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Civil Appeal Nos. 2815 2819(NT) of 1977 From the Judgment and Order dated 18.10.1976 of the Punjab & Haryana High Court in Civil Writ Nos. 1183, 1184, 1795, 1796 and 1797 of 1970. O.P. Sharma, L.K. Gupta and Miss A. Subhashini for the Appellant. S.T. Desai, J.D. Jain and Ms. Kawaljit Kochar for the Respondents. The Judgment of the Court was delivered by PATHAK, J. These appeals by special leave are directed against the judgment and order of the High Court of Punjab and Haryana dismissing the writ petitions filed by the appellant against proceedings for the assessment of sales tax. The appellant, the Government Medical Store Depot, Karnal, is a Depot functioning under the Assistant Director General (Stores) who is in charge of the Medical Stores Organisation in the country under the Directorate General of Health Services, Ministry of Health, Government of India, New Delhi. It is a department of the Central Government and supplies medicines and hospital equipment manufactured in India or imported from abroad to Government hospitals, 453 Government institutions, Health Centres, Dispensaries and Primary Health Units located in northern India, some of which are run by local bodies such as Panchayats, Panchayat Samitis, Zila Parishads and Municipalities. It does not deal with private hospitals and individuals. The organisation works as a public utility service on a 'no profit, no loss ' basis. The medical stores and hospital equipment are purchased by the appellant and supplied to the hospitals and medical institutions, after adding a service charge of 10 per cent on the cost of the indented stores. During the year 1956 57, a question arose whether the activities of the appellant brought it within the definition of the expression 'dealer ' as defined in section 2(d) of the Punjab General Sales Tax Act, 1948. The Excise and Taxation authorities took the view that the appellant was not a dealer because the transactions conducted by it did not include an element of profit. By a letter dated July 15, 1957, the appellant was informed by the Excise and Taxation Commissioner, Punjab, that it need not be registered under the Punjab General Sales Tax Act. On August 21, 1968, the Excise and Taxation Officer, Karnal took note of a decision of this Court in Deputy Commercial Tax Officer, Saidapet, Madras vs Enfield India Ltd. Co operative Canteen, [1968] 21 S.T.C. 317 and called upon the appellant to produce its account books for the years 1965 66, 1966 67 and 1967 68 for the purpose of assessment to sales tax on the Medical Stores and equipment supplied by it. The appellant was also directed to get itself registered as a dealer under the Act. The appellant replied on August 24, 1968 that it did not fall within the scope of the definition of 'dealer ', and it seems that the Government of India in the Ministry of Health also intervened in the matter. The Excise and Taxation Officer, however, continued to maintain that the appellant was a dealer within the meaning of the Act. The Excise and Taxation Officer then issued formal notices to the appellant for the production of its account books for the years 1964 65 to 1968 69, and after giving an opportunity to the appellant to be heard, he proceeded to make assessment orders dated March 25, 1970 for the years 1964 65 and 1965 66, and also passed penalty orders for each year under the Punjab General Sales Tax Act as well as under the Central Sales Tax Act. He also initiated assessment proceedings for the years 1966 67, 1967 68 and 1968 69. 454 The appellant filed five writ petitions in the High Court of Punjab and Haryana, challenging the assessment proceedings pertaining to the assessment years 1964 65 to 1968 69 respectively taken under the Punjab General Sales Tax Act and the Central Sales Tax Act. The writ petitions were dismissed by the High Court by a common judgment and order dated October 18, 1976. The High Court held that the appellant was a dealer notwithstanding that it was not carrying on a business for earning profit. Learned counsel for the appellant contends that the appellant is not a dealer because the activity carried on by it is pursued without any motive of earning profit and, therefore, it cannot be described as a business. It is pointed out that the definition of the word 'dealer ' in section 2(d) of the Punjab General Sales Tax Act is different from the definition of that word in section 2(c) of the Haryana General Sales Tax Act. While the Haryana Act states that a person is a dealer whether or not he is inspired by a profit motive in carrying on his business, no such statement is contained in the definition under the Punjab Act. It is urged that these appeals are governed by the Punjab General Sales Tax Act and not by the Haryana General Sales Tax Act. When the Punjab General Sales Tax Act, 1948, was enacted it applied to the territories of the State of Punjab as that State was constituted on the partition of India on August 15, 1947. The State of Punjab so constituted continued in existence until it was again partitioned under the with effect from the appointed day, November 1, 1966. The Punjab General Sales Tax Act, which had operated in the territories constituting the original State of Punjab up to October 31, 1966 continued as the law in force on and from November 1, 1966 even in those territories which now comprised the State of Haryana. This was pursuant to section 88, of the . Its continuance was subject to any change in the law effected by the Haryana Legislature. The Haryana Legislature could permit the Punjab General Sales Tax Act to continue in force subject to legislative modifications made by it in that law. Alternatively, it could supersede and repeal the Punjab Act by enacting an independent Haryana Act to replace it. The Haryana Legislature amended the Punjab Act from time to time. It did so, for instance, by the Punjab General Sales Tax (Haryana Amendment and Validation) Act, 1969. Later, the entire Punjab Act was repealed by the enactment of the Haryana General Sales Tax Act, 1973, which came into effect from May 5, 1973. Some provisions of the Haryana Act came into 455 force from an earlier date, among being them the definition of 'dealer ' set forth in section 2(c) of that Act which operated retrospectively with effect from September 7, 1955. The present appeals are concerned with the assessment years 1964 65 to 1968 69, and the question is whether they are governed by the definition of the word 'dealer ' in section 2(d) of the Punjab Act or by section 2(c) of the Haryana Act. During that period section 2(d) of the Punjab Act, in its application to the State of Haryana, defined the word 'dealer ' as follows: S.2(d). "Dealer" means any person including a Department of Government who in the normal course of trade sells or purchases goods that are actually delivered for the purpose of consumption in the State of Haryana irrespective of the fact that the main place of business of such person is out side the said State, and where the main place of business of any such person is not in the said State, 'dealer ' includes the local manager or agent of such person in Haryana in respect of such business." Section 2(c) of the Haryana General Sales Tax Act, however, defines the word 'dealer ' in the following terms: section 2(c). "dealer" means any person including a department of Government who carries on, whether regularly or otherwise, trade whether with or without a profit motive, directly or otherwise, whether for cash, deferred payment, commission, remuneration or other valuable consideration, of purchasing, selling, supplying or distributing any goods in the State, or importing into, or exporting out of the State any goods, irrespective of the fact that the main place of business of such person is outside the State and where the main place of business of such person is not in the State, includes the local manager or agent of such person in the State in respect of such business. " It is apparent that the existence or absence of a profit motive is irrelevant when identifying a 'dealer ' under the Haryana Act. No such statement of immateriality is contained in the definition of the word 'dealer ' under the Punjab Act as applied to the State of Haryana. 456 What is important to note is that the definition of the word 'dealer ' in the Haryana Act has been framed only for the purpose of the provisions of that Act. The opening words of the definition section, section 2, make it clear that the expressions defined by that section are the expressions as used in the Haryana Act. Wherever, the word 'dealer ' is used in the Haryana Act, one must turn to the definition contained in section 2(c) of that Act. Now, except for a few specified provisions, the Haryana General Sales Tax Act came into force on May 5, 1973. Section 6, its charging provision, commenced to operate from that date. Section 6(1) of the Haryana Act declares that the first year of which the turnover is liable to tax under that Act is the year "immediately preceding the commencement of this Act. " It is obvious that section 6 does not govern the assessment years which are the subject of these appeals. Therefore, it is immaterial for our purposes that the definition of the word 'dealer ' under the Haryana Act has to be read retrospectively with effect from September 7, 1955. Because, as we have pointed out, section 2(c) relates to the word 'dealer ' contained in the provisions of the Haryana Act and the charging provision of the Haryana Act did not operate during the assessment years with which these appeals are concerned. These appeals will be governed by the Punjab General Sales Tax Act, and it is section 2(d) of that Act which must be looked to for ascertaining the definition of the word 'dealer ' in that Act. It may be mentioned that section 65 of the Haryana General Sales Tax Act repealed the Punjab General Sales Tax Act. Section 65 contains a proviso that such repeal will not affect the previous operation of the repealed Act or any right, title, obligation or liability already acquired, accrued or incurred thereunder. The liability incurred by a dealer in respect of the years under consideration in these appeals is a liability incurred under the charging provision, section 4, of the Punjab General Sales Tax. To ascertain who such dealer is one must read the definition of the word 'dealer ' in the Punjab General Sales Tax Act. No reference is permissible for that purpose to the definition in the Haryana General Sales Tax Act. No doubt the further language in the proviso to section 65 of the Haryana General Sales Tax Act provides that anything done or any action taken in respect of the liability incurred under the Punjab General Sales Tax Act will be deemed to have been done or taken in the exercise of the powers conferred by or under the provisions of the Haryana Act as if that Act was in force on the date on which such thing was done or action taken. This merely refers to the provisions enacted for the purpose of enforcing the liability and realising the tax and does not affect the position that the charge is under section 4 of the Punjab General Sales Tax Act, and to appreciate who the 457 'dealer ' mentioned therein is, one must turn to section 2(d) of the Punjab Act. It will be noticed that the definition of the word 'dealer ' in section 2(d) of the Punjab Act does not treat the existence of a profit motive in the business as an immaterial factor. In Govt. Medical Store Depot, Gauhati vs The Supdt. of Taxes, Gauhati & Ors, ; , the question was whether a Government Medical Store Depot set up at Gauhati by the Central Government in the Ministry of Health, Family Planning and Urban Development, for the purpose of procuring and supplying medical stores to Central and State Government institutions could be made liable to sales tax under the Assan Finance (Sales Tax) Act, 1956 and under the . The appellant, the Government Medical Store Depot, took the stand that the supply of medical stores to the Government institutions were without any profit motive, on the basis of "no loss, no profit", and unless it was found that the transactions had been carried on with a view to making a profit the appellant could not be held to be a 'dealer ' liable to tax. This Court observed that in the definition of 'business ' the profit motive had not been omitted, and therefore without anything more it could not be said that the person carrying on those transactions was a dealer. The Court rested the burden on the Revenue to show that the transactions carried on by the appellant were carried on with a profit motive. In the end, inasmuch as the appeals before it were concerned with the years 1965 66 to 1967 68 having regard to the lapse of time the Court, while allowing the appeals and quashing the assessments, did not think it fit to remand the cases for fresh assessment proceedings. We think we should do likewise. Accordingly, the appeals are allowed, the judgment and order of the High Court are set aside and the assessment proceedings which are the subject of these appeals are quashed. In the circumstances of the case, there is no order as to costs. M.L.A. Appeals allowed.

Pursuant to section 88 of the , the Punjab General Sales Tax Act, 1948 continued as the law in force on and from Nov. 1, 1966 even in those territories which now comprise the State of Haryana. The Punjab Act was repealed by the enactment of the Haryana General Sales Tax Act 1973 which came into effect from May 5, 1973. Some Provisions of the Haryana Act came into force from an earlier date, among being them the definition of 'dealer ' set forth in section 2(c) of that Act which operated retrospectively with effect from Sept. 7, 1955. The appellant, Government Medical Store Depot, Karnal, set up by the Central Government, used to purchase medical stores and hospital equipment and supplied them only to Government hospitals, Government institutions, health centres, dispensaries and primary health clinics located in northern India on a 'no profit no loss ' basis. On August 21, 1968, the Excise and Taxation officer Karnal, after giving an opportunity to the appellant, held that the appellant was a dealer under the Punjab Act and proceeded to make assessment orders for the years 1364 65 and 1365 66, and also passed penalty orders for each year. He also initiated assessment proceedings for the years 1966 67 to 1968 69. The appellant 's writ petitions in the High Court challenging the aforesaid assessment proceedings were dismissed. Allowing the appeals by the appellant, ^ HELD: l.(i) The existence or absence of a profit motive is irrelevant when identifying a 'dealer ' under the Haryana Act. No such 451 statement of immateriality is contained in the definition of the word 'dealer ' under the Punjab Act as applied to the State of Haryana. The definition of the word 'dealer ' in the Haryana Act has been framed only for the purpose of the provisions of that Act. The opening words of the definition under section 2 make it clear that the expressions defined by that section are the expressions as used in the Haryana Act. Wherever the word 'dealer ' is used in the Haryana Act, one must turn to the definition contained in section 2(c) of that Act. Now, except for a few specified provisions, the Haryana General Sales Tax Act came into force on May 5, 1973. Section 6, its charging provisions, commenced to operate from that date. Section 6(1) of the Haryana Act declares that the first year of which the turnover is liable to tax under that Act is the year "Immediately preceding the commencement of this Act. " It is obvious that section 6 does not govern the assessment years which are the subject of these appeals. Therefore, it is immaterial as to whether the definition of the word 'dealer ' under the Haryana Act has to be read retrospectively with effect from Sept. 7, 1955. Section 2(c) relates to the word 'dealer ' contained in the provisions of the Haryana Act, and the charging provision of the Haryana Act did not operate during the assessment years with which these appeals are concerned. These appeals will be governed by the Punjab General Sales Tax Act, and it is section 2(d) of that Act which must be looked to for ascertaining the definition of the word 'dealer ' in that Act. [455H; 456A D] 1(ii) The definition of the word 'dealer ' under section 2(d) of the Punjab Act does not treat the existence of the profit motive in the business as an immaterial factor and the burden is on the revenue to show that the transactions carried on by the appellant were carried on with a profit motive. The assessment proceedings which are the subject of these appeals are therefore quashed. Having regard to the lapse of time, it is not right to remand the cases for fresh assessment proceedings. [457D E] 2. Section 65 of the Haryana General Sales Tax Act repealed the Punjab General Sales Tax Act. Section 65 contains a proviso that such repeal will not affect the previous operation of the repealed Act or any right, title, obligation or liability already acquired, accrued or incurred thereunder. The liability incurred by a dealer in respect of the years under consideration in these appeals is a liability incurred under the charging provision, section 4 of the Punjab General Sales Tax. To ascertain who such dealer is one must read the definition of the word 'dealer ' in the Punjab General Sales Tax Act. No reference is permissible for that purpose to the definition in the Haryana General Sales Tax Act. No doubt the further language in the proviso to section 65 of the Haryana 452 General Sales Tax Act provides that anything done or any action taken in respect of the liability incurred under the Punjab General Tax Act will be deemed to have been done or taken in the exercise of the powers conferred by or under the provisions of the Haryana Act as if that Act was in force on the date on which such thing was done or action taken. This merely refers to the provisions enacted for the purpose of enforcing the liability and realising the tax, and does not affect the position that the charge is under section 4 of the Punjab General Sales Tax Act, and that to appreciate who the 'dealer ' mentioned therein is, one must turn to section 2(d) of the Punjab Act. [456E H; 457A] Deputy Commercial Tax Officer, Saidapet, Madras vs Enfield India Ltd. Co operative Canteen, [1968] 21 STC 317 and Government Medical Store Depot, Gauhati vs The Supdt. of Taxes. Gauhati & Ors., ; , referred to.

minal Appeal No. 2244 of 1959. Appeal by special leave from the judgment and order dated 1959, May 5 of the Allahabad High Court in Criminal Appeal No. 1049 of 1958 and Government Appeal No. 1766 of 1958. Jai Gopal Sethi, O. L. Sareen and B. L. Kohli for the Appellants. G. C. Mathur and C. P. Lal fur the Respondent. March 9. The Judgment of Kapur and Das Gupta, JJ. was delivered by Kapur, J. Dayal, J., delivered a separate Judgment. KAPUR, J. The appellants and Prithviraj Singh were tried by the Sessions Judge, Hamirpur, the former for offences under section 302, read with section 149 and section 201 read with section 149 and of them some under 8. 147 and others under section 148 and the latter under section 201 read with section 149 of the Indian Penal Code. From amongst the accused persons Nathu Singh was acquitted and so was Prithviraj Singh but ten others were convicted under section 302 read with section 149 and section 201 read with section 149 and two of them were convicted under section 147 and others under 9. 148. The Sessions Judge sentenced the convicted persons to imprisonment for life under section 302 read with section 149, to three years ' rigorous imprisonment under section 201 read with section 149, two of them to two years ' rigorous imprisonment under section 141 and others to three years ' rigorous imprisonment under section 148 but all the sentences were concurrent. Against that order the convicted persons took an appeal to the High Court at Allahabad and the State appealed against the acquittal of Nathu Singh and also applied for enhancement of sentences against the con victed persons. The High Court dismissed the appeal of the convicted persons and allowed the appeal against Nathu Singh. Thus 11 persons were convicted and sentenced to imprisonment for life 771 and to other concurrent sentences and they have appealed to this court by special leave. The appellants and Prithviraj Singh are residents of village Kharela and they were on terms of enmity with the deceased Raja Ram Singh. On July 28, 1957, at about 3 30 p.m. the appellants collected in front of the house of Kali Charan appellant, two of them armed with lathis, two with pharsas and seven of them had spears. Dharam Singh appellant asked RajaRam Singh as to why he, had been abusing him to which the reply given by Rajaram Singh was that he was not in the habit of abusing any body at his back and if he felt like abusing any body he would do so to his face and he fixed his spear in the ground and stood there. Appellant Dharam Singh threw away the spear, rushed towards Rajaram Singh, caught hold of him by the waist and asked his ten companions to beat the enemy. Rajaram Singh was thereupon attacked with various weapons as a result or which he, fell down severely injured. He was still alive when appellants Sheo Rattan Singh and Gulab Singh struck on his neck with pharsas and partially severed it. At the instance of Dharam Singh, his cart was brought by others and Prithviraj Singh also arrived at the spot. Dharam Singh asked him to go home and bring his Dharam Singh 's) gun which Prithviraj Singh did and handed, over the gull and the bandolier of cartridges to Dharam Singh who loaded the gun, put the dead body of the deceased on the bullock cart and the ten persons then took away the dead body from the village and it is alleged that they left it in a nullah near village Jataura. There is a police post in the village of which Head Constable ' Shivsewak Singh is incharge and there is also is an armed guard there. At 3 45 p.m. Shyam Lal who is the brother in law (wife 's brother) of Rajaram Singh made a report at the police 772 post and at 7 30 p.m. he made a report at the police station Muskara which is 8 miles away from village Kharela. This occurrence was witnessed by five persons P. W. Babu Singh. P. W. Shivnath Singh, P. W. Ram Narain, P. W. Mulain Singh and P. W. Brij Rani. While the corpse was being taken in the bullock cart three witnesses deposed to having seen it being carried in the cart. They are Ram Nath P. W. 21, Tijiwa P. W. 22 and Jurkhan P. W. 23. In the High Court the appeal was heared in the first instance by Cak and Verms JJ. There was a difference of opinion between the learned judges and the matter was referred under section 429, Criminal Procedure Code to Desai J., who agreeing with Cak J., upheld the conviction of the ten appellants who were convicted by the Sessions Judge and set aside the acquittal of Nathu Singh. Thus 11 persons were convicted and they have appealed to this court by Special Leave. It was contended on behalf of the appellants that under section 429, Criminal procedure Code where there is difference of opinion between the judges constituting a Division Bench and the matter is referred to a third judge the opinion of the Judge acquiting the accused has to be treated in the same manner as the judgment of acquittal by the trial court and even though it may not be necessary 'to find compelling reasons for disagreeing with the opinion of the acquiting judge it is necessary that the judgment should show that all the findings and the reasons given in the opinion of the acquitting judge are mentioned in the opinion of the third judge and the judgment should indicate the reasons for disagreeing with the opinion of the acquitting Judge. We can see no warrant for this contention, Section 429 of the Criminal Procedure Code Provides: 773 " When the Judges composing the Court of appeal are equally divided in opinion, the case, with their opinions thereon shall be laid before another judge of the same Court, and such Judge, after such hearing (if any) as he thinks fit, shall deliver his opinion, and the judgment or order shall follow such opinion". All it says is that the opinion of the two judges who disagree shall be laid before another judge who after giving such hearing, if any, as he thinks fit, shall deliver his opinion and the judgment or order should be in accordance with such opinion. Now it is obvious that when the opinions of the two Judges are placed before a third Judge be would consider those two opinions and give his own opinion and the judgment has to follow the opinion of the third judge. Consequently on that opinion is based the judgment of the court. For all practical purposes the third Judge must consider the opinions of his two colleagues and then give his own opinion but to equate the requirements with appeals against acquittals is not justified by provisions of section 429 or by principle or precedent. Desai J., was of the opinion that the eye witnesses had seen the occurrence and their evidence must be accepted but there are certain circumstances proved by the evidence on the record which when considered materially affect the force of the finding in regard to oral evidence and which have to be considered in order to adjudicate on the correctness or otherwise of the prosecution case. The first point is whether the murder was committed in the village as is submitted by the prosecution? According to the prosecution the murder was committed in the village at 3.30 p.m. in the mouth of July in broad daylight on a public road and the number of injuries caused to Rajaram Singh are such that there must 774 have been a fair amount of blood spilt at the place. According to the prosecution evidence after the murder was committed Dharam Singh sent for his bullock cart which must necessarily have taken a little time. Meanwhile Babu Singh P.W. went and informed Shyam Lal who went to make a report at the police post in the village. It is stated to be about 4 furlongs away. It is contended by the appellants that if the murder had taken place as stated and there was an armed guard in the village, it would have been difficult for the appellants to have sent for the cart, to put the dead body on it and take it out of the village and that within the time between the commission of the murder and the time of the making of Report at the police post; that there is a considerable doubt about the occurrence having taken place in the village because no blood was found at the place of the murder; at least no evidence has been produced to show that there was any blood there. On behalf of the prosecution it was submitted that the evidence discloses that after the murder the blood was washed away by throwing a, good deal of water and plastering the place and thus no blood was found when the place was visited by the investiga ting Sub Inspector. It was also submitted that some blood was found on the wall of the chabutra in front of the house of the appellant Kali Charan which was collected in a small tin and was sent to the Chemical Examiner. It may here be pointed out that when the dead body was to the place where it was found 6 1/2 miles away from the place of occurrence the neck was cut and taken away and only the headless body was 'found there. That place was in the dry bed of a nullah. According to the prosecution; witness Ram Avtar there plenty of blood there but P. W. Raziuddin stated that blood was found in drops lying in adjacent places but it was not found in heavy quantities at one place. Blood stained earth was taken from the 775 wall of the chabutra of Kali Charan. Unstained earth was also taken from the same place which was also put in a small tin. Blood stained earth was also taken from the place in the bed of the nullah where the dead body was found. All these tins were sent to the Chemical Examiner. It is not quite clear what exactly was his finding but he found that the earth in two tins was blood stained but blood has not been shown to be of human origin. It is not clearly shown as to what was the extent of the blood on the wall of the chabutra of Kali Charan. Desai J., was of the opinion that a lot of blood must have been spilt at the place where the murder was stated to have been committed but Kali Charan poured water over the spot, therefore no blood was visible at the spot and the Investigating Officer found the place wet when he examined it at night and that no explanation was given by the appellants as to bow blood came to be on the wall of the chabutra. It does not appear from the examination of the appellants under section 342 that any question was put to Kali Charan in ragard to the finding of the blood on the wall of his chabutra nor was any of the other appellants asked this question. The High Court should not have used this fact against the appellants. Another circumstance which has been pressed at great length on behalf of the appellants is that no attempt was made to take any earth from the place and no investigation was made as to whether there was any blood at the spot or not. If at man 's neck is cut and he is caused the number of injuries that the deceased had, the amount of blood spilt there must have been in a fairly large quantity and it is difficult to imagine that just by pouring water over the spot and plastering it no blood was visible and even if it was not visible no blood could be found if any effort was made. No attempt seems to have been made to take the earth from there and send it. to the Chemical Examiner for the purpose 776 of examination. Desai J., has observed that the Investigating Officer found the ground to be wet. The Investigating Officer came there at II p.m. on the night of occurrence which was a dark night and if he found the place to be wet it is not clear whether it was wet because of water or because of blood. It was the month of July when any water poured at 3 30 p.m. should have dried up by 11 p.m. Anotier point which has been pressed on behalf of the appellants is that no trail of blood was discovered from the place where the murder is alleged to have been com. mitted to the place where the dead body was ultimately found in the dry bed of the nullah. Although the evidence is conflicting there was some amount of blood at the place where the dead body was found. The head had been completely severed and taken away. In the cart also there was some blood and a blood stained axe was also found there. Therefore if the head was out at the place where the dead body was found and there was blood oozing out at that time it is difficult to imagine that there would not be any blood oozing all the time and there would be no trail of blood. But none has been found. It may be pointed out that there was blood on the planks of the cart on which the dead body is alleged to have been taken. According to the books on Medical Jurisprudence blood does not coagulate till after four hours. Therefore the submission of the appellants that there should have been some trail of blood from the place where the murder was committed to the place where the dead body was taken has considerable force. The judgement of Desai, J., seems to indicate that the onus of certain matters was placed on the appellants which is unwarranted by law. For instance, the learned Judge said that the appellants were asked in the Magistrate 's court about the 777 evidence that they had killed Rajaram Singh at 3 30 p.m. in the abadi and had then carried away his dead body in the cart of Dharam Singh. and they contented themselves by denying all the allegations and none of them had said that the deceased was not murdered in the abadi and in the day time. The learned Judge then observed: "If he was not murdered in the adadi and in day time they must have heard when and where he was murdered. Their statements were not evidence governed by the Evidence Act and they could say that they had heard. Yet when they refrained from saying anything about it, it just shows that they had not heard that Raja Ram Singh was murdered elsewhere and at another time". This, in our opinion, was an erroneous approach to the question. At another place in his judgment the learned Judge again seems to have placed the onus on the appellants and that was concerning the ownership of the cart in which the dead body was taken. The finding of the bloodstained bullock cart was relied upon by the prosecution in support of their case. That evidence was attacked on the ground that there was no identification parade of the cart and the bullocks. The learned Judge said in regard to this matter that there was no necessity for any identification proceedings because if the Investigating Officer believed the witness who stated that the cart belonged to Dharam Singh then he was not required to cross examine the prosecution witnesses by asking them to identify the cart and the bullocks. He then observed: "Dharain Singh, Babu Singh and Prithviraj Singh appellants denied that the cart and the bullock produced were theirs but did not say to whom they belonged and how they were obtained by the police. They also did 778 not produce any evidence to rebut the evidence of the prosecution witnesses about their ownership". In that very connection the learned Judge has also relied on the fact that the bullock cart was brought from the bara of Ram Adhin Singh and the site plan prepared by S.H.O. showed that there, were signs of fresh removal of the bullock cart from the bara. Now this again is not admissible evidence because nothing shown on the plan unless deposed to by witnesses is evidence against the appellants. It was so held in Santa Singh vs State of Punjab (1) and Tori Singh vs State of Uttar Pradesh (2). There is another significant fact in regard to this cart According to prosecution witness Babu Singh, the bullock which were yoked in the cart belonged to Ram Adhin Singh when he was asked to identify he said one of them was the same but the second one was not the same which was yoked in the cart at the time when the dead body was being taken. It is an extraordinary circumstance that the bullocks which are alleged to have belonged to Ram Adhin Singh, and which were yoked to the cart carrying the dead body, which all the time remained in police custody got changed so that one of the bullocks is not the same. Another circumstance which is equally significant is the finding of the yoke of prosecution witness Tijiwa with the cart. It is stated that Tijiwa met the appellants when they were driving the cart away from the village. At the time Tijiwa was returning home bringing his employers cart. Tijiwa 's yoke was borrowed because the yoke of the cart driven by the appellants got broken and Tijiwa 's yoke was found at the place where the cart was subsequently dis covered. What happened to the broken yoke is not shown, how Tijiwa took his own cart back without the yoke to the village is not shown. This circum (1) A.I. (2) [1962] 3S.C.R. 779 stance does not seem to have received the attention of the High Court which it deserved. The appellants have vigorously pressed before us another argument which deals with the First Information Report and investigation by the police. According to the prosecution the occurrence was at about 3 30 p.m. and an information was given at the police post at 3 45 p.m. and according to the evidence of the prosecution witness Raziuddin, the Head Constable and two constables of the armed guard proceeded to recover the dead body and follow the murderers by following the track of the cart. They left the police post of Kharela at 3 45 p.m., and from there they went to the house of the appellant Kali Charan and then they followed the track of the bullock cart. At a distance of four or five paces from the place of occurrence they met Pancham Singh who does not seem to be a witness; so what he stated to the constable is not evidence. They then followed the track of the bullock cart and found the dead body lying in the nullah about three furlongs away from the ' abadi of village Jataura. The dead body was headless. They left the two armed guards at the place and proceeding a little further they found the bullock cart with the two bullocks and there was no one near the bullock cart. Head Constable Shivsewak Singh bad gone at 12 noon to Balatal for appearing as a witness. There are no entries in the Police Duty Register at the Police Post as to his return nor as to his going with Raziuddin and others following the track of the cart. Leaving the armed guard at the place where the dead body was found Head Constable Shivsewak Singh went to Jataura and called Chowkidar Sumera. At about 10 or 11 in the night he sent Chowkidar Sumera to Thana Charkhari to give information and it is stated that as a result of the 780 information given by Chowkidar Sumera the Sub Inspector in charge of Charkhari Police Station came to the place where the dead body was found and he started the investigation on the morning of July 29, 1957. He took the dead body into possession, held the inquest report and took bloodstained earth and the cart into possession. There is no reason why the Head Constable should have sent Sumera to the police station Charkhari when the offence was committed in the village in the jurisdiction of police station Muskara. It is next stated that the Officer in Charge of Muskara Police Station, Sub Inspector Basu Deo came to village Kharela at 11 p.m. There is no entry in the Register at the Police Post showing his coming to the place of the occurrence. He has deposed that he went to the place of occurrence and noticed that outside the house " 'Some water appeared to be lying and at places it appeared that the ground had been washed with hand and water". How in the middle of a dark night he could have seen all that has been explained and the appellants rightly challenge his very coming to the village at that time. From these circumstances the appellants submit that there is a great deal of doubt as to the time of the making of the First 'Information Report and the time and place of murder. We have these facts which cast a good deal of doubt as to the authenticity of the report or the investigation by the police of Muskara into the alleged occurrence. (1) if the information was given at the police post soon after the occurrence, as is alleged, there is no reason why the police should not have reached the place and prevented the removal of the dead body which was after all being carried on a bullock cart. (2) It is not shown by the entries of the Duty Register that the Head Constable returned from Balatal at 4 O 'Clock and came back to the village 781 (Kharela) and then proceeded to follow the track of the bullock cart in which the dead body was alleged to have been carried. (3) There is no reason why when the dead body was found near the nullah at about 6 30 p.m. the Head Constable should have sent the Chowkidar of Jataurs to Police Station Charkhari to make a report at that place and why the investigation should have.been carried on by the police of that police station and not by the police of Muskara Police Station when the latter had come to know of it about 6 30 p.m. that murder had been committed in their jurisdiction. (4) There is no reason why the Police Sub Inspector Kharela Police Post should go at 11 p.m. and in a most casual manner to the place of occurrence, see water lying at the place and that in the hot mouth of July. Why the next day he did not take any earth from that place is also a very significant question. (5) There is total absence of blood at the place of the occurrence. It is stated that there was some blood on the wall of chabutra of Kali Charan what was the extent and nature of the blood is not shown. How far the chabutra was from the exact place of murder is not shown. (6) There is no evidence at all that any earth was opened with human blood. (7) There is total absence of entries in the Duty Register. Therefore the coming of Sub Inspector Basu Deo is also doubtful. There is no indication that there was any trail of blood even for a short distance from the place of occurrence. (8) The evidence in regard to the borrowing of the yoke from prosecution witness Tijiwa is highly suspicious in the circumstances of this case. 782 (9) Lastly we find that the approach of the learned Judge to the case is not in accordance with law in that as to two or three matters he has approached the question as if it is for the defence to disprove certain facts. For instance the failure of the defence to produce reliable evidence to contradict eye witnesses there failure to state that the murder was not committed in the village ; there failure to say as to whom the cart belonged if it did not belong to Dharam Singh. Desai J., was of the opinion that no blood was found by Raziuddin on the way from the abadi to the nullah and no trail of blood could be expected because the bleeding must have stopped before the cart left the abadi. On what evidence he found that bleeding must have stopped is not clear. The learned Judge also relied upon the fact that Chowkidar Sumera made a report at the police station Charkhari about certain facts which are mentioned there. Sumera is not a witness. Therefore what he stated cannot be evidence in this case. It appears that the learned Judge also took into consideration the fact that the appellants were absconding and that they gave no explanation as to their absconding but they do pot seem to have been asked any question in regard to it. In regard to the witnesses Ram Nath, Tijiwa and Jurkhan who saw the dead body being carried in the cart, the learned Judge said that he found no reason to disbelieve their testimony. At another place in the judgement the learned Judge observed that when witnesses talked about the neck of Rajaram Singh being out they must have been tutored about it. In this view of the matter and taking other material improbabilities in the testimony of these witnesses which the learned Judge does not seem to have considered it is difficult to place any reliance on their evidence. 783 The whore case is full so many inconsistencies and improbabilities and peculiarities that it must be said that the case has not been established against the appellants beyond reasonable doubt. We are opinion that the High Court 's failure to consider the important circumstances disclosed by the evidence, and the error in wrongly placing onus on the accused has resulted in miscarriage of justice. The case therefore falls within the rule laid down in Pritam Singh vs State (1) and calls for our interference. In these circumstances the conviction of the appellants must be set aside and the appeal must be allowed. The appellants are acquited & must be released forthwith unless required in some other case. RAGHUBAR DAYAL, J. I have bad the advantage of perusing the judgment prepared by my learned brother Kapur, J. I agree with the interpretation of section 429, Cr. P.C. I am, however, of opinion that the circumstances urged for the appellants do not justify interference with the verdict of the High Court on questions of fact. They have all been considered by Desai J., in forming his opinion. He has relied on the statements of the eye witnesses. It is argued for the appellants that the circumstances tend to throw doubt on the correctness of the prosecution story that the incident took place inside the village abadi and that therefore the appellants ' conviction should be set aside. The first circumstance is that the incident took place at 3.30 p. m., information about it reached the police outpost four furlongs away at 3.45 p.m., the armed guard at the outpost then proceeded to the spot and yet it is said that the (1) ; 784 accused could remove the dead body from the spot prior to the arrival of the armed guard. The getting of the bullock cart and the loading of the corpse would have taken sufficient time and the arrival of the armed guard could have been within that time. In this connection, it is to be noticed that Babu Singh, P. W. 1, an eye witness, left the spot after the body had been removed on the cart. It was he who informed Shyam Lal about the incident. Thereafter, Shyam Lal left for the police outpost. Babu Singh states : "After the cart left I rain to the house of Raja Ram Singh. There we met Shyam Lal. I told Shyam Lal all what I witnessed. He went to the police outpost to make a report and I went home. " The first information report was lodged at the thana at 7.30 p.m. It mentions the fact of the dead body being taken away on the cart. In view of this fact it is clear that the armed guard could not have reached the spot in time to prevent the removal of the corpse. Another fact against the circumstance urged is that the incident did not take place at 3.30 p. m., which was really the time when Babu Singh informed Shyam Lal Shyam Lal dictated in the first information report : "At about 3.30 p.m., Babu Singh. came to my house and informed me as follows. ". The incident therefore must have started much earlier, say at about 3 O ' clock and the body must have been removed by about 3.25 p.m. The other circumstance urged. is that no bloodstained earth was found at the spot and that therefore this throws doubt on the incident having taken place at the spot alleged. It is in the prosecution evidence that some of the accused washed the 785 ground where blood had fallen and plastered it. According to the Sub Inspector, P. W. 27, bloodstained earth was taken in possession from the door of the accused Kalicharan Singh, which really means, from the front of his house. Siya Ram, P.W. 26, stated that a few places in the Chabutra where blood stains were detected were scraped and that the stains were on the walls of the Chabutra. The recovery list exhibit K 29 mentions : "blood stained earth was scraped from in front of the house of Sri Kali Charan, son of Bhan Singh, Thakur, ;and from the 'Chabutra ' (platform), whereon there appeared to be some stains of blood. " Blood stained earth from the place where the dead body was recovered was also taken in possession. The two samples of earth so taken in possession were sent in different packets to the Chemical Examiner who found them stained with blood. The Serologist could not determine the nature of the blood due to disintegration. In vie* of this evidence, it cannot be said that no blood stained earth was found at the alleged spot. Further, Raziuddin, P.W. 17, who went with the armed guard to the spot stated; ",When at first I visited the house of Kali Charan I had noted that in front of his house there were indications of the washing of the ground at places. It appeared that somebody had removed things from that place with hands and legs by spreading water at different places. " This supports the statement of the other witnesses about the washing and plastering of the spot. Sub Inspector Basudeo, P.W. 27, stated that when he reached the house of Kali Charn at about 11 p.m., he noticed that outside it some water 786 appeared to be lying and at places it appeared that the ground had been washed with hand and water. It is true that the night was dark and he did not carry out the local inspection due to want of a suitable light. But these facts can hardily affect his testimony. He could not have mistaken the nature of the witness and should have been able to distinguish whether it was from water or from blood. The witness of the ground is not to be doubted even though about 8 hours had elapsed since the washing took place. Raziuddin has deposed that there had been rain fall two days earlier. The incident had taken place on the 28th of July. The ground could have been went from before and fresh washing could have wetted it more. In fact, the more the spilling of blood, the more would have been the water used to wash it away. Another circumstance urged is that no trail of blood was noticed between the village and the actual place where the dead body was recovered, a distance of over six miles. The corpse was laid on the planks of the cart. They got blood stained. Any dropping of the blood from the cart on the track would have depended on the extent of the flow of blood and on the openings between the planks. It is not expected that blood would have fallen in a continuous stream. Some drops could have fallen down at places. They could ' be easily pressed upon by the accused 's feet, some of whom would have been walking behind the cart. The armed guard and others who followed the cart in pursuit were more. concerned with the following of the marks left by the art than with noticing some minute drops of blood which might have fallen here and there on the track. Absence of blood on the passage, therefore cannot discredit the prosecution case. 787 When the cart was produced in Court, it had one of the bullocks used at the time when the corpse was removed and another bullock substituted for the other one. Much has been made of this change in the other bullock. The Sub Inspector has stated in his evidence. " I had entrusted the recovered bullocks and carts to the custody of Binda Lodhi of village Kharedi. One bullock which is white in colour could not be brought here as it is suffering from small pox. " The questions put to the accused mentioned the allegation about the other bullock suffering from small pox and in their replies this fact was not denied. The police was not, in charge of the cart and the bullock and explanation has been given for not producing the other bullock in Court. This circumstance too cannot therefore affect the correct ness of the prosecution case. It has also been urged that the carts and bullocks found near the dead body were not put up for identification by witnesses. Desai, J., has rightly observed that when witnesses could recognize the cart and bullocks there could be no point in having the cart and bullocks formally identified before a Magistrate. Only such articles and accused are put up for a test identification as are not known to the witnesses. Those known are never put up for identification. The statements of the witnesses who re cognized them are judged from other circumstances. Further, the evidence about the ownership of the cart was only by way of corroborating the statements of the prosecution witnesses. Any cart which could be available to the accused could be used for the purpose of transporting the dead body. Tijwa, P. W. 22, stated that Arjun Singh, accused, stopped the cart about a mile from the village abadi when he was returning home from his 788 fields and replaced the yoke of the cart with that of Tijwa 's as the former bad broken. It is urged that the absence of evidence with respect to what happened to the broken yoke and how the cart of Tijwa reached the village, important circumstances, had not been noticed by the High Court in its judgment. These circumstances cannot be said to be important. In fact, they were very remotely relevant to test the veracity of Tijwa. Tijwa was not cross examined about it. He stated that the broken yoke was also taken away in the cart of Arjun Singh. It should follow that Tijwa 's cart remained on the passage till its owner Mahadev Brahmin could have brought it back. It may be mentioned that the recovery memo, exhibit K. 22, did not mention about the finding of the broken yoke in the cart. The broken yoke is said to have been tied with a towel. It might have been that the accused had removed the towel and thrown away the broken pieces. The police party had no knowledge about the broken yoke when the cart was recovered and could not therefore have looked for the broken parts. It may equally be that the broken yoke was used by Tijwa. His cart had to go 'a much smaller distance that the cart which took the dead body to the nala. When the accused started with the cart they expected the broken yoke to serve the purpose of driving the cart to the nala and back. It was just accident that they happened to meet Tijwa on the way and borrowed his yoke. However, I consider these matters very insignificant in assessing the correctness of the prosecution case. Another matter severely commented upon for the appellants is the conduct of Sheo ' Sewak Singh, P. W. 20, Head Constable, Kharela Police Outpost, and the Investigating Officer, Basudeo, P. W. 27, mainly on account of the absence of entries in the duty register of the outpost about 789 Sheo Sewak Singh 's return there at about 4p.m., and about the Sub Inspector 's visit to it at about 11 p.m., on 28th July. The Sub Inspector has stated : "It is not necessary to make any arrival and departure (entry) at police out post Kharela, when I visit that post in the record, of that outpost." The statement is with reference to making an entry about his arrival and departure. He further stated: "I did not make any entry of my activities in the night between the 28th and 29th July 1957, in the record of police out post at Kharela nor it was necessary to note them there." And again: "Entries are made in the record at Kharela outpost about the duties allotted to the staff during duty hours." Sheo Sewak Singh, P.W.20, deposed: "I do make entries in the records at the police out post Kharela about my arrival there and also about my departure from that post. These entries are made in the general diary by way of allotment of duty." Sheo Nandan Singh, P.W.19, Constable at that outpost, stated: "This (Ex.K.5) is not a general diary in which cases are registered and entered. It is a register in which duties that are allotted and the Amad and Rawangi of the police staff are noted. When the Sub Inspector attached so Muskara comes to the police out post at Kharela 790 he notes his arrival and departure in the register kept at police outpost Kharela. No entry of his arrival and departure is made in the register in the night between the 28th and 29th of July 1957. " Police officers do write their arrivals and departures in the general diary at the police station and may also be doing so at the out post duty registers, if Sheo Nandan Singh 's statement is to be preferred to the statements of the Sub Inspector and the Head Constable. But even then such entries are usually made when the arrival of an outside police officer is in connection with some work at the out post. A casual visit on his way to another spot may not be required to be noted. Similarly, the return of a member of the police force at the out.post would be noted when he finally returns to duty. His mere return to his quarters at the out,post may not be noted. Any way, any omission to make an entry the duty register at the out post is not to discredit the entire prosecution evidence about the incident and the course of the investigation. After the recovery of the dead body, Sumera, Chowkidar, was sent to Police Station Charkhari, in whose jurisdiction the dead body was found. He lodged a report there at 3 a.m., and stated in it what had taken place earlier. Ram Autar Dixit, P.W.14, the then second officer at Thana Charkhari, went to the spot, took in possession the dead body and the cart, prepared the inquest report and took other necessary steps. Criticism. is made of Sumera 's being sent to Charkhari police station and of ' this Sub Inspector making an investigation in connection with an offence said to have been committed in the jurisdiction of police station Muskara. The criticism is unjustified. The recovery of the corpse had to be 791 reported to the nearest police station and was properly made at Charkhari Police Station in whose jurisdiction also the dead body was found. It was the duty of the Sub Inspector to proceed to the spot to prepare the inquest report and to take such other action as was necessary in the circumstances with respect to the recovery of the various articles (section 174 Cr. P.C.). He was not questioned about his bona fides or about his jurisdiction to do what he stated to have done. The fact that Sumera was sent to report the recovery of the dead body to police station Charkhari can hardly lead to the conclusion that this was done as no incident had taken place in village Kharela as alleged by the prosecution. Lastly, grievance is made of certain observations of Desai, J., generally to the effect that the accused had not stated something or had not led evidence to rebut the prosecution evidence on certain points. It is urged that be therefore wrongly placed on the accused the onus of proving the defence version negativing the prosecution version. I am of opinion that he made references to this as a factor supporting the conclusions hi) had already arrived at on the consideration of the evidence and circumstances. He did not base his findings on such conduct of the accused. He based his conclusion on more solid grounds. Some of such observa tions are : (1) 'That the accused gave no explanation as to how the blood came to be on the wall of the Chabutra '. The accused were not, questioned about it and therefore their omission to explain it could not go against them. However, the fact that blood was found on the wall of the platform or in the earth in front of Kali Charan 's house was proved from the positive evidence on record. 792 (2) After Desai, J. had expressed his opinion about the reliability of the eye witnesses, he stated : "Kharela is a large village and if the murder did not take place inside the abadi and at 3.30 p.m. it would not have been difficult for the appellants to produce reliable evidence to contradict the eye witnesses, but they did not produce any evidence . None of them said that Raja Ram Singh was not murdered in the abadi and in day time. If he was not murdered in the abadi and in day time they must have heard when and where he was murdered. Their statements were not evidence governed by the Evidence Act and they could say that what they bad heard. " I am of opinion that there is nothing wrong in this observation when the incident is alleged to have taken place in broad daylight in the village abadi and yet the accused did not examine any witness to establish that no such incident took place in the village. of course, a finding that the incident did take place in the village as alleged by the prosecution could not have been based on such consideration alone and the finding to that effect has not been so based. (3) Similarly, Desai, J., made reference to certain accused not stating as to whom the bullock. , ; .belonged and how they were obtained by the police. A finding about the ownership of the cart and bullocks is based on the evidence of Tijwa and other witnesses and not on the omission of the accused to state as to whom they belonged. Desai, J., was certainly wrong in using a note in the site plan when the subject matter of that note was not deposed to by any witness in Court, but this error with respect to the note that there were fresh marks of a cart in the cart enclosure of Dharam Singh had no significant bearing on the 793 In connection with Sumera 's Report at Police Station Charkhari, Desai, J., observed in his judgment : "Neither H.C. Sheo Sewak nor P.C. Raziuddin nor the armed guard had any interest in concocting a false case against the appellants on their own. Therefore, when the information was conveyed through Sumera Chaukidar that Kharela police had gone in search of the murderers, it must be accepted that information was received at the out post at about 3 45 p.m. about the murder in the Abadi and that the outpost police went at once in search of the murderers. In other words the murder must have been committed in the Abadi and in day time as deposed by the prosecution witnesses. " Earlier, Desai J., had said what Sumera had informed at the Police Station. He said: 'Sumera reached the police station at 3 a.m., met the second officer and informed him that constables of police circle Muskara went to his house in Jataura and told him that Raja Ram Singh was murdered, in Kharela, that the murderers carried away his corpse in a bullock cart and they and. the head constable of the out post followed them, that the murderers ran away after throwing the corpse into the nala of Jataura, that the head of the corpse was missing but the bullock cart had been recovered and that he was sent to convey the information at the police station. " I do Dot consider the evidence about Sumera 's making the report and stating certain things there to be inadmissible in evidence. These are matters of record. What he dictated cannot be considered to be substantive evidence of the facts stated, when 794 Sumera was not examined as a witness to prove them. But what he actually dictated and the time when he dictated are facts which 'have been duly proved. They can be considered to determine the probability of what the direct evidence tended to establish. This is what Desai J., did when he used these facts of his making the report and making certain statements in considering that they tend to support the prosecution version. It may be noted that he had earlier considered at length the suggestion that the entire prosecution case was concocted by the police and the villagers and bad given his reasons for repelling the suggestion. Desai J., was in error to refer to the absconding of the accused as a circumstance against them as that had not been put to them when examined under section 342, Cr. But as it did not basically affect the finding with respect to the correctness of the prosecution case, that would not justify interference with the findings of fact. I would therefore dismiss this appeal. By COURT. In View of the opinion of the majority, the appeal is allowed. The appellants are acquitted and must be released forthwith unless required in some other case.

The appellants were convicted of offences under section 302 read with section 34 and section 201 read with section 34 Indian Penal Code by the Sessions judge. On appeal to the High Court there was a difference of opinion between the two judges who heard it and the case was referred under section 429 Code of Criminal Procedure to a third judge. The third judge upheld the con victions. The appellants contended that where a case was referred under section 429, the opinion of the judge acquitting the accused had to be treated as a judgment of acquittal and that the third judge must consider all the reasons given by the acquitting judge and his judgment should indicate the reasons for disagreeing with the opinion of the acquitting judge. The appellants further contended that there were certain circumstances proved by the evidence on the record which showed that the eye witnesses could not be relied upon. Held, that there was nothing in section 429 which required the third judge to whom the reference was made to act as though he was sitting in appeal against acquittal. He had to consider the opinion of the two differing judges and to give his own opinion. Held, further (per Kapur and Das Gupta JJ. Dayal. J. contra) that the judgment of the High Court suffered from such infirmities as placing the onus of proof of certain facts on the appellants and using of inadmissible evidence. The case was full of so many inconsistencies and improbilities and peculiarities that it made it difficult to rely upon the testimony of the eye witnesses and to hold that the case against the appellants was established beyond reasonable doubt. Per Dayal J. The circumstances urged by the appellant did not make out a case for interference with the findings of facts of the High Court.

Civil Appeal No.4094 of 1984. From the Judgment and order dated 9.7.1984 of the Punjab & Haryana High Court in Civil Writ Petition No.5371 of 1981. P.P. Rao, Sr. and Janendra lal for the appellants. S.C. Gupta, Rajinder Sachhar, Sudarshan Goyal, Vivek Bhandari, S.C.Patel, mahabir Singh and C.M. Nayar (NP) for the Respondents. The Judgment of the Court was delivered by K.RAMASWAMY, J. The appellants and the proforma respondents, thirty in number are employed in the Punjab Service of Engineers, Class II. The Governor, in exercise of the power under proviso to article 309 of the Constitution of India framed the Punjab Service of Engineers, Class I, P.W.D. (Road and Buildings) Rules. 1960 for short the Rules constituting the Punjab Service of 204 Engineers, Class I, P.W.D. (Roads and Buildings Branch), After the formation of State of Haryana w.e.f. November 1, 1966, the rules are called Haryana Service of Engineers, Class I, P.W.D. (Roads and Buildings Branch). The services consist of Asstt. Executive Engineers, Executive Engineers, Superintending Engineers, and Chief Engineers, as may be specified by the Government of Haryana from time to time (Rule 3(1). The recruitment to the service is made by the government as per Rule 5(1); (a) by direct recruitment; (b) by transfer from any other services of the State Govt. or of the Union of India; and (c) by promotion from Haryana Engineers, Class II Service. The appellants for short 'the promotees" from Class II Service were promoted as Executive Engineers by relaxing five years length of service as Class II Engineers in officiating capacity on various dates between January 6, 1969 to May 29, 1971, There of them, namely, A.N. Sehgal, Raj Kumar and H.C. Sethi were confirmed as Executive Engineers w.e.f. July 11, 1973, December 11, 1974 and December 9, 1975 respectively. The rest are yet to be confirmed. Raje Ram Sheoran was recruited and appointed directly as Asstt. Executive Engineer w.e.f October 25, 1971. He too was given relaxation of the length of service of five years as Asstt. Executive Engineer and was promoted as Executive Engineer on October 8, 1973. He was confirmed w.e.f. December 22, 1976. All the appellants except M.R. Gupta were further promoted as Superintending Engineers on different dates between 1980 to 1984 and Mr. Sheoran was promoted as Superintending Engineer on March 4, 1987 A.N. Sehgal was further promoted as Chief Engineer, Equally Mr. Sheoran was also promoted as Chief Engineer but the validity was challenged and it is not necessary to refer any further as it is subject matter of proceedings in the High Court. R.R. Sheoran who was shown junior to the appellants, field Writ Petition No. 5371/81 and sought a writ of mandamus directing the second respondent, State Government to consider his case for promotion as Superintending Engineer from the date on which the respondents were promoted; to quash the gradation list; to assign the seniority over the appellants and the consequential reliefs. On reference, a Division Bench of the High Court by its judgement dated July 9, 1984 agreed with the ratio laid down in M.S. Mighlani vs State of haryana & Anr., [1983] 1 S.L.R. 421 and held that R.R. Sheoran was a member of the service from the date of his initial appointment as Asstt. Executive Engineer and the appellants and the proforma respondents are not members of the service and directed the learned Single Judge to dispose of th matter on merit. This appeal on leave arises against the judgement of the Division Bench. 205 The controversy centres round the inter se seniority of the appellants and R.R. Sheoran. For its determination the Rules need interpretation. The counsel for parties agreed that we should decide the principles on consideration of the Rules and leave the matter for the State Govt. to determine the inter se seniority by applying the law, so for as the controversy relating to relaxation of the length of service is concerned it is set at rest by this Court in J.C. Yadav vs State of Haryana, and K.K. Khosla V. State of Haryana, [1990] 2 SCC 199 by a bench of three Judges to which one of us (K.N. Singh, J.) was a member. The only question which survives is as to when `the appellants ' and `R.R. sheoran ' become members of the respective services. Shri P.P.Rao, learned Senior Counsel for the appellants contends that the appellants were promoted as Executive Engineers against regular vacancies, which were neither a stop gap arrangement nor fortuitous, and they continued in service without any break from the respective dates of their promotion, therefore, they are members of the service in a substantive capacity as Executive Engineers from the respective dates of promotion. He further argued that since Raje Ram Sheoran was recruited as Asstt. Executive Engineer w.e.f. August 30, 1971 along after the promotion of the appellants upto B.L. Goyal, the appellants are senior to R.R. Sheoran as Executive Engineers. Proviso to Rule 5(2) entitles them to remain in a substantive capacity as Executive Engineers since requisite number of qualified Asstt. Executive Engineers were not available for promotion. In view of their continous officiation as Executive Engineers in terms of Rule 2(12)(a) of the rules, they must be deemed to be the members of the service from the dates of promotion and, therefore, they are seniors to R.R.Sheoran . M/s. Sachhar, learned counsel for the State and Gupta for R.R. Sheoran on the other hand contended that unless the appellants were appointed substantively to the cadre posts they could not be members of the service. R.R. Sheoran became member of the service from the date of his initial appointment as Asstt. Executive Engineer, therefore, he is senior to the appellants and proforma respondents and the High Court rightly interpreted rule 5(2). Since the High Court did not enter into the merits of the respective claims of the appellants and Sheoran, we express no opinion on merits except, as agreed by the parties, we declare the law on the interpretation of the rules and leave it to the State Govt. to decide the inter se seniority on merits. It is necessary to have a look into the Rules regulating the 206 service. Rule 3(1) postulates that the service shall comprise of Assistant Executive Engineers, Executive Engineers, Superintending Engineers and Chief Engineers. Rule 3(2) read with appendix `A ' enjoins the State of Haryana to determine the cadre strength of service each year. Appendix `A ' lays down procedure to determine the cadre strength of service. The senior posts include Executive Engineers and above while junior scale posts include Asst. Executive Engineers . Ex cadre posts also are contemplated in the respective senior posts and junior scale posts. Rule 5(1)(a) posits recruitment to the service: (a) by direct recruitment; (b) by transfer and (c) by promotion from Class II service. Sub rule (4) of Rule 5 says that all direct appointments to the service shall be to the post of Asstt. Executive Engineer. Proviso therein gives power to the government to appoint by direct recruitment as Executive Engineers, in exceptional circumstances, for reasons to be recorded in writing. Rules 6 and 7 prescribe qualifications and method of appointment by direct recruitment . Subrule (3) of Rule 7 states that appointment to the service shall be made according to the number of vacancies to be filled by direct recruitment strictly in the order of merit as indicated by the Public Service Commission. As per Rule 11(1) and direct recruit shall remain on probation for a period of two years or extended period upto maximum of three years. On satisfactory completion of probation, the government may confirm under clause (a) of sub rule (3) of Rule 11 or to discharge him from service otherwise. The post of Asstt. Executive Engineer is a junior scale post. Under rule 12(3), they year of allotment of an Asstt. Executive Engineer shall be the calendar year in which the order of appointment is issued by the government. Rule 2(1) defines appointment to the service which includes an appointment made according to the terms and provisions of the rules to an officiating vacancy or to an ex cadre post provided that an officer so appointed shall not be deemed to have become a member of the service as defined in Clause (12) of Rule 2. The Asstt. Executive Engineer means a member of the service in the junior scale of pay, (Rule 2(2)). Cadre post means permanent post in the service as per Rule 2(3). `Class II Service ' means the Punjab Service of Engineers, Class II, in the Buildings and Roads Branch and includes, for purposes of promotion to and fixation of seniority in the Class I Service, Temporary Asstt. engineers when a suitable Class II Officer is not available vide Rule 2(5). Direct appointment means an appointment by open competition but does not include (a) an appointment made by promotion; (b) an appointment by transfer of an officer from the service of the State Government or of the Union, (Rule 2(7). Ex cadre 207 post means a temporary post of the same rank as a cadre post vide Rule 2(10). A member of the service means an officer appointed sub stantively to a cadre post and includes (a) in the case of a direct appointment an officer on probation, or such an officer who, having successfully completed his probation, awaits appointment to a cadre post vide Rule 2(12)(a). A reading of the rules clearly indicates that an Asstt. Executive Engineer appointment by open competition to a substantive vacancy in a cadre post and put on probation is a member of the service. Equally such Asstt. Executive Engineer recruited by open competition and appointment to an ex cadre post and put on probation and who having successfully completed his probation and awaits appointment to a cadre post would also become a member of the service. The contention of Shri P.P.Rao is that an officer appointed substantively to a cadre post is a direct recruit and the inclusive definition encompasses within its ambit the promotee and the phase ``such an officer who having successfully completed his probation and awaits appointment to the cadre post ' ' is only referable to a promotee. So promotee is also a member of the service from the date of initial promotion. We may make it clear at this juncture that in normal service jurisprudence a direct recruit would always be recruited and appointed to a substantive vacancy and from the date he starts discharging the duty attached to the post he is a member of the service subject to his successfully completing the probation and declaration thereof at a later date and his appointment relates back to the date of initial appointment, subject to his being discharge from service on failure to complete the probation within or extended period or termination of the service according to rules. Equally it is settle law that a promotee would have initial officiating promotion to a temporary vacancy or substantive vacancy and on successful completion and declaration of the probation, unless reverted to lower posts, he awaits appointment to a substantive vacancy. Only on appointment to a substantive vacancy he become a member of the service. But confirmation and appointment to a substantive vacancy always an inglorious uncertainty and would take unduly long time. Therefore, the confirmation or appointment to a substantive capacity would not normally be a condition precedent to reckon the continuous length of service for the purpose of seniority. On the facts of the case and the settled legal position, at first blush the argument of Shri P.P.Rao carried weight that the appellants would get their seniority from the respective dates of the initial promotion as Executive Engineers. But we find that in the instant case the rules have made departure from the normal service jurisprudence as would 208 appear from the scheme under the rules. Para 11(b) of appendix `A ' read with Rule 3(2), while determining the cadre strength of the service, adumbrates creation and appointment of Asstt. Executive Engineers (direct recruit) to an ex cadre junior scale post in each year. Therefore in a given situation, a direct recruit appointed to an ex cadre post, cannot be kept in lurch until he is appointed to a cadre post so as to become a member of the service. Obviously to avoid such a hiatus, Rule 2(12)(a) was introduced. The main part o Rule 2(12)(a) declares that an appointee substantively to a cadre post i.e., permanent post is a member of the service. The inclusive definition brings an officer `by direct appointment on probation ' who having successfully completed probation and awaits appointment to a cadre post is also a member of the service. Take for instance if direct recruitment is made to fill in five posts of Asstt. Executive Engineers of which four are cadre posts and one ex cadre post and four persons are appointed to cadre posts in the order of merit and the last one to the ex cadre post. The first four officers appointed on probation to the substantive vacancies and they are covered by the main part of Rule 2(12)(a). The fifth one intended to cover the field of operation of the inclusive definition which says that `and also includes an officer directly appointed on probation ' `and such an officer who having successfully completed his probation, awaits appointment to a cadre post '. The words `and such an officer ' `directly appointed ' would obviously referable to an Asstt. Executive Engineer directly appointed to an ex cadre post; who may be placed on probation and awaits appointment to a cadre post. By operation of the definition clause he also becomes the member of the service from the date of initial appointment. This view is further fortified by the definition the `appointment to the service ' in Rule 2(1) which says that appointment to the service includes an appointment made according to the terms and provisions of these rules to an officiating vacancy or to an ex cadre post. Rule 2(7) says that direct appointment means appointment by open competition but excludes `promotee ' or `transferee '. So a promotee promoted to an officiating vacancy or on ex cadre post does not become member of the service unless he is appointed substantively to a cadre post. We, therefore, hold that a direct recruit appointed to an ex cadre post alone is a member of the service even while on probation and Rule 2(12)(a) applies to them and it does not apply to promotee from Class II service. An Asstt. Executive Engineer, on putting five years of service under rule 9(3)(a) and passing the department examination as 209 required under rule (15), (unless the qualifications are relaxed in exercise of the power under rule (22) of the rules) becomes eligible for promotion as Executive Engineer. The State Govt. had relaxed the required length of five years service of the promotees as well as direct recruits. R.R.Sheoran therefor became eligible to be considered for promotion. As per the procedure prescribed in this regard under rule 9(2), he was found fit and suitable and was promoted as an Executive Engineer w.e.f. October 8, 1973. Though M/s. Sachhar and Gupta contended that the direct recruit need not undergo the required probation ad Executive Engineer, we find no force in the contention. The normal channel of appointment to the post of Executive Engineer, a senior post, is by way of promotion to which a direct recruit Asstt. Executive Engineer is entitled to be considered. On promotion he shall be on probation for a period of one year as per Rule 11(1)(a), but the period spent on officiation as Executive Engineer shall be taken into account for purposes of completing the period of probation and on its successful completion, he shall remain in service As Executive Engineer. On a conjoint reading of Rule 12(3) and 12(5) it is clear that the year of allotment of the Asstt. Executive engineer in the post of Executive Engineer, shall be the calendar year in which th order of appointment as Asstt. Executive Engineer had been made. Thus his seniority as Executive engineer, by fiction of law, would relate back to his date of initial appointment as Asstt. Executive Engineer and in Juxta position to Class II officers ' seniority as Executive Engineer is unalterable. The date of the seniority of Mr. R.R.Sheoran 1971. The question then is what is the date from which the seniority of a promotee as Executive Engineer shall be reckoned? The contention of Shri P.P. Rao is that Rule 5(2) reserve 50% of the posts to the direct recruits but the proviso thereto makes a built in relaxation, namely, so long as the required number of direct recruits are not available to occupy those posts, the promotees are entitled to hold those posts also. Admittedly except R.R. Sheoran no other direct recruit was available. The promotees are eligible to occupy all the cadre posts even in excess of their quota. The seniority has to be determined from the respective dates of initial officiating promotion. Shri Rao ' further contention that the phrase `such an officer appointed to an officiating post ' has reference only to promotees cannot be accepted for the reasons given earlier. The officer appointed directly is referable only to Asstt. Executive Engineer and a promotee by operation of Rules 2(7) stands excluded until he is appointed substantively to a cadre post. 210 When an officer is appointed substantively to a cadre post, is the next question. It is settled law that all the rules should be harmoniously construed giving life, force and effect to every part of the rule of clause or word so that no part would be rendered redundant, ineffectual, nugatory or otiose. Rule 5(1) regulates recruitment to the service from three sources, namely, direct recruitment; by transfer and by promotion from Class II service. Sub rule (2) thereof prescribes the ratio between the promotees and others. It says that, "recruitment to the service shall be so regulated that the number of posts so filled by promotion from Class II service shall not exceed 50%" of the number of posts in the service excluding the posts of Asstt. Executive Engineers; provided that till such time the adequate number of Asstt. Executive Engineers who ar eligible and considered fit for promotion are available, the actual percentage of officers promoted from Class II service `may be larger than 50%. A reading thereof clearly manifests the legislative animation, namely, that the promotees from Class II service shall not exceed 50% of the posts in the service. The word `shall ' indicates that it is mandatory that the remaining 50% shall be kept open only to the Asstt. Executive Engineers who were directly recruited but later were found eligible and fit for promotion as Executive Engineers. Therefore, unless the government resorts exceptionally with prior permission of Public Service Commission, vide Rule 10 to recruitment by transfer of an officer from other service of the State Govt. or of the Union, the remaining 50% of the posts as Executive Engineers, Superintending Engineers and Chief Engineers shall be occupied only by the direct recruit Asstt. Executive Engineers. It is settled law that prescription of quota for recruitment from different sources is constitutionally a valid rule. Rule 5(2) limits 50% posts to the promotees from Class II Service and no further, but the proviso to the Rule lays down that till adequate number of Asstt. Executive Engineers are available, the rigour of 50% quota may be relaxed and Class II officers may be promoted in excess of their quota. What is the intendment of the class `the actual percentage of officers promoted from Class II service may be larger than 50% is the question. The mandate of Rule 5(2) is that the officers promoted from Class II service shall in no case exceed 50% of the number of posts in the service. Unless it is relaxed, the appointment and occupation of the posts by promotee in excess thereof is irregular or illegal and the government have no power to promote persons from Class II service to fill in such posts of Executive Engineers Superintending Engineers and Chief Engineers. It is common knowledge that direct recruitment as Asstt. Executive Engineers 211 or Executive Engineer; in exceptional circumstances is a tardy process and even after appointment they have to put in five years service. The balance 50% of the posts cannot be kept vacant. With a view to allow the wheels of the administration moving, the proviso carves out an exception and allows the promotees to occupy temporarily the posts in excess of their quota. In this view the contention of Shri Rao that the seniority as Executive Engineer is to be counted from the date of initial temporary promotion cannot be accepted as it would allow the promotees to occupy 100% posts of Executive Engineers, Superintending Engineers and Chief Engineers leaving little room for Rule 5(2) (a) to operate in full force. The exception would eat away the flesh and blood of Rule 5(2)(a) freezing the channel of promotion to the direct recruits to senior posts for a very long time to come. In the absence of rule of rotation there may be no chance to a direct recruits to occupy the senior posts. That does not appear to be the intendment, scope and operation of the proviso. The intendment appears to be that so long as the direct recruit Asstt. Executive Engineer, eligible and considered fit for promotion is not available, the promotee from Class II service in excess of the quota is eligible to occupy on officiating capacity the senior posts, i.e., Executive Engineers and above. The moment direct recruits are available, they alone are entitled to occupy 50% of their quota and the promotees shall give place to the direct recruits. It is a cardinal rule of interpretation that a proviso to a particular provision of a statute only embraces the field which is covered by the main provision. It carves out an exception to the main provision to which it has been enacted by the proviso and to no other. The proper function of a proviso is to except and deal with a cause which would otherwise fall within the general language of the main enactment, and its effect is to confine to that case. Where the language of the main enactment is explicit and unambiguous, the proviso can have no repercussion on the interpretation of the main enactment, so as to exclude from it, by implication what clearly falls within its express terms. The scope of the proviso, therefore, is to carve out an exception to the main enactment and it excludes something which otherwise would have been within the rule. It has to operate in the same field and if the language of the main enactment is clear, the proviso cannot be torn apart from the main enactment nor can it he used to nullify by implication what the enactment clearly says nor set at naught the real object of the main enactment, unless the words of the proviso are such 212 that it is its necessary effect. In V.B. Badami, etc. vs State of Mysore, [1976] 1SCR 815 dealing with the problem arising out of quota rule between promotees, this Court observed that: "In working out the quota rule, these principles are generally followed. First, where rules prescribe quota between direct recruits and promotees, confirmation or substantive appointment can only be in respect of clear vacancies in the permanent strength of the cadre. Second, confirmed persons are senior to those who are officiating. Third, as between persons appointed in officiating capacity, seniority is to be counted on the length of continuous service. Fourth, direct recruitment is possible only by competitive examination which is prescribed procedure under the rules. In promotional vacancies, the promotion is either by selection or on the principle of seniority cum merit, a promotion could be made in respect of a temporary post or for a specified period but a direct recruitment has generally to be made only in respect of clear permanent vacancy either existing or anticipated to arise at or about the period of probation is expected to be completed. Fifth, if promotions ar made to vacancies in excess of the promotional quota, the promotions may not be totally illegal but would be irregular. The promotees cannot claim any right to hold the promotional posts unless the vacancies fall within their quota. If the promotees occupy any vacancies which are within the quota of direct recruits, when direct recruitment takes place the direct recruits will occupy vacancies within their quota. Promotees who were occupying the vacancies within the quota of direct recruits will either be reverted or they will be absorbed in the vacancies within their quota in the facts and circumstances of a case". With a view to have efficient and dedicated services accountable to proper implementation of Govt. policies, it is open, and is constitutionally permissible for the State, to infuse into the services, both talented fresh blood imbued with constitutional commitments, enthusiasm, drive and initiative by direct recruitment, blended with matured wealth of experience from the subordinate services. It is permissible to constitute an integrated service of persons recruited from two or more sources, namely, direct recruitment, promotion from subordinate 213 service or transfer from other services, Promotee from subordinate generally would get few chances of promotion to higher echolans of services. Avenues and facilities for promotion to the higher services to the less privileged members of the subordinate service would inculcate in them dedication to excel their latent capabilities to man the cadre posts. Talent is not the privilege of few but equal avenues made available would explore common man 's capabilities overcoming environmental adversity and open up full opportunities to develop one 's capabilities to shoulder higher responsibilities without succumbing to despondence. Equally talented young men/women of great promise would enter into service by direct recruitment when chances of promotions are attractive. The aspiration to reach higher echolans of service would thus enthuse a member to dedicate honestly and diligently to exhibit competence, straightforwardness with missionary zeal exercising effective control and supervision in the implementation of the programmes. The chances of promotion would also enable a promotee to imbue involvement in the performance of the duties; obviate frustration and eliminate proclivity to corrupt practices, lest one would tend to become corrupt, sloven and mediocre and a dead wood. In other words, equal opportunity would harness the human resources to augment the efficiency of the service and under emphasis on either would upset the scales of equality germinating the seeds of degeneration. With a view to achieve this objective, the rule making authority envisaged to appoint direct recruits as well as by promotion from Class II Service, otherwise by transfer from other services. In interpreting the rules, effect must be given to allow everyone drawn from these sources to have their due share in the service and chances of involvement of effectively discharge the duties of the posts honestly and efficiently with dedication. Any wanton or deliberate deviation in the implementation of the rules should be curbed and snubbed and the rules must be strictly implemented to achieve the above purpose. If wanton deviations are allowed to be repeated, it would breed indiscipline among the service and amounts to undue favour to some and denial of equality for many for reasons known or unknown subverting the purpose of the rules. It is settled law that appointment to a post in accordance with the rules is condition precedent and no one can claim appointment to a post or promotion, as of right, but has a right to be considered in accordance with the rules. Appointment by promotion or direct recruitment, therefore, must be in accordance with the rules so as to 214 become a member of the service in a substantive capacity. Seniority is to be fixed in accordance with the principles laid down in the rules. Rule 8 prescribes procedure for appointment by promotion from Class II services. Rule 9(2) states that promotion would be made by selection on the basis of merit and suitability in all respect and no member of the service shall have any claim, to such promotion as a matter of right by mere seniority. The committee as constituted under Rule 8 shall prepare the list of officers considered fit for promotion in the order of merit and on approval by the public Service Commission, the State Govt. shall appoint the persons from the list in the order in which the names have been placed by the Commission, Appointment by promotion may be made under Rule 8(12) to an excadre post or to any post in the cadre in an officiating capacity from the list prepared as aforesaid. On promotion, as per Rule 11(1), officer shall be on probation for a period of one year, but if the officer had been officiating as an Executive Engineer the period of officiation would be counted towards probation. Rule 11(4) provides the on satisfactory completion of the probationary period, the Govt. confirms the officiating promotee and "appoint him in a substantive capacity on a cadre post provided the post is available to him". If no cadre post is available, the officer has to wait for an appointment to the cadre post. A promotee within quota under rule 5(2) gets his seniority from the initial date of his promotion and the year of allotment, as contemplated in Rule 12(6) shall be the next below "the junior most officer in the service whether officiating or confirmed as Executive Engineer before the former 's appointment ' counting the entire officiating period towards seniority, unless there is break in the service or from the date of later promotion. Such promotee, by necessary implication, would normally become senior to the direct recruit promoted later. Combined operation of sub rules (3) to (5) of Rule 12 makes the direct recruit a member of the service of Executive Engineer from the date of year of allotment as an Asstt. Executive Engineer. The result is that the promotee occupying the posts within 50% quota of the direct recruits, acquired no right to the post and should yield to direct recruit though promoted later to him, to the senior scale posts i.e., Executive Engineer, Superintending Engineer and Chief Engineer. The promotee has right to confirmation in the cadre post as per Rule 11(4) if a post is available to him within his quota or at a later date under rule 5(2) read with 11(4) and gets appointment under section 8(11). His seniority would be reckoned only from the date of the date of the availability of the post and the year of allotment, he shall be next below to his immediate 215 senior promotee of that year or the junior most of the previous year of allotment whether officiating or permanent occupying the post within 50% quota. The officiating period of the promotee between the dates of initial promotion and the date of the availability of the cadre post would thus be rendered fortuitous and stands excluded. A direct recruit on promotion within his quota, though later to the promotee is interposed in between the periods and interjects the promotee 's seniority; shaps the links in the chain of continuity and steals a march over the approved promotee probationer. Harmonious construction of rule 2(1), 2(3), 2(7), 2(10), 2(12),(a) 5(2)(a), 8,9(2), 11, 12(3), 12(5) to 12(7) would yield to the above result, lest the legislative animation would be defeated and the rules would be rendered otiose and surpluses. It would also adversely effect the morale and efficiency of the service. Mere officiating appointment by promotion to a cadre post outside the quota; continuous officiation therein and declaration of probation would not clothe the promotee with any right to claim seniority over the direct recruits. The necessary conclusion would, therefore, be that the direct recruit shall get his seniority with effect from the date of the year of the allotment as Asstt. Executive Engineer which is not alterable. Whereas the promotee would get his seniority w.e.f. the date of the availability of the posts within 50% quota of the promotees. The year of allotment is variable and the seniority shall be reckoned accordingly. Appointment to the cadre post substantively and confirmation thereof shall be made under rule 8(11) read with Rule 11(4) of the rules. A promotee Executive Engineer would only then become member of the service, `Appointed substantively ' within the meaning of Rule 2(12) (a) shall be construed accordingly. We, further hold that the seniority of the promotee from Class II service as Executive Engineer shall be determined with effect from the date of which the cadre post was available to him and the seniority shall be determined accordingly. In K.C.Joshi & Ors. etc. vs Union of India & Ors., [1990]2 Scale 951 a Bench of three Judges to which one of us (K. Ramaswamy, J.) was a member, considered similar question. In that case U.P. Forest Service Rules, 1952 provides, two sources of recruitment to the post of Asstt. Conservators of Forest. The petitioners therein were Forest Range Officers in U.P. Forest Subordinate Service. The respondents were direct recruits as Asstt. Conservators of Forest. The rules prescribed ratio between direct recruits and promotees. Due to delay in recruitment as Asstt. Conservators of Forest, the Forest Rangers were promoted in excess of their quota as Asstt. Conservators of Forest temporarily and continued in service without any break for 5 to 12 216 years. The promotees claimed seniority from the date of their initial promotion. Considering the scope of the rules and rights acquired by the petitioners therein and the direct recruits, the Court held that: "When promotion was outside the quota, the seniority would be reckoned from the date of the vacancy within the quota, rendering the pervious service fortuitous. The previous promotion would be regular only from the date of the vacancy within the quota and seniority shall be counted from that date and not from the date of his earlier promotion or subsequent confirmation. In order to do justice to the promotees it would not be proper to do injustice to the direct recruits. The rule of quota being a statutory one must be strictly implemented and it is impermissible for the authorities concerned to deviate from the rule due to administrative exigencies of expediency. The result of punishing down the promotees appointed in excess of the quota may work hardship but it is unavoidable and any construction otherwise would be illegal, nullifying the force of statutory rules and would offend articles 14 & 16(1). Therefore, the rules must be carefully applied in such a manner as not to violate the rules or equality assured under article 14 of the Constitution. This Court interpreted that equity is an integral part of article 14. So every attempt would be made to minimise, as far as possible inequity. Disparity is inherent in the system of working out integration of the employees drawn from different sources, who have legitimate aspiration to reach higher echolans of service. A feeling of hardship to one, or heart burning to either would be avoided. At the same time equality is accorded to all the employees". Shri P.P. Rao urged that the cadre posts in Rule 2(12) must include not only the permanent posts but also temporary posts continued for more than three years and notional posts which may have existed for short spells during preceding three years taking into account the number of months and days for which each post had existed as per the formula prescribed in appendix `A ' read with Rule 3 of the rules. He further urged that the promotees appointed to such posts should be treated to be `members of the service ' interms of Rule 2(12)(a) and that their promotion should be retrospectively declared to have been promoted w.e.f. the dates on which the posts were created. We are unable to accept this contention. Rule 3 read with 217 appendix `A ' confers power and also imposes duty on the State Govt. to determine the cadre posts from time to time and in the first five years on the first day of each year. This exercise should be done in the light of the criteria prescribed in appendix `A '. The present controversy does not concern itself with the method and manner of determination of th cadre posts, though determination of seniority hinge upon it. Therefore, for determining seniority, the State Govt. should undertake the exercise interms of Rule 3 read with appendix `A '. The rules postulate that substantive appointment to a cadre post is a condition precedent to become a member of the service. A class II officer shall be promoted to a temporary post or in an officiating capacity to a cadre post if vacancy exist ' when he occupies a vacancy in a substantive post and continued uninterruptedly it would be open to the appointing authority to put the promotee Executive Engineer on probation. Though confirmation is an inglorious uncertainty depending neither on the efficiency of the officer nor generally on the availability of the post, the mandate of Quota of 50% in Rule 5(2) should be adhered to. Declaration of probation and confirmation to a cadre post, if available, under Rule 11(4) shall be made. Seniority of such approved or confirmed promotee should be counted from the date of either initial officiating promotion of continous later officiation from the date of availability of the cadre post, however, should be next below his senior promotee or the junior most of the preceding year of allotment within the quota. If no post is available till such date of the availability, the entire period of continuous officiation would be rendered fortuitous. The contention, therefore, that the promotion would relate back retrospectively to the date of creation of the post and the appointment to the vacancy shall be with reference to the date of the creation of the post, would result anomalies and render Rule 5(2) to the direct recruits surplusage. Shri P.P. Rao 's further contention that the de facto promotion and the retrospective declaration of cadre post would make the Class II officers as de jure members of the service from the very date of temporary appointment w.e.f. the date of initial appointment also lacks force for the same reasons. The principles laid down in R.P. Khanna vs S.A.F. Abbas & Ors., [1973]3 SCR. 548 at 557 C J . is not applicable to the facts of this case. In that case the certain posts in State services were required to be declared as senior cadre posts in the All India Service, but before such declaration could be made some of the promotee officers officiated in the senior cadre post. In that context the Court observed that 1the promotee could not get the benefit of officiation unless the post was declared a equivalent to a senior cadre 218 post before the promotee was appointed; to officiate him would defeat the policy of the government ' and held that they are entitled to the benefit of the retrospective declaration `in the absence of things practical as well as reasonable. The scheme of the rules made a definite departure to the normal service jurisprudence and the operation of the scheme in the rules must be given full effect. In the instant case under the Rules `determination of seniority would be ' made only after the promotee becomes a member of the service. Therefore, the year of allotment must be determined having regard to (i) availability of the cadre post within quota; (ii) satisfactory completion of the probation; and (iii) appointment to the post in the substantive capacity in term of Rules 12(6) and (7) read with 11(4) and Rule 8(12). Any other construction would be contrary to the avowed object of the rules as a whole. The inclusive definition of Rule 2(12) (a) must be interpreted liberally and not restrictively. Undoubtedly the inclusive definition always receives liberal interpretation to bring within its ambit cognate but unforeseen similes. But the rules envisage only three sources of recruitment, namely, direct recruitment, appointment by promotion and in exceptional cases with prior approval of the Public Service Commission as per Rule 10, the appointment by transfer from other services of the State or Central Govt. Until the ex cadre posts are declared to be cadre posts they remain ex cadre posts. The promotion to the ex cadre post is temporary or to a cadre post could be only on officiating basis. It may be open to the government to abolish at any time the ex cadre posts. Determination of cadre strength is a condition precedent for Rule 5(2)(a) to operate. Till a promotee is confirmed in a substantive capacity as Executive Engineer, he continues to retain line in Class II service. The interpretation that the promotion to the temporary post or ex cadre post within the meaning of Rule 2(10) should also be deemed to be an appointment to a substantive post would do violence to the language of the relevant rules and the scheme. It is true that this Court in Baleshwar Dass & Ors. vs State of U.P. & Ors. , [1981] 1 SCR 449 at 463 held that there cannot be probation for a government servant who is not to be absorbed substantively in the service on completion. The ratio therein does not apply to the facts of this case for the reason that the Govt. itself did not understand the scope and operation of the rules properly as is amply demonstrated from their mutually irreconcilable inconsistent stand taken in the counter affidavits filed by the State Govt. in the High Court and in this Court. That apart, it would appear that in the instant case after the formation of the State of Haryana, adequate number of officers were 219 not available to hold the posts. The length of service and passing of prescribed tests were relaxed enmass. In view of the above peculiar and special facts merely because the promotee Class II Officers were put on probation and the same was declared it does not clothe them with any right to deemed appointment to substantive vacancies in excess of their quota with retrospective effect from the date of initial promotion to the cadre posts. The year of allotment of a direct recruit is always the year in which he is appointed to the junior scale post of Asstt. Executive Engineer but the year of allotment to the promotee is variable depending on the availability of the cadre post within quota of 50% and subject to taking the seniority next below the junior most promotee of the preceding year of allotment or immediate senior of the same year. If the contention of Shri P.P. Rao is accepted is accepted it would render Rule 8(11) mutually inconsistent with Rule 5(2w) read with Rules 2(7) and 2(12) and Rule 2(1). No countenance could be given to the contention that the officers put on probation in terms of Rule 11(1) irrespective whether they occupied declared posts, but also posts which ought to have been declared as such from time to time and have continuously remained in service entitle them to become member of service and that, as and when the posts occupied by them are declared as cadre posts with retrospective effect, they are entitled to be treated as members of the service w.e.f. the due dates. In other words it amounts to put a premium on the inaction on the part of the State Govt. to declare the cadre posts in terms of Rule 3(2) read with appendix `A ' defeating the scheme of the Rules. The contention that our interpretation renders Rule 2(12) arbitrary and discriminatory violating articles 14 and 16 is also not tenable. A direct recruit, by operation of Rule 2(12) (a) read with Rules 2(1) and 2(10), though appointed to an ex cadre post, by fiction of law, becomes a member of the service from the date of his initial appointment since being a fresh recruit. On his satisfactory completion of the prohibition and on availability of the cadre post as Asstt. Executive Engineer, he becomes a confirmed Asstt. Executive Engineer. While a promotee Executive Engineer continues to retain his line on the posts as Class II officers still he is appointed substantively to Class I service. There is reasonable classification and discernable distinction drawn between the direct recruit and the promotee. The nexus is to treat direct recruit Asstt. Executive Engineer appointed to the cadre posts as well as ex cadre post at par as members of the service and the deeming clause is to serve this purpose. Thus, there is nether invidious discrimination nor arbitrariness in Rule 2(12)(a) offending articles 12 & 16. The differentiation drawn between direct recruit and the 220 promotee bears rational relation to the object of Rule 2(12), the ratio of the Constitution Bench in B.S. Yadav vs State of Haryana, and The Direct Recruit, Class II Engineering Officers ' Association vs State of Maharashtra & Ors., ; at 745 cannot be imported bodily and applies to the ficts of the case in the light of the operation of the rules in question. The further contention that Rule 12 adumbrates that not only a member of the service, but even an officer officiating as an Executive Engineer before becoming a member of the service is entitled to an year of allotment because the rules nowhere say that only members of service are entitled to year of allotment is devoid of substance. As already discussed a promotee cannot be given year of allotment, before he becomes a member of the service and his seniority cannot be fixed arbitrarily with reference to the date of his initial promotion to an ex cadre post or continuous officiating in a cadre post without break, as the case may be. We accordingly, direct the Government of Haryana to determine the cadre posts, if not already done, regularly from time to time including the post created due to exigencies of service in terms of Rule 3(2) read with appendix `A ' and allot the posts ineach year of allotment as contemplated under rule 12 read with Rule 5(2)(a) and issue orders appointing substantively to the respective posts within the quota and determine the inter se seniority between the appellants promotees and R.R. Sheoran, direct recruits in the respective quota cadre posts of Executive Engineers etc. within four months from the date of receipt of this judgment. The inter se seniority of promotees and direct recruits shall be determined accordingly. All the inpugned promotions or those pending proceedings in the High Court or in this Court shall be subject to the above determination and the status quo would continue till the appointments according to the rules are made and seniority is determined in the light of the law declared inthis judgment. The appeals is disposed of accordingly. In the circumstances parties are directed to bear their respective costs.

The appellants, `the promotees ' from Class II service were promoted as Executive Engineers by relaxing five years length of service as Class II Engineers in officiating capacity on various dates between January 6, 1969 to May 29, 1971. Only the appellant No. 1 and two other were confirmed as Executive Engineers w.e.f. July 11, 1973, December 11, 1974 and December 9, 1975 respectively. The respondent No.1 was recruited and appointed directly as Asstt. Executive Engineer w.e.f. October 25,1971. he was also given relaxation of the length of service of five years as Asstt. Executive Engineer and was promoted as Executive Engineer on October 8, 1973 and was confirmed w.e.f. December 22, 1976. 199 All the appellants except one M.R. Gupta were further promoted as Superintending Engineers on different dates between 1980 to 1984 whereas the respondent No. 1 was promoted as Superintending Engineer on March 4, 1987. The applicant No. 1 was further promoted as Chief Engineer The validity of the promotion of respondent No. 1 to the post of Chief Engineer was challenged. The respondent No. 1 who was shown junior to the appellants, field Writ Petition seeking a writ of mandamus directing the second respondent, State Government to consider his case for promotion as Superintending Engineer from the date on which the respondents were promoted assigning the seniority over the appellants and the consequential reliefs. On reference, a Division Bench of the High Court held that respondent No. 1 was a member of the service from the date of his initial appointment as Asstt. Executive Engineer and the appellants and the proforma respondents were not members of the service and directed the Single Judge to dispose of the matter on merit, against which, this appeal on leave was filed. The appellants contended that the appellants being promoted as Executive Engineers against regular vacancies, which were neither a stop gap arrangement nor fortuitous, and being continued in service without any break from the respective dates o their promotion, they were members of the service in a substantive capacity as Executive Engineers from the respective dates of promotion; that since the respondent No. 1 was recruited as Asstt. Executive Engineer w.e.f. August 30, 1971 long after the promotion of the appellants, the appellants were seniors to the respondent No. 1 as Executive Engineers, as Proviso to Rule (5)2 entitles them to remain in a substantive capacity as Executive Engineer since requisite number of qualified Asst. Executive Engineers were not available for promotion; that in view of their continous officiation as Executive Engineers in terms of Rule 2(12)(a) of the rules, they must be deemed to be the members of the service from the dates of promotion and, therefore, they were seniors to the respondent no.1. The respondents contended that unless the appellants were appointed substantively to the cadre posts they could not be members of the service. The respondent No. 1 became a member of the service 200 from the date of his initial appointment as Asstt. Executive Engineer, therefore, he was senior to the appellants and proforma respondents. As agreed by the parties, this Court declare the law on the interpretation of the rules and leave the matter for the State Govt. to decide the inter seniority on merits. Disposing the appeal, it is. HELD: 1. Appointment to a post in accordance with the rules is a condition precedent and no one can claim appointment to a post or promotion, as of right, but has a right to be considered in accordance with the rules, Appointment by promotion or direct recruitment, therefore, must be in accordance with the rules so as to become a member of the service in a substantive capacity. Seniority is to be fixed in accordance with the principle laid down in the rules. [213G 214A] 2. The promotee has right to confirmation in the cadre post as per Rule 11(4) if a post is available to him within his quota or at a later date under rule 5(2) read with rule 11(4) and gets appointment under rule 8(11). His seniority would be reckoned only from the date of the availability of the post and the year of allotment, he shall be next below to his immediate senior promotee of that year or the junior most of the previous year of allotment whether officiating or permanent occupying the post within 50% quota. [214G 215A] 3. A direct recruit on promotion within his quota, though later to the promotee is interposed in between the periods and interject the promotee 's seniority; snaps the links in the chain of continuity and steals a march over the approved promotee probationer.[215B] 4. Mere officiating appointment by promotion to a cadre post outside the quota; continuous efficiation therein and declaration of probation would not clothe the promotee with any right to claim seniority over the direct recruits. The necessary conclusion would, therefore, be that the direct recruit shall get his seniority with effect from the date of the year of the allotment as Asstt. Executive Engineer which is not alterable. Where the promotee would get his seniority w.e.f. the date of the availability of the posts within 50% quota of the promotees. [215D] 5. The seniority of the promotee from Class II service Executive Engineer shall be determined with effect from the date on which the cadre post was available to him and the seniority shall be determined accordingly.[215F] 201 6. Under the Rules `determination of seniority would be made only after the promotee becomes a member of the service '. Therefore the year of allotment must be determined having regard to (i) availability of the cadre post within quota; (ii) satisfactory completion of the probation, and (iii) appointment to the post in the substantive capacity in term of Rules 12(6) and (7) read with Rule 11(4) and Rule 8(12). Any other construction would be contrary to the avowed object of the rules as a whole.[218B C] 7. There is neither invidious discrimination nor arbitrariness in Rule 2(12)(a) offending articles 14 & 16. The differentiation drawn between direct recruit and the promotee bears rational relation to the object of Rule 2(12). [219H] 8. The Government of Haryana to determine the cadre posts, if not already done, regularly from time to time including the post created due to exigencies of service in terms of Rule 3(2) read with appendix `A ' and allot the post in each year of allotment as contemplated under rule 12 read with Rule 5(2)(a) and issue orders appointing substantively to the respective posts within the quota and determine the inter se seniority between the appellants promotees and the direct recruit in the respective quota cadre posts of Executive Engineers etc. within four months from the date of receipt of this judgment. The inter se seniority of promotees and direct recruits shall be determined accordingly. [220D E] M.S. Mighlani vs State of Haryana & Anr. ; J.C. Yadav vs State of Haryana, ; K.K. Khosla vs State of haryana, [1990] 2 SCC 199; V.B. Badami, etc. vs Stat of Mysore [1976] 1 SCR 815; K.C. Joshi & Ors. vs Union of India & Ors., to. R.P. Khanna vs S.A.F. Abbas & Ors, at 557 C J; Baleshwar Dass & Ors. vs State of U.P. & Ors. , [1981] 1 SCR 449 at 463; B.S. Yadav vs State of Haryana, ; The Direct Recruit, Clall II Engineering Officers ' Association vs State of Maharasthra & Ors., ; at 745 Distinguished. 9. It is a cardinal rule of interpretation that a proviso to a particular provision of a stature only embraces the field which is covered by the main provision. It carves out an exception to the main provision to which it has been enacted by the proviso and to no other. The proper function of proviso is to except and deal with a case which would otherwise fall within the general language o the main enactment, 202 and its effect to confine to that case. Where the language of the main enactment is explicit and unambiguous, the proviso can have no repercussion on the interpretation of the main enactment, so as to exclude from it, by implication what clearly falls within its express terms. [211E F] 10. The scope of the proviso is to carve out an exception to the main enactment and it excludes something which otherwise would have been within the rule. It has to operate in the same field and if the language of the main enactment is clear, the proviso cannot be torn apart from the main enactment nor can it be used to nullify by implication what the enactment clearly says nor set a naught the real object of the main enactment, unless the words of the proviso are such that it is its necessary effect [211G H] 11. In interpreting the rule, effect must be given to allow everyone drawn from the sources to have their due share in the service and chances of involvement to effectively discharge the duties of the posts honestly and efficiently with dedication. Any wanton or deliberate deviation in the implementation of the rules should be curbed and snubbed and the rules must be strictly implemented to achieve the above purpose. If wanton doviations are allowed to be repeated, it would breed indiscipline among the services and amounts to undue favour to some and denial of equity for many for reasons known or unknown subverting the purpose of the rules.{213F] 12. Rules 2(1), 2(3), 2(7), 2(10), 2(12)(a) 5(2)(a) 8, 9(2) 11, 12(3) 12(5) to 12(7) to be construed harmoniously. lest the legislative animation would be defeated and the rules would be rendered otiose and surpluses. It would also adversely effect the morale and efficiency of the service.[215C] 13. With a view to have efficient and dedicated services accountable to proper implementation of Govt. policies, it is open and is constitutionally permissible for the State, to infuse into the services, both talented fresh blood imbued with constitutional commitments, enthusiasm,drive and initiative by direct recuritment, blended with matured wealth of experience from the subordinate services.[212G] 14. It is permissible to constitute an integrated service of persons recruited from two or more sources, namely, direct recruitment, promotion from subordinate service or transfer from other services. Promotee from subordinate service generally would get few chances of 203 promotion to higher echolans of services. [212H] 15. Avenues and facilities for promotion to the higher services to the less privileged member of the subordinate service would inculcate in them dedication to excel their latent capabilities to man to cadre posts {213A] 16. Talent is not the privilege of few but equal avenues made available would explore common man 's capabilities overcoming environmental adversity and open up full opportunities to develop one 's capabilities to shoulder higher responsibilities without succumbing to despondence. Equity talented young men/women of great promise would enter into service by direct recruitment when chances of promotions are attractive. [213B] 17. The chance of promotion would also enable a promotee to imbue involvement in the performance of the duties, obviate frustration and eliminate proclivity to corrupt practices, lest one would tend to become corrupt, sloven and mediocre and a dead wood. In other words, equal opportunity would harness the human resources to augment the efficiency of the service and undue emphasis on either would upset the scale of equality germinating the seeds of degeneration. {213D]

ition No. 8911 of 1981. (Under article 32 of the Constitution of India) Petitioner in Person K.G. Bhagat, Addl. Gen., N.C. Talukdar and R.N. Poddar for the Respondents. The Judgment of the Court was delivered by RANGANATH MISRA, J. The petitioner in this petition under Article 32 of the Constitution is a resident of Sultanbattery area in the State of Kerala and describing himself as a commuter of the Indian Railways he has alleged violation of fundamental rights guaranteed under Articles 19 and 21 and claims reliefs of mandamus to the Union of India for implementing the reports of the Kunzru, Wanchoo and Sikri Committees, appointing a fact finding Commission to inquire and report about the numerous train accidents from 1970 onwards and for several other directions to the Union Government and the instrumentalities connected with the administration of the Railways. As the petition which the petitioner, an allopathic doctor by profession, had himself drafted and filed was unduly long and repetitive, written submission with the assistance of counsel crystalising the issues for determination by the Court was filed, leave to amend the writ petition was granted and notice thereon was issued on August 2, 1982. The petitioner alleged, inter alia, that the Railways in this country are owned by the Central Government and on account of failure to fulfil the constitutional, statutory and commercial obligations by the Railways, adequate safety protection to the passengers and their properties is not available. The Indian Railways Act, 1890 ( 'Act ' for short) has prescribed several safety measures; based upon experience, the Railway Board through which apex body the administration is run and controlled has also prescribed rules and issued instructions which are not being properly implemented. The Union Government had appointed three high powered Committees in the post independence period, namely, the Kunzru, Wanchoo and Sikri Committees to investigate into the 712 affairs of the Railways with particular reference to accidents and though detailed and useful recommendations have been made by these committees, there has been no adequate implementation thereof. Particular reference has been made to the unmanned level crossings, increasing human error as a contributing factor to accidents, non allocation of adequate funds for improvements, improper utilisation of the assets and facilities, inefficiency in the administration at different levels, prevalence and increase of indiscipline, frequency of thefts, robberies and murders of passengers, ineffective checking and supervisory system, want of replacement of equipment and repairs to bridges as also non provision of adequate facilities to passengers. The Joint Director (Safety) has filed a counter affidavit in answer to the Rule on behalf of the respondents. It has been averred that the recommendations of the Accidents Enquiry Committees were examined and implemented within the limits of financial and material resources. So far as manned level crossings are concerned there were as many as 14471 of them as on March 1, 1982; unmanned level crossings were provided mostly on roads where the volume of road and train traffic was low. It has been further pleaded that periodic review is undertaken about manning of unmanned level crossings and opening of new level crossings in consultation with appropriate State Governments. Initially it used to be the obligation of the respective State Governments to provide for such level crossings at their cost in view of the accepted position that at a level crossing the right of way is of the train in preference to the traffic on the road. As that arrangement was not working well, with effect from April 1, 1966, a Railway Safety Work Fund has been set up and expenses are being met out of it. From 1978 potentially hazardous unmanned level crossings with a volume of traffic of more than 6000 train vehicle units or poor approach visibility are being manned in a phased manner at the cost of the Railways and control at the gate is also being improved. As on June 1, 1982, there were as many as 27233 unmanned level crossings on the Railways and if all of them are to be manned, a capital expenditure of 330 crore rupees would be necessary and similarly an annual recurring expenditure of Rs.44 crores will have to be met. As a measure of safety, whistle boards have been fixed near unmanned level crossings requiring the engine driver to whistle while approaching such level crossings. Most of the States have framed rules under the , making it obligatory for 713 drivers of motor vehicles to stop short of unmanned level crossings, observe and then proceed. Speed breakers are usually provided on the road approaches to all unmanned level crossings. With a view to educating the users of the roads wide publicity is given through newspapers, cinema slides, commercial broadcasting and the television about the hazards involved while negotiating unmanned level crossings. It has been alleged that unmanned level crossings are gradually being replaced by manned ones and improved technical gadgets are being provided for efficient operation. Relying on the Sikri Committee Report of 1978, it has been submitted that the State Governments appeared to be aware of their responsibilities in this matter and about 2/3 of the funds of the Safety Works had been utilised by March 31, 1982. While admitting that in the initial period utilisation of funds was poor and finalisation of schemes for over bridges and under bridges was slow, the situation is claimed to have improved and in 1982 83 as many as 15 works in different States involving an expenditure of Rs.22 crores have been cleared. Dealing with manpower, the counter affidavit asserts that direct recruits are given proper training required for the respective posts and only qualified people are entrusted with assignments. Pragmatic and scientific classification of various posts has been made and suitable care is being taken in this regard. So far as the locomotive drivers are concerned, strict vision standards have been laid down and general physical fitness is a prescribed pre requisite. Drivers are subjected to periodical medical examination until the age of 45 at intervals of three years and thereafter until superannuation every year. Every accident, it has been averred, is thoroughly enquired into to fix the responsibility for it and to visit the delinquent with proper punishment. Ordinarily such enquiries are conducted by the administrative machinery. Accidents involving loss of human life and properties estimated over one lakh are earmarked for enquiry by Commissioners of Railway Safety who as authorities appointed under section 4 of the Act function independently of the Railway Administration and are under the administrative control of the Ministry of Civil Aviation. Enquiries by the Railway officials are stipulated to commence within three days of the accident and are intended to be over within one week of their commencement, while enquiries by Commissioners of Railway Safety are also required to start within three days and official reports are required to be made within 60 days 714 of the accident. Adequate disciplinary control is exercised and on the findings of the enquiries, the delinquent officials are visited with necessary punishment. Adverting to robberies and dacoities in the running trains, it has been pointed out that they are problems of law and order, maintenance of which is an obligation of the State Governments. Government Railway Police, Civil Police and plain clothed CID officers operate for the purpose of reducing crime and for detection. A moiety share of the cost of GRP is borne by the Railway administration. Added to this the Railway Protection Force is maintained to protect consignments booked for transport as also Railway property. The overall strength of the GRP stands at 6,740. They escort passenger trains running at night by deploying armed guards, provide beat patrolling at stations and waiting halls, keep surveillance over criminals and post pickets at vulnerable points. With reference to improvements in the rolling stock and required gadgets, it has been stated that the Sixth Plan for the Railways has been termed as 'Rehabilitation Plan '. Overaged gadgets are intended to be withdrawn subject to availability of resources and manufacturing capacity within the country. The Planning Commission which is an expert body is responsible for fixing of the priorities. It has again been pleaded that there are nearly 120000 bridges on the Railways out of which 195 are important bridges and nearly 9400 are major bridges. It is said that every bridge is annually inspected and continuous record is maintained in regard to every bridge in the bridge register. On an average 400 to 600 bridges are annually built. Speed restriction is imposed on old and weak bridges and at present there are 202 such bridges. Figures of six years between 1977 and 1983 of the outlay on bridges have been provided which indicate substantial sums having been set apart for the rebuilding of bridges. It is said that the total life of 80 years for steel work and 100 years for masonry part of the bridges stipulated in the Railway Code is for the purpose of provision in the Depreciation Reserve Fund. The codal life does not have any direct relevance with the condition of a bridge and there is no necessity of rebuilding a bridge when its codal life is over. There has been no instance where the work of bridge rebuilding has been postponed for lack of funds and no accident has occurred owing to structural failure of any bridge or girders. 715 Colour light signalling which is an improved device less dependent on direct visibility and where signal is pre warned by a signal in the rear, is being provided on the trunk and main routes on a graduated scale. Automatic warning system has been introduced in Gaya, Mughalsarai and Howrah Burdwan chord line sections on the Eastern Railway. Due to theft of aluminium track magnets the system has been found not very satisfactory. Experiments are being made for evolving a design which would not be prone to theft. The petitioner has filed a rejoinder pointing out that the counter affidavit clearly indicated a negative approach on the part of the respondents to the entire matter. According to the petitioner assistance of 500 crores of rupees was to come during the year ending March 31, 1983 and from out of such funds, pressing improvements like manning the unmanned level crossings could be undertaken. Reliance has been placed on the observations of Sikri Committee that accidents at unmanned level crossings take a heavy toll of human lives every year. The petitioner has pleaded for abolition of overtime employment of safety category staff. He has pointed out that though he asked for directions for providing appropriate monitoring of speed of trains particularly at accident prone spots in the track, no reply has been given thereto in the counter affidavit. The strength of the GRP has been said to be totally inadequate keeping in view the size of the Railways and volume of the passenger traffic it handles. The petitioner has denied the assertion in the counter affidavit that no accident has taken place on account for defective bridges and has pointed out that the accident of June 6, 1981 on a river bridge in the Bihar State was attributable to this factor only. The petitioner has pleaded again for the introduction of the automatic warning system and has referred to a publication of the Directorate of Safety, Railway Board, entitled, "A Review of Accidents on Indian Railways 1979 80", where the introduction of automatic warning system has been suggested to be introduced to avoid accidents. He has also pleaded for enhancing the minimum compensation in the event of loss of life of a passenger arising out of accidents to a sum of Rs. 75,000 by appropriate amendment of section 82A (2) of the Act. The petitioner has found fault with the counter affidavit for being silent in regard to his plea for the appointment of Railway Inspectors to make periodical inspection of carriages, engines, tracks, etc. 716 The lis before us is not of the ordinary type where there are two contending parties, a claim is raised by one and denied by the other, issues are struck, evidence is led and the findings follow. Though the petitioner is commuter of trains run by the Indian Railways, the writ petition is essentially in the nature of public interest litigation and the petitioner has attempted to voice the grievances of the community availing the services of the Indian Railways. In view of the recent pronouncements of this Court no objection has been raised in the counter affidavit and we have not been called upon to adjudge the locus standi of the petitioner to maintain an action like this. Railways came to India in 1853 and the first track to be laid was of a small length connecting the then city of Bombay with a suburb. Through the decades that followed the expansion was usually for considerations of trade and commerce, troop movement and administrative convenience. More of expansion came gradually connecting almost the entire country through a well woven net work of Railways and by the time the country became independent most of the Railways had been nationalised and Railways constituted the most important commercial activity of the Government of India. As early as 1850 and three years before the opening of the first Railway track, Lord Dalhousie, the then Governor General of India had said in his minutes: "I trust they (the East India Company and the Government of India) will ever avoid the error of viewing Railways as private undertakings and will regard them as national works, over which the Government may justly exercise and is called upon to exercise stringent and salutary control This control should not be an arbitrary right of interference but a regulated authority defined and declared by law which is not to be needlessly or vexatiously exacted but which, in my humble judgment, is necessary at once for the interests of the State and for the protection of the public." (Minutes of Lord Dalhousie, July 4, 1850). This regard for the public interest during the pre independence period was often subject to the limitations imposed by the British Capital and Management and by British Commercial and economic interests until the Railways were nationalised between 1925 and 1944. 717 At any rate, by 1947 when the foreign domination ended, the Railways had emerged as the main viable and stable means of transport and were providing the lifeline and link throughout the length and breadth of the country. By 1955 the total length of all Indian Railways was 34705 miles and the capital sunk was more than 900 crore rupees. The rise in the importance of the Railways in the national sphere has been gradual. With the expansion of the Railways a high powered body known as the Railway Board has come to be placed at the apex of control and with the new set up following independence a Minister remained incharge to administer the affairs of the Railways through the Board. As early as 1924 by a resolution known as the Convention Resolution of the Legislative Assembly the Railway budget had been separated from the general budget and this historical practice has been continued till today. Today the Railways provide the most effective means of transport both for passengers also for the goods traffic. The Railways have a great impact in holding this great country together and in promoting and running its economy. Their contribution to the community is manifold some seen and others not apparently visible. Briefly stated, it is a big force, the largest employer in the country and a monopoly transport agency. Before we come to deal with the specific aspects raised in the writ petition and countered by the respondents certain general observations need be made. The Indian Railways are a socialised public utility undertaking. There is at present a general agreement among writers of repute that the price policy of such a public Corporation should neither make a loss nor a profit after meeting all capital charges and this is expressed by covering all costs or breaking even; and secondly, the price it charges for the services should correspond to relative costs. Keeping the history of the growth of the Railways and their functioning in view, the commendable view to accept may be that the rates and fares should cover the total cost of service which would be equal to operational expenses, interest on investment, depreciation and payment of public obligations, if any. We need not, however, express any opinion about it. After independence, keeping to the ideologies that had been nurtured during the period of struggle an attempt has been made 718 for the simplification of the classes in the Railways. Instead of first class, second class, inter class and third class, two classes only have been maintained, namely, the first class and the second class besides the air conditioned class. In developed countries usually the classification is higher and lower; sleeping or sitting and the like. In India 90% of the earnings in respect of passenger traffic come from the lower class commuters. Also after independence expansion projects have been undertaken and many areas which have hitherto remained unlinked and unconnected have been joined up as part of the national lifeline. Pandit Jawahar Lal Nehru, first Prime Minister of India had once said: "Our final aim can only be a classless society with equal economic justice and opportunity to all, a society organised on a planned basis for the raising of mankind to higher material and cultural level. . Every thing that comes in the way will have to be removed; gently if possible, forcibly, if necessary. And there seems to be little doubt that coercion will often be necessary. " This approach on principle does not appear to have been abandoned. It is proper that this is worked out also in the Railways and, as quickly as possible, classification conforming to this is introduced. It is manifest that the Indian Constitution has definitely rejected the authoritarian form of Government and directed the State to bring about an egalitarian social order through the rule of law. In keeping with this mandate several guiding policies are being indicated but implementation is not being made. What Tolstoy remarked can relevantly be quoted as apt: "The abolition of slavery has gone on for a very long time. Rome abolished slavery; America abolished it and we did, but only the words were abolished, not the thing. " The implementing machinery has become non functional. This is so not only in our country. Wilfred Jenks in his address in April 1972 to the International Law Organisation had summed up the position thus: 719 "Throughout the world there is an acute crisis of confidence in integrity and fairness. This crisis of confidence lies at the heart of political instability, economic disorder, industrial disturbance, racial and religious conflict, cultural anarchy, youth unrest and continuous international tension. Disruptive in all these fields, it paralyses action to remove its causes. " Burger, C.J. of the United States has said: "We are approaching the status of an imperfect society where capability of maintaining elementary security in the streets, in the schools and for the homes of our people is in doubt. At every stage of the criminal process, the system cries out for change. " What has been extracted above appropriately summarises the current situation all the world over. No purpose is served by placing the blame at the doors of the Government of the day. We must have realism and candour. Independence has been secured at great cost and sacrifice. It is our obligation to maintain it and create an environment in which its fruits can be harvested and shared. Freedom brings responsibility. There can be no rights without responsibilities. In our country, unfortunately individual rights seem to have received disproportionate emphasis without proper stress on corresponding social obligations and responsibilities. In a welfare State like ours the citizen is for ever encountering public officials at various levels, regulators and dispensers of social services and managers of State operated enterprises. It is of the utmost importance that the encounters are as just and as free from arbitrariness as are the familiar encounters of the rights. Edmund Burke spoke thus: "All persons possessing a portion of power ought to be strongly and awfully impressed with an idea that they act in trust, and they are to account for their conduct, in that trust to the one great master, author and founder of society. " 720 Equally apt are the observations of Lord Denning in his address to the National Conference of the Law Society in 1980: "When you look upon these scientific achievements, then look back for a moment on our world today, what do you see, Crime, increasing every where; sins, disgraceful sins, corroding corruption, increasing everywhere. When we see this, surely we recall the words of 2000 years ago what doth it profit a man if he gains the whole world and loses his own soul. " What is, therefore, of paramount importance is that every citizen must get involved in the determined march to resurrect the society and subordinate his will and passion to the primordial necessity of order in social life. Abraham Lincoln once told his Congress: "This country, with its institutions, belongs to the people who inhabit it." Such also is the position in our country. Everyone in the country must realise this and be told the great truth said by Lord Wright: "The safeguard of British liberty is in the good sense of the people." Liver sidge vs Anderson ; It is useful to conclude our general observations by quoting from Robert Ingersoll: "A Government founded on anything except liberty and justice cannot stand. All the wrecks on either side of the stream of time, all the wrecks of the great cities and all the nations that have passed away all are a warning that no nation founded upon injustice can stand. From the sand enshrouded Egypt, from the marble wilderness of Athens, and from every fallen crumbling stone of the once mighty Rome, comes a wail as it were the cry that no nation founded on injustice can permanently stand. " 721 Having thus cleared the way by indicating the approach, ordinarily the powers of the Court to deal with a matter such as this which prima facie appears to be wholly within the domain of the Executive, should have been examined. Lord Simond in Shaw vs Director, Public Prosecution, has observed: "I entertain no doubt there remains in the Courts of Law a residual power to enforce the supreme and fundamental purpose of the law, to conserve not only the safety and order, but also the moral welfare of the State and that it is their duty to guard against attacks which may be more insiduous because they are novel and unprepared for. " Mathew, J. in Murlidhar Aggarwal vs State of U.P., indicated: "Public policy does not remain static in any given community. It may vary from generation to generation and even in the same generation. Public policy would be almost useless if it were to remain in fixed moulds for all time. If it is variable, if it depends on the welfare of the community at any given time, how are the courts to ascertain it ! The Judges are more to be trusted as interpreters of the law than as expounders of public policy. However, there is no alternative under our system but to vest this power with Judges. The difficulty of discovering what public policy is at any given moment certainly does not absolve the Judges from the duty of doing so. In conducting an enquiry, as already stated, Judges are not hidebound by precedent. The Judges must look beyond the narrow field of past precedents, though this still leaves open the question in which direction they must cast their gaze." The learned Judge then quoted with approval the famous statement of Cardozo (The Nature of Judicial Process): 722 "No doubt there is no assurance that Judges will interpret the mores of their day more wisely and truly than other men. But this is beside the point. The point is rather that this power must be lodged somewhere and under our Constitution and laws, it has been lodged in the Judges and if they have to fulfil their function as Judges, it would hardly be lodged elsewhere. " The petitioner has grounded his petition on Articles 19 and 21 of the Constitution. Article 19, inter alia, guarantees freedom of movement throughout the territory of India and to practice any profession, to carry on any occupation, trade or business, and Article 21 guarantees that no person shall be deprived of his life and personal liberty except according to procedure prescribed by law. The petitioner has maintained that he, may every citizen of this country for the matter of that, is entitled to demand that the State shall provide adequate facilities and create and maintain an environment in which the right to move freely and carry on any business or profession would both be practicable and feasible. Since the State maintains the Railways which provide the link and make working out of both these rights possible, it is contended, such facilities should be in good shape, adequate, prompt, efficient, economic and within the reach of the common man, free from danger or apprehension of life. Similarly, this service must operate efficiently for transport of goods to facilitate business and practice of profession and trade by citizens. There is hardly any scope to doubt that the guarantees provided in Part III of the Constitution are fundamental and it is the paramount obligation of the State to ensure availability of situations, circumstances and environments in which every citizen can effectively exercise and enjoy those rights. The right to life has recently been held by this Court to connote not merely animal existence but to have a much wider meaning to include the finer graces of human civilization. If these rights of the citizens are to be ensured, it is undoubtedly the obligation of the Union of India and its instrumentalities to improve the established means of communication in this country. Here again, however, we need not express any opinion as we do not propose to give any directions to the opposite parties. No dispute regarding maintainability having been raised, that question also did not arise for consideration. We have said earlier that the Railways are a public utility service run on monopoly basis. Since it is a public utility, there is 723 no justification to run it merely as a commercial venture with a view to making profits. We do not know at any rate it does not fall for consideration here if a monopoly based public utility should ever be a commercial venture geared to support the general revenue of the State but there is not an iota of hesitation in us to say that the common man 's mode of transport closely connected with the free play of this fundamental right should not be. We agree that the Union Government should be free to collect the entire operational cost which would include the interest on the capital outlay out of the national exchequer. Small marginal profits cannot be ruled out. The massive operation will require a margin of adjustment and, therefore, marginal profits should be admissible. It is of paramount importance that the services should be prompt, efficient and dignified. The quality of the service should improve. Travel comforts should be ensured. Facilities in running trains should be ensured. Quality of accommodation and availability thereof should be ensured. The administration should remain always alive to the position that every bona fide passenger is a guest of the service. Ticketless travelling has to be totally wiped out. We are of the view that it is this class of passengers which is a menace to the system. Without any payment these law breakers disturb the administration and genuine passengers. Stringent laws should be made and strictly enforced to free the Railways from this deep rooted evil. Security both to the travelling public as also to the non travelling citizens must be provided and this means that accidents have to be avoided, attack on the persons of the passengers and prying on their property has to stop. Scientific improvements made in other countries and suitable to the system in our country must be briskly adopted. The obligations cast by the Railways Act and the Rules under it must be complied with. It is relevant to point out here that in the counter affidavit the respondents have denied some of the assertions of the petitioner, yet no dispute has been generally raised to the stand taken in the writ petition. We are alive to the fact that Government have limitations, both of resources and capacity, yet we hope that the Government and the Administration would rise to the necessity of the occasion and take it as a challenge to improve this great public utility in an effective way and with an adequate sense of urgency. If necessary, it shall set up a high powered body to quickly handle the many faced problems standing in the way. Giving directions in a matter like this where availability of resources has a material bearing, policy regarding 724 priorities is involved, expertise is very much in issue, is not prudent and we do not, therefore, propose to issue directions. We, however, do hope and believe that early steps shall be taken to implement in a phased manner the improvements referred to in the counter affidavit and in our decision. We think it proper to conclude our decision by remembering the famous saying of Henry Peter Broughan with certain adaptations: "It was the boast of Augustus that he found Rome of bricks and left it of marble. But how noble will be the boast of the citizens of free India of today when they shall have it to say that they found law dear and left it cheaper; found it a sealed book and left it a living letter; found it the patrimony of the rich and left it the inheritance of the poor; found it the two edged sword of craft and oppression and left it the staff of honesty and the shield of innocence. " It is only in a country of that order that the common man will have his voice heard. The dream can become a reality if every citizen becomes aware of his duty and before asking for enforcement of his right, volunteers to perform his obligation. And before we part, we must record our appreciation of the performance of the petitioner. He has taken great pains to highlight his stand collected a lot of relevant material and argued his case quite well a doctor by profession though. As this was a public interest litigation, we direct that he shall be entitled to consolidated cost of Rs. 5,000 recoverable from the Railway Ministry of the Union Government unless paid within two months hence.

Disposing off the petition, making certain observations and expressing its inability to issue any directions, except awarding costs, the Court. ^ HELD: 1. Giving directions in a matter like this, where availability of resources has a material bearing, policy regarding priorities is involved, expertise is very much in issue is not prudent to issue any directions. Ordinarily the powers of the court to deal with a matter such as this, which prima facie appears to be wholly within the domain of the Executive must be examined. [723 H, 724 A] The Govt. have limitations, both of resources and capacity. Yet, it is hoped that the Government and the Administration would rise to the necessity of the occasion and take it as a challenge to improve this great public utility (Railways) in an effective way and with an adequate sense of urgency. If, necessary, it shall set up a high powered body to quickly handle the many faced problems standing in the way. [723 G H] 2. As the present case is a public interest litigation, the petitioner is entitled to consolidated costs of Rs. 5,000 recoverable from the Railway Ministry of the Union Government. [724 F G] 3. There is hardly any scope to doubt that the guarantees provided in Part III of the Constitution are Fundamental and it is the paramount obligation of the State to ensure availability of situations, circumstances, and environments in which every citizen can effectively exercise and enjoy these rights. The right to life has recently been held by the Supreme Court to connote not merely animal existence but to have a much wider meaning to include the finer graces of human civilization. If these rights of the citizens are to be ensured, 710 it is undoubtedly the obligation of the Union of India and its instrumentalities to improve the established means of communication in this country. [722 E G] 3.2. The Railways are a public utility service run on monopoly basis. Since it is a public utility, there is no justification to run it merely as a commercial venture with a view to making profits. It is not known if a monopoly based public utility should ever be a commercial venture geared to supply the general revenue of the State but there is no doubt that the common man 's mode of transport closely connected with the free play of his fundamental right should not be. [722 H, 723 A] 3.3. The Union Government should be free to collect the entire operational cost which would include the interest on the capital outlay out of the national exchequer. Small marginal profits cannot be ruled out. The massive operation will require a margin of adjustment and, therefore, marginal profits should be admissible. [723 B C] 3.4. On the other hand, it is of paramount importance that the services should be prompt. The quality of the service should improve. Travel comforts, facilities in running trains and quality of accommodation and availability thereof should be ensured. The Administration should remain always alive to the position that every bonafide passenger is a guest of the service. Ticketless travelling has to be totally wiped out. It is this class of passengers which is a menace to the system without any payment, these law breakers disturb the administration and genuine passengers. Stringent laws should be made and strictly enforced to free the Railways from this deep rooted evil Security both of the travelling public as also to the travelling citizens must be provided and this means that accidents have to be avoided, attack on the persons of the passengers and prying on their property has to stop. Scientific improvements made in other countries and suitable to the system in our country must be briskly adopted. The obligations cast by the Railways Act and the Rules under it must be complied with. [723 C F] 3.5. At the same time, no purpose is served by placing the blame at the doors of the Government of the day. All of us should have realism and condour Independence has been secured at great cost and sacrifice. It is every citizen 's obligation to maintain it and create an environment in which its fruits can be harvested and shared. [719 D E] 3.6 Freedom brings responsibility. There can be no rights without responsibilities. In our country unfortunately individual rights have received disproportionate emphasis without proper stress on corresponding social obligations and responsibilities. In a welfare State like ours the citizen is for ever encountering public officials at various levels, regulators and dispensers of social services and managers of State operated enterprises. It is of utmost importance that the encounters are as just and as free from arbitrariness as are the familiar encounters of the rights. What is, therefore, of paramount importance is that every citizen must get involved in the determined march to resurrect the society and subordinate his will and passion to the primordial necessity of order in 711 social life. If is only in a country of that order that the common man will have his voice heard. The dream can become a reality if every citizen becomes aware of his duty and before asking for enforcement of his right, volunteers to perform his obligation. [719 E F, 720 B C, D, 724 E]

Appeal No. 158 of 1967. Appeal by special leave from the judgment and order dated August 5, 1966 of the Rajasthan High Court. in section P. Civil Regular Second Appeal No. 222 of 1964. section T. Desai, P. C. Bhartari, J. B. Dadachanji and Pukhraj Singh, for the appellant. S.V. Gupte, K. K. Jain and H. K. Puri, for respondents Nos. 1 to 9. That Judgment of the Court was delivered by P.Jaganmohan, Reddy, J. This Appeal by Special Leave of this Court is against the Judgment of a Single Judge of the Rajas 838 than High Court affirming the Judgment and decree of the, District Court with certain variations. Respondents 1 to 9 filed a suit against the Appellants and Respondents 10 and 11 and two others for a declaration that they have been carrying on and are entitled to carry on Darshan, Prakshal and Poojan etc. of the idol of Adeshwarji, the first Tirthankar in the Temple named after him at Paroli without interference according to the tenets observed by the Digambri Sect of the Jain religion. ' The said Temple of Shri Adeshwarji is said to have been in existence for 200 years while, the Respondents aver that the inscriptions on it bear Vikram Samvat 1510 (1454 AD). The Plaintiffs further alleged that the Temple was constructed and the idol, was consecrated according to and by the followers of the tenets of the Digamber sect; that the Plaintiffs and the other followers of the Digamber Sect have been performing Darshan, Prakshal and Poojan of the said idol according to their tenets every since the Temple was founded; that on the 23rd of December 1949 the Defendants attempted to convert the said idol into the idol of Swetambri Sect by putting Chakshus (artificial eyes ) thereon, but were prevented from doing so by a strong opposition of the followers of the Digamber Sect; that thereafter some temporary arrangements were made between the followers of the two Sects who agreed to maintain the status quo until a decision of the Civil Court on the rival claims of the parties was given; that in disregard of the temporary settlement and without getting the rights in the Temple adjudicated upon by the Civil Court, the Defendants made arrangements to put Dhwajadand and Kalash on the said Temple according to their tenets,, and that they also further learnt that the Defendants were intending to enclose the said idol by putting up doors and locks with the. object of interfering with and obstructing the free exercise by the Digamberies of their unfettered rights to perform Poojan, Prakshal and worship of the said ideal according to their tenets. On these allegations it was prayed that the Defendants be restrained by a permanent injunction from (i) erecting the Dhwajadand, and putting up Kalash; (ii) enclosing the idols by putting up doors and locks; or in any manner altering the nature and shape and appearance of the idols installed in the said Temple; or directly or indirectly doing any act or thing which may have the effect of wounding the religious susceptibilities and sentiments of the followers of the Digamberi Jain Sect; and (iii) from interfering with the free and unfettered rights of the Plaintiffs of performing Darshan. Prakshal and Poojan and other rites according to the tenets of Digamber Jain Sect. 839 The Defendants did not deny that they,intended to put the Netras ' but said that they did so because the Netras which the idol had even before the said date having been damaged and fallen out, new Netras were put up. They further claimed that since its existence the Temple of Adeshwarji has been in the possession of the Defendants who have been in exclusive management of the Temple and its property; that the Plaintiffs never used to do Poojan or Prakshal in the Temple nor had they any Tight thereto, and that when in 1949 there was a dispute between the parties a temporary arrangement was made but the Defendants did not admit any right of Plaintiffs to Poojan. It, was further averred that the said idol and the Temple is in all respects Jain Swetambri Sect, that it has been so used and described in all the historic records from time to time and that the Civil Court had no jurisdiction to decide the religious rights of the parties nor is it a dispute of a civil nature. On these pleadings issues were framed on 3 12 55 but subse quently after the evidence in the case was recorded and having regard thereto fresh issues were framed in substitution of the former ones on 4 6 57 but thereafter no evidence was led by either party. The controversy between the parties as is evident from these issues was, as to which Sect of the Jains the main idol of Adeshwarji belongs, which Sect has constructed the upper portion of the idol referred to and the nearby portion of the temple; under what tenets have the followers of the Sects, Digamber and Swetamber, performed Darshan, Prakshal and Poojan of the idol of the temple referred to and can any Sect change those previous tenets , whether the Notras (artificial eyes) of the idol, Bhujband and Dhwajadand over the temple existed before and if not, can they be placed and inserted now; and whether the Temple is in possession and under the management of the Defendants alone from the time it came into existence. The Civil Judge of Bhilwara decreed the suit of the Plain tiffs, against which the Defendants appealed. The District Judge, however, allowed the appeal and dismissed the suit on the ground that in his opinion no question of any right to property or office was involved in the suit ' and consequently the plaintiffs suit was dismissed with costs. On an appeal from this Judgment the High Court allowed the Appeal holding that inasmuch as the allegations in the plaint relate to an assertion of a right of worship and an interference with that right, a dispute of civil nature arises which is, clearly cognizable by a Civil Court. In this view the case was, remanded to the District Judge for determining the appeal on merits. Leave to Appeal was also refused. 840 After remand the District Judge confirmed the Judgment and decree of the Trial Court with certain variations. Against this Judgment the Appellants filed an appeal to the High Court and the Respondents filed cross objections. The High Court affirmed the Judgment of the District Judge except for that part of the decree directing the Appellants to keep open the doors of the Temple between 8.30 and 9.30 each morning to enable the Respondents to worship without interference, which, however, was modified to enable Respondents to worship at the Temple between 6 a.m. to 9 a.m. every morning, during which time the Temple was not to be locked. It further directed that if the Swetambaries wanted also to worship during this period without disturbing the Digamberies they had the liberty to do so. The learned Advocate for the Appellants Shri section T. Desai urged several contention before us namely; (i) the High Court was in error in not deciding the ownership of the Temple or of the idol; (ii) that it should have held that a presumption of ownership would arise having regard to the concurrent findings that the Swetamberies were in management and possession of the Temple; (iii) that the reliefs claimed make it clear that the dispute is not of a civil nature for in any view of the matter the Courts were in error that placing of the Dhwajadand and Kalash on the Temple changes the nature of the temple; (iv) that the High Court should not have accepted the cross appeal fixing 3 hours time for the worship of the Digamberies Sect; (v) that the Judgment of the Trial Court is wholly vitiated because the Trial Judge not having accepted the evidence based his findings on his own inspection. Before as deal with these contentions, it is necessary to detail the findings of the Courts below The Trial Court while decreeing the Plaintiff 's suit held that though it was not proved as to who built the Temple of Adeshwarji initially, both Digamberies and Swetamberies worshipped in the said Temple; that the management and the possession of the Temple was with the Defendants Swetamberies for a long time, that the Swetamberies were not entitled to put artificial eyes or to put Dhwajadand or Kalash on the Temple; and that the Defendants were trying to interfere with the rights of the Plaintiffs ' and were making alterations to transform the character of the Temple. In this view the Trial Judge gave a declaration in favour of the Plaintiffs against Defendants in their personal capacity as well as representatives of the Jain Swetamberies Sect that the Plaintiffs or the followers of the Digamberi Sect have been performing Prakshal, Poojan and Darshan and are also entitled to do so in future. He also issued a permanent injunction against the Defendants in their personal capacity as well as representatives 841 of the Jain Swetamberi Sect restraining them from changing the shape and appearance of the idol by putting Netras (artificial eyes), Armlets, and Mukat, from erecting Dhwajadand and putting Kalash on the Temple and putting locks on the shutters of the Temple. The Appellants were further directed not to restrain the followers of the Jain Digamber Sect from performing Darshan, Poojan and Prakshal according to their tenets. After the remand Appellants urged before the District Judge the following contentions : (1)That the Temple belongs to Swetamber Sect and the Plaintiffs are entitled to have Darshan only of the idol, otherwise they have got no right to worship it according to their tenets; (2) That the idol being Swetamberi, the Defendants are entitledto put artificial eyes in the idol, Dhwajadand and Kalash on them Temple; (3) That the Defendants having been managing the Temple for the last so many years, their management cannot be interfered with it for the betterment of the idol, it is kept under lock, it cannot be said to wound the sentiments and religious feelings of the Plaintiffs. The District Judge held on the first contention that though the Temple is admittedly an old one there is not an iota of evidence as to who constructed the Temple originally; that the Appellants have been in management and possession of the Temple, which fact was not really challenged by the Respondents, though this by itself does not imply that the Temple is a Swetamberi Temple. It was also contended that the Respondents had no right to worship the idol but can only have Darshan. This contention was also rejected on a review of the evidence led by both parties, and also, by relying on Exh. 1 which embodied a compromise between the two Sects under which the right of the Respondents to worship the idol was specifically admitted. On the second point urged before him the District Judge held that the Appellants case that there were eyes already in the idol, but as they got damaged they wanted to replace them is not substantiated by the evidence led on behalf of the Appellants themselves. It also held that an attempt was made by, the Swetamberies in 1949 to install the eyes in the idol and that as most of the Appellant 's witnesses admitted that though Dhwajadand was offered on certain occasions which were retained by the Oswals (Swetamberies) there was no Dhwajadand and Kalash on the temple itself. On the third point it was held that the Appellants, who were in management and possession of the Temple for the last so many 842 years, have a right to lock the main Temple, to prevent it from being defiled, which does. not in any way interfere with the right of worship of the Respondents or any other person on their behalf. This being so ' the Trial Courts decree excepting for restraining the Appellants to lock the Temple was affirmed subject to the further,direction as already noticed keeping the Temple open for worship of the Respondents and the Digambaries Sect between 8.30 and 9.30 a.m. When the appeal and cross objections were pending before the High Court the Appellants filed an application under Order 41, Rule 27 of the Civil Procedure Code for recording the evidence of Shri Satya Prakash Srivastava, Director of Archaeology and Museum, Rajasthan to establish the denominational identity of. the idol in the Temple. It was stated in that, application that since he District Judge had remarked that the parties had not produced sufficient evidence and it was not possible to come to any conclusions regarding the nature of the idol as to whether it is Swetamberi or Digamberi, the petitioner had moved the Direc tor of Archeology who after a thorough examination came to the conclusion that the idol was Swetamberi. In view of this Report it was prayed that the said Director be called in evidence and be examined. In the alternative it was prayed that the case be remanded to the Trial Court for allowing the parties to lead additional evidence so that effective adjudication can be made. The High Court however, did not feel the need for any additional evidence as the case could be disposed of on the material on record. In this view it dismissed the application. Even before us the learned Advocate for the Appellant tried to persuade us to look into that Report and urged that the evidence of the Director was necessary and ought to have been allowed to be adduced. In view of the concurrent findings of all the Courts on certain material aspects of the case to which we shall presently refer, it is possible to determine the controversy between the parties, as such we agree with the High Court that no additional evidence is required at this stage, though the parties could have led better evidence in the initial stages itself. It was further contended on behalf of the Appellants that the Respondents suit was not maintainable because it did not involve a dispute of a Civil nature. Respondents ' learned Advocate though he first indicated that he would raise a preliminary objection to this contention being urged because when the High Court set aside the Judgment of the District Judge and remanded the case to be decided on merits holding that the suit was maintainable as it raised a dispute of a civil nature, the Appellants ought to have appealed to the Supreme Court. The learned Advocate for the Appellants however contends that the remand order of the 843 High Court did not finally dispose of the rights of the parties as such it is open to him to urge in this appeal that the suit was not maintainable on the ground that it does not raise any dispute of a civil nature. Though the preliminary objection was not subsequently pressed even on the merits, the learned Advocate for the Appellant is unable to satisfy us that the suit is not of a civil nature. From the pleadings and the controversy between the parties it is clear that the issue is not one which is confined merely to rites and rituals but one which effects the rights of worship namely whether the Swetamberies by placing Chakshus, Dhwajadand and Kalash according to their tenets or by locking the temple could preclude the Digamberies from worshipping in accordance with their tenets. It is admitted that the Digamberies will not worship the idol which is not Nirakar ' or which has Chakshus. If the Digamberies have a right to worship at the temple the attempt of the Swetamberies to put Chakshus or to place Dhwajadand or Kalash in accordance with their tenets and to claim that the idol is a Swetamberi idol was to preclude the Digamberies from exercising their right to worship at the temple. These findings clearly establish that the Appellants interfered with the rights of Digamberies to worship with respect to which a civil suit is maintainable under Section 9 of the Civil Procedure Code. This position is well established. If authority was needed we may refer only to two cases. The Privy Council in Sir Seth Hukam Chand & Ors. vs Maharaj Bahadur Singh & Ors.(1), had to deal with the practices observed by Digamberies and Swetamberies on the Parasnath Hill which is considered to be sacred by. both the Sects but in respect of which the Digamberies objected to the continuous employment of human beings on the Hill and against building thereon of Dwellings necessarily involving according to their tenets of a sacrilegious pollution and desecration of the sacred hill, while the Swetamberies had no such belief. Sir John Wallace delivering the opinion of the Board observed :"These are matters for the Jain themselves and the Civil Courts are only concerned with them in so far as they are relevant to questions of civil right such as an alleged interference with the Plaintiffs rights to worship on the hill, and in that case the issue must be not whether the acts complained of are in accordance with orthodoxy or with previous practice, but whether they do in fact interfere with the plaintiff 's rights of worship". Again this Court in Nar Hari Sastri and Others vs Shri Badrinath Temple Committee (2 ) was concerned with the rights of the Deoprayagi Pandas to enter the Badrinath Temple alongwith their Yajmans or clients, which it was claimed the Pawal or the Trustee denied and threaten to obstruct the said Deoprayagi (1) (2) ; 844 Pandas from entering the precincts of the Temple along with their Yajmans or from assisting the pilgrims in the matter of Darshans etc. inside the Temple. The Defendant however, asserted that it was neither necessary nor desirable that the plaintiffs should be allowed to accompany their Yajmans or clients into the Temple, as he had himself made adequate arrangements for the Darshan and worship of the pilgrims and that as the sole Trustee and manager of the Temple he had the right to regulate entry into the Temple so the over crowding might be avoided and order maintained inside it. Mukerjea J, (as he then was) speaking for the Court dealt with this contention in the following passage "The true position therefore is that the Plaintiffs ' right of entering the temple along with their Yajmans is not a precarious or permissive right depending for its existence upon the arbitrary discretion of the Temple authorities; it is a legal right in the true sense of the expression but it can be exercised subject to the restrictions which the Temple Committee may impose in good faith for maintenance of order and decorum within the Temple and for ensuring proper performance of customary worship. In our opinion, the Plaintiffs are entitled to a declaration in this form. " It is clear therefore that a right to worship is a civil right, interference with which raises a dispute of a civil nature though as noticed earlier dispute which are in respect of rituals or ceremonies alone cannot be adjudicated by Civil Courts if they are not essentially connected with Civil rights of an individual or a sect on behalf of whom a suit is filed. In our view the contention of the learned Advocate for the Appellant to the maintainability of the suit is not well founded. One other objection which the learned Advocate for the Appellants urged at the outset is that the findings of the Trial Judge are vitiated because he did not rely on the evidence on record but decided to which Sect the idol in dispute belongs, only on what he found on his inspection of the idol and the Temple which cannot be evidence in the case, without his being subjected to cross examination. It is further contended that even if what has been stated in the Judgment is what the Trial Judge had observed in his inspection there is nothing to show that he had drawn up inspection notes and made them part of the record as required under the law. The contention that the Trial Judge had given his findings mainly on the observations made during his inspection in the first place is based on insufficient appreciation of what was really observed when dealing with the question as to 845 which Sect the idol in dispute belongs. It was observed in the Judgment that most of the witnesses produced were non Jains and therefore, their evidence does not carry much weight to establish to which Sect the idol belongs. After stating that the remaining witnesses of the parties have given statements in favour of their party the Trial Judge said that these statements also cannot be much relied upon. The decision of his case is based mostly on the site inspection and the evidence on record. Even while giving the findings the Trial Judge remarked that the evidence led by the Plaintiff appears to be correct. These observations themselves show that the evidence on record was an element in the formulation of the Trial Courts Judgment buttered by the observations of the learned Judge during the site inspection. There is therefore, no validity in the contention that the finding of the Trial Judge was based entirely on the result of his inspection. It is also evident from a narrative given in the Judgment of what was noticed during the inspection that the Judge had inspected the site on two occasions once on 24 3 1956 and again a year and two months thereafter on 23 5 1957. The details given by him could not have been given if he had not made some inspection notes. It would also appear that at the time of the inspection Council for the Plaintiffs and Defendants were present because when giving a description of the idol of Neminathji in the Swetemberi Jain Temple when it was noticed that some portion of the idol under the waist and naval is raised and is like a line, the Council for the Plaintiffs pointed out to him that mark denoted the wearing of a loin cloth while the Counsel for the Defendants said it was the mark of an Artist. Again in respect of the observation that on the back side and at the lower portion of the navel some portion is raised, the Counsel for the Plaintiffs had pointed out to the loin cloth, while the Counsel for the Defendants said that it has been engraved by an Artist without any sense. We are satisfied that the description given by the learned Judge of the idols in the Adeshvarji Temple and the Temple of the Swetambaries were observations made during an inspection at which both the Plaintiffs ' and Defendants ' Advocates were present and that there must have been notes also in respect of the inspection made on both the occasions. The Appellants had at no time made a grievance either to the District Judge or to the High Court or even before this Court except during the stage of arguments that there were no inspection notes nor that the inspection was made by the Judge behind the back of the parties. if these objections had been raised earlier the Respondents would have had an opportunity of showing that there were inspection notes. The Judgment in our view is not based solely on the result of personal inspection made by the Trial Judge, which inspection was for the purposes of understanding the evidence in the case and has been so used by the Trial Judge. We must, 846 therefore, reject the contention of the learned Advocate for the Appellants that the finding in respect of the idol is vitiated. In this view it is not necessary to deal with any of the decisions referred to before us. It was contended by Shri Desai that unless the ownership of the Temple is established or that the idol belongs to the Digamberies no injunction can be given nor the Plaintiffs permitted to worship. It is argued that in the plaint the Respondents wavered that the idol is a Digamberi idol and if they have failed to prove it then their right to worship fails. At any rate the argument proceeds that the High Court was in error in not deciding the ownership of the Temple or of the idol. We have earlier indicated the plaint averments in which there is no mention of the ownership of the Temple or of the idol but that paragraphs 2 and 3 of the plaint merely gave a description of the Temple and the idol when it is averred that the idol was constructed and consecrated according to and by the followers of the Digamberi Sect and that the Plaintiffs and the other followers of the Digamberi sect have been performing Darshan, Prakshal and Poojan of the said deity in the said Temple for a considerable number of years past and really ever since the Temple was founded. There is therefore, force in the contention of Shri Gupte, learned Advocate for the Respondents that having regard to the concurrent findings of the Courts below that the idol was Nirakar ' (naked) that there were no Chakshus, no Mukat, no Armlet, no Dhwajadand or no Kalash, would show that the idol was consecrated by the Digamberies. It was also held as had already been noticed that though it is not possible to say when the Temple was constructed and the idol consecrated it was an ancient Temple and that both the Digamberies and the Swetamberies worship the idol. It is not denied that while the Digamberies will not worship an idol which has Chakshus or which has clothes or Mukat( the Swetamberies would worship a Digamberi idol without these and hence the right to worship a Digamberi idol by both the sects is possible and indeed has been so held by all the Courts. Even the Defendants ' witnesses substantiate these findings. We would refer to only two of these witnesses. Shri Suwa Lal D.W. 4 even though he says that the Temple belonged to the Oswals in which he and his father has been performing Sewa for the last 30 or 35 years on behalf of the Oswals (Swetamberies) admitted that since he attained the age of discretion and upto the time of giving evidence he had never seen Adinathji wearing clothes, never saw the idol with eyes and had never seen Dhwajadand or Kalash on the Temple and does not know whether the idol belongs to Oswals or Saravagis (Digamberies). D.W. 3 Shri Pokhar a barber of Oswals also supports this witness. That the Digamberies had a right to worship is also borne out by exhibit 1 dated 847 23 12 49 which was a compromise entered into between Swetam beries and Digamberies at the time when the Swetamberies attempted to put Chakshus in the idol. No doubt this was an interim arrangement till the decision of a Civil Court adjudicating the respective rights, but there was never any question of either Sect not having the right to worship the idol. The dispute had arisen only as to whether Swetamberies can fix Chakshus in the idol. 1 states as follows: "We Panchas give this award that a dispute had arisen between the Swetamberies and Digamberies as Swetamberies recently fixed eyes on the idol. This new thing should not continue. These eyes should be removed. Digamberies have a right to perform Poojan so they can mark saffron Tiki ' and have Darshan and come back. Digambries will not performs Prakshal, Poojan. Swetamberies will continue incurring expenses as usual. The idol shall remain backed (Nirakar)". The representatives of both Sects have signed this award, as a temporary measure agreeable to both the Sects, who indicated that they would press their rights in a Civil Court. Once the right of worship of the Digamberies is established there is little doubt that they are entitled to the injunction sought for by them against the Defendants Appellants from preventing them from worshiping or from interfering with that right by placing Chakshus in the idol, Dhwajadand, Kalash on the Temple. In view of these findings the further question that when once it has been found that the Swetamberies have the right of management and possession of the Temple there is a presumption of ownership under Sec. 110 of the Evidence Act does not arise nor is it relevant. It is no doubt contended by the Respondents Advocate that when consecration of an idol takes place the ownerships of the Temple is in the idol and therefore, the question, of presumption under Sec. 110 does not arise. It is again contended by Shri Desai that the moment it is held that it is not possible to, come to a conclusion as to which Sect the idol belongs, as has been held by the Court below, the Respondents cannot be allowed to object to the Appellants worshipping the idol according to their tenets. This contention, however, in our view ignores the rights of the Digamberies to worship in accordance with their tenets. If the contention of the learned Advocate for the Appellants is accepted it will be tantamount to holding that Digamberies have no right to worship as there would denomination change in the idol if the Swetamberies are held to have the right to worship it according to their tenets by placing Chakshus in the idol or by erecting their Dhwajadand or Kalash over the Temple. 848 Lastly it is urged that the High Court ought not to have entertained the cross objection by extending the time for worship from 1 hour to 3 hours. In our view the directions of the High Court are not unreasonable nor do they in any way affect the right of the Respondents to worship because the directions clearly enable the Swetamberies who wish to worship the deity within that period without disturbing the Digamberies to be at liberty to do so and likewise it will be open to Digamberies to go and worship in the temple during the period it is kept open. In view of the acute controversy between these 2 sects and their reluctance to arrive at an amicable settlement the directions given by the High Court are manifestly reasonable just and proper. In this view the appeal fails and is dismissed with costs. R.K.P.S. Appeal dismissed.

Respondents 1 to 9 filed a suit against the Appellants and some of the other respondents for a declaration that they hid been carrying on, and were entitled to the worship without interference of the idol of Adeshwarji in the temple named after him at Paroli according to the tenets observed by the Digambri Sect of the Jain religion. They further alleged : that the temple was constructed and the idol consecrated according to and by the followers of their sect; that in December, 1949, the defendants had attempted to convert the said idol into the idol of the Swetambri Sect by putting Chakshus (artificial eyes) thereon, but were prevented due to strong opposition of the followers of Digambri Sect. It was claimed that although a temporary settlement was reached between the two sects while the rights in the temple were to be adjudicated upon by a Civil Court, the defendants had made arrangements to alter the temple according to their tenets and that they were intending to enclose the idol by doors and locks with the object of interfering with the free exercise of a Digambris ' right to worship the idol. It was therefore prayed that the defendants be restrained by a permanent injunction from altering the nature and shape and appearance of the idol in any manner or from doing any act which would interfere with the right of worship of the followers of the Digambri Sect. The defendants denied that the Digambri Sect had any right of worship of the idol or had ever exercised such a right and contended that the idol and the temple is in all respects a temple of the Jain Swetambri Sect. The Trial Court decreed the suit and the District Judge in appeal as well as the High Court confirmed the decree. The High Court also fixed three hours a day when the Digambris may use the temple for worship In appeal to this Court, it was contended inter alia on behalf of the appellant that the reliefs claimed made it clear that the dispute was not of a civil nature; and that the judgment of the Trial Court was wholly vitiated because the Trial Judge not having accepted the evidence produced before him, based his findings on his own inspection. It was also contended that unless the ownership of the temple, was established or that the idol belonged to the Digambri Sect, no injunction could be given nor could the respondents be permitted to worship there; in the plaint the respondents had averred that the idol is a Digambri idol and as they had failed to prove this, their right to worship also failed. HELD:Dismissing the appeal, (i)From the pleadings and the controversy between the parties it was clear that the issue was not one which was confined merely to rites and rituals but one which effected the rights of worship. If the Digambries have a right to worship at the temple, the attempt of the Swetam 837 belies to put Chakshus or to place Dhwajadand or Kalash in accordance with their tenets and to claim that the idol is a Swetamberi idol was to preclude the Digamberies from exercising their right to worship at the temple, with respect to which a civil suit is maintainable under Section 9 of the Civil Procedure Code. This position is well established. [843 B] Sir Seth Hakam Chand & Ors. vs Maharaj Bahadur Singh & Ors., 60 I.A. 313 and Nar Hari Sastri and Ors. vs Shri Badrinath Temple Committee; , , referred to. (ii)While, giving his findings the Trial Judge remarked that the evidence led by the Plaintiffs appeared to be correct. These observations themselves show that the evidence on record was an element in the formulation of the Trial Court 's judgment buttressed by the observations of the learned Judge during the site inspection. it was clear that the description given by the learned Judge of the idols in the Adeshwarji Temple and the Temple of the Swetemberies were observations made during an inspection at which both the Plaintiffs and Defendants Advocates were present and that there must have been notes also in respect of the inspection made on both the occasions. There was therefore no validity in the contention that the finding of the Trial Judge was based entirely on the result of his inspection. [844 G 845 C] (iii)The concurrent findings of the Courts below that the idol was Nirker ' (naked), that there were no Chakshus, no Mukat, no Armlet, no Dhwajadand or no Kalash, would show that the idol was consecrated by the Digamberies. It was also clear that it was an ancient temple and that both the Digamberies and the Swetamberies worship the idol. It was not denied that while the Digamberies will not worship an idol which has Chakshus or which has clothes or Mukat, the Swetamberies would worship a Digamberi idol without these and hence the right to worship a Digamberi idol by both the sects is possible and it has been rightly so held by all the courts. [846 E] Once the right of worship of Digamberies was established they would be entitled to the injunction sought for by them against the Appellants from preventing them from worshiping or from interfering with that right by placing Chakshus in the idol, Dhwajadand, Kalash on the Temple. The directions of the High Court extending the time for worship by Digamberi Sect from one hour to three hours was not unreasonable. [848 A B]

Appeal No. 1768 of 1969. Appeal by special leave from the judgment and order dated October 8, 1968 of the Mysore High Court in Writ Petition No. 657 of 1968. 189 M. C. Setalvad, Ram Punjwani and section P. Nayar, for the appellants. R. B. Datar and M. section Narasimhan, for the respondent. M. K. Ramamurthi, Shyamala Pappu and J. Ramamurthi, for intervener No. 1. section Ramasubramanian and J. Ramamurthi, for intervener No.2. The Judgment of the Court was delivered by Vaidialingam, J. In this appeal, by special leave, the question that arises for consideration is regarding the validity of the new Note substituted in place of the old Note on December 23, 1967 to cl. (b) of rule 2046 (F.R. 56) of the Indian Railway Fundamental Rules. The High Court by its judgment and order, under appeal, dated October 8, 1968, has struck down the new Note as dis criminatory and violative of article 14 of the Constitution. The respondent was originally an employee of the Madras and Southern Mahratta Railway Company (hereinafter to be referred as the Company) having joined the service on August 16, 1927 as Clerk Grade 1. His date of birth, there is controversy, was April 15, 1910. The Company was amalgamated with the Indian Railway Administration in the year 1947 and on .such amalgamation, the respondent became the employee of the Indian Railway Administration. There is also no controversy That he came within the classification of a "ministerial railway servant" within the meaning of that expression, occurring in rule 2046. Rule 2046 deals with retirement of a railway servant At the time of amalgamation, under cl. (1) of the said rule, the date of retirement of a railway servant, other than a ministerial railway servant was the date on which he attained the age of 55 years. It was also provided therein that the said railway servant, ,after attaining the age of retirement, may be retained in service with the sanction of the competent authority on public ground to be recorded in writing. But there was a prohibition regarding retention of such a railway servant after the age of 60 years except in very special circumstances. Clause (2) of the said rule, which deals with a ministerial railway servant, under which category the respondent falls, at the time of amalgamation was as follows : "2046 (2) (a) A ministerial servant, who is not governed by sub clause (b), may be required to retire at the age of 55 years, but should ordinarily be retained in service, if he continues efficient up to the age of 60 190 years. He must not be retained after that age except in very special circumstances, which must be recorded in writing, and with the sanction of the competent authority. (b) A ministerial servant (i) who has entered Government service on or after the 1st April, 1938, or (ii) who being in Government service on the 31st March, 1938 did not hold a lien or a suspended lien on a permanent post on that date. shall ordinarily be required to retire at the age of 55 years. He must not be retained after that age except on public grounds which must be recorded in writing,, and with the sanction of the competent authority and he must not be retained after the age of 60 years except in very special circumstances. " It will be noted that under sub clause (a), quoted above, a ministerial servant, who is not governed by sub clause (b) may be required to retire at the age of 55 years; but if he continues to be efficient, he should ordinarily be retained in service upto the 'date of 60 years. Retention in service after the age of 60 years, can only be under very special circumstances, to be recorded in writing and with the sanction of the competent authority. There was a further special provision made under cl. (b) in respect of a ministerial servant who had entered Government service on or after April 1, 1938 or being in Government service on that date, did not hold a lien or a suspended lien on a permanent post oh that date. On December 5, 1962, the Railway Board addressed a com munication to the General Managers of All Indian Railways that the Government were considering the question for some time whether the age of compulsory retirement of railway servants should be raised above 55 years. It is further stated that the President is pleased to direct that the age of compulsory retirement of railway servants should be 58 years subject to the three exceptions mentioned in the order. The only relevant exception is Exception No. 1 relating to ministerial railway servants, which was as follows : "(i) The existing rule 2046 (F.R. 56) (2)(a) RII, under which ministerial railway servants who held a lien or suspended lien on a permanent post on 31st March, 1938 are to be retained in set vice upto the age 191 of 60 years subject to their continuing to be efficient and physically fit after attaining the age of 55 years, will remain in force. It will be seen from the decision,of the Government, as com municated in the above letter, that the age of retirement of railway servants was raised from 55 to 58 years. But this was subject to the restriction regarding the continuance of a ministerial servant after 55 years upto the age of 60 years as provided for under sub clause (b) of cl. (2) of rule 2046. On January 11, 1967, the old rule 2046 as amended in 1962 was substituted by the new rule. The new rule consisted of four clauses, but we are not concerned with clauses (c) and (d) The material part of the said rule relevant to be noted are clauses (a) and (b) together with the note to clause (b) which ran as follows : "2046 (FR. 56) (a) Except as otherwise provided in this rule, every railway servant shall retire on the day he attains the age of fifty eight years. (b) A ministerial railway servant who entered Government service on or before the 31st March, 1938 and held on that date (i) a lien or a suspended lien on a permanent post, or (ii) a permanent post in a provisional substantive capacity under Clause (d) of Rule 2008 and continued to told the same without interruption until he was confirmed in that post,shall be retained in service till the day he attains the age of sixty years. NOTE : For the purpose of this Clause, the expression "Government Service" include service rendered in ex company,, and ex State Railways, and in a former provincial Government." Two aspects broadly emerge from the above new rule : (a) every ministerial railway servant who had entered Government service on or before March 31, 1938 and who satisfied the conditions mentioned in sub clause (i) or (ii) of clause (b) had a right to continue in service till he attained the age of sixty years; and (b) under the Note, the expression "Government Service" in clause (b) takes in service rendered in ex company, ex State Railways and in a former provincial Govern 192 ment. There is no controversy that the respondent held a permanent post in the Company on March 31, 1938. Therefore,, under this new rule, he would be entitled to continue in service till he attained the age of sixty years, as provided in cl. (b) read with the Note thereto. On December 12, 1967, the Note to cl. (b) of rule ' 2046 defining the expression "Government Service" as per the order dated January 11, 1967 was deleted, and a new Note was substituted in its place. The order dated December 23. 1967 together with the new Note is as follows : "For the existing note, substitute the following For the purpose of this clause the expression "Government Service" includes service rendered in a former provincial government and in ex. Company and ex. State Railways, if the rules of the Company or the State had a provision similar to Clause (b) above. " From the new Note, extracted above, it will be seen that the definition of the expression "Government Service" was changed. The effect of the new Note, so far as the respondent is concerned, is that whereas he was entitled to continue in service upto 60 years, as per clause (b) read with the note thereto under rule 2046 as substituted on January 11, 1967, now he can get service upto 60 years only if the Company had a provision similar to cl. (b) of rule 2046. There is no dispute, that under the service conditions applicable to the respondent, when he was an employee of the Company, he had no right to continue in service till he attained the age of sixty years. On the other hand, under the service conditions of the Company he had to retire at the age of 55 years. It appears, that after the introduction of the new rule 2046 on January 11, 1967, the Divisional Accounts Officer, Hubli, passed an order on March 31, 1967 that the respondent was entitled to continue in Office till he attained the age of 60 years. But after the new Note to cl. (b) to rule 2046 was substituted on December 23, 1967, the Divisional Accounts Officer, Hubli, passed an order on January 17, 1968 to the effect that the respondent is to retire from service on April 14, 1968 on which date he would be attaining the age of 58 years. The said order also states that this action was being taken in view of the new Note substituted on December 23, 1967 to cl. (b) of rule 2046. The respondent filed on March 6, 1968 in the Mysore High Court, Writ Petition No. 657 of 1968 challenging the legality and validity of the order dated January 17, 1968 retiring him from service with effect from April 4, 1968. In the writ petition 193 he had referred to his previous service in the Company and to the latter being amalgamated with the Indian Railway Administration in 1947. According to him, after such amalgmation he has become a ministerial railway servant under the Indian Railway Administration and all the rules applicable to the employees of the latter became applicable to him. In particular, he pleaded that he was entitled to continue in service, until he attained the age of sixty years, as per the new rule 2046 introduced on January 11, 1967, as he satisfies all the conditions prescribed under cl. (b) thereof. He particularly attacked the new Note to cl. (b) substituted on December 23, 1967 as discriminatory and violative of article 14 of the Constitution. According to him, the members of the Indian Railway Service, similarly situated like him, will be. entitled to continue in service till 60 years, whereas that right has been denied, to persons like him, under the new Note. He also referred to the order passed on March 31, 1967 by the Divisional Accounts Officer, Hubli in and by which it was directed that he was entitled to continue in service till 60 years. According to the respondent, the Railway Administration was not entitled to go back on this order. On these grounds, the respondent challenged the validity of the order directing him to retire on the basis of the new Note. The appellant contested the writ petition on the ground that the order dated March 31, 1967 was passed on the basis of the rule 2046, read with the Note, as it existed on January 11, 1967 But the position was changed by the deletion of the original Note to cl. (b) and its substitution by the new Note on December 23, 1967. The appellant claimed that the service conditions of persons, like the respondent, have always been different from those serving under the Railway Administration and that by the introduction of the new Note, no discrimination has been practised on any officer. On the other hand, according to the appellant, the new Note only gave effect to the conditions of service, which obtained in the Company, where the respondent originally joined service. The appellant further pleaded that the new Note does not violate article 14 of the Constitution. The High Court, by its judgment and order dated October 8, 1968 has accepted the contentions of the respondent and held that the new Note substituted to cl. (b) of rule 2046 on December 23, 1967 is discriminatory and violative of article 14 of the Constitution. In this view, the said Note was struck down. In consequence, the High Court set aside the order dated January 17, 1968 and gave a declaration that the respondent was entitled to continue in service till he attained the age of sixty years. Mr. M. C. Setalvad, learned counsel for the appellant, Rail way Board, has strenuously attacked the finding of the High 194 Court that the new Note, substituted on December 23, 1967 to cl. (b) is discriminatory and violative of article 14 of the Constitution. On the other hand, he urged that a distinction has always been made in the case of ministerial railway servant who is governed by cf. (b) and those who are not so governed by that clause of rule 2046. Different provisions regarding the age of retirement have been provided in respect of those two classes of ministerial railway servants. The new Note, Mr. Setalvad pointed out only gives recognition to the practice that has been obtain ing in respect of the ministerial railway servants under their previous employers. He further pointed out that the Note to cf. (b) of rule 2046, incorporated on January 11, 1967 gave the benefit of the expression "Government Service ' 'to persons, like the respondent, who have previously been working in ex Company, provincial Government or ex State Railways. The new Note keeps the same categories of employees within the expression "Government Service", but adds a qualification that in order to have the benefit of a longer period of service, they should have had such benefit under their previous employers. Mr. Setalvad further pointed out that a government servant has no right to continue in service till the age of 60 years and that the option to so continue him upto that age, vests exclusively within the discretion of the authority concerned. For this proposition the counsel relied on the decision of this Court in Kailash Chandra vs Union of India(1) interpreting clause (2) of rule 2046 as it existed prior to the amendment in 1962. In any event, Mr. Setalvad pointed out, that the officers who had worked under a former provincial Government, Ex Company or Ex State Railways and who have been dealt with under the new Note substituted on December 23, 1967 form a class by themselves and therefore there is a reasonable classification of such officers, and that satisfies the requirement of article 14 of the Constitution. On all these grounds, Mr. Setalvad urged that the new Note is not discriminatory and it does not violate article 14 of the Constitution. Mr. R. B. Datar, learned counsel for the respondent and M/s M. K. Ramamurthi and J. Ramamurthi, who appeared for the two interveners have supported the reasoning of the High Court for holding that article 14 is violated by the new Note to cl. (b) of rule 2046. We are of the opinion that the contentions of Mr. Setalvad cannot be accepted. No doubt, the counsel is justified in his contention only to this limited extent, namely, that under cl. (2) of rule 2046, as it existed prior to its amendment on January 11, 1967 that ministerial railway servant falling under that clause, has no right to continue in service beyond the age of 55 and that (1) ; 195. the appropriate authority has the option to continue him in service after his attaining the age of 55 years, subject to the condition that the servant continues to be efficient. This Court in Kailash Chandra 's case(1) had an occasion to consider rule 2046 (2) (a) as it originally stood. It was held that the ministerial railway servants falling under the said clause may be compulsorily retired on attaining the age of 55 years. But when the servant is between the age of 55 and 60 years, the option to continue him in service, subject to the servant continuing to be efficient, exclusively vests with the appropriate authority. It was further laid down that the authority is not bound to retain a railway servant after the age of 55 years, even if the continues to be efficient. It was. further emphasised that the rule gave no right to a ministerial railway servant to continue in service beyond the age of 55 years. It is in view of the above principles laid down by this Court,. we have observed, earlier, that Mr. Setalvad 's contention in respect of the rule 2046, as it originally stood, is well founded. But this Court, in the above decision, had no occasion to consider the problem that now arises, by virtue of the new Note added to, cl. (b) of rule 2046. There is no controversy that after the amalgamation of the Company with the Indian Railway Administration, the respondent has become an employee of the latter. If so, in our opinion, the respondent is entitled to be given the same rights and privileges that are available to the other emplo yees employed by the Indian Railway Administration. That exactly was the position under the rule 2046, as it originally stood; after its amendment on December 5, 1962 increasing the age of retirement to 58 years; as also under the new rule 2046, incorporated on January 11, 1967. All these rules upto and inclusive of January 11, 1967 treated the former employees of the Ex Company, Ex State Railways and former provincial Governments, who were amalgamated with the Indian Railway Administration in 1947, on a par the other original employees of the Indian Railway Administration. In fact, the Note to cl. (b) of rule 2046 incorporated on January 11, 1967, reinforced this position, by making it clear that the expression "Government Service ' 'in cl. (b) will include service under the various employers referred to therein. Mr. Setalvad placed reliance on the fact that rule 2046, as it existed upto and inclusive of January 11, 1967, dealt differently with the age of retirement in respect of : (i) a railway servant coming under cl. (a) and (ii) a ministerial railway servant coming under cl. He further pointed out that even in respect of a ministerial railway servant coming under cl. (b), the latter, in order to be eligible to have a longer age of retirement should be one who complies with the conditions mentioned there 1. ; 196 in. These conditions are as per el. (b) existing on January 1 1, 1967, that the officer should have entered government service on ,or before March 31, 1938. The said officer should also have the ,one or the other of the qualifications mentioned in sub clauses (i)and (ii). That is, according to the learned counsel, if a ministerial railway servant has not entered government service before March 31, 1938, he will not be eligible for the longer age ,of retirement. These circumstances will clearly show, according to Mr. Setalvad that the rule has been through out maintaining a distinction even amongst the ministerial railway servants working under the Indian Railway Administration. This argument, may on the face of it appear to be attractive; but in our opinion, it cannot be accepted. The point to be noted is that though a distinction has been made in the rule between a railway servant coming under el. (a) and a ministerial railway servant coming under el. (b), those clauses will apply uniformly to all members of the Indian Railway Administration depending upon whether .they are railway servants coming under el. (a) or a ministerial railway servant coming under el. (b), as the case may be. To all railway servants coming under el. (a) the age of retirement is the same. Similarly to all ministerial railway servants coming under el. (b), the age of retirement is again the same. Further .if a ministerial railway servant does not satisfy the requirements of cl. (b) he will not be eligible to get the extended period Of retirement. That again will apply to all ministerial railway servants, who do not satisfy the requirements of el. We are emphasising this aspect to show that no distinction has been made either in el. (a) or el. (b) regarding the uniform application in respect of the age of retirement to the officers mentioned ,therein and who are governed by those clauses. That is, there is no inter se distinction made. The distinction made in el. (b) regarding the ministerial railway servants who entered government service on or before March 31, 1938 is again of uniform application. That rule only makes a broad distinction between the ministerial railway servants who entered government service on or before March 31, 1938 and who entered government service after that date. As per the Note to el. (b) to rule 2046, incorporated on January 11, 1967, the respondent is a person who has entered government service on or before March 31, 1938 .and satisfies also the requirements under sub cl. (ii) or el. (b) Similarly, another railway servant may have entered government service under the Indian Railway Administration on or before March 31, 1938. He also, under el. (b) will be a ministerial railway servant who has entered government service on or before March 31, 1938 and if he satisfies one or other of the conditions mentioned in sub clauses (i) and (ii) of el. (b), he will be entitled to continue in service till 60 years. That means both persons, like the respondent, and the officers who have straight 197 joined the service under the Indian Railway Administration, prior March 31, 1938 and who satisfy the requirements under sub clause (i) or sub clause (ii) of clause (b) will be equally entitled continue in service till they attain the age of 60 years. These acts clearly show that cls. (a) and (b) of rule 2046 had uniform application to all the employees of the Indian Railway Administration. Coming to the new rule 2046, incorporated on January 11, 1967, the conditions of service of persons, like the respondent, have been better crystalised. Read with the Note, under cl. (b), the respondent is a ministerial railway servant, who had entered government service on or before March 31, 1938. By virtue of cl. (b), he was entitled to be retained in service till he attains the age of 60 years. It is to be noted that there is no option left with the employer, but to retain such a ministerial railway servant upto 60 years. In other words, if the ministerial railway servant satisfies the requirements of cl. (b), he is, as of right, entitled to be in service, till he attains the age of 60 years. Similarly, cl. (a) introduced on January 11, 1967, gives a right to a railway servant to continue in office, till he attains the age of 58 years. Here again, there is no option vested with the authorities except to continue him till that age. The option to extend the period of service of the officers mentioned in cls. (a) and (b) is dealt with under sub,, clauses (d) and (c) respectively, which we have not quoted. Sub clauses (c) and (d) deal with the granting of extension of service beyond the period mentioned in sub clauses (b) and (a). The option to extend the service beyond the period mentioned in sub causes (a) and (b) may be with the authorities; but they have no voice in a railway servant coming under cl. (b), continuing upto 60 years. That the authorities also understood the position in the manner mentioned above, is clear from the order dated March 31, 1967, of the Divisional Accounts Officer, Hubli declaring the right of the respondent to continue in service upto 60 years. in fact, this order was passed in consequence of the new rule 2046 substituted on January 11 1967. Therefore, from what is stated above, it is clear that upto and inclusive of January 11, 1967, no distinction inter se apart from that made by clauses (a) and (b), between the officers of the Indian Railway Administration, from whatever source they may have come, was made. Even at the risk repetition, we may state that under cl. (b) of rule 2046, as introduced on January 11, 1967, the original employees of the Indian Railway Administration, as well as persons, like the respondent, who came into the Indian Railway Administration in 1947, were both entitled, as of right, to continue in service till they attained the age of 60 years. This position admittedly has been changed, by altering the definition of the 198 ,expression "Government Service" by the new Note to cl. (b) introduced on December 23, 1967. Under that Note, it cannot be gain said, that a distinction has been made between the original employees of the Indian Railway Administration, and the new ,employees, who were amalgamated with the Indian Railway Administration in 1947, but who had their previous service, with either a former provincial Government, or an Ex Company or Ex State Railways. In the case of such employees, the benefit ,of the extended age of retirement, that has been given to the other employees of the Indian Railway Administration, was made available, only if the new 'employees had the same benefit under their previous employers. Therefore, the position is that on and after December 23, 1967, though all the employees are under the Indian Railway Administration, there will be two sets of rules relating to the age of retirement, depending upon the fact whether they were in the original employment of the Indian Railway Administration or on the fact of their coming from one or , the ,other of the employers mentioned in the new Note. It is in consequence of the new Note, that the order dated January 17. 1968 was issued by the Divisional Accounts Officer, Hubli, that the respondent has to retire at the age of 58 years, on April 14, 1968. The question is whether the distinction made under the new Note to cl. (b) substituted on December 23, 1967 valid? In our opinion, such a rule, which makes a distinction between the employees working under the same Indian Railway Administration is not valid. The position, after the new Note was added, is that the employee who had through out been under the Indian Railway Administration is entitled to continue in service till he attains the age of 60 years; whereas the persons, like the respondent, who are also the employees of the Indian Railway Administration, but whose previous services were with the Company, will have to refire at the age of 58 years, because a provision similar to cl. (b) did not exist in the service conditions of the Company. Discrimination, on the face of it, is writ large in the new Note, which is under challenge. Mr. Setalvad, no doubt, urged that the ministerial railway servant, who was originally employee of a Company, Ex State Railway or a former Provincial Government dealt with under the new Note are a class by themselves, and, therefore, there is a reasonable classification. Once the employees dealt with under the new Note, have taken up service under the Indian Railway Administration and have been treated alike upto January 11, 1967, it follows, in our opinion, that they cannot again be classified separately from the other employees of the lndian Railway Administration. Therefore, we are not inclined to accept the 199 contention that the classification of these officers, under the new Note, is a reasonable classification and satisfies one of the essential requisites of article 14 of the Constitution, as interpreted by this Court. We will assume, that in dealing with the types of employees under the new Note, there is a reasonable classification. Nevertheless, the further question arises whether the reasonable classification, with the added condition in the Note incorporated on December 23, 1967, can be said to have a nexus or a relation to the object sought to be achieved by cl. (b) of rule 2046 ? The object of rule 2046 itself is to provide for the age of retirement of the two types of officers coming under cls. (a) and (b). Where there is no indication that any further distinction inter se is sought to be made amongst the officers mentioned in cls. (a) and (b) and when an uniform age of retirement has also been fixed in respect of the officers coming under these two clauses, the classification, carving out the ex employees of the three authorities mentioned therein, with the added condition that the rules of the Company or the State should have a provision similar to clause (b), has, in our opinion, no nexus or relation to the object of the rule. For the reasons given above, we are of the view that the High Court was justified in striking down the order of the Divisional Accounts Officer, Hubli, dated January 17, 1968 directing the respondent to retire from service on April 14, 1968, on which date he will attain the age of 58 years. However, it is not clear from the judgment of the High Court whether the entire new Note substituted under cl. (b) of rule 2046 on December 23, 1967 has been struck down or whether it has struck down only the new condition incorporated in the said Note. Even as per the Note under cl. (b), incorporated along with the new rule 2046 on January 11, 1967, the expression "Government Service" included service rendered in Ex Company, Ex State Railways and in a former provincial Government, and such a provision is beneficial to the employees like the respondent. In the new substituted Note dated December 23, 1967. the first part of the Note including in "government service" any service rendered in a former provincial Government, Ex Company and Ex State Railways is more or less identical with the original Note of January 11, 1967, though in the new Note the order of the former employees has been slightly changed. In our opinion, that part of the new rule providing that for the purpose of cl. (b) the expression "Government Service" includes service rendered in a former provincial Government and in a Ex Company and Ex State Railways can be allowed to stand to this extent. Therefore, the offending part in the new Note are the further words "if the 200 rules of the Company or the State had a provision similar to Clause (b) above". This offending part can be deleted without doing violence to the definition of the expression "Goverment Service" even under the new Note. Therefore, it is only necessary to strike down the offending part in the Note, namely, "if the rules of the Company or the State had a provision similar to Clause (b) above" and this part of the Note alone is struck down as discriminatory and violative of article 14 of the Constitution. Subject to the above directions, the judgment and order of the High Court are confirmed and this appeal dismissed. Special leave to appeal has been granted on August 7, 1969 subject to the conditions that the appellant is to pay the costs of the respondent in any event. The respondent, accordingly, will be entitled to his costs in the appeal. K.B.N. Appeal dismissed.

Rule 2046 (F.R. 56) of the Indian Railway Fundamental Rules was substituted on January 11, 1967, by a new Rule. Undo cl. (b) of the new Rule 2046 every ministerial railway servant who had entered government service on or before March 31, 1938 and who satisfied the conditions mentioned in sub cls. (i) and (ii) of cl. (b) had a right to continue in service till he attained the age of 60 years. The Note to the Rule, defined the expression 'government service ' as including service rendered in ex company and ex State Railway, and in a former provincial government. On December 23, 1967 a new Note was substituted which stated that the expression "government service" ' included "service rendered in a former provincial government and in ex company and ex State Railways, if the rules of the company or the State had a provision similar to cl. (b) above". The respondent joined the service of the Madras and Southern Mahratta Railway company on August 16, 1927. The company was amalgamated with the Indian Railway Administration in 1947 and on such amalgamation the respondent became the employee of the Indian Railway Administration He was a "ministerial servant" within the meaning of that expression in r. 2046. On March 31, 1938, he held a permanent post in the company. After the introduction of r. 2046 on January 11, 1967, the Divisional Accounts Officer passed an order that the respondent was entitled to continue in office till he attained the age of 60 years. But, after the new Note to cl. (b) to r. 2046 was substituted on December 23, 1967, another order was passed to the effect that the respondent was retired from service on April 14, 1968, on attaining the age of 58 years. The order also stated that this action was being taken in view of the new Note substituted on December 12, 1967. The respondent filed a writ petition in the High Court challenging the legality of the order retiring him from service. The High Court struck down the order and gave a declaration that the respondent was entitled to continue in service till he attained the age of 60 years, on the ground that the order was discriminatory and, therefore, violative of article 14 of the Constitution. Dimissing the appeal to this Court, HELD : The High Court was justified in striking down the order directing the respondent to retire from service. (1) Rule 2046 as it stood originally and on January 11, 1967 treated the former employees of the ex company, ex State Railway and former provincial Government 188 who were amalgamated with the Indian Administration in 1947 on a par with the other original employees of the Indian Railway Administration. In fact the Note to cl . (b) of r. 2046 incorporated in January 11, 1967 only reinforced this position. Read with the Note, under el. (b), the respondent is a ministerial servant who had entered government service on or before March 31, 1938 and, therefore, by virtue of el. (b) he was entitled to be retained in service till he attained the age of 60 years. C] (2) Up to and inclusive of January 11, 1967, no distinction, inter se, apart from that made by cls. (a) and (b) between officers of Indian Railway Administration, from whatever source they may have I come, was made. The position admittedly has been changed by altering the definition of the expression "government service" by the new Note to el. (b) Thus on and after December 23, 1967, though all the employees are under the Indian Railway Administration, there will be two sets of rules relating to the age of retirement, depending upon the fact whether they were in the original employment of Indian Railway Administration or on the fact of their coming from one or the other employers mentioned in the new Note. Discrimination, is writ large on the face of the new Note. Once the employees dealt with under the new Note have taken up service under the Indian Railway Administration and have been treated alike up to January 11, 1967, if follows that they cannot again be classified separately from the other employees of the Indian Railway Administration. Therefore the classification of these officers under the new Note is not a reasonable classification. [197 G, 198 F] (3) Assuming there is a reasonable classification, the classification cannot be said to have a nexus or relation to the object sought to be achieved by el. (b) of r. 2046 which is to provide for the age of retirement of the two types of officers coming under cls. (a) and (b). Where there is no indication that any further distinction inter se is sought to be made amongst the officers mentioned in cls. (a) and (b) and when a uniform age of retirement has also been fixed in respect of officers coming under these two clauses, the classification carving out the ex employees of the three authorities mentioned therein with the added condition that the rules of the company or the State should have a provision similar to el. (b) has no nexus or relation to the object of the Rule. [199 B] (4) Though a distinction has been made in the Rule between a railway servant coming under el. (a) and a ministerial railway servant coming under el. (b) in regard to age of retirement, those clauses will apply uniformly to all members of the Indian Railway Administration depending upon whether they are railway servants coming under el. (a) or ministerial railway servants coming under el. The distinction made in el. (b) regarding the ministerial railway servants who entered government service on or before March 31, 1938, is again of uniform application. [196 H] (5) It is only necessary to strike down the offending part in the Note, namely, "if the rules of the company or the State had a provision similar to el. (b)," and this part of the Note alone is struck down as discriminatory and violative of article 14 of the Constitution. [200 B]

Civil Appeal No. 1635 of 1985. From the Judgment and Order dated 21.1.1985 of the Punjab and Haryana High Court in Civil Revision No. 2227 of 1984. V.C. Mahajan, S.K. Bagga and Mrs. S.K. Bagga for the Appellant. R.K. Jain, and Bharat Sangal for the Respondent. The Judgment of the Court was delivered by NATARAJAN, J. This appeal by special leave against a judgment of the High Court of Punjab and Haryana pertains to a contest between a widowed landlady seeking recovery of possession of a leased premises of the residential needs of herself and her sons and daughter on the one hand and an young medical practitioner on the other wanting to continue his medical practice in the premises without being evicted therefrom. The Rent Controller and the Appellate Authority declined to pass an order of eviction in favour of the respondent but the High Court had reversed their judgments and directed eviction and hence the present appeal by spe cial leave by the tenant. One Iqbal Singh, the deceased husband of the respondent was the owner of house No. 16, Sector 18 A, Chandigarh. He leased out the entire portion of the house except a big hall to one Kuldeep Singh on May 27, 1977. Iqbal Singh died in the year 1980 and on 1.4.81, his widow viz. the respondent leased out the hail to the appellant on a monthly rent of Rs.650. The lease was for a period of 11 months. The terms of the lease were reduced to writing but the deed was not registered. The respondent filed two applications more or less concurrently (one on 2.2.82 and the other on 3.2.82) against the tenants of both the portions of the house viz. Kuldeep Singh and the appellant. The eviction of both the tenants was sought for on the same grounds viz., they had changed the user of the premises to non residential purposes and secondly the respondent bona fide required the premises for her own occupation. In addition, in so far as the appellant is concerned, his eviction was also sought for on the ground of default in payment of rent from 1.5.81 onwards. It may be mentioned here that the respondent has three grown up sons and a grown up daughter. During the 557 pendency of the proceedings the size of the family increased to seven members due to the eldest son getting married and begetting a child. The respondent 's husband had been allot ted a Government quarters and after his death the allotment was changed to the name of the eldest son viz. Gurcharanjit Singh who has been examined as AW 2 in the case. The appellant remitted the entire arrears of rent to gether with interest, costs etc. on the first day of the hearing of the case and hence the prayer for eviction on the ground of non payment of rent did not survive for considera tion. As regards the other two grounds the appellant as well as Kuldeep Singh contended that they had not changed the user of the respective portions let out to them and secondly the respondent was in occupation of a government quarters and did not therefore, bona fide require the leased premises for her residence. The Rent Controller and the Appellate Authority held that Kuldeep Singh had changed the user of the premises and ordered his eviction but in so far as the appellant is concerned, both the Authorities found against the respondent on both the grounds and dismissed the action for eviction. Against the order of the Appellate Authority two Revi sion petitions, one by the tenant Kuldeep Singh and the other by the respondent were preferred to the High Court. The High Court dismissed the Revision preferred by Kuldeep Singh and allowed the Revision filed by the respondent and ordered the eviction of the appellant too. While Kuldeep Singh has abided by the order of eviction and surrendered possession to the respondent of the portion leased to him, the appellant has come to this Court to impugn the order of the High Court directing his eviction. Before we enter into the merits of the case, it is relevant to state that the High Court went only into the question of the bona fide requirement of the hall by the respondent for her residential use and did not go into the question whether the appellant had changed the user of the hall by running a clinic and had thereby rendered himself liable for eviction on that ground also. The High Court was of the view that when the respondent 's requirement of the hall was a genuine one, the eviction of the appellant could be ordered on that ground alone and there was no need or necessity to examine the merits of the second ground on which also eviction was sought for. In the light of the arguments advanced by Mr. Mahajan, learned 558 counsel for the appellant, to assail the judgment of the High Court, the questions that fall for consideration can be enunciated as under: 1. Whether the High Court had erred in the exercise of its revisional powers in (a) setting aside the concurrent findings of the Rent Controller and the Appellate Authority that the respondent was not bona fide in need of the hail for her residential use and (b) ignoring the findings of the Rent Controller and the Appellate Authority that the appellant had not changed the user of the hall from residential to non residential purposes and, as such, he cannot be evicted on the ground of mis user of the hall. Whether the High Court has failed to note that in view of the concurrent findings of the Rent Controller and the Appellate Authority that the hall must be deemed to have been let out for a non residential purpose. to wit, running a clinic, the appellant will not be entitled to seek recovery of possession under Section 13(3)(a)(i)(a) of the Act for her residential occupation. We will now take up for consideration the first conten tion of Mr. Mahajan. The Rent Controller and the Appellate Authority have rejected the ease of the respondent that she bona fide required the hail for her residential needs for the following reasons: 1. The Government quarters allotted to the respondent 's son in which the respondent 's family was living consists of three bed rooms and only a nominal rent was being paid for it and hence the accommodation was sufficient and she was not likely to vacate it. The respondent was not likely to occupy the hall after eviction the tenant who was paying an attractive rent of Rs.650 per month. It was inconceivable that the respondent and her family members could manage to live in a single hall when their grievance was that the accommodation in the Government quarters consisting of three bed rooms was insufficient for their requirements. In so far as this finding is concerned, the High Court was refused to give any weight or credence to it, even though it was a concurrent one. In our view, the High Court was fully justified in rejecting the finding of the Rent Controller and the Appellate Authority, even though it is a finding of fact, because both the Authorities have based their findings on conjectures and surmises and secondly because they 559 have lost sight of relevant pieces of evidence which have not been controverted. The evidence of the respondent and her son, which has not been challenged is that the Govern ment Quarters consists of only one bed room, one store, one kitchen and a small dining room and nothing more. Strangely enough the Rent Controller and the Appellate Authority have proceeded on the assumption that the Government Quarters consists of three bed rooms and hence there was enough accommodation for the entire family. It is, therefore obvi ous that they have based their findings on imaginary materi al and not facts. Secondly, both the Authority have taken the erroneous view that the respondent had initiated action only against the appellant to get possession of the hall in the house and had not initiated action to get possession of the other portions of the house from the other tenant. Due to this mistake, the Authorities have disbelieved the re spondent and held that the entire family cannot manage to live in a single hall. They have failed to note that the respondent had contemporaneously initiated proceedings against the other tenant Kuldeep Singh also for recovery of possession of the remaining portion of the house leased to him. Those proceedings were also before the very same Rent Controller and the Appellate Authority and they had them selves ordered the eviction of Kuldeep Singh. The respondent has clearly stated in her evidence as follows: "The house is of single storey. I require the property for my own use and for my children. I require the entire ground floor. I have filed the ejectment petition against the other tenant also. " Her evidence was not and indeed could not be challenged. In spite of all these materials being there, the Rent Control ler and the Appellate Authority have taken a curious view that the respondent and her family members were wanting one hall alone for their residential needs and as such their case was not a believable one. In so far as the doubts entertained about the respondent not beings likely to forego the rent of Rs.650 per month paid by the appellant, the Authorities have failed to give due consideration to the respondent 's statement that her daughter and sons are all fully grown up and she wanted to perform their marriages and as such she was very much in need of the entire house in cluding the hall for her occupation. Having regard to all these vitiating factors, the High Court was fully entitled to reverse the findings of the Rent Controller and the Appellate Authority and examine the case of the respondent and give her relief. The so called findings of fact suffer from inherent defects which deprive them of their binding force on the revisional court. 560 As regards the second limb of the first contention, the Rent Controller and the Appellate Authority have again committed serious errors in rendering their decision on the question whether the appellant had changed the user of the hall from residential to nonresidential purpose. The appel lant rested her case upon the recital in the unregistered lease deed that the hall was let out only for residential purposes and for no other. The Rent Controller refused to look into the lease deed because of its non registration. The Appellate Authority has taken the view that in spite of the non registration, the lease deed can be looked into for collateral purposes out even then the respondent 's case can fare no better, because the respondent has admitted in her evidence that she knew before the hall was let out that the appellant was a doctor and that the purpose of taking the hall on lease was for running a clinic therein and therefore she must be deemed to have acquiesed in the change of user of the hall. The Statutory Authorities have also been influ enced by the fact that the payment of rent of Rs.650 per month was fully indicative that the hall should have been taken on lease for running a clinic. On the basis of such reasoning the Rent Controller and the Appellate Authority have held that the hall must have been let out for non residential purposes only i.e. for running a clinic and hence the charge levelled by the respondent that the appel lant had changed the user of the hall from residential to non residential purpose cannot be sustained. As far as this aspect of the matter is concerned, the Rent Controller and the Appellate Authority have both failed to take note of the pleadings of the appellant. In the written statement, the appellant has averted as follows: "The demised premises were taken by the answering respondent from the petitioner for the purposes of his residence and for running his clinic therein . The answering re spondent is having his residence and clinic in the premises in dispute and is using the same for the said purposes, as such. " However, when the appellant entered the witness box, he gave up the case set out in the written statement and pro pounded a different case that the hall had been taken on lease only for non residential purposes. The perceptible manner in which the appellant had shifted his defence has escaped the notice and consideration of the Statutory Au thorities. Both the Authorities have failed to bear in mind that the pleadings of the parties from the foundation of their case and it is not open to them to give up the case set out in the pleadings and propound a new and different case. Another failing noticed in the judgments of 561 the Rent Controller and the Appellate Authority is that they have been oblivious to the fact that the respondent had leased out the hall to the appellant only for a period of 11 months. Such being the case, even if the respondent had come to know soon after the lease was created that the appellant was using the hall to run a clinic, she may have thought it prudent to let the appellant have his way so that she can recover possession of the hall after 11 months without hitch whereas if she began quarrelling with the appellant for his running a clinic, she would have to be locked up in litiga tion with him for a considerable length of time and can obtain possession of the hall only after succeeding in the litigation. Yet another factor which vitiates the findings of the Rent Controller and the Appellate Authority is that both of them have over looked Section 11 of the Act, and the sustainability of any lease transaction entered in contra vention of Section 11. The legislature, with a view to ensure adequate housing accommodation for the people, has interdicted by means of Section 11 the conversion of resi dential buildings into non residential ones without the written consent of the Rent Controller. Admittedly, in this case the parties had not obtained the consent in writing of the Rent Controller for converting the hall in a residential building into a clinic. Such being the case, the appellant cannot get over the embargo placed by Section 11 by pleading that the respondent was well aware of his running a clinic in the hall and that she had not raised objection at any time to the running of the clinic. Learned counsel for the appellant referred us to the decision in Dr. Gopal Dass Verma vs Dr. S.K. Bharadwaj & Anr., [1962] 2 SCR page 678 and argued that the ratio laid down therein would be fully attracted to the facts of this case. It is true that in the said decision, it was held that when a leased premises was used by the lessee incidently for professional purposes and that too with the consent of the landlord, then the case would go out of the purview of Section 13(3)(e) of the Delhi & Ajmer Rent Control Act 1954 and consequently, the landlord would not be entitled to seek eviction of the tenant on the ground he required the premises for his own residential requirements. We find the facts in that case to be markedly different and it was the speciality of the facts which was largely instrumental in persuading this Court to render its decision in the aforesaid manner. Moreover, the Court had not considered the question whether the conversion of a residential premises into a non residential one without the permission of the Rent Controller was permissible under the Delhi & Ajmer Rent Control Act and if it was not permitted, now far the contravention would affect the rights of the parties. In our opinion, the more relevant decision to be noticed would be Kamal Arora vs Amar Singh & Ors., [1985] SCC (Supplementary) 481 where this Court declined to inter 562 fere with an order of eviction passed in favour of the landlord as the Court was of the view that even if the landlord and the tenant had converted a residential building into a non residential one by mutual consent, it would still be violative of Section 11 of the East Punjab Rent Restric tion Act and therefore, the landlord cannot be barred from seeking recovery of possession of the leased building for his residential needs. We are therefore of the view that the findings of the Rent Controller and the Appellate Authority about the appellant having taken the hall on lease only for running a clinic and that he had not changed the user of the premises have been rendered without reference to the plead ings and without examining the legality of the appellant 's contentions in the light of Section 11 of the Act. We do not therefore think the High Court has committed any error in law in ignoring the findings rendered by the Statutory Authorities about the purpose for which the hall had been taken on lease. Learned counsel for the appellant repeatedly contended that when the Rent Controller and the Appellate Authority have rendered concurrent findings of fact, the High Court was not entitled to disregard those findings and come to a different conclusion of its own and cited in this behalf the decision of this Court in Hiralal Vallabhram vs Sheth Kas turbhai Lalbhai and others, AIR 1967 S.C. 1653. The proposi tion of law put forward by the counsel is undoubtedly a well settled one but then it must be remembered that the rule would apply only where the findings have been rendered with reference to facts and not on the basis of non existent material and baseless assumptions. In this case when the Government quarters occupied by the respondent consists of a single bed room alone, it has been construed as comprising of three bed rooms; when the respondent wanted the entire house to be vacated by the two tenants so that she and her family members can occupy the whole house, the Authorities have proceeded on the basis that the respondent was seeking recovery of possession of one hall alone for her residential needs; when the respondent had not demanded increase of rent, even as per the admission of the appellant, the Au thorities have proceeded on the basis that the respondent was not likely to forego the income derived by way of rent for the hall etc. In such circumstances it is futile to say that the Rent Controller and the Appellate Authority have rendered their findings on the basis of hard and irrefutable facts. On the contrary the findings have been rendered on either non existent or fictitious material. They cannot therefore be construed as findings of fact and once they cease to be findings of fact, they stand denuded of their binding force on the appellate or revisional court. 563 Coming now to the second question, Mr. Mahajan argued that the respondent cannot seek recovery of possession of the hall by means of an application under Section 13(3)(a)(i)(a) because the Rent Controller and the Appellate Authority have found that the hall had been let out only for running a clinic and not for the appellant 's residence. It is true that under the Act, a landlord can apply to the Controller for an order or eviction against a tenant on the ground he requires the building for his own occupation only if the building is a residential one and not if it is a non residential one. Since we have already held that the findings rendered by the Rent Controller and the Appellate Authority about the purpose for which the hall was let out are vitiated by several errors of facts and law, the appel lant is not entitled to rely on those findings and dispute the respondent 's right to seek his eviction under Section 13(3)(a)(i)(a) of the Act. In fact, such a contention was never put forward before the Statutory Authorities or before the High Court. Mr. Mahajan advanced another argument which also had not been urged before the Statutory Authorities or the High Court. He contended that even if the hall had been let out for residential and non residential purposes, the premises would constitute a non residential building as per the amended definition under the East Punjab Rent Restriction (Chandigarh Amendment) Act, 1982, and consequently the respondent cannot seek the eviction of the appellant on the ground she requires the premises for her residential use. The Amendment Act referred to above has enlarged the defini tion of "non residential building", in the parent Act by making "a building let under a single tenancy for use for the purpose of business or trade and also for the purpose of residence" to be also a non residential building. We do not feel persuaded to examine the merit of this contention because it had not been raised before the Rent Controller or the Appellate Authority or the High Court or even in the grounds of appeal in the special leave petition. Moreover, the appellant had given up his case in the written statement that the hall was let out for his residential use as well as for running a clinic and had taken a categoric stand during the enquiry that he had taken the hail on rent only for running his clinic and not for his residential needs as well. Having taken up such a stand the appellant cannot reprobate and contend that the lease of the hail has of a composite nature and as such the benefit of the enlarged definition of a 'non residential building ' given in the Amendment Act would endure to his aid in the case. Mr. Mahajan sought to contend that he was entitled to raise 564 these questions before this court even though they had not been raised before the Statutory Authorities or the High Court, because they are questions of law and can be raised at any time. The learned counsel placed reliance on the decision rendered in Management of the State Bank of Hydera bad vs Vasudev Anant Bhide and others; , to give added weight to his argument. It is true that a pure question of law can be raised for the first time before the High Court or this Court even though the question had not been raised before the Trial Court or the Appellate Court but the position here is that the arguments advanced by the counsel pertain to mixed questions of fact and law. The contentions have been advanced on the assumption that the hall had been leased out for non residential purposes alone or in the case in appeal or revision would amount to apply ing once over again under the Act to seek eviction of a tenant on the ground of bona fide requirement. Over and above all these things, we find that the events which have taken place subsequently, give added force to the decision rendered by the High Court. The eviction proceed ings against the other tenant Kuldeep Singh have ended in favour of the respondent and she has filed affidavits before this Court to state that she has re occupied the portion leased out to Kuldeep Singh. The occupation of a portion of the house by the respondent places her claim for recovery of possession of the hall on a better footing. This is because of the fact the hall does not have an attached bath room or water closet. Consequently the appellant and the patients visiting his clinic are also making use of the common bath room and toilet in the house. This would not only cause inconvenience to the members of the respondent 's family but would also expose them to the risk of infection from the patients using the bath room and toilet during their visit to the appellant 's clinic. Though the appellant has averted in his affidavit that he has only a portable X Ray unit and he does not have a clinical laboratory to carry out blood test, motion test, urine test etc. and that his patients do not make use of the common bathroom and toilet, there are enough averments in the counter affidavits of the alterna tive for residential as well as non residential purposes. Factually the findings on these contentions have been found to be unacceptable. Moreover, the contentions run counter to the legislative direction contained in Section 11 of the Act prohibiting the conversion of a residential building into a nonresidential one without the written consent of the Rent Controller. These factors stand in the way of our accepting the contentions of the appellant 's counsel as being pure questions of law and, therefore, worthy of consideration by us in the appeal. 565 It was lastly contended by Mr. Mahajan that as per the second proviso to Section 13(3)(a) the respondent is not entitled to apply once over again for eviction of a tenant on the ground of bona fide requirement for owner 's occupa tion after having obtained an earlier order on the same ground. According to Mr. Mahajan inasmuch as the respondent has obtained an order of eviction against Kuldeep Singh she is precluded by the proviso from seeking eviction of the appellant too on the ground of bona fide requirement. We do not find any merit in this judgment because it does not take note of relevant facts. We have already stated that the eviction proceedings were initiated against both the tenants concurrently and not after an interval of time. As such merely because the respondent succeeded in one of the peti tions and failed in the other, it cannot be argued that the continuation of the proceedings in that respondent and material in the photos produced by her of the same board of the appellant 's clinic to show that he does have a clinical laboratory in the hall in question. It does not require much to see that at least some of the patients visiting the appellant 's clinic would be making use of the common bath room and toilet and this would certainly cause great incon venience to the occupants of the house. Hence the respondent will be fully justified in asking for the eviction of the appellant from the hall let out to him. For all these reasons, we do not find any merit in the contentions of the appellant. As we have already stated the findings of the Rent Controller and the Appellate Authority are vitiated by the inherent defects in them and the High Court was, therefore, justified in taking the view that the findings have no binding force on the revisional court. In the result the appeal fails and will stand dismissed. The parties are directed to bear their respective costs. In order to enable the appellant to secure alternate accommodation for shifting his clinic he is granted time till 31.1.0.1987 to vacate the premises subject to the condition he files an undertaking in the usual terms within three weeks from today failing which the respondent will be entitled to recover possession in terms of the judgment and decree of the High Court. P.S.S. Appeal dismissed.

The deceased husband of the respondent leased out the entire portion of his house, except a big hall, to tenant in Chandigarh. He was then putting up in a Government quarter. After his death, his widow the respondent, leased out the hall to the appellant on April 1, 1981 for a period of 11 months on a monthly rent of Rs.650. The Government quarter which had been allotted to her husband was transferred to the name of her eldest son. The respondent filed two applications, more or less concurrently, in February 1982 against tenants of both the portions of the house seeking their eviction oh grounds that they had changed the user of the premises to non residential purposes, and that she bona fide required the premises for her own use and occupation. The Rent Controller and the Appellate Authority held that the first tenant had changed the user of the premises and ordered his eviction. Insofar as the appellant was concerned, both the authorities found against the respondent on both the grounds and dismissed the action for eviction. The High Court dismissed the revision preferred by the first tenant, but allowed the one filed by the respondent and ordered the eviction of the second tenant too. The first tenant abided by the order of eviction and surrendered possession to the respondent. The second tenant, however, appealed by special leave to this 553 Court. It was contended that when the Rent Controller and the Appellate Authority have rendered concurrent findings of the fact, the High Court was not entitled to disregard those findings, and come to a different conclusion of its own, that the respondent could not seek recovery of possessing of the hail by means of an application under section 13(3)(a) (i)(a) of the East Punjab Rent Restriction Act, 1949 for residen tial use because even of the hail had been let out for residential and nonresidential purposes, the premises would constitute a non residential building as per the amended definition under the East Punjab Rent Restriction (Chandi garh Amendment) Act, 1982, that he was entitled to raise these questions though they had not been raised earlier because they were questions of law, that as per the second proviso to section 13(3)(a) of the Act the respondent was not entitled to apply once over again for eviction of a tenant on the ground of bona fide requirement after having obtained an earlier order on the same ground. Dismissing the appeal, HELD: 1.1 The findings of the Rent Controller and the Appellate Authority are vitiated by inherent defects. The High Court was, therefore, justified in taking the view that those findings have no binding force on the revisional court. [565E] 1.2 The rule that when the courts of fact render concur rent findings of fact, the High Court would not be entitled to disregard those findings and come to a different conclu sion of its own, would apply where the findings have been rendered with reference to facts. In the instant case, both the statutory authorities have based their findings on conjectures and surmises and lost sight of relevant pieces of evidence which have not been controverted. When the evidence of the respondent and her son, which has not been challenged, was that the Government quarter consisted of only one bed room, one store, one kitchen and one small dining room and nothing more, it has been construed by the authorities as comprising of three bed rooms and held that as there was enough accommodation for the entire family she was not likely to vacate it. When the respondent wanted the entire house to be vacated by the two tenants so that she and her family members could occupy the whole house, the authorities have proceeded on the basis that the respondent was seeking recovery of possession of one hail alone for her residential needs and held that the entire family could not manage to live in a single hail. They have failed to take note that the respondent had con temporaneously initiated proceedings against the 554 other tenant also for recovery of possession of the remain ing portion of the house leased to him. Those proceedings were also before the very same Rent Controller and the Appellate Authority and they themselves had ordered the eviction of the other tenant. The respondent had clearly stated in her evidence that she required the property for her own use and for her children and that she had filed the ejectment petition against the other tenant also. That evidence was not and indeed could not be challenged. When the respondent had not demanded increase of rent, even as per the admission of the appellant, the authorities have proceeded on the basis that the respondent was not likely to forego the income derived by way of rent for the hall. They have failed to give due consideration to the respondent 's statement that her daughter and sons were all fully grown up and she wanted to perform their marriages and as such she was very much in need of the entire house, including the hall, for her occupation. All these findings have been rendered on either non existent or fictitious material. They cannot, therefore, be construed as findings of fact and once they cease to be findings of fact, they stand denuded of their binding force on the appellate or revisional court. [558H; 559A H] Hiralal Vallabhrara vs Sheth Kasturbhai Lalbhai and others, AIR 1967 S.C. 1653, referred to. 2.1 The finding rendered by the Rent Controller and the Appellate Authority about the purpose for which the hall was let out were vitiated by several errors of fact and law. The appellant, therefore, was not entitled to rely on those findings and dispute the respondent 's right to seek his eviction under section 13(3)(a)(i)(a) of the Act. [563C] 2.2 The pleadings of the parties form the foundation of their case and it is not open to them to give up the case set out in the pleadings and propound a new and different case. [560H] In the instant case, the tenant had averred in his written statement that the hall was taken by him for the purpose of his residence and for running his clinic but when he entered the witness box he propounded a different case that the hall had been taken on lease only for non residen tial purposes. The statutory authorities failed to notice the perceptible manner in which the appellant had shifted his defence. [560G] 2.3 Yet another factor which vitiates the findings of the statutory authorities is that both of them have over looked section 11 of the Act and the sustainability of any lease transaction entered in contravention of that 555 provision which interdicts conversion of residential build ings into nonresidential ones without the written consent of the Rent Controller. [561C D] In the instant case the parties had not obtained the consent in writing of the Rent Controller for converting the hall in a residential building into a clinic. Such being the case the appellant cannot get over the embargo placed by section 11 by pleading that the respondent was well aware of his running a clinic in the hall and that she had not raised objection at any time to the running of the clinic. [561D E] Kamal Arora vs Amar Singh & Ors., [1985] SCC (Supplemen tary) 481, referred to. Dr. Gopal Dass Verma vs Dr. S.K. Bhardwaj & Anr., [1962] 2 SCR page 678, distinguished. Having taken a categoric stand during the enquiry that he had taken the hail on rent only for running his clinic and not for his residential needs as well, the appel lant cannot reprobate and contend that the lease of the hall was of a composite nature, to seek the benefit of the en larged definition of a 'non residential building ' given in the Amendment Act. A pure question of law can be raised for the first time before the High Court or the Supreme Court even though the question had not been raised before the trial court or the appellate court. But in the instant case, the conten tions advanced by the counsel on the nature of user of the hail pertain to mixed questions of fact and law. Moreover these contentions run counter to the legislative direction contained in section 11 of the Act prohibiting conversion of a residential building into a non residential one without the written consent of the Rent Controller. These contentions cannot, therefore be said to be pure questions of law. Management of the State of Bank of Hyderabad vs Vasudev Anant Bhide and others; , , referred to. The eviction proceedings were initiated by the re spondent against both the tenants concurrently and not after an interval of time. As such, merely because the respondent succeeded in one of the petitions and failed in the other it cannot be said that the continuation of the proceedings in that case in appeal or revision would amount to applying once over again under the Act to seek eviction of a tenant on the ground of bona fide requirement.

Civil Appeal No. 346 of 1958. 452 Appeal by special leave from the judgment and order dated May 10, 1955, of the former Madhya Bharat High Court in Misc. Appeal No. 26 of 1954. section N. Andley, Rameshwar Nath and P. L. Vohra, for the appellant. section T. Desai, K. B. Bhatt and B. R. L. Iyengar, for the respondent. November 16. The Judgment of Wanchoo, Das Gupta and Dayal,JJ., was delivered by Dayal J. Shah J., delivered a separate Judgment. RAGHUBUR DAYAL, J. The appellant and the respondent entered into a partnership at Indore for working coal mines at Kajora gram (District Burdwan) and manufacture of cement etc. , in the name and style of 'Diamond Industries '. The head office of the partnership was at Indore. The partnership was dissolved by a deed of dissolution dated August 22, 1945. Under the terms of this deed, the appellant made himself liable to render full, correct and true account of all the moneys advanced by the respondent and also to render accounts of the said partnership and its business, and was held entitled to 1/4th of Rs. 4,00,000/ solely contributed by the respondent toward the capital of the partnership. He was, however, not entitled to get this amount unless and until he had rendered the accounts and they had been checked and audited. The second proviso at the end of the convenants in the deed of dissolution reads: "Provided however and it is agreed by and between the parties that as the parties entered into the partnership agreement at Indore (Holker State) all disputes and differences whether regarding money or as to the relationship or as to their rights and liabilities of the parties hereto in respect of the 453 partnership hereby dissolved or in respect of question arising by and under this document shall be decided amicably or in court at Indore and at nowhere else." On September 29, 1945, a registered letter on behalf of the respondent was sent to the appellant. This required the appellant to explain to and satisfy the respondent at Indore as to the accounts of the said colliery within three months of the receipt of the notice. It was said in the notice that the accounts submitted by the appellant had not been properly kept and that many entries appeared to be wilfully falsified, evidently with malafide intentions and that there appeared in the account books various false and fictitious entries causing wrongful loss to the respondent and wrongful gain to the appellant. The appellant sent a reply to this notice on December 5, 1935, and denied the various allegations, and requested the respondent to meet him at Asansol or Kajoraram on any day suitable to him, within ten days from the receipt of that letter. On August 18, 1948, the appellant instituted Suit M. section No. 33 of 1948 in the Court of the Subordinate Judge at Asansol against the respondent for the recovery of Rs. 1,00,000/ on account of his share in the capital and assests of the partnership firm 'Diamond Industries ' and Rs. 18,000/ as interest for detention of the money or as damages or compensation for wrongful withholding of the payment. In the plaint he mentioned about the respondent 's notice and his reply and to a second letter on behalf of the respondent and his own reply thereto. A copy of the deed of dissolution, according to the statement in paragraph 13 of the plaint, was filed along with it. On October 27, 1948, respondent filed a petition under section 34 of the Arbitration Act in the Asansol Court praying for the stay of the suit in 454 view of the arbitration agreement in the original deed of partnership. This application was rejected on August 20, 1949. Meanwhile, on January 3, 1949, the respondent filed Civil Original Suit No. 71 of 1949 in the Court of the District Judge, Indore, against the appellant, and prayed for a decree for Rs. 1,90,519 0 6 against the appellant and further interest on the footing of settled accounts and in the alternative for a direction to the appellant to render true and full accounts of the partnership. On November 28, 1949, the respondent filed his written statement in the Asansol Court. Paragraphs 19 and 21 of the written statement are: "19. With reference to paragraph 21 of the plaint, the defendant denies that the plaintiff has any cause of action against the defendant or that the alleged cause of action, the existence of which is denied, arose at Kajora Colliery. The defendant craves reference to the said deed of dissolution whereby the plaintiff and the defendant agreed to have disputes, if any, tried in the Court at Indore. In the circumstances, the defendant submits that this Court has no jurisdiction to try and entertain this suit. The suit is vexatious, speculative, oppressive and is instituted malafide and should be dismissed with costs. " Issues were struck on February 4, 1950. The first two issues are: "1. Has this Court jurisdiction to entertain and try this suit? 2. Has the plaintiff rendered and satisfactorily explained the accounts of the partnership in terms of the deed of dissolution of partnership ?" 455 In December 1951, the respondent applied in the Court at Asansol for the stay of that suit in the exercise of its inherent powers. The application was rejected on August 9, 1952. The learned Sub Judge held: "No act done or proceedings taken as of right in due course of law is 'an abuse of the process of the Court ' simply because such proceeding is likely to embarass the other party." He therefore held that there could be no scope for acting under section 151, Code of Civil Procedure, as section 10 of that Code had no application to the suit, it having been instituted earlier than the suit at Indore. The High Court of Calcutta confirmed this order on May 7, 1953, and said: "We do not think that, in the circumstance of these cases and on the materials on record, those orders ought to be revised. We would not make any other observation lest it might prejudice any of the parties. " The High Court further gave the following direction: "As the preliminary issue No.1 in the two Asansol suits have been pending for over two years, it is only desirable that the said issues should be heard out at once. We would, accordingly, direct that the hearing of the said issues should be taken up by the learned Subordinate Judge as expeditiously as possible and the learned Subordinate Judge will take immediate steps in that direction. " Now we may refer to what took place in the Indore suit till then. On April 28, 1950, the appellant applied to the Indore Court for staying that suit under sections 10 and 151 Code of Civil Procedure. 456 The application was opposed by the respondent on three grounds. The first ground was that according to the term in the deed of dissolution, that Court alone could decide the disputes. The second was that under the provisions of the Civil Procedure Code in force in Madhya Bharat, the court at Asansol was not an internal Court and that the suit filed in Asansol Court could not have the effect of staying the proceedings of that suit. The third was that the two suits were of different nature, their subject matter and relief claimed being different. The application for stay was rejected on July 5, 1951. The Court mainly relied on the provisions of the Second proviso in the deed of dissolution. The High Court of Madhya Bharat confirmed that order on August 20, 1953. The position then, after August 20, 1953, was that the proceedings in both the suits were to continue, and that the Asansol Court had been directed to hear the issue of jurisdiction at an early date. It was in these circumstances that the respondent applied under section 151, Code of Civil Procedure on September 14, 1953, to the Indore Court, for restraining the appellant from continuing the proceedings in the suit filed by him in the Court at Asansol. The respondent alleged that the appellant filed the suit at Asansol in order to put him to trouble, heavy expenses and wastage of time in going to Asansol and that he was taking steps for the continuance of the suit filed in the Court of the Subordinate Judge of Asansol. The appellant contested this application and stated that he was within his rights to institute the suit at Asansol, that that Court was competent to try it and that the point had been decided by overruling the objections raised by the respondent and that the respondent 's objection for the stay or 457 proceedings in the Court at Asansol had been rejected by that Court. He denied that his object in instituting the suit was to cause trouble and heavy expenses to the respondent. It may be mentioned that the respondent did not state in his application that his application for the stay of the suit at Asansol had been finally dismissed by the High Court of Calcutta and that that Court had directed the trial Court to decide the issue of jurisdiction at an early date. The appellant, too, in his objection, did not specifically state that the order rejecting the respondents 's stay application had been confirmed by the High Court at Calcutta and that that Court had directed for an early hearing of the issue of jurisdiction. The learned Additional District Judge, Indore, issues interim injunction under O. XXXIX, Code of Civil Procedure, to the appellant restraining him from proceeding with his Asansol suit pending decision of the Indore suit, as the appellant was proceeding with the suit at Asansol in spite of the rejection of his application for the stay of the suit at Indore, and , as the appellant wanted to violate the provision in the deed of dissolution about the Indore Court being the proper forum for deciding the dispute between the parties. Against this order, the appellant went in appeal to the High Court of Judicature at Madhya Bharat, contending that the Additional District Judge erred in holding that he was competent to issue such an interim injunction to the appellant under O. XXXIX of the Code of Civil Procedure and that it was a fit case for the issue of such an injunction and that, considering the provisions of O. XXXIX, the order was without jurisdiction. The High Court dismissed the appeal by its order dated May 10, 1955. The learned Judges agreed with the contention that O. XXXIX, r. 1 did not 458 apply to the facts of the case. They, however, held that the order of injunction could be issued in the exercise of the inherent powers of the Court under section 151, C.P.C. It is against this order that the appellant has preferred this appeal, by special leave. On behalf of the appellant, two main questions have been raised for consideration. The first is that the Court could not exercise its inherent powers when there were specific provisions in the Code of Civil Procedure for the issue of interim injunctions, they being section 94 and O.XXXIX. The other question is whether the Court, in the exercise of its inherent jurisdiction, exercised its discretion properly, keeping in mind the facts of the case. The third point which came up for discussion at the hearing related to the legal effect of the second proviso in the deed of dissolution on the maintainability of the suit in the Court at Asansol. We do not propose of express any opinion on this question of jurisdiction as it is the subject matter of an issue in the suit at Asansol and also in the suit at Indore and because that issue had not yet been decided in any of the two suits. On the first question it is argued for the appellant that the provisions of cl. (c) of section 94, Code of Civil Procedure make it clear that interim injunctions can be issued only if a provisions for their issue is made under the rules, as they provide that a Court may, if it is so prescribed, grant temporary injunctions in order to prevent the ends of justice from being defeated, that the word 'prescribed ', according to section 2, means 'prescribed by rules ' and that rr. 1 and 2 of O.XXXIX lay down certain circumstances in which a temporary injunction may be issued. There is difference of opinion between the High Court on this point. One view is that a Court 459 cannot issue an order of temporary injunction if the circumstances do not fall within the provisions of Order XXXIX of the Code: Varadacharlu vs Narsimha Charlu (1), Govindarajulu vs Imperial Bank of India (2), Karuppayya vs Ponnuswami (3), Murugesa Mudali vs Angamuthu Mudali (4) and Subramanian vs Seetarama (5). The other view is that a Court can issue an interin injunction under circumstances which are not covered by Order XXXIX of the Code, if the Court is of opinion that the interests of justice require the issue of such interin injunction: Dhaneshwar Nath vs Ghanshyam Dhar (6), Firm Bichchha Ram vs Firm Baldeo Sahai (7),Bhagat Singh vs jagbir Sawhney (8) and Chinese Tannery owners ' Association vs Makhan Lal (9). We are of opinion that the latter view is correct and that the Courts have inherent jurisdiction to issue temporary injunctions in circumstances which are not covered by the provisions of O.XXXIX, Code of Civil Procedure. There is no such expression in section 94 which expressly prohibits the issue of a temporary injunction in circumstances not covered by O. XXXIX or by any rules made under the Code. It is well settled that the provisions of the Code are not exhaustive for the simple reason that the Legislature is incapable of contemplating all the possible circumstances which may arise in future litigation and consequently for providing the procedure for them. The effect of the expression 'if it is so prescribed ' is only this that when the rules prescribe the circumstances in which the temporary injunction can be issued, ordinarily the Court is not to use its inherent powers to make the necessary orders in the interests of justice, but is merely to see whether the circumstances of the case bring it within the prescribed rule. if the provisions of section 94 460 were not there in the Code, the Court could still issue temporary injunctions, but it could do that in the exercise of its inherent jurisdiction. No party has a right to insist on the Court 's exercising that jurisdiction and the Court exercises its inherent jurisdiction only when it considers it absolutely necessary for the ends of justice to do so. it is in the incidence of the exercise of the power of the Court to issue temporary injunction that the provisions of section 94 of the Code have their effect and not in taking away the right of the Court to exercise its inherent powers. There is nothing in O. XXXIX, rr. 1 and 2, which provide specifically that a temporary injunction is not to be issued in cases which are not mentioned in those rules. The rules only provide that in circumstances mentioned in them the Court may grant a temporary injunction. Further, the provisions of section 151 of the Code make it clear that the inherent powers are not controlled by the provisions of the Code. Section 151 reads: "Nothing in this Code shall be deemed to limit or otherwise affect the inherent power of the Court to make such orders as may be necessary for the ends of the justice or to prevent abuse of the process of the Court. " A similar question about the powers of the Court to issue a commission in the exercise of its powers under section 151 of the Code in circumstances not covered by section 75 and Order XXVI, arose in Padam Sen vs The State of Uttar Pradesh (1) and this Court held that the Court can issue a commission in such circumstances. It observed at page 887 thus: "The inherent powers of the Court are in addition to the powers specifically conferred on 461 the Court by the Code. They are complementary to those powers and therefore it must be held that the Court is free to exercise them for the purpose mentioned in section 151 of the Code when the exercise of those powers is not in any way in conflict with what has been expressly provided in the Code or against the intentions of the Legislature. " These observations clearly mean that the inherent powers are not in any way controlled by the provisions of the Code as has been specifically stated in 151 itself. But those powers are not to be exercised when their exercise may be in conflict with what had been expressly provided in the Code or against the intentions of the Legislature. This restriction, for practical purposes, on the exercise of these powers is not because these powers are controlled by the provisions of the Code but because it should be presumed that the procedure specifically provided by the Legislature for orders in certain circumstances is dictated by the interests of justices. In the above case, this Court did not uphold the order of the Civil Court, not coming under the provisions of order XXVI, appointing a commissioner for seizing the account books of the plaintiff on the application of the defandants. The order was held to be defective not because the Court had no power to appoint a commissioner in circumstances not covered by section 75 and O. XXVI, but because the power was exercised not with respect to matters of procedure but with respect to a matter affecting the substantive rights of the plaintiff. This is clear from the further observations made at page 887. This Court said: "The question for determination is whether the impugned order of the Additional Munsif appointing Shri Raghubir Pershad Commissioner for seizing the plaintiff 's books of account 462 can be said to be an order which is passed by the Court in the exercise of its inherent powers. The inherent powers saved by section 151 of the Code are with respect to the procedure to be followed by the Court in deciding the cause before it. These powers are not powers over the substantive rights which any litigant possesses. Specific powers have to be conferred on the Courts for passing such orders which would affect such rights of a party. Such powers cannot come within the scope of inherent powers of the Court in matters of procedure, which powers have their source in the Court possessing all the essential powers to regulate its practice and procedure. " The case reported as Maqbul Ahmad Pratap Narain Singh does not lay down that the inherent powers of the Court are controlled by the provisions of the Code. It simply holds that the statutory discretion possessed by a Court in some limited respects under an Act does not imply that the Court possesses a general discretion to dispense with the provisions of that Act. In that case, an application for the preparation of a final decree was presented by the decree holder beyond the period of limitation prescribed for the presentation of such an application. It was however contended that the Court possessed some sort of judicial discretion which would enable it to relieve the decree holder from the operation of the Limitation Act in a case of hardship. To rebut this contention, it was said at page 87: "It is enough to say that there is no authority to support the proposition contended for. In their Lordships ' opinion it is impossible to hold that, in a matter which is governed by Act, an Act which in some limited respects gives the Court a statutory discretion, there can be 463 implied in the Court, outside the limits of the Act, a general discretion to dispense with its provisions. It is to be noted that this view is supported by the fact that section 3 of the Act is peremptory and that the duty of the Court is to notice the Act and give effect to it, even though it is not referred to in the pleadings". These observations have no bearing on the question of the Court 's exercising its inherent powers under section 151 of the Code. The section itself says that nothing in the Code shall be deemed to limit or otherwise affect the inherent power of the Court to make orders necessary for the ends of justice. In the face of such a clear statement, it is not possible to hold that the provisions of the Code control the inherent power by limiting it or otherwise affecting it. The inherent power has not been conferred upon the Court; it is a power inherent in the Court by virtue of its duty to do justice between the parties before it. Further, when the Code itself recognizes the existence of the inherent power of the Court, there is no question of implying any powers outside the limits of the Code. We therefore repel the first contention raised for the appellant. On the second question, we are of opinion that in view of the facts of the case, the Courts below were in error in issuing a temporary injunction to the appellant restraining him from proceeding with the suit in the Asansol Court. The inherent powers are to be exercised by the Court in very exceptional circumstances, for which the Code lays down no procedure. The question of issuing an order to a party restraining him from proceeding with any other suit in a regularly constituted Court of law deserves 464 great care and consideration and such an order is not to be made unless absolutely essential for the ends of justice. In this connection, reference may usefully be made to what was said in Cohen vs Rothfield (1) and which case appears to have influenced the decision of the Courts in this country in the matter of issuing such injunction orders. Scrutton, L. J., said at page 413: "Where it is proposed to stay an action on the ground that another is pending, and the action to be stayed is not in the Court asked to make the order, the same result is obtained by restraining the person who is bringing the second action from proceedings with it. But, as the effect is to interfere with proceedings in another jurisdiction, this power should be exercised with great caution to avoid even the appearance of undue interference with another Court". And again, at page 415: "While, therefore, there is jurisdiction to restrain a defendant from suing abroad, it is a jurisdiction very rarely exercised, and to be resorted to with great care and on ample evidence produced by the applicant that the action abroad is really vexatious and useless." The principle enunciated for a plaintiff in a earlier instituted suit to successfully urge a restraint order against a subsequent suit instituted by the defendant, is stated thus in this case, at page 415: "It appears to me that unless the applicant satisfies the Court that no advantage can be gained by the defendant by proceeding with the action in which he is plaintiff in another part of the King 's dominions, the Court should not stop him from proceeding 465 with the only proceedings which he, as plaintiff, can control. The principle has been repeatedly acted upon. " The injunction order in dispute is not based on any such principle. In fact, in the present case, it is the defendant of the previously instituted suit that has obtained the injunction order against the plaintiff of the previously instituted suit. The considerations which would make a suit vexatious are well explained in Hyman vs Helm (1). In that case, the defendant, in an action before the Chancery Division of the High Court brought an action against the plaintiffs in San Francisco. The plaintiffs, is an action in England, prayed to the Court to restrain the defendants from proceeding further with the action in San Francisco. It was contended that it was vexatious for the defendants to bring the action in San Francisco as the witnesses to the action were residents of England, the contract between the parties was an English contract and that its fulfilment took place is England. In repelling the contention that the defendants ' subsequent action in San Francisco was vexatious, Brett, M. R., said at page 537: "If that makes an action vexatious it would be a ground for the interference of the Court, although there were no action in England at all, the ground for alleging the action in San Francisco to be vexatious being that it is brought in an inconvenient place. But that is not the sort of vexation on which an English Court can act. It seems to me that where a party claims this interference of the Court to stop another action between the same parties, it lies upon him to shew to the Court that the multiplicity of actions is vexatious, and that the whole burden of proof lies upon him. He does not satisfy that burden of proof by merely she 466 wing that there is a multiplicity of actions, he must go further. If two actions are brought by the same plaintiff against the same defendant in England for the same cause of action, then, as was said in Mchonry vs Lewis and the case of the Peruvian Guano Company vs Bockwoldt (23 Ch. D. 225), prima facie that is vexatious, and therefore the party who complains of such a multiplicity of actions had made out a prima facie case for the interference of the Court. Where there is an action by a plaintiff in England, and a crossaction by a defendant in England, whether the same prima facie case of vaxation arises is a much more difficult point to decide and I am not prepared to say that it does. " It should be noticed that this question for an action being vexatious was being considered with respect to the subsequent action brought by the defendant in the previously instituted suit and when the restraint order was sought by the plaintiff of the earlier suit. In the case before us, it is the plaintiff of the subsequent suit who seeks to restrain the plaintiff of the earlier suit from proceeding with his suit. This cannot be justified on general principles when the previous suit has been instituted in a competent Court. The reasons which weighed with the Court below for maintaining the order of injunction may be given in its own words as follows: "In the plaint filed in the Asansol Court the defendant has based his claim on the deed of dissolution dated 22, 1945, but has avoided all references to the provisions regarding the agreement to place the disputes before the Indore Courts. It was an action taken by the present defendant in anticipation of the present suit and was taken in flagrant breach 467 of the terms of the contract. In my opinion, the defendant 's action constitutes misuse and abuse of the process of the Court. " The appellant attached the deed of dissolution to the plaint he filed at Asansol. Of course, he did not state specifically in the plaint about the proviso with respect to the forum for the decision of the dispute. Even if he had mentioned the term, that would have made no difference to the Asansol Court entertaining the suit, as it is not disputed in these proceedings that both the Indore and Asansol Courts could try the suit in spite of the agreement. The appellant 's institution of the suit at Asansol cannot be said to be in anticipation of the suit at Indore, which followed it by a few months. There is nothing on the record to indicate that the appellant knew, at the time of his instituting the suit, that the respondent was contemplating the institution of a suit at Indore. The notices which the respondent gave to the appellant were in December 1945. The suit was filed at Asansol in August 1948, more than two years and a half after the exchange of correspondence referred to in the plaint filed at Asansol. In fact, it is the conduct of the respondent in applying for the injunction in September 1953, knowing full well of the order of the Calcutta High Court confirming the order refusing stay of the Asansol suit and directing that Court to proceed with the decision of the issue of jurisdiction at an early date, which can be said to amount to an abuse of the process of the Court. It was really in the respondent 's interest if he was sure of his ground that the issue of jurisdiction be decided by the Asansol Court expeditiously, as ordered by the Calcutta High Court in May 1953. If the Asansol Court had clearly no jurisdiction to try the suit in view of the terms of the deed of dissolution, the decision of that issue 468 would have finished the Asansol suit for ever. He, however, appears to have avoided a decision of that issue from that Court and, instead of submitting to the order of the Calcutta High Court, put in this application for injunction. It is not understandable why the appellant did not clearly state in his objection to the application what the High Court of Calcutta had ordered. That might have led the consideration of the question by the Indore Court in a different perspective. It is not right to base an order of injunction, under section 151 of the Code, restraining the plaintiff from proceeding with his suit at Asansol, on the consideration that the terms of the deed of dissolution between the parties make it a valid contract and the institution of the suit at Asansol is in breach of it. The question of jurisdiction of the Asansol Court over the subject matter of the suit before it will be decided by that Court. The Indore Court cannot decide that question. Further, it is not for the Indore Court to see that the appellant observes the terms of the contract and does not file the suit in any other Court. It is only in proper proceedings when the Court considers alleged breach of contract and gives redress for it. For the purposes of the present appeal, we assume that the jurisdiction of the Asansol Court is not ousted by the provisions of the proviso in the deed of dissolution, even though that proviso expresses the choice of the parties for having their disputes decided in the Court at Indore. The appellant therefore could choose the forum in which to file his suit. He chose the Court at Asansol, for his suit. The mere fact that Court is situate at a long distance from the place of residence of the respondent is not sufficient to establish that the suit has been filed in that Court in order to put the respondent to trouble and harassment and to unnecessary expense. 469 It cannot be denied that it is for the Court to control the proceedings of the suit before it and not for a party, and that therefore, an injunction to a party with respect to his taking part in the proceedings of the suit would be putting that party in a very inconvenient position. It has been said that the Asansol Court would not act in a way which may put the appellant in a difficult position and will show a spirit of cooperation with the Indore Court. Orders of Court are not ordinarily based on such considerations when there be the least chance for the other Court not to think in that way. The narration of facts will indicate how each Court has been acting on its own view of the legal position and the conduct of the parties. There have been case in the past, though few, in which the Court took no notice of such injunction orders to the party in a suit before them. They are: Menon vs Parvathi Ammal(1), Harbhagat Kaur vs Kirpal Singh (2) and Shiv Charan Lal vs Phool Chand (3). In the last case, the Agra Court issued an injunction against the plaintiff of a suit at Delhi restraining him from proceeding with that suit. The Delhi Court, holding that the order of the Agra Court did not bind it, decided to proceed with the suit. This action was supported by the High Court. Kapur J., observed at page 248: "On the facts as have been proved it does appear rather extra ordinary that a previously instituted suit should be sought to be stayed by adopting this rather extraordinary procedure. " It is admitted that the Indore Court could not have issued an induction or direction to the Asansol Court not to proceed with the suit. The effect of issuing an injunction to the plaintiff of the 470 suit at Asansol, indirectly achieves the object which an injunction to the Court would have done. A court ought not to achieve indirectly what it cannot do directly. The plaintiff, who has been restrained, is expected to bring the restraint order to the notice of the Court. If that Court, as expected by the Indore Court, respects the injunction order against the appellant and does not proceed with the suit, the injunction order issued to the appellant who is the plaintiff in that suit is as effective an order for arresting the progress of that suit as an injunction order to the Court would have been. If the Court insists on proceeding with the suit, the plaintiff will have either to disobey the restraint order or will run the risk of his suit being dismissed for want of prosecution. Either of these results is a consequence which an order of the Court should not ordinarily lead to. The suit at Indore which had been instituted later, could be stayed in view of section 10 of the Code. The provisions of that section are clear, definite and mandatory. A Court in which a subsequent suit has been filed is prohibited from proceeding with the trial of that suit in certain specified circumstances. When there is a special provision in the Code of Civil Procedure for dealing with the contingencies of two such suits being instituted, recourse to the inherent powers under section 151 is not justified. The provisions of section 10 do not become inapplicable on a Court holding that the previously instituted suit is a vexatious suit or has been instituted in violation of the terms of the contract. It does not appear correct to say, as has been said in Ram Bahadur vs Devidayal Ltd. (1) that the Legislature did not contemplate the provisions of section 10 to apply when the previously instituted suit be held to be instituted in those circumstances. The provisions of section 35A indicate that the Legislature was aware of false or vexatious claims or defences 471 being made, in suits, and accordingly provided for compensatory cost. The Legislature could have therefore provided for the non application of the provisions of section 10 in those circumstances, but it did not. Further, section 22 of the Code provides for the transfer of a suit to another Court when a suit which could be instituted in any one of two or more Courts is instituted in one of such Courts. In view of the provisions of this section, it was open to the respondent to apply for the transfer of the suit at Asansol to the Indore Court and, if the suit had been transferred to the Indore Court, the two suits could have been tried together. It is clear, therefore, that the Legislature had contemplated the contingency of two suits with respect to similar reliefs being instituted and of the institution of a suit in one Court when it could also be instituted in another Court and it be preferable, for certain reasons, that the suit be tried in that other Court. In view of the various considerations stated above, we are of opinion that the order under appeal cannot be sustained and cannot be said to be an order necessary in the interests of justice or to prevent the abuse of the process of the Court. We therefore allow the appeal with costs, and set aside the order restraining the appellant from proceeding with the suit at Asansol. SHAH, J. I have perused the judgment delivered by Mr. Justice Dayal. I agree with the conclusion that the appeal must succeed but I am unable to hold that civil courts generally have inherent jurisdiction in cases not covered by rr. 1 and 2 of O. 39, Civil Procedure Code to issue temporary injunctions restraining parties to the proceedings before them from doing certain acts. The powers of courts, other than the Chartertd High Courts, in the exercise of their ordinary original Civil jurisdiction to issue temporary injunctions are defined by the terms of section 94(1)(c) and 472 O. 39, Civil Procedure Code. A temporary injunction may issue if it is so prescribed by rules in the Code. The provisions relating to the issue of temporary injunctions are to be found in O. 39 rr. 1 and 2: a temporary injunction may be issued only in those cases which come strictly within those rules, and normally the civil courts have no power to issue injunctions by transgressing the limits prescribed by the rule. It is true that the High Courts constituted under Charters and exercising ordinary original jurisdiction do exercise inherent jurisdiction to issue an injunction to restrain parties in a suit before them from proceedings with a suit in another court, but that is because the Chartered High Courts claim to have inherited this jurisdiction from the Supreme Courts of which they were successors. This jurisdiction would be saved by section 9 of the Charter Act (24 and 25 Vict. c. 104) of 1861, and in the Code of Civil Procedure, 1908 it is expressly provided by section 4. But the power of the civil courts other than the Chartered High Courts must be found within section 94 and O. 39 rr. 1 and 2 of the Civil Procedure Code. The Code of Civil Procedure is undoubtedly not exhaustive: it does not lay down rules for guidance in respect of all situations nor does it seek to provide rules for decision of all conceivable cases which may arise. The civil courts are authorised to pass such orders(as may be necessary for the ends of justice, or to prevent abuse of the process of court, but where an express provision is made to meet a particular situation the Code must be observed, an departure therefrom is not permissible. As observed in L. R. 62 I. A. 80 (Maqbul Ahmed vs Onkar Pratab) "It is impossible to hold that in a matter which is governed by an Act, which in some limited respects gives the court a statutory discretion, there can be implied in 473 court, outside the limits of the Act a general discretion to dispense with the provisions of the Act." Inherent jurisdiction of the court to make order ex debito justitiae is undoubtedly affirmed by section 151 of the Code, but that jurisdiction cannot be exercised so as to nullify the provisions of the Code. Where the Code deals Expressly with a particular matter, the provision should normally be regarded as exhaustive. Power to issue an injunction is restricted by section 94 and O. 39, and it is not open to the civil court which is not a Chartered High Court to exercise that power ignoring the restriction imposed there by, in purported exercise of its inherent jurisdiction. The decision of this Court in Padam Sen vs The State of Uttar Pradesh(1) does not assist the case of the appellant. In Padam Sen 's case this Court was called upon is a original appeal to consider whether an order of a Munsiff appointing a commissioner for seizing certain account books of the plaintiff in a suit pending before the Munsiff was an order authorised by law. It was the case for the prosecution that the appellants offered a bribe to the commissioner as consideration for being allowed to tamper with entries therein, and thereby the appellants committed an offence punishable under section 165A of the Indian Penal Code. This Court held that the commissioner appointed by the civil court in exercise of powers under O. 26 C. P. Code did not hold any office as a public servant and the appointment by the Munsiff being without jurisdiction, the commissioner could not be deemed to be a public servant. In dealing with the argument of counsel for the appellants that the civil court had inherent powers to appoint a commissioner in exercise of authority under section 151 Civil Procedure Code for purposes which do not fall 474 within the provisions of section 75 and O. 26 Civil Procedure Code, the Court observed: "Section 75 of the Code empowers the Court to issue a commission, subject to conditions and limitations which may be prescribed, for four purposes, viz., for examining any person, for making or adjusting accounts and for making a partition. Order XXVI lays down rules relating to the issue of commissions and allied matters. Mr. Chatterjee, learned counsel of the appellants, has submitted that the powers of a Court must be found within the four corners of the Code and that when the Code has expressly dealt with the subject matter of commissions in section 75 the Court cannot invoke its inherent powers under section 151 and thereby add to its powers. On the other hand, it is submitted for the State, that the Code is not exhaustive and the Court, in the exercise of its inherent powers, can adopt any procedure not prohibited by the Code expressly or by necessary implication if the Court considers it necessary for the ends of justice or to prevent abuse of the process of the Court. x x x x x x x x The inherent powers of the Court are in addition to the powers specifically conferred on the Court by the Code. They are complementary to those powers and therefore it must be held that the Court is free to exercise them for the purposes mentioned in section 151 of the Code when the exercise of those powers is not in any way in conflict with what has been expressly provided in the Code or against the intentions of the Legislature. It is also well recognized that the inherent power is not to be exercised in a manner which will be 475 contrary or different from the procedure expressly provided in the Code." The Court in that case held that in exercise of the powers under section 151 of the Code of Civil Procedure, 1908 the Court cannot issue a commission for seizing books of account of plaintiff a purpose for which a commission is not authorized to be issued by section 75. The principle of the case is destructive of the submission of the appellants. Section 75 empowers the Court to issue a commission for purposes specified therein: even though it is not so expressly stated that there is no power to appoint a commissioner for other purposes, a prohibition to that effect is, in the view of the Court in Padam Sen 's case, implicit in section 76. By parity of reasoning, if the power to issue injunctions may be exercised, if it is prescribed by rules in the Orders in Schedule I, it must he deemed to be not exercisable in any other manner or for purposes other than those set out in O. 39 rr. 1 and 2. Appeal allowed.

M filed a suit at Asansol against H for recovery of money. Later, H filed a counter suit at Indore against M for recovery of money. In the Asansol suit one of the defences raised by H was that the Asansol court had no jurisdiction to entertain the suit. H applied to the Asansol court to stay the suit but the court refused the prayer. An appeal to the Calcutta High Court against the refusal to stay was dismissed with the direction that the preliminary issue of jurisdiction should be disposed of by the trial court immediately. Thereupon, H applied to the Indore court for an injunction to restrain M from proceeding with the Asansol suit pending the disposal of the Indore suit and the court purporting to act under O. 39 Code of Civil Procedure granted the injunction. M appealed to the Madhya Bharat High Court which dismissed the appeal holding that though O. 39 was not applicable to the case the order of injunction could be made under the inherent powers of the court under section 151 Code of Civil Procedure. ^ Held, that the order of injunction was wrongly granted and should be vacated. Per, Wanchoo, Das Gupta, and Dayal,JJ. The Civil courts had inherent power to issue temporary injunctions in cases which were not covered by the provisions of O. 39 Civil Procedure Code. The provisions of the Code were not 451 exhaustive. There was no prohibition in section 94 against the grant of a temporay injunction in circumstances not covered by O. 39. But inherent powers were not to be exercised when their exercise was in conflict with the express provisions of the Code or was against the intention of the legislature. Such powers were to be exercised in very exceptional circumstances. A plaintiff of a suit in another jurisdiction could only be restrained from proceeding with his suit if the suit was vexatious and useless. It was not so in the present case. It was proper that the issue as to jurisdiction should be decided by the Asansol court as directed by the Calcutta High Court. The Indore court could not decide this issue. Beside, it was open to the Asansol court to ignore the order of the Indore court and to proceed with the suit. This would place M in an impossible position. An order of a court should not lead to such a result. Varadacharlu vs Narsimha Charlu, A.I.R. 1926 Mad.258; Govindarajalu vs Imperial Bank of India, A.I.R. 1932 Mad. 180 ; Karuppayya vs Ponnuswami, A.I.R. 1933 Mad. 500(2); Murugesa Mudali vs Angamuthu Madali, A.I.R. 1938 Mad. 190 and Subramanian vs Seetarama, A.I.R. 1940 Mad. 104, not approved. Dhaneshwar Nath vs Ghanshyam Dhar, A.I.R. 1940 All.185, Firm Richchha Ram vs Firm Baldeo Sahai, A.I.R. 1940 All.241, Bhagat Singh vs Jagbir Sawhney, A.I.R. 1941 Cal. 670 and Chinese Tannery Owners ' Association vs Makhan Lal, A.I.R. 1952 Cal. 550, approved. Padam Sen vs State of U.P. [1961] 1 section C. R. 884, Cohen vs Rothfield, L. R. and Hyman vs Helm, L. R.(1883) , relied on. Per, Shah, J. Civil courts have no inherent power to issue injunctions in case not covered by O. 39, rr. 1 and 2 Code of Civil Procedure. The power of civil courts, other than Chartered High Courts, to issue injunctions must be found within the terms of section 94 and O. 39, rr. 1 and 2. Where an express provision is made to meet a particular situation the Code must be observed and departure therefrom is not permissible. Where the Code deals expressly with a particular matter the provision should normally be regarded as exhaustive. Padam Sen vs State of U. P. [1961] 1 section C. R. 884, relied upon.

