<NAME>, C.J.

1. In 1882 the 1st defendant executed a mortgage, Exhibit A, of the suit properties in favour of one <NAME>, 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 <NAME>, 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 <ORG> in <NAME> v. <NAME> (1914) A.C. 132 : 83 L.J. Ch. 349 : 110 L.T. 434 : 58 S.J. 218 and by <ORG> in <CITATION> 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: <NAME> 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 <NAME> v. <NAME> 3 Mer. 210 : 17 R.R. 67 : 36 E.R. 81. <ORG> have held that decision to be inapplicable to India in <NAME> v. <NAME> 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 <NAME> v. <NAME> 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 <CITATION> 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 <CITATION> 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 <NAME>, 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 <NAME>, 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. <NAME>, J.--I entirely agree with my <NAME>. The 1st defendant was the owner of the properties in <NAME> 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" <NAME> for Rs. 185. It was said' that this purchase by <NAME> was really benami for the plaintiff. There are recitals in some of the documents which show that <NAME> was only a name-lender for the 1st plaintiff; but it is not necessary to pursue this matter further, because nothing turns upon it. <NAME> 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 <NAME> 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. <NAME>, 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 <NAME> 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. <NAME> on Deeds, page 80, and the observations of <ORG>, in <ORG> v. <NAME> 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 <ORG> 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 <NAME>, the 1st plaintiff's mortgage-debt was extinguished. Mr. <NAME> 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. <NAME> for the respondent. That section was intended to introduce with some limitations the rule of law enunciated in <NAME> v. <NAME> 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, <ORG> in <NAME> v. <NAME> (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 <ORG> 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 <NAME>, J., in the case reported as <NAME> v. <NAME> 7 C.L.J. 1 at p. 32 but <ORG> reversed this decision. <CITATION> 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. <CITATION> 23 Ind. Cas. 121 : 38 B. 369 : 16 Bom. L.R. 26 and <CITATION> 23 Ind. Cas. 559 : 36 A. 327 : 12 A.L.J. 457 are to the same effect. In <NAME> v. <NAME> 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 <CITATION> 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 <ORG> 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 <ORG> mortgagee was not a party; and then brought a suit to recover possession of the property from the <ORG> 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 <ORG> 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 <ORG> 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. <CITATION> 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.


JUDGMENT <NAME>. 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 <ORG> ('Association' for short) and its five members. Facts relevant for the purpose of disposal of the appeal are as under.

2. <ORG> ('<ORG>' for short) is a <ORG> 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 <ORG> is engaged in the business of, amongst others, manufacture of iron and steel materials. The <ORG> is managed and controlled by a Board of Directors, which include two nominee Directors, one nominated by <ORG> and the other by <ORG>. The work-force of the <ORG> 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 <ORG>.

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 <ORG> 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 <ORG>, 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 <ORG> 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 <ORG> on the grounds, that no writ lay against the <ORG> 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 <ORG> 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 <ORG>. 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 <ORG> that <ORG>, through its various decisions, had laid down the tests for ascertaining whether a <ORG> was an instrumentality or agency of the <ORG> 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 <ORG> 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 <ORG>. Though a number of cases of <ORG> dealing with the above question were cited at the <ORG> 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 <CITATION> (1981-I-LLJ-103), which was decided by its Constitution Bench. In that case, the question -arose whether <ORG>, 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 <ORG> observed (pp. 112-113):

"The tests for determining as to when a corporation can be said to be an instrumentality or agency of <ORG> may now be culled out from the judgment in <ORG> 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 <ORG> 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 <ORG> case as follows:

(1) "One thing is clear that if the entire share capital of the corporation is held by <ORG>, it would go a long way towards indicating that the corporation is an instrumentality or agency of <ORG>."

(2) "Where the financial assistance of the <ORG> 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 <ORG> conferred or <ORG> protected."

(4) "Existence of deep and pervasive <ORG> Control may afford an indication that the corporation is a <ORG> 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 <ORG> is transferred to a corporation, it would be a strong factor supportive of the inference of the corporation being an instrumentality or agency of <ORG>."

