. I am not impressed by the submission of the learned Attorney-General that one who gives consent may have some advantage over the one who does not. I do not see any remote advantage and if any such advantage is given and if charge of victimisation is made out by the Judge not giving consent, the arm of judicial review is strong enough to rectify the executive error. ", "xxx xxx xxx ", "815. The public interest like public policy is an unruly horse and is incapable of any precise definition and, therefore, it was urged that this safeguard is very vague and of doubtful utility. It was urged that these safeguards failed to checkmate the arbitrary exercise of power in 1976. This approach overlooks the fact that the Lakshman Rekha drawn by the safeguards when transgressed or crossed, the judicial review will set at naught the mischief. True it is that it is almost next to impossible for individual Judge of to knock at the doors of the Courts because access to justice is via the insurmountable mountain of costs and expenses. This need not detain us because we have seen that in time of crisis the has risen to the occasion twice over in near past though it must be conceded that judicial review is increasingly becoming the preserve of the high, mighty and the affluent. But the three safeguards, namely, full and effective consultation with the Chief Justice of India, and that the power to transfer can be exercised in public interest, and judicial review, would certainly insulate independence of judiciary against an attempt by the executive to control it.\u201d Last of all, reference may be made to the observations of , J., (as he then was) who held as under:- \u201c1245. The question of policy is a matter entirely for the President to decide. Even though the Chief Justice of India is consulted in that behalf by the President since the policy relates to , his opinion is not binding on the President. It is open to the President to adopt any policy which is subject only to the judicial review by the Court. Under Article 222 of the Constitution the Chief Justice of India has to be consulted on the question whether a particular Judge should be transferred and where he should be transferred while implementing the said policy. If the Government requests the Chief Justice of India to give his opinion on a transfer to implement the said policy which is really in the public interest he cannot decline to do so. Even though the Chief Justice was opposed to the \u2018wholesale transfers\u2019 of Judges there is no bar for the Government treating the recommendation for transfers made by the Chief Justice of India as a [pic]part of the implementation of its policy. That the transfer of Shri was on account of the policy of the Government can be gathered from the following statements in the affidavits filed before this Court: In para 8 of the affidavit dated September 16, 1981 of Shri it is stated: \u201cWhen the deponent wanted to know why he might be transferred to Madras, the Hon\u2019ble Chief Justice of India merely said that it was the Government policy, but gave no clue as to what necessitated his transfer from Patna to Madras.\u201d In para 2(g) of the affidavit of the Chief Justice of India he has stated: \u201cI deny that when Shri wanted to know over the telephone on January 5, 1981, I stated merely that it was the \u2018Government policy\u2019....\u201d. In paragraph 8 of the rejoinder-affidavit dated October 16, 1981 of Shri , it is stated \u201cat one point he also said that it was Government policy to effect transfer in batches of two or three\u201d. ", "59. The sequence of judgments would now lead us to the judgment of this Court in , . The view expressed by a bench of 5 Hon\u2019ble Judges of this Court in the above case, was in respect of a controversy quite similar to the one in hand. In the instant judgment, the constitutional vires of the Administrative Tribunals Act , 1985 was under challenge. The above Act was framed under Article 323A of the Constitution. Article 323A was introduced in the Constitution by the Constitution (Forty-second Amendment) Act, 1976. The main judgment was delivered by , J. (as he then was) on behalf of himself and , and , JJ. Insofar as the concurring view rendered by , CJ is concerned, the conclusion recorded in the following paragraphs has a bearing on the present controversy. \u201c3. It is now well settled as a result of the decision of this Court in , , that judicial review is a basic and essential feature of the Constitution and no law passed by in exercise of its constituent power can abrogate it or take it away. If the power of judicial review is abrogated or taken away the Constitution will cease to be what it is. It is a fundamental principle of our constitutional scheme that every organ of the , every authority under the Constitution, derives its power from the Constitution and has to act within the limits of such power. It is a limited government which we have under the Constitution and both the executive and the legislature have to act within the limits of the power conferred upon them under the Constitution. Now a question may arise as to what are the powers of the executive and whether the executive has acted within the scope of its power. Such a question obviously cannot be left to the executive to decide and for two very good reasons. First the decision of the question would depend upon the interpretation of the Constitution and the laws and this would pre-eminently be a matter fit to be decided by the judiciary, because it is the judiciary which alone would be possessed of expertise in this field and secondly, the constitutional and legal protection afforded to the citizen would become illusory, if it were left to the executive to determine the legality of its own action. So also if the legislature makes a law and a dispute arises whether in making the law, the legislature has acted outside the area of its legislative competence or the law is violative of the fundamental rights or of any other provisions of the Constitution, its resolution cannot, for the same reasons, be left to the determination of the legislature. The Constitution has, therefore created an independent machinery for resolving these disputes and this independent machinery is the judiciary which is vested with the power of judicial review to determine the legality of executive action and the validity of [pic]legislation passed by the legislature. The judiciary is constituted the ultimate interpreter of the Constitution and to it is assigned the delicate task of determining what is the extent and scope of the power conferred on each branch of government, what are the limits on the exercise of such power under the Constitution and whether any action of any branch transgresses such limits. It is also a basic principle of the rule of law which permeates every provision of the Constitution and which forms its very core and essence that the exercise of power by the executive or any other authority must not only be conditioned by the Constitution but also be in accordance with law and it is the judiciary which has to ensure that the law is observed and there is compliance with the requirements of law on the part of the executive and other authorities. This function is discharged by the judiciary by exercise of the power of judicial review which is a most potent weapon in the hands of the judiciary for maintenance of the Rule of Law. The power of judicial review is an integral part of our constitutional system and without it, there will be no government of laws and the Rule of Law would become a teasing illusion and a promise of unreality. That is why I observed in my judgment in case (supra) at p. 287 and 288: ( p. 678, para 87) \u201cI am of the view that if there is one feature of our Constitution which, more than any other, is basic and fundamental to the maintenance of democracy and the rule of law, it is the power of judicial review and it is unquestionably, to my mind, part of the basic structure of the Constitution. Of course, when I say this I should not be taken to suggest that effective alternative institutional mechanisms or arrangements for judicial review cannot be made by . But what I wish to emphasise is that judicial review is a vital principle of our Constitution and it cannot be abrogated without affecting the basic structure of the Constitution. If by a constitutional amendment, the power of judicial review is taken away and it is provided that the validity of any law made by the legislature shall not be liable to be called in question on any ground, even if it is outside the legislative competence of the legislature or is violative of any fundamental rights, it would be nothing short of subversion of the Constitution, for it would make a mockery of the distribution of legislative powers between the Union and the s and render the fundamental rights meaningless and futile. So also if a constitutional amendment is made which has the effect of taking away the power of judicial review and providing that no amendment made in the Constitution shall be liable to be questioned on any ground, even if such amendment is violative of the basic structure and, therefore, outside the amendatory power of , it would be making sole judge of the constitutional validity of what it has done and that would, in effect and substance, nullify the limitation on the amending power of and affect the basic structure of the Constitution. The conclusion must therefore inevitably follow that clause (4) of the Article 368 is unconstitutional and void as damaging the basic structure of the Constitution.\u201d It is undoubtedly true that my judgment in case (supra) was a minority judgment but so far as this aspect is concerned, the majority Judges also took the same view and held that judicial review is a basic and essential feature of the Constitution and it cannot be abrogated without affecting the basic structure of the Constitution and it is equally clear from the same decision [pic]that though judicial review cannot be altogether abrogated by by amending the Constitution in exercise of its constituent power, can certainly, without in any way violating the basic structure doctrine, set up effective alternative institutional mechanisms or arrangements for judicial review. The basic and essential feature of judicial review cannot be dispensed with but it would be within the competence of to amend the Constitution so as to substitute in place of , another alternative institutional mechanism or arrangement for judicial review, provided it is no less efficacious than . Then, instead of , it would be another institutional mechanism or authority which would be exercising the power of judicial review with a view to enforcing the constitutional limitations and maintaining the rule of law. Therefore, if any constitutional amendment made by takes away from the power of judicial review in any particular area and vests it in any other institutional mechanism or authority, it would not be violative of the basic structure doctrine, so long as the essential condition is fulfilled, namely, that the alternative institutional mechanism or authority set up by the parliamentary amendment is no less effective than . ", "4. Here, in the present case, the impugned Act has been enacted by in exercise of the power conferred by clause (1) of Article 323- A which was introduced in the Constitution by Constitution (42nd Amendment) Act , 1976. Clause (2)(d) of this article provides that a law made by under clause (1) may exclude the jurisdiction of courts, except the jurisdiction of under Article 136 , with respect to the disputes or complaints referred to in clause (1). The exclusion of the jurisdiction of under Articles 226 and 227 by any law made by under clause (1) of Article 323-A is, therefore, specifically authorised by the constitutional amendment enacted in clause (2)(d) of that article. It is clear from the discussion in the preceding para that this constitutional amendment authorising exclusion of the jurisdiction of under Articles 226 and 227 postulates for its validity that the law made under clause (1) of Article 323-A excluding the jurisdiction of under Articles 226 and 227 must provide for an effective alternative institutional mechanism or authority for judicial review. If this constitutional amendment were to permit a law made under clause (1) of Article 323-A to exclude the jurisdiction of under Articles 226 and 227 without setting up an effective alternative institutional mechanism or arrangement for judicial review, it would be violative of the basic structure doctrine and hence outside the constituent power of . It must, therefore, be read as implicit in this constitutional amendment that the law excluding the jurisdiction of under Articles 226 and 227 permissible under it must not leave a void but it must set up another effective institutional mechanism or authority and vest the power of judicial review in it. Consequently, the impugned Act excluding the jurisdiction of under Articles 226 and 227 in respect of service matters and vesting such jurisdiction in can pass [pic]the test of constitutionality as being within the ambit and coverage of clause (2)(d) of Article 323-A , only if it can be shown that set up under the impugned Act is equally efficacious as , so far as the power of judicial review over service matters is concerned. We must, therefore, address ourselves to the question whether established under the impugned Act can be regarded as equally effective and efficacious in exercising the power of judicial review as acting under Articles 226 and 227 of the Constitution.\u201d Extracts from the judgment rendered by , (as he then was) are first of all being reproduced hereunder:- ", "\u201c10. In the writ applications as presented, the main challenge was to the abolition of the jurisdiction of this Court under Article 32 in respect of specified service disputes. Challenge was also raised against the taking away of the jurisdiction of under Articles 226 and 227. It was further canvassed that establishment of Benches of the at Allahabad, Bangalore, Bombay, Calcutta, Gauhati, Madras and Nagpur with the principal seat at Delhi would still prejudice the parties whose cases were already pending before the respective located at places other than these places and unless at the seat of every facilities for presentation of applications and for hearing thereof were provided the parties and their lawyers would be adversely affected. The interim order made on October 31, 1985, made provision to meet the working difficulties. Learned Attorney-General on behalf of assured the court that early steps would be taken to amend the law so as to save the jurisdiction under Article 32 , remove other minor anomalies and set up a Bench of the at the seat of every . By the Administrative s (Amendment) Ordinance, 1986, these amendments were brought about and by now an appropriate Act of has replaced the Ordinance. Most of the original grounds of attack thus do not survive and the contentions that were canvassed at the hearing by the counsel appearing for different parties are these: ", "(1) Judicial review is a fundamental aspect of the basic structure of our Constitution and bar of the jurisdiction of under Articles 226 and 227 as contained in Section 28 of the Act cannot be sustained; [pic](2) Even if the bar of jurisdiction is upheld, the being a substitute of , its constitution and set up should be such that it would in fact function as such substitute and become an institution in which the parties could repose faith and trust; ", "(3) Benches of the Tribunal should not only be established at the seat of every High Court but should be available at every place where the High Courts have permanent Benches; ", "(4) So far as set up or to be set up by the or the State Governments are concerned, they should have no jurisdiction in respect of employees of or members of the subordinate judiciary and employees working in such establishments inasmuch as exercise of jurisdiction of the would interfere with the control absolutely vested in the respective in regard to the judicial and other subordinate officers under Article 235 of the Constitution. ", "11. After oral arguments were over, learned Attorney-General, after obtaining instructions from filed a memorandum to the effect that Section 2(q) of the Act would be suitably amended so as to exclude officers and servants in the employment of and members and staff of the subordinate judiciary from the purview of the Act. In the same memorandum it has also been said that Government would arrange for sittings of the Benches of the Tribunal at the seat or seats of each High Court on the basis that \u2018sittings\u2019 will include \u2018circuit sittings\u2019 and the details thereof would be worked out by the Chairman or the Vice- Chairman concerned. ", "12. With these concessions made by the learned Attorney-General, only two aspects remain to be dealt with by us, namely, those covered by the first and the second contentions. ", "13. Strong reliance was placed on the judgment of , J. (one of us \u2014 presently the learned Chief Justice) in , , where it was said: (SCC p. 678, para 87) \u201cThe power of judicial review is an integral part of our constitutional system and without it, there will be no government of laws and the rule of law would become a teasing illusion and a promise of unreality. I am of the view that if there is one feature of our Constitution which, more than any other, is basic and fundamental to the maintenance of democracy and the rule of law, it is the power of judicial review and it is unquestionably, to my mind, part of the basic structure of the Constitution. Of course, when I say this I should not be taken to suggest that effective alternative institutional mechanisms or arrangements for judicial review cannot be made by . But what I wish to emphasise is that judicial review is a vital principle of our Constitution and it cannot be abrogated without affecting the basic structure of the Constitution. If by a constitutional amendment, the power of judicial review is taken away and it is provided that the validity of any law made by the legislature shall not be liable to be called in question on any ground, even if it is outside the legislative competence of the legislature or is violative of any fundamental rights, it would be nothing short of subversion of the Constitution, for it would make a mockery of the distribution of legislative powers between the and the States and render the fundamental rights meaningless and futile. So also if a constitutional amendment is made which has the effect of taking away the power of judicial review\u2026\u201d ", "14. Article 32 was described by Dr in course of the debate in as the \u2018soul\u2019 and \u2018heart\u2019 of the Constitution and it is in recognition of this position that though Article 323-A(2)(d) authorised exclusion of jurisdiction under Article 32 and the original Act had in Section 28 provided for it, by amendment jurisdiction under Article 32 has been left untouched. The Act thus saves jurisdiction of this both under Article 32 in respect of original proceedings as also under Article 136 for entertaining appeals against decisions of the on grant of special leave. Judicial review by the Apex has thus been left intact. ", "15. The question that arises, however, for consideration is whether bar of jurisdiction under Articles 226 and 227 affects the provision for judicial review. The right to move in its writ jurisdiction \u2014 unlike the one under Article 32 \u2014 is not a fundamental right. Yet, s, as the working experience of three-and-a-half decades shows have in exercise of the power of judicial review played a definite and positive role in the matter of preservation of fundamental and other rights and in keeping administrative action under reasonable control. In these thirty-six years following the enforcement of the Constitution, not only has India\u2019s population been more than doubled but also the number of litigations before the courts including s has greatly increased. As the pendency in s increased and soon became the pressing problem of backlog, the nation\u2019s attention came to be bestowed on this aspect. Ways and means to relieve s of the load began to engage the attention of the government at the as also in the various s. As early as 1969, a was set up by under the chairmanship of Mr Justice of this to make recommendations suggesting ways and means for effective, expeditious and satisfactory disposal of matters relating to service disputes of government servants as it was found that a sizeable portion of pending litigations related to this category. The recommended the setting up of an independent to handle the pending cases before this and s. While this report was still engaging the attention of government, also took note of the situation and recommended the setting up of s to deal with appeals of Government servants against disciplinary action. In certain s, s of this type came into existence and started functioning. But looked into the matter further as it transpired that the major chunk of service litigations related to matters other than disciplinary action. In May 1976, s discussed this problem. Then came the Forty- second Amendment of the [pic]Constitution bringing in Article 323-A which authorized to provide by law \u201cfor the adjudication or trial by Administrative s of disputes and complaints with respect to recruitment and conditions of service of persons appointed to public services and posts in connection with the affairs of the Union or of any or of any local or other authority within the territory of India or under the control of the Government of India or of any owned or controlled by the government\u201d. As already stated this article envisaged exclusion of the jurisdiction of all courts, except the jurisdiction of the Supreme under Article 136 , with respect to the disputes or complaints referred to in clause (1). Though the Constitution now contained the enabling power, no immediate steps were taken to set up any as contemplated by Article 323-A. A Constitution Bench of this in , , observed: [SCC p. 39, para 1 : SCC (L & S) p. 486] \u201cThere are few other litigative areas than disputes between members of various services inter se, where the principle that public policy requires that all litigation must have an end can apply with greater force. Public servants ought not to be driven or required to dissipate their time and energy in courtroom battles. Thereby their attention is diverted from public to private affairs and their inter se disputes affect their sense of oneness without which no institution can function effectively. The constitution of Service s by Governments with an apex at the , which, in the generality of cases, should be the final arbiter of controversies relating to conditions of service, including the vexed question of seniority, may save the courts from the avalanche of writ petitions and appeals in service matters. The proceedings of such s can have the merit of informality and if they will not be tied down to strict rules of evidence, they might be able to produce solutions which will satisfy many\u2026\u201d In the meantime the problem of the backlog of cases in s became more acute and pressing and came to be further discussed in and in conferences and seminars. Ultimately in January 1985, both Houses of passed the Bill and with the Presidential assent on February 27, 1985, the law enabling the long awaited to be constituted came into existence. As already noticed, notified the Act to come into force with effect from November 1, 1985. ", "16. Exclusion of the jurisdiction of in service matters and its propriety as also validity have thus to be examined in the background indicated above. We have already seen that judicial review by this Court is left wholly unaffected and thus there is a forum where matters of importance and grave injustice can be brought for determination or rectification. Thus exclusion of the jurisdiction of does not totally bar judicial review. This Court in case (supra) did point out that \"effective alternative institutional mechanisms or arrangements for judicial review\" can be made by . Thus it is possible to set up an alternative institution in place of for providing judicial review. The debates and deliberations spread over almost two decades for exploring ways and means for relieving of the load of backlog of cases and for assuring quick settlement of service disputes in the interest of the public servants as also the country cannot be lost sight of while considering this aspect. It has not been disputed before us - and perhaps could not have been - that the under the scheme of the Act would take over a part of the existing backlog and a share of the normal load of . The has been contemplated as a substitute and not as supplemental to in the scheme of administration of justice. To provide the as an additional forum from where parties could go to would certainly have been a retrograde step considering the situation and circumstances to meet which the innovation has been brought about. Thus barring of the jurisdiction of can indeed not be a valid ground of attack. ", "17. What, however, has to be kept in view is that the should be a real substitute of - not only in form and de jure but in content and de facto. As was pointed out in 's case (supra), the alternative arrangement has to be effective and efficient as also capable of upholding the constitutional limitations. Article 16 of the Constitution guarantees equality of opportunity in matters of public employment. Article 15 bars discrimination on grounds of religion, race, caste, sex or place of birth. The touch-stone of equality enshrined in Article 14 is the greatest of guarantees for the citizen. Centering around these articles in the Constitution a service jurisprudence has already grown in this country. Under Sections 14 and 15 of the Act all the powers of the except those of this in regard to matters specified therein vest in the \u2014- either Central or State. Thus the is the substitute of and is entitled to exercise the powers thereof. ", "18. have been functioning over a century and a quarter and until was established under the Government of India Act, 1935, used to be the highest courts within their respective jurisdictions subject to an appeal to in a limited category of cases. In this long period of about six scores of years, have played their role effectively, efficiently as also satisfactorily. The litigant in this country has seasoned himself to look upto as the unfailing protector of his person, property and honour. The institution has served its purpose very well and the common man has thus come to repose great confidence therein. Disciplined, independent and trained Judges well versed in law and working with all openness in an unattached and objective manner have ensured dispensation of justice over the years. Aggrieved people approach the - the social mechanism to act as the arbiter - not under legal obligation but under the belief and faith that justice shall be done to them and the 's authorities would implement the decision of the . It is, therefore, of paramount importance that the substitute institution - the - must be a worthy successor of in all respects. That is exactly what this intended to convey when it spoke of an alternative mechanism in case (supra).\u201d ", "60. Reference may also be made to the decision rendered by this Court in , . The instant decision was rendered by a constitution bench of 7 Judges. The question which arose for determination in the instant judgment was, whether the power conferred upon the and the State legislatures vide Articles 323A(2)(d) and 323B(3)(d) totally excluding the jurisdiction of \u201call courts\u201d except , under Article 136 of the Constitution, violated the \u201cbasic structure\u201d of the Constitution. In other words, the question was, whether annulling/retracting the power of \u201cjudicial review\u201d conferred on High Courts (under Articles 226 and 227 of the Constitution) and on (under Articles 32 of the Constitution), was violative of the \u201cbasic structure\u201d of the Constitution. Furthermore, whether the tribunals constituted under Articles 323A and 323B of the Constitution, possess the competence to test the constitutional validity of statutory provisions/rules? And also, whether Tribunals constituted under Articles 323A and 323B of the Constitution could be said to be effective substitutes of the jurisdiction vested in ? And if not, what changes were required? The above controversy came to be referred to the constitution bench in furtherance of an order passed in , , on account of the decisions rendered in post cases (supra), namely, , , , , , , , , and , . On the issues which are relevant to the present controversy, this Court observed as under:- \u201c76. To express our opinion on the issue whether the power of judicial review vested in and in under Articles 226/227 and 32 is part of the basic structure of the Constitution, we must first attempt to understand what constitutes the basic structure of the Constitution. The doctrine of basic structure was evolved in case,. However, as already mentioned, that case did not lay down that the specific and particular features mentioned in that judgment alone would constitute the basic structure of our Constitution. Indeed, in the judgments of and , ., and , . and , J., there are specific observations to the effect that their list of essential features comprising the basic structure of the Constitution are illustrative and are not intended to be exhaustive. In case, 1975 Supp. SCC 1, , J. held that the proper approach for a Judge who is confronted with the question whether a particular facet of the Constitution is part of the basic structure, is to examine, in each individual case, the place of the particular feature in the scheme of our Constitution, its object and purpose, and the consequences of its denial on the integrity of our Constitution as a fundamental instrument for the governance of the country. (supra at pp. 751- ", "752). This approach was specifically adopted by , J. in case, (1980) 3 SCC 625, (at pp. 671-672) and is not regarded as the definitive test in this field of Constitutional Law. ", "77. We find that the various factors mentioned in the test evolved by , J. have already been considered by decisions of various Benches of this that have been referred to in the course of our analysis. From their conclusions, many of which have been extracted by us in toto, it appears that this has always considered the power of judicial review vested in the High s and in this under Articles 226 and 32 respectively, enabling legislative action to be subjected to the scrutiny of superior courts, to be integral to our constitutional scheme. While several judgments have made specific references to this aspect [, C.J. in case, AIR 1965 SC 745, , J. and , J. in Kesavananda Bharati [pic]case (supra), , C.J. and Bhagwati, J. in Minerva Mills (supra), , C.J. in Fertilizer Kamgar, (1981) 1 SCC 568, , J. in ., (1991) 4 SCC 406] the rest have made general observations highlighting the significance of this feature. ", "78. The legitimacy of the power of courts within constitutional democracies to review legislative action has been questioned since the time it was first conceived. The Constitution of India, being alive to such criticism, has, while conferring such power upon the higher judiciary, incorporated important safeguards. An analysis of the manner in which the Framers of our Constitution incorporated provisions relating to the judiciary would indicate that they were very greatly concerned with securing the independence of the judiciary. These attempts were directed at ensuring that the judiciary would be capable of effectively discharging its wide powers of judicial review. While the Constitution confers the power to strike down laws upon and , it also contains elaborate provisions dealing with the tenure, salaries, allowances, retirement age of Judges as well as the mechanism for selecting Judges to the superior courts. The inclusion of such elaborate provisions appears to have been occasioned by the belief that, armed by such provisions, the superior courts would be insulated from any executive or legislative attempts to interfere with the making of their decisions. The Judges of the superior courts have been entrusted with the task of upholding the Constitution and to this end, have been conferred the power to interpret it. It is they who have to ensure that the balance of power envisaged by the Constitution is maintained and that the legislature and the executive do not, in the discharge of their functions, transgress constitutional limitations. It is equally their duty to oversee that the judicial decisions rendered by those who man the subordinate courts and tribunals do not fall foul of strict standards