Appeals Nos. 182 186 of 1963. Appeals by special leave from the judgment and order dated January 1961 of the Gujarat High Court in Second Appeals Nos. 105, 106, 107, 112 and 193 of 1960. C. K. Daphtary, Attorney General, R. Ganapathy Iyer, R. K. P. Shankardass and R. H. Dhebar, for the appellant (in all the appeals). Purshottam Trikamdas, B. Parthasarathy, J. B. Dadachanji O. C. Mathur and Ravinder Narain, for the resdondents (in all the appeals). January 30, 1964. Hidayatullah J., Shah J., and Mudholkar J. delivered separate Judgments allowing the appeal. Raghubar Dayal J. agreed with the order proposed by Hidayatullah J. The dissenting opinion of Sinha C.J. and Rajagopala Ayyangar J. was delivered by Ayyangar J. Subba Rao J. delivered a separate dissenting opinion. AYYANGAR J. In this batch of five analogous appeals, by special leave, the main question for determination is whether the rights which were in controversy between the 472 parties in the courts below could be enforced by the Munici pal courts; or in other words, whether or not "Act of State" pleaded by the State of Gujarat is an effective answer to the claims made by the respective respondents to the rights over forests claimed by them in the suits giving rise to these appeals. Vora Fiddali Badruddin Mithibarwala is the respondent in Civil Appeals Nos. 182 and 184 of 1963. Vora Hakimuddin Tayabali Amthaniwala is the respondent in Civil Appeal No. 183 of 1963. Mehta Kantilal Chandulal is the respondent in Civil Appeal No. 185 of 1963, and Pathan Abbaskhan Ahmedkhan is the respondent in Civil Appeal No. 186 of 1963. In all these Appeals the State of Gujarat is the appellant. The course these litigations have taken in the courts below may briefly be stated as follows: The respondent in Civil Appeal No. 182 of 1963, is the assignee of the rights of one Vora Hatimbhai Badruddin and was brought on a record as plaintiff during the pendency of the suit in the trial court, namely, the court of the Civil Judge (Senior Division) at Godhra, being Civil Suit No. 115 of 1950, for an injunction and ancillary reliefs to restrain the appellant and its officers from interfering with the plaintiff 's alleged rights to cut and carry away timber etc., from the Gotimada jungle, rasing his rights under a contract dated August 21, 1948, for a period of three years on payment of a consideration of Rs. 9,501 to the Jagirdar of the village, Thakore Sardar Singh Gajesingh. Civil Suit No. 134 of 1950, giving rise to Civil Appeal No. 184 of 1963, was also instituted by the same plaintiff who claimed by virtue of an assignment of the rights under a similar contract in respect of another forest in village Nanirath for a period of four years, the consideration being the cash payment of Rs. 9,501. Civil Suit No. 106 of 1951, giving rise to Civil Appeal No. 183 of 1963. was instituted by Vora Hakimuddin Tayyabali Amthaniwalla. His claim was based on an agreement with the Jagirdar. dated December 7, 1948, for a period of four years for a consideration of Rs. 6,501 in respect of the forest in village Rathda. All these three suits, in which the reliefs claimed 473 were similar, were tried together and disposed of by a com mon judgment, delivered by the trial court on January 3, 1956. All the suits were dismissed. The Court took the view that the rights of the plaintiffs, such as they were, could not be enforced by the courts. Civil Appeal No. 185 of 1963 arises out of Suit No. 80 of 1953, filed by Mehta Kantilal Chandulal. He owned the Inami villages Lalekapur and Narsingpur and alleged that he had given a contract for cutting the trees in his villages for a consideration of Rs. 11,000 on May 29, 1948, for a period of four years, and that his transferee had been prevented by the State from exercising those rights. He also prayed for a similar injunction, as in the other suits. This suit was also dismissed by the trial court by its judgment, dated March 23, 1956. The last of the suits is Suit No. 90 of 1955, giving rise to Civil Appeal 186 of 1963. The plaintiff had claimed to have obtained similar right of felling trees in the forest belonging to the Jagirdar of Mayalapad on August 16, 1948 for Rs. 1,191 for a period of three years. This suit was decreed by a judgment dated August 6, 1956. The unsuccessful plaintiffs filed four appeals to the District Judge, Panch Mahals, at Godra, being appeals Nos. 17, 18, 19 and 48 of 1956. All the appeals were heard together and, by a common judgment, were dismissed on February 28, 1957, the judgment of the trial court being confirmed. The 5th appeal, being appeal No. 74 of 1956, was filed by the State. Ile appeal was allowed by a separate judgement, dated September 30, 1957, dismissing the suit. The plaintiffs respondents filed five second appeals, being Second Appeals Nos. 105, 106, 107, 112 and 193 of 1960 in the High Court of Gujarat. The appeals were heard together and were allowed on January 24, 1961 with the result that the suits were decreed and the appellant was restrained by an injunction from interfering with the plaintiffs ' enjoyment of the rights in the forests, as claimed by them. As the State failed to obtain the necessary certificate of fitness from the High Court, it moved this Court and obtained special leave to appeal. And that is how these appeals have come up to this Court. These appeals were first heard by a Bench of five Judges, and it was directed that the matter be placed for hearing by a larger Bench, as the Bench was of the opinion that the decision of this Court in Virendra Singh vs The 474 State of Uttar Pradesh(1) required reconsideration. That is how these appeals have been placed before this special Bench. Before dealing with the questions that arise for deter mination in these appeals, it is necessary and convenient at this stage to set out the course of events leading up to the institution of the suits aforesaid, giving rise to these appeals. The several villages, the forest rights in which are in dispute in these cases, formed part of the State of Sant. The steps in the transition of this State under its ruler who was designated the Maharana into an integral part of the territory of the Union of India conformed to the usual pattern. With the lapse of the paramountcy of the British Government on the enactment of the Indian Independence Act, the ruler achieved complete sovereignty. Soon thereafter by an instrument of accession executed by the ruler, the State acceded to the Dominion of India so as to vest in the latter power in relation to 3 subjects Defence, External Affairs and Communications. On March 19, 1948 the ruler entered into a merger agreement with the Governor General of India by which "with a view to integrate the territory with the Province of Bombay at as early a date as possible", the full and exclusive authority and powers in relation to the administration of the State were ceded to the, Dominion Government. The agreement was to take effect from June 10, 1948. It is necessary to set out two of the Articles of this Agreement. Article 1 ran thus: "1. The Maharana of Sant hereby cedes to the Dominion Government full exclusive authority, jurisdiction and powers for and in relation to the governance of the State and agrees to transfer the administration of the State to the Dominion Government on the 10th day of June, 1948 (hereinafter referred to as "the said day"). And from the said day the Dominion Government will be competent to exercise the said powers, (1) ; 475 authority and jurisdiction in such manner and through such agency as it may think fit. " Under Article 3 of the agreement, the ruler agreed to furnish to the Dominion Government before October 1, 1948 a list of all his private properties over which he was, under the terms of the agreement, to retain full ownership and enjoyment. After this agreement came in force on June 10, 1948, the Central Government delegated its functions to the Bombay Government by virtue of the powers vested in it by the Extra Provincial Jurisdiction Act, 1947. Subsequently, Shri V. P. Menon, Secretary in the Ministry of State, wrote a letter to the Maharana of Sant on October 1, 1948 (exhibit 194). This letter was entitled a "Letter of Guarantee" and was to be treated as supplementary to the Agreement of Merger dated March 19, 1948. Amongst other matters. it provided by cl. 7: "No order passed or action taken by you before the date of making over the administration to the Dominion Government will be questioned un less the order was passed or action taken after the 1st day of April, 1948, and it is considered by the Government of India to be palpably unjust or unreasonable. The decision of the Government of India in their respect will be final. " In view of the forthcoming integration of (,lie territory of Indian States into the Dominion of India, the Government of India Act, 1935, was amended and section 290 A was inserted. In exercise of the powers conferred by that section, the Governor General of India promulgated the States Merger (Governor Provinces) Order, 1949, on July 27 1949 which came into force on August 1, 1949. As a result of that order the integration of Indian States, including the Sant State with that of the province of Bombay, was completed with effect from that date, namely August 1, 1949. In the meantime, the ruler of the Sant State passed or issued "a resolution" or Tharao on March 12, 1948, which has given rise to the present series of litigations. Under this " 'instrument" marked as exhibit 192, to use a neutral expres 476 sion in view of the controversy as to its nature, called Tharao, an order was passed by the Maharana of Sant State whose terms will be referred to later and discussed in greater detail, granting forest rights to holders of certain specified tenures. The holders of such tenures in the Sant State entered into a number of agreements with the, parties, parting with their rights in the forest timber, e.tc., for a specified period, in consideration of cash payments made by those third parties to the holders of the tenures. It is not necessary to set out in detail all those agreements it is enough to mention, by way of a sample the agreement dated August 21, 1948 (exhibit 175) whereby the tenure holder granted as briefly adverted to earlier to Vohra Hatimbhai Badruddin Mithiborwala the right to cut and remove timber and firewood from the forest of Mouja Gothimada for a consideration of Rs. 9,501 for a period of three years. The written agreement contains quite a number of clauses which it is not necessary to set out for the purposes of this case. After the aforesaid grants, correspondence started between the grantors and the grantees on the one hand, and the State Forest Department on the other. When the District Forest Officer was informed about the transactions aforesaid. and the grantees applied for authorisation to remove timber etc. the Forest Authorities ordered that no export outside would be permitted, pending receipt of orders from Government. They also required an undertaking from the purchaser that he would abide by the decision and orders passed by the Government. Thereupon the grantor, Thakur Sardar Singh Gaje Singh gave an undertaking to abide by the decision and orders of the Government of Bombay in respect of the Gothimada forests "rights over which were conferred on me. by Santrampur State Government on March 12, 1948 in their resolution No. G. 371, dated March 12, 1948. " The Divisional Forest Officer, by his order dated January 10, 1949, passed an order under the provisions of r. 4 of the Rules under section 41 of the Indian Forest Act authorising the grantee to remove forest produce like timber firewood and charcoal from Gothimada forest. This was followed by a memorandum by the Conservator of Forests North Western Circle of the Bombay State by which the Divisional Forest Officers were directed to conti 477 nue to issue authorisations to contractors of Jagirdars who had obtained rights over the forests in the Sant State under the Tharao of the ruler, dated March 12, 1948. He, however, pointed out that until the question of the rights of the grantees over private forests was finally settled by the Government an undertaking should be taken from the, persons concerned that they would abide by the orders passed by the Government in respect of their rights. This, as stated al ready had been obtained by the District Officers even earlier. On July 8, 1949, the Government of Bombay passed an order in which they stated "Government considers that the order passed by the ruler of the Sant State under his No. 371, dated March 12, 1948, transferring forest rights to all the Jagirdars of the Jagir villages, are mala fide and that they should be cancelled. . This decision or order was, however, not communicated to the jagirdars or their contractors though effect was given to it by the Forest Authorities by stopping all further fellings. Some time thereafter the respondents issued notices under section 80 of the Civil Procedure Code to the Government of Bombay seeking respect for their rights under the Tharao of March, 1948 and after waiting for two months filed the suits out of which these appeals arise. By the written statements which they filed, the Government of Bombay raised principally the def ence that the act of the ruler in passing the Tharao was not binding on them as the successor State and that they in exercise of their sovereign authority, had cancelled the concession as unreasonable and mala fide by their order, dated July 8, 1949, already referred. It might be mentioned that after the suit was instituted and while it was pending before the trial judge a formal resolution of the Government of Bombay was passed and published on the 6th of February, 1953, in which they set out the legal position that the rights acquired under the Tharao were not enforceable as against the Bombay Government as the successor State unless those rights were recognised and that as on the other hand the same had been specifically repudiated, the Jagirdars and their contractors had no title which they could enforce against the Government. We have already narrated the course of the litigations and this would be the convenient stage at which to indicate 478 the grounds on which the learned Judges of the High Court have upheld the claims of the plaintiffs who are the respondents in the several appeals before us. There were two, principle points that were urged on their behalf before the learned Judges. The first was that the Tharao of March 12, 1948, was in truth and substance a 'law ', a legislative act of the ruler of Sant, which was continued under article 372 of the Constitution and that in consequence the rights obtained by the grantees thereunder could not be abrogated or set at naught by a mere executive order which the Government resolution of February, 1953, undoubtedly was. This submission was rejected by the Court holding that the Tharao was merely a grant originating in an administrative or executive order of the ruler. The other contention was that through the agreement of merger by which the integra tion of the Sant State with the Dominion of India brought about an "act of state" and that accordingly, no rights based on the agreement of merger, dated March 19, 1948, or in the supplementary letter, dated October 1, 1948, could be, asserted or enforced in the Municipal Courts of the successor State unless the same were recognised by Government still cl. 7 of the letter of Shri V. P. Menon, dated October 1, 1948, to the ruler could be referred to and relied on for the purpose of drawing an inference that the right of the Government to repudiate the grant by the ruler had been waived. This submission was accepted and it was on this reasoning that the learned Judges have decreed the suits of the several plaintiffs. It is the correctness of these two conclusions that are being challenged before us, the first by the respondente and the other by the appellant State. Arising from the submissions of the learned Attorney General the points that require examination are as to the legal effect of the acces sion, integration and merger of the Sant State in the Indian Union, on the rights that the plaintiffs acquired under the Tharao, dated March 12, 1948 and secondly whether the provisions in section 299 of the Government of India Act, 1935, or those contained in Part III of the Constitution affect the nature or enforceability of those rights. 'Me questions to be considered under the first head in particular are: (a) Whether the rights acquired under the previous 479 ruler are enforceable against the Governments of the Union and the States without those rights being recognised by the appropriate Government. (b) What is the effect of the letter of the Government of India, dated October 1, 1948, on the right of the Government to refuse to recognise a grant under the Tharao. (c) What is the effect of the Government 's communication to the Chief Conservator of Forests dated July 8, 1949 and of the resolution of Government of February, 1953. Under the second head, besides the constitutional guarantees protecting rights to property contained in the Government of India Act and the Constitution, the effect in the first instance of section 5 of the Government of India Act, 1935, of the acceding States becoming part of the Dominion of India and later of the manner in which the Constitution of India was framed. The other question that requires consideration is whether the Tharao dated March 12, 1948 is merely a grant originat ing in an executive order or is it a law which is continued in operation by article 372 of the Constitution. In Virendra Singh 's case(1) this Court held that even on the basis that the merger of the Indian States in the Indian Union and the treaties by which that was accomplished were acts of State, still by reason of the manner in which the Constitution of India was brought into being and because of the provisions which it contained, in particular those guaranteeing property rights of its citizens, the acquired rights of the inhabitants of the Indian States quoad their rulers could not, after the Constitution, be annulled or abrogated by arbitrary executive action on the part of the, Union or State Governments. The learned Judges thus assumed as correct the rule of Public International Law relevant to that context expounded by the Privy Council in a number of decisions rendered on appeals from the Indian (1) 480 High Courts. For this reason we consider that it would be convenient for a proper appreciation of the points now in controversy to premise the discussion by briefly setting out the principles underlying these decisions of the Privy Coun cil, reserving their detailed examination to a later stage. These principles have been tersely summarised and the ratio of the rule explained by Lord Dunedin in Vajesinghji vs Secretary of State for India etc.(1) in a passage which has been often quoted in later cases on the subject and we consider that it would be sufficient if we extract it. The learned Lord said: "When a territory is acquired by a sovereign state for the first time that is an act of State. It matters not how the acquisition has been brought about. It may be by conquest, it may be by cession following on treaty, it may be by occupation of territory hitherto unoccupied by a recognised ruler. In all cases the result is the same. Any inhabitant of the territory can make good in the municipal courts established by the new sovereign only such rights as that sovereign has through his officers, recognized. Such rights as he had under the rule of prede cessors avail him nothing. Nay more, even if in a treaty of cession it is stipulated that certain inhabitants could enjoy certain rights, that does not give a title to those inhabitants to enforce these stipulations in the municipal courts. The right to enforce remains only with the high contracting parties." (italics ours). This has been accepted as expressing the constitutional law of the United Kingdom and the same has been.applied tot merely to claims or titles which were sought to be enforced against the Indian Government but also in other parts of the British Empire See Cook vs Spring(2). This was the law laid down and given effect to by the Privy Council until India attained independence. 151 IA 357. (2) 481 Virendra Singh vs State of Uttar Pradesh (1), however, struck a different note particularly as regards the matters covered by the sentences we have given in italics in Lord Dunedin 's exposition of the law, and to this decision we shall immediately turn. The facts of the case were briefly these: On January 5, 1948, the ruler of Sarila granted the village Rigwara to the petitioners who moved this Court while on the 28th of January, 1948, the ruler of Charkari granted certain other villages to the same petitioners. As the rights of the petitioners were sought to be nullified by an order of the Government of Uttar Pradesh they filed a petition under article 32 of the Constitution praying that the order of the Government of Uttar Pradesh revoking the grants in their favour be declared void and for consequential reliefs. A few more facts in regard to the constitutional history of these two States is necessary to be stated to appreciate some of the matters which figured in the decision in Virendra Singh 's case(2). After the date of the grant in favour of the petitioners 35 States in Bundelkhand and Bhagalkhand, including Charkari and Sarila agreed to unite themselves into a State to be called the United State of Vindhya Pradesh. While this Union was in existence, certain officials of this Government interfered with the rights of the petitioners but the Government of the United State of Vindhya Pradesh issued orders directing the officers to abstain from such interference. Subsequently the rulers of the 35 States dissolved their Union and ceded to the Gov ernment of Indian Dominion all their powers and jurisdiction and the Dominion constituted the area into a Chief Commissioner 's province for the purpose of administration, but the four villages granted to the petitioners were, how ever, detached from the centrally administered State and absorbed into Uttar Pradesh. On August 29, 1952, the Governor of Uttar Pradesh revoked the grants made in favour of the petitioners. The question before the Court was whether this order of revocation of the grants made by the former rulers was justiciable in courts and if justiciable, valid. (1) ; S.C. 31 482 The judgment of the Court was delivered by Bose J. The learned Judge after stating the question arising for decision as being "whether the Union Government had the right and the power to revoke these grants as an act of State?", pointed out that jurists had held divergent views on this matter. At one extreme, he said, was the view expressed by the Privy Council in a series of cases to which reference was made and as summarising their effect the passage from the judgment of Lord Dunedin we have extracted already was cited. At the other extreme was the view of Marshall C.J., in United States vs Percheman(1) from which he quoted the following: "It may not be, unworthy of remark that it is very unusual, even in case of conquest, for the conqueror to do more than to displace the sovereign and assume dominion over the country. The modern usage of nations, which has become law, would be violated; that sense of justice and of right which is acknowledged and felt by the whole civilised world would be outraged, if private property should be generally confiscated, and private rights annulled. The people change their allegiance; their relation to their ancient sovereign is dissolved; by their relations to each other, and their rights of property, remain undisturbed. If this be the modem rule even in cases of conquest, who can doubt its application to the case of an amicable cession of territory?. A cession of territory is never understood to be a cession of the property belonging to the inhabitants. The King cedes that only which belonged to him. Lands he had previously granted were not his to cede. Neither party could consider itself as attempting a wrong to individuals, condemned by the practice of the whole civilised world. The cession of a territory by its name from one sovereign to another, conveying the compound idea of surrendering at the same time the lands and the people who inhabit them, would be (1) ; at pp. 86 87. 483 necessarily understood to pass the sovereignty only, and not to interfere with private property After referring to a few other decisions of the English Courts the learned Judge proceeded: "We do not intend to discuss any of this because, in our opinion, none of these decisions has any bearing on the problem which confronts us, namely, the impact of the Constitution on the peoples and territories which joined the Indian Union and brought the Constitution into being. . Now it is undoubted that the accessions and the acceptance of them by the Dominion of India were acts of State into whose competency no municipal court could enquire; nor any Court in India, after the Constitution, accept jurisdiction to settle any dispute arising out of them because of Article 363 and the proviso to Article 131; all they can do is to register the fact of accession. . But what then; Whether the Privy Council view is correct or that put forward by Chief Justice Marshall in its broadest outlines is more proper, all authorities are agreed that it is within the competence of the new sovereign to accord recognition to existing rights in the conquered or ceded territories and, by legislation or otherwise, to apply its own laws to them and these laws can, and indeed when the occasion arises must, be examined and interpreted by the municipal courts of the absorbing State. " The learned Judge then went on to point out that the title of the petitioners to the disputed villages had not been repudiated upto January 26, 1950. Because of the non exercise of the right to repudiate till that date, the petitioners were admittedly in de facto possession of the villages and the learned Judge adverted to the circumstance that those possessory rights could have been asserted and enforced against all persons except the rulers who granted the lands, and 484 except possibly the succeeding State. Considering it unnecessary to pronounce whether these rights could be enforced against the rulers as well as the Dominion of India as the succeeding sovereign, he observed that as these rights were factually in existence at the date of the Constitution and as by that date the subjects of the rulers of Charkari and Sarila had become the subjects of the Union, there could be no question of the Union Government claiming to exercise an " act of State" operating to deprive the petitioners of their property following in this respect the well known decisions of Walker vs Baird(1) and Johnstone vs Pedlar(2). He further explained that "the Constitution by reason of the authority derived from and conferred by the peoples of this land blotted out in one magnificent sweep all vestiges of arbitrary and despotic power in the territories of India and over its citizens and lands and prohibited just such acts of arbitrary power as the State now seeks to uphold. " The passage extracted and indeed the entire judgment is replete with a description of the poetry of India 's constitutional evolution as an unified State during the most momentous period of her history from the Declaration of Independence on August 15, 1947, to the coming into force of the Constitution on January 26, 1950 and of the saga of the march of the subjects of the former Indian princes from being subjects of an autocratic ruler to a modern democatic set up in which they are full fledged citizens of India, in language at once picturesque and of authentic eloquence. We should not be understood to minimise in any manner the political significance of the events described or underrate their importance, content or meaning if we differ somewhat from certain of the conclusions drawn on matters which are relevant for the purposes of the points arising for decision in these appeals. Pausing here we ought to point out that several decisions of this Court subsequent to Virendra Singh 's case(4) of which it is sufficient to refer to Mls. Dalmia Dadri Cement Co. Ltd. vs The Commissioner of Income Tax(4), Jagan (1) (2) ; (3) ; (4) [1959] S.C.R. 729. 485 nath Agrawala vs State of Orissa(1), Promod Chandra Deb vs The State of orissa(2) and State of Saurashtra vs Jamadar Mohamad Abdulla(3) have proceeded on the acceptance of the constitutional doctrine enunciated by the Privy Council. We shall be referring to them later, but before doing so it is necessary to set out certain matters which are not in controversy. The native Indian rulers were undoubtedly sovereign in the territories under their jurisdiction and they parted with their sovereignty in stages, firstly on accession, then on integration and finally by what has been felicitously termed in the White Paper on Indian States as 'unionization ' i.e., by State territory becoming part and parcel of the territory of the Union of India which meant the complete extinction of their separate existence and individual sovereignty and of their States as separate political units. Proceeding next to deal with Virendra Singh 's case(4) a close analysis of the reasoning underlying the decision discloses the following as its ratio: (1) There were two schools of thought as regards the effect of a change in sovereignty in respect of the enforceability of the rights of private individuals against the succeeding sovereign. At one end of the scale were the decisions of the Privy Council which proceeded on the acceptance of the principle, that rights enforceable against the previous ruler or sovereign ceased to be enforceable by the Municipal Courts of the succeeding sovereign unless and until a competent authority or organ of the succeeding sovereign recognised those rights. The passage in the judgment of Lord Dunedin in Vajesingjis case(5) was typical of this view. On the other hand, there was another and, if one might say so, an opposite view expressed in the decisions of the Supreme Court of the United States of which the classic exposition by (1) ; (2) [1962] 1 Supp. S.C.R. 405. (3) (4) (1955] 1 S.C.R. 415. (5) 51 I. A. 357. 486 Chief Justice Marshall in Percheman 's case(1) was typical, that the proper and just rule of Public International Law which should be given effect to by municipal courts was that the changes in sovereignty over a territory did not or should not have any effect on the rights of the private individuals even as regards the enforceability of their claims as against the State and that it was the obligation certainly moral, if not also legal, of the succeeding sovereign to give effect to such rights previously acquired by gants from the previous sovereign. After pointing out these divergent views the learned Judges, in Virendra Singh 's case(2), considered it unnecessary to express their opinion as regards the correctness or acceptability of either view, but proceeded, however, on the assumption that the constitutional doctrine as enunciated by the Privy Council appealed to the facts of the case before them. (2) Starting from the position that the petitioners obtained a good title to the villages granted to them by the rulers of Sarila and Charkari, they proceeded to analyse the nature of the title which they had under the grants. As a result of this examination they arrived at the conclusion that even on the basis of the decisions of the Privy Council, their title was only voidable at the option of the succeeding sovereign. They recognised that the changes that took place in the constitutional position of the State of Charkari and Sarila undoubtedly brought in a change in the sovereignty of that territory and hold that the changes thus brought about including the treaties which marked the transition were "Acts of State" and that the interpretation or enforcement of rights under the treaties was outside the jurisdiction of municipal courts. The petitioners, they held, could not, therefore obtain any advantage by reliance on any provision in the (1) ; at pp. 86 87. (2) ; 487 treaty safeguarding their rights, for apart from the treaties being "Acts of State" they were engagements between two sovereign States and enforceable between them at the instance of the high contracting parties through diplomatic channels and not by recourse to municipal courts, and the petitioners not even being parties to the treaties could not obviously claim any right to enforce them. In this connection the terms of article 363 of the Constitution which contained an express embargo on the enforcement by the municipal courts of the, provisions of these treaties were adverted to as reinforcing this position. (3) If guarantees contained in the treaties be put aside, the next question to be considered was whether the Governments which emerged as a result of the Constitution, were competent to avoid or repudiate the titles obtained by the petitioners under the previous ruler by an "Act of State". They answered this question in the negative for four reasons: (i) The constitution emerged as a result of the conjoint action of the subjects of the former Indian rulers and the people of former British India. When as a result of this joint effort the Constitution was brought into existence there was no question of conquest or cession so as to attract those doctrines of Public International Law relating to the effects of rights arising out of changes in sovereignty brought about by conquest, cession, treaty etc. (ii) The subjects of the former Indian rulers became, when the Constitution emerged, Indian citizens, and as against its own subjects or citizens there was no question of any "Act of State" by any Indian Government. (iii) Even if the previous rulers had vested in them autocratic powers to revoke grants 488 made by them in favour of their subjects, the Government of the Union and the States which were functioning under a Constitution which contained fundamental rights guaranteeing protection of property rights against arbitrary executive action could 'not claim to exercise those arbitrary powers which they might have inherited from the previous rulers, and (iv) The petitioners had at the commencement of the Constitution a possessory title to the property granted to them and had also a right at that date, to continue in possession unless and until their title which was voidable was extinguished by repudiation by the Governments which were established by the Constitution. These proprietary rights were, however, protected by articles 19 (1) (g) and 31 (1) of the Constitution and so the petitioners could not be deprived of their proprietary rights except by competent legislation enacted after the commencement of the Constitution. We shall now proceed to examine the above reasoning of the learned Judges. Reserving for later consideration the arguments addressed to us regarding the divergent views of judges, jurists and writers on Public International Law on the topic of the enforceability of the rights derived from previous sovereigns against a succeeding sovereign on a change of sovereignty, we shall proceed on the same lines as in Virendra Singh 's case(1) viz., on the acceptance of the rule as enunciated in the decisions of the Privy Council. It is necessary, first to understand the precise scope and implications of these decisions and of the law explained in them. The earliest of these usually referred to in this connection is Secretary of State for India vs Kamachee Boye Sahiba(2) which was concerned with the justiciability in municipal courts of a seizure by the East India Company of not merely the Raj but even of the private properties of the (1) ; (2) (1859) 7 MOO. I.A. 489 Raja of Tanjore. The Privy Council held in a judgment delivered by Lord Kingston that as the seizure had been made by the Company as a sovereign power the municipal courts "had no means of forming or the right of expressing if they had formed any opinion of the propriety or the justice of that act. " That is, however, a different aspect of what is termed 'Act of State ' from what is strictly relevant to the facts before us. That decision was referred to with approval by the Privy Council in a case from India Secretary of State for India in Council vs Bai Rajbai(1) where the point in controversy was somewhat akin to those in the present appeals. The question at issue before the Privy Council was whether the respondent was entitled to the continued ownership and possession of a village called Charodi in the province of Gujarat. The respondent 's title to the village was ultimately based on rights claimed to have been granted by the Gaekwar of Baroda. The territory in which the village was situated was ceded by the Gaekwar to the British Government in 1817. The claim of the respondent to full ownership of the property was not recognised by the Indian Government after the cession and Government held that the respondent had no more than a leasehold interest. The question before the Privy Council was whether the respondent was entitled to assert in municipal courts rights more extensive, than what had been recognised by the authorities. Dealing with this Lord Atkinson delivering the judgment of the Board stated: ". It is essential to consider what was the precise relation in which the kasbatis (respondents) stood to the Bombay Government the moment the cession of their territory took effect, and what were the legal rights enforceable in the tribunals of their new sovereign, of which they were thereafter possessed. The relation in which they stood to their native sovereigns before this cession, and the legal rights they enjoyed under them, are, save in one respect, entirely irrelevant matters. They could not carry in under the new regime the legal rights, (1) 42 I.A. 229. 490 if any, which they might have enjoyed under the old. The only legal enforceable rights they could have as against their new sovereign were those, and only those, which that new sovereign, by agreement expressed or implied, or by legislation, chose to confer upon them. Of course, this implied agreement might be proved by circumstantial evidence, such as the mode of dealing with them which the new Sovereign adopted, his recognition of their old rights, and express or implied election to respect them and be bound by them, and it is only for the purpose of determining whether and to what extent the new sovereign has recognised these antecession rights of the kasbatis, and has elected or agreed to be bound by them, that the consideration of the existence, nature, or extent of these rights becomes a relevant subject for enquiry in this case. This principle is wellestablished, though it scarcely seems to have been kept steadily in view in the lower courts in the present case. It is only necessary to refer to two authorities on the point, namely, the case of Secretary of State for India vs Kamachee Boye Sahiba [(1859) 7Moo. I.A. (476) decided in the year 1859, and Cook vs Sprigg decided in the year 1899. " This passage would appear to indicate that the effect of the change of sovereignty is not to treat rights previously enforceable against the former ruler as only voidable at the instance of the succeeding sovereign, but to effect a com plete destruction of those rights until by recognition or by legislation of the succeeding sovereign the same is obtained by the previous grantee. A question very similar to Bai Rajbais case(1) arose in Vajesingji 's case(2) where the statement of the law as explained by Lord Atkinson was approved and Lord Dunedin, as already stated, conveyed the same idea when he said: "Any inhabitant of the territory can make good in the municipal Courts established by the new (1) 42 1.A. 229. (2) 51 I.A. 357. 491 sovereign only such rights as that sovereign has, through his officers recognised. Such rights as he had under the rule of predecessors avail him nothing. " It need hardly be stated that this passage, just like that extracted from Lord Atkinson, is wholly inconsistent with the theory that an inhabitant of a territory in which there has been a change of sovereignty carries with him a voidable title to property which inheres in him until by some positive act of the new sovereign he is divested of that right. Coming nearer to the present times we have the decision in Secretary of State vs Rustam Khan(1) which related to the enforceability of the right to certain land claimed to have been acquired under the Khan of Kalat against the British Government after the cession by the Khan of the territory which included the villages in which the lands of the respondent were situate. For the appellant the plea raised was 'Act of State ' and the decisions of the Board in Bai Rajbai 's case(2) and Vijayesingji 's case (3) were relied on. Among the submissions made to the Board on behalf of the respondent we would refer to two as of some relevance to the points under consideration in these appeals. The two contentions were: (1) that a mere change in sovereignty was not to be presumed to disturb the rights of private owners, and the terms of the cession by which full sovereignty was transferred were to be construed as passing only public property relying for this proposition on Amodu Tijani vs Secretary Southern Nigeria(4), (2) that the effect of a change in sovereignty in regard to title to land which had been perfected under a previous sovereign was different from that in regard to personal obligations. For the latter proposition support was sought on the observations of Lord Alverstone C.J. in West Rand Central Gold Mining Co. vs Rex(5) reading: "It must not be forgotten that the obligation of conquering States with regard to private pro (1) 68 I.A. 109. (2) 42 I.A. 229. (3) (4) (5). 492 perty and private individuals, particularly land to which title had already been perfected before the conqueror annexation are altogether different from the obligations which arise in respect of personal rights by contract. " We have referred to these arguments and particularly to the citation of these two decisions, because they are usually referred to in connection with a suggestion that even according to the British view rights of private individuals to land and interests in relation to land continue to be enforceable unaffected by changes in sovereignty. Lord Atkinson who delivered the judgment of the Board pointed out that the cession of the territory by the Khan constituted a complete transfer of all sovereignty to the British Government, stated: "On the legal position that arises in such circumstances there is a wealth of weighty authority." After referring in detail to the earlier decisions of the Board in Kamachee Boye(1), Cook vs Sprigg,(2) Bai Rai Bai(2) and Vijayesingji, (4) applied them to the facts and held that as the title which was asserted had not been recognised by the British Government; allowed the appeal and directed the dismissal of the suit of the respondents. If the Privy Council decisions lay down the law correctly and we are applying that law, the fact that it is land or immovable property which is claimed or as regards which the right is asserted makes no difference for the application of the principle. The last decision to be referred to in this context is that reported. as Asrar Ahmed vs Durgah Committee, Ajmer(5) where Lord Simonds said: "From this it follows that the rights, which the inhabitants of that State enjoyed against its former rulers, availed them nothing against the British Government and could not be asserted in the Courts established by that Government (1) (1859) 7 Moo. I. A. 476.13 Moo. P.C. 22. (2) (3) 42 I.A. 229. (4) 51 I.A. 357. (5) A.I.R. 1947 P. C. I. 493 except so far as they had been recognised by the new sovereign power. Recognition may be by legislation or by agreement express or im plied. This well established rule of law for which reference may be made to 42 I.A. 229 at p. 237 and 51 I.A. 357 at p. 360, appears to their Lordships to be peculiarly applicable to an office, to which material benefits apper tain and which, so far the records show, had consistently been regarded as within the dis position of the sovereign power. " As we have already pointed out, these decisions of the Privy Council have been referred to and followed by this Court in Dalmia Dadri Cement Co.(1) and the other decisions already referred. The statement of the law therefore in Virendra 's case(2) that if the doctrine of Public International Law enunciated by the Privy Council were applied, the petitioners in that case had a voidable title, which inhered in them even after the change of sovereignty, is not seen to be correct. If the view expressed by the Privy Council was to be adopted there is no escape from the conclusion, that the grantees under the previous rulers did not carry with them, on a change of sovereignty, as subjects of the succeeding sovereign any inchoate rights as against the new sovereign, but their rights in so far as enforceability against the new sovereign was concerned sprang into exist ence only on recognition express or implied by the duly constituted competent authorities of the succeeding sove reign, apart from legislation. Pausing here we might observe that this error on the part of the learned Judges in appreciating the ratio of the judgments of the Privy Council necessarily led them 'to assume that the petitioners before them had certain rights which they continued to enjoy even after the change of sovereignty and which were protected by the guarantees con tained in articles 19 and 31 of the Constitution. The next step in the reasoning of the learned Judgeswas based on the fact that the Constitution was framed not merely by the people inhabiting the Provin (1) [1959] S.C.R. 729. (2) ; 494 ces of India but as a result of their conjoint action along with the subjects of the former Indian rulers. From this the inference was drawn that those rules of Public Interna tional Law which recognised the rights of a successor State to refuse to be bound by obligations incurred by or enforce able against the predecessor State had no application to the change in sovereignty brought about when the Union of India was brought into existence. This was on the theory that for that doctrine to operate there must be a cession or transfer of territory by one ruler to another and that where the people of the entire subcontinent by their united action brought into existence a new sovereign State there was no question of transfer of territory from one sovereign to an other to afford scope for the application of the rule of Public International Law. With the greatest respect to the learned Judges, we feel constrained to differ. that a new sovereign emerged on the unification of India by the merger or absorption of the Indian States with the Provinces of British India cannot be questioned and that this was by the process of the sove reignty of the rulers of the former Indian States being extinguished cannot be disputed either. We are here not concerned with whether India as an International person has undergone any change, vis a vis in its relationship with other States or in the International Organisations but in a more limited and, so to speak, domes tic sphere. The territories under the rulers of the former Indian Princes undoubtedly passed from one sovereign to another when as a result of the 'unionisation ' by the Government of India, they became integral parts first of the Dominion of India and later of the Union of India. A transfer of territory from under one sovereign to another may be effected in a variety of ways conquest, annexation, by cession under a treaty after a war or without a war, by revolution by emancipation of subject peoples and by territorial resettlements. These changes possess one common feature viz., that one sovereign ceases to rule a territory and another takes its place. For the application of the rules which have been evolved in connection with the problems arising from such succession, little turns for the purpose of British Constitutional Law on either the manner in which the change of 495 sovereignty was brought about or whether the absorption was partial or complete in the sense of a total extinction of the previous sovereignty of the absorbed State, leaving no trace of survival after the merger. In passing we might mention that, in fact. it was in most cases the rulers of the Indian States who ejected the merger and who on behalf of their State and their subjects participated by themselves or through their representatives in the deliberations which brought into existence the Constitution, and the legal and political unity of India. If, then, as a result of the absorption there was a State succession, its consequences have to be judged by tests or principles similar to those by which State succession is brought about by other means. We cannot, therefore, agree that the manner in which the Indian States ceased to exist or in which the Constitution and with it the complete political unification of the territory of India was brought about negatives the applicability of rules which govern the enforceability of rights against a succeeding sovereign on State succession. The point next to be considered is whether the fact that the subjects of the former Indian rulers became, after the Constitution, citizens and subjects of the Indian Union pre cludes the Indian Government from refusing recognition to titles which such persons could have enforced against their previous rulers on the well accepted principle that "there can be no act of State against its own subjects. " The appli cation of this principle last mentioned of which Walker vs Baird(1) and Johnstone vs Pedlar(2) are classic examples, is intimately bound up with the question as to the precise nature of the action taken by a succeeding State, when it refuses to accord recognition to the right of a former in habitant of the territory of an earlier sovereign and enforce.able against the predecessor. If the true position in law were that a positive action is necessary to be taken by the succeeding sovereign before it interferes with the pre existing rights of the subjects of the former ruler and that the action thus taken is really a continuance of the act of the State by which the territory of the former ruler became transferred to the new sovereign, it is possible that the rule that there can be no act of State by (1) (2) ; 496 the Government against its own subjects might have some application. But if, on the other hand, the true theory were, that on the extinction of the sovereignty of the previous ruler over the territory ceded or surrendered, there is an extinction ipso jure of the rights enforceable against the State and that it is really a new right that springs into existence on recognition by the succeeding sovereign, it would be manifest that the refusal of the succeeding sovereign to recognise preexisting rights could in no sense be an act of State. No doubt, that refusal is in the exercise of sovereign power but by such exercise it neither annihilates nor affects any enforceable right which its subjects had against it. We consider, therefore, that if the doctrine of Public International Law expounded by the Privy Council were held applicable to the termination of the rights arising on the change of sovereignty in India, as the learned Judges in Virendra Singh 's case(1) did, the power of the Government of India as at present constituted to refuse to recognise titles originating in executive grants by former Indian rulers cannot be negatived by resort to the rule of law laid down in Walker vs Baird(2) and Johnstone vs Pedlar(3). The next proposition of law which underlies the decision in Virendra Singh 's case(1) is that the arbitrary and absolute powers which the former Indian rulers possessed to revoke grants made by them did not survive the change in sove reignty brought about by the Constitution, when as a result of the setting up of a democratic polity informed by justice and the rule of law, the right to exercise any arbitrary power was abandoned and was no longer available for revoking the grants made by the former rulers. If the theory of Pub lic International Law which was explained and given effect to by the decisions of the Privy Council rested on the doc trine that the powers of the succeeding sovereign to recog nise or not to recognise grants by the preceding sovereign or to repudiate them was based on the rights of the previous ruler so to revoke or repudiate, the argument would have considerable force. The juristic basis of the theory underlying the Privy Council decisions is that with the extinction of the previous sovereign the rights theretofore exercisable (1) ; (2) (1892] A.C. 491. (3) ; 497 by the subjects of that sovereign were likewise extinguished and that without recognition which is really tantamount to a fresh grant by the new sovereign, no title enforceable in the municipal courts of the succeeding sovereign came into being. If this latter be the correct juristic approach, and that is what the decisions of the Privy Council lay down as we have shown by the extracts we have made of the relevant passages in Bai Rajbai 's(1) and in Vajeysinghji 's(2) case, then it matters not whether the earlier grant was by an absolute ruler who could revoke his grant or by a ruler of a different type who could not or even if he could, had re nounced his rights to revoke by unilateral executive action. In either case, where the question at issue is whether the right could be enforced against the succeeding sovereign in its courts, nothing turns on the power of the preceding ruler to derogate from his grant; for it is not by virtue of any power derived from the previous sovereign that the succeeding sovereign claims the right not to recognise the earlier rights or grants but as an incident of its own sovereignty and sovereign power. In the circumstances, the existence of the arbitrary powers of the native Indian rulers and its absence in the Governments under the Constitution is not relevant, nor the fact that these were not inherited by and did not devolve on the Governments of the Union and the States functioning under the Constitution. The last of the steps in the reasoning underlying Virendra Singh 's case(1) proceeds on the basis that the petitioners had brought with them from their previous rulers into the Indian Union certain rights in the property granted to them, enforceable against the Government in regard to which they were entitled to the protection of articles 19 and 31. This question has to be approached from two points of view arising from the two stages through which the territory of the former Indian rulers became part of the territory of India under the Constitution. The first stage is concerned with the effect of the changes which took place from the accession of the States to the Dominion of India followed by the merger agreement executed by the rulers all of which were governed by the provisions of the Government of India (1) 42 I.A. 229. (2) 51 I.A. 357 (3) ; 134 159 S.C 32 as it stood from time to time and the second stage with the complete 'unionization ' of these territories so as to form part of an unified polity, the Union of India. So far as the first stage is concerned, there was certainly a transfer of sovereignty over the territory of the former Indian rulers to the Government of India for the purposes of the exercise by the latter of sovereignty with plenary powers of administration. Sections 290A and 290.B were introduced into the Government of India Act for enabling the administration by the Dominion Government of the territories of the acceding States which under section 5 of that Act became part of the Dominion of India. At this stage the powers of the Government of India for the administration of the acceding territories were exercised under the Extra Provincial Jurisdiction Act (Act XLVII of 1947) which used the phraseology 'areas outside Provinces which were acquired by the Central Government by treaty, agreement, grant, usage, sufferance or other lawful means '. It may be mentioned that under orders made by virtue of powers conferred by the Extra Provincial Jurisdiction Act all laws theretofore in force prevailing in the territories which were being administered under that Act were continued in force. Later by an order issued under section 290A of the Government of India Act, known as the States Merger Order 1949, laws in operation in the merged States, were continued until repealed or modified. If in that situation the law as to acquired rights enforceable against the successor State as enunciated by the Privy Council applied, all grants which rested solely on executive action could acquire vitality for being enforced against the administration by the Government of India or its delegates only if those rights were recognised; for there was here a true case of State suc cession transfer of territory by one sovereign to another and without the complication arising from the fact that the rulers or the people of the various Indian States participating in the making of the Constitution which the people of India gave to themselves. We have already ex plained that if the view of the Privy Council as to the effect of a change in sovereignty were accepted, it un mistakably points to their being no survival of any vestige of rights on the extinction of the sovereignty of the previous 499 ruler and to the emergence of any right only by the action express or implied of the new sovereign. If this principle were applied, there would have been no rights of property vesting in the grantee which he could assert against the new ruler. No doubt, if the grantees were in possession they would have a right to retain their possession against private trespassers but that is not the question with which we are here concerned, for what is now under consideration is the capacity of these grantees to assert rights as against the Government which is totally different from their right to possession as to the rest of the world. Digressing a little it may be pointed out that section 299 of the Government of India Act, 1935 as well as articles 19 and 31 which are referred to in this connection deal exclusively with the inference with proprietary rights by the State and have nothing to do with rights inter se between the grantee and his fellow subjects or citizens. If, therefore, we are correct in our understanding of the decisions of the Privy Council that on a change of sover reignty no scintilla of right inhered in the grantee quoad his right to assert or enforce his rights under the grants against the rulers survived the change of sovereignty, the guarantee against deprivation of property contained in section 299 of the Government of India Act, 1935, availed him nothing, for when the succeeding sovereign refused to recognise the rights obtained by him under the previous sovereign its action deprived him of no right to property; because he brought with him no rights from the previous ruler which he could assert against the new sovereign. The position, therefore, reduces itself to this: Just previ ous to the Constitution the grantee had no right of property enforceable against the State and in regard to which, there fore, he could invoke the protection of articles 19 and 31 of the Constitution. The coming into force of the Constitution could not, therefore, make any difference; for the Con stitution does not create rights in property but only protected rights which otherwise existed. It is necessary to add that if the learned fudges in Virendra Singh 's case(1) were right in their understanding of the Privy Council decision to (1) ; 500 mean that a grantee under the previous ruler had a voidable title which he continued to possess and enjoy until by action of the succeeding ruler the same was revoked or repudiated, they might also be right in their conclusion that such title as the grantees had could not be extinguished by the executive action of the Union or of the State Governments because of the guarantee of the right to property contained in articles 19 and 31. But, if as we have shown, the decisions of the Privy Council do not lend support to such a view, the conclusion in Virendra Singh 's case(1) as regards this last proposition also cannot be correct. This takes us to the consideration of the question which was raised by Mr. Purshottam Tricumdass submitting to us that we should discard the theory of Public International Law which underlies the decisions of the Privy Council. but that we should accept and give effect to what might be termed the American view as formulated by Chief Justice Marshall in U.S. vs Percheman(2) which was approved and applied in the later decisions of the American Supreme Court to which also he drew our attention. Learned Counsel submitted that this Court was not bound by the decisions of the Privy Council and was free to adopt the more rational, just and human doctrine which found expression in these American decisions. In this connection his thesis was that the doctrines evolved by the Privy Council were conditioned by Britain being an Imperialist and expansionist power at the date when they originated and were applied and that while these might have been suited to the regime of a colonial power, they were wholly out of place in the set up of this country and with the type of Constitution under which it functions. Having considered this matter carefully we are clearly of the opinion that there is no justification or reason to dis card the British view as regards the jurisdiction of municipal courts to enforce rights against succeeding sovereigns on a change of sovereignty. In the first place, Percheman 's case(2) itself came before the courts for ascertaining the proper construction of the treaty under which Florida was surrendered to the United States by Spain under the Florida treaty dated February 22, 1819, on the terms of which the (1) ; (2) ; at pp. 86 87. 501 respondent contended that his title to the property claimed by him had been recognised and confirmed. The place of a treaty entered into by the United States and the provisions contained in it, in the Constitutional Law of the United States, we shall be referring to later, but that apart the Florida treaty was followed by an Act of Congress of 1828 ,entitled "an Act supplementary to the several Acts provid ing for the settlement of confirmation of private land claims in Florida. " Under the terms of this Act of the Congress, ,Commissioners were set up to investigate claims by private individuals to lands and in cases where the validity of a claim set up was not upheld by the Commissioner, provision was made for resort to courts for resolving the dispute. There was, therefore, no scope for invoking the British rule of the lack of jurisdiction of municipal courts to adjudicate on unrecognised titles to property, even if such a doctrine was applicable and the only point in controversy was as to the interpretation of the clauses of the treaty relative to the titles which were recognised because on any view of the law if the treaty and the Act of Congress confirmed the respondent 's title, the same was enforceable in the municipal courts of the United States. Before passing on from this decision it is necessary to bear in mind the difference in constitutional law prevailing in the United States and in India as regards the effect of treaties and the provisions contained therein. article 6 cl. (2) of the United States Constitution reads: "6. . . . . (2) All treaties made, or which shall be made, under the authority of the United States, shall be the supreme law of the land; and the Judges in every State shall be bound thereby, anything in the Constitution or laws of any State to the contrary notwithstanding." Willoughby explains* the object. and effect of this provision thus: ". the primary purpose of this provision, (article VI cl. (2) was to make indubitable the supremacy of treaties over State Statutory or *Constitution of the United States Vol. 1, 548. 502 constitutional provisions. it has, from the beginning been held that treaties, so far as they are self executory, operate in the United States, by virtue of this constitutional provision, to create municipal law which the courts are called upon to recognise and apply. " In the United Kingdom and in India the position is entirely different. A treaty is, in British jurisprudence, treated merely as a contract between two States and does not become a part of the law of the land unless by an express Act of the Legislature. A treaty does not confer rights or obligations between the State and its subjects or as between Subjects, such rights can be conferred only by an enactment of the Legislature. As explained by Lord Atkin in Attorney General of Canada vs Attorney General of Ontraio(1): "Unlike some other countries the stipulations of treaty duly ratified do not within the Empire, by virtue of the treaty alone have the force of law" It was in recognition of this constitutional position that section 106 of the Government of India Act, 1935 was enacted. Its terms are in substance re enacted in article 253 of the Constitution which reads: "253. Notwithstanding anything in the foregoing provisions of this Chapter, Parliament has power to make any law for the whole or any part of the territory of India for implementing any treaty ' agreement or convention with any other country or countries or any decision made at any international conference, association or other body." and to reinforce this position we have article 363 by which municipal courts are deprived of jurisdiction to enforce any rights arising from certain treaties. It would be apparent that in the context of the different constitutional position regarding treaties in the two countries, the rule of law which was enunciated by the American Supreme Court, cannot automatically be applied here. For in ultimate analysis the court in Percheman 's case (2) was giving effect to provisions (1) at P. 347. (2) ; at pp. 86 87. 503 of the treaty with Spain which was the law of the land, and if the treaty provisions were different, these again would have been enforced by the courts. We are making this observation not to minimise the importance of the doctrine of Public International Law explained by Chief Justice Marshall, but to point out that the decision must be under stood in the setting of the provisions of the treaty with Spain and the articles of the American Constitution. As indicated earlier, we are not insensible to the position that apart from the place of treaties in American Con stitutional Law what Marshall C.J., expounded was a doctrine of Public International Law which lie considered it was necessary; just and proper for succeeding States to observe in their dealings with the rights acquired by private individuals under predecessor sovereigns. We shall now proceed to deal with the question whether we should discard the rule as enunciated in the decisions of the Privy Council and adopt that which was formulated in Percheman 's case(1). There are several reasons why we are unable to accept C. J. Marshall 's exposition in Percheman 's case(1) as laying down a law which has to be given effect to by municipal courts in this country. In the first place, it could not be said that the broad terms in which Marshall C.J., stated the doctrine that every private rights derived from a predecessor sovereign ought to continue to be enforceable against a successor sovereign and that a change in sovereignty makes no difference to the enforceability of private rights, be it against other individuals or the succeeding State, has been in that absolute form accepted as valid by jurists and writers on Public International Law. Even in treaties in Public International Law in which the most extended scope has been afforded to the enforceability of acquired rights against a successor State two limitations have always been recognised: (1) that the origin of the right should be bona fide and not one designed to injure the economic interests of the successor State, and (2) that the right should not be a political concessions Next, jurists and even the Permanent Court of International Justice have drawn a marked distinction between (1) ; at pp. 86 87. 504 that might be termed the theory of the law and the enforce bility of these rights and in municipal courts. C.C. Hyde in is treatise on Public International Law(*) after referring of the decision in Percheman 's case(1) and those which allowed it adds: "Acknowledgement of the principle that a change of sovereignty does not in itself serve to impair rights of private property validly acquired in areas subjected to a change, does not, of course, touch the question whether the new sovereign is obliged to respect those rights when vested in the nationals of foreign States, such as those of its predecessor. " Similarly George Schwarzenberger in his International Law(**) after referring to a passage in the decision of the Permanent Court of International Justice in the case of German Settlers in Poland reading: "Private rights acquired under existing law do not cease on a change of sovereignty. No one denies that the German Civil Law, both sub stantive and adjective, has continued without interruption to operate in the territory in question. It can hardly be maintained that, although the law survives, private rights acquired under it have perished. Such a contention is based on no principle and would be contrary to an almost universal opinion and practice" adds that though the Permanent Court of International Jus tice negatively stated that private rights acquired under existing law do not cease on a change of sovereignty, the Court did not expressly pronounce on the question whether in the absence of legislation to the contrary on the part of Poland, she was bound by International Law to consider German Civil Law as valid in the ceded territories. The doctrine of act of State evolved by English Courts is one purely of municipal law. It denies to such a Court jurisdiction to enquire into the consequences of acts which are inseparable from an extension of its sovereignty. That doc (*) Vol. IP. 433. (**)Vol. 1 p. 83. (1) ; at Pp. 86 87. 505 trine was, however, not intended to deny any rule of inter national law. Next we might examine the juristic concept underlying the American view, putting aside for the moment what one might call authority. There has been at one time a school of thought among writers on Public International Law which has described the process of State succession as if it were a transmission of sovereignty bringing in for this purpose the analogy of an heir in private law clothing the successor with the totality of the rights and obligations qua all inhabitants without exception or modification. This theory has now been discarded because of the realisation that there could be no analogy between individuals and States, nor could the theory be sustained in the face of the circumstance that it does not accord with practice, which after all is one of the basic foundations of the rules of Public International Law. It is hardly necessary to add that 'there is here no inconsistency with the comity of nations. Nor could it be maintained that the theory is just, because it would force upon the successor State obligations which might have owed their birth to political considerations which would not survive the predecessor State. Besides, it must not be forgotten that when a successor State exercises its sovereignty even over territory which has passed to it from a preceding ruler, it does not do so as a representative of or by delegation from the latter as in the case of the heir in Private Law, but as a sovereign of the territory deriving authority from its own constitution and set up. It is true that Public International Law might lay on the successor State duties with respect to the acquired territory and to the rights of the inhabitants thereof but those must be compatible with its undoubted sovereignty. It is in recognition of such a position that successor States give effect to laws which regulate rights inter se between the subjects which theretofore applied, save in so far as either its constitution or its legislation has made other provision. We are, however, here concerned with rights possessed by individuals in the predecessor 's territory enforceable against the previous rulers and even as regards these we are concerned with a very limited range of rights rights arising out of grants of immovable property or concessions of rights in relation thereto and 506 enforceable against the predecessor State. We made this Reservation because in the Dalmia Dadri Cement case(1) which dealt with the continued enforceability of a concession regarding the levy of income tax, even Bose J. agreed that such rights did not survive and in a separate judgment confined the operation of the principle that he enunciated in Virendra Singh 's case(2) to rights of immovable property. If the theory that rights and duties or rather the bundle of them pass ipso jure from the predecessor to the successor State is discarded and at the same time it is recognised that International Law and justice which underlies that body of law might impose some obligations which the successor State should respect, two questions arise: First what are the obligations which International Law might impose? and secondly, whether these obligations which are not the crea tures of municipal law, might give rise to claims enforceable in municipal courts. It is impossible to lay down exact rules as to the inter ests which are protected by a consensus of opinion as acquired rights. So much, at least, is clear that to receive the protection of International Law the interest must have been properly vested in the sense that it must not have been voidable at the instance of the predecessor State and bona fide and legally acquired. Neither the comity of nations, nor any rule of International Law can be invoked to prevent a sovereign State from safeguarding its national economy and taking steps to protect it from abuse. On the one side the principles of acquired rights demands that the interest of the private individual be not abrogated and on the other side the public interest of the successor State has to be considered. It is this conflict between the public and private aspects that hinders the laying down of hard and fast rules. As has been pointed out by O 'Connell in his Treatise on the Law of State Succession, the problems posed by State succession in International Law are notably different in character from those of municipal law though they arise at a different plane, but there is no necessary reason why the one system should not draw on the doctrine or concepts formulated and found to be adequate within the other (1) [1959] 729. (2) ; 507 system. The principle of universal succession based on ana logy from the civil law was essentially juristic in character, but the analogy was wrong and the practice of States was not consonant with the theory. The rejection of this doctrine led to the assumption that solutions are to be found on experience alone. The choice of the appropriate theory by writers was ' coloured by their standpoint and their legal (Experience. In theory, therefore, we must have regard both to past experience and the necessities of the present and while on the one hand not being unduly restrictive, ought not on the other become so doctrinaire as to deprive the State of the option not to recognise even mala fide transactions. Looked at from this point of view the British practice that has prevailed in this country has not proved in actual practice to lead to injustice, but has proceeded on a just balance between the acquired rights of the private indivi dual and the economic interests of the community, and therefore there is nothing in it so out of tune with notions of propriety or justice to call for its rejection. It is undoubted that the British doctrine was part of the jurisprudence and the constitutional practice that prevailed in pre Constitution India. Most certainly it does not need to be stated that the British Parliament when it enacted the Government of India Act as the constitutional framework by which this country should be governed, could not have had in contemplation any other rule by which the rights of the inhabitants newly brought into the political set up by other territories becoming part of India. With this historical background it would not be a violent presumption if we assume that the framers of the Constitution should also be taken to have proceeded on the basis of the acceptance of this doctrine and this state of the law, unless one found some provision or indication in the Constitution repugnant to its continuance. As already pointed out, the position of treaties vis a vis municipal law was not changed. On the other hand, by article 363 an embargo was laid in express terms on municipal courts giving effect to the provisions of treaties with rulers of Indian States. This, in our opinion is a clear indication that the Constitution makers intended no 508 departure from the Constitutional doctrine that was thereto fore accepted as law. It would, of course, be different if the provisions of any treaty became embodied in subsequent legislation; then they would be enforced as part of the law of the land. It is also not to be assumed that the Constitution makers were oblivious of the need for continuity of the law when the Indian States were absorbed and a change in sovereignty took place. By article 372 of the Constitution all the laws which were in force in these States just as in British India without any distinction were continued until they were altered or repealed by competent legislation. It is only necessary to point out that in the interval between the merger of these States and the coming into force of the Constitution, there were other provisions to which we have already adverted which continued the laws which obtained in these territories till article 372 could be availed of. There was thus no legal vacuum or hiatus created so far as laws were concerned and it is only where the right sought to be enforced was created not by the laws of the previous sovereign but merely as a result of an administrative order that we have the problem to be solved in these appeals. If the definition of law in article 366(10) were as that in article 12 so as to include even executive orders every right, however, created would have been continued. But the Constitution makers decided otherwise and preferred to continue only laws as distinguished from administrative orders. Next we have the circumstance that the doctrine enunciated in the decisions of the Privy Council have been accepted as correct and thus applicable equally in postConstitution India in a series of decisions of this Court commencing from Dalmia Dadri Cement Co.(1) and unless compelling reasons are found for holding that all these were wrongly decided, it would be neither proper or even open for us to depart from these precedents, and as explained earlier, there are none. Lastly, as we have already noticed, even in the case of Virendra Singh(2), though the divergent views of the jurists on this question of Public International Law were set (1)(1959] S.C.R. 729. (2) ; 509 out the court did not express any decisive opinion in favour of accepting the observations in Percheman 's case(1) as proper to be applied by the municipal courts in India. In the face of these circumstances we would not be justified in departing from the decisions of the Privy Council which have been accepted and applied by this Court. These decisions both of the Privy Council as well as the earlier ones of this Court were reviewed and the propositions laid down in them were examined and summarised by this Court in Promod Chandra Deb and Ors. vs The State of Orissa and Ors.(2) as laying down the following propositions: "(1) 'Act of State ' is the taking over of sovereign power by a State in respect of territory which was not till then a part of its territory, either by conquest, treaty or cession, or otherwise, and may be said to have taken place on a particular date, if there is a proclamation or other public declaration of such taking over. (2) But the taking over full sovereign powers may be spread over a number of years, as a result of a historical process. (3) Sovereign power, including the right to legislate for that territory and to administer it, may be acquired without the territory itself merging in the new State, as illustrated in the case of Dattatraya Krishna Rao Kane vs Secretary of State for India in Council [(1930) L.R. 57 I.A. 318]. (4) Where the territory has not become a part of the State the necessary authority to legislate in respect of that territory may be obtained by a legislation of the nature of Foreign Jurisdiction Act. (5) As an act of State derives its authority not from a municipal law but from ultra legal or supra legal means, Municipal Courts have no power to examine the propriety or legality of an act which comes within the ambit of 'Act of State. ' (1) 32 U.S. at pp. 86 87. (2) [1962] 1 Supp. S.C.R. 405. 510 (6) Whether the Act of State has reference to public rights or to private rights, the result is the same, namely, that it is beyond the jurisdiction of Municipal Courts to investigate the rights and wrongs of the transaction and to pronounce upon them and, that therefore, such a Court cannot enforce its decisions, if any. It may be that the presumption is that the pre existing laws of the newly acquired territory continue, and that according to ordinary principles of International Law private property of the citizens is respected by the new sovereign, but Municipal Courts have no jurisdiction to enforce such international obligations. (7) Similarly, by virtue of the treaty by which the new territory has been acquired it may have been stipulated that the pre cession rights of old inhabitants shall be respected, but such stipulations cannot be enforced by individual citizens because they are no parties to those stipulations. The Municipal Courts recognised by the new sovereign have the power and the jurisdiction to investigate and ascertain only such rights as the new sovereign has chosen to recognise or acknowledge by legislation, agreement or otherwise. (9) Such an agreement or recognition may be either express or may be implied from circum stances and evidence appearing from the mode of dealing with those rights by the new sovereign. Hence, the Municipal Courts have the jurisdiction to find out whether the new sovereign has or has not recognised or acknow ledged the rights in question, either expressly or by implication, as aforesaid. (10) In any controversy as to the existence of the right claimed against the new sovereign, the burden of proof lies on the claimant to establish that the new sovereign had recognised or acknowledged the right in question. " 511 We consider this summary succinctly expressed the rule to be applied in this country as regards the, enforceability against the Governments in India of private rights originat ing in executive or administrative orders of the former Indian rulers. The next matter to be considered is the correctness of the view expressed by the High Court, that even though the treaty be an Act of State, and the merger agreement executed by the ruler a document on which no rights enforceable in municipal courts could be based, still cl. (7) of the letter of Shri V. P. Menon dated October 1, 1948 could be referred to and relied upon for founding an argument that the Government waived their right to repudiate the grant made by the previous ruler. We consider that the submission of the learned Attorney General that the learned Judges were in error in this respect is well founded. If the treaty or its provisions cannot be looked at to spell out any right. as the learned Judges themselves conceded. the use to which they have put the provisions of cl. (7) that the Government would not re examine grants made earlier than April 1, 1948, is virtually the same though called by another name. We can see no sensible distinction between reliance on the provisions of the treaty as pointing to a recognition by the Government of rights claimed and reliance on it for the pur pose of establishing that Government had waived their right not to recognise such rights. In substance, they are the same though the nomenclature employed is different. In support of the reasoning on which this distinction was accepted the learned Judges have placed reliance on the approach to this question in Virendra Singh 's case(1). We have discussed this matter fully in the earlier part of this judgment and there is no need to repeat it. The learned Judges have further referred to and relied on a decision of this Court in Bholanath vs The State of Saurashtra(2) and certain observations contained in it. We do not agree that the observations in the decision, though couched somewhat widely could properly be understood in the manner in which the learned Judges have done. The question that arose in the case was whether the condition of service of a person (1) ; (2) A. I. R. 512 originally employed as an officer of one State continued to govern his services after that State became merged in the Government of Saurashtra. The condition of service in controversy was as to the age at which an officer had to retire on superannuation. By an enactment of the ruler of Wadhwan State this was, in the case of officers like the appellant before this Court, fixed at 60. An order by the Government of Saurashtra retiring him after he reached the age of 55 against his will, gave rise to the suit from which the proceedings before this Court arose. There was contro versy in the Courts below as to whether the law embodying the service conditions was competently enacted by the Wadhwan State. But this contention was not persisted in this court, and the court recorded a finding that the terms of service of the appellant were regulated by a law which was competently enacted and that the law was continued by article 372 in the Saurashtra State. On that finding there could really be no defence to the appellant 's claim. The decision in favour of the appellant was rested on the ground that the law of the Wadhwan State was continued by express provisions contained, first, in statutes of the Saurashtra State and, again, by article 372 of the Constitution when the latter merged in the Dominion of India. On this it followed that without a valid change in the law the rights of the appellant could not be restricted. In stating this position, however, the following words were used: "The Covenant (between the ruler of the Wadhwan State and the State of Saurashtra) could be looked at to see whether the new sovereign had waived his rights to ignore rights given under the laws of the former sovereign. " We do not understand this passage to mean that the covenant which under article 363 could itself not be looked at for founding any right, could be used indirectly for inferring that rights were recognised, without anything more. The true position appears to us to be that where the new sove reign assumes jurisdiction and it does some Act and there is ambiguity as to whether the same amounts to a recognition of a pre existing right or not, the covenant and the treaty might be looked at in order to ascertain the intention and purpose of that equivocal act, but beyond this the cove 513 nant and the treaty cannot by themselves be used either as a recognition pure and simple or, as the learned Judges of the High Court have held, as waiver of a right to repudiate the pre existing rights. It is needless to point out that since the enforceability of the rights against the succeeding sovereign springs into existence only on recognition by the sovereign, there is no question of a waiver of the right to repudiate. The expression 'right to repudiate ' in this con text is a misnomer and there could be no question of a waiver of such right. This, however, does not conclude the matter, for we have still to deal with the question whether the grant by the ruler of the Sant State which was embodied in a 'resolution ' of his was a "law" or was merely an executive or administra tive order. Learned Counsel for the respondent submitted to us that the grant under the Tharav No. 371 dated March 12, 1948 was not a grant by executive power but was in truth and substance a law which was continued by article 372 of the Constitution and which, therefore, could be undone only by legislation and not by any executive fiat as has been done in the present case and in this connection relied strongly on the decisions of this Court in Madhaorao Phalke vs The State of Madhya Bharat(1) and in Promod Chandra Deb and Ors. vs The State of Orissa and Ors. Both in the trial Court as well as before the High Court the cases had proceeded on the footing that the ruler of the Sant State was an absolute monarch with no constitutional limitations upon his authority, and it was not suggested that this was incorrect. He was the supreme legislature as well as the supreme head of the executive so that his orders however issued would be effective and would govern and regulate the affairs of the State including the rights of the citizens; (vide Ameer un nissa Begum vs Mahboob Begum(3) and Director of Endowments, Government of Hyderabad vs A kram Ali(4) We should, however, hasten to point out that though in the case of such absolute monarchs the distinction between the administrative action under their executive power and laws passed by them as the supreme legislature (1) ; (2) [1962] 1 Supp. S.C.R. 405. (3) A.I.R. 1955 S.C. 352. (4) A.I.R. 1956 S.C. 60. 134 159 section C. 33. 514 of the State, possess no deference as regards their effectiveness, still the distinction between the two is of vital importance for the purpose of determining their continued efficacy after the coming into force of the Constitution. Under article 372 of the Constitution "all the law in force in the territory of India immediately before the commencement of this Constitution shall continue in force therein until altered or repealed or amended by a competent Legislature or other competent authority". The expression "existing law" is defined in article 366(10): "Existing law means any law, Ordinance, Order bye law, rule or regulation passed or made before the commencement of this Constitution by any legislature, authority or person having power to make such a law, Ordinance, Order, bye law, rule or regulation. " This definition would include only laws passed by a competent authority as well as rules, bye laws and regulations made by virtue of statutory power. It would therefore not include administrative orders which are traceable not to any law made by the Legislature but derive their force from executive authority and made either for the convenience of the administration or for the benefit of individuals, though the power to make laws as well as these orders was vested in the same authority the absolute ruler. What survives the Constitution and is continued by article 372 are those laws which could trace their origin to the exercise of legislative power. The problem next is to discover that which is "law" from that which is merely an executive order and this is by no means an easy one to solve. In the case of some States where there are rules which prescribe particular forms which the laws have to or generally take or where laws as distinguished from executive orders are issued bearing a defined nomenclature, there is not much difficulty. But the cases which have come up before this Court have shown that this is by no means the universal rule. In the case of the Sant State with which we are concerned it was not suggested that there was any particular formality or process 515 which had to be observed in the promulgation of laws or any particular form which laws had to take or took or that they went by any particular nomenclature to distinguish them from executive or administrative orders. We have, therefore, to consider whether from the nature of 'the instrument its contents and its general effect whether the Tharav dated March 12, 1948 constitutes a law within article 366(10) and is therefore continued by article 372 or whether it is merely an executive grant or administrative order which might confer rights but which without recognition by the Union or State Government cannot be enforced in the municipal courts of this country. We shall therefore proceed to consider the terms of the Tharav and for this purpose it would be convenient to set it out in full. It is headed 'Tharav Order ' by Maharana, Santrampur State, dated March 12, 1948. It was explained to us that the expression of 'Tharav ' meant a resolution. The text of this resolution or order by the Maharana is as follows "The Jivak, Patavat Inami, Chakariyat, Dharmada villages in Sant State are being given (granted) to Jagirdars and the holders of the said villages are not given rights over forests. Hence after considering the complaints of certain Jagirs, they are being given full rights and authority over the forests in the villages under their vahivat. So, they should manage the vahivat of the forest according to the policy and administration of the State. Orders in this regard to be issued. Sd/ in English Maharana, Santrampur State. " There are a few matters to which it is necessary to advert in this document : The first of them is that it is not a grant to any individual, that is, treating him as an individual or as one of a number of individuals or to a group 516 treating them merely as separate individuals, but to the holders of five specified tenures in the State Jivak, Patavat, Inami, Chakariyat and Dharmada villages. Next, it states that the rights in the forests of the villages of the several kinds of tenure holders are being given to them in response to the representations made in regard to the villages in the possession and enjoyment of the Jagirdars as regards this matter. Lastly, the tenure holders were directed to manage and administer the forest according to the policy and administration of the State. The learned Judges of the High Court have treated the 'Tharav ' as merely an administrative order treating it as if consisted of as many grants of forest rights to the tenure holders as there were such holders and this was the view that was stressed upon us strongly by the, learned Attorney General. We are, however, not impressed by this argument. We have no evidence as regards the creation of the several tenures referred (to in the Tharav to base any conclusion as flowing from the original grant. No doubt, there is on record the translation of the rant of the village of Gothimada dated 1867, but from this it does not follow that everyone of the grants comprised in the ' five tenures specified was of this pattern, We consider that the 'Tharav ' is more consistent with its being a law effecting an alteration in the tenures of the five classes of Jagirdars by expanding the range of the beneficial enjoyment to the forests lying within the boundaries of the villages which had already been ranted to them. In this light, the 'Tharav ' would not be an administrative order in any sense but would partake of the character of legislation by which an alteration was effected in the scope and content of the tenures referred to. This aspect is reinforced by the reference to the complaints of the tenure holders whose grievance apparently was that though villages had been granted to them for their enjoyment under the several tenures, they were not permitted any rights in the forests within their villages. It was not thus a case of an individual grant but the yielding by the ruler to the claims of these large group of Jagirdars who requested that their rights should be extended. Lastly, the manner of the enjoyment was specified as having to be in accordance with the policy and administration in the 517 State. It is obvious that there must have been some rules which have the force of law as regards the administration of these forests and the enjoyment by the Jagirdars was made subject to the observance of these laws. We, therefore, consider that the 'Tharav ' dated March 12, 1948 satisfies the requirement of a "law" within article 366(10), and in consequence, the executive orders of the Government of Bombay by which the forest rights of the plaintiffs were sought to be denied were illegal and void. The result is that we agree with the learned Judges that the plaintiffs were entitled to succeed, though for different reasons, and we direct that the appeals should be dismissed. The appellant will pay the costs of the respondents one set of hearing fees. SUBBA RAO J. I have had the advantage of going through the judgment of my learned brother, Rajagopala Ayyangar J. I agree with him that exhibit 192 is law and that it continued in force after the making of the Constitution. This conclusion would be enough to dispose of the appeals. But, Rajagopala Ayyangar J., further expressed his disagreement with the unanimous view propounded by this Court in Virendra Singh vs The State of Uttar Pradesh(1). As I regret my inability to share his view, I shall state the reasons for my agreement with the decision in Virendra Singh 's case. As the question raised is common to all the appeals, it is enough if I take up Civil Appeal No. 182 of 1963 for consideration. The facts necessary to appreciate the alternative contention may now be briefly stated. In the year 1947, the then ruler of the Sant State made a grant of the village Gotimada to the predecessor in interest of Thakor Sardarsingh Gajesing. On August 15, 1947, India obtained independence. Under section 7 of the Indian Indepen dence Act, 1947, the suzerainty of the British Crown over the Indian States lapsed, with the result the Sant State became a full sovereign State. On March 12, 1948, the Maharana (1) ; 518 of Sant State issued an order conferring full rights over forests to the holders of villages in the State, which included the said Gotimada village. On March 19, 1948, there was an agreement, described as the Merger Agreement entered into between the Maharana of Sant State and the Dominion Government of India where under the Maharana ceded to the Dominion Government full exclusive authority, jurisdiction and power for and in relation to the governance of the Sant State and agreed to transfer the administration of the Sant State to the Dominion Government on June 10, 1948. It was also agreed that as from June 10, 1948, the Dominion Government would be competent to exercise full and exclusive authority, jurisdiction and powers for and in relation to the Governance of the Sant State in such manner and through such agency as it might think fit. Under the other articles of the said agreement certain personal rights and privileges of the Maharana were preserved. After the merger, under section 3 of the Extra Provincial Jurisdiction Act, 1947, the Government of India delegated the administration of the Sant State to the State of Bombay. From October 1, 1949, under the States ' Merger (Governor 's Provinces) Order 1949, the said State became part of the State of Bombay; that is to say, from June 10, 1948 to October 1, 1949 the Bombay State administered the Sant State as a delegates of the Dominion of India, and thereafter the State became merged with the State of Bombay. The Sant State, therefore, became part of the Dominion of India on June 10, 1948 and thereafter the citizens of that State became, the citizens of the Dominion of India. On August 21, 1948 the respondent entered into a contract with Thakor Sardarsing Gajesing for cutting of the trees in the forest of village Gotimada. On October 1, 1948 i.e., 4 months after the merger and more than a month after the said contract, Shri V. P. Menon, Secretary to the Government of India, Ministry of States, wrote a letter to the Maharana of Sant State expressly declaring that no order passed or action taken by the Maharana before the date of making over the administration to the Dominion Government would be questioned unless the order was passed or action taken after the 1st day of April 1948, and if considered by the Government of India to be palpably unjust or unreasonable. By that letter it was also guaranteed that, 519 among others, "the enjoyment of ownership" of jagirs, grants etc., existing on April 1, 1948 would be respected. A combined reading of the paragraphs of this letter makes it clear that the Dominion of India declared in clear and unambiguous terms that no grants made or orders issued by the Maharana before April 1, 1948 would be questioned by it. It may be mentioned that in the last paragraph of this letter it was stated that the contents of the letter would be regarded as part of the Merger Agreement entered into by the Maharana with the Governor General of India. It may be recalled that this letter was written months after the merger and after the citizens of the extinct State became the citizens of the absorbing State. The effect of the last paragraph of the said letter will be considered in due course. On July 8, 1949 the Government of Bombay sent a communication to the Commissioner, Northern Division, stating that the Government considered that the order passed by the ruler of Sant State on March 12, 1948 transferring forest rights to all the Jagirdars of the Jagir villages was mala fide and that it should be cancelled. It was suggested that the Commissioner should do some other preliminary acts before taking further action in the matter. It would be seen from this communication that the order was not actually cancelled, but there was some correspondence in respect of that matter and that it was not even communicated to the jagirdars. There was obstruction by the forest officers when the contractor was cutting the trees, but after some correspondence he was permitted to cut the trees, on an undertaking that he would abide by the decision of the Government. On February 6, 1963 the Government of Bombay passed a resolution after receiving a report from the Forest Settlement Officer specially appointed by it to investigate the rights of jagirdars. It was stated in the resolution )that the Tharav issued by the ruler of Sant State in 1948 was mala fide and, therefore, not binding on the Government. Thereafter, it scrutinized the claims of jagirdars to forests in 74 villages in the erstwhile Sant State and recognized their rights in some of the villages. So far as Gotimada village. is concerned, it was stated that the question of forest rights in the said village was still under the 520 consideration of the Government and necessary orders in that behalf would be issued in due course. It is clear that till 1953 the Government did not refuse to recognize the title of the Jagirdars to forests; indeed, in the case of Gotimada village no final order was made even on that date. On these facts, the question that arises is whether the respondent would be entitled to a permanent injunction issued by the High Court restraining the appellant from interfering with his right to cut trees in Gotimada village. The argument of the learned Attorney General, so far as it is relevant to the question which I propose to deal with, runs as follows : After the merger of the Sant State with the Dominion of India the jagirdar had nO title to the forests against the Dominion of India unless it recognized such a right, and that, as in the instant case the said Government did not recognize such a right, he or his assignees could not maintain any action against the State on the basis of his title to the said forests. He conceded that on the basis of the finding of the High Court that the Dominion of India did not repudiate the title of the jagirdar to the forests till after the Constitution came into force, the decision of this Court in Virendra Singh vs The State of Uttar Pradesh(1) is against him. But he, contended that it was not correctly decided and indeed its binding force was weakened by later decisions of this Court. As the correctness of the decision in Virendra Singh 's case(1) is questioned, it is necessary to consider the scope of that decision in some detail and also to ascertain whether later decisions of this Court had in any way weakened its authority. The facts in that case were as follows. The petitioners in that case were granted in January, 1948,Jagirs and Muafis by the Ruler of Sarila State in one village and by the Ruler of Charkhari State in three villages. In March, 1948, a Union of 35 States, including the States of Sarila and Charkhari. was formed into the United States of Vindhya Pradesh. The Vindhya Pradesh Government confirmed these grants in December, 1948, when its Revenue Officers interfered with them questioning their validity. The integration of the States however did not work well and the same 35 Rulers entered into an (1) ; 521 agreement in December 1949, and dissolve the newly created State as from January 1, 1950, each Ruler acceding to the Government of India all authority and jurisdiction in relation to the Government of that State. After the Constitution came into force, the Government of Uttar Pradesh in consultation with the Government of India revoked the grant of Jagirs and Muafis in four of the villages. On an application filed by the petitioners under article 32(2) of the Constitution, this Court issued a writ against the State. From the said facts it would be seen that the grants were made to the petitioners before the merger, and it was held that the Government had no right to revoke the said grants after the Constitution came into force. Bose J., speaking for the Court, elaborately considered the doctrine of "Act of State" in the light of English and American decisions and the opinions of jurists of International Law and came to the following conclusion : "We think it is clear on a review of these authorities that whichever view be taken, that of the Privy Council and the House of Lords, or that of Chief Justice Marshall, these petitioners, who were in de facto possession of the disputed lands, had rights in them which they could have enforced up to 26th January, 1950, in the Dominion Courts against Fill persons except possibly the Rulers who granted the land and except possibly the State. We do not by any means intend to suggest that they would not have enforced them against the Rulers and the Dominion of India as well, but for reasons which we shall presently disclose it is not necessary to enter into that particular controversy. It is enough for the purpose of this case to hold that the petitioners had. , at any rate, the rights defined above. " Pausing here it will be noticed that this Court did not express a final opinion on the question whether the petitioners could have enforced their title to the property against the Rulers before the Constitution came into force. but it had definitely held that the petitioners had title to the property against all 522 persons except the Rulers. On the basis of that finding, Bose J., proceeded to consider the impact of the Constitution on the said finding. The learned Judge observed: "But however that may be, there is no question of conquest or cession here. The new Republic was. born on 26th January, 1950, and all derived their rights of citizenship from the same source, and from the same moment of time; so also, at. the same instant and for the same reason, all territory within its boundaries became the territory of India. There is, as it were from the point of view of the new State, Unity of Possession, Unity of Interest, Unity of Title and Unity of Time." Then the learned Judge proceeded to state: "All the citizens of India, whether residing in States or Provinces, will enjoy the same fundamental rights and the same legal remedies to enforce them." This decision struck a new and refreshing note. It pleaded for a departure from imperialistic traditions and to adopt the American traditions, which are in consonance with the realities of the situation created by our Constitution. It gave new orientation to the doctrine of the act of State to reflect the modern liberal thought embodied in our Consti tution. It held that citizens of a ceding State have a title to their property against all except possibly the ruler. Though it inclined to go further and hold that the change of sovereignty does not affect the title of the citizens of the ceding State even against the new sovereign, it did not think fit to decide that question finally, as it found ample justification to sustain the title of the petitioners therein against the sovereign under our Constitution. It pointed out that the concept of ceding and absorbing States is foreign to our Constitution and that all the people of India, to whichever part of the country they might have belonged, through their representatives, framed the Constitution recognizing the fundamental rights of a citizen to hold property and not to be deprived of it save by authority of law. In that view it 523 held that the title of the petitioners in ,hat case to their Property was protected by the Constitution. This is a unanimous and considered decision of five learned Judges of this Court. I shall not obviously differ from this view unless there are compelling reasons to do so. I find none. I shall now proceed to consider whether the subsequent decisions of this Court threw any doubt on the correctness of the decision in regard to the following two aspects on which it had given a firm decision: (1) The citizen of a ceding State does not lose his title to immovable property but continues to have a right thereto against all except possibly the absorbing State; and (2) on the making of the Constitution, his title thereto became indefeasible even against the absorbing State. Where a company entered into an agreement, with the erstwhile State of Jind whereunder it had to pay income tax only at concessional rates, it was held in Mills. Dalmia Dadri Cement Co. Ltd. vs The Commissioner of Income tax(1) that, after the said State merged with the Union of India, the latter was not bound by the contractual obligations of the ceding State on the basis of the principle that the treaty between the two sovereigns was an act of State and the clauses of that treaty were not enforceable. In Jagannath Agarwala vs State of Orissa (2) it was held that after Mayurbhanj State had merged with the Province of Orissa the two money claims of the appellant against the Maharaja of Mayurbhanj State were not enforceable against the Orissa State on the ground that the Act of State did not come to an end till the claims made by the appellant were rejected and, therefore, municipal courts had no jurisdiction in the matter. Where the petitioners held Khor Posh grants from the Rulers of Talcher, Bamra and Kalahandi under the respective State laws it was held in Promod Chandra Deb vs The State of Orissa(3) that the laws continued to have legal force after the merger of the said States with the Union of India. Where the Nawab of Junagadh State made grants of property before he fled the State, it was held in (1) (2) ; (3) [1962] Supp. (1) S.C.R. 405. 524 State of Saurashtra vs Jamadar Mohamad Abdullah(1) that the cancellation of the said grants by the Regional Commissioner, who assumed charge of the administration of the State before the said State was integrated with the United States of Saurashtra, was an act of State. The question now raised did not arise for consideration in those cases. This Court accepted the English doctrine of Act of State and acted on the principle that till the right of an erstwhile citizen of a ceding State was recognized by the absorbing State, he has no enforceable right against the State. The scope and extent of the title to immovable property of a citizen of a ceding State was not examined in those decisions. Nor the impact of the Constitution on such rights was considered therein. In M/s. Dalimia Dadri Cement Co. Ltd. vs The Commissioner of Income tax(1) the following observations are found at D. 741, which may have some bearing on the first aspect of the question: "It is also well established that in the new set up these residents do not carry with them the rights which they possessed as subjects of the ex sovereign, and that as subjects of the new sovereign, they have only such rights as are granted or recognized by him." This observation is couched in wide terms. But this Court was not concerned in that case with the distinction between pre existing title of a citizen of a ceding State to his property against all and that against the State. Indeed, Bose J., in his dissenting judgment, made it clear that they were only concerned in that case with the contractual obligation of the erstwhile sovereign and that they were not dealing with the question of the title of the citizens to immovable property. That the judgment had also nothing to do with the second aspect was made clear by the following observations of Venkatarama Aiyar J., who expressed the majority view, at p. 749: "This argument assumes that there were in existence at the date when the Constitution came into (1) (2) 525 force, some rights in the petitioner which are capable of being protected by article 19(1)(f). But in the view which we have taken that the concessions under cl. (23) of exhibit A came to an end when Ordinance No. 1 of section 2005 was promulgated, the petitioner had no rights sub sisting on the date of the Constitution and therefore there was nothing on which the guarantees enacted in article 19(1) (f) could operate. " These observations indicate that this Court did not go back on the decision in Virendra Singh 's case(1) indeed, it re jected the argument based on that decision on the ground that the appellant lost his rights if any, under a pre Constitutional valid Ordinance. In State of Saurashtra vs Jamadar Mohamad Abdulla(2), Mudholkar J., speaking for himself and for Sarkar J., expressed the view on the question of impact of section 299(1) of the Constitution Act of 1935 on the title to immovable property of a citizen of a ceding State thus, at p. 1001: ". before the respondents could claim the benefit of section 299(1) of the Constitution Act, 1935, they had to establish that on November 9, 1947, or thereafter they possessed legally enforceable rights with respect to the properties in question as against the Dominion of India. They could establish this only by showing that their pre existing rights, such as they were recognized by the Dominion of India. If they could not establish this fact, then it must be held that they did not possess any legally enforceable rights against the Dominion of India, and, therefore, section 299(1) of the Constitution Act, 1935, avails them nothing. As already stated section 299(1) did not enlarge anyone 's right to property but only protected the one which a person already had. Any right to property which in its very nature is not legally enforceable was clearly incapable of being protected by that section." (1) ; , 433, 4. (2) (1962] 3 S.C.R. 970. 526 The same view was restated by the learned Judge in Promod Chandra Deb vs The State of Orissa(1). It may be stated that the said question did not arise for consideration in either of those two decisions, for in the former the cancel lation of the order issued by the Ruler of the ceding State was made before the merger and in the latter, the Court held that the laws whereunder the grants were made continued to have legal force after the merger of the concerned States with the Dominion of India. It may be pointed out that Das J., in the earlier decision and Sinha C.J., in the later decision, who delivered the leading judgments in those cases, had specifically left open that question. It may, therefore, be stated without contradiction that in none of the decisions of this Court that were given subsequent to Virendra Singh 's case(2) the correctness of that decision was doubted. Indeed, in the latest two decisions, the principle was sought to be extended to a situation arising under the Government of India Act. but the majority of the learned Judges left open the question, though two of the learned Judges constituting the Bench expressed their view against such an extension. On the findings, I have accept ed, the said question does not arise for consideration in this case and I do not propose to express my opinion thereon. If that be the position. is there any justification for this Court to refuse to follow the decision in Virendra Singh 's case(1). In my View, the said decision is not only correct, but is also in accord with the progressive trend of modern international law. After all, an act of State is an arbitrary act not based on law, but on the modern version of "might is right". It is an act outside the law. In the primitive society when a tribe conquered another tribe, the properties of the vanquished were at the mercy of the conqueror. The successful army used to pillage, plunder and commit acts of arson and rape. When society progressed, the doctrine of Act of State was evolved. which really was a civilized version of the primitive acts of pillage and plunder of the properties of the conquered tribe. But the further progress of civilization brought about by custom and agreement factual recognition of pre existing rights of the people of the conquered State. There were two different lines of (1) [1962] Supp. 1 S.C.R. 405. (2) ; 527 approach one adopted by imperialistic nations and the other by others who were not. That divergence was reflected in English and American Courts. All the jurists of internatio nal law recognise the continuity of title to immovable property of the erstwhile citizens of ceding State after the sovereignty changed over to the absorbing State. In A Manual of International Law by Georg Schwargenberger, 4th Edn., Vol. 1, at p. 81 the learned author says: "Private rights acquired under the law of the ceding State are not automatically affected by the cession. They must be respected by the cessionary State. " A more emphatic statement is found in The Law of State Succession by O 'Connell. Under the heading "The Doctrine of Acquired Rights" the learned author points out, at pp. 78 79: ". . only sovereignty and its incidents expired with the personality of a State. The relationships of the inhabitants one to another, and their rights of property were recognized to remain undisturbed. " He observes at p. 104: The doctrine of acquired rights is perhaps one of the few principles firmly established in the law of State succession, and the one which admits of least dispute." In Hyde 's International Law, second revised edition, Vol. 1, at p. 433, the following extract from the Sixth Advisory Opinion of September 10, 1923 of the Court of International Justice is quoted: "Private rights acquired under existing law do not cease on a change of sovereignty. No one denies that the German Civil Law, both subs tantive and adjective, has continued without interruption to operate in the territory in question. It can hardly be maintained that, although the law survives, private rights acquired under it have perished. Such a contention is based on no principle and would be contrary to an almost universal opinion and practice. " 528 In Oppenheim 's International Law, 8th edition, Vol. 1 the same legal position is re stated at p. 571 thus: "It must be specially mentioned that, as far as the law of Nations is concerned, the subjugating State does not acquire the private property of the inhabitants of the annexed territory. Being now their sovereign, it may indeed impose any burdens it pleases on its new subjects it may even confiscate their private property, since a sovereign State can do what it likes with its subjects; but subjugation itself does not by International Law affect private property. " Starke in his book, An Introduction to International Law, 5th edn., observes, at p. 274: "Such of these rights as have crystallised into vested or acquired rights must be respected by the successor State, more especially where the former municipal law of the predecessor State has continued to operate, as though to guarantee the sanctity of the rights. " Much to the same effect the relevant statement of inter national law is found in Briggs ' The Law of Nations, 2nd edn. It may, therefore, be held that so far as title to im movable property is concerned the doctrine of international law has become crystallised and thereunder the change of sovereignty does not affect the title of the erstwhile citizens of the ceding State to their property. In America the said principle of International Law has been accepted without any qualification. Chief Justice John Marshall of the United States Supreme Court has succinctly stated the American legal position in United States vs Percheman (1) thus: "The people change their allegiance; their relation to their ancient sovereign is dissolved; but their relations to each other, and their rights of property, remain undisturbed. If this be (1) ; at 86, 87. 529 the modern rule even in cases of conquest, who can doubt its application to the case of an amicable cession of territory?. . A cession of territory is never understood to be a cession of the property belonging to its inhabitants. The King cedes that only which belonged to him. Lands he had previously granted were not his to cede. Neither party could so understand the cession. Neither party could consider itself as attempting a wrong to individuals, condemned by the practice of the whole civilised world. The cession of a territory by its name from one sovereign to another. conveying the compound idea of surrendering, at the same time the lands and the people who inhabit them, would be necessarily understood to pass the sove reignty only, and not to interfere with private property. " This principle has been accepted and followed by the American Courts in other decisions. But it is said that the view of the American Courts is really based upon the circumstance that international treaties are part of the supreme law of the land. Article VI of the Constitution of the United States declares that all treaties made, or which shall be made, under the authority of the United States, shall be the supreme law of the land; and the Judges in every State shall be bound thereby, anything in the Constitution or laws of any State to the contrary notwithstanding. Chief Justice Marshall in Foster vs Neilson(1) said: "Our Constitution declares a treaty to be the law of the land. It is, consequently, to be regarded in courts of justice as equivalent to an act of the legislature, whenever it operates of itself without the aid of any legislative provision." A treaty in America may be deemed to be a law of the land; but the American view is not solely based on treaties. (1) ; 134 159 S.C. 34. 530 In The American Insurance Co. and the Ocean Insurance Co. vs Bales of Cotton(1), Chief Justice Marshall clearly recorded the view of the American Courts thus: "On such transfer of territory, it has never been held that the relations of the inhabitants with each other undergo any change. " Again the learned Chief Justice in Charles Dehault vs The United States(2) expressly pointed out the existence of the said rights apart from any treaty. He observed: "Independent of treaty stipulations, this right would be held sacred. The sovereign who acquires an inhabited territory acquires full dominion over it; but this dominion is never supposed to divest the vested rights of individuals to property." Therefore, the distinction sought to be made may perhaps have some relevance, if in a particular treaty there. is a specific term that the United States shall recognize the acquired rights of a citizen of a ceding State, but none if the treaty does not contain such a covenant. The American decisions, therefore, cannot be distinguished on this narrow ground; they have recognized the doctrine of International Law and inter woven it in the texture of the American municipal law. The Courts in England have developed the doctrine of act of State which, in the words of Stephen, means "An act injurious to the person or property of some person who is not at the time of that act a subject of Her Majesty; which act is done by a representative of Her Majesty 's authority, and is either sanctioned or subsequently ratified by Her Majesty. " A treaty whereunder a sovereign territory is ceded is held to be an act of State, for it is not done under colour of any title but in exercise of a sovereign power. Has the law of England denied the doctrine of acquired rights so well settled in International Law? (1) (2) , 131. 531 In Vajesingji Joravarsingji vs Secretary of State for India in Council(1), the Judicial Committee summarized the law on the subject thus: "When a territory is acquired by a sovereign State for the first time that is an act of State. Any inhabitant of the territory can make good in the Municipal Courts established by the new sovereign only such rights as that sovereign has, through his officers, recognized. Such rights as he had under the rule of predecessors avail him nothing. Nay more, even if in a treaty of cession it is stipulated that certain inhabitants should enjoy certain rights, that does not give a title to those inhabitants to enforce these stipulations in the municipal Courts. The right to enforce remains only with the high contracting parties. . ". The sentence in the said passage, namely, "such rights as he had under the rule of predecessors avail him nothing", cannot be, in the context in which it appears, interpreted as a denial of the doctrine of acquired rights evolved by International ]Law, but it only refers to the question of enforceability of such an acquired right in a municipal court. The same view has been expressed in a number of English decision. Therefore, the law in England is that the municipal courts cannot enforce the acquired rights of the erstwhile citizens of the ceding State against the absorbing State unless the said State has recognized or acknowledged their title. This Court accepted the English. doctrine of act of State in a series of decisions noticed by me earlier. What does the word "recognize" signify? It means "to admit, to acknowledge, something existing before." By recognition the absorbing State does not create or confer a new title, but only confirms a pre existing one. It follows that till the title Is recognized by the absorbing State, it is not binding on that State. An exhaustive exposition of this branch of law is found in Promad Chandra Dab 's case(2). I am bound by that decision. O 'Connell in The Law of State Succession (1) 51 I.A. 357. (2) [1962] Supp. (1) S.C.R. 405. 532 brings out the impact of the doctrine of act of State on that of acquired rights under International Law, at p. 88, thus: "The doctrine of act of State is one of English municipal law. It merely denies an English Court jurisdiction to inquire into the consequences of Acts of the British Government which are inseparable from the extension of its sovereignty. The court is not entitled to ask if such acts are 'just or unjust, politic or impolitic ' or what legal rights and duties have been carried over in the change of sovereignty. The doctrine is not intended, however, to deny a rule of International Law. " In the words of the same author, the fact that a right can not be enforced does not mean that it does not exist. Non recognition by the absorbing State does not divest title, but only makes it unenforceable against the State in municipal courts. The result of the discussion may be summarized thus: the doctrine of acquired rights, at any rate in regard to immovable property, has become crystallized in International Law. Under the said law the title of a citizen of a ceding State is preserved and not lost by cession. The change of sovereignty does not affect his title. The municipal law of different countries vary in the matter of its enforceability against the State. As the title exists. it must be held that even in those countries, which accepted the doctrine of act of State and the right of a sovereign to repudiate the title, the title is good against all except the State. Before the Constitution came into force the State did not repudiate the title. When the Constitution of India came into force the respondent and persons similarly situated who had title to immovable property in the Sant State had a title to the said property and were in actual possession thereof. They had title to the property except against the State and they had, at any rate, possessory title therein. The Constitution in article 31(1) declares that no person shall be deprived of his property save by authority of law. That is, the Constitution recognized the title of the citizens of the erstwhile State of Sant, and issued an injunction against the 533 soveriegn created by it not to interfere with that right except in accordance with law. A recognition by the supreme law of the land must be in a higher position than that of an executive authority of a conquering State. I would, therefore, hold that the title to immovable property of the respondent was recognized by the Constitution itself and therefore, necessarily by the sovereign which is bound by it. 1, therefore, respectfully hold that Virendra Singh 's case(1) has been correctly decided. Apart from the recognition of the title of the respondent by the Constitution, in this case the letter written by the Government of India, dated October 1, 1948, clearly recognized the title of persons situated in the position of the respondent to their properties. But the learned AttorneyGeneral contends that the letter shall be regarded as part of the merger agreement and therefore its terms cannot be relied upon for the purpose of recognition of the respondent 's title or of evidence of the Govemment 's waiver of its right to repudiate the respondent 's title. It is true that in the concluding portion of the letter it is stated that the contents of the letter will be regarded as part of the merger agreement. But the merger had already taken place on June 10. 1948 and this letter was written on October 1, 1948. It does not appear from that letter that the Maharana of Sant State, who ceased to be the Ruler except in name for certain privileges, was a party to it. This letter, therefore, can at best be treated as one of the acts of the Government of India implementing the terms of the merger agreement. It cannot, therefore, be said to be a part of the merger agreement. If it was not, by calling it so it did not become one. At the time the letter was sent all the citizens of the erstwhile Sant State had become the citizens of India. The letter contains a clear statement in paragraphs 5 and 7 thereof that enjoyment of ownership of jagirs, grant etc. existing on April 1, 1948 were guaranteed and that any order passed or action taken by the Ruler before the said date would not be questioned. This is a clear recognition of the property rights of the respondent and similar others. It is necessary, therefore, to express my opinion on the ques (1) ; 534 tion whether, even if the said letter formed part of the merger agreement, any recital therein can be relied upon as evidence of recognition of pre existing titles by the absorbing State or waiver of its sovereign right to repudiate the said titles. For the aforesaid reasons I agree that the appeal should be dismissed with costs. For the same reasons Civil Appeals No. 183 to 186 of 1963 are also dismissed with costs. HIDAYATULLAH J. These appeals by the State of Gujarat impugn a common judgment of the High Court of Gujarat dated January 24, 1961. The respondents were plaintiffs in five suits for declaration of rights in forests and for permanent injunction against interference with those rights by the State. All suits except one were dismissed by the Court of first instance. The District Judge on appeal ordered the dismissal of that suit also and dismissed the appeals of the plaintiffs in the other suits. The plaintiffs then appealed to the High Court and by the judgment under appeal, all appeals were allowed and the suits were decreed. The State Government has now appealed to this court by special leave. The forests in respect of which the declaration and injunction were sought are situated in the former State of Santrampur (also called Sant State). Santrampur Was an Indian State and the Ruler attained independence and sovereignty on August 15, 1947 on the ceasing of the para mountcy of the British Crown. The Ruler at first ceded his sovereignty on three subjects to the Government. of India but on March 19, 1948, ceded the territory of the State to the Government of India by an agreement which came into force from June 10, 1948. The Central Government, by virtue of powers vested in it by the Extra Provincial Jurisdiction Act, 1947, delegated its functions to the Provincial Government of Bombay and on June 2, 1948, the Administration of the Indian States Order was passed and it was applied to Sant State from June 10, 1948. On July 28, 1948, the Indian States (Application of Laws) Order, 1948 535 was passed. Certain enactments in force in the Province of Bombay were extended to Sant State and then under the States ' Merger (Governor 's Provinces) Order, 1949, Sant State became a part of the Province of Bombay from August 1, 1949. On October 1, 1948, a letter of guarantee was written to the Ruler by Mr. V. P. Menon in which it was stated. as follows: ". . 7. No order passed or action taken by you before the date of making over the administration to the Dominion Government will be questioned unless the order was passed or action taken after the 1st day of April, 1948, and it is considered by the Government of India to be palpably unjust or unreasonable. The decision of the Government of India in this respect will be final. " It was Added that the letter would be read as part of the original Merger agreement. A week before ceding the territories of his State, the Ruler of Sant made a Tharao or Thavan order as follows: "Order 3. Outward Register No. 371. The Jivak, Patayat, Inami, Chakariyat, Dharmada villages in Sant State are being given (granted) to Jagirdars and the holders of the said villages are not given rights over forests. Hence after considering the complaints of certain Jagirs, they are being given full rights and authority over the forests in the villages under their vahivat. they should manage the vahivat of the forest according to the policy and ad ministration of the State. Orders in this regard to be issued. In English. Maharana, Sant State. " 536 The former grants which were made in favour of the jagirdars and holders of the villages have not been produced, but they were probably like the grant of village Gothimada dated December 1, 1857, which was to the following effect: ". . You have to do the vahivat (management) of the land situate within the permanent boundaries of the outskirts of the villages in four directions. This village has been granted for the appropriation and enjoyment of the income thereto except in respect of civil and criminal matters. So you must behave in the State in accordance with the custom and usage and practice of other Thakarati villages of the State. If any person of the village is ordered in regard to any work or matter then you should not in any way interfere therein but produce the said person as per order. You have to act and behave according to the said clauses and should remain with integrity and honesty and loyal to the State. Dated: 1 12.1867 A.D.S.Y. 1929 Magsar. Sudu 5. " After the Tharao was issued on March 12, 1948, some of the Thakores executed contracts in favour of the plaintiffs between May 1948 and 1950. The agreements which were made with the contractors are on the file of the appeals. The Thakores and the contractors then began to take forest produce but they were stopped in April 1949. The present five suits were then filed. Four of the suits were instituted by the contractors and the fifth by one of the Thakores in the capacity as inamdar. After merger, a question arose whether these contracts should be approved or not. On January 1949, on the application of one of the Thakores, an order was passed by the Divisional Forests Officer. It was as follows: 537 .lm15 "Gothimada village of santrampur State. Application of the owner requesting to grant authorization to the Contractor and states that he has no objection if the authorization is issued. Is the authorization up to Lunawada and Signally only, time limit up to 31 3 1949. No export outside to be permitted, pending receipt of orders from Government. Written undertaking to be taken from the purchaser that he will abide by the decision and orders passed by Government and then the authorization handed over. Send copy to F.O. Lunawada." Similar orders were passed in respect of other villages and undertakings were taken from the Thakores and the con tractors. A sample is quoted here "UNDERTAKING: I, Thakore Sardarsingh Gajesingh hereby give an undertaking to abide by the decision and or ers passed by the Government of Bombay in respect of Gothimada forests, rights over which were conferred on me by Santrampur State Government on 12 3 48 in their resolution No. G. 371 dated 12 3 48. Authorization Nos. 111, 112 of 1948 49, in respect of village in Santrampur State issued by the Divisional Forest Officer, Integrated States Division, Devgad Baria in favour of Mr. Hatimbhai Badruddin is subject to the above undertaking. Dated 1 2 49. in Gujarathi. " The Conservator of Forests, North Western Circle also issued a memorandum on January 18, 1949 stating: ". . However, to safeguard the Government interest written undertaking should be taken from the jahagirdars, Inamdars of person or persons. concerned that he or they would abide by the decision or orders passed by the Bombay Gov ernment in respect of such private forests, when the question of rights over such private forests is finally settled. " When the undertakings were furnished, passes were issued to the contractors. In April 1949, however, the work of all the contractors was stopped and on July 8, 1949, Government sent a communique to the Collector of Panch Mahals repudiating the Tharao of March 12, 1948. In this letter it was stated as follows: "Reference your memorandum No. ADM(P) 50 A11, dated 24th May, 1949, Government considers that the order passed by the Ruler of the Sant State under his No. 371, dated 12th March, 1948 transferring forest rights to all the jagirdars of the jagir village, are mala fide and that they should be cancelled. Before, however, taking further action in the matter, please ascertain whether the possession of the forests in question is with Government or has gone to the Jagirdars. If the possession is still with Government please ask the Officer of the Forest Department to retain the same and to refuse to issue passes, etc. to private contractors and purchasers. By order of the Governor of Bombay. Sd/ ". It appears that this was not communicated to the contractors of the Thakores. On June 29, 1951, the Government of Bombay passed a resolution that the Maharana 's order would not be given effect to. Another resolution was passed on February 6, 1953 as follows: "On the eve of the merger of the Sant State in the State of Bombay, the Ruler of that State issued Tharav No. 371 on 12th March, 1948, under which Jiwai, Patawat, Inami, Chakriat and Dhannada Jagirdars and inamdars were given full forest rights over the villages in their charge. The Government 539 of Bombay, after considering the implication of the Tharav, decided that the order was mala fide and cancelled it on 8th July, 1949 vide Government Letter, Revenue Department No. 2103 M 49 dated the 8th July, 1949. By the time these orders were issued, the tree growth in the Jagiri forests concerned was already sold by some of the Jagirdars and the trees cut. Further cutting of trees and export of trees cut was however stopped by the Forest Department after receipt of the orders of 8th July, 1949. On representation being made to Government, however, agreed to allow to release the material felled from the forest under dispute, pending decision on the settlement of forest rights, subject to the condition that the contractor furnished two sureties solvent for the material removed or deposited with the Divisional Forest Officer certain amount per wagon load of material. The owner of the material was also asked to give a written undertaking that he would abide by the ultimate decision of Government. . . . 5. Government is, however, pleased to examine individual cases of Jagirdars and inamdars irrespective of the Tharav of 1948, on the basis of the Forest Settlement Officer 's Report and other considerations. The question of forest rights in the following villages is still under consideration of Government and necessary orders in that behalf will be issued in due course: (1) Nanirath. (2) Gothimada. (3) Rathada. . . . " Before this the suits we are dealing with were filed. The contention of the plaintiffs was that the Merger agreement of March 1948 was not an Act of State, because it was preceded by surrender by the Ruler of sovereignty in respect of three subjects. This contention was not accepted in the High Court and has not been raised here. The next conten tion was that the Tharao or order of March 12, 1948 was a 540 legislative act and as all the old laws of the State were to continue to be in force except as modified by the Indian States (Application of Laws) Order, 1948, the Tharao could be revoked by the appellant by Legislative authority only and not by an executive act. The High Court did not accept this contention, because according to the High Court, the Tharao was not a piece of legislation, but was a rant by the Ruler. The third contention was that the Central Government through Mr. V. P. Menon has undertaken not to question any order or action taken before 1st April, 1948, and that this created a bar to the repudiation of the order of the Maharana dated March 12, 1948. This contention was not accepted by the High Court. The High Court held that the letter formed a part of an Agreement which could only be enforced by the High Contracting Parties, if at all, but not by any other person, and in any event, municipal courts had no authority to enforce the agreement. The High Court relied upon article 363 of the Constitution and the decisions of this Court. The High Court, however, accepted the contention of the plaintiffs, that it was open to the succeeding sovereign to waive or relinquish its right to repudiate the actions of the previous Ruler and to acknowledge either expressly or impliedly the rights conferred on the subjects of the previous Ruler and that this had been done in this case. They referred to the permission which had been given by the officers of the Forest Department to the plaintiffs in this suit to cut and carry away the timber and regarded the letter of Mr. V. P. Menon as evidence of waiver and relinquishment. They held on the authority of Virendra Singh and Others vs The State of Uttar Pradesh(1) and Bholanath J. Thakar vs State of Saurashtra (2) and the judgment of the Bombay High Court in Bhoirajji vs Saurashtra State(3) that the Government must, in these circumstances, be held to have waived or relinquished its rights to enforce the Act of State against the plaintiffs. On behalf of the appellant, it is urged (a) that the Act of State continued till the resolutions were passed and there (1) ; (2) A.I.R. (1954) S.C. 680 (3) 541 was no waiver or relinquishment in favour of the appellants, and (b) that the action of the subordinate officers of the Forest Department did not bind Government and the res pondents cannot take advantage of the letter of Mr. V. P. Menon. On behalf of the respondents, in addition to meeting the above arguments, it is contended that the Tharao was a law and could only be revoked by another law. It is further argued that after the Merger, section 299(1) of the Government of India Act, 1935 which read "No person shall be deprived of his property in British India save by authority of law" protected the respondents and this protection became absolute on January 26, 1950, by reason of article 31 of the Constitution. As the resolutions in question were passed after the commencement of the Constitution, it is urged that they cannot affect the rights of the respondents who came under the protection of article 31 of the Constitution. It is contended that in any case, the Act of State could not operate against the citizens of the State which the res pondents became on the Merger or on the inauguration of the Constitution. It is also argued on behalf of the res pondents on the authority of a case of the Permanent Court of International Justice and certain cases of the Supreme Court of the United States that the Act of State should not interfere with rights in property held from a former Ruler. The appellant contends in reply that the Act of State continued, because the contractors, and jagirdars were permitted to work the forests on their furnishing under takings, and it was only completed against them in April, 1949, when they were asked to stop their work even though the actual order of Government deciding whether to accept the Tharao or not was communicated to them in 1953. It is argued that what was of real consequence was not the decision of the Government but the stoppage of the work. It is also argued that section 299(1) did not protect the respon dents against the Act of State and that as there was no State succession on January 26, 1950, the original Act of State did not come to an end. It is also pointed out that this Court has not accepted the rule of International Law referred to in Virendra Singh 's case(1) and has instead acted on (1) ; 542 the doctrine of Act of State as interpreted by the Courts in England. I shall deal with these points in brief, because most of them have been decided against the respondents in the High Court on the basis of earlier rulings of this Court. To begin with, this Court has interpreted the integration of Indian States with the Dominion of India as an Act of State and has applied the law relating to an Act of State as laid down by the Privy Council in a long series of cases beginning with Secretary of State in Council for India vs Kamachee Boye Saheba(1) and ending with Secretary of State vs Sardar Rustam Khan and Other(2). The cases on this point need not be cited. Reference may be made to M/s. Dalmia Dadri Cement Co. Ltd. vs Commissioner of Income tax(3), The State of Saurashtra vs Menon Haji Ismali Haji(4), jaganath Agarwala vs State of Orissa(4) and State of Saurashtra vs Jamadar Mohamed Abdulla and Others(5). In these cases of this Court, it has been laid down that the essence of an Act of State is an arbitrary exercise of sovereign power on principles which are paramount to the Municipal Law, against an alien and the exercise of the power is neither intended nor purports to be legally founded. A defence that the injury is by an Act of State does not seek justification for the Act by reference to any law, but questions the jurisdiction of the court to decide upon the legality or justice of the action. The Act of State comes to an end only when the new sovereign recognises either expressly or impliedly the rights of the aliens. It does not come to an end by any action of subordinate officers who have no authority to bind the new sovereign. Till recognition, either express or implied, is granted by the new sovereign, the Act of State continues. If we apply these tests (rightly applied in the High Court), we reach the result that the Government of Bombay and the Central Government could refuse to recognise the rights created on the eve of the Merger by the Tharao of the Maharana and to say that it was not acceptable to them and therefore not binding on them. Such action may be (1) ; (3) [1959] S.C.R. 729 (5) ; (2) (1941) 68 I.A. 109. (4) (1960] 1 S.C.R. 537. (6) 543 harsh or unfair; but the Municipal Courts cannot declare it to be so, because unless the rights are irrevocably recog nised earlier the Municipal Courts have no jurisdiction to pronounce upon the legality or the justness of the action. It is for this reason that the respondents pleaded in the High Court that there was a waiver or relinquishment of the Act of State in their favour. Relinquishment and waiver were again relied upon by the respondents before us and they refer to two circumstances from which an inference about waiver or relinquishment can be raised. The first is cl. 7 of the letter of Mr. V. P. Menon quoted above and the second is the conduct of the officers of the Forest Department in allowing the contractors and the jagirdars to work the forests in accordance with the Tharao of the Maharana. Cl. 7 of a similar letter of guarantee was considered by this Court in Maharaj Umeg Singh and Others vs The State of Bombay and Others(1). In that case also arguments were the same as here. It was then contended that the Ruler 's agreement with the Government ensured for the benefit of the subjects even if they were not parties to the agreement. It was then pointed out on behalf of the Government that the agreement, if any, could not be sought to be enforced by persons who were not parties to it. This Court observed: "We do not feel called upon to pronounce upon the validity or otherwise of these contentions also for the simple reason that the petitioners would be out of Court either way. If they were deemed to be parties to the agreements of merger and letters of guarantee they would be faced with the bar to the maintainability of the petitions under Article 363 of the Constitution which lays down that neither the Supreme Court nor any other Court shall have jurisdiction in any dispute arising out of any provision of a treaty, agreement, covenant, engagement, sanad or other similar instrument which was entered into or executed before the commencement of the Constitution by any Ruler of an Indian State and to which the Government of (1) ; 544 the Dominion of India. was a party. If on the other hand they were deemed not to have been parties to the same they would not be the contracting parties and would certainly not be able to enforce these obligations. " It would, therefore, appear that the present respondents who were not parties to the Merger agreement or to the letter written by Mr. Menon which was made expressly a part of the Agreement cannot take advantage of cl. 7. If they were parties, article 363 would bar such a plea. It is next contended that the Act of State had come to an end after the Government of India Act, 1935 was applied to the State and the State became a part of the territories of the Government of India. This argument was raised to claim the benefit of section 299 (1) of the Government of India Act 1935. The interference with the rights in forests conferred by the Tharao and the agreements with the contractors based on the Tharao took, place in April, 1949. It was contended that on June 10, 1948, the subjects of Sant State became Indian citizens and they were protected by section 299(1). The Officers of the Forest Department did not unconditionally allow the forests to be worked. They made it clear to the contractors and the jagirdars that what they were doing was not final and that Government was going to decide about the Tharao and the contracts later. No doubt, the forests were allowed to be worked, but an undertaking was obtained from each contractor and jagirdar. This showed that the officers of the Forest Department did not attempt to bind the Government, even if they could. It is true that the order of Government to stop work was not communicated to the contractors and the jagirdars but the working of the forests was as a matter of fact stooped much earlier and the learned Attorney General is right in pointing out that it was all that mattered. This action of the officers was later approved by Government when it decided that it would not allow any rights to flow from the Tharao and the contracts. In other words, while Government was considering the matter, the officers of the Forest Department tentatively allowed the forests to be worked but in no manner to bring the Act of State to art end. The Act 545 of State could only come to an end if Government recognised the rights flowing from the Tharao. That, Government never did. There was thus no recognition of the Tharao or the rights flowing from it at any time. It was pointed out by this Court in Aggarwala 's case(1) that Government may take time to consider and delay does not militate against the Act of State. In that case also the decision of Government was taken after the coming into force of the Constitution. This Court pointed out, agreeing with Vaje Singhji jorawar Singh vs Secretary of State for India(2) that enquiries may continue for some time without any inference of waiver or relinquishment. No doubt, in Bholanath Thaker 's case(3) and in Virendra Singh 's case(4) waiver or relinquishment was inferred from the conduct of Government. Such an inference may legitimately be raised where Government, after having accepted the rights, attempts to go back upon such acceptance. There must, however, be a clear indication, either expressly or by implication, that Government has, in fact, accepted the rights. In the present case, the subordinate officers of the Forest Department allowed the forests to be worked, making it quite clear that Government was considering the matter and took undertakings from the respondents that they would abide by the decision of Government. Government passed an order declining to accept the Tharao. The order so passed was not communicated to the respondents but later it was reiterated as a resolution which was communicated. To avoid this result, there are two arguments upon which the respondents rely and they are the main contentions in these appeals. The respondents seek support for the judgment by challenging the decision on some of the points decided against them. The first is that the Tharao was a law which could only be rescinded by another law. In this connection, the respondents rely upon the observations made by this Court in Madhaorao Phalke vs The State of Madhya Bharat(5). These observations were based upon (1) ; (2) (1924) L. R. 51 I. A. 357. (3) A I.R. (4) ; (5) ; 964. 134 159 SC 35. 546 the earlier case in Ameer un nissa Begum and Others vs Mehboob Begum and Others(1). In these cases, it was pointed out that the distinction between legislative, executive and judicial acts of an absolute Ruler (such as the Indian Rulers were) was apt to disappear when the source of authority was the sovereign. These observations are sought to be applied here. In the past also these observations were invoked on occasion. In so far as the subjects of the Ruler were concerned, they were bound to obey not only laws but any orders of the Ruler, whether executive or judicial. For them they did not exist any difference because each emanation of the will of the sovereign required equal obedience from them. But it does not mean that the Ruler acted legislatively all the time and never judicially or executively. If this was the meaning of the observations of this Court, then in Phalke 's case(2) it would not have been necessary to insist that in determining whether there was a law which bound the succeeding sovereign, the character. content and purpose of the declared will must be independently considered. In Ameer un nissa 's case,(3) this Court was concerned. With a Firman of the Nizam and that was one of the accepted modes of making laws in Hyderabad State. In Phake 's case(2), this Court was concerned with Kalambandis which were held by this Court to be laws binding upon the subsequent Government unless repealed or replaced by other law. The Kalambandis were so regarded partly because the Maharana had himself laid down that Kalambandis issued by him were to be regarded as law, and partly because the Kalambandis created a tenure which carried with it pensions. The pensions were grants but the manner of enjoyment of the pensions was determined by the rules of tenure provided in the Kalambandis also bearing upon succession and devolution. These cases were distinguished in more recent cases when the observations were sought to be extended to others which were clearly not legislative and reference may be made to Maharaj shree Umaid Mills Ltd. vs Union of India and Others(3) and The Bengal Nagpur Cotton Ltd. vs The Board of Revenue, Madhya Pradesh and Others(4). It was pointed (1) A.T.R. (2) ; , 964. (3) A.T.R. (4) ; 547 out in these two cases that the observations in Ameer un nissa 's case(1) Phalke 's case(2) could not be read as indicating that everything that the Maharaja said or ordered was a law. In the latter case, this Court pointed out that a proper law would be one which was made in accordance with the traditional mode of making laws in the territory or in accordance with some procedure which was expressly devised for tile occasion. It was pointed out that law is the result of a legislative process and the result must be intended to bind as a rule of conduct; it must not for example be a contract or a grant or a gift etc. Viewed from this angle, it is quite obvious that the Tharao was not a law. It was a grant made to the jagirdars mentioned in the Tharao. It is contended that it is made applicable to persons belonging to five different tenures and that the 'management ' of the forests was to be done according to the policy and administration of the State. No doubt, the Tharao is applicable to a large number of persons enjoying different tenures but it is stated therein that orders were to be issued individually to all of them. The Tharao was issued only 8 days before the Merger. It is surprising that the Maharaja thought of the complaints of the grantees on the eve of the Merger. The fact that the Maharana 's Tharao was passed to benefit a large number of persons en bloc does not make it any the more a law if it did not possess any of the indicate of a law. The respondents would not admit that if it had been addressed to individuals, it would have changed its character from a law to a grant. This fact makes no difference to its character. content and purpose. Further, the original grant of which the Tharao became a part was also a grant. One such grant has been quoted above. The word "Vahivat" does show that the grant was for management but in this context, it means more than management. It was customary to use this word in conferring rights which were liable to be resumed. These grants did give rights to the grantees but did not lay down any rule of conduct. It may be pointed out that in Umeg Singh 's case(3) it was contended that cl. 5 of the letter of (1) A.I.R. 1955 S.C. 352. (2) ; , (3) [1955] 2 S.C.R.164. 548 Mr. Menon prevented legislation and it was then held that the grants were not legislative measures of the Maharaja and did not bar the making of laws to set the grant at naught. In that case also there was a Tharao in dispute. The Tharao cannot, therefore, be treated as a law at all. It is a grant and as a grant it was open to the new sovereign not to recognise it. It was contended that in any event, after the commencement of the Government of India Act, 1935, the respondents had the protection of section 299(1). This point was raised but was left open by the majority in Jamadar 's case(1) to which we have already referred. On that occasion, Sarkar and Mudholkar JJ. in a separate judgment held that section 299(1) did not afford any protection. The learned Judges pointed out that section 299(1) did not add to the rights of persons but protected such rights as existed. If on the Merger of the territories of the Indian Rulers with those of the Government of India. there was Act of State and if as held by this Court in the cases to which reference has alreadY been made it was open to the Government of India to decide whether or not to recognise certain rights, the Government of India could do so. In that event, section 299(1) did not come into play because it could only come into play after the rights were recognised. The Act of State continued because Government was taking time to consider whether to accept the Tharao or not and while the decision was being reached, there was a second change inasmuch as the present Constitution was passed. It is contended that there was a lapse of the original Act of State because of a State succession on January 26, 1950, and as this was before the Resolutions of 1951 and 1953, the respondents were protected. The first question to consider is whether there took place in 1950 a State succession. State succession takes place either in law or in fact. It takes place in law when there is a juridical substitution of one State for another. It take place in fact when there is (a) annexation (2) or (b) cession(2) (1) (2) e.g. Algiers by France (1831) or South African Republic by Great Britain (1901). (3) e.g. the Ionian Islands by Britain to Greece (1864) or territory to Poland by Germany. 549 or (c) fusion of one State with another into a federal Union (2) or (e) partition ration of secession(3). It will be seen that on the 26th January, 1950, there was no succession in fact because none of these events took place. As Oppenheim defined "succession" "A succession of International Persons occurs when one or more International Persons take the place of another International Person in consequence of certain changes in the latter 's position International Law, 5th edn. p. 151. " In this sense, though the people of India gave themselves a Constitution, there was no State succession in so far as the people of Sant State were concerned. For them the State succession was over sometime before. No doubt, when the Dominion of India became a sovereign Democratic Republic, there was a breaking away from the British Crown, but that was a State succession in a different field. We are not concerned with the secession of India from the British Crown, but with State succession between Sant State and India, and there was no second succession in 1950. Whatever had happened had already happened in 1948 when Sant State merged with the Dominion of India. The Act of State which began in 1948 could continue uninterrupted even beyond 1950 and it did not lapse or get replaced by another Act of State. The Constitution no doubt guaranteed the rights of citizens after 1950 but these rights granted by the Ruler were fort recognised even before 1950 and the Constitution gave its support to those rights which were extant on January 26, 1950. It only remains to consider the argument of Mr. Purushotham based on the view of Chief Justice John Marshall, of the Supreme Court of the United States expressed in U.S. vs Percheman(3) followed by Cardozo J. in 1937 (1) e.g. Fusion of Serbia with croat etc. to form Yugoslavia. (2) e.g. Hawaii in U.S.A. (3) e.g. India and Pakistan. (4) e.g. U.S.A. from Britain. (5) ; at 86, 87. 550 in Shapleigh vs Mier(1). It was there laid down that private ownership is not disturbed by changes in sovereignty and that according to the modern usage of nations a cession of territory is not understood to be cession of the property of the inhabitants. These two cases were referred to in the judgment of Bose J. in Virendra Singh 's case (2) who pointed out that these principles were also reflected in the Sixth Advisory Opinion of September 10, 1923 of the Permanent Court of International Justice. Mr. Purushotham cited other cases where the Supreme Court of the United States had considered obligations which old Spanish and Maxican treaties had created. It was argued that this represents the modern and progressive view and we were asked to revise the entire law of Act of State as understood in India during the past 100 years and particularly the last dozen years. The principle on which this Court has acted in the past few years has been amply indicated earlier in this judgment. It may be summarized in the words of Fletcher Moulton, L. J. in Salaman vs Secretary of State for India(3): "An Act of State is essentially an exercise of sovereign power, and hence cannot be challenged, controlled or interfered with by municipal courts. Its sanction is not that of law, but that of sovereign power, and, whatever it be, municipal courts must accept it, as it is without question. But it may, and often must, be part of their duty to take cognizance of it. For instance, if an act is relied on as being an act of State, and as thus affording an answer to claims made by a subject, the courts must decide whether it was in truth an act of State, and what was its nature and extent". The Courts in England have also acted on the further principle which may be shortly stated in the words of Lord McNair(4): (1) ; at 470. (2) ; (3) (1906] 1 K. B. 613. (4) International Law Opinions (1956) Vol ; See also O 'Connel Y. B. 551 "The term 'Act of State ' is used, not only narrowly to describe the defence explained above, but also, perhaps somewhat loosely, to denote a rule which is wider and more fundamental namely, that 'those acts of the Crown which are done under the prerogative in the sphere of foreign affairs ' (sometimes called 'Acts of State ' or 'Matters of State '); for instance, the making of peace and war, the annexation or abandonment of territory, the recognition of a new State or the new Government of an old State, etc., cannot form the basis of an action brought against the Crown, or its agents or servants, by any person British or alien, or by any foreign State, in British Municipal Tribunals. Such acts are not justiciable in British Courts, at the suit either of British subjects or of aliens; they may form the subject of political action in Parliament or, when the interests of foreign States or their nationals are involved, of diplomatic protest or of any international judicial process that may be available". We are not concerned with the obligations created by treaty which according to the opinions of some writers 'run with the land ' and bind the territory. Other writers, as pointed out by Lord McNair in his Law of Treaties by Keith in his Theory of State Succession and Crandall in Treaties, Their Making and Enforcement. hold that on cession, the treaties are abrogated automatically. Such a view was taken by the United Kingdom and United States when Algiers was annexed by France and by the former when South Africa was annexed by Great Britain and by the United States when Korea was annexed by Japan in 1910. (See Mervyn jones B. Y. B. ; Dr. C. W. Jenks B. Y. B. On the other hand, the treaties of the annexing or cessionary State are held to apply to the new territories. These are treaties with other States which is not the case here. Where is the treaty here? The rights conferred by the Ruler were not the result of a treaty. Nor 552 can the Merger agreement be exalted to the position of a treaty. There is no treaty involved here. Even if it were possible to hold that there was a treaty between the Ruler and the Central Government, there is no power in the Municipal Courts in India to pronounce upon the Agreement as the subject is outside their jurisdiction by reason of article 363. This distinguishes the jurisdiction and power of the Supreme Court of the United States in which consideration of treaties is included. The bar of our Constitution also precludes the consideration whether these agreements can be to be of the nature of treaties. As regards the principles of International Law, it may be pointed out that after the Report of the Transvaal Concessions Commission and Professor Keith 's theories in his book, the attention of the world communities has indeed been drawn to the preservation of economic concessions and acquired rights by the annexing or cessionary State. When the Indian Islands were ceded to Greece the Law Officers (Sir Robert Phillimore was one of them) advised: "Both according to the principles of International Law and the practice of all civilised States, ceded territories pass, cum onere to the new sovereign. ' (Opinion of 15th August, 83/2287.) McNair International Opinions, Vol. 1 p. 156. Similar advice was given on the occasion of annexation of Peruvian territory by Chile (1884), of Madagascar by France (1896), cession of Cuba and the Philipines by Spain (1898). McNair ibid pp. 157 et seq. Again at the annexation of the Boer Republics between 1900 and 1909 what should be the attitude of Britain led to domestic controversy. The legal advisor to the High Commissioner advised that responsibility arising from obligations incurred by the South African Republic and Orange Free State could be repudiated but the Law Officers in England reported that a Government annexing territory annexes it subject, speaking generally, to such legal obligations as have been incurred by the previously existing Government. The obligations included concessionary contracts but the Law Officers added a 553 rider that "the duty to observe such contracts cannot be enforced in a municipal court; it rests merely on the recognition of International Law of what is equitable upon the acquisition of property of the conquered State" (see opinion of 30th November, 1900, F.O. quoted by B. Y. B. 1950 at p. 105). The Transvaal Concessions Commission made its report in April 1901. The report said inter alia: "After annexation, it has been said, the people change their allegiance, but their relations to each other and their rights of property remain undisturbed; and property includes rights which lie in contract. Concessions of the nature of those which are the subject of enquiry present examples of mixed public and private rights : they probably continue to exist after annexation until abrogated by the annexing State, and as a matter of practice in modern times, where treaties have been made on cession of territory, have often been maintained by agreement. " The Commission, however said that no rule of International Law compelled this but added that the best modern opinion favoured that such rights should be respected. The distinction between what is a rule of law and what is a rule of ethics was criticised : see Westlake in (1901) 17 Law Quarterly Review p. 395. However, Prof. Keith gave support to the view. The report of the Commission was considerably influenced by the opinion in Cook vs Sprigg(1) International experts, however, in drafting the terms of settlement of the first Balkan War accepted a new formula in 1920 by which the cessionary State was treated: as subrogated in all rights and changes. These opinions were put to test in some cases before the Permanent Court of International Justice in connection with the Jaffa Concessions and the case of the German Settlers Case. In the former, the Court decided, for technical reasons, that it had no jurisdiction but added that "if Protocol XII left intact the general principles of subrogation," the administration of Palestine was bound to recognise the Jaffa, (1) 554 Concessions "in consequence of the general principles of International Law." In the case of Settlers of German origin in territory ceded by Germany to Poland and German interest in Upper Silesia case (P.C.I.J. series B No. 6 and series A No. 7) the doctrine of acquired rights was accepted, in respect of private rights. The term "acquired rights" has not received a consistent meaning in this connection. It is not the notion of ius quaesitum which was the result of juristic activity following upon the social contract theory. In International Law, it has different meanings. At one extreme is the view that it must be "a grant to an individual of rights under municipal law which touch public interest" and at the other end "every economic concession" is held included. Of course even International Law does not recognise,a universal succession. The term economic concessions" must involve a contract between the State or a public authority on the one hand and a concessionaire on the other and must also involve an investment of capital by the latter for erection of public works or exploitation in the public sector. Such cases are the Mavromma is case, Lighthouses case, Lighthouses in Crete and Samos case (P.C.I.J. Series A No. 5 and Series A B No. 62 and 71 ). Cases of mere private rights without any corresponding benefit to the public are not regarded as concessions but there are two cases in which it has been ruled that private rights must be respected. They are the case of Poland mentioned above. Most of the cases deal with Concessions in which there are reciprocal advantages. All this recognition is still in the diplomatic field. It has never gone beyond political consideration except in the United States. The cases of the United States are mostly to be found in 2 12 Peters and the leading case is U. section vs Percheman (1). Occasionally the question of concessionary rights has been considered in the Courts in England : but of that latter. In U. section vs Percheman(1), Chief Justice John Marshall observed: "It may not be unworthy of remark that it is very unusual, even in cases of conquest for the (1) 555 conqueror to do more than to displace the sovereign and assume dominion over the country. The modem usage of nations, which has become law, would be violated; that sense of justice and of right which is acknowledged and felt by the whole civilised world would be outraged, if private property should be generally confiscated, and private rights annulled. The people change their allegiance; their relation to (their ancient sovereign is dissolved; but their relations to each other, and their rights of property remain undisturbed. If this be the modern rule even in cases of conquest, who can doubt its application to the case of an amicable cession of territory?. . A cession of territory is never understood to be a cession of the property belonging to its inhabitants. The King cedes that only which belonged to him. Lands he had previously granted were not his to cede. Neither party could so understand the cession. Neither party could consider itself as attempting a wrong to individuals, condemned by the practice of the whole civilised world. The cession of a territory by its name from one sovereign to another, conveying the compound idea of surrendering at the same time the lands and the people who inhabit them would be necessarily understood to pass the sovereignty only, and not to interfere with private property. " These words of Chief Justice Marshall have been quoted in legal opinions and have influenced international opinion. The question has been raised that we must accent this as the exposition of the law to be applied by municipal courts here. The doctrine in the United States is not unlimited. Limitations were pointed out by Chief Justice John Marshall himself in the case of Foster vs Nielson(1). That case (1) ; 556 involved the effect upon private land titles of a phrase in an Article of a treaty with Spain. That phrase was "shall be ratified and confirmed to those in possession". It was, as the Chief Justice said, in the "language of contract" and. it required legislative implementation before titles could be claimed. This has led to a differentiation between self executing treaties and non self executing treaties. Says Chief Justice John Marshall: "A treaty is in its nature a contract between two nations, not a Legislative Act. It does not generally effect, of itself, the object to be accomplished, especially so far as its operation is infra territorial; but is carried into execution by the sovereign powers of the respective parties to the instrument. In the United States a different principle is established. Our Constitution declares 'a treaty to be the law of the land. It is, consequently, to be regarded in courts of justice as equivalent to an Act of Legislature, whenever it operates of itself without the aid of any legislative provision. But when the terms of the stipulation import a contractwhen either of the parties engages to perform a particular act the treaty addresses itself to the political, not the Judicial Department; and the Legislature must execute the contract before it can become a rule for the Court. " In India, the position is different. Article 253 enables legislation to be made to implement international treaties. This means that the law would bring the treaty in the field of municipal law. The matter was considered in one cam Birma vs The State(1), where the High Court declared: "Treaties which are a part of international law do not form part of the law of the land unless expressly made so by the legislative authority". This accords with what has been said by me but the judgment seems to suggest that treaties which do not affect private (1) A.I.R. [1951] Rai. 557 rights also require legislative implementation. This is not quite accurate, because it is not necessary that all treaties must be made a part of municipal law. I agree with Alexander in "International Law in India" in International and Comparative Law Quarterly (1952) p. 289 at p. 295. Preuss [Michigan Law Review (1953) p. 1123 n. 151 calls it a rare example of a treaty which was not enforced without legislative sanction. The only other example he gives is Re Arrow River and Tributaries Slide and Boom Co. Ltd. see B.Y.B. (1953) 30, pp. 202, 203. The precedent of the United States cannot be useful because it has been held by the Supreme Court of the United States that, although the Courts have no power to question the validity of the Act of State, they can consider its effect. See U. section vs Percheman(1) at P. 86 and that the enunciation of treaties must be accepted by Courts, Clark vs Allen (2). Our practice and Constitution shows that there are limitations upon the powers of Courts in matters of treaties and Courts cannot step in where only political departments can act. The power of the Courts is further limited when the right is claimed against the political exercise of the power of the State. Again, the right claimed here is not even a concessionary right such as he has received the support of international writers. It is more of the nature of a gift by the ruler at the expense of the State. It lacks bona fides which is one of the things to look for. There is no treaty involved and whatever guarantee there is, the Constitution precludes the municipal courts from considering. Politically and ethically there might have been some reason to accept and respect such concessions but neither is a reason for the municipal courts to intervene. The position of the municipal courts according to English Jurisriudence has been noticed in earlier cases. To them may be added the following considerations. In Amodu Tijani vs Secretary, Southern Nigeria (3) it was said: "a mere change in sovereignty is not to be presumed as meant to disturb rights of private owners, and (1) (2) ; (3) 558 the general terms of a cession are prima facie to be construed accordingly." (p. 407). Again, in West Rand Central Gold Mining Co. vs Regem(1), it was said: "It must not be forgotten that the obligations of conquering states with regard to private property of private individuals, particularly land as to which the title had already been perfected before the conquest or annexation are altogether different from the obligations which arise in respect of personal rights by contracts. " The observations in Amodu Tijani 's case(2) were cited before the Privy Council in Sardar Rustam Khan 's case(3). But Lord Atkin after referring to all cases from Kamachee Boye Saheba(4), referred to the observations of Lord Halsbury in Cook vs Sprigg(5). "It is well established principle of law that the transactions of independent States between each other are governed by other laws than those which municipal courts administer. It is no answer to say that by the ordinary principles of international law private property is respected by the sovereign which accepts the cession and assume the duties and legal obligations of the former sovereign with respect of such private property within the ceded territory. All that can be properly meant by such a proposition, is that, according to the well understood rules of international law, a change of sovereignty by cession ought not to affect private property, but no municipal tribunal has authority to enforce such an obligation". Lord Atkin referred in his judgment to Secretary of State vs Bai Raibai(6) and Vajje Singh 's case(7 ) as laying the (1) (3) (1941) 68 I. A. 109.(4) (1859.) ; (5) (6) (1915) L. R. 42 I.A. 229. (7) (1924) L. R. 51 I.A. 357. 559 limits of the jurisdiction of municipal courts. These cases have been applied in several decisions by this Court and the view of the Supreme Court of the United States or the view taken in International Law has not been accepted. It is not that the Courts in England have not been pressed by the rules of International Law as a science. As Westlake pointed out in the Nature and ]Extension of Title by Conquest (op. cit.): "The authorities on the law of England appear to be prepared to pay that homage ;to international law. We may refer to what was said by Vice Chancellor Lord Cranworth in King of the Two Sicilies vs Willcox, I Sim. N.S. 327 9, and by Vice Chancellor Wood in United States of America vs Prioleau, ; and to the generality of the proposition laid down by Vice Chancellor James in United States of America vs Mcrae, L.R.8. 'I apprehend it, ' he said, 'to be the clear public universal law that any government which de facto succeeds to any other government, whether by revolution or restoration, conquest or reconquest, succeeds to all the public property, to everything in the nature of public (property, and to all rights in respect of the public property, of the displaced power, whatever may be the nature or origin of the title of such displaced powers". But the rule that the Act of State can be questioned in a Municipal Court has been adopted and it has been considered that it is a matter for the political departments of the State. To quote from Cook vs Sprigg(1). ". if there is either an express or a well understood bargain, between the ceding potentate and the Government to which the cession is made, that private property shall be respected, that is only a bargain which can be enforced by sovereign (1) 560 against sovereign in the ordinary course of diplomatic pressure. " I do not, therefore, accept the contention that a change of opinion is necessary. Even Bose J., did not decide in Virendra Singh 's case(1), on the basis of international law or the opinion of the Supreme Court of the United States. In my opinion, these are matters for the political department of the State. However, desirable it may be that solemn guarantees should be respected, we cannot impose our will upon the State, because it is outside our jurisdiction. For these reasons, I would accept the appeals and would set aside the judgment under appeal and restore the decrees dismissing the suits with costs throughout. SHAH J. The Ruler of Sant State had made grants of villages to jagirdars but without right to trees. On March 12, 1948, the Ruler issued an order reciting that the holders of the villages were not given "rights of the forests" and after considering the complaints of certain jagirdars they were given full rights and authority over the forests in the villages under their vahivat. The jagirdars were directed to manage "the forests according to the policy and administration of the State". The respondents claim in these appeals that the rights of the grantees to the forests were not liable to be cancelled by the Dominion of India after the merger of the State of Sant in June 1948, and by executive action the Government of Bombay was not competent to obstruct the exercise of those rights. Pursuant to the agreement dated March 19, 1948 as from June 1, 1948, the State of Sant merged with the Dominion of India. The sovereignty of the Ruler was thereby ,extinguished and the subjects of the Sant State became citizens of the Dominion of India. Accession of one State to another is an act of State and the subjects of the former State may, as held in a large number of decisions of the Judicial Committee and of this Court, claim protection of only such rights as the new sovereign recognises as enforceable 'by the subjects of the former State in his municipal courts. (1) ; 561 In The Secretary of State in Council of India vs Kamachee Boye Saheba(1) the jurisdiction of the courts in India to adjudicate upon the validity of the seizure by the East India Company of the territory of Rajah of Tanjore as an escheat, on the ground that the dignity of the Raj was extinct for want of a male heir, and that the property of the late Rajah lapsed to the British Government, fell to be determined. The Judicial Committee held that as the seizure was made by the British Government, acting as a sovereign power, through its delegate the East India Company it was an act of State, to, inquire into the propriety of which a Municipal Court had no Jurisdiction. Lord Kingsdown observed at p. 529: "The transactions of independent States between each other are governed by other laws than those which Municipal Courts administer: Such Courts have neither the means of deciding what is right, nor the power of enforcing any decision which they may make. " In Vajesingji joravarsingji vs Secretary of State for India Council(1) the Board observed (at p. 360): ". when a territory is acquired by a sovereign State for the first time that is an act of State. It matters not how the acquisition has been brought about. It may be by conquest, it may be by cession following on treaty, it may be by occupation of territory hitherto unoccupied by a recognized ruler. In all cases the result is the same. Any inhabitant of the territory can make good in the municipal courts established by the new sovereign only such rights as that sovereign has, through his officers, recognised. Such rights as, he had under the rule of predecessors avail him nothing. Nay more, even if in a treaty of cession it is stipulated that certain inhabitants should enjoy certain rights, that does not give a title to those (1) 7 Moode 's I.A. 476. (2) L.R. 51 I.A. 357. 184 159 s.c. 476. 562 inhabitants to enforce these stipulations in the municipal courts. The right to enforce remains only with the high contracting parties." In Secretary of State vs Sardar Rustam Khan and Others(1) in considering whether the rights of a grantee of certain proprietary rights in lands from the then Khan of Kalat, ceased to be enforceable since the agreement between the Khan and the Agent to the Governor General in Baluchistan under which the Khan had granted to the British Government a perpetual lease of a part of the Kalat territory, at a quit rent, and had ceded in perpetuity with full and exclusive revenue, civil and criminal jurisdiction and all other forms of administration, it was observed by Lord Atkin delivering the judgment of the Board that : ". in this case the Government of India bad the right to recognise or not recognise the existing titles to land. In the case of the lands in suit they decided not to recognize them, and it follows that the plaintiffs have no recourse against the Government in the Municipal Courts. " The rule that cession of territory by one State to another is an act of State and the subjects of the former State may enforce only those rights which the new sovereign recognises has been accepted by this Court in M/s. Dalmia Dadri Cement Co. Ltd. vs The Commissioner of Income tax(2); jagannath Agarwala vs State of Orissa (3); Promod Chandra Deb and Others vs The State of Orissa and Others(4) and The State of Saurashtra vs Jamadar Mohamad Abdulla and others(5), and may be regarded as well settled. Mr. Purshottam on behalf of the respondents however contended that this rule was a relic of the imperialistic and expansionist philosophy of the British Jurisprudence, which (1) L. R. 68 I.A. 109. (2) [1959] S.C.R. 729. (3) ; (4) [1962] Suppl. 1 S.C.R.405. (5) 563 is inconsistent with our Constitutional set up. Counsel submits that in jurisdictions where truly democratic institutions exist the rule laid down by the Judicial Committee has not been accepted. The rule is, counsel submits, inconsistent with the true spirit of our Constitution, which seeks to eschew all arbitrary authority, and establishes the rule of law by subjecting every executive action to the scrutiny of the courts and to test it in the light of fundamental rights. Counsel says that the true rule should be the one which has been recognized by the Supreme Court of the United States that of the accession of a State to another, private rights of the citizens enforceable against their sovereign are not affected, and may be enforced in the Courts of the new sovereign. In support of this argument Mr. Purshottam relied upon the observations made by Marshall, C. J., in United States vs Percheman(1): "The people change their allegiance; their relation to their ancient sovereign is dissolved; but their relations to each other, and their rights of property, remain undisturbed. If this be the modern rule even in cases of conquest, who can doubt its application to the case of an amicable cession of territory ? A cession of territory is never understood to be a cession of the property belonging to its inhabitants. The king cedes that only which belonged to him. Lands he had previously granted were not his to cede. Neither party could consider itself as attending a wrong to individuals, condemned by the practice of the whole civilised world. The cession of a territory by its name from one sovereign to another, conveying the compound idea of surrendering, at the same time the lands and the people who inhabit them, would be necessarily understood to pass the sovereignty only, and to interfere with private property. " But the rights and their enforceability in the Municipal Courts of a State must depend upon the will of the sovereign. The sovereign is the fountain head of all rights, all laws and (1) (1833] ; , at 86, 87. 564 all justice within the State and only those rights which are recognised by the sovereign are enforceable in his Courts, The Municipal Courts which derive their authority from their sovereign and administer his laws cannot enforce the rights Which the former sovereign whose territory has merged or been seized by the new sovereign recognised but the new sovereign has not, for the right to property of the citizen is only that right which the sovereign recognises. It may also be observed that the constitutional provisions in the United States are somewhat different. Under the Con stitution of the United States each treaty becomes a part of the law of the land, the provisions thereof are justiciable and the covenants enforceable by the Courts. Recognition of the rights of the citizens of the acceding State being the prerogative of the sovereign, if rights be recognized by treaty which by the special rules prevailing in the United States become part of the law of the land, they would be enforceable by the Municipal Courts, Under the rule adopted by this Court, a treaty is a contract between two nations, it creates rights and obligations between the contracting States. but there is no judicial tribunal which is competent to enforce those rights and obligations. The treaties have not the force of law and do not give rise to rights or obligations enforceable by the Municipal Courts as observed by Hyde in his 'International Law" vol. 1 p. 433: "Acknowledgement of the principle that a change of sovereignty does not in itself serve to impair rights of private property validly acquired in areas subjected to a change, does not, of course. touch the question whether the new sovereign is obliged to respect those rights when vested in the nationals of foreign States, such as those of its predecessor. Obviously, the basis of any restraint in that regard which the law of nations may be deemed to impose must be sought in another quarter. " The observations made by Marshall C. J., have received repeated recognition in treaties of cession concluded by the 565 United States. But as observed by Lord Halsbury in cook vs Sprigg(1) "It is a well established principle of law that the transactions of independent States between each other are governed by the others, laws than those which Municipal Courts administer. it is no answer to say that by the ordinary principles of international law private property is respected by the sovereign which accepts the cession and assumes the duties and legal obligations of the former sovereign with respect to such private property within the ceded territory. All that can be properly meant by such, a proposition is that according to the well understood rules of international law a change of sovereignty by cession ought not to affect private property, but no municipal tribunal has autho rity to enforce such an obligation. " It was then urged that by cl. 7 of the letter of guarantee written by Mr. V. P. Menon on behalf of the Government of India on October 1, 1948, which was to be regarded as expressly stated in that letter, as part of the merger agreement dated March 19, 1948, the Government of India had undertaken to accept all orders passed and actions taken by the Ruler prior to the date of handing over of the adminis tration to the Dominion Government. Clause 7 of the letter is in the following terms: "No order passed or action taken by you before the date of making over the administration to the Dominion Government will be questioned un less the order was passed or action taken after the 1st day of April 1948, and it is considered by the Government of India to be palpably unjust or unreasonable. The decision of the Government of India in their respect will be final." But by virtue of article 363 of the Constitution, it is not open to the respondents to enforce the covenants of this agree (1) 566 ment in the Municipal Courts: Maharaj Umeg Singh and Others vs The State of Bombay and ohers(1). It was then urged that the Government of Bombay as delegate of the Dominion of India had recognised the right of the respondents when they were permitted to cut the forests. But the plea of recognition has no force. It is true that some of the forests were permitted to be cut by the contractors under special conditions pending decision of the Government of Bombay. The Conservator of Forests North Western Circle had ordered that the question as to the approval to be given to the agreement dated March 12, 1948, was under the consideration of the Government and that written undertakings should be taken from the jagirdars, inamdars or persons concerned that they would abide by the decision or orders passed by the Bombay Government in respect of such private forests when the question of rights over such private forests will be finally settled. On January 9, 1949, on the application of the jagirdar the Divisional Forest Officer agreed to issue authorisation to the contractor valid upto March 31, 1949, subject to the condition that export outside was not to be permitted pending receipt of the orders by the Government and that a written undertaking was given by the purchaser that he would abide by the decision and orders passed by Government. In pursuance of this arrangement undertakings were given by the contractors and the jagirdars agreeing to abide by the decision and the orders to be passed by the Government of Bombay in respect of the forest rights and admitting that the authorization issued by the Divisional Forest Officer was subject to those undertaking. The Forest Officers therefore did not allow the forests to be worked unconditionally. Cutting of trees in the forests by the contractors was permitted subject to certain terms and conditions and on the clear undertaking that the question as to the right and the terms under which they could cut the forests would be decided by the Government. The Government of Bombay on July 8, 1949, resolved that the order passed by the Ruler of the Sant State dated March 12, 1948, transferring forest rights to holders of the (1) ; 567 jagirs villages were mala fide and that they should be can celled, but before taking further action in the matter, the Commissioner should ascertain whether the possession of the forests in question was with the Government or was with the jagirdars. The order proceeded to state: "It the possession is still with Government please ask the Officer of the Forest Department to retain the same and to refuse to issue passes, etc., to private contractors and purchasers '. A copy of this order was forwarded to the Forest Officers, Santrampur for information and guidance and it is found endorsed on that order that no transit passes be issued to the jagirdars to whom rights over forests were conceded in March 1948 and all further felling in such jagir forests should be stopped at once and compliance reported. It is true that the order of the Governor was not directly communicated to the jagirdars or the contractors. But if the conduct of the Forest Officers in permitting cutting of the forests is sought to be relied upon, it would be necessary to take into consideration the orders passed by the Conservator of Forests, North Western Circle, the undertakings given by the contractors and the jagirdars and the order passed by the Governor of Bombay and the execution of that order by stoppage of the cutting of the forests. It appears that cutting of trees in forests was permitted only upto some time in 1949 and was thereafter stopped altogether by order of the Revenue Department. The final resolution cancelling the agreement was passed on February 6, 1953. It was recited in the resolution that the Tharav issued by the Ruler in 1948 had been considered by the Government to be mala fide and the same had already been repudiated and it was not binding on the Government of Bombay both by law and under the agreement of integration, in spite of the assurance contained in the collateral letter. It was also recited. "Since the Tharav has not been recognised by Government but has been specifically repudiated, everything done in pursuance thereof including the contracts entered into after passing of the Tharav. is not valid and, therefore, binding on this Government. " 568 Having regard to the conduct of the Officers of the Govern ment of Bombay and the resolution of the Government, the plea that the Government of Bombay as delegate of the Do minion had renounced its right not to regard itself as bound by the order made by the Ruler of Sant State cannot be sustained. The next question which falls to be determined is whether the order can be regarded as "law" within the meaning of cl.4 of the Administration of the Indian States Order, 1948. Clause 4 (1) provided: "Such provisions, or such parts of provisions (a) of any law, or (b) of any notification, order, scheme, rule, form or bye law issued, made or prescribed under any law, as were in force immediately before the appointed day in any Indian State shall continue in force until altered, repealed or amended by an order, under the Extra Provincial Jurisdiction Act, 1947 (XLVII of 1947): Provided that the powers that were exercised by the Ruler of an Indian State in respect of or in relation to such Indian State under any such provisions of law immediately before the appointed day, shall be exercised by the Pro vincial Government or any officer specially empowered in this behalf by the Provincial Government. " It was urged that the order issued by the Ruler of Sant State was either "law" or an "order made or prescribed under any law" in force immediately before the appointed day and by virtue of cl. 4 of the Administration of the Indian States Order, it must be deemed to have remained in operation and any action taken in contravention thereof by executive action was unjustified. Our attention has not been invited to any statutory provisions relating to forests in the State of Sant, nor does the order dated March 12, 1948, purport to be issued in exercise of any statutory power. On the face of it the order grants certain rights in forests which had not been previously granted to the jagirdars by the 569 Ruler. It is urged that the Ruler of Sant was an absolute Ruler in whom were vested all authority legislative, execu tive and judicial, and whatever he did or directed had to be complied with and therefore his actions and directions must be deemed to be "law" within the meaning of cl. 4 of the Administration of the Indian States Order. But the fact that ;the Ruler of Sant State was an absolute Ruler not bound by any constitutional limitations upon the exercise of his powers does not, in my judgment, invest every exercise of his powers with legislative authority. The functions of a State whether it contains a democratic set up or is administered by an autocratic sovereign fall into three broad categories executive, legislative and judicial. The line of demarcation of these functions in an absolute or autocratic form of Government may be thin and may in certain cases not be easily discernible. But on that account it is not possible to infer that every act of an autocratic sovereign has a legislative content or that every direction made by him must be regarded as law. That an act or an order of a sovereign with absolute authority may be enforced and the subjects have no opportunity of getting redress against infringement of their rights in the Municipal Courts of the State will not be decisive of the true character of the functions of the sovereign in the exercise of which the act was done or the order was made. The distinction between functions executive, legislative and judicial vested in one person may not be obliterated, merely because they are in fact exercised or are capable of being exercised indiscrimi nately. In the ultimate analysis, the legislative power is the power to make, alter. amend or repeal laws and within,; certain definite limits to delegate that power. Therefore it is power to lay down a binding rule of conduct. Executive power "is the power to execute and enforce the laws, and judicial power is power to ascertain, construe and determine the rights and obligations of the parties before a Tribunal in respect of a transaction on the application of the laws and even in an absolute regime this distinction of the functions prevails. If an order is made during the regime of a sovereign who exercises absolute powers, and it is enforced or executed leaving nothing more to be done there 570 under to effectuate it, any discussion of its true character would be an idle exercise. Where however in a set up in which the rule of law prevails, to support action taken pursuant to an order you have to reach the source of autho rity in the power of the previous autocratic sovereign, the true nature of the function exercised may become important, when the laws of the former State are by express enactment continued by the new sovereign. The order dated March 12, 1948, conveys to the jagirdars rights which had been previously excluded from the grants. The form of the order is of course not decisive. An important, test for determining the character of the sovereign function is whether the order expressly or by clear implication prescribes a rule of conduct governing the subject which may be complied with a sanction demanding compliance therewith. The order dated March 12, 1948, is expressly in the form of a grant of the rights which were not previously granted and does not either expressly or by implication seek to lay down any binding rule of conduct. I am therefore unable to hold that the order issued on March 12, 1948, by the Ruler of Sant State was "law" or an order made under any law within the meaning of cl. 4 of the Administration of the Indian States Order. Cases which have come before this Court in which the question as to the binding effect of orders issued by the Rulers of the former Indian States fell to be determined clearly illustrate that principle. In Ameer un Nissa Begum and others vs Mahboob Begum and others(1) the question as to the binding character of two 'Firmans ' dated February 24, 1949, and September 7, 1949, issued by H. E. H. the Nizam of Hyderabad fell to be determined. The Court in that case observed (at p. 359); "The 'Firmans ' were expressions of the sovereign will of the Nizam and they were binding in the same way as any other law , nay, they would override all other laws which were in conflict with them. So long as a particular 'Firman ' held the field, that alone would gov (1) A I.R. 571 ern or regulate the rights of the parties con cerned, though it could be annulled or modi fied by a later 'Firman ' at any time that the Nizam willed. " The Court declined to consider whether the 'Firmans 'were in the nature of "legislative enactment" or "judicial orders" and observed: "The Nizam was not only the supreme legislature, he was the fountain of justice as well. When he constituted a new Court, he could, according to ordinary notions, be deemed to have exercised his legislative authority. When again he affirmed or reversed a judicial decision, that may appropriately be described as a judicial act. A rigid line of demarcation, however, between the one and the other would from the very nature of things be not justified or even possible. " In that case the primary question which the Court had to consider was whether certain 'Firmans ' issued by the Nizam could be enforced. It was held that the order may be legislative or judicial in character, but it could not be regarded as executive. It may be noticed that no action was required to be taken after the cessor of the sovereignty of the Nizam, in pursuance of the 'Firmans '. The 'Firmans ' had become effective, and titles of the parties stood adjusted in the light of those 'Firmans ' during the regime of the Nizam. In Director of Endowments. Government of Hyderabad vs Akram Ali(1) the effect of a 'Firman ' issued by the Nizam on December 30. 1920, directing that the Ecclesiastical Department to supervise a Dargah within the jurisdiction of the Nizam until the rights of the parties were enquired into and adjudicated upon by a civil court fell to be determined. The Court in that case held that the right of Akram Ali who claimed to be hereditary Sajjad Nashin and Mutwalli was subject to the order of the Nizam which had been passed before the Hyderabad State merged with the Union of India and the applicant having no rights it could (1) A.I.R. 1956 S.C. 60. 572 be enforced at the date of the Constitution and the Courts were incompetent to grant him relief till the rights were determined by the Constitution. The effect of the 'Firman ' was to deprive the respondent Akram Ali and all 'other claimants of all rights to possession pending enquiry into the case. It is clear from the observations made in that judgment that the only decision of the Court was that by the 'Firman ' the rights of the Sajjad Nashin and Mutwalli was suspended till determination by the civil court of his right to possession. The 'Firman ' was given effect not because it was regarded as the expression of the legislative will but because it had become effective before the Constitution came into effect suspending the rights of the applicant. In Madhorao Phalke vs The State of Madhya Bharat(1) the true character of certain 'Kalambandis ' issued by the Rulers of Gwalior fell to be determined. The appellant was the recipient of a hereditary military pension granted by the Ruler of Gwalior to his ancestors in recognition of their military services. The right to receive pension was recognised by the 'Kalambandis ' of 1912 and 1935 issued by the Ruler. After the formation of the State of Madhya Bharat under the Constitution, the Government of that State by an executive order terminated the right of the appellant. The 'Kalam bandis ' though not issued in the form of legislative enactments were issued for the administration of the department relating to the Shiledari units. and the nature of the provisions unambiguously impressed upon them the character of statutes or regulations having the force of law. The 'Kalambandis ' recognised and conferred hereditary rights: they provided for the adoption of a son by the widow of a deceased Silledar subject to the approval of the State and also for the maintenance of widows out of funds specially set apart for that purpose, and contemplated the offering of a substitute when a silledar became old or otherwise unfit to render service: they made detailed provi sion as to mutation of names after the death of a silledar. They further enacted that the Asami being for the shiledari service it could not be mortgaged for a debt of any banker, and if a decree holder sought to proceed against the amount (1) ; 573 payable to him, execution had to be carried out in accord ance with and in the manner and subject to the limitations prescribed in that behalf. The 'Kalambandis ' were not treated as administrative orders issued merely for the pur pose of regulating the working of the administration of the department of irregular forces, and were therefore to be re garded as regulations having all the characteristics of legislative enactments. In Promod Chandra Deb 's case(1) the true character of ,certain 'Khor Posh ' grants granted by the Rulers of Talcher, Bamara and Kalahandi fell to be determined, in a group of petitions for enforcement of fundamental rights. Out of the four petitions, petition No. 167 of 1958 was dismissed ,on the ground that under an order passed by the Extra Provincial Jurisdiction Act, 1947, a grant made by the Ruler ,of Bamra in favour of the petitioner was annulled before Bamra became part of the Union of India and the right created by the grant had on that account ceased to exist. In two other petitions Nos. 168 of 1958 and 4 of 1959 it was found by the Court that the maintenance grants in favour of certain members of the family of the Ruler were recognised by the Government of India 'and the right thus recognised was given effect to and payments pursuant thereto were continued for nearly eight years after the merger of the State. This Court held that the State having recognized its obligation to pay the maintenance grants which were agreed to be granted under the statutory law and the custom of the State, the grants could not be annulled by executive action. In the principal writ petition No. 79 of 1957 the grants by the Ruler of Talcher was made subject to the terms and conditions laid down under Order 31 of the Rules and Regulations of the State of Talcher of 1937. These Rules and Regulations of Talcher of 1937 were regarded as the law of the State and it was in accordance with the law that the 'Khor Posh ' grants were made by the Ruler. If was held that these grants had the effect of law. Sinha C.J., delivering the majority judgment of the Court observed (at p. 436): "There is also no doubt that the grant made by the ruler of Talcher in favour of the petitioner (1) [1962] Suppl. 1 S.C.R. 405. 574 continued to be effective until the Merger. The nature and conditions of such grant of Khorposh are governed by the provisions of the laws of that State as embodied in Order 31 of the 'Rules and Regulations of Talcher, 1937. Under the laws of Talcher, the petitioner had been enjoying his Khorposh rights until the cash grant, as it became converted in 1943 44 as aforesaid, was stopped by the State of Orissa, in April, 1949. " In the view of this Court the terms and conditions, subject to which the grant was made, were on the facts of the cast in the nature of legislative acts and not exercise of executive functions. The Court in that case did not purport to lay down that any act done by the Ruler whether it be executive, legislative or judicial must be regarded since the merger of the State as in the exercise of the legislative will of the Ruler and therefore continuing as law. In a recent judgment of this Court in Tilkayat Shri Govindlalji Maharaj etc. vs State of Rajasthan and others( ') the 'Firman ' issued by the Udaipur Darbar in 1934 relating to the administration of the temple of Sharnathji at Nath dwara, which was expressly declared to be a public temple, and governing the devolution of the right to the management of the temple, and certain incidental matters, fell to be determined. The 'Firman ' consisted of four clauses. By the first clause it was declared that according to the law of Udaipur the shrine of Shrinathji had always been and was a religious institution for the followers of the Vaishnava Sampradaya and that all the property immovable and movable dedicated, offered or presented to or otherwise coming to the deity Shrinathji had always been and was the property of the shrine and that the Tilkayat Maharaj for the time being was merely the custodian manager and trustee. of the said property for the shrine. The second clause prescribed the rule of succession and declared that it was regulated by the law of primogeniture, and provided that the Udaipur Darbar had absolute right to depose any Tilkayat Maharai on the ground that such Tilkayat Maharaj was unfit. The (1) A.I.R. (1963) S.C. 1638. 575 third clause provided for measures to be taken by the Ruler for management of the shrine during the minority of the Tilkayat Maharaj and by the last clause it was provided that in accordance with the law of Udaipur the Maharana had declared Shri Damodarlalji the then Tilkayat Maharajunfit to occupy the Gaddi and had approved of the succession of Goswami Govindlalji to the Gaddi of Tilkayat Maharaj. This 'Firman ' declared the character of the trust relating to the Shrinathji temple, laid down rules as to the succession and provided for the management during the minority of the Tilkayat, and declared the right of the State to remove the Tilkayat and for enforcement of that right by declaring that the then Tilkayat was unfit to occupy the Gaddi. This was in substance though not in form exercise of the legislative will of the sovereign. Its operation was not exhausted by its enforcement during the regime of the Maharana of Udaipur. Devolution of the Gaddi, and declaration about the power of the Ruler over the shrine were intended to govern the administration of the shrine for all times. It is true that in that case in paragraph 32 it was observed after referring to Madhorao Phalke 's ease(1), Ameer un Nissa Begum 's case (2 ) and the Director of Endowments, Government of Hyderabad 's case(3): "In the case of an absolute Ruler like the Maharana of Udaipur it is difficult to make any distinction between an executive order issued by him 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. " It was not and could not be laid down that all orders issued by an absolute Ruler were legislative in character: it was merely sought to be emphasized that so long as the territory of Udaipur and the shrine were under the sovereignty of the Maharana the distinction between commands legislative and executive was academic, for all orders and commands of the Ruler had to be obeyed alike. But since the merger of the State with the Union of India, the question (1) ; , (2) A.I.R. (1955) S.C. 352. (3) A.I.R. 1956 S.C. 60, 576 whether the 'Firman ' was a mere executive order or a legis lative enactment assumed vital importance. If the command was merely executive unless the rights created thereby were recognized by the Dominion of India they had no validity and no reliance could be placed upon them in the Municipal Courts. If the command was legislative, the laws of the former State having been continued upon merger, the legislative command retained vitality and remained enforceable. In the context in which it occurs the statement set out did not and was not intended to lay down, that there is no distinction between legislative commands and executive orders which have to be enforced after the merger of the State with the Indian Union. I may refer to decisions which illustrate the distinction between legislative commands and executive orders of the Rulers of the former Indian States. In Maharaja Shree Umaid Mills Ltd. vs Union of India and Others(1) the question whether an agreement between the Ruler of Jodhpur and a limited Company whereby the Ruler agreed to exempt or remit certain duties or royalties and to hold the Company not liable to pay taxes and further gave an assurance to the Company to amend the laws so as to make them consistent with the agreement was not regarded as "law" within the meaning of article 372 of the Constitution. In the view of the Court the agreement rested solely on the consent of the parties: it was entirely contractual in nature an a none of the characteristics of law. The Court in that case observed that every order of an absolute Ruler who combines in himself all functions cannot be treated as "law" irrespective of the nature or character of the order passed. There is, it was observed, a valid distinction between an agreement between two or more parties even if one of the parties is the sovereign Ruler, and the law relating generally to agreements; the former rests on consensus of mind, the latter expresses the will of the sovereign. This case supports the proposition that every act done or order passed by an absolute Ruler of an Indian State cannot have the force of law or be regarded as "law" since the merger of his territory with the 'Union of India '. To have the vitality of law after (1) ; 577 merger, it must be the expression of the legislative will of the Ruler, There is yet another judgment of this Court in The Bengal Nagpur Cotton Mills Ltd. vs The Board of Revenue, Madhya Pradesh and Others(1) in which also the question whether an agreement between the Ruler of Rajnandgaon and M/s. Shaw Wallace and Company in connection with the setting up of a textile factory on certain concessional terms in the matter of imposition of octroi duties on imported goods fell to be determined. It was observed in that case: "It is plain that an agreement of the Ruler expressed in the shape of a contract; cannot be regarded as a law. A law must follow the customary forms of law making and must be expressed as a binding rule of conduct. There is generally an established method for the enactment of laws, and the laws, when enacted, have also a distinct form. It is not every indication of the will of the Ruler, however expressed, which amounts to a law. An indication of the will meant to bind as a rule of conduct and enacted with some formality either traditional or specially devised for the occasion, results in a law but not an agreement to which there are two parties, one of which is the Ruler. " The order of the Ruler of Sant dated March 12, 1948, was not in the form of a legislative enactment. It also did not seek to lay down a course of conduct: it merely purported to transmit certain rights which were till the date of the order vested in the Ruler to the jagirdars who were grantees of the villages. It is difficult to hold that an order merely granting forest rights not in pursuance of any legis lative authority, but in exercise of the power of the sove reign in whom the rights were vested, to the jagirdars to whom the villages were granted without forest rights, can be regarded as "law" within the meaning of cl. 4 of the Administration of the Indian States Order, 1948, when the order was not intended to lay down any binding rule of (1) ; (2) 134 154 S.C. 37. 578 conduct of the grantees and merely purported to convey the rights which till then were vested in the Ruler. The other question which remains to be determined is whether the respondents are entitled to the protection of section 299(1) of the Government of India Act, 1935, or article 31 (1) of the Constitution. Undoubtedly the order which deprives them of the right to cut forest trees which they claimed from the jagirdar who derived them under the grant dated March 12, 1948, from the Ruler of Sant is an executive order. Section 299(1) of the Government of India Act, 1935, protection of which was claimed on the merger of the State of Sant with the Dominion of India provided: "No person shall be deprived of his property in British India save by authority of law. " The clause conferred protection upon the property rights of persons against any executive action not supported by law. To attract the clause, there must, however, exist a right to property which is sought to be protected. If for reasons which we have already stated in considering the first question, the subjects of the acceding State are entitled only to such rights as the new sovereign chooses to recognize, in the absence of any recognition of the rights of the respondents or their predecessor jagirdars, there was no right to property of which protection could be claimed. As held by this Court in State of Saurashtra vs Jamadar Mohamad Abdulla and others(1) orders passed by the Administrator of the State of Junagadh appointed on behalf of the Government of India (which had assumed charge of the administration of the State after the Nawab of Junagadh fled the country) on various dates between November 9, 1947 and January 20, 1949, cancelling grants in favour of certain persons in whose favour the grants had previously been made by the Nawab of Junagadh were not liable to be challenged in suits filed by the grantees in the Civil Courts of the Dominion, on the plea that the properties had been taken away without the authority of law. This Court held that the impugned orders cancelling the grants in favour of the respondents and taking of the properties arose out of and during an act of State and they could not be questioned before Municipal Tribunals, for the (1) (1962] 3 S.C.R. 970. 579 orders of cancellation were passed before the change over of de jure sovereignty. There is no support for the assumption made by the res pondents that an act of State arises merely at a fixed point of time when sovereignty is assumed. An act of State may be spread over a period, and does not arise merely on the point of acquisition of sovereign right: see Promod Chandra Deb 's case(1). Nor is the new sovereign required to announce his decision when he assumes or accepts sovereignty over foreign territory, about the rights created by the quondam sovereign, on pain of being held bound by the rights so created. The decision of this Court in jagannath Agarwalla 's case(2) pointedly illustrates this principle. The State of Mayurbhanj merged with the Province of Orissa on January 1, 1949, but an order dated June 28, 1952 made by the Board of Revenue acting on behalf of the State of Orissa rejecting the claim made by a person who had entered into an agreement or arrangement with the Maharaja of Mayurbhanj in 1943 was held to be in the course of an act of State, the rejection of the claim being in pursuance of an order issued under section 4 of the Extra Provincial Jurisdiction Act, 47 of 1947. Therefore till the right to property of the subjects of the former Indian State was recognized by the new sovereign there was no title capable of being enforced in the Courts of the Dominion or the Union. It was then urged that in any event since the enactment of the Constitution, by executive action a person may not be deprived of his right to property, and this protection applies as much to rights granted by the former Rulers to persons who on merger became citizens of the Dominion of India as to rights of property of other citizens. In substance it is urged that even if there was no recognition of the right to property which was granted by the former sovereign by the Dominion Government, after the enactment of the constitution the right granted by the former Rulers may only be taken away by legislative command and not by executive action. This argument proceeds upon a misconception of the nature of the fundamental right conferred by article 31(1) of the Constitution. In terms, the Article confers a right to claim protection against deprivation of property otherwise than by (1) [1962] Suppl. 1 S.C.R. 405. (2) ; 580 authority of law. A right to property is undoubtedly pro tected against all actions otherwise than under the authority of law. But the clause postulates a right to property which is protected. It does not purport to invest a person with a right to property which has not been recognized by the Dominion of India or the Union. Even if the right to property was recognized by the Indian State of which the claimant was subject, so long as it is not recognized by the Dominion or the Union it is not enforceable by the Courts in India. On the merger of the State of Sant with the Dominion of India, undoubtedly the respondents became citizens of the Dominion and they were entitled like any other citizen to the protection of the rights which the Dominion recognized. It has also to be remembered that promulgation of the Constitution did not result in transfer of sovereignty from the Dominion of India to the Union. It was merely change in the form of Government. By the Constitution, the authority of the British Crown over the Dominion was extinguished, and the sovereignty which was till then rooted in the Crown was since the Constitution came into force derived from the people of India. It is true that whatever vestige of authority which the British Crown had over the Dominion of India, since the Indian Independence Act was thereby extinguished, but there was no cession, conquest occupation or transfer of territory. The new governmental set up was the final step in the process of evolution towards self government. The fact that it did not owe its authority to an outside agency but was taken by the representatives of the people made no difference in its true character. The continuance of the governmental machinery and of the laws of the Dominion, give a lie to any theory of transmission of sovereignty or of the extinction of the sovereignty of the Dominion, and from its ashes, the springing up of another sovereign as suggested in Virendra Singh and Others vs The State of Uttar Pradesh(1) which will presently examine. If therefore the respondents had under the Government of India Act, 1935, after the merger not acquired any right to the forests by virtue of any recognition of the Tharav dated March 12, 1948, the promulgation of the Constitution (1) ; 581 did not invest them with any additional rights which would convert either their claims to the forest rights into property or to enable them to enforce in the Indian Courts such claims not recognized by the State as fundamental right to property. By article 31 right to property is protected against all actions save by authority of law. But if there was no right to property, an executive action refusing recognition of a claim to property could not infringe article 31 of the Constitution. In Virendra Singh 's case(1) this Court held that since the promulgation of the Constitution grants which had been made by the previous Rulers, even if they were not recognized by the Dominion of India or the Union, could not be interfered with except by authority of law. In that case the petitioners were grantees from the Rulers of the States of Sarila and Charkhari of certain villages before those States merged with the Dominion of India. The States originally merged with the Union of Vindhya Pradesh, and the Vindhya Pradesh Government confirmed the grants in December 1948. But the Union of the States of Vindhya Pradesh was dissolved, and the covenanting States separately acceded to the Dominion of India, and surrendered all authority and jurisdiction in relation to the governance of the States and executed instrument called 'The Vindhya Pradesh Merger Agreement '. The States which formed the Vindhya Pradesh were transformed into a Chief Commissioner 's Province on January 23, 1950. The grants of the four villages made in favour of the petitioners Were revoked in August 1952 by the Government of the State of Uttar Pradesh to which State those villages being enclaves within its territory were transferred. The grantees of the villages then petitioned this Court under article 32 of the Constitution challenging the validity of the orders revoking the grant of jagirs and maufis in the four villages as violative of articles 31 (1) and 19 (1 ) (f ) of the Constitution. This Court observed that the properties in question were the properties over which the Rulers had right of disposition at the date of the grants, and the grants were absolute in character and would under any civilised system of law pass an absolute and indefeasible title to the grantees and that assuming that the titles were defensible at the mere will of (1) ; 582 the sovereign the fact remained that they were neither resumed by the former Rulers nor confiscated by the Dominion of India as an act of State and upto the 25th of January, 1950, the right and title of the grantees to continue in possession was good and was not interfered with. The Court accordingly held that the Constitution by the authority derived from and conferred by the people of India; destroyed all vestige of arbitrary and despotic power in the territories of India and over its citizens and lands and prohibited just such acts of arbitrary power as the State of Uttar Pradesh in that case was seeking to uphold. It was further observed that the Dominion of India and the States had abandoned their sovereignty and surrendered it to the people of the land who framed the new Constitution of India and as no sovereign can exercise an act of State against its own subjects, the orders of revocation of the grants were invalid. In my view the conclusion of the Court proceeded upon two assumptions, neither of which was true: (i) that the sovereignty of the Dominion of India and of the States was surrendered to the people of India, and in the exercise of the sovereign power the people gave themselves the new Constitution as from January 26, 1950; and (ii) the petitioners who were in de facto possession of the disputed lands had rights in them which they could have enforced upto 26th January, 1950, in the Dominion Courts against all persons except possibly the State. These assumptions are not supported by history or by consti tutional theory. There is no warrant for holding at the stroke of mid night of the 25th January, 1950, all our pre existing political institutions ceased to exist, and in the next moment arose a new set of institutions completely unrelated to the past. The Constituent Assembly which gave form to the Constitution functioned for several years under the old regime, and set up the constitutional machinery on the foundations of the earlier political set up. It did not seek to destroy the past institutions: it raised an edifice on what existed before. The Constituent Assembly molded no new 583 sovereignty:it merely gave shape to the aspirations of the people, by destroying foreign control and evolving a com pletely democratic form of government as a republic. The process was not one of destruction, but of evolution. For reasons already stated it is impossible to hold that what were mere claims to property till the 25th of January, 1950, could be regarded as enforceable against any one. Till the Dominion of India recognised the right, expressly or by implication there was no right to property which the Courts in India could enforce. There is nothing in the Constitution which transformed the claims which till January 25, 1950, had not been recognized into property rights so as to prevent all further exercise of the act of State, and extinguish the powers of the Union to refuse to recognize the claims. The order passed in August 1952 revoking the grants by the Rulers of Sarila and Charkhari was in my view in substance an act of State. It is true that there can be no act of State by a sovereign against his own subjects. But the State was seeking to refuse to recognize the claims made by the grantees from the former Rulers, and the fact that the act of State operated to the prejudice of persons who were at the date of refusal of recognition citizens, did not deprive the act of State of either its character or efficacy. These appeals must therefore be allowed and the suit filed by the respondents dismissed with costs throughout. RAGHUBAR DAYAL J. I agree with the views expressed R, by my learned brother Ayyangar J., on all the points except in regard to the Tharao dated March 12. 1948, being law. I agree with brother Hidayatullah J., that this Tharao is not law, and further agree with him in the order proposed. MUDHOLKAR J. This Bench has been constituted for considering whether the reasoning underlying the decision of this Court in Virendra Singh vs The State of Uttar Pradesh(1) that the inhabitants of the Indian States brought with them, after the merger of those States in the Dominion of India pursuant to agreements entered into by the Rulers of those (1) ; 584 States, rights to property granted to them by the Rulers of those States, is correct or not. The decision and the various grounds upon which it rests have been carefully examined by my brother Ayyangar J., in his judgment and I am generally in agreement with what he has said. As, however, I take a somewhat different view on some of the matters which arise for consideration in this case this judgment has become necessary. The facts have been set out fully in the judgment of my learned brother and, therefore, it will be sufficient to mention only such of them as are necessary to elucidate the questions which I propose to deal with. In consequence of two agreements entered into by the former Ruler of Sant State, the territory of that State merged in the Dominion of India as from June 10, 1948. Prior to that date it had acceded to the Dominion of India on three subjects only. This State, along with other ruling States in India, became an independent sovereign State in the year 1947 when the Dominions of India and Pakistan were constituted. By virtue of the powers vested in the Central Government by the Extra Provincial Jurisdiction Act, 1947 it delegated its functions to the Government of Bombay which passed the Indian States (Application of Laws) Order, 1948 on July 28, 1948. In, consequence of that Order certain laws in force in the Pro vince of Bombay were extended to the merged territories. By the operation of the Indian States (Merger of Governors Provinces) Order, 1949, the Sant State became part of the Province of Bombay. The agreement relating to the merger of the State in the Dominion of India was entered into by the Ruler of Sant some time before the date on which the merger became effective. The Ruler of the State passed a Tharao (which is translated as 'Order) on March 12, 1948 in the following terms: "section Ta. Mu Outward Register No. 371. The Jivak, Patavat, Inami, Chakariyat, Dharmada villages in Sant State are being given (granted) to Jagirdars and the holders of the said villages are not given rights over forests. Hence after considering the complaints of certain Jagirs, they, 585 are being given full rights and authority over the forests in the villages under their vahivat. So, they should manage the vahivat of the forest according to the policy and administration of the State. Orders in this regard to be issued. " Taking advantage of the Tharao several Jagirdars entered into contracts pertaining to the exploitation of the forests in their Jagirs. The respondents in these appeals are some of the forest contractors. The Government of the Province of Bombay through the officers of its Forest Department did not allow the respondents to exercise their rights under the contracts entered into with them by the Jagirdars on the ground that the grant of forest rights by the former Ruler to the Jagirdars was not binding upon the successor Government. Thus being deprived of their right to work the forests the various respondents instituted suits after the coming into force of the Constitution of India. Their claims were opposed by the State of Bombay mainly on the ground that in the absence of recognition, express or implied, by the successor State of rights conferred by the former Ruler on the Jagirdars the respondents could not enforce them in the municipal courts. The suits of the respondents were dismissed by the court of first instance and appeals preferred therefrom by them were dismissed by the District Court. In second appeal, however, the appeals were allowed by the High Court by a common judgment in which reliance is placed largely upon what has been held and said by this Court in Virendra Singh 's case(1) though a reference has also been made to two other decisions of this Court and some decisions of the Privy Council. In the arguments before us it has never been in question that the acquisition of the territory of Sant State by the Dominion of India in pursuance of the Instrument of Accession and Merger Agreement was an act of State. The respondents ' contentions were, however, that (1) in point of fact the Government of Bombay, acting through the officers of the forest department had recognised the Jagirdar 's rights by permitting the contractors to carry on the work of cutting timber; (2) that though the Government of" (1) ; 586 Bombay subsequently repudiated the Jagirdars ' rights that repudiation was of no avail; (3) that the letter sent to the Ruler of Sant State by the Secretary to the States Depart ment, Mr. V. P. Menon, in October, 1948 amounted to a waiver by the Dominion of India of the right of repudiation of the rights of Jagirdars; (4) that after the Jagirdars became the citizens of the Dominion of India there could be no act of State against them; (5) that the doctrine evolved by the Privy Council in its decisions starting from Secretary of State for India vs Kamachee Boye Sahiba(1) and going upto Asrar Ahmed vs Durgah Committee, Ajmer(2) was opposed to the present view on the effect of conquest and cession upon private rights as exemplified in the decisions in United States vs Percheman(3) and that this Court should, therefore, discard the Privy Council 's view and adopt the modem view inasmuch as the latter is considered by common consent to be just and fair and finally (6) that the Jagirdars could not be deprived of the forest rights deprived by them from the Ruler of Sant State before the Constitution, without ,complying with the provisions of section 299 of the Government of India Act, 1935, and after the coming into force of the Constitution without complying with the provisions of article 31 of the Constitution. I agree with my brother Ayyangar J., that the fact that some officers of the forest department had permitted the respondents to carry on operations in the forests leased out to them by the Jagirdars does not amount to recognition of the right conferred upon the latter by the Tharao of March 12, 1948. In the first place, it was not open to the officers of the forest department to grant recognition to the Jagirdars ' rights for the simple reason that the right of granting recognition could be exercised only by the Government acting through its appropriate agency. Moreover the permission which was accorded to the respondents was only tentative and expressly subject to the final decision of the Government on the question of their right under the leases granted by the Jagirdars. (1) ; (2) A 1 R 1947 P. C I. (3) ; 587 The second contention of the respondents is based upon a misapprehension of the legal position flowing from the long series of decisions of the Privy Council which have been accepted by this Court in several of its decisions and in particular Dalmia Dadri, Cement Co. Ltd. vs The Commissioner of Income tax(1); State of Saurashtra vs Memon Haji Ismail (2) ; Promod Chandra Deb and Ors. vs The State of Orissa and Ors.(3); State of Saurashtra vs Jamadar Mahamad Abdulla and Ors.(4). The one decision in which the Privy Council 's view is criticised is that of Virendra Singh 's case(5). The view of the Privy Council has been expressed by Lord Dunedin in Vajesinghji vs Secretary of State for India(6) in the following passage which has been ,quoted with approval in several judgments. "When a territory is acquired by a sovereign State for the first time that is an Act of State. It matters not how the acquisition has been brought about. It may be by conquest, it may be by cession following on treaty, it may be by occupation of territory hitherto unoccupied by a recognised ruler. in all cases the result is the same. , Any inhabitant of the territory can make good in the municipal courts established by the new sovereign only such rights as that sovereign has, through his officers, recognised. Such rights as he had under the rule of predecessors avail him nothing. Nay more, even if in a treaty of cession it is stipulated that certain inhabitants should enjoy certain rights, that does not give a title to, those inhabitants to enforce those stipulations in the municipal courts. The right to enforce, remains only with the high contracting parties. " Thus what is clear beyond doubt is that the rights derived by the inhabitants of the conquered and ceded territory from its former rulers cannot be enforced by them against the new (1) [1959] S.C.R. 729.(2) [19601 1 S.C.R. 537. (3) [1962] Supp. 1. S.C.R. 405.(4) [19621 3 S.C.R. 970. (5) ; 51 T.A. 357. 588 sovereign in the courts of that sovereign unless they have been recognized by the sovereign. The only basis upon which rights of this kind can be enforced in a municipal court would be the fact of its recognition by the new sovereign. A right which cannot on its own strength be enforced against a sovereign in the courts of that sovereign must be deemed to have ceased to exist. It follows therefore that a right which has, ceased to exist does not require repudiation. As regards the argument that the Government has waived its right to withold recognition, I agree with all that has been said by my brother Ayyangar J. Indeed, if the inhabitants of a ceded territory have ceased to have a right against the new sovereign there is nothing for the sovereign to waive. I also agree with my learned brother that if the letter of the Secretary to the States Department wpon which reliance is placed by the respondents is regarded as part of the agreement of merger the municipal courts are precluded by article 363 of the Constitution from enforcing any rights arising thereunder. The argument that there can be no Act of State against its citizens is based upon the supposition that the rights claimed by the Jagirdars from their former Ruler would be available to them against the new sovereign unless they were repudiated and that here, as the resolution of the Government of Bombay dated February 6, 1953 stating that Jagirdars ' rights have already been repudiated amounts to an Act of State against persons who had long before this date become the citizens of the Republic of India it was incompetent. As already pointed out, the municipal courts cannot take notice of a right such as this unless it had been recognized expressly or by implication by the new sovereign. doubt, the Government resolution speaks of repudiation. That in my opinion is only a loose way of conveying that the rights of the Jagirdars have not been recognized. That resolution does no more than set out the final decision of Government not to give recognition to the Tharao of March 12, 1948 by which the former Ruler of Sant State ad conferred certain forest rights on the Jagirdars. Indeed, it is clear from paragraph 3 of that resolution that the Government had expressly borne in mind the legal position 589 that rights claimed under the Tharao gave no title to the inhabitants of Sant State to enforce them in a municipal ,court and that the right to enforce them remained only with the high contracting parties. Now as to the argument that this Court should discard the view taken by the Privy Council in Secretary of State for India vs Kamchee Boye Sahiba(1); Secretary of State for India vs Bai Rajbai(2); Vajesinghji vs Secretary of State for India(3); Secretary of State vs Sardar Rustom Khan(4) and Asrar Ahmed 's case(5) and adopt the view taken by ,Chief Justice Marshall in Percheman 's case(6). I agree with much which my learned brother has said but would,add one thing. It is this. The courts in England have applied the principles of international law upon the view that what is by the common consent of all civilized nations held to be an ,appropriate rule governing international relations must also be deemed to be a part of the common law of England. Thus English courts have given effect to rules of international law by resorting to a process of incorporation(7). The English courts also recognise the principle that since the British Parliament is paramount the rules of international law are subject to the right of Parliament to modify or abrogate any of its rules. A municipal court can only enforce the law in force in the State. Therefore, if a rule of international law is abrogated by Parliament it cannot be enforced by the municipal courts of the State and where it is modified by Parliament it can be enforced by the municipal courts subject to the modification. Would the position be different where a particular rule of international law has been incorporated into the common law by decisions ,of courts? So far as the municipal courts are concerned that would be the law of the land which alone it has the power and the duty to enforce. Where Parliament does not modify or abrogate a rule of international law which has become part of the common law, is it open to a municipal (1) ; 42 I.A. 229. (3) 51 I.A. 357. (4) 68 I.A. 109. (5) ; A.I.R. 1947 P.C. I.(6) (7) See International Law a Text 1962 by Jacobini, p. 32 et seq 590 court to abrogate it or to enforce it in a modified form on the ground that the opinion of civilized States has undergone a change and instead of the old rule a more just and fair rule has been accepted ? Surely the law of a State can only be modified or repealed by a competent legislature of theState and not by international opinion however weighty that Opinion may be. Now, a rule of international law on which the several Privy Council decisions as to the effect of conquest or cession on the private rights of the inhabitants. of the conquered or ceded territory is founded has become a part of the common law of this country. This is 'law in force and is saved by article 372 of the Constitution. The courts in India are, therefore, bound to enforce that rule and not a rule of international law governing the same matter based upon the principle of state succession which had received the approval of Marshall C.J. and which has also received the approval of several text book writers, including Hyde(1). It is true that the International Court of Justice has also stated the law on the point to be the same but that does not alter the position so far as the municipal courts are concerned. If in the light of this our law is regarded as inequitous or a survival of an imperialistic system the remedy lies not with us but with the legislature or with the appropriate Government by granting recognition to the private rights of the inhabitants of a newly acquired territory. Thus while according to one view there is a State succession in so far as private rights are concerned according to the other which we might say is reflected in our laws, it is not so. Two concepts underlie our law : One is that the inhabitants of acquired territories bring with them no rights enforceable against the new sovereign. The other is that the municipal courts have no jurisdiction to enforce any rights claimed by them, even by virtue of the provisions of a treaty or other transaction internationally binding on the new sovereign unless their rights have been recognized (1) See Hyde international Law Vol. 1, 2nd ed. p. 431, and Wesley L. Gould An introduction to International Law pp. 422 427. 591 by the new sovereign. Municipal courts derive, their jurisdiction from the municipal law and not from the laws of nations and a change in the laws of nations brought about by the consent of the nations of the world cannot confer upon a municipal court a jurisdiction which it does .lot enjoy under the municipal law. Apart from that the rule cannot be regarded merely as a device of colonial powers for enriching themselves at the expense of the inhabitants of conquered territories and, therefore, an anachronism. It would neither be just nor reasonable to bind the new sovereign, by duties and obligations in favour of private parties created by the ex sovereign from political motives or for the purpose of robbing the new sovereign of the full fruits of his acquisition. No doubt, International Law does not prevent legislation by the new sovereign for the purpose of freeing itself from Such duties and obligations but that would be a long and laborious process and may be rendered onerous or by reason of constitutional provisions such as those contained in Part III of our Constitution, even impossible. It would also not be reasonable to regard the new sovereign as being bound by duties and obligations created by the ex sovereign till such time as the new sovereign was able to show that they were incurred by the ex sovereign mala fide. It is apparently for such reasons that the law as found by the Privy Council deprives the grantees under the former ruler completely of their rights as against a new sovereign by making those rights unenforceable in a municipal court. It, however, also envisages the recognition of those rights by the new sovereign. This means that the new sovereign is expected to examine all the grants and find out for himself whether any of the grants are vitiated by mala fides or were against his legitimate interests so that he can give recognition to those grants only which were not vitiated by mala fides or which were not against his interests. That this is how the rule was applied would be clear from what happened in this country when time and again territories were ceded by former Indian Rulers to the British Government. As an instance of this there was the Inam Enquiry in the middle of the last century as a result of which a very large number of Inams were ultimately 592 recognised by the British Government. That while dealing with the claims of the former grantees in ceded territories used to be examined meticulously would be clear from the facts in Bai Rajbai 's case(1). Such being the actual posi tion I do not think that the rule which has been applied in this country can be regarded to be anachronism or to be iniquitous In so far as the argument is based on the provisions of s.299 of the Government of India Act, 1935 and article 31 of the Constitution is concerned I would reiterate the view which my brother Sarkar J. and myself have taken in Jamadar Mahamad Abdulla 's case(3) and Promod Chandra Deb 's case(4) which is the same as that expressed by my brother Ayyangar J., and with which my brother Hidayatullah J., has agreed. , Adverting to a similar argument advanced by Mr. Pathak 'in the former case we quoted the following passage from the judgment of Venkatarama Aiyar J., in Dalmia Dadri Cement Co 's case(4): ",It is also well established that in the new set up these residents do not carry with them the rights which they possessed as subjects of the ex sovereign and that as subjects of the new sovereign, they have only such rights as are granted or recognised by him." and a passage from the judgment in Bai Rajbai 's case(5), and then observed : "Any right to property which in its very nature is not legally enforceable was clearly incapable of being protected by that section." (pp. 1001 2). That was a reference to section 299(1) of the Government of India Act, 1935. In the other case we have observed at p. 499: "In our opinion section 299(1) of the Constitution Act of 1935 did not help grantees from the former (1) 42 I.A. 229. (2) (1962] 3 S.C.R. 970. (3) [1962] Supp. 1 S.C.R. 405. (4) [1959] S.C.R. 729. (5) 42 I. A. 229. 593 rulers whose rights had not been recognized by his new sovereign in the matter of establishing their rights in the municipal courts of the new sovereign because that provision only protected such rights as the new citizen had at the moment of his becoming a citizen of the Indian Dominion. It did not enlarge his rights nor did it cure any infirmity in the rights of thecitizen:. . . " The other point raised in these appeals was as to whether the Tharao relied upon by the respondents was a law and, therefore, could be said to have been kept in force by the provisions of the Application of Laws Order, 1949 made by the Province of Bombay. My brother Ayyangar J., has largely on the basis of the decision of this Court in Madhorao Phalke vs The State of Madhya Pradesh (1) held that it is law. On the other hand my brother Hidayatullah J., has come to the opposite conclusion. My brother Shah J., has also held that the Tharao is not a law. I agreed with the view taken by my brother Hidayatullah J., and brother Shah J., that it is not a law and that the decision in Madhorao Phalke 's case(1) does not justify the conclusion that it is 'law '. I do not think it necessary for the purpose of this case to examine further the question as to what are the indicia of a law. For these reasons I would allow the appeals with costs throughout. ORDER SINHA C.J. In accordance with the opinion of the majority the appeals are allowed with costs throughout one set of hearing fees. (1) ; 134 154 S.C. 38.

The Ruler of the State of Sant had issued a Tharao dated 12th March 1948, granting full right and authority to the jagirdars over the forests in their respective villages. Pursuant to the agreement dated March 19, 1948, the State of Sant merged with the Dominion of India. On October 1, 1948, Shree V. P. Menon, Secretary to the Government of India, wrote a letter to the Maharana of Sant State expressly declaring that no order passed or action taken by the Maharana before the day of April 1st 1948, would be questioned. After merger there was obstruction by the forest officers when the respondents were cutting the forests, but after some correspondence they were permitted to cut the trees on furnishing an undertaking that they would abide by the decision of the government. The Government of Bombay, after considering the implications of the Tharao, decided that the order was mala fide and cancelled it on 8th July 1949 In the meantime these respondents were stopped from working the forests by the Government of Bombay. 462 Thereupon these respondents filed suits for declaration of rights in the forests and for a permanent injunction against interference with those rights by the State. The respondents claimed in these suits that the rights of the grantees to the forests were not liable to be cancelled by the Dominion of India after the merger of the State of Sant in June, 1948, by executive action, and that the Government of Bombay was not competent to obstruct them in the exercise of those rights. Their claims were opposed by the State of Bombay mainly on the ground that in the absence of recognition, express or implied, by the successor State of the rights conferred by the former ruler on the jagirdars the respondents could not enforce them in the Municipal Courts. These respondents filed five suits against the State of Gujarat. All suits except one were dismissed by the Trial Court. The District Judge on appeal ordered the dismissal of that suit also and dismissed the appeals of the plaintiffs in the other suits. The plaintiffs then appealed to the High Court and the High Court allowed all appeals and the suits were decreed. ' The High Court held on the basis of the letter written by Shri V. P. Menon, Secretary that the succeeding sovereign had waived or relinquished its right to repudiate the Tharao. The High Court further held that the Tharao was not a legislative action of the Ruler of Sant State. The State Government appealed to this Court by special leave. Hence the appeal. Per majority: Hidayatullah J. (i) The Act of State comes to an end only when the new sovereign recognises either expressly or impliedly the rights of the aliens. It does not come to an end by an action of subordinate officers who have no authority to bind the new sovereign. Till recognition, either express or implied, is granted by the new sovereign, the Act of the State continues. In the present case, the Act of State could only come to an end if Government recognised the rights flowing from Tharao. That Government never did. There was thus no recognition of the Tharao or the rights flowing from it at any time. In the present case, the subordinate officers of the Forest Department allowed each respondent to cut the trees on furnishing an undertaking that he would abide by the decision of the Government and so the question of waiver or relinquishment does not arise. Secretary of State in Council for India vs Kamachee Boye Sahaba, ; , Secretary of State vs Sardar Rustom Khan and Others, (68) I. A. 109, MIS. Dalmia Dadri Cement Co. Ltd. vs Commissioner of Income tax, [1959] S.C.R. 729, The State of Saurashtra vs Memon Haji Ismale Haji, ; , Jagan Nath Agarwala vs State of Orissa, ; , State of Saurashtra V. Jamadar Mohamed Abdulla and Ors., and Vaje Singhji Jorwar Singh vs Secretary of State for India, (1924) L.R. 51 I.A. 357, relied on. Virendra Singh and Ors. vs The State of Uttar Pradesh ; , disapproved. Bhola Nath vs State of Saurashtra, A.I.R. 1954 S.C. 680, Bhojrajji vs The State of Saurashtra, , referred to. 463 (ii) The Act of State did not come to an end by virtue of Article 299(1) of Government of India Act, 1935 and so the respondents could not claim the protection of that section. Section 299(1) did not come into play because it could only come into play after the rights were recognised. In the present case the rights were never recognised by the Government. (iii) The original Act of State continued even after January 26, 1950, because there was no state succession on January 26, 1950 in so far as the people of Sant State were concerned. For them state succession was over some time in 1948. The Act of State which began in ' 1948 could continue uninterrupted even beyond 1950 and it did not lapse or get replaced by another Act of State. These rights in question cannot be protected under the Constitution because these rights were not recognised even before 1950. (iv) That the impugned Tharao was not a law as it did not lay down any rule of conduct. It was a grant made to the Jagirdars mentioned in the Tharao. The fact that Maharana 's Tharao was passed to benefit a larger number of persons en bloc does not make it any the more a law if it did not possess any of the indicia of a law. The Tharao did give rights to the grantees but did not lay down any rule of conduct. It is a grant and as a grant it was open to the new sovereign not to recognise it. Madhorao Phalke vs The State of Madhya Bharat, ; , distinguished. Ameer unnissa Begum and Ors. vs Mahboob Begum and Ors. A.I.R. 1955 S.C. 352. distinguished. Maharaja Shri Umaid Mills Ltd. vs Union of India and Others. ; and The Bengal Nagpur Cotton Mill Ltd. vs The Board of Revenue, Madhya Pradesh and Others, A.I.R. relied on. (v) The right claimed here is not even a concessionary right such as has received the support of the International writers. It is more of the nature of a gift by the Ruler at the expense of the State. It lacks bona fides which is one of the things to look for. There is no treaty involved and whatever guarantee there is, article 363 of the Constitution precludes the Municipal Courts from considering. This distinguishes the jurisdiction and power of the Supreme Court of the United States in which consideration of treaties is included. In the United States the Constitution declares a treaty to be the law of the land. In India the position is different. Article 253 enables legislation to be made to implement international treaties. This Court has accepted the principles laid down by the Courts in England in regard to the limits of the jurisdiction of Municipal Courts. The view of the Supreme Court of United States or the view taken in international law has not been accepted by this Court. Politically and 464 ethically there might have been some reason to accept and respect such concessions but neither is a reason for the Municipal Courts to intervene. The Rule that the Act of the State can be questioned in a Municipal Court has never been adopted and it has been considered that it is a matter for the political departments of the State. However desirable it may be that solemn guarantees should be respected, this Court should not impose its will upon the State, because this is outside its jurisdiction. In this case, the present respondents who were not parties to the merger agreement or to the letter written by Mr. Menon which was made expressly a part of the Agreement cannot take advantage of cl. 7. If they were parties, Article 363 would bar such plea. Maharaj Umeg Singh and Others vs The State of Bombay and Others. ; , relied on. U.S. vs Percheman, ; at 86, disapproved: Shapleigh vs Miar, ; , referred to. Salaman vs Secretary of State for India, , referred to. Cook vs Sprigg. , referred to. Foster vs Nielson. ; , referred to. Birma vs The State, A.I.R. to 7, referred to. Amodutijani vs Secretary Southern Nigeria, [1921] 2 A.C. 399, referred to. Clark V. Allen, ; referred to. West Rand Central Gold Minning Co. vs Regem, [1905] 2 K.B. 391, referred to. Secretary of State vs Bai Raj Bai, (1915) L.R. 42 I.A. 229, relied on. Per Shah J. (1) The rule that cession of territory by one State to another is an act of State and the subjects of the former State may enforce only those rights in Municipal Courts which the new sovereign recognises has been accepted by this Court. M/s. Dalmia Dadri Cement Co., Ltd. V. Commissioner of incomeTax, [1959] S.C.R. 729, jagannath Agarwala vs State of Orissa, ; , Promod Chandra Dev vs State of Orissa, [1962] Suppl. 1 S.C.R. 405 and the State of Saurashtra vs Jamadar mohd. Abdullah, , relied on. The Secretary of State In Council of India vs Kamachee Boye Sahaba, 7 Moore 's I.A. 476, Vajesinghji Joravarsinghji vs Secretary of State for India in Council, L.R. 51 I.A. 357 and Secretary of State vs Sardar Rustam Khan and Others, L.R. 68 I.A. 109, relied on. 465 (ii) The Constitutional provisions in the United States are somewhat different. Under the Constitution of the United States each treaty becomes a part of the law of the land; the provisions thereof are justiciable and the covenants enforceable by the Courts. In India the treaties have not the force of law and do not give rise to rights or obligations enforceable by the Municipal Courts. In the present case by virtue of article 363 of the Constitution, it is not open to the respondents to enforce the covenants of the agreement as stated in the letter of guarantee written by Mr. V. P. Menon in the Municipal Courts. United States vs Parcheman, ; at 86, 87, not relied on. Cook vs Sprigg. , referred to. Maharaj Umeg Singh and Others vs The State of Bombay and Others, ; , relied on. (iii) An act of State may be spread over a period and does not arise merely an the point of acquisition of sovereign right. Nor is the new sovereign required to announce his decision when he assumes or accepts sovereignty over foreign territory, about the rights created by the quondam sovereign, on pain of being held bound by the right so created. There. fore till the right to property of the subjects of the former Indian State was recognized by the new sovereign there was no title capable of being enforced in the courts of the Dominion or the Union. (iv) The functions of a State whether it contains a democratic set up or is administered by an autocratic sovereign fall into three broad categories executive, legislative and judicial. The line of demarcation of these functions in an absolute or autocratic form of government may be thin and may in certain cases not easily discernible. But on that account it is not possible to infer that every act of an autocratic sovereign has a legislative content or that every direction made by him must be regarded as law. The legislative power is the power to make, alter, amend or repeal laws and within certain definite limits to delegate that power. Therefore It is power to lay down a binding rule of conduct. Executive power is the power to execute and enforce the laws, and judicial power is the power to ascertain, construe. and determine the rights and obligations of the parties before a tribunal. In the present case the order dated March 12, 1948, is expressly in the form of a grant of the rights which were not previously granted and does not either expressly or by implication seek to lay down any binding rule of conduct. The impugned order was not a law or an order made under any law within the meaning of cl. 4 of the Administration of the Indian States Order of 1948. Promod Chandra Deb and Others vs The State of Orisa and Others, (1962] Suppl. 1 S.C.R. 405, Ameer un Nissa Begum and Others vs Mahboob Begwn and Others, A.I.R. (1955) S.C. 352, Director of Endow 134 159 S.C. 30. 466 ments, Government of Hyderabad vs Akram Ali, A.I.R. (1956) S.C. 60, Tilkayat Shri Govindlalji Maharaj etc. vs State of Rajasthan and Others, A.I.R. (1963) S.C. 1638, distinguished, discussed. Madhorao Phalke vs The State of Madhya Bharat, ; discussed. Maharaja Shree Umaid Mills Ltd. vs Union of India, A.I.R. , relied on. The Bengal Nagpur Cotton Mills Ltd. vs The Board of Revenue, Madhya Pradesh and Others, C.A. No. 416 of 1961 decided on July 30, 1963, relied on. (v) To attract section 299(1) of the Government of India Act, 1935, there must, exist a right to property which is sought to be protected. The subjects of the acceding State are entitled only to such rights as the new sovereign chooses to recognize, in the absence of the any recognition of the rights of the respondents or their predecessor Jagirdars, there was no right to property of which protection could be claimed. On the Sam* reasoning, grantees of the Ruler could not claim protection under Art 31(1) of the Constitution. Per Mudholkar J. (i) The rule of international law on which the several Privy Council decisions as to the effect of conquest or cession on the private rights of the inhabitants of the conquered or coded territory are founded has become a part of the common law of this country. This being a "law in force" and at the commencement of the Constitution is saved by article 372 of the Constitution. The Courts in India are, therefore, bound to en. force that rule and not what according to Marshall C.J. is the rule at. International Law governing the same matter, though the latter has also, received the approval of several text book writers. The rule which has. been applied in this country is not inequitor nor can it be regarded to be an anachronism. Virendra Singh vs The State of Uttar Pradesh, [1955] S.C.R. 415 United State vs Percheman, ; disapproved. Secretary of State for India vs Kamachee Boye Sahiba, (1859) is Moore P. C. 22, Asrar Ahmed vs Durgah Committee, Ajmer, A.I.R. 1947 P.C. 1, Dalmia Dadri Cement Co. Ltd. vs The Commissioner of Incometax, [1959] S.C.R. 729, State of Saurashtra vs Memon Haji Ismail ; , State of Saurashtra vs Jamadar Mohamed Abdullah and Ors., (1962] 3 S.C.R. 970, Vajesinghji vs Secretary of State for India,, 51 I.A. 357 and Secretary of State for India vs Bai Rajbai, 42 I.A. 229 Promod Chandra Dev vs State of Orissa and Ors. [1962] Supp. 1 S.C.R. 405, relied on (ii) Two concepts underlie our law. One is that the inhabitants of acquired territories bring with them no rights enforceable against the new sovereign. The other is that the Municipal Courts have no jurisdiction to enforce any rights claimed by them, against the sovereign despite the provisions of a treaty unless their rights have been recognised by the 467 new sovereign after cession or conquest. In other words a right which cannot on its own strength be enforced against a sovereign in the Courts of that sovereign must be deemed to have ceased to exist. It follows therefore that a right which has ceased to exist does not, require repudiation. Municipal courts derive their jurisdiction from the Municipal law and not from the laws of nations and a change in the laws of nations brought about by the consent of the nations of the world cannot confer upon a Municipal Court a jurisdiction which it does not enjoy under the Municipal law. (iii) The grantees of the Ruler could not claim the protection of s 299 of Government of India Act, 1935 or of article 31 of the Constitution of India as they possessed no right to property enforceable against the new sovereign. (iv) The impugned Tharao was not law. Madhorao Phalke vs The State of Madhya Pradesh ; , referred to. Per minority Sinha C.J. and Ayyangar J. (i) The juristic basis of the theory underlying the Privy Council decisions is that with the extinction of the previous sovereign the rights theretofore exerciseable by the subjects of that sovereign by virtue of grants for that sovereign were likewise extinguished and that without recognition which is really tantamount to a fresh grant by the new sovereign, no title enforceable in the municipal courts of the succeeding sovereign came into being. The doctrine of Act of State evolved by English courts is one purely of municipal law. It denies to such a court jurisdiction to enquire into the consequences of acts which are inseparable from an extension of its sovereignty. That doctrine was, however. not intended to deny any rule of International Law. The British practice that has prevailed in this country has not proved in actual practice to lead to injustice, but has proceeded on a just balance between the acquired rights of the Private individual and the economic interests of the community, and therefore there is nothing in it so out of tune with notions of propriety or justice to call for its rejection. Even in the case of Virendra Singh this Court did not express any decisive opinion in favour of accepting the observations in Percheman 's case as proper to be applied by the municipal courts in India. This Court has in subsequent decisions followed the Privy Council decisions. The view of the Supreme Court of the United States has not been accepted by this Court for the reason that the Constitutional position in regard to the recognition of treaties in both countries are different. In the United States a treaty has the force of law, which is not the position here. Besides, in India by virtue of Article 363 of the Constitution, Municipal Courts are deprived of jurisdiction to enforce any rights arising from treaties. 468 Vinrendra Singh vs The State of Uttar Pradesh, ; , disapproved. Vajesinghji vs Secretary of State for India, 51 I.A. 357, Cook vs Sprigg, , relied on. walker vs Baird, , Johnstone vs Pedlar, ; , referred to. United States vs Percheman, ; , disapproved. M/s, Dalmia Dadri Cement Co. Ltd. vs The Commissioner of Incometax, [1959] S.C.R. 729, Jagan Nath Agarwala vs The State of Orissa, ; , Promodh Chandra Dev vs The State of Orissa, [1962] 1 Supp. S.C.R. 405, The State of Saurarhtra vs Jamadar Mohamad Abdulla, [1962] 3 S.C.R. 970, Secretary of State for India vs Kanzachee Boye Sahiba [1859] 7 Moore, I.A. 476, Secretary of State for India in Council vs Bai Rai Bat, 42 I.A. 229 and Secretary of State vs Rustom Khan, 68 IA. relied on. Amodu Tijani vs Secretary Southern Nigeria, [1921] 2 A.C. 399, referred to. West Rand Central Gold Mining Co., vs Rex, [1905] 2 K.B. 391. referred to. Asrar Ahmed vs Durgha Committee, Ajmer, A.I.R. 1947 P.C. 1, relied on Attorney General of Canada vs Attorney General of Ontario, , referred to. (ii) Where the new sovereign assumes jurisdiction and it does some act and there is ambiguity as to whether the same amounts to a recognition of a pre existing right or not, the covenant and the treaty right be looked at in order to ascertain the intention and purpose of that equivocal act, but beyond This the covenant and the treaty cannot by them selves be used either as a recognition pure and simple or, as waiver of a right to repudiate the pre excisting rights. It is needless to point out that since the enforceability of the rights against the succeeding sovereign springs into existence only on recognition by the sovereign, there La no, question of a waiver or the right to repudiate. In the present case the High Court erred in holding on the basis of cl. 7 of the letter of Shri V. P. Menon that the Government waived their right to repudiate the grant made by the previous ruler. Bhola Nath vs The State of Saurashtra, A.I.R. (1954) S.C. 680. distinguished 469 (iii) Just previous to the Constitution the grantee had no right of property enforceable against the State. The coming into force of the Constitution could not, therefore, make any difference, for the Constitution, did,not create rights in property but only protected rights which otherwise existed. (iv) In the present case the "Tharao" was not a grant to any individual but to the holders of 5 specified tenures in the State. The 'Tharao ' is more consistent with its being a law effecting an alteration in the tenures of the 5 classes of Jagirdars by expanding the range of the beneficial enjoyment to the forests lying within the boundaries of the villages which had already been granted to them. In this light, the 'Tharao ' would not 'be administrative order in any sense but would partake of the character of legislation by which an alteration was effected in the scope and content of tenures referred to. The "Tharao" dated March 12, 1918 satisfies the requirement of "a law" within article 366(10) of the Constitution and in consequence, the executive orders of the Government of Bombay by which the forests right% of the plaintiffs were sought to be denied were illegal and void. The "Tharao" was in truth and substance a law which was continued by article 372 of !he Constitution and therefore it could be revoked by the appellant by legislative authority and not by an executive act. Madhorao Phalke vs The State Madhya Bharat ; , Ameer un nissa Begum vs Mahboob Begum, A.I.R. 1955 Sup 4 Court, 352 and Director of Endowments, Government of Hyderabad Akram Ali, A.I.R. 1956 S.C. 60, relied on. Per Subha Rao J. (i) The decision in Virendra Singh 's case is not only correct, but. is also in accord with the progressive trend of modern international law. It may, therefore, be stated without contradiction that in none of the decisions of this Court that were given subsequent to Vires. dra Singh 's ease the correctness of that decision was doubted. After all, an act of State is an arbitrary act not based on law, but on the modern version of 'Might is right '. It is an act outside the law. There were two different lines of approach. One adopted by the imperialistic nations and the other by others who were not. That divergence was reflected in English and American Courts. All the jurists of International law recognise the continuity of title to immovable property of the erstwhile citizens of the ceding state after the sovereignty changed over to the absorbing state. It may, therefore, be held that so far as title to immovable property is concerned the doctrine of International law has become crystallized and thereunder the change of sovereignty does not affect the title of the erstwhile citizens of the ceding state to their property. In America the said principle of International Law has been accepted without any qualification. M/S. Dalmia Dadri Cement Co. Ltd. V. The Commissioner of Income tax, [1959] S.C.R. 729, Jagannath Agarwala vs The State of Orissa, ; , Promodh Chandra Dev. vs The State of Orrissa 470 [1962] Supp. 1 S.C.R. 405, State of Saurashtra vs Jamadar Mohmed Abdulla, , discussed and distinguished. United States vs Percheman, ; , relied on. Foster vs Neilson, ; , The American Insurance Co. and the Ocean Insurance Co. vs Bales of Cotton , Charles Dehault vs United States, (1835) 9 Ed. 117, Vajeenngli Joravarsingji vs Secretary of State for India in Council, (1951) I.A. 357, referred to. (ii) The law in England is that the municipal courts cannot enforce the acquired rights of the erstwhile citizens of the ceding state against the absorbing state unless the said state has recognized or acknowledged their title. This Court accepted the English doctrine of Act of State in a series of decisions. The word "recognize" means "to admit, to acknowledge, something existing before". By recognition the absorbing state does not create or confer a new title, but only confirms a pre existing one. Non recognition by the absorbing does not divest the title, but only makes it unenforceable against the state in municipal courts. Pramod Chandra Dev. vs The State of Orissa, [1962] Supp. 1 S.C.R. 503, relied on. (iii) The doctrine of acquired rights, at any rate in regard to immovable property has become crystallized in International Law. Under the said law the title of a citizen of a ceding state is preserved and not lost by cession. The change of sovereignty does not affect his title. The municipal laws of different countries vary in the matter of its enforceability against the state. As the title exists, it must be held that even in those countries, which accepted the doctrine of act of State and the right of a sovereign to repudiate the title, the title is good against all except the State. Before the Constitution came into force the State did Dot repudiate the title. When the Constitution of India came into force the respondent and persons similarly situated who had title to immovable pro perty in the Sant State had a title to the said property and were in actual possession thereof. They had title to the property except against the State and they had, at any rate, possessory title therein. The Constitution in Article 31(1) declares that no person shall be deprived of his property save by authority of law. That is, the Constitution recognised the title of the citizens of erstwhile State of Sant, and issued an injunction against the sovereign created by it not to interfere with that right except in accordance with law. A recognition by the Supreme Law of the land must be in a higher position than that of an executive authority of a conquering State. It was held that the title to immovable property of the respondent was recognised by the Constitution itself and, therefore, necessarily by the sovereign which Is bound by it. 471 In the present case the letter written by the Government of India dated 'October 1, 1948, clearly recognized the title of the respondents to their properties. The letter clearly contains a statement in paragraphs 5 and 7 thereof that enjoyment of Jagirs, grants etc. , existing on April 1, 1948, were guaranteed and that any order passed or action taken by the Ruler before the said date would not be questioned. This is a clear recognition of the property rights of the respondent and similar others. Virendra Singh vs The State of Uttar Pradesh, ; , relied on. M/S. Dalmia Dadri Cement Co. Ltd. vs The Commissioner of Incometax [1959], S.C.R. 729, Jagan Nath Agarwala vs The State of Orissa ; , Promodh Chandra Dev vs The State of Orissa ' [1962], Supp. 1 S.C.R. 405 and State of Saurashtra vs Jamadar Mohamed Abdullah , discussed and distinguished.

Civil Appeal No. 1592 of 1969. Appeal by Special Leave from the Judgment and Order dated 12th March, 1969 of the Madras High Court in Civil Rev. Petition No. 1791/67. K. Jayaram and K. Ramkumar for the Appellant. A. V. Rangam for the Respondent. The Judgment of the Court was delivered by VENKATARAMIAH, J. This appeal by special leave is filed against the order dated March 12, 1969 passed in Civil Revision Petition No. 1791 of 1967 on the file of the High Court of Madras. 398 On the date of the commencement of the Tamil Nadu Land Reforms (Fixation of Ceiling of Land) Act, 1961 (hereinafter referred to as 'the Act ') i.e. April 6, 1960, the appellant owned approximately 47 acres of agricultural lands. He was required to file a statement under section 8 of the Act within 90 days from the date specified in the Notification issued by the Government in that behalf in respect of all lands held or deemed to have been held by him furnishing the particulars mentioned in that provision to the Authorised Officer within whose jurisdiction his holding or major part thereof was situated. Accordingly, he filed his return. In the course of the enquiry, the Authorised Officer found that under a will made by Sivagami Achi, the mother of the appellant, who died on April 20, 1962, the appellant became entitled to 4.99 standard acres and his wife, Devika got 8.81 standard acres of agricultural land. The Authorised Officer after ascertaining the true extents of the several bits of agricultural land held by the appellant on April 6, 1960, exempted 2.21 acres of land under section 73 of the Act and determined the extent of surplus land which had to be surrendered by the appellant under the Act at 12.803 standard acres on the basis that the appellant 's family which included his wife was holding 44 46 acres as also the land which the appellant and his wife got under the will of Sivagami Achi. On the above basis, he directed the final statement to be published under section 12 of the Act. Aggrieved by the order of the Authorised Officer, the appellant filed an appeal before the Land Tribunal i.e. the Subordinate Judge of Thanjavur under section 78 of the Act contending inter alia that the extent of 8.81 standard acres which had been bequeathed in favour of his wife, Devika by his mother Sivagami Achi under the will referred to above was stridhana land and had to be dealt with accordingly as required by section 5 (4) (a) of the Act. The learned Subordinate Judge accepted the case of the appellant that the extent of 8.81 standard acres acquired by Devika on the death of Sivagami Achi should be allowed to be retained by her in addition to 30 standard acres. The case was, however, remitted back to the Authorised Officer for making a fresh determination of the surplus extent of land in accordance with the order passed in appeal. The State of Tamil Nadu filed a revision petition under section 83 of the Act before the High Court against the appellate order. The High Court allowed the revision petition holding that the extent of 8.81 standard acres acquired by Devika was not 'stridhana land ' as defined under section 3 (42) of the Act and could not be treated as such while determining the surplus land. The High Court further held that the land acquired by Devika was governed by section 21(1) read with section 10(2) (b) of the Act. This appeal is filed against the said order. 399 In order to appreciate the submissions made on behalf of the parties before us, it is necessary to refer briefly to some of the provisions of the Act. The Act was passed to provide for the fixation of ceiling on agricultural land holdings and for certain other matters connected therewith in the State of Tamil Nadu. Having regard to the limited extent of the area of agricultural land available for cultivation in that State, the great disparity in the ownership of agricultural land leading to the concentration of such land in the hands of certain persons, the need for reduction of such disparity in the ownership of agricultural land in that State and the necessity for fixing a ceiling on the Agricultural land holdings, provisions were enacted in the Act fixing a ceiling on the agricultural land holdings and providing for acquisition of agricultural land in excess of the ceiling area and distribution of such land amongst the landless and other persons among the rural population. Section 3(11) of the Act defined the expression "date of the commencement of this Act" as the date on which the Tamil Nadu Land Reforms (Fixation of Ceiling on Land) Bill, 1960 was published in the Fort St. George Gazette, namely, the 6th day of April, 1960. Section 3(34) of the Act defined the expression "person" as including any trust, company, family, firm, society or association of individuals, whether incorporated or not. Under section 3(14) of the Act, 'family ' in relation to a person meant the person, the wife or husband as the case may be, of such person and his or her minor sons and unmarried daughters and minor grandsons and unmarried grand daughters in the male line, whose father and mother were dead. Section 3(7) of the Act defined "ceiling area" as the extent of land which a person was entitled to hold under section 5. Section 3(42) of the Act defined "stridhana land" as any land held on the date of the commencement of the Act by any female member of a female in her own name. During the period in question, the relevant part of section 5 of the Act read as follows: "5. (1)(a) Subject to the provisions of Chapter VIII, the ceiling area in the case of every person and, subject to the provisions of sub sections (4) and (5) and of Chapter VIII the ceiling area in the case of every family consisting of not more than five members, shall be 30 standard acres. . 400 (4)(a) Subject to the provisions of sub section (5), where the stridhana land held by any female member of a family together with the other land held by all the members of that family, is in excess of 30 standard acres, the female member concerned may hold, in addition to the extent of land which the family is entitled to hold under sub section (1), stridhana land not exceeding 10 standard acres. . " Section 7 of the Act read as follows: "7. On and from the date of the commencement of this Act, no person shall, except as otherwise provided in this Act, but subject to the provisions of Chapter VIII, be entitled to hold land in excess of the ceiling area: Provided that in calculating the total extent of land held by any person, any extent in excess of the ceiling area and not exceeding half an acre in the case of wet land and one acre in the case of dry land shall, irrespective of the assessment of such land, be excluded. " Section 21 of the Act read as follows: "21. Ceiling on future acquisition by inheritance, bequest or by sale in execution of decrees, etc. (1) If, on or after the date of the commencement of this Act (a) any person acquires by inheritance or bequest from any person; . . . . . any land, which, together with the land, if any, already held by him, exceeds in the aggregate the ceiling area, then he shall, within ninety days from the notified date or from the date of such acquisition, whichever is later, furnish to the authorised Officer within whose jurisdiction his holding or the major part thereof is situated, a return containing the following particulars, namely . . . " The lands which were bequeathed by Sivagami Achi, the mother of the appellant under a will were held by her on the date of the commencement of the Act i.e. April 6, 1960. The appellant married Devika on June 29, 1960. Sivagami Achi died on April 20, 1962 and on her death, the appellant and Devika became entitled to the land bequeathed in their favour by her. The draft statement relating to the holding of the appellant was published on May, 30, 1965 and the Authorised Officer passed his order on March 14, 1966 treating the lands bequeathed by Sivagami Achi in favour of the appellant and his 401 wife as part of the holding of the family consisting of the appellant and his wife. The case of the appellant before the Authorised Officer, the Subordinate Judge and the High Court was that in view of section 5 (4) (a) of the Act, the ceiling area should have been fixed in his case at 30 standard acres plus the extent of land bequeathed in favour of his wife i.e. 8.81 standard acres. In this Court also, the very same contention is urged. We are of the view that there is no substance in this contention. The expression "stridhana land" used in section 5(4) (a) has been given a restricted meaning by section 3(42) of the Act which defines it as any land held on the date of the commencement of the Act by any female member of a family in her own name. Admittedly on the date of the commencement of the Act i.e. April 6, 1960, Devika was not the owner of the land in question. She acquired title to it only on April 20, 1962 on the death of the testatrix. The appellant cannot, therefore, claim any benefit under section 5(4) (a) of the Act. Section 21 of the Act under which the land in question becomes liable to be included in the holding of the appellant for purposes of determination of the surplus land does not make any difference between stridhana property of a female acquired after the commencement of the Act by inheritance or bequest from any person and any other property held by her family. From a reading of the definition of the expression "stridhana land" in section 3(42) of the Act and the provisions of section 5(4) of the Act, we are of opinion that the State Legislature intended to extend the concession available under section 5(4) of the Act only to the stridhana property held by a female on the date of the commencement of the Act and not to property acquired by her thereafter. It was urged by Mr. K. Jayaram, learned counsel for the appellant that the Act was an expropriatory one and therefore, we should construe section 5 (4) (a) of the Act as being applicable to agricultural land acquired by a female even after the commencement of the Act. We do not think that there is any room for construing the said provision in that way. The object of the legislation as mentioned earlier was to acquire agricultural land in excess of the ceiling area from the holders thereof and to distribute the same amongst the landless among the rural population. If the construction urged by the appellant is placed on section 21 of the Act, the very object of the statute would be defeated. If really the Legislature intended that lands acquired by way of inheritance or bequest by a female on or after the commencement of the Act should also be dealt with in accordance with section 5(4), it would have defined the expression "stridhana land" without the words "on the date of the commencement of this Act. " It has also to be 402 borne in mind that the expression 'stridhana ' is not used in the Act in the sense in which it is used in Hindu Law. The Act is applicable to Hindus as well as others governed by other personal laws. It is, therefore, reasonable to construe the expression 'stridhana land ' as referring only to the land held by a female on the date of the commencement of the Act and not to lands inherited by her or acquired by her as a bequest at any subsequent point of time. The learned counsel for the appellant relied on the decision of the High Court of Madras in Valliammal vs The Authorised Officer, Land Reforms, Coimbatore in which a contention similar to the one urged before us on behalf of the appellant in this case had been accepted. The facts of that case were more or less similar to the facts in the case before us. The petitioner in that case was the wife of one Palanisami Gounder who was in possession of an extent of 44.061 standard acres, after excluding the exempted lands, on the commencement of the Act. She inherited 11.075 standard acres on the death of her son on March 25, 1962. In the return filed by him, the husband of the petitioner claimed that he was entitled to retain 30 standard acres as holding of the family and that his wife, the petitioner in that case, was entitled to hold 10 standard acres as stridhana property. The Land Tribunal, Coimbatore held that since the Act defined "stridhana land" as meaning any land held on the date of the commencement of the Act by any female member of the family in her own name and since the petitioner therein had inherited the land on the death of her son only on March 25, 1962 i.e. subsequent to the commencement of the Act, she was not entitled to retain any land as stridhana property in addition to the extent of land which the family could retain under section 5(1). The petitioner questioned the correctness of the order of the Tribunal before the High Court of Madras in C.R.P. No. 916 of 1971. That petition was dismissed by Ganesan, J. on the ground that in view of the definition of stridhana land in section 3 (42) of the Act, the petitioner therein was not entitled to hold 10 standard acres as stridhana property, in addition to the 30 standard acres allowed to the family consisting of herself and her husband. Thereafter a petition was filed before the High Court by the petitioner therein to review the order passed by Ganesan, J. The review petition came up for decision before another learned Judge who allowed the same by his order dated November 2, 1972. It is on the decision rendered on the review petition the reliance is placed by the appellant before us. In paragraph 6 of that decision, it is observed as follows: 403 "The learned Judge, who heard the civil revision petition, mainly relied on the definition of 'stridhana property ' for holding that no woman is entitled to hold any stridhana property if the same was acquired or inherited subsequent to the commencement of the Act. Of course, section 3(42) defines stridhana land as meaning any land held on the date of commencement of the Act by any female member of a family in her own name. But that meaning is to be adopted 'unless the context otherwise requires '. It has been repeatedly held that the word in the section will have to be interpreted and understood in the context in which it is used in the section and the definition given for that word in the definition section of the Act could not always govern the interpretation without reference to the context. In the context of sections 5, 7 and 21 and with reference to the scope and object of the Act, I am of opinion, that the properties inherited by females as stridhana property subsequent to the commencement of the Act are also entitled to the benefit of sub section (4) of section 5 of the Act. " It is true that the above passage supports the case of the appellant but we are of the view that in the context of section 21 of the Act it is not necessary to give a meaning to the expression 'stridhana land ' different from what is stated in section 3(42) of the Act. For the reasons already stated by us we hold that the aforesaid decision does not lay down the law correctly. It is also to be observed that the earlier decision of the High Court of Madras which is now under appeal does not appear to have been brought to the notice of the learned Judge who decided the above case. We, therefore, hold that the High Court was right in this case in holding that section 5 (4) of the Act was not applicable to the land in question. It was lastly urged by Mr. K. Jayaram that in view of certain subsequent amendments made to the Act, the case has to be examined afresh by us in the light of the amended law. We do not think that it is advisable to do so at this stage. It is open to the appellant if he is so advised to resort to appropriate proceedings in order to claim the benefit that he may be entitled to under the amended law. Liberty is also reserved to the State Government to take whatever action it may take under the subsequent amendments to the Act. In the result, this appeal fails and is dismissed with costs. N.V.K. Appeal dismissed.

The Tamilnadu Land Reforms (Fixation of Ceiling on Land) Act, 1961 by section 3 (42) defined "stridhana land" as any land held on the date of the commencement of the Act (April 6, 1960) by any female member of a family in her own name, and section 5 (4)(a) of the Act enabled such a female member to hold, in addition to the extent of land which the family is entitled to hold, stridhana land not exceeding 10 standard acres. The mother of the appellant had bequeathed to the appellant and his wife certain agricultural lands by a will. The appellant being married on June 29, 1960 and his mother having died on April 20, 1962 i.e. after the Act came into force, the Authorised Officer passed orders treating the lands bequeathed in favour of the appellant 's wife as part of the holdings of the family consisting of the appellant and his wife, and determined the extent of the surplus land to be surrendered. The appellant 's contention in his appeal under section 78 of the Act before the Land Tribunal, that the land which was bequeathed in favour of his wife by his mother under the will was stridhana land, was accepted by it and the Land Tribunal allowed the wife of the appellant to retain the land as stridhana land under section 5 (4)(a) of the Act and remitted back the case to the Authorised Officer for making a fresh determination of the surplus extent of the land. The respondent 's revision petition under section 83 of the Act was allowed, the High Court holding that the land held by the wife was not 'stridhana land ' as defined under section 3 (42) of the Act, and could not be treated as such while determining the surplus land. On the question whether the land in question was 'stridhana land ' and could be treated as such under section 5 (4) of the Act while determining the surplus land. ^ HELD: (1) The High Court was right in holding that section 5 (4) of the Act was not applicable to the land in question. [403 F] (2) The expression "stridhana land" used in section 5 (4) (a) has been given a restricted meaning by section 3 (42) of the Act which defines it as any land held on the date of the commencement of the Act by any female member of a family in her own name. [401C] 397 In the instant case on the date of the commencement of the Act i.e. April 6, 1960 the wife was not the owner of the land in question. She acquired title to it on April 20, 1962 on the death of the testatrix her mother. The appellant cannot therefore claim any benefit under section 5 (4) (a) of the Act. [401C] (3) section 21 of the Act under which the land in question becomes liable to be included in the holding of the appellant for purposes of determination of the surplus land does not make any difference between stridhana property of a female acquired after the commencement of the Act by inheritance or bequest from any person and any other property held by her family. [401D] (4) A reading of the definition of the expression "stridhana land" in section 3 (42) of the Act and the provisions of section 5(4) of the Act, indicate that the State Legislature intended to extend the concession available under section 5 (4) of the Act only to the land held by a female on the date of the commencement of the Act and not to land acquired by her thereafter. [401E] (5) The object of the legislation is the acquisition of agricultural land in excess of the ceiling area and distribution of the same amongst the landless among the rural population. If the construction urged by the appellant is placed on section 21 of the Act, the very object of the statute would be defeated. There is also no room for construing section 5 (4) (a) of the Act as being applicable to agricultural land acquired by a female even after the commencement of this Act. [401G, F] (6) If the Legislature intended that lands acquired by way of inheritance or bequest by a female on or after the commencement of the Act should also be dealt with in accordance with section 5(4), it would have defined the expression "stridhana land" without the words "on the date of the commencement of this Act." [401H] (7) The Act is applicable to Hindus as well as others governed by other personal laws. This indicates that the expression 'stridhana ' is not used in the Act in the sense in which it is used in Hindu law. [402A] Valliammal vs The Authorised Officer, Land Reforms, Coimbatore , over ruled.

ivil Appeal No. 1484 of 1974. From the Judgment and Decree dated 26.4.1974 of the Jammu & Kashmir High Court in Civil Second Appeal No. 4 of 1973. A.K. Sen, E.C. Agrawala, Ms. Purnima Bhat, Atul Sharma and A. V. Palli for the Appellant. S.K. Bhattacharya (NP) for the Respondent. The Judgment of the Court was delivered by KULDIP SINGH, J. Hazrat Baba Ibrahim, a Saint, lived in the area called Rakhbahu in the city of Jammu. After his demise in the year 1872 his grave became a place of worship for those who had faith in him. The place was called Ziarat Hazrat Baba Ibrahim (hereinafter called "the Ziarat"). The Ziarat was managed by Sain Ladha, a nephew of Baba Hazrat Ibrahim After Sain Ladha 's death his son Mian Lal Din succeeded him. At present the Ziarat is being managed by the sons of Mian Lal Din who died in the year 1963. The Jammu & Kashmir Muslim Wakf Act came into force in the year 1959 (hereinafter called "the Act") whereunder a committee of muslim Wakf (hereinafter called "the Committee") has been incorporated. The Committee filed a suit against Anayatullah and eight others (sons of Mian Lal Din) restraining them from alienating, raising construction or recovering the rent from the Wakf land in dispute vested in the Ziarat. According to the plaintiff, the Government of Jammu & Kashmir vide two orders dated September, 22, 1955 and November, 29, 1958 granted land measuring 3 acres and 6 acres 2 kanals 6 Marlas respectively to the Ziarat. It was alleged that the defendants were treating the property to be their personal property. They were mismanaging and also alienating the same. The defendants in their written statement resisted the suit on a number of grounds and 256 stated that the land in dispute was transferred by the Government in favour of their father in lieu of his possessory right over about 400/500 Kanals of land which was taken over by the Government. It was further claimed that the land was the absolute property of their father and the same has devolved upon the defendants by succession. It was further claimed that notwithstanding the word "Ziarat" in the Government Orders the grants were in favour of the defendants father in his personal capacity. The transfer of the land was not in the form of any dedication and as such was not a property of the Ziarat. The defendants claimed the right to deal with the property in any manner they liked on the ground that the same belonged to them. The Trial Court by its Judgment dated August 6, 1970 came to the conclusion that the two grants by the State Government were in fact made in favour of Mian Lal Din and not in favour of the Ziarat. The suit of the committee was dismissed with costs. The District Judge, Jammu by his Judgment dated February 28, 1973 upheld the findings of the Trial Court and dismissed the appeal of the committee. The committee went up in second appeal before the Jammu & Kashmir High Court. Murtaza Fazal Ali, C.J. (as the learned Judge then was) by his judgment dated April 26, 1974 set aside the judgments of the courts below and allowed the appeal of the committee. The Learned Chief Justice decreed the plaintiff 's suit for injunction as prayed for. This appeal via Special Leave Petition is against the judgment of the High Court. Mr. Ashok Sen, learned counsel appearing for the appellant has taken us through the judgment of the Trial Court and that of the Lower Appellate Court. According to him, the High Court has erred in upsetting the findings of the courts below based on appreciation of evidence. Mr. Sen contended that the appellant 's ancestors were in possession of ' more than 140 Kanals of land for a very long period and had established possessory title over the said land. According to him, the Government took over the said land from the father of defendants and in lieu of that two grants in the years 1955 and 1958 were given to Mian Lal Din in his personal capacity. It was contended that on appreciation of the evidence produced before the Trial Court the courts below found as a fact that the defendants were the owners of the property subject matter of the Government grants and as such the High Court acted illegally in upsetting the same. The learned counsel relied upon the following findings of the Lower Appellate Court in support of his contention: 257 "As discussed above, the possession of the defendants and their father and grand father and Hazrat Baba Ibrahim over 40 kanals of land as Arak and about 100 kanals of land under cultivation is proved, and it is further proved from the Government order Ext. D.A./4 refusing the recommendation of the Financial Commissioner that the basis for the grant of proprietary rights in respect of 74 kanals of land was the personal possession of the father of the defendants and his predecessors and it was in lieu of the possession of that chunk of land that the Government parted with 74 kanals of land. The counsel for the plaintiff has further argued that because the Government orders of 1955 and 1958 mentions the word "Ziarat" as the grantee it is not permissible for the Civil Court to hold that the grant was in favour of the father of the defendants. Keeping in view the back ground as discussed above, I am unable to agree with the contention of the learned counsel for the plaintiff. The mere fact that Mian Lal Din was associated with the Ziarat as a descendant of Hazrat Baba Ibrahim Sahib and the mere fact that the word "Ziarat" was used in the Government orders of 1955 and 1958 would not preclude this Court from holding that the grant was not in favour of the Ziarat but was in fact in favour of the father of the defendants. The contents of the Government orders of 1955 and 1958 referred to above are to be considered with the facts that Mian Lal Din and his ancestor possessed the land in their individual capacity; that the Government repelled the claim of Mian Lal Din for additional grant of land on the simple ground that the land already granted to him was costlier than the land which he held in possession; that there was no intention on the part of the Government to dedicate the land to the Ziarat out of any pious intention; that it was a sort of bargain between Mian Lal Din, the father of the Defendants and the Government where under the land measuring 74 kanals was parted within the proprietary rights by the Government in consideration of Lal Din 's having abandoned possession of over 400 kanals Of land; the fact that the Committee plaintiff also treated the grant in favour of Lal Din as is evident from Ext. PD also supports my view. The fact that the defendants and their father leased out a part of the property on a long lease to third parties, the fact that the defendants got compensation for a portion of the land acquired by the Government; the fact that there was no claim laid to the land by the Wakf 258 Committee upto the year 1966 even when the Government orders were passed in 1955 and 1958, the fact that no demand was ever made from Lal Din to render accounts in respect of the income specially derived by him from the suitland, the fact that a large number of shops, khokhas and buildings have been constructed by the defendants (assuming that one room was constructed by the Wakf Committee) also is determinative of the fact that the transfer was infact made in favour of Lal Din and not in favour of the Ziarat as such. " It is not disputed that the property which is subject matter of the dispute was granted by the State Government under the two orders dated September 22, 1955 and November, 29, 1958. The respondent plaintiff claims that the grant was in favour of the Ziarat whereas the appellant defendants claim that the property was given to the father of the defendants absolutely and in his personal capacity. The two documents of title by which the grant was made may now be referred to. The Government order dated September 22, 1955 is as under: "It is ordered that 3 acres of land of Rakhbahu of the Rakhs and Farms Deptt. surrounding the Ziarat Shareef of Baba ibrahim Shah be granted to the said Ziarat e Shareef permanently. By order of the Cabinet. Sd/ (G.M. Bakshi) Prime Minister". The Government order dated November, 1958 runs thus; "(1) The confirmation of the action taken by the Prime Minister in granting land measuring 6 acres 2 kanals and 6 marlas to Ziarat Shareef Baba Ibrahim Shah Sahib at Ghandi Nagar Jammu and (2) The grant of compensation amounting to Rs. 12,500 by debit to Housing grant in favour of the said Ziarat for 12.5 kanals of land @ Rs. 1000 per kanal, taken over by the Public Works Department for development of Gandhi Nagar out of the area of 3 acres sanctioned vide Cabinet Order No. 1418 C dated 20.9.55. By order of the Jammu and Kashmir Government Sd/ Noor Mohd Secretary to Government" 259 The above quoted orders of the Government are absolutely clear and unambiguous and can admit one and only one interpretation that the Government intended to grant the land to Ziarat alone and not to the appellant defendants in their personal capacity. In fact the names of the appellants defendants or their ancestors are not even mentioned in the two orders. The High Court interpreted the above quoted two orders as under: " The order of 1955 specifically stated that the lands in Rakhbahu surrounding the Ziarat Shared of Baba Ibrahim Shah be granted to the said Ziarat permanently. The later order of 1958 also says the same thing. It is nowhere mentioned in any of these orders that the land was given not to the Ziarat but to the defendant who was Mujawar of the Ziarat either in his personal capacity or in lieu of compensation for his personal lands acquired by the Government. Since the recitals in the documents are absolutely clear and are expressed in unmistakable terms, there is no room for adducing evidence adduced to contradict the recitals of these two documents. Thus the evidence adduced by the defendants to show that the grant was made not to the Ziarat but to them is clearly hit by sections 91 and 92 of the Evidence Act and is, therefore, inadmissible. Further more the grant was made in 1955 and 1958, that is to say several years before and the Government has not come forward after such a long lapse of time to support the stand of the defendants that the grant was intended for them in their personal capacity and not for the Ziarat. I fail to understand how in face of such clear recitals in the documents the courts below have by a process of evisceration and interpolation construed the documents to means as if it was a grant in favour of the defendants. The courts below appear to have been influenced by the fact that when the defendants represented to the Government that the lands in their cultivating possession had been taken over by the Government without paying compensation, some Government Officers replied that a substantial grant of land had been made to the Ziarat. This obviously was a wrong stand taken by the Government Officers and could not clothe the defendants with the right of wiping out the legal validity of the grant made year before the officers gave this reply. Indeed the remedy of the defendants was to sue for damages or for compensation for, the land unlawfully acquired by the Government. There was no justification for the 260 defendants to cast their covetous eyes on the property of the Ziarat, taking advantage of their possession over the same which was an managers or trustees and asset a hostile title to it. The law on the subject is absolutely clear that a manager or a trustee in possession of a religious shrine cannot be allowed to asset a hostile title unless he formally surrenders possession to the lawful authority. Before going into this point of law at some length it may be necessary to refer to certain proved facts in the case: (1) It is not disputed that the present Ziarat existed since a long time and became a Wakf by long public user. (2) That the first defendant was the Sajadanashin or caretaker of the Ziarat. (3) That the land belonged to the Government originally. (4) That the Government granted the land in dispute to the Ziarat and not to the defendants. (5) That the defendants were admittedly in possession of the Ziarat as also the properties appurtenant thereto. In these circumstances it is clear that even if the defendants were in possession of the lands, their possession would have to be referable to a lawful title and cannot be treated to be adverse to the Ziarat. In other words the possession of the defendants would be for the benefit of the Ziarat. We agree with the above quoted findings of ' the High Court and approve the same. We do not agree with the argument of Mr. Ashok Sen that the High Court was in error in upsetting the findings of the courts below. The question before the High Court was the interpretation of two government orders which was essentially a question of law. The High Court was justified in observing that in the face of clear and unambiguous terms of the Government orders it was not permissible for the appellant defendants to adduce evidence to show that the grant was made to them and not to the Ziarat. No other point was raised before us. We, therefore, dismiss the appeal. The respondent plaintiff shall be entitled to costs throughout which we quantify as Rs. 15,000. N. P. V. Appeal dismissed.

The Ziarat Shareef of Hazrat Baba Ibrahim, a holy place of worship, in the Rakhbahu area of Jammu City was granted certain land to the Ziarat by the State Government vide two orders dated September 22, 1955 and November 29, 1958. The Ziarat was being managed by the 1st appellant and his brothers, since the death of their father in 1963. The Committee of Muslim Wakf, incorporated under the Jammu and Kashmir Muslim Wakf Act, which came into force in 1959, file a suit for restraining them from alienating, raising construction or recovering the rent from the Wakf land in dispute vested in the Ziarat, on the allegation that the appellants defendants were treating the lands granted to the Ziarat, as their personal property and mismanaging and also alienating the same. Resisting the suit, the appellants, defendants contended, inter alia, that notwithstanding the use of the word "Ziarat" in the two Government orders the transfer of the land in dispute was in their father 's favour in his personal capacity, in lieu of his possessory right over about 400/500 kanals of land which was taken over by the Government, and not in the form of any dedication, and as such the land was not the property of the Ziarat but their father 's absolute property, and had devolved upon them by succession and, therefore, they had the right to deal with the property in any manner they liked. The trial court dismissed the suit, holding that the two grants were in fact made in favour of defendants ' father and not the Ziarat. 254 The first appellate court upheld the trial court 's findings. However, in second appeal, the High Court held that from the recitals of the two orders of the Government of 1955 and 1958 it was clear that the two grants were in favour of the Ziarat. Hence, the appellants defendants filed the appeal, by special leave before this Court contending that the High Court had erred in upsetting the findings of the courts below, based on appreciation of the evidence that, as a fact, the appellants defendants were the owners of the property, the subject matter of the Government grants. Dismissing the appeal, the Court, HELD: 1.1 The two orders of the Government dated September 22, 1955 and November 29, 1958 are absolutely clear and unambiguous and can admit one and only one interpretation that the Government intended to grant the land to the Ziarat alone and not to the appellants defendants in their personal capacity. In fact the names of the appellants defendants or their ancestors are not even mentioned in the two orders. The order of 1955 specifically stated that the lands in Rakhbahu surrounding the Ziarat Shareef of Baba Ibrahim Shah be granted to the said Ziarat permanently. The later order of 1958 also says the same thing. It is nowhere mentioned in any of those orders that the land was given not to the Ziarat but to the father of the appellants defendants, who was Majawar of the Ziarat, either in his personal capacity or in lieu of compensation for his personal lands acquired by the Government. [259A, B C] 1.2 A manager or a trustee in possession of a religious shrine cannot be allowed to assert a hostile title unless he formally surrenders possession to the lawful authority. [260B] In the instant case, there was no justification for the appellants defendants to cast their covetous eyes on the property of the Ziarat, taking advantage of their possession over the same, which was as managers or trustees and assert a hostile title to it. Even if they were in possession of the lands, it would have to be referable to a lawful title and cannot be treated to be adverse to the Ziarat. In other words, the possession would be for. the benefit of the Ziarat. [259H, 260A, E] 1.3 In the face of clear and unambiguous terms of the Government orders, it was not permissible for the appellants defendants to adduce evidence to show that the grant was made to them and not to the 255 Ziarat. The question was of interpretation of two Government orders, which was essentially a question of law. [260G] In the circumstances, the High Court was not in error in upsetting the findings of the courts below. [260F]

iminal Appeal No.122 of 1965. Appeal from the judgment and order dated December 1, 1964 of the Allahabad High Court in Government Appeal No.785 of 1963. P. Rana, for the appellant. J. P. Goyal and Sobhag Mal Jain, for the respondents. The Judgment of the Court was delivered by Hegde, J. In this appeal by certificate, the only question that arises for decision is as to the true scope of the expression "time requisite for obtaining a copy of the decree, sentence or order appealed from" found in sub section 2 of section 12 of the Indian Limitation Act 1908 which wilt be hereinafter referred to as the Act. The said question arose for decision under the following circumstances: The respondents were tried for various offences before the learned assistant sessions judge, Farrukhabad. The said learned judge acquitted them. Against the order of acquittal the State went up in appeal to the High Court of Allahabad. The said appeal was dismissed as being barred by limitation. The correctness of that decision is in issue in this appeal. Item 157 of the first schedule to the Act prescribes that the period of limitation for an appeal under the Code of Criminal Procedure 1898, from an order of acuittal is three months from the date of the order appealed from. But sub section 2 of section 12 provides that in computing the period of limitation prescribed for an appeal the day on which the judgment complained of was pronounced and the time requisite for obtaining a copy of the order appealed from shall be excluded. The memorandum of appeal was filed into court on March 29, 1963. The order appealed from bad been delivered on Novem ber 10, 1962. According to the information contained in the copy of the order produced along with the said memorandum the appeal was within time. It showed that that copy was, applied for on November 15, 1962 and the same was ready on January 3, 1963. It was contended on behalf of the respondents that the appeal was out of time in view of the fact that the appellant had applied for and obtained two other copies of the order appealed from and if time is calculated on the basis of those copies the appeal was beyond time. In addition to the copy referred to earlier, the 844 appellant had applied for another copy of the order appealed from on December 3, 1962 and that copy was ready for delivery on December 20, 1962. The appellant also applied for yet another copy of the same order on December 21, 1962 and that copy was made ready on the same day. There is no dispute that if the period of limitation is computed on the basis of those copies the appeal was barred by limitation. But the point for consideration is whether the obtaining of those copies has any relevance in the matter of computing the period of limitation for the appeal. The High Court of Allahabad accepted the contention of the respondents that in determining the time requisite for obtaining a copy of the order appealed from, it had to take into consideration the copies made available to, the appellant on the 20th and 21st December, 1962. It opined that the expression 'requisite ' found in section 12(2) means "properly required", and hence the limitation has to be computed on the basis of the copy made available to the appellant in December, 1962. It was not disputed on behalf of the respondents that it was not necessary for the appellant to apply for a copy of the order appealed from immediately after the order was pronounced. The appellant could have, if it chose to take the risk, waited till the ninety days period allowed to it by the statute was almost exhausted. Even then the time required for obaining a copy of the order would have been deducted in calculating the period of limitation for filing the appeal. Hence the expression 'time requisite ' cannot be understood as the time absolutely necessary for obtaining the copy of the order. What is deductible under section 12(2) is not the minimum time within which a copy of the order appealed against could have been obtained. It must be, remembered that sub section 2 of section 12 enlarges the period of limitation prescribed under entry 157 of Schedule 1. That section permits the appellant to deduct from the time taken for filing the appeal, the time required for obtaining the copy of the order appealed from and not any lesser period which might have been occupied if the application for copy had been filed at some other date. That section lays no obligation on the appellant to be prompt in his application for a copy of the order. A plain reading of section 12(2) shows that in computing the period of limitation prescribed for an appeal, the day on which the judgment or order complained of was pronounced and the time taken by the court to make available the copy applied for, have to be excluded. There is no justification for restricting the scope of that provision. If the appellate courts are required to find out in every appeal filed before them the minimum time required for obtaining a copy of the order appealed from, it would be unworkable. In that event every time an appeal is filed, the court not only will have to see 84 5 whether the appeal is in time on the basis of the information available from the copy of the order filed along with the memorandum of appeal but it must go further and hold an enquiry whether any other copy had been made available to the appellant and if so what was the time taken by the court to make available that copy. This would lead to a great deal of confusion and enquiries into the alleged laches or dilatoriness in respect not of copies produced with the memorandum of appeal but about other copies which he might have got and used for other purposes with which the court has nothing to do. The High Court in arriving at the decision that the appeal is barred by time relied on the decision of the Lahore High Court in Mathela and Others vs Sher Mohammad(1). It also sought support from the decisions of the Judicial Committee in Pramatha Nath Roy vs Lee( ) and J. N. Surty vs T. section Chettyar(3). The Lahore decision undoubtedly supports the view taken by the High Court. It lays down that the words "time requisite" mean simply time required by the appellant to obtain a copy of the decree assuming that he acted with the reasonable promptitude and diligence. It further lays down that the time requisite for obtaining a copy is the shortest time during which the copy would have been obtained by the appellant, and it has nothing to do with the amount of time spent by him in obtaining the copy which he chooses to tile with the memorandum of appeal. With respect to the learned judges who decided that case we are unable to spell out from the language of section 12(2) the requirement that the appellant should act with reasonable promptitude and diligence and the further condition that the time requisite for obtaining a copy should be the shortest time during which a copy could have been obtained by the appellant. We are of the opinion that the said decision does not lay down the law correctly. Now we shall proceed to consider the decisions of the Judicial Committee relied on 'by the High Court. In Pramatha Nath Roy vs Lee (2) the appellant was found to be guilty of laches. The Judicial Committee held that he was not entitled to deduct the time lost due to his laches. It is in that context the Board observed that the time which need not have elapsed if the appellant had taken reasonable and proper steps to obtain a copy of the decree or order could not be regarded as 'requisite ' within sub section 2 of section 12. That decision does not bear on the question under consideration. In J. N. Surty vs T. section Chettyar 3 the question that fell for decision by the Judicial Committee was whether in reckoning the time for presenting an appeal, the time required for obtaining (1) A.I.R. 1935 Lah. 682. L3Sup. CI/68 10 (3) 55 [.A. 161. (2) 49 I.A. 3 7. 846 a copy of the decree or judgment must be excluded even though by the rules of the court it was not necessary to produce with the memorandum of appeal the copy of the decree or judgment. Their Lordships answered that question in the affirmative. While deciding that question, their Lordships considered some of the observations made by the High Court relating to the dilatoriness of some Indian practitioners. In that context they observed "There is force no doubt in the observation made in the High Court that the elimination of the requirement to obtain copies of the documents was part of an effort to combat the dilatoriness of some Indian practitioner; and their Lordships would be unwilling to discourage any such effort. All, however, that can be done, as the law stands, is for the High Courts to be strict in applying the provision of exclusion. The word 'requisite ' is a strong word; it may be regarded as meaning something more than the word ` required '. It means 'properly required ' and it throws upon the pleader or counsel for the appellant the necessity of showing that no part of the delay beyond the prescribed period is due to his fault. " In other words, what their Lordships said was that any delay due to the default of the pleader of the appellant cannot be deducted. There can be no question of any default if the steps taken by the appellant are in accordance with law. Hence, the above quoted observations of the Judicial Committee can have no application to the point under consideraion. Preponderance of judicial opinion is in favour of the con clusion reached by us earlier. The leading case on the subject is the decision of the full bench of the Madras High Court in Panjamv. Trimala Reddy(1), wherein the court laid down that in section 12 the words 'time requisite for obtaining a copy of the decree ' mean the time beyond the party 's control occupied in obtaining the copy which is filed with the memorandum of appeal and not an ideal lesser period which might have been occupied if the application for the copy had been filed on some other date. This decision was followed by the Travancore Cochin High Court in Kunju Kesavan vs M. M. Philip(2), by the Allahabad High Court in B. Govind Rai Sewak Singh and Another vs Behuti Narain Singh(3) and by the Madhya Pradesh High Court in K. U. Singh vs M. R. Kachhi (4) . From the above discussion it follows that the decision under appeal does not lay down the law correctly. But yet we are of (1) I.L.R. (3) A.I.R. 1950 All. 486. (2) A.I.R. 1953 T.C. 552. (4) A.I.R. 1960 M.P. 140. 847 the opinion that this is not a fit case to interfere with the order of the High Court dismissing the appeal. The respondents were acquitted by the assistant sessions judge, Farrukhabad on November 10, 1962. We were informed by learned counsel for the State that this appeal was brought to this court mainly with a view to settle an important question of law, and under instructions from the State government he told us that he does not press the appeal on merits. Accordingly this appeal is dismissed. R.K.P.S. Appeal dismissed.

The appellant State filed an appeal in the High Court on March 29, 1963 against the order made by the trial court on November 10, 1962 acquitting the respondents. According to the information contained in the copy of the order produced along with the Memorandum of Appeal, the appeal was filed within time. It Showed that the copy was applied for on November 15, 1962 and it was ready on January 3, 1963. It was contended on behalf of the respondents that the appeal was out of time in view of the fact that the appellant had applied for and obtained two other copies of the order appealed from and if time was calculated on the basis of those copies the appeal was beyond time. In addition to the copy referred to earlier, the appellant had applied for another copy of the order appealed from on December 3, 1962, and that copy was ready for delivery on December 20, 1962. The appellant also applied for yet another copy of the same order on December 21, 1962 and that copy was made ready on the same day. It was not disputed that if the, period of limitation was computed on the basis of the two later copies, the appeal was barred by limitation. The High Court accepted the respondent 's contention and dismissed the appeal. On appeal to this Court. HELD : That the decision of the High Court under appeal did not lay down the law correctly. The expression 'time requisite ' in section 12(2) of the Limitation Act cannot be understood as the time absolutely necessary for obtaining the copy of the order. What is deductible under section 12(2) is not the minimum time within which a copy of the order appealed against could have been obtained. It must be remembered that section 12(2) enlarges the period of limitation prescribed under entry 157 of Schedule 1. That section permits the appellant to deduct from the time taken for filing the appeal, the time required for obtaining the copy of the order appealed from and not any lesser period which might have been occupied if the application for copy had been filed at some other date. That section lays no obligation on the appellant to be prompt in his application for a copy of the order. A plain reading of section 12(2) shows that in computing the period of limitation prescribed for an appeal, the day on which the judgment or order complained of was pronounced and the time taken by the court to make available the copy applied for. have to be excluded. There is no justification for restricting the scope of that provision. [844 E H] Mathela. and others vs Sher Mohammad, A.I.R. 1935, Lah. 682; disapproved. Pramatha Nath Roy V. Lee, 49 I.A. 307 and J. N. Surty vs T. section Chettyar, 55 I.A. 161; distinguished. 84 3 Panjam vs Trimala Reddy, I.L.R. ; Kunju Kesavan vs M.M. Philip, A.I.R. 1953 T.C. 552; B. Govind Rai Sewak Singh and Anr. vs Behuti Narain Singh. A.I.R. 1950, All. 486 and K. U. Singh vs M. R.Kachhi, A.I.R. 1960 M.P. 140; referred to.

Civil Appeal No. 1538 of 1988. From the Judgment and Order dated 8.9.86 of the High Court of Bombay in Nagpur Bench at Nagpur in C.R.A. No. 100/86. Y.S. Dharmadhikari, Dr. N.M. Ghatate and S.V. Deshpande for the Petitioners. S.S. Khanduja, Y.P. Dhingra and B.K. Saluja for the Respondents. (Not Present). The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J. In this case notice had been issued indicating that the matter would be disposed of at the notice stage. The respondents have not appeared. Special leave granted and the appeal is disposed as hereunder. The only question involved in this appeal is whether the High Court of Bombay, Nagpur Bench, was right in rejecting the revision application summarily when the learned Civil Judge had held that the award was wrongly presented in his Court and he had no jurisdiction to go into the question of validity of the award. The facts are that there was a reference to an arbitrator. The award was filed in the Civil Court at Nagpur and objection was filed against the said award. The short question upon which the learned District Judge dismissed the application was that Nagpur was not the Court which had jurisdiction to entertain application. He held in his order, inter alia, as follows: "Most of the parties to the agreement of reference are the residents of Warora in the District of Chandrapur. On the careful scrutiny of agreement of reference, the place of execution of the said agreement seems to have been omitted. I am quite unable to understand as to how the glaring mistake in respect of omission of place of execution of the agreement has been committed. It seems that the place of 687 execution of the agreement is deliberately omitted with intend to file the award in the Civil Court at Nagpur as the arbitrator is the resident of Nagpur. For his convenience to file the award in the Civil Court at Nagpur, the place of execution of the agreement seems to have been omitted. Moreover, it appears that the agreement for reference appears to have been prepared and drafted at Nagpur as stamp paper was purchased at Nagpur. It does not mean that the parties executed agreement for reference at Nagpur as the most of the parties are the residents of Warora and most of the property except the house on plot No. 94, at Shiwaji Nagar, Nagpur, is situated at Warora in Chandrapur District. An adverse inference can be drawn that the agreement of reference was executed at Warora in Chandrapur District which comes within the local jurisdiction of the Civil Judge, Senior Division, Chandrapur. " The learned Civil Judge held that the award passed by the arbitrator ought to have been filed in the court of Civil Judge, Senior Division, Chandrapur. The learned Civil Judge held that only a bit of property situated at Nagpur and the residence of arbitrator at Nagpur did not give local jurisdiction to the Court at Nagpur. He accordingly dismissed the application with the order that award be returned for presentation to the proper Court having legal jurisdiction. We are of the opinion that the learned Civil Judge was in error in view of the provisions of Sections 17 and 20 of the Code of Civil Procedure, in holding as he did. In view of the facts mentioned undoubtedly part of the dispute which was the subject matter of dispute was within the jurisdiction of the Nagpur Court. This view is further corroborated by the Section 2(c) of the . The Court at Nagpur had undoubtedly part of the jurisdiction to entertain the suit. The High Court had summarily rejected the revision application against the said order of the learned Civil Judge. The High Court, in our opinion, also was in error in not entertaining the application and in not setting aside the order of the learned Civil Judge. In the premises and in the facts of this, we are of the opinion, that the High Court and the learned Civil Judge were in error. Their orders are therefore set aside. 688 The appeal is allowed. Let the learned Civil Judge proceed with the objection to the award filed in his Court at Nagpur. The said objection may be disposed of as quickly as possible. There will be no order as to costs. G.N. Appeal allowed.

An Award of an Arbitrator in respect of properties situated mostly at Warora, Chandrapur and only a bit of property situated at Nagpur, did not mention the place of execution. The arbitrator was resident of Nagpur. The award was filed in the Civil Court at Nagpur. The Civil Judge held that only a bit of property situated at Nagpur and the residence of arbitrator at Nagpur did not give local jurisdiction to the Court at Nagpur and dismissed the application saying that the award ought to have been filed in the Court of Civil Judge, Chandrapur. The revision application was summarily rejected by the Bombay High Court. The appeal by special leave is against the judgment of the Bombay High Court. Allowing the appeal, this Court, ^ HELD: 1. The Court at Nagpur had undoubtedly part of the jurisdiction to entertain the suit, as part of the dispute which was the subject matter of the dispute was within the jurisdiction of the Nagpur Court. This view is further corroborated by Section 2(c) of the . [687F] 1.2 In view of the provisions of Sections 17 and 20 of the Code of Civil procedure, the order of the Civil Judge that the award be returned for presentation to the proper Court is erroneous. The High Court was also in error in not entertaining the application and in not setting aside the order of the Civil Judge. [687F, G H] 686 [The Court set aside the orders of both the Civil Judge and the High Court and directed the Civil Judge to proceed with the objection to the award filed in his Court at Nagpur and dispose it of as quickly as possible.] [688A B]

Civil Appeal No. 1 of 1956. On appeal from the judgment and order dated the 2nd/21st day of September 1955 of the Madras High Court in Writ Appeal No. 65 of 1955 arising out of the order dated the 5th day of May 1955 of the said High Court in Writ Petition No. 158 of 1955. G.S. Pathak, B. Ganapathy Iyer and G. Gopalakrishan, for the appellant. M. O. Setalvad, Attorney General for India, B.K.B. Naidu and Naunit Lal, for respondent No. 2. 1956. March 15. The Judgment of the Court was delivered by IMAM J. This appeal comes before us on a certificate granted by the Madras High Court that the case was a fit one for appeal to this Court as it involved two important questions, namely, the powers of the Government under section 64 A of the , as amended by the Motor Vehicles (Madras Amendment) Act, 1948 for the State of Madras (hereinafter referred to as the Act), to interfere with the orders of subordinate Transport Authorities on the ground of propriety and the limits of judicial review which the courts have under article 226 of the Constitution of India. The appellant and respondent No. 2, had applied for stage carriage permits in the Mayuram Town Service for routes Nos. 1 and 2. These applications, along with others, were considered by the Regional Transport Authority, Tanjore. By its order dated the 31st of May, 1954, it granted a permit for route No. 1 to the appellant and for route No. 2 to respondent No. 2. Both the appellant and respondent No. 2 being dissatisfied appealed under section 64 of the Act to the appropriate authority, the Central Road Traffic Board (hereinafter referred to as the Board), but the appeals were dismissed by its order dated the 18th of August, 1954. As section 64 A conferred upon the State Government certain powers, which have 258 been described in this case as revisional powers, the appellant and respondent No. 2 filed representations thereunder before the State Government against the orders of the Regional Transport Authority and the Board. The State Government set aside the orders passed by the aforesaid authorities and directed that permits for both the routes Nos. 1 and 2 be issued to respondent No. 2. Against this order, the appellant filed an application under article 226 of the Constitution in the High Court for the issue of a writ of certiorari. The application was heard by a single Judge who issued the requisite writ. Against his decision there was a Letters Patent appeal by respondent No. 2, which was allowed and the decision of the single Judge was set aside. The ground upon which the Regional Transport Authority granted the appellant and respondent No. 2 permits for routes Nos. 1 and 2 respectively was that they were experienced and were operating town buses at Kumbakonam. This opinion was approved by the Board which also thought that a certain amount of healthy competition was required in the Mayuram Town routes. It also considered that the Regional Transport Authority was within its rights in not considering the aspect of sector coverage by muffassil buses of the appellant and respondent No. 2. It appears that respondent No. 2 was covering the entire route No. 1 and the appellant was covering a portion of route No. 2. The State Government in setting aside the orders of the Regional Transport Authority and the Board passed the following order: "As between the claims of Sri Raman & Raman Ltd. and Sri Sathi Vilas Bus Service, the Government consider that it will be in the interest of the public to grant both the permits to Sri Sathi Vilas Bus Service, Poryar, since he has better facilities for operation and will be able to serve the public better. The Government of Madras therefore sets aside as improper the order of the Central Road Traffic Board No. R 27792/A2/54 dated the 18th of August, 1954 in so far as it confirms the order of the Regional Transport Authority, Tanjore granting one permit of route 259 No. 1 to Sri Raman & Raman Ltd. and directs that the two permits in question be granted to Sri Sathi Vilas Bus Service, Poryar". Before dealing with the submissions made on behalf of the appellant, it would be desirable to make reference to certain provisions of the Act concerning the grant of permits. Section 42 of the Act prohibits an owner of a transport vehicle from using or permitting it to be used in any public place save in accordance with the conditions of a permit granted by a Regional Transport Authority. Section 43 gives certain powers to the State Government to control road transport. Section 44 authorises the State Government to constitute a State Transport Authority as well as a Regional Transport Authority to perform certain functions mentioned therein. Section 47 sets forth certain matters which a Regional Transport Authority shall bear in mind in deciding to grant or to refuse a stage carriage permit. Section 64 enables a person aggrieved by the order of the Regional Transport Authority, with respect to matters men tioned therein, to appeal to the prescribed authority. Section 64 A states: "The State Government may, of its own motion or on application made to it, call for the records of any order passed or proceeding taken under this Chapter by any authority or officer subordinate to it, for the purpose of satisfying itself as to the legality, regularity or propriety of such order or proceeding and after examining such records, may pay pass such order in reference thereto as it thinks fit". Mr. Pathak, for the appellant, contended that having regard to the terms of section 64 A, there were two stages for the exercise of power thereunder by the State Government. The first stage was the condition precedent for assumption of jurisdiction for the exercise of that power. A collateral fact had to be decided, namely whether the order passed by any authority or officer subordinate to the State Government was in fact illegal, irregular or improper. If the decision was in the affirmative, then and then only would the State Government have jurisdiction to revise the 260 order complained against. The decision of the State Government both with respect to questions of fact and law could be examined by a court in a proceeding for the issue of a writ of certiorari and such court in doing so could decide whether the order which was revised by the State Government was or was not illegal, irregular or improper. In the present case, there was no question of illegality or irregularity in the orders of the Regional Transport Authority and the Board. The only question was as to whether these orders were improper. The propriety of an order does not necessarily mean that it must be correct order. There must be something extraneous to the order it self which made it improper. Merely because the State Government took a different view of the facts to that of the authority or officer subordinate to it would not make the order of such authority or officer improper. The second stage, namely, the passing of an order as the State Government thought fit, 'could only be reached after a decision had been arrived at on the condition precedent conferring jurisdiction on the State Government to revise an order. The substantial ground upon which the State Government revised the order of the authority subordinate to it was that respondent No. 2 had better facilities for operation and would, therefore, be able to serve the public better. The authorities subordinate to the State Government, however, had the representations of the appellant and respondent No. 2, as well as other applicants, which fully stated all material particulars in this respect and it could not be said that these matters were not considered by them. The orders of the subordinate authorities accordingly must be read to mean that as between the appellant and respondent No. 2 both bad equal facilities for operation and that things being equal between them in every way, one permit should be granted for one route to the appellant and another for another route to respondent No. 2. There could be nothing improper in this. The condition precedent to the exercise of jurisdiction to revise the order was therefore absent and the State Government acted in excess of its 261 jurisdiction in revising the orders of its subordinate authorities. Mr. Pathak further contended that there was an error on the face of the record in the order passed by the State Government as it had refused to consider seniority or experience in motor transport as a factor for the granting of a permit and it thought that it could come to any conclusion it liked and reference was made to paragraph 8 of the affidavit filed on behalf of the State Government in the High Court. On the basis of that affidavit and that paragraph, it was also urged that the error on the face of the record was that the Government acted on an erroneous idea of its own jurisdiction. He further contended that section 64 A was an invalid provision. In the alternative, he urged that a court or authority, in the exercise of its revisional powers, cannot take a contrary view of the facts to that taken by the subordinate court or authority. Exercise of such revisional power could only be made in cases where the subordinate court or authority had taken a perverse view of the facts and had arrived at a conclusion which no reasonable person could have arrived at. In support of his first contention, Mr. Pathak relied upon Paragraph 116 at page 59 of Halsbury 's Laws of England, third edition, Vol. 11. It appears from an examination of that paragraph and paragraph 117 at page 60 of the same Volume that there may be cases where the jurisdiction of an inferior tribunal may depend upon the fulfilment of some condition precedent or upon the existence of some particular fact. Such a fact is collateral to the actual matter which the inferior tribunal has to try, and the determination of whether it exists or not is logically and in sequence prior to the determination of the actual question which the inferior tribunal has to try. In such a case, in certiorari proceedings, a court can enquire into the correctness of the decision of the inferior tribunal as to the collateral fact and may reverse that decision if it appears to it, on the 262 materials before it, to be erroneous. There may be tribunals, however, which, by virtue of legislation constituting them, have the powers to determine finally the preliminary facts on which the further exercise of their jurisdiction depends. With respect to them, in such cases, their decision even if wrong on facts or law cannot be corrected by a writ of certiorari. In cases where the fact in question is a part of the very issue which the inferior tribunal has to enquire into, a court will not issue a writ of certiorari, although the inferior tribunal may have arrived at an erroneous conclusion with regard to it. In the present case, if there was at all any collateral fact to be decided, it was whether the appropriate authority had in fact passed any order in respect of which powers under section 64 A could be exercised. It is not disputed that in fact orders were passed by the Regional Transport Authority and the Board, authorities subordinate to the State Government, and that these orders existed when the appellant and respondent No. 2 moved that Government to exercise its powers under section 64 A. The condition precedent and the existence of a collateral fact in that way for the exercise of powers under that section were therefore present when the State Government exercised its powers. In order to satisfy itself whether the order of an authority subordinate to it was legal, regular or proper, the State Government was not deciding the existence of a collateral fact but the issue itself as to the legality, regularity or the propriety of the order. The satisfaction of the State Government in this respect would be an expression of its opinion and not the determination of a fact upon which depended its jurisdiction to exercise its powers under section 64 A. What is the nature of the functions performed under the Act by the Regional Transport Authority, the Board and the State Government in the matter of granting or refusing to grant a permit may now, be considered. That they are not judicial is accepted, but, it is said, they are not administrative but quasi judicial and therefore amenable to the jurisdiction of 263 a court possessing the power to issue a writ of certiorari. In proceedings under sections 47, 64 and 64 A of the Act there is no determination of any individual 's rights and from that point of view the functions of these authorities may be regarded as executive or administrative. On the other hand, it may be said that a person has the fundamental right to carry on his business of plying buses and therefore has the right to have the statutory functions of these authorities properly exercised in which case they would be quasi judicial functions. Assuming this to be so, it has yet to be seen whether the State Government acted in excess of its legal authority. Chapter IV of the Act contains provisions concerning the control of transport vehicles. The Act authorises the State Government to constitute a State Transport Authority and Regional Transport Authorities, and under section 43, subject to its provisions, it can control road transport. In the first instance, the authority to grant or refuse to grant a permit is vested in the Regional Transport Authority, but its order is not final as a dissatisfied party can appeal against the order under section 64 to the appropriate authority. Before section 64 A was inserted into the Act by an Act of the legislature of the State of Madras, it might have been possible to contend that the order of a Regional Transport Authority which bad not been appealed against and the order of the appropriate authority under section 64, where an appeal bad been made, were incapable of interference by the State Government for lack of statutory authority. By enacting section 64 A, the legislature clearly intended that should not be so and that the State Government should have the powers to intervene, if it was satisfied that the order in question was either illegal, irregular or improper. In clothing the State Government with such power the legislature clearly intended the State Government to decide the issue as to whether any order in question was illegal, irregular or improper. It would not be open to a court exercising the power of certiorari to intervene merely be cause it might be of the opinion that the view taken 264 ] by the State Government was erroneous. The word "propriety" has nowhere been defined in the Act and is capable of a variety of meanings. In the Oxford English Dictionary (Vol. VIII), it has been stated to mean. "fitness; appropriateness; aptitude suitability; appropriateness to the circumstances or conditions; conformity with requirement, rule or principle; rightness, correctness, justness, accuracy". If the State Government was of the opinion that respondent No. 2 had better facilities for operation than the appellant and their service to the public ' would be more beneficial, it could not be said that the State Government was in error in think ing that the order of the Board confirming the order of the Regional Transport Authority was improper. It is to be remembered that under section 47 of the Act a Regional Transport Authority in deciding whether to grant or to refuse a permit shall have regard, amongst other things, to the interest of the public generally and the advantages to the public of the service to be provided. Assuming that in the matter of experience there was nothing much to choose between the appellant and respondent No. 2, better facilities for operation of the bus service possessed by respondent No. 2, would be to the interest of the public generally and an advantage to the public Of the service to be provided and therefore was an overriding factor when other things were equal. As between the appellant and respondent No. 2 neither the Regional Transport Authority nor the Board recorded a finding as to which of them had the better facilities for transport operation or that such faci lities as existed between them were of equal merit. The State Government did not have, therefore, the advantage of knowing, on the face of the orders of these authorities, what view they took of this matter. ,Even if it is assumed that their orders meant that the facilities for operation as between the appellant and respondent No. 2 were of equal merit, still the State Government was not in a position to know on what material this opinion was based or that it was a reasonable view. In order to satisfy itself the State 265 Government examined the materials available to it and came to the conclusion that respondent No. 2 bad the better facilities, in other words, it would be unreasonable to hold that respondent No. 2 had not the better facilities. The learned single Judge. of the High Court more than once held that he could not find that there was no material before the State Government to justify its finding that respondent No. 2 had the better facilities, and he further held that was a factor which restricted the jurisdiction of the High Court under article 226 of the Constitution. That should have concluded the matter so far as the High Court was concerned. He, however, thought that it could not be said that the conclusion reached by the State Government was the only conclusion possible and a mere disagreement on the conclusions to be drawn from the available materials, where either view was a reasonable one, was not enough to establish that the orders passed by the Board and the Regional Transport Authority were improper within the meaning of section 64 A. The State Government had therefore acted in excess of its jurisdiction,. It seems to us, that the order of the State Government as it stands cannot be said to be in excess of its jurisdiction nor can it be said that in recording a finding that respondent No. 2 had the better facilities for operation and would serve the public better, it went beyond its powers, in the absence of a finding to the contrary by the authorities subordinate to it. The interests of the public and the advantages to it of the service to be provided were very, it not the most, important factors to be taken into consideration in the matter of granting or refusing to grant a permit. In the conflicting claims of the appellant and respondent No. 2 concerning the facilities available to them for operation of the bus service, the State Government was bound to decide, in the interests of the public generally, which of these had the better facilities. It was within the scope of it 's authority to decide this and a court in certiorari proceedings ought not to interfere with that decision. To hold that the opinion of the Regional Transport Authority and the 266 Board that the facilities for operation were equal as between these persons was a reasonable view would be to constitute the court as the final authority in a matter, in which, by the provisions of the Act, that function was accorded to the State Government. We are not prepared therefore to say that the State Government acted in excess of its statutory authority. There is no error on the face of the record so far as the order of the State Government is concerned and reference to paragraph 8 of the State Government 's affidavit in the High Court does not establish any such thing. That paragraph was in answer to paragraphs 13 and 14 of the appellant 's affidavit and it set out the contentions of the State Government as to its powers. There is nothing in that paragraph to establish that in fact the State Government had declined to consider seniority or experience in the matter of selection. No substantial ground was put forward for supposing that section 64 A was an illegal provision. It was within the competence of the State Legislature to insert section 64 A into the Act. It was a reasonable provision in keeping with the entire scheme of the Act concerning transport vehicles and control of road transport. As to the extent of powers of revision in a court or authority we do not intend to express any opinion in this case having regard to the view we take that the order of the State Government cannot be interfered with by the issue of a writ of certiorari. As regards the limits of judicial review which the courts have under article 226 which is one of the grounds on which the certificate was issued by the High Court, that question has since been considered in the various decisions of this Court, which do not require recapitulation. In our opinion, this is not a case in which it would be reasonable to hold that the State Government acted in excess of its jurisdiction. The appeal is accordingly dismissed with costs to be paid to respondent No. 2.

The appellant and respondent No. 2 along with others applied for stage carriage permits for two routes and the Regional Transport Authority granted a permit for one route to the appellant and for the other route to the respondent No. 2. Both appealed to the Central Road Traffic Board but the appeals were dismissed. Neither the Regional Authority nor the Board recorded any finding as to which of them had the better facilities for transport operation or that they were of equal merit. They applied to the State Government under section 64 A of the Motor Vehicles Act of 1939 as amended by the Motor Vehicles (Madras Amendment) Act of 1948 and the State Government set aside the orders passed by the said subordi nate authorities and issued permits for both the routes to the respondent No. 2 on the ground that he had better facilities for operation and would serve the public better. Against this order of the State Government the appellant moved the High Court for a writ of certiorari and a single Judge issued the writ. On a Letters Patent appeal that decision was set aside. The appellant contended that the State Government had acted in excess of its powers under section 64 A of the Act in setting aside the orders of the subordinate authorities and that the section itself was invalid. Held, that the State Government was within its powers in passing the order it did and the appeal must be dismissed. That it was within the competence of the State Legislature to insert section 64 A into the Act and its legality could not be questioned and the clear intention of the legislation was to empower the State Government to decide the legality, regularity or propriety of any orders passed by the subordinate authorities in the interest of the general public. That the State Government was the final authority to decide which of the rival applicants had the better facilities for operation of the bus service and where it bad come to a decision in favour of an applicant, its decision could not be interfered with under article 226 of the Constitution merely because its view might be erroneous.

Civil Appeal No. 366 of 1979. Appeal by Special Leave from the Judgment and Order dated 28 2 1978 of the Madhya Pradesh High Court (Indore Bench) in Civil Revision No. 93 of 1976. Shanker Ghosh and section K. Gambhir for the Appellant. R. K. Garg and A. K. Sanghi for Respondent No. 1. The Judgment of the Court was delivered by UNTWALIA, J. This appeal by special leave is from the judgment of the Madhya Pradesh High Court reversing the decision of the Second Additional District Judge, Indore in Miscellaneous Judicial Case No. 23 of 1975. The appellant company had filed that case under Order 9 Rule 13 of the Code of Civil Procedure, hereinafter called the Code, for setting aside an ex parte decree for Rs. 28,479/ passed in favour of the respondent firm on 22 4 1975 against the appellant. The learned Additional District Judge held that summons in the suit was not duly served on the company and it came to know about the decree on 29 7 1975. Hence he set aside the ex parte decree. The respondent firm filed a revision in the High Court under section 115 of the Code. The High Court allowed the revision, set aside the judgment of the Trial Court and upheld the passing of the ex parte decree. Hence this appeal. The respondent filed the suit at Indore on 24 2 1975 against the appellant claiming damages to the tune of Rs. 26,000/ on account of the alleged non delivery of certain goods. Summons in the suit was sent to the registered office of the company in Calcutta and is said to have been served on one Shri Navlakha on 17 3 1975 asking the company to appear at Indore on 25 3 1975 for settlement of issues. Since the company did not appear in the Court on that date, eventually, 1030 the ex parte decree was passed on 22 4 1975. According to the case of the appellant the company came to know about the ex parte decree for the first time when its constituted attorney Shri section K. Jhunjhunwala received a notice from the respondent by registered post demanding the decretal dues. Thereupon Shri N. section Pareek, the Works Secretary of the company who is in charge of the legal matters was sent to Indore to ascertain as to how the ex parte decree came to be passed. Pareek learnt that the summons purported to have been served on Navlakha on 17 3 1975. Navlakha was mere Office Assistant in the Sales Department of the company. He was neither a Secretary nor a Director nor any other Principal Officer of the company authorised to receive summons in the suit. He did not bring the fact of the receipt of summons by him to the knowledge of any responsible officer of the company. The company remained in dark and, as stated above, learnt for the first time on 29 7 1975 about the passing of the ex parte decree. N. section Pareek was the only witness examined on behalf of the appellant in the Miscellaneous case tried by the learned Additional District Judge. No witness was examined on behalf of the respondent. The Trial Court held: "I hold that handing over of summons to Navlakha who was only an Office Assistant working in the company and who was not an officer duly authorised to accept summons on behalf of the company did not amount to valid service of summons on the applicant company. " It also accepted the appellant 's case about the knowledge of the ex parte decree for the first time on 29 7 1975 and hence the application filed is about a week 's time thereafter was held to be within time. The High Court in its impugned judgment has held: "It is not in dispute that the person who received the summons in the office of the Company is not a person who is entitled to be served on behalf of the company in accordance with sub clause (a) of Rule 2 of Order 29 of C.P.C." The High Court, however, took the view that since Navlakha was an employee of the company sitting in its registered office in Calcutta the summons will be deemed to have been duly served on the company within the meaning of the first part of clause (b) of Order 29, Rule 2 of the Code. In the opinion of the High Court since the learned Additional District Judge did not apply his mind to the provision of law contained in clause (b), it committed a material irregularity and illegality in exercise of its jurisdiction in setting aside the ex parte decree. 1031 In our opinion the High Court was clearly wrong in upsetting the judgment of the Trial Court. There was no error in that judgment much less any error of jurisdiction entitling the High Court to interfere with it. Order 29 of the Code is headed "Suits by or against Corporations". There are only three Rules in it. We are concerned with Rule 2 which reads as follows: "Subject to any statutory provision of process, where the suit is against a corporation, the summons may be served (a) on the secretary, or on any director, or other principal officer of the corporation, or (b) by leaving it or sending it by post addressed to the corporation at the registered office, or if there is no registered office then at the place where the corporation carries on business." Rule 2 is not an exhaustive provision providing for all modes of service on the company in the sense as to what is meant by service of summons on the Secretary, Director or Principal Officer in Jute and Gunny Brokers Ltd. and another vs The Union of India and others it was held that the words "Principal Officer" in clause (a) of Rule 2 would include managing agents and it can, under this rule, be on a juristic person. Accordingly service on managing agents who are a corporation is valid under clause (a). The meaning of clause (b) has got to be understood in the background of the provisions of the Code in Order 5 which is meant for issue and service of summons on natural persons. Sending a summons by post to the registered office of the company, unless the contrary is shown, will be presumed to be service on the company itself. But the first part of clause (b) has got to be understood with reference to the other provisions of the Code. In Rule 17 of Order 5 it has been provided: "Where the defendant or his agent or such other person as aforesaid refuses to sign the acknowledgement, or where the serving officer, after using all due and reasonable diligence, cannot find the defendant, and there is no agent empowered to accept service of the summons on his behalf, nor any other person on whom service can be made, the serving officer shall affix a copy of the summons on the outer door or some other conspicuous part of the house in which the defendant ordinarily resides or carries on business or personally works for gain, 1032 and shall then return the original to the Court from which it was issued, with a report endorsed thereon or annexed thereto stating that he has so affixed the copy, the circumstances under which he did so, and the name and address of the person (if any) by whom the house was identified and in whose presence the copy was affixed. " Sending summons to a corporation by post addressed to it at its registered office may be a good mode of service either by itself, or preferably, by way of an additional mode of service. But leaving the summons at the registered office of the corporation if it is literally interpreted to say that the summons can be left anywhere uncared for in the registered office of the company, then it will lead to anomalous and absurd results. It has to be read in the background of the provision contained in Order 5 Rule 17 of the Code. In other words, if the serving peon or bailiff is not able to serve the summons on the Secretary or any Director or any other Principal Officer of the Corporation because either he refuses to sign the summons or is not to be found by the serving person even after due diligence then he can leave the summons at the registered office of the company and make a report to that effect. In the instant case nothing of the kind was done. It was not the case of the respondent in its rejoinder filed in the Miscellaneous case that the service of the summons as effected in accordance with the first part of clause (b) of Rule 2 of Order 29 of the Code. Annexure A to the counter affidavit filed by the respondent is the petition filed by the appellant under Order 9 Rule 13 of the Code. In paragraph 9 of the said petition it was stated: "Inspection of record of this Hon 'ble Court relating to the service of the summons reveals that the bailiff of the Small Cause Court at Calcutta seems to have delivered a copy of the summons to a gentleman who is described as an office assistant, on 17 3 1975 at about 12.40 P.M. No office assistant of the defendant No. 1 Company is empowered or authorised to receive summons. The original summons which has been returned by the bailiff to this Hon 'ble Court, has been signed by one Shri Nawlakha. Shri Nawlakha was concerned merely with sales and had nothing to do with legal matters generally or with receiving summons in particular. Service of the summons on Shri Nawlakha cannot be regarded as due service on the defendant No. 1 for the purpose of Order 9 Rule 13 C.P.C." The rejoinder of the respondent is Annexure B to the counter affidavit. Para 9 of the rejoinder which is in reply to para 9 of the petition reads as follows: 1033 "In reply to para 9 it is stated that the summons was duly served as stated in this para. But it is denied that Shri Nawlakha was concerned merely with sales and has nothing to do with legal matters, generally or with receiving summons in particular. It is denied that service on Shri Nawlakha cannot be regarded as due service on the Company Defendant No. 1 for the purpose of Order 9 Rule 13 C.P.C. Shri Nawlakha was a responsible officer who could have intimated the receipt of the summons to his so called bosses. Without prejudice it is submitted that the Madhya Pradesh amendment in Order 9 Rule 13 C.P.C. may kindly be perused. " No where in the rejoinder a stand was taken that the summons was duly served on the company because it was left at the registered office of the company. Reference to the Madhya Pradesh amendment of Order 9 Rule 13 is immaterial as the Trial Court has pointed out that the company had no knowledge of the ex parte decree, even otherwise, before 29 7 1975. No contrary finding has been recorded by the High Court. We, therefore, hold that the judgment by the Trial Court setting aside the decree was correct. In any event no error of jurisdiction was committed by it. The High Court went wrong in interfering with it. We accordingly allow the appeal, set aside the judgment of the High Court and restore that of the Trial Court. The suit shall now proceed to disposal in accordance with the law. We may, however, make it clear that the appellant under the orders of the Court had furnished bank guarantee for the decretal amount. It has agreed to continue the same till the disposal of the suit. We shall make no order as to costs. S.R. Appeal allowed.

The respondent filed a suit at Indore on 24 2 1975 against the appellant claiming damages to the tune of Rs. 26,000/ on account of the alleged nondelivery of certain goods. Summons in the suit was sent to the registered office of the company in Calcutta and was served on Sri Navlakha on 17 3 1975 asking the company to appear at Indore on 25 3 1975. Since the company did not appear in the Court on that date, eventually, the exparte decree was passed on 22 4 1975. The appellant company came to know about the ex parte decree for the first time when its constituted attorney Sri Jhunjhunwala received a notice from the respondent by registered post demanding the decretal dues. Thereupon Sri N. section Pareek, the Works Secretary of the company who is in charge of the legal matters was sent to Indore to ascertain as to how the ex parte decree came to be passed. Pareek learnt that the summons was purported to have been served on Navalakha on 17 3 75. Navalakha did not bring the fact of the receipt of summons by him to the knowledge of any responsible officer of the company. He was neither secretary nor a Director nor any other principal officer of the company authorised to receive summons in the suit. The company remained in dark and learnt for the first time on 29 7 75 about the passing of the ex parte decree. The Trial Court allowed the application but the High Court in revision under section 115 of C.P.C. restored the ex parte order. Hence the appeal by special leave. Allowing the appeal, the Court ^ HELD: 1.Rule 2 of Order XXIX of C.P.C. is not an exhaustive provision providing for all modes of service on the Company in the sense as to what is meant by service of summons on the Secretary, Director or Principal Officer. Service on managing agents who are a corporation is valid under clause (a) of Rule 2 of Order XXIX C.P.C., since a Principal Officer in clause (a) of Rule 2 has been held to include managing agents and it can under this rule, be on a juristic person. [1031 D E] Jute and Guuny Brokers Ltd. & Anr. vs Union of India and Ors. [1961] 3 SCR p. 20; followed. 2.Sending a summon to a corporation by post addressed to it at its registered office may be a good mode of service either by itself, or preferably, by way of an additional mode of service. But leaving the summons at the registered office of the corporation if it is literally interpreted to say that the summons can be left anywhere uncared for in the registered office of the company. then it will lead to anomalous and absurd results. It has to be read in the background of provision contained in Order 5 Rule 17 of the Code. In other 1029 words, if the serving peon or bailiff is not able to serve the summons on the Secretary or any Director or any other Principal Officer of the Corporation because either he refuses to sign the summons or is not to be found by the serving person even after due diligence then he can leave the summons at the registered office of the company and make a report to that effect. In the instant case nothing of the kind was done. It was also not the case of the respondent in its rejoinder filed in the Miscellaneous case that the service of the summons was effected in accordance with the first part of clause (b) of Rule 2 of Order 29 of the Code. [1032 B D] 3. Nowhere in the rejoinder a stand was taken by the respondents that the summons was duly served on the company because it was left at the registered office of the company. The company had no knowledge of the ex parte decree, even otherwise, before 29 7 75. Hence the application under O.I.X Rule 13 of C.P.C. has been correctly allowed. [1033 C D]

69 of 1953. Petition under article 32 of the, Constitution for enforcement of fundamental rights. 1185 section C. Isaacs (Jai Prasad Agarwal, with him) for, the appellant. K. B. Asthana for respondent No. 1. section P. Sinha (R. Patnaik, with him) for respondent No. 4. 1953. May 22. The Judgment of the Court was delivered by PATANJALI SASTRI C. J. This is an application under article 32 of the Constitution seeking protection of the petitioners ' fundamental right under article 15 (1) against alleged violation thereof by the respondents. The petitioners are three residents of Etah in Uttar Pradesh. They complain that at the by election to the Municipal Board of Etah held on November 2, 1951, December 8, 1951, and March 17, 1952, at which respondents 4, 11 and 12 were respectively elected, the Petitioners were deprived of their rights to exercise their votes and to seek their election as candidates, as those by elections were held on communal lines on the basis of separate electorates contrary to the provisions of the Constitution. They also allege that the nomination of respondent 3 as a member of the Board by the Government was an illegal exercise of its powers, as the interest which that respondent was nominated to represent in the Board was already sufficiently represented. The petition ners accordingly pray for the issue of writs of quo warranto, mandamus and other appropriate writs or directions to respondents 3, 4, 11 and 12 to show under what authority they are acting as members of the Board and to prevent them from acting assuchmembers. Tbe petitioners also ask for wkits on the District Magistrate and the Civil Judge of Etah, respondents 2 and 13 respectively, directing them not to hold or permit the holding of any meeting of the Board which is said to be illegally constituted. Now, it cannot be seriously disputed that any law providing for elections on the basis of separate electo rates for members of different religious communities offends against article 15 (1) of the Constitution which runs thus 1186 "15 (1) The State shall not discriminate against any citizen on grounds only of religion, race, caste, sex, place of birth or any of them. " This constitutional mandate to the State not to diis criminate against any citizen on the ground, inter alia, of religion clearly extends to political as.well as to other rights, and any election held after the Constitution in ,pursuance of such a law subject to clause (4) must be held void as being repugnant to the Constitution. But the question is whether the petitioners are now entitled to the relief they seek in this application under article 32. It is true, as pointed out in the Cross Roads case(1), that article 32 provides, in some respects, for a more effective remedy through this court than article 226 does through the High Courts. But the scope of the remedy is clearly narrower in that it is restricted solely to enforcement of fundamental rights conferred by Part III of the Constitution. Any right, for instance, which the petitioners may have as rate payers in the Municipality to insist that the Board should be legally constituted and that respondents 3, 4, 11 and 12, who are not properly elected or nominated members, should not be permitted to take part in the proceedings of the Board, is outside the purview of article 32, as such right, even if it exists, is not a fundamental right conferred by Part 111. Petitioners ' learned counsel, however, contended that the fundamental right conferred by article 15 (1) on the petitioners as citizens of India was violated by the elections in question having been held on a basis which discriminated against the petitioners on the ground of their religion in that it precluded them from exercising their franchise in relation to all the candidates and from contesting the elections without regard to the reservation of seats on communal basis. Learned counsel,also submitted that the delimitation of the constituencies on communal lines was a denial of equality to the petitioners in the matter of their political rights and in that respect also infringed their (1) ; 1187 fundamental right under article 14. We are unable to accede to these contentions. It is plain that the fundamental right conferred by article 15(1) is conferred on a citizen as an individual and is a guarantee against his being subjected to discrimination in the matter of the rights, privileges and immunities pertaining to him as a citizen generally. It is not the petitioners ' case that any discrimination is now being practised or threatened against them. Their grievance is that the mode of election by separate electorates formed on communal lines involved discrimination against them in relation to seats other than those reserved for their respective communities as to which they could not exercise their right to vote or their right to stand as candidates. There is no suggestion that the petitioners actually sought to assert those rights by taking appropriate proceedings to have the bar removed and the election conducted in accordance with the Constitution. In fact, the petitioners acquiesced in the elections being conducted under the old system of separate electorates and felt no discrimination having been practised against them until a no confidence motion was tabled recently against the former Chairman who has since lost his seat as a result of that motion having been carried. Thus, the infringement of their fundamental rights under article 15(1) and art 61 14, that is, the discrimination practised against them, of which they now complain, related to rights which they in fact never sought to exercise and took no steps to assert, while there was still room for doing so, and for the exercise of which the opportunity is now lost. But, argues Mr. Isaacs, the election of the respondents 4 11 and 12 being void, they are no better than usurpers, and the petitioners are entitled to prevent them from functioning as members of the Municipal Board. It may be, as we have already remarked, that the petitioners could claim such relief as ratepayers of the Municipality in appropriately framed proceedings, but there is no question of enforcing petitioners ' funda mental right under article 15(1) or article 14 in such claim, There is still less ground for seeking relief on 1188 that basis aoainst respondent 3 who is only a nominated member. The petitioners appear to have misconceived their remedy and their application under article 32 must fail. The petition is dismissed with costs, one sot. Petition dismissed. Agent for the petitioners: K. L. Mehta. Agent for respondent No. I : C. P. Lal. Agent for respondent No. 4: section P. Varma.

The petitioners, who were residents of a municipality, alleging that they had been deprived of their rights to exercise their votes and to seek their election as candidates in certain by elections to the Municipal Board, as those by elections were held on communal lines on the basis of separate electorates contrary to the provisions of the Constitution, applied for writs tinder article 32 of the Constitution for preventing the elected candidates from acting as members of the Board, and the District Magistrate and Civil Judge from holding any meetings of the Board: Held, that, though a law which provides for elections on the basis of separate electorates for members of different religious communities offends against article 15(1) of the Constitution and an election held after the Constitution in pursuance of such a law subject to el. 4 would be void, the right which the petitioners claimed as rate payers in the municipality to insist that the Board should be legally constituted and that persons who have not been properly elected should not be allowed to take part in the proceedings of the Board was outside the purview of article 32 of the Constitution inasmuch as such a right, even if it existed, was not a fundamental right conferred by Part III of the Constitution. Held further, that the alleged infringement of the fundamental rights of the petitioners under article 15(1) and article 14, that is, the discrimination practised against them related to rights which they in fact never sought to exercise and took no steps to assert while there was occasion for doing so and the petitioners were therefore entitled to no relief under article 32 of the Constitution.

Appeal No. 136 of 1965. Appeal from the judgment and decree dated March 4, 1960 of the Calcutta High Court in Appeal from Appellate Decree No. 1021 of 1957. S.V. Gupte, and D.N. Mukherjee, for the appellants. B.K. Bhattacharya, M.K. Ghose and P.K. Ghose, for respondent No. 1. P.C. Chatterjee, G.S. Chatterlee and P.K. Bose, for respondent No. 2. The Judgment of the Court was delivered by Shelat, J. One Arunshashi Dasi, Charu Chandra Sur and Jotish Chandra Sur were the owners of the suit land admeasuring 1.15 acres situate in Rishra Municipality, West Bengal. On ' November 15, 1920 they leased the land to Srikrishna Goshala. On September 10, 1924, the said Goshala sold its leasehold interest in the said land to the 1st respondent Society. On September 5, 1935 the Society sold the said leasehold interest to one Sovaram Sarma. In 1941, the said Jostish Sur filed a Rent Suit against Sovaram and obtained an ex parte decree against him. On September 9, 1941 the said Jotish in execution of the said decree and at an auction sale held thereunder purchased Sovaram 's interest and took possession of the land. Thereafter, Sovaram 's widow and son flied a suit against the said Jotish alleging that as Sovaram had died during the pendency of the said suit the decree passed against him was a nullity and so also the auction sale. On June 27, 1945 the said suit was decreed against the said Jotish and appeals by him against the said decree both in the District Court and the High Court were dismissed. While the said suit was pending, Swaika, the first appellant herein, purchased from the said Jotish his interest in the said land for Rs. 6 '000/ and also agreed to carry on the said litigation against Sovaram 's widow and son. Swaika thereafter tried to obtain possession of the land but was foiled in doing so by an injunction obtained by Sovaram 's widow ' and son, the plaintiffs in the said suit. Swaika then got the Education Department to move for the acquisition of the said land for a Girls ' High School of which, it appears, he was the prime spirit. On July 1, 1946 the State Government 'issued the notification under see. 4 of the Land Acquisition Act in respect of the suit land. An 'inquiry under section 5A was held and thereafter on April 18, 1951 the Government issued the notification under sec. 6 and passed the necessary order under sec. On December 22, 1951 the 1st respondent Society purchased the leasehold interest in the said land from Sovaram 's widow and 119 son after their suit was finally disposed of but after the said notification under sec. 6 was issued. The 1st respondent Society then filed the present suit against the State of West Bengal, the said Swaika and other members of the managing committee of the said school for a declaration that the said notifications and the proceedings taken thereunder were mala fide and null and void and for an injunction against the Government taking possession of the said land. The Trial Court framed five issues but so far as this appeal is concerned the relevant issue is Issue No. 3, viz. "Is the plaintiff entitled to a decree for a declaration that the declaration under section 6 and order under section 7 and, proceedings under the L.A. Act in Preliminary Land Acquisition Case No. 2 of 1945 46 of Howrah Collectorate were mala fide and in fraud of the Government 's powers under the said Act and null and void and not binding on the plaintiffs ?" On this is issue, the Trial Court found that the 1st respondent Society failed to establish the allegations as to mala fides and abuse of power under the said Act and consequently dismissed the suit. In the appeal by the 1st respondent Society before the, Additional District Judge the only points urged for determination were (1) whether the said acquisition proceedings were mala fide and in fraud of the Act and therefore null and void and (2 ) whether the Society was entitled to. an injunction against the Government taking possession of the said land. It appears from the pleadings as also. the issues framed by the Trial Court that the question as to whether the State Government was satisfied or not as to the purpose and the need for acquiring the said land was not specifically raised. Therefore, an attempt was made to. raise the contention at the time of the heating of the appeal that the declaration under sec. 6 did not prove such satisfaction. The District Judge, however, dismissed the application for amendment of the plaint by the 1st respondent Society. The contention was sought to be raised because the notification used the words "as it appears to the Governor that the land is required to be taken for a public purpose" instead of the words, viz., "the Governor is satisfied that the land is needed for a public purpose. " The argument was that the said words used in the notification did not ex facie indicate the satisfaction of the government which is a condition precedent to such a declaration and that therefore sec. 6 notification was no.t in proper form and the acquisition proceedings taken thereafter were bad in law. It appears that though the amendment was disallowed, the said cOntention was allowed to be urged, for, the District Judge has answered it in the following terms : 120 declaration under sec. 6 the point that requires for consideration is whether the executive authority did actually form an opinion about the requirement of the land for public purpose. So far as the present declaration (exhibit 10A) is concerned it will go to show that the land was required for public purpose and it is conclusive in view of the provisions of section 6 of the Land Acquisition Act" On this reasoning he dismissed the appeal. The District Judge also agreed with the findings of the Trial Court that the 1st respondent Society failed to prove mala fides on the part of the Government or the misuse of its power under the Act. The 1st respondent Society filed a Second Appeal which was heard by a Division Bench of the High Court. Before the High Court, Counsel for the respondent Society raised two contentions: as to mala fides and abuse of power and (ii) that the notifications under secs. 4 and 6 were not in accordance with law and were therefore invalid. The High Court took up the second contention first and held as regards sec. 4 notification that it was valid and could not be assailed. As regards sec. 6 notification however the High Court was impressed with the contention that after the amendment of sec. 6 by Act 38 of 1923, which substituted the words "when the ' Local Government is satisfied ' for the words "whenever it appears to the Local Government", satisfaction that the land is needed for a public purpose or for a Company is a condition precedent for the declaration under sec. 6 and that therefore the Government should make a declaration "to that effect", i.e., of its satisfaction in the notification itself. The High Court accepted this contention and held that such satisfaction must appear in the declaration. The High Court also held that as the notification used the words "whereas it appears to the Governor that the land is required" instead of the words, viz, "whereas the Governor is satisfied that the land is required" the declaration did not show such ,satisfaction and therefore it was not in proper form and could not be said "to afford sufficient statutory or legal basis for proceeding in acquisition. " As regards the contention as to mala fides and fraud on the statute the High Court held that there was no evidence on the record from which it could be inferred that there was collusion between the said Swaika and the Education Department or the officers of the Land Acquisition Department and that therefore it could not be held that the proceedings were in fraud of the statute or mala fide. The High Court also observed that "prima facie, there is no reason to differ from the findings made by the courts below. " 121 The question as to mala fides of the Government or the Government having misused 'its powers or having acted in fraud of the statute was entirely a question of fact. There being a concurrent finding on that question by the Trial Court and the District Court against the 1st respondent Society, the High Court could not have reopened their concurrent finding except on the ground that it was perverse or unreasonable or without evidence. Such an argument not having been urged, the High Court could not go into that question. But it was urged that the High Court has merely expressed a prima facie view and has not conclusively accepted the finding of the Trial Court and the District Court. That argument has no merit. What the High Court really meant by the expression "prima facie" was that the finding being concurrent was binding on it and that no contention as to that finding being perverse etc., having been urged before it there was not even a prima facie case to justify the reopening of that finding. Therefore, the allegation as to mala fides or abuse of power by the Government was conclusively negatived and Counsel for the 1st respondent Society was therefore not entitled to canvass that question before us in this appeal. The only question therefore that we are called upon to decide is whether the High Court was correct in holding that (i) the Government 's satisfaction must be stated in the notification itself and (ii) that because the notification has used the words "it appears to the Governor" etc., and not the words that the Governor was satisfied, sec. 6 notification was not valid. To appreciate the construction placed by the High Court it is necessary to consider the effect of the change of words made by sec. 4 of Act 38 of 1923 in sec. As sub section 1 stood prior to 1923 the words were "subject to the provisions of Part VII of the Act, when it appears to the Local Government that any particular :land is needed for a public purpose or for a Company, a declaration shall be made" etc. The amendment of 1923 dropped these words and substituted the words "when the Local Government is satisfied after considering the report, if any, made under section 5A of sub section 2" etc. It seems that the amendment was considered necessary because the same Amendment Act inserted section 5A for the first time in the Act which gave a right to persons interested in the land to be acquired to file objections and of being heard thereon by the Collector. The new section enjoined upon the Collector to consider such objections and make a report to the Government, whose decision on such objections was made final. One reason why the word "satisfaction" was substituted for the word "appears" ' seems to be that since it was the Government who after considering the objections and the report of the Collector thereon was to arrive at its decision and then make 'the declaration required LI sup. CI/68 9 122 by sub section 2, the appropriate words would be "when the Local Government is satisfied" rather than the words "when it appears to the Local Government". The other reason which presumably led to the change 'in the language was to bring the words in sub see. 1 of see. 6 in line with the words used in see. 40 where the Government before granting its consent to the acquisition for a Company has to "be satisfied" on an inquiry held as provided thereinafter. Since the Amendment Act 38 of 1923 provided an inquiry into the objections of persons interested in the land under section 5A, section 40 also was amended by adding therein the words "either on the report of the Collector under section 5A or". 41 which requires the acquiring Company to enter into an agreement with the Government also required satisfaction of the Government after considering the report on the inquiry held under sec. The Amendment Act 38 of 1923 now added in section 41 the report of the Collector under section 5A, if any. These amendments show that even prior to the 1923 Amendment Act, whenever the Government was required by the Act to consider a report, the legislature had used the word satisfaction on the part of the Government. Since the Amendment Act 1923 introduced section 5A requiring the Collector to hold an inquiry and to make a report and required the Government to consider that report and the objections dealt with in it, the legislature presumably thought it appropriate to use the same expression which it had used in sees. 40 and 41 where also an inquiry was provided for and the Government had to consider the report of the officer making such inquiry before giving its consent. But Counsel for the 1st respondent Society argued that since the legislature has used different language from the one it had used earlier, it must mean that it did so deliberately and because it considered the new words as more appropriate. On the other hand, Counsel for the appellant argued that the meaning of both the expressions is synonymous. It is not necessary for us in this appeal to construe the two expressions as on a construction of the section we have come to the conclusion that it is not necessary that satisfaction of the Government must ex facie appear in declaration made under the section. Sub section 1 provides that when the Government is satisfied that a particular land is needed for a public purpose or for a Company, a declaration shall be made "to that effect". Satisfaction of the Government after consideration of the report, if any, made under sec. 5A is undoubtedly a condition precedent to a valid declaration, for, there can be no valid acquisition under the Act unless the Government is satisfied that the land to be acquired is needed for a public purpose or for a Company. But there is nothing in sub sec. 1 which requires that such satisfaction need be stated in the declaration. The only declaration 123 as required by sub sec. 1 is that the land to be acquired is needed for a public purpose or for a Company. Sub section 2 makes this clear, for it clearly provides that the declaration "shall state" where such land is situate, "the purpose for which it is needed", its approximate area and the place. where its plan, if made, can be inspected. It is such a declaration made under sub sec. 1 and published under sub see. 2 which becomes conclusive evidence that the particular land is needed for a public purpose or for a Company as the case may be. The contention therefore that it is imperative that the satisfaction must be expressed in the declaration or that otherwise the notification would not be in accord with sec. 6 is not correct. The construction which we have put on sec. 6 is supported by the decision in Ezra vs The Secretary of St 'ate (1) where it was held that a notification under sec. 6 need not be in any particular form. The case went up to the Privy Council but it appears from the report of that case that these observations were not challenged or disputed before the Privy Council.(2) We are also told by Counsel that no statutory forms are prescribed by the West Bengal Government for such a declaration either under the Act or the rules made thereunder though there are model forms framed presumably for the guidance. only of the officers of the Acquisition Department. There being thus no statutory forms and see. 6 not requiring the declaration to be made in any particular form, the mere fact that. the notification does not ex facie show the Government 's satisfaction, assuming that the words "it appears" used in the notification do not mean satisfaction, would. not render the notification invalid or not in conformity with sec. Apart from the clear language of sec. 6 it would seem that it is immaterial whether such satisfaction is stated or not in the notification. For, even if it is so. stated. a person interested in the land can always challenge as a matter of fact that the Government was not actually satisfied. In such a case the Government would have to satisfy the Court by leading evidence that it was satisfied as required by sec. In the present case No. such evidence was led because the fact that the Government was satisfied was never challenged in the pleadings and no issue on that question was sought to be raised. Even when the 1 st respondent Society sought to amend its plaint it did so only to say that the notification did not state such satisfaction and therefore did not establish such satisfaction. The High Court no doubt thought that this question was covered by Issue No. 3 framed by the Trial Court. But the contention said to be covered by that issue was not that there was no satisfaction on the part of the Government that the land was needed for a public purpose, viz., for he said Girls ' School, but that (1) I. , 81. (2) 32 I. A. 93. 124 the notification in the absence of words to that effect did not prove that satisfaction. That being the position and no issue having been raised on the factum of satisfaction, the State Government was never called upon to lead evidence to prove its satisfaction. The fact that sec. 5A inquiry was held and objections were filed and heard, the fact that the Additional Collector had recommended the acquisition and had sent his report to that effect and the Government thereafter issued sec. 6 notification would, in the absence of any evidence to the contrary, show that the condition precedent as to satisfaction was fulfilled. We are therefore of the view that the High Court was in error when it held that sec. 6 notification was not in accord with that section and that proceedings taken thereafter were vitiated. We may mention that Counsel for the 1st respondent Society cited certain authorities and also attempted to canvass the issue as to mala fides on the part of the Government. As to the authorities cited by him we think that they were neither relevant nor of any assistance to him. As regards the question of mala fides, we do not think there is any justification for reopening the concurrent finding of the Trial Court and the AdditiOnal District Judge. In the result, the appeal is allowed, the High Court 's judgment and decree are set aside and the judgment and decree passed by the Trial Court and confirmed by the Addl. District Judge dismissing the suit of the 1st respondent Society are restored. The 1st respondent Society will pay to the appellant the costs in this Court as also in the High Court. V.P.S. Appeal allowed.

Under section 6 of the Land Acquisition Act, 1894, the State Government issued a declaration with respect to the land of the 1st respondent after considering the report under section 5A of the Act. The declaration used the words 'as it appears to the Governor that the land is required to be taken for a.public purpose ' instead of the words 'the Governor is satisfied that the land is needed for a public purpose '. A suit filed by the 1st respondent against the State Government and others challenging the declaration was decreed in second appeal by the High Court. on the ground that: (1) the satisfaction of the Government as to the purpose of and the need for acquiring the suit land must appear in the declaration itself; and (2) as the declaration used the words 'it appears to the Governor etc., ' instead of the words 'the Governor is satisfied etc. ' it did not show such satisfaction and therefore was. not in proper form and could not form the legal basis for the acquisition. In appeal to this Court, HELD: There being no statutory form and section 6 not requiring the declaration to be made in any particular form. the mere fact that the declaration does not ex facie show the Government 's satisfaction. assuming that the words 'it appears ' used in the declaration do not mean satisfaction. would not make the declaration invalid or not in conformity with section 6. [123 E] Satisfaction of the Government after consideration of the report, any. made under section 5A is undoubtedly a condition precedent to a valid declaration. But there is nothing in section 6(1) which requires that the satisfaction should be stated in the declaration, the only declaration required by the sub section being, that the land to be acquired is needed for a public purpose or for a company. [122G H] Observations in Ezra ' vs Secretary of State, I.L.R. 30 Cal. 36, at p. 81. approved Further, it is immaterial whether or not such satisfaction is stated in the declaration. even if it was so stated a person interested in the land can always challenge. as a matter of fact, that the Government was not actually satisfied, and in such a case, the Government would ' have to satisfy the court by leading evidence that it was so satisfied. In the present case, the fact that the Government was satisfied was never challenged, the only contention raised being. that as the declaration dissatisfied was never not state such satisfaction it did not establish such satisfaction. Therefore, it was not necessary for the Government to lead any evidence prove its satisfaction. [123F H]. [Whether the words 'it appears to the Governor that the land is required to be taken for a public purpose ' and the words 'the Governor is satisfied that the land is needed for a public purpose ' are synonymous,. not decided. [122F G] 118.

tion No. 1219 of 1987. (Under Article 32 of the Constitution of India. ) T.S. Krishnamoorthy Iyer, P.N. Puri and R.K. Talwar for the Petitioner. PG NO 400 Kuldip Singh and B. Dutta, Additional Solicitor Generals, Mahabir Singh, C.M. Nayar, A.K. Srivastava, Ms. A. Subhashini, A.S. Bhasme and A.V. Rangam for the Respondents. The Judgment of the Court was delivered by RANGANATH MISRA, J. This application is under Article 32 of the Constitution. The All India Sainik Schools Employees Association through its President is the petitioner. The Sainik School Society (hereinafter referred to as "the Society") is a society registered under the Societies Registration Act, 21 of 1860. The main object of the Society, as available from clause 3(a) of the Memorandum of Association is: `to establish Sainik Schools in various parts of India, providing special school education of a high standard with the aim of preparing boys academically and physically for entry into National Defence Academy and other walks of life. " With a view to implementing this object 18 schools located in different States of the country have been established. The petitioner has impleaded the Chairman and Members of the Board of Governors of the Society as respondents 1 to 6; Ministers of Education of the seventeen States as respondents 7 to 23 and Principals of the 18 schools as respondents 24 to 41 The petitioner has asked for a writ of mandamus to the Union of India as also respondent No. l: (1) to implement the recommendations of the Fourth Pay Commission in the Sainik Schools and to extend all the benefits already given to employees of the Kendriya Vidyalayas by way of implementing the recommendations of the Chattopadhya Commission; (2) to give to the employees of the Sainik Schools the differential wages in terms of the Third Pay Commission between 1973 (when it applied to Government institutions) and 1978 (when the benefits were extended to the employees of the Sainik Schools); (3) to direct that the employees of the Sainik Schools shall have the benefits of leave travel concession house rent, pension, group insurance, contributory provident fund, pensionary benefits and gratuity in the same pattern as PG NO 401 obtaining in Kendriya Vidyalaya Sangthan or given to Defence Services Officers working in the Sainik Schools, and; (4) enhance the age of superanuation to 60 years as in the case of Kendriya Vidyalaya employees. When notice was issued to the respondents, respondent No. I alone entered appearance and made a return. Apart from raising certain technical pleas against the maintainability of the petition, it has pleaded that the Society was not an instrumentality of the State. According to the respondent No. 1, the entire capital expenditure on land, buildings, furniture and educational equipment and the major portion of the recurring expenditure is borne by the concerned State Government/Union Territory Administration of the places where the school is located. Maintenance, additions and replacement are also the obligation of the respective State Governments. The Principal, the Head Master, the Registrar and an Army Physical Training Corps/ National Cadet Corp Instructor posted in every school are paid out of the Defence budget All other expenses are met out of the fees payable by the parents or taken out of the scholarships paid by the State/Central Governments to the students. The quantum of the fees,scholarships is fixed by the Board of Governors from time to time taking into consideration the financial position The counter affidavit accepted the petitioner 's plea that several Committees had been established for bringing about improvement in the functioning of the Sainik Schools and improvement of conditions of service such as the High Power Committee Sahare Committee, Balaram Committee and the Academic Study Group Though it essence the Kendriya Vidyalayas and the other establishments of the Central Government differ from the Sainik Schools, many of the benefits admissible to Government servants and Vidyalaya teachers have already been extended to employees of the Sainik Schools The counter affidavit traversed the petitioner 's averment that the guideline of Kendriya Vidyalayas has to be adopted and the benefits admissible to the employees of such Vidyalayas should be extended to the employees of Sainik Schools According to the respondent, the Sainik Schools are of a different pattern; the historical background of their creation, the purpose for which they are founded and the other benefits which are admissible to the employees should also be borne in mind when considering the claim raised by the petitioner According to the respondents the claim based on the concept of equal pay for equal work PG NO 402 contained in Article 39(d) of the Constitution is misconceived inasmuch as unless the nature and the status of the service is the same there can be no equality. On behalf of the petitioner a rejoinder has been filed reiterating some of the averments in the main petition and meeting some of the pleadings in the counter affidavit of respondent No 1. During the pendency of this application, the Board of Governors decided to extend certain advantages and benefits to the employees of the Sainik Schools. Some of these benefits had been claimed in the writ petition. An affidavit has been filed on behalf of the petitioner indicating what are the claims still in issue on the basis of the respondents ' affidavit dated July 29, 1988. It is not necessary to recount the concessions extended by the Society and in our view what is claimed as subsisting items may now be dealt with These are: 1. The age of retirement should be 60 years applicable to all categories of employees being the same as obtaining in the case of employees of the kendriya Vidyalaya Sangathan (K.V.S.). Bonus and gratuity should be effective from 1.1.1986 and employees who have either retired or resigned after that date should be given benefit of the Contributory Provident Fund and gratuity at Central Government rates. 3 Medical reimbursement should he provided on the same basis as admissible to K.V.S. and Central Government employees. Leave Travel Concession including once in a block of four years to travel anywhere in lndia as available to employees of K.V.S. and Central Government employees should be available. Leave rules to all categories of employees should be placed at par with employees of K.V.S. 6. House Rent Allowance should be granted with effect from 1.10.1986, at par with Central Government employees. The pay scale recommended by the Chattopadhyay Commission to Teachers should be effective from 1.1.1986. PG NO 403 8. The Librarians should be given the benefit of pay revision as per the Chattopadhyay Commission pay scale with effect from 1.1.1986. Office Superintendent, Accountants and Personal Assistant to the Principals should be given the same pay as their counterpart receive from the Central Government with effect from 1.1.1986. Nursing Sisters/Assistants/Compouders should be granted pay scales at par with Pharmacists in Central Government under Para Medical Staff as per recommendations of the 4th Pay Commission with effect from 1.1.1986. House Construction Loan, Scooter and Car Purchase Loan should be granted at par with K.V S./Central Government Scheme. 15% extra pay over and above scales admissible to K.V.S. teachers should be admissible to the Sainik School teachers . The difference in wages between 1.1.1973 and 30th June, 1978 on account of delayed implementation of the 3rd Pay Commission 's recommendations should be paid. Bonus for 1984 85 and 1985 86 should also be paid at par with K.V.S 15. All employees who have retired by now before completing 60 years of age and have not yet attained the age of 60 years should be called back to duty and given postings. As we have already indicated, it is the contention of the petitioner that the Sainik School Society is `State ' within the meaning of Article 12 and is accordingly amenable to claim and enforcement of fundamental rights. It is also to be guided by what is provided in Part 4of the Constitution by way of Directive Principles of State Policy. A Constitution Bench of this Court in Ajay Hasia & Ors. vs Khalid Mujib Sehravardi & Ors., ; was considering whether a Society registered under the PG NO 404 Societies Registration Act of 1861 could be "State" within the meaning of Article 12. Bhagwati, J., as he then was, speaking for the unanimous Bench called out six tests from the judgment of this Court in International Airport Authority case (1979) 3 SCC489. Those tests are: "(1) One thing is clear that if the entire share capital of the Corporation is held by Government, it would go a long way towards indicating that the Corporation is an instrumentality or agency of Government. (2) Where the financial assistance of the State 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 a State conferred or State protected. (4) Existence of deep and pervasive State control may afford an indication that the Corporation is agency or instrumentality. (5) 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. (6) "Specifically, if a department of Government is transferred to a Corporation, it would be ;l strong factor supportive of this inference" of the Corporation being an instrumentality or agency of Government. " Applying those tests the Constitution Bench found that the Society which managed the Regional Engineering College at Srinagar and several others elsewhere was `State '. Having said so, this Court pointed out: "It is also necessary to add that merely because a juristic entity may be an authority and therefore State within the meaning of Article 12, it may not be elevated to the position of State for the purpose of Articles 309, 310 PG NO 405 and 311 which find a place in Part XIV. The definition of State in Article 12 which includes an authority within the territory of India or under the control of the Government of India is limited in its application only Part III and by virtue of Article 30, to Part IV; it does not extent to the other provisions of the Constitution and hence a juristic entity which may be State for the purpose of Part III and IV would not be so for the purpose of Part XIV or any other provision of the Constitution. " Applying the tests indicated at page 737 of the Reporter it cannot be doubted that the Sainik School Society is also `State '. The entire funding is by the State Government and the Central Government. The main object of the Society is to run schools and prepare students for the purpose of feeding the National Defence Academy. Defence of the country is one of the regal functions of the State. Once it is held that the Sainik School Society is `State ' within the meaning of Article 12 of the Constitution, application of Article 14 is attracted. Similarly under the Directive Principles the claim for equal pay for equal work becomes tenable. The main plank for substantiating the petitioner 's claim for relief is the allegation of discrimination founded upon the basis that the employees of the Sainik School Society though in every respect comparable to employees of K V.S. and the Central Government are not being given the same treatment K V.S. is a creation of the Government of lndia and is wholly financed out of the Central Exchequer Sainik School Society, as already pointed out, is not wholly funded by the Central Government. In fact substantial contribution for running the Sainik School comes from the funds of the State where the school is located. The Central Government 's contribution is minimal The mode of funding is mainly through scholarship by the State payable to the students. It follows out of this fact that the employees of the Sainik School cannot be treated as Central Government employees nor can they be treated as at par with the employees of K V.S. They are a class by themselves and, therefore, the stand on the basis of Article 14 by pleading discrimination against the guarantee of equality is not available. To put unequals as equals is against the objective of Article 14; in the same way is to discriminate between equals The later, however, is on the hypothesis that the two are equals. In view of the position that the employees of the Society are a distinct class by themselves, we do not think that there is any merit in the claim that there has been discrimination. PG NO 406 Similarly the claim of equal pay for equal work is indeed not tenable. No acceptable material has been placed before us to support the stand that the work in the two institutions is equal. A bare statement that both the Kendriya Vidyalayas and the Sainik Schools impart education to the students cannot sustain the claim of equal work. To maintain a claim for equal pay on the allegation of equal work requires clear material to support the basis that the work in both the institutions is the same. Kendriya Vidyalayas popularly known as Central Schools, are more or less schools as understood in common parlance. A Sainik School intended essentially to draw young men for being recruited into the National Defence Academy is not an ordinary school. Its curriculum, the pattern of teaching, the life style, the discipline and attention differ. The Sainik Schools are totally residential and the teacher is provided accommodation within the complex with a view to exposure of students to the teacher throughout the period and allow the teacher to exercise regulation over the students at all material times. The teacher is also expected to interact with the students beyond the class room. The Principal of the Sainik School is a defence service officer; so is the Headmaster for the lower classes; the Physical Instructor is also drawn from the Army. We are not in a position to accept the claim of the petitioner that the work in the two institutions is equal, and therefore, the claim for equality of pay cannot be accepted. Even though that claim is not accepted, the Sainik Schools being `state ' is amenable to the jurisdiction of the Court and it is open to the court to examine whether the conditions of service are of an acceptable pattern. The age of retirement of teachers in the Sainik Schools is till 60 years but continuance beyond 58 years is subject to physical fitness and continued satisfactory performance of duties. For non academic staff the age is 58 years which is same for most government employees. There is nothing unreasonable in this condition of service. There has been a switch over to pension and gratuity scheme with effect from 29.7.1988. The claim of the petitioner is that it should be with effect from. 1.1.1986. Keeping the mode of funding in view, we do not think the liability that would arise by ante dating the benefit from 1.1.1986 can be conveniently met. We, however, see no reason why the benefit should be extended only from 29.7.1988, which is said to be the date of the decision. It should be made operative from 1st April, ]988, which is the commencement of the current financial year. We would accordingly direct that the pension and revised gratuity scheme should be made operative from 1.4.1988. PG NO 407 We see no reason to interfere in the matter of claim for medical reimbursement. The Society has extended the benefit of medical allowance which is a known form in respect of even government servants not covered under the C.G.H. Scheme. But here again the benefit should be operative from 1st April, 1988. Coming to the Leave Travel Concession advantage, the same should be available from 1st April, 1988, while permitting the visit to the home town once in a block of two years. In terms of the recommendation of the Academic Study Group, we are inclined to extend the benefit of Leave Travel Concession for visiting any place in India once in a block of four years. When such scheme is being accepted even by non government employers on the basis that these visits improve the quality of service, we extend it to the Sainik School employees effective from 1.4.1988. Most of the employees have accommodation provided by the Sainik Schools and according to the Respondent No. 1 free furnished accommodation is provided. There may be cases where in the absence of such accommodation the employees may be living in rented accommodation, but we do not think that we should interfere in respect of this claim. The other claims raised do not appear to be reasonable except the prayer for providing house construction loan, scooter, car purchase loan. This is really nOt a heavy burden and out of the fund to be created loans are to be provided and the loan amounts are recoverable with concessional interest. According to modern thinking these advantages are normal service benefits. A residential accommodation adds to the security of the employee and a conveyance adds to his mobility. We are of the view that this benefit should be admissible to the employees. The Society shall, therefore, create an appropriate fund either to be operated through every college or through such method as may be found convenient for entertaining claims for house construction loan and loans for purchase of scooter, car etc. as may be admissible in terms of the scheme to be framed. We direct that the further benefits which we have granted by our present order should be made available to the employees by the end of 31st March, 1989. The writ petition is accordingly disposed of. There shall be no order as to costs. Before we part, we would like to place on record that learned Additional Solicitor General appearing for respondent No. 1 had candidly stated in Court that if over PG NO 408 and above what the Board of Governors had decided to sanction, if this Court was of the view that some more benefits should be given, the same may be ordered. R.S.S. Petition disposed of.

The All India Sainik Schools Employees Association in a petition filed in this Court under Article 32 of the Constitution has asked for a writ of mandamus directing the respondents, primarily, to extend to the employees working in the Sainik Schools all. the service benefits and advantages in the same pattern as obtaining in Kendriya Vidyalaya Sangthan. The petitioner 's contentions are that the Sainik School Society is `State ' within the meaning of Article 12 and is accordingly amenable to claim and enforcement of fundamental rights, and further that the society has to be guided by what is provided in Part 4 of the Constitution by way of Directive Principles of State Policy. Disposing of the petition, this Court, HELD: (1) The entire funding of the Sainik Schools is by the State Governments and the Central Government. The overall control vests in the governmental authority. It cannot therefore be doubted that the Sainik School Society is `State ' within the meaning of Article 12. 1405C] (2) Once it is held that the Sainik School Society is `State ', application of Article 14 is attracted. Similarly under the Directive Principles, the claim for equal pay for equal work becomes tenable. [405D] PG NO 398 PG NO 399 (3) Substantial contribution for running the Sainik School comes from the funds of the State where the school is located. The Central Government 's contribution is minimal. The mode of funding is mainly through scholarship by the State payable to the students. It follows out of this fact that the employees of the Sainik School cannot be treated as Central Government employees nor can they betreated as at par with the employees of Kendriya Vidyalayas. They are a class by themselves.14. [405F G] (4) In view of the position that the employees of the Sainik Society are a distinct class by themselves, there is no merit in the claim that there has been discrimination. To put unequals as equals is against the objective of Article 14. [405G] (5) The claim of equal pay for equal work is indeed not tenable. A Sainik School intended essentially to draw young men for being recruited into the National Defence Academy is not an ordinary school. Its curriculum, the pattern of teaching, the life style, the discipline and attention differ. A claim for equal pay on the allegation of equal work reguires clear material to support the basis that the work is both the institutions is the same. The claim of the petitioner that the work in the two institution is equal, and, therefore, the claim for equality of pay cannot be accepted.[406A,C E] (6) The Sainik School Society being, `State ' is amenable to the jurisdiction of the Court and it is open to the court to examine whether the conditions of service are of an acceptable pattern. [406E] (7) The Court accordingly examined the petitioner 's demands and passed appropriate orders directing specific reliefs in terms of medical, leave travel concession benefits and house building and other advances. The Court however found nothing unreasonable in the condition of service pertaining to age of retirement. [407G] Ajay Hasia & Ors. vs Khalid Mujib Sehravardi & Ors., ; and International Airport Authority case., [1979]3 SCC 489.

iminal Appeal No. 36 of 1958. Appeal by special leave from the judgment and order dated May 9, 1957, of the Patna High Court, in Criminal Reference No. 51 of 1957 and Criminal Revision No. 323 of 1957, arising out of the judgment and order dated March 20, 1957, of the First Additional Sessions Judge, Patna in Criminal Revision No. 14 of 1957. K. P. Varma and R. C. Prasad, for the appellant. H. J. Umrigar and B. P. Maheshwari, for the respondents. 728 1959. September 14. The Judgment of the Court was delivered by SUBBA RAO J. This is an appeal by special leave by the State of Bihar against the judgment of the High Court of Judicature at Patna quashing the criminal proceedings launched against the respondents in the Court of Munsif Magistrate, Patna. The two respondents were the proprietors of a firm called M/s. Patna Textiles doing business in cotton at Patna. On August 30, 1955, they despatched two bales of saries to M/s. Hiralal Basudev Prasad, cloth merchants of Balia, from Patna Ghat without obtaining a permit from the Textile Controller, Bihar. They were prosecuted under section 7 of the (X of 1955), hereinafter called the Act, read with section 3 of the Cotton Textiles (Control of Movement) Order, 1948, hereinafter called the Order, in the Court of the Munsif Magistrate, Patna. The respondents filed a petition before the said Munsif Magistrate praying for their discharge on the ground that the Essential Supplies (Temporary Powers) Act, 1946 (XXIV of 1946), hereinafter called the 1946 Act, whereunder the said Order was made, had been repealed, and, therefore, the Order ceased to have any legal force thereafter, and consequently they could not be prosecuted under the expired Order. The Munsif Magistrate rejected that petition. The Additional Sessions Judge, Patna, after perusing the records transmitted the same to the High Court under section 438 of the Code of Criminal Procedure with his opinion that the order of the Munsif Magistrate was wrong and, therefore, it might be set aside with the direction to the Munsif Magistrate to discharge the accused. The respondents also filed a revision to the High Court against the order of the Munsif Magistrate. The reference as well as the revision were heard together by Imam, J., of the High Court at Patna, and the learned Judge accepting the reference and the revision set aside the order of the Munsif Magistrate and directed the accused to be discharged. Hence the appeal. 729 The learned Counsel appearing for the state contended that the Order made under the 1946 Act was saved under section 16 of the Essential Commodities Ordinance of 1955, hereinafter called the Ordinance, and section 16 (2) of the Act, and, therefore, the accused were validly prosecuted under the provisions of the Order. The learned Counsel for the respondents argued that the order was not saved under either of the said two sections. To appreciate the contention of the parties, it is necessary to notice the relevant provisions of the 1946 Act, the Order, the Ordinance and the Act. Essential Supplies (Temporary Powers) Act, 1946. section 1 (3) : It shall cease to have effect on the twenty sixth day of January, 1955, except as respects things done or omitted to be done before that date, and section 6 of the (X of 1897), shall apply upon the expiry of this Act as if it had then been repealed by a Central Act. section 3 (1): The Central Government, 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 at fair prices, may by order provide for regulating or prohibiting the production, supply and distribution thereof and trade and commerce therein. Cotton Textiles (Control of Movement) Order, 1948. section 3: No person shall transport or cause to be transported by rail, road, air, sea or inland navigation any cloth, yarn or apparel except under and in accordance with (i) a general permit notified in the Gazette of India by the Textile Commissioner; or (ii) a special transport permit issued by the Textile Commissioner. The Essential Commodities Ordinance, 1955. Preamble: " Whereas the Essential Supplies (Temporary Powers) Act, 1946 (XXIV of 1946), which confers powers to control the production, 730 supply and distribution of, and trade and commerce in, certain commodities, expires on the 26th day of January, 1955;. . . . . . . . the President in pleased to promulgate the following Ordinance:" section 16: Any order made or deemed to be made under the Essential Supplies (Temporary Powers) Act, 1946 (XXIV of 1946), and in force immediately before the commencement of this Ordinance shall, in so far as such order may be made under this Ordinance, be deemed to be made under this Ordinance and continue in force, and accordingly any appointment made, licence or permit granted or direction issued under any such order and in force immediately before such commencement shall continue in force unless and until it is superseded by any appointment made, licence or permit granted or direction issued under this Ordinance. This Ordinance was published in the Gazette of India on January 21, 1955, and came into force on January 26, 1955. The . section 3 (1): If the Central Government is of opinion that it is necessary or expedient so to do for maintaining or increasing supplies of any essential commodity or for securing their equitable distribution and availability at fair prices, it may, by order provide for regulating or prohibiting the production, supply and distribution thereof and trade and commerce therein. section 7 (1): If any person contravenes any order made under section 3 (a) he shall be punishable (i) in the case of an order made with reference to clause (h) or clause (i) of sub section (2) of that section, with imprisonment for a term which may extend to one year and shall also be liable to fine, and (ii) in the case of any other order, with imprisonment for a term which may extend to three years and shall also be liable to fine: 731 Provided that if the Court is of opinion that a sentence of fine only will meet the ends of justice, it may, for reasons to be recorded, refrain from imposing a sentence of imprisonment;. section 16 (1): The following laws are hereby repealed : (a) the Essential Commodities Ordinance, 1955; (b) any other law in force in any State immediately before the commencement of this Act in so far as such law controls or authorizes the control of the production, supply and distribution of, and trade and commerce in, any essential commodity. (2): Notwithstanding such repeal, any order made or deemed to be made by any authority whatsoever, under any law repealed hereby and in force immediately before the commencement of this Act, shall, in so far as such order may be made under this Act, be deemed to be made under this Act and continue in force, and accordingly any appointment made, licence or permit granted or direction issued under any such order and in force immediately before such commencement shall continue in force until and unless it is superseded by any appointment made, licence or permit granted or direction issued under this Act. (3): The provisions of sub section (2) shall be without prejudice to the provisions contained in section 6 of the (X of 1897), which shall also apply to the repeal of the Ordinance or other law referred to in sub section (1) as if such Ordinance or other law had been an enactment. The said provisions may be briefly summarized thus: Under the Act of 1946, the Central Government had the power to make an order for regulating or prohibiting the production, supply and distribution of essential commodities. That Act itself provided that it would cease to have effect on January 26, 1955. In exercise of the powers conferred under section 3 of the said Act, the Central Government made the Cotton Textile (Control of Movement) Order, 1948, prohibiting any person 732 from transporting cloth, among others, without the permit of the Textile Commissioner. Before the Act ceased to have effect, i.e., on January 26, 1955, the Ordinance was promulgated on January 21, 1955, conferring on the Central Government a power similar to that conferred upon it under section 3 of the 1946 Act. The said Ordinance also provided for saving clauses in respect of certain things done under the 1946 Act. On April 1, 1955, the Act was passed practically reenacting the same provisions of the Ordinance, and thereunder the same power exercised by the Central Government under section 3 of the 1946 Act and section 3 of the Ordinance was preserved. The Act also provided for repeals and savings. The question, therefore, is whether, on the date of commission of the offence, the Order whereunder the prosecution was launched was subsisting or whether it ceased to exist. It is common case that an Order made under an Act ceases to have any legal force after the expiry of the term for which the Act is made. But it is contended that the Order survived the expiry of the 1946 Act by reason of the saving clauses provided by the Ordinance and the Act. Ordinarily, the Order should have expired on January 26, 1955. Unless it was saved by section 16 of the Ordinance the saving clause of the Act could not operate on it. We shall, therefore, consider the question from two aspects: (i) whether section 16 of the Ordinance saved the operation of the Order; and (ii) if it saved it, whether section 16(2) of the Act gave it a further lease of life. Section 16 of the Ordinance is in two parts. Under the first part,, "any order made or deemed to be made under the Essential Supplies (Temporary Powers) Act, 1946, and in force immediately before the commencement of this Ordinance shall, in so far as such order may be made under this Ordinance, be deemed to be made under this Ordinance and continue in force. " The necessary condition for the operation of this part of section 16 is admittedly complied with. The Order made under section 3 of the 1946 Act can be made under section 3 of the Ordinance; and, if so, by reason of the express words of the section, the Order must be deemed to be made under the Ordinance and continue to be in force 733 after its promulgation. But it is said that the second part of the section cuts down the wide amplitude of the phraseology used in the first part. After stating that the said Order shall continue to be in force, the second part proceeds to state " and accordingly any appointment made, licence or permit granted or direction issued under any such order and in force immediately before such commencement shall continue in force unless and until it is superseded by any appointment made, licence or permit granted or direction issued under this Ordinance ". If the Order continues in force, the argument proceeds, the second part of the section becomes otiose, for the appointment made, licence or permit granted or direction issued under the Order automatically continues in force, and, therefore, there is no necessity for enacting the second part of section 16. The anomaly occurs even if the argument be accepted, for, in that event the first part becomes unnecessary: The same result can be achieved by enacting only the second part of section 16 and omitting the first part altogether. To ascertain the meaning of a section it is not permissible to omit any part of it: the whole section should be read together and an attempt should be made to reconcile both the parts. There is no ambiguity in the provisions of the first part of the section. In clear and unambiguous terms it posits the continuation in force of the Order notwithstanding the repeal of the Act ; thereafter, it proceeds to enumerate certain past acts done under the Order, and in force immediately before the commencement of the Ordinance and says that they will continue in force in consequence of the continuance of the Order. The word " accordingly ", which means consequently, indicates that the enumerated acts will not continue in force but for the continuance of the Order itself: they depend upon the continuation of the Order. It is said that this interpretation imputes tautology to the legislature, and, therefore, should not be accepted. A scrutiny of the section shows that the second part is not really redundant, as at the first blush it appears to be. Under section 16 of the Ordinance, the Order made under the Act of 1946 continues to be 93 734 in force till another Order is made under the Ordinance. It covers two periods: (i) the period up to the date of the commencement of the Ordinance; and (ii) the period thereafter. The first part gives life to that Order, and, therefore, the acts authorised under that Order can be done subsequent to the coming into force of the Ordinance. But a question may be raised whether the past acts done under that Order are saved by the continuance of the Order, or whether the acts already done are covered by the words that the "Order shall continue in force ". The second part appears to have been enacted for the purpose of avoiding this difficulty or, at any rate, to dispel the ambiguity. Under the section both the Order and the acts previously done under the Order are saved. If so, it follows that the Order was saved and the prosecution authorized by the Order could legitimately be launched after the Ordinance came into force. Even so, it is contended that the Order saved by section 16 of the Ordinance fell with the repeal of that Ordinance and was not continued under the Act. This argument is based upon the provisions of section 16(1) and (2) of the Act. Section 16 has three sub sections. For the present argument we are concerned only with sub sections (1) and (2) of section 16. Sub section (2) is a repetition of section 16 of the Ordinance. But it is said that section 16(1)(b) of the Act indicates that the Order was not saved under that section. Under section 16(1)(a), the Essential Commodities Ordinance, 1955, is repealed, and under section 16(1)(b) "any other law in force in any State immediately before the commencement of this Act in so far as such law controls or authorizes the control of the production, supply and distribution of, and trade and commerce in, any essential commodity " is also repealed. The argument is that the Order is comprehended by the words " any other law " in cl. (b) of section, 16(1), and, therefore, when that Order is repealed under cl. (b) of section 16(1), it is unreasonable to hold that it is restored under sub section (2) of section 16. To put it in other words, an intention cannot be imputed to the legislature to repeal an order under one sub section and restore it by another sub section. If we may say 735 so, there is a fallacy underlying this argument. The words " any other law " in section 16(1)(b) can only mean any law other than the Essential Commodities Ordinance, 1955, mentioned in section 16(1)(a). It is admitted that there are laws other than the said Ordinance in force in many States controlling the production, supply and distribution of essential commodities. An order made or deemed to be made under the Commodities Ordinance, 1955, cannot be described as a law other than Essential Commodities Ordinance whereunder it is made. Such an order is comprehended by cl. (a) of section 16(1) itself, and, therefore, cl. (b) thereof has no application to it. In this view, 'an interpretation different from that we have put on the provisions of section 16 of the Ordinance cannot be given to sub section (2) of section 16 of the Act. For the reasons we have given in interpreting the provisions of section 16 of the Ordinance, we hold that under section 16(2) both the order and the acts enumerated in the second part of it survived the expiry of the Ordinance and continued in force under the Act. For the above reasons, we hold that the prosecution was validly launched against the accused under section 3 of the Order. Even so, the learned Counsel for the respondents contends that it is not a fit case for this Court to interfere under article 136 of the Constitution. The offence was alleged to have been committed on August 30, 1955, i.e., more than four years ago. The varying views expressed by the Courts indicate that there was a plausible justification for reasonable belief on the part of the accused that the Order did not survive the expiry of the life of the 1946 Act. The order of the High Court dismissing the 'application for leave to appeal to the Supreme Court shows that it was filed in contravention of the provisions of r. 28 of the Patna High Court Rules. Under the said Rules the application should have been filed immediately after the judgment was delivered. In the affidavit filed in support of that application the only reason given for not doing so was that the appellant did not give the necessary instructions. The learned Judge of the High Court rightly did not accept that reason as a sufficient 736 ground for permitting the application to be filed at a later stage. In the application for special leave filed in this Court, though it was stated that the application filed in the High Court for certificate was rejected, the reason for the rejection was not disclosed. Further, the State, presumably, filed this appeal to get the legal position clarified. We also believe that public interest does not require that the stale matter should be resuscitated. In the circumstances, we would be justified not to exercise our discretionary jurisdiction, and we accordingly dismiss the appeal. Appeal dismissed.

In exercise of the powers under section 3 of the Essential Supplies (Temporary Powers) Act, 1946, the Central Government made the Cotton Textile (Control of Movement) Order, 1948. The 1946 Act was to expire on January 26, 1955, but before that, on January 21, 1955, the Essential Commodities Ordinance was promulgated which conferred on the Central Government a power similar to that conferred by section 3 of the 1946 Act. Section 16 of the Ordinance provided that all Orders made under the 1946 Act in so far as such Orders could be made under the Ordinance shall continue in force and that accordingly any appointment made, license or permit granted or direction issued under any such Order shall continue in force. The , ,955 by section 16(i)(a) repealed the Ordinance and by section 16(i)(b) 727 repealed any other law in force in any State in so far as such law controlled the production, supply and distribution of, and trade, and commerce in any essential commodity. The savings clause section 16(2) of the 1955 Act was a repetition of section 16 of the Ordinance. The respondent contended that the amplitude of the first part of section 16 of the Ordinance was cut down by the second part and consequently section 16 did not save the Order but only the acts done under the Order, and that even if the Order was saved by section 16 of the Ordinance it was repealed by section 16(i)(b) of the 1955 Act and was not continued under that Act. Held, that the Cotton Textiles (Control of Movement) Order, 1948 was saved by section 16 of the Ordinance and was continued by section 16(2) of the , and was in force on August 30, 1955, when the offence was committed. The first part of section 16 of the Ordinance saved the order and the acts done under the Order subsequent to the coming into force of the Ordinance and the second part of section 16 saved past acts done under the Order before the coming into force of the Ordinance. The words " any other law " in section 16(i)(b) of the 1955 Act meant any law other than the Ordinance and an order made or deemed to be made under the Ordinance was not repealed by section 16(i)(b). Such an order was saved by section 16(i)(a) of the Act. Held, further, that this was not a fit case for interference under article 136 of the Constitution with the order of the High Court discharging the respondent. The offence was committed more than four years ago; the application by the appellant to the High Court for a certificate of fitness to appeal to the Supreme Court was belated ; there was plausible justification for the belief of the accused that the Order did not survive the expiry of the 1946 Act in view of the varying views expressed by the Courts; the State filed the appeal presumably to get the legal position clarified ; in such circumstances public interest did not require that the stale matter should be resuscitated.