If on a consideration of these relevant factors it is found that the corporation is an instrumentality or agency of <ORG>, it would, as pointed out in <ORG> 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 <ORG> at Srinagar was a 'State' under Article 12. The above quoted tests have been quoted with approval and followed by <ORG> in the latest cases of <CITATION> (1988-I-LLJ-3-41) and <ORG> v. Defence Minister-cum-Chairman BOG, <ORG> (1989-I-LLJ-263).

8. In the earlier case of <NAME> v. <ORG> (1981-I-LLJ-79) the above tests were quoted with approval. It was pointed out by <ORG> 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 <ORG>, the further conclusion emerged that it was 'State' and subject to the same constituional limitations as <ORG>. In <NAME> 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 <ORG> in the case of <NAME> (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 <ORG> 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 <ORG> 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 <ORG> by the financial institutions through such routine business transactions cannot certainly satisfy the first two tests laid down by <ORG>. Mr. <NAME>, 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 <ORG>. According to Mr. <NAME>, as the <ORG> 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 <ORG> enjoys a monopoly status, still then the third test would not stand satisfied as such status has to be '<ORG> conferred or <ORG> protected'. As there is no material on record to even indicate far less prove, the above ingredient, the contention of Mr. <NAME> in this regard must be negatived.

10. To bring home his contention that the fourth test stood conclusively satisfied, in the instant case, Mr. <NAME> strongly relied upon the determination of <ORG> in the case of <CITATION> . It will be necessary, therefore, to refer to and deal with the case of MC. <NAME> (supra) at length.

11. On December 4, 1985, a major leakage of oleum gas took place from one of the units of <ORG> and <ORG> in Delhi. This leakage affected a large number of persons, both amongst the workmen and the public, and an Advocate practising in <ORG> 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 <ORG> and <ORG> in <ORG> 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 <ORG> 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 <ORG> was carrying on an industry which, according to the <ORG>'s own declared industrial policies, was ultimately intended to be carried out by itself, but instead of the <ORG> immediately embarking on that industry, <ORG> was permitted to carry it on under the active control and regulation of the <ORG>. 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 <ORG> to <ORG> in carrying on the industry. Taking aid of the American <ORG> Action doctrine, it was also argued on behalf of the applicants that private activity, if supported, controlled or regulated by the <ORG> might get so entwined with <ORG>al activity as to be termed <ORG> action and it would then be subject to the same constitutional restraints on the exercise of power as the <ORG>.

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 <ORG> under general statutory Law, such as the Industries (Development and Regulation) Act , 1951 was only in exercise of police power of regulation by the <ORG> and such regulation did not convert the activity of the private corporation into that of the <ORG>. It was contended that control which deemed a <ORG> an agency of the <ORG>, must be of the type where the <ORG> controlled the management policies of the <ORG>, whether by sizeable representation on the board of management or by necessity of prior approval of the <ORG> before any new policy of management was adopted, or by any other mechanism.

13. In order to deal with the rival contentions, <ORG> traced that part of the development of Article 12 where it embarked on the path of evolving criteria by which a <ORG> could be termed 'other authority' under Article 12. In doing so, the <ORG> considered its earlier decisions and quoted with approval the tests laid down in <ORG> case (supra) as applied in <NAME> case (supra) and the observations made in the latter. The <ORG> then pointed out that the controversy as to whether the manner in which a <ORG> was brought into existance had any relevance to the question whether it was <ORG> instrumentality or agency was set at rest in the case of <NAME> (supra). The <ORG> further pointed out that a <ORG> might be a Statutory <ORG> created by a statute or it might be a society registered under the Societies Registration Act or a <ORG> formed under the Companies Act : any such <ORG> would come within the ambit of Article 12 , if it was found to be an instrumentality or agency of the <ORG> on proper assessment of the relevant factors.