of legal correctness and judicial independence. The constitutional safeguards which ensure the independence of the Judges of the superior judiciary, are not available to the Judges of the subordinate judiciary or to those who man tribunals created by ordinary legislations. Consequently, Judges of the latter category can never be considered full and effective substitutes for the superior judiciary in discharging the function of constitutional interpretation. We, therefore, hold that the power of judicial review over legislative action vested in under Article 226 and in this under Article 32 of the Constitution is an integral and essential feature of the Constitution, constituting part of its basic structure. Ordinarily, therefore, the power of High s and to test the constitutional validity of legislations can never be ousted or excluded. ", "79. We also hold that the power vested in to exercise judicial superintendence over the decisions of all courts and tribunals within [pic]their respective jurisdictions is also part of the basic structure of the Constitution. This is because a situation where are divested of all other judicial functions apart from that of constitutional interpretation, is equally to be avoided. ", "xxx xxx xxx ", "96. It has been brought to our notice that one reason why these have been functioning inefficiently is because there is no authority charged with supervising and fulfilling their administrative requirements. To this end, it is suggested that the be made subject to the supervisory jurisdiction of within whose territorial jurisdiction they fall. We are, however, of the view that this may not be the best way of solving the problem. We do not think that our constitutional scheme requires that all adjudicatory bodies which fall within the territorial jurisdiction of should be subject to their supervisory jurisdiction. If the idea is to divest of their onerous burdens, then adding to their supervisory functions cannot, in any manner, be of assistance to them. The situation at present is that different constituted under different enactments are administered by different administrative departments of the and the Governments. The problem is compounded by the fact that some have been created pursuant to Legislations and some others have been created by Legislations. However, even in the case of created by parliamentary legislations, there is no uniformity in administration. We are of the view that, until a wholly independent agency for the administration of all such can be set up, it is desirable that all such should be, as far as possible, under a single nodal ministry which will be in a position to oversee the working of these . For a number of reasons that should appropriately be the of Law. It would be open for the , in its turn, to appoint an independent supervisory body to oversee the working of the . This will ensure that if the President or Chairperson of the is for some reason unable to take sufficient interest in the working of the , the entire system will not languish and the ultimate consumer of justice will not suffer. The creation of a single umbrella organisation will, in our view, remove many of the ills of the present system. If the need arises, there can be separate umbrella organisations at the and the levels. Such a supervisory authority must try to ensure that the independence of the members of all such is maintained. To that extent, the procedure for the selection of the members of the , the manner in which funds are allocated for the functioning of the and all other consequential details will have to be clearly spelt out. ", "97. The suggestions that we have made in respect of appointments to and the supervision of their administrative function need to be considered in detail by those entrusted with the duty of formulating the policy in this respect. That body will also have to take into consideration the comments of expert bodies like the and in this regard. We, therefore, recommend that initiate action in this behalf and after consulting all concerned, place all these under one single nodal department, preferably . ", "98. Since we have analysed the issue of the constitutional validity of Section 5(6) of the Act at length, we may now pronounce our opinion on this aspect. Though the vires of the provision was not in question in Dr case, , we believe that the approach adopted in that case, the relevant portion of which has been extracted in the first part of this judgment, is correct since it harmoniously resolves the manner in which Sections 5(2) and 5(6) can operate together. We wish to make it clear that where a question involving the interpretation of a statutory provision or rule in relation to the Constitution arises for the consideration of of , the proviso to Section 5(6) will automatically apply and the Chairman or the Member concerned shall refer the matter to a Bench consisting of at least two Members, one of whom must be a Judicial Member. This will ensure that questions involving the vires of a statutory provision or rule will never arise for adjudication before or a Bench which does not consist of a Judicial Member. So construed, Section 5(6) will no longer be susceptible to charges of unconstitutionality. ", "99. In view of the reasoning adopted by us, we hold that clause 2(d) of Article 323-A and clause 3(d) of Article 323-B , to the extent they exclude the jurisdiction of and under Articles 226/227 and 32 of the Constitution, are unconstitutional. Section 28 of the Act and the \u201cexclusion of jurisdiction\u201d clauses in all other legislations enacted under the aegis of Articles 323-A and 323-B would, to the same extent, be unconstitutional. The jurisdiction conferred upon under Articles 226/227 and upon under Article 32 of the Constitution is a part of the inviolable basic structure of our Constitution. While this jurisdiction cannot be ousted, other courts and may perform a supplemental role in discharging the powers conferred by Articles 226/227 and 32 of the Constitution. The created under Article 323-A and Article 323-B of the Constitution are possessed of the competence to test the constitutional validity of statutory provisions and rules. All decisions of these will, however, be subject to scrutiny before of within whose jurisdiction the concerned falls. The will, nevertheless, continue to act like courts of first instance in respect of the areas of law for which they have been constituted. It will not, therefore, be open for litigants to directly approach even in cases where they question the vires of statutory legislations (except where the legislation which creates the particular is challenged) by overlooking the jurisdiction of the concerned. Section 5(6) of the Act is valid and constitutional and is to be interpreted in the manner we have indicated.\u201d ", "61. Reference was then made to , . The instant decision was rendered by a constitution bench of 5 Judges. The controversy adjudicated upon in this case related to a challenge to the constitutional validity of Parts 1B and 1C of the Companies Act, 1956. These parts were inserted into the Companies Act , by the Companies (Second Amendment) Act , 2002. Thereby, provision was made for the constitution of and . The relevant questions raised in the present controversy, are being noticed. Firstly, whether does not have the jurisdiction/legislative competence, to vest intrinsic judicial functions, that have been traditionally performed by , in any tribunal outside the judiciary? Secondly, whether transferring of the entire company law jurisdiction, hitherto before vested in , to , which was not under the control of the judiciary, was violative of the principles of \u201cseparation of powers\u201d and \u201cindependence of judiciary\u201d? Thirdly, whether Sections 10-FB , 10-FD , 10-FE , 10-FF , 10-FL(2) , 10-FO , 10-FR(3) , 10-FT , 10-FX contained in Parts I- B and I-C of the Companies Act, by virtue of the above amendment, were unconstitutional being in breach of the principles of the \u201crule of law\u201d, \u201cseparation of powers\u201d and \u201cindependence of judiciary\u201d? The relevant narration and conclusions recorded by this Court are being reproduced hereunder:- ", "\u201c Section 10-FD(3)(f) : Appointment of Technical Member to ", "16. has held that appointment of a member under the category specified in Section 10-FD(3)(f) , can have a role only in matters concerning revival and rehabilitation of sick industrial companies and not in relation to other matters. has therefore virtually indicated that should have two divisions, that is and and persons selected under the category specified in clause (f) should only be appointed as Members of . ", "17. contends that similar provision exists in Section 4(3) of the Sick Industrial Companies (Special Provisions) Act, 1985; that the provision is only an enabling one so that the best talent can be selected by headed by the Chief Justice of India or his nominee; and that it may not be advisable to have division or limit or place restrictions on the power of the President of the Tribunal to constitute [pic]appropriate benches. It is also pointed out that a technical member would always sit in a Bench with a judicial member. Section 10-FD(3)(g) : Qualification for appointment of Technical Member ", "18. has observed that in regard to the Presiding Officers of and or , a minimum period of three to five years\u2019 experience should be prescribed, as what is sought to be utilised is their expert knowledge in labour laws. ", "19. submits that it may be advisable to leave the choice of selection of the most appropriate candidate to headed by the Chief Justice of India or his nominee. ", "20. has also observed that as persons who satisfy the qualifications prescribed in Section 10-FD(3)(g) would be persons who fall under Section 10-FD(2)(a) , it would be more appropriate to include this qualification in Section 10-FD(2)(a) . It has also observed in Section 10-FL dealing with \u201cBenches of the Tribunal\u201d, a provision should be made that a \u201cjudicial member\u201d with this qualification shall be a member of referred to in Section 10-FL(2) for cases relating to rehabilitation, restructuring or winding up of companies. ", "21. has not accepted these findings and contends that the observations of would amount to judicial legislation. ", "Section 10-FD(3)(h) : Qualification of Technical Member of ", "22. has observed that clause (h) referring to the category of persons having special knowledge of and experience in matters relating to labour, for not less than 15 years is vague and should be suitably amended so as to spell out with certainty the qualification which a person to be appointed under clause (h) should possess. ", "23. contends that in view of the wide and varied experience possible in labour matters, it may not be advisable to set out the nature of experience or impose any restrictions in regard to the nature of experience. It is submitted that headed by the Chief Justice of India or his nominee would consider each application on its own merits. ", "24. The second observation of is that the member selected under the category mentioned in clause (h) must confine his participation only to the Benches dealing with revival and rehabilitation of sick companies and should also be excluded from functioning as a single-Member Bench for any matter. ", "25. contends that it may not be advisable to fetter the prerogative of the President of the to constitute benches by making use of available members. It is also pointed out that it may not be proper to presume that a person well versed in labour matters will be unsuitable to be associated with a judicial member in regard to adjudication of winding-up matters. ", "xxx xxx xxx Section 10-FX : Selection process for President/Chairperson ", "31. has expressed the view that the selection of the President/Chairperson should be by a Committee headed by the Chief Justice of India in consultation with two senior Judges of . [pic] 32. has submitted that it would not be advisable to make such a provision in regard to appointment of the President/Chairperson of statutory tribunals. It is pointed out that no other legislation constituting tribunals has such a provision.\u201d In order to assail the challenge to the provisions extracted hereinabove, asserted, that (the judgment whereof was, also under challenge) having held that the had the competence and the power to establish and , ought to have dismissed the writ petition. The assertion at the hands of was, that some of the directions contained in the judgment rendered by , reframed and recast Parts 1B and 1C introduced by the Amendment Act and amounted to converting \u201cjudicial review\u201d into judicial legislation. It was, however noticed, that having agreed to rectify several of the defects pointed out by , the appeal of was restricted to the findings of relating to Sections 10-FD(3)(f) , (g), (h) and 10-FX. To understand the tenor of the issue which was the subject matter before this Court, it is relevant to extract some of the provisions of the Companies Act , 1956 as amended by the Companies (Second Amendment) Act , 2002, relating to the constitution of and ). The same are reproduced hereunder:- ", "\u201cPART I-B NATIONAL COMPANY LAW TRIBUNAL 10-FB. Constitution of National Company Law Tribunal.\u2014 shall, by notification in the Official Gazette, constitute a Tribunal to be known as to exercise and discharge such powers and functions as are, or may be, conferred on it by or under this Act or any other law for the time being in force. 10-FC. Composition of Tribunal.\u2014The Tribunal shall consist of a President and such number of judicial and technical members not exceeding sixty-two, as deems fit, to be appointed by that Government, by notification in the Official Gazette. 10-FD. Qualifications for appointment of President and Members.\u2014(1) shall appoint a person who has been, or is qualified to be, a Judge of as the President of the Tribunal. (2) A person shall not be qualified for appointment as judicial member unless he\u2014 ", "(a) has, for at least fifteen years, held a judicial office in the territory of India; or ", "(b) has, for at least ten years been an advocate of , or has partly held judicial office and has been partly in practice as an advocate for a total period of fifteen years; or ", "(c) has held for at least fifteen years a Group A post or an equivalent post under or including at least three years of service as a Member of (Legal Branch) in Senior Administrative Grade in that service; or ", "(d) has held for at least fifteen years a Group A post or an equivalent post under (including at least three years of service as a Member of in Grade I of that service). ", "[pic] (3) A person shall not be qualified for appointment as technical member unless he\u2014 ", "(a) has held for at least fifteen years a Group A post or an equivalent post under or [including at least three years of service as a Member of (Accounts Branch) in Senior Administrative Grade in that service]; or ", "(b) is, or has been, a Joint Secretary to under , or held any other post under or carrying a scale of pay which is not less than that of a Joint Secretary to , for at least five years and has adequate knowledge of, and experience in, dealing with problems relating to company law; or ", "(c) is, or has been, for at least fifteen years in practice as a chartered accountant under the Chartered Accountants Act , 1949 ; or ", "(d) is, or has been, for at least fifteen years in practice as a cost accountant under the Cost and Works Accountants Act , 1959 ; or ", "(e) is, or has been, for at least fifteen years working experience as a Secretary in wholetime practice as defined in clause (45-A) of Section 2 of this Act and is a member of constituted under the Company Secretaries Act , 1980 ; or ", "(f) is a person of ability, integrity and standing having special knowledge of, and professional experience of not less than twenty years in science, technology, economics, banking, industry, law, matters relating to industrial finance, industrial management, industrial reconstruction, administration, investment, accountancy, marketing or any other matter, the special knowledge of, or professional experience in, which would be in the opinion of useful to the ; or ", "(g) is, or has been, a Presiding Officer of , or National constituted under the Industrial Disputes Act , 1947 ; or ", "(h) is a person having special knowledge of, and experience of not less than fifteen years in, the matters relating to labour. Explanation.\u2014For the purposes of this Part,\u2014 ", "(i) \u2018judicial member\u2019 means a Member of the Tribunal appointed as such under sub-section (2) of Section 10-FD and includes the President of the Tribunal; ", "(ii) \u2018technical member\u2019 means a Member of the Tribunal appointed as such under sub-section (3) of Section 10-FD . ", "10-FE. Term of office of President and Members.\u2014The President and every other Member of the shall hold office as such for a term of three years from the date on which he enters upon his office, but shall be eligible for reappointment: ", "Provided that no President or other Member shall hold office as such after he has attained,\u2014 [pic] (a) in the case of the President, the age of sixty-seven years; ", "(b) in the case of any other Member, the age of sixty-five years: Provided further that the President or other Member may retain his lien with his parent cadre or or , as the case may be, while holding office as such. ", "10-FF. Financial and administrative powers of Member Administration.\u2014The Central Government shall designate any judicial member or technical member as Member (Administration) who shall exercise such financial and administrative powers as may be vested in him under the rules which may be made by : ", "Provided that the Member (Administration) shall have authority to delegate such of his financial and administrative powers as he may think fit to any other officer of the subject to the condition that such officer shall, while exercising such delegated powers continue to act under the direction, superintendence and control of the Member (Administration). ", "* * * 10-FK. Officers and employees of Tribunal.\u2014(1) The Central Government ", "shall provide the with such officers and other employees as it may deem fit. ", "(2) The officers and other employees of the shall discharge their functions under the general superintendence of . (3) The salaries and allowances and other terms and conditions of service of the officers and other employees of the shall be such as may be prescribed. ", "10-FL. Benches of .\u2014(1) Subject to the provisions of this section, the powers of the may be exercised by Benches, constituted by the President of the , out of which one shall be a judicial member and another shall be a technical member referred to in clauses (a) to (f) of sub-section (3) of Section 10-FD : Provided that it shall be competent for the Members authorised in this behalf to function as a Bench consisting of a single Member and exercise the jurisdiction, powers and authority of the in respect of such class of cases or such matters pertaining to such class of cases, as the President of the may, by general or special order, specify: Provided further that if at any stage of the hearing of any such case or matter, it appears to the Member of the that the case or matter is of such a nature that it ought to be heard by a Bench consisting of two Members, the case or matter may be transferred by the President of the or, as the case may be, referred to him for transfer to such Bench as the President may deem fit. ", "(2) The President of the shall, for the disposal of any case relating to rehabilitation, restructuring or winding up of the companies, constitute one or more special Benches consisting of three or more Members, each of whom shall necessarily be a judicial member, a technical member appointed under any of the clauses (a) to (f) of sub-section (3) of Section 10-FD , and a Member appointed under clause (g) or clause (h) of sub-section (3) of Section 10-FD : ", "[pic] Provided that in case a Special Bench passes an order in respect of a company to be wound up, the winding-up proceedings of such company may be conducted by a Bench consisting of a single Member. (3) If the Members of a Bench differ in opinion on any point or points, it shall be decided according to the majority, if there is a majority, but if the Members are equally divided, they shall state the point or points on which they differ, and the case shall be referred by the President of the for hearing on such point or points by one or more of the other Members of the and such point or points shall be decided according to the opinion of the majority of Members of the who have heard the case, including those who first heard it. ", "(4) There shall be constituted such number of Benches as may be notified by the Central Government. ", "(5) In addition to the other Benches, there shall be a Principal Bench at New Delhi presided over by the President of the . (6) The Principal Bench of the shall have powers of transfer of proceedings from any Bench to another Bench of the in the event of inability of any Bench from hearing any such proceedings for any reason: Provided that no transfer of any proceedings shall be made under this sub- section except after recording the reasons for so doing in writing. ", "* * * 10-FO. Delegation of powers.\u2014The may, by general or special ", "order, delegate, subject to such conditions and limitations, if any, as may be specified in the order, to any Member or officer or other employee of the or other person authorized by the to manage any industrial company or industrial undertaking or any operating agency, such powers and duties under this Act as it may deem necessary. ", "PART I-C APPELLATE TRIBUNAL * * * 10-FR. Constitution of Appellate Tribunal.\u2014(1) The Central Government ", "shall, by notification in the Official Gazette, constitute with effect from such date as may be specified therein, an Appellate to be called a Chairperson and not more than two Members, to be appointed by that , for hearing appeals against the orders of the under this Act. (2) The Chairperson of the Appellate shall be a person who has been a Judge of or the Chief Justice of . (3) A Member of the Appellate shall be a person of ability, integrity and standing having special knowledge of, and professional experience of not less than twenty-five years in, science, technology, economics, banking, industry, law, matters relating to labour, industrial finance, industrial management, industrial reconstruction, administration, investment, accountancy, marketing or any other matter, the special knowledge of, or professional experience in which, would be in the opinion of the Central useful to the Appellate . ", "* * *[pic] 10-FT. Term of office of Chairperson and Members.\u2014The Chairperson or a ", "Member of shall hold office as such for a term of three years from the date on which he enters upon his office, but shall be eligible for reappointment for another term of three years: Provided that no Chairperson or other Member shall hold office as such after he has attained,\u2014 ", "(a) in the case of the Chairperson, the age of seventy years; ", "(b) in the case of any other Member, the age of sixty-seven years. ", "* * * 10-FX. Selection Committee.\u2014(1) The Chairperson and Members of the ", " and President and Members of the Tribunal shall be appointed by on the recommendations of a Selection Committee consisting of\u2014 ", "(a) Chief Justice of India or his nominee Chairperson; ", "(b) Secretary in and Company Affairs Member; ", "(c) Secretary in Member; ", "(d) Secretary in ( or ) Member; ", "(e) Secretary in and Company Affairs () Member. ", "(2) The Joint Secretary in the Ministry or Department of dealing with this Act shall be the Convenor of . ", "* * * (5) Before recommending any person for appointment as the Chairperson and Members of and President and Members of the Tribunal, shall satisfy itself that such person does not have financial or other interest which is likely to affect prejudicially his functions as such Chairperson or Member of or President or Member of the Tribunal, as the case may be. (6) No appointment of the Chairperson and Members of and President and Members of the Tribunal shall be invalidated merely by reason of any vacancy or any defect in the constitution of . ", "* * * 10-G. Power to punish for contempt.\u2014The Appellate Tribunal shall have ", "the same jurisdiction, powers and authority in respect of contempt of itself as has and may exercise, for this purpose under the provisions of the Contempt of Courts Act , 1971 , which shall have the effect subject to modifications that\u2014 ", "(a) the reference therein to shall be construed as including a reference to ; ", "(b) the reference to Advocate General in Section 15 of the said Act shall be construed as a reference to such law officers as may specify in this behalf. ", "* * * 10-GB. Civil court not to have jurisdiction.\u2014(1) No civil court shall ", "have jurisdiction to entertain any suit or proceeding in respect of any matter which the or the Appellate is empowered to determine by or under this Act or any other law for the time being in force and no injunction shall be granted by any court or other authority in respect of any action taken or to be taken in pursuance of any power conferred by or under this Act or any other law for the time being in force. ", "* * * 10-GF. Appeal to person aggrieved by any decision ", "or order of may file an appeal to within sixty days from the date of communication of the decision or order of to him on any question of law arising out of such decision or order: ", "Provided that may, if it is satisfied that the appellant was prevented by sufficient cause from filing the appeal within the said period, allow it to be filed within a further period not exceeding sixty days.\u201d Having noticed the relevant statutory provisions, this Court made detailed observations relating to \u201cdifference between Courts and Tribunals\u201d, \u201cRe: independence of judiciary\u201d, \u201cseparation of powers\u201d, and \u201cwhether the Government can transfer judicial functions traditionally performed by Courts, to Tribunals\u201d, as under:- ", "\u201c70. But in India, unfortunately tribunals have not achieved full independence. The Secretary of the \u201csponsoring department\u201d concerned sits in for appointment. When the tribunals are formed, they are mostly dependent on their sponsoring department for funding, infrastructure and even space for functioning. The statutes constituting tribunals routinely provide for members of civil services from the sponsoring departments becoming members of the tribunal and continuing their lien with their parent cadre. Unless wide ranging reforms as were implemented in United Kingdom and as were suggested by , , are brought about, tribunals in India will not be considered as independent. ", "Whether the Government can transfer the judicial functions traditionally performed by courts to tribunals? ", "71. It is well settled that courts perform all judicial functions of the except those that are excluded by law from their jurisdiction. Section 9 of the Code of Civil Procedure, for example, provides that the courts shall have jurisdiction to try all suits of a civil nature excepting suits of which their cognizance is either expressly or impliedly barred. ", "72. Article 32 provides that without prejudice to the powers conferred on by clauses (1) and (2) of the said Article, may by law, empower any other court to exercise within the local limits of its jurisdiction all or any of the powers exercisable by under clause (2) of Article 32. ", "73. Article 247 provides that notwithstanding anything contained in Chapter I of Part XI of the Constitution, may by law provide for the establishment of any additional courts for the better administration of laws made by or of any existing laws with respect to a matter enumerated in the Union List. Article 245 provides that subject to the provisions of the Constitution, may make laws for the whole or any part of the territory of India, and the legislature of a State may make laws for the whole or any part of the State. ", "74. Article 246 deals with the subject-matter of laws made by and by the legislatures of States. The Union List (List I of the Seventh Schedule) enumerates the matters with respect to which has exclusive powers to make laws. Entry 77 of List I refers to constitution, organisation, jurisdiction and powers of . Entry 78 of List I refers to constitution and organisation of . Entry 79 of List I refers to extension or exclusion of the jurisdiction of , to or from any Union Territory. Entry 43 of List I refers to incorporation, regulation and winding up of trading corporations and Entry 44 of List I refers to incorporation, regulation and winding up of corporations. Entry 95 of List I refers to jurisdiction and powers of all courts except , with respect to any of the matters in the Union List. ", "75. The Concurrent List (List III of the Seventh Schedule) enumerates the matters with respect to which and the of a State will have concurrent power to make laws. Entry 11-A of List III refers to administration of justice, constitution and organization of all courts except and . Entry 46 of List III refers to jurisdiction and powers of all courts, except , with respect to any of the matters in List III. ", "76. Part XIV-A was inserted in the Constitution with effect from 3-1-1977 by the Constitution (Forty-second Amendment) Act, 1976. The said part contains two articles. Article 323-A relates to and empowers to make a law, providing for the adjudication or trial by of disputes and complaints with respect to recruitment and conditions of service of persons appointed to public services [pic]and posts in connection with the affairs of the or of any State or of any local or other authority within the territory of India or under the control of the of India or of any corporation owned or controlled by the . ", "xxx xxx xxx ", "80. The legislative competence of to provide for creation of courts and tribunals can be traced to Entries 77, 78, 79 and Entries 43, 44 read with Entry 95 of List I, Entry 11-A read with Entry 46 of List III of the Seventh Schedule. Referring to these articles, this in two cases, namely, Bar Assn., , and , , held that Articles 323-A and 323-B are enabling provisions which enable the setting up of tribunals contemplated therein; and that the said articles, however, cannot be interpreted to mean that they prohibited the legislature from establishing tribunals not covered by those articles, as long as there is legislative competence under the appropriate entry in the Seventh Schedule. ", "xxx xxx xxx ", "90. But when we say that the legislature has the competence to make laws, providing which disputes will be decided by courts, and which disputes will be decided by tribunals, it is subject to constitutional limitations, without encroaching upon the independence of the judiciary and keeping in view the principles of the rule of law and separation of powers. If tribunals are to be vested with judicial power hitherto vested in or exercised by courts, such tribunals should possess the independence, security and capacity associated with courts. If the tribunals are intended to serve an area which requires specialised knowledge or expertise, no doubt there can be technical members in addition to judicial members. Where however jurisdiction to try certain category of cases are transferred from courts to tribunals only to expedite the hearing and disposal or relieve from the rigours of the Evidence Act and procedural laws, there is obviously no need to have any non-judicial technical member. In respect of such tribunals, only members of the judiciary should be the Presiding Officers/Members. Typical examples of such special tribunals are Rent Tribunals, Motor Accidents Claims Tribunals and under several enactments. Therefore, when transferring the jurisdiction exercised by courts to tribunals, which does not involve any specialised knowledge or expertise in any field and expediting the disposal and relaxing the procedure is the only object, a provision for technical members in addition to or in substitution of judicial members would clearly be a case of dilution of and encroachment upon the independence of the judiciary and the rule of law and would be unconstitutional. ", "91 , , this Court observed: (SCC pp. 169-70, para 67) \u201c67. The tribunals set up under Articles 323-A and 323-B of the Constitution or under an Act of legislature are creatures of the statute and in no case claim the status as Judges of or parity or as substitutes. However, the personnel appointed to hold those offices under the are called upon to discharge judicial or quasi-judicial powers. So they must have judicial approach and also knowledge and expertise in that particular branch of constitutional, administrative and tax laws. The legal input would undeniably be more important and sacrificing the legal [pic]input and not giving it sufficient weightage and teeth would definitely impair the efficacy and effectiveness of the judicial adjudication. It is, therefore, necessary that those who adjudicate upon these matters should have legal expertise, judicial experience and modicum of legal training as on many an occasion different and complex questions of law which baffle the minds of even trained Judges in and would arise for discussion and decision.