Appeals Nos. 9 and 10 of 1954. On appeal from the Judgment and Order dated the 9th day of June 1952 of the Calcutta High Court in Appeal No. 26 of 1952 arising out of the Order dated the 6th day of December 1951 of the said High Court exercising its Ordinary Original Civil Jurisdiction in Matter No. 110 of 1950. C.K. Daphtary, Solicitor General of India, (R. Ganapathy Iyer and R. H. Dhebar, with him) for the appellant in C. A. No. 9 of 1954 and respondent No. 3 in No. 10 of 1954. section Chowdhury, (section N. Mukherji, B. N. Ghosh and A. K. Bose, with him) for the appellant in C. A. No. 10 of 1954. section M. Bose, Advocate General of West Bengal, (B. Sen and P. K. Bose, with him) for respondents Nos. I and 2 in both appeals. 1078 1955. December 19. DAS ACTING C. J. The only question canvassed before us in the above appeals, which have been beard together, is whether certain sales of goods made by Shri Ganesh Jute Mills, Ltd. (hereinafter referred to as the Mills) to the Government of India, Ministry of Industry and Supplies are to be deducted from the taxable turnover of the Mills so as to be exempt from sales tax demanded by the Commercial Tax Officer of the State of West Bengal. The relevant facts are stated below. On the first of September 1948 the Government of India, Ministry of Industry and Supplies, in Calcutta, placed with the Mills a confirmatory order in writing bearing No. Cal/J 1/2001/103 for the supply to the Government of India of a large quantity of hessian cloth of different descriptions at different prices ,therein mentioned. It was stipulated that the contract would be governed by the conditions of contract specified in Form WSB 133 as amended up to date. It was specifically mentioned that the goods ordered were required to meet an international obligation of the Government of India and as such the execution of the contract in accordance with the programme of deliveries as given in the schedule attached thereto was essential. The agreed prices were stated to be exclusive of the Bengal Sales Tax and it was stipulated that the Government of India would arrange direct payment of sales tax to the Government of West Bengal if it was ultimately found that Sales Tax was payable in respect of that contract. Pursuant to the aforesaid contract, the Mills supplied goods to the Government of India of the aggregate value of Rs. 2,10,040 calculated at the prices agreed upon. The Commercial Tax Officer, Beadon Street, District If Charge, claimed that the aforesaid sales should be included in the taxable turnover of the Mills and assessed to sales tax. The Mills, on the ,other hand, claimed exemption under section 5 of the Bengal Finance (Sales Tax) Act, 1941. (Bengal Act VI of 1941). The relevant portion of section 5 ran as follows; 1079 "5. (1) The tax payable by a dealer under this Act shalL be levied at the rate of one quarter of an anna in the rupee on his taxable turnover; (2) In this Act the expression "taxable turnover" means that part of a dealer 's gross turnover during any period which remains, after deducting therefrom (a) his turnover during that period on (i). . . (ii). . (iii) sales to the Indian Stores Department, the Supply Department of the Government of India, and any railway or water transport administration; (iv). . . (v). . (vi). . (b). . " The Mills further contended that if any sales tax was at all payable the same was payable by the Government of India and not by them. The Commercial Tax Officer overruled both these objections and on the 8th November 1950 he assessed the Mills to sales tax in respect of the supplies made by the Mills to the Government of India under the aforesaid contract and demanded a sum of Rs. 9,401 10 6. On the 6th December 1950 the Mills filed a petition under article 226 of the Constitution of India before the High Court at Calcutta. In the petition the Mills impleaded as respondents the Commercial Tax Officer, the State of West Bengal and the Union of India. The Mills prayed for a writ of mandamus on the respondents to cancel and/or recall and/or forbear from acting or giving effect to the demand dated the 8th November 1950 and from realising the sum of Rs. 9,401 10 6 and for a writ of certiorari for production of the records and proceedings before the Commercial Tax Officer and for quashing the same and for other incidental reliefs. On the same day a rule was issued on the respondents to show cause why the orders prayed for should not be made. The Commercial Tax Officer filed an affidavit in opposition disputing the contentions put forward by 1080 the Mills in support of their claim for exemption and maintaining that sales tax was due and had been legitimately assessed and demanded. On behalf of the Union of India was filed an affidavit affirmed by one M. P. Pai, the then Joint Secretary in the Ministry of Works, Production & Supply. It was therein stated that a department of the Government of India named the Department of Supply came into existence in the month of September 1939 immediately on the commencement of World War II and before the enactment of the Bengal Finance (Sales Tax) Act, 1941 (Bengal Act VI of 1941). It was averred that before the 7th January 1946 the said Department of Supply was charged with the procurement of Stores from all places in India including Bengal and that it also directed the work of Indian Stores Department in the United Kingdom and of the India Supply Mission in the United States of America. It was added that by Resolution No. 227/45 Pub(c) dated the 31st December 1945 the Governor General in Council announced the creation with effect from the 7th January 1946 of the Department of Industries & Supply in place of the existing Department of Supply and of Industries and Civil Supplies. It was claimed that the powers and functions of the Department of Industries and Supplies were the same as those of the Department of Supply and that there was no variation in the nature of the said functions whatsoever. The rule came up for hearing before Bose, J., who took the view that the newly created Department of Industries & Supplies was charged with the same work of procurement of stores for Government as had been entrusted to the Department of Supply and certain additional works and that later on the name was again changed to Ministry of Industry and Supply. The learned Judge pointed out that although there was a change in the designation of the Indian Stores Department and the Supply Department of the Government of India, section 5 (2) (a) (iii) was not amended in any way until 1949 when by an amending Act (West Bengal Act X of 1949) the exemption 1081 granted under section 5(2)(a)(iii) was withdrawn. The learned Judge appears to have regarded this con , tinuance of section 5(2) (a) (iii) in the Bengal Finance (Sales Tax) Act, 1941 as indicative of the fact that in view of the State of West Bengal the Ministry of Industry & Supply was the same as the Indian Stores Department and the Supply Department of the Government of India referred to in the section. The learned Judge accordingly held that the Mills were entitled to the benefit of the exemption and were not liable to pay sales tax in respect of the supplies in question. He accordingly, on the 3rd January 1952, made the rule absolute. The Commercial Tax Officer and the State of West 'Bengal went up on appeal from the said judgment and order of Bose, J. The appeal came up for hearing before & Bench consisting of K.C. Das Gupta, J. and P. N. Mookerjee, J. In separate but concurring judgments both the learned Judges rejected the preliminary objection taken by the Mills and the Union of India as to the maintainability of the appeal. On the merits both of them held that the Department of Industries & Supplies was not the same as the Indian Stores Department or the Supply Department of the Government of India. The old departments ceased to exist and a new department combining some of the functions of these departments and some new functions was created and that, therefore, sales to the newly created department could not be deducted from the taxable turnover under section 5(2) (a) (iii). In the result, the Appeal Court allowed the appeal with costs, set aside the order of Bose, J. and dismissed the application of the Mills under Article 226. The Mills as well as the Union of India have now come up on appeal before us with a certificate of fitness granted by the High Court. In view of the decision of this Court in National Sewing Thread Co. Ltd. vs James Chadwick & Bros. Ltd.(1), the question of maintainability of the appeal before the High Court has not been raised before us. The appeals have been fought out on the merits only. (1) ; 1082 The appeals came up before this Court for bearing on the 22nd and 23rd September 1955. After going through the records it was felt that the materials on record were not sufficient to enable the Court to determine the real point of controversy between the parties. The appeals were accordingly adjourned and directions were given for the filing of supplementary affidavits setting out the facts relied on by the parties respectively. Fresh affidavits have since been filed. It appears from the affidavit of one A. R. Iyer, Deputy Director, Directorate General of Supplies and Disposals, under the Ministry of Works, Housing & Supply, that in 1918 a department called the Contracts Directorate had been constituted as a purchasing Organisation for the needs of the Army. With effect from the 1st January 1922 the Indian Stores Department was constituted as a result of the recom mendations of the Stores Purchase Committee. The functions of this department were to act as a purchasing and inspection agency in respect of certain commodities including textile goods for all Central departments and minor Local Governments and such other authorities as might desire to avail themselves of the services of this department. Annexure III to the affidavit of Iyer indicates that it was not obligatory on the other departments to make purchases through the Indian Stores Department. Originally this department was constituted for a period of two years but by Resolution No. section 217 of the Government of India, dated the 6th May 1924, it was placed on a permanent basis and continued to discharge the same functions. Rules 5 and 6 attached to this Resolution show that purchases could also be made locally by other departments in case of emergency or for convenience. In 1939 when the outbreak of World War 11 was imminent the necessity for creating a new department was keenly felt and the Governor General in Council by a Resolution of the Home Department dated the 26th August 1939 (Annexure V to Iyer 's affidavit) announced the creation from that date of a department of Supply "to deal directly with ques 1083 tions concerning supplies of all kinds required for the prosecution of war". Annexure VIII to Iyer 's affidavit shows that the control of the Indian Stores Department and all other matters relating to the purchase of stores in India which were being then dealt with in the Department of Commerce were to be dealt with in the department of Supply as a temporary measure for the duration of the war. That the Indian Stores Department and the Contracts Directorate did not lose their identity is shown by the Office Memorandum dated the 3rd August 1940 (Annexure X, Clause 4) and Office Memorandum dated the 2nd December 1941 (Annexure XI, Clause I (a) and Clause 4). It is thus clear that up to the end of the year 1940 purchases used to be made for and on account of the Government of India by the Contracts Directorate, the Indian Stores Department and the Department of Supply and that purchases were also made locally by other departments. It was then that on the 1st July 1941 the Bengal Legislature passed the Bengal Finance (Sales Tax) Act, 1941 which by section 5(2) (a) (iii) exempted sales to the Indian Stores Department, the Supply Department of the Government of India and any railway or water transport administration from sales tax. Sales to other departments of the Government of India were not so exempted. By a Press Note dated the 2nd September 1941 issued by the Government of India in the Supply Department (Annexure XIII to Iyer 's affidavit) a purchase branch of the Supply Department for the duration of the war was created with effect from the 1st August 1941 and it shows that the Contracts Directorate and the Indian Stores Department bad then "ceased to exist as separate entities" for the duration of the war and a new branch was being organised in their place. Then came the Office Memorandum dated the 23rd December 1941 issued by the Government of India in the Department of Supply (Annexure XIV) which superseded the previous office memorandum dated the 13th December 1940 (Annexure XII). The 137 1084 authorities under the Central Government concerned with the production, manufacture and purchase of supplies were shown in Statement I annexed thereto. It is clearly mentioned therein that departments other than the ones referred to therein were and, in the absence of orders to the contrary, would remain independent of the department though working in close touch with it (Clause 3). Powers of local purchase were also not disturbed in any way (Clause 4). Statement I indicates that purchases of various supplies, e.g., medical and veterinary supplies, coal and coke for Railway and other civil and military authorities in India, etc., and Printing and Stationery stores, were independent of the Supply Department. It is thus clear that the Indian Stores Department and the Supply Department of the Government of India were not the only departments which bad authority to make purchases for and on behalf of the Government of India in its various departments. On the 21st April 1943 came Notification No. 209No. 107/43 Pub(c) whereby the Governor General in Council announced the creation, from the 22nd April 1943, of a Department of Industries and Civil Supplies to deal with (i) Statistics and Research, (ii) Development and (iii) Controls. Shortly thereafter Office Memorandum No. E4(179) dated the 14th May 1943 issued by the Department of Supply intimated that the Governor General in Council bad decided that the Department of Industries and Civil Supplies would, with effect from the 15th May 1943, take over responsibility for the procurement of cotton textiles and cotton textile stores (Annexure XVI to Iyer 's affidavit). So this Department of Industries and Civil Supplies became another purchasing organisation of the Government of India apart from the Department of Supply. The Government of India Resolution dated the 31st December 1945 announced the creation, with effect from the 7th January 1946, of the Department of Industries and Supplies in place of the existing Department of Supply and the Department of Industries and Civil Supplies. By this Resolution the Indian 1085 Stores Department and the Contracts Directorate which during the war had been brought under the Supply Department, were incorporated in the newly created department. It will be noticed that this newly created department had assigned to it the work of the procurement of stores for the Government of India which was formerly assigned to the Department of Supply and the Department of Industries and Civil Supplies. In addition to these duties this department was authorised also to deal with other things, namely, development of industries, administration of Government factories not allocated to specialised departments, Disposals of Surplus and Civil Supplies. The nature and volume of the purchases made by this newly created department became obviously different from and larger than those of the two departments it replaced. It is also noteworthy that the Department of Supply which was created for the prosecution of war was abolished as soon as the war was over (Annexure XVII to the affidavit of Iyer). The Resolution of the Government of India dated the 2nd September 1947 published in the Gazette of India dated the 6th September 1947 (Annexure XVIII) announced, amongst other things, that with effect from the 29th August 1947 the Department of Industries and Supplies would be re designated as the Ministry of Industries and Supply. From the summary of the annexures to the affidavit of Iyer filed in these proceedings it is quite clear that while the Ministry of Industries and Supply was a new designation of the Department of Industries and Supplies, the Department of Industries and Supplies cannot be regarded merely as a new designation of the Department of Supply and the Department of Industries and Civil Supplies. Indeed, the Resolution announced the "creation" of the Department of Industries and Supplies in place of the two existing departments mentioned above. This newly created department had wider powers and was a new department altogether. The exemption granted by the Bengal Finance (Sales Tax) Act, 1941 was given to two departments by name. It was not given to the 1086 sales to the Government of India in all its departments. It is true that the Indian Stores Department and the Supply Department of the Government of India were not corporate bodies but they evidently were sufficiently well defined organisations to be referred to as "entities" in some of the Press Notes and Resolutions mentioned above and even in the affidavits filed in these proceedings. Further, the Bengal Finance (Sales Tax) Act, 1941 by section 5 (2) (a) (iii) certainly dealt with these two departments as if they were distinct entities. The Act, in a manner, conferred on these two departments the status, as it were, of well defined and distinct entities at least for the purposes of that Act, namely for making sales to them exempt from the tax. If it were the object of the Bengal Legislature to give exemption to all sales to all departments of the Government of India it would have been quite easy for it to frame sub clause (iii) in a general way as sub clause (iv) had been flamed. Further, if sales to these two departments were to be regarded as covering sales to all departments of the Government of India then the sales to the railways which at that time mostly, if not wholly, belonged to the Government of India need not have been separately mentioned in the way it has been in sub clause (iii). As already stated, there were, at the date when the Act was passed, various other departments of the Government of India which were concerned with purchase of stores but quite clearly the exemption conferred by the section was not intended to extend to the sales to those departments. Therefore, the reference to these two particular departments in the section cannot possibly be read as a reference to the Government of India generally. It has been urged that the real object of section 5(2)(a)(iii) was to give exemption not to the particular departments but to the sales of such goods as, at the date of the Act, used to be made to those departments and, therefore, sales of those goods made to any department of the Government of India which came to be charged with the duty of purchasing those 1087 goods should also come within the purview of the section and be entitled to the benefit of the exemption conferred by it. We are unable to accept this line of reasoning. This interpretation will unduly narrow the scope and ambit of the exemption by limiting it to sales of only those goods as, at the date of the Act, used to be sold to those two departments and sales of other goods even to those two departments, however necessary for the prosecution of the war, would not get the benefit of the exemption. Such could not possibly be the intention of the legislature as expressed by the language used by it in framing the section. According to the section the exemption is given to all sales made to those two departments, no matter whether the sales were only of the kind of goods which used to be sold to them at the date of the Act or of other kinds of goods. The suggested interpretation involves the addition of qualifying words to the section which ordinarily it is Dot permissible for the court to do. Further, the press notes and the resolutions of the Government of India summarised above clearly indicate that there were other purchasing departments which were independent of the Indian Stores Department or the Supply Department of the Government of India and that the authority of other departments of making local purchases was not interfered with by the creation of these two departments. Therefore it may well have been that, at the date of the passing of the Act, same or similar kinds of goods used to be sold to these two departments as well as to other departments but surely it cannot be contended, in view of the language of the section, that the exemption was intended to extend to the sales of the same or similar kinds of goods to those other departments also. It is not necessary for us to pronounce any opinion as to the validity or soundness of the extreme position taken up by the learned Advocate General of West Bengal namely that as the exemption is given by a statute to sales made to two departments eo nomine it will not extend to sales made to the same department redesignated by a new name. It is enough for our present 1088 purpose to say that the Department of Industries and Supplies which was subsequently re designated as the Ministry of Industries and Supply was not the same as the Indian Stores Department or the Supply Department of the Government of India under a different name. The scope and volume of the work entrusted to the Department of Industries and Supplies was much wider and larger than that with which the two departments which it replaced bad been charged. Unlike those of the two departments, its purchases were not confined to goods necessary for the prosecution of the war. To extend the benefit of the statutory exemption to the sales made to the newly created department of Industries and Supplies, of goods not required for war purposes but, say, for meeting international obligations as in the present case, will necessarily widen the scope of the exemption and impose greater loss of revenue on the State of West Bengal than what the Act by its language intends to do. In view of the ever expanding activities of the modern welfare State indifferent fields including that of trade and commerce, the Government departments are often entrusted with the performance of well defined activities and are authorised to deal with the outside world and to enter into contracts of sale and purchase and other transactions in the same way as an ordinary person or company may do. Such Government departments, therefore, may well be regarded as distinct units or quasi legal entities, at least for the particular purposes for which they are created. At any rate, the Bengal Finance (Sales Tax) Act, 1941 by providing for the deduction of the sales to the two named departments from the taxable turnover certainly treated those two departments as distinct entities. This exemption is the creation of the statute and must be construed strictly and cannot be ex tended to sales to other departments. The fact that the section was not amended until 1949 does not at all indicate that the Bengal Legislature intended to extend the benefit of the section to any but the departments specifically mentioned in the section. In our opinion the conclusion arrived at by the Appeal 1089 Court, namely that the sales tax is payable on the sale in question is correct and these appeals must be dismissed with costs. SINHA J. I regret to have to differ from my learned brethren in the determination of the only question involved in these appeals, namely, whether the sales by the appellant in Civil Appeal No. 10 of 1954 (Messrs Shree Ganesh Jute Mills Ltd.) to the appellant in Civil Appeal No. 9 of 1954, the Union of India (the Government of India at the time of the transactions in question) were liable to payment of sales tax under the Bengal Finance (Sales Tax) Act, 1941 (Bengal Act VI of 1941), to be referred to hereinafter as "The Act". The facts leading up to these appeals may shortly be stated as follows: The Government of India in the Ministry of Industry and Supply (which for the sake of brevity may be called "The Government" entered into a contract on the 1st September 1948 with Messrs Shree Ganesh Jute Mills Ltd., which may be designated "The Mills", for the supply of hessian at certain rates and of certain description appearing in Exhibit A to the affidavit filed on behalf of the Mills. With reference to the question of sales tax the contract contains the following stipulation: "The prices shown above are exclusive of the Bengal Sales Tax. The Government of India will arrange direct payment of sales tax to the Government of West Bengal if it is ultimately found that sales tax is payable in respect of this contract". It is also provided that "This contract will be governed by the conditions of contract specified in Form WSB. 133 as amended up to date". This contract was entered into and signed by "A Huq, Deputy Director of Supplies, for and on behalf of the Governor General of India". In pursuance of the aforesaid contract the Mills supplied hessian goods to the Government of India of a certain valuation on which the Commercial Tax Officer of Bengal, the main contesting respondent, made a demand of Rs. 9,401 10 6 as sales tax from the Mills. The Mills demurred to the 1090 payment and contended that the sales in question were exempt from payment of the sales tax demanded in view of the provisions of section 5 (2) (a) (iii) of the Act. Eventually the Mills moved the High Court of Calcutta for an appropriate writ under article 226 of the Constitution against the contesting respondents. The matter was heard by a Single Judge of that Court who by his judgment dated the 6th December 1951 held that the Mills were not liable to pay the sales tax demanded and cancelled the notice of demand and directed the respondents 1 and 2 to forbear from enforcing the demand. Respondents I and 2 went up in appeal under the Letters Patent. The appeal was heard by a Division Bench which came to the contrary conclusion. The major portion of the judgment of the Letters Patent Bench was devoted to the discussion of the question whether the judgment of the learned Single Judge in the writ matter was amendable to the appellate jurisdiction under the Letters Patent. That question has not been pressed during the arguments and is therefore no more in controversy. The only question that was canvassed before us was the applicability of section 5 (2) (a) (iii) of the Act which contains the exemption, the benefit of which is being sought by the appellants in each case. The exemption is in these terms: "Sales to the Indian Stores Department ', the Supply Department of the Government of India, and any railway or water transport administration". It has been contended on behalf of the appellants that the sale of hessian by the Mills to the Government of India in the Ministry of Industry and Supply is within the terms of the exemption quoted above. On the other hand, it is contended on behalf of the Sales Tax Department of the Government of West Bengal that the sales in question were not covered by the aforesaid exemption clause. It is therefore necessary to go into some detail of the formation and development of the Department in question. The supplementary affidavit filed on behalf of the Government and sworn to by Shri A. R. Iyer, Deputy Director of Directorate General of Supplies & 1091 Disposals, discloses the following facts. The Indian Stores Department was constituted with effect from the 1st January 1922 as a result of the recommendations of the Stores Purchase Committee which had been constituted by the Government of India to examine the whole question of the constitution of an expert agency to carry out on a large scale purchase of supplies required for the public services, as recommended by the Indian Industrial Commission, with the object of encouraging the purchase of articles made in India for Government requirements. The scope and functions of the Department, inter alia, were to act as a purchasing and inspection agency, and in an advisory capacity in all matters connected with the purchase of stores for the public services, on behalf of all Central Departments of the Government and of the minor local Governments and also on behalf of such major local Governments, Company worked Railways, Corporations, Port Trusts, Municipalities and quasi public bodies and Indian States as might desire to avail themselves of the Department 's assistance. The activities of the Department consisted in the purchase and inspection in India of a large variety of goods and articles including "textile goods", so that the purchase of hessian which is the particular commodity involved in this case, would be included in the activities of the Department. The Department had been constituted in the first instance for a period of two years. But by a Resolution. of the Government of India dated the 6th May 1924 it was placed on a permanent basis. It continued to discharge the same functions as before. It made purchases not only for the needs of the civilian departments of the Government of India but also of all the requirements of the Army. Hessian which had been purchased from the Mills in this case was one of the products which the Government of India used to purchase only through the Indian Stores Department whenever needed for Government purposes. A Department called the "Contracts Directorate" had been constituted in 1918 as a, purchasing organization for the needs of the Army. But after the constitution of the Indian 138 1092 Stores Department in 1922 the Army authorities also began to utilize the services of the Indian Stores Department for procurement of several categories of stores required by them. By a Resolution of the Home Department dated the 26th August 1939, apparently to meet the demands of the imminent second world war, the Contracts Directorate and the Indian Stores Department were in 1940 amalgamated with the Department of Supply so that in 1941, when the Act was passed, the position was that the Department of Supply as reorganized on the 3rd August 1940 included amongst its activities and functions the purchase of stores for the needs of the Government. This branch of its activity was administered by the Directorate General, Supply Branch, located at New Delhi. Jute products and textiles including hessian had to be purchased only by placing indents by the department concerned with the Directorate General of Supply, New Delhi. Thus this Department absorbed for the duration of the war the purchasing sections of the Indian Stores Department and the Contracts Directorate which were placed under completely self contained organizations empowered to procure all supplies, whether for war purposes or otherwise. All authorities requiring supplies to be procured in India had to place their indents or demands on the Directorate General concerned. With effect from the 1st August 1941 the Contracts Directorate and the Indian Stores Department ceased to exist as separate entities in the Supply Department and became one purchasing organization in the said Department. This Organisation arranged for supply of all classes of stores for purposes of Government, such as textiles, leather goods, etc. Thus hessian which came under the bead of "textiles" which was being purchased in the first instance only by the Indian Stores Department continued to be purchased by the Supply Department when the Indian Stores Department came under the control of the Supply Department. By a notification dated the 21st April 1943 issued by the Government of India in the Home Department, another Department called the Industries and 1093 Civil Supplies Department was created. This Department was primarily concerned with statistics and. research and development of industries, as also ' controls on civil supplies (other than foodstuffs). When this Department was first created, it had no purchasing activity. But with effect from the, 15th May 1943 the Government directed that the new department should take over responsibility for the procurement of cotton textiles and cotton textile stores which till then were being dealt with by the Indian Stores Department which later came under the Supply Department as aforesaid. Purchase of jute and woollen textiles continued to be the responsibility of the Supply Department. By a Resolution of the Government of India dated the 31st December 1945 the Department of Industries and Supplies in place of the existing Departments of Supply and of Industries and Civil Supplies was created with effect from the 7th January 1946. From that date the Department of Industries and Supplies became responsible for the procurement of stores from all places in India in the same manner as the Department of Supply had been doing previously to its amalgamation with the new Department. The powers and functions of the Department of Industries and Supplies in the matter of procurement of stores continued as before. The Department continued to procure and purchase only the same kinds of articles as the Department of Supply had been doing before the coming into existence of the Department of Industries and Supplies so that the creation of the Department of Industries and Supplies did not make any difference in its activities relating to purchase of stores. There was no addition to or subtraction from its functions in the matter of purchase of stores. From what has been stated above, it is clear that the purchasing functions of the Government of India with special reference to the procurement of textiles including hessian with which we are immediately concerned were discharged by the Indian Stores Department from 1st January 1922. Those functions were taken over by the Department of Supply in 1940, 1094 The Department of Supply itself merged in the Department of Industries and Supplies with effect from the 7th January 1946. By a notification of the 2nd September 1947 the Department of Industries and Supplies was redesignated as the Ministry of Industry and Supply with effect from the 29th August 1947 as a result of the emergence of India as an Independent State. Thus the Ministry of Industry and Supply is a lineal descendant of the Indian Stores Department, of course, with an added volume of work and functions, but the original activity of purchase of stores remaining the same in bulk and in character. It has already been noticed that the Indian Stores Department was concerned with the function, amongst others, of purchasing stores of a large variety of articles and goods on behalf of all Central Departments of the Government of India and Local Gov ernments, Railway Companies, Corporations, Port Trusts, Municipalities and other quasi public bodies, as also Indian States if they availed of the services of the department. Thus the infant Indian Stores Department has grown in stature and volume in the course of the last about 25 years. The same sapling has grown into a shady tree but its function as the sole purchasing agency of the Government of India and other Governments for a large variety of goods and commodities has 'Continued. The nomenclature has undergone successive changes, but the function of purchasing agency on behalf of the Central and other Governments and public bodies as aforesaid has remained the same. Furthermore, the purchase of hessian, which is the subject matter of the demand in question has continued in the same organization, though under a different name. It is well settled that the provisions of a statute have to be construed with reference to the state of affairs as they existed at the time the statute was passed. In the year 1941 there was in existence the Supply Department of the Government of India which had incorporated the Indian Stores Department. According to the affidavit referred to above, the main activities of purchase of goods and commodities 1095 required by the Government of India 'and other governments, local bodies, etc., except for purchases of small values, that is to say, not exceeding Rs. 100 in each case and of certain specified commodities, like foodstuffs, forage, lethal stores, etc. referred to in para. 7 of the affidavit (at p. 18 of the supplementary paper book) were carried on by the Supply Department. That is the reason why the exemption to the Government of India was worded as it stands in section 5(2) (a) (iii). As stated above, the Supply De partment existed as a separate department up to the 6th January 1946. With effect from the 7th January the Department of Industries & Supplies came into existence which later was re designated as the Ministry of Industry & Supply. The judgment under appeal is based chiefly on the consideration that the exemption clause in question does not in terms refer to the newly created department which now goes by the name of the Ministry of Industry & Supply. But this department in so far as it deals with industry, is not concerned with the main purchasing activities of the Government of India. The exemption was granted in respect of the purchasing activity of the Government of India and that function continues to be assigned to the Supply Department which has now become a wing of the newly created department of the Government. The question therefore arises whether in those circumstances the Government of India could claim the benefit of the exemption. The High Court in answering that question in the negative has gone upon mere nomenclature. It has emphasized the change in the name and overlooked the substance of the matter. After all, what is a Department of a Government? It is not a mere name, whatever else it may be. It is not a person, either natural or artificial. A Department of Government is a particular function. The Government has so many functions and each of its functions or a group of functions is placed in charge of a particular Department which may be made up of a number of clerks organized in a group, whose work is supervised by a hierarchy of officials with 1096 the head of the department at the apex. A department may therefore consist of a single function out of the many functions of the Government, or it may comprise several functions placed in charge of a single departmental head. The Indian Stores Department which came to be incorporated in the Supply Department of the Government of India and later merged in the larger Department of the Ministry of Industry & Supply, could have continued its separate existence as it did until 1939 or could have become part of a larger department as it did after the 3rd August 1940, or the 7th January 1946, or the 29th August 1947; and conversely, its activities could be split up into a number of sub departments under different heads classified according to the nature of the commodities to be purchased. But, in my opinion, the change in the nomenclature in either direction should not matter so long as the function, namely, of purchasing articles and commodities required by the Government of India and other Governments continued to be the same. It is a matter of substance and not of form. The Department concerned cannot be equated with a natural person. Nor can it be raised to the level of a legal person. I am not aware of any principle of jurisprudence which would justify placing a department of Government on the pedestal of a legal person. There is no tertium quid between the two positions. Though the High Court has not said so in so many words, it has treated the department either as a legal person or as something in between a legal person and a natural person. That, in my opinion, is not sound logic. Nor is there any legal basis for treating a department of Government either as a legal person or as a natural person. In my view, the terms of section 5(2) (a) (iii) show that it was an exemption granted to a particular function of the Government of India described by a certain name. And one might feel inclined to exclaim with the great poet Shakespeare "What is in a name!" It is but a description of the main purchasing activity of the Government of India, as the history of the department above set out shows, 1097 Sometimes the language of a statute has to be construed in a modified form in order to give effect to the real intentions of the legislature where, as in the present case,, the language is only of a descriptive nature and not a definitive one. An instance of this is furnished by the case of Miller vs Salomons(1). In that case the question arose whether a person of Jewish persuasion who was returned to Parliament as a Member of the House of Commons was entitled to sit without taking the prescribed oath. The form of the oath as given by 6 Geo. 3, c. 53, mentioned the name of "King George" only. It was argued on behalf of that member that the oath was confined to the name of a sovereign who bore that name. But it was held by the Court that it was a mere description and that the intention of the statute was to include all sovereigns who came after King George 111. The relevant portion of the observations of the Court are in these terms: "The second question arising on the construction of the Act is, whether, as the form of the oath given by the 6 Geo. 3, c. 53, mentions the name of King George only, the obligation to administer it ceased with the reign of that Sovereign, because it was applicable to no other than to him. I think this argument cannot prevail. It is clear that the legislature meant the oath to be taken always thereafter, for the enactment is general that it shall be taken without limit of time and the oath is not confined to the existing monarch, but mentions 'the successors '; and as it could not be taken in those words during the reign of a Sovereign not of the name of George, it follows that the name George is merely used by way of designating the existing Sovereign; and the oath must be altered from time to time in the name of the Sovereign, in the manner it was when actually administered in this case, in order to carry the obvious meaning of the enactment into effect. This is an instance in which the language of the legislature must be modified, in order to avoid absurdity and inconsistency with its manifest intentions". (1) [1852] 7 Exchequer 475; ; , 1068. 1098 The High Court referred to the observation of Lord Halsbury in the case Of Commissioners of Inland Revenue vs Forrest(1) to the effect that exemptions from taxation should be strictly construed because otherwise the burden of taxation will fall on other members of the community. Those observations, in my opinion, have no relevance to the facts and circumstances of the present controversy, because we know that the exemption was granted to the Government of India in the department dealing with purchase of certain commodities and articles without reference to quantity. As already pointed out, the Indian Stores Department was concerned with purchase of stores for public services on behalf of all Central Departments of Government and local Governments, etc., and the Government of Bengal as then constituted was one of the Provinces of India which have been receiving subsidies and subventions to make up the deficit in their budgets. As a matter of fact, as stated on behalf of the Bengal Government the concession was granted in order to enable business communities within the Province of Bengal to compete on favourable terms with others outside Bengal in the matter of supplying the needs of the Government. Hence there is no question of liberal construction of the exemption resulting in throwing a greater burden on other citizens. On the other hand, the larger the sales in the Province of Bengal as it used to be, the greater the benefit to the business community doing business within that Province. It was therefore stated at the Bar that though the present case involved taxes amounting to less than Rs. 10,000, the question arising for determination in this case affected much larger amounts because such sales within the Province amounted to several crores. I should have thought that the business community in the Province of Bengal having had the advantage of the transactions of sale, the Government of Bengal in all fairness should have allowed the purchasing agency of the Government of India the benefit of the exemption until that benefit was in (1) ; 1099 terms withdrawn some time in the beginning of 1949. The matter can be looked at from another point of view also. We are concerned here with the sale of hessian. As pointed out in the affidavit filed on behalf of the Government of India, the purchase of hessian has all along been the concern of the Supply Department, now incorporated in the Ministry of Industry & Supply. Sales tax is a tax on sale of goods and tax on hessians falls within the contemplation of the law granting the exemption if the sales were effected through the purchasing agency of the Government of India. The beneficiary certainly was not an amorphous body like a department but the Government of India, because it is the Government of India which could be a unit for purposes of the Act. In this connection our attention was invited to the last clause of the exemption covered by the words "and any Railway or water transport administration". The argument was that if the Government of India as such was to be the beneficiary, then there was no necessity for the words just quoted. But this argument overlooks the fact that a railway or a water transport administration need not necessarily be a department of Government because there were, and still are, railway systems or water transport systems which are owned and administered by corporate bodies other than the Government of India. Sales even to those public or semi public bodies were within the terms of the exemption. Those words therefore are not words of limitation but words which widen the scope of the exemption in so far as the same may be available to railways and water transport administrations not owned and carried on by the Government of India. Another reason which may be adduced in answer to the contention that there was nothing to prevent the Legislature from stating that the exemption was granted in respect of all purchases by the Government of India is that the Indian Stores Department and its later substitutes had to make purchases Dot only for the Government of India but also for local governments and other public bodies. Hence the exemption 1100 in the terms in which it occurs in section 5 (2) (a)(iii) was not an exemption in favour of the Government of India only but also to other Governments and public bodies which could avail themselves of the facility of purchase through that department. Another argument was urged to meet the appellant 's case that really the exemption was meant for the Government of India in its function of purchase of stores and commodities, discharged through the Indian Stores Department and later through the Supply Department. It was argued that if the legislature meant to grant the exemption to the Government of India, then the easiest thing to do would have been to say that sales to the Government of India were exempt from the tax. But it has not been the contention of the appellant that all sales to the Government of India are within the terms of the exemption. Only the sales transacted through the purchasing department of the Government of India were so exempt. In para. 7 of the affidavit referred to above it has been stated on behalf of the Government that the different departments were entitled to make local purchases of small values, that is to say, not exceeding Rs. 100 and of certain specified commodities like foodstuffs which were not within the purchasing activity of the departments aforesaid of the Government of India. Hence, in my opinion, there is no validity in this argument either. It was also suggested during the argument that if the exemption were to be related to only such commodities and articles as were within the purview of the Stores Department and later of the Supply Department, then such an interpretation would involve addition of qualifying words to the section which is not ordinarily within the function of the courts. But, in my opinion, this argument also suffers from the infirmity that,it equates the departments mentioned in the exemption clause quoted above with a legal person, an argument which has already been dealt with. In my opinion, there is no escape from the conclusion that those are mere words of description and are not words with defined connotation, because 1101 neither the Act nor the rules framed thereunder define those departments. If the nomenclature only mattered, then there is no escape from the conclusion that whatever articles and commodities were purchased by the Indian Stores Department or its later substitutes, of whatever magnitude and value, would be within the mischief of the exemption clause in question. But that, in my opinion, was not the intention of the framers of the Act. They knew what the activities of the Government through those departments were and the exemption was granted only in respect of those functions of the Government, as already indicated. For the aforesaid reasons I would allow these appeals, set aside the orders of the Letters Patent Bench and restore the orders passed by the Single Judge of the Calcutta High Court, with costs throughout. BY THE COURT. In accordance with the Judgment of the majority the appeals are dismissed with costs.

Per section R. DAS, ACTING C.j., VIVIAN BOSE, BHAGWATI AND JAGANNADHADAS JJ., SINHA J. dissenting. The exemption created by the provisions of section 5(2)(a)(iii) of the Bengal Finance (Sales Tax) Act of 1941 must be construed strictly and cannot be extended to sales to Government departments other than those mentioned therein. The Department of Industries and Supplies, which was subse quently redesignated as the Ministry of Industries and Supplies, was not the same as the Indian Stores Department or the Supply Department of the Government of India and, consequently, sales made to the Ministry of Industries and Supplies are not exempt from payment of sales tax under that section. In a welfare State with ever expanding activities in different fields including trade and commerce, Government departments are often entrusted with the performance of well defined activities and are authorised to deal with the outside world and enter into transactions in the same way as an ordinary person or a Company may do and may well be regarded as distinct units or quasi legal entities for the purpose for which they are created. Consequently, the sales of hessian made to the Ministry of Industries and Supplies of the Government of India by the appellant Mills were not exempt from payment of sales tax under the Act and the State of West Bengal was entitled to levy the same. 1077 Per SINHA J. The language of a statute has sometimes to be construed in a modified form in order to give effect to the real intentions of the legislature where, as in the present case, the language is only of a descriptive nature and not a definitive one. Miller vs Salomons ([1852] 7 Exchequer 475), referred to. Commissioners of Inland Revenue vs Forrest ([1890] 15 A. C. 334), held inapplicable. The terms of section 5(2)(a)(iii) indicate that the exemption created attaches to a particular function of the Government of India described by a certain name. The change of nomenclature was, therefore, of no consequence so long as a particular department continued to discharge that function, namely, that of purchasing articles including hessian for the Government of India. History of the department shows that the Ministry of Industry and Supply is a lineal descendant of the Indian Stores Department and was at the time of the contract discharging its function on behalf of the Government of India and, consequently, the sales made to it must be held to be exempt from payment of sales tax. A department of the Government is neither a natural nor a legal person but is one of the many functions of a Government placed in charge of a hierarchy of officials with the head of the department at the apex.

Appeal No. 287 of 1967. Appeal from the judgment and order dated May 29, 1964 of the Punjab High Court in Civil Writ No. 1609 of 1961. Harbans Singh and R. N. Sachthey, for the appellants. The Judgment of the Court was delivered by Shah, J. The respondents Joint Stock Company has its principal place of business in Bombay, and a branch office in New Delhi. The Assessing Authority, Karnal, exercising power under the Punjab Professions, Trades, Callings and Employments Taxation Act 7 of 1956, assessed the respondent to, profession tax 537 for the years 1960 61 and 1961 62 and issued a notice of demand for the amount so assessed. The High Court of Punjab quashed the notices of demand and the assessment orders holding that the respondent did not carry on trade within the State of Punjab and was not liable to be assessed to tax under the Act. The State of Punjab has appealed to this Court against the order of the High Court. Section 3 of Act 7 of 1956 provides "Every person who carries on trade, either by himself or by an agent or representative, or who follows a profession or calling or who is in employment, either wholly or in part, within the State of Punjab, shall be liable to pay for each financial year or a part thereof a tax in respect of such profession, trade, calling or employment. Provided . . . The respondent, it is common ground, has no branch office or any other place of business in the State of Punjab. It has also not appointed any agent or representative to carry on business on its behalf within the State. The respondent supplies goods to the Government of Punjab and certain "semi Government bodies" in the State in execution of orders received at its branch office at Delhi. The goods are despatched from Delhi by rail or by public motor transport. Pursuant to the terms and conditions of the "Rate Contract" between the respondent and the Controller of Stores for the State of Punjab, the respondent consigns the goods sold by it to the appropriate Government Department F.O.R. des tination. Inspection of the goods is made within the State of Punjab. The price for the goods sold is collected by presenting bills or railway receipts through Banks to the consignees. The Assessing Authority held that the respondent "may rea sonably be regarded as selling goods within" the State of Punjab because it was supplying goods F.O.R. destination. The High Court held that the respondent could not in law be regarded as carrying, on trade at the place at which the goods were supplied, merely because the railway or other receipts were taken out in the name of the respondent and presented to the purchasers duly endorsed in their favour to secure realization of the price of the goods. Liability to pay tax under Act 7 of 1956 arises if a person carries on trade by himself, or through his agent, or follows a profession or is in employment within the State, and not otherwise. The expression "trade" is not defined in the Act. "Trade" in its primary meaning is the exchanging of goods for goods or goods for money; in its secondary meaning it is repeated activity in the 538 nature of business carried on with a profit motive, the activity being manual or mercantile, as distinguished from the liberal arts or learned professions or agriculture. The question whether trade is carried on by a person at a given place must be determined on a consideration of all the circumstances. No test or set of tests which is or are decisive for all cases can be evolved for determining whether a person carries on trade at a particular, place. The question, though one of mixed law and fact, must in each case be determined on a consideration of the nature of the trade, the various steps taken for carrying on the trade and other relevant facts. In the present case, the respondent has no shop or office within the State of Punjab. The respondent supplies goods within the State pursuant to orders received and accepted at New Delhi, and also receives price for the goods within the State. But these are ancillary activities and do not in our judgment amount to carrying on trade within the State of Punjab. We need not refer in detail to cases such as Grainger and Son vs Gough (Surveyor of Taxes) (1); F. L. Smith & Co. vs F. Greenwood (Surveyor of Taxes)(2); and Firestone Tyre Co. Ltd vs Lewellin, (3) which interpret the expression "trade exercised within the United Kingdom" in the English Income Tax Acts, for they merely lay down that for the purpose of the Income Tax Acts, there is no single, decisive or "crucial" test to determine whether the tax payer exercises trade at a given place. The appeal fails and is dismissed. The respondent has not appeared at the hearing. There will, therefore, be no order as to ,costs.

The respondent a Joint Stock Company, having no shop or office or agent within the State of Punjab, used to supply goods within the State pursuant to orders received and accepted at New Delhi, and also used to receive the price for the goods within the State. The Assessing Authority, Kamal, assessed the respondent to profession tax under the Punjab Professions, Trades, Callings and Employments Taxation Act, 1956. The order was quashed by the High Court. In appeal to this Court, HELD : The activities of the respondent in the State were mere ancillary activities and did not amount to carrying on trade within the State. [538 C D] The expression "trade" is not defined in the Act. "Trade" in its primary meaning is the exchanging of goods for goods or goods for money; in its secondary meaning it is repeated activity in the nature of business carried oh with a profit motive, the activity being manual or mercantile, as distinguished from the liberal arts or learned professions or agriculture. The question whether trade is carried on by a person at a given place, though one of mixed law and fact, must in each case be determined on a consideration of the nature of the trade, the various steps taken for carrying on the trade and other relevant facts. [537 H 538 E] Grainger and Son vs Gough (Surveyor of Taxes) , F.L. Smith & Co. vs F. Greenwood (Survevor of Taxes), 8 T.C. 193 and Firestone Tyre Co. Ltd. vs Lewellin, distinguished.

l Leave petition (c) No. 4748 of 1991. From the Judgment and Order dated 21.1.91 of the Bombay High Court in W.P. No. 3481 of 1990. N.B. Shetye, P.M. Pradhan and A.M. khanwilkar for the petitioner. Dushyant Dave, Beliram Vakil, Abrar Ali, Ajit Yogi, Gajender Lal, Mukul Gupta and Ms. Sonia Khan for the Respondents. The Judgment of the court was delivered by SAWANT, J. The petitioner is diploma holder in Engineering and holds the post of Executive Engineer in the respondent Corporation. Till 1974, the promotion post of the superintending Engineer was available both for diploma holders and degree holders according to merit cum seniority. This was so according to the practice followed by the Corporation without making any rules or regulation in that behalf. In 1974, the corporation made regulation by passing a resolution by passing a resolution and continued the same practice. Admittedly, the regulation were not made under section 64 of the Maharashtra Industrial Development Act, 1961 [hereinafter referred to as the 'Act '] under which the respondent corporation was created. Thereafter in 1988, the corporation passed a resolution, for the first time,. making 75 per cent of the posts of superintending engineers available to the executive Engineers holding degrees and 25 per cent to the Executive Engineers who were diploma holders. This resolution was also admittedly not a regulation made under the said section 64. But for this resolution, the petitioner who was senior to respondent NO. 2 would have been promoted to the post of Superintending Engineer on 31st October, 1990. However, since respondent No.2 was a degree holder, he got the said resolution and was promoted to the said post on that date. It is this promotion which was challenged by the petitioner by a writ petition in the High Court. The High Court by the impugned judgment dismissed the said petition. Two contentions were raised before us. (i) that no classification could be made among the Executive Engineers on the basis of their educational qualification for the purpose of promotion to the post of superintending Engineer, since they belong to the same cadre of Executive Engineers and do the same work. There was also a common seniority of the Executive Engineers maintained. hence the classification was discriminatory in nature and violative of Articles 14 and 16 of the Constitution . (ii) that if at all such a discrimination was permissible, it could be made only be a statutory rule or regulation framed under Section 64 of the said Act. A mere resolution or an executive instruction could not effect such discrimination. We find not merit in either of the two contentions. It is now well settled that for the purpose of promotion, a valid classification can made among the members holding the same post on the basis of their qualification. In state of Jummu & Kashmir vs Triloki Nath Khosa & Ors., ; , a Constitution Bench of his court has clearly held that such a classification is permissible and does not violate Articles 14 and 16 of the Constitution the Court has observed there that in state of Mysore & Anr. vs P. Narasing Rao, ; and The Union of India and others vs Dr.(Mrs.) S.B. Kholi; , , it was already held that classification on the basis of educational qualification was permissible. The Court then referred to Roshan Lal Tandon vs Union of India, ; and distinguished it on the facts by pointing out that it was a case of the direct recruits and promotees integrated into one cadre. Once they were integrated they lost their birth birth marks, viz. the different sources from which they were recruited. [Emphasis supplied]. The court pointed out that Roshan Lal 's case [supra] was thus no authority for the proposition that if direct recruits and promotees are integrated into one class they cannot be classified for purposed of promotion on a basis other than that in the case before the them the classified for purpose of promotion on a basis other than that they were drawn from different sources. The court also pointed out that the very Bench which decided Roshan Lal 's case [supra] held about a fortnight later in Narsingh Rao 's case [supra t] that higher educational qualifications were a relevant consideration for fixing higher pay scale and , therefore, matriculates Tracers could be given a higher scale than non matriculate Tracers thought their duties were identical . The court, further on the same reasoning distinguished Mervyn Coutindo & Ors. Collector of Customs Bombay & Ors.,[1966] 3 SCR 600 and S.M. Pandit and others, etc. vs state of Gujarat and others, AIR 1972 SC 252 by pointing out that both the cases related to the classification made on the basis of the sources of recruitment and not on the basis of educations. The court then concluded : "We are therefore of the opinion that though persons appointed directly and by promotion were integrated into a common class of Assistant Engineers, they could, for purposes of promotion to the cadre of Executive Engineers, be classified on the basis of educational qualification. The rule providing that graduates shall be eligible for such promotion to the exclusion of diploma holders does not violate Articles 14 and 16 of the Constitution and must be upheld. " The reliance placed by Shri Shetye appearing for the petitioner on a later decision of a Bench of two learned judges of this Court in H.C. Sharma and others vs Municipal Corporation of Delhi and others; , 372 is, we are afraid, not justified. It was a case where no separate quota for promotion to the post of Assistant Engineer was kept for degree holder Junior Engineers and diploma holder Junior Engineers. The degree holders Junior Engineers had sought a relief that such a quota be kept. It is while dealing with this relief claimed, that this Court had observed that it could not be don e except by carving out two classes in the same category of junior Engineers. It may be observed that it was not a case where the classification was already made which was challenged before the Court. It was case where the writ petitioners wanted such a classification to be made. It is for the authorities if they so desire, taking into consideration the nature of work, the requisite qualification for the work and the necessity for making such a classification that quotas could be prescribed on the basis of educations. It is true that the following observation made in that case while dealing with the relief claimed, do support the petitioner: " Prayer No. 4 is to declare the petitioner Graduate Engineers as a separate category amongst Junior Engineers and give them equal quota like the Diploma holder Junior Engineer`s out of the 50% quota for promotion a Assistant Engineers. This cannot be done except by carving out two classes in the same category of Junior Engineers o the basis merely of their qualification which is not permissible in law though the creation of selection grade in the same category on the basis of merit and on seniority is well known and permissible. The Junior Engineers do the same kind of work and bear the same responsibility whatever their qualification, whether they are Degree holders or Diploma holders. " However , these observations have been made without noticing the decision in Khosa 's case (supra). Hence, the observation are per incuriam as regards the next contention, admittedly neither the practice followed till 1988, nor the resolution passed by the respondent Corporation in 1988 nor the resolution passed in accordance with section 64 of the Act. It is well settled that in the absence of rule or regulation the authority can prescribe service conditions by executive instructions and this is what was done till the year 1988 and is also sought to be done since 1988 by the impugned resolution. The proposition that in the absence of the rules and regulations, the authority can act by executive instruction finds direct support in Mysore state Road Transport Corporation vs Gopinath Gundachar char, {1968] 1 SCR 767 and vs Balasubramaniam and others vs Tamil Nadu housing Board and others; , In view of the above, the petition stands dismissed. G.N Petition dismissed.

The petitioner, a diploma holders in Engineering, was Executive Engineer in the respondent Corporation. He would have been promoted as superintending Engineer, but for a Resolution passed in 1988 making 75% of the posts of Superintending Engineers available to Executive Engineers with diploma in Engineering degrees and 25% to Executive Engineers with diploma in Engineering Respondent No.2 who junior to petitioner but had engineering degree was promoted as superintending Engineer. The petitioner challenged the promotion of Respondent No. 2 before the High court by way of a writ petition. The High court having dismissed the same, the petitioner preferred the present special Leave petition. On behalf of the petitioner, it was contended that since there was a common seniority list of Executive Engineers, any classification on the basis of education qualification was discriminatory and violative of Articles 14 and 16 of the Constitution; and that in the absence of any statutory rule or regulation, a mere resolution could not effect such discrimination. Dismissing the petition, this court, HELD: 1.1. It is now well settled that for the purpose of promotion, a valid classification can be made among the members holding the same post on the basis of their qualification. Such a classification is permissible and does not violate Articles 14 and 16 of the Constitution. [99 A B] 1.2. It is for the authorities if they so desire, taking into consideration the nature of work, the requisite qualification for the work, and the necessity for making a classification, to prescribe quotas on the basis of educational qualification. [99 D] State of Jammu & Kashmir vs Triloki Nath Khosa & ors., [1974]1 SCR 771, followed. H.C. Sharma & ors. vs municipal corporation of Delhi & ors. ; , , referred to. In the instant case, admittedly neither the practice followed till 1988, nor the resolution passed by the respondent Corporation in 1988 was a regulation passed in accordance with section 64 of the Act. However, it is well settled that in the absence of a rule or regulation, the authority can prescribe service conditions by executive instructions and this is what was done till year 1988 and is also sought to be done since 1988 by the resolution under challenge. [100 A,B] Mysore state Road Transport Corporation vs Gopinath Gundachar char; , and V. Balasubramaniam and others vs Tamil Nadu Housing Board and others, [1987]4 SCC 738, relied on.

Civil Appeal No. 1801 of 1974. From the Judgment and Order ,dated 20.3.1974 of the Karnataka High Court in W.P. No. 1956 of 1971. R.N. Narasimhmurthy, Novin Singh and M. Veerappa for the Appellants. The appeal is by special leave. Challenge is to the Judgment. ,of the Karnataka .High Court declaring Rule 8(1) of the Karnataka Excise (Sale of Indian & Foreign Liquors) Rules, 1968 in so far as it relates to levy of licence fee for retail vending of authorised India and foreign liquors and directing refund of such levy col lected within three years prior 2.8.1971 when the Writ Petition was filed. Respondent, an excise contractor, had taken in auction the exclusive privilege tosell liquors in retail at an approved shop premises. 'He was issued the appropriate licence under the provisions of the law on payment of licence fee in terms of Item 2 of Rule 8(1) of the aforesaid Rules. Respondent filed a writ petition before the Karnataka High Court chal lenging the vires of section 23(d) of the Mysore Excise Act, 1965 (hereafter 'Act ' for short) and Rule 8(1.) as being beyond the legislative competence of,the State Legislature. The High Court did not accept the contention of the respondent in 'regard to section 23 but held that Rule 8(1) authorising the 'levy of a licence fee for the retail off shop was without authority of law. Section 23(d), as far as relevant, provides: "23. Ways of levying such duties Subject to such Rules regulating the time, place and manner, as may be prescribed, excise duty and countervailing duty under section 22 shall be levied in one or more of the follow ing ways, as may be prescribed, namely: 702 (a) . . . (aa) . . . . (b) . . . . . (c). . . . . (d)by fees on licences in respect of manufacture or sale of any excisable articles. " Rule 8 made the rule making powers, under the Act, interalia, provides: "8. Fee to be paid (1) The licence fee for the several kinds of licences shall be as follows, namely: (1) . . . . . (2). . . . . (3) . . . . The High Court rightly did not accept the challenge to section 23(d) of the Act. What is authorised under section 23(d) is imposition of a fee of licence in respect of manufacture or sale of any excisable articles. Rule 8(1) has obviously gone beyond the enabling provision in the section by requir ing a licence fee to be paid for the premises where the licence shop is located. Such a fee would not have the support of section 23(d). It is unnecessary to refer to prece dents for support for this conclusion. It may be possible for the Legislature to make a statutory provision for a licence fee of the type contemplated under the Rules but without authority of the statute a rule of the type impugned should not have been made. We find no merit in this appeal and it is, therefore, diismissed. fore, dismissed. Respondent did not appear inspite of service of appeal notice. We make no of for costs. G.N. Appeal dismissed.

The Respondent, a licencee under floe Karnataka Excise Act for selling liquor at an approved shop, flied a Writ Peti tion before the High Court challenging the vires of Section 23(d) of the Mysore Excise Act, 1965 and Rule 8(1) of the Karnataka Excise (Sale of Indian and Foreign Liquors) Rules, 1968 as being beyond the legislative competence of the State. The High Court negatived the contention of the Respond ent in respect of Section 23(d) of the Act but held that Rule 8(1) authorising tihe levy of licence fee for retail shop was without authority of law and dircted refund of the levy collected for three years prior to the filing of tiWrit Petition. Aggrieved by the High Court 's decision, the appellant State has preferred the present appeal by special leave. Dismissing the appeal, this Court, HELD: The High Court rightly did not accept the chal lenge to Section 23(d) of the Mysore Excise Act, 1965. What is authorised under Section 23(d) is imposition of a fee of licence in respect of manufacture or sale of any excisable articles. Rule 8(1) of the Karnataka Excise (Sale of Iadion & Foreign Liquors) Rules, 1968 has obviously gone beyond the enabling provision in the section by requiring a licence fee to be paid for the premises where the licensed shop is located. Such a fee would not have the support of Section 23(d). It is unnecessary to refer to precedents for support for this conclusion. It may be possible for the Legisla 701 ture to make a statutory provision for a liicence fee of the type contemplated under the Rules but without authority of the statute a rule of this type should not have been made. [702E F]

Appeal No. 280 of 1961. Appeal by special leave from the judgment and order dated August 2, 1960, of the Rajasthan High Court in D. E. Civil Misc. (Election) Appeal, No. 1 of 1960. G.S. Pathak, A. V. Viswanatha Sastri, section N. Andley and P. L. Vohra, for the appellant. G. C. Mathur, for the respondent No. 2. 1962. February 8. This appeal by special leave arises out of an election petition filed by the appellant challenging the validity of the election of respondent No. 1, Lal Singh on several grounds. The appellant is an elector in the Chittorgarh Constituency and the election which led to the present petition was held in March. 1957, for the Rajasthan Legislative Assembly from the said constituency. As a result of the election, respondent No. 1 was declared to have been duly elected on the 11th March, 1957. He secured 7272 votes whereas respondent No. 2 Laxman Singh s/o Maharawal Sir Bijey Singh secured 7261 votes and respondent No. 3 Chhoga lal secured 569 votes. The appellant 's case was that respondent No. 1 's election wag invalid inasmuch as he had practiced corrupt practices at the said election. According to the appellant, respondent No. 1 procured or abetted or attempted to procure either by himself or by his agents or by other persons with his connivance or that of his agents the reception of invalid votes and as a result of the said votes, the result of the Election had been materially affected The appellant stated in detail the manner in which the said invalid votes bad been procured. The appellant further pleaded that respondent No. 1, his agents and other persons with the connivance of respondent No. 1 or that of his agents published such 116 statements of facts (Exts. 3 & 6) which were false and which they either believed to be false or did not believe to "be true, in relation to the personal character or conduct of respondent No.2 which were likely to prejudice the prospect of respondent No. 2 at the election. It is on these two grounds that the appellant claimed a declaration that the election of respondent No. 1 was invalid. He also claimed that respondent No. 2 should be declared to have been validly elected. Respondent No. 2 filed his written statement supporting the petition but he did not appear before the Tribunal at the hearing. Respondent No. 3 did not appear at all, while respondent No. 1 denied all the allegations made by the appellant and contended that the election petition filed by the appellant should be dismissed. On the pleadings of the parties, the Election Tribunal framed as many as 26 issues. In substance it held that the several allegations made by the appellant in respect of the receipt of invalid votes bad not been proved and so the first ground on which respondent No. 1 's election was challenged by appellant, could not succeed. In regard to the second ground on which respondent No. 1 's election was challenged by the appellant, the Tribunal held that Ext. 3 had been published by the agent of respondent No. 1 but not with his express consent and in regard to Ext. 6, the Tribunal was not satisfied that, it had been published by respondent No. 1 's agent. That is how even the second ground made by the appellant disputing the validity of respondent No. 1 's election did not succeed. In the result, the election petition was dismissed. Against the said decision, the appellant preferred an appeal in the Rajasthan High Court. The High Court confirmed the finding of the Tribunal on the first point in regard to the receipt of invalid votes. It is true that the High Court was not 117 satisfied with the approach adopted by the Tribunal in dealing with this part of the case and it thought that some of the reasons given by the Tribunal in support of its conclusions were not satisfactory. Even, so, the High Court felt that the final conclusion of the Tribunal was, on the whole, correct and need not be reversed. Thus both the Tribunal and the High Court have recorded findings against the appellant on the first part of his case. In regard to the second contention raised by the appellant, the High Court has accepted the finding of the Tribunal about the publication of Ext. In regard to the other document Ext. 6, the High Court has reversed the conclusion of the Tribunal and hold that the said document had been published for the benefit of respondent No. 1 and differing from the view taken by the Tribunal, the High Court has hold that the Publication of both the pamphlets was with consent of respondent No. 1 and so was outside the purview of section 100(2) of the Representation of the People Act 1951 (43 of 1951) (hereinafter called the Act). Having thus found that the two pamphlets had been published by the agent of respondent No.1 and with his consent, the High Court preceded to examine the question as to whether the material allegations made against respondent No. 2 by the said pamphlets were true or false. The High Court bold that the said material allegations were false and it came to the conclusion that they were calculated to effect prejudicially the prospects of the election of respondent No.2. The High Court was however, not satisfied that the said allegations had relation to the personal character or conduct of respondent No. 2 and so it held that the corrupt practice alleged by the appellant against respondent No. 2 on the strength of the said two pamphlets under section 123(4) of the act had not been proved. , The result was that though the High Court differed from the Election Tribunal in regard to some of the findings recorded 118 by the Tribunal on the second ground, its ultimate conclusion was the same as that of the Tribunal. The appeal preferred by the appellant was accordingly dismissed. It is against this order that the appellant has come to this Court by Special leave. In this appeal, the only question which we are called upon to consider is whether the two pamphlets justify the contention of the appellant that respondent No. 1 has committed a corrupt practice under section 153(4). The question as to whether respondent No. 1 's election has been materially assisted by the receipt of invalid votes, is concluded by concurrent finding of ' fact recorded against the appellant and so we have not allowed Mr. Sastri to dispute the correctness of that finding. Before dealing with the short point raised for our decision under section 123(4) of the Act, it is necessary to set out the material portion of the pamphlets on which the appellant 's case of corrupt practice is based. The relevant portion in the pamphlet Ext. 3 to which objection is taken by the appellant reads thus . (1) Enemy of Democracy? (2) Agent of the foreigners strangling the freedom of Bharat? (3) Supporter and collaborator of the conspiracy of Pakistani attack on Bharat? (4) Bringer of tyrannical rule of Rajas in Rajasthan? (5) Destroyer of Hindu Muslim unity by raising the slogan of Ram Rajya? (6) Purchaser of the opponents of the Congress by means of Money? 119 "Maharawal of Dangarpur, Shri Laxman Singh, who was defeated in the last election by thousands of votes, has come to mislead the people of Chittor, has come to push back the backward district of Chittor by 100 years, has come to destroy the peace and tranquility of Chittor under cover of communal organisation, has come to provide means to the public to spend their hard earned money on drinking orgies, has come to intensify again the tyranny of Raja Maharajas in Rajasthan, has come to make a gift of Kashmir to the aggressor Pakistan, has come to enslave India again by collaborating with Pakistan and Pakistan 's friends. He is a friend of Raja Maharajas and an enemy of cultivators and laborers. He wants to grant land to Bhooswamis and thereby oust the cultivators and wants to establish once more his pagent by exploitation of the hard labour of cultivators. " The other pamphlet contains substantially the same portion and so it need not be reproduced. It is urged for the appellant that in describing respondent No. 2 as the agent of foreigners strangling the freedom of Bharat. the personal character of respondent No. 2 has been falsely and adversely criticised. The same comment is made in respect of the description of respondent No. 2 as the supporter and collaborator of the conspiracy of Pakistani attack on Bharat and in support of this argument, reliance has been placed on the further statement in the pamphlet that respondent No. 2 had come to make a gift of Kashmir to the aggressor Pakistan and had come to enslave India by collaborating with Pakistan and Pakistan 's friends. It is also argued that describing respondent No. 2 as the purchaser of the opponents of the Congress by means of money, attracts the provisions of 123 (4). It is mainly on these three allegations in the 120 pamphlet that the case of the appellant rests and the argument is that by making these allegations, the private character of respondent No. 2 has been falsely vilified and that the said vilification was reasonably calculated to prejudice the prospects of his election. On the other hand, for respondent No. 1 Mr. Mathur who appeared amicus curaie at our request has contended that the three allegations, though false, cannot be said to touch or effect the private character of respondent No. 2. He has argued that in dealing with section 123 (4), it is necessary to make a distinction between the personal or private character or conduct of a candidate and his public or political character. Mr. Mathur 's contention is that though the criticism made against respondent No. 2 by the impugned pamphlet may be extravagant, unreasonable. and false, it is nevertheless criticism made against him in his public and political character and as such, a. 123 (4) cannot be invoked. It is, therefore, necessary to determine the true scope and effect of the relevant provision in a. 123 (4). Section 123 deals with corrupt practices and amongst them, is the corrupt practice specified by subjection (4). That sub section reads thus : "The publication by a candidate or his agent or by any other person, 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, or withdrawal, or retirement from contest, of any candidate, being a statement reasonably calculated to prejudice the prospects of that candidates election. " It would thus be seen that the publication in question must be by a candidate or his agent or by any other person ; the said publication should be 121 in regard to a statement of fact which is false and which he either believes to be false or does not believe to be true ; that it must have relation to the personal character or conduct of the candidate, or should have relation to the candidature with drawl or retirement from contest of any candidate and that it should be a statement reasonably calculated to prejudice the prospects of that candidate 's election. All the requirements of this subsection, except one, are held to have been satisfied by the High Court. The only requirement of the sub section which has not been satisfied according to the High Court is that the statement has no relation to the personal character or conduct of respondent No. 2. Mr. Sastri contends that this finding of the High Court is erroneous in law. It would be noticed that in prescribing the requirement that the false statement should have relation to the personal character of the candidate, a distinction is intended to be drawn between the personal character of the candidate and his public or political character. The provision postulates that if a false statement is made in regard to the public or political character of the candidate, it would not constitute a corrupt practice even if it is likely to Prejudice the prospects of that candidate 's 'election. This assumption is presumably based on the theory that the electorate being politically educated and mature, would not be deceived by a false criticism against the public or political character of any candidate. The public and political character of a candidate in open to public view and public criticism and even if any false statements are made about the political views of a candidate or his public conduct or character, the electorate would be able to judge on the merits and may not be misled the allegations by any false allegations in that behalf. It is on this theory that false statements of fact effecting the public or political character of a candidate are not brought 122 within the mischief of sections 123(4). In order that the elections should be free, it is necessary that the electorate should be educated on political issues in a fearless manner and so, the Legislature thought that full and ample scope should be left for free and fearless criticism by candidates against the public and political character of their opponents. But the position with regard to the private or personal character of the candidate is very different. Circulation of false statements about the private or personal character of the candidate during the period preceding elections is likely to work against the freedom of election itself inasmuch as the effect created by false statements cannot be met by denials in proper time and so the Constituency has to be protected against the circulation of such false statements which are likely to effect the voting of the electors. That is why it is for the protection of the constituency against acts which would be fatal to the freedom of election that the statute provides for the inclusion of the circulation of false statements concerning the private character of a candidate amongst corrupt practices. Dissemination of false statements about the personal character of a candidate thus constitutes a corrupt practice. Though it is clear that the statute wants to make a broad distinction between public and political character on the one hand and private character on the other, it is obvious that a sharp and clear cut dividing line cannot be drawn to distinguish the one from the other, In discussing the distinction between the private character and the public character, sometimes reference is made to the " 'man beneath the politician" and it is said that if a statement of fact affects the man beneath the politician it touches private character and if it affects the politician. It does not touch his private character. There may be some false statements of fact which clearly affect the private character of 123 the candidate ; if, for instance, it is said that the candidate is a cheat or murderer there can be no doubt that the statement is in regard to his private character and conduct and so if the statement is shown to be false, it would undoubtedly be a corrupt practice Similarly, if the economic policy of the party to which the candidate belongs or its political ideology is falsely criticised and in strong words it is suggested that the said policy and ideology would cause the ruin of the country, that clearly would be criticism, though false, against the public character of the candidate and his political party and as such, it would be outside the purview of the statute. But there may be oases on the border line where the false statement may affect both the politician and the man beneath the politician and it is precisely in dealing with cases on the border line that difficulties are experienced in deter mining whether the impugned false statement constitutes a corrupt practice or not. If, for instance, it is said that in his public life, the candidate has utilised his position for the selfish purpose of securing jobs for his relations, it may be argued that it is criticism against the candidate in his public character and it may also be suggested that it nevertheless affects his private character. Therefore, it is clear that in dealing with corrupt practices alleged under is. 123(4) where we are concerned with border line cases, we will have to draw a working line to distinguish private character from public character and it may also have to be borne in mind that in some cases, the false statement may affect both the private and the public character as well. In the present case, we are satisfied that the allegation made in the pamphlet that respondent No. 2 is a purchaser of the opponents of the Congress by means of money clearly attracts the 124 provisions of sections 123(4). In plain terms, the statement amounts to an allegation that respondent No. 2 buys by offering bribes the votes of the opponents of ' the Congress. Bribery is itself a a corrupt practice and if it is said against a candidate that the practices the corrupt practice of buying the votes of the opponents of the Congress by means of bribery, that clearly and unequivocally affects his private character. Offering a bribe in an election introduces an element of moral turpitude and it cannot be denied that a person who offers bribe loses reputation as an individual in the eyes of the public. The statement alleges that the bribes are offered by respondent No. 2 for the pur pose of election and in that sense it may be that it is his public character which is falsely criticised. But,in our opinion, it would be idle to contend that it is a false statement only against the public character of respondent No. 2. Having regard to the moral turpitude involved in the offering of the bribe, the statement in question undoubtedly affects his private character as well. Unfortunately, in dealing with this point, the High Court does not appear to have considered this statement at all. It has dealt with this problem in very general terms. It has observed that the impugned statements all refer to the Maharawal as one of those various persons of his class who as a body appear to be responsible in the opinion of the writer for the political mischiefs referred to in the statements, land that a general reading of the document shows that the attack upon him is a part of a bigger Organisation of individuals who do not appear to be as the writer thinks, well inclined towards the progress of the country. It is perfectly true that in dealing with the contention that the false statement contained in the pamphlet amounts to a corrupt practice under as. 123(4), it is necessary to read the document as a whole before determining the effect of any particular objectionable statement. 125 But reading the document as a whole, we see no justification whatever for the view expressed by the High Court that the criticism made in the document is, directed against a body of persons and not against respondent No. 2 himself. The failure of the High Court to deal with the several specific statements on which the argument of the appellant is based, has introduced a serious infirmity in its final conclusion. If only the High Court had considered whether the allegation that respondent No. 2 was the purchaser of opponents of the Congress by means of money, we are inclined to think that the High Court would not have brushed aside. the appellant 's case with the general observations which it has made in its judgment. We are, therefore, satisfied that the appellant is right in contending that the false statement of fact to which we have just referred constitutes a corrupt practice under as. 123(4) of the Act. In that view of the matter, it is unnecessary to consider whether the other impugned statements of fact also ,attract the provisions of as. 123(4). In the result we must reverse the finding of the High Court that publication of the impugned pamphlets does not constitute a corrupt practice under as. 123(4). The result of this conclusion inevitably is that the election of respondent No. 1 must be declared to be invalid because there is no doubt that the corrupt practice proved in this case falls under section 191(b) and is outside the purview of section 100(2). That takes to us the question as to whether respondent No. 2 can be declared to have been validly elected at the election in question. This question will have to be decided in the light of provisions of section 101(b) of the Act. The said section provides, inter alia, that " 'if any person who has lodged a petition has, in addition to calling in question the election. of the returned candidate, 126 claimed a declaration that any other candidate has been duly elected and the Tribunal is of opinion that but for the votes obtained by such returned candidate by corrupt practices such other candidate would have obtained a majority of the valid votes, the Tribunal shall after declaring the election of the returned candidate to be void declare such other candidate to have been duly elected. " This question has not been considered by the High Court and it cannot be decided unless the relevant facts are examined on the merits and that normally would mean our remanding the case to the High Court for the decision of the point in accordance with law. We do not, however, propose to adopt such a course in view of the fact that it would be futile to give any further 'lease of life to this petition. The election which is challenged took place in 1957 and in fact we are now on the verge of fresh elections which would take place this month That is why we think it would serve no purpose in sending the matter back for the decision of the question as to whether on the evidence adduced in the case, respondent No. 2 can be declared to have been validly elected. The result is, the appeal is allowed and the election of respondent No. 1 is get aside. Since respondent No. 1 did not appear, there would be no order as to costs. Appeal allowed.

Respondent 1 was declared elected to the Legislative Assembly. His election was challenged, inter alia, on the ground that he had committed the corrupt practice under section 123 (4) of the Representation of People Act, 1951 of making false statements in relation to the personal character or conduct of Respondent 2, a defeated candidate The statements were contained in a pamphlet issued by the agent of Respondent 1 with his consent. Among other statements the pamphlet contained a false statement that the Respondent 2 wits "purchaser of the opponents of the Congress by means (if money". Respondent 1 contended that the statement related to the public or political character of Respondent 2 and not to his private character and did not fall within take mischief of section 123 (4). Held, that the statement related to the personal character of Respondent 2 and Respondent 1 was guilty of the corrupt practice under section 123 (4) of the Act. The offending statement amounted to an allegation that Respondent 2 bought the votes of the opponents of the Congress by offering bribes. Bribery was itself a corrupt practice and an allegation of bribery involved moral turpitude and clearly and unequivocally affected the private character of Respondent 2. 115

Civil Appeal No.951 of 1977. From the Judgment and Order dated 29.7.1976 of the Madras High Court in S.A. No.89 of 1972. A.T.M. Sampath and P.N.Ramalingam for the Appellant. S.Balakrishnan and S.Prasad for the Respondent. The Judgment of the Court was delivered by THOMMEN, J. The appellant is the defendant in a suit insti 392 tuted by the respondent to set aside a transfer of property made by the guardian of a minor and for recovery of possession of the property. The suit was decreed, and the decree was confirmed by the first appellate court as well as by the High Court. The plaintiff respondent purchased the suit property from an ex minor within three years after the minor attained majority. During his minority, the property was sold by his father as his natural guardian to a person from whom the present appellant purchased the property. All the courts found that the guardian had not obtained the permission of the Court for the sale of the property, as required by section 8 of the Hindu Minority & Guardianship Act, 1956 ("the Guardianship Act") and that the sale of the property was not for legal necessity. Dismissing the second appeal, the High Court held that the suit was rightly instituted by the respondent as a transferee from the ex minor within three years after the minor attained majority and that the contention of the defendant that the suit by a transferee from the ex minor was hit by section 6(e) of the was unsustainable. The only question which arises in the present appeal, as it did before the High Court, is (to quote the words of the High Court) "Whether a transferee from a minor after he attained majority, can file a suit to set aside the alienation made by the minor 's guardian or the said right is one to be exercised only by the minor?". The relevant facts are that the suit property belonged to one Veerammal. She had a daughter by name Kaliammal. Veerammal died shortly after she purchased the property in 1948. She left behind her husband Kandayya and their duaghter Kaliammal. Subsequently, Kandayya married a second time when his daughter Kaliammal was a minor. She thereupon left her father 's house and resided with her maternal grand father who protected and maintained her. During her minority, Kandayya sold the property on 29.10.1959 to Jainulavudeen. On 25.4.1966, Jainulavudeen in turn sold the property to the defendant appellant. Subsequently, on 26.5.1966 the plaintiff obtained a deed of sale of the suit property in his favour from Kaliammal who had by then attained majority. The Plaintiff thereafter instituted the present suit (O.S. No. 491 of 1968) against the appellant to set aside the transfer of property made by Kandayya and for recovery of its possession. 393 The question is whether the respondent in his capacity as a transferee from the ex minor was competent to bring a suit to set aside the sale effected by the minor 's guardian. It is no longer disputed that the suit was brought within three years after the minor attained majority. Nor is it any longer contended that the father of the minor, as her natural guardian, had obtained the permission of the Court or that the sale effected by him was one for legal necessity. These two vital points have been concurrently found against the appellant. The only contention which Mr. Sampath, appearing for the appellant, is in a position to urge is as regards the question whether the suit is hit by section 6(e) of the T.P. Act. Counsel says that all that the ex minor was in a position to transfer, was her mere right to sue to set aside the sale and recover possession of the property transferred by her father as her natural guardian. The property itself had been transferred by the father prior to its sale by the ex minor. The minor had, therefore, no property to sell, except a right to set aside the sale. Accordingly, whatever transfer that was effected by the minor in favour of the plaintiff was nothing more than a mere right to sue and such transfer was invalid by reason of section 6(e) of the T.P. Act. Mr. Balakrishnan, appearing for the respondent plaintiff, contends that the ex minor was fully competent to bring a suit to set aside the sale within a period of three years after attaining majority and any person claiming under her is equally competent to institute action for the same purpose. He refers to the provisions of section 8(3) of the Guardianship Act. He contends that a suit to set aside a sale is not for the enforcement of any personal right, but a right in property, and is, therefore, not hit by section 6(e) of the T.P. Act. In any view, counsel says, section 8(3) of the Guardianship Act sepcifically allows such a suit to be brought by a person claiming under a minor and, therefore, such a statutory right specially granted by an enactment dealing with the protection of the minor cannot be defeated by the general provisions of an earlier enactment. The two provisions, counsel says, can be read harmoniously so as to avoid an artificial conflict. What the Guardianship Act intends to protect is the right of a person claiming under a minor to sue for setting aside the sale of property sold otherwise than as permitted by section 8 of the Act. On the other hand, the T.P. Act only prohibits suits in the the nature of champerty and maintenance based on bare or naked right of litigation. The general provision contained in section 6(e) of the T.P. Act does not derogate from the special protection of the minor 's interest and the interest of a person claiming under him, as afforded by the Guardianship Act, which is addressed to a specific problem, In any view, counsel says a sale by the guardian 394 otherwise than as permitted by section 8 is void and is, therefore, incapable of passing a title. For all these reasons, Mr. Balakrishna submits that the suit was competent and was rightly decreed on the facts found and the appeal by the defendant has no merits. As concurrently found by the courts below, the sale effected by the guardian during the minority of his daughter was not in compliance with the provisions of section 18(i) of the Guardianship Act. The property was transferred by him without obtaining the previous permission of the Court and the transfer was not for the benefit of the minor. Such a sale by the minor 's father who is his natural guardian is, unlike in the case of transfer by a de facto guardian (Section 11), not a void sale, but only a voidable sale. Such a sale until set aside is sufficiently effective to pass title, but being a voidable sale, what the buyer has obtained is a defeasible title which is liable to be set aside at the instance of the person entitled to impeach it. Section 8(3) of the Guardianship Act says: "Any disposal of immovable property by a natural guardian, in contravention of sub section (1) or sub section (2), is voidable at the instance of the minor or any person claiming under him." (emphasis supplied) The effect of this sub section is that any disposal of immovable property by a natural guardian otherwise than for the benefit of the minor or without obtaining the previous permission of the Court is voidable. A person entitled to avoid such a sale is either the minor or any person claiming under him. This means that either the minor, or his legal representative in the event of his death, or his successor in interest claiming under him by reason of transfer inter vivos, must bring action within the period prescribed for such a suit, i.e., three years from the date on which the minor died or attained majority, as the case may be. In the present case, the suit was brought, as found by the courts below, within three years after the minor attained majority. Mr. Sampath, however, contends that a person claiming under a minor, referred to in section 8(3), can only be a legal representative of a deceased minor and not a person succeeding to the interests of the minor by reason of transfer inter vivos. He refers to the decisions in Jhaverbhai Hathibhai Patel vs Kabhai Bechar Patel & Ors, ; Mon Mohan Bhattacharjee & Ors. vs Bidhu Bhusan Dutta & Ors., ; Palani Goundan & Anr. vs Vanjiakkal & 395 Anr., ; Premprakash Surajmal vs Maharashtra Revenue Tribunal, Nagpur & Ors., AIR 1969 Bom.361 and Ghanshyam Dass vs Dr. Shiva Shankar Lal & Ors., [1980] All. Law Journal 130 and other cases in which certain High Courts have taken the view that the right of the minor is a personal right and it cannot be transferred otherwise than by inheritence. The "person claiming under him" mentioned under section 8(3) of the Guardianship Act, counsel says, can only be a representative and not a purchaser or transferee inter vivos. He refers to Article 60 of the and submits that the provision refers only to a legal representative and not any other successor. In Jhaverbhai Hathibhai Patel vs Kabhai Bechar Patel & Ors. , , it was held: "what was assigned by the minor to the plaintiff in that suit was not the property in question but his right to sue for it, and if he could establish his allegation, to have the sale avoided, this I think was no more than a right of suit, and if I am correct such a transfer is forbidden by section 6, Cl. (e), T.P. Act. " Similar reasoning was adopted in the other decisions cited by Mr. Sampath on the point. The rationale of these decisions is that the right to impeach a sale effected by the guradian is a personal right vested in the minor and it is not transferable inter vivos. The expression "person claiming under him", according to this line of reasoning, must, therefore, be understood as a legal representative and not an assignee. On the other hand, a Division Bench of the Madras High Court in P. Kamaraju vs C. Gunnayya & Ors., AIR 1924 Madras 322 held that the right of the minor was not a bare right to sue and it was an assignable right. The High Court held: ". .By selling the property to the plaintiff on the footing that the sale by the mother was not binding on him he has chosen to avoid it, and the result of it is that from his point of view he has got a complete title. The title no doubt will only be effective if the Court ultimately finds that the sale by the mother is not binding on him. But contingent on that event he has got a complete title and this title is not a bare right to sue and is, therfore, assignable. . " 396 In Palaniappa Goundan vs Nallappa Goundan & Ors., AIR 1951 Madras 817, Viswanatha Sastri, J. observed: "Where an ex minor transfers property unauthorisedly sold by his guardian during his minority he transfers not a mere right to use but his interest in the property, though a suit may be necessary to avoid the transfer by the guardian & recover possession of the property from his alienee. Conversely, the liability of the transferee from the guardian is not a liability to pay damages for the unauthorised act of the guardian, but is a liability to restore the property to the rightful owner or his transferee". Similar view was expressed in Karnam Nagabhushana Rao vs Karnam Gowramma & Ors., [1968] 2 Andhra Weekly Reporter 57. These decisions on which reliance was placed by the Madras High Court in the impugned judgment are to the effect that the right of the minor is not a bare or naked right to sue but a right in property which is assignable. In Halsbury 's Laws of England, 4th edn. , Vol. 6, paragraphs 86 87 at pages 49 50, this is what is stated "A bare right of litigation, such as a mere right to damages for a wrongful act, is not assignable, on the principle that the law will not recognise any transaction savouring of maintenance or champerty. By way of exception to the rule stated in the previous paragraph there is nothing unlawful in the purchase of property which the purchaser can only enjoy by defeating existing adverse claims, or in the assignment (for example by mortgage) of property, being the fruits of litigation. In every case it is a question whether the purchaser 's real object was to acquire an interest in the property, or merely to acquire a right to bring an action, either alone or jointly with the vendor . ". In the instant case, on the facts found, the transfer of the property made by the guardian was a voidable transaction and it was, therefore, open to the minor to challenge it and seek recovery of possession. Such a right of the minor is a right or interest in property 397 which he himself or "any person claiming under him" may enforce by instituting a suit [Section 8(3) of the Guardianship Act]. "Any person claiming under him" must necessarily include a purchaser. Section 8(3) confers a right of suit in the special circumstances postulated in that provision. The object of the Act being the protection of the minor, the legislature has thought it fit to confer a right of suit in certain circumstances not only on the minor, but also on a person to whom the minor has transferred his rights. The right transferred is an interest in property which is capable of enforcement at the instance of the transferee as it was at the instance of the ex minor prior to the transfer. Such a provision, indeed specially for the protection of the interests of the minor, must be read in harmony and consistently with the general provisions contained in section 6 of the T.P. Act. [See The J.K. Cotton Spinning & Weaving Mills Co. Ltd. vs The State of Uttar Pradesh & Ors., ; , 194 and Ashoka Marketing Ltd. & Anr. vs Punjab National Bank & Ors., [1990] 3 JT SC 417, 439]. The transfer made by the father during his son 's minority was voidable at the instance of his son who was the real owner, and any person purchasing such property from the natural guardian obtained only a defeasible title. The minor retained a right in the property to defeat existing adverse claims, and such right is an assignable right. We are in complete agreement with what has been stated on the point in Palaniappa Goundan vs Nallappa Goundan & Ors., AIR 1951 Madras 817 and in P. Kamaraju vs C. Gunnayya & Ors., AIR 1924 Madras 322. We do not agree with the contrary view expressed on the point in Jhaverbhai Hathibhai Patel vs Kabhai Bechar Patel & Ors., ; Mon Mohan Battacharjee & Ors. vs Bidhu Bhushan Dutta & Ors., and Palani Goundan & Anr. vs Vanjiakkal & Anr., A construction which is unduly restrictive of the statutory provisions intended for the protection of the interest of the minor must be avoided. This is all the more so in view of section 5(b) of the Guardianship Act which says. Save as otherwise expressly provided in this Act (a) . . . . . . . . (b) any other law in force immediately before the com 398 mencement of this Act shall cease to have effect in so far as it is inconsistent with any of the provisions contained in this Act. " For the reasons stated by us, we see no merit in the challenge against the judgment under appeal. The appeal is accordingly dismissed. We do no, however, make any order as to costs. V.P.R. Appeal dismissed.

The appellant purchased the suit property of the minor from a person, to whom the same was sold by the father, the natural guardian, whereas the respondent purchased the suit property from the minor within three years on his attaining majority. The respondent plaintiff instituted a suit against the appellant defendant, to set aside the transfer of property made by the natural guardian and for recovery of possession of property. The suit was decreed and the decree was confirmed by the appellate Court as well as by the High Court. Dismissing the second appeal, the High Court held that the suit instituted bythe respondent as a transferee from the ex minor within three years after the minor attained majority was not hit by section 6(e) of the , against which the present appeal preferred by the appellant defendant. The appellant contended that the suit was hit by section 6(e) of the , as all that the ex minor was in a position to transfer was the mere right to sue to set aside the sale and recover possession of the property transferred by the natural guardian; and 390 that a person claiming under a minor, referred to in section 8(3) of the Hindu Minority and Guardianship Act, 1956 can only be a legal representative of a deceased minor and not a person succeeding to the interest of the minor by reason of transfer inter vivos. The contentions of the respondent were that the ex minor was competent to bring a suit to set aside the sale within a period of three years of his attaining majority and any person claiming under the minor was equally competent to institute action for the same purpose; that the suit to set aside a sale was not for the enforcement of any personal right, but a right in property and the suit was not hit by Section 6(e) of the T.P.Act; and that the provisions contained in Section 6 of the T.P. Act and Section 8 of the Guardianship Act were to be read together. On the question, whether the respondent in his capacity as a transferee from the ex minor was competent to bring a suit to set aside the sale effected by the minor 's guardian, who had sold the property without obtaining the permission of the Court as required under Section 8 of the Hindu Minority and Guardianship Act 1956 and without any legal necessity. Dismissing the appeal of the appellant defendant this Court, HELD: 1. In the instant case, on the facts found, the transfer of the property made by the guardian was a voidable transaction and it was, therefore, open to the minor to challenge it and seek recovery of possession. Such a right of the minor is a right or interest in property which he himself or "any person claiming under him" may enforce by instituting a suit (Section 8(3) of the Guardianship Act). "Any person claiming under him" must necessarily include a purchaser. [396G 397A] 2. Section 8(3) confers a right of suit in the special circumstances postulated therein. The object of the Act being the protection of the minor, the legislature has though it fit to confer a right of suit in certain circumstances not only on the minor, but also on a person to whom the minor has transferred his rights.[397A B] 3. The right transferred is an interest in property which is capable of enforcement at the instance of the transferee as it was at the instance of the ex minor prior to the transfer. Such a provision intended specially for the protection of the interests of the minor, must be read in harmony and consistently with the general provisions con 391 tained in section 6 of the T.P. Act. [397B C]. A construction which is unduly restrictive of the statory provisions intended for the protections of the interests of the minor must be avoided. [397F G] 5. The transfer made by the father during his son 's minority was voidable at the instance of his son who was the real owner, and any person purchasing such property from the natural guardian obtained only a defeasible title. The minor retained a right in the property to defeat existing adverse claims, and such right is an assignable right. [397D E] The J.K.Cotton Spinning & Weaving Mills Co.Ltd. vs The State of Uttar Pradesh & Ors., [1961] 3 S.C.R.185, 194 and Ashoka Marketing Ltd. & Anr. vs Punjab National Bank & Ors., , 439, followed. Palaniappa Goundan vs Nallappa Goundan & Ors., AIR 1951 Madras 817 and P.Kamaraju vs C.Gunnayya & Ors., AIR 1924 Madras 322, approved. Jhaverbhai Hathibhai Patel vs Kabhai Bechar Patel & Ors., AIR 1933 Bom.42; Mon Mohan Battacharjee & Ors. vs Bidhu Bhusan Dutta & Ors., and Palani Goundan & Anr. vs Vanjiakkal & Anr., [1956] I.L.R. Mad.1062, over ruled. Preprakash Surajmal vs Maharashtra Revenue Tribunal. Nagpur &Ors., A.I.R. 1969 Bom.361; and Ghanshyam Dass vs Dr. Shiva Shankar Lal & Ors., [1980] All Law Journal 130, referred to.

ivil Appeal No. 2581 of 1986. Appeal by Certificate from the Judgment and Order dated 15.10.1985 of the Bombay High Court in Appeal No. 547 of 1984. WITH Civil Appeal No. 855 of 1987. 220 From the Judgment and Order dated 8.12.1986 of the Industrial Court, Maharashtra, Bombay in Complaint (ULP) No. 1202 of 1984. Ashok Desai, Attorney General, G.B. Pai, J. Ramamurthy, Jitendra Sharma, B.N. Dutt, H.S. Parihar, Vipin Chandra, R.F. Nariman, P.H. Parekh, N.K. Sahu, Mrs. Urmila Sirur and Raj Birbal for the appearing parties. The Judgment of the Court was delivered by SAWANT, J. These are two appeals involving a common question of law, viz., whether an employer has a right to deduct wages unilaterally and without holding an enquiry for the period the employees go on strike or resort to go slow. In CA No. 2581 of 1986 we are concerned with the case of a strike while in the other appeal, it is a,case of a go slow. By their very nature, the facts in the two appeals differ, though the principles of law involved and many of the au thorities to be considered in both cases may be the same. For the sake of convenience, however, we propose to deal with each case separately to the extent of the distinction. Civil Appeal No. 2581 of 1986 2. The appellant in this case is a nationalised bank, and respondents 1 and 2 are its employees whereas respond ents 3 and 4 are the Unions representing the employees of the Bank. It appears that some demands for wage revision made by the employees of all the banks were pending at the relevant time, and in support of the said demands the All India Bank Employees ' Association had given a call for a countrywide strike. The appellant Bank issued a circular on September 23, 1977 to all its managers and agents to deduct wages of the employees who would participate in the strike for the days they go on strike. Respondents 3 and 4, i.e., the employees ' Unions gave a call for a four hours strike on December 29, 1977. Hence, the Bank on December 27, 1977 issued an Administrative Circular warning the employees that they would be committing a breach of their contract of service if they participated in the strike and that they would not be entitled to draw the salary for the full day if they did so, and consequently, they need not report for work for the rest of the working hours on that day. Notwithstand ing it, the employees went on a four hours strike from the beginning of the working hours on 29th December 1977. There is no dispute that the banking hours for the public covered the said four hours. The employees, however, resumed 221 work on that day after the strike hours, and the Bank did not prevent them from doing so. On January 16, 1978, the Bank issued a Circular directing its managers and agents to deduct the full day 's salary of those of the employees who had participated in the strike. The respondents filed a writ petition in the High Court for quashing the circular. The petition was allowed. The Bank preferred a Letters Patent Appeal in the High Court which also came to be dismissed. Hence, the present appeal. The High Court has taken the view, firstly, that neither regulations nor awards nor settlements empowered the Bank to make the deductions, and secondly, in justice, equity and good conscience the Bank could not by the dictate of the impugned circular attempt to stifle the legitimate weapon given by the law to the workers to ventilate their griev ances by resorting to strike. The High Court further took the view that since strikes and demonstrations were not banned in the country and despite the inconvenience that they may cause, they were recognised as a legitimate form of protest for the workers, the circular acted as a deterrent to the employees from resorting to a legally recognised mode of protest. According to the High Court, the circular even acted as an expedient to stifle the legitimate mode of protest allowed and recognised by law. The deduction of the wages for the day according to the Court amounted to unilat erally changing the service conditions depriving the workers of their fixed monthly wages under the contract of service. The Court also reasoned that under the conditions of serv ice, wages were paid not from day to day or hour to hour but as a fixed sum on a monthly basis. The contract between the Bank and the workers being not a divisible one, in the absence of a specific term in the regulations, awards and settlements, the Bank could not unilaterally reduce the monthly wage and thus give the employees lesser monthly wages than the one contracted. The non observance by the employees of the terms of the contract may give the employer a cause of action and a right to take appropriate remedy for the breach, but the employer was not entitled to deduct any part of the wages either on a pro rata basis or otherwise. The High Court further opined that the Bank was not without a remedy and the employees cannot hold the bank to ransom. The Bank could get the four hours strike declared illegal by recourse to the machinery provided by law or put the erring workers under suspension for minor misconduct under Regula tion 19.7, hold an enquiry and if found guilty, impose punishment of warning, censure, adverse remarks or stoppage of increment for not more than six months as prescribed by Regulation 19.8. The High Court also rejected the contention of the Bank that the Bank was entitled to make 222 deductions under Section 7(2) of the by holding that the provision enabled the employer to deduct wages only if the Bank had power under the contract of employment. The principal question involved in the case, accord ing to us, is, notwithstanding the absence of a term in the contract of employment or of a provision in the service rules or regulations, whether an employer is entitled to deduct wages for the period that the employees refuse to work although the work is offered to them. The deliberate refusal to work may be the result of various actions on their part such as a sit in or stay in strike at the work place or a strike whether legal or illegal, or a go slow tactics. The deliberate refusal to work further may be legal or illegal as when the employees go on a legal or illegal strike. The legality of strike does not always exempt the employees from the deduction of their salaries for the period of strike. It only saves them from a disciplinary action since a legal strike is recognised as a legitimate weapon in the hands of the workers to redress their griev ances. It appears to us that this confusion between the strike as a legitimate weapon in the hands of the workmen and the liability of deduction of wages incurred on account of it, whether the strike is legal or illegal, has been responsible for the approach the High Court has taken in the matter. It is necessary to clear yet another misconception. There is no doubt that whenever a worker indulges in a misconduct such as a deliberate refusal to work, the employ er can take a disciplinary action against him and impose on him the penalty prescribed for it which may include some deduction from his wages. However, when misconduct is not disputed but is, on the other hand, admitted and is resorted to on a mass scale such as when the employees go on strike, legal or illegal, there is no need to hold an inquiry. To insist on an inquiry even in such cases is to pervert the very object of the inquiry. In a mass action such as a strike it is not possible to hold an inquiry against every employee nor is it necessary to do so unless, of course, an employee contends that although he did not want to go on strike and wanted to resume his duty, he was prevented from doing so by the other employees or that the employer did not give him proper assistance to resume his duty though he had asked for it. That was certainly not the situation in the present case in respect of any of the employees and that is not the contention of the employees either. Hence, in cases such as the present one, the only question that has to be considered is whether, when admittedly the employees refuse to work by going on strike, the employer is entitled to deduct wages for the relevant period or not. We 223 thought that the answer to this question was apparent enough and did not require much discussion. However, the question has assumed a different dimension in the present case be cause on the facts, it is contended that although the em ployees went on strike only for four hours and thereafter resumed their duties, the Bank has deducted wages for the whole day. It is contended that in any case this was imper missible and the Bank could at the most deduct only pro rata wages. Normally, this contention on the part of the workers would be valid. But in a case such as the present one, where the employees go on strike during the crucial working hours which generate work for the rest of the day, to accept this argument is in effect to negate the purpose and efficacy of the remedy, and to permit its circumvention effectively. It is true that in the present case when the employees came back to work after their four hours strike, they were not prevented from entering the Bank premises. But admittedly, their attendance after the four hours strike was useless because there was no work to do during the rest of the hours. It is for this reason that the Bank had made it clear, in advance, that if they went on strike for the four hours as threatended, they would not be entitled to the wages for the whole day and hence they need not report for work thereafter. Short of physically preventing the employ ees from resuming the work which it was unnecessary to do, the Bank had done all in its power to warn the employees of the consequences of their action and if the employees, in spite of it, chose to enter the Bank 's premises where they had no work to do, and in fact did not do any, they did so of their own choice and not according to the requirement of the service or at the direction of the Bank. In fact, the direction was to the contrary. Hence, the later resumption of work by the employees was not in fulfilment of the con tract of service or any obligation under it. The Bank was therefore not liable to pay either full day 's salary or even the pro rata salary for the hours of work that the employees remained in the Bank premises without doing any work. It is not a mere presence of the workmen at the place of work but the work that they do according to the terms of the contract which constitutes the fulfilment of the contract of employ ment and for which they are entitled to be paid. It is also necessary to state that though, before the High Court, reliance was placed by the Bank on the provi sions of Section 7(2)(b) read with Section 9 of the for a right to deduct the wages for absence from duty, there is nothing on record to show that the provisions of the said Act have been made applicable to the Bank. However, assuming that Act was applicable to the Bank, we are of the opinion that the relevant discussion of the 224 High Court has missed the contentions urged by the Bank on the basis of the said provisions. What was urged by the Bank was that the said provisions enabled it to deduct wages for absence from duty. Hence, even if the Service rules/regula tions were silent on the point, the Bank could legally deduct the wages under the said provisions. The High Court has reasoned that the power given by the said provisions come into play only when the employer has power to do so, probably meaning thereby, the power under the Service rules/regulations. We are unable to appreciate this reason ing, which to say the least, begs the question. It is, therefore, necessary to point out that if the Act was ap plicable, the Bank would certainly have had the power to deduct the wages under the said provisions in the absence of any service rule regulation to govern the situation. Since the admitted position is that the service rules do not provide for such a situation, the question as stated earlier which requires to be answered in the present case, is whether there exists an implied right in the employer Bank to take action as it has done. There is no dispute that although the service regulations do not provide for a situa tion where employees on a mass scale resort to absence from duty for whole day or a part of the day whether during crucial hours or otherwise, they do provide for treating an absence from duty of an individual employee as a misconduct and for taking appropriate action against him for such absence. Since the High Court has indicated a disciplinary action under the said provision even in the present circum stances, we will also have to deal with that aspect. But before we do so, we may examine the relevant authorities cited at the Bar. 8. In Buckingham and Carnatic Co. Ltd. vs Workers of the Buckingham and Carnatic Co. Ltd., ; the facts were that on 1st November, 1948 the night shift operatives of the carding and spinning department of the appellant Mills stopped work, some at 4 p.m., some at 4.30 p.m. and some at 5 p.m. and the stoppage ended at 8 p.m. in both the departments, and at 10 p.m. the strike ended completely. The apparent cause for the strike was that the management of the Mills had expressed its inability to comply with the request of the workers to declare the forenoon of the 1st November, 1948 as a holiday for solar eclipse. On 3rd November, 1948, the management put up a notice that the stoppage of work on the 1st November amounted to an illegal strike and a break in service within the meaning of the Factories Act and that the management had decided that the workers who had partici pated in the said strike would not be entitled to holidays with pay as provided by the Act. The disputes having thus arisen, 225 the State Government referred the matter to Industrial Tribunal. The Tribunal held that the workers had resorted to an illegal strike and upheld the view of the management that the continuity of service of the workers was broken by the interruption caused by the illegal strike and as a result the ' workers were not entitled to annual holidays with pay under Section 49 B(1) of the Factories Act. The Tribunal, however, held that the total deprivation of leave with pay was a severe punishment and reduced the punishment by 50 per cent and held that the workers would be deprived of only half their holidays with pay. In the appeal before the then Labour Appellate Tribunal, the Tribunal held, among other things, that what happened on the night of the 1st November did not amount to a strike and did not cause any interrup tion in the workers ' service. The Tribunal observed that "It would be absurd to hold that non permitted absence from work even for half an hour or less in the course of a working day would be regarded as interruption of service of a workman for the purpose of the said section (i.e., Section 49 B(1) of the Factories Act). We are inclined to hold that the stoppage of work for the period for about 2 to 4 hours in the circumstances of the ease is not to be regarded as a strike so as to amount to a break in the continuity of service of the workman concerned". In the result, the Tribu nal allowed the Union 's appeal and ordered that holidays at full rates as provided for in Section 49 A of the Factories Act will have to be calculated on the footing that there was no break in the continuity of service. This Court set aside the finding of the Appellate Tribunal by holding that it could not be disputed that there was a cessation of work by a body of persons employed in the Mills and that they were acting in combination and their refusal to go back to work was concerted, and the necessary ingredients of the defini tion of "strike" in Section 2 (q) of the Industrial Disputes Act existed and it was not a ease of an individual worker 's failure to turn up for work. Hence, it was an illegal strike because no notice had been given to the management, the Mills being a public utility industry. In Secretary of State for Employment vs Associated Society of Locomotive Engineers and Firemen and Ors. (No. 2), , Lord Denning MR observed: ". It is equally the case when he is employed as one of many 's to work in an undertaking which needs the service of all. If he, with the others, takes steps wilfully to disrupt the undertaking to produce chaos so that it will not run as it should. then each one who is a party to those steps is guilty 226 of a breach of his contract. It is no answer for any one of them to say 'I am only obeying the rule book ', or 'I am not bound to do more than a 40 hour week '. That would be all very well if done in good faith without any wilful disrup tion of services; but what makes it wrong is the object with which it is done. There are many branches of our law when an act which would otherwise be lawful is rendered unlawful by the motive or object with which it is done. So here it is the wilful disruption which is the breach. It means that the work of each man goes for naught. It is made of no effect. I ask: is a man to be entitled to wages for his work when he, with others, is doing his best to make it useless? Surely not. Wages are to be paid for services rendered, not for producing deliberate chaos. The breach goes to the whole of the consideration, as was put by Lord Campbell CJ in Cuckson vs Stones, [1858] 1 E & E 248 at 255, (1983 60) All ER Rep 390 at 392 and with other cases quoted in Smith 's Leading Cases (13th Edn., Vol. 2, p. 48), the notes to Cutter vs Power, [1795] 6 Term Rep 320, (1775 1802)All ER Rep 159)". In Miles vs Wakefield Metropolitan District Council, [ 1989] I LLJ 335 the facts were that the plaintiff, Miles was the Superintendent Registrar in the Wakefield Metropolitan District Council. His duties included performing marriages. As part of trade union action, he declined to perform mar riages on Saturdays which day was very popular with marrying couples. However, on that day he performed his other duties. The Council, not wanting to terminate his services, imposed a cut in his remuneration. He sued the Council for payment but failed. He appealed to the Court of Appeal and was successful. The appellate court held that he was a statutory official and there was no contractual relation and the only action against him was dismissal. Aggrieved by this appel late decision, the Council went before the House of Lords in appeal. The House of Lords held that the salary payable to the plaintiff was not an honorarium for the mere tenure of office but had the character of remuneration for work done. If an employee refused to perform the full duties which could be required of him under his contract of service, the employer is entitled to refuse to accept any partial per formance. In an action by an employee to recover his pay, it must be proved or admitted that the employee worked or was willing to work in accordance with the contract of employ ment or that such service as was given by the employee, if falling short of. his contractual obligations was accepted by the 227 employer as sufficient performance of the contract. In a contract of employment wages and work go together. The employer pays for the work and the worker works for his wages. If the employer declines to pay, the worker need not work. If the worker declines to work, the employer need not pay In an action by a worker to recover his pay, he must allege and prove that he worked or was willing to work. In the instant case, the plaintiff disentitled himself to salary for Saturday morning because he declined to work on Saturday morning in accordance with his duty. Since the employee had offered only partial performance of his con tract, the employer was entitled, without terminating the contract of employment, to decline partial performance, and in that case the employee would not be entitled to sue for his unwanted service. In this connection, Lord Templeman stated as follows: "The consequences of counsel 's submissions demonstrate that his analysis of a contract of employment is deficient. It cannot be right that an employer should be compelled to pay something for nothing whether he dismisses or retains a worker. In a contract of employment wages and work go together. The employer pays for work and the worker works for his wages. If the employer declines to pay, the worker need not work. If the worker declines to work, the employer need not pay. In an action by a worker to recover his pay he must allege and be ready to prove that he worked or was willing to work . . " It may be mentioned here that on the question whether the employee engaged in some kind of industrial action can claim wages on the basis of quantum meruit, only two of the Law Lords expressed themselves in favour, while the other three did not want to express any definite opinion on the question. Among the decisions of the various High Courts relied upon by the parties in support of the respective cass, we find that except for the decision in V. Ganesan vs The State Bank of India & Ors., given by the learned Single Judge of the Madras High Court and the deci sion of the Division Bench of the same Court in that matter and other matters decided together in State Bank of India, Canara Bank, Central Bank etc. & Ors. vs Ganesan, Jambuna than, Venkataraman, B.V. Kamath, V.K. Krishnamurthy, etc. & Ors., , all other decisions, namely, (i) Sukumar Bandyo 228 padhyyay & Ors. vs State of West Bengal & Ors., [1976] IXLIC 1689; (ii) Algemene Bank Nederland, N.V. vs Central Govern ment Labour Court, Calcutta & Ors., [1978] II LLJ, 117; (iii) V. Ramachandran vs Indian Bank, ; (iv) Dharam Singh Rajput & Ors. vs Bank of India, Bombay & Ors., [1979]12 LIC 1079; (v) R. Rajamanickam, for himself and on behalf of other Award Staff vs Indian Bank, [1981] II LLJ 367; (vi) R.N. Shenoy & Anr. etc. vs Central Bank of India & Ors. , [1984] XVII LIC 1493 and (vii) Prakash Chandra Johari vs Indian Overseas Bank & Anr. [1986] II LI J 496, have variously taken the view that it is not only permissi ble for the employer to deduct wages for the hours or the days for which the employees are absent from duty but in cases such as the present, it is permissible to deduct wages for the whole day even if the absence is for a few hours. It is also held that the contract is not indivisible. Some of the decisions have also held that the deduction of wages can also be made under the provisions of the and similar statutes where they are applicable. It is further held that deduction of wages in such cases is not a penalty but is in enforcement of the contract of employment and hence no disciplinary proceedings need precede it. Even in V. Ganesan vs The State Bank of India & Ors., (supra), it was not disputed on behalf of the employees that the employer, namely, the Bank had no fight to deduct pro rata the salary of the officers for the period of absence from duty. What was contended there was that the Bank was not entitled to deduct the salary for the whole three days on which the employees had staged a demonstration for a duration of 30 minutes during working hours on two days and for an hour, on the third day. The learned Judge held that by permitting the employees to perform their work during the rest of the day and by accepting such performance the bank must be deemed to have acquiesced in the breach of contract by the employees. It is on this fact that the learned Judge held that the right to deduct salary (obviously for the whole day) on the principle of "no work no pay" could be exercised only when there was a term in the contract or when there was a statutory provision to that effect. The Division Bench of the said Court in appeal against the said decision and similar other matters (supra) confirmed the reasoning of the learned Judge and held that in the absence of either a term in the contract of service stipulating that if an employee abstains from doing a particular work on a particu lar day, he would not be entitled to emoluments for the whole day or in the absence of a statutory provision laying down such a rule, it was impermissible for the employer to deduct or withhold the emoluments 229 of the employees even for the hours during which they worked. Having accepted the performance of work from the employees for the rest of the day, the Banks are bound to compensate the employees for the work performed by them. In that very case, the Court also held, on the facts arising from the other matters before it, that the refusal to per form the clearing house work can only be the subject matter of a disciplinary action and it cannot straightaway result in the withholding of the wages for the whole day. Non signing of the attendance register and doing work is also work for which the employees should be compensated by pay ment of remuneration. On the specific question whether the management can take action in situations, where either the contract, Stand ing Order or rules and regulations are silent, both parties relied on further authorities. In Workmen of M/s. Firestone Tyre & Rubber Co. of India (P) Limited vs Firestone Tyre & Rubber Co., ; on which reliance was placed on behalf of the workmen it was held that under the general law of master and servant, an employer may discharge an employee either temporarily or permanently but that cannot be without adequate notice. Mere refusal or inability to give employment to the workmen when he reports for duty, on one or more grounds mentioned in clause (kkk) of Section 2 of the Industrial Disputes Act is not a temporary discharge of the workmen. Such a power, therefore, must be found out from the terms of the contract of service or the Standing Orders governing the establish ment Hence, even for lay off of the workmen there must be a power in the management either in the contract of service or the standing orders governing the establishment. Ordinarily, the workmen, therefore, would be entitled to their full wages when the workmen are laid off without there being any such power. There was no common law right to lay off the workmen, and, therefore, no right to deny the workmen their full wages. In Krishnatosh Das Gupta vs Union of India & Ors., , it was a case of the employees of the National Test House, Calcutta who had staged demonstration after signing the attendance register to register their protest against suspension of some of their colleagues. Though the employees signed the attendance register and attended the office, they did no work on the relevant day. As such, a circular was issued by the Joint Director inform ing the employees that they would be considered as "not on duty". By a subsequent circular the same Joint Director notified to all departments concerned the decision of the Cabinet that there shall not be pay for no work. Relying on the said 230 circular the Management of the National Test House effected on a mass scale pay cut from the pay and allowances of the concerned employees. The circular was challenged by the employees by a writ petition before the High Court. The High Court held that in order to deduct any amount from salary, there must be specific rules relating to the contract of service of the person concerned. On behalf of the employers, reliance was placed on a decision of this Court in Sant Ram Sharma vs State of Rajas than & Anr.; , for the proposition laid down there.that in the absence of any statutory rules or a spe cific provision in the rules, the Government can act by administrative instructions. The Court has held there that though it is true that the Government cannot amend or super sede statutory rules by administrative instructions, if the rules are silent on any particular point, Government can fill up the gaps and supplement the rules and issue instruc tions not inconsistent with the rules already framed. In Roshan Lal Tandon vs Union of India, ; , this Court has stated that although the origin of Government service is contractual in the sense that there is an offer and acceptance in every case, once appointed to his post or office, the Government servant acquires a status, and his rights and obligations are no longer determined by consent of both parties but by statute or statutory rules which may be flamed or altered unilaterally by the Govern ment. In other words, the legal position of the Government servant is more of status than of contract. The hallmark of status is the attachment to legal relationship of rights and duties imposed by the public law and not by mere agreement of the parties. The relationship between the Government and the servant is not like an ordinary contract of service between a master and servant. The legal relationship is something entirely different, something in the nature of status. In V.T. Khanzode & Ors. vs Reserve Bank of India & Anr. , ; , this Court has reiterated that so long as Staff Regulations are not flamed, it is open to issue admin istrative circulars regulating the service conditions in the exercise of power conferred by Section 7(2) of the so long as they do not impinge on any regulations made under Section 58 of the Act. The same view with regard to power to issue administra tive instructions when rules are silent on a subject has been reiterated by the Court in Paluru Ramkrishnaiah & Ors. vs Union of India & 231 Anr. ; , and in Senior Superintendent of Post Office & Ors. vs Izhar Hussain, ; 11. The principles which emerge from the aforesaid authorities may now by stated. Where the contract, Standing Orders or the service rules/regulations are silent on the subject, the management has the power to deduct wages for absence from duty when the absence is a concerted action on the part of the employees and the absence is not disputed. Whether the deduction from wages will be pro rata for the period of absence only or will be for a longer period will depend upon the facts of each case such as whether where was any work to be done in the said period, whether the work was in fact done and whether it was accepted and acquiesced in, etc. It is not enough that the employees attend the place of work. They must put in the work allotted to them. It is for the work and not for their mere attendance that the wages/salaries are paid. For the same reason, if the employ ees put in the allotted work but do not, for some reason may be even as a protest comply with the formali ties such as signing the attendance register, no deduction can be effected from their wages When there is a dispute as to whether the employees attended the place of work or put in the allotted work or not, and if they have not, the reasons therefore etc., the dispute has to be investigated by holding an inquiry into the matter. In such cases, no deduction from the wages can be made without establishing the omission and/or commission on the part of the employees concerned. When the contract, Standing Orders, or the service rules/regulations are silent, but enactment such as the providing for wage cuts for the absence from duty is applicable to the establishment concerned, the wages can be deducted even under the provisions of such enactment. Apart from the aforesaid ratio of the decisions and the provisions of the and similar statutes on the subject, according to us, the relevant provisions of the major legislation governing the industrial disputes, viz., the also lend their support to the view that the wages are payable pro rata for the work done and hence deductible for the work not done. Section 2 (rr) of the said Act defines "wages" to mean "all remuneration . which would, if terms of employ ment, expressed or implied, were fulfilled, be payable to workman in respect of his employment or work done in such employment . " while Section 232 2(q) defines "strike" to mean "cessation of work" or "refus al to continue to work or accept employment by workman". Reading the two definitions together, it is clear that wages are payable only if the contract of employment is fulfilled and not otherwise. Hence, when the workers do not put in the allotted work or refuse to do it, they would not be entitled to the wages proportionately. The decisions including the one impugned in this appeal which have taken the view which is either contrary to or inconsistent with the above conclusions, have done so because they have proceeded on certain wrong presumptions. The first error, as we have pointed out at the outset, is to confuse the question of the legitimacy of the strike as a weapon in the workers ' hands with that of the liability to lose wages for the period of strike. The working class has indisputably earned the right to strike as an industrial action after a long struggle, so much so that the relevant industrial legislation recognises it as their implied right. However, the legislation also circumscribes this right by prescribing conditions under which alone its exercise may become legal. Whereas, therefore, a legal strike may not invite disciplinary proceedings, an illegal strike may do so, it being a misconduct. However, whether the strike is legal or illegal, the workers are liable to lose wages for the period of strike. The liability to lose wages does not either make the strike illegal as a weapon or deprive the workers of it. When workers resort to it, they do so knowing full well its consequences. During the period of strike the contract of employment continues but the workers withhold their labour. Consequently, they cannot expect to be paid. The second fallacy from which the said decisions suffer is to view the contract of employment as an indivisible one in terms of the wageperiod. When it is argued that the wages cannot be deducted pro rata for the hours or for the day or days for which the workers are on strike because the con tract, which in this case is monthly, cannot be subdivided into days and hours, what is forgotten is that, in that case if the contract comes to an end amidst a month by death, resignation or retirement of the employee, he would not be entitled to the proportionate payment for the part of the month he served. This was the iniquitous and harsh conse quence of the rule of indivisibility of contract laid down in an English case, Cutter vs Powell, [1795] 6 TR 320 which was rightly vehemently criticised and later, fortunately not followed. If the employment contract is held indivisible, it will be so for both the parties. We are also unable to see any difficulty, inequity or impracticability in construing the contract as divisible into different 233 periods such as days and hours for proportionate reimburse ment or deduction of wages, which is normally done in prac tice. The third fallacy was to equate disputed individual conduct with admitted mass conduct. A disciplinary proceed ing is neither necessary nor feasible in the latter case. The contract of employment, Standing Orders or the service rules provide for disciplinary proceedings for the lapse on the part of a particular individual or individuals when the misconduct is disputed. As things stand today; they do not provide a remedy for mass misconduct which is admitted or cannot be disputed. Hence, to drive the management to hold disciplinary proceedings even in such cases is neither necessary nor proper. The service conditions are not expect ed to visualise and provide for all situations. Hence, when they are silent on unexpected eventualities, the management should be deemed to have the requisite power to deal with them consistent with law and the other service conditions and to the extent it is reasonably necessary to do so. The pro rata deduction of wages is not an unreasonable exercise of power on such occasions. Whether on such occasions the wages are deductible at all and to what extent will, howev er, depend on the facts of each case. Although the employees may strike only for some hours but there is no work for the rest of the day as in the present case, the employer may be justified in deducting salary for tile whole day. On the other hand, the employees may put in work after the strike hours and the employer may accept it or acquiesce in it. In that case the employer may not be entitled to deduct wages at all or be entitled to deduct them only for the hours of strike. If further statutes such as the or the State enactments like the Shops and Establishments Act apply, the employer may be justified in deducting wages under their provisions. Even if they do not apply, nothing prevents the employer from taking guidance from the legisla tive wisdom contained in it to adopt measures on the lines outlined therein, when the contract of employment is relent on the subject. It is, however, necessary to reiterate that even in cases such as the present one where action is resorted to on a mass scale, some employees may not be a party to the action and may have genuinely desired to discharge their duties but could not do so for failure of the management to give the necessary assistance or protection or on account of other circumstances. The management will not be justified in deducting wages of such employees without holding an in quiry. That, however, was not the grievance of any of the employees in the present case, as pointed out earlier. 234 15. Hence, we are unable to sustain the impugned deci sion which is untenable in law. The decision is accordingly set aside with no order as to costs. Civil Appeal No. 855 of 1987 16. The facts in this case are different from those in the earlier appeal. In this case, the allegation of the employer Company is that the workers had indulged in "go slow" and as a result there was negligible production in the month of July 1984. The workers did not attend to their duty and only loitered in the premises and indulged in go slow tactics only with a view to pressurise the Company to con cede demands. The Company was, therefore, compelled to suspend its operation by giving a notice of lock out. Ac cording to the Company, therefore, since the workers had not worked during all the working hours, they had not earned their wages. Hence, the Company did not pay the workers their wages for the entire month of July 1984. The workers ' Union, therefore, filed a complaint before the Industrial Court under the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971 (MRTU & PULP Act, for short) complaining that the Company had indulged in unfair labour practice mentioned in Item 9 of Schedule 4, from 7th August, 1984 which was the date for payment of salary for the month of July 1984, and under Item 6 of Schedule 2 of the Act with effect from 14th August, 1984 since the Company had declared a lock out from that day. It was also alleged that since no specific date of the com mencement of the alleged lock out had been specified, it was an illegal one. It appears that the Company had declared the lock out by notice dated July 30, 1984 and the lock out was effected from August 14, 1984. Subsequently, there were negotiations between the Union and the Company, and a set tlement was reached on October 15, 1984 as a result of which the lock out was lifted with effect from October 16, 1984. The terms of the settlement were formally reduced to writing on November 30, 1984. In this appeal, we are not concerned with the lock out and the subsequent settlement. The question that falls for consideration before us is whether the Company was justified in denying to the workers the full monthly wages for the month of July 1984. On this question, the Industrial Court accepted the oral testimony of the Company 's witnesses that the workmen had not at all worked for full eight hours on any day in July 1984 and that they were working intermit 235 tently only for some time and sitting idle during the rest of the day. On an average the workers had not worked for more than one hour and 15 to 20 minutes per day, during that month. The Industrial Court did not accept the evidence of the Union 's witness that the witness and the other workmen had worked on all the days during the entire month of July 1984 because he admitted that after the Company told the workers that it could not concede to the demands, the work ers had started staging demonstration. Although the witness denied that from July 3, 1984, the workers started indulging in go slow, he admitted that the Company was displaying notices from time to time with effect from July 4, 1984 alleging that the workers were not giving production and that they were loitering here and there. According to the Industrial Court in the circumstances, it did not see any good reason to disbelieve the Company 's witnesses. The Court further held that normally in view of this evidence on record, it would have held that the pro rata deduction of wages made by the Company for the month of July 1984 would not amount to an act of unfair labour practice falling under Item 9 of Schedule IV of the MRTU and PULP Act. However, in view of the two judgments of the Bombay High Court in T.S. Kelwala & Ors. vs Bank of India & Ors., i.e. the one impugned in the earlier appeal and Apar (Pvt) Limited vs S.R. Samant & Ors., [1980] II LLJ 344, the Court had to hold that the non payment of full wages to the work men for the month of July 1984 was an act of unfair labour practice falling under the said provision of the Act. The Court further held that admittedly the workers were not piece rated and there was no agreement or settlement allow ing the Company to deduct wages on the ground that they were indulging in "go slow" or that they had not given normal production. According to the Court, the remedy of the Compa ny against the workmen may lie elsewhere. Thus, the Court taking sustenance from the Bombay High Court Judgments referred to above held that the deduction of wages during the month of July, 1984 on account of the go slow was not justified, and declared that the Company had committed an unfair labour practice by not paying full monthly wages to the workmen, and directed the Company to pay the said wages for the month of July 1984. It is this order of the Indus trial Court which is challenged directly in this Court by the present appeal. Since one of the two decisions of the Bombay High Court on which the Industrial Court relied was rendered in another context and it has already been discussed in the other appeal, we may refer here only to the other decision, viz., Apar (Pvt) Ltd. vs S.R. Samant & Ors. , (supra) which is pressed in service before us on behalf of the workmen. The facts in that case were that by a settlement dated Au 236 gust 3, 1974 the workmen were allowed increase in the basis wages, dearness allowance, house rent, etc. in addition to the production bonus in terms of a scheme. That settlement was binding on the parties upto the end of April 1977. The matters ran a smooth course till August 1975. However, from September 1975, the Company refused to pay the production bonus and with effect from 15th October, 1975 it refused to pay the wages, dearness allowances etc. as per the settle ment. On August 21, 1975, a notice was put up by the Company starting that because of the attitude of indiscipline on the part of the workers and deliberate go slow tactics resulting in low production, the management was relieved of its com mitments and obligation imposed upon it by the settlement. A notice in terms of Section 9A of the was also put up indicating a certain scale of wages to which only the workers would be entitled. These wages were not more than the wages under the Minimum Wages Act and were even less than what was agreed to in the earli er agreement of January 23, 1971. A complaint was, there fore, filed under the MRTU & PULP Act before the Industrial Court, and the Industrial Court recorded a finding that the figures of production produced by the Company before it related only to few departments. Out of total of 700 employ ees who were working earlier, 116 were retrenched at the relevant time. The Company 's allotment of material, viz., aluminium was also reduced from 7390 metric tones to 2038 and there was no supply of even that allotted quantity. The Court further referred to certain inconsistent statements made by the factory manager and held that the management had failed to discharge the burden of proof of justifying the drastic reduction of the wages and other emoluments. The Court therefore recorded a finding that the Company had engaged in an unfair labour practice. Against the said decision, the Company preferred a writ petition before the High Court. The High Court on these facts held that the wages could be deducted only in terms of a statutory provi sion or of a settlement. A reduction of wages on the allega tion that the workers in general had resorted to go slow was wholly impermissible in law specially when the workmen were not piece rated employees. The High Court referred to the cases where reduction of wages for absence from duty for striking work was held as valid such as Major Kanti Bose & Ors. vs Bank of India & Ors., (supra); V. Ramachandran vs Indian Bank, (supra) and Algemene Bank, Nederland vs Central Government Labour Court, Calcutta, (supra) and held that those cases were distinguishable because they related to absence from duty and not go slow. In M/s. Bharat Sugar Mills Ltd. vs Shri Jai Singh & Ors., [1962] 3 237 SCR 684 the facts were that certain workmen of the appel lant Mills resorted to "go slow". The appellant Mills held a domestic inquiry and as a result thereof decided to dismiss 21 workmen, and apply to the Industrial Tribunal under Section 33 of the for permission to dismiss the workmen. Evidence was laid before the Tribunal to prove the charge against the workmen. The Tribunal held that the domestic enquiry was not proper, that the appellant was guilty of mala fide conduct and victimisation, that except in the case of one workman, the others were guilty of deliberate go slow and accordingly granted permission in respect of the one workman only. It is against the said decision that the appellant Mills had approached this Court. This Court held that the evidence produced before the Tribu nal clearly established that 13 out of the 20 workmen were guilty of deliberate go slow and in that connection observed as follows: "Go slow which a picturesque description of deliberate delaying of production by workmen pretending to be engaged in the factory is one of the most pernicious practices that discontended or disgruntled workmen sometime resort to. It would not be far wrong to call this dishonest. For, while thus delaying production and thereby reducing the output the workmen claim to have remained employed and thus to be entitled to full wages. Apart from this also, "go slow" is likely to be much more harmful than total cessation of work by strike. For, while during a strike much of the machinery can be fully turned off, during the "go slow" the machinery is kept going on a reduced speed which is often extremely damaging to machinery parts. For all these reasons "go slow" has always been considered a serious type of misconduct." This Court, therefore, set aside the order of the Tribunal refusing permission to dismiss 13 of the workmen. There cannot be two opinions that go slow is a serious misconduct being a covert and a more damaging breach of the contract of employment. It is an insidious method of undermining discipline and at the same time a crude device to defy the norms of work. It has been roundly condemned as an industrial action and has not been recognised as a legit imate weapon of the workmen to redress their grievances. In fact the model standing orders as well as the certified standing orders of most of the industrial establishments define it as a misconduct and provide for a disciplinary action for it. Hence, once it is 238 proved, those guilty of it have to face the consequences which may include deduction of wages and even dismissal from service. But by its very nature, the proof of go slow, particu larly when it is disputed, involves investigation into various aspects such as the nature of the process of produc tion, the stages of production and their relative impor tance, the role of the workers engaged at each stage of production, the pre production activities and the facilities for production and the activities of the workmen connected therewith and their effect on production, the factors bear ing on the average production etc. The go slow further may be indulged in by an individual workman or only some workmen either in one section or different sections or in one shift or both shifts affecting the output in varying degrees and to different extent depending upon the nature of product and the productive process. Even where it is admitted, go slow may in some case present difficulties in determining the actual or approximate loss, for it may have repercussions on production after the go slow ceases which may be difficult to estimate. The deduction of wages for go slow may, there fore, present difficulties which may not be easily resolu ble. When, therefore, wages are sought to be deducted for breach of con tract on account of go slow, the quantum of deduction may become a bone of contention in most of the cases inevitably leading to an industrial dispute to be adjudicated by an independent machinery statutory or other wise as the parties may resort to. It is necessary to empha size this because unlike in this case of a strike where a simple measure of a pro rata deduction from wages may pro vide a just and fair remedy, the extent of deduction of wages on account of a go slow action may in some case raise a complex question. The simplistic method of deducting uniform percentage of wages from the wages of all workmen calculated on the basis of the percentage fail in production compared to the normal or average production may not always be equitable. It is, therefore, necessary that in all cases where the factum of go slow and/or the extent of the loss of production on account of it, is disputed, there should be a proper inquiry on charges which furnish particulars of the go slow and the loss of production on that account. The rules of natural justice require it, and whether they have been followed or not will depend on the facts of each case. In the present case, the Industrial Court, as point ed out earlier, has accepted the evidence of the witness of the Company that the workmen had not worked for full eight hours on any day in the month concerned, namely, July 1984, and that they were working intermittently only for sometime and were sitting idle during the rest 239 Of the time. According to him, the workers had worked hardly for an hour and 15 to 20 minutes on an average during the said month. The witness had also produced notices put up by the Company from time to time showing the daily fall in the production and calling upon the workmen to resume normalcy. There is further no dispute that the copies of these notices were sent to the Union of the workmen as well as to the Government Labour Officer. The Industrial Court did not accept the evidence of the workmen that there was no go slow as alleged by the Company. Accordingly, the Industrial Court has recorded a finding that the pro rata deduction of wages made by the Company for the month of July 1984 did not amount to an act of unfair labour practice within the mean ing of the said Act. It does not further appear from the record of the proceedings before the Industrial Court that any attempt was made on behalf of the workmen to challenge the figures of production produced by the Company. These figures show that during the entire month of July 1984, the production varied from 7.06 per cent of 13.9 per cent of the normal production. The Company has deducted wages on the basis of each day 's production. In view of the fact that there is a finding recorded by the Industrial Court that there was a go slow resorted to by the workmen and the production was as alleged by the Company during the said period, which finding is not challenged before us, it is not possible for us to interfere with it in this appeal. As stated above, all that was challenged was the right of the employer to deduct wages even when admittedly there is a go slow which question we have answered in favour of the employer earlier. The question with regard to the quantum of deduction from the wages, therefore, does not arise before us for consideration. It is, however, likely that the work men did not question the figures of production before the Industrial Court because they were armed with the two deci sions of the High Curt (supra) which according to them, had negatived the right of the employer to deduct wages even in such circumstances. While, therefore, allowing the appeal, we direct that the appellant will not deduct more than 5 per cent of the wages of the workmen for the month of July 1984. The appeal is allowed accordingly with no order as to costs. G.N. Appeals allowed.

In the former appeal, the appellant is a nationalised Bank. In 1977, some demands for wage revision made by the employees of all Banks were pending and in support of their demands, a call for a country wide strike was given. The appellant Bank issued a Circular on September 23, 1977 to its managers and agents directing them to deduct wages of the employees for the days they go on strike. The respondent Unions gave a car for a four hour strike on December 29, 1977. Two days before the strike, the appellant Bank issued an Administrative Circular warning the employees that if they participate in the strike, they would be committing a breach of their contract of service and they would not be entitled to salary for the full day and they need not report for work for the rest of the working hours on that day. However, the employees went on strike as scheduled, for four hours which included banking hours of the public, and re sumed duty thereafter. The appellant Bank did not prevent them from doing so. The appellant Bank by its circular di rected the managers and agents to deduct the full day 's salary of those employees who participated in the strike. On a writ petition filed by the respondents, the High Court quashed the said Circular. The Letters Patent Appeal filed by the appellant was dismissed. Hence, the appeal by the Bank. In the latter appeal, the appellant is a company whose workers had indulged in "go slow" in July 1984, thereby bringing down production. The workers did not attend to their work and were loitering in the premises and were indulging in go slow tactics to pressurise the 215 company to concede their demands. The company suspended its operation by giving a notice of lock out. It did not pay wages to the workers for July , 1984 on the ground that they did not work during all the working hours and had not their wags. The workers ' union filed a complaint before the Indus trial Court complaining that the appellant company had indulged in unfair labour practice and that the lock out declared was illegal The Industrial Court held that the deduction of wages for July, 1984 on account of the go slow was not justified It also declared that the company had committed an unfair labour practice by not paying full monthly wages to the workers and directed the company to pay the said wages for the month of July, 1984. Aggrieved, the appellant company has preferred the appeal. Allowing the appeals, this Court, HELD: 1.1 There is no doubt that whenever a worker indulges in a misconduct such as a deliberate refusal to work, the employer can take disciplinary action against him and impose on him the penalty prescribed for it which may include some deduction from his wages. However, when miscon duct is not disputed but is, on the other band, ' admitted and is resorted to on a mass scale such as when the employ ees go on strike, legal or illegal, there is no need to hold an inquiry. To insist on an inquiry even in such cases is to pervert the very object of the inquiry. In a mass action such as strike it is not possible to hold an inquiry against every employee nor is it necessary to do so unless, of course, an employee contends that although he did not want to go on strike and wanted to resume his duty, he was pre vented from doing so by the other employees or that the employer did not give him proper assistance to resume his duty though he had asked for it. That was certainly not the situation in the present case in respect of any of the employees and that is not the contention of the employees either. It is true that in the present case when the employ ees came back to work after their four hours strike, they were not prevented from entering the Bank premises. But admittedly, their attendance after the four hours strike was useless because there was no work to do during the rest of the hours. It is for this reason that the Bank had made it clear, in advance, that if they went on strike for the four hours as threatened, they would not be entitled to the wages for the whole day and hence they need not report for work thereafter Short of physically preventing the employ ees from resuming the work which it was unnecessary to do, the Bank had done all hi its power to warn the employees of the consequences of their action and if the employees, in spite of it, chose to enter the Bank 's premises where they had no work to do, and in fact did not 216 do any, they did so of their own choice and not according to the requirement of the service or at the direction of the Bank. In fact, the direction was to the contrary. Hence, the later resumption of work by the employees was not in fulfil ment of the contract of service or any obligation under it. The Bank was therefore not liable to pay either full day 's salary or even the pro rata salary for the hours or work that the employees remained in the Bank premises without doing any work. It is not a mere presence of the workmen at the place of work but the work that they do according to the terms of the contract which constitutes the fulfilment of the contract of employment and for which they were entitled to be paid. [222E H; 223A F] 1.2 Although the service regulations do not provide for a situation where employees on a mass scale resort to ab sence from duty for whole day or a part of the day whether during crucial hours or otherwise they do provide for treat ing an absence from duty of an individual employee as a misconduct and for taking appropriate action against him for such absence. [224D E] 2.1. When the contract, Standing Orders, or the service rules/ regulations are silent, but enactment such as the payment of Wages Act providing for wage cuts for the absence from duty is applicable to the establishment concerned, the wages can be deducted even under the provisions of such enactment. [231F] 2.2. The working class has indisputably earned the right to strike as an industrial action after a long struggle, so much so that the relevant industrial legislation recognises it as their implied right. However, the legislation also circumscribes this right by prescribing conditions under which alone its exercise may become legal. Whereas, there fore, a legal strike may not invite disciplinary proceed ings, an illegal strike may do so, it being a misconduct. However, whether the strike is legal or illegal, the workers are liable to lose wages for the period of strike. The liability to lose wages does not either make the strike illegal as a weapon or deprive the workers of it. When workers resort to it, they do so knowing full well its consequences. During the period of strike the contract of employment continues but the workers withhold their labour. Consequently, they cannot expect to be paid. [232C E] 2.3. The contract, which is this case is monthly, cannot be subdivided into days and hours. If the contract comes to an end amidst a month by death, resignation or retirement of the employee, he would not be entitled to the proportionate payment for the part of the month 217 he served. If the employment contract is held indivisible, it will be so for both the parties. There is no difficulty, inequity or impracticability in construing the contract as divisible into different periods such as days and hours for proportionate reimbursement or deduction of wages, which is normally done in practice. [232G H; 233A] 2.4. The contract of employment, Standing Orders or the service rules provide for disciplinary proceedings for the lapse on the part of a particular individual or individuals when the misconduct is disputed. As things stand today, they do not provide a remedy for mass misconduct which is admit ted or cannot be disputed. Hence, to drive the management to hold disciplinary proceedings even in such cases is neither necessary nor proper. The service conditions are not expect ed to visualise and provide for all situations. When they are silent on unexpected eventualities, the management should be deemed to have the requisite power to deal with them consistent with law and the other service conditions and to the extent it is reasonably necessary to do so. The pro rata deduction of wages is not an unreasonable exercise of power on such occasions. Whether on such occasions, the wages are deductable at all and to what extent will, howev er, depend on the facts of each case. Although the employees may strike only for some hours but there is no work for the rest of the day as in the present case, the employer may be justified in deducting salary for the whole day. On the other hand, the employees may put in work after the strike hours and the employer may accept it or acquiense in it. In that case the employer may not be entitled to deduct wages at all or be entitled to deduct only for the hours of strike. If statutes such as the or the State enactments like the Shops and Establishments Act apply, the employer ,may be justified in deducting wages under their provisions. Even if they do not apply, nothing prevents the employer from taking guidance from the legisla tive wisdom contained in it to adopt measures on the lines outlined therein, when the contract of employment is silent on the subject. [233B F] V.T. Khanzode & Ors. vs Reserve Bank of India & Anr., ; ; Paluru Ramkrishnaiah & Ors. etc. vs Union of India & Anr. ; , and Senior Superin tendent of Post Office & Ors. vs lzhar Hussain; , , relied on. Buckingham and Carnatic Co. Ltd. vs Workers of the Buckingham and Carnatic Co. Ltd., ; ; V. Ganesan vs The State Bank of India & Ors., ; State Bank of India, Canara Bank, Central Bank etc. & Ors. vs Ganesan, Jambunathan, Venkatara 218 man, B.V. Kamath, V.K. Krishnamurthy, etc. & Ors. , ; Sukumar Bandyopadhyyay & Ors. vs State of West Bengal & Ors., [1976] IX LIC 1689; Algemene Bank Nederland, N.V. vs Central Government Labour Court, Calcutta & Ors., [1978] II LLJ, 117; V. Ramachandran vs Indian Bank, [1979] I LLJ 122; Dharam Singh Rajput & Ors. vs Bank of India, Bombay & Ors. , ; R. Rajamanickam, for himself and on behalf of other Award Staff vs Indian Bank, [1981] II LLJ 367; R.N. Shenoy & Anr. etc. vs Central Bank of India & Ors. , [1984] XVII LIC 1493; Prakash Chandra Johari vs Indian Overseas Bank & Anr., [1986] II LLJ 496; Workmen of M/s. Firestone Tyre & Rubber Co. of India (P) Ltd. vs Firestone Tyre & Rubber Co., ; ; Krishnatosh Das Gupta vs Union of India & Ors., ; Sant Ram Sharma vs State of Rajasthan & Anr., ; ; Roshan Lal Tandon vs Union of India, ; ; Secretary of State for Employment vs Associated Society of Locomotive Engineers and Firemen and Ors. (No. 2), ; Miles vs Wakefield Metropolitan District Council, [1989] I LLJ 335 and Cutter vs Pwell, [1795] 6 TR 320, referred to. There cannot be two opinions that go slow is a serious misconduct being a covert and a more damaging breach of the contract of employment. It is an insidious method of undermining discipline and at the same time a crude device to defy the norms of work. It has been roundly condemned as an industrial action and has not been recognised as a legit imate weapon of the workmen to redress their grievances. In fact the model standing orders as well as the certified standing orders of most of the industrial establishments define it as a misconduct and provide for disciplinary action for it. Hence, once it is proved. those guilty of it have to face the consequences which may include deduction of wages and even dismissal from service. [237G H; 238A] 3.2. The proof of go slow, particularly when it is disputed, involves investigation into various aspects such as the nature of the process of production, the stages of production and their relative importance, the role of the workers engaged at each stage of production, the pre produc tion activities and the facilities for production and the activities of the workmen connected therewith and their effect on production, the factors hearing on the average production etc. The go slow further may be indulged in by an individual workman or only some workmen either in one sec tion or different sections or in one shift or both shifts affecting the output in varying degrees and to different extent depending upon the nature of product and the produc tive process. Even where it is admitted, go slow may in some case present 219 difficulties in determining the actual or approximate loss, for it may have repercussions on production after the go slow ceases which may be difficult to estimate. The deduc tion of wages for go slow may, therefore, present difficul ties which may not be easily resoluble. When, therefore, wages are sought to be deducted for breach of contract on account of go slow, the quantum of deduction may become a bone of contention in most of the cases inevitably leading to an industrial dispute to he adjudicated by an independent machinery statutory or otherwise as the parties may resort to. The simplistic method of deducting uniform percentage of wages from the wages of all workmen calculated on the basis of the percentage fail in production compared to the normal or average production may not always be equitable. It is, therefore, necessary that in all cases where the factum of go slow and/or the extent of the loss of production on account of it, is disputed, there should he a proper inquiry on charges which furnish particulars of the go slow and the loss of production on that account. The rules of natural justice require it, and whether they have been followed or not will depend on the facts of each case. [238B G] 3.3. In the instant case, there is a finding recorded by the Industrial Court that there was a go slow resorted to by the workmen resulting in loss of production during the said period. Since the said finding is not challenged, it is not possible to interfere with it in this appeal. Though the appellant is justified in deducting wages for the said period, in the facts and circumstances of the case it is directed that it will not deduct more than 5 per cent of the wages of the workmen for the month of July, 1984 when they indulged in go slow tactics. [239D F] M/s. Bharat Sugar Mills Ltd. vs Shri Jai Singh & Ors., ; T.S. Kelwala & Ors. vs Bank of India & Ors., and Apar (Pvt) Ltd. vs S.R. Samant & Ors., [1980] II LLJ 344, referred to.

Appeal No. 146 of 1955. Appeal from the judgment and decree dated February 10, 1953, of the Bombay High Court in Appeal No. 953 of 1951, arising out of the judgment and decree dated November 36,1951, of the Court of 73 Joint Civil Judge, Senior Division, Poona, in Special Suit No. 76 of 1950. H. D. Banaji, R. A. Gagrat and G. Gopalakrishnan, for the appellant. M. C. Setalvad, Attorney General for India, section N. Andley and J. B. Dadachanji, for the respondent. January 16. The Judgment of the Court was delivered by DAS, C. J. The appellant is a public limited company registered under the Indian Companies Act, 1913. It is a lessee of four cinema houses situate within the municipal limits of Poona City known respectively as " Minerva ", " The Globe ", " Sri Krishna " and " The Nishat ". It exhibits cinematograph films, both foreign and Indian, in the said four houses. The respondent, a body corporate, was governed by the Bombay District Municipal Act, 1901 (Bom. III of 1901) up to June 8, 1926, and from then by the Bombay Municipal Boroughs Act, 1925 (Bom. XVIII of 1925) up to December 29, 1949, and, thereafter, by the Bombay Provincial Municipal Corporation Act, 1949 (Bom. LIX of 1949). With effect from October 1, 1920, the respondent, with the sanction of the Government of Bombay levied on the owners and lessees of cinema houses within the limits of the erstwhile province of Bombay a tax of Rs. 2 per day as license fee. Rules for the levy and collection of the said tax were framed by the respondent. Those rules were amended on or about June 3, 1941, enhancing the tax from Rs. 2 per day to Re. I per show. The rules were again revised on or about June 9,1948, under which the tax was enhanced from Re. I per show to Rs. 5 per show. At all material times the tax was being collected at the last mentioned rate. Section 59 of the Bombay District Municipal Act 1901 provided that subject to any general or special orders which the State Government might make in that behalf any municipality (a) after observing the preliminary procedure required by section 60, and (b) with the sanction of the authority therein mentioned, might 10 74 impose for the purposes of that Act any of the taxes mentioned in that section. After enumerating ten specific heads of taxes, which a municipality could levy a residuary category was set forth in cl. (xi) in the words following: "Any other tax to the nature and object of which he approval of the Governor in, Council shall have been obtained prior to the selection contemplated in sub clause (1) of clause (a) of section 60 ". Ever since the appellant became a lessee of the said cinema houses, the appellant has been making payments of the said tax under protest. After giving the necessary statutory notice to the respondent, the appellant, on or about March 31,1950, filed a suit in the Court of the Civil Judge, Senior Division, Poona, being Suit No. 76 of 1950, against the respondent for a declaration that the levy and imposition of the said tax with effect from October 1, 1920, were invalid and illegal; that the enhancement in the rates of the tax with effect first from June 3, 1941, and then June 9, 1948, was invalid and illegal and that the resolutions passed and rules framed in connection with the levy, imposition, enhancement and collection of the said impugned tax were invalid, illegal and ultra vires, for a permanent injunction restraining the defendants from levying or recovering and or increasing and enhancing the said tax and for refund to the appellant of the amounts of the tax collected from it and for costs of the suit and interest. By its judgment dated November 30, 1951, the trial court held that the said tax was validly levied and imposed, but that the increase and enhancement thereof in 1941 and 1948 were illegal and ultra vires. and that the suit was not barred under the Acts governing the respondent. The trial court decreed the suit in part by issuing an injunction restraining the respondent from levying, recovering or collecting the tax at the enhanced rate and passing a decree against the respondent for refund of a sum of Rs. 27,072 with interest and costs. The respondent preferred an appeal and the appellant filed cross objections. But the High Court by its judgment and decree dated February 10, 1953, 75 reversed the judgment of the trial court and dismissed the suit of the appellant with costs throughout. The appellant 's cross objections were also dismissed. On December 10, 1953, the High Court granted leave to the appellant to appeal to this Court from the said judgment. Hence this final appeal questioning the validity of the impugned tax. The first point urged in this appeal is that the law imposing this tax is not covered by entry 50 in List II of the Seventh Schedule to the Government of India Act, 1935, but is really a tax on the appellant 's trade or calling referred to in entry 46 and that, therefore, the amount of tax cannot under section 142 A of the Government of India Act, 1935 exceed Rs. 100 per annum. This point need not detain us long, for it is covered by us in the appellant 's other appeal No. 145 of 1955. The second point urged before us in support of this appeal is that section 59(1) (xi) is unconstitutional in that the legislature had completely abdicated its functions and had delegated essential legislative power to the Municipality to determine the nature of the tax to be imposed on the rate payers. Learned counsel for the appellant urges that the power thus delegated to the municipality is unguided, uncanalised and vagrant, for there is nothing in the Act to prevent the municipality from imposing any tax it likes, even, say, income tax. Such omnibus delegation, he contends, cannot on the authorities be supported as constitutional. We find ourselves in agreement with the High Court in rejecting this contention. In the first place, the power of the municipality cannot exceed the power of the provincial legislature itself and the municipality cannot impose any tax, e.g., income tax which the provincial legislature could not itself impose. In the next place, section 59 authorises the municipality to impose the taxes therein mentioned " for the purposes of this Act ". The obligations and functions cast upon the municipalities are set forth in ch. VII of the Act. Taxes, therefore, can be levied by the municipality only for implementing those purposes and for no other purpose. In other words it will be open to the municipality to levy a tax for giving any of the amenities therein mentioned. 76 The matter may be illustrated by reference to section 54 which enumerates the duties of municipalities. The first duty mentioned in that section is that the Municipality should make provision for lighting public streets and nobody can object if it imposes alighting tax, which, indeed, is item (ix) in section 59(1). Take another example: It is the duty of the Municipality to arrange for supply of drinking water and it may legitimately charge a water rate which, again, is item (viii) in section 59(1). We do not for a moment suggest that the municipalities may only impose a tax directly in connection with the heads of duties cast upon it. What we say is that the tax to be imposed must have some reasonable relation to the duties cast on it by the Act. In the third place, although the rule of construction based on the principle of ejusdem generis cannot be invoked in this case, for items (i) to (x) do not, strictly speaking, belong to the same genus, but they do indicate, to our mind the kind and nature of tax which the municipalities are authorised to impose. Finally, the provincial legislature had certainly not abdicated in favour of the municipality, for the taxing power of the municipality was quite definitely made subject to the approval of the Governor in Council. Under the Indian Council Act, 1861 (24 & 25 Vic. c. 67) the Governor in Council might mean the Governor in Executive Council or the Governor in Legislative Council. If the reference in section 59(1)(xi) is to the Governor 's Legislative Council, then there was no improper delegation at all, for it was subject to the legislative control of the Governor in Legislative Council. The Governor 's Legislative Council was composed of all the members of the Governor 's Executive Council besides a few other persons. Therefore if the reference was to the Governor in his Executive Council even then, from a practical point of view, the ultimate control was left with the Governor 's Legislative Council. We need not labour this point any further, for on the first three grounds the delegation of legislative authority, if any, is not excessive so as to make the exercise of it unconstitutional. In our opinion the impugned section did lay down a principle and fix a standard 77 which the municipalities had to follow in imposing a tax and the legislature cannot, in the circumstances, be said to have had abdicated itself and, therefore, the delegation of power to impose any other tax cannot be struck down as being in excess of the permissible limits of delegation of legislative functions. The last point urged by learned counsel for the appellant is that, under el. (xi) of section 59(1), the enhancements of the rates of the tax in 1941 and again in 1948 were illegal in that the municipality had no power to do so under the Bombay Municipal Boroughs Act, 1925. According to learned counsel for the appellant the judgment under appeal upholding the validity of such enhancements cannot be supported under s.60 of that Act. That section runs as follows: " Power to suspend 60(1)Subject to the requirements of cl reduce or abolish ause (a)of the proviso to section any existing tax 58 municipality may except as otherwise provide in clause provided in clause (b) of the proviso to section 103 at any time for any sufficient reason, suspend, modify or abolish any existing tax by suspending, altering or rescinding any rule prescribing such tax. " (2) The provisions of Chapter VII relating to, the imposition of taxes shall apply so far as may be to the suspension, modification or abolition of any tax and to the suspension, alteration or rescission of any rule prescribing a tax. " Reference is made to the marginal note where the words used are " power to suspend, reduce or abolish any existing tax ". It is suggested that the word it modify " in the body of the section in between the words " suspend " and " abolish " should be construed in the sense of reduction. The marginal note, according to him, shows that the several words were used in the section to indicate a progressive diminution in the quantum of tax until it was completely gone. Reference is made to the root meaning of the word " modify " which is to reduce or make less but does not cover the idea of enhancement. In the first place, the marginal note cannot affect the construction of the language used in the body of the section if it is otherwise clear and unambiguous (see Commissioner of 78 Income Tax, Bombay vs Ahmedbhai Umarbhai & Co., Bombay) (1). In the next place, it should be borne in mind that section 67 of the Bombay District Municipal Act (Bom. III of 1901) which was formerly applicable to municipalities used the word " reduce " in between the words " suspend " and " abolish " and that that section had been reproduced is section 60 of the Bombay Municipal Boroughs Act, 1925, but that in the process of such reproduction the word "reduce" was dropped ,and the word "modify" was introduced. In the marginal note, however, the word " reduce " was not substituted by the word " modify ", apparently through inadvertence. If the word " modify " is to be read as "reduce", then there could be no point in the provincial legislature substituting the word " reduce " by the word "modify". This change must have been made with some purpose and the purpose could only have been to use an expression of wider connotation so as to include not only reduction but also other kinds of alteration. Section 76 of this very Act also refers to " modification not involving an increase in, the amount to be imposed which makes the sense in which the word " modify has been used in this Act perfectly clear, namely, that there may be a modification involving an increase. Reference may also be made to the decision of the Court of Appeal in England in the case of Stevens vs The General Steam Navigation Company, Ltd. (2). " Modification ", according to Collins M. R. in his judgment at p. 893, implied an alteration and the word was equally applicable whether the effect of the alteration was to narrow or to enlarge the provisions. In our opinion the dropping of the word " reduce " and the introduction of the word 'modify" in the body of section 60, of the Act under consideration clearly indicate an intention on the part of legislature to widen the scope of this section and the High Court was right in so construing the same. No other point was urged in this appeal and for reasons stated above this appeal must be dismissed with costs. Appeal dismissed. (1) ; at P. 353. (2) L.R. (1903) 1 K.B. 890.

The appellant, a public limited company, was a lessee of four cinema houses situated within the municipal limits of Poona City where it used to exhibit cinematograph films. The respondent, the Municipal Corporation of Poona, in exercise of its power under section 59(1) (XI) of the Bombay District Municipal Act, 1901, levied with effect from October 1, 1920 a tax of Rs. 2 per day as license fee on the owners and lessees of cinema houses. That Act governed the Municipality till 1926 and thereafter it was governed by the Bombay Municipal Boroughs Act, 1925. The tax was enhanced to Re. 1 per show on June 3, 1941, and to Rs. 5 per show on June 9, 1948. By the suit, out of which the present appeal arose, the appellant sought for a declaration that the levy of the said tax, the rules framed in connection therewith and the enhancement of the tax as aforesaid were illegal and ultra vires. The trial court decreed the suit in part but the High Court in appeal reversed the decision of the trial court 72 and dismissed the suit. It was contended on behalf of the appellant that (1) the tax was not one covered by Entry 50 in List 11 of Seventh Schedule to the Government of India Act, 1935, but was one on trade or calling covered by Entry 46 thereof, and, was as such governed by section 142A of the said Act and that (2) section 59(1)(XI) Of the Bombay District Municipal Act, 1901, was unconstitutional in that the legislature had thereby delegated essential legislative power to the Municipality to determine the nature of the tax to be imposed on the rate payers and completely abdicated its function, leaving such power wholly unguided. Held, that both the contentions must fail. The first point was covered by the decision given in the appellant 's other appeal, Civil Appeal No. 145 Of 1955 which must also govern this case. It was not correct to contend that the power delegated to the Municipality under section 59(1)(XI) Of the Bombay District Municipal Act, 1901, was unguided. That section authorised the imposition of such taxes alone as were necessary for the purposes of the Act. The obligations and functions cast upon the Municipalities by ch. VII of the Act showed that taxes could be levied only for implementing those purposes and none others. Nor could it be said that the Provincial Legislature had abdicated its function in favour of the Municipality. The taxing power of the Municipality was made subject to the approval of the Governor in Council by the section itself. The marginal note to a section could not affect the construction of the section if its language was otherwise clear and unambiguous and the word 'modify ' connoted not merely reduction but also other kinds of alteration including enlargement. The substitution of the word I reduce ' by the word I modify ' in the body of section 6o of the Bombay Municipal Boroughs Act, 1925, notwithstanding the omission to do so in the marginal note, therefore, clearly indicated the intention of the Legislature to widen the scope of that section and, consequently, it could not be said that the enhancement of the tax was not sustainable thereunder. Commissioner of Income Tax, Bombay vs Ahmedbhai Umarbhai & Co., Bombay, ; and Stevens vs The General Steam Navigation Company, Ltd., , referred to.

ition (Criminal) No.1451 of 1985 Under Article 32 of the Constitution of India. Petitioner in person. Harbans Lal. Tapas Ray, D.K. Sinha, J.R. Das, Girish Chander, Ms. Subhashini, Pramod Swarup, D. Bhandari, C.V.S. Rao, B.D. Sharma, D.N. Mukherjee, R. Mukherjee, A.V. Rangam. T.V. Ratnam, S.B. Bhasme, A.S. Bhasme and A.M. Khanwilkar for the Respondents. The order of the Court was delivered by MISRA J. We made an Order on 12th July, 1986 issuing various directions in regard to physically and mentally retarded children as also abandoned or destitute children who are lodged in various jails in the country for 'safe custody '. We also directed the Director General of Doordarshan as also the Director General of All India Radio to give publicity seeking cooperation of non governmental social service organisations in the task of rehabilitation of these children. We were extremely pained and anguished that these children should be kept in jail instead of being properly looked after, given adequate medical treatment and imparted training in various skills which would make them independent and self reliant. Some years ago we came out with a National Policy for the Welfare of Children which contained the following preambulatory declaration: "The nation 's children are a supremely important asset. Their nurture and solicitude are our responsibility. Children 's programme should find a prominent part in our national plans for the development of human resources, so that our children grow up to become robust citizens, physi cally fit, mentally alert and morally healthy, endowed with the skill and motivations needed by society. Equal opportunities for development to all children during the period of growth should be our aim, for this would serve our large purpose of reducing inequality and ensuring social justice. " If a child is a national asset, it is the duty of the State to look after the child with a view to ensuring full development of its personality. That 565 is why all the statutes dealing with children provide that child shall not be kept in jail. Even apart from this statutory prescription, it is elementary that a jail is hardly a place where a child should be kept. There can be no doubt that incarceration in jail would have the effect of dwarfing the development of the child, exposing him to baneful influences, coarsening his conscience and alienating him from the society. It is a matter of regret that despite statutory provisions and frequent exhortations by social scientists, there are still a large number of children in different jails in the country as is now evident from the reports of the survey made by the District Judges pursuant to our order dated 15th April, 1986. Even where children are accused of offences, they must not be kept in jails. It is no answer on the part of the State to say that it has not got enough number of remand homes or observation homes or other places where children can be kept and that is why they are lodged in jails. It is also no answer on the part of the State to urge that the ward in the jail where the children are kept in separate from the ward in which the other prisoners are detained. It is the atmosphere of the jail which has a highly injurious effect on the mind of the child, estranging him from the society and breeding in him aversion bordering on hatred against a system which keeps him in jail. We would therefore like once again to impress upon the State Governments that they must set up necessary remand homes and observation homes where children accused of an offence can be lodged pending investigation and trial. On no account should the children be kept in jail and if a State Government has not got sufficient accommodation in the remand homes or observation homes, the children should be released on bail instead of being subjected to incarceration in jail. The problem of detention of children accused of an offence would become much more easy of solution if the investigation in the police and the trial by the Magistrate could be expedited. The reports of survey made by District Judges show that in some places children have been in jail for quite long periods. We fail to see why investigation into offences alleged to have been committed by children cannot be completed quickly and equally why can the trial not take place within a reasonable time after the filing of the charge sheet. Really speaking, the trial of children must take place in the Juvenile Courts and not in the regular criminal courts. There are special provisions enacted in various statutes relating to children providing for trial by Juvenile Courts in accordance with a special procedure intended to safeguard the interest and welfare of children, but, we find that in many of the States there are no Juvenile Courts functioning at all and 566 even where there are Juvenile Courts, they are nothing but a replica of the ordinary criminal courts, only the label being changed. The same Magistrate who sits in the ordinary criminal court goes and sits in the Juvenile Court and mechanically tries cases against children. It is absolutely essential, and this is something which we wish to impress upon the State Governments with all the earnestness at our command, that they must set up Juvenile Courts, one in each district, and there must be special cadre of Magistrates who must be suitably trained for dealing with cases against children. They may also do other criminal work, if the work of the Juvenile Court is not sufficient to engage then fully, but they must have proper and adequate training for dealing with cases against Juveniles, because these cases require a different type of procedure and qualitatively a different kind of approach. We would also direct that where a complaint is filed or first information report is lodged against a child below the age of 16 years for an offence punishable with imprisonment of not more than 7 years, the investigation shall be completed within a period of three months from the date of filing of the complaint or lodging of the First Information Report and if the investigation is not completed within this time, the case against the child must be treated as closed. If within three months, the chargesheet is filed against the child in case of an offence punishable with imprisonment of not more than 7 years, the case must be tried and disposed of within a further period of 6 months at the outside and this period should be inclusive of the time taken up in committal proceedings, if any. We have already held in Hussainara Khatoon & Ors. vs Home Secretary, State of Bihar, [1979] 3 SCR 169 that the right to speedy trial is a fundamental right implicit in article 21 of the Constitution. If an accused is not tried speedily and his case remains pending before the Magistrate or the Sessions Court for an unreasonable length of time, it is clear that his fundamental right to speedy trial would be violated unless, of course, the trial is held up on account of some interim order passed by a superior court or the accused is responsible for the delay in the trial of the case. The consequence of violation of the fundamental right to speedy trial would be that the prosecution itself would be liable to be quashed on the ground that it is in breach of the fundamental right. One of the primary reasons why trial of criminal cases is delayed in the courts of Magistrates and Additional Sessions Judges is the total inadequacy of judge strength and lack of satisfactory working conditions for Magistrates and Additional Sessions Judges. There are courts of Magistrates and Additional Sessions Judges where the workload is so heavy that it is just not 567 possible to cope with the workload, unless there is increase in the strength of Magistrates and Additional Sessions Judges. There are instances where appointments of Magistrates and Additional Sessions Judges are held up for years and the courts have to work with depleted strength and this affects speedy trial of criminal cases. The Magistrates and Additional Sessions Judges are often not provided adequate staff and other facilities which would help improve their disposal of cases. We are, therefore, firmly of the view that every State Government must take necessary measures for the purpose of setting up adequate number of courts, appointing requisite number of Judges and providing them the necessary facilities. It is also necessary to set up an Institute or Academy for training of Judicial officers so that their efficiency may be improved and they may be able to regulate and control the flow of cases in their respective courts. The problem of arrears of criminal cases in the courts of Magistrates and Additional Sessions Judges has assumed rather disturbing proportions and it is a matter of grave urgency to which no State Government can afford to be oblivious. But, here, we are not concerned with the question of speedy trial for an accused who is not a child below the age of 16 years. That is a question which may have to be considered in some other case where this Court may be called upon to examine as to what is reasonable length of time for trial beyond which the court would regard the right to speedy trial as violated. So far as a child accused of an offence punishable with imprisonment of not more than 7 years is concerned, we would regard a period of 3 months from the date of filing of the complaint or lodging of the First Information Report as the maximum time permissible for investigation and a period of 6 months from the filing of the charge sheet as a reasonable period within which the trial of the child must be completed. If that is not done, the prosecution against the child would be liable to be quashed. We would direct every State Government to give effect to this principle or norm laid down by us in so far as any future cases are concerned, but so far as concerns pending cases relating to offences punishable with imprisonment of not more than 7 years, we would direct every State Government to complete the investigation within a period of 3 months from today if the investigation has not already resulted in filing of chargesheet and if a chargesheet has been filed, the trial shall be completed within a period of 6 months from today and if it is not, the prosecution shall be quashed. We have by our order dated 5th August 1986 called upon the State Government to bring into force and to implement vigorously the 568 provisions of the Children 's Acts enacted in the various States. But we would suggest that instead of each State having its own Children 's Act in other States. it would be desirable if the Central Government initiates Parliamentary Legislation on the subject, so that there is complete uniformity in regard to the various provisions relating to children in the entire territory of the country. The Children 's Act which may be enacted by Parliament should contain not only provisions for investigation and trial of offences against children below the age of 16 years but should also contain mandatory provisions for ensuring social, economic and psychological rehabilitation of the children who are either accused of offences or are abandoned or destitute or lost. Moreover, it is not enough merely to have legislation on the subject, but it is equally, if not more, important to ensure that such legislation is implemented in all earnestness and mere lip sympathy is not paid such legislation and justification . for non implementation is not pleaded on ground of lack of finances on the part of the State. The greatest recompense which the State can get for expenditure on children is the building up of a powerful human resource ready to take its place in the forward march of the nation. We have already given various directions by our orders dated 12th July 1986 and 5th August 1986. We have also in the meantime received reports of survey made by several District Judges. We shall take up these matters for consideration at the next hearing of the writ petition which shall take place on 1.9.1986.

On 12th July, 1986 this Court issued various directions in regard to the physically and mentally retarded children as also abandoned or destitute children who are lodged in various jails in the country for 'safe custody '. Giving further directions, HELD: 1. The right to speedy trial is a fundamental right implicit in article 21 of the Constitution. If an accused is not tried speedily and his case remains pending before the Magistrate or the Sessions Court for an unreasonable length of time, it is clear that his fundamental right to speedy trial would be violated unless, of course, the trial is held up on account of some interim order passed by a superior court or the accused is responsible for the delay in the trial of the case. The consequence of violation of the fundamental right to speedy trial would be that the prosecution itself would be liable to be quashed on the ground that it is in breach of the fundamental right. [566E G] Hussainara Khatoon & Ors. vs Home Secretary, State of Bihar, [ , relied upon 2. Every State Government must take necessary measures for the 563 purpose of setting up adequate number of courts, appointing requisite number of Judges and providing them the necessary facilities. It is also necessary to set up an Institute or Academy for training of judicial officers so that their efficiency may be improved and they may be able to regulate and control the flow of cases in their respective courts. [567B C] 3. So far as a child accused of an offence punishable with imprisonment of not more than 7 years is concerned, a period of 3 months from the date of filing of the complaint or lodging of the First Information Report is the maximum time permissible for investigation and a period of 6 months from the filing of the charge sheet as a reasonable period within which the trial of the child must be completed. If that is not done, the prosecution against the child would be liable to be quashed. Every State Government shall give effect to this principle or norm in so far as any future cases are concerned. [567E F] 4. So far as concerns pending cases relating to offences punishable with imprisonment of not more than 7 years, it is directed that every State Government shall complete the investigation within a period of 3 months from today if the investigation has not already resulted in filing of chargesheet and if a chargesheet has been filed, the trial shall be completed within a period of 6 months from today and if it is not, the prosecution shall be quashed. [567F G] 5. The State Governments must set up necessary remand homes and observation homes where children accused of an offence can be lodged pending investigation and trial. On no account should the children be kept in jail and if a State Government has not got sufficient accommodation in its remand homes or observation homes, the children should be released on bail instead of being subjected to incarceration in jail. [565D E] 6. Instead of each State having its own Children 's Act different in procedure and content from the Children 's Act in other States, the Central Government should initiate Parliamentary Legislation on the subject, so that there is complete uniformity in regard to the various provisions relating to children in the entire territory of the country. The Children 's Act which may be enacted by Parliament should contain not only provisions for investigation and trial of offences against children below the age of 16 years but should also contain mandatory provisions for ensuring social, economic and psychological rehabilitation of the children who are either accused of offences or are abandoned or destitute or lost. [568A G] 564

Civil Appeal No. 2295 of 1968. From the Judgment and order dated 3 2 1967 of the Madhya Pradesh High Court in Misc. Petition No. 26 of 1966. Harbans Singh for the Appellant. Raghunath Singh and Manojswarup for Respondent No.1. S.K. Gambhir for Respondents 3 5 and 7. U. P. Lalit,B.P.Muheshwari and Suresh Sethi for Respondent No. 6. The Judgment of the Court was delivered by UNTWALTA, J. In this appeal by certificate granted by the Madhya Pradesh High Court the question of law which Lalls for our determination is whether conferral of Bhumiswalnli rights on Shri Khushi Lal respondent No. 1 in respect of the lands in question in accordance with Section 190 of the Madhya Pradesh Land Revenue Code, 1959, hereinafter referred to as the M.P. Code of 1959, by the Revenue Authorities is correct and sustainable. Maulana Shamsuddin, the sole appellant in this appeal, was a Muafidar in the erstwhile State of Bhopal of the disputed lands in accordance with the Bhopal State Land Revenue Act, 1932 (for brevity, the Bhopal Act of 1932) . The first respondent claimed to be a Shikmi of the appellant in respect of the lands in question. His case was that the appellant was the occupant of the lands within the meaning of the Bhopal Act of 1932. On the coming into force of the M.P. Code of 1959. the appellant became a Bhumiswami under clause (c) of section 158 and the respondent became an occupancy tenant under section 185 (1)(i)(iv)(b).Thus he became entitled to conferment of Bhumiswami rights under Section 490. He applied before the Tahsildar, Huzur, respondent No. 5 for mutation of his name as a Bhumiswami in the Revenue records. The Tahsildar by his order dated the 24th June, 1963 directed Khushi Lal to deposit compensation equivalent to 15 times of the land revenue on the payment of which his name was to be recorded as a Bhumiswami of the holdings. It appears his name was so recorded on the deposit of the compensation money. The appellant filed an appeal before the Sub Divisional officers Huzur, respondent No. 4 from the order of the Tahsildar. His appeal was dismissed by the Sub Divisional officer on the 12th of December, 1963. The appellant failed before the Additional Commissioner, Bhopal, respondent No. 3 on the dismissal of his second appeal on the 25th August 1996. He went in revision before the Board of Revenue, (respondent No. 2 ) . The revision was allowed on the 6th of July, 1965. The 584 Board held that the appellant was not an occupant within the meaning of Section 2(15) of the Bhopal Act of 1932 and consequently the first respondent was not a Shikmi under the said Act. He did not become an occupancy tenant under the M.P. Code of 1959 and, therefore, conferral of Bhumiswami rights on him was erroneous in law. The first respondent filed a Writ Petition in the High Court and succeeded there. The High Court held that the Board was not right in its view of the law. The appellant was an occupant and the respondent No. 1 was a sub tenant (Shikmi) under the Bhopal Act of 1932. Conscquently he became an occupancy tenant entitled to conferment of Bhumiswami rights under the M.P. Code of 1959. The appellant has preferred this appeal in this Court to challenge the decision of the High Court and for restoration of the order of the Board of Revenue. Mr. Harbans Singh, appearing for the appellant, Advanced a very fair and able argument to advocate his cause. He could now and did not dispute that if the appellant was an occupant, the first respondent was a Shikmi under the Bhopal Act of l932 and if that be so then the order of the High Court is unassailable. But he vehemently contended that the appellant was not an occupant. Learned counsel for the respondents controverted his argument. Prima facie the argument, as presented, for the appellant appeared to have substance and force but on a close scrutiny we had no difficulty in rejecting it. Section 2 of the Bhopal Act of 1932 is the definition section and as usual at the outset it uses the phrase "in this Act, unless there is nothing repugnant in the subject or context,". Sub section (5) defines "Alienated land" to mean "land in respect of which, pursuant to a grant made by His Highness the Ruler, Government has, in whole or in part, assigned or relinquished its right to receive land revenue, and includes such village waste and forest as are mentioned in the sanad of the grant " Thereafter the sub section says: "If the land revenue is assigned the person to whom such assignment is made is called a "Jagirdar". If the land revenue is relinquished the person in whose favour such relinquishment is made is called "Muafidar";". Subsection ( l S) provides: " "occupant" means a person who holds land direct from the Government or would do so but for the right of collecting land revenue having been assigned or relinquished. " It would thus be seen that if pursuant to the grant made by His Highness the Ruler of Bhopal, Government 's right to receive land revenue was assigned to the grantee then he was called a Jagirdar and 585 it was relinquished then the person in whose favour such relinquishment was made was called Muafidar. Under the first part of the definition of "occupant" given in sub section (IS) a person who holds land direct from Government would be an occupant and being not a person in whose favour the right to receive land revenue has either been assigned or relinquished will be required to pay to the Government land revenue or rent. We are using both the words revenue ' and 'rent ' on the assumption that such an occupant being neither a Jagirdar nor a Muafidar would be required to pay some money to the Government for being in occupation of the land. Under the second part of the definition a Jagirdar or a Muafidar would also be holding land direct from Government but because the right of collecting land revenue has either been assigned or relinquished, strictly speaking, he does not hold land direct from the Government in the sense of paying any land revenue or rent to it because the Government has parted with the right to collect land revenue from him. We are of the opinion, in agreement with the High Court, that on a careful analysis of the definition of the term "occupant" in section 2(15), it is legitimate to conclude that even a Jagirdar or a Muafidar is an occupant. He holds land under the Government; on the resumption of the Jagir or the Muafirights by the Government the land reverts back to it. Payment of land revenue or rent for holding land under the Government was not a sine qua non for making the holder of the land an occupant. "Rent" is defined in sub section (19) of Section 2 of the Bhopal Act of 1932 to mean "whatever is payable to an occupant in money, kind or service by a shikmi for the right to use land. " This would show that strictly speaking a person holding the land direct from the Government within the meaning of the first part of the definition in sub section (IS) is not to pay any money to the Government in the shape of rent but what he will be required to pay would be the land revenue. But a Jagirdar or a Muafidar holding the land under the Government is not required to pay any land revenue. sub section (21) defines "Shikmi" to mean "a person who holds land from an occupant and is, or but for a contract, would be liable to pay rent for such land to that occupant, but does not include a mortgagee or a person holding land directly from Government. " Respondent No. 1 was inducted upon the land by the appellant in the year 1958. Since then he had been cultivating the land. He could not but be a Shikmi within the meaning of sub section (21 ) . Mr. Harbans Singh was not right in saying that he was a mere cultivator and was cultivating the land not as a sub tenant or a Shikmi but must be doing so under some special arrangement of cultivating the land as a servant of the appellant or the like. There is no warrant for such a contention. 586 Section 46 of the Bhopal Act of 1932 runs thus . "(l) All land to whatever purpose applied and wherever situate, is liable to the payment of revenue to the Government, except such land as has been wholly exempted from such liability by a special grant on His Highness the Ruler or by a contract with the Government, or under the provisions of any law or rule for the time being in force. (2) Such revenue is called "Land Revenue"; and that term includes moneys payable to the Government for land, notwithstanding that such moneys may be described as premium, rent, quit rent, or in any other manner in any enactment, rule, contract or deed." This section lends support to the view which we have expressed above that a person holding land directly under the Government and not being a Jagirdar or a Muafidar will be liable to pay land revenue to the Government in whatever name the payment of money may be described such as premium, rent, quit rent etc. The High Court in its judgment has adverted to some sections contained in Chapter VI of the Bhopal Act of 1932. Section 51 provided for disposal of unoccupied land. Sub section (1) of section 52 says that a person acquiring the right to occupy land under section 51 will be called an occupant of such land and under sub section (2) all persons who, prior to the commencement of this Act, had been entered in settlement records as responsible for the payment of land revenue to the Government, or who, but for a special arrangement, would have been to responsible, would be deemed to be occupants within the meaning of Section 52. In our opinion this special arrangement mentioned in sub section (2) cannot be squarely equated with the assignment or relinquishment of the right to receive land revenue envisaged by the Bhopal Act of 1932. We do not feel inclined to agree with the High Court that the appellant became occupant under section 52(2) of the Bhopal Act of 1932 because he was a person who was entered into settlementt records prior to the coming into force of that Act. Firstly it is not clear whether the facts so stated in the judgment of the High Court are (quite correct, and, secondly, it is admitted on all hands that the appellant was a Muafidar and, therefore, in our opinion he was an occupant within the meaning of Section 2(15). Section 54 provided that the rights of an occupant, meaning thereby the occupant as mentioned. in Section 52, were to be permanent, transferable and heritable. Ordinarily and generally the rights of a Jagirdar 587 or a Muafidar being occupants within the meaning of Section 2(15) A read with Section 167 were neither transferable nor heritable and in that sense the rights were not permanent. In our opinion, therefore, the type of occupant who is dealt with in Chapter VI of the Bhopal Act of 1932 is not the type of occupant having the same kind of incidence as defincd in Section 2(15). As we have already indicated it is a well established principle of law that a particular term defined in the definition section is subject to anything repugnant in the contact of the other provisions of the Statute. The provisions of Chapter VI being at variance with the definition clause cannot make the occupant described in that Chapter the same occupant as defined in Section 2(15). Our attention was drawn by the learned counsel for the appellant to Section 167 of the Bhopal Act of 1932 dealing With the restriction ill the rights of the Jagirdars and Muafidar to transfer such rights or create encumbrances on them. According to the said Section no Jagirdar or Muafidar could "transfer his rights as Jagirdar or muafidar, or, except for such period as he is in possession of his jagir or muafi create an encumbrance on the income thereof." But inducting a person as Shikmi on the land was not prohibited under Section 167. On the other hand, Section 194 provide(l that all occupant could make a lease of his holding and under certain circumstances it could n(lt be for a term of more than 12 years. It was then argued that the right of a Muafidar being in the nature of a life grant was valid only for the Life time of the Muafidar. So the Muafidar could not induct a person as Shikmi who ultimately could become an occupancy tenant entitled to conferment of Bhumisavami rights later on. This argument has to be staled merely to be rejected. It may well be that the right of a Shikmi would not have lasted beyond the duration of the right of the Muafidar. But then, his rights were enlarged by operation or the welfare legislation enacted by the State Legislature for the benefit of the cultivators of the soil in the year 1959. Section 185(1)(iv)(b) of the M.P. Code of 1959 says: "(1) Every person who at the coming into force of this Code holds (iv) in the Bhopal region (b) any land as a shikmi from an occupant as defined in the Bhopal State Land Revenue Act, 1932 (IV of 1932): 588 shall be called an occupancy tenant and shall have all the rights and be subject to all the liabilities conferred or imposed upon an occupancy tenant by or under this Code. " As held by us above the appellant was an occupant as defined in the Bhopal Act of 1932 and thus under clause (c) of Section 158 on the coming into force of the Code he became a Bhumiswami. But his Bhumiswami rights were liable to be conferred, under certain conditions, on the occupancy tenant under Section 190. As a matter of fact in accordance with the said provision the Bhumiswami rights were conferred on respondent No. 1 on payment of compensation being in the amount of 15 times of the land revenue for payment to the appellant. Our attention was drawn to a recital of facts in the Statement of the case of some of the respondents that the appellant had withdrawn the said amount of compensation. But we are not resting our judgment on that ground as in our opinion, whether he has withdrawn the amount of compensation or not, he cannot challenge the conferment of his Bhumiswami rights on respondent No. l. which have been validly and legally conferred. We may now briefly deal with a few more short submissions of the appellant. In section 185(1)(iv)(a) of the M.P. Code of 1959 it is provided that if a person who at the time of coming into force of tba said Code was holding any land as a sub tenant as defined in the Bhopal State Sub tenants Protection Act, 1952 shall also be called an occupancy tenant. A copy of this Act could not be made available for our perusal. But what we get from the order of the Board of Revenue is that a Sub tenant as defined in the Bhopal Act of 1952 means a person who holds a parcel of khud kasta land from a Jagirdar. Along with this our attention was also drawn to the Bhopal State Sub Tenants (of occupants) Protection Act. In this Act, section 2(b) runs thus: "The expression "occupant" shall have the same meaning as in the Bhopal State Land Revenue Act, 1932 (IV of 1932) and, for the purposes of this Act, it should also include a muafidar, as defined in Bhopal State Land Revenue Act, 1932 (IV of 1932)". In other sections of the said Act protection against ejectment was given to the Shikmis. The argument was that protection to the sub tenants of Jagirdars was given in the Bhopal Act of 1952 and protection to such persons was given in case of sub tenants of Muafidar under the Bhopal Act of 1954 by including Muafidar in the expression 'occupant ' occurring in the said Act. Counsel, therefore, submitted that if the 589 term 'occupant ' in the Bhopal Act of 1932 had included a Muafidar then there was no necessity of expressly and separately including a Muafidar in the definition of the said expression. in the Act of 1954. In our opinion this argument has no substance. It may be by way of abundant precaution or for putting the matter beyond any shadow of doubt that the expression 'occupant ' was defined in a comprehensive manner in the Bhopal Act of 1954. Section 3 of the said Act shows that even a Muafidar could sub let a land to a person and induct hi as a Shikmi prior to the coming into force of this Act. Such a Shikmi got the protection against ejectment by operation of law engrafted in the Bhopal Act of 1954. After the passing of this Act? he no longer could be said to be a Shikmi only during the life time of the Muafidar but was so even beyond it. The counsel for the appellant called our attention to a decision of this Court in Begum Suriya Rashid and others vs Stale of Andhra Pradesh(l). In this case it was held that the muafi grants to the predecessor in interest of the appellants before the Supreme Court were not hereditary or perpetual and the appellants could not claim title as Muafidars even though some contradictory arabic expressions had keen used in the document of grant. This decision does not advance the case of the appellant any further. For the reasons stated above, we dismiss this appeal but make no order as to costs. M.R. Appeal dismissed.

The appellant was a Muafidar of the disputed land, in the erstwhile Bhopal State, while the first respondent cultivated the said lands as his tenant. When the M. P. L. R. Code, 1959, came into force, the first respondent claimed that the appellant, as the occupant of the lands within the meaning of S.2 (15) of the Bhopal State Revenue Act, 1932, had become a Bhumiswami u/s 158(C) of the Code of l959, while he himself had become an occupancy tenant u/s 185(1)(iv)(b) and as such, was entitled to conferment of Bhumiswami rights u/s 190 of the same Code. He ' applied to the Tahsildar, Huzur, for mutation of his name as a Bhumiswarni in the Revenue records. and was directed to deposit compensation equivalent to 15 times of the land revenue. Thereafter his name was recorded as a Bhumiswami of the holdings, on the deposit of the compensation money. The Muafidar appellant 's appeal to the sub Divisional officer, against the Tahsildar 's order, and a second appeal to the additional Commissioner. were dismissed, but the Board of Revenue allowed his revision application holding that he was not an occupant within the meaning of section 2(15) of the Bop Act of ]932. and that consequently the first respondent was neither a Chime, nor did he become an occupancy tenant under the M.P. Code of 1959, and therefore conferment of Bhumiswami rights on him was erroneous in law. , The first respondent filed a writ petition against the Revenue Board 's order, which was allowed by the High Court. Dismissing the appeal by certificate, the Court ^ HELD: 1. Under section 2(15) of the Bhopal State Land Revenue Act 1932, a person who holds and direct under the Government would be an ` 'occupant", in whatever name the payment of money may be described such as premium, rent, quit rent etc. On a careful analysis of the definition, it is legitimate to conclude that a Jagirdar or Muafidar is an occupant. He holds lands under the Government. On the resumption of the Jagir or the Muafi rights by the Government, the land reverts back to it. Payment of land revenue or rent for holding land under the Government was not a sine qua non for making the holder of the land an revenue. [585 A D, 586 D] Begum Suriya Rashid and Ors. vs State of Madhya Pradesh [19691] 1 SCR 869 held inapplicable. The rights of Shikmis were enlarged by operation of tile Madhya Pradesh Land Revenue Code. Under section 185(l)(iv)(b) a Shikmi became an occupancy tenant, while u/s 190, as an occupancy tenant, he became entitled, under certain conditions, to conferment of Bhumiswami rights of the occupant of he holdings. A B] 583

ivil Appeal Nos. 636 639 of 1971. From the Judgment and Order dated 14.5.1963 of the Allahabad High Court in F.A. Nos. 239/1945, 171/1946, 239/1945, and 171/46 respectively. V.K.S. Chaudhury, V.V. Misra. S.S. Khanduja, A.S. Pundir, Dhirendrajit Singh, Mahfooz Khan and Y.P. Dhingra for the Appellants, in C.A. Nos. 636 37 of 1971. V.K.S. Chaudhury and B.P. Maheshwari for the Appellants in C.A. Nos. 638 39 of 1971. Vinoo Bhagat for the Lrs. of Appellant No. 1 in C.A. Nos. 638 39 of 1971. J.P. Goyal, V.K. Verma, Rajash, Raghunath Singh, M.P. Jha, and T.C. Sharma for the Respondents. The Judgment of the Court was delivered by Misra J. These appeals by certificate are directed against the common judgment and order of the High Court of Judicature at Allahabad dated May 14, 1963. As the appeals raise common questions of fact and law they are being disposed of by a common judgment. The circumstances leading up to these appeals are as follows. One Lala Gurdin acquired considerable landed property in villages Patara, Mubarakpur Lata, Madanpur, Gosra and Jeora Nawabganj in Kanpur. He had no male issue. He died on December 10, 1861 leaving behind his widow Smt. Amrit Kuer and three daughters: Smt. Hazaro Kuer from his predeceased wife, and Smt. Mewa Kuer and Smt. Prago Kuer from Smt. Amrit Kuer. After the death of Gurdin his entire estate came into the hands of his widow, Smt. Amrit Kuer. Amrit Kuer also died on August 1, 1880. During her life time she made certain alienations but those alienations are not relevant in the present appeals. After her death the three daughters of Lala Gurdin succeeded to the estate left by Smt. Amrit Kuer, as limited owners. Soon after the succession the three daughters divided the property amongst themselves and they came in possession of 722 one third share each. When Smt. Prago Kuer, one of them, died on July 8, 1907 the estate remained with the two surviving daughters. When Smt. Hazaro Kuer, the other daughter, died on January 24, 1914 the estate remained in possession of Smt. Mewa Kuer, the last surviving daughter. She also died on June 14, 1923. During their life time the three daughters had been making various alienations of the property that fell to their exclusive share. Mewa Kuer also made a number of alienations in favour of different persons at different times. We are concerned in the present appeals with sale deeds dated July 27, 1901; July 17, 1914 and October 19, 1915. The sale deed dated July 27, 1901 was executed by Smt. Mewa Kuer to one Ram Narain in respect of the entire Mahal Mewa Kuer and 2 anna 8 pie share in Mahal Katri. Ram Narain 's successors in their turn sold the suit property by means of two sale deeds one dated July 14, 1919 in favour of Rai Sahib Lala Gopi Nath who is dead and is represented by defendants 19 to 23 in suit No. 25 of 1935 and the other dated January 2, 1920 in favour of Brahmvart Sanathan Dharam Mahamandal, Kanpur, hereinafter referred to as the trust, and arrayed as defendant No. 8 in suit No. 25 of 1935. Mewa Kuer further executed a sale deed on July 17, 1914 in favour of two brothers, Kundan Lal Tiwari and Balbhadar Tiwari, hereinafter referred to as the Tiwari brothers, in respect of nine specific plots in Mahal Hazaro Kuer. Ram Dayal son of Smt. Mewa Kuar also joined Smt. Mewa Kuer in the execution of this sale deed. Tiwari brothers in their turn sold some of the property to Gopi Nath on February 21, 1920. Tiwari brothers also executed a gift deed dated October 12,1919 in respect of 8 bighas and odd pertaining to Mahal Prago Kuer and 5 bighas and 16 biswas in Mahal Hazaro Kuer to the aforesaid trust. Mewa Kuer and Ram Dayal again executed a sale deed dated October 19, 1915 in respect of 8 anna share in Mahal Prago Kuer and one anna 4 pie share in Mahal Katri to defendants 4 and 5 in suit No. 25 of 1935. After the death of Smt. Mewa Kuer, the last surviving daughter, on July 14, 1923 the succession opened in favour of daughters ' sons of Lala Gurdin, Maharaj Bahadur and Bijay Bahadur, the sons of Smt. Hazaro Kuer, and Ram Dayal the son of Smt. Mewa Kuer. Ram Dayal also died in 1931 leaving behind his son Madho Dayal. After 723 the death of Ram Dayal the reversioners sought to challenge the various alienations made by the limited owners, some by Smt. Amrit Kuer and the others made by the daughters of Lala Gurdin. Suit No. 25 of 1935 was filed by Kunwar Maharaj Bahadur and Kunwar Bijay Bahadur along with their financier Sukhraj Bux Singh for possession in respect of their two third share of the property, for demolition of the valuable constructions raised on the said property and for recovery of mesne profits against the transferees or the subsequent purchasers from those transferees. Suit No. 34 of 1935 was filed by Madho Dayal son of Ram Dayal for the same reliefs in respect of the remaining one third share. The alienations were challenged by the plaintiffs on the allegations that there was no legal or pressing necessity for the transfers and that transfer by one of the daughters without the consent of the remaining daughters was void ab initio and no title passed on to the transferees. It was further alleged that the transferees from the limited owners themselves had no valid title and so they could not pass a better title to others and thus those transfers were also bad. The suits were contested by the various defendants by filing separate written statements. It is, however, not necessary to give details of the various written statements filed in the case, suffice it to say that the defence in the main was that the transfers were for legal and pressing necessity and that there has been a complete partition amongst the three daughters of Lala Gurdin and each one of them was in separate possession of one third share of the estate and, therefore, each was competent to transfer the property without the consent of the other limited owners, that some of the defendants viz. the trust, defendant No. 8 in suit No. 25 of 1935 had raised a double storied building of Sanatan Dharam Degree College, Principal 's quarter, quarters for the teachers, hostel for the students, dispensary and library building at a heavy cost of rupees 4 to 5 lacs. Likewise defendants Nos. 19 to 23 in suit No.25 of 1935 had raised a costly residential building, swimming pool etc. at a cost of more than a lac of rupees. It was further asserted that the transfer by one daughter without any objection from the other daughters will be presumed to have been made with the consent of the other daughters. The defendants also sought the protection of section 43 of the Transfer of Property Act inasmuch as after the death of the two daughters Smt. Mewa Kuer became the sole heir and the transfers made by her during the life time of other daughters will be protected on the equitable principle of feeding the grant by estoppel. The 724 Additional Civil Judge who tried the suit found that sale deed dated 27th July 1901 was for legal necessity but as it was executed without the consent of the other two daughters it was invalid and not binding on the plaintiffs. As regards the sale deeds dated July 17, 1914 and October 19, 1915 the learned Judge found them to be for legal necessity. These sale deeds had been executed by Smt. Mewa Kuer when her two sisters had died. Consequently the trial court dismissed suit No. 25 of 1935 in respect of the sale deeds dated July 17, 1914 and October 19, 1915. This suit was, however, decreed against defendants Nos. 19 and 20 to 23 for recovery of Rs. 3200 in respect of the plaintiffs share on the present market value of the land of Khata Khewat No. 4 (area 8 bighas) Mahal Mewa Kuer, village Jeora Nawabganj and for recovery of Rs. 10,200 as plaintiffs two third share on the present market value of the 30 plots (total area 15 bighas 17 biswas) entered as Khata Khewat No. 7 of Mahal Mewa Kuer, village Jeora Nawabganj as against the trust, defendant No. 8. Those defendants were directed to pay the said amounts within six months of the judgment becoming final. In case of default the plaintiffs shall become entitled to recover the said amount. The learned Judge did so in view of section 51 of the Transfer of Property Act on the ground that those defendants had made valuable constructions as bona fide purchasers. The learned Judge has recorded findings with respect to various other transfers against various defendants but they are not relevant for the purposes of the present appeals. Suit No. 34 of 1935 filed by Madho Dayal in respect of his one third share was also partly decreed and partly dismissed. As against defendant No. 8, the trust, it was decreed for recovery of Rs. 5100 as plaintiffs one third share on the present market value of 30 plots (total area 15 bighas 17 biswas) entered as Khata Khewat No. 7 of Mahal Mewa Kuer village Jeora Nawabganj. It was also decreed against defendants Nos. 21 and 22 to 25 for recovery of Rs. 1600 on account of one third share of plaintiffs on the present market value of the land of Mahal Mewa Kuer, village Jeora Nawabganj. But it was dismissed in respect of Mahal Hazaro Kuer and Mahal Prago Kuer of village Jeora Nawabganj as the plaintiffs ' father was also an executant of the sale deeds along with Mewa Kuer. The judgment of the learned Judge gave rise to appeals by the plaintiffs and cross objections by the present defendants appellants 725 against that part of the judgment and decree which went against them. The High Court reversed the finding of the trial court with regard to the sale deeds dated July 17, 1914 and October 19, 1915 and held that they were not for legal and pressing need. It, however, confirmed the finding of the trial court with regard to sale deed dated July 27, 1901 but held that the plaintiffs should be given an opportunity to make an election under section 51 of the Transfer of Property Act, as to whether they would like to pay the compensation for the super structures standing on the land in question or to sell their share in the land. Consequently, the High Court allowed the appeals of the plaintiffs in part and remanded the case to the trial court to afford an opportunity to the plaintiffs to make election under section 51 of the Transfer of Property Act. As the sale deeds dated July 17, 1914 and October 19, 1915 were not for legal necessity the subsequent transfers made by the transferees of Mewa Kuer were also bad. Shri V.K.S. Choudhury assisted by Shri S.S. Khanduja contended that: 1 The High Court erred in holding that the alienations made by one daughter to the exclusion of the other daughters was a bad transfer inasmuch as: (a) the property having been divided by the three daughters the alienation made by one of them for legal necessity was valid and binding on the other, and (b) the property having been divided there was implied consent of the other daughters for alienations. 2 The sale by one daughter without the consent of the other in any case is not void but voidable. 3 The appellants in any case were entitled to the protection of section 43 of the Transfer of Property Act. 4 The High Court erred in interfering with the exercise of discretion of the trial court under section 51 of the Transfer of Property Act. 726 5 In any case the High Court erred in directing the determination of market value of the property on the date of choice and not on the date of the transfer. In support of his first contention that the transfer by one daughter without the consent of the other daughters was valid the learned Counsel sought to rely upon the original texts. Shri J.P. Goel, counsel for the plaintiff respondents, however, supported the judgment of the High Court by referring to the Privy Council decisions of this Court. As the point involved in this case is no more res integra but has been well settled by the decisions of the Privy Council and of the Indian High Courts we did not permit the counsel to enter into archaeological survey of the original text books. The learned counsel for the appellants, however, tried to distinguish those cases on the ground that those cases mostly were the cases of co widows but in the instant case we are concerned with the transfers made by the daughters. In our opinion what is applicable to co widows is equally applicable to the case of daughters. No distinction can be made on that account. The Hindu Law by M.R. Raghavachariar, 5th Edn. 1965, p. 585 summarised the legal position in the following terms: "Where two widows succeed as co heiresses to their husband 's estate, one of them cannot alienate the property without the consent of the other even though the alienation is for the necessity of the estate. They are entitled to obtain a partition of separate portions of the property and deal as each pleases with own life interest, but she cannot alienate any part of the corpus of the estate by gift or will so as to prejudice the rights of the survivor or a future reversioner. If they act together, they can burden the reversion with any debts contracted owing to legal necessity, but one of them acting without the authority express or implied of the other cannot prejudice the right of survivorship by burdening or alienating any part of the estate. The mere fact of partition between the two, while it gives each a right to the fruits of separate estate assigned to her, does not imply a right to prejudice the claim of the survivor to enjoy the full fruits of the property during her lifetime and a mortgage by a Hindu widow even for necessary purposes, when she has not even asked 727 her co widow to consent to the granting of the mortgage, is not binding upon the joint estate so as to affect the interest of the surviving widow, and the mere fact that there has been enmity between the co widows is no justification for the failure to ask the consent of the co widow. But in cases where the concurrence of a co widow has been asked for to a borrowing by the other for necessary purposes and unreasonably refused, a mortgage for such debt granted only by one widow might be held binding on what may be termed the corpus of the estate. " The question of alienation and co widows has been exhaustively considered with reference to the whole case law thereon in a decision of the Madras High Court in Appalasuri vs Kannamma referred to with approval by the Privy Council in Gauri Nath Kakaji vs Mt. Gaya Kuer in which following propositions of law were laid down: (1) The estate of co widows or other co heiresses in Hindu Law is a joint estate, but it is unlike other joint estates. It is indivisible. Strictly it can never be divided, so as to create separate estates such that each sharer is the owner of her share and at her death, the reversioner 's estate falls in. Such a division is impossible in law. (2) Such partition as is permissible is merely for the convenience of their enjoyment by the sharers; (i) so as to last during the lifetime of both the widows; (ii) so as to bind them until the death of all of them. In the latter case, if one of the widows dies before the other, without alienating the property, it passes to the heirs of her private property and not to the other co widow, or their reversioners. 728 (3) By the very nature of the arrangement, there can be no survivorship, if the partition is of the second kind. But if it is of the first kind, it cannot affect the right of survivorship of other. (4) One of the co widows can alienate her share, which may be defined or undefined, according as there is a partition or not. If the alienor dies before the co widow, the alienation ceases to be operative, if there is no partition, or if the partition is of the first kind, the property goes to the co widow by survivorship. But if the partition is of the second kind, the property continues to be enjoyed by the alienee until the other co widow dies. (5) Except for the limited purposes mentioned above, i.e., during the lifetime of the alienor in a partition of the first kind, or during the lifetime of all the co widows in a partition of the second kind, there can be no alienation by a widow of her interest, and whether there is necessity or not, an alienation by one co widow cannot bind the reversioner. (6) If an alienation for necessity is to bind the reversioners, all the co widows must join in it. " In this view of the legal position it is not open to the counsel for the appellant to take up the matter afresh by referring to the original texts. The general law is now so well settled that it scarcely requires restatement. If a Hindu dies leaving behind two widows they succeed as joint tenants with a right of survivorship. They are entitled to obtain partition of the separate portions of property so that each may enjoy her equal share of the income accruing therefrom. Each can deal as she pleases with her own life interest but she cannot alienate any part of the corpus of the estate by gift or will so as to prejudice the right of survivorship or a future reversioner. If they act together they can burden the reversion with any debts owing to legal necessity but one of them acting without the authority of the other cannot prejudice the right of survivorship by alienating any 729 part of the estate. The mere fact of partition between the two while it gives each a right to fruits of separate estate assigned to her, it does not imply a right to prejudice the claim of the survivor to enjoy full fruits of the property during her lifetime. It was, however, contended for the appellants that in the circumstances of the present case consent of the other daughters will be presumed. The alienations made by the daughters separately to different persons was never challenged by the other daughters. Even the reversioners did not challenge those alienations during the lifetime of their mothers and they sought to challenge the alienations long after the death of the last limited owner Smt. Mewa Kuer in 1923 and even if the partition between the daughters had no effect on the reversion it can safely be presumed that the transfer made by one of the daughters of the property exclusively in her possession had the consent of the other. We find considerable force in this contention. This aspect of the case has been completely lost sight of by the High Court. The transfer made by one daughter without the consent of the other is only voidable at the instance of the other co limited owners or at the instance of the reversioners. In any case Smt. Mewa Kuer after the death of her two sisters came into exclusive possession of the entire estate left by Smt. Amrit Kuer, widow of Lala Gurdin. Therefore, the transferees would be entitled to the protection of section 43 of the Transfer of Property Act which substantially amounts to satisfying the equitable principle of `feeding the grant by estoppel '. This question however loses its importance if once we presume the consent of the other sisters in the circumstances of the present case. It was contended for the appellants that the plaintiffs had accepted the amount evaluated by the trial court for the land before the filing of the appeal in the High Court and, therefore, it was not open to the plaintiffs to challenge the amount of compensation fixed by the trial court, and in any case the amount of compensation could not be fixed at the market value prevailing at the time of making the choice because the prices of constructions and the lands had gone exorbitantly high and it will not be possible either for the plaintiffs or for the defendants to pay the price according to the present market value. No wonder in these circumstances the plaintiffs accepted the amount of the compensation fixed by the trial court. 730 The counsel for the respondents, however, contends that the acceptance of the amount fixed by trial court was without prejudice to their rights and, therefore, they cannot be estopped from challenging the same. In view of the fact that the trust has made valuable constructions involving a cost of 5 to 6 lakh rupees of the college building, the principal 's quarters, teachers quarters, hostel, library, dispensary etc., in our opinion it will be inequitable in the circumstances of the case to ask the appellants to pay the present market value of the land. The acceptance of the amount by the plaintiffs determined by the trial court will itself amount to making a choice within the meaning of section 51 of the Transfer of Property Act. From the materials on record and the attending circumstances it is obvious that a the reversioners were neither in a position to pay for the improvements nor inclined to do so and this is why they accepted the amount determined by the trial court. In the circumstances of the case we are satisfied that the High Court was not justified in remanding the case to the trial court to afford another opportunity to the plaintiffs to make a fresh choice. The learned counsel half heartedly sought to challenge the finding of the High Court in respect of the sale deeds dated July 17, 1914 and October 19, 1915 on the ground that it had lost sight of the reasons given by the trial court for holding that those transfers will be presumed to have been executed for legal necessity in view of the circumstances enumerated by the trial court. What quantum of evidence will satisfy a particular court to come to a conclusion is entirely in the discretion of the court. It is not possible to interfere with the finding of the High Court with regard to the two sale deeds dated July 17, 1914 and October 19, 1915. For the foregoing discussion the appeals must succeed. They are accordingly allowed in part and the judgment of the High Court remanding the case to the trial court for affording another opportunity to the plaintiff respondents to make election is set aside and the judgment of the trial court with regard to sale deed dated July 27, 1901 is restored. There is, however, no order as to costs. S.R. Appeal partly allowed.

One Lala Gurdin, who had acquired extensive landed property in Kanpur died on December 10, 1861 leaving behind his widow Smt. Amrit Kuer and three daughters: Smt. Hazarao Kuer from his predeceased wife, and Smt. Mewa Kuer and Smt. Prago Kuer from Smt. Amrit Kuer. After the death of Gurdin his entire estate came into the hands of his widow Smt. Amrit Kuer and after her death on August 1,1880, the three daughters of Lala Gurdin succeeded to the estate left by Smt. Amrit Kuer, as limited owners. They divided the property amongst themselves, each coming into possession of one third share. When Smt. Prago Kuer died on July 8, 1907 the estate remained with the two surviving daughters. When Smt. Hazaro Kuer died on January 24, 1914 the estate remained in possession of Smt. Mewa Kuer, the last surviving daughter. She also died on June 14,1923. During their life time the three daughters had been making various alienations of the property that fell to their exclusive share. Amongst a number of alienations in favour of different persons at different times, three sale deeds dated July 27,1901; July 17, 1914 and October 19,1915 are the subject matter of the appeals and the property covered by the 1901 and 1914 sale deeds are in possession of the appellants trust while the properties covered by the 1915 sale deeds are in the possession of Defendants 4 & 5 of Suit No. 25 of 1935. The 1914 and 1915 sale deeds were jointly executed by Smt. Mewa Kuer and her son Ram Dayal. After the death of Smt. Mewa Kuer in 1923, her surviving reversioners sought to challenge the various alienations made by the limited owners, some by Smt. Amrit Kuer and the others made by the daughters of Lala Gurdin by way of two Suits Nos. 25 of 1935 filed by the two sons of Smt. Hazaro Kuer and Suit No. 34 of 1935 filed by Madho Dayal son of Ram Dayal, on the 719 allegations (i) that there was no legal or pressing necessity for the transfers; (ii) that transfer by one of the daughters without the consent of the remaining daughters was void ab initio and no title passed on to the transferees; and (iii) transferees from the limited owners themselves had no valid title and so they could not pass a better title to others and thus those transfers were also bad. The suits were contested by the transferees in possession seeking protection of section 43 of the Transfer of Property Act on the equitable principle feeding the Grant by estoppel in as much as even if there was any defect in the of title Mewa Kuer, the same has ceased when her two other sisters died and she become the sale Survivor. The Additional Civil Judge found that, while sale deeds of 1914 and 1915 were for legal necessity as they had been executed by Smt. Mewa Kuer when her two sisters had died, the sale deed dated 27th July, 1901 was also for legal necessity but as it was executed without the consent of the other two daughters it was invalid and not binding on the plaintiffs respondent. Consequently the Trial Court dismissed Suit No. 25 of 1935 in respect of the sale deeds of 1914 and 1915, and partly decreed the suit pertaining to 1901 sale deed in view of the provisions of section 51 of the Transfer of Property Act in as much as these defendants appellants had made valuable constructions as bona fide purchasers and they were entitled to the market value of the constructions. Suit No 34 of 1935 was also partly decreed and partly dismissed. In the appeals filed by the present respondents plaintiffs and after perusing the cross objections filed by the present defendants appellants, the High Court reversed the finding of the trial court with regard to sale deeds of 1914 and 1915 held that they were not for legal and pressing need; and while confirming the finding of the trial court with regard to sale deeds dated July 27, 1901 further held that the present plaintiffs respondents should be given an opportunity to make an election under section 51 of the Transfer of Property Act, as to whether they would like to pay the compensation for the superstructures standing on the land in question or to sell their share in the land. Consequently, the High Court allowed the appeals of the plaintiffs respondents in part and remanded the case to the trial court to afford an opportunity to the plaintiff to make election under section 51 of the Transfer of Property Act. It was further held that the sale deeds of 1914 and 1915 being not for legal necessity the subsequent transfers made by the transferees of Mewa Kuer were bad. Hence the appeals by certificate. Allowing the appeals in part, the Court ^ HELD 1.1 If a Hindu dies leaving behind two widows they succeed as joint tenants with a right of survivorship. They are entitled to obtain partition of the separate portions of property so that each may enjoy her equal share of the income accruing therefrom. Each can deal as she pleases with her own life interest but she cannot alienate any part of the corpus of estate by gift or will so as to prejudice the right of survivorship or a future reversioner. If they act together they can burden the reversion with any debts owing to legal necessity but one of them acting without the authority of the other cannot prejudice the 720 right of servivorship by alienating any part of the estate. [728 G H] 1.2 The mere fact of partition between the two while it gives each a right to fruits of separate estate assigned to her, it does not imply a right to prejudice the claim of the survivor to enjoy full fruits of the property during her life time. What is applicable to co widows is equally applicable to the case of daughters. No distinction can be made on that account. [726 C D, 729 A B] Gauri Nath Kakaji vs Mt. Gaya Kuer, followed. Appalasuri vs Kannamma, approved. 2.1 The transfer made by one daughter without the consent of the other is only voidable at the instance of the other co limited owners or at the instance of the reversioners. [729 D E] 2.2 Here, the alienations made by the daughters separately to different persons was never challenged by the other daughters. Even the reversioners did not challenge those alienations during the life time of their mothers and they sought to challenge the alienations long after the death of the last limited owner Smt. Mewa Kuer in 1923 and therefore, even if the partition between the daughters had no effect on the reversion it can safely be presumed that the transfer made by one of the daughters of the property exclusively in her possession had the consent of the other. Further in any case Smt. Mewa Kuer after the death of her two sisters came into exclusive possession of the entire estate left by Smt. Amrit Kuer, widow of Lala Gurdin. Therefore, the transferees would be entitled to the protection of section 43 of the Transfer of Property Act which substantially amounts to satisfying the equitable principle of 'feeding the grant by estoppel '. [729 B C, D E] 2.3 In view of the fact that the trust has made valuable constructions involving a cost of 5 to 6 lakh rupees of the college building, the principal 's quarters, teacher 's quarters, hostel, library, dispensary etc. it will be inequitable in the circumstances of the case to ask the appellants to pay the present market value of the land. The acceptance of the amount by the plaintiffs respondents as determined by the trial court will itself amount to making a choice within the meaning of section 51 of the Transfer of Property Act. From the materials on record and the attending circumstances it is clear that the reversioners were neither in a position to pay for the improvements nor inclined to do so and this is why they accepted the amount determined by the trial court. Therefore, the High Court was not justified in remanding the case to the trial court to afford another opportunity to the plaintiffs to make a fresh choice. [930 B D] 3. What quantum of evidence will satisfy a particular court to come to a conclusion is entirely in the discretion of the Court, and therefore, the finding of the High Court with the regard to the two sale deeds of 1914 and 1915 cannot be interfered with. [930 E F] 721

Appeal No. 428 of 1959. Appeal from the judgment and order dated February 25, 1959, of the Punjab High Court (Circuit Bench) at Delhi in Letters Patent Appeal No. 47 D of 1955, arising out of the judgment and order dated November 28, 1955 of the said High Court in Writ Petition No. 306 D of 1954. N. C. Chatterjee, J. B. Dadachanji, section N. Andley, Rameshwar Nath and P. L. Vohra, for the appellant. C. K. Daphtary. Solicitor General of India, R. Gapapathy Iyer, R. H. Dhebar and T. M. Sen, for respondents Nos. 1 & 2. G. section Pathak, section section Shukla and Mrs. E. Udayaratnam, for respondent No. 3. 1960. January 19. The Judgment of the Court was delivered by WANCHOO J. This appeal upon a certificate granted by the Punjab High Court raises the question whether an order of the Central Government under r. 54 of the Mineral Concession Rules, 1949, (hereinafter called the Rules) framed under section 6 of the Mines and Minerals (Regulation and Development) Act, No. 53 of 1941, (hereinafter called the Act) is quasi judicial or administrative. The brief facts necessary for this purpose are these. The appellant was granted a mining lease by the then Ruler of Gangpur State on December 30, 1947, shortly before the merger of that State with the State of Orissa on January 1, 1948. This lease was annulled on June 29, 1949. Thereafter the appellant was granted certificates of approval in respect of prospecting licences and mining leases. Eventually, the appellant applied on December 19, 1949, for mining leases for manganese in respect of five areas in the district of Sundergarh (Orissa). He was asked on July 4, 1950, to submit a separate 777 application for each area which he did on July 27, 1950. Some defects were pointed out in these applications and therefore the appellant submitted fresh applications on September 6, 1950, after removing the defects. In the meantime, the third respondent also made applications for mining leases for manganese for the same area on July 10, 1950. These applications were not accompanied by the deposit required under r. 29 of the Rules. Consequently, the third respondent was asked on July 24, 1950, to deposit a sum of Rs. 500, which it did on August 3, 1950. It was then found that the third respondent 's applications were defective. It was therefore asked on September 5, 1950, to send a separate application in the prescribed form for each block and thereupon it submitted fresh applications on September 6, 1950. Eventually, on December 22, 1952, the State of Orissa granted the mining leases of the five areas to the appellant taking into account r. 32 of the Rules, which prescribed priority. It was held that the appellant 's applications were prior and therefore the leases were granted to him. Thereafter on April 21, 1953, possession of the areas leased was delivered to the appellant. It seems, however, that the third respondent had applied for review to the Central Government under r. 52 of the Rules. This review application was allowed by the Central Government on January 28, 1954, and the Government of Orissa was directed to grant a mining lease to the third respondent with respect to two out of the five areas. The appellant 's complaint is that he came to know in February, 1954, that the third respondent had applied to the Central Government under r. 52 for review. He thereupon addressed a letter to the Central Government praying that he might be given a hearing before any order was passed on the review application. He was, however, informed on July 5, 1955, by the Government of Orissa of the order passed by the Central Government on January 28, 1954, by which the lease granted to him by the State of Orissa with respect to two areas was cancelled. Consequently, he made an application under article 226 of the 778 Constitution to the Punjab High Court praying for quashing the order of January 28, 1954, on the ground that it was a quasi judicial order and the rules of natural justice had not been followed inasmuch as he had not been given a hearing before the review application was allowed by the Central Government, thus affecting his rights to the lease granted by the State of Orissa. The writ petition was heard by a learned Single Judge of the High Court and it was held that the order was not a quasi judicial order but merely an administrative one and that there being no lis, the appellant was not entitled to a hearing. In the result, the writ petition failed. The appellant went up in Letters Patent Appeal to a Division Bench of the High Court, which upheld the order of the learned Single Judge. The appellant then applied for a certificate to permit him to appeal to this Court which was granted; and that is how the matter has come up before us. Shri N. C. Chatterji appearing on behalf of the appellant contends that the Central Government was acting in a quasi judicial capacity when it passed the order under r. 54 of the Rules and therefore it was incumbent upon it to hear the appellant before deciding the review application, and inasmuch as it did not do so it contravened the principles of natural justice which apply in such a case and the order is liable to be quashed. In support of this, learned counsel relies on Nagendra Nath Bora and another vs The Commissioner of Hills Division and Appeals, Assam and others (1), and submits that rr. 52 to 55 of the Rules which are relevant for the purpose clearly show that the proceeding before the Central Government is a quasi judicial proceeding in view of the following circumstances appearing from these rules: (1) Rule 52 gives a statutory right to any person aggrieved by an order of the State Government to apply for review in case of refusal of a mining lease; (2) It also prescribes a period of limitation, namely, two months; (3) Rule 53 prescribes a fee for an application under r. 52. These circumstances taken with the circumstance that a lis is (1) ; 779 created as soon as a person aggrieved by an order is given the right to go up in review against another person in whose favour the order has been passed by the State Government show that the proceeding before the Central Government at any rate at the stage Of review is quasi judicial to which rules of natural justice apply. Mr. G. section Pathak appearing for the third respondent on the other hand contends that the view taken by the High Court is correct and that the order of January 28, 1954, is a mere administrative order and therefore it was not necessary for the Central Government to hear either party before passing that order. He points out that the minerals, for mining which the lease is granted under the Rules, are the property of the State. No person applying for a mining lease of such minerals has any right to the grant of the lease. According to him, the right will only arise after the lease has been granted by the State Government and the review application, if any, has been decided by the Central Government. He submits that even under r. 32, which deals with priority the State Government is not bound to grant the lease to the person who applies first and it can for any special reason and with the prior approval of the Central Government grant it to a person who applies later. His contention further is that as at the earlier stage when the grant is made by the State Government the order granting the lease is a mere administrative order as it must be in these circumstances (he asserts) , the order passed on review by the Central Government must also partake of the same nature. In order to decide between these rival contentions it is useful to refer to rules 52 to 55 which fall for consideration in this case. These are the rules as they existed up to 1953. Since then we are told there have been amendments and even the Act has been replaced by the . We are, however, not concerned with the Rules as modified after January 1954 or with the Act of 1957. Rule 52 inter alia provides that any person aggrieved by an order of the 780 State Government refusing to grant a mining lease may within two months of the date of such order apply to the Central Government for reviewing the same. Rule 53 prescribes a fee. Rule 54 may be quoted in extenso, " Upon receipt of such application, the Central Government may, if it thinks fit, call for the relevant records and other information from the State Government and after considering any explanation that may be offered by the State Government, cancel the order of the State Government or revise it in such manner as the Central Government may deem just and proper. " Rule 55 then says that the order of the Central Government under r. 54, and subject only to such order, any order of the State Government under these rules shall be final. This Court had occasion to consider the nature of the two kinds of acts, namely, judicial which includes quasi judicial and administrative, a number of times. In Province of Bombay vs Kushaldas section Advani (1), it adopted the celebrated definition of a quasi judicial body given by Atkin L. J. in R. vs Electricity Commissioners (2), which is as follows: " Whenever any body of persons having legal authority to determine questions affecting rights of subjects, and having the duty to act judicially act in excess of their legal authority they are subject to the controlling jurisdiction of the King 's Bench Division exercised in these writs. " This definition insists on three requisites each of which must be fulfilled in order that the act of the body may be a quasi judicial act, namely, that the body of persons (1) must have legal authority, (2) to determine questions affecting the rights of subjects, and (3) must have the duty to act judicially. After analysing the various cases, Das J. (as he then was) laid down the following principles as deducible therefrom in Kushaldas section Advani 's case (1)at p. 725 : " (i) That, if a statute empowers an authority, not being a Court in the ordinary sense, to decide (1) ; (2) 781 disputes arising out of a claim made by any party under the statute which claim is opposed by another party and to determine ' the respective rights of the contesting parties who are opposed to each other, there is a lis and prima facie and in the absence of anything in the statute to the contrary it is the duty of the authority to act judicially and the decision of the authority is a quasi judicial act; and (ii) that if a statutory authority has power to do any act which will prejudicially affect the subject, then, although there are not two parties apart from the authority and the contest is between the authority proposing to do the act and the subject opposing it, the final determination of the authority will yet be a quasi judicial act provided the authority is required by the statute to act judicially. " It is on these principles which are now well settled that we have to see whether the Central Government when acting under r. 54 is acting in a quasi judicial capacity or otherwise. It is not necessary for present purposes to decide whether State Government when it grants a lease is acting merely administratively. We shall assume that the order of the State Government granting a lease under the Rules is an administrative order. We have, however, to see what the position is after the State Government has granted a lease to one of the applicants before it and has refused the lease to others. Mr. Pathak contends that even in such a situation there is no right in favour of the person to whom the lease has been granted by the State Government till the Central Government has passed an order on a review application if any. Rule 55, however, makes clear that the order of the State Government is final subject to any order by the Central Government under r. 54. Now when a lease is granted by the State Government, it is quite possible that there may be no application for review by those whose applications have been refused. In such a case the order of the State Government would be final. It would not therefore be in our opinion right to say that no right of any kind is created in favour of a person to whom the lease is 782 granted by the State Government. The matter would be different if the order of the State Government were not to be effective until confirmation by the Central Government; for in that case no right would arise until the confirmation was received from the Central Government. But r. 54 does not provide for confirmation by the Central Government. It gives power to the Central Government to act only when there is an application for review before it under r. 54. That is why we have not accepted Mr. Pathak 's argument that in substance the State Government 's order becomes effective only after it is confirmed; r. 54 does not support this. We have not found any provision in the Rules or in the Act which gives any power to the Central Government to review suo motu the order of the State Government granting a lease. That some kind of right is created on the passing of an order granting a lease is clear from the facts of this case also. The order granting the lease was made in December 1952. In April 1953 the appellant was put in possession of the areas granted to him and actually worked them thereafter. At any rate, when the statutory rule grants a right to any party aggrieved to make a review application to the Central Government it certainly follows that the person in whose favour the order is made has also a right to represent his case before the authority to whom the review application is made. It is in the circumstances apparent that as soon as r. 52 gives a right to an aggrieved party to apply for review a lis is created between him and the party in whose favour the grant has been made. Unless therefore there is anything in the statute to the contrary it will be the duty of the authority to act judicially and its decision would be a quasi judicial act. The next question is whether there is anything in the Rules which negatives the duty to act judicially by the reviewing authority. Mr. Pathak urges that r. 54 gives full power to the Central Government to act as it may deem I just and proper ' and that it is not bound even to call for the relevant records and other information from,, the State Government before deciding an application for review. That is undoubtedly 783 so. But that in our opinion does not show that the statutory Rules negative the duty to act judicially. What the Rules require is that the Central Government should act justly and properly; and that is what an authority which is required to act judicially must do. The fact that the Central Government is not bound even to call for records again does not negative the duty cast upon it to act judicially, for even courts have the power to dismiss appeals without calling for records. Thus r. 54, lays down nothing to the contrary. We are therefore of opinion that there is prima facie a lis in this case as between the person to whom the lease has been granted and the person who is aggrieved by the refusal and therefore Prima facie it is the duty of the authority which has to review the matter to act judicially and there is nothing in r. 54 to the contrary. It must therefore be held that on the Rules and the Act, as they stood at the relevant time, the Central Government was acting in a quasi judicial capacity while deciding an application under r. 54. As such it was incumbent upon it before coming to a decision to give a reasonable opportunity to the appellant, who was the other party in the review application whose rights were being affected, to represent his case. In as much as this was not done, the appellant is entitled to ask us to issue a writ in the nature of certiorari quashing the order of January 28,1954, passed by the Central Government. We therefore allow the appeal and setting aside the order of the High Court quash the order of the Central Government passed on January 28, 1954. It will, however, be open to the Central Government to proceed to decide the review application afresh after giving a reasonable opportunity to the appellant to represent his case. The appellant will get his costs throughout from the third respondent, who is the principal contesting party. Appeal allowed.

Rule 54 of the Mineral Concession Rules, 1949, provided as follows: " Review. Upon receipt of such application, the Central Government may, if it thinks fit, call for the relevant records and other information from the Provincial Government, and after considering any explanation that may be offered by the Provincial Government, cancel the order of the Provincial Government or revise it in such manner as the Central Government may deem just and proper. The appellant was granted mining leases in respect of five areas and possession was delivered to him. On an application for review made by one of the respondents under r. 52 of the Rules, the Central Government, without giving the appellant an opportunity of being heard, cancelled the leases with regard to two of the areas and directed the State Government to grant leases in respect thereof to the said respondent. The appellant applied to the High Court under article 226 of the Constitution for quashing the said order. The Single judge who heard the application as well as the Division Bench on appeal held that the order of cancellation was an administrative order and the appellant was not entitled to a hearing. It was contended on behalf of the appellant in this Court that rr. 52 55 of the Rules showed that the proceeding before the Central Government was a quasijudicial proceeding and, consequently, the rules of natural justice must apply. Held, that the contention must prevail and the order of cancellation be quashed. In exercising its power of review under r. 54 of the Mineral Concessions Rules, 1949, the Central Government acted judicially and not administratively. Assuming that the act of the State Government in granting a mining lease was an administrative act, it was not correct to say that no right of any kind passed to the lessee thereunder untill the review was decided by the Central Government where a review had been applied for. Rule 52, therefore, by giving the aggrieved party the right to a review created a lis between him and the lessee and, consequently, in the absence of anything to the contrary either in r. 54 or the statute itself, there could be no 99 776 doubt that the Central Government was acting quasi judicially under r. 54. Province of Bombay vs Kushaldas section Advani. [1950] S.C.R.621, applied. R. vs Electricity Commissioner. (1924) I. K. B. 171, referred to.

minal Appeal No. 210 of 1963. Appeal by special leave from the judgment and order dated July 27, 1963, of the Madhya Pradesh High Court (Gwalior Bench) in Criminal Appeal No. 83 of 1963 and Criminal Reference No. 4 of 1963. K. K. Luthra, for the appellant. I. N. Shroff, for the respondent. January 24, 1964. RAGHUBAR DAYAL J. Faddi appeals, by special leave, against the order of the High Court of Madhya Pradesh confirming his conviction and sentence of death under section 302 I.P.C. by the Additional Sessions Judge, Morena. Jaibai, widow of Buddhu, began to live with Faddi a few years after the death of her husband Buddhu. Faddi and Jaibai at first lived at Agra, but later on shifted to 314 Morena. Jaibai had a son named Gulab, by Buddhu. Gulab was aged 11 years and lived in village Torkheda at the house of his phupa Ramle. He was living there from Sawan, 1961. Gulab 's corpse was recovered from a well of village Jarah on January 21, 1963. It reached the mortuary at Morena at 5 15 p.m. that day. It is noted on the postmortem report that it had been despatched from the place of occurrence at 1 p.m. Dr. Nigam, on examination, found an injury on the skull 'and has expressed the opinion that the boy died on account of that injury within two or three days of the postmortem examination. He stated in Court that no water was found inside either the lungs or the abdomen or the larynx or in the middle ear. This rules out the possibility of Gulab 's dying due to drowning. As a result of the investigation, the appellant and one Banwari were sent up for trial for the murder of Gulab. It is interesting to observe the course of the investigation. The police knew nothing of the offence till 9 p.m. on January 20, 1963, when the appellant himself went to the police station, Saroichhola, and lodged a first information report stating therein that on peeping into the well near the peepul tree of Hadpai on the morning of January 20, 1962, he found his son lying dead in the well. Earlier, he had narrated the events leading to his observing the corpse and that narration of facts accused Ramle, Bhanta and one cyclist of the offence of murdering the boy Gulab. It was this information which took the police to the well and to the recovery of the corpse. The police arrested the persons indicated to be the cul prits, viz., Ramle, Bhanta and the cyclist, who was found to be Shyama, by January 26. These persons remained in the lock up for 8 to 11 days. In the meantime, on January 26, the investigation was taken over, under the orders of the Superintendent of Police, by the Circle Inspector, Nazat Mohd. Khan from Rajender Singh, who was the Station Officer of Police Station, Saraichhola. The Circle Inspector arrested Faddi on January 27. He other arrested persons were got released in due course. Faddi took the Circle 3I5 Inspector to the house and, after taking out a pair of shorts of Gulab, delivered them to the Circle Inspector. Ramle, Bhanta alias Dhanta and Shyamlal have been examined as prosecution witnesses Nos. 15, 4 and 5 respectively. The conviction of the appellant is based on circumstantial evidence, 'there being no direct evidence about his actually murdering Gulab by throwing him into the well or by murdering him first and then throwing the dead body into the well. The circumstances which were accepted by the trial Court were these: 1. Faddi went to the house of Ramle at about noon on 19th January, 1962 and asked Ramle to send the boy with him. Gulab was at the time in the fields. After meals, Faddi left suddenly when Shyama arrived and gave a message to Ramle from Gulab 's mother that the boy be not sent with any one. Faddi caught hold of Gulab from the fields forcibly and took him away. It may be mentioned here that one Banwari who has been acquitted is also said to have been with Faddi at this time. Gulab had not been seen alive subsequent to Faddi 's taking him away on the afternoon of January, 19. His corpse was recovered on the forenoon of January, 21. Faddi had not been able to give any satisfactory explanation as to how he and Gulab parted company. Faddi knew the place where Gulab 's corpse lay. It was his information to the Police which led them to recover the corpse. His statement that he had noted the corpse floating on the morning of January 20 was untrue, as according to the opinion of Dr. Nigam, the corpse could come up and float in the water approximately after two days. The witnesses of the recovery deposed that they could not see the corpse floating and that it had to be recovered by the use of angles. 316 4. The accused 's confession to Jaibai and two other witnesses for the prosecution viz., Jimipal and Sampatti about his killing Gulab. The pair of shorts recovered was the one which Gulab was wearing at the time he was taken away by Faddi. The High Court did not rely on the confession and on the recovery of the pair of shorts from the appellant 's posses sion, and we think, rightly. The evidence about the confes sion is discrepant and unconvincing. Bhagwan0 Singh and Ramle deposed that the deceased was wearing the pair of shorts recovered, at the time the appellant took him away. Bhagwan Singh did not go to the test identification. The accused was not questioned about the deceased wearing these pair of shorts at the time he was taken away from the village. The High Court considered the other circumstances sufficient to establish that the appellant had committed the murder of Gulab. It therefore confirmed the conviction and sentence. Learned counsel for the appellant has taken us through the entire evidence and commented on it. He has contended that the evidence is unreliable and should not have been accepted by the Courts below. We have considered hi,,, criticism and are of opinion that the Courts below have correctly appreciated the evidence. It is not necessary for us to discuss it over again. It may be mentioned now that the. appellant denies having gone to Ramle 's house in village Torkheda and to have taken away Gulab from that village forcibly on the afternoon of January 19, but admits his lodging the report, and the recovery of the dead body from the well with the help of the angle. He however states that he had lodged the report on the tutoring of one Lalla Ram of Utampur. Ile hag neither stated why he was so tutored nor led any evidence in support of his allegation. In his report the appellant admitted the prosecution allegations up to the stage of 317 his forcibly taking away Gulab from village Torkheda. He then stated that Ramle, Bhatta and the third person, viz., Shyamlal threatened him with life, took out the pyjama and half pant from the body of Gulab and taking the boy with them remained sitting on the well near the peepul tree of Hadpai. The appellant kept himself concealed from their view, nearby. He heard the sound of something being thrown into the well. Those three persons then ran away, but he himself remained sitting there throughout the night and then, on peeping into the well next morning, observed the corpse of his son in the well,, He then went to Morena, consulted one Jabar Singh Vakil, and one Chhotey Singh and was advised to lodge the report. He definitely accused Ramle, Bhatta and the cycle rider with killing his son Gulab by throwing him into the well. This report is not a confessional statement of the appel lant. He states nothing which would go to show that he was the murderer of the boy. It is the usual first information report an aggrieved person or someone on his behalf lodges against the alleged murderers. The learned Sessions Judge and the High Court considered the appellant 's statements in this report which went to explain his separation from Gulab on account of the conduct of Ramle and others and came to the conclusion that those statements were false. This was in a way justified as the burden lay on the appellant to account for the disappearance of Gulab when the prosecution evidence showed that the appellant had taken Gulab with him. Besides, what the appellant had stated in the report, he had given no explanation for the disappearance. Of course, he had denied that he took Gulab with him. The evidence about that aspect of the case consists of the statement of Ramle, Shyamlal and Bhagwan Singh which have been accepted by the Courts below. The High Court also took into consideration the fact that the appellant knew where the deceased 's body was as it was on what he had stated in the report that the police went to the well of village Jarah and recovered the dead body. The accused gave no explanation in Court as to how he came to know about it. What he had stated in the report had been considered and found to be untrue and 318 specially in view of the appellant 's own conduct. It has been rightly stressed that if Gulab had been forcibly taken away from him by Ramle and others, the appellant ordinarily would have gone and taken some action about it, without wasting his time in just following those people. Even if he felt interested in following them and had heard the sound of something being thrown inside the well and had also seen those persons running away, he had no reason to remain hidden at that spot the whole night. He should have informed people of what he had observed as he must have suspected that these persons had played mischief with Gulab. The High Court also took into consideration the in correctness of the appellant 's statement that he observed the dead body floating in the well on the morning of January 20. It is contended for the appellant that the first information report was inadmissible in evidence and should not have been therefore taken on the record. In support, reliance is placed on the case reported as Nisar Ali vs State of U.P. (1). We have considered this contention and do not see any force in it. The report is not a confession of the appellant. It is not a statement made to a police officer during the course of investigation. Section 25 of the Evidence Act and section 162 of the Code of Criminal Procedure do not bar its admissibility. The report is an admission by the accused of certain facts which have a bearing on the question to be determined by the Court, viz., how and by whom the murder of Gulab was committed, or whether the appellant 's statement in Court denying the correctness of certain statements of the prosecution witnesses is correct or not. Admissions are admissible in evidence under section 21 of the Act. Section 17 defines an admission to be a statement, oral or documentary, which suggests any inference as to any fact in issue or relevant fact, and which is made by any of the persons, and under the circumstances, thereafter mentioned, in the Act. Section 21 provides that admissions are relevant and may be proved as against a person who makes them. Illustrations (1)[1957] S.C.R. 657. 319 (c), (d) and (e) to section 21 are of the circumstances in which an accused could prove his own admissions which go in his favour in view of the exceptions mentioned in section 21 to the provision that admissions could not be proved by the person who makes them. It is therefore clear that admissions of an accused can be proved against him. The Privy Council in very similar circumstances, held long ago in Dal Singh vs King Emperor(1) such first information reports to be admissible in evidence. It was said in that case at p. 142: "It is important to compare the story told by Dal Singh when making his statement at the trial with what he said in the report he made to the police in the document which he signed, a document which is sufficiently authenticated. The report is clearly admissible. It was in no sense a confession. As appears from its terms, it was rather in the nature of an information or charge laid against Mohan and Jhunni in respect of the assault alleged to have been made on Dal Singh on his way from Hardua to Jubbulpore. As such the statement is proper evidence against him. . It will be observed that this statement is at several points at complete variance with what Dal Singh afterwards stated in Court. The Sessions Judge regarded the document as discrediting his defence. He had to decide between the story for the prosecution and that told for Dal Singh. " Learned counsel for the appellant submits that the facts of that case were distinguishable in some respects from the facts of this case. Such a distinction, if any, has no bearing on the question of the admissibility of the report. The report was held admissible because it was not a confession and it was helpful in determining the matter before the Court. (1) L. R. 44 1. A. 137. 320 In Nisar Ali 's case(1) Kapur J. who spoke for the Court said, after narrating the facts: "An objection has been taken to the admissibility of this report as it was made by a person who was a co accused. A first information report is not a substantive piece of evidence and can only be used to corroborate the statement of the maker under section 157, Evidence Act, or to contradict it under section 145 of that Act. It cannot be used as evidence against the maker at the trial if he himself becomes an accused, nor to corroborate or contradict other witnesses. In this case, therefore, it is not evidence. " It is on these observations that it has been contended for the appellant that his report was inadmissible in evidence. Ostensibly, the expression 'it cannot be used as evidence the maker at the trial if he himself becomes accused supports the appellant 's contention. But it appears to us that in the context in which the observation is made and in the circumstances, which we have verified from the record of that case, that the Sessions Judge had definitely held the first information report lodged by the co accused who was acquitted to be inadmissible against Nisar Ali, and that the High Court did not refer to it at all in its. judgment, this observation really refers to a first information report which is in the nature of a confession by the maker thereof. of course, a confessional first information report cannot be used against the maker when he be an accused and necessarily cannot be used against a co accused. Further, the last sentence of the above quoted observation is significant and indicates what the Court meant was that the first in formation report lodged by Qudratullah, the co accused, was not evidence against Nisar Ali. This Court did not meanas it had not to determine in that case that a first informa tion report which is not a confession cannot be used as an admission under section 21 of the Evidence Act or as a relevant statement under any other provision of that Act. We find also that this observation has been understood in this way by the Rajasthan High Court in State vs Balchand(2) and (1) [1957]S.C.R.657. (2) A.I.R. 1960 Raj 101 321 in State of Rajasthan vs Shiv Singh(1) and by the Allahabad High Court in Allahdia vs State(2). We therefore hold that the objection to the admissibility of the first information report lodged by the appellant is not sound and that the Courts below have rightly admitted it in evidence and have made proper use of it. The circumstances held established by the High Court are sufficient, in our opinion, to reach the conclusion that Gulab was murdered by the appellant who was the last person in whose company the deceased was seen alive and who knew where the dead body lay and who gave untrue explanation about his knowing it in the report lodged by him and gave no explanation in Court as to how he separated from the deceased. We therefore dismiss the appeal. Appeal dismissed.

On the first information report lodged by the appellant, the corpse of his step son was recovered. The police arrested three other persons indicated to be the culprits, but as a result of the investigation, the appellant (1) A.I.R. 1961 Orissa, 131. 313 was sent up for trial for the murder and sentenced to death. The High Court confirmed the conviction and sentence. On appeal by special leave it was contended that the first information report was inadmissible in evidence and should not have been, therefore, taken on the record. Held:There was no force in the contention. The report was neither confession of the accused nor a statement made to a police officer during the course of investigation. Section 25 of the Evidence Act and section 162 of the Code of Criminal Procedure do not bar its admissibility. The report was an admission by the accused of certain facts which had a bearing on the question to be determined by the Court viz., how and by whom the murder was committed or whether the accused 's statement in court denying the correctness of certain statements of the prosecution witnesses was correct or not. Admissions ire admissible in evidence under section 21 of the Evidence admission of an accused can be proved against him. Dal singh vs King Emperor, L. R. 44 I.A. 137, applied. Nisar Ali vs State of U.P. , considered and distinguished. State vs Balachand A.I.R. 1960 Raj. 101, State of Rajasthan V. shiv Singh A.I.R. 1962 Raj. 3 and Allohdia vs State, 1959 All. L.J. 340, referred to.

ivil Appeal No. 2574 of 199 1. From the Judgment and Order dated 30.4.1991 of the Delhi High Court in C.W.P. No. 812 of 1991. Altar Ahmed, Additional Solicitor General, V.C. Mahajan, A.K. Srivastava, S.N. TerdaI and Vijay Kumar Verma for the Appellant. P.C. Jain, Ashim Vachher and Ms. Bharti Anand for the Respondent. The Judgment of the Court was delivered by 353 YOGESHWAR DAYAL, J. This appeal by Special Leave is directed against the judgment of the High Court of Delhi dated 30th April, 199 1 on behalf of the Union of India and the Chief of the Army Staff against Major General Dayanand Khurana. By the impugned judgment the Division Bench of the High Court directed the issue of writ of mandamus modifying an order dated 26th October, 1990 and thereby directing the appellants herein to treat Major General D.N. Khurana, who was approved for promotion to the acting rank of Lt. General for 'Staff Only ' Stream, senior to all the other Major Generals who were promoted to the acting rank of Lt. General in the 'Command and Staff ' Stream, and also issued further writ of mandamus directing the appellants to expeditiously promote the respondent herein, ahead of the 1957 batch, to a Staff post which has occurred between 26th October, 1990 and 31st May, 1991 keeping in view the existing policy of the Government and in the light of the observations made in the judgment. The brief facts which give rise to the filing of the writ petition in the High Court and the appeal before us may be noticed. The respondent was commissioned in the army in the year 1954, therefore, his original seniority reckons from the year 1954. As per the policy and procedure adopted in this connection every officer is given three chances for consid eration for promotion. If an officer is not approved for promotion during the first consideration, he loses one year of seniority and slides into the batch of the next year. In the eventuality of his not being approved for promotion even in the second consideration, he loses one more year of seniority and slides further into the next batch. Thereaf ter, the officer is considered for the last time for promo tion in the third chance and if he is not approved even in the third chance, he is not given any further consideration and is finally regarded as a superseded officer. In pursu ance of this policy, the respondent herein while he was acting as a Brigadier was first considered for promotion to the rank of Major General in the year 1983 but was not approved, and, therefore, he became part of 1955 batch instead of 1954 batch. Thereafter he was superseded again and ultimately got selected as a Major General in the 1956 batch. As per the existing policy at that time his seniority in the rank of Major General was re fixed alongwith the officers of 1956 batch as per the following sequence of selection: 354 1956 Batch: (a) Final review case of 1954 batch. (b) First review case of 1955 batch. (c) Fresh case of 1956 batch. The respondent while working as Major General was con sidered for promotion to the rank of Lt. General in July, 1989 but was rejected by the Government. He thus once again lost seniority of 1956 batch. He was then considered as a first review case in July, 1990 alongwith 1957 batch and was approved for selection for 'Staff Only ' Stream in the fol lowing sequence of consideration: "(a) Final review case of 1955 batch. (b) First review case of 1956 batch. (c) Fresh case of 1957 batch. Since the respondent was approved only for 'Staff Only ' Stream he was placed below all other Major Generals who were approved for selection in the Stream of 'Command and Staff. The respondent was aggrieved by his placement below the officers who were approved for 'Command and Staff ' Stream, though he had been approved only for 'Staff Only ' Stream. On 31st May, 1986 the Government of India approved, in principle, the 'Two Stream ' concept of career management of Army Officers of the ranks of Major General and Lt. General subject to the following stipulations: "(a) The modalities for implementation of 'Two Stream ' concept will be worked out by the Army Headquarters and submitted to Government for information. This will include identification of appointments to be manned by officers belonging to the 'Staff Only ' Stream. (b) The criteria and the QRs formulated by the Army HQrs and submitted to Government vide Army HQrs Note No. PC 01102/ MS 9B dated 7th February, 1986 will be applied for screening officers for promotion to the two streams. It will be ensured that 355 the QRs prescribed for promotion to the 'Command and Staff stream are stricter than those prescribed for the 'Staff Only ' stream. (c) A comprehensive review of the working of the concept will be done in 1987 and such amendments, as may be necessary, will be put up to Government for approval. This approval of the Government was preceded by the approval of the Prime Minister on 26th May, 1986. The reason for adoption of 'Two Stream Concept ' of career management for Army Officers is that the Army is highly command orient ed with the system itself providing a distinct edge for proven command performance. This orientation, especially in higher ranks, has helped to maintain the fighting efficiency of the Army and has stood to the test of time, besides being in the over all interests of the Service and the Nation. In order to be able to develop command potential, it was thought necessary that officers are allowed to hold command appointments for adequate periods. Thereafter the modalities for above 'Two Stream Concept ' were worked out by the Army Headquarters and an office order was issued by Military Secretary 's Branch, Army Headquar ters, dated 9th September, 1986. The relevant paragraphs are 1 to 3, 5 and 9 which read as under: "1. The upgradations in senior ranks in the Cadre Reviews have been sanctioned only in the Staff and ERE appointments. This has caused serious imbalances in the existing ratio between the Command, Staff and ERE appoint ments. Whereas, earlier senior officers could be given a proper command tenure before their turn came up for the next promotion, it is not now feasible in all cases after the upgrada tions are fully implemented. Ours is a Command oriented Army and successful performance in a command must continue to be mandatory for promotion to higher ranks. It is not desirable to truncate command tenures, if we have to maintain our fighting efficiency. It is to this and, that it has been decided to adopt the 'Two Stream Concept ' for officers of the rank of Brig. and above. The details of the concept are given in the succeeding paras. 356 Concept 3. The concept envisages that officers on promotion to Maj. General and Lt. General will be bifurcated into the 'Command and Staff ' and the 'Staff Only ' streams as per details given below: (a) 'Command and Staff Stream. Very high calibre officers based on their merit will be promoted to this Stream. They will hold com mand appointments in the Higher rank and thereafter be given exposure to Staff and ERE appointments as necessary. They will be eligi ble for further promotion as per the existing criteria. (b) 'Staff Only ' Stream. Officers promot ed to this Stream will hold only staff ap pointments, in the higher rank and will pro ceed on superannuation thereafter. These officers will not be eligible for further promotion. . . . . . Applicability 5. The 'Two Stream ' concept generally will be applicable to the officers of the General Cadre. However, non General Cadre officers will also be considered for the 'Staff Only ' Stream in the rank of Lt. General. 6 8 . . . . . Inter se Seniority 9. Officers selected for the 'Command and Staff Stream, will be promoted first, be it on a Command or Staff appointment. Thereafter, officer of the same batch who are selected for the 'Staff Only ' Stream will be promoted. Therefore, for the purpose of seniority, officers of the 'Staff Only ' Stream will be Junior to officers of the 'Command and Staff Stream. After placing the officers of the 'Staff Only ' Stream in suitable appointments, review selectees of the 'Command and Staff Stream of the next batch will be promoted. Again in adopting the methodology for implementation of the 357 'Two Stream Concept ' the following note dated 22nd Septem ber, 1986 was put up by the Military Secretary to the Chief of the Army Staff. This note pertains to the sequence of promotion in respect of officers who are approved for promotion under the Two Stream concept. The existing sequence of promo tion is laid down vide our policy letter No. 38360/MS 5 B dt. 29 May 84, placed opposite. With our command orientation, viable tenures in command assignment are mandatory to increase the fighting efficiency of the Army. It is, to this end that the Two Stream Concept has been adopted. With the introduction of the two stream concept in the ranks of Maj. Generals and Lt. Generals, the sequence of promotion into the streams needs to be formalised. In so doing, the main reasons for the introduction of the two stream concept, have to be the guiding principle. The two stream concept was intro duced to promote younger high calibre officers early, so that they get viable tenures in command. It is also well known that by and large an officer who is approved as a fresh case is of a higher calibre as compared to the ones approved for promotion as review cases. Thus it would be logical to promote the former category of officers approved in the 'Command and Staff stream, earlier than the latter category of officers approved in the 'Staff only ' stream. Two options are available for fixing the sequence of promotion under the 'Stream Concept '. These are given in subse quent paras with the help of the following illustrations (a) Batches considered at the Screening Board. (i) Final Review 1956 (ii) First Review 1957 358 (iii) Fresh Cases 1958. (b) Officers Approved for Promotion (i) Final Review 1956 (aa) Command and Staff Stream One (ab) Staff only Stream One (ii) First Review 1957 (aa) Command and Staff Stream One (ab) Staff Only Stream One (iii) Fresh Cases 1958 (aa) Command and Staff ten Stream (ab) Staff only stream five 7. Whatever sequence is followed, the IC number seniority within that stream of that batch needs to be maintained. The sequence of promotion could follow the undermentioned op tions: (a) Option A. To follow the existing sequence of promotion: (i) Final review Command and Staff stream 1956 batch. (ii) Final review Staff only stream 1956 batch. (iii) First review Command and Staff stream 1957 batch. (iv) First review Staff only stream 1957 batch. (v) Fresh Command and Staff stream 1958 batch. 359 (vi) Fresh Staff only stream 1958 batch. (b) Option B. The sequence of promotion to be: (i) Final review Command and Staff stream 1956 batch. (ii) First review Command and Staff stream 1957 batch. (iii) Fresh Command and Staff stream 1958 batch. (iv) Final review Staff only stream 1956 batch. (v) First review Staff only stream 1957 batch. (vi) Fresh Staff only stream 1958 batch. (The officers of 1959 batch, approved even in the Command and Staff stream, will be promoted after absorbing the Fresh 'Staff Only ' stream of 1958 batch.) 8. The advantages of Option A will be the disadvantages of Option B. The advantages and disadvantages of Option A are discussed below: (a) Advantages. (i) Those approved for promotion as review cases, will still get their promotion and also have a reasonably viable tenure. The chances of any proved ' officer retiring without get ting his promotion, are remote. (ii) The existence of dissatisfied officers among those approved for promotion, is unlike ly. (b) Disadvantages. (i) The basic principle behind the intro duction of the two stream concept gets defeat ed. (ii) Tenure of Command. Delay in the promo 360 tion of fresh cases of the Command and Staff stream, will give them lesser tenure, possibly affecting their chances of further promotion, thus having an overall detrimental effect. (iii) The principle of promoting really high calibre and the best officers early, is vio lated. Analysis. It would be noticed that the difference in the two options are minimal. In the case of Option A, the existing sequence of promotion has been maintained in that officers are being promoted as per their inter se seniority, irrespective of the stream. In the case of Option B, whereas the existing se quence of promotion is still being maintained, but promotion is being affected in accordance with the stream in which an officer is being promoted. Since officers of the 'Command and Staff are of higher calibre, promoting them over the 'Staff Only ' stream is logical and has been accepted in principle. Hence adoption of Option B, is recommended. For approval please. Once ap proved, Ministry of Defence will be informed accordingly. Sd/ (A.K. Chatterjee) Lt. Genl Sena Sachiv/ Military Secretary 22 Sep. 86 COAS through VCOAS The above note of the Military Secretary was considered by the Vice Chief of Army Staff and vide note dated 24th September, 1986 in which he has observed as under: "1. As I see it, in the ultimate, promotions in 'Command 361 and Staff ' stream and 'Staff stream should be independent of each other based on identified slots in each stream. The differential in terms of time between the two may be as much as two to three years, the exact period vary ing from time to time. It is only then that we would be able to have viable tenures for 'Command and Staff ' Stream officers, both in the rank of Maj. Gen. and Lt. Gen. Thus, our aim should be to promote a 'Command and Staff ' stream officer to Maj. Gen. at the age of 48 years or so and to Lt. Gen. at the age of 52 to 53 years. On the other hand, it would be acceptable if a staff stream officer is pro moted to Maj. Gen. at the age of 51 years or so and to Lt. Gen. at the, age of 54 or 55 years. In the light of the above, the propos al putforward by the MS cannot be a long term: proposal. However, we have perhaps no option but to adopt this for the short term, as the ages at which the officers are currently being approved for higher promotions are compara tively higher, and there would be imbalances if we increase the differential suddenly. MS proposal must, therefore, be seen as a valid one for the transitionary phase only. To that extent, I am in agreement with his recom mendation. Sd/ 24 Sep. 86 COAS The note of the Military Secretary alongwith the note of the Vice Chief of Army Staff was put up before the Chief of Army Staff, who, on 8th October, 1986 approved the note of the Vice Chief of Army Staff. The file was again put up to JDMS through the Military Secretary and the matter was discussed. Paragraph 7(a) of the note of the Military Secretary dated 22nd September, 1986 mentions Option 'A ' which was the existing sequence of promotion prior to September, 1986 and recommended in subparagraph (b) of paragraph 7 the sequence of promotion which was to be followed. In paragraph 8 the Military Secretary discussed the advantages and disadvan tages of Option 'A ' and Option 'B '. In paragraph 10 he recommended adoption of Option 'B '. He also mentioned in his note that if the note is approved, the Ministry of Defence will be informed accordingly. 362 It is clear that the Vice Chief of Army Staff adopted the proposal as recommended in the note of Military Secre tary in paragraph 10 which was again agreed to by the Chief of Army Staff. The matter was again sent to the Military Secretary who discussed it with the officers of Ministry of Defence. It is clear from Option 'B ', which was adopted for working out the 'Two Stream Concept ', that the seniority will first be given to the Command and Staff ' Stream selected from any of the earlier batches and after the 'Command and Staff ' stream has been accorded the seniority, the three streams of 'Staff Only ', mention at Sl. (iv), (v) and (vi) will be given seniority. It is also clear that the final review, the first review or fresh stream of 'Staff Only ' rank below the similar three streams of 'Command and Staff ' trained. The substance of this note is again conveyed by the Military Secretary in its communication dated 1st June, 1987 by way of further amplifying the methodology for implementa tion of the 'Two Stream Concept '. The letter reads: "COMMAND AND STAFF STREAM 1. Further to this Headquarters letter No. 00476/MS 9B dated 09 Sep 86. 2. Certain doubts have been expressed by officers regarding the 'Two Stream Concept '. This letter seeks to clarify the important issues with particular reference to: (a) Necessity of the Stream Concept. (b) Ages of superannuation. (c) Inter se seniority. Necessity 3. The upgradations which were sanctioned in the Second Cadre Review, were mainly on the Staff and ERE. This resulted in an imbalance in the Command and Staff ratio. Tenures in senior ranks in Command consequently became truncated which in a Command oriented Army like ours, is not acceptable. Hence the 'Two Stream ' Concept was intro 363 duced with the due approval of the Govern ment. Ages of Superannuation 4. As per the current rules officers of the 'Staff Only ' Stream are to superannuate one year earlier 'than the officers of the 'Com mand and Staff Stream. This rule is applicable both to the General Cadre and officers from other Arms and Services. However, in the case of officers of other Arms and Services certain other clarifications given in the succeeding paras will also be applicable. In the case of Maj Gens from other Arms and services, the screening is done primarily to permit the officers to be promot ed to un specified appointments outside their Corps on first promotion and if required ahead of officers not so selected. The ages of superannuation in their respect will remain unchanged and they shall superannuate at an age corresponding to the officers of the Command and Staff in the rank of Maj Gen. 6. Lt. Gens. Each other Arm/Service is autho rised two appointments specific to the Corps in the rank of Lt. Gen. Notwithstanding the proposal to downgrade the schools of Instruc tion, a second appointment in the rank of Lt. Gen. will invariably be made available to them to ensure that their promotional prospects do not lag behind. Officers holding these two assured appointments will superannuate at 58 years. Other officers from a particular Arm/Service in the 'Staff Only Stream ' over and above the two assured appointments will superannuate at 57 years as is applicable to officers of the General Cadre. However, if an appointment within the Corps falls vacant, such officer will be screened to assess his fitness for holding the specific vacancy within the Corps. If selected to hold the authorised vacancy, he will superannuate at an age corresponding to the age of Command and Staff Stream, i.e. 58 years. If in case, no vacancy is available, the officers of this Stream continue to superannuate at 57 years as mentioned earlier. Inter se seniority 7. The 'Two Stream Concept ' envisages that officers of the 364 General Cadre of a particular batch seniority approved in the 'Command and Staff ' Stream will be e.n block senior to those officers of the same batch approved on the 'Staff Only ' Stream. In so far as non General Cadre officers are concerned, the order of passing out is the determining factor to decide the inter se seniority amongst them subject to readjustment based on the sequence of selection. Doubts have also been raised regarding the inter se seniority between the officers of other Arms and Services approved on the 'Staff Only ' Stream vis a vis officers of the General Cadre approved in the 'Command and Staff ' Stream as well as 'Staff Only ' Stream. It is clarified, that as regards the seniority within the same batch is concerned, officers approved on the 'Command and Staff ' Stream continue to be senior to officers approved in the 'Staff Only ' Stream. However, an officer of an earlier batch approved on the 'Staff Only ' Stream will be senior to an officer of subsequent batch approved on the 'Command and Staff ' Stream. It will, therefore, be noticed from the above that while promoting officers in either the 'Command and Staff ' Stream or 'Staff Only ' Stream, concept of batch seniority as hither tofore applicable has in all cases been main tained. It is reiterated that the 'Stream Concept ' has been introduced to ensure that the best available talent and expertise available in the service is utilised. Content of this letter be widely dissemi nated. sd/ (Vijay Kumar) Lt. Gen Sena Sachiv/ Military Secretary" Before adverting to the submissions of the parties we may also refer to another letter dated 29th May, 1984 filed as Annexure P 2 to the writ petition in the High Court (page 306 of the paper book filed on 365 behalf of the respondents alongwith the counter affidavit). The letter dated 29th May, 1984 reads as under: "SEQUENCE OF SELECTION FOR SELEC TIVE RANKS 1. Reference MS Branch Liaison Letter No. 1/80 forwarded vide this Headquarters Letter No. OO170/MS9A dated 02 Aug 80. 2. Paras 26 and 27 of the above quoted Liaison Letter deal with the revised sequence of selection for promotion to the rank of A/Lt. Col. However, the example given in Para 26 has raised certain doubts in the minds of the officers. According to this example, the revised sequence of selection was to be in the following order: (a) Final Review (Say) 1960 Batch (b) First Review 1961 Batch (c) Fresh Selectees 1962 Batch 3. Prior to Feb., 1980 two different sequences of selection were being followed for promotion to the rank of A/Lt Col and A/Col, illustrated by the following examples: (a) for promotion to the rank of A/Lt Col (i) Fresh SeLEctees (Say) 1959 Batch (ii) Final Review 1957 Batch (iii) First Review 1958 Batch (b) for promotion to the rank of A/Col and above (i) Final Review 1954 Batch (ii) First Review 1955 Batch (iii) Fresh selectees 1956 Batch 366 4. In Feb 1980, it was decided to bring the sequence of selection in the rank of A/Lt Col in line with the sequence being followed for promotion to the ranks of A/CoI and above. The changed sequence of selection which is being presently followed is illustrated by the following examples: (a) Final Review 196 1 Batch (b) First Review 1962 Batch (c) Fresh selectees 1963 Batch 5. This new sequence was to be applied com mencing with the fresh selectees of 1963 as illustrated in para 4 above. Fresh selectees officers of 1962 and earlier seniority were to be treated by the old criterion as given in para 3(a) above. It was also decided that past cases would not be opened up for the revision of seniority. In view of above, para 26 of above men tioned Liaison Letter may please be treated as cancelled. This letter may please be given wide publicity. Sd/ (HB Kala) Col. Col MS 5 for Military Secretary" Learned counsels also brought to our notice paragraph 169 of Annexure P 3 filed in the writ petition (page 307 to 309 of the paper book) which reads as under: "169. A ' Batch for consideration for promotion to select rank is defined as "all officers who reckon seniority in a particular calender year". This has been done for the following reasons: (a) Officers are commissioned from IMA in Jan. and Dec. each year. 367 (b) Officers commissioned from OTS on grant of permanent commission lose seniority as per existing rules and they reckon seniority in Mar. and Sep. of each year. (c) Officers who forefeit service as a result of disciplinary awards reckon fresh seniority on any date in the calender year. (d) Officers passing promotion examinations late also reckon seniority corresponding to the date of the examination on which they finally passed. " It will be noticed that both these communications are before the 'Two Stream Concept ' which was accepted by the Government on 3 1st May, 1986 and its modalities being worked out thereafter. However, we will deal with these two communications little later. The Division Bench of the High Court considered the note of Military Secretary dated 22nd September, 1986, referred to above, as well as the note of the Vice Chief of Army Staff dated 24th September, 1986 as also the note of the Chief of Army Staff and took the view that if the sequence of promotion which was being followed was for Option 'A ' the writ petitioner would be entitled to be placed above the fresh Command and Staff ' Stream cases belonging to 1957 batch. The learned Judges further observed: "In our opinion it is the sequence which is referred to in the Option 'A ' which has to be followed for making promotion to the next higher rank of Lt. General. The reason for this is obvious. It is true that the Military Secretary had recommended in the note dated 22nd September, 1986 that Option 'B ' (supra) should be adopted. The Vice Chief of Army Staff, however, has stated that the proposal of the Military Secretary cannot be a long term proposal. He further recommended that the proposal of accepting Option 'B ' could be adopted for a short term only. "as the ages at which the officers are currently being approved for higher promo tions are comparatively higher". The Vice Chief of Army Staff then (emphasis added) recommended that Option 'B ' should be regarded as being 368 followed "for a transitionary phase only". It is clear from the aforesaid note of the VCOAS that option 'B ' was recommended for being approved only by way of temporary measure and with regard to those officers who were being considered for promotion at that time. The use of the expression 'Currently being approved ' must lead to only one conclu sion that it referred to those officers who were being considered for promotion on or about September, 1986. What is of greater importance is that the VCOAS was emphatic in observing that Option 'B ' could not be fa voured as a long term proposal. The Chief of Army Staff agreed with the recommendation of the Vice Chief of Army Staff. The effect of this must be that the recommendation of the Military Secretary to adopt Option 'B ' as a sequence of promotion was not accepted. The existing sequence of promotion which was being followed was recommended to be continued. " Again the Division Bench observed: "It is pertinent to note that notwithstanding the note dated 22nd September, 1986, and the subsequent opinion of the Vice Chief of Army Staff and the Chief of Army Staff, no letter of the type which was issued on 9th September, 1986, was ever issued by the Military Secre tary 's branch. Whereas the letter of 9th September, 1986, was issued to all the Command Headquarters, there is no format document which was issued or made known to the offi cers, purporting to give effect to Option 'B ' suggested by the Military Secretary vide his note dated 22nd September, 1986. On the con trary, the letter dated 1st June, 1987 issued by the Military Secretary 's Branch, referred to hereinabove, is clearly at variance with the suggestion of the Military Secretary contained in his note of 22nd September, 1986. If Option 'B ' had been accepted, then that would have been mentioned in the letter ' of 1st June, 1987. " Again in relation to the communication dated 1st June, 1987 the Division Bench observed as under: "Reverting to the letter of 1st June, 1987, we find that 369 towards the end of paragraph 9, it has been categorically stated that: "However, an officer of an earlier batch approved on the Staff Only Stream ' will be senior to an officer of subsequent batch approved on the 'Command and Staff ' stream". This is then emphasised by the contents of paragraph 10 of that very letter which reiter ates that: "The concept of batch seniority as hithertofore applicable has in all cases been maintained. " The anxiety of the Military Secretary 's branch apparently was that the batch seniority had to be maintained. If the argument of Mr. Vazey is accepted, the batch seniority cannot be main tained if the fresh cases of 1957 batch are to be promoted earlier than the petitioner, which is a first review case of 1956 batch, then the effect would be that officers belonging to the 1957 batch would be senior to the petitioner who belongs to the 1956 batch. Notwithstanding the note dated 22nd September, 1986 of the Military Secretary, the letter dated 1st June, 1987 of the Military Secretary 's branch makes it clear that the batch seniority shall always be maintained. Notwithstanding the fact that the fresh cases of 1957 batch have been ap proved for command and Staff stream, they would, nevertheless, come in sequence after the petitioner who belongs to the 1956 batch though selected in the Staff only Stream. It may happen that notwithstanding that the petitioner is placed at the head of the penal, no staff vacancy may occur and a vacancy may occur only for a command post to which the petitioner has not been selected but we are not concerned with such a case here. It is the admitted case before us that out of the penal of officers who were selected as per the letter dated 26th October, 1990, Major Gen. S.A. Singh and section Roy Choudhary have been, on promotion, posted to posts which are non Command posts. It appears to us that the Division Bench totally mis understood the note of the Military Secretary dated 22nd September, 1986 as well as the note of the Vice Chief of Army Staff dated 24th September, 1986. 370 It is in the select panel prepared dated 26th October, 1990 that the officers mentioned at (a) are the officers who were selected for 'Command and Staff ' stream whereas the respondent was selected for the stream of 'Staff Only. ' It is clear from the Scheme that the officers who were approved for 'Command and Staff ' stream can be appointed both for 'Command ' as well as 'Staff ' vacancies whereas the officers who were approved only for stream of 'Staff Only ' can only be appointed to the vacancies relating to 'Staff ' and cannot be appointed relating to vacancies for 'Command '. The ex pression 'same batch ' which is referred to in paragraph 9 of the letter dated 1st June, 1987 is for the officers who were considered for selection at one time and not the individual batch of the Major General. In the batch in which the re spondent was considered for promotion included (a) fresh cases of 1957, (b) first review case of 1956 and (c) final review cases of 1955. It is that batch which is being re ferred to as the 'same batch ' and it is specifically men tioned in paragraph 9 that for the purpose of seniority. officers of the 'Staff Only ' stream will be junior to the officers of the 'Command and Staff ' stream. It is again specifically mentioned that after placing the officers of the 'Staff Only ' stream, review selectees of the 'Command and Staff ' stream of the next batch to be promoted. This concept was further explained in the note of the Military Secretary dated 22nd September, 1986 which was approved by the Chief of Army Staff as well as duly informed to the Government as required by the communication dated 3 1st May, 1986, noticed by us earlier. In the note of the Military Secretary dated 22nd September, 1986 Option 'A ' which was prevalent practice was substituted by Option 'B ' which was recommended for future and which was accepted both by Vice Chief of Army Staff as well as the Chief of Army Staff. Option 'A ' was never put up as a proposal for acceptance or rejection to the Chief of Army Staff. Vice Chief of Army Staff only considered the proposal as recommended by Mili tary Secretary in his note dated 22nd September, 1986 and Vice Chief of Army Staff accepted it and the same was adopt ed by the Chief of Army Staff. This Option 'B ' has not been reviewed till date. There can be no doubt that if Option 'A ' was available for preparation of select list the respondent would have been senior to other persons who were recommended for 'Command and Staff ' stream. But Option 'A ' was given up and Option 'B ' was recommended for approval. If Option 'B ' has been adopted and accepted, as is clear, the seniority of the respondent placed in the panel dated 26th October, 1990 is unexceptionable. It is again clear that the recommenda tion of the Military Secretary dated 22nd September, 1986 approved by the Chief of Army Staff was fully stated in paragraphs 7, 9 and 10 of the communication dated 1st June, 1987. Merely because no reference 371 is made to the note of the Military Secretary dated 22nd September, 1986 in the communication dated 1st June, 1987 it does not mean that the note has to be ignored. It will be noticed from the communication dated 31st May, 1986 that after the Government had approved the concept of 'Two Stream ', it was left to the Army Headquarters to work out the modalities and merely inform the Government. In fact, the select panel, even after being prepared, has to be approved by the Government and has been so approved which show that the Government has accepted the modalities worked out by the Army Headquarters of the 'Two Stream '. It is clear from the noting of the Military Secretary which was accepted by the Chief of Army Staff that the same was inti mated to the Government and that the matter was also dis cussed with the Government by the Military Secretary. Noth ing further was required to be done and those decisions find place in paragraphs 7, 9 and 10 of the letter dated 1st June, 1987 by way of working out modalities. It is men tioned, even at the expense of repetition, in paragraph 7 of the aforesaid communication dated 1st June, 1987 that the 'Two Stream Concept ' envisages that the officers approved in the 'Command and Staff ' stream will be en block senior to the officers of the same batch approved in the 'Staff Only ' Stream. The same batch here refers to the three types of officers who were considered for promotion in the 1957 batch. Again in paragraph 9 it was 'repeated "it is clari fied, that as regards the seniority within the same batch is concerned, officers approved on the 'Command and Staff ' Stream continue to be senior to officers approved in the "Staff Only ' Stream. It was further clarified that "however, an officer of an earlier batch approved on the 'Staff Only ' Stream will be senior to an officer of subsequent batch approved on the 'Command and Staff ' Stream. Here the 'subse quent batch ' means the next batch of promotion. The expres sion 'same batch ' in the communications of 22nd September, 1986 and 1st June, 1987 took colour from the context and not from the definition of 'batch ' given in paragraph 169 no ticed earlier. Nor does the sequence of selection to be considered as was prevailing before the communication dated 22nd September, 1986 relevant. It was only the sequence of selection as proposed in Option 'B ' which was adopted. Again the observation of the Division Bench that the note of the Military Secretary dated 22nd September, 1986 is contrary to or at variance with the letter dated 1st June, 1987 is not correct. The letter of 1st June, 1987 is again for working out further modalities of 'Two Stream Concept ' vis a vis seniority in the light of the note of the Military Secretary dated 22nd September, 1986. 372 The Government has been very fair in placing before the results of the select panel prepared since the introduction of 'Two Stream Concept '. The first Special Selection Board, after September, 1986, for promotion to the rank of Lt. General was held in October, 1986. It was 1954 batch com prising or (a) Final Review of 1952, (b) First Review of 1953 and (c) Fresh 1954 and the officers who were selected to the Stream of 'Command and Staff ' were of 1954 batch and were placed en block senior to officers selected for 'Staff Only ' Stream who were again Fresh 1954. Again the same policy was followed in the case of the respondent. It was called 1957 batch comprising (a) Final Review of 1955, (b) First Review of 1956 and (c) Fresh 1957. Since the respond ent was approved only for 'Staff Only ' Stream, though he was first review case of 1956, he was placed below the officers who were approved for 'Command and Staff ' Stream and were Fresh 1957. Since there was no vacancy which could fall to the share of the respondent in his turn as per the seniority till he was superannuated on 3 1st May, 1991, the respondent could not take advantage of his approved promotion. The note dated 22nd September, 1986 amending the se quence of promotion and after giving advantage and disadvan tages of the two options i.e. Option 'A ' and Option 'B ' had, thereafter, recommended that Option 'B ' should be adopted. It may not be accurate for the High Court to apply Option 'A ' which has never been recommended and which was superseded by Option 'B ' which was accepted at the highest level. Fact remains that even the select panel prepared by the army authorities was approved by the Government before it was released. Learned counsel for the respondent referred to the case of Major General R.K. Gaur as mentioned in paragraph 49 of the writ petition. The averment in paragraph 49 of the writ petition is that Major General Gaur was a case of 1954 batch first review, and was approved on 26th August, 1988 for 'Staff Only ' Stream. Sometime in October, 1987 fresh cases of 1955 batch were also approved for promotion to the rank of Lt. General in which Major General V.K. Singh and Major General Hatvans Singh, in addition to many others, were approved for 'Command and Staff ' stream. By the time Major General Gaur was approved in its first review on 26th 2August, 1988 various officers of 1955 fresh cases were promoted except Major General V.K. Singh and Major General Harvans Singh. Between 26th August, 1988 on which date Major General Gaur was approved in 'Staff Only ' Stream 373 and 26th October, 1988 no promotions were made to the rank of Lt. General and on 26th October, 1988 Major General Gaur was ordered to be promoted and in his order it is mentioned that the general officer i.e. Major General Gaur will report for his new appointment forthwith. Since the order has come on 26th October, 1988 itself and the order was to report forthwith he could have picked up the rank the same day but incidentally he was out of station and returned only on 31st October, 1988 and he could pick up the rank only on 1st November, 1988. The orders of promotion of Major General V.K. Singh and Major General Hatvans Singh were issued on 27th October, 1988 which clearly indicate that the order of promotion of Major General Gaur was issued ahead of both the aforesaid officers. This would clearly indicate that in the case of Major General Gaur who was a 1954 batch first review case was promoted ahead of Major General V.K. Singh and Major General Harvans Singh who were approved in 'Command and Staff ' Stream as fresh cases of 1955 batch. The inten tion of issuance of such order promoting Major General Gaur on 26th October, 1988 clearly indicates that he was to be promoted ahead of those two officers. In reply to the submissions made in paragraph 49, it is pleaded on behalf of the Government that it was clearly mentioned that Major General Gaur, being a list review selectee of 1954 batch in 'Staff Only ' stream, reckoned seniority below the Fresh Selectee 'Command and Staff ' stream of 1955 batch. In the Army, the seniority is decided by the date of substantive promotion and not by the date, the officer picks. up his acting promotion. In many cases officers due to various administrative reasons, who are otherwise seniors, pick up their acting rank due to late assumption of higher officer later than their juniors. However, in such cases it is ensured that while granting substantive rank the panel seniority is maintained. It is a well known principle practised in almost all services and the writ petitioner is trying to confuse the issue with the letter relating to posting and promotion of senior officers which was issued one day later than his junior. It was contended that even in those promotion it was ensured that the seniors were at a liberty to assume their higher ap pointment in acting rank alongwith Major General Gaur. It was averred that it has been conveniently overlooked by the writ petitioner that promotion orders of several others of his senior were issued earlier. Moreover Lt. General Gaur was given substantive promotion at a date later than the other two officers mentioned by the writ petitioner. Under no circumstances a junior is promoted ahead of the senior. It was stated that Lt. General 374 Gaur was given substantive rank w.e.f. 1.11. 1988 whereas Lt. General Harvans Singh and Lt. General V.K. Singh, both seniors to Lt. General Gaur, were given substantive promo tion w.e.f. 27th October, 1988. We find that in view of this reply the petitioner cannot take advantage for being, promoted earlier than the officers selected for the 'Command and Staff ' Stream. We, thus, accept this appeal, set aside the order of the High Court dated 30th April, 1991 and dismiss the writ petition filed by the respondent. However, on the facts of the case, parties are left to bear their own costs through out. T.N.A. Appeal allowed.

On 31st May, 1986 the Government of India approved, in principle, the 'Two Stream ' concept of career management of Army Officers which envisaged that officers on promotion to Major General and Lt. General will be bifurcated into the 'Command and Staff ' and the 'Staff Only ' Stream. By an order dated 9th September, 1986 issued by Military Secretary, Army Headquarters, the modalities of the concept, were worked out and it was inter alia provided that for the purpose of seniority, officers of the 'Staff Only ' Stream will be junior to officers of the 'Command and Staff" Stream. While adopting the methodology for implementation of the 'Two Stream Concept ', in its note dated 22nd September, 1986 the Military Secretary stated that two options are available for fixing the sequence of promotion under the 'Stream Concept '. Under option 'A ' the existing sequence of promo tion is maintained and in that officers are to be promoted as per their inter se seniority, irrespective of the stream. In the case of Option 'B ', whereas the existing sequence of promotion is maintained, but promotion is to be effected in accordance with the stream in which an officer is being promoted. After giving advantages and disadvantages of the two options, the said note recommended that option 'B ' should be adopted. The Military Secretary 's note was ap proved by Vice Chief of Army Staff and the Chief of Army Staff. By a communication dated 1st June, 1987 the Military Secretary clarified its earlier note dated 22nd September, 1986 explaining that officers of the General Cadre of a particular batch seniority approved in the 'Command and staff ' Stream will be en block senior to those 351 officers of the same batch approved on the 'Staff Only ' Stream. However, an officer of an earlier batch approved on the 'Staff Only ' Stream will be senior to an officer of subsequent batch approved on the 'Command and Staff Stream. Under the promotion policy of Army every officer is given three chances for consideration for promotion. The first opportunity is called "fresh cases". The second oppor tunity is called "first review cases" and the third opportu nity is called "final review cases". An officer not approved for promotion loses one year on seniority and slides into the batch of the next year. The respondent, commissioned in the army in 1954, while acting as Brigadier, was selected as Major General in 1956 batch. Accordingly, his seniority was fixed alongwith 1956 batch. While working as Major General he was considered for promotion to the rank of Lt. General in 1989 but was disap proved. He thus lost seniority of 1956 batch. He was then considered as a first review case in 1990 alongwith 1957 batch comprising of final review case of 1955 batch, first review case of 1956 batch and fresh case of 1957 batch and was approved for selection for 'Staff Only ' Stream. Since he was approved only for 'Staff Only ' Stream, in the select panel dated 26th October, 1990 he was placed below all other Major Generals who were approved for selection in the Stream of 'Command and Staff. Aggrieved by his placement below the officers who were approved for 'Command and Staff ' Stream, he filed a writ petition in the High Court which directed the Union of India to treat the respondent senior to all the other Major Gener als who were promoted to the acting rank of Lt. General in the 'Command and Staff ' stream and to expeditiously promote him ahead of the 1957 batch. Against the decision of the Division Bench of the High Court the Union of India filed an appeal in this Court. Setting aside the order of the High Court, this Court, HELD: 1. The Division Bench of the High Court totally misunderstood the note of the Military Secretary dated 22nd September, 1986 as well as the note of the Vice Chief of Army Staff. In the note of the Military Secretary dated 22nd September, 1986, Option 'A ' which was prevalent practice was substituted by option 'B ' which was recommended for future and which was accepted both by Vice Chief of Army Staff as well as Chief of Army Staff. [369H 370E] 352 2. It is clear from option 'B ' which was adopted for working out the 'Two Stream Concept ' that the seniority will first be given to the 'Command and Staff ' stream selected from any of the earlier batches and after the 'Command and Staff ' stream has been accorded the seniority, the three streams of 'Staff Only ' will be given seniority and that the final review, the first review or fresh stream of 'Staff Only ' rank below the similar three streams of 'Command and Staff '. [362B C] 3. It is also clear from the Scheme that the Officer who Were approved for 'Command and Staff ' Stream can be appoint ed both for 'Command ' as well as 'Staff ' vacancies whereas the officers who were approved only for stream of 'Staff Only ' can only be appointed to the vacancies relating to 'Staff ' and cannot be appointed relating to vacancies for 'Command '. The expression 'same batch ' referred to in para graph 9 of the Military Secretary 's letter dated 1st June, 1987 is for the officers who were considered for selection at one time and not the individual batch of the Major Gener al. [370B] 4. Option 'B ' has not been reviewed till date. There can be no doubt that if option 'A ' was available for preparation of select list the respondent would have been senior to other persons who were recommended for 'Command and Staff ' Stream. But option 'A ' was given up and option 'B ' was recommended for approval. Since option 'B ' has been adopted and accepted the seniority of the respondent placed in the panel dated 26th October, 1990 is unexceptionable. [370F G] 5. The respondent cannot take advantage for being pro moted earlier than the officers selected for the 'Command and Staff ' Stream. [374B1

iminal Appeal No. 41 of 1967. Appeal by special leave from the judgment and order dated November 21, 1966 of the Delhi High Court in Criminal Revision Application No. 273 D of 1965. A. K. Sen, Veda Vyasa, K. B. Mehta, and H. L. Anand, for the appellant. H. R. Khanna and R. N. Sachthey, for the respondent. 394 395 The Judgment of the Court was delivered by Vaidialingam, J. The sole point, which arises for considera tion, in this appeal, by special leave, directed against the order of the High Court of Delhi, dated November 21, 1966, is about the validity of the complaint filed by the Deputy Chief Controller of Imports and Exports, New Delhi, the respondent herein, under section 5 read with section 6 of the Imports & Exports (Control) Act, 1947 (Act XVIII of 1947) (hereinafter referred to as the Act). Section 6 of the Act, relating to cognizance of offences, is as follows: "6. No Court shall take cognizance of any offence punishable under section 5 except upon complaint in writing made by an officer authorized in this behalf by the Central Government by general or special order, and no Court inferior to that of a Presidency Magistrate or a Magistrate of the first class shall try any such offence.". The respondent filed a complaint, on December, 31, 1962, be fore the First Class Magistrate. Delhi. alleging that the appellants, before us, and four others, had committed offences punishable under section 120B, read with section 420, I.P.C., and section 5 of the Act. The complaint, fairly elaborately, sets out the various matters containing allegations of violations of the conditions of the import licences granted to the appellants. It may also be stated at this stage, that the Chief Commissioner, Delhi, by his order, dated December 12, 1962, had given his consent to the initiation of proceedings, in the prosecution of the appellant and four others, mentioned therein, under sub section (2) of section 196A, 'of the Code of Criminal Procedure (hereinafter called the Code), inasmuch as the complaint also involved an offence of criminal conspiracy, under section 120B, P.C., to commit a non cognizable offence. So far as this consent is concerned, it is not the subject of any attack, before us. The complainant was examined as P.W. 3. He has stated, in his chief examination, that he filed the complaint, in question, after satisfying himself about the prima facie commission of the offences, mentioned in the complaint. In cross examination he has referred to the fact that he came to know about the case when he received a report from the Special Police Establishment, at the end of September 1962. When a question was put, as to whether he complainant would produce the said report, objection was raised, by the Public Prosecutor, that the said report was only the opinion of a police officer, and was not admissible, in law. This objection has been upheld by the Magistrate. The complainant has further stated that he visited the Special Police Establishment Office, for the first time, in connection with the case, only in September or October 1963, whereas the complaint had been filed, on December 31, 1962. He has also stated that he has not seen any of the documents, referred to in the police report, between the date when he received the report, and the date when the com plaint was filed. He has further stated that, on receipt of summons 396 from the Court, he visited the Special Police Establishment Office to see the documents, for satisfying himself that the complaint which he had filed, was based on absolute facts. His further answers were to the effect that when he filed the complaint he had not verified personally all the details mentioned in the police report, and that the Chief Commissioner 's permission, to initiate proceedings, had already been obtained, when he signed the complaint, on December 29, 1962. But, he has also stated that he had asked the Special Police Establishment, to draft the com plaint. The appellant tiled an application, on September 26, 1964, before the Trial Magistrate, stating that, in view of the above answers given, by the complainant, no cognizance should be taken, on the basis of the complaint filed by the respondent, Shri Bhargava, the Deputy Chief Controller of Imports and Exports. According to the appellant, section 6 of the Act is mandatory in character and enjoins that the entire facts and materials, connected with the allegations, which form the subject of the charge or charges, must be placed before the competent authority, and the complaint is to be initiated by the appropriate authority, only after due consideration of the entire materials. In this case, according to the appellant, the answers given by the Officer, as P.W.3, coupled with the non production of the Special Police Establishment 's report, will clearly show that the facts constituting the offence were not placed before him; and it is also clear that the complainant has not filed the complaint, after verifying and satisfying himself about the facts mentioned in the police report. As to what is contained in the police report, is a matter of pure conjecture, inasmuch as it has not been produced, before the Court. The Magistrate rejected this application, and his order was also confirmed, in revision, by the Additional Sessions , Judge, Delhi. Aggrieved by these orders of the Subordinate Courts, the appellant moved the Delhi High Court, for redress. The learned Judge, of the Delhi High Court, in his order, under appeal, has confirmed the orders of the Subordinate Courts. Mr. A.K. Sen, learned counsel for the appellants, has raised the same contentions. which did not find favour with the High Court. According to the learned counsel, section 6 of the Act is mandatory and, before a Court can take cognizance of an offence; punishable under section 5, the prosecution will have to establish that the facts constituting the offence, were placed before the complainant and that, after a proper consideration of those facts, the complaint has been instituted in this case, by P.W.3. Counsel also pointed out that the prosecution could have, very well, placed. before the Court the report of the Special Police Establishment to show that the necessary facts, which formed the basis of the complaint, were placed before the complainant; but, in this case, the prosecution had declined to produce the report, as will be 397 seen from the objections raised by it. Therefore, under those circumstances, an inference will have to be drawn against the prosecution, and the normal presumption should be that the evidence which could be, but had not been, produced would, if produced; be unfavourable to the person who withholds it, which, in this case, is the prosecution. Counsel also pointed out that, in this case, the High Court has proceeded on the basis that the filing of a complaint, by P.W. 3, is merely a mechanical act, which view is not justified, in law. In fact, we understood Mr. Sen to contend that there is no distinction, in principle, between provisions in statutes providing for the taking of cognizance of offences,, only on the previous sanction of any particular authority, and provisions providing, simpliciter, for a complaint being filed, by a particular person or officer. Mr. H. R. Khanna, learned counsel for the respondent com plainant, has pointed out that the principles, enunciated by the appellants ' counsel, do not apply to cases where the statute, as in this case, simpliciter provides for a complaint being made, by the particular officer, mentioned therein. In such cases, counsel points out, the Court has only to see whether the person or authority, mentioned therein, has initiated the proceedings, by filing a com plaint, in the manner, referred to in the particular provision. In this case, counsel points out, there is no controversy that the respondent is an officer, authorized by the Central Government, to file complaints, under section 5 of the Act. in this connection, counsel referred us to the provisions, contained in the Code of Criminal Procedure, some of which provide for cognizance being taken, of offences, only on a complaint made by a person or officer, mentioned therein, and in other cases, where taking cognizance of offences is prohibited, except on a sanction given by an authority, e.g., sections 195, 197, 198, etc. Having due regard to the provisions contained in section 6 of the Act, counsel pointed out, there is no infirmity in the complaint, filed by the respondent. The principle, that the burden of proving that a requisit sanction has been obtained, rests on the prosecution, and that such burden involves proof that the sanctioning authority had given the sanction in reference to the facts on which the proposed prosecution was to be based, facts which might appear on the fact of the sanction, or might be proved by extraneous evidence. is now well settled, by the decision of the Judicial Committee of the Privy Council, in Gokulchand Dwarkadas Morarka vs The King(1). There, their Lordships were considering cl. 23 of the Cotton Cloth and Yarn (Control) Order, 1943, as amended, to the effect: "No prosecution for the contravention of any of the provisions of this Order shall be instituted without the, previous sanction of the Provincial Government (or of such (1) L.R. 75 I.A. 30. SCI 12 398 officer of the Provincial Government not below the rank of District Magistrate as the Provincial Government may by general or special order in writing authorize in this behalf). " The Judicial Committee has held that in order to hold that there is a compliance with the provisions of cl. 23, it must be proved that the sanction was given, in respect of the facts constituting the offences charged, because the sanction to prosecute is an important matter, as it constitutes a condition precedent to the institution of the prosecution, and the Government have an absolute discretion to grant or withhold that sanction. The Judicial Committee has also emphasized that the Government cannot also adequately discharge the obligation of deciding whether to give or withhold the sanction, without a knowledge of the facts of the case, as sanction has to be given to a prosecution for the contravention of any of the provisions of the Order. These principles, laid down by the Judicial Committee, have also been approved, by decisions of this Court: See Madan Mohan vs State of Uttar Pradesh(1); Jawsant Singh vs State of Punjab(2); and Feroz Din vs The State of West Bengal(3). In Jaswant Singh 's Case(2), this Court, dealing with a case of sanction, under the Prevention of Corruption Act, 1947, after referring to the decision of the Judicial Committee, has observed that the sanction, under the said Act, is not intended to be, nor is an automatic formality, and it is essential that the provisions in regard to sanction should be observed with complete strictness, as the object of the provision for sanction is that the authority, giving the sanction, should be able to consider, for itself, the various facts alleged, before it comes to the conclusion that the prosecution, in the circumstances, be sanctioned or forbidden. We are not inclined to accept the contentions of Mr. Sen, that the principles laid down in these decisions, which relate to the question of sanction. have any application to the filing of complaints, under section 6 of the Act. Section 6 only insists that the complaint is to be in writing and that it must be made by an officer, authorised in that behalf. The complaint, in this case, has been made by the respondent in writing, and that he is an authorised officer, in this behalf, has not been challenged. The limitation, contained in section 6, is only regarding the particular officer who could file a complaint and, when once he satisfies those requirements, the bar is removed to the taking of cognizance by a Court, on a complaint, made in accordance with section 6. In this connection, it is desirable to bear in mind the observations of this Court, made in section A. Venkataraman vs The State(4). After considering the scheme of the Code, this Court observed: "In construing the provisions of a statute it is essential for a court, in the first instance, to give effect to the (1) A.I.R. 1954 S.C. 637, 641. (2) ; , 765. (3) ; , 330. (4) , 1041, 399 natural meaning of the words used therein, if those words are clear enough. It is only in the case of any ambiguity that a court is entitled to ascertain the intention of the legislature by construing the provisions of the statute as a whole and taking into consideration other matters and the circumstances which led to the enactment of the statute. " Going by the plain words, contained in section 6 of the Act, we are satisfied that the complaint, in this case, filed by the respondent, can be considered to be in conformity with the provisions, contained therein. But Mr. Sen relied upon the decision of this Court in Feroz Din 's Case(1) in support of his argument that cases in which sanction is necessary, to enable a Court to take cognizance of offences, and cases, in which a mere complaint, is to be filed by a public officer, without the requirement of any sanction, have been treated on a par, and the same tests, for finding out the legality of a complaint, in the former class of cases, have been applied to the latter class of cases also. It is therefore necessary to consider the exact scope of that decision. In that decision, this Court was considering a complaint, filed by a management, under sections 24 and 27, of the . The management company, in that case, filed a complaint, with the sanction of the Government. The provision, regarding sanction, is contained in section 34(1) of the , which is as follows: "No Court shall take cognizance 'of any offence punishable under this Act. . save on complaint made by or under the authority of the appropriate Government.", One of the contentions raised by the appellants, therein, based upon the decision of the Judicial Committee, in Morarka 's Case(2), was that the sanction, given by the Government of West Bengal, to file the complaint against them, was bad, as it had been granted without reference to the facts constituting the offence. This Court, after referring, to the said decision, rejected the contention of the appellants and held that the entire facts, connected with the offence, had been placed before the sanctioning authority, and the Government gave the sanction, on consideration of those facts, and that those circumstances fully satisfied the requirements of 'prior sanction ', as laid down by the Judicial Committee. It will be seen, by a reference to section 34(1) of the , extracted above, that a complaint can be filed by the appropriate Government itself, or it can be filed, under the authority of the appropriate Government. In the decision before this Court, the Government had not filed the complaint, but, an the other hand, the management company obtained the sanction of the Government of West Bengal, to file the complaint. That is why this Court (1) ; , 330. (2) L.R. 75 I.A. 30. 400 had occasion to consider the validity of the sanction regarding which an attack was made by the appellants. This Court, in that case nevertheless, apply, if the Government itself had filed the complaint, as it was entitled to, under section 34(1). Therefore, the observations made, in that case, regarding the validity of sanction , will have to be confined to the facts of that case. No such question arise, with regard to the matter before us. The section, with which we are concerned, does not contain any such restriction, regarding the obtaining of sanction, on the basis of which alone a complaint can be filed, to enable a Court to take cognizance of an offence. The result is, the view of the High Court, that the complaint, filed by the respondent, on December 31, 1962, satisfies the requirements of section 6 of the Act, is perfectly correct. The appeal therefore fails, and is dismissed. G.C. Appeal dismissed.

The Deputy Chief Controller of Imports & Exports New Delhi filed a complaint against the appellant under section 5 read with section 6 of the Imports & Exports (Control) Act, 1947 before the Magistrate First Class Delhi. In the witness box the complainant admitted that when he filed the complaint he had not seen any of the documents referred to in the report of the Special Police Establishment in connection with the case and had not verified personally all the detail* mentioned in the report. The appellant filed an application requesting the Magistrate not to take cognizance of the case as the complaint did not satisfy the requirements of section 6 of the Act. The plea was rejected by the Magistrate, the Sessions Judge and the High Court. An appeal to this Court was filed by special leave. It was contended on behalf of the appellant that as in the case of sanction for prosecution of certain offences, before a court can take cognizance of an offence punishable under section 5 on the basis of a complaint under section 6, the prosecution will have to establish that the facts constituting the offence, were placed before the complainant, and that the latter on a proper consideration of these facts has filed the complaint. Held: (i) The principles applicable to cases requiring sanc tion have no application to filing of complaints under section 6 of the Act. Section 6 only insists that the complaint is to be in writing and that it must be made by an officer authorised in that behalf. The limitation contained in s.6, is only regarding the particular officer who could file a complaint and, when once he satisfies those requirements, the bar is removed to the taking of cognizance by a court, on a complaint made in accordance with section 6. [398F G] In the present case the complaint had been made by an autho rised officer in writing. The requirements of section 6 were therefore satisfied and the Magistrate rightly took cognizance of the offence. [399B C] Gokulchand Dwarkadas Morarka vs The King, L.R. 75 I.A. 30; Madan Mohan vs State of Uttar Pradesh, A.I.R. 1954 S.C. 637, 641 and Jaswant Singh vs State of Punjab, ; , 765, referred to. S.A. Venkataraman vs The State, , 1041, applied. Feroz Din vs The State of West Bengal, ; , 330,distinguished.

Appeal No. 673 of 1963. Appeal from the judgment and decree dated September 22, 1960, of the Allahabad High Court in Income tax Mis cellaneous Case No. 188 of 1953. section K. Kapur and R. N. Sachthey, for the appellant. Veda Vyasa and Naunit Lal, for the respondent. April 30, 1964. The Judgment of the Court was delivered by SUBBA RAo, J. The question for decision in this appeal is whether when the Income tax Officer in his discretion assessed an association of persons to income tax, the Appel late Assistant Commissioner in appeal or the Income tax Appellate Tribunal in further appeal can set aside that order and direct him to assess the members of that association individually. 'Me facts lie in a small compass and they areas follows: 'Me assessee consisted of several persons combined together for the purpose of purchasing coal in order to supply the 87 same to customers for domestic purposes and other small scale industries. For the assessment year 1948 49 the Income tax Officer levied tax upon the total income in the hands of the said association of persons. The assessee claimed that in the circumstances of the case it should not be assessed to tax as an association of persons, but the proportion of the income in the hands of each of the members of the association might be assessed to tax instead. As the Income tax Officer did not comply with this request, the assessee preferred an appeal to the Appellate Assistant Com missioner, but it was dismissed. On a further appeal to the Income tax Appellate Tribunal, the Tribunal held that though the Income tax Officer had the power to assess the income of the association of persons as such or in the alternative on the individual members thereof in respect of their propor tionate share in the income,, it (the Tribunal) had no power under the Act to direct the Income tax Officer to exercise his rower in one way or other. The following question was referred to the High Court, of Allahabad under section 66(2) of the Indian Income tax Act, 1922: "If in pursuance of section 3 of the Indian Income tax Act the Income tax Officer levies the income tax in respect of the total income of the previous year of an association of persons upon the said association of persons as a collective unit, whether the Tribunal is competent to direct the Income tax Officer to levy the income tax proportionately upon the individual members of the said association of persons in respect of the proportionate income of each of the members consisting the said association of persons. " A Division Bench of the High Court held that the Appellate Tribunal had power to sat aside the Income tax Officer 's assessment against the association and to give consequential and ancillary directions to the said Officer to assess the Individuals. Learned counsel for the Revenue contends that under the Indian Income tax Act, 1922, he reinafter called the Act, the Income tax Officer has no option but to assess the total 88 income of the association of members, though the indivi dual 's share in the income may be added to his individual income for the purpose of ascertaining his total income. He further argues that even if the Income tax Officer has the option to assess to income tax the association of persons on its total income or the individual members thereof in respect of their proportionate share of the income, if he had exercised the option in one way or other neither the Appellate Assistant Commissioner in appeal nor the Income tax Appellate Tribunal in further appeal has power to direct the Incometax Officer to exercise his discretion in a different way; and for this conclusion he seeks to draw strength from his further submission that no appeal lies at the instance of the association of persons when they are assessed as one unit on the ground that the Officer should have assessed the individual members of the said association. At the outset it will be convenient to read the relevant provisions of the Act. Section 3. Charge of Income tax: Where any Central Act enacts that income tax shall be charged for any year at any rate or rates, tax at that rate or those rates shall be chareed for that year in accordance with, and subject to the provisions, of, this Act in respect of the total income of the previous year of every indi vidual, Hindu undivided family, company and local authority, and of every firm and other association of persons or the partners of the firm or the members of the association individually. Section 14. (2) The tax shall not be payable by an assessee (b) if a member of an association of persons other than a Hindu undivided family, a company of a firm, in respect of any portion of the amount which he is entitled to receive from the associa, tion on which the tax has already been paid by the association. 89 Section 30. (1) Any assessee objecting to the amount of income assessed under section 23 . . . . . or the amount of tax determined under section 23 under this Act may appeal to the Appellate Assistant Commissioner against the assessment or against such refusal or order: Section 31. (3) In disposing of an appeal the Appellate Assistant Commissioner may, in the case of an order of assessment, (a) confirm, reduce, enhance or annul the assessment, or (b) set aside the assessment and direct the Incometax Officer to make a fresh assessment after making such further inquiry as the Income tax Officer thinks fit or the Appellate Assistant Commissioner may direct, a ,id the Income tax Officer shall thereupon proceed to make such fresh assessment and determine where necessary the amount of tax payable on the basis of such fresh assessment. x x x x x x (4) Where as the result of an appeal any change is made in the assessment of a firm or association of persons or a new assessment of a firm or associations of persons is ordered to be made, the Appellate Assistant Commissioner may authorise the Income tax Officer to amend accordingly any assessment made on any partner of the firm or any member of the association. Section 3 imposes a tax upon a person in respect of his total income. The persons on whom such tax can be imposed ,are particularized therein, namely, Hindu undivided family, company, local authority, firm, association of persons, partners of firm or members of association individually. The section, therefore, does not in terms confer any power on any particular officer to assess one of the 90 persons described therein, but is only a charging section imposing the levy of tax on the total income of an assessable entity described therein. The section expressly treats an association of persons and the individual members of an association as two distinct and different assessable entities. On the terms of the section the tax can be levied on either of the said two entities according to the provisions of the Act. There is no scope for the argument that under section 3 the assessment shall be only on the association of persons as a unit though after such assessment the share of 'he income of a member of that association may be added to his other income under section 14(2) of the Act. This construction would make the last words of the section, viz., "members of the association individually" a surplusage. This argument is also contrary to the express provisions of section 3, which mark out the members of the association individually as a separate entity from the association of persons. Income of every person whether he is a member of an association or not is liable to the charge under the head " 'every individual". Section 14(2) (b) only says that if such an individual happens to be a member of an association of persons which has already been assessed, the tax would not be payable in respect of the share of his income again. That under the Act an assessment can be made on an association of persons as a unit or, alternatively, on the individual members thereof in respect of their respective shares of the income was assumed by this Court in Commissioner of Income tax vs Raja Reddy Mallaram(1). We, therefore, hold that section 3 impliedly gives an option to an appropriate authority to assess the total income of either the association of persons or the members of such association individually. The next question is whether the said option is given only to the Income tax Officer and is denied to the Appellate Assistant Commissioner and the Appellate Tribunal. Under the Act the Income tax Officer, after following the proce dure prescribed, makes the assessment under section 23 of the Act. Doubtless in making the assessment at the first instance he has to exercise the option whether he should assess the association of persons or the members thereof (1) [1964]51 I.T.R. 285 (S.C.) 91 individually. It is not because that any section of the Act confers an exclusive power on him to do so, but because it is part of the process of assessment; that is to say, he has to ascertain who is the person liable to be assessed for the tax. If he seeks to assess an association of persons as an assessable entity, the said entity can object to the assessment, inter alia, on the ground that in the circumstances of the case the assessment should be made on the members of the association individually. The Income tax Officer may reject its contention and may assess the total income of the association as such and impose the tax on it. Under section 30 an assessee objecting to the amount of income assessed under section 23 or the amount of tax determined under the said section or denying his liability to be assessed under the Act can prefer an appeal against the order of the Income tax Officer to the Appellate Assistant Commissioner. It is said that an order made by the Income tax Officer rejecting the plea of an association of persons that the members thereof shall be assessed individually does not fall under one or other of the three heads mentioned above. What is the substance of the objection of the assessee? The assessee denies his liability to be assessed under the Act in the circumstances of the case and pleads that the members of the association shall be assessed only individually. The expression "denial of liability" is comprehensive enough to take in not only the total denial of liability but also the liability to tax under particular circumstances. In either case the denial is a denial of liability to be assessed under the provisions of the Act. In one case the assessee says that he is not liable to be assessed to tax under the Act, and in the other case the assessee denies his liability to tax under the provisions of the Act if the option given to the appropriate officer under the provisions of the Act is judicially exercised. We, therefore, hold that such an assessee has a right of appeal under section 30 of the Act against the order of the Income tax Officer assessing the association of members instead of the members thereof individually. If an appeal lies, section 31 of the Act describes the powers of the Appellate Assistant Commissioner in such an appeal. Under section 31 (3) (a) in disprosing of such an appeal the Appellate Assistant Commissioner may, in the, case of an order of assessment, confirm, reduce, enhance or 92 annul the assessment; under cl. (b) thereof he may set aside the assessment and direct the Income tax Officer to make a fresh assessment. The Appellate Assistant Commissioner has, therefore, plenary powers in disposing of an appeal. The scope of his power is coterminous with that of the Income tax Officer. He can do what the Income tax Officer can do and also direct him to do what he has failed to do. If the Income tax Officer has the option to assess one or other of the entities in the alternative, the Appellate Assistant Commissioner can direct him to do what he should have done in the circumstances of a case. Under section 3 3 (I ), au assessee objecting to an order passed by an Appellate Assistant Commissioner under section 28 or section 31 may appeal to the Appellate Tribunal within 60 days of the date on which such order is communicated to him. Under section 33(4), "The Appellate Tribunal may, after giving both parties to the ,appeal an opportunity of being heard, pass such orders thereon as it thinks fit, and shall communicate any such orders to the assessee and to the Commissioner." Under section 33(5), "Where as the result of an appeal any change is made in the assessment of a firm or association of persons or a new assessment of a firm or association of persons is ordered to be made, the Appellate Tribunal may authorise the Income tax Officer to amend accordingly any assessment made on any partner of the firm or any member of the association". Under this section the Appellate Tribunal has ample power to set aside the assessment made on the association of persons and direct the Income tax Officer to assess the individuals or to direct the amendment of the assessment already made on the members. The comprehensive phraseology used both in section 31 and section 33 of the Act does not countenance the attempt of the Revenue to restrict the powers of the Appellate Assistant Commissioner or of the Appellate Tribunal; both of them have power to direct the appropriate authority to assess the members individually instead of the association of persons as a unit. We, therefore, hold, agreeing with the High Court, that the Appellate Tribunal has jurisdiction to give directions to the appropriate authority to cancel the assessment made or the association of persons and to give appropriate directions 93 to the authority concerned to make a fresh assessment on the members of that association individually. The answer given by the High Court to the question propounded is correct. In the result, the appeal fails and is dismissed with costs. Appeal dismissed.

Income tax was assessed upon the total income in the hands of the respondent assessee, an association of several persons combined together for the purpose of purchase of coal and its supply to customers for domestic purposes and other small scale industries. The assessee claimed that it should not be assessed to tax as an association of persons, but the proportion of the income in the hands of each members of the association might be assessed to tax instead. The Income tax Officer refused this request and an appeal to the Appellate Assistant Commissioner was dismissed. The Income tax Appellate Tribunal, on a further appeal. held that though the Income tax Officer had power to assess income of the association of persons as such or in the alternative on the individual members thereof in respect of their proportionate share in the income, the tribunal had no power under the Act to direct the Income tax Officer to exercise his power in one way or other. On a 86 reference, the High Court held that the Appellate Tribunal had power to set aside the Income tax Officer 's assessment against the association and to give consequential and ancillary 'directions to the said officer to assess individuals. HELD: (i) Section 3 of the Income tax Act impliedly gives an option to an appropriate authority to assess the total income of either the association of persons or the members of such association individually. Commissioner of Income tax vs Reddy Mallaram, followed. (ii) Such an assessee has a right to appeal under section 30 of the Act against the order of the Income tax Officer assessing the association of persons instead of the members individually. (iii) The Appellate Tribunal has jurisdiction to give directions to the appropriate authority to cancel the assessment made on the association of persons and to give appropriate directions to the authority concerned to make fresh assessment on the members of that associations individually. The phraseology used both in section 31 and section 33 does not restrict the powers of the Appellate Assistant Commissioner or the Appellate Tribunal; both have the power of such direction.