14. In the light of the above principles of law, the <ORG> proceeded to examine whether a Private Corporation such as <ORG>, 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 <ORG> first examined <ORG> 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 <ORG> found that the industry of 'Chemicals and Fertilisers' was specified in the First Schedule of the above Act as it was deemed by the <ORG> to be an industry of vital public interest, whose public import necessitated that the activity should be ultimately carried out by the <ORG> itself, though in the interim period with <ORG> support and under the <ORG> control, Private Corporations might also be permitted to supplement the <ORG> effort. The <ORG> 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 <ORG> and even empowered the <ORG> 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 <ORG> also took notice of the fact that <ORG> 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 <ORG> 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 <ORG> to ultimately operate this industry exclusively and invited functional control. The <ORG> next took note of the fact that, along with the extensive functional control, <ORG> 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 <ORG>, "Moreover, <ORG> 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, <ORG> 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 <ORG>'s power as economic agent, economic enterpreneur and allocator of economic benefits was subject to the limitations of fundamental rights vide <CITATION> ; <CITATION> ; <CITATION> (supra) and <NAME> v. <ORG> of Jammu and Kashmir (1980) 3 S.C.R. 1388 , why should a private corporation under the functional control of the <ORG> which is hazardous to the health and safety of the community and it is imbued with public interest and which the <ORG> 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 <ORG>, 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 <ORG> 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 <ORG> 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 <ORG>, 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 <ORG> mooted the question whether a <ORG>, like <ORG>, could be included within the ambit of Article 12 , it did not answer the same. It cannot, therefore, be said that <ORG> has expressed any opinion on the subject as to be binding upon us either as obiter or ratio decidendi.

18. Mr. <NAME>, however, submitted that even if it was held that <ORG> did not make any decision on the point, still then the observations made by it would have a persuasive effect. Accordingly, Mr. <NAME> submitted that from the observations made therein, he could successfully argue that the appellant-company was an intrumentality or agency of the <ORG>. We are unable to persuade ourselves to rely upon the observations of <ORG> 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 <ORG>, 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 <ORG> 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 <ORG> 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 <ORG> control" so as to satisfy the fourth test. In the case of <CITATION> (1975-I-LLJ-399), Justice <NAME> pointed out that a mere finding of the <ORG> control was also not determinative of the question whether a <ORG> was an instrumentality or agency of the <ORG>, since a <ORG> 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 <ORG> 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 <ORG> financial support plus an unusual degree of control over the management and policies might lead one to characterize an operation as <ORG> action. While on this point, we may, even at the risk of repetition, remind ourselves of the observation made in the case of <NAME> (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 <ORG> 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 <ORG>, 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 <ORG> loan would have to be called an instrumentality or agency of the <ORG>. 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 <ORG> 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.


PETITIONER: THE UNION OF INDIA Vs. RESPONDENT: RAM KANWAR AND OTHERS DATE OF JUDGMENT: 29/08/1961 BENCH: <NAME>, K. BENCH: <NAME>, 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 <ORG> under r. 75-A (1) of the Defence of India Rules originally for the purpose of occupation by a certain officer of <ORG> and afterwards by the officers of <ORG>. After the building was vacated by the said officers it was put in the possession of <ORG> which was a private dance and music school. The respondent's appeal to <ORG> for de-requisitioning the building having failed be filed a petition for mandamus for that purpose in <ORG> which was allowed. The appellant's appeal under the Letters Patent filed within 30 days under the rules of <ORG> 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 <ORG> 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 <ORG> v. <ORG>, 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 <ORG> 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 <ORG> (Circuit Bench) at Delhi in L.P.A. No. 4 of 1955.

<NAME>, Attorney-General of India, <NAME>, <NAME> and <NAME>, for the appellant. <NAME> and <NAME>, for the respondents Nos. 1 to 6.

<NAME>, <NAME> and <NAME>, for the respondent No. 7.

1961. August 29. The Judgment of the Court was delivered by <NAME>, J.-This appeal by special leave is preferred against the judgment of a division bench of <ORG> of <ORG> at Delhi confirming that of a single Judge of <ORG> issuing a writ of mandamus against <ORG> directing it to restore possession of the flat requisitioned by the said <ORG> to the respondents.