\u201d ", "92. Having held that legislation can transfer certain areas of litigation from courts to tribunals and recognising that the legislature can provide for technical members in addition to judicial members in such tribunals, let us turn our attention to the question as to who can be the members. ", "93. If the Act provides for a tribunal with a judicial member and a technical member, does it mean that there are no limitations upon the power of the legislature to prescribe the qualifications for such technical member? The question will also be whether any limitations can be read into the competence of the legislature to prescribe the qualification for the judicial member? The answer, of course, depends upon the nature of jurisdiction that is being transferred from the courts to tribunals. Logically and necessarily, depending upon whether the jurisdiction is being shifted from , or or a Civil Judge, the yardstick will differ. It is for the court which considers the challenge to the qualification, to determine whether the legislative power has been exercised in a manner in consonance with the constitutional principles and constitutional guarantees. ", "xxx xxx xxx ", "101. Independent judicial tribunals for determination of the rights of citizens, and for adjudication of the disputes and complaints of the citizens, is a necessary concomitant of the rule of law. The rule of law has several facets, one of which is that disputes of citizens will be decided by Judges who are [pic]independent and impartial; and that disputes as to legality of acts of the Government will be decided by Judges who are independent of the executive. Another facet of the rule of law is equality before law. The essence of the equality is that it must be capable of being enforced and adjudicated by an independent judicial forum. Judicial independence and separation of judicial power from the executive are part of the common law traditions implicit in a Constitution like ours which is based on the model. ", "102. The fundamental right to equality before law and equal protection of laws guaranteed by Article 14 of the Constitution, clearly includes a right to have the person\u2019s rights, adjudicated by a forum which exercises judicial power in an impartial and independent manner, consistent with the recognised principles of adjudication. Therefore wherever access to courts to enforce such rights is sought to be abridged, altered, modified or substituted by directing him to approach an alternative forum, such legislative Act is open to challenge if it violates the right to adjudication by an independent forum. Therefore, though the challenge by is on the ground of violation of principles forming part of the basic structure, they are relatable to one or more of the express provisions of the Constitution which gave rise to such principles. Though the validity of the provisions of a legislative Act cannot be challenged on the ground it violates the basic structure of the Constitution, it can be challenged as violative of constitutional provisions which enshrine the principles of the rule of law, separation of powers and independence of the judiciary. ", "xxx xxx xxx ", "106. We may summarise the position as follows: ", "(a) A legislature can enact a law transferring the jurisdiction exercised by courts in regard to any specified subject (other than those which are vested in courts by express provisions of the Constitution) to any tribunal. ", "(b) All courts are tribunals. Any tribunal to which any existing jurisdiction of courts is transferred should also be a judicial tribunal. This means that such tribunal should have as members, persons of a rank, capacity and status as nearly as possible equal to the rank, status and capacity of the court which was till then dealing with such matters and the members of the tribunal should have the independence and security of tenure associated with judicial tribunals. ", "(c) Whenever there is need for \u201ctribunals\u201d, there is no presumption that there should be technical members in the tribunals. When any jurisdiction is shifted from courts to tribunals, on the ground of pendency and delay in courts, and the jurisdiction so transferred does not involve any technical aspects requiring the assistance of experts, the tribunals should normally have only judicial members. Only where the exercise of jurisdiction involves inquiry and decisions into technical or special [pic]aspects, where presence of technical members will be useful and necessary, tribunals should have technical members. Indiscriminate appointment of technical members in all tribunals will dilute and adversely affect the independence of the judiciary. ", "(d) The legislature can reorganise the jurisdictions of judicial tribunals. For example, it can provide that a specified category of cases tried by a higher court can be tried by a lower court or vice versa (a standard example is the variation of pecuniary limits of the courts). Similarly while constituting tribunals, the legislature can prescribe the qualifications/eligibility criteria. The same is however subject to judicial review. If the court in exercise of judicial review is of the view that such tribunalisation would adversely affect the independence of the judiciary or the standards of the judiciary, the court may interfere to preserve the independence and standards of the judiciary. Such an exercise will be part of the checks and balances measures to maintain the separation of powers and to prevent any encroachment, intentional or unintentional, by either the legislature or by the executive. ", "xxx xxx xxx ", "113. When were constituted, the presence of members of civil services as Technical (Administrative) Members was considered necessary, as they were well versed in the functioning of government departments and the rules and procedures applicable to government servants. But the fact that senior officers of civil services could function as Administrative Members of , does not necessarily make them suitable to function as technical members in or other tribunals requiring technical expertise. The tribunals cannot become providers of sinecure to members of civil services, by appointing them as technical members, though they may not have technical expertise in the field to which the tribunals relate, or worse, where purely judicial functions are involved. While one can understand the presence of the members of the civil services being technical members in , or Military Officers being members of , or electrical engineers being members of , or telecom engineers being members of , we find no logic in members of the general civil services being members of . ", "114. Let us now refer to the dilution of independence. If any member of the tribunal is permitted to retain his lien over his post with the parent cadre or ministry or department in the civil service for his entire period of service as member of the tribunal, he would continue to think, act and function as a member of the civil services. A litigant may legitimately think that such a member will not be independent and impartial. We reiterate that our observations are not intended to cast any doubt about the honesty and integrity or capacity and capability of the officers of civil services in particular those who are of the rank of Joint Secretary or for that matter even junior officers. What we are referring to is the perception of the litigants and the public about the independence or conduct of the members of the tribunal. Independence, impartiality and fairness are qualities which have to be nurtured and developed and cannot be acquired overnight. The independence of members discharging judicial functions in a tribunal cannot be diluted. ", "xxx xxx xxx ", "120. We may tabulate the corrections required to set right the defects in Parts I-B and I-C of the Act: ", "(i) Only Judges and advocates can be considered for appointment as judicial members of the . Only Judges, or Judges who have served in the rank of a District Judge for at least five years or a person who has practised as a lawyer for ten years can be considered for appointment as a judicial member. Persons who have held a Group A or equivalent post under with experience in (Legal Branch) and (Grade I) cannot be considered for appointment as judicial members as provided in sub-sections (2)(c) and (d) of Section 10-FD . The expertise in or will at best enable them to be considered for appointment as technical members. ", "(ii) As takes over the functions of , the members should as nearly as possible have the same position and status as Judges. This can be achieved, not by giving the salary and perks of a Judge to the members, but by ensuring that persons who are as nearly equal in rank, experience or competence to Judges are appointed as members. Therefore, only officers who are holding the ranks of Secretaries or Additional Secretaries alone can be considered for appointment as technical members of . Clauses (c) and (d) of sub-section (2) and clauses (a) and (b) of sub- section (3) of Section 10-FD which provide for persons with 15 years experience in Group A post or persons holding the post of Joint Secretary or equivalent post in the or , being qualified for appointment as Members of , are invalid. ", "(iii) A \u201ctechnical member\u201d presupposes an experience in the field to which the relates. A member of who has worked with or officers in other departments who might have incidentally dealt with some aspect of company law cannot be considered as \u201cexperts\u201d qualified to be appointed as technical members. Therefore clauses ", "(a) and (b) of sub-section (3) are not valid. ", "(iv) The first part of clause (f) of sub-section (3) providing that any person having special knowledge or professional experience of 20 years in science, technology, economics, banking, industry could be considered to be persons with expertise in company law, for being appointed as technical members in , is invalid. ", "(v) Persons having ability, integrity, standing and special knowledge and professional experience of not less than fifteen years in industrial finance, industrial management, industrial reconstruction, investment and accountancy, may however be considered as persons having expertise in [pic]rehabilitation/revival of companies and therefore, eligible for being considered for appointment as technical members. ", "(vi) In regard to category of persons referred in clause (g) of sub-section (3) at least five years\u2019 experience should be specified. ", "(vii) Only clauses (c), (d), (e), (g), (h), and the latter part of clause ", "(f) in sub-section (3) of Section 10-FD and officers of civil services of the rank of the Secretary or Additional Secretary in and can be considered for purposes of appointment as technical members of the . ", "(viii) Instead of a five-member Selection Committee with the Chief Justice of India (or his nominee) as Chairperson and two Secretaries from and the Secretary in and the Secretary in as members mentioned in Section 10-FX , should broadly be on the following lines: ", "(a) Chief Justice of India or his nominee\u2014Chairperson (with a casting vote); ", "(b) A Senior Judge of or Chief Justice of \u2014Member; ", "(c) Secretary in \u2014Member; and ", "(d) Secretary in \u2014Member. ", "(ix) The term of office of three years shall be changed to a term of seven or five years subject to eligibility for appointment for one more term. This is because considerable time is required to achieve expertise in the field concerned. A term of three years is very short and by the time the members achieve the required knowledge, expertise and efficiency, one term will be over. Further the said term of three years with the retirement age of 65 years is perceived as having been tailor-made for persons who have retired or shortly to retire and encourages these to be treated as post-retirement havens. If these are to function effectively and efficiently they should be able to attract younger members who will have a reasonable period of service. ", "(x) The second proviso to Section 10-FE enabling the President and members to retain lien with their parent cadre/ministry/department while holding office as President or Members will not be conducive for the independence of members. Any person appointed as member should be prepared to totally disassociate himself from the executive. The lien cannot therefore exceed a period of one year. ", "(xi) To maintain independence and security in service, sub-section (3) of Section 10-FJ and Section 10-FV should provide that suspension of the President/Chairman or member of a can be only with the concurrence of the Chief Justice of India. ", "(xii) The administrative support for all Tribunals should be from . Neither the Tribunals nor their members shall seek or be provided with facilities from the respective sponsoring or parent Ministries or Department concerned. ", "(xiii) Two-member Benches of the should always have a judicial member. Whenever any larger or special Benches are constituted, the number of technical members shall not exceed the judicial members.\u201d ", "62. Before venturing to examine the controversy in hand it needs to be noticed, that some of the assertions raised at the hands of the petitioners in the present controversy have since been resolved. These have been noticed in an order passed by this Court in , , which is being extracted hereunder:- \u201c1. In all these petitions, the constitutional validity of Act , 2005 (\u201cthe Act\u201d, for short) is challenged. In TC No. 150 of 2006, additionally there is a challenge to Section 46 of the Constitution (Forty-second Amendment) Act, 1976 and Article 323-B of the Constitution of India. It is contended that Section 46 of the Constitution (Forty-second Amendment) Act, is ultra vires the basic structure of the Constitution as it enables proliferation of the tribunal system and makes serious inroads into the independence of the judiciary by providing a parallel system of administration of justice, in which the executive has retained extensive control over matters such as appointment, jurisdiction, procedure, etc. It is contended that Article 323-B violates the basic structure of the Constitution as it completely takes away the jurisdiction of and vests them in , including trial of offences and adjudication of pure questions of law, which have always been in the exclusive domain of the judiciary. ", "2. When these matters came up on 9-1-2007 before a three-Judge Bench, the challenge to various sections of the Act was noticed. ", "3. The first challenge was to Section 13 which permitted \u201cany person\u201d duly authorised to appear before . submitted that the appropriate amendment will be made in the Act to ensure that only lawyers, chartered accountants and parties in person will be permitted to appear before . ", "4. The second challenge was to Section 5(5) of the Act which provided that: \u201c5. (5) The Central Government may in consultation with the Chairperson transfer a member from headquarters of one Bench in one State to the headquarters of another Bench in another State or to the headquarters of any other Bench within a State:\u201d ", "5. submitted that having regard to the nature of the functions to be performed by the and the constitutional scheme of separation of powers and independence of judiciary, the expression \u201cconsultation with the Chairperson\u201d occurring in Section 5(5) of the Act should be read and construed as \u201cconcurrence of the Chairperson\u201d. ", "6. The third challenge was to Section 7 which provided for a Selection Committee comprising of (a) the Chief Justice of India or a Judge of nominated by him, (b) Secretary in , and (c) Secretary in . It was contended by the petitioners that two of the members who are Secretaries to the Government forming the majority may override the opinion of the Chief Justice or his nominee which was improper. It was stated on behalf of that there was no question of two Secretaries overriding the opinion of the Chief Justice of India or his nominee since primacy of the Chairperson was inbuilt in the system and this aspect will be duly clarified. ", "7. In regard to certain other defects in the Act, pointed out by the petitioners, it was submitted that will examine them and wherever necessary suitable amendments will be made. ", "8. In view of these submissions, on 9-1-2007, this Court made an order reserving liberty to to mention the matter for listing after the appropriate amendments were made in the Act. ", "9. On 21-1-2009, when arguments in CA No. 3067 of 2004 and CA No. 3717 of 2005, which related to the challenge to Parts I-B and I-C of the Companies Act, 1956 were in progress before , it was submitted that these matters involved a similar issue and they could be tagged and disposed of in terms of the decision in those appeals. Therefore directed these cases to be listed with those appeals, even though there is no order of reference in these matters. CA No. 3067 of 2004 and CA No. 3717 of 2005 were subsequently heard at length and were reserved for judgment. These matters which were tagged were also reserved for judgment. ", "10. We have disposed of CA No. 3067 of 2004 and CA No. 3717 of 2005 today ( , ), by a separate order. Insofar as these cases are concerned, we find that TC (Civil) No. 150 of 2006 involves the challenge to Article 323-B of the Constitution. The said article enables appropriate legislatures to provide by law, for adjudication or trial by tribunals or any disputes, complaints, or offences with respect to all or any of the matters specified in clause (2) thereof. Sub-clause (i) of clause (2) of Article 323-B enables such tribunals to try offences against laws with respect to any of the matters specified in sub- clauses (a) to (h) of clause (2) of the said article. ", "11. One of the contentions urged in support of the challenge to Article 323- B relate to the fact that tribunals do not follow the normal rules of evidence contained in the Evidence Act , 1872. In criminal trials, an accused is presumed to be innocent till proved guilty beyond reasonable doubt, and the Evidence Act plays an important role, as appreciation of evidence and consequential findings of facts are crucial. The trial would require experience and expertise in criminal law, which means that the Judge or the adjudicator to be legally trained. Tribunals which follow their own summary procedure, are not bound by the strict rules of evidence and the members will not be legally trained. Therefore it may lead to convictions of persons on evidence which is not sufficient in probative value or on the basis of inadmissible evidence. It is submitted that it would thus be a retrograde step for separation of executive from the judiciary. ", "12. Appeals on issues on law are traditionally heard by the courts. Article 323-B enable constitution of tribunals which will be hearing appeals on pure questions of law which is the function of the courts. , , this Court considered the validity of only clause (3)(d) of Article 323-B but did not consider the validity of other provisions of Article 323-B. ", "13. The appeals relating to constitutional validity of the National Company Law Tribunals under the Companies Act , 1956 did not involve the consideration of Article 323-B. The constitutional issues raised in TC (Civil) No. 150 of 2006 were not touched on as the power to establish Company Tribunals was not traceable to Article 323-B but to several entries of Lists I and III of the Seventh Schedule and consequently there was no challenge to this article. ", "14. The basis of attack in regard to Parts I-B and I-C of the Companies Act and the provisions of the NTT Act are completely different. The challenge to Parts I-B and I-C of the Companies Act, 1956 seeks to derive support from Article 323-B by contending that Article 323-B is a bar for constitution of any tribunal in respect of matters not enumerated therein. On the other hand the challenge to the NTT Act is based on the challenge to Article 323-B itself. ", "15. We therefore find that these petitions relating to the validity of the NTT Act and the challenge to Article 323-B raise issues which did not arise in the two civil appeals. Therefore these cases cannot be disposed of in terms of the decision in the civil appeals but require to be heard separately. We accordingly direct that these matters be delinked and listed separately for hearing.\u201d 63(i) A perusal of the judgment rendered in case (supra) reveals, that \u201cseparation of powers\u201d creates a system of checks and balances, by reasons of which, powers are so distributed, that none of the three organs transgresses into the domain of the other. The concept ensures the dignity of the individual. The power of \u201cjudicial review\u201d ensures, that executive functioning confines itself within the framework of law enacted by the legislature. Accordingly, the demarcation of powers between the legislature, the executive and the judiciary, is regarded as the basic element of the constitutional scheme. When the judicial process is prevented by law, from determining whether the action taken, was or was not, within the framework of the legislation enacted, it would amount to the transgression of the adjudicatory/determinatory process by the legislature. Therefore, the exclusion of the power of \u201cjudicial review\u201d, would strike at the \u201cbasic structure\u201d of the Constitution. ", "(ii) In case (supra), this arrived at the conclusion, that clause (4) of Article 329A of the Constitution, destroyed not only the power of \u201cjudicial review\u201d, but also the rule of \u201cseparation of powers\u201d. By the above legislative provision, an election declared void, on the culmination of an adjudicatory process, was treated as valid. Meaning thereby, that the judicial process was substituted by a legislative pronouncement. It was held, that the issue to be focused on was, whether the amendment which was sought to be assailed, violated a principle which constituted the \u201cbasic structure\u201d of the Constitution. The argument raised in opposition was, that a determination which had a bearing on just one (or a few) individual(s) would not raise such an issue. The query was answered by concluding, that it would make no difference whether it related to one case, or a large number of cases. Encroachment on the \u201cbasic structure\u201d of the Constitution would be invalid, irrespective of whether, it related to a limited number of individuals or a large number of people. The view expressed was, that if lawmakers were to be assigned the responsibility of administering those laws, and dispensing justice, then those governed by such laws would be left without a remedy in case they were subjected to injustice. For the above reason, clause (4) of Article 329A was declared invalid. This by majority held, that clauses (4) and (5) of Article 329A were unconstitutional and void. ", "(iii) In case (supra), first and foremost, this Court confirmed the view expressed in case (supra) and case (supra), that the amending power of the , was not absolute. The , it was maintained, did not have the power to amend the \u201cbasic structure\u201d of the Constitution. A legislative assertion, that the enacted law had been made, for giving effect to a policy to secure the provisions made in Part IV of the Constitution, had the effect of excluding the adjudicatory process. In the case on hand, this Court arrived at the conclusion, that Section 4 of the Constitution (Forty-second Amendment) Act was beyond the amending power of the , and the same was void, because it had the effect of damaging the basic and essential features of the Constitution and destroying its \u201cbasic structure\u201d, by totally excluding any challenge to any law, even on the ground, whether it was inconsistent with or it had abridged, any of the rights conferred by Articles 14 and 19 of the Constitution. Furthermore, Section 55 of the Constitution (Forty-second Amendment), Act was held to be beyond the amending power of the . It was held to be void, as it had the effect of removing all limitations on the powers of , to amend the Constitution including, the power to alter its basic and essential features, i.e., its \u201cbasic structure\u201d. According to this Court, the reason for a broad \u201cseparation of powers\u201d under the Constitution was, because concentration of powers in any one of the organs of the Government, would destroy the foundational premise of a democratic Government. The illustrations narrated in the judgment are of some relevance. We shall therefore, narrate them hereunder, in our own words: ", "(a) Take for example a case where the executive, which is in-charge of administration, acts to the prejudice of a citizen. And a question arises, as to what are the powers of the executive, and whether the executive had acted within the scope of its powers. Such a question obviously, cannot be left to the executive to decide, for two very good reasons. Firstly, because the decision would depend upon the interpretation of the Constitution or the laws, which are, pre-eminently fit to be decided by the judiciary, as it is the judiciary alone which would be possessed of the expertise in decision making. And secondly, because the legal protection afforded to citizens by the Constitution or the laws would become illusory, if it were left to the executive to determine the legality, of its own actions. ", "(b) Take for example, a case where the legislature makes a law, which is to the prejudice of a citizen. And a dispute arises, whether in making the law the legislature had acted outside the area of its legislative competence, or whether the law was violative of the fundamental rights of the citizen, or of some other provision(s) of law. Its resolution cannot be left to the legislature to decide, for two very good reasons. Firstly, because the decision would depend upon the interpretation of the Constitution or the laws, which are, pre-eminently fit to be decided by the judiciary, as it is the judiciary alone which would be possessed of the expertise in decision making. And secondly, because the legal protection afforded to citizens, by the Constitution or the laws would become illusory, if it were left to the legislature to determine the legality of its own actions. ", "On the basis of the examples cited above, this Court concluded, that the creation of an independent machinery, for resolving disputes, was constitutionally vested with the judiciary. The judiciary was vested with the power of \u201cjudicial review\u201d, to determine the legality of executive action, and the validity of laws enacted by legislature. It was further held, that it was the solemn duty of the judiciary under the Constitution, to keep the different organs of the , such as the executive and the legislature, within the limits of the powers conferred upon them by the Constitution. It was accordingly also held, that the power of \u201cjudicial review\u201d was an integral part of India\u2019s constitutional system, and without it, the \u201crule of law\u201d would become a teasing illusion, and a promise of unreality. Premised on the aforesaid inferences, this Court finally concluded, that if there was one feature of the Indian Constitution, which more than any others, was its \u201cbasic structure\u201d fundamental to the maintenance of democracy and the \u201crule of law\u201d, it was the power of \u201cjudicial review\u201d. While recording the aforementioned conclusion, this Court also recorded a clarificatory note, namely, that it should not be taken, that an effective alternative institutional mechanism or arrangement for \u201cjudicial review\u201d could not be made by . It was, however, clearly emphasized, that \u201cjudicial review\u201d was a vital principle of the Indian Constitution, and it could not be abrogated, without affecting the \u201cbasic structure\u201d of the Constitution. It is therefore, that it came to be held, that a constitutional amendment, which had the effect of taking away the power of \u201cjudicial review\u201d, by providing, that it would not be liable to be questioned, on any ground, was held to be beyond the amending power of the . For, that would make the the sole judge, of the constitutional validity, of what it had done, and thereby, allow it to determine the legality of its own actions. In the above judgment, the critical reflection, in our considered view was expressed by the words, \u201cHuman ingenuity, limitless though it may be, has yet not devised a system, by which the liberty of the people can be protected, except for the intervention of the courts of law\u201d. ", "(iv) In case (supra), the concept of \u201cindependence of judiciary\u201d came up for consideration before this Court. This Court having examined the issue, arrived at certain conclusions with reference to and Judges. It was held, that their appointment and removal, as also their transfer, deserved to be preserved, within the framework of the judicial fraternity. Likewise, the foundation of appointment of outside Chief Justices, was made with a similar objective. Based on the same, parameters were also laid down, in respect of appointment of Judges to the . The consideration even extended to the appointment of the Chief Justice of the . All this, for ensuring judicial autonomy. It was felt that independence of the judiciary, could be preserved only if primacy in the above causes rested with the judiciary itself, with a minimal involvement of the executive and the legislature. It needs to be highlighted, that independence of judges of the s and the was considered as salient, to ensure due exercise of the power of \u201cjudicial review\u201d. It would be pertinent to mention, that the judgment rendered by this Court in case (supra) came to be doubted in , (1991) Suppl. 