Appeal No. 934 of 1964. Appeal from the judgment and order dated January 13, 1964, of the Punjab High Court (Circuit Bench) at Delhi in Civil Writ No. 258 D of 1957. Hardayal Hardy, B. Dutta, M. section K. Sastri and J. B. Dadachanji, for the appellants. C. K. Daphtary, Attorney General R. K. P. Shankardass and R. H. Dhebar, for the respondents. The Judgment of the Court was delivered by Gajendragadkar, C.J. The two appellants, the Hamdard Dawakhana (Wakf), Delhi, and its Mutawalli Haji Hakim Hameed, represent the Hamdard Dawakhana institution which was initially established in or about 1906 as a dawakhana and was subsequently declared and founded as a Wakf. Since its inception, the institution has been running dispensaries and clinics for the treatment of patients and has been manufacturing and supplying medicines and medicinal products according to Ayurvedic and Unani Systems of medicines. Appellant No. 1 also manufactures medicated syrups which contain some fruit juices for medicinal use and they are prepared according to a certain formula devised by it. "Sharbat Rooh Afza" which is a medicated syrup manufactured by appellant No. 1 is made of the following ingredients "Kasni seeds, Khus, Pumpkin Juice, Water melon Juice, Chharila, Ripe grapes, Spinach, Nilofar, Sandal, 194 Gul Gaozaban, Coriandar, Carrot, Mint, Kulfa, Keora, Rose, Citrus flower, Orange Juice, Pine apple Juice, Water, Sugar". The formula determining the ratio and proportion in which each one of the ingredients has to be used, has been evolved by appellant No. 1 as a result of various experiments spread over a long period. The manufacture of this Sharbat began in 1920. It is intended to be used for common ailments during hot season, particularly for ailments like loss of appetite, sun stroke, nausea, sleeplessness, etc. This Sharbat Rooh Afza is not a foodstuff, and cannot be regarded as an essential commodity under section 2 of the (No. 10 of 1955) (hereinafter called 'the Act '). In substance, this is the case as set out by the appellants in their petition. Purporting to act under section 3 of the Act the Central Govern ment made an Order called the Fruit Products Order, 1955 (hereinafter called 'the Fruit Order ') under Notification No. S.R.O. 1052 dated May 3, 1955. Under clause 3 of the Order, respondent No. 4, the Central Fruit Products Advisory Committee, has been constituted. It appears that on the 22nd September, 1956, the Central Government purporting to act under section 3 of the Act, made certain amendments in the Fruit Order. The result of one of the amendments thus made was to direct that the minimum percentage of fruit juice in the final product of a fruit syrup as indicated in Part 11 of the Second Schedule to the Fruit Order should be raised from 10% to 25%. The change so made was notified to the appellants by respondent No. 2, the Marketing Development Officer, Fruit Products, Central Zone, Delhi, on January 29, 1957. As a result of this intimation, certain correspondence followed between the appellants and respondent No. 2. The appellants had urged in the course of this correspondence that Sharbat Rooh Afza did not fall within the scope of the Act and the Fruit Order. On March 25, 1957, respondent No. 3, the Agricultural Marketing Adviser to the Government of India, New Delhi, invited a representative of the appellants for discussions, and as a result of the said discussion, Mr. Sood, the Marketing Development Officer, Delhi, inspected the factory of the appellants and watched the process of manufacture of Sharbat Rooh Afza on April 29, 1957. Thereafter, on May 10, 1957, the appellants received a communication from Mr. Sood ordering the appellants to stop further manufacture and sale of Sharbat Rooh Afza forthwith on 195 the ground that it did not contain the minimum percentage of fruit juice prescribed by the relevant clause of the Fruit Order. This communication mentioned the fact that the appellants had been specifically asked to prepare fruit syrups strictly in accordance with the specifications prescribed, but in utter disregard of the said instructions, the appellants had wilfully continued to contravene the provisions of the Fruit Order. That is why by virtue of the powers conferred on him by clause 13(f) of the Fruit Order, the present order was served on the appellants. It is this order which was challenged by the appellants by their writ petition filed before the Punjab High Court on the 18th May, 1957 (No. 258 D of 1957). By their writ petition, the appellants prayed that the impugned order as well as the several orders passed preceding it, should be quashed and a writ of mandamus should be issued against the respondents restraining them from seeking to enforce the material provisions of the Fruit Order in respect of the appellants ' product 'Sharbat Rooh Afza '. The appellants urged that the said Sharbat is not a foodstuff, but a medicinal product and as such, its produc tion cannot be regulated under the provisions of section 3 of the Act. According to them, the said Sharbat was not an essential commodity, nor was it a 'fruit product ' as defined by clause 2(d) of the fruit Order. They also urged that the impugned order was invalid, because it contravened the fundamental rights of the appellants under article 19(1)(f)&(g) of the Constitution; the Sharbat in question was in fact a medicinal product and as such, the impugned order was inconsistent with clause 16 (1) (c) of the Fruit Order. It is on these grounds that the appellants sought relief by way of an appropriate writ or order quashing the impugned order issued against them on May 10, 1957. To this petition, the appellants impleaded the Union of India as respondent No. 1. This petition was resisted by the respondents on several grounds. It was alleged that the Sharbat in question fell within the scope of the Act and the Fruit Order. The respondents referred to the fact that the Hamdard Dawakhana had duly applied and was granted a licence in 1955 as a manufacturer engaged in the business of manufacturing fruit products for sale. The Dawakhana is holding this licence since 1955. The bottles in which the Sharbat in question is sold by the appellants do not bear labels containing the words "for medicinal use only". It appears that the Dawakhana obtained a licence for the year 1952 under the Fruit Products Order 1948 for the manufacture of the Sharbat in question. On analysis, it was found that the said Sharbat did not 196 contain fruit juice, though it was sold as fruit juice. The label ,on the bottle of the Sharbat depicts pictures of fruits. Under the said Order of 1948 the synthetic syrups containing no fruit juice were required to be clearly marked as 'synthetic ' and to abstain from using labels with pictures of fruits. In 1954 when it was found that the Dawakhana did not get the licence renewed, the appellants were asked either to get their licence renewed or to get exemption by complying with the necessary conditions. When the appellants did not comply with these directions, some of the bottles of the Sharbat were detained in the market. That led to a writ petition filed by the appellants in 1.954 (No. 11 D/1954) in the Punjab High Court. When the petition, however, came for final hearing, it was not pressed, and so, was dismissed on June 5, 1954. The Dawakhana then filed a suit for injunction, but the said suit became infructuous with the expiry of the Fruit Products Order, 1948 on January 25, 1955. The present Fruit Order came into force on May 3, 1955; and the Dawakhana filed another suit for injunction, but pending the suit, the appellants applied for and obtained a licence under the Fruit Order and in consequence, the suit was withdrawn on October 18, 1955. Even after obtaining the licence, the requirements of the relevant provisions of the Fruit Order as to the minimum percentage of fruit juice were not complied with by the appellants; and that led to the impugned order. That is the background of the present writ petition. In the present writ petition, the respondents urged that the Sharbat in question is not sold for medicinal purposes; it is manufactured by the appellants as a fruit product and sold as such. No exemption was claimed by the appellants under clause 16 of the Fruit Order. The Sharbat in question is foodstuff within the meaning of section 2 of the Act and it falls within the purview of the Fruit Order. The impugned order is not unconstitutional, because the restriction imposed by it is consistent with the relevant provisions of the Act and the Fruit Order, and the said provisions are perfectly valid, because they impose a reasonable restriction in the interest of general public. This writ petition came on for final disposal before the Punjab High Court on January 13, 1964. The High Court has rejected the pleas raised by the appellants and dismissed their writ petition. The High Court has held that there was no substance in the appellants ' grievance that the Fruit Order was invalid. In support of this conclusion, the High Court has relied upon a decision of this 197 Court in M/s. Amrit Banaspati Co., Ltd. vs The State of Uttar Pradesh(1). The High Court negatived the appellants ' argument that the Sharbat in question was either prepared or sold as a medicinal product. In this connection the High Court has commented ' on the fact that the label borne by the bottles containing the Sharbat did not show that it was for medicinal use only as required by cl. 16 (1) (c) of the Fruit Order According to the High Court, clause 1 1 of the Fruit Order covered the case of the Sharbat prepared by the appellants, and so, the impugned order was justified. The High Court also found that there was no substance in the, grievance made by the appellants that as a result of this impugned order, their registered trade mark label had been affected. The High Court then examined the question as to whether the provisions of the Fruit Order could be said to be invalid, and it held that the said provisions were perfectly valid inasmuch as the restrictions imposed by them were reasonable and in the interests of ' the general public. It is on these grounds that the High Court dismissed the appellants ' petition. Thereafter, the appellants applied for and obtained a certificate from the High Court to come to this Court in appeal. This certificate was granted on July 22, 1964 After the appeal. was admitted in due course, the appellants moved this Court on October 26, 1964 for stay; in fact, during all the seven years that the writ petition was pending before the High Court, the appellants had obtained stay and they wanted the stay to continue pending the final ' disposal of this appeal. When we found that the writ petition had taken an unusually long time in the Punjab High Court, we directed that the stay should continue in favour of the appellants, but that the appeal should be heard on November 9, 1964. That is how the hearing of this appeal has been specially expedited. Before we deal with the points which have been raised before us by Mr. Pathak, we would refer very briefly to the scheme and the relevant provisions of the Act and the Fruit Order. The Act was passed in 1955 for the purpose of controlling the production, supply and distribution of, and trade and commerce in, certain commodities in the interests of the general public. The commodities which were intended to be brought within the purview of the Act were essential commodities as defined by section 2(a) of the Act. Amongst them are included foodstuffs, including edible oil seeds and oils covered by section 2 (a) (v), and any other class of ' commodity which the Central Government may, by notified order, (1) Criminal Appeal No. 141 of 1959 decided on 30 11 1960. 198 declare to be an essential commodity for the purposes of this Act, being a commodity with respect to which Parliament has power to make laws by virtue of entry 33 in List III of the Seventh Schedule to the Constitution; this is included in the definition by section 2 (a) (xi). Section 3 (1 ) provides that if the Central Government is of opinion that it is necessary or expedient so to do for maintaining or increasing supplies of any essential commodity or for securing their equitable distribution and availability at fair prices, it may, by order, provide for regulating or prohibiting the production, supply and distribution thereof and trade and commerce therein. Sub section (2) by clauses (a) to (h) provides for different categories of orders which may be passed by the Central Government without prejudice to the generality of the powers conferred on it by sub section (1). It would thus be clear that the Act confers power on the Central Government to regulate the production, supply and distribution of essential commodities. This power is conferred in a very general and wide sense by section 3 ( 1 ). There can be little doubt that the power to regulate the production of an essential commodity will include the power to regulate the production of essential commodities which may operate either qualitatively or quantitatively. In other words, in regard to essential commodities, the Central Government is given the power to direct how certain essential commodities should be produced and in what quantity. This power, of course, can be exercised only if the condition precedent prescribed by section 3(1) is satisfied, and that is that the Central Government should be of opinion that it is necessary or expedient to regulate the production of any essential commodity for one of the purposes mentioned by it. This position cannot be, and is not, disputed before us. In fact in M/s. Amrit Banaspati Co. Ltd.(1) this Court whilst dealing with the provisions of the Vegetable Oil Products Control Order, 1947, issued under section 3 (1 ) of the Act, has definitely ruled that a qualitative regulation in respect of the production of an essential commodity is permissible under section 3(1) of the Act. That takes us to the Fruit Products Order which was issued by the Central Government on May 3, 1955, in exercise of the powers conferred on it by section 3 of the Act. Clause 2 of the Fruit Order defines 'fruit product '. 2(d) (1) takes in synthetic beverages, syrups and sharbats; cl. 2 (d) (v) takes in squashes crushes, cordials, barley water, barreled juice and ready to serve beverages or any other beverages containing fruit juices or fruit pulp. Clause 2 (d) (xiv) takes in any other unspecified items relating to fruits or vegetables. Clause 2(j) defines "sharbat" as 199 meaning any non alcoholic sweetened beverage or syrup containing non fruit juice or flavoured with non fruit flavours, such as rose, khus, kewra, etc; and cl. 2(k) defines "synthetic beverage" as meaning any non alcoholic beverage or syrups, other than aerated waters, containing no fruit juice but having an artificial flavour or colour resembling as fruit. Clause 7 of the Fruit Order prescribes that every manufacturer shall manufacture fruit products in conformity with the sanitary requirements and the appropriate standard of quality and composition specified in the Second Schedule to this Order; it adds that every other fruit and vegetable product not so specified shall be manufactured in accordance with the standard of quality and composition laid down in this behalf by the Licensing Officer. That takes us to clause II; it is necessary to read this clause fully : (1)Any beverage which does not contain at least 25 per centum of fruit juice in its composition shall not be described as a fruit syrup, fruit juice, squash or cordial or crush and shall be described as a synthetic syrup. (2) Every synthetic syrup shall be clearly and conspicuously marked on the label as a 'SYNTHETIC ' product, and no container containing such product shall have a label, whether attached thereto or printed on the wrapper of such container or, otherwise, which may lead the consumer into believing that it is a fruit product, Neither the word 'FRUIT ' shall be used in describing such a product, nor shall it be sold under the cover of a label, which carries the picture of any fruit. Aerated water containing no fruit juice or pulp shall not have a label which leads the consumer into believing that it is a fruit product. Part II of the Second Schedule to the Fruit Order prescribes the specifications for fruit juice and other beverages. In regard to fruit syrup, it provides, inter alia, that the minimum percentage of fruit juice in the final product must be 25%. The respondents ' contention is that since the Sharbat in question produced by the appellants does not comply with this specification, it contravenes the mandatory provision of cl. 11(1). Part IV of the Second Schedule prescribes the specifications for synthetic syrups and sharbats. Under this Part, there is no requirement as to any minimum of fruit juice in the said syrups and sharbats. 200 Clause 16 of the Fruit Order provides for cases to which this Order does not apply, Clause 16 (1) (c) provides that nothing in this Order shall be deemed to apply to any syrups which are sold in bottles bearing a label containing the words "For medicinal use only" which does not exhibit any picture of fruits. It is common ground that the appellants do not sell the Sharbat in question in bottles bearing a label containing the words "For medicinal use only" and so, cl. 1 6 (1) (c) does not apply and the appellants can claim no exemption on that account. Mr. Pathak no doubt attempted to argue that the Sharbat in question is not an essential commodity and as such, it does not fall within the purview of the Act or within the purview of the Fruit Order. It appears that this plea was not urged by the appellants before the Punjab High Court. It was argued by them before the High Court that the Sharbat in question was a medicinal product; and that point had been considered and rejected by the High Court; and so, it has assumed that the Sharbat in question is an essential commodity within the meaning of section 2 of the Act; that question cannot now be allowed to be argued for the first time before this Court. Mr. Pathak wanted to suggest that the Sharbat in question is not a fruit product and as such, is outside the purview of the Fruit Order. We are not impressed by this argument. We have already referred to cl. 2 (d) (v) of the Fruit Order which refers to several beverages, and the residuary part of this clause takes in any other beverages containing fruit juices or fruit pulp. The suggestion that this clause should be read ejusdem generis with the previous categories of beverages cannot obviously be accepted because an examination of the said beverages will disclose the fact that there is no genus by reference to which the rule of ejusdem generis can be properly invoked. Besides, the context of the clause clearly suggests that it is intended to take in all beverages other than those earlier specified, provided they contain fruit juices or fruit pulp. Therefore, we feel no difficulty in holding that the Sharbat in question falls within the purview of cl. 2 (d) (v) of the Fruit Order and as such, its production can be controlled by its relevant provisions Then it is urged by Mr. Pathak that the Fruit Order itself is invalid, because it does not purport to say that before it was issued, the Central Government had formed the opinion that it was necessary or expedient to issue the Order for maintaining or increasing supplies of the commodity in question. Mr Pathak 201 contends, and rightly, that the condition prescribed by the first part of section 3(1) of the Act is a condition precedent and it is only when and after the said condition is satisfied that the power to issue a regulatory order can be exercised by the Central Government. This contention again cannot be allowed to be raised for the first time in appeal, because if it had been raised before the High Court, the respondents would have had a chance to meet it. It is true, as Mr. Pathak contends, that in the absence of any specific averment made by the Fruit Order that the Central Government had formed the necessary opinion, no presumption can be drawn that such opinion had been formed at the relevant time; but it would have been open to the respondents to prove that such an opinion had been formed at the relevant time; and it cannot be suggested that the failure to mention that fact expressly in the Fruit Order itself would preclude the respondents from proving the said fact independently. That is why we think Mr. Pathak cannot be permitted to urge this contention at this stage. Mr. Pathak, has, however, strenuously argued before us that the Fruit Order is invalid, because its relevant provisions indicate that it is an Order which could have been appropriately issued under the (No. 37 of 1954). In support of this argument, Mr. Pathak has relied on the fact that Act 37 of 1954 is relatable to the legislative power conferred by Entry 18 in List III of the Seventh Schedule to the Constitution which refers to adulteration of foodstuffs and other goods; and so, the material provisions of the Fruit Order which really prevent the adulteration of fruit products could be legitimately enacted under this Act. On the other hand, the is relateable to Entry 33 in List III and the Fruit Order issued under it would, therefore, be inappropriate, having regard to the object which this Order is intended to achieve. He argues that the two powers are distinct and separate, and the Fruit Order with which we are concerned, cannot be said properly to have been issued under the Act. It is true that the does deal with the problem of preventing adulteration of food; but it is not easy to accept Mr. Pathak 's assumption that the regulatory Order of the kind with which we are concerned which imposes regulations Of a qualitative character in the production of essential goods, could have been issued under this Act. But quite apart from this consideration if section 3(1) of the Act authorises the Central Government to regulate the qualitative and quantitative production of essential commodities, it is idle to contend that the regulations p /65 14 202 imposed by the Fruit Order in respect of fruit products are outside the purview of section 3 (1). The pith and substance of the relevant provisions of the Fruit Order clearly is to regulate the qualitative production of fruit products covered by it. This object is illustrated by the specification with which we are concerned. Part II of the Second Schedule to the Fruit Order 1which has imposed the obligation on the manufacturers of fruit 'Syrups to include at least 25% of fruit juice in the final product of the fruit syrup produced by them, shows that by virtue of its powers under section 3 (1) of the Act, the Central Government thought it necessary to require that a particular quality of fruit syrup should be put on the market as fruit syrup and no other. This object plainly falls within the purview of section 3(1), and so, the contention that the Fruit Order is invalid inasmuch as it purports to tackle the problem of adulteration of fruit product, cannot be accepted. Then Mr. Pathak suggested that there was some inconsistency between the definition of 'synthetic beverage ' prescribed by cl. 2 (k) and the provisions of cl. 11 (2) of the Fruit Order. We have already read cl. 11. The effect of cl. 11 (1) is that if any beverage does not contain at least 25 per cent of fruit juice, it shall not be described, inter alia, as 'fruit syrup ', but shall be ,described as a 'synthetic syrup ', and sub cl. (2) of cl. 11 therefore provides that if any syrup which has to be described as a 'synthetic syrup ' by virtue of the provisions of sub cl. (1) is put on the market, it would be necessary to describe it as a 'Synthetic ' product clearly and conspicuously. It is with the object of bringing it to the notice of the customers at large that the synthetic product does not contain the minimum fruit juice prescribed by the Fruit Order that sub cl. (2) imposes an obligation that whoever puts the synthetic product in the market shall mark it with a label "Synthetic" and no attempt would be made to describe the product as though it was a fruit product. That is why a specific provision is made by sub cl. (2) that neither the word "Fruit" shall be used in describing such a product, nor will it bear a label which carries the picture of any fruit. From this provision aerated waters are exempted, because it was thought that no customer would ever mistake aerated water for fruit juice. Now, if we bear in mind this scheme of clause 11, it is difficult to see where the inconsistency lies between cl. 11 and the definition of a 'synthetic beverage ' as prescribed by cl. 2(k). The definition of synthetic beverage indicates that it is a beverage which contains no fruit juice, and clause 11 which contains a positive provision that beverages 203 containing less than 25 per cent fruit juice should be shown as a 'synthetic ' product. The definition of 'synthetic beverage ' cannot be said to conflict with the requirement that the products falling under cl. 11(2) should be sold as 'synthetic ' products. Besides, clause 1 1 contains a positive provision and the validity of the mandatory requirements of cl. 11 cannot be said to be impaired by any alleged inconsistency between the said provision and the definition of 'synthetic beverage ' prescribed by cl. 2 (k) of the Fruit Order. The last contention which Mr. Pathak urged before us is that the impugned order is invalid, because it affects the appellants ' trade mark right. It is not easy to appreciate this argument. We have already held that the Act and the Fruit Order issued by the Central Government by virtue of its powers conferred by section 3(1) of the Act are valid. If that be so, the impugned order which is fully justified by the provisions of the Act and the Fruit Order cannot be challenged as being invalid. The conclusion that the Act and the Fruit Order issued under it are constitutionally valid proceeds on the basis that the restrictions imposed by them are reasonable and in the interests of general public. What the impugned order purports to do is to require the appellants to comply with the reasonable restrictions imposed by the Fruit Order. The fact that incidentally compliance with Fruit Order may tend to affect their trade mark right cannot, in our opinion, render the impugned order invalid. In this connection, it is necessary to bear in mind that appellant No. I would not be justified in con tending that the registered trade mark which is usually intended to distinguish one manufactured article from another can be used by it even though it is likely to mislead the customers, or its use would mean a breach of some other law. Besides, it is significant that the impugned order does not really compel the appellants to change their trade mark. If the appellants desire that the Sharbat in question should be put on the market without complying with the requirements of clause 1 1 ( 1 ), all that they to do is to comply with cl. 1 1 (2) of the Fruit Order. In the process of complying with cl. 1 1 (2), if their trade mark right is likely to be affected, that would not render the impugned order invalid, because the restriction which is sought to be enforced against them is found to be reasonable and in the interests of the general public. Besides, we would like to add that if the appellants wanted to urge this point seriously, they should have placed before the Court more material in respect of their alleged trade mark right. The appellants had alleged in their writ petition that they are putting the 204 Sharbat on the market as a medicinal product. In that case, they may claim exemption by complying with cl. 16 (i) (c) of the Fruit Order. We are, therefore satisfied that the Punjab High Court was right in holding that no case had been made out by the appellants for quashing the impugned order. Before we part with this appeal, we would like to refer to one unfortunate aspect of the present proceedings. We have already indicated that the present writ petition was filed by the appellants in the Punjab High Court on May 18, 1957, and it was finally decided on January 13, 1964. It is very much to be regretted that the final disposal of this writ petition should have taken such an unusually long period. The appellants have been agitating this matter since 1957 and as a result of the long duration of the present writ petition in the High Court, they have had the benefit of the stay order all this time, though ultimately it was found that there was no substance in the petition. It is hardly necessary to add that writ petitions in which orders of stay and injunction are passed, should be decided as expeditiously as possible. That is why when it came to the notice of this Court that this writ petition has taken an unusually long period in the High Court, we directed that it should be set down for hearing within a fortnight after it was brought to us on a notice of motion for stay. The result is, the appeal fails and is dismissed with costs. Appea1 dismissed.

The appellants manufacture a medicated syrup "Sharbat Rooh Afza" according to a formula and containing some fruit juices. Acting under section 3 of the , the Central Government made the Fruit Products order in 1955; as a result of an amendment in September 1956 of the relevant provisions of this Order, the requirement of the minimum percentage of fruit juices in a fruit syrup covered in of the Second Schedule of the Fruit Order was raised from 10% to 25%. This requirement was duly notified to the Appellants. Thereafter as a result of an inspection of their factory by the Marketing development Officer, the appellants received an order from him requiring them to stop further manufacture and sale of 'Sharbat Rooh Afza ' forthwith on the ground that it did not contain the minimum percentage of fruit juices prescribed by the relevant provisions of the Fruit Order. The appellants challenged this order in a Writ Petition on the ground, inter alia, that the Fruit Order did not apply to 'Sharbat Rooh Afza ' and also that the impugned order and the Fruit Order were invalid. The High Court, however, rejected these grounds, upheld the validity of the Fruit Order and dis missed the petition. It was contended on behalf of the appellants that the 'Sharbat ' was a medicinal product and not a 'fruit product ' as defined by cl. 2(d) of the Fruit Order; that the Fruit Order was invalid because it could have appropriately been issued only under the , and not the ; and that the impugned order was invalid because it affected the appellant 's Trade mark rigts. HELD : (i) The Sharbat was a fruit product within the meaning of cl. 2(d) (v) of the Fruit order as the residuary part of that clause took in any beverages containing fruit juices or fruit pulp; as such, its production could be controlled by the relevant provisions of the order. The High Court was right in rejecting the appellant 's contention that the Sharbat was a medicinal product in view of the fact that the appellants had not claimed exemption from the application of the Fruit Order by complying with Cl. 16(1)(c) thereof. [200 E G; 201 H; 203 A] (ii)As section 3(1) of the authorised the Central Government to regulate the qualitative and quantitative production of essential commodities, and as the pith and substance of the relevant provisions of the Fruit Order was clearly to regulate the qualitative production of the Fruit Products covered by it, the contention that the regulations imposed by the order were outside the purview of section 3(1), could 193 not be accepted. The order was not therefore invalid on the ground that it purported to tackle the problem of adulteration and should therefore have been issued under the . [201 D 202 C] (iii)The Fruit Order and the Act under which it was issued were constitutionally valid as the restrictions imposed by them were reasonable and in the interest of the general public. What the impugned order purported to do was to require the appellants to comply with reasonable restric tions imposed by the Fruit Order and the fact that, incidentally, compliance with the Fruit Order might tend to affect the trade mark rights, could not render the impugned order invalid. [203 D E] (iv)The definition of 'synthetic beverage ' in cl. 2(k) of the Fruit Order which indicates that it is a beverage which contains no fruit juice cannot be said to conflict with the requirements of cl. 11(2) that beverages containing less than 25% fruit juices should be sold as 'synthetic ' pro ducts. Furthermore, cl. 11 contains a positive provision and the validity of the mandatory requirements of cl. 11 could not be impaired by the alleged inconsistency between that provision and the definition of 'synthetic ' beverage prescribed by cl. 2(k). [203 A B] Amrit Banaspati Co. Ltd. vs The Stale of U.P. Cr. A. No. 141 of 1959 dated 30 11 60, referred to.

N: Criminal Appeal No. 154 of 1975. Appeal by Special Leave from the Judgment and order dated the 18th February 1975 of the Madhya Pradesh High Court at Jabalpur in Criminal Appeal No. 789 of 1972. Sarju Prasad and section N. Prasad for the Appellant. Ram Panjwani, Dy. Advocate General, M.P., H. section Parihar and I. N. Shroff for the Respondent. The Judgment of the Court was delivered by GOSWAMI, J. To adjust the duration of imprisonment to the gravity of a particular offence is not always an easy task. Sentencing involves an element of guessing but often settles down to practice obtaining in a particular court with inevitable differences arising in the context of the times and events in the light of social imperatives. It is always a 714 matter of judicial discretion subject to any mandatory minimum prescribed by law. Hegel in his 'Philosophy of Right ' pithily put the difficulty as follows: "Reason cannot determine, nor can the concept provide any principle whose application could decide whether justice requires for an offence (i) a corporal punishment of forty lashes or thirty nine, or (ii) a fine of five dollars or four dollars ninety three, four, etc., cents, or (iii) imprisonment of a year or three hundred and sixty four, three, etc., days, or a year and one, two, or three days. And yet injustice is done at once if there is one lash too many, or one dollar or one cent, one week in prison or one day, too many or too few". The present appeal by special leave being limited to sentence we are to consider about the appropriate deserts for the appellant in this case. The appellant was a Circle organizer in the Tribal Welfare Department at Lohandiguda in the State of Madhya Pradesh. He was entrusted with the distribution of stipends to Adivasi students of the Tribal Welfare Department School. He misappropriated a sum of Rs. 500/ meant for four students and also forged certain entries in the bills. He was convicted under section 409 and section 467 IPC by the Sessions Judge and sentenced for each head of charge to con current four years ' rigorous imprisonment and also to a fine of Rs. 500/ , in default to rigorous imprisonment for six months. The High Court on appeal maintained the conviction but reduced the sentence to two years ' rigorous imprisonment maintaining the fine. From a perusal of the judgment of the High Court which is the only document in the paper book in addition to the special leave petition, it is not very clear about the offence of forgery committee by the accused. We would, however, say nothing more than that. In judging the adequacy of a sentence the nature of the offence, the. circumstances of its commission, the age and character of the offender, injury to individuals or to society, effect of the punishment on the offender, eye to correction and reformation of the offender, are some amongst many other factors which would be ordinarily taken into consideration by courts. Trial courts in this country already over burdened with work have hardly any time to set apart for sentencing reflection. This aspect is missed or deliberately ignored by accused lest a possible plea for reduction of sentence may be considered as weakening his defence. In a good system of administration of criminal justice pre sentence investigation may be of great sociological value. Through out the world humanitarianism is permeating into penology and the courts are expected to discharge their appropriate roles. 715 The appellant is a youngman of about 30 years. He is an educated person who was employed in Government service. But for the forgery he could have been tried in the court of a first class Magistrate for the offence under section 409 IPC and in that case the maximum sentence of imprisonment would have been two years ' rigorous imprisonment on the face of the High Court 's judgment, as noticed above, the part played by the appellant in the forgery is rather a little obscure. The appellant is sure to lose his employment under the Government. There is already indignity heaped upon him on account of conviction. He has the opportunity to commit such offence as a Government servant in the future. Any sentence of imprisonment imposed upon him will be a deterrent to others similarly disposed in such unlawful pursuits. The appellant was refused bail in this Court and he is said to have served about nine months in prison. While we do not minimise the seriousness of the offences, having regard to the circumstances mentioned above, we are of opinion that it will meet the ends of justice in this case if we order, which we do, that the appellant 's sentence be reduced to one year 's rigorous imprisonment only and in addition to a fine of Rs. 500 only, in default rigorous imprisonment for six months. The appeal is partly allowed with modification of the sentence as ordered. P.H.P. Appeal partly allowed.

The appellant was a Circle organizer in the Tribal Welfare Department. He was entrusted with the distribution of stipends to adivasi students of the Tribal Welfare Department School. He misappropriated a sum of Rs. 500/ . meant for 4 students and also forged certain entries in the bills. He was convicted under section 409 and section 467 of I.P.C. by the Sessions Judge and ` sentenced to 4 years rigorous imprisonment and a fine of Rs. 500/ . The High Court on appeal maintained the conviction but reduced the sentence to 2 years rigorous imprisonment and a fine of Rs. 500/ . on an appeal by Special leave limited only to the question of sentence. ^ HELD: 1. To adjust the duration of imprisonment to the gravity of a particular offence is not always an easy task. It is always a matter of judicial discretion subject to any mandatory minimum prescribed by law. In judging the adequacy of a sentence, the nature of the offence, the circumstances of its commission, the age and character of the offender, injury to individuals or to Society, effect of the punishment on the offender, eye to correction or reformation of the offender, are some amongst many other factors which would be ordinarily taken into consideration by courts. [713GH, 714 FG] 2. Trial Courts in this country already over burdened with work have hardly any time to set apart for sentencing reflection. In a good system of administration of criminal justice pre sentence investigation may be of great sociological value. Throughout the world humanitarianism is permeating into penology and the courts are expected to discharge their appropriate roles. [714 GH] 3. Without minimising the seriousness of the offence, having regard to the circumstances of the case, the sentence was reduced from 2 years to one year [715 C]

iminal Appeal No. 97 of 1957. Appeal by special leave from the judgment and order dated November 20,1956, of the Andhra Pradesh High Court at Hyderabad in Criminal Confirmation Case No. 18 of 1956 and Criminal Appeal No. 240 of 1956 arising out of the judgment and order dated April 25, 1956, of the Court of the Sessions Judge at Karimnagar in Criminal Case No. 9/8 of 1956. R. C. Prasad, for the appellant. R. H. Dhebar and T. M. Sen, for the respondent. July 15. The Judgment of the Court was delivered by SINHA J. The main question for determination in this appeal by special leave is whether and, if so, how far non compliance with the provisions of sections 173(4) and 207A(3) of the Code of Criminal Procedure, has affected the legality of the proceedings and the trial resulting in the conviction of the appellant. The appellant was tried by the learned Sessions Judge of Karimnagar in what used to be the State of Hyderabad (now part of the State of Andhra Pradesh), under section 302 of the Indian Penal Code, for the murder of his brother Baga Rao, and sentenced to death. The conviction and the sentence were affirmed by the High Court of Judicature of Andhra Pradesh, at Hyderabad, on appeal and on a reference by the learned Sessions Judge. Along with the appellant, three other persons, named Lingarao, the appellant 's brother, Narsingrao, the nephew of the appellant and son of Lingarao 285 aforesaid, and Mahboob Ali, said to be a close friend of the other accused, were also tried under section 302, read with sections 34 and 109 of the Indian Penal Code, and convicted and sentenced to imprisonment for life. Their appeals also were heard along with the appeal preferred by the appellant and by a common judgment, the High Court dismissed all the appeals and confirmed the convictions and sentences passed against all the four accused persons. This appeal concerns only Narayan Rao who has been sentenced to death by the courts below. The facts of the case are short and simple. The murdered man Baga Rao, who was an excise contractor, had separated from his other brothers aforesaid, and had partitioned the family lands. There were differences amongst the brothers which had led to arbitration proceedings a few months earlier, which did not satisfy Baga Rao. On the Saturday previous to the Monday, December 26, 1955, which was the day of the occurrence, there was a quarrel between Baga Rao on one side and Lingarao and Narsingrao on the other in the field said to belong to Baga Rao. The parties reside in village Kollamaddi taluk Sircilla, district Karimnagar. At about 7 a.m. "on the morning of December 26, 1955, Baga Rao had been proceeding from his village towards Nirmal side. The accused, who appears to have been lying in wait for Baga Rao, came running from behind and the appellant fell upon Baga Rao with his knife. The other accused persons caught hold of Baga Rao and the appellant inflicted several injuries on his person with his knife (M.O. 13). At first, Baga Rao got himself released from the grip of Narsingrao but the latter chased him and overtook him. All the accused overpowered him by catching hold of the different parts of his body, and the appellant stabbed him in the regions of the neck, abdomen, thigh and other parts of his body, the fatal injuries being in the neck and the abdomen. At the time of the occurrence, P.W. 1, father 's brother of the appellant, who also was proceeding towards Nirmal, saw most of the occurrence and then, out of fear, hid himself in a hut nearby. P.W. 2 a boy of about 12 286 years a student of 4th standard in a Government school, was also proceeding in that direction that morning, and saw the whole occurrence from beginning to end from a short distance of a few yards. This young boy claimed the murdered Baga Rao as his maternal uncle, stating that his mother is the sister of Baga Rao. But the wife of the murdered man, P.W. 6, stated in cross examination that P.W. 2 Ramchander Rao is distantly related to her husband and that he is not the son of her husband 's sister. The father of the murdered man, Chatriah, aged about 85 years, who has been examined as defence witness No. 1, disclaimed all relationship with the said P.W. 2, but stated that he is related to Dharmiah, P.W. 1, who is no other than his full brother. Chatriah, the father, had been examined to support the defence suggestion that it was P.W. 1, Dharmiah Rao and his son who got Baga Rao murdered and falsely implicated the accused persons. That evidence has naturally not been accepted by the courts below because such a case was never sought to be made out at any previous stage of the proceedings until his examination in court. D.W. 2 who claims to be the son in law of P.W. 1, was examined only to prove that there had been a rivalry between P.W. I and the accused persons for the purchase of some land. His evidence was rejected as vague and of no relevance. The case against the appellant, as also against other accused persons not before this Court, rested mainly on the evidence of Dharmiah P.W. I and Ramchander Rao, P.W. 2, who figure as the eye witnesses. Besides their testimony, there is the evidence of the recovery of the blood stained garments from the houses of the accused persons and the blood stained knife found near the dead body, and identified in court as belonging to the appellant, which were all found by the chemical examiner, to have stains of human blood. The courts below have relied upon the evidence of the eye witnesses, corroborated by the incriminating circumstances aforesaid, and have agreed in convicting and sentencing the accused as stated above. 287 We have been taken through the evidence in this case and after having heard counsel for the appellant, we do not see any reasons to differ from the courts below in their estimate of the evidence adduced by the prosecution in support of the case against the appellant. Hence, in our opinion, there is no ground for interference with the conclusions of the courts below on the merits of the case. It now remains to consider the question of law which has been seriously pressed upon us. It has been argued, as was admitted by the learned Government Advocate before the High Court, that the provisions of sections 173(4) and 207A(3) of the Code of Criminal Procedure, have not been complied with, and that, as a necessary consequence of those omissions, the entire proceedings and the trial are vitiated. It is convenient at this stage to set out the course, in some respects rather unusual, of the proceedings before the police and the committing magistrate as also at the trial before the learned Sessions Judge. When P. W. 1 aforesaid informed Gopal Rao (P. W. 8) Police Patel about the occurrence, he drew up the first information report at about 11 a.m., on December 26. All the four accused were named as the culprits in the first information report. He issued that report to the station house, Gambhiraopet, about 5 miles from the place of occurrence. The Sub Inspector of police, P.W. 11, proceeded to the spot and prepared the inquest report. He found the throat of the deceased cut, besides other injuries on the left side of the stomach and right thigh and three wounds on the left hand. Two panchas, Lachmayya and Ramayya (P.W. 10), were called by the police officer and in their presence and under their signatures, he entered a long note as to what the panchas saw on the spot, and then follows the substance of the statements of the eye witnesses, P.Ws. 1 and 2, aforesaid. This record of the statements of the two eye witnesses, aforesaid, made the same day when the occurrence took place, has been made to serve the double purpose of what the police officer and the panchas aforesaid saw and heard at the spot, as also the record of the substance of the 288 two main witnesses for the prosecution before the investigating police officer. The post mortem report, made the next day, December 27, corroborated the nature of the injuries stated above, and added that the incised wound across the lower part of the neck, had cut the vital organs like trachea, oesophagus and the jugular vein. The prosecution also proved, as exhibit P 5, the panchnama prepared the same day and signed not only by the panchas but purporting to have been signed also by the accused persons. This document is a record which is a complete confession of the crime from the beginning to the end by all the accused persons. This was highly irregular, but fortunately, it was not a jury trial and has not, therefore, done much harm to the accused persons, but certainly the provisions of the Evidence Act and of the Code of Criminal Procedure have not been observed. On January 10 and 11, 1956, the learned Munsiff Magistrate recorded the full length statements of Ramchander Rao as P.W. 1, and of Dharmiah Rao, P.W. 2, under section 164 of the Code of Criminal Procedure. Apparently, the police, apprehending that those two persons were related to three out of the four accused, took the precaution of having their statement so recorded. The police report under section 173 of Criminal Procedure Code was made by the investigating police officer on January 11, 1956, and was placed before the Munsiff Magistrate on January 12. It gives a very complete statement of the prosecution case and the names and full description 'of the witnesses to be examined in support of the prosecution case. The learned Munsiff Magistrate appears to have examined the investigating police officer as P.W. 1, and the two eye witnesses, Dharmiah and Ramchander Rao, as P.Ws. 2 and 3, and the medical officer as P.W. 4, on or about February 15, 1956. The record of the statement of the medical officer appears in the paper book, but the evidence of the other three witnesses does not appear in the paper book. On February 16,1956, the learned Munsiff Magistrate put very detailed questions to each one of the accused persons and placed the evidence of all the witnesses examined by him in detail, to the 289 accused persons who have denied their complicity in the crime and who alleged enmity with the two eyewitnesses aforesaid. The committal order, if any, is not before us. The learned Munsiff Magistrate framed a charge for murder under section 302, against the appellant, and ' for participation in the crime, against the other three accused, under section 302, read with sections 34 and 109 of Indian Penal Code. He again put a number of questions to each one of the accused persons as to what they had to say against the charges framed and as to what they had to say in their defence. It does not appear that before the learned Munsiff Magistrate who was holding his inquiries under section 207A(3) and (4), any grievance was made that the provisions of section 173(4) had not been complied with by the police officer in charge of the investigation. Nor does it appear that any request was made, to call upon the police officer concerned, to furnish to the accused, copies referred to in sub section (4) of section 173 of the Code. There is no indication in the record that even when the accused persons were placed on their trial before the learned Sessions Judge, any such grievance or any such request was made to that court. The cross examination of the eye witnesses aforesaid has been done at some length, and there are also references to the record made by the police officer during the investigation. It was only after the conviction and sentences of the accused persons by the learned Sessions Judge, when the appeals were preferred to the High Court, that the ground is raised, for the first time, in the memoranda of appeal in these terms: "The lower court has lost sight of the fact that the mandatory provisions of sections 173, 207A and other sections of the Code of Criminal Procedure have not been complied with, and this fact has caused a complete failure of justice." The High Court, while dealing with this ground of appeal, has observed that the learned Government Advocate, while conceding that the committing court had not complied with the provisions of those sections, had urged that the omission was not sufficient to 37 290 vitiate the trial unless the accused succeeded in showing that they had been prejudiced in their defence. They further observed that when the accused got the copies in the Sessions Court before the recording of the statement of the witnesses, it could not be said that the accused had been so prejudiced. The High Court finds, as a fact, that the accused got the necessary copies of the depositions of the witnesses in the Sessions Court before the statements of the prosecution witnesses were recorded by that court. The High Court also remarked that it was not denied that the copies were supplied a day earlier, but that there was nothing to show that the accused made any grievance that the time at their disposal was too short to enable them to cross examine the prosecution witnesses, or that they prayed for an adjournment of the case in order to enable them to effectively cross examine those witnesses. In view of these considerations, the High Court held that the accused had failed to show any prejudice. Before us, no attempt was made to show that the non compliance with the provisions of sections 173(4) and 207A(3) had caused any prejudice to the accused. The learned counsel for the appellant sought to argue that the omission had the effect of vitiating the entire proceedings ending in the trial of the accused, and that, therefore, ipso facto, a fresh trial became necessary irrespective of whether or not the accused had shown any prejudice. In other words, he contended that these illegalities rendered the proceedings null and void and that the Court need not stop to consider the question of prejudice. Section 173, sub section (4), of the Code of Criminal Procedure was amended by the Code of Criminal Procedure Amendment Act, 26 of 1955, by adding the following: "(4) After forwarding a report under this section, the officer in charge of the police station shall, before the commencement of the inquiry or trial, furnish or cause to be furnished to the accused, free of cost, a copy of the report forwarded under sub section (1) and of the first information report recorded under section 154 and of all other documents or relevant extracts 291 thereof, on which the prosecution proposes to rely, including the statements and confessions, if any, recorded under section 164 and the statements recorded under sub section (3) of section 161 of all the persons whom the prosecution proposes to examine as its witnesses. (5)Notwithstanding anything contained in subsection (4), if the police officer is of opinion that any part of any statement recorded under sub section (3) of section 161 is not relevant to the subject matter of the inquiry or trial or that its disclosure to the accused is not essential in the interests of justice and is inexpedient in the public interests, he shall exclude such part from the copy of the statement furnished to the accused and, in such a, case, he shall make a report to the Magistrate starting his reasons for excluding such part : Provided that at the commencement of the inquiry or trial, the Magistrate shall, after perusing the part so excluded and considering the report of the police, officer, pass such orders as he thinks fit and if he so directs, a copy of the part so excluded or such portion thereof, as he thinks proper, shall be furnished to the accused. " In order to simplify commitment proceedings preceding the trial of accused persons by a court of Session,s. 207A was added by way of amendment of the Code at the same time. In the added section 207A, sub sections 3 and 4, which are material portions of that section, are in these terms : " (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 same to be so furnished. (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 292 to take the evidence of any one or more of the other witnesses for the prosecution, he may take such evidence also. " It will thus appear that in cases exclusively triable by a court of Session, it is the duty of the magistrate, while holding a preliminary inquiry, to satisfy himself that the documents referred in s.173 have been furnished to the accused and if he found that the police officer concerned had not carried out his duty in that behalf, the magistrate should see to it that is done. After the accused have been furnished with the necessary documents, it is now required to record evidence of only such witnesses for the prosecution as had witnessed the actual commission of the offence charged against the accused and of such other witnesses as he may consider necessary in the interests of justice. From what has been said above, it is clear that the Munsiff Magistrate did record the evidence as required by sub section (4) of section 207A. But it has been found by the High Court, on the admission of the Government Advocate, that the provisions of sub section 3 of section 207A had not been complied with. It is not clear as to whether all the documents contemplated by section 173(4), quoted above, had not been furnished to the accused or documents other than the statements of witnesses had not been so supplied. The judgment of the High Court would appear to indicate the latter, but we shall proceed on the assumption that there was, an entire omission to carry out the provisions of subs. (4) of section 173, read with sub section 3 of section 207A. Does such an omission necessarily render the entire proceedings and the trial null and void; or is it only an irregularity curable with reference of the provisions of section 537 (a) of the Code ? In other words, are the provisions of section 173(4), read with section 207A(3) mandatory or only directory ? There is no doubt that those provisions have been introduced by the amending Act of 1955, in order to simplify the procedure in respect of inquiries leading upto a Sessions trial, and at the same time to safeguard the interests of accused persons by enjoining upon police officers concerned and magistrates, before whom such proceedings are brought, to 293 see that all the documents, necessary to give the accused persons all the information for the proper conduct of their defence, are furnished. It has rightly been contended on behalf of the appellant that it was the duty of the magistrate to see that the provisions aforesaid of the Code have been fully complied with. Magistrates, therefore, have to be circumspect, while conducting such proceedings, to see to it that accused persons are not handicapped in their defence by any omission on the part of police officers concerned, to supply the necessary copies. But we are not prepared to hold that non compliance with those provisions has, necessarily, the result of vitiating those proceedings and subsequent trial. The word "shall" occurring both in sub section (4) of section 173 and sub section (3) of section 207A is not mandatory but only directory, because an omission by a police officer, to fully comply with the provisions of section 173, should not be allowed to have such a far reaching effect as to render the proceedings including the trial before the court of Session wholly ineffective. Instead of simplifying the procedure, as was intended by the amending Act, as indicated above, the result contended for on behalf of the appellant, will, necessarily, result in re opening the proceedings and trials which may have been concluded long ago. Such a result will be neither conducive to expeditious justice nor in the interest of accused persons themselves. Certainly, if it is shown, in a particular case, on behalf of the accused persons that the omission on the part of police officers concerned or of the magistrate before whom the committal proceedings had fended, has caused prejudice to the accused, in the interest of justice, the court may reopen the proceedings by insisting upon full compliance with the provisions of the Code. In our opinion, the omission complained of in the instant case should not have a more farreaching effect than the omission to carry out the provisions of section 162 or section 360 of the Code. Courts in India, before such matters were taken to their Lord. ships of the Judicial Committee of the Privy Council, had taken conflicting views on the scope of section 537 of the Code in curing such omissions as aforesaid. In the 294 case of Abdul Rahman vs The King Emperor(1), their Lordships of the Judicial Committee had to consider the effect of non compliance with the provisions of section 360 of the Code. After considering the relevant provisions of the Code, their Lordships came to the conclusion that it was a mere irregularity which could be cured by the provisions of section 537. In the case of Pulukuri Kotayya and others vs King Emperor (2), the Judicial Committee had to consider the effect of breach of the statutory provisions of section 162 of the Code. The following observations of their Lordships, at pages 75 76, are a complete answer to the arguments advanced on behalf of the appellant before us, and we respectfully adopt them: " When a trial is conducted in a, manner different from that prescribed by the Code (as in N. A. Subramania Iyer 's case (3)), the trial is bad, and no question of curing an irregularity arises; but if the trial is conducted substantially in the manner prescribed by the Code, but some irregularity occurs in the course of such conduct, the irregularity can be cured under section 537, and none the less so because the irregularity involves, as must nearly always be the case, a breach of one or more of the very comprehensive provisions of the Code. The distinction drawn in many of the cases in India between an illegality and an irregularity is one of degree rather than of kind. This view finds support in the decision of their Lordships ' Board in Abdul Rahman vs The King Emperor (1), where failure to comply with section 360 of the Code of Criminal Procedure was held to be cured by sections 535 and 537. The present case falls under section 537, and their Lordships hold the trial valid notwithstand ing the breach of section 162. " In the instant case, the facts as stated above are extremely simple. It was a case of a day light murder by four persons acting in concert and way laying the deceased when lie was out on business that morning. Two persons, more or less related to three of the accused (1)(1929) L.R. 55 I.A. 96. (2)(1947) L.R. 74 I.A. 65, 75 76. (3) (1901) L.R. 28 I.A. 257. 295 persons, gave evidence as eye witnesses to the occurrence. Their statements were recorded by the police in some detail in the inquest report itself on the very day of the occurrence. There was not much scope for variations in their statements during police investigation and those before the court. It was a simple case of either believing or disbelieving those two eye witnesses. As already indicated, all the four accused persons including the appellant were named at the earliest opportunity in the first information report which was lodged without any avoidable delay within a few hours after the occurrence. Both the courts below have preferred to rely upon the testimony of the two eye witnesses, corroborated by the circumstantial evidence referred to above. They have rejected the defence suggestions supported as they are by the two defence witnesses, one of whom is a common ancestor of three of the four accused persons. It has not been argued, and there is no scope for the argument, that the accused persons have been prejudiced in any way in their defence. They had to meet a straightforward case which they failed to do. After carefully considering the arguments advanced on behalf of the appellant, we have come to the conclusion that the proceedings and the trial have not been vitiated by the admitted non compliance with the provisions aforesaid of the Code, and that the irregularity is curable by reference to section 537 of the Code, as no case of prejudice has been made out. This Court, in the case of Gurbachan Singh vs The State of Punjab (1), was inclined to take a similar view of the provisions aforesaid of the Code, though it ultimately held that those provisions did not apply to the case then before them. The appeal is accordingly dismissed. Appeal dismissed. (1) Criminal Appeal No. 48 of 1957, decided on April 24, 1957.

The word 'shall ' occurring in sub section (4) Of section 173 and sub section (3) Of section 207A of the Code of Criminal Procedure is not mandatory but directory and a non compliance with the provisions of those subsections, unless it can be shown to have prejudiced the accused person in his defence, cannot invalidate the commitment proceedings or the subsequent trial. Magistrates holding inquiries under section 207A(3) Of the Code of Criminal Procedure must, however, be circumspect and see that an accused person is not handicapped in his defence by any omission on the part of the Police Officer to furnish him with necessary copies. Where such non compliance is found to cause any prejudice to the accused, the Court should in the interest of justice reopen the proceedings and insist on a full compliance with the provisions. When it causes no prejudice, it is a mere irregularity curable under section 537 Of the Code. Abdul Rahman vs The King Emperor, (1929) L.R. 55 I.A. 96, Pulukuri Kolayya vs King Emperor, (1947) L.R. 74 I.A. 65 and Gurbachan Singh vs The State of Punjab, Cr. A. NO. 48 of 1957 applied. 284 Consequently, in a case where an accused person was com mitted to the Court of Session on a charge under section 302 of the Indian Penal Code and found guilty thereunder by the Sessions judge and awarded the capital sentence and the order of conviction and sentence was unassailable on merits, but the Police Officer had omitted to furnish him copies as required by section 173(4) and the inquiring Magistrate to cause such copies to be furnished to him under section 207A(3) of the Code of Criminal Procedure and such omission could not be shown to have in any way prejudiced the accused person in his defence, it was a mere irregularity that did not vitiate either the commitment proceedings or the trial and was cured by section 537 Of the Code.

Civil Appeal No. 8454 (NL) Of 1983. From the Judgment and order dated the 8th August, 1980 of the Madhya Pradesh High Court Bench at Gwalior in Civil Miscellaneous Petition No. 127 of 1972. H.K. Puri, for the Appellant. A.K. Sanghi for the Respondent. J. This is an appeal, by special leave, against the Judgment dated 8th August, 1980, by the High Court of Madhya Pradesh at Jabalpur in Civil Miscellaneous Petition No. 127 of l972. The appellant is a trade union registered under the Trade Union Act. It represents employees in the Chambal Hydel Irrigation Scheme under the Department of Chambal Project of Government of Madhya Pradesh in Gwalior Division. The union raised three demands and served notices of these demands on the Deputy Chief Engineer, Major Project, Chambal, Bhopal. The demands were: (1) Chambal allowance; (2) Dearness allowance equal to that of the Central Government employees; and (3) Wages for the 1022 period of strike lasting 20 days in the year 1966. Copies of these notices were sent to the Assistant Labour Commissioner, Indore and the Secretary, Government of Madhya Pradesh. The Deputy Chief Engineer did not respond to the demands. There upon, the Assistant Labour Commissioner, Gwalior, at the instance of the union tried for a settlement, but did not succeed. He sent a report under Section 12(4) of the Industrial Disputes Act. The State Government, the first respondent in the appeal refused to refer the matter to the concerned Tribunal by its order dated 15.3.1969. The appellant took the matter before the High Court by filing Miscellaneous petition No 29/69 for a mandamus to the State Government to refer the dispute for adjudication. The High Court allowed the writ petition. quashed the order of the State Government dated 15th March, 1969, and directed it to consider the question whether a reference was necessary or not. When the matter went back to the Government, the Government took the stand that the provisions of the Industrial Disputes Act were not applicable to the workmen in the Chambal Hydel Irrigation Scheme since the Scheme was not an Industry and hence again refused to refer the dispute to the Tribunal. The appellant pursued the matter further by filing miscellaneous petition No. 45 of 1970 before the High Court. The High Court allowed the petition and directed the Government to take suitable action under Section 12(5 of the Act. The Government challenged this decision before this Court by filing S.L.P.No. 933 of 1972, without success. The matter, therefore, went back to the Government again. 'By its order dated 13.1.1972, the State Government referred only one question to the Tribunal and that related to the wages for the strike period but declined to refer the other two questions. The reason given for this was: (1) that the Government was not in a position to bear the additional burden; and (2) that grant of the special allowance claimed would invite similar demands by other employees which would affect the entire administration. Miscellaneous Petition No. 127 of 1972 was, therefore, filed for a direction to the State to refer the other two demands also. In the meanwhile, this Court as per its decision dated July 20, 1978, bad confirmed the decision of the High Court that Chambal Project was an Industry within the meaning of the Industrial Disputes Act. After this decision was rendered by this Court, the Government reviewed the matter and passed an order on 3.5.1979 giving additional reasons for refusing to refer the dispute for adjudication. The reasons stated were as under: 1023 "(1) That the State Government was not in a position A to pay dearness allowance equal to that of Central Government employees. In the present situation the State Government would not pay dearness allowance equal to that of Central Government employees to any particular department. the question of such payment to the petitioners, therefore, does not arise. B (2) The work charged employees were already given a consolidated pay. Therefore, there was no justification for paying such employees the Chambal allowance. The rules regulating the service conditions of the work charged employees of the Chambal division do not provide for payment of Chambal allowance to them. ' ' 3. Before the High Court, it was contended by the appellant that the State Government had by refusing to refer the dispute to the Tribunal giving the above reasons taken upon itself the power to decide the dispute and had usurped the powers of the Tribunal. It was further contended that the question raised related to the conditions of service of the employees and was, therefore, a matter primarily to be decided by the Tribunal The High Court repelled the contention and held as follows: "It is now 12 years that the matter has been pending. But it would appear from the history of the case that the delay has been mostly due to the fact that the case was pending before various Courts. The Government has not materially changed its stand. As regards Chambal allowance, they were, from the very inception, taking the stand P that the work charged employees of the Project were given a consolidated salary and the service conditions did not warrant payment of extra allowance. Now the rules regulating service conditions of the work charged employees of the project did not contain the provision for payment of Chambal allowance to them. The Government was of the opinion that prima facie no case arises, particularly, when the extra benefit was already being granted to them. The Government undoubtedly could no decide the matter finally, but they could certainly consider whether a prima facie case for reference has been made out on merits. If no case is made out, it would be open to the Government to refuse 1024 to refer such a question and it could not be said that the Government was usurping the functions of the Tribunal and deciding the case finally. In our opinion, the State Government 's order could not be said to be punitive and it takes into account the entitlement of the Chambal employees for the Chambal allowance. As regards the other question, the State Government are on a firmer ground. Since the Government is not paying dearness allowance equal to that of the Central Government employees to the employees in any other department in the State, there is no reason to discriminate and pay the same to the Chambal employees. This is what the State Government have stated and we think that if the allowance at the rate payable to the Central Government employees is not paid to any one in the State, the Government was justified in holding that no prima facie case has been made out by the petitioner for referring this dispute to the Tribunal. The State Government have also considered the question of expediency that by payment of such allowance to the Chambal employees alone, there would be dissatisfaction amongst the other employees of the State. Both these reasons are germane and relevant. The Government here was not deciding the case finally. It has to decide question of expediency and whether a prima facie case has been made out. " In support of this conclusion the High Court relied upon the observations made by this Court in Bombay . Union of Journalists P vs State of Bombay(l) and held that the Government was not precluded from making a prima facie examination of the merits of the dispute while considering whether a reference was necessary or not. It was further held that "the two reasons given by the State Government fulfilled necessary test laid down by the orders of this Court earlier and the various Supreme Court decisions cited by the petitioners. In the appeal before us, it was contended that the approach made by the High Court was erroneous and that the High Court had failed to properly delineate the jurisdiction of the Government under Section 10 read with Section 12(5) of the Industrial Disputes (1) ; 1025 Act. It was contended before us that the question raised by the appellant had to be decided by the Tribunal on evidence to be adduced before it and it could not be decided by the Government on a prima facie examination of the facts of the case. This submission was met with the plea that the Government had in appropriate cases at least a limited jurisdiction to consider on a prima facie examination of the merits of the demands, whether they merited a reference or not. We have considered the rival contentions raised before us The High Court apparently has relied upon the following passage in Bombay Union of Journalists vs State of Bombay, (Supra) C ". .But it would not be possible to accept the plea that the appropriate Government is precluded from considering even prima facie the merits of the dispute when it decides the question as to whether its power to make a reference should be exercised under Section 10(1) read with Section 12(5) or not. If the claim made is patently frivolous, or is clearly belated, the appropriate Government may refuse to make a reference. Likewise, if the impact of the claim on the general relations between the employer and the employees in the region is likely to be adverse, the appropriate Government may take that into account in deciding whether a reference should be made or not. ' ' We find that the approach made by the High Court was wrong and the reliance on the above passage on the facts of this case, is misplaced and unsupportable. This Court had made it clear in the same Judgment in the sentence preceding the passage quoted above that it was the province of the Industrial Tribunal to decide the disputed questions of fact. ". Similarly, on disputed questions of fact, the appropriate Government cannot purport to reach final conclusions, for that again would be the province of the Industrial Tribunal. " Therefore, while conceding a very limited jurisdiction to the State Government to examine patent frivolousness of the demands, it is to be understood as a rule, that adjudication of demands made 1026 by workmen should be left to the Tribunal to decide. Section 10 permits appropriate Government to determine whether dispute 'exists or is apprehended ' and then refer it for adjudication on merits. The demarcated functions are (1) reference, (2) adjudication when a reference is rejected on the specious plea that the Government cannot bear the additional burden, it constitutes adjudication and thereby usurpation of the power of a quasi judicial Tribunal by an administrative authority namely the Appropriate Government. In our opinion, the reasons given by the State Government to decline reference are beyond the powers of the Government under the relevant sections of the Industrial Disputes Act. What the State Government has done in this case is not a prima facie examination of the merits of the question involved. To say that granting of dearness allowance equal to that of the employees of the Central Government would cost additional financial burden on the Government is to make a unilateral decision without necessary evidence and without giving an opportunity to the workmen to rebut this conclusion. This virtually amounts to a final adjudication of the demand itself. The demand can never be characterised as either preverse or frivolous. The conclusion so arrived at robs the employees of an opportunity to place evidence before the Tribunal and to substantiate the reasonableness of the demand. Same is the case with the conclusion arrived at by the High Court accepting the stand of the State Government that the employees were not entitled to the Chambal allowance as the same was included in the consolidated pay. This question, in fact, relates to the conditions of service of the employees. What exactly are the conditions of service of the employees and in what manner their conditions of service could be improved are matters which are the special preserve of the appropriate Tribunals to be decided in adjudicatory processes and are not ones to be decided by the Government on a prima facie examination of the demand. This demand again can never be said to be either perverse or frivolous. There may be exceptional cases in which the State Government may, on a proper examination of the demand, come to a conclusion that the demands are either perverse or frivolous and do not merit a reference. Government should be very slow to attempt an examination of the demand with a view to decline reference and Courts will always be vigilant whenever the Government attempts to usurp the powers of the Tribunal for adjudication of valid dis 1027 putes. To allow the Government to do so would be to render A Section 10 and Section 12(5) of the Industrial Disputes Act nugatory. We have no hesitation to hold that in this case, the Government had exceeded its jurisdiction in refusing to refer the dispute to the Tribunal by making its own assessment unilaterally of the reasonableness of the demands on merits. The High Court erred in accepting the plea of the Government that refusal to refer the demands in this case was justified. The demands raised in this case have necessarily to be decided by the appropriate Tribunal on merits. In the result, we set aside the Judgment of the High Court, allow this appeal and direct the State Government to refer all the questions raised by the appellant to the appropriate Tribunal. The appeal is allowed with costs to the appellant quantified at Rs.2,500 n S.R. Appeal allowed.

The appellant is a trade union registered under the Trade Unions Act. It represents employees in the Chambal Project of Government of Madhya Pradesh in Gwalior Division. The union raised three demands, namely, (1) Chambal allowance; (2) Dearness allowance equal to that of the Central Government employees; and (3) Wages for the period of strike lasting 20 days in the year 1966 and served notices of these demands on the Deputy Chief Engineer, Major Project Chambal Since the attempts for settlement by the canciliation officer failed, a full report of the dispute under section 12 (4) of the Act was sent to the State Government which, by its order dated 15. 3. 1969, refused to refer the matter to the concerned Tribunal. The appellant took the matter before the High Court by filing Miscellaneous Petition No 29169 for a mandamus to the State Government to refer the matter for adjudication. The High Court allowed the writ petition, and directed the State Government to consider the question whether a reference was necessary or not. The Government again refused to refer the dispute to the Tribunal, taking the stand that the provisions of the Industrial Disputes Act were not applicable to the workmen in the Chambal Scheme as it was not Industry '. The appellant approached the High Court for the second time by filing Miscellaneous Petition No. 45 of 1970 and challenged the said orders. The High Court allowed the petition and directed the Government to take suitable action under section 12 (5) of the Act. The Government challenged the said decision before the Supreme Court by filing SLP No. 933 of 1972 without success. Later, by its order dated 13. 1. 72, the State Government referred to the Tribunal only the third question of payment of wages for the strike period and declined to refer the other two questions for the reasons that (a) the Government was not in a position to bear the additional burden and (b) the grant of the special allowance claimed would invite similar demands by other employees which would affect the entire administration. The appellant was perforced 1020 to approach the High Court, for the third time, by way of a miscellaneous Petition No. 127 of 1972 for a direction to the State to refer the other two demands also. In the meanwhile, the Supreme Court by its decision dated July 20, 1978 confirmed the High Court 's order that Chambal Project was a 'industry ' within the meaning of the Act. whereupon the Government reviewed the matter and passed an order on 3. 79 giving additional reasons for declining to refer the dispute for adjudication namely, (a) the State Government was not in a position and therefore cannot pay Central DA to any of its employees in any department and (b) the work charged employees who get a consolidated salary are not entitled to Chambal allowance under the rules. The High Court, by its decision dated 8th August 1980 dismissed the petition holding that the reasons given by the Court are germane and relevant. Hence the appeal by special leave. Allowing the appeal, the Court, ^ HELD: 1.1 The reasons given by the State Government to decline reference are beyond the powers of the Government under the relevant sections of the Industrial Disputes Act. [1026C] 1.2 While conceding a very limited jurisdiction to the State Government to examine patent frivolousness of the demands, it is to be understood as a rule, that adjudication of demands made by workmen should be left to the Tribunal to decide. Section 10 permits appropriate Government to determine whether dispute 'exists or is apprehended" and then refer it for adjudication on merits. The demarcated functions are (1) reference, (2) adjudication. [1025H; 1026A] 1.3 When a reference is rejected on the specious plea that the Government cannot bear the additional burden, it constitutes adjudication and thereby usurpation of the power of a quasi judicial Tribunal by an administrative authority namely the Appropriate Government. What the State Government had done in this case is not a prima facie examination of the merits of the question involved. To say that granting of dearness allowance equal to that of the employees of the Central Government would cost additional financial burden on the government is to make a unilateral decision without necessary evidence and without giving an opportunity to the workmen to rebut this conclusion. This virtually amounts to a final adjudication of the demand itself. The demand can never be characterized as other perverse or frivolous. The conclusion so arrived at robs the & employees of an opportunity to place evidence before the Tribunal and to substantiate the reasonableness of the demand. [1026B E] 1.4 What exactly are the conditions of service of the employees and in what manner their conditions of service could be improved are matters which are the special preserve of the appropriate Tribunals to be decided in adjudicatory processes and are not once to be decided by the Government on a prima facie examination of the demand. The question whether the emp 1021 loyees were/were not entitled to the Chambal allowance as they are in A receipt of a consolidated pay relates to the conditions of service of the employees Further this demand also cannot be said to be either perverse or frivolous. [1026F G] 1.5 However, there may be exceptional cases in which the State Government, may, on a proper examination of the demand, come to a conclusion that the demands are either perverse or frivolous and do not merit a reference. Government should be very slow to attempt an examination of the demand with a view to decline reference and Courts will always be vigilant whenever the Government attempts to usurp the powers of the Tribunal for adjudication of valid disputes. To allow the Government to do so would be to render section 10 and section 12 (5) of the Industrial Disputes Act nugatory. [1026G H; 1027A] C Bombay Union of Journalists vs State of Bombay ; , explained and followed.

(C) No. 655 of 1991. (Under Article 32 of the Constitution of India). Santosh Kumar Rungta and R.P. Gupta for the Petitioner. V.C. Mahajan, Ms. Niranjana Singh and Ms. A. Subhashini for the Respondents. The Judgment of he Court was delivered by KULDIP SINGH, J. National Federation of Blind a representative body of visually handicapped persons in India has filed this petition under Article 32 of the Constitution of India seeking a writ in the nature of mandamus directing the Union of India and the Union Public Service Commission to permit the blind candidates to compete for the Indian Administrative Service and the Allied Services and further to provide them the facility of writing and civil services examination either in Braille script or with the help of a Scribe. Braille is a system of writing for the blind in which the characters consist of raised dots to be read by the fingers. Further relief sought in the petition is that Group A and B posts in Government and public sector undertakings which have already been identified for the visually handicapped persons be offered to them on preferential basis. The visually handicapped constitute a significant section of our society and as such it is necessary to encourage their participation in every walk of life. The Ministry of Welfare, Government of India has been undertaking various measures to utilise the potentialities of the visually handicapped persons. The Central as well as the State Governments have launched several schemes to educate, train and provide useful employment to the handicapped. The Central Government has provided reservations to the extent of 3% vacancies in Group C and D posts for the physically handicapped including blind and partially blind. There has been a growing demand from the visually handicapped persons to provide reservations for them in Group A and B posts under the Central Government. The Ministry of Welfare, Government of India has a standing Committee or identification of jobs in various Mini stries/Departments and public sector undertakings for the physically hand 559 icapped. By an order dated December 30, 1985 the Government of India directed the Standing Committee to undertake the identification of jobs for the handicapped in Group A and B Services under the Government and public sector undertakings. The Committee submitted its report which was published on October 31, 1986. Copy of the report has been placed on the record of this petition. In the introduction to the report given by Mr. M.C. Narsimhan, Joint Secretary to Government of India and Chairman, Stating committee on identification of jobs for handicapped, it has been stated as under: "A Sub Committee, which was set up to assist the Standing Committee visited a large number of Public Sector Undertakings and observed people actually working in a variety of jobs and the working conditions in which these jobs are performed. The Sub Committee had detailed discussions with the Chiefs and Senior Officers of the Public Sector Undertakings as also with officers of the Central Government Departments. A fist of the public sector undertakings and the list of the officers of the Undertakings with whom the Sub Committee had discussions is annexed to the report. The Committee after detailed discussions and on the spot study has prepared a comprehensive list of 416 categories in Group A and B posts in Government Offices and Public Sector Undertakings, with their jobs descriptions, the physical requirement of each group of job and matched them with various categories of disabilities. " The Committee devoted special attention to the visually handicapped. Para 8 of the report which relates to the blind is as under: "However, in the case of the blind the position is somewhat different. Seeing, reading, writing and movement are essential ingredients of most Government jobs. Therefore, a similar approach in respect of blind persons may be difficult. It would not be possible to generalise that blind person can do most jobs as we have found for those with locomotor and hearing disabilities. The Committee found 560 that in higher posts is Government the help of a personal assistant or a stenographer is generally available. But this facility is. not available even in higher posts in public sector undertakings. Wherever this facility is available a blind person may not find it difficult, in certain groups of posts, to handle the job. It is also possible, in relation to other posts where stenographic assistance is not available that some other facilities can be provided to a blind employee. To compensate 'reading deficiency, readers ' allowance can be provided to blind employees to enable them to engage a reader. Similarly, to compensate for "writing deficiency", the blind employee should be required to know typing. Adequate knowledge of typing should be prescribed as an essential qualification for blind employees for public employment. Where mobility may also be one of the main ingredients of a job it is difficult to compensate blind employees for this "deficiency. The Committee would also emphasise that the blind employee should be fully responsible for the duties assigned to them, despite the provision of reader 's allowance and typing skill. The Committee would also suggest that the maximum reader 's allowance should be limited to Rs.200 p.m. to blind employees recruited to Group A and B post. ' The Committee has identified about 416 categories of Group A and B posts which are suitable for the handicapped. The Committee has further specified that the visually handicapped (blind and partially blind) are suitable for appointment to the following categories of Group A and B post: No. in the List Category of Group Annexed to the Post Report 178 to 187 Hindi officers A & B 191 to 192 Job Analyst A & B 193 to 199 Labour Welfare Officers A & B 200 to 209 Law Officers A & B 561 237 to 242 Personal Assistants B 243 to 256 Personnel Officers A & B 279 to 291 Public Relations Officers A & B 295 to 317 Research Officers A & B 354 to 363 Training Officers A & B 364 to 376 Administrative Officer (Non Secretarial) A 377 to 384 Administrative Officers (Secretarial Sr.) A 385 to 401 Administrative Officers (Secretarial Junior) A & B 409 Asstt. Admin. Officer We have only quoted the list of categories from the report to illustrate the point that the Committee appointed by the Government has in its report identified certain categories of posts to which the blind and the partially blind can be appointed. Government of India Through Ministry of Personnel issued office memorandum dated November 25, 1986 wherein it accepted the report of the Committee and took a policy decision that in respect of the posts identified by the Committee the handicapped persons shall be given preference in the matter of recruitment to those posts. The office memorandum is re produced hereunder: "No. F.36034/4/86 Estt.(SCT) Government of India Ministry of Personnel, Public Grievances & Pensions Department of Personnel & Training . . . New Delhi, the 25th November, 1986 OFFICE MEMORANDUM Subject: Identification of jobs for the physically handicapped persons in Groups 'A ' and 'B ' posts filled by direct recruitment in the Central Government services and Public Sector Undertakings. 562 The undersigned is directed to say that with a view to effecting optimum utilisation of potentialities of physically handicapped which constitutes a significant section of the population in the country, the Ministry of Welfare constituted a Standing Committee for identification of jobs for the physically handicapped in the Central Government services and Public Sector Undertakings. The Standing Committee on identification of jobs set up a sub Committee for on the spot identification of jobs for the physically handicapped persons in Group 'A and 'B ' posts after making an in depth study of Undertakings as well as in consultation with the concerned authorities. This subCommittee in its Report (submitted to the parent Committee) identified 420 jobs in Group 'A ' and Group posts/services alongwith the physical requirements and functional classifications of disabilities indicating what jobs can be held by each category of disabled people and with what disability. It has been decided that in respect of identified posts which can be held by physically handicapped persons preferences to physically handicapped persons will be ,given in the matter of recruitment to those posts. A copy of the report of the Committee referred to in para 1 is enclosed for information guidance and necessary action. The list of jobs identified by the Committee on suitable for being held by physically handicapped persons is not exhaustive. The Ministries/Departments can further supplement the list based on their knowledge for jobs requirements, essential qualifications etc. The Ministries/Departments after identifying all the posts which can be held by physically handicapped persons may inform the UPSC at the time of sending their requisitions for filling vacancies in respect of those posts, that preference is to be given to physically handicapped persons in the matter of recruitment. The UPSC have agreed in principle to give preference to physically handicapped persons in filling the identified posts. The Depart 563 ment of Personnel and Training will be issuing general instructions to enable preference being given to the physically handicapped persons in such cases. The Ministry of Finance etc. are requested to bring these instructions to the notice of all concerned. Sd/ (BATA K, DEY) DIRECTOR (JCA) ' From the office memorandum quoted above it is obvious that the Government of India has taken the following policy decisions to implement the Committee report: 1. The Government of India has taken cognizance of the fact that the Standing Committee on identification of jobs through its Sub Committee has identified 420 jobs in Group A and Group B posts/services along with the physical requirements and functional Classifications of disabilities indicating what jobs can be held by each category of disabled people and with what disability. The decision has been taken that in respect of identified posts which can be held by physically handicapped persons preference to physically handicapped persons will be given in the matter of recruitment to those posts. The list of jobs identified by the Committee is not exhaustive, the Ministries/Departments can further supplement the list based on their knowledge of job requirements, essential qualifications etc. The Ministries/Departments after identifying all the posts which can be held by physically handicapped persons may inform the Union Public Service Commission at the time of sending their requisitions for filling vacancies in respect of those posts, that preference is to be given to physically handicapped persons in the matter of recruitment. The Union Public Service Commission has agreed in principle to give preference to physically handicapped persons in filling identified posts. 564 6. The Department of Personnel and Training will be issuing general instructions to enable preference being given to the physically handicapped persons in such cases. Mr. S.K Rungta, learned counsel for the petitioner has contended that the memorandum dated November 25, 1986 was issued more than seven years back but so far the decisions taken therein have not been implemented. Mr. Rungta (himself visually handicapped) has argued his case with utmost clarity. Mr. Rungta was fully conversant with all the relevant annexures to the petition. He referred to the relevant pages in the bulky paper book with perfect ease. We did not feel even for a moment that the case was being argued by a visually handicapped lawyer. Mr. Rungta 's performance before us amply. proves the point that the visually handicapped persons can perform the jobs entrusted to them with equal efficiency. The question of giving preference to the handicapped in the matter of recruitment to the identified posts is a matter for the Government of India to decide. The matter is pending for decision with the Government of India for the last several years. While appreciating various measures undertaken by the Government to provide useful employment to the handicapped persons we commend the Government of India to decide the question of providing preference/reservation to the handicapped in Group A and B posts as expeditiously as possible. So far as the claim of visually handicapped for writing the civil services examinations, in Braille script or with the help of Scribe, is concerned, we are of the view that their demand is legally justified. The fist of category A and B posts, identified as suitable for the visually handicapped by the Committee, includes number of posts which are filled as a result of the civil services examinations. When there are posts to which blind and partially blind can be appointed, we see no ground to deprive them of their right to compete for those posts along with other candidates belonging to general category. Mr. V.K. Cherian, Under Secretary to Government of India, Ministry of Personnel in his affidavit dated March 10, 1992 filed before this Court has stated as under: 565 "If there were Group 'A ' and 'B ' jobs, which could be filled up by the blind, the same should also be identified. Once the jobs were identified, they could be filled up from among the blind and also other handicapped persons such as deaf and orthopaedically handicapped. Going by the Report of the Committee and the posts identified by it, the Union Public Service Commission made the observation that the posts identified as suitable to be held by the physically handicapped persons, particularly those iden tified for the blind are not such which are required to be filled on the basis of competitive examination conducted by the Commission '. The observations of the Union Public Service Commission as projected by Mr. V.K. Cherian in his above quoted affidavit do not seem to be correct. After going through the list of the posts identified as suitable for visually handicapped (blind and partially blind) it is obvious that there are number of posts which are required to be filled through the civil services examination and other competitive examinations conducted by the Commission. Group A and B posts in the category of Administrative Officers (Secretarial Senior) and Administrative Officer (Secretarial Junior) are necessarily to be filled as a result of civil services examination by the Union Public Service Commission. If some of the posts in the Indian Administrative Service and other Allied Services, as identified by the Committee, can be filled from amongst the visually handicapped persons then we see no reason why they should not be permitted to sit and write the civil services examination. We make it clear that once recruited to the lowest level of the service the visually handicapped persons shall not be entitled to claim promotion to the higher posts in the service irrespective of the physical requirements of the jobs. If in the hierarchy of promotional posts it is found by the Government that a particular post is not suitable for the visually handicapped person he shall not have any right to claim the said post. In the light of the above discussion we partly allow the writ petition and direct the Government of India and the Union Public Service Commission to permit the visually handicapped (blind and partially blind) eligible candidates to compete and write the civil services examination which is ordinarily held yearly by the Union Public Service Commission. 566 We further direct that they shall be permitted to write the examination in Braille script or with the help of a Scribe. There shall be no orders as to costs. S.P.S. Petition allowed partly.

The visually handicapped constitute a significant section of our society. As it is necessary to encourage their participation in every walk of life. The Central Ministry of Welfare has been undertaking various measures to utilise their potentialities. The Governments have launched schemes to educate, train and provide them with useful employment. The Central Government has provided 3% reservation in Group C and D posts for physically handicapped including blind and partially blind, while demand is growing for reservations in Group A and B posts. The Standing Committee of the Ministry of Welfare undertook identification of jobs in these categories and submitted its report on October 31, 1986. Para 8 thereof related to the blind. It took note of reading and writing deficiency and suggested the provision of allowance. And found that the specified 416 posts in Group A and B are suitable for blind and partially blind. So, the Ministry of Personnel issued office memorandum dated November 25, 1986 a accepting the report and took policy decision regarding identification of jobs for the physically handicapped persons in Group A and B posts filled to be by direct recruitment in Central Govern ment Services and Public Sector Undertakings. This court examined the memorandum and found that the Government had taken cognizance of the identified jobs; that the Government had 557 decided about the recruitment of handicapped lessons to these posts; that the departments would supplement the list further; that the Ministries/Departments would inform the UPSC about preferential treatment to handicapped candidates; that the UPSC had agreed in principle to give preference; and that the Department of Personnel and Training would be issuing general instructions for the purpose. However, the decisions were not implemented for seven years. So the petitioner approached this Court seeking a writ in the nature of mandamus directing the Union of India and the UPSC to permit the blind candidates to compete for the IA.S. and Allied Services and to provide them facility of writing the civil services examination either in Braille Script or with the help of a scribe. On hearing the counsel for the petitioner, himself visually handicapped, this Court, HELD: The performance of the counsel for the petitioner before us has amply proved the point that the visually handicapped persons can perform the jobs entrusted to them with equal efficiency. However the question of giving preference to the handicapped in the matter of recruitment to the identified posts is a matter for the Government of India to decide. The Government of India is commended to decide the question of providing preference/reservation to the handicapped in Group A and B Posts. [564 C D E] This Court further held that there are number of post which are required to be filled through the civil services examinations and other competitive examinations conducted by the Commission, so the observations of the UPSC that the posts identified as suitable to be held by the physically handicapped persons, particularly those identified for the blind were not required to be filled on the basis of competitive examination conducted by the Commission, appeared to be incorrect. [565 D] Group A and B posts in the category of Administrative Officers are necessarily to be filled as a result of civil services examination held by the UPSC. If some of the identified posts in the Indian Administrative Service and other Allied Services can be filled from amongst the visually handicapped persons, there was no reason why they should not be permitted to sit and write the civil services examination. [565 E] 558

l Appeals Nos. 1993 of 1968 and 1173 of 1971. Appeals by certificate/special leave from the judgment and order dated August 3, 4, 1967 of the Gujarat High Court in Income tax Reference No. 18 of 1966. section T. Desai, R. N. Sachthey and B. D. Sharma, for the appellant (in both the appeals). V.S. Desai, K. L. Hathi and P. C. Kapur, for the respondent (in both the appeals). The Judgment of the Court was delivered by Grover, J. This is ,in appeal from a judgment of the Gujarat High Court. Originally an appeal (C.A. 1993/68) had 952 been brought by certificate but that certificate was found to be defective as no reasons were stated therein for granting it. A Petition for special leave, was, therefore, filed and the same has been granted. Both the appeals shall stand disposed of by this judgment. The assessee is a registered firm and carried on the business of commission agency and general merchants. It also does forward business. It is a member of the Saurashtra Oil and Oilseeds Association Ltd., Rajkot. During the assessment year 1958 59 the corresponding accounting period being the samvat year 2013 the assessee claimed to have incurred a loss of Rs. 3 40,443/ in certain transactions entered into with different people for the supply of groundnut oil. The transactions, according to the assessee, were non transferable ready delivery contracts entered into with non members of the Association. It was expected that these contracts would be performed but owing to certain reasons some of the contracts could not be performed and differences had to be paid. According to the assessee it had acted as a Pucca Artia. The assessee claimed that the aforesaid loss was allowable under section 10(1) of the Income Tax Act, 1922 as a deduction against its other business income. The Income tax Officer came to the conclusion that the transactions in question were hit by the provisions of the Forward Contracts Regulation Act, 1952, hereinafter called the 'Act ' and the Rules and Regulations of the Saurashtra Oil and Oilseeds Association Ltd. In particular the transactions were hit by the provisions of sub sections (1) and (4) of section 15 of the Act and were not saved by section 18. The losses were held to have been incurred in illegal transactions. He rejected the contention of the assessee that even on the assumption that the losses were incurred in illegal transactions they could be allowed in the computation of the income. The Income tax Officer further held that the losses incurred in illegal business could not be deducted from the speculative profits under section 24 of the Indian Income tax Act, 1922, hereinafter called the "Act of 1922". The Appellate Assistant Commissioner confirmed the order of the Income tax Officer. In the appeal before the Tribunal it was held that the transactions in question were not illegal contracts but were contracts which had been, validly entered into under the Act and the bye laws etc. The Tribunal thereafter proceeded to examine the question whether the losses incurred could be allowed on the assumption that the transactions were illegal. It was of the view that the assessee would be entitled to a set off under section 24 even if the losses were incurred in illegal transactions. The Tribunal remanded the matter for a report from the Appellate Assistant Commissioner as to the applicability of the proviso to section 24(1) (read with the Explanation) of the Act of 1922. After the remand report was received the Tribunal gave the following two findings : (1) the contracts under consideration were all 953 non transferable specific delivery contracts where the intention ab initio was either to give or take delivery (2) the contracts were entered into either for the purchase or sale and later on the same quantity was either sold or purchased back by the assessee on behalf of the same constituents at the market rates prevailing at the material time i.e. they were squared up by corresponding sales or purchases as the case might be. After referring to certain decisions of High Courts the Tribunal held that the loss of Rs. 3,40,443 had been incurred in speculative transactions. The Tribunal next proceeded to consider whether notwithstanding that the losses had been incurred in speculative transactions the assessee could set off those against the other income under section 10(1) of the Act of 1922. Purporting to follow the view of the majority of the High Courts, the Tribunal held that such a loss could not be set off against the other income. But according to the Tribunal the assessee was certainly entitled to set off the loss against the profits in speculative transactions and to that extent the contention of the assessee was accepted. Both the assessee and the Commissioner of Income tax moved the Tribunal for submitting a case and referring certain questions of law to the High Court. Thus in all the following four questions were referred by the Tribunal (1) Whether on the facts and in the circumstances of the case the contracts in respect of which the loss of Rs. 3,40,443 was claimed were illegal contracts and were not validly entered into under the Forward Contracts Regulation Act 1952 ? (2) Whether even assuming the transactions in which the loss of Rs. 3,40,443/ was incurred, were illegal transactions, the assessee would be entitled to the set off of the said loss ? (3) Whether on the facts and in the circumstances of the case the transactions resulting in a loss of Rs. 3,40,443 were speculative transactions for the purpose of section 24 of the Indian Income tax Act 1922 merely on the ground that The assesses had not performed the contracts by giving delivery and had paid damages in settlement of the obligations contracted for ? (4) Whether on the facts and in the circumstances of the case the assessee is entitled to set off the balance of the loss of Rs. 1,21,397/ against the assessee 's other income ?" The High Court did not consider that it was necessary to answer the first question. The answer to the second question was that 954 even though the disputed contracts were not validly entered into in accordance with the provisions of section 15(4) of the Act the loss ,of Rs. 3,40,443/ was liable to be taken into account in computing the business income, of the assessee under section IO of the Act of 1922 and the assessee was entitled to set it off against the profits fro other speculative transactions. The third question was answered in the affirmative with the result that the transactions resulting in the loss of Rs. 3,40,443/ were held to be speculative for the purpose of section 24 of the Act of 1922. The fourth question was answered in the negative and against the assessee. It is the Commissioner of Income tax alone who has appealed. So far as the first question is concerned we are unable to comprehend why the High Court did not decide it. A lot of debate took place before us on the question whether the contravention of section 15 (4) of the Act would render the contracts illegal. According to that provision no member of a recognised Association shall, in respect of any goods specified in the notification under sub section (1), enter into any contract on his own account with any person other than, a member of the recognised Association unless he has secured the, consent or authority of such person and disclosed in the note memorandum or agreement of sale or purchase that he has bought or sold the goods as the case may be on his own account. It is not necessary to refer to the proviso. It is common ground and has been admitted before us that there was a clear contravention of the provisions of section 15(4) so far as the transactions in question were concerned. According to section 20(e) any person who enters into any contract in contravention of the provisions of section 15(4) among other sections shall on conviction be punishable for the first offence with imprisonment which may extend to one year or with fine of not less than Rs. 1,000/ or with both. It is wholly incomprehensible how such a contract would not fall directly within the ambit of the first part of section 23 of the Indian Contract Act which deals with consideration or object of an agreement which is forbidden by law. Such consideration or object would be unlawful according to the provisions of that section and the agreement would consequently be 'void. The High Court did not decide the point whether the contracts which contravened the provisions of section 15(4) of the Act were illegal. It did not consider it material to decide whether the impugned contracts were illegal. In its opinion what was material was that the impugned contracts had been entered into unlawfully and the question was whether the loss sustained in the unlawful business could be taken into account in computing the business income of the assessee. We consider that the first question which was referred to the High Court stands concluded by the law laid down by this Court in Sunderlal & Son vs 955 Bharat Handicrafts (P) Ltd. (1) It was laid down that the prohibition imposed by section 15 (4) of the Act was not imposed in the interest of revenue. That provision was conceived in the larger interest of the public to protect them against the malpractices indulged in by members of recognised associations in respect of transactions in which their duties as agents came into conflict with their personal interest. Parliament had made a writing, evidencing or confirming the consent or authority of a non member, as a condition of the contract if the member has entered into a contract on his own account. So long as there was no writing as was contemplated by section 15 (4) or its proviso there was no enforceable contracts It is well settled that contracts which are prohibited by statute the prohibition being either express or implied would be illegal and unenforceable if they are entered into in contravention of the statute. Under the provisions of the Act there is not only an express prohibition (section, 15 (4) ) but punishment is also provided for contravention of that prohibition, (s ' 20). Such contracts could not possibly be regarded as having been validly entered into under the Act. The answer 'to the first question, therefore, should have been in the affirmative and against the assessee. Coming to the second question, the language thereof is some what ambiguous and the question was not framed properly. It appears that there were two aspects which had come up for consideration before the departmental authorities the Tribunal and the High Court. The first aspect related to the deduction of the loss of Rs. 3.40,443/ incurred in the aforesaid illegal transactions while computing the profits of the assessee 's speculative business under section 10(1). The other was the set off which can be allowed within the relevant parts of section 24 of the, Act of 1922. The High Court referred to various English decisions as also to Wheat croft 's Law of Income tax and Simon 's Income tax for supporting the 'View that even where a trade is illegal it would still be a trade within the meaning of income tax law and if any profits are derives from such trade they would be assessable to tax. The High Court did not accept the contention urged on behalf of the Revenue that although the profits from an, illegal I trade or business would be exigible to tax the losses from such business could not be taken Court observed "There is in principle no distinction between profits and losses of a business and if the profits of an illegal business are assessable to tax, equally the losses arising (1) ; 956 from illegal business must be held to be liable to be taken into account in computing the income of the assessee '. The High Court was not inclined to accede to the submission on behalf of the Revenue that the same principle would be applicable as has been applied in certain cases in which the question which came up for determination was whether an expenditure, incurred on an illegal activity would be deductible under section 10 (2) (xv) of the Act of 1922. One of such cases, is a decision of the Punjab High Court in Raj Woollen Industries vs Commissioner of Income tax, Simla(1). In that case the real question was whether a certain amount which was paid to achieve what was prohibited by law, viz., the export of wool without having the requisite export licence was an amount which the assessee was entitled to deduct under section 10 (2) (xv) of the Act of 1922. It was held that according to principle and authority such a deduction could not be claimed. It was also observed that such a deduction would not be permissible even under section 10(1). Following observations may be referred to : .lm15 "Profits had to be ascertained according to the accepted principles of commercial accountancy and if section 10(2) (xv) did not permit deduction of an item of expenditure which was laid out or expended for carrying on the business in contravention of the law, then such an outgoing though otherwise properly admissible, as set off against the gross receipts on the principles of commercial accountancy could not be taken into consideration in computing the profits". On the other hand according to the decision of a full bench of the, Allahabad High Court in Chandrika Prasad Ram Swarup vs Commissioner of Income tax, U.P. & C.P. (2) income assessable to tax is the actual income of an individual or a firm irrespective of the manner in which the income was derived. Legality or illegality of the transaction culminating in profits or losses, was, therefore, foreign to the scope of an inquiry into the income of an individual or a firm for the purpose of income tax. Now while section 10(1) of the Act of 1922 imposes a charge on the profits or gains of a business it does not provide how these profits are to be computed. Section 10(2) enumerates various items which are admissible as deductions. They are, however, not exhaustive of all allowances which can be made in ascertaining the profits of a business taxable under section 10(1). It is undoubtedly true that profits and gains which are liable to be taxed under (1) (2) 957 s.10(1) are what are understood to be such under ordinary commercial principles. The loss for which the deduction is claimed must be one that springs directly from the carrying on of the business and is incidental to it. If this is established the deduction must be allowed provided that there is no provision against it express or implied in the Act : (See Badridas Daga V. Commissioner of Income tax(1). In that case loss sustained by the business by reason of embezzlement by an employee was held to be an admissible deduction under section 10(1) although it did not fall within section 10(2) (xi) of the Act of 1922. Indeed profits cannot be computed without deducting the loss and permissible expenses incurred for the purpose of the business. The approach of the high Court in the present case has been that in order to arrive at the figure of profits even of an illegal business the loss must be deducted if it has actually been incurred in the carrying on of that business. It is the net profit after deducting the out goings that can be brought to tax. It certainly seems to have been held and that view has not been shown to be incorrect that so far as the admissible deductions under section 10(2) are concerned they cannot be claimed by the, assessee if such expenses have been incurred in either payment of a penalty for infraction of law or the execution of some illegal activity. This, however, is based on the principle that an expenditure is not deductible unless it is a commercial loss in trade and a penalty imposed for breach of the law during the course of the trade cannot be described as such. Penalties which are incurred for infraction of the law is not a normal incident of business and they fall on the assessee in some character other than that of a trader; (See Haji Aziz & Abdul Shakoor Bros vs Commissioner of Income tax, Bombay City(2). In that case this Court said quite clearly that a disbursement is deductible only if it falls within section 10(2) (xv) of the Act of 1922 and a penalty cannot be regarded as an expenditure wholly and exclusively laid for the purpose of the business. Moreover disbursement or expense of a trader 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 comes upon him abextra" (Finlay J., in Allen vs Farquharson Brothers & Co.) (3). If the 'business is illegal neither the profits earned nor the losses incur red would be enforceable in law. But that does not take the profits. out of the taxing statute. Similarly the taint of illegality of the business cannot detract from the losses being taken into account for computation of the amount which can be subjected to tax as "profits" under section 1 0 ( 1 ) of the Act of (1)34 I.T.R. 10. (3) (2) 958 1922. The tax collector cannot be heard to say that he will bring the gross receipts to tax. He can only tax profits of a trade or business. That cannot be done without deducting the losses and the legitimate expenses of the business. We concur in the view of the High Court that for the purpose of s.10(1) the losses which have actually been incurred in carrying on a particular illegal business must be deducted before the true figure relating to profits which have to be brought to tax can be computed or determined. This will, however, not conclude the answer to question No. 2 because it seems to have been framed with the other aspect relating to "set off" under s.24 of the Act. The High Court found that the transactions were of a speculative nature. It was thus held that the loss of Rs. 3,40,443/ sustained in the impugned contracts was liable to be set off against ,the profit of Rs. 2,19,046/ which was admittedly a profit from speculative, transactions. The concluding portion of the judgment of the High Court may be reproduced because to Our mind it creates a certain amount of difficulty. "The loss of Rs. 3,40,443/ sustained in the impugned contracts was, therefore, liable to be set off only against the profit of Rs. 2,19,046/ which was admittedly profit from speculative transactions and the balance of Rs. 1,21,397/ after such set off was not liable to be set off against the other income of the assessee in view of the first proviso to section 24(1). We may make it clear that in taking this view we have proceeded upon the basis (that the impugned contracts which resulted in the loss of Rs. 3,40,443 constituted a separate business distinct from the business of forward contracts resulting in the profit of Rs. 2,19,046/ . The result would, however, be the same even if the impugned contracts which resulted in the loss of Rs. 3,40,443/ did not constitute a separate business but were part of the same business of forward contracts which resulted in the profit of Rs. 2,19,046/ for in that event the loss of Rs. 3,40,443 would be liable to be taken into account in determining the profits from such business under section 10". Section 24, to the extent it is material for our purposes, is set out below : "Set off of loss in computing aggregate income (1)Where any assessee sustains a loss of profits or gains in any year under any of the heads mentioned in section 6, he shall be entitled to have the amount of the 959 loss set off against his income, profits or gains under any other head in that year Provided that in computing the profits and gains. chargeable under the head "profits and gains of business, profession or vocation" any loss sustained in speculative transactions which are in the nature of a business shall not be taken into account except to the extent of the amount of profits and gains, if any, in any other business consisting of speculative transactions; Explanation 1. Where the speculative transactions carried on are of such a nature as to constitute a business, the business shall be deemed to be distinct and separate from any other business. Explanation 2. A speculative transaction means a, transaction in which a contract for purchase and sale of any commodity including stocks and shares is periodically or ultimately settled otherwise than by actual delivery or. transfer of the commodity or scripts;" In order to claim the set off the meaning of the speculative transaction has to be first looked at. Under Explanation 2 such a transaction means a transaction in which a contract for the purchase and sale of any commodity is periodically or ultimately settled otherwise than by actual delivery etc. Now the contract has to be an enforceable contract and not an unenforceable one by reason of any taint of illegality resulting in its invalidity. It has already been found by us that the contracts in question were illegal and unenforceable on account of contravention of section 15(4) of the Act. The High Court was in error in considering that any set off could be allowed in the present case under the first proviso to section 24(1) which must be read with Explanation 2. There would have been no difficulty in disposing of the matter finally after the above discussion. But enough attention was not devoted to the business which the assessee was doing and in which the profit of Rs. 2,19,046 was made and the loss of Rs. 3,40,443 was sustained. It has been found to be of a speculative nature but the High Court has not clearly found that it was the same business in which the amount of the profit and the loss mentioned above was earned and sustained in which case alone a deduction will be possible of the loss under section 10(1). The High Court proceeded on the basis that if the business in which the profit was made and the business in which the loss was incurred were separate a set off could be claimed by the assessee under section 24(1). If, however, the business was the same then the loss would be liable to be taken 960 into account while computing the profits under s.10(1). As we have come to the conclusion that no set off could be allowed under section 24(1) of the Act of 1922 it will have to be determined whether the profits and losses were incurred in ' the same business even though that business involved the entering into contracts some of which were, in the eye of the law, illegal. If the trade or the business, for instance, the business of commission agency or forward business was the same in which the profits were made and the loss was incurred then in order to arrive at the figure which can be subjected to tax the loss will have to be deducted from the profit. For this purpose we shall have to remit the matter to the High Court to decide this point and if necessary, after calling for a supplementary statement of the case. In the result our answer to the first question is that the contracts were illegal. on the third and the fourth questions there is no dispute nor has any appeal been preferred by the assessee relating to them that the answers returned by the High Court in the affirmative and in the negative respectively were not correctly answered. As regards question No. 2 the High Court will have to answer the same in the light of our judgment. Th. , appeal by special leave (i.e. C.A. 1173/71) shall stand disposed of accordingly and the other appeal by certificate (i.e. C.A. 1993/68) is hereby dismissed. There will be no order as to costs. V.P.S. Appeal partly allowed.

Section 15(4) of the Forward Contracts (Regulation) Act, 1952 is conceived in the larger interest of the public to protect them against the malpractices indulged in by members of recognised associations in respect of transactions in which their duties as agents come into conflict with their personal interest. Parliament had made a writing, evidencing or confirming the consent or authority of a non member, as a condition of the contract if the member has entered into a contract on his own account. So long as there was no such writing there was no enforceable contract. Under the Act, there is not only an express prohibition but also punishment for contravention of that prohibition. The assessee, a registered firm, was a member of the Saurashtra Oil and Oilseeds Association, and was carrying on the business of commission agency and general merchants. It was also doing forward business. During the assessment year 1958 59 it incurred a loss in certain transactions. Those transactions were in contravention of the provisions of section 15(4) of the Forward Contracts (Regulation) Act. The assessee claimed that the loss was allowable under section 10(1) of the Income tax Act, 1922, as a deduction against its other business income even if the losses were incurred in illegal transactions. The Income tax Officer rejected the contention of the assessee, and also held that the losses incurred in illegal business could not be deducted from speculative profits under section 24 of the Income tax Act. The Appellate Assistant Commissioner confirmed the order. The Tribunal held that the assessee could not set off the loss against the other income under section 10(1) of the Income tax Act but was entitled to do so under section 24. On the questions referred to the High Court namely : (1) Whether the loss was in respect of illegal contracts, (2) Whether the loss was a result of speculative transactions and therefore could be set off under section 24 of the Income tax Act, and (3) whether even if the loss was as a result of illegal transactions the assessee was entitled to set off the loss under section 10(1) of the Income tax Act, the High Court did not answer the first question but held that the losses could be set off both under section 10 and section 24 of the Income tax Act. In appeal to this Court, HELD:(1) It is well settled that contracts which are prohibited by statute, the prohibition being either express or implied, would be illegal and unenforceable if they are entered into in contravention of the statute. Therefore, the contracts in the present case, were illegal contracts and the loss was in respect of such illegal contracts. [955 C D] Sunder Lal vs Bharat Handicrafts ; , followed. 951 (2)Under Explanation 2 of section 24 a speculative transaction means a transaction in which a contract for purchase and sale of any commodity is periodically or ultimately settled otherwise than by actual delivery etc.; but the contract has to be an enforceable contract and not an unenforceable one by reason of any taint or illegality. In the present case, the contracts were illegal and unenforceable on account of the contravention of section 15(4) of the Forward Contracts (Regulation) Act. The High Court was therefore in error in considering that set off could be allowed under section 24(1) of the Income tax Act. [959 D F] (3)While section 10(1) of the Income tax Act imposes a charge on profits or gains of a business it does not provide how those profits are to be computed. Section 10(2) enumerates various items which are admissible as deductions but they are not exhaustive. The profits and gains which are liable to tax under section 10(1) are what are understood to be such under ordinary commercial practice. The loss for which the deduction is claimed must be one that springs directly from the carrying on of the business and is incidental to it, that is, the profit was earned and the loss was sustained in the same business. If this is established the deduction must be allowed provided that there is no provision against it. If the business is illegal, neither the profits earned nor the losses incurred would be enforceable in law but that does not take the profits out of the taxing statute. Simi larly, the taint of illegality of the business cannot detract from the loss being taken into account for computation of the amount which can BE subjected to tax as profits. Cases which deal with payment of a penalty for infraction of law or the execution of some illegal activity stand on a different footing, because, an expenditure is not deductible unless it is a commercial loss in trade and such a penalty cannot be described as such. [956 G H. 957 A B, D E, G H; 959 H; 960 A B] [Since in the present case no finding was given by the High Court that the two businesses in which profits were made and losses were sustained were the same, the matter was remanded to the High Court for decision on this point.] Raj Woollen Industries vs C.I.T., Simla, , Chandrika Prasad Ram Swarup vs C.I.T., U.P. & C.P., 7 I.T.R. 269, Badridas Daga vs Commissioner of Income tax, 34 I.T.R. 10, Haji Aziz & Abdul Shakhor Bros vs C.I.T., Bombay City, and Allen vs Fraquharson Bros. , referred to.

Appeals Nos. 401 to 403 of 1960. Appeals by special leave from the judgment and orders dated March: 1, 1960, of the Punjab High Court 601 (Circuit Bench) at Delhi in Civil Revision Cases Nos. 166 D, 167 D and 168 D of 1958. A. V. Viswanatha Sastri, section section Chadha and R. section Narula, for the appellants (in all the appeals). C. B. Aggarwala and B. Kishore, for the respondents (in C. A. No. 401 of 60). C. B. Aggarwala, R. M. Gupta and G. O. Mathur, for the respondents (In C. As. 402 & 403 of 60). September 8. The Judgment of the Court was delivered by KAPUR J. These appeals are directed against three judgments and orders of the Punjab High Court in three Civil Revisions Nos. 166 D, 167 D and 168 D which were brought by the appellants against three of their tenants under section 35 of the Delhi & Ajmer Rent Control Act (XXXVIII of 1952), hereinafter termed the Act. The appellants in all the three appeals are the landlords and the respondents in the three appeals are three different tenants. The appellants filed three separate suits for the eviction of their three tenants under cl. (g) of proviso to section 13(1) of the Act on the ground that the premises were bona fide required for purposes of rebuilding. On February 27, 1953, the parties in all the three suits entered into a compromise in the following terms : "We have compromised the case with the plaintiff. A decree may be passed for Rs. 82/8/ on account of rent in suit and for ejectment in respect of the shop in suit in favour of the plaintiff against the defendants ' The defendants will vacate the shop by 4 3 53 and hand over possession to the plaintiff and the plaintiff will hand over its possession again (second time) to the defendants within six months from 4 3 53 after constructing it afresh. We shall pay such rent as this court will fix ". Thereupon the court passed the following order and a decree followed thereon: " In terms of the statements of the plaintiff., defendant and counsel for defendants a decree for Rs. 82/8/ on account of rent in suit be passed in favour 602 of the plaintiff against the defendants. Also decree for ejectment be passed in respect of the shop in suit in favour of the plaintiff against the defendants and that the defendants do give possession of the shop in suit by 4 3 53 to the plaintiff and that the plaintiff after constructing it afresh within six months from 4 3 53 give it to the defendants. From out of the money deposited, a sum of Rs. 82/8/ be paid to the plaintiff and the balance returned to the defendants. The defendants shall be responsible to pay the rent fixed by the court ". According to the decree the possession was to be given to the appellants on March 4, 1953, but it was actually delivered by the three respondents between March 7 and 15, 1953. On the completion of the building the three respondents filed three separate applications under section 15 of the Act for their being put into possession. These applications were filed on October 7, 1953. The High Court held that the compromise did not comprise any matter which was not the subject matter of the suit ; that the respondents could enforce the terms of the decree in the proceedings which they took, i. e., under section 15 of the Act; that time was not of the essence of the compromise and therefore of the decree and consequently in spite of the possession of the premises having been given by the respondents after the date specified in the decree, i. e., March 4, 1953, the respondents were entitled to enforce the decree by execution and apply for possession being restored to them ; at any rate they could apply for restitution under the inherent powers of the Court. Thus the High Court was of the opinion that though section 15(2) of the Act was not applicable to the proceedings they could be treated as Execution proceedings. Against this judgment and order the appellants have come in appeal to this court by special leave. Under section 13 of the Act the respondents are protected against eviction excepting for the reasons given in the proviso. The appellants had filed the original suits for eviction under section 13, proviso (g), which was as under 603 Section 13: " Notwithstanding anything to the contrary contained in any other law or any contract, no decree or order for the recovery of possession of any premises shall be passed by any court in favour of the landlord against any tenant including a tenant whose tenancy is terminated): Provided that nothing in this sub section shall apply to any suit or other proceeding for such recovery of possession if the Court is satisfied (g) that the premises are bona fide required by the landlord for the purpose of rebuilding the premises or for the replacement of the premises by any building or for the erection of other building and that such building or rebuilding cannot be carried out without the premises being vacated ; ". Thus when the suits were brought the provisions of the Act were invoked. The decrees passed were on the basis that the premises were required by the landlord for rebuilding which falls under section 13 and the decrees also incorporated the requirements of section 15 which provides: "The Court shall, when passing any decree or order on the grounds specified in clause (f) or clause (g) of the proviso to sub. section (1) of section 13 ascertain from the tenant whether he elects to be placed in occupation of the premises or part thereof from which he is to be evicted and if, the tenant so elects, shall record the fact of the election in the decree or order and specify therein the date on or before which he shall deliver possession so as to enable the landlord to commence the work of repairs or building or rebuilding, as the case may be. (2) If the tenant delivers possession on or before the date specified in the decree or order, the landlord shall, on the completion of the work of repairs or building or rebuilding place the tenant in occupation of the premises or part thereof. (3) If, after the tenant has delivered possession on or before the date specified in the decree or order the landlord fails to commence the work of repairs or building or rebuilding within one month of the specified date or fails to complete the work in a reasonable 604 time or having completed the work, fails to place the tenant in occupation of the premises in accordance with sub section (2), the Court may, on the application of the tenant made within one year from the specified date, order the landlord to place the tenant in occupation of the premises or part thereof on the original terms and conditions or to pay to such tenant such compensation as may be fixed by the Court". The compromise, the order and the decree provided (1) that the respondents will vacate their respective shops on March 4, 1953, and hand over possession to the appellants; (2) they elected to get back possession after rebuilding,which the appellants agreed to hand back on September 4, 1953; (3) the rent after such possession was to be determined by the court. It was contended on behalf of the appellants that the above facts taken with the circumstances that the decree was passed in a suit under section 13(1), proviso (g), show that this was an order passed and a decree made in accordance with the terms of section 15 of the Act. It is significant that the respondents themselves made the applications to the court under section 15 of the Act. For the respondents it was argued that the decree was not one under section 15 of the Act because the decree was based on a compromise whereby the parties fixed the date of delivery of possession to the appellants; fixed the date for completion of the rebuilding and agreed between themselves as to repossession by the respondents. It was submitted that although the time for giving delivery to the appellants was fixed in the compromise it was not of the essence of the contract. In our opinion the contentions raised by the appellants are well founded and the appellants must succeed. The suits for eviction were brought within the framework of the Act and were based on the provisions of section 13, proviso (g). No eviction would have been possible excepting when conditions laid down in section 13 were satisfied. The decrees which were passed were substantially in accordance with the provisions of section 15 of the Act and as was contended by the appellants they were decrees under which the premises had to be vacated by the respondents on a specified day. 605 Under that section they had the right to elect and did elect to get possession after rebuilding; this possession was to be given by the landlords to the tenants within a reasonable time and six months ' period was fixed by Consent between the parties and the rent, if the respondents were not put into possession on the same terms as before, was to be settled by court and that is what was done under the terms of the consent decree. The applications for being put into possession which were filed by the respondents were really under section 15(3) of the Act. As the respondents did not deli ver possession to the appellants on or before the dates specified in the decree the provisions of section 15 contained in sub section (3) of that Act were not available to them and they were ,not entitled to be put into possession as prayed by them. It was argued that the appellants had taken possession of the premises after the specified date without protest and had even accepted rent upto then and were therefore estopped from raising that defence. The appellants had conceded in the court,% below that plea could be raised in a suit if it was brought. In the view we have taken we think it unnecessary to express any opinion oil this point. The High Court was, in our opinion, in error in ordering possession to be, delivered to the respondents. The appeals must therefore be allowed and the judgments and orders of the High Court set aside. The appellants will have their costs in this Court. One set of hearing Costs. Appeal allowed.

Three separate suits for eviction by the appellant were brought against the three respondents within the framework of the Delhi & Ajmer Rent Control Act and were based on the provisions of section 13(g) for the bona fide requirements of rebuilding. Terms of compromise which were substantially in accordance with the provisions of section 15 of the Act were put in by the parties and decrees were passed in the suits, under which the premises had to be vacated by the respondents on a specified day, which condition the respondents failed to observe and actually handed over the possession of the premises in suit at a later date. On completion of the building the respondents filed an application under section 15 of the Act for their being put into possession. The High Court inter alia held that though section 15 of the Act was not applicable to the proceedings yet the respondents could impose the terms of the decree and the proceedings could be treated as execution proceedings for enforcing the said terms. The appellants challenged the judgments of the High Court and contended that on the facts of the case and the circumstances, the decrees in suit under section 13(1) proviso (d) shows that the order was passed and a decree made in accordance with the terms of section 15 of the Act and further it was significant that the respondents them selves had made the application to the Court under section 15 of the Act. The respondents submitted that the decree was not one under section 15 of the Act because the decree was based on a compromise and the time for giving possession was not. of the essence of the contract : Held, that as the tenant respondents did not deliver posses sion of the premises to the landlord appellant on or before the dates specified in the decree, the provisions of section 15 (3) of the Delhi and Ajmer Rent Control Act (38 of 1952) were not available to them and they were not entitled to be put in possession.

ivil Appeal No. 143 of 1951. Appeal by special leave from the judgment and decree dated 23rd March, 1950, of the High Court of Judicature at Patna (Reuben and Jamuar JJ.) in appeal from Original Decree No. 206 of 1946 arising out of a decree dated 31st January, 1946, of the Subordinate Judge at Patna in Title Suit No. 55/4 of 1943 45. Saiyid Murtaza Fazl Ali for the appellants. N.C. Chatterjee (A. N. Sinha, with him)for the respond ents Nos. 1 to 9. B.K. Saran for the respondents Nos. 11 to 16. April 14. The Judgment of the Court was deliv ered by CHANDRASEKHARA AIYAR J. This is an appeal by the defendants from a decree of the Patna High Court reversing a decree of the Subordinate Judge 's Court at Patna, and de creeing the plaintiffs ' suit for possession against the defendant first party who may be called for the sake of convenience as 'the Gopes '. The lands were khudkhasht lands, partly belonging to the plaintiffs first party and partly belonging to Mussammat Anaro Kuer, from whom the plaintiffs second and third par ties trace title. The ancestors of plaintiffs first party gave on 28 9 1899 an ijara with possession to one Lakhandeo Singh an ancestor of the defendant second party under Exhib it I (b) for a term 777 of six years from 1307 Fasli to 1312 Fasli for Rs. 540. The poshgi money was to be repaid in one lump sum at the end of Fasli 1312. If there was no redemption then the ijara was to continue in force till the money was repaid. Mussammat Anaro Kuer gave her share in ijara to the same Lakhandeo Singh orally on 10th June, 1905, for a period of three years for Rs. 542. Lakhandeo Singh, who is represented now by the defendant second party, made a settlement of the land thus got by him (8.26 acres or 13 bighas in all) with one Ram Lal Gope an ancestor of the defendant first party for a period of three years from Fasli 1315 to Fasli 1318. There was a patta in favour of the tenant and a kabuliyat in favour of the landlord. This was in 1908. The mortgage was redeemed in June 1942 by payment in proceedings under section 83 of the Transfer of Property Act, When the plaintiffs went to take possession, they were resisted by the Gopes (defendant first party), and after unsuccessful criminal proceedings, the plaintiffs filed the present suit. The Subordinate Judge dismissed it, holding that the Gopes were raiyats having acquired permanent occupancy rights in the lands as the result of the settlement by the mortgagee, Lakhandeo Singh. On appeal the High Court set aside this decision and gave the plaintiffs a decree for possession on the finding that the defendants were not raiyats and had no permanent rights of occupancy. This court granted to the defendants special leave to appeal. The suit was in the alternative for recovery of the value of the lands as compensation or damages from the defendant second party in case it was found that the defendant first party could not be ejected. The trial court decreed this alternative claim and awarded to the plaintiffs compensation at the rate of Rs. 200 per bigha. The defendant second party carried the matter in appeal to the High Court and succeeded. But we have nothing to do with this matter in the present appeal. At the trial, the plaintiffs alleged and maintained that the lands were their zirat lands within the meaning SUPREME 778 of section 116 of the Bihar Tenancy Act and that the defend ant first party could acquire no rights of occupancy in the same. The Subordinate Judge found against this contention and held that they were khud kasht or bakasht lands of the proprietor, in which rights of occupancy can be acquired He negatived the plea of the defendants that they were their ancestral raiyati lands. He also held that there was no collusion between the mortgagee Lakhandeo Singh and Ram Lal Gope in the matter of settlement of lands. It is on the basis of these findings which were accepted by both the parties that the hearing of the appeal proceeded before the High Court. It was held by the Privy Council in Bengal Indigo Company vs Roghobur Das(1) that "a zuripeshgi lease is not a mere contract for the cultivation of the land at a rent, but is a security to the tenant for the money advanced". They observed, speaking of the leases before them, that "the leases in question were not mere contracts for the cultiva tion of the land let; but that they were also intended to constitute, and did constitute, a real and valid security to the tenant for the principal sums which he had advanced, and interest thereon. The tenants ' possession under them was, in part at least, not that of cultivators only, but that of creditors operating repayment of the debt due to them, by means of their security. " These words apply to the ijara deed before us; its dominant intention was to provide a security for the loan advanced and not to bring into existence any relationship of landlord and ten ant. The general rule is that a person cannot by transfer or otherwise confer a better title on another than he himself has. A mortgagee cannot, therefore, create an interest in the mortgaged property which will enure beyond the termina tion of his interest as mortgagee. Further, the mortgagee, who takes possession of the mortgaged property, must manage it as a person of ordinary prudence would manage it if it were his own; and he must not commit any act which is de structive (1) 779 or permanently injurious to the property; see section 76, sub clauses (a) & (e)of the Transfer of Property Act. It follows that he may grant leases not extending beyond the period of the mortgage; any leases granted by him must come to an end at redemption. A mortgagee cannot during the subsistence of the mortgage act in a manner detrimental to the mortgagor 's interests such as by giving a lease which may enable the tenant to acquire permanent or occupancy rights in the land thereby defeating the mortgagor 's right to khas possession; it would be an act which would fall within the provisions of section 76, subclause (e), of the Transfer of Property Act. A permissible settlement by a mortgagee in possession with a tenant in the course of prudent management and the springing up of rights in the tenant conferred or created by statute based on the nature of the land and possession for the requisite period is a different matter altogether. It is an exception to the general rule. The tenant cannot be ejected by the mortgagor even after the redemption of the mortgage. He may become an occupancy raiyat in some cases and a non occupancy raiyat in other cases. But the settle ment of the tenant by the mortgagee must have been a bona fide one. This exception will not apply in a case where the terms of the mortgage prohibit the mortgagee from making any settlement of tenants on the land either expressly or by necessary implication. Where all the zamindari rights are given to the mortga gee, it may be possible to infer on the proper construction of the document that he can settle lands with tenants in the ordinary course of management and the tenants might acquire certain rights in the land in their capacity as tenants. In the case of Manjhil Lal Biswa Nath Shah Deo vs Shaikh Mo hiuddin(1), there was a bona fide settlement of mortgaged rayati land by the mortgagee with tenants and it was held that the mortgagor was not entitled to evict them after redemption. The earlier decision of Babu Bhairo Nath Ray vs Shanke Pahan(2), related to bakasht lands, and (1) (2) Pat.31. 780 there was no provision in the zuripeshgi lease restricting the power of the mortgagee lessee as regards settlement of tenants. Khudkasht lands and bakasht lands are really in the nature of raiyati lands which come into the possession of the proprietor by surrender, abandonment or purchase. In the present case. we have the following clause in the ijara deed: "It is desired that the ijaradar should enter into possession and occupation of the share let out in ijara (being the khudkasht land under his own cultivation), culti vate them, pay 2 annas as reserved rent year after year to us, the executants, and appropriate the produce thereof year after year on account of his having the ijaradari interest. " This term disentitles the mortgagee from locating tenants on the land mortgaged. Ram Lal Gope, the grandfather of the defendants first party, who executed the kabuliat in 1908 must have known of the title of Lakhandeo Singh the mortga gee and the terms under which he held the lands under the registered zuripeshgi ijara deed and this is most probably why the tenant not only took the lease for a period of 3 years, but expressly undertook to give up possession over the thika lands on the expiry of the period of lease without urging any claim on the score that the lands were his old kasht lands. His kabuliat (Exhibit 11) in fact refers to Lakhandeo Singh 's ijaradari interest. In view of these facts, the learned Judges of the High Court stated that they were not prepared to hold that the settlement was a bona fide one or the mortgagee was within his rights in settling these lands. Strong reliance was placed for the appellants on the Full Bench decision Binad Lal Pakrashi and Others vs Kalu Pramanik and Others (1) where it was held that a person inducted into possession of land as a raiyat even by a trespasser became a non occupancy raiyat within the meaning of section 5, sub section, 2 of the Bengal Tenancy Act and was protected from ejectment. But this decision has been subsequently (1) Cal. 781 explained away in several cases as based on the proposition that the rights must have been bona fide acquired by them from one whom they bona fide believed to ' have the right to let them into possession of the land. Such, however, is not the case here, in view of the recitals in the ijara deed in favour of Lakhandeo Singh and the kabuliat by Ram Lal Gope. Sections 20 and 21 of the Bihar Tenancy Act were re ferred to by the learned counsel for the appellants in the course of his arguments and he pointed out that the land in this case was held ' continuously by his clients and their predecessors from 1908 to 1942, when they were sought to be ejected. For these sections to apply, we must be in a position to hold that the appellants were "settled raiy ats". "Raiyals" is defined in sub clause 2 of section 5 as meaning "primarily a person who has acquired a right to hold land for the purpose of cultivating it by himself or by members of his family . " Sub clause 3 provides that a person shall not be deemed to be a raiyat unless he holds land either immediately under a proprietor or immediately under a tenure holder. Lakhandeo Singh was not a "proprie tor" by which term is meant a person owning, whether in trust or for his own benefit, an estate or part of an es tate: he was only a mortgagee. Nor was he a tenure holder or under tenureholder, as he does not comply with the defi nition given in sub clause (1) of section 5, namely, a person who had acquired from a proprietor or from another tenure holder a right to hold land for the purpose of col lecting rents, or for the purpose of bringing the land under cultivation by establishing tenants on it. Such proof as there is in this case only goes to show that the lands were under the cultivation of the plaintiffs and that they were made over to the possession of the mortgagee so that he might cultivate them himself. Hence, Ram Lal Gope could not claim that he was a settled raiyat of the village and that under the statute he secured occupancy rights in the lands Which he took on lease from Lakhandeo Singh. 782 Lastly, it was urged that the ijara by Mst. Anaro Kuer was admittedly an oral transaction and there was no proof of any prohibition against the settlement with tenants so far as her share (3.97 acres) was concerned and that the rights of the parties as regards this area would stand on a differ ent footing from the rights in respect of the 4 acres and 29 cents belonging to the plaintiff first party. This point was not taken in the courts below where the two ijaras given to Lakhandeo Singh were dealt with as if they were part and parcel of one and the same transaction, the rights and liabilities, whatever they were, being common to both. We cannot allow the point to be taken now. The result is that the High Court 's decree is con firmed and the appeal is dismissed with costs of the plain tiffs respondents. There will be no order as to costs of the other respondents. Appeal dismissed. Agent for the respondents Nos. 1 to 9: M.M. Sinha. Agent for the respondents Nos. 11 to 16: K.L. Mehta.

As a general rule a person cannot transfer or otherwise confer a better title on another than he himself has and a mortgagee cannot therefore create an interest in mortgaged property which will enure beyond the termination of his interest as mortgagee. Further, a mortgagee cannot during the subsistence of the mortgage act in a manner detri mental to the mortgagor 's interests, such as by giving a lease which may enable the tenant to acquire permanent occupancy rights in the land, thereby defeating the mortga gor 's right to khas possession. A permissible settlement by a mortgagee in possession with a tenant in the course of prudent management and the springing up of rights in the tenant conferred or created by statute based on the nature of the land and possession for the requisite period is an exception to the general rule, but to fall within this exception the settlement of the tenant by the mortgagee must have been a bona fide one. The exception will not apply in a case where the terms of the mortgage prohibit the mortgagee from making any settle ment of tenants on the land either expressly or by necessary implication. Where a zuripeshgi ijara deed contained the following clause: "It is desired that the ijaradars should enter into possession and occupation of the share let out in ijara (being the kkudkasht land under his own cultivation), culti vate them, pay 2 as. as reserved rent year after year to us, the executants, and appropriate the produce thereof year after year on account of his having the ijara interest" and the kabuliat executed by the tenant to whom the lands were leased by the mortgagee for a period of 3 years referred to the ijara deed and contained an express provision that he (the tenant) would give up possession of the tika land on the expiry of the lease without urging any claim on the score that the lands were his kasht lands: Held, confirming the decision of the High Court, that the settlement was not a bona fide one and the successors of the tenant (the de fendants) did not acquire permanent rights of occupancy in 101 776 the demised lands under the Bihar Tenancy Act even though the lands had been in the occupation of the tenant and his successors for over 30 years after the expiry of the lease. Held further, that the defendants could not acquire occupancy rights under sections 20 and 21 of the Bihar Tenancy Act as the mortgagee was neither a "proprietor" nor a "tenure holder" or "under tenure holder" and the tenant and his successors were not, therefore, "settled raiyats" within the meaning of section 5, cl. (2), of the said Act. Manjhil Lal Biswanath Shah Deo. vs Shaikh Mohiuddin (I.L.R. Babu Bairo Nath Ray vs Shanke Pahan (I.L.R. 8 Pat. 31) and Binda Lal Pakrashi and Others vs Kalu Pramanik and Others (I.L.R. distinguished.

Appeals Nos. 2253 and 2254 of 1966. Appeals from the judgment and decree dated July 5, 1965 of the Calcutta High Court in Appeals from Original Decrees Nos. 490 and 489 of 1960 respectively. Sarjoo Prasad and R. Ganapathy Iyer, for the appellant (in C. A. No. 2253 of 1966). Devaprasad Chaudhury and Sukumar Ghove, for the appellant (In C. A. No. 2254 of 1966). A.K. Sen, section K. Gambhir and D. N. Gupta, for the respon dents (in both the appeals). The Judgment of the Court was delivered by Bachawat, J. The respondents are limited companies having their head offices in Calcutta. On May 15, 1953, the two Companies jointly purchased the premises known as King 's Court ' at No. 46B Chowringhee Road, Calcutta, for the purpose of providing residential accommodation for their staff. They instituted a suit against one B. M. Lall, since deceased, predecessor of the appellants in C. A. No. 2253/66 for recovery of possession of flat No. 8 in the aforesaid premises in his occupation as a tenant, and another suit against the appellant in C. A. No. 2254/66 for recovery of possession of flat No. 9 in his occupation as a tenant, on the ground that they reasonably required the flats for the occupation of their staff. By Sec. 13(1) of the West Bengal Premises Tenancy Act, 1956, (West Bengal Act XII of 1956), the tenants are protected from eviction except on one or more of the grounds specified in the sub section. The grounds mentioned in clause (f) of section 13(1) are: "Where the premises are reasonably required by the landlord either for purposes of building or re building or for making thereto substantial additions or alterations or for his own occupation if he is the owner or for the occupation of any person for whose benefit the premises are held;". . The respondents claim that they reasonably require the flats for their own occupation. The trial court dismissed the suits. From these decrees, the respondents filed appeals in the High Court at Calcutta. The High Court set aside the decrees passed by the trial court and decreed the suits. The present appeals have been filed under certificates granted by the High Court. 25 The High Court held that (1) a limited company can be a landlord within the meaning of section 13(1)(f) and can reasonably require the premises for its own occupation, and (2) where there are several landlords, the requirement of the premises by the landlords for the occupation of one or more of them is sufficient to bring the case within Sec. 13(1)(f). These findings are not challenged in this Court. Before us it is also conceded by all the appearing parties that the respondents are entitled to a decree for recovery of possession of the two flats under sec. 13(1)(f), if they establish that they reasonably require the flats for the occupation of respondent No. 2, Guest Keen and Williams Ltd. only. The two courts concurrently found that respondent No. 2 reasonably requires the flats for the occupation of its staff. The Company is under an obligation to provide free residential accommodation for its officers in properties either rented or owned by it. In view of the acute scarcity of accommodation in the city, it is not possible to find other convenient flats for officers who were transferred to the city from other stations. Suitable provision for the accommodation of officers visiting Calcutta on tour is a matter of necessity. The sole question is whether the occupation by its staff officers would be the company 's own occupation. The point of dispute on which the two courts differed is whether the officer to whom the flat would be allotted would occupy it as a tenant or as a licensee. It is common case before us that if he is a licensee his occu pation would be on behalf of the company and its requirement would be for its own occupation. On the other hand, if he is a tenant his occupation would be on his own account and the company 's requirement would not be for its own occupation. It appears that the officers provided with accommodation by the Company are required to execute agreements in a standard form. The terms and conditions of the agreement are as follows: 1 . The Licensee whilst in the employment of the Company at Calcutta and for the sole purpose of the Licensee being more conveniently situated in such employment is hereby permitted by the Company to occupy as a Licensee during the term of his employment at Calcutta Flat No. 25, situated in the Company 's property known as Kings Court, Calcutta, or such other flat as may be allotted to the Licensee at the company 's discretion (hereinafter referred to as "the said permises") subject to the terms and conditions hereinafter contained. In the event of the Company deciding to levy License fees and the Company reserves the right to do so without prior notice, the Licensee shall pay to the Company each month such License fees which may be varied by the 'Company from time to time at its discretion and the Company shall be entitled to deduct such License fees from the emoluments or to become due to the Licensee from Company. The occupation of the said premises by the Licensee is a condition of his employment at Calcutta with the company and such right of occupation shall forthwith cease upon his employment being terminated by the company or on his leaving such employment or on his transfer away from Calcutta or on his death whichever is earlier. Notice given by the Company to the Licensee of termination of employment or of transfer away from Calcutta shall be deemed to be sufficient notice of revocation of the licence. The Company shall be entitled to determine forthwith the licence hereby granted if the licensee shall fail to comply with any of the terms and conditions herein contained and on his part to be observed and non compliance with the terms and conditions herein contained may be deemed by the company to be misconduct. These presents shall not or shall not be deemed to create any relationship of landlord and tenant between the company and the licensee in respect of the said premises. The company shall pay all present and future revenue and municipal taxes payable in respect of the said premises and keep the said premises in repair during the continuance of these presents. Conditions to be complied with by the licensee: 1. The Licensee shall pay the cost of electricity and gas consumed within the said premises and the company may at its discretion deduct such charges from the emoluments due or to become due to the Licensee from the company. The Licensee shall not cause or permit to be cause any disturbance or nuisance in or in the vicinity of the said premises. No structure or alteration temporary or permanent, other than common ornaments shall be erected, fixed or carried out by the Licensee in the said premises or garden without prior written permission from the company. The Licensee shall not do or permit to be done any act or thing which causes damage or is liable to cause damage to the said premises. The cost of rectification of such damage will be recoverable in accordance with condition (1). Alterations of or extensions to the installed electrical circuit are strictly prohibited. No notice advertisement or placard other than the Licensee 's own name, which may be fixed to the main door of the said premises, shall be fixed or permitted to be fixed to any portion of the said premises. The said premises shall be used entirely as a dwelling place and no business or trade shall be carried out on the said premises or any part thereof without prior written permission from the company. The Licensee will not permit any persons other than his own personal servants to occupy the servants ' quarters allotted to him by the company and will not permit the garage allotted to him by the company to be used for residential purpose. The Licensee shall not take in any paying guest without prior written permission from the company and such permission shall be deemed to have been withdrawn when the paying guest ceases to reside. The Licensee shall not let or part with possession of the whole or any part of the said premises to any person, firm or company. During periods when the Licensee is absent from Calcutta the Company may assign the premises to any other employee or suitable person at its sole discretion. The question is whether the occupier under this agreement is a tenant or a licensee. The distinction between a lease and a license is well known. 105 of the Transfer of Property Act defines a lease. 52 of the Indian Easements Act defines a license. A lease. is the transfer of a right to enjoy the premises; whereas a license is a privilege to do something on the premises which otherwise would be unlawful. If the agreement is in writ ing, it is a question of construction of the agreement having regard to its terms and where its language is ambiguous, having regard to its object, and the circumstances under which it was executed whether the rights of the occupier are those of a lessee or a licen see. The transaction is a lease, if it grants an interest in the land; it is a license if it gives a personal privilege with no interest in the land. The question is not of words but of substance and the label which the parties choose to put upon the transaction, though relevant, is not decisive. The test of exclusive possession is not decisive, see Errington vs Errington and Woods,(1) Associated Hotels of India Ltd. vs R. N. Kapoor,(2) though it is a very important indication in favour of tenancy. See Addiscombe Garden Estates Ltd. and Anr. vs Crabbe and Ors.(3). A servant in occupation of premises belonging to his master may be a tenant or a licensee, see Halsbury 's Laws of England, Third Edition, Vol. 23, article 990. p. 411. A service occupation is a particular kind of license whereby a servant is required to live in the premises for the better performance of his duties. Formerly, the occupation of the servant was regarded as a tenancy unless it was a service occu (1)[1952] 1 K.B. 290, 298. (2) [1260] 368, 381 5. (3) ,525. 28 pation, see Nippon Menkwa Kalmshiki vs F. Portlock(1). Now it is settled law that a servant may be a licensee though he may not be in service occupation. In Torbett vs Faulkner(2) Denning, L. J. said: "A service occupation is, in truth, only one form of licence. It is a particular kind of licence whereby a servant is required to live in the house in order the better to do his work. But it is now settled that there are other kinds of licence which a servant may have. A servant may in some circumstances be a. licensee even though he is not required to live in the house, but is only permitted to do so because of its convenience for his work see Ford vs Langford 1(1949) 65 The Times L.R. 1381, per Lord Justice Asquith, and Webb, Ltd. vs Webb (unreported, October 24, 1951) and even though he pays the rates, Gorham Contractors, Ltd. vs Field (unreported, March 26, 1952), and even though he has exclusive possession, Cobb vs Lane (1952) 1 The Times L.R. 1037)". The Lord Justice then continued: "If a servant is given a personal privilege to stay in a house for the greater convenience of his work, and it is treated as part and parcel of his remuneration, then he is a licensee, even though the value of the house is quan tified in money; but if he is given an interest in the land, separate and distinct from his contract of service, at a sum properly to be regarded as a, rent, then he is a tenant, and none the less a tenant because he is also a servant. The distinction depends on the truth of the relationship and not on the label which the parties choose to put upon it: see Facchini vs Bryson (1952 ) The Times L.R. 1386). " The last observation covers the present case. Under the standard form of agreement of respondent No. 2, the occupation of the officer ceases not only on the termination of his employment but also on his transfer from Calcutta and on his death. The company is at liberty to allot any other flat to the officer. During the absence of the servant from Calcutta, the company is at liberty to assign the premises to any other employee or other person. The accommodation is free, but the Company reserves the right to levy license fees. All the terms of the agreement are consistent with the expressed intention that the officer is permitted to occupy the flat as a licensee and nothing in the agreement shall be deemed to create the relationship of landlord and tenant. The agreement on its true construction read in the light of the surrounding circumstances operates as a license and not as a tenancy. It creates no interest in the land. It gives only a personal privilege or license (1)A.I.R. 1922 Botm. (2) [1952]2 T.L.R. 659,660, 29 of the servant to occupy the premises for the greater convenience of his work. The High Court rightly held that the respondents reasonably require the flats for respondent No. 2 's own occupation through officers holding the flats on its behalf as licensee. If so, it is conceded that it is not necessary for the respondents to establish the reasonable requirement by respondent No. 1 also for its own Occupation. The High Court decided this issue also in favour of the respondents. As the decision on this issue is not necessary for the disposal of this appeal, we express no opinion on it. The High Court rightly decreed the suits. In the result, the appeals are dismissed. There will be no order is to costs. R.K.P.S. Appeals dismissed.

The respondent limited companies purchased certain premises in Calcutta for the purpose of providing residential accommodation for their staff. They instituted suits against the appellants for the recovery of possession of two flats on the ground that as these flats were required for housing their officers, they were reasonably required for the occupation of the respondents within the meaning of section 13(1) (f) of the West Bengal Premises Tenancy Act, 1956. The Trial Court dismissed the suits but the High Court allowed an appeal and held that a limited company can be a landlord within the meaning of section 13(1) (f) and can reasonably require the premises for its own occupation; and that where there are several landlords, the requirement of the premises by the landlords for the occupation of one or more of them is sufficient to bring the case within section 13(1) (f). In the appeal before the Supreme Court the only question for determination was whether on the construction of the terms of an agreement which was normally signed between each of the respondents and any officer who was allotted a flat, the officer occupied the flat as a tenant or a licensee, and therefore whether the officer 's occupa tion would be the company 's own occupation within the meaning of clause (f). Held:Dismissing the appeal: The High Court nightly held that the respondent reasonably required the flats for the second respondent company 's own occupation through officers holding flats on its behalf as licensees. [29B] Under the standard form of agreement, the occupation of the officer ceased on the termination of his employment, upon his death, or on his transfer and the company was at liberty to allot him any other flat or to assign the premises to any other employee or other person during his absence. In view of these and its other terms the agreement operated as a license and not as a tenancy. It created no interest in the land and gave only a personal privilege or license to the servant to occupy the premises for the greater convenience of his work. [28F H] Under section 105 of the Transfer of Property Act, a lease is the transfer of a right to enjoy the premises whereas under section 52 of the Indian Easements Act a license is a privilege to do something on the premises which otherwise would be unlawful. The transaction is a lease if it grants an interest in the land; it is a license if it gives a personal privilege with no interest in the land. [27E F] Errington vs Errington and Woods, ; , 298: Associated Hotels of India Ltd. vs R. N. Kapoor. ; ; 3815. Addiscombe Garden Estates Ltd. and Anr, V. Crabe and Ors. , 525; referred to. 24 A service occupation is a particular kind of license whereby a servant is required to live in the premises for the better performance of his duties. Now it is also settled law that a servant may be a licensee though he may not be in service occupation. [27H] Nippon Menkwa Kalmshiki vs F. Portlock, A.1.R. ; and Torbett vs Faulkner, , 560; referred to.

: Criminal Appeal No 592/ 1976. (Appeal by Special Leave from the Judgment and Order dated 19.11.1975 of the Karnataka High Court in Crl. A. No. 551 of 1974. and Reference Case No. 56/74) R.B. Datar, for the appellant Narayan Nettar and R.C. Kaushik, for the respondent. The Judgement of the Court was delivered by GOSWAMI, J. The short question in this. appeal by spe cial leave is whether a person sentenced to imprisonment for life and later released by the Government by remission of the sentence under section 401, Criminal Procedure Code, 1898, continues to "being under sentence of imprisonment for life" fort the purpose of section. 303, Indian Penal Code. The appellant had earlier been convicted on July 26, 1961, by the High Court of Mysore under section 302 IPC and sentenced to. imprisonment for life in an appeal by the State against his acquittal. 395 The earlier murder was on December 3, 1959. The State Government in exercise of its power under section 401 Cr. P.C. conditionally remitted his sentence on Feburary 8, 1972. Thus he was conditionally released from jail on Febu rary 8, 1972. Tragically enough, on January 27, 1973, the appellant got himself involved in the present murder charge even before the expiry of the first year of his release. He was convicted under section 302 and section 303 IPC by the Sessions Judge, Kolar, on November 7, 1974 and sentenced to death under section 303 IPC. On an appeal to the High Court by the appellant which was heard along with the refer ence for confirmation, .the sentence of death under section 303 IPC was confirmed on November 19, 1976. Hence this appeal by special leave limited to the question of ap plicability of section 303 IPC and the sentence. The earlier sentence of imprisonment for life became final and inexorable so far as the judicial process was concerned. It is only when such a sentence is "operative and executable" that section 303 IPC is attracted. (See Dilip Kumar Sharrna & Ors. vs State of Madhya Pradesh (1). The remission of the sentence in this case is by the State of Karnataka in exercise of its statutory power under section 401 Cr. The power has been exercised, in the instant case, laying down certain conditions which the convict had accepted. The two conditions were that, during the unexpired period of his sentence conditionally remitted, (1 ) he will not commit any offence punishable by any law in Mysore and (2 ) he will not in any way associate with per sons known to. be of bad character or lead a dissolute or evil life. The portion of the remitted sentence, in this case, was a period of four years and four months after the appellant had undergone over years of his sentence including a little over five years ' remission earned by him in jail. In the normal course, in absence of the order of remission, the appellant would have been released from jail on June 1976. Shortly stated, was the appellant under sentence of impris onment for life on the date of occurrence of the second murder on January 27, 1973 ? If he was continuing to be under the sentence of imprisonment for life on that day the court cannot come to his rescue by exercising discretionary clemency in favour of the alternative sentence. Then the only sentence the court has power and is obliged to impose, and no other, is the sentence of death. That is the true effect of section 303 IPC. The fact that the accused is of the age of 73 years will be of no consequence once he is found guilty under section 303 IPC. The court will be helpless in such an event. The Sessions Judge as well as the High Court held that section 303 IPC was applicable as this was a case of condi tional remission under section 401 Cr. P.C. and the second murder was committed during the unexpired portion of the sentence of imprisonment for life. (1) ; 396 It is the correctness of the above view of the law that falls for consideration before us. That view receives support from the following decisions cited at the bar. The first decision is from the Rangoon High Court in Po Kun vs The King(1). It was held in that case that "if the sentence of transportation for life passed on a person is conditionally remitted by the Government under section 403 ? Criminal P.C., and the person is released, such person must still be deemed to be under, sentence of transportation for life in spite of the fact that he is not actually under sentence or in a penal settlement". 0 The next decision is from the Punjab High Court in Sohan Singh vs The State(2). It was held in that case that "it is not essential for the applica tion of the section (303 IPC) that a person should be actually undergoing the sentence of imprisonment for life when he commits murder". X X X X " . the effect of a conditional order of remission is not to altogether wipe out or efface the remitted portion of the sentence, but to. keep it in abeyance. As soon as there is breach of the conditions of the remission, the remission can be cancelled and the prisoner committed to custody to undergo the unexpired portion of the sentence. In the circumstances. the accused should be deemed to be under sentence of imprisonment for life when the present occurrence took place". Our attention was drawn to a decision Of the Sind Court in Ghularn Muhammad Wali Muhammad vs Emperor(3) which was a case of unconditional remission of the sentence under sec tion 401 Cr. It was held in that decision that since the Provincial Government had 'remitted the sentence without condition under section 401 Cr. P.C. the accused committing the second murder after the remission would no longer be said to be "under a sentence of transportation for life, that sentence having in effect been served". We are, however, clearly of opinion that for the purpose of section 303 IPC it does not make any difference whether the remission under section 401 Cr. P.C. with or without conditions. This: is clear from a perusal of sub section (3) of section 401 Cr. P.C. which, reads as follows : 401 (3) "If any condition on which a sentence has been suspended or remitted, is in the opinion of the appropriate Government, not fulfilled, the appropriate Government may cancel the suspension or remission and there upon the person (1) A.I.R. 1939 Rangoon 124. (2) (1) Punjab 201. (3) A.I.R. 1943 Sind 114. 397 in whose favour the sentence has been suspend ed or remitted, may, if at large, be arrested by any police officer without warrant and remanded to undergo the unexpired portion of the sentence". 0 It is manifest from the above provision that on breach of any condition of the remission there is not an automatic revival of the sentence. It will certainly be open to. the Government in a particular case to cancel the remission but it may not. The Government is not under a legal obligation to cancel the remission. It is only when the Government chooses to pass an order of cancellation of the remission of sentence that the convict is arrested and is required to serve the unexpired portion of the sentence. During the interregnum. the accused who is released cannot be said to be under a sentence of imprisonment for life. While he is in enjoyment of the freedom on account of remission, that period is not even reckoned under section 401 Cr. P.C. for the purpose of calculation of the sentence to. be served in the eventuallty. Take the present case. Suppose during the unexpired period of this sentence, which would had normally ended on January 9, 1976, the accused made breach of the first condi tion of the remission giving a slap to a person an offence punishable under section 358 IPC. Clearly there is a breach of one of the conditions laid down, namely, that "he will not commit any offence punishable by any law in Mysore". Can it be conceived that in such a case the Govern ment will immediately cancel the remission and remand him to serve the remaining period of his sentence of imprisonment for life ? That is why section 401 (3) Cr. P.C. advisedly leaves it to the option of the Government to take the penal action and there is no automatic return of the prisoner to the jail. Counsel for the State of Karnataka relies upon the above decisions and also upon the decision of this Court in Sarat Chandra Rabha and Others vs Khagendranath Nath and Others(1). In Sarat Chandra Rabha case (supra) the ques tion of remission under section 401 Cr. P.C. came up for consideration in the context of a disqualification clause under section 7(b) of the Representation of the People Act, 1951. In that case the appellant 's nomination paper was rejected by the Returning Officer for incurring disqualifi cation under section 7(b) of the Representation of the People Act. According to section 7(b) of the Act, a person shall be disqualified for being chosen as a member of either House of Parliament or of the Legislative Assembly or Legislative Council of a State if he is convicted by a court in India of any offence and sentenced to imprisonment for not less than two years, unless a period of five years, or such less period. as the Election Commission may allow in any particular case, has elapsed. , since his release. It was admitted in that case that the appellant was convicted under section 4(b) of the Explosive Substances Act, (VI of 1908) and sentenced to three years ' rigorous impris onment on July 10, 1953 and the nomination paper was filed (1) ; 398 in January 1957 and the election was held in Feburary 1957 Thus the period of five years had not elapsed since iris release by the, State under section 401 Cr. P.C. on November 14, 1954. This Court held in that case that section 401 Cr. P.C., unlike the grant of a free pardon, cannot wipe out either the conviction or the sentence. and affirmed the order of rejection of the nomination paper on the ground of disqualification incurred under section 7(b) of the Representation the People Act. Mr. Nettar for the State emphasises upon the observa tion of this Court in Sarat Chandra Rabha case (supra) that there is no wiping out of the conviction and sentence under section 401 Cr. P.C. in the present case and, therefore, the present appellant 'section conviction and sentence subsisted on the date of the second murder. In Sarat Chandra Rabha case (supra), this Court had to consider the effect of remission vis a vis a disqualifica tion clause under an Act which even provides for removal of disqualification by the Election Commission and which was not actually done. There is a complete purging process provided in the Representation of the People Act itself by an efflux of a period of five years from release on expiry of the sentence. Conviction and sentence recorded by a judicial court cannot be wiped out by executive remission under section 401 Cr. P.C. in order to set at naught the penitentiary period provided for in the Act, in absence of removal of the disqualification by the Election Commission under the Act. Those were the considerations which weighed with this Court when it refused to do away with the effect of the judicial conviction and sentence merely on the basis of executive remission. Even if the sentence were run through without remission, the five years, ' period had to elapse for commencement of new electoral life. The facturn of conviction and the sentence is sufficient and it does not matter whether it has been served out wholly or a portion of it has been remitted. The person remains convicted and sentenced for the purpose of the Representation of the People Act notwithstanding the remission. The decision in Sarat Chandra Rabha 'case (supra) does not at all support the submission that even after remission of the sentence the convict therein was under a sentence of imprisonment. No such Corollary follows flora the above decision of this Court. The observations of this Court in Sarat Chandra Rabha case (supra) with regard to wiping out of conviction and sentence cannot be pressed too far in a criminal trial where the provisions of the penal section have to be very strictly construed and in case of ambiguity or possibility of two views the benefit of construction must be in favour of the accused. To revert, at the end, to the only question with which we started. Was the appellant under sentence of imprisonment for life during the unexpired period of his imprisonment conditionally remitted under 1 section 401 Cr. P.C.? We are clearly of opinion that an accused cannot be under a sen tence of imprisonment for life at the time of commission of the second murder unless he is actually undergoing such a sentence or there is legally extant a judicially final sentence 399 which he is bound to serve without the requirement of a separate order to breathe life into the sentence which was otherwise dead on account of remission under section 401 Cr. P.C. Section 303 IPC is applicable only to an ac cused who, on the date of commission of the second offence of murder, had earlier committed a murder for which his conviction and sentence of imprisonment for life were beyond judicial controversy and were operative. Unlike in the case of section 75, Indian Penal Code, section 303 IPC does not contemplate a mere enhanced punish ment for a convict with a past criminal history for the same offence. Section 303 IPC creates a most aggravated form of offence when committed by a person under sentence of impris onment for life to be punished only with death, the maximum penalty under the law. A person must be actually and irrev ocably a lifer beyond the pale of judicial controversy at the time of commission of the second offence of murder to be visited with the penalty of death under section 303 IPC. If the sentence of a convict had already been remitted at the time of commission of the second murder he would cease to be an actual lifer to come within the lethal clamp of section 303 IPC. For the purpose of section 303 IPC there can be no warrant for introducing a legal fiction of being deemed to be under a sentence of imprisonment for life. The deci sion of the Punjab High Court in Sohan Singh case (supra); with respect, is not correct. We are also, with respect, unable to agree with the view of the Rangoon High Court in Po Kun case (supra). We find from the judgement of the trial court as well as that of the High Court that if the appellant were not con victed under section 303 IPC, a sentence of death would not have been ' imposed on him. For the reasons set out earlier we are clearly of opinion that the appellant is not liable for conviction under section 303 IPC and his sentence of death is, therefore, set aside. The judgment and order of the High Court are set aside to that extent. The appel lant, however, stands convicted under section 302 IPC and is sentenced to imprisonment for life. The appeal is partly allowed with the above modification of the sentence. S.R. Appeal allowed in part.

Section 303 I.P.C. lays down that "whoever being under sentence of imprisonment for life commits murder shall be punished with death". The appellant, for the offence of murder committed on December 3, 1959, had been convicted on July 26, 1961, by the High Court of Mysore under section 302 I.P.C. and sentenced to imprisonment for life in appeal by the State against his acquittal. State Government, in exercise of its power under section 402 Cr. P.C. conditionally remitted his sentence on February 8, 1972 and he was, there fore, conditionally released from jail on February 8, 1972. The two conditions of the remission were that during the unexpired period of his sentence conditionally remitted (i) he will not commit any offence punishable by any law in Mysore and (ii) he will not in any way associate with per sons known to be of bad character or lead a dissolute or immoral life. Even before the expiry of the first year of his. release. , the appellant got himself involved on January 27, 1973, in another murder charge. He was convicted under section 302 read with section 303 I P.C. by the Sessions Judge, Kolar on November 7, 1974 and sentenced to death under section 303 I.P.C. On an appeal to the High Court which was heard along with the reference for confirmation, the sentence of death under section 302 I. P.C. was confirmed on November 19, 1975. It held that section 303 I.P.C. was applicable. as this was In case of conditional remission under section 401 Cr P.C. and the second murder was committed during the unexpired portion of the sentence of imprisonment for life. This Court while granting the special leave limited it to the question of applicability of section 303 I.P.C. and the sentence. Allowing the appeal parly and modifying the sentence of death to that of life imprisonment, the Court, HELD: (1) An accused cannot be under a sentence of im prisonment for life at the time of commission of the second murder unless he is actually undergoing such a sentence or there is legally extant judicially a final sentence which he is bound to serve without the requirement of a separate order to breathe life into the sentence which was otherwise dead on account of remission under section 401 Cr. P.C. [398 H, 399 A] (2) The earlier sentence of imprisonment for life became final and inexor able so far as the judicial process was concerned. It is only when such a sentence is "operative and executable that section 303 I.P.C. a attracted. [395 C] Dilip Kumar Sharma & Ors. State of Madhya Pradesh ; , referred to. (3) Section 303 I.P.C. is applicable only to an accused who on the date of ,commission of the second offence of murder had earlier committed a murder for which his convic tion and sentence of imprisonment for life were beyond judi cial controversy and operative. [399 A] (4) Unlike in the case of section 75. LP.C., section 303 I.P.C. does not contemplate a mere enhanced punishment for a con vict with a past criminal history for the same offence Section 303 I.P.C. creates a most aggregated form of offence when, committed by a person under sentence of imprisonment for life to be punished only with death, the maximum penalty under the law. The true effect 394 of section 303, I.P.C. is that if the accused was continuing to be under the sentence of imprisonment for life on the day of the second murder the court cannot come to his rescue by exercising discretionary clemency in favour of the alterna tive sentence. The only sentence the court has power and is obliged to impose and no other is the sentence of death. [399 B C] (5) A person must be actually and irrevocably the lifer beyond the pale of judicial controversy at the time of commission controversy of the second offence of murder to be vitiated with a penalty of death under section 303 I.P.C. If the sentence of a convict had already been remitted at the time of commission of the second murder, he would cease to be an actual lifer to come within the lethal clamp of section 303 I.P.C. [399 C] (6) For the purpose of section 303 I.P.C. there, can be no warrant for introducing a legal fiction of being deemed to be under a sentence of imprisonment for .life. In the instant case the appellant is not liable for conviction under section 303 I.P.C. [399 D] Sohan Singh vs State Punjab 201, over ruled. (7) Section 401(3) makes it clear that for the purpose. of section 303 I.P.C., it does not make any difference whether the remission under section 401 Cr. P.C. is with or without condi tions. [396 F] Po Kun vs King AIR 1939 Rangoon 124; Sogan Singh vs State Punjab 201; Gulam Mohammad Wali Mohammad vs Emperor AIR 1943 Sind 114 and Sarat Chandra Rabha & Ors. vs Kagendranath & Ors. [1961](2) SCR 133, referred to. (8) Section 401(3) leaves it to the option of the Govern ment to take the penal action and there is no automatic return of the prisoner to the jail on breach of any condi tion of the remission. It will certainly be open to the Government in a particular case to cancel the remission but it may not. The Government is not under a legal obligation to cancel the remission. It is only when the Government chooses to pass an order of cancellation of the remission of sentence that the convict is arrested and is required to serve the unexpired portion of the sentence. During the interval the accused who is released cannot be said to be, under a sentence of imprisonment for life while. is in enjoyment of the freedom on account of remission. That period is not even reckoned under section 401 Cr. P.C. for the purpose of calculation of the sentence to be served in the eventuality. [397 B C, E]

N: Criminal Appeals Nos. 224 and 268 of 1977. 606 Appeals by Special Leave from the Judgment and Order dated 19 3 77 of the Judicial Commissioner 's Court. Goa, Daman and Diu at Panaji in Criminal Appeal Nos. 19 and 21 of 1973. T. Godiwala, P. C. Ghokhale and B. R. Agarwala for the Appellant in Crl. A. No. 224/77. section Bhandare for the Appellant in Crl. A. No. 268/77. H. R. Khanna and M. N. Shroff for the Respondent. The Judgment of the Court was delivered by KOSHAL, J. By this judgment we shall dispose of Criminal Appeals Nos. 224 and 268 of 1977 in both of which a judgment dated 19th of March, 1977 of the Judicial Commissioner, Goa, upholding the conviction of the appellants and the sentences imposed upon them by the trial court is challenged. The appellants were tried jointly by the Special Judge, Panaji, who found them guilty and awarded them punishments as specified in the table below: Serial Name of the Section of the law under Sentence number accused which conviction recorded of the accu sed (1) (2) (3) (4) 1. Abdulla (a) Section 120B(1) Rigorous imprison Mohammed read with sect ment for two years Pagarkar ions 420, 468 and a fine of Rs and 471 of the 500/ ,the sentence Indian Penal in default of Code as also payment of fine Section 5(1)d being rigorous of prevention of imprisonment for Corruption Act. for one month. (b) Sections 420 Rigorous imprison and 468 and ment for two years Section 109 read and a fine of with sections Rs. 500/ , the 468 and 471 of sentence in defa the Indian Panel ult of payment of Code. fine being Rigo rous imprisonment for one month. (c) Section 5(2) Rigorous imprison section 5(1)(d) ment for two years of the Preven and a fine of tion of Corrup rupees two lakhs, tion Act. sentence in defa ult of payment of fine being rigorous imprison ment for eighteen months. 607 (1) (2) (3) (4) 2. Moreshwar (a) Section 120B(1) Rigorous impriso Hari read with nment for two Mahatme sections 420, years and a fine 468, 471 and 109 of Rs. 500/ , the of the Indian sentence in defa Panel Code ult of payment of as well as sec fine being rigor tion 5(1)(d) of ous imprisonment the prevention for one month. of corruption Act. (b) Section 5(1)(d) of the Prevention of Corruption Act read with section 109 of the Indian Penal Code. (c) Sections 420, 468 Rigorous impriso and 471 read with nment for two sections 109 of years and a fine the Indian Panel of Rs. 500/ , Code. the sentence in default of payment of fine being rigorous imprisonment for one month. (d) Section 5(2) read Rigorous impriso with section nment for two 5(1)d of the years and a fine Prevention of of rupees two Corruption Act lakhs, the and section 109 sentence in default of of the Indian payment of fine Penal Code. being rigorous imprisonment for eighteen months. All the substantive sentences of imprisonment in the case of each of the accused were directed to run concurrently. It may be stated here that the charges framed against them under sections 467 and 477A of the Indian Penal Code were not found proved and they were acquitted of the same. The prosecution case has to be set out at some length and may be stated thus. In the year 1965 the appellant Abdulla Mohammed Pagarkar (hereinafter referred to as A 1) was holding the post of Surveyor in Charge, Mercantile Marine Department, Marmagoa as also of the Captain of Ports, Panaji. In his capacity last mentioned, the work of deepening and widening the Kumbarjua canal which connects river Zuari with river Mandovi required his urgent attention as the canal had to be made navigable at low tide for the use of mine barges during monsoon season when the sea becomes rough and it is hazardous to navigate across the mouth of the river Mandovi at Aguda. A survey of the canal had been carried out by the Marmagoa Port Trust and its report had been 608 submitted to the concerned authorities. Tenders were invited by A 1 through an advertisement in the press and appellant Moreshwar Hari Mahatme (hereinafter described as A 2) was the only person to present one, which he did on the 5th of January, 1966. As the cost of the work exceeded rupees one lakh and the tender was a solitary one, the Lieut. Governor forwarded it to the Central Government for approval and did not accept a suggestion made by the Secretary to the Industries and Labour Department (to be hereinafter called I.L.D.) that the work be started immediately in anticipation of the said approval. Nevertheless A 1 entrusted the work to A 2 who started executing it on March 15, 1966. No approval of the tender was received from the Government of India who directed, however, that the work be carried out departmentally. Through a letter dated 16th of May, 1966 (Exhibit P 7), the said Secretary informed A 1 that as the work was to be executed departmentally the conditions laid down in Rules 133 and 141 of the General Financial Rules (G.F.R.) had to be fulfilled and directed him to obtain the concurrence of the Public Works Department (P.W.D. for short) for the various rates mentioned in a bill which A 1 had submitted earlier for payment in connection with the work. Such concurrence was obtained by A 1 on May 26, 1966, to payment of daily wages at the rates of Rs. 4.50 and Rs. 3.00 per head for male and female labourers respectively although the prevailing P.W.D. rates were Rs. 3.50 and Rs. 2.00 respectively (Exhibit P 9) The two appellants entered into a conspiracy to cheat the Government in relation to the execution of the work. A 2 would submit occasionally to A 1 hand written statements of the work done each day, specifying therein the details of quantity in cubic metres of the mud and salt excavated, the number (without the names) of male and female labourers employed, the cost of labour in accordance with the approved rates, charges for the country craft employed, etc. None of these statements bore the signature of A 2. A 1 would get typed copies of these statements prepared in his office and would send one of such copies under his own signature to the I.L.D. for sanction which used to be accorded after the concurrence of the Finance Department had been obtained. Thereafter a contingent bill would be prepared in the office of A 1 and in that bill A 1 would certify under his own signature that the work was carried out departmentally in compliance with Rule 141 of the G.F.R. Each of such bills accompanied by the relevant copy of the statement of work signed by A 1 would be forwarded to the Accounts Department which would issue a cheque in favour of A 1 who would realise the amount of the cheque and pay it in cash to A 2 against a regular receipt. 609 A stage was reached when the Directorate of Accounts objected to the payment of the bills and asked for muster rolls of labourers employed for execution of the work. A 1 then had prepared register exhibit P 37 and muster roll exhibit P 36 on the basis of entries in a copy book (exhibit P 47) which had been supplied to A 1 by A 2. The entries in the muster roll having been found to be suspicious, the case was entrusted to the Central Bureau of Investigation who found that, as against a total amount of Rs. 4,73,537.50 paid by the Government to A 1 and by him to A 2, the work done was worth no more than Rs. 76,247.43. It was this conclusion which led to the prosecution of the appellants. Now we shall give a resume of the defence stand taken by A 1. He held numerous offices in addition to that of the Captain of Ports and as such he had to perform multifarious duties while the staff placed at his disposal was grossly inadequate by any standards so much so that he did not even have an Accounts Officer. As the work of deepening and widening the Kumbarjua canal needed urgent attention, tenders for its execution were called and A 2 was found to be the only tenderer. A 1 was assured by the Secretary, I.L.D., that the necessary order approving the tender would soon be forthcoming and that the execution of the work should be taken in hand immediately in anticipation of orders. The Assistant Marine Surveyor, Shri D 'Souza (PW.4) was instructed to personally supervise the work which was started on the 15th of March, 1966. By the end of April, 1966, A 1 was told that the work should be executed departmentally by engaging labour and not through A 2. However that was not possible under the circumstances and the work proceeded as before. Shri D 'Souza (PW. 4) used to check the volume and the kind of material excavated daily and to make entries in his notebook accordingly. When objection was taken by the Directorate of Accounts at the end of the financial year to the passing of the bills on the ground that muster rolls were not being maintained, A 1 made enquiries from Shri D 'Souza (PW 4) and learnt that A 2 had maintained a gang wise muster roll on the basis of which documents were prepared by Shri D 'Souza (PW 4) under the orders of A 1 and were submitted to the I.L.D. The work was executed in conformity with the bills submitted by A 1 to the Government. In any case, A 1 acted in good faith and if any of the bills did not conform to facts the reason must be that he had been cheated by A 2. 4. The stand taken by A 2 in defence was more or less the same. He averred however that the bills were prepared not on the basis of labour engaged but on the volume of work done, that he never sup 610 plied any labour to A 1, that the total material excavated amounted to 35,516.70 cubic metres, that there was no question of keeping any muster or acquittance roll as the work was executed by the labourers on piece rate basis and that the average number of labourers working per day for execution of the work was about 700. From the documentary evidence placed on the record at the trial the learned Special Judge found the following facts proved: (a) Under directions of A 1 the execution of the work was started by A 2 before the tender submitted by the latter, which had been forwarded by the Lieut. Governor for approval to the Government of India, had been accepted. (b) Through a letter dated the 16th May, 1967 (exhibit P 7) the Secretary, I.L.D., directed A 1 to have the work executed departmentally in accordance with the conditions laid down in Rules 141 and 133 of the G.F.R. and to obtain concurrence of the P.W.D. to various rates applicable to the work. Such concurrence was actually obtained by A 1 (Letters exhibits P 8 and P 9). (c) The work was being carried out by A 2 with his own labour and no labour on muster roll was employed by A 1. (d) A 2 prepared statements of work or summaries which he submitted to A 1 who would then sign typed copies thereof and forward the same for sanction to the I.L.D. On receipt of such sanction A 1 would prepare contingent bills and sign each of them along with a certificate that the work was being carried out departmentally in accordance with Rule 141 of the G.F.R. as per the attached summary. Each bill would then be submitted along with the summary to the Accounts Department which issued the corresponding cheque to A 1. The amount of the cheque was then realised by A 1 and paid over to A 2 under a receipt. (e) Muster roll exhibit P 36 for the period from 15 3 1966 to 6 4 1967 was prepared in the office of A 1 and under his directions at a stretch after the completion of the work and on the basis of exhibit P 47 which A 2 had maintained. Register exhibit P 37 was similarly prepared on the basis of 611 written statements containing details of labour employed and submitted by A 2. 6. The learned Special Judge further arrived at the findings given below from the oral evidence produced before him: (i) A 2 was fully aware that his tender had not been accepted by the Government and that A 1 had been directed to carry out the work departmentally. (ii) The amount really spent by A 2 in execution of the work was no more than Rs. 32,287.75 against which he manoeuvred, with the assistance of A 1, to receive a sum of Rs. 4,73,537.50 from the Government. (iii) None of the bills could have been sanctioned for payment by the Accounts Department but for the certificate appended by A 1 to each of them that the work was being carried out departmentally under Rule 141 of the G.F.R. 7. From the above findings the learned Special Judge concluded that the two accused had entered into a conspiracy to cheat the Government in the matter of the execution of the work by presenting inflated bills and receiving against them far greater amounts than had actually been spent, that muster rolls ultimately produced to support the bills contained false averments and were forged documents, and that A 1 was fully aware that the certificate regarding the work being carried out departmentally in accordance with Rule 141 of the G.F.R. and appended to each of the bills was false. It was also proved to his satisfaction that muster roll exhibit P 36 and register exhibit P 37 were dishonestly or fraudulently prepared by A 1 to support false bills and that this was done with the assistance of A 2. The amount really spent on the work done having been found by the learned Special Judge to be only Rs. 32,287.75, he held that the Government had been cheated into an excess payment of Rs. 4,41,249.75. It was in these premises that the learned Special Judge convicted and sentenced the two accused as stated earlier. The learned Judicial Commissioner upheld the findings of fact arrived at by the learned Special Judge except the one relating to the amount actually spent in execution of the work which, in his opinion, was Rs. 76,247.43 as made out by the entries in books exhibits P 79 to P 82 which were recovered as a result of a search of the house of A 2. The conviction recorded against and the sentences imposed upon 612 the appellants by the learned Special Judge were therefore confirmed by the learned Judicial Commissioner. On behalf of the appellants it was vehemently contended before us by their learned counsel that the tender submitted by A 2 was actually accepted by the Government and that it was on that basis that the entire work was executed. In support of this argument there is not a shred of evidence on the record and we have therefore no hesitation in rejecting it straightway. In exhibit P 7 there is a clear intimation to A 1 that the work was to be carried out departmentally and that therefore he should obtain concurrence of the P.W.D. to the rates applicable to various items of work. Faced with this situation learned counsel for A 1 submitted that even under Rule 141 of the G.F.R. any work to be carried out departmentally could be entrusted to a contractor and in that submission he is right. However, it carries his case no further inasmuch as no bills were drawn nor was any sanction accorded to any payment on the basis of any part of the work having been executed through A 2 working as a contractor. On the other hand those bills contained the number of labourers engaged for the work and the amounts claimed pertained to their wages at the sanctioned rates. In fact no bill contains even a mention of the fact that any contractor was executing the work or that A 2 was anywhere in the picture. Add to it the fact that A 2 did not submit any signed bills or statements either to A 1 or to the I.L.D. or, for that matter, to the Directorate of Accounts. In so far as correspondence between A 1 on the one hand and Government departments on the other is concerned, the name of A 2 and his connection with the execution of the work remained conspicuous by its absence except insofar as the tender submitted by him was concerned and that tender, as already stated, never became effective by its acceptance by any department or office of the Government. The position which the two appellants therefore took in no uncertain terms throughout the period during which the work was executed was that it was being handled directly by the Department and not through any contractor. Any plea based on its execution through A 2 as a contractor must therefore be repelled. A more serious argument put forward in support of the appeals was that the work actually executed had not really been shown to be worth anything less than the amount paid for it to A 2, i.e., Rs. 4,73,537.50. The attack on the findings to the contrary arrived at by the two courts below consists of the submission that they are based really on mere conjectures rather than on evidence. And this attack appears to us, on a consideration of the material on the record, to be well founded, as we shall presently show. 613 11. The amount of Rs. 4,73,537.50 was received by A 1 against 4 bills the details of which appear below: Serial Exhibit mark on the bill Amount of the bill number Rs. 1. P 13 . 98,294.50 2. P 18 . . 82,811.00 3. P 24 . 84,847.00 4. P 28 . . 2,07,585.00 Total . 4,73,537.50 As already stated, each of the bills above mentioned was accompanied by a document detailing the number of labourers employed. Other particulars such as sex of and rate of wages payable to each labourer also appeared in the document which has been described as a "summary". It is admitted on all hands that each bill conformed to the corresponding "summary" but was not accompanied, when submitted or passed, by any vouchers. The case propounded on behalf of the State is that the summaries contained false entries so that the number of labourers actually employed for the execution of the work was grossly inflated and that it was on that account that the appellants were able to draw moneys from the State Treasury far in excess of those actually paid by them for the execution of the work. On the other hand, the claim on behalf of the appellants is that no evidence at all is available to indicate that any of the entries made in the summaries as also in the bills did not conform to facts. The learned Special Judge analysed the oral evidence of PWs. 1, 4, 7, 8, 13, 14, 17, 19 and 20 and observed that the number of labourers including the crew of the country craft working at all the sites where dredging was in progress during the period in question varied, according to those witnesses, from 80 to 200. He further noted the fact that in the statement recorded under section 342 of the Code of Criminal Procedure even A 1 had taken the stand that the number of labourers found by him working at the canal, whenever he visited the site, varied between 200 and 250. He then proceeded to quantify the amount of money paid to the labourers at Rs. 32,287.75 with the following observations: "From the receipts produced by the prosecution witnesses Nos. 7, 8, 9, 10, 14, 15, 16, 17, 18, 19, 20 and 21 it is seen that the amount paid by A.2 to the labourers and country craft owners is to the tune 614 of Rs. 32,287.75. There was no suggestion of the Advocate of A.2 to the Investigation Officer that besides the documents produced by A.2, there were other receipts which were not attached by the Investigating Officer and produced by the prosecution. The only contention of A.2 appears to be that, besides the amounts proved by the receipts above, there were other amounts paid to the labourers for which receipts were not collected. All the prosecution witnesses above had denied the suggestion of A.2 that, besides the amounts for which they have passed receipts, there were other amounts received by them for which they have not passed the receipts. Only P.W. 14 and P.W. 16 in their cross examination, had admitted that besides the amounts for which they had issued receipts, they were also paid for some work on salary basis for which they were not issued receipts. These amounts, however, could not, according to me, go to thousands of rupees. Any how, it was for A.2 to prove that he had spent amounts besides those proved by the prosecution which A.2 had failed to do. " Now this is hardly a proper approach to the requirements of proof in relation to a criminal charge. The onus of proof of the existence of every ingredient of the charge always rests on the prosecution and never shifts. It was incumbent therefore on the State to bring out, beyond all reasonable doubt, that the number of labourers actually employed in carrying out the work was less than that stated in the summaries appended to the bills paid for by the Government. It is true that the total number of labourers working on a single day has been put by the prosecution witnesses mentioned above at 200 or less, while according to the summaries appended to the bills it varied on an average from 370 to 756. But then is it safe to rely on the mere impression of the prosecution witnesses, testified to long after the work had been executed, about the actual number of labourers employed from time to time? The answer must obviously be in the negative and the justification for this answer is furnished by the variation in the number of labour employed from witness to witness. The mind of the learned Special Judge in coming to the finding about the value of the work done being no more than Rs. 32,287.75 appears to have been influenced by the gross irregularities committed by the appellants in the execution of the work, specially their failure to prepare vouchers relating to all the payments as also a proper muster roll. These irregularities no doubt furnish a circumstance giving rise to a strong suspicion in regard to the bona fides of the appellants in the matter of the execution of the work but suspicion, however strong, cannot be a substitute for proof. And it is certainly not permissible to place the burden of proof of innocence on the person accus 615 ed of a criminal charge. However, that is precisely what the Special Judge appears to have done while observing that "it was for A.2 to prove that he had spent amounts besides those proved by the prosecution which A.2 had failed to do." 13. The finding of the learned Judicial Commissioner on the point suffers from a similar defect. After examining the oral evidence in relation to it he observed: "The evidence of these witnesses clearly indicated that the average total number of labourers working in the Canal per day were 100 to 160. Taking an average of 123 labourers per day, out of which, on the basis of the statements furnished by A.2, less than 12000 would be males at the rate of Rs. 4.50 and a little more than 13000 females at the rate of Rs. 3.50, we have roughly a total sum of Rs. 80,000/ spent on labour. This more or less tallies with the amount mentioned in the vouchers. Shri section V. Naik has on behalf of A.2 suggested in cross examination of these witnesses that the average number of workers working in the canal per day was 350 to 400. Even if we accept this figure the total amount payable on account of the labourers employed would be Rs. 3,00,000.00, but the accused have collected a sum of Rs. 4,73,537.50." He differed with the learned Special Judge on the point of the value of the work actually done and in that behalf he has reasoned thus in another part of the judgment: "No account books or receipts were produced by A.1 or A.2 to the Government in support of the contingent bills and of the claims for the amounts which they received. No account books were produced or shown by any one of them. It is not the case of A.2 that he did not receive receipts for the payments made to the labourers, nor is it his case that he did not have any account books regarding the work. In fact, it would be unbelievable that a businessman or a labour supply contractor should not keep account books or should not receive receipts for payments made. It is not the case of A.2 or A.1 that they had lost the account books or the receipts. When a search was effected of the residence of A.2, receipt books Exh. P. 79 and P. 82 and some books relating to the work were seized. When a question was put to A. 2 under section 313 of the Code of Criminal Procedure, 1973, regarding this evidence, 616 his answer was that neither the receipt books nor the books were account books. The receipts in the books are in serial numbers from 101 to 700. In the first search taken receipts bearing serial Nos. 151 to 200 for the period from 14 4 66 to 25 1 68 were missing. These receipts were all in one book, namely, Exh. exhibit P.82 was seized on a subsequent search. Another book exhibit P.82 was also found in subsequent search. This book bears no serial numbers. All these three books constitute exhibit P.79, 80 and P.82 containing receipts relating to the work. The total amount mentioned in the receipts relating to the work was Rs. 76,248.43. A.2 has not stated that he had vouchers for any other money paid by him nor has he produced any such vouchers. P.Ws No. 7 to 10 and 14 to 21, twelve in all, who did the work of excavation in the canal have stated that they passed receipts for all moneys received by them. When suggestions were made to some of them that some payments were made to them without receipts, they denied the fact. The other books seized, namely, exhibit P. 81 collectively, were, according to A.2, cash books. However, serial No. 23/II item No. 35, which was part of exhibit P. 81 is definitely an account book and not a cash book. In any event, A.2 does not rely on any of these books nor has he said anything to show that any payments were recorded therein, which are other than the payments shown in exhibit P.79, 80 and 82. A.2 did not examine any workers who worked in the canal and who, according to him, had received any payments which were not receipted for. It is evidence from exhibit P.79 to P.82 that some moneys spent in the work were receipted and accounted for. Considering all these facts, the question that A.2 might have paid any amounts without receiving receipts can be ruled out. exhibit P.79 to P.82 together with the other evidence on record support the version of the prosecution that the total amount of work done by the accused did not exceed Rs. 76,248.43. " We may at once state that there is no evidence on the record to indicate that the books seized from the premises of A.2 contained entries about all the payments made by him to the labour employed for the execution of the work and that is a fact the correctness of which we see no reason to presume. The danger of assumptions of the type made by the two courts below is highlighted by the disparity in the figures which they reached in relation to the amount of the value above mentioned. Each had his own way of looking at 617 it; but then the grievous error into which they fell was that they thought that it was for the accused to show that the number, of labourers employed conformed to that shown for each day in the summaries attached to the bills. And that is an approach not sanctioned by law. In coming to the finding under consideration the learned Judicial Commissioner also took into consideration the deposition of Lasli Rupert Donaud (PW 6) who surveyed the canal in September, 1965 and again in May, 1969, i.e., both before and after the work had been executed and in that connection prepared two documents, viz., exhibits P 55 and P 66, detailing his observations on the two occasions respectively. According to the witness the volume of solids to be dredged "to a depth of 10 feet below datum equals 5858 cubic metres". This figure is roughly one fifth of 28,324.70 cubic metres which is the volume of total material alleged by the appellants to have been actually removed during the execution of the work and paid for. The argument advanced on behalf of the State that the disparity in the two figures itself shows that the claim of the appellants is false, although attractive on the face of it is not acceptable to us on a deeper consideration. According to PW 6, the soundings taken on the two occasions were almost identical from which it was sought to be deduced that practically no work at all was done, which is not the case of either party. This shows that either the contents of the two documents represented observations which did not conform to facts or which, in any case, could not be taken as a safe guide for calculating the actual number of labourers employed during the execution of the work which was carried out between the two surveys. Besides, our attention has not been drawn by learned counsel for the State to any evidence from which it may be inferred that the portions of the canal where soundings were taken by PW 6 represented the entire length of the canal in relation to its breadth and depth. Again, the silting process which is a continuous one, cannot be lost sight of. In between the point of time when the first survey was undertaken by PW 6 in 1965 and the end of the period during which the work was executed, a lot of silt must have settled at the bed of the canal and dredged out which would surely mean a considerable increase in the work actually done over the figure of 5858 cubic metres resulting from his estimate. Also siltation may have occurred and, for aught one knows, to a considerable extent, between the completion of the work and the point of time when PW 6 took the soundings in 1969. Allowance has also to be made for the state of the tide when the surveys were undertaken. As pointed out by the witness himself, the 618 soundings of 1969 were not taken at the lowest tide. As it is, the witness had to make the following admission when he was asked if he could say on the basis of his two surveys whether any dredging was done in between: "If some dredging is done during the year 66 and 67 in the Canal and the soundings are taken in 1969 if it is almost identical to the soundings of 1965 I would not be able to say whether dredging was done in the Canal or not. " We consider it very unsafe, in this state of the evidence to agree with the learned Judicial Commissioner that the disparity between the estimate arrived at by PW 6 and the volume of material claimed to have been dredged proved "that the documents on which moneys were collected by the accused are false". It appears to us that in coming to this conclusion, he was also influenced by the factors which raised a strong suspicion against the appellants. Learned counsel for the State to buttress the evidence which we have just above discussed with the findings recorded by the learned Special Judge and detailed as items (a) to (e) in paragraph 5 and items (i) and (iii) in paragraph 6 of this judgment. Those findings were armed by the learned Judicial Commissioner and we are clearly of the opinion, for reasons which need not be re stated here, that they were correctly arrived at. But those findings merely make out that the appellants proceeded to execute the work in flagrant disregard of the relevant Rules of the G.F.R. and even of ordinary norms of procedural behaviour of Government officials and contractors in the matter of execution of works undertaken by the Government. Such disregard however has not been shown to us to amount to any of the offences of which the appellants have been convicted. The said findings no doubt make the suspicion to which we have above adverted still stronger but that is where the matter rests and it cannot be said that any of the ingredients of the charge have been made out. Apart from the findings and evidence referred to earlier in this paragraph, no material has been brought to our notice on behalf of the State such as would indicate that the bills or the summaries in question were false in any material particular. Although it does appear that quite a few of the documents admittedly prepared by or at the instance of the appellants in connection with the execution of the work came into existence not while the work was in progress but only later when a demand for them was made by the Accounts Department, the charge cannot be sustained in relation to any of its heads, there being no proof of the falsity of any 619 of the entries made in those documents. In the result, therefore, we accept both the appeals, set aside the conviction recorded against and the sentences imposed upon each of the appellants and acquit them of the charge in its entirety. N.V.K. Appeals allowed.

A survey carried out by the Port Trust suggested that the canal connecting two rivers required urgent deepening and widening to make it navigable for barges during the monsoon season when the sea turned rough and navigation became hazardous across the mouth of the river. The appellant (A 1) who at that time was the Captain of Ports invited tenders through press advertisement and the appellant in the Second Appeal (A 2) was the only person who submitted a tender. Since the tender was the only one received, the Lt. Governor forwarded it to the Central Government for approval. He did not accept the suggestion that in view of the urgency, the work might be taken up immediately in anticipation of approval. Even so A 1 entrusted the work to A 2 who started the work. In the meantime the Government of India directed that the work should be carried out departmentally. A 1 obtained concurrence of the public works department for payment of daily wages to workers. According to the prosecution, the modus operandi adopted by the appellants was that A 2 actually submitted hand written statements without his signature on the work done each day specifying the quantity of cubic meters of mud and salt excavated, the number (without names) of male and female labourers employed, the wages paid to labour at the approved rates and so on. A 1 got the required statements typed in his office and sent them for the concurrence of the Finance Department through the concerned department. Thereafter A 1 drew the amounts and paid cash to A 2 against a regular receipt. In course of time the Directorate of Accounts asked for muster rolls of labourers employed in the work. A 1 prepared a register and muster rolls. On a suspicion regarding the genuineness of the muster rolls, the case was entrusted to the Central Bureau of Investigation which reported that against a total sum of Rs. 4.73 odd lacs paid by the Government to A 1 the work done was not worth more than Rs. 76,247/43. The Special Judge convicted and sentenced both the appellants on the ground that they had entered into a conspiracy to cheat the Government in the matter of execution of the work by presenting inflated bills and receiving against them far greater amounts than had actually been spent and that the muster rolls produced were false documents. The Judicial Commissioner up held the findings of the Special Judge. Allowing the appeals, ^ HELD: 1. There is no evidence on record that the tender submitted by A 2 was actually accepted by the Government and that it was on that basis that the entire work was executed. [612 B] 605 2. Although it may be correct to say that even a work which is required to be carried out departmentally can be entrusted to a contractor, in the instant case no bills were drawn nor was sanction accorded to any payment on the basis of any part of the work having been executed through A 2 working as a contractor. The bills contained the number of labourers engaged and the amount pertaining to their wages at the sanctioned rates. No mention was made in the bills that the work was being carried out through a contractor. A 2 did not sign any of the bills and his name as well as his connection with the execution of the work remained conspicuous by its absence therefrom. [612 C E] 3. The onus of proof of the existence of every ingredient of the charge always rests on the prosecution and never shifts. It was incumbent on the State to bring out beyond all reasonable doubt that the number of labourers actually employed in carrying out the work was less than that stated in the summaries appended to the bills paid for by the Government. [614 D E] 4. Although there was a difference between the number of labourers engaged on each day as deposed to by the prosecution witnesses and that shown in the bills it is not safe to rely on mere impression of the prosecution witnesses long after the work had been executed. [614 F] 5. The irregularities committed by the appellant in the execution of the work do furnish a circumstance giving rise to a strong suspicion in regard to the bonafides of the appellants in relation to execution of the work, but mere suspicion, however strong, cannot be a substitute for proof. It is not possible to place the burden of proof of innocence on the person accused of a criminal charge [614 H] 6. In regard to the value of work actually done there was sharp disparity in the figures arrived at by the courts below. The view of the Courts below that it was for the accused to show that the number of labourers employed conformed to that shown each day in the summaries attached to bills, is an approach not sanctioned by law. [616 H 617 A] 7. The prosecution has not established that the bills or the summaries were false in material particulars. Although the appellants proceeded to execute the work in flagrant disregard of the relevant rules and ordinary norms of procedural behaviour of Government officials and contractors in the matter of execution of works undertaken by the Government, such disregard has not been shown to amount to any of the offences of which the appellants have been convicted. The findings of the lower courts no doubt make the suspicion still stronger but it cannot be said that any of the ingredients of the charge had been made out. [618 C, E F] 8. Although some of the documents were prepared at the instance of the appellants when a demand for them was made by the Accounts Department, the charge cannot be sustained in relation to any of its heads, their being no proof of falsity of any of the entries made in those documents. [618 H]

Criminal Appeal No. 189 of 1966. Appeal by special leave from the judgment and order dated July 4, 1966 of the Patna High Court in Criminal W.J.C. No. 11 of 1966. B.R.L. lyengar and U.P. Singh, for the appellants. V. A. Seyid Muhammad and S.P. Nayar, for respondent No. 1. The Judgment of the Court was delivered by Hegde J. This appeal against the decision of the High Court of Patna in Criminal W.J.C. No. 11 of 1966 was brought after obtaining special leave from this Court. The principal question raised herein is whether the investigation which is being carried on against the 'appellants under sub rule (3 ) of rule 3 of Sugarcane (Control) Order, 1955 (to be hereinafter referred to as the Order) read with section 7 of the (to be hereinafter referred to as the Act) is in accordance with law. The appellants are office bearers of M/s. S.K.G. Sugar, Ltd.(Lauriya). A complaint has been registered against them under sub rule (3) of rule 3 of the Order read with section 7 of the Act on the ground that they have failed to pay to the sellers the price of the sugarcane purchased by them, within the time prescribed. The said complaint is being investigated. The appellants are objecting to that investigation on various grounds. They unsuccessfully sought 'the intervention of the High Court of Patna under article 226 of the Constitution in Cr. W.I.C. No. 11 of 1966. Hence this appeal. 675 Mr. B.R.L. Iyengar appearing for the appellants challenged the validity of the investigation in question on various grounds. We shall now proceed to deal with each one of those grounds. The 1st contention of Mr. Iyengar was that sub rule (3) of rule 3 could not have been validly issued under section 3 of the Act. According to him the said section 3 cannot be used for controlling the payment of the price of food crops; it can only deal with foodstuffs; food crops are outside its scope. This contention has been negatived by the High Court. We agree with the High Court that there is no merit in this contention. Section 2(a) of the Act defines "essential commodity". Sub cl. (v) of that clause brings. foodstuffs within the definition of essential commodity. Clause (b) of section 2 provides that food crops include sugarcane. The next important provisions in the Act are cls. (b) and (c) of section 3(1). Section 3 (1 ) provides that if the Central Government is of opinion, that it is necessary or expedient so to do for maintaining or increasing supplies of any essential commodity or for securing their equitable distribution and availability at fair prices, it may, by order, provide for regulating or prohibiting the production,. supply and distribution thereof and trade and commerce therein. Sub section (2)of that section says that without prejudice to the. generality of the _powers conferred by sub section (I ) an order made. thereunder may provide . . "(b) for bringing under cultivation any waste or arable land, whether appurtenant to a building or not, for the growing thereon of food crops generally or of specified food crops, and for otherwise maintaining or increasing ' the cultivation of food crops generally, or of specified food crops;" Clause (c) provides for controlling the price at which any essential commodity may be bought or sold. From the scheme of cls. (b) and (c) of section 2 and section 3 of the Act, it is clear that the Parliament intended to bring under control the cultivation and ' sale of food crops. In view of these provisions it is idle to contend that sugarcane does not come within the ambit of the Act. The question whether the cultivation and sale of sugarcane can be regulated under section 3 of the Act came up for the consideration of this Court in Ch. Tika Ramji and Ors. vs The State of U.P. and Ors.(1) At pages 432 and 433 of the report it is observed : "Act X of 1955 included within the definition of essential commodity foodstuffs which we have seen above would include sugar as well as sugarcane. This Act was enacted by Parliament in exercise. of ' the con (1) 676 current legislative power under ' Entry 33 of List III as amended by the. Constitution Third Amendment Act, 1954. Foodcrops were there defined as including crops of sugarcane and section 3 (1 ) gave the Central Government powers to control the production, supply and distribution of essential commodities and trade and commerce therein for maintaining or increasing the supplies thereof or for securing their equitable distribution and availability at fair prices. Section 3(2)(b) empowered the Central Government to provide inter alia for bringing under cultivation any waste or arable land whether appurtenant to a building or not for growing thereon of foodcrops generally or specified foodcrops and section 3(2)(c) gave the Central Government power for controlling the price at which any essential commodity may be bought or sold. These provisions would certainly bring within the scope of Central legislation the regulation of the production of sugarcane as also the controlling of the price at which sugarcane may be bought or sold, and in addition to the Sugar Control Order, 1955 which was issued by the Central Government on 27th August, 1955, it also issued the Sugarcane Control Order, 1955, on the same date investing it with the power to fix the price of sugarcane and direct payment thereof as also the power to regulate the movement of sugarcane. Parliament was well within its powers in legislating in regard to sugarcane and the Central Government was also well within its powers in issuing the Sugarcane Control Order, 1955 in the manner it did because all this was in exercise of the concurrent power of legislation under Entry 33 of List III. " It is needless to say anything more on this question. It was next contended by Mr. Iyengar that the regulation of the price of sugarcane is expressly dealt with by the Bihar Sugar Factories Control Act, 1937 and therefore we should not impliedly spell out the same power from the provisions of the Order and the Act. Mr. Iyengar is not right in contending that the power that is sought to be exercised in the instant case is an implied one. Sub rule (3) of rule 3 specifically provides that unless there is an agreement in writing to the contrary between the parties the purchaser shall pay to the seller the price of the sugarcane purchased within 14 days from the date of the delivery of the sugarcane. This is a .specific mandate. If the Bihar Act provides anything to the contrary the same must be held to have been 677 altered in view of article 372 of the Constitution which provides that all laws in force in the territory of India immediately before the commencement of this Constitution shall continue in force therein until altered or repealed or amended by a competent legislature or other competent authority. Quite clearly the Bihar Act is a pre Constitution Act and it could have continued to be in force only till it was altered, repealed o.r amended by a competent legislature or other competent authority. We shall presently see that the authority that altered or amended that law is a competent one. The next contention of the learned Counsel for the appellants was that the Parliament had no competence to enact any law relating to the control of sugarcane as that subject is within the exclusive legislative jurisdiction of the State, the same being a part of agriculture. This contention is again unsustainable in view of Entry 33 of List III of the Constitution which empowers the Parliament to legislate in respect of production, supply and distribution of foodstuffs. It is not disputed that the Parliament had declared by law that it is expedient in public interest that it should exercise control over foodstuffs. That being so it was well within the competence of Parliament to enact the Act and hence the power conferred on the Government ,under section 3 of the Act cannot be challenged as invalid. There is no substance in the contention that the impugned order contravenes the fundamental right guaranteed to the citizens under article 19 (1 ). No fundamental fight is conferred on a buyer not to pay the price of the goods purchased by him or to pay the same whenever he pleases. The contention that in view of section 11 of the Act, no cognizance could have been taken of the offence alleged is premature. This question does not arise in this ease. No court has yet taken cognizance of the case. That stage has Still to come. There is no substance in the contention that the complaint made before the police does not disclose a Cognizable offence and as such the police could not have taken up the investigation of that complaint. The offence complained of is punishable with three years ' imprisonment and as such it falls within the 2nd Sch. of the Cr. P.C. and consequently the same is a cognizable offence as defined in section 4(1)(f) of the Cr. Hence it was open to the police to investigate the same. For the reasons mentioned above we are unable to accept any of the contention advanced on behalf of the appellants. In the result this appeal fails and the same is dismissed. G.C. Appeal dismissed.

The appellants were the office bearers of a sugar concern. A complaint with the police was registered against them under sub rule 3 of Rule '3 of the Sugarcane (Control) Order, 1955 read with section 7 of the , On the ground that they had failed to pay to the sellers within the time prescribed the price of the sugarcane purchased by them. Objecting to the investigation of the alleged offence the appellants filed a writ petition under article 226 of the Constitution but the High Court ' refused to interfere. By special leave they came to this Court. The contentions urged on behalf of the appellants were (i) that sub rule 3 of rule 3 could not have been validly issued under section 3 of the because the latter section applied only to foodstuffs and not to food crops (ii) that the regulation of the price of sugarcane being expressly dealt with by the Bihar Sugar Factories Control Act, 1937 the same power could not by implication be spelt out from the provisions of the Order and the Act, (iii) that Parliament had no competence to enact any law relating to the control of sugarcane as that subject was within the exclusive legislative jurisdiction of the State, the same being a part of agriculture. (iv) that there was violation of the fundamental right under article 19(1) of the Constitution by the impugned order. (v) that in view of section 11 of the Act no cognizance could have been taken of the offence, (vi) that the complaint made before the police did not disclose a cognizabIe offence and as such the police was not empowered to investigate the complaint. HELD: (i) In view of the scheme of sections 2 and 3 of the Act and the judgment of this Court in Ch. Tika Ramji 's case the contention that food crops were outside the purview of section 3 of the Act must be rejected. [675 B G] Ch. Tika Ramji & Ors. vs State o/U.P. & Ors. , applied. (ii) The power sought to be exercised in the present case was not implied one for sub rule (3) of rule 3 gives a specific mandate that unless there is an agreement in writing to the contrary between the parties the purchaser shall pay to the seller the price of the sugarcane purchased within 14 days. [676 G H] 674 Even if the Bihar Sugar Factories Control, Act, 1937 provides anything to the contrary it must be held to have been altered by a competent authority namely Parliament, under Art, 372 of the Constitution. [677 A B] (iii) Parliament was competent to enact the and to confer power on the Government under section 3 of the Act as Entry 33 of List III of the Constitution empowers Parliament to legislate in respect of production, supply and distribution of foodstuffs. [677 C D] (iv) There was no contravention of article 19(1) because no fundamental right is conferred on a buyer not to pay the price of the goods purchased by him or to pay the same whenever he pleases. [677 E] (v) The plea based on section 11 of the Act was premature because no ,court had yet taken cognizance of the case. [677 F] (vi) The offence complained of was punishable with three years ' imprisonment and fell within the 2nd Schedule of the Code of Criminal Procedure. It was therefore a cognizable offence as defined in section 4(1)(f) of the Code. [677 G]

Civil Appeal No. 150 of 1963. Appeal by special leave from the judgment and decree dated January 9, 1962 of the Calcutta High Court in Appeal from Original Decree No. 48 of 1961. N.C. Chatterlee, R.K. Garg, S.C. Agarwal, M.K. Rarnatnurthi and D.P. Singh, for the appellant. M.C. Setalvad and B.P. Maheshwari, for the respondent. October 10, 1963. The Judgment of the Court was delivered by RAGHUBAR DAYAL J. Raj Kishore Tewari, appellant in this appeal by special leave, was occupying certain premises as sub tenant of Susil Chandra Banerjee, under a registered lease dated April 10, 1954. His tenancy commenced from April 1, 1954. The rent fixed was Rs. 220 per mensem. Subsequent 123 ly it was reduced to Rs. 205 by an agreement dated June 9, 1954. The tenancy was monthly. Susil Chandra Banerjee was the tenant of Govindaram Bhansali from September 15, 1943, at a monthly rental of Rs. 153 plus certain other charges. On June 16, 1955, the landlord obtained a decree of ejectment against Susil Chandra Banerjee. In view of sub section (2) of section 13 of the West Bengal Premises Rent Control (Temporary Provisions) Act, 1950 (Act XVII of 1950), hereinafter called the Act, the appellant became the tenant of the landlord after the determination of the tenancy of Susil Chandra Banerjee. On March 19, 1957, the land lord respondent gave a notice to the appellant asking him to deliver possession of the premises on the expiry of the last day of April 1957, on the ground that he, being the statutory tenant, had not paid rents to him since June 16, 1955, and, as such, was not entitled to any protection under the West Bengal Premises Tenancy Act, 1956 (Act XII of 1956). Subsequently, on June 10, 1957, the respondent instituted the suit for ejectment of the appellant from the premises. The suit was resisted by the appellant on various grounds. His defence was however struck off due to certain default. Ultimately, the suit was decreed on December 15, 1959. An appeal to the High Court was unsuccessful. The High Court refused to give leave to appeal to this Court. Thereafter, the appellant obtained special leave from this Court and filed the appeal. The only point urged for the appellant is that the notice of ejectment dated March 19, 1957, was invalid in view of the fact that under the law the notice must be to require the appellant to deliver possession on the expiry of the month of tenancy, that the tenancy was from the 16th of a month as the decree for ejectment against the tenant of the first degree was passed on June 16, 1955, and that this notice required the delivery of possession on the expiry of the last day of April. We may say that this point was not raised in the written statement. It was however allowed to be raised in the appellate Court but was repelled. 124 The only point to determine in this appeal is the date from which the tenancy of the appellant vis a vis the respondent commenced. The relevant portion of sub s.(2) of section 13 of the Act is: "(2) Where any premises or any part thereof have been or has been sub let by 'a tenant of the first degree ' or by a tenant inferior to a tenant of the first degree ', as defined in explanation to sub section (1), and the sub lease is binding on the landlord of such last mentioned tenant, if the tenancy of such tenant in either case is lawfully determined otherwise than by virtue of a decree in a suit obtained by the landlord by reason of any of the grounds specified in clause (h) of the proviso to sub section (1) of section 12, the sub lessee shall be deemed to be a tenant in respect of such premises or part, as the case may be, holding directly under the landlord of the tenant whose tenancy has been determined, on terms and conditions on which the sub lessee would have held under the tenant if the tenancy of the latter had not been so determined. " There is nothing in these provisions which should persuade us to hold, as urged for the appellant, that the sub tenant becomes a tenant of the landlord from the date on which the tenancy of the tenant against whom a decree for ejectment is passed is determined. The provisions only lay down that the sub tenant would become the tenant of the landlord if the tenancy in chief is determined lawfully. On the other hand, this sub section lays down that the subtenant would be tenant on the terms and conditions on which the sub lessee would have held under the tenant if the tenancy of the tenant had not been determined. This means that the terms and conditions of the tenancy between the erstwhile sub tenant and the landlord continue to be the same which were the terms and conditions of the sub tenancy. Such terms and conditions of the tenancy in the case of the appellant were that he was to be a monthly tenant on the payment of a certain rent and that his tenancy was to 125 commence from the first day of April 1954. It is clear therefore that his tenancy was by the calendar month. It commenced on the first day of the month and expired on the last day of the month. This period of monthly tenancy was in no way affected by the provisions of sub section (2) of section 13 whose effect was simply this that the sub tenant instead of being sub tenant of the tenant who had been ejected, got a direct connection with the landlord and became his tenant in chief or, as the Act describes, tenant in the first degree. The statutory provision just brought about a change in the landlord of the sub tenant. The proprietor landlord took the place of the tenantin chief from whom the sub tenant had secured the tenancy. We are therefore of opinion that the High Court was right in rejecting the contention of the appellant with respect to the invalidity of the notice for ejectment dated March 19, 1957. The result is that the appeal fails and is dismissed with costs. Appeal dismissed.

The appellant was a sub tenant of S on a monthly basis commencing from April 1, 1954. S was the tenant of the Respondent from September 15, 1943 on a monthly rental. On June 16, 1955, the respondent obtained a decree of ejectment against section In view of sub s(2) of section 13 of the West Bengal Premises Rent Control (Temporary Provisions) Act, 1950, the appellant became the tenant of the respondent after the determination of the tenancy of section The respondant gave a notice to the appellant asking him to deliver possession of the premises on the expiry of the last day of April 122 1957, since he being a statutory tenant had not paid rent since June 16, 1955. The respondant instituted a suit for ejectment, which was decreed, and an appeal to the High Court by the appellant was unsuccessful. On appeal by special leave, it was contended that the notice was invalid for under the law the notice must be to require the appellant to deliver possession on the expiry of the month of tenancy, that the tenancy was from the 16th of a month as the decree for ejectment against S was passed on June 16, 1955 and that this notice required the delivery of possession on the expiry of the last day of April. Held: The contention was untenable and rightly rejected by the High Court. The provisions of Sub section (2) of section 13 of the West Bengal Rent Control (Temporary Provisions) Act, 1950 only lay down that the sub tenant would become the tenant of the landlord if the tenancy in chief is determined, on the same terms and conditions on which the sub lessee would have held under the tenant if the tenancy of the tenant had not been determined. This means that the terms and conditions of the tenancy between the erstwhile sub tenant and the landlord continue to be the same which were the terms and conditions of the sub tenancy. The period of monthly tenancy commencing from the first of the month and expiring on the last day of the month, was in no way affected by the provisions of Sub section (2) of section (13) whose effect was simply that the sub tenant instead of being sub tenant of the tenant who had been ejected, got a direct connection with the landlord and became his tenant in chief.

Civil Appeal No. 1844/1975. (Appeal by special leave from the judgment and order dated the 17 7 1974 of the Allahabad High Court in special appeal No. 121 of 1974) R. N. Trivedi and O. P. Rana, for the appellants. section C. Aggarwal and V. J. Francis, for the respondent. The Judgment of the Court was delivered by BEG, J. This appeal by special leave granted to the Regional Manager of U.P. State Road Transport Corporation, Allahabad, challenges the findings of a learned single Judge, affirmed by a Division Bench of the Allahabad High Court holding that the respondent, Pawan Kumar Dubey, was reverted from the post of a Senior Station Incharge, in which he was officiating, to his substantive post of a Junior Station Incharge by means of an order dated 20 2 1973 passed as a measure of punishment inflicted upon him for alleged misconduct indicated by an adverse entry communicated to him by a letter dated 25th January, 1973. His juniors, it was found, were still officiating in posts of Senior Station Incharge. The respondent 's chances of promotion were said to be adversely affected by the reason given for the reversion in the impugned order: that the respondent was "not fit yet" for the higher post. The learned single Judge and the Division Bench in the Allahabad High Court were referred to several decisions of this Court mentioned by the Division Bench These were: State of Bombay vs F. A. 542 Abraham(1); Champaklal Chimanlal Shah vs Union of India(2) Divisional Personnel Officer vs Raghavendrachar(3); and State of U.P. & Ors. vs Sughar Singh(4). The Allahabad High Court had followed what it considered to be the ratio decidendi of Sughar Singh 's case (supra), the last case of this Court available at the time. Special leave to appeal was sought in the case before us on the ground that Sughar Singh 's case (supra) had been misunderstood by the High Court and required some elucidation by this Court. Special leave was granted on condition that, in any event, the costs of the respondent will be borne by the appellants. The question to be determined was assumed to be one of law only. The appeal was, therefore, to be heard on the special leave paper 'Book with such additional documents from the record of the case as the parties may choose to file. We find that, although a number of documents were filed, neither side has chosen to file a copy of the order impugned which has been interpreted by the single Judge as well as by the Division Bench of the Allahabad High Court as one amounting to award of a punishment not merely in the light of the circumstances preceding the order but also from the terms of the order itself and its effect upon the respondent 's future. The question, therefore, arises whether we really have before us any point of law of such a nature as to justify interference in exercise of the exceptional powers of this Court under article 136 of the Constitution. Even though we have come to the conclusion that the question before us is substantially one of fact, we would like to explain a little the law applicable to such cases in view of the submission that Sughar Singh 's case (supra) had led to some misunderstanding of it. Not much clarification seems necessary so far as conditions for the application of Article 311(2) are concerned as this question has been considered and decided by this Court in a number of cases including the recent decision by a bench of seven Judges of this Court in Shamsher Singh & Anr. vs State of Punjab (5). It was pointed out in that case (at p. 937): "No abstract proposition can be laid down that where the services of a probationer are terminated without saying anything more in the order of termination than that the services are terminated it can never amount to a punishment on the facts and circumstances of the case. If a probationer is: discharged on the ground of misconduct, or, inefficiency, or for similar reason, without a proper enquiry and without his getting a reasonable opportunity of showing cause against his discharge, it may, in a given case, amount to removal from service within the meaning of Article 311(2) of the Constitution." (1) ; (2) [1964](5) S.C.R. 190. (3) ; (4) ; (5) 543 Shamsher Singh 's case (supra) related to an order of termination of services of a probationer which, on the face of it, appeared to be innocuous. Nevertheless, this Court, after examining the facts and circumstances constituting the background of the order and its consequences, held it to be substantially one of punishment and set it aside for a violation of Article 311(2) of the Constitution. It was explained there (at p. 837): "Before a probationer is confirmed, the authority concerned is under an obligation to consider whether the work of the probationer is satisfactory or whether he is suitable for the post. In the absence of any Rules governing a probationer in this respect the authority may come to the conclusion that on account of inadequacy for the job or for any temperamental or other reason not involving moral turpitude the probationer is unsuitable for the job and hence must be discharged. No punishment is involved in this. The authority may in some cases be of the view that the conduct of the probationer may result in dismissal or removal on an inquiry. But, in these cases, the authority may not hold an inquiry and may simply discharge the probationer with a view to giving him a chance to make good in other walks of life without a stigma at the time of termination of probation. If, on the other hand, the probationer is faced with an inquiry on charges of misconduct or inefficiency or corruption, and, if his services are terminated without following the perversions of Article 311(2), he can claim protection. In Gopi Kishore Prasad vs Union of India A.I.R. 1960 S.C., 689, it was said that if the Government proceeded against the probationer in the direct way without casting any aspersion on his honesty or competence, his discharge would not have the effect of removal by may of punishment. Instead of taking the easy course, the Government chose the more difficult one of starting proceedings against him and branding him as a dishonest and incompetent officer". It was also observed in Shamsher Singh 's case (supra) (at p. 838) "The fact of holding an inquiry is not always conclusive. What is decisive is whether the order is really by way of punishment. (See: State of Orissa vs Ramnarain Das ; If there is an enquiry, the facts and circumstances of the case will be looked into in order to find out whether the order is one of dismissal in substance (see: Modan Gopal vs State of Punjab (1963) 3 S.C.R. 716). In R. C. Lacy vs State of Bihar & ors. , (Civil Appeal No. 590 of 1962 decided on 23 October, 1963) it was held that an order of reversion passed following an enquiry into the conduct of the probationer in the circumstances of the case was in the nature of preliminary inquiry to enable the Government to decide whether disciplinary action should be taken. A probationer whose terms of service provided that it could be terminated without any notice and without any 544 cause being assigned could not claim the protection of Article 311(2). [See: R. C. Banerjee vs Union of India ; A preliminary inquiry to satisfy that there was reason to dispense with the services of a temporary employee has been held not to attract Article 311 [see. Champaklal C. Shah vs Union of India On the other hand, a statement in the order of termination that the temporary servant is undesirable has been held to import an element of punishment [See: Jagdish Mitter vs Union of India, A.I.R. 1964 S.C. 449]". We think that the principles involved in applying Article 311(2) having been sufficiently explained in Shamsher Singh 's case (supra) it should no longer be possible to urge that Sughar Singh 's case (supra) could give rise to some misapprehension of the law. Indeed, we do not think that the principles of law declared and applied so of have really changed. But, the application of the same law to the differing circumstances and facts of various cases which have come up to this Court could create the impression sometimes that there is some conflict between different decisions of this Court. Even where there appears to be some conflict, it would, we think, vanish when the ratio decidendi of each case is correctly understood. It is the rule deducible from the application of law to the facts and circumstances of a case which constitutes its ratio decidendi and not some conclusion based upon facts which may appear to be similar. One additional or different fact can make a world of difference between conclusions in two cases even when the same principles are applied in each case to similar facts. We have examined the record of the case of Sughar Singh (supra). our judgment in the case perhaps does not fully bring out the factual background on which the decision of that case was based. In that case, the Government servant concerned had been suspected of making an alteration in his own service record. It was not shown how he could possibly have had access to his service record as he was not in charge of the record. One of the alterations made meant an increase in his age so that he would, according to the altered state of the record, have had to retire earlier. Sughar Singh complained, when asked to show cause against the alleged tampering, that it must have been manipulated by his enemies interested in injuring him. It could not be determined who was responsible for the alterations. Nevertheless, the following adverse entry was made on Sughar Singh 's record: "1966 Is suspected to have got entries of date of birth and educational qualifications altered on the authority of a fictitious certificate which had to be corrected later on. Severely warned". Two years later, as a result of this entry based expressly on bare suspicion, without further inquiry into the question whether Sughar Singh could be responsible for tampering with the record, a reversion order, innocuous on the face of it, had been made on 12th August 1968. The effect of the reversion order was that Sughar Singh who, 545 apart from this entry, had an excellent record, was reverted from a post in which he had been officiating from 16th March, 1961, until the reversion order dated 12th August, 1968. It was shown that about 200 officers, junior to him, were still officiating in the cadre from which Sughar Singh had been reverted to his substantive post of Head Constable. No administrative need or exigency could be shown to justify the reversion order. All officers, including Sughar Singh, who had been officiating, had been selected after special training for the higher cadre. The question, naturally arose: Why was Sughar Singh selected for this discriminatory treatment ? A single Judge of the Allahabad High Court held, acting on the Principle that a mere reversion, from a post to which the incumbent had no right, did not amount to punishment within the meaning of Article 311(2) so that Sughar Singh had no remedy. He only took the for of the action into account. No further probe was considered necessary by the learned Judge. When the case came before a Division Bench, in special appeal, one of the learned Judges agreed with the learned single Judge who had dismissed Sughar Singh 's position merely on the ground that Sughar Singh had no right to the post without considering the impact of the surrounding facts or the background of the order. The other learned Judge, however, carefully examined the background of Sughar Singh and the reversion order as revealed by facts on record. He pointed out that the averments of Sughar Singh, that he had a splendid record, apart from the adverse entry in question, and that there was no inefficiency on his part, were not controverted in the counter affidavit filed. This learned Judge found the reversion order against Sughar Singh to be punitive. He, however, added that, even if the order could not be held to be punitive, it was certainly violative of the guarantee contained in Article 16(1) of the Constitution. When the matter was heard by Verma, C.J., on a reference occasioned by the difference of opinion between the two learned Judges on the Division Bench, it was again argued that both Articles 16(1) and 311(2) had been infringed. The learned Chief Justice did not find sufficient material to uphold a violation of Article 16. But, after taking into account the admission of the Counsel appearing for the State that the sudden reversion of Sughar Singh could not at all be explained or accounted for unless it could be linked with the adverse entry, the learned Chief Justice held the action against Sughar Singh to be punitive and violative of Article 311(2) of the Constitution. Sughar Singh had been held to have been punished for nothing beyond what had taken place two years before the reversion order so that it could not have been justly or reasonably connected with the delayed action based upon it. This Court could have dismissed the appeal by special leave solely on the ground that no question of law arose on the finding of fact, also upheld by this Court that Sughar Singh was punished, in substance, so that Article 311 (2) was attracted. This Court 's judgment in Sughar Singh 's case (supra) shows that it was only following the law on Article 311(2) of the Constitution as laid down repeatedly earlier by this Court. It specifically referred to 546 the following cases: Purshotam Lal Dhingra vs The Union of India(1); State of Punjab & Anr. vs Sukh Rai Bahadur(2); State of Orissa vs Ram Narayan Das(3); B. C. Lacy vs State of Bihar(4); Jagdish Mitter vs Union of India(5); A. G. Benjamin vs Union of India(6); Ram Gopal Chaturvedi vs State of Madhya Pradesh(7); Union of India vs Gajendra Singh(8); Divisional Personnel Officer vs Raghavendrachar (supra); Union of India vs Jaswan Ram (9); Madhav vs State of Mysore(10); State of Bombay vs Abraham (supra),. In Sughar Singh 's case, this Court summarised the propositions of law deducible from the cases mentioned above; and, while considering the applicability of some of the propositions of law to the facts of the case, it did observe that, on the face of it, the action against Sughar Singh did not appear to be punitive. Nevertheless, on a total consideration of all the facts, including the admission in the High Court before Verma, C.J., by the Standing Counsel appearing on behalf of the State, that the reversion order could not be explained except as a result of the adverse entry made two years earlier, it had finally applied the ratio decidendi of the State of Bihar & Ors. vs Shiva Shukshuk Mishra(11), where this Court had affirmed the opinion of the High Court, on facts, that the "reversion was not in the usual course or for administrative reasons but it was after the finding on an enquiry about some complaint against the plaintiff and by way of punishment to him". On this view of the case, it was not really necessary for this Court to consider whether the reversion of Sughar Singh was contrary to the provisions of Article 16 also. Nevertheless, this Court held there, alternatively, after referring to State of Mysore vs P. P. Kulkarni (19), that the action taken against Sughar singh also resulted in a violation of the provisions of Articles 14 and 16 of the Constitution. It seems to us to be clear, after examining the record of Sughar Singh 's case (supra), that what weighed with this Court was not only that there was a sufficient "element of punishment" in reverting Sughar Singh: for a supposed wrong done, from which the order of reversion could not be divorced, so that Article 311(2) had to be complied with, but, there was also enough of an impropriety and unreasonableness in the action taken against Sughar Singh, solely for a very stale reason, which had become logically quite disconnected, to make out a case of "malice in law" even if it was not a case of "malice in fact". If an authority acts on what are, justly and logically viewed, extraneous sounds, it would be such a case. All these aspects of the case were kept in view. by this Court when it recorded the conclusion: "In this view of the matter, we have no doubt that the order was passed by way of punishment, though all outward indicia show the order to be a mere order of reversion. Even if it were not so, we have no doubt that the order would be (1) ; (2) (3) [1961](1) S.C.R. 606. (4) C.A. No. 590 of 1962 decided on 23 10 63. (5) A.I.R. 1964 S.C. 449. (6) C.A. No. 1341 of 1966 decided on 13 12 66. (7) [1970](1) S.C.R. 472. (8) [1972](3) S.C.R. 660. (9) A.I.R. 1958 S.C. 905. (10) A.I.R. 1962 S.C. 811. (11) [1971](2) S.C.R.191 (12) A.I.R. 1972 section C. 2170. 547 liable to be quashed on the ground of contravention of Articles 14 and 16 of the Constitution". We do not think that Sughar Singh 's case, in any way, conflicts with what has been laid down by this Court previously on Article 311(2) of the Constitution or Article 16 of the Constitution. We would, however, like to emphasize that, before Article 16 is held to have been violated by some action there must be a clear demonstration of discrimination between one Government servant ' and another, similarly placed, which cannot be reasonably explained except on an assumption or demonstration of "malice in law" or "malice in fact". As we have explained, acting on a legally extraneous or obviously misconceived ground of action would be a case of "malice in law". Orders of reversion passed as a result of administrative exigencies, without any suggestion of malice in law or in fact, are unaffected by Sughar Singh 's case (supra). They are not vitiated merely because some other Government servants juniors in the substantive rank, have not been reverted. This Court has held in section C. Anand vs Union of India(1), that no question of applying Articles 14 or 16 could arise where a termination of service takes place in terms of a contract of service. Again, in Champaklal Chiman Lal Shah (supra), this Court held that the motive behind an order of termination of service, in accordance with the terms of a contract, would not be really relevant even if an enquiry had been held to decide whether proceedings under Article 311(2) should be instituted or the services of a Government servant terminated in terms of his contract. Champaklal Chimanlal Shah 's case (supra was not one in which any question of mala fides arose. Protection of Article 16 was claimed there on the ground that Rule 5, providing for termination of services of temporary servants, was itself hit by Article 16. Such a contention was repelled. On the other hand, Kulkarni 's case (supra), relied upon in Sughar Singh 's case (supra), was one in which "misuse of power" or detournement de puvoir" (as it is called in French Administrative law), had been proved. Another term for such use of power for an improper object is "malice in law". We repeat that, before any such case of "malice in law can be accepted, the person who alleges it must satisfactorily establish it on proved or admitted facts as it was in Kulkarni 's case (supra). Where the allegations are of malice in fact, which are generally seriously disputed, and the case cannot be satisfactorily decided without a detailed adduction of evidence of cross examination of witnesses, Courts will leave the party aggrieved to an ordinary civil suit. This rule, relating to exercise of discretionary powers under Article 226, is also well settled. We have tried to gather, from such materials on the record of the case before us as have been made available to us by the parties, the spirit and substance", to use the expressions employed by this Court in Champaklal 's case e (supra), of the action taken against the contest (1) ; 548 ing respondent. We have examined the background of the order of reversion. We find that, on the one hand, there is fulsome praise, ill testimonials given to the respondent by his superior officers, for meritorious work done by him. On the other hand, we find that, preceding the order of reversion, passed on 20th February, 1973, against the respondent, there is a spurt of warnings and very vague complaints and adverse remarks of 30th September, 1972, and 4th October, 1972, 21st October, 1972, and 25th January, 1973, presumably all by a particular superior officer, alleging disrespect shown, disobedience to orders given, and aspersions said to have been cast by the respondent against the conduct of the superior officer. The respondent was warned by this superior officer, an Assistant General Manager, by a letter dated the 4th October, 1972. There is also a copy of an order on a complaint against the respondent that the respondent had misused the services of a Chowkidar. The detailed order of 2nd June, 1970, shows that, although, the complaint was dismissed by the General Manager, yet, he had admonished the respondent and had advised him to conduct himself more respectfully towards superior officers and to be "sweet tempered". There were some old adverse entries also against the respondent. But, they must be deemed to have been washed off by orders of his promotion, on an "ad hoc" or officiation basis, by an order of 7th March, 1972, which had been approved by the Deputy Transport Commissioner of Uttar Pradesh on 18th March, 1972, as required by the rules. It appears that the respondent had asked for particulars to meet the vague allegations of insubordination and disobedience which had found their way into his service record for 1972 to 1973. It has not been shown that the respondent was supplied with these particulars. He professed ignorance of occasions on which he had been disrespectful or of existence of any orders which had been disobeyed by him. These particulars could have been easily supplied to him if the allegations against him were justified The respondent 's representation against the last adverse entry, of the kind indicated above, made on 25th January, 1973, was pending when the reversion order of 20th February, 1973, was passed. His allegations that his juniors are still holding the posts in the cadre in which he was officiating and that there are no administrative reasons for his reversion are not controverted. In these respects, the facts of the case are similar to those of Sughar Sungh 's case (supra). In addition, as the High Court points out, the express condemnation of the respondent as "not fit" for the higher post, in which his juniors were allowed to officiate, categories him as inferior to his juniors even if it was qualified by the addition of the word "yet". The only possible justification which could be offered for this discriminatory treatment were the sudden adverse entries of 1972 73 against the respondent which were quite vague. If there had been anything really serious against the respondent, proceedings under Article 311 (2) of the Constitution should have been instituted. Indeed, they can still be taken if there are substantial grounds against the respondent. On the other hand, if the action against him is due merely to a feeling of pique or anger with him on the part of his superior officers, to which the respondent 's tactlessness 549 may have contributed, it did not deserve anything more than the warnings and the adverse entry. Indeed, even the bona fides of the last adverse entry becomes doubtful when we find that the respondent was not, despite his requests, given particulars of any facts upon which the conclusion that he was disrespectful or disobedient was based. To allege such misconduct against him and then to stigmatise the respondent as "not fit" for working in the higher post could appear, on the facts and circumstances of the particular case, to be more vindictive than just and fair. It may mar or delay his chances of promotion in future. We, however, refrain from commenting further on what may or may not have been the real cause of the respondent 's reversion. If the respondent is really unfit or inefficient, as compared with his juniors, there is no reason why, on a comparative assessment of merits, at a time when such assessment may be called for under the rules (there should be rules on the subject if there are none so far), his juniors in service should not be preferred over him. A decision given after fair comparisons with records of others officiating in the same cadre would have ensured that no violation of Article 16 took place. The sudden reversion of the petitioner, for the reason given in tile reversion order, could be held to amount to an unjustified stigma which could not be said to be "devoid of an element of punishment". As we have indicated, there is no magic formula or uniform set of facts which could convert even an apparently colourless or innocuous order into punitive or unjustifiably discriminatory action. It is, however, well established that even an apparently inoffensive order may fail to pass tested imposed by Articles 16 and 311 of the Constitution. Dealings of superior officers with their subordinates in Government service in a Welfare State must be shown to be based on fair play and reason when facts are actually proved which indicate that these requirements may be lacking. Even if the case before us could be one in which the High Court could have refrained from interfering, we do not consider it to be a fit case for invoking our jurisdiction under Article 136 of the Constitution. The High Court has only quashed an order of reversion which was detrimental to the respondent and was passed in violation of rules of natural justice. It did not give the respondent any other or consequential relief. And, as we have already indicated, it is still open for the authorities to proceed in a just and legal way against the respondent if there is really a substantial case against him deserving punitive action. As we are leaving the authorities free to take action, in accordance with either applicable rules for a comparative assessment of merits of 550 the respondent and others who may be eligible to officiate in the post of a Senior Station Incharge, or, to take disciplinary proceedings, it considered necessary no observation made that in this judgment or by the High Court will operate as a finding on any question except that the quashed reversion order was punitive and passed contrary to rules of natural justice embodied in Article 311(2). It is not necessary to invoke the aid of Article 16 of the Constitution at all on such a finding. This, we think, was also the position in Sughar) Singh 's case (supra) . This appeal is dismissed with costs. V.P.S. Appeal dismissed.

The respondent was reverted from the higher post in which he was officiating, to his substantive post, by an order which stated that he was 'not fit yet ' for the higher post. His juniors continued to officiate in the higher post. Till some time before the order of reversion, the respondent was praised by his superior officers, but, during a period of about six months before the reversion, there was a spurt of warnings, complaints, and adverse remarks, alleging disrespect, disobedience to orders, and that he cast aspersions on his superior officer. the respondent asked for particulars to meet the allegations, but they were not given to him. His representation against the last adverse entry was pending when the reversion order was passed. He challenged the order and the High Court, following State of U.P. vs Sughar Singh , quashed the order, holding that the reversion was a punishment in the light of the circumstances preceding the order, from the terms of the order, and its effect on the respondent 's future and that there was a violation of rules of natural justice. In appeal to this Court by special leave, the appellant contented that the High Court misunderstood Sughar Singh 's case. Dismissing the appeal, ^ HELL): (1) As the reversion order was punitive and passed contrary to the rules of natural justice embodied in article 311(2), it must be quashed. The authorities are, however, free to take action, either in accordance with applicable rules for a comparative assessment of the merits of the respondent and others who may be eligible, or to take disciplinary proceedings. [550A B] (a) In Sughar Singh 's case, this Court was only following the law on article 311(2) as laid down repeatedly. In that case also the reversion of Sughar Singh was apparently not punitive, but, since it could not be explained except as a result of an adverse entry made two years earlier, it was held to be by way of punishment. On this view it was not necessary to consider whether there was a violation of article 16, but this Court held that there was. What weighed with this Court was not only that there was a sufficient element of punishment in reverting him so that article 311(2) had to be complied with, but that there was also enough of impropriety and unreasonableness in the action taken solely for a very stale reason which had become logically disconnected and extraneous, to make out a case of 'malice in law ' if not 'malice in fact '. [545H 546F] (b) Whether an apparently innocuous order is punitive or amounts to unjustifiable discriminatory action violating either article 311 or article 16 depends on the facts of the case. [549E] (c) This Court has, in Shamsher Singh vs State of Punjab ; , laid down authoritatively the conditions necessary in such cases for the applicability of article 311(2) after considering all the previous cases and there is no scope for any misapprehension of the law. [544C] (d) As regards article 16, before it is held to have been violated, there must be discrimination between one Government servant and another, similarly placed. which cannot be reasonably explained except on the basis of 'malice in law ' or 'malice in fact '. But, the person who alleges such malice in law must 541 satisfactorily establish it on proved or admitted facts as in State of Mysore vs A Kulkarni (AIR When the allegations, are of 'malice in fact ' which are disputed and require a detailed adduction of evidence or examination of witnesses, the Court will leave the party aggrieved to an ordinary civil suit and will not exercise its discretionary power under article 226. Reversion of an officer as a result of administrative exigencies, without any suggestion of malice in law or in fact, is unaffected by Sughar Singh 's case, and is not vitiated even if some Government servants, junior to him, have not been reverted. [547B D, F G] (e) The facts of the present case are similar to those of Sughar Singh 's case and the High Court was right in holding that there was a violation of the principles of natural justice embodied in article 311(2). [548F G] There were no administrative reasons for the respondent 's reversion. If there had been anything really serious against him, proceedings under article 311(2) should have been instituted. The sudden reversion for the reason given in the order amounts to unjustified stigma which could not be said to be devoid of the element of punishment. [548G H, 549D L] (f) If he was really unfit as compared with his juniors there could have been a fair comparison with them at a time when such assessment is called for under the rules (rules should be made if there are none) and on such a comparative assessment of merits, the juniors could have been preferred ensuring that there was no violation of Act. Dealings of superior officers with their subordinates in Government must be shown to be based on fair play and reason. But it is not necessary to invoke the aid of article 16 to quash the order. [549 C D, E , 550B] (2) Even if the High Court should not have interfered, it is not a fit ease for interference by this Court under article 136, as it is still open to the authorities to proceed in a just and legal way against the respondent if necessary. [549F H]

Civil Appeal No. 1583 of 1987. From the Judgment and Order dated 22.4.1987 of the Madras High Court in W.A. No. 367 of 1983. G. Ramaswamy, Additional Solicitor General, P. Parmeshwaran, B. Parthasarthy for the Appellants. M.N. Krishnamani and section Balakrishnan for the Respondents. The Judgment of the Court was delivered by VENKATARAMIAH, J. The short question involved in this case is whether Para 620 of the Manual of Railway Pension Rules, 1950, (hereinafter referred to as the 'Railway Pension Manual ') under which the competent authority is empowered to retire a railway employee before his normal date of retirement is for any reason void, ineffective or unconstitutional. The respondent, R. Narasimhan, joined the Southern Railway as a Ticket Collector in the year 1950 and on being promoted at different stages he was working as a Travelling Ticket Examiner on 14th of May, 1982 when he was compulsorily retired from service by the competent authority in the Railway Administration in exercise of his powers under Para 2(2) of the Railway Ministry 's Letter dated 8.7.1950 (incorporated as Para 620 of the Railway Pension Manual). The respondent was born on 23.9.1929 and if the order of retirement had not been passed, as stated above, he would have continued in service till he completed 58 years of age. Aggrieved by the order of retirement, the respondent filed a Writ Petition in the High Court of Madras in Writ Petition No. 4079 of 1982 questioning the validity of the said 744 order and also of Para 620 of the Railway Pension Manual which empowered the Railway Administration to retire its employees on their completing 30 years of service. The Writ Petition was contested by the Railway Administration and ultimately it was dismissed by the learned Single Judge of the High Court of Madras. Aggrieved by the judgment of the learned Single Judge the respondent filed an appeal before the Division Bench of the High Court in Writ Appeal No. 367 of 1983. The Division Bench held that Para 620 of the Railway Pension Manual whose validity had been impugned in the Writ Appeal was void and ineffective and hence the order of retirement passed by the Railway Administration in exercise of the power conferred by the said para was liable to be set aside. Aggrieved by the judgment of the Division Bench, the Union of India and the Railway Administration have filed this appeal by special leave. In order to appreciate the contentions of the parties, it is necessary to set out the relevant rules governing the retirement of railway employees. Rule 2046 of the Indian Railway Establishment Code (hereinafter referred to as 'the Rules ') deals with compulsory retirement of railway servants. The relevant part of the said rule reads thus: "2046 (F.R. 56). (a) Except as otherwise provided in this rule, every railway servant shall retire on the day he attains the age of fifty eight years. . . . . . . . . (h) Notwithstanding anything contained in this rule, the appointing authority shall, if it is of the opinion that it is in the public interest to do so, have the absolute right to retire any railway servant giving him notice of not less than three months in writing or three months ' pay and allowances in lieu of such notice (i) if he is in Class I or Class II service or post and had entered Government Service before attaining the age of thirty five years, after he has attained the age of fifty years. (ii) in any other case after he has attained the age of fifty five years. (i) Any railway servant may by giving notice of not 745 less than three months in writing to the appointing authority retire from service after he has attained the age of fifty years if he is in Class I or Class II service or post and had entered Government service before attaining the age of thirty five years, and in all other cases after he has attained the age of fifty five years. . . . . . . . . (k) Notwithstanding anything contained in clause (h) the appointing authority shall, if it is of the opinion that it is in the public interest to do so, have the absolute right to retire a railway servant in Class III service or post who is not governed by any pension rules after he has completed thirty years ' service by giving him notice of not less than three months in writing or three months ' pay and allowances in lieu of such notice. " Para 620 of the Railway Pension Manual reads thus: "620(i). A Railway servant may retire from service at any time after completing 30 years ' qualifying service, provided that he shall give in this behalf a notice in writing to the appropriate authority, at least three months before the date on which he wishes to retire. . . . . . . . . (ii) The authority competent to remove the Railway servant from service may also require him to retire any time after he has completed 30 years ' qualifying service provided that the authority shall give in this behalf, a notice in writing to the Railway servant, at least three months before the date on which he is required to retire or three months ' pay and allowances in lieu of such notice. " There is no dispute that the respondent is governed by the pension rules as he has exercised his option to be governed by them. His contentions before the Division Bench were: (i) Rule 2046 of the Rules having been framed under the proviso to Article 309 of the Constitution and being a compendious code relating to a retired railway servant that provision alone could be invoked for the purpose of compulsory retirement and not para 620 of the Railway Pension Manual which is in 746 the nature of an executive order; (ii) Since rule 2046(h) of the Rules opens with a non obstante clause and para 620 of the Railway Pension Manual does not state that the said rule shall prevail notwithstanding any other provision to the contrary, rule 2046(h) of the Rules cannot be made subject to para 620 of the Railway Pension Manual; and (iii) there being two separate provisions with regard to compulsory retirement, namely clause (h) of rule 2046 of the Rules and para 620 of the Railway Pension Manual, in the absence of any guidance as to when and which rule could be invoked in a given case, both the provisions would be inapplicable and the respondent could not be compulsorily retired. A reading of the relevant part of rule 2046 of the Rules and para 620 of the Railway Pension Manual shows that ordinarily every railway servant has to retire on the date he attains the age of 58 years. Notwithstanding the said rule the appointing authority, if it is of the opinion that it is in the public interest to do so, has the power to retire any railway servant giving him notice of not less than three months in writing or three months ' pay and allowances in lieu of such notice, if he is in Class I or Class II service or post and had entered Government service before attaining the age of 35 years, after he has attained the age of 50 years and in any other case after he has attained the age of 55 years. Similarly a railway servant may by giving notice of not less than three months in writing to the appointing authority retire from service if he is in Class I or Class II service or post and had entered Government service before attaining the age of 35 years, after he has attained the age of fifty years, and in all other cases after he has attained the age of 55 years. These two kinds of retirement are dealt with in clauses (h) and (i) of rule 2046 of the Rules. The governing factor in clauses (h) and (i) of rule 2046 is the age of the employee concerned at the time when it is proposed to retire him from service or when he wishes to retire from service voluntarily as the case may be. This rule applies no doubt to all employees irrespective of the fact whether they are governed by the pension rules or not. Clause (k) of rule 2046 provides that notwithstanding anything contained in clause (h) the appointing authority shall, if it is of the opinion that it is in the public interest to do so, have the absolute right to retire a railway servant in Class III service or post who is not governed by any pension rules after he has completed thirty years ' service by giving him notice of not less than three months in writing or three months ' pay and allowances in lieu of such notice. Clause (1) of rule 2046 of the Rules provides that a railway servant in Class III service or post who is not governed by any pension rules, may by giving notice of not less than three months in writing to the appointing authority, retire from service after he has completed thirty years ' service. It may be noted that in clauses (k) and 747 (1) of rule 2046 of the Rules the governing factor is not the age of the railway servant concerned but the length of the qualifying service rendered by him. They are applicable only to a railway servant in Class III service who has completed 30 years of service in railway administration. If a railway servant in Class III service has entered the service during his 21st year he can be retired by the Government on his completing 30 years of service in his 51st year or he may elect to retire from service in his 51st year after completing 30 years of service by following the prescribed formalities. Clauses (k) and (I) of rule 2046, as already stated above, do not apply to railway servants who are governed by pension rules. Para 620 of the Railway Pension Manual, which is extracted above, contains provisions corresponding to clauses (k) and (I) of rule 2046 of the Rules. Under sub para (i) of para 620 a railway servant governed by the pension rules may retire from service at any time after completing 30 years of qualifying service provided that he has given a notice in writing to the appointing authority three months before the date on which he wishes to retire. Sub para (ii) of para 620 of the Railway Pension Manual, which corresponds to clause (k) of rule 2046 of the Rules, empowers the competent authority to remove a railway servant from service any time after he has completed 30 years of qualifying service provided that the authority has given in this behalf a notice in writing to the railway servant at least three months before the date on which he is required to retire or three months ' pay and allowances in lieu of such notice. It may also be noted that while clauses (k) and (1) of rule 2046 of the Rules apply only to a railway servant in Class III service or post not governed by any pension rules para 620 of the Railway Pension Manual applies to all railway servants governed by the pension rules. The Division Bench of the High Court has held that para 620 of the Railway Pension Manual was ineffective and invalid on the ground that it was `unable to see any logic or reason or any guidance for the purpose of invoking either one or other of the provisions ' and also has further observed thus: "In the circumstances therefore, particularly in view of the fact that the Railway Establishment Code is intended to govern the service conditions of all the individual railway servants and the Pension Rules are intended only to govern the determination of pension, and Rule 2046 itself is in a way of compendious rule relating to retirement at the age of 58 years and compulsory retirement earlier we are of the view that the case is governed by Rule 2046(h) only and not 748 by Rule 620 of the Pension Rules. This is also for the reason as rightly contended by Mr. N.C. Raghavachari, learned counsel for the appellant, that while Rule 2046(k) starts with saying that notwithstanding anything contained in Clause (h) there is no such non obstante clause in Rule 620, nor clause (h) of Rule 2046 is made subject to Rule 620. In the circumstances, therefore, it is open to the railway servant to contend that he is governed by Rule 2046(h) and not Rule 620. In the absence of any guiding principle specifically, it is not open to the Department to exercise an option either to invoke Rule 620 or clause (h) of Rule 2046. " Having observed thus, the Division Bench was of the view that since Rule 2046(h) of the Rules was not applicable, as the respondent had not attained the age of 55 years on the date when he was compulsorily retired, he could not have been compulsorily retired. We do not find any inconsistency between rule 2046 of the Rules and para 620 of the Railway Pension Manual. As already stated by us clause (h) of rule 2046 of the Rules empowers the competent authority to retire compulsorily a railway servant on his attaining the age specified therein. That clause has no reference to the length of service put in by a railway servant concerned. Clause (k) of rule 2046 of the Rules under which the appointing authority can retire a person in the public interest after a railway servant has completed 30 years of service applies to a railway servant holding a Class III post and who is not governed by pension rules. Para 620 of the Railway Pension Manual applies to all railway servants governed by the pension rules. Railway servants holding Class I or Class II posts who cannot be retired under clause (k) of rule 2046 of the Rules can be retired on their completing 30 years of qualifying service if they are governed by the pension rules. Similarly railway servants holding Class III posts and who are governed by the pension rules to whom clause (k) of rule 2046 of the Rules is not applicable can also be retired on their completing 30 years of qualifying service. Thus the area of operation of para 620 of the Railway Pension Manual is different from that of clause (h) and (k) of rule 2046 of the Rules. Para 620 of the Railway Pension Manual should be treated as supplementary to rule 2046 of the Rules. The said para which has been framed by the Union Government in exercise of its executive power under Article 73 of the Constitution should be given due effect since there is no statutory provisions or a rule framed under the proviso to Article 309 of the Constitution which is inconsistent with it. 749 We, therefore, overrule the view expressed by the Division Bench of the High Court on the above question and uphold the validity of para 620 of the Railway Pension Manual. Unfortunately, the case does not end here. It appears that the respondent had raised some other contentions with regard to the validity of the impugned order of retirement in the petition. But the Division Bench of the High Court has not expressed its opinion on those contentions since it agreed with the first contention urged on behalf of the respondent, namely, para 620 of the Railway Pension Manual was invalid. We are, therefore, constrained to send the case back to the Division Bench of the High Court to decide the other questions raised by the respondent. We, therefore, set aside the judgment passed by the Division Bench of the High Court and remand the case to the Division Bench of the High Court to dispose of the appeal afresh in the light of the submissions to be made by the respondent on the other contentions raised by him. The appeal is accordingly disposed of. There is no order as to costs. P.S.S. Appeal allowed.

Sub para (ii) of para 620 of the Railway Pension Manual empowers the competent authority to remove a railway servant from service any time after he has completed 30 years of qualifying service. Clause (h) of Rule 2046 (F.R. 56) of the Indian Railway Establishment Code empowers the appointing authority to retire in Public interest (i) Class I and Class II railway servant, who had entered Government Service before the age of 35 years, after he has attained the age of fifty years, and (ii) in any other case after he has attained the age of 55 years. Clause (k) of the said rule confers absolute right on the appointing authority to retire a railway servant in Class III service, who is not governed by the Pension Rules, after he has completed thirty years of service. The respondent, Class III servant, who had joined service in 1950 was compulsorily retired from service by the competent authority in the Railway Administration in exercise of powers under para 620 of the Manual on 14th May, 1982. He was born on 23.9.1929 and was to continue in service till he completed 58 years of service. The writ petition filed by him questioning the validity of the said order and also of para 620 of the Manual was dismissed by the Single Judge. In appeal before the Division Bench it was contended for him that (i) Rule 2406 of the Rules having been framed under the proviso to Article 309 of the Constitution and being a compendious code with regard to compulsory retirement that provision alone could be invoked and not para 620 of the Manual which is in the nature of an executive 742 order, (ii) since rule 2046(h) opens with a non obstante clause and para 620 of the Manual does not state that the said rule shall prevail notwithsanding any other provision to the contrary, rule 2046(h) of the Rules cannot be made subject to para 620 of the Manual, and (iii) there being two separate provisions with regard to compulsory retirement, namely clause (h) of rule 2046 of the Rules and para 620 of the Manual, in the absence of any guidance as to when and which rule could be invoked in a given case, both the provisions would be inapplicable and he could not be compulsorily retired. The High Court held that para 620 of the Railway Pension Manual was void and ineffective. It took the view that since rule 2046(h) of the Rules was not applicable, as the respondent had not attained the age of 55 years on the date he was compulsorily retired, he could not have been compulsorily retired. Allowing the appeal by special leave and remanding the case to the High Court, ^ HELD: 1.1 Para 620 of the Railway Pension Manual is valid. The High Court was not right in taking the view it did. [749A] 1.2 There is no inconsistency between rule 2046 of the Rules and para 620 of the Railway Pension Manual. Clause (h) of rule 2046 of the Rules empowers the competent authority to retire compulsorily a railway servant on his attaining the age specified therein. That clause has no reference to the length of service put in by a railway servant concerned. Clause (k) of the said rule under which the appointing authority can retire a person in the public interest after a railway servant has completed 30 years of service applies to a railway servant holding a Class III post and who is not governed by pension rules. Para 620 of the Manual applies to all railway servants governed by the pension rules. Railway servants holding Class I or Class II posts who cannot be retired under clause (k) of rule 2046 of the Rules can be retired on their completing 30 years of qualifying service if they are governed by the pension rules. Similarly, railway servants holding Class III posts and who are governed by the pension rules to whom clause (k) of rule 2046 of the Rules is not applicable can also be retired on their completing 30 years of qualifying service. Thus, the area of operation of para 620 of the Railway Pension Manual is different from that of clauses (h) and (k) of rule 2046 of the Rules. [748D G] 1.3 Para 620 of the Railway Pension Manual which has been framed by the Union Government in exercise of its executive power under Article 73 of the Constitution should, therefore, be treated as supple 743 mentary to rule 2046 of the Rules, and given due effect since there is no statutory provision or a rule framed under the proviso to Article 309 of the Constitution which is inconsistent with it. [748G H] 2. Since the respondent had raised some other contentions with regard to the validity of the impugned order of retirement in the petition and the High Court has not expressed its opinion on those contentions, the case is remanded to the Division Bench of the High Court to dispose of the appeal afresh in the light of the submissions to be made by the respondent on the other contentions raised by him. [749C]

ON: Criminal Appeal No. 170 of 1956. Appeal by special leave from the judgment and order dated June 14, 1954, of the Calcutta High Court in Criminal Appeal No. 13 of 1954, arising out of the Judgment and order dated January 13, 1954, of the said High Court in Case No. 55 of 1953. Purshottam Tricumdas, H. J. Umrigar and B. P. Maheshwari, for the appellants. N. C. Chatterjee, R. L. Anand and D. N. Mukherjee, for respondent No. 1. A. C. Mitra, A. M. Pal and P. K. Bose, for respondent No. 2. 1960. February 12. The Judgment of section K. Das and Sarkar, JJ., was delivered by section K. Das, J. Hidayatullah, J., delivered a separate Judgment. section K. DAS J. This is an unfortunate case in more than one sense. So far back as August 11, 1950, there was some incident in premises No. 18, Bondel Road in Calcutta in the course of which one Col. section C. Mitra, a Gynaecologist and Surgeon, lost his life. Mitra was the husband of petitioner No. 1 and father of petitioner No. 2. In connection with the Colonel 's death, Sunil Chandra Roy, at present respondent No. 1, and his two brothers were placed on their trial for offences under sections 302, 323 and 447 of the Indian Penal 3 Code. Very shortly put, the case against them was that they had trepassed into 18, Bondel Road, following upon a quarrel regarding the supply of water to premises No. 17, Bondel Road which belonged to petitioner No. 2 and consisted of several flats one of which on the second floor was in occupation of Sunil as a tenant; that they had attacked Col. Mitra and petitioner No. 2; that Sunil had inflicted a blow or blows on the Colonel which caused his death and that one of his brothers Satyen had inflicted some minor injuries on the person of petitioner No. 2. There was also a charge against Sunil for an assault alleged to have been committed on Mrs. Sati Mitra, Wife of petitioner No. 2. The accused persons were, in the first instance, tried by the Additional Sessions Judge of Alipur with the result that Sunil was convicted under sections 325 and 447 and Satyen under sections 323 and 447, Indian Penal Code. So far as the third brother Amalesh was concerned, his case was referred to the High Court as the learned Judge did not agree with the jury 's verdict of not guilty. Sunil and Satyen appealed to the High Court against their convictions and sentences; the State of west Bengal obtained a Rule for enhancement of the sentences passed on Sunil and Satyen. The appeal, the Rule and Reference were heard together. The appeal was allowed, and the High Court of Calcutta directed that Sunil and Satyen be retried at the Criminal Sessions of the High Court. The Reference in respect of Amalesh was rejected and the Rule for enhancement of the sentences passed necessarily fell through. Sunil and Satyen were then tried at the Criminal Sessions of the High Court by Mitter, J., with the aid of a special jury. The jury unanimously found Sunil guilty under sections 325 and 447, and Satyen under sections 323 and 447, Indian Penal Code. The learned Judge accepted the verdict and sentenced both Sunil and Satyen to various terms of imprisonment and fines. An appeal was then preferred by Sunil and Satyen. This appeal was again allowed, and another retrial was directed at the Criminal Sessions of the High Court. 4 The retrial was held by P. B. Mukherjee, J. Before the commencement of the trial, the State withdrew the case against Satyen on the ground of the state of his health. Therefore, Sunil alone was tried, and the charges against him at the third trial were two in number: one under section 325 Indian Penal Code for vountarily causing grievous hurt to Col. Mitra and the other under section 447 Indian Penal Code for criminal trespass into premises No. 18, Bondel Road with intent to intimidate, insult or annoy Col. Mitra or his son Nirmal, petitioner No. 2 herein. This time the jury, by a majorit verdict of 7 to 2, found Sunil not guilty of the charge under section 325 Indian Penal Code ' and, by a majority of 6 to 3, found him not guilty of the other charge also. The learned Judge accepted the verdicts and acquitted Sunil. Then, the State of West Bengal preferred an appeal to the High Court against the order of acquittal, but the High Court summarily dismissed it on June 14, 1954, on the ground that no case had been made out for the admission of the appeal under the provisions of section 411A(2) of the Code of Criminal Procedure. Then, on July 22, 1954, the petitioners herein made an application to the High Court for a certificate under Article 134(1) (c) of the Constitution that the case is a fit one for appeal to the Supreme Court, and the grounds alleged in support of the application substantially were (1) that in his charge to the jury, the learned Judge had failed to marshall and sift the evidence properly so as to give such assistance as the jury were entitled to receive ; (2) that the learned Judge had misdirected the jury on several points, both with regard to the evidence of the eye witnesses and the evidence of medical experts; (3) that the learned Judge did not properly explain the law relating to the charges; (4) that he admitted inadmissible evidence and shut out evidence which was admissible and this had vitiated the verdict of the jury; and (5) that the learned Judge had not dealt with the prosecution and defence versions in the same way and by the same standard and bad been guilty of various non directions which resulted in a manifestly erroneous verdict. This application was dismissed by the 5 High Court on July 26, 1954, mainly on two grounds: (1) the petitioner had no locus stand to maintain an application for leave to appeal to the Supreme Court, and (2) no appeal lay under Article 134 of the Constitution from an order of acquittal. The High Court then said: " In view of the opinion we have formed as regards the competence of the present application, it is not necessary for us to say anything on the merits, but for the sake of completeness we shall observe that the grounds which have been set out in the petition are all grounds which had been taken in the appeal preferred by the State and we did not think then and do not think now that those grounds would justify us in either admitting the appeal from the order of acquittal or giving leave to appeal from our order to the Supreme Court. " The petitioners then applied for special leave from this Court under Article 136 of the Constitution and substantially pleaded the same grounds some of which were elaborated by examples given which they had pleaded when asking for a certificate from the High Court. This Court granted special leave on February 20, 1956, and the present appeal has come to us in pursuance of the special leave granted by us. In view of the special leave granted, the two questions dealt with by the High Court in its order dated July 26, 1954, no longer require any consideration. The principal question for consideration now is whether the charge to the jury at the third trial is so defective that it has led to a manifestly erroneous verdict, resulting in a failure of justice. Therefore we intimated to learned counsel for the parties that the arguments should be confined at this stage to that question, and if counsel for the petitioners satisfied us that the charge was so defective on the grounds alleged, then the further question as to whether the case should be remitted to the High Court or dealt with in this Court on the evidence already recorded, would arise. We proceed now to consider the principal question before us. But before we do so, it is necessary perhaps to give a few more details of the prosecution case and the defence. 6 Col. Mitra was the owner of 18, Bondel Road, but he did not live in that house. He had his chambers on the ground floor of 18, Bondel Road. His son Nirmal lived at 18, Bondel Road with his wife. Just by the side of 18, Bondel Road and west of it was No. 17, Bondel Road one of the flats of which was in occupation of Sunil as a tenant. It was alleged that the relation between landlord and tenant was not good and there were proceedings between the two before the Rent Controller. An order made in these proceedings reduced the rent payable by the tenants and fixed certain specific hours during which the pump for water supply was to be worked. The prosecution case was that on August 10, 1950. Mitra came to spend the night with Nirmal and was put up in the easternmost bed room on the first floor. The building had three rooms on the first floor all facing south, and the westernmost room was used by Nirmal as his bed room. The intermediate room was a drawing room and had a telephone in it. According to the prosecution case, in the early morning on the 11th August, 1950, Nirmal was still in bed when he was roused by the noise of a row and recognising the voice of Sunil, he slightly opened the leaves of one of the windows to see what was happening. He found that Sunil amongst others, was standing at the window, shouting abuse at Purna Mali (the gardener who was in charge of the pump) for not getting water which was followed up by further abuse of Nirmal. After that Sunil disappeared from the window. Nirmal 's wife had been up before Nirmal, and already served tea to Colonel Mitra and she came into the room when Nirmal was listening to the abuses. She came to call him, that is, Nirmal, to join his father at tea, and went back to the Colonel. Nirmal was greatly alarmed at what he had seen and heard, and passing into the drawing room sent a telephone message to the Karaya Police Station asking for help. While Nirmal was still speaking on the telephone, his wife Mrs. Sati Mitra ran into the room and said that Sunil and his two brothers who were also tenants at 17, Bondel Road, had already entered the compound of 18, Bondel Road and his father, the Colonel, had gone down. Nirmal 7 who was telephoning the police hurriedly added a request to the police to come soon. Nirmal coming down found Purna Mali in the grasp of Amalesh, and Colonel Mitra was standing underneath the porch at 18 Bondel Road and remonstrating with Sunil and his brother. Nirmal immediately ordered accused Sunil and his brothers to get out of the house whereupon Satyen and Amalesh, fell upon Nirmal. This led the Colonel to remonstrate again whereupon the Colonel was attacked by Sunil who caught hold of the Colonel by the neck of his vest and began to drag him towards the Bondel Road, along the passage to the gate at 18, Bendel Road. The building at l8, Bondel Road faces south, has a lawn to its south alongside which runs a passage to the gate, and near the western pillar of the gate there is a masonry letter box built in the compound wall. To the south of the lawn there is a row of tube roses through which there is an opening leading into the lawn. According to the prosecution case, as Sunil started dragging the Colonel towards the road and the gate, Nirmal ordered the Mali to close the gate. Accused Sunil dragged the Colonel, according to the prosecution case, and while near the Durwan 's room Sunil dealt a fist blow on the left temple of the Colonel. The prosecution case further was that Sunil proceeded to drag the Colonel past the western pillar of the gate and then through the opening among the plants in the lawn and there he struck a blow on the left forehead of the Colonel with a rod like object. On receiving the blow, the Colonel dropped down and fell on his back on the lawn. Thereupon Sunil stepped on to the letter box, scaled the wall and hurriedly made his escape. Two neighbours, Jiban Krishna Das and Suku Sen, then came by scaling into the compound of No. 18, and with their help and with the help of the servants of the family, the Colonel 's body was removed to the verandah on the ground floor of 18, Bondel Road and placed on a " charpoi". Nirmal was one of the persons who carried the body of his father, the Colonel. Jiban had a car with him and was asked to. rush for a doctor which he. did and within a few minutes brought Dr. Sachin Bose who examined the 8 Colonel and found him already dead. On receipt of the telephone message from Nirmal, Pushpa Pal, Officer in charge, Karaya Police Station, deputed a, Head constable named Mathura Singh, to go to No. 18 but when the constable arrived, the incident was over. The Officer in charge, Pushpa Pal, soon followed and after obtaining from Nirmal a brief oral statement as to his version of the incident, proceeded to No. 17, Bondel Road. On the staircase of the house at No. 17, Bondel Road, Puspha Pal met one Sarat Banerji, said to be a priest of a neighbourhood called Shitalatala. Pushpa Pal then went up and arrested the accused Sunil. The postmortem examination of the Colonel 's body revealed that he had sustained a linear fracture of his left temporal bone, vertical in character, an abrasion laid obliquely across the middle of the left half of his forehead, a lacerated wound bone deep laid vertically across the middle of the eye brow, an abrasion on the left cheek and one small lacerated wound near the left ear. There was some clotted blood on the top of the membrane over the fracture of the bone and some on the inner surface of the scalp. In the opinion of Dr. Majumdar who carried out the postmortem examination as recorded in his report, the death of the Colonel was due to shock caused by the head injury, on top of senile changes, and the head injury, which was ante mortem must have been caused by a fall on some hard substance. The postmortem report was not signed till the 2nd September, 1950, and not until the pathological report and the chemical report had been obtained. The defence of Sunil was that he did not strike or assault the Colonel, either by a fist blow or a blow with a rod like substance. The defence further was that the fist blow on the left temple of the Colonel was not specifically mentioned by any material witness until after the postmortem report showed a linear fracture of the left temporal bone and it was suggested by the defence that the fist blow was invented to make a case that such blow fractured the left temporal bone of the Colonel. The main suggestion on behalf of the defence was that the Colonel 9 was an old man with heart trouble and his pathological condition was such that he was excited at the time of the incident and fell down on a rough surface, either on the passage or on the masonry letter box, and hurt himself. The injury was such that it could s not be caused by one blow of a rod or rod like substance. The defence against the charge of criminal trespass was that Sunil entered the compound of No. 18, Bondel Road at the invitation of Purna Mali, who asked Sunil to come and see if the pump was working, the pump being within the compound of No. 18, Bondel Road. Sunil did not, however, assault the Colonel in any way. It is in the context of the aforesaid two versions that we have to consider the charge to the jury and examine the criticisms made thereto. We must make it clear that we are not called upon at this stage to give our findings on any of the disputed questions of fact. That was the function of the jury, and the jury had given their verdict. The limited question before us is whether that verdict is vitiated by reason of any serious misdirection by the Judge or of any misunderstanding on the part of the jury of the law laid down by him, which in fact has occasioned a failure of justice. This Court said in Mushtak Hussein vs The State of Bombay (1) : "Unless therefore it is established in a case that there has been a serious misdirection by the Judge in charging the jury which has occasioned a failure of justice and has misled the jury in giving its verdict, the verdict of the jury cannot be set aside." In a subsequent decision, Ramkishan Mithanlal Sharma vs The State of Bombay (2) this Court observed that section 297, Criminal Procedure Code, imposed a duty on the Judge in charging the jury to sum up the evidence for the prosecution and defence and to lay down the law by which the jury were to be guided; but summing up for the prosecution and defence did not mean that the Judge should give merely a summary of the evidence; he must marshall the evidence so as to give proper assistance to the jury who are required to decide which view of the facts is true. This Court (1) ; at 815. (2) ; at 930. 10 referred with approval to the following observations made by the Privy Council in Arnold vs King Emperor " A charge to a jury must be read as a whole. If there are salient propositions of law in it, these will, of course, be the subject of separate analysis. But in a protracted narrative of facts the determination of which is ultimately left to the jury, it must needs be that the view of the Judge may not coincide with the view of others who look upon the whole proceedings in black type. It would, however, not be in accordance with usual or good practice to treat such cases as cases of misdirection, if, upon the general view taken, the case has been fairly left within the jury 's province. But in any case in the region of fact their Lordships of the Judicial Committee would not inter fere unless something gross amounting to a complete misdescription of the whole bearing of the evidence has occurred. " Bearing the aforesaid principles in mind, we proceed now to consider the criticisms made on behalf of the petitioners against the learned Judge 's charge to the jury. We had earlier classified the criticisms under five different heads, and we shall deal with them one by one. We shall refer to the main points urged under each head, avoiding a detailed reference to the evidence on minor points which do not advance the case of the petitioners any further. The first criticism is that the charge to the jury, read as a whole, is nothing but a summary of the evidence witness by witness and a summary of the arguments of counsel which the jury had already heard;. that the learned Judge did not state the points for decision under separate heads, nor did he collate and marshall the evidence topic wise so as to assist the jury to come to their conclusion one way or the other, but left the jury with a mass of unnecessary details which was more likely to confuse than to help them. Learned counsel for the petitioners has pointed out that in the appeal from the judgment of Mitter, J., in an earlier stage of this very case, (1) [1914] L.R. 41 I.A. 149. 11 Chakravarti, C. J., had said in Sunil Chandra Roy and Another vs The State (1): " But I feel bound to say that the function of a charge is to put the jury in a position to weigh and assess the evidence properly in order that they may come to a right decision on questions of fact which, under the law, is their responsibility. The charge must therefore address itself primarily to pointing out what the questions of fact are, what the totality of the evidence on each of the questions is, how the different portions of that evidence, lying scattered in the depositions of several witnesses, fit with one another, what issues or subsidiary questions they raise for decision and what the effect will be according as one part or another of the evidence is believed or disbelieved. " It was argued that what was condemned in an earlier stage of this case has happened again. We are unable to accept this line of criticisms as substantially correct. It is indeed, true that the learned Judge followed the method of placing the evidence witness wise rather than topic wise. He started his summing up by stating: " I now propose to take up the prosecution witnesses individually with a view to sum up the evidence of each witness and the suggestions made to each by the counsel for the accused." But the real point for consideration is not whether the learned Judge followed one method rather than another: the real point is did he properly discharge his duty under section 297, Criminal Procedure Code by giving the jury the help and guidance to which they were entitled ? Did he marshall the evidence in such a way as to bring out the essential points for decision and the probabilities and improbabilities bearing on the disputed questions of fact on which the jury had to come to their conclusion ? The learned Judge gave a lengthy charge to the jury; and in summing up the evidence of each witness, he did state the disputed points arising therefrom and their bearing on the main questions at issue, viz. whether Sunil had trespassed into 18 Bondel Road and had assaulted the Colonel in the manner alleged by the prosecution. (1) at 10001. 12 The length of the charge was due in part to a protracted narrative of facts and the many disputed questions of fact to which the attention of the jury had to be drawn. The principle laid down by the Privy Council in Arnold 's case (3) and accepted by this Court as correct is that it would not be in accordance with good practice to treat a case as a case of misdirection if, upon the general view taken, the case has been fairly left within the jury 's province, and this Court will not interfere unless something gross amounting to a complete misdescription of the whole bearing of the evidence has occurred. Learned counsel for the petitioners has taken us through the entire charge to the jury and while we may agree that some unnecessary details (e.g. how the spectacles of Mrs. Sati Mitra fell down) could have been avoided by the learned Judge, we are unable to say that the method followed by the learned Judge did not focus attention of the jury to the questions of fact which they had to decide or did not give help and guidance to the jury to arrive at their conclusion oes and as the accounts were kept on a mercantile basis, the amount of commission accrued as and when the sales took place and paragraph 5 of agreement was only a machinery for quantifying the amount. It was also argued that the Managing Agents by entering into an agreement with the Mills had voluntarily relinquished a portion of the amount of commission which had accrued to them and therefore the whole of the income from commission which had already accrued was liable to 55 income tax; and reference was made to the cases reported as Commissioner of lncome tax, Madras vs K. R. M. T. T. Thiagaraja Chetty and Co. (1), E. D. Sassoon & Company Ltd. vs The Commissioner of Income tax, Bombay City (2) and to an English case Commissioners of Inland Revenue vs Gardner Mountain & D ' Ambrumnil Ltd. (3). But these cases have no application to the facts of the present case. In the Commissioner of Income tax, Madras vs K. R. M. T. T. Thiagaraja Chetty & Co. (1), the assesses firm was, under the terms of the Managing Agency Agreement, entitled to a certain percentage of profits and in the books of the Company a certain sum was shown as commission due to the assessee firm and that sum was also adopted as an item of business expenditure and credited to the Managing Agents ' commission account but subsequently it was carried to suspense account by a resolution of the Company passed at the request of the assessee firm in order that the debt due by the Firm might be written off. The accounts were kept on mercantile basis and it was held that on that basis the commission accrued to the assessee when the commission was credited to the assessee 's account and subsequent dealing with it would not affect the liability of the assessee to income tax. It was also held that the quantification of the commission could not affect the question as it was not a condition precedent to the accrual of the commission. At page 267 Ghulam Hassan J., observed: " Lastly it was urged that the commission could not be said to have accrued, as the profit of the business could be computed only after the 31st March, and therefore the commission could not be subject to tax when it is no more than a mere right to receive. This argument involves the fallacy that profits do not accrue unless and until they are actually computed. The computation of the profits whenever it may take place cannot possibly be allowed to suspend their accrual. In the case of income where there is a condition that the commission will not be payable until the expiry of a definite period or the making up of the account, it might be (1) ; at 267. (2) ; , 344. (3) , 96. 56 said with some justification, though we do not decide it, that the income has not accrued but there is no such condition in the present case ". This passage does not help the appellant 's case. The question there decided was that the accrual of the commission was not dependent upon the computation of the profits although the question whether it would make any difference where the commission was so payable or was payable after the expiry of a definite period for the making of the account was left undecided . In the case before us the agreement is of a different nature and the above observations are not applicable to the facts of the present case. The next case is E. D. Sasoon & Co., Ltd. vs The Commissioner of Income tax, Bombay City (1). But it is difficult to see how it helps the case of the appellant. If anything it goes against his contention. In that case the assessee Company was the Managing Agent of several Companies and was entitled to receive remuneration calculated on each year 's profits. Before the end of the year it assigned its rights to another person and received from him a proportionate share of the commission for the portion of the year during which it worked as Managing Agent. On the construction of the Managing Agency Contract it was held that unless and until the Managing Agent had carried out one year 's completed service, which was a condition precedent to its being entitled to receive any remuneration or commission it was not entitled to receive any commission. The facts in that case were different and the question for decision was whether the contract of service was such that the commission was only payable if the service was for a completed year or the assessee Company was entitled to receive even for a portion of the year for which it had acted as a Managing Agent. It was held that it was the former. As was observed by Lord Wright in Commissioners of Inland Revenue V. Gardner, Mountain & D Ambrumenil Ltd. (2), " It is on the provisions of the contract that it must be decided, as a question of construction and therefore of law, when the commission was earned The contract in, the present case in para (1) ; , 344. (2) , 96. 57, graph 2 shows that (1) the company was to pay each year; (2) that the Managing Agents were to be paid 5 per cent. commission on the proceeds of the total sales of yarn and of all cloth sold by the Company or three pies per pound ' avoirdupois on the sale, whichever the Managing Agents chose; thus there was an ' option to be exercised at the end of the year; (3) they were also to be paid at 10 per cent. on the proceeds of sales of all, other materials; and (4) the Mills were to pay to the Managing Agents each year after December 31, or such other dale which the Directors of the Company may choon those questions. We are far less satisfied that anything amounting to a complete misdescription of the whole bearing of the evidence has occurred in this case. As to the observations which Chakravarti, C.J., had made, it is well to remember that they were made in respect of an earlier charge to the jury which, to use the words of the learned Chief Justice, was " all comment or mere comment in the main." Having carefully perused the present charge to the jury, we think, on a general view, that the case has been fairly left within the jury 's provinces in spite of the criticism so strenuously made that the charge to the jury contained a mass of details which need not have been placed before the jury. In a protracted narrative full of details, it is perhaps easy to find fault with a charge to the jury on the ground of prolixity. The question before us is not whether the charge to the jury is perfect in all respect: the question is has something gross occurred amounting to a complete misdescription of the whole bearing of the evidence ? We are unable to say that there has been any such gross misdirec tion by the learned Judge. (1) (1954] L.R. 41 I.A. 149 13 The second criticism relates to certain misdirections alleged to have been committed by the learned Judge in placing the evidence of the eye witnesses as also of medical witnesses. No useful purpose will be served by referring to each and every example given before us; we shall confine ourselves to some of the salient points and state the general impression we have formed. In placing the evidence of each eyewitness, the learned Judge referred to the suggestions made by the defence. The comment is that he placed the suggestions in such a way as to create the impression in the minds of the jury that they were true, even though they had been repudiated or explained by the witness. We may give some examples. Nirmal telephoned to his brother Dr. Lalit Mitra immediately after Col. Mitra was pronounced to be dead. The suggestion to Nirmal was that he had not told his doctor brother then that his father had been beaten, but had said only that his father had "fainted ". This suggestion was placed before the jury with reference to Nirmal 's deposition before the committing Magistrate. Nirmal said before the committing Magistrate that he did not use the English word I fainted ' but had said in Bengali that 'father has become unconscious '. The complaint of the petitioners is that Nirmal 's explanation has not been properly placed before the jury. But the learned Judge says in his charge that the jury had seen the earlier deposition of Nirmal, and if that is so, the dis tinction between I fainting ' and 'becoming unconscious ' in explanation of the suggestion made to Nirmal does not assume any great importance. It was next suggested to Nirmal that he had told the Police that his father had heart trouble. This suggestion was put before the jury in the following way: " The case was put by the defence that the Colonel had heart trouble and that Nirmal was confronted with contradiction that he told the Magistrate and the police that his father had heart trouble. Nirmal had denied it. " Nirmal 's explanation was that he did not tell the Magistrate or the police that his father had heart 14 trouble he merely said that his father used to have occasional palpitation of heart when he ate too much or took irregular meals. Pushpa Pal, the investigating police officer, understood this to mean heart trouble and he recorded " heart trouble " in Nirmal 's statement. Pushpa Pal admitted that even if Nirmal had stated that Col. Mitra had palpitation of heart, he would have recorded it as heart trouble. This part of the evidence of Pushpa Pal also the learned Judge placed before the jury. It cannot, therefore, be said that the learned Judge misled the jury in any way or left the jury with the impression that Nirmal had admitted that his father had heart trouble. Similar comments were made with regard to the placing of the evidence of other eye witnesses, but their general effect is the game. They do not, in our view, establish that the jury were misled on any of the points in dispute. We must, however, mention two more points, one in connection with a person called Sarat Banerji and the other with regard to Mrs. Nagendra Bala Ghose. Sarat Banerji, it appears, was a priest who brought some holy water, and there was some evidence to show that such water was sprinkled on the Colonel soon after the incident. Sarat Banerji was not examined in the case, and the question naturally arose whether he was present at the time of the incident and if so, when did he come to 18, Bondel Road ? A number of prosecution witnesses were crossexamined on this point, and the learned Judge repeatedly referred to this matter in summing up the evidence of those witnesses. We do not agree with learned counsel for the petitioners that the learned Judge committed any misdirection in drawing the attention of the jury to this matter. As to Mrs. Nagendra Bala Ghose, the criticism was that the learned Judge usurped the function of the jury. About this witness the learned Judge said: " Now, gentlemen, in cross examination she was cross examined on her eyesight. She did succeed in pointing out to an old man in Court. That is in answer to Q. 30. But further ahead she could not see properly. She is far too old a woman on whom any reliance can be placed having regard to her state of 15 health and having regard to her state of vision and her power of memory. Shew as called by the prosecution only to meet the defence suggestion that she was there at the time of the incident in Prof. Mahanti 's place and was being kept back. It was submitted before us that Mrs. Ghose was no doubt old, but she was a respectable and reliable witness who was staying in a neighbouring house from the verandah of which the place of incident was visible; therefore, it was argued that the learned Judge was not justified in expressing himself so strongly against this witness, and in doing so, he improperly dissuaded the jury from forming their own opinion about her evidence. Having examined her evidence, we are unable to hold that the comments of the learned Judge were unjustified or that he wrongly influenced the jury against the witness. It must be stated here that the learned Judge had cautioned the jury that they were not bound by his opinion on a question of fact and were free to act on their own opinion. This brings us to the medical evidence. The two doctors of importance who were examined in the case were Dr. Majumdar, who made the postmortem examination, and Dr. Kabir Hussain, Professor of Forensic and State Medicine in the Calcutta Medical College. Those two doctors expressed widely divergent views as to the probable cause of the injuries sustained by Col. Mitra and also of his death. The learned Judge rightly placed before the jury those divergent views. Dealing with the evidence of Dr. Majumdar, the learned Judge said: "Suggestions were made to Dr. Majumdar in cross. examination that in case a fist blow was given on the left temporal region whether any external injury was to be expected. He said that external injury was expected and there was no external injury mentioned in the postmortem report in this case. Then Dr. Maumdar 's opinion is that such a man cannot be expected to talk. It is also Dr. Majumdar 's opinion that the injury was due to a fall and he does not think that the injuries Nos. 1, 2 and 3 could be caused by a lathi blow or a blow by a rod. According to his opinion, the fracture was also due to a fall. 16 It is contended that this must have misled the jury in thinking that there was no external injury on the site of the fracture on the left temporal region and therefore it could not have been caused by a fist blow. Our attention was drawn to the evidence of Dr. Kabir Hussain, who opined that the haemorrhage on the inner surface of the scalp near the site of the fracture was an external injury. The point to be noticed in this connection is that the learned Judge did not omit to place before the jury what Dr. Kabir Hussain had said regarding what he thought to be the presence of an external injury at the site of the fracture; he placed in extenso the questions put to Dr. Kabir Hussain and the answers given by him on this point. Tile jury were, therefore, properly placed in possession of the views of both the doctors, and it was for them to decide which view should be accepted. Both the doctors were asked questions as to whether the injuries sustained by Col. Mitra could be caused by a fall on a rough substance like a masonry box or by a blow of a hard weapon like a flexible rod . On this point again the two doctors disagreed ; the learned Judge did place before the jury the different views expressed by the two doctors. A grievance has been made before us that in summing up the evidence of Dr. Kabir Hussain the learned Judge failed to draw the attention of the jury to the answers given to ques tions 73, 74 and 75 by which the doctor categorically negatived the suggestion of the defence that a fracture of the temporal gone of the kind sustained by the Colonel could be caused by a fall on a hard substance. It is true that the answers to questions 73, 74 and 75 we 're not specifically placed before the jury, but reading the charge relating to the medical evidence ' as a whole, we find that the learned Judge sufficiently indicated to the jury the disagreement between the two doctors on the main questions of fact and the reasons which each doctor gave for his opinion. It was the province of the jury to accept one opinion or the other. The learned Judge concluded his summing up of the medical evidence in these words: " Now, gentlemen, when a medical witness is called in as an expert he is not a witness of fact. Medical 17 evidence of an expert is evidence of opinion, not of fact. Where there are alleged eye witnesses of physical violence which is said to have caused the hurt, the value of medical evidence by prosecution is only corroborative. It proves that the injuries could have been caused in the manner alleged and nothing more. The use which the defence can make of the medical evidence, or any medical evidence which the defence might itself choose to bring, is to prove that the injuries could not possibly have been caused in the manner alleged and thereby discredit the eye witnesses. Therefore, you must remember this particular point of view that if you believe the eye witnesses, then there is no question of having it supported by medical evidence; unless the medical evidence again in its turn goes so for that it completely rules out all possibility that such injuries could take place in the manner alleged by the prosecution and that is a point which you should bear in mind, because if you accept the evidence of the eye witnesses, no question of further considering the medical evidence arises at all. The only question in that case when you consider the medical evidence is to test the eye witnesses ' version as to whether any of the particular injuries shown in the report can be caused in the manner alleged by the prosecution. But if you don 't believe the eye witnesses, then consideration of the medical evidence in any manner becomes unnecessary. " We do not think that any exception can be taken to the observations made above in the context of the two versions which the jury had to consider. One version was that the Colonel had been assaulted and thereby sustained the injuries; the other version was that he had sustained the injuries by a fall on a rough surface like the masonry letter box. None of the two doctors were giving direct evidence of how the injuries were caused; they were merely giving their opinion as to how in all probability they were caused. The learned Judge was, therefore, right in directing the jury in the way he did about the medical evidence in the case. We may also point out here that the learned Judge drew the attention of the jury also to the evidence of Dr. Suresh Sinha, who said that the 3 18 fracture on the temporal region could be the indirect effect of the other injuries sustained by the Colonel. We now go on to third head of criticism viz., the ,learned Judge 's exposition of the law relating to the two charges on which Sunil was tried. These charges the learned Judge correctly explained with reference to the relevant provisions of the Indian Penal Code. But be made one error. Dealing with the word ' voluntarily ' in section 325, he said: "The word ' voluntarily ' means what it says; it means 'of one 's free will '. " Perhaps, the learned Judge forgot that the word is defined in section 39, Indian Penal Code, and that definition should have been placed before the jury. We do not, however, think that this minor lapse misled the jury in any way or occasioned a failure of justice. There is one more point in this connection. The learned Judge did not tell the jury that it was open to them to return a verdict of guilty for an offence under section 323, Indian Penal Code, if they came to the conclusion that Sunil gave a blow to the Colonel with a flexible rod, but did not cause the fracture. In the circumstances of the case, however, we do not think that the failure to direct the jury that it was open to them to return a verdict of guilty on a minor offence occasioned any failure of justice. If the eyewitnesses for the prosecution were believed, it would be undoubtedly a case under section 325 Indian Penal Code; if on the contrary, the eye witnesses were not believed and the defence version was accepted that the Colonel sustained the injuries by a fall, then there would be no case even under section 323 Indian Penal Code. A grievance was made before us under the fourth head of criticism that admissible evidence was shut out and inadmissible evidence was let in. It was submitted that Nirmal 's statements to Pushpa Pal on his arrival at No. 18, Bondel Road or at least his statements to the Head Constable Mathura Singh, before the arrival of the investigating officer, were not hit by section 162 Criminal Procedure Code and were clearly admissible in evidence. The learned Judge said in this connection: 19 " I would like to remind you that if any person makes any statement to the police, that is not admissible evidence as a rule unless in the case of contradictions which are formally proved, as you have seen the counsel for the accused has proved contradictions in some cases; but you must bear in mind that except such cases, this is no evidence." In the opinion which we have formed it is unnecessary to consider whether the learned Judge was right or wrong: because we are of the opinion that even if those statements of Nirmal were admissible, they would not be substantive evidence of the facts stated therein ; and if Nirmal 's evidence in Court was not accepted, his statements to the police officers concerned would hardly make any difference. As to the admission of inadmissible evidence, learned counsel for the petitioners placed before us those parts of the charge to the jury which dealt with the cross examination of prosecution witnesses on their police statements. Ho submitted that a large part of that cross examination was inadmissible in view of the decision of this Court in Tahsildar Singh vs The State of Uttar Pradesh (1). That decision dealt exhaustively with section 162 Criminal Procedure Code and laid down certain propositions to explain the scope of that section; it was, however, observed that the examples given therein were not exhaustive and the Judge must decide in each case whether the recitals intended to be used for contradiction satisfied the requirements of the law. We agree that on the principles laid down in Tahsildar Singh 's decision (1) some of the statements put to the prosecution witnesses were not really contradictions and did not, therefore, fall within what is permissible under section 162 Criminal Procedure Code. We may take, by way of example, what was put to Nirmal. The learned Judge placed the following contradictions in Nirmal 's evidence to the jury: "He was also cross examined on his statement to the police. The main point made in his cross examination on his statement to the police, are firstly, that the fist blow on the left temple was not mentioned by him and then he only said assault with blows before (1) ; 20 the police and that he also said that the Colonel was hit near about the gate of the house and not beside the boundary wall. It was also suggested to him in defence that the Colonel did not fall on the lawn at all but fell on the letter box. The further suggestion to him was that the fist blow was a false invention and it was intended only after the postmortem report was out. He was also told that he did not mention to the police that the Colonel was lying on his back. He was also criticised for not having mentioned the names of persons who carried his father after he had fallen down. Nirmal 's answer was that he was not asked and that it was physically impossible for him alone to carry his father. Then there was crossexamination as to whether the fist blow was before or after Sati Mitra had clasped the Colonel. " Now, on the principles laid down in Tahsildar Singh 's decision (1) Nirmal 's failure to mention before the police that his father was lying on his back was not a contradiction; but his failure to mention that a fist blow on the left temple was given to his father was a contradiction. Therefore, the point before us really is this : assuming that some of the statements admitted in evidence were not really contradictions, do they materially affect the verdict ? In our opinion, they do not. By and large, the important statements made before the police were admissible under section 162 Criminal Procedure Code; but some minor statements were not. We do not think that the verdict of the jury can be said to have been vitiated on this ground. Lastly, we come to the defence evidence. Here the complaint is that the learned Judge has summed up the defence evidence by adopting a different standard. We are unable to agree. Even with regard to the prosecution witnesses, the learned Judge had emphasised points in favour of the prosecution. For example, dealing with the evidence of Purna Mali, the learned Judge said: " Now, gentlemen, these questions are important because he does not improve the case or try to improve the case by suggesting that he saw a fist blow on the left temple and it is a matter for you to (1) A.T.R. I959 S.C. 1012 21 consider in this connection whether this is a witness whom you would consider a liar because you will have to consider the suggestion that if he were then he would have probably tried to improve the case by suggesting to say that he did see a fist blow on the temple." Dealing with the evidence of Pushpa Pal, the learned Judge pointedly drew attention of the jury to a circumstance which was partly in favour of the prosecution and partly of the defence: " You also remember that Pushpa Pal held an inquest at about 9 a.m. on the 11th August, 1950. He says that he examined the compound, the lawn, the boundary wall, the gate, the masonry letter box, the bricks on edge and the whole spot of 18, Bondel Road including the pathway, but he found no blood marks anywhere. " We have examined the charge to the jury carefully; it may suffer from a plethora of details and also perhaps a meticulous statement of the divergent views of the two doctors; but we have found no trace of the adoption of a double standard, or of a serious misdirection on any question of fact or law. We have, therefore, come to the conclusion that on the principles which this Court has adopted for interference with a jury verdict, no case for interference has been made out in this case. The appeal is accordingly dismissed. HIDAYATULLAH, J. I have had the advantage of reading the judgment just delivered by my learned brother, section K. Das, J. He ' is of the opinion that the charge to the jury by the learned trial Judge was proper. Since I have the misfortune to differ from him in this conclusion, I am delivering a separate judgment. In my opinion, the charge to the jury was defective for several reasons, particularly misdirec tions in law and absence of any guidance while setting forth at enormous length, without comment, the evidence in the case. My learned brother has pointed out that this is an unfortunate case, and I agree with him that it is so, in view of the events that have happened. The facts of the case were simplicity itself. The offence alleged 22 to have been committed as far back as August 11, 1950, has been the subject of three trials. It was first tried before the Additional Sessions Judge, Alipur who convicted the present respondent, Sunil, under sections 325 and 447 of the Indian Penal Code, agreeing with the verdict of the jury. On appeal, the High Court of Calcutta set aside the conviction, and ordered a, retrial at the Criminal Sessions of the High Court. The case was then tried. by Mitter, J. with a special jury. The jury brought in an unanimous verdict of guilty against Sunil under the two sections, with which the learned Judge agreed. Sunil was sentenced to a long term of imprisonment, but the appellate side of the Calcutta High Court, on appeal, set aside the conviction and sentence, and ordered a retrial. The third trial was conducted by P. B. Mukherjee J. Before the trial, the State Government withdrew the case against Sunil 's brother, Satyen, who was tried along With him in the previous trials, and was also convicted. This withdrawal of the case was on the somewhat unusual ground that his health was bad. Sunil himself, it appears, was defended at Government cost by one of the Government advocates. The trial dragged through a weary course, in which prolonged cross examination of the witnesses took place, and alleged contradictions between their previous versions were put to them in detail. After the arguments were over, the learned Judge charged the jury at considerable length. I have estimated that the charge is a document of some 50,000 60,000 words. How much of it was of any real guidance to the jury is a matter, to which I shall address myself in the sequel; but it appears at the outset that the length of the charge was somewhat extraordinary, regard being had to the plain facts, to which I now refer. On August 11, 1950, Sunil and his brothers were occupying a flat in No. 17 Bondel Road, which belonged to Nirmal, son of the late section C. Mitra, a very well known Gynaecologist and Surgeon of Calcutta. It appears that the water supply to the flat was irregular and intermittent, and Sunil bad, in common with the other tenants, a complaint against the land 23 lord, Nirmal. Incidents had taken place previously, and Sunil had taken the matter to the rent control authorities, and, it is alleged, had even threatened the landlord with dire consequences, if the water supply was not improved. Under an alleged agreement, the water supply was regulated by working the electric pump during certain hours of the day; but nothing turns upon it. It appears that the water supply did not improve, and often enough, an 'exasperating situation arose in so far as the tenants of No. 17, Bondel Road, including the present respondent, Sunil, were concerned. On the fateful morning, matters came to a head, because the water supply, as was frequent, failed in the flat. Evidence has been led in the case to show that Sunil was angry and started abusing and expostulating in a loud manner. He followed up his expostulations by entering the compound of No. 18, Bondel Road, whether to see to the working of the pump himself, as he contended, or to remonstrate more effectively with the landlord, as is the prosecution case. However it be, Nirmal 's father, Col. Mitra, happened to be present that morning, and he came out to talk the matter over with Sunil, who apparently was quite loud in his remonstrances. Whether the Colonel gave any offence to Sunil by rebuking him is not much to the present purpose, because I am not determining the true facts in this order. The case for the prosecution is that Sunil grappled with the Colonel, and gave him a blow upon the head with what is described as a `rod like ' object, and also hit him on the temple with his fist. The Colonel, it is alleged, fell down, while Sunil clambered the parapet wall, and made good his escape, because the Colonel had previously ordered that the gates be shut. Meanwhile, the Colonel was taken and laid on a cot, where he expired. A phone call having been made to the police, the Investigating Officer arrived on the scene, and after taking some statements including one from Sunil, he went and arrested him and also his two brothers. Post mortem examination revealed a linear fracture of the temporal bone with a haematoma under the surface. On the forehead of the Colonel 24 was a mark of the injury alleged to have been given with the ' rod like ' object, though over the seat of ' the fracture no outward visible injury was seen. The doctor who performed the autopsy also found certain pathological defects in the liver and the, gall bladder, and he asked the Chemical Examiner to examine the viscera for possible poisoning. He gave the opinion that death was "due to shock consequent to head Injury, i.e., injuries on the top of senile changes and pathological liver and gall bladder as well as to inhibition." With regard to the head injury which was certified to be ante mortem, the doctor was of opinion that it was likely to have been caused by a fall on some hard substance. The charge against Sunil, in the first instance, was under section 302, but the case proceeded in the sub sequent trials only under section 325 read with a further charge under section 447 of the Indian Penal Code for house trespass, with intention to intimidate, insult or annoy the owner. The above facts clearly show that the essence of the case lay in a very narrow compass. The questions which the jury had to determine were whether Sunil trespassed into the premises of No. 18, Bondel Road with the intention of insulting, intimidating or annoying the owner and further, whether Sunil struck one or more blows either with a I rod like ' object or his fist on the head of Col. Mitra, thereby causing him injuries, simple or grievous. Alternatively, the jury had to determine whether Col. Mitra suffered these injuries not at the hands of Sunil but by a fall, which was the defence. No doubt, the case involved a very lengthy cross examination of the witnesses for the prosecution, who alleged that they had witnessed the entire occurrence. The issues to be decided were simple; One would have expected that the learned Judge in charging the jury would have, at least, pointed out to the jury what were the points for determination after weighing the evidence, pro and con, in the case; but the learned Judge did not, in spite of the voluminous charge, put these simple points before the jury. The attention of the jury was never directed to these simple matters, but, on the 25 other hand, it was directed to almost everything else. No doubt, a verdict of the jury is entitled to the greatest weight, not only before the Court of trial but in all appeals including that before this Court. The law does not allow an appeal against the verdict, except only if the Judge in his charge to the jury is guilty of a wrong direction in law or of a substantial misdirection. Since the verdict of the jury depends upon the charge, the charge becomes a most vital document in judging whether the verdict be sustained or not. It is the charge which one has to examine, to find out whether the verdict is defective or not. Such an important stage in the trial requires that the Judge should be careful to lead the jury to a correct appre ciation of the evidence, so that the essential issues in the case may be correctly determined by them, after understanding the true import of the evidence on the rival sides. A charge which fails to perform this basic purpose cannot be regarded as a proper charge, and if it contains also misdirections as to law, it cannot be upheld. The learned Judge in his charge to the jury began by telling the jury in a sentence, or two each, what were the essential things they had to remember, before making up their minds as to the verdict. He told the jury that they were the judges of fact, and that it was their function to determine all issues of fact, without accepting any view which he might feel disposed to express upon the credibility or otherwise of the ' witnesses. These observations in black and white do read quite well; but, in view of the fact that the Judge expressed ' almost no opinion as to the credibility or otherwise of the witnesses, it lost in practical application all its point. Then, the Judge stated that every accused was presumed to be innocent, until the contrary was proved, and further, that the jury should convict only if the facts were compatible with his guilt. So far as this direction went, nothing can be said against it. The Judge next pro ceeded to explain what was meant by the expression fact proved ". He paraphrased the definition of proved " from the Evidence Act. In dealing with 4 26 this topic, he omitted to explain also the expressions " disproved " and " not proved " ; but that too cannot be said to be a serious defect. He then expatiated on reasonable doubt, the benefit of which, according to him, must go to the accused. In dealing with this subject, he observed as follows: " The law further says, if you have any reasonable doubt, then the fact is not proved and the verdict you bring would be a verdict of not guilty. If you have no reasonable doubt, then the verdict you are to give is the verdict of guilty. A further question that you should bear in mind is that you may be in a state where you cannot decide. That is a case of benefit of doubt and if you reach such a stage, then the law says that you will give the benefit of doubt to the accused. That means that if you have a kind of doubt which makes you unable to decide, then the accused is not guilty. Again, if you have no such doubt, then the accused is guilty. These are the main principles of criminal trial which I think, you should bear in mind while you are approaching the evidence in this case. " This statement of the law is partly true but not wholly true. The learned Judge, with due respect, did not make it clear to the jury that the prosecution case is built up of numerous facts, though the fact to be determined is the guilt of the accused, and that a reasonable doubt may arise not only in connection with the whole of the case but also in relation to any one or more of the numerous facts, which the prosecution seeks to establish. Every individual fact on which doubt may be entertained may be held against the prosecution; but it ' does not mean that if the jury entertained a doubt about any individual fact, the benefit of that doubt must result in their bringing in a verdict I of not guilty '. This, however, seems to be the effect of this direction which incidentally is almost the only direction on the point of law which the learned Judge, apart from what I have stated earlier, has chosen to give. In my opinion, the learned Judge should have told the jury that they could give the benefit of the doubt on proof of any individual fact, if they felt any doubt 27 about the proof. But be should have cautioned them that the totality of facts must be viewed in relation to the offence charged, and the benefit resulting in acquittal could be given only if they felt that when all was seen and considered, there was doubt as to., whether the accused had committed the crime or not. The direction on the point of law contained in the above passage was too attenuated, and, in my opinion misleading, and led to the inference, possibly, that if the jury felt a doubt about even one circumstance, they must bring in a verdict of not 'guilty '. Having laid down the law to the extent indicated above, the learned Judge next explained the ingredients of section 325 of the Indian Penal Code. He explained this with reference only to grievous hurt, drawing the attention of the jury to ' fracture of bone ' or injury endangering life ' in the definition. He, failed to say that grievous hurt was only an aggravated form of hurt, and that the liability of the accused did not cease, if he committed an act which resulted in a simple hurt. Indeed, the learned Judge did not tell the jury that even if they held that the accused did not cause a grievous injury, it would be open to them to hold that he caused a simple injury, which would bring the matter within section 323 of the Indian Penal Code. I may further point out that after the verdict of I not guilty ' under section 325, the learned Judge did not question the jury whether they thought that the accused was guilty of causing at least simple hurt. The jury gave no reasons; they only answered the query whether they thought that the accused was guilty of the offence of causing grievous hurt. But they were not questioned whether they thought, on the facts of the case, that the accused had committed the lesser offence of causing simple hurt. It must be remembered that the prosecution case was that two blows were given, one causing the injury to the temple resulting in a fracture of the temporal bone and the other, causing an injury on the forehead of of Col. Mitra. One of them was grievous; the other was not. Of course, the jury were perfectly entitled, to hold that the accused caused neither of these injuries; but it is possible that the jury, if questioned, 28 would have answered that they thought that the accused had caused the simple injury but not the one resulting in the fracture of the temporal bone. The failure to question the jury with regard to the lesser ,offence completely ruled out that aspect of the case from the minds of the jury, with the result that the jury were limited to a case of grievous hurt and not lesser offence. These defects in the charge to the jury on matters of law are heightened by the manner in which the facts have been laid before them. The charge to the jury, as I have stated, ran the course of 50,00060,000 words. The matter I have so far discussed is contained in 1,000 1,500 words. Thereafter, the learned Judge did nothing more than paraphrase the evidence of each single witness in detail, or read out extracts from it. Throughout the course of this reading and paraphrasing, he made no attempt to connect the evidence with the fact to be tried. All that he ever said and he said it with monotonous iteration was that it was for the jury to decide whether they believed the witnesses or not. No doubt, a Judge in charging the jury is neither compelled nor required to express his opinion on the evidence, except on a matter of law. But Judges marshll facts and evidence to draw the attention of the jury to what is relevant and what is not. They do hot try to place everything that a witness states, before the jury. It must be remembered that a charge is a vital document, and the Judge 's summing up is only needed, because the minds of the jury must be directed to the salient points in the evidence, so that they may avoid the irrelevant or immaterial parts thereof. The learned Judge before dealing with the evidence, prefaced his remarks by saying this : " I now propose to take up the prosecution witnesses individually with a view to sum up the evidence of each witness and the suggestions made to each by the counsel for the accused. " This represents a very fair and adequate summary of what the Judge really did, except that he did not sum up the evidence but placed it in its entirety. As I have stated, he took each witness, turn, by turn 29 paraphrased his evidence sentence by sentence, and read out those portions which he did not paraphrase, without trying to draw the attention of the jury to the relevancy or materiality of the various parts, The document is composed of a series of narrations with regard to the testimony of the witnesses ' each portion beginning with the words, " Then there is the evidence of witness so and so. " and ending with ,,This is the evidence of witness so and so. " In between is a voluminous account of everything that each witness stated. Not only this; no difference was made between the testimony of the eye witnesses and of the formal witnesses in the matter of treatment. I quote verbatim from the charge what the learned Judge said with regard to one of the police witnesses. " Then comes the evidence of Head Constable Mathura Singh. He reached No. 18, Bondel Road in a lorry and he was accompanied by a constable. You remember he was first sent by Pushpa Pal. This Head Constable Mathura Singh posted another constable at the gate so as not to allow a crowd to gather. He also saw Col. Mitter lying unconscious like a dead person covered with a blanket. He also had talk with Nirmal. I would like to remind you that if any person makes any statement to the police, that is not admissible evidence as a rule unless in the case of contradictions which are formally proved as you have seen the Counsel for the accused has proved contradictions in some cases but you must bear in mind that except such cases, this is no evidence. Then this Constable Mathura Singh went to No. 17 with the other constable and posted that other constable at No. 17 to control the crowd so as to prevent any one coming out of No. 17 And then while he was coming back to No. 18 to find out if he could telephone the officer in charge, the constable found the officer in charge at the gate of No. 18. After Pushpa Pal, the Officer in charge came out of No. 18, Bondel Road, he went to No. 17 and brought down the accused. That is the evidence of Constable Mathura Singh also. This Constable took charge of the accused and left for the thana with the accus 30 ed at about 9 O 'clock in the morning on the 11th August, 1950. Mathura Singh was cross examined and be said in cross examination that he did not note down the names of the persons forming the crowd at No. 18. He did not go and find any article at No. 17. His evidence is that he was there to guard No. 17 so that no one escaped from there. " It needs no argument to apprehend that all this was not only a waste of the Court 's time but was also likely to obliterate the impression which the jury had gathered with regard to the other material evidence in the case. This is only one passage quoted from the evidence of one witness. Not only were several such witnesses brought to the notice of the jury; but even in the evidence of those that were relevant and material, there was no attempt made to extricate the relevant from the irrelevant, the material from the immaterial, the ore from the dross. The learned Judge, as he had indicated, followed the pattern of putting all the evidence before the jury without any attempt to focus their attention on the salient parts of it, and without expressing his opinion either for or against the accused. There were only two passages in the entire charge, in which the learned Judge expressed his opinion. One was with regard to an old lady who was an eyewitness and who viewed the incident from the upper storey of a neighbouring house. That lady was the one person about whom it could be said that she was entirely disinterested and whose respectability was above reproach. She was old and had weak eyesight. She had stated that she saw the quarrel going on, then she asked for her spectacles and saw properly. Whether she saw correctly or not was the question. The learned Judge told the jury that the lady was too old and unreliable to be a proper witness, without warning them this time that his opinion was not binding on them. The other comment is with regard to the medical evidence, where the learned Judge in one part promised the jury that he would give them adequate guidance how to weigh the conflicting medical testimony, which, it appears, he forgot to do at the end, and in another portion, he gave this direction: 31 "Now, gentlemen, when a medical witness is called as an expert he is not a witness of fact. Medical evidence of In expert is evidence of opinion, not of fact. Where there are alleged eye witness of physical violence which is said to have caused the, hurt, the value of medical evidence by prosecution is only corroborative. It proves that the injuries could have been caused in the manner alleged and nothing more. The use which the defence can make of the medical evidence, or any medical evidence which the defence might itself choose to bring, is to prove that the injuries could not possibly have been caused in the manner alleged and thereby discredit the eyewitnesses. Therefore, you must remember this particular point of view that if you believe the eye witnesses, then there is no question of having it supported by medical evidence; unless the medical evidence again in its turn goes so far that it completely rules out all possibility that such injuries could take place in the manner alleged by the prosecution and that is a point which you should bear in mind, because if you accept the evidence of the eye witnesses, no question of further considering the medical evidence arises at all. The only question in that case when you consider the medical evidence is to test the eye witnesses ' version as to whether any of the particular injuries shown in the report can be caused in the manner alleged by the prosecution. But if you don 't believe the eye witnesses then consideration of the medical evidence in any manner becomes unnecessary. I think this will be gentlemen, a convenient time for you to halt, otherwise it might be too tiring for you. (Foreman of the jury expressed the desire to continue the Charge). " I do not think that the direction is either correct or complete. is incorrect, because a medical witness who performs a postmortem examination is a witness of fact,though he also gives an opinion on certain aspects of the case. Further, the value of a medical witness is not merely a check upon the testimony of eyewitnesses; it is also independent testimony, because it may establish certain facts, quite apart from the other oral evidence. If a person is shot, at close 32 range, the marks of tatooing found by the medical witness would show that the range was small, quite apart from any other opinion of his. Similarly, fractures of bones, depth and size of the wounds would show the nature of the weapon used. It is wrong to say that it is only opinion evidence; it is often direct evidence of the facts found upon the victim 's person. However that be, these two passages were the only directions given by the learned Judge to the jury ; the rest of the charge was only a paraphrase of the medical evidence running the course of 15,000 words. There is also a complete disregard of section 162 of the Code of Criminal Procedure both during the trial and also during the charge. Omissions were treated as contradictions and placed before the jury. The following two passages extracted from the charge illustrate the defect at both stages : Q. 151. Did you tell the police that you did not see when the old man was assaulted and who assaulted him ? A. I stated to the police that I had seen the old man being dealt a fist blow, but I had not seen him being struck with a rod. Q. 152. Did you tell the police that you did not see when the old man was assaulted and who assaulted him ? A.No. I did not make that statement. I Gentlemen, that is a contradiction and it will be for you to judge how far that goes to destroy the credit of this witness. Another contradiction was put to him that he did not mention that Sati Mitra was pulled by hair, but he says it here. You will find from his answer to Question 158 that even before the police he made the statement that Sati Mitra was pushed away. The language used was pushed away '. Then in answers to Questions 161 to 164 further contradictions with this police statement were made out in cross examination. The first is that it was not mentioned by him before the police that there was any fist blow on the Colonel; secondly, that it was not mentioned to the police by him that Sati Mitra intervened in the matter by clasping the Colonel, and also on the point whether 33 the Colonel was dragged by his shirt. I will read out the relevant questions and answers: Q. Do you find further that you have stated in the next paragraph after that 'I also saw another tall person stated to be the second brother was dragging the old man holding his wearing shirt '? A. I saw that person dragging the Colonel by holding his genji and when a fist blow was given to the Colonel, Sati Mitter came and clasped him from a side. Q. 161. Do you find here that all that is written is that you saw the Colonel being dragged and nothing is mentioned about the fist blow and Mrs. Sati Mitter clasping her father in law and being pulled away by the hair ? A. I do not know how the police had recorded my statement. But I am telling you that (what) I saw. I saw that when a fist blow was given to the Colonel Sati Mitter came and clasped the Colonel from a side and she was thrown down by being caught by her hair. Q.164. Forget about the genji and the shirt You find here that nothing is mentioned about your evidence that you saw the Colonel being given a fist blow by the accused on the left temple and then Sati Mitter coming and clasping the Colonel round his waist, you find that is not mentioned ? A. On my being repeatedly asked about the lathi blow I denied to the police that I had seen any lathi blow being given to him, but I said that I had seen a fist blow being given. " The second passage is even more significant. This is how it runs: " She makes it clear that she saw the incident at different stages having been to the kitchen in the meantime and come back. She saw the Colonel after her return from the kitchen. She does not remember the dress of the assailant. She also says that the gate of No. 18 was closed. Her evidence has been criticised also for contradiction between her evidence here and her statement to the police first. It is said that she said before the police that she heard the hulla herself; here she says that it was the children 's cries 5 34 which attracted her attention. Secondly, she said to the police that she came first to the drawing room ; here she says that she came first to the verandah. Thirdly, she also said to the police that she saw the person wearing Choti or pants and blue shirs Fourthly, before the police she said that she saw the three persons leaving Nirmal and started arguing. Here she says that she did not see them arguing. Fifthly, it is said she told the police she saw the Colonel once go near the pillar of the gate on the western side but she does not say so here. Then again, it is said that she told the police that she saw the assailant bring out a black looking object from somewhere in his waist and she subsequently saw the old man fallen down. She said here that she did not see the old man falling down. Gentlemen, you will again weigh these contradictions and see whether they are such as to discredit the witness or are such for which you can make allowance. In fact, she said in cross examination that I something ' was brought out by the assailant from his right side. I think, gentlemen of the jury, you also asked her some questions. Q. During the examination it appears that you have told us that you saw Colonel Mitter being drawn towards 17, Bondel Road ? A. He was being dragged in the direction of the Mansion House. Q. 111. That is, towards the west of the path ? A. Yes. Q. 112. How far was he from the boundary walls abutting the Bondel Road ? A. I would not be able to tell you that because I was seeing this from above, from a height. Then the last question to her was this: Q. 113. You have just given us more or less what you saw. Could you also tell us exactly on what part of the lawn, was it at the central portion of the lawn or was it on the side of the lawn that you saw that one person who was with the Colonel was bringing out something from his side ? At what position were the Colonel and that gentleman standing ? 35 A. It is difficult for me to describe the position. But I can say that he was neither in the exact centre of the lawn nor was he absolutely on an extreme side of the lawn. He was somewhere about 4 or 5 cubits way from the gate of the boundary wall. " In the previous trials, the Calcutta High Court rejected the verdict of the jury, because in the opinion of Chakravarti, C.J. (Sarkar, J. concurring), it was all comment and no evidence. It may be said that this time it was all evidence and no comment or arrangement. The Calcutta High Court has laid down in a series of cases what the charge to the jury should be, and I shall refer only to the Calcutta cases. There is no settled rule or practice as to what a charge should or should not contain. That is dictated by the circumstances of each case. Sir James Fitz James Stephen in his History of Criminal Law of England, Vol. 455 456 (quoted in Trial by Jury and Misdirection by Mukherji, 1937 Edn., at p. 237) says: "The summing up again is a highly characteristic part of the proceedings, but it is one on which I feel it difficult to write. I think however that a Judge who merely states to the Jury certain propositions of law and then reads over his notes does not discharge his duty. This course was commoner in former times than it is now. I also think that a Judge who forms a decided opinion before he has heard the whole case or who allows himself to be in any degree actuated by an advocate 's feelings in regulating the proceedings, altogether fails to discharge his duty, but I further think that he ought not to conceal his opinion from the Jury, nor do I see how it is possible for him to do so, if he arranges the evidence in the order in which it strikes his mind. The mere effort to see what is essential to a story, in what order the important events happened, and in what relation they stand to each other must, of necessity, point to a conclusion. The act of stating for the Jury the questions which they have to answer and of stating the evidence bearing on those questions and in showing in what respect it is important, generally goes a considerable way 36 towards, suggesting an answer to them, and if a Judge does not do as much at least as this, he does almost nothing. " As pointed out by Mukerji (ibid p. 253): " Where the charge to the Jury was little more than a rambling statement of the evidence as it came from the mouths of the several witnesses who were called and no attempt was made to sift the relevant and important matters from the irrelevant and unimportant facts, held that the charge was defective and the trial was vitiated on that account. (Jabed Sikdar) (1). It is not sufficient for the Judge simply to point out this peace of evidence and that, this presumption and that, this bit of law and that. It is his duty to help and guide the Jury to a proper conclusion. It is his duty to direct the attention of the Jury to the essential facts. It is his duty to point out to them the weight to be attached to the evidence and to impress upon them that if there is any doubt in their minds they must give the benefit of the doubt to the accused. It is not enough that the Judge has said something on each of these matters somewhere in the charge. It is the manner of saying it, the arrangement and the structure of his charge which will make it either of value or valueless to the Jury. (Molla Khan) (2). It is not enough to read out the evidence in extenso it is incumbent on the Judge to analyse it and place it succinctly before the Jury (Rajab Ali) (3). " The charge in this case goes manifestly against these directions. It is no more than 'a recital of the entire evidence in the case ' almost as detailed as the evidence itself, and there is no attempt whatever to give any guidance to the Jury. No doubt, the Privy Council in Arnold vs King Emperor(4) stated that: " A charge to a Jury must be read as a whole. If there are salient propositions of law in it, these will, of course be the subject of separate analysis. But in a protracted narrative of fact, the determination of which is ultimately left to the jury, it must (1) (2) A.I.R. 1934 Cal. 169 (S.B.) (3) A.I.R. 1927 Cal. (4) (1914) L.R. 4I I.A. 149. 37 needs be that the view of the Judge may not coincide with the view of others who look upon the whole proceedings in black type. It would however, not be in accordance with usual or good practice to treat such cases as cases of misdirection, if, upon the general view taken, the case has been fairly left within the Jury 's province. " These observations apply only if the matter has been fairly left to the jury. When this charge is read through its vast length, the most astute person is left guessing as, to where it was all driving the jury to. It is a protracted narrative no doubt, but it is so amorphous as to give no indication of its real purport and import, and leaves the matter not in the hands of the jury, but, if I may so say with great respect, in the air. I think that this was a case for the exercise of the powers of this Court under article 136. As was laid down in Ramkrishan Mithanlal Sharma vs The State of Bombay(1), the Judge in summing up for the prosecution and defence should not give merely a summary of the evidence; he must marshall the evidence so as to give proper assistance to the jury, who are required to decide which view of the facts is true. I am, therefore, of opinion that the charge to the jury cannot be said to be a proper charge on any principle or precedent, and that the verdict cannot be accepted. Though this case has taken already almost ten years, there is prima facie reason to think that justice has failed. Since the matter is now before the highest Court, there is no likelihood of any further delay in the case, and what is just therein can be done. I would, therefore, proceed to hear the case on merits. By Court: In accordance with the opinion of the majority, this appeal is dismissed. Appeal dismissed. (1) ; , 930.