One <NAME> 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, <ORG> 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 <NAME> of <ORG>. 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 <ORG>. After Mr. <NAME> vacated the flat, it was allotted to other officers. <NAME> requested the <ORG> 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 <ORG> rejected his request on the ground that on surrender by the officers of <ORG> it would be required for allotment to Central <ORG> officers. <NAME> 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, <NAME>. On November 4,1952, respondent No. 1 again requested the <ORG> to de- requisition the flat mainly on the ground that the said flat was not in use of the officers of <ORG> but was put in possession of <NAME>, 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 <ORG> informed the first respondent that he could execute a lease deed in favour of the <ORG> 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 <ORG>. The petition was heard by <NAME>, 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 <ORG> 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. <ORG> consisting of the Chief Justice and <NAME> 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 <NAME>, 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 <ORG> 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 <NAME> 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 <ORG> and, as that purpose did not cease to exist, the respondents are not entitled to ask for de-requisition of the said flat.

Mr. <NAME>, learned counsel for the respondents, seeks to sustain the order of <ORG> 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 <ORG> to a division bench of the same <ORG> ? (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 <ORG> 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 <ORG>.

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 <ORG> at Fort William, Madras and Bombay, Twenty The date of or of the <ORG> days the decree or order of Punjab in the exercise of its original jurisdiction.

LETTERS PATENT FOR <ORG>.

Clause 27. And WE do further ordain that it shall be lawful for <ORG> at Lahore from time to time to make, rules and orders for regulating the practice of the <ORG> 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 <ORG> 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 <ORG>, and also of the Governor-General in <ORG> 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 <ORG> 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.

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 <ORG> in the exercise of its Original Jurisdiction, under r. 4 of High <ORG> Rules for an appeal under cl. 10 of the <ORG> a period of limitation of 30 days is provided. If Art. 151 applies, the <ORG> 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 <ORG>, the High <ORG> 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 <ORG> in exercise of its Original Jurisdiction to a division bench of that High <ORG>. Under el. 37 thereof, the provisions of the <ORG> are subject to the legislative powers of the Governor-General in <ORG> and, therefore, any rule made in exercise of a power conferred under the <ORG> must necessarily be subject to the provisions of the Limitation Act which is a law made by the <ORG>. 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 <ORG> in exercise of its original jurisdiction, and if there is no other limitation on that section, r. 4 of the High <ORG> 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 <ORG> makes the rule made by the High <ORG> 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 <ORG>, the High <ORG> has power to make a rule prescribing the period of limitation for a <ORG> appeal against an order of a single Judge made in exercise of the original jurisdiction of the High <ORG>, 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 <ORG>s in exercise of their original jurisdiction, if no rule similar to r. 4 is made by the said High <ORG> or High <ORG>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 <ORG> in exercise of the legislative power conferred upon the said High <ORG> under cl. 27 of the <ORG>. 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 <ORG> in <CITATION> , 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.).

<ORG> 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 <ORG>, for in none, of them the scope of s. 29 of the Limitation Act was considered. Indeed, Mr. <NAME> 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 <ORG> or <ORG> 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 <ORG> 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 <ORG>, a notice stating that <ORG>, 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, <ORG> 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 <ORG> to decide whether it was necessary or expedient to do so. After requisition, <ORG> 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 <ORG> an intention to confer a power on the <ORG> 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 <ORG> "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 <ORG> 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 <ORG> 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 <ORG> 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 <ORG>, and as that purpose, namely user by <ORG>, 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 <ORG>. 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 <ORG>. 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, <ORG> 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 <ORG>, 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 <ORG>, is a public purpose' being the purpose of the <ORG>, 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 <ORG> purpose is a public purpose. The argument proceeds that under the Constitution the <ORG> 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 <ORG> 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 <ORG>, 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 <CITATION> (1). There is a fallacy underlying this argument. The (1)  2 S. C. R. 867.

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 <ORG>, 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 <ORG>, 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 <ORG> 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.