1 SCC 574. Thereupon, the matter was reconsidered by a constitution bench of nine Judges in, Advocates on , . On the subject of preserving independence in respect of appointment of judges of the s, as also their transfer, the position recorded earlier in case (supra) remained substantially unaltered. So also, of appointments of Chief Justices of s and the . It was reiterated, that to ensure judicial independence, primacy in all these matters should be with the judiciary. ", "(v) Having recorded the determination rendered by this to the effect that \u201cseparation of powers\u201d, \u201crule of law\u201d and \u201cjudicial review\u201d at the hands of an independent judiciary, constitute the \u201cbasic structure\u201d of the Constitution, we are in a position now to determine, how the aforesaid concepts came to be adopted by this , while adjudicating upon the validity of provisions similar to the ones, which are subject of consideration, in the case on hand. The first controversy arose with reference to the Administrative Tribunals Act , 1985, which was enacted under Article 323A of the Constitution. In case (supra), it was sought to be concluded, that the power of \u201cjudicial review\u201d had been negated by the aforementioned enactment, inasmuch as, the avenue of redress under Articles 226 and 227 of the Constitution before , was no longer available. It was also sought to be asserted, that the tribunal constituted under the enactment, being a substitute of , ought to have been constituted in a manner, that it would be able to function in the same manner as itself. Since insulation of the judiciary from all forms of interference, even from the coordinate branches of the Government, was by now being perceived as a basic essential feature of the Constitution, it was felt that the same independence from possibility of executive pressure or influence, needed to be ensured for the Chairman, Vice Chairman and Members of the administrative tribunal. In recording its conclusions, even though it was maintained, that \u201cjudicial review\u201d was an integral part of the \u201cbasic structure\u201d of the Constitution, yet it was held, that was competent to amend the Constitution, and substitute in place of , another alternative institutional mechanism or arrangement. This , however cautioned, that it was imperative to ensure, that the alternative arrangement, was no less independent, and no less judicious, than (which was sought to be replaced) itself. This was conveyed by observing, \u201cif any constitutional amendment made by the takes away from the power of \u201cjudicial review\u201d in any particular area, and vests it in any other institutional mechanism or authority, it would not be violative of the basic structure doctrine so long as the essential condition is fulfilled, namely, that the alternative institutional mechanism or authority set up by the by amendment is no less effective than \u201d. The exclusion of s\u2019 jurisdiction under Articles 226 and 227 of the Constitution, it was held, would render the Administrative Tribunals Act , 1985 unconstitutional, unless the amendments to the provisions of Sections 4 , 6 and 8 thereof, as suggested by this , were carried out. Insofar as Section 4 is concerned, it was suggested that it must be amended so as not to confer absolute and unfettered discretion on the executive in matters of appointment of the Chairman, Vice Chairman and Members of the administrative tribunals. Section 6(1)(c) was considered to be invalid, and as such, needed to be deleted. It was also indicated, that appointment of Chairman, Vice Chairman and Administrative Members should be made by the executive, only in consultation with the Chief Justice of India, and that, such consultation had to be meaningful and effective, inasmuch as, ordinarily the recommendation of the Chief Justice of India ought to be accepted, unless there were cogent reasons not to. If there were any reasons, for not accepting the recommendation, they needed to be disclosed to the Chief Justice. Alternatively, it was commended, that a high powered headed by the Chief Justice or a sitting Judge of the Supreme , or of the concerned High (nominated by the Chief Justice of India), could be set up for such selection. If either of these two modes of appointment was adopted, it was believed, that the impugned Act would be saved from invalidation. It was mentioned, that Section 6(2) also needed to be amended, so as to make a District Judge or an Advocate, who fulfilled the qualifications for appointment as a judge of , eligible for appointment as Vice Chairman. With reference to Section 8 it was felt, that a term of five years of office, would be too short and ought to be suitably extended. It was so felt, because the presently prescribed tenure would neither be convenient to the persons selected for the job, nor expedient to the scheme of adjudication contemplated under the Administrative Tribunals Act . It was also opined, that the Government ought to set up a permanent bench wherever there was a seat of . And if that was not feasible, at least a circuit bench of the administrative tribunal, wherever there is a seat of . That would alleviate the hardship, which would have to be faced by persons, who were not residing close to the places at which the benches of the tribunal were set up. In this behalf, it may only be stated that all the suggestions made by this were adopted. ", "(vi) Post case (supra), divergent views came to be expressed in a number of judgments rendered by this Court. It is therefore, that the judgment in case (supra), came up for reconsideration in case (supra). On reconsideration, this Court declared, that the power of \u201cjudicial review\u201d over legislative action was vested in under Article 226 , and in under Article 32 of the Constitution. \u201cJudicial review\u201d was again held to be an integral and essential feature of the Constitution, constituting its \u201cbasic structure\u201d. It was further concluded, that ordinarily the power of and , to test the constitutional validity of legislations, could never be ousted or excluded. It was also held, that the power vested in of judicial superintendence over all and tribunals within their respective jurisdictions, was also part of the \u201cbasic structure\u201d of the Constitution. And that, a situation needed to be avoided where were divested from their judicial functions, besides the power of constitutional interpretation. Referring to the inappropriate and ineffective functioning of the tribunals, this Court observed, that the above malady was on account of lack of the responsibility, of fulfilling the administrative requirements of administrative tribunals. It was opined, that the malady could be remedied by creating a single umbrella organization, to ensure the independence of the members of such tribunals, and to provide funds for the fulfillment of their administrative requirements. Although the determination of the governmental organization, to discharge such a role was left open, it was recommended, that it should preferably be vested with . With reference to the controversies which arose before the tribunals, it was held, that matters wherein interpretation of statutory provisions or rules, or where the provisions of the Constitution were expected to be construed, the same would have to be determined by a bench consisting of at least two Members, one of whom must be a Judicial Member. Having found that the provisions of the Administrative Tribunals Act , had impinged on the power of \u201cjudicial review\u201d vested in the , clause (2)(d) of Article 323A and clause (3)(d) of Article 323B , to the extent they excluded the jurisdiction of and under Articles 226/227 and 32 of the Constitution, were held to be unconstitutional. Likewise, the \u201cexclusion of jurisdiction\u201d clauses in all other legislations enacted under the aegis of Articles 323A and 323B, were also held to be unconstitutional. In view of the above, it was concluded, that the jurisdiction conferred upon the under Articles 226/227, and upon under Article 32 of the Constitution, was a part of the inviolable \u201cbasic structure\u201d of the Constitution. Since the said jurisdiction could not be ousted, jurisdiction vested in the tribunals would be deemed to be discharging a supplemental role, in the exercise of the powers conferred by Articles 226/227 and 32 of the Constitution. Although it was affirmed, that such tribunals would be deemed to be possessed of the competence to test the constitutional validity of the statutory provisions and rules, it was provided, that all decisions of tribunals would be subject to scrutiny before a division bench of the , within whose jurisdiction the concerned tribunal had passed the order. In the above view of the matter, it was held that the tribunals would act like courts of first instance, in respect of the areas of law, for which they had been constituted. After adjudication at the hands of the tribunals, it would be open for litigants to directly approach . Section 5(6) of the Administrative Tribunals Act, interpreted in the manner indicated above, was bestowed with validity. ", "(vii) case (supra), all the conclusions/propositions narrated above, were reiterated and followed, whereupon the fundamental requirements, which need to be kept in mind while transferring adjudicatory functions from courts to tribunals, were further crystalised. It came to be unequivocally recorded that tribunals vested with judicial power (hitherto before vested in, or exercised by courts), should possess the same independence, security and capacity, as the courts which the tribunals are mandated to substitute. The Members of the tribunals discharging judicial functions, could only be drawn from sources possessed of expertise in law, and competent to discharge judicial functions. Technical Members can be appointed to tribunals where technical expertise is essential for disposal of matters, and not otherwise. Therefore it was held, that where the adjudicatory process transferred to tribunals, did not involve any specialized skill, knowledge or expertise, a provision for appointment of Technical Members (in addition to, or in substitution of Judicial Members) would constitute a clear case of delusion and encroachment upon the independence of the judiciary, and the \u201crule of law\u201d. The stature of the members, who would constitute the tribunal, would depend on the jurisdiction which was being transferred to the tribunal. In other words, if the jurisdiction of was transferred to a tribunal, the stature of the members of the newly constituted tribunal, should be possessed of qualifications akin to the judges of . Whereas in case, the jurisdiction and the functions sought to be transferred were being exercised/performed by District Judges, the Members appointed to the tribunal should be possessed of equivalent qualifications and commensurate stature of District Judges. The conditions of service of the members should be such, that they are in a position to discharge their duties in an independent and impartial manner. The manner of their appointment and removal including their transfer, and tenure of their employment, should have adequate protection so as to be shorn of legislative and executive interference. The functioning of the tribunals, their infrastructure and responsibility of fulfilling their administrative requirements ought to be assigned to . Neither the tribunals nor their members, should be required to seek any facilities from the parent ministries or department concerned. Even though the legislature can reorganize the jurisdiction of judicial tribunals, and can prescribe the qualifications/eligibility of members thereof, the same would be subject to \u201cjudicial review\u201d wherein it would be open to a court to hold, that the tribunalization would adversely affect the adjudicatory standards, whereupon it would be open to a court to interfere therewith. Such an exercise would naturally be, a part of the checks and balances measures, conferred by the Constitution on the judiciary, to maintain the rule of \u201cseparation of powers\u201d to prevent any encroachment by the legislature or the executive. ", "64. The position of law summarized in the foregoing paragraph constitutes a declaration on the concept of the \u201cbasic structure\u201d, with reference to the concepts of \u201cseparation of powers\u201d, the \u201crule of law\u201d, and \u201cjudicial review\u201d. Based on the conclusions summarized above, it will be possible for us to answer the first issue projected before us, namely, whether \u201cjudicial review\u201d is a part of the \u201cbasic structure\u201d of the Constitution. The answer has inevitably to be in the affirmative. From the above determination, the petitioners would like us to further conclude, that the power of \u201cjudicial review\u201d stands breached with the promulgation of the Act. This in case (supra) held, that it should not be taken, that an effective alternative institutional mechanism or arrangement for \u201cjudicial review\u201d could not be made by . The same position was reiterated in case (supra), namely, that \u201cjudicial review\u201d was an integral part of the \u201cbasic structure\u201d of the Constitution. All the same it was held, that was competent to amend the Constitution, and substitute in place of the High , another alternative institutional mechanism (court or tribunal). It would be pertinent to mention, that in so concluding, this added a forewarning, that the alternative institutional mechanism set up by through an amendment, had to be no less effective than the High itself. In case (supra), even though this held that the power of \u201cjudicial review\u201d over legislative action vested in High s, was a part of the \u201cbasic structure\u201d, it went on to conclude that \u201cordinarily\u201d the power of High s to test the constitutional validity of legislations could never be ousted. All the same it was held, that the powers vested in High s to exercise judicial superintendence over decisions of all courts and tribunals within their respective jurisdictions, was also a part of the \u201cbasic structure\u201d of the Constitution. The position that had the power to amend the Constitution, and to create a court/tribunal to discharge functions which the High was discharging, was reiterated, in case (supra). It was concluded, that the was competent to enact a law, transferring the jurisdiction exercised by High s, in regard to any specified subject, to any court/tribunal. But it was clarified, that could not transfer power vested in the High s, by the Constitution itself. We therefore have no hesitation in concluding, that appellate powers vested in the High under different statutory provisions, can definitely be transferred from the High to other courts/tribunals, subject to the satisfaction of norms declared by this . Herein the jurisdiction transferred by the Act was with regard to specified subjects under tax related statutes. That, in our opinion, would be permissible in terms of the position expressed above. Has the Act transferred any power vested in courts by the Constitution? The answer is in the negative. The power of \u201cjudicial review\u201d vested in the High under Articles 226 and 227 of the Constitution, has remained intact. This aspect of the matter, has a substantial bearing, to the issue in hand. And will also lead to some important inferences. Therefore, it must never be overlooked, that since the power of \u201cjudicial review\u201d exercised by the High under Articles 226 and 227 of the Constitution has remained unaltered, the power vested in High s to exercise judicial superintendence over the benches of the within their respective jurisdiction, has been consciously preserved. This position was confirmed by the learned Attorney General for India, during the course of hearing. Since the above jurisdiction of the High has not been ousted, the will be deemed to be discharging a supplemental role, rather than a substitutional role. In the above view of the matter, the submission that the Act violates the \u201cbasic structure\u201d of the Constitution, cannot be acquiesced to. ", "65. Even though we have declined to accept the contention advanced on behalf of the petitioners, premised on the \u201cbasic structure\u201d theory, we feel it is still essential for us, to deal with the submission advanced on behalf of the respondents in response. We may first record the contention advanced on behalf of the respondents. It was contended, that a legislation (not being an amendment to the Constitution), enacted in consonance of the provisions of the Constitution, on a subject within the realm of the concerned legislature, cannot be assailed on the ground that it violates the \u201cbasic structure\u201d of the Constitution. For the present controversy, the respondents had placed reliance on Articles 245 and 246 of the Constitution, as also, on entries 77 to 79, 82 to 84, 95 and 97 of the Union List of the Seventh Schedule, and on entries 11A and 46 of the Concurrent List of the Seventh Schedule. Based thereon it was asserted, that was competent to enact the NTT Act. For examining the instant contention, let us presume it is so. Having accepted the above, our consideration is as follows. The Constitution regulates the manner of governance in substantially minute detail. It is the fountainhead distributing power, for such governance. The Constitution vests the power of legislation at the , with and , and in the States with (and in some States, , as well). The instant legislative power is regulated by \u201cPart XI\u201d of the Constitution. The submission advanced at the hands of the learned counsel for the respondents, insofar as the instant aspect of the matter is concerned, is premised on the assertion that the NTT Act has been enacted strictly in consonance with the procedure depicted in \u201cPart XI\u201d of the Constitution. It is also the contention of the learned counsel for the respondents, that the said power has been exercised strictly in consonance with the subject on which the is authorized to legislate. Whilst dealing with the instant submission advanced at the hands of the learned counsel for the respondents, all that needs to be stated is, that the legislative power conferred under \u201cPart XI\u201d of the Constitution has one overall exception, which undoubtedly is, that the \u201cbasic structure\u201d of the Constitution, cannot be infringed, no matter what. On the instant aspect, some relevant judgments, rendered by constitutional benches of this Court, have been cited hereinabove. It seems to us, that there is a fine difference in what the petitioners contend, and what the respondents seek to project. The submission advanced at the hands of the learned counsel for the petitioners does not pertain to lack of jurisdiction or inappropriate exercise of jurisdiction. The submission advanced at the hands of the learned counsel for the petitioners pointedly is, that it is impermissible to legislate in a manner as would violate the \u201cbasic structure\u201d of the Constitution. This Court has repeatedly held, that an amendment to the provisions of the Constitution, would not be sustainable if it violated the \u201cbasic structure\u201d of the Constitution, even though the amendment had been carried out, by following the procedure contemplated under \u201cPart XI\u201d of the Constitution. This leads to the determination, that the \u201cbasic structure\u201d is inviolable. In our view, the same would apply to all other legislations (other than amendments to the Constitution) as well, even though the legislation had been enacted by following the prescribed procedure, and was within the domain of the enacting legislature, any infringement to the \u201cbasic structure\u201d would be unacceptable. Such submissions advanced at the hands of the learned counsel for the respondents are, therefore, liable to be disallowed. And are accordingly declined. ", "II. Whether the transfer of adjudicatory functions vested in to the violates recognized constitutional conventions? ", "III. Whether while transferring jurisdiction to a newly created court/tribunal, it is essential to maintain the standards and the stature of the court replaced? ", "66. In addition to the determination on the adjudication of the present controversy on the concept of basic structure, the instant matter calls for a determination on the sustainability of the NTT Act, from other perspectives also. We shall now advert to the alternative contentions. First and foremost, it was the submission of the learned counsel for the petitioners, that it is impermissible for legislature to abrogate/divest the core judicial appellate functions, specially, the functions traditionally vested in a superior court, to a quasi judicial authority devoid of essential ingredients of the superior court. The instant submission was premised on the foundation, that such action is constitutionally impermissible. ", "67. In order to determine whether or not the appellate functions which have now been vested with the , constituted the core judicial appellate function traditionally vested with the jurisdictional , we have recorded under the heading \u2013 \u201cThe Historical Perspective\u201d, legislative details, pertaining to the Income Tax Act , the Customs Act and the Excise Act . We had to do so, for that was the only manner to deal with the instant aspect of the controversy. A perusal of the historical perspective reveals, that as against the initial assessment of tax/duty liability, the first forum for challenge has traditionally been with an executive appellate adjudicatory authority. Legislative details reveal, that for some time there was a power of reference, exercisable on \u201cquestions of law\u201d. The adjudication thereof rested with the jurisdictional . The second appellate remedy has always been before a quasi-judicial appellate authority, styled as . Across the board, under all the enactments which are relevant for the present controversy, proceedings before have been legislatively described as \u201cjudicial proceedings\u201d. It is, therefore apparent, that right from the beginning, the clear legislative understanding was, that from the stage of the proceedings before , the proceedings were of the nature of \u201cjudicial proceedings\u201d. Again across the board, under all the enactments, relevant for the present controversy, questions of law were originally left to be adjudicated by the jurisdictional . The reference jurisdiction, was substituted in all the enactments, and converted into appellate jurisdiction. The instant appellate jurisdiction was vested with the jurisdictional . Under the Income Tax Act , 1961, Section 260A , provided an appellate remedy from an order passed by , to the jurisdictional . Similarly Section 129A of the Customs Act, 1962, and Section 35G of the Central Excise Act, 1944, provided for an appellate remedy from the concerned to the . The jurisdictional would hear appeals on questions of law, against orders passed by s. It is, therefore apparent, that right from the beginning, well before the promulgation of the Constitution, the core judicial appellate functions, for adjudication of tax related disputes, were vested with the jurisdictional . The have traditionally, been exercising the jurisdiction to determine questions of law, under all the above tax legislations. In this view of the matter, it is not possible for us to conclude, that it was not justified for the learned counsel for the petitioners to contend, that the core judicial appellate function in tax matters, on questions of law, has uninterruptedly been vested with the jurisdictional . ", "68. Before we proceed with the matter further, it is necessary to keep in mind the composition of the adjudicatory authorities which have historically dealt with the matters arising out of tax laws. First, we shall deal with the composition of the . All which are relevant for the present controversy were essentially comprised of Judicial Members, besides Accountant or Technical Members. To qualify for appointment as a Judicial Member, it was essential that the incumbent had held a judicial office in India for a period of 10 years, or had practiced as an Advocate for a similar period. It is the above qualification, which enabled the enactments to provide, by a fiction of law, that all the said were discharging \u201cjudicial proceedings\u201d. The next stage of appellate determination, has been traditionally vested with . The income-tax legislation, the customs legislation, as well as, the central excise legislation uniformly provided, that in exercise of its appellate jurisdiction, the jurisdictional would adjudicate appeals arising out of orders passed by the respective . The said appeals were by a legislative determination, to be heard by benches comprising of at least two judges of the . Adjudication at the hands of a bench consisting of at least two judges, by itself is indicative of the legal complications, insofar as the appellate adjudicatory role, of the jurisdictional was concerned. It would, therefore, not be incorrect to conclude, by accepting the submissions advanced at the hands of the learned counsel for the petitioners, that before and after promulgation of the Constitution, till the enactment of the NTT Act, all legislative provisions vested the appellate power of adjudication, arising out of the Income Tax Act , the Customs Act and the Excise Act , on questions of law, with the jurisdictional s. ", "69. Having recorded the above conclusion, the next issue to be determined is whether the adjudication of the disputes arising out of the provisions under reference, must remain within the realm of the jurisdictional ? The instant proposition has two perspectives. Firstly, whether constitutional interpretation in the manner accepted the world over (details whereof have been narrated by us under the heading \u2013 \u201cThe Issues canvassed on behalf of the petitioners\u201d, under the sub-title \u2013 \u201cThe second contention\u201d), would be a constitutional mandate, for the appellate jurisdiction pertaining to tax matters, to remain with ? Secondly, whether the express provisions of the Constitution mandate, that tax issues should be decided by the concerned jurisdictional ? ", "70. We shall first deal with the first perspective, namely, whether constitutional interpretation in the manner accepted the world over, would be a constitutional mandate for appellate jurisdiction on tax matters, to remain with the jurisdictional . Insofar as the instant aspect of the matter is concerned, reliance was placed on judgments emerging out of the Constitutions of Jamaica, Ceylon, Australia and Canada, rendered either by or the highest Courts of the concerned countries. The contention of the learned counsel for the petitioners was, that the constitutions of the above countries were based on the model. It was further pointed out, that the Indian Constitution was also based on the model, and that, the instant position stands recognized in the judgment rendered by this Court in case (supra). Incidentally, it may be mentioned that we have extracted paragraph 101 of the above judgment hereinabove, wherein it is so recorded. It is accordingly the contention of the learned counsel for the petitioners, that the judgments relied upon by the petitioners on the instant aspect of the matter, would be fully applicable to the controversy in hand. Under the constitutional convention, adverted to in the judgments referred to on behalf of the petitioners, it was submitted, that judicial power which rested with definite courts at the time of enactment of the constitutions based on the model, had to remain with the same courts, even after the constitutions had become effective and operational. Furthermore, it was submitted, that the judicial power had to be exercised in the same manner as before, i.e., whether by a judge sitting singly, or with other judges. And therefore it was asserted, that on constitutional conventions well recognized the world over, appellate jurisdiction in respect of tax matters, would have to remain with the jurisdictional s, and would have to be determined by a bench of at least two judges of the , as was the position before the enactment of the Constitution, and, as has been the position thereafter, till the promulgation of the NTT Act. ", "71. We have given our thoughtful consideration to the submission advanced at the hands of the learned counsel for the petitioners, insofar as the first perspective is concerned. We find substance in the submission advanced at the hands of the learned counsel for the petitioners, but not exactly in the format suggested by the learned counsel. A closer examination of the judgments relied upon lead us to the conclusion, that in every new constitution, which makes separate provisions for the legislature, the executive and the judiciary, it is taken as acknowledged/conceded, that the basic principle of \u201cseparation of powers\u201d would apply. And that, the three wings of governance would operate in their assigned domain/province. The power of discharging judicial functions, which was exercised by members of the higher judiciary, at the time when the constitution came into force, should ordinarily remain with the court, which exercised the said jurisdiction, at the time of promulgation of the new constitution. But the judicial power could be allowed to be exercised by an analogous/similar court/tribunal, with a different name. However, by virtue of the constitutional convention, while constituting the analogous court/tribunal, it will have to be ensured, that the appointment and security of tenure of judges of that court would be the same, as of the court sought to be substituted. This was the express conclusion drawn in case (supra). In case it was acknowledged, that was not precluded from establishing a court under a new name, to exercise the jurisdiction that was being exercised by members of the higher judiciary, at the time when the constitution came into force. But when that was done, it was critical to ensure, that the persons appointed to be members of such a court/tribunal, should be appointed in the same manner, and should be entitled to the same security of tenure, as the holder of the judicial office, at the time when the constitution came into force. Even in the treatise \u201cConstitutional Law of Canada\u201d by , it was observed; if a province invested a tribunal with a jurisdiction of a kind, which ought to properly belong to a superior, district or county , then that court/tribunal (created in its place), whatever is its official name, for constitutional purposes has to, while replacing a superior, district or county , satisfy the requirements and standards of the substituted court. This would mean, that the newly constituted court/tribunal will be deemed to be invalidly constituted, till its members are appointed in the same manner, and till its members are entitled to the same conditions of service, as were available to the judges of the court sought to be substituted. In the judgments under reference it has also been concluded, that a breach of the above constitutional convention could not be excused by good intention (by which the legislative power had been exercised, to enact a given law). We are satisfied, that the aforesaid exposition of law, is in consonance with the position expressed by this , while dealing with the concepts of \u201cseparation of powers\u201d, the \u201crule of law\u201d and \u201cjudicial review\u201d. In this behalf, reference may be made to the judgments in case (supra), as also, in case (supra). Therein, this has recognized, that transfer of jurisdiction is permissible, but in effecting such transfer, the court to which the power of adjudication is transferred, must be endured with salient characteristics, which were possessed by the court from which the adjudicatory power has been transferred. In recording our conclusions on the submission advanced as the first perspective, we may only state, that our conclusion is exactly the same as was drawn by us while examining the petitioners\u2019 previous submission, namely, that it is not possible for us to accept, that under recognized constitutional conventions, judicial power vested in superior courts cannot be transferred to coordinate courts/tribunals. The answer is, that such transfer is permissible. But whenever there is such transfer, all conventions/customs/practices of the court sought to be replaced, have to be incorporated in the court/tribunal created. The newly created court/tribunal would have to be established, in consonance with the salient characteristics and standards of the court which is sought to be substituted. ", "72. Now we shall deal with the second perspective, namely, whether the provisions of the Indian Constitution itself mandate, that tax issues at the appellate level, must be heard by the concerned jurisdictional . Insofar as the instant aspect of the matter is concerned, learned counsel for the petitioners placed reliance on Articles 50 and 225 of the Constitution. Article 50 of the Constitution was relied upon to demonstrate the intent of the framers of the Constitution, namely, that they wished to ensure the exclusivity and the separation of the judiciary, from the executive. It is not necessary for us to deal with the instant aspect of the matter, for the reason that, in the judgments rendered by this which have been referred to by us hereinabove, the issue has already been debated with reference to Article 50 of the Constitution. ", "73. The other provision relied upon by the learned counsel for the petitioners is Article 225 of the Constitution. The tenor of the submission advanced by the learned counsel for the petitioners, has been recorded by us while dealing with the second contention (advanced on behalf of the petitioners). The same may be adverted to. There can be no doubt whatsoever, that Article 225 of the Constitution does expressly provide, that the jurisdiction of existing and the respective powers of the judges thereof \u201cshall be the same as immediately before the commencement of the Constitution\u201d. It is also apparent, that the proviso thereto expressly mandates, \u201cthat any restriction to which the exercise of original jurisdiction by any of the with respect to any matter concerning the revenue or concerning any act ordered or done in collection thereof was subject immediately before the commencement of the Constitution shall no longer apply to the exercise of such jurisdiction\u201d. Insofar as the contention emerging out of the proviso is concerned, it needs to be pointed out, that the same pertains to \u201cthe exercise of original jurisdiction by any of the \u201d. It is, therefore apparent, that the issue in hand, namely, the appellate jurisdiction vested with the jurisdictional , under the provisions of the Income Tax Act , the Customs Act and the Excise Act , has no bearing to the proviso under reference. We may therefore conclude by recording, that the instant submission advanced on behalf of the petitioners, is not made out from Article 225 of the Constitution. ", "IV. Whether Company Secretaries should be allowed to appear before the to