In a trial by jury, the judge should in his charge to the jury be careful to lead them to a correct appreciation of the evidence so that the essential issues in the case may be correctly determined by them after understanding the true import of the evidence on the rival sides. Since a verdict of the jury depends upon the charge, if it fails to perform this basic purpose it cannot be regarded as a proper charge and if it contains also misdirections as to law, the verdict cannot be upheld; but if, upon the general view taken, the case has been fairly left within the jury 's province, the verdict cannot be set aside unless something gross amounting to a complete misdescription of the whole bearing of the evidence has occurred. Mushtak Hussein vs The State of Bombay, ; , Ramkrishan Mithanlal Sharma vs The State of Bombay, ; and Arnold vs King Emperor, (1914) L.R. 41 I.A. 149, relied on. Per section K. Das and Sarkar, jj. Though the charge to the jury in the present case was lengthy, the length was due in part to a protracted narrative of facts and the many disputed questions of fact to which the attention of the jury had to be drawn, and as the judge did state the several disputed points arising therefrom and their bearing on the main qestions at issue, the jury were not misled. Held, that there was no misdirection and that the verdict of the jury could not be interfered with. Per Hidayatullah, J. In his charge to the jury, in the present case, (1) the judge took each witness, turn by turn, paraphrased, his evidence, sentence by sentence and read out those portions which he did not paraphrase, without trying to draw the attention of the jury to the relevancy or materiality of the various 2 parts; and did not make any difference between the testimony of the eye witnesses and of the formal witnesses in the matter of treatment, (2) while telling the jury that they could give the benefit of the doubt on proof of any individual fact if they felt any doubt about the proof, the judge did not at the same time caution them that the totality of facts must be viewed in relation to the offence charged and that the benefit resulting in acquittal could be given only if they felt that when all was seen and considered, there was doubt as to whether the accused had committed the crime or not, (3) the judge while explaining the ingredients of the offence of grievous hurt under section 325 of the Indian Penal Code failed to tell the jury that grievous hurt was only an aggravated form of hurt and that even if they held that the accused did not cause a grievous injury it would be open to them to hold that he caused a simple injury which would bring the matter within section 323 Of the Code, and (4) omissions were treated as contradictions and placed before the jury in complete disregard of section 162 of the Code of Criminal Procedure, Held, that these defects amounted to misdirections and that the verdict could not be accepted.

Appeal No. 1042 of 1963. Appeal by special leave from the judgment and order dated May 3, 1963, of the Madhya Pradesh High Court in First Appeal No. 46 of 1962. section K. Kapur, B. L. Khanna and B. N. Kirpal, for the appellant. Homi Daji, R. K. Garg, section C. Agarwal, M. K. Ramamurthi and D. P. Singh, for the respondent. December 20, 1963. The Judgment of P. B. Gajendragadkar, A. K. Sarkar, K. N. Wanchoo and K. C. Das Gupta, JJ. was delivered by Gajendragadkar J. N. Rajagopala Ayyangar J. delivered a separate opinion. GAJENDRAGADKAR J. The question of law which this appeal has raised for our decision is in relation to the nature and scope of the enquiry contemplated by sections 97, 100 and 101 of the Representation of People Act, 1951 (No. 43 of 1951) (hereinafter called the Act). The appellant Jabar Singh and the respondent Genda Lal, besides five others, had contested the election to the Madhya Pradesh Assembly on behalf of the Morena Constituency No. 5. This election took place on the 21st February, 1962. In due course, the scrutiny of recorded votes took place and counting followed on the 27th February, 1962. As a result of the counting, the appellant was shown to have secured 5,671 votes, whereas the respondent 5,703 votes. It is not necessary to refer to the votes secured by the other candidates. After the result of the counting was thus ascertained, the appellant applied for recounting of the votes and thereupon, 58 recounting followed as a result of which the appellant was declared elected having defeated the respondent by 2 votes. The recounting showed that the appellant secured 5,656 votes and the respondent 5,654. Thereafter, the respondent filed an election petition from which the present appeal arises. By his petition the respondent challenged the validity of the appellant 's election on the ground ' of improper reception of votes in favour of the appellant and improper rejection of votes in regard to himself. The respondent urged before the Tribunal either for the restoration of the results in accordance with the calculations initially made before recounting, or a re scrutiny of the votes by the Tribunal and declaration of the result according to the calculations which the Tribunal may make. His prayer was that the appellant 's election should be declared to be void and a declaration should be made that the respondent was duly elected. The Election Tribunal found that 10 ballot papers in favour of the respondent had been improperly rejected and 4 had been improperly accepted in favour of the appellant. That led to a difference of 12 votes and the position of the votes was found to be the respondent 5,664 and the appellant 5,652 votes. At this stage, the appellant urged before the Tribunal that there had been improper rejection of his votes and improper acceptance of the votes of the respondent, and his case was that if recounting and re scrutiny was made, it would be found that he had secured a majority of votes. The respondent objected to this course; his case was that since the appellant had not recriminated under section 97 of the Act, it was not open to him to make the plea that a recounting and re scrutiny should be made on the ground that improper votes had been accepted in favour of the respondent and valid votes had been improperly rejected when they were cast in favour of the appellant. The respondent 's contention was that in order to justify the claim made by the appellant it was necessary that he should have complied with the provisions of the proviso to section 97(1) of the Act and should have furnished security as required by it. The failure of the appellant in that behalf precluded him from raising such a contention. 59 The Tribunal rejected the respondent 's contention and held that in order to consider the relief which the respondent had cliamed in his election petition, it was necessary for it to decide whether the respondent had in fact received a majority of votes under section 101 of the Act, and so,. he re examined the ballot papers of the respondent as well as the appellant and came to the conclusion that 22 ballot papers cast in favour of the respondent had been wrongly accepted. The result was that the respondent had, in fact, not secured a majority of votes. As a consequence of these findings, the Tribunal declared that the election of the appellant was void and refused to grant a declaration to the respondent that he had been duly elected. This decision led to two cross appeals before the High Court of Madhya Pradesh, No. 46 of 1952 and No. 1 of 1963 respectively. The appellant challenged the conclusion of the Tribunal that his election was void, whereas the respon dent disputed the correctness of the decision of the Tribunal that no declaration could be granted in his favour that be had been duly elected. In these appeals. the main question which was agitated before the High Court was about the nature and scope of the enquiry permissible under sections 100 and 101 of the Act. In dealing with this question, the High Court based itself upon its own earlier decision in Inayatullah Khan vs Diwanchand Mahajan and Ors.(1). , as well as the decision of this Court in Bhim Sen vs Gopali and Ors. (2) and held that the grievance made by both the parties in their respective appeals was not well founded and that the decision of the Tribunal was right. In the result, both the appeals were dismissed and the decision of the Tribunal was confirmed. Against this decision, the appellant has come to this Court by special leave. Later on, the respondent filed an application for leave to appeal to this Court, but the said application was filed beyond time. When the said application came on for hearing before this Court, the delay made by the respondent in preferring his application for special leave was not condoned, and so, the decision of the High Court against the respondent has become final and is not (1) (2) 60 longer open to challenge in this Court. When the applica tion for leave filed by the appellant was argued and admitted by this Court, it was urged by Mr. Kapoor on his behalf that the observations made by this Court in the case of Bhim Sen(1) on which the High Court substantially relied required reconsideration. That is why the appeal has been placed before a Bench of five Judges for final hearing. In dealing with the question raised by Mr. Kapoor before us, it is necessary to refer to the provisions of the Act in re gard to the presentation of election petitions and the prayers that the petitioners can make therein. Section 81 provides that an election petition calling in question any election on one or more of the grounds specified in sub section (1) of section 100 and section 101 may be presented to the Election Commission by any candidate or any elector within the time specified by the said section. It is thus clear that when a person presents an election petition, it is open to him to challenge the election of the returned candidate under section 100 (1) and claim a declaration that the returned candidate 's election is void. He can also claim a further declaration that he himself or any other candidate has been duly elected. In other words, if the election petition contents itself with claiming a simple declaration that the election of the returned candidate should be declared to be void, the petition falls under section 100 and the Election Tribunal can either grant the said declaration in which case the petition is allowed, or refuse to grant it in which case the petition is dismissed. It is also possible that the election petition may claim two reliefs, one under section 100 (1), and the other under section 101. In this category of cases, the Tribunal first decides the question as to whether the election of the returned candidate is valid or not, and if it is found that the said election is void, it makes a declaration to that effect and then deals with the further question whether the petitioner himself or some other person can be said to have been duly elected. The scope of the enquiry which the Tribunal has to hold in such cases would obviously depend upon the nature of the reliefs claimed by the petition. There is another fact which it is necessary to bear in mind in dealing with the controversy before us in the present ap (1) 61 peal. When elections are held, the declarations of the results are governed by the statutory rules framed under the Act. The counting of votes is dealt with in the relevant rules under Part V. Rule 55 deals with the scrutiny and opening of ballot boxes. Rule 56(1) requires that the ballot papers taken out of each ballot box shall be arranged in convenient bundles and scrutinised. R. 5 6 (2) provides when the returning officer has to reject a ballot paper; the grounds for rejection are specified in clauses (a) to (h). Rules 56(3), (4) and (5) prescribe the procedure for rejecting ballot papers. When the ballot papers have been taken out of the ballot boxes and have been scrutinised, counting follows and that is dealt with by r. 57 and the following Rules. R. 63 provides for recounting of votes; R. 63(1) lays down that after the counting has been completed, the returning officer shall record in the result sheet in Form 20 the total number of votes polled by each candidate and announce the same. R. 63(2) permits an application to be made for a recounting and if that application is allowed, a recounting follows. If a recounting is made, then the result is declared once again on the sheet in Form 20. In pursuance of the result of counting thus announced, the re sult of the election is declared under r. 64 and a certificate of election is granted to the returned candidate. It is significant that r. 57(1) provides that every ballot paper which is not rejected under r. 56 shall be counted as one valid vote, which means that after the ballot papers have been scrutinised and invalid papers are rejected under r. 56(2), all voting papers which have been taken into the counting by the returning officer shall be deemed to be valid under r. 57(1). Similarly, when the scrutiny of the nomination papers is made by the returning officer under section 36 of the Act and as a result, certain nomination papers are accepted, section 36(8) provides that the said acceptance shall be presumed to be valid. In other words, when an election petition is filed before an Election Tribunal challenging the validity of the election of the returned candidate, prima facie the acceptance of nomination papers is presumed to be valid and the voting papers which have been counted are also presumed to be valid. The election petition may challenge the validity of the votes counted, or the validity of the acceptance or rejection of a nomination 62 paper; that is a matter of proof. But the enquiry would commence in every case with prima facie presumption in favour of the validity of the acceptance or rejection of nomination paper and of the validity of the voting papers which have been counted. It is necessary to bear in mind this aspect of the matter in dealing with the question about the scope and nature of the enquiry under sections 100 and 101 of the Act. Let us now read the three relevant sections with which we are concerned in the present appeal. Section 97 provides : "(1) When in an election petition a declaration that any candidate other than the returned candidate has been duly elected is claimed, the returned candidate or any other party may give evidence to prove that the election of such candidate would have been void if he had been the returned candidate and a petition had been presented calling in question his election. Provided that the returned candidate or such other party as aforesaid shall not be entitled to give such evidence unless he has, within fourteen days from the date of commencement of the trial, given notice to the Tribunal of his intention to do so and has also given the security and the further security referred to in sections 117 and 118 respectively. (2) Every notice referred to in sub section (1) shall be accompanied by the statement and particulars required by section 83 in the case of an election petition and shall be signed and verified in like manner". Section 100, sub section (1) reads as under: . (1) Subject to the provisions of subsection (2) if the Tribunal is of opinion (a) that on the date of his election a returned candidate, was not qualified, or was disqualified, to be chosen to fill the seat under the Constitution or this Act; or 63 (b) 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; or (c) that any nomination has been improperly rejected; or (d) that the result of the election, in so far as it concerns a returned candidate, has been materially affected (i) by the improper acceptance of any nomination, or (ii) by any corrupt practice committed in the interests of the returned candidate by an agent other than his election agent, or (iii) by the improper reception, refusal or rejection of any vote or the reception of any vote which is void; or (iv) by any noncompliance with the provisions of the Constitution or of this Act or of any rules or orders made under this Act, the Tribunal shall declare the election of the returned candidate to be void". Section 101 provides that: "If any person who has lodged a petition has, in addition to calling in question the election of the returned candidate, claimed a declaration that he himself or any other candidate has been duly elected and the Tribunal is of opinion (a) that in fact the petitioner. or such other candidate received a majority of the valid votes, or (b) that but for the votes obtained by the returned candidate by corrupt practices the petitioner or such other candidate would have obtained a majority of the valid votes, the Tribunal shall after declaring the election of the returned candidate to be void declare the petitioner or such other candidate, as the case may be, to have been duly elected". 64 Mr. Kapoor contends that in dealing with the cases falling under section 100 (1) (d) (iii), section 97 can have no application and so, the enquiry contemplated in regard to cases falling under that class is not restricted by the prohibition prescribed by section 97(1). He suggests that when the Tribunal decides whether or not the election of the returned candidate has been materially affected by the improper reception, refusal or rejection of any vote, or the reception of any vote which is void, it has to examine the validity of all votes which have been counted in declaring the returned candidate to be elected, and so, no limitation can be imposed upon the right of the appellant to require the Tribunal to consider his contention that some votes which were rejected though cast in his favour had been improperly rejected and some votes which were accepted in favour of the respondent had been improperly accepted. Basing himself on this position, Mr. Kapoor further contends that when section 101 requires that the Tribunal has to come to the conclusion that in fact the petitioner or such other candidate received a majority of the valid votes, that can be done only when a recount is made after eliminating invalid votes, and so, no limitations can be placed upon the scope of the enquiry contemplated by section 101 (a). Since section 100(1)(d)(iii) is outside the purview of section 97, it would make no difference to the scope of the enquiry even if the appellant has not recriminated as required by section 97(1). On the other hand, Mr. Garg who has addressed to us a very able argument on behalf of the respondent, urged that the approach adopted by the appellant in dealing with the problem posed for our decision in the present appeal is in appropriate. He contends that in construing sections 97. 100 and 101, we must bear in mind one important fact that the returned candidate whose election is challenged can face the challenge under section 100 only by making pleas which can be described as pleas affording him a shield of defence, whereas if the election petition besides challenging the validity of the returned candidate claims that some other person has been duly elected, the returned candidate is given an opportunity to recriminate and by way of recrimination he can adopt pleas which can be described as weapons of attack against the validity of the election of the other person. 65 His argument is that though section 100(1)(d)(iii) is outside section 97. it does not mean that in dealing with a claim made by an election petition challenging the validity of his election, a returned candidate can both defend the validity of his election and assail the validity of the votes cast in favour of the petitioner or some other person. It is in the light of these two rival contentions that we must now proceed to decide 'what the true legal position in the matter is. It would be convenient if we take a simple case of an election petition where the petitioner makes only one claim and that is that the election of the returned candidate is void. This claim can be made under section 100. Section 100(1) (a), (b) and (c) refer to three distinct grounds on which the election of the returned candidate can be challenged. We are not concerned with any of these grounds. In dealing with the challenge to the validity of the election of the returned candidate under section 100(1)(d), it would be noticed that what the election petition has to prove is not only the existence ,of one or the other of the rounds specified in clauses (i) to (iv) of section 100(1)(d), but it has also to establish that as a result of the existence of the said ground, the result of the election in so far as it concerns a returned candidate has been materially affected. It is thus obvious that what the Tribunal has to find is whether or not the election in so far as it concerns the returned candidate has been materially affected, and that means that the only point which the Tribunal has to decide is: has the election of the returned candidate been materially affected? And no other enquiry is legitimate or permissible in such a case. This requirement of section 100 (1) (d) necessarily imports limitations on the scope of the enquiry. Confining ourselves to clause (iii) of section 100(1)(d), what the Tribunal has to consider is whether there has been an improper reception of votes in favour of the returned candidate. It may also enquire whether there has been a refusal or rejection of any vote in regard to any other candidate or whether there has been a reception of any vote which is void and this can only be the reception of a void vote in favour of the returned candidate. In other words, the scope of the enquiry in a case failing under section 100(1)(d)(iii) is to determine whether any votes have been improperly cast in favour of the returned candidate, or any votes have been improperly refused or re 134 159 S.C. 5. 66 sected in regard to any other candidate. These are the only two matters which would be relevant in deciding whether the election of the returned candidate has been materially affected or not. At this enquiry, the onus is on the petitioner to show that by reason of the infirmities specified in section 100(1)(d) (iii), the result of the returned candidate 's election has been materially affected, and that, incidentally, helps to determined the scope of the enquiry. Therefore, it seems to us that it, the case of a petition where the only claim made is that the election of the returned candidate is void, the scope of the enquiry is clearly limited by the requirement of section 100(1)(d) itself. The enquiry is limited not because the returned candidate has not recriminated under section 97(1); in fact, section 97(1) has no application to the case falling under section 100(1)(d)(iii); the, scope of the enquiry is limited for the simple reason that what the clause requires to be considered is whether the election of the returned candidate has been materially affected and nothing else. If the result of the enquiry is in favour of the petitioner who challenges the election of the returned candidate, the Tribunal has to make a declaration to that effect, and that declaration brings to an end the proceedings in the election petition. There are, however, cases in which the election petition makes a double claim; it claims that the election of the re turned candidate is void, and also asks for a declaration that the petitioner himself or some other person has been duly elected. It is in regard to such a composite case that section 100 ' as well as section 101 would apply, and it is in respect of the additional claim for a declaration that some other candidate has been duly elected that section 97 comes into play. Section 97(1) thus allows the returned candidate to recriminate and raise pleas in support of his case that the other person in whose favour a declaration is claimed by the petition cannot be said to be validly elected, and these would be pleas of attack and it would be open to the returned candidate to take these pleas, because when he recriminates, he really becomes a counter petitioner challenging the validity of the election of the alternative candidate. The result of section 97(1) therefore, is that in dealing with a composite election petition, the Tribunal enquires into not only the case made out by the petitioner, but also the counter claim made by the returned 67 candidate. That being the nature of the proceedings con templated by section 97(1), it is not surprising that the returned candidate is required to make his recrimination and serve notice in that behalf in the manner and within the time specified by section 97 (1) proviso and section 97 (2). If the returned candidate does not recriminate as required by section 97, then he cannot make any attack against the alternative claim made by the petition. In such a case, an enquiry would be held under section 100 so far as the validity of the returned candidate 's election is concerned, and if as a result of the said enquiry a declaration is made that the election of the returned candidate is void, then the Tribunal will proceed to deal with alternative claim, but in doing so, the returned candidate will not be allowed to, lead any evidence because he is precluded from raising any pleas against the validity of the claim of the alternative candidate. It is true that section 101(a) requires the Tribunal to find that the petitioner or such other candidate for the declaration of whose election a prayer is made in the election petition has in fact received a majority of the valid votes. It is urged by Mr. Kapoor that the Tribunal cannot make a finding that the alternative candidate has in fact received a majority of the valid votes unless all the votes cast at the election are scrutinised and counted. In our opinion, this contention is not well founded. We have already noticed that as a result of rule 57, the Election Tribunal will have to assume that every ballot paper which had not been rejected under r. 56 constituted one valid vote and it is on that basis that the finding will have to be made under section 101(a). Section 97(1) undoubtedly gives an opportunity to the returned candidate to dispute the validity of any of the votes cast in favour of the alternative candidate or to plead for the validity of any vote cast in his favour which has been rejected; but if by his failure to make recrimination within time as required by section 97 the returned candidate is precluded from raising any such plea at the hearing of the election petition, there would be nothing wrong if the Tribunal proceeds to deal with the dispute under section 101(a) on the basis that the other votes counted by the returning officer were valid votes and that votes in favour of the returned candidate, if any, which were rejected. 68 were invalid. What we have said about the presumed validity of the votes in dealing with a petition under section 101 (a) is equally true in dealing with the matter under section 100(1)(d)(iii) We are, therefore, satisfied that even in cases to which section 97 applies, the enquiry necessary while dealing with the dispute under section 101(a) will not be wider if the returned candidate has failed to recriminate. If the returned candidate has recriminated and has raised pleas in regard to the votes cast in favour of the alternative candidate or his votes wrongly rejected, then those pleas may have to be tried after a declaration has been made under s, 100 and the matter proceeds to be tried under section 101(a). In other words, the first part of the enquiry in regard to the validity of the election of the returned candidate must be tried within the narrow limits prescribed by section 100(1)(d)(iii) and the latter part of the enquiry which is governed by section 101(a) will have to be tried on a broader basis permitting the returned candidate to lead evidence in support of the pleas which he may have taken by way of recrimination under section 97 (1). If Mr. Kapoor 's construction of section 100 (1) (d) (iii) is accepted, it would either make section 97 otiose and ineffective or make the operation of section 101 read with section 97 inconsistent with the operation of section 100 (1) (d) (iii). We are therefore satisfied that the High Court was right in coming to the conclusion that the Tribunal was in error in holding that "it was an authority charged with the duty of investigating the validity of votes for and against the petitioning and returned candidate or for a matter of that any other contesting candidate. " It, however, appears that following its own earlier decision in Inayatullah Khan 's(1) case the High Court was disposed to take the view that the enquiry under section 101(a) was wider and that in making its finding under the said provision, it was open to the Tribunal to scrutinise the votes and determine whether in fact, the petitioner or some other person had received a majority of the valid votes. As we have already indicated, this would be the position only if the returned candidate had recriminated; in the absence of recrimination, it would not be open to the Election Tribunal (1) 69 to allow the returned candidate to challenge the validity of votes cast in favour of the petitioner or any other candidate in whose favour a declaration is claimed by the election petition or to contend that any of his votes were improperly rejected. We ought to add that the view taken by the Madhya Pradesh High Court in the case of Inayatullah Khan(1) in regard to the scope of the enquiry under section 101 (a) does not correctly represent the true legal Position in that behalf. Similarly, the view taken by the Allahabad Court in Lakshmi Shankar Yadav vs Kunwar Sripal Singh and Ors. (2), cannot be said to interpret correctly the scope of the enquiry either under section 100 or section 101. The conclusion which we have reached in the present appeal is substantially in accord with the observations made by this Court in the case of Bhim Sen(3) though it appears that the points in question were not elaborately argued before the Court in that case. There is another point to which reference must be made. Mr. Garg contended that even if the view taken by the Tribunal about the scope of the enquiry under section 100 (1) (d) (iii) and section 101 was right, the relief granted by it was not justified by the pleadings of the appellant in the present proceeding In support of this argument, he referred us to paragraph 4 of the Special Pleas filed by the appellant, and relied on the fact that at the initial stage of the hearing, the Tribunal had framed 18 issues including issue No. 16 which consisted of three parts, viz. , (a) Whether any votes cast in favour of respondent No. 1 were wrongly rejected specially pertaining to polling station mentioned in para 4 of the written statement under heading special pleas? (b) Whether many votes were wrongly accepted in favour of the petitioner appertaining to the polling stations mentioned in para 4 of the special pleas in written statement? (c) What is the effect of the above in the case? (1)15 E.L.R.219. (3) E.L.R. 288. (2) 70 Later on, when the respondent contended that in the absence of any recrimination by the appellant these issues did not arise on the pleadings, they were struck out, and yet in its judgment the Tribunal has virtually tried these issues and given relief on grounds which were not included even in his written statement. Since this appeal was admitted mainly on the ground that the appellant wanted this Court to reconsider the observations made by it in the case of Bhin Sen(1), we do not propose to rest our decision on this subsidiary point raised by Mr. Garg. It now remains to refer to two decisions which were cited before us during the course of the arguments. In Vashist Narain Sharma vs Dev Chandra and Ors. (2), this Court has held that section 100(1)(c), as it then stood, places a burden on the objector to substantiate the objection that the result of the election has been materially affected by the improper acceptance or rejection of the nomination paper. In that connection, this Court observed that where the margin of votes is greater than the votes secured by the candidate whose nomination paper had been improperly accepted, the result is not only materially not affected but not affected at all; but where it is not possible to anticipate the result, the petitioner must discharge the burden of proving that fact and on his failure to do so, the election must be allowed to stand. In Hari Vishnu Kamath vs Syed Ahmed Ishaque and others(1), adverting to the expression "the result of the election" in section 100(1)(c), this Court stated that unless there is something in the context compelling a different interpretation, the said expression must be construed in the same sense as in section 66, and there it clearly means the result on the basis of the valid votes. Basing himself on this observation, Mr. Kapoor has urged that while the Tribunal decides the question as to whether the election of the returned candidate has been materially affected or not, the validity of the votes falls to be considered, and that inevitably enlarges the scope of the enquiry. We do not think that the observation on which Mr. Kapoor relies was intended to lay down any such proposition. All that the reference to section 66 denotes is that (1) (3) ; at P 1131. (2) ; 71 after considering the pleas raised, the Tribunal has to decide whether the election of the returned candidate has been materially affected or not, and that only means that if any votes are shown to have been improperly accepted, or any votes are shown to have been improperly refused or rejected, the Tribunal has to make calculations on the basis of its decisions on those points and nothing more. It is necessary to recall that the votes which have not been rejected by the returning officer under r. 56 have to be treated as valid, unless the contrary is specifically pleaded and proved. Therefore, we do not think that Mr. Kapoor is justified in contending that the observations in Hari Vishnu Kamath 's case support his plea that the enquiry under section 100(1)(d)(iii) is wide enough to take in the scrutiny of the validity of all voting papers. In Keshav Laxman Borkar vs Dr. Devrao Laxman Anande(1) this Court has pointed out that the expression " valid votes" has nowhere been defined in the Act, but in ,the light of the provision of section 3 6 (8 ) of the Act read with rule 58, two things are clear, first that the candidates are validly nominated candidates whose nomination papers are accepted by the returning officer after scrutiny, and second that the provision of section 58 provides that the ballot papers which are not rejected under r. 57 are deemed to be "valid ballot papers" and are to be counted as such. It appears that the position under the English Law in regard to the recounting of votes in proceedings under election petitions is substantially similar. As Halsbury points out: "where a petitioner claims the seat for an unsuccessful candidate, alleging that he had a majority of lawful votes, either party must, six days before that appointed for the trial, deliver to the master, and also at the address, if any, given by the other side, a list of the votes intended to be objected to and of the heads of the objection to each of those votes(1)". It further appears that no evidence may be given against the validity of any vote or under any head not specified in the list, unless by leave of the Court upon such terms (1) (2) Halsbury 's Laws of England, p. 306 paras. 553 & 554. 72 as to amendment of the list, postponement of the enquiry, and payment of costs as may be ordered. Where no list of the votes, to which it is intended to take objection, has been delivered within the time specified, the Court has no power to extend the time or to allow evidence of the votes objected to or of the objections thereto to be given at the trial. Therefore, it seems clear that in holding an enquiry either under section 100(1)(d)(iii) or under section 101, where section 97 has not been complied with, it is not competent to the Tribunal to order a general recount of the votes preceded by a scrutiny about their validity. In the result, the appeal fails and is dismissed. We would like to add that though we have accepted the construction of section 100(1)(d)(iii) and section 101 for which Mr. Garg contended, no relief can be granted to the respondent, because his application for special leave to appeal against the decision of the High Court has been dismissed since he was unable to make out a sufficient cause for condoning the delay made by him in preferring the said application. In the circumstances of this. case, we direct that the parties should bear their own costs. We ought to mention that when this appeal was argued before us on the 4th December, 1963, we were told that them fresh election which had been ordered to be held in accordance with the decision of the High Court was fixed for the 6th December, 1963; and so, after the case was argued, we announced our decision and intimated to the learned Advo cates that our reasons will follow. The present judgment gives the reasons for our decision. AYYANGAR J. While I agree that the appeal deserves, to be dismissed for reasons which I shall indicate later, I regret my inability to agree with the construction which my learned brethren have placed on section 100 (1) (d) (iii) of the Representation of the People Act which for shortness I shall call the Act. on which in ultimate analysis the question of law arising in the appeal turns. The facts of the case which have given rise to the proceeding as well as the points involved in the appeal have all been set out in detail in the judgment of Gajendragadkar J. and I consider it unnecessary to repeat 73 them. I shall accordingly state only those facts which are relevant for the purpose of: (1) the construction of section 100(1) (d) of the Act, and (2) the conclusion I have reached that the appeal should be dismissed. The appeal arises out of a contested election to the Morena Constituency of the Madhya Pradesh Legislative Assembly. The polling for the election took place on February 21, 1962 and there were as many as seven candidates who participated in that poll. The appeal is, however, concerned only with two of them Genda Lal and Jabar Singh the latter being the returned candidate and is the appellant before us. The voting procedure adopted was that set out in rule 39, Conduct of Election Rules, 1961, which I shall hereafter refer to as the Rules, under which the voter makes a mark on the ballot paper on or near the symbol of the contesting candidate to indicate his choice. On the first count of the ballot papers the Returning Officer computed the valid votes obtained by Genda Lal as 5,703 as against 5,671 which had been counted in favour of Jabar Singh. Jabar Singh, however, immediately applied for a recount under rule 63 of the 'Rules on the ground that the original scrutiny and counting were defective and this, though opposed, was acceded to by the Returning Office r who carried out a recount. I might mention in passing that the Election Tribunal has found discrepancies. even in the total of the number of ballot papers in some of the polling stations, the figures of the total number of valid votes in 6 polling stations being different from those found in the result sheet prepared under rule 57(2) in Form 20. The scrutiny and recount disclosed that Genda Lal was found to have polled 5,654 votes as against 5,656 votes counted as having been obtained by Jabar Singh. As a result of this recount Jabar Singh was declared elected, he having obtained 2 votes more than his rival Genda Lal. Genda Lal thereupon filed the election petition which has given rise to this appeal in which he sought to have the election of Jabar Singh declared void and also made a claim to the seat. The election was sought to be set aside on various grounds but we are concerned in this appeal 74 solely with one of the them viz., the correctness of the scrutiny and counting of votes at the recount vis a vis the petitioner and the returned candidate. Shortly stated, the allegation in this respect in the election petition was that 49 valid votes cast in favour of the petitioner (who is the respondent before us) were improperly rejected and that 32 votes were improperly accepted in favour of the returned candidate who is the appellant before us. Needless to add these allegations were denied by the returned candidate. Besides the denial, he also pleaded in his written statement that many votes cast in favour of himself had been wrongly rejected in regard to which details were given and that similarly several votes were wrongly accepted in favour of the election petitioner and in regard to which also details were given and it ended with the prayer that if a proper scrutiny and recount were made of the valid votes received by each, it would be found that he 'the returned candidate had. in fact, obtained a larger number of votes than the election petitioner and for this reason he submitted that the election petition ought to be dismissed. Though Genda Lal had by his election petition, besides seeking the relief of having the appellant 's election declared void, claimed the seat for himself under section 84 of the Act, none of the respondents to the petition including the appellant had filed any recrimination in conformity with the provisions of section 97 of the Act against the grant of such further relief and it is the effect of this failure on the rights of the parties that forms the principal point for consideration in the appeal. The Election Tribunal who inquired into the petition framed the necessary issues arising out of these pleadings. Issue 6(a) dealt with the allegation in the petition that 49 valid votes cast in favour of Genda Lal had been improperly rejected. After examining the evidence adduced and considering the validity of those votes in regard to which a dispute was raised, the Election Tribunal recorded the finding that not 49 but only 10 votes of Genda Lal had been improperly rejected. In regard to the question of the improper acceptance of 32 votes cast in favour of Jabar 'Singh which was covered by issue 6(b), the Tribunal found, again after going through the evidence in respect of the 'particular votes in dispute, that not 32 but only 4 had been 75 improperly accepted. The result of these findings on issues 6(a) and 6(b) was that the total number of valid votes polled by Genda Lal became 5,664 as against 5,652 polled by Jabar Singh. The Tribunal consequently held that the ,election of Jabar Singh who had obtained a minority of votes compared to Genda Lal must be declared void under section 100(1)(d)(iii). So far we are on non controversial ground except this that on this state of the voting Genda Lal claimed that he was entitled to the further relief that he be declared elected having obtained the majority of lawful votes satisfying the requirement of section 101(a). The Election Tribunal refused him that relief for reasons which it is unnecessary to set out ,or discuss and that decision having been affirmed by the High Court in appeal and the special leave prayed for to appeal from that decision of the High Court having been dismissed by us, the possibility of the disallowance of this additional relief does not require to be further noticed. The question about the scope of section 100(1)(d)(iii) and its relative place in the scheme of sections 97, 100 and 101 of the Act arises out of the plea made by Jabar Singh that without reference to the irregularities in the counting of the 49 and the 32 votes alleged by Genda Lal and which he had denied, and which were the subject matter of issues 6 (a) and 6 (b) to which I have already adverted, there were other irregularities in the scrutiny and counting which, if examined, would establish that after every error was eliminated, he himself had obtained a majority of 'lawful votes. The question of law that was debated before us was whether on the scheme of the Representation of the People Act, 1951, Jabar Singh was entitled to make such a plea and claim to adduce proof in support thereof in order to sustain his election without filing a recrimination under section 97 of the Act. My learned brethren have held that he could not and it is on that point that I do not find it possible to agree with them. The correct answer to this question would depend. it is common ground, on a proper construction of s.100(1)(d)(iii) read in conjunction with section 101(a). and 76 this I shall first consider. I shall next deal with the place and function of section 97 in this context and its bearing on the interpretation of the provisions on which the decision of this appeal turns. Though there have been a few decisions bearing upon the question of law I have indicated, and they have all been referred to by Gajendragadkar J. it is common ground that there is no binding decision of this Court touching the matter, though some observations in Bhim Sen vs Gopali and Ors.(1) would appear to favour the construction which my learned brethren have adopted. As, however, the appeal was placed before this Bench for the consideration of this question and we have proceeded on the basis that the matter is res integra I do not propose to refer to any of these decisions but shall proceed merely to interpret the provisions without advertence to the authorities to which our attention was invited during the course of the arguments. Section 100(1) (d) reads: "100. Grounds for declaring election to be void (1) Subject to the provisions of sub section (2) if the Tribunal is of o pinion. . . . . . . (d) that the result of the election, in so far as it concerns a returned candidate, has been materially affected (i) by the improper acceptance of any nomination, or (ii) by any corrupt practice committed in the interests of the returned candidate by an agent other than his election agent, or (iii) by the improper reception, refusal or rejection of any vote or the reception of any vote which is void, or (iv) by any non compliance with the provisions of the Constitution or of this Act or of any rules or orders made under this Act, the Tribunal (1) 77 shall declare the election of the returned candidate to be void. " The short question arising for consideration in this appeal may be stated thus: In the context of the provisions contained in section 100(1)(d) which permits an election of a returned candidate to be set, aside only on proof of the "result" viz., the election of the returned candidate having been "materially affected" by the improprieties or illegalities referred to in the four clauses numbered (i) to (iv) what is the import of the words "by the improper reception, refusal or rejection of any vote or the reception of any vote which is void". For our present purposes I might omit the reference to the latter part of this provision relating to "the reception of a vote which is void" and concentrate on the earlier part. It is manifest that the jurisdiction of the Tribunal to declare an election void arises only when it is of opinion that "the result of the election has been materially affected" by the defects or improprieties set out in cls. (i) to (iv), so that if notwithstanding that impropriety or illegality of the types set out in the four clauses, the result of the election is not materially affected, the returned candidate is entitled to retain his seat. With this preliminary observation I shall proceed to consider the import of the relevant words. "materially affected by the improper reception, refusal or rejection of any vote" first in a case where there is no complication arising from the petition claiming the seat in 'addition to the relief of having the election of the returned ,candidate declared void. The argument strenuously pressed before us by Mr. Garg learned counsel for the respondent was, that the Tribunal in considering whether the result of an election had been materially affected, was confined to the consideration of any impropriety alleged as regards the reception of the votes of the returned candidate as well as improprieties alleged by the petitioner in. the refusal or rejection of votes stated to have been cast in favour of the petitioner and the denials of these charges or allegations by the returned candidate. His further submission was that the returned candidate could not sustain his seat by showing a similar improper reception of votes in favour of the 78 petitioner or an improper refusal or rejection of his own votes. In other words, the argument was that the Tribunal dealing with a petition under section 100(1)(d) bad jurisdiction to proceed only on the allegations made in the petition and that even where a case had been established for a scrutiny, and a recount is ordered, it would be so confined and that its jurisdiction would not extend to cases of complaints by the returned candidate. It is this argument that I feel unable to accept. When an election petition is filed complaining of the improper reception or rejection of votes and praying for a scrutiny of the ballot papers for the purpose of determining whether the votes have been properly counted by the Returning Officer, the Tribunal would doubtless have to be satisfied that a case is made out for scrutiny and a re count, for it is settled law that the petitioner is not as a matter of right entitled to have such a scrutiny and recount merely because he prays for such a relief, but has to allege, make out and prove the specific grounds to establish that the scrutiny or counting was improper and that the return, was in consequence erroneous. If one reaches that stage and the Tribunal is satisfied that a case for scrutiny and recount is made out it would mean that the Returning Officer had not discharged his duties properly in the matter of the scrutiny of the ballot papers and their counting. If in such circumstances the respondent (the returned candidate ) also makes allegations of the same type regarding the scrutiny and the counting I consider it would be unjust to deprive him of the opportunity of proving his allegations and thus maintain his seat, unless of course, the statutory provision clearly precludes him from doing so. In saying this I am not suggesting that the respondent need make no averment in his pleadings making definite allegations regarding the particular votes regarding which he desires scrutiny and which he says have been wrongly counted either for or against him. Let us take a case where the allegation of the petitioner is that there has been a miscount i.e., a wrong counting of the votes of the returned candidate and nothing more. Let us suppose that A has been declared elected as having secured, say 200 votes as against B who has secured 190. If B in his election petition says that 79 A 's votes have been wrongly counted as 200, whereas, in fact, if they were recounted they would only be 180 and the Tribunal on a recount finds the allegation in the petition made out and that the returned candidate had obtained only 180 votes the acceptance of Mr. Garg 's argument would mean that the election of A would have to be set aside not withstanding that there has been a similar mistake in the counting of B 's votes and if these were properly counted they might not amount to more than 170. Mr. Garg submitted that though if B claimed the seat there would have to be a recount of the votes of both the candidates and this also, only in the event of a recrimination being filed under section 97, still if no seat was claimed the election 'of the returned candidate would be set aside and that the latter had no means whereby he could maintain his election notwith standing that as a fact he had obtained a majority of lawful votes. It is urged that this result flowed from the opening words of section 100(1)(d) which speaks of "the result of the election" being materially affected "so far as it concerns a returned candidate". I do not find it possible to agree with the construction or reasoning on which the submission is based. There is, no doubt, that an election petition is primarily concerned with the validity of the election of the returned candidate. It cannot also be disputed that the election of the returned candidate cannot be declared void, unless, confining oneself to the impropriety or illegality involved in the reception or refusal of votes, the returned candidate is proved to have obtained a minority of votes, for otherwise whatever be the impropriety or its degree or extensiveness, the result of the election would not be materially affected. It is common ground and beyond con troversy that the election petitioner is not restricted as regards the manner or details of the improper reception or refusal of votes which he could allege and prove which would achieve that result. If so much is conceded and is common ground, I do not see any force in the contention that the returned candidate is confined merely to disproving what is alleged to dislodge him from his seat and is for bidden from proving that votes which under the law had to 80 be counted in his favour, have been wrongly omitted to be so counted. The words in cl. (iii) do not impose any such restriction, for they speak of the "improper reception or refusal of any vote", and as the inquiry under section 100(1)(d) is for ascertaining whether the result of the election has been materially affected which in the context of cl. (iii) obviously means "the returned candidate has been proved not to have obtained, in fact, a majority of valid votes", there appears to me no scope for the argument pressed before us by Mr. Garg. On an analysis of the situation the position would appear to be this. Let us for instance assume that the voting procedure adopted in an election was that prescribed in rule 59 i.e., by placing the ballot papers in the ballot boxes set apart for the different contesting candidates. The returning officer counts the valid votes cast in the several boxes and declares A elected as having secured 200 votes as against B whose votes are counted as 198. If B files a petition and alleges that the counting was irregular, that the totals of the ballot papers in the result sheet are not properly computed, and that as a matter of fact A 's papers, if counted, would be 196, Mr. Garg 's submission is that though the discrepancy disclosed in the totals is consider able, A cannot prove that there has been a miscounting of B 's votes also, and that though if properly counted his total is only 190,, still A 's election should be set aside. It is said that the position would be different and the anomaly would be overcome in cases where the election petitioner, besides claiming a declaration that the election of the returned candidate is void, also seeks a further declaration that he should be declared duly elected and the returned candidate files a recrimination against such a prayer and challenges the right to have the further declaration. This, however, obviously furnishes no answer for more than one reason. It is the submission of Mr. Garg, and that is the whole basis upon which the construction which he desires us to adopt of section 100 (1) (d) (iii) turns, that the question raised by the recrimination arises only after the election of the returned candidate is declared void. Therefore we would have the anomalous situation wherein the election of the returned candiate is declared void by reason of his 81 not obtaining the majority of valid votes so far as the decision under section 100(1)(d) is concerned and then after the matter ,set out in the claim to the seat and the recrimination is inquired into and decided the election tribunal holds that the returned candidate had a majority of lawful votes but that this affected only the right of the defeated candidate to claim the seat. In my judgment the provisions of section 100 read with section 101 do not contemplate this position of a candidate 's election being set aside because he did not get a majority of lawful votes but in the same proceedings and as part of the same inquiry he being held to have obtained a majority of lawful votes. A construction of section 100 (1) (d) which would lead to this result must, in my opinion, be rejected as unsound. The apart, there is the further circumstance arising from 'the fact that according to Mr. Garg the enquiry in respect of a recrimination and its defence is identical with what he says is the scope of a petition and its defence. This, of course, is logical, but it suffers from the same anomaly which I have pointed out as resulting from the acceptance ,of the primary argument regarding the construction of section 100(1)(d)(iii). Applying what I have shown already regarding a case where there was no claim to a seat in an election petition in which the election of a returned candi date has to be declared void, notwithstanding that he had, in fact, obtained a majority of valid votes, because he is precluded from proving this fact, similarly in cases where a seat is claimed, the petitioner so claiming would have to be declared elected, notwithstanding that as a fact he has not obtained the majority of lawful votes, but that the returned candidate has obtained such a majority, because the latter is precluded from proving it. If one took a case where there were more candidates than two, the anomaly I have indicated would be seen clearly. If B files a petition against A the returned candidate claiming the seat and impleads as he must C & D who are the other contestants, 'no proof could be led by A to show that some of his own votes have been counted for C or D, though B would be entitled to prove that some of C 's or D 's votes have been wrongly counted as cast in favour of A. In such a case 134 159 S.C. 6. 82 it is obvious that B gains no advantage by recriminating, because recrimination under section 97 could only be against A and not against the other contesting candidates impleaded as respondents. The result, therefore, would be that though, in fact, A has obtained the majority of lawful votes, B, the petitioner, will be declared elected recrimination or no recrimination. I cannot accept the position that either section 100(1)(d)(iii) or section 101(a) contemplate this result which is at once so unjust and anomalous and appears to me. to contradict the basic principles underlying election law viz., (1) that apart from disqualification, corrupt practices etc. , the election of a candidate who obtains the majority of valid votes shall not be set aside, and (2) no candidates shall be declared duly elected who has not obtained the majority of valid votes. I would add that the entire argument proceeds on a mis conception of the procedure involved in a scrutiny. I will take the case where the voting takes place, as in the case of the election before us, in accordance with the provisions of rule 39. Then conformably to Rule 57(3) all the ballot papers which have been held to be valid in each polling station are bundled up and sealed by the Returning Officer, and similarly all the rejected ones of each station are made into another bundle. At the scrutiny by the Tribunal these two sets of bundles are examined to find out whether the votes cast in favour of each of the contesting candidates have been properly counted or not. How this can be done compartmentally, as those cast for A or B or C separately as is suggested by Mr. Garg, I am unable to follow. If the votes cast in favour of each candidate were made into separate bundles, then at least, there might be scope for an argument that the bundle of A or B shall not be opened up, but when all the voting papers have to be scrutinised in order to find out (a) whether the returned candidate has really been proved to have received a minority of valid votes and (b) whether the candidate claiming the seat has obtained a majority of valid votes, this cannot obviously be done without an examination of the ballot papers to which objection is taken and which are contained in the two types of bundles into which these are made up under rule 57(3). 83 Support was sought by Mr. Garg for the construction that he sought to press upon us by reference to the provisions in the other sub clauses of section 100 (1) (d). His point was that if the returned candidate could not put forward the objections contained in those clauses the returned candidate could not likewise allege improprieties in the reception of the votes of any other candidate including the petitioner. I am wholly unimpressed by this argument which does not take into account both the nature of the objections in these other clauses as well as their bearing on the question whether the election of the returned candidate has been materially affected, which is the prime question for consideration in the provision and which furnishes the key to the interpretation of the sub clause now under consideration. Let me take each of the cases provided by the other sub clauses. Sub cl. (i) deals with the improper acceptance of a nomination. It is obvious that allegations and proof by the returned candidate regarding the improper acceptance of a nomination cannot serve to sustain his election. A fortiori so, clause (ii) which reads "(ii) by any corrupt practice committed in the interests of the returned candidate by an agent other than his election agent, or" could have no meaning in the present context nor cl. (iv) unless the non compliance has a bearing on the reception of votes in which case it would be wholly covered by cl. (iii). In the case of cls. (i), (ii) and (iv) it is obvious, having regard to the very nature of the provisions, that the returned candidate can do no more than prove (a) that there was no such impropriety or illegality as is alleged, and (b) that even if there was, the same had not affected the result of his election; in other words, that the impropriety or illegality, if any, was inconsequential so far as his election was concerned. But this would not be the position in regard to the improper reception or rejection of votes. There we have two factors: (1) the impropriety of the reception or rejection, and (2) whether as a result of such improper reception or rejection the result was materially affected. In the case contemplated by cl. (iii) the question whether the result was materially affected or not could not, when 84 the facts are ascertained, be a matter of doubt or dispute but would be one merely of arithmetical calculation and comparison. No doubt, section 100 of the Act casts on the election petitioner the onus of establishing to the satisfaction of the Tribunal that "the result of the election was materially affected" by the impropriety etc., and taking the case of cl. (iii) in hand, of improper reception or rejection of particular votes, but from this it does not follow that the returned candidate is powerless to establish to the satisfaction of the Tribunal that notwithstanding the improper reception or rejection of the particular votes alleged by the petitioner his election has not been materially affected. The argument of Mr. Garg, if accepted, would mean that the returned candidate can merely combat the case alleged against him and is disabled from establishing positively that the result of the election has not been materially affected. If the key words of the provision on the fulfilment of which alone the Tribunal is invested with jurisdiction to set aside an election are taken to be the words "The result of the election has been materially affected. " I do not consider that it is possible to contend that it is beyond the power of the returned candidate to establish this fact which he might do in any manner he likes. He might do this by establishing that though a few votes were wrongly counted as in his favour, still a larger number of his own votes were counted in favour of the petitioner or that votes which ought to have been counted as cast for him, have been improperly counted as cast in favour of defeated candidates other than the petitioner. Without such a scrutiny it would manifestly not be possible to determine whether the election of the returned candidate has been materially affected or not. Nor do I see anything in the language of cl. (iii) which precludes the returned candidate from establishing this. This clause employs the words "improper reception, refusal or rejection of any vote" to confine oneself to its first part. No doubt, when a petitioner complains of a rejection, he obviously means an improper rejection of votes in his own favour and when he speaks of an improper reception he means also obviously an improper reception of votes in favour of the returned candidate. But from this it does not follow that there might not be an improper reception of votes in favour 85 of the election petitioner or of another candidate or of an improper rejection of votes of the returned candidate the clause does not speak of the person in whose favour or as against whom the improper reception or rejection has taken place, its content and significance have to be ascertained from the purpose for which the provision is intended viz., to determine from a counting of the voting papers after a scrutiny whether the election of the returned candidate has been materially affected. For instance, let me take a case within section 100(1)(d)(i) where there has been an improper acceptance of any nomination. The question arises as to whether the election of the returned candidate has been materially affected by that improper acceptance. Obviously, a nomination which is alleged to have been improperly accepted and which is the subject of the charge under s.100 (1) (d) (i) is not the acceptance of the nomination either of the election petitioner where he has been one of the candidates or of the returned candidate but only of one of the other defeated candidates. If after inquiry the nomination is found to have been improperly accepted and the Tribunal proceeds to inquire as to its effect on the election, I take it, it would necessarily have to consider the votes received by that candidate. If this is not to be done it would either mean that in every case of an improper acceptance of a nomination the election is to be declared void or that in no case can such a declaration be made. Now, if the votes cast in favour of that candidate whose nomination was improperly accepted have to be counted, necessarily there has to be a scrutiny and the Tribunal would have to inquire and ascertain the number of valid votes cast for that candidate in order to determine whether the improper reception of votes in favour of that candidate has materially affected the result of the election i.e., has resulted in the election of the returned candidate. In that context the scrutiny of the improper reception of the votes in favour of such candidate would obviously have to take place and that could be done only by virtue of the provision in section 100 (1) (d) (iii). This would at least show that the expression of "any vote" in the clause has to be read as meaning 'any vote cast in the election with which the petition is concerned ' and not 'any vote cast in favour of the returned 86 candidate ', to take the illustration merely of the improper reception of a vote. The construction which I have placed on section 100(1)(d) (iii) would harmonise the provision contained in the opening words of section 100 (1) (d) and section 101 (a). I cannot reasonably conceive of the law providing (unless of course the language employed leaves me no alternative) for the setting aside of an election of the returned candidate because the Tribunal finds that he did not receive the highest number of valid votes cast at the election; but that after this stage is over and the Tribunal proceeds to consider whether the claim to the seat is made out or not its reaching the finding that such a petitioner is not entitled to that relief because on further scrutiny, the returned candidate had, in fact, secured the highest number of votes. Mr. Garg, no doubt, contemplated this anomaly with equanimity suggesting that it was due not to any anomaly at all but a situation arising merely from the application of different tests or being the result of inquiries directed to different ends at different stages of the petition. It is this that I am unable to reconcile myself to. The language used in section 101 (a) is, no doubt, "in fact received the majority of the valid votes". I do not, however, consider that the use of the words 'in fact ' involves scrutiny of a type different from that which the Tribunal conducts for ascertaining whether by reason of the improper reception or rejection of votes the election of a returned candidate has been materially affected so as to justify its being set aside. The inquiries are identical. If every vote which has been improperly received is eliminated and every vote which has been improperly refused or rejected is added you get the totality of the valid votes cast in favour of a candidate. That is precisely the inquiry which is prescribed to be conducted under section 100(1)(d) read with cl. (iii). The words 'in fact ' used in section 101 (a) to my mind do not add any new element as regards either the scrutiny or the counting. If so, on the construction which I have endeavored to explain, when once it is ascertained that the returned candidate has obtained a majority of valid votes there is no question of his election having to be set aside. But it might be shown that he had not obtained the 87 majority of valid votes. in other words, by the scrutiny that has taken place in order to test the validity of his election the Tribunal might have arrived at a conclusion that he had not received the majority of valid votes. Immediately that stage is reached and that conclusion is arrived at the Tribunal proceeds to declare the election void. If there, is no claim to a seat there is nothing more to be done, with the result that it stops with declaring the election void in which event there would be a re election. If, however, the seat is claimed by a defeated candidate or on his behalf there has to be a further inquiry which the Tribunal is called upon to conduct. For the purpose of declaring the election void the Tribunal would have arrived at the figures, ,of the valid votes cast in favour of the several candidates. It might be that the petitioner who made the claim to the. seat or the person on whose behalf that is made might not have obtained the highest number of valid votes in which ,case, of course, a claim to the seat would be rejected. It is this situation which is indicated by section 101(a). It provides that there cannot be a declaration in favour of the claimant to a seat merely because the election of the returned candidate has been declared void but he must in addition have secured the majority of the lawful votes cast. A question might arise as to how this total is to be ascertained. It is obvious that for this purpose the Tribunal ought to scrutinise not merely the ballot papers of the claimant and the returned candidate but also of the other candidates. Thus, for instance, taking the case only of the petitioner who is a claimant, among the votes counted in his favour might be some which were really votes east in favour of a defeated candidate and similarly votes properly cast for him might have been improperly counted as the votes of the other defeated candidates. Undoubtedly the irregularities would have to be pleaded, but I am now concerned with whether even if pleaded, the Tribunal would on a proper interpretation of sections 100 and 101 have jurisdiction to entertain the pleas and embark on such a scrutiny. Proceeding then on the footing that the necessary averments have been made in the pleadings filed there would have to be a scrutiny of the ballot papers before it can be ascertained whether or not the, person who or on whose behalf the seat is claimed has obtain 88 ed a majority of valid votes in order to sustain the claim to. the seat. After this stage is passed and the Tribunal has reached the conclusion that the claimant has, in fact, received the majority of valid votes that the Tribunal embarks on the further inquiry as to whether there are any reasons why he should not be declared elected. And it is at this stage that the provisions of section 97 in regard to recrimination come into play. If no recrimination is filed then on the terms, of section 101(a) the claimant would be immediately declared elected but if there is a recrimination then section 101(b) is attracted and the Tribunal would have to inquire whether if the claimant were a returned candidate there are circumstances in which his election could be declared void. This, would indicate that the recrimination is concerned with a stage which emerges after the scrutiny is completed and assumes that the scrutiny has resulted in the claimant being found to have obtained the majority of valid votes. This construction would harmonise the provisions of sections 97, 100 (1(d) and 101 and would lead to a rational result. This brings me to a submission based upon rule 5 7 (1) to which reference was made by Mr. Garg. He referred us to the words of that rule reading: "Every ballot paper which is not rejected under Rule 56 shall be counted as one valid vote" as throwing some light on the construction of section 100(1)(d) (iii) and as favouring the intrepretation which he invited us to put upon the provision. I consider that the rule has no bearing at all upon the point now in controversy. Rule 57 occurs in Part V of the Rules beginning with rule 50 which is headed 'Counting of votes in Parliamentary and Assembly Constituencies. ' Rule 55 prescribes the scrutiny at the time of the opening of the ballot boxes and rule 56 with the scrutiny and rejection of ballot papers. This last rule lays down which shall be deemed to be a valid vote on a ballot paper and which is not and directs the Returning Officer to follow these directions and make the counting. And it is in that context that we have rule 57 and the provision in sub r. It obviously means only that so far as the Returning Officer is concerned and for the purpose of enabling him to declare the result the ballot papers which are not rejected are to be 89 deemed as valid. It is manifest that if that validity held good even at the stage of the election petition and for the conduct of the inquiry before the Tribunal, that could really be no scrutiny of the ballot papers and section 100 (1) (d) (iii) would become meaningless. The meaning of rule 57(1) is only this that ballot papers not rejected shall be deemed to be valid so far as the Returning Officer is concerned and even as regards himself it is subject to the provision in rule 63 under which a recount may be demanded and granted. His decision has, of course, prima facie validity at the stage of the inquiry by the Election Tribunal because the impropriety of his acceptance or refusal has to be pleaded and proved by the party objecting to this scrutiny and it is only if the Tribunal finds the impropriety established, that the vote would be differently treated or counted. It appears to me to be clear therefore that rule 57 does not bear upon the construction of section 100(1)(d)(iii) or of section 101 (a) for which purpose reliance was placed upon it. The next question that arises is the result of the construc tion which I have endeavoured to explain of the relevant provisions of the Act and now I shall set out a few further findings of the Election Tribunal which bear upon the point next to be considered. The Election Tribunal found after a scrutiny of the voting papers to which objection had been made by the petitioner Genda Lal and on a recount that it resulted in Genda Lal having obtained 5,664 votes as against 5,652 obtained by the returned candidate Jabar Singh which meant that the election of Jabar Singh should be declared void. The Tribunal then proceeded to investigate the allegations made by Jabar Singh as regards the improper reception of votes in favour of Genda Lal and the improper rejection of votes in his own favour and after considering the ballot papers of the several polling stations, it arrived at the result that Genda Lal had been improperly credited with 10 votes and that Jabar Singh had been im properly denied the benefit of 12 votes cast in his favour. If this position could be sustained the result would be that Genda Lal had obtained 5,654 votes as against 5,664 votes polled by Jabar Singh which would mean that the election of Jabar Singh could not be declared void, for "the result of the election had not been materially affected. " It was this 90 that was strenuously urged before us by Mr. Kapoor learned counsel for the appellant Jabar Singh. Both the Tribunal as well as the High Court on appeal therefrom have held that because Jabar Singh had not recriminated this deduction of 10 votes in favour of Genda Lal and the addition of 12 votes in favour of Jabar Singh could not be made and consequently denied to the appellant the benefit of this finding. In view of what I have stated earlier as to the proper construction of sections (100)(1)(d)(iii) and 101(a) the absence of recrimination could not lead to this result and if this finding could be sustained I would have allowed the appeal. But this finding of the Tribunal has proceeded partly without any pleading to support it. When an objection is taken to the improper reception or refusal of a vote the facts upon which such impropriety has occurred have to be set out and the other party has to be given an opportunity to meet the case. Though there might be no express requirement of the Act or any rule made thereunder, I consider that it is implicit in the pleadings required to be filed under sections 81 to 83 of the Act read with the frame of section 100 that a party who alleges an impropriety or error in the scrutiny by the Returning Officer, and needless to add this would apply to every allegation of impropriety or illegality by whosoever committed, must specify with particularity the grounds of attack on the action of the Returning Officer in regard to the scrutiny of the ballot paper or the counting. In the present case it is admitted that though in his written statement, the appellant Jabar Singh challenged the propriety of the reception of certain votes in favour of Genda Lal and the improper rejection of some of his own votes, he did not specify all of these in regard to which impropriety has been found by the Tribunal. The Tribunal has, as I have already stated, found that 10 ballot papers whose numbers have been specified ought not to have been counted in favour of Genda Lal. But of these, it is now admitted, that in regard to 6 of them no plea had been made in the written statement, with the result that only 4 votes could be taken into account as having been wrongly counted, bearing in mind the pleading in the case. Similarly, as regards the rejection of Jabar Singh 's votes the Tirbunal, as stated eariler, has found that 12 votes ought to have been counted in his favour. Of these, however, the written statement con 91 tained allegations only as regards 6 and not as regards the rest. This would mean that the Tribunal had no jurisdiction to find that more than 6 votes had been improperly rejected in his case. If the votes regarding which no plea of impro priety had been raised by Jabar Singh were eliminated, it would follow that as a result of the final scrutiny Genda Lal had obtained properly 5,660 valid votes as against 5,658 polled by Jabar Singh. The result of the election, therefore, was materially affected by the improper reception or refusal of votes and therefore I consider that the election of Jabar Singh was properly set aside and that is why I concur in the order that the appeal should be dismissed. Appeal dismissed.

The appellant was 'declared elected having defeated the respondent by 2 votes. Thereafter, the respondent filed an election petition. The respondent challenged the validity of the appellant 's election on the ground of improper reception of votes in favour of the appellant and improper rejection of votes in regard to himself. His prayer was that the appellant 's election should be declared void and a declaration should be made that the respondent was 'duly elected. The appellant urged before the Tribunal that there had been improper rejection of his votes and improper acceptance of the votes of the respondent, and his case was that if recounting and re scrutiny was made, it would be found that he had secured a majority of votes. The respondent objected to this course; his case was that since the appellant had not recriminated nor furnished security under section 97 of the Act, it was not open to him to make this plea. The Tribunal rejected the objection of the respondent and accepted the plea of the appellant. The Tribunal re examined the ballot papers of the respondent as well as the appellant and came to the conclusion that 22 ballot papers cast in favour of the respondent had been wrongly accepted. The result was that the respondent had not secured a majority of votes. The Tribunal declared that the election of the appellant was void and refused to grant a declaration to the respondent that he had been duly elected. Both the appellant and the respondent preferred appeals before the High Court against the decision of the Tribunal. The High Court dismissed both the appeals and the decision of Tribunal was confirmed. Hence the appeal. Held: (i) The scope of the enquiry in a case falling under section 100 (1) (d) (iii) is to determine whether any votes have been improperly cast in favour of the returned candidate or any votes have been improperly refused or rejected in regard to any other candidate. These are the only two matters which would be relevant in 'deciding whether the election of the returned candidate has been materially affected or not. At this enquiry the onus is on the petitioner to prove his allegation. Therefore, in the case of a petition where the only claim made is that the election of the returned candidate is void, the scope of the enquiry is clearly limited by the requirement of section 100 (1)(d) itself. In fact, section 97(1) has no application to the case falling under section 100(1)(d) (iii); the scope of the enquiry is limited for the simple reason that what 55 the clause requires to be considered is whether the election of the returned candidate has been materially affected and nothing else. (ii) There are cases in which the erection petition makes a double claim; it claims that the election of a returned candidate is void and also asks for a declaration that the petitioner himself or some other person has been duly elected. It is in regard to such a composite case that section 100 as well as section 100(1) would apply, and it is in respect of the ,additional claim for a declaration that some other candidate has been duly elected that section 97 comes into play. Section 97(1) thus allows the returned candidate to recriminate and raise pleas in support of his case. The result of section 97(1) therefore, is that in dealing with a com posite election petition the Tribunal inquires into not only the case made out by the petitioner, but also the counter claim made by the returned candidate. In this connection the returned candidate is required to comply with the provisions of section 97(1) and section 97(2) of the Act. If the returned candidate does not recriminate as required by section 97, then he cannot make any attack against the alternative claim made by the petitioner. In other words the returned candidate will not be allowed to lead any evidence because he is precluded from raising any pleas against the validity of the claim of the alternative candidate. (iii) The pleas of the returned candidate under section 97 of the Act,have to be tried after a declaration has been made under section 100 of the Act. The first part of the enquiry in regard to the validity of the election of the returned candidate must be tried within the narrow limits prescribed by section 100(1)(d) (iii) and the latter part of the enquiry which is governed by section 101(a) will have to be tried on a broader basis permitting the returned candidate to lead evidence in support of the pleas which he may have taken by way of recrimination under section 97(1). But ,even in cases to which section 97 applies, the enquiry necessary while dealing with the dispute under section 101(a) will not be wider if the returned candidate has failed to recriminate, and in a case of this type the duty of the Election Tribunal will not be to count and scrutinise all the votes cast at the election. As a result of r. 57, the Election Tribunal will have to assume that every ballot paper which had not been rejected under r. 56 constituted one valid vote and it is on that basis the finding will have to be made under section 101(a). Therefore, it is clear that in holding an enquiry either under section 100(1)(d) (iii) or under section 101 where section 97 has not been complied with it is not competent to the Tribunal to order a general recount of the votes preceded by a scrutiny about their validity. Inayatullah Khan vs Diwanchand Mahajan, and Lakshmi Shankar Yadav vs Kunwar Sripal Singh, overruled. Bhim Sen vs Gopali and Ors. , relied on. Vashist Narain Sharma vs Dev Chandra, ; , Hari Vishnu Kamath vs Syed Ahmed Ishaque, [1955] 1 S.C.R. 1104 and 56 Keshav Laxman Borkar vs Dr. Devrao Laxman Anande, , 'discussed. Per Ayyangar J. (i) Section 100 of the Act casts on the election petitioner the onus of establishing to the satisfaction of the Tribunal that "the result of the election was materially affected by the improper reception or rejection of particular votes", but from this it does not follow that the returned candidate is powerless to establish to the satisfaction of the Tribunal that notwithstanding the improper reception or rejection of the particular votes alleged by the petitioner his election has not been materially affected. If the key words of the provision on the fulfillment of which alone the Tribunal is invested with jurisdiction to set aside an election are taken to be the words "the result of the election has been materially affected"; it is not beyond the power of the returned candidate to establish this fact which he might do in any manner he likes. The returned candidate might do this by establishing that though a few votes were wrongly counted as in his favour, still a large number of his own votes were counted in favour of the petitioner or that votes which ought to have been counted as cast for him, have been improperly counted as cast in favour of defeated candidates other than the petitioner. Without such a scrutiny it would manifestly not be possible to determine whether the election of the returned candidate has been materially affected or not. There is nothing in cl. (iii) which precludes the returned candidates from establishing this. As this clause does not speak of the person in whose favour or as against whom the improper reception or rejection has taken place, its content and significance have to be ascertained from the purpose of which the provision is intended viz., to determine from a counting of the voting papers after a scrutiny whether the election of the returned candidate has been materially affected. The expression "any vote" in this clause has to be read as meaning "any vote cast in the election with which this petition is concerned" and not "any vote cast in the favour of the returned candidate". (ii) Section 101(a) provides that there cannot be a declaration in favour of the claimant to a seat merely because the election of the returned candidate has been declared void but he must in addition have secured the majority of the lawful votes cast. It is obvious that for this purpose the Tribunal ought to scrutinise not merely the ballot papers of the claimant and the returned candidate but also of the other candidates. When the Tribunal has reached the conclusion after scrutiny of votes that the claimant has, in fact, received the majority of valid votes, the Tribunal embarks on the further enquiry as to whether there are any reasons why he should not be declared elected And it is at this stage that the provisions of section 97 in regard to recrimination came into play. If no recrimination is filed then on the terms of section 101(a) the claimant would be immediately declared elected but if there is recrimination the provision of section 101(b) is attracted. This construction would harmonise the provision of sections 97, 100(1)(d) and 101. and would lead to a rational result. 57 (iii) Rule 57(1) means that so far as the returning officer is concerned and for the purpose of enabling him to declare the result the ballot papers which are not rejected are to be deemed as valid. It is manifest that if that validity held good even at the stage of the election petition and for the conduct of the enquiry before the Tribunal that could really be no scrutiny of the ballot papers and section 100(1)(d) (iii) would become meaningless. The validity of the Ballot Paper can be challenged in Election Petition by making proper pleadings and the Tribunal can declare any ballot paper as improperly received. Rule 57 does not bear upon the construction of section 100(1)(d) (iii) or of section 101(a).

ivil Appeal Nos. 256 of 1985 and 4875 of 1984. From the Judgment and Order dated 24th August, 1984 of the Bombay High Court in Writ Petition. 4232 of 1983. Ram Jethmalani, Khatu Cooper, S.B. Bhasme, Ms. Rani Jethmalani, Tushad Cooper, G. Subramaniam, Ashok Sharma, Ajai Singh Chandal, V.S. Desai, A.S. Bhasme, A.M. Khanwilkar for the appearing parties. K. Parasaran, Attorney General, P.H. Parekh and Ms. Indu Malhotra for the Interveners. The Judgment of the Court was delivered by OZA, J. These two appeals were heard by us and by our order dated March 10, 1986 we maintained the judgment of the High Court and dismissed both the appeals, by this order we modified the order 894 for compensation which was passed by the High Court. Our reasons for the same are: The necessary facts for the disposal of these appeals are that the appellant in one of the appeals before this Court who was the third petitioner before the High Court is a private limited company incorporated for the purposes of carrying among others the business of exporting frozen meat of buffaloes, sheep and goats. The Al Kabeer Exports Pvt. Ltd. alongwith other two took initiative in the business and obtained an import licence, a project being 100% export oriented. The licence they obtained stipulated the entire production of the plant to be exported for 10 years and the construction and the operation of the project were to be according to the standards of hygiene prevailing in the European Economic Community Countries and of the U.S. Foods and Drugs Administration. The plant was to be equipped with the most modern equipments. The petitioners selected a site of agricultural lands in village Savandhe in Bhiwandi Taluka of Thane District, comprised in Survey No. 40/2, 41, 42, 44, 45 and 70 totally admeasuring about 68,327 square metres. This site was included in "U" Zone in the Bombay Metropoli tan Regional Plan for the period from 1970 to 1991 prepared under the Bombay Metropolitan Region Development Authority Act, 1974, "U" Zone denoting that the land was future urban isable area. The site is situated at a distance of 2 kilometres from Bhiwandi Town having Muslim majority which has been a trou ble spot for communal riots for past some years, with the surrounding villages of Savandhe, Gorsai, Shelar, Chavindra, Pogoan and Bhorpada situate at a distance of 1/2 kin, 1 km, 1/2 Inn, 11/2 km, 2 km, and 2kms. respectively. These vil lages have a population of about 400, 1500, 3000, 2500, 500 and 1500 respectively, majority of the population of all these villages being Hindus. This site is situated on the bank of river Kamawari whose water is used for the purposes of drinking and washing by the inhabitants of the surround ing villages and where the Hindus from Bhiwandi and the aforesaid surrounding villages immerse their Ganesh idols on the Ganpati Immersion Day. After selecting the site the petitioners obtained the requisite permission from the relevant authorities and on 4.4.1980 they obtained permission from the Sarpanch of the Group Gram Panchayat of Savandhe which certificate stated that if the land comprised in the site of the plant was converted into non agricultural plot in favour of the peti tioner, the Panchayat would not have any objection what 895 soever as it will increase the income of the Panchayat. Petitioners (High Court). obtained the consent from the Maharashtra Prevention of Water Pollution Board under Sec tion 28 of the Maharashtra Prevention of Water Pollution Act, 1969 to discharge the effluents from the proposed plant in the water pollution prevention area of Ulhas River basin as notified under Section 18 of the Act subject to certain terms and conditions. The proposed plant was registered as an industry by ' the Director General of Technical Develop ment on 8th January 1981. On 11.8.80 Collector Thane was approached for permission to use the land for non agricul tural purposes for the said plant under Section 44 of the Maharashtra Land Revenue Act, 1966. Collector granted the said permission by his order dated 5.4.1982 subject to certain terms and conditions. It appears that thereafter some trouble started and the villagers round about Bhiwandi town which included also the villages mentioned above addressed a complaint to one Shri Sadanand Varde, M.L.A. from Bombay, making the following grievances: (i) that the construction of the abattoir has been started without the permission of the Gram Panchayat, (ii) that cows, bulls and buffaloes were to be slaughtered in the abattoir, (iii) the abattoir was likely to pollute the air giving rise to diseases endangering the health of the villagers, (iv) that discharge of effluent from the abattoir in the river would pollute the river water which was used for drinking both by the villagers and cattle thereby endangering the life of the villagers as well as the cattle which is the means of livelihood of the villagers, (v) that the prices of land would be reduced on account of pollution thereby preventing the industrial development of the villages and (vi) the religious feelings of the Hindus in Bhiwandi town and the villages would be hurt since the effluents from the abattoir would be discharged in the river where traditionally Hindus were immersing their Ganesh idols. The villagers therefore prayed that under no circum stances, the abattoir should be permitted. Shri Varde in his turn alongwith a letter dated 24th January, 1983 forwarded the said complaint to the Revenue Minister of the State Government with a request to consider the objections of the villagers and to stop the construction in the meanwhile. On the basis of this letter it appears that the Government on 17.2.83 called for a report in the matter from the Collector Thane who in turn called a report from the Tehsildar Thane and Tehsildar Thane in his turn issued a notice to all the parties including the promoters of this project and on 7.3.83 'recorded the statements of respective parties in cluding Shri Rizwan Bubere, the holder of a General Power of Attorney and the Tehsildar sent his report on the same day to the Collector. In the 896 meantime on 5.4.83 a detailed representation was received against the venture (abattoir) by the Revenue Minister of the State from the Sarpanch of Savandhe Gorsai Group of Gram Panchayat and others. In this representation more or less similar grounds as were initially raised in representation to the M.L.A. were raised. The Government by its order dated 28th April, 1983 directed the petitioners to stop the con struction work for a period of 15 days pending investigation and on 30th April, 1983 the Government directed the Commis sioner, Konkan Division to submit his detailed report on the complaint received from the villagers by holding an on the spot inspection. The Commissioner made enquiries and on the spot inspection on 9th and 11th May, 1983, submitted his report on 17th May, 1983, it was received by the Govern ment on 18th May, 1983. By order dated 25.5.1983 Government further stayed the construction for a period of one month. On 7th June, 1983 Al Kabeer Exports Pvt. Ltd. and others filed a petition before the High Court challenging the order of stay granted by the Government and obtained an ad interim stay of the Government 's order pending admission of the Writ Petition. Government filed their affidavit on 13.6.83 and stated that the Government was reconsidering the matter and ultimately by order dated 14.6.83 High Court admitted the writ petition and continued the interim relief of stay granted but Government was directed to pass its final orders in the matter. On 16.8.1983 one Dr. Vyas filed his Writ Petition before the High Court being No. 2717 of 1983 challenging the order dated 5.4. 1982 of Additional Collector, Thane grant ing permission to the petitioners for converting the land to non agricultural use and prayed for stoppage of construction work and on the same day ad interim stay was granted by the High Court. It appears that on a statement made by the GoVernment counsel that Government would take a final deci sion in the matter on or before 15 10.83 the Court modified its interim order passed earlier and permitted construction work to continue at the risk of the persons concerned with out prejudice to the writ petition. On 7th October, 1983 the Government issued a show cause notice in its revisional jurisdiction under Section 257 of the Code and on 14.10.83 the petitioners were supplied with the grounds on which the Government proposed to revise the order of Additional Collector, Thane. The appellants herein replied to the show cause notice, and the grounds by their written submissions dated 2.11.83. Hon 'ble Minister heard the revision on the same day and by his order dated 25.11.1983 897 set aside the order of Additional Collector and cancelled the permission granted to the appellants to use the land for purposes of their said project. In the meanwhile, on 18.11.83 violent riots had taken place directed against the setting up of the abattoir in the village Savandhe and in the clashes of rioters with the police personnel 4 persons were killed, many others injured, and property was damaged to a considerable extent. Against the decision of the Minis ter cancelling the permission granted by Additional Collec tor the petition was filed in the High Court on 5.12.83 under articles 226 and 227 of the Constitution for quashing the decision of the Government and it is that petition which gave rise to the present two appeals. The main question which was raised before the High Court and also before us about the scope of Section 257 of the said Revenue Code and power of State Government in exercise of revisional jurisdiction. It was also incidentally raised that revisional powers could not be exercised beyond 90 days. Grounds under Article 19(1)(g) also were raised. The learned Judges of the High Court have examined the scope of Sections 44 and 257 of the Revenue Code in detail and after considering all the facts and circumstances came to the conclusion that the Government had the power to revise even suo motu orders passed by Additional Collector and found that the grounds on the basis of which the Government acted existed and therefore the action on the part of the Govern ment was bonafide and in public interest although the learned Judges felt that the Government did not act dili gently but still in the public interest the High Court maintained the order passed by the Government with the directions to compensate the persons concerned. Mainly it is on this ground that the learned Judges of the High 'Court have maintained the order passed by the Government. After hearing arguments at length, in our opinion, the view taken by the High Court appears to be correct. We see no reason to interfere with the view taken by the High Court, as we have observed earlier. We therefore dismissed both the appeals. P.S.S Appeals dismissed.

The petitioner appellant carrying on the business of exporting frozen meat of buffaloes, sheep and goat, sought to establish an abattoir, meat processing plant and a cold storage in a riots prone area near Bombay. The site was situated on the bank of a river whose water is used for purposes of drinking and washing, besides religious usage, by the inhabitants of the surrounding villages. The Sarpanch of the Group Gram Panchayat granted no objection certifi cate. The District Collector granted permission to use the land for non agricultural purposes for the said plant under s.44 of the Maharashtra Land Revenue Code, 1966 on April 5, 1982. At this stage the villagers raised objections to the setting up of the plant and made a representation to the Revenue Minister alleging that construction of the abattoir and discharge of effluent from the abattoir into the river would pollute the river water which was used for drinking purposes. The Government issued a show cause notice to the appellants on October 7, 1983 under s.2S7 of the Code for ,cancellation of the order of the District Collector. The Minister heard the revision and by his order dated November 25, 1983 set aside the order of the District Collector. Aggrieved by the said order the appellants fried a petition in the High Court under articles 226 and 227 of the Constitution for quashing the decision of the Government cancelling the permission. The High Court upheld the order of the Government but directed it to pay compensation for the cost incurred in setting up the project up to October 7, 1983, being the date when show cause notice was issued. 893 The petitioners appealed to this Court by special leave against upholding of the impugned order while the State preferred the appeal ' by special leave against the direction for payment of the compensation. Dismissing the cross appeals this Court confirmed the judgment of the High Court upholding the order of the Gover ment. It also held the appellants entitled to compensation in lieu of costs incurred on the project and interest on the compensation amount for the period subsequent to October, 7, 1983. Pronouncing the reasons, the Court, HELD: The High Court has examined the scope of ss.44 and 257 of the Maharashtra Land Revenue Code, 1966 in detail and after considering all the facts and circumstances came to the conclusion that the Government had the power to revise even suo moto orders passed by the Collector and found that the grounds on the basis of which the Government acted existed and, therefore, the action on the part of the Gov ernment was bona fide and in public interest, although it did not act diligently, but still in public interest the High Court maintained the order passed by the Government with the direction to compensate the persons concerned. The view taken by the High Court appears to he correct. There is no reason to interfere with it. [879D F]

Civil Appeal No. 1800 of 1968 From the Judgment and order dated 20 10 1967 of the Delhi High Court in Civil Writ No. 1376 of 1967. section N. Kacker, Sol. Genl., section N. Anand and R. N. Sachthey for the Appellant. V. M. Tarkunde and Gautam Goswami for Respondent No. 1. Yogeshwar Prasad and (Mrs.) Rani Chhabra for the Interveners. Ex parte against Respondents Nos. 2 and 3. 72 The Judgment of the Court was delivered by KOSHAL, J. The facts giving rise to this appeal by the Delhi Administration on certificate granted by the High Court of Delhi against its judgment dated the 20th October 1967 in a petition under articles 226 and 227 of the Constitution of India (Civil Writ Petition No. 1376/ 67) are not in dispute and may be briefly stated. The Governments of the States of Punjab and Delhi entered into an agreement about 3() years back providing for the running of public service vehicles in routes which covered each of the two States so that every one of such routes had one terminus in one of the States and the other in the other. In pursuance of the agreement one of the Governments would issue permits under the (hereinafter referred to as the Act) and the same would be counter signed by the other State before the former plied its buses on the routes covered by such permits. One such permit related to the Delhi Karnal route and was countersigned by the State Transport Authority Delhi in the following terms: "Countersigned for the portion of the route Delhi Karnal from 31 7 1967 to 30 11 1967 subject to the condition that tickets will be issued for the destinations bet wen Delhi and Karnal. Destination board should be exhibited. Bus will cover the full route and all other conditions applicable under Motor Vehicle Laws. " Other permits for the Delhi Karnal route and other interstate routes were counter signed in the same terms. The routes above mentioned were extended by the Punjab State authorities under permits granted by them for intra State routes connecting different towns in the State of Punjab itself. Thus a permit was issued in favour of the Punjab roadways for the route from Karnal to Chandigarh so that the bus operating on the Delhi Karnal route would carry passengers from Delhi to Chandigarh via Karnal. On the 25th July 1956, officers of the two States came to an agreement whereby the State of Punjab was given the right to extend its services on inter State routes to any town in the State of Punjab. This agreement was subject to ratification by the Governments of the Two States, which`was, however, never accorded. In the year 1966, the State of Delhi objected to the exploitation by the State of Punjab of the inter State routes in the manner above stated, that is, by extending them beyond the termini specified in that behalf under the counter signatures made by the State of Delhi and approached the Inter State Transport Commission (hereinafter called the commissions) constituted under sub section (1) of Section 63A of the Act with 73 a request for interference. After hearing counsel for the two States the Commission passed an order dated 27th August, 1966, in favour of the State of Delhi. 'the operative part of that order alongwith the reasons listed by the Commission in support of it is extracted below: "Section 48(2) of the , prescribes that every stage carriage permit shall be expressed to B. be valid only for a specified route or routes of for a specified area. It appears, therefore, that if a permit is expressed to be valid only for the one specified inter State route, the same transport vehicle covered by the same inter State permit can not be allowed to proceed further to another route with liberty to pick up passengers in route on a second route, which is C: an intra State route, as this would be in violation of the provisions of the Act. There is no objection to the same vehicle running on another route under a different permit, but it would be objectionable if passengers who embark on the route covered by the inter State permit are given direct tickets to any town on the second route for which the vehicle holds on intra State permit. The issue of scull a direct ticket would amount to extending the span to the inter State route, which is not permissible under the . In other words, there can be no objecting to the linking of the two routes but this linking should not involve boarding of direct passengers, i.e., those holding one ticket for travel over both the routes on either of the two routes. "On a careful consideration of the provisions of the , the Commission advise under Section 63A(2) (b) of the , that it would not be in order if one vehicle operating on two permits for two routes were to book direct passengers travelling on both the routes on direct tickets for places on both the routes. Operations which would contravene this advice should be stopped and the services be so regulated to ensure that the provisions of the are not violated " The State of Punjab went up in appeal to the Inter State Trans port Appellant Tribunal (hereinafter called the 'Tribunal) under rule 24 of the Inter State Transport Commission Rules, 1960. That appeal was dismissed on the 4th July 1967 through an order, paragraph 3 to 7 of which may be re produced for facility of reference: "3. The learned counsel for the Delhi Administration replied that the issue of tickets was a condition of a permit under Section 48(3) (xiv) of the . The 6 520SCI/78 74 inter State permit from Delhi to Karnal was, therefore, subject to the condition that tickets bearing specified particulars shall be issued to passengers and shall show the fares actually charged. This must be construed to mean that the ticket which is issued as a condition attaching to a single permit would be restricted to the route or routes covered by that permit. As the inter State route alone is covered by the permit which is countersigned by the Delhi Administration, the said permit would require the issue of a ticket only on the Delhi Karnal route but not beyond. We think that the contention of the Delhi Administration is further supported by Section 42(1) of the under which no owner of a "transport vehicle" (which includes a stage carriage) shall use the vehicle in any public place, save in accordance with the conditions of a permit granted or countersigned by a Regional or a State Transport Authority authorising the use of the vehicle in that place in the manner in which the vehicle is being used. The vehicle starting from Delhi on the Delhi Karnal route would be governed by the conditions of the inter State permit countersigned by the Delhi Administration. The use of the vehicle at Delhi or, for the matter of that, at any place on the inter State route, must be governed by the conditions of the inter State permit alone. We have already construed session 48(3) (xiv) to mean that the tickets which must be issued as a condition of the permit must relate to the route or routes or area covered by that permit. It would follow therefore that tickets to be issued from Delhi could not be for any place which was beyond Karnal and, therefore, not covered by the inter State permit. Learned Counsel for the Government of Punjab submitted that the Delhi Administration has countersigned only the inter State route covered by a permit issued by the Government of Punjab with the knowledge that the same permit was valid floor a further intra State route also. however, cannot mean that the Delhi Administration are estopped from contending that under the conditions of the inter State permit, a ticket for a place beyond the Inter State route cannot be issued. From the point of view of the convenience of the passengers, we would have liked the vehicle starting from Delhi to issue a long distance ticket to a place even beyond 75 Karnal so that the passengers starting from Delhi could A be assured of reaching their destination beyond Karnal. Unfortunately, the attainment of this objective has been fettered by the existing provisions of the referred to above. For the above reasons, therefore, we are of the view that the advice given by the Inter State Transport Commission was, on the whole, correct, though we have taken the liberty of adding to the reasons on which the advice could be supported. The appeal is, therefore, dismissed." This order of the Tribunal was challenged by the State of Haryana (which had been carved out of the erstwhile State of Punjab in the meantime) in the petition under Articles 226 and 227 of the Constitution of India which we have mentioned above and which has been accepted by a Division Bench of the High Court of Delhi. The High Court took note of the various provisions of the Act and concluded that there was no warrant for the proposition that tickets could not be issued at Delhi for stations beyond Karnal by the Haryana Roadways for a bus operating under a permit in respect of the Delhi Karnal route and that the Commission and the Tribunal had both erred in holding to the contrary. The High Court observed that under clause (xiv) of sub section (3) of Section 48 of the Act, the Delhi State could impose conditions subject to which its countersignature in relation to a permit covering an inter state route was to be valid, but added that such. conditions could only be those which were covered by that clause and no others. It further found that no condition preventing the permit holder from issuing a direct ticket from Delhi to Chandigarh via Karnal was ever imposed by the State Transport Authority, Delhi, and also that such a condition could not be imposed inasmuch as (a) the same would not be relatable to the inter State route and (b) it would not be covered by clause (xiv) aforesaid. It turned down a plea that the issuance of tickets from Delhi to Chandigarh by the Haryana Roadways affected the identity of the Delhi karnal route or amounted to its extension. In the result, therefore, the High Court issued a writ of certiorari quashing the orders of the Commission and the Tribunal and restrained the Delhi Administration from interfering with the operation of the Stage carriages of the State of Haryana on the Delhi Haryana inter state routes on the plea that the issue of direct tickets beyond the terminal stations in Haryana on those routes was prohibited either by the provisions of the Act or by any condition attached by the State Transport Authority, Delhi. Before us, the contentions raised on behalf of the appellant are: (1) The Regional Transport Authority, Delhi, had the power under sub sec. (2) of Sec. 63 read with clause (xiv) above mentioned to impose, while according its counter signature to a permit relating to an inter State route, a condition to the effect that tickets shall not be issued for any station beyond the two specified termini and such a condition could be spelt out of the counter signature above extracted by necessary implication. (2) The counter signatures covered only inter State routes having specified termini and the issuance of tickets by the Haryana Roadways for stations beyond the terminus located in the Haryana State and specified in a particular permit (which has been countersigned by the Delhi State authorities) amounted to an extension of the route which the Act did not permit. We find no force in either of these contentions for the reasons which follow and which are substantially the same as advanced by the High Court in the detailed judgment under appeal. Sub section (2) of Section 63 of the Act states: "(2) A Regional Transport authority when countersigning the permit may attach to the permit any condition which it might have imposed if it has granted The 'permit, . and may likewise vary any condition attached to the permit by the Authority by which the permit was granted. " The conditions which a Regional Transport Authority may attach to a permit while granting it are contained in clause (xiv) above mentioned which runs thus: (xiv) that tickers bearing specified particulars shall be is sued to passengers and shall show the fares actually charged and that records of tickets, issued shall he kept in a specified manner;" According to this clause, the conditions attached to the grant of a permit may be (a) that the tickets issued to passengers shall bear specified particulars; 77 (b) that the tickets shall show the fares actually charged; A and (c) that records of the tickets issue(l shall be kept in the manner specified. None of these conditions embraces a restriction on the permit holder that he shall not ply his vehicle beyond the specified inter state route even if that is done under another permit which is valid according to law, and we, therefore, do not see how clause (vix) as above extracted read with sub sec. (2) of section 63 of the Act helps the case of the appellant. Nor can we agree with the plea that the counter signature above extracted could be construed as laying down a condition that the permit holder could not ply his vehicle beyond the specified terminus in the State of Haryana. Learned counsel for the appellant has laid emphasis on the words "Tickets will be issued for the destinations between Delhi and Karnal. Destination boards should be exhibited," and wants us to interpret them as implying a prohibition on the use of the concerned vehicles beyond Karnal. We are of the opinion, however, that no such interpretation can be placed on them. They merely lay down positive instructions which the permit holder had to carry out, namely, that he would not refuse the issue of a ticket between the two termini, i.e., Delhi and Karnal, and that he would also exhibit a board stating that the vehicle in question would cover the route from Delhi to Karnal. Beyond that the words do not go and cannot be construed to mean that the vehicle could not ply beyond p Karnal or that a board saying that it was going to Chandigarh via Karnal cloud not be exhibited, or that tickets could not be issued for any stations except those lying between Delhi and Karnal. In fact, the authority counter signing the permit had no concern at all with any route beyond Karnal. The playing J of the vehicle from Karnal to Chandigarh would be governed not by the permit covering the Delhi Karnal route or by the counter signature on it but by another permit issued by the authority competent to deal with the route between Karnal and Chandigarh. The first contention raised on behalf of the appellant is, therefore, found to be without substance. We also find no force in the plea that the plying of vehicles by the Haryana Roadways beyond the inter State route under valid permits issued by the competent authority would amount to an 78 "extension" of the route such as is prohibited by the Act. Reliance in support of the plea was placed on sub section (8) of section 57 of the Act which lays down: "(8) An application to vary the conditions of any permit, other than a temporary permit, by the inclusion of Ba new route or routes or a new area or, in the case of a stage carriage permit, by increasing the number of trips above the specified maximum or by altering the route covered by it or in the case of a contract carriage permit or a public carrier 's permit, by increasing the number of vehicles covered by the Permit, shall be treated as an application for the grant of a new permit: Provided that it shall not be necessary so to treat an application made by the holder of a stage carriage permit who provides the only service on any route Or in any area to increase the frequency of the service so provided, without any increase in me number of vehicles. " As pointed out by the High Court, the language of the sub section applies only to a case where the permit holder applies for the variation of the conditions of his permit by inclusion of a new route or routes or a new area or by increasing the number of services above the specified maximum. In the case before us this situation does not arise at all inasmuch as the Haryana Roadways has not applied for the variation of any permit in any way and has, on the other hand, taken and exploited quite another permit for an entirely different route from another competent authority. Apart from sub sec. (8) above mentioned, we have not been referred to any provision of the Act in support of the plea under consideration which, therefore, fails. Learned Counsel for the appellant drew our attention to a Possible unfortunate situation which might result from the conclusions which the High Court has reached and, in our opinion, reached rightly. His apprehension was that in order to make more money and to avoid inconvenience to itself the Haryana Roadways, while operating under the permit pertaining to the Delhi Karnal route, would perhaps not issue any tickets to passengers bound for stations lying II in between Delhi and Karnal so long as it could find customers travelling directly from Delhi to Chandigarh and that in that event the real purpose of the counter signature would be wholly defeated. We 79 would certainly not approve of such a situation but then it is nobody 's A case that the Haryana Roadways has been plying its buses on the Delhi Chandigarh route or, for that matter, any other route, in that fashion. However, we may make it clear that if any long distance passengers are given preference over those leaving Delhi for a station lying between the termini specified in any permit bearing the countersignature of the Delhi State authorities, a peremptory condition attach ed to the counter signature would have been violated, and that State would be entitled to take such action as may be open to it under the law. subject to this observation, the appeal fails and is dismissed, but with no order as to costs. S.R. Appeal dismissed.

The Governments of the States of Punjab and Delhi entered into an agreement about 30 years back providing for the running of public service vehicles on routes which covered each of the two States so that every one of such routes had one terminus in one of the States and the other in the other. In Pursuance of the agreement one of the Governments would issue permits under the and the same would be countersigned by the other State before the former plied its buses on the routes covered by such routes. One such permit related to the Delhi Karnal route and was countersigned by the State 'Transport Authority, Delhi. The routes were extend d by the Punjab State authorities under permits granted by them for intra state routes connecting different towns in the State of Punjab itself. Thus a permit was issued in favour of the Punjab Roadways for the route from Karnal to Chandigarh so that the bus operating on the Delhi Karnal route would carry passengers from Delhi to Chandigarh via Karnal. In 1966, the appellant objected to the exploitation by the State of Punjab of the inter State routes in the manner above stated, that is, by extending them beyond the termini specified in That behalf under the counter signatures made by the State of Delhi, and approached the Inter State Transport Commission constituted under section 63 A of M.V. Act With a request for interference. The Commission answered it in favour of the appellant State, and held that it would not be in order that if one vehicle operating of two permits for two routes were to book direct passengers travelling on both the routes. Operations which would contravene this advice should be stopped and the services be so regulated to ensure that the provisions of the are not violated". The State of Punjab went up in appellate to the Inter State Transport Appellate Tribunal under rule 24 of the Inter State Transport Commission Rules 1960. The appeal was dismissed and the respondent State filed a writ petition in the Delhi High Court which was allowed by the Division Bench. Dismissing the appeal by certificate the Court, ^ HELD: (1) According to clause (xiv) of sub section (3) of section 48 of the Motor Vehicles Act, 1959, the conditions attached to the grant of permit, under section 63(2) ibid, may be; (a) that the tickets issued to passengers, shall bear specified particulars; (b) that the tickets shall show the fares actually charged; and (C) that records of the tickets issued shall be kept in the manner specified. None of these conditions embraces a restriction on the permit holder that he shall not ply his vehicles beyond the specified inter state route even if that is done under another permit which is valid according to law and, therefore, clause (xiv) of section 48(3) read with section 63(2) of the Act will be of no avail. [76H, 77A C] 71 (2) 'The words "Tickets will be issued for the destinations between Delhi and Karnal. Destination boards should be exhibited" merely lay down positive instruction which the permit holder had to carry out, namely, that he would not refuse the issue of a ticket between the two termini, i.e, Delhi and Karnal. and that he would also exhibit a board stating that the vehicle in question would cover the route from Delhi to Karnal. Beyond that the words do not go and cannot be construed to mean that the vehicle could not ply beyond Karnal or that a board saying, that it was going to Canceling via Karnal could not be exhibited, or that tickets could not be issued for any stations except those lying between Delhi and Karnal. In fact, the authority counter signing the permit had no concern at all with any route beyond Karnal. The plying to the vehicle from Karnal to Chandigarh would be governed not by the permit covering the Delhi Karnal route or by the counter signature on it by another permit issued by the authority competent to deal with the route between Karnal and Chandigarh. [77D H] (3) The plying of vehicles by the Haryana,. Roadways beyond the inter state route. under valid permits issued by the competent authority does not amount to an "extension" of the route such as is prohibited by the Act. [77H. 78A] The language of sub section (8) of section 57 of the Act applies only to a case Where the permit holder applies for variation of the conditions of his permit by inclusion of a new route or routes or a new area or by increasing the number of services above the specified maximum In the instant case, this situation does not arise at all inasmuch as the Haryana. Roadways has not applied for The vacation of any permit in any way and has, on the other hand, taken and exploited quite another permit for an entirely different rout from another competent authority. [78E F] OBSERVATlON: [If any long distance passengers arc given preference over those leaving Delhi for a station Lying between the termini; specified in any permit bearing the counter signature of the Delhi state authorities. a peremptory condition attached to the counter signature would have been violated and that State would l be entitled to take such action as may be open to it under the law].

Appeal No. 1020 of 1966. Appeal by special leave from the judgment and order dated October 28, 1965 of the Allahabad High Court, Lucknow Bench in Second Appeal No. 356 of 1964. R. K. Garg and D. P. Singh, for the appellant. section section Shukla, for respondent No. 1. The Judgment of the Court was delivered by Mitter, J. The only question in this appeal by special leave is, whether there was a violation of Rule 7 of the United Provinces Legislative Department Rules in the appointment of the first respondent, section N. Dixit, as the Superintendent in the Legislative Assembly of the State of Uttar Pradesh in preference to the appellant. The facts are as follows. The appellant was appointed as an Upper Division Assistant (formerly known as superior service assistant) in the Legislative Assembly Secretariat Uttar Pradesh in 1954 on the result of a competitive examination held by the Public Service Commission of the State. He was confirmed in the post of Upper Division Assistant with effect from June 16, 1955. In September 1961 a vacancy occurred in the post of a Superintendent in the Legislative Assembly Secretariat. The first respondent was working as a Treasurer in the same office. According to the appellant, one Uma Shanker was the senior Upper Division Assistant and he was immediately after Uma Shanker in order of seniority. In view of the fact that Uma Shanker had not put in the minimum period of ten years ' service as Upper Division Assistant the Speaker of the Assembly did not think it fit to appoint him as Superintendent but he ignored the appellant 's claim to the post after Uma Shanker and appointed Dixit in violation of the mandatory provisions of Rule 7. The said Rule reads : "Recruitment to the post of the Superintendent shall be made by promotion from the grade of superior service assistants in the Council Department. While due regard will be paid to seniority, no assistant will be appointed to the post of Superintendent unless he is considered qualified in all respects to perform the duties of a Superintendent and full authority will be reserved to appoint the assistant most fitted for the post. If, 423 however, no suitable assistant is available for promotion from amongst the grade of superior service assistants in the Council Department, recruitment may, as a special case, be made from outside. " The appellant filed a suit in the court of the Munsif of South Lucknow impleading the State of Uttar Pradesh, the Speaker, Legislative Assembly of the State and Dixit as defendants therein and praying for a decree for declaration that he should be deemed entitled to the post of Superintendent in the Legislative Assembly with effect from 1st January 1962 and a further declaration that the order dated October 7, 1961 appointing defendant No. 3 as Superintendent was illegal and ultra vires. Written statements were filed on behalf of the defendants. The learned Munsif held in the,plaintiff 's favour. His judgment was upheld in appeal by the Civil Judge Lucknow. The same was reversed in Second Appeal to the High Court. The order of the Speaker passed in October 1961 shows that he had considered the matter carefully before appointing Dixit to the post. The contention of learned counsel for the appellant was 'that the post could not be given to a person who was not a superior service Assistant and the "grade of superior service assistants in the Council Department" meant and included only those persons whose names were borne on the roll of Upper Division Assistants. exhibit 10 the gradation list of permanent ministerial establishment of the Uttar Pradesh Legislative Assembly Secretariat as it stood in April 1956 shows. that the scales of pay of Upper Division Assistants, Translators, Reference Clerk, Treasurers, Stenographer to Secretary and Assistant Librarian were the same, namely, Rs. 160 15 280 EB 20 400. By an order of the Governor dated March 16, 1959 efficiency bars in the scales of pay of all the above posts were uniformly altered and fixed at Rs. 220 and Rs. 300. The High Court took the view that 'grade ' in R. 7 was suggestive of status and it did not refer to a class or a particular class. According to the High Court "All officials working in the same scale of pay in a department, although holding posts with different desig nations, shall be deemed to be holding posts in the same grade, because their rank in the same. department will be the same and equal to one another. " The High Court noted that the dictionary meaning of "grade" was 'rank ' position in scale, a class or position in a class according to the value. ' In our view the High Court came to the correct conclusion in holding that the post was a selection post and seniority by itself was not a sufficient qualification for promotion. The Speaker had to take into consideration the claims of Senior. 424 Upper Division Assistants but under the rules his choice was not limited to the Upper Division Assistants. He could consider the claims of others who were in the same grade, that is to say, enjoying the same scales of pay and pick out the person considered by him to be qualified in all respects to perform the duties of a Superintendent. All officials of the Legislative Assembly Secretariat holding posts in the same scale of pay as Upper Division Assistants were eligible for promotion to the post of the Superintendent Counsel argued that this would be an unreasonable interpre tation of the rule for in that case even a book binder or a chauffeur would have to be considered if their scales of pay were the same as those of Upper Division Assistants. We do not think that anyone would place such an absurd construction on the rule. The appointing authority had to consider not only the eligibility based on the grade (assuming that the rules unreasonably place a chauffeur, a book binder, an accountant and a special duty clerk in the same grade) but also the qualification of the person appointed to perform the duties of the Superintendent and a book binder or a chauffeur would certainly not be eligible for ,consideration. It was said that the educational qualification of the appellant was much superior to that of Dixit and while the appellant had joined service by passing a competitive examination held by the Public Service Commission the first respondent had failed to pass such a test. These are matters on which we can express no opinion. As noted already, the Appointment was made after a thorough scrutiny of representations received and after consideration of the recommendation made by the Secretary ,of the Legislative Department. In the result the appeal is dismissed, but we make no order as to costs. G.C. Appeal dismissed.

According to r. 7 of the United Provinces Legislative Department Rules recruitment to the post of Superintendent shall be made by promotion from 'the grade of superior service assistants in the Council Department '. While regard was to be shown to seniority full authority was reserved to appoint the assistant most fitted for the post and when no suitable assistant was available recruitment might be made from outside. The appellant entered the service of the U.P. Legislative Assembly in 1954 through a competitive examination held by that Public Service Commission of the State. In 1955 he was confirmed in the post of Upper Division Assistant. In September, 1961 a vacancy occurred in the post of a Superintendent in the Legislative Assembly Secretariat. The first respondent who was working as a Treasurer in the same office in the same scale of pay as the appellant was appointed to the said post by the Speaker of the Assembly. Being aggrieved by the rejection of his claim as the senior qualified superior service assistant the appellant filed a suit in the court of the Munsif. The Munsif decreed the suit in his favour but the District Judge in first appeal and the High Court in second appeal decided against him. According to the view taken by the High Court the word 'grade ' in r. 7 meant the scale of pay, and therefore all persons on the same scale of pay as a superior service assistant were qualified for the post of Superintendent in whichever department and under whatever designation they might be working. In appeal by special leave before this court, HELD : The post of Superintendent was a selection post and seniority by itself was not a sufficient qualification. The Speaker had taken into consideration the claims of the senior Upper Division Assistants but under the rules his choice was not limited to the Upper Division Assistants. He could consider the claims of others who were in the same grade, that is to say, enjoying the same scale of pay and pick out the person considered by him to be qualified in all respects to perform the duties of a Superintendent. The High Court bad rightly held that all officials of the U.P. Legislative Assembly Secretariat holding posts in the same scale of pay as Upper Division Assistants were eligible for promotion to the post of Superintendent. [423H 424B] The danger that on the above interpretation persons like book binders and chauffeurs, if they were getting a salary in the game grade as the senior service assistants would be eligible for the post, was imaginary, for in making appointment to a selection post the qualifications of a person would certainly have to be considered. [424D] The fact that the appellant entered service through a competitive examination while the respondent had failed to pass such a test was not one SupCI/69 13 422 which could be taken into consideration by this Court because the appointment was made after thorough scrutiny of representations received and after consideration of the recommendation made by the Secretary of the Legislative Department. [424E]

ivil Appeals Nos. 929. 930 and 931 of 1963. Appeals by special leave from the judgment and decree dated October 11, 1961 of the Punjab High Court in Regular First Appeals Nos. 136, 137 and 138 of 1959. Hans Raj Sawhney and B.C. Misra, for the appellant (in all the appeals). B.R.L. lyengar, S.K. Mehta and K.L. Mehta for the respondents (In C.A. No. 229 of 1963). V.D. Mahajan, for the respondent. (In C.A. No. 930 of 1963). Kanwar Rajendra Singh and Vidya Sagar Nayyar, for the respondent (In C.A. No. 931 of 1963). The Judgment of the Court was delivered by Subba Rao, J. These appeals by special leave raise a question, of limitation. The National Bank of Lahore Limited, hereinafter called the Bank, is a banking concern registered under the Indian Companies Act and having its registered office in Delhi and branches at different places in India. Though its main business is banking, it carries on the incidental business of hiring out lockers out of cabinets in safe deposit vaults to constituents for safe custody of their jewels and other valuables. It has one such safe deposit vault at its branch in Jullundur. The respondents herein hired lockers on rental basis from the Bank at Jullundur through its Manager under different agreements on different dates during the year 1950. in April 1951 the said lockers were tampered with and the valuables of the respondents kept therein were removed by the Manager of the Jullundur branch of the Bank. In due course the said Manager was prosecuted before the Additional District Magistrate, Jullundur, and was convicted under sections 380 and 409 of the Indian Penal Code. The respondents filed 3 suits in the Court of the Subordinate Judge, Jullundur, against the Bank for the recovery of different sums on account of the loss of the valuable contents of the lockers hired by them. The Bank denied its liability on various grounds and also contended that the suits were barred by Iimitation. The learned Subordinate Judge held that the Bank was liable to bear the loss incurred by the plaintiffs and that the suits were not barred by limitation. On appeal, the High Court of Punjab accepted the findings of the learned Subordinate Judge on both the questions and dismissed the appeals. The present appeals arise out of the said judgment of the High Court. The only question raised in these appeals is one of limitation. Before considering the question of limitation it is necessary 295 notice briefly the findings of fact arrived at by the High Court. The High Court summarized its findings thus: (1) The whole object of a safe deposit vault in which customers of a Bank can rent lockers for placing their valuables is to ensure their safe custody. The appellant Bank had issued instructions and laid down a detailed procedure for ensuring that safety but in actual practice the Manager alone had been made the custodian with full control over the keys of the strong room and a great deal of laxity had been observed in having no check whatsoever on him. (2) The lockers had been rented out to the plaintiffs by the Manager Baldev Chand, who was entrusted with the duty of doing so. It was he who had intentionally rented OUt such lockers to the plaintiffs which had been tampered with by him. This constituted a fraud on his part there being an implied representation to the plaintiffs that the lockers were in a good and sound condition. (3) Although the Bank authorities were not aware of what Baldev Chand was doing. but the fraud, which he perpetrated, was facilitated and was the result of the gross laxity and negligence on the part of the Bank authorities. (4) The lockers were indisputably being let out by the Manager to secure rent for the Bank. Having found the said facts, the High Court held that the fraud was committed by the Manager acting within the scope of his authority and therefore, the Bank was liable for the loss incurred by the respondents. Then it proceeded to consider the question of limitation from three aspects, namely. (i) the loss was caused to the respondents. as the Manager of the Bank committed fraud in the course of his employment; (ii) there was a breach of the implied condition of the contract. namely, that only such lockers would be rented out which were safe and sound and which were capable of being operated in the manner set out in the contract; and (iii) there was a relationship of bailor and bailee between the respondents and the Bank, and therefore the Bank would be liable on the basis of the contract of bailment. It held that from whatever aspect the question was approached article 36 of the First Schedule to the Limitation Act would be out of place and the respondents ' claims would be governed by either article 95 or some other article of the Limitation Act. Learned counsel for the appellant accepted the findings of fact, but contended that on the facts found the suits were barred by limitation. Elaborating the argument the learned counsel pointed out that the theft of the valuables by the Manager was a tort committed by him dehors the contracts entered into by the appellant with the respondents and. therefore, article 36 of the First Schedule 296 to the Limitation Act was immediately attracted to the respondents ' claims. The scope of article 36 of the First Schedule to the Limitation Act is fairly well settled. The said article says that the period of limitation "for compensation for any malfeasance, misfeasance or nonfeasance independent of contract and not herein specifically provided for" is two years from the time when the malfeasance, misfeasance or nonfeasance takes place. If this article applied, the suits having been filed more than 2 years after the loss of the articles deposited with the Bank, they would be dearly out of time. Article 36 applied to acts or omissions commonly known as torts by English lawyers. They are wrongs independent of contract. Article. e 36 applies to actions "ex delicto" whereas article 115 applies to actions "ex contractu". "These torts are often considered as of three kinds, viz. non feasance or the omission of some act which a man is by law bound to do, misfeasance, being the improper performance of some lawful act, or malfeasance, being the commission of some act which is in itself unlawful". But to attract article 36 these wrongs shall be independent of contract. The meaning of the words "independent of contract" has been felicitously brought out by Greer, L.J. in Jarvis vs Moy, Davies, Smith, Vanderveil and Co.(1) thus: "The distinction in the modern view, for this purpose, between contract and tort may be put thus. Where the breach of duty alleged arises out of a liability independently of the personal obligation undertaken by contract it is tort and it may be tort even though there may happen to be a contract between the parties, if the duty ' in fact arises independently of that contract. Breach of contract occurs where that which is complained of is a breach of duty arising out of the obligations undertaken by the contract. " If the suit claims are for compensation for breach of the terms of the contracts, this article has no application and the appropriate article is article 115, which provides a period of 3 years for compensation for the breach of any contract, express or implied, from the date when the contract is broken. If the suit claims are based on a wrong committed by the Bank or its agent dehors the contract, article 36 will be attracted. Let us now apply this legal position to the claims in question. One of the contracts that was entered into between the plaintiffs and the Bank is dated February 5, 1951. It is not disputed that the other two contracts, with which we are concerned, also are of the same pattern. Under that contract the Bank, the appellant herein, and Sohanlal Sehgal, one of the respondents herein, agreed "to hire, subject to the conditions endorsed, the company 's safe No. 1651/ 405. 297 2203 Class lower for one year from this day at a rent of Rs. 40". The relevant conditions read as follows: It is agreed that the connection of the renter of the safe and the Bank (and it has no connection) is that of a lessor and lessee for the within mentioned safe and not that of a banker and customer. The liability of the company in respect of property deposited in the said safe is limited to ordinary care in the performance by employees and officers of company of their duties and shall consist only of (a) keeping the safe in vault where located when this rental contract is entered into or in one of equal specifications, the door to which safe shall be locked at all time except when an officer or an employee is present, (b) allowing no person access to said safe. except hirer or authorised deputy, or attorney in fact having special power to act identification by signature being sufficient or his/her legal representative in the case of death, insolvency or other disability of Hirer, except as herein expressly stipulated. An unauthorised opening shall be presumed or inferred from proof of partial or total loss of contents. The company shall not be liable for any delay caused by the failure of the vault doors or locks to operate. The company shall not be liable for any loss etc. The only purpose of the contract was to ensure the safety of the articles deposited in the safe deposit vault. It was implicit in the contract that the lockers supplied must necessarily be in a good condition to achieve that purpose and, therefore, that they should be in a reasonably perfect condition. It was an implied term of such a contract. Condition 15 imposed another obligation on the Bank to achieve the same purpose, namely, that the Bank should not allow access to any person to the safe except the hirer or his authorised agent or attorney. If the articles deposited were lost because one or other of these two conditions was broken by the Bank, the renter would certainly be entitled to recover damages for the said breach. Such a claim would be ex contractu and not ex delicto and for such a claim article 115 of the First Schedule to the Limitation Act applied and not article 36 thereof. Learned counsel for the appellant contended that the suits were not based upon the breach of a contract committed by the Bank but only the theft committed by its agent dehors the terms of the contract. This leads us to the consideration of the scope of the plaints presented by the respondents. It would be enough if we take one of the plaints as an example, for others also run on the same lines. Let us take the plaint in Civil Suit No. 141 of 1954, i.e., the suit flied by Sohanlal Sehgal and others against the Bank for the recovery of d sum of Rs. 26,500. We have carefully gone through 298 the plaint, particularly paragraphs 8, 9 and 10 thereof. It will be seen from the plaint that though it was not artistically drafted the relief was claimed mainly on two grounds, namely, (i) that it was an implied term of the contract that the locker rented was in a good condition, and (ii) the valuables were lost because the Manager, on account of the negligence of the Bank in not taking all the necessary precautions, committed theft of the articles in the course of his employment. In the written statement the defendant denied its liability both under the terms of the contract and also on the basis that it was not liable for the agent 's fraud. The High Court found that at the time when the lockers were rented out they were in a defective condition and that the Bank, in actual practice, made the Manager the sole custodian with full control over the keys of the strong,room and permitted a great deal of laxity in not having any check whatsoever on him. In this state of the pleadings and the findings it is not possible to accept the contention of the learned counsel ' for the appellant that the plaintiffs did not base their claims on the branch of the conditions of the contracts. This argument is in the teeth of the allegations made in the plaint, evidence adduced and the arguments advanced in the Courts below and the findings arrived at by them. While we concede that the plaint could have been better drafted and couched in a clearer language, we cannot accede to the contention that the plaints were solely based upon the fraud of the Manager in the course of his employment. We, therefore. hold that there were clear allegations in the plaints that the defen dant committed breach of the contracts in not complying with some of the conditions thereof and that the defendant understood those allegations in that light and traversed them. The suit claims, being ex contractu were clearly governed by article 115 of the First Schedule to the Limitation Act and not by article 36 thereof. If article 115 applied, it is not disputed that the suits were within time. Even if the claim was solely based on the fraud committed by the Manager during the course of his employment. we do not see how such a claim fell under article 36 of the First Schedule to the Limitation Act. To attract article 36. the misfeasance shall be independent of contract. The fraud of the Manager committed in the course of his employment is deemed to be a fraud of the principal, that is to say the Bank must be deemed to have permitted its manager to commit theft in violation of the terms of the contracts. While under the contracts the Bank was under an obligation to give to the respondents good lockers ensuring safety and protection against theft, it .gave defective ones facilitating theft; while under the contracts it should not permit access to the safe to persons other than those mentioned in the contracts. in violation of the terms thereof it gave access to its Manager and enabled him to commit theft. In either case the wrong committed was not independent of the contract. but it directly arose out of the breach of the contract. 299 1n such circumstances article 36 is out of place. The competition between articles 115 and 120 to take its place need not be considered. for neither of those Articles hits the claim, as the suits are within 3 years. which is the shorter of the two periods of limitation prescribed under the said two Articles. In this view it is not necessary to express our view on the question whether the contracts in question were of bailment. In the result, the appeals fail and are dismissed with costs one hearing fee. Appeals dismissed.

The respondents hired lockers in the safe deposit vaults from the appellant bank at Jullundur through its manager under different agreements on various dates during 1950. In April 1951, the lockers were tampered with and the valuables of the respondents kept in them were removed by the Manager. In due course the Manager was prosecuted and convicted for theft. The respondents filed three suits against the bank for the recovery of different sums being the value of the contents of the lockers which had been removed. The bank denied its liability on various grounds and also contended that the suits were, barred by limitation. The trial court held that the Bank was liable to bear the loss incurred by the respondents and that the suits were not barred by limitation. On appeal, the High Court accepted the findings of the trial court on both the questions and dismissed the appeals. In the appeal before the Supreme Court, only the question of limitation was raised. It was contended of behalf of the appellants on the facts found that the suit was barred by limitation as the theft of the valuables by the Manager was a tort committed by him dehors the contracts entered into by the appellant with the respondents and, therefore, Article 36 of the Limitation Act which required that a suit must be instituted within two years applied, and not article 115, which provided for a period of limitation of three years; that the suits were, not based on a breach of contract committed by the bank but only the theft committed by its agent dehors the terms of the contract. HELD: The suit claims, being ex contractu, were clearly governed by Article 115 of the First Schedule to the Limitation Act and by Article 36. [298F] There were clear allegations in the plaint that the appellant committed breach of contract in not complying with some of the contitions thereof and that the appellant understood those allegations in that light and traversed them. [298 E] Even ii the respondents ' claim was solely based on the fraud committed by the manager during the course of his employment, such a claim could not fall under article 36. To attract article 36, the misfeasance must be independent of contract. The fraud of the manager committed in the course of his employment must be deemed to be a fraud of the principal, i.e. the Bank must be deemed to have permitted manager to commit theft in violation of the terms of the contracts. While under the contracts the bank was under an obligation to provide good lockers and not to permit access to the safe except to persons mentioned in the contracts, in violation of these terms the bank gave defective lockers and gave access to the manager, thus facilitating the theft. In either case the wrong committed was not independent of the contract but directly arose out of the breach of contract. [298 G, H]

Appeals Nos. 29 to 33, 89 and 90 of 1949. Appeals from the Judgment and Decree dated the 30th October 1945 of the High Court of Judicature at Madras (Lionel Leach C.J. and Rajamannar J.) in Appeals Nos. 230, 300 302, 355, 356 and 413 of 1943. G.S. Pathak (T. section Santhanam, with him) for the appellant in Civil Appeals Nos. 28 and 29 of 1949, respondent No. 1 in Civil Appeals Nos. 30, 32 and 33 of 1949 and respondent No. 2 in Civil Appeal No. 31 of 1949, for respondent No. 3 in Civil Appeal No. 31 of 1949 and for respondents Nos. 1 and 2 in Civil Appeals Nos. 89 and 90 of 1949. V.V. Raghavan, for the appellant in Civil Appeals Nos. 31 to 33 of 1949, respondent No. 1 in Civil Appeals Nos. 28 and 29 of 1949 and respondent No. 2 in Civil Appeal No. 30 of 1949.B. Somayya (K. Subramaniam and Alladi Kuppuswami, with him) for the appellant in Civil Appeals Nos. 30, 89 and 90 of 1949, respondent No. 1 in Civil Appeal No. 31 of 1949 and respondent No. 2 in Civil Appeals Nos. 28, 29, 32 and 33 of 1949. December 14. The Judgment of the Court was delivered by MAHAJAN J. 244 MAHAJAN J. These eight appeals arise out of a common judgment of the High Court of Madras dated the 30th October, 1945, given in seven appeals preferred to it against the judgment of the District Judge of Madura in four suits, O.S. Nos. 2, 5, 6 and 7 of 1941, all of which related to the zamindari of Bodinaickanur "in the Madura district and the properties connected therewith. The appeals were originally before the Privy Council in England, some by leave of the High Court and others by special leave and are now before us for disposal. The zamindari of Bodinaickanur is an ancient impartible estate in the district of Madura, owned by a Hindu joint family. The genealogical tree of the family is as follows : 245 Thirumalai Bodi Naicker Faisal Zamindar : : Rajaya Naicker(Died) : : (1) Bangaru Thirumali Bodi Naicker Zamindar 1849 1862(Died) : : : : : : T. B. Kamaraja Pandia Naicker Vadamalai Raja Zamindar1962 1888(Died15 12 1888) Pandia Naicker (Widow) Kamuluammal Zamindarini (Died in 1901) 1888 1921(Died 13 1 1921) : : Meenakshi Ammal (Died) : : : : : : : Peria Thayi Chainnathayi alias Satpur alias Muthumeenakshi Veeralakshmi Ammal Zamindar Veerakamulu Ammal (2nd Deft.) T.V.K. (3rd defendant) Kamaraja pandia Naicker, late Zamindar (2) Viswanatha Naicker (Died before 1888) : : Kandasami Naicker plff in O.S. 16 of 1889(Died 20 2 1901) : : : : : : Viswanatha Kamaraja Pandia T.V.K. Kamaraja (No.II) Naicker (Died on 29 7 1918) Pandiaya Naicker (Died 16 2 1941) Zamindar 1921 1941 Widow Chinnathayi alias Veeralakshmi Ammal (2nd Deft.) (3) Sundara Pandia Naicker (Died in 1893) : : : : : : : : : : : : Viswanathaswami Thirumalai Seelaraja Seela Kamaraja Naicker Muthu Vijaya Naicker Bodi pandia (died) Dalapathi Died on Naicker Naicker Pandia 25 9 1931) Naicker (Died) : : : : : : : T.B.S.S. Rajaya Pandiya Chokkalingaswami Naicker (Plaintiff) Naicker (4) Kulasekara pandia Naicker(No.1) (Died after 10 5 1889 but before 1902) : : : : : : Kulasekara pandiya Muthu Bangaruswami Naicker (No. 2) Naicker (Died) (Died before 1902) : : : : V.Kulasekara pandiya Naicker (1st Deft.) : : : : Vadamalai Muthu Thirumalai Bodaya Kulasekara Sundararaja Pandiya Naicker Pandiya Naicker (5) Chokkalingasami Naicker (Died after 10 5 1889 but before 1902) : : : : : : : : : Tirumalai Bodaya Chhokkalingasami T.B. Kamaraja Sundararau Pandiya Naicker (Died) Pandiya Naicker Naicker (Died) : : : : : : T.B.M.S.K. Pandiya Pandiya Raja Naicker Naicker 246 The zamindari was last held by Kamaraja II of the second branch. He died on 16th February, 1941, without male issue, but leaving him surviving a widow Chinnathayi alias Veeralakshmi Ammal, and members of the family belonging to the third, fourth and fifth branches. Succession to the zamindari is admittedly governed by the rule of lineal primogeniture modified by a family custom according to which the younger son by the senior wife is preferred to an eider son by junior wife. According to this custom T.B.S.S. Rajaya Pandiya Naicker of the third,branch was entitled to the zamindari after the death of Kamaraja II of the second branch. His claim was denied by the widow and by Kulasekara Pandiya Naicker of the fourth branch, both of whom claimed the zamindari on different grounds. It was alleged by the widow that the zamindari was the separate and exclusive property of her husband and that being so, she was entitled to it under the rule of Mitakshara applicable to devolu tion of separate property. Kulasekara of the fourth branch claimed it on the basis that Sundata Pandiya Naicker of the third branch who died in 1893, had separated from the family and had renounced his and his descendants ' rights of succession to the zamindari and the third 'branch having thus lost all interest in the joint family zamindari, he was the next person entitled to it by survivorship. On 28th April, 1941, the revenue officer allowed the claim of Kulasekara and held that he was entitled to posses sion of the zamindari and the pannai lands (home farm lands) which were in the possession of Kamaraja II. As regards one of the villages comprised in the zamindari, viz., Boothipu ram, the title of the widow was recognized. In pursuance of this order, Kulasekara got into ,possession of the zamindari and the pannai lands after the death of Kamaraja II. Boot hipuram village remained in the possession of the widow. Dissatisfied with the order of the revenue officer, the parties have instituted the suits out of which these appeals arise. 247 On the 22nd June, 1941, the widow (Chinnathayi) brought suit No. 5 of 1941 for possession of the zamindari against Kulasekara of the fourth branch, Rajaya and his uncle Seela bodi Naicker of the third branch, T.B.M.S.K. Pandiya Naicker and Kamaraja Pandiya Naicker of the fifth branch, on the allegations set out, above. On the 4th July, 1941, she and her sister instituted suit No. 2 of 1941 against the same set of defendants for cancellation of the deed of release that had been executed by her and her sister in favour of Kamaraja II on the 9th June, 1934, in respect of the pannai lands that were in the possession of Kulasekara of the fourth branch under the order of the revenue officer. The third suit, O.S. No. 6 of 1941, was brought by Rajaya of the third branch on 27th August, 1941, for posses sion of the zamindari, Boothipuram village and the pannai lands, against Kulasekara of the fourth branch and the two plaintiffs in suit No. 2 of 1941, on the allegation that under the rule of lineal promogeniture he was the person next entitled to succeed to the zamindari after the death of Kamaraja II. The last suit, O.S. No. 7 of 1941, was instituted by Kulasekara of the fourth branch on 13th October, 1941, against the widow and Rajaya, his rival claimants to the zamindari for a declaration that he was the rightful heir and successor to the zamindari and was entitled to posses sion of Boothipuram village registered in the name of the widow. The zamindari of Bodinaickanur orginally consisted of fifteen villages mentioned in schedule (A) to the plaint in O.S. No. 6 of 1941 and of certain pannai (home farm)lands and buildings. Tirumalai Bodi Naicker was the holder of this impartible raj. He was succeeded by his son Rajaya Naicker who died in 1849, leaving him surviving five sons, Bangaru Tirumalai Bodi Naicker, Viswanatha Naicker, Sundara Pandiya. Naicker, Kulasekara Pandiya Naicker and Chokkalin gaswami Naicker, representing the first, second, third, fourth and fifth branches respectively. Rajaya 248 Naicker was succeeded by his eldest 'son Bangaru Thirumalai Bodi Naicker who died on the 27th October, 1862, and was succeeded by his son. T.B. Kamaraja Pandiya Naicker (Kamara ja I) who remained as zamindar till his death on 15th Decem ber. He had no son and on his death his widow Kamulu ammal got into possession of the estate. Proceedings for transfer were taken in the revenue court for registry of the zamindari and statements of the male members of the family belonging to the second, third, fourth and fifth branches and of the widow were recorded by the Deputy Collector. On 18th December, 1888, the representatives of these branches stated that they had no objection to Kamuluammal enjoying the zamindari. On the 19th Kamuluammal asserted that her husband by his will had bequeathed the zamindari to her and had given her permission to make an adoption. On the same date the representatives of all branches of the family made a joint statement before the Deputy Collector. The relevant portion of it is in these terms : "We four persons are his heirs to succeed and yet we agree to his widow Kamuluammal taking and enjoying the above said zamin and all other properties save the undermentioned lands set apart for our maintenance. Remission of the tirwah of the said lands allowed to us and of the tirwah of the lands registered in our names and enjoyed till now, should be granted to us. " 544 kulies of pannai lands under the Bangaruswami tank and the Marimoor tank were earmarked for the maintenance of the four branches. The widow made a statement on 20th ac cepting this arrangement. The Deputy Collector submitted his report on the 5th of January, 1889, to the Collector upholding the will. The Collector in his turn also recorded the statements of the representatives of the several branch es of the family. Persons representing the third, fourth and fifth branches adhered to the previous statements made by them but Kandasami of the second branch resiled from his earlier statement and asserted that the 249 family being divided he was the next heir to the zamindari. No notice was taken in these proceedings of Vadamalai, the half brother of Kamaraja I Sundara Pandiya 's statement before the Collector on the 9th January, 1889, was in these terms : "The wish of the family is that the widow should be in charge of the estate. I know nothing about the execution of the will. After the death of the widow, the next heir should succeed. He is Kandaswami, son of Viswanathaswami Naicker, my eldest brother, deceased. ' ' To the same effect were the statements of Kulasekara of the fourth branch and of Chokkalingaswami of the fifth branch. Kandaswami 's statement was recorded on the 14th January, 1889, and he said as follows : "I am the next heir to the zamin, the family being undivided. I must get it." He repudiated his earlier statement on the ground that at that time he was ill and was drowned in sorrow and "some rogue imitated his signature" and put it on his previous statement. The revenue Officer ordered that the widow 's name be registered as the next person entitled to the zamindari subject to any order that the civil court might make in the case. On the 1st May, 1889, Kandasami filed O. S No. 16 of 1889 in the court of the Subordinate Judge of Madura im pleading the widow and the Collector as defendants for recovery of the entire zamindari as it then existed, includ ing the villages of Boothipuram and Dombacheri and the pannai lands. He alleged that he as a member of the undivided Hindu family was entitled to succeed to the zamindari by survivor ship and in accordance with the established rule applicable to the devolution of this zamindari. Kamuluammal denied this claim and asserted that the zamindari was the separate property of her husband and she was entitled to it in pref erence to her husband 's collaterals. She also based her claim on the alleged will of her husband. Sundara Pandiya of the third branch laid a claim to the zamindari and the 33 250 pannai lands on the ground that he as senior in age amongst the family members was entitled to them in preference to Rajaya on the rule of simple primogeniture. In view of the pending and threatened litigation the contesting parties thought it fit to end their disputes by a mutual settlement beneficial to all of them. Sundara Pandiya was the first to strike a bargain with the widow. On the 6th May, 1890, a deed of release (Exhibit P 17) was executed by him in favour of Kamuluammal incorporating the terms of the agreement. He managed to get from her in consideration of the release the village of Dombacheri absolutely for himself and his heirs. She bound herself to pay the peishkush and road cess of the said village without any concern about that on the part of Sundara Pandiya. He was also allowed to enjoy free of rent from generation to generation with power of alienation by way of gift, sale, etc. the one fourth share in the pannai lands under the irrigation of the Bangaruswami tank and the Marimoor tank and mentioned in the joint state ment made by the several branches of the family before the Deputy Collector in December 1888. Over and above this, he received a cash payment of Rs. 3,000. With the exception of Dombacheri village and of the one fourth share in the said pannai lands, all the other properties which belonged to Kamaraja I were to be held and enjoyed with all rights by Kamuluammal and her heirs with the power of alienation thereof by way of gift, sale etc. absolutely. The fourth clause of the release is in these terms : "Whatever rights over the said zamin properties and in all the other above mentioned properties, the said Sundara Pandiya Naicker Avargal might possess, he gives up such rights absolutely in favour of the said Kamuluammal Avargal and her heirs enabling them to enjoy them with the power of alienation thereof by way of gift, sale, etc. and whatever rights the said Kamuluammal might possess over the Dombach eri village and over the lands lying under the irrigation of the Bangarusami tank and the Marimoor tank and specified in the third column of the schedule hereto, 251 which are given up to the aforesaid Sundarn Pandiya Naicker Avargal, the said Kamuluammal Avargal hereby gives up such rights absolutely in favour of the said Pandiya Naicker Avargal and his heirs, enabling them to enjoy them with the power of alienation thereof by way of gift, sale etc. " Clause 5 runs thus : "The said Kamuluammal and her heirs shall have no claim at all to the properties shown as belonging to Sundara Pandiya Naicker Avargal as aforesaid and the said Sundarn Pandiya Naicker Avargal and his heirs shall have no claim at all to the properties shown as belonging to the said Kamu luammal Avargal. " This deed was presented for registration on 10th May, 1890. On the same day O.S. No. 16 of 1889, i.e., Kandasami 's suit, was also compromised Exhibit P 18 contains the terms of that compromise. The following are its important provi sions : (a) The zamindari shall be enjoyed by Kamuluammal till her lifetime and she shall have no right to mortgage those properties in any way prejudicial to the plaintiff. (b) Kandasami and his heirs shall after the lifetime of Kamuluammal, enjoy the zamindari excepting Dombacheri vil lage together with such rights if any as the first defendant Kamuluammal may have acquired under the deed of release executed between her and Sundarn Pandiya. (c) Boothipuram village shall be given to the plaintiff by Kamuluarnmal so that she may enjoy it with absolute rights. The entire peishkush and the road cess for the entire zamindari inclusive of the said village shall be paid by Kamuluammal. (d) The one fourth share in pannai lands situated on the irrigation areas of Bangaruswami tank and Marimoor tank shall be enjoyed by Kandaswami and his heirs with powers of alienation and with absolute rights. (e) Rs. a5,000 shall be paid to Kandasami by Kamuluam mal. 252 (f) All the other pannai lands, buildings and movables which belonged to the deceased Kamaraja Pandiya Naicker shall be held and enjoyed by Kamuluammal and her heirs with powers of alienation etc. and with absolute rights free from any future claim on the part of Kandaswami and his heirs. (g) The movable and immovable properties which may be acquired by Kamuluammal from out of the income of the za mindari shall belong to her with power of alienation etc. and shall go to her own heirs after her lifetime. (h) Kamuluammal shall not make an adoption. By the proceedings taken before the Collector and by the arrange ment made under Exhibits P 17 and P 18, the disputes that had then arisen in the family were settled. Kamuluammal, however, did not with good grace part with the properties which she had agreed to give to others under the arrange ment. The terms of the compromise had to be enforced against her by a number of suits and actions one by one. Be that as it may, it is not denied now that the arrangement arrived at was eventually acted upon. Kandasami and his sons enjoyed the Boothipuram village and one fourth of the pannai lands in the two tanks absolutely. Sundara Pandiya and his descendants enjoyed Dombacheri and one fourth pan nailands, the fourth and fifth branches obtained possession of one fourth share of the pannai lands under the two tanks. Kamuluammal secured revenue registration and remained in possession of the property down to the date of her death on lath January, 1921. On her death the estate became vested in the possession of Kamaraja II, the sole male representative of the second branch, his father Kandasami and his brother Viswanathaswami having predeceased Kamuluam mal. He had been married to Chinnathayi (Veeralakshmi) one of the grand daughters of Kamuluammal during her lifetime. In the year 1925, the zamindar of Saptur, the son of Kamulu 's deceased daughter Meenakshi, instituted 253 O.S. No. 7 of 1925 against his sisters, Chinnathayi and Periathayi, and Kamaraja II, for recovery of the pannai lands and buildings which had vested absolutely in Kamulu under the compromise decree, on the allegation that these were held by her as a widow 's estate and that he as the daughter 's son was entitled to succeed to them. The suit was resisted by the two sisters on the plea that these lands were stridhanam properties of Kamulu and they as stridhanam heirs were entitled to them in preference to their brother. Kamaraja II contended that he was entitled to these lands and buildings as they formed an integral part of the zamind ari and were treated as such by Kamulu. This suit was dis missed and the plea of the two sisters was upheld. On 9th June, 1934, both of them executed a deed of release in favour of Kamaraja II whereby they conceded his claim to the pannai lands and the buildings as being appurtenant to the zamindari in consideration of his agreeing to pay Rs. 300 per mensem for life to each of them. On the death of Kamaraja II on the 16th February, 1941, as already stated, the second branch of the family became extinct, and disputes arose in regard to the succession to the zamindari, pannai lands, buildings etc. and the village of Boothipuram. As above stated, the claimants to the za mindari are three in number, Rajaya of the third branch, Kulasekara of the fourth branch, and Chinnathayi alias Veeralakshmi, the widow of the late zamindar. The District Court and on appeal the High Court have concurrently held that Rajaya was the person entitled to the zamindari. The District Court further held that the village of Boothipuram continued to be part of the zamin and decreed the same to the plaintiff Rajaya. As regards the pannai lands, it was held that these had been conveyed absolutely to Kamulu under Exhibit P 18 and that her daughter 's daughters, Periathayi and Chinnathayi. succeeded to the same as her stridhanam heirs and that the release deed executed by them on the 9th June, 1934, was invalid and inoperative to convey a valid title to Kamaraja 11. On appeal the High Court 254 confirmed the findings of the District Court as regards the pannai lands and buildings but reversed its findings as regards succession to Boothipuram. It held that Kandasami obtained Boothipuram village as his selfacquired property and that Chinnathayi was entitled to succeed to the same on the demise of her husband Kamaraja II. The various sets of parties have preferred the above appeals against the deci sion of the High Court to the extent it goes against them. The points for determination in these appeals are the following : 1. Who out of the three claimants is entitled to the zamindari. Whether Boothipuram village is still an integral part of the zamindari or did it become the self acquired property of Kandasami by the compromise, Exhibit P 18. 3. Whether the pannai lands and buildings are part of the zamindari or became the stridhanam of Kamuluammal by the compromise decree and did not merge in the zamindari by the release deed of 1934. The question relating to the pannai lands and buildings can be shortly disposed of. Both the courts below have held that under the arrangement arrived at amongst the members of this family in the year 1890 these lands became the stridha nam of Kamuluammal and passed on to her stridhanam heirs, i.e., her granddaughters Chinnathayi and Periathayi, and that the deed of release executed by the two sisters in favour of Kamaraja II was vitiated by fraud and was not binding on Chinnathayi and the other heirs. This finding could not be seriously disputed by Mr. Somayya appearing for Rajaya or by Mr. Raghavan appearing for Kulasekara. It was faintly argued that the pannai lands were left with the widow in the same status in which she was allowed to retain the zamindari. This contention is contrary to the clear recitals of the compromise deed. Kamuluammal was a forceful personality and it seems clear that she agreed to accept the title of Kandasami as next entitled to the 255 estate and to give up her contention based on the will because she was given the zamindari for her lifetime and these pannai lands and buildings absolutely. Kandasami in whom the inheritance had vested was competent, in view of the decision in Sartaj Kuari 's case(1), to alienate these lands in her favour and to vest her with absolute interest in them. It has therefore been rightly held that Kamulu became the absolute owner of the lands which in due course devolved on her grand daughters and ceased to be part of the joint family estate. Moreover, it does not lie in the mouth of Sundarn Pandiya 's descendants to challenge Kamuluammal 's absolute title to these lands while retaining absolute title in the village of Dombacheri which under the same arrange ment Sundarn Pandiya got absolutely with rights of aliena tion. It was conceded that to the family arrangement ar rived at in the year 1890 and evidenced by the statements made before the Collector, the recitals contained in the release deed, Exhibit P 17, and those made in the compromise deed, Exhibit P 18, all the members of the family were either parties or they accepted it and acted upon it. The result is that the widow Chinnathayi is entitled to the possession of those lands and no other person has any right to them whatever. As regards Boothipuram village, the point is a simple one. Under the compromise, Exhibit P 18, this village was left with Kandasami, the person next entitled to the zamind ari after the death of Kamaraja I. It was separated from the zamindari estate which remained m possession and enjoyment of Kamuluammal for her lifetime. It was said in the compro mise that Kandasami would be the absolute owner of this village. It was argued by Mr. Somayya, and the same was the view taken by the trial Judge, that Kandasami being the holder of an impartible estate could not by his own unilat eral act enlarge his estate and take a part of this estate in a different right than the right of a holder of an im partible zamindari and that he could not make it separate property by his own act. (1) (1888) 15 I.A. 51. 256 The High Court did not accept this view but reached the decision that all the branches of the family agreed to Kandasami having this village as his private property and that by common consent it was taken out of the zamindari and given to him absolutely and it was thus impressed with the character of separate property. On Kandasami 's death it devolved on his son by succession and not by survivorship and Chinnathayi has a widow 's estate in it after the death of her husband. In the High Court it was conceded that all the members of the family were aware of the terms of the family arrangement and were bound by them. In view of this concession it seems to us that it is not open to any of the parties to these appeals to deny at this stage the right of the widow to this village as an heir to her husband 's es tate. The main fight in all these appeals centres round the title and heirship to the zamindari. The question four determination is, whether the zamindari by some process became the separate property of Kandasami and that of his son Kamaraja II. If it became the separate property of Kamaraja II, then Chinnathayi, his widow, would succeed to it on his death; on the other hand, if the zamindari re tained its character of joint family property in the hands of Kamaraja II, then the question to decide is whether as a result of the arrangement made in 1890 Sundarn Pandiya relinquished his right to succeed to the family zamindari on the failure of nearest male heirs of Kandasami. If such relinquishment on his part is held satisfactorily estab lished, then Kulasekara of the fourth branch would be enti tled to succeed to the zamindari; otherwise Rajaya of Sun darn Pandiya 's branch alone is entitled to it under the rule of succession applicable to the devolution of the zamindari. The claim made by the widow that the zamindari became by the arrangement of 1890 the separate property of Kandasami was disallowed by the High Court on the short ground that the documents, Exhibits P 17 and P 18, read along with the various statements made in 1889 cannot be read as changing the character 257 of the estate from that of an impartible estate belonging to the joint family to an estate owned by Kandasami in his individual right. In the view of the High Court the only change effected by the arrangement so far as the estate was concerned was to defer the right of Kandasami to its posses sion as the next in succession until after the death of Kamuluammal. Kandasami could not himself make it his own private property and this was conceded by all. After hear ing Mr. Pathak at considerable length we are in agreement with the High Court on this point. Mr. Pathak argued that on the true construction of Exhibits P 17 and P 18 and on the evidence furnished by these two documents and the statements made antecedent to their execution and also in view of the subsequent conduct of the parties, the correct inference to draw was that all the five branches of the family separated in the year 1890 and thus put an end to the joint family character of the zamindari that Kandasami was allotted the zamindary, Boot hipuram village and one fourth pannai lands under the two tanks, Sundara Pandiya was allotted Dombacheri village and one fourth of the pannai lands and that the fourth and fifth branches in lieu of their share were assigned one fourth of the pannai lands irrigated by the two tanks mentioned above and by these allotments the joint family was completely disrupted and the properties allotted to the different branches became their separate properties. Reference was made to the decisions of the Privy Council in Vadreun Ranganayakamma vs Vadrevu Bulli Ramaiya (1); Sivagnana Tevar vs Periasami(2); Thakurani Tara Kumari vs Chaturbhuj Narayan Singh (3); and it was contended that the present case was analogous to the facts of those cases and should be decided on similar lines. We are of the opinion that the facts of none of those cases bear any close resem blance to the facts of the present case. The decision in (1) (3) (1915) 42 I.A. 192, (2) (1877) 5 I.A. 51. 34 258 each one of those cases was given on their own peculiar set of circumstances. In the first case the owner of an impartible zamindari forming part of family property died leaving four sons and an infant grandson by his eldest son. During the minority of the grandson the four surviving sons executed a sanad which directed that the zamindari should be held by the grandson and that they should take an equal share of the inam lands and also manage the zamindari during the infancy of the grandson, which on his attaining majority had to be handed over to him, each confining himself to the share of the inam lands allotted to them. Certain family jewellery was also divided in a similar manner. This grandson then died leaving a son, who also died without any issue but leaving a widow. Her title to the zamindari was denied by the descendants of the four sons of the zamindar. It was held that the sanad amounted to an agreement by which the joint family was divided and that on the death of the last holder his widow was entitled to the zamindari. It was observed in this case that having partitioned the lands, the parties to the sanad proceeded to partition the jewels and this circumstance was inconsistent with the supposition that the document was executed with the intention of merely providing allotments in lieu of maintenance. It is clear from the facts of this case that the family owned other coparcenary properties besides the zamindari and the zamind ari in dispute fell to the lot of the grandson as his sepa rate property. There were other materials in the case indicating that there was complete separation between the members of this family. In the next case an impartible zamindari had devolved on the eldest of three undivided Hindu brothers. He exe cuted an instrument appointing his second brother to be zamindar. The instrument recited that if the widow of the deceased who was pregnant did not give birth to a son but a daughter, he and his offspring would have no interest in the zamindari of 259 which his younger brother would be the sole zamindar who would also allow maintenance to the third brother. The widow gave birth to a daughter and the second brother took over the zamindari. The third brother also died without issue. On the death of the second brother his son succeeded and the zamindari devolved on him who died leaving a widow. The son of the eldest brother who had renounced the zamind ari sued to recover the estate against the widow. It was held that the instrument executed by the eldest brother was a renunciation by him for himself and his descendants of all interests in the zamindari either as the head or as a junior member of the joint family and consequently it became the separate property of the second brother and the widow was entitled to succeed to it in preference to the line of the eldest brother. The document on the interpretation of which this decision was given was in these terms : "I and my offspring shall have no interest in the said palayapat, but you alone shall be the zamindar and rule and enjoy the same, allowing, at the same time, as per former agreement to the younger brother, P. Bodhagurusami Tevar, who in the pedigree is called Chinnasami, the village that had been assigned to him before. " These words were interpreted as amounting to a renuncia tion of all interest in the palayapat either as the head of or as a junior member of the joint family. The rights of the youngest brother Chinnasami were expressly reserved. It was said that the effect of the transaction was to make the particular estate the property of the two instead of the three brothers, with, of course, all its incidents of im partibility and peculiar course of the descent, and to do so as effectually as if in the case of an ordinary partition between the eider brother on the one hand and the two young er brothers on the other, a particular property had fallen to the lot of the other two. Other clauses in the deed and the attending circumstances fully corroborated the construc tion placed upon it. 260 In the last case the holder of an impartible estate of a joint Hindu family made a mokurari grant to his younger brother for maintenance. The grantee built a separate house, divided from his brother 's by a wall, established therein a tulsi pinda and thakurbari, and lived there sepa rately from his brother. He derrayed the marriage expenses of his daughter subsequently to the grant. Upon these facts it was held that there was a complete separation between the brothers, and that the impartible estate consequently became separate property of the holder whose widow was entitled to succeed and have a widow 's estate in the zamindari. It was observed that the evidence clearly proved that there had been complete separation between Thakur Ranjit Narayan Singh and his brother Bhupat Narayan Singh in worship, food and estate. In our opinion, the decision in this case must be limited to the facts therein disclosed and can have no general application to cases of impartible estates where the only right left to the junior members of the family is the right to take the estate by survivorship in case of failure of lineal heirs in the line of the last zamindari. The junior members can neither demand partition of the estate nor can they claim maintenance as of right except on the strength of custom, nor are they entitled to possession or enjoyment of the estate. In our opinion, division amongst the members of this family by allotment of properties was not possible as the only property known to belong to the family was the imparti ble zamindari of which partition could not be made or de manded. To establish that an impartible estate has ceased to be joint family property for purposes of succession it is necessary to prove an intention, express or implied, on the part of the junior members of the family to give up their chance of succeeding to the estate. In each case, it is incumbent on the plaintiff to adduce satisfactory grounds for holding that the joint ownership of the defendant 's branch in the estate was determined so that it became the separate property of the last holder 's branch. The test to be applied is whether the 261 facts show a clear intention to renounce or surrender any interest in the impartible estate or a relinquishment of the right of succession and an intention to impress upon the zamindari the character of separate property. Reference in this connection may be made to the decision of the Privy Council in Konammal vs Annadana (1). In that case on the death of a holder, his eider son being feeble in mind, his younger son succeeded to the zamindari by an arrangement with the adult members of the family in the year 1922. The estate then descended from father to son till 1914 when the junior branch became ex tinct and possession was taken by a senior member of the branch who claimed it by survivorship; while the mother of the last holder claimed the estate as an heir to separate property, and it was held that the setting aside of the eider son in 1822 did not deprive his descendants of their rights as members of the family to succeed on failure of the junior branch. In this case there was complete passing over of one branch of the family to succession vested in the next junior branch; yet when that branch failed, the mem bers of the senior branch were held yet to possess their right to succeed to the zamindari by survivorship. In Collector of Gorakhpur vs Ram Sundar Mal(1), the claim of a Hindu to succeed by survivorship to an ancestral impartible estate was in issue in the suit. The family admittedly had been joint. It appeared that the common ancestor of the deceased holder and of the claimant had lived 200 years before the suit, that for a long period there had been a complete separation in worship, food and social intercourse between the claimant 's branch of the family and that of the deceased holder, and that upon the death of the holder the claimant had not disputed that the widow of the deceased was entitled to succeed. It was held that there was not to be implied from the circumstances (1) (1928) 55 I.A. 114. (2) All. 468 (P.C.). 262 stated above a renunuciation of the right to succeed so as to terminate the joint status for the purposes of that right. In Sri Raja Lakshmi Devi Garu vs Sri Raja Surya Nara yana Dhatrazu Bahadur Garu (1), the last zamindar died without any issue in 1888, and when his widow was in posses sion, the suit was brought for possession by a male collat eral descended from a great grandfather common to him and to the last zamindar. The plaintiff claimed to establish his right as a member of an undivided family holding joint property against the widow who alleged that her husband had been the sole proprietor. In proof of this she relied on certain arrangements as having constituted partition, viz., that in 1816, two brothers, then heirs, agreed that the eider should hold possession, and that the younger should accept a village, appropriated to him for maintenance in satisfaction of his claim to inherit; again, that in 1866, the fourth zamindar compromised a suit brought against him by his sister for her inheritance, on payment of a stipend to her having already, in the claim of his brother, granted to him two villages of the estate; and by the compromise, this was made conditional on the sister 's claim being set tled; again, that in 1871, the fourth zamindar having died pending a suit brought against him to establish the fact of an adoption by him, an arrangement was made for the mainte nance of his daughter, and two widows, who survived him, the previous grant for maintenance of his brother holding good, the adoption being admitted, and the suit compromised. It was held that there was nothing in the arrangement which was inconsistent with the zamindari remaining part of the common family property and that the course of the inheritance had not been altered. The facts of this case were much stronger than those of the present one. The mere circumstance that by an arrangement a village out of the zamindari was given to one of the brothers was not inconsistent with the zamindari remaining part of the common family property. (1) (1897)I.L.R. 263 The document executed by the brother in the reported case was in these terms : "I or my heirs shall not at any time make any claims against you or your heirs in respect of property movable or immovable, or in respect of any transaction. As our father put you in possession of the Belgam zamindari, I or my heirs shall not make any claim against you or your heirs in respect of the said zamindari. " It was observed by their Lordships that they did not find any sufficient evidence in the arrangement made by these documents of an intention to take the estate out of the category of joint or common family property so as to make it decendible otherwise than according to the rules of law applicable to such property, that the arrangement was quite consistent with the continuance of that legal charac ter of the property, that the eider brother was to enjoy the possession of the family estate, and the younger brother accepted the appropriated village for maintenance in satis faction of such rights as he conceived he was entitled to and that it was nothing more in substance than an arrange ment for the mode of enjoyment of the family property which did not alter the course of descent. The evidence in the present case is trivial and incon clusive and from the documents above mentioned no intention can be deduced on the part of the junior members or on the part of any other member of the family of disrupting and dividing the family and renouncing their expectancy of succession. On the other hand, the statements made in 1880 and 1800 by the members of the family clearly indicate that none of them had any intention of giving up his rights of heirship to the zamindari. There was no change of this frame of mind at any later stage of the family arrangement. Sundara Pandiya on the 9th January, 1889, clearly stated that the wish of the family was that the widow should be in charge of the estate and after her the next heir should succeed and that it was Kandasami. Kandasami said that he was the next 264 heir, the family being undivided. In the compromise this statement was reiterated. Their intention was to preserve their rights to take the zamindari if the line of Kandasami became extinct. Mr. Pathak then put his ease from a different point of view. He urged that Kandasami had the power to alienate 'the zamindari or any part of it and by an act of alienation he could defeat the right of survivorship vesting in the other members to claim the zamindari on failure of his line. Similarly he said he could divide the impartible estate amongst the different members of the family and that is what he must be presumed to have done in the present 'case. The argument, though plausible, is fallacious. The right to bring about a partition of an impartible estate cannot be inferred from the power of alienation that the holder thereof may possess. In the case of an impartible estate the power to divide it amongst the members does not exist, though the power in the holder to alienate it is there and from the existence of one power the other cannot be deduced, as it is destructive of the very nature and character of the estate and makes it partible property capable of partition. It seems to us that Kandasami instead of intending to separate from the family was by his actions consolidating the family unity. By the family arrangement he no doubt successfully got himself declared as the next person enti tled to hold the joint family zamindari, but he evinced no intention of converting it into his own separate property: He preserved the estate for the family by saving it from the attack of the widow who wanted to take it under the will of her husband and antagonistically to the family. By the suit which he brought and which was eventually compromised he successfully avoided that attack on the family estate at the sacrifice of his right of enjoying it during the lifetime of the widow. He also by this arrangement safeguarded himself against the attack of Sundara Pandiya on his title as an heir. By his act the rule of descent of lineal primogeni ture prevailing in the family with regard to the zamindari was firmly 265 established. It would be unjust and uncharitable to conclude from the circumstances that the actions of Kandasami in 1890 were in any way hostile to the interests of the family. As he was throughout acting for the benefit of the family his actions were approved by all the members and they got a provision made for themselves for their maintenance in the arrangement. In the suit that he filed against Kamuluammal he in unambiguous terms alleged that he was claiming the zamindari as a member of the undivided Hindu family and it was in that status that he made the compromise with her and agreed to obtain possession of the estate after her death. After Kandasami 's death ' when the zamindari came by descent to Kamaraja II, he also followed in the footsteps of his ancestor. During the period of his stewardship of the estate he tried to implement it by recovering the pannai lands which under the compromise had gone out of the estate to Kamulu absolutely. He was successful in his efforts though as a result of the decision in the present case his labours in this direction have proved futile as the release deed has been held to be vitiated by fraud. For the reasons given above we hold that there exist no satisfactory grounds for holding that the arrangement made in 1890 evidences a partition amongst the members of the joint family or proves an intention on the part of the junior members of the family to renounce their expectancy of succession by survivorship on failure of male lineal de scendants in the second branch of the family. The question whether there was separation among the members of the family is primarily a question of fact and the courts below having held that it is not proved, there are no valid grounds for disturbing that finding. Chinnathayi 's claim therefore to the zamindari must be held to have been rightly disallowed. As regards the claim of Kulasekara to the zamindari, it has been disallowed in the two courts below on the ground that the deed of release, Exhibit P 17, 35 266 does not extinguish the right of survivorship of the third branch to take the estate on the second branch becoming extinct and that the document could not be read as evidenc ing an intention on the part of Sundara Pandiva to surrender the right of succession of his branch. It has been further held that the release was not executed in favour of the head of the family or in "favour of all the members of the family in order to be operative as a valid relinquishment. There can be no doubt that a member of a joint family owning an impartible estate can on behalf of himself and his heirs renounce his right of succession; but any such relinquish ment must operate for the benefit of all the members and the surrender must be in favour of all the branches of the family, or in favour of the head of the family as represent ing all its members. Here the deed was executed in favour of the widow of a deceased copgrcener who as such was a stranger to the coparcenary, the family being admittedly joint at the death of Kamaraja I. It was contended that in view of the attitude taken by the parties before the High Court that the deed of release and the compromise evidenced only one arrangement to which all the members were in reali ty parties it should be held that the surrender of his rights by Sundara Pandiya was made in favour of Kandasami, the head of the family, and it extinguished the rights of the third branch in the family zamindari. We think, howev er, that Kandasami in dealing with Sundara Pandiya was safeguarding his own right of succession against the attack personally directed against him and was successful in buying him off by agreeing to hand over to him a village. Both of them were claiming headship of the family on different grounds and both were asserting that the zamindari belonged to the joint family. In the compromise Kandasami was acting for his own benefit and was not making any bargain with Sundara Pandiya on behalf of the family. The family as such could not have been prejudiced in any way by the circum stance that succession went to one or the other. Be that as it may, we think the decision 267 of this case can be made to rest on a more solid foundation than furnished by the considerations set out above. The whole emphasis of Mr. Raghavan who represented Kulasekara was on the words of the deed contained in clause 5 set out above. Sundara Pandiya by this clause stipulated that he will have no right to the property shown as belonging to the widow. Sundara Pandiya was then agreeing that the widow should retain the zamindari absolutely, his mind being affected by the will. Later on by the compromise made in Kandasami 's suit what had been given absolutely to the widow was converted into a life estate with the excep tion of the pannai lands and Kandasami was acknowledged as the rightful heir. The recitals in the release deed there fore have to be read in the light of the terms and condi tions of the deed of compromise and the proper inference from these is that Sundara Pandiya relinquished his rights to succeed to the zamindari immediately as the seniormost member of the family but that he did not renounce his con tingent right of succeeding to it by survivorship if and when the occasion arose. It is well settled that general words of a release do not mean release of rights other than those then put up and have to be limited to the circum stances which were in the contemplation of the parties when it was executed: vide Directors etc. of L. & S.W. Ry. Co. vs Richard Doddridge Blackmore (1). In that case it was said that general words in a release are limited to those things which were specially in the contemplation of the parties when the release was executed. This rule is good law in India as in England. The same rule has been stated in Norton on Deeds at page 206 (2nd Ed.) thus : "The general words of a release are limited always to that thing or those things which were specially in con templation of the parties at the time when the release was given, though they were not mentioned in the recitals." (1) 268 In Hailsham 's Edition of Halsbury 's Laws of England, Vol. 7, at para 345 the rule has been stated in these terms : "General words of release will be construed with refer ence to the surrounding circumstances and as being con trolled by recitals and context so as to give effect to the object and purpose of the document. A release will not be construed as applying to facts of which the creditor had no knowledge at the time when it was given." In Chowdhry Chintaman Singh vs Mst. Nowlukho Kunwari(1), where the document was drafted in almost the same terms as Exhibit P 17, it was said that though the words of the petition of compromise were capable of being read as if the executants were giving up all rights whatever in the taluka of Gungore, yet in the opinion of their Lord ships the transaction amounted to no more than an agreement to waive the claim to a share in and to the consequent right to a partition of the taluka and there was no intention to change the character of the estate or the mode in which it was to descend. The parties in the year 1890 were not thinking of their future rights of survivorship at all. What Sundara Pandiya must be taken to have said by this release was "I am giving up my present rights as a senior member in favour of Kandasami whom I recognize as the right ful heir to the zamindari as a member of the joint Hindu family." Kandasami agreed to give him the village of Domb acheri in lieu of recognition of his title by him. It was not within the ken of the parties then as to what was to happen to the zamindari in case Kandasami 's line died out. For the reasons given we are of the opinion that by the release Sundara Pandiya did not renounce his rights or the rights of his branch to succeed to the zamindari by survi vorship in case the line of Kandasami became extinct. We hold therefore that (1) (1874) 2 I.A. 263. 269 Kulasekara 's claim was rightly negatived in the courts below and that of Rajaya was rightly decreed. In the result all these appeals fail and are dismissed with costs. Appeals dismissed. Agent for the appellant in Civil Appeals Nos. 28 & 29 of 1949, respondent No. 1 in Civil Appeals Nos. 30, 32 & 33 of 1949 and respondent No. 2 in Civil Appeal No. 31 of 1949 and for Respondent No. 3 m Civil Appeal No. 31 of 1949: M.S.K. Sastri. Agent for the appellant in Civil Appeals Nos. 31 to 33 of 1949, respondent No. 1 in Civil Appeals Nos. 28, 29 of 1949 and respondent No. 2 in Civil Appeal No. 30 of 1949: M.S.K. Aiyangar. Agent for the appellant in Civil Appeals Nos. 30, 89 and 90 of 1949, respondent No. 1 in Civil Appeal No. 31 of 1949 and respondent No. 2 in Civil Appeals Nos. 28, 29, 32 & 33 of 1949: section Subrahmanyam. Agent for the respondents Nos. 1 and 2 in Civil Appeals Nos. 89 and 90 of 1949: V.P.K. Nambiyar.

To establish that an impartible estate has ceased to be joint family property for purposes of succession it is necessary to prove an intention, express or implied, on the part of the junior members of the family to give up their chance of succeeding to the estate. In each case it is incumbent on the plaintiff to adduce satisfactory grounds for holding that the joint ownership of the defendant 's branch in the estate was determined so that it became the separate property of the last holder 's branch. The test to be applied is whether the facts show a clear intention to renounce or surrender any interest in the impartible estate or a relinquishment of the right of succession and an inten tion to impress upon the zamindari the character of separate property. The right to bring about a partition of an impartible estate cannot be inferred from the power of alienation that the holder thereof may possess. In the case of an imparti ble estate the power to divide it amongst the members does not exist, though the power in the holder to alienate it is there, and from the existence of the one power the other cannot be deduced, as it is destructive of the very nature and character of the estate and makes it partible property. A member of a joint family owning an impartible estate can on behalf of himself and his heirs renounce his right of succession but any such relinquishment must operate for the benefit of all the members and the surrender must be in favour of all the branches of the family as representing all its members. General words of release in a release deed do not mean release of rights other than those then put up, and have to be limited to the circumstances which were in the contempla tion of the parties when it was executed. 32 242 On the death of the holder of an impartible estate who represented the first branch his widow K got into possession claiming that the estate was the separate property of her husband and also under a will. Disputes arose between her and the members of the 2nd, 3rd and 4th branches of the family and these were settled amicably. S who was the senior member of the 3rd branch obtained village D and one fourth of certain pannai lands as absolute owner and exe cuted a release deed on 6th May, 1890, in these terms: "Whatever rights over the said zamin properties and in all other above mentioned properties S might possess he gives up such rights absolutely in favour of the said K and her heirs enabling them to enjoy them with the power of alienation thereof by gilt, sale, etc. . The said S and his heirs shall have no claim at all to the properties shown as belonging to K 'S who represented the 2nd branch and had instituted a suit against K compromised the suit on the 10th May, 1890, under a deed which provided inter alia: (i) that the zamindari shall be enjoyed by K till her lifetime and that KS and his heirs shall after the lifetime of K enjoy the zamindari except village D which was given to S; (ii) village B and one fourth of certain pannai lands shall be given to KS absolutely; (iii)all other pannai lands, build ings and movables which belonged to K 's husband shall be enjoyed by K and her heirs absolutely." On the death of K the estate became vested in Z, the son of KS. On the death of Z without issue the second branch became extinct and disputes arose with regard to the ownership of the pannai lands and buildings, village B, and the zamindari between the widow of Z (who was the grand daughter of K) and the senior members of the 3rd and 4th branches: Held (i) that as KS was competent to alienate the pannai lands and buildings in favour of K and vest her with absolute title, and S had also agreed to give them to her absolutely, K became the absolute owner of these lands and buildings and these ceased to be part of the joint estate and devolved on the grand daughters of K as her stridhana heirs. (ii) In view of the arrangement of 1890 it was not open to any of the parties to deny that the village B was separated from the zemindari and given to KS absolutely as his private property. The village consequently devolved on Z as separate property and on his death it devolved on his widow. (iii) The arrangement made in 1890 did not evidence a partition amongst the members of the joint family or prove an intention on the part of the junior members of the family to renounce their expectancy of succession by survivorship on failure of the male lineal descendants in the branch of KS. (iv) That the recitals in the release deed executed by S had to be read in the light of the compromise in the suit of KS, and the 243 proper inference from both the documents read together was that S renounced only his right to succeed to the zemindari immediately as the seniormost member of the family and that he did not renounce his right or the right of his branch to succeed to the zemindari by survivorship if and when occa sion arose; the senior member of the 3rd branch was there fore entitled to succeed to the zemindari in preference to the senior member of the 4th branch and the widow of Z. Vadrevu Ranganayakamma vs Vadrevu Bulli Ramaiya (5 C.L.R.439), Sivagnana Tear vs Periasami (5 I.A. 51) and Thakurani Tara Kumari vs Chaturbhuj Narayan Singh (42 I.A. 192)distinguished. Sartaj Kuari 's case (15 I.A. 51), Konammal vs Annadana (55 I.A. 114), Collector of Gorakhpur vs Ram Sunder Mal (I.L.R. 56 All. 468 P.C.), Sri Raja Lakshmi Devi Garu vs Sri Raja Surya Narayana (I.L.R. P.C.) and Directors etc. of L.& S.W. Ry. Co. vs Richard Doddridge referred to. The Judgment of the Madras High Court affirmed.

No. 179 of 1968. Petition under article 32 of the Constitution of India for a writ in the nature of Habeas corpus. R.L. Kohli, for the petitioners. Debabrata Mukherjee and P.K. Chakravarti, for the respondent. The Judgment of the Court was delivered by Ramaswami, J. In this case the petitioners have. obtained a rule calling upon the respondent, viz., The State of West Bengal 637 to show cause why a writ of habeas corpus should not be issued under article 32 of the Constitution directing their release from detention under orders passed under section 3(2) of the (Act IV of 1950), hereinafter called the 'Act '. Cause has been shown by Mr. Debabrata Mukherjee and other Counsel on behalf of the respondent to whom notice of the rule was ordered to be given. The case of the petitioners will be considered in the following three groups: (1) Petitioners nos. 2, 4, 5, 6, 16, 17, 20 and 26, (2) Petitioners nos. 1, 3, 7, 10, 12, 13, 19 and 22, (3) Petitioners nos. 8, 9 and 21. By the order of this Court dated October 18, 1968, the cases as regards petitioners nos. 11, 14, 15, 18, 23, 24, 25, 27 to 30 were dismissed as they were reported to have been released. As regards petitioner No. 5, Subhas Chandra Bose alias Kanta Bose, the order of detention was made on January 20, 1968 by the District Magistrate, Howrah and reads as follows: "No. 202/C Dated, Howrah, the 20th January, 1968 WHEREAS I am satisfied with respect to the person known as Shri Kanta Bose alias Subhas Chandra Bose son of Shri Sishir Kumar Bose of 26, Nilmoni Mallick Lane, P.S. and Distt Howrah, that with a view to preventing him from acting in any manner prejudicial to the maintenance of public order it is necessary so to do , therefore, in exercise of the powers conferred by Section 3(2) of the (Act IV of 1950), I make this order directing that the said Shri Kanta Bose alias Subhas Chandra Bose be detained. Given under my hand and seal of office. Sd/ D.C. Mookherjee District Magistrate Howrah. On the same date ' the following grounds of detention were communicated to the detenu: "You are being detained in pursuance of a detention order made under sub section (2) of section 3 of the ' (Act IV of 1950) on the following grounds: Sup C1/69 8 638 2. You have been acting in a manner prejudicial to the maintenance of public order by commission of offences of riotous conduct, criminal intimidation and assault as detailed below : (a) That on 3 11 65 at about 17/30 hrs. you assaulted Shri Ashutosh Dutta son of Shri Pyari Mohan Dutta of 55, M.C. Ghosh Lane, P.W. Howrah at the crossing of Panchanan Tala Road and M.C. Ghosh Lane, with knife causing bleeding injuries on his hand. (b) That on 8 10 66 at about 16.00 hrs. while Shri Mahesh Prosad Bhagal son of Balgobinda Bhagal of 16, Belilious Road, P.S. Howrah was playing in an open field, you along with your associates demanded money from him and on his refusal you hurled cracker on him causing grievous injury on his right leg (c) That on 8 6 67 at about 11.40 hrs. you accosted one Sushanta Kumar Ghosh son of Manmatha Ghosh of 2/1/1, Danesh Sk. Lane inside a saloon at 255, Panchanantala Road on previous grudge and being intervened by Shri Shyamal Biswas son of Sandhya Biswas of 255, panchanantala Road, P.S. Howrah, you whipped out a dagger and assaulted Shri Biswas with the dagger causing injury on his hand. (d) That on 23 11 67 at about 22.45 hrs. you hurled cracker on A.S.I.B. Kundu of Bantra P.S. while he was coming to Howrah along panchanantala Road in a wireless van and caused injury to the A.S.I. and damage to the wireless van. (e) That on 7 1 68 at about 18.30 hrs. you threatened one Satya Narayan Prosad son of Late purusattam Prosad of 10, Debnath Banerjee Lane, P.S. Howtab with assault at the crossing of M.C. Ghosh Lane and Bellilious Road. You are hereby informed that you may make a representation to the State Government within 30 days of the receipt of the detention order and that such representation should be addressed to the Assistant Secretary to the Government of West Bengal, Home Department, Special Section, Writers ' Buildings, Calcutta and forwarded through the Superintendent of the Jail in which you are detained. You are also informed that under Section 10 of the (Act IV of 1950) the Advisory Board shall if you desire to be heard you in person and that if you desire to be so heard by the 639 Advisory Board you should intimate such desire in your representation to the State Government. Sd/ D.C. Mookerjee District Magistrate Howrah. " On March 19, 1968 the Advisory Board made a report under section 10 of the Act stating that there was sufficient cause for detention of Sri Kanta Bose alias Subhas Ch. On March 30, 1968 the Governor of West Bengal confirmed the detention order under section 11 (1) of the Act. Section 3 of the Act provides: "3. (1) The Central Government or the State Government may (a) If satisfied with respect to any person that with a view to preventing him from acting in any manner prejudicial to (i) the defence of India, the relation of India with foreign powers or the security of India, or (ii) the security of the State or the maintenance of public order, or (iii) the maintenance or supplies and a services essential to the community, or (b) if satisfied with respect to any person who is a foreigner within the meaning of the (XXXI of 1946), that with a view to regulating his continued presence in India or with a view to making arrangements for his expulsion from India, it is necessary so to do, make an order directing that such persons be detained. (2) Any of the following officers, namely, (a) District Magistrates, (b) Additional District Magistrates specially empowered in this behalf by the State Government, (c) the Commissioner of Police for Bombay, Calcutta, Madras or Hyderabad, (d) Collector in the State of Hyderabad, may satisfied as provided in sub clauses (2) and (3) of clause (a) of sub section (1 ) exercise powers conferred by the said sub section. 640 (3) When any order is made under this section by an officer mentioned in sub section (2) he shall forthwith report the fact to the State Government to which he is subordinate together with grounds on which the order has been made and such other particulars as in his opinion have a bearing on the matter, and no such order made 'after the commencement of the Preventive Detention (Second Amendment) Act, 1952, shall remain in force for more than twelve days after the making thereof unless in the meantime it has 'been approved by State Government. (4) When any order is made or approved by the State Government under this section, the State Government shall, as soon as may be, report the fact to the Central Government together with the grounds on which the order has been made and such other particulars as in the opinion of the State Government have bearing on the necessity for the order. " Section 7 is to the following effect: "7. '(1) When a person is detained in pursuance of a detention order, the authority making the order shall, as soon as may be, but not later than five days from the date of detention, communicate to him the grounds on which order has been made, and shall afford him the earliest opportunity if making a representation against the order to the appropriate Government. (2) Nothing in sub section (1) shall require the authority to disclose facts which it considers to be against the public interest to disclose. " It will be noticed that before an order of detention can be validly made by the detaining authorities specified by section 3(2) of the Act, the authority must be satisfied that the detention of the person is necessary in order to prevent him from acting in any prejudicial manner as indicated in cls. (i) to (iii) of section 3(1) (a). It is well settled that the satisfaction of the detaining authority to which section 3(1 )(a) refers is a subjective satisfaction, and so is not justifiable. Therefore it would not be open to the detenu to ask the Court to consider the question as to whether the said satisfaction of the detaining authority can be justified by the application of objective tests. It would not be open, for instance, to the detenu to contend that the grounds supplied to him do not necessarily or reasonably lead to the conclusion that if he is not detained, he would indulge in prejudicial activities. The reasonableness of the satisfaction of the detaining authority cannot be questioned in a Court of law; the adequacy of the material on 641 which the said satisfaction purports to rest also cannot be examined in a Court of law. That is the effect of the true legal position in regard to the satisfaction contemplated by section 3(1)(a) of the Act (See the decision of this Court in The State of Bombay vs Atma Ram Sridhar Vaidya(1). But there is no doubt that if any of the grounds furnished to the detenu are found to be irrelevant while considering the application of cls. (i) to (iii) of section 3(1)(a) and in that sense arc foreign to the Act, the satisfaction of the detaining authority on which the order of detention is based is open to challenge 'and the detention order liable to be quashed. Similarly, if some of the grounds supplied to the detenu are so vague that they would virtually deprive the detenu of his statutory right of making a representation, that again may make the order of detention invalid. If, however, the grounds on which the order of detention proceeds are relevant and germane to the matters which fall to be considered under section 3 ( 1 ) ( a ) of the Act, it would not be open to the detenu to challenge the order of detention by arguing that the satisfaction of the detaining authority is not reasonably based on any of the said grounds. It is also necessary to emphasise in this connection that though the satisfaction of the detaining authority contemplated by section 3 (1) (a) is the subjective satisfaction of the said ' authority, cases may 'arise where the detenu may challenge the validity of his detention on the ground of mala fides. The detenu may say that the passing of the order of detention was an abuse of the statutory power and was for a collateral purpose. In support of the plea of mala fides the detenu may urge that along with other facts which show mala fides, the grounds served on him cannot rationally support the conclusion drawn against him by the detaining authority. It is only in this incidental manner that this question can become justifiable; otherwise the reasonableness or propriety of the said satisfaction contemplated by section 3(1)(a) cannot be questioned before the Courts. The question to be considered in the present case is whether grounds (a), (b) and (e) served on Subhas Chandra Bose are grounds which are relevant to "the maintenance of public order". All these grounds relate to cases of assault on solitary individuals either by knife or by using crackers and it is difficult to accept the contention of the respondent that these grounds have any relevance or proximate connection with the maintenance of public order. In the present case we are concerned with detention under section 3( 1 ) of the which permits apprehension and detention of a person likely to act in a manner prejudicial to the maintenance of public order. Does the expression "public(1) ; 642 order" take in every kind of infraction of order or only some categories thereof. It is manifest that every act of assault or injury to specific persons does not lead to public disorder. When two people quarrel and fight and assault each other inside a house or in a street, it may be said that there is disorder but not public disorder. Such cases are dealt with under the powers vested in the executive authorities under the provisions of ordinary criminal law but the culprits cannot be detained on the ground that they were disturbing public order. The contravention of any law always affects order but before it can be said to affect public order, it must affect the community or the public at large. In this connection we must draw a line of demarcation between serious and aggravated forms of disorder which directly affect the community or injure the public interest and the relatively minor breaches of peace of a purely local significance which primarily injure specific individuals and only in a secondary sense public interest. A mere disturbance of law and order leading to disorder is thus not necessarily sufficient for action under the but a disturbance which will affect public order comes within the scope of the Act. A District Magistrate is therefore entitled to take action under section 3 (1 ) of the Act to prevent subversion of public order but not in aid of maintenance of law and order under ordinary circumstances. In Dr. Ram Manohar Lohia vs State of Bihar(1), it was held by the majority decision of this Court that the expression "public order" was different and does not mean the same thing as "law and order". The question at issue in that case was whether the order of the District Magistrate, Patna under Rule 30(1)(b) of the Defence of India Rules, 1962 against the petitioner was valid. Rule 30( 1 )(b) provided that a State Government might, if it was satisfied with respect to a person that with a view to preventing him from acting in a manner prejudicial to 'public safety and maintenance of public order ' it is necessary to do so, order him to be detained. The order of the District Magistrate stated that he was satisfied that with a view to prevent the petitioner from acting in any manner prejudicial to the 'public safety and the maintenance of law and order, ' it was necessary to detain him. Prior to the making of the order the District Magistrate had, however, recorded a note stating that having read the report of the Police Superintendent that the petitioner 's being at large was prejudicial to 'public safety ' and 'maintenance of public order ', he was satisfied that the petitioner should be detained under the rule. The petitioner moved this Court under article 32 of the Constitution for a writ of habeas corpus directing his release from detention, contending that though an order of detention to prevent acts prejudicial to public order may be justifiable ,an order to prevent acts prejudicial to law and order would not be justified by the rule. It was held by the majority judgment that what was (1) ; , 643 meant by maintenance of public order was the prevention of disorder of a grave nature, whereas, the expression 'maintenance of law and order ' meant prevention of disorder of comparatively lesser gravity and of local significance. At page 746 of the Report, Hidayatullah, J. as he then was, observed as follows in the course of his judgment: "It will thus appear that just as 'public order ' in the rulings of this Court (earlier cited) was said to comprehend disorders of less gravity than those affecting 'security of State ', 'law and order ' also comprehends disorders of less gravity than those affecting 'public order '. One has to imagine three concentric circles. Law and order represents the largest circle within which is the next circle representing public order and the smallest circle represents security of State. It is then easy to see that an act may affect law and order but not public order just as an 'act may affect public order but not security of the State. By using the expression 'maintenance of law and order ' the District Magistrate was widening his own field of action and was adding a clause to the Defence of India Rules. " The order no doubt mentioned another ground of detention, namely, the prevention of acts prejudicial to public safety, and in so far as 'it did so, it was clearly within the rule. But the order of detention must be held to be illegal, though it mentioned a ground on which a legal order of detention could have been based, because it could not be said in what manner and to what extent the valid and invalid grounds operated on the mind of the authority concerned and contributed to the creation of his subjective satisfaction. It was accordingly held that the order of detention made by the District Magistrate was invalid and the petitioner should be set at liberty. In our opinion, the principle laid down in this case governs the decision in the present case also and the order of the District Magistrate, Howrah dated January 20, 1968 must be held to be ultra vires and illegal. The difference between the concepts of 'public order ' and law and order ' is similar to the distinction between 'public ' and 'private ' crimes in the realm of jurisprudence. In considering the material elements of crime, the historic tests which each community applies are intrinsic wrongfulness and social expediency which are the two most important factors which have led to the designation of certain conduct as criminal. Dr. Allen has distinguished 'public ' and 'private ' crimes in the sense that some offences primarily injure specific persons and only secondarily the public interest, while others directly injure the public interest 'and affect indivi 644 duals only remotely. (see Dr. Allen 's Legal Duties, p. 249). There is a broad distinction along these lines, but differences naturally arise in the application of any such test. The learned author has pointed out that out of 331 indictable English offences 203 are public wrongs and 128 private wrongs. The argument was, however, stressed by Mr. Mukherjee on behalf of the respondent that the other grounds, viz., (c) and (d) mentioned in the order of the District Magistrate dated January 20, 1968 are more serious in character and may be held prejudicial to public order. We shall assume in favour of the respondent that grounds (c) and (d) are matters prejudicial to: public order. But even upon that assumption the order of detention must be held to be illegal. It is now well established that even if any one of the grounds or reasons that led to the satisfaction is irrelevant, the order of detention would be invalid even if there were other relevant grounds, because it can never be certain to what extent the bad reasons operated on the mind of the authority concerned or whether the detention order would have been made at all if only one or two good reasons had been before them. (See the decisions of this Court in Shibban Lal Saksena vs The State of Uttar Pradesh(1) and Dr. Ram Manohar Lohia vs State of Bihar(2). For these reasons we hold that the order of detention made by the District Magistrate, Howrah under section 3(2) of the Act dated January 20, 1968 against petitioner Subhas Chandra Bose alias Kanta Bose and the consequent order made by the Governor dated March 30, 1968 confirming the order of detention under section 11 (1 ) of the Act must be declared to be illegal and accordingly the petitioner. Subhas Chandra Bose alias Kanta Bose is entitled to be released from custody forthwith. In the case of petitioner 2, Sukumar Chaudhury, No. 4, Tarapada Bhowmick, No. 6, Golam Rasul Molliek, No. 16, Sk. Sharafat, No. 17, Hanif Mirza, No. 20, Sk. Mann, and No. 26, Chittaranjan Majhi, the orders of detention suffer from the same defect as that in the case of petitioner No. 5, Subhas Chandra Bose alias Kanta Bose. For the reasons already given we hold that the orders of detention made under section 3(2) of the Act and the orders of confirmation by the State Government under section 11 (1 ) of the Act in the case of all these petitioners are illegal and ultra vires and these petitioners are also entitled to be set at liberty forthwith. We pass on to consider the case of the petitioner mentioned in Group 2. As regards Pushkar Mukherjee, petitioner No. (1) ; (2) ; 645 the order of detention was made by the District Magistrate, 24 Parganas on September 19, 1967 and reads as follows: "Whereas I am satisfied with respect to the person known as Shri Pushkar Mukherjee, son of Late Jaladhar Mukherjee, Madhyamgram (Bireshpally), P.S. Baraset, Dist. 24 Parganas that with a view to preventing him from acting in a manner prejudicial to the maintenance of Public order, it is necessary so to do. And, therefore, in exercise of the power conferred by Section 3(2) of the (Act IV of 1950) I make this oder directing that the said Shri Pushkar Mukherjee, son of Late Jaladhar Mukherjee be detained. B. Majumdar, District Magistrate, 24 Parganas." The grounds of detention were served upon the detenu on the same date and are to the following effect: "Grounds for detention under sub section 2 of section 3 of the (Act IV of 1950). To Shri Pushkar Mukherjee, s/o Late Jaladhar Mukherjee, of Madhyamgram (Bireshpally), P.S. Baraset, District 24 Parganas. In pursuance of the provision of Section 7 of the (Act IV of 1950) as amended by the Preventive Detention (Amendment) Act, 1952 and 1954, you Shri Pushkar Mukherjee, s/o Late Jaladhar Mukherjee of Madhyamgram (Bireshpally), P.S. Baraset, 24 Parganas are hereby informed that you are being detained under section 3(1)(a)(ii) of the on the following grounds : 1. That you have been acting in a manner prejudicial to the maintenance of public order by the commission of offences of riotous conduct, criminal intimidation and assault as detailed below : (i) That on 26 3 1967 at about 11.00 hrs. you along with your associates Harisikesh Samadder 'and others being armed with dagger, spear and iron rods demanded money for drinks from Shri Joy Nath Roy in his Khatal at Katakhal Ganga Nagar, P.S. Baraset and on his refusal to pay the money you along with your associates dragged him out of his room and assaulted ' him and his friend Sudhir Ghose causing injuries on their persons. 646 (ii) That on 19 6 1967 evening you along with your associates threatened Sushil Kumar Chakravorty of Madhyamgram with assault when he was returning home from New Barrackpore Rly Station apprehending that he might inform the police for your arrest in connection with Baraset P.S. Case No. 56 dated 24 3 1967 u/s 302/394 I.P.C. which was pending investigation. (iii) That on 8 7 1967 at about 22.00 hrs. you along with your associates Kalyan Chakraborty and others again threatened Shri Sushil Kumar Chakraborty of Madhyamgram with assault out of previous grudge when he was returning to his house from New Barrackpore Rly Stn. (iv) That you were detained for your rowdy activities u/s 30(1) of the D.I. Rules 1962 from 22 4 1964 under Govt. Order No. 1233 H.S. dated 15 4 1964 and was released from detention on 4 10 1965. (v) That for your rowdy activities you were detained on 19 9 1966 under P.D. Order No. 163/66 which was confirmed under Govt. Order No. 8999 H.S. dated 26 11 1966 and you were released from such detention on 13 3 1967 under Order No. 1095 H.S. dated 13 3 1967 during General release. Thus from your activities subsequent to your release from detention under the P.D. Act on 13 3 1967 it appears that the detention did not produce the sobering effect on you. You have become a menace to the society and there have been disturbances and confusion in the lives o,f peaceful citizens of Baraset and Khardah P.S. areas under 24 Parganas District and the inhabitants thereof are in constant dread of disturbances of public order. For the above reasons, I am satisfied that you are likely to act in a manner prejudicial to the maintenance of public peace and order, and therefore, I have passed an order for your detention to ensure the maintenance of Public Order. You are further informed that you have right to make a representation in writing against this order under which you are detained. If you wish to make such a representation, you should address it to the Assistant Secretary, Govt. of West Bengal (Home Special) Department, Writers ' Buildings, Calcutta through the Superintendent of your Jail as soon as possible. Your case will be submitted to the Advisory Board within 30 days of your detention and your representation if received later, may not be considered by the Board. V. You are also informed that under Section 10 of the (Act IV of 1950), the Advisory Board, shall, if you desire to be heard, hear you in person and that if you desire to be so heard by the Advisory Board you should 647 A intimate such desire in your representation to the State Government. B. MAJUMDAR. District Magistrate, 9 9 67. 24 Pargan as. " On May 23, 1968, the Advisory Board reported that there was sufficient cause for detention of the detenu. On June 12, 1968 the Government of West Bengal confirmed the order of detention under section 11 ( 1 ) of the Act. It appears to us that ground No. 2 is extremely vague. Ground No. 2 states "You have become a menace to the society and there have been disturbances and confusion in the lives of peaceful citizens of Baraset and Khardah P.S. areas under 24 Parganas District and the inhabitants thereof are in constant dread of disturbances of public order. " It is manifest that this ground is extremely vague and gives no particulars to enable the petitioner to make an adequate representation against the order of detention and thus infringes the constitutional safeguard provided under Art 22 ( 5 ) Reference may be made in this connection to the decision of this court in the state of Bombay vs Alma Ram ion of this Court in The State Sridhar Vaidva(1) in which Kania of Bombay vs Atma Ram C.J. observed as follows: "What is meant by vague ? Vague can be considered as the antonym of 'definite '. If the ground which is supplied is incapable of being understood or defined with sufficient certainty it can be called vague. It is not possible to state affirmatively more on the question of what is vague. It must vary according to the circumstances of each case. It is however improper to contend that a ground is necessarily vague if the only answer of the detained person can be to deny it. That is a matter of detail which has to be examined in the light of the circumstances of each case. If on reading the ground furnished it is capable of being intelligently understood and is sufficiently definite to furnish materials to enable the detained person to make a representation against the order of detention it cannot be called vague. The only argument which could be urged is that the language used in specifying the ground is so general that it does not permit the detained ' person to legitimately meet the charge against him because the only answer which he can make is to say that he did not act as generally suggested. In certain cases that argument may support the contention that having regard to the general language used in the ground he has not been given the earliest opportunity to make a representation against the order of detention. It ' cannot be disputed that the represen (1) ; 648 tation mentioned in the second part of article 22(5). must be one which on being considered may give relief ' to the detained person. " It was, however, argued by Mr. Debabrata Mukherjee on behalf of the respondent that even though ground No. 2 may be vague, the other grounds supplied to the detenu are not vague and full and adequate particulars have been furnished. But it is well established that the constitutional requirement that the grounds must not be vague must be satisfied with regard to each of the grounds communicated to the person detained subject to the claim of privilege under cl. (6) of article 22 of the ConstitUtion 'and therefore even though one ground is vague and the other grounds are not vague, the detention is not in accordance with procedure established by law and is therefore illegal. (See the decision of this Court in Dr. Ram Krishan Bhardwaj vs The State of Delhi(1). For these reasons we hold that the order of detention made against the petitioner, Pushkar Mukherjee by the District Magistrate, 24 Parganas on September 19, 1967 and 'the consequent order of the Governor of West Bengal dated June 12, 1968 confirming the order of detention were illegal and ultra vires and the petitioner is entitled to be set at liberty forthwith. In the case of petitioners No. 3, Barun Kumar Hore, No. 7 Karfick Dey, No. 10, Ajit Basak, No. 12, Sk. Idris, No. 13, Shamsuddin Khan, No. 19, Khokan Mitra and No. 22, Ranjit Kumar Ghosal, the orders of detention suffer from the same legal defect as the order of detention in the case of petitioner No. 1, Pushkar Mukherjee. For the reasons already stated, we hold that the orders of detention and the orders of confirmation made by the State Government under section 11 (1 ) of the Act in the case of these seven petitioners also are illegal and ultra vires and these petitioners are also entitled to be set at liberty forthwith. As regards the cases of the remaining petitioners, nos., 8, 9 and 21, Chandan P. Sharma, Sk. Sahajahan and Bind Parmeshwar Prasad, alias Bindeshwari Prosad respectively, we have persued the orders of detention and the grounds supplied to these petitioners. It is not shown by learned Counsel on their behalf that there is any illegality in the orders of detention or in the subsequent procedure followed for confirming these orders. In our opinion, no ground is made out for grant of a writ of habeas corpus so far as these petitioners are concerned. Their applications for grant of a writ of habeas corpus are accordingly rejected. We desire to say that we requested ' Mr. Kohli to assist us on behalf of the petitioners and we are indebted to him for his assistance. Y.P. Petitions dismissed.

In petitions for the writ of habeas corpus under article 32 of the Constitution for release from detention under orders passed under section 3(2) of the Prevention of Detention Act, HELD: The reasonableness of the satisfaction of the detaining authority cannot be; questioned in a Court of law; the adequacy of the material on which the said satisfaction purports to rest also cannot be examined in a Court of law. But if any of the grounds furnished to the detent are found to be irrelevant while considering the application of cls. (i) to (iii) of section 3(1)(a) of the Act and in that sense are foreign to the Act, the satisfaction of the detaining authority on which the order of detention is based is open to challenge and the detention order liable to be quashed. [640 H 641 C] Even if any one of the grounds or reasons that led to the satisfaction was irrelevant, the order of detention would be invalid even if there were other relevant grounds, because it could never be certain to what extent the bad reasons operated on the mind of the authority concerned or whether the detention order would have been made at all if only one or two good reasons had been before them. Similarly, if some of the ground supplied to the detent are so vague that they would virtually deprive the detent of his statutory right of making a representation, that again may make the order of detention invalid. If, however, the grounds on which the order of detention proceeds are relevant and germane, to the matters which fall to be considered under section 3(1)(a) of the Act, it would not be open to the detenu to challenge the order of detention by arguing that the satisfaction of the detaining authority is not reasonably based on any of the said grounds. Though the satisfaction of the detaining authority contemplated by section 3(1)(a) is the subjective satisfaction of the said authority, cases may arise: where the detenu may challenge the validity of his detention on the ground of mala fides. [641 B F, 644 C D] In the present case, (1) with respect to some of the petitioners three of the grounds of detention related to cases of assault on solitary individuals either by knife or by using crackers. It could not be held that these grounds had any relevance or proximate connection with the maintenance of public order. Therefore the orders of detention of these petitioners were illegal and ultra virex. The expression "public order" in section 3 (1) of the Act does not take in every kind of infraction of law. When two people quarrel and fight 'and assault each other inside a house or in a street, it may be said that there is disorder but not public disorder. Such cases are dealt with under the powers vested in the executive authorities under the provisions of ordinary criminal law but the culprits cannot be detained on the 636 ground that they were, disturbing public order. The contravention of any law always affects order but before it can be said to affect public order, it must affect the community or the public at large. A line of demarcation between serious and aggravated forms of disorder which directly affect the community or injure the public interest must be drawn and the, relatively minor breaches of peace of a purely local significance which primarily injure specific individuals and only in a secondary sense public interest. A mere disturbance of law and order leading to disorder is thus not necessarily sufficient for action under the Preventive Detention Act but a disturbance which will affect public order comes within the scope of the Act. A District Magistrate is therefore entitled to take action under section 3( 1 ) of the Act to prevent subversion of public order but not in aid of maintenance of law and order under ordinary circumstances. The difference= between the concepts of 'public order ' and 'law and order ' is similar to the distinction between 'public ' and 'private ' crimes in the realm of jurisprudence. In considering the material elements of crime, the historic Jests which each community applies are intrinsic wrongfulness and social expediency which are the two most important factors which have led to the designation of certain conduct as criminal. 'Public ' and 'private ' crimes have been distinguished in the sense that some Offences primarily injure specific persons and only secondarily the public interest, while others directly injure the public interest and affect individuals only remotely. [641 H 642 D; 643 G, H] The State of Bombay vs Atma Ram: Sridhar Vaidya, ; ; Dr. Ram Manohar Lohia vs State of Bihar, ; ; Shibban Lal Saksena vs The State of Uttar Pradesh, ; , followed. (2) One of the grounds of detention supplied to some of the other petitioners, stated, that they had become a menace to the society and there had been disturbances and confusion in the lives of peaceful citizens of the locality and that the inhabitants thereof were in constant dread of disturbances of public order. The ground was extremely vague and gave no particulars to enable the petitioners to make an adequate representation against the order of detention and this infringed the Constitutional safeguard provided under article 22(5). Therefore, the orders of detention of these petitioners were illegal and ultra vires. The Constitutional requirement that the ground must not be vague must be satisfied with regard to each of the grounds communicated to the person detained subject to the claim of privilege under el. (6) article 22 of the Constitution and therefore even though one ground was vague and the other grounds were not vague, the detention was not in accordance with procedure established by law and was therefore illegal. [648 B C] Dr. Ram Krishan Bhardwaj vs The State of Delhi, ; , followed.

Civil Appeal No. 1083 of 1977. (Appeal by Special Leave from the Judgment and Order dated 28 1 1977 of the Punjab Haryana High Court in Civil Writ No. 5697/75) CIVIL APPEAL NO: 1616 OF 1978 (Appeal by Special Leave from the Judgment and Order dated 18 9 1978 of the Punjab & Haryana High Court in CWP No. 3849/78) CIVIL APPEAL NOS;1700 1761 OF 1978 (Appeals by Special Leave from the Judgment and Order dated 30 8 1978 of the Punjab & Haryana High Court in Civil Writ Petition Nos. 3351, 2662, 3094, 3221, 3303, 3330, 3347, 3348, 3349, 3350, 1225 3384, 3390, 3393, 3459, 3460, 3489, 3517, 3533, 3548, 3551, 3563, 3570, 3576, 3598, 3615, 3665, 3673, 3773, 3775, 3776, 3826, 3827, 3883, 4024, 4171/77, 37/78, 178, 212, 283, 335, 381, 423, 483, 577, 666, 751, 887, 976, 1021, 1058, 1104, 1164, 1280, 1469/78, 2625/77, 1556/78, 1578/78, 1635, 1859, 1980, 1997 and 2095/78. CIVIL APPEAL NOS. 1762 1773 OF 1978. (Appeals by Special Leave from the Judgment and Order dated 30 8 1978 of the Punjab & Haryana High Court in Civil Writ Petition Nos. 45/78, 888, 1251 1451, 1556 3300, 3330, 3293/77, 3292, 3337, 3385 and 3426/77) CIVIL APPEAL NOS.1626 1627 OF 1978. (Appeals by Special Leave from the Judgment and Order dated 30 8 1978 of the Punjab & Haryana High Court in Civil Writ Petition Nos. 4171/77 and 1356/78) AND WRIT PETITION NOS. 4436, 4470, 4472, 4481, 4485,4564, 4420, 4450, 4460, and 4484 OF 1978 (Under Article 32 of the Constitution) For the Appellants in CA No. 1083/77:A. K. Sen Mr. Ravinder Bana, and Bhal Singh Malik For the RR. 1 2 in CA No. 1083/77: section N. Kackar, Sol. Genl., Hardev Singh and R. section Sodhi, For the Intervener State Agricultural Market Board and Market Committee, Nai Mandi in CA No. 1083/77: V. M. Tarkunde, and section C. Patel. For the Applicant Intervener: in CA No. 1083/77 Mrs. Urmila Kapoor. For the Respondent No. 3 in CA No. 1083/77 H. L. Sibbal, G. G. Garv and Mr. Atma Ram. For the Petitioner in the W.P. except in WPs. 4481, 4470, 4564 Bhal Singh Malik, B. Datta and K. K. Manchanda. For the Petitioners in W.P. Nos.4481, 4564, and for the Appellants in CA No. 1616/78 S.K. Walia, and Mr. M.P. Jha. For the Petitioner in W.P. No.4470/78 Sarva Mitter. For the Respondents in WP.4430, 4472, 4481, 4485/78 and CA 1616/78 W.P.4564/78: Hardev Singh, G. C. Garg and R. section Sodhi. For the Appellants in CA Nos. 1700 1761/78 Anil Diwan, (1703) Adarsh Kumar Goel (in all appeals) Praveen Kumar, Adv. (1703) Miss Bina Gupta, Adv. (1703) Madan Gopal Gupta (1703 to 1752) Sarva Mitter (1751 1761 and all other) For the Petitioners in W.P. Nos. 4420, 4450, 4460, 4484/78: A. K. Sen, (4420) Dr. L. M. Singhvi, (4460) B. Dutta, K. K. Manchanda and Bhal Singh Malik, For R. 1 in Appeal Nos. 1700 1761/78 and WP Nos. 4420, 4450, 4460 and 4484/78: 1226 P. N. Lekhi, (FP 4420) and R. N. Sachthey, For RR. 2 3 in Appeal Nos. 1760 1761/78 and WP Nos. 4420, 4450, 4460 and 4484/78:V. M. Tarkunde, (in CA 1700 and WP 4420) Gian Singh, (WPs. 4420, 4450 4460, 4484 and CAs 1760 1761) section C. Patel. For the Appellants in CA Nos. 1626 1627/78: Mrs. Urmila Kapoor, For the Appellants in CA Nos. 1762 1773/78: K. K. Mohan. For the other appearing RR. in CA Nos. 1762 1763: section C. Patel, The Judgment of the Court was delivered by UNTWALIA, J. In these groups of Civil Appeals and Writ Petitions, broadly speaking, the question which falls for determination is the validity of certain provisions of the Punjab Agricultural Produce Markets Act, 1961 (Punjab Act No. 23 of 1961). hereinafter referred to as the Act, and the Rules framed by the State of Punjab and Haryana under the said Act as also the validity of the fixation of market fees from time to time by the various Market Committees in the States aforesaid under the direction of the Punjab State Agricultural Produce Marketing Board and the Haryana State Agricultural Produce Marketing Board. All these cases have been heard together and are being disposed of by a common judgment. In the erstwhile composite State of Punjab the Act was passed in the year 1961 to consolidate and amend the law relating to the better regulation of the purchase, sale, storage and processing of agricultural produce and the establishment of markets for agricultural produce in the State. Under section 3 of the Act the State Agricultural Marketing Board was constituted for the entire area of the composite State, which later, in the year 1966 came to be bifurcated into the States of Punjab and Haryana. Under the various provisions of the Act, which will be noticed shortly hereinafter, market areas and market yards were declared putting restrictions on the traders to carry on their trade under a licence granted by the various Market Committees established and constituted in accordance with sections 11 and 12, within the specified boundaries or areas. The traders were required to take out licences on payment of a licence fee. Under section 23 of the Act a Market Committee was required and authorised to levy on ad valorem basis fees on the agricultural produce bought or sold by licensees in the notified market area at a rate not exceeding the rate mentioned in section 23 from time to time for every one hundred rupees. 1227 In the composite State of Punjab and even after the bifurcation of the States for about a period of three years the maximum rate of market fee which could be levied under section 23 was 50 paise for every one hundred rupees. Various Market Committees levied a fee of 50 paise per hundred rupees and no dealer made any murmur of grievance of it. In the bifurcated State of Punjab by Act 25 of 1969 the rate of 50 paise was raised to Re. 1/ . It was further raised to Rs. 1.50 by Act 28 of 1973. Thereafter by Ordinance 4 of 1974 which was replaced by Act 13 of 1974 the rate was raised to Rs. 2.25. Several dealers filed a number of Writ Petitions in the High Court of Punjab and Haryana challenging the increase in the rate of market fee from time to time, the last one being by Act 13 of 1974. Similarly in the State of Haryana the rate of 50 paise was raised to Re. 1/ by Haryana Amendment Act 28 of 1969. It was further raised to Rs. 1.50 by Act 21 of 1973. By Ordinance 2 of 1974 which was replaced by Act 17 of 1974 in the State of Haryana the fee was raised to Rs.2/ for every one hundred rupees, as against the rise of Rs. 2.20 in the State of Punjab. Several dealers of the State of Haryana also challenged in the High Court the levy and increase of market fee from time to time. All the Writ Petitions were heard together. The increase and levy of fee upto Rs. 2/ by the various Market Committees in the State of Haryana was upheld and the Writ Petitions of the Haryana dealers were dismissed while those of the Punjab dealers were allowed and the increase of rate brought about by Ordinance 4 and Act 13 of 1974 to the extent of Rs. 2.25 was struck down. This decision of the High Court is reported in M/s. Hanuman Dall & General Mills, Hissar vs The State of Haryana and others. The date of the decision is November 8, 1974. In Punjab by Amendment Act 14 of 1975 section 23 of the Act was again amended authorising the imposition of market fee at a rate not exceeding Rs. 2.20 per hundred rupees. Telegraphic instructions were issued by the Punjab Board to the various Market Committees directing them to charge Rs. 2/ only with effect from August 23, 1975 after the passing of the Act 14 of 1973 on August 8, 1975. The increase in the rates of fee, the last one being in August, 1975, were again challenged in the High Court. But the Full Bench which finally heard the Writ Petition upheld the increases by its judgment delivered on January 28, 1977, which is reported in Kewal Krishan Puri and another vs The State of Punjab and others. Civil Appeal 1083 of 1977 has been preferred in this Court from the said judgment of the High Court. 1228 Both in the State of Punjab and the State of Haryana the rate of market fee was further raised from Rs. 2/ to Rs.3/ . It was unsuccessfully challenged in the High Court. The dealers have preferred appeals from the judgments of the High Court as also filed Writ Petitions in this Court. In the State of Punjab the fee was raised to Rs. 3/ by Ordinance 2 of 1978 which must have been replaced by an Act. The Ordinance was promulgated on April 28, 1978. The Writ Petition 4436 of 1978 has been filed in this Court challenging the previous increases in the fee along with the last increase of Rs. 3/ . The High Court upheld it by its judgment dated May 18, 1978. Special Leave Petition (Civil) 2768 of 1978 was preferred from this judgment. Writ Petition No. 3849 of 1978 was filed in the High Court by a large number of dealers, which was dismissed in limine by order dated September 18, 1978. Civil Appeal 1616 of 1978 arises out of this Writ Petition. Several other dealers have filed separate Writ Petitions also being Writ Petitions 4470, 4472, 4481, 4485 and 4564 of 1978 challenging in the increase of market fee in the State of Punjab. In the State of Haryana the rate of fee was raised from Rs. 2/ to Rs.3/ with effect from September 5, 1977 by Ordinance 12 of 1977 replaced by Act 22 of 1977. The Haryana State Marketing Board directed all the Market Committees in that State to collect market fee @ Rs. 3/ with effect from 5 9 1977. A number of Writ Petitions were filed in the High Court challenging the said increase and the High Court dismissed all the Writ Petitions by its judgment dated August 30, 1978. Civil Appeals 1700 to 1773 of 1978 and Civil Appeals 1626 and 1627 of 1978 are from the judgment of the High Court dated August 30, 1978. The said increase has also been challenged by filing Writ Petitions in this Court and they are Writ Petitions 4420, 4450, 4460 and 4484 of 1978. Although by now there is a catena of cases of this Court pointing out the difference between "tax" and "fee" with reference to the constitutional provisions and otherwise also, the problem before us has presented some new angles and facets. We, therefore, think it advisable and necessary to review many of the earlier decisions to pin point the precise difference as far as practicable in order to resolve the rival contentions of the parties. The arguments of the learned counsel for the parties whenever thought necessary would be referred to at the appropriate places hereinafter in this judgment. Clause (2) of Article 110 and clause (2) of Article 199 of the Constitution, the former occurring in the Chapter of Parliament and the 1229 latter in relation to the State Legislature, are in identical terms as follows: "A Bill shall not be deemed to be a Money Bill by reason only that it provides. . .for the demand or payment of fees for licences or fees for services rendered. . The Constitution, therefore, clearly draws a distinction between the imposition of a tax by a Money Bill and the impost of fees by any other kind of bill. So also in the Seventh Schedule both in List I and in a distinction has been maintained in relation to the entires of tax and fees. In the Union List entries 82 to 92A relate to taxes and duties and entry 96 carves out the legislative field for fees in respect of any of the matters in the said list except the fees taken in any Court. Similarly in the State List entries relating to taxes are entries 46 to 63 and entry 66 provides for fees in respect of any of the matters in List II but not including fees taken in any Court. Entry relating to fees in List III is entry 47. Our Constitution, therefore, recognises a different and distinct connotation between taxes and fees. The leading case of this Court which has been referred and followed in many subsequent decisions is the case of The Commissioner, Hindu religious Endowments, Madras vs Sri Lakshmindra Thirtha Swamiar of Sri Shirur Mutt. The point decided therein was that the provision relating to the payment of annual contribution contained in section 76(1) of the Madras Hindu Religious and Charitable Endowments Act, 1951 is a tax and not a fee and so it was beyond the legislative competence of the Madras State Legislature to enact such a provision. The meaning given to the word "tax" by Latham C.J. of the High Court of Australia in Matthews vs Chicory Marketing Board has been quoted with approval at page 1040 and has been often repeated in many other decisions. Generally speaking a fee is defined to be a charge for a special service rendered to individuals by some governmental agency. A question arises "special service" rendered to whom which kind of individuals? Mr. V.M. Tarkunde who appeared for the Haryana Marketing Board stressed the argument that service rendered must be correlated to those on whom the ultimate burden of the fee falls. In our opinion this argument is neither logical nor sound. The impost of fee and the liability to pay it is on a particular individual or a class of individuals. They are under the obliga 1230 tion to submit accounts, returns or the like to the authorities concerned in cases where quantification of the amount of fees depends upon the same. They have to undergo the botherations and harassments, sometimes justifiably and sometimes even unjustifiably, in the process of discharging their liability to pay the fee. The authorities levying the fee deal with them and realize the fee from them. By operation of the economic laws in certain kinds of impositions of fee the burden may be passed on to different other persons one after the other. A few lines occurring at page 119 in the judgment of the Privy Council in the case of Attorney General for British Columbia and Esquimalt and Nanaimo Railway Company and others may be quoted with advantage. They are as follows: "It is probably true of many forms of tax which are indisputably direct that the assessee will desire, if he can, to pass the burden of the tax on to the shoulders of another but this is only an economic tendency. The assessee 's efforts may be conscious or unconscious, successful or unsuccessful; they may be defeated in whole or in part by other economic forces. This type of tendency appears to their Lordships to be something fundamentally different from the "passing on" which is regarded as the hall mark of an indirect tax. " The authorities, more often than not, almost invariably, will not be able to know the individual or individuals on whom partly or wholly the ultimate burden of the fee will fall. They are not concerned to investigate and find out the position of the ultimate burden. It is axiomatic that the special service rendered must be to the payer of the fee. The element of quid pro quo must be established between the payer of the fee and the authority charging it. It may not be the exact equivalent of the fee by a mathematical precision, yet, by and large, or predominantly, the authority collecting the fee must show that the service which they are rendering in lieu of fee is for some special benefit of the payer of the fee. It may be so intimately connected or interwoven with the service rendered to others that it may not be possible to do a complete dichotomy and analysis as to what amount of special service was rendered to the payer of the fee and what proportion went to others. But generally and broadly speaking it must be shown with some amount of certainty, reasonableness or preponderance of probability that quite a substantial portion of the amount of fee realised is spent for the special benefit of its payers. 1231 We may now extract some very useful and leading principles from the decision of this Court in Shirur Mutt 's ; , supra) pointing out the difference between tax and fee. At pages 1040 41 says Mukherjea J., as he then was: "The second characteristic of tax is that it is an imposition made for public purpose without reference to any special benefit to be conferred on the payer of the tax. This is expressed by saying that the levy of tax is for the purposes of general revenue, which when collected forms part of the public revenues of the State. As the object of a tax is not to confer any special benefit upon any particular individual, there is, as it is said, no element of quid pro quo between the tax payer and the public authority. " "a 'fee ' is generally defined to be a charge for a special service rendered to individuals by some governmental agency. " At page 1042 the learned Judge. enunciates "The distinction between a tax and a fee lies primarily in the fact that a tax is levied as a part of a common burden, while a fee is a payment for a special benefit or privilege Public interest seems to be at the basis of all impositions, but in a fee it is some special benefit which the individual receives. " After pointing out the ordinarily there are two classes of cases where Government imposes 'fee ' upon persons, the first being the type of cases of the licence fees for Motor Vehicles or the like and in the other class of cases . the Government does some positive work for the benefit of persons and the money is taken as the return for the work done or services rendered" (vide page 1043), it is said further "If the money thus paid is set apart and appropriated specifically for the performance of such work and is not merged in the public revenues for the benefit of the general public, it could be counted as fees and not a tax. There is really no generic difference between the tax and fees and as said by Seligman, the taxing power of a State may manifest itself in three different forms known respectively as special assessments, fees and taxes. "Finally at page 1044 the striking down by the High Court of the imposition of fee under section 76. Of the Madras Act was upheld on the ground "It may be noticed, however, that the contribution that has been levied under section 76 of the Act has been made to depend upon the capacity of the payer and not upon the quantum of benefit that is supposed to be conferred on any particular religious institution. " Benefit conferred or any particular religious institution would have been undoubtedly benefit conferred on the payer of the fee. 1232 After the decision of this Court in Shirur Mutts case (supra) section 76 of the Madras Act was amended. The effect of the amendment came to be considered by this Court in the case of H. H. Sudhundra Thirtha Swamiar vs Commissioner for Hindu Religious & Charitable Endowments. Mysore.(1) Pointing out the various differences between the earlier law and the amended one at pages 320 21 the imposition of fee was upheld. In two other cases of this Court following the ratio of Shirur Mutt 's decision the imposition of fee was upheld, vide, Mahant Sri Jagannath Ramanuj Das and another vs The State of Orissa and another and Ratilal Panachand Gandhi vs The State of Bombay and other . (3) We now proceed to consider. some more decisions of this Court in which apparently some different phrases were used for explaining the meaning of the word 'fee ' and its distinction from 'tax '. Both sides placed reliance upon those decisions. But if the phrases are understood in the context they were used and with reference to the facts those cases it would be noticed that the leading principle has not basically undergone any change. In the case of The Hingir Rampurr Coal Co. Ltd. & Ors. vs The State of Orissa and others(4) the challenge was to the cess levied by the orissa Mining Areas Development Fund Act, 1952. The petitioners ' stand in the first instance was that the cess levied was not a fee but a duty of excise on coal and hence beyond the competence of the State Legislature. Alternatively they contended that even if it was a fee it was beyond the competence of the State Legislature for some If other reason not necessary to be mentioned here. The cess imposed was upheld as a 'fee ' relatable to Entry 23 of List II read with Entry 66. In other words it was upheld as a 'fee ' in respect of regulation of mines and mineral development. Gajendragadkar J., as he then was, delivered the judgment on behalf of the majority and discussed the point at some length. At page 545 are to be found a few words which go directly against the contention of Mr. Tarkunde. Says the learned Judge: ". a fee is levied essentially for services rendered and as such there is an element of quid pro quo between the person who pays the fee and the public authority which imposes it." 1233 (Emphasis supplied). Mr. Tarkunde, however, relied upon a passage at the same page which runs thus: "If specific services are rendered to a specific area or to a specific class of persons or trade or business in any local area, and as a condition precedent for the said services or in return for them cess is levied against the said area or the said class of persons or trade or business the cess is distinguishable from a tax and is described as a fee. " The above passage does not mean that the service rendered is unconnected with or not meant for the payer of the fee. As pointed out earlier, service rendered to an institution like a Math is a service rendered to the payer of the fee. Similarly services rendered to a specific area or to a specific class of trade or business in any local area must mean, and cannot but mean, that it is for the special benefit of the person operating in that area. The service rendered was to the mining area for the benefit of the mine owners at that area. The area or trade does not pay the fee nor does it get the benefit in vacuum. The fee is paid by the person who is liable to pay it and service to the payer does not mean any personal or domestic service to him but it means service in relation to the transaction, property or the institution in respect of which he is made to pay the fee. Says the learned Judge at page 549: "It is true that when the Legislature levies a fee for rendering specific services to a specified area or to a specified class of persons or trade or business, in the last analysis such services may indirectly form part of services to the public in general. If the special service rendered is distinctly and primarily meant for the benefit of a specified class or area the fact that in benefitting the specified class or area the State as a whole may ultimately and indirectly be benefitted would not detract from the character of the levy as a fee. Where, however, the specific service is indistinguishable from public service, and in essence is directly a part of it, different considerations may arise. In such a case it is necessary to enquire what is the primary object of the levy and the essential purpose which it is intended to achieve. Its primary object and the essential purpose must be distinguished from its ultimate or incidental results or consequence . That is the true test in determining the character of the levy." (underlining, ours) At pages 549 50 in the decision of The Hingir Rampur Coal Co. Ltd. (supra), reference has been made in passing to the decision of 1234 the Australian High Court in Patron vs Milk Board (Victoria).(1) The majority which, amongst others, included Dixon J., held the purported levy to be invalid because it was the imposition of a duty of excise, there being no element of quid qua to the person on whom the levy had been imposed. Since a few lines from the judgment of Dixon J., occurring at pages 258 259 will be very helpful in tackling with the problem we are faced with, we may quote them. They are as follows: "It is an exaction for the purposes of expenditure out of a Treasury fund. The expenditure is by a government agency and the objects are governmental. It is not a charge for service. No doubt the administration of the Board is regarded as beneficial to what may loosely be described as the milk industry. But the Board performs no particular service for the dairyman or the owner of a milk depot for which his contribution may be considered as a fee or recompense. . . . On the other hand it is a trading tax. "Customs and excise duties are, in their essence, trading taxes, and may be said to be more concerned with the commodity in respect of which the taxation is imposed than with the particular person from whom the tax is exacted": Attorney General for British Columbia vs Kingcome Navigation Co [1934] A.C. 45, at p. 59. At page 554 is to be found the final conclusion of Gajendragadkar J., which is the crux of the matter. It runs: Thus the scheme of the Act shows that the cess is levied against the class of persons owning mines in the notified area and it is levied to enable the State Government to render specific services to the said class by developing the notified mineral area. There is an element of quid pro quo in the scheme, the cess collected is constituted into a specific fund and it has not become a part of the consolidated fund, its application is regulated by a statute and is con fined to its purposes, and there is a definite correlation between the impost and the purpose of the Act which is to render service to the notified area." (underlining, ours). In the case of Corporation of Calcutta and another vs Liberty cinema(2) the respondent was charged by the Calcutta Corporation a 1235 very high licence fee assessed according to the sanctioned seating capacity of the Cinema house. The High Court quashed the imposition. In appeal to the Supreme Court the stand of the appellant Corporation was that the levy was a tax and section 548(2) of the Calcutta Municipal Act did not suffer from the vice of excessive delegation: while the respondent cinema contended that the levy was a fee and had to be justified as being imposed in return for services to be rendered. Alternatively the respondent submitted that if it was a tax it was invalid as it amounted to an illegal delegation of legislative functions. The majority view was expressed by Sarkar J., as he then was, and the impost was upheld as a tax. In the minority opinion delivered by Ayyangar J., it was held that even in the case of a licence fee a correlation between the fee charged and the service rendered was necessary to be established. It was, therefore, held to be a tax but invalidly imposed under a power suffering from the vice of unconstitutional legislative delegation. In the cases before us the licence fees charged from the various traders in the market areas are not excessive and have not been attacked on any ground whatsoever. We are. therefore, not concerned to find out whether an element of quid pro quo is necessary in cases of all kinds of licence fees. Some licences are imperative to be taken only by way of regulatory measure, some are in the nature of grant of exclusive right or privilege of the State, such as, excise cases noticed by this Court in the case of Har Shankar & ors. vs The Dy. Excise & Taxation Commr. & Ors (1) Some may be cases of licence fees where element of qid pro quo is necessary to be established. But what is important to be pointed out from the case of Liberty Cinema (supra) is that in the case of a fee of the kind with which we are concerned in this case the element of quid pro quo must be established. Otherwise the imposition of fee will be bad. In the majority opinion, it is stated at page 490: "The conclusion to which we then arrive is that the levy under s.548 is not a fee as the Act does not provide for any service to him. No question here arises of correlating the to the person on whom it is imposed. The work of inspection done by the Corporation which is only to see that the terms of the licence are observed by the licensee is not a service to him. No question here arises of correlating the amount of the levy to the costs of any service. The levy is a tax." 1236 Ayyangar J., also said at page 526 that there being no correlation between the fee charged and the service rendered the impugned levy was not authorised. Mr. Tarkunde at one stage of the hearing endeavoured to submit, although the Solicitor General appearing for the State of Punjab and Mr. H. L. Sibbal for the Punjab Marketing Board had made no such submissions, that the impugned impost could be justified as a tax. There was no lack of legislative competence in imposing a tax of the kind under issue. Counsel further submitted that in almost all the cases in absence of quid pro quo the levy was held to be bad and unsustainable as a tax for want of legislative competence. On the other hand learned counsel for the appellants and the petitioners M/s. A. K. Sen, Anil Dewan, B. section Malik and A. K. Goel pointed out that at no pointed of time the respondent sought to justify the impost as a tax obviously because it would have then violated the provisions of the Sales Tax law which did not authorise the imposition of such a tax beyond a certain percentage, and as a tax it could not be but a sales tax. Finally this controversy was not pursued when we pointed out that at no stage the question was raised and no attempt any stage was made to justify it as a tax. Obviously the Market Committees could not be competent under the Act to impose any tax: on the sale and purchase of the agricultural produce in the market nor did it ever purport to do so The nature of the impost and the power. under which it was levied squarely and uniformally remained within the realm of the fee and fee of the kind which could not but sustained on the establishment of the element of quid pro quo between the authority charging the fee and its payer. The next case to be considered is the decision of this Court in Nagar Mahapalika Varanasi vs Durga Das Bhattacharya & ors.(l) in which it was held that the annual licence fee charged from the rickshaw owners and the drivers by the Varanasi Municipal Board could be justified only on the basis of the element of quid pro quo. The fee was held to be ultra vires and illegal because after excluding certain items of expenditure the balance did not constitute sufficient quid pro quo for the amount of the licence fee charged. It could not be sustained as a tax. Certain major items of expenditure incurred by the Municipal Board were attributable to the discharge of its statutory duty and, therefore, at page 386 it was said by Ramaswami J., it is manifest that the licence fee cannot be imposed for reimbursing the cost of ordinary municipal serves which the Municipal 1237 Board was bound under the statute to provide to the general public. " The expenditure incurred by the Municipal Board for the benefit of the licensees constituted 44% of the total income of the Municipal Board and hence it was held that there was no sufficient quid pro quo established in the circumstances of the case. In Delhi Cloth & General Mills Co. Ltd. vs Chief Commissioner Delhi & ors.(l) the High Court had found the 60% of the amount of licence fees charged from the mills was actually spent on services rendered to the factory owners. On that basis sufficient quid pro was found to exist and the impost was upheld by this Court also. We may, however, add that the rule of 60% cannot be of universal application. It is not a static rule. The cases of licence fees are, generally speaking, on some different footing. There is a substantial element of regulatory measure involved in them. Over and above that a good portion of the fee, may be in the neighbourhood of 60% or more, must be correlated to the service rendered to the person from whom the fee is charged. But there may be cases where, as in the instant one, the licence fee charged by way of regulatory measure is not exorbitant or excessive. But the other kind of fee charged has got to be justified on the ground of existence of sufficient quid pro quo between the payer of the fee and the authority charging it. In such a case from a practical point of view it may be difficult to find out with arithmetical exactitude as to what amount of fee has gone in incurring the expenditure for the services. But, broadly speaking, a good and substantial portion of it must be shown as being spent for the services rendered. Now we come to the decision of this Court in Indian Mica & Micanite Industries Ltd . vs State of Bihar & ors.(2) wherein Hegde J., speaking on behalf of a Constitution Bench of this Court, reviewed all the earlier cases and pointed out at page 323 that "While a tax invariably goes into the consolidated fund, a fee is earmarked for the specified services in a fund created for the purpose. " Concludes the learned Judge at pages 324 25: "From the above discussion it is clear that before any levy can be upheld as a fee, it must be shown that the levy has reasonable co relationship with the services rendered by the Government. In other words the levy must be proved to be a qui pro quo for the services rendered. But in these matters it will be impossible to have an exact co relationship. The co relationship expected is one of a general character and not as of arithmetical exactitude." 1238 Difference between a licence to regulate a trade, business or profess on in public interest and in a case where a Government which is the owner of a particular property may grant permit or licence to some one to exploit that property for his benefit for consideration has been pointed out at page 325. The State of Bihar had failed to place materials in the High Court to establish the reasonable co relationship between the value of the services rendered with the fee charged. For some special reasons the case was remanded. But one thing may be pin pointed from a passage occurring at page 327 that the expenses of maintaining an elaborate staff by the Excise Department were not only for the purposes of ensuring that denaturing is done properly by the manufacturer but also for the purpose of seeing that the subsequent possession of denatured spirit in the hands either of a wholesale dealer or retail seller or any other licensee or permit holder is not misused by converting the denatured spirit into alcohol fit for human consumption and thereby evade payment of heavy duty. But the appellant before the Supreme Court or other similar licensees had nothing to do with the manufacturing process. They were only the purchasers of manufactured denatured spirit. In that context it was said "Hence the cost of supervising the manufacturing process or any assistance rendered to the manufacturers cannot be recovered from the consumers like the appellant. " When we come to discuss even from the admitted facts in relation to the levy of impugned market fees, we shall point out that the authorities concerned as also the High Court labour under the impression that the fee realized from the traders in the market could be spent for any purpose of development of agriculture by providing all sorts of facilities to the agriculturists including the facilities of link roads for the purpose of trans port of their agricultural produce to the markets how so ever distant these link roads may be from the market proper or any other purchasing centre in the market. In the case of Secretary, Government of Madras, Home Department and another vs Zenith Lamp & Electrical Ltd.(1) the character of Court fees came up for consideration as to whether they are taxes or fees or whether they are sui generis. Although after referring to the various Entries of the Seventh Schedule in the different lists it was noticed that Court fees were not taxes and they were covered by separate Entries of fees exclusively meant for Courts, yet the broad principles of the requirement of quid pro quo were made applicable in the cases of Court fees also. Even so, Sikri C.J. speaking for the Court pointed out at page 982 "But even if the meaning is the same, 1239 what is 'fees ' in a particular case depends on the subject matter ill relation to which fees are imposed. " The learned Chief Justice further observed at the same page "In other words, it cannot tax litigation, and make litigations pay, say for road building or education or other beneficial schemes that a State may have. There must be a broad co relationship with the fees collected and the cost of administration of civil justice. " If the view taken by the High Court in the market fee cases were to hold good, then pushing it to the logical conclusion one will have to say that giving all sorts of facilities to the litigants for their travel from the village homes to the Courts would also be a service of them In cases of court fees one has to take broad view of the matter to find out whether there exists a broad co relationship with the fees collected and the cause of administration of justice. Even mixing the amount of court fee collected with the general fund will be permissible. It may not be kept in a separate fund or earmarked separately. The very fact that in relation to court fees there are separate Entries in the Seventh Schedule e.g. Entry 77 List I and Entry 3 of List II, indicates that even though the character of the levy is not very much different from that of the general types of fees, in the matter of approach for finding out the element of quid pro quo quite a different test has not to be applied as indeed, to some extent it has to be applied in many kinds of fees depending upon the totality of the facts and circumstances. Each case has to be judged from a reasonable and practical point of view for finding out the element of quid pro quo. In the case of State of Maharashtra & ors. vs The Salvation Army, Western India Territory(1) Mathew J., speaking for the Court after resume of some earlier decisions of this Court upheld to a certain extent the fee charged under the Bombay Public Trust Act, 1950 on the ground that taking precautionary measures to see that Public Trusts are administered for the purpose intended by the authors of the Trust and exercising control and supervision with a view to preserve the trust properties from being wasted or misappropriated by trustees are certainly special services for the benefit of the trust. Thus special benefits for the payer of the fee were established, as benefits to the trust were benefits to the trustees who are required to pay the fees out of the trust income. But then it was further pointed out that in spite of accumulation of the surplus from 1953 onwards the authorities went on charging the fee of 2% which has assumed the character of a tax. After giving certain guidelines the levy was declared to be without the authority of law after 31st March, 1970. 1240 Observations of one of us (Chandrachud J., as he then was), speaking for the Court in the case of Government of Andhra Pradesh & Anr. vs Hindustan Machine Tool Ltd.(1) at page 401 are quite apposite and may be usefully quoted here: One cannot take into account the sum total of the activities of a public body like a Gram Panchayat to seek justification for the fees imposed by it. The expenses incurred by a Gram Panchayat or a Municipality in discharging its obligatory functions, are usually met by the imposition of a variety of taxes. For justifying the imposition of fees the public authority has to show that services are rendered or intended to be rendered individually to the particular person on whom the fee is imposed. The Gram Panchayat here has not even prepared an estimate of what the intended services would cost it. ' The levy of house tax was held to be lawful but the levy of Permission Fee had to be struck down as being illegal. In the instant case also it would be noticed that the Market Committees and the Market Boards assumed to themselves the liberty of utilizing and spending the realizations from market fees to a consider able extent, as if it was a tax, although in reality it was not so. In The Municipal Council Maduri vs R. Narayanan etc.(2) endeavour was made as in the case of Nagar Mahapalika Varanasi (supra) to justify the impost by the Municipal Council as a tax. Krishna Iyer J., speaking for the Court repelled that argument and since the impost could not to justified as fee the resolution of the Municipal Council was held to be invalid. In the Chief Commissioner, Delhi and another vs The Delhi Cloth and General Mills Co. Ltd. and others(3) the question for consideration was whether the registration fee charged on the document satisfied the two conditions of fee which were enumerated in the fol lowing language: "(i) there must be an element of quid pro quo that is to say the authority levying the fee must render some service for the fee levied however remote the service may be; (ii) that the fee realised must be spent for the purposes of the imposition and should not form part of the general revenues of the State." 1241 The second condition was found not to be fulfilled and hence the impost was held to be bad. We would like to point out that the first condition is rather couched in too broad and general a language. Rendering some service, however remote the service may be, cannot strictly speaking satisfy the element of quid pro quo required to be established in cases of the impost of fee. But then, as pointed out, in some of the cases noticed earlier the registration fee has been taken to stand on a different footing altogether. In the case of such a fee the test of quid pro quo is not be satisfied with such direct, close or proximate co relationship as in the case of many other kinds of fees. By and large registration fee is charged as a regulatory measure. The history of the marketing legislation was traced by Venkatarama Aiyar J. in the case of P. P. Kutti Keya and others vs The State of Madras and others.(1) A number of Writ Petitions were disposed of by one judgment delivered on 10 7 1953. Appeals in some of these Writ Petitions were brought to this Court in the case of M.C.V. section Arunachala Nadar etc. vs The State of Madras & others.(2) Al though the Courts were concerned mainly with the question of the constitutional validity of the marketing law which is beyond any pale of challenge now, it would be interesting to note that the Madras High Court had taken the view that the funds raised from the merchants for construction of a market in substance amounted to an exaction of a tax. We are not going to approve such a narrow view in relation to the application of the amounts realized by market fees, yet we are not going to make it too broad either, so as to take within its sweep any remote service which may ultimately or tangentically be of some benefit to the grain trade in the market. Subba Rao J., as he then was, speaking for the Court in Arunachala Nadar 'section case (supra) traced the history of the marketing legislation at pages 95 96 and pointed out at page 98: "The Act, therefore, was the result of a long exploratory investigation by experts in the field, conceived and enacted to regulate the buying and selling of commercial crops by providing suitable and regulated markets by eliminating middlemen and bringing face to face to the producer and the buyer so that they may meet on equal terms, thereby eradicating or at any rate reducing the scope for exploitation in dealings. " At page 102 is to be found some discussion with regard to the licence fees which, says the learned Judge, "do not appear to be so high as to cripple the trader 's business. " The question of charge of the market fee apart from the licence fee did not fall for consideration in this case. The Bombay 1242 Marketing Statute came to be considered in the case of Mohammad Hussain Gulam Mohammad and another vs The State of Bombay and another.(1) Wanchoo J., as he then was, speaking for the Court repelled the attack at page 669 on section 11 of the Bombay Act which gives power to the Market Committee subject to the provisions of the rules and subject to such maxima as may be prescribed to levy fees on the agricultural produce bought and sold by licensees in the market area. The attack was that the impost was in the nature of sales tax. It was repelled on the ground that: "Now there is no doubt that the market committee which is authorised to levy this fee renders services to the licensees, particularly when the market is established. Under the circumstances it cannot be held that the fee charged for services rendered by the market committee in connection with the enforcement of the various provisions of the Act and the provisions for various facilities in the various markets established by it, is in the nature of sales tax. It is true that the fee is calculated on the amount of produce bought and sold but that in our opinion is only a method of realising fees for the facilities provided by the Committee." Since the market was not found to have been properly established it was held that the market committee could not enforce any of the pro visions of the Act or the Rules or the bye laws. Therefore, the question of the rate of market fee did not fall for consideration. The Bihar Statute came up for consideration of this Court in the case of Lakhan Lal and others etc. vs The State of Bihar and others. Bachawat J., upheld the validity of the various actions taken by the State Government under the Act and the Rules and finally said at page 539: "But there is no material on the record to show that the Government acted unreasonably or that the market is so wide that the sale and purchase of agricultural produce within it cannot be effectively controlled by the market committee or that the growers within the area cannot conveniently bring their produce to the market yards." In contrast in the present case the whole of the State has been divided into different market areas, although the principal market yard is only one in one area with some sub market yards appertaining to it. We do not mean to suggest in pointing out this difference that the declaration of the whole market area is unreasonable. But the market fee has to be realized from the traders on the purchase of the agricultural produce in the market which consists of the market yards and some purchas 1243 ing centres established at some other places in the area due to the urgency or exigency of the situation. Such a fee cannot be utilised for the purpose of rendering all sorts of facilities and services for the benefit of the agriculturists throughout the area. It may be very necessary to render such services to the agriculturists; rather, they must be rendered. But the laudable and in itself cannot justify the means to achieve that end if the means have got no sanction of the law. In the Bihar case it was found at page 540: "The market committee has appointed a dispute subcommittee for quick settlement of disputes. It has set up a market intelligence unit for collecting and publishing the daily prices and information regarding the stock, arrival and despatches of agricultural produce. It has provided a grading unit where the techniques of grading agricultural produce is taught. the contract form for purchase and sale is standardised. The provisions of the Act and the Rules are enforced through inspectors and other staff appointed by the market committee. The fees charged by the market committee are correlated to the expenses incurred by it for rendering these services. The market fee, of 25 naya paise per Rs. 100/ worth of agricultural produce and the licence fees prescribed by Rules 71 and 73 are not excessive. The fees collected by the market committee form part of the market committee fund which is set apart and earmarked for the purposes of the Act. There is sufficient quid pro quo for the levies and they satisfy the test of "fee" as laid down in Commissioner Hindu Religious Endowments Madras vs Sri Lakshmindra Thirtha Swamiar of Sri Shirur Mutt [954] S.C.R., 1005. " It would be noticed that even the rate of 25 paise per hundred rupees had to satisfy all these tests. In the instant cases we are concerned with the rates of market fee which are much higher than the Bihar rate. Correlative service also, therefore, must satisfy the tests of rendering more services in the market area. The fund cannot be permitted to be utilised for an end, such as, augmenting the agricultural produce etc. , if it has no reasonably direct or close connection with the services rendered to the payers of the fee. From a conspectus of the various authorities of this Court we deduce the following principles for satisfying the tests for a valid levy of market fees on the agricultural produce bought or sold by licensees in a notified market area: (1) That the amount of fee realised must be earmarked for rendering services to the licensees in the notified 1244 market area and a good and substantial portion of it must be shown to be expanded for this purpose. (2) That the services rendered to the licensees must be in relation to the transaction of purchase or sale of the agricultural produce. (3) That while rendering services in the market area for the purpose of facilitating the transactions of purchase and sale with a view to achieve the objects of the marketing legislation it is not necessary to confer the whole of the benefit on the licensees but some special benefits must be conferred on them which have a direct, close and reasonable correlation between the licensees and the transactions. (4) That while conferring some special benefits on the licensees it in permissible to render such service in the market which may be in the general interest of all concerned with the transactions taking place in the market. (5) That spending the amount of market fees for the purpose of augmenting the agricultural produce, its facility of transport in villages and to provide other facilities meant mainly or exclusively for the benefit of the agriculturists is not permissible on the ground that such service in the long run go to increase the volume of transactions in the market ultimately benefitting the traders also. Such an indirect and remote benefit to the traders is in no sense a special benefit to them. (6) That the element of quid pro quo may not be possible, or even necessary, to be established with arithmetical exactitude but even broadly and reasonably it must be established by the authorities who charge the fees that the amount is being spent for rendering services to those on whom falls the burden of the fee. (7) At least a good and substantial portion of the amount collected on account of fees, may be in the neighbourhood of two thirds or three fourths, must be shown with reasonable certainty as being spent for rendering services of the kind mentioned above. 1245 In the light of the principles culled out and enunciated above, we now proceed to examine the relevant provisions of the Act and the rules framed thereunder as in force in the States of Punjab and Haryana. We shall examine the relevant provisions with reference to the Punjab Act and the Rules and will only refer to those of Haryana when some difference of some significance or consequence has got to be pointed out. Under clause (f) of section 2 of the Act "dealer" is defined to mean : "any person who within the notified market area sets up, establishes or continues or allows to be continued any place for the purchase, sale, storage or processing of agricultural produce notified under sub section (l) of section 6 or purchases, sells, stores or processes such agricultural produce. " Clause (hh) inserted by Punjab Act 4O of 1976 says: "licensee" means a person to whom a licence is granted under section 10 and the rules made under this Act and includes any person who buys or sells agricultural produce and to whom a licence is granted as Kacha Arhtia or commission agent or otherwise but does not include a person licensed under section 13. " As per clause (i): market" means a market established and regulated under this Act for the notified market area, and includes a market proper, a principal market yard and sub market yard. " The definition of "market proper" is to be found in clause (k) to mean: "any area including all lands with the buildings thereon, within such distance of the principal market or sub market yard, as may be notified in the official gazette by the State Government, to be a market proper. " "Notified market area" in clause (b) means any area notified under section 6 and clause (n) provides: " "Principal market yard" and "sub market yard" mean an enclosure, building or locality declared to be a principal market yard and sub market yard under section 7. " As already stated the State Agricultural Marketing Board is constituted under section 3 and while enumerating the powers and duties of the 1246 Board it is provided in sub section (9) that "The Board shall exercise superintendence and control over the Committees. " The provision of "Declaration of notified market area" is to be found in section 6(1) which empowers the State Government to declare the area notified under section 5 or any portion thereof to be a notified market area for the purposes of the Act in respect of the agricultural produce notified under section 5 or any part thereof. As already pointed out the whole of the State was intended to be divided in various market areas and was also declared as such under section 6. Under sub section (3) of section 6 after the declaration of the notified market area no person can establish or continue any place for the purchase, sale, storage and processing of the agricultural produce except under a licence granted in accordance with the provisions of the Act, the Rules and the byelaws. A dispute arose between the parties before us as to whether the licence is granted for the whole of the area or for particular places therein. On examining Form in the Rules meant for grant of licence under section 10 we find that the licence is granted for one or more places of business specified in column 6 situated in a particular notified market area named at the top of the licence. There will be no sense in specifying the place of business in the licence if the licensee is to be permitted to establish his place of business any where in a notified market area which is too big and extensive for the control and supervision of a particular market committee. Market yards are declared under section 7 and for each notified market area there can be one principal market yard and one or more sub market yards as may be necessary. The marginal note of section 8 is "No private market to be opened in or near places declared to be markets. " There is some difference in the provisions of the Act as introduced by the Haryana Amendment in relation to the establishment of notified market area, declaration of market yards and the inhibition on any person to establish or continue any place for the purchase "sale, storage and processing of any agricultural produce. " There was also a controversy before us as to the exact interpretation of the language of the two Statutes in relation to such inhibition. But for the purposes of the cases before us it is not necessary to further encumber the judgment by attempting to reconcile by harmonious construction the various provisions of the two Acts in relation to this matter. Suffice it to say that there is no special provision in the Statute for establishment of markets or markets proper as per the definition contained in clauses (i) and (k) of section 2 of the Act, yet it is reasonable to assume that the intention of the legislature is to constitute the market yards as the market proper and ordinarily and generally the market would be the same but may 1247 include some other places where transactions of purchase of agricultural produce by the traders from the producers has been allowed in order to avoid rush in the precincts of the market proper. But one thing is certain that the whole of the market area in no sense can be equated with market or market proper. No body can be allowed to establish a purchasing centre of his own at any place he likes in the market area without there being such a permission or authority from the Market Committees. After all the whole object of the Act is the supervision and control of the transactions of purchase by the traders from the agriculturists in order to prevent exploitation of the latter by the former. The supervision and control can be effective only in specified localities and places and not throughout the extensive market area. We have already pointed out that there is no separate notification or declaration establishing a market or market proper. But Rule 24(1) in both the States framed under the Act provides that: "All agricultural produce brought into the market for sale shall be sold by open auction in the principal or sub market yard. " This also indicates that market is generally the principal and sub market yards. The benefit of market fee, therefore, has to be correlated with the transactions taking place at the specified place in the market area and not in the whole of the area. Sections 9 to 10A deal with the procedure of taking out licences, The State Government is empowered under section ll to establish a market committee for every notified market area and to specify its headquarters. The question of constitution of committees is dealt within section 12. The duties and powers of a market committee are enumerated in section 13. It would be seen from clause (a) of subsection (l) of section 13 that it is the duty of the committee to establish a market in the notified market area "providing such facilities for persons visiting it in connection with the purchase, sale, storage, weighment and processing of agricultural produce concerned as the Board may from time to time direct." This also indicates that the Committee is primarily concerned with providing facilities in the market for persons visiting it and in connection with the transactions taking place there. Now we come to the most important section viz section 23. It read as follows: "A Committee shall, subject to such rules as may be made by the State Government in this behalf, levy on ad valorem basis fees on the agricultural produce bought or sold by licensees in the notified market area at a rate not exceeding three rupees for every one hundred rupees: 1248 Provided that (a) no fee shall be leviable in respect of any transaction in which delivery of the agricultural produce bought or section in which delivery is actually made." (b) a fee shall be leviable only on the parties to a transaction in which delivery is actually made. " There is a slight variation in section 23 as amended by Haryana Act 21 of 1973. Therein some market fee may be charged on the agricultural produce even brought for processing by licensees in the notified area. But we are not concerned with the charge of such a fee in any of these cases. Rule 29 of the Punjab Rules says: "Levy and collection of fees on the sale and purchase of agricultural produce. (1) Under section 23 a Committee shall levy fees on the agricultural produce bought or sold by licensees in the notified market area at the rate to be fixed by the Board from time to time. Provided that no such fees shall be levied on the same agricultural produce more than once in the same notified market area. A list of such fees shall be exhibited in some conspicuous place at the office of the Committee concerned: . . . . . . . . . . (2) The responsibility of paying the fees prescribed under sub rule (l) shall be of the buyer and if he is not a licensee then of the seller who may realise the same from the buyer. Such fees shall be leviable as soon as an agricultural produce is bought or sold by a licensee. " The Haryana Rule is substantially the same. Reading section 23 along with Rule 29 it would be noticed that the power of the Committee to levy fees is subject to the Rules as may be made by the State Government. The fee is levied on ad valorem basis at a rate which cannot exceed the maximum, mentioned in section 23 by the legislature. But the power to fix the rate from time to time within the maximum limit has been conferred on the Board and the Committee is merely bound to follow it. One of the arguments before us on behalf of the appellants and the petitioners was that it was the Board which fixed the rate of Rs. 2/ first and thereafter Rs. 3/ 1249 per hundred rupees. The Committee abdicated its function in this regard and, therefore, the levy of fee is contrary to the principle of law laid down by this Court in the case of State of Punjab and another vs Hari Krishan Sharma(l). But the distinction between the said case and the present one is that under the former there was no provision in section 5(l) of the Punjab Cinemas (Regulation) Act of 1952 that the power of the licensing authority to grant licence was subject to any rule, the rule in its turn providing an over riding power in the State Government in the matter of grant of licence. The control of the Government provided in sub section (2) was of a limited kind. On the other hand section 23 in express language controls the power of Committee to levy fees subject to the rules. The power given to the Board to fix the rate of market fees from time to time under rule 29 is not ultra vires the provisions of the Act, as in our opinion sub section (9) of section 3 confers power on the Board to exercise superintendence and control over the Committees, which power, in the context and the scheme of the marketing law will take within its ambit the power conferred on the Board under rule 29(1). It is further to be pointed out that the fee levied is not on the agricultural produce in the sense of imposing any kind of tax or duty on the agricultural produce Nor is it a tax on the transaction of purchase or sale. The levy is an impost on the buyer of the agricultural produce in the market in relation to transactions of his purchase. The agriculturists are not required to share any portion of the burden of this fee. In case the buyer is not a licensee then the responsibility of paying the fees is of the seller who may realise the same from the buyer. But such a contingency cannot arise in respect of the transactions of sale by an agriculturist of his agricultural produce in the market to a dealer who must be a licensee. Nor was any such eventuality occurring in any of the cases before us was brought to our notice. Probably such an alternative provision was meant to be made for outside buyers who are not licensees when they buy the agricultural produce from or through the licensees. Any way we are not concerned with that question. Under section 27(1): "All moneys received by a Committee shall be paid into a fund to be called the Market Committee Fund and all expenditure incurred by the Committee under or for the purposes of this Act shall be defrayed out of such fund, and any surplus remaining after such expenditure has been met shall be invested in such manner as may be prescribed. " 1250 Every Market Committee, is obliged under sub section section (2) (a) of section 27 to pay out of its fund to the Marketing Board as contribution such percentage of its income derived from licence fee, market fee and fines levied by the courts as specified in sub clause(i) and (ii). The purpose of this contribution as mentioned in sub section 2(a) is to enable the Board to defray expenses of the office establishment of the Board and such other expenses incurred by it in the interest of Committees in general. The income of almost all the Market Committees were several lakhs of rupees per year and, therefore, each is required to pay 30 per centum of its income to the Board by virtue of the amendment brought about by Punjab Act 4 of 1978 Under section 25 all receipts of the Board are to be credited into a fund to be called the Marketing Development Fund. Purposes for which the Marketing Development Fund. Purposes for which the Marketing Development Fund may be expanded are enumerated in section 26 and the purposes for which the Market Committee Funds may be expended are catalogued in section 28 We think we shall have to read both the sections in full one by one. First we refer to section 28 which runs as follows: Subject to the provisions of section 27 the Market Committee Funds shall be expended for the following purposes: (i) acquisition of sites for the market; (ii) maintenance and improvement of the market; (iii)construction and repair of buildings which are necessary for the purposes of the market and for the health convenience and safety of the persons using it. (iv) provision and maintenance of standard weights and measures; (v) pay. leave allowances, gratuities, compassionate allowances and contributions towards leave allowances, compensation for injuries and death resulting form accidents while on duty, medical aid, pension or provident fund of the persons employed by the Committee. (vi) payment of interest on loans that may be raised for purpose of the market and the provisions of a sinking fund in respect of such loans; (vii)collection and dissemination of information regarding all matters relating to crop statistics and marketing in respect of the agricultural produce concerned ' 1251 (viii)providing comforts and facilities, such as shelter, shade, parking accommodation and water for the persons, draught cattle, vehicles and pack animals coming or being brought to the market or on construction and repair of approach roads; culverts, bridges and other such purposes; (ix) expenses incurred in the maintenance of the offices and in auditing the accounts of the Committees; (x) propaganda in favour of agricultural improvements, and thrift; (xi) production and betterment of agricultural produce; (xii)meeting any legal expenses incurred by the Committee; (xiii)imparting education in marketing or agriculture; (xiv)payments of travelling and other allowances to the members and employees of the Committee, as prescribed: (xv) loans and advances to the employees; (xvi)expenses of and incidental to elections; and (xvii)with the previous sanction of the Board, any other purpose which is calculated to promote the general interests of the Committee or the notified market area or with the previous sanction of the State Government, any purpose calculated to promote the national or public interest. " Let us first scan these clauses one by one on the footing that the Market Committee Fund will ordinarily and generally and almost wholly will be created out of the income of a particular Market Committee on account of market fees realised by it from the traders in the market. A portion of it may be on account of fines, licence fees, from weighment, arbitration fees etc. But those amounts compared to the huge realisations on account of market fees would be almost negligible. By and large the purposes enumerated in clauses (i) to (ix) are relatable to the service to be rendered in the market in relation to the transactions of purchase and sale of the agricultural produce. We shall deal with the problem of payment of interest on loans that may be raised for purposes of the market as mentioned in clause (vi) shortly hereinafter. Apropos clause (viii) the attention of all concerned must be focussed here because the last part of this clause had led the autho 1252 rities and also the High Court to think that construction of link roads, culverts and bridges any where in a notified market area is covered by this clause. In our opinion it is not so. In the context of the language of all the clauses preceding clause (viii) and clause (viii) itself it is plain that what is meant by "construction and repair of approach roads; culverts, bridges" is only for the purpose of the facility of going into the market from the nearest public road. Supposing a market has been established consisting of principal market yard or sub market yards at a particular place where there is no facility for the carts or the trucks and other vehicles to go, then approach roads, and if necessary even culverts and bridges may be constructed, or repaired out of the Market Committee Fund. Such an expenditure within the limited limit will be with the object of facilitating the taking place of the transactions of purchase and sale in the market and will confer some special benefits to the traders apart from a share of the benefit going to the agriculturists who are not required to share any burden of the market fee. But as we have pointed out above, if one were to give a very wide meaning to this phrase of construction and repair of approach roads, culverts and bridges to say that such construction can be permitted any where in the market area for the facility of the agriculturists which ultimately will benefit the traders also, then the whole concept of correlation of fee and its character of having an element of quid pro quo will dwindle down and become an empty formality. Uplift of villages and helping the agriculturists by all means is the duty and the obligation of the State no doubt and it has to do it by incurring expenses out of the public exchequer consisting of the income from various kinds of taxes etc. One may not have any serious objection to the items of expenditure mentioned in clauses (xii), (xiv), (xv) and (xvi). But the other clauses do require some careful examination. Obviously clause (x) and clause (xi) cannot form the items of expenditure out of the market fees. In face of the view of the law expressed by us above the propaganda in favour of the agricultural improvement and expenditure for production and betterment of agricultural produce will be in the general interest of agriculture in the market area. The whole of the State is divided into market areas. So long as the concept of fee under our Constitution remains distinct and limited in contrast to tax such expenditure out of the market fee cannot be countenanced in law. The first part of clause (xiii) may be justified in the sense of imparting education in marketing to the staff of the Market Committee. But imparting education in agriculture in general cannot be correlated with the market fee. The first part of clause (xvii) is too vague to merit any 1253 discussion on the language of the clause itself until and unless we are faced with concrete examples of such expenditure. But how ill conceived the second part of clause (xvii) is, is abundantly clear from the decisions of the Punjab High Court mentioned above and to be discussed shortly hereinafter. Is it permissible to spend the market fees realised from the traders for any purpose calculated to promote the national or public interest ? Obviously not. No Market Committee can be permitted to utilise the fund for an ulterior purpose howsoever benevolent, laudable and charitable the object may be. The whole concept of fee will collapse if the amount realised by market fees could be permitted to be spent in this fashion. We may, however, mention one matter pointedly in connection with the Market Committee Fund. Under section 32 the Committee may borrow money for carrying on the purposes for which it is established on the security of any property vested in and belonging to the Committee. It may obtain a loan from the State Government or the Board. In the various figures and charts submitted before us it was shown that the Market Committees had raised money by loan and other methods. That also will form the market committee fund. Technically and legally, therefore, one may not have any objection to the expenditure of such money for the purposes mentioned in clauses (x), (xi) (xiii) and (xvii). As we indicated above clause (vi) provides for payment of interest on loans, but that is confined to loans that may be raised for purposes of the market and not for any other purpose, whereas, the power of the Committee to raise loans under section 32 is very wide. The Act, however, is silent as to where from interest will be paid or the principal will be returned in regard to the amount of loan raised for a purpose other than the purpose of the market. Since we find that the matter has proceeded at various stages in the High Court as also in this Court under a great confusion of the correct position of law, we do not propose to express any opinion in this regard at this stage. Nor do we propose to strike any clause of section 28 as being unconstitutional merely on the ground that the expenditure authorised therein goes beyond the scope of the purpose of the utilisation of the market fees. The authorities have to bear this in mind and on a proper occasion the matter will have to be dealt with by courts in the light of this judgment where a concrete case comes of raising of a loan, spending the money so raised which cannot be reasonably connected with the purposes for which the market fee can be spent, as to whether such a loan can be repaid or interest on it can be paid out of the realizations of the market fees. One of the points mooted before us was as to how far the market committees can be compelled to part with 30% of their income in favour of the Marketing Board. If so, for what purposes the Board 1254 fund, namely, the Marketing Development Fund can be expanded. It is to be remembered that market fee is levied by each and every Market Committee separately in its own area and if a good and substantial portion of this fee has got to be expanded for rendering services in the area to the payers of the fee in relation to the transactions taking place therein, then logically speaking it flows from it that any money paid to the Board out of the collections of the market fee has also got to be expended in the very same area of the particular Market Committee. But such a strict construction from a practical point of view is not possible. The Board in the State is the Central Controlling and superintending authority over all the Market Committees, the primary function of which is to render service in the market. Parting with 30% income by a Market Committee in favour of the Board is not so excessive or unreasonable so as to warrant any interference with the law in this regard on the ground of violation of the principle of quid pro quo in the utilisation of the market fee realised from the traders in the market area. We would, however, like to emphasise that the Marketing Development Fund can only be expended for the purposes of the Market Committees in a general way, or to be more accurate, as far as practicable, for the purposes of the particular Market Committee which makes the contribution. We shall now read section 26 of the Act providing for purposes for which the Marketing Development Fund may be expended. It reads as follows: "The Marketing Development Fund shall be utilised for the following purposes: (i) better marketing of agricultural produce; (ii) marketing of agricultural produce on cooperative lines; (iii)collection and dissemination of market rates and news; (iv) grading and standardisation of agricultural produce; (v) general improvements in the markets or their respective notified market areas; (vi) maintenance of the office of the Board and construction and repair of its office buildings, rest house and staff quarters; 1255 (vii)giving aid to financially weak Committees in the shape of loans and grants; (viii)payment of salary, leave allowance, gratuity, compassionate allowance, compensation for, injuries or death resulting from accidents while on duty, medical aid, pension or provident fund to the persons employed by the Board and leave and pension contribution to Government servants on deputation; (ix) travelling and other allowances to the employees of the Board, its members and members of Advisory Committees; (x) propaganda, demonstration and publicity in favour of agricultural improvements; (xi) production and betterment of agricultural produce; (xii)meeting any legal expenses incurred by the Board; (xiii) imparting education in marketing or agriculture; (xiv)construction of godowns; (xv) loans and advances to the employees; (xvi)expenses incurred in auditing the accounts of the Board; and (xvii)with the previous sanction of the State Government, any other purpose which is calculated to promote the general interests of the Board and the Committee; or the national or public interest. On a parity of the reasoning which we have applied in the case of Market Committee Fund we may point out that the Market Development Fund constituted primarily and mainly out of the contributions by the Market Committees from realisations of market fees, can also be expended for the purposes of the market in the notified market area in relation to the transactions of purchase and sale of the agricultural produce and for no other general purpose or in the general interests of the agriculture or the agriculturists. On that basis we may, as at present advised hold as valid the purposes mentioned in clauses (i), (ii), (iii), (iv), first part of clause (v) clauses (vi), (vii), (viii), (ix), (xii), first part of clause (xiii), clauses (xiv), (xv) and (xvi). At the same time we hold that the Marketing Development Fund constituted out of the Market fees cannot be expended for the purposes mentioned in second part of clause (v), clauses (x), (xi), second part of clause (xiii) and clause (xvii). We do not propose to strike down these provisions as being constitutionally invalid as the purpose of the 1256 law will be served by restricting the operation of section 26 in the manner we have done. We now proceed to examine the decisions of the High Court in the light of the principles of law enunciated above. The first decision in the case of M/s Hanuman Dall & General Mills (supra) is the decision of a Division Bench of the High Court. It should be recalled that by this judgment delivered on 8 11 1974 the High Court maintained the raising of the market fee from Rs. 1.50 to Rs. 2/ in Haryana but struck down the rise from Rs. 1.50 to Rs. 2.25 in Punjab. In the cases before us a lot of new materials contained in new statements and charts were filed before us on either side. We shall examine only a few of those materials and that too very cursorily as in our view no useful purpose will be served, nor is it possible to do so for the first time in this Court, by their thorough examination. The very basis of the materials submitted on either side seems to be not well grounded on a correct appreciation of law. Too many disputes of facts have been raised before us. It is not possible to resolve all of them nor do we find that it will be useful to do that exercise. We shall presently show that even on the materials placed before the High Court and on the findings recorded by it, many of which do not seem to be in dispute, the requirement of law is not satisfied to the extent it is essential in a case of this nature. In the case of Hanuman Dall and General Mills (supra) the High Court examined many of the leading and important judgments of this Court which we have reviewed, earlier and also placed reliance upon an earlier Division Bench decision of the same High Court in Ram Sarup vs The Punjab State. In para 31 of the judgment at page 12 the view of the High Court "that the amount of fees so collected are not to be spent exclusively for rendering services to the payers of the fees but can also be utilised for carrying out the purposes or objects of the Act under which they are levied," is not quite correct. In the same paragraph the High Court felt constrained to add that the amount cannot, however, be utilised for purposes which have no connection with the main purposes of the Act for which fee is levied, nor can it be spent for carrying out the governmental functions of the State. If many of the purposes mentioned in the Act, as we have shown above, are outside the ambit of the service element and fall within the realm of the governmental functions, then it is plain that to say by generalisation that the fee money can be spent for the purposes or objects of the Act is not quite correct. The High Court has extracted section 1257 28 of the Act but has failed to scan the effect of the various purposes in some of the clauses. After referring to the income and expenditure statements of Market Committee, Hissar from 1969 70 to 1973 74 the conclusion of fact drawn at page 15 is that the market fee constitutes more than 80% of the income of the Market Committee and the amount spent on "works" is nearly one half of the total expenditure. The further finding is "the major item on which the amount has been spent under the head 'works ' consists of the amount deposited with the public works department, Hissar, as contribution for construction of village link roads." On that finding itself it is manifest that Public Works Department was carrying out the governmental functions of construction of roads including village link roads spread throughout the whole of the notified market area of Hissar. The said link roads could not be taken to be approach roads within the meaning of clause (viii) of section 28 of the Act as seems to be the view of the High Court. The error of law becomes writ large in the last sentence occurring in paragraph 34 of the judgment at page 15 which says: "In any case, the construction of roads within the notified market area is a work of Public importance and promotes the general interest of the committee and the notified market area which is one of the purposes enumerated in Cl. (xvii) of Section 26 of the Act. " The High Court further proceeds to say: "After giving my careful consideration, I am of the opinion that the expenditure on the construction of link roads for which amounts were deposited with the Public Works Department is fully justified as it is for the benefit of the growers, the licensed dealers and the general public and promotes the interests of the notified market area. " The High Court seems to be of the view that since transportation is very essential for the development of a market and to enable the growers of the agricultural produce to bring the same to the market, the construction of link roads becomes an essential purposes of the market committees. It may be so but the purpose cannot be allowed to be achieved at the cost of the market fee we realised from the dealers. The High Court point out that the money cannot be spent in construction of the government activities for providing main roads in the State. How, then, the Market Committees can be made to contribute a very big chunk of their market fee income in construction of the link roads throughout all villages ? To push the matter logically, 1258 if a link road is to be constructed from a village to the main road for enabling an agriculturist to transport his produce upto the main road then the Market Committee should be under an obligation to construct or at least to maintain the main road also in order to enable that agriculturist to react the market which may be at distance of say 20 miles from the link road. It is plain that construction of such link road is as much a part of the governmental activity as that of the main roads. It is interesting to find out from paragraph 36 of the judgment that the Market Committees were made to pay donations to educational institutions imparting general education. The Market Committee, Hissar, spent Rs. 1,07,794/ on the water supply scheme for a village. Even the High Court was constrained to disapprove of this. It also spent a sum of Rs. 6,00,000/ for the construction of a Panchayat Bhawan. Many other instances are mentioned in paragraph 37 of the judgment which show that the Market Committees were getting enormous income from market fees and they were made to squander away a good portion of that money unauthorisedly, although none of the purposes in itself was objectionable or bad. Rather, they were very laudable. But taking an overall view of the matter the High Court felt persuaded in the case of Haryana to uphold the maximum limit of Rs. 2/ by adding "no interference seems to be called for at this time. " In the case of Punjab, however, the allegation of the petitioners before the High Court was that the market committees were collecting lakhs of rupees every month and the Marketing Board was collecting crores of rupees. The Marketing Board was asked to contribute one crore of rupees to the Guru Gobind Singh Medical College which had been recently established at Faridkot. A good portion of the money was already paid and the High Court was constrained to observe that "the State Government shall be well advised to compensate the Agricultural Marketing Board and the Market Committees for the misutilisation of their funds for this unauthorised purposes". The High Court held at page 19, column 2: "In the historical background, set out above, I am convinced that the enhancement in the amount of fee from one rupee and fifty paise to two rupees and twenty five paise per one hundred rupees was not genuine and it was made with a view to enable the market committees and the Agricultural Marketing Board to reimburse themselves for the amounts which they were directed to contribute to Guru Govind Singh Medical College at Faridkot. The Market Committees were having enough income and could meet their legitimate requirements from the amounts of fees which were being realised prior to the enhancement. " 1259 The enhancement of fee from Re. 1/ to Rs. 1.50 was upheld but the further increase to Rs. 2.25 was knocked down. We may note here that in the batch of appeals we heard there was no appeal from the judgment of the High Court in the case of Hanuman Dall & General Mills. We may reasonably assume, therefore, that the dealers of Haryana were reconciled for payment of the market fees upto the maximum limit of two rupees per hundred rupees. In the case of Punjab, as we traced the history at the very outset, the maximum fixed later was Rs. 2.20 by Act 14 of 1975. But by telegraphic instructions issued by the Board the Market Committees were asked to charge Rs. 2/ only with effect from 23 8 1975. This was challenged before the High Court but unsuccessfully in the case of Kewal Krishan Puri and another vs The State of Punjab and others (supra). Civil Appeal 1083 of 1977 is from this judgment of the High Court. The Full Bench judgment in this case also suffers more or less from the same kind of error in the approach of the legal problem as is to be found in the earlier Division Bench decision. In paragraph 13 of the judgment at page 352 the High Court repelled the attack on clauses (x), (xi) and (xiv) of section 26 of the Act on the ground: "The broad object of the legislation like the present one is only to protect the producers of agricultural produce from being exploited by middlemen and profiteers and to enable them to secure a fair return of their produce. The Legislation like the present one has its root in the attempt on the part of the nation to provide a fair deal to the growers of crops and also to find a market for its sale at proper rates without reasonable chances of exploitation. If this object is kept in view, then the clauses of which the constitutionality has been challenged, would certainly fall within the ambit of Entry 28. Clauses (x), (xiii) and (xiv) would help the growers to make improvements in the production of agricultural produce with the result that their agricultural produce would find a better market resulting in getting them high price for their agricultural produce. " It is to be emphasised at this stage that the question is not of the legislative competence to enact those clauses, nor is there a question of the fee assuming the character of a tax and therefore, its imposition being beyond the legislative competence of the State Legislature. The precise and the short question is whether the Market Committees and the Board can be authorised to spend the amount realised by market fees, as fee and fee alone for achieving all the objects of the Act when such expenditure cannot be justified and sustained on the well known 1260 concept of fee as pointed out by this Court in several decisions. The impost must be correlated with the service to be rendered to the payers of the fees in the sense and to the extent we have pointed out above. Again the High Court fell into an error in paragraph 15 of the judgment when, while upholding the construction and repair of approach roads, culverts and bridges in the larger sense of the term it said: "If the approach roads, culverts or bridges are in such a bad shape that they would become hindrance in the mobility of the produce from one part of the notified market area to the principal market yard, then the worst sufferer would be the grower for whose benefit the Act has been enacted. " The Full Bench approved the view of the Division Bench in the earlier case as is apparent from paras 17 and 18 of the judgment at pages 352 and 353. We have said a bit earlier that the Market Committee and the Board laboured under a mistaken notion that they could spend the income from the market fee for all good purposes and objects of the Act in the general interest of agriculture and agriculturists in the village. We are going to extract some of the averments made in the affidavit of the Secretary of the Market Committee of Moga from the judgment of the High Court at pages 354 and 355: "Besides the above, the answering respondent has undertaken the cleaning of mandis, lining of village khals (water courses), link roads; constructions of culverts and bridges; supply of pesticides and spray pumps on subsidized basis as also the electrification of villages. All these activities are going to cost the answering respondent an amount of several lakhs of rupees." "Para 8 of the writ petition is denied. It is wrong to suggest that the Board and the answering respondent have already given Rs. 5 crores to the Markfed without charging any interest. The fact of the matter is that on account of the withdrawal of the Cotton Corporation of India from the various markets, the price of cotton came down suddenly. In order to provide and ensure a reasonable price to the farmer, the Government asked the Markfed to enter the market. For this purpose, the Board contributed some amount of money. So far as the answering respondent is concerned, it has not contributed any money at all. The answering respondent believes that the Board has contributed only an amount of Rs. 1.43 crores and not 5 crores." 1261 "It may, however, be submitted that the entire money collected by the Market Committees is being used for the purposes envisaged under the Act." "The Market Committees have to provide facilities as envisaged under the Act. The petitioners had asked for the copies of balance sheets. The balance sheets were originally prepared when the accounts of the Committees were being audited by "the Chartered Accountants. " Now, the accounts are being audited by the Examiner, Local Fund Accounts which is a Government Agency. The preparation of balance sheets involved unnecessary expenditure and wastage of time and energy. Consequently, the practice of preparing balance sheets was given up a few years back. " These paragraphs were placed before us also from the records of Civil Appeal 1083 of 1977. After quoting the various paragraphs from counter affidavit the High Court says in paragraph 20 of the judgment at page 355: "From the aforesaid specific averments made in the written statement, referred to above, it is clear that to carry out the purposes of the Act it had become necessary to enhance the rate of the market fee and such an enhancement stands fully justified. " When certain documents were placed before the High Court to show that the Board was indulging in activities which had no correlation to the object to be achieved under the Act and that the enhancement of the market fee could not be justified the High Court, in the first instance, did not feel inclined to put absolute reliance upon those documents as they were filed with the replication of the petitioners. But it did not stop there. It proceeded further at page 356, para 22 to say, on an impression of law which we have not countenanced, that: "So far as Annexures W 11 and W 12 are concerned, any expenditure incurred by the Marketing Board on the setting up of the rice shellers or ginning factories or by the Market Committees on the construction of the link roads would not be inconsistent with the provisions of the Act and the object to be achieved under the Act. The setting up of the rice shellers would be for the benefit of the producers and, as earlier observed, construction of the link roads also would be for their advantage. So far as Annexure W 10 1262 is concerned, there can be no gainsaying that giving of donation for the Chief Minister 's Flood Relief Fund by the Board or the Market Committee would not be justified as the same has no correlation with the object to be achieved under the Act and in case any respect, it would certainly be unauthorised and illegal. But, in the instant case, the petitioners have failed to show that any amount was contributed towards the Chief Minister 's Flood Relief Fund and that the enhancement in the fee had any correlation with such a contribution. In this view of the matter, on the basis of Annexures W 10, W 11 and W 12, the enhancement in the fee to be levied by the Committees cannot be struck down. " In several Civil Writ Petitions filed in the High Court by the dealers of the various Market Committees of Haryana the challenge, was to the raising of the rate of market fee from Rs. 2/ to Rs.3/ . The High Court rejected all those petitions by the judgment dated 30 8 1978 which is the subject matter of appeal in Civil Appeal No. 1708 of 1978 and the analogous ones. After referring to the earlier judgments of the Court this judgment of the Division Bench also proceeds on the same lines at it was bound to. To a large extent we are saved from the unnecessary botheration of examining the voluminously new materials placed before us in view of the counter filed on behalf of the Haryana Marketing Board in the High Court portions of which are extracted in the judgment. It will be useful to give the whole of the extract from the judgment of the High Court. It runs as follows: "It is well known to every one that the recent floods in Haryana were unprecedented and created havoc in the State Almost one third of Haryana was submerged under water damaging the standing crops and uprooting the inhabitants making them homeless. The State has to resort to quick measures, for removing the miseries of the people and to rehabilitate them . . . . . . . . . . . . . . . . . . . The projected income from market fee in the year 1977 78 was Rs. 9 crores. But due to the floods at the old rate of 2% it is expected to be Rs. 7.77 crores. The Committees will only be able to achieve the projected income of 1977 78 as anticipated in the beginning of the year only if the fee is charged at enhanced rate of 3%. Only with the projected income the Board will be able to provide the services envisaged by it to the farmers of the area. The Board allot 1263 ted works amounting to Rs. 8.53 crores in the year 1976 77, out of which the Board will be able to complete the development works worth Rs. 5.62 crores upto 31st March, 1978, leaving a spill over of Rs. 2.91 crores for the year 1978 79. In addition to this spill over, Board also anticipated to take new development works amounting to Rs. 3 crores during 1978 79. The projected income during the year 1978 79 taking into account the enhanced rate of market fee will be Rs. 6.20 crores whereas the expenditure will be to the tune of Rs. 8.97 crores including the development works, miscellaneous other services and the cost of establishment. The deficit of Rs. 2.77 crores had to be met by the Board by raising loan from other sources. Thus even this enhanced fee will not be sufficient to meet the expenditure which the Board proposes to incur for the purposes under the Act. Thus the enhancement of market fee from 2% to 3% is wholly reasonable and justified and has a reasonable correlation with the services rendered or to be rendered. " Quoting passages from the earlier judgments of the High Court, it upheld the levy of the fee @ Rs. 3/ per hundred rupees and dismissed all the writ petitions. The challenge by the dealers of the Moga Market Committee by Civil Writ Petition No. 2015 of 1978 filed in the High Court failed as per the judgment of the High Court delivered on 18 5 1978 wherein the Full Bench decision was followed. Special Leave Petition No. 2768 of 1978 has been filed from the said judgment. The purposes enumerated in the Full Bench decision and repeated in this judgment also for the purpose of justifying the increase in the rate of fee from Rs. 2/ to Rs. 3/ per hundred rupees are the stereo type ones including Rural Integrated Development Scheme, night shelter, link roads and bridges. Every body seems to have allowed himself to be carried too far by the sentiment of the laudable object of the Act of doing whatever is possible to do under it for the amelioration of the conditions and the uplift of the villagers and the agriculturists. Undoubtedly the Act is primarily meant for that purpose and to the extent it is permissible under the law to achieve that object of utilising the money collected by the market fee, it should be done. But if the law does not permit carrying on of the sentiment too far for achieving of all the laudable objects under the Act, then primarily it becomes the duty of the Court to allow the law to have an upper hand over the sentiment and not vice versa. We must not be misunderstood to say that we are against the sentiment expressed in the interests of the 1264 agriculturists. Nor are we opposed in the least to the achievement of all the laudable objects envisaged under the Act. Let them all be achieved by all means known to law by meeting the expenses after augmenting the public revenue or by diverting the expenditure from wasteful or unimportant channel to the more important one under the Act. But surely we cannot countenance the achievement of all those objects by utilising a good and substantial portion of the market fee collections when the utilisation goes against the concept of quid pro quo which is very essential in case of fees. As we have already stated Civil Appeal 1616 of 1978 arised from the order of the High Court dated 18 9 1978 dismissing the connected Writ Petition filed by a few hundred dealers of various Market Committees in the State of Punjab challenging the increase of the market fee from Rs. 2/ to Rs. 3/ . Before us in the Writ Petitions not only the increase of the rate from Rs. 2/ to Rs. 3/ has been challenged but the previous increases have also been challenged. For the reasons to be briefly stated hereinafter we do not feel persuaded to interfere with the charging of the market fee Rs. 2/ per hundred rupees by the various Market Committees in the States of Punjab and Haryana. But surely on the facts as they are, the increase of the rate from Rs. 2/ to Rs. 3/ is not justified in law by any of the Market Committees in either of the two States. Mr. Tarkunde drew our attention to the report of the Royal Commission submitted in 1928 and the recent Report of the National Commission on Agriculture. It has been emphasised in those reports that in order to make the marketing system efficient and useful link and village roads should be constructed providing transport facilities for the transport of the agricultural produce to the marketing centres. There cannot be any doubt that in any scheme of development of Agriculture and marketing in a wide sense, a chain of connections may be found between one activity or the other. It is not only in regard to agriculture but it is so in any other kind of production, distribution and marketing. Our attention was drawn also to the use of the word "secondary" or "indirect" in some of the decisions in relation to the element of quid pro quo. But in our opinion there is a misconception in understanding the true scope of the matter and not drawing the dividing line at the appropriate place for determining the real controversy. Examples of trust cases were given before us that control of the trustees is not for the personal benefit of the trustees but for the beneficiaries, although the liability to pay the fee is of the trustees. The misconception lies in the fact that the impost of fee is not a personal impost on any person in the sense that unconnected with any undertaking or property or the like, it is just an impost on his person. It is not so. When the trustee is charged fee for the benefit of the 1265 religious institutions and the beneficiaries it is a benefit to the trustee. Similarly, as pointed out in the Mining Act and the factory cases charge of fee from the mine owners in the area or the factory owners in the factory for the purpose of developing and protecting the mines and the factories is a service to the owners. If one were to push the example of a factory beyond the limit of the conception of fee, one could say that the fee charged from the factory owners can be utilised for pushing end augmenting the output of the raw materials required in the manufacturing process in the factory, it is also a benefit to the factory owner. Is it reasonably possible to travel as wide as that? Neither the Royal Commission nor the National Commission suggested as to how the integrated development of marketing and the agricultural produce is to be financed. They were not concerned with that aspect of the matter. None can have any objection to the carrying out of the integrated development but it must be carried out by legal means raising the finance in a way known to law. The improvements, checks, controls and regulations must be carried out in the market or in its vicinity. Much of the facilities provided in the market yards or around it will also be for the direct benefit of the producers. But then, being intimately connected with marketing operations the benefit to the producers must be deemed to be special or direct benefit to the traders also. Under the Marketing Rules the auction cannot be conducted by any person other than the person engaged by the Committee. [Rule 24(5)], and weighments and measurements of agricultural produce intended for sale are to be made through licensed weighments or measures in the principal or a sub market yard [vide Rule 28(2)]. Reading these Rules in the background of the recommendations of the Commissions, and even otherwise, it is plain they are meant for the protection of the agriculturists. But since they are intimately connected with the marketing operations, just like factory cases, they are also meant for the special benefit of the traders. The literal meaning of the phrase "quid pro quo" is "one for the other" meaning thereby "you charge the fee for the service." Service to the mining area, factory, market or marketing operations are services to the payer of the fee. Mr. P.N. Lekhi, learned counsel for the State of Haryana placed some new materials before us to show that big projects of development of marketing had been undertaken in India with the help of the World Bank loans. All very good, we wish God speed to all these projects. The only check which the law has to put is "please don 't spread your net too wide only on the traders. Keep it within bounds so long your levy has got the character of fee. You may raise funds by any other means known to law or to the economic world." 1266 Now we refer to some additional documents placed before us. But before we do so we repeat what we have said above that the materials placed on either side before us is so voluminous and cumbersome that no definite finding with any accuracy could be arrived at on that basis as there seems to be disputes in regard to the nature and accuracy of many of the figures either on the receipt side or on the expenditure side. We have, however, referred to some of the admitted facts even from the judgments of the High Court. We may refer to a few more. In the affidavit of Shri R. K. Singh, Director of Marketing, Punjab and Secretary of Punjab State Agricultural Board filed in the High Court giving rise to Civil Appeal No. 1083/77, which is not a new material in that sense. It was stated in paragraph 6: "It is submitted that respondent No. 3 is duty bound to bring about general improvement of a notified market area, production and betterment of agriculture etc. Under the Act and the answering respondent is duty bound to approve such expenditure under the Act. It is also submitted that electricity plays a major role in the production and betterment of agriculture and for the general improvement of area. In view of its importance respondent No. 3 sought and respondent No.2 approved the expenditure on the electrification of the villages situate within the jurisdiction of respondent No. 3. " In the Writ Petition, respondent No. 2 was the Marketing Board and respondent No. 3 was the concerned Marketing Committee. In the same case in the High Court additional affidavit was filed by Shri Tirath Singh, Chairman of the Punjab Board. It is stated in paragraph 7 that apart from development works in the budget estimates in the year 1975 76, there were other development projects to be taken in hand some of which were enumerated in that paragraph. We may take up only two or three items out of the same to show in contrast how one will be within the limits of law and the others will widely beyond it. Item No. (iii) reads as follows: "To provide Rest Houses, Cattle Sheds, Cart Sheds, Light and Water arrangements in all the market yards. " A good portion of these facilities will be utilised by the agriculturists who would be coming to the market yards for sale of their produce. Yet in the view we have expressed above it will be a service to the trader directly connected with the marketing operations. In contrast we quote items (x) and (xii): 1267 (x) Continuation of programme of link roads. (xii) Improvement of agricultural production by providing improved seeds, green manuring seeds, plant protection equipment insecticides and pesticides. " One has to stretch one 's imagination almost to a breaking point to say that the programme of link roads and improvement of agricultural say production by the means mentioned in item (xii) can all be carried out by the impost of fee in the market. In a new affidavit of Shri N. section Bakshi filed in this Court in Civil Appeal 1083 of 1977 it is stated in paragraph 6 that in the entire Khanna market notified area there is one principal yard; two sub yards and only two purchase centres and no weighing bridge or any weighing facilities has been provided by the Committee. It is stated in paragraph 7 that "amount of Rs. 3/ lacs lying with the Khanna Market Committee during March, 1978 in Banks was got deposited in the Government Treasury under the orders and directions of the Board. " These facts are disputed. But we are merely stating them for the future guidance of the authorities that they should proceed in the matter cautiously keeping in view the law laid down by this Court in earlier cases, such as, Salvation Army case, and in the light of this judgment. In the additional affidavit of Shri K. K. Puri it is stated that from the information gathered it was learnt that the Punjab Board had spent about a crore of rupees by way of subsidy @ 75% for the metallic bins for the use of the villagers for their domestic use; a crore for air spray; five crores to the Punjab State Electricity Board, one crore given to MARKFED, one and a half crore to Soil Conservation Department and yet nine crores were lying surplus with the various Market Committees. The figure may be exaggerated but are not quite groundless. We are merely quoting them for the future caution of the authorities concerned. Puri has further pointed out in paragraph 17 of his affidavit that in the Estimated Expenditure in the proposed Budget of the Moga Committee for the years 1976 77 and 1977 78 several lakhs of rupees were shown for insecticides and pesticides apart from other inadmissible expenses. We may again pin point the difference. If insecticides and pesticides are for use at the place where actually the marketing operations are carried on it would be a justifiable expenditure. But if they are meant to be supplied to the agriculturists for use at their village homes or in their fields surely they cannot be valid expenditure out of the collections of the market fee. Mr. Tarkunde filed an abstract of the statement of income from market fee and licence fee and expenditure incurred therefrom by 1268 the Market Committee, Hissar as worked out from Annexure R I to R V filed in the High Court. It would be seen from this abstract that in the year 1974 75 the income from market fee was Rs. 24,08,141/ and from licence fee about Rs. 6,000/ only. A sum of Rs. 7,89,670/ was contributed under section 27 of the Act to the Board and a sum of Rs. 14,73,732/ was spent on Works including link roads. Similar was the position in the year 1975 76. In 1976 77 income from licence fee was only Rs. 16,000/ and odd and incomes from market fee was Rs. 38,27,233 / . A big chunk to the tune of Rs. 12,19,383/ went as contribution to the Board and Rs. 24,47,408/ were spent on works including link roads. Similar abstracts were given in respect of other Market Committees showing exactly the same position. Abstracts were also given to us by Mr. Tarkunde showing the income of the Haryana Board by contribution made by the various Market Committees and the expenditure incurred therefrom. In the abstract statement figures of expenditure both of admissible and inadmissible items had been clubbed together. It is, therefore, not possible to get any correct picture from these abstracts. How admittedly the authorities concerned have travelled wide beyond limit for the application of the fee money will be apparent from the counter affidavit of the Haryana Board filed in the High Court giving rise to Civil Appeal 1700 of 1978. In paragraph 10(i) it is stated: "The construction of link roads within the notified market area is a work of public importance and promotes the general interest of the farmers, traders and the notified market area which is one of the purposes enumerated in clause XVII of section 28 of the Act." In para 10(ii) it is admitted: "Thus the enhancement of market fee from 2% to 3% is wholly reasonable and has co relation with the services rendered or to be rendered. 65% of its income had to be rightly deposited with the P.W.D. and the Government, as the Committee had got its link roads constructed through Government Agency and is still getting so constructed. " It is thus a clear admission that 65% of the income has gone by way of contribution to the P.W.D. fund for construction of the link roads. It is in substance a contribution to the Public Exchequer for helping the Government Agency in performing its governmental functions and duties. In no way such a contribution can be justified out of the mar 1269 ket fee income. From Annexure R II appended to the aforesaid affidavit of the Board it would be seen that in the year 1974 75 a sum of Rs. 1,07,338/ was given as aid to animal husbandry for the uplift of cattle wealth and its product. This illustrates to what extent the concept of fee in lieu of service has been stretched. A sum of Rs. 6,00,000/ and odd was spent for improving the quality of cotton seeds for seeds purposes. In a Gober Gas Plant Rs. 15,55,000/ were invested. This item was sought to be explained before us by Mr. Tarkunde that this expenditure was incurred with the help of the subsidy received from the State and the Central Governments. The scheme of the Gober Gas Plant was launched for the promotion of interest of market area. It is not explained as to how it was connected with the marketing operations in the area and how much was the subsidy and what portion of the amount was spent out of the market fee Income. Similarly in Annexure R III from the statement of income and expenditure of the Haryana Board for the year 1975 76 it would appear that a sum of Rs. 1,28,70,662/ was spent "on general improvement in M.C. and other notified area and construction of F.A.C.C." Apart from that the other items of expenditure are a sum of Rs. 20,00,000/ in purchase and acquisition of land for new mandies and Rs. 10,00,000/ and odd for purchase of land, construction of building for Board 's office and staff quarters in the mandies. Again in this year a sum of Rs. 95,00,000/ and odd is shown to have been spent on Gober Gas plant. It may be inclusive of the figure of the earlier year. Then from Annexure R IV, the statement for the year 1976 77, it will be found that a sum of rupees one crore was given as loan to Haryana Electricity Board. We have taken some of these items just by way of example to illustrate that the authorities took full liberty to treat the realisation from market fee as a general realisation of tax which they were free to spent in any manner they liked for the purposes of the Act, the development of the area, for giving a filling to agricultural production and so forth and so on. The sooner the authorities are made to realise the correct position in law the better it will be for all concerned. But taking a reasonable and practical view of the matter and on appreciation of the true picture of justifiable and legal expenditure in relation to the market fee income, even though it had to be done on the basis of some reasonable guess work, we are not inclined to disturb the raising of an imposition of the rate of market fee upto Rs. 2/ per hundred rupees by the various Market Committees and the Boards both in the State of Punjab and Haryana. After all, considerable development work seems to have been done by many Market 1270 Committees in their respective markets. The charging of fee @ Rs. 2/ , therefore, is justified and fit to be sustained. We accordingly do it. As pointed out earlier the dealers of Haryana did not feel aggrieved when the High Court maintained the raising of market fee to the extent of Rs. 2/ per hundred rupees. We are, however, not inclined to uphold the raising of the fee from Rs. 2/ to Rs. 3/ , as on the materials placed before us it is clear that this has been done chiefly because of the wrong impression of law that the amount of market fee can be spent for any development work in the notified market area and specially for the development of agriculture and the welfare of the agriculturists. On the basis of the facts and figures placed before us from the High Court records and also some new materials filed here we have come to the conclusion that there was no justification in raising the fee from Rs. 2/ to Rs. 3/ . The High Court was wrong in maintaining this rise on an erroneous view of the matter. We, therefore, allow the appeals and the writ Petitions to the extent and in the manner indicated above and direct the Market Committees and the State Marketing Boards not to realize market fee at the rate of Rs. 3/ per hundred rupees on the basis of their impugned decisions and actions which have been found to be invalid by us. We leave the parties to bear their own costs throughout Before we part with these cases we would like to observe that in future if the market fee is sought to be raised beyond the rate of Rs. 2/ per hundred rupees, proper budgets, estimates, balance sheets showing the balance of the money in hand and in deposit, the estimated income and expenditure, etc. should carefully be prepared in the light of this judgment. It may be, as was submitted before us, that it is not imperative either for the Market Committees or the Board to prepare balance sheets because their accounts are audited by government auditors but for the purposes of raising the market fee any further, the balance sheets will give a true picture of the position also with the budgets and estimates. Then, and then only there may be a legal justification for raising the rate of the market fee further to a reasonable extent. On drawing of the correct balance sheets and framing of the correct estimates and budgets the authorities as also the State Government will be able to know the correct position and to decide reasonably as to what extent the raising of the market fee can be justified taking on overall picture of the matter and keeping in view the reason behind the restrictions of sales tax law concerning the transactions of food grains and the other agricultural produce. N.V.K. Appeals and petitions allowed.