represent a party to an appeal in the same fashion, and on parity with, Accountants? ", "V. Whether Section 13(1) of the Act insofar as it allows Accountants to represent a party to an appeal before the is valid? ", "74. We may first take up for consideration, Writ Petition (Civil) no. 621 of 2007. The same has been filed by members of , seeking the right to appear before the , as representatives of a party to an appeal. Respondent no. 5 in the said Writ Petition, is . It has entered appearance and canvassed that the claim of Company Secretaries and Chartered Accountants is not comparable. While indicating the permissibility of Chartered Accountants to represent a party to an appeal before the on account of their special acumen, their claim is, that this issue raised on behalf of the Company Secretaries is a matter of policy. And therefore, it would not be open to this Court to bestow, on account of parity, the right to represent a party to an appeal, before the , on Company Secretaries. ", "75. While examining the above contention, we will indeed be dealing with Section 13 of the Act, which has already been extracted while recording the submissions advanced on behalf of the petitioners, with reference to the fourth contention. A perusal of the said provision reveals, that a party to an appeal (other than the ) may appear either in person, or may authorize one or more Chartered Accountants, or legal practitioners, or any person duly authorized by him, to present his case before the . The pointed submission advanced on behalf of was, that under Section 13 of the Act, Chartered Accountants are entitled to appear before the , because of their recognized acumen. It was submitted, that it is the prerogative of the legislature and a matter of policy, to determine persons who are entitled to appear before the . It was pointed out, that courts should not ordinarily interfere in such policy matters. It is therefore, that learned counsel for , has placed reliance on the decision rendered by this Court in , , wherefrom our pointed attention was invited to the following observations:- ", "\u201c2. The propriety and validity of the public notice issued by the Director, , Delhi Administration indicating that had recognized Ayurveda Ratna and Vaid Visharada degrees awarded by the Hindi Sahitya Sammelan, , Allahabad only up to 1967 and the certificate of Ayurveda Ratna and Vaid Visharada given by the said organization after 1967 not being recognized under the said Act, registration obtained by any person as a medical practitioner on the basis of such degrees therefore would not be recognized and any person having such qualification would not be entitled to practise in Delhi are impugned in these appeals. It was also indicated in the said public notice that no Indian university or conducts one year\u2019s course for giving the bachelor\u2019s degree in Ayurvedic Medicine or through correspondence course no M.D. Degree in Ayurveda was conferred by any university or . The public at large was cautioned by the said public notice published in the newspaper about such position in law. ", "xxx xxx xxx ", "5. We are, however, unable to accept such contention of Mr. . Sub- section (3) of Section 17 of the Indian Medicine Central Council Act, 1970, in our view, only envisages that where before the enactment of the said Indian Medicine Central Council Act , 1970 on the basis of requisite qualification which was then recognized, a person got himself registered as medical practitioner in the disciplines contemplated under the said Act or in the absence of any requirement for registration such person had been practising for five years or intended to be registered and was also entitled to be registered, the right of such person to practise in the discipline concerned including the privileges of a registered medical practitioner stood protected even though such practitioner did not possess requisite qualification under the said Act of 1970. It may be indicated that such view of ours is reflected from the Objects and Reasons indicated for introducing sub-section (3) of Section 17 in the Act. In the Objects and Reasons, it was mentioned: ", "\u201c[T]he Committee are of the opinion that the existing rights and privileges of practitioners of Indian Medicine should be given adequate safeguards. The Committee, in order to achieve this object, have added three new paragraphs to sub-section (3) of the clause protecting (i) the rights to practise of those practitioners of Indian Medicine who may not, under the proposed legislation, possess a recognized qualification subject to the condition that they are already enrolled on a State Register of Indian Medicine on the date of commencement of this Act, (ii) the privileges conferred on the practitioners of Indian Medicine enrolled on a State Register, under any law in force in that State, and (iii) the right to practise in a State of those practitioners who have been practising Indian [pic]Medicine in that State for not less than five years where no register of Indian Medicine was maintained earlier.\u201d As it is not the case of any of the writ petitioners that they had acquired the degree in between 1957 (sic 1967) and 1970 or on the date of enforcement of provisions of Section 17(2) of the said Act and got themselves registered or acquired right to be registered, there is no question of getting the protection under sub-section (3) of Section 17 of the said Act. It is to be stated here that there is also no challenge as to the validity of the said Central Act , 1970. The decision of therefore cannot be assailed by the appellants. We may indicate here that it has been submitted by Mr. and also by Ms. appearing in the appeal arising out of Special Leave Petition No. 6167 of 1993 that proper consideration had not been given to the standard of education imparted by the said , Prayag and expertise acquired by the holders of the aforesaid degrees awarded by the said institution. In any event, when proper medical facilities have not been made available to a large number of poorer sections of the society, the ban imposed on the practitioners like the writ petitioners rendering useful service to the needy and poor people was wholly unjustified. It is not necessary for this Court to consider such submissions because the same remains in the realm of policy decision of other constitutional functionaries. We may also indicate here that what constitutes proper education and requisite expertise for a practitioner in Indian Medicine, must be left to the proper authority having requisite knowledge in the subject. As the decision of is justified on the face of legal position flowing from the said Central Act of 1970, we do not think that any interference by this Court is called for. These appeals therefore are dismissed without any order as to costs.\u201d Reliance was also placed on , , wherein it was held as under:- ", "\u201c4. The question which arises for determination in this case is whether the respondent had the eligibility qualification for admission in General Nursing and Midwifery and Staff Nurse Course (hereinafter referred to as \u201cNursing Course\u201d) commencing in the year 1990. The Director, Medical and Health Services had invited applications by 15-12-1989 from eligible candidates for admission in to be started from January 1990. It was stated in the notification that the candidates should have passed first year of three years\u2019 degree course (TDC) or 10+2; and that the candidates with Science subjects (Biology, Chemistry, Physics) will be given preference. During the period, had issued a set of Syllabi and Regulations for courses in General Nursing and Midwifery in which the prescribed minimum educational qualification for all candidates was 12th class-pass or its equivalent preferably with Science subjects. ", "xxx xxx xxx ", "10. The points involved in the case are twofold: one relating to prescription of minimum educational qualification for admission to the course and the other relating to recognition of the Madhyama Certificate issued by , Allahabad as equivalent to or higher than +2 or 1st year of TDC for the purpose of admission. Both these points relate to matters in the realm of policy decision to be taken by or the authority vested with power under any statute. It is not for courts to determine whether a particular educational qualification possessed by a candidate should or should not be recognized as equivalent to the prescribed qualification in the case. That is not to say that such matters are not justiciable. In an appropriate case the court can examine whether the policy decision or the administrative order dealing with the matter is based on a fair, rational and reasonable ground; whether the decision has been taken on consideration of relevant aspects of the matter; whether exercise of the power is obtained with mala fide intention; whether the decision serves the purpose of giving proper training to the candidates admitted or it is based on irrelevant and irrational considerations or intended to benefit an individual or a group of candidates.\u201d ", "76. In addition to the above submissions it was contended, that the Chartered Accountants are permitted to appear before a large number of tribunals/fora. Illustratively it was submitted, that under Section 288 of the Income Tax Act, 1961, read with Rule 50 of the Income Tax Rules, 1962, Chartered Accountants are permitted to appear in income tax matters. Likewise, it was asserted that Chartered Accountants are entitled to appear in Central Excise matters under Section 35Q of the Central Excise Act, 1944. They are also permitted to appear in matters arising out of the Customs Act , 1962 (wherefor reliance was placed on Section 146A of the Customs Act, 1962, read with Rule 9(a), Customs (Appeals) Rules, 1982). Besides the aforesaid provisions, it was contended, that Chartered Accountants were entitled to appear before various tribunals/fora under different statutory provisions, such as, under the Securities and Exchange Board of India Act , 1992, the Securities Contracts (Regulation) Act , 1956, the Telecom Regulatory Authority of India Act , 1991, the Companies Act , 2013, the Company Law Board Regulations, 1991, the Competition (Amendment) Act , 2007, and the Special Economic Zone Rules, 2006. We were informed, that Chartered Accountants were also entitled to appear before vide Notification dated 27.8.1999. It was submitted, that if Chartered Accountants are competent to canvass complicated disputes which arise under the provisions referred to hereinabove, there should be no difficulty in allowing them to appear before the , as also, to consider them eligible for being appointed as Members of the . It was therefore asserted, that Section 13 of the Act rightly permitted Chartered Accountants to represent a party to an appeal before the . The submission on behalf of was, that Company Secretaries were not comparable with them, and therefore, as a matter of policy, they had no legitimate claim for being allowed to represent a party before the . ", "77. It is pertinent to record, that during the course of hearing we had required learned counsel representing the petitioners, to file a compilation of cases, wherein provisions of different laws on diverse subjects had to be taken into consideration, while deciding tax related disputes. In compliance, learned counsel have submitted a compilation on behalf of (in Transferred Case (Civil) no. 150 of 2006), tabulating by way of illustration, reported cases on tax disputes, which also involved provisions of different laws on different subjects. The compilation brought to our notice is summarized hereunder:- I: Hindu Law: ", "|Sl.|Name and citation|Allied subject/law adjudicated upon | |No |of case | | |1 |Sri Sri Sridhar |A Hindu idol is a juristic entity that is given the | ", "| | . |status of a human being capable of having property and | | |(1967) 63 ITR 192|it can be called an \u2018individual\u2019. | | |(Cal) | | |2 |C.E.D. v. |Though a widow cannot be a coparcener, she has | | |Kuppuswamy |copercenary interests and she is also a member of the | | |(1977) 108 ITR |coparcenary by virtue of the rights conferred by the | | |439 (SC) |Hindu Women\u2019s Rights to Property Act , 1937. | |3 |Narendranath v. |There is no distinction between property obtained by a | | |C.W.T. |member of on a partition and the property that | | |(1969) 74 ITR 190|belongs to a member as a sole surviving coparcener by | | |(SC) |right of survivorship. | |4 |Goli Eswariah v. |A unilateral declaration of a Hindu coparcener, whereby| | |C.G.T. |he throws his self-acquired property into the common | | |(1970) 76 ITR 675|stock of the joint family property, does not amount to | | |(SC) |a transfer and, therefore, such an act does not | | | |constitute a gift. | |5 | Supreme Court held that the wife and daughters | | |Rani Dutta |inheriting the property of a male Hindu do not form a | | |(2001) 248 ITR | and that they could not also form such family by | | |201 (SC) |agreement among themselves by throwing their respective| | | |inherited shares in the hotchpot. | |6 | gift of property of a to the members of the | | |Prasad Anshu |family is not void but voidable. | | |Kumar | | | |(2001) 249 ITR | | | |755 (Delhi) | | |7 |C.W.T. v. M.A.R. |Even the fact that the wife had given up her right to | | |Rajkumar |maintenance does not mean that she is no longer a | | |(1997) 226 ITR |member of the family of her husband. | | |804 (AP) | | |8 | amount spent by a Hindu father on his daughter\u2019s | | |Apparao |marriage is treated as maintenance (and not a gift) | | |(2001) 248 ITR |under the Hindu Adoptions and Maintenance Act , 1956. | | |103 (AP) | | |9 |Gowli Buddanna v.|A sole surviving coparcener can constitute a Hindu | | |C.I.T. |undivided family. | | |60 ITR 293 (SC) | | |10 | separate property of the father inherited upon | | |Sen |intestacy by the son is to be treated as the son\u2019s | | |161 ITR 370(SC) |separate property and not as the property of his joint | | | |family. | |11 | on partition of the family, separate shares are | | |Shyam Agrawal |allotted to the , his wife and children, the | | |230 ITR 21 |existence of the Hindu undivided family comes to an | | |(Patna) |end, and the share of the erstwhile becomes his | | | |separate property. | |12 |Kaniram |A joint Hindu family, as such, cannot be a partner in a| | |Hazarimull v. |firm. However, it may enter into a partnership through| | |C.I.T. |its . | | |27 ITR 294 (Cal) | | |13 | female member, as a member of a joint family, can | | |Industries |become a partner in a firm as the representative of her| | |119 ITR 282 Pat) |family. | |14 |C.G.T. v. |Unequal partition amongst coparceners in a does not| | |Chettiar |amount to a gift. | | |82 ITR 599 (SC) | | |15 |Paramanand Bajaj |In the reunion of a , all assets originally | | |v. C.I.T. |partitioned need not be pooled back. | | |135 ITR 673(Kar) | | |16 |Pushpa Devi v. |The scope of the theory of blending in Hindu law was | | |C.I.T. |discussed in detail. | | |109 ITR 730(SC) | | |17 |C.I.T. v. B. |Gift deed executed by the assessee in favour of her | | |Indira Devi |daughter to secure her future after marriage was not | | |238 ITR 846 (Ker)|due to any legal obligation enjoined upon the assessee | | | |by virtue of Section 20 of the Hindu Adoptions and | | | | Maintenance Act , but for other considerations. | | | |Therefore, the gift being voluntary within the meaning | | | |of Section 2(xii) of the Gift Tax Act, 1964, was liable| | | |to tax. | |18 |Sathyaprana |Meaning of \u201ccoparcenary\u201d, \u201c\u201d and \u201csurvivorship\u201d | | |Manjunatha Gowda |discussed. | | |v. C.E.D. | | | |227 ITR 130 (SC) | | |19 | from shares held by the members of cannot be| | |Shakuntala |termed as the income of . | | |(1961) 43 ITR 352| | | |(SC) | | |20 | member marrying a Christian under Special | | |Sridharan | Marriage Act , 1956. way of living practiced by | | |104 ITR 436 (SC) |divided member and son \u2013 continue to be \u2013 meaning | | | |of word \u201cHindu\u201d discussed. | II: Company Law: ", "|Sl.|Name and citation|Allied subject/law adjudicated upon | |No |of case | | ", "|1 | private company becoming a public company by virtue | | |Publications Ltd.|of the provisions of Section 43A of the Companies Act, | | |(2001) 251 ITR |1956 may still not become a \u201ccompany in which the | | |0120 (Guj.) |public are substantially interested\u201d due to the | | | |restriction imposed on its shareholders upon | | | |transferability of its shares to the other members of | | | |the public. | |2 | that a registered shareholder holds the | | |Ltd. |share in his own right and any claim that shares were | | |(2012) 345 ITR |being held as a nominee has to be proved by the person | | |0163 (Del) |claiming so. | |3 |Rajasthan |Shares of a single type issued by a State Financial | | |Financial |Corporation providing for minimum and maximum dividend | | |Corporation v. |cannot be termed as \u2018preference shares\u2019. | | |C.I.T. | | | |163 ITR 278(Raj) | | |4 |Bacha F. Guzdar |(i) Partnership is merely an association of persons | | |v. C.I.T. |for carrying on the business of partnership and, in | | |AIR 1955 SC 74 |law, the firm name is a compendious method of | | | |describing the partners. Such is, however, not the | | | |case of a company which stands as a separate juristic | | | |entity distinct from the shareholders. | | | |(ii) Shareholders have no right in the property of the| | | |company. They are only entitled to dividends and a | | | |share in the surplus, if any, after the dissolution of | | | |the company. | |5 |Juggilal Kamlapat|Although company is a separate legal entity, in certain| | |v. C.I.T. |exceptional cases, the Court can lift the veil of the | | |AIR 1969 SC 932; |corporate entity and have regard to the economic | | | |realities behind the legal fa\u00e7ade. | | |and (Pvt.)| | | |Ltd. | | | |(1999) 236 ITR | | | |416 () | | |6 |C.G.T. v. Indo |Valuation of shares-reasonable valuation has to be | | |Traders & |accepted unless the valuation shocks conscience of the | | |Agencies (Madras)|court. | | |Ltd. | | | |131 ITR 313 (Mad)| | |7 |Vodafone |In company law, there is no transfer of a share when | | |International |there is a transfer of underlying assets. Various | | |Holdings BV v. |issues of lifting of the corporate veil discussed. | | |UoI |Also discussed, briefly, the enforceability of | | |341 ITR 1 (SC) |shareholders\u2019 agreements. | |8 | firm of 20 major partners and 3 minor partners does | | |Khan and Mahaboob|not contravene Section 11(2) of the Companies Act, 1956| | |Khan and Co. |since minors are not to be reckoned as partners for the| | |(2002) 257 ITR |purposes of the calculation. | | |0170 (AP) | | |9 |Marshall Sons and|Amalgamation \u2013 date of transfer/ date of amalgamation /| | |Co. (India) Ltd. |transfer is the date specified in the scheme as the | | |v. I.T.O. |transfer date. | | |(1997) 223 ITR | | | |809 (SC) | | |10 | . |a) On amalgamation there is an extinguishment of | | |Grace Collis and |rights and, therefore, there is a transfer. | | |others |b) The amalgamation scheme sanctioned by the court | | |248 ITR 323(SC) |would be an instrument within the meaning of Section | | | |2(1) of the Bombay Stamp Act, 1958, and liable for | | | |stamp duty. A document creating or transferring a | | | |right is an instrument. | |11 |Anarkali Sarabhai|Redemption of preference shares amounts to transfer and| | |v. C.I.T. |is liable to capital gains. | | |227 ITR 260(SC) | | |12 | arising out of slump sale of business as a going | | |Manufacturing Co.|concern is liable to tax under Section 41(2) on | | |227 ITR 260(SC) |itemized basis if slump sale is determined on valuation| | | |of each asset/ liability. | |13 |C.I.T. v. Gold |Valuation of bonus shares \u2013 The correct method to apply| | |Mohore Investment|in cases where bonus shares rank pari passu is to take | | |Company Ltd. |the cost of the original shares and to spread it over | | |(1970) 78 ITR 16 |all the original as well as the bonus shares and to | | |(SC) |find out the average price of all the shares. | |14 |Hansur Plywood |When a shareholder gets a bonus share the value of the | | |Works Ltd. v. |original share held by him goes down. In effect, the | | |C.I.T. |shareholder gets two shares instead of the one share | | |(1998) 229 ITR |held by him and the market value as well as the | | |112 (SC) |intrinsic value of the two shares put together will be | | | |the same or nearly the same as the value of the | | | |original share before the bonus issue. | |15 |Shree Gopal Paper|Issuance of share takes place when entry of name of | | |Mills Ltd. v. |subscriber or successful offerer is made in the | | |C.I.T. |Register of Members. | | |(1967) 64 ITR 233| | | |(Cal) | | |16 |Dalmia Investment|Though no cash is paid by the shareholders for | | |Co. Ltd. v. |allotment of the bonus shares, the set-off for dividend| | |C.I.T. |which was due to be paid to the shareholder out of | | |(1961) 41 ITR 705|undistributed profits of company can be regarded as | | |(Pat) |consideration for the bonus shares. Therefore, real | | | |cost of bonus shares to shareholder/assessee is the | | | |value of shares as shown in books of account of the | | | |company. | |17 |Anarkali Sarabhai|Redemption of preference shares is \u201ctransfer\u201d and | | |v. C.I.T. |liable to capital gains. | | |227 ITR 260 (SC) | | |18 | arising out of \u201cslump sale\u201d of a business as a | | |Manufacturing Co.|going concern is liable to tax under Section 41(2) on | | |227 ITR 260 (SC) |itemized basis if the slump sale is determined on | | | |valuation of each asset/liability. | III: Mohammedan Law: ", "|Sl.|Name and citation|Allied subject/law adjudicated upon | |No |of case | | |1 |Trustees of |A gift was made to the assessee by his father granting | | life estate and the remainder to his children. | ", "| |Kuslsum Trust v. |Deed was held to be void under Mohammedan law. It was | | |C.E.D. |held to be an absolute gift. | | |[1998] 233 ITR | | | |434 (SC) | | |2 |S.C.M. Mohammed |Principles of Mohammedan law regarding gift analyzed | | |v. C.I.T. |and applied \u2013 gift with limited estate not valid in | | |[1999] 235 ITR 75|Muslim law \u2013 gift to be that of an entire property | | |(Mad) |though the document only gave him a limited right. | |3 |Ghiasuddin Babu |Deferred dower on the dissolution of marriage by death | | | . |or divorce is not a contingent debt because one of the | | | 153 ITR |two events is bound to happen. Wife cannot demand the | | |707 (AP) |payment of deferred dower before the event, but husband| | | |can pay even earlier. | |4 |Ziauddin Ahmed v.|A family arrangement is valid amongst Muslims. | | |C.G.T. | | | |(1976) 102 ITR | | | |253 (Gau) | | |5 | wakf cannot be a partner, but the mutawalli of a wakf| | |Ponmanichintakam |can be. | | |Wakf, | | | |44 ITR 172 (SC) | | |6 |Ahmed G H Ariff |Held, the moment a wakf is created all rights of | | |v. C.W.T. |property pass out of wakf and vest in the Almighty \u2013 | | |76 ITR 471 (SC) |Property is a term of the widest import and subject to | | | |any limitation which the context may require; it | | | |signifies every possible interest which a person can | | | |clearly hold or enjoy. | IV: Family Arrangement: ", "|Sl.|Name and citation|Allied subject/law adjudicated upon | |No |of case | | |1 |C.I.T. v. R. |Even if a party to the settlement had no title but, | | |Ponnammal |under the family arrangement, the other party | ", "| |(1987) 164 ITR |relinquishes all its claims or titles in favour of such| | |706 (Mad) |a person and acknowledges him to be the sole owner, | | | |then the antecedent title must be assumed and the | | | |family arrangement will be upheld. | |2 | asset acquired by way of a family arrangement to be | | |Chandran |considered as an asset acquired on partition or other | | |(2000) 241 ITR |succession. | | |371 (Mad) | | V: Law of Partnership: ", "|Sl.|Name and citation|Allied subject/law adjudicated upon | |No |of case | | |1 | of partnership firm \u2013 transfer to partner by | | |Palaniappa |agreement \u2013 not valid \u2013 registered deed necessary. | | |Enterprises | | | |(1998) 234 ITR | | | |635 (Mad) | | |2 |Contribution of capital by a partner to a firm | | |Sarabhai v. |constitutes \u201ctransfer\u201d. | | |C.I.T. | | | |(2001) 250 ITR | | | |745 (Guj) | | |3 |Sunil |Conversion of an exclusive interest into a shared | | |Siddharthabhai v.|interest would amount to a \u201ctransfer\u201d and does not | | |C.I.T. |amount to a conveyance by way of sale. | | |(1985) 156 ITR | | | |509 (SC) | | |4 |C.I.T. v. S. |Transaction of a partner with the firm, during the | | |Rajamani and |subsistence of the firm requires a registered | | |Thangarajan |instrument, where the transaction involves immovable | | |Industries |property. | | |(2000) 241 ITR | | | |668 (Mad) | | ", "|5 |Malabar Fisheries|Distribution of assets on dissolution is not transfer | | |v. C.I.T. |by the firm. | | |(1979) 120 ITR 49| | | |(SC) | | |6 |C.I.T. v. |Validity of partnership \u2013 contribution of partner need | | |Brothers |not be cash or property. Skill and labor would | | |(1981) 131 ITR |constitute contribution. | | |492 (All) | | |7 |C.G.T. v. |Minors who were admitted to the benefits of the | | |Kr. Saharia |partnership could not claim their share of goodwill on | | |(1993) 204 ITR 78|the reconstruction of the firm by excluding the minors | | |(Gau) |and consequently they were not liable to gift-tax. | |8 |Beniram Moolchand|The mere fact that two persons take a commission agency| | |v. C.I.T. |business jointly would not necessarily constitute a | | |25 ITR 287 (All) |partnership between them. | |9 | a partnership has been entered between two persons | | |of whom one is a benamidar of the other, there is no | | |Kumar |relation of partnership between the two persons and one| | |203 ITR 435 |person cannot constitute a firm. | | |(Raj.) | | |10 |Addl. C.I.T. v. |On retirement of a partner from the firm, there is no | | |Mohanbhai |transfer of interest of the partner I the assets | | |Pamabhai |thereof including the goodwill. The amount received is| | |165 ITR 166 (SC) |no assessable as capital gains. This case law is valid| | | |even after amendment in Section 45(4) which talks of | | | |dissolution or otherwise transferred. | |11 |Manohardas |It is open to the partners to agree not to take the | | |Kedarnath v. |whole of the firm\u2019s profits for their personal use and | | |C.I.T. |to reserve a part of the firm\u2019s profits for charity. | | |25 ITR 287 (All) | | |12 | partner has no interest in the property of the firm. | | |Pictures (Mad) |In a case where there are two partners and one signs a | | |(1981) 129 ITR |release deed to a property in favour of the other, it | | |244 |is in fact a transfer from the partnership to that | | | |partner. | VI: Territoriality : ", "|Sl.|Name and citation|Allied subject/law adjudicated upon | |No |of case | | ", "|1 | case involved international law, municipal law and | | |Mir |a convenant between the Government of India and the | | |Bahadur |Nizam of Hyderabad. Held, that Hyderabad State never | | |(1966) 59 ITR 666|acquired an international personality under | | |(SC) |international law and its ruler was not entitled to | | | |claim immunity from taxation of his income. | |2 |Electronics |Legislative powers of to enact laws which | | |Corporation of |have provisions of having extra-territorial operation, | | |India Ltd. v. |is within the competence of . But nexus with| | |C.I.T. |something in India or object relating to India | | |183 ITR 43 (SC) |necessary. | |3 |G.V.K. Industries| is constitutionally restricted from enacting| | |Ltd. v. I.T.O. |legislation with respect to extra-territorial aspects | | |332 ITR 130 (SC) |or causes that do not have, nor are expected to have, | | | |any direct or indirect, tangible or intangible, impact | | | |on or effect in or consequences for (a) the territory | | | |of India, or any part of India; or (b) the interests | | | |of, welfare of, well-being of, or security of | | | |inhabitants of India and Indians. | |4 | connection \u2013 there must be continuity as well | | |Agarwal & Co. |as real and intimate relation between trading activity | | |56 ITR 20 |carried on outside the taxable territories and trading | | | |activity within the territories, the relation between | | | |the two contributing to the earning of income by the | | | |nonresident in his trading activity. | VII: Trusts/ Societies: ", "|Sl.|Name and citation|Allied subject/law adjudicated upon | |No |of case | | |1 |L.R. Patel Family|Trustees of a fixed (specific) trust cannot be | | | . |considered as an association of persons or body of | | |262 ITR 520 (Bom)|individuals. | ", "|2 | on the Doctrine of Cypres as applicable to | | |Trust |public charities. | | |(1982) 137 ITR | | | |735 (Mad) | | |3 | of trustees to contract on behalf of trust. | | |Swashraya |Consent of beneficiaries, if necessary. | | |286 ITR 265 (Guj)| | |4 | number of ultimate beneficiaries of a trust may | | |(1972) 83 ITR 136|increase or decrease by reason of death and other | | |(Bom) |circumstances and the interests of beneficiaries may, | | | |at a relevant date, be only contingent and may become | | | |vested at much a later date. If at that date, the | | | |beneficiaries can be ascertained, the Court must hold | | | |that the beneficiaries are determinate and known and | | | |that assets are held by the trustees for their benefit.| |5 | society registered under | | |India Hindu |Act may be treated as an association of persons. | | |Mahasabha | | | |140 ITR 748 (Del)| | |6 |Tulsidas | India Trust Act , 1882 \u2013 trustee can also be a | | |Kilachand v. |beneficiary. | | |C.I.T. | | | |42 ITR 1 (SC) | | |7 | may be created in favour of an unborn person if | | |Bhandari |it satisfies conditions laid down in Section 13 of the | | |(1984) 147 ITR | Transfer of Property Act , 1882, even though coming into| | |500 (Mad) |existence of such a beneficiary is uncertain. A trust | | | |deed cannot be bad for uncertainty or vagueness. | VIII: Contract Law : ", "|Sl.|Name and citation|Allied subject/law adjudicated upon | |No |of case | | |1 |C.I.T. v. |Nature of breach \u2013 whether payment of damage results in| | |Shantilal Pvt. |settlement of the original contract. | | |Ltd. | | | |(1983) 144 ITR 57| | | |(SC) | | |2 | received on termination of agency and | | |Co. P. Ltd. |restrictive convenant \u2013 nature of receipt \u2013 revenue or | | |60 ITR 11 (SC) |capital \u2013 restrictive convenant \u2013 whether an | | | |independent obligation \u2013 whether compensation | | | |severable. | |3 |N. Sundareswaran |Breach of contract \u2013 arbitration clause \u2013 scope of | | |v. C.I.T. | Section 73 \u2013 liquidated and unliquidated damages \u2013 no | | |(1997) 226 ITR |deduction can be claimed on potential liability for | | |142 (Ker) |damages. | IX: Transfer of Property Act : |Sl.|Name and citation|Allied subject/law adjudicated upon | |No |of case | | |1 |Bansidhar |Difference between a sale with a condition to | | |Sewabhogowan & |re-purchase and a mortgage by conditional sale. | | | . | | | |(1996) 222 ITR 16| | | |(Gau) | | ", "|2 |Jagadishchandran |Whether self-created mortgage or mortgage by previous | | |v. C.I.T. |owner affects the cost of acquisition. | | |227 ITR 240 (SC) | | | |Arunachalam v. | | | |C.I.T. | | | |227 ITR 222(SC) | | |3 | . |Though a transfer cannot be made directly to an unborn | | |Kapil Mohan |person, since under the definition of \u201ctransfer\u201d in | | |252 ITR 830 (Del)| Section 5 of the Transfer of Property Act, 1882, a | | | |transfer is limited to living persons, transfer to an | | | |unborn person can only be made by the machinery of | | | |trusts. | |4 | two registered documents re-executed by the same | | |Lata Sett |person in respect of the same property to two different| | |(1991) 190 ITR |persons at different times, the one which was executed | | |556 (Cal) |first has priority over the other, although the former | | | |was registered subsequent to the latter. In other | | | |words, registration of a document relates to the date | | | |of its execution. | |5 | a sale along with deed for re-conveyance of | | |Bhusanraj |property amounts to transfer under both common law and | | |(2002) 256 ITR |income-tax law? | | |0340 (Mad) | | X: Intellectual Property : ", "|Sl.