Punjab Agricultural Produce Markets Act, 1961 Ss. 23, 26 and 28 & Punjab Agricultural Produce (General) Rules, R 29 Marketing Development Fund & Marketing Committee Fund Utilisation of market fees Validity of purposes enumerated in clauses of Ss. 26 and 28 examined The Punjab Agricultural Produce Markets Act, 1961 which was passed by the composite State of Punjab is an Act for the better regulation of the purchase,sale, storage and processing of agricultural produce and the establishment of markets for agricultural produce in the State. Section 3 envisages the establishment of the State Agricultural Marketing Board for the entire State and it is provided in sub sec (9) that "The Board shall exercise superintendence and control over. the committees" Section 6(1 ) provides for "declaration of notified market area" and the State Government is empowered to declare the area notified under section S or any portion thereof to be a notified market area for the purpose of the Act in respect of the agricultural produce notified under section 5 or any part thereof. The market areas and market yards were declared. putting restriction on the traders to carry on their trade under a licence granted by the various Markets Committees established and constituted within the specified boundaries or areas. After the declaration of the notified market area no person can establish or continue any place for the purchase, sale, storage and processing of the agricultural produce except under a licence granted in accordance with the provisions of the Act, the Rules and the Bye laws. Section 23 empowers the committee to levy the fees subject to such rules as may be made by the State Government in this behalf on the agricultural produce bought or sold by licensees in the notified market area at a certain percentage. Under section 27(1), all Moneys received by a Committee shall be paid into a fund to be called the Market Committee Fund and all expenditure incurred shall be defrayed out of such fund, while under section 25 all receipts of the Board are to be credited into a fund to be called the Marketing Development Fund and the purposes for which it may be expended are enumerated in section 26 viz. better marketing of agricultural produce on co operative lines, collection and dissemination of market rates and news. grading and standardisation of agricultural produce etc. Section 28 catalogues the purposes for which the Marketing Committee Fund may be utilised viz. acquisition of sites for the market. maintenance and improvement of the market, construction and repair of buildings which are necessary for the purpose of the market etc. In the composite State of Punjab and even after the bifurcation of the State for about a period of three years the maximum rate of market fee which could 1218 be levied by the various market communities under section 23 was 50 paise for every one hundred rupees. the fee was thereafter raised from time to time. A number of writ petitions were Filed in the High Court challenging the power of the Board to incease the levy of fee. All the writ petitions were heard together and the increase Ind levy of fee upto Rs. 2/ by the various Market Committees in the State of Haryana was upheld and the writ petition of the Haryana dealers were dismissed while those of the Punjab dealers were allowed and the increase of u a e brought about by Act 13 of 1974 to the extent of Rs, 2.25 Was struck down. [M/s. Hanuman Dall & General Mills, Hisar vs State of Haryana & others In Punjab, by amendment Act 14 of 1975, section 23 of the Act was again amended authorising the imposition of market fee at a rate not exceeding Rs. 2.20 per hundred rupee only, and this increase in the rates of fee was again challenged in the High Court and a Full Bench upheld the increase. [Kewai Puri & Anr. vs State of Punjab & Ors., AIR 1977 P & H 347]. This view was challenged in the appeal to this Court. Both in the State of Punjab and the State of Haryana the rate of market fee was further raised from Rs. 2/ to Rs. 3/ . It was unsuccessfully challenged in the High Court by the dealers of each of the States, who thereafter preferred appeals to this Court against the Judgment of the High Court and also challenged the increases in fee, in writ petitions in this Court. In the appeals and writ petitions it was contended that the levy of the market fee realised from the buyers under section 23 of the Act could not be correlated I with the service to be rendered to the payers of the fees, and therefore cannot be justified and sustained on the well known concept of fee as pointed out by this Court in several decisions, and that the items of expenditure authorised and enumerated in sections 26 and 28 of the Act, go beyond the scope of the purpose of the utilisation of the market fees. On the question of the validity of the fixation of market fee under section 23 of the Act from time to time and the scope and the purpose of the utilisation of such fees: ^ HELD: 1. The impost of fee and the liability to pay it is on a particular individual or a class of individuals. They are under the obligation to submit accounts, returns or the like to The authorities concerned in cases where quantification of the amount of fee depends upon the same. I hey have to undergo the botherations and harassmentss, sometimes justifiably and sometimes even unjustifiably, in the process of discharging their liability to pay the fee. The authorities levying the fee deal with them and realise the fee from them. By operation of the economic laws in certain kinds of imposition of fee the burden may be passed on to different other persons one after the other. [1229H 1230B] In the instant case, the Market Committees and the Market Board assumed to themselves the liberty of utilising and spending the realisations from market fees to a considerable extent. as if it was a tax, although in reality it was not so. [1240D] 2. Rendering some service, however remote the service may be, cannot strictly speaking satisfy the element of quid pro required to be established in cases 1219 of the impost of fee. Registration fee, however has to be taken to stand on a different footing altogether. In the case of such a fee the test of quid pro quo is not to be satisfied with such direct close or proximate relationship as in the case of many other fees. By and large registration fee is charged as a regulatory measure. [1241B] 3. This Court in a large number of cases had the occasion to examine the nature of fee and tax and from a conspectus of the various authorities the following, principles for satisfying the test for a valid levy of market fees on the agricultural produce bought or sold by licences in a notified market area are deducible : (i) That the amount of fee realised must be earmarked for rendering services to the licencees in the notified market area and a good and substantial portion of it must be shown to be expended for this purpose. [1243H] (ii) That the services rendered to the licensees must be in relation to the transaction of purchase or sale of the agricultural produce. [1244B] (iii) That while rendering services in the market area for the purpose of facilitating the transactions of purchase and sale with a view to achieve the objects of the marketing legislation it is not necessary to confer the whole of the benefit on The licensees but some special benefits must be conferred on them which `have a direct, close and reasonable correlation between the licensees and the transactions. [1244C] (iv) That while conferring some special benefits on the licensees it is permissible to render such service in the market which may be in the general interest of all concerned with the transaction taking place in the market. [1244D] (v) That spending the amount of market fees for the purpose of augmenting the agricultural produce. its facility of transport in villages. and to provide other facilities meant mainly or exclusively for the benefit of agriculturist is not permissible on the ground that such in services in the long run go to increase the volume of transaction, in the market ultimately benefiting the traders also. Such an indirect and remote benefit to the traders is in no sense a special benefit to them. [1244E F] (vi) That the element of quid pro quo may not be possible, or even necessary, to be established with arithmetical exactitude but even broadly and reasonably i; must be established by the authorities who charge the fees that the amount is being spent for rendering services to these on whom falls the burden of the fee. [1244G] (vii) At least a good and substantial portion of the amount collected on account of fees, may be in the neighbourhood of two thirds or three fourths, must be shown with reasonable certainty as being spent for rendering services of the kind mentioned above. [1244 H] The Commissioner Hindu Religious Endowments, Madras vs Sri Lakshmindra Thirtha Swamiar of Sri Shirur Mutt; , ; Matthews vs Chicorv Marketing Board, ; ; Attorney General for British Columbia & Esquimalt & Nanaimo Railway Co. & Ors., (1950) Appeal Cases. 87: H. H. 1220 Sudhundra Thirtha Swamiar vs Commissioner for Hindu Religious & Charitable Endowment, Mysore [1963 Suppl. 2 SCR 302; Mahant Sri Jagannath Ramanuj Das & Anr. vs The State of Orissa & Anr., ; ; Ratilal Panachand Gandhi vs The State of Bombay and ors. [1954] SCR 1055; The Hingir Rampur Coal Co. Ltd. & ors. vs The State of Orissa & Ors., ; ; Parton vs Milk Board (Victoria) ; ; Corporation of Calcutta & Anr. vs Liberty. Cinema ; ; Har Shankar & ors. vs The Dy. Excise & Taxation Commr. & ors. ; ; Nagar Mahapalika Varanasi vs Durga Das Bhattacharya & ors.; , ; The Delhi Cloth & General Mills Co. Ltd. vs Chief Commissioner Delhi & Ors.,1970] 2 SCR 348; Indian Mica & Micanite Industries Ltd. v State of Bihar & Ors. ; Secretary Government of Madras Home Department & Anr. vs Zenith Lamp & Electrical Ltd. ; ; State of Maharashtra & Ors. vs The Salvation Army, Western India Territory,[1975] 3 SCR 475; Govt. of Andhra Pradesh & Anr. vs Hindustan Machine Tools Ltd. [1975] Suppl. SCR 394; The Municipal Council Madurai vs R. Narayanan etc.; , ; The Chief Commissioner Delhi and Anr. vs The Delhi Cloth & General Mills Co. Ltd. & Anr. ; ; P P. Kutti Keya & Ors. vs The State of Madras & Ors., AIR 1954 Madras, 621; MCVS Arunachala Nadar etc. vs The State of Madras & Ors., [1959] Suppl. 1 SCR 92; Mohmmad Hussain Gulam & Anr. vs State of Bombay & Ors. , ; ;Lakhan Lal & Ors. etc. vs The State of Bihar & Ors., ; ; referred to. (i) A dispute arose between the parties as to whether the licence is granted for the whole of the area or for particular places therein. On examining Form in the Rules meant for grant of licence under section 10, it is found that the licence is granted for one or more places of business specified in col. 6 situated in a particular notified market area named at the top of the licence. There will be no sense in specifying the place of business in the licence if the licensee is to be permitted to establish his place of business any where in a notified market area which is too big and extensive for the control and supervision of a particular Market Committee. Market yards are declared under section 7. For each notified market area there can be one principal market yard and one or more sub market yards as may be necessary. The marginal note of sec 8 is, "No private market to be opened in or near places declared to be markets." [1246D E] (ii) There is no special provision in this statute for an establishment of markets or markets proper as per the definition contained in cl. (i) and (k) of section 2 of the Act, it is reasonable to assume that the intention of the legislature is to constitute the market yards as the market proper and ordinarily and generally the market would be the same but may include some other places where transactions of purchase of agricultural produce by the traders from the producers has been allowed in order to avoid rush in the precincts of the market proper. But one thing is certain that the whole of the market area in no sense can be equated with market or market proper. Nobody can be ' allowed to establish a purchasing centre of his own at any place he likes in the market area without there being such a permission or authority from The Market Committee. After all the whole object of the Act is the supervision and control cf the transactions of purchase by the traders from the agriculturists in order to prevent exploitation of the latter by the former. [1240H 1247A] 1221 5. The whole object of the Act is the supervision and control of the transactions of purchase by the traders from the agriculturists in order to prevent exploitation of the latter by the former. The supervision and control can be effective only in specified localities and places and not throughout the extensive market area. [1247B] 6. Rule 24(1) in both the States framed under the Act provides that "all agricultural produce brought into the market for sale shall be sold by open auction in the principal or sub market yard", which indicates that market is generally the principal and sub markets yards. The benefit of market fee, therefore, has to be correlated with the transactions taking place at the specified place in the market area and not in the whole of the area.[1247D] 7. The duties and powers of a market committee are enumerated in section 13 and this indicates that the Committee is primarily concerned with the establishing of a market in the notified area and with providing facilities in the market for persons visiting it and in connection with the transactions taking place there. [1247F] 8. Reading section 23 along with r. 29 it would be noticed that the power of the Committee to levy fees is subject to the Rules as may be made by the State Government. The fee is levied on ad valorem basis at a rate which cannot exceed the maximum mentioned in section 23 by the legislature. But the power to fix the rate from time to time within the maximum limit has been conferred on the Board and the Committee is merely bound to follow it. [1248G H] 9. Section 23 in express language controls the power of the Committee to levy fees subject to the rules. The power given to the Board to fix the rate of market fees from time to time under rule 29 is not ultra vires the provisions of the Act, as sub sec.(a) of section 3 confers power on the Board to exercise superintendence and control over the committees, which power, in the context and the scheme of the marketing law, will take within its ambit the power conferred on the Board under rule 29(1). [1249C] State of Punjab & Anr. vs Hari Krishan Sharma, ; ; distinguished 10. The fee levied is not on the agricultural produce in the sense of imposing any kind of tax or duty on the agricultural produce. Nor is it a tax on the transaction of purchase or sale. The levy is an impost on the buyer of the agricultural produce in the market in relation to transactions of his purchase. The agriculturists are not required to share any portion of the burden of this fee. In case the buyer is not a licensee then the responsibility of paying the fees is of the seller who may realise the same from the buyer. But such a contingency cannot arise in respect of the transactions of sale by an agriculturist of his agricultural produce in the market to a dealer who must be a licensee. Probably such an alternative provision was meant to be made for outside buyers who are not licensees when they buy the agricultural produce from or through the licensees.[1249D E] 11. Every Market Committee is obliged under sub sec. (2) (a) of section 27 to pay out of its funds to the Marketing Board as contribution such percentage of its income derived from licence fee, market fee and fines levied by the 1222 courts as specified in sub cl. (i) and (ii). The purpose of this contribution as mentioned in sub sec.(2) (a) is to enable the Board to defray expenses of the office, establishment of the Board and such other expenses incurred by it in the interest of the Committees in general. The income of almost all the Market Committees were several lakhs of rupees per year and, therefore, each is required to pay 30 per centum of its income to the Board by virtue of the amendment brought about by Punjab Act 4 of 1978. Under section 25 all receipts of the Board are to be credited into a fund to be called the Marketing Development Fund. Purposes for which the Marketing Development Fund may be expended are enumerated in section 26 and the purposes for which the Market Committee Funds may be expended are catalogued in section 28[1250A C] 12. No serious objection to the items of expenditure mentioned in clauses (xii), (xiv), (xv) and (xvi) can be taken. Clause (x) and clause (xi) cannot form the items of expenditure of the market fees. The whole of the State is divided into market areas. The propaganda in favour of agricultural improvement and expenditure for production and betterment of agricultural produce will be in the general interest of agriculture in the market area. So long as the concept of fee remains distinct and limited in contrast to tax such expenditure out of the market fee cannot be countenanced in law. [1252F G] 13. The first part of cl. (xiii) may be justified in the sense of imparting education in marketing to the staff of the Market Committee. But imparting education in agriculture in general cannot be correlated with the market fee. [1252H] 14. How ill conceived the second part of clause (xvii) is ? Is it permissible to spend the market fees realised from the traders for any purpose calculated to promote the national or public interest ? Obviously not. No market Committee can be permitted to utilise the fund for an ulterior purpose howsoever benevolent, laudable and charitable the object may be. The whole concept of fee will collapse if the amount realised by market fees could be permitted to be spent in this fashion. [1253A B] Technically and legally, one may not have any objection to the expenditure of such money for the purposes mentioned in clauses (x), (xi), (xiii) and (xvii). [1253D] 15. It is not necessary to strike down any clauses of section 28 as being unconstitutional merely on the ground that the expenditure authorised therein goes beyond the scope of the purpose of the utilisation of the market fees. The authorities have to bear this in mind and on a proper occasion the matter will have to be dealt with by courts in the light of this Judgment where a concrete case comes of raising of a loan, spending the money so raised which cannot be reasonably connected with the purposes for which the market fee can be spent, as to whether such a loan can be repaid or interest on it can be paid out of the realisations of the market fees. [1253G] 16. The Board in the State is the Central Controlling and superintending authority over all the Market Committees, the primary function of which is to render service in the market. Parting with 30% income by a Market Committee in favour of the Board is not so excessive or unreasonable so as to warrant any interference with the law in this regard on the ground of violation of the principle of quid pro quo in the utilisation of the market fee realised 1223 from the traders in the market area. Emphasised that the Marketing Development Fund can only be expended for the purposes of the Market Committees in a general way, or to be more accurate, as far as practicable, for the purposes of the particular Market Committee which makes the contribution. [1254C D] 17. Section 26 of the Act provides for purposes for which the Marketing Development Fund may be expended. The Marketing Development Fund constituted primarily and mainly out of the contributions by the Market Committees from realisation of market fee can also be expended for the purposes of the market in the notified market area in relation to the transactions of purchase and sale of agricultural produce and for no other general purpose or in the general interest of the agriculture or the agriculturists. The purposes mentioned in clauses (i), (ii), (iii), (iv), first part of clause (v), clauses (vi), (vii), (viii), (ix), (xii), first part of clause (xiii), clauses (xiv), (xv) and (xvi) held valid. The Marketing Development Fund constituted out of the Market fees cannot be expended for the purposes mentioned in second part of clause (v), clauses (x), (xi), second part of clause (xiii) and clause (xvii). As the purpose of the law will be served by restricting the operation of section 26, it is not necessary to strike down those provisions as being constitutionally invalid. [1254E, 1255F 1256A] 18. The High Court has extracted section 28 of the Act but has failed to scan the effect of the various purposes in some of the clauses. [1256H 1257A] 19. The High Court seems to be of the view that since transportation is very essential for the development of a market and to enable the growers of the agricultural produce to bring the same to the market, the construction of link roads becomes an essential purpose of the market committees. It may be so but the purpose cannot be allowed to be achieved at the cost of the market fee realised from the dealers. [1257G] 20. The impost must be correlated with the service to be rendered to the payers of the fees in the sense and to the extent pointed out. [1260A] 21. Everybody seems to have allowed himself to be carried too far by the sentiment of the laudable object of the Act of doing whatever is possible to do under it for the amelioration of the conditions and the uplift of the villagers and the agriculturists. Undoubtedly the Act is primarily meant for that purpose and to the extent it is permissible under the law to achieve that object of utilising the money collected by the market fee, it should be done. But if the law does not permit carrying on the sentiment too far for achieving of all the laudable objects under the Act, then primarily it becomes the duty of the Court to allow the law to have an upper hand over the sentiment and not vice versa. [1263G H] 22. If insecticides and pesticides are for use at the place where actually the marketing operations are carried on it would be a justifiable expenditure. But if they are meant to be supplied to the agriculturists for use at their village homes or in their fields surely they cannot be valid expenditure out of the collections of the market fee. [1267G H] In the instant cases the authorities took full liberty to treat the realisation from market fee as a general realisation of tax which they were free to spend in any manner they liked for the purposes of the Act, the development of the area, for giving a fillip to agricultural production and so forth and so on. The 1224 sooner the authorities are made to realise the correct position in law the better it will be for all concerned. [1269F] 23. Taking a reasonable and practical view of the matter and on appreciation of the true picture of justifiable and legal expenditure in relation to the market fee income, even though it had to be done on the basis of some reason able guess work, the court did not disturb the raising of an imposition of the rate of market fee upto Rs. 2/ per hundred by the various Market Committees and the Boards both in the State of Punjab and Haryana. After all, considerable development work seems to have been done by many Market Committees in their respective markets. The charging of fee @ Rs. 2/ therefore, is justified and fit to be sustained. [1269G 1270A] 24. The dealers of Haryana did not feel aggrieved when the High Court maintained the raising of the market fee to the extent of Rs. 2/ per hundred rupees. The court did not uphold the raising of the fee from Rs.2/ to Rs. 3/ as on the materials placed before it, it is clear that this has been done chiefly because of the wrong impression of law that the amount of market fee can be spent for any development work in the notified market area and especially for the development of agriculture and the welfare of the agriculturists. The High Court was wrong in maintaining this use on an erroneous view of the matter.[1270B C] 25. In future if the market fee is sought to be raised beyond the rate of Rs.2/ per hundred rupees, proper budgets, estimates, balance sheets showing the balance of the money in hand and in deposit, the estimated income and expenditure, etc. should carefully be prepared. On drawing the correct balance sheets and framing of the correct estimates and budgets the authorities as also the State Government will be able to know the correct position and to decide reasonably as to what extent the raising of the market fee can be justified taking an over all picture of the matter and keeping in view the reason behind the restrictions of sales tax laws concerning the transactions of foodgrains and the other agricultural produce. Then, and then only, there may be a legal justification for raising the rate of the market fee further to a reasonable extent.[1270E G]

Civil Appeal No. 2533 of 1969. Appeal by special leave from the Award dated the 25th June, 1969 of the Central Government Industrial Tribunal, Calcutta, in Reference No. 35 of 1968. M. K. Ramamurthi, Ramesh Pathak, Vineet Kumar for the Appellants. G. P. Pai, o. c. Mathur, D. N. Mishra and J. B. Dadachanji & Co. for Respondent. The Judgment of the Court was delivered by BHAGWATI, J. This appeal by special leave is directed against an award made by the Industrial Tribunal, Calcutta in a reference between the National and Grindlays Bank Ltd. (hereinafter referred to as the Bank) and its workmen represented by the All India National & Grindlays Bank Employees Federation. The Bank is a banking company within the meaning of section 5 of the Banking Companies Act, 1949 and has its Head office in London and branch offices in different parts of the world, including India. The principal office of the Bank in India is situate in Calcutta. The Bank maintains its accounts according to the calender year and it brings out not only a consolidated balance sheet and profit and loss account for its world business, but also a separate balance sheet and profit and loss account for its Indian business. There was an industrial dispute between the Bank and its workmen in regard to bonus for the years 1956 to 1964 and as a result of negotiations, this industrial dispute was settled between the parties on an ad hoc basis under a Memorandum of Settlement dated 28th r. December, 1965. The material terms of the settlement were: "1. The Bank will pay and the workmen and non work men staff will receive a sum of Rs. 27 lakhs (Rupees twenty seven lakhs only) in full and final settlement of all bonus claims covering the periods from 1st January 1956 to 31st December 1964, including any claims relating to Centenary Bonus. 134 2. The above sum of Rs. 27 lakhs will be allocated as to one third thereof to Award staff only and as to the remaining two thirds to both the Award and non Award staff, in both cases based on the basic salary paid over the period, namely, 1st January, 1956 to 31st December, 1964, and unrelated to any particular year. The parties agree that this Settlement shall not be taken as the basis or govern the principle for this determination of bonus in future, but nevertheless this Settlement shall be final and binding on the parties as regards bonus claims for the years 1956 to 1964 (both inclusive) and any claim relating to Centenary Bonus, as also regards qualifications for eligibility and procedures as set out above. It may be noted that this Settlement was arrived at between the parties after the came into force on 25th September, 1965. This Act provided a statutory formula for computation and payment of bonus and it was admittedly applicable in respect of the accounting year 1964, but no separate computation of bonus for that year was made in accordance with this statutory formula and it was settled on an ad hoc basis as a part of an omnibus settlement for the accounting years 1956 to 1964. So far as the claim for bonus for the accounting year 1965 was concerned, computation was made in accordance with the statutory formula provided in the and the maximum 20% of the salary or wage earned during that accounting year was paid by way of bonus to the workmen. The claim for bonus for the accounting year 1966, however, could not be settled between the parties and, though the Bank paid , 18% of the wage or salary earned by the workmen during that accounting year as bonus, the workmen were not satisfied and the industrial dispute arising from their claim had to be referred for adjudication. There were different aspects of this industrial dispute which required consideration and the Central Government, therefore, formulated each aspect as a separate question and referred those questions for adjudication to the Industrial Tribunal, Calcutta. The Industrial Tribunal made an award holding that, on an application of the statutory formula, the amount available for payment of bonus was Rs. 22.17 lakhs and The workmen were, therefore, entitled to a little over 9% of their salary or wage as bonus, but since they had already been paid by the Bank bonus at the rate of 18% of their salary or wage, which was much more than what they were entitled to receive, nothing further remained to . be paid and they were not entitled to any relief. This award is impugned in the present appeal brought by the workmen with special leave. There are only certain items in the computation of bonus which are now in dispute in the appeal before us and we shall confine our attention to them. But before we deal specifically with these items, it could be convenient to refer to some of the relevant provisions of the . We will refer only to those provisions which have a bearing on the items in dispute between the parties. Section 2 is the definition section and cl. (13) of that section defines 'employees 135 to mean any person employed on a salary or wage not exceeding one thousand and six hundred rupees per mensem in any industry to do any skilled or unskilled manual, supervisory, managerial, administrative, technical or clerical work for hire or reward. The mode of computation of gross profits in the case of a banking company is laid down in section 4, cl. (a) which provides that the gross profit shall be calculated in the manner specified in the First Schedule. The First Schedule sets out in items 2, 3 and 4 various amounts which are to be added and in item 6, various amounts which are to be deducted from the net profit as shown in the profit and loss account. We are concerned in this is appeal only with items 2, 3(a) and 6(e) which read as follows: Item No. Particulars Amount of Amount of Remarks sub items main items 2. Add back provision for (a) Bonus to employees (b) Depreciation (c) Development Rebate Reserve. (d) Any other reserves Total of Item No. 2 Rs. 3. Add back also (a) Bonus paid to employees in respect of previous accounting years. 6 Deduct: (e)In the case of foreign ; banking companies proportionate administrative (overhead) expenses of Head, office allocable to Indian business The concept of 'available surplus ' is defined in section 2, cl. (6) to mean available surplus computed under section 5 and that section lays down that the available surplus in respect of any accounting year shall be the gross profit of that year after deducting therefrom the sums referred to in s 6 Clauses (a) and (d) of section 6 provide that the following sums shall be deducted from the gross profits as prior charge, namely: "(a) any amount by way of the depreciation admissible in accordance with the provisions of sub section (1) of section 32 pf the Income Tax Act, or in accordance with the provisions of the agricultural income tax law, as the case may be:" "(d) such further sums as are specified in respect of the employer in the Third schedule The Third Schedule is rather material as it bears on one item in dispute between the parties. Clauses (ii) and (iii) of the proviso to item 2 . in the Third Schedule enact that in case of a banking company which is a foreign company within the meaning of section 591 of the Companies 10 390SCI/76 Bank in the present case being such banking company the amount to be deducted shall be the aggregate of "(ii) 7.5 per cent. Of such amount as bears the same pro r portion to its total paid up equity share capital as its total working funds in India bear to its total world working funds; (iii) 5 per cent of such amount as bears the same proportion to its total disclosed reserves as its total working funds r in India bear to its total world working funds;" Then we come to the concept of allocable surplus which is defined in section 2, cl. (4) and under that clause, 60% of the available surplus is to be taken to be the allocable surplus and it is this allocable surplus which is to be distributed by way, of bonus to the workmen, subject to a limit of 20 per cent. Of the total salary or wage of the employees employed in the establishment. 10, sub sec. (1) provides for payment of a minimum bonus of 4 per cent. Of the salary or wage earned by the employees, irrespective whether or not there are profits in the accounting year, and sub sec. (1) of section 11 lays down that where the allocable surplus exceeds the amount of minimum bonus payable under section 10, sub section (1) "the employer shall, in lieu of such minimum bonus, be bound to pay to every employee in the accounting year bonus which shall be an amount in proportion to the salary or wage earned by the employee during the accounting year subject to a maximum of twenty per cent of such salary or wage". 15 is the next material section and it provides, inter alia: " (1) Where for any accounting year the allocable surplus exceeds the amount of maximum bonus payable to the employees in the establishment under sec. 11, then, the excess shall, subject to a limit of twenty per cent, of the total salary or wage of the employees employed in the establishment in that accounting year, be carried forward for being set on in the l succeeding accounting year and so on up to and inclusive or the fourth accounting year to be utilised for the purpose of payment of bonus in the manner illustrated in the Fourth t Schedule. (2) Where for any accounting year, there is no available surplus or the allocable surplus in respect of that year falls short of the amount of minimum bonus payable to the employees in the establishment under sec. 10, and there is no amount or sufficient amount carried forward and set on under sub sec. (1) which could be utilised for the purpose of payment of the minimum bonus, then, such minimum amount or the deficiency, as the case may be, shall be carried forward for being set off in the succeeding accounting year and so on up to and inclusive of the fourth accounting year in the manner illustrated in the Fourth Schedule. (4) Where in any accounting year any amount has been carried forward and set on or set off under this section, then, in calculating bonus for the succeeding accounting year, the ` u, 137 amount of set on or set off carried forward from the earliest A accounting year shall first be taken into account. ' Sec. 34, sub section (3) enables employees employed in any establishment or class of establishments to enter into agreement with their employer for grant of bonus under a formula which is different from that under the , so long as it does not deprive them of the minimum bonus payable under section 10, sub sec. It is in the light of these provisions that we have to consider the various points arising For determination in the appeal. We will first take us for consideration question No. 2 referred to the Industrial Tribunal. That question` raises the issue whether any amount is liable to be carried forward for being set on in the accounting year 1956 and if so, what amount. The claim of the workmen was that there was excess of allocable surplus over the amount of maxi mum bonus in both accounting years 1964 and 1965 and the excess in respect of both these years was, by reason of section 15, sub section (1), liable to be carried forward for being set on in the succeeding accounting year 1966. Now, so far as the claim in respect of the accounting year 1965 was concerned, the amount to be carried forward and set on was settled at the figure of Rs. 10.23 lacs under an agreement arrived at between the parties and no dispute, therefore, survived in respect of that claim. But the claim in respect of the accounting year 1964 was strongly resisted on behalf of the Bank and a preliminary objection was raised that the question whether any amount was liable to be carried forward and set on out of the profits of the accounting year 1964 did not form the subject matter of the reference and hence this Court, in appeal from the Industrial Tribunal, had no jurisdiction to adjudicate upon this question. We do not think there is any substance in this preliminary objection. Question No. 2, referred to the Industrial Tribunal, in terms raises the issue "whether any amount is to be carried forward for being set on in the accounting year 1966", and this issue is wide enough to cover the question in regard to carry forward and set on of an amount out of the profits of the accounting year 1964. The Bank then contended that since the bonus payable for the accounting year 1964 was settled on an ad hoc basis, it was not possible to say that the allocable surplus exceeded the maximum bonus payable for that year and hence there could be no question of any excess to be carried forward and set on in the succeeding year. There is great force in this contention. Sec. 15, sub section (1) provides for carry forward and set on and, on its plain terms, it comes into operation only when, in a given accounting year, the allocable surplus exceeds the maximum bonus pay able under the Act, so that after payment of the maximum bonus there is surplus left which can be carried forward and set on, subject, of course, to the limit of 20 per cent. Of the total salary or wage. It is clear from the scheme of the Act and the context in which this sub section occurs, following closely upon sections 4 to 10, that the basic condition for the applicability of this sub section is that bonus is computed in accordance with the statutory formula provided in the preceding sections of the Act and as a result of such computation, it is found that the allocable surplus is more than sufficient . to cover the maximum bonus payable under the Act and where such is the case, the sub section provides that the excess over the amount of the maximum bonus 138 shall, to the extent of 20 per cent. Of the total wage or salary, be carried forward and set on in the succeeding year. This sub section can have no application where no computation is made under the Act and bonus is paid, not in accordance with the statutory formula, but on an ad hoc basis. Then it is not possible to say what was really the bonus payable under the Act. It may be less or more than the bonus in fact paid. That inquiry being rendered irrelevant by the ad hoc settlement, there can be no question of carry forward and set on of any amount, unless specifically agreed upon as part of the settlement. The workmen in the present case were, therefore, not entitled to contend that, though the claim for bonus for the accounting year 1964 was settled on an ad hoc without making computation under the provisions of the Act, such computation must now be made, not for the purpose of determining the bonus payable to them, which is the only purpose for which such computation is contemplated to be made, but for the purpose of determining whether there is any amount liable to be carried forward and set on. The claim of the workmen for carry forward and set on in respect of the accounting year 1964 must accordingly stand rejected. We now, proceed to consider the items in dispute in the computation of 'available surplus ' for the accounting year 1966, which fall within question No. 1 referred to the Industrial Tribunal. The first item to which we must refer is the item of provision for bonus to employees made in the profit and loss account. This item figures as item 2(a) in the First Schedule to the Act and it is required to be added back in the computation of the gross profits under section 4(a). Now, so far as the profit and loss account of the Bank in respect of its Indian business was concerned, the provision for bonus to employees did not figure in it as a separate item, but, according to the Bank, it was included under the heading "Salaries and Allowances" or "other Expenditure" and it came to Rs. 19.52 lakhs. The Bank thus agreed to an add back of Rs. 19.52 lakhs in respect of provision for bonus to employees. The workmen, however, contended that the provision for bonus made by the Bank was for a much larger amount and the amount of Rs. 19.52 lakhs represented provision for bonus only in respect of those workmen who were 'employees ' within the meaning of section 2, cl; (13) and the Bank had failed to take into account the provision for bonus in respect of those workmen who were not such 'employees '. The argument of the workmen was that the word 'employees ' in item 2(a) of the First Schedule was not limited to 'employees ' as defined in section 2, cl. (13), but covered all employees, because the object of adding back provision for bonus to employees was to arrive at the figure of profit available for distribution of bonus and that required that the entire amount set apart as provision for bonus `should be added back, for in determining what is the available fund with reference to which bonus should be paid, one cannot ' exclude the amount already paid or provided as bonus, whether to employees drawing more than Rs. 1600/ or to employees drawing less. It is true, said the workmen, that the word 'employees ' is defined in section 2, d. (13), but they contended that every definition is subject to the requirement of the context and here the context clearly showed that the word 'employees ' was not used in the restricted sense, but in a wider sense, including all employees. Now, this argument of the workmen would have required serious consideration by us, but we do not 139 think we can permit the workmen to raise it, as it does not appear to have been advanced by them before the Industrial Tribunal. The award of the Industrial Tribunal does not show that this argument was at any time urged by the workmen. The only argument raised by the workmen before the Industrial Tribunal was that the amount of bonus payable to them for the accounting year 1966 was Rs. 38.66 lacs representing 18 per cent. Of their wage or salary and this amount of Rs. 38.66 lacs was liable to be added back and not the amount of Rs. 19.52 lacs this argument was rightly rejected by the Industrial Tribunal because what is liable to be added back under Item 2(a) of the First Schedule is not the amount of bonus payable to the workmen, nor the amount of bonus in fact paid, but the provision for bonus made in the profit and loss account. We cannot, therefore, permit the workmen to raise a new contention for the first time in this Court that the provision for bonus liable to be added back was not merely the provision for bonus to 'employees ' as defined in section 2 cl. (13), but also the provision for bonus to workmen who were not such 'employees '. The next item in dispute relates to the amount liable to be deducted from the gross profits under section 6, cl. What is required to be deducted under this clause is the amount of depreciation admissible in accordance with the provisions of sub section (1) of section 32 of the Income Tax Act. Now, depreciation represents the diminution in value of a capital asset when applied to the purpose of making profit or gain. There are various methods known to accountancy practice for measuring such diminution in value and a banking company, like any other firm or company, may follow any one of these methods in maintaining its accounts and the amount of depreciation calculated according to such method would be reflected in its profit and loss account. But, though such amount of depreciation shown in the profit and loss account may be unexceptionable from the point of view of commercial accountancy principles, it would not necessarily be admissible as a deduction from gross profits under section 6,. d. (a). What is allowable as a deduction from the gross profits under that clause is not depreciation calculated according to any recognised method of accountancy followed by a banking company, but only such depreciation as is admissible in accordance with the provisions of sub section (1) of section 32 of the Income tax Act. The profit and loss account of the Bank for the accounting year 1966 showed an amount of Rs. 22.40 lacs debited against the composite item "Depreciation and Repairs to the Banking Company 's Property" and according to the Bank, this file included an amount of Rs. 1.89 lacs by way of depreciation. Now, there would be no difficulty if the Bank claimed to deduct only the amount of Rs. 1.89 lacs by way of depreciation under section 6, cl. (a), as that was the amount of depreciation debited in the profit and loss account. But the Bank claimed that, though it had debited by way of depreciation in the profit and loss account only an amount of Rs. 1.89 lacs, the amount of depreciation actually admissible in accordance with the provisions of sums. (1) of section 32 of the Income tax Act was Rs. 12.79 lacs and in support of this claim, the Bank produced a certificate issued by the Income Tax officer which was marked exhibit 12 in evidence. The Industrial Tribunal relying solely on the certificate exhibit 12 held that "depreciation admissible in accordance with the provisions of sub section (1) of s; 32 of the Income tax Act" 140 was Rs. 12.79 lacs as evidenced by the certificate exhibit 12 and the Bank was, therefore, entitled to deduct that amount from the gross profits under section 6, cl. This decision of the Industrial Tribunal was assailed before us and it was contended on behalf of the workmen that the burden of showing what was the amount of depreciation admissible in accordance with the provisions of sub section (1) of section 32 of the Income tax Act was on the Bank and this burden, the Bank had failed to discharge by producing proper evidence. The only evidence produced on behalf of the Bank, said the workmen, was the certificate exhibit 12 issued by the Income tax officer, but that certificate was no evidence and could not be taken into account for the purpose of holding that the depreciation admissible under sub section (1) of section 32 of the Income tax Act was Rs. 12.79 lacs. The Bank, however, contended that the workmen did not at any time dispute that the depreciation admissible under sub section (1) of section 32 of the Income tax Act was Rs. 12.79 lacs nor did they at any time challenge the correctness of the certificate exhibit 12 issued by the Income tax officer and in the circumstances, this certificate was sufficient to establish the claim of the Bank. Now, in the first place, it is not correct to. say that the workmen did not at any time dispute the correctness of the figure of depreciation claimed by the Bank. Both the workmen and the Bank filed their respective computations of bonus before the Industrial Tribunal and while the Bank, in its computation, claimed to deduct the amount of Rs. 12.79 lacs as depreciation, the workmen agreed to deduction only of the amount of Rs. 1.89 lacs as appearing in the profit and loss account. The workmen did not at any time accept the position that the correct amount of depreciation admissible under section 32, sub section (1) of the Income tax Act came to Rs. 12.79 lacs as claimed by the Bank. They seriously disputed it before the Industrial Tribunal and hence the Industrial Tribunal had to go into that question and come to a finding upon it. Even prior to the making of the reference, when the calculation sheet regarding bonus payable for the accounting year 1966 was sent by the Bank to the` workmen with its letter dated 26th July, 1967, the workmen by their letter dated 3rd August, 1967 called upon the Bank to furnish particulars in regard to the amount of Rs. 12.79 lacs claimed by the Bank as depreciation and the only reply given by the Bank to this demand was that the information required by the workmen went "far beyond any legal requirements" and the Bank was not in a position to accede to the same. Vide Bank letter dated 8th August, 1967. This circumstance would also show that the workmen did not accept the figure of depreciation claimed by the Bank. It is true that in the application made by the workmen to the Industrial Tribunal for certain clarifications on 8th January, 1969, the workmen did not ask for any clarification in regard to the amount of Rs. 12.79 lacs claimed by the Bank by way of depreciation, but if we look at this application, it will be clear that the clarifications sought by the workmen were 'on various aspects of the published balance sheet of the company for the accounting years 1 1 1966 to 31 12 1966 and other figures ' and there was no attempt at seeking clarifications in respect of the various items in the computation sheet filed by the Bank. Moreover. when these clarifications were sought by the application dated 8th January, 1969 the 141 controversy between the parties was already crystalised in their pleadings and it was clear from the computation sheets filed by them that there was real dispute in regard to the amount of depreciation and, therefore, mere failure on the part of the workmen to ask for clarification in respect of the amount of Rs. 12.79 lacs claimed by the Bank, could not justify an inference that the workmen had conceded the claim of the Bank and abandoned the dispute. There can be no doubt that the dispute in regard to the amount of depreciation was very much there between the parties and it had to be resolved by the Industrial Tribunal. It was not seriously disputed on behalf of the Bank, and indeed having regard to the well settled position in law it could not be so disputed, that since the Bank claimed the deduction of depreciation at a figure higher than that appearing in the profit and loss account, the burden of proving that the depreciation claimed by it was the correct amount of depreciation admissible under section 32, sub section (1) of the Income tax Act was on the Bank and that burden had to be discharged by the Bank by producing proper and satisfactory evidence. Though the Industrial Tribunal relied solely on the certificate exhibit 12 issued by the income tax Officer for the purpose of holding that that, the correct amount of depreciation admissible under section 32, sub section (1) was Rs. 12.79 lacs, the Bank in the course` of its arguments before us, placed reliance not only on this certificate but also on the oral evidence of A. K. Basu who was the Officer examined on behalf of the Bank. We will first consider the oral evidence of A. K. Basu and then examine how far the certificate exhibit 12 helps to establish the claim of the Bank. The statement in the 'oral evidence of A. K. Basu which was strongly relied upon on behalf of the Bank, was: "Under the Heading 'Prior Charge ', the figure against 'depreciation ' was collected from the income tax assessment order" and it was contended that since there was no cross examination of A. K. Basu in regard to this statement, it must be accepted as correct and that was sufficient to prove that the depreciation admissible under section 32 sub section (1) was Rs. 12.79 lacs. This contention is wholly fallacious and it proceeds upon a misreading of the statement made by A. K. Basu. It is no doubt true that A. K. Basu stated that the figure against depreciation was collected from income tax assessment order, but this statement was made in reference to the figure against depreciation appearing in the First Enclosure to Annexure (C) to the written statement of the workmen, which was the computation sheet containing calculation of bonus for the accounting year 1965. That is evident from the context in which this statement occurs. This statement finds place in the paragraph which contains answers given by the witness to the Industrial Tribunal and the six sentences preceding this paragraph as also the first sentence of this paragraph clearly show that the answers were in reference to the accounting year 1965. We have carefully scanned through the entire evidence of A. K. Basu, but we do not find in it any statement in regard to the amount of depreciation shown in the Second Enclosure to Annexure (C) to the written statement of the workmen, which contained the computation in regard to bonus for the accounting year 1966. There was no evidence given by A. K. Basu in regard to the amount of Rs. 12.79 lacs claimed by the Bark by way of depreciation in the computation sheet submitted by it. Not a word 142 was said about it by A. K. Basu in his evidence and apart from A. K. Basu, no other witness was examined on behalf of the Bank. There was therefore, clearly no oral evidence to support the claim of the Bank. Even if the statement of A. K. Basu that the figures against depreciation were collected from the income tax assessment order be construed as referring to the computation sheet in respect of the accounting year 1966, it does not advance the case of the Bank. The income tax assessment order for the accounting year 1966 admittedly did not show depreciation at the figure of Rs. 12.79 lacs and that figure could not, therefore, have been collected by M. A. K. Basu, from the income tax assessment order. Even if the words Income tax assessment order ' as appearing in his statement be read so as to include the income tax return, it was admitted that the relevant income tax return was not produced on behalf of the Bank, and moreover, A. K. Basu admitted in his cross examination that he did not prepare the income tax return and consequently it must follow that he had no personal knowledge of the correctness or veracity of the income tax return and what he stated had no probative or evidentiary value. That leaves for consideration the certificate exhibit 12 issued by the Income tax officer which was strongly relied upon on behalf of the Bank and on which the Industrial Tribunal rested its decision on this part of the case. It is clear on a plain natural reading of the language of section 6, cl. (a) that what is deductible under that clause is "depreciation admissible in accordance with the provisions of sub section (1) of section 32 of the Income tax Act" and not "depreciation allowed by the Income tax Officer in making assessment on the employer". It is the Industrial Tribunal which has to find for itself what is the amount of depreciation admissible under sub s.(1) of section 32 and it cannot abdicate its duty and surrender its judgment to what has been done by the Income tax officer while making assessment under the Income tax Act. Since depreciation . may be computed according to various methods recognized by accountancy principles, section 6, clause (a) while providing for deduction of depreciation, had to specify the method according to which depreciation to be deducted shall be calculated and it adopted the method specified in sub section (1) of section 32. But the calculation of depreciation in accordance with this method would necessarily have to be done by the Industrial Tribunal which is entrusted with the task of determining the amount of bonus by applying the statutory formula. Therefore, it is the industrial Tribunal which must in the exercise of its quasi judicial duty calculate the amount of depreciation by adopting the method set out in sub section (1) of section 32. The Industrial Tribunal cannot say that it will Blindly accept the figure of depreciation arrived at by another authority charged with the function of determining depreciation under a different statute. The determination of the Income tax officer in regard to depreciation admissible under section 32, sub section (1) can be taken into account as evidence only if there is some provision of law which provides to that effect. We do not find anything in the Income tax Act or in the or in any other pro vision of law which attaches presumption of accuracy to the determination of the Income tax officer in this matter or invests it with probative or evidentiary value in the proceedings before the Industrial Tribunal. And the reason for this is obvious because the workmen, who are sought 143 to be bound by the determination of the Income tax officer, would not be parties to the income tax proceedings and they would have no opportunity of putting forward their point of view before the determination is arrived at by the Income tax officer. Moreover, the possibility cannot be ruled out that the determination made by the Income tax officer may be wrong and he might have made a bona fide mistake in arriving at the figure of depreciation. If the workmen were to be held bound by the figure of depreciation determined by the Income tax officer, they would have no opportunity of challenging its correctness or showing that it is wrong, nor would they be able to verify the figure of depreciation by cross examination of the employer or his witnesses who may have calculated the same. That would be contrary to the established principles of judicial procedure. There can, therefore, be no doubt that the certificate issued by the Income tax officer was not admissible in evidence to prove the depreciation admissible under sub section (1) of section 32 and ordinarily we would have refused to rely upon it and directed the Industrial Tribunal to arrive at a fresh decision after giving opportunity to the Bank to prove its claim for depreciation by leading evidence, but we find that the certificate of the Income tax officer was admitted in evidence without any objection on the part of the workmen and at no stage of the hearing before the Industrial Tribunal, it was contended on behalf of the workmen that it was an inadmissible piece of evidence. If the workman had contended before the Industrial Tribunal that the certificate of the Income tax officer was not admissible in evidence, the Bank could have led other evidence to substantiate its claim for depreciation, but since no objection was raised on behalf of the workmen, the Bank contented itself by producing and tendering in evidence only the certificate of the Income tax officer. We do not, in the circumstances see why reason to interfere with the decision of the Industrial Tribunal in regard to the amount of depreciation deductible under section 6, clause (a). We then come to item 3(a) of the First Schedule which requires bonus paid to the employees in respect of the previous accounting years to be added back in computing gross profits. The amount paid to the employees in the accounting year 1965 was Rs. 13.27 lacs and the work men claimed that this amount of Rs. 13.27 lacs should be added back under item 3(a) of the First Schedule. The Bank, in the computation sheet filed by it, also showed this amount of Rs. 13.27 as an add back and, therefore there should really have been no dispute about it. But the Industrial Tribunal refused to permit the Bank to add back this amount of Rs. 13.27 lacs on the ground that "a sum out of 1965 account must not be allowed to adulterate the account of 1966". This was an obvious error committed by the Industrial Tribunal. The amount of Rs. 13.27 lacs paid to the employees in respect of bonus for the accounting year 1965 was clearly, on the plain terms of Item 3(a) of the First Schedule, liable to be added back and we direct the Industrial Tribunal to do so when the case goes back to it. The item which then requires to be considered is that under cl. (iv) of the proviso to Item 2. Of the Third Schedule. That clause provides that in the case of a banking company, any sum which, in 144 respect of the accounting year, is deposited by it with the Reserve Bank of India under section 11(2)(b)(ii) of the Banking Regulation Act, 1949 not exceeding the amount required under the said provision to be so deposited, shall be deducted from the gross profits. The Bank claimed to deduct under this item a sum of Rs. 13.48 lacs on the ground that it represented the amount deposited by the Bank with the Reserve Bank of India under section 11(2)(b)(ii) of the Banking Regulation Act, 1949 and produced in support of this claim, a certificate of the Reserve Bank of India dated 3rd February, 1969 confirming that the Bank had deposited security adequate to fulfil the requirements section 11(2)(b)(ii) of the Banking Regulation Act, 1949 in respect of the accounting year 1966. This certificate was produced by A. K. Basu on behalf of the Bank without ally objection by the workmen and it was marked exhibit 11. The Industrial Tribunal accepted the claim of the Bank on the strength of this certificate and permitted deduction of the amount of Rs. 13.38 lacs. The workmen impugned this decision of the Industrial Tribunal on the ground that the balance sheet of the Bank for the accounting year 1966 showed that the amount deposited by the Bank with the Reserve Bank of India during that accounting year was only Rs. 70,000/ being the difference between Rs. 99.10 lacs and Rs. 98.40 lacs and it was therefore, only this amount which was liable to be deducted in respect of this claim. But this contention of the workmen is clearly fallacious. The balance sheet of the Bank for the accounting year 1966 would not show the amount deposited by the Bank with the Reserve Bank of India in respect of that accounting year, for, on a plain reading of section 11(2)(b)(ii) of the Banking Regulation Act, 1949, that amount would ordinarily be deposited only after the expiration and not during the currency of that accounting year. No reliance can, therefore, be placed on behalf of the workmen on the balance sheet of the Bank for the accounting year 1966 for the purpose of repelling the claim of the Bank. On the other hand, the evidence given by A. K. Basu on behalf of the Bank clearly showed that the Bank had deposited with the Reserve Bank of India securities adequate to fulfil the requirements of section 11(2)(b)(ii) of the Banking Regulation Act, 1949 and this statement made by the witness was sought to be supported by the certificate issued by the Reserve Bank of India. The workmen did question A. K. Basu on this point, but he clearly stated that the deposit was made in securities. Having regard to this evidence of A. K. Basu supported by the certificate of the Reserve Bank of India, we must hold that the claim of the Bank to deduction of the amount of Rs. 13.48 lacs was well founded and it was rightly allowed by the Industrial Tribunal. That takes us to the last item in dispute which is Item 6(e) of the First Schedule. That item requires that in the case of foreign banking companies, Proportionate Administrative (over Head) Expenses of Head office allocable to Indian business shall be deductible in computing gross profits. The Bank claimed that a sum of Rs. 43.40 lacs was Liable to be deducted under this item, while according to the workmen, the claim for deduction was admissible 145 Only to the extent of Rs. 43.10 lacs. The Industrial Tribunal, however, did not accept the figure of either party but made its own calculations and came to the conclusion that the proportionate administrative expenses allocable to Indian business amounted to Rs. 23.88 lacs and hence that was the amount deductible under this item. This decision of the Industrial Tribunal was challenged on both sides. In order to appreciate the grounds of challenge, it is necessary to understand how the Industrial Tribunal actually calculated the proportionate administrative expenses of Head office allocable to Indian business. Foot Note 3 of the First Schedule provides that proportionate administrative expenses of Head office allocable to Indian business should be calculated "in the proportion of Indian Gross profit (Item No. 7) to total world gross profit (as per consolidated profit and loss account, adjusted as in Item No. 2 above only)". Now, the administrative expenses of Head office were admittedly Rs. 120.52 lacs and if X was the amount of proportionate administrative expenses allocable to Indian business, X/120 would be equal to Indian gross profit under Item No. 7/total world gross profit adjusted as in Item No. 2. The Indian gross profit for the purpose of working out this proportion was calculated by the Industrial Tribunal by taking the figure of Rs. 67.39 lacs which was the net profit shown in the profit and loss account and adding to it Rs. 19.52 lacs representing bonus to employees and Rs. 1.89 lacs representing depreciation and it was, thus, determined at Rs. 88.80 lacs. Here there was a manifest error committed by the Industrial Tribunal. The net profit of Rs. 67.39 lacs shown in the profit and loss account was admittedly arrived at after deducting from the profit of the Bank a sum of Rs. 43.10 lacs in respect of actual head office administrative expenses allocable to India. This amount of Rs. 43.10 lacs was obviously required to be added back, since Item 6(e) provided for deduction of proportionate Head office administrative expenses allocable to Indian business and the same item could not be deducted twice over in arriving at the Indian gross profit. It is true that Item 1 of the First Schedule requires the Industrial Tribunal to take as the starting point of computation "net profit as shown in the profit and loss account after making usual and necessary provisions". But the fact that Item 6(e) provides for deduction of proportionate administrative expenses of Head office allocable to Indian business in arriving at the gross profit for the purpose of bonus under Item 7 shows that the net profit contemplated in Item 1 is net Profit arrived at without deducting proportionate administrative expenses of head office allocable to Indian business. That is not regarded by the Legislature as usual and necessary provision should be deducted for the purpose of ascertaining net profit under Item 1. This position was indeed not disputed by the learned counsel appearing on behalf of the Bank and it is therefore, obvious that the amount of Rs. 43.10 lacs should be added back in arriving at the figure of net profit for the purpose of Item 1. Then again, it is clear from the calculation made by the Industrial Tribunal that in computing the Indian gross Profit at the figure of Rs. 88.80 lacs, the Industrial Tribunal added black only the amounts representing bonus to employees and depreciation as set out in Item 2 of the First Schedule. But Foot Note 3 146 requires that the Indian gross profit should be determined as shown in Item 7 and, therefore, it was necessary to add back not only amounts under item 2 but also amounts under items 3 and 4 and to deduct amounts under item 6 for the purpose of arriving at the Indian gross profit under item 7. This, the Industrial Tribunal clearly failed to do. We would, therefore, direct the Industrial Tribunal. When the case goes back to it, to determine the figure of Indian gross profit as set out in item 7 after adding back the amount of Rs. 43.10 lacs the figure of net profit under Item 1. The workmen also pointed out another error in the calculation made by the Industrial Tribunal and that was in regard to computation of total world gross profit. Foot Note 3 requires that the total gross profit should be as per consolidate profit and loss account after adjustment as in Item 2. That means that the provision made in the consolidated profit and loss account for bonus to employees, depreciation, development rebate reserve and any other reserves should be added back to the net profit as shown in the consolidated profit and loss account for the purpose of arriving at the total world gross profit. What the Industrial Tribunal, however, did in the present case was to add back merely the provision made in the profit and loss account of the Indian business for bonus to employees and depreciation. The Industrial Tribunal did not examine what was the provision made in the consolidated profit and loss account of the Bank for bonus to employees, depreciation, development rebate reserve and other reserves. If any provision were made in the consolidated profit and loss account for bonus to employees, which would mean employees of the Bank throughout the world, depreciation on world assets and development rebate and other reserves, such provision would have to be added back to the net profit as shown in the consolidated profit and loss ' account. This would have to he done by the Industrial Tribunal when the matter goes back to it on remand. The Industrial Tribunal will, thus, after calculating the Indian gross profit above, apply the proportion of Indian gross profit/total world gross profit to the amount of Rs. 120.52 lacs representing the administrative expenses of Head Office and determine the proportionate administrative expenses of head office allocable to Indian business for the purpose of deduction under Item 6(e) of the first Schedule. We must also refer to one other ground of challenge put forward on behalf of the Bank against the decision of the Industrial Tribunal in regard to the amounts deductible under cls. (ii) and (iii) of the proviso to Item 2 of the Third Schedule. This ground of challenge was urged on behalf of the Bank in support of the ultimate award of the Industrial Tribunal determining the bonus payable to the workmen at a little over 9 per cent. Of their salary or wage. It was clearly open to the Bank to urge this ground of challenge since the Bank was entitled to support the award of the Industrial Tribunal 147 even on a ground decided against it. Vide J. K. Synthetics Ltd. vs A J. K. Synthetics Mazdoor Union(1) and Management of I.C.C. vs Workmen(2). The controversy arising out of this ground of challenge turned on the true interpretation of the works 'working funds ' in clauses (ii) and (iii) of the proviso to Item 2 of the Third Schedule. The Industrial Tribunal interpreted the words 'working funds ' to mean "paid up capital, reserves and deposits" and rejected the contention of the Bank that they also included borrowings from other banking companies, bills payable and balance of profit and loss account. This view taken by the Industrial Tribunal was assailed on behalf of the Bank at the hearing of the appeal before us. The Bank contended that borrowings from other banking companies, the amounts of bills issued by the Bank and balance of profit and loss account constituted part of the working funds of the Bank and were, therefore, within the expression "working funds". This contention, plausible though it may seem at first sight, is, in our opinion, not well founded. The words "working funds", when used in relation to a banking company, are not to be construed in their ordinary popular sense by reference to a dictionary. They have a history of their own and they have acquired a definite meaning. These words were first defined in the award made by Mr. K. C. Sen in 1949 in regard to banks and the definition he gave was that 'working funds ' consisted 1 of "paid up" capital, reserves and deposits". So also in the Sastri Award made in 1953 in regard to Industrial desputes between certain banking companies and their workmen, the words 'working funds ' were defined to mean "paid up capital, reserves and the average of the deposits for 52 weeks of each year for which weekly. returns of deposits are submitted to the Reserve Bank of India under the provisions of the Reserve Bank of India Act". So far as banking companies are concerned, the words 'working funds ' have always been understood in this sense and that is the sense in which they must be deemed to have been used by the Legislature when it enacted cls. (ii) and (iii) of the proviso to Item 2 of the Third Schedule. It is a well settled rule of interpretation that when the Legislature uses certain words which have acquired a definite meaning over a period of time, it must be assumed that those words have been used by the Legislature in the same sense. The words 'working funds ' in cls. (ii) and (iii) of the proviso to Item 2 of the Third Schedule must, therefore, be construed to mean Paid up capital, reserves and average of the deposits for 52 weeks of each year for which weekly returns of deposits are submitted to the Reserve Bank of India. It could hardly be disputed that borrowings from other banking companies the amounts of bills issued by the Bank and the balance of profit and loss account are neither reserves nor deposits and they are not liable to be shown in the weekly returns of deposits submitted to the Reserve Bank of India. The Industrial Tribunal was, therefore right in excluding them from the category of 'working funds ' and this round of challenge urged on behalf of the Bank must be rejected. (1) [1972]1 S.C.R. 651 (2) ; 148 We accordingly set aside the award made by the Industrial A Tribunal and remand the case to the Industrial Tribunal with a direction to dispose it according to law in the light of the decisions given and observations made in this judgment. Since the workmen have partly succeeded and partly failed, we think that the fair order of costs would be that each party should bear and pay its own costs of these proceedings. P.B.R Appeal allowed in part.

As a result of negotiations between the respondent Bank and its employees (appellants) an industrial dispute with regard to bonus for the years 1956 to 1964 was settled on an ad hoc basis. By the time of the settlement however the came into force. In respect of the accounting year 1964, though the bonus formula was applicable, no separate computation was made in accordance with that formula since it was settled on an ad hoc basis as a part of an omnibus settlement. The Bonus Act provides a statutory formula for the computation of bonus. Section 2(13) defines an 'employee ' to mean any person employed on a salary or wage not exceeding one thousand and six hundred rupees per mensem. Section 4(a) provides that the gross profits shall be calculated in the manner specified in the First Schedule. Item 2 of the First Schedule deals with "add back" in respect of (a) bonus to employees, (b) depreciation (c) development rebate reserve and (d) any other reserves. Item 3(a) deals with "add back" of bonus paid to employees in respect of previous accounting years. Item 6(e) deals with deduction in the case of foreign banking companies of proportionate administrative (overhead) expenses of head office allocable to Indian business. The concept of "available surplus" is defined in section 2(6) to mean available surplus computed under section 5 and that section lays down that the available surplus in respect of any accounting year shall be the gross profit for that year after deducting therefrom the sums referred to in section 6 which, under clause (a) include "any amount by way of depreciation admissible in accordance with the provisions of section 32(1) of the Income Tax Act" and under clause (d) "such further sums as are specified in respect of the employer in the Third Schedule. " Clause (iv) of the proviso to item 2 of the Third Schedule provides that in the case of a banking company any sum which, in respect of the accounting year, is deposited by it with the Reserve Bank of India under section 11 (2)(b)(ii) of the Banking Regulation Act, 1949 not exceeding the amount required under this provision to be so deposited shall be deducted from the gross profits as prior charge. Section 15 provides for what is liable to be carried forward for being set on and set off out of allocable surplus in the succeeding year or years. An industrial dispute having arisen between the parties in regard to the computation of bonus for the accounting year 1966, it was referred to an Industrial Tribunal for adjudication. The Tribunal 's award was assailed by the workmen on the following grounds: (a) that there was an excess of allocable surplus over the amount of maximum. bonus for the accounting years 1964 and 1965, which, by reason of section 15(1), was liable to be carried forward for being set on in the succeeding accounting year 1966; (b) that while the object of "add back" was that the entire amount set apart as provision for bonus should be added back in determining the available surplus. in spite of making a provision of a much larger amount as bonus, the Bank had added back only a small amount representing the bonus of those workmen who were employees falling within the meaning of section 2(13) and there by failed to take into account bonus in respect of those workmen who are not such employees; the word 'employee ' in items 2(a) of the First Schedule was not limited to employees as defined in section 2(13) but was used, in a wider sense to include all employees, that is, employees drawing more than 1600 rupees or less; 131 (c) that the Tribunal was wrong in allowing the Bank to deduct a much A higher sum by way of depreciation than was shown in the profit and loss account, that the burden of showing what the amount of depreciation admissible under section 32(1) of the Income Tax Act was, was on the Bank which it had failed to discharge and that, at any rate the certificate issued by the Income Tax officer was no evidence and could not be taken into account; (d) that the balance sheet of the Bank for the year 1966 showed a much lesser amount than what the Bank claimed to have deposited with the Reserve Bank under section 11 (2)(b) (ii) of the Banking Regulation Act, 1949 and it was this sum which was liable to be deducted under this head and not the larger sum which it actually deducted. The Industrial Tribunal 's calculation of proportionate administrative (over head) expenses of head office allocable to the Indian business which are deductible in computing the gross profits, both the Bank and the employees assailed it as being incorrect, For the bank, it was contended, (a) that borrowings from other banking companies, the amount of bills issued by the bank and the balance of profit and r loss account constituted part of its "working funds" and that the Industrial Tribunal was wrong in rejecting this interpretation of "working funds" and in limiting it to 'paid up capital, reserves and deposits only". (b) that the Tribunal was wrong in refusing to permit the Bank to add back the sum falling under item 3(a) of the First Schedule. ^ HELD. 1. The workmen are rot entitled to contend that though the claim for bonus for the year 1964 was settled on an ad hoc basis without making computation under the provisions of the Act, such computation must now be made, not for the purpose of determining the bonus payable to them, but for the purpose of determining whether there is any amount liable to be carried forward and set on. Section 15(1) can have no application where no computation is made under the Act and bonus is paid, not in accordance with the statutory formula, but on an ad hoc basis. Then it is not possible to say what was really the bonus payable under the Act. It may be less or more than the bonus in fact paid. That enquiry being rendered irrelevant by the ad hoc settlement, there can be no question of carry forward and set on of any amount, unless specifically agreed upon as part of the settlement. [137 F 138 G] 2. The workmen cannot be permitted to raise a new contention for the first time in this Court that the provision for bonus liable to be added back was not merely the provision for bonus payable to employees as defined in section 2(13) of the Act but also the provision for bonus payable to workmen who are not such employees. What is liable to be added back under item 2(a) of the First Schedule is not the amount of bonus payable to the workmen nor the amount of bonus in fact paid, but the provision for bonus made in the profit and, loss account, 3(a) Though the amount of depreciation calculated in accordance with account. [139 B C] 3. (a) Though the amount of depreciation calculated in accordance with methods known to accountancy practice may be unexceptionable from the point of view of commercial accountancy, it would not necessarily be admissible as a deduction from gross profits under section 6(a). What is allowable as a deduction from the gross profits under that clause is not depreciation calculated according to any recognised method but only such depreciation as is admissible in accordance with the provisions of section 32(1) of the Income Tax Act, 1961. [139 E F] (b) The burden of providing that the depreciation claimed by the Bank was the correct amount admissible under section 32(1) of the Income Tax Act, 1961 was on the Bank and that burden had to be discharged by the Bank by producing proper and satisfactory evidence. [141 C] (c) A certificate issued by the Income Tax officer was not admissible in evidence to prove the depreciation admissible under section 32(1). It is the Industrial Tribunal which must, in the exercise of its quasi judicial duty, calculate the amount of depreciation by adopting the method set out in section 32(1). The Tribunal cannot say that it would accept the figure of depreciation arrived at br another authority charged with the function of determining depreciation under 132 a different statute. There is nothing in the Income Tax Act or in the or in any other provision of law which attaches a presumption of accuracy to the determination of the Income Tax officer in ' this matter or invests it with probative or evidentiary value in the proceedings before the Industrial Tribunal. [142 F 143 C] In the instant case, however, there is no reason to interfere with the decision of the Tribunal in regard to the amount of depreciation deductible under section 6(a). The certificate of the Income Tax officer was admitted in evidence without any objection by the workmen. Had the workmen objected to its admissibility before the Tribunal the Bank could have led other evidence to substantiate its claim for depreciation. Since no such objection was taken before the Tribunal the Bank contented itself by tendering in evidence only the certificate of the Income Tax officer. [143 C D] 4. No reliance can be placed by the workmen on the balance sheet for 1966 for repelling the Bank 's claim to deduct from the gross profit the amount deposited with the Reserve Bank of India under section 11(2) (b)(ii) of the Banking Regulation Act, 1949. The balance sheet for the accounting year 1966 would not show the amount deposited by the Bank with the Reserve Bank in respect of that accounting year, because that amount would ordinarily be deposited only after the expiration, and not during the currency of that accounting year [144C F] 5. (a) The Industrial Tribunal had committed a manifest error. in regards to the calculation of Proportionate Administrative (overhead) Expenses of head office allocable to Indian business. Although item 1 of the First Schedule requires the Industrial Tribunal to take as the starting point of computation "net profit as shown in the profit and loss account after making usual and necessary provisions", The fact that item 6(e) provides for deduction of proportionate administrative expenses of head office allocable to Indian business in arriving at the gross profit for the purpose of bonus under item 7 shows that the net profit contemplated in the item 1 is the net profit arrived at without deducting proportionate administrative expenses of head office allocable to India business. The amount in respect of the actual head office administrative expenses allocable to Indian business should be added back in arriving at the figure of net profit for the purpose of item 1. [145 D 146 B] . (b) In computing the Indian gross profit the Industrial Tribunal added back only the amounts representing bonus to employees and depreciation as set out in item 2 of the First Schedule. Foot note 3 requires that the Indian gross r profit should be determined as shown in item 7 and, therefore, it was necessary to add back not only amount under item 2 but also item 3 and 4 and to deduct amounts under item 6 for the purpose of arriving at the Indian gross profits under item 7. [146 A B] (c) In calculating the total gross profits the Industrial Tribunal committed an error by adding back merely the provision made under the profit and lass account of the Indian business for bonus to employees and depreciation. Foot note 3 requires that the total world gross profit should be as per consolidated profit and loss account after adjusting as in item 2 which means that the provision made in the consolidate profits and loss account for bonus to employees; depreciation, development rebate reserve and any other reserves should be added back to the net profit as shown in the consolidated profit and loss account for the purpose of arriving at the total world gross profit. The Industrial Tribunal did not explained what was the provision made in the consolidated profit and lost; account of the Bank under this head. If any provision were made in the consolidated profit and loss account for bonus to employees, which would mean employees of the Bank throughout the world, depreciation on world assets and development rebate and other reserves such provision would have to be added back to the net profit as shown in the consolidated profit and loss account 6 (a) The Industrial Tribunal was right in its interpretation of the term "working funds" occurring in cl. (ii) and (iii) of the proviso to item 2 of the Third Schedule. The term must be construed to Mean paid up capital, reserves 133 and average deposits for 52 weeks of each year for which weekly returns of deposits are submitted to the Reserve Bank of India. It could hardly be disputed that borrowings from other banking Companies, the amounts of bills issued by the Bank and the balance of profit and loss account are neither reserves nor deposits and they are not liable to be shown in the weekly returns of deposit submitted to the Reserve Bank of India. [147 F H] (b) The term "working funds" was first defined in the award of Mr. K. C. Sen in 1919 in regard to Banks, and it was also used ill the Shastri award made in 1953 in regard to industrial disputes between certain banking companies and their workmen. These words have always been understood in the above sense and that is the sense in which they must be deemed to have been used by the legislature when it enacted clauses (ii) and (iii) of the proviso to item 2 of the Third Schedule. [147 D F] 7. The Industrial Tribunal was wrong in refusing to permit the Bank to add back the sum of Rs. 13.27 lacs on the ground that "a sum out of 1965 account must not be allowed to adulterate the amount of 1966. " This sum paid to the employees in respect of bonus for the accounting year 1965 was, on the plain terms of item 3(a) of the First Schedule, liable to be added back. [143 F H]

vil Appeals Nos. 1671 87 of 1987. From the Judgment and order dated 22.4.1987 of the Customs, Excise and Gold (Control) Appellate Tribunal, New Delhi in Appeal No. 1546, 1547 etc. in Order No. 267 to 283 of 1987 B I. M.K. Banerjee, Solicitor General, R.P. Srivastava and P. Parmeswarn for the Appellants. Soli J. Sorabji, K.K. Patel, Rajiv Dutta and R.S. Sodhi for the Respondents . The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J. These are appeals from the decision of the Customs, Excise & Gold (Control) Appellate Tribunal, New Delhi (hereinafter referred to as 'CEGAT ') under Section 35L(b) of the Central Excises & Salt Act, 1944 (hereinafter called 'the Act ). The respondent Calcutta Steel Industries filed revised classification lists wherein they had classified all rectangular products of thickness below 3.0 mm manufactured by them as bars covered by Tariff item 26AA(ia) of the Central Excise Tariff. The Assistant Collector, Central Excise was of the tentative view that rectangular products of thickness less than 3.0 mm and of width less than 75 mm conform to the definition of Hoops and merit classification under item (ii) of Tariff Item 26AA attracting effective rate of duty of Rs.450 per MT less the PG NO 597 reduction provided for under Notification No. 55/80 dated 13th May, 1980. The respondents were, therefore, called upon to show cause as to why the classification list should not be amended and duty charged accordingly. The respondents submitted their written statement and requested for a personal hearing. The matter came up for adjudication before the Assistant Collector, Central Excise. He held inter alia that the type of Mills used for the manufacture was irrelevant. He relied on the definition of "Hoops" evolved in consultation with the Ministry of Steel and the Indian Standard Institution. The revised definition was as follows: "The finished product, generally of cross section with edges of controlled contour and of thickness 3.0 mm and over width 400 mm and below and supplied in straight lenths. The product shall have rolled edges only (square or slightly rounded). This group also includes flat bars with bulb that has swelling on one or two phases of the same edge under width of less than 400 mm. The Assistant Collector, Central Excise on the basis of certain discussion, in his order, was of the view that rectangular products of thickness less than 3.0 mm and of width less than 75 mm were hoops and were correctly classified under sub item (ii) of Tariff item 26AA of the Central Excise Tariff and accordingly exigible to the appropriate duty. The revised classification list was accordingly modified and approved. The respondents preferred appeals to the Collector of Central Excise (Appeals). The Collector considered the Indian Standard 1956 62 (2nd reprint May 1975) which defined "Hoops" as follows: "5.54 HOOP (bailing, hoop iron) a Hot Rolled Flat Product, rolled in rectangular section of thickness less than 3.0 mm and width less than 75.0 mm." He held that according to the specifications the product in question sequarely fell within the above definition particularly when the description of the Tariff Items covered "Hoops, all sorts". The Appellate Collector also considered the definition of "Hoop and Strips" in the Brussels Tariff Nomenclature which described these as follows: "Hoop and Strip (heading No. 73. 12) rolled products with sheared or unsheared edges of rectangular section, of a thickness set exceeding 6 milli PG NO 598 metres, of width not exceeding 500 millimetres and of such dimension that the thickness does not exceed one tenth of the width, in straight strips, coils or flattened coils." He accordingly held that this definition showed that the edges of the product in question might be sheared or unsheared and the products might be in straight lengths or in coils. He also held that the nature or type of mill cannot by itself be the determining factor of the issue in dispute which has to be determined taking into account all relevant considerations, viz., the phraseology and the scope of the Tariff Entry, the trade practice terminology, well recognised standard national and international technical literature. In the result, the Appellate Collector of Central Excise inter alia for the reasons stated above, found no reason to interfere with the order of the Assistant Collector, Central Excise which was accordingly upheld. The respondents preferred appeals to the Tribunal. The Tribunal allowed the appeals and held that the flat product of thickness less than 3.0 mm and a width of less than 75 mm is classifiable as bars as claimed by the respondents herein and not as hoops as held by the Assistant Collector, Central Excise and upheld by the Appellate Collector of Central Excise. in allowing the appeals, the Tribunal referred to U.S. Steel Publications (The shaping and treating of steel) wherein it is stated as follows: "goods have been rolled in a bar mill and have not been subjected to the process mentioned by the book for producing hoops and that they were not meant for bailing or packaging which a hoop is meant for. ' ' The Tribunal in its order discussed various aspects of the matter. The Tribunal noted that the Collector had stated and what are the different categories. In U.S. Steel Publication (The Making, Shaping and Treating of Steels) edited by Herald E. Mc. Gannon 9th Edition whom the Tribunal has described as an authority on the Steel and we presume he is, there are some observations at page 808 under the heading "Narrow Flat rolled products" which are relevant. There,"Hoops" have been described as follows: "Hoop There are four general classification of this type of products: 1. Tight cooperage hoop for barrels to hold liquid. PG NO 599 2. Slack barrell hoop for barrels to hold dry products. Tobacco barrel hogshead hoop, and 4. Special hoop for special packages. " It has further to be noted that "hoop" is made either by slitting coiled strip rolled in multiple width, into narrow coiled strip of the desired width, or from narrow coiled strip with a not rolled or mill edge and the type and width of hoop being produced influences the choice of the method used. It further appears that the method of the products in question is not one of the methods listed in this authoritative work for hoops. The so called hoops were not produced by slitting coiled strip nor rolled from narrow coiled strip, with hot rolled or mill edge. The article, as has been noted, says that "hoop" is produced as ' curled hoop ' or 'a straight length '. Curled hoop is made by a pinchroll and curved guide shoe arrangement that permits the hoop to take a circular form. A straight length hoop is produced merely by removing the curved guide shoe. The Tribunal was conscious that the goods in question were neither curled hoops nor straight length. In those circumstances, it was necessary to understand clearly that the "straight length" used in this book is not the straight length understood by the department which seems to think that any short straight length is the straight length signified by the term for these products. It is nothing of the kind as can be seen from the above passage quoted from the authority. Straight length is not a short length, it is long. The means of producing the goods is completely different from what is generally written. The Tribunal was justified in holding that it is not possible to agree with the department that the manner of production of the goods can be taken into account. It has also to be borne in mind that the very nature of the mill was a criteria to decide the nature of the product manufactured. Further, however, taking into account the nature and type of the mill cannot itself be the determining factor in the issue in dispute. The Tribunal also took into account that these are produced in a mill which cannot produce hoops or strips. The Tribunal found the fact that they were produced in a mill that could produce hoops and strips. Their lengths are not such as to place them in the same class as hoops. Having, therefore, regard to this and the relevant tariff item, the Tribunal came to the conclusion that it will be more appropriate to assess them PG NO 600 under item 26AA(ia) than under Item 26AA(ii). The Tribunal has considered all the relevant facts. There was no misdirection on the facts. All proper and relevant materials relevant for the determination of the question before the Tribunal have been applied to. Reliance was placed on certain observations of this Court in South Bihar Sugar Mills Ltd. vs Union of India & Ors., ; There, this Court was dealing with Item 14A and the appellants ' manufacturing mixture of gases containing carbon dioxide by burning lime stone with coke in using only the carbon dioxide from the mixture for refining sugarcane juice and for producing soda ash by solvay ammonia soda process Whether the mixture of gases was kiln gas or compressed carbon dioxide covered by Item 14 H in Schedule I to the Act. It was held by this Court that the gas generated by the appellant companies was kiln gas and not carbon as known to the trade, i.e., to those who deal in it or who use it. The kiln gas in question therefore is neither carbon dioxide nor compressed carbon dioxide known as such to the commercial community and therefore cannot attract Item 14 H in the First Schedule. It was held that it was incorrect to say that because the sugar manufacturer wants carbon dioxide for carbonisation purposes and sets up a kiln for it that he produces carbon dioxide and not kiln gas. In fact what he produces is a mixture known both to trade and science as kiln gas one of the constituents of which is no doubt, carbon dioxide. The kiln gas which is generated in these cases is admittedly never liquified nor solidified and is therefore neither liquified nor solidified carbon dioxide, assuming that it can be termed carbon dioxide. It cannot be called compressed carbon dioxide as understood in the market among those who deal in compressed carbon dioxide. If the Revenue wants to tax a particular goods known as such then the onus is on the Revenue. That they have failed. The Tribunal has analysed all the aspects. In appeal, we have to see the propriety and the correctness of adjudication. Having examined the aspects from all angles, we find that there was no misdirection in law nor any non consideration of facts. There is no exclusion from consideration of legitimate and proper materials. In the premises, we have also examined the ultimate conclusion of the Tribunal. That conclusion appeals to us. It follows irresistibly from the other premises as indicated hereinbefore. In the premises, the appeals fail and are accordingly dismissed. S.K.A. Appeals dismissed.

The respondent company filed revised classification lists classifying all rectangular products of thickness below 3.0 mm manufactured by them as bars covered by Tariff Item 26AA(ia) of the Central Excise Tariff. The Asstt. Collector, Central Excise took the view that rectangular products of thickness less than 3.0 mm and of width less than 75 mm fell under the definition of 'Hoops ' and merit classification under Tariff Item 26AA(ii) and exigible to the appropriate duty. The respondent preferred an appeal before the Collector of Central Excise who held that the product fell within the definition of 'Hoops ' and upheld the order of the Asstt. Collector. The respondent appealed to the Tribunal which held that the flat product of thickness less than 3.0 mm and a width of less than 75 mm was classifiable as 'bars ' as claimed by the respondent company and not as 'Hoops ' and allowed the appeals. The Department therefore filed the appeals under Section 35L(b) of the Central Excises & Salt Act, 1944 before this Court. Dismissing the appeals, this Court, HELD: If the revenue wants to tax a particular goods known as such then the onus is on the Revenue. [600F] 'Hoop ' is made either by slitting coiled strip rolled in multiple width, into narrow coiled strip of the desired width, or from narrow coiled strip with a hot rolled or mill edge and the type and width of hoop being produced influences the choice of the method used. [599B] Curled hoop is made by a pinch roll and curved guide shoe arrangement that permits the hoop to take a circular form. A straight length hoop is produced merely by removing the curved guide shoe.1599D] PG NO 597 PG NO 598 Straight length is not a short length, it is long. [599E] The fact is that they were produced in a mill that could produce hoops and strips. Their lengths are not such as to place them in the same class as hoops. Having, therefore, regard to this and the relevant tariff item, the Tribunal came to the conclusion that it will be more appropriate to assess them under Item 26AA(ia) than Item 26AA(ii). [599(G H; 600A] South Bihar Sugar Mills Ltd. vs Union of India & Ors., ; , referred to. In an appeal under Section 35L(b) this Court has to see the propriety and the correctness of adjudication. There was no misdirection in law nor any non consideration of facts. There is no exclusion from consideration of legitimate proper materials. [600F G]

Civil Appeal No. 1185 of 1979, Appeal by Special Leave from the Judgment and order dated 15.12.1978 of the Gujarat High Court in Sales Tax Reference No. 24 of 1978. AND Civil Appeal No. 1187 of 1979. Appeal by Special Leave from the Judgment and order dated 27.11.1978 of the Gujarat High Court in Sales Tax Reference No. 11 of 1977. K H. Kaji, T. Sridharan, R.D. Pathak, Miss C. K. Sucharita and Mrs. section Bhandare for the Appellant in both the Appeals. S.T. Desai and M.N. Shroff for the Respondent in both the Appeals. 437 The Judgment of the Court was delivered by VENKATARAMIAH, J. Since a common question of law is involved in these two appeals by special leave, they are disposed of by this common judgment. The appellant in Civil Appeal No. 1185 of 1979 is M/s. Hindustan Brown Boveri Ltd., a company engaged in the business of manufacturing certain goods which are used in electrical undertakings for the purpose of generating and distributing electrical energy. It is registered as dealer under the provisions of the Gujarat Sales Tax Act, 1969 (Gujarat Act No. I of 1970) (hereinafter referred to as 'the Act '). For the purpose of manufacturing the goods, the appellant which was also a recognised dealer under the Act purchased raw materials during the period between May 6, 1970 and March 31, 1971 after furnishing a certificate in Form No. 19 as provided under section 13(1)(B) of the Act read with Rule 24(4) of the Gujarat Sales Tax Rules, 1970 (hereinafter referred to as 'the Rules ') framed under the Act stating that the raw materials purchased by it would be used in manufacturing taxable goods which would be sold by it in the State of Gujarat. Some part of the goods manufactured by the appellant were sold to a certain electrical undertaking in the State of Gujarat against 'C ' forms in order to claim exemption from payment of tax on the said sales under the Act by virtue of a notification issued under section 49(2) of the Act exempting the goods sold to electrical undertakings for being used in generation and distribution of electrical energy. On coming to know of the said sales, the Sales Tax officer. , who was the assessing authority under the Act levied purchase tax under section 16 of the Act on the raw materials purchased be the appellant on the ground that the undertaking given in Form No. 19 had been violated. The appeals filed by the appellant before the Assistant Commissioner of Sales Tax and the Gujarat Sales Tax Tribunal against the said levy were unsuccessful. Thereafter at the instance of the appellant the Tribunal referred the following question of law to the High Court of Gujarat under section 69 of the Act: "Whether on the facts and in the circumstances of the case, and on a correct interpretation of sub section (33) of section 2 of the Gujarat Sales Tax Act, 1969 the Tribunal was right in deciding that the applicant was liable to pay purchase tax under section 16 of the Gujarat Sales Tax Act, 1969 on the ground that certain electric goods manufactured 438 out of raw materials etc. purchased against declaration in Form 19 were sold to Gujarat State Electricity Board against declarations in Form prescribed in Entry 5 of the Government Notification issued under section 49 of the Gujarat Sales Tax Act, 1969 ?" The appellant in Civil Appeal No. 1187 of 1979 is M/s. Hindustan Engineering Co. Ltd. which is engaged in manufacturing heavy machinery and gear conveyers. It is also a recognised dealer under the Act. Like the appellant in Civil Appeal 1185 of ]979, this appellant also purchased raw materials by furnishing certificates in Form No. 19 and later on sold a part of the goods manufactured by it to a certain electrical undertaking against Form No. 'C ' and claimed exemption under the notification issued under section 49(2) of the Act. In this case also the Sales Tax officer levied purchase tax under section 16 of the Act for violation of the undertaking given in Form No. 19. The appeals to the Assistant Commissioner of Sales Tax and the Gujarat Sales Tax Tribunal failed. Thereafter at the instance of the appellant, the Gujarat Sales Tax Tribunal referred the following question for the opinion of the High Court of Gujarat: Whether on the facts and in the circumstances of the case, the Tribunal is justified in holding that the sales of machineries and conveyers manufactured by the applicant to an electrical undertaking against Form 'C ' under Entry 5 of the Government Notification issued under section 49 of the Gujarat Sales Tax Act, 1969 resulted in the breach of the declarations in Form 19 as the goods so manufactured and sold did not amount to manufacture of taxable goods ?" It is seen from the two questions referred to above that they are substantially the same. The High Court answered the said questions in favour of the Revenue and against the assessees by two separate orders following its earlier decision in M/s. Nawroji N. Vakil & Co. vs State of Gujarat. The appellants have filed these appeals against the decision of the High Court by special leave under Article 136 of the Constitution. We shall now briefly refer to the relevant provisions of the Act. Section 2(10) of the Act defines a 'dealer ' as any person who 439 buys or sells goods in connection with his business and when he obtains a certificate of registration he becomes a registered dealer. Section 32 of the Act provides for the recognition of a registered dealer. It says that where during the previous or current year, the value of all taxable goods manufactured for sale by a dealer registered under section 29 or by a dealer registered under section 30, whose turnover of sales or purchases has subsequently, exceeded the limits specified in sub section (4) of section 3, exceeds Rs. 3,000/ such dealer on application by him may be granted recognition by the Commissioner and on such recognition being granted, he becomes a recognised dealer. Section S of the Act says that subject to the conditions or exceptions (if any) set out against each of the goods specified in column 3 of the Schedule I to the Act, no tax shall be payable on the sales or purchases of any goods specified in that Schedule. Section 6 of the Act provides that subject to the provisions of the Act and to any rules made thereunder there shall be paid by every dealer who is liable to pay tax under the Act, the tax or taxes leviable in accordance with the provisions of Chapter II of the Act. Tn order to ensure that as far as possible the incidence of tax under the Act is not felt at more than one point in the series of transactions of sales and purchases of goods other than declared good in the State of Gujarat, sections 7, 8 and 10 of the Act are enacted as follows: "7. Levy of sales tax on goods in Schedule II, Part A. There shall be levied a sales tax on the turnover of sales of goods specified in Part A of Schedule II at the rate set out against each of them in column 3 thereof, but after deducting from such turnover, (i) resale of goods on the purchase of which the dealer is liable to pay purchase tax under sec. (ii) resales of goods purchased by him from a Registered dealer (iii) sales of goods, of resales of goods to which clauses (i) and (ii) do not apply, to a Recognised dealer or to a Commission agent holding a permit who purchases on behalf of a principal who is a Recognised dealer, upon such dealer or Commission agent, as the case may be, furnishing in the circumstances and subject to the conditions specified in sub clause (B) and item (ii) of sub clause (C) of 440 sub see. (1) of sec. 13, a certificate as provided therein, and (iv) sales of goods or resales of goods to which clauses (i) and (ii) do not apply, to a Licensed dealer or to a Commission agent holding a permit who purchases on behalf of a principal who is a Licensed dealer, upon such dealer or Commission agent, as the ease may be; furnishing in the circumstances and subject to the conditions specified in item (i) of sub clause (A) and item (i) (a) of sub clause (C) of sub sec. (I) of sec. 13, a certificate as provided therein. Levy of general sales tax on goods in Schedule II Part B There shall be levied a general sales tax on the turnover of sales of goods specified in Part of Schedule II at the rate set out against each of them in column 3 thereof, but after deducting from such turnover, (i) resales of goods on the purchase of which the dealer is liable to pay purchase tax under see. 16; (ii) resales of goods purchased from a Registered dealer by a dealer who is not a Licensed dealer at the time of such purchase, and (iii) sales of goods, or resales of goods to which clauses (i) and (ii) do not apply, to a Licensed dealer, Recognised dealer or to a Commission agent holding a permit, who purchases on behalf of a principal who is a Licensed dealer or a Recognised dealer, upon such dealer or Commission agent as the ease may be furnishing, in the circumstances and subject to the conditions specified in see. 13, a certificate as provided therein. " " 10. Levy of sales tax and general sales tax on goods specified in Schedule III. (I) There shall be levied a sales tax on the turnover of sales of goods specified in Schedule III at the rate set out against each of such goods in column 3 thereof, but after deducting from such turnover, (i) resales of goods on the purchase of which the dealer is liable to pay purchase tax under see. 16, 441 (ii) resales of goods purchased by him from a Registered dealer, (iii)sales of goods. Or resales of goods to which clauses (i) and (ii) do not apply, to a Recognised dealer or to a Commission agent holding a permit who purchases on behalf of a principal who is a Recognised dealer, upon such dealer or Commission agent, as the case may be, furnishing in the circumstances and subject to the conditions specified in sub clause (B) and item (ii) of sub clause (C) of sub sec. (1) of sec 13, a certificate as provided therein, and C (iv) sales of goods or resales of goods to which clauses (i) and (ii) do not apply, to a Licensed dealer or to a Commission agent holdings permit who purchases on behalf of a principal who is a Licensed dealer, upon such dealer or Commission agent as the case may be, furnishing in the circumstances and subject to the conditions specified in item (i) of sub clause (A) and item (i) (a) of sub clause (C) of sub sec. (1) of sec. 13, a certificate as provided therein. (2) There shall be levied a general sales tax on the turnover of sales of goods specified in Schedule III at the rate set out against each of such goods in column 4 thereof, but after deducting from such turnover (i) resales of goods purchased from a Registered dealer, by a dealer who is not a Licensed dealer at the time of such purchase; and (ii) sales of goods, or resales of goods which clause (i) does not apply to a Licensed dealer, or Recognised dealer or a Commission agent holding a Permit who purchases on behalf of a principal who is a Licensed dealer or a Recognised dealer upon such dealer or Commission agent, as the case may be, furnishing in the circumstances and subject to the conditions specified in sec. 13 a certificate as provided therein. " 442 It may be noted that in the above provisions that from the turnover of sales of goods of a dealer which are otherwise taxable, the turnover of goods sold to a Recognised dealer, upon such Recognised dealer furnishing in the circumstances and subject to the conditions specified in sub clause (B) of sub section (1) of section 13 of the Act a certificate as provided therein becomes deductible and no tax is payable on such sales in favour of the Recognised dealer. The relevant part of section 13 of the Act reads thus: "13. No deduction from turnover except on a certificate. (1) There shall not be deducted from the turnover of sales, sales of goods to a Licensed dealer, Recognised dealer or to a Commission agent holding a permit purchasing on behalf of his principal, as provided in sections 7, 8 and 10 unless (A). (B) The Recognised dealer certifies in the prescribed form, that the goods other than prohibited goods sold to him are goods purchased by him for use by him as raw or processing materials or as consumable stores in the manufacture of taxable goods for sale by him; or Rule 24(4) of the Rules prescribes that the certificate issued by a Recognised dealer shall be in Form No. 19. The relevant part of Form No. 19 reads: ". and that the goods purchased by me/the said . . and specified in bill/cash memo/invoice No . dated. . of M/s. . address. . will be used by me/the said. as raw/or processing materials or consumable stores in the manufacture of taxable goods viz. . for sale by me/the said. . and that such sale shall not take place outside the State of Gujarat. (Emphasis supplied)" The expression 'taxable goods ' is defined by section 3(33) of the Act thus: "2(33). "taxable goods" means goods other than those on the sale or purchase of which no tax is payable under sec. 5 or sec. 49 or a notification issued thereunder. " 443 Sub section (1) of section 49 provides that subject to the conditions or exemptions. if any, specified in relation to them, the classes of sales or purchases referred in clauses (i) to (vii) of section 49(1) shall be exempt from the payment of the whole of tax payable under the provisions of the Act. Sub section 2 of section 49 of the Act authorises the State Government to exempt any other specified class of sales by a notification published in the Official Gazette. Section 49(2) reads: "49. Exemptions (1) (2) Subject to such conditions as it may impose, the State Government may, if it considers it necessary so to do in the public interest, by notification in the Official Gazette, exempt any specified class of sales or purchases from payment of the whole or any tax payable under the provisions of this Act. ' By a notification dated April 29, 1970 issued under section 49(2) of the Act the State Government exempted the entire tax payable on sales of goods (other than prohibited goods) by a registered dealer to an electrical undertaking, certified for the purpose by the Commissioner, if the electrical undertaking furnished to the selling dealer a certificate in Form appended to the notification stating inter alia that the goods purchased were required for the use of the generation or distribution of electrical energy by the undertaking. In view of the above notification the sales made to the electrical undertaking become exempt from payment of sales tax under the Act on the undertaking furnishing the required certificate and no tax was paid by the appellants in these two appeals on sales of goods effected by them in favour of the electrical undertaking. It is now necessary to refer to section 16 of the Act, the relevant part of which reads : "16. Liability to purchase tax for contravention of terms of certificate etc. (1) Where any dealer or Commission agent has purchased any taxable goods under a certificate given by him under section 12 or 13, and (a) contrary to such certificate, the goods are used for another purpose, or are not resold or despatched in the manner and within the period certified, or 444 (b) on the resales in the course of inter State trade or commerce, of the goods so purchased, no tax under the (LXXIV of 1956), is actually payable by him on account of any deduction admissible under any of the Provisions of the said Act. then such dealer or Commission agent shall be liable to pay tax on the purchase price of the goods purchased under such certificate; and accordingly, he shall include the purchase price thereof in his turnover of purchases in his declaration or return under section 40 which he is to furnish next thereafter. (2) . . (3) the purchase tax leviable under this section in respect of any goods specified in Schedule II or III shall be the aggregate of all taxes which would have been leviable thereon but for the certificate given under section 12 or 13. (4) If any question arises whether the purchase price of goods purchased under a certificate given under section 12 or 13 is not liable to be included in the turnover of purchases of a dealer or Commission agent under this section, the burden of so proving shall be upon such dealer, or as the case may be, the Commission agent. " Section 16 of the Act provides that where a dealer has purchased any taxable goods under a certificate given by him under section 13 and has used the goods for a different purpose contrary to such certificate, then such dealer shall be liable to pay tax on the purchase price of the goods purchased under such certificate and his liability has to be computed in the manner stated in that section. It is this liability of the appellants that is in dispute in these appeals. It is not disputed that the appellants are recognised dealers; that they had purchased raw materials which were taxable goods (other than prohibited goods) from registered dealers against certificates issued by them in Form No. 19; that no sales tax had been paid on sales in their favour; that they had manufactured goods by using the said raw materials that they had sold a part of the goods to an electrical undertaking notified under section 49(2) of the Act and that no tax had been paid on sales effected by them in 445 favour of the electrical undertaking. It is also not disputed that in Form No. 19 the appellants had stated that the raw materials purchased by them would be used to manufacture taxable goods which would be sold inside the State of Gujarat. The question for consideration is whether the appellants had used the raw materials for another purpose contrary to the terms of Form No. 19. The contention of the Department is that the appellants had contravened Form No. 19 by manufacturing goods which were not 'taxable goods ' and hence were liable to pay purchase tax on the purchase of raw materials under section 16 of the Act and the contention of the appellants is that the goods manufactured and sold by them to the electrical undertakings were 'taxable goods ' and merely because they were sold to an electrical undertaking under transactions exempted by section 49(2) of the Act, the goods did not cease to be taxable goods. The solution to the question, therefore, lies on the true meaning of the expression 'taxable goods '. Relying upon the decision of this Court in the Stale of Tamil Nadu vs M.K. Kandaswami and Ors. it is urged on behalf of the appellants that the expressions 'taxable persons ', 'taxable goods ' and 'taxable events ' are entirely different concepts in sales tax law; that the goods in question were taxable goods as any sale of those goods not covered by section 49(1) and (2) would make such sale taxable and that section 49(1) and (2) of the Act referred to only events which resulted in the exemption from payment of sales tax. It is further argued that all goods the sale or purchase of which is liable to tax under the Act are taxable goods and that goods would not be taxable goods only when their sales are exempted generally from payment of tax as provided in section 5 of the Act. It is, therefore, contended that the goods manufactured by the appellants not having been goods, the sale or purchase of which had been exempted from tax by inclusion in Schedule I to the Act, the appellants could not be treated as having infringed the terms of Form No. 19, notwithstanding the existence of the circumstance that the particular sales made by them to the electrical undertakings were exempt from payment of tax. The second ground urged on behalf of the appellants is that the condition under Form No. 19 became satisfied immediately on the goods being manufactured by the appellants as at that stage the goods were really taxable and that a subsequent event of sale to the electrical undertaking cannot be considered as having violated the said condition. The third ground urged by the appel 446 lants is that a transaction of sale involved two facets a sale and a purchase and if a sale is exempted from tax, it cannot be said the purchase is also exempted. On the above footing it is contended that since under section 49(2) only the tax on sale is exempted and nothing is said about the liability of the purchaser to tax, it cannot be said that the goods which were otherwise taxable had become non taxable on being sold under a transaction which attracted section 49(2) of the Act. We find no substance in any of the three grounds urged on behalf of the appellants for the reason that the present case is governed by the definition of the expression 'taxable goods ' in section 2(33) of the Act. It is interesting to note that the Bombay Sales Tax Act, 1959 (Bombay Act No. 1 of 1959) which was in force in the State of Gujarat before the Act came into force and which was repealed by section 88 of the Act contained the definition of the expression 'taxable goods ' in section 2(33) thereof. The expression 'taxable goods ' was defined in the Bombay Act as 'goods other than those on the sale or purchase of which no tax is payable under section 5 '. In the Bombay Act there was also a provision corresponding to section 49 of the Act in section 41 thereof which empowered the State Government subject to such conditions as it may impose to exempt by a notification published in the Official Gazette any specified class of sales or purchases from payment of the whole or any part of any tax payable thereunder if the State Government was satisfied that it was necessary so to do in the public interest. Still the definition of 'taxable goods ' in that Act did not refer to sales exempted under section 41 thereof. But in the Act which repealed and replaced the Bombay Act the meaning of the expression 'taxable goods ' has been narrowed down as section 2(33) of the Act reads 'taxable goods ' means goods other than those on the sale or purchase of which no tax is payable under section 5 (which corresponds to section 5 of the Bombay Act) and section 49 of the Act (which corresponds to section 41 of the Bombay Act) or a notification issued thereunder. By this definition, the dichotomy that is stated to exist between 'taxable goods ' and 'taxable events ' has been given a go by. It may be that section 5 and Schedule I refer to goods only but section 49 deals with only taxable events which result in the exemption from payment of tax on the conditions mentioned therein or in the notification issued thereunder being satisfied even though the goods in question do not come under Schedule I. Secondly one has to wait till the disposal of the goods by the dealer to find out whether the goods are taxable goods or not in view of the 447 definition of the said expression which takes away goods sold under circumstances attracting section 49 from the scope of the meaning of that expression. Nor does the third ground survive for the very same reason. If the sale is exempt from tax under section 49 of the Act, the goods sold would not be taxable goods. We need not go into the question whether the purchaser in a sale under section 49 of the Act has to pay tax in these cases. This reason also disposes of an allied argument of the appellants that the possibility of any liability arising under section 50 of the Act on the breach of any condition imposed by section 49 or the notification issued thereunder would absolve the appellants of their liability to pay the tax under section 16 of the Act. Any such levy made under section 50 has not been shown to have any effect in law on the liability of the appellants under section 16. The scheme of the Act appears to be that sales tax should be levied on goods which are not included in Schedule I at least once inside the State in the series of sales and purchases even though they may have been converted into manufactured goods and that is why Form No. 19 requires the purchaser to state that the goods will be used by him as raw or processing materials or as consumable stores in the manufacture of taxable goods for sale by him inside the State and section 16 of the Act provides that where any dealer has purchased any taxable goods under a certificate given by him under section 12 or section 13 of the Act and contrary to such certificate the goods are used for another purpose or are not resold or despatched in the manner and within the period certified or on the resales in the course of inter State trade or commerce, of the goods so purchased no tax under the is actually payable by him on account of any deductions admissible under any of the provisions of that Act, then such dealer shall be liable to pay tax on the purchase price of the goods purchased under such certificate. The deliberate alteration of the definition of 'taxable goods ' in the Act also is attributable to the said intention of the State legislature. The appellants also cannot derive any assistance from the decision of this Court in Polestar Electronic (Pvt.) Ltd. vs Additional Commissioner, Sales Tax and Anr. as these cases are governed by 448 the provisions of the Act and as there appears to be no similarity between the facts of these appeals and the facts involved in that case. For the foregoing reasons, we do not find any merit in these appeals. The appeals are dismissed with costs. Hearing fee one set.

Exercising power under section 49(2) of the Gujarat Sales Tax Act, 1969, the State Government exempted the entire tax payable on sale of goods (other than prohibited goods) by a registered dealer to an electrical undertaking, certified for the purposes by the Commissioner; if the electrical undertaking, furnished to the selling dealer a certificate in the requisite form that the goods purchased were required for the generation or distribution of electricity by the undertaking. But according to section 16 or the Act where a dealer has purchased any taxable goods under a certificate given by him under section 13 and has used the goods for a purpose contrary to such certificate, such dealer becomes liable to pay tax on the purchase price of the goods. The appellants who were recognised dealers purchased raw materials of taxable goods from registered dealers by furnishing a certificate in Form 19 by reason of which no sales tax had been paid by them. After manufacturing the goods with raw materials,, they sold part of the manufactured goods to an electrical undertaking in the State against 'C ' forms to claim exemption from tax on them by virtue of a notification issued under section 49(2) of the Act. No tax had been paid on sales effected by them in favour of the electrical undertaking. On the ground that the undertaking furnished in form 19 had been violated, the Sales Tax officer levied purchase tax under section 16 on the raw materials purchased by the appellants. The appellants were unsuccessful in their appeals before the Assistant Commissioner as well as before the Sales Tax Tribunal. The High Court answered the references against the assessees and in favour of the Revenue. It was contended on behalf of the appellants (1) that the goods manufactured by them not having been goods the sale or purchase of which had been exempted from tax by inclusion in Schedule I they could not be treated as having infringed the terms of Form No. 19 notwithstanding the fact that particular sales made by them to the electrical undertaking were exempted from payment of tax (2) the condition in form 19 became satisfied immediately on the 436 goods being manufactured by the appellants as at that stage the goods were really taxable and that a subsequent event of sale to the electrical undertaking could not be considered as a violation of the said condition and (3) in a transaction of sale if the sale was exempted from tax it could not be said that the purchase was also exempted. Dismissing the appeal, ^ HELD: (1) The expression "taxable goods '. defined in section 2(33) of the Act means goods other than those on the sales or purchase of which no tax is payable under section 5 and section 49 or a notification issued thereunder. By this definition the dichotomy that existed between "taxable goods" and "taxable events" in the now repealed Act (The Bombay Sales Tax Act, 1959 which was in force in the State before the present Act) had been given a go by. It may be that section 5 and Schedule I refer to goods only but section 49 deals with only taxable events which result in the exemption from payment of tax on the happening of the conditions mentioned therein or in the notification even though the good in question do not come under Schedule 1. [446 F H] (2) To find out whether the goods are taxable goods or not one has to wait till the disposal of the goods by the dealer in view of the definition of the said expression which takes away goods sold under circumstances attracting section 49 from the scope of the meaning of that expression. [447 A] (3) If the sale is exempt from tax under section 49 the goods sold would not be taxable good. [447 B]

Civil Appeal Nos. 2120 & 2125 of 1970. From the Judgment and order dated the 17th April, 1970 of the Delhi High Court in Civil Writ Petitions Nos. 133 & 134 of 1968 Kapil Sibal, Rameshwar Dial, Adarsh Dial and section Mittar for the Appellants. K. B. Rohtagi for the Respondents. The following Judgment of the Court was delivered by CHINNAPPA REDDY, J. BY a notification dated 31.1.68, the Delhi Municipal Corporation purported to enhance the fee for slaughtering animals in its slaughter houses from Re. 00.25p to Rs. 2.00 for each animal, in the case of sheep, goats and pigs, and li from Re. 1.00 to Rs. 8.00 for each animal, in the case of buffaloes. The notification was quashed by the High Court of Delhi on the ground that the Corporation was really proposing to levy a tax under the guise of enhancing the fee. The original rates were fixed in March 1953 and the revised rates were to take effect from February 1, 1968. Some butchers of the city questioned the revision of rates on the ground that the proposed enhanced fee was wholly disproportionate to the cost of the services and supervision and was in fact not a fee, but a tax. The High Court accepted the contention of the butchers on what appears to us a superficial view of the facts and principles. Fortunately, the High Court has certified the case as a fit one for appeal under article 133 (1)(c) of the Constitution and the matter is now before us. 1002 During the pendency of the writ petitions in the High Court, by virtue of an interim arrangement, the Municipal Corporation was permitted to collect fee at the rate of Re. 00.50p. per animal in the case of sheep, goats and pigs and Rs. 2.00 per animal in the case of buffaloes. As a result, the Municipal Corporation realised a sum of Rs. 4,24,494 by way of fee for slaughtering animals in its slaughter houses. Now, the budget of the Municipal Corporation under item XIV B showed a sum of Rs. 2,56,000 as the expenditure involved in connection with the slaughter houses. Comparing the amount of actual realisation of fee at the rates permitted by the Court with the amount of expenditure as revealed by the budget and excluding from consideration all expenditure not show in the budget under item XIV B, the High Court came to the conclusion that even if the original fee was doubled the amount realised would be more than sufficient to meet the expenditure involved and there was, therefore, no warrant at all for increasing the fee eight fold. So, it was said, the proposed fee was no fee but a tax for which there was no legislative mandate. We shall presently point out the error into which the High Court fell on facts as well as principle. A word on interpretation. Vicissitudes of time and necessitude, of history contribute to changes of philosophical attitudes, concepts, ideas and ideals and, with them, the meanings of words and phrases and the language itself. The philosophy and the language of the law are no exceptions. Words and phrases take colour and character from the context and the times and speak differently in different contexts and times. And, it is worthwhile remembering that word, and phrases have not only a meaning but also a content, a living content which breathes, and so, expands and contracts. This is particularly so where the words and phrases properly belong to other disciplines. 'Tax ' and 'Fee ' are such words. They properly belong to the world of Public Finance but since the Constitution and the laws are also concerned with Public Finance, these words have often been adjudicated upon in an effect to discover their content. Commissioner of Hindu Religious Endowments, Madras vs Shri Lakshmindra Thirtha Swamiyar(1) is considered the locus classicus on the subject of the contradistinction between 'tax ' and fee?. The definition of 'tax ' given by Latham, C.J. as "a compulsory exaction 1003 of money by public authority for public purposes enforceable by law and not payment for services rendered" was accepted, by the Court as stating the essential characteristics of a tax. Turning to fees, it was said "a fee is generally defined to be a charge for a special service rendered to individuals by some governmental agency", but it was confessed, "as there may be various kinds of fee, it is not possible to formulate a definition that would be applicable to all cases". As regards the distinction between a tax and a fee, it was noticed that compulsion could not be made the sole or even a material criterion for distinguishing a tax from fee. It was observed that the distinction between a tax and fee lay primarily in the fact that tax was levied as a part of a common burden, while a fee was a payment for a special benefit or privilege. But it was noticed that the special benefit or advantage might be secondary to the primary motive of regulation in the public interest, as for instance in the case of registration fees for documents or marriage licences. It was further noticed that Article 110 of the Constitution appeared to indicate two classes of cases where 'fees ' could be imposed: (1) where the government simply granted a permission on privilege to a person to do something which otherwise that person would not be competent to do and extracted from him, in return, heavy or moderate fees (ii) where the government did some positive work for the benefit of the person and money was taken as a return for the work done or services rendered, such money not being merged in the public revenues for the benefit of the general public. It was however made clear that the circumstance that all the collections went to the Consolidated Fund of the State and not to a separate fund may not be conclusive. The Court finally observed that there was really no generic difference between the tax fees though the Constitution had, for legislative purposes, made a distinction between a tax and a fee. While there were entries in the legislative lists with regard to various forms of taxes, there was an entry at the end of each one of the three lists as regards fees which could be levied in respect of any of matters that was included in it. The implication seemed to be that fee had special reference to governmental action undertaken in respect to any of those matters. In HH Sudhandra vs Commissioner for Hindu Religious & Charitable Endowments(1), the Court reiterated the principle that a levy in 1004 the nature of a fee did not cease to be of that character merely because there was any element of compulsion or coerciveness present in it, and aided. "Nor is it a postulate of a fee that it must have direct relation to the actual services rendered by the authority to individual who obtains the benefit of the service. If with a view to provide a specific service, levy is imposed by law and expenses for maintaining the service are met out of the amounts collected there being a reasonable relation between the levy and the expenses incurred for rendering services, the levy would be in the nature of a fee and not in the nature of a tax . . but a levy will not be regarded as a tax merely because of the absence of unity in its incidence, or because of compulsion in the collection thereof, nor because some of the contributories do not obtain the same degree of service as others may. " In Hingir Rampur Coal Co. Ltd. & Ors. vs The State of Orissa and Ors.(1) the Court while reiterating that there was an element of quid pro quo between the person paying the fee and the authority imposing it, said: "If specific services are rendered to a specific area or to a specific class of persons or trade or business in any local area, and as a condition precedent for the said services or in return for them cess is levied against the said area or the said class of persons or trade or business, the cess is distinguishable from a tax and is described as a fee." Later it was said: "It is true that when the legislature levies a fee for rendering specific services to a specified area or to specified, class of persons or trade or business, in the last analysis such services may indirectly form part of services to the public in general. If the special service rendered is distinctly and primarily meant for the benefit of a specified class or area the fact that in ben fitting the specified class or area the State as a whole may 1005 ultimately and indirectly be benefitted would not detract from the character of the levy as a fee. Where, however, the specific, service is indistinguishable from public service, and in essence is directly a part of it, different considerations may arise. In such a case, it is necessary to enquire what is the primary object of the levy and the essential purpose which it is intended to achieve. Its primary object and the essential purpose must be distinguished from its ultimate or incidental results or consequences. That is the true test in determining the character of the levy," In H.H. Swamiji vs Commissioner, Hindu Religious & Charitable Endowments Department and Ors.,(1) Chandrachud, CJ. speaking for the Constitution Bench, emphasised the necessity as well as the sufficiency of a broad correlationship between the services rendered and the fees charged and discounted the attempts to go into minutiae to discover meticulously whether or not there was mathematical equality. He said, "For the purpose of finding whether there is a correlationship between the services rendered to the fee payers and the fees charged to them, it is necessary to know the cost incurred for organising and rendering the services. But matters involving consideration of such a correlationship are not required to be proved by a mathematical formula. What has to be seen is whether there is a fair correspondence between the fee charged and the cost of services rendered to the fee payers as a class. The further and better particulars asked for by the appellants under VI, rule 5 of the Civil Procedure Code, would have driven the Court, had the particulars been supplied, to a laborious and fruitless inquiry into minute details of the Commissioner 's departmental budget. A vivisection of the amounts spent by the Commissioner 's establishment at different places for various purposes and the ad hoc allocation by the Court of different amounts to different heads would at best have been speculative. It would have been no more possible for the High Court if the information were before it, than it would be possible for us if the information were before us. to find out what part of the expenses incurred by the Commissioner 's establishment at various places and what part of the salary of his staff at those places should be allocated to the functions 1006 discharged by the establishment in connection with the services rendered to the appellants. We do not therefore think that any substantial prejudice has been caused to the appellants by reason of the non supply of the information sought by them." In Southern Pharmaceuticals & Chemicals Trichur & Ors. etc. vs State of Kerala & Ors. etc. ,(1) A.P.Sen, J. speaking for the Court noticed the broadening of the Court 's attitude and observed: "It is now increasingly realised that merely because the collections for the services rendered or grant of a privilege or licence, are taken to the consolidated fund of the State and are not separately appropriated towards the expenditure for rendering the services is not by itself decisive. That is because the Constitution did not con template it to be an essential element of a fee that it should be credited to a separate fund and not to the consolidated fund. It is also increasingly realised that the element of quid pro quo stricto senso is not always a sine qua non of a fee. It is needle to streess that the element of quid pro quo is not necessarily absent in every tax. . The Traditional Concept of Quid Pro Quo Is Undergoing. A Transformation. " What do we learn from these precedents? We learn that is no generic difference between a tax and a fee, though broadly a tax is a compulsory exaction as part of a common burden, without promise of any special advantages to classes of taxpayers whereas a fee is a payment for services rendered, benefit provided or privilege conferred '. Compulsion is not the hall mark of the distinction between a tax and a fee. That the money collected does not go into a separate fund but goes into the consolidated fund does not also necessarily make a levy a tax. Though a fee must have relation to the services rendered, or the advantages conferred, such relation need not be direct . a mere causal relation may be enough. Further, neither the incidence of the fee nor the service rendered need be uniform. That others besides those paying the fees are also benefited does not detract from the character of the fee. In fact the special benefit or advantage to the payers of the fees may even be secondary as com 1007 pared with the primary motive of regulation in the public interest. Nor is the Court to assume the role of a cost accountant. It is neither necessary nor expedient to weigh too meticulously the cost of the services rendered etc. against the amount of fees collected so as to evenly balance the two. A broad correlationship is all that is necessary. Quid pro quo in the strict sense is not the one and only true index of a fee; nor is it necessarily absent in a tax. What do we have in the present case ? True, the Municipal Corporation has realised a sum of Rs. 4,24,494 by way of fees at the rate of Re. 00.50p. per animal in the case of sheep, goats and pigs and Rs. 2.00 per animal in the case of buffaloes, whereas the budget of the Municipal Corporation showed under item XIV B that an amount of Rs. 2,56,000 was expended in connection with slaughter houses. But as explained in the affidavit of Dr. A. C. Ajwani Deputy Health officer (Public Health) of the Municipal Corporation of Delhi, the amount of Rs. 2,56,000 covers only those items of expenditure as are reflected in item XIV B of the Municipal Budget. The items of expenditure covered by item XIV B of the municipal budget are evidently those item of expenditure which arc incurred directly and excessively in connection with slaughter houses. In addition there are several other items of expenditure connected with slaughter houses but which are not included in item XIV B. To name a few, . there is the expenditure involved in the purchase, maintainance and the use of trucks and other vehicles for the removal of filth and refuse from slaughter houses. These expenses, though attributable to slaughter houses, are debited in the municipal budget under other heads such as transport, conservancy, petrol and oil etc. There is also the expenditure incurred in connection with the maintainance of supervisory staff like a full time Veterinary officer, and a Municipal Health officer, Deputy Health officer, Zonal Health officer etc., a considerable part of those duties are connected with slaughter houses. There is then the cost of depreciation of the buildings and fittings in the slaughter houses. There is also the provision for expansion and improvement of slaughter house facilities. There are several other items of expenditure the whole or part of which is attributable to slaughter houses. Unfortunately, the High Court refused to look at any of these formidable items of expenditure on the ground that the Corporation could not ask the Court to look at any figures other than the figure mentioned under item XIV B of the municipal budget. Aparently the High Court was under the impression that the fees collected should be shown to be related to 1008 expenditure incurred directly and exclusively in connection with the slaughtering of animals in its slaughter houses and also, shown as such in the municipal budget. This was a wholly erroneous approach, in the light of what we have said earlier. We have explained earlier that the expenditure need not be incurred directly nor even primarily in connection with the special benefit or advantage conferred. We have also explained that there need not be any fastidious balancing of the cost of the services rendered with the fees collected. It appears to have been common ground before the High Court that the price of meat had gone up about 10 to 12 times since the rates were original fixed. If so, one wonders how the Municipal Corporation could be expected to effectively discharge its obligations in connection with the supervision of the slaughtering of animals in the slaughter houses maintained by it by merely raising the rates two fold and three fold. The increase from Re. 00.25p to Rs. 2.00 per animal in the case of small animals and from Re. 1.00 to Rs. 8.00 in the case of large animals appears to us to be wholly justified in the circumstances of the case. The appeal is therefore, allowed with costs the judgment of the High Court set aside and the Writ Petition filed in the High Court dismissed with costs. S.R. Appeal allowed.

As per the rates fixed in the year 1953 by the Municipal Corporation of Delhi, the slaughtering fees were 0.25 paise for each animal, in the case of sheep, goats and pigs and rupees one for each animal in the case of buffaloes. By a Notification dated 31.1.1968, the Corporation purported to enhance the slaughtering fee in both the categories eightfold, with effect from February 1 1968. Some butchers of the city questioned the revision of rates on the ground that the proposed enhanced fee was wholly disproportionate to the cost of the services and supervision and was in fact not a fee, but a tax. During the pendency of the writ petitions in the High Court, by virtue of an interim arrangement, the appellant, was permitted to collect slaughtering fees at double the rates fixed in 1953 and as a result thereof the Corporation realised a sum of Rs. 4,24,494/ . The budget of the Corporation under item XIV B showed a sum of Rs. 2,56,000 as the expenditure involved in connection with the slaughter houses. Comparing the amount of actual realisation of fee at the rates permitted by the court with the amount of expenditure as revealed by the budget and excluding from consideration all expenditure not shown in the budget from item XIV B, the High Court came to the conclusion that even if the original fee was doubled the amount realised would be more than sufficient to meet the expenditure involved and, therefore, there was no reason at all for increasing the fee eightfold and so the proposed fee was no fee but a tax for which there is no legislative mandate. Hence the appeal by special leave. Allowing the appeal, the Court ^ HELD: 1;1 The increase of the slaughtering fee from 0.25 P to Rs. 2.00 per animal in the case of small animals and from rupee 1.00 to Rs. 8.00 in the case of large animals was wholly justified, in the Circumstances of the case. [1008 C D] 1:2 True, the Municipal Corporation has realised a sum of Rs. 4,24,494 way of fees at the rate of Re. 00.50 per animal in the case of sheep, goats 1000 and pigs and Rs. 2 per animal in the case of buffaloes, whereas the budget of the M.C.D. showed under item XIV B that an amount of Rs. 2,56,000 was expended in connection with slaughter houses. The Items of expenditure covered by item XIV B of the Municipal Budget are evidently those items of expenditure which are incurred directly and exclusively in connection with slaughter houses. There are several other items of expenditure the whole or part of which is attributable to slaughter houses like the expenditure involved in the purchase, maintenance and the use of trucks and other vehicles for the removal of filth from slaughter houses, conservancy, petrol oil etc. , the expenditure incurred in connection with the maintenance of supervisory staff like a fulltime Veterinary officer, Municipal Health officer, Deputy Health officer and Zonal Head officers, the cost of depreciation of the buildings and fittings in slaughter houses, expansion and improvement of slaughter houses for utilities etc. but actually debited to other heads of account under the Municipal budget. Apparently, the High Court was under an erroneous impression that the fees collected should be shown to be related to expenditure incurred directly and exclusively in connection with the slaughtering of animals in its slaughter houses and also, shown as such in the Municipal budget. [1007 B H, 1008 A B] 2. Vicissitudes of time and necessitudes of history contribute to changes of philosophical attitudes, concepts, ideas and ideals and, with them, the meanings of words and phrases and the language itself. The philosophy and the language of the law are no exceptions. Words and phrases take colour and character from the context and the times and speak differently in different contexts and times. Words and phrases have not only a meaning but also a content, a living content, which breathes, and so, expands and contracts. This is particularly so where the words and phrases properly belong to other disciplines. "Tax" and "Pee" are such words. They properly belong to the world of public finance but since the Constitution and the laws are also concerned with Public Finance, these words have often been adjudicated upon in an effort to discern their content. [1002 D G] 3. From the decided cases beginning from Commissioner of Hindu Religious Endowments, Madras vs Shri Lakshmindra Thirtha Swamiyar ; till date, it is clear that: (i) There is no generic difference between a tax and fee, though broadly a tax is a compulsory exaction as part of a common burden, without promise of any special advantages to classes of tax payers whereas a fee is a payment for services rendered; benefit provided or privilege conferred; (ii) Compulsion is not the hall mark of the distinction between a tax and fee; (iii) That the money collected does not go into a separate fund but goes into the Consolidated Fund does not also necessarily make a levy tax; (iv) Though a fee must have relation to the services rendered, or the advantage conferred, such relation need not be direct; a mere casual relation may be enough; (v) Further neither the incidence of the fee nor the service rendered need be uniform, (vi) That others besides those paying the fees are also benefited does not detract from the character of the fee; (vii) In fact the special benefit or advantage to the payers of the fees may even be secondary as compared with the primary motive of regulation in the public interest; (viii) Nor is the court to assume the role of a Cost Accountant. It is neither necessary nor expedient to weigh too meticulously the cost, of the services rendered 1001 etc. against the amount of fees collected so as to evenly balance the two and (ix) A correlationship is all that is necessary. Quid pro quo in the strict sense is not the only true index of a fee; nor is it necessarily absent in a tax. [1006 E H, 1007 A B] Commissioner of H.R. & C.E., Madras vs Shri Lakshmindra Thritha Swamiyar, ; ; H. H. Sudhundra vs Commissioner for Hindu Religious and Charitable Endowments, [1963] Supp. 2 S.C.R. 302; Hingir Rampur Coal Co. Ltd. and others vs The State of Orissa and others, [196] 2 S.C.R. 537; H. H. Swamiji vs Commissioner Hindu Religious & Chariiable Endowments Dept. and others, ; Southern Pharmaceuticals & Chemicals, Trichur and others etc. vs State of Kerala and others; , referred to.

N: Criminal appeal No. 512 of 1979. From the Judgement and Order Dated 18.7.1979 of the Allahabad High Court Crl. A No. 564 of 1974. U.R. Lalit, Sobhag Mal Jain, Sudhanshu Atreya, Ms. P. Jain and S.K. Jain for the Appellants. Vijay Bahuguna, Prashant Chaudhary and D. Bhandari (NP) for the Respondent. The Judgement of the Court was delivered by V.RAMASWAMI, J. The four appellants along with 15 others were charged for offences punishable under Section 302 read with section 149 and also section 201 read with section 149 and section 147 and 148 of the Indian Penal Code. The charges were that they were members of an unlawful assembly, in prosecution of the common object of namely to deter Ram Sewak (PW2), from filing the nomination paper for the post of Pradhan Gaon Sabha Tikhra and to commit the murder of his associates including one Gajendra Singh Yadav (deceased), a resident of village Bibiapur and in furtherance of that common object did commit the murder of the said Gajendra Singh Yadav and live cartrides belonging to the deceased. They were also charged that in furtherance of the said common objects and knowing that the murder of the said Gajendra Singh was punishable with death or imprisonment for life and caused the evidence of the said offence to disappear by scraping the blood stained earth at the scene of occurrence and burning it and taking away the dead body of Gajendra Singh and thereafter burning it with the intention of screening of evidence. The first Additional District and Sessions Judge, Kheri in Sessions Trial No. 264 of 1973 acquitted all the accused persons of all the charges on the ground that there are many infirmities rendering the prosecution evidence unworthy of belief. The State of Uttar Pradesh preferred Criminal Appeal No. 654 of 1974 before the Lucknow 859 Bench of the Allahabad High Court. The High Court set aside the acquittal of the first appellant Bhupendra Singh (1) and convicted him for offence under section 302 of the Indian Penal Code and sentenced him to a term of life imprisonment. The High Court also set aside the acquittal of the second, third and fourth appellants (A4, 7 and 8) in part, convicted them under section 201, IPC and sentenced them to a term of seven years rigorous imprisonment under that section. The acquittal of the appellants under the remaining charges were confirmed. The High court also acquitted the other 15 appellants of all the charges. The prosecution case was that the deceased and Ram Sewak (PW2) who are residents of village Bibiapur alongwith Tarun Kumar (PW1) son of the deceased, Ram Avtar Yadav (PW3) and their party people came to the village Padarial Tula in a bullock cart on 25.4.1972 for the purpose of filing the nomination papers of Ram Sewak (PW2) for the election of Pradhan of Gaon Sabha. they reached around 10.30 A.M. the Mela Maidan near the compound of school cum temple in village Padaria Tula. They left the bullock cart and the bullocks in a nearby place to the west of the eastern pathway about 50 paces away from the school where the nomination papers had to be filed. Bhupendra Singh, the first accused was also a candidate for the office of Pradhan of Gaon Sabha. He had also come for filing the nomination along with the other accused who were his supporters. On seeing the party of the deceased arrive Bhupendra Singh enquired Ram Sewak (PW2), whether he had come to file nomination paper against him. At that time Gajenddra Singh, deceased intervened and challengingly told the first accused that he should ask him. This resulted in verbal altercation between the first accused and the deceased. The first accused then fired a shot with his rifle at the deceased and on receiving the bullet injury the deceased fell on the ground. The prosecution case further was the six other accused had also guns and they also fired at the deceased. The other accused who were armed with lathis and ballams, physically assaulted the deceased. Thereafter the accused dragged the deceased to a small mound on the west of the scene of occurence and then loaded the dead body on the trolley of a tractor belonging to the first accused, which had been used by the accused to reach at the scene and which driven by the first accused and the deceased was taken away. All the accused got into the trolley and shouting loudly that they are going to burn the body and throw its remains in the water drove the tractor towards the north. PWs 1 to 6 are stated to be eye witnesses to this part of the occurrence. PWs 7,8,9 and 10 are stated to have seen the first accused driving the tractor to 860 which the trolley was attached and the three other appellants and 15 or 16 more people sitting on the tractor and going towards a revolt shouting that they are taking the body of Gajendra Singh and that the will be burnt and thrown into the river. PW 10 Lalji also claimed that he saw the burning of the dead body near the river and the ashes thrown in river suita. Tarun Kumar PW1 son of the deceased went to his village Bibiapur, wrote the report exhibit Ka. 1 and gave the first information report before the Station House Officer Thana Mira which is about 12 miles from the scene of occurrence at 3.30 PM on that day. Rama Nand Tewari (PW17) took up the investigation reached the scene of occurrence at 5.30 P.M. and seized some blood stained earth at a point market `A ' in the plan and also some ashes, besides 55 pellets wads, teeth and some buttons on the spot under Mahazars which were attested by Rajendra Prasad (PW4) and Durga Prasad (PW5) and another. On the 27th of the April, 1972 he interrogated Asharfi (PW7), Chhotanney (PW8), Reoti Prasad (PW9) and Lalji (PW10) and accompanied by them he reached the jungle at the outskirts of village Daulatpur where he found burnt leaves near a Shisham tree. He seized burnt earth, ashes and burnt pieces of bones under recovery memo in the presence of Rajendra Prasad (PW4) and Durga Prasad (PW5). On the 14th of May, 1972 in Village Mudia he interrogated Ram Autar (PW3), Ram Sewak (PW2), Gaua Din (PW6) and others submitted the charge sheet on 4th December, 1972. As already stated the charge against the first appellant was one under section 302 read with section 149, IPC and the Trial Court had acquitted him of that offence. The High Court on appeal by the State while setting aside the acquittal of the first appellant convicted him for the substantive offence under section 302, IPC on the ground that the he was the principal offender; that his shot resulted in death of Gajendra Singh and the other accused persons to whom no specific part has been brought home were entitled to benefit of doubt. The High Court also believed the prosecution case relating to the disposal of body by taking it away from the scene of occurrence and burning it and throwing the ashes in the river but held that PWs 7,8,9 and 10 speak of the appellants alone by name as among the persons in the tractor and trolley and the names of others were not mentioned by them and therefore set aside the acquittal in respect of the offence under section 201 of IPC in so far as the appellants are concerned and convicted them and sentenced them a term of seven years of rigorous imprisonment. The four appellants have filed the above criminal appeal against this conviction and sentence of the High Court. 861 There could be no doubt that an occurrence of type spoken to by the prosecution witnesses had taken place at the Mela Maidan, Padaria Tula, 25.4.1972 was the date fixed for filing nomination papers for the election of Pradhan of the Gaon Sabha comprising Padaria Tula. The place where the nomination papers had to be filed is the school premises at the place. Ramesh Chander Mishra (PW15) the Sub Deputy Inspector of Schools had been authorised to receive the nomination papers. He was assisted by the Gram Sewak Verma (CW1) and Rajendra Prakash (PW14) among others. They had stated in their evidence that they were inside the school premises and that around 10.30 A. M. they heard gun shots near the school. PW2 Ram Sewak as also the first appellant Bhupendra Singh had come there to file their nomination papers along with other party people. The investigating officer had made certain recoveries from the scene of occurrence along with bullock cart and the two bullocks in which the deceased and his party had come to the sense. The evidence of PWs 1 to 6 are also uniform that the occurrence had taken place at that place. We can therefore, safely assume that the incident took place at the Mela Maidan near the compound of School cum temple in Village Padaria Tula as stated by the prosecution. It is true that the pieces of burnt bones recovered from the place where the body was stated to have been burnt were set to the Serologist but he was unable to tender any opinion regarding origin, sex and age. Though, it was contended by the learned counsel for the appellants that the prosecution had not established that any such occurrence had taken place that morning and that Gajendra Singh had fallen the victim in such occurence we are unable to agree with the learned counsel that the occurrence had not taken place at all that Gajendra Singh had not been proved to have been killed. There could be no doubt that corpus delieti could be established by the prosecution through direct evidence and that is what the prosecution had done in this case in the circumstances we are of the view that the prosecution had established that there was an occurence at 10.30 A.M. on 25.4.1972 at the place mentioned by the prosecution in which Gajendra Singh had fallen a victim and died. Mr. Lalit, learned counsel for the appellants took us through the entire evidence and contended that the prosecution had not established the complicity of the first appellant for murder and the appellants for the offence of screening the evidence punishable under section 201, IPC. In the FIR, Tarun Kumar (PW1) had mentioned the names of the four appellants and the presence of PWs 2 to 6 at the scene of 862 occurence. All these eye witnesses had uniformly stated that they saw only Bhupendra Singh firing at the deceased which brought him down to the ground and stated further that immediately on hearing the first shot they ran and hid themselves behind the dilapidated wall of the temple and they had heard only 6 and 7 shots thereafter. They have not attributed over acts to any of the accused other than Bhupendra Singh, the first appellant. It is in those circumstances, the High Court confirmed the acquittal of all the accused other then Bhupendra Singh of the offence under section 302 read with section 149, IPC. PWs 3 to 6 have stated in their evidence that during the course of verbal altercation between the first accused and the deceased, the first accused shot Gajendra Singh with rifle on the fore head. On the basis of that shooting with the rifle on the fore head the first appellant was convicted for the substantial offence of murder under section 392 IPC and sentenced to life imprisonment. In the FIR though Tarun Kumar, PW1 has stated that the first appellant fired at his father first, he had not stated that the bullet hit fore head bringing down its father to the ground. It is stated in the FIR: "Bhupender then, first of all, fired on my father; along with, all other started firing. My father then fell down as a result of attack by fire arms; then others with lathis and ballams started assaulting. From there, I noticed that Bhupender Singh and his companions carried the dead body of my father, along with his gun, in his tractor trolley towards Karmapura." Thus though an overt act had been assigned to the first appellant in the FIR it had not been stated where the bullet shot hit the deceased. It is true that in their oral evidence PWs 3 to 6 have assigned the first shooting to the first appellant but their evidence relating to the shot hitting at the fore head could not be accepted for more than one reason. As already stated, PW1, first went to his village Bibiapur from the scene of occurrence at Padaria Tula, prepared the FIR in his house and then delivered the same at 3.30 P.M. at the Police Station. In spite of time gap and his being with deceased at the time of the occurrence he had not specifically stated that the first aim of the first appellant hit the fore head of the deceased. the names of PWs 2 to 6 are given in the FIR itself. However, PWs 3 and 6 were examined by the Investigating Officer only on 14th of May and no explanation was forthcoming 863 as to why they were not examined earlier. PWs1 and 2 did not say in their oral evidence that the shot aimed by the first appellant hit the fore head of the deceased. PWs 3,4,5 and 6 gave the evidence to the effect that the first rifle shot of the appellant hit the deceased on his fore head. But this part of the statement we are unable to believe because PW1, Tarun Kumar had not confirmed this either in the FIR or in his evidence as PW1. This was also not stated by PW2 in his evidence or during investigation as seen from the evidence of PW17 the investigation officer. PWs 3 and 6 were examined by PW17 only after 20 days i.e. on the 14th of May, 1972 though their names were mentioned in the FIR. In the circumstances the contention of the learned counsel for the appellants that the possibility of an improvement in the case to implicate A 1 for a substantive offence cannot be ruled out. While we could accept the case of the prosecution trying to establish corpus delicti through the evidence of PWs 1 to 6 we could not accept the evidence in so far as it not known where the bullet hit and whether that injury caused by the same and that injury is sufficient to cause death, the offence under section 302 IPC could not be said to have been made out. In the circumstances, therefore, we are unable to agree with the High Court that the first appellant is guilty of offence under section 302 IPC of causing the death of Gajendra Singh. However, we are of the view that while the first appellant shot at the deceased there could be no doubt that either he had the intention to kill him or at least he had the knowledge that the act could cause the death. All the witnesses also say that the shot by A 1 brought down the deceased to the ground. There could, therefore, be no doubt that the shot had caused some hurt or injury could have caused the death. In the circumstances we consider that the offence would come under the second limb or second part of section 307, IPC. Though imprisonment for life also could be awarded as sentence for such an offence on the facts and circumstances we impose a sentence of 10 years rigorous imprisonment. Accordingly we alter the conviction under section 302, IPC as one under section 307 IPC and sentence him to term of 10 years rigorous imprisonment. So far as the offence under section 201 IPC is concerned the 864 prosecution relied upon the evidence of PWs 7,8,9 and 10. The evidence of PWs 7,8 and 9 only go to show that they had seen 15 to 20 people sitting in the trolley of the tractor driven by the first accused. They have referred to the names of the appellants among the 20 people who were in the trolley. However, none of them had stated that they had seen the body of Gajendra Singh alive or dead in the trolley. The prosecution tried to establish that the accused were carrying body of Gajendra Singh in the trolley from the statement of PW7 who said the Chet Ram one of the persons who was travelling in the trolley along with other and who is now dead was saying or shouting that: "Gajender Singh had been killed and he would roasted and eaten and thrown in the river." And the statement of PW3 that: "The people sitting the trolley were talking amongst themselves and uttering the words `today we have killed and brought a lion '" But PWs 7 and 8 had not given any such version to PW17 in their statements during investigation. PW 9 turned hostile and his evidence is also worth nothing. PW 10 had stated that Chet Ram said: "We have killed Gajendra Singh and brought him on his tractor why you have come here". and then he ran about 250 steps towards the east and stood there but the version given in the statement before PW 17 was different. This evidence can be relied on only for the purpose of showing that about 15 or 20 people were travelling in the trolley of a tractor driven by the first accursed which was going towards the river. This evidence does not bring home the offence of screening the evidence. Of course PW 10 said that the body was burnt with wooden pieces and grass after it was all burnt Chet Ram, who is now dead, collected the whole residual ashes and threw them in the Sutia rivulet. he mentioned the name of Chet Ram and no other name. Further though he sated to be neighbour of Ram Sewak PW 2 and Ram Sewak and himself used to meet everyday he did not tell PW 2 about the burning of the body of the appellants. This witness also belongs to the Ahir community which is the community of the deceased Gajendra Singh also. It appears that only the bones stated to have been recovered were sent for chemical analysis and the report of the serologist was that it was not possible to 865 give any opinion regarding the origin, sex and age. The report had not even stated that they were human bones. Though PW 10 had stated that there were with him two others at the time and PW 17 had taken PW 10 and the said two others also to the place where the body was stated to have been burnt, they had not been examined. We have read the evidence carefully and the evidence also does not impress us that he is telling the truth. In the result we set aside the conviction of the appellants under section 201, IPC. The conviction of the first appellant is modified into one under section 307, IPC and we sentence him to 10 years rigorous imprisonment. The bail bonds of appellants 2,3 and 4 are cancelled. The first appellant is directed to surrender. R.N.J. Appeal partly allowed.

Nineteen persons were tried by the Additional District and Session Judge, Khetri in S.T. No. 264 of 1973 for offences under section 302/149, 201/149, 379/149, 147 and 148 for the incident that took place on 25.4.1972 in village Padaria Tula (UP) on the day of filing of the nomination papers for election for the post of Pradhan Gaon Sabha, Tikhra in which fire arms were used by the party led by Bhupendra Singh accused no.l, who was also a candidate for the office of Pradhan of Gaon Sabha resulting in the death on the spot of Gajendra Singh, one of the supporters of the rival candidate Ram Sewak, P.W. 2. The prosecution case is that both the rival candidates with their supporters had come to village Padaria Tula on the morning of 25.4.1972 where nomination papers had to be filed. On seeing the party of the deceased arriving, Bhupendra Singh enquired from Ram Sewak (P.W.2) if he had come to file his nomination papers against him. Gajendra Singh (deceased) intervened and challengingly told the accused No. 1 that he should ask him. Following the altercation that ensued, it is alleged that Bhupendra Singh fired the first shot on the deceased followed by shooting by his other associates and the deceased fell dead. The party of Ram Sewak fled from the scene to escape the 857 attack. It is further alleged that the body of the deceased was dragged by Gajendra Singh and his companions and carried by them on a tractor trolly belonging to A1 on which they had come, burnt it and ashes thrown in the river causing disappearance of the entire evidence. The first Additional Judge acquitted all the charges on the ground that there are many infirmities in the prosecution case rendering its evidence unworthy of belief. The state of Uttar Pradesh preferred appeal before the Lucknow Bench of the Allahabad High Court. The High Court set aside the acquittal of Bhupendra Singh (A1) and convicted him for offence under section 302 I.P.C and awarded sentence of Rigorous Imprisonment for life , set aside the acquittal of A 4, 7, 8 in part, convicted them under section 201 of I.P.C. and sentenced each of them to seven years Rigorous Imprisonment thereunder. Their acquittal under other charges was confirmed. Appeal as against rest of the accused was dismissed altogether. A1, 4, 7 and 8 have thus come in appeal against the judgement of the High Court. In party allowing the appeal setting aside the conviction of appellants 2 to 4 (A1, 7, 8) under section 201 I.P. C. , and altering the conviction of appellant No. 1 (A1) from one under section 302 I.P. C. to one under section 307 I.P.C. and sentencing him to a term of 10 years rigorous imprisonment thereunder, this Court. HELD: The evidence only established that the first appellant shot at the deceased but it is not known where the bullet hit and whether that injury caused by the said bullet shot caused the death. Even in the case of shooting by a rifle unless the evidence shows the particular injury caused by the same and that injury is sufficient to cause death, the offence under section 302 I.P.C. could not be said to have been made out. In the circumstances, therefore, we are unable to agree with the High Court that the first appellant is guilty of offence under section 302 IPC of causing the death of Gajendra Singh. However we are of the view that while the first appellant shot at the deceased there could be no doubt that either he had the intention to kill him or at least he had the knowledge that the act could cause the death. [863D E] We consider that the offence would come under the second limb or second part of section 307, IPC. Though imprisonment for life also could be awarded as sentence for such an offence, on the facts and circumstances we impose a sentence of 10 years rigorous imprisonment. We alter the conviction under section 302, IPC to one under section 307 IPC and sentence him to a term of 10 years rigorous imprisonment. [863G]. 858 So far as the offence under section 201 IPC is concerned we have read the entire evidence carefully and the same does not impress as to bring home the offence of screening the evidence. [863H,865H]

Criminal Appeal No. 191 of 1962. Appeal by special leave from the judgment and order dated April 9, 10 and 12 of 1962 of the Gujarat High Court in Criminal Appeal No. 426 of 1961. A. section R. Chari, and R. A. Gagrat, for the appellants. H. R. Khanna, R. H. Dhebar and B. R. G. K. Achar, for the respondent. The Judgment of the Court was delivered by Subba Rao J. This appeal by special leave raises an interesting question involving the construction of section 34, read with section 301 of the Indian Penal Code. The appellants who are 11 in number were accused Nos. 1 to 10 and 12 in the Sessions Court, Mehsana. The case of the prosecution may be stated thus : In the village of Aithor there are about 300 houses of Kadva Patidars and about 15 to 20 houses of Leva Patidars. On January 16, 1961, at about 8 P.m. seven persons, who are Leva Patidars, came to the chowk where there is a pan shop cabin of Girdhar Shanker. These seven persons were, Rama Bhupta, Lakha Madha, Hira Punja, Jetha Nagar, Parshottam Prabhuva, Manor Madha and Gova Shiva. At the same time the 12 accused also came to that place. Accused 1 to 6 were each armed with a muzzle loading gun; accused 7, 288 8, 11 and 12 were armed with sticks; accused 9 and 10 were armed with dharias. Accused I to 4 fired their guns and Rama Bhupta fell down and died near the door of the cabin of Girdhar. Accused 5 and 6 fired their guns and Lakha Madha was injured. Accused I fired his gun again and Jetha Nagar received injuries. Accused 5 and 6 fired again and Hira Punja was injured. Accused 7 to 12 were inciting accused 1 to 6 to kill all these persons. Other specific acts were attributed to some of the accused. The learned Sessions Judge held that Rama Bhupta was killed as a result of the firing by accused 1 to 4, that Lakha Madha was injured by the firing by accused 5 and 6, that Jetha Nagar was injured by the firing by accused 1, that Hira Punja was injured by the firing by accused 5 and 6, that accused 12 caused stick injuries to Lakha and that accused 8 caused injury on the tongue of Parshottam Prabhuva. The Sessions Judge also held that the 12 accused constituted an unlawful assembly, but their common intention was not to kill Rama Bhupta but only Madha who was not present in the chowk. He acquitted all the accused under section 302, read with section 149, of the Indian Penal Code, but convicted accused I to 4 under section 302, read with section 34, of the Indian Penal Code and sentenced them to imprisonment for life and to a fine of Rs. 2,000 each; lie convicted all the accused under section 324, read with section 149, of the Indian Penal Code for causing injuries to Hira Punja and others. Accused 5 to 12 were also convicted under section 326, read with section 34, and section 324, read with section 149 and section 148, of the Indian Penal Code and they were sentenced to various periods of imprisonment and fine. The accused preferred different appeals against their convictions and sentences and the State of Gujarat filed appeals against the acquittal of accused 5 to 12 under section 302, read with section 149, of the Indian Penal Code. The State of Gujarat also filed a criminal revision for enhancing sentences passed against all the accused, but it did not file any appeal against the acquittal of accused I to 4 on the charge under section 302, read with section 149, of the Indian Penal Code. The High Court convicted accused I to 4 under section 302, read with sections 301 and 34, of the Indian Penal Code and confirmed the sentence of life imprisonment passed on them, but set aside the fine imposed on them. So far as the other accused i.e., accused 5 to 12, are concerned, they were convicted under section 302, read with sections 301 and 34, of the Indian Penal Code and also under section 302, read with section 149, of the said Code. In the result, the High Court sentenced all the accused to imprisonment for life for the said offences. 289 It is common case that if the conviction of accused 1 to 4 tinder section 302, read with section 34 and section 301, of the Indian Penal Code, was set aside, all the accused would have to be acquitted in regard to the major offences. It is also not disputed that if the conviction of accused I to 4 under the said sections was confirmed, the appeal filed by the other accused would fail. The only question, therefore, is whether the conviction of accused I to 4 under section 302, read with sections 34 and 301, of the Indian Penal Code, was correct. In the appeal Mr. Chari, learned counsel for the appellants, contends that accused I to 4 could not be convicted under section 302, read with section 34, of the Indian Penal Code, as there was no common intention to kill Rama, but Rama was killed under the mistake that he was Madba. l A mistake by one or other of the accused, the argument proceeds, cannot possibly be "in furtherance of the common intention" of the accused. He further argues that the provisions of section 301 of the Indian Penal Code cannot be invoked in the circumstances of the case. To appreciate the argument of the learned counsel it would be convenient at this stage to note exactly the finding given by the High Court. The High Court found that the common intention of the accused was to kill Madha, that accused 1 to 4 shot at Rama mistaking him for Madha, as Rama had dressed himself in the habiliments similar to those in which Madha used to dress himself and, therefore, the accused shot at Rama under the mistaken belief that be was Madha. Section 34 of the Indian Penal Code reads "When a criminal act is done by several persons, in furtherance of the common intention of all, each of such persons is liable for that act in the same manner as if it were done by him alone." Section 34 was subject of judicial scrutiny in innumerable cases. The expression "in furtherance of the common intention of all" was not in the original section, but was inserted in the section by section 1 of Act XXVII of 1870. The Judicial Committee in Barendra Kumar Ghosh vs Emperor(1) defined the expression "criminal act" in the said section thus: "A criminal act means that united criminal behaviour which results in something for which an individual (1) Cal. 197 (P.C.) : L.R. 52 I.A. 40 290 would be punishable if it were all done by himself alone,that is, in a criminal offence. " The Judicial Committee in Mahbub Shah vs King Emperor(1) laid down the following 'conditions for its application: "To invoke the aid of section 34 successfully, it must be shown that the criminal act complained against was done by one of the accused persons in the furtherance of the common intention of all; if this is shown, then liability for the crime may be imposed on any one of the persons in the same manner as if the act were done by him alone. This being the principle, it is clear to their Lordships that common intention within the meaning of the section implies a pre arranged plan, and to convict the accused of an offence applying the section it should be proved that the criminal act was done in concert pursuant to the pre arranged plan. As has been often observed, it is difficult, if not impossible, to procure direct evidence to prove the intention of an individual; in most cases it has to be inferred from his act or conduct or other relevant circumstances of the case. " It is, therefore, clear that the criminal act mentioned in section 34 of the Indian Penal Code is the result of the concerted action of more than one person; if the said result was reached in furtherance of the common intention, each person is liable for the result as if he had done it himself. The question is what is the meaning of the expression "in furtherance, of the common intention". The dictionary meaning of the word "furtherance" is "advancement or promotion". If four persons have a common intention to kill A, they will have to do many acts in promotion or prosecution of that design in order to fulfill it. Some illustrations will clarify the point. Four persons intend to kill A, who is expected to be found in a house. All of them participate in different ways. One of them attempts to enter the house, but is stopped by the sentry and he shoots the sentry. Though the common intention was to kill A, the shooting of the sentry is in furtherance of the said common intention. So section 34 applies. Take another illustration. If one of the said accused enters the room where the intended victim usually sleeps, but somebody other than the intended victim is sleeping in the room, and on a mistaken impression he shoots him. The shooting of the wrong man is in furtherance of the common intention and so section 34 applies. Take (1) L.R. 72 I.A. 148, 153. 291 a third variation of the illustration. The intended victim has a twin brother who exactly resembles him and the accused who is entrusted with the part of shooting the intended victim, on a mistaken impression, shoots the twin brother. The shooting of the twin brother is also in furtherance of the common intention. Here also section 34 applies. If that much is conceded we do not see any justification why the killing of another under a mistaken impression of identity is not in furtherance of the common intention to kill the intended victim. When the accused were shooting at Rama believing him to be Madha, they were certainly doing a criminal act in furtherance of the common intention which was to kill Madha. They killed Rama because they believed that they were shooting at Madha. Mr. Chari argues, how can a mistake committed by one of the accused be in furtherance of a common intention ? For it is said that to commit a mistake was not a part of the common intention of the accused. But the question is not, as we have pointed out, whether the committing of a mistake was a part of the common intention, but whether it was done in furtherance of the common intention. If the common intention was to kill A and if one of the accused kills B to wreak out his private vengeance, it cannot possibly be in furtherance of the common intention for which others can be constructively made liable. But, on the other hand if he kills B bona fide believing that he is A, we do not see any incongruity in holding that the killing of B is in furtherance of the common intention. We, therefore, hold that without the aid of section 301 of the Indian Penal Code it can be held that when accused I to 4 shot at Rama they shot at him in furtherance of their common intention to kill Madha. Now let us see the impact of section 301 of the Indian Penal Code on section 34 thereof. Section 301 reads: "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. " This section deals with a different situation. It embodies what the English authors describe as the doctrine of transfer of malice or the transmigration of motive. Under the section if A intends to kill B, but kills C whose death he neither intends nor knows himself to be likely to cause, the intention to kill C is by law 292 attributed to him. If A aims his shot at B, but it misses B either because B moves out of the range of the shot or because the shot misses the mark and hits some other person C, whether within sight or out of sight, under section 301, A is deemed to have hit C with the intention to kill him. What is to be noticed is that to invoke section 301 of the Indian Penal Code A shall not have any intention to cause the death or the knowledge that he is likely to cause the death of C. In the instant case this condition is not complied with. The accused shot at a particular person with the intention of killing him though under a misapprehension of his identity. In that case, all the ingredients of sections 299 and 300 of the Indian Penal Code are complied with. The aid of section 301 of the Indian Penal Code is not called for. We are, therefore, of the opinion that section 301 of the Indian Penal Code has no application to the present case. For the foregoing reasons we hold that all the accused are liable under section 302, read with section 34, of the Indian Penal Code. If we reach this conclusion, it is conceded that no other point arises in this appeal. The appeal fails and is dismissed. Appeal dismissed.

Where four persons shot at the deceased with the intention of killing him but under a misapprehension that he was some one else they could be found guilty of an offence under section 302 of the Indian Penal Code, read with section 34 of the Code. It would be a case of killing the deceased in furtherance of their common intention to kill the other, and there would not be any necessity to invoke section 301 of the Code to find them guilty. In fact that section would apply only to cases where there was, no intention to cause the death, or knowledge that death was likely to be caused, of the deceased. [291D E, H; 292A B]. Barendra Kumar Ghosh vs Emperor, L.R. 52 I.A. 40 and Mahbub Shah vs King Emperor, L.R. 72 I.A. 148 referred to.

iminal Appeal No. 25 of 1968. Appeal by special leave from the judgment and order, dated July 20, 1967 of the Allahabad High Court in Cr. A. No. 469 of 1967 and Ref. No. 21 of 1967. K. K. Luthra, for the appellant. O. P. Rana, for the respondent. The Judgment of the Court was delivered by Bhargava, J. The appellant Bashira was convicted by the Court of Session for having committed the murder of his own wife Saira alias Mahobawali with an axe inside his house at about 11 a.m. on 22nd August, 1966. The First Information Report of this incident was lodged on the same day at 5 15 p.m. by Naziran, the mother of the appellant, who went to the Police Station accompanied by the Chaukidar. The investigation of the case began on 23rd August, 1966. The appellant surrendered himself in Court on 24th August, 1966. On 15th September, 1966, the Challan was presented in the Court of the Magistrate who recorded some evidence, proceeded in accordance with section 207A of the Code of Criminal Procedure, and then, on 28th November, 1966, committed the appellant for trial to the Court of Session for the offence of committing the murder of his wife punishable under section 302 of the Indian Penal Code. The Temporary Civil & Sessions Judge of Hamirpur fixed 28th February, 1967 as the date for starting the actual trial of the case. On that day, before beginning the trial, he appointed one Sri Sirish Chandra, Advocate, as amicus curiae counsel to represent the appellant. He amended the charge which was read out to the appellant who pleaded not guilty. Thereafter, on that very day, evidence of two principal prosecution witnesses was recorded. The first witness was Smt. Naziran, the mother of the appellant, who had lodged the F.I.R., and the second witness was Khan Bahadur, son of the appellant, who was the sole eye witness of the incident of murder. The remaining evidence was recorded on 1st March, 1967, on which date the appellant was also examined under section 342, Cr. The appellant stated that be would not produce any defence. A joint application of coun sel for parties was presented on that day requesting the court to make a local inspection and 12th March, 1967 was fixed for local inspection. The Temporary Sessions Judge in that order 34 directed that a suitable conveyance should be arranged for him as he had no conveyance of his own. On 8th March, 1967, the Public Prosecutor gave it in writing that no conveyance could be arranged and, therefore, prayed that the local inspection may be cancelled. The Judge cancelled the direction for local inspection and then fixed 10th March, 1967 for arguments. On that day, Sri Shukla, counsel representing the appellant presented an application praying for the recall of P. W. 2 Khan Bahadur for further cross examination on the ground that there had been an omission in drawing his attention to a contradiction with his statement recorded in the Court of the Committing Magistrate. He added that there were many other things to be seen and made this request in the interest of justice. The Judge held that the ground for recall that the witness could not be cross examined effectively would hardly justify the recall of the witness for further crossexamination. He further expressed his opinion that, even if the statement attributed to the witness as having been made by him in the Court of the Committing Magistrate is brought on the record, it would not help the appellant to any appreciable degree in his defence. On these grounds, the application was rejected. Arguments were then heard on the same day and judgment was delivered on 13th March, 1967, convicting the appellant for the offence of murder under section 302, I.P.c and sentencing him to death. The appellant appealed in the High Court of Allahabad and the Tempy. Sessions Judge also made a reference for confirmation of the sentence of death. The High Court dismissed the appeal, accepted the reference and confirmed the sentence of death. The appellant has now come up to this Court against that judgment of the High Court in appeal by special leave. In this case, the principal ground urged on behalf of the appellant raises an important question of law. Learned counsel appearing for the appellant emphasised the circumstance that the amicus curiae counsel to represent the appellant was appointed by the Sessions Judge on the 28th February, 1967, just when the trial was about to begin nd this belated appointment of the counsel deprived the appellant of adequate legal aid, so that he was unable to defend himself properly. It was urged that the procedure adopted by the Court was not in accordance with law, so that, if the sentence of death is carried out, the appellant will be deprived of his life in breach of his fundamental right under Article 21 of the Constitution which lays down that no person shall be deprived of his life or personal liberty, except according to procedure established by law. The main procedure for trial of a criminal case is laid down in the Code of Criminal Procedure and, in this case, there is no grievance that the procedure laid down therein was not followed by the Court of Session. The grievance, however, is that there 35 are provisions supplementing the procedure laid down by the Criminal Procedure Code and the course adopted by the Court of Session was in breach of these supplementary rules. Reference was made to Rule 37 in Chapter V of the General Rules (Criminals), 1957 (hereinafter referred to as "the Rules") promulgated by the High Court of Allahabad in exercise of its powers under Article 227 of the Constitution and section 554 of the Code of Criminal Procedure. These Rules were published under Notification No. 241/A/Vlll a 1, dated September 4, 1956 in the Supplement to the Government Gazette of Uttar Pradesh, dated 3rd November, 1956. The notification clearly mentions the powers under which the High Court promulgated the Rules and also contains a clear recitation that the Rules were being published with the previous approval of the Government of Uttar Pradesh. We have mentioned these details, because at one stage it was urged by learned counsel appearing for the respondent State Government that R. 37 of the Rules had no statutory force at all. The notification in the Gazette makes it perfectly clear that these Rules were all framed by the High Court in exercise of the powers conferred on it by the Constitution or by the Code of Criminal Procedure. The Rules are, therefore, clearly statutory Rules and,as such,they form a part of the procedure for trial of criminate cases by courts subordinate to the High Court of Allahabad, in addition to the procedure laid down by the Code of Criminal Procedure. Rule 37 of the Rules is as follows "In any. case which comes before a Court of Session, the court may engage counsel to defend the ac cused person if (a) the charge against him is such that a capital sentence is possible, and (b) it appears that he has not engaged counsel and is not possessed of sufficient means to do so. To enable the Sessions Court to arrive at a decision as regards the second condition in the preceding paragraph, the committing Magistrate shall in such cases make enquiries from the accused at the time of commitment and after making such other enquiries as may be necessary, report within a month of the commitment order to the, court to which the commitment is made whether the accused is possessed of sufficient means to engage counsel. Each case must be decided on its merits and no hard and fast rule as to sufficiency of means should be applied. The Sessions Court in making its decision shall not be bound by the report of the committing magistrate. 36 .lm15 Counsel appointed under this rule shall be furnished with the necessary papers free of cost and allowed sufficient time to prepare for the defence. " On the basis of the language used in this Rule, learned counsel for the State urged that this Rule should not be held to be mandatory, but only a Rule enabling a Court to engage a counsel to defend a person accused of an offence punishable with capital sentence. It is true that the word used is "may" in this Rule, but, in our opinion, the purpose of the Rule will be completely defeated if we were to accept this submission. It appears that the word "may" was used only because there are certain conditions laid down, on the existence of which depends the appointment of the amicus curiae counsel to represent the accused. The principal pre condition is that the accused has himself not engaged a counsel and is not possessed of sufficient means to do so. The Rule adds that no hard and fast rule as to the sufficiency of means should be applied when the court has to decide whether an amicus curiae counsel should be provided at the cost of the Government, and each case must be decided on its merits. It was because of these conditions that the word "may" was used in the Rule; but the intention of the Rule is perfectly clear that no accused person should remain totally unrepresented by a lawyer, if he is being tried on a charge for which a capital sentence can be awarded. Considering the purpose of this Rule, we hold that the word "may" in this Rule must be interpreted as laying down a mandatory direction to the Court to engage a counsel, if the conditions laid down in the Rule are otherwise satisfied. In this connection, learned counsel for the State drew our attention to two decisions of this Court reported in Janardan Reddy and Others vs The State of Hyderabad and Others and connected Appeals(1), and Tara Singh vs The State(2). In the first of these two cases, this Court was considering the effect of section 271 of the Hyderabad Criminal Procedure Code read along with the Rules and Circular Orders issued by the Hyderabad High Court and, in that connection, held that, though section 271 of the Hyderabad Criminal Procedure Code corresponds to section 340 of the Indian Criminal Procedure Code, these provisions did not Jay down as a rule of law that in every capital sentence case, where the accused is unrepresented, the trial should be held to be vitiated. In the second case, this Court examined the scope of the right conferred on an accused by section 340(1) of the Code of Criminal Procedure and held that it does not extend to a right in an accused person to be provided with a lawyer by the State or by the Police or by the Magistrate. The Privilege conferred by this provision only gave a right to an accused to be represented by a counsel if he wanted to engage one himself or to (1) ; (2) ; 37 get his relations to engage one for him. The only duty cast on the Magistrate is to afford him the necessary opportunity for this purpose. It appears to us that neither of these two cases is applicable to the case before us, because, in those cases, no question arose of taking into account a provision laying down procedure for trial of cases such as is contained in r. 37 of the Rules. These cases, no doubt, show that section 340, Cr. P.C. by itself, does not cast any duty on a court to provide a counsel at State expense even when the offence triable is punishable with death; but that is imaterial, because the right, on which the appellant is basing his claim, is sought to be justified under r. 37 of the Rules. Learned counsel for the State, in view of these two decisions, urged before us that we should hold that r. 37 of the Rules was void as contravening the principle laid down by section 340, Cr. P.C., explained in the two cases referred to above. We are unable to appreciate this argument. Section 340, Cr. P.C., does not prohibit the appointment of a counsel by the Court at State expense, though it does not prescribe such an appointment as a mandatory direction to be carried out by the Court. Rule 37 of the Rules only supplements the provision contained in section 340, Cr. P.C., and is, therefore, in no way in conflict with section 340, Cr. P.C., and it cannot be held that it is void on any such ground. We have already quoted above r. 37 of the Rules in full. The grievance on behalf of the appellant is not that no counsel at all was engaged to represent him in the Court of Session; but non compliance with the Rule is urged on the ground than there was breach of the last clause of that Rule, That clause requires that the counsel appointed under the Rules shall be furnished with necessary papers free of cost and allowed sufficient time to prepare for the defence. In this case, the facts mentioned by us earlier clearly show that Sri Shukla was appointed counsel for the appellant on 28th February, 1967, which was the date fixed for starting the trial, and the trial was, in fact, started after his appointment on that very day. Thus, sufficient time was not allowed to him to prepare for the defence of the appellant. At one stage, information was attempted to be given to this Court on behalf of the State Government on the basis of entries in the register maintained for appointment of amicus curiae counsel that, in fact, Sri Shukla had been appointed to represent the appellant on 18th February 1967. That register was sent for by us and it appears that this position was taken on behalf of the State Government, because, at one place in that register, the date showing appointment of Sri Shukla as counsel for the appellant was so entered that it could be read as 18th February 1967 as well as 28th February 1967. There were, however, other entries in the register which clarified the position and indicated that even that date must be read as 28th February 1967 and learned coun 38 sel for the State conceded that the appointment of the amicus curiae counsel was, in fact, made on 28th February, 1967. There is nothing on the record to show that, after his appointment as counsel for the appellant, Sri Shukla was given sufficient time to prepare the defence. The order sheet maintained by the .,Judge seems to indicate that, as soon as the counsel was appointed, the charge was read out to the accused and, after his plea had been recorded, examination of witnesses began. The counsel, of course, did his best to cross examine the witnesses to the extent it was possible for him to do in the very short time available to him. It is true that the record, also does not contain any note that the counsel asked for more time to prepare the defence, but that, in ;our opinion, is immaterial. The Rule casts a duty on the court itself to grant sufficient time to the counsel for this purpose and the record should show that the Rule was complied with by granting him time which the court considered sufficient in the particular circumstances of the case. In this case, the record seems to show that the trial was proceeded with immediately after appointing the amicus curiae counsel and that, in fact, if any time at all was granted, it was nominal. In these circumstances, it must be held that there was no compliance with the ,requirements of this Rule. In this connection, we may refer to the decisions of two of ,the High Courts where a similar situation arose. In Re: Alla Nageswara Rao, Petitioner(1) reference was made to Rule 228 of the Madras Criminal Rules of Practice which. provided for engaging a pleader at the cost of the State to defend an accused person in a case where a sentence of death could be passed. It was held by Subba Rao, Chief Justice as he then was, speaking for the Bench, that : " a mere formal compliance with this Rule will not carry out the object underlying the rule. A sufficient time should be given to the advocate engaged on behalf of the accused to prepare his case and conduct it on behalf of his client. We are satisfied that the time given was insufficient and, in the circumstances, no real opportunity was given to the accused to defend himself. " This view was expressed on the basis of the fact found that the advocate had been engaged for the accused two hours prior to the trial. In Mathai Thommen vs State(2), the Kerala High Court was dealing with a Sessions trial in which the counsel was engaged to defend the accused on 2nd August, 1958, when the trig was posted to begin on 4th August, 1958, showing that (1) A.I.R. 1957 A.P. 505. (2) A.I.R. 1959 Kerala 241. 39 barely more than a day was allowed to the counsel to get prepared and obtain instructions from the accused. Commenting on the procedure adopted by the Sessions Court, the High Court finally expressed its opinion by saying : "Practices like this would reduce to a farce the engagement of counsel under rule 21 of the, Criminal Rules of Practice which has been made fOr the purpose of effectively carrying out the duty cast on courts of law to see that no one is deprived of life and liberty without a fair and reasonable opportunity being afforded to hm to prove his innocence. We consider that in cases like this counsel should be engaged at least some 10 to 15 days before the trial and should also be furnished with copies of the records. " In our opinion, no hard and fast rule can be laid down as to the time which must elapse between the appointment of the counsel and the beginning of the trial; but, on tile circumstances of each case, the Court of Session must ensure that the time granted to the counsel is sufficient to prepare for the defence. In the present case, when the counsel was appointed just before the trial started, it is clear that there was failure to comply with the requirements of the rule of procedure in this behalf. Learned counsel for the State urged before us that we should not hold that the award of, the sentence of death to the appellant in this case is in breach of the fundamental right conferred by article 21 of the Constitution, because, he submitted, r. 37 of the Rules was not enacted by any legislature and, consequently, it should not be held to be a part of the procedure established by law. In this connection, he relied on the view expressed by Kania, C.J., in A. K. Gopalan vs The State of Madras(1), where lie held "No extrinsic aid is needed to interpret the words of article 21, which in my opinion, are not ambiguous. Normally read, and without thinking of other Constitutions,the expression 'procedure prescribed by law 'must mean procedure prescribed by the law of the State. " This Interpretation was given in order to exclude from the scope of article 21 rules of natural justice which are not incorporated in any law. Proceeding further, he dealt with the language of Art.31 where the expression used is "by authority of law" and held "It is obvious that in that clause 'law ' must mean enacted law". (1) ; ,111 12. 40 We do not think that, in expressing these views, the learned Chief Justice intended to explain the full scope of the word "law" as used in article 21. What he was concerned with was to examine whether rules of natural justice could also be covered by that word in this article and he held that this will not be justified. In later cases, the Court has clarified the position and has held that the word "law" in article 21 includes subordinate legislation not enacted by the legislature, but promulgated by the delegated authority in exercise of its statutory powers. Thus, in Maqbool Hussain vs The State of Bombay & Connected Cases(1), the Punjab Communist Detenus Rules, 1950 framed by the Government of Punjab under section 4(a) of the were held to be covered by the word "law". In Pandit M. section M. Sharma vs Shri Sri Krishna Sinha and Others,(2) Rules made by the Legislature under articles 118(1) and 208(1) and the privileges of each House under articles 105(3) and 194(3) were held to be law justifying deprivation of personal liberty guaranteed by article 21. In the case of Makhan Singh vs State of Punjab & Connected Appeals(3), the Defence of India Rules made by the Central Government under section 3 of the Defence of India Ordinance, 1962 were held to be "law" for purposes of Article 21. Thus, this Court has clearly laid it down that Rules made by a subordinate legislative authority in exercise of its delegated power of legislation granted by the Constitution or a Statute enacted by the legislature are "law" for purposes of article 21, though, of course, it is always open to the person affected to challenge the validity of those Rules. In the present case. we have already held that r. 37 of the Rules has been framed in exercise of the powers of the High Court under article 227 of the Constitution and section 554 of the Code of Criminal Procedure, and is a valid Rule. In these circumstances, the conviction of the appellant in a trial held in violation of that Rule and the award of sentence of death will result in the deprivation of his life in breach of the procedure established by law. Learned counsel also urged that we should not hold the con viction and sentence to be void when it is not shown that there was any prejudice to the appellant by the failure of the court to observe the procedure laid down by the Rule. In our opinion, in such a case, the question of prejudice does not arise when a citizen is deprived of his life without complying with the procedure prescribed by law. We may, however, add that, in this case, the facts indicate that there was, in fact, prejudice to the accused caused by the non compliance with the requirement of r. 37 of the Rules. The two principal witnesses, Naziran and Khan Bahadur, were examined immediately after the appointment of (1) ; (2) [1959] Supp. 1 S.C.R. 806. (3) [1964] 4 S.C.R. 797. 41 amicus curiae counsel and the application presented on behalf of the accused on 10th March, 1967, to which we have referred above clearly shows that the counsel felt that he had not been able to cross examine at least the sole eye witness Khan Bahadur properly. That is why he presented an application for recall of that witness. It is obvious that, in rejecting that application, the Sessions Judge failed to notice that the counsel had been appointed on the very day when that witness was examined and sufficient time had not been granted to him to prepare the defence. In fact, we feel that, in such cases, if sufficient time is not granted to the counsel to prepare defence, prejudice must necessarily be inferred and the trial will be vitiated. As a consequence, we set aside the conviction and sentence of the appellant. Since we are holding that the conviction is void because of an error in the. procedure adopted at the trial, we direct that the appellant shall be tried afresh for this charge after complying with the requirements of law, so that the case is remanded to the Court of Session for this purpose. V.P.S. Appeal allowed and retrial order.

The appellant was charged with the offence of murder under section 302 IPC. Just before the beginning of the trial, the Sessions Court appointed, an advocate as amicus curiae to represent the appellant. After the examination of witnesses, on the day on which the case was posted for argument, appellant 's counsel prayed for the recall of the sole eyewitness for further cross examination as the witness could not be cross examined effectively. The application was rejected, and after hearing arguments, the court con victed the appellant and sentenced him to death. The conviction and sentence were confirmed by the High Court. in appeal to this Court, it was contended that the belated appointment of counsel deprived the appellant of adequate legal aid and that be would be deprived of his life in breach of his fundamental right under article 21. HELD:The right on which the accused based his claim is based on r.37 of the General Rules (Criminal) 1957, promulgated by the High Court in exercise of its powers under article 227 of the Constitution and section 554 of the Criminal Procedure Code. Therefore, the rule is a statutory rule and forms part of the procedure for trial of criminal cases. Its intention is that no accused person should remain unrepresented by a lawyer if he is being tried on a charge for which a capital sentence can be awarded. Notwithstanding the use of the word 'may '. considering the purpose of the rule, it must be interpreted as laying down a mandatory direction to the Court to engage a counsel if the conditions laid down therein are satisfied. As the rule supplements the provision contained in section 304 Cr. P.C. under which such appointment of counsel is not mandatory, it is not in conflict with the section. The last clause of the rule requires that the counsel appointed under the Rules shall be furnished with necessary papers free of cost and allowed sufficient time to prepare for the defence. [35D E; 36 E; 3B, D, E F] In the present case, when the counsel was appointed just before the trial started, there was a failure to comply with the requirements of the rule. Even though counsel did not ask for time it was the duty of the court, under the rule, to grant sufficient time to counsel, and, when sufficient time was not granted to counsel to prepare the defence, prejudice must necessarily be inferred and the trial held vitiated. Further, as the word 'law ' in article 21 includes subordinate legislation promulgated by delegated authority there is a breach of article 21, and therefore the question of prejudice does not arise. [38C; 40B, G H; 41B] Maqbool Hussain vs State of Bombay, ; , Pandir M. section M. Sharma vs Shri Sri Krishna Sinha, [1950] Supp. 1 S.C.R. 806 and Makhan Singh vs State of Punjab, [1964] 4 S.C.R. 797, followed. 33 A. K. Gopalan vs State of Madras, ; , 111 112; Janardan Reddy vs State of Hyderabad, ; and Tara Singh vs The State, ; , explained. Re:Alla Nageswara Rao, A.I.R. 1957 A.P. 505 and Mathai Thommen vs State A.I.R. 1959 Kerala 241, referred to.

il Appeal No. 1102 of 1966. Appeal from the judgment and order dated December 27, 1965 of the Jammu and Kashmir High Court in W. P. No. 67 of 1965. C.K. Daphtary, Attorney General, section V. Gupte, Solicitor General, Jaswant Singh, Advocate General for the State of J. & K. H. R. Khanna; section Javali, Ravinder Narain, for the appellants. B. Sen, I. N. Shroff, M. K. Banerjee, B. N. Kirpal, R. K. Kaul, R. N. Kaul, P. L. Handu, Lalit Bhasin and T. R. Bhasin, for respondent No. 1. The Judgment of the Court was delivered by Sarkar C.J. This is an appeal by the State of Jammu and Kashmir, G. M. Sadiq, Chief Minister of that State and D. P.Dhar its Home Minister. The appeal is contested by respondent 403 No. 1, Bakshi Ghulam Mohammad. The other respondent, N., Rajagopala Ayyangar, a retired Judge of this Court, has not appeared in this Court or in the court below. These are the parties to the proceedings before us. After the accession of the State of Jammu and Kashmir to India in 1947, a responsible Government was set up there under the Prime Ministership of Shiekh Mohammad Abdulla. Bakshi Ghulam Muhammad was the Deputy Prime Minister in that Government and G. M. Sadiq was also in the Cabinet. In 1953 Sheikh Mohammad Abdulla was dismissed from office and a new Government was formed with Bakshi Ghulam Mohammad as the Prime Minister and G. M. Sadiq and D. P. Dhar were included in the Cabinet. On January 26, 1957, a new Constitution was framed for Jammu & Kashmir. In the first elections held under the Constitution, a party called the National Conference got the majority of votes. Bakshi Ghulam Mohammad and Sadiq were members of this party. A Ministry was then formed with Bakshi Ghulam Mohammad as the Prime Minister. It appears that G. M. Sadiq left the party sometime after 1957 and rejoined it along with D. P. Dhar in December 1960 and they were taken into the Cabinet. The next General Elections were held in 1962. Again, the National Conference Party came into power. In the Government that was formed, Bakshi Ghulam Mohammad became the Prime Minister and G. M. Sadiq and D. P. Dhar were taken in the Ministry. In September 1963, Bakshi Ghulam Mohammad resigned from the Ministry under what is called the Kamraj Plan and Shamsudd in became the Prime Minister in his place. It will be noticed that Bakshi Ghulam Mohammad was the Deputy Prime Minister of the State from 1947 to 1953 and its Prime Minister from 1953 to 1963. So he held these offices, one after the other, for a total period of about sixteen years. In February 1964, Shamsuddin left office and a new Govern ment was formed with G. M. Sadiq as the Prime Minister. It is said that shortly thereafter, political rivalry between him and Bakshi Ghulam Mohammad started. In August 1964, a notice was issued fixing a session of the Legislature of the State in the following September. According to Bakshi Ghulam Mohammad, thereafter, some of the legislators wanted to bring in vote of no confidence against G. M.Sadiqs Ministry and by September 21, 1964 the no confidence motion had obtained the support of the majority of. members of the Assembly. On September 22, 1964, at 5 o 'clock in the morning, Bakshi Ghulam Mohammad and some of his supporters were arrested under the Defence of India Rules. At 8.30 a.m. on the same day the notice of the motion of no confi dence with the signatures of some members was handed over to the Secretary of the Legislative Assembly. G. M. Sadiq challenges the genuineness of the, signatures on the notice of the motion and also denies that it had the support of, a majority: of the Assembly , At 9 a.m. the Legislative Assembly which was to meet on that day,. 404 was prorogued by the Speaker under the directions of the Sadar i Riyasat, the constitutional head of the State. Sometime in November 1964, a petition for a writ of habeas corpus for the release of Bakshi Ghulam Mohammad was presented to the High Court of Jammu and Kashmir. On December 15, 1964, before the petition could be heard and decided, Bakshi Ghulam Mohammad was released from arrest by the State Government. On January 30, 1965, a Notification was issued by the State Government appointing a Commission of Inquiry constituted by N. Rajagopala Ayyangar to enquire into (1) the nature and extent of the assets and pecuniary resources of Bakshi Ghulam Mohammad and the members of his family and other relatives mentioned in the first Schedule to the Order, in October 1947 and in October 1963; and (ii) whether during this period, Bakshi Ghulam Mohammad and the others mentioned in the Schedule had obtained any assets and pecuniary resources or advantages by Bakshi Ghulam Mohammad abusing the official positions held by him or by the aforesaid people set out in the first Schedule by exploiting that position with his knowledge, consent and connivance. The Notification provided that in making the inquiry under head (ii) the Commission would examine only the allegations set out in the second Schedule to it. It is this Noti fication that has given rise to the present proceedings. The Commission held certain sittings between February 1965 and August 1965 in which Bakshi Ghulam Mohammad took part. On September 1, 1965, Bakshi Ghulam Mohammad moved the High Court of Jammu and Kashmir under sections 103 and 104 of the Constitution of Jammu and Kashmir, which correspond to articles 226 and 227 of the Indian Constitution, for a writ striking down the Notification and quashing the proceedings of the Commission taken till then and for certain other reliefs to which it is not necessary to refer. The petition was heard by a Bench of three learned Judges of the High Court. The High Court allowed the petition, set aside the Notification and quashed the proceedings of the Commission. This appeal is against the judgment of the High Court. In the High Court, eight grounds had been advanced in support of the petition, three of which were rejected but the rest were accepted, some unanimously and some by the majority of the learned Judges. They have however not all been pressed in this Court. The Notification had been issued under the Jammu & Kashmir Commission of Inquiry Act, 1962. The first point taken was that the Notification was not justified by the Act because under the Jammu & Kashmir Constitution, a Minister was responsible for his acts only to the Legislature and no action could be taken against him except for criminal and tortuous acts in the ordinary courts of law, unless the Legislature by a resolution demanded it. The substance of this contention is that an inquiry cannot be directed under the Act into the actions of a Minister except at the instance of the Legislature, it cannot be directed by an order of the Government. This contention is based on section 37 of the Jammu 405 & Kashmir Constitution. That section states that the Council of Ministers shall be collectively responsible to the Legislative Assembly. It is contended that this implies that in no other way is a Minister responsible for anything that he does when in office. It is also said that is the convention in Britain and it has been adopted in the State of Jammu & Kashmir. We confess to a certain amount of difficulty in appreciating this argument. The point about the British convention need not detain us. It has not been shown that any such convention, even if it exists in England, as to which we say nothing, has been adopted in the State of Jammu & Kashmir. The Jammu & Kashmir Constitution is a written document and we can only be guided by its provisions. It is said that section 37 indicates that the British convention was adopted by the State of Jammu & Kashmir. We are unable to agree with this view. Section 37 talks of collective responsibility of Ministers to the Legislative Assembly. That only means that the Council of Ministers will have to stand or fall to other, every member being responsible for the action of any Other. The emphasis is on collective responsibility as distinguished from individual responsibility. The only way that a legislature can effectively enforce this responsibility of the Council of Ministers to it is by voting it out of office. Furthermore, this responsibility is of the Council of Ministers. Bakshi Ghulam Mohammad did not, at the date of the Notification, belong to that Council. He did not on that date owe any responsibility to the Legislature under section 37. That section has no application to this case Again section 3 of the Inquiry Act states, "The Government may and shall if a resolution in this behalf is passed by the Jammu & Kashmir State Legislative Assembly or the Jammu & Kashmir Legislative Council by notification appoint a Commission of Inquiry". It ,would, therefore, appear that the Act gave power to the Government to set up a Commission and also to both the Houses of the Legislature to require a Commission to be set up. It is important to note that even the Legislative Council has a right to get a Com mission appointed though section 37 of the Constitution does not say anything about the responsibility of the Ministers to that Council. The Act was passed by the State Legislature consisting of both the Houses. It would show that the Legislature did not consider that there was any convention or anything in section 37 which prevented a Commission of Inquiry being set up under the Act at the instance of the Government or the Legislative Council. The High Court had rejected this contention and we think that it did so rightly. The next point urged in support of the petition was that the Act permitted a Commission to be set up for making an inquiry into a definite matter of public importance and the matters which the Commission had been set tip to inquire into were not such. This contention found favour with all the learned Judges of the High Court. We are, however, unable to accept it. It is true that 406 a Commission can be set up only to inquire into a definite matter of public importance. But we think that the matters into which the Commission was asked to inquire were such matters. The first inquiry was as to the assets possessed by Bakshi Ghulam Mohammad and the other persons mentioned in the Notification, in October 1947 and in October 1963 and the second was whether during this period being the sixteen years when he held office as Prime Minister and Deputy Prime Minister, he and the other persons named had obtained any assets or pecuniary advantage by abuse of his official position or by that position being exploited by the others with his consent, knowledge or connivance, this inquiry being confined only to the instances set out in the second Schedule to the Notification. That Schedule contains 38 instances, the first of which, in substance, repeats the second head of inquiry earlier mentioned. The other items refer to individual instances of people being made to part with property under pressure brought upon them by abuse of official position and of public money being misappropriated. At the end of this Schedule, there is a note ' stating that the gravamen of the charge was that Bakshi Ghulam Mohammad abused his official position and the other persons named, exploited that position with his consent, knowledge or connivance in committing the acts whereby they acquired vast wealth. The inquiry was, therefore, into the assets possessed by Bakshi Ghulam Mohammad and the persons named, respectively in October 1947 and in October 1963 and to find out whether they had during this period acquired wealth by the several acts mentioned in the second Schedule by abuse or exploitation of Bakshi Ghulam Mohammad 's official position. The first question is, whether these are matters of public importance. Two of the learned Judges held that they were not and the third took the contrary view. This was put on two grounds. First, it was said that these matters were not of public importance because they had to be so at the date of the Notification and they, were not so on that date as Bakshi Ghulam Mohammad did not then hold any office in the Government. It was next said that there was no evidence of public agitation in respect of the conduct complained of and this showed that they were not matters of public importance. We do not think that either of these grounds leads to the view that the matters were not of public importance. As regards the first, it is difficult to imagine how a Commission can be set up by a Council of Ministers to inquire into the acts of its head, the Prime Minister, while he is in office. It certainly would be a most unusual thing to happen. If the rest of the Council of Ministers resolves to have any inquiry, the Prime Minister can be expected to ask for their resignation. In any case, he would himself go out. If he takes the first course, then no Commission would be set up for the Ministers wanting the inquiry Would have gone. If he went out himself, then the Commission would be set up to inquire into the acts of a person who was no longer in office and 407 for that reason, if the learned Judges of the High Court were right, into matters which were not of public importance. The result would be that the acts of a Prime Minister could never be inquired into under the Act. We find it extremely difficult to accept that view. These learned Judges of the High Court expressed the view that the acts of Bakshi Ghulam Mohammad would have been acts of public importance if he was in office but they ceased to be so as he was out of office when the Notification was issued. In taking this view, they appear to have based themselves on the observation made by this Court in Ram Krishan Dalmia vs Shri Justice section R. Tendolkar(1) that "the conduct of an individual may assume such a dangerous proportion and may so prejudicially affect or threaten to affect the public well being as to make such conduct a definite matter of public importance, urgently calling for a full inquiry". The learned Judges felt that since Bakshi Ghulam Mohammad was out of office, he had become innocuous; apparently, it was felt that he could no longer threaten the public wellbeing by his acts and so was outside the observation in Dalmia 's case. We are clear in our mind that this is a misreading of this Court 's observation. This Court, as the learned Judges themselves noticed, was not laying down an exhaustive definition of matters of public importance. What is to be inquired into in any case are necessarily past acts and it is because they have already affected the public well being or their effect might do so, that they became matters of public importance. It is irrelevant whether the person who committed those acts is still in power to be able to repeat them. The inquiry need not necessarily be into his capacity to do again what he has already done and it may well be into what he has done. The fact that Bakshi Ghulam Mohammad is no longer in office does not affect he question whether his acts already done constitute matters of public importance. If once it is admitted, as it was done before us, that if he had been in office his acts would have been matters of public importance, that would be acknowledging that his acts were of this character. His resignation from office cannot change that character. A Minister, of course, holds a public office. His acts are necessarily public acts if they arise out of his office. If they are grave enough, they would be matters of public importance. When it is alleged that a Minister has acquired vast wealth for himself, his relations and friends, as is done here, by abuse of his official position, there can be no question that the matter is of public importance. It was said that the object of inquiry was to collect material for the prosecution of Bakshi Ghulam Mohammad and, therefore, the matters to be required into were not of public importance. This contention is, in our view, fallacious. It is of public importance that public men failing in their duty should be called upon (1) ; 5SCI 28 408 to face the consequences. It is certainly a matter of importance to the public that lapses on the part of the Ministers should be exposed. The cleanliness of public life in which the public should be vitally interested, must be a matter of public importance. The people are entitled to know whether they have entrusted their affairs to an unworthy man. It is said that the Notification did not mention anything about the steps to be taken to prevent recurrence of the lapses in future. But that it could not do. Before the facts were found steps could not be thought of, for the steps had to suit the facts. The inquiry proposed in this case will, in the course of finding out the lapses alleged, find out the process as to how they occurred and it is only after the process is known that steps can be devised to meet them. It was also contended that the inquiry was into allegations of misconduct against Bakshi Ghulam Mohammad and an inquiry into allegations was not contemplated by the Inquiry Act. We are wholly unable to agree. An inquiry usually is into a question. That question may arise on allegations made. Dabnia 's case(1) dealt with an inquiry ordered at least in part into allegations made against people in charge of a big mercantile enterprise. Allegations may very well raise questions of great public importance. Suppose it is alleged that people in a city are suffering from ill health and that is due to the contaminated water supplied by the city admi nistration. It cannot be said that these allegations about the existence of poor health and its causes are not matters of grave public importance. They would be so even if it was found that the people 's health was not poor and the water was not contaminated. It cannot also be said that allegations can never be definite. They can be as definite as any existing concrete matter. It must depend on what the allegation is. Then as to the question whether the allegations against Bakshi Ghulam Mohammad were not matters of public importance because there was no public agitation over them. The Notification itself and the affidavits filed in this case on behalf of the appellants in fact state that there had been allegations made by the public against Bakshi Ghulam Mohammad that he had amassed a large fortune by the misuse of his office. But it was said that there was no proof that the allegations had actually been made. Whether there was proof would depend on whether the statements in the Notification and the affidavits were accepted or not. We are, however, unable to agree that a matter cannot be of public importance unless there was public agitation over it. Public may not be aware of the gravity of the situation. They may not know the facts. Some members of the public may be aware of individual cases but the entire public may not know all of them. There may have been influences working to prevent public agitation. Again, whe (1)[1959] S.C.R. 279. 409 ther a matter is of public importance or not has to be decided essentially from its intrinsic nature. If a matter is intrinsically of public importance, it does not cease to be so because the public did not agitate over it. Take this case. Suppose the Government sets up a Commission to inquire into the mineral wealth in our country. The public are not likely to agitate over this matter for they would not know about the mineral wealth at all. Can it be said that the inquiry does not relate to a matter of public importance because they did not agitate over it? The answer must plainly be in the negative. This would be so whether there were in fact minerals or not. Considering the allegations contained in the Notification by themselves, we think for the reasons earlier mentioned, that they constitute matters of public importance even if there was no public agitation over them. It was said that G. M. Sadiq, D. P. Dhar and various other people had praised the administration of Bakshi Ghulam Mohammad. That they no doubt did. But these were speeches made in support of party politics. They might again have been made without knowledge of full facts. They cannot, in any event, turn a matter of public importance into one not of that character. It was then pointed out that the Notification only mentioned that the matters were of public importance but did not say that they were definite matters of public importance. The Act, as we have earlier pointed out, requires that the matters to be inquired into shall be definite matters of public importance. But this omission of the word "definite" in the Notification does not, in our opinion, make any difference. A Court can decide whether the matters to be inquired into are definite matters of public importance. 'Definite ' in this connection means something which is not vague. One of the learned Judges of the High Court held that the matters set out in the second Schedule were vague as some of the instances did not give any date or year. He also said that the note at the end of the second Schedule., to which we have earlier referred, added to the vagueness. We are unable to accede to this view. What the learned Judge had in mind was apparently the particulars of the acts. In most cases, the acts are identifiable from the particulars given in the second Schedule in respect of them. Further, it is obvious that they had to be identified at the hearing and could not be proved nor any notice taken of them unless that was done. It does not appear to have been contended before the Commission that there was any matter not so identifiable. Neither do we think that the note drawing attention to the gravamen of the charges at the end of the second schedule indicates any indefiniteness. In most of the allegations it had been expressly stated that the act was done by the misuse of Bakshi Ghulam Mohammad 's official position and by his permitting others to exploit that it is this which made the matters, matters of public importance and it was for greater safety that the note was appended so that no 5SCI 28(a) 410 doubt was left as to the gravamen of the charge in each of the allegations made. The next point against the validity of the Notification was based on section IO of the Act which is in these terms: "10. (1) If at any stage of the inquiry the Commission considers it necessary to inquire into the conduct of any person or is of opinion that the reputation of any person is likely to be prejudicially effected by the inquiry, the Commission shall give to that person a, reasonable opportunity of being heard in the inquiry and producing evidence in his defence; Provided that nothing in this sub section shall apply when the credit of a witness is being impeached. (2)The Government, every person referred to in sub section (1) and with the permission of the Commission, any other person whose evidence is recorded by the Commission: (a) may cross examine any person appearing before the Commission other than a person produced by it or him as a witness, (b) may address the Commission. (3) It was contended that it showed that an inquiry may be made under the Act into the conduct of a person only incidentally, that is to say, it can be made only when that becomes necessary in connection with an inquiry into something else. It was, therefore, contended that the present inquiry which was directly into the conduct of Bakshi Ghulam Mohammad was outside the scope of the Act. It was also said that section 10 gives a statutory form to the rules of natural justice and provides for the application of such rules only in the case when a person 's conduct comes up for inquiry by the Commission incidentally. It was then said that the Act could not have contemplated an inquiry directly into the conduct of an individual since it did not provide specifically that he should have the right to be heard, the right to cross examine and the right to lead evidence which were given by section 10 to the person whose conduct came to be inquired into incidentally. We are unable to accept this view of section 10. Section 3 which permits a Commission of Inquiry to be appointed is wide enough to cover an inquiry into the conduct of any individual. It could not be a natu ral reading of the Act to cut down the scope of section 3 by an implication drawn from section 10. We also think that this argument is illfounded for we are unable to agree that section 10 does not apply to a person whose conduct comes up directly for inquiry before a Commission set up under section 3. We find nothing in the words of section 10 to justify that view. If a Commission is set up to inquire directly into the conduct of a person, the Commission must find 411 it necessary to inquire into that conduct and such a person would therefore, be one covered by section 10. It would be strange indeed if the Act provided for rights 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 inquired into under the order setting up the Commission. It would be equally strange if the Act contemplated the conduct of a person being inquired into incidentally and not directly. What can be done indirectly should obviously have been considered capable of being done directly. We find no justification for accepting the reading of the Act which learned counsel for Bakshi Ghulam Mohammad suggests. The next attack on the Notification was that it had been issued mala fide. One of the learned Judges of the High Court expressly rejected this contention and the others also seem to have been of the same view for they did not accept it. We find no reason to accept it either. In that view of the matter, we consider it unnecessary to discuss this aspect of the case in great detail. We have set out the broad events of the case and it is on them that the case of mala fide is based. It is not in dispute that for some time past there was political rivalry between Bakshi Ghulam Mohammad and G. M. Sadiq. It was also said that there was personal animosity because G. M. Sadiq wanted to advance the interest of his relatives and followers by ousting persons belonging to Bakshi Ghulam Mohammad 's group in various fields. This allegation of personal animosity cannot be said to have been established. It is really on the political rivalry and the events happening since September 21, 1964 that the allegation of male fide is founded. It was said that the steps taken since the arrest of Bakshi Ghulam Mohammad down to the setting up of the Commission of Inquiry were all taken with the intention of driving him out of the political life so that G. M. Sadiq would have no rival as a political leader. First, as to the arrest. The case of Bakshi Ghulam Mohammad was that the arrest was mala fide. On the other side, it was said that since about July 1964 various allegations of abuse of power by Bakshi Ghulam Mohammad some of which formed the subject matter of inquiry, had come to the notice of the Government and thereupon investigations were started by the Criminal Investigation Department at the instance of the Government. In order to stop the investigation Bakshi Ghulam Mohammad and his followers started dowdyism and other form of breaches of law and order endangering public safety and maintenance of public order. It was pointed out that the situation in Kashmir had not been easy for some time past due to the hostile intentions of Pakistan and China and breach of law and order added to the seriousness of the position. It was said that for these reasons Bakshi Ghulam Mohammad had to be arrested and detained under the Defence of India Rules. it was said on behalf of Bakshi Ghulam Mohammad that prior to the arrest, a no confidence motion had been sponsored and had actually gathered in volume and the arrest was made to stultify 412 it. What support the no confidence motion had we do not know. It would appear however that the Criminal Investigation Department had been making inquiries against Bakshi Ghulam Mohammad 's acts for some time past and the situation in Kashmir was inflammable. In those circumstances, it cannot be said that Bakshi Ghulam Mohammad 's arrest was mala fide. He was no doubt released from arrest after a petition had been moved for his release and before the petition was heard. It was said that he was released because the Government found that the petition was bound to succeed. We have no material before us on which we can say that the petition was bound to succeed. On behalf of G. M. Sadiq and D. P. Dhar it was said that he was released because of ill health. This does not appear to have been denied. It was also said on behalf of G. M. Sadiq that the investigation having been completed there was no cause for Bakshi Ghulam Mohammad to instigate breaches of law and order and therefore it was not necessary to keep him in detention any longer. On the evidence before us, we are unable to say that the case made by G. M. Sadiq cannot be accepted. As to the prorogation of the Assembly, it is said by the appellants that it was necessary because it was apprehended that if the Assembly met, there might have been trouble inside the House created by Bakshi Ghufam Mohammad 's followers who resented the arrest. On the materials before us, we are unable to say that this apprehension was pretended. It was also said by the appellants that the prorogation had been decided upon before the arrest of Bakshi Ghulam Mohammad but the order could not be passed because the Sadar i Riyasat was out of Srinagar from before September 15, 1964 when both the arrest and prorogation had been decided upon and did not return there till some time on September 21, 1964. The fact that the Sadar i Riyasat returned on that date is not denied. As we have said, the arrest and the prorogation took place on the next day, that is, September 22, 1964. Bakshi Ghulam Mohammad was released on December 15, 1964 and the Notification challenged was issued on January 30, 1965. On these facts, we are unable to hold that Bakshi Ghulam Mohammad has been able to establish that the inquiry had been set up mala fide owing to political rivalry. It has been said on behalf of the appellants that there could be no political rivalry because, as appears from Bakshi Ghulam Mohammad 's own affidavit, he had declared his intention to retire from politics. On behalf of Bakshi Ghulam Mohammad it was stated that G. M. Sadiq had made a statement that he would be released after a Commission of Inquiry was set up and this would show that the detention was mala fide and that would indicate that the Notification had also been issued mala fide. That statement is not before us. On behalf of G. M. Sadiq it was said that such a statement had not been made and what had been said was that he would be released after the completion of investigation by the Criminal Investigation Department as thereafter, there 413 will be no occasion for Bakshi Ghulam Mohammad to disturb the public peace and safety. It was also said that it had been mentioned that after the completion of the investigation, the Commission of Inquiry would be set up. This is not denied. It however does not make the arrest mala fide. It was further said by Bakshi Ghulam Mohammad that the statement showed that the Commission was set up to prevent him from disturbing public safety and law and order and that, therefore, it was outside the scope of the Inquiry Act. This was denied on behalf of G. M. Sadiq. In the absence of the statement, it is impossible for us to say which is the correct version. Another point taken was that the affidavits filed on behalf of the appellants showed that the Government were satisfied about the correctness of the allegations into which the inquiry was directed. It was contended that since the inquiry is for finding facts, if the Government were already satisfied about them, there was no need for further inquiry. This contention has no force at all. What the affidavit really said was that the Government were prima facie satisfied. They had to be so before they could honestly set up the Commission to make the inquiry. It was said on behalf of G. M. Sadiq that before setting up the Commission the Government had investigated into the facts through the Criminal Investigation Department and if the Government 's intention was mala fide, they could have started criminal proceedings and ruined the political life of Bakshi Ghulam Mohammad just as well thereby and kept him busy and out of politics for a long time. It was pointed out that this might have resulted in serious consequences for Bakshi Ghulam Mohammad which the Commission of Inquiry would not. It was also pointed out that the Commissioner appointed was a retired Judge of the Supreme Court of India. All this, it was said, would indicate that the action had not been prompted by malice. We cannot say that these contentions of the appellants have no force. The next ground of attack on the Notification was based on article 14. It was said that most of the matters into which the Commission had been directed to inquire formed the subject matters of Cabinet decisions. It was pointed out that since such matters are confidential and no one is allowed to divulge in what way the members of the Cabinet voted on them, it must be held that they were all equally responsible for the acts sanctioned. That being so, it was contended that by picking Bakshi Ghulam Mohammad out of the entire Cabinet for the purpose of the Inquiry the Government had discriminated against him in a hostile way. It was contended that the Notification must be set aside on that ground. We find this contention untenable. The inquiry is in respect of wealth acquired by Bakshi Ghulam Mohammad and his friends and relatives by misuse of his official position. It would be strange if all the members of the Cabinet voluntarily abused their office for putting money into the pockets of Bakshi Ghulam Mohammad and his friends. Let us, however, assume that all the 414 members of the Cabinet assisted Bakshi Ghulam Mohammad in doing this. It is however not said that other members had acquired wealth by these acts. He was, therefore, in a class by himself. This classification has further a rational connection with the setting up of the Commission, for the object is to find out whether the wealth had been acquired by Bakshi Ghulam Mohammad by the abuse of official position. It remains now to deal with the last point. This was directed against the proceedings of the Commission. It was said that the proceedings had been conducted in a manner contrary to the rules of natural justice and to statutory provisions. Two specific complaints were made. The first was that the Commission had not allowed Bakshi Ghulam Mohammad to inspect all the documents before he was called upon to answer the allegations made against him. The second was that the Commission had refused him permission to cross examine persons who had filed affidavits supporting the allegations made against him. We have now to set out the procedure followed by the Commission. It first called upon the Government to file affidavits in support of the allegations in the second schedule to the Notification and to produce the documents which supported them. It then asked Bakshi Ghulam Mohammad to file his affidavit in answer. Thereafter the Commission decided whether any prima facie case had been made for Bakshi Ghulam Mohammad to meet and in that process rejected some of the allegations. Bakshi Ghulam Mohammad was told that there was no case, which be had to meet in respect of them. Out of the remaining allegations, a group was selected for final consideration and it was decided that the rest would be taken up gradually thereafter. In connection with that group of cases, counsel for Bakshi Ghulam Mohammad wanted to cross examine all the persons who had filed affidavits supporting the Government 's allegations in the cases included in that group. The Commissioner ordered that he would not give permission to cross examine all the deponents of affidavits but would decide each case separately. It was after this that the petition for the writ was presented. The question of inspection is no longer a live question. It is true that when Bakshi Ghulam Mohammad was directed to file his affidavits he had not been given inspection of ' all the documents and files which the Government proposed to use to support their case. On behalf of Bakshi Ghulam Mohammad it was said that this was a denial of the rules of natural justice. It is not necessary to consider this question because it is admitted that since then inspection of the entire lot of files and documents has been given. At the final hearing of the allegations, therefore, Bakshi Ghulam Mohammad would no longer be at any disadvantage. The next point is as to the right of cross examination. This claim was first based on the rules of natural justice. It was said 415 that these rules require that Bakshi Ghulam Mohammad should have been given a right to cross examine all those persons who had sworn affidavits supporting the allegations against him. We are not aware of any such rule of natural justice. No authority has been cited in support of it. Our attention was drawn to Meenglas Tea Estates vs Their Workmen(1), but there all that was said was that when evidence is given viva voce against a person be must have the opportunity to hear it and to put the witnesses questions in cross examination. That is not our case. Furthermore, in Meenglas Tea Estate case(1) the Court was not dealing With a fact finding body as we are. Rules of natural justice require that a party against whom an allegation is being inquired into should be given a hearing. Bakshi Ghulam Mohammad was certainly given that It was said that the right to the hearing included a right to cross examine. We are unable to agree that is so. The right must depend upon the circumstances of each case and must also depend on the statute under which the allegations are being inquired into. This Court has held in Nagendra Nath Bora vs Commissioner of Hills Division and Appeals, Assam(1) that "the rules of natural justice vary with the varying constitution of statutory bodies and the rules prescribed by the Act under which they function; and the question whether or not any rules of natural justice had been contravened, should be decided not under any preconceived notions, but in the light of the statutory rules and provisions. " We have to remember that we are dealing with a statute which permits a Commission of Inquiry to be set up for fact finding purposes. The report of the Commission has no force proportion vigorous. This aspect of the matter is important in deciding the rules of natural justice reasonably applicable in the proceedings of the Commission of Inquiry under the Act. 'Then we find that section 10 to which we have earlier referred, gives a right to be heard but only a restricted right of cross exaniination. The latter right is confined only to the witnesses called to depose against the person demanding the right. So the Act did not contemplate a right of hearing to include a right to crossexamine. It will be natural to think that the statute did not intend that in other cases a party appearing before the Commission should have any further right of cross examination. We, therefore. think that no case has been made out by Bakshi Ghulam Mohammad that the rules of natural justice require that lie should have a right to cross examine all the persons who had sworn affidavits supporting the allegations made against him. We will now deal with the claim to the right to cross examine based on statutory provision. That claim is based on section 4(c) of the Act. The relevant part of the section is as follows: "The Commission shall have the power of a Civil Court. while trying a suit under the Code of Civil Proce (1) ; (2) ; 416 dure Svt. 1977, in respect of the following matters, namely: (a) summoning and ao enforce the attendance yof an person and examining him on oath; (b) (c) receiving evidence on affidavits" ' It is not in dispute that the Code of Civil Procedure of Jammu and Kashmir State referred to in this section is in the same terms as the Indian Code of Civil Procedure. Order 19 r. I. of the Indian Code reads as follows: "Any Court may at any time for sufficient reason order that any particular fact or facts may be proved by affidavit, or that the affidavit of any witness may be read at the hearing, on such conditions as the Court thinks reasonable: Provided that where it appears to the Court that either party bona fide desires the production of a witness for cross examination, and that such witness can be produced, an order shall not be made authorising the evi dence of such witness to be given by affidavit. " The contention is that the powers of the Commission therefore to order a fact to be proved by affidavit are subject to the proviso that power cannot be exercised when a party desires the production of the persons swearing the affidavits for cross examining them. The contention was accepted by the High Court. We take a different view of the matter. We first observe that the inquiry before the Commission is a fact finding inquiry. Then we note that section 10 which, in our opinion, applies to a person whose conduct comes up for inquiry by the Commission directly, has a right to cross examine only those persons who give viva voce evidence before the Commission against him. If section 4(c) conferred a right to cross examine every one who swore an affidavit as to the facts involved in the inquiry, then section 10(2) would become superfluous. An interpretation producing such a result cannot be right. It also seems to us that O. 19 r. I has to be read with O. 18 r. 4 which states that the evidence of the witnesses in attendance shall be taken orally in open court. It would appear, therefore, that O. 19 r. I. is intended as a sort of exception to the provisions contained in O. 18 r. 4. The Act contains no provision similar to O. 18 r. 4. Therefore, when section 4(c) of the Act gave the Commission the power of receiving evidence on affidavits, it gave that as an independent power and not by way of an exception to the general rule of taking evidence viva voce in open court. It would be natural in such circumstances to think that what the Act gave was only the power 417 to take evidence by affidavit and did not intend it to be subject to the proviso contained in O. 19 r. I. If it were not so, then the result really would be to require all evidence before the Commission to be given orally in open court. If that was intended, it would have been expressly provided for in the Act. We should here refer to Khandesh Spinning etc. Co. Ltd. vs Rashtriya Girni Kamgar Sangh(1) where this Court dealing with a somewhat similar section like section 4(c) observed that facts might be proved by an affidavit subject to O. 19 r. (1). The observations appear to have been obiter dicta. In any case that case was dealing with a statute different from the one before us. The observation there made cannot be of much assistance in interpreting the Jammu and Kashmir Inquiry Act. The number of witnesses swearing affidavits on the side of the Government may often be very large. In fact, in this case the number of witnesses swearing affidavits on the side of the Government is, it appears, in the region of four hundred. The statute could not have intended that all of them had to be examined in open court and subjected to cross examination, for then, the proceedings of the Commission would be interminable. We feel no doubt that the Act contemplated a quick disposal of the business before the Commission, for, otherwise. the object behind it might have been defeated. While on this topic, we would impress upon the Commission the desirability of speedy disposal of the inquiry. For these reasons, in our view, section 4(c) of the Act does not confer a right on a party appearing before the Commission to require a witness giving evidence by an affidavit to be produced for his cross examination. The Commission would, of course, permit cross examination in a case where it thinks that necessary. The view that we take should not put any party in any difficulty. He can always file affidavits of his own denying the allegations made in affidavits filed on behalf of the other party. If the evidence on both sides is tendered by affidavits, no one should be at any special disadvantage. We have also to remember that section 9 of the Act gives the Commission power to regulate its own procedure subject to any rules made under the Act. We find that the rules provide that evidence may be given by affidavits and the Commission may after reading it, if it finds it necessary to do so, record the evidence of the deponents of the affidavits and also of others; see ff. 6, 7 and 8. Rule 10 reproduces the restricted right of cross examination given by section 10. Rule 11 says that in all matters not provided by the rules, the Commission may decide its own procedure. One of the matters covered by the rules is cross examination of witnesses. So the rules contemplate cross examination as a matter of procedure and the Commission is free to decide what cross examination it will allow provided that in doing so it cannot go behind the rules relating to cross examination. Section 9 of the Act has to be read in the light of these rules. All this. we think, supports (1)[1060] 2 S.C.R. 841. 418 the interpretation we have put on section 4(c). We also feel that the procedure before a body like the Commission has necessarily to be flexible. We, therefore, reject the last contention. In our view, for these reasons, the judgment of the High Court cannot be supported. We accordingly set it aside. The appeal is allowed. Appeal allowed.

The first respondent became a member of the Council of Ministers of the State of Jammu and Kashmir in 1947 and was the Prime Minister of the State from 1953 'to January 1963, when he resigned. Thereafter a Notification was issued by the State Government under section 3 of the Jammu and Kashmir Commission of Inquiry Act 1962 setting up a Commission to inquire into the wealth, acquired by the first respondent and certain specified members of his family during his period of office; the Commission was also to inquire whether in acquiring this wealth there was any abuse of his official position by the first respondent or the said relatives. The Commissioner so appointed held certain sittings between February 1965 and August 1965 in which the first respondent took part. In September 1965 he filed a writ petition before the High Court of Jammu and Kashmir and the High Court, allowing the said petition, set aside the Notification instituting the inquiry and quashed the proceedings of the Commission. The State appealed to the Court. HELD: (i) Section 37 of the Constitution of Jammu and Kashmir talks of the collective responsibility of Ministers to the Legislative Assembly. That, only means that the Council of Ministers will have to stand or. fall together, every member being responsible for the action of any other. The section does not mean that a Minister is responsible for his acts only to the Legislature and no action can be taken against him except for criminal or tortuous acts, in the ordinary course of law, unless the Legislature by a resolution demanded it. No British convention to this effect, if any, can be said to have been adopted by section 37. Furthermore, the responsibility to the Legislature is of the Council of Ministers, and not of those who have, like the first respondent ceased to be Ministers. [405C E]. (ii)Section 3 of the Commission of Inquiry Act expressly gives power to Government as well as to both the Houses of Legislature to initiate action instituting an inquiry. When enacting it the Legislature obviously did not consider that there was any convention or anything in section 37 which prevented a Commission of Inquiry being set up under the Act at the instance of the Government or the Legislative Council. [405F G], (iii)The acts of a Minister while in office do not cease to be matters of public importance after he ceases to hold office; their character cannot change. When it is alleged that a Minister has acquired vast wealth for himself and his friends by abuse of his official ' position, there can be no question that the matter is of public 402 importance. It does not cease to be of public importance merely because what is proposed is to inquire into allegations and not into the steps to be taken to prevent lapses in the future. Nor can absence of public agitation show that the facts to be inquired into are not of, public importance. [407E G; 408 G] Ram Krishan Dalmia vs Shri Justice section R. Tendolkar, ; , referred to. (iv) It is incorrect to say that) allegations mentioned are not definiteor that an inquiry into them is not contemplated by the Inquiry Act. [409 E F] (v) It cannot be inferred from the provisions of section 10 of the Act that a Commission of Inquiry can inquire into the conduct of a person only incidentally, when the main inquiry is in respect of something else. What can be done indirectly should obviously have been considered capabe of being done directly. [411B] (vi)On the facts of the case the inquiry could not be said to be mala fide. [412F] (vii)The. doctrine of Cabinet responsibility does not mean that if an inquiry was made against one of the members of the Cabinet that would be discrimination under article 14. The respondent was in a class, by himself and the classification was justified. [414A B] (viii)The rule of natural justice only requires that a hearing should be given. When the Commission refused permission to the first respondent to cross examine all the witnesses who had filed affidavits against him no rule of natural justice was violated. [415G] Meenglas Tea Estate V. Their Workmen, [1964]2 S.C.R. 165 and Nagendra Nath Bora vs Commissioner of Hills Division & Appeals, ,Assam ; (ix)Section 10 of the Act gives a right to cross examine only these persons who give viva voce evidence before the Commissioner. [416F] (x)Section 4(c) of the Act does not confer a right on a party appearing before the Commission to require a witness giving evidence by affidavit to be produced for his cross examination. The Commission would, of course, permit cross examination in a case where it thinks that necessary. [417E]

ion No. 91 of 1964. Petition under article 32 of the Constitution of India for the enforcement of fundamental rights and Civil Appeal No. 358 of 1966. Appeal by special leave from the judgment and order dated September 9, 1963 of the Allahabad High Court in Civil Writ Petition No. 1885 of 1962. J.P. Goyal and Raghunath Singh, for the petitioner (in W.P. No. 91 of 1964). A.K. Sen, J. P. Goyal and Raghunath Singh, for the appel lants (in C.A. No. 358/66). B.Sen and section P. Nayar, for respondent No. 1 (in W.P. No. 91 of 1964) and respondents Nos. 3 and 4 (in C.A. No. 358 of 1966). N.N. Sharma, for respondent No. 2 (in W.P. No. 91/64) and respondents Nos. 16 and 17 (in C.A. No. 358/66). 843 The Judgment of the Court was delivered by Bbargava, J. This writ petition and the appeal challenge the validity of the Hindi Sahitya Sammelan Act No. 13 of 1962 (hereinafter referred to as "the Act"). The facts leading up to the passing of this enactment are that, in the year 1910, some eminent educationists assembled at Banaras and founded an Association for the development of Hindi and its propagation throughout the country. This Association was named as the Hindi Sahitya Sammelan. On the 8th January, 1914, it was registered as a Society under the No. 21 of 1860, with Head Office at Allahabad, under the name of Hindi Sahitya Sammelan. The rules and bye laws of the Society laid down the objects of this Association and the manner of its working. It had three classes of members, viz., special members (Vishisht Sadasya), permanent members (Sthayi Sadasya), and ordinary members (Sadharan Sadasya). Under the bye laws, apart from the original members constituting the Society, further mem bers could be admitted under these three classifications on being elected by the working committee of the Society. Under the Rules and bye laws of the Society, other bodies could be constituted for carrying on activities of the Society. These included a Governing Body, a Working Committee, a Hindi University Council, Literary Council (Sahitya Samiti), Library Committee, Parchar Samiti and Rashtriaya Bhasha Prachar Samiti. Through the agencies of these various Committees, the Society carried on the work of development and propagation of Hindi, of spreading the use of Devnagri scrip, of holding examinations, and of confer ring Degrees for proficiency in Hindi. The Society owned landed properties and buildings at Allahabad as well as at some other places such as Warding, and was holding considerable funds for carrying on its activities. The Society worked very successfully for a number of years. It appears that in the year 1950, some differences arose between the members of the Society, and attempt was made to alter the constitution, of the Society. while one section wanted the alterations, another section was opposed to it. This resulted in litigation. Three different suits were instituted in the civil Courts at Allahabad in this connection and injunctions were sought by one party against the other. Ultimately, the Court appointed a Receiver. In view of these circumstances, the U.P. Legislature passed an Act known as the U.P. Hindi Sahitya Sammelan Act No. 36 of 1956, under which a statutory body was created under the name of Hindi Sahitya Sammelan, and the word "Sammelan" was defined as referring to the Hindi Sahitya Sammelan constitu ted under the Act. Under that Act. Under that Act, the mana 844 gement and properties of the original Hindi Sahitya Sammelan, which was a registered Society, were to be taken over by the new statutory Sammelan. That Act was, however, declared void by the Allahabad High Court on the ground that Act had made the original Sammelan cease to exist and provided for the constitution of a new Sammelan under its terms in which the members of the original Sammelan had no say, so that Act infringed the right of the members of the original Sammelan of forming an association guaranteed by article 19 (1) (c) of the Constitution. It was further held that Act was not saved under article 19(4) of the Constitution. Thereafter, the present Act, now challenged in this writ petition and the appeal, was passed by Parliament under Entry 63 of List I of the Seventh Schedule to the Constitution. The Act itself, in section 2, contained the necessary declaration to give legislative competence to Parliament under that Entry. The Act first contained in section 2 a declaration in the following words : "Whereas the objects of the institution known as the Hindi Sahitya Sammelan which has its head office at Allahabad are such as to make the instituation one of national importance, it is hereby declared that the institution known as the Hindi Sahitya Sammelan is an institution of national importance. " Having declared this institution as an institution of national importance, th. , Act proceeded to define "Sammelan" as meaning the institution known as the Hindi Sahitya Sammelan incorporated under this Act, while the word "Society" was defined to mean "the Hindi Sahitya Sammelan which has its head office at Allahabad and is registered under the ." Under section 4(1) of the Act, the Sannnelan was constituted which was to consist of the first members of the Sammelan and all persons who may hereafter become members thereof in accordance with the rules made in that behalf. This statutory Sammelan was constituted as a body corporate by the name of the Hindi Sahitya Sammelan, and under sub section (2) of section 4, it was to have perpetual succession and a common seal with power, subject to the provision of the. Act, to acquire, hold and dispose of property and to contract and to sue and be sued by that name. The Head Office of the Sammelan was to be at Allahabad. Under subs.(4) of section the first members of the Sammelan were to consist of persons who, immediately before the appointed day. (a) were special members (Vishisht Sadasya) of the Society; 8 45 (b) (were. life members (Sthayi Sadasya) of the Society. (c) had been Presidents of the Society; or (d) were awarded the Mangla Prasad Paritoshik by the Society. This sub section (4) of section 4 was amended retrospectively with effect from the date that the Act came into force by the Hindi Sahitya Sammelan (Amendment) Act No. 1 of 1963, and the first members of the Sammelan were, under this amendment, declared to be (a) all persons who, immediately before the appointed day, were members of the Society; (b) all persons who, before that day, had been Presidents of the Society; and (c) all persons who, before that day, were awarded the Mangla Prasad Paritoshik by the Society. It is not necessary to give in detail the other provisions of the Act, except that it may be mentioned that the Act provided for vesting of all property, movable or immovable, or, belonging to the Society in the Sammelan, transferring all rights and Liabilities of the Society to the Sammelan, converting reference to the Society in any law to the Sammelan, and other similar necessary provisions. The Act itself did not make any provision for the future membership of the Sammelan; but, under section 12(1) (a), the first Governing Body of the Sammelan was directed to make rules in respect of matters relating to membership, including qualifications and disqualifications For membership of the Sammelan. The first Governing Body was to be constituted under section 8 and was to consist of a Chairman, a Secretary and 13 other members. This Governing Body was to be constituted by a notification in the Official Gazette by the Central Government. The thirteen members were to be chosen as follows : (i) one member to represent the Ministry of the Central Government dealing with education; (ii)one member to represent the Ministry of the Central Government dealing with finance; (iii)not more than three members from among the former Presidents of the Society; and (iv)the remaining number from among persons who are, in the opinion of the Central Govern 846 ment, eminent in the field of Hindi language or Hindi literature. It was this first Governing Body which was to make rules on all matters relating to membership of the Sammelan under section 12 (1 )(a) of the Act. These rules were not have effect until they were approved by the Central. Government and were published by the first Governing Body in such manner as the Central Government may, by order, direct. A copy of the rules was also to be laid before each House of Parliament. Counsel for respondent No. 1 placed before us a copy of the rules which, according to him, have been made by the first Governing Body with the approval of the Government and have been published as required. The Rules come into force on 1st of February, 1971. The petition under article 32, and the petition under article 226, out of which the civil appeal arises, were both moved much earlier and long before these Rules were framed. These petitions challenged the validity of the Act, without taking into account the actual Rules framed, mainly on the ground that he Act had interfered with the right of the petitioners to form association Linder article 19(1)(c) of the Constitution and was not protected by article 19(4). In the petition before the Allahabad High Court, the Court held that, since all the members of the Society had also become members of the Sammelan under the Act, there was no infringement of the right to form association, so that the Act could not be declared invalid on that ground. The writ petition in this Court has been filed by only one member of the Society, while the petition in the High Court and the appeal against the judgment of the High Court, which is before us, were filed by the original Hindi Sahitya Sammelan as one party and 72 members of that Sammelan joining as other petitioning parties. 'In the civil appeal, thus, the grievance that the Act ha$ infringed the fundamental right has been put forward both by the Society itself as well as by 72 of its members, including members of the Working Committee and the Governing Body of the society. They have all come up to this Court against the decision of the High Court in this appeal by special leave. In the counter affidavits filed on behalf of the respondents in the writ petition before the High Court as well as in the writ petition in this Court, the position taken up was that the Act, in fact, does not deprive the Society and its members of any rights which they had under the constitution of the Society and did not interfere with their right of association inasmuch as all the members of the Society have been included as members of the Sammelan under the Act. The High Court, in fact, dismissed the writ petition on accepting this submission put forward on behalf of the respondents. In the arguments before us, learned counsel for 847 respondent No. 1, however, took UP a different position and urged that the Act keeps the Society in tact as it was, where a new Sammelan is constituted under the Act for the purpose of managing the institution which has been declared as an institution of national importance. He put this aspect of the case in the forefront, but, in the alternative, he also argued the case on the basis of the position taken up in the counter affidavits in the High Court and in this Court as mentioned above. We consider it convenient to first deal with the case as was specifically put forward in the counter affidavits. In these counter affidavits, the position taken up is that, having declared the old Hindi Sahitya Sammelan, which was a Society registered under the , as an insti tution of national importance, Parliament has proceeded to legislate in respect of it under Entry 63 of List I of the Seventh Schedule in order that its administration may not suffer as a result of the quarrels that were going on inter se between the members of the Society. It was for this purpose that a first Governing Body was constituted to take over the management temporarily. The Act was designed to reconstitute the Sammelan in such manner that it could work successfully and without difficulties and, in making provision for this purpose, all members of the old Society were included as members of the Sammelan, so that their right of forming association may not be taken away from them. The Society was never dissolved; instead of the Society remaining a body registered under the , it was converted into a statutory Sammelan under the Act. It, however, appears on examination of the provisions of the Act that the Sammelan under the Act is composed not only of persons, who were members of the Society, but of others who have been given the right to be members of the Sammelan without the consent of the preexisting members. Under section 4(4) itself, as retrospectively amended in 1963, apart from persons, who were members of the Society, others, who have been made members of the Sammelan, are all persons who, before that day, had been Presidents of the Society and all persons who, before that day, were awarded the Mangla Prasad Paritoshik by the Society. These members have been added without any option being available to the existing members of the Society to elect or refuse to elect them as members which was the right they possessed under the constitution of the Society itself. Further, under section 12 (1) (a), very wide powers were given to the first Governor Body to make rules in respect of matters relating to membership, including qualifications and disqualifications for membership of the Sammelan. Under this power, the rules framed could make 10 L1100 SupCI71 848 provision for admission of persons as members whom the original members of the Society may never have liked to admit in their Society. The number of such new members could even be so large as to leave the original members in a small minority with the result that those members could become totally ineffective in the Society. Even in the Rules actually framed, there is provision for admission of members under various classes. In addition to the persons mentioned in section 4(4) of the Act, Rule 6 proVides for membership of persons who may become Sabhapatis of the Sammelan for any annual session subsequent to the Act coming into force, and persons who may be awarded Mangala Prasad Paritoshik subsequent to the Act coming into force. Under Rules 7, 8, and 9, new Vishisht Sadasyas, Sthayi Sadasyas, and Sadharan Sadasyas can be admitted to the membership of the Sammelan on payment of Rs. 1,000/ or Rs. 300/ , as the case may be. This admission to membership, according to the Rules, will be made by the new Karya Samiti to be elected under the Rules and not by the Working Committee of the original members of the Association. Further, under section 7(2) of the Act, the Governing Body of the new Sammelan is to consist of such number of persons, not exceeding 55, as the Central Government may from time to time determine; and out of these, a number not exceeding 7 are to be nominated by the, Central Government from among educations of repute and eminent Hindi scholars. These 7 nominees are to be chosen by the Central Government and on becoming, members of the Governing Body, under Rule. 11 they become members of the Sammelan. Under Rule 10, educational institutions can also be admitted as Sanstha Sadasyas of the Sammelan by the new Karya Samiti and, thereupon, a representative of each of such institution has right to participate in ' proceedings of the Sammelan, exercising all the rights of a member. It will, thus, be seen that the Sammelan, which has come into existence under the Act, is not identical with the Sammelan which was registered as a Society under% the . Certain persons have been added as members by the Act and by the Rules. Admission of future members is no longer at the choice of the original members who ' had formed the Asso ciation,Persons, in whose admission as members the members of the, Society, had no hand, can become members and get the right of associating with them in the Sammelan, without the original members having any right to obecti. this is clear interference with the right to form an association which had been exercised by the members of the Society by forming the Society with its constitution, under which they were members and future members could only come in as a result of their choice by being elected by their Working Committee. We are unable to agree with the High Court that the new Sammelan, as constituted under the Act, 849 is identical with the Society and that all the rights of forming an association, which were being exercised by members of the Society, have been kept in tact under the Act. It was argued that the right guaranteed by Article 19 (1 (c) is only to form an association and, consequently, any regulation of the affairs of the Association, after it has been formed, will not amount to a breach of that right. It is true that it has been held by this Court that, after an Association has been formed and the right under article 19 (1) (c) has been exercised by the members forming it, they have no right to claim that its activities must also be permitted to be carried on in the manner they desire. Those cases are, however, inapplicable to the present case. The Act does not merely regulate the administration of the affairs of the Society, what it does is to alter the composition of the Society itself as we have indicated above. The result of this change in composition is that the members, who voluntarily formed the Association, are now compelled to act in that Association with other members who have been imposed as members by the Act and in whose admission to membership, they had no say. Such alteration in the composition of the Association itself clearly interferes with the right to continue to function as members of the Association which was voluntarily formed by the original founders. The right to form an association, in our opinion, necessarily, implies that the persons forming the Association have also the right to continue to be associated with only those whom they voluntarily, admit in the Associate on. Any law, by which members are introduced in the voluntary Association without any option being given to the members to keep them out, or any law which. takes away the membership of those who have voluntarily Joined it, will be a law violating the right to form an association. If we were to accept the submission that the right guaranteed by article 19 ( 1 ) (c) is confined to the initial stage of forming an Association and does not protect the right to continue the Association with the membership, either chosen by the founders or regulated by rules made by the Association itself, the right would be meaningless because, as soon as an Association is formed, a law may be passed interfering with its composition. , so that the Association formed may not be able to function at all. The right can be effective only if it is held to include within it the right to continue the, Association with its composition as voluntarily agreed upon by the persons forming the Association. This aspect was recognised by this Court though not in plain words, in the case of O. K. Ghosh and Another vs E. X. Joseph("). The Court, in that case. was considering the validity of Rule 4 (B) of the Central Civil Service,,, (Conduct) Rules, 1955, which laid down that: (1)[1963] Supp 3 S.C.R. 789. 850 "No Government servant shall join or continue to be a member of any Service Association of Government servants (a)which has not, within a period of six months from its formation, obtained the recognition of the Government under the Rules prescribed in that behalf; or (b)recognition in respect of which has been refused or withdrawn by the Government under the said Rules. " This Court held: "It is not disputed that the fundamental rights guaranteed by article 19 can be claimed by Government servants. article 33 which confers power on the Parliament to modify the rights in their application to the Armed Forces, clearly brings out the fact that all citizens including Government servants, are entitled to Claim the rights guaranteed by article 19. Thus, the validity of the impugned rule has to be judged on the basis that the respondent and his co employees are entitled to form Associations or Unions. It is clear that Rule 4 B imposes a restriction on this right. It virtually compels a Government servant to withdraw his membership of the Service Association of Government Servants as soon as recognition accorded to the said citation is withdrawn or if, after the Association is formed, no recognition is Aaccorded to it within six months. In other words, the right to form an Association is conditioned by the existence of the recognition of the said Association by the Government. If the Association obtains the recognition and continues to enjoy it, Government servants can become members of the said Association; if the Association does not secure recognition from the Government or recognition granted to it is withdrawn, Government servants must cease to be the members of the said Association. That is the plain effect of the impugned rule. " The Court in the above passage, thus, accepted the principle that the Government servants, who may have formed an Association. could not, be compelled to resign from it by imposition of a condition of recognition of this Association by the Government and that if the Government servants are required to cease to be members that would be a violation of the right under article 19 (1) (c). The Court, of course, in that case, further proceeded 'to examine whether such a restriction on the right could be justified under 851 article 19(4) or not. That case, thus, supports our view that the right to form an Association includes the right to its continuance and any law altering the composition of the Association compulsorily will be a breach of the right to form the Association. This Court had also proceeded on the same basis in the case of State of Madras vs V. G. Row(1). Though this aspect was not clearly brought out in the judgment, the point, which came up for consideration, was decided on the basis that persons forming, an Association had a right under article 19 (1) (c) to see that the composition of the Association continues as voluntarily agreed to by them. That decision was given in an appeal from a judgment of the High Court of Madras reported in V. G. Row,v. The State of Madras(2). In the High Court, this principle was clearly formulated by Rajamannar, C.J., in the following words : "The word "form" therefore, must refer not only to the initial commencement of the association, but also to the continuance of the association as such. " The Act, insofar as it interferes with the composition of them Society in constituting the Sammelan, therefore, violates the right of the original members of the Society to form an association guaranteed under article 19(1) (c). Article 19(4), on the face of it, cannot be called in aid to claim validity for the Act. Under article 19(4), reasonable restrictions can be imposed only in the interests of the sovereignty and integrity of India, or in the interests of public order or morality. It has not been contended on behalf of the respondent, nor could it be contended that this alteration of the constitution of the Society in the manner laid down by the Act was. in the interests of the sovereignty and integrity of India, or in, the interests of public order or morality. Not being protected under article 19(4), if must be held that the provision contained, in the Act for reconstituting the Society into the Sammelan is, void. Once that section is declared void, the whole Act becomes. ineffective inasmuch as the formation of the new Sammelan is the very basis for all the other provisions contained in the Act. In view of this position emerging in the course of argu ments, Mr. B. Sen put forward an entirely different and alter native case before us which we have mentioned earlier. position he took up was that the Act nowhere specifically lays. down that the Society small stand dissolved, while it does constitute a new Sammelan. According to him, therefore, it should (1) ; (2) A.I.R. 1951 Mad. 852 be inferred that, while the Society still continues to exist in its original form, the law has brought into existence a new Sammelan to which all the functions, properties, etc. of the Society have passed under the Act. There are three reasons why this alternative submission cannot be accepted as ensuring the validity ,of the Act. The first is that the specific case taken by the respondents has been that the Act reconstitutes the Society and does not create a separate and indepedent body in the form of a new Sammelan. Secondly, even if it be accepted that a new Sammelan has been constituted by the Act, the question will ,arise of the Legislative competence of Parliament to pass such :a law. Constitution of Societies is under List 11 of the Seventh Schedule. Parliament purported to exercise legislative power under Entry 63 of List I on the basis of a declaration that the Hindi Sahitya Sammelan, Allahabad was an institution of national importance. The institution that was declared was the Society itself. It was not a case where the Society could be distinguished from some other institution which might have been declared as an institution of national importance There can, of course, be cases where a Society may be running a college, a school or some other like institution, in which case Parliament may declare that particular institution as of national importance, without declaring the Society as such In the present case, what section 2 of the Act did was to declare the Society itself as an institution of national importance, and, consequently, Parliament became competent to legislate in respect of the Society. On the interpretation now sought to, be put forward, the Act keeps that Society in tact, but deprives it of all its functions and properties and transfers them to 'a newly constituted body, viz., the Sammelan, as defined under the Aet. This Sammelan is itself a body corporate, and that Sammelan has never been declared as an institution of national importance. The only institutaion that was declared as of national importance was the Society which, of course, earlier, carried the same name as the new Sammelan. Parliament was, therefore, not competent to legislate in respect of this newly constituted Sammelan which, at no stage, had been declared as an institution of national importance. The third reason why this submission must be rejected, is that, if we were to hold that Parliament pased this Act so as to transfer all the properties and assets of the Society to the Sammelan, the Act would contravene article 19(1)(f) of the Constitution. On this interpretation, what the Act purports to do is to take away all the properties of the Society, leaving the Society as an existing body, and give them to the new Sammelan. This Sammelan is a new, separate and distinct legal entity from the Society. The Society is, thus ' deprived of all its properties by the Act. Such a law depriving the Society of its properties al 8 5 3 together cannot be held to be a reasonable restriction in the public interest on the right of the Society to hold the property. The property, under section 5 of the , vested in the Governing Body of the Society. The members of the Governing Body, therefore had the right to hold the property under article 19(1)(f) and they having been deprived of that property have rightly approached the Courts for redress of their grievance. In this connection counsel for the respondents relied on decision of this Court in The Board of Trustees, Ayurvedic and Unnanii Tibia College, Delhi vs The State of Delhi and Another(1), where the Board of Trustees of the Ayurvedic and Unani Tibbit College, Delhi was dissolved by the Tibbia College Act, 1952, and the property, which had vested in the Board of Trustees, passed to the newly constituted Board under the impugned Act. The Court held that there was no violation of the fundamental rights guaranteed by article 19(1)(f) or article 31 That decision, however, proceeded on the basis that the property of the original Society registered under the had vested in the Board of Trustees which had been dissolved and the property, thereafter, did not vest in the members of the Society in view of the provisions of the Act of 1860. In these circumstances, it was held that no one could complain that his right to property under article 31 or his right to hold the property under article 19 (1) (f) had been violated by the impugned Act. In the present case, the applicability of article 19(1)(f) is being considered by us on the assumption that the old Society still exists as it was and, yet all its properties have been transferred to the Sammelan. If the Society still exists, so does its Governing Body in whom the property of the Society vested. The Act, thus, deprives the members of the Governing Body of the property which still continued to vest in them in spite of the passing of the Act. This total deprivation of property, instead of regulating the management of the affairs of the Society or its properties, cannot clearly be justified as a reasonable restriction in public interest. It is true that, at the time when the Act was passed, litigation was going on between the members of the Society, and the affairs of the Society were probably in a mess. The remedy, however, could not lie in depriving the Society of its property altogether. Reasonable restrictions could have been imposed so as to ensure the proper preservation of the property of the Society and its proper management. If the law is passed not merely for ensuring proper management and administration of the property, but for totally depriving the persons, in whom the property vested, of their (1) [1962] Suppl. I S.C.R. 156. 854 right to hold the property, the law cannot be justified as a reasonable restriction under article 19(5). Consequently, even on this alternative position taken up by counsel for the respondents, the Act cannot be held to be valid. As a result, the petition and the appeal are both allowed with costs. The Act is declared to be invalid, so that there will be restraint on the concerned bodies, including the Union Government, from taking or continuing any action under the Act. There will be one hearing fee. R.K.P.S. Petition and Appeal allowed.

The Hindi Sahitya Sammelan (hereinafter referred to as the Society) was a registered society founded for the development and propagation of Hindi. After a number of years of its successful working differences arose between its members and this resulted in litigation. in 1956 the Uttar Pradesh legislature passed the U.P. Sahitya Sammelan Act, under which a statutory body was created under the name of Hindi Sahitya Sammelan. This act was declared void by the Allahabad High Court as violating the freedom of association guaranteed under article 19(1)(c) of the Constitution. Thereafter, Parliament enacted the Hindi Sahitya Sammelan Act, 1962legislating under entry 63, list I of the Seventh Schedule declaringthat "the institution known as the Hindi Sahitya Sammelan is an institution of national importance". By the Act a statutory sammelan was constituted as a body corporate by the name of the Hindi Sahitya Sammelan. Under section 4(1) of the Act the Sammelan was to consist of the first members of the Society and all persons who might become members thereafter in accordance with the rules made in that behalf by the first Governing Body to be constituted by the Central Government by notification. The Act provided, for vesting in the Sammelan of all property movable or immovable, of or belonging to the society. Petitions under Article 226 in the High Court and under Article 32 in this Court were filed challenging the constitutionality of the Act mainly on the ground that the Act interfered with the right of the petitioners to form association under Article 19(1) (c) of the Constitution. The High Court held that since all the members of the society had also become members of the Sammelan under the Act, there was no infringement of the right to form association. In the appeal and in the petition under Article 32, the respondent contended that having declared the old Hindi Sabitya Sammelan, which was a society registered under the as an institution of national importance, Parliament has proceeded to legislate in respect of it under entry 63 of List I of the Seventh Schedule in order that its administration may not suffer as a result of the quarrels that were going inter be between the members of the society; it was for this purpose that a first Governing Body was constituted to take over the management temporarily; the Act was designed to reconstitute the Sammelan in such a manner that it could worm successfully and without difficulties; and in making provisions for this purpose all members of the old society were included as members of the Sammelan 8 4 1 so that their right to form association may not be taken away from them Alternatively the respondent took up the position that the Act no where specifically laid down that the society shall stand dissolved while it constituted a new Sammelan and therefore, it should be inferred that while the society still continued to exist in its original form the law has brought into existence a new Sammelan to which all the functions and the properties etc. of the society have been passed. Allowing the petition and the appeal. HELD : Under section 12(1) (a) very wide powers are given to the first governing body to make rules in respect of matters relating to membership including qualifications and disqualifications for membership of the Sammelan. Under this power the rules framed could make provisions for admission of persons as members whom the original members of society may never have liked to admit in their Society. The number of such new members could even be so large as to leave the original members in a small minority with the result that those members. could become totally ineffective in the society. Thus the Sammelan which has come into existence, is not identical with the Sammelan which was a registered society under the ., This is clear interference with the right to form a society which has been exercised by the members of the Society by forming the Society with its constitution under which they were members. The Act does not merely regulate the admi nistration of the affairs of the Society; what it does is to alter the composition of the society itself. The result of this change in composition is that the members, who voluntarily formed the society are now compelled to act in that Association with other members who have been imposed as members by the Act and in whose admission to membership they had no say. The right to form association necessarily implies that the persons forming the society have also the right to continue to be associated with only those whom they voluntarily admit in the association. Any law by which members are introduced in the voluntary association without any option being given to the members to keep them out or any law which takes away the membership of those who have voluntarily joined. it will be a law violating the right to form association. [847 H; 849 C E] The right guaranteed by Article 19(1)(c) cannot be confined to the initial stage of forming an association. if it were to be so confined, the right would be meaningless because as soon as an association is formed, a law may be passed interfering with its composition so that the association formed may not be able to function at all. The right can be effective only if it is held to include within, it the right to continue the association with its composition as voluntarily agreed upon by the persons forming the association. And, Article 19(4), on the face of it, cannot be called in aid to claim lidity for the Act. Therefore the provisioncontained in the Act for reconstituting the society into the Sammelan is void. The whole Act becomes ineffective in as much as the formation of the new Sammelan is the very basis for all the other provisions in the Act. [849 F H; 851 E] O.K. Ghosh and Another vs E. X. Joseph, [1963] SUppl. 3 S.C.R. 789; State of Madras vs V. G. Row, ; and V. G. Row vs The State of Madras, A.I.R. 1951 Mad. 147, referred to. The alternative submission cannot be accepted as ensuring the validity of the Act. First, the specific case taken by the respondent has been, that the Actreconstitutes the Society and does not create a separate and independent body in the form of a new Sammelan. Secondly, even if it be acceptedthat a new Sammelan has been constituted, the question of 842 legislative competence of Parliament to pass such a law will arise. The Sammelan is itself a body corporate and that Sammelan has never been declared as an institution of national importance. The only institution that was so declared was the society which, of course, earlier carried the same name as the new Sammelan. Parliament was, therefore, not competent to legislate in respect of this newly constituted Sammelan which at no stage has been declared as an institution of national importance. Thirdly, if it were to be held that Parliament passed this Act so as to transfer all the properties and assets of the Society to the Sammelan, the Act would contravene Article 19(1)(f) of the Constitution. The Sammelan is a new, separate and distinct legal entity from the Society. The Society is thus deprived of all its properties by the Act and such a law depriving the Society of its properties altogether cannot be held to be a reasonable restriction in the public interest on the right of the society to hold the property. The applicability of Article 19(1(f) is on the assumption that the old Society still exists as it was and yet its properties have been transferred to the Sammelan. If the Society still exists, so does its Governing Body in whom the property of the Society vested. The Act thus deprives the members of the Governing Body of the property which still continued to vest in them in spite of the passing of the Act. This total deprivation of property instead of regulating the management of the affairs of the Society of its property cannot clearly be justified as a reasonable restriction in public interest. If the law is passed not merely for ensuring proper management and administration of the property, but for totally depriving the persons, in whom the property vested, of their right to hold the property, the law cannot be justified as reasonable restriction under Article 19(5). [852 B H; 853 E 854 A] The Board of Trustees, Ayurvedic and Unani Tibia College, Delhi vs The State of Delhi & Anr. [1962] Suppl. I S.C.R. 156; referred to.

ON: Criminal Appeals Nos.165 168 of 1962. Appeals by special leave from the judgment and order dated August 25, 1962 of the Patna High Court in Criminal Revisions Nos.527 to 530 of 1962. Nuruddin Ahmad and U. P. Singh, for the appellants. section P. Varma and R. N. Sachthey, for the respondents. The Judgment of the Court was delivered by Mudholkar, J. This judgment will also govern Crl.No. 166 of 1962, 167 of 1962 and 168 of 1962. A common question arises in these appeals from a judgment of the Patna High Court dismissing four revision applications preferred before it by four sets of appellants in the appeals before us. Counsel on both the sides agree that since the relevant facts of all the proceedings are similar and the question of law arising from them is the same it will be sufficient to refer to the facts of Case No. TR 320/60. Four informations were lodged at the police station, Ghora Saha on April 14, 1960 by different persons against the different appellants in these cases and a similar information was lodged against some of the appellants by one Mali Ram. In all these cases the allegations made by the informants were that each set of the accused persons armed with deadly weapons went to the shops of the various informants, demanded from them large sums of money and threatened them with death if they failed to pay the amounts demanded by them. The informations also stated that 742 some of these persons paid part of the money and were given time to pay the balance while some agreed to pay the amounts demanded. Upon informations given by these persons offences under section 392, Indian Penal Code, were registered by the station officer and after investigation five challans were lodged by him, in the court of Magistrate. First Class at Motihari. One of the cases ended in an acquittal but we have not been informed of the date of the judgment in that case. In the other four cases trial had come to a close in that all the prosecution witnesses and the defence witnesses had been examined and the cases had been closed for judgment. In the case against the appellants in Crl. A. 165 of 1962 the challan was presented on October 27, 1960. The order sheet of that date reads as follows: Date of order Order with the Office action section No. or proceeding signature of taken with the Court date 1.27 10 1960 All the 4 accused are present Heard both sides. It is argued on behalf of the prosecution that it is a fit case for adopting procedure under Chapter XVIII Cr. P. C. and also that the entire occurrence relates to offences committed on 4 dates so that all of them cannot be dealt with in a single case. Discussed law point "Charge u/s 302, I.P.C. framed against accused Thakur Ram and Jagarnath Pd. and explained to them. They plead not guilty. This case will constitute an independent case. As for the other parts of the alleged occurrence accused Jagarnath, Kamal Ram and Bansi Rain are charged separately u/s 384, I.P.C. and further accused Thakur Ram u/s 384/109, I.P.C. and explained to the respective accused. They plead not guilty. These charges relating to three incidents on 3 dates will constitute a separate single case. Start separate order sheet for both Summons P.W. for 26 10 60 and 27 11 60.Accused as before. Sd/ O. Nath". The trial dragged on for nearly 15 months and then the prosecution made an application to the court for framing a charge 743 under section 386 or section 387, Indian Penal Code and for committing the case to a court of Sessions. This was disposed of by the learned Magistrate on January 25, 1962. The relevant portion of his order sheet of that date reads thus "Accused absent. A petition for their representation u/s 540 A, Cr P.C. is filed. Allowed. No reference book is produced. Persued the record. The prosecution has pressed to refer the case to the Court of Sessions u/s 386 or 387 I.P.C. On close scrutiny I find that the robbery defined inside 390 I.P.C. fully cover the ingredients pointed out and asked by the prosecution side. The case has entered in the defence stage. This point was not introduced ever before. The charge was framed u/s 392, I.P.C. after hearing the parties. Although it may be referred to the superior court at any stage, I find no reason to do so. Put up on 28 2 62. All accused to appear with D.Ws without fail. Accused as before. " On February 28, 1962 the prosecution moved a petition for stay of proceedings on the ground that it wanted to prefer an application for revision of the order of January 25, 1962. Stay was refused and the case was proceeded with. On March 17, 1962 the defence case was closed and the case was fixed for March 29, 1962 for arguments. On that date a second application was made for committing the case to a court of Sessions. It would appear from the order sheet of March 29, 1962 that the Magistrate heard the parties and ordered the case to be put up on the next day, that is March 30, 1962. On this day the Magistrate passed an order to the following effect "30 3 62 All the 2 accused persons are present. Having carefully gone through the law points and section 236 Cr.P.C. I do not find that it is a case exclusively coming u/s 386 or 387 I.P.C. Hence the prosecution prayer is rejected." Immediately thereafter a revision application was preferred, not by the prosecution, but by Sagarmal, an informant in one of the other three cases. The Sessions Judge, Champaran, after briefly reciting the facts and reasons on which the order of the trying Magistrate was founded, disposed of the revision application in the following words: .lm15 "The cases are of very serious nature and the framing of charges under sections 386 or 387, I.P.C. can 744 not be ruled out altogether. Consequently, I direct that each of these cases should be tried by a Court of Session. The learned Magistrate will commit the accused persons for trial accordingly. The applications are thus allowed. " An application for revision was preferred by the appellants before the High Court and the main ground urged on their behalf was that the Sessions Judge had no jurisdiction to pass an order for commitment as there was no order of discharge by the Magistrate. There is conflict of authority on the question whether under section 437, Cr.P.C. a Sessions Judge can, in the absence of an express order of discharge, direct commitment of a case to it while the trial is proceeding before a Magistrate in respect of offences not exclusively triable by a Court of Sessions. After referring to some decisions and relying upon two decisions of the Allahabad High Court the learned Judge who disposed of the revision application observed as follows "As I have already indicated, in the instant cases, the trial Magistrate, after hearing the parties, refused to frame a charge for the major offence under section 386 or section 387 of the Indian Penal Code. The refusal by the Magistrate to frame a charge under section 386 or 387 of the Indian Penal Code was a final order and it amounted to an order of discharge of the accused of the offence under those sections. That being the position, the learned Sessions Judge had full jurisdiction to order for commitment." The learned Judge further observed "Without expressing any opinion on the merits of the four cases, I would state, that, on the materials on record, the Sessions Judge was not unjustified in passing the impugned order for commitment of the accused in the four cases. The order of the Magistrate refusing to frame a charge under section 386 or section 387 of the Indian Penal Code, which amounted to an order of the implied discharge of the accused, was improper in all the four cases." and dismissed the revision applications. Am application was made for a certificate of fitness to appeal to this Court. That was rejected and the appellants have come here by special leave. 745 The ambit of the powers of the Sessions Judge under section 437, Cr.P.C. has been considered by a Full Bench of the Allahabad High Court in Nahar Singh vs State(1). In that case it was held that the powers conferred by that section are exercisable only in a case where a Magistrate by an express order discharges an accused person in respect of an offence exclusively triable by a court of Sessions. The learned Judges constituting the Full Bench have taken the view that in the light of certain provisions of the Code to which they adverted, the failure of or refusal by a Magistrate to commit an accused person for trial by a court of Sessions does not amount to an implied discharge of the accused person so as to attract the power of the Sessions Judge under section 437, Cr.P.C. to direct the Magistrate to commit the accused person for trial by a court of Sessions on the ground that the offence is exclusively triable by a Court of Sessions. The Full Bench decision has been followed in Sri Dulap Singh & ors.vs State through Sri Harnandan Singh(2). Before us reliance is also placed on behalf of the appellants on the decision in Yunus Shaikh vs The State(3). That decision, however, is of little assistance to them because the ground on which the High Court set aside the order of the Sessions Judge is not that he had no jurisdiction to make it under section 437, Cr.P.C. but that the action of the Magistrate in not framing a charge under section 366 of the Indian Penal Code but framing a charge only under section 498, T.P.C. did not, in the light of the material before him, amount to an improper discharge of the accused in respect of an offence triable by a Court of Sessions. The view taken by the Allahabad High Court has been accepted as correct in Sambhu Charan Mandal vs The State(4 ) . On the other hand a Full Bench of the Madras High Court has held in in re Nalla Baligadu(5) that where under section 209(1) a Magistrate finds that there are not sufficient grounds for committing the accused for trial and directs such person to be tried before himself or some other Magistrate, the revisional powers under section 437, Cr.P.C. can be exercised before the conclusion of the trial before such Magistrate. The learned Judges expressly dissented from the view taken by the Full Bench of the, Allahabad High Court. This decision has been followed in, Rambalam Pd.Singh vs State of Bihar(6). Other decisions which take the same view as the Madras High Court are : Krishnareddi (1) I.L.R. [1952] 2 All. 152.(3) A.I.R. 1953 Cal.(5) A.I.R. 1953 Mad. 801.(2) A.I.R. 1954 All.(4) (6) A.I.R. 1960 Patna 507.746 v.Subbamma(1); Shambhooram vs Emperor(2); Sultan Ali vs Emperor( '); and in re Valluru Narayana Reddy & ors.(4 ) . In order to decide the question which has been raised before us it would be desirable to bear in mind the relevant provisions of the Code of Criminal Procedure. Section 207 provides that in every inquiry before a Magistrate where the case is triable exclusively by a Court of Sessions or High Court, or, which in the opinion of the Magistrate, ought to be tried by such Court, the Magistrate must in any proceeding instituted on a police report, follow the procedure specified in section 207 A. Under section 207 A the Magistrate, after perusing the police report forwarded under section 173, has to fix a date for hearing and require the production of the accused on that date. He has also the power to compel the attendance of such witnesses or the production of any document or thing on that date if an application is made in that behalf by the officer conducting the prosecution. On the date of hearing the Magistrate, after satisfying himself that copies of the documents referred to in section 173 have been furnished, has to proceed to take the evidence, of such persons, if any, as are produced as witnesses to the actual commission of the offence. After the examination of those witnesses and after their cross examination by the accused the Magistrate may, if he thinks it necessary so to do in the interest of justice, take the evidence of any one or more of the other witnesses for the prosecution. He has then to examine the accused for the purpose of enabling him to explain the circumstances appearing in the evidence against him and hear both the proseeution as well as the accused. If at that stage he is of opinion that no round for committing the accused for trial exists, the Magistrate can, after recording his reasons, discharge the accused. If, however, it appears to the Magistrate that such person should be tried by himself or some other Magistrate he must proceed accordingly. This contingency will arise if the Magistrate forms an opinion that no case exclusively triable by a Court of Sessions is disclosed but a less serious offence which it is within the competence of the Magistrate to try is disclosed. In that case he has to proceed to try the accused himself or send him for trial before another Magistrate. Where the Magistrate is of opinion that the accused should be committed for trial he has to frame a charge and declare with what offence the accused should be charged. With the remaining provisions of s, 207 A we are not concerned. It will thus be seen that where the police report suggests the commission of an offence which is exclusively triable by a Court (1) I.L.R. (3) A.I.R. 1934 Lahore 164.(2) A.I.R. 1935 Sind 221.(4) A.I.R. 1955 Andhra 48.747 of Sessions, the Magistrate can nevertheless proceed to try the accused for an offence which is triable by him if he is of the view that no offence exclusively triable by a Court of Sessions is disclosed. Similarly, even in a case where an offence is triable both by a Magistrate and a Court of Sessions, the Magistrate is of the view that the circumstances do not warrant a trial by a Court of Sessions he can proceed with the trial of the accused for that offence himself. Section 347 which occurs in chapter XXIV headed "General provisions as to Inquiries and Trials" empowers a Magistrate to commit a person for trial by a Court of Sessions if in the course of the trial before him and before signing the judgment it appears to him at any stage of the proceeding that the case ought to be so tried. These provisions would thus indicate that an express order of discharge is contemplated only in a case where a Magistrate comes to the conclusion that the act alleged against the accused does not amount to any offence at all and, therefore, no question of trying him either himself or by any other court arises. They also show that where an accused person is being tried before a Magistrate in respect of an offence triable by that Magistrate it appears to the Magistrate that the act of the accused amounts to an offence which is triable either exclusively or concurrently by a Court of Sessions he has the power to order his committal. This power, however, has to be exercised only before signing the judgment. It cannot obviously be exercised thereafter because of the provisions of section 403(1) which bar the trial of the person again not only for the same offence but also for any other offence based on the same facts. It would follow from this that where on a certain state of facts the accused is alleged by the prosecution to have committee an offence exclusively triable by a Court of Sessions but the Magistrate is of the opinion that the offence disclosed is only an offence which he is himself competent to try and either acquits or convicts him there is an end of the matter in so far as the very set of facts are concerned. The facts may disclose really a very grave offence such as, say, one under section 302, I.P.C. but the Magistrate thinks that the offence falls under section 304 A which he can try and after trying the accused either convicts or acquits him. In either case the result would be that the appropriate court will be prevented from trying the accused for the grave offence which those very facts disclose. It is to obviate such a consequence and to prevent inferior courts from clutching at jurisdiction that the provisions of section 437, Cr.P.C. have been enacted. To say that they can be availed of only where an express order of discharge is made by a Magistrate despite the wide language used in section 437 would have 748 the result of rendering those provisions inapplicable to the very class of cases for which they were intended. When a case is brought before a Magistrate in respect of an offence exclusively or appropriately triable by a Court of Sessions what the Magistrate has to be satisfied about is whether the material placed before him makes out an offence which can be tried only by the Court of Sessions or can be appropriately tried by that Court or whether it makes out an offence which he can try or whether it does not make out any offence at all. In Ramgopal Ganpatrai vs State of Bombay(1) this Court has pointed out : "In each case, therefore the Magistrate holding the preliminary inquiry, has to be satisfied that a prima facie case is made out against the accused by the evidence of witnesses entitled to a reasonable degree of credit and unless he is so satisfied, he is not to commit." It has, however, also to be borne in mind that the ultimate duty of weighing the evidence is cast on the court which has the jurisdiction to try an accused person. Thus, where two views are possible about the evidence in a case before the Magistrate, it would not be for him to evaluate the evidence and strike a balance before deciding whether or not to commit the case to a Court of Sessions. If, instead of committing the case to a Court of Sessions, he proceeds to try the accused upon the view that the evidence found acceptable by him only a minor offence is made out for which no commitment is required he would obviously be making an encroachment on the jurisdiction of the appropriate court. This may lead to miscarriage of justice and the only way to prevent it would be by a superior court stepping in and exercising its revisional jurisdiction under section 437 Cr.P.C. There is nothing in the language of section 437 from which it could be said that this power is not exercisable during the pendency of a trial before a Magistrate or that this power can be exercised only where the Magistrate has made an express order of discharge. Express orders of discharge are not required to be passed by the Court in cases where, upon the same facts, it is possible to say that though no offence exclusively or appropriately triable by a Court of Sessions Judge is made out, an offence triable by a Magistrate is nevertheless made out. One of the reasons given by the Allahabad High Court in support of the view taken by it is that a Magistrate has power even during the course of the trial to commit the accused to a Court of Sessions and that to imply a discharge from his omission to commit or refusal to commit (1) [1958] S.C.R.618.749 would not be consistent with the existence of the Magistrate 's power to order commitment at any time. That does not, however, seem to be a good enough ground for coming to this conclusion. The power to commit at any stage is exercisable by virtue of the express provisions of section 347 or section 236 and a previous discharge of an accused from a case triable by a Court of Sessions would not render the power unexercisable thereafter. Moreover, even if an express order of discharge is made by a Magistrate in respect of an offence exclusively triable by a Court of Sessions but a trial on the same facts for a minor offence is proceeded with the Magistrate has undoubtedly power to order his commitment in respect of the very offence regarding which, he has passed an order of discharge provided of course the material before him justifies such a course. There is nothing in section 347 which precludes him from doing this. It will, therefore, be not right to say that the power conferred by section 437 is exercisable only in respect of express orders of discharge. In this context it will be relevant to quote the following passage from the judgment of the Full Bench of the Madras High Court in Krishna Reddy 's case(1) : "I do not think that the order of the Sessions Judge was one which he had no jurisdiction to make. In my view the decision of the Magistrate must be taken to be not only one of acquittal of an offence punishable under section 379, Indian Penal Code, but one of discharge so far as the alleged offence under section 477, Indian Penal Code is concerned. The complaint against the accused was that he committed an offence punishable under section 477, Indian Penal Code. Such offence is triable exclusively by the Court of Sessions. The Magistrate could neither acquit nor convict him of such offence. He was bound either to commit him to the Sessions Court or to discharge him. He did not commit him. The only alternative was to discharge him, and that, I take it, is what the Magistrate really did do. It is not suggested that the charge under section 477 is still pending before the Magistrate. It has been disposed of, and the only question is as to what the disposal has been. It seems to me that the accused has been discharged so far as the charge under section 477 is concerned. The Magistrate 's order, if stated fully,should have been 'I discharge him as regards the offence punishable under section 477, and I acquit him as regards the offence punishable under section 379 (1) L.L.R. 750 We agree and are, therefore, of the view that the High Court was right in holding that the Sessions Judge had jurisdiction to make an order directing the Magistrate to commit the case for trial by a Court of Sessions. The provisions of section 437, however, do not make it obligatory upon a Sessions Judge or a District Magistrate to order commitment in every case where an offence is exclusively triable by a Court of Sessions. The law gives a discretion to the revising authority and that discretion has to be exercised judicially. One of the factors which has to be considered in this case is whether the intervention of the revising authority was sought by the prosecution at an early stage. It would be seen that an attempt to have the case committed failed right in the beginning and was repeated not earlier than 15 months from that date. The second attempt also failed. Instead of filing an application for revision against the order of the Magistrate refusing to pass an order of commitment the prosecution chose to make a second application upon the same facts. It may be that successive applications for such a purpose are not barred but where a later application is based on the same facts as the earlier one the Magistrate would be justified in refusing it. Where the Magistrate has acted in this way the revisional court ought not to with propriety interfere unless there are strong grounds to justify interference. While rejecting the application on January 25, 1962 the ground given by the learned Judge was that the case had already entered the defence stage and the attempt to have the committal was very belated. Matters had advanced still further when a third attempt failed on March 30, 1962. By that date not only had the defence been closed and arguments heard, but the case was actually closed for judgment. It would be a terrible harassment to the appellants now to be called upon to face a fresh trial right from the beginning which would certainly be the result if the Magistrate were to commit the appellants for trial by a Court of Sessions now. It is further noteworthy that after the last attempt failed it was not the prosecution which went up in revision before the Sessions Judge but the informants and, as pointed out earlier, in the matter concerning the appellants before us it was not even the informant Shyam Lall but one Sagarmal, the informant in another case who preferred a revision application. In a case which has proceeded on a police report a private party has really no locus standi. No doubt, the terms of section 435 under which the jurisdiction of the learned Sessions Judge was invoked are very wide and he could even have taken up the matter suo motu. It would, however, not be irrelevant to bear in mind the fact that the court 's 751 jurisdiction was invoked by a private party. The criminal law is not to be used as an instrument of wreaking private vengeance by an aggrieved party against the person who, according to that party, had caused injury to it. Barring a few exceptions, in criminal matters the party who is treated as the aggrieved party is the State which is the custodian of the social interests of the community at large and so it is for the State to take all the steps necessary for bringing the person who has acted against the social interests of the community to book. In our opinion it was injudicious for the learned Sessions Judge to order the commitment of the appellants particularly so without giving any thought to the aspects of the matter to which we have adverted. Even the High Court has come to no positive conclusion about the propriety of the direction made by the Sessions Judge and has merely said that the Sessions Judge was not unjustified in making the order which he made in each of the applications. For all these reasons we allow the appeals, quash the orders of the Sessions Judge as affirmed by the High Court and direct that the trials of each of the appellants shall proceed before the Magistrate according to law from the stages at which they were on the date on which the stay order became operative. Appeals allowed.

The accused were charged under section 392, Indian Penal Code in the Court of a Magistrate. The prosecution failed in its attempt to have the procedure under Ch. XVIII, Code of Criminal Procedure adopted. After 15 months, the prosecution made an application to the Magistrate to frame a charge under section 386 or section 387 Indian Penal Code (which are exclusively triable by a Court of Sessions) and to commit the accused to the Court of Sessions, which was refused. Thereafter a second application was made for committing the case to the Court of Sessions. This, too, was rejected by the Magistrate. Immediately thereafter, one of the informants, filed a revision which the Sessions Judge allowed being of the view that the framing of charges under section 386 or 387, I.P.C. could not be ruled out altogether and directed the Magistrate to commit the accused to the Court of Sessions. The appellants preferred revision to the High Court, contending that the Sessions Judge had no jurisdiction to pass an order for commitment as there was no order of discharge by the Magistrate. The High Court rejected the revision application. In appeal to this Court HELD : There is nothing in the language of section 437 of the Code of Criminal Procedure from which it could be said that this power is not exercisable during the pendency of a trial before a Magistrate or that this power can be exercised only where Magistrate had made an express order of discharge. The provisions of the Code indicate that an express order of discharge is contemplated only in a case where a Magistrate comes to the conclusion that the act alleged against the accused does not amount to any offence at all and, therefore, no question of trying him either himself or by another court arises. Where on a certain set of facts the accused is alleged by the prosecution to have committed an offence exclusively triable by a Court of Sessions but the Magistrate is of the opinion that the offence disclosed is only an offence which he is himself competent to try and either acquits or convicts him there is an end of the matter in so far as the very set of acts are concerned. The facts may disclose really a very grave offence such as, say, one under section 302 I.P.C. but the Magistrate thinks that the offence falls under section 304A which he can try and after trying the accused either convicts or acquits him. In either case the result would be that the appropriate court will be prevented from trying the accused for the grave: offence which those very facts disclose. It is to obviate such a consequence and to prevent inferior courts from clutching at jurisdiction that the provisions of section 437, Criminal Procedure Code have been enacted. G] Nahar Singh vs State, I.L.R. (1952) 2 All. 152, Sri Dulap Singh Ors. vs State through Sri Harnandan Singh A.I.R. 1954 All. 163 and Sambhu Charan Mandal vs the State , disapproved. 741 In re : Nalla Baligadu, A.T.R. , Rambalam Pd. Singh vs State of Bihar, A.I.R. 1960 Patna 507, Krishnareddi vs Subbamma,I.L.R. Shambhooram vs Emperor, A.I.R. 1935 Sind 221,Sultan Al; vs Emperor, A.I.R. 1934 Lahore 164 and In re Valturu Narayan Reddy & Ors. A.I.R. 1955 Andhra 48. , approved. Yunus Shaikh vs The State, A.I.R. 1953 Cal.567 distinguished. The provisions of section 437, however, do not make it obligatory upon a Sessions Judge or a District Magistrate to order commitment in every case where an offence is exclusively triable by a Court of Sessions. The law gives a discretion to the revising authority and that discretion has to be exercised judicially. [750 B] Considering the delay in moving the Sessions Judge, the terrible harassment that the accused would be called upon to face if the Magistrate were to commit them for trial by a Court of Sessions now, and further that it was a private party who had no locus standi that went up in revision before the Sessions judge after the last attempt by the prosecution had failed, it was injudicious for the Sessions Judge to order the commitment of the accused, [150 F H; 751 B C]

ivil Appeal No. 1101 of 1981. On appeal by Certificate from the Judgment and Order dated 8.10.80 of the Kerala High Court in O.P. No. 1026/79E. WITH Writ Petition (Civil) No. 346 of 1988. (Under Article 32 of the Constitution of India). M.K. Ramamurthi, G. Vishwanathan Iyer, Shiv Pujan Singh, N. Sudhakaran and K. Prasantha for the Appellants. Anil Dev Singh, P.S. Poti, Ms. Mukta Sharma, Mrs. section Dikshit, K.R. Nambiar for the Respondents. The Judgment of the Court was delivered by KASLIWAL, J. As identical questions of law are involved in both the above cases, they are disposed of by one single order. Civil Appeal No. 1101 of 1981 is directed against the Judgment of High Court of Kerala at Ernakulam dated October 8, 1980. The High Court has granted a certificate under Article 133(1) of the Constitution of India certifying that the case involved a substantial question of law of general importance consisting the interpretation of Sub section (6) of Section 24 of the Code of Criminal Procedure, 1973. The Writ Petition under Article 32 of the Constitution has been 322 filed by the Uttar Pradesh Public Prosecutors ' Association consisting the membership of Assistant Public Prosecutors, including Prosecuting Officers, Senior Prosecuting Officers, Deputy Director of Prosecution serving under the Government of Uttar Pradesh. Petitioner No. 2 is the President of the Association. In both the cases the controversy raised is that there exists a regular cadre of Prosecuting Officers and as such the State Government is bound to appoint Public Prosecutors and Additional Public Prosecutors only from among the persons constituting such cadre in view of Section 24(6) of the Code of Criminal Procedure, 1973. In order to appreciate the controversy, it would be necessary to give the background of the law and rules relat ing to the appointment of public prosecutors. Sections 24 and 25 of the Code of Criminal Procedure, 1973 correspond to Section 492 of the Old Code and deal with the appointment of Public Prosecutors, Additional Public Prosecutors, Special Public Prosecutors and Assistant Public Prosecutors. Under the Old Code there could be any number of Public Prosecutors appointed by the Central Government or by the State Govern ment or by the District Magistrate or by the Sub Divisional Magistrate subject to the control of the District Magis trate. Under Section 495 of the Old Code any Magistrate enquiring into or trying a case could permit the prosecution to be conducted by any person who may do so personally or by a pleader. In the courts of Magistrates the prosecution was conducted generally by Police Officers or by persons re cruited from the Bard styled as Police Prosecutors or As sistant Public Prosecutors all of whom worked under the directions of the Police Department. Moreover, no qualifica tion was laid down in the old Code for the Advocates being appointed as Public Prosecutors. In Section 24 of the new Code for the first time such detailed provisions have been made. In Section 24 as originally framed there were only two categories of public prosecutor (1) those appointed by the Central or State Government under this Section, and (2) those engaged by the Public Prosecutor to act under his own direction, vide Section 2(U). Provision was also for the first time made for appointment of Public Prosecutor in the High Court for conducting any prosecution in the said court on behalf of the Central Government or the State Government by the concerned Government after consultation with the High Court. The appointment of Public Prosecutor or Additional Public Prosecutor of the State Government in every District could be made only from the panel of names of the persons prepared by the ,District Magistrate in consultation with the Sessions Judge. It was for the first time provided that in the case of Public Prosecutor and the Additional Public Pro 323 secutor he should be an Advocate of not less than seven years standing at the Bar and in the case of Special Public Prosecutor the standing at the Bar should not be less than 10 years. The original Section 24 has been amended by the Criminal Procedure Code (Amendment) Act of 1978 (hereinafter referred to as the Amending Act of 1978) w.e.f. 18th December, 1978 and a new Section 24 has been substituted for the original Section 24. It would be necessary to reproduce Section 24 as it stood in the original Code of Criminal Procedure, 1973 as well as Section 24 which stood after the Criminal Procedure Code (Amendment) Act, 1978. Section 24 of the Code as it stood prior to the amend ment introduced by the Code of Criminal Procedure (Amend ment) Act, 1978, reads as under: "24. Public Prosecutors (1) For every High Court, the Central Government or the State Government shall, after consultation with the High Court, appoint a Public Prosecu tor for conducting, in such court, any prosecution, appeal or other proceeding on behalf of the Central or State Gov ernment, as the case may be. (2) For every district the State Government shall appoint a Public Prosecutor and may also appoint one or more Addition al Public Prosecutors for the district. (3) The District Magistrate shall, in consultation with the Sessions Judge, prepare a panel of names of persons who are, in his opinion, fit to be appointed as the public prosecutor or Additional Public Prosecutor for the District. (4) No person shall be appointed by the State Government as the Public Prosecutor or Additional Public Prosecutor for the district unless his name appears on the panel of names prepared by the District Magistrate under subsection (3). (5) A person shall only be eligible to be appointed as a Public Prosecutor or an Additional Public Prosecutor under sub section (1) or sub section (2), if he has been in practice as an advocate for not less than seven years. 324 (6) The Central Government or the State Government may appoint, for the purposes of any case or class of cases, an advocate who has been in practice for not less than ten years, as a Special Public Prosecutor" The Section as amended by the Amendment Act, 1978 reads as under: "24. Public Prosecutors (1) For every High Court the Cen tral Government or the State Government shall, after consul tation with the High Court, appoint a Public Prosecutor and may also appoint one or more Additional Public Prosecutors, for conducting in such court, any prosecution, appeal or other proceeding on behalf of the Central Government or State Government, as the case may be. (2) The Central Government may appoint one or more Public Prosecutors, for the purpose of conducting any case or class of cases in any district, or local area. (3) For every district, the State Government shall appoint a Public Prosecutor and may also appoint one or more Addition al Public Prosecutors for the district. Provided that the Public Prosecutor or Additional Public Prosecutor appointed for one district may be appointed also to be a Public Prosecutor or an Additional Public Prosecu tor, as the case may be for another district. (4) The District Magistrate shall, in consultation with the Sessions Judge, prepare a panel of names of persons, who are, in his opinion, fit to be appointed as Public Prosecu tors or Additional Public Prosecutors for the district. (5) No person shall be appointed by the State Government as the Public Prosecutor or Additional Public Prosecutor for the district unless his name appears in the panel or names prepared by the District Magistrate under subsection (4). (6) Notwithstanding anything contained sub section (5), where in a State there exists a regular cadre of Prosecuting Officers, the State Government shall appoint a Public Prose cutor or an Additional Public Prosecutor only from 325 among the persons constituting such cadre: Provided that where, in the opinion of the State Government, no suitable person is available in such cadre for such appointment that Government may appoint a person as Public Prosecutor or Additional Public Prosecutor, as the case may be, from the panel of names prepared by the Dis trict Magistrate under sub section (7) A person shall be eligible to be appointed as a Public Prosecutor or an Additional Public Prosecutor under subsec tion (1) or sub section (2) or sub section (3) or subsection (6), only if he has been in practice as an advocate for not less than seven years. (8) The Central Government or the State Government may appoint, for the purposes of any case or class of cases, a person who has been in practice as an advocate for not less than ten years as a Special Public Prosecutor. (9) For the purposes of sub section (7) and sub section (8), the period during which a person has been in practice as a pleader, or has rendered (whether before or after the com mencement of this code) service as a Public prosecutor or as an Additional Public Prosecutor or Assistant Public Prosecu tor or other Prosecuting Officer, by whatever name called, shall be deemed to be the period during which such person has been in practice as an advocate". A perusal of the above provisions would show that the changes that have been introduced in Section 24 by the Amending Act of 1978 are the addition of the new provisions now contained in sub section (2), proviso to sub section (3), sub section (6) and sub section (9). The main contro versy put forward hinges on the new provision now contained in sub section (6) of Section 24. The contention raised on behalf of the petitioners is that sub section (6) of Section 24 introduced by amendment clearly lays down that notwithstand ing anything contained in sub section (5) where in a State there exists a regular cadre of Prosecuting Officers (empha sis added), appointment to the post of Public Prosecutor or Additional Public Prosecutor shall be made by the State Government only from among the persons constituting such cadre. So far as the State of Kerala is concerned, it has been contended 326 on behalf of the appellant that the appointment of Assistant Public Prosecutors was governed by the Statutory Rules framed under Article 309 of the Constitution. These Rules were published on 7th September, 1962 and dealt with the posts of Legal Advisor to the vigilance division. Additional Legal Advisor to the Vigilance division and Assistant Public Prosecutors Grade I & II. As regards Assistant Public Prose cutors Grade I, the appointment was to be made by promotion from Assistant Public Prosecutor Grade II. So far as the Assistant Public Prosecutor Grade II is concerned, the appointment was to be made by direct recruitment. It was pointed out that under the above rules for appointment as Assistant Public Prosecutor Grade II a candidate was re quired to be a member of the Bar having not less than two years active practice in criminal courts. After selection he was to be kept on probation for two years and was also required to undergo a training for a period of six months. It was also pointed out that District was considered as unit for the appointment of Assistant Public Prosecutors Grade II and so far as Assistant Public Prosecutors Grade I are concerned they belonged to the State Cadre. It was thus urged on behalf of the appellant that a regular cadre of Prosecuting Officers in the State of Kerala was existing and in this view of the matter the appointment of a Public Prosecutor or Additional Public Prosecutor could only be made from amongst the persons constituting such cadre as envisaged under sub section (6) of Section 24 of the Crimi nal Procedure Code after amendment. It may be pointed out at this stage that Sh. K.J. John, Assistant Public Prosecutor Grade I filed a writ petition in the High Court of Kerala and a Division Bench by Judgment dated 5th October, 1980 dismissed the writ petition. The High Court considered the meaning and scope of the expres sion "regular cadre of Prosecuting Officers" occuring in sub section (6) of Section 24 of the Code. According to the High Court sub section (9) of Section 24 provided a clue to the intention of the Parliament in using the said expres sion. It held that from sub section (9) it would be clear that the expression "Prosecuting Officers" has been used in sub section (6) as meaning any persons holding the post of Public Prosecutor, Additional Public Prosecutor, Assistant Public Prosecutor or any other Prosecuting Officer by what ever name called. Thus in the opinion of the High Court, sub section (6) contemplated a prerequisite condition for its applicability the existence of a regular cadre consist ing of officers holding all the aforementioned posts with a regular framework of service consisting of a hierarchy of such officers. The provisions of sub section (6) of Section 24 can, therefore, have application in respect of States where there is a 327 regular cadre consisting of a hierarchy of Prosecuting Officers with the Assistant Public Prosecutor at the lowest rung and having at the top level Additional Prosecutors and Prosecutors. According to the High Court admittedly no such cadre of such officers existed in the State of Kerala and as such there was no question of applying the provisions of sub section (6) of Section 24. It may also be pointed out that the High Court also noticed the provisions of Kerala Government Law Officers (Appointment and Conditions of Service) and Conduct of Cases Rules, 1978 which dealt with the method of appointment of Government Law Officers at District Court level and the duration of their appointment. These Rules specifically laid down that Government Law Officers at District Court Centres, Additional District Court Centres, inclusive of Public Prosecutors and Additional Public Prosecutors were to be appointed by the Government from a panel of advocates fur nished by the District Collector who was to prepare such panel in consultation with the District and Sessions Judge. The appointment of a person as Public Prosecutor or Addi tional Public Prosecutor shall only be for a term of three years. The High Court considered that the posts of Public Prosecutors and Additional Public Prosecutors under the above Rules were tenure posts and as such the Assistant Public Prosecutors who were regular hands cannot be appoint ed to the tenure posts. The High Court ultimately, held that there was no regular cadre of Prosecuting Officers in the State of Kerala comprising therein Public Prosecutors and Additional Public Prosecutors. Learned counsel appearing on behalf of the appellant K.J. John in Civil Appeal No. 1101 of 1981 contended that under the Old Code the qualification and method of appoint ment for Public Prosecutors did not require any condition for a candidate to be an advocate. In order to remove such unsatisfactory state of affairs the Legislature provided the qualification and the method of appointment of Public Prose cutors and Additional Public Prosecutors by making elaborate provisions in Section 24 of the Criminal Procedure Code, 1973. Under Section 24, as it stood before the 1978 amend ment, provision was made for appointment of Public Prosecu tors and Additional Public Prosecutors from a panel of names of advocates to be submitted by the District Magistrate inconsultation with the Sessions Judge to the State Govern ment. A provision was made for the first time that a period Of seven years of practice at the Bar was necessary for appointment of Public Prosecutors and Additional Public Prosecutors. 328 It was further contended that this scheme of appointment of Public Prosecutors and Additional public Prosecutors was again found to be unsatisfactory because the selection of persons for for appointment as Public Prosecutors from the Bar was not found to be satisfactory. Further the Assistant Public Prosecutors with required experience and ability and who were amenable to the disciplinary jurisdiction of the Government and had no avenues of promotion, were denied promotion as Public Prosecutors. The Legislature wanted to rectify this defect and, therefore, amended Section 24 suitably to promote Assistant Public Prosecutors as Public Prosecutors and Additional Public Prosecutors at the Dis trict level. The amendment in Section 24 by Amending Act of 1978 was thus made with the above purpose and intention. It was thus contended that under sub section (6) of Section 24 introduced by the amendment, it was never intended to in clude the posts of Public Prosecutors and Additional Public Prosecutors within the expression "exists regular cadre of Prosecuting Officers". It was urged that the regular cadre of Prosecuting Officers as mentioned in sub section (6) of Section 24 is dehors the cadre of Public Prosecutors/ Addi tional Public Prosecutors otherwise sub section (6) becomes meaningless. It was thus submitted that the High Court com mitted an error in construing the expression "regular cadre of Prosecuting Officers" to comprise a service with Assist ant Public Prosecutor at the lowest level and Public Prose cutor at the top. If Public Prosecutors and Additional Public Prosecutors are necessary in the existing cadre as interpreted by the High Court then there was no question of granting any benefit by the Legislature by introducing sub section (6) in Section 24 by way of amendment. It was next contended that the High Court misunderstood the scope of sub section (9). A combined reading of sub sections (6), (7) & (9) is necessary to understand the intention of the Legislature. According to the learned counsel sub sec tion (6) provided for appointment of Public Prosecutors from a regular cadre of Prosecuting Officers, subsection (7) provided that a person to be eligible for appointment as Public Prosecutor must have been in ' practice as an advocate for not less than seven years and therefore sub section (9) was necessary to create the fiction that the period of service as a Public Prosecutor or as an Additional Public Prosecutor or Assistant Public Prosecutor or other Prosecut ing Officer, by whatever name called, shall be deemed to be the period during which such person has been in practice as an advocate. As regards the reason given by the High Court that the post of ' Public Prosecutor and Additional Public Prosecutor were tenure post.s for three years, it was sub mitted by learned counsel for appellant 329 that the Kerala Government Law Officers (Appointment and Conditions of Service) and Conduct of Cases Rules, 1978 as notified in the Kerala Gazette No. 25 dated 20th June, 1978 was made before the coming into force of the Criminal Proce dure Code (Amendment) Act, 1978 on December 18, 1978. It was thus contended that the above Kerala Rules making the posts of Public Prosecutors and Additional Public Prosecutors as tenure posts cannot stand in the face of Section 24 of Criminal Procedure Code after Amendment Act of 1978. In the alternative it was also contended that even if the posts of Public Prosecutors and Additional Public Prosecutors in Kerala may be allowed to continue as tenure posts, there is no bar for appointment of Assistant Public Prosecutors on such posts. The Assistant Public Prosecutors will be in the same position as officers on deputation and will come back to their parent posts after the period of such tenure posts is over. It is contended that this cannot be considered as a circumstance or a ground to construe sub section (6) of Section 24 to mean that the expression "regular cadre of Prosecuting Officers" does not enable the Assistant Public Prosecutors to claim appointment as Public Prosecutor. Learned counsel appearing on behalf of the petitioners in the Writ Petition have also made identical arguments as made in the Kerala case. The State of U.P. in its counter affidavit has pointed out that the cadre of Prosecuting Officers working in lower district courts in criminal side is wholly different and it cannot include Public Prosecutors who work exclusively on contract basis in the Sessions Courts. Assistant Prosecuting Officers are appointed under Section 25 of the Code of Criminal Procedure. After 1980, the Assistant Prosecuting Officers have been appointed by the State Government through the Public Service Commission, on the basis of competitive written examination and inter view of Law Graduates. On the other hand Public Prosecutors are appointed in terms of professional contracts under Section 24(4) and 24(5) of the Code of Criminal Procedure. A panel of names of advocates with seven years working experi ence is prepared by the District Magistrate in consultation with the District & Sessions Judge and sent to Law Depart ment of the State Government for approval. Public Prosecu tors are thus appointed by the Law Department of State Government, whereas Assistant Prosecuting Officers are appointed by the Home Department of the State Government as regular Government servants. It has been further submitted in the reply that Assistant Prosecuting Officers are regular Government servants and they get monthly salary and other allowances as admissible to other regular Government serv ants. The services of Assistant Prosecuting Officers are pensionable, while Public Prosecutors are 330 appointed purely on the basis of contract, on a fixed fees. Assistant Public Prosecuting Officers work under the admin istrative control of Home Department and Director General (Prosecution) is Head of the Prosecution Department. The work and performance Of Public Prosecutors is assessed by the District Magistrate at the District level and they are controlled by the Law Department of the State Government. It has been further submitted in the reply that the Assistant Prosecuting Officers main work is to prosecutre criminal cases in the lower District Courts i.e. courts of Judicial Magistrates, Chief Judicial Magistrate, Metropolitan Magis trates, Chief Metropolitan Magistrates, Munsif Magistrates, Executive Magistrates, District Magistrates and special Courts under the Terrorist Act and the Gangster Act. The Assistant Prosecuting Officers also help the Executive Magistrate to conduct the identification of accused in criminal cases and also report on bail applications of the accused. Assistant Prosecuting Officers also check the records of Sessions cases before their committal to Sessions Court and they also deal with the finger print branch and Malkhana of case properties. They are Legal Advisors of the Superintendents of Police in matters pertaining to investi gation. The Public Prosecutor 's main work is to prosecute the criminal cases in the Sessions Courts. The State Government in its counter affidavit has fur ther given the following chart showing the hierarchy pay scales and strength of cadre: Name of Post Pay scale Permanent Temporary. Total No. of Posts Joint Director Rs. 1840 2400 1 1 Legal Joint Director Rs. 1840 2400 1 1 (Admn.) Dy. Director Rs. 1250 2050 5 6 11 Sr. Prosecuting Rs. 1250 2050 17 17 Officer (Gr. I) Sr. Prosecuting Rs. 850.1720 13 70 83 Officer (Gr. II) Prosecuting Rs. 770 1600 84 114 198 Officer 331 Asstt. Prosecuting Rs. 625 1240 704 174 878 Officer As against the aforesaid cadre and pay scales the Public Prosecutors are retained on monthly fees/daily fees as the case may be. They are paid library allowances also. The rates in their cases have been indicated as under: Monthly Library Fees Allowance (1) Public Prosecutor/District Rs.2700 Rs.300 Govt. Counsel (Gr.) (2) Additional Public Prosecutor Rs.2550 Rs.250 Gr. I/Addl. District Govt. Counsel (Gr.) (3) Addl. Public Prosecutor Rs. 1800 Rs.200 Gr. II/Asstt. Distt. Counsel (Gr.) (4) Addl. Public Prosecutor Rs. 50 as daily fees. III It has been further submitted in the reply that the petitioners have several promotional avenues in their own cadre and cannot claim any post outside their cadre. In Uttar Pradesh there is no regular cadre of Prosecuting Officers within the meaning of Section 24(6) of the Code of Criminal Procedure and as such the petitioners are not entitled to appointment as Public Prosecutors or Additional Public Prosecutors in Sessions Courts. It has also been pointed out that at present the total strength and posts of Assistant Prosecuting Officers is 878 out of which 66 1 have been filled and the rest are vacant. The total number of posts of Prosecuting Officers is 198 out of which 191 have been filled up and the rest are vacant. At present the posts of Senior Prosecuting Officer Gr. II & I are 83 and 17 respectively. Thus there is ample opportunity of promotion open to the petitioners. The main controversy hinges on the scope of sub section (6) of Section 24 and specially the words "regular cadre of Prosecuting Officers" existing in this provision. Prior to coming into force of the Code of Criminal Procedure, 1973, the Prosecuting Officers were under the 332 control of Police Department. It was not necessary at that time that the Public Prosecutor or Additional Public Prose cutor should have any experience as an advocate. In order to remove such unsatisfactory state of affairs, the Legislature made an elaborate provision under Section 24 for the ap pointment of Public Prosecutors and Additional Public Prose cutors in the Criminal Procedure Code, 1973. Under this provision it was laid down that practice as an advocate for not less than seven years was necessary for appointment of Public Prosecutor and Additional Public Prosecutor. After sometime, it was considered by the Legislature that the above provision does not take into consideration the working experience of Prosecuting Officers and pleaders for eligi bility for appointment as Public Prosecutor and Additional Public Prosecutor. The Legislature as such substituted a new Section 24 by the Criminal Procedure Code (Amendment) Act, 1978 brought into force w.e.f. 18th December, 1978. Under sub section (9) of this new Section 24 it was provided that the period during which a person has been in practice as a pleader, or has rendered service as a Public Prosecutor or as an Additional Public Prosecutor or Assistant Public Prosecutor or other Prosecuting Officer, by whatever name called, shall be deemed to be the period during which such person has been in practice as an advocate. This provision thus granted benefit of the period of service to the persons mentioned in the above provision and by a deeming fiction such period of service was considered as the period in practice as an advocate. Thus the above provision made the Prosecuting Officers such as Public Prosecutor, Additional Public Prosecutor, Assistant Public Prosecutor or other Prosecuting Officer, by whatever name called, also eligible for being included in the panel to be prepared by the Dis trict Magistrate in consultation with the Sessions Judge fit to be appointed as Public Prosecutors or Additional Public Prosecutors for the district. In this background we have to understand the scope of subsection (6) of Section 24 which gives a clear mandate to appoint a Public Prosecutor or an Additional Public Prosecu tor only from amongst the persons constituting a regular cadre of Prosecuting Officers. According to this provision any person from the advocates or from any other source cannot be appointed as a Public Prosecutor or an Additional Public Prosecutor if there already exists a regular cadre of Prosecuting Officers in a State. So far as the proviso to sub section (6) of Section 24 is concerned it would not apply in the normal circumstances and would only be attract ed where in the opinion of the State Government no suitable person is available in such regular cadre of Prosecuting Officers for appointment as Public Prosecutor or Addi 333 tional Public Prosecutor. Admittedly the regular cadre of Prosecuting Officers in the State of Kerala as well as in the State of U .P. does not include Public Prosecutors or Additional Public Prosecutors. The case of the appellants is that Assistant Public Prosecutors Gr. I and Gr. II together constitute a cadre of Prosecuting Officers so as to attract the applicability of sub section (6) of Section 24 of the Code. It has been contended on their behalf that unless the Government formed the requisite opinion that no suitable person is available in the said cadre for appointment as Public Prosecutor or Additional Public Prosecutor, the appointments to the posts of Public Prosecutor, and Addi tional Public Prosecutor can be made only from amongst persons holding the posts of Assistant Public Prosecutors Gr. I & Gr. A combined reading of sub section (6) and sub section (9) of Section 24 gives a clue to the intention of the Legislature in determining the scope of the expression "regular cadre of Prosecuting Officers" occurring in sub section (6). The intention of introducing sub section (6) and the deeming fiction in sub section (9) was in order to safeguard the promotional rights of Prosecuting Officers in such of the States where there is already in existence regular cadre consisting of a hierarchy of Prosecuting Officers going to the top level of Additional Public Prose cutors and Public Prosecutors. In Sub sectiOn (9) the ex pression "Prosecuting Officers" has been used as taking in any persons holding the post of Public Prosecutor, Assistant Public Prosecutor or any other Prosecuting Officer by what ever name called. Sub section (6) independently can grant no benefit to the Prosecuting Officers unless the clause of deeming fiction contained in sub section (9) makes them eligible for appointment1 as a Public Prosecutor or Addi tional Public Prosecutor. Sub section (9) clearly speaks with regard to the service rendered as a Public Prosecutor or as Additional Public Prosecutor, or Assistant Public Prosecutor or other Prosecuting Officer, by whatever name called to be counted as the period as if such person had been in practice as an advocate for the purposes of subsec tion (7) & sub section (8). Thus we are clearly of the view that the expression "regular cadre of Prosecuting Officers" contained in subsection (6) of Section 24 must comprise a regular cadre of Prosecuting Officers going up to the level of Additional Public Prosecutor and Public Prosecutor. It may be important to note that so far as the State of Kerala is concerned under Rule (5) of the Kerala Government Law Officer (Appointment & Conditions of Service) and Conduct of Cases Rules, 1978, it has been stated that the Legal Advisor to the Vigilance Department, Additional Legal Advisor to the Vigilance Department and Assistant Public Prosecutor Gr. I shall belong to the State Cadre 334 in the sense that for the purpose of appointment, probation, seniority, discharge of probationers and approved probation ers for want of vacancy, the State shall be the unit whereas in the case of Assistant Public Prosecutor Gr. II, the District concerned shall be the unit for all such purposes. Thus if we take the argument of learned counsel for the appellant to its logical conclusion, the result would be that in a State if there existed a cadre of Prosecuting Inspectors or Assistant Public Prosecutors only in that case also the State Government would be bound to appoint Public Prosecutor and Additional Public Prosecutor only from among such cadre under sub section (6) of Section 24. It could not have been the intention of the legislature while enacting sub section (6) of Section 24 of the Code. It was also contended on behalf of the petitioners that in case the meaning to the expression "regular cadre of Prosecuting Officers" under sub section (6) of Section 24 is given as to consist of a regular cadre of Prosecuting Officers going upto Public Prosecutor at the top, then there is no benefit to such persons by enacting sub section (6) and (9) in Section 24 of the Code. We find no force in this contention. The basic intention of the Legislature was to appoint Public Prosecutors and Additional Public Prosecutors from the advocates having atleast seven years practice. Section 24 as initially contained in Section 24 of the Code did not make any Prosecuting Officer even of the cadre of Public Prosecu tor prior to 1973 as eligible for being appointed as Public Prosecutor or Additional Public Prosecutors, they were made eligible by substituting Sec. 24 by the Amending Act of 1978 by introducing a new provision under subsection (9) of Section 24. In this background when we consider the provi sion of sub section (6) of Section 24 which makes it incum bent to appoint Public Prosecutor and Additional Public Prosecutors only from a regular cadre of Prosecuting Offi cers, it can only be applied in case of such regular cadre which may go upto the level of Public Prosecutor. In view of these circumstances we find that the Kerala High Court is right in taking the view that the expression "regular cadre of Prosecuting Officers" comprised a service with Assistant Public Prosecutor at the lowest level and Public Prosecutors at the top. In case a regular cadre of Prosecuting Officers did not go into Public Prosecutor at the top, the State Government cannot be considered as bound to appoint Public Prosecutor or Additional Public Prosecutor only from among the persons constituting such cadre under the. Code of Criminal Procedure for conducting cases in the Sessions Court. There is another insurmountable difficulty which exists in the 335 way of the appellant and the petitioners in as much as the State Government has made the posts of Public Prosecutor and Additional Public Prosecutors as tenure posts It lies within the competence of the State Government to keep such posts of Public Prosecutor and Additional Public Prosecutor as tenure posts for some period based on contract and not to make such posts as regular or permanent under any service rule. In this view of the matter till such posts are tenure posts, to be filled on contract basis for some period, the Assistant Public Prosecutors who are members of a regular service cannot claim any right to be appointed on such posts under sub section (6) of Section 24 of the Code of Criminal Procedure. They are also eligible to be considered with any advocate of seven years standing if willing to join such post on tenure basis by the District Magistrate in consulta tion with the Sessions Judge. We cannot accept the conten tion of the learned counsel for the petitioners in this regard that Assistant Public Prosecutors can be appointed on such tenure posts on deputation and may return back to their parent service after completion of the period of such tenure posts. The State of U.P. in its counter has clearly brought out the distinction in these two kinds of posts in the manner and terms of their appointment, discharge of duties, emoluments etc. The Assistant Public Prosecutors have ave nues of promotion in their own cadre and no argument can however be advanced in interpreting the provision of sub section (6) of Section 24 on this basis. In the result both the above cases are dismissed with no order as to costs. R.S.S. Appeal and Petition dismissed.

The appellant in the civil appeal was an Assistant Public Prosecutor Grade I in the State of Kerala. The writ petition under Article 32 of the Constitution has been filed by the Uttar Pradesh Public Prosecutors ' Association con sisting of the membership of Assistant Public Prosecuters, including Prosecuting Officers, senior Prosecuting Officers, Deputy Director of Prosecution serving under the Government of Uttar Pradesh. In both the cases the controversy raised is that there exists a regular cadre of Prosecuting Officers and as such the State Government is bound to appoint Public Prosecutors and Additional Public Prosecutors only from among the persons constituting such cadre in view of section 24(6) of the Code of Criminal Procedure, 1973, as amended by the Criminal Procedure Code (Amendment) Act of 1978. The appellant 's writ petition filed in the High Court of Kerala was dismissed. The High Court was of the view that the provisions of sub section (6) of section 24 could have application in respect of States where there was a regular cadre consisting of hierarchy of Prosecuting Officers with the Assistant Public Prosecutor at he lowest rung and having at the top level Additional Public Prosecutors and Public Prosecutors. The High Court held that there was no regular cadre of Prosecuting Officers in the State of Kerala Com prising therein Public Prosecutors and Additional Public Prosecutors. The High Court further observed that under the Kerala Government Law Officers (Appointment and Conditions of Service) and Conduct of Cases Rules, 1978 the posts of Public Prosecutors and Additional Public Prosecutors were tenure posts and as such the Assistant Public Prosecutors who were regular hands could not be appointed to the tenure posts. 320 Before this Court it was contended on behalf of the appellant/ petitioners that Assistant Public Prosecutors Grade I and Grade II together constituted a cadre of Prose cuting Officers so as to attract the applicability of sub section (6) of section 24 of the Code. It was urged that in case the meaning to the expression "regular cadre of Prose cuting Officers" under sub section (6) of section 24 was given as to consist of a regular cadre of Prosecuting Offi cers going upto Public Prosecutor at the top, then there was no benefit to such persons by enacting sub sections (6) and (9) in section 24, by the Amending Act of 1978. It was further urged that there was no bar for appointment of Assistant Public Prosecutors against tenure posts as offi cers on deputation. The State of U.P. in its counter has brought out the distinction in these two kinds of posts in the manner and terms of their appointment, discharge of duties, emoluments etc. It was further urged that in Uttar Pradesh there was no regular cadre of Prosecuting Officers within the meaning of section 24(6) of the Code of Criminal Procedure and as such the petitioners were not entitled to appointment as Public Prosecutors or Additional Public Prosecutors. Dismissing the appeal and the writ petition, this Court, HELD: (1) The intention of introducing sub section (6) and the deeming fiction in sub section (9) was in order to safeguard the promotional rights of Prosecuting Officers in such of the States where there was already in existence a regular cadre consisting of a hierarchy of Prosecuting Officers going to the top level of Additional Public Prose cutors and Public Prosecutors. [334E F] (2) The Kerala High Court was right in taking the view that the expression "regular cadre of Prosecuting Officers" comprised a service with Assistant Public Prosecutor at the lowest level and Public Prosecutors at the top. In case a regular cadre of Prosecuting Officers did not go upto Public Prosecutor at the top, the State Government could not be considered as bound to appoint Public Prosecutor or Addi tional Public Prosecutor only from among the persons consti tuting such cadre under the Code of Criminal Procedure for conducting cases in the Sessions Court. [334G H] (3) It was within the competence of the State Government to keep such posts of Public Prosecutor and Additional Public Prosecutor as tenure posts for some period based on contract and not to make such 321 posts as regular or permanent under any service rule. In this view of the matter, till such posts were tenure posts, to be filled on contract basis for some period, the Assist ant Public Prosecutors who were members of a regular service could not claim any right to be appointed on such posts under sub section (6) of section 24 of the Code of Criminal Procedure. [33SA C] (4) The contention of the petitioners that Assistant Public Prosecutors can be appointed on such tenure posts on deputation and may return back to their parent service after completion of the period of such tenure posts, was not acceptable. [335C]

Appeal No. 401 of 1957. Appeal from the judgment and decree dated June 15, 1954 of the Assam High Court in First Appeal No. 23 of 1950. D. N. Mukherjee, for the Appellants. B. Sen, P. K. Chatterjee and P. K. Bose, for the Respondent. 1961, May 5. DAS GUPTA, J. This appeal is from the judgment and decree of the High Court of Judicature in Assam affirming the judgment and decree made by the Subordinate Judge of Upper Assam Districts, in a suit brought by the respondent Shyamsundar Tea Co., Ltd., against the present appellants. The 804 appellant companies are joint owners of Steamer service between Dibrugrah and Calcutta. The main service is along the Brahmputra River. Desang is one of the tributaries of the Brahmputra and meets the main stream at Desangmukh Ghat. The plaintiff 's case in the plaint was that the defendant companies as common carriers received goods at Dillibari Ghat which is situated on the Desang about 70 miles up stream from Desangmukh Ghat for carriage "therefrom by boats to Desangmukh Ghat and then by their steamers to different stations on payment of freight". It is further the plaintiff case that on September 10, 1946, the plaintiff company delivered 120 chests of tea to the defendants at Dillibari Ghat for carrying therefrom and delivery of the same at Kidderpore in Calcutta. The boat carrying these. tea chests sank; the tea chests were lost and could not be salvaged. The accident was, according to the plaintiff, due to the negligence on the part of the defendant companies ' agents and servants. On this ground of negligence as also on the ground that the companies as common carriers were liable to make good the loss whether or not there was negligence, the plaintiff claimed the sum of Rs. 1,6,224 12 0 is compensation for the loss. The defendants raised a four fold defence. The first contention was that there was no delivery to the defendants at all at Dillibari Ghat and the defendants did not undertake any carriage of the goods from Dillibari Ghat. Secondly, it was said that the sinking of the boat was not due, to any negligence on the part of the defendants ' servants. The third contention that the defendants were not a common carrier in respect of carriage of goods from Dillibari Ghat to Desang. Lastly it was pleaded that in any case the conditions of the Forwarding Note which was executed by the plaintiff company completely absolved the defendants from all liability. 805 The trial Court held on a consideration of the evidence that the goods were delivered by the plaintiff to the defendants at Dillibari Ghat for carriage from there to Kidderpore, Calcutta. It also held that the sinking of the boat was due to negligence on the part of the defendants ' servants. Accordingly, without coming to a clear conclusion whether the defendants were common carriers or not in respect of this contract of carriage the Trial Court gave the plaintiff a decree for the sum as claimed. On appeal the High Court of Assam affirmed this decree, though not for quite the same reasons. The High Court agreed with the Trial Courts ' conclusion. that there was delivery of the goods to the defendants by the plaintiff at Dillibari Ghat for carriage therefrom. On the question whether the sinking of the boat was due to the negligence of the defendants ' servants the learned Judges of the High Court did not however accept the Trial Court 's view. Their opinion, it appears, was that the plaintiff had not been able to establish the case of negligence on the part of the defendant 's servants. The High Court however came to the conclusion that the defendants undertook this carriage from Dillibari Ghat in their capacity as common carriers and so the question whether there ,was negligence or not was irrelevant. The High Court also found that the terms and conditions of the Forwarding Note did not in any way absolve the defendants from liability. Accordingly, the High Court affirmed the decree made by the Trial Court. It may be mentioned that though on both the points, viz., whether the delivery of the goods at Dillibari was to the defendants and whether the defendants were, for such carrying from Dillibari, common carrier, one of the learned judges, Ram Labhaya J. appears to have, been hesitant in coming to his conclusion but ultimately on both these points he agreed with the Chief Justice and 806 the agreed conclusions of both the learned judges were, as we have mentioned above. The High Court gave a certificate under article 133(1)(c) of the Constitution and on that certificate the present appeal has been brought. On behalf of the appellants Mr. Mukherjee has J. tried to persuade us to examine the findings of the Courts below that the plaintiff delivered the tea chests in question to the defendants at, Dillibari Ghat. He tried to show that it was Meeneill and Company who used to run this boat service from Dillibari to Desangmukh and that the defendants had nothing to do with this business. Apart from the fact that such a case that Macneill and Company used to carry on an independent boat service business to Desangmukh was not made in the plaint, we are satisfied that there is nothing that would justify us to depart from the well established practice of this Court not to interfere with eoncurrent findings of facts, of the Trial Court and the first court of appeal. We may however indicate that having been taken through the evidence we have no hesitation in stating our agreement with that finding, ' viz., that the plaintiff delivered the tea chests in question to the defendants at Dillibari Ghat for carriage therefrom. We see no reason also to interfere with the High Court 's findings that the plaintiff has not been able to establish its case of any negligence on the part of the defendants ' agents. This brings us to the main question in controversy, viz., whether the appellants were common carriers of goods between Dillibari Ghat and Calcutta. The appellants admit that they are common carriers between Desangmukh Station and all other places on its steamer routes. They contend however that that does not make them common carrier between Dillibari Ghat or other 'places not in its steamer service route, to any places on the steamer service route. 'The respondent ' secase, on the other 807 hand is that once it is established that the defendants are common carriers within the meaning of the definition in the Carriers Act, they must be held in law to be common carriers whenever they undertake carriage of goods, unless with respect to the particular carriage they show definitely that they did not act as common carriers. The Carriers Act, 1865 (Act III of 1.865) defines "common carrier" in these words " 'Common carrier ' denotes a person, other than the Government, engaged in the business or transporting for hire property from place to place, by land or inland navigation, for all persons indiscriminately." This definition is based on the English common law as regards the common carriers. The common law in England developed from quite early times to make the profession of common carriers a kind of public service ; or as stated by Lord Holt in an early case "a public trust". (Vide Lane vs Cotton) (1). It is where such a public trust has been undertaken as distinct from t mere private. contract that a carrier ceases to be a private carrier but becomes a public carrier or as English law calls "a common carrier. " Explaining the distinction between a mere carrier and a common carrier, Alderson B, said in Ingate and Another vs Christis(2) "Everybody who undertakes to carry for anyone who asks him, is a common carrier. The criterion is, whether he carries for parti cular persons only, or whether he carries for everyone. If a man holds himself out to do it for everyone who asks him, he is a common carrier ; but if he does not do it for everyone, but carries for you and me only, that is a matter of special contract." (1) (2) ; The question in any particular case whether the carrier was a common carrier or a private carrier has therefore to be decided on the ascertainment of what he publicly professes. This profession, it need hardly be mentioned may be by public notice or by actual indiscriminate carrying of goods. It is also clear that the profession to carry goods indis criminately may be limited to particular goods or to particular routes or even is to two or more specified points. In Johnson vs Midland Rly., Co.(3) the question arose whether the Railway Company were as common carriers bound to carry coal from Melton Mowbray to Oakham, Parke B, with whom Alderson B, Rolfe, B, and Platt B, agreed stated the law thus: "A person may profess to carry a particular description of goods only, for instance, cattle or dry goods, in which case he could not be compelled to carry any other kind of goods; or he may limit his obligation to carrying from one place to another, as from Manchester to London, and then he would not be bound to carry to or from intermediate places. " Turning to the facts of the case before him the learned Baron stated: "Now, if the defendants stand in the situation of carriers at common law, they are not liable, because it does not appear in evidence that they ever had been a public profession by them that they would carry coals from Melton Mowbray to Oakham." Ultimately the learned Judge recorded the conclusion thus: "I think that the circumstances of their having undertaken to be carriers does not (3) ; , 809 bind them to carry from or to each place on the line, or every description of goods. " This is goods authority for the appellants ' contention that the more fact that they are engaged in the transport of goods from certain places on their Steamer Service to other places does not necessarily justify the conclusion that whatever carriage they may undertake elsewhere is also done as a common carrier. It is therefore necessary to examine the nature of the public profession made by the appellants with regard to the carriage of goods from Dillibari Ghat. It is true, as pointed out by the appellants ' counsel that there is no public notice, as there is in respect of places on the Steamer Service route, with regard to carriage from Dillibari Ghat. It is legitimate however to consider in this connection the usual conduct of the appellant companies in connection with carriage from Dillibari Ghat and other surrounding circumstances. It has to be noticed that tea gardens which supply the bulk of the companies ' cargo traffic for its despatch steamers find it convenient and economical to bring, their goods to the nearest point on some river and to enter into contracts of carriage of goods from these points to places on the Steamer Service routes. It appears clear from the evidence adduced in this case that for such carriage the tea gardens make requests to the appellants to arrange for carriage to the Steamer station and the companies invariably comply with such requests. Their own witness, the Joint Agent at Dibrugarh, has said in this connection "We always try to give facilities to the interior tea gardens and to all customers whenever they require any help. " He has not said a single word as to requests" of any customers for arrangements of carriage from Dillibari Ghat having been refused. Indeed, when one remembers that it is by getting the custom from these interior tea gardens, not all of which are situated 'on or , near the main stream of the 810 Brahmputra that the companies are able to get sufficient cargo for their steamers, it was only natural that they would accept goods for carriage from places away from the main stream as indiscriminately as they do for carriage from stations on the main steamer route. The defendants ' witness Mohammad Abdulla who is their Ghat Supervisor at Desangmukh has stated that "the Steamer Company bears expenses of the clearance of the rivers to make them navigable. " Such conduct is consistent only with the case that the companies are anxious to receive whatever cargo they get for carriage from places on the river Desang and other tributaries to stations on the main steamer route for further carriage on the steamer route. The service on these tributaries can therefore be reasonably described as a "feeder service" for the main route and the admitted public profession for indiscriminate carriage of the goods of every person on the main route cannot but attach to the service on these "feeder routes" also. Against all this, Mr. Mukherjee pressed for our consideration three circumstances: (i) that the rate for carriage from Dillibari was not a fixed rate; (ii) that there was no regular service but boats were supplied only on requisition; and (iii) that the carriage was made without profit. Nothing turns on the third fact assuming that it has been established that carriage from Dillibari to Desangmukh is made without profit. If this is actually the case it is obvious that the defendants deliberately do this as a part of their business so as to attract good business on the main steamer service route where they hope to make sufficient profits to make up for the loss in feeder service. The circumstance that there was no regular 811 service but boats were supplied only on requisition is also wholly irrelevant for ascertaining whether there was a public profession to carry indiscriminately. Even if there was a regular service, there might not be a profession to carry indiscriminately ; whereas even if there was such a profession it would not necessarily happen that regular service should be maintained. If, as the evidence appears to establish, the companies were ready to supply boats whenever requested, without picking and choosing, that would be sufficient public profession to act as a common carrier. Nor is the fact that there was no fixed rate for carriage of goods from Dillibari to Desangmukh of any assistance to the appellants ' contention that they were not common carriers, for the law does not require that a common carrier must have one and the same rate for all goods. The law was stated thus by Blackburn J. in G. W. Ry. Co., vs Sutton (4) : "There was nothing in the common law to hinder a carrier from carrying for favoured individuals at an unreasonably low rate, or even gratis. All that the law required was, that he should"not charge any more than was reasonable." "The requirement of equality of charges", as pointed out by Prof. Otto Kahn Fre und in the law of Carriage by Inland Transport (3rd Edition) at P. 190, "in so far as it existed, was entirely the creation of statute while the common law regards inequality as nothing more than possible evidence of 'unreasonableness. " That there was no fixed charge for carriage from Dillibari can not therefore be any reason to think that appellants were not common carriers in respect carriage from Dillibari. (4) at. 812 The next argument of Mr. Mukherjee was almost an argument of despair. He points out that there was a Forwarding Note (exhibit B) executed by the plaintiff in respect of the journey from Desangmukh to Calcutta and there was a special contract there limiting the carriers ' liability. If the appellants were really common carriers in respect of the carriage from Dillibari, is it conceivable, he asks, that there would not be a similar Forwarding Note covering the carriage from Dillibari to Desangmukh? That however is a totally wrong approach to the problem. A common carrier may restrict his liability by special contract. 'But the absence of a special contract cannot show that he is not a common carrier. The fact that the appellants did not,take care to make a special contract in respect of carriage from Dillibari is therefore wholly irrelevant. On a consideration of the entire evidence therefore we are of opinion that the appellants did profess by their. conduct, even if not by any public notice, that they would carry goods indiscriminately for all those who ask for such carriage from Dillibari to various places on their main steamer route. They were thus common carriers in respect of the carriage of the plaintiff 's goods from Dillibari. A last contention was raised, again, on the Forwarding Note. It was urged. that in any case this should be interpreted as covering the carriage from Dillibari also. In terms the Forwarding Note was limited to the contract of carriage as from Desangmukh to Calcutta. By no method of construction of the document can it be extended to the journey ' from Dillibari. All the contentions raised in the appeal therefore fail. The appeal is accordinly dismissed with costs. Appeal dismissed.