|Name and citation|Allied subject/law adjudicated upon | |No |of case | | |1 |Anantram v. |The assignment of a patent is a transaction on capital | | |C.I.T. |account, but where a person carries on a trade in the | ", "| |5 ITR 511 (Lah) |buying and selling of patents or habitually sells his | | | |own patents, or carries on the vocation of an inventor,| | | |the sale proceeds would be business income. | |2 |Mysore Elect. V. |If the owner gets a lump sum or periodic payment for | | |C.I.T. |imparting the know-how to others, without substantially| | |114 ITR 865 (Kar)|reducing its value to himself, the payment would | | | |ordinarily be taxable as business income and the ground| | | |that the exploitation of the know-how is in the course | | | |of business and the imparting is no more than a | | | |business service of however special kind. | |3 | paid by a licensee for the right to take away| | |5 ITC 42 |earth to be used for brick making or extracting | | | |saltpeter are income. The fact that removal of the | | | |soil itself is involved does not make the case any | | | |different from cases of royalties on underground coal | | | |and quarries | XI : Interpretation : ", "|Sl.|Name and citation|Allied subject/law adjudicated upon | |No |of case | | |1 |Prakash Nath |The ruled that interpretation should avoid \u201cthe | | | . |danger of a prior determination of the meaning with | | |(2004) 266 ITR 1 |one\u2019s own preconceived notions\u201d and that the court | | |() |interprets the law and cannot legislate. It referred | | | |to two other principles of construction, one relating | | | |to casus omissus and the other requiring a statute to | | | |be read as a whole. | |2 |I.T.A.T. vs. V.K.|Contempt of court \u2013 law applicable to ITAT. | | |Agarwal | | | |235 ITR 175() | | |3 |C.I.T. v. |Spes Successionis \u2013 Transfer of Property Act dealt | | |Bhogilal Mangilal|with. | | |69 ITR 288 (Guj) | | ", "|4 |Ellerman Lines |Discusses the binding nature of CBDT\u2019s instructions on | | |Ltd. v. C.I.T. |the revenue department. | | |(1971) 82 ITR 913| | | |(SC) | | | |C.I.T. v. K.P. | | | |Varghese | | | |(1981) 131 ITR | | | |597 (SC) | | XII :Miscellaneous: ", "|Sl.|Name and citation|Allied subject/law adjudicated upon | |No |of case | | ", "|1 |Sree Meenakshi |Benami \u2013 meaning and effect of taxation in benamidars | | | . |hands discussed. | | |31 ITR 25 (SC) | | |2 |Leo Machado v. |Boat belonging to the assessee met with an accident and| | |C.I.T. |sank in high seas; the compensation received from | | |172 ITR 744 (Mad)|insurance company was due to destruction of property, | | | |thus no \u201ctransfer\u201d as contemplated by Section 45 read | | | |with Section 48 . The insurance amount received cannot | | | |be considered as consideration and amount received not | | | |liable to capital gains tax. | |3 |Gangadhar Bera v.|A clarificatory notice is a mere addendum to the | | |Asst. C.I.T. |original notice and the effect of clarification is | | |(2004) 190 ITR |always retrospective so it must relate to the original | | |467 (Cal) |notice. A mere non-mention of specific clause does not| | | |render notice bad in law. | |4 | expression \u201ccharitable purpose\u201d is very wide in its| | |Chamber of |amplitude. The object need not benefit the whole | | |Commerce |mankind or even all persons living in a particular | | |55 ITR 722 (SC) |country or province. It is sufficient if the intention| | | |is to benefit a section of the public as distinguished | | | |from the specified individuals. | |5 |Deccan Wine & |Explained the difference between \u2018association of | | |General Stores v.|persons\u2019 and \u2018body of individuals\u2019. | | |C.I.T. | | | |(1977) 106 ITR | | | |111 (AP) | | |6 |C.I.T. v. |What constitutes an agricultural activity? | | |Maharashtra Sugar|There must be cultivation of land in the strict sense | | |Mills Ltd. |of the term meaning thereby tilling the land. | | |(1971) 82 ITR 452| | | |(Bom) | | |7 | has inherent power to | | |Mohammed Kunhi |grant stay of collection taxes and proceedings. | | |(1968) 71 ITR 815| | | |(SC) | | |8 | of persons \u2013 when persons do not combine | | |Balakrishna |together to produce income, they cannot be assessed as | | |(1960) 39 ITR 546|an AOP. | | |(SC) |Note \u2013 The law has been amended after 1.4.2002 | |9 | effects of a ruler (heirloom jewellery) is not| | |Maharani Usha |taxable upon its sale for a profit. | | |Devi | | | |231 ITR 793 (MP) | | |10 | an person re-values his capital asset and credits | | |Shrinbhai Kooka |his capital account there is no gain for the purpose of| | |46 ITR 86 (SC) |taxation. One cannot make loss or profit out of | | | |transactions with himself. | |11 |Dhakeswari Cotton|Principles of Natural Justice set out almost for the | | | . |first time \u2013 locus classicus. | | |(1954) 26 ITR 775| | |12 |Chemsford Club v.|Principle of mutuality applies to income from property.| | |C.I.T. | | | |243 ITR 89 ( . | | | |226 ITR 97 (SC) | | It is apparent from the compilation extracted hereinabove, that the Members of the would most definitely be confronted with the legal issues emerging out of Family Law, Hindu Law, Mohammedan Law, Company Law, Law of Partnership, Law related to Territoriality, Law related to Trusts and Societies, Contract Law, Law relating to Transfer of Property, Law relating to Intellectual Property, Interpretation of Statutes, and other Miscellaneous Provisions of Law, from time to time. The besides the aforesaid statutes, will not only have to interpret the provisions of the three statutes, out of which appeals will be heard by it, but will also have to examine a challenge to the vires of statutory amendments made in the said provisions, from time to time. They will also have to determine in some cases, whether the provisions relied upon had a prospective or retrospective applicability. ", "78. Keeping in mind the fact, that in terms of Section 15 of the Act, the would hear appeals from and () only on \u201csubstantial questions of law\u201d, it is difficult for us to appreciate the propriety of representation, on behalf of a party to an appeal, through either Chartered Accountants or Company Secretaries, before the . The determination at the hands of the is shorn of factual disputes. It has to decide only \u201csubstantial questions of law\u201d. In our understanding, Chartered Accountants and Company Secretaries would at best be specialists in understanding and explaining issues pertaining to accounts. These issues would, fall purely within the realm of facts. We find it difficult to accept the prayer made by the Company Secretaries to allow them, to represent a party to an appeal before the . Even insofar as the Chartered Accountants are concerned, we are constrained to hold that allowing them to appear on behalf of a party before the , would be unacceptable in law. We accordingly reject the claim of Company Secretaries, to represent a party before the . Accordingly the prayer made by Company Secretaries in Writ Petition (Civil) no. 621 of 2007 is hereby declined. While recording the above conclusion, we simultaneously hold Section 13(1) , insofar as it allows Chartered Accountants to represent a party to an appeal before the , as unconstitutional and unsustainable in law. ", "VI. The constitutional validity of Sections 5, 6, 7, 8 and 13 of the NTT Act: ", "79. We shall now endeavour to deal with the validity of some other individual provisions of the NTT Act, based on the parameters laid down by constitutional benches of this Court and on the basis of recognized constitutional conventions referable to constitutions framed on the model. While dealing with the prayers made in Writ Petition (Civil) no. 621 of 2007, we have already dealt with Section 13 of the NTT Act, and have held, the same to be partly unconstitutional. We shall now proceed chronologically, and examine the validity of Sections 5, 6, 7 and 8 of the NTT Act. ", "80. We shall first examine the validity of Section 5 of the Act. The basis of challenge to the above provision, has already been narrated by us while dealing with the submissions advanced on behalf of the petitioners, with reference to the fourth contention. According to the learned counsel for the petitioners, Section 5(2) of the Act mandates, that the would ordinarily have its sittings in the National Capital Territory of Delhi. According to the petitioners, the aforesaid mandate would deprive the litigating assessee, the convenience of approaching the jurisdictional in the State, to which he belongs. An assessee may belong to a distant/remote State, in which eventuality, he would not merely have to suffer the hardship of traveling a long distance, but such travel would also entail uncalled for financial expense. Likewise, a litigant assessee from a far-flung State may find it extremely difficult and inconvenient to identify an Advocate who would represent him before the , since the same is mandated to be ordinarily located in the National Capital Territory of Delhi. Even though we have expressed the view, that it is open to the to substitute the appellate jurisdiction vested in the jurisdictional s and constitute courts/tribunals to exercise the said jurisdiction, we are of the view, that while vesting jurisdiction in an alternative court/tribunal, it is imperative for the legislature to ensure, that redress should be available, with the same convenience and expediency, as it was prior to the introduction of the newly created court/tribunal. Thus viewed, the mandate incorporated in Section 5(2) of the Act to the effect that the sittings of the would ordinarily be conducted in the National Capital Territory of Delhi, would render the remedy inefficacious, and thus unacceptable in law. The instant aspect of the matter was considered by this Court with reference to the Administrative Tribunals Act , 1985, in case (supra) and case (supra), wherein it was held, that permanent benches needed to be established at the seat of every jurisdictional . And if that was not possible, at least a circuit bench required to be established at every place where an aggrieved party could avail of his remedy. The position on the above issue, is no different in the present controversy. For the above reason, Section 5(2) of the Act is in clear breach of the law declared by this Court. ", "81. One needs to also examine sub-sections (2), (3), (4) and (5) of Section 5 of the Act, with pointed reference to the role of in determining the sitting of benches of the . has been authorized to notify the area in relation to which each bench would exercise jurisdiction, to determine the constitution of the benches, and finally, to exercise the power of transfer of Members of one bench to another bench. One cannot lose sight of the fact, that will be a stakeholder in each and every appeal/case, which would be filed before the . It cannot, therefore, be appropriate to allow to play any role, with reference to the places where the benches would be set up, the areas over which the benches would exercise jurisdiction, the composition and the constitution of the benches, as also, the transfer of the Members from one bench to another. It would be inappropriate for , to have any administrative dealings with the or its Members. In the jurisdictional , such power is exercised exclusively by the Chief Justice, in the best interest of the administration of justice. Allowing to participate in the aforestated administrative functioning of the , in our view, would impinge upon the independence and fairness of the Members of the . For the Act to be valid, the Chairperson and Members of the should be possessed of the same independence and security, as the judges of the jurisdictional (which the is mandated to substitute). Vesting of the power of determining the jurisdiction, and the postings of different Members, with , in our considered view, would undermine the independence and fairness of the Chairperson and the Members of the , as they would always be worried to preserve their jurisdiction based on their preferences/inclinations in terms of work, and conveniences in terms of place of posting. An unsuitable/disadvantageous Chairperson or Member could be easily moved to an insignificant jurisdiction, or to an inconvenient posting. This could be done to chastise him, to accept a position he would not voluntarily accede to. We are, therefore of the considered view, that Section 5 of the Act is not sustainable in law, as it does not ensure that the alternative adjudicatory authority, is totally insulated from all forms of interference, pressure or influence from co-ordinate branches of Government. There is therefore no alternative, but to hold that sub-sections (2), (3), (4) and (5) of Section 5 of the Act are unconstitutional. ", "82. We shall now examine the validity of Section 6 of the Act. The above provision has already been extracted in an earlier part of this judgment, while dealing with the submissions advanced on behalf of the petitioners, with reference to the fourth contention. A perusal of Section 6 reveals, that a person would be qualified for appointment as a Member, if he is or has been a Member of or of for at least 5 years. While dealing with the historical perspective, with reference to the Income Tax legislation, the legislation, as also, the Central Excise legislation, we have noticed the eligibility of those who can be appointed as Members of the Appellate Tribunals constituted under the aforesaid legislations. Under the Income Tax Act , a person who has practiced in accountancy as a Chartered Accountant (under the Chartered Accountants Act , 1949) for a period of 10 years, or has been a Registered Accountant (or partly a Registered Accountant, and partly a Chartered Accountant) for a period of 10 years, is eligible to be appointed as an Accountant Member. Under the Act and the Excise Act , a person who has been a member of the Indian and (Group A), subject to the condition, that such person has held the post of Collector of or Central Excise (Level I), or equivalent or higher post, for at least 3 years, is eligible to be appointed as a Technical Member. It is apparent from the narration recorded hereinabove, that persons with the above qualifications, who were appointed as Accountant Members or Technical Members in the respective Appellate Tribunals, are also eligible for appointment as Members of the , subject to their having rendered specified years\u2019 service as such. The question to be determined is, whether persons with the aforesaid qualifications, satisfy the parameters of law declared by this , to be appointed as, Members of the ? And do they satisfy the recognized constitutional conventions? ", "83. This Court has declared the position in this behalf in case (supra) and in case (supra), that Technical Members could be appointed to the tribunals, where technical expertise is essential for disposal of matters, and not otherwise. It has also been held, that where the adjudicatory process transferred to a tribunal does not involve any specialized skill, knowledge or expertise, a provision for appointment of non-Judicial Members (in addition to, or in substitution of Judicial Members), would constitute a clear case of delusion and encroachment upon the \u201cindependence of judiciary\u201d, and the \u201crule of law\u201d. It is difficult to appreciate how Accountant Members and Technical Members would handle complicated questions of law relating to tax matters, and also questions of law on a variety of subjects (unconnected to tax), in exercise of the jurisdiction vested with the . That in our view would be a tall order. An arduous and intimidating asking. Since the Chairperson/Members of the will be required to determine \u201csubstantial questions of law\u201d, arising out of decisions of the Appellate Tribunals, it is difficult to appreciate how an individual, well-versed only in accounts, would be able to discharge such functions. Likewise, it is also difficult for us to understand how Technical Members, who may not even possess the qualification of law, or may have no experience at all in the practice of law, would be able to deal with \u201csubstantial questions of law\u201d, for which alone, the has been constituted. ", "84. We have already noticed hereinabove, from data placed on record by the learned counsel for the petitioners, that the would be confronted with disputes arising out of Family Law, Hindu Law, Mohemmedan Law, Company Law, Law of Partnership, Law relating to Territoriality, Law relating to Trusts and Societies, Contract Law, Law relating to Transfer of Property, Law relating to Intellectual Property, Interpretation of Statutes/Rules, and other Miscellaneous Provisions of Law. Besides the above, the Members of the will regularly have to interpret the provisions of the Income Tax Act , the Customs Act and the Excise Act . We are of the considered opinion, that only a person possessing professional qualification in law, with substantial experience in the practice of law, will be in a position to handle the onerous responsibilities which a Chairperson and Members of the will have to shoulder. ", "85. There seems to be no doubt, whatsoever, that the Members of a court/tribunal to which adjudicatory functions are transferred, must be manned by judges/members whose stature and qualifications are commensurate to the court from which the adjudicatory process has been transferred. This position is recognized the world over. Constitutional conventions in respect of Jamaica, Ceylon, Australia and Canada, on this aspect of the matter have been delineated above. The opinion of expressed by Lord in case (supra), has been shown as being followed in countries which have constitutions on the model. The Indian Constitution is one such Constitution. The position has been clearly recorded while interpreting constitutions framed on the above model, namely, that even though the legislature can transfer judicial power from a traditional court, to an analogous court/tribunal with a different name, the court/tribunal to which such power is transferred, should be possessed of the same salient characteristics, standards and parameters, as the court the power whereof was being transferred. It is not possible for us to accept, that Accountant Members and Technical Members have the stature and qualification possessed by judges of High Courts. ", "86. It was not disputed, that the has been created to handle matters which were earlier within the appellate purview of the jurisdictional . We are accordingly satisfied, that the appointment of Accountant Members and Technical Members of the Appellate Tribunals to the , would be in clear violation of the constitutional conventions recognized by courts, the world over. References on questions of law (under the three legislative enactments in question), were by a legislative mandate, required to be adjudicated by a bench of at least two judges of the jurisdictional . When the remedy of reference (before the ) was converted into an appellate remedy (under the three legislative enactments in question), again by a legislative mandate, the appeal was to be heard by a bench of at least two judges, of the jurisdictional . One cannot lose sight of the fact, that hitherto before, the issues which will vest in the jurisdiction of the , were being decided by a bench of at least two judges of the . The onerous and complicated nature of the adjudicatory process is clear. We may also simultaneously notice, that the power of \u201cjudicial review\u201d vested in the under Articles 226 and 227 of the Constitution has not been expressly taken away by the Act. During the course of hearing, we had expressed our opinion in respect of the power of \u201cjudicial review\u201d vested in the under Articles 226 and 227 of the Constitution. In our view, the power stood denuded, on account of the fact that, Section 24 of the Act vested with an aggrieved party, a remedy of appeal against an order passed by the , directly to . Section 24 aforementioned is being extracted hereunder: ", "\u201c24. Appeal to Supreme Court.- Any person including any department of the Government aggrieved by any decision or order of may file an appeal to within sixty days from the date of communication of the decision or order of to him: ", "Provided that may, if it is satisfied that the appellant was prevented by sufficient cause from filing the appeal within the said period, allow it to be filed within such time as it may deem fit.\u201d In view of the aforestated appellate remedy, from an order passed by the directly to , there would hardly be any occasion, to raise a challenge on a tax matter, arising out of the provisions of the Income Tax Act , the Customs Act and the Excise Act , before a jurisdictional . Even though the learned Attorney General pointed out, that the power of \u201cjudicial review\u201d under Articles 226 and 227 of the Constitution had not been taken away, yet he acknowledged, that there would be implicit limitations where such power would be exercisable. Therefore, all the more, the composition of the would have to be on the same parameters as judges of the s. Since the appointments of the Chairperson/Members of the are not on the parameters expressed hereinabove, the same are unsustainable under the declared law. A perusal of Section 6 of the Act leaves no room for any doubt, that none of the above parameters is satisfied insofar as the appointment of Chairperson and other Members of the is concerned. In the above view of the matter, Section 6(2)(b) of the Act is liable to be declared unconstitutional. We declare it to be so. ", "87. We would now deal with the submissions advanced by the learned counsel for the petitioners in respect of Section 7 of the Act. It seems to us, that Section 7 has been styled in terms of the decision rendered by this in case (supra). Following the above judgment for determining the manner of selection of the Chairperson and Members of the , is obviously a clear misunderstanding of the legal position declared by this . It should not have been forgotten, that under the provisions of the Administrative Tribunals Act , 1985, which came up for consideration in case (supra), the tribunals constituted under the said Act, are to act like courts of first instance. All decisions of the tribunal are amenable to challenge under Articles 226/227 of the Constitution before, a division bench of the jurisdictional High . In such circumstances it is apparent, that tribunals under the Administrative Tribunals Act , 1985, were subservient to the jurisdictional High s. The manner of selection, as suggested in case (supra) cannot therefore be adopted for a tribunal of the nature as the . Herein the acknowledged position is, that the has been constituted as a replacement of High s. The is, therefore, in the real sense a tribunal substituting the High s. The manner of appointment of Chairperson/Members to the will have to be, by the same procedure (or by a similar procedure), to that which is prevalent for appointment of judges of High s. Insofar as the instant aspect of the matter is concerned, the above proposition was declared by this in case (supra), wherein it was held, that the stature of the Members who would constitute the tribunal, would depend on the jurisdiction which was being transferred to the tribunal. Accordingly, if the jurisdiction of the High s is being transferred to the , the stature of the Members of the tribunal had to be akin to that of the judges of High s. So also the conditions of service of its Chairperson/Members. And the manner of their appointment and removal, including transfers. Including, the tenure of their appointments. ", "88. Section 7 cannot even otherwise, be considered to be constitutionally valid, since it includes in the process of selection and appointment of the Chairperson and Members of the , Secretaries of Departments of . In this behalf, it would also be pertinent to mention, that the interests of would be represented on one side, in every litigation before the . It is not possible to accept a party to a litigation, can participate in the selection process, whereby the Chairperson and Members of the adjudicatory body are selected. This would also be violative of the recognized constitutional convention recorded by Lord in case (supra), namely, that it would make a mockery of the constitution, if the legislature could transfer the jurisdiction previously exercisable by holders of judicial offices, to holders of a new court/tribunal (to which some different name was attached) and to provide that persons holding the new judicial offices, should not be appointed in the manner and on the terms prescribed for appointment of Members of the judicature. For all the reasons recorded hereinabove, we hereby declare Section 7 of the Act, as unconstitutional. ", "89. Insofar as the validity of Section 8 of the Act is concerned, it clearly emerges from a perusal thereof, that a Chairperson/Member is appointed to the , in the first instance, for a duration of 5 years. Such Chairperson/Member is eligible for reappointment, for a further period of 5 years. We have no hesitation to accept the submissions advanced at the hands of the learned counsel for the petitioners, that a provision for reappointment would itself have the effect of undermining the independence of the Chairperson/Members of the . Every Chairperson/Member appointed to the , would be constrained to decide matters, in a manner that would ensure his reappointment in terms of Section 8 of the Act. His decisions may or may not be based on his independent understanding. We are satisfied, that the above provision would undermine the independence and fairness of the Chairperson and Members of the . Since the has been vested with jurisdiction which earlier lay with , in all matters of appointment, and extension of tenure, must be shielded from executive involvement. The reasons for our instant conclusions are exactly the same as have been expressed by us while dealing with Section 5 of the Act. We therefore hold, that Section 8 of the Act is unconstitutional. ", "90. Sections 5, 6, 7, 8 and 13 of the NTT Act have been held by us (to the extent indicated hereinabove) to be illegal and unconstitutional on the basis of the parameters laid down by decisions of constitutional benches of this Court and on the basis of recognized constitutional conventions referable to constitutions framed on the model. In the absence of the aforesaid provisions which have been held to be unconstitutional, the remaining provisions have been rendered otiose and worthless, and as such, the provisions of the NTT Act, as a whole, are hereby set aside. ", "Conclusions: ", "91 (i) The has the power to enact legislation, and to vest adjudicatory functions, earlier vested in , with an alternative court/tribunal. Exercise of such power by the would not per se violate the \u201cbasic structure\u201d of the Constitution. ", "(ii) Recognized constitutional conventions pertaining to the model, do not debar the legislating authority from enacting legislation to vest adjudicatory functions, earlier vested in a superior court, with an alternative court/tribunal. Exercise of such power by the would per se not violate any constitutional convention. ", "(iii) The \u201cbasic structure\u201d of the Constitution will stand violated, if while enacting legislation pertaining to transfer of judicial power, does not ensure, that the newly created court/tribunal, conforms with the salient characteristics and standards, of the court sought to be substituted. ", "(iv) Constitutional conventions, pertaining to constitutions styled on the model, will also stand breached, if while enacting legislation, pertaining to transfer of judicial power, conventions and salient characteristics of the court sought to be replaced, are not incorporated in the court/tribunal sought to be created. ", "(v) The prayer made in Writ Petition (C) No.621 of 2007 is declined. Company Secretaries are held ineligible, for representing a party to an appeal before the . ", "(vi) Examined on the touchstone of conclusions (iii) and (iv) above, Sections 5, 6, 7, 8 and 13 of the NTT Act (to the extent indicated hereinabove), are held to be unconstitutional. Since the aforesaid provisions, constitute the edifice of the NTT Act, and without these provisions the remaining provisions are rendered ineffective and inconsequential, the entire enactment is declared unconstitutional. ", "\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026...CJI. ", "(R.M. LODHA) \u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026.......J. ", "(JAGDISH SINGH KHEHAR) \u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026.......J. ", "(J. CHELAMESWAR) \u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026.......J. ", "() Note: The emphases supplied in all the quotations in the instant judgment, are ours. ", "New Delhi, September 25, 2014. ", "REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL ORIGINAL JURISDICTION TRANSFERRED CASE (CIVIL) No. 150 of 2006 Madras Bar Association \u2026\u2026Petitioner Versus Union of India & Anr. \u2026..Respondents WITH CIVIL APPEAL NO. 3850 OF 2006 CIVIL APPEAL NO. 3862 OF 2006 CIVIL APPEAL NO. 3881 OF 2006 CIVIL APPEAL NO. 3882 OF 2006 CIVIL APPEAL No. 4051 OF 2006 CIVIL APPEAL NO. 4052 OF 2006 WRIT PETITION (C) NO.621 OF 2007 TRANSFERRED CASE(C) NO.116 OF 2006 TRANSFERRED CASE (C) NO. 117 OF 2006 TRANSFERRED CASE (C) NO.118 OF 2006 WRIT PETITION (C) NO. 697 OF 2007 J U D G M E N T R.F.NARIMAN, J. (concurring in the result) ", "1. In these cases, essentially four contentions have been urged on behalf of the petitioners. The first contention is that the reason for setting up is non-existent as uniformity of decisions pertaining to tax laws is hardly a reason for interposing another tribunal between an appellate and , as decisions are more or less uniform, since they follow the law laid down by each other. Since this is so, the Act must be struck down. The second contention is that it is impermissible for the legislature to divest superior courts of record from the core judicial function of deciding substantial questions of law. The third contention is as regards the Constitutional validity of Article 323-B being violative of the separation of powers doctrine, the rule of law doctrine and judicial review. The fourth contention concerns itself with the nitty gritty of the Act, namely, that various sections undermine the independence of the adjudicatory process and cannot stand judicial scrutiny in their present form. Since I am accepting the second contention urged by the petitioners, this judgment will not deal with any of the other contentions. ", "2. \u201cIt is emphatically the province and duty of the judicial department to say what the law is. Those who apply the rule to particular cases, must of necessity expound and interpret that rule.\u201d What was said over 200 years ago by Chief Justice in the celebrated case of v. , holds true even today in every great republican system of Government. ", "These words take their colour from famous federalist Paper No.78 which ran thus: ", "\u201cWhoever attentively considers the different departments of power must perceive, that, in a government in which they are separated from each other, the judiciary, from the nature of its functions, will always be the least dangerous to the political rights of the Constitution; because it will be least in a capacity to annoy or injure them. The not only dispenses the honors, but holds the sword of the community. The legislature not only commands the purse, but prescribes the rules by which the duties and rights of every citizen are to be regulated. The judiciary, on the contrary, has no influence over either the sword or the purse; no direction either of the strength or of the wealth of the society; and can take no active resolution whatever. It may truly be said to have neither FORCE nor WILL, but merely judgment; and must ultimately depend upon the aid of the executive arm even for the efficacy of its judgments. ", "This simple view of the matter suggests several important consequences. It proves incontestably, that the judiciary is beyond comparison the weakest of the three departments of power, that it can never attack with success either of the other two; and that all possible care is requisite to enable it to defend itself against their attacks. It equally proves, that though individual oppression may now and then proceed from the courts of justice, the general liberty of the people can never be endangered from that quarter, I mean so long as the judiciary remains truly distinct from both the legislature and the . For I agree, that \u201cthere is no liberty, if the power of judging be not separated from the legislative and executive powers. And it proves, in the last place, that as liberty can have nothing to fear from the judiciary alone, but would have everything to fear from its union with either of the other departments; that as all the effects of such a union must ensue from a dependence of the former on the latter, notwithstanding a nominal and apparent separation; that as, from the natural feebleness of the judiciary, it is in continual jeopardy of being overpowered, awed, or influenced by its co-ordinate branches; and that as nothing can contribute so much to its firmness and independence as permanency in office, this quality may therefore be justly regarded as an indispensable ingredient in its constitution, and, in a great measure, as the citadel of the public justice and the public security.\u201d (Emphasis supplied) ", "3. The precise question arising in these appeals concerns the constitutional validity of the National Tax Tribunals Act , 2005. The question raised on behalf of the petitioners is one of great public importance and has, therefore, been placed before . Following upon the heels of the judgment in , , these matters were delinked and ordered to be heard separately vide judgment and order dated 11th May 2010 reported in . The precise question formulated on behalf of the petitioners is whether a tribunal can substitute in its appellate jurisdiction, when it comes to deciding substantial questions of law. ", "4. Sections 15 and 24 of National Tax Tribunal Act state: \u201c15. (1) An appeal shall lie to from every order passed in appeal by and , if is satisfied that the case involves a substantial question of law. (2) The Chief Commissioner or the Commissioner of Income-tax or the Chief Commissioner or Commissioner of , as the case may be, or an assessee aggrived by any order passed by or any person aggrieved by any order passed by (hereinafter referred to as aggrieved person), may file an appeal to and such appeal under this sub-section shall- ", "(a) be filed within one hundred and twenty days from the date on which the order appealed against is received by the assesee or the aggrieved person or the Chief Commissioner or Commissioner, as the case may be; ", "(b) be in the form of a memorandum of appeal precisely stating therein the substantial question of law involved; and ", "(c) be accompanied by such fees as may be prescribed: ", "Provided that separate form of memorandum of appeal shall be filed for matters involving direct and indirect taxes: ", "Provided further that may entertain the appeal within sixty days after the expiry of the said period of one hundred and twenty days, if it is satisfied that the appellant was prevented by sufficient cause from preferring an appeal in time. ", "(3) Where an appeal is admitted under sub-section (1), ", "(a) shall formulate the question of law for hearing the appeal; and ", "(b) may also determine any relevant issue in connection with the question so formulated- ", "(i) which has not been so determined by or by or ", "(ii) which has been wrongly determined by or by , and shall decide the question of law so formulated and the other relevant issue so determined and deliver such judgment thereon containing the grounds on which such decision is founded and may award such cost as it deems fit. (4) Where in any appeal under this section, the decision of or involves the payment of any tax or duties, the assessee or the aggrieved person, as the case may be, shall not be allowed to prefer such appeal unless he deposits at least twenty-five per cent of such tax or duty payable on the basis of the order appealed against: ", "Provided that where in a particular case is of the opinion that the deposit of tax or duty under this sub-section would case undue hardship to such person, it may dispense with such deposit subject to such conditions as it may deem fit to impose so as to safeguard the interest of revenue. ", "24. Appeal to Any person including any department of the Government aggrieved by any decision or order of may file an appeal to within sixty days from the date of communication of the decision or order of to him; ", "Provided that may, if it is satisfied that the appellant was prevented by sufficient cause from filing the appeal within the said period, allow it to be filed within such time as it may deem fit.\u201d ", "5. According to the petitioners, deciding substantial questions of law, even if they arise from specialized subject matters, would be a core function of the superior courts of India, and cannot be usurped by any other forum. To test the validity of this argument, we need to go to some constitutional fundamentals. ", "6. It has been recognized that unlike the U.S. Constitution, the Constitution of India does not have a rigid separation of powers. Despite that, the Constitution contains several separate chapters devoted to each of the three branches of Government. Chapter IV of part V deals exclusively with the judiciary and Chapter V of part VI deals with in the States. ", "7. Article 50 of the Constitution states: ", "\u201c50. Separation of judiciary from executive: The shall take steps to separate the judiciary from the executive in the public services of the .\u201d ", "8. Art.129 states that shall be a court of record and shall have all the powers of such a court including the power to punish for contempt of itself. Art.131 vests with original jurisdiction in disputes arising between and the States. Art. 132 to 134A vest an appellate jurisdiction in civil and criminal cases from . Art. 136 vests with an extraordinary discretionary jurisdiction to grant special leave to appeal from any judgment, decree, determination, sentence or order in any cause or matter passed or made by any court or tribunal in the territory of India. Under Art. 137 , is given power to review any judgment or order made by it. By Article 141 , the law declared by shall be binding on all courts within the territory of India. And by virtue of Art. 145(3) substantial questions as to the interpretation of the Constitution of India are vested exclusively in a bench of at least 5 Hon\u2019ble Judges. ", "9. Similarly, under Art. 214 for each State are established and under Art. 215 like , shall be courts of record and shall have all the powers of such courts including the power to punish for contempt. Under Art. 225 , the jurisdiction of, and the law administered in any existing , is preserved. Art. 226 vests with power to issue various writs for the protection of fundamental rights and for any other purpose to any person or authority. Under Art. 228 questions involving interpretation of the constitution are to be decided by alone when a court subordinate to it is seized of such question. Further, the importance of these provisions is further highlighted by Art. 368 proviso which allows an amendment of all the aforesaid Articles only if such amendment is also ratified by the legislatures of not less than one half of the States. ", "10. The Code of Civil Procedure also contains provisions which vest with the power to decide certain questions of law under Section 113 and, when they relate to jurisdictional errors, Section 115 . ", "11. Art. 227 is of ancient vintage. It has its origins in Section 107 of the Government of India Act 1915 which reads as follows: \u201cEach of has superintendence over all courts for the time being subject to its appellate jurisdiction, and may do any of the following things, that is to say.- ", "Call for returns; ", "Direct the transfer of any suit or appeal from any such court to any other court of equal or superior jurisdiction; ", "Make and issue general rules and prescribe forms for regulating the practice and proceedings of such courts; ", "Prescribe forms in which books, entries and accounts shall be kept by the officers of any such courts; and settle tables of fees to be allowed to the sheriff, attorneys and all clerks and officers of courts: Provided that such rules, forms and tables shall not be inconsistent with the provisions of law for the time being in force, and shall require the previous approval, in the case of the high court at Calcutta, of the Governor-General in , and in other cases of the local government.\u201d ", "12. Section 224 of the Government of India Act 1935 more or less adopted Section 107 of the Act of 1915 with a few changes. ", "\u201c(1)Every High Court shall have superintendence over all courts in India for the time being subject to its appellate jurisdiction, and may do any of the following thing, that is to say,- ", "call for returns; ", "make and issue general rules and prescribe forms for regulating the practice and proceedings of such courts; ", "prescribe forms in which books, entries and accounts shall be kept by the officers of any such courts; and settle tables of fees to be allowed to the sheriff, attorneys, and all clerks and officers of courts: ", "Provided that such rules, forms and tables shall not be inconsistent with the provision of any law for the time being in force, and shall require the previous approval of the Governor. ", "(2) Nothing in this section shall be construed as giving to any jurisdiction to question any judgment of any inferior Court which is not otherwise subject to appeal or revision.\u201d Article 227 of the Constitution states: ", "227. Power of superintendence over all courts by (1) Every High Court shall have superintendence over all courts and tribunals throughout the territories in relation to which it exercises jurisdiction (2) Without prejudice to the generality of the foregoing provisions, may ", "(a) call for returns from such courts; ", "(b) make and issue general rules and prescribe forms for regulating the practice and proceedings of such courts; and ", "(c) prescribe forms in which books, entries and accounts shall be kept by the officers of any such courts (3) may also settle tables of fees to be allowed to the sheriff and all clerks and officers of such courts and to attorneys, advocates and pleaders practising therein: ", "Provided that any rules made, forms prescribed or tables settled under clause ( 2 ) or clause ( 3 ) shall not be inconsistent with the provision of any law for the time being in force, and shall require the previous approval of the Governor (4) Nothing in this article shall be deemed to confer on powers of superintendence over any court or tribunal constituted by or under any law relating to the Armed Forces.\u201d ", "13. It will be noticed that Art. 227 adds the words \u201cand tribunals\u201d and contains no requirement that the superintendence over subordinate courts and tribunals should be subject to its appellate jurisdiction. ", "14. , 1954 SCR 565, ,J. stated the power under Art. 227: ", "\u201cThis power of superintendence conferred by article 227 is, as pointed out by , in , to be exercised most sparingly and only in appropriate cases in order to keep within the bounds of their authority and not for correcting mere errors. As rightly pointed out by the Judicial Commissioner in the case before us the lower courts in refusing to make an order for ejectment acted arbitrarily. The lower courts realized the legal position but in effect declined to do what was by section 13(2) (i) incumbent on them to do and thereby refused to exercise jurisdiction vested in them by law. It was, therefore, a case which called for interference by the court of the Judicial Commissioner and it acted quite properly in doing so.\u201d (at 571) ", "15. It is axiomatic that the superintending power of under Art. 227 is to keep courts and tribunals within the bounds of the law. Hence, errors of law that are apparent on the face of the record are liable to be corrected. In correcting such errors, has necessarily to state what the law is by deciding questions of law, which bind subordinate courts and tribunals in future cases. Despite the fact that there is no equivalent of Art. 141 so far as are concerned, in , (1963) 3 SCR 338, J. stated: ", "\u201cThis raises the question whether an administrative tribunal can ignore the law declared by the highest court in the State and initiate proceedings in direct violation of the law so declared. Under Art. 215 , shall be a court of record including the power to punish for contempt of itself. Under Art. 226 , it has a plenary power to issue orders or writs for the enforcement of the fundamental rights and for any other purpose to any person or authority, including in appropriate cases any , within its territorial jurisdiction. Under Art. 227 it has jurisdiction over all courts and tribunals throughout the territories in relation to which it exercise jurisdiction. It would be anomalous to suggest that a tribunal over which has superintendant can ignore the law declared by that court and start proceedings in direct violation of it. If a tribunal can do so, all the sub-ordinate courts can equally do so, for there is no specific provision, just like in the case of , making the law declared by binding on subordinate courts. It is implicit in the power of supervision conferred on a superior tribunal that all the tribunals subject to its supervision should conform to the law laid down by it. Such obedience would also be conducive to their smooth working: otherwise there would be confusion in the administration of law and respect for law would irretrievably suffer. We, therefore, hold that the law declared by the highest court in the State is binding on authorities or tribunals under its superintendence, and that they cannot ignore it either in initiating a proceeding or deciding on the rights involved in such a proceeding.\u201d(at 366) ", "16. The aforesaid analysis shows that the decision by superior courts of record of questions of law and the binding effect of such decisions are implicit in the constitutional scheme of things. It is obvious that it is emphatically the province of the superior judiciary to answer substantial questions of law not only for the case at hand but also in order to guide subordinate courts and tribunals in future. That this is the core of the judicial function as outlined by the constitutional provisions set out above. ", "17. As to what is a substantial question of law has been decided way back in v. (1962) Suppl. 3 SCR 549 at pages 557-558 thus: ", "\u201c\u2026.The proper test for determining whether a question of law raised in the case is substantial would, in our opinion, be whether it is of general public importance or whether it directly and substantially affects the rights of the parties and if so whether it is either an open question in the sense that it is not finally settled by this or by or by the Federal or is not free from difficulty or calls for discussion of alternative views. If the question is settled by the highest or the general principles to be applied in determining the question are well settled and there is a mere question of applying those principles or that the plea raised is palpably absurd the question would not be a substantial question of law.\u201d ", "18. It is clear, therefore, that the decision of a substantial question of law is a matter of great moment. It must be a question of law which is of general public importance or is not free from difficulty and/or calls for a discussion of alternative views. It is clear, therefore, that a judicially trained mind with the experience of deciding questions of law is a sine qua non in order that such questions be decided correctly. Interestingly enough, our attention has been drawn to various Acts where appeals are on questions of law/substantial questions of law. \u201c?i) The Electricity Act , 2003 ", "125. Appeal to - Any person aggrieved by any decision or order of , may, file an appeal to the within sixty days from the date of communication of the decision or order of to him, on any one or more of the grounds specified in Section 100 of the Code of Civil Procedure, 1908 (5 of 1908): Provided that the may, if it is satisfied that the appellant was prevented by sufficient cause from filing the appeal within the said period, allow it to be filed within a further period not exceeding sixty days. ", "(ii) The National Green Act , 2010 Section 22 . Appeal to - Any person aggrieved by any award, decision or order of the tribunal, may, file an appeal to the , within ninety days from the date of communication of the award, decision or order of , to him, on any one or more of the grounds specified in Section 100 of the Code of Civil Procedure, 1908 . ", "Provided that , entertain any appeal after the expiry of ninety days, if it is satisfied that the appellant was prevented by sufficient cause from preferring the appeal. ", "(iii) The Telecom Regulatory Authority of India Act , 1997 Section 18 . Appeal to Supreme Court - (1) Notwithstanding anything contained in the Code of Civil Procedure, 1908 or in any other law, an appeal shall lie against any order, not being an interlocutory order, of to on one or more of the grounds specified in section 100 of that code. ", "(2) No appeal shall lie against any decision or order made by with the consent of the parties. ", "(3) Every appeal under this section shall be preferred within a period of ninety days from the date of the decision or order appealed against: Provided that may entertain the appeal after the expiry of the said period of ninety days, if it is satisfied that the appellant was prevented by sufficient cause from preferring the appeal in time. ", "(iv) The Securities and Exchange Board of India Act , 1992 Section 15Z . Appeal to . - Any person aggrieved by any decision or order of may file an appeal to the within sixty days from the date of communication of the decision or order of to him on any question of law arising out to such order: ", "Provided that may, if it is satisfied that the applicant was prevented by sufficient cause from filing the appeal within the said period, allow it to be filed within a further period not exceeding sixty days. ", "(v) Companies Act , 1956 Section 10GF . Appeal to . - Any person aggrieved by any decision or order of may file an appeal to the within sixty days from the date of communication of the decision or order of to him on any question of law arising out of such decision or order: ", "Provided that may, if it is satisfied that the appellant was prevented by sufficient cause from filing the appeal within the said period, allow it to be filed within a further period not exceeding sixty days.\u201d ", "19. Whether one looks at the old Section 100 of the Code of Civil Procedure or Section 100 of the Code of Civil Procedure as substituted in 1976, the result is that the superior courts alone are vested with the power to decide questions of law. ", "Section 100 (Before amendment) \u201c100(1). Save where otherwise expressly provided in the body of this Code or by any other law for the time being in force, an appeal shall lie to from every decree passed in appeal by any court subordinate to on any of the following grounds, namely: ", "the decision being contrary to law or to some usage having the force of law; ", "the decision having failed to determine some material issue of law or usage having the force of law; ", "a substantial error or defect in the procedure provided by this Code or by any other law for the time being in force, which may possibly have produced error or defect in the decision of the case upon the merits. (2) An appeal may lie under this section from an appellate decree passed ex-parte. ", "Section 100 (After amendment) ", "100. Second appeal (1) Save as otherwise expressly provided in the body of this Code or by any other law for the time being in force, an appeal shall lie to from every decree passed in appeal by any subordinate to , if is satisfied that the case involves a substantial question of law. ", "(2) An appeal may lie under this section from an appellate decree passed exparte. ", "(3) In an appeal under this section, the memorandum of appeal shall precisely state the substantial question of law involved in the appeal. (4) Where is satisfied that a substantial question of law is involved in any case, it shall formulate that question. (5) The appeal shall be heard on the question so formulated and the respondent shall, at the hearing of the appeal, be allowed to argue that the case does not involve such question : ", "Provided that nothing in this sub-section shall be deemed to take away or abridge the power of the to hear, for reasons to be recorded, the appeal on any other substantial question of law, not formulated by it, if it is satisfied that the case involves such question.\u201d ", "20. It is obvious that hitherto has entrusted a superior court of record with decisions on questions of law/substantial questions of law. Also, as has been pointed in , \u2019s judgment traditionally, such questions were always decided by in the country. The present Act is a departure made for the first time by . ", "21. In this regard, the respondents argued that since taxation is a specialised subject and there is a complete code laid down for deciding this subject, the present impugned Act being part of that code is constitutionally valid. For this purpose, the respondents have relied on a passage from the nine Judge Bench in , at para 77. ", "22. This Court in \u2019s case was faced with whether case, 1959 SCR 1350, has been correctly decided in so far as it said that where taxes are paid under a mistake of law, the person paying is entitled to recover from the such taxes on establishing the mistake and that this consequence flows from Section 72 of the Contract Act. In answering this question, this Court made an observation that so long as an appeal is provided to from the orders of the appellate tribunal, the Act would be constitutionally valid. This Court while deciding whether \u2019s case was correctly decided or not, was not faced with the present question at all. Further, at the time that \u2019s case was decided, the scheme contained in the Central Excise and Salt Act , 1944, required on a statement of case made to it to decide a question of law arising out of the order of the appellate tribunal, after which is to deliver its judgment and send it back to the appellate tribunal which will then make such orders as are necessary to dispose of the case in conformity with such judgment. The then statutory scheme of the Central Excise and Salt Act , 1944 is contained in Sections 35G to 35L . ", "\u201c35G Statement of case to High Court. ", "(1) The Collector of Central Excise or the other party may, within sixty days of the date upon which he is served with notice of an order under section 35C (not being an order relating, among other things, to the determination of any question having a relation to the rate of duty of excise or to the value of goods for purposes of assessment), by application in the prescribed form, accompanied, where the application is made by the other party, by a fee of two hundred rupees, require to refer to any question of law arising out of such order and, subject to the other provisions contained in this section, shall, within one hundred and twenty days of the receipt of such application, draw up a statement of the case and refer it to : ", "Provided that may, if it is satisfied that the applicant was prevented by sufficient cause from presenting the application within the period hereinbefore specified, allow it to be presented within a further period not exceeding thirty days. ", "(2) On receipt of notice that an application has been made under sub- section (1), the person against whom such application has been made, may, notwithstanding that he may not have filed such an application, file, within forty- five days of the receipt of the notice, a memorandum of cross- objections verified in the prescribed manner against any part of the order in relation to which an application for reference has been made and such memorandum shall be disposed of by as if it were an application presented within the time specified in sub- section (1). (3) If, on an application made under sub- section (1), refuses to state the case on the ground that no question of law arises, the Collector of Central Excise, or, as the case may be, the other party may, within six months from the date on which he is served with notice of such refusal, apply to and may, if it is not satisfied with the correctness of the decision of , require to state the case and to refer it, and on receipt of any such requisition, shall state the case and refer it accordingly. ", "(4) Where in the exercise of its powers under sub- section (3), refuses to state a case which it has been required by an applicant to state, the applicant may, within thirty days from the date on which he receives notice of such refusal, withdraw his application and, if he does so, the fee, if any, paid by him shall be refunded. 35H. Statement of case to court in certain cases. If, on an application made under section 35G , is of opinion that, on account of conflict in the decisions of High Courts in respect of any particular question of law, it is expedient that a reference should be made direct to the Court, may draw up a statement of the case and refer it through the President direct to the Court. ", "35I. Power of or to require statement to be amended. If the or the is not satisfied that the statements in a case referred to it are sufficient to enable it to determine the questions raised thereby, the may refer the case back to , for the purpose of making such additions thereto or alterations therein as it may direct in that behalf. 35J. Case before to be heard by not less than two Judges. (1) When any case has been referred to the under section 35G , it shall be heard by a Bench of not less than two Judges of the and shall be decided in accordance with the opinion of such Judges or of the majority, if any, of such Judges. ", "(2) Where there is no such majority, the Judges shall state the point of law upon which they differ and the case shall then be heard upon that point only by one or more of the other Judges of , and such point shall be decided according to the opinion of the majority of the Judges who have heard the case including those who first heard it. 35K. Decision of or on the case stated. (1) The or the hearing any such case shall decide the questions of law raised therein and shall deliver its judgment thereon containing the grounds on which such decision is founded and a copy of the judgment shall be sent under the seal of the and the signature of the Registrar to which shall pass such orders as are necessary to dispose of the case in conformity with such judgment. (2) The costs of any reference to or the which shall not include the fee for making the reference shall be in the discretion of the . ", "35L. Appeal to . An appeal shall lie to the from- ", "(a) any judgment of delivered on a reference made under section 35G in any case which, on its own motion or on an oral application made by or on behalf of the party aggrieved, immediately after the passing of the judgment, certifies to be a fit one for appeal to ; or ", "(b) any order passed by relating, among other things, to the determination of any question having a relation to the rate of duty of excise or to the value of goods for purposes of assessment.\u201d ", "23. It is obvious that the decision of the nine Judge Bench was only referring to decisions of the appellate tribunal falling under sub-clause ", "(b) of Section 35L relating to orders passed by on questions having a relation to the rate of duty of excise or value of goods for the purpose of assessment and not to appeals from judgments of delivered on a reference under Section 35G after had decided on a question of law. It is clear, therefore, that the context of \u2019s decision was completely different and the decision did not advert to Sections 35G to 35L as they then stood. ", "24. Art. 323B was part of the constitution 42nd Amendment Act which was, as is well known, an amendment which was rushed through during the 1975 emergency. Many of its features were undone by the constitution 44th Amendment Act passed a couple of years later. One of the interesting features that was undone was the amendment to Art. 227. The 42nd Amendment substituted the following clause for clause (1) of Art. 227: ", "\u201c(1) Every High Court shall have superintendence over all courts subject to its appellate jurisdiction.\u201d ", "25. A cursory reading of the substituted clause shows that the old section 107 of the Government of India Act 1915 was brought back: Tribunals were no longer subject to , and subordinate courts were only subject to , if they were also subject to its appellate jurisdiction. As stated above, the 44th Amendment undid this and restored sub-clause (1) to its original position. ", "26. However, Art. 323B continues as part of the constitution. The real reason for the insertion of the said article was the same as the amendment made to Art. 227 \u2013 the removal of over tribunals. , undid the very raison d\u2019etre of Article 323B by restoring the supervisory jurisdiction of so that a reference to Article 323B would no longer be necessary as the legislative competence to make a law relating to tribunals would in any case be traceable to Entries 77 to79, 95 of List I, Entry 65 of List II and Entry 11A and 46 of List III of the 7th Schedule to the Constitution of India. ", "27. In a significant statement of the law, judgment, in upholding the vesting of original jurisdiction in , stated thus: ", "\u201cThe legitimacy of the power of s within constitutional democracies to review legislative action has been questioned since the time it was first conceived. The Constitution of India, being alive to such criticism, has, while conferring such power upon the higher judiciary, incorporated important safeguards. An analysis of the manner in which the Framers of our Constitution incorporated provisions relating to the judiciary would indicate that they were very greatly concerned with securing the independence of the judiciary. These attempts were directed at ensuring that the judiciary would be capable of effectively discharging its wide powers of judicial review. While the Constitution confers the power to strike down laws upon and , it also contains elaborate provisions dealing with the tenure, salaries, allowances, retirement age of Judges as well as the mechanism for selecting Judges to the superior courts. The inclusion of such elaborate provisions appears to have been occasioned by the belief that, armed by such provisions, the superior courts would be insulated from any executive or legislative attempts to interfere with the making of their decisions. The Judges of the superior courts have been entrusted with the task of upholding the Constitution and to this end, have been conferred the power to interpret it. It is they who have to ensure that the balance of power envisaged by the Constitution is maintained and that the legislature and the executive do not, in the discharge of their functions, transgress constitutional limitations. It is equally their duty to oversee that the judicial decisions rendered by those who man the subordinate courts and tribunals do not fall foul of strict standards of legal correctness and judicial independence. The constitutional safeguards which ensure the independence of the Judges of the superior judiciary, are not available to the Judges of the subordinate judiciary or to those who man created by ordinary legislations. Consequently, Judges of the latter category can never be considered full and effective substitutes for the superior judiciary in discharging the function of constitutional interpretation. We, therefore, hold that the power of judicial review over legislative action vested in under Articles 226 and in this under Article 32 of the Constitution is an integral and essential feature of the Constitution, constituting part of its basic structure. Ordinarily, therefore, the power of High s and to test the constitutional validity of legislations can never be ousted or excluded.(See Para 78) We also hold that the power vested in to exercise judicial superintendence over the decisions of all s and within their respective jurisdictions is also part of the basic structure of the Constitution. This is because a situation where are divested of all other judicial functions apart from that of constitutional interpretation, is equally to be avoided. (See Para 79) Before moving on to other aspects, we may summarise our conclusions on the jurisdictional powers of these . The are competent to hear matters where the vires of statutory provisions are questioned. However, in discharging this duty, they cannot act as substitutes for and which have, under our constitutional set- up, been specifically entrusted with such an obligation. Their function in this respect is only supplementary and all such decisions of the will be subject to scrutiny before of the respective High s.\u201d(see Para 93) ", "28. The stage is now set for the Attorney General\u2019s reliance on . ", "Various provisions of the Companies Act , 1956 were under challenge before . The effect of these provisions was to replace by a vested with original jurisdiction, and to replace with an appellate tribunal. After noticing the difference between courts and tribunals in paras 38 and 45, the court referred to the independence of the judiciary and to the separation of powers doctrine, as understood in the Indian Constitutional Context in paras 46 to 57. In a significant statement of the law, said: ", "\u201cThe Constitution contemplates judicial power being exercised by both courts and tribunals. Except the powers and jurisdiction vested in superior courts by the Constitution, powers and jurisdiction of courts are controlled and regulated by legislative enactments. are vested with the jurisdiction to entertain and hear appeals, revisions and references in pursuance of provisions contained in several specific legislative enactments. If jurisdiction of can be created by providing for appeals, revisions and references to be heard by the , jurisdiction can also be taken away by deleting the provisions for appeals, revisions or references. It also follows that the legislature has the power to create with reference to specific enactments and confer jurisdiction on them to decide disputes in regard to matters arising from such special enactments. Therefore it cannot be said that legislature has no power to transfer judicial functions traditionally performed by courts to .