The question whether a carrier is a common carrier or not has to be decided on its public profession and such profession may be either by public notice or by conduct. It is immaterial if the carrying is limited to particular goods or particular routes or between specified points. Lane vs Cotton12 Mod. 474; Ingate, vs Christis, (1950) 3 Car. and K. 61 and Jhonson vs Midland Rly., Co. ; , referred to. 803 Consequently, where, as in the instant case, the steamer companies, which were by public profession common carriers in the main stream and invariably agreed, when requested, to arranged for carriage of goods by boats from stations situated on its tributary to the steamer station, accepting goods as indiscriminately as in the steamer service, were sued for loss of goods in the tributary and the High Court, while reversing the finding of the trial court as to the negligence of the companies, affirmed its decree against them on the ground that they were common carriers. Held, that the decision of the High Court was correct and must be affirmed. There could be no doubt that the service in the tributary was in the nature of a feeder service to the main route and the public profession made in respect of the latter attached to it. Held, further, that it was of no consequence that the feeder service yielded no profits. Nor was regularity or otherwise of the feeder service a relevant consideration. Law does not require that a common carrier must have fixed rate for carriage of all goods and the absence of such fixed rate in the feeder service was wholly immaterial.

N: Criminal Appeal No. 320 of 1986 193 From the Judgment and order dated 12 11.1984 of the Delhi High Court in Crl Revision No 228 of 1982 section Rangarajan, Miss Asha Rani Jain and Sanjay Parikh, for the Appellant. K.N. Chitkara and R.C. Verma for the Respondent. The Judgment of the Court was delivered by BALAKRISHNA ERADI, J. Special leave granted. Heard both sides. The five appellants were tried by the court of Additional Sessions Judge, Delhi on a charge of murder under Section 302 read with Section 34 of the Indian Penal Code. After a very detailed consideration of the evidence adduced in the case, the learned Additional Sessions Judge acquitted the appellants giving them the benefit of doubt The respondent herein, who is a son of the deceased victim of the murder preferred a criminal revision petition before the High Court of Delhi under Section 397/401 Cr. P.C. challenging the order of acquittal passed by the learned Additional Sessions Judge. A learned Single Judge of the High Court allowed that revision petition, set aside the acquittal of the appellants and remitted the case to the trial court for re trial Aggrieved by the said judgment of the High Court the appellants have come up to this Court with this appeal and the main contention raised by them is that the learned Single Judge of the High Court has transgressed the bounds of his revisional jurisdiction in reappreciating the evidence and setting aside their acquittal. After hearing counsel appearing on both sides we have unhesitatingly come to the conclusion that the aforesaid contention of the appellants is well founded and has to be upheld. Briefly stated, the prosecution case was that on the mid night of 3rd and 4th June, 1980 while Laxman Singh (P.W. 1) was sleeping on the terrace of his house in the DESU Colony, Delhi along with his cousin Moti Lal (P.W. 7), they heard the noise of a quarrel and loud shouting from the lane below and on looking down from the terrace they found that deceased Ram Chander was being beaten by accused 194 Nos. 1 and 4 (Appellant Nos. 1 and 4). Thereupon they rushed to the place of the incident. One Babu Lal who was residing in the adjoining quarter also came there and when all the three tried to intervene and separate deceased Ram Chander and the two accused, the first accused called out to Bhagwat (second accused), who was looking down from his adjacent quarter asking him why he was just watching while Ram Chander was assaulting them. In response to the said call it is alleged that Bhagwat along with the remaining accused came there carrying lathis in their hands. There appears to have been a free for all fight. It is said that Ram Chander wielding an iron handle of a hand pump was giving blows to the accused and he in turn was being beaten by lathis by the remaining persons. It is the case of the prosecution that Ram Chander was administered lathi blows on his head by accused Nos. 1 and 2, as a result of which he fell down bleeding and died on the spot. Thereafter all the five accused are said to have run away from the scene with their lathis. In support of the prosecution story, three persons were examined as eye witnesses namely, P.W 1, P.W. 2 and P.W. 7. P W. 2, however, turned hostile and did not support the prosecution version in his deposition before the trial court. The learned Additional Sessions Judge discussed at length the testimony given by P.W 1 and P W. 7 as well as the medical evidence adduced in the case. He found that there were serious discrepancies and glaring inconsistencies between the versions spoken by P.W. 1 and P.W. 7 and that the medical evidence also did not support their version of the incident. In the result he found that the testimony of these eye witnesses could not be safely relied on and the prosecution had failed to prove its case beyond reasonable J doubt. The learned Single Judge of the High Court has thought it fit to re appreciate the evidence of the two eye witnesses as well as the testimony given by the medical doctor who conducted the postmortem on the body of the deceased Ram Chander. By such a process of elaborate re examination of the evidence the learned Single Judge was inclined to reach a conclusion different from that recorded by the learned Additional Sessions Judge regarding the acceptability of the testimony of P.W 1 and P.W. 7. It is on this basis that the learned Judge has proceeded to set aside the acquittal of the appellants and order a retrial of the case after virtually recording findings in regard to the credibility of the evidence given by the witnesses relied on by the prosecution. 195 Even in an appeal against an order of acquittal no interference will be made with the judgment of the trial court except in rare and exceptional cases where there has been some manifest illegality in the approach to the case or the appreciation of the evidence or where the conclusion of fact recorded by the Trial Judge is wholly unreasonable so as to be liable to be characterised as perverse and there has been a resultant miscarriage of justice The revisional jurisdiction of the High Court while dealing with an order of acquittal passed by the trial court is more narrow in its scope. It is only in glaring cases of injustice resulting from some violation of fundamental principles of law by the trial court, that the High Court is empowered to set aside the order of the acquittal and direct a retrial of the acquitted accused. From the very nature of this power it should be exercised sparingly and with great care and caution. In K.C. Reddy vs State of Andhra Pradesh, ; , this Court had occasion to consider the scope of the revisional jurisdiction conferred on the High Court in relation to orders of acquittal passed by the trial court and after referring to two earlier decisions of this Court reported in D. Stenbens vs Nosibolla, [1951] S R. 284 and Jogendranath Jha vs Polailal Biswas, ; the legal position was explained thus: "These two cases clearly lay down the limits of the High Court 's jurisdiction to interfere with an order of acquittal in revision; in particular, Jogendranath Jha 's case stresses that it is not open to a High Court to convert a finding of acquittal into one of conviction in view of the provisions of section 439(4) and that the High Court cannot do this even indirectly by ordering re trial. What had happened in that case was that the High Court reversed pure findings of facts based on the trial court 's appreciation of evidence but formally complied with sub section (4) by directing only a re trial of the appellants without convicting them, and warned that the court retrying the case should not be influenced by any expression of opinion contained in the judgment of the High Court. In that connection this Court observed that there could be little doubt that the dice was loaded against the appellants of that case and it might prove difficult for any subordinate judicial officer dealing with the case to put aside altogether the strong views expressed in the judgment as to the credibility of the prosecution witness and the circumstances of the case in general. " 196 This decision was subsequently followed by this Court in Akalu Ahir and others vs Ramdeo Ram, ; where this Court observed: "The unrestricted right of appeal from acquittal is specifically conferred only on the State and a private complainant is given this right only when the criminal prosecution was instituted on his complaint and then also subject to special leave by the High Court. It is further provided in section 439(S), Cr. P.C. that where no appeal is brought in a case in which an appeal is provided, no proceedings by way of revision would be entertained at the instance of the party who could have appealed. The State Government, therefore, having failed to appeal, cannot apply for revision of an order of acquittal. Again on revision, the High Court is expressly prohibited from converting an acquittal into a conviction. Considering the problem facing the Court in this case in the background of this scheme, the High Court when approached by a private party for exercising its power of revision from an order of acquittal, should appropriately refrain from interfering except when there is a glaring legal defect of a serious nature which has resulted in grave failure of justice. It is not expected to act under sections 435/439, Cr. P.C. as if it is a hearing on appeal in spite of the wide language under section 435 which empowers it to satisfy itself as to the correctness, legality or propriety of a finding, sentence or order and as to the regularity of any proceeding and also in spite of the fact that under section 439 it can exercise inter alia the power conferred on a court of appeal under section 423, Cr. The power being discretionary, it has to be exercised judiciously, and not arbitrarily. Judicial discretion, as has often been said, means a discretion which is informed by tradition, methodised by analogy and disciplined by system. In Amar Chand Aggarwal vs Shanti Bose, A.I.R.1973 S.C. 799, this Court said that normally the jurisdiction of the High Court under section 439, Cr. P.C. is to be exercised only in exceptional cases when there is a glaring defect in the procedure or there is a manifest error on point of law and there has consequently been flagrant miscarriage of justice. In the background of the position just stated a private complainant can only claim a right, in common with all aggrieved parties in a criminal proceedings, to 197 invoke the revisional jurisdiction of the High Court for redress against miscarriage of justice arising from an erroneous order of acquittal." The same position has been reiterated by this Court in Satyendra Nath Dutta and Anr. vs Ram Narain, [1975] 2 S.C.R. 743. It is unfortunate that the High Court did not keep in mind the principles laid down in the aforesaid rulings regarding the limits of its revisional powers while dealings with an order of acquittal passed by the subordinate court. The mere circumstance that a finding of fact recorded by the trial court may in the opinion of the High Court be wrong, will not justify the setting aside the order of acquittal and directing a re trial of the accused. In the present case the judgment of the learned Additional Sessions Judge did not suffer from any manifest illegality. The dominant justification of the order of acquittal recorded by the trial court is the view it took of the evidence of the two eye witnesses. Having carefully gone through the records of the case we are satisfied that it was a possible view and it cannot be characterised as illegal or perverse. It may well be that the learned Single Judge of the High Court was not inclined to agree with the said view on the basis of his independent scrutiny and appreciation of the evidence adduced in the case but that would not furnish any justification for interference in revision with the order of acquittal passed by the learned Additional Sessions Judge. Even in an appeal the Appellate Court would not have been justified in interfering with an acquittal merely because it was inclined to differ from the findings of fact reached by the trial court on the appreciation of the evidence. The revisional power of the High Court is much more restricted in its scope. We accordingly hold that the High Court has clearly transgressed the limits of its revisional jurisdiction under Section 439(4) of Cr. P.C. in setting aside the order of acquittal passed by the Additional Sessions Judge and directing a re trial of the case. The appeal is therefore allowed, the judgment of the High Court is set aside and the order of the acquittal passed by the trial court will stand restored. A.P.J. Appeal allowed.

The appellants, after trial by the Court of Additional Sessions Judge on a charge of murder under section 302 read with section 34 of the Indian Penal Code, were acquitted giving them the benefit of doubt. The respondent, a son of the deceased victim, preferred a criminal revision petition before the High Court under section 397/401 Cr. P.C. challenging the order of acquittal. A Single Judge allowed the revision petition, set aside the acquittal of the appellants and remitted the case to the trial Court for re trial. The appellants appealed to this Court, inter alia, contending that the Single Judge of the High Court has transgressed the bounds of his revisional jurisdiction in reappreciating the evidence and setting aside their acquittal. Allowing the appeal, ^ HELD: 1. The High Court has clearly transgressed the limits of its revisional jurisdiction under section 439(4) of Cr. P.C. in setting aside the order of acquittal passed by the Additional Sessions Judge and directing a re trial of the case. [197F] 2. Even in an appeal against an order of acquittal no interference will be made with the judgment of the trial Court except in rare and exceptional cases where there has been some manifest illegality in the approach to the case or in the appreciation of the evidence or where the conclusion of fact recorded by the Trial Judge is wholly unreasonable so as to be liable to be characterised as perverse and there bas been a 192 resultant miscarriage of justice. The revisional jurisdiction of the High Court while dealing with an order of acquittal passed by the trial court is more narrow in its scope. It is only in glaring cases of injustice resulting from some violation of fundamental principles of law by the trial court, that the High Court is empowered to set aside the order of the acquittal and direct a re trial of the acquitted accused. From the very nature of this power it should be exercised sparingly and with great care and caution. [195A C] K.C. Reddy vs State of Andhra Pradesh, ; ; D. Stenbens vs Nosibolla, ; ; Jogendranath Jha vs Polailal Biswas, ; ; Akalu Ahir and Ors. vs Ramdeo Ram, [1974] I SCR 130; Amar Chand Aggarwal vs Shanti Bose; , ; and Satyendra Nath Dutta and Anr. vs Ram Narain, ; followed. The mere circumstance that a finding of fact recorded by the trial court may in the opinion of the High Court be wrong, will not justify the setting aside of the order of acquittal and directing a re trial of the accused. [197C] In the instant case, the High Court did not keep in mind the principles regarding the limits of its revisional powers while dealing with the order of acquittal passed by the Additional Sessions Judge, which did not suffer from any manifest illegality. The dominant justification of the order of acquittal recorded by the trial court is the view it took of the evidence of the two eye witnesses. Having carefully gone through the records of the case, this Court is satisfied that it was a possible view and it cannot be characterised as illegal or perverse. It may well be that the Single Judge of the High Court was not inclined to agree with the trial Court 's finding on the basis of his independent scrutiny and appreciation of the evidence adduced in the case but that would not furnish any justification for interference in revision with the order of acquittal passed by the Additional Sessions Judge. Even in an appeal the Appellate Court would not have been justified in interfering with an acquittal merely because it was inclined to differ from the findings of fact reached by the trial court on the appreciation of the evidence. The revisional power of the High Court is much more restricted in its scope. [ 197B F]

Appeals Nos. 557 & 558 of 1965, Appeal by special leave from the judgment and order dated September 19, 1962 of the High Court of Judicature at Madras (in Tax Case No. 87 of 1960). R. Ganapathy lyer, for the appellant. R. M. Hazarnavis and R. N. Sachthey, for the respondent. The Judgment of the Court was delivered by Shah, J. Sree Meenakshi Mills Ltd. a company incorporated under the Indian Companies Act with its registered office at Madurai carries on business of cotton spinning and weaving. In the premises "of the factory of the Company there are installed 80 handloorns 393 These handlooms were found inadequate to weave the yarn pro duced by the factory and a part of the yarn produced was distributed to weavers outside the factory who were engaged by the Company to weave the yarn into cloth. Under cl. 18 B of the Cotton Cloth and Yarn (Control), Order, 1945, issued by the Government of India, the Textile Commissioner was authorized to direct ally manufacturer or dealer or any class of manufacturers or dealers, inter alia, not to sell or deliver any yarn or cloth of specified description except to such person or persons and subject to such conditions as the Textile Commissioner may specify. On February 7, 1946, the Textile Commissioner issued an order directing the Company not to sell or deliver any yarn manufactured by the Company except to such person or persons as the Textile Commissioner may specify. It was recited in the order that "nothing in this Order shall apply to a sale or delivery made, in pursuance of clause 18 A of the said order, to any dealer in yarn not engaged in the production of cloth on handlooms or powerless". The Company addressed a letter on February 13, 1946 to the Textile Commissioner submitting that the prohibition in general terms was ultra wires the authority conferred by the Cotton Cloth and Yarn (Control) Order. The Company continued notwithstanding the prohibition to deliver yarn to weavers and did so till February 20, 1946. This yarn was seized under the orders of the Textile Commissioner. On February 20,1946, the Provincial Textile Commissioner, purporting to act in exercise of authority conferred upon him by a notification issued by the Government of India, issued an order addressed to the Company that: "You should accordingly confine your delivery to the categories of persons notified below: (a) Licensed yarn dealers (in accordance with the said 18 A of the Control Order). (b) to consumers who purchased yarn directly from you during the basic period 1940 42 (in accordance with my circular letter dated 4th January 1946 referred to above). (c) your handloom factory situated in the premises of your Mill at Madurai (just the quantity of yam required). "Note: Any other delivery of yarn by you which is not covered by a special order or permission of the Textile Control Authorities will accordingly be a contravention of the Textile Commissioner 's order under clause 18 B referred to above." After this order was issued, the Company did not deliver any yarn to weavers. On March 4, 1946 the Company filed a petition for a writ of nandamus in the High Court of Madras under section 45 of the Specific 394 Relief Act praying for an order directing the Provincial Textile Commissioner, Madras to desist from seizing the yarn supplied to the weavers at or around Madurai and Rajapalayam for the purpose of converting the yarn belonging to the Company into cloth; to restore to the Company or to direct the Provincial Textile Commissioner and his subordinates to restore the yam already seized; and to forbear from seizing or to direct the subordinates of the Provincial Textile Commissioner to forbear from seizing the yarn that may be entrusted to the weavers by the Company in the usual course of business according to the practice already obtaining for conversion into cloth. This petition was dismissed by Kunhi Raman, J, and the order of dismissal was confirmed in appeal by the High Court. The matter was then carried in appeal to the Privy Council. The Judicial Committee dismissed the appeal filed by the Company. They held, agreeing with the High Court, that the expression "deliver" in cl. 18 B sub cl. 1(b) of the Cotton Cloth and Yarn (Control) Order, 1945, is used in its ordinary broad sense of handing over possession, as distinct from passing of property, and would include delivery of possession to a bailer. Accordingly, delivery of part of its yarn by the Company to owners of handlooms outside the mill premises for conversion of the yarn into cloth for the Company was in contravention of the order made under cl. 18 B sub. (1) (b). The Judicial Committee also held that a petition under section 45 of the , directing the Provincial Textile Commissioner to desist from seizing the yam supplied to the weavers and to restore to the Company the yarn already seized was incompetent as the acts in respect of which relief was asked for took place outside the limits of the ordinary original civil jurisdiction of the High Court. The Company spent Rs. 20,035/ in prosecuting the proceed ings under section 45 of the and had also to pay Rs. 5,912/ as costs to the Government of the unsuccessful appeal to the Judicial Committee. In its returns of income the Company claimed deduction of the amounts of Rs. 20,035/ and Rs., 5,9121/for the assessment years 1949 50 and 1950 51 respectively as being expenditure wholly and exclusively laid out for the purpose of its business. The claims were rejected by the departmental authorities, and by the Income tax Appellate Tribunal. The Tribunal then referred the following question to the High Court of Judicature at Madras : "Whether the expenses of Rs. 20,035/ incurred in the assessment year 1949 50 and Rs. 5,912/ (relating to the assessment year 1950 5 1) being the cost paid to Government as directed by the Privy Council were expenses incurred in the ordinary course of business and allowable as deductions?" 395 The question as framed is somewhat vague. But it is common ground that the Company claimed deduction under section 10(2) (xv) of the Indian Income tax. Act, 1.922 on the footing that the two amounts represented expenditure laid out wholly and, exclusively by the Company for the purpose of its business. The High Court answered the question in the negative. 'With special leave, the Company has appealed to this Court. The Tribunal has found that after the order dated February 20, 1946 was issued, the Company did not deliver yarn to any weaver. it is recited in the judgment of the Tribunal that a "correct order by the proper authorities was passed" on February 20, 1946 and, thereafter the Company did not distribute any yarn to weavers. The averments made by the Company in the petition under section 45 of the , are somewhat involved, but in substance the claim of the Company was that the Provincial Textile Commissioner was incompetent to pass the order dated February 20, 1946 which placed restrictions on the business of the Company and the order was "likely to cause irreparable and irretrievable injury", and it was prayed that an order do issue under section 45 of the restraining the Provincial Textile Commissioner from enforcing the order and the Textile Commissioner be prohibited by an order from seizing the yarn delivered to the weavers outside the factory and be further ordered to restore the yarn already seized. No clear averment was made in the petition about the date on which the yarn seized had been delivered by the Company to the weavers. This petition failed, because the High Court had no jurisdiction to entertain the petition, and also because the expression "deliver" used in cl. 18 B of the Control Order included handing over of yarn to the weavers outside the premises of the factory for conversion into cloth. But expenditure incurred in prosecuting a civil proceeding relating to the business of an assessee is admissible as expenditure laid out wholly and exclusively for the purpose of the business even if the proceeding is decided against the assessee. It was held by this Court in Commissioner of Income Tax, West Bengal vs H. Hirjee(1) that the deductibility of expenditure under section 10(2) (xv) must depend on the nature and purpose of the legal proceeding in relation to the business whose profits are under computation and cannot be affected by the final outcome of that. proceeding. The proceeding started by the Company was in relation to the business of the Company. The Company was thereby seeking relief against interference by the executive authorities in the conduct of its business in the manner in which it was being carried on previously. It was also seeking to obtain an order for restoration of its goods which were seized. It may be (1) ; : ; M15Sup CI/66 12 396 granted that the Company was, in starting the proceeding, ill advised. However wrongheaded, ill advised, unduly optimistic, or overconfident in his conviction the assessee may appear in the light of the ultimate decision, expenditure in starting and prosecuting the proceeding may not be denied admission as a permissible deduction in computing the taxable income, merely because the proceeding has failed, if otherwise the expenditure is laid out for the purpose of the business wholly and exclusively, i.e. reasonably and honestly incurred to promote the interest of the business. Persistence of the assessee in launching the proceeding and carrying it from Court to Court and incurring expenditure for that purpose again cannot be a ground for disallowing the claim. Under section 10(2)(xv) of the Indian Income tax Act as amended by Act 7 of 1939 expenditure even though not directly related to the earning of income may still be admissible as a deduction. Expenditure on civil litigation commenced or carried on by an assessee for protecting the business is admissible as expenditure under section 10(2) ((xv) provided other conditions are fulfilled, even though the expenditure does not directly relate to the earning of income. Expendi ture incurred not with a view to direct and immediate benefit for purposes of commercial expediency and in order indirectly to facilitate the carrying on of the business is therefore expenditure laid out wholly and exclusively for the purposes of the trade. In Morgan (Inspector of Taxes) vs Tate & Lyle Ltd.(1) the House of Lords held that expenditure incurred by a Company engaged in :sugar refining, in a propaganda campaign to oppose the threatened nationalization of the industry was a sum wholly and exclusively laid out for the purpose of the Company 's trade and was an admissible deduction from its profits for income tax purposes. majority of the House held that the object of the expenditure being to preserve the assets of the Company from seizure and so to enable it to carry on and earn profits, the expenditure was a permissible deduction under r. 3(a) of the Rules applicable to cases (1) & (2) of Sch. D of the Income tax Act, 1918. The object of the petition filed by the Company was to secure a declaration that the order dated February 20, 1946 insofar as it sought to put restrictions upon the right of the Company to carry on its business in the manner in which it was accustomed to do was unauthorized and to prevent enforcement of that order: thereby the Company was seeking to obtain an order from the Court ,enabling the business to be carried on without interference. Expenditure incurred in that behalf would without doubt be expenditure laid out wholly and exclusively for the purpose of the business of the Company. (1) : 397 It was argued however that the any delivered by the Company to the weavers contrary to the prohibitory order dated February 20, 1946 was attached under the order of the Provincial Textile Commissioner, and since the Company violated the prohibitory order, the primary object of the petition for mandamus instituted by the Company was to secure protection against prosecution of the Company and an order for return of the goods in respect of which an offence was committed. Expenditure incurred,in prosecuting that claim was, it was said, not laid out wholly and exclusively for the purpose of the business. Reliance was placed upon the judgment of this Court in H. Hirjee 's case(1) in which it was held that a person who was prosecuted for an offence under section 13 of the Hoarding and Profiteering Ordinance, 1943, on a charge, of selling goods at prices higher than were reasonable, in contravention of the provisions of section 6 thereof, and a part of his stock was seized and taken away, was not entitled to claim deduction under section 10(2)(xv) of the Income tax Act for the sums spent in defending the criminal proceedings against him because the expenditure could not be said to have been laid out and expended wholly and exclusively for the purpose of the business. But the assumption underlying the argument is not true. The Tribunal has in the statement of the case observed in paragraph 2 : "Subsequently, on 20th February 1946, a proper order by the appropriate authority was passed and it is common ground that after that date, at any rate no further distribution of yarn was made by the assessee. In the interim (period) between 7th February 1946 and 20th February 1946, the yarn which was distributed to the handloom weavers was the subject of seizure by the provincial Textile Commissioner and this the assesse sought to resist by filing an application under section 45 of the 1, of 1877 In the view of the Tribunal the Company did not act in violation of the terms of the order dated February 20, 1946; it cannot there fore be said that the Company was seeking to protect itself against a criminal prosecution and the consequences arising from infringement of the order dated February 20, 1946. It is true that in the judgment in appeal from the order refusing mandamus, Leach, C.J. speaking for the Court observed: (see Sree Meenakshi Mills vs Provincial Textile Commissioner, Madras(2): "In spite of the fact that this order in effect prohibited the appellant delivering yarn to owners of handlooms situate outside the mill premises, the appellant continued to deliver yarn to such weavers.", and (1) ; (2) A.I.R. 1947 Mad. 82, 398 the Judicial Committee observed: "Despite. the prohibition the appellant continued to deliver yarn to such owners in order (as already mentioned) that they might turn the yarn into. cloth and bring the article back to the mills. " (See Sree Meenakshi Mills Ltd. vs Provincial Textile Commissioner; Madras(1). But the Tribunal has observed in its order dismissing the appeal filed by the Company that it was "not disputed before" them that, after February 20, 1946 the Company did not distribute any yam. The question referred in this case must be decided not on what was found or observed by the High Court in appeal from order, in the proceedings under section 45 of the or by the Judicial Committee, but upon findings of fact recorded by. the Tribunal. It is unfortunate that the High Court took the facts, not from the statement of the case, but apparently from the judgment. of the Judicial Committee. The High Court assumed that the Company had contravened the law because it delivered yarn to weavers in contravention of the order dated February 20, 1946. But the assumption on which the discussion is founded is erroneous. The High Court also thought that expenditure to fall within the terms of section 10(2)(xv) must be one for the purpose of earning income, and there was no material on the record to show that the expenditure was so incurred. If it is intended thereby to imply that the primary motive in incurring the expenditure admissible to deduction under section 10(2)(xv) must be directly to earn income thereby, we are with respect unable to agree with that view. This Court in Commissioner of Income tax, Kerala vs Malaya lam, Plantations Ltd.(2) observed: "The expression "for the purpose of the business" is wider in scope than the expression "for the purpose of earning profits". It 's range is wide: it may take in not only the day to day running of a business, but also the rationalizationof administration and modernization of its machinery: it may include measures for the preservation of the business or for the protection of its assets and property from expropriation coercive process or assertion of hostile title: it may also comprehend payment of statutory dues and taxes imposed as a precondition to commence or for carrying (1)L.R. 76, I.A. 191, 195. (2)[1964] 7 S.C.R. 693,705:53 I.T.R. 140, 150. 399 on of a business; it may comprehend many other acts incidental to the carrying on of a business. " Expenditure incurred to resist in a civil proceeding the enforcement of a measure legislative or executive, which imposes restrictions on the carrying on of a business, or to obtain a declaration that the measure is invalid would, if other conditions are satisfied, be admissible, in our judgment, under section 10(2)(xv) as a permissible deduction in the computation of taxable income. The appeals are therefore allowed. The question referred is answered in the affirmative. The appellant Company will be entitled to its costs in this Court and the High Court. One hearing fee. y. P. Appeals allowed.

The assessee mill claimed deduction under section 10(2) (xv) of the Indian Income tax Act of the expenses incurred by it and the costs awarded to Government in respect of unsuccessful writ petition and appeals therefrom. The deduction was disallowed by the departmental authorities, and the question was answered against the assessee by the High Court. In appeals to this Court. HELD: The appeal must be allowed. The proceeding started by the assessee was in relation to the business of the assessee. Expenditure incurred to resist in a civil proceeding the enforcement of a measure legislative or executive, which imposes restrictions on the carrying on of a business or to obtain a declaration that the measure is invalid would. if other conditions are satisfied, be admissible under section 10(2) (xv) as a permissible deduction in the computation of taxable income, even though the expenditure does not directly relate to the earning of income. Expenditure may not be denied admission as a permissible deduction in computing the taxable income merely because the proceeding has failed. Persistence of the assessee in launching the proceeding and carrying it from Court to Court and incurring expenditure for that purpose again cannot be a ground for disallowing the claim. (396 B C; 399 B) Commissioner of Income tax, West Bengal vs H. Hirjee 23 I.T.R 427, Morgan (Inspector of Taxes) vs Tate & Lyle Ltd. : and Commissioner of Income tax, Kerala vs Malayalam Plantations Ltd., (196 HI 7 S.C.R. 693, referred to.

Appeal No. 293 of 1963. Appeal by special leave from the judgment and order dated December 17, 1962 of the Gujarat High Court in Civil Revision Application No. 175 of 1960. G. B. Pai, 0. C. Mathur, 1. B. Dadachanji and Ravinder Narain,for the appellant. M. section K. Sastri and M. section Narasimhan, for respondents Nos. 1 and 2. 326 August 14, 1963. The Judgment of the Court was delivered by GAJENDRAGADKAR J. This appeal by special leave raises a short question about the construction and effect of section 12(3)(a) of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947, (No. 57 of 1947) (hereinafter called 'the Act '). The appellant has been tenant of one room in a residential building known as Lalbang situated in Badekhan 's Chakla in the City of Surat since October 18, 1935. Under the rent note, she is required to pay a monthly rent of Rs. 18. On October 12, 1949, respondents 1 and 2 purchased the said property. It appears that on November 21, 1950, they served a notice on the appellant to vacate the premises let out to her on the ground that she was in arrears of rent from July 1, 1950. On receiving the said notice, the ap pellant paid a part of the rent, but again fell into arrears, and so, the respondents served a second notice on her, on February 7, 1951, claiming arrears from October 1, 1950. The appellant did not vacate the premises, nor did she pay all the arrears due from her. A third notice was accordingly served on her on March 27. 1953, in which the respondents claimed to recover arrears from January 1, 1951, that is to say, arrears for two years and two months. A few days after this notice was served, section 12(3) of the Act was amended by the Bombay Amending Act No. 61 of 1953, and the amendment came into force on the 31st March, 1954. The respondents then filed the present suit against the appellant on April 12, 1954, in which they asked for a decree for eviction against the appellant on the ground that they wanted the premises let out to the appellant bona fide for their personal use, and that the appellant was in arrears for more than six months. This suit was resisted by the appellant on several grounds. Pending the hearing of the suit, the appellant paid by installments in all Rs. 470 before the date of the decree, so that at the date when the decree was passed, no arrears were due from her. The learned trial judge upheld both the pleas made by the respondents and passed a decree for eviction against the appellant. He held that the respondents reasonably and bona fide required the property for their personal use and that the appellant was in arrears of rent for more than 327 six months. This decree was challenged by the appellant by an appeal preferred before the District Court at Surat. The learned District judge held that the respondents had failed to prove that they needed the premises reasonably and bona fide for their personal use, but he accepted their case that the appellant was in arrears of rent for more than six months and that the suit fell within the scope of section 12(3) (a) of the Act. That is how the decree passed by the trial Court was confirmed in appeal. The appellant then chal lenged the correctness of this decree by a revisional petition filed before the Gujarat High Court. This petition ultimately failed and the decree passed against her was con firmed. It is against this decision that the appellant has come to this Court: and on her behalf. Mr. Pai has con tended that the High Court was in error in holding that the requirements of section 12(3) (a) as amended justified the pas sing of the decree against the appellant. It appears that section 12 of the Act has been amended from time to time. Before the Amending Act No. 61/1953 came into force, the said section read thus: "12(1) A landlord shall not be entitled to the recovery of possession of any premises so long as the tenant pays or is ready to pay, the amount of the standard rent and permitted increases, if any, and observes and performs the other conditions of the tenancy, in so far as they are consistent with the provisions of this Act. (2)No suit for recovery of possession shall be instituted by a landlord against a tenant on the ground of non payment of the standard rent or permitted increases due, until the expiration of one month next after notice in writing of the demand of the Standard rent or permitted increases has been served upon the tenant in the manner provided in section 106 of the . (3)No decree for eviction shall be passed in any suit if, at the hearing of the suit, the tenant pays or tenders in Court the standard rent or permitted increases then due together with the costs of the suit. " The explanation to this section dealt with cases where there was a dispute between the landlord and the tenant in regard to the amount of the standard rent. With that explanation 328 we are not concerned in the present appeal. It appears that the Bombay High Court interpreted the words "at the hearing of the suit" in section 12(3) as including the hearing of the appeal arising from the suit, and so, it was held that under section 12(3) of the Act, an appeal Court cannot confirm a decree for eviction if before the passing of the order in appeal, the tenant pays or tenders in Court the standard rent or permitted increases then due together with the costs of the suit and also appeal, vide Dayaram Kashiram Shimpi vs Bansilal Raghunath Marwari(1). After section 12(3) was amended by the Amending Act 61 of 1953, the words "at the hearing of the suit" were construed by the Bombay High Court to mean that the application which the tenant ran make offering to deposit the arrears due from him must be made before the Court of first instance and cannot be reserved to be made in the Court of appeal, vide Laxminarayan Nandkishore Shravagi vs Keshardev Baijnath Narsaria(2). There is one more decision of the Bombay High Court to which reference must be made before dealing with the points raised for our decision in the present appeal. In Kurban Hussen Sajuddin vs Ratikant Nilkant and Anr.(3), it was held that the word "may" used in section 12(3) (a) as amended really meant "must" and that in cases where the conditions of the said provision were satisfied, the Court had to pass a decree for the recovery of possession in favour of the landlord. It is in the light of these decisions that we have to consider the contention of the appellant that under section 12(3) (a) as amended, it was not open to the Court to pass a decree for ejectment against her in the present proceedings. On behalf of the appellant Mr. Pai has emphasised the fact that the provisions of section 12, sub sections (1) and (2) are mandatory and there can be no doubt that they imposed ,severe restrictions on the landlord 's right to sue the tenant in ejectment. He, therefore, contends that in construing the effect of section 12(3) (a), we must bear in mind the fact that the legislature has enacted the present statute and particularly the provisions of section 12 with a view to protect the interests of the tenant. He further contends that it (1) (2) A.I.R. 1959 Bom. 329 cannot be disputed that before section 12 (3)(a) was amended, it was open to the tenant to pay the arrears at any time during the pendency of the suit, or even during the pendency of the appeal, and so, when the tenant failed or neglected to pay the arrears due from her immediately after receiving the notice of demand from, the landlord, it is easy to imagine that she knew that her failure to pay the arrears of rent immediately on receiving the notice would not lead to her eviction and that she would have the option to deposit the amount as required by section 12(3) either in the trial Court or in the Court of Appeal. That being so, he suggests that in order to avoid hardship to the tenant, section 12(3)(a) should be read is requiring the landlord to issue a fresh notice after the amended section came into force. The notice given by the landlord prior to the date of the amendment did not convey to the tenant the knowledge that her failure to comply with it would necessarily lead to her ejectment, and so, the relevant provisions of this beneficent statute should be construed in a liberal way. That, in substance, is the first contention raised by Mr. Pai before us We are unable to accept this argument. What section 12(3)(a) requires is that in cases where there is no dispute between the landlord and the tenant regarding the amount of standard rent or permitted increases, if the landlord is able to show that the tenant is in arrears for a period of six months or more and the said arrears continued in spite of the fact that a notice was served on him before the institution of the suit and no payment was made within a month thereafter, the landlord is entitled to get a decree for ejectment against the tenant. It is true, that section 12(3)(a) refers to a notice, but in terms, it refers to a notice served by the landlord as required by section 12(2), and in section 12(2) the legislature has made no amendment when it amended sub section (3). If we turn to section 12(2),. it would be noticed that the notice given by the respondents to the appellant in the present case satisfies the requirements of the said sub section. The respondents told the appellant by their notice that arrears were due from her, and there is no doubt that the arrears were not paid up by the appellant until the expiration of one month next after the notice in writing was served on her in that behalf 22 2 SC India/64 330 Section 12(2) never required the landlord to state to the tenant what the consequences would be if the tenant neg lected to pay the arrears demanded from him/her by the notice. Therefore, if the notice served by the respondents on the appellant prior to the institution of the present suit is in order and it is shown that the arrears have not been paid as required, then section 12(2) has been complied with. and it is on that footing that the case between the parties has to be tried under section 12(3)(a). Mr. Pai then contends that section 12(3)(a) seems to suggest that the neglect or failure of the tenant to make the payment of arrears must be subsequent to the date on which the Amending Act came into force. He relies on the fact that section 12(3)(a) refers to the case where the tenant "neglects to make payment ' of the rent. The section does not say "has neglected to make payment", says Mr. Pai. In our opinion, there is no substance in this argument. The use of the word "neglect" in the present tense has to be construed in the light of the fact that the clause refers to the tenant neglecting to make payment of the rent until the expiration of one month next after receipt of the notice ' and that clearly would have made the .use of the past tense inappropriate. The position, therefore, is that if notice has been served as required by section 12(2) and the tenant is shown to have neglected to comply with the notice until the expiration of one month thereafter, section 12(2) is satisfied and section 12(3) (a) comes into operation. Mr. Pai also argued that the right given to the tenant :to pay the arrears at the hearing of the suit was a vested right, and so, in construing section 12(3)(a) we should not adopt the construction which would defeat that vested right. It is not easy to accept the contention that the provisions of section 12(3)(a) really confer any vested right as such on the tenant. What section 12(3)(a) provided was that a decree ,shall not be passed in favour of the landlord in case the tenant pays or tenders in Court the standard rent at the ,hearing of the suit. This provision cannot prima facie be said to confer any right or vested right on the tenant. But even if the tenant had a vested right to pay the money in court at the hearing of the suit, we do not see how that consideration can alter the plain effect of the words used in section 12(3)(a). The suit was filed after the amended 331 section came into force, and clearly the amended provision applies to the suit and governs the decision of the dispute between the parties. If that is so, the plain meaning of section 12(3) (a) is that if a notice is served on the tenant and he has not made the payment as required within the time specified in section 12 (3) (a), the Court is bound to pass a decree for eviction against the tenant. That is the view taken by the Gujarat High Court and we are satisfied that that view clearly gives effect to the provisions of section 12(3)(a) as amended in 1953. We must accordingly hold that there is no substance in the appeal. The appeal, therefore, fails and is dismissed with costs.

The appellant was a tenant of the respondents occupying one ,room of a building belonging to them. She was in arrears of rent,. The respondents served a notice on her claiming to recover arrears of rent for a period of two years and two months. A few days after the service of this notice the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947, which governs this case was amended. The respondents thereafter filed a suit for the eviction of the appellant on the ground that they required the premises for bona fide personal use and on the ground that the appellant was in arrears of rent for more than 6 months. The suit was resisted by the appellant on several grounds but pending the hearing of the suit and before the decree was passed she deposited the entire rent due from her. The trial Judge upheld both the contentions of the respondent and decreed the eviction of the appellant. On appeal the District Judge rejected the contention of bona fide personal use put forward by the respondent but found that the appellant was in arrears of rent and dismissed the appeal. The revision filed by the present 325 appellant failed; the present appeal is by way of special leave granted by this Court. It was contended on behalf of the appellant that the provisions of section 12(1) and (2) were mandatory and that in construing section 12(3) (a) it must be borne in mind that the object of the statute and particularly section 12 was to give protection to the tenant It was further contended that before section 12(3)(a) was amended it was open to the tenant to pay the arrears at any time during the pendency of the suit or even during the pendency of the appeal. In order to avoid hardship to the tenant section 12(3)(a) should be read as requiring the landlord to issue a fresh notice after the amended section came into force. It was also urged that section 12(3)(a) suggests that the neglect or failure of the tenant to make the payment of arrears must be subsequent to the date on which the amendment came into force. Lastly it was argued that the right given to the tenant to deposit arrears was a vested right and therefore section 12(3)(a) should not be construed in such a way as to take away this vested right. Held : (i) section 12(3)(a) refers to a notice served by the landlord as required by section 12(2) and in section 12(2) the legislature has made no amendment when it amended sub section The notice served by the appellant in the present case satisfies the requirements of section 12(2). If the notice has been served as required by section 12(2) and the tenant is shown to have neglected to comply with the notice until the expiry of one month thereafter section 12(2) is satisfied and section 12(3)(a) comes into operation. (ii)S. 12(3)(a) does not confer any right or vested right on tenant and even if such a right is conferred it would not alter the plain effect of the words of section 12(3)(a). The plain meaning of section 12( 3)(a) is that if a notice is served on the tenant and he hap, not made the payment as required within the time specified in section 12(3)(a) the court is bound to pass a decree of eviction against the tenant. The appeal is dismissed. Dayaram Kashiram Shimpi vs Bansilal Ragkunath Marwari, , Laxminarayan Nandkishore Shravagi vs Keshardev Baijnath Narsaria, and Kurban Hussen Sajauddin vs Ratikant Nilkant, A.I.R. 1959 Bom.

Civil Appeal No. 5933 1983. From the Judgment and Order dated 19.2. 1980 of the Allahabad High Court in Civil Misc. Petition No. 5860 of 1978. R.K. Jain, Ms. Abha R. Sharma and R.P. Singh, for the Appellant. M .C. Dhingra for the Respondents. This appeal by special leave involves the question as to the interpretation of the provisions of Section 29 A of the U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972 (hereinafter referred to as 'the Act '). 967 The Act was enacted by the U .P. State legislature to provide, in the interest of the general public, for the regulation of letting and rent of, and the eviction of tenants from certain classes of buildings situated in urban areas, and for matters connected therewith. The Act, as originally enacted, was confined in its application to buildings only. It was amended by U.P. Act XXVIII of 1976 whereby Section 29 A was inserted with a view to give pro tection against eviction to certain classes of tenants of land on which building exists. The relevant provisions of Section 29 A read as under: "(2) This Section applies only to land let out, either before or after the commencement of this Section, where the tenant, with the landlord 's consent has erected any perma nent structure and incurred expenses in execution thereof. XXX XXX XXX (4) The tenant of any land to which this Section applies shall be liable to pay to the landlord such rent as may be mutually agreed upon between the parties, and in the absence of agreement, the rent determined in accordance with sub section (5). (5) The District Magistrate shall on the application of the landlord or the tenant determine the annual rent payable in respect of such land at the rate of ten per cent per annum of the prevailing market value of the land, and such rent shall be payable, except as provided in sub section (6) from the date of expiration of the term for which the land was let or from the commencement of this Section, whichever is later. XXX XXX XXX (7) The provisions of this section shall have effect, not withstanding anything to the contrary contained in any contract or instrument or in any other law for the time being in force. " The appellant is the owner of a plot of land measuring 30 x 65 sq. situated at Garhmukteshwar Road (Azad Road) Meerut. The said plot of land was let out by the appellant to the respondent No. 1 on March 20, 1957 at an annual rent of Rs. 170. After the said plot of 968 land had been let out to him, respondent No. 1 with the consent of the appellant constructed a building over the said plot in 1965. After the enactment of Section 29 A the appellant submitted an application on September 29, 1976, before the District Supply Officer/Delegated Authority, Meerut, for fixation of appropriate rent for the plot of land under sub section (5) of Section 29 A. The said appli cation of the appellant was dismissed by the District Supply Officer Delegated Authority by order dated April 14, 1978 on the view that the provisions of sub section (5) of Section 29 A for fixation of rent are applicable to those cases only in which there is no agreed rent and that in this case both the parties have accepted that the rent of land is Rs. 170 per year has been fixed on the basis of mutual agreement and, therefore, the question of re fixation of rent does not arise. Feeling aggrieved by the said order of the District Supply Officer the appellant filed a writ petition in the High Court of Judicature at Allahabad under Article 226 of the Constitution of India. The said writ petition was dis missed by a Division Bench of the said High Court by order dated February 19, 1980. The learned Judges have held that under Section 29 A the District Magistrate has jurisdiction to determine the rent only in those cases where there is no agreement relating to rent and if there is an agreement between the landlord and the tenant then the District Magis trate has no jurisdiction to determine the rent. The learned Judges have further found that in the instant case admitted ly an agreement existed between the appellant and the tenant that the tenant shall pay rent at the rate of Rs. 170 per annum to the appellant and as such there could be no en hancement of the rent under sub section (5) of Section 29 A. Feeling aggrieved by the said decision of the High Court the appellant has filed this appeal after obtaining special leave to appeal. Shri R.K. Jain, the learned counsel for the appellant has urged that sub section (4) of Section 29 A postulates determination of rent in accordance with sub section (5) in cases where the rent has not been mutually agreed upon between the parties. The submission of Shri Jain is that the expression "such rent as may be mutually agreed upon between the parties" in sub section (4) of Section 29 A means rent which has been mutually agreed upon after the enactment of Section 29 A and any agreement prior to the said enactment would not preclude determination of rent under Section 29 A of the Act. In support of this submission Shri Jain has invited our attention to the decision of the Full Bench of the Allahabad High Court in Trilok Chand vs Rent Control and Eviction Officer and Another, [ 969 In Trilok Chand vs Rent Control and Eviction Officer case (supra) a Full Bench of the High Court has considered the correctness of the decision of the Division Bench in the present case and has construed the provisions of Section 29 A of the Act. In that case it has been held that sub section (4) of Section 29 A precludes determination of rent only in those cases where the agreement fixing the rent was entered into subsequent to the coming into force of Section 29 A. It has been observed: "The reason is this, sub section (4) applies to the land to which Section 29 A applies. It provides that the tenant shall be liable to pay to the landlord such rent as may be agreed between the parties. In the absence of such agreed rent, the sub section further provides that the tenant is liable to pay the rent determined in accordance with subsec tion (5). These terms are clear enough and indicate that the agreement envisaged thereunder is not the agreement, existed prior to coming into force of Section 29 A. It refers to subsequent agreement only. The words "such rent as may be mutually agreed upon between the parties" refers to future agreement and not the past agreement. Subsection (4) again emphasises "such rent". Such rent, in the context means the rent to be mutually agreed upon by parties. Sub section (4) further states that in the absence of agreement, the rent has to be determined in accordance with sub section (5)." (p. 636) "Yet another reason to support our view could be found from sub section (7). It provides that notwithstanding anything to the contrary contained in any contract or instrument or in any other law for the time being in force, the provisions of Section 29 A shall have effect. It means clearly that the agreement if any existing on the date of coming into force of Section 29 A is no bar for enforcing the rights under sub section (5). Sub sections (4) and (5) shall prevail and not the antecedent agreement, if any." (p. 636) The learned Judges of the Full Bench have overruled the decision of the Division Bench in the present case. We are in agreement with the view propounded by the Full 970 Bench in Trilok Chand 's case (supra). In our opinion, the words "such rent as may be mutually agreed upon between the parties" in subsection (4) of Section 29 A envisage an agreement with regard to rent entered by the landlord and tenant after the coming into force of Section 29 A. An agreement prior to the commencement of Section 29 A would not preclude determination of rent under sub section (5) of Section 29 A. In this context it may be mentioned that the words "may be" used in sub section (4) of Section 29 A are much oftener used with reference to the future than the past or the present (Pollock C.B. in Brown vs Batchelor, 25 L .J. exhibit 299, Stroud 's Judicial Dictionary, 5th Edn. P. 1575). In sub section (4) of Section 29 A the words "may be" are preceded by the word "as" and are followed by the words "mutually agreed upon" which indicate that the words are used with reference to the future. The provisions of sub section (7) which give overriding effect to the provisions of Section 29 A over an existing contract also lend support to this construction. We are, therefore, unable to uphold the view of the learned Judges of the Division Bench of the High Court in this case that there could be no enhancement of the rent under sub section (5) of Section 29 A in view of the agreement between the appellant and the tenant that the tenant shall pay rent at the rate of Rs. 170 per annum. The appeal is, therefore, allowed. The judgment and order of the High Court dated February 19, 1980 as well as the order dated April 14, 1978, passed by the District Supply Officer/Delegated Authority, Meerut, are set aside and the matter is remanded to the District Supply Officer/Delegated Authority, Meerut for consideration of the application submitted by the appellant for fixation of rent under Section 29 A of the Act in accordance with law. No order as to costs. G.N. Appeal allowed.

In 1957, the appellant let out a plot of land to Re spondent No. 1 at an annual rent of Rs. 170. Respondent No. 1 constructed a building on the plot of land in 1968, with the consent of the appellant. After the insertion in 1976 of Section 29 A in the U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972, appellant filed an application before the delegated authority under the Act for fixation of appropriate rent for the said land under Section 29 A(5) of the Act. The application was dismissed by the authority on the ground that Section 29 A(5) was applicable only to those cases in which there was no agreed rent and since the parties, by mutual agreement, have accepted the annual rent at Rs. 170 there was no question of refixation of the rent. Aggrieved, the appellant filed a Writ Petition in the High Court, which was dismissed. The appellant has preferred this appeal, by special leave, against the said order of the High Court. Allowing the appeal, HELD: 1. The words "such rent as may be mutually agreed upon between the parties" in sub section (4) of Section 29 A of the U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972 envisage an agreement with regard to rent entered by the landlord and tenant after the coming into force of Section 29 A. An agreement prior to the com mencement of Section 29 A would not preclude determination of rent under sub section (5) of Section 29 A. Generally, the words 'may be ' are much oftener used with reference to the future than the 966 past or present. In sub section (4) of Section 29 A the words 'may be ' are preceded by the word 'as ' and are allowed by the words 'mutually agreed upon ' which indicate that the words are used with reference to the future. The provisions of sub section (7) which give overriding effect to the provisions of section 29 A over an existing contract also lend support to this construction. The High Court was not correct in holding the view that there could be no enhance ment of the rent under subsection (5) of Section 29 A in view of the agreement between the appellant and the tenant that the tenant shall pay rent at the rate of Rs. 170 per annum. [970A D] Trilok Chand vs Rent Control and Eviction Officer & Anr., ; approved. Brown vs Batchelor, ; referred to. Stroud 's Judicial Dictionary,, 5th Edn. p. 1575; re|erred to. The Judgment and order of the High Court dated Febru ary 19, 1990 as well as the order dated April 14, 1978 passed by the Delegated Authority are set aside and the matter is remanded to the Delegated Authority for considera tion of the application submitted by the appellant |or fixation of rent under Section 29 A of the Act in accordance with law. [970E F]

Appeal No. 139 of 1953. Appeal by special leave from the judgment and order dated the 22nd day of August 1950 of the Nagpur High Court in Miscellaneous Petition No. 67 of 1950. Radhey Lal Agarwala and B. P. Maheshwari, for the appellant. C. K. Daphtary, Solicitor General of India (G. N. Joshi and R. H. Dhebar, with him) for the respondents. February 15. VENKATARAMA AYYAR J. The firm of Bhagat Ram Mohanlal, which is the appellant before us, was constituted on 23 8 1940, and registered under section 26 A of the Indian Income tax Act, The partners of 146 the firm, according to the registration certificate, were (1) Bhagat Ram Mohanlal, Hindu undivided family, (2) Richpal and (3) Gajadhar, their shares being respectively 8 annas, 4 annas and 4 annas Mohan lal was the, karta of the aforesaid joint family, which consisted of himself and his two brothers, Chhotelal and Bansilal, and he entered into the partnership as such karta. The firm carried on business at Drug in Madhya Pradesh as the agent of the Government for the purchase of foodgrains, and during the accounting years ending 1943 and 1944, it made profits on which it was assessed to excess profits tax respectively of Rs. 10,023 5 0 and Rs. 13,005 5 0. During the year 1944 1945 it sustained a loss of Rs. 15,771, and adding it to the sum of Rs. 37,800 which was the standard profits for the business, the Excess Profits Tax Officer determined the deficiency of profits for the year at Rs. 53,571. Section 7 of the Excess Profits Tax Act, hereinafter referred to as the Act, provides that when there is a deficiency of profits in any chargeable accounting period in any business, the profits of that business during the previous years shall be deemed to be reduced eo extanti, and that the relief necessary to give effect to the reduction shall be given by repayment of the tax paid or otherwise. Acting under this section, the Excess Profits Tax Officer passed an order on 23 12 1946 whereby after setting off the profits of the firm for the years ending 1943 and 1944 against the deficiency of profits during the year ending 1945, he directed a refund of Rs. 23,028 10 0 which had been paid by the appellant as excess profits tax for those years. It should be mentioned that at the commencement of the assessment year 1944 1945 there was a partition in the joint family of which Mohanlal was the erstwhile karta, as a result of which he and his brothers, Chhotelal and Bansilal, became divided in status. Consequent on this disruption of the joint family, the appellant firm was reconstituted under an agreement dated 17 10 1944. Under this agreement, the partners of the firm were five in number, Richpal .Gajadhar Mohanlal, Chhotelal and Bansilal, the two 147 former being entitled to 5 annas share each and the latter three to 2 annas each. There was thus a reconstitution of the firm both with reference to the persons who were its partners and the shares which were allotted to them. Now, section 8(1) provides, omitting what is not material, that "as from the date of any change in the persons carrying on a business, the business shall be deemed to have been discontinued and a new business commenced". If this section applied, then no relief could have been granted to the appellant under section 7 of the Act. The facts relating to the reconstitution of the firm having come to the knowledge of the Commissioner of Excess Profits Tax on examination of the record, he issued a notice on 19 2 1948 calling upon the appellant to show cause why the order of the Excess Profits Tax Officer dated 23 12 1946 should not be set aside on the ground of mistake. This notice was issued under section 20 of the Act, which confers on the Commissioner authority to rectify "any mistake apparent from the record". The mistake, according to the Commissioner, consisted in the Excess Profits Tax Officer failing "to take into consideration the change in the constitution of the firm which took place on 17 10 1944, consequent on the disruption of the joint Hindu family of one of the partners". The appellant appeared in response to the notice, and contended that on the facts the proceedings under section 20 were misconceived. The facts on which the proceedings were taken were not themselves disputed. By his order dated 15 3 1950 the Commissioner held that on the facts disclosed on the record, there was a change in the persons carrying on the business, and that the award of relief under section 7 by the Excess Profits Tax Officer was a mistake. He, however, maintained the order dated 23 12 1946 with reference to Richpal and Gajadhar, and set it aside only so far as "Bhagat Ram Mohanlal, Hindu. undivided family" which was registered as partner on 23 8 1940, was concerned. He further directed that Rs. 11,514 5 0 which had been refunded to it should be collected. 148 The appellant thereupon moved the High Court of Nagpur under article 226 for a writ of certiorari quashing the order of the Commissioner dated 15 3 1950 and for a writ of prohibition restraining the authorities from collecting Rs. 11,514 5 0 under that order. By their judgment dated 22nd August 1950, the learned Judges agreed with the Commissioner that by reason of the partition there was a change in the persons who carried on the business, and that the order dated 23 12 1946 was contrary to section 8(1) of the Act. They also held that as the mistake appeared on the face of the record, the Commissioner had jurisdiction under section 20 of the Act to pass the order which he did. In the result, the writs were refused. Against this judgment, the appellant prefers this appeal by special leave. Two questions have been raised for our determination in this appeal: (1) whether by reason of the partition of the joint family and the reconstitution of the firm under the deed dated 17 10 1944 there was a change in the persons carrying on business within section 8(1) of the Act; and (2) whether the order of the Commissioner dated 15 3 1950 is bad on the ground that there was no mistake apparent from the record, as required by section 20 of the Act. On the first question, the contention of the appellant is that when Mohanlal entered into partnership with Richpal and Gajadhar on 23 8 1940 as karta of the joint family, the other members of that family, Chhotelal and Bansilal, also became in substance partners of the firm, and that when they were mentioned eo nominee as partners in the deed dated 17 10 1944 the change was more formal than substantial, and that further the fact that there was a re allotment of shares among the partners would not amount to a change in the persons who carried on the business. We agree that if all the five persons who were mentioned as partners in the deed of 1944 were partners of the old firm, there would be no change in the persons carrying on the business within section 8(1) of the Act by the mere fact of reshuffling of shares among them. But the real question that has to be decided 149 is whether Chhotelal and Bansilal were partners in the firm, which was constituted on 23 8 1940. The appellant contends that they were, both according to the Hindu law and even apart from it, under the general law relating to partnerships. It is not in dispute that Mohanlal was the karta of the joint family, and that he entered into the partnership on 23 8 1940 as such karta. It is well settled that when the karta of a joint Hindu family enters into a partnership with strangers, the members of the family do not ipso facto become partners in that firm. They have no right to take part in its management or to sue for its dissolution. The creditors of the firm would no doubt be entitled to proceed against the joint family assets including the shares of the nonpartner co parceners for realisation of their debts. But that is because under the Hindu law, the karta has the right when properly carrying on business to pledge the credit of the joint family to the extent of its assets, and not because the junior members become partners in the business. In short, the liability of the latter arises by reason of their status as copartners and not by reason of any contract of partnership by them. It would therefore follow that when Mohanlal became a partner of the firm on 23 8 1940, Chhotelal and Bansilal could not be held by reason of that fact alone, to have become partners therein. It is argued that when that firm was constituted on 23 8 1940 the persons who entered into the contract of partnership were not merely Mohanlal as karta of the joint family but also Chhotelal and Bansilal in their individual capacity, and that therefore they became partners under the ordinary partnership law. But the registration certificate of the firm while showing "Bhagat Ram Mohanlal, Hindu undivided family" as a partner, makes no mention of either Chotelal or Bansilal as partners. The contention that they also became in their individual capacity partners appears therefore to be an afterthought, and is opposed to the findings of the learned Judges of the High Court. This is sufficient, without more, to dispose of this contention. But even apart from this, 20 150 it is difficult to visualise the situation which the ap pellant contends for, of a Hindu joint family entering into a partnership with strangers through its karta and the junior members of the family also becoming at the same time its partners in their personal capacity. In Lachhman Das vs COmmissioner of Incometax(1), it was held by the Judicial Committee that the karta of a joint Hindu family could enter into partnership with an individual member of the coparcenary quoad his separate property. It was also held by the Privy Council in Sundar Singh Majithia vs Commiss ioner of Income tax(2) that there was nothing in the Income tax Act to prohibit the members of a joint Hindu family from dividing some properties, while electing to retain their joint status, and carrying on business as partners in respect of those properties. treating them as its capital. But in the present case, the basis of the partnership agreement of 1940 is that the family was joint and that Mohanlal was its karta and that he entered into the partnership as karta on behalf of the joint family. It is difficult to reconcile this position with that of Chhotelal and Bansilal being also partners in the firm in their individual capacity, which can only be in respect of their separate or divided property. If members of a coparcenary are to be regarded as having become partners in a firm with strangers, they would also become under the partnership law partners inter se, and it would cut at the very root of the notion of a joint undivided family to hold that with reference to coparcenary properties the members can at the same time be both coparceners and partners. To get over this difficulty, it was suggested that all the three coparceners might be regarded as having entered into the contract of partnership as kartas of the joint family. But even if that could be done consistently with the principles of Hindu law, the very pleadings of the appellant are against such a supposition being made, affirming as they do that it was only Mohanlal that was the karta, not the others. (1) [1948]16 I.T.R 35. (2) 151 The contention, therefore, that Chhotelal and Bansilal should be held to have become partners in the old firm under the agreement dated 23 8 1940 cannot be maintained. The question whether there was a change in the persons carrying on the business may now be considered independently of the principles of Hindu Law or the general law of Partnership and with special reference to the provisions of the Indian Excess Profits Tax Act. Section 2(17) of the Act defines a 'person ' as including a joint family. Applying this definition. , who were the members of the firm when it was constituted on 23 8 1940? Richpal, Gajadhar and "Bhagat Ram Mohanlal, Hindu undivided family" consisting of three coparceners, Mohanlal, Chhotelal and Bansilal, it being immaterial for the present purpose whether the karta of the family was only Mohanlal, or all the three of them. Then, the family became divided in 1944, and the result of it was that one of the three persons who were partners in the old firm, "Bhagat Ram Mohanlal" ceased to exist. On 17 10 1944, the two surviving partners of the old firm, Richpal and Gajadhar, entered into a contract of partnership with Mohanlal, Chhotelal and Bansilal. The erstwhile joint family of which they were members not being a partner in the new firm, it having ceased to exist by reason of the partition, there was, having regard to the definition in section 2(17) of the Act, a change in the persons who carried on the business. That was the view taken in Shanmugavel Nadar and Sons V. Commissioner of Income tax(1), and we agree with it. Whether the question is considered on the principles of Hindu law or on the provisions of the Excess Profits Tax Act, there was a change in the personnel of the firm on 17 10 1944, and the matter falls within section 8(1) of the Act. (2) The next question for determination is whether the order of the Commissioner dated 153 1950 is not justified by the provisions of section 20 of the Act for the reason that there was no mistake apparent from the record. The argument in support of this conten (1) [1948]16 I.T.R. 355, 152 tion is that the record in the Excess Profits Tax pro ceedings consisted in the present case of only the order dated 23 12 1946, that the facts on which the proceedings were taken under section 20, namely, the constitution of the firm on 23 8 1940 and the changes effected therein on 17 10 1944 were not recited therein, and that, in consequence, there were no materials on which an order could have been passed under that section. It is true that the order of the Excess Profits Tax Officer dated 23 12 1946 does not mention these facts, but they appear from the record of the income tax proceedings which included the registration certificates of the firm under section 26 A of the Income tax Act and the returns made by the firm disclosing the names of the partners and their respective shares. It is argued for the appellant that these records were inadmissible for the purpose of proceedings under section 20 of the Act, because the record referred to and contemplated by that section must be the record of the excess profits tax proceedings, and that the records of the income tax proceedings could not be used under that section. We are unable to agree with this contention. Section 22(1) of the Act provides that: "Notwithstanding anything contained in the Indian Income tax Act, 1922, all information contained in any statement or return made or furnished under the provisions of that Act or obtained or collected for the purposes of that Act may be used for the purposes of this Act". Section 22(2) similarly makes the record of the excess profits tax proceedings admissible in proceedings under the Indian Income tax Act. The fact is that the proceedings under the two Acts are interdependent. Assessments under the Excess Profits Tax Act are, subject to the special provisions of that Act, made on the basis of the assessments made under the provisions of the Indian Income tax Act. The same officers are in chargev of the proceedings under both the enactments. The order of the Excess Profits Tax Officer dated 23 12 1946 refers in terms to the order dated 28 9 1946 passed in the proceedings for assess 153 ment of income tax on the appellant, and the deficiency of profits is worked out on the basis of the loss of Rs. 15,771 as ascertained therein. We see no substance in this contention, which must accordingly be rejected. It was finally contended that the particulars recited in the registration certificate as to who were all partners of the firm were not conclusive, and that the appellant was not estopped from proving that even on 23 8 1940 the real partners were all the five persons mentioned in the deed dated 17 10 1944, and the decision in Shapurji Pellonji vs Commissioner of Income tax(1) was relied on in support of the position. It is undoubted law that the income tax authorities are not estopped by the fact of registration from going behind the certificate, and deciding who the real partners of the firm are. But can the assessee whose statement is the basis on which the registration is made and who has possibly been benefited thereby deny its correctness, when the facts mentioned therein turn out to his disadvantage? It is unnecessary to consider this point, in view of our decision that on the facts as pleaded by the appellant, Chhotelal and Bansilal could not be regarded as partners in the old firm. We may add that this contention does not appear to have been put forward before the Commissioner when notice was issued to the appellant under section 20 of the Act. If any such contention had been raised, it would have been open to the Commissioner to have taken action under section 19 of the Act. In the result, the appeal fails, and is dismissed with costs.

The firm of Bhagat Ram Mohan Lal Appellant constituted on 23 8 1940 was registered under section 26 A of the Indian Income tax Act, the partners of the firm according to the registration certificate being (1) Bhagat Ram Mohan Lal (Hindu undivided family), (2) Richpal and (3) Gajadhar, their shares being respectively 8 annas, 4 annas and 4 annas. Mohan Lal was the karta of the aforesaid family, which consisted of himself and his two brothers, Chhotelal and Bansilal. The firm made profits during the accounting years ending 1943 and 1944 on which it was assessed to excess profits tax respectively of Rs. 10,023/5/ and Rs. 13,005/5/ . During the year 19441945 it sustained a loss of Rs. 15,771 and adding thereto Rs. 37,800 the standard profits for the business, the Excess Profits Tax Officer determined the deficiency of profits for the year at Rs. 53,571 . Acting under section 7 of the Excess Profits Tax Act the Excess Profits Tax Officer passed an order on 23 12 1946 whereby after setting off the profits of the firm for the years ending 1943 and 1944 against the deficiency of profits during the year ending 1945, he directed a refund of Rs. 23,028/10/ which had been paid by the appellant as excess profits tax for those years. At the commencement of the assessment year 1944 1945 there was a partition in the joint family of which Mohan Lal was erstwhile karta, he and his two brothers becoming divided in status. As a result thereof the appellant firm was reconstituted under an agreement dated 17 10 1944, the partners of the firm being five in number. There was a reconstitution of the firm with respect to persons 144 and their shares. According to section 8(1) of the Excess Profits Tax Act the change in the persons is deemed to bring about a discontinuation of the old business and the commencement of a new one and if that section applied no relief could have been granted to the appellant under section 7 of the Act. The facts as to the reconstitution of the firm having come to the knowledge of the Commissioner of Excess Profits Tax he issued a notice under section 20 of the Excess Profits Tax Act calling upon the appellant why the order of Excess Profits Tax Officer dated 23 12 1946 should not be set aside on the ground of mistake as he had failed to take into consideration the change in the constitution of the firm which took place on 17 10 1944. After hearing the appellant the Commissioner held by his order dated 15 3 1950 that on the facts disclosed there was a change in the persons and that the award of relief under section 7 of the Act by the Excess Profits Tax Officer was a mistake. He set aside order only so far as Bhagat Ram Mohan Lal was concerned maintaining it with regard to two others. On an application for a writ of certiorari and for a writ of prohibition under article 226 of the Constitution the High Court upheld the order of the Commissioner. On an appeal by Special Leave to the Supreme Court: Held (1) that by reason of the partition of the joint family and the reconstitution of the firm under the deed dated 17 10 1944 there was a change in the persons carrying on business within section 8(1) of the Act. If all the five persons who were mentioned as partners in the deed of 1944 were partners of the old firm, there would be no change in the persons carrying on the business within section 8(1) of the Act by the mere fact of reshuffling of the shares among them but the real question for determination was whether Chhotelal and Bansilal were partners in the firm constituted on 23 8 1940. It is not in dispute that Mohanlal was the karta of the joint family, and that he entered into the partnership on 23 8 1940 as such karta. It is well settled that when the karta of a joint Hindu family enters into a partnership with strangers, the members of the family do not ipso facto become partners in that firm. They have no right to take part in its management or to sue for its dissolution. The creditors of the firm would no doubt be entitled to proceed against the joint family assets including the shares of the non partner copareeners for realisation of their debts. But that is because under the Hindu Law, the karta has the right when properly carrying on business to pledge the credit of the joint family to the extent of its assets, and not because the junior members become partners in the business. The liability of the junior members arises by reason of their status as coparceners and not by reason of any contract of partnership and it would follow therefore that when Mohanlal became a partner of the firm on 23 8 1940 Chhotelal and Bansilal could not be held by reason of that fact alone to have become partners therein, 145 Accordingly whether the question was to be considered on the principles of Hindu law or on the principles of the Excess Profits Tax Act there was a change in the personnel of the firm on 17 10 1944 and the matter fell within section 8(1) of the Act. (2) That there was a mistake apparent on the record as required by section 20 of the Act and the Commissioner had jurisdiction to pass the order dated 15 3 1950 which he did. There was no force in the contention that the record in Excess Profits Tax proceedings consisted in the present case of the only order dated 23 12 1946 and that the facts on which the proceedings were taken under section 20, namely, the constitution of the firm on 23 8 1940 and the changes effected therein on 17 10 1944 were not recited therein and that in consequence there were no materials on which an order could have been passed under that section because though the order of the Excess Profits Tax Officer dated 23 12 1946 does not mention these facts these facts appear from the record of the income tax proceedings which included the, registration certificate of the firm under section 26 A of the Income Tax Act and the returns made by the firm disclosing the names of the partners and their respective shares. Fur ther the fact is that the proceedings under the two Acts, namely, the Excess Profits Tax Act and the Income Tax Act, are interdependent. Lachman Das vs Commissioner of Income Tax ([1948] 16 I. T.R. 35), Sundar Singh Majithia vs Commissioner of Income tax ([1942] , Shanmugavel Nadar and Sons vs Commissioner of Income tax ([1948] and Shapurji Pellonji vs Commissioner of Income tax ([1945] , referred to.

Civil Appeal No. 338 of 1972. From the Judgment and Order dated the 30th January, 1970 of the Madhya Pradesh High Court in Miscellaneous Petition No. 437 of 1967. R. K. Jain, Pramod Dayal, A. D. Sangar and Ajay K. Jain for the appellant. B. Datta. Rishi Kesh, B. P. Singh and Ajit Puddiserry for the respondent. H. R. Puri and C. L. Sahu for the lnterveners. The Judgment of the Court was delivered by CHINNAPPA REDDY, J. The first respondent is a company engaged in the manufacture of sugar and employing over 1100 workers, 300 of them on a permanent basis and 800 on a seasonal basis. The permanent employees are those employed on the clerical side and in the operation and maintenance of machines. The other 800 employees are seasonal employees who are so employed because the factory itself does not work through out the year but works during a certain season every year from December when the sugarcane crop is ready for crushing until the crushing is over. The employer refused to pay bonus to the seasonal employees during the year 1964 65 on the ground that they were not employed through out the year. A dispute arose between the management and the Mazdoor Sangh which was referred to the Industrial Court Madhya Pradesh, Indore for arbitration under sec. 49 of the Madhya Pradesh Industrial Relations Act. The Industrial Court decided in favour of the workers, but on a writ petition filed by the company, the award of the arbitrator was quashed and it was held that the workers were only entitled to proportionate bonus and not the minimum bonus 960 guaranteed by sec. 10 of the . This appeal has been filed by the Mazdoor Sangh under a certificate granted by the High Court of Madhya Pradesh. To our minds the question is a simple one and is capable of only one answer. Sections 10 and 13 of the , as they stood at the relevant time, were as follows: "Section 10. PAYMENT OF MINIMUM BONUS Subject to the provisions of ss 8 and 13 every employer shall be bound to pay to every employee in an accounting year a minimum bonus which shall be four per cent of the salary or wage earned by the employee during the accounting year or forty rupees, whichever is higher, whether there are profits in the accounting year or not: Provided that where such employee has not completed fifteen years of age at the beginning of the accounting year, the provisions of this section shall have effect in relation to such employee as if for the words 'forty rupees ', the words 'twenty five rupees" were substituted." "Section 13 PROPORTIONATE REDUCTION OF BONUS IN CERTAIN CASES Where an employee has not worked for all the working days in any accounting year, the minimum bonus of forty rupees or, as the case may be, of twenty five rupees, per cent, of his salary or wage for the days he has worked in that accounting year shall be proportionately reduced. " The High Court has interpreted the words "working days in any accounting year" as meaning all those days of the year except holidays. While such an interpretation may be alright in the case of a factory which works all through the year, it would be hardly appropriate in the case of a factory which works during a particular season every year. In the case of a factory which works seasonally during an accounting year, ' working days in any accounting year" can only mean those days of the year during which the employee concerned is actually allowed to work. That was the interpretation which was placed upon the expression by the Industrial Court and 961 we think it is the proper interpretation. Having regard to the scheme and the purpose of the Act, we (30 not think that the High Court was justified in placing a different construction on the meaning of the expression "working days in any accounting year". We, therefore, set aside the judgment of the High Court and restore the award of the Industrial Court. The bonus payable to the employees will carry interest at the rate of nine per cent per annum. from the day when the bonus became due until the date of payment. appeal is allowed with costs. N.V.K Appeal allowed.

The first respondent. a Company engaged in the manufacture of Sugar, employed workers both on a permanent basis as well as on a seasonal basis. The employer refused to pay bonus to the seasonal employees on the ground that they were not employed throughout the year, and the consequential dispute that arose between the management and the appellant union was referred to the Industrial Court under section 49 of the Madhya Pradesh Industrial Relations Act. The Industrial Court decided in favour of the workers and held that they were entitled to payment of the minimum bonus. The Writ Petition filed by the company was allowed and the award of the Industrial Court was quashed. The High Court interpreted the words "working days in any accounting year" in section 13 of the as meaning all those days of the year except holidays, and held that the workers were only entitled to proportionate bonus and not the minimum bonus guaranteed under section 10 of the Act. Allowing the Appeal of the Union to this Court, ^ HELD: 1. In the case of a factory which works seasonally during an accounting year, working days in any accounting year" can only mean those days of the year during which the employee concerned is actually allowed to work. Having regard to the scheme and purpose of the , the High Court was not justified in placing a different 959 construction on the meaning of the expression "working days in any A accounting year". [960H; 961A] 2. The judgment of the High Court is set aside and the award of the Industrial Court is restored. The bonus payable to the employees will carry interest at nine per cent per annum, from the date bonus became due until date of payment. [961B]

N: Criminal Appeal No. 353 of 1986 915 From the Judgment and order dated 25.2.1986 of the Patna High Court in C.W.J.C. No. 227 of 1985. R.K. Garg and Miss Rani Jethmalani for the Petitioner. D. Goburdhan for the Respondents. The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J. This Appeal and the Writ Petition challenge the order passed by the District Magistrate, Dhanbad under section 12(2) of The Bihar Control of Crimes Act, 1981 (hereinafter called the said 'Act '). The order was passed on 15th January, 1985 and was served on the petitioner on 7th December, 1985. The impugned order was approved by the Government on 15th January, 1985. The said Act was an Act to make special provisions for the control and suppression of anti social elements with a view to maintenance of public order. Section 12 deals with power to make orders for detaining persons, Clause (d) of section 2 of the said Act states "Anti Social Element ' as a person who is: (i) either by himself or as a member of or leader of a gang, habitually commits, or attempts to commit or abets the commission of offences, punishable under Chapter XVI or Chapter XVII of the Indian Penal Code; or (ii) habitually commits or abets the commission of offences under the Suppression of Immoral Traffic in Women and Girls Act, 1956; or (iii) who by words or otherwise promotes or attempts to promote on grounds of religion, race, language caste or community or any other grounds whatsoever, feelings of enmity of hatred between different religions, racial or language groups of castes or communities; or (iv) has been found habitually passing indecent remarks to, or teasing women or girls; or (v) who has been convicted of an offence under Section 25, 26,27, 28 or 29 of the Arms Act of 1959. 916 Under section 3, the power is thereof externment on certain conditions. Sub sections(1) and (2) of section 12 of the said Act provides as follows: "12. Power to make orders detaining certain persons (l) The State Government may if satisfied with respect to any person that with a view to preventing him from acting in any manner prejudicial to the maintenance of public order and there is reason to fear that the activities of anti social elements can not be prevented otherwise than by the immediate arrest of such person, make an order directing that such anti social element be detained. (2) If, having regard to the circumstances prevailing or likely to prevail in any area within the local limits of the jurisdiction of a District Magistrate, the State Government is satisfied that it is necessary so to do, it may by an order in writing direct, that during such period as may be specified in the order, such District Magistrate may also, if satisfied as provided in sub section (1) exercise the power conferred upon by the said sub section: Provided that the period specified in an order made by the State Government under this sub section shall not, in the first instance exceed three months, but the State Government may, if satisfied as aforesaid that it is necessary so to do, amend such order to extend such period from time to time by any period not exceeding three months at any one time. " The other provisions are not material for the present purpose. In so far as these are relevant have been dealt with in the judgment under appeal and it is not necessary to reiterate these again. The High Court in the judgment under appeal has referred to the order of detention exhaustively. The High Court has narrated the facts in the judgment under appeal and stated as follows: "On 11.3.84 on a confidential information a raid was organised under the leadership of the officer in charge of 917 Dhanbad Police Station to apprehend one Sri Raghunath Singh an absconder detenu of the National Security Act. According to the confidential information he was going to witness a Qwali programme at Sijua gate within Jagota Police station. As soon as the raiding party reached the Sijua gate they saw that Raghunath Singh was coming out of club and was going towards Sijua More. The police cordoned him and told him about his arrest under the National Security Act. On this the aforementioned Raghunath Singh called one Sakaldeo Singh who was coming towards him alongwith his associates duly armed. Sakaldeo Singh immediately reached the spot and asked the detenu and his other associates to open fire. As ordered the detenu opened fire on the police party. The police party, however, escaped injury. Meanwhile Raghunath Singh took the position and opened fire from his revolver which hit the S.I. Sri. R. K. Verma, a member of the raiding party who fell on the ground. The police party also opened fire but the detenu and his associates, quite in number, under the coverage of firing fled away by breaking the cordon of the police party. The incident took place at about 1.50 a.m. in presence of a large gathering which was witnessing the Qwali programme. This created great panic and alarm amongst the people who were witnessing the programme and they started running helter and skelter for their lives. A complete confusion prevailed in the programme and the police had a hard time to control the situation. This adversely affected the public order. The people were so much afraid that they stopped moving freely in the area. It is alleged that the detenu is a terror in the area and nobody dares to speak against him. He is an uncrowned king of the Mafia World and the people living in the area are under the constant threat of life and property. A case bearing Jogta P.S. Case No. 22 dated 11.3.84 under section 142/149/307/ 326/353/333/224/225 I.P.C./27 Arms Act was registered for this incident and charge sheet had already been submitted in the case. Besides the aforesaid ground two cases have been referred to in the order of detention as background to show the criminality of the detenu: 1. Kenduadih P.S. Case No. 43 dated 11.3.83 under section 302/34 I.P.C./25(1A)/27 of the Arms Act/3/5 of the 918 Explosive Substance Act. In this case the detenu with his associates is alleged to have murdered one Sri Nagendra Singh in broad day light and a charge sheet in this case had already been submitted. The other case referred to as a background is that numbered as Kenduadih P.S. Case No. 31 dated 11.3.84 under section 25(1A)/35 Arms Act. In this case a DBBL gun looted in Keswar P.S. Case No. 5/84 under section 395 of the Indian Penal Code was recovered from the detenu 's house besides cartridges of various Arms. A charge sheet in this case had also been submitted. " Upon these materials, the District Magistrate, in his order of detention, has reiterated that he was satisfied that the petitioner is an anti social element and habitually commits offences punishable under Chapters XVI and XVII of the Indian Penal Code and as such his movements and acts adversely affect the public order. The District Magistrate further stated that he was satisfied on ground No. 1 referred to hereinbefore. In so far as Jogta P.S. Case No. 22 dated 11.3.84 is concerned, it was with regard to the same incident which resulted in the detention of the petitioner/appellant. So far as the background was concerned, the incident No. 2 mentioned therein was Kunduadih P.S. Case No. 31 dated 11.3.84 with regard to the same date i.e. 11.3.84 but with regard to a different occurrence. In that case a gun was looted and a case under I.P.C. was instituted under section 395 of the Indian Penal Code. Said gun was recovered from the petitioner 's/appellant 's house beside cartridges of various arms and a charge sheet had been submit ted in connection with Jogta P.S. Case No. 22 dated 11;3.84. These cases were pending at the relevant date. Therefore, there was no question of the acquittal or termination of the petitioner one way or the other in respect of both the incidents of the same date. In respect of Incident No. 1 referred to hereinbefore i.e. Kenduadih P.S. Case No. 43 dated 11.3.84 under section 302/34 I.P.C./25(1A)/27 Arms Act/3/5 Explosive Substance Act in which the petitioner/ appellant and his associates are alleged to have murdered Sri Nagendra Singh in the broad day light, a charge sheet had been submitted but the case had not been tried or terminated in any manner. All these cases were pending disposal. 919 There is a proximity between these incidents betraying a nature and a tendency of committing these offences. But it cannot be denied that these indicate, in the facts of this case, that the petitioner/appellant was one who habitually committed offences which are at least punishable under I.P.C. We have noted who is an anti social element under the Act. The petitioner/appellant has not yet been convicted under any of these sections referred to hereinbefore. So far as the incidents referred to hereinbefore betray criminal propensity. The first incident is of a case which was one year prior to the date of the detention order and the other incident was of the same date. If in this background, an appropriate authority charged with the implementation of the Act comes to the satisfaction that the petitioner/appellant is one who is habitually committing or abetting the commission of offences, such a conclusion is neither irrational nor unreasonable. In Vijay Narain Singh vs State of Bihar & Ors. , ; , this Act came up for consideration by this Court. But in that case the facts were entirely different. In that case the petitioner was facing trial for offences under section 302 read with section 120B, 386 and 511 of the Indian Penal Code and was allowed to be enlarged on bail by the High Court. But before the petitioner was released in that case the District Magistrate passed an order on 16th August, 1983 under section 12(2) of the said Act for detention of the petitioner. The grounds of detention supplied to the petitioner related to the incidents which took place in 1975 and 1982. There is a gap of 6 7 years in between the majority of the judges in that decision (O. Chinnappa Reddy and E.S. Venkataramiah, JJ) observed that the law of preventive detention is hard law and therefore should be strictly, construed. Care should, therefore, be taken that liberty of a person is not jeopardized unless his case fell squarely within the four corners of the relevant law. A.P. Sen, J. disagreed. It is not necessary to discuss the decision in detail in view of the facts of that case and difference of the facts in this case. We only reiterate that what the majority of the learned judges said was that while adequacy or sufficiency was no ground of a challenge, rele vancy or proximity were grounds of challenge. We may respectfully add that proximity would be relevant in order to determine whether an order of detention was arrived at irrationally or unreasonably. It is well settled that the detaining authority is not the sole judge of what national security or public order requires. But neither is the court the sole judge of the position. When power is given to an authority to act 920 on certain facts and if that authority acts on relevant facts and arrives at a decision which cannot be described as either irrational or unreasonable, in the sense that no person instructed in law could have reasonably taken that view, then the order is not bad and the Court cannot substitute its decision or opinion, in place of the decision of the authority concerned on the necessity of passing the order. See in this connection the observations of The Barium Chemicals Ltd. and Anr. vs The Company Law Board and others, Preventive detention for the social protection of the community is, as noted and observed in Vijay Narain Singh 's case (supra), a hard law but, it is a necessary evil in the modern society and must be pragmatically construed, so that it works. That is how law serves the society but does not become an impotent agent. Anti social elements creating havoc have to be taken care of by law. Lawless multitude bring democracy and constitution into disrepute. Bad facts bring hard laws hut these should be properly and legally applied. It should be so construed that it does not endanger social defence or the defence of the community, at the same time does not infringe the liberties of the citizens. A balance should always be struck. The executive authority is not the sole judge of what is required for national security or public order. But the court cannot substitute its decision if the executive authority or the appropriate authority acts on proper materials and reasonably and rationally comes to that conclusion even though a conclusion with which the court might not be in agreement. It is not for the court to put itself in the position of the detaining authority and to satisfy itself that untested facts reveal a path of crime provided these facts are relevant. See in this connection the observations of O. Chinnappa Reddy, J. in Vijay Narain Singh 's case (supra) at Pages 440 and 441. In the facts of this case and having regard to the nature of the offences, the impugned order cannot be said to be invalid and improper one. The High Court has very exhaustively dealt with this aspect and we respectfully agree with the High Court 's view. There is no analogy between the instant case and the facts of Vijay Narain Singh 's case (supra) decided by this Court. On materials on record it cannot be said as the High Court has rightly pointed out that the power of preventive detention has been 921 used to clip the 'wings of the accused ' who is involved in a criminal prosecution. Certain allegations had been made that all materials had not been supplied to the accused. This is not true because as the High Court noted that all relevant F.I.Rs were received by the petitioner and in token whereof he had put his signature in black and white in his own hand. The fact that the petitioner was in jail has been taken into consideration. How these factors and to what extent these should be taken into consideration have been discussed by this Court in Writ Petition (Criminal) No. 296 of 1986 (With SLP (Criminal) No. 1265 of 1986). It is not necessary to reiterate them. In the instant case the limits have not been transgressed. In the background of the facts of this case that all the relevant documents were in fact supplied and no other document was asked for, the observations of this Court in Ichchu Devi Chorana vs Union of India & Ors., ; at 651 on which reliance was placed by Mr. Garg on behalf of the petitioner/appellant do not apply. Mr. Goberdhan, on behalf of the State of Bihar, rightly pointed out that in the facts and circumstances of this case and the background of the scheme of this Act, there was no scope of the application of the principles reiterated by this Court in Ibrahim Ahmed Batti vs State of Gujarat and others; , at 558. Similarly the observations of this Court in State of Punjab vs Jagdev Singh Talwandi ; at 62 & 63, upon which Mr. Garg relied can have no application. All the relevant documents were supplied. All the statutory safeguards were complied with. In view of the backgrounds in the facts and circumstances of this case and the grounds mentioned in the affidavit of the District Magistrate filed before the High Court in the case under appeal as well as in Writ Petition in this Court and the facts found by the High Court which are based on cogent and reliable evidence, there is no ground for interference with the order of detention. Preventive detention as reiterated is hard law and must be applied with circumspection rationally, reasonably and on relevant materials. Hard and ugly facts make application of harsh laws imperative. The detenu 's rights and privileges as a free man should not be unnecessarily curbed. 922 No other points were urged before us. This Court has reiterated in Writ Petition (Criminal) No. 296 of 1986 with SLP (Criminal) No. 1265 of 1986 the relevant aspect of the preventive detention law. In that view of the matter it is not necessary to reiterate those principles again here. Preventive detention is a necessary evil in the modern restless society. But simply because it is an evil, it cannot be so interpreted as to be inoperative in any practical manner. Judged by all relevant standards, the impugned order of detention in the case of the petitioner cannot be said to be either illegal or beyond the authority of law. Before we conclude we must point out that another point was taken that in the order there was no mention of the period of detention. There could not be an indefinite detention. The State Government has clearly notified the period of detention of the petitioner and indicated that he should be in detention till 6th December, 1986. This appears at Annexure I at page 52 of the Paper Book of Criminal Appeal No. 353 of 1986. The said order was passed under section 22 of the said Act by the State Government. In the premises the Writ Petition fails and is dismissed. The Criminal Appeal is also dismissed. A.P.J. Petition and Appeal dismissed.

The Bihar Control of Crimes Act, 1981 was enacted to make special provisions for the control and suppression of anti social elements with a view to maintenance of public order. Section 2(d) defines "Anti Social Element" and section 12 deals with power to make orders for detaining certain persons. Upon the materials, the District Magistrate, hl his order of detention under section 12(2) has stated that he was satisfied that the petitioner was an anti social element and was habitually committing offences punishable under Chapters XVI and XVII of the Indian Penal Code and as such his movements and acts adversely affected the public order. The incidents referred to in the grounds of detention showing criminal propensity of the petitioner had taken place one year prior to the date of passing of the detention order. The petitioner unsuccessfully challenged his detention before the High Court. Dismissing the writ petition as well as the appeal, this Court, ^ HELD: 1. Preventive Detention for social protection of the community is a hard law but, it is a necessary evil in the modern society and must be pragmatically construed, so that it works. That is how law serves the society but does not become an impotent agent. Anti social elements creating havoc have to be taken care of by law. Lawless multitude bring democracy and Constitution into disrepute. Bad facts bring hard laws but these should be properly and legally applied. It should be so construed that it does not endanger social defence or the defence of the community, at the same time does not infringe the liberties of the citizens . A balance should always be struck. [920B D] 914 2. The executive authority is not the sole judge of what is required for national security or public order. But, the court cannot substitute its decision if the executive authority or the appropriate authority acts on proper materials and reasonably and rationally comes to that conclusion even though a conclusion with which the court might not be in agreement. It is not for the court to put itself in the position of the detaining authority and to satisfy itself that untested facts reveal a path of crime provided these facts are relevant. [920E F] 3. If, in the background of a case, and having regard to the definition of 'anti social element ' in section 2(d) of the Bihar Control of Crimes Act, 1981, an appropriate authority charged with the implementation of the Act, comes to the satisfaction that the detenu is one who is habitually committing or abetting the commission of offences, such a conclusion is neither irrational nor unreasonable. [919C D] 4. In the instant case, it cannot be said that the power of preventive detention has been used to clip the 'wings of the accused ' who was involved in a criminal prosecution. The fact that the petitioner was in jail has been taken into consideration and all the relevant documents were in fact supplied to him. Judged by all relevant standards the order of detention cannot be said to be either illegal or beyond the authority of law. Therefore, there was no ground for interference with the order of l detention. [920H; 921A G] 5. While adequacy or sufficiency is no ground of a challenge, relevancy or proximity are grounds of challenge and proximity would be relevant in order to determine whether an order of detention was arrived at irrationally or unreasonably. [919G H] Vijay Narain Singh vs State of Bihar & Ors., ; and The Barium Chemicals Ltd. and Anr. vs The Company Law Board and others, [1366] (Supp.) SCR 311, followed. Ichchu Devi Choraria vs Union of India & Ors., ; at 651, Ibrahim Ahmed Batti vs State of Gujarat and others; , at 558 and State of Punjab vs Jagdev Singh Talwandi, [1984] 2 SCR at 62 & 63 inapplicable.

Appeal No. 31 of 1957. Appeal from the judgment and order date September 27, 1955, of the Jammu and Kashmir High Court in Misc. Application No. 23 of 1955. Jaswant Singh, Advocate General for the State of Jammu and Kashmir and R. H. Dhebar, for the appellant. section N. Andley, J. B. Dadachanji, Rameshwar Nath and P. L. Vohra, for respondent. February 23. The Judgment of the Court was delivered by SARKAR, J. The respondent is a Civil Engineer who held various positions under the appellant, the Government of the State of Jammu and Kashmir. On September 8, 1954, while the respondent was holding the post of Development Commissioner, he was placed under suspension by an order made by the appellant on that date. Later, the appellant passed another order on February 12, 1955, demoting the petitioner to the post of a Divisional Engineer. On May 12, 1955, the respondent moved the High Court of Jammu and Kashmir under article 32(2A) of the Constitution of India as applied to the State of Jammu and Kashmir, for a writ directing the appellant not to give effect to the order dated February 12, 1955, and to recognise him as the Chief Engineer, the substantive post held by him when he was suspended, with effect from the date of suspension and with all the emoluments of that office. The High Court issued the writ as prayed. The State appeals from the judgment of the High Court, 971 In the view that, we think, must be taken of this case, it is unnecessary to go into the facts a great deal. At one stage of his career under the appellant, the respondent held a job of some responsibility in what was called the Sindh Valley Hydro Electric Scheme. This Scheme was for generating electric power by dams erected in the Sindyh water course and for using the water for irrigation purposes. The work on this Scheme seems to have commenced some time ago. The respondent was connected with the Scheme from 1949 till he was transferred from the work in 1953. It appears that the appellant was dissatisfied with the Progress of the work and the manner in which it had been carried out and decided to establish a Commission of Inquiry (a) to investigate into the reasons for (i) progressive rise in the estimates, (ii) the defective planning and the delay in the execution of the work and (iii) the other irregularities and (b) to fix responsibility upon the persons concerned and make appropriate recommendations. Pending the investigation various officers associated with the planning and execution of the Scheme including the respondent, were placed under suspension on September 8, 1954. Thereafter on October 20, 1954, a commission was set up by the appellant consisting of various persons. The Commission made certain enquiries and eventually submitted its report to the appellant. The appellant then made the order demoting the respondent purporting to act on the basis of the report. It is not necessary to set out the facts any more. The respondent, in his application for the writ, questioned the validity of the orders suspending and demoting him on these grounds. He alleged that the Commission did not conduct the enquiry according to the rules of natural justice. He said that he was not even informed of the charges against him nor given a proper hearing and that if he had been given proper opportunity, he would have proved that he had not been at fault at all. He also said that the appointment of the Commission could only have been made under section 2 of the Public Servants (Inquiries) Act, 1977 124 972 (Kashmir era), and must, therefore, be deemed to have been so made. He complained that the provisions of this Act were not observed by the Commission in making the enquiry. Lastly, he said that the respondent could be reduced in rank only in accordance with the procedure laid down in the Kashmir Civil Service Rules passed by the State Council Order No. 81 C of 1939 and this procedure had not been followed. In the High Court, the question as to whether these Rules had the status of law seems to have been debated at great length. The High Court took the view (that they had. We will proceed on the basis that the High Court was right and the allegations made by the respondent in his petition had been substantiated. Now, the High Court was moved to exercise its powers under article 32 (2A) of the Constitution. The order made by it cannot be upheld if it was not justified by that provision. This is not in dispute. That provision is in these terms: article 32(2A). " Without prejudice to the powers conferred by clauses (1) and (2), the 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 or 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 this Part. " The High Court can then exercise its powers under article 32 (2A) only " for the enforcement of any of the rights conferred by this Part ". The Part referred to is Part III and the rights conferred by it are the fundamental rights. Therefore, the High Court can act under cl. (2A) of article 32 only to enforce a fundamental right. The only fundamental right, however, on the violation of which learned counsel for the respondent could rely in support of the order of the High Court was that conferred by article 14, namely, the right to the equal protection of the laws. He said that the 973 respondent was entitled to have the procedure prescribed by the Kashmir Civil Service Rules followed before the order demoting him could be made and as that procedure was not followed, his client had been denied the equal protection of the laws. It seems to us that even if the Rules are a law and the respondent has not been given the benefit of them, all that can be said to have happened is that the appellant has acted in breach of the law; But that does not amount to a violation of the right to the equal protection of the laws. Otherwise, every breach of law by a Government would amount to a denial of the equal protection of the laws. We are not aware of any authority in support of that proposition and none has been cited to us. Nor are we able to find any support for it in principle. It is not the respondent 's case that other servants of the appellant had been given the benefit of those Rules and such benefit has been designedly denied only to him. It seems to us that the appeal must be allowed on the simple ground that the respondent 's petition does not show a violation of any fundamental right. The High Court had no power to act under article 32 (2A) at all. We think it right to point out that articles 226 and 311(2) of the Constitution of India had not been applied to the State of Jammu and Kashmir at any material time. No question of the respondent 's application being maintainable in view of these articles, therefore, arises. The appeal is accordingly allowed. There will be no order as to costs. Appeal allowed.

The Government of Jammu and Kashmir on the basis of the report of the commission of enquiry set up by it demoted the respondent who had been suspended earlier. The respondent moved the Jammu and Kashmir High Court under article 32(2A) of the Constitution of India as applied to the State of Jammu and Kashmir for a writ, inter alia, questioning the validity of the order suspending and demoting him, alleging violation of rules of natural justice by the commission of enquiry and breach of statutes and rules of service. Articles 226 and 311(2) of the Constitution of India bad not been applied to the State of Jammu 970 and Kashmir. The High Court acting under article 32(2A) set aside the orders suspending and demoting the respondent. Held, that the High Court had no powers to act under article 32(2A) of the Constitution of India as the writ petition did not disclose a violation of any fundamental right. Held, further, that the breach of a law by the ' Government, if any, did not amount to a denial of the equal protection of the laws, as it had not ever been alleged by the respondent that the benefit of that law had been designedly denied only to him.

ivil Appeal Nos. 850852 of 1988. From the Order dated 23.10.87 of the Customs Excise and Gold (Control) Appellate Tribunal, New Delhi in Appeal No. 830/83 B2 and C/3 105 & 3 105 of 87/B 2. Order Nos. 2091 to 2093/87 B. A.N. Haksar, H.S. Anand and Mrs. M. Karanjawala for the Appellants. G. Ramaswamy, Additional Solicitor General, Ashok K. Shrivastava and P. Parmeswaran for the Respondent. 283 The Judgment of the Court was delivered by RANGANATHAN, J. The appellant, M/s Auto Tractors Limit ed, is a company manufacturing tractors. For purposes of manufacture, the company imports certain parts and compo nents from abroad. There are two notifications on the Government of India granting certain concessions from the levy of customs duty which are applicable to such goods as have been imported by. the appellant. The first of these, namely, Notification No. 200/79 dated 28.09.1979 (as amended from time to time) exempts components "required for the manufacture of heavy commercial motor vehicles . or of tractors" from so much of the customs duty as is in excess of 25 per cent ad valorem and the whole of the additional duty leviable there on. The grant of the concession was subject to the fulfill ment of certain conditions specified in the notification. The second notification was Notification No. 179/80 dated 4.9.1980 (as amended from time to time). This notification confers an exemption in respect of parts of articles falling under specific headings in the First Schedule to the . These admittedly included parts required for the purposes of the initial setting up or for the assem bly or manufacture of "tractors", this being an article falling under heading No. 87.01(1) of the First Schedule above referred to. This exemption was in respect of so much of the customs duty as is in excess of the rate applicable to the said article (i.e. tractor) when imported complete. This concession was again subject to a certificate and recommendation from certain specified authorities, one of whom is the Directorate General of Technical Development (DGTD) The relief available to the assessee under the first notification of 1979 is, apparently, larger than the one available under the second notification of 1980. The appellant company imported three consignments. Each of the consignments was cleared after production of a cer tificate from the DGTD in the following terms: "Certified that M/s Auto Tractors Ltd., Luc know are holding a valid Industrial Licence for the manufacture of agricultural tractors and have an approved manufacturing programme. It is further certified that the above compo nents of agricultural tractors, which fall under ICT No. 87.01 (1) qualify for conces sional rate of import duty in terms of Cus tom 's Notification No. 179/F No. 370/99/79CUS. I dated 4.9.1980." (underlining ours). 284 Apparently, since the certificates of the DGTD referred only to Notification No. 179/80, the appellant was granted the concession available under the said Notification. The appel lant cleared the goods, availing itself of the said conces sion, in March, May and June 1981. Subsequently, the appellant appears to have realised that it was entitled to the larger concession available under Notification No. 200 of 1979 and that it had erred in clearing the goods after payment of duty subject only to the smaller concession available under Notification No. 179 of 1980. The appellant therefore filed three refund applica tions in August, September and October 1981 claiming refund to the extent of Rs. 1,55,342.50, Rs. 1,28,350.05 and Rs.6,46,415.44, being the difference between the entitle ments on concession under the two notifications in question. It also appears that the appellant subsequently applied to the DGTD for an amendment of the original certificates to make it clear that the goods imported by the appellant were eligible for the concession under notification No. 200 of 79. The DGTD on such application issued a certificate to the following effect: "Certified that M/s. Auto Tractors Ltd. Pra tapgarh are holding an Industrial Licence to manufacture Agricultural Tractors and have an approved manufacturing programme. It is fur ther certified that the items listed above are components of agricultural tractors falling under ITC No. 87.01 (1) and are eligible for concessional rate of import duty under custom notification No. 200/79 and 52/81 as extended by Custom 's notification No. 81/81 and 82/81 both dated 28.3. This supersedes the earlier duty concession certificate issued by this office vide Notifi cation No. 179/F No. 370/ 99/79 CUS. I dated 4.9.1980 under this office letter No. DD II/5(49)/79 Ag dated 16.1.81. " These amended certificates were also produced before the Customs authorities. The assessee 's prayer for refund was however rejected by the Assistant Collector of Customs on the ground that the assessee had failed to produce "end use" certificates. The assessee 's appeals to the Collector of Customs (Appeals) also failed. There were further appeals to the CUstoms, Excise and Gold (Control) Appellate Tribunal, which by its order dated 23.10.1987, dismissed the appeals of 285 the Appellants and hence the present appeals. The Tribunal disposed of the assessee 's claim by a short order. It observed that the Notification No. 200/79 entitled an assessee to the concessions therein mentioned on the fulfillment of three conditions: (i) A manufacturing programme as duly approved by the Direc tor General of Technical Development (D.G.T.D.) should be produced at the time of clearance of the goods. (ii) The list of components and goods should be produced duly certified by the D.G.T.D.; and (iii) An End use certificate from the same Directorate to be produced in clue course in regard to the consumption of goods in the manufacture of the motor vehicles or tractors, etc. The Tribunal proceeded to observe: "The first statutory condition of the notifi cation that the manufacturing programme of the appellants as approved by the D.G.T.D. should have been produced before the Assistant Col lector at the time of clearance of the goods was not fulfilled by the appellants. As a matter of fact at the time of clearance of the goods there was no claim even by the appel lants under Notification Nos. 200 and 201/79Cus. Their claim at that time was under a different notification No. 179/80 Cus. Which contained no requirement to produce an ap proved manufacturing programme. Since the statutory wording of the notification made it imperative for the appellants that the ap proved manufacturing programme should have been produced at the time of clearance and since this condition was not fulfilled, the entitlement of the appellants to the exemption is not accepted. The approved manufacturing programme was available all along with the appellants yet they did not produce it at the time of clearance before the Assistant Collec tor." (underlining ours) We have heard the learned counsel for the appellant as well as learned Additional Solicitor General and we are of the opinion that 286 the Tribunal has erred in denying the appellant the benefit of the Notification No. 200 of 1979. This notification made the availability of the concession thereunder subject to three conditions of which one alone is relevant for our purposes. The Tribunal thought that this condition was that the approved manufacturing programme should have been pro duced at the time of clearance and it has denied the asses see the benefit of the concession, even though satisfied that the approved manufacturing programme was all along available with the assessee, because such programme was not produced at the time of the clearance. The Tribunal has committed an error in its reading of the relevant condition of the notification. The condition is not that the manufac turing programme should be produced but that "the importer should produce evidence to the Assistant Collector of Cus toms at the time of clearance of the components or the goods that they have a programme duly approved by the Ministry of Industry and the Industrial Adviser or Additional Industrial Adviser of the Directorate General of Technical Development of the Ministry of Industry for the manufacture of such motor vehicles . . or of tractors". In other words, the importer had only to satisfy the customs authorities that it had an approved industrial programme for the manufacture of tractors by production of a certificate from the DGTD. It is indeed common ground before us that the second set of cer tificates issued by the DGTD constitutes sufficient evidence that would entitle the appellant to the concession under Notification No. 20)/1979. But the argument is that the amended certificates were produced not at the time of the clearance of the goods but only much later and that there fore the appellant is not entitled to the concession under the said notification. There is a fallacy in this approach, for, even ignoring the subsequent amendment of the certifi cates, we are of the opinion that the production of the original set of certificates at the time of clearance of the goods was sufficient compliance with the terms of the noti fication in question. We have extracted the terms of this certificate earlier. It is an unequivocal certificate by the DGTD that the appellant holds a valid industrial licence for the manufacture of agricultural tractors and that it also has an approved manufacturing programme. That is all the second set also says. There is therefore no doubt that the assessee had produced evidence, in the form of the said certificate, of the fact that the appellant had an approved industrial programme. This was the only requirement of the notification and this requirement has, in our opinion, been complied with. The further words in the first set of certif icates that the assessee was eligible for the concession under 1980 notification were mere surplusage. The omission of the assessee to request the DGTD to refer to the asses see 's entitlement under the 287 1979 notification or the omission of the DGTD to refer to the assessee 's entitlement under the 1979 notification cannot take away the assessee 's rights. The grant of conces sion depends on a certificate that the assessee had an approved manufacturing programme which is there and not the reference therein to the notifications that can be availed of by the assessee. We are therefore of the opinion that the order of the Tribunal should be set aside and that the assessee should be held entitled, in respect of the three consignments referred to earlier, to the concession available under Notification No. 200 of 79. We direct ac cordingly. The appeals are allowed but having regard to the circumstances we make no order as to costs. P.S.S Appeals allowed.

Customs Notification No. 200/79 dated 28.9.1979 exempts components required for the manufacture of heavy commercial motor vehicles or of tractors from customs duty in excess of 25 per cent ad valorem and whole of the additional duty leviable thereon. Notification No. 179/ 80 dated 4.9.1980 exempts components required for the purpose of initial setting up or for the assembly or manufacture of tractors, an article falling under Heading No. 87.01(1) of the First Schedule of the Act from so much of the customs duty as is in excess of the rate applicable to the said article when imported complete. The appellant company imported three consignments of components of agricultural tractors. The Directorate General of Technical Development issued certificate in terms of notification No. 179/80 stating that the appellant company was holding a valid industrial licence for the manufacture of agricultural tractors and have an approved manufacturing programme. The appellant cleared the goods availing itself of the said concession. Having realised later that it was entitled to the larger concession available under Notifica tion No. 200 of 1979, it filed three applications in respect of the said consignments claiming refund to the extent of the difference between the entitlements to concession under the two notifications. The DGTD issued certificates in terms of notification No. 200 of 1979 in its favour. The Assistant Collector of Customs rejected assessee 's prayer on the ground that it had failed to produce end use certificate. Its appeals before the Collector of Customs (Appeals) failed. The Customs, Excise and Gold (Control) Appellate Tribunal dismissed the appeal on the ground that the appellant did not produce the approved manufacturing programme at the time of clearance of the goods as required under Notification No. 200 of 1979. 282 In these appeals it was contended for the respondents that since the amended certificates were not produced at the time of clearance but only much later the assessee was not entitled to the concession under Notification No. 200 of 1979. Allowing the appeals, HELD: 1. The assessee is entitled to the concession available under Notification No. 200 of 1979. [287B C] 2.1 The grant of concession depends on production of evidence by the importer to the Assistant Collector of Customs at the time of clearance of the components or the goods that they have a programme duly approved by the Minis try of Industry and the Industrial Adviser or Additional Industrial Adviser of the Directorate General of Technical Development of the Ministry of Industry for the manufacture of such motor vehicles or of tractors and not on the refer ence in the certificates to the notifications that can be availed of by the assessee. [286C D; 287B] 2.2 In the instant case, the assessee had produced unequivocal evidence in the form of original set of certifi cates from DGTD at the time of clearance of the goods of the fact that the appellant held a valid industrial licence for the manufacture of agricultural tractors and that it also had an approved manufacturing programme. That was sufficient compliance with the terms of the notification in question. The omission of the assessee to request the DGTD to refer to the assessee 's entitlement under the 1979 notification or the omission of the DGTD to refer to the assessee 's entitle ment under the 1979 notification cannot take away the asses see 's rights. The order of the Tribunal is, therefore, set aside. [286F H; 287A]

ivil Appeal No. 2697 & 2698 of 1989. From the Judgment and Order dated 24.3.87 & 1.7.87 of the Andhra Pradesh High Court in Writ Petition No. 105 & 8737 of 1987. N.A. Palkhivala, P.A.S. Rao, D.N. Mishara, Ranganatha Chari and Ms. Rubi Anand for the Petitioners. S.C. Manchanda, Ms. A. Subhashini and B.B. Ahuja for the Respondents. These appeals by Special Leave are directed against the dismissal by the Andhra Pradesh High Court of Writ Petitions filed by the appellant. The appellant, Messrs Electronics Corporation of India Limited, entered into a memorandum of understanding with a Norwegian company at Paris. This was followed by an agree ment dated 2 May, 1986 executed at Hyderabad. Under that agreement the Norwegian company was to provide technical know how and technical services, including facilities for the training of personnel, to the appellant in connection with the manufacture of computers. The consideration for the technical know how and technical services was represented by Norwegian currency NOK 32 Millions equivalent to about Rs.575 lakhs. Eighty five per cent of the consideration was to be paid from credit provided by Norwegian authorities and the balance fifteen per cent was to be paid out of free foreign exchange made available by the State Bank of India, London Branch. It is not in dispute that the agreement had received the careful consideration of the Reserve Bank of India and of the Central Government. The appellant approached the Income Tax Officer for the grant of a 'No Objection Certificate ' as contemplated under section 195(2) of the 997 Income Tax Act, 1961, to enable it to remit the instalments due without any obligation to deduct any income tax at source, but the request was denied. On 23 December, 1986 the appellant made an application to the Commissioner of Income Tax for a direction to the Income tax Officer, but the Commissioner rejected the application. The Commissioner took the view that having regard to Section 9(1)(vii) and Section 195 of the Income Tax Act, 1961, the payment constituted income which was deemed to accrue or arise in India and was liable to deduction of tax at source. The appellant filed a Writ Petition against the order of the Commissioner, and assailed the constitutional validity of Section 9(1)(vii) of the Act. It was urged before the High Court that Parliament was not competent to enact Sec tion 9(1)(vii) of the Act inasmuch as the provision possess es as extra territorial operation without any nexus between the person sought to be taxed and the country seeking to tax. It was further contended that even after the introduc tion of Section 9(1)(vii) by the Finance Act of 1976 with effect from 1 June, 1976, the requirement of a business connection of a foreign Company was required, and the case was governed by CORBORANDUM CO. vs C.I.T., [1977] 108 I.T.R. 335. It was also urged that after the introduction of the Explanation by the Finance Act of 1977 with effect from 1 April, 1977 Section 9(1)(vii) creates an invidious discrimi nation among companies which had entered into a foreign collaboration agreement prior to 1 April, 1976 and those who have done so after that date, and that therefore Article 14 was violated. The High Court repelled all the contentions of the appellant and dismissed the Writ Petition. A similar Writ Petition was filed by the appellant against an order of the Commissioner of Income tax declining to direct the grant of a 'No Objection Certificate, in relation to disbursement made under a licence agreement with Messrs Control Data Indo Asia Company, U.S.A., and the Writ Petition was dis missed by the High Court for the reasons which had found favour with it in the earlier case. It is contended by learned counsel for the appellant that section 9(1)(vii) of the Income Tax Act is ultra vires inasmuch as it enables the levy of income tax on the Norwegian company in the one case and the American company in the other in circumstances which appear to show that the statute operates extra territorially without the need for any nexus between anything done in India and the person sought to be taxed. section 9(1)(vii) declares: "9(1) The following incomes shall be deemed to accrue or 998 arise in India (i). . . . . . . . . . . . . . . . (vii) income by way of fees for technical services payable by (a) the Government; or (b) a person who is a resident, except where the fees are payable in respect of services utilised in a business or profession carried on by such person outside India or for the purposes of making or earning any income from any source outside India; or (c) a person who is a non resident, where the fees are payable in respect of services uti lised in a business or profession carried on by such person in India or for the purposes of making or earning any 'income from any source in India; Explanation. For the purposes of this clause, "fees for technical services" means any consideration (including any lump sum consideration) for the rendering of any managerial, technical or consultancy services (including the provision of services of tech nical or other personnel) but does not include consideration for any construction, assembly, mining or like project undertaken by the recipient or consideration which would be income of the recipient chargeable under the head "Salaries". It seems that the Revenue is proceeding on the basis that the foreign company is liable to tax and that therefore the petitioner is obliged to deduct at source the tax pay able by the foreign company. We are informed that the serv ices are rendered by the foreign company in the nature of training abroad to personnel belonging to the appellant, and that payment to the foreign company is also effected abroad. The Revenue rests its case on section 9(1)(vii)(b) of the Act, and the question is whether on the terms in which the provi sion is couched it is ultra vires. Now it is perfectly clear that it is envisaged under our constitutional scheme that Parliament in India may make laws which operate 999 extra territorially. article 245(1) of the Constitution pre scribes the extent of laws made by Parliament. They may be made for the whole or any part of the territory of India. article 245(2) declares that no law made by Parliament shall be deemed to be invalid on the ground that it would have extra territorial operation. Therefore, a Parliamentary statute having extra territorial operation cannot be ruled out from contemplation. The operation of the law can extend to persons, things and acts outside the territory of India. The general principle, flowing from the sovereignty of States, is that laws made by one State can have no operation in another State. The apparent opposition between the two positions is reconciled by the statement found in British Columbia Electric Railway Company Limited vs The King, "A legislature which passes a law having extra territorial 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. " In other words, while the enforcement of the law cannot be contemplated in a foreign State, it can, nonetheless, be enforced by the courts of the enacting State to the degree that is permissible with the machinery available to them. They will not be regarded by such courts as invalid on the ground of such extra territoriality. But the question is whether a nexus with something in India is necessary. It seems to us that unless such nexus exists Parliament will have no competence to make the law. It will be noted that Article 245(1) empowers Parliament to enact law for the whole or any part of the territory of India. The provocation for the law must be found within India itself. Such a law may have extra territorial opera tion in order to subserve the object, and that object must be related to something in India. It is inconceivable that a law should be made by Parliament in India which has no relationship with anything in India. The only question is then whether the ingredients in terms of the impugned provi sion indicate a nexus. The question is one of substantial importance, specially as it concerns collaboration agree ments with foreign companies and other such arrangements for the better development of industry and commerce in India. In view of the great public importance of the question, we think it desirable to refer these cases to a Constitution Bench, and we do so order.

The appellant company entered into an agreement with a Norwegian Company under which the latter was to provide technical knowhow and technical services including facili ties for the training of personnel of the appellant company in connection with the manufacture of computers for a con sideration of NOK 32 Millions, Norwegian Currency, equiva lent to Rs.575 lakhs. The appellant company applied to the Income Tax Officer for 'No Objection Certificate ' under Section 195(2) of the Income Tax, 1961 in order to remit the instalments due under the agreement without deducting the tax at source but the same was refused. The application of the appellant company to the Commis sioner of Income Tax seeking a direction to the Income Tax Officer was also rejected on the ground that having regard to Sections 9(1)(vii) and 195 of the Income Tax Act, 1961 the payment to the foreign company constituted deemed accru al of Income in India and therefore the appellant was obliged to deduct at source the tax payable by the foreign company. A writ petition filed by the appellant against the order of the Commissioner and assailing the constitutional validity of Section 9(1)(vii) of the 995 Income tax Act, 1961 was dismissed by the High Court of Andhra Pradesh. A similar writ petition filed against the order of refusal of 'No Objection Certificate ' by the Com missioner of Income Tax in relation to disbursement made under an agreement with a U.S. Company was also dismissed by the High Court. Against the decision of the High Court appeals were filed in this Court challenging the vires of Section 9(1)(vii) of the Income Tax Act, 1961 contending that (i) it was extra territorial in operation, and (ii) there was no nexus between anything done in India and the persons sought to be taxed. Referring the matter to a Constitution Bench, HELD: 1. It is envisaged under our constitutional scheme that Parliament in India may make laws which operate extra territorially. Article 245(2) declares that no law made by Parliament shall be deemed to be invalid on the ground that it would have extra territorial operation. Therefore, a Parliamentary statute having extra territorial operation cannot be ruled out from contemplation. The operation of the law can extend to persons, things and acts outside the territory of India. The general principle, flowing from the sovereignty of States, is that laws made by one State can have no operation in another State. But while the enforce ment of the law cannot be contemplated in a foreign State, it can, nonetheless, be enforced by the courts of the enact ing State to the degree that is permissible with the machin ery available to them. They will not be regarded by such courts as invalid on the ground of such extra territoriali ty. [998H, 999A B, D] British Columbia Electric Railway Company Limited vs The King, , applied. But unless nexus exists Parliament will have no competence to make the law. Article 245(1) empowers Parlia ment to enact law for the whole or any part of the territory of India. The provocation for the law must be found within India itself. Such a law may have extra territorial opera tion in order to subserve the object, and that object must be related to something in India. It is inconceivable that a law should be made by Parliament in India which has no relationship with anything in India. [999E F] 2.1 In view of the great public importance of the ques tion, whether the ingredients of the impugned provision indicate a nexus 996 these cases are referred to a Constitution Bench. [999H] Corborandum Co. vs C.I.T., ; referred to.

minal Appeal No. 164 of 1970. Appeal by special leave from the Judgment and order dated the 3rd/ 4th December, 1969 of the Gujarat High Court in Criminal Appeal No. 295 of 1966. 573 R. H. Dhebar and section P. Nayar, for the appellant. A. section Qureshi, Vimal Dave and Kailash Mehta for the respondent. The Judgment of the Court was delivered by BEG, J. This is an appeal, by special leave, against the acquittal of the appellant, from a charge framed on 21 9 1967 as follows: "That you on or about the 31st day of March 1967 at about 9.30 p.m. were found in State Transport Corporation Workshop at Naroda in Ahmedabad, and you are a foreigner and you had come from Pakistan and you had been permitted to stay in India till 20th September, 1958, by Assistant Secretary to the Government of Bombay and did not depart from India before expiring of that permit issued to you by No. 19904 dated 6 12 1967 before the date 20th September 1958 and remained in India and thereby you contravened the previsions of clause 7(iii) of Foreigners Order 1948 and thereby committed an offence punishab le under Section 14 of and within my cognizance". The above mentioned charge was supported by the statement of Mahmadmiya, P. W. 2, Sub Inspector, Special Emergency Branch, Ahmedabad, showing that the appellant was working in Baroda Central State Transport Workshop when he was arrested as a consequence of the information that he was a Pakistani national who had come to India in 1955 on a Pakistani passport. The accused had produced his Pakistani passport (exhibit 11) dated 8th September, 1955. The prosecution had also relied upon an application for a visa made by the accused to the High Commissioner for India in Pakistan on 10th October, 1955, in which he had, inter alia, stated that he had migrated from India to Pakistan in 1950. Undoubtedly, the prosecution was handicapped in producing evidence to show when and how and with what intention the appellant had gone to Pakistan. It could only show how and when and on what passport he returned to this country. The accused respondent had produced credible evidence to prove: that, he was born at Dhandhuka in the State of Gujarat on 15th May, 1936; that, he was living at Dhandhuka and attendee school there until 1952 when he moved to Ahmedabad with his father; and, that he had gone to Pakistan in a state of anger while he was a minor, after a quarrel with his father who had driven him out of his house. The respondent denied that he had the intention of settling down in Pakistan. He asserted that within six months of his arrival in Pakistan he regretted having left India and tried to come back to his home. He alleged that, as he was unable to come home without a Pakistani passport, he had to apply for and get one. The respondent asserted that he was an Indian citizen when the Constitution came into force on 26th January, 1950, and that he had continued to be an Indian citizen thereafter as he had never migrated to Pakistan. His explanations about 1 M602Sup. CI/74 574 the passport and the visa application implied that he had obtained the passport by making false declarations and that the statement in the visa application, that he bad migrated to Pakistan in 1950, was one of those untrue declarations which had been made only to obtain a passPort. Probably lie had to show under the law in Pakistan that he had settled down in Pakistan and become a Pakistani national before obtaining a Pakistani passport. The judicial Magistrate had acquitted the respondent after examining the cases set up by the two sides and holding that the respondent had proved that he was an Indian citizen who had never, in fact migrated to Pakistan. In an appeal against the acquittal the High Court of Gujarat had upheld the acquittal and confirmed the finding that the appellant was an Indian citizen when the Constitution came into force on 26th January, 1950. It had also held that the appellant was a minor when he visited Pakistan. It had found it unnecessary to record a finding en the question whether the appellant 's visit to Pakistan could be held to be one made under compulsion or for a specific purpose so as to come within the class of those exceptional cases mentioned in Kulathil Mammu. vs The State of Kerala (1) in which a "migration" would not take place even if the wider test of the term migration were adopted. That wider test would apply to those who had gone to Pakistan in the period between 1st March, 1947, and the commencement of the Constitution, It has to be remembered that Article 7 of the Constitution was held, in Kulathil Mammut 's case (supra), to contain an exception to the operation of Article 5 of the Constitution for conferring citizenship of India on persons who, at the commencement of the Constitution, had satisfied the test of Indian domicile. The general principle laid down by Article 5 was that citizenship followed domicile at the commencement of the Constitution. But. the "migration" as contemplated by Article 7 was held, in Kulathil Mammu 's case (supra), to have a wider meaning than change of domicile. Hence, the view of this Court in Smt. Shanno Devi vs Managin Sain (2) was overruled. It has, however, to be remembered that in Kulathil Mammu 's case (supra), where the alleged migrant, who was also a minor at the time of the alleged migration, had gone to Karachi in 1948 which was before the commencement of the Constitution. in the case before us, the finding of the Trial Court as well as the High Court, on the evidence before them was that the appellant had. as he asserted, gone to Pakistan in 1953 54 which was after the commencement of the Constitution. Hence, the case of the respondent could not fall within the classes to which Article 7 was especially intended to apply. Article 7 had necessarily to be read with Articles 5 and 6 of the Constitution and not in isolation. 'The High Court had come to the conclusion that as the only case set up by the prosecution was that the respondent had migrated before the 26th January. 1950, it need not consider and decide the question (1) ; (2) ; 575 whether he had gone to Pakistan after 26th January, 1950, and thus had voluntarily acquired Pakistani nationality and lost Indian citizenship. If, as it rightly held, it had been proved that the respondent went to Pakistan after 26th January, 1950, Article 5 of the Constitution would still operate in his favour. The High Court rightly pointed out that, as the respondent was an Indian citizen on the date of the commencement of the Constitution, entitled to the benefit of article 5 of the Constitution, the further question whether he had lost Indian citizenship after that date or not, could only be decided by the Central Government as laid down in section 9 of the Indian . It acquitted the respondent because it thought that the prosecution had not proved the only case set up by it. We have, therefore, to examine the charge framed against the respondent so as to determine whether the view of the High Court that the only question which need be considered by it was whether the respondent was an Indian citizen on 26th January, 1950, was correct. We find, from the charge set out above, that the prosecution case was not confined to the determination of the citizenship of the respondent at the time of the commencement of the Constitution. We also find that the respondent had himself raised the question whether, on the facts set up by him, the prosecution could proceed at all in view of section 9 of the . The Trial Court had observed "The lawyer of the accused argued that under Section 9 of the the question whether any citizen of India had any time between the 26th day of January, 1950 and the commencement of the acquired the citizenship of another country was to be determined by the Central Government. A court should not decide whether an Indian citizen had acquired the citizenship of another country. The police prosecutor argued that as the accused had gone to Pakistan and he obtained Pakistani Passport the accused must be held to be national of Pakistan and so a citizen of Pakistan and so is foreigner in India and so the accused must be convicted of the offence section 14 of the Foreigners ' Act read with clause 7(3), rule (iii) of Foreigners ' Order 1948. The Court had jurisdiction to decide whether the accused is a foreigner. if the accused wanted to get it decided that he is yet citizen of India, the accused should apply to the Central Government and get decision under section 9(2) of the . The clause (3) of Schedule III of the Citizenship Rules 1956 provides that the fact that a citizen of India has obtained on any date a passport from the, Government of any other country shall be conclusive proof of his having voluntarily acquired the citizenship of the country before that date. As this accused has come from Pakistan to India, the Police Prosecutor argued, the accused should be convicted of the offence section 14 of Foreigners ' Act read with clause 7(3) (iii) of Foreigner 's order". 576 We also find from the grounds of appeal against the acquittal of the, respondent, the appellant 's application for certificate of fitness for appeal to this Court under Article 134 of the Constitution, and from the special leave petition under Article 136 of the Constitution in this Court, that the prosecution had been inviting a decision on the question whether an order of acquittal could be passed without deciding a question which fell within the purview of Section 9 of the Indian . It was not proper for the prosecuting authorities to have proceeded with the case against the respondent, when, upon the facts set up by the respondent, it became clear that the respondent could not be prosecuted or convicted without a determination under Section 9 of the , that he had voluntarily acquired the citizenship of Pakistan between 26th January, 1950, and the commencement of the on 30th December, 1955. This Court has re peatedly laid down that if such a question arises in the course of a trial, it must be left for decision by the appropriate authorities. It may be that the rules framed by the Central Government under Section 30, sub. s (2) of the Citizenship Rules, under Section 18 of the , had provided that the passport shall be conclusive proof that its holder has acquired the citizenship of the country whose passport he holds. We, however, do not know whether the Central Government has modified such a rule. When the validity of that rule came up for consideration before a Bench of seven judges of this Court, an assurance was given on behalf of the Central Government that a suitable modi fication of the relevant rule would be made. However, that question is not under consideration before us now. All we need consider here is whether the acquittal of the respondent was, in the circumstances disclosed above, justified. in view of Section 9(2) of the , which has been subject matter of several decisions of this Court (See : State of Andhra Pradesh vs Abdul Khader (1); Abdul Sattar vs State of Gujarat (2): and Akbar Khan vs Union of India (3), the question whether a person voluntarily acquired the citizenship of Pakistan during the specified period, could 'only be determined by the Central Government. In Akbar Khan 's case (Supra) it was observed by this. Court: (at page 782) "If it was found that the appellants had been on January 26, 1950, Indian citizens, then only the question whether they had renounced that citizenship and acquired a foreign citizenship would arise. That question the Courts cannot decide. The proper thing for the court would then have been to stay the suit till the Central Government decided the question whether the appellants had renounced their Indian citizenship and acquired a foreign citizenship and then dispose of the rest of the suit in such manner as the decision of the Central Government may justify ' (1) ; (2) A.I.R. [1965] S.C. 810 (3) ; 577 On principle it does not matter whether the question which can only be determined by the Central Government under Section 9 of the arises in a civil suit or in a criminal prosecution. If the real question which arises for determination is whether a person, who was an Indian citizen when the Constitution came into force, had acquired the citizenship of another country or not during the specified period, the proper thing to do for a Court where the question arises is to refuse to adjudicate on that question. In the case before us it appears that the issue was raised but not decided either in the Trial Court or in the High Court. Indeed, the judgment of the High Court shows that probably for this very reason the prosecution had tried to obtain the conviction of the respondent on the ground that he had acquired Pakistani citizenship before the commencement of the Constitution. That question had been rightly decided against the appellant. on that short ground the acquittal of the appellant could have been upheld if the prosecution case was confined to that question. But, after having examined the charge framed, the cases set up by the two sides, the contentions advanced in the Trial Court, the grounds of appeal to the High Court, and those given in the special leave petition in this Court, we think that a question of Jurisdiction of the criminal courts to record either a conviction or acquittal in the case of the respondent had properly arisen. Indeed, the real and decisive question to be considered and decided was not whether the respondent possessed Indian nationality and citizenship on 26th January, 1950, but whether he had lost that nationality at the time when he entered this country on a Pakistani passport. The respondent has been charged for overstaying contrary to the terms of the permit issued on 6th December, 1957, by which he was allowed to stay until 20th December, 1958. Therefore, it was clear that the decisive question which the Courts should have considered was whether, at the time when permission was given, and when the alleged overstay, contrary to the provisions of clause 7(iii) of the Foreigners ' Order, 1958, took place, the respondent was a foreigner. Without a decision of an appropriate authority on that question neither an acquittal nor a conviction could be recorded. As no finding can be given by criminal or civil Courts, in a case in which an issue triable exclusively by the Central Government has properly arisen, the question of burden of proof, dealt with in Section 9 of the , is immaterial. However, in view of the erroneous procedure adopted on behalf of the State in pressing for a conviction when it was clear that the charge could not succeed at all without obtaining a decision from the appropriate authority, we think that the correct order to pass in this case is 578 not just to stay further proceedings after quashing the acquittal so as to await the decision of the appropriate authority but to quash the charge itself so that the accused may be discharged. This would leave the State free to prosecute the respondent if and when a decision is obtained against him from the appropriate authority in accordance with the law. That authority will no doubt consider all the relevant facts, including the total period of the respondent 's stay in this country as compared with the short period of his stay in Pakistan and the circumstances in which the respondent alleges having obtained a Pakistani passport and made a false statement in the visa application relied upon by the prosecution. The result is that we allow this appeal and set aside the acquittal of the respondent. We also quash the charge framed against the respondent and order that he be discharged. S.B.W. Appeal allowed.

The respondent was prosecuted under clause 7(iii) of the Foreigner 's Order, 1958 read with Sec. 14 of the for over staying in India after the expiration of the permit. The respondent had entered India on a Pakistani passport. At the trial, the respondent produced evidence to show that he was a citizen of India when the Constitution came into force on 26 1 1950 and never migrated to Pakistan to obtain the citizenship of that country. He further stated that he had to obtain the Pakistani passport against was volition. The respondent further urged that without the decision of the Central Government u/s 9(2) of the as to whether he has acquired Pakistani citizenship or not, the prosecution under the was incompetent. The trial Magistrate acquitted the respondent, holding that he had proved that he was an Indian citizen who never migrated to Pakistan. The High Court upheld the acquittal as it thought that the prosecution had not proved the only case set up by it namely that the res pondent was not an Indian citizen on 26 1 1950. Quashing the charge and setting aside the acquittal, HELD : (1) The real and decisive question to be considered and decided was not whether the respondent possessed Indian nationality and citizenship on 26 1 1950 but whether he had lost that nationality at the time when he entered this country on Pakistani passport. Without a decision of the Central Government under section 9(2) of the on that question, the Criminal Court had no jurisdiction to acquit or convict a person. (II) After having examined the charge framed, the cases set up by the two sides, the contentions advanced in the trial court, the grounds of appeal of the High Court and those in the special leave petition, we think that the question regarding acquisition of foreign citizenship by the respondent was the decisive question. The respondent had himself raised the plea although he gave an impression that the prosecution was inviting a decision on the legality of the order of acquittal without obtaining a prior decision of the Central Government under Sec. 9(2) of the . It was not proper for the prosecuting authorities to have proceeded with a case without the determination of the said question under sec. 9(2) of the . [577 D] (III) In view. of the erroneous procedure adopted on behalf of the State in pressing for a conviction without obtaining a decision from the appropriate authority, quashing of the charge itself is the correct order. This would leave the State free to follow the proper procedure under law regarding the acquisition of foreign citizenship by the respondent and then to prosecute the respondent. (577 H) State of Andhra Pradesh vs Abdul Khader ; , Abdul Sattar vs State of Gujarat A.I.R. 1965 section C. 810 and Akbarkhan vs Union of India ; , followed. Kulathilmammu vs State of Kerala ; , referred to.

Appeal No. 322 of 1963. Appeal from the Judgment and order dated April 1, 1958 of the former Bombay High Court in Miscellaneous Application No. 327 of 1957. K.N. Rajagopala Sastry and R. N. Sachthey, for the appellant. 74 Bishan Narain, section P. Mehta, J. B. Dadachanji, 0. C. Mathar and Ravinder Narain, for the respondent. April 30, 1964. The Judgment of the Court was, delivered by SHAH J. M/s Lal and Company hereinafter called the assessee carry on business in Bombay as commission agents. In the course of assessment proceedings for the year 1954 55 the assessee 's books of account were examined by the Income tax Officer and it was noticed that the assessee had business connections with certain non resident parties. On March, 12, 1957, the Income tax Officer issued a notice calling upon the assessee to show cause why in respect of the assessment year 1954 55 the assessee should not be treated under section 43 of the Indian Income tax Act, 1922, as an agent in respect of twenty five non resident parties named in the notice. The assessee denied that he had "direct dealings" with any non resident party and that in any event the proposed action was barred because the period prescribed for initiation of proceeding had expired, and requested the Income tax Officer to drop the proceeding. The Income tax Officer B III Ward, Bombay issued on March 27, 1957, a notice under section 34 of the Indian Income tax Act for assessment of the assessee as an agent of the twentyfive named non resident parties. The assessee submitted a return showing his income as "nil". The Income tax Officer held that the transactions disclosed from the books of account of the assessee clearly showed that the assessee "had regular business connection with" non resident parties, that through the assessee those non resident parties were receiving income, profits and gains, and section 43 was clearly applicable to the assessee there being definite business connection between the assessee and the named non residents. He therefore treated the assessee as agent of the non resident parties, under section 43 of the Act. The Income tax Officer also rejected the contention of the assessee that action under section 34 was barred at the date of the notice issued to the assessee. Relying upon the first proviso to section 34(1) (b) (iii) inserted by the Finance Act, 1956, the Income tax Officer held that the Legislature had 75 by amendment extended the "time limit in clear and express terms so as to cover" action under section 34 against a person on whom the assessment or reassessment is to be made as an agent of a non resident person under section 43 of the Act for the assessment year 1954 55, and accordingly assessed the income of the assessee at Rs. 60,684, estimating the income of the parties residing outside the taxable territories, in the absence of accounts to be Rs. 50,000. The asessee then :filed a petition under article 226 of the Constitution in the High Court of Judicature at Bombay praying that a writ in the nature of mandamus or prohibition do issue restraining and prohibiting the Income tax Officer from giving effect to or taking any steps or proceedings by way of recovery or otherwise in pursuance of the orders of assessment. The assessee pleaded, inter alia, that the proceedings for assessment under section 34 of the Act commenced by the Income tax Officer after the expiry of one year from the end of the assessment year 1954 55 were without the authority of law. The High Court of Bombay, following its earlier judgment in section C. Prashar vs Vasantsen Dwarkadas(1) held that at the date when the notice was issued, by reason of the proviso which was in operation under section 34(1) in respect of the assessment year 1954 55 the notice was out of time and that the period provided thereby could not be extended by the Finance Act of 1956 so as to authorise the Income tax Officer to issue a notice for assessment or reassessment of the assessee as statutory agent of a party, residing outside the taxable territory. In the view of the High Court the notice dated March 27, 1957, was invalid, and a valid notice being a condition precedent to the exercise of jurisdiction under section 34, the proceeding under section 34 was not maintainable. Against the order of the High Court issuing writs prayed for by the assessee, with certificate of fitness this appeal is preferred by the Income tax Officer, Bombay. In order to appreciate the contention raised by the assessee and which has found favour with the High Court, it is necessary to refer to the relevant provisions of section 34, 76 as they stood before the section was amended by the Finance Act, 1956. The clauses relevant prescribing the period within which notice may be issued read as follows: (1) (a) If x x x (b) x x x he may in cases falling under clause (a) at any time within eight years and in cases falling under clause (b) at any time within four years of the end of that year, serve on the assessee, x x x a notice containing all or any of the requirements which may be included in a notice under sub section (2) of section 22 and may proceed to assess or re assess such income, profits or gains or recompute the loss or depreciation allowance; x x x Provided that (i) x x x (ii) x x x (iii) Where the assessment made or to be made is an assessment made or to be made on a person deemed to be the agent of non resident person under section 43, this sub section shall have effect as if for the periods of eight years and four years a period of one year was substituted. " By section 18 of the Finance Act, 1956, section 34 was extensively amended and cl. (iii) of the proviso was substituted by the following proviso: "Provided further that the Income tax Officer shall not issue a notice under this sub section for ,any year after the expiry of two years from that year if the person on whom an assessment or reassessment is to be made in pursuance of the notice is a person deemed to be an agent of non resident person under section 43." Initially a notice of assessment or re assessment under section 34(1) against a person deemed to be an agent of a non 77 resident person under section 43 could not be issued after the expiry of one year from the end of the year of assessment: under the amended section this period was extended to two years from the end of the relevant assessment year. In the course of assessment to income tax for the year 1954 55 the relevant law applicable prescribed that a notice of assessment or re assessment against a person deemed to be an agent under section 43 could not be issued after the expiry of one year from the end of the assessment year. That period expired on March 31, 1956, and after that date no notice could be issued, relying upon the law as it stood before amendment for assessment or re assessment treating the assessee as an agent of a non resident under section 43. But the Income tax Officer sought recourse to the amended provision which gave him a period of two years from the end of the assessment year, for initiating assessment proceedings, and the authority of the Income tax Officer to so act is challenged by the assessee. Section 18 of the Finance Act, 1956, is, it is common ground, not given retrospective operation before April 1, 1956. The question then is, whether the Income tax Officer may issue a notice of assessment to a person as an agent of a non resident party under the amended provision when the period prescribed for such a notice had before the amended Act came into force expired? Indisputably the period for serving a notice of re assessment under the unamended section had expired, and there was in the Act as it then stood, no provision for extending the period beyond the end of one year from the year of assess ment. The Income tax Officer could therefore commence a proceeding under section 34 on March 27, 1957, only if the amended section applied and not otherwise. The amendin Act came into force after the period provided for the issue of a notice under section 34 before it was amended had expired. It is true that there was no determinable point of time between the expiry of the prescribed time within which the notice could have been issued against the assessee under section 34 proviso (iii) before it was amended. But there was no overlapping period either. Prima facie, on the expiry of the period prescribed by section 34 as it originally stood, there was no scope for issuing a notice unless the 78 Legislature expressly gave power to the income tax Officer to issue notice under the amended section notwithstanding the expiry of the period under the unamended provision or unless there was overlapping of the period within which notice could be issued under the old and the amended pro vision. But counsel for the Commissioner submitted that at no time was the Income tax Officer bereft of authority to issue a notice under section 34 of the Indian Income tax Act, 1922. He submitted that till the mid night of March 31, 1956, notice could be issued in exercise of the powers con ferred by section 34 proviso (iii) before it was amended and notice of assessment or re assessment could also be issued under the amended provision immediately thereafter in exercise of the powers conferred by section 18 of the Finance Act, 1956. Counsel relied upon the rule contained in section 5(3) of the General Clauses Act that unless the contrary is expressed, a Central Act or Regulation shall be construed as coming into operation immediately on the expiration of the day preceding its commencement. It was submitted that this is merely a statutory recognition of the rule which is well settled that where a statute names a date on which it shall come into operation, it shall be deemed to come into force immediately on the expiration of the previous day and the law does not take into consideration fractions of a day. Reliance was placed by counsel upon Tomlinson vs Bullock( ') and English vs Cliff(2). In Tomlinson 's case( ') the question was whether an order of affiliation could be made on an application made in respect of a child born at any time of the day an August 10, 1872 under the Bastardy Act, 35 & 36 Vict. c. 65. In an application made for an order of affiliation, it was held that the order could competently be made in respect of a child born at any time of the day on the 10th of August, 1872, because the Act in the contemplation of law for this purpose came into effect from the commencement of the day on which it received the royal assent, and that normally an Act which comes into operation becomes law as soon as it commences. In English vs Cliff (2) it was held by the Court of Chancery (1) (2) 79 that the trustees under a deed of settlement dated May 13, 1892, who stood possessed of an estate during the term of twenty one years from the date of settlement upon trust to apply the rents and profits mentioned therein and who were authorised at the expiration of the said period to sell the estate could competently sell it and their action was not liable to be challenged as infringing the rule of per petuity. It was held in that case that the determination of the term of twenty one years and the conunencement of the trust for sale arising at one and the same moment, the trust was not void for remoteness on the ground that it was limited to take effect at the expiration of the term. Neither of these cases has, in our judgment, any application to the principle applicable in the present case. The power to issue a notice under the unamended Act came to an end on March 31, 1956. Under that Act no notice could thereafter be issued. It is true that by the amendment made by section 18 of the Finance Act, 1956, a notice could be issued within two years from the end of the year of assessment. But the application of the amended Act is subject to the principle that unless otherwise provided if the right to act under the earlier statute has come to an end, it could not be revived by the subsequent amendment which extended the period of limitation. The right to issue a notice under the earlier Act came to an end before the new Act came into force. There was undoubtedly no determinable point of time between the expiry of the earlier Act and the commencement of the new Act; but that would not, in our judgment, affect the application of this rule. Reliance was also placed by counsel for the Commissioner upon the rule which has prevailed in the Supreme Court of the United States of America that "a new statute should be construed as a continuation of the old one with the modifications contained in the new one, although it formally repeals the old statute, when it re enacts its substantial provisions and the two statutes are almost identical." Bear Lake & River Water Works & irrigation Company and Jarvis Conklin Mortgage Trust Company vs William Garland and Corey Brothers & Co.( '). It appears (1) I64 U.S. 1 80 to have been recognised in the Supreme Court of the United states of America in Pacific Mail section section Co. vs jolifee(1) that repeal in terms of a former statute does not necessarily indicate an intention of the legislature thereby to impair right which had arisen under the act which was repealed. As the provisions of the new act took effect simultaneously with the repeal of the old one, the Supreme Court held that the new one might more properly be said to be substituted in the place of the old one, and to continue in force, with modifications, the provisions of the old act, instead of abrogating or annulling them and re enacting the same as a new and original act. Apart from the question whether the rule so enunciated is applicable to the interpretation of Indian statutes, in this case we are not concerned with re enactment of a statute. The statute abrogates one rule of limitation, and enacts another rule with a limited retrospective operation. To such a case the rule enunciated by the Supreme Court of America, assuming it applies, attributing to the Legislature an intention to continue in force the provisions of the old Act, with a modification, so as to give to the new statute in substance operation retrospectively from the date on which the old statute was enacted, can have no application. We do not think that any such intention may be attributed to the Legislature in enacting section 18 of the Finance Act, 1956 so as to make it the basis of a liability to taxation after the expiry of the period prescribed in that behalf by the Legislature . Counsel also submitted that section 34 lays down a rule of limitation for commencing an action for assessment or re assessment, and that in the absence of an express provision to the contrary, a statute of limitation in operation at a given time governs all proceedings from the moment of its enactment, even though the cause of action on which the proceeding was based came into existence before the Act was enacted. Equating a proceeding under section 34 of the Indian Income tax Act with a suit or a proceeding in a civil court, counsel said that the law of limitation being a law of procedure, assessment proceedings including proceedings for re assessment are governed by the law in force (1) 69 U.S. 81 at the date on which they are instituted, and that the rule that the repeal of a statute without express words or clear implication in the repealing statute, cannot take away a right vested in a party acquired under the repealed statute when it was in force, is a rule of prescription and not of procedure, and notwithstanding general observations to the contrary in certain decisions, applies only to those actions in which by the determination of the period prescribed, a right to institute an action for possession of property is extnguished. Counsel relies in support of the plea on Baleswar vs Latafat(1). It is unnecessary to dilate upon this argument in any detail, or to enter upon an analysis of the numerous cases which were mentioned at the Bar to determine whether the rule that without an express pro vision, or a clear implication arising from the amending statute rights acquired under the repealed statute by the determination of the period of limitation prescribed thereby cannot be deemed to be revived, applies to suits for posses sion only. It may be sufficient to make two comments on the argument. The rule has in fact been applied to suits other than suits for possession: e.g. Mahomed Mehdi Faya vs Sakinabai(2) (a suit for restitution of conjugal rights); M. Krishnaswami Nalcker vs A. Thiruvengada Muddaliar(3) (a suit for recovery of a debt); Shambhoonath Saha vs Guruchurn Lahiri (4) (an application for execution); and Nepal Chandra Roy Chowdhury vs Niroda Sundari Ghose(5) (an application for setting aside an ex parte decree). Again soon after it was delivered the the authority of Baleswar 's case( ') was weakened by the judgment in Jagdish vs Saligram(6) where the Court doubted the correctness of the earlier view. A proceeding for assessment is not a suit for adjudication of a civil dispute. That an income tax proceedings it; the nature of a judicial proceeding between contesting parties, is a matter which is not capable of even a plausible argument. The Income tax authorities who have power to assess and recover tax are notacting as judges deciding a (1) I.L.R. 24 Pat. 383 (3) A.I.R. (1935) mad. 245(4) I.L.R. (5) I.L.R. (6) I.L.R. 24 Pat. 391 51 S.C. 6. 82 litigation between the citizen and the States: they are administrative authorities whose proceedings are regulated by statute, but whose function is to estimate the income of the taxpayer and to assess him to tax on the basis of that estimate. Tax legislation necessitates the setting up of machinery to ascertain the taxable income, and to assess tax on the income, but that does not impress the proceeding with the character of an action between the citizen and the State: The Commissioner of Inland Revenue vs Sneath(1); and Shell Company of Australia Ltd. vs Federal Commissioner of Taxation( '). Again the period prescribed by section 34 for assessment or re assessment is not a period of limitation. The section in terms imposes a fetter upon the power of the Income tax Officer to bring to tax escaped income. It prescribes different periods in different classes of cases for enforce ment of the right of the State to recover tax. It was observed by this Court in Ahmedabad Manufacturing and Calico Printing Co. Ltd. vs section C. Mehta. income tax Officer and another( '): "It must be remembered that if the Income tax Act prescribes a period during which tax due in any particular assessment year may be assessed, then on the expiry of that period the department cannot make an assessment. Where no period is prescribed the assessment can be completed at any time but once completed it is final. Once a final assessment has been made, it can only be reopened to rectify a mistake apparent from the record (section 35) or to reassess where there has been an escapement of assessment of income for one reason of another (section 34). Both these sections which enable reopening of back assessments provided their own periods of time for action but all these periods of time, whether for the firs assessment or for rectification, or for reassess ment, merely create a bar when that time passe( (1) 164 (2) [1931) A.C. 275 (3) [1963] SUPP. 2 S.C.R. 92,117 118 83 against the machinery set up by the Incometax Act for the assessment and levy of the tax. They do not create an exemption in favour of the assessee or grant an absolution on the expiry of the period. The liability is not enforceable but the tax may again become exigible if the bar is removed and the taxpayer is brought within the jurisdiction of the said machinery by reason of a new power. This is, of course, subject to the condition that the law must say that such is the jurisdiction, either expressly or by clear implication. If the language of the law has that clear meaning, it must be given that effect and where the language expressly so declares or clearly implies it, the retrospective operation is not controlled by the. commencement clause. " Counsel for the Commissioner sought to derive some support from Income tax Officer, Companies District I, Calcutta and another vs Calcutta Discount Company Ltd.( ') in which Chakravartti C.J., dealing with the effect of the Income tax and Business Profits Tax (Amendment) Act, 1948, observed: "The plain effect of the substitution of the new section 34 with effect from 30th March, 1948 is that from that date the Income tax Act is to be re ad as including the new section as a part thereof and if it is to be so read, the further effect of the express language of the section is that so far as cases coming within cl. (a) of sub section (1) are concerned all assessment years ending within eight years from 30th March, 1948 and from subsequent dates, are within its purview and it will apply to them, provided the notice con templated is given within such eight years. What is not within the purview of the section is an assessment year which ended before eight years from 30th March, 1948. (1) 84 But it may be recalled that the amending Act of 1948 with which the Court was concerned in Calcutta Discount Company 's case(1) came into force on September 8, 1948, but section 1(2) prescribed that the amendment in section 34 of the Income tax Act, 1922, shall be deemed to have come into force on March 30, 1948, and the period under the unamended section within which notice could be issued under section 34(3) against the assessee company ended on March 31, 1951. Before that date the amending Act came into operation, and at no time had the right to re assess become barred. In considering whether the amended statute applies, the question is one of interpretation i.e., to ascertain whether it was the intention of the Legislature to deprive a taxpayer of the plea that action for assessment or re assessment could not be commenced, on the ground that before the amending Act became effective, it was barred. Therefore the view that even when the right to assess or re assess has lapsed on account of the expiry of the period of limitation prescribed under the earlier statute, the Income tax Officer can exercise his powers to assess or re assess under the amending statute which gives an extended period of limitation, was not accepted in Calcutta Discount Company 's case( '). As we have already pointed out, the right to commence a proceeding for assessment against the assessee as an agent of a non resident party under the Income tax Act before it was amended, ended on March 31, 1956. It is true that under the amending Act by section 18 of the Finance Act, 1956, authority was conferred upon the Income tax Officer to assess a person as an agent of a foreign party under section 43 within two years from the end of the year of assessment. But authority of the Income tax Officer under the Act before it was amended by the Finance Act of 1956 having already come to an end, the amending provision will not assist him to commence a proceeding even though at the date whenhe issued the notice it is within the period provided by that amending Act. This will be so, notwithstanding the fact that there has been no determinable point of time between the expiry of the time provided under the old Act and the (1) 85 commencement of the amending Act. The Legislature has given to section 18 of the Finance Act, 1956, only a limited retrospective operation i.e., upto April 1, 1956, only. That provision must be read subject to the rule that in the absence of an express provision or clear implication, the Legislature does not intend to attribute to the amending provision a greater retrospectivity than is xpressly mentioned, nor to authorise the Income tax Officer to commence proceedings which before the new Act came into force had by the expiry of the period provided, become barred. The appeal fails and is dismissed with costs. Appeal dismissed.

The appellant company was carrying on business in Bombay as commission agents. In the course of assessment proceedings for the year 1954 55, the Income tax Officer noticed from the ssee 's boo s of account that the assessee had business connections with certain nonresident parties and found that the transactions disclosed that through the assessee those non resident parties were receiving income, profits and gains. He considered that section 43 of the Indian Income tax Act, 1922, was applicable to the assessee and issued on March 27, 1957, a notice under section 34 of the Act for assessment of the assessee as an agent of the said non resident parties. The assessee pleaded, inter alia, that the proceedings intiated by the Income tax Officer under section 34 were barred since the notice issued by him was after the expiry of one year from the end of the assessment year 1954 55, but the Income tax Officer rejected the contention relying on the amendment made to the proviso to section 34(l)(b)(iii) by the Finance Act, 1956, under which the period of one year was changed to two years. The amendment was given retrospective operation upto April 1, 1956, but since the power to issue a notice under the unamended Act had come to an end on March 31, 1956, the question was whether the Income tax Officer could issue a notice of assessment to a person as an agent of a non resident party under the amended provision when the period prescribed for such a notice had before the amended Act came into force expired. HELD:The proceedings initiated by the Income tax Officer by the notice dated March 27, 1957, were barred; the authority of the Incometax Officer under the Indian Income tax Act before it was amended by the Finance Act of 1956 having come to an end, the amending provision would not entitle him to commence a proceeding even though at the date when he issued the notice it was within the period provided by the amendment. Notwithstanding the fact that there was no determinable point of time between the expiry of the time provided under the old Act and the commencement of the Amendment Act, in the absence of an express provision or clear implication, the legislature could not be said to have intended to attribute to the Amending provision a greater retros pectivity than was expressly mentioned.

N: Criminal Appeal Nos. 345 346 of 1976. (Appeals by Special Leave from the Judgment and Order dated 30 9 1975 of the Karnataka High Court in Crl. Peti tions Nos. 248 and 253 of 1975). D. Mookherjee, and B.R.G.K. Achar, for the Appellant, Frank Anthony, K.B. Rohtagi and M.N. Kashyap, for the Respondents. The Judgment of the Court was delivered by CHANDRACHUD, J. These two appeals by social leave arise out of a judgment dated september 30, 1975 rendered by the High Court 115 of Karnataka in Criminal Petitions Nos. 248 and 253 of 1975. By the aforesaid judgment the High Court in the exercise of its inherent powers has quashed proceedings initiated by the State of Karnataka appellant herein, against the respond ents. The incident out of which these proceedings arise took place on December 6, 1973 in the Central Avenue of the Indian Telephone Industries Colony, Bangalore. Thyagaraja Iyer, accused No. 1, who was an employee of the Indian ' Telephone Industries Ltd. was dismissed from service on September 20, 1973 on the allegation that he had assaulted a Canteen supervisor. The complainant Ajit Dutt, Works Manager of the Crossbar Division, attempted to serve the dismissal order on him but he refused to accept it and threatened the complainant that he, the complainant, was primarily responsible for the dismissal and would have to answer the consequences. It is alleged that the I.T.I. Employees ' Union took up cudgels on his behalf and re solved to support his cause. The case of the prosecution is that accused Nos. 1 and 8 to 20 conspired to commit the murder of the complainant and that in pursuance of that conspiracy accused Nos. 1, 8 and 10 hired accused Nos. 2, a notorious criminal, to execute the object of the conspiracy. Accused No. 2 in turn engaged the services of accused Nos. 3 to 7 and eventually on the morning of December 6, 1973 accused Nos. 1 to 6 are alleged to have assaulted the complainant with knives, thereby committing offences under sections 324, 326 and 307 read with section 34. of the Penal Code. Accused No. 2 was charged separately under section 307 or in the alternative under section 326, Penal Code. By his order dated October 23, 1974 the learned Metro politan Magistrate, V Court, Bangalore directed all the 20 accused to take their trial before the Sessions Court for offences under section 324, 326 and 307 read with section 34 of the Penal Code. At the commencement of the trial before the learned First Additional District and Sessions Judge, Bangalore, two preliminary questions were raised, one by the prosecution and the other by the, accused. It was contended by the prosecution that the specification of particular sections in the committal order did not preclude the Sessions Court from framing a new charge under section 120 B of the Penal Code. On the other hand it was contended by the accused that there was no sufficient ground for proceeding with the prosecu tion and therefore they ought to be discharged. The learned Additional Sessions Judge accepted the contention of the prosecution that he had the power to frame a charge under section 120 B. The correctness of that view was not challenged before us by Mr. Frank Anthony who appears on behalf of the accused. That is as it ought to be because the power of the Sessions Court to frame an appropriate charge is not tram melled by the specifications contained in the committal order. The Sessions Court, being seized of the case, has jurisdiction to frame appropriate charges as the facts may justify or the circumstances may warrant. The contention of the accused that they ought to be discharged was accepted by the learned Additional Sessions Judge partly. lie held that there was no case against accused Nos. 11, 12 and 16 and that 116 they were therefore entitled to be discharged. By an order dated August 8, 1975 the, learned Judge. discharged those three. accused in the. exercise of his powers under section 227 of the Code of Criminal Procedure, 1973. We are informed that the correctness of that order is under challenge before the High Court in a proceeding taken by the State of Karna taka. We are not concerned with that order in these ap peals. After discharging accused Nos. 11, 12 and 16 the learned. Judge, turning to the case against the remaining accused, observed that there was "some material to hold that they have had something to do with the incident which occurred on 6 12 1973 in the I.T.I. Colony Bangalore". The learned Judge adjourned the case to September 1, 1975 "for framing specific charges as made out from the material on record against the rest of the accused persons." Two revision petitions were filed against this order, one by accused Nos. 10, 13, 14 and 15 and the other by accused Nos. 17 to 20. Those petitions were allowed by the High 'Court on the view that there was no sufficient ground for proceeding against the petitioners before it. The High Court accordingly quashed the proceedings in regard to. them which has led to these appeals. Mr. Mookerjee who. appears on behalf of the State of Karnataka contends that the High Court ought not to have exercised its; powers to quash the proceedings against the respondents without giving to the Sessions Court, which was seized of the case, an opportunity to consider whether there was sufficient material on the record on which to frame charges against the respondents. It is argued that the Sessions Court had adjourned the case for a consideration of that very question and it was not proper for the High Court to withdraw the case, as it were, and to exercise its ex traordinary powers, thereby preventing the Trial Court from examining the sufficiency of the material which it is the primary duty and function of that Court to examine. There is some apparent justification for this grievance because the language in which the sessions Court couched its order would seem to suggest that it had adjourned the case to September 1, 1975 for consideration of the question as to. whether there was sufficient ground for proceeding against the respondents. But a careful reading of the Sessions Courts judgment would reveal that while discharg ing accused Nos. 11, 12 and 16 it came, to the conclusion that insofar as the other accused were. concerned there was some material to hold that they were connected with the incident. The case was, therefore, adjourned by the Court for flaming specific charges against them. In other words, the learned Judge adjourned the case not for deciding wheth er any charge at all could be framed against the remaining accused but for the purpose of deciding as to which charge or charges could appropriately be framed on the basis of the material before him. The grievance therefore that the High Court interfered with the sessions Court 's order prematurely is not justified. The second limb of Mr. Mookerjee 's argument is that in any event the High Court could not take upon itself the task of assessing or appreciating the weight of material on the record in order to find whether any charges could be legiti mately framed against the respondents. So 117 long as there is some material on the record to connect the accused with the crime, says. the learned counsel, the case must go on and the High Court has no jurisdiction. to put a precipitate or premature end to the proceedings on the belief that the prosecution is not likely to succeed. This, in our opinion, is too broad a proposition to accept. Section 227 of the Code of Criminal Procedure, 2 of 1974, provides that: "If, upon consideration of the record of the case and the documents submitted there with, and after hearing the submissions of the accused and the prosecution in this be half, 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." This section is contained in Chapter XVIII called "Trial Before a Court of Sessions". It is clear from the provi sion that the Sessions Court has the power to discharge an accused if after perusing the record and hearing the parties he comes to the conclusion, for reasons to be re corded, that there is not sufficient ground for proceeding against the accused. The object of the provision which requires the Sessions Judge to record his reasons is to enable the superior court to examine the correctness of the reasons for which the Sessions Judge has held that there is of is not sufficient ground for proceeding against the accused. The High Court therefore is entitled to go into the reasons given by the Sessions Judge in support of his order and to determine for itself whether the order is justified by the facts and circumstances of the case. Section 482 of the New Code, which corresponds to section 561 A of the Code of 1898, provides that: "Nothing in this Code shall be deemed to limit or affect the inherent powers of the High Court to make such orders as may be necessary to give effect to any order under this Code or to prevent abuse of the process of any Court or otherwise to secure the ends of justice. " In the, exercise of this. whole some power, the High Court is entitled to quash a proceeding if it comes to the conclu sion that allowing the proceeding to continue would be an abuse of the process of the Court or that the; ends of justice require that the proceeding ought to be quashed. The saving of the High Court 's inherent powers, both in civil and criminal matters, is designed to. achieve a salu tary public purpose which is that a court proceeding ought not to be permitted to degenerate into weapon of harassment or persecution. In a criminal case, the veiled object behind a lame prosecution, the very nature of the material on which the structure of the prosecution rests and the like would justify the High Court in quashing the proceeding in the interest of justice. The ends of justice are higher than the, ends of mere law though justice has got to be. administered according to laws made by the, legislature. The compelling necessity for making these observations is that without a proper realisation of the object and pur pose of the provision which seeks to. save the inherent powers of the High Court to do justice between the State and its. subjects, it would be impossible. to appreciate the width and contours of that salient jurisdiction. 118 Let us then turn to the facts of the case to see, wheth er the High Court was justified in holding that the proceed ings against the respondents ought to be quashed in order to prevent abuse of the process of the court and in order to secure the ends of justice. We asked the State counsel time and again to point out any data or material on the basis of which a reasonable likelihood of the respondents being convicted of any offence in connection with the attempted murder of the complainant could be predicated. A few bits here and a few bits there on which the prosecution proposes to rely are woefully inadequate for connecting the respond ents with the crime, howsoever, skilfully one may attempt to weave those bits into a presentable whole. There is no material on the record on which any tribunal could reason ably convict the respondents for any offence connected with the assault on the complainant. It is undisputed that the respondents were nowhere near the scene of offence at the time of the assault. What is alleged against them is, that they had conspired to commit that assault. This, we think, is one of those cases in which a charge of conspiracy is hit upon for the mere reason that evidence of direct involvement of the accused is lacking. we have been taken through the statements recorded by the police during the course of investigation and the other material. The worst that can be said against the respondents on the basis thereof is that they used to meet one another frequently after the dismissal of accused No. 1 and prior to the commission of the assault on the complainant. Why they met, what they said, and whether they held any deliberations at all, are matters on which no witness has said a word. In the circumstances, it would be a sheer waste of public time and money to permit the proceedings to continue against the respondents. The High Court was therefore justified in holding that for meeting the ends of justice the proceedings against the respondents ought to be quashed. Learned counsel for the State Government relies upon a decision of this Court in R.P. Kapur vs The State of Punjab (1) in which it was held that in the exercise of its inher ent jurisdiction under section 561A of the Code of 1898, the High Court cannot embark upon an enquiry as to whether the evi dence in the case is reliable or not. That may be so. But in the instant case the question is not whether any reli ance can be placed on the veracity of this or that particu lar witness. The fact of the matter is that there is no material on the record on the basis of which any tribunal could reasonably come to the conclusion that the respondents are in any manner connected with, the incident leading to the prosecution. Gajendragadkar, J., who spoke for the Court in Kapur 's(1) case observes in his judgment that it was not possible, desirable or expedient to lay down any inflexible rule which would govern the exercise of the High Court 's inherent jurisdiction. The three instances cited in the judgment as to when the High Court would be justified in exercising its inherent jurisdiction are only illustrative and can in the very nature of things not be regarded as exhaustive. Considerations justifying the exercise of inherent powers for securing the ends of justice naturally vary from case to (1) 119 case and a jurisdiction as wholesome as the one conferred by section 482 ought not to be encased within the strait jacket of a rigid formula. On the other hand, the decisions cited. by learned counsel for the respondents in Vadilal Panchaly. D.D. Gha digaonkar(1) and Cen tarS, Spinning & Manufacturing Co. vs State of Maharashtra(2) show that it is wrong to say that at the stage of flaming charges the court cannot apply. its judicial mind to the consideration whether or not there is any ground for presuming the commission of the offence by the accused. As observed in the latter case, the order framing a charge affects a person 's liberty substantially and therefore it is the duty of the court to consider judi cially whether the material warrants the framing of the charge. It cannot blindly accept the decision of the prose cution that the accused be. asked to face a trial. In Vadilal Panchal 's case. (supra) section 203 of the old Code was under consideration, which provided that the Magistrate could dismiss a complaint if after considering certain matters mentioned in the section there was in his judgment no sufficient ground for proceeding with the case. To art extent section 227 of the new Code contains an analogous power which is conferred on the Sessions Court. It was held by this Court, while considering the true scope of section 203 of the old Code that the Magistrate. was not bound to accept the result of an enquiry or investigation and that he must apply his judicial mind to the material on which he had to form his judgment. These decisions show that for ' the purpose of determining whether there is sufficient ground for proceeding against an accused the court possesses a comparatively wider discretion in the exercise of which. it can determine the question whether the material on the record, if unrebutted, is such on the: basis of which a conviction can be said reasonably to be possible. We are therefore in agreement with the view of the High Court that the material on which. the prosecution proposes.to rely against the respondents is wholly inade quate to. sustain the charge that they are in any manner connected with the assault on the complainant. We would, however, like to observe that nothing in our judgment or in the .judgment of the High Court should be taken as detract ing from the case of the prosecution, to. which we have not applied our mind, as against accused Nos. 1 to 9. The case against those accused must take its due and lawful course. The appeals are accordingly dismissed. S.R. Appeals dismissed. (1) A.I.R. 1969 S.C. 1113.

The apellants are accused Nos. 10, 13, 14, 15 and 17 to 20 before the Sessions Court for trial under various offences, viz., . 324, 326, and 307 read with section 34 of the Penal Code. While discharging accused Nos. 11, 12 and 16 u/s 227 of the Criminal Procedure Code 1973, on 8.8.1975, the learned Sessions Judge observed that there was "some materi al to hold that the remaining accused have had something to do with the incident which occurred on 6.12.1973 in I.T.I. Colony, Banglore" and adjourned the case to September 1, 1975, "for framing specific charges as made out from the material on record against the rest of the accused person . Two revision petitions were filed against this order, one by accussed Nos. 10, 13, 14 and 15 and the other by accused Nos. 17 to 20. These petitions were allowed by the High Court on the view that there was no sufficient ground for proceeding against the petitioners before it. The High Court accordingly quashed the the proceedings in regard to them. In appeal by Special Leave, the appellant State contended: (1) The High Court ought not to have exercised its power to quash the proceedings against the respondent without giving to the Sessions Court, which was seized of the case, an opportunity to consider whether there was sufficient material on the record on which to frame charges against the respondents. (ii) In any event the High Court could not take upon itself the task of assessing or appreci ating the weight of material on the record in order to find whether any charges could be legitimately framed against the respondents. Dismissing the appeal, the Court HELD: (1) The High Court was justified in holding that for meeting the ends of justice the proceedings against the respondents ought to be quashed. It would be a sheer waste of public time and money to permit the proceedings to continue against the respondent, when there is no material on the record on which any tribunal could reasonably convict them for any offence connected with the assault on the com plainant. This is one of these cases in which a charge of conspiracy is hit upon for the mere reason that evidence of direct involvement of the accused is lacking. [118 A, D E] (2) The saving of the High Court 's inherent powers, both in civil and criminal matters, is designed to achieve a Salutary public purpose which is that a Court proceedings ought not to be permitted to degenerate into a weapon of harassment or persecution. In a criminal case, the veiled object behind a lame prosecution, the very nature of the material on which the structure of the prosecution rests and the like would justify the High Court in quashing the pro ceeding in the interest of justice. [117 F G] (3) Considerations justifying the exercise of inherent powers for securing the ends of justice vary from case to case and a jurisdiction as wholesome as the one conferred by section 482 ought not to be encased within the strait jacket of a rigid formula. The three instances ' cited in the Judgment to when the High Court would be justified in exercising its inherent jurisdiction are only illustrative and can in the very nature of things not be regarded as exhaustive. [118 F H, 119 A] 114 R.P. Kapur vs State of Punjab explained. (4) It is wrong to say that at the stage of framing charges the Court cannot apply its judicial mind to the consideration whether or not there is any ground for presum ing the commission of the offence. [119 B] (5) While considering whether there is sufficient ground for proceeding against an accused. the court pos sesses a comparatively wider discretion in the exercise of which it can determine the question whether the material on the record. if unrebutted, is such on the basis of which a conviction can be said reasonably to be possible. [119 B E] Vadilal Panchal vs D. D. Ghadigaonkar ; ; Century Spinning & Manufacturing, Co. vs State of Maharashtra applied. (6) In the instant case the High Court is right in its view that the materials on which the prosecution proposed to rely against the respondents is wholly inadequate to sustain the charge that they are in any manner connected with the assault on the complainant. [119 E F] (7) The grievance that the High Court interfered with the Sessions ' Court 's order prematurely is not justified. The case was adjourned by the Sessions Judge not for deciding whether any charge at all could be framed against the remaining accused, but for the purpose of deciding as to which charge or charges could appropriately be framed on the basis of the material before him. [116 G H] (8) The object of section 227 of the Code of Criminal Procedure, Act 2 of 1974, is to enable the superior Court to examine the correctness of the reasons for which the Sessions Judge has held that there is not sufficient ground for proceed ing against the accused. [117 C D] (9) The High Court is entitled to go into the reasons given by the Sessions Judge in support of his order and to determine for itself whether the order is justified by the facts and circumstances of the case. [117 D E] . (10) In the exercise of the wholesome power u/s 482 of the Act 2 of 1974 (section 561 of 1898 Code), the High Court is entitled to quash a proceeding if it comes to the conclusion that allowing the proceeding to continue would be an abuse of the process of the Court or that the ends of justice require that the proceeding ought to be quashed. [117 E F] Observations: The ends of justice are higher than the ends of mere law though justice has got to be administered according to laws made by the legislature. Without a proper realisation of the object and purpose of the provision which seeks to save the inherent powers of the High Court to do justice between the State and its subjects, it would be impossible to appreciate the width and contours of that salient jurisdiction. [117 G H]

No. 208 of 1963Petition under article 32 of the Constitution of India for the en forcement of fundamental rights. B. D. Sharma, for the petitioner. S.V.Gupte, Additional Solicitor General, S.P. Varma and R. H. Dhebar, for the respondent. March 23, 1964. The Judgment of the Court was delivered by WANCHOO, J. This is a petition under article 32 of the Con stitution. The petitioner was appointed as a Telegraphist by the Post Master General Nagpur in 1949. In July 1960. he was serving as an officiating Teleprinter Supervisor at Jaipur. The employees of the Posts and Telegraphs Department (hereinafter referred to as the Department) went on strike from the midnight of July 11, 1960 throughout India and there was a similar strike at Jaipur. The petitioner was on duty on that day from 12 noon to 8 p.m. He says that after his duty was over, he did not go home but went to the dormitory where he fell asleep as he was tired. At about 11 30 p.m. he woke up on hearing some noise and discovered that it was very late and then he wanted to go home. But as he came out, he was arrested by the police on the ground that he was also one of the demonstrators, who were demonstrating outside in connection with the strike. The arrest was made under the Essential Services Maintenance Ordinance, No. 1 of 1960, (hereinafter referred to as the Ordinance). 'On July 13, the petitioner was suspended on the ground that a criminal charge was pending against him in a criminal court. 405 However, the criminal charge was withdrawn on July 18, 1960. On July 21, 1960, a charge sheet was served on the petitioner in the following terms: "That Shri Radhey Shyam Sharma I C/S Telegraphist, CTO Jaipur committed gross misconduct in that on the midnight of the 11th July 1960, he took part in a demonstration in furtherance of the strike of the P. & T. Employees in violation of the orders dated 8 7 1960 issued by the Government of India under the "Essential Services Maintenance Ordinance, 1960 (1 of 1960)" prohibiting strike in any postal, telegraph or telephone Service." An inquiry was made in the matter by the Post Master Gene ral, Central Services Nagpur to whom it was transferred as the petitioner had been appointed by that officer. The enquiry officer found the petitioner guilty of the charge framed against him and thereupon a notice was issued to him to show cause why the penalty of reduction in the time scale by three stages for a period of two years affecting the future increments be not imposed upon him. Thereafter the Post Master General after taking into account the explanation submitted by the petitioner to the show cause notice ordered that the pay of the petitioner should be reduced in the time scale by three stages for a period of two years and on restoration the period of reduction was not to operate to postpone his future increments. Thereupon the petitioner filed an appeal to the Director General, Posts and Telegraphs. The Director General directed further evi dence to be taken on certain lines before deciding the appeal. However, no further evidence was given on behalf of the Department and the matter was re submitted to the Director General as it was Finally, the Director General considered the whole matter on the merits and rejected the appeal. The present petition is a sequel to the order of the Director General, and the petitioner contends that the punishment imposed upon him is violative of his fundamental rights under articles 19(1)(a) and 19 (1) (b) and should be quashed. Reliance is placed on his behalf on two cases of this Court in Kameshwar Prasad vs State of Bihar,(1) and O. K. Ghosh vs E. X. Joseph(2), Further it is contended that sections 3, 4 and 5 of the Ordinance are ultra vires, as they contravene sub clauses (a) and (b) of article 19 (1). Lastly, it is urged that in any case there was no evidence on which it could be found that the charge against the petitioner had been proved. (1) [1962] Supp. 3 S.C.R. 369. (2) [1963]. Supp. 1 S.C.R. 789. 406 The petition has been opposed on behalf of the Union of India and it is urged that the Ordinance is perfectly constitutional and does not violate any fundamental rights. It is further urged that the two cases relied upon by the petitioner are of no assistance to him, as they were concerned with R.4 A and Rule 4 B of the Central Civil Services (Conduct) Rules, 1955. Lastly it is urged that there was evidence on which the authorities concerned could find the charge proved against the petitioner. The first question that arises is whether ss.3, 4 and 5 of the Ordinance are violative of any fundamental rights en shrined in the Constitution. The Ordinance as its name shows was passed in order that essential services may be maintained. Its necessity had arisen because of a threat of strike inter alia by the employees of the Department. Among "Essential Service" as defined in section 2 (1) is included the postal, telegraph or telephone service. Section 3 of the Ordinance provides that "if the Central Government is satisfied that in the public interest it is necessary or expedient so to do, it may, by general or special order, prohibit strikes in any essential service specified in the Order". Further upon the issue of such an order no person employed in any essential service to which the order relates shall go or remain on strike; and any strike declared or commenced, whether before or after the issue of the order, by persons employed in any such service, shall be illegal. Section 4 provides that any person who commences a strike which is illegal under the Ordinance or goes or remains on or otherwise takes part in, any such strike shall be punished with imprisonment. Section 5 provides that any person who instigates, or incites other persons to take part in, or otherwise acts in furtherance of, a strike which is illegal under the Ordinance shall be punishable with imprisonment. The constitutionality of these sections is attacked on the ground that they violate the fundamental rights guaranteed by cls. (a) and (b) of article 19 (1). Under cl. (1) (a) all citizens have the fundamental right to freedom of speech and expression and under cl. (1) (b) to assemble peaceably and without arms. Reasonable restrictions on these fundamental rights can be placed under the conditions provided in cls. (2) and (3) of article 19. We are of opinion that there is no force in the contentiton that these provisions of the Ordinance violate the fundamental rights enshrined in sub cls. (a) and (b) of article 19(1). A perusal of article 19(1) shows that there is no fundamental right to strike, and all that the Ordinance provides is with respect to any illegal strike as provided in the Ordinance. This aspect has been elaborately discussed in the Bank Employees ' case(1) and it has been held that there is no fundamental right to strike (1) ; 407 (see All India Bank Employees ' Association V. National Industrial Tribunal(1)). There is no provision in the Ordinance which in any way restricts freedom of speech and expression, nor is there any provision therein which restricts any one from assembling peaceably and without arms. The Ordinance thus has nothing to do with restricting the fundamental rights enshrined in sub cls. (a) and (b) of article 19(1), and there is therefore no necessity of even considering whether the provisions of the Ordinance can be justified under cls. (2) and (3) of article 19. It is not disputed that Parliament had the competence to make a law in the terms of the Ordinance and therefore the President had also the power to promulgate such an Ordinance. The competence of the legislature therefore being not in dispute we fail to see how the Ordinance can violate the fundamental rights guaranteed under sub cls (a) and (b) of article 19(1) for there is no provision in it which in any way restricts those fundamental rights. Learned counsel for the petitioner in this connection relies on two cases of this Court to which reference has already been made. Kameshwar Prasad 's case (2) related to R. 4 A of the Bihar Government Servants ' Conduct Rules, 1956, which provided that no government servant shall participate in any demonstration or resort to any form of strike in connection with any matter pertaining to his conditions of service. This Court held in that case that R 4 A insofar as it prohibited any form of demonstration, be it however innocent or however incapable of causing a breach of public tranquility was violative of articles 19(1) (a) and 19(1) (b) of the Constitution. This Court also held that insofar as that rule prohibited a strike it was good, since there was no fundamental right to resort to strike. In O. K. Ghosh 's case(3) this Court was concerned with r. 4 A and r. 4 B of the Central Civil Services (Conduct) Rules, 1955, and following the decision in Kameshwar Prasad 's case(4), 4 A was struck down in part so far as it related to demonstrations and r. 4 B was also held to be invalid. That case did not deal with the Ordinance at all and the charge in that case did not seem to have been in the same terms as the charge in the present case. No argument appears to have been urged either in the High Court or before this Court about the validity of the Ordinance or about the validity of the impugned order in relation to the Ordinance or the illegal character of the strike. In the circumstances that case is also of no assistance to the petitioner and there was nothing decided there which would in any way affect the validity of the provisions of the Ordinance. We are therefore of opinion that the Ordinance is valid. (1) ; , 292.(2) (2) [1962] Supp. 3 S.C.R. 369. (3) [1963] Supp. 1 S.C.R. 789. 408 We have already set out the charge framed against the petitioner. it will be seen that the charge is based entirely on the Ordinance and has no connection with rr. 4 A and 4 B which were considered in the O.K. Ghosh 's case(1). The petitioner is charged with gross misconduct on the ground that on the midnight of July 11, 1960, he took part in a demonstration in furtherance of the strike of the employees of the Department in violation of the order of July 8, 1960. It is not disputed that on July 8, 1960, the Central Government had issued an order under section 3 of the Ordinance prohibiting any strike in the Department. The strike therefore that started on the midnight of July 11, 1960 was an illegal strike in view of section 3 (4)(b) of the Ordinance. Section 5 of the Ordinance provides inter alia that any person who acts in furtherance of a strike which is illegal is punishable thereunder. The charge against the petitioner was that he had acted in furtherance of the strike which was to commence on the midnight of July 11, 1960 and was therefore guilty of gross misconduct. It is this charge of gross misconduct which has been found to be proved against the petitioner and which has led to the punishment inflicted on him. This charge as already indicated has nothing to do with r. 4 A and r. 4 B and therefore the two cases on which the petitioner relies have no relevance in connection with this charge. The punishment given to the petitioner cannot therefore be set aside on the ground that the charge was in violation of the fundamental rights guaranteed under sub cls. (a) and (b) of article 19(1), which deal with freedom of speech and expression and the right to assemble peaceably and without arms. The charge does not deal with these two matters at all. On the other hand it deals with acting in furtherance of the illegal strike which started on the midnight of July 11, 1960, and the petitioner was charged with gross misconduct inasmuch as he acted in furtherance of the illegal strike on July 11, 1960 after the strike had been prohibited by the Central Government by order dated July 8, 1962. Whether the "acting" in furtherance of the strike took the form of speeches or demonstrations would make no difference. In either case it can be said that there is a violation of article 19 (1) (a). The only question that remains for consideration therefore is whether the petitioner 's contention that there was no evidence at all on which the authorities concerned could find the petitioner guilty of the charge is correct. So far as that is concerned, the authorities had the following undisputed facts before them: (1) The petitioner was the Secretary of the local union of the employees of the Department; (1) [1963] Supp. 1 S.C.R. 789. 409 (2) On that day the petitioner 's duty finished at 8 p.m. and he should have normally gone home; but he stayed on in the dormitory till 11 30 p.m. which was just half an hour before the strike was to commence; (3) The demonstration was held in connection with the strike by the employees of the Department at 11 30 p.m. just half an hour before the strike was to commence; (4) The petitioner took part in that demonstration and was actually arrested amongst the demonstrators. If on these undisputed facts the authorities came to the conclusion that the petitioner acted in furtherance of the strike which was to commence half an hour later and was thus guilty of gross misconduct it cannot in our opinion be said that there was no evidence on which the authorities concerned could find the charge framed against the petitioner proved. The contention therefore that there was no evidence on which the authorities concerned could find the charge proved must fail. We therefore dismiss the petition. In the circumstances ,of this case we pass no order as to costs. Petition dismissed.

The petitioner was serving as an officiating Teleprinter Supervisor at Jaipur when the employees of the Posts and Telegraphs Department went on strike from the midnight of July 11, 1960, throughout India and there was a similar strike at Jaipur. The petitioner 's case was that he was on duty that day from 12 noon to 8 p.m. and after his duty was over, he did not go home but went to the dormitory where he fell asleep as he was tired. On hearing some noise he woke up at 11 30 p.m. and wanted to go home but was arrested by the police under the Essential Services Maintenance Ordinance, No. 1 of 1960. The criminal charge was however withdrawn. On July 21, 1960, a chargesheet was served on the petitioner in the following terms: "That Shri Radhey Shyam Sharma I C/S Telegraphist, CTO Jaipur committed gross misconduct in that on the midnight of the 11th July, 1960, he took part in a demonstration in furtherance of the strike of the P. & T. Employees in violation of the orders dated 8 7 1960 issued by the Government of India under the 'Essential Services Maintenance Ordinance, 1960 (1 of 1960) ' prohibiting strikes in any Postal, telegraph or telephone service". The enquiry officer found him guilty of the charge and ordered that his pay should be reduced in the time scale by three stage,% for a period of two years and on restoration the period of reduction was not to operate to postpone his future increments. 0n appeal, the Director General considered the whole matter on merits and rejected the appeal. In this Court it was urged that the punishment imposed upon the petitioner was violative of his fundamental rights under articles 19(1)(a) and (b), reliance being placed on two cases of this court in Kameshwar Prasad vs State of Bihar and O. K. Ghosh vs E. X. Joseph; that sections 3, 4 and 5 of the Ordinance were ultra vires, as they contravened article 19(1.)(a) and (b) and that in any case there was no evidence on which it could ' be found that the charge against him had been proved. Held: The provisions of the Ordinance in sections 3, 4 and 5 did not violate the fundamental rights enshrined in article 19(1)(a) and (b). A perusal of article 19(1) shows that there is no fundamental right to strike, and all that the ordinance provided was with respect to any illegal strike as provided in the Ordinance. There was no provision in the Ordinance which in any way restricted those fundamental rights. It was not in dispute that Parliament had the competence to make a law in the terms of the Ordinance and therefore the President had also the power to promulgate, such an Ordinance. 404 The competence of the legislature therefore being not in dispute it cannot be held that the Ordinance violated the fundamental rights guaranteed under article 19(1)(a) and (b). All India Bank Employees Association vs National Industrial Tribunal, ; , referred to. The two cases relied on by the petitioner have no relevance in connection with the charge in the present case. The punishment given to the petitioner cannot therefore be set aside on the ground that the charge was in violation of the fundamental rights guaranteed under article 19(1)(a) and (b). Kameshwar Prasad vs State of Bihar, [1962] Supp. 3 S.C.R. 369 and O. K. Ghosh vs E. X. Joseph, [1963] Supp. 1 S.C.R. 789, held inapplicable. If on the undisputed facts the authorities came to the con clusion that the petitioner acted in furtherance of the strike 'Which was to commence half an hour later and was thus guilty of gross misconduct, it could not be said that there was no evidence on which the authorities concerned could find the charge framed against the petititoner proved.

vil Appeals Nos. 893 to 892 and 1381 to 1386 of 1966. Appeals from the judgment and order dated December 7, 1962 of the Andhra Pradesh High Court in Case Referred No. 24 of 1956. D. Narsaraju, P. Ramrao, K.R. Chaudhuri and K. Rajendra Chaudhuri, for the appellants (in C.As. Nos. 893 to. 898 of 1966) and the respondents (in C.As. 1281 to 1386 of 1966). Jagdish Swarup, Solicitor General, S.K. Aiyar and R.N. Sachthey, for the respondent (in C.As. Nos. 893 to 898 of 1966) and ' the appellant (in C.As. 1381 to 1386 of 1966). The Judgment of the Court was delivered by Ramaswami, J. The assessee who Is the Kartha of a Hindu Undivided Family was assessed in that status for the relevant assessment years, 1944 45, 1945 46, 1946 47 not only to incometax but also to excess profits tax. On February 1, 1941 he purchased from Randhi Appalaswamy (hereinafter referred to as the vendor) a spinning mill known. as Sri Satyanarayana Spinning 728 Mills, Rajahmundry for a sum of Rs. 54,731. The purchase was made at a period when there was litigation between the sons of the vendor and the vendor in respect of the spinning mill and other properties. The sons had filed a suit against the father, the vendor, claiming the schedule properties including the mill as joint family properties and for partition of the same. The vendor claimed that the properties were his self acquired properties. The District Judge, Rajahmundry held that the properties were the self acquired properties of the vendor and dismissed the suit of the plaintiffs. Against the judgment of the District Judge an appeal was filed in the Madras High Court, being A.S. No. 175 of 1938. While the appeal was pending, on February 1, 1941 the assessee purchased the mill from the vendor who purported to sell the same as the sole owner. In A.S. No. 175 of 1938 the Madras High Court held that the properties of the vendor were not his self acquired properties but were joint family properties in which the plaintiffs had a two thirds share. Against this judgment the vendor preferred an appeal to the Privy Council. While that appeal was pending the assessee had submitted returns for the relevant assessment years. However, before the assessments were taken up the assessee entered into a compromise with the plaintiffs on September 7, 194S by virtue of which he got a release of the interest of the vendor 's sons on payment of Rs. 1,15,000. While the appeal was pending before the Privy Council the plaintiffs had applied to the High Court for recovery of their share of the profits. The High Court appointed the assessee as the Receiver directing him to deposit the profits in the High Court. The assessee deposited a sum of Rs. 1,09,613 for the year 1944 45, Rs. 31,087 for the year 1945 46 and Rs. 4,775 for the year 1946 47. Under the compromise the assessee was entitled to withdraw these amounts on payment of Rs. 1,15,000. The Privy Council decided the appeal on July 2, 1947 reversing the order of the High Court and restoring that of the District Judge holding that Appalaswamy was the absolute owner of the mill and the sons had no right, title or interest therein. On receipt of the Privy Council 's decision which finally determined the rights of the parties and the ownership of the assessee in the mill, the Income tax Officer issued on March 2, 1948 a notice under section 34 of the Income tax Act in respect of Rs. 1,09,613 received by the assessee as lease income of the mill. It was contended for the assessee (1 ) that the proceedings initiated under section 34 of the Act for the year 1944 45 assessment were invalid in law as there was no new information leading to the discovery that income had escaped assessment, (2 ') that in any event the assessee was entitled to set off the sum of Rs. 1,15,000 paid to the sons of Appalaswamy under the compromise approved by the High Court for releasing their rights. if any, in the mill against the assessee 's income from the mill. The 729 Income tax Officer rejected these contentions and treated the whole amount of Rs. 1,15,000 as paid toward capital expenditure in acquiring an asset. The Appellate Assistant Commissioner rejected the appeal of the assessee. The Tribunal affirmed the order of the Appellate Assistant Commissioner. It held in the first place that the assessee had not disclosed the impugned source of income from the mill in his original assessment, that the matter as to the assessee 's ownership of the mill was sub judice and that the decision of the Privy Council constituted information not only of law but also as to the factum of the ownership of the Mill and the income therefrom. The Tribunal expressed the view that the sum of Rs. 1,15,000 could not be allowed to be set off against the assessee 's income from the mill as it was an ex gratia payment to the sons of Appalaswamy who had no right, title or interest in the mill and it was paid in order to perfect a supposed defective title and as such was of capital nature. Thereafter the Income tax Appellate Tribunal stated a case to the High Court under section 66(2) of the Indian Income tax Act, 1922 on the following questions of law: "R. A. NO. 779 which relates to the assessment year 1944 45: (1) Whether on the facts and in the circumstances of the case, in respect of the assessment year 1944 45, the assessment made on the assessee in the status of a Hindu undivided family in respect of income received by him as Receiver could be justified notwithstanding the provisions of section 41 of the Act ? (2) Whether, on the facts and in the circumstances of the case, the assessment of the entire income of Rs. 1,09,613 in the hands of the assessee is valid in the face of the compromise memo, dated 7 9 1945 approved by the Court? (3) Whether, on the facts and in the circumstances of the case, the assessee is not entitled to set off Rs. 1,15,000 being the amount paid to the minors for releasing their fights in the property from out of the amount received from the mill ? R.A. No. 780 which relates to assessment year 1945 46: (1) Whether on the facts and in the circumstances of the case, the assessment made under section 34 of the Act is valid in law ? (2) Whether on the facts and in the circumstances of the case, in respect of the assessment year 1945 46, 730 the assessment on the assessee in the status of a Hindu undivided family in respect of the income received by him as Receiver could be justified notwithstanding the provisions of Section 41 of the Act ? (3) Whether, on the facts and in the circumstances of the case, the assessment of the entire income of Rs. 31,087 in the hands of the assessee is valid in the face of the compromise memo, dated 7 9 1945 approved by the Court ? (4) Whether, on the facts and in the circumstances of the case, the assessee is not entitled to set off Rs. 1,15,000 being the amount paid to the minors for releasing their rights in the property from out of the amount received from the mill ? R.A. No. 781 which relates to assessment year 1946 47: (1) Whether, on the facts and in the circumstances of the case, in respect of the assessment year 1946 47 the assessment on the assessee in the status of a Hindu undivided family in respect of income received by him as Receiver could be justified, notwithstanding the provisions of section 41 of the Act ? (2) Whether, on the facts and in the circumstances of the case, the assessment of the entire income of Rs. 4,775 in the hands of the assessee is valid in the face of the compromise memo, dated 7 9 1945 approved by the Court ? (3) Whether on the facts and in the circumstances of the case, the assessee is not entitled to set off Rs. 1,15,000 being the amount paid to the minors for releasing their right in the property from out of the amount received from the Mill ?; ' The Appellate Tribunal pointed out in the statement of the case that question No. 1 in R.A. No. 780 for the assessment year 1945 46 pertained to the earlier assessment year 1944 45 in R.A. No. 779 and also that question No. 2 in R.A. No. 780 and R.A. No. 779 for the assessment year 1945 46 and the corresponding excess profits tax assessment did not arise in that year but pertained to the earlier assessment year 1944 45 in R.A. No. 779 and the corresponding excess profits tax assessment in R.A. No. 782. The High Court answered question Nos. 1 and 2 in R.A. No. 779 and question No. 1 in R.A. No. 780 in the affirmative. 731 The High Court held that re assessment proceedings have been validly initiated under section 34 of the Act. The High Court found that the assessment on the assessee in the status of Hindu Undivided Family in respect of income received by him as Receiver was proper. The High Court thought that the basis of the compromise in the Madras High Court entered into between the assessee and the minor sons of the vendor Appalaswamy wherein the assessee paid Rs. 1,15,000 to the minor sons cannot be ignored. The High Court negatived the contention of the Income tax Department that the sum of Rs. 1,15,000 was paid to cure a supposed defect in the title and that it was a capital payment. Upon the interpretation of the terms of the compromise the High Court took the view that the amount of Rs. 1,15,000 was paid partly towards acquisition of capital asset and partly towards the discharge of the claim towards profits and hence it should be apportioned towards capital and income in the proportion of 90/85. 1381 to 1386 of 1966 are brought by certificate from the judgment of the High Court on behalf of the Commissioner of Income tax and C.A. Nos. 893 to 898 of 1966 were brought by special leave from the same judgment to this Court on behalf of the assessee. After the Amending Act of 1939 and before the Amending Act of 1948 Section 34 stood as follows: "(1) If in consequence of definite information which has come into his possession the Income tax Officer, discovers that income, profits or gains chargeable to income tax have escaped assessment in any year, or have been under assessed, or have been assessed at too low a rate, or have been the subject of excessive relief under this Act the Income tax Officer may in any ease in which he has reason to believe that the assessee has concealed the particulars of his income or deliberately furnished inaccurate particulars thereof at any time within eight years, and in any other case at any time within four years of the end of that year, serve on the person liable to pay tax on such income profits or gains or in the case of a company on the principal officer thereof a notice containing all or any of the requirements which may be included in a notice under sub section (2) of section 22, and may proceed to assess or re assess such income, profit or gains, and the provisions of this Act, shall. so far as tony be, apply accordingly as if the notice were a notice issued under that sub section. . . . . . (2) No order of assessment under section 23 or of assessment or re assessment under sub section (1) of this 732 section shall be made after the expiry, in any case to which clause (c) of sub section (1) of section 28 applies, of eight years, and in any other case, of four years from the end of the year, in which the income, profits or gains were first assessable. The first question arising in this case is whether the proceeding under section 34 is legally valid. It was contended by Mr. Narasaraju that the decision of the Privy Council could not be said to be definite information within the meaning of the section. It was said that the Income tax Officer was fully aware of the circumstances of the case and the assessee had placed all the relevant facts before him namely that under the High ' Court 's judgment the vendor was only entitled to one third share of the income pending the decision of the appeal before the Privy Council. In our opinion there is no justification for tiffs argument. It is not true to say that the assessee brought all the relevant facts before the Income tax Officer. On the Contrary he deliberately suppressed the fact that there was a compromise between himself and the plaintiffs under which he was entitled to the whole of the income from the mill. At any rate the Privy Council 's decision which determined the rights of the parties irrespective of the compromise did constitute definite information within the meaning of section 34 of the Income tax Act. This view is borne out by the decision of this Court in Maharaja Kumar Kamal Singh vs Commissioner of Income tax. (1) In that case the Income tax Officer had, following the decision of the High Court in Kamakhya Narain Singh 's case(" ') omitted to bring to assessment for the year 1945 46 the sum of Rs. 93,604 representing interest on arrears of rent due to the assessee in respect of agricultural land on the ground that the amount was agricultural income. Subsequently the Privy Council, on appeal from that decision held that interest on arrears of rent payable in respect of agricultural land was not agricultural income. As a result of this decision the Income tax Officer initiated re assessment proceedings under section 34(1)(d) of the Income tax Act and brought the amount of Rs. 93,604 to tax. In these circumstances it was held by this Court firstly that the word information in section 34(1)(b) included information as to the true and correct state of the law, and so would cover information as to relevant judicial decisions, secondly that 'escape ' in section 34(1) was not confined to cases where no return had been submitted by the assessee or where income had not been assessed owing to inadvertence or oversight or other lacuna attributable to the assessing authorities. But even in a case where a return had been (1) (2) 733 submitted, if the Income tax Officer had erroneously failed to tax a part of the assessable income, it was a case where that part of the income had escaped assessment. The decision of the Privy Council, therefore, was held to be information within the meaning of section 34( 1 ) (b) and the proceedings for re assessment were validly initiated. In our opinion the principle of this decision governs the present case and it must be held that the proceedings initiated under section 34 for the assessment year 1944 45were legally valid. It was stated on behalf of the appellant that in any case the income tax Officer could have legitimately assessed one third share of the income which was due to the assessee according to the judgment of the Madras High Court and there was escape only to the extent of two third share of the income. This argument is not of much avail to the appellant because once proceedings under s.34 are taken to be validly initiated with regard to two third share of the income, the jurisdiction of the Income tax Officer cannot be confined only to that portion of the income. Section 34 in terms states that once the Income tax Officer decides to reopen the assessment he could do so within the period prescribed ' by serving on the person liable to pay tax a notice containing all or any of the requirements which may be included in a notice under section 22(2) and may proceed to assess or re assess such income, profits or gains. It is, therefore, manifest that once assessment is reopened by issuing a notice under sub section (2) of section 22 the previous under assessment is set aside. and the whole assessment proceedings start afresh. When once valid proceedings are started under section 34(1)(b) the Income tax Officer had not only the jurisdiction but it was his duty to levy tax on the entire income that had escaped assessment during that year. The second question involved in this case is whether the High Court was right in holding that any portion of the amount of Rs. 1,15,000 was liable to be treated as business expenditure. It is well established that where money is paid to perfect a title or as consideration for getting rid of a defect in the title or a threat of litigation the payment would be capital payment and not revenue payment. What is essential to be seen is whether the amount of Rs. 1,15,000 was paid for bringing into existence a right or asset of an enduring nature. In other words if the asset which is acquired is in its character a capital asset, then any sum paid to acquire it must surely be capital outlay. Money paid in consideration of the acquisition of a source of profit or ' income is capital expenditure both on principle and authority. In Atherton vs British Insulated and Helsby Cables Ltd.(1) Viscount Cave said: "But where an expenditure is made, not only once for all, but with a view to bringing into existence an (1) , 213. 734 asset or an advantage for the enduring benefit of a trade, I think that there is very good reason (in the absence of special circumstances leading to an opposite conclusion) for treating such an expenditure as properly attributable not to revenue but to capital. " In Commissioner of Taxes vs Nchanga Consolidated Copper Mines Ltd.(1) Lord Radcliffe observed at p. 960: "Courts have stressed the importance of observing a demarcation between the cost of creating, acquiring or enlarging the permanent (which does not mean perpetual) structure of which the income is to be the produce or fruit and the cost of earning that income itself or performing the income earning operations. Probably this is as illuminating a line of distinction as the law by itself is likely to achieve. " It is, however, contended on behalf of the assessee that the amount of Rs. 1,15,000 was paid partly for the acquisition of capital asset and partly to discharge the claim towards profits and hence there should be an apportionment of , '.he amount. It is not possible to accept this contention. It appears from the order of the High Court that the value of the mill was fixed at Rs. 1,15,000 after taking into consideration the fact that the mill was built on a leasehold premises. The value of the machinery was fixed at Rs. 1,36,000 and the leasehold interest was fixed at Rs. 14,000. On this basis the share of the minors was taken to be Rs. 90,000. In respect of the profits the claim of the plaintiffs was taken to be Rs. 85,000. The total claim was therefore Rs. 1,75,000 so that the offer of Rs. 1,15,000 for the release of the claim of the plaintiffs in the mill was held to be .fair. The High Court. therefore, certified the compromise to be for the benefit of the minor plaintiffs. In the course of its order, dated September 7, 1945 the High Court observed: "There are, however, numerous risks which the continuance of the litigation would necessarily involve. The Privy Council might hold that the null was the selfacquired property of the father, in which case the plaintiffs would get nothing and would incur a liability for costs. It might also be held that, though the property was the family property, the father was entitled as the natural guardian to sell the interests of minor sons in discharge of a binding family obligation. There is the further possibility that by the time the litigation ends the property will have deteriorated and its value will have (1) 735 been materially reduced. by the termination of the lease of the land. Taking all these contingencies into consideration we are of opinion that the offer made by the purchaser of Rs. 1,15,000 for the release of the claim, if any, of the two sons in the mill sold to him by their father is a fair offer, the acceptance of which would be beneficial to the minor second plaintiff. " It is true that the High Court took into consideration the income from the mill in testing whether the offer made by the purchaser of Rs. 1,15,000 for the release of the Claim of the plaintiffs was a fair offer. But that does not mean that the sons of Appalaswamy were given as a result of the compromise a share in the profits of the assessee. It is clear from the circumstances of this case that the payment of Rs. 1,15,000 was made by the assessee in order to perfect his title to capital asset and the assessee is not entitled to set off any portion of the amount as attributable to the lease money. It was a lump sum payment for acquisition of a capital asset and the claim of the plaintiffs for the lease money from the property was merely ancillary or incidental to the claim to the capital asset. In our opinion the High Court was in error in holding that the amount should be apportioned between capital and income. In the result so far as questions 3 and 4 in R.A. 779, questions 1 and 2 in R.A. 780 and questions 2 and 3 in R.A. 781 are concerned the answer is that the entire amount of Rs. 1,15,000 should be treated as capital payment and the assessee is not entiled to exclude from the income sought to be assessed in his hands any portion of that amount. We accordingly allow C.A. Nos. 1381 to 1386 of 1966 to the extent indicated above. C.A. Nos. 893 to 898 of 1966 are dismissed. There will be no order as to costs in either of two sets of appeals. C.A. Nos. 1381 to 1386/66 allowed. C.A. Nos. 893 to 898/66 dismissed.

The assessee purchased a spinning mill in 1941 from a vendor claiming to be its sole proprietor. In a suit filed by the vendor 's sons the trial court had held that the suit property including the aforesaid spinning mill was the vendor 's self acquired property. When the assessee purchased the mill an appeal against the trial court 's judgment was pending in the High Court 'the High Court decided that the property was not the self acquired property of the vendor but was coparcenary property in which the sons had two thirds interest. The vendor filed an appeal before the Privy Council. During its pendency the assessee entered into a compromise with the vendor 's sons whereby they agreed to release their two thirds interest in the mill and its profits for a sum of Rs. 1.15,000. The compromise was certified by the High Court. In 1947 the Privy Council decided that the property including the spinning mill was the self acquired property of the vendor. On receipt of this decision which finally determined the rights of the parties and assessee 's ownership of the mill, the Income tax Officer issued a notice under section 34 of the Indian income tax Act, 1922 for the assessment year 1944 45 and assessed the income from the mill for that year and for the two subsequent assessment years in the hands of the assessee. The assessee 's objection that the decision of the Privy Council was not 'definite information ' within the meaning of section 34 was rejected as also the assessee 's claim that the sum of Rs. 1,15,000 paid to the vendor 's sons in pursuance of the compromise should be set off as an expense against the income from the mill for the year in question. The Appellate Assistant Commissioner and the Tribunal upheld the Income tax Officer 's order. The High Court in reference held that the notice under section 34 was valid but that the payment of Rs. 1,15,000 was made partly towards acquisition of a capital asset and partly towards the discharge of the claim for profits and the part apportionable towards the profits was allowable as revenue expenditure. The assessee as well as the Revenue appealed to this Court. HELD: (i) In Maharaja Kumar Kamal Singh 's case this Court held that the word information section 34(1)(b) included information as to the true and correct state of the law, and so would cover information as to relevant judicial decisions. It was further held that even in a case where a return had been submitted, if the Income tax Officer had erroneously failed to tax a part of the assessable income, it was a case when that part of the income had escaped assessment. The decision of the Privy Council was therefore held to be information within the meaning of section 34(1)(b). The principle laid down in Maharaja Kumar Kamal Singh 's case governed the present case and it must be held that the proceedings initiated under section 34 for the assessment year 1944 45 were legally valid. [732 G 733 B] 727 Maharaja Kumar Kamal Singh vs Commissioner of Income tax, , followed and applied. Kamakhya Narain Singh 's case, , referred to. The contention that only two thirds of the income could be said to h,rye escaped assessment because the one third share of the vendor could have been validly assessed the Income tax Officer on the basis of the High Court 's judgment, could not be accepted. When once valid proceedings are started under section 34(1)(b) read with section 22(2) the previous under assessment is set aside and the whole assessment proceedings start afresh. The Income tax Officer then has not only the jurisdiction but the duty to levy tax on the entire income that has escaped assessment in that year. [733 C E] It is well established that where money is paid to perfect a title or as consideration 'for getting rid of a defect in title or a threat of litigation the payment would be a capital payment and not a revenue payment. Money paid in consideration of the acquisition of a source of profit or income is capital expenditure both on principle and authority. [733 F G] Atherton vs British Insulated awl Helsby Cables Ltd. , 213 and Commissioner of Taxes vs Nchanga Consolidated Copper Mines Ltd. , referred to. It was true that in the present case the High Court took into consideration income from the mill in testing whether the offer made by the purchaser of Rs. 1,15,000 for the release of the claim of the plaintiffs v, as a fair offer. But that did not mean that the sons of the vendor were given as a result of the compromise a share in the profits of the assessee. It was clear from the circumstances of the case that the payment was made by the assessee in order to perfect his title to a capital asset, and no portion of it could therefore could be set off against the profit. [735 C]

Appeals Nos. 653 to 655 of 1964. Appeals from the judgment and decree dated November 1, 1962 of the Allahabad High Court in Special Appeals Nos. 267 and 292 of 1957. C. K. Daphtary, Attorney General, Shanti Bhushan, AdvocateGeneral, U.P. and 0. P. Rana, for the appellants (in C.As. Nos. 653 and 654 of 1964) and the respondents (in C.A. No. 655 of 1964). A. K. Sen, B. R. L. Iyengar, V. P. Misra, section K. Mehta and K.L. Mehta, for the respondent (in C.As. Nos. 653 and 654 of 1964) and the appellant (in C. A. No. 655 of 1964). 363 The Judgment of the Court was delivered by Sikri, J. These appeals by certificates granted by the High Court of Judicature at Allahabad raise one principal question: Whether the amendment of the definition of the word "estate" in clause (8) of section 3 of the Uttar Pradesh Zamindari Abolition and Land Reforms Act, 1950 (hereinafter referred to as the Reforms Act) made by section 2 of the Uttar Pradesh Zamindari Abolition and Land Reforms (Amendment) Act, 1963, hereinafter called the impugned Act, is within the definition of the word "estate" in article 31A(2) of the Constitution? These appeals arise out of a petition filed by Raja Anand Brahma Shah of Agori Barhar Raj under article 226 of the Constitution. The State of Uttar Pradesh had issued a notification No. 3549/1/A 499 dated June 30 1953, extending the provisions of Reforms Act, 1950, to apply to the areas to the South of Kaimur Range. It then issued another notification No. 3949/(1) A 4991949 dated July 1953, directing the vesting of all "estates" situated to the south of Kaimur including the Pargana Agori, owned by the petitioner. The Pargana Agori is comprised of 123 villages. At the time the petition was filed and the judgment of the Single Judge, dated November 8, 1957, was delivered, section 3(8) of the Reforms Act stood as follows . " 'Estate ' means the area included under an entry in any of the registers prepared and maintained under clause (a), (b), (c) or (d) of section 32 of the United Provinces Land Revenue Act, 1901, or in the registers maintained under clause (e) of the said section in so far as it relates to a permanent tenure holder and includes share in or of an estate. " The case of the petitioner in short was that Pargana Agor was not an estate within section 3(8) of the Reforms Act because nor ecords were prepared and maintained under the provisions of section 32 of the Land Revenue Act, 1901, in respect of Pargana Agori, and the records alleged to have been prepared between 1840 to 1843 under the Bengal Regulations were unauthorised and the Government itself did not approve these records at any time. The learned Single Judge, keeping in view the definition in section 3(8) of the Reforms Act, came to the conclusion that the whole of 81 villages, including the cultivated. area, the forest, the hill and everything else would vest in the State of Uttar Pradesh. He held that the Raja 's name alone was entered in the khewats of 64 villages, and in the khewats of 17 villages although the names of under proprietors were written, the Raja was the proprietor of the entire villages because the Raja 's name was mentioned as "Malik Ala". With respect to the remaining 42 villages he held that only the areas mentioned in the khewats of the different villages and not the forests and hills attached to them Sup. C.I/66 10 364 fell within section 3(8). In the result he allowed the petition in part and issued a writ of mandamus directing the respondents not to take possession nor to interfere with the possession of the petitioner over the hills and jungle appertaining to the said 42 villages as distinguished from the areas mentioned in the khewats of these villages at the time the vesting order was issued. He dismissed the rest of the claim. The petitioner and the State of Uttar Pradesh both filed appeals, the petitioner claiming that the petition should be allowed in entirety, the State claiming that the petition should be dismissed. During the pendency of the appeals (U. P. Act XIV of 1958) substituted the following new section 3(8) in the Reforms Act, with retrospective effect from July, 1952: "3(8) "Estate" means and shall be deemed to have always meant the area under one entry in any of the registers described in clause (a), (b), (c) or (d) and, in so far as, it relates to a permanent tenure holder in any register described in clause (e) of section 32 of the U. P. Land Revenue Act, 1901, as it stood immediately prior to the coming into force of this Act, or, subject to the restriction mentioned with respect to the register described in clause(e) in any of the registers maintained under section 33 of the said Act or in a similar register described in or prepared or maintained under any other Act, Rule, Regulation or Order relating to the preparation or maintenance of record of rights in force at any time and includes share in or of an "estate '. Explanation : The Act, Rule, Regulation or order referred to in this clause shall include Act, Rule, Regulation or order made or promulgated by the erstwhile Indian State whose territories were merged or absorbed in the State of Uttar Pradesh prior to the date of vesting notified under section 4 of this Act. " In the light of this definition the Division Bench came to the conclusion that only the areas expressly mentioned in the Khewats vested in the State. It accordingly dismissed the appeals filed by the State and partly allowed the appeal of the petitioner. The State filed two petitions for leave to appeal, one against the judgment in Special Appeal No. 267/1957 and the other against the judgment in Special Appeal No. 292/1957. The Raja filed a petition for leave to appeal against the judgment in Special Appeal No. 267/1957. The High Court granted three certificates on August 16, 1963, and three appeals are now before us, all arising out of the one petition under article 226 filed by the petitioner Raja. On January 1, 1964, the English translation of the impugned Act (U. P. Act No. 1 of 1964) was published, it having received assent 365 of the President on December 31, 1963. The relevant portion of the impugned Act reads as follows: "Section 2. In the Uttar Pradesh Zamindari Abolition and Land Reforms Act, 1950 (hereinafter called the principal Act), in clause (8) of Section 3, the following proviso shall, with effect from the first day of July, 1952, be added before the explanation, and the notifications issued under the principal Act (including sections 2 and 4 thereof) or the U. P. Land Reforms (Amendment) Act, 1954 (including section I thereof) or the U. P. Land Reforms (Amendment) Act, 1956 (including section I thereof) or the U. P. Land Reforms (Amendment) Act, 1958 (including section I thereof) shall, notwithstanding any judgment, decree, determination or order of any Court be so construed as if the said proviso had, since the said date, formed part of the principal Act, as also of the definition of the word 'estate ' as given in the Uttar Pradesh Zamindari abolition and Land Reforms (Amendment) Act, 1958: Provided that in Mirzapur District each of the areas bounded as given in Schedule VII shall, notwithstanding anything contained in the foregoing definition, be deemed to be an estate. After Schedule VI of the principal Act, the following new Schedule shall be added and be deemed to have been so added with effect from the first day of July, 1952. Schedule VII [See proviso to clause (8) of section 3] 1. The area known as Pargana Agori in district Mirzapur bounded in the North by the Kaimur Range confining with the villages Padaunian (also known as Parhwanian), Chingauri, Guraul (also known as Gurwal) Karaundia, Barauli, Dumkari Khirhata, Gadman, Khajraul (also known as Khajuraul) Dugauli, Baragaon, Jurauli, Jurauli Kulani, Rajpur, Raipura, Senduri, Raghunathpur, Bahawar, Basauli, Baghuwari, Lodhi, Raunp, Musahi, Churk and Urauli (also known as Arauli) of Pargana Barhar and villages Biranchuwa, Makri Bari, Pokhraundh, Lauwa, Cherui, Baghma, Markundi of Pargana Bijaigarh of district Mirzapur as far as the Western boundary of village Sasnai of Pargana Bijaigarh which then forms the boundary between Parganas Agori and Bijaigarh upto the point opposite the junction of the rivers Kanhar and Son and thence onward the River Son, forms its northern boundary. 366 in the east and south east by the territory of the State of Bihar; in the South by Tehsil Dudhi of District Mirzapur; in the South West and West by the territory of Madhya Pradesh (erstwhile Rewa State); but excluding village Kishun Chak, which is a separate estate within Pargana Agori and is bounded on the North, East and South by village Kon Khas and in the West by village Mohiuddinpur of District Mirzapur. " The learned counsel for the State has raised three points before us in the two appeals filed by the State: (1) In view of the impugned Act, Pargana Agori is an "estate within the Reforms Act; (2) The High Court was in error in holding that on account of the mention of a wrong area in the khewat the entry cannot be said to be in respect of the entire area; (3) Naksha Pattidaris prepared by Rai Manak Chand in 1843 in connection with settlement operations constituted record of rights. On the first point M On the first point Mr. A. K. Sen, the learned counsel for the Raja, contends that the impugned Act cannot be saved under article 31A because it has not been passed for agrarian reforms and, secondly, that the impugned Act includes an area within the definition of "estate" in the Reforms Act which is not an "estate" within article 31A(2). He says that the validity of the acquisition under the Reforms Act must be judged in the light of article 31 and article 19. article 31A(2) as enacted by Constitution (Seventeenth Amend ment) Act, 1964, reads as follows: "31A(2) In this article (a) the expression 'estate ' shall in relation to any local area, have the same meaning as that expression or its local equivalent has in the existing law relating to land tenures in force in that area and shall also include (i) any jagir, inam or muafi or other similar grant and in the States of Madras and Kerala any janmam right; (ii) any land held under ryotwari settlement; (iii) any land held or let for purposes of agriculture or for purposes ancillary thereto, including waste land, forest land for pasture or sites of buildings and other 367 structures occupied by cultivators of land, agricultural labourers and village artisans; (b) the expression 'right ' in relation to an estate, shall include any rights vesting in a proprietor, sub proprietor, under proprietor, tenure holder, raivat, under raivat or other intermediary and any rights or privileges in respect of land revenue. " It is apparent from the definition that as far as the first part of clause (a) is concerned, we have to look to the meaning given to the expression "estate" or its local equivalent in an existing law relating to tenures. We cannot have recourse to the meaning given in a law which is not existing law. Existing law is defined in article 366(10) thus: " 'Existing law ' means any law, ordinance, order, bye law, rule or regulation passed or made before the commencement of this Constitution by any Legislature, authority or person having power to make such a law, Ordinance, order, bye law, rule or regulation;" Therefore, if the State desires to invoke article 31A and rely on the definition contained in the first part of clause (a) it must show that the area sought to be acquired is an "estate" within the definition contained in a law relating to land tenures passed before the commencement of the Constitution. The relevant definition for our purposes is contained in section 4(4) of the U.P. Land Revenuie Act 1901. It is not necessary to decide whether Pargana Agor ails within the definition of "Mahal" as we have come to the conclusion that Pargana Agori is a Jagir or Inam or a grant of a similar nature within clause (a) (i) of article 31A(2). But before giving our reasons for this conclusion we will dispose of the contention of the learned counsel that Pargana Agori is an estate within cl. (a) (iii) of that Article. According to the learned counsel for the State any waste land or forest land would fall within clause (a)(iii) He says that it is not necessary that it should be held or let for purposes of agriculture or for purposes ancillary thereto. In other words, he would rewrite clause (a)(iii) as follows: Clause (a) (iii) (A) any land held or let for purposes of agriculture or for purposes ancillary thereto, (B) any waste land, forest land for pasture, (C) sites of building and other structures occupied by cultivators of land, agricultural labourers and village artisan. 368 We are unable to read clause (a)(iii) in this way. It seems to us that if this was the intention, cl. (a)(iii) would have been split up and waste land, forest land and land for pasture would have figured separately in a separate clause. There are vast areas of forest land and waste land in India and it is not to be expected that these would be included in the definition indirectly by expanding the word "land". If this was the intention at least the word "including" would have been omitted and substituted by "any". Further the whole object of article 31A is to carry out agrarian reforms and it 'is difficult to see how agrarian reforms can be furthered by the acquisition of every parcel of forest land or waste land. In our opinion the word "including" is intended to clarify or explain the concept of land held or let for purposes ancillary to agriculture. The idea seems to be to remove any doubts on the point whether waste land or forest land could be held to be capable of being held or let for purposes ancillary to agriculture. We must, therefore, hold that forest land or waste land in the area in dispute cannot be deemed to be an estate within cl.(a)(iii) unless it was held or let for purposes ancillary to agriculture. There is no dispute that the cultivated portion of Pargana Agori would fall within clause (a)(iii). The next point is whether Pargana Agori is a Jagir, Inam or other similar grant within article 31A(2)(a)(i). The learned counsel for the State relies on the following facts. About the year 1744 A. D. Shambu Shah the then Raja of Agori was dispossessed of his domains by Raja Balwant Singh and he brought the estate to his own use. It appears from Robert 's report that Raja Balwant Singh and his successor Chet Singh remained in possession for about 40 years. During the insurrection of Chet Singh, Adil Shah, grandson of Shambu Shah, attended on Warren Hastings and made himself so useful that the Governor General gave him a sanad restoring him the Zamindari of Agori Barhar (vide Sherring Hindu Tribes Caste Vol. 1, pages 182 183)reproducedin Baijnath Prasad Singh vs Taj Bali Singh(1) He helped the British in the military operations against Chet Singh thus: "Meanwhile the information of Chet Singh 's flight reached the Governor General at Chunar and a strong force was sent under Major Popham to take possession of Latifpur and then to reduce Bijaigarh. The GovernorGeneral, after visiting Patita, returned to Ramnagar on September 28th, and after restoring confidence by the issue of proclamations of amnesty, formally installed Mahip Narayan Singh, the daughter 's son of Balwant Singh, as (1) A.I.R. 1917 All. 369 successor to Chet Singh. Major Popham and his forces reached Latifpur without opposition and having garrisoned the place with two companies of sepoys under Captain Palmer, proceeded towards Bijaigarh, which he reached after a difficult and trying march. A survey of the height of the fort immediately dispelled all idea of capturing it by escalade. But the Raja of Agori, who had been expelled by Balwant Singh and was now seeking restoration to his ancestral domains, pointed out that the adjoining hill of Lowa Koh commanded the fort and was undefended. Accordingly a battery was at. once thrown up on Lowa Koh, as also on another hill to the north of the fort. On the following day fire was opened from these batteries and resulted in the speedy silencing of the guns of the enemy, which were very ineffectively served." (vide District Gazetteer of Mirzapur page 237) The sanad is dated October 9, 1781, and the translation reads as follows: "Be it known to Azzat Asar (respected) Adal Singh, Zamindar Pargana Agori. That on the basis of his application it has been learnt that the Zamindari of the aforesaid Pargana is his ancient hereditary property and that some years ago Raja Balwant Singh forcibly dispossessed him therefrom and himself took possession thereof Therefore, in view of Bargadam Haqeeq, he should be restored to his own rights so that he may carry on the settling and management of the aforesaid Pargana under the authority of the Amil and Rafat Wa Awali Martabat Raja Mahip Narain Bahadur (?). It be considered as very urgent and be complied with accordingly. Dated the 20th of Shawalul Mukarram, 1195 Hijri Qudsi, corresponding to the 9th of October, 1781, A. D. Qalmi. " Another translation appears in Baijnath Prasad Singh vs Tej Bali Singh:(1) "Be it known to Adil Shah, respectable zamindar of Pergana Agori, that on a petition having been made, it is known that the zamindari in the pargana aforesaid is his old ancestral property. Several years ago Raja Balwant Singh forcibly dispossessed him and brought it to his use. Therefore, in lieu of former rights he should remain in proprietary possession of his share as heretofore. He should make arrangements as regards the cultivation of the land and population of the pargana aforesaid in accordance with the directions of the Revenue Officer (1) A.I.R. 1917 All. 370 and Raja Mohit Narain Bahadur of high rank. He is insisted on doing as directed above." On October 15, 1781, a sanad was granted to the petitioner 's ancestor Adil Shah granting him an Ultmagah Jagir of Rs. 8,001/from Fasli year 1189. Adil Shah obtained possession of the Pargana with the assistance of the British troops. On November 4, 1803, a sanad was granted to the petitioner 's ancestors granting a Jagir of Rs. 8,001/ per annum. Mr. A. K. Sen contends that the sanad was set aside by resolution of the Governor General in Council dated April 1788 (see paragraph 16 of the G.O. No. 3824 of August 30, 1845 printed on page 97 of the Thomason Despatches). He relies on this statement contained in the judgment of the High Court in Writ Petition No. 454/1955 dated November 2, 1962. But this statement refers to the sanad dated October 15, 1781, and not to the sanad dated October 9, 1781, or the later sanad dated November 4, 1803. It appears from the District Gazetteer (page 255) that as soon as Adil Shah obtained possession of the zamindari, Adil Shah really forfeited his claim to the assigned villages, the revenue of which was Rs. 8001/ and as possession had been obtained at the time of the general settlement in 1788 the Governor General in Council ordered the assignment to be resumed. Adil Shah died in 1794 and the New Raja became involved in monetary difficulties. Mr. Barton, the then Collector, made certain proposals and they were accepted at Calcutta and orders were issued to him to revise the assessment of Agori Barhar in such a way as to give the Raja a net profit of Rs. 8,001/ per annum or to allot him, in lieu thereof, a certain number of villages assessed to that amount. Accordingly the revision of certain revenue paying villages took place, and in addition to the villages assigned by Mr. Duncan, certain others assessed to a sum of Rs. 4,000/ were made over to the Raja. This arrangement brought taluqas Agori and Singrauli into the Raja 's possesssion, with the result that he became in 1804 both zamindar and jagirdar, or assignee of the Government demand, in taluqas Kon and Agori, Singrauli and 28 villages in Barhar. Paras 11 to 15 of Robert 's report dated January 1, 1847, are to the same effect. It seems to us clear from the above facts that Pargana Agori is still held under the sanad dated October 9, 1781, and the sanad dated November 4, 1803. The second sanad is a grant of land revenue. That is definitely a Jagir. The learned counsel for the State contends that the fact that Adil Shah asserted a prior title may have been one of the reasons for the restoration of the zamindari, but it was in essence a new grant made on political considerations. He further points out 371 that conditions are also laid down in the Sanad. Adil Shah was enjoined to make arrangements regarding cultivation and population of the pargana and had to obey the directions of the revenue officer and Raja Mohit Narain ]Bahadur in this behalf. As stated by this Court in Thakur Amar Singhji vs State of Rajasthan(1) "we do not find any sufficient ground for putting a restricted meaning on the word 'Jagir ' in article 31A. At the time of the enactment of that Article the word had nearly acquired both in popular usage and legislative practice a wide connotation, and it will be in accord with sound canons of interpretation to ascribe that connotation to that word rather than an archaic meaning to be gathered from a study of ancient tenures. " An inam is explained in Wilsons ' Glossary thus "A gift, a benefication in general, a gift by a superior to an inferior. In India, and especially in the south, and amongst the Marathas, the term was especially applied to grants of land held rent free, and in hereditary and perpetual occupation; the tenure came in time to be qualified by the, reservation of a portion of the assessable revenue, or by the exaction of all proceeds exceeding the intended value of the original assignment; the term was also vaguely applied to grants of rent free land, without reference to perpetuity or any specified conditions. The grants are also distinguishable by their origin from the ruling authorities, or from the village communities and are again distinguishable by peculiar reservations, or by their being applicable to different objects. " In our opinion a grant by the British of lands for services. rendered to them would be a grant falling within cl. It seems to us that on the facts of the case the grant was in thenature of a grant similar to a Jagir or inam. The fact that Balwant Singh and Chet Singh held possession of this Pargana for 40 years, cannot be ignored. This shows that to all intents and purposes Adil Shah had lost the pargana and it was in effect a fresh grant in the nature of Jagir or inam for services rendered to the British. Adil Shah 's assertion to title had not been verified. Although it may be one of the reasons for the grant, it is clear that if it had not been for the grant and its enforcement by the British troop&, Adit Shah would not have been able to recover the possession of the Pargana. His title to the pargana would rest on the grant and not. the alleged previous title. If it is held, as we do hold, that the area in dispute is a grant in the nature of Jagir or inam and consequently an estate within (1) ; 372 article 3 1A(2), the impugned Act can claim the protection of article 3 1A. The notifications dated June 30, 1953, and July 1953, must therefore be upheld. Mr. A. K. Sen further urges that the acquisition of the estate was not for the purposes of agrarian reforms because hundreds of square miles of forest are sought to be acquired. But as we have held that the area in dispute is a grant in the nature of Jagir or inam, its acquisition like the acquisition of all Jagirs, inams, or similar grants, was a necessary step in the implementation of the agrarian reforms and was clearly contemplated in article 3 1 A. In this view it is not necessary to decide whether the area in dispute is a Mahal or covered by section 3(8) of the Reforms Act as it existed in 1958 or earlier or any other question which was raised before us. In the result the appeals filed by the State are accepted, the appeal filed by the petitioner Raja is dismissed and the petition under article 226 filed by the Raja is dismissed. In the circumstances of the case there will be no order as to costs.

The State of Uttar Pradesh issued two notifications in 1953, by one of which the Uttar Pradesh Zamindari Abolition and Land Reforms Act, 1950, was extended to certain areas, in which, Pargana Agori which was owned by the respondent was situate, and by the other, it was directed that all " estates" in the area including the Pargana should vest in the State. The respondent challenged the notifications by a writ petition on the ground that the Pargana was not an estate within section 3 (8) of the Act. While the matter was pending in the High Court, the definition in section 3 (8) was amended by U.P. Act 14 of 1958, and while appeals were pending in this Court, by U.P. Act 1 of 1964, by which, the Pargana was deemed to be an "estate". The amendments had retrospective effect from 1st July 1952. The appellant State contended that Act 1 of 1964 could not be impugned because, the Pargana was an "estate ' either within article 3 1A(2) (a) or (iii). HELD : The forest land or waste land in the Pargana could not be deemed to be an estate within article 3 1A(2) (a) (iii) unless it was held or let for purposes ancillary to agriculture. But the entire Pargana is la grant in the nature of a jagir or inam, having been held by the respondent 's ancestor under sanads granting the land and the land revenue to him for services rendered to the British, and consequently, is an "estate, within article 31A(2) (a) (i) of the Constitution. [368 D, 370 G H; 371 F H] Thakur Amar Singhji vs State of Rajasthan [1955] 2 S.C.R. 303, followed. The acquisition of the Pargana was a necessary step in the implementation of agrarian reforms contemplated by article 31A. Therefore, U.P. Act 1 of 1964 can claim the protection of article 31A, and the two notifications must be upheld. [372 A C}

rl.) Petition No. 96 of 1989. (Under Article 32 of the Constitution of India). Nand Lal, S.K. Bagga and Mrs. S.K. Bagga for the Petitioner. V.C. Mahajan Mrs. Indra Sawhney, Ms. A. Subhashini, Aruneshwar Gupta, Surya Kant and I. Makwana for the Respondents. The Judgment of the Court was delivered by AHMADI, J. Liberty is the life line of every human being. Life without liberty is `lasting ' but not `living '. Liberty is, therefore, considered one of the most precious and cherished possessions of a human being. Any attempt to take liberties with the liberty of a human being is visited with resistance. Since no human being can tolerate fetters on his personal liberty it is not surprising that the petitioner Ashok Kumar alias Golu continues to struggle for his liberty, premature release, not fully content with the enunciation of the law in this behalf 864 by this Court in Maru Ram vs Union of India, {1981] 1 SCR 1196. The questions of law which are raised in this petition brought under Article 32 of the Constitution arise upon facts of which we give an abridged statement. On the basis of a FIR lodged on October 21, 1977, the petitioner was arrested on the next day and he along with others was chargesheeted for the murder of one Prem Nagpal. The petitioner was tried and convicted for murder on December 20, 1978 in Sessions Case No. 32 of 1978 by the learned Sessions Judge, Ganganagar, and was ordered to suffer imprisonment for life. His appeal, Criminal Appeal No. 40 of 1979, was dismissed by the High Court of Rajasthan. Since then he is serving time. It appears that he filed a Habeas Corpus Writ Petition No. 2963 of 1987 in the High Court of Rajasthan at Jodhpur for premature release on the plea that he was entitled to be considered for such release under the relevant rules of Rajasthan Prisons (Shortening of Sentences) Rules, 1958, (hereinafter alluded to as `the 1958 Rules ') notwithstanding the insertion of Section 433A in the Code of Criminal Procedure, 1973 (hereinafter called `the Code ') with effect from December 18, 1978, just two days before his conviction. His grievance was that he was being denied the benefit of early release under the 1958 Rules under the garb of the newly added Section 433A, on the ground that it places a statutory embargo against the release of such a convict `unless he has served atleast 14 years of imprisonment '. He contended that the said provision could not curtail the constitutional power vested in the Governor by virtue of Article 161 of the Constitution which had to be exercised on the advice of the Council of Ministers which advice could be based on a variety of considerations including the provisions of the 1958 Rules. The writ petition was, however, dismissed by the High Court on October 31, 1988, on the ground that it was premature inasmuch as the petitioner 's two representations, one to the Governor and another to the State Home Minister, were pending consideration. The High Court directed that they should be disposed of within one month. In this view of the matter the High Court did not deem it necessary to consider the various questions of law raised in the petition on merits. After the rejection of his writ petition by the High Court, the petitioner through his counsel addressed a letter dated November 28, 1988 to the Governor inviting his attention to the earlier representation dated August 29, 1988 and requesting him to take a decision thereon within a month as observed by the High Court. Failing to secure his early release notwithstanding the above efforts, the petitioner has invoked the extraordinary jurisdiction of this Court under Article 32 of the Constitution. 865 The petitioner 's case in a nutshell is that under the provisions of the 1958 Rules, a `lifer ' who has served an actual sentence of about 9 years and 3 months is entitled to be considered for premature release if the total sentence including remissions works out to 14 years and he is reported to be of good behaviour. However, the petitioner contends, his case for premature release is not considered by the concerned authorities in view of the newly added section 433A of the Code on the interpretation that by virtue of the said provision the case of a `lifer ' cannot be considered for early release unless he has completed 14 years of actual incarceration, the provisions of sections 432 and 433 of the Code as well as the 1958 Rules notwithstanding. According to him, even if the provisions of sections 432 and 433 of the Code do not come into play unless a convict sentenced to life imprisonment has completed actual incarceration for 14 years as required by section 433A, the authorities have failed to realise that section 433A cannot override the constitutional power conferred by Articles 72 and 161 of the Constitutional on the President and the Governor, respectively, and the State Government i.e., the Council of Ministers, could advise the Governor to exercise power under Article 161 treating the 1958 Rules as guidelines. Since the petitioner had already moved the Governor under Article 161 of the Constitution it was incumbent on the State Government to consider his request for early release, notwithstanding section 433A, and failure to do so entitled the petitioner to immediate release as his continued detention was, wholly illegal and invalid. In support of this contention the petitioner has placed reliance on the ratio of Maru Ram 's decision. The petitioner brands section 433A of the Code to be a `legislative fraud ' inasmuch as the said provision was got approved by the Parliament on the assurance that the said provision is complementary to the various amendments proposed in the Indian Penal Code. In the alternative it is contended that in any case this Court should by a process of interpretation limit the scope of section 433A of the Code to those cases only to which it would have been limited had the legislation proposing amendments in the Indian Penal Code gone through. In any case after the decision of this Court in Maru Ram 's case, the efficacy of section 433A is considerably reduced and the petitioner is entitled to early release by virtue of the power contained in ARticle 161 read with the 1958 Rules even if guidelines are not formulated notwithstanding the subsequent decision of this Court in Kehar Singh vs Union of India, ; Counsel submitted that after the decision of this Court in Bhagirath vs Delhi Administration, ; whereunder this Court extended the benefit of section 428 of the Code even 866 to life convicts, the ratio in Gopal Godse vs State of Maharashtra, ; had undergone a change. On this broad approach, counsel for the petitioner, formulated questions of law which may be stated as under: 1. Whether the insertion of section 433A in the Code was a legislative fraud inasmuch as the connected legislation, namely, the Indian Penal Code (Amendment) Bill XLII of 1972 did not become law although passed by the Rajya Sabha as the IPC (Amendment) Act, 1978, on November 23, 1978? 2. Whether on the ration of Maru Ram 's decision, in the absence of any guidelines formulated by the State under Article 72 of 161 of the Constitution, section 433A of the Code would not apply to life convicts and the 1958 Rules will prevail for the purpose of exercise of power under Article 72 of 161 of the Constitution? Inter connected with this question, the following .l questions were raised: a) Whether Maru Ram 's decision is in conflict with Kehar Singh 's Judgment on the question of necessity or otherwise of guidelines for the exercise of power under Article 7 and 161 of the constitution? b) Whether the use of two expressions "remission" and "remit" in Articles 72 and 161 convey two different meanings and if yes, whether the content f power in the two expressions is different? c) Whether the persons sentenced to death by Court, whose death sentence has been commuted to life imprisonment by executive clemency, form a distinct and separate class for the purpose of application of section 433A of the Code as well as for the purpose of necessity (or not) of guidelines for premature release in exercise of power under Articles 72 and 161, from the persons who at the initial stage itself were sentenced to life imprisonment by court verdict? And whether in the latter case guidelines are mandatory under Article 72 and 161 and a well designed scheme of remission must be formulated if the constitutional guarantee under Articles 14 and 21 is to be preserved? d) Whether the whole law of remission needs to be reviewed after Bhagirath 's case wherein this Court held that imprisonment 867 for life is also an imprisonment for a term and that a life convict is entitled to set off under section 428 Cr. P.C.? e) Whether it is permissible in law to grant conditional premature release to a life convict even before completion of 14 years of actual imprisonment notwithstanding section 433A of the Code? If yes, whether the grant of such conditional release will be treated as the prisoner actually serving time for the purpose of section 433A of the Code? First the legislative history. The Law Commission had in its 42nd Report submitted in June, 1971 suggested numerous changes in the Indian Penal Code (IPC). Pursuant thereto an Amendment Bill No. XLII of 1972 was introduced in the Rajya Sabha on December 11, 1972 proposed wide ranging changes in the IPC. One change proposed was to bifurcate section 302, IPC into two parts, the first part providing that except in cases specified in the second part, the punishment for murder will be imprisonment for life whereas for the more heinous crimes enumerated in clauses (a) to (c), of sub section (2) the punishment may be death or imprisonment for life. A motion for reference of the Bill to the Joint Committee of both the Houses was moved in the Rajya Sabha on December 14, 1972 by the then Minister of State in the Ministry of Home Affairs and was adopted on the same day. The Lok Sabha concurred in the motion of the Rajya Sabha on December 21, 1972. The Joint Parliamentary Committee presented its report to the Rajya Sabha on January 29, 1976 recommending changes in several clauses of the Bill. While retaining the amendment proposed in section 302, IPC, it recommended inclusion of one more clause (d) after clause (c) in sub section (2) thereof and at the same time recommended deletion of section 303, IPC. It also recommended substitution of the existing section 57, IPC, by a totally new section, the proviso whereto has relevance. The proposed proviso was as under: "Provided that where a sentence of imprisonment for life is imposed on conviction of a person for a capital offence, or where a sentence of death imposed on a person has been commuted into one of imprisonment for life, such person shall not be released from prison unless he had served at least fourteen years of imprisonment. " The reason which impelled the Committee to introduce the above proviso was "That sometimes due to grant of remission even murderers sentenced or commuted to life imprisonment were released at the end 868 of 5 to 6 years. " The Committee, therefore, felt that such a convict should not be released unless he has served atleast 14 years of imprisonment. It is evident from the scheme of the aforesaid recommendations that the proviso was intended to apply to only those convicts who were convicted for a capital offence (this expression was defined by clause 15 of the Bill recommending substitution of section 40, IPC, as `an offence for which death is one of the punishments provided by law ') or whose sentence of death was commuted into one of imprisonment for life and not to those who were governed by the first part of the proposed section 302, IPC. It was pointed out by counsel that similar benefit would have accrued to offenders convicted for offences covered under section 305, 307 or 396 if the proposed sections 305, 307(b) and 396(b) had come into being. That, contends the petitioner 's counsel, would have considerably narrowed down the scope of the proposed proviso to section 57, IPC, and consequently the rigour of the said provision would have fallen on a tiny minority of offenders guilty of a capital offence. Pursuant to the recommendations made by the Committee, two bills, namely, the IPC (Amendment) Bill, 1978, came to be introduced, the former was passed with changes by the Rajya Sabha on November 23, 1978 while the latter was introduced in the Lok Sabha on November 8, 1978, and in the Rajya Sabha on December 5, 1978. The proposal to add a proviso to the proposed section 57, IPC did not find favour as it was thought that the said subject matter appropriately related to Chapter XXXII of the Code and accordingly the said provision was introduced as section 433A in the Code. While the amendments to the Code became law with effect from December 18, 1978, the IPC amendments, though passed by the Rajya Sabha could not be got through the Lok Sabha and lapsed. It may here be mentioned that the IPC Bill as approved by the Rajya Sabha contained the proposal to divide section 302 into two parts, in fact an additional clause was sought to be introduced in the second part thereof and sections 305, 307 and 396 were also sought to be amended as proposed by the Committee. This in brief is the legislative history. In the backdrop of the said legislative history, counsel for the petitioner argued that a legislative fraud was practised by enacting section 433A of the Code and failing to carry out the corresponding changes in sections 302, 305, 307, 396, etc., assured by the passing of the Indian Penal Code (Amendment) Act, 1978, by the Rajya Sabha on November 23, 1978. According to him it is evident from the scheme of the twin Amendment Bills that the legislative intent was to apply the rigour of section 433A of the Code to a small number of heinous 869 crimes which fell within the meaning of the expression capital offence. It was to achieve this objective that section 302, IPC was proposed to be bifurcated so that a large number of murders would fall within the first part of the proposed provision which prescribed the punishment of life imprisonment only and thus fell beyond the mischief of section 433A of the Code. To buttress his submission our attention was invited to Annexure II to the petition which is a copy of the letter dated July 10, 1979, written by the Joint Secretary in the Ministry of Home Affairs to Home Secretaries of all the concerned State Governments explaining the purport of the newly added section 433A. After explaining that section 57, IPC, had a limited scope, namely, calculating fractions of terms of imprisonment only, he proceeds to state in paragraph 3 of the letter as under: "The restrictions imposed by section 433A applies only to those life convicts who are convicted for offences for which death is one of the punishments prescribed by law. In the Indian Penal Code (Amendment) Bill, 1978 as passed by the Rajya Sabha and now pending in the Lok Sabha, section 302 is proposed to be amended so as to provide that the normal punishment for murder shall be imprisonment for life and that only in certain cases of aggravating circumstances will the court have discretion to award death sentences. " Then in paragraph 4 he proceeds to clarify as under: "Even regarding these convicts the restriction imposed by section 433A is not absolute for, the Constitutional power of the Governor under Article 161 to commute and remit sentences remains unaffected and can be exercised in each case in which the exercise of this power is considered suitable. " Then in paragraph 4 he proceeds to clarify as under: "Even regarding these convicts the restriction imposed by section 433A is not absolute for, the Constitutional power of the Governor under Article 161 to commute and remit sentences remains unaffected and can be exercised in each case in which the exercise of this power is considered suitable. " In paragraph 6 of the detailed note appended to the said letter, the legal position was explained thus: "It may be pointed out that the restriction introduced by section 433A does not apply to all life convicts. It applies only to those prisoners who are convicted of a capital offence i.e. an offence for which death is one of the punishments prescribed by law. Once the Indian Penal Code (Amendment) Bill becomes the law, offenders sentenced 870 under proposed section 302(i) will not be covered by this provision as the offence will not be a capital offence. Thus in future the restriction introduced by section 433A will not be applicable to them and will, in effect, cover only a very small number of cases. Even in this small number of cases the restriction will not in any way curb the Constitutional power to grant remission and commutation vested in the President or the Governor by virtue of Articles 72 and 161. " There can be no doubt that by this letter it was clarified that section 433A of the Code will apply to only those convicted of a capital offence and not to all life convicts. It is equally clear that the said provision was expected to apply to exceptionally heinous offences falling within the definition of `capital offence ' once the Indian Penal Code (Amendment) Bill became law. Section 433A was, therefore, expected to deny premature release before completion of actual 14 years of incarceration to only those limited convicts convicted of a capital offence, i.e., an exceptionally heinous crime specified in the second part of the proposed section 302, IPC. Lastly it clarifies that section 433A cannot and does not in any way affect the constitutional power conferred on the President/Governor under ARticle 72/161 of the Constitution. It cannot, therefore, be denied that this letter and the accompanying note does give an impression that certain provisions of the Indian Penal Code (Amendment) Boll were interlinked with section 433A of the Code. Assuming the Criminal Procedure Code (Amendment) Bill and the Indian Penal Code (Amendment) Bill were intended to provide an integrated scheme of legislation, can it be said that the failure on the part of the Lok Sabha to pass the letter renders the enactment of the former by which section 433A was introduced in the Code, `a legislative fraud ' as counsel had liked to call it or to use a more familiar expression `colourable exercise of legislative power '? Counsel submitted that section 433A was got introduced on the statute book by deception, in that, when the former Bill was made law an impression was given that the twin legislation which had already been cleared by the Rajya Sabha on November 23, 1978 would in due course be cleared by the Lok Sabha also so that the application of section 433A would be limited to capital offences only and would have no application to a large number of `lifers '. It must be conceded that such would have been the impact if the Indian Penal Code (Amendment) Bill was passed by the Lok Sabha in the form in which the Rajya and approved it. 871 This is not a case of legislative incompetence to enact section 433A. No such submission was made. Besides the question of vires of section 433A of the Code has been determined by the Constitution Bench of this Court in Maru Ram 's case. This Court repelled all the thrusts aimed at challenging the constitutional validity of section 433A. But counsel submitted that the question was not examined from the historical perspective of the twin legislations. Counsel for the State submitted that it was not permissible for us to reopen the challenge closed by the Constitution Bench on the specious plea that a particular argument or plea was not canvassed or made before that Bench. The objection raised by counsel for the State Government is perhaps not without substance but we do not propose to deal with it because even otherwise we see no merit in the submission of the petitioner 's counsel. It is only when a legislature which has no power to legislate frames a legislation so camouflaging it as to appear to be within its competence when it knows it is not, it can be said that the legislation so enacted is colourable legislation. In K.C. Gajapati Narayan Deo vs State of Orissa, ; the Orissa Agricultural Income tax (Amendment) Act, 1950, was challenged on the ground of colourable legislation or a fraud on the Constitution as its real purpose was to effect a drastic reduction in the amount of compensation payable under the Orissa Estates Abolition Act, 1952. The facts were that a Bill relating to the Orissa Abolition Act, 1952 was published in the Gazette on January 3, 1950. It provided that any sum payable for agricultural income tax for the previous year should be deducted from the gross asset of an estate for working out the net income on the basis whereof compensation payable to the estate owner could be determined. Thereafter on January 8, 1950, a Bill to amend the Orissa Agricultural Income tax, 1947, was introduced to enhance the highest rate of tax from 3 annas to 4 annas in a rupee and to reduce the highest slab from Rs. 30,000 to Rs. 20,000. The next Chief Minister, however, dropped this Bill and introduced a fresh Bill enhancing the highest rate to 12 annas 6 pies in a rupee and reducing the highest slab to rs. 15,000 only. On the same becoming law it was challenged on the ground that the real purpose of the legislation was to drastically reduce the compensation payable to the estate owners. Mukherjea, J., who spoke for the Court observed as under: "It may be made clear at the outset that the doctrine of colourable legislation does not involve any question of bona fides or mala fides on the part of the legislature. The whole doctrine resolves itself into the question of competency of a particular legislature to enact a particular law. If 872 the legislature is competent to pass a particular law, the motives which impelled it to act are really irrelevant. On the other hand, if the legislature lacks competency, the question of motive does not arise at all. Whether a statute is constitutional or not is thus always a question of power. " Thus the whole doctrine resolves itself into a question of competency of the concerned legislature to enact the impugned legislation. If the legislature has transgressed the limits of its powers and if such transgression is indirect, covert or disguised, such a legislation is described as colourable in legal parlance. The idea conveyed by the use of the said expression is that although apparently a legislature in passing the statute purported to act within the limits of its powers, it had in substance and reality transgressed its powers, the transgression being veiled by what appears on close scrutiny to be a mere pretence or disguise. In other words if in pith and substance the legislation does not belong to the subject falling within the limits of its power but is outside it, the mere form of the legislation will not be determinate of the legislative competence. In Sonapur Tea Co. Ltd. vs Must. Mazirunnessa; , it was reiterated relying on Gajapati 's case that the doctrine of colourable legislation really postulates that legislation attempts to do indirectly what it cannot do directly. Such is not the case before us. It is no body 's contention that Parliament was not competent to amend the Criminal Procedure Code by which section 433A was inserted. Whether or not the connecting Indian Penal Code (Amendment) Bill ought to have been cleared or not was a matter left to the wisdom of the Lok Sabha. Merely because the Criminal Procedure Bill was made law and the Indian Penal Code (Amendment) Bill was passed by the Rajya Sabha did not obligate the Lok Sabha to clear it. The Lok Sabha to clear it. The Lok Sabha could have its own views on the proposed Indian Penal Code amendments. It may agree with the executive 's policy reflected in the Bill, with or without modifications, or not at all. Merely because in the subsequent instructions issued by the letter of July 10, 1979 and the accompanying note (Annex. II) the Joint Secretary had interlinked the two Bills, the Lok Sabha was under no obligation to adopt the measure as such representation could not operate as estoppel against it. Even the indirect attempt on the part of the High Court of Himachal Pradesh in the ragging case to force the State Government to legislate, State of Himachal Pradesh vs A Parent of a student of Medical College, Simla, [1985] 3 SCC 169 was disapproved by this Court as a matter falling, outside the functions and duties of the judiciary. It is, therefore, obvious that no question of mala fides on the part of the legislature was involved in the enactment of one legislation and failure to 873 enact another. There is no question of `legislative fraud ' or `colourable legislation ' involved in the backdrop of the legislative history of section 433A of the Code as argued on behalf of the petitioner. Counsel for the Petitioner, However, tried to seek support form the Privy Council decision in W.R. Moram vs Deputy Commissioner of Taxation for N.S.W., Wherein the question to be considered was whether the legislative scheme was a colourable one forbidden by section 5(ii) of the Australian Constitution. There was no attempt to disguise the scheme as it was fully disclosed. The Privy Council, while holding that the scheme was not a colourable legislation, observed that `where there is admittedly a scheme of proposed legislation, it seems to be necessary when the `pith and substance ' or `scope and effect ' of any one of the Acts is under consideration, to treat them together and to see how they interact '. But that was a case where the scheme was carried out through enactments passed by the concerned legislatures. It is in that context that the above observations must be read and understood. In the present case also if both the Bills had become law, counsel would perhaps have been justified in demanding that in understanding or construing one legislation or the other, the scheme common to both must be kept in view and be permitted to interact. But where the linkage does not exist on account of the Indian Penal Code (Amendment) Bill not having become law we are unable to appreciate how section 433A can be read down to apply to only those classes of capital offences to which it would have applied had the said Bill been passed by the Lok Sabha in the terms in which it was approved by the Rajya Sabha. The language of section 433A is clear and unambiguous and does not call for extrinsic aid for its interpretation. To accept the counsel 's submission to read down or interpret section 433A of the Code with the aid of the change proposed by the Indian Penal Code (Amendment) Bill would tantamount to treating the provisions of the said Bill as forming part of the Indian Penal Code which is clearly impermissible. To put such an interpretation with the aid of such extrinsic material would result in violence to the plain language of section 433A of the Code. We are, therefore, unable to accept even this second limb of the contention. The law governing suspension, remission and commutation of sentence is both statutory and constitutional. The stage for the exercise of this power generally speaking is post judicial, i.e., after the judicial process has come to an end. The duty to judge and to award the appropriate punishment to the guilty is a judicial function which culminates by a judgment pronounced in accordance with law. After 874 the judicial function thus ends the executive function of giving effect to the judicial verdict commences. We first refer to the statutory provisions. Chapter III of IPC deals with punishments. The punishments to which the offenders can be liable are enumerated in section 53, namely, (i) death (ii) imprisonment for life (iii) imprisonment of either description, namely, rigorous or simple (iv) forfeiture of property and (v) fine. Section 54 empowers the appropriate government to commute the punishment of death for any other punishment. Similarly section 55 empowers the appropriate government to commute the sentence of imprisonment for life for imprisonment of either description for a term not exceeding 14 years. Chapter XXXII of the Code, to which section 433A was added, entitled `Execution, Suspension, Remission and Commutation of sentences ' contains sections 432 and 433 which have relevance; the former confers power on the appropriate government to suspend the execution of an offender 's sentence or to remit the whole or any part of the punishment to which he has been sentenced while the latter confers power on such Government to commute (a) a sentence of death for any other punishment (b) a sentence of imprisonment for life, for imprisonment for a term not exceeding 14 years of for fine (c) a sentence of rigorus imprisonment for simple imprisonment or for fine and (d) a sentence of simple imprisonment for fine. It is in the context of the aforesaid provisions that we must read section 433A which runs as under: "433A. Restriction on powers of remission or commutation in certain cases Notwithstanding anything contained in Section 432, where a sentence of imprisonment for life is imposed on conviction of a person for an offence for which death is one of the punishments provided by law, or where a sentence of death imposed on a person has been commutted under section 433 into one of imprisonment for life, such person shall not be released from prison unless he had served at least fourteen years of imprisonment. " The section begins with a non obstante clause notwithstanding anything contained in section 432 and proceeds to say that where a person is convicted for an offence for which death is one of the punishments and has been visited with the lesser sentence of imprisonment for life or where the punishment of an offender sentenced to death has been commuted under section 433 into one of imprisonment for life, such offender will not be released unless he has served at least 14 years of imprisonment. The reason which impelled the legislature to insert this provision has been stated earlier. Therefore, one who could have been 875 visited with the extreme punishment of death but on account of the sentencing court 's generosity was sentenced to the lesser punishment of imprisonment for life and another who actually was sentenced to death but on account of executive generosity his sentence was commutted under section 433(a) for imprisonment for life have been treated under section 433A as belonging to that class of prisoners who do not deserve to be released unless they have completed 14 years of actual incarceration. Thus the effect of section 433A is to restrict the exercise of power under sections 432 and 433 by the stipulation that the power will not be so exercised as would enable the two categories of convicts referred to in section 433A to freedom before they have completed 14 years of actual imprisonment. This is the legislative policy which is clearly discernible from the plain language of section 433A of the Code. Such prisoners constitute a single class and have, therefore, been subjected to the uniform requirement of suffering atleast 14 years of internment. Counsel for the petitioner next submitted that after this court 's decision in Bhagirath 's case permitting the benefit of set off under section 428 in respect of the detention period as an undertrial, the ratio of the decision in Godse 's case must be taken as impliedly disapproved. We see no basis for this submission. In Godse 's case the convict who was sentenced to transportation for life had earned remission for 2963 days during his internment. He claimed that in view of section 57 read with section 53A, IPC, the total period of his incarceration could not exceed 20 years which he had completed, inclusive of remission, and, therefore, his continued detention was illegal. Section 57, IPC reads as follows: "57. Fractions of terms of punishment In calculating fractions of terms of punishment, imprisonment for life shall be reckoned as equivalent to imprisonment for twenty years. " The expression `imprisonment for life ' must be read in the context of section 45, IPC. Under that provision the word `life ' denotes the life of a human being unless the contrary appears from the context. We have seen that the punishments are set out in section 53, imprisonment for life being one of them. Read in the light of section 45 it would ordinarily mean imprisonment for the full or complete span of life. Does section 57 convey to the contrary? Dealing with this contention based on the language of section 57, this Court observed in Godse 's case at pages 444 45 as under: 876 "Section 57 of the Indian Penal Code has no real bearing on the question raised before us. For calculating fractions of terms of punishment the section provides that transportation for life shall be regarded as equivalent to imprisonment for twenty years. It does not say that transportation for life shall be deemed to be transportation for twenty years for all purposes; nor does the amended section which substitutes the words "imprisonment for life" for "transportation for life" enable the drawing of any such all embracing fiction. A sentence of transportation for life or imprisonment for life must prima facie be treated as transportation or imprisonment for the whole of the remaining period of the convicted person 's natural life. " This interpretation of section 57 gets strengthened if we refer to sections 65, 116, 120 and 511, of the Indian Penal Code which fix the term of imprisonment thereunder as a fraction of the maximum fixed for the principal offence. It is for the purpose of working out this fraction that it became necessary to provide that imprisonment for life shall be reckoned as equivalent to imprisonment for 20 years. If such a provision had not been made it would have been impossible to work out the fraction of an in definite term. In order to work out the fraction of terms of punishment provided in sections such as those enumerated above, it was imperative to lay down the equivalent term for life imprisonment. The second contention urged before the Court in Godse 's case was based on the Bombay Rules governing the remission system framed in virtue of the provisions contained in the . This Court pointed out that the did not confer on any authority a power to commute or remit sentences. The Remission Rules made thereunder had, therefore, to be confined to the scope and ambit of that statute and could not be extended to other statutes. Under the Bombay Rules three types of remissions for good conduct were allowed and for working them out transportation for life was equated to 15 years of actual imprisonment. Dealing with Godse 's plea for premature release on the strength of these rules this Court observed at page 447 as under: "The rules framed under the enable such a person to remission ordinary, special and State and the said remissions will be given credit towards his term of imprisonment. For the purpose of working out the remis 877 sions the sentence of transportation for life is ordinarily equated with a definite period, but it is only for that particular purpose and not for any other purpose. As the sentence of transportation for life or its prison equivalent the life imprisonment is one of indefinite duration, the remissions so earned do not in practice help such a convict as it is not possible to predicate the time of his death. That is why the rules provide for a procedure to enable an appropriate Government to remit the sentence under section 401 (now section 432) of the Code of Criminal Procedure on a consideration of the relevant factors including the period of remissions earned. The question of remission is exclusively within province of the appropriate Government; and in this case it is admitted that though the appropriate Government made certain remissions under section 401 of the Code of Criminal Procedure, it did not remit the entire sentence. " On this line of reasoning the submission of counsel that if the Court were to take the view that transportation for life or imprisonment for life enures till the last breath of the convict passes out, the entire scheme of remissions framed under the or any like statute and the whole exercise of crediting remissions to the account of the convict would collapse, was spurned. This Court came to the conclusion that the Remission Rules have a limited scope and in the case of a convict undergoing sentence of transportation for life or imprisonment for life it acquires significance only if the sentence is commuted or remitted, subject to section 433A of the Code or in exercise of constitutional power under Articles 72/161. In Maru Ram 's case the Constitution Bench reaffirmed the ratio of Godse 's case and held that the nature of a life sentence is incarceration until death; judicial sentence for imprisonment for life cannot be in jeopardy merely because of long accumulation of remissions. Release would follow only upon an order under section 401 of the Criminal Procedure Code, 1898 by the appropriate Government or on a clemency order in exercise of power under Articles 72/161 of the Constitution. At page 1220 the Constitution Bench expressed itself thus: "Ordinary where a sentence is for a definite term, the calculus of remissions may benefit the prisoner to instant release at that point where the substraction result is zero. 878 Here, we are concerned with life imprisonment and so we come upon another concept bearing on the nature of sentence which has been highlighted in Godse 's case. Where the sentence is indeterminate or of uncertain duration, the result of substraction from an uncertain quantity is still an uncertain quantity and release of the prisoner cannot follow except on some fiction of quantification of a sentence of uncertain duration. " Referring to the facts of Godse 's case and affirming the view that the sentence of imprisonment for life enures upto the last breath of the convict, this Court proceeded to estate as under: "Since death was uncertain, deduction by way of remission did not yield any tangible date for release and so the prayer of Godse was refused. The nature of a life sentence is incarceration until death, judicial sentence of imprisonment for life cannot be in jeopardy merely because of the long accumulation of remissions. " It is, therefore, clear from the aforesaid observations that unless the sentence for life imprisonment is commuted or remitted as stated earlier by the appropriate authority under the provisions of the relevant law, a convict is bound in law to serve the entire life term in prison; the rules framed under the or like statute may enable such a convict to earn remissions but such remissions will not entitle him to release before he has completed 14 years of incarceration in view of section 433A of the Code unless of course power has been exercised under Article 7/161 of the Constitution. It will thus be seen from the ratio laid down in the aforesaid two cases that where a person has been sentenced to imprisonment for life the remissions earned by him during his internment in prison under the relevant remission rules have a limited scope and must be confined to the scope and ambit of the said rules and do not acquire significance until the sentence is remitted under section 432, in which case the remission would be subject to limitation of section 433A of the Code, or constitutional power has been exercised under Article 72/161 of the Constitution. In Bhagirath 's case the question which the Constitution Bench was required to consider was whether a person sentenced to imprisonment for life can claim the benefit of section 428 of the Code which, inter alia provides for setting off the period of detention undergone by the accused as an undertrial against the sentence of 879 imprisonment ultimately awarded to him. Referring to section 57, IPC, the Constitution Bench reiterated the legal position as under: "The provision contained in Section 57 that imprisonment for life has to be reckoned as equivalent to imprisonment for 20 years is for the purpose of calculating fractions of terms in punishment. We cannot press that provision into service for a wider purpose. " These observations are consistent with the ratio laid down in Godse and Maru Ram 's cases. Coming next to the question of set off under section 428 of the Code, this Court held: "The question of setting off the period of detention undergone by an accused as an undertrial prisoner against the sentence of life imprisonment can arise only if an order is passed by the appropriate authority under section 432 of section 433 of the Code. In the absence or such order, passed generally or specially, and apart from the provisions, if any of the relevant Jail Manual, imprisonment for life would mean, according to the rule in Gopal Vinayak Godse, imprisonment for the remainder of life. " We fail to see any departure from the ratio of Godse 's case; on the contrary the afore quoted passage clearly shows approval of that ratio and this becomes further clear from the final order passed by the Court while allowing the appeal/writ petition. The Court directed that the period of detention undergone by the two accused as undertrial prisoners would be set off against the sentence of life imprisonment imposed upon them, subject to the provisions contained in section 433A and, `provided that orders have been passed by the appropriate authority under section 433 of the Code of Criminal Procedure '. These directions make it clear beyond any manner of doubt that just as in the case of remissions so also in the case of set off the period of detention as undertrial would enure to the benefit of the convict provided the appropriate Government has chosen to pass an order under sections 432/433 of the Code. The ratio of Bhagirath 's case, therefore, does not run counter to the ratio of this Court in the case of Godse or Maru Ram. Under the Constitutional Scheme the President is the Chief Executive of the Union of India in whom the executive power of the Union vests. Similarly, the Governor is the Chief Executive of the 880 concerned State and in him vests the executive power of that State. Articles 72 and 161 confer the clemency power of pardon, etc., on the President and the State Governors, respectively. Needless to say that this constitutional power would override the statutory power contained in sections 432 and 433 and the limitation of section 433A of the Code as well as the power conferred by sections 54 and 55, IPC. No doubt, this power has to be exercised by the President/Governor on the advice of his Council of Ministers. How this power can be exercised consistently with Article 14 of the Constitution was one of the Questions which this Court was invited to decide in Maru Ram 's case. In order that there may not be allegations of arbitrary exercise of this power this Court observed at pages 1243 44 as under: "The proper thing to do, if Government is to keep faith with the founding fathers, is to make rules for its own guidance in the exercise of the pardon power keeping, ofcourse, a large residuary power to meet special situations or sudden developments. This will exclude the vice of discrimination such as may arise where two persons have been convicted and sentenced in the same case for the same degree of guilt but one is released and the other refused, for such irrelevant reasons as religion, caste, color or political loyalty. " Till such rules are framed this Court thought that extant remission rules framed under the or under any other similar legislation by the State Governments may provide effective guidelines of a recommendatory nature helpful to the Government to release the prisoner by remitting the remaining term. It was, therefore, suggested that the said rules and remission schemes be continued and benefit thereof be extended to all those who come within their purview. At the same time the Court was aware that special cases may require different considerations and `the wide power of executive clemency cannot be bound down even by self created rules '. Summing up its findings in paragraph 10 at page 1249, this Court observed: "We regard it as fair that until fresh rules are made in keeping with the experience gathered, current social conditions and accepted penological thinking a desirable step, in our view the present remissions and release schemes may usefully be taken as guidelines under ARticles 72/161 and orders for release passed. We cannot fault the Government, if in some intractably savage delinquents, section 881 433A is itself treated as a guideline for exercise of Articles 72/161. These observations of ours are recommendatory to avoid a hiatus, but it is for Government, Central or State, to decide whether and why the current Remission Rules should not survive until replaced by a more wholesome scheme. " It will be obvious from the above that the observations were purely recommendatory in nature. In Kehar Singh 's case on the question of laying down guidelines for the exercise of power under Article 72 of the Constitution this Court observed in paragraph 16 as under: "It seems to us that there is sufficient indication in the terms of Article 72 and in the history of the power enshrined in that provision as well as existing case law, and specific guidelines need not be spelled out. Indeed, it may not be possible to lay down any precise, clearly defined and sufficiently channelised guidelines, for we must remember that the power under Article 72 is of the widest amplitude, can contemplate a myriad kind of and categories of cases with facts and situations varying from case to case, in which the merits and reasons of State may be profoundly assisted by prevailing occasion and passing time. And it is of great significance that the function itself enjoys high status in the constitutional scheme. " These observations do indicate that the Constitution Bench which decided Kehar Singh 's case was of the view that the language of Article 72 itself provided sufficient guidelines for the exercise of power and having regard to its wide amplitude and the status of the function to be discharged thereunder, it was perhaps unnecessary to spell out specific guidelines since such guidelines may not be able to conceive of all myraid kinds and categories of cases which may come up for the exercise of such power. No doubt in Maru Ram 's case the Constitution Bench did recommend the framing of guidelines for the exercise of power under Articles 72/161 of the Constitution. But that was a mere recommendation and not a ratio decidendi having a binding effect on the Constitution Bench which decided Kehar Singh 's case. Therefore, the observation made by the Constitution Bench in Kehar Singh 's case does not upturn any ratio laid down in Maru Ram 's case. Nor has the Bench in Kehar Singh 's case said anything with regard to using the 882 provisions of extent Remission Rules as guidelines for the exercise of the clemency powers. It is true that Articles 72/161 make use of two expressions `remissions ' with regard to punishment and `remit ' in relation to sentence but we do not think it proper to express any opinion as to the content and amplitude of these two expressions in the abstract in the absence of a fact situation. We, therefore, express no opinion on this question formulated by the learned counsel for the petitioner. Lastly the learned counsel for the petitioner raised a hypothetical question whether it was permissible in law to grant conditional premature release to a life convict even before completion of 14 years of actual imprisonment, which release would tantamount to the prisoner serving time for the purpose of section 433A of the Code? It is difficult and indeed not advisable to answer such a hypothetical question without being fully aware of the nature of conditions imposed for release. We can do no better than quote the following observations made at page 1247 in Maru Ram 's case: ". . the expression `prison ' and `imprisonment ' must receive a wider connotation and include any place notified as such for detention purposes. `Stone walls and iron bars do not a prison make ': nor are `stone walls and iron bars ' a sine qua non to make a jail. Open jails are capital instances. any life under the control of the State whether within high walled or not may be a prison if the law regards it as such. House detentions, for example, Palaces, where Gandhiji was detained were prisons. Restraint on freedom under the prison law is the test. Licencsed where instant re capture is sanctioned by the law and likewise parole, where the parole is not free agent, and other categories under the invisible fetters of the prison law may legitimately be regarded as imprisonment. This point is necessary to be cleared even for computation of 14 years under section 433A. Therefore, in each case, the question whether the grant of conditional premature release answers the test laid down by this Court in the afore quoted passage, would depend on the nature of the conditions imposed and the circumstances in which the order is passed and is to be executed. No general observation can be made and we make none. 883 In paragraph 10 of the memorandum of the Writ petition. , three reasons have been assigned for invoking this Court 's jurisdiction under Article 32 of the Constitution, viz., (i) the questions involved in this petition will affect the right of a large body of life convicts seeking premature release; (ii) this Court 's judgment in Bhagirath 's case deviated from the ratio laid down in Godse 's case and, therefore, the entire law of remissions needed a review; and (iii) the High Court of Rajasthan had refused to examine the merits of the various important questions of law raised before it. It is on account of the fact that this petition was in the nature of a representative petition touching the rights of a large number of convicts of the categories referred to in section 433A of the Code, that we have dealt with the various questions of law in extenso. Otherwise the petition could have been disposed of on the narrow ground that even though in view of sections 433A of the Code, premature release could not be ordered under sections 432/433 of the Code read with the 1958 Rules until the petitioner had completed 14 years of actual imprisonment, his release could be considered in exercise of powers under Articles 72/161 of the Constitution treating the 1958 Rules guidelines, if necessary. The relief claimed in the petition is two fold, namely, (a) to grant a mandamus to the appropriate Government for the premature release of the petitioner by exercising constitutional power with the aid of 1958 Rules and (b) to declare the petitioner 's continued detention as illegal and void. The petitioner has not completed 14 years of actual incarceration and as such he cannot invoke sections 432 and 433 of the Code. His continued detention is consistent with section 433A of the Code and there is nothing on record to show that it is otherwise illegal and void. The outcome of his clemency application under the constitution is not put in issue in the present proceedings if it has been rejected and if the same is pending despite the directive of the High Court it would be open to the petitioner to approach the High Court for the compliance of its order. Under the circumstance no mandamus can issue. The writ petition must, therefore, fail. It is hereby dismissed. Rule discharged. G.N. Petition dismissed.

The petitioner was convicted for murder and sentenced to life imprisonment, which was confirmed by the High Court. Later he filed a Writ Petition before the High Court for premature release on the plea that he was entitled to be considered for release under the Rajasthan Prisons (Shortening of Sentences) Rules, 1958 notwithstanding the insertion of Section 433A in the Code of Criminal Procedure, 1973 with effect from 18.12.1978, just two days before his conviction. It was contended that Section 433A Cr. P.C. which places an embargo of 14 years imprisonment before premature release could not curtail the constitutional power vested in the Governor by virtue of Article 161 of the Constitution. The High Court, dismissed the Writ Petition on the ground that the petitioner 's representations to the Government and State Home Minister were pending consideration. However, the High Court directed that the two representations of the petitioner should be disposed of within one month. Unable to secure his release from the High Court as also from the State Government, the petitioner filed the present Write Petition before this Court, contending that the insertion of Section 433A in the Code of Criminal Procedure was invalid; that in the absence of guidelines under articles 72/161 of Constitution, Section 433A Cr. P.C. could not apply to life convicts; that the Rajasthan Prisons (Shortening of Sentences) Rules, 1958 would prevail over Section 433A Cr. P.C., and that the constitutional guarantee under Articles 14 and 21 was violated. Dismissing the Writ Petition, this Court HELD: 1.1. It is only when a legislature which has no power to legislate frames a legislation so camouflaging it as to appear to be within its competence when it knows it is not, it can be said that the legislation so enacted is colourable legislation. If in pith and substance the legislation does not belong to the subject falling within the limits of its power but is outside it, the mere form of the legislation will not be determinate of the legislative competence. [871C; 872C] 1.2. It is not a case of legislative incompetence to enact section 433A. No such contention was raised. Besides the question of vires of section 433A of the Code has been determined by the Constitution Bench of this Court in Maru Ram 's case. This Court Repelled all the thrusts aimed at challenging the constitutional validity of section 433A. [871A] 860 1.3. It is no body 's contention that Parliament was not competent to amend the Criminal Procedure Code by which section 433A was inserted. Whether or not the connecting Indian Penal Code (Amendment) Bill ought to have cleared or not was matter left to the wisdom of the Lok Sabha. Merely because the Criminal Procedure Bill was made law and the Indian Penal Code (Amendment) Bill was passed by the Rajya Sabha did not obligate the Lok Sabha to clear it. The Lok Sabha could have its own views on the proposed Indian Penal Code amendments. It may agree with the executive 's policy reflected in the Bill, with or without modifications, or not at all. Merely because in the subsequent instructions issued by the letter of July 10, 1979 and the accompanying note, the Joint Secretary had interlinked the two Bills, the Lok Sabha was under no obligation to adopt the measure as such representation could not operate as estoppel against it. It is obvious that no question of mala fides on the part of the legislature was involved in the enactment of one legislation and failure to enact another. There is no question of `legislative fraud ' or `colourbale legislation ' involved in the backdrop of the legislative history of section 433A of the Code of Criminal Procedure. [872D H; 873A] 1.4. In the present case if both the Bills had become law, then in understanding or construing one legislation or the other, the scheme common to both would be kept in view and be permitted to interact. But where the linkage does not exist on account of the Indian Penal Code (Amendment) Bill not having become law, section 433A cannot be read down to apply to only those classes of capital offences to which it would have applied had the said Bill been passed by the Lok Sabha in the terms in which it was approved by the Rajya Sabha. The language of section 433A is clear and unambiguous and does not call for extrinsic aid for its interpretation. To read down or interpret section 433A of the Code with the aid of the changes proposed by the Indian Penal Code (Amendment) Bill would tantamount to treating the said Bills forming part of the Indian Penal Code, which is clearly impermissible. To put such an interpretation with the aid of such extrinsic material would result in violence to the plain language of section 433A of the Code. [873D F] Maru Ram vs Union of India, ; , followed. K.C. Gajapati Narayan Deo vs State of Orissa, ; and Sonapur Tea Co. Ltd. vs Must Mariruznessa, ; , relied on. 861 State of Himachal Pradesh vs A Parent of a student of Medical College, Simla, [1985] 3 SCC 169 and W.R. Moram vs Deputy Commissioner of Taxation for N.S.W., , referred to. The law governing suspension, remission and commutation of sentence is both statutory and constitutional. The stage for the exercise of this power generally speaking is post judicial, i.e., after the judicial process has come to an end. The duty to judge and to award appropriate punishment to the guilty is a judicial function which culminates by a judgment pronounced in accordance with law. After the judicial function thus ends the executive function of giving effect to the judicial verdict commences. [873G H; 874A] 2.2. One who could have been visited with the extreme punishment of death but on account of the sentencing court 's generosity was sentenced to the lesser punishment of imprisonment for life and another who actually was sentenced to death but on account of executive generosity his sentence was commuted under section 433(a) for imprisonment for life have been treated under section 433A as belonging to that class of prisoners who do not deserve to be released unless they have completed 14 Years of actual incarceration. Thus, the effect of section 433A is to restrict the exercise of power under sections 432 and 433 by the stipulation that the power will not be so exercised as would enable the two categories of convicts referred to in section 433A to freedom before they have completed 14 years of actual imprisonment. This is the legislative policy which is clearly discernible from the plain language of section 433A of the Code. Such prisoners constitute a single class and have, therefore, been subjected to the uniform requirement of suffering atleast 14 years of internment. [874G H; 875A C] 3. The expression `life imprisonment ' must be read in the context of section 45 IPC. Read so, it would ordinarily mean imprisonment for the full or complete span of life. Section 65, 116, 120 and 511 of the Indian Penal Code fix the term of imprisonment thereunder as a fraction of the maximum fixed for the principal offence. It is for the purpose of working out this fraction that it became necessary to provide under section 57 that imprisonment for life shall be reckoned as equivalent to imprisonment for 20 years. If such a provision had not been made it would have been impossible to work out the fraction of an indefinite term. In order to work out the fraction of terms of punishment provided in the above sections it was imperative to lay down the equivalent term for life imprisonment. [875G; 876C E] 862 Gopal Goads vs State of Maharashtra, ; ; affirmed. 4.1 Unless the sentence for life imprisonment is commuted or remitted by the appropriate authority under the provisions of the relevant law, a convict is bound in law to serve the entire life term in prison; the rules framed under the Prisons Act or life statute may enable such a convict to earn remissions but such remissions will not entitle him to release before he has completed 14 years of incarceration in view of section 433A of the Code unless of course power has been exercised under Article 72/161 of the Constitution. Where a person has been sentenced to imprisonment for life the remissions earned by him during his internment in prison under the relevant remission rules have a limited scope and must be confined to the scope and ambit of the said rules and do not acquire significance until the sentence is remitted under section 432, in which case the remission would be subject to limitation of section 433A of the Code, or constitutional power has been exercised under Articles 72/161 of the Constitution. [878D E] 4.2. Articles 72 and 161 confer the clemency power of pardon, etc., on the President and the State Governors, respectively. This constitutional power would override the statutory power contained in sections 432 and 433 and the limitation of section 433A of the Code as well as the power conferred by sections 54 and 55 IPC. No doubt, this power has to be exercised by the President/Governor on the advice of his Council of Ministers. [880A B] 4.3. Though in Maru Ram 's case, this Court recommended the framing of guidelines for the exercise of power under Articles 72/161 of the Constitution of India, it had no binding effect on the Constitution Bench which decided Kehar Singh 's case. Nor has this Court said anything in Kehar Singh 's case with regard to using the provisions of extent Remission Rules as guidelines for the exercise of clemency powers. [881H; 882A] Maru Ram vs Union of India, ; ; Kehar Singh vs Union of India, ; ; Bhagirath vs Delhi Administration; , and Gopal Godse vs State of Maharashtra; , , affirmed. It is true that Articles 72/161 make use of two expressions `remissions ' with regard to punishment and `remit ' in relation to sentence but it is not proper to express any opinion as to the content and amplitude of these two expressions in the abstract, in the absence of a fact situation. [882B] 863 6.1 The hypothetical question whether it was permissible in law to grant conditional premature release to a life convict even before completion of 14 years of actual imprisonment, which release would tantamount to the prisoner serving time for the purpose of section 433A Cr. P.C., need not be answered without being fully aware of the conditions imposed for release. In each case, the question whether the grant of conditional premature release answers the test laid down by this Court in Maru Ram 's case, would depend on the nature of the conditions imposed and the circumstances in which the order is passed and is to be executed. No general observation can be made. [882C H] Maru Ram vs Union of India, ; ; referred to. In the instant case, petitioner has not completed 14 years of actual incarceration and as such he cannot invoke sections 43 and 433 of the Code of Criminal Procedure. His continued detention is consistent with section 433A of the Code and there is nothing on record to show that it is otherwise illegal and void. The outcome of his clemency application under the Constitution is not put in issue in the present proceedings if it has been rejected, and if the same is pending despite the directive of the High Court it would be open to the petitioner to approach the High Court for the compliance of its order. [883E F]

l Appeal c, No. 380 of 1957. Appeal from the judgment and order dated March 8, 1956, of the Bombay High Court in Income tax Reference No. 4 of 1956. N. A. Palkhivala, section N. Andley, Rameshwar Nath, J. B. Dadachanji and P. L. Vohra, for the appellant. A. N. Kripal and D. Gupta, for the respondent. December 7. The Judgment of the Court was delivered by HIDAYATULLAH, J. This appeal, on a certificate by the High Court, has been filed by Shree Changdeo Sugar Mills, Ltd., to which section 23A of the Income tax Act (prior to its amendment by the Finance Act, 1955) was applied in respect of the assessment year, 1948 49. The question which was referred to the High Court was whether at the relevant time the assessee Company could be deemed to be a Company, in which the public were substantially interested. This question was answered in the negative by the High Court. During the assessment year, the Company had not distributed dividends to the extent of 60 per cent. of its profits, and an order under section 23A(1) of the Indian Income tax Act was passed by the Income tax Officer. The Company appealed to the Appellate Assistant Commissioner, who dismissed the appeal. It next appealed to the Tribunal, but was unsuccessful. The Tribunal, however, referred the above question which, as already stated, was answered in the negative by the High Court. The issued, subscribed and paid up capital of the assessee Company consisted of 60,000 shares, which were distributed as follows: 992 (1) 11 Directors of the Company 41,500 shares. (2) The Managing Agency Firm 2,300 shares. (3) Mysore Merchants Ltd. 11,880 shares. (4) Others. . 4,320 shares. 60,000 shares. The question arose in determining whether the public were substantially interested in the Company, that is to say, held 25 per cent. of the voting power. The Bombay High Court in determining this point followed its decision in Raghuvanshi Mills V. Commissioner of Income tax (1), and held that no holding by the Directors of a company could be regarded as one in which the public were substantially interested. We have heard Civil Appeal No. 30 of 1957 from the decision of the Bombay High Court in the Raghuvanshi Mills case (1), in which judgment has been pronounced today, and have held that that is not the correct test to apply. We have remanded the said appeal, after setting out the correct test to apply. What we have said there applies equally here. There is yet another question, which arose in this appeal but not in the appeal of the Raghuvanshi Mills. As we have already stated, Mysore Merchants Ltd., held 11,880 shares of the assessee Company. If these shares could be said to be held by the public along with 4,320 shares, the public would be holding 25 per cent of the voting power, whether or not the Directors of the Company held the rest of the shares. It was. , therefore, necessary for the High Court to consider whether the shares held by Mysore Merchants 'Ltd., could be said to be held by the public. The High Court held against the assessee Company that they could not be counted as part of the holding by the public, and, in our judgment, the High Court has reached the correct conclusion. The matter has to be judged under the third proviso to section 23A(1), which read as follows: "Provided further that this sub section shall not apply to any company in which the public are (1) 993 substantially interested or to a subsidiary company of such a company if the whole of the share capital of such subsidiary company is held by the parent company or by the nominees thereof. Explanation. For the purpose of this sub section, a company shall be deemed to be a company in which the public are substantially interested if shares of the company (not being shares entitled to a fixed rate of dividend, whether with or without a further right to participate in profits) carrying not less than twenty five per cent of the voting power have been allotted unconditionally to, or acquired unconditio nally by, and are at the end of the previous year beneficially held by, the public (not including a company to which the provisions of this sub section apply), and if any such shares have in the course of such previous year been the subject of dealings in any stock exchange in British India or are in fact freely transferable by the holders to other members of the public. " In applying the proviso and the Explanation, we have to give effect to the words "not including a company to which the provisions of this sub section apply", and have to determine whether Mysore Merchants Ltd., is a Company, to which the provisions of section 23A can be said to be applicable. Learned counsel for the assessee Company contends that in deciding this, we have to be satisfied on three points, which he summarises as follows: (a)The public should not be substantially interested in that Company; (b)It must have assessable profits for the relevant assessment year; and (c)It must not have distributed 60 per cent of its net assessable profits. He contends that unless these three conditions are fulfiled, section 23A will not apply to Mysore Merchants Ltd., and that the shares held by it will be deemed to be held by the public. He points out that Mysore Merchants Ltd., had no assessable income in the corresponding assessment year and had suffered a loss, that conditions (b) and (c) did not, therefore, apply, and 994 that section 23A is not applicable to that Company. In our opinion, the paramount condition is that even in that Company the public should be beneficially interested in 25 per cent. of the voting power, and it was admitted before us that it was not a public Company at all but a private Company, and that, therefore, the public were not interested in that Company. The shares held by Mysore Merchants Ltd., cannot at all be counted as a holding in which the public are beneficially interested, in view of the exclusion contained in the Explanation. This point will not, therefore, be open for the determination of the High Court, when the question is reconsidered by the High Court in the light of our observations in The Raghuvanshi Mills.Ltd. vs Commissioner of Income tax, Bombay (1), decided today. Learned counsel for the assessee Company also contended that in view of cl. 14 of the Part B States (Taxation Concessions) Order, 1950, the provisions of section 23A could not be applied to Mysore Merchants Ltd. That clause reads as follows: " 14. Requiring distribution of dividends by private companies. The provisions of section 23A of the Act shall not be applied in respect of the profits and gains of any previous year ending before the appointed day unless the State law contained a provision corresponding thereto. " This Concession would be open to Mysore Merchants Ltd., if it satisfied the terms of Cl. That, however, cannot detract from the application of section 23A to determine whether the shares hold by it can be described as those in which the public are beneficially interested in another company. The Explanation requires that the shares held by a company should be considered as held by the public, only if section 23A does not apply to it. The Concessions Order does not seek to negative this test; it only confers a benefit on a company, to which cl. 14 applies. Mysore Merchants Ltd., may be able to avail of that concession, and still fall within (1) ; 995 section 23A for other purposes. This contention has no force. The appeal is allowed, and the case is remitted to s the High Court for deciding the question in the light of the observations in our decision in the Raghuvanshi Mills case (1). As the case is remanded, the costs of this appeal shall be paid by the respondent, but the costs in the High Court will abide the result. Appeal allowed.

During the assessment year, the company had not distributed dividends to the extent of 60% of its profits and an order under section 23A(1) of the Act was passed by the Income tax Officer. The question referred by the Tribunal to the High Court was whether at the relevant time the assessee company could be deemed to be a company in which the public were substantially interested, i.e., held 25% of the voting power, was answered in the negative. Held, that the test that no holding by the Directors of a company could be regarded as one in which the public were substantially interested was not the correct test to apply. The test as laid down in Raghuvanshi Mills vs Commissioner of Income tax, ; , would apply to this Case. Held, further, that the paramount condition in applying the proviso and the explanation of section 23A(1) was that the public should be beneficially interested in 25% of the voting power. , The explanation to section 23A required that shares held by the company should be considered as held by the public, only if section 23A did not apply to it. The concession order in cl. 14 of the; Part B States (Taxation Concession) Order, 1950, did not seek to negative that test, it only conferred a benefit on a company, 991 to which cl. 14 applied, and the company could avail that concession, and still might fall within section 23A for other purposes. The Raghuvanshi Mills Ltd. vs Commissioner of Income tax, SI ' Bombay, ; , applied.