\u201d (para 87) In another significant paragraph, the Constitution bench stated: \u201cBut when we say that the legislature has the competence to make laws, providing which disputes will be decided by courts, and which disputes will be decided by tribunals, it is subject to constitutional limitations, without encroaching upon the independence of the judiciary and keeping in view the principles of the rule of law and separation of powers. If tribunals are to be vested with judicial power hitherto vested in or exercised by courts, such tribunals should possess the independence, security and capacity associated with courts. If the tribunals are intended to serve an area which requires specialized knowledge or expertise, no doubt there can be technical members in addition to judicial members. Where however jurisdiction to try certain category of cases are transferred from courts to tribunals only to expedite the hearing and disposal or relieve from the rigours of the Evidence Act and procedural laws, there is obviously no need to have any non-judicial technical member. In respect of such tribunals, only members of the judiciary should be the Presiding Officers/Members. Typical examples of such special tribunals are Rent , Motor Accidents Claims and under several enactments. Therefore, when transferring the jurisdiction exercised by courts to tribunals, which does not involve any specialized knowledge or expertise in any field and expediting the disposal and relaxing the procedure is the only object, a provision for technical members in addition to or in substitution of judicial members would clearly be a case of dilution of and encroachment upon the independence of the judiciary and the rule of law and would be unconstitutional.\u201d(at para 90) The Bench then went on to hold that only certain areas of litigation can be transferred from courts to tribunals. (see para 92) In paragraphs 101 and 102 the law is stated thus: ", "\u201cIndependent judicial tribunals for determination of the rights of citizens, and for adjudication of the disputes and complaints of the citizens, is a necessary concomitant of the rule of law. The rule of law has several facets, one of which is that disputes of citizens will be decided by Judges who are independent and impartial; and that disputes as to legality of acts of the Government will be decided by Judges who are independent of the executive. Another facet of the rule of law is equality before law. The essence of the equality is that it must be capable of being enforced and adjudicated by an independent judicial forum. Judicial independence and separation of judicial power from the executive are part of the common law traditions implicit in a Constitution like ours which is based on the model. ", "The fundamental right to equality before law and equal protection of laws guaranteed by Art.14 of the Constitution, clearly includes a right to have the person\u2019s rights, adjudicated by a forum which exercises judicial power in an impartial and independent manner, consistent with the recognized principles of adjudication. Therefore wherever access to courts to enforce such rights is sought to be abridged, altered, modified or substituted by directing him to approach an alternative forum, such legislative act is open to challenge if it violates the right to adjudication by an independent forum. Therefore, though the challenge by is on the ground of violation of principles forming part of the basic structure, they are relatable to one of more of the express provisions of the Constitution which gave rise to such principles. Though the validity of the provisions of a legislative act cannot be challenged on the ground it violates the basic structure of the Constitution, it can be challenged as violative of constitutional provisions which enshrine the principles of the rule of law, separation of powers and independence of the judiciary.\u201d ", "29. \u2019s case dealt with one specialized tribunal replacing another specialized tribunal () at the original stage. It is significant to note that the first appeal provided to the appellate tribunal is not restricted only to questions of law. It is a full first appeal as understood in the section 96 sense \u2013 (See section 10FQ of the Companies Act). A further appeal is provided to under Section 10GF only on questions of law. When \u2019s case states in paragraph 87 that the jurisdiction of can be taken away by deleting provisions for appeals, revisions or references, and that these functions traditionally performed by courts can be transferred to tribunals, the court was only dealing with the situation of being supplanted at the original and first appellate stage so far as the company `jurisdiction\u2019 is concerned in a situation where questions of fact have to be determined afresh at the first appellate stage as well. These observations obviously cannot be logically extended to cover a situation like the present where is being supplanted by a tribunal which would be deciding only substantial questions of law. ", "30. The present case differs from \u2019s case in a very fundamental manner. which replaces in the country replaces them only to decide substantial questions of law which relate to taxation. In fact, delivered a report in 1978 called after its Chairman. This report had in fact recommended that should be set up. The report stated: ", "\u201c?II-6.10. In paragraph 11.30 of our Interim Report, we had expressed the view that the Government should consider the establishment of to deal with all matters arising under the Income-tax Act and other Central Tax Laws, and had left the matter for consideration in greater detail in our Final Report. We have since examined the matter from all aspects. ", "II-6.11. The problem of tax litigation in India has assumed staggering proportions in recent years. From the statistics supplied to us, it is seen that, as on 30th June, 1977, there were as many as 10,500 references under the direct tax laws pending with the various , the largest pendency being in Bombay, Calcutta, Madras, Karnataka and Madhya Pradesh. The number of references made to the in India under all the tax laws is of the order of about 3,300 in a year, whereas the annual disposals of such references by all the put together amount to about 600 in a year. In addition to these references, about 750 writ petitions on tax matters are also filed before the every year. Under the existing practice of having only a single bench for dealing with the tax matters and that too not all round the year, there is obviously no likelihood of the problem being brought down to manageable proportions at any time in, the future, but, on the other hand, it is likely to become worse. Even writ petitions seeking urgent remedy against executive action take several years for disposal. , which had considered this problem, recommended the creation of permanent Tax Benches in and appointment of retired Judges to such Benches under Article 224A of the Constitution to clear the backlog. Although more than 6 years have passed since that recommendation was made, the position of arrears in tax matters has shown no improvement but, on the other hand, it has worsened. In this connection, it would be worth noting that considered an alternative course for dealing with this problem through the establishment of but they desisted from making any recommendation to that effect us, in their opinion, that would involve extensive amendments to law and procedures. We have directed our attention to this matter in the context of the mounting arrears of tax cases before the courts. ", "II-6.12. The pendency of cases before the courts in tax matters has also a snow-balling effect all along the line of appellate hierarchies inasmuch as proceedings in hundreds of cases are initiated and kept pending, awaiting the law to be finally settled by after prolonged litigation in some other cases. This obviously adds considerably to the load of infructuous word in the and clutters up the files of appellate authorities at all levels, with adverse consequences on their efficiency. According to the figures supplied to us, out of tax arrears amounting to Rs.986.53 crores as on 31st December, 1977, Rs.293.26 crores (30 per cent) were disputed in proceedings before various appellate authorities and courts. ", "II-6.13. Apart from the delays which are inherent in the existing system, the jurisdiction pattern of also seems to contribute to the generation of avoidable work. At present, are obliged to hear references on matters falling within their jurisdiction notwithstanding that references on identical points have been decided by other . The decision of one is not binding on another even on identical issues. Finality is reached only when decides the issue which may take 10 to 15 years. ", "II-6.14. Tax litigation is currently handled by different Benches of the constituted on an ad hoc basis. The absence of permanent benches also accounts for the delay in the disposal of the tax cases by . ", "II-6.15. The answer to these problems, in our view, is the establishment of with all-India jurisdiction to deal with such litigation to the exclusion of . Such a step will have several advantages. In the first place, it would lead to uniformity in decisions and bring a measure of certainty in tax matters. References involving common issues can be conveniently consolidated and disposed of together, thereby accelerating the pace of disposal. Better co-ordination among the benches would make for speedy disposal of cases and reduce the scope for proliferation of appeals on the same issues before the lower appellate authorities, which in its turn will reduce the volume of litigation going up before as well. Once is established, the judges appointed to the Benches thereof will develop the requisite expertise by continuous working in this field. This would facilitate quicker disposal of tax matters and would also help in reducing litigation by ensuring uniformity in decisions. ", "II-6.16. In the light of the foregoing discussions, we recommend that the Government should take steps for this early establishment of with all-India jurisdiction to deal exclusively with litigation under the direct Tax laws in the first instance, with provisions for extending its jurisdiction to cover all other Central Tax laws, if considered necessary in the future. We suggest that such a court should be constituted under a separate statute. As the implementation of this recommendation may necessitate amendment of the constitution, which is likely to take time, we further recommend that Government may in the meanwhile, consider the desirability of constituting special Tax benches in to deal with the large number of Tax cases by continuously sitting throughout the year. The Judges to be appointed to these special benches may be selected from among those, who have special knowledge and experience in dealing with matters relating to direct Tax laws so that, when is established at a later date, these judges could be transferred to that Court. ", "II-6.17. should have Benches located at important centres. To start with it may have Benches at the following seven places, viz., Ahmedabad, Bombay, Calcutta, Delhi, Kanpur, Madras and Nagpur. Each Bench should consist of two judges. Highly qualified persons should be appointed as judges of , from among persons who are judges or who are eligible to be appointed as judges. In the matter of conditions of service, scales or pay and other privileges, judges of should be on par with the judges. ", "II-6.18. and, following it, have held that the and the tax authorities, being creatures of the Act cannot pronounce on the constitutional validity or vires of any provision of the Act; that; therefore, such a question cannot arise out of the order of the and cannot be made the subject matter of a reference to and a subsequent appeal to the Supreme court; and that such a question of validity or vires can be raised only in a suit or a writ petition. While an income-tax authority or the cannot decide upon the validity or vires of the other provisions of the law. We recommend that the powers of in this regard should be clarified in the law itself by specifically giving it the right to go into questions of validity of the provisions of the Tax Laws or of the rules framed thereunder. ", "II-6.19. Another important matter, in which we consider that the present position needs improvement, is the nature of the \u2019s jurisdiction in tax matters. Under the present law, the High \u2019s jurisdiction in such matters is merely advisory on questions of law. For this purpose, has to draw up a statement of the case and refer the same to the High for its opinion. After the High delivers its judgment on the reference, the matter goes back to the , which has then to pass such orders as are necessary to dispose of the case conformably to such judgment. Under this procedure, the aggrieved party before the has to file an application seeking a reference to the High on specified questions of law arising out of the \u2019s order. The hearing of such application by the , followed by the drawing up of the statement of the case to the High , delays the consideration of the issue by the High for a considerable time. Where the refuses to state the case as sought by the applicant, then again, the law provides for a direct approach to the High for issue of directions to to state the case to the High on the relevant question of law. This process also delays the consideration of the matter by the High court for quite some time. In addition to these types of delay, there will be further delays after the High decides the matter, as the has to pass consequential orders disposing of the case, before the relief, if any due, can be granted to the assessee. ", "II-6.20. In our view, the disposal of tax litigation can be speeded up considerably by vesting jurisdiction in the proposed to hear appeals against the orders of the on questions of law arising out of such orders. We, accordingly, recommend that the jurisdiction of the should be Appellate and not advisory. We also recommend that appeals before the should be heard by a Bench of two judges. The judgment of a division Bench should be binding on other division Benches of unless it is contrary to a decision of or of a full Bench of . II-6.21. In the matter of appeals before the , it would be necessary to make a special provision for enabling Chartered Accountants to appear on behalf of appellants or respondents to argue the appeals before it. Legal practitioners would, in any event, be entitled to appear before the . In addition, any other person, who may be permitted by the to appear before it, may also represent the appellant or the respondent in tax matters. ", "II-6.22. Our recommendation for setting up of may not be interpreted to be only a modified version of the concept of administrative and other tribunals authorized to be set up for various purposes under the amendments effected by the 42nd Amendment of the Constitution. , which we have in view, will be a special kind of High court with functional jurisdiction over tax matters and enjoying judicial independence in the same manner as . The controversy generated by the 42nd Amendment to the Constitution should not, therefore, be held to militate against the proposal for the establishment of to exercise the functions of in tax matters.\u201d This recommendation was not acceded to by . ", "31. It is obvious, that substantial questions of law which relate to taxation would also involve many areas of civil and criminal law, for example Hindu Joint Family Law, partnership, sale of goods, contracts, Mohammedan Law, Company Law, Law relating to Trusts and Societies, Transfer of Property, Law relating to Intellectual Property, Interpretation of Statutes and sections dealing with prosecution for offences. It is therefore not correct to say that taxation, being a specialized subject, can be dealt with by a tribunal. All substantial questions of law have under our constitutional scheme to be decided by the superior courts and the superior courts alone. Indeed, one of the objects for enacting s Act , as stated by the Minister on the floor of the , is that can lay down the law for the whole of India which then would bind all other authorities and tribunals. This is a direct encroachment on Art. 227 to decide substantial questions of law which would bind all tribunals vide case, supra. ", "32. In fact, it is a little surprising that is interposed between the appellate and for the very good reason that ultimately it will only be that will declare the law to be followed in future. As the appellate tribunal is already a second appellate court, it would be wholly unnecessary to have a National Tax decide substantial questions of law in case of conflicting decisions of and Appellate s as these would ultimately be decided by itself, which decision would under Article 141 be binding on all tax authorities and tribunals. Secondly, in all tax matters, the is invariably a party and is ideally situated to decide substantial questions of law which arise between the and private persons, being constitutionally completely independent of executive control. The same cannot be said of tribunals which, as states, will have to be under a nodal ministry as tribunals are not under the supervisory jurisdiction of the . ", "33. Indeed, other constitutions which are based on the model, like the British North America Act which governs Canada have held likewise. In Attorney General for Quebec v. (1978), Vol.86 DLR [3d] 161 a transport tribunal was given appellate jurisdiction over . The tribunal performed no function other than deciding questions of law. Since this function was ultimately performed only by superior courts, the impugned section was held to be unconstitutional. This judgment was followed in Re. Residential Tenancies Act, 123 DLR (3d) 554. This judgment went further, and struck down the Residential Tenancy Act which established a tribunal to require landlords and tenants to comply with the obligations imposed under the Act. The court held: ", "\u201c delivered a careful and scholarly unanimous judgment in which each of these questions was answered in the negative. The concluded it was not within the legislative authority of Ontario to empower to make eviction orders and compliance orders as provided in the Residential Tenancies Act, 1979. The importance of the issue is reflected in the fact that five Judges of the , including the Chief Justice and Associate Chief Justice, sat on the appeal.\u201d It then went on to enunciate a three steps test with which we are not directly concerned. The finally concluded: ", "\u201cImplicit throughout the argument advanced on behalf of the Attorney- General of Qntario is the assumption that the Court system is too cumbersome, too expensive and therefore unable to respond properly to the social needs which the residential Tenancies Act, 1979 is intended to meet. All statutes respond to social needs. The are unfamiliar with equity and the concept of fairness, justice, convenience, reasonableness. Since the enactment in1976 of the legislation assuring \u201csecurity of tenure\u201d the of Ontario have been dealing with matters arising out of that legislation, apparently with reasonable dispatch, as both landlords and tenants in the present proceedings have spoken clearly against transfer of jurisdiction in respect of eviction and compliance orders from the to a special commission. It is perhaps also of interest that there is no suggestion in the material filed with us that favoured removal from the of the historic functions performed for over 100 years by the . ", "I am neither unaware of, nor unsympathetic to, the arguments advanced in support of a view that s.96 should not be interpreted so as to thwart or unduly restrict the future growth of provincial administrative tribunals. Yet, however worthy the policy objectives, must be recognized that we, as a , are not given the freedom to choose whether the problem is such that provincial, rather than federal, authority should deal with it. We must seek to give effect to the Constitution as we understand it and with due regard for the manner in which it has been judicially interpreted in the past. If the impugned power is violative of s.96 it must be struck down.\u201d ", "34. In v. The Queen Director of Public Prosecutions v Attorney General of Jamaica (intervener) 1976 (1) All ER 353, had to decide a matter under the Jamaican Constitution. A Gun Courts Act, 1974 was passed by in which it set up various courts. A question similar to the question posed in the instant case was decided thus: ", "\u201cAll constitutions on the Westminister model deal under separate chapter heading with the legislature, the executive and the judicature. The chapter dealing with the judicature invariably contains provisions dealing with the method of appointment and security of tenure of the members of the judiciary which are designed to assure to them a degree of independence from the other two branches of government. It may, as in the case of Constitution of Ceylon, contain nothing more. To the extent to which the constitution itself is silent as to the distribution of the plenitude of judicial power between various courts it is implicit that it shall continue to be distributed between and exercised by the courts that were already in existence when the new constitution came into force; but the legislature, in exercise of its power to make laws for the \u2018peace, order and good government of the state, may provide for the establishment of new courts and for the transfer to them of the whole or part of the jurisdiction previously exercisable by an existing court. What, however, is implicit in the very structure of a constitution on the Westminister model is that judicial power, however it be distributed from time to time between various courts, is to continue to be vested in persons appointed to hold judicial office in the manner and on the terms laid down in the chapter dealing with the judicature, even though this not expressly stated in the constitution (Liyanage v. R [1966] All ER 650 at 658 [1976] AC 259 at 287, 288] The more recent constitutions on the Westminister model, unlike their earlier prototypes, include a chapter dealing with fundamental rights and freedoms. The provisions of this chapter form part of the substantive law of the state and until amended by whatever special procedure is laid down in the constitution for this purpose, impose a fetter on the exercise by the legislature, the executive and the judiciary of the plenitude of their respective powers. The remaining chapters of the constitutions are primarily concerned not with the legislature, the executive and the judicatures as abstractions, but with the persons who shall be entitled collectively or individually to exercise the plenitude of legislative, executive or judicial powers \u2013 their qualifications for legislative, executive or judicial office, the method of selecting them, their tenure of office, the procedure to be followed where powers are conferred on a class of persons acting collectively and the majorities required for the exercise of these powers. Thus, where a constitution on the Westminister model speaks of a particular \u2018court\u2019 already in existence when the constitution comes into force, it uses this expression as a collective description of all those individual judges who, whether sitting alone or with other judges or with a jury, are entitled to exercise the jurisdiction exercised by that court before the constitution came into force. Any express provision in the constitution for the appointment or security of tenure of judges of that court will apply to all individual judges subsequently appointed to exercise an analogous jurisdiction, whatever other name may be given to the \u2018court\u2019 in which they sit (Attorney General for Ontario v. attorney General for Canada.) Where, under a constitution on the Westminister model, a law is made by the parliament which purports to confer jurisdiction on a court described by a new name, the question whether the law conflicts with the provisions of the constitution dealing with the exercise of the judicial power does not depend on the label (in the instant case \u2018\u2019) which the parliament attaches to the judges when exercising the jurisdiction conferred on them by the law whose constitutionality is impugned. It is the substance of the law that must be regarded, not the form. What is the nature of the jurisdiction to be exercised by the judges who are to compose the court to which the new label is attached? Does the method of their appointment and the security of their tenure conform to the requirements of the constitution applicable to judges who, at the time the constitution came into force, exercised jurisdiction of that nature? (Attorney General for \u2019 Society of Australia).\u201d ", "35. Ultimately, a majority of the court found that the provisions of the 1974 Act, in so far as they provide for the establishment of a full court division of consisting of three resident Magistrates were unconstitutional. ", "36. It was also argued by the learned Attorney General that under Section 260A of the Income Tax Act and other similar tax laws could be taken away by ordinary law and such sections could be deleted. If that is so surely the jurisdiction vested in by the said section can be transferred to another body. ", "37. It is well settled that an appeal is a creature of statute and can be done away by statute. The question posed here is completely different and the answer to that question is fundamental to our jurisprudence: that a jurisdiction to decide substantial questions of law vests under our constitution, only with and , and cannot be vested in any other body as a core constitutional value would be impaired thereby. ", "38. In fact, the Attorney General in his written argument at paras 16 and 21(a) has stated before us: ", "\u201c16. It is submitted that the present Act does not take away the power of judicial superintendence of under Article 227. Direct appeal to from the decisions of a tribunal of first instance is an acceptable form of judicial scrutiny. Provision for direct appeal to from the decision of a tribunal can be purely on questions of law as well. Since as a rule does not exercise its power of judicial superintendence when an appeal is provided to , the power of judicial superintendence of over the tribunal stands curtailed in such cases as well. But this curtailment does not violate the rule of law as a court of law i.e. continues to be the final interpreter of the law. By the same analogy a decision of an appellate tribunal with unrestricted right of appeal to will not curtail the power of under 227 as recourse to under Articles 226/227 would still be available if the tribunal exceeds its jurisdiction or violates the principles of natural justice or commits such other transgressions. ", "21. (a) The present Act provides ample scope for judicial scrutiny in the form of an Appeal under Section 24 of the Act and also under Articles 226/227, Article 32 and Article 136 of the Constitution.\u201d ", "39. On reading the above argument, it is clear that even according to this argument, power of judicial review under Articles 226/227 has in fact been supplanted by , something which said cannot be done. See Para 93 of L. Chandra Kumar\u2019s case quoted above. for Protection of Democratic Rights, 2010 (3) SCC 571, a Constitution Bench of this Court held: ", "\u201c39. It is trite that in the constitutional scheme adopted in India, besides supremacy of the Constitution, the separation of powers between the legislature, the executive and the judiciary constitutes the basic features of the Constitution. In fact, the importance of separation of powers in our system of governance was recognised in Special Reference No. 1 of 1964 [AIR 1965 SC 745 : (1965) 1 SCR 413] , even before the basic structure doctrine came to be propounded in the celebrated case of [] , wherein while finding certain basic features of the Constitution, it was opined that separation of powers is part of the basic structure of the Constitution. Later, similar view was echoed in [1975 Supp SCC 1] and in a series of other cases on the point. Nevertheless, apart from the fact that our Constitution does not envisage a rigid and strict separation of powers between the said three organs of the , the power of judicial review stands entirely on a different pedestal. Being itself part of the basic structure of the Constitution, it cannot be ousted or abridged by even a constitutional amendment. ( [ : 1997 SCC (L&S) 577] .) Besides, judicial review is otherwise essential for resolving the disputes regarding the limits of constitutional power and entering the constitutional limitations as an ultimate interpreter of the Constitution.\u201d \u201c68. Thus, having examined the rival contentions in the context of the constitutional scheme, we conclude as follows: ", "(iii) In view of the constitutional scheme and the jurisdiction conferred on this Court under Article 32 and on under Article 226 of the Constitution the power of judicial review being an integral part of the basic structure of the Constitution, no Act of can exclude or curtail the powers of the constitutional courts with regard to the enforcement of fundamental rights. As a matter of fact, such a power is essential to give practicable content to the objectives of the Constitution embodied in Part III and other parts of the Constitution. Moreover, in a federal constitution, the distribution of legislative powers between and involves limitation on legislative powers and, therefore, this requires an authority other than to ascertain whether such limitations are transgressed. Judicial review acts as the final arbiter not only to give effect to the distribution of legislative powers between and s, it is also necessary to show any transgression by each entity. Therefore, to borrow the words of Lord , judicial review is justified by combination of \u201cthe principles of separation of powers, rule of law, the principle of constitutionality and the reach of judicial review.\u201d ", "40. In v. Attorney General for Canada, 1931 AC 311, Lord said: ", "\u201cTheir Lordships entertain no doubt that time alone will not validate an Act which when challenged is found to be ultra vires; nor will a history of a gradual series of advances till this boundary is finally crossed avail to protect the ultimate encroachment.\u201d At Pg 317. ", "41. and have allowed tribunalization at the original stage subject to certain safeguards. The boundary has finally been crossed in this case. I would, therefore, hold that the National Tax Tribunals Act is unconstitutional, being the ultimate encroachment on the exclusive domain of the superior in India. ", "\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026..J. ", "() New Delhi, September 25, 2014 ITEM NO.1A COURT NO.1 SECTION XVIA (For Judgment) S U P R E M E C O U R T O F I N D I A RECORD OF PROCEEDINGS Transfer Case (Civil) No(s). 150/2006 MADRAS BAR ASSOCIATION Petitioner(s) VERSUS UNION OF INDIA & ANR. Respondent(s) WITH C.A. No. 3850/2006 C.A. No. 3862/2006 C.A. No. 3881/2006 C.A. No. 3882/2006 C.A. No. 4051/2006 C.A. No. 4052/2006 T.C.(C) No. 116/2006 T.C.(C) No. 117/2006 T.C.(C) No. 118/2006 W.P.(C) No. 621/2007 W.P.(C) No. 697/2007 ", "Date : 25/09/2014 These matters were called on for Judgment today. ", "For Petitioner(s) Mr. , Attorney General\u2019s Mr. , Adv. ", "Mr. ,Adv. ", "Mr. ,Adv. ", "Mr. Adv. ", ":1: ", "Mr. Adv. ", "Mr. Adv. ", "Mr. ,Adv. ", "Mr. Adv. ", "Mr. ,Adv. ", "Mr. , Adv. ", "For Respondent(s) Mr. ,Adv. Mr. ,Adv Mr. , Adv. Mr. , Adv. Ms. , Adv. Mr. , Adv. M/s. Parekh & Co. Mr. ,Adv. Mr. , Adv. Mr. , Adv. Mr. , Adv. Mr. ,Adv. Mr. , Adv. Mr. , Adv. Mr. , Adv. ", "Hon'ble Mr. Justice pronounced the Judgment on behalf of Hon'ble the Chief Justice, His Lordship, Hon'ble Mr. Justice and Hon'ble Mr. Justice . ", ":2: ", "Hon'ble Mr. Justice pronounced a separate Judgment concurring in the result. ", "All matters are disposed of in terms of reportable Judgments. 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