Appeal No. 541 of 1962. Appeal by special leave from the judgment and order dated May 31, 1962, of the Punjab High Court (Circuit Bench) at Delhi in section A. O. No. 86 D of 1962. A.S. B. Chari, M. K. Ramamurthi, D. P. Singh and B. K. Garg, for the appellant. G. section Pathak, F. C. Bedi and D. D. Sharma, for respondents. December 17. The judgment of the Court was delivered by SINHA, C. J. This appeal by special leave is directed against the judgment and order of a learned single judge of the Punjab High Court summarily dismissing the appeal filed by the appellant, by his order dated May 31, 1962, from the order of the Rent Control Tribunal dated March 7, 1962, con firming that of the Additional Rent Controller, Delhi, dated July 27, 1961, whereby he had directed the appellant to be evicted from the premises in question. It appears that the respondents are admittedly the landlords of the premises, No. 24, Ansari Road, Darya Ganj, Delhi. The appellant claims to have been in occupation of the premises since prior to 1950, at a monthly rent of Rs. 50/ . In 1955, the respondent had instituted a suit for the eviction of the All India Postal & R.M.S. Union, and the appellant was also impleaded as a party to the suit. The respondents, in 1958, made an application for amendment of the plaint on the ground that they had come to know that the last owner, the father of the first respondent, had let the building to the appellant for his residential purposes and that the case should proceed againt him only. But the 262 Subordinate judge, before whom the suit was pending, did not permit the amendment of the plaint but granted permission to withdraw from the suit with liberty to bring a fresh one, by his order dated May 8, 1959. Thereafter, on February 25, 1960, the respondents made an application before the Rent Controller, Delhi, for the eviction of the appellant alone, without impleading the Union aforesaid as a party: The contention of the appellant was that the premises had been let out by the father of the first plaintiff respondent to the All India Postal & R.M.S. Union for office cum residential purposes and the tenancy of the Union had never been terminated. The appellant also alleged that he was not a tenant and, therefore, the application for his eviction was not maintainable. The petition for eviction was founded on the allegation that the appellant as tenant had made persistent default in the payment of rent and, secondly, that the premises were bonafide required by the respondents for their own residence, as the first respondent was about to leave the employment of a certain hospital which had provided him with residential accommodation. That is to say,the petition for eviction was brought under s.14(1)(a) & (e) of the Delhi Rent Control Act (LIX of 1958)which will be referred to in the course of the judgment as the Act. The appellant besides denying his tenancy and asserting the tenancy of the Union aforesaid stated that the respondents had already got suitable accommodation and that their requirement of the premises in question was not bonafide; the notice of demand for payment of rent served on the appellant was neither valid nor proper in law inasmuch as he was not the tenant in respect of the premises, and that the notice of demand should have been served on the Union. The appellant asserted that he was only a licensee of the Union, and that there was no relationship of landlord and tenant between him and the respondents. On April 2, 1960, the Additional Rent Controller passed an order 263 directing the appellant to deposit the arrears of rent from August 1,1958, up to date, at the rate of Rs. 50/ per month, and future monthly rent, month by month, by the 15th of every following month. The respondents made an application on May 16, 1961, under section 15(7) of the Act for striking out his defence against eviction on the ground that the tenant had failed to make the payment or deposit, as directed by the order dated April 2, 1960, aforesaid. The appellant denied that he had made any default in the regular payment of rent, but also asserted that if there was any such default it was not intentional and was the result of a miscalculation. By his order dated July 26, 1961, the Additional Rent Controller ordered the defence of the appellant to be struck out. An appeal against the order striking out his defence was made to the Rent Control Tribunal on September 15, 1961, which was late by one day. The learned Tribunal dismissed the appeal as time barred, as also on merits, by its order dated March 6, 1962. By his order dated July 17 , 1961, the Additional Rent Controller passed an ex parte order of,ejectment against the appellant holding that prima facie the relationship of landlord and tenant had been established, on the basis of certain rent receipts granted by the respondents to the appellant. He also held that the respondents ' personal bonafide need for accommodation had been established. Appeal against that order was dismissed on March 7, 1962, by the Rent Control Tribunal. On May 28, 1962, the appellant filed a second appeal in the High Court of Punjab at Delhi against the order dated March .7, 1962, of the Rent Control Tribunal, dismissing his appeal against the order of eviction. No second appeal was taken to the High Court in respect of the dismissal of the appeal relating to the order dated March 6, 1962, of the Rent Control Tribunal dismissing his appeal in respect of the order of the Additional Rent Controller striking out his defence. The second appeal was dismissed summarily by a 264 Single judge on May 31, 1962. The appellant moved this Court during the long vacation and obtained an order from the learned Vacation judge granting special leave to appeal, on June 5, 1962. A preliminary objection was taken on behalf of the landlord respondent that no second appeal having been filed againts the order aforesaid of the Rent Control Tribunal, dismissing his appeal in respect of the order of the Additional Rent Controller striking out his defence, that order had become final between the parties, and, therefore, this appeal was incompetent. As will presently appear, this question is bound up with merits of the appeal and has, therefore, to be determined not as a preliminary objection but as one of the contentions between the parties, on the merits of the appeal itself. It was argued on behalf of the appellant that the authorities under the Act had no jurisdiction to entertain the proceedings, inasmuch as it was denied that there was any relationship of landlord and tenant between the parties. Consequently, it was further contended, the provisions of section 15 (7) of the Act could not be applied against the appellant in the absence of a finding that he was the tenant in respect of the premises in question. It was also contended that the delay of one day made in preferring the appeal to the Rent Control Tribunal should have been condoned, and the order refusing condonation was vitiated by applying erroneous considerations. Other contentions raised related to concurrent findings of fact of the Rent Controller and the Rent Control Tribunal and we need not, therefore, take notice of these arguments. The most important question that arises for determination in this case is whether or not the Rent Control authorities had jurisdiction in the matter in controversy in this case. Ordinarily it is for the Civil Courts to determine whether and, if so, what jural relationship exists between the litigating 265 parties. But the Act has been enacted to provide for the control of rents and evictions of tenants, avowedly for their benefit and protection. The Act postulates the relationship of landlord and tenant which must be a preexisting relationship. The Act is directed to control some of the terms and incidents of that relationship. Hence, there is no express provision in the Act empowering the controller, or the Tribunal, to determine whether or not there is a relationship of landlord and tenant. Inmost cases such a question would not arise for determination by the authorities under the Act. A landlord must be very ill advised to start proceedings under the Act, if there is no such relationship of landlord and tenant. If a person in possession of the premises is not a tenant, the owner of the premises would be entitled to institute a suit for ejectment in the Civil Courts, untrammelled by the provisions of the Act. It is only when he happens to be the tenant of premises in an urban area that the provisions of the Act,are attracted. If a person moves a Controller for eviction of a person on the ground that he is a tenant who had, by his acts or omissions, made himself liable to be evicted on any one of the grounds for eviction, and if the tenant denies that the plaintiff is the landlord, the Controller has to decide the question whether there was a relationship of landlord and tenant. If the Controller decides that there is no such relationship the proceeding has to be terminated, without deciding the main question in controversy, namely the question of eviction. If on the other hand, the Controller comes to the opposite conclusion and holds that the person seeking eviction was the landlord and the person in possession was the tenant the proceedings have to go on. Under section 15 (4) of the Act, the Controller is authorised to decide the question whether the claimant was entitled to an order for payment of rent, and if there is a dispute as to the person or persons to whom the rent is payable, he may direct the tenant to deposit with him the 266 amount payable until the decision of the question as to who is entitled to that payment. "Landlord" has been defined under the Act as a person who is receiver or is entitled to receive the rent of the premises (omitting the words not necessary for our present purposes). If the Controller comes to the conclusion that any dispute raised by the tenant as to who was entitled to receive rent had been raised by the tenant for false or frivolous reasons, he may order the defence against eviction to be struck out (section 15 (5)). Similarly, if a tenant fails to make payment or deposit as required by section 15 (2), the Controller may order the defence against eviction to be struck out and proceed with the hearing of the application for eviction (section 15 (7)). Such an order was, as already indicated, passed by the Rent Controller in this case. Now, proceedings under section 15 are primarily meant for the benefit of the tenant, and the section authorises the Controller after giving the parties an opportunity of being heard, to make an order directing the tenant to pay the amount found on calculation to be due to the landlord or to deposit it with the Controller, within one month of the date of the order. Such an order can be passed by the Controller for the benefit of the tenant, only if the Controller decides that the person against whom the proceedings for eviction had been initiated was in the position of a tenant. Thus, any order passed by the Controller, either under section 15 or other sections of the Act, assumes that the Controller has the jurisdiction to make the order, i. e., to determine the issue of relation ship. In this case, when the Controller made the order for deposit of the arrears of rent due, under section 15 (1), and on default of that made the order under sub section (7) of section 15, striking out the defence, the Controller must be deemed to have decided that the appellant was a tenant. Such a decision may not be res judicata in a regular suit in which a similar issue may directly arise for decision. Hence, 267 any orders made by a Controller under the Act proceed on the assumption that he has the necessary power to do so under the provisions of the Act, which apply and which are meant to Control rents and evictions of tenants. An order under section 15 (1) is meant primarily for the protection and benefit of the tenant. If the appellant took his stand upon the plea that he was not a tenant he should have simply denied the relationship and walked out of the proceedings. Instead of that, he took active steps to get the protection against eviction afforded by Act, by having an order passed by the Controller, giving him a locus poenitentiae by allowing further time to make the deposit of rent outstanding against him. The Controller, therefore, must be taken to have decided that there was a relationship of landlord and tenant between the parties, and secondly, that the tenant was entitled to the protection under the Act. It is true that the Act does not in terms authorise the authorities under the Act to determine finally the question of the relationship of landlord and tenant. The Act proceeds on the assumption that there is such a relationship. If the relationship is denied, the authorities under the Act have to determine that question also, because a simple denial of the relationship cannot oust the jurisdiction of the tribunals under the Act. True, they are tribunals of the limited jurisdiction, the scope of their power and authority being limited by the provisions of the Statute. But a simple denial of the relationship either by the alleged landlord or by the alleged tenant would not have the effect of ousting the jurisdiction of the authorities under the Act, because the simplest thing in the world would be for the party interested to block the proceedings under the Act to deny the relationship of landlord and tenant. The tribunals under the Act being creatures of the Statute have limited jurisdiction and have to function within the four corners of the Statute creating them. But within the provisions 268 of the Act, they are tribunals of exclusive jurisdiction and their orders are final and not liable to be questioned in collateral proceedings like a separate suit or application in execution proceedings. In our opinion, therefore, there is no substance in the contention that as soon as the appellant denied the relationship of landlord and tenant; the jurisdiction of the authorities under the Act was completely ousted. Nor is there any jurisdiction in the contention that the provisions of sub section (7) of section 15 of the Act had been erroneously applied to the appellant. The orders under those provisions were for his benefit and he must be deemed to have invited the Controller to pass those orders in his favour. Otherwise, he should have walked out of the proceedings after intimating to the Controller that he was not interested to contest the proceedings in as much as he was not a tenant, and that a third party was the tenant. This order, of course, will bind only the appellant and no one else, and as he failed to take advantage of the order passed in his favour under section 15 (7), he cannot make a grievance of it. Whether or not a delay of one day should have been condoned was a matter of discretion with the appellate authority, and it is not for this Court to say that this discretion should have been exercised in one way and not in another. The crucial question is not whether the delay is of one day or more, but whether or not there was any justification for the delay. It is for the appellate authority to determine whether or not the appellant had satisfied it as to the sufficiency of the ground for condoning the delay. This question of condonation of delay is more or less of academic interest only, because the Tribunal not only considered the question of delay but also the appeal on its merits, and on merits also it came to the conclusion that there was no ground for interference with the orders passed by the Rent Controller. Hence, the question of condonation of delay is of no importance in this case. What is of greater importance is the 269 merit of the decision awarding possession to the landlord. In this connection, it may be added that it was a little inconsistent on the part of the appellant to have taken all the advantages the Act affords to a tenant and then to turn round and to assert that the Rent Controller had no jurisdiction in the matter, because he was not. the tenant. The Rent Controller had to determine the controversy as between the parties for the purposes of disposing of the case under the Act. If the appellant really was a tenant, he has had the benefit of the provision of the Act, including the six months ' time as a period of grace after an order of the Rent Controller granting the landlord 's prayer for eviction. If he was not the tenant, he has nothing to lose by the order of the Rent Controller. These proceedings cannot affect the interest of one who is not a party to the present case. Furthermore, a second appeal lay from the appellate order of the Rent Control Tribunal dismissing the appellant 's appeal against the order striking out his defence. No such second appeal was taken to the High Court, though as already stated a second appeal was preferred against the order of the Rent Control Tribunal dismissing his appeal against the order of eviction. The position is that the appellate order of the Rent Control Tribunal, dated March 6, 1962, dismissing the appeal against the order striking out his defence became final between the parties and is no more open to challenge. Hence, it is no more open to the appellant to challenge the jurisdiction of the authorities under the Act. In our opinion, therefore, there is no merit in his appeal. It is accordingly dismissed with costs. Appeal dismissed.

The appellant was sought to be evicted by the landlord on the ground that he had habitually defaulted in the payment of rent as well as on the ground of the bonafide requirement of the land lord for his own occupation. He resisted the suit inter alia on the ground that the premises had been let to the 260 All India Postal R. M. section Union for office cum residential purposes and that the tenancy of the Union had not been terminated and that the rent had not been demanded from the Union. The appellant was directed to deposit the arrears of rent up to date as also to go on depositing the future rent accruing due month by month. The respondent applied under section 15(7) of the Act for striking out the defence of the appellant on the ground that he had failed to comply with the orders directing him to deposit the rent. Rejecting the explanation of the appellant the Additional Rent Controller ordered the defence of the appellant to be struck out on July 26, 1961, and proceeded to pass an ex parte decree for eviction. The appellant went in appeal against the order striking out the defence which was dismissed by the Rent Control Tribunal both on the ground that it was barred by time as also on merits on March 6, 1961. The appellant did not take the matter in further appeal to the High Court. Against the decree for eviction the appellant went to the Rent Control Tribunal which dismissed the appeal. The appellant went in further appeal to the High Court which also dismissed the appeal summarily. On special leave, it was contended that the appellant having denied the existence of the relationship of landlord and tenant, the Rent Controller had no jurisdiction in the matter. Held, that under the Rent Control Law, the special tribunal has to proceed on the basis of the relationship of landlord and tenant existing between the parties but a mere denial by the tenant of the tenancy would not suffice to oust the jurisdiction of the special tribunal. It is only when the tribunal comes to the conclusion that such a relationship did not exist that it will have no jurisdiction. Held, further, that the provisions of section 15 read with the definition of "landlord" enable the Rent Controller to determine the question of the relationship of landlord and tenant for the benefit of the tenant and when a party has invited the Rent Controller to apply the provisions of section 15 for his benefit and the Rent Controller does so, he is deemed to have decided such a person is a tenant. The proper course for a person pleading that he was not a tenant would be to raise the plea and walk out of the proceedings and not to submit to jurisdiction. Held, further, that the appellant not having taken the matter of striking out his defence under section 15 (7) in appeal to the High Court the question of his being a tenant or otherwise had become final and could not be reagitated.

minal Delhi Appeal Nos. 7 to 9 of 1961. Appeals by special leave from the judgment and order dated January 2, 1961, of the Punjab High Court (Circuit Bench) at Delhi in Criminal Appeals Nos. 464 C, 465 C and 463 D of 1959. Dingle Foot, D. R. Prem, section M. Sikri, G. H.Jauhari and A. N. Goyal, for the appellant (in Cr. A. No. 7 of 61). R. L. Kohli and A. N. Goyal, for the appellant (in Cr. A. No. 8 of 1961). Prem Nath Chadha, Madan Gopal Gupta and R. Choudhri, for appellant No. 2 (in Cr. A. No. 9 of 1961). C. K. Daphtary, Solicitor General of India, R. L. Mehta and R. H. Dhebar, for the respondents. April 5. The Judgment of the Court was delivered by RAGHUBAR DAYAL, J. These three appeals are by special leave. Appeal No. 7 of 1961 is by R. K. Dalmia. Appeal No. 8 of 1961 is by R.P.Gurha. Appeal No. 9 of 1961 is by G.L.Chokhani and Vishnu Prasad. All the appellants were convicted of the offence under section 120 read with s.409 I.P.C., and all of them, except Vishnu Prasad, were also convicted of certain offences arising out of the overt acts committed by them. Dalmia and Chokhani were convicted under section 409 I.P.C. Chokhani was also convicted under section 477A read with section 110, I. P. C. Gurha was convicted under section 477A I. P. C. To appreciate the case against the appellants, we may first state generally the facts leading to the case. Bharat Insuirance Company was incorporated 258 in 1896. In 1936, Dalmia purchased certain shares of the company and became a Director and Chairman of the company. He resigned from these offices in 1942 and was succeeded by his brother J. Dalmia. The head office of the Bharat Insurance Company was shifted from Lahore to 10, Daryaganj, Delhi. in 1947. Dalmia was co opted a Director on March 1.0, 1949 and was again elected Chairman of the company on March 19, 1949 when his brother J. Dalmia resigned. R. L. Chordia, a relation of Dalmia and principal Officer of the Insurance Company, was appointed Managing Director on February 27, 1950. Dalmia was appointed Principal Officer of the company with effect from August 20, 1954. He remained the Chairman and Principal Officer of the Company till September 22, 1955. The period of criminal conspiracy charged against the appellant is from August 1954 to September 1955. Dalmia was therefore, during the relevant period, both Chairman and Principal Officer of the Insurance Company. During this relevant period, this company had its current account in the Chartered Bank of India, Australia and China Ltd. (hereinafter called the Chartered Bank) at Bombay. The Company also had an account with this bank for the safe custody of its securities the company also had a separate current account with the Punjab National Bank, Bombay. At Delhi, where the head office was, the company had an account for the safe custody of securities with the Imperial Bank of India, New Delhi. Exhibit P 785 consists of the Memorandum of Association and the Articles of Association of the Bharat Insurance Company. Articles 116 and 117 deal with the powers of the Directors. Exhibit P 786 is said to be the original Byelaws passed by the Directors on September 8, 1951. 259 The pages are signed by K.L. Gupta, who was the General Manager of the company during, the relevant period, and not by Dalmia the Chairman, as De should have been the case in view of the resolution dated May 8, 1951. The genuineness of this document is not, however, admitted. Exhibits P 15 and P 897 are said to be copies of these Bye laws which were sent to Shri K. Annadhanam (Chartered Accountant, appointed by the Government of India on September 19, 1955, to investigate into the affairs of the Bharat Insurance Company under section 33(1) of the ) and to the Imperial Bank of India, Now Delhi, respectively, and the evidence about their genuineness is questioned. Bye law 12 deals with the powers of the Chairman. Clause (b)) thereof empowers the Chairman to grant loans to persons with or without security, but from August 30, 1954, the power was restricted to grant of loans on mortgages. Clause (e) empowers the Chairman to negotiate transfer buy and sell Government Securities and to pledge, indorse, withdraw or otherwise deal with them. On January 31, 1951, the Board of Directors of the Insurance Company passed resolutions to the following effect : (1) To open an account in the Chartered Bank at Bombay. (2) To authorise Chokhani to operate on the account of the Insurance Company. (3) To for the keeping of the Government securities had by the company, in safe custody, with the Chartered Bank. (4) To instruct the Bank to accept institutions with regard to withdrawal from Chokhani and Chordia. On the same day, Dalmia and Chordia made an application for the opening of the account at Bombay with the result that Current Account No. 1120 was opened. On the same day Chokhani was appointed Agent of the company at Bombay. 260 He was its agent during the relevant period. From 1951 to 1953, Chokhani alone operated ' on that account. On October 1, 1953, the Board of Directors directed that the current account of the company with the Chartered Bank, Bombay, be operated jointly by Chokhani and Raghunath Rai, P.W. 4. Ragbunath Rai, joined the company in 1921 as a Clerk, became Chief Accountant in 1940 and Secretary cum Chief Accountant of the company from August 17, 1954. The modus operandi of the joint operation of the bank account by Chokhani and Raghunath Rai amounted, in practice to Chokbani 's operating that account alone. Chokbani used to get a number of blank cheques signed by Raghunath Rai, who worked at Delhi. Chokhani signed those cheques when actually issued. In order to have signed cheques in possession whenever needed, two cheque books were used. When the signed cheques were nearing depletion in one cheque book, Chokhani would send the other cheque book to Raghunath Rai for signing again a number of cheques. Thus Raghunath Rai did not actually know when and to whom and for what amount the cheques would be actually issued and therefore, so far as the company was concerned, the real operation of its banking account was done by Chokhani alone. This system led to the use of the company 's funds for unauthorized purposes. Chokhani used to purchase and sell securities on behalf of the company at Bombay. Most of the securities were sent to Delhi and kept with the Imperial Bank of India there. The other securities remained at Bombay and were kept with the Chartered Bank. Sometimes securities were kept with the Reserve Bank of India and inscribed stock was obtained instead. The presence, of the inscribed stock was a guarantee that the securities were, in the Bank. 261 Chokhani was not empowered by any resolution of the Board of Directors to purchase and sell securities. According to the prosecution, he purchased and sold securities under the instructions of Dalmia. Dalmia and Chokhani state that Dalmia had authorised Chokhani in general to purchase and sell securities and that it was in pursuance of such authorisation that Chokhani on his own purchased and sold securities without any further reference to Dalmia or further instructions from Dalmia. The transactions which have given rise to the present proceedings against the appellants consisted of purchase of securities for this company and sale of ' the securities which the company held. The transactions were conducted through recognised brokers and ostensibly were normal transactions. The misappropriation of funds of the company arose in this way. Chokhani entered into a transaction of purchase of securities with a broker. The broker entered into a transaction of purchase of the same securities from a company named Bhagwati Trading Company which was owned by Vishnu Prasad, appellant, nephew of Chokhani and aged about 19 years in 1954. The entire business for Bhagwati Trading Company was really conducted by Chokhani. The securities purchased were not delivered by the brokers to Chokhani. It is said that Chokhani instructed the brokers that he would have the securities from Bhagwati Trading, Company. The fact, however, Chokhani however was that Bhagwati Trading Company did not deliver the securities. Chokhani however issued cheques in payment of the purchase price of the securities to Bhagwati Trading Company. Thus, the amount of the cheques was paid out of the company 's funds without any gain to it. The sale transactions consisted in the sale of the securities held or supposed to be held by the company to a broker and the price obtained from 262 the sale was unutilised in purchasing formally further securities which were not received: The purchase transaction followed the same pattern, viz., Chokhani purchased for the company from a broker, the broker purchased the same securities from Bhagwati Trading Company and the delivery of the securities was agreed to be given by Bhagwati Trading Company to Chokhani. Bhagwati Trading Company did not deliver the securities but received the price from the Insurance Company. In a few cases, securities so purchased and not received were received later when fresh genuine purchase of similar securities took place from the funds of the Bharat Union Agencies or Bhagwati Trading Company. These securities were got endorsed in favour of the Insurance Company. The funds of the company, ostensibly spent on the purchase of securities, ultimately reached another company the Bharat Union Agencies. Bharat Union Agencies ( hereinafter referred to as the Union Agencies) was a company which dealt in speculation in shares and, according to the prosecution was practically owned by Dalmia who held its shares either in his own names or in the names of persons or firms connected with him. The Union Agencies suffered Icsses in the relevant period from August 1954 to September, 1955. The prosecution case is that to provide funds for the payment of these losses at the due time, the accused persons entered into the conspiracy for the diversion of the funds of the Insurance Company to the Union Agencies. To cover up this unauthorised transfer of funds, the various steps for the transfer of funds from one company to the other and the falsification of accounts of the Insurance Company and the Union Agencies took place and this conduct of the accused gave rise to the various offences they were charged With and convicted of. 263 The real nature of the sale and ' purchase transactions of the securities did not come to the notice of the head office of the Insurance Company at Delhi as Chokhani communicated to the head office the contracts of sale and purchase with the brokers ' statements of accounts, with a covering letter stating the purchase of securities from the brokers, without mentioning that the securities had not been actually received or that the cheques in payment of the purchase price were issued to Bhagwati Trading Company and not to the brokers. Raghunath Rai, the Secretary cum Accountant of the Insurance Company, on getting the advice about the purchase of securities used to inquire from Dalmia about the transaction and used to get the reply that Chokhani had purchased them under Dalmia 's instructions. Thereafter, the usual procedure in making the entries with respect to the purchase of securities was followed in the office and ultimately the purchase of securities used to be confirmed at the meeting of the Board of Directors. It is said that the matter was put up in the meeting with an office note which recorded that the purchase was under the instructions of the Chairman. Dalmia however, denies that Raghunath Rai ever approached him for the confirmation or approval of the purchase transaction and that he told him that the purchase transaction was entered into under his instructions. The firm of Khanna and Annadhanam, Chartered Accountants, was appointed by the Bharat Insurance Company, its auditors for the year 1954. Shri Khanna carried out the audit and was not satisfied with respect to certain matters and that made him ask for the counterfoils of the cheques and for the production of securities and for a satisfactory explanation of the securities not with the company at Delhi. 264 The matter, however, came to a head not on account of the auditors ' report, but on account of Shri Kaul, Deputy Secretary , Ministry of Finance, Government of India, hearing at Bombay in September 1955 a rumour about the unsatisfactory position of the securities of the Insurance Company. He contacted Dalmia and learnt on September 16, 1955 from Dalmia 's relatives that there was a short fall securities. He pursued the matter Departmentally and, eventually, the Government of India appointed Shri Annadhanam under a. 33 (1) of the to investigate into the affairs of the company. This was done on September 19, 1955. Dalmia is said to have made a confessional statement to Annadhanam on September 20. Attempt was made to reimburse the Insurance Company with respect to the short fall in securities. The matter was, however, made over to the Police and the appellants and a few other persons, acquitted by the Sessions Judge, were proceeded against as a result of the investigation. Dalmia 's defence, in brief, is that be had nothing to do with the details of the working of the company, that he had authorised Chokhani, in 1953, to purchase and sell securities and that thereafter Chokbani on his own purchased and sold securities. He had no knowledge of the actual modus operandi of Chokhani which led to the diversion of the funds of the company to the Union Agencies. He admits knowledge of the losses incurred by the Union Agencies and being told by Chokhani that he would arrange funds to meet them. He denies that he was a party to what Chokhani did. Chokhani admits that he carried out the transactions in the form alleged in order to meet the losses of the Union Agencies of which he was an employee. He states that be did so as he expected that the Union Agencies would, in due course, 265 make tip the losses and the money would be returned to the Insurance Company. According to, him, he was under the impression that what he did amounted to giving of a loan by the Insurance Company to the Union Agencies and that there was nothing wrong in it. He asserts emphatically that if he bid known that he was doing, was wrongful, he would have never done it and would have utilised other means to raise the money to meet the losses of the Union Agencies as he had large credit in the business circle at Bombay and as the Union Agencies possessed shares which would be sold to meet the losses. Vishnu Prasad expresses his absolute ignorance about the transactions which were entered into on behalf of Bbagwati Trading Company and states that what he did himself was under the instructions of Chokhani, but in ignorance of the real nature of the transactions. Gurha denies that he was a party to the fabrication of false accounts and vouchers in the furtherance of the interests of the conspiracy. The learned Sessions Judge found the offences charged against the appellants proved on the basis of the circumstances established in the case and, accordingly, convicted them as stated above. The High Court substantially agreed with the findings of the Sessions Judge except that it did not rely on the confession of Dalmia. Mr. Dingle Foot, counsel for Dalmia, has raised a number of contentions, both of law and of facts. We propose to deal with the points of law first. In order to appreciate the points of law raised by Mr. Dingle Foot, we may now state the charges which were framed against the various appellants. 266 The charge under section 120 B read with section 409, I.P.C., was against the appellants and five other persons and read: "I, Din Dayal Sharma, Magistrate I Class, Delhi, do hereby charge you, R. Dalmia (Ram Krishna Dalmia) s/o etc. G. L. Chokhani s/o etc. Bajranglal Chokhani s/o etc. Vishnu Pershad Bajranglal s/oetc. R. P. Gurha (Ragbubir Pershad Gurba) s/o etc. 6. J. section Mittal (Jyoti Swarup Mittal) s/o etc. 7. section N. Dudani (Shri Niwas Dudani) s/o etc. 8. G. section Lakhotia (Gauri Sbadker Lakbotia) s/o etc. V. G. Kannan Vellore Govindaraj Kannan S/o etc. accused as under : That you, R. Dalmia, G. L. Chokhani, Bajrang Lal Chokhani, Vishnu Pershad Bajranglal, R. P. Gurha, J. section Mittal, section N. Dudani, G. section Lakhotia and V. G. Karinan, during the period between August 1954 and September 1955 at Delhi, Bombay and other places in India. were parties to a criminal conspiracy to do and cause to be done illegal acts ; viz., criminal breach of trust of the funds of the Bharat Insurance Company Ltd., by agreeing amongst yourselves and with others that criminal breach of trust be Committed by you R. Dalmia and G. L. Chokhani 267 in respect of the funds of the said Insurance Company in current account No. 1120 of the said Insurance Company with the Chartered Bank of India, Australia and China, Ltd., Bombay, the dominion over which funds was entrusted to you R. Dalmia in your capacity as Chairman and the Principal Officer of the said Insurance Company, and to you G. L. Chokhani, in your capacity as Agent of the said Insurance Company, for the purpose of meeting losses suffered by you R. Dalmia in forward transaction (of speculation) in shares ; which transactions were carried on in the name of the Bharat Union Agencies Ltd., under the directions and over all control of R. Dalmia, by you, G. L. Chokhani, at Bombay, and by you, R. P. Gurha, J. section Mittal and section N. Dudani at Calcutta; and for other purposes not connected with the affairs of the said Insurance Company, by further agreeing that current account No. R1763 be opened with the Bank of India, Ltd., Bombay and current account No. 1646 with the United Bank of India Ltd., Bombay, in the name of M/s. Bhagwati Trading Company, by you Vishnu Pershed accused with the assistance of you G. L. Chokhani, and Bajranglal Chokhani accused for the illegal purpose of divertin g the funds of the said Insurance Company to the said Bharat Union Agencies, Ltd., by further agreeing that false entries showing that the defalcated funds were invested in Government Securities by the said Insurance Company be got made in the books of 268 accounts of the said Insurance Company at Delhi, and by further agreeing to the making of false and fraudulent entries by you R. P. Gurha, J. section Mittal, G. section Lakhotia, V. G. Kannan, and others, relating to the diversion of funds of the Bharat Insurance Company to the Bharat Union Agencies Ltd., through M/s. Bhagwati Trading Company, in the books of account of the said Bharat Union Agencies, Ltd., and its allied concern known as Asia Udyog Ltd., and that the same acts were committed in pursuance of the said agreement and thereby you committed an offence punishable under section 120 B read with section 409 I.P.C., and within the cognizance of the Court of Sessions. " Dalmia was further charged on two counts for an offence under section 409 I. P. C. These charges were as follows : "I Din Dayal Sharma, Magistrate I Class, Delhi charge you, R. Dalmia accused as under : FIRSTLY, that yon R. Dalmia, in Pursuance of the said conspiracy between the 9th day of August 1954 and the 8th day of August 1955, at Delhi. Being the Agent, in your capacity as Chairman of the Board of Directors and the Principal Officer of the Bharat Insurance Company Ltd., and as such being entrusted with dominion over the funds of the said Bharat Insurance Company, committed criminal breach of trust of the 269 funds of the Bharat Insurance Company Ltd., amounting to Rs. 2,37,483 9 0, by wilfully suffering your co accused G. L. Chokhani to dishonestly misappropriate the said funds and dishonestly use or dispose of the said funds in violation of the directions of law and the implied contract existing between you and the said Bharat Insurance Company, prescribing the mode in which such trust was to be discharged, by withdrawing the said funds from current account No. 1120 of the said Bharat Insurance Company with the Chartered Bank of India, Australia & China, Ltd., Bombay, by means of cheque Nos. B 540329 etc., issued in favour of M/s. Bhagwati Trading Company, Bombay, and cheque No. B 540360 in favour of F. C. Podder, and by dishonestly utilising the said funds for meeting losses suffered by you in forward transactions in shares carried on in the name of Bharat Union Agencies, Ltd., and for other purposes not connected with the affairs of the said Bharat Insurance Company ; and thereby committed an offence punishable under section 409, 1. P. C., and within the cognizance of the Court of Sessions; ,SECONDLY, that you R. Dalmia, in pursuance of the said conspiracy between the 9th day of August 1955 and the 30th day of September 1955, at Delhi, Being the Agent in your capacity as Chairman of the Board of Directors and the Principal Officer of the Bharat Insurance Company, Ltd., and as such being entrusted with dominion over the funds of the said Bharat Insurance Company, 270 committed criminal breach of trust of the funds of the Bharat Insurance Company Ltd., amounting to Rs. 55,43,220 12 0, by wilfully suffering your co accused G.L. Chokhani to dishonestly misappropriate the said funds and dishonestly use or dispose of the said funds in violation of the directions of law and the implied contract existing between you and the said Bharat Insurance Company prescribing the mode in which such trust was to be discharged, by withdrawing the said funds from current account No. 1120 of the said Bharat Insurance Company with the Chartered Bank of India, Australia & China, Ltd., Bombay by means of Cheque Nos. B 564835. issued in favour of M/s. Bhagwati Trading Company Bombay, and, by dishonestly utilising the said funds for meeting losses suffered by you in forward transactions in shares carried on in the name of the Bharat Union Agencies Ltd., and for other purposes not connected with the affairs of the said Bharat Insurance Company, and thereby committed an offence punishable under section 409 1. P. C., and within the cognizance of the Court of Sessions." Mr. Dingle Foot has raised the following contentions (1) The Delhi Court had no territorial jurisdiction to try offences of criminal breach of trust committed by Chokhani at Bombay. (2) Therefore, there had been misjoinder of charges. (3) The defect of misjoinder of charges was 271 fatal to the validity of the trial and was not curable under a. 531 section 537 of the Code. (4) The substantive charge of the offence under section 409, 1. P. C., against Dalmia offended against the provisions of a. 233 of the Code; therefore the whole trial was bad. (5) The funds of the Bharat Insurance Company in the Chartered Bank, Bombay, which were alleged to have been misappropriated were not "property ' within the meaning of sections 405 and 409, I. P. C. (6) If they were, Dalmia did not have dominion over them. (7) Dalmia was not an agent ' within the meaning of section 409 I. P. C., as only that person could be such agent who professionally carried on the business of agency. (8) If Dalmia 's conviction for an offence under section 409 I. P. C., fails, the conviction for conspiracy must also fail as conspiracy must be proved as laid. (9) The confessional statement Exhibit P 10 made by Dalmia on September 20, 1955, was not admissible in evidence. (10) If the confessional statement was not inadmissible in evidence in view of section 24 of the Indian Evidence Act, it was inadmissible in view of the provisions of cl. (3) of article 20 of the Constitution. (11) The prosecution has failed to establish that Dalmia was synonymous with Bharat Union Agencies Ltd. (12) Both the Sessions Judge and the High Court failed to consider the question of onus of proof i.e., failed to consider whether the evidence on record really proved or established the conclusion arrived at by the Courts. 272 (13) Both the Courts below erred in their approach to the evidence of Raghunath Rai. (14) Both the Courts below were wrong in holding that there was adequate corroboration of the evidence of Reounath Rai who was an accomplice or at least such a witness whose testimony required corroboration. (15) It is not established with the certainty required by law that Dalmia had knowledge of the impugned transactions at the time they were entered into. We have heared the learned counsel for the parties on facts, even though there are concurrent findings of fact, as Mr. Dingle Foot has referred us to a large number of inaccuracies, most of them not of much importance, in the narration of facts in the judgment of the High Court and has also complained of the omission from discussion of certain matters which were admittedly urged before the High Court and also of misapprehension of certain arguments presented by him. We need not, however, specifically consider points No. 12 to 15 as questions urged in that form. In discussing the evidence of Ragbunath Rai, we would discuss the relevant contentions of Mr. Dingle Foot, having a bearing on Raghunath Rai 's reliability. Our view of the facts will naturally dispose of the last point raised by him. Mr. Dingle Foot 's first four contentions relating to the illegalities in procedure may now be deal ,with. The two charges under section 409, I.P.C., against Chokbani mentioned that he committed criminal breach of trust in pursuance of the said conspiracy. One of the charges related to the period from August 9, 1954 to August 8, 1955 and the other related to the period from August 9, 1955 to September 30, 1955. 273 This Court held in Purushotam Das Dalmia vs State of West Bengal (1) that the Court having jurisdiction to try the offence of conspiracy has also jurisdiction to try an offence constituted by the overt acts which are committed, in pursuance of the conspiracy, beyond its jurisdiction. M. Dingle Foot submitted that this decision required reconsideration and we heard him and the learned Solicitor General on the point and, having considered their submissions, came to the conclusion that no case for reconsideration was made out and accordingly expressed our view during the hearing of these appeals. We need not, therefore, discuss the first contention of Mr. Dingle Foot and following the decision in Purushottam Das Dalmia 's case(1) hold that the Delhi Court had jurisdiction to try Chokhani of the offence under section 409 I.P.C. as the offence was alleged to have been committed in pursuance of the criminal conspiracy with which he and the other co accused were charged. In view of this opinion, the second and third contentions do not arise for consideration. The fourth contention is developed by Mr.Dingle Foot thus. The relevant portion of the charge under section 409 I. P. C., against Dalmia reads: "Firstly, that you Dalmia, in pursuance of the said conspiracy between. being the Agent, in your capacity as Chairman of Board of Directors and as Principal Officer of the Bharat Insurance Company Ltd., and as such being entrusted with dominion over the. funds of the said Bharat Insurance Company, committed criminal breach of trust of the fund, . by wilfully suffering your co accused G. L. Chokhani to dishonestly misappropriate the said funds and dishonestly use or dispose of the said funds in violations of the directions of law and the implied contract existing between you and the said Bharat Insurance (1) [1962]2S.C.R101. 274 Company prescribing the mode in which such trust was to be discharged. " This charge can be split up into four charges, each of the charges being restricted to one particular mode of committing the offence of criminal breach of trust. These four offences of criminal breach of trust were charged in one count, each of these four amounting to the offence of criminal breach of trust by wilfully suffering Chokhani (i) to dishonestly misappropriate the said funds; (ii) to dishonestly use the said funds in violation of the directions of law; (iii) to dishonestly dispose of the said funds in violation of the directions of law; (iv) to dishon estly use the said funds in violation of the implied contract existing between Dalmia and the Bharat Insurance Company '. Section 233 of the Code or Criminal Procedure permits one charge for every distinct offence and directs that every charge shall be tried separately except in the cases mentioned in sections 234, 235, 236 and 239. Section 234 allows the trial, together, of offences up to three in number, when they be of the same kind and be committed within the space of twelve months. The contention, in this case is that the four offences into which the charge under section 409 I.P.C. against Dalmia can be split up were distinct offences and therefore could not be tried together. We do not agree with this contention. The charge is with respect to one offence, though the mode of committing it is not stated precisely. If it be complained that the charge framed under s.409 1. P. C. is vague because it does not specifically state one particular mode in which the offence was committed, the vagueness of the charge will not make the trial illegal, especially when no prejudice is caused to the accused and no contention has been raised that Dalmia was prejudiced by the form of the charge. 275 We may now pass on to the other points raised by Mr. Dingle Foot. Section 405 I.P.C. defines what amounts to criminal breach of trust. It reads "Whoever, being in any manner entrusted with property, or with, any dominion over property, dishonestly misappropriates or converts to his own use that propertly, or dishonestly uses or disposes of that property in violation of any direction of law prescribing the mode in which such trust is to be discharged, or of any legal contract, express or implied, which be has made touching the discharge of such trust, or wilfully suffers any other person so to do, commits 'criminal breach of trust '. " Section 406 provides for punishment for criminal breach of trust. Section 407 provides for punishment for criminal breach of trust committed by a carrier, wharfinger or warehouse keeper, with respect to property entrusted to them as such and makes their offence more severe than the offence under section 406. Similarly, section 408 makes the criminal breach of trust committed by a clerk or servant entrusted in any manner, in such capacity, with property or with any dominion over property, more severely punishable than the offence of criminal breach of trust under section 406. Offences under ss.407 and 108 are similarly punishable. The last section in the series is section 409 which provides for a still heavier punishment when criminal breach of trust is committed by persons mentioned in that section. The section reads : "Whoever, being in any manner entrusted with property, or with any dominion over property in his capacity of a public servant or in the way of his business as a banker, merchant, factor, broker, attorney or agent, 276 commits criminal breach of trust in respect of that property, shall be punished with imprisonment for life, or with imprisonment of either description for a term which may ex tended to ten years, and shall also be liable to fine." Both Dalmia and Chokhani have been convicted of the offence under section 409 I.P.C. Mr. Dingle Foot contends that no offence of criminal breach of trust has been committed as the funds of the Bharat Insurance Company in the Bank do not come with the expression 'property ' in section 405 I.P.C. It is urged that the word 'property ' is used in the Indian Penal Code in different senses, according to the context, and that in section 405 it refers to movable property and not to immovable property or to a chose in action. It is then contended that the funds which a customer has in a bank represent closes in action, as the relationship between the customer and the banker is that of a creditor and a debtor, as held in Attorney General for Canada vs Attorney General for Province of Quebec & Attorneys General for Saskatchewan, Alberta & Manitoba (1) and in Foley vs Hill (2). Reliance is also placed for the suggested restricted meaning of property in section 405 I.P.C. on the cases Reg. vs Girdhar Dharamdas (3); Jugdown Sinha vs Queen Empress( 4) and Ram Chand Gurvala vs King Emperor (5) and also on the scheme of the Indian Penal Code with respect to the use of the expressions 'property ' and 'movable property ' in its various provisions. The learned Solicitor General has, on the other hand, urged that the word 'property ' should (1) (2) ; (3) [1869] 6 Bom. High Ct. Rep. (Crown Cases) 33. (4) (1895)1.L.R.23Cal.372. (5) A.I.R.1926Lah 385. 277 be given its widest meaning and that the provisions of the various sections can apply to property other than movable property. It is not to be restricted to movable property only but includes chose in De. action and the funds of a company in Bank. We are of opinion that there is no good reason to restrict the meaning of the word 'property ' to movable property only when it is used without any qualification in section 405 or in other sections of the Indian Penal Code Whether the offence defined in a particular section of the Indian Penal Code can be committed in respect of any particular kind of property will depend not on the interpretation of the word 'property ' but on the fact whether that particular kind of property can be subject to the acts covered by that section. It is in this sense that it may be said that the, word property in a particular section covers only that type of property with respect to which the offence contemplated in that section can be committed. Section 22 I.P.C. defines 'movable property '. The definition is not exhaustive. According to the section the words 'movable property ' are intended to include corporeal property of every description, except land and things attached to the earth or permanently fastened to anything which is attached to the earth. The definition is of the expression ,movable property ' and not of 'property ' and can apply to all corporeal property except property excluded from the definition. It is thus clear that the word 'property ' is used in the Code in a much wider sense than the expression movable property '. It is not therefore necessary to consider in detail what type of property will be included in the various sections of the Indian Penal Code. In Reg. vs Girdhar Dharamdas (1) it was held that reading sections 403 and 404 I.P.C. together, section 404 (1) (1869) 6 Bom. High Ct. Rep. (Crown Cases) 278 applied only to movable property. No reasons are given in the judgment. It is to be noticed that though section 403 I.P.C. speaks of dishonestly misappropriating or converting to one 's own use any movable property, section 404 speaks of only dishonestly misappropriating or converting to one 's own use property. If the Legislature had intended to restrict the operation of section 404 to movable property only, there war, no reason why the general word was used without the qualifying word ,movable '. We therefore do not see any reason to I restrict the word 'property ' to , 'movable property only. We need not express any opinion whether immovable property could be the subject of the offence under section 404 I.P.C. Similarly, we do not see any reason to restrict the word 'property ' in section 405 to movable property ' as held in Jugdown Sinha vs Queen Empress (1). In that case also the learned Judges gave no reason for their view and just referred to the Bombay Case (2). Further, the learned Judges observed at page 374 : "In this case the appellant was not at most entrusted with the supervision or management of the factory lands, and the fact that he mismanaged the land does not in our opinion amount to a criminal offence under section 408. " A different view has been expressed with respect to the content of the word property ' in certain sections of the Indian Penal Code, including section 405. In Emperor vs Bishan Prasad (3) the right to sell drugs was held to come within the definition of the word 'property ' in section 185, I.P.C. which makes certain conduct at any sale of property an offence. (1) Col. 372. (2) (1869) 6 Boni. High Ct. Rep. (Crown Cases) 33, 3) All. 128. 279 In Ram Chand Gurwala vs King Emperor (1) the contention that mere transfer of amount from the bank account to his own account by the accused did not amount to misappropriation was repelled, it being held that in order to establish a charge of dishonest misappropriation or criminal breach of trust, it was not necessary that the accused should have actually taken tangible property such as cash from the possession of the bank and transferred it to his own possession, as on the transfer of the amount from the account of the Bank to his own account, the accused removed it from the control of the bank and placed it at his own disposal. The conviction of the accused for criminal breach of trust was confirmed. In Manchersha Ardeshir vs Ismail Ibrahim it was held that the word 'property ' in section 421 is wide enough to include a chose in action. In Daud Khan vs Emperor (3) it was said at page 674 : "Like section 378, section 403 refers to movable property. Section 404 and some of the other sections following it refer to property without any such qualifying description; and in each case the context must determine whether the property there referred to is intended to be property movable or immoveable. " The case law, therefore, is more in favour of the wider meaning being given to the word 'property ' in sections where the word is not qualified by any other expression like movable '. In The Delhi Cloth and General Mills Co. Ltd. V. Harnam Singh (4) this court said "That a debt is property is, we think, clear. It is a chose in action and is heritable (1) A.I.R. 1926 Lah. (3) A.I.R. 1925 All. (2) Bom. (4) ,417. 280 and assignable and it is treated as property in India under the Transfer of Property Act which calls it an actionable claim '. " In Allchin vs Coulthard (1) the meaning of the expression fund ' has been discussed it is said: "Much of the obscurity which surrounds this matter is due to a failure to distinguish the two senses in which the phrase 'payment out of a fund ' may be used. The word fund ' may mean actual cash resources of a particular kind (e. g., money in a drawer or a bank), or it may be a mere accountancy expression used to describe a particular category which a person uses in making up his accounts. The words 'payment out of when used in connection with the word fund ' in its first meaning connote actual payment, e. g., by taking the money out of the drawer or drawing a cheque on the bank. When used in connection with the word 'fund ' in its second meaning they connote that, for the purposes of the account in which the fund finds a place, the payment is debited to that fund, an operation which, of course, has no relation to the actual method of payment or the particular cash resources out of which the payment is made. Thus, if a company makes a payment out of its reserved fundan example of the second meaning of the word fund ' the actual payment is made by cheque drawn on the company 's banking account, the money in which may have been derived from a number of sources". The expression funds ' in the charge is used in the first sense meaning thereby that Dalmia and Chokhani had dominion over the amount credited to the Bharat Insurance Company in the account (1) , 234, 281 of the Bank, inasmuch as they could draw cheques on that account. We are therefore of opinion that the funds referred to in the charge did amount to 'property ' within the meaning of that term in section 405 I.P.C. It is further contended for Dalmia that he had not been entrusted with dominion over the funds in the Banks at Bombay and had no control over them as the Banks had not been informed that Dalmia was empowered to operate on the company 's accounts in the Banks and no specimen signatures of his had been supplied to the Bank. The omission to inform the Banks that Dalmia was entitled to operate on the account may disable Dalmia to actually issue the cheques on the company 's accounts, but that position does not mean that he did not have any dominion over those accounts. As Chairman and Principal Officer of the Bharat Insurance Company, he had the power, on behalf of the company, to operate on those accounts. If no further steps are taken on the execution of the plan, that does not mean that the power which the company had entrusted to him is nullified. One may have dominion over property but may not exercise any power which he could exercise with respect to it. Non exercise of the power will not make the dominion entrusted to him, nugatory. Article 116 of the Articles of Association of the Bharat Insurance Company provides that the business of the company shall be managed by the Directors, who may exercise all such powers of the company as are not, under any particular law or regulation, not to be exercised by them. Article 117 declares certain powers of the Directors. Clause (7) of this Article authorises them to draw, make, give, accept, endorse, transfer, discount and negotiate 'such bill of exchange, promissory notes and other similar obligations as may be desirable for carrying on the business of the 282 company. Clause (10) authorizes them to let, mortgage, sell, or otherwise dispose of any property of the company either absolutely. Clause (12) authorises them to invest such parts of the fund of the company as shall not be required to satisfy or provide for immediate demands, upon such securities or investments as they may think advisable. It also provides that the funds of the company shall not be applied in making any loan or guaranteeing any loan made to a Director of the company or to a firm of which such Director is a partner or to a private company of which such Director is a Director. Clause (23) empowers the Director to deal with and invest any Moneys of the company not immediately required for the purposes thereof, in Government Promissory Notes, Treasury Bills, Bank Deposits, etc. The bye laws of the company entrusting the Chairman with dominion over its property, were revised in 1951. The Board of Directors, at their meeting held on September 8, 1951, resolved: "The bye laws as per draft signed by the Chairman for identification be and are hereby approved, in substitution and to the exclusion of the existing bye laws of the company." No such draft as signed by the Chairman has been produced in this case. Instead, K. L. Gupta, P. W. 112, who was the Manager of the Bharat Insurance Company in 1951 and its General Manager from 1952 to August, 1956, has proved the bye laws, Exhibit P. 786, to be the draft revised bye laws approved by the Board of Directors at that meeting. He states that he was present at that meeting and had put up these draft bye laws before the Board of Directors and that the Directors, while passing these bye laws, issued a directive that they should come into force on January 1, 1952, and that, accordingly, be added in ink in the opening words of 283 the bye laws that they would be effective from January 1, 1952. When cross examined by Dalmia himself, he stated that he did not attend any other meeting of the Board of Directors and his presence was Dot noted in the minutes of the meeting. He further stated emphatically: "I am definite that I put up the bye laws P 786 in the meeting of the Board of Directors. I did not see any bye laws signed by the Chairman. " There is no reason why Gupta should depose falsely. His statement finds corroboration from other facts. It may be that, as noted in the resolution, it was contemplated that the revised bye laws be signed by the Chairman for the purposes of their identity in future, but by over sight such signatures were not obtained. There is no evidence that the bye laws approved by the Board of Directors were actually signed by the Chairman Dalmia. Dalmia has stated so. It is not necessary for the proof of the bye laws of the company that the original copy of the bye laws bearing any mark of approval of the Committee be produced. The bye laws of the company can be proved from other evidence. K. L. Gupta was present at the meeting when the bylaws were passed. It seems that it was not his duty to attend meetings of the Board of Directors. He probably attended that meeting because he had prepared the draft of the revised bye laws. His presence was necessary or at least desirable for explaining the necessary changes in the pre existing bye laws. He must have got his own copy of the revised bye laws put up before the meeting and it is expected that he would make necessary corrections in his copy in accordance with the form of the bye laws as finally approved at the meeting. The absence of the copy signed by the Chairman. if ever one existed, does not therefore make the other evidence about the bye laws of the 284 company in admissible. The fact that Gupta signed each page of Exhibit P. 786 supports his statement. There was no reason to sign every page of the copy if it was merely a draft office copy that was with him. He must have signed each page on account of the importance attached to that copy and that could only be if that copy was to be the basis of the future bye laws of the company. Copies of the bye laws were supplied to '.he Imperial Bank, New Delhi, and to the auditor. They are Exhibits P. 897 and P. 15. Raghunath Rai deposed about sending the bye laws Exhibits P. 897 to the Imperial Bank, New Delhi, with a covering letter signed by Dalmia on September 4, 1954. Mehra, P. W. 15, Sub Accountant of the State Bank of India (which took over the under taking of the Imperial Bank of India on July 1, 1955) at the time of his deposition, stated that the State Bank of India was the successor of the Imp erial Bank of India. Notice was issued by the Court to the State Bank of India to produce latter dated September 4, 1954, addressed by Dalmia to the Agent, Imperial Bank of India, and other documents. Mehra deposed that in spite of the best search made by the Bank officials that letter could not be found and that Exhibit P. 897 was the copy of the bye laws of the Bharat Insurance Company which he was producing in pursuance of the notice issued by the Court. It appears from his statement in cross examination that the words received 15th September 1954 meant that copy of the byelaws was received by the Bank on that date. Mehra could not personally speak about it. Only such bye laws would have been supplied to the Bank as would have been the corrected bye laws. These bye law Exhibit P. 897 tally with the bye laws Exhibit P. 786. Raghunath Rai proves the letter Exhibit P. 896 to be a copy of the letter sent along with these bye laws to the Bank and states that 285 both the original and P. 896 were signed by Dalmia. He deposed: "exhibit P. 786 are the bye laws of the Bharat Insurance Company which came into operation on 1 1 52 I supplied copy of exhibit p. 786 as the copy of the bye laws of the Bharat Insurance Company to the State Bank of India, New Delhi Shri Dalmia thereupon certified as true copies of the resolutions which were sent along with the copy of the bye laws. He also signed the covering letter which was sent to the State Bank of India along with the copy of the bye laws exhibit p.786 and the copies of the resolutions. I produce the carbon copy of the letter dated 4 9 54 which was sent as a covering letter with the bye laws of the Bharat Insurance Company to the Imperial Bank of India, New Delhi. It is exhibit p. 896. The carbon copy bears the signatures of R. Dalmia accused, which signatures I identify The aforesaid Bank (Imperial Bank) put a stamp over exhibit p. 896 with regard to the receipt of its original. The certified copy of the byelaws of the Bharat Insurance Company which was sent for registration to the Imperial Bank along with the original letter of which exhibit p. 896 is a carbon copy is Ex.p. 897 (heretofore marked C). The copy of the bye laws has been certified to be true by me under my signatures. " Dalmia states in answer to question No. 15 (put to him under section 342, Cr. P. C.) that the signature,,, on exhibit p. 896 appear to be his. 286 Letter Exhibit P. 896 may be usefully quoted here "SEC The Agent, 4 9 54 Imperial Bank of India, New Delhi: Dear Sir, Re : Safe Custody of Govt. Securities. We are sending herewith true copies of Resolution No. 4 dated 10th March, 1949, Resolution No. 3 dated 10th March, 1949, and Resolution No. 8 dated 8th September, 1951, along with a certified copy of the Bye laws of the Company for registration at your end. By virtue of article 12 clause (e) of the Byelaws of the Company I am empowered to deal in Government Securities etc. The specimen signatures Card of the undersigned is also sent herewith. Yours faithfully, Encls. 5 Sd/ R. Dalmia Chairman. " By Resolution No. 4 dated March 10, 1949, Dalmia was co opted Director of the Company. By Resolution No. 'a dated March 19, 1949, Dalmia was elected Chairman of the Board of Directors. Resolution No. 8 dated September 8, 1951 was : "Considered the draft bye laws of the Company and Resolved that the Bye laws as per draft signed by the Chairman for identification be and are hereby approved in substitution and to the exclusion of the existing bye laws of the Company. " 287 The letter Exhibit P. 896 not only supports the statement of Raghunath Rai about the copy of the bye laws supplied to the Bank to be a certified copy but also the admission of Dalmia that he was empowered to deal in Government Securities etc., by virtue of article 12, clause (e), of the bye laws of the company. There therefore remains no room for doubt that bye laws Exhibit P. 897 are the certified copies of the bye laws of the company passed on September 8, 1951 and in force on September 4, 1954. We are therefore of opinion that either due to oversight the draft bye laws said to be signed by the Chairman Dalmia were not signed by him or that such signed copy is no more available and that bye laws Exhibits P. 786 and P. 897 are the correct bye laws of the company. Article 12 of the company 's bye laws provides that the Chairman shall exercise the powers enumerated in that article in addition to all the powers delegated to the Managing Director. Clause (e) of this article authorises him to negotiate, transfer, buy and sell Government Securities etc., and to pledge, endorse, withdraw or otherwise deal with them. Article 13 of the bye laws mentions the powers of the Managing Director. Clause (12) of this article empowers the Managing Director to make, draw, sign or endorse, purchase, sell, discount or accept cheques, drafts, hundies, bills of exchange and other negotiable instruments in the name and on behalf of the company. Article 14 of the bye laws originally mentioned the powers of the Manager. The Board of Directors, by resolution No. 4 dated October 6,1952 resolved that these powers be exercised by. K. L. Gupta as General Manager and the necessary corrections be made. 288 By resolution No. 4 dated August 30, 1954, of the Board of Directors, the General Manager was empowered to make, draw, sign or endorse, purchase, sell, discount or accept cheques, drafts, hundies, bills of exchange and other negotiable instruments in the name and on behalf of the company and to exercise all such powers from time to time incidental to the post of the General Manager of the Company and not otherwise excepted. By the same resolution, the words 'Managing Director ' in Article 12 of the Bye laws stating the powers of the Chairman, were substituted by the words 'General Manager. ' Thereafter, the Chairman could exercise the powers of the General Manager conferred under the byelaws or other resolutions of the Board. It is clear therefore from these provisions of the articles and bye laws of the company and the resolutions of the Board of Directors, that the Chairman and the General Manager had the power to draw on the funds of the company. Chokhani had authority to operate on the account of the Bharat Insurance Company at Bombay under the resolution of the Board of Directors dated January 31, 1951. Both Dalmia and Chokhani therefore had dominion over the funds of the Insurance Company. In Peoples Bank vs Harkishen Lal (1) it was ,stated "Lala Harkishen Lal as Chairman is a trustee of all the moneys of the Bank." In Palmer 's Company Law, 20th Edition, is stated at page 517 "Directors are not only agents but they are in some sense and to some extent trustees or in the position of trustees." (1) A.I.R. 1936 Lah. 468, 409. 289 In G. E. Ry. Co. vs Turner (1) Lord Selborne said : "The directors are the mere trustees or agents of the company trustees of the company 's money and property agents in the transactions which they enter into on behalf of the company. In Re. Forest of Dean etc. , Co. (2) Sir George Jessel said: "Directors are called trustees. They are no doubt trustees of assets which have come into their hands, or which are under their control. " We are therefore of opinion that Dalmia and Chokhani were entrusted with the dominion over the funds of the Bharat Insurance Company in the Banks. It has been urged for Chokhani that he could not have committed the offence of criminal breach of trust when he alone had not the dominion over the funds of the Insurance Company, the accounts of which he could not operate alone. Both Ragbunath Rai and he could operate on the accounts jointly. In support of this contention, reliance is placed on the case reported as Bindeshwari vs King Emperor (3). We do not agree with the contention. Bindeshwari 's Case (3 ) does not support the contention. In that case, a joint family firm was appointed Government stockist of food grain. The partners of the firm were Bindeshwari and his younger brother. On check, shortage in food grain was found. Bindeshwari was prosecuted and convicted by the trial Court of an offence under section 409 1. On appeal, the High Court set aside the conviction of Bindeshwari of the offence under (1)L. R. ,152 (2) L. R. ,453, (3) Pat. 703, 715. 290 section 409 I. P. C. and held him not guilty of the offence under that section as the entrustment of the grain was made to the firm and not to him personally. The High Court convicted him, instead, of the offence under section 403 1. P. C. This is clear from the observation : "In my opinion, the Government rice was entrusted to the firm of which the petitioner and his younger brother were the proprietors. Technically speaking, there was no entrustment to the petitioner personally. " This case clearly did not deal directly with the question whether a person who, jointly with another, has dominion over certain property, can commit criminal breach of trust with respect to that property or not. On the other hand, a Full Bench of the Calcutta High Court took a different view in Nrigendro Lall Chatterjee vs Okhoy Coomar Shaw (1). The Court said : "We think the word, of Section 405 of the Penal Code are large enough to include the case of a partner, if it be proved that he was in fact entrusted with the partnership property, or with a dominion over it, and has dishonestly misappropriated it, or converted it to his own use." Similar view was expressed in Emperor vs Jagannath Raghunathdas. (2) Beaumont C. J.Said at. But, in my opinion, the words of the section (section 405) are quite wide enough to cover the case of a partner. Where one partner is given authority by the other partners to collect moneys or property of the firm I think that he is entrusted with dominion over (1) (1874) 21 W. R. (criminal Rulings) 59. 61 ,1521 291 that property, and if he dishonestly misappro priates it, then I think he comes within the Section. " Barlee J., agreed with this opinion. The effect of Raghupath Rai 's delivering the blank cheques signed by him to Chokbani may amount to putting Chokbani in sole control over the funds of the Insurance Company in the Bank and there would Dot remain any question of Chokhani 's having joint dominion over those funds and this contention, therefore, will not be available to him. It was also urged for Chokhani that he bad obtained control over the funds of the Insurance Company by cheating Raghunath Rai inasmuch as he got blank cheques signed by the latter on the representation that they would be used for the legitimate purpose of the company but latter used them for purposes not connected with the company and that, therefore, he could not commit the offence of criminal breach of trust. This may be so, but Chokhani did not got dominion over the funds on account of Raghunath Rai 's signing blank cheques. The signing of the blank cheques merely facilitated Chokhani 's committing breach of trust. He got control and dominion over the funds under the powers conferred on him by the Board of Directors, by its resolution authorising him and Raghunath Rai to operate on the accounts of the Insurance Company with the Chartered Bank, Bombay. The next contention is that Dalmia and Chokhani were not agents as contemplated by section 409 I. P. C. The contention is that the word "agent ' in this Section refers ' to a professional agent ' i. e., a person who carried on the profession of agency and that as Dalmia and Chekbani did not carry on such profession, they could not be covered by the expression 'agent ' in his section. 292 Reliance is placed on the case reported as Mahumarakalage Edward Andrew Cooray vs The Queen (1). This case approved of what was said in Reg. vs Portugal (2) and it would better to discuss that case first. That case related to an offence being committed by the accused under section 75 of the Larceny Act, 1861 (24 & 25 Viet. c. 96). The relevant portion of the section reads. "Whosoever, having been intrusted, either solely or jointly with any other person, as a banker, merchant, broker, attorney or other agent, with any chattel or valuable security, or any power of attorney for the sale or transfer of any share or interest in any public stock or find. . or in any stock or fund of any body corporate, & c. for safe custody or for any special purpose, without any authority to sell, negotiate, transfer, or pledge, shall, in violation of good faith and contrary to the object or purpose for which such chattel & c., was intrusted to him sell, negotiate, pledge, & c., or in any manner convert to his own use or benefit, or the use or benefit of any person other than the person by whom he shall have been so intrusted. . shall be guilty of a misdemeanor. The accused in that case was employed by a firm of Railway contractors for commission ' to use his influence to obtain for them a contract for the construction of a railway and docks in France. In the course of his employment, he was entrusted with a cheque for pound 500/ for the purpose of opening a credit in their name in one of the two specified banks in Paris. He was alleged to have misappropriated the cheque to his own use fraudulently. He was also alleged to have fraudulently dealt with another bill for pound 250/ and other securities which had (1) , 419. (2) 293 been entrusted to him for a special purpose. He was committed for trial for the offence under section 75. He, on arrest under an extradition warrant, was committed to prison with a view to his extradition in respect of an offence committed in France. It was contended on his behalf: "To justify the committal under the Extradition Act, it was incumbent on the prosecutors to offer prima facie evidence that the money and securities which the prisoner was charged with having misappropriated were intrusted to him in the capacity of "agent ', that is, a person who carries on the business or occupation of an agent, and intrusted with them in that capacity, and without any authority to sell, pledge, or negotiate, and not one who upon one solitary occasion acts in a fiduciary character. " It was held, in view of the section referring to ,banker, merchant, broker, attorney or other agent ', that a. 75 was limited to a class, and did not apply to everyone who might happen to be intrusted as prescribed by the section, but only to the class of persons therein mentioned. It was further said : "In our judgment, the 'other agent ' mentioned in this section means one whose business or profession it is to receive money, securities or chattels for safe custody or other special purpose; and that the term does not include a person who carries on no such business or profession, or the like. The section is aimed at those classes who carry on the occupations or similar occupations to those mentioned in the section, and not at those who carry on no such occupation, but who may happen from time to time to undertake some fiduciary position, whether for money or otherwise". 294 This case therefore is authority to this effect only that the term agent ' in that section does not include a person who just acts as ,in agent for another for a particular purpose with respect to some property that is entrusted to him, i. e., does not include a person who becomes an agent as a consequence of what he has been charged to do, and who has been asked to do a certain thing with respect the property entrusted to him, but includes such person who, before such entrustment and before being asked to do something, already carried on snob business or profession or the like as necessitates, in the course of such business etc. , his receiving money, securities or chattels for safe custody or other special purpose. That is to say, he is already an agent for the purpose of doing such acts and is subsequently entrusted with property with direction to deal with it in a certain manner. It is not bold that a person to be an agent within that section must carry on the profession of an agent or must have an agency. The accused, in that case, was therefore not held to be an agent. It may also be noticed that he was so employed for a specific purpose which was to use his influence to obtain for his employers a contract for the construction of a railways and docks in France. This assignment did not amount to making him an agent of the employers for receiving money etc. In Mahumarakalage Edward Andrew Cooray 's Case (1) the Privy Council was dealing with the appeal of a person who had been convicted under section 392 of the Penal Code of Ceylon. Sections 388 to 391 of the Ceylon Penal Code correspond to sections 405 to 408 of the Indian Penal Code. Section 392 corresponds to section 409 1. It was contended before the Privy Council that the offence under section 392 was limited to the case of one who carried on an agency business and did not comprehend a person who was casually entrusted with money either on one individual (1) 419. 295 occasion or a number of occasions, provided that the evidence did not establish that he carried on an agency business. Their Lordships were of opinion that the reasoning in Reg. vs Portugal (1) for the view that section 75 of the Larceny Act was limited to the class of persons mentioned in it, was directly applicable to the case they were considering, subject to some immaterial variations, arid finally said : " 'In enunciating the construction which they have placed on section 392 they would point out that they are in no way impugning the decisions is certain cases that one act of en trustment may constitute a man a factor for another provided he is entrusted in his busi ness as a mercantile agent, nor are they deciding what activity is required to establish that an individual is carrying on the business of an agent". These observations mean that the view that section 75 was limited to the class of persons mentioned therein did not affect the correctness of the view that a certain act of entrustment may Constitute a person a factor for another provided be was entrusted in his business as a mercantile agent. It follows that a certain entrustment, provided it be in the course of business as a mercantile agent, would make the person entrusted with a factor, i. e., would make him belong to the class of factors. The criterion to hold a person a factor, therefore, is that his business be that of a mercantile agent and not necessarily that he be a professional mercantile agent. Further, their Lordships left it open as to what kind of activity on the part of a person alleged to be an agent would establish that he was carrying on the business of an agent. This again makes it clear that the emphasis is not on the person 's carrying on the profession of an agent, but on his carrying on the business of an agent. (1) 296 These cases, therefore, do not support the contention for Dalmia and Chokhani that the term "agent ' in section 409 I. P. C., which corresponds to section 392 of the Ceylon Penal Code., is restricted only to those persons who carry on the profession of agents. These cases are authority for the view that the word 'agent ' would include a person who belongs to the class of agents, i.e., who carries on the business of an agent. Further, the accused in the Privy Council Case (1) was not held to be an agent. In so holding, their Lordships said : "In the present case the appellant clearly was not doing so, and was in no sense entitled te receive the money entrusted to him in any capacity, nor indeed, had Mr. Ranatunga authority to make him agent to hand it over to the bank." To appreciate these reasons, we may mention here the facts of that case. The accused was the President of the Salpiti Koral Union. The Union supplied goods to its member societies through three depots. The accused was also President of the Committee which controlled one of these depots. He was also Vice President of the Co operative Central Bank which advanced moneys to business societies to enable them to buy their stocks. The societies repaid the advance weekly through cheques and/or money orders, except when the advance be of small sums. The Central Bank, in its turn, paid in the money orders, cheques and cash to its account with the Bank of Ceylon. The accused appointed one Ranatunga to be the Manager of the depot which was managed by the Committee of which he was the President. The payments to the Central Bank used to be made through him. The accused instructed this Manager to follow a course other than the prescribed routine. It was that he was to collect (1) , 419. 297 the amounts from the stores in cash and hand them over to him for transmission to the Bank. The accused thus got the cash from the Manager and sent his own cheques in substitution for the amounts to the Central Bank. He also arranged as the Vice President of that Bank that in certain cases those cheques be not sent forward for collection and the result was that he could thus misappropriate a large sum of money. The Privy Council said that the accused was not entitled to receive the money entrusted to him in any capacity, that is to say as the Vice President of the Cooperative Central Bank or the President of the Union controlling the depots or as the President of the Committee. It follows from this that he could not have received the money in the course of his duties as, any of these office bearers. Further, the Manager of the depot had no authority to make the accused an agent for purposes of transmitting the money to the Bank. The reason why the accused was not held to be an agent was not that he was not a professional agent. The reason mainly was that the amount was not entrusted to him in the course of the duties he had to discharge as the office bearers of the various institutions. Learned counsel also made reference to the case reported as Rangamannar Chatti vs Emperor (1). it is not of much help. The accused there is said to have denied all knowledge of the jewels which had been given to him by the complainant for pledging and had been pledged and redeemed. It was said that it was not a case under a. 409 I. P. C. The reason given was: "There is no allegation that the jewels were entrusted to the accused 'in the way of his business as an agent '. No doubt he is said to (1) (1935) M.W.M, 649. 298 have acted as the complainant 's agent, but he is not professionally the complainants agent nor was this affair a business transaction. " The reasons emphasize both those aspects we have referred to in considering the judgment of the Privy Council in Mahumarakalag Edward Andrew Cooray 's Case (1), and we need not say anything more about it. What section 409 I.P.C. requires is that the person alleged to have committed criminal breach of trust with respect to any property be entrusted with that property or with dominion over that property in the way of his business as an agent. The expression in the way of his business ' means that the property is entrusted to him in the ordinary course of his duty or habitual occupation or profession or trade '. He should get the entrustment or dominion in his capacity as agent. In other words, the requirements of this section would be satisfied if the person be an agent of another and that other person entrusts him with property or with any dominion over that property in the course of his duties as an agent. A person may be an agent of another for some purpose and if he is entrusted with property not in connection with that purpose but for another purpose, that entrustment will not be entrustment for the purposes of section 409 I.P.C. if any breach of trust is committed by that person. This interpretation in no way goes against what has been held in Reg. vs Portugal (2) or in Mahumarakalage Edward Andrew Cooray 's 'Case (1), and finds support from the fact that the section also deals with entrustment of property or with any dominion over property to a person in his capacity of a public servant. A different expression 'in the way of his business ' is used in place of the expression 'in his capacity, ' to make it clear that entrustment of property in the capacity of agent will not, by itself, be sufficient to make (1) 419. (2) (188 5) lb Q.B.D. 487. 299 the criminal breach of trust by the agent a graver offence than any of the offences mentioned is sections 406 to 408 I.P.C. The criminal breach of trust by an agent would be a graver offence only when he is entrusted with property not only in his capacity as an agent but also in connection with his duties as an agent. We need not speculate about the reasons which induced the Legislature to make the breach of trust by an agent more severely punishable than the breach of trust committed by any servant. The agent acts mostly as a representative of the principal and has more powers in dealing with the property of the principal and, consequently, there are greater chances of his misappropriating the property if he be so minded and less chances of his detection. However, the interpretation we have put on the expression 'in the way of his business ' is also borne out from the Dictionary meanings of that expression and the meanings of the words 'business ' and 'way ', and we give these below for convenience. 'In the way of ' of the nature of, belong ing to the class of, in the course of or routine of (Shorter Oxford English Dictionary) in the matter of, as regards, by way of (Webster 's New Inter national Dictionary, II Edition, Unabrid ged) Business ' occupation, work (Shorter Oxford Eng lish Dictionary) mercantile transactions, buying and selling, duty, special imposed or under 300 taken service, regular occupation (Webster 's New Inter national Dictionary, II Editional, Unabrid ged) duty, province, habitual occupation, profession, trade (Oxford Concise Dictionary) 'Way ' scope, sphere, range, line of occupation Oxford Concise Dictionary) Chokhani was appointed agent of the Bharat Insurance Company on January 31, 1951. He admits this in his statement under section 342, Cr. P.C. He signed various cheques as agent of this company and he had been referred to in certain documents as the agent of the company. Dalmia, as a Director and Chairman of the company, is an agent of the company. In Palmer 's Company Law, 20th Edition, is stated, at page 513 : "A company can only act by agents, and usually the persons by whom it acts and by whom the business of the company is carried on or superintended are termed directors. . Again, at page 515 is noted : (Directors are, in the eye of the law, agents of the company for which they act, and the general principles of the law of principal and agent regulate in most respects the relationship of the company and its directors. ,, 301 It was held in Gulab Singh vs Punjab Zamindara Bank (1) and in Jasuwant Singh vs V.V. Puri (2) that a director is an agent of the company. Both Dalmia and Chokhani being agents of the company the control, if any, they had over the securities and the funds of the company, would be in their capacity as agents of the company and would be in the course of Dalmia 's duty as the Chairman and Director or in the course of Chokhani 's duty as a duly appointed agent of the company. If they committed any criminal breach of trust with respect to the securities and funds of the company, they would be committing an offence under ss.409 I.P.C. In view of our opinion with respect to Dalmia and Chokhani being agents within the meaning of section 409 I.P.C. and being entrusted with dominion over the funds of the Bharat Insurance Company in the Banks which comes within the meaning of the words 'property ' in section 409, these appellant would commit the offence of criminal breach of trust under section 409 in case they have dealt with this 'property ' in any manner mentioned in section 405 I.P.C. We may now proceed to discuss the detailed nature of the transactions said to have taken place in pursuance of the alleged conspiracy. It is, however, not necessary to give details of all the impugned transaction. The details of the first few transactions will illustrate how the whole scheme of diverting the funds of the Insurance Company to the Union Agencies was worked. The Union Agencies suffered losses in its shares speculation business in the beginning of August, 1954. The share brokers sent statements of accounts dated August 6, 1954, to Chokhani and (1) A. I.R. (2) A.I.R. 1951 Pu n. 99. 302 made demand of Rs. 22,25,687 13 0 in respect of the losses, The total cash assets of the Union Agencies in all it,; banks and offices at Bombay, Calcutta and Delhi amounted to Rs. 2,67,857 11 7 only. The Union Agencies therefore needed a large sum of money to meet this demand and to meet expected future demands in connection with the losses. At this crucial time, telephonic communications did take place between presumably Dalmia and Chokhani. The calls were made from Telephone No. 45031, which is Dalmia 's number at 3, Sikandara Road, New Delhi to Bombay No. 33726, of Cho khani. Two calls were made on August 7, 1954, three on August 8, two on August 11 and one each on August 13 and August 14, respectively. Of course, there is no evidence about the conversation which took place at these talks. The significance of these calls lies in their taking place during the period when the scheme about the diversion of funds was coming into operation for the first time, but in the absence of evidence as to what conversation took place, they furnish merely a circumstance which is not conclusive by itself. On August 7 and 9, 1954, the Punjab National Bank, Bombay, received Rs. 2,00,000 and Rs. 3,00,000 respectively in the account of the Union Agencies, telegraphically from Delhi. On the same day, Vishnu Prasad, appellant, opened an account with the Bank of India, Bombay, in the name of Bhagwati Trading Company. He gave himself out as the sole proprietor and mentioned the business of the company in the form for opening account as merchants and commission agents '. He made a deposit of Rs. 1, 100 said to have been supplied to him by Chokhani. On August 11, 1954, Vishnu Prasad made another deposit of Rs. 1,100, again said to have 303 been supplied by Chokhani, as the first deposit in the account he opened with the United Bank of India, Bombay, in the name of Bhagwati Trading Company. The business of the company was described in the form for opening account as merchants, piece goods dealers. ' There is no dispute now that Bhagwati Trading Company did not carry on any business either as merchants and commission agents or as merchants and piece goods dealers. Vishnu Prasad states that he acted just at Chokhani told him and did not know the nature of the transactions which were carried on in the name of this company. It is however clear from the accounts and dealings of this company that its main purpose was simply to act in such a way as to let the funds of the Insurance Company pass on to the Union Agencies, to avoid easy detection of such transfer of funds. Chokhani states that he did this business as the Union Agencies needed money at that time. He thought that the Union Agencies would make profit after some time and thereafter pay it back to Bhagwati Trading Company for purchasing securities and therefore he postponed the dates of delivery of the securities to the Insurance Company. He added that in case of necessity be could raise money by selling or mortgaging the shares of the Union Agencies in the exercise of his power of attorney on its behalf. We may now revert to the actual transaction gone through to meet the demands in connection with the losses of the Union Agencies. On August 9, 1954, Chokbani purchased 3% 1963 65 securities of the face value of Rs. 22,00,000 on behalf of the Insurance Company from Naraindas and Sons, Security Brokers. Chokhani entered, into a cross contract with the same firm of brokers 304 for the sale of similar securities of the same face value on behalf of Bhagwati Trading Company. He informed the brokers that the payment of purchase price would be made by the Insurance Company to Bhagwati Trading Company from whom it would get the securities. Thus the actual brokers practically got out of the transaction except for their claim of brokerage. On August 11, 1954, a similar transaction of purchase on behalf of the Insurance Company from the brokers and sale by Bhagwati Trading Company to those brokers, of 3% 1963 65 securities of the face value of Rs. 5,00,000, was entered into by Chokhani. It may be mentioned, to avoid repetition, that Chokhani always acted in such transaction which may be referred to as usual purchase transactions both on behalf of the Insurance Company and on behalf of Bhagwati Trading Company, and that the same arrangement was made with respect to the payment of the purchase price and the delivery of securities. The securities were not delivered to the Insurance Company by Bhagwati Trading Company and yet Chokhani made payment of the purchase price from out of the funds of the Insurance Company. On August 11, 1954, Chokhani got the statement of accounts from the brokers relating to the purchase of securities Worth Rs. 22,00,000. The total cost of those securities worked out at Rs. 20,64,058 6 9. Chokhani made the payment by issuing two cheques in favour of Bhagwati Trading Company, one for Rs. 10,00,000 and the other for the balance, i.e., Rs. 10,64,058 6 9. Needless to say that he utilised the cheques which had already been signed by Raghunath Rai, in pursuance of the arrangement to facilitate transactions on behalf of the Insurance Company. 305 On August 12, 1954, the statement of account with respect to the purchase of securities worth Rs. 5,00,000 was received. The cost worked out to Rs. 4,69,134 15 9. Chokhani made the payment by issuing a cheque for the amount in favour of Bhag wati Trading Company. All these cheques were drawn on the Chartered Bank, Bombay. On August 12, 1954, Vishnu Prasad drew cheques for Rs. 9,00,000 in the account of Bhagwati Trading Company in the United Bank of India. The amount was collected by his father Bajranglal. He drew another cheque for Rs. 9,60,000 in the account of the Bhagwati Trading Company with the Bank of India, Bombay, and collected the amount personally. The total amount withdrawn by these two cheques viz., Rs. 18,60,000 was passed on to the Union Agencies through Chokhani that day. Thereafter Chokhani deposited Rs. 7,00,000 in the account of the Union Agencies with the Bank of India, Rs. 7,00,000, in the account of the Union Agencies with the United Bank of India and Rs. 4,40,000 in the account of the Union Agencies with the Punjab National Bank Ltd. The Punjab National Bank Ltd., Bombay, as already mentioned, had received deposits of Rs. 2,00,000 and Rs. 3,00,000 on August 7 and August 9, 1954, respectively, in the account of the Union Agencies from Delhi. Between August 9 and August 19, 1954, Chokhani made payment to the brokers on account of the losses suffered by the Union Agencies. He issued cheques for Rs. 9,37,473 5 9 between August 9 and August 13, 1954, on the account with the Punjab National Bank. On August 13, he issued cheques on the account of the Union Agency with the United Bank of India in favour of the Bombay brokers on account of the losses of the Union Agencies, for Rs. 7,40,088 5 9. He also issued, between August 13 and August 19., 1954, cheque for Rs. 6,84,833 14 0 on the Bank of India, in favour 306 of the share brokers at Bombay on account of the losses suffered by the Union Agencies. Chokhani informed the head office at Delhi about these purchase transaction of securities worth Rs. 27,00,000, through letter dated August 16, 1954, and along with that letter sent the contract note and statements of accounts received from the brokers. No mentioned was made in the letter about the payment being made to Bhagwati Trading Company through cheques or about the arrangement about getting the securities from Bhagwati Trading Company or about the postponement of the delivery of the securities by that company. On receipt of the letter, Raghunath Rai contacted Dalmia and, on being told that the securities were purchased under the latter 's instructions, made over the letter to the office where the usual entries where made and records were prepared, as had to be done in pursuance of the office routine. Ultimately, the formal confirmation of the purchases was obtained on August 30, 1954, from the Board of Directors at its meeting for which the office note Stating that the securities were purchase under the instruction of the Chairman (Dalmia) was prepared. The office note, Exhibit P. 793, with respect to the purchase of these securities worth Rs. 27,00,000 was signed by Chordia, who was then the Managing, Director of the Bharat Insurance Company. On August 16, 1954, Vishnu Prasad withdrew Rs. 2,200 from the account of the Bhagwati Trading Company with the Bank of India, according to his statement, gave this money to Chokhani in return for the amount Chokhani had advanced earlier for opening accounts for Bhagwati Trading Company with the Bank of India and the United Bank of India. Thereafter, whatever money was in the account of Bhagwati Trading Company with these Banks was the money obtained through the dealings entered into on behalf of Bhagwati Trading Company, the funds 307 for most of which came from the Bharat Insurance Company. On August 18,1954, Vishnu Prasad drew a sum of Rs. 50,000 from Bhagwati Trading Company 's account with the Bank of India and passed on the amount to the Union Agencies through Chokhani. On August 23. 1954, he withdrew Rs. 90,000 from Bhagwati Trading Company 's account with the United Bank of India and Rs. 5,10,000 from its account with the Bank of India and passed on these amounts also to the Union Agencies through Chokhani. Chokhani then issued cheques to telling Rs. 5,88,380 13 0 from August 23 to August 26,1954, on the account of the Union Agencies with the Chartered Bank, Bombay, in favour of the brokers on account of the losses suffered by that company. Thus, out of the total amount of Rs. 25,33,193 6.6 withdrawn by Chokhani from the account of the Bharat. Insurance Company and paid over to Bhagwati Trading Company, Rs. 25,10,000 went to the Union Agencies, which mostly utilised the amount in payment of the losses suffered by it. The Union Agencies suffered further losses amounting to about Rs. 23,00,000. Demands for payment by the brokers were received on September 3, 1954, and subsequent days. The Bharat Insurance Company had no sufficient liquid funds in the Banks at Bombay. There was therefore necessity to deposit funds in the Bank before they could be drawn ostensibly to pay the price of securities to be purchased. This time the transactions of sale of securities held by the Insurance Company and the usual purchase transactions relating to certain other securities were gone through. The details of those transactions are given below. 308 On September 4, 1954, securities of the face value of Rs. 17,50,000 held by the Insurance Company were withdrawn from its Safe custody account with the Imperial Bank of India, New Delhi, by letter Exhibit P. 1351 under the signature of Dalmia. Securities worth Rs. 10,00,000 were 2 1/40% 1954 securities and the balance were 2 1/2% 1955 securities. These securities were then sent to Bombay and sold there. On September 9, 1954, Rs. 6,25,000 were transferred from Delhi to the account of the Insurance Company with the Chartered Bank, Bombay, by telegraphic transfer. Thus the balance of the funds of the Insurance Company with the Char tered Bank rose to an amount out of which the losses of about Rs. 23,00,000 suffered by the Union Agencies could be met. The 1954 securities sold were to mature on November 15, 1954. The 1955 securities would have matured much later. No ostensible reason for their premature sale has been given. On September 6, 1954, Chokhani purchased 3% 1959 61 securities of the face value of Rs. 25,00,000 on behalf of the Insurance Company from M/s. Naraindas & Sons, Brokers. A cross contact of sale of similar securities by Bhagwati Trading Company to the brokers was also entered into. Steps which were taken in connection with the purchase of securities worth Rs. 27,00,000 in August 1954 were repeated. On September 9, 1954, Chokhani issued two cheques, one for Rs. 15,00,000 and the other for Rs. 9,20,875 on the account of the Insurance Company with the Chartered Bank, in favour of Bhagwati Trading Company which deposited the amount of the cheques into its account with the Bank of India, Bombay. Vishnu Prasad passed on Rs. 24,00,000 to the Union Agencies through Chokhani. This amount was utilised in meeting the losses suffered by the Union Agencies to the extent of Rs. 22,81,738 2 0, A sum of Rs. 75,000 was paid 309 to Bennett Coleman Co. Ltd., of which Dalmia was a director and a sum of Rs. 15,000 was deposited in the Punjab National Bank. It is again significant to note that telephonic communication took place between Dalmia 's residence at New Delhi at, Chokhani 's at Bombay, between September 4 and September 10, 1954. There was two communications on September 4, one on September 5, three on September 6 and one on September 10, 1954. The Union Agencies suffered further losses amounting to about Rs. 10,00,000 in the month of September. Again, the accounts of the Union Agencies or of the Insurance Company, at Bombay, did not have sufficient balance to meet the losses and, consequently, sale of certain securities held by the Insurance Company and purchase of other securities again took place. This time, 3% 1957 securities of the face value of Rs. 10,00,000 hold by the Insurance Company in its safe custody deposit with the Chartered Bank, Bombay, were sold on September 21, 1954, and Rs. 9,84,854 5 6, the net proceeds, were deposited in the Bank. On the same day, Chokhani purchased 3% 1959 61 securities of the face value of Rs. 10,00,000 on behalf of the Insurance Company following the procedure adopted in the earlier usual purchase transactions. No telephonic communication appears to have taken place between Delhi and Bombay, on receipt of the demand from the brokers on September 17, 1954, for the payment of the losses, presumably because necessary steps to be taken both in connection with the fictitious purchase of securities, in order to pay money to Bhagwati Trading Company for being made over to the Union Agencies when funds were needed and also or providing funds in the Insurance Company 's account with the Chartered Bank, Bombay, in case the 810 balance was not sufficient to meet the losses, had already been adopted in the previous transactions, presumably, after consultations between Dalmia and Chokhani. This lends weight to the significance of the telephonic communications between Delhi and Bombay in the critical period of August and early September, 1954. To complete the entire picture, we may now mention the steps taken to cover up the non receipt of securities purchased, at the proper time. By November, 19, 1954, securities of the facevalue of about Rs. 80,00,000 bad been purchased by Chokhani on behalf of the Insurance Company and such securities bad not been sent to the head office at Delhi. Raghunath Rai referred the matter to Dalmia and, on his approval, sent a letter on November 19, 1954, to Chokhani, asking him to send the distinctive numbers of those securities. The copy of the letter is Exhibit P. 805. The securities referred to were 3% Loan of 1959 61 of the face value of Rs. 35,00,000, 3% Loan of 1963 65 of the face value of Rs. 27,00,000 and 2 3/40/% Loan of 1960 of face value of Rs. 18,00,000. It was subsequent to this that stock certificates with respect to 3% 1963 65 securities of the face, value of Rs. 27,00,000 arid with respect to 2 3 14% 1960. Loan securities of the face value of Rs. 18,00,000 were received in Delhi. We may now refer to the transactions which led to the obtaining of these stock certificates. The due dates of interest of 3% 1963 65 securities purchased in August 1954 were June 1 and December 1. It was therefore necessary to procure these securities or to enter into a paper transaction of their sale prior to December 1, as, otherwise, the non obtaining of the income tax deduction certificate from the Reserve Bank would have clearly indicated that the Insurance Company did not hold these 311 securities, Chokhani, therefore, entered into a genuine contract of purchase of 3% 1963 65 securities of the face value of Rs. 27,00,000 on behalf of Bhagwati Trading Company with Devkaran Nanjee, Brokers, Bombay, on November 3, 1954. He instructed the brokers to endorse the securities in favour of the Insurance Company, even though the securities were being sold to Bhagwati Trading Company. These securities so endorsed were received on November 24, 1954, and were converted into inscribed stock (Stock Certificate Exhibit P. 920) from the Reserve Bank of India on December 7,1954. The stock certificate does not mention the date on which the securities were purchased and therefore it existence could prevent the detection of the fact that these securities were not purchased in August 1954 when, according to the books of the Insurance Company, they were shown to have been purchased. The Insurance Company did not ostensibly pay for the purchase of these shares but partially paid for it through another share purchase transaction. In order to enable Bhagwati Trading Company to pay the purchase price, Chokbani paid Rs. 16,00,000 to it from the account of the Bharat Union Agencies with the Banks at Bombay, and Rs. 10,08,515 15 0 from the account of the Insurance Company with the Chartered Bank by a fictitious purchase of 2 1/2% 19611 securities of the face value of Rs. 11,00,000 on behalf of the Insurance Company. These 2 1/2% 1961 securities of the face value of Rs. 11,00,000 were purchased by Chokhani on November 16, 1954. by taking a step similar to those taken for the purchase of securities in August and September, 1954, already referred to. Interest on the 2 3/4% Loan of 1960 of the face value of Rs. 18,00,000 was to fall due on January 15, 1955. Both on account of the necessity for obtaining the interest certificate and also on 312 account of the expected check of securities by the auditors appointed for auditing the accounts of the Insurance Company for the year 1954, it became necessary to procure these securities or to sell them off. Chokhani purchased, on December 9, 1954, 2 3/4% 1960 securities of the face value of Rs. 18,00,000 on behalf of Bhagwati Trading Company. The purchase price was paid out of the funds of the Union Agencies and Bhagwati Trading Company. The securities were, however, got endorsed in the name of the Insurance Company. Chokhani got the securities sometimes about December 21, 1954, and, therefore, got them converted into stock certi ficates which were then sent to the head office at Delhi. There still remained 3% 1959 61 securities of face value of Rs. 35,00,000 to be accounted for. They were purchased in September, 1954, as already mentioned, but had not been received up to the end of December. On December 27, 1954, Chokhani purchased 2 3/4% 1962 securities of the face value of Rs. 46,00,000, in two lots of Rs. 11,00,000 and Rs. 35,00,000 respectively, on behalf of the Insurance Company. He also entered into the usual cross contract with the brokers for the sale of those securities on behalf of the Union Agencies. This was a fictitious transaction, as usual, and these securities were not received from the Union Agencies. On the same day, Chokhani entered into a contract for the sale of 3% 1959 61 securities of the face value of Rs. 35,00,000 on behalf of the Insurance, Company and also entered into a cross contract on behalf of the Union Agencies for the purchase of these securities from the same brokers. As these securities did not exist with the Jnsuranco Company, these transactions were also paper transactions. We need not give details of the passing of money from one concern to the other in connection with these transactions. For purposes of audit the 1959 61 securities of the face value of 313 Rs.35,00,000 had been sold. Now securities viz., 2 3/4% 1962 securities of the face value of Rs. 46,00,000 had been ostensibly purchased. The auditors could demand inspection of these newly purchased securities. Chokhani therefore entered into another purchase transaction. This time a genuine transaction for the purchase of 2 3/4% 1962 securi ties of the face value of Rs 46,00,000 was entered into on January It, 1955. The purchase price was paid by the sale of 3% 1957 securities of the face value of Rs. 46,00,000 which the Insurance Company possessed. For this purpose , Chokhani withdrew these securities of the face value of Rs. 8,25,000 from the Chartered Bank, Bombay, and Rs. 37,75,000 worth of securities were sent to Bombay from Delhi. These securities were then converted into inscribed stock. The Insurance Company was now supposed to have purchased 2 3/4% 1962 securities of the face value of Rs. 92,00,000 having purchased Rs.416,00,000) worth of securities in December 1954 and Rs. 46,00,000 worth of securities in January 1955. It possessed securities worth Rs. 46,00,000 only and inscribed stock certificate with respect to that could serve the purpose of verifying the existence of the other set of Rs. 46,00,000 worth of securities. These transactions are sufficient to indicate the scheme followed by Chokhani in the purchase and sale of securities on behalf of the Insurance Company. It is clear that the transactions were not in the interests of the Insurance Company but were in the interests of the Union Agencies inasmuch as the funds were provided to it for meeting its losses. It is also clear that the system adopted of withdrawing the funds of the Insurance Company ostensibly for paying the purchase price of securities after the due date of payment of interest and selling the securities off, if not actually recouped from the funds of the Union Agencies or 314 Bhagwati Trading Company prior to the next date of payment of interest, was not in the interests of the Insurance Company. When, however, the sale price could not be paid out of the funds of the Union Agencies or Bhagwati Trading Company, Chokhani, on behalf of the Insurance Company entered into a fresh transaction of purchase of securities which were not actually received and thus showed repayment of the earlier funds though out of the funds withdrawn from the same company (viz., the Insurance Company) ostensibly for paying the purchase price of newly purchased securities. Turning to the evidence on record, the main statement on the basis of which, together with other circumstances, the Courts below have found that Dalmia had the necessary criminal intent as what Chokhani did was known to him and was under his instructions, is that of Raghunath Rai, Secretary cum Account of the Bharat Insurance Company. Mr Dingle Foot has contended firstly that Raghunath Rai was an accomplice of the alleged conspirators and, if not, he was a witness whose testimony should not, in the circumstances be believed without sufficient corroboration which does riot exist. He has also contended that the Courts below fell into error in accepting the statements made by him which favoured the prosecution case without critically examining them, that they ignored his statements in favour of the accused for the reason that he was under obligation to Dalmia and ignored his statements inconsistent with his previous statement as he was not confronted with them in cross examination. An accomplice is a person who participates in the commission of the actual crime charged against an accused. He is to be a particleboard. There are two cases, however, in which a person has been held to be an accomplice even if he is not a particeps criminis. Receivers of stolen property 315 are taken to be accomplices of the thieves from whom they receive goods, on a trial for theft. Accomplices in previous similar offences committed by the accused on trial are deemed to be accomplices in the offence for which the accused is on trial, when evidence of the accused having committed crimes of identical type on other occasions be admissible to prove the system and intent of the accused in committing the offence charged Davies Director of Public Prosecution8 (1). The contention that Raghunath Rai was an accomplice is mainly based on the facts that (i) Raghunath Rai did not produce the counterfoils of the cheques for the inspection of the auditors, though asked for by them, in spite of the fact that the counterfoils must have come to Delhi during the period of audit; (ii) the alleged scheme of the cons pirators could not have been carried out without his help in signing blank cheques which were issued by Chokhani subsequently. The mere signing of the blank cheques is hardly an index of complicity when the bank account had to be operated both by Chokhani and Raghunath Rai, jointly. Raghunath Rai had to sign blank cheques in order to avoid delay in payments and possible occasional falling through of the transactions. No sinister retention can be imputed to Raghunath Rai on account of his signing blank cheques in the expectation that those cheques would be properly used by Chokhani. The counterfoils have not been produced and there is no evidence that they showed the real state of affairs, i. e., that the cheques were issued to Bhagwati Trading Company and not to the brokers from whom the securities were purchased. It is not expected that the name of Bhagwati Trading Company would have been written on the counterfoils of the cheques when its existence and (1) L. R. 316 the part it took in the transactions were to be kept secret from the head office. When counterfoils were sent for in August, 1955, they were not received from Bombay. Chokhani states that he did not get that letter. Moreover, counterfoils reach the head office after a long time and there is no particular reason why Raghunath Rai should notice the counterfoils then. He does not state in his evidence that he used to look over the counterfoils when the cheque books came to him for further signatures. We do not therefore agree that Raghunath Rai was an accomplice. Even if it be considered that Raghunath Rai 's evidence required corroboration as to the part played by Dalmia, the circumstances to which we would refer later in this judgment, afforded enough corroboration in that respect. Raghunath Rai made a statement. Exhibit P. 9, before Annadhanam on September 20, 1955. He made certain statements in Court which were at variance with the statement made on that occasion. This variation was not taken into consideration in assessing the veracity of Raghunath Rai as he had not been cross examined about it. The argument of Mr. Dingle Foot is that such variation, if taken into consideration, considerably weakens the evidence of Raghunath Rai. He has urged that no cross examination of Raghunath Rai was directed to the inconsistencies on any particular point in view of the general attack on his veracity through cross examination with respect to certain matters. He has contended that in view of section 155 of the Indian Evidence Act, any previous statement of a witness inconsistent with his statement in Court, if otherwise proved, could be used to impeach his credit and that therefore the Courts below were not right 317 in ignoring the inconsistencies in the statement of Raghunath Rai merely on the ground that they were not put to him in cross examination. On the other hand, the learned Solicitor General contends that section 155 of the Indian Evidence Act is controlled by section 145 and that previous inconsistent statements not put to the witness could not be used for impeaching his credit. We do not consider it necessary to decide this point as we are of opinion that the inconsistent statements referred to are not of any significance in impeaching the credit of Raghunath Rai. The specific inconsistent statements are : (i) 'I never of my own accord send securities to Bombay nor am authorised to do so ': In Court Raghunath Rai said that certain securities were sent by him to Bombay on his own accord because those securities were redeemable at Bombay and the maturity date was approaching. (ii) Before the Administrator, Raghunath Rai had stated: 'I cannot interfere in the matter as, under Board Resolution, Chokhani is authorised to deal with the securities. Chokhani always works under instructions from the Chairman. ' In Court, however, he stated that there was no resolution of the Board of Directors authorising Chokhani to sell and purchase securities. The misstatement by Raghunath Rai, in his statement P. 9 to the Investigator made on September 20, 1955. about Chokhani 's being authorised by a Board resolution to deal with the securities, is not considered by Dalmia to be a false statement as he himself stated, in answer to question No. 21, that such a statement could possibly be made by Raghunath Rai in view of the Board of Directors considering at the meeting the question whether Chokhani be authorised to purchase and sell securities on behalf of the company in order to make profits. (iii) 'Roughly 1 3/4 chores of securities were sent to Bombay from here during the period from 318 April 1955 to June 1955. The period was wrong and was really from July to August 1955. Raghunath Rai admitted the error and said that he had stated to Annadhanam without reference to books. (iv) 'Securities are sent to Chokhani at Bombay through a representative of Dalmia. The statement is not quite correct as securities were sent to Bombay by post also. Raghunath Rai stated that on the receipt of the advice from Chokhani about the purchase or sale of securities, he used to go to Dalmia on the day following the receipt of the advice for confirmation of the contract of purchase or sale of securities and that after Dalmia 's approval the vouchers about the purchase of those securities and the crediting of the amount of the sale price of those securities to the account of the Insurance Company with the Chartered Bank, as the case may be, used to be prepared. Kashmiri Lal and Ram Das, who prepared the vouchers, describe the procedure followed by them on receipt of the advice but do not state anything about Raghunath Rai 's seeking confirmation of the purchase transactions from Dalmia and therefore do not, as suggested for the appellants, in any way, contradict Raghunath Rai. It is urged by Mr. Dingle Foot that it was somewhat unusual to put off the entries with respect to advises received by a day, that the entries must have been made on the day the advices were received and that in this manner the entries made by these clerks contradict Raghunath Rai. A witness cannot be contradicted by first supposing that a certain thing must have taken place in a manner not deposed to by any witness and then to find that was not consistent with the statement made by that witness. Further, we are of opinion that there could be no object in making consequential entries 319 on receipt of the advice about the purchase of securities if the purchase transaction itself is not approved of and is consequently cancelled. The consequent entries were to be with respect to the investments of the Insurance Company and not with respect to infructuous transactions entered into by its agents. It has also been urged that if Dalmia 's confirmation was necessary, it was extraordinary that no written record of his confirming the put chase of securities was kept in the office. We see no point in this objection. If confirmation was necessary, the fact that various entries were made consequent on the receipt of advice is sufficient evidence of the transaction being confirmed by Lalmit, as, in the absence of confirmation, the transaction could not have been taken to be complete. Further, office notes stating that securities had been purchased or sold 'under instructions of the Chairman ' used to be prepared for the meeting of the Board of Directors when the matter of confirming sale and purchase of securities went before it. The fact that office notes mentioned that the securities had been purchased under the instructions of the Chairman is the record of the alleged confirmation. The proceedings of the meeting of the Board of Directors with respect to the confirmation of the purchase and sale of securities do not mention that action was taken on the basis of the office notes. Minutes with respect to other matters do refer to the office notes. This does not, however, mean that office notes were not prepared. Confirmation of the purchase and sale of the shares was a formal matter for the Board. All the office notes, except one, were signed by Raghunath Rai. The one not signed by him is Exhibit P. 793. It is signed by Chordia and is dated August 18,1954. This also mentions under instructions of the Chairman certain shares have been 320 purchased '. Chordia was a relation of Dalmia and had no reason to write the expression 'Under instructions of the Chairman ' falsely. Such a note cannot be taken to be a routine note when the power to purchase and sell securities vested in Chordia as Managing Director of the company. Clause (4) of article 13 of the Bye laws empowered the Managing Director to transfer, buy and sell Government securities. When Chordia, the Managing Director, wrote in this office note that securities were purchased under the instructions of the Chairman, it can be taken to be a true statement of fact. It is true that he has not been examined as a witness to depose directly about his getting it from Dalmia that the purchase of securities referred to in that note was Under his instructions. This does not matter as we have referred to this office note in connection with Raghunath Rai 's statement that office notes used to be prepared after Dalmia 's statement that the particular purchase of shares was under his instructions. The statements made by Raghunath Rai which are said to go in favour of the accused may now be dealt with. Raghunath Rai was cross examined with respect to certain letters he had sent to Chokhani. He stated, in his deposition on July 29, 1958, that Dalmia accepted his suggestion for writing to Chokhani to send him the distinctive numbers of the securities which had been purchased, but not received at the head office, and that when he reported non compliance of Chokhani in communicating the distinctive numbers and suggested to Dalmia to ring up Chokhani to send the securities to the head office, Dalmia agreed. This took place in November and December 1954. Dalmia 's approval of the suggestion does not go in his favour. He could not have refused the suggestion. Raghunath Rai also stated that in September or October 1954 there was a talk between hier, 321 K. L. Gupta and Dalmia about the low yield of interest on the investments of the Insurance Company and it was suggested that the money be invested in securities, shares and debentures. Dalmia then said that he had no faith in private shares and debentures but had faith in Government securities and added that he would ask Chokhani to invest the funds of the Insurance Company in the purchase and sale of Government securities. He, however, denied that Dalmia had said that the investment of funds would be in the discretion of Chokhani, and added that Chokhani was not authorised to purchase or sell securities on behalf of the Insurance Company unless he was authorised by the Chairman. The statement does not support Dalmia 's authorising Chokhani to purchase and sell securities in his discretion. Another statement of Raghunath Rai favourable to Dalmia is said to be that according to him he told the auditors on September 9, 1955, that the securities not then available were with Cbokhani at Bombay from whom advices about their purchase had been received. Annadhanam stated that Raghunath Rai had told him that Dalmia would give the explanation of the securities not produced before the auditors. There is no reason to prefer Raghunath Rai 's statement to that of Annadhanam. Annadhanam 's statement in the letter Exhibit P. 2 about their being informed that in March, 1954, after the purchase, the securities were kept in Bombay in the custody of Chokhani refer to what they were told in the first week of January, 1955, and not to what Raghunath Rai told him on September 9, 1954. Raghunath Rai stated that on one or two occasions be, instead of going to Dalmia, talked with him on telephone regarding the purchase and sale of securities by Chokhani and that Dalmia told him on telephone that be bad instructed for the purchase 322 and sale of securities and that he was confirming the purchases or sales. This does not really favour Dalmia as Raghunath Rai maintains that Dalmia did confirm the purchase or sale reported to him. It is immaterial whether that was done on telephone or on Raghunath Rai actually meeting him. Questions put to the Administrator, Mr. Rao, in cross examination, implied that Raghunatb Rai was a reliable person and efforts to win him over failed. It was suggested to the Administrator that the reasons for the appointment of Sundara Rajan as the Administrator 's Secretary was that he wanted to conceal certain matters from Raghunath Rai. His reply indicated different reasons for the appointment. Another suggestion put to him was that Raghunath Rai offered to retire, but he kept his offer pending because of this case. This suggestion too was denied. It was brought out in the cross examination of Raghunath Rai that he was in a position in which he could be influenced by the Administrator. Raghunath Rai was using the office car. Its use was stopped by the Administrator in January, 1956. He was not paid any conveyance allowance. In April, 1958, he made a representation to the Administrator for the payment of that allowance to him. The Administrator passed the necessary order in May, 1958, with retrospective effect from January 1956. The amount of conveyance allowance was Rs. 75 per mensem. Raghunath Rai could not give any satisfactory explanation as to why he remained silent with regard to his claim for conveyance allowance for a period of over two years, but denied that he was given the allowance with retrospective effect in order to win him over to the prosecution. Raghunath Rai applied for extension of service in the end of 1956 or in the beginning of 323 1957 and, in accordance with the resolution passed on August 17, 1954, by the Board of Directors, his service was extended up to 1961. The Administrator forwarded the application to the higher authorities. This matter had not been decided by July 29, 1958. The amount of his gratuity and provident fund in the custody of the Insurance Company amounted to Rs. 35,000. We do not think that the Administrator had any reason to influence Raghunath Rai 's statement and acted improperly in sanctioning oar allowance to him retrospectively and would have so acted with respect to Raohunath Rai 's gratuity if Raghunath Rai had not made statements supporting the prosecution case. Raghunath Rai stated on July 29, 1958, that in July, 1955, when he informed Dalmia that the bulk of the securities were at Bombay and the rest were at Delhi, Dalmia asked him to write to Chokhani to deposit all the securities in Bombay in the Chartered Bank. At this he told Dalmia that if the sale and purchase of securities was to be carried on as hithertofore, there was no use depositing them in the Bank and thus pay frequent heavy withdrawal charges, and suggested that the securities could be deposited in the Bank if the sale and purchase of them had to be stopped altogether and that Dalmia then said that the securities should be sent for to Delhi in the middle of December, 1955 for inspection by the auditors. Raghunath Rai was re examined on July 30 and stated that the aforesaid conversation took place on July 14, 1955, and added that he had, in the same context, a further talk with Dalmia in August, 1955. The Public Prosecutor, with the permission of the Court then questioned him 324 about the circumstances in which he had to go a second time to Dalmia and talk about the matter. His reply was that he had the second talk as the securities purchased in May, 1955, and those purchased in July and August, 1955, had not been received at the head office. He asked Dalmia to direct Chokhani to deposit all the securities in the Chartered Bank or to send them to Head Office. Dalmia then said that the sale and purchase of securities had to be carried on for some time and therefore the question of depositing those securities in the Bank or sending them to the head office did not arise for the time being and that the securities should be sent for to the head office in December, 1955. Raghunath Rai thus made a significant change in his statement. On July, 29,1958, he opposed the direction of Dalmia for writing to Chokhani to deposit the securities in the Bank as that would entail heavy withdrawal charges in case the sale and purchase of securities were not to be stopped while, according to his statement the next day, he himself suggested to Dalmia in August, 1955, that Chokhani be asked to deposit all the securities in the Bank or to send them to the head office. He denied the suggestion that he made this change in his statement under pressure of the Police. The cross examination was really directed to show that he had been approached by the police between the close of his examination on July 29 and his further examination on July 30, 1958. Raghunath Rai admitted in court that after giving evidence he went to the room allotted in the Court building to the Special Police Establishment and that the Investigating Officer and the Secretary to the Administrator of the Insurance Company were there. He went there in order to take certain papers which he had kept there. He, however, had not brought any papers on July 30 as, accord 325 ing to him, his main cross examination had been over. He however denied that he had been dictated notes by the police in order to answer questions in cross examination or that be remained with the police till 9 p. m. or that the Secretary to the Administrator held out a threat about the forfeiture of his gratuity in case be did not make a statement favourable to the prosecution. We see no Reason for the police to bring pressure on Raghunath Rai to introduce falsely the conversation in August. Between July 14, 1955, and middle of August, 1955, the head office learnt of the purchase of securities of the face value of Rs. 74,00,000 and again, on or about August 26, of the purchase of securities of the face value of Rs. 40,00,000. A further conversation in August is therefore most likely as deposed to. The main fact remains that Dalmia said that the securities be sent for in December, 1955, which implies his knowledge of the transactions in question. We are of opinion that the discrepancies or contradictions pointed out in Raghunath Rai 's statement are not such as to discredit him and make him an unreliable witness and that he is not shown to be under the influence of the prosecution. Further, his various statements connecting Dalmia with the crime, find corroboration from other evidence. Letter Exhibit P. 1351 dated September 4, 1954, was sent to the Imperial Bank of India, Delhi Branch, under the signature of Dalmia as Chairman. The letter directed the bank to deliver certain securities to the bearer. Dalmia admits his signatures on this document and also on the letter Exhibit P. 1352 acknowledging the receipt of the securities sent for, thus corroborating Raghunath Rai 's statement that the securities were withdrawn under his instructions. 326 Letters Exhibit D. 3, dated March 16, 1955, and P. 892 dated August 5, 1955, from Raghunath Rai to Chokhani, mentioned that the stock certificates were being sent under the instructions of the Chairman. They corroborate Raghunath Rai 's statements in Court of the dispatch of these stock certificates under Dalmia 's instructions. He had no reason to use this expression if he was sending them on his own. It is true that the date on which the Chairman gave the instruction is not proved, but it stands to reason that the stock certificates must have been despatched soon after the receipt of the instruction from the Chairman. it cannot be presumed that in such transactions there could be such delay as would make statement in these letters not corroborative evidence under section 157, of the Evidence Act which provides that previous statements made at or about the time a fact took place can be used for corroborating the statement in Court. Chokhani 's statement that he did not mention the name of Bhagwati Trading Company in his letters to the head office as be did not want Dalmia to know about the dealings with Bhagwati Trading Company, implies that in the ordinary course of business the information conveyed in those letters would be communicated to Dalmia and thus tends to support Raghunatb Rai 's statement that he used to visit Dalmia on receipt of the statement of account and inform him about the purchase or sale of the securities. Chokhani had been inconsistent about Raghunath Rai 's later knowledge of the existence of Bhagwati Trading Company. In answer to question No. 66, on November 13, 1958, he stated : "I did not contradict the statement made in Ex xi :P. 813 that cheque No. B564809 327 dated 17 11 54 had been issued in favour of Narain Das and Sons although that cheque had in fact been issued in favour of Bhagwati Trading Company and not in favour of Narain Das and Sons because those at the Head Office did not know anything about Bhagwati Trading Company". In answer to question No. 149, on November 14, 1958, he stated: "I did not mention the name of Bhagwati Trading Company in my letters addressed to the Head Office of the Bharat Insurance Company as the party with whom there were cross contracts because Raghunath Rai would not have known as to what was Bhagwati Trading Company. I also did not mention the name of Bhagwati Trading Company in my letters to the Head Office of the Bharat Insurance Company because I did not want Shri Dalmia to know that I was having dealings with Bhagwati Trading Company. I also want to add that Raghunath Rai must have known that the cross contracts were with Bhagwati Trading Company because the name of Bhagwati Trading Company was mentioned as the payee on the counterfoils of the cheques issued in favour of Bhagwati Trading Company. " Chokhani seems to have attempted to undo the effect of his statement on November 13, but being of divided mind, made inconsistent statements even on November 14, 1958. He was in difficult position. He attempted to show that Dalmia did not know about Bhagwati Trading Company and also to show that Raghunath Rai had reasons to know about it and was therefore in the position of an Accomplice, a stand which is also taken by Dalmia 328 We may now deal first with the case of Chokhani, appellant. Chokhani has admitted his entering into the various transactions of purchase and sale and to have set up Bhagwati Trading Company for convenience to carry out the scheme of diverting the funds of the Insurance Company to the Union Agencies by way of temporary loan. His main plea is that he had no attention to cause loss to the Insurance Company and did not know that the way he arranged funds for the Union Agencies from the Insurance Company was against law. He contends that he had no dishonest intentions and therefore did not commit any of the offences he had been charged with, and convicted of. Learned counsel for Chokhani has urged two points in addition to some of the points of law urged by learned counsel for Dalmia. He urged that the transactions entered into by Chokhani were ordinary genuine commercial transactions and that there was no evidence of Chokhani 's acting dishonestly in entering into those transactions. It is further said that the High Court recorded no finding, on the latter point though it was necessary to record such a finding, even though this point was not seriously urged. In support of the contention that the purchase and sale transactions were genuine commercial transactions, it is urged that to meet the losses of the Union Agencies Chokhani was in a position to sell the shares held by it or could have raised the money on its credit. He did not sell the shares as they were valuable and as their sale would have affected the credit of the Union Agencies. Chokhani had been instructed in September, 1954, that the yield from the investment of the Insurance Company was not good and that the funds of the Insurance Company be invested in securities. Such instructions are said to have been given when he was authorised by Dalmia to purchase and sell securities 329 on behalf of the Insurance Company. It is suggested that these instructions were given in 1953 and not in 1954 when Dalmia was going abroad. In view of this authority, Chokhani decided on a course of action by which he could invest the insurance money in securities and also help the Union Agencies. It is submitted that it was not necessary to mention Bhagwati Trading Company to the head office as the Insurance Company was going to suffer no loss and was simply concerned in knowing of the sale and purchase transactions. Chokhani 's payment of the purchase price in anticipation of the delivery of the securities, was bona fide. We have already expressed the opinion that the transaction in connection with the investment of the funds of the Insurance Company were not bonafide purchase and sale transactions. They were transactions with a purpose. They were motivated in the interests of the Union Agencies and not in the interests of the Insurance Company. The mere fact that on account of the nondelivery of securities within a reasonable time of the payment of the purchase money made the brokers or Bhagwati Trading Company or both of them liable to an action, does not change the nature of the transactions. That liability can co exist with the criminal liability of Chokhani if the transactions were such which could amount to his committing breach of trust. In fact, the offence of breach of trust is not with respect to his entering into the sale and purchase transactions. It is really on the basis of his paying the money out of the Insurance Company 's funds to the Union Agencies through Bhagwati Trading Company, in contravention of the manner in which he was to deal with that money. These purchase and sale transactions were just a device for drawing on those funds. We do not believe that Chokhani really intended to purchase the securities though he did purchase 330 some, in certain circumstances, and that the nondelivery of the securities was not a case of just his slightly postponing the delivery of the securities. No reason is given why such a concession should have been made to the seller of the securities and the period during which such purchased securities remained undelivered is much longer than what can be said to be a reasonable period during which purchased securities for ready delivery should be delivered. The fact, if true, that the Insurance Company suffered no monetary loss on account of the purchase and sale transactions and the passing of its money to the Union Agencies, does not suffice to make the transaction an honest one. The gain which the Union Agencies made out of the money it got from the Insurance Company was wrongful gain. It was not entitled to profit by that money. One is said to act dishonestly when he does any thing with the intention of causing wrongful gain to one person or wrongful loss to another. Wrongful gain means gain by unlawful means of property to which the person gaining is not legally entitled and wrongful loss is loss by unlawful means of property to which the person using it is legally entitled. It is urged that Chokhani 's keeping Bhagwati Trading Company secret from Delhi was not the result of a guilty conscience, but could be due to his nervousness or fear. We do not agree with this suggestion. He had nothing to fear when he was acting honestly and, according to him, when he was doing nothing wrong. It is further submitted that what Chokhani did amounted simply to the mixing of the funds of the Insurance Company and the Union Agencies. We do not think that this would bethe correct interpretation of what Chokhani did. It was not a case of mixing of funds but was a case of making 331 over the funds of the Insurance Company to the Union Agencies. The fact that the Administrator did not cancel any contract entered into on behalf of the Insurance Company under the powers given to him by section 52(c) of the , does not mean that every such contract was in the interest of the Insurance Company. The Administrator has stated that he did not know the legal position as to whether those contracts stood or not. Of the points of law urged for Chokhani, we have already dealt with those relating to the jurisdiction of the Delhi Court to try the various offences, to the content of the words 'property ', dominion ' and agency ' in section 409, I. P. C. The only other points raised are that the offence under section 477 A could not be said to be committed in pursuance of the conspiracy and that it was not a case of one conspiracy but of several conspiracies. The charge under section 477 A, 1. P. C. is based on the letters written by Chokhani from Bombay to Delhi intimating his entering into the contracts of purchase of securities and indicating that cheques had been issued in payment to the brokers. It is true that these letters did not specifically state that the cheques had been issued to the brokers, but that is the implication when the letters refer to the contracts and the statements sent along with them and which relate simply to the transactions between the Insurance Company and the brokers and in no way indicate the cross contracts between the brokers and Bhagwati Trading Company. It is further said that the payment to Bhagwati Trading Company was as an agent of the brokers. There is no evidence that the brokers appointed Bhagwati Trading Company as their agent for the purpose. The evidence is that on Chokhani 's representation that the Insurance Company would 332 pay to Bhagwati Trading Company and get the securities from Bhagwati Trading Company that the brokers neither got the price nor delivered the securities. It is also contended that Chokhani was not a ,servant ' of the Insurance Company and therefore does not come within section 477 A. 1. P. C. which makes certain conduct of a clerk, officer or servant an offence Chokhani was a servant of the Insurance Company as he was its Agent and received payment for doing work as an agent. His being a full time servant of the Union Agencies does not mean that he could not be a servant of any other company, or other employer. We do not agree with the contention that it was a case of several conspiracies, each transaction to meet the losses, as they occurred, giving rise to an independent conspiracy. The conspiracy was entered into in the beginning of August, 1954, when such circumstance arose that funds had to provided to the Union Agencies to meet its losses. The conspiracy must have been to continue up to such time when it be possible to anticipate that such a situation would no more arise. Similar steps to meet the losses were taken whenever the occasion arose. The identity of purpose and method is to be found in all the transactions and they must be held to have taken place in pursuance of the original conspiracy. We next come to the case of Vishnu Prasad, appellant. He was the sole proprietor of Bhagwati Trading Company. His main defence is that he was ignorant of the various transactions entered into by Chokhani on behalf of Bbagwati Trading Company and that it was Chokbani who kept the books of accounts and entered into those transactions. The courts below have found that he knew of transactions and the nature of the conspiracy. 333 We agree with this opinion. There is sufficient material on record to establish his knowledge and part in the conspiracy. Bhagwati Trading Company came into existence just when the Union Agencies suffered losses and was not in a position to pay them and, consequently, there arose the necessity for Dalmia and Chokhani to devise means to raise funds for meeting those losses. Vishnu Prasad opened the banking accounts in two banks at Bombay on August 9 and August 11, 1954, depositing the two sums of Rs. 1,100 each in each of the two banks. He states that he got this money from Chokbani. The money was, however withdrawn after a short time and paid back to Chokhani and no further contribution to the funds of the Bhagwati Trading Company was made on his behalf. The Company functioned mainly on the amounts received from the Insurance Company. Vishnu Prasad, therefore, cannot be said to be quite innocent of the starting of the company and the nature of its business. He started, in answer to question No. 24: "I started business in the name of Bhagwati Trading Company in 1953, or beginning of 1954. 1 however did no business in the name of that company. G. L. Chokhani stated that I should do business for the purchase or sale of securities." and in answer to question No. 26 he stated that he had no knowledge about Chokhani 's entering into contracts on behalf of the Bharat Insurance Company for the purchase of securities and his entering into crose contracts with the same firm of brokers for the sale of those securities on behalf of Bhagwati Trading Company but admitted that he knew that Chokhani was doing business for the purchase and sale of securities on behalf of Bhagwati Trading Company. He expressed ignorance 334 about similar future contracts for purchase of securities on behalf of the Insurance Company and cross contracts for the sale of those securities on behalf of Bhagwati Trading Company. Vishnu Prasad, however, made a statement at the close of the day when he had made the above statement, and said: "In answer to question No. 24 I want to state that I did not start business of Bhagwati Trading Company in 1953 or the beginning of 1951 but only intended to start that business. " The latter statement deserves no acceptance and is a clear indication that the implications of his earlier statement worked on his mind and he attempted to indicate that he was not even responsible in any way for the starting of the business of Bhagwati Trading Company. Bhagwati Trading Company did come into existence and ostensibly did business. The latter statement therefore cannot be true. Vishnu Prasad further knew, as his answer to question No. 157 indicates, that Chokhani did shares speculation business at Bombay. He, however, stated that he did not know on behalf of which company he did that business. What Vishnu Prasad actually did in connection with the various transactions which helped in the diversion of the funds of the Insurance Company to the Union Agencies has to be looked at in this background. He cashed a number of cheques issued on behalf of the Insurance Company and made over that money to Chokhani, who passed it on the Union. Agencies. He issued cheques on behalf of Bhagwati Trading Company in favour of Bharat Union Agencies after the amounts of the cheques of the Insurance Company in favour of Bhagwati Trading Company had been deposited in the Bank. Some of 335 these cheques issued in favour of Union Agencies were filled in by Vishnu Prasad himself and therefore he must have known that he was passing on the money to the Union Agencies. In fact, some of the cheques issued on behalf of Bhagwati Trading Company in favour of the Union Agencies were deposited in the bank by Vishnu Prasad himself It is therefore not possible to believe that Vishnu Prasad did not know that the amounts which his company viz., Bhagwati Trading Company, received from the Insurance Company must have purported to be on account of securities sold to the Insurance Company, as that was the business which Bhagwati Trading Company professed to do and, according to him, he knew to be its business, He knew that most of this amount was passed on to the Union Agencies. Both these facts must have put him on enquiry even if he did not initially know of the nature of the business which brought in the money to, and took out the money from, Bhagwati Trading Company. He is expected to knew that the Insurance Company was not likely to purchase securities so frequently. If he had made enquiries, he would have learnt about the nature of receipts and payments and in fact we are inclined to the view that he must have known of their nature and that it is not reasonable that he would be completely in the dark. The business of Bhagwati Trading Company is said to have been started as Vishnu Prasad was not taking interest in the other business. This should indicate that he must have evinced interest in the activities of Bhagwati Trading Company which continued for over a year and which made him receive and dispose of lakhs of Rupees. Surely, it is not expected that he would have made no effort to know what is required to be know by one earring on business for the purchase and sale of securities, and any attempt to have known this would have 336 necessarily led him to know that securities were being purchased on behalf of the Insurance Company and were not delivered to it and that Bhagwati Trading Company purchased no securities from the Union Agencies and that any payment by it to the latter was for something which B wait Trading Company was not liable to pay. It follows that he must have known that money was being received from the Insurance Company for nothing which was due to Bhagwati Trading company from that company and that most of that money was being paid to the Union Agencies for payment of which Bhagwati Trading Company had no liability and that the net result of the transactions of receipt of money from the Insurance Company and payment of it to the Union Agencies was that Bhagwati Trading Company was acting to help the diversion of funds from the Insurance Company to the Union Agencies. We therefore hold that Vishnu Prasad has been rightly found to be in the conspiracy. We may now deal with the case of Dalmia, appellants The fact that the funds of the Bharat Insurance Company were diverted to Union Agencies by the transactions proved by the prosecution, is not challenged by Dalmia. His main contention is that he did not know what Chokhani had been doing in connection with the raising of funds for meeting the losses of the Union Agencies. There is, however, ample evidence to indicate that Dalmia knew of the scheme of the transactions and was a party to the scheme inasmuch as the transactions were carried through under his instructions and approval: The facts which have a bearing on this matter are: (1) Dalmia had the clearest motive to devise means for meeting the losses of the Union Agencies. 337 (2) Dalmia actually looked after the share business of the Union Agencies at Calcutta and Delhi. He had knowledge of the losses of the Union Agencies. (3) The frequency of telephonic calls between him and Chokhani during the period when the losses took place and steps were taken to meet them, especially during the early stages in August and September, 1954, when the scheme was being put into operation, and in July and August, 1955, when there bad been heavy and recurring losses. (4) Dalmia 's informing the Imperial Bank, Delhi, on September 4, 1954, about his powers to deal with securities and actually withdrawing securities that day, which were shortly after sold at Bombay and whose proceeds were utilised for meeting the losses. (5) The gradually increasing retention of securities in the office of the Insurance Company and consequently the gradually reduced deposit of securities in the Banks. (6) The transfer of securities held by the Insurance Company from Delhi to Bombay when funds were low there to meet the losses. (7) The purchase and sale of securities in the relevant period in order to meet the losses were under his instructions. (8) A larger use of converting securities into inscribed stock certificates which was used for concealing the disclosure of the interval between the date of purchase of the securities which were then not received, and the date when those securities were recouped later. (9) Dalmia 's annoyance and resentment on September 9, 1955, when the auditors made a surprise inspection of the office of the insurance company and wanted to see the securities, 338 (10) His conduct on September 15, 1955. (11) His not going to meet Mr. Kaul on September 16, 1955, and instead, sending his relatives to state what was not the full and correct statement of facts which, according to his own statements, were known to him by then. (12) His confession P. 10 together with the statement Exhibit p. 11 and the statement made to Annadhanam that he carried on his speculative business in shares in the name of the Union Agencies. One of the main factors urged in support of the contention that Dalmia was in the conspiracy is that the entire scheme of conspiracy was entered into for the sole benefit of Dalmia. It is not reasonably probable that such a conspiracy would come into existence without the knowledge or consent of Dalmia. The conspiracy charge framed against Dalmia mentioned the object of the conspiracy as 'meeting losses, suffered by you, R. Dalmia, in forward transactions, of speculation in shares, which transactions were carried on in the name of the Bharat Union Agencies Limited. ' and the charge under section 409 1. P. C. referred to the dishonest utilisation of the funds of the Insurance Company. This matter has been considered from several aspects. The first in that Dalmia is said to have owned the entire shares issued by the Union Agencies, or at least to have owned a substantial part of them and was in a position to control the other shareholders. To appreciate this aspect, it is necessary to give an account of the share holding in this company. The Union Agencies was incorporated at Bombay on April 1, 1948, as a private limited company, with its registered office at Bombay. It also had an office at 10, Daryaganj, Delhi, where the head office of the Bharat Insurance Company was. Its authorised capital was Rs. 5,00,000. The total number of shares issued in 1949 Was 2,000, Out of these 339 Dalmia held 1,200 shares, Dalmia Cement & Paper Marketing Company Ltd. (hereinafter called the Marketing Company) 600 shares, Shriyans Prasad Jain, brother of section P. Jain, 100 shares and Jagat Prasad Jain, the balance of 100 shares. The same position of share holding continued in 1950. In 1951, Dalmia continued to hold 1,200 shares, but the other 800 shares were hold by Govan Brothers. The position continued in 1952 as well and, in the first half of 1953, Dalmia increased the number of his shares to 1,800 and Govan Brothers increased theirs to 1,200 and the total shares issued thus stood at 3,000. This position continued up to September 21, 1954. On September 22, 1954, 2,000 shares were further issued to section N. Dudani, a nominee of Asia Udyog. The total shares on that date stood at 5,000 of which Dalmia held 1,800, Govan Brothers 1,200, and Dadani 2,000. On October 4, 1954, R.P. Gurha and J. section Mittal each got 100 shares from Govan Brothers with the result that thereafter the position of shareholding was: Dalmia 1,800; Govan Brothers 1000; Dudani 2,000; Gurba 10); and Mittal 100, out of the total number of issued shares of 5000. It is said that Dalmia transferred his 1,800 ,shares to one L. R. Sharma on October 30, 1954. Sharma 's holding 1,800 shares was mentioned in the return, Exhibit P. 3122 filed by the Union Agencies as regards share capital and shares as on December 31, 1955, in the office of the Register of Companies in January 1956 with respect to the year 1955. The return showed that the transfer had taken place on January 31, 1955. It would appear that the alleged sale of shares to Sharma in October 1954 was not mentioned in a similar return which must have been submitted to the Registrar of Companies in January, 1955, and that therefore its transfer was show on January 31, 1955, Probably 340 a date subsequent to the submission of the relevant return for the year 1954. A brief account of the various share holders may be given. Dalmia was a Director of Govan Brothers Ltd., and was succeeded, on his resignation, by O. P. Dhawan, who was an Accountant in the Delhi Office of the Union Agencies. He was also an employee of another company named Asia Udyog Ltd. Another Director of Govan Brothers Ltd. was D. A. Patil, lncome tax Adviser in the concerns of Dalmia. The share scrips in the Marketing Company standing in the name of Govan Brothers Ltd. and three blank share transfer forms signed by section N. Dudani as Secretary of Govan Brother Ltd., in the column entitled 'seller ' were recovered from Dalmia 's house on search on November 25, 1955. Dudani was the personal accountant of Dalmia and Manager of the Delhi Office of Bharat Union Agencies. The inference drawn by the Courts below from these circumstances is that Govan Brothers Ltd. was the concern of Dalmia, and this is reasonable. No Satisfactory explanation is given why the shares standing in the name of Govan Brothers Ltd. and the blank transfer forms should be found in Dalmia 's residence. Dudani was the personal accountant of Dalmia and Manager of the Delhi Office of the Union Agencies, and was also Secretary of Asia Udyog Ltd. Asia Udyog appears to be a sister concern of the Union Agencies. It was previously known as Dalmia Jain Aviation Ltd. It installed a telephone at one of Dalmia 's residences in January, 1953. Its offices were in the same room in which the offices of the Union Agencies were. Dhawan, who succeeded Dalmia as Director of Govan Brothers Ltd., was an employee of Asia Udyog. Gurha was the Accountant of Asia Udyog, in addition to being Director of the Union Agencies. He bad powers over the staff of both the companies. J, S, Mittal was Director of 341 Union Agencies and held 100 shares in the Union Agencies as nominee of Govan Brothers Ltd., from October 4, 1954, and 1,000 shares as nominee of Crosswords Ltd., from some time about January 31, 1955. L. N. Pathak, R. B. Jain and G. L. Dalmia, were authorised to operate on the account of both the Union Agencies, Calcutta, and Asia Udyog Ltd., with the United Bank of India, Calcutta. The issue and transfer of shares of the Union Agencies in September and October, 1954, seem to be in pursuance of an attempt to meet a contention, as at present urged for the State, that Dalmia was the largest shareholder in it. The same idea seemed to have led to the transfer of shares to Sharma by Dalmia. The verbal assertion of the sale having taken place in October, 1954, is not supported by the entry in Exhibit P. 3122 and what may be taken to be the entries in a similar return for the year 1954. This can go to support the allegation that Dalmia knew about the shady transactions which were in progress from early August, 1954. The learned Sessions Judge relied on the following circumstances for his conclusion that Dalmia was synonymous with Bharat Union Agencies. The speculation business of Dalmia Cement and Paper Marketing Co,. Ltd., the paid up capital of which nearly all belonged to Dalmia was on the liquidation of that company taken over by Bharat Union Agencies and more or less the same persons conducted the business of Bharat Union Agencies who were previously looking after Dalmia Cement & Paper Marketing Company. Bharat Union Agencies was known and taken to be the concern of Dalmia by its then Accountant Dhawan and by the brokers with whom it had dealings 342 3. Chokhani, who hold power of attorney on behalf of Dalmia and Bharat Union Agencies, told the brokers at the time he gave business of Bharat Union Agencies to them J. that it was the business of Dalmia. The salaries of personal and domestic employees of Dalmia were paid by Bharat Union Agencies and those payments were debited to the Salaries Account of the company. The personal employees of Dalmia were thus treated as the employees of Bharat Union Agencies. The business done in the name of Dalmia with Jagdish Jagmohan Kapadia was treated as the business of Bharat Union Agencies. The funds of Bharat Union Agencies were used to discharge an obligation personally undertaken by Dalmia. The price of the shares purchased in the process in the name of Dalmia was paid out of the funds of Bharat Unio n Agencies and the purchase of those shares was treated in the books of Bharat Union Agencies as part of its investment. When sister in law of Dalmia wanted money it was lent to her out of the funds of Bharat Union Agencies and in the books of that company no interest was charged from her". It has been strenuously urged by Mr. Dingle Foot that what certain persons considered to be the nature of the Union Agencies or what Chokhani told them could not be evidence against Dalmia with respect to the question whether he could be said to be identical with the Union Agencies. We need not consider this legal objection as it is not very necessary to rely on these considerations for 343 the purpose of the finding on this point. It may be said, however, that prima facie there seems to be no legal bar to the admissibility of statements that Chokhani told certain persons that Union Agencies was the business of Dalmia. He had authority to represent Dalmia and Union Agencies on the basis of the power of attorney held by him from both. His statement would thus appear to be the statement of their 'agent ' in the course of the business. We have considered the reasons given for the other findings by the learned Sessions Judge and accepted by the High Court and are of opinion that the findings are correct and that they can lead to no other conclusion than that no distinction existed between Dalmia and the Union Agencies and that whenever it suited Dalmia or the interests of the Union Agencies such transactions of one could be changed to those on behalf of the other. We may, however, refer to one matter. Dalmia admits having purchased shares of Dalmia Jain Airways of the face value of Rs.6,00,000/from Anis Haji Ali Mohammad, on behalf of the Union Agencies, in his own name, though the real purchaser was the Union Agencies and that he did so as the seller and his solicitor did not agree to sell the shares in the name of the latter. The explanation does not appear to be satisfactory. The seller had no interest in whose name the sale took place so long as he gets the money for the shares he was selling. Mr. Dingle Foot has urged that these various considerations may indicate strong association of Dalmia with the Union Agencies but are not sufficient to establish his complete identity with it, as is necessary to establish in view of the charges framed. Dalmia 's identity with Union Agencies or having great interest in it is really a matter providing motive for Dalmia 's going to the length of entering into a conspiracy to raise funds for Meeting the 344 losses of the Union Agencies by diverting the funds of the Insurance Company and which would amount to Committing criminal breach of trust. Dalmia admits having given instructions about the business of the Union Agencies in 1954 when he was not a Director of that company, and in 1955 when he was not even a shareholder. Dalmia 's own statement to Annadhanam on September 20, 1955, goes to support the conclusion in this respect. He stated to him then that he had lost the moneys in speculation which he did through his private companies and that most of those transactions were through the Union Agencies. Further, the charge said that he committed criminal breach of trust of the funds of the Insurance Company by wilfully suffering Chokhani to dishonestly misappropriate them and dishonestly use them or dispose of them in violation of the directions of law and the implied contract existing between Dalmia and the Insurance Company prescribing the mode in which such trust was to be discharged. It was in describing the manner of the alleged dishonest misappropriation or the use or disposal of the said funds in violation of the legal and contractual directions that the charge under section 409 I.P.C. described the Manner to consist of withdrawing the funds from the banks by cheques in favour of Bhagwati Trading Company and by the utilisation of those funds for meeting losses ' suffered by Dalmia in forward transactions in shares carried on in the name of Bharat Union Agencies, and for other purposes not connected with the affairs of the Insurance Company. Even in this description of the manner, the emphasis ought to be placed on the expression 'for meeting losses suffered by Dalmia in forward transactions in shares carried on in the name of the Bharat Union Agencies and for other purposes not connected with 345 the affairs of the said Bharat Insurance Company ' and not on the alleged losses suffered by Dalmia personally. We are therefore of opinion that firstly the evidence is adequate to establish that Dalmia and the Union Agencies can be said to be interchangeable and, secondly, that even if that is not possible to say, Dalmia had sufficient motive, on account of his intimate relations with the Union Agencies, for committing breach of trust, and thirdly, that the second finding does not in any way adversely affect the establishment of the offence under section 409 I. P. C. against Dalmia even though the charge described the utilisation of the money in a somewhat different manner. The entire scheme of the transactions must start at the instance of the person or persons who were likely to suffer in case the losses of the Union Agencies were not paid at the proper time. There is no doubt that in the first instance it would be the Union Agencies as a company which would suffer in its credit and its activities. We have found that Dalmia was so intimately connected with this com pany as could make him a sort of a sole proprietor of the company. He was to lose immensely in case the credit of the Union Agencies suffered, as it was commonly believed to be his concern and he bad connections and control over a number of business concerns and had a high stake in the business world. His prestige and credit were bound to suffer severely as a result of the Union Agencies losing credit in the market. There is evidence on record that if the losses are not promptly paid, the defaulter would suffer in credit and may not be able to persuade the brokers to enter into contracts with him. It is suggested for Dalmia that Chokbani had a greater interest in seeing that Union Agencies does not suffer in credit. We do not agree. If the Union Agencies failed on account of its losing credit in the market on its failure to meet the losses, Chokhani 346 may stand to lose his service with the Union Agencies. That would have meant the loss of a few hundred rupees a month. In fact, he need not have suffered any loss. He could have been employed by Dalmia who bad great confidence in him and whom he had been serving faithfully for a long time. Chokhani, as agent of Dalmia, had certainly credit in the market. There is evidence of his good reputation, but much of it must have been the result of his association with Dalmia and his concerns. He really enjoyed reflected glory. He bad no personal interest in the matter as Dalmia had. We therefore do not consider this suggestion to be sound and are of opinion that Dalmia was the only person who bad to devise means to meet the losses of the Union Agencies. Further, Dalmia admits that he used to give instructions with regard to the speculation in shares business of the Union Agencies at Calcutta and Delhi during 1954 and 1955, and stated, in answer to question No. 210 with respect to the evidence that Delhi Office of the Union Agencies used to supply funds for meeting the losses suffered by it in the speculation business at Calcutta and Delhi: " 'It is correct that as the result of shares speculation business at Calcutta and Delhi Bharat Union Agencies suffered losses in the final analysis. I was once told by R. P. Mittal on telephone from Calcutta that G.L. Chokhani had informed him that the Bombay Office would arrange for funds for the losses suffered by the Calcutta Office of the Bharat Union Agencies. It was within my knowledge that if the Bombay Office of the Bharat Union Agencies was not in a position to supply full funds for meeting the losses at Calcutta the Delhi Office of the Company would supply those funds." And, in answer to question No. 211 which referred 347 to the evidence about the Delhi Office of the Union Agencies being short of liquid funds from August, 1954, onwards and in 1955, to meet the losses, he said "It was within my knowledge that Bharat Union Agencies was holding very large number of shares. But I did not know the name of the Companies of which the shares were held by the Bharat Union Agencies and the quantum of those shares. " Dalmia also admitted his knowledge that Chokhani had entered into contract for the forward sale of Tata Shares at Bombay on behalf of the 'Union Agencies during 1954 and 1955 and that the Union Agencies suffered losses on this business, but stated that he did not know the extent or details of the losses. Dalmia must be expected not only to know the losses which the Union Agencies suffered, but also their extent. He is also expected to devise or at least know the ways in which those losses would be met. A mere vague knowledge, as stated, about the 'Union Agencies possessing a number of shares could not have been sufficient satisfaction about the losses being successfully met. It is to be noted that he did not deny that the Delhi Office was short of funds and that it used to supply funds to meet the losses. Further, if Dalmia 's statement about Mittal 's communication to him be correct, it would appear that when the Bombay Office of the Union Agencies was not in a position to meet the losses, Chokhani would not think of arranging, on his own, funds to meet the losses, but would first approach the Delhi Office of the Union Agencies. The Delhi Office., then, if unable to meet the losses, would necessarily obtain instructions from Dalmia. It can therefore be legitimately concluded that Dalmia alone, or in consultation with Chokhani, devised the scheme of 348 the transactions which led to the diversion of the funds. of the Insurance Company to the Union Agencies and carried it out with the help of the other appellants. It has been contended both for Chokhani and for Dalmia that funds could have been found to meet the losses of the Union Agencies by means other than the diversion of the Insurance Company 's funds. We need not discuss whether the shares held by the Union Agencies at the time could be sold to raise the funds or whether on the mere credit of Dalmia funds could be raised in no time. These courses were not adopted. The selling of the shares which the Union Agencies possessed, might itself affect its credit, and that no business concern desires, especially a concern dealing in sharespeculation business. Dalmia had been in telephonic communication with Chokhani. It is significant, even though there is no evidence about the content of the conversations, that there had been frequent calls, during the period of the losses in August and September, 1954, between Dalmia 's telephone and that of Chokhani at Bombay. That was the period when Dalmia was confronted with the position of arranging sufficient funds at Bombay for the purpose of diverting them to the Union Agencies. Very heavy losses were suffered in July and August, 1955. Securities of the face value of Rs. 79,00,000 and Rs. 60,00,000 were purchased in July and August, 1955, respectively. A very large number of telephone calls took place during that period between Dalmia at Delhi and Chokhani at Bombay. It is true that during certain periods of losses, the record of telephonic communications does not indicate that any telephonic communication took place. We have already stated, in considering the transactions, that the pattern of action to be taken had been fully determined by the course adopted in the first few transactions. 349 Chokhani acted according to that pattern. The only thing that he had to do in connection with further contingencies of demands for losses, was to send for securities from Delhi when the funds at Bombay were low. Such requests for the transfer of securities could be made in good time or by telephonic communication or even by letters addressed to Dalmia personally. The fact remains that a number of securities were sent from Delhi to Bombay under the directions of Dalmia when there was no apparent reason to send them other than the need to meet losses incurred or expected. Dalmia informed the Imperial Bank at Delhi about his power to deal with securities on September 4, 1954, though he had that power from September, 1951, itself. This was at the early stage of the commencement of the losses of the Union Agencies ,suffered for a period of over a year and the planned diversion of the funds of the Insurance Company to meet the losses of the Union Agencies. Raghunath Rai states that on the resignation of Chordia it was deemed necessary that the powers of the Chairman be registered with the Bank so that he be in a position to operate on the securities ' safecustody account of the company with the Bank, and that he sent the copy of the bye laws etc. , without the instructions of Dalmia, though with his knowledge, as he was told that it was necessary for the purpose of the withdrawal of the securities for which he had given instructions. This was, however, not necessary, as Raghunath Rai bad the authority to endorse, transfer, negotiate and or deal with Government securities, etc., standing in the name of the company. We are of opinion that Dalmia took this step to enable him to withdraw the securities from the Bank when urgently required and another person authorised to withdraw be not available or be not prepared to withdraw them on his own. 350 The position of the securities may be brifely described on the basis of Appendix 1 of the Investigator 's report Exhibit D. 74. The amount of securities at Bombay with the Chartered Bank, on June 30, 1953, was Rs. 53,25,000 out of a total worth Rs. 2,69,57,200. The amount of securities in the Bank continued to be the same till March 31, 1954, even though the total amount of securities rose to Rs. 3,04,88,600. Thereafter, there had been a depletion of securities with the Chartered Bank at Bombay with the result that on December 31, 1954, it had no securities in deposit. The amount of securities in the Imperial Bank of India, New Delhi, also fell subsequent to June 30, 1954. It came down to Rs. 2,60,000 on March 31, 1955, from Rs. 59,11,100 on June 30, 1954. Securities worth Rs. 52,00,000 were in the two offices on June 30, 1953. The amount of such securities kept on steadily increasing. It was Rs. 1,88,47,500 from September, 1953, to March 31, 1954. Thereafter, it rapidly increased every quarter, with the result that on March 31, 1955, the securities worth Rs. 3,76,50,804 out of the total worth Rs. 3,86,97,204 were in the offices. The overall position of the securities must have been known to Dalmia. The saving of Bank charges is no good explanation for keeping the securities of such a large amount, which formed a large percentage of the Company 's holdings, in the offices and not in deposit with a recognized bank. The explanation seems to be that most of the securities were not really in existence. Raghunath Rai states that be spoke to Dalmia a number of times, presumably, in July and August, 1955, about the non receipt of the securities of the value of Rs. 81,25,000, Rs. 75,00,000 and Rs. 69,00,000 which were purchased in the months of April May. July and August 1955 respectively, and Dalmia used 351 to tell him that as the purchase and sale of securities had to be effected at Bombay, Chokhani could send them to the head office only after it had been decided about which securities would be finally retained by the Insurance Company. This statement implies that Dalmia knew and anticipated the sale of those securities and such a sale of those securities, as already mentioned, could not be in the usual course of business of the company. The securities were to be sold only if by the next due date for payment of interest they could not be recouped and did not exist with the company. Such an inference is sufficient to impute Dalmia with the knowledge of the working of the scheme. Securities were sent to Bombay from Delhi seven times during the relevant period and they were of the face value of Rs. 2,114,82,500. Securities of the face value of Rs. 17,50,000 were withdrawn from the Imperial Bank, Delhi, on September 4, 1954 vide Exhibit P. 1351. They were sold at Bombay on September 9, 1954. Thereafter, 30/ 1957 securities of the face value of Rs. 37,75,000 were sent on January 6, 1955. Raghunath Rai deposes that he withdrew these from the Imperial Bank, Delhi, under the directions of Dalmia, and that he handed them over to Dalmia. These securites did reach Bombay. There is no clear evidence as to how they Went from Delhi to Bombay. They were sold on January 11, 1955. Eleven stock certificates of the face value of Rs. 57,72,000 were sent to Bombay on March 16, 1955, vide letter exhibit D. 3. Thereafter, stock Certificates were sent thrice in July 1955. Stock certificate in respect of 3% Bombay Loan of 1955, of the face ' value of Rs. 29,75,000 was sent to Bombay on July 15, 1955 vide Exhibit P. 923. On the next day, i.e., on July 16, 1955, stock certificates of 3% Bombay Loan of 1955 of the face value of Rs. 15,50,000 and stock 352 certificates of 3 % Loan of Government of Madhya Pradesh of the face value of Rs. 60,500 were sent to Bombay vide Exs. D. 1 and D. 2 respectively. J. Lastly, stock certificates of 2 3/4% Loan of 1962 of the face value of Rs. 56,00,000 were sent to Bombay on August 5, 1955. Letters Exhibits D. 3 and P. 892 state that the stock certificates mentioned therein were being sent under instructions of the Chairman '. Raghunath Rai has deposed that the other stock certificates send with letters Exhibits D. 1, D. 2 and P. 923, were sent by him as the securities with respect to which those certificates were granted were maturing in September and were redeemable at Bombay. It has been urged that they could have been redeemed at Delhi and that they need not have been sent by Raghunath Rai on his own a couple of months earlier. We do not consider the sending of the securities a month and a half or two months earlier than the date of maturity to be unjustified in the course of business. It is to be noticed that what was sent were the stock certificates and it might have been necessary to get the securities covered by those certificates for the purpose of redemption and that might have taken time. No pointed question was put to Raghunath Rai as to why he sent the securities two months ahead of the date of maturity. Dalmia denies that he gave any instructions for the sending of the securities. There seems to us to be no good reason why the expression under the instructions of the Chairman ' would be noted in letters Exhibits D. 3 and P. 892, unless that represented the true statement of fact. We have already discussed and expressed the opinion, in considering the evidence of Raghunath Rai, that Raghunath Rai was told by 353 Dalmia, when informed of the purchase or sale of securities, that had been done under instructions and that he had confirmed them. We may further state that there is no resolution of the Board of Directors empowering Chokbani to deal with the Rag securities. He was, however, empowered by resolutions at the meeting of the Board dated June 29, 1953, to lodge and receive G. P. Notes from the Reserve Bank of India for verification and endorsement on the same and to endorse or withdraw the G. P. Notes on behalf of the company in the capacity of an agent. Chokbani was also empowered by a resolution dated October 1, 1953, to deposit and withdraw Government securities held in safe custody account by the company. The aforesaid powers conferred on Chokhani are different from the powers of sale or purchase of securities. Dalmia has stated that he authorised Chokhani to purchase securities in about October, 1953,when he was to leave for abroad and that thereafter Chokhani had been purchasing and selling securities in the exercise of that authority without consulting him. It is urged for him that Raghunath Rai 's statement that be used to obtain confirmation of the purchase and sale of the securities from him cannot be true, as there was no necessity for such confirmation. Chokbani does not appear to have exercised any such authority during the period Dalmia was abroad or till August, 1954, and therefore Dalmia 's statement does not appear to be correct. Chokhani and Raghunath Rai were authorised to operate upon the Bank account at Bombay on October 1, 1953. Dalmia states, in paragraph 17 of the written statement dated March 30, 1959, that this was done as Chokhani bad been given 354 the authority for the sale and purchase of securities at the same time. The Board did not give any such authority to Chokhani and if the system of joint signatures was introduced for the reason alleged, there seems to be no good reason why the Board itself did not resolve that Chokhani be empowered to sell and purchase securities. The explanation for the introduction of joint signature scheme does not stand to reason. Even if it be not correct that Raghunath Rai had to obtain confirmation, it stands to reason that he should report such transactions on the part of Chokhani to the Chairman, if not necessarily for his approval, at least for his information, as Chokhani had no authority to purchase and sell securities. These transactions have to be confirmed by the Board of Directors and therefore confirmation of the Chairman who was the only person authorised to purchase and sell securities was natural. Raghunath Rai states that when he received no reply to his letter dated November 19, 1954, asking for distinctive numbers of securities not received at headquarters. Dalmia said that he would arrange for the dispatch of those secu rities from Bombay to the head office. No action was apparently taken in that connection. Raghunath Rai further states that on March 23, 1955, when he spoke to Dalmia about the non receipt of certain securities Dalmia told him that he had already instructed Chokhani for the conversion of those securities into stock certificates and that it was in view of this statement of Dalmia that he had written letter Exhibit P. 916 to Chokhani stating therein. "You were requested for conversion of the above said G. P. Notes into Stock Certificate. The said certificate As not been received by us 355 as yet. It may be sent now immediately as it is required for the inspection of the company 's auditors. " This indicates that Dalmia was in the know of the position of securities and, on his own, gave instructions to Chokhani to convert certain securities into inscribed stock. Dalmia admits Raghunath Rai 's speaking to him about the non receipt of the securities and his telling him that he would ask Chokhani to send them when he would happen to talk to him on the telephone. Mention has already been made of securities of the face value of Rs. 17,50,000 being sent to Bombay from Delhi in the first week of September 1954. At the time securities of the face value of Rs.53,25,000 were in deposit in the Chartered Bank at Bombay. There was thus no need for sending these securities from Delhi. Chokhani could have withdrawn the necessary securities from the Bank at Bombay. This indicates that on learning that there were no liquid funds for meeting the losses at Bombay, Dalmia himself decided to send these securities to Bombay for sale and for thus providing for the liquid funds there for meeting the cost of the intended fictitious purchase of securities to meet the losses of the Union Agencies. It is not suggested that these securities were sent to Bombay at the request of Chokhani. Securities withdrawn in January, 1955, and stock certificates sent in March and August, 1955, coincided with the period when the Union Agencies suffered losses and the funds of the Insurance Company at Bombay were low and were insufficient to meet the losses of the Union Agencies. 3% 1957 securities of the face value of Rs. 46,00,000 (Rs. 37,75,000 set from Delhi and 356 Rs. 8,25,000 withdrawn from the Chartered Bank at Bombay) were sold on January 11, 1955, and the proceeds were utilised in purchasing 2 3/4% 1962 securities of the face value of Rs. 46,00,000 in two lots, one of Rs. 35,00,000 and the other of Rs. 11,00,000. On January 11, 1955, Rs. 3,34,039 15 3, the balance of the sale proceeds was deposited in the accounts of the Insurance Company. Inscribed stock for these securities worth Rs. '46,00,000 was duly obtained. Dalmia himself handed over inscribed stock certificate to Raghunath Rai some time in the end of January 1955. This purchase, though genuine, was not a purchase in the ordinary course of business, but was for the purpose of procuring the inscribed stock certificate to satisfy the auditors, as already discussed earlier, that similar securities purchased in December, 1954 existed. The auditors were than to audit accounts of 1954 and not of 1955. In this connection reference may be made to Dalmia 's attitude to the auditors ' surprise inspection on September 9, 1954, on the ground that they could not ask for inspection of securities purchased in 1955. It may also be mentioned that purchasing and selling securities was not really the business of the Insurance Company. The Insurance Company had to invest its money and, under the statutory requirements, had to invest a certain portion at least in Government Securities. The value of Government securities does not fluctuate much. Dalmia states, in answer to question No. 25 (under a. 342 Cr. P. C.): 'Government securities are gift edged securities and there is very small fluctuation in these. ' The question of purchasing and selling of securities with a view to profit could not therefore be the ordinary business of the Insurance 357 Company. It has to purchase securities when the statutory requirements make it necessary, or when it has got funds which could be invested. The Insurance Company had Government of India 3% Loan of 1957 in deposit with the Chartered Bank, Bombay, the face value of the securities being Rs. 53,25,000, from April 6, 1951, onward. The fact that these securities remained intact for a period of over three years, bears out our view that the purchasing and selling of securities was not the normal business of the Insurance Company, Securities are purchased for investment and are redeemed on the date of maturity. In this connection, reference may be made to Khanna 's statement in answer to question in cross examination The frequency of transactions relating to purchase and sale of securities depends upon the share market and its trends ? His answer was that was so, but that it also depended on the character of the company making the investment in securities. It may be said that the trend of the share market will only guide the purchase or sale transactions of securities of a company speculating in shares, like the Union Agencies, but will not affect the purchase and sale by a company whose business is not speculation of shares like the Insurance Company. Raghunath Rai states that when on September 9, 1955, the auditors wanted the production of the securities, said to be at Bombay, in the next two days, he informed Dalmia about it and Dalmia said that he would arrange for their production after two days. Dalmia, however, took no steps to contact Chokhani at Bombay, but rang up Khanna instead and asked him to certify the accounts as they had to be laid before the Company by September 30, and told him that everything was in order,. that he would give all satisfaction later, 358 soon after Chokhani was available and that he did not ask for an extension of time for the filing of the accounts as that would affect the prestige of the company. On September 10, 1955, when Raghunath Rai handed over the letter Exhibit P. 2 of even date from the auditors asking him to produce a statement of investments as on September 9, 1955, along with the securities or evidence if they were with other persons, by Tuesday, September 13, Dalmia had stated that Chokbani 's mother had died and that he would himself arrange for the inspection of securities direct with the auditors. Chokhani 's mother died on September 4, 1955. Dalmia had no reason to tell Raghunath Rai on September 9 that the securities would be produced for inspection in the next two days, unless he believed that he could get them in that time on contacting Chokhani, or did not wish to tell him the real position. Dalmia states that he contacted Chokhani for the first time on September 15, the last day of the mourning and then learnt from Chokhani that the securities were not in existence, the money withdrawn for their purchase having been lent to the Union Agencies. The various statements made by Dalmia in these circumstances and his conduct go to show that he had a guilty mind and when he made the statement to Raghunatb Rai that the securities would be produced within two days, he trusted that he would be persuasive enough for the auditors to pass the accounts without further insistence on the production of those securities. Dalmia 's not going to Mr. Kaul 's Office on September 16, and sending his relations to inform the latter of the shortfall in securities can have no other explanation than that he was guilty and therefore did not desire to have any direct talk about the matter with Mr. Kaul. There was no need to avoid meeting him and miss the opportunity 359 of explaining fully what Chokhani had done without his own knowledge. Dalmia has admitted that he sent his relations to Mr. Kaul and has also admitted that what they) stated to Mr. Kaul was under his instructions. , He states in answer to question No. 450, that after the telephonic talk with Chokhani on the evening, of September 15, he consulted his brother Jai Dayal Dalmia and his son in law section P. Jain about the position and about the action to be taken and that it was decided between them before they left for the office of Mr. Kaul that they would tell him that either the securities would be restored or their price would be paid off as would be desired by the Government and in answer to question No. 451, said that it was correct that these persons told Mr. Kaul that a considerable amount of the securities were missing and that they were to make good the loss. It is clear that these persons decided not to disclose to Mr. Kaul that the securities were not in stock because they were not actually purchased and the amount shown to be spent on them was lent to the Union Agencies. was not a case of the securities missing but a case of the Insurance Company not getting those securities at all. It is a reasonable inference from this conduct of Dalmia that he did not go himself to Mr. Kaul as he was guilty and would have found it inconvenient to explain to him how the shortfall had taken place. We may now discuss the evidence relating to Dalmia 's making a confession to Annadhanam. Annadhanam was a Chartered Accountant and partner of the Firm of Chartered Accountants M/s. Khanna and Annadhanam, New Delhi, and he was appointed by the Central Government, in exercise of its powers under section 33(1) of the , on September 19, 1955, to investigate into the affairs of the Bharat Insurance 360 company and to report to the Government on such investigation. He started this work on September 20. Annadhanam, having learnt from Raghunath Rai about the missing of a number of Government securities and the amount of their value from the statement prepared by him, called Dalmia to his office that evening in order to make a statement. Dalmia made the statements Exhibits P. 10 and P. reads : " 'I have misappropriated securities of the order of Rs. 2,20,00,000 of the Bharat Insurance Company Ltd. I have lost this money in speculation. " Exhibit P. 11 reads: "Further stated on solemn affirmation. At any cost, I want to pay full amount by requesting my relatives or myself in the interest of the policy holders. " Dalmia admits having made the statement Exhibit P. 11. but made some inconsistent statements about his making the statement Exhibit P. 'LO. It is said that he never made that statement, but in certain circumstances he asked the Investigator to write what he considered proper and that he signed what Annadhanam recorded. He did not directly state, but it was suggested in cross examination of Annadhanam and in his written statement that he made that statement as a result of inducement and promise held out by either Annadhanam of Khanna (the other partner of M/s. Khanna and Annadhanam, Chartered Accountants, New Delhi) or both. Dalmia 's contention that Exhibit P. 10 was inadmissible in evidence, it being not voluntary, was repelled by the learned Sessions Judge, but was, in a way, accepted by the High Court which did not consider it safe to rely on it. The learned Solicitor General urged that the confession Exhibit P. 10 was 361 voluntary and was wrongly not taken into consideration by the High Court. Mr. Dingle Foot contended that the High Court took the proper view and the confession was not voluntary. He further urged that the confession was bit by the provisions of el. (3) of article 20 of the Constitution. The only witnesses with respect to the recording of the statement Exhibit P. 10. are Annadhanam and Khanna. The third person who knew about it and has stated about it is Dalmia himself. He has given his version both in his statement recorded under section 342 Cr. P. C. and in his written statement filed on October 24, 1958. We may first note the relevant statement in this connection before discussing the question whether the alleged confession is voluntary and therefore admissible in evidence. Annadhanam made the following relevant statements: Dalmia came to the office at 6.30 p.m. though the appointment was for 5.30 p.m. His companion stayed outside the office room. Annadhanam asked Dalmia the explanation with regard to the missing securities. Dalmia wanted two hours ' time to give the explanation. This was refused. He then asked for half an hour 's time at least. This was allowed. Dalmia went out of the office, but returned within ten minutes and said that he would make the statement and it be record. Annadhanam, in the exercise of the powers under section 33(3) of the , administered oath to Dalmia and recorded the statement Exhibit P. 10. It was read over to Dalmia. Dalmia admitted it to be correct and signed it. Shortly ' after, Dalmia stated that he wanted to add one more sentence to his statement. He was again administered oath and his further statement, Exhibit P. 11 was recorded. This was also read over and Dalmia signed it, admitting its accuracy. 362 Annadhanam states that no threat or inducement or promise was offered to Dalmia before he made these statements. A third statement is also attributed to Dalmia and it is that when Dalmia was going away and was nearing the stair case, Annadhanam asked him whether the speculation in which he had lost the money was carried on by him in the company 's account or in his private account. Dalmia replied that he had lost that money in his personal speculation business which was carried on chiefly through one of his private companies, viz., the Union Agencies. This statement was not recorded in writing. Annadhanam did not consider it necessary, but this was mentioned by Annadhanam in his supplementary interim report, Exhibit P. 13, which he submitted to the Deputy Secretary, Ministry of Finance, on September 21, 1955. Annadhanan also mentioned about the statement recorded in Exhibit P. 10 in his interim report, Exhibit P. 12, dated September 21, 1955, to the Deputy Secretary, Ministry of Finance. In cross examination, Annadhanam stated that he did not send for Dalmia to the office of the Bharat Insurance Company where he had examined Raghunath Rai, as he had not made up his mind with respect to the further action to be taken. He denied that he had any telephonic talk with Mr. Kaul, the Deputy Secretary, Ministry of Finance, prior to the recording of the statements, Exhibits P. 10 and P. II His explanation for keeping Khanna with him during the examination of Dalmia was that Khanna had done the detailed auditing of the accounts of the company in pursuance of the firm Khanna and Annadhanam being appointed auditors for 1954 by the Insurance Company. He denied that Dalmia told him that he had no personal knowledge ' of the securities and that the only information he had from Chokhani was that the 363 latter had given money on loan to the Union Agencies. He stated that the statements Exhibits P. 10 and 11 were recorded in the very words of Dalmia. The statements were not actually read over to Dalmia but Dalmia himself read them over. Annadhanam denied that he told Dalmia that he would not be prosecuted if he made the statements Exhibit P. 10 and P. 11 and deposited. the money alleged to have been embezzled and further stated that Khanna did not tell this to Dalmia. He denied that Exhibit P. 10 was never made by Dalmia and was false and reiterated that statement was made by Dalmia. He did not consider it proper to reduce to writing every word of what transpired between him and Dalmia from the moment of the latter 's arrival in his office till the time of his departure, and considered it proper ' to reduce in writing the statement which was made with regard to the missing securities. He further stated that his statement above Dalmia 's making statements Exhibits P. 10 and P. 11 voluntarily was on account of the facts that Dalmia himself volunteered to make those statements and that he himself had offered no inducements or promises. In cross examination by Mr. T. C. Mathur, he denied that he told Dalmia that as Chairman of the Insurance Company he should own responsibility for the missing securities and that would make him a greater Dalmia because he was prepared to pay for the short fall and further denied that it was on account of the suggested statement that Dalmia had asked for two hours ' time before making his statement. In cross examination by Dalmia personally, Annadhanam explained the discrepancy in the amount of the securities admitted to be misappropriated. Exhibit P. 10, mentions the securities to be of the order of Rs. 2,20,00,000/. In his report 364 Exhibit P. 12, he stated the admission to be with respect to securities of the face value of Rs. 2,22,22,000/ . The explanation is that in the interim report he worked out the face value of the missing securities to be Rs, 2,22,22,000/ , and he mentioned this figure in his report as Dalmia had admitted the misappropriation of the securities. Nothing sinister can be inferred from this variation. Khanna practically supports the statement of Annadhanam, not only with respect to Exhibit P. 10 and P. II, but also with respect to the third statement said to have been made near the staircase. His statements in cross examination that it was possible that Annadhanam might have asked the companion of Dalmia to stay outside the office as the proceedings were of a confidential nature, does not in any way belie Annadhanam 's statement as this statement itself is not definite. In answer to the question whether it struck him rather improper that Dalmia made the statement Exhibit P. 10 in view of his previous statement to Khanna that satisfaction would be afforded to the auditors on the points raised by them after Chokhani was available, he replied that his own feeling was that the statements Exhibits P. 10 and P. 11 were the natural culmination of what he learnt in the office of Mr. Kaul on September 16, 1955. He also denied that be told Dalmia that whoever was at fault, the ultimate responsibility would fall on the Chairman and other Directors as well as the officers of the Insurance Company by way of misfeasance, and that Dalmia should sign the statement which would be prepared by himself and Annadbanam so that the other Directors and the officers of the Insurance Company be not harassed and that if this sugges tion was accepted by Dalmia, he would save every one and become a greater Dalmia. He denied the suggestion that when Dalmia talked of his charitable disposition in his office on September 20, 1955, it should have been in answer to his (Khanna 's) 365 provocative remarks wherein he had made insinuations regarding Dalmia 's integrity and stated that he was merely a silent spectator of what actually Del: had happened in the office that day. He further stated that no question arose of Annadhanam 's attacking the integrity of Dalmia on September 20, 1955. He denied that Mr. Kaul had told him or Annadbanam on September 19, when the order appointing Annadhanam Investigator was delivered, that Dalmia had to be implicated in a criminal case. Khanna denied that his tone and remarks during the discussion were very persuasive and that told Dalmia that it was very great of him that he was going to pay the amount represented by the short fall of the securities. He also denied the suggestion that Dalmia told him and Annadhanam on September 20, at their office, that be had no knowledge of the missing securities, that it, appeared that the securities had either been sold or pledged and that the money had been paid to the Union Agencies, which Dalmia did not , like, and that in the interest of the policy holders and the Insurance Company Dalmia was prepared to pay the amount of the short fall of securities, and also that when Dalmia spoke about the securities being sold or pledged. Khanna and Annadhanam remarked that the securities bad been misappropriated. He denied that he told Dalmia that if he took personal responsibility in the matter, it would be only then that no action would be taken and stated that he and Annadhanam were nobody to give any assurance to Dalmia. Dalmia stated, in this statement under section 342 Cr. P.C. on November 7, 1958, that his companion Raghunath Das Dalmia stayed out because he was not allowed to stay with him inside the office. He denied that he first spoke about his charitable disposition and piety when asked by Annadhanam to explain about the missing securities and stated that 366 there could be no occasion for him to talk at that time of his piety and charitable disposition when he had been specifically called to explain with regard to the missing securities. His version of what took place may now be quoted (answer to question No. 471) in his own words: "What actually happened was that I told Shri Annadhanam that I had learnt from G. L. Chokhani that the amount of the missing securities had been lent temporarily on behalf of the Bharat Insurance Company by Shri G. L. Chokhani to Bharat Union Agencies and that the amount had been lost in speculation. Shri Annadhanam then asked me about the missing securities. I then told him that I did not know as to whether the securities had been sold or mortgaged. My replies here being noted by Shri Annadhanam on a piece of paper. Shri Annadhanam then asked me as to when the securities had been sold or mortgaged I replied that I did not know with regard to the time when the securities had been sold or mortgaged. Shri Annadhanam then asked me as to what were the places where there were offices of Bharat Union Agencies. I then told him that the offices were at Bombay and Delhi. I than remarked that whatever had happened, I wanted to pay the amount of the missing securities as the interest of the policy holders of the Bharat Insurance Company were close to my heart. During the course of that talk sometimes Shri Annadhanam questioned and sometimes the questions were asked by Shri Khanna. Shri Khanna then stated that I should forget the events of 9 9 1955. Shri Khanna further stated. 'We too are men of hearts. And not bereft of all feelings. We too have children. I am very much impressed by your offer of such a huge 367 amount '. Shri Khanna also remarked that Shri Annadhanam had been appointed under section 33 of the to investigate into the affairs of the Bharat Insurance Company and as such the words of Shri Khanna and Shri Annadhanam would carry weight with the Government. Shri Khanna also stated other things but I do not remember them. I however distinctly remember that Shri Khanna stated to me that I should go to Shri C. D. Deshmukb and that Shri Khanna would also help me. I then replied that I would not like to go to Shri Deshmukh. Shri Khanna then remarked that the Government attached great importance to the interests of the policy holders and that if the matter got undue publicity it would cause a great loss to the policy holders. Shri Khanna accordingly stated that if I agreed to his suggestion the matter would be settled satisfactorily and without any publicity. It was in those circumstances that I asked for two hours ' time to consult my brother and son in law." He further stated that when Annadhanam told him that he could have half an hour 's time and that more time could not be given as the report had to be given to the Government immediately, he objected to the shortness of time as he could not during that interval go to meet his brother and son in law and return to the office after consulting them and further told Annadhanam and Khanna to write whatever they considered proper as he had trust in them. His reply to question No. 476 is significant and reads: "The statement was read over tome. I then pointed out that what I had stated had not been incorporated in exhibit P. 10. I made 368 no mention that the statement exhibit ' P. 10 was correct or not. Shri Annadhanam then reduced to writing, whatever was stated by me. That writing if exhibit P. 11 and is in the very words used by me. " He does not directly answer question No. 479: "It is in evidence that the statement exhibit P. 1 1 was read over to you, you admitted it to be correct and signed it. Do you want to say anything with regard to that?" and simply stated, 'I did sign that statement '. He denied the third statement alleged to have been made near the staircase. Dalmia also stated that he had mentioned some facts about the statements Exhibits P. 10 and 11 in his written statement. Paragraphs 53 to 59 of the written statement dated October, 24, 1958, refer to the circumstances about the making of the statements Exhibits P. 10. and P. II. In paragraph 53 Dalmia states that the recording of his statement in Annadhanam 's office took place as it was only there that Annadhanam and Khanna could get the necessary privacy. The insinuation is that they did not want any independent person to know of what transpired between them. Paragraph 54 refers to a very minor discrepancy. Paragraph 55 really gives the version of what took place in, Annadhanam 's office. We refer only to such portions of this version as do not find a place either in the suggestions made to Annadhanam and Khanna in their cross examination or in the statement of Dalmia under a. 342 or which be inconsistent with either of them. Dalmia stated that he told Annadbanam that the 369 money that had been received by Bharat Union Agencies as loan belonged to Bharat Insurance Company and it appeared that the Union Agencies had lost that money in speculation. He further which tend to impute an inducement on the part of Khanna to him. These statements may be quoted in Dalmia 's own words: "On this Shri Khanna said that I was a gentleman, that I was prepared to pay such a heavy amount which has never been paid so far by anybody, that I should accept his advice and that I should act according to his suggestion and not involve myself in this dis pute, the Government was not such a fool that they would not arrive at a quiet settlement with a man who thought that his first duty was to protect the policy holders and thus by spoiling the credit of the Bharat Insurance Co. would harm its policy holders. If the Government did so it would be an act of cruelty to the policy holders, and when I was prepared to pay the money it (Government) would not take any such course by which I may have to face troubles, that my name would go very high, that he advised me as being my well wisher that I should confess that I had taken the securities, that they would help me. They added that Shri Annadhanam has been appointed as Investigator by the Government and therefore their words carry weight with the Government, that it was my responsibility, being the Chairman and Principal Officer of the Bharat Insurance to pay the money. At that time I was restless to pay the money. I was influenced by their talk and anybody in my place would have trusted their words. I was impressed by their saying to me that Po wise Government or officers would take 370 such action which would harm the policyholders through publicity. Therefore I took that whatever Shri Khanna and Annadhanam were saying was for my good". He stated that he asked Annadhanam and Khanna for two hours ' time to consult his brother. and son in law and that one of them said that they could not give more than half an hour, This is inconsistent with what he stated under section 342. He further stated : "I told them to write in whatever way they thought best and whatever they wrote I simply signed. After signing when I read it, I pointed out to them that they had not written that I wanted to pay every pie of the policy holders and then they wrote as I told them and I signed". The statement referred to is a short one, and it is not possible to believe that he signed it without reading it. Paragraph 56 makes no reference to the events of that evening, but paragraph 57 refers to the improbability of his writing things which brought trouble to him when just before it he had been talking irrelevantly. The question in cross examination did suggest that he was forced to make irrelevant talk due to certain provocation. That does not fit in with the explanation in paragraph 57 that his talk about a temple was invented to support the statement Annadhanam had made to the police about Dalmia 's talking irrelevantly. His statement 'How could I have acted in such a way without any positive assurances, implies that he did make the statements though on getting assurances. In para graph 58 he states : "On 20th September Shri Khanna and Annadhanam had put all sorts of questions 371 to Raghunath Rai but let me off after recording my statement in just one or two lines. Their design had succeeded and therefore they, did not care to record any further question". This again implies his making the statement P. 10. Of course, after he had made the statement P. 10 there was no necessity of asking anything further. His statement explained the missing of the securities. Reference may now be made to what Raghunath Rai, who was the Secretary of the Bharat Insurance Company, states in reference to the statement made by Dalmia to Annadhanam. Raghunath Rai states that when he went to Dalmia about 7 p. m. on September 200, 1955, and told him about the recording of his own statement by Annadhanam and the preparation of the statement about Exhibit P. 8 and about his talk regarding the securities at Bombay, Dalmia said : 'I have been myself in the office of the Investigator. He has recorded my statement wherein I have admitted the short fall of the securities '. This also points to Dalmia 's making the statement Exhibit P. 10. Raghunatb Rai did not admit, but simply said that Dalmia did tell him something when he was questioned as to whether Dalmia told him that he had been told by Anadbanam and Khanna that if he had made the statement in accordance with their desire, there would be no trouble. Dalmia evaded a direct answer to the question put to him under section 342, Cr. P. C. When question No. 482 was put to him with reference to this statement of Raghunath Rai he simply stated that he had briefly told Raghunath Rai with regard to what bad transpired between him and Khanna and Annadhanam and that he had told Raghhunath Rai that he need not worry. 372 The various statements of Dalmia suggesting that inducement was; held out to him by Khanna have not been believed by the Courts below, and we see no good reason to differ from their view. There was no reason for Annadhanam to record an incriminating statement like P. 10 and get it signed by Dalmia. The High Court does not also hold that the confession was the result of some threat extended by Annadhanam. It did not consider it safe to rely upon it as it considered the confession to be not voluntary in a certain sense. It said : "In that sense, therefore, it was not a voluntary statement, because although no words of threat or inducement were uttered by Mr. Annadhanam or anyone else, the circumstances had shaped themselves in such a manner that there was an implied offer of amnesty being granted to him if he did not persist in his negative behavior. He therefore made a statement that he had misappropriated the securities and immediately offered to make good the loss through his relatives". What are those circumstances which implied an offer of amnesty being granted to him if he did not persist in his negative behaviour, presumably in not giving out full information about the missing securities ? Such circumstances, as can be gathered from the judgment of tile High Court seem to be these : (1) Dalmia, a person of considerable courage in commercial affairs was Dot expected to make a voluntary confession. (2) He had evaded meeting the issue lull face whenever he could do so and did not appear before Mr. Kaul on September 16, 1955, to communicate to him the position about the securities. (3) He not only appeared before Annadbanam an hour late, but further asked for two hours ' time before answering a simple question about the missing securities. (4) He made the 373 statement when he felt cornered on account of the knowledge that Annadhanam had the authority of law to question and thought that, the only manner of postponing the evil consequence of his act was by making the statement which would soften the attitude of the authorities towards him. We are of opinion that none of these circumstances would make the confession invalid. Dalmia 'a knowledge that Annadhanam could record his statement under law and his desire to soften the attitude of the authorities by making the statement do not establish that he was coerced or compelled to make the statement. A person of the position, grit and intelligence of Dalmia could not be so coerced. A person making a confession may be guided by any considerations which, according to him, would benefit him. Dalmia must have made the statement after weighing the consequences which he thought would be beneficial to him. His making the confession with a view to benefit himself would not make the confession not voluntary. A confession will not be voluntary only when it is made under some threat or inducement or promise, from a person in authority. Nothing of the kind happened in this case and the considerations mentioned in the High Court 's judgment do not justify holding the confession to be not voluntary. We are therefore of opinion that Dalmia made the confession Exhibit P. 10, voluntarily. It was argued in the High Court, for the State, that Dalmia thought it best to make the statement because, by doing so, he hoped to avoid the discovery of his entire scheme of conspiracy which had made it possible for him to misappropriate such a large amount of the assets of the Insurance Company. The High Court held that even if the confession was made for that purpose, it would not be a voluntary confession. We consider this ground to hold the confession involuntary unsound, 374 Mr. Dingle Foot has contended that the statement, Exhibit P. 10, is not correct, that Annadhanam and Mr. Kaul colluded and wanted to get a confession from Dalmia and that is why Annadhanam extracted the confession and that various circumstances would show that the confession was not voluntary in the sense that it was induced or obtained by threat. He has also urged that Annadhanam was 'a person in authority ' for the purpose of section 24 of the Indian Evidence Act. These circumstances, according to him, are that Dalmia 's companion was not allowed to stay in the office, that only balf an hour was allowed for Dalmia to make consultations, that there had been a discussion before the recording of Exhibit P. 10, that no record on the discussion was maintained, that Annadhanam, as Investigator, was a public servant, that section 176, 1. P. C. was applicable to Dalmia if he had not made the statement and that the statement on oath really amounted to an inquisition. It was further contended that if the confession was not inadmissible under section 24 of the Evidence Act; it was inadmissible in view of cl. (3) of article 20 of the Constitution. Mr. Dingle Foot has further contended That the statement, exhibit P. 10, is not correct inasmuch as it records: 11 have misappropriated securities of the order of rupees two crones, twenty lakhs of the Bharat Insurance Company Ltd. ', that it could not be the language of Dalmia and that these facts supported Dalmia 's contention that be simply signed what Annadhanam had written. The public prosecutor had also questioned the correctness of this statement inasmuch as the actual misappropriation was done by Chokhani and Dalmia had merely suffered it and as the accurate statement would have been that there was mis appropriation of the money equivalent of the Securities. 375 We are of opinion that any vagueness in the expression could have been deliberate. The expression used was not such that Dalmia, even if he had a poor knowledge of English, could not have used. The statement was undoubtedly very brief. It cannot be expected that every word was used in that statement in the strict legal sense. The expression 1 misappropriated the securities ' can only mean that he misappropriated the amount which had been either spent on the purchase of the securities which were not in existence, or realised by the sale of securities, and which was shown to be utilised in the fictitious purchase of securities. The main fact is that Dalmia did admit his personal part in the loss of the amount due to the shortfall in the securities. There is nothing on record to justify any conclusion that Annadhanam and Mr. Kaul bad colluded and wanted to get a confession from Dalmia. It is suggested that Annadhanam war, annoyed with Dalmia on account of the latter 's resentment at the conduct of Annadhanam and Khanna in conducting a surprise inspection of the accounts and securities on September 9, 1955. Raghunath Rai protested saying that they had already verified the securities and that they, as auditors for the year 1954, had no right to ask for the inspection of securities in the year 1955. At their insistence, Raghunath Rai showed the securities. After their return to the office, Dalmia rang them up and complained that they were unnecessarily harassing the officers of the Bharat Insurance Company and had no right to inspect the securities. Dalmia was not satisfied with their assertion of their right to make a surprise inspection. There was nothing in this conduct of Dalmia, which should have annoyed Annadbanam or Khanna. They did 376 what they considered to be their duty and,., successfully met the opposition of Raghunath Rai. If there could be any grievance on account of their inspection, it would be to Dalmia who, as a result, would not be easily induced by them to make the confession. Mr. Kaul, as Deputy Secretary, Ministry of Finance, did take part in the bringing of the matter to a bead, not on account of any personal animus against Dalmia such animus is not even alleged but on account of his official duties, when be heard a rumour in Bombay that Dalmia had incurred heavy losses amounting to over two crores of rupees through his speculative activities and had been drawing upon the funds of the Insurance Company of which he was the Chairman to cover his losses. He asked Dalmia on September 14, 1955, to see him on the 15th in connection with the securities of the Insurance Company. When Dalmia met him on the 15th in the presence of Mr. Barve, Joint Secretary, he asked whether he had brought with him an account of the securities of the Bharat Insurance Company. Dalmia expressed his inability to do so for want of sufficient time and promised to bring the account on September 16. On the 16th, Dalmia did not go to Mr. Kaul 's office; instead, his relations section P. Jain and others met Mr. Kaul and made certain statements. Mr. Kaul submitted a note, exhibit D. 67, to the Finance Minister or September 18, 1955, and in his note suggested that of all the courses of action open to the Government, the one to be taken should be to proceed in the matter in the legal manner and launch a prosecution as the acceptance of section P. Jain 's offer would amount to compounding with a criminal offender. Mr. Kaul stated that he did not consider it necessary to make any enquiry because the merits of the case against Dalmia remained unaffected whether the loss was rupees two crores or a few lakhs, more or less, On the basis of the aforesaid suggestion of 377 Mr. Kaul and his using the expression 'courses against Shri Dalmia it is urged that criminal action was contemplated against Dalmia and that there must have been some understanding between Mr. Kaul and Annadhanam about securing some sort of confession from Dalmia for the purpose of the case which was contemplated. We consider this suggestion farfetched and not worthily of acceptance. As a part of his duty, Mr. Kaul had to consider the various courses of action open to the Government in connection with the alleged drawing upon the funds of the Insurance Company to cover his losses in the speculative activities. Mr. Kaul did not know what bad actually transpired with respect to the securities. He had heard something in Bombay and then he was told about the short fall in the securities of the Bharat Insurance Company and. naturally. , he could co template that the alleged conduct could amount to a criminal offence. In fact, ,according to Mr. Kaul, a suggestion had been made to him by section P. Jain that on the making up of the short fall in securities no further action be taken which might affect the position of Dalmia and his other associates in business and of various businesses run by them. The fact that Annadhanam knew that there had been a short fall of over rupees two crores prior to Dalmia 's making the statement Exhibit P. 10 cannot justify the conclusion that Annadhanam and Mr. Kaul were in collusion. Annadhanam does not admit he had ordered Dalmia 's companion to stay out of the office. Even if he did, as stated by Dalmia, that would not mean that Annadhanam did it on purpose, the purpose being that he would act unfairly towards Dalmia and that there be not any witness of such an attempt. Similarly, the non maintenance of the record of what conversation took place between Dalmia and the Investigator, does not point out to any sinister purpose on the part of Annadhanam. It was 378 Annadhanam 's discretion to examine a person in connection with the affairs of the insurance Company. He put simple question to Dalmia and that required him to explain about the missing securities. So long as Dalmia did not make a statement in that connection, it was not necessary to make any record of the talk which might take place between the two. In fact, Annadhanam had stated that the word discussion used by him in his supplementary interim report Exhibit P. 13, really be read as "recording of the statement of Shri Dalmia and the talk he had with when he came to Annadhanam 's office and which he had with him while going to the staircase '. This explanation seems to fit in with the context in which the word discussion ' is used in Exhibit P. 13. The interval of time allowed to Dalmia for consulting his relations might have been considered to be insufficient considering for confession voluntary in case that was the time allowed to a confessing accused produced before a Magistrate for recording a confession. But that was not the position in the present case. Annadhanam was not going to record the confession of Dalmia. He was just to examine him in connection with the affairs of the Insurance Company and had simply to tell him that he had called him to explain about the missing securities. There was therefore no question of Annadhanam allowing any time to Dalmia for pondering over the pros and cons of his making a statement about whose nature and effect he would have had no idea. We do not therefore consider that this fact that Dalmia was allowed half an hour to consult his relations can point to compelling Dalmia to make the statement. We do not see that examination of Dalmia on oath be considered to be an inquisition. Sub section (3) of section 33 of the empowers the Investigator to examine on oath any manager, managing director or other officer of the insures in relation to his business. , Section 176 of the Indian 379 Penal Code has no application to the examination of Dalmia under section 33 of the . Section 176 reads: "Whoever, being legally bound to give any notice or to furnish information on any subject to any public servant, as such, inten tionally omits to give such notice or to furnish such information in the manner and at the time required by law, shall be punished with simple imprisonment for a term which may extend to one month, or with fine which may extend to five hundred rupees, or with both. or, if the notice or information required to be given respects the commission of an offence or is required for the purpose of preventing the commission of an offence, or in order to the apprehension of an offender, 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; or, if the notice or information required to be given is required by an order passed under sub section (1) of section 56.5 of the Code of Criminal Procedure, 1898, with imprisonment of either description for a term which may extend to six months, or with fine which may extend to one thousand rupees. or with both. " For the application of this section, it is necessary that Annadhanam, as Investigator, be a public servant. Annadhanam cannot be said to be a servant. He was not an employee of Government. He was a Chartered Accountant and had been directed by the order of the Central Government to investigate into the affairs of the Insurance Company and to report to the Government on the investigation made by him. of course, he was to get 380 some remuneration for the work he was entrusted with. 'Public servant ' is defined in section 21 of Indian Penal Code. Mr. Dingle Foot has argued that Annadhanam was a public servant in view of the ninth clause of section 21. According to this clause, every officer in the service or pay of the Government or remunerated by fees or commission for the purpose of any public duty would be a public servant. A person who is directed to investigate into the affairs of an Insurance Company under section 33(1) of the , does not ipso facto become an officer. There is no office which he holds. He is not employed in service and therefore this definition would not apply to Annadhanam. The making of a statement to the Investigator under section 33(3) of the does not amount to furnishing information on any subject to any public servant as contemplated by a. 176 I. P. C., an omission to furnish which would be an offence under that section. This section refers to information to be given in statements required to be furnished under some provision of law. We are therefore of opinion that a. 176. I. P. C. did in no way compel Dalmia to make the statement Exhibit P. 10. We believe the statements of Annadhanam and Khanna about Dalmia 's making the statement Exhibit P. 10 without his being induced or threatened by them. Their statements find implied support from the statement of Raghunath Rai with respect to what Dalmia told him in connection with the making of the statement to Annadhanam, and from certain statements of Dalmia himself in his written statement and in answers to questions put to him under section 342, Cr. P. C. We therefore hold the statement Exhibit P. 10 is a voluntary statement and is admissible in evidence. 381 We also hold that it is not inadmissible in view of cl. (3) of article 20 of the Constitution. It was not made by Dalmia at a time when he was accused of an offence, as is necessary for the application of that clause, in view of the decision of this Court in The State of Bombay vs Kathi Kalu Oghad (1) where the contention that the statement need not be made by the accused person at a time when he fulfilled that character was not accepted. Dalmia was not in duress at the time he made that statement and therefore was not compelled to make it. It was said in the aforesaid case : " "Compulsion ', in the context, must mean what in law is called duress. . The compulsion in this sense is a physical ob jective act and not the state of mind of the person making the statement, except where the mind has been so conditioned by some extraneous process as to render the making of the statement involuntary and, therefore, extorted." The various circumstances preceding the making of the statement Exhibit P. 10 by Dalmia have all been considered and they fall far short of proving that Dalmia 's mind had been so conditioned by some extraneous process as to render the making of this statement involuntary and therefore extorted. We believe the statement of Annadhanam that Dalmia had told him near the staircase that he had lost the money in his personal speculation business which was carried on chiefly through one of his private companies, viz. the Union Agencies. The later part of his confession, Exhibit P. 10, is an admission of Dalmia 's losing the (1) ; , 35. 382 money in speculation. His further statement was only an amplification of it as to the name under which speculation was carried on. the statement finds support from the facts established by other evidence that the speculation business carried on by the Union Agencies was really the business of Dalmia himself though, ostensibly, it was the business of the company of which there were a few shareholders other than Dalmia. Mr. Dingle Foot has urged that adverse inference be drawn against the prosecution case on account of the prosecution not producing certain documents and certain witnesses. We have considered the objection and are of opinion that there is no case for raising such an inference against the prosecution. The prosecution did not lead evidence about the persons holding shares in Asia Udyog Ltd., and in Govan Brothers Ltd. Such evidence would have, at best, indicated how many shares Dalmia held in these companies. That was not necessary for the prosecution case. The extent of shares Dalmia held in these companies had no direct bearing on the matter under inquiry in the case. The prosecution led evidence about the telephonic calls up to August 31, 1955, and did not lead evidence about the calls between September 1 and September 20. 1955, It is urged that presumption be raised that Dalmia and Chokhani had no telephonic communication in this period. Admittedly, Dalmia had telephonic communication with Chokhani on September 15. The prosecution has not impugned any transaction entered into by Chokhani during this period. It is not therefore essential for the prosecution to have led evidence of telephonic calls between Dalmia and Chokhani during this period. Another document which the prosecution is 383 said not to have produced is the Dak Receipt. Register. The Register could have at best shown on which dates the various advices received from Bombay about the transactions were received. On that point there had been sufficient evidence led by the prosecution. The production of the Register was there fore not necessary. The accused could have summoned it if he had particular reason to rely on its entries to prove his case. Lastly, complaint is made of the non production of certain documents in connection with the despatch of certain securities from Delhi to Bombay. Again, there is oral evidence with respect to such despatch of securities and it was not essential for the prosecution to produce the docu ments in that connection. Of the witnesses who were not produced, complaint is made about the prosecution not examining Mr. Barve, Joint Secretary, Ministry of Finance, who was present at the interview which Dalmia had with Mr. Kaul on September 15,1954, and of the non production of the Directors of the Insurance Company. It was quite unnecessary to examine Mr. Barve when Mr. Kaul has been examined. It was also not necessary to examine the Directors of the company who are not alleged to have had any first hand knowledge about the transactions. They could have spoken about the confirmation of the sale and purchase transactions and about the passing of the bye laws and other relevant resolutions at the meeting of the Board of Directors. The minutes of the proceedings of the Board 's meetings served this purpose. It is admitted by Dalmia that there was no ,resolution of the Board of Directors conferring authority on Chokhani to purchase and sell securities. Certain matters have been referred to at 384 pages 206 210 of Dalmia 's statement of came, which, according to Dalmia, could have been proved by the Directors. , All these matters are such which were not necessary for the unfolding of the prosecution case and could be proved by the accused examining them if considered necessary. We therefore see no force in this contention. It is urged for Dalmia that he could not have been a party to a scheme which would cause loss to the Insurance Company, because he was mainly responsible for the prosperity of the company. The Union Agencies has assets. The Government was displeased with Dalmia. The company readily agreed to the appointment of M/s. Khanna and Annadhanam as auditors. There was the risk of detection of the fraud to be committed and so Dalmia would have acted differently with respect to such affairs of the Union Agencies as have been used as evidence of Dalmia being synonymous with it. We are of opinion that these considerations are not such which would off,set the inferences arrived at from the proved facts. It cannot be it matter of mere coincidence that frequent telephonic conversations took place between Dalmia and Chokhani when the Union Agencies suffered losses, that the usual purchase transactions by which the funds of the Insurance Company were diverted to the Union Agencies took place then, that such purchases should, recur several times during the relevant period, that such securities which could not be recouped had to be shown as sold and when the Union Agencies or Bhagwati Trading Company could not pay for the sale price which had to be credited to the account of the Insurance Company, a further usual purchase transaction took place. We are therefore satisfied from the various facts considered above that the transactions which 385 led to the diversion of funds of the Insurance Company to the Union Agencies were carried through under the instructions and approval of Dalmia. It is clear that he had a dishonest intention to cause at least temporary loss of its funds to the Insurance Company and gain to the Union This could be achieved only as a result of the conspiracy between him and Chokhani. Vishnu Prasad was taken in the conspiracy to facilitate diversion of funds and Gurha to facilitate the making up of false accounts etc. in the offices of the Union Agencies and Asia Udyog Ltd., as would be discussed hereafter. We may now turn to the charges against Gurha, appellant. He was charged under section 120 B read with section 409 I. P. C. and also on three counts under section 477 A for making or abetting the making of false entries in three journal vouchers Nos. 98, 106 and 107 dated January 12, 1955, of the Union Agencies. It is necessary to give a brief account of how these vouchers happened to be made. Gurha was a Director of the Union Agencies and looked after the work of its office at Delhi. He was also the Accountant of Asia Udyog Ltd. At Delhi there was a ledger with respect to the account of the transactions by the Bombay Office of the Union Agencies. Under the directions of Chokhani who was an agent of the Union Agencies at Bombay and also held power of attorney on its behalf. Kanna used to send a cash statement and a journal to the Bombay Office and the Union Agencies at Delhi. These documents used to be sent to Gurha personally. Now, the cash statement from Bombay showed correctly entries of the amounts received from Bhagwati Trading Company. Such amounts were noted to the credit of Bbagwati Trading Company. When the Union Agencies made Payment to Bhagwati 386 Trading Company, an entry to that effect was noted in the cash statement to the debit of Bhagwati Trading Company. On receipt of these cash statements in 1955, it is alleged, Gurha used to get the genuine cash statement substituted by another fictitious cash statement in which no mention was made of Bhagwati Trading Company. Entries to the credit of Bhagwati Trading Company used to be shown to be entries showing the receipt of those moneys from the Delhi Office of the Union Agencies through Chokhani. The debit entry in the name of Bhagwati Trading Company used to be shown as a debit to the Delhi Office of the Union Agencies. This substituted cash statement was then made over to one Lakhotia, who worked in the Delhi Office of the Union Agencies on behalf of the Bombay Office of the company. He was also prosecuted, but was acquitted. Lakhotia issued credit advices on behalf of the Bombay Office of the Union Agencies to the Delhi Office of the Union Agencies in reference to the entry in the cash statement which, in the original statement, was in respect of the amount received from Bhagwati Trading Company, intimating that amount had been credited by the Bombay Office to the account of the Delhi Office. A debit advice on behalf of the Bombay Office to the Delhi Office was issued intimating that the amount had been debited to the account of the Delhi Office when in fact, the original entry debited that amount to the account of Bhagwati Trading Company. Lakhotia also made entries in the ledger of the Bombay Office which was maintained in the Delhi Office of the company. In its column entitled 'folios ' reference to the folio of the cash statement was given by writing the letter 'C ' ' and the number of the folio of the cash statement from which the entry was posted. On receipt of such advices from Lakhotia on behalf of the Bombay Office, Dhawan, P. W,19, 387 Accountant of the Delhi Office of the Union Agencies used to prepare the journal voucher. In the case of the credit advices, the amount was debited to the Bombay Office of the Union Agencies and credited to Asia Udyog Ltd. In the case of the debit advices, the amount was debited to Asia Udyog Ltd., and credited to the Bombay Office of the Union Agencies. According to the statement of Dhawan, he did so under the instructions of Gurha. Gurha used to sign these vouchers and when he fell ill,, they were signed by another Director, J. section Mittal. Corresponding entries used to be made in the account of the Bombay Office and the Asia Udyog Ltd., in the ledger of the Delhi Office of the Union Agencies. After Dhawan had prepared these vouchers he also used to issue advices to Asia Udyog Ltd. intimating that the amount mentioned therein had been credited or debited to its account. Thus the name of Bhagwati Trading Company did not appear in the various advises, vouchers and the ledgers prepared at Delhi. In the office of Asia UdyogLtd., on receipt of the credit advice, a journalvoucher crediting the amount to the Bombay Officeand debiting it to the Delhi Office of the Union Agencies was prepared. A journal voucher showing the entries in the reverse order was prepared on the receipt of the debit advices. Asia Udyog Ltd., issued advice to the Bombay Office intimating that the amount had been credited or debited to the Bombay Office of the Union Agencies in the case of vouchers relating to the credit or debit advice from that Office. All such vouchers in Asia Udyog Ltd. were signed by Gurha even during the period when he was ill and was not attending the office of the Union Agencies. The result of all such entries in the vouchers Was that on paper it appeared in the case of credit 388 advices that the Delhi Office of the Union Agencies advanced money to the Bombay Office which paid the money to Asia Udyog Ltd., which in its turn, paid the money to the Delhi Office of the Union Agencies, and in the case of debit advices, the Bombay Office debited the amount to Delhi Office of the Union Agencies and that debited it to Asia Udyog Ltd., which in its turn debited it to the Bombay Office. All these entries were against facts and they must have been done with a motive and apparently it was to keep off the records any mention of Bhagwati Trading Company. No explanation has been given as to why this course of making entries was adopted. The genuine cash statements are on record. The alleged fictitious statements are not on the record. It is not admitted by Gurha that any fictitious cash statement was prepared. It is not necessary for our purposes to bold whether a fictitious cash statement in lieu of the genuine cash statement received from Bombay was prepared under the directions of Gurha or not. The fact remains that the entries in the various advices prepared by Lakhotia on the basis of the cash statements received, did not represent the true entries in the genuine cash statements and that journal vouchers prepared by Dhawan also showed wrong entries and did not represent facts correctly. Of the journal vouchers with respect to which the three charges under section 477 A, 1. P. C. had been framed, two are the vouchers prepared by Dhawan crediting the amounts mentioned the rein to Asia Udyog Ltd., and debiting them to the Bombay Office of the Union Agencies. They are Exhibits P. 2055 and P. 2060. Each of them is addressed to Asia Udyog Ltd. and states that the amount mentioned therein was the amount received by the former, i. e. the Bombay Office from Chokhani on account of the latter, i, e., Asia Udyog Ltd., on 389 January 7 and January 10, 1955,respectively and adjusted. One Exhibit P.2042 debits the amount to Asia Udyog Ltd, and credits it to the Bombay Office of Union Agencies and states the amount mentioned therein to have been paid by the latter, i.e., Bombay Office to Chokhani on account of the former, i.e Asia Udyog Ltd., and adjusted. Other facts which throw light on the deliberate preparation of these false vouchers are that there had been tampering of the ledger of the Bombay Office in the Delhi Office of the Union Agencies and also in the journal statement of that office. The letter "C ' in the folio column of the ledger had been altered to 'J ' indicating that entry referred to an entry in the journal statement received from Bombay. Sheets of the journal statement on which corresponding entries are noted have also been changed. These two documents remained in the possession of the Union Agencies till November 12, 1955, though the advices and vouchers in the Delhi Office were seized by the Police on September 22, 1955, and therefore interested persons could make alterations in them. It has been suggested for Gurha that the alterations were made by the Police. The suggestion has not been accepted by the learned Sessions Judge for good reasons. The changed entries did not in any way support the prosecution case and therefore the police had no reason to get those entries concocted. The entries did show the receipt of the amounts from Bhagwati Trading Company, but the prosecution case was that the amount was received in cash and not through transfers which transactions had to be adjusted. The learned Sessions Judge, did not, however, believe the statement of Sri Kishen Lal who investigated the case that he had noticed these alterations earlier than his statement in Court Which was some time in 1958, for the reason that 390 Dhawan was not questioned by the prosecution in this regard and no reference was made by Sri Kishen Lal in the case diary about his questioning Dhawan about the alterations. The learned Sessions Judge appears to have overlooked the statement of Sri Kishen Lal to the effect: "I made a note in the case diary about myself having put the overwriting to Lakhotia and about having asked his explanation about that." The Court could have verified the fact from the case diary. It is too much to suppose that Sri Kishen Lal would make a wrong statement whose inaccuracy could be very easily detected. However, the learned Session Judge himself has given good reasons for not accepting the suggestion that the over writing of the letter 'C ' by the letter 'J ' and the changing of the journal papers were made by the police. The part that Gurha played in getting these false entries prepared is deposed to by Dhawan, P.W. 19, who used, occasionally, to approach Gurha for instructions. Further, Gurha, as the accountant of Asia Udyog Ltd., must have known that Asia Udyog Ltd., bad neither advanced any amounts to ' the Bombay Office of the Union Agencies nor received any amounts from the Bombay Office of the Union Agencies. He however signed all the vouchers prepared in the office of Asia Udyog Ltd., in connection with these transactions. He did so even during his illness (May, 1955, to July, 1955, which, according to the statement of Gurha, in answer to question No. 134 was from March 15 to August 12, 1955, during which period he did not attend the office of the Union Agencies). He signed them deliberately to state false facts, 391 Dhawan particularly stated that on receipt of the advice, Exhibit P. 2041, on the basis of which journal entry No. 98 was prepared by him, he went ' to Gurha to consult as it was not clear from that advice to whom the amount mentioned in it had ' been paid. Gurha, on looking up the Journal state ment received from the Bombay Office told him to debit that amount to Asia Udyog Ltd. Dhawan prepared journal voucher P. 2042, accordingly, and Gurha initialed it. It may be mentioned that this debit advice was addressed to M/s. Delhi Office and therefore could be taken to refer either to the Delhi Office of the Union Agencies or the Delhi Office of ' Asia Udyog Ltd., both these offices being in the ' same building and being looked after by Gurha. Gurha admits in his statement under s.342, Cr P. C., that Dhawan referred this matter to him and that he asked him to debit the amount to Asia Udyog Ltd., The journal statement of the Bombay Office at the relevant time could have no reference to this item which was really entered in the cash statement and Gurha 's conduct in looking up the journal was a mere ruse to show to Dhawan that was giving instructions on the basis of the entries and not on his own. Gurha stated, in answer to question No. 45, that he remembered to have seen an entry relating to this amount of Rs. 4,61,000 which is the amount mentioned in exhibit P. 2042 in the cash statement of the Bombay Office of the Union Agencies when O.P. Dhawan referred an advice relating to that amount to him. In answer to questions Nos. 217 and 218, in connection with his advising Dhawan about the debiting of this amount to Asia Udyog Ltd., he stated that he gave that advice after tracing the relevant entry in the journal statement of the Bombay Office. This answer is not consistent with his earlier answer to question No. 45 as entry with respect to the same amount could not have existed 392 simultaneously both in the cash statement and the journal statement of the Bombay Office. If his later answer is correct, his referring to the journal would have been just a ruse as already stated. If his earlier answer is correct that would indicate that either Gurha had supplied the office with the fictitious cash statement of the Bombay Office as alleged by the prosecution or that seeing in the journal cash statement that the entry related to Bhagwati Trading Company, deliberately told Dhawan, in accordence with the scheme, to debit that amount to Asia Udyog Ltd. In either view of the matter, this conduct of Gurha in advising Dhawan to debit the amount to Asia Udyog Ltd., is sufficient to indicate his complicity in the whole scheme, as otherwise, he had no reason to behave in that manner. Gurba, among the accused, must have been chosen for the purpose of the conspiracy because he had connection both with the Union Agencies and with Asia Udyog Ltd. He had been in the employ of a Dalmia concern from long before. He was the Accountant of the Dalmia Cement and Paper Marketing Company from 1948 till its liquidation in 1953. Gurha, as Director of the Union Agencies, knew that it had suffered losses as a result of sharespeculation business in 1954 55 and that the Delhi Office was short of liquid funds to meet these losses. He must have known how the funds to meet the losses were being secured from the funds of the Insurance Company through Bhagwati Trading Company. He must have also known that this was wrong. It is only with such knowledge that he could have been a party to the making of false ad vices and vouchers. There could be DO other reason. It could not have been possible for the prosecution to lead direct evidence about Gurha 's knowledge with respect to the full working of the scheme to provide for the losses of the Union Agencies from the funds of the Insurance Company. It is further 393 not, necessary that each member of a conspiracy must know all the details of the conspiracy. Mr, Kohli, for Gurha, has urged that Gurha could have had nothing to do with the diversion of the funds of the Insurance Company to the Union Agencies, even though he was a Director of the latter as he never issued instructions regarding the activities of the Union Agencies, had no knowledge of the passing of money from the funds of the Insurance Company to the Union Agencies as he had nothing to do with the movement of the securities held by the Insurance Company or the receipt of cash or the other transactions, his role having begun, according to the prosecution, after the offence under section 409 1. P. C. had been actually commit ted, i.e., after Chokhani had issued cheques on the bank accounts of the Insurance Company with the Chartered Bank in favour of Bhagwati Trading Company, and therefore could know nothing regarding the diversion of funds and the desirability of falsifying the accounts and papers of the Office; he had to deal with. Great reliance is placed on the letter, Exhibit B. 956 in submitting that Gurha did not know about the whole affair and simply knew, as stated by him, that Chokhani had borrowed money for the Union Agencies to pay its losses, from Bhagwati Trading Company. This letter is of significance and we quote it in full "Girdharilal Chokhani Times of India Building, Horn by Road, Bombay 1. CONFIDENTIAL 17th September 55. Bharat Union Agencies Ltd., Delhi. Mr. R. P. Gurha Dear Sir, I have to inform you that the various a mounts 394 arranged by me as temporary loans to Bharat Union Agencies Ltd., Bombay Office from time to time in the name of Bbagwati Trading Company, actually represented the monies relating to the undernoted securitiesbelonging to Bharat Insurance Company Limited. Face Value 2 1/2% 1961 Rs. 56,00,000 3% 1963 65 Rs. 79,00,000 3% 1966 68 Rs. 60,00,000 Rs. 1,94,00,000 I have now to request you to please arrange at your earliest to pay about Rs. 1,80,00,000 in cash or purchase the a fore said securities (or their equivalent) and deliver the same to Bharat Insurance Company Ltd., 10, Daryaganj, Delhi on my behalf, debiting the amount to the credit standing in the books of the Company 's Bombay Office in the name of M/s Bbagwati Trading Company. Any debit or credit balance left thereafter in the said account would besettled later on. I am getting this letter also signed by Vishnuprasad on behalf of Bhagwati Trading Company although he had neither any knowledge of these transactions nor had any connection with these affairs. Yours faithfully, For: Bbagwati Trading Company Sd/ G. L. Cho khani Sd. Illegible Vishnuprasad Bairanglal Proprietor. " We are of opinion that this is a letter written for the purpose of the case and was, as urged for 395 the State,. ante dated. There is inherent evidence in this letter to support this view. The letter makes a reference to Vishnu Prasad 's having no knowledge of the transactions and having no connection with the affairs. Mention of these facts was quite out of place in a letter which Chokhani was addressing to Gurha in the course of business for his immediately arranging for the payment of Rs. 1,80,00,000 in cash or. securities to Bharat Insurance Company. Further, the opening expression in the letter does not necessarily mean that Gurha was being informed for the first time that the temporary loans arranged by him for the Union Agencies Ltd., in the name of 'Bhagwati Trading Company actually represented the moneys belonging to the Bharat Insurance Company. If it meant so, that must have been done so by design, just as the concluding portion of the letter was, as already mentioned, put in by design to protect Vishnu Prasad 's interest. The letter is dated September 17, 1955, and thus purports to have been written a few days before the formal complaint was made to the police. Even if it was written on September 17, it was written at a time when the matter of securities had come to the notice of the authorities and Dalmia was being pressed to satisfactorily explain the position of the securities. Chokhani could have written a letter of this kind in that setting. Another fact relied upon by the learned Sessions Judge in considering this letter to be antedated is that it does not refer to one kind of securities which were not in the possession of the Insurance Company even though they had been ostensibly purchased. It does not mention of the securities worth Rs. 26,25,000 which were really supplied to the Insurance Company on September 23, 1955. This letter should have included securities of that amount and should have asked Gurha to make up 396 for that amount to the Insurance Company. This is a clear indication that this letter was written after September 23, 1955. Mr. Kohli has, however, urged that the contract for the purchase of these securities had taken place on September 16, 1955, and that therefore Chokhani did not include those securities in this letter. Reference is made to the statement of Jayantilal, P.W. 6, a partner of the Firm Devkaran Nanjee, Brokers in Shares and securities. He states that Bhagwati Trading Company wanted to purchase for immediate delivery 3% 1966 68 securities of the face value of Rs. 21,25,000 and that a contract about it was entered into. Securities of this amount were not available in the market. Securities worth Rs. 1,75,000 were available and were delivered to Chokhani that day. They had to purchase securities of the face value of Rs. 20,00,000, from the Reserve Bank of India in order to effect delivery and had to sell some other securities of that value. The result was that the required securities were received by them on September 22, 1955. Even this statement does not account for not including securities of the value of Rs. 4,50,000 in this letter exhibit P. 956. It was further urged in the alternative that Chokhani had very extensive powers in all the alleged concerns of Dalmia and so could get anything done due to his influence without divulging secrets. That was not the position taken by Gurha in his statement. Ho did not say that he deliberately got false documents prepared due to directions from Chokhani and which he could not disregard. Even if it be so, that means that Gurha got false documents made deliberately. Another submission for Gurha is that the case held proved for convicting him is different from the case as sought to be made out in the police chargesheet submitted to the Court under section 173 of the 397 Code of Criminal Procedure. The charge sheet is hardly a complete or accurate thesis of the prosecution case. Clause (a ) of sub section (1) of section 173, Cr. P.C., requires the officer in charge of the police station to forward to the Magistrate empowered to take cognizance of the offence on a police report, the report in the prescribed form setting forth the names of the parties, the nature of the information, and the names of the persons who appear to be acquainted with the circumstances of the case. Nothing further need be said on this point. Further, it is submitted that the prosecution case has changed from stage to stage. This can only mean that facts came on the record which were not known before and therefore the complexion of the allegations against Gurha 's conduct varied. Even if this is so, he can have no grievance against it unless he bad been unable to meet it in defence. No such inability has been expressed. It is however stated that the prosecution based its ultimate case against him on the allegation that the cash statement received from Bombay was suppressed and another false cash statement was prepared at Delhi under the directions of Gurha. We have already dealt with this matter. There was no such allegation on the basis of the statement of any prosecution witness. This way really a suggestion to explain how despite certain entries in the cash statements received from Bombay different entries were made in the advices issued by Lakhotia which advices ought to have been in accordance with the entries in the cash statement. The suggestion may be correct or may not be correct. It cannot, however, be said on its basis that there has been such a change in the prosecution case as would make the prosecution case reasonably doubtful. In the same connection, a grievance has been made that Gurha was not questioned about the 398 allegation that the cash statement had been suppressed and substituted by another fictitious one. No such question could have been put to him when there was no evidence about it. An accused is questioned under section 342 Cr. P. C., to explain any circumstances appearing in the evidence against him. It is not necessary to ask him to explain any inference that a Court may be asked to draw and be prepared to draw from the evidence on record. Another point stressed for Gurha is that the cash statements would not have mentioned Bhagwati Trading Company when the prosecution case is that Chokhani took deliberate steps to keep the Delhi Office of the Insurance Company in the dark about it. The fact is that the cash statement sent from Bombay did mention Bhagwati Trading Company. They were sent to Gurha personally. In the circumstances the reasonable conclusion can be that they mentioned Bhagwati Trading Company as that represented the true state of affairs and Chokhani had to inform the Delhi Office of the Bharat Union Agencies about the source of the money he was receiving for the Union Agencies to meet its losses. Chokhani did not disclose the true source, but disclosed a source fictitiously created to conceal the real source. There was no harm in disclosing Bhagwati Trading Company to the office of the Union Agencies at Delhi. With the same frankness it could not have been disclosed to the Insurance Company Office at Delhi both because that would required the complicity of the entire staff of the Insurance Company in the conspiracy and because otherwise, it would at once disclose to the Insurance Company and those who had to check its working that its funds were being miscued. Disclosure of Bhagwati Trading Company to the Union Agencies was necessary and there was no harm in any way in informing Gurha confidentially about it. After Gurha had got possession of the cash 399 statement it was for him how to direct the necessary entries to be made in the advices prepared by Lakhotia on behalf of the Bombay Office at Delhi and on the basis of which journal vouchers were to be prepared by Dhawan and entries were to be made in the accounts of the Union Agencies at Delhi. We therefore do not consider that this contention in any way favours the appellent. The fact that the account of the Asia Udyog Ltd., in the ledger Exhibit P. 2226 is not alleged to be fictitious and records in the column folio ' the letter 'J ' is of no help as the entries in that ledger must have been made on the basis of the journal vouchers issued by Dhawan. In fact once it is alleged that the advices issued by Lkhotia were fictitious any entry which can be traced to it must also be fictitious. It is argued that the alleged scheme of making the circuitious entries could not have worked in keeping the source of money concealed as the Income tax Authorities could have detected by following the entries in the Bank records with respect to the source of payment of money (by cheques issued by Bhagwati Trading Company) to the Union Agencies at Bombay. They could have thus known only about Bhagwati Trading Company and, as already stated, it was not necessary to keep Bhagwati Trading Company secret from the Union Agencies. What was really to be kept secret was that the money came from the Insurance Company. The various circuitous entries were not really made to keep Bhagwati Trading Company unknown, but were made to make it difficult to trace that the money really was received from the Insurance Company. A suggestion has been made by Mr. Kohli that Chokhani might have showed the same amount both in the cash statement and in the journal statement. No such case, however, seems to have been 400 raised in the Courts below and has been made in the appellant 's statement of case. It has been contended that an offence under section 477A 1. P. C. has not been established against the accused as it is not proved that he falsified any book, papers, etc., in the possession of his employer with intent to defraud and that the intention to defraud should be to defraud someone in future and should not relate to an attempt to cover up what had already happened. It is submitted that an intent to defraud connotes an intention to deceive and make the person deceived ,suffer some loss, that the entries made in the journal vouchers did not make anyone suffer and therefore the entries could not be said to have been made with intent to defraud. The expression intent to defraud ' is not defined in the Penal Code but section 25 defines 'fraudulently ' thus: "A person is said to do a thing fraud. ulently, if he does that thing with intent to defraud and not otherwise. " The vouchers were falsified with one intention only and that was to let it go unnoticed that the Union Agencies bad got funds from the Insurance Company. If they had shown the money received an( paid to Bhagwati Trading Company, it was possible to trace the money back to the Insurance Company through Bhagwati Trading Company which received the money from the Insurance Company through cross cheques as well. Whoever would have tried to find out the source of the money would have been deceived by the entries. The Union Agencies mad wrongful gain from the diversion of the Insurance Company 's funds to it through Bhagwati Trading Company and the Insurance Company suffered loss of funds. The false entries were made to cover 401 up the diversion of funds and were thus to conceal and therefore to further the dishonest act already committed. We agree with respect with the following observation in Emperor vs Ragho Ram (1) at page 788: "If the intention with which a false document is made is to conceal a fraudulent or dishonest act which had been previously com mitted, we fail to appreciate how that inten tion could be other than an intention to commit fraud. The concealment of an already committed fraud is a fraud. " And, again, at page 789: "Where, therefore, there is an intention to obtain an advantage by deceit there is fraud and if a document is fabricated with such intent, it is forgery. A man who deliberately makes a false document in order to conceal a fraud already committed by him is undoubtedly acting with intent to commit fraud, as by making the false document he intends the party concerned to believe that no fraud had been committed. It requires no argument to demonstrate that steps taken and devices adopted with a view to prevent persons already defrauded from ascertaining that fraud had been perpetrated on them, and thus to enable the person who practiced the fraud to retain the illicit gain which he secured by the fraud, amount to the commission of a fraud. An act that is calculated to conceal fraud already committed and to make the party defrauded believe that no fraud had been committed is a fraudulent act and the person responsible for the act acts fraudulently within the meaning, of section 25 of the Code." (1)1933J 1 L. R. 55 All. 783, 788, 789, 402 We agree, with this observation, and repel the contention for the appellant. It, has then been submitted that the falsification should have been necessarily connected with the commission of the breach of trust. There is no question of immediate or remote connection with the commission of breach of trust which is sought to be covered up by the falsification, so long as the falsification is to cover that up. In the present case, introduction of Bhagwati Trading Company in the transactions was the first step to carry out deception about the actual payment of money out of the funds of the Insurance Company to the Union Agencies. The second step of suppressing the name of Bhagwati Trading Company in the papers of the Union Agencies Delhi, made it more difficult to trace the passing of the money of the Insurance Company to the Union Agencies and therefore the falsification of the journal vouchers related back to the original diversion of the Insurance Companys moneys to the Union Agencies and was with a view to deceive any such person in future who be tracing the source of the money received by the Union Agencies. A grievance is made of the fact that certain witnesses were not examined by the prosecution. Of the persons working for the Union Agencies, five were accused at the trial, Kannan, Lakhotia, Gurha, Mittal and Dudani. Only Gurha among them was convicted. The others were acquitted. 'The remaining persons were Krishnan, Panohawagh and the clerks O. D. Mathur and Attarshi. Of the persons connected with Asia Udyog, one R. section Jain of the Accounts Branch was not examined. Panchawagh who was an Accountant of the Union Agencies and had custody of the cash statements and journal was given up by the prosecution on the ground that 403 he was won over. We do not consider that it was necessary to examine him for the unfolding of the prosecution case against Gurha. Similarly it was not necessary to examine the others for that purpose. A mere consideration that they might have given a further description of how things happened in those offices would not justify the conclusion that the omission to examine them was an oblique motive and could go to benefit the accused. A grievance was made that the High Court did not deal with the question whether the police tampered with the cash statement and the journal. It is not clear whether such a point was raised in the High Court. It was however not mentioned in the grounds of appeal. The trial Court did deal with the point and held against the appellant Gurha. In fact, paragraph 22 of the grounds of appeal by Gurba simply said that no value should have been attached to the said cuttings when it was not proved on the record as to who made the said cuttings and when they were not calculated to conceal the true facts or the further interest of the conspiracy. We are therefore of opinion that Gurha has been rightly held to have been in the conspiracy and to have abetted the making of the false journal vouchers. In view of the above, we are of opinion that the appellants have been rightly convicted of the offences charged. It has been urged for Chokhani that his sentence be reduced to the period already undergone as he made no profit for himself out of the impugned transactions, that he is 59 years old and had already been ten days in jail. We do not consider these to justify the reduction of the sentence when 404 he was the chief person to carry out the main work of the conspiracy. We also do not consider Dalmia 's sentence, in the circumstances of the case, to be severe. We therefore dismiss these appeals. Appeals Dismissed.

Appellant Dalmia was the Chairman of the Board of Directors and Principal Officer of the Bharat Insurance company and appellant Chokhani its agent in Bombay. Appellant Vishnu Prasad, nephew of Chokhani, was the nominal owner of Bhagwati Trading Company but its business was entirely conducted by Chokhani. Gurha, the other appellant, was a Director of Bharat Union Agencies, a company dealing in for ward transactions of speculation in shares, and owned for all practical purposes by Dalmia. This Company suffered heavy losses in its business during the period August, 1954, to September, 1955. The prosecution case against the appellants in substance was that in order to provide funds for the payment of those losses in due time, they entered into a conspiracy, along with five others, to divert the funds of the Insurance company to the Union Agencies through the Bhagwati Trading Company and to cover up such unauthorised transfer of funds, the various steps for such transfer and the falsification of accounts of the Insurance Company and the Union Agencies and its allied concern and committed offences under section 120B read with section 409 of the Indian Penal Code. Dalmia made a confession before Mr. Annadhanam, a Chartered Accountant, who was appointed Investigator under s.33(1) of the , which was as follows: "I have misappropriated securities of the order of Rs. 2,20,00,000 of the Bharat Instirance Company Ltd. I have lost this money in speculation. " 254 "At any cost, I want to pay full amount by requesting by relatives or myself in the interest of the policy holders". The prosecution primarily depended upon the evidence of Raghunath Rai, the Secretary cum Accountant of the Insurance Company, and it was contended on behalf of the appellants that he was an accomplice. The Sessions judge convicted all the appellants under section 120B read with section 409 of the Indian Penal Code, and further convicted Dalmia and Chokhani for substantive offences under section 409, Chokhani under section 477A read with section 110 and Gurha under section 477A of the Indian Penal Code. He however acquitted the others. The High Court in substance agreed with the findings of the Sessions judge, except that it did not rely on the confession of Dalmia. Held, that the Delhi Court had jurisdiction to try Chokhani for the offence under section 409 of the Indian Penal Code, committed beyond its jurisdiction in pursuance of the alleged conspiracy with which he and the other co accused were charged. Purushottam Das Dalmia vs State of West Bengal, [1962] 2 section C. R. 101, followed. The charge against Dalmia under section 409 of the Indian Penal Code was not hit by section 233 of the Code of Criminal Procedure. The charge framed was not for four distinct offences. It was really with respect to one offence though the mode of committing it was not precisely stated. Any objection as to the vagueness of the charge on the score could not invalidate the trial since no prejudice had been caused to the accused nor any contention raised to that effect. The word property used in section 405 of the Indian Penal Code could not be confined to movable property since the section itself did not so qualify it. The word 'property ' was much wider than the expression In lovable property ' defined in section 22 of the Code. The question whether a particular offence could be committed in respect of any property depended not on the meaning of the word 'property ' but on whether that property could be subjected to that offence. 'Property ' in a particular section could, therefore, mean only such kind of property with respect to which that offence could be committed, The funds of the Bharat Insurance Company referred to in the charge amounted to property within the meaning of section 405 of the Indian Penal Code. 255 Reg. Girdhar Dharamdas (1869) 6 Bom. High Ct. Rep. (Crown Cases) 33, and Jugdown Sinha vs Queen Empress (1895) 1. L. R. , disapproved. Emperor vs Bishan Prasad, All. 128, Ram Chand Gurvala vs King Emperor A. 1. R. , Manchersha Ardeshir vs Ismail Ibrahim, Bom. 706, Daud Khan vs Emperor A. I. R. 1925 All. 672 and The Delhi Cloth and General Mills Co. Ltd. vs Harnam Singh, , referred to. The relevant articles and bye laws of the Insurance Company and the resolutions passed by its Board of Directors established that both Dalmia and Chokhani were entrusted with dominion over the funds of the company in the Banks within the meaning of section 409 of the Indian Penal Code. Peoples Bank vs Harkishan Lal, A. I. R. , G. E, Ry. Co. vs Turner, L. R. and Re. Forest of Dean Etc. Co., L. R. refer red to. The offence of Criminal breach of trust could be committed by Chokhani even though he alone could not operate the Bank account and could do so jointly with another. Bindeshwari vs King Emperor Pat. 703, held inapplicable. Nrigendro Lall Chatterjee vs Okhoy Coomar Shaw, (1874) (Cr. Rulings) 59 and Emperor vs Jagannath Ragunathdas, , referred to. The expression 'in the way of business as agent ' occurring in section 409 of the Indian Penal Code meant that the property must have been entrusted to such agent in the ordinary course of his duty or habitual occupation or profession or trade. He should get the entrustment or dominion in his capacity as agent and the requirements of the section would be satisfied if the person was an agent of another and that person entrusted him with the property or with dominion over the property in the course of his duties as an agent. A person might be an agent of another for some purpose and if he was entrusted with property not in connection with that purpose but for another purpose, that would not be entrustment within the meaning of section 409 of the Code. Mahumarakalage Edward Andrew Cooray vs Queen. [1953] A. C. 407 and Reg. vs Portugal, , considered. 256 Both Dalmia and Chokhani were agents of the Bharat Insurance Company within the meaning of section 409 of the Code. Gulab Singh vs Punjab Zamindara Bank, A. I. R. , referred to. Raghunath Rai was not an accomplice as he did not participate in the commission of tile actual crime charged against the accused. An accomplice must be a particeps criminal, except where he was a receiver of stolen property or an accomplice in a previous similar offence committed by the accused when evidence of the accused having committed crimes of identical type on other occasions was admissible to prove the system and intent of the accused committing the offence charged. Davies vs Director of Public Prosecutions, referred to. Chokhani was a servant of the Insurance Company within the meaning of section 477A of the Indian Penal Code. He was a paid Agent of the company and as such was its servant even though he was a full time servant of the Bharat Union Agencies. Each transaction to meet the losses of the United Agencies, was not an independent conspiracy by itself. There was identity of method in all the transactions and they must be held to originate from the one and same conspiracy. Since the confession made by Dalmia had not been shown to have been made under any threat or inducement or promise from a person in authority, it could not be anything but voluntary even though it might have been made for the purpose of screening the scheme of the conspiracy and the High Court was in error in holding that it was otherwise. A person appointed an Investigator under section 33(1) of the did not ipso facto become a public servant within the meaning of section 21, Ninth, of the Indian Penal Code and section 176 of the Indian Penal Code could have no application to an examination held under section 33(3) of the Act. The confession of Dalmia was not hit by article 20(3) of the Constitution since it was not made by him at a time when he was accused of an offence. State of Bombay vs Kathi Kalu Oghad, R. ; , referred to. The expression 'with intent to defraud ' in section 477A of the Indian Penal Code did not mean intention to defraud someone in the future and could relate to an attempt to cover up what had already happened. 257 Emperor vs Ragho Ram, I. L. R. (1933) 55 All. 783, approved,

Appeal No. 460 of 1987. 388 From the Judgment and Order dated 14.4. 1986 of the Jammu & and Kashmir High Court in Civil 1st Appeal No. 54 of 1985. Altar Anjad, Adv. General and S.K. Bhattacharya for the Appellants. S.M. Aquil and Shakeel Ahmed for the Respondents. The Order of the Court was delivered by THAKKAR, J. To condone, or not to condone, is not the only question. Whether or not to apply the same standard in applying the "sufficient cause" test to all the litigants regardless of their personality in the said context is another. An appeal preferred by the State of Jammu & Kashmir arising out of a decision enhancing compensation in respect of acquisition of lands for a public purpose to the extent of nearly 14 lakhs rupees by making an upward revision of the order of 800% (from Rs. 1000 per kanal to Rs.8000 per kanal) which also raised important questions as regards principles of valuation was dismissed as time barred being 4 days beyond time by rejecting an application for condonation of delay. Hence this appeal by special leave. The legislature has conferred the power to condone delay by enacting Section 51 of the Indian of 1963 in order to enable the Courts to do substantial justice to parties by disposing of matters on 'merits '. The expression "sufficient cause" employed by the legislature is adequately elastic to enable the courts to apply the law in a meaning ful manner which subserves the ends of justice that being the life purpose for the existence of the institution of Courts. It is common knowledge that this Court has been making a justifiably liberal approach in matters instituted in this Court. But the message does not appear to have percolated down to all the other Courts in the hierarchy. And such a liberal approach is adopted on principle as it is realized that: "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 satisfies the court that he had sufficient cause for not preferring the appeal or making the application within such period." 389 1. Ordinarily a litigant does not stand to benefit by lodging an appeal late. 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 con doned the highest that can happen is that a cause would be decided on merits after hearing the parties. "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. 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. 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. 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. Making a justice oriented approach from this perspective, there was sufficient cause for condoning the delay in the institution of the appeal. The fact that it was the 'State ' which was seeking condonation and not a private party was altogether irrelevant. The doctrine of equality before law demands that all litigants, including the State as a liti gant, are accorded the same treatment and the law is admin istered in an even handed manner. There is no warrant for according a stepmotherly treatment when the 'State ' is the applicant praying for condonation of delay. In fact experi ence shows that on account of an impersonal machinary (no one in charge of the matter is directly hit or hurt by the judgment sought to be subjected to appeal) and the in 390 herited bureaucratic methodology imbued with the note mak ing, file pushing, and passing on the buck ethos, delay on its part is less difficult to understand though more diffi cult to approve. In any event, the State which represents the collective cause of the community, does not deserve a litigant non grata status. The Courts therefore have to be informed with the spirit and philosophy of the provision in the course of the interpretation of the expression "suffi cient cause". So also the same approach has to be evidenced in its application to matters at hand with the end in view to do even handed justice on mertis in preference to the approach which scuttles a decision on merits. Turning to the facts of the matter giving rise to the present appeal, we are satisfied that sufficient cause exists for the delay. The order of the High Court dismissing the appeal before it as time barred, is therefore. set aside. Delay is condoned. And the matter is remitted to the High Court. The High Court will now dispose of the appeal on merits after affording reasonable opportunity of hearing to both the sides. Appeal is allowed accordingly. No costs. P.S.S. Appeal allowed.

An appeal by the State. against a decision enhancing compensation in respect of acquisition of lands for a public purpose, raising important questions as regards principles of valuation, was dismissed by the High Court as time barred, being four days beyond time, by rejecting an appli cation for condonation of dalay. The State appealed to this Court by special leave. Allowing the appeal, HLED: 1.1 The expression 'sufficient cause ' employed by the legislature in s.5 of the Indian is adequately elastic to enable the Courts to do substantial justice to parties by disposing of matters on merits. [388E F] 1.2 The State which represents the collective cause of the community. does not deserve a litigant non grata status. The doctrine of equality before law demands that all litigants, including the State as a litigant, are accorded the same treatment and the law is administered in an equitable man ner. The Courts, therefore, have to be informed with the spirit and philosophy of the provision in the course of the interpretation of the expression 'sufficient cause '. So also the same approach has to be evidenced in its application to matters at hand with the end in view to do even handed justice on merits in preference to the approach which scut tles a decision on merits. [390B C] 2. In the instant case, sufficient cause exists for delay in instituting the appeal in the High Court. Delay is, therefore, condoned. The matter is remitted to the High Court for disposal on merits. [390C D]

TION: Criminal Appeal No. 627 of 1988. From the Judgment and Order dated 10.6.1988 of the Bombay High Court in Criminal Writ Petition No. 257 of 1988. R.K.Garg and P.N.Gupta for the Appellant. Kuldip Singh, Additional Solicitor General, Arun Madan and P.Parmeshwaran for the Respondents. PG NO 1033 The Judgment of the Court was delivered by RAY, J. Special leave granted. Arguments heard. This appeal on special leave is against the judgment dated 10th June, 1988 made by High Court of Allahabad dismissing Criminal Writ Petition No. 257 of 1988 instituted by the detenu. The facts giving rise to this appeal are that on August 25, 1987 the house of the appellant was searched by the officers of the Enforcement Directorate under Section 37 of Foreign Exchange Regulation Act, 1973 and they seized currency notes of Re. 1 lakh and four bank drafts amounting to Rs.30,000, bank pass book and loose sheets Nos. 1 to 44 as per item No. 2 in panchnama dated August 25, 1987. The statement of detenu was recorded and he was arrested on the same day. On August 26, 1987 the detenu made an application in the Court of Addl. Chief Metropolitan Magistrate, 8th Court at Esplanade retracting his statement. The Magistrate made an order thereon that " Taken on record". An application for bail was moved on September 15, 1987 and an order had been made on that day releasing him on bail of Re. 1 lakh with a condition imposed that he would attend Enforcement Department Office every day between 11 a.m. to 2 pUll. until further order. The detenu filed an application on September 22, 1987 for variation of the said conditional order and the condition was varied by the Magistrate by directing that the detenu may attend the Enforcement Department as and which required. The Enforcement Directorate sent a letter directing the detenu to collect his passport deposit during the time of questioning. The passport however. remained with the Enforcement Department. Thereafter. on February 9. 1988 the impugned order of detention of the detenu in Central Prison, Bombay was made by the responded No. 1, the Joint Secretary, Government of India. The order of detention was served on the detenu on February 19, 1988 and the grounds of detention were furnished to him. A Criminal Writ Petition No. 257 of 1980 was filed before High Court, Bombay for quashing the said detention order on the grounds inter alia that certain vital documents such as the application dated September 21, 1987 for variation of the condition ot bail as well as the order passed by the Chief Metropolitan Magistrate varying the condition, the application dated August 26, 1987 retracting the statement by the detenu filed before the Magistrate and non consideration of the same, as well as the non supply of the copies of Bank pass books and loose papers seized from the residence of detenu and mentioned in panchnama dated PG NO 1034 August 25, 1987 which were placed before the detaining authority etc. vitiated the subjective satisfaction of the detaining authority on consequently the order of detention is illegal and bad. A Rule Nisi was issued. A return was filed by the respondent No. 1 wherein the detaining authority denied the allegations and stated that all vital and material documents which had been considered in forming his subjective satisfaction and mentioned in the grounds have been supplied to him and as such the impugned order of detention is not illegal and bad. The criminal writ petition was, therefore, dismissed. Aggrieved by the judgment of the High Court, the instant appeal on special leave has been filed. It was firstly contended on behalf of the appellant that the application for bail and the order dated September 15, 1987 by the Metropolitan Magistrate granting conditional bail of Re. 1 lakh with one surety of like amount though placed before the detaining authority, the application for variation of the condition and the order made thereon by the Magistrate on September 21, 1987 was not produced before the detaining authority. This is a vital document and non consideration of the same by the detaining authority results in the order being illegal. The decision in Ashadevi wife of Gopal Ghermal Mehta (detenu) vs K. Shiveraj, Addl. Chief Secretary to the Government of Gujarat & Anr. , ; was cited at the bar. In this case it has been observed by this Court thai documents which are vital and necessary for formation of subjective satisfaction,which is the pre requisite for making an order of detention having not been placed before the detaining authority before making the detention order. the order of detention will get vitiated. The detention was to prevent the detenu from indulging in Hawala business i.e. making various payments to various persons in this country on receiving instructions from Rafiq from Dubai. The application for variation if condition of bail and the order passed by the Metropolitan Magistrate varying the condition of bail is, in our opinion, not a vital and material documents in as much as the granting of bail by the Magistrate enabled the detention come out and carry on his business activities as before. Condition imposed by the Magistrate directing the detenu to appear before the office of the Enforcement Department every day between 11 a.m. to 2 p.m. has been varied to the extent that the accused to attend Enforcement Department as and when required". The condition imposed by the Magistrate has no relation to the activities carried on by the detenu and PG NO 1035 as such the High Court after considering all the circumstances held that the order varying the condition of bail was not a relevant document and failure to produce the document before the detaining authority before arriving at his subjective satisfaction had not vitiated the order. We agree with the same. The judgment delivered by the High Court, Bombay in Criminal Writ Petition No. 1304 of 1987 entitled Arvindbhai Purshottambhai Patel vs R. C. Iyer and Ors., on February 25. 1988 was referred to us. In this case the detenu was arrested for smuggling prohibited articles and the detenu was prosecuted for smuggling. He was granted bail by Magistrate on certain condition. Subsequently that order was varied. The initial order granting bail was placed before the detaining authority, but the subsequent order of variation was not placed. It was held by the Division Bench of the High Court that the order of modification might have influenced the detaining authority in forming his subjective satisfaction and as such the non placement of the same would vitiate the order. That was a case of smuggling of prohibited articles and the condition in the bail was that he would not leave the shores of the country and so he could not have indulged in smuggling activities pending decision of the case. This condition was relaxed by the subsequent order. In that context it was observed by the Court that the order of variation is a material document which might affect the formation of subjective satisfaction before passing the order of detention and the failure to place that document vitiated the detention order. This observation was made in the facts of that case. This case has no relevance in the facts of this case as we have held that in the present case the order of Variation is not a relevant and vital document. It has been submitted that the detenu made an application on August 26,1987 in the Court of Addl. Chief Metropolitan Magistrate. 8th Court. Esplanade retracting his statement whereon an order was made that "taken on record". This application was not placed before the detaining authority and this has vitiated the detention order as this vital document was not considered before arriving at the subjective satisfaction by the detaining authority. It may be convenient to mention that in the counter affidavit to the writ petition the respondent No. 1 has stated in para 5 that the application dated August 26, 1987 and the order passed thereon was not placed before him as the Sponsoring Authority did not know about the said application dated August 26, 1987 and the order thereon. The Enforcement Directorate was not aware of the said application and the order thereon. In any case, the respondent No. 1 has already stated that the retraction letter of detenu dated September PG NO 1036 20,1987 and the reply of the Directorate of Enforcement to the said letter of the detenu dated August 26,1987 was placed before the detaining authority. This submission, therefore, has no merit as the detaining authority knew about the retraction statement and the order made thereon before making the order of detention. It has been contended that the Enforcement Department in course of search of the house of detenu on August 25, 1987 attached bank drafts and cheques, bank pass books of State Bank of India, Kandivali Branch, New India Co operative Bank and Bank of Baroda, Dahisar, loose sheets bunched together and marked `C ' containing pages 1 to 44 and seized under panchnama but did not place before the detaining authority and if placed copies of those documents were not given to the detenu. It has been submitted that the failure to supply these documents infringed his fundamental right to make an effective representation and so the impugned order is required to be quashed. In reply to this submission the detaining authority filed a return stating that all documents mentioned in panchnama were placed before him. But only relevant and vital documents were taken into consideration for reaching subjective satisfaction. These documents have been referred to in the grounds of detention and copies of all the said documents have been furnished to the detenu. It has been strenuously contended on behalf of the appellant that Bank pass books and some pages out of 1 to 44 of the loose sheets bunched together and referred to in the Panchnama were not given to him and so he could not make an effective representation. This has infringed his right. In support of his sub mission the decision of this Court in Ashok Kumar vs Union of India and Ors., [ ; (to which one of us is a party) has been cited at the bar. There is no dispute that all the documents which were considered by the detaining authority in reaching his subjective satisfaction and referred to in the grounds of detention have been furnished to the detenu. It is not necessary to furnish copies of all the documents including the bank pass books which are not material and relevant for reaching the subjective satisfaction of the detaining authority merely because they were mentioned in the panchnama. Moreover, no application had been made before the detaining authority for giving the detenu the copies of the bank pass books necessary for making an effective representation against the order of detention. In Ashok Kumar 's case (supra) wherein this Court held that the order of detention had been vitiated due to non supply of bank pass books of the detenu and his wife seized in course of search of some houses wherefrom foreign currency as well PG NO 1037 as primary gold with foreign makings were recovered, as it was held that these documents were vital and material documents. The detenu in that case made an application for furnishing him the bank pass books in order to enable him to make an effective representation against the order of detention stating that the houses from which the alleged foreign currency as well as primary gold with foreign markings had been recovered did not belong to or owned by the detenu. In that background this Court held that non supply of the bank pass books infringed the detenu 's right to make an effective representation. In the instant case as we have said hereinbefore that the bank pass books are not vital and material documents in reaching subjective satisfaction of the detaining authority and as such the failure to furnish the bank pass books to the detenu has not infringed any right of the appellant and the order of detention cannot be questioned as illegal or vitiated on that score. No other points have been urged before us. For the reasons aforesaid we dismiss the appeal. There will be no order as to costs. R.S.S. Appeal dismissed .

The house of the appellant detenu was searched and currency notes, bank drafts, bank pass books and loose sheets seized. The detenu 's statement was recorded and he was arrested. Iater, he made an application retracting his statement and the Magistrate made an order thereon: "Taken on record". He was subsequently released on bail with a condition that he would attend Enforcement Department office every day. On his moving another application, the condition was varied. Thereafter, an order of detention was made by respondent No. 1 against the appellant under section 3 of the . The detenu thereupon filed a writ in the High Court challenging the order, which was dismissed. Before this Court, it was contended on behalf of the detenu that (i) his application for variation of the condition of bail and the order thereon as well as his application retracting his statement and the order thereon were not placed before the Detaining Authority, and non consideration of these vital documents vitiated the detention order; and (ii) copies of bank statements and loose sheets were not supplied to the detenu and this infringed his right to make an effective representation. Dismissing the appeal, it was, HELD: 1. The application for variation of condition of bail and the order passed thereon were not material or relevant documents and failure to produce the same before PG NO 1031 PG NO 1032 the Detaining Authority before arriving at his subjective satisfaction had not vitiated the detention order. [1035A] Asha Devi wife of Gopal Sherwal Mehta (detenu) vs Shiveraj, Addl. Chief Secretary to the Government of Gujarat Arvindbhai Purshottambhai Patel y. R.O. Iyer and Ors., Writ Petition No. 1304 of 1987 dated 25.2.1988, Bombay High Court, distinguished. Though the detenu 's application retracting his statement and the Magistrate 's order thereon was not placed before the Detaining Authority, his retraction letter and the reply of the Directorate of Enforcement had been placed before the Detaining Authority, and as such the Authority knew about these facts. [1035G; 1036A] 3. There was no dispute that all the documents which were considered by the Detaining Authority in reaching his subjective satisfaction and referred to in the grounds of detention had been furnished to the detenu. It was not necessary to furnish copies of all the documents including the bank pass books which were not material and relevant for reaching the subjective satisfaction of the detaining authority merely because they were mentioned in the panchnama. 11036F G] 4. The bank pass books were not vital and material documents in reaching subjective satisfaction of the detaining authority and as such the failure to furnish the bank pass books to the detenu had not infringed any right of the appellant and the order of detention could not be questioned as illegal or vitiated on that account. [1037B C] Ashok Kumar vs Union of India, [ 198X] ; , referred to.

Appeal No. 1792 of 1971. Appeal from the Judgment and Order dated the 31st March, 1970 of the Gujarat High Court in Special Civil Application No. 545/66. R.H. Dhebar, S.K. Dholakia and A.C. Bhatia for the appel lant. R.M. Mehta and Girish Chandra, for Respondent. 94 The Judgment of the Court was delivered by KHANNA, J. This appeal on certificate is against the judgment of Gujarat High Court dismissing petition under article 226 of the Constitution of India filed by the appel lant for a writ of certiorari or other appropriate writ to quash two notices issued by the respondent to the appellant under section 148 of the Income tax Act, 1961 (hereinafter referred to as the Act of 1961). The matter relates to the assessment years 1957 58 and 1959 60. The appellant is a public limited company which carries on the business of manufacture of pottery and sani tary wares at Morvi and other places in the State of Guja rat. In respect of the assessment year 1957 58, the corre sponding accounting year for which ended on July 31, 1966, the appellant filed its return under the Indian Income tax Act, 1922 (hereinafter referred to as the Act of 1922). The predecessor in interest of the responded by assessment order dated April 16, 1959 assessed the total income of the appel lant at Rs. 4,60,372. In computing the said income the Income tax Officer allowed depreciations amounting to Rs. 5,05,487. For the assessment year 1959 60 the appellant like wise filed return. Assessment order in respect of that year was made on March 30, 1961 and the income of the appel lant was assessed at Rs. 11,04,650 after allowing depreciation of Rs. 3,57,926. On October 5, 1965 a letter was addressed on behalf of the respondent to the appellant stating that there had been a mistake in the calculation of the depreciation allowance in respect of certain items of the capital assets of the appellant for the period covered by the assessment years 1955 56 to 1962 63. As a result of the mistake, it was stated, a sum of Rs. 2,39,723 had been allowed as deprecia tion allowance in excess of the permissible limit. Enclosed with the letter was a chart showing excess depreciation allegedly allowed during the above mentioned period. The excess amounts of depreciation for the years 1957 58 and 1959 60 were mentioned in the chart to be Rs. 37,869 and Rs. 26,945 respectively. The appellant company was asked if it had any objection to the rectification of the mistake, the above letter was followed by another letter wherein the respondent wrote to the appellant that "the mistake in depriciation arose because the initial depriciation was not taken into account in finding out whether the total depreciation allowed exceeded the original cost". On Febru ary 2, 1966 the Income tax Officer addressed 'another letter to the appellant stating that for the assessment years 1957 58 and 1959 60 the income of the appellant had escaped assessment for failure of the appellant to disclose all material facts within the meaning of section 147(a) of the Act of 1961. The appellant in reply stated that depre ciation calculation sheets had been worked by the income tax authorities and there was no failure on the part of the appellant to disclose all facts. The impugned notices were thereafter issued on March 4, 1966 by the Incometax Officer to the appellant stating that he had reason to believe that income of the appellant chargeable to tax for the assessment years in question had escaped assessment within the meaning of section 147 of the Act of 1961. The Income tax Officer accordingly stated that he proposed to recompute and reas sess the income/loss/depreciation 95 allowance for the aforesaid years. The appellant was called upon to furnish returns in the prescribed form within 30 days from the date of the service of the notices. It was also mentioned that the notices were being issued after obtaining the necessary satisfaction of the Commissioner of Income tax. The appellant thereafter filed writ petition in the High Court on April 29, 1966. According to the case of the appellant, there was no omission or failure on its part to disclose fully and truly all material facts necessary for the assessment. All material facts, it was stated, regard ing the acquisition of various capital assets from time to time were on the record of the department. The fact that initial depreciation on the new assets had been allowed was also on the record of the department. If there was any oversight on the part of the Income tax Officer, the appel lant, it was claimed, could not be held responsible for that. The petition was resisted by the respondent and the affidavit of Shri N.M. Baxi, Income tax Officer was filed in opposition to the petition. According to that affidavit, the appellant did not disclose in the return that initial depreciation in respect of certain items of capital assets had been allowed in the past and that the same should be taken into account while calculating the depriciation allow able for the assessment years in question. The High Court found that the first requirement of section 147(a) of the Act of 1961 was satisfied inasmuch as the Income tax Officer had reason to believe that the income of the appellant for the two assessment years in question had escaped assessment. The mistake arose because of the fact that the initial depreciation allowance which had been allowed to the appellant in respect of some of the items of the capital assets was not taken into account while comput ing the depreciation allowance during the relevant years. As a result of that, it was found that the depreciation allowance during the various years, including the initial depreciation, exceeded the original cost of those items of the capital assets to the appellant. Dealing with the question as to whether there was omission or failure on the part of the appellant to disclose truly and fully all mate rial facts, it was observed that the appellant was bound to disclose the fact that initial depreciation had been allowed in respect of the items of capital assets in question during the previous years. The appellant as such .was held to have failed to disclose all material facts. The plea of the appellant that all the material facts were already on the record of the department, in the opinion of the High Court, did not make material difference. In result, the petition was dismissed. Before dealing with the contentions advanced in appeal, it may be apposite to refer to the relevant provisions. According to section 10 of the Act of 1922, the tax shall be payable by an assessee under the head "Profits and gains of business profession or vocation" in respect of the profit or gains of any business, profession or vocation carried on by him. Such profits or gains shall be computed after making a number of allowances. Those allowances include those 96 allowed in respect of depreciation, as mentioned in clauses (vi) and (vi a) of sub section (2), the material part of which at the relevant time read as under: (vi) in respect of depreciation of such buildings, machinery plant or furniture being the property of the assessee, a sum equivalent . to such percentage on the written down value thereof as may in any case or class of cases be prescribed, and where the buildings have been newly erected or the machinery or plant being new, not being machinery or plant entitled to the development rebate under clause (vi b), has been installed, after the 31st day of March, 1945, and before the 1st day of April, 1956, a fur ther sum (which shall however not be deductible in determining the written down value for the purposes of this clause) in respect of the year of erection or installation equivalent, (a) in the case of buildings the erection of which is begun and completed between the st day of April 1946 and the 31st day of March 1956 (both dates inclusive), to fifteen per cent, of the cost thereof to the assessee; (b) in the case of other buildings, to ten per cent of the cost thereof to the assessee; (c) in the case of machinery or plant, to twenty per cent, of the cost thereof to the assessee; Provided that (a). . . . (b). . . . (c) the aggregate of all allowances in respect of depreciation made under this clause and clause (vi a) or under any Act repealed hereby, or under the Indian Income tax Act, 1886 (II of 1886), shall, in no case, exceed the original cost to the assessee of the buildings, machinery, plant or furniture, as the case may be; (vi a) in respect of depreciation of buildings newly erected, or of machinery or plant being new which has been installed, after the 31st day of March, 1948, a further sum (which shall be deductible in determining the written down value) equal to the amount admissible under clause (vi) (exclusive of the extra allowance for double or multiple shift working of the machinery or plant and the initial depreciation allowance admissible under that clause for the first year of erection of the building or the installation of the machinery or plant) in not more than five successive assessments for the financial years next following the previous year in which such buildings are erected and such machinery and plant installed and falling within the period commencing on the 1st day of April, 1949, and ending on the 31st day of March, 1959," 97 It is apparent from the above provisions that depreciation of three distinct kinds could be allowed in respect of buildings, machinery and plant. The first category was of ordinary depreciation equivalent to such percentage on the written down value thereof as may be prescribed. The second category was of depreciation of buildings, newly erected, or new machinery or plant not being machinery or plant entitled to development rebate under clause (vi b) which has been installed after the 31st day of March 1945 and before the st day of April 1956 equivalent to such percentage if the cost thereof as is prescribed. Such initial depreciation was granted in the first year of the construction of the build ing or installation of the plant or machinery. This cate gory of depreciation was not deduction in determining the written down value for the purpose of clause (vi). The third category of depreciation was additional depreciation which was claimable for a period of five years in respect of buildings, newly erected, or new machinery or plant in stalled after the 31st day of March 1948 in terms of clause (via). The depreciation permissible under this category was deduction in determining the written down value. Clause (c) of the proviso to clause (vi) of sub section (2) of section 10, however, makes it clear that the aggre gate of all three categories of depreciation allowance was in no case to exceed the original cost to the assessee of the building, machinery or plant, as the case may be. The case of the respondent is that the amount of depre ciation allowed to the appellant in respect of certain items of capital assets for the two assessment years in question was so much that the aggregate of all allowances in respect of depreciation made under clauses (vi) and (vi a) of sub section (2) of section 10 of the Act of 1922 exceeded the original cost to the appellant of those items of the capital assets. There was thus a violation of the provisions of clause (c) of the proviso to section 10 (2)(vi) of the Act. The above mistake, it is stated, occurred because the initial depreciation which had been allowed in respect of those items of the capital assets was not taken into account in computing the depreciation regarding those items in the two assessment years in question. The present is, therefore, a case, according to the respondent, of income escaping assessment under section 147 of the Act of 1961. Reliance in this connection is placed upon clause (d) of Explanation (1) to section 147 of the Act of 1961, according to which it would be a case of income escaping assessment where excessive depreciation allowance is comput ed. The material part of section 147 of the Act of 1961 reads as under: 147. Income escaping assessment. If (a) the Income tax Officer has reason to believe that, by reason of the omission or failure on the part of an assessee to make a return under section 139 for any 8 1458SCI/76 98 assessment year to the Income tax Officer or to disclose fully and truly all material facts necessary for his assessment for that year, income chargeable to tax has escaped assessment for that year, or (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 assess ment year concerned (hereafter in section 148 to 153 referred to as the relevant assessment year) . " According to section 148 of the Act of 1961, before making the assessment, reassessment or recomputation under ' section 147, the Income tax Officer shall serve on the assessee a notice containing all or any of the requirements which may be included in a notice under sub section (2) of section 139; and the provisions of the Act shall, so for as may be, apply accordingly as if the notice were a notice issued under that sub section. The Income tax Officer has also, before issuing such notice, to record his reasons for doing so. Section 149 prescribes the time limit for the notice. The time limit in a case not falling under clause (ii) of sub section (1) of section 149, with which we are not concerned, shall be eight years from the end of the relevant assessment year. In case falling under clause (b) of section 147, however, the time limit for the notice is four years from the end of the relevant assessment year. Clause (a) of section 147 of the Act of 1961 corresponds to clause (a) of sub section (1) of section 34 of the Act of 1922. The language of clause (a) of section 147 read with sections 148 and 149 of the Act of 1961 as also the corre sponding provisions of the Act of 1922 makes it plain that two conditions have to be satisfied before an Income tax Officer acquires jurisdiction to issue notice under section 148 in respect of an assessment beyond the period of four years but within a period of eight years from the end of the relevant year, viz., (i) the Income tax Officer must have reason to believe that income chargeable to tax has escaped assessment, and (ii) he must have reason to believe that such income has escaped assessment by reason of the omission or failure on the part of the assessee (a) to make a return under section 139 for the assessment year to the Income tax Officer, or (b) to disclose fully and truly material facts necessary for his assessment for that year. Both these conditions must co exist to confer jurisdiction on the Income tax Officer. It is also imperative for the Income tax Officer to record his reasons before initiating pro ceedings as required by section 148(2). Another require ment is that before notice is issued after the expiry of four years from the end of the relevant assessment years, the Commissioner should be satisfied on the reasons recorded by the Income tax Officer that it is a fit case for the issue of such notice. The duty which is cast upon the asses see is to make a true and full disclosure of the primary facts at the time of the original assessment. , 99 Production before the Income tax Officer, of the account books or other evidence from which material evidence could with due diligence have been discovered by the Income tax Officer will not necessarily amount to disclosure contem plated by law. The duty of the assessee in any case does not extend beyond making a true and full disclosure of primary facts. Once he has done that axis duty ends. It is for the Income tax Officer to draw the correct inference from the primary facts. It is no responsibility of the assessee to advise the Income tax Officer with regard to the inference which he should draw from the primary facts. If an Income tax Officer draws an inference which appears subsequently to be erroneous, mere change of opinion with regard to that inference would not justify initiation of action for re opening assessment [see Income tax Officer vs Lakhmani Mewal Das(1)]. The words "omission or failure to disclose fully and truly all material facts necessary for his assessment for that year" postulate a duty on the assessee to disclose fully and truly all material facts necessary for his assess ment. What facts are material and necessary for assessment will differ from case to case. In every assessment proceed ing, the assessing authority will, for the purpose of com puting or determining the proper tax due from an assessee, require to know all the facts which help him coming to the correct conclusion. From the primary facts in his posses sion, whether on disclosure by the assessee,or discovered by him on the basis of the facts disclosed, or otherwise the assessing authority has to draw inference as regards certain other facts; and ultimately from the primary facts and the further facts inferred from them, the authority has to draw the proper legal inferences, and ascertain on a correct interpretation of the taxing enactment, the proper tax leviable see Calcutta Discount Co. vs Income tax Offi cer(2)] as further observed in that case: "Does the duty, however, extend beyond the full and truthful disclosure of all primary facts ? In our opinion, the answer to this question must be in the negative. Once all the primary facts are before the assessing authority, he requires no further assistance by way of disclosure. It is for him to decide what inferences of facts can be reasonably drawn and what legal inferences have ultimately to be drawn. It is not for somebody else far less the assessee to tell the assessing authority what inferences, whether of facts or law, should be drawn. Indeed, when it is remem bered that people differ as regards what inferences should be drawn from given facts, it will be meaningless to demand that the assessee must disclose what inferences whether of facts or law he would draw from the ' primary facts. " Keeping in view the principles enunciated above, we may deal with the contention advanced on behalf of the appel lant that the present is not a case in which action could be taken under section 147(a) of the Act of 1961. This contention has been controverted (1) (2) 100 by the learned counsel for the respondent, who has canvassed for the correctness of the view taken by the High Court in the judgment under appeal. It would appear from what has been ' discussed above that one of the essential requisites for proceeding under clause (a) of section 147of the Act of 1961 is that the income chargeable to tax should escape assessment because of the omission or failure on the part of the assessee to dis close fully and truly all material facts necessary for his assessment. The present is not a case where the assessee had omitted or failed to file the return. Question then arises as to what has been omission or failure on the part of the assessee to make a full and true disclosure. There is nothing before us to show that in the return filed by the assessee appellant, the particulars given were not cor rect. Form C under rule 19 of the Indian Income tax Rules, 1922 at the relevant time gives the form of return which had to be filed by the companies. Part V of that form deals with depreciation. The said part requires a number of columns to be filled in by the. assessee. It has not been suggested that any of the information furnished of any of the particulars given in those columns by the appellant company were factually incorrect. Nor is it the case of the revenue that the appellant failed to. furnish the particu lars required to be inserted in those columns. Indeed, the copy of the return has not been filed and consequently no argument on that score could be or has been addressed before us. Part V of the form no doubt requires the assessee to state the written down value in column No. (2). Such writ ten down value had to be specified without taking into account the initial depreciation because such depreciation in terms of clause (vi) of section 10(2) of the Act of 1922 could not be deducted in determining the written down value for the purpose of that clause. The case of the appellant is that in determining the amount of depreciation at the time of the original assessment for the two assessment years in question, the Income tax Officer relied upon the written down value of the various capital assets as obtaining in the records of the department. This stand has not been contro verted. When an income tax officer relies upon his own records for determining the amount of depreciation and makes a mistake in doing so, we fail to understand as to how responsibility for that mistake can be ascribed to an omission or failure on the part of the assessee. It also cannot be disputed that initial depreciation in respect of items of capital assets in the shape of new machinery, plant and building installed or erected after the 31st day of March 1945 and before the 1st day of April 1956 is normally claimed and allowed. It seems that the Income tax Officer in working 'the figures of depreciation for certain items of capital assets lost sight of the fact that the aggregate of the depreciation, including the initial depreciation, al lowed under different heads could not exceed the original cost to the assessee of those items of capital assets. The appellant cannot be held liable because of this remissness on the part of the Income tax officer in not applying the law contained in clause (c) of the proviso to section 10(2)(vi) of the Act of 1922. As observed by Shah J. in Commissioner of Income tax vs Bhanji Lavji,(1) section 34(1)(a) of the Act of 1922 (corresponding to section 147 '(a) (1)79 I,T.R. 582. S.C. 101 of the Act of 1961) does not cast a duty upon the assessee to instruct the Income tax Officer on questions of law. It may also be mentioned that so far as the assessment for the assessment year 1957 58 is concerned, the assess ment order was once rectified and at another time revised. Despite such rectification and revision, the above mistake in the calculation of the depreciation remained undetected. It was only in October 1965 that the Income tax Officer realised that higher. amount of depreciation had been al lowed to the appellant than was actually due. A letter to that effect was consequently sent to the assessee on Octo ber 5, 1965. It was, however, nowhere mentioned in that letter that the higher amount of depreciation had been allowed and the income as such had escaped assessment because of the omission or failure on the part of the asses see to disclose truly and fully all material facts. Refer ence to such omission or failure came only in a subsequent communication. The submission made on behalf of the appel lant is not without force that reference was made to asses see 's omission or failure to disclose truly and fully all material facts because it was realised that after the expiry of four years from the end of the relevant assessment year, no action for reopening of assessment could be taken on the basis of detection of mistake alone unless there was also an allegation that the income had escaped assessment because of the omission or failure of the appellant to disclose fully and truly material facts. Looking to a11 the facts, we are of the opinion that it cannot be said that the excess depre ciation was allowed to the appellant company and its income as such escaped assessment because of its omission or fail ure to disclose fully and truly all material facts. It has been said that the taxes are the price that we pay for civilization. If so, it is essential that those who are entrusted with the task of calculating and realising that price should familiarise themselves with the relevant provisions and become well versed with the law on the sub ject. Any remissness on their part can only be at the cost of the national exchequer and must necessarily result in loss of revenue. At the same time, we have to bear in mind that the policy of law is that there must be a point of finality in all legal proceedings, that state issues should not be reactivated beyond a particular stage and that lapse of time must induce repose in and set at rest judicial and quasi judicial controversies as it must in other spheres of human activity. So far as income tax assessment orders are concerned, they cannot be reopened on the scope of income escaping assessment under section 147 of the Act of 1961 after the expiry of four years from the end of the assess ment year unless there be omission or failure on the part of the assessee to disclose fully and truly all material facts necessary for the assessment. As already mentioned, 'this cannot be said in the present case. The appeal is conse quently allowed; the judgment of the High Court is set aside and the impugned notices are quashed. The parties in the circumstances shall bear their own costs throughout. P.H.P. Appeal aIlowed.

The appellant a Public Limited Company filed its Income Tax Return relating to the assessment years 1957 58 and 1959 60 under the Income Tax Act, 1922. The Income Tax Officer passed assessment orders on 16 4 1959 and on 30 3 1961 respectively in respect of the two years. Certain depreciation was allowed by the Income Tax Officer for both the years. On 5 10 1965. the Income Tax Officer addressed a letter to the appellant stating that there had been a mistake in the calculation of the depreciation allowance. The appellant was asked by that letter if it had any objec tion to. the rectification of the mistake in the calculation of the depreciation amounts. for the above mentioned two years. On 2nd February, 1966, the Income Tax Officer ad dressed a letter under section 147(a) of the Income Tax Act, 1961 alleging that the income of the appellant had escaped assessment for failure of the appellant to disclose all materials facts. The appellant in his reply stated that the depreciation was calculated by the Income Tax authorities and there was no failure on the part of the appellant in disclosing all the facts. Thereafter, the Income Tax Offi cer issued the notices on 4 3 1966 stating that he had reasons to believe that the income of the appellant charge able to tax for the assessment years in question had escaped assessment within the to meaning of section 147 of the 1961 Act. The appellant was called upon to furnish fresh return. The appellant challenged the said notices by filing a Writ Petition in the High Court. According to the appellant there was no omission or failure on its part to disclose fully and truly all material facts necessary for the assess ment; that all material facts were placed before the assess ing authority; and that the fact that initial depreciation on the new assets had been allowed was also on the record of the department. It was further contended that if there was any oversight on the part of the Income Tax Officer the appellant could not be held responsible. The respondent filed an affidavit in the High Court contending that the appellant did not disclose in the return that initially depreciation in respect of certain items of capital assets had been allowed in the past and that the same should be taken into account while calculating the depreciation allow able for the assessment years in question. The High Court dismissed the Writ Petition on the ground that there was an omission or failure on the part of the appellant to disclose truly and fully the fact that the initial depreciation had been allowed in respect of items of capital assets in ques tion during the previous years. Under section 10 of the 1922 Act an assessee is liable to pay tax under the head "Profits and Gains of Business, Profession or Vocation, carried on by him". Such profits or gains shall be computed after making a number of allowances. Those allowances included the allowances provided by section 10(2)(vi) which deals with depreciation under section 147(a) of the Income Tax Act, 1961. if the Income Tax Officer has reason to believe that the reason of the omission or failure on the part of the assessee to disclose fully and truly all material facts necessary for his assessment, income charge able to tax has escaped assessment for that year he may subject to the provisions of sections 148 to 151 assess or reassess such income or recompute the loss or the deprecia tion allow 93 ance as the case may be. According to section 148 of 1961 Act before making the assessment, reassessment, or recompu tation under section 147, the income Tax Officer shall serve on the assessee a notice containing all or any of the re quirements which may be included in a notice under section 149(1). The Income Tax Officer has also before issuing such notice to record his reasons for doing so. Section 149 prescribes a time limit for the notice. The time limit in respect of section 147(a) is 8 years. Allowing the appeal, HELD: 1. Two conditions have to be satisfied before an Income Tax Officer acquires jurisdiction to issue notice under section 148 beyond the period of 4 years but within the period of 8 years: (i) The Income Tax Officer must have reason to believe that income chargeable to tax has escaped assessment; (ii) He must have reason to believe that such income has escaped assessment by reason of the omission or failure on the part of the assessee to disclose fully and truly material facts necessary for his assessment for that year. The duty which is cast upon the assessee is to make a true and full disclosure of the primary facts at the time of the original assessment. The duty of the assessee in any ease does not extend beyond making a true and full disclosure of primary facts. Once he has done that his duty ends. It is for the Income Tax Officer to draw the correct inference from the primary facts. It is no responsibility of the assessee to advise the Income Tax Officer with regard to the inference which he should draw from the primary facts. If an Income Tax Officer draws an inference which appears subsequently to be erroneous mere change of opinion with regard to that inference would not justify initiation of action for reopening assessment. [98 E G, H, 99 A B] Income Tax Officer vs Lakhmani Mewal Dass, followed. What facts are material and necessary for assessment will differ from case to case. Calcutta Discount Co. vs Income Tax Officer, , followed. The Income Tax return has to be filled in form, No. C under rule 19 of the Income Tax Rules, 1922. Part V of that form deals with depreciation. The said part requires a number of columns to be filled in by the assessee. It has not been suggested that any of the information furnished or any of the particulars given in those columns by the appellant Company were factually incorrect. When Income Tax Officer relies upon his own records for determining the amount of depreciation 'and makes. a mistake in doing so, the respon sibility for the mistake cannot be ascribed to an omission or failure on the part of the assessee. [99 D 100 B D, E F] Commission of Income Tax vs Bhanji Lavli, fol lowed. (Taxes are the price that is paid for civilisation. It is essential that those who are entrusted with the task of calculating and realising that price should familiarise themselves with the relevant provisions and become well versed with the law on the subject. Any remissness on their part can only be at the cost of the national exchequer and must necessarily result in loss of revenue. At the same time, it has to be borne in mind that the policy of law is that there must be a point of finality in all legal proceed ings).

: Special Leave Petition (Criminal) No. 2636 of 1979. From the Judgment and Order dated 25 4 1979 of the Bombay High Court in Criminal Appeal No. 822/77. Pramod Swarup (Amicus Curiae) for the Petitioner. H. R. Khanna and M. N. Shroff for the Respondent. The Judgment of the Court was delivered by KRISHNA IYER, J. Shri Pramod Swarup appearing as amicus curiae has presented the case of the accused as effectively as the record permits. Indeed, he has gone to the extent of pressing into service points which do not appear to us to have any force. Moreover, he has tried to persuade us to believe that a dying declaration made by the lady who was burnt to death by the husband accused that is the charge on which the trial court and the High Court have found the petitioner guilty is exonerative of the accused husband and does not implicate him as the Court has construed. The declarant as she was dying was 1210 conscious enough to make a statement and in one of the several statements she made, it would appear, she said when her husband was being beaten up that even though she had been burnt, her husband should not be beaten. This is a sentiment too touching for tears and stems from the values of the culture of the Indian womanhood. A wife when she has been set fire to by her husband, true to her tradition, does not want her husband to be assaulted brutally. It is this sentiment which prompted this dying tragic woman to say that even if she was dying having been burnt, her husband should not be beaten. We are unable to appreciate how this statement can be converted into one exculpative of the accused. Anyway, we are mentioning these facts only because Shri Pramod Swarup contended that they were weighty circumstances sufficient to cancel the conviction. Wife burning tragedies are becoming too frequent for the country to be complacent. Police sensitisation mechanisms which will prevent the commission of such crimes must be set up if these horrendous crimes are to be avoided. Likewise, special provisions facilitating easier proof of such special class of murders on establishing certain basic facts must be provided for by appropriate legislation. Law must rise to the challenge of shocking criminology, especially when helpless women are the victims and the crime is committed in the secrecy of the husband 's home. We hope the State 's concern for the weaker sections of the community will be activised into appropriate machinery and procedure. We dismiss the special leave petition. S.R. Petition dismissed.

Dismissing the special leave petition, the Court ^ HELD: The statement by the dying tragic woman that her husband should not be beaten, even though she was dying having been burnt, cannot be converted into one exculpative of the accused. This is a sentiment too touching for tears and stems from the values of the culture of the Indian womanhood. [1210A B] Observation: Police sensitisation mechanisms which will prevent commission of crimes like wife burning must be set up if these horrendous crimes are to be avoided. Likewise, special provisions facilitating easier proof of such special class of murders on establishing certain basic facts must be provided for by appropriate legislation. Law must rise to the challenge of shocking criminology, especially when helpless women are the victims and the crime is committed in the secrecy of the husband 's home. [1210C E]

Civil Appeal No. 1935 (NL) of 1974. From the Award dated 8.5.1974 of the Ninth Industrial Tribunal of West Bengal, Durgapur in Case No. X 4 of 1973. Dr. Shankar Gkosh and D.N. Gupta for the Appellants. S.K. Nandy for the Respondents. The Judgment of the Court was delivered by BALAKRISHNA ERADI, J. This appeal by Special Leave has been preferred against the Award dated May 8, 1974 made by the Ninth Industrial Tribunal of West Bengal, Durgapur in Case No. X 4 of 1973 on its file. The appellants are two companies incorporated 187 under the Indian Companies Act, 1913 having their registered office in Calcutta. Both the appellants are engaged in the business of generation, transmission, distribution and sale of electricity in certain areas of Bengal and Bihar under licences granted by the concerned Governments. Appellant No. 1 has a power station at Dishergarh and Appellant No. 2 has its power station at Sibpore. In connection with their aforesaid business the two appellants were having at the relevant time 400 and 250 workmen respectively employed under them. For the years 1965 66 to 1970 71 (inclusive) bonus was paid to the workmen on the basis of agreements entered into each year under Section 34(3) of the (hereinafter referred to as the 'Act '). Concerning the bonus payable for the year 1971 72, a dispute was raised by the workmen of the two companies and it was referred to conciliation under Section 12(1) of the . The contention of the workmen before the Conciliation officer was that they were entitled to bonus equivalent to three months ' basicwages as on March 31, 1972 as customary bonus or in any event as bonus payable under the provisions of the Act. The appellant companies, on the other hand, contended that the workmen were entitled to only minimum bonus as provided under the Act on a computation being made in the manner laid in the said Act. The said dispute was ultimately settled before the Conciliation officer inter alia on the following terms: "(1) Subject to usual adjustments made in 1969 70 and 1970 71, each eligible workmen will be paid an amount equal to three months ' basic wages as on 31.3.1970 . (2) A sum of Rs.20,000 will be distributed equally among all workmen who were on the rolls on 15.8.1972 and have worked for at least 30 days. This will be 'Silver Jubilee Year ' payment. (3) The demand of the Union for bonus this year will be referred to as Tribunal for adjudication. (4) The payment should be made by 12.10.1971 Eligible workmen under terms(1) of this settlement (a) Permanent and probationers. Rest of workmen will be paid bonus under the . " 188 Although the said settlement was an agreement under section 34(3) of the Act since under its very terms as incorporated in clause (3), the parties had stipulated for a reference of the question for adjudication by a Tribunal. The issue was accordingly referred by the Government of West Bengal for adjudication to the Ninth Industrial Tribunal of West Bengal by an order of reference dated January 15, 1973. In the written statement filed by the workmen before the Ninth Industrial Tribunal they claimed three months ' basic wages as on March 31, 1972 as customary bonus or in the alternative 20 per cent of the salary or wages as bonus payable under the Act. The appellants reiterated before the Tribunal the same contentions which they had put forward before the Conciliation officer. The Tribunal allowed the parties to adduce evidence. After a detailed discussion of the evidence produced before it, the Tribunal recorded a clear finding that the workmen had failed to make out the claim of customary bonus put forward by them and that the said plea had therefore to fail. It was further found by the Tribunal that the plea put forward by the appellant companies that there was no available surplus during the year in question and that only the minimum bonus was payable under the provisions of the Act had to be upheld. The Tribunal, therefore, held that the unions representing the workmen had failed to make out the case put forward by the workmen that the workmen were entitled to maximum bonus of 20 per cent as provided under the Act. After having recorded the aforesaid findings, the Tribunal, however, proceeded to accept the contention advanced before it by the Counsel appearing for the workmen that it was legally open to it to substitute for the agreement entered into between the parties before the Conciliation officer a new contract and pass an award on that basis, if such a step would be conducive to industrial peace. On this reasoning the Tribunal proceeded to observe: "In my opinion, there would not be material alteration in the financial liability of the companies in case the agreement was modified by substituting for the words that the workmen will be paid the amount equal to three months ' basic wages as on 31.3.1970 by the words an amount equal to basic wages as on 31.3.1972. I am, therefore, in agreement with this contention of the learned lawyer for the unions that the Tribunal should create a new contract and that is pass an award of three months ' basic wage as on 31.3.1972. This is in my opinion would be con 189 ducive to industrial peace and it would not violate any existing industrial law. " Accordingly, the Tribunal passed an award directing the appellant companies to pay to the workmen the balance amount by way of bonus as per the rates calculated by the Tribunal within a month from the date of publication of the award in the Calcutta Gazette. It is the legality of this award that is under challenge in this appeal. It has to be remembered that the claim of the workmen which the Tribunal was considering while making the aforesaid observations was one for Profit bonus only since the claim for customary bonus had been rejected by it. The rights and liabilities of the parties regarding Profit bonus were governed by the provisions of the Act which are exhaustive on the subject and the adjudication had to be conducted by the Tribunal strictly in accordance with those provisions See Sanghi Jeevraj Ghewar Chand and Ors. vs Secretary, Madras Chillies, Grains Kirana Merchants Workers ' Union and Anr., ; and Mumbai Kamgar Sabha, Bombay vs M/s Abdulbhai Faizullabhai & Ors., [1976] 3 S.C.R. 591. As already noticed, the Tribunal has categorically found on a consideration of the evidence adduced before it that there was no "available surplus" in respect of the two companies for the year in question on a computation made under Section S of the Act. The settlement entered into before the Conciliation officer constituted an agreement under Section 34(3) of the Act and but for the said agreement the liability of the appellants under the provisions of Act would have been only to pay minimum bonus under Section 10 of the Act. Since the parties were at variance on the question of existence of liability for payment of customary bonus in the establishments as well as on the question regarding the existence of available surplus, provision was made in clause (3) of the agreement for reference under the industrial adjudication. If the Tribunal found that the claim for payment of customary bonus was substantiated it could have passed an order in favour of the workmen for payment of such bonus. That claim had been negatived. The only question which remained for determination for the Tribunal was whether the claim of the workmen for payment of 20 per cent of the salary or wages as bonus payable under the Act was tenable or not. That depended essentially on the question of existence of available surplus and its quantum, if any surplus was available. In view of the finding recorded by the Tribunal accepting 190 the plea put forward by the appellant companies that the result of the working of the companies during the concerned year was a loss and there was no available surplus, the Tribunal could not have legally proceeded to make an award directing payment of bonus at any rate higher than the minimum bonus specified in Section 10 of the Act. As pointed out by this Court in The New Maneck Chowk Spinning and Weaving Company Ltd. Ahmedabad and others vs The Textile Labour Association, Ahmedabad, ; , while "it is certainly open to an industrial court in an appropriate case to impose new obligations on the parties before it or modify contracts in the interest of industrial peace or give awards which may have the effect of extending Agreement or making new one, but this power is conditioned by the subject matter with which it is dealing and also by the existing industrial law and it would not be open to it while dealing with a particular matter before it to overlook the industrial law relating to that matter as laid down by the legislature. " It is manifest that the impugned award made by the Tribunal is clearly inconsistent with the provisions of the which contemplate the imposition of an obligation for payment of only the minimum bonus where the employer has no allocable surplus in the concerned accounting year. However, in as much as the appellant companies had entered into the settlement before the Conciliation officer agreeing to pay bonus at a rate higher than the minimum bonus, the said settlement would constitute an agreement under Section 34 of the Act and the terms of the settlement will govern the liability for bonus for the year in question. It follows from the foregoing discussion that the impugned award passed by the Ninth Industrial Tribunal is not legally sustainable. The appeal is accordingly allowed and the Award of the Industrial Tribunal will stand set aside. The rights of the workmen for payment of bonus for the year in question will be governed by the terms of the agreement enterd into before the Conciliation officer on October 9. 1972. In view of the condition imposed by the order of this Court dated November 21, 1974 while granting Special Leave, the appellants are directed to pay the costs of the respondents in this appeal. M.L.A. Appeal allowed.

A dispute regarding bonus payable to the workmen respondents of the two companies appellants for the year 1971 72 was referred to conciliation under section 12(1) of the . The workmen contended before the Conciliation officer that they were entitled to bonus equivalent to three months ' basic wages as on 31st March, 1972 as customary bonus or in any event as bonus payable under the provisions of the Act. The appellant companies, on the other hand, argued that the workmen were entitled to only minimum bonus as provided under the Act. The said dispute was ultimately settled before the Conciliation officer on the terms: (a) that each eligible work man will be paid an amount equal to three months ' basic wages as on 31.3.1970; and (b) that the demand of the Union for bonus this year will be referred to a Tribunal for adjudication. Accordingly, the Government referred the dispute for adjudication to the ninth Industrial Tribunal of West Bengal. After a detailed discussion of the evidence produced before the Tribunal, it found (i) that the workmen had failed to make out the claim of customary bonus or that they were entitled to maximum bonus of 20 per cent as provided under the Act; and (ii) that there was no available surplus during the year in question and that only the minimum bonus was payable under the provisions of the Act. However, after having recorded the aforesaid findings, it proceeded to hold that it was legally open to it to substitute for the agreement entered into between the 185 parties before the Conciliation officer a new contract and pass an award on that basis, if such a step would be conducive to industrial peace. On this basis the Tribunal, held that there would not be material alteration in the financial liability of the companies in case the agreement was modified by substituting for the words "that the workmen will be paid the amount equal to three months ' basic wages as on 31.3.1970" by the words "an amount equal to basic wages as on 31.3.1372" and accordingly it passed an award in those terms. In appeal to the Supreme Court, the appellants companies challenged the legality of this award. Allowing the appeal, ^ HELD: 1. The impugned award passed by the Ninth Industrial Tribunal is not legally sustainable and has to be set aside. The rights of the workmen for payment of bonus for the year in question will be governed by the terms of the agreement entered into before the Conciliation officer on October 9, 1972. [190F] 2. The rights and liabilities of the parties regarding profit bonus are governed by the provisions of the payment of Bonus Act, 1965 which are exhaustive on the subject and the adjudication had to be conducted by the Tribunal strictly in accordance with those provisions. [189C D] In the instant case, the Tribunal has categorically found that there was no "available surplus" in respect of the two companies for the year in question on a computation made under section 5 of the Act. The settlement entered into before the Conciliation officer constituted an agreement under section 34(3) of the Act and but for the said agree ment, the liability of the appellants under the provisions of the Act would have been only to pay minimum bonus under section 10 of the Act. [189E F] Sanghi Jeevraj Chewar Chand and Ors. vs Secretary Madras Chillies, Grains Kirana Merchants Workers ' Union and Anr., [ ; and Mumbai Kamgar Sabha. Bombay vs M/s Abdulbhai Faizullabhai & Ors., [ ; referred to. It is certainly open to an Industrial Court in an appropriate case to impose new obligations on the parties before it or modify contracts in the interest of industrial peace or give awards which may have the effect 186 of extending the agreement or making new one, but this power is conditioned by the subject matter with which it is dealing and also by the existing industrial law and it would not be open to it while dealing with a particular matter before it to overlook the industrial law relating to that matter as laid down by the legislature. " [190B D] The New Maneck Chowk Spinning and Weaving Company Ltd. Ahmedabad and others vs The Textile Labour Association, Ahmedabad, ; relied upon. In the instant case, in view of the finding recorded by the Tribunal that the result of the working of the companies during the concerned year was a loss and there was no available surplus, the Tribunal could not have legally proceeded to make an award directing payment of bonus at any rate higher than the minimum bonus specified hl section 10 of the Act. Therefore, the impugned award made by the Tribunal is clearly inconsistent with the provisions of the Payment of Bonus Act which contemplate the imposition of an obligation for payment of only the minimum bonus where the employer has no allocable surplus in the concerned accounting year. However, inasmuch as the appellant companies had entered into the settlement before the Conciliation Officer agreeing to pay bonus at a rate higher than the minimum bonus, the said settlement would constitute an agreement under section 34 of the Act and the terms of the settlement will govern the liability for bonus for the year in question. [190D E]

Criminal Appeal No. 241 of 1982 From the Judgment and Order dated 14.9.81 of the Patna High Court in Crl. Revision No. 874/81. Dr. L.M. Singhvi, S.K. Sinha, S.K. Verma, A.M. Singhvi, section Singh, C. Mukhopadhya and R. Tyagi for the Appellants. Dr. Y.S. Chitale, F.S. Nanman, S.N. Kacker, Rajinder Singh, D. Goburdhan, D. Chandrachud, L.R. Singh, Gopal Singh, M.P. Jha, R.K. Jain, Ranjit Kumar and B.P. Singh for the Respondents. The following Judgments were delivered: BHAGWATI, CJ. This case has had a chequered history and it is necessary to state the facts in some detail in order to appreciate the questions which arise for determination before us. The principal actor in the drama in this case is Dr. Jagannath Misra, one time Chief Minister of the State of Bihar. The main controversy around which all questions revolve is whether the prosecution launched against Dr. Jagannath Misra at a time when he was not in power has been rightly allowed to be withdrawn by the Chief Judicial Magis trate or whether such withdrawal is invalid and must be set aside so that the prosecution can continue against Dr. Jagannath Misra. The fact situation out of which this case arises relates to the affairs of a cooperative Bank called the 'Patna Urban Cooperative Bank ' (hereinafter referred to as the 'Coopera tive Bank '). The Cooperative Bank was registered in May 1970 and it commenced its banking business with Nawal Kishore Sinha as its Chairman, K.P. Gupta as its Honorary Secretary, M.A. Hyderi as its Manager and A.K. Singh as a loan clerk. It was not seriously disputed that most of the members of the Cooperative Bank were closely associated with Nawal Kishore Sinha. The object of the Cooperative Bank was to help people financially to set up small industries and businesses and to assist people in ordinary circumstances to carry on their vocation or business. There was a sub Commit tee formed, called "Loan Sub Committee", consisting of Nawal Kishore Sinha, K.P. Gupta and one Purnendu Narain, an Advo cate, to attend to the work of sanctioning and granting of loans. The Chairman, i.e., Nawal Kishore Sinha, was, accord ing to the bye laws, the ultimate deciding authority in regard to all the functions of the Cooperative Bank and the Honorary Secre 724 tary i.e. K.P. Gupta along with the Chairman had to exercise supervisory control over all the activities of the Coopera tive Bank, while the Manager, i.e. M.A. Hyderi, was con cerned only with its :lay to day working. Dr. Jagannath Misra who was then a Member of the Legislative Council was closely associated with Nawal Kishore Sinha and he helped the Cooperative Bank and Nawal Kishore Sinha in diverse ways in connection with the affairs of the Cooperative Bank and also assisted in mobilisation of resources for the Coopera tive Bank. Sometime in 1974 separate audits into the func tioning of the Cooperative Bank were carried out by the Reserve Bank of India as well as the Cooperative Department of the State of Bihar for the years 1972 73 and 1973 74 and as a result of these audits, there came to light a large number of irregularities such as non maintenance of cash books in a proper manner and grant of overdraft facilities without current account as also illegal practices and acts of defalcation and malversation of funds of the Cooperative Bank. The audit reports disclosed that huge amounts running into lakhs of rupees, had been squandered away by giving loans to non members, giving loans even without applica tions, agreements or promissory notes, giving loans without hypothecation or security, giving short term loans instead of releasing cash from sale proceeds of hypothecated goods, giving loans to the same persons in different names and giving loans to fictitious persons and non existing firms or industries. There were instances where loans had been grant ed on the security of Gandhi Maidan and Patna Railway Sta tion. The audit team of the Reserve Bank in its Report came to the conclusion that Nawal Kishore Sinha and others were responsible for 'bad loans ' to the tune of Rs. 12 lakhs and misappropriation and embezzlement of funds to the extent of Rs.25 lakhs. On the basis of these audit reports, the Registrar Cooperative Societies, at the instance of the Reserve Bank, made an order on 10th July 1974 superseding the management of the Cooperative Bank, removing Naval Kishore Sinha and other Directors on the Board from their office as Chairman and Directors and appointing an officer of the Cooperative Department as Special Officer to look after the affairs of the Cooperative Bank. The Registrar, Cooperative Societies followed up this action by putting up a note dated 4th November 1974 to the Secretary, Cooperation pointing out that, according to the audit reports, prima facie charges of defalcations, embezzlement of funds, conspiracy etc. were made out against the officials of the Cooperative Bank and legal action should be taken against them after taking the opinion of the Public Prosecutor. The Secretary, Cooperation by his note dated 7th November 1974 sought the opinion of the Law Depart 725 ment in regard to the action to be taken as suggested in the note of the Registrar, Cooperative Societies. The Law De partment recorded its opinion in the relevant file on 18th November 1974 that a prima facie case of conspiracy and criminal breach of trust was made out against the loanees and the office bearers of the Cooperative Bank. On the basis of this opinion, a draft complaint was prepared on 16th December 1974 by the Asstt. Public Prosecutor, Patna for being filed in the court of the Chief Judicial Magistrate, Patna and on the same day, an office noting was made on the file suggesting that the advice of the Law Department on the draft complaint be obtained. This course of action was approved by the Secretary, Cooperation and the Minister for Cooperation also approved of it on1st January 1975 and it also received the approval of the then Chief Minister, Shri Abdul Ghafoor on 2nd January 1975. The file was then sent back to the Law Department and the Law Department again reiterated its earlier advice for launching the prosecution and on the file being received back on 17th January 1975, the Secretary Cooperation, endorsed the file on 21st January 1975 to the Additional Public Prosecutor, Shri Girish Narain Sinha, for necessary action, that is, to file the prosecu tion. Thus, by 21st January 1975 a firm decision was taken to launch a criminal prosecution against the loanees and the members of the Board of Directors of the Cooperative Bank including the Chairman Naval Kishore Sinha and a com plaint in that behalf duly approved by the Law Department and signed by Shri Jagdish Narain Verma, District Coopera tive Officer, Patna on 25th January 1975 was ready with the Addl. Public Prosecutor, for being filed in the court of the Chief Judicial Magistrate. But before the Additional Public prosecutor could file the complaint, Dr. Jagannath Misra who was then Minister incharge of Agriculture and Irrigation wrote a buff sheet note dated 24th January 1975 asking the Secretary Cooperation to send the concerned file along with the audit reports to him before instituting the criminal case. It may be pointed out that under the Notification dated 30th April 1974 issued under Article 166(3) of the Constitution read with Rule 5 of the Rules of Executive Business of the State of Bihar, the then Chief Minister Shri Abdul Ghafoor, was holding inter alia the portfolio of Law but, according to the affidavit of Shri Neelanand Singh dated 19th October 1982 filed on behalf of respondent No. 1 in this Court, Shri Abdul Ghafoor had, with a view to lessen his heavy burden, requested Dr. Jagannath Misra to look after the work of the Law Department. Since Dr. Jagan nath Misra asked for the concerned file, Shri Abdul Ghafoor, on a reference made to him directed on 27th January 1975 that the file may be sent to Dr. Jagannath Misra. The Secretary, Cooperation accordingly recalled the comp 726 laint and other papers from the Additional Public Prosecutor on 28th January 1975. The file was then placed before R.K. Srivastava, Minister of Cooperation and he made an endorse ment on the file on 31st January 1975 pointing out various instances of criminal conspiracy criminal breach of trust and misappropriation of public funds which had come to light against the Directors of the Cooperative Bank and sent the file to Dr. Jagannath Misra route to the Chief Minister since they wanted to see the file before the complaint was actually lodged. It does not appear from the record as to when the file was actually sent to Dr. Jagannath Misra but in any event the file was in the hands of Dr. Jagannath Misra on 24th February 1975. The file remained with Dr. Jagannath Misra for over two and a half months and no en dorsement was made by him on that file until the middle of May 1975 with the result that prosecution could not be filed against Naval Kishore Sinha and the other Directors. Mean while on 11th April 1975, Shri Abdul Ghafoor was thrown out and in his place Dr. Jagannath Misra became Chief Minister. Dr. Jagannath Misra made an Order in his own hand in Hindi in the file on 16th May 1975 regarding the action to be taken against Nawal Kishore Sinha and others and the English translation of this Order ran as follows: "Much time has passed. On perusal of the File it appears that there is no allegation of defalcation against the Chairman and the Members of the Board of the Bank. Stern action should be taken for realisation of loans from the loanees and if there are difficulties in realisation from the loanees surcharge pro ceedings should be initiated against the Board of Directors. The normal condition be resorted in the Bank after calling the Annual General Meeting and holding the election. Sd/ May 16, 1975 Jagan nath Misra In the margin opposite to this Order, the seal contain ing the despatch entry originally showed May 16, 1975 as the date on which the file was despatched from the Chief Minis ter 's ,secretariat to the Cooperative Department after Dr. Jagannath Misra had made the Order. It is obvious from the first part of the Order that Dr. Jagannath Misra did not want any criminal prosecution to be launched against Nawal Kishore Sinha and the other Members of the Board of the Cooperative Bank and that is why he observed that there was no allegation of defalcation against the Chairman and the Members of the 727 Board though that was not correct. The object of making this observation clearly was to pre empt the filing of any crimi nal prosecution against Nawal Kishore Sinha and the other members of the Board. The second part of the Order provided that if there was any difficulty in realisation of the loans from the loanees, surcharge proceedings should be initiated against the Chairman and other members of the Board and since the loans advanced by the Cooperative Bank were mostly in fictitious names and in any event it was impossible to recover them. It was clear that, on the basis of this part of the Order, surcharge proceedings would have to be adopted against the Chairman and other Directors of the Cooperative Bank. Now, according to the despatch entry as originally made, the file containing this Order must have left the office of Dr. Jagannath Misra on 16th May 1975, though the case of Dr. Jagannath Misra is that it never left his of fice. If the file left the office of Dr. Jagannath Misra on 16th May 1975, it does not appear from the record as to when i4 came back, because there is no endorsement or seal show ing inward receipt of the file by the Secretariat of Dr. Jagannath Misra. But whether the file remained in the office of Dr. Jagannath Misra as claimed by him or it left the office on 16th May 1975 and subsequently came back to the office, it is indisputable that Dr. Jagannath Misra passed another Order in his own hand on a piece of paper in Hindi under his signature and had it pasted over the earlier order dated 16th May 1975 so as to efface the same completely and this subsequent Order was ante dated to 14th May 1975. The date of despatch namely, 16th May 1975 in the despatch entry appearing in the margin was also altered to 14th May 1975 by over writing. The English translation of this second Order addressed to the Minister, Cooperation was in the following terms: "Please issue order for restoring the normal condition in the Bank after holding Annual General Meeting". Sd / May 14, 1975 Jagan nath Misra" The explanation given on behalf of Dr. Jagannath Misra was that, as Chief Minister, he had authority and power to revise or review his earlier order and that it is the usual practice prevailing at the Patna Secretariat that whenever any order passed earlier is sought to be revised or reviewed by the same officer or Minister, it is done by pasting it over by a piece of paper containing the revised order. But even with this explanation, the admitted position that emerges is that the first Order dated 16th May 1975 made by Dr. Jagannath Misra in 1 is own 728 handwriting in the file was obliterated by the second Order made by him subsequent to 16th May 1975 but ante dated to 14th May 1975 and the date 16th May 1975 in the despatch entry was also changed to 14th May 1975 by overwriting. The effect of this action on the part of Dr. Jagannath Misra was that even the direction to adopt surcharge proceedings against the Chairman and Board of Directors in default of realisation of the loans from the loanees, was wiped out and the only direction which remained was that normal condition in the Cooperative Bank should be restored by calling the Annual General Meeting and holding the election. Thus, not only no approval was given by Dr. Jagannath Misra to the filing of the prosecution against the Chairman and members of the Board of Directors but no direction was given even in regard to the adoption of surcharge proceedings against them. There can be no doubt that Dr. Jagannath Misra as Chief Minister had the authority and power to revise the earlier Order dated 16th May 1975 and he could have easily done sO, but instead, he ante dated the second Order to 14th May 1975 and pasted it over the earlier Order dated to 16th May 1975 so as to efface it altogether and also altered the date of the despatch entry to 14th May 1975. The contention was that this was deliberately done by Dr. Jagannath Misra with the fraudulent intent to override the effect of the earlier Order dated 16th May 1975 and protect Nawal Kishore Sinha from civil liability arising from initiation of sur charge proceedings. This contention was disputed on behalf of Dr. Jagannath Misra and it was said that this was an innocent act in accordance with the practice of the Patna secretariat and the ante dating was not mala fide but simply a result of bona fide error. This is a matter which would have to be gone into by the Court if the withdrawal of the prosecution is set aside and the prosecution is directed to be continued against Dr. Jagannath Misra. So far as the filing of the prosecution against Nawal Kishore Sinha and the other members of the Board of Direc tors was concerned, it appears that the Cooperative Depart ment wanted to go ahead with it and the Minister, Coopera tion accordingly put up a Note dated 28th June 1975 and sought directions from Dr. Jagannath Misra as to what should be the next course of action in the matter of filing of the complaint. Dr. Jagannath Misra in response to this query passed the following Order in the file on 30th June 1975: "Discussion has been held. There is no need to file the prosecution. " This clearly shows that Dr. Jagannath Misra did not want any prosecution to be filed against Nawal Kishore Sinha and others and wanted to protect Nawal Kishore Sinha against any such criminal prosecution. It appears that in July 1975 there were questions and call attention motions in the 729 Bihar Legislative Assembly and in the course of the proceed ings, the propriety of not filing prosecution against Nawal Kishore Sinha and others connected with the affairs of the Cooperative Bank, despite the advice of the Law Department, was discussed and the Speaker referred the matter to the Estimates Committee of the House. The next event which happened in chronological sequence was that the annual general meeting of the Cooperative Bank was held and the associates of Nawal Kishore Sinha were elected in November, 1975, the management of the Cooperative Bank was handed over to the elected directors. But, on 15th April, 1976 the Reserve Bank of India cancelled the banking licence of the Cooperative Bank and on 19th April, 1976 the Cooperative Bank was ordered to be liquidated and T. Nand Kumar, an IAS officer, was appointed liquidator of the Cooperative Bank. The Estimates Committee to which the matter had been referred by the Speaker submitted its report in June, 1976 recommending prosecution of Nawal Kishore Sinha and others and this led to a debate in the Bihar Legislative Assembly in July 1976, the upshot of which was that the Government was forced to agree to launch prosecution against the cul prits. Dr. Jagannath Misra accordingly passed an order on 4th August 1976 directing launching of prosecution against those involved in the sordid affairs of the Cooperative Bank but even there, he directed that the prosecution be launched against some of the office bearers and loanees including K.P. Gupta, M.A. Hyderi and A.K. Singh but not against Nawal Kishore Sinha. Thus, 23 criminal cases were filed against these office bearers and loanees but Nawal Kishore Sinha was excluded from being arraigned as an accused in these cases. This order made by Dr. Jagannath Misra affords the clearest indication that, even with all the furore which had arisen on account of non prosecution of Nawal Kishore Sinha and others. Dr. Jagannath Misra persisted in his attempt to shield Nawal Kishore Sinha from prosecution. T. Nand Kumar, liquidator of the Cooperative Bank however addressed a communication to the Registrar Cooperative Societies sug gesting that besides the other office bearers, Nawal Kishore Sinha also deserved to be prosecuted for the offences of embezzlement, forgery, cheating etc. but the matter was kept pending. for the report of the Superintendent of the Police (Cooperative Vigilance Cell). The Superintendent of Police (Cooperative Vigilance Cell) after collecting the necessary evidence got it examined by the Deputy Secretary, Law, and on the basis of the opinion given by the Law Department that a criminal case was fully made Out against Nawal Kishore Sinha. He proposed on the file on 8th October, 1976 that a 730 fresh criminal case as per draft first information report, should be filed against Nawal Kishore Sinha and he should also be made co accused in the previously instituted cases. This proposal was approved by the Deputy Inspector General (CID) and it was submitted to the Commissioner of Coopera tive Department for obtaining the approval of the Chief Minister, that is, Dr. Jagannath Misra. Since Dr. Jagannath Misra had earlier made an order restricting the filing of criminal cases against some of the office bearers and loa nees and excluded Nawal Kishore Sinha from the prosecution, the Superintendent of Police in charge of cooperative vigi lance cell categorically stated in his note that the draft first information report against Nawal Kishore Sinha had been vetted by the Deputy Secretary, Intelligence CID, as well as by Inspector General of Police. The Commissioner of Cooperative Department after examining the entire material carefully and obtaining clarifications on certain points put up a lengthy note on 15th January, 1977, to the Minister Cooperation in which he specifically placed the proposal of the Superintendent of Police (Cooperative Vigilance Cell) for launching first information report against Nawal Kishore Sinha for his approval and also suggested that the Hon 'ble Minister may obtain the approval of the Chief Minister. The Minister Cooperation in his turn endorsed the file on 20th January, 1977 to the Chief Minister for approval. The file was received in the secretariat of the Chief Minister on 30th March, 1977 and Dr. Jagannath Misra as Chief Minister instead of clearly and specifically approving the proposal or even indicating his mind either way, merely marked the file to 'I.G. of Police ' on 9th April, 1977. It is difficult to understand this endorsement made by Dr. Jagannath Misra because the draft first information report had already been vetted and approved by the Inspector General of Police and there was no point in referring the matter back to the Inspector General of Police. If Dr. Jagannath Misra was merely approving the action proposed to be taken he would have either made an endorsement of approval or put his signatures or initials without saying anything more but instead he marked the file to 'I.G. of Police '. There is considerable force in the submission made on bahalf of the appellant that the object of making this endorsement was merely to put off the matter. Soon thereafter however on 30th April, 1977 the Government of Dr. Jagannath Misra went out of power and President 's Rule was imposed in the State of Bihar. The file containing the proposal for prosecution of Nawal Kishore Sinha then went to the Advisor (Coopera tion) under the President 's Rule and he approved the propos al on 15th May, 1977 and the then Governor, Shri Jagannath Kaushal, gave his approval to the proposal on 16th May, 1977 with the result that a criminal case ultimately came to be filed against 731 Nawal Kishore Sinha on 30th May, 1977. It is obvious from this narration of facts that Dr. Jagannath Misra, whilst he was in power, made determined effort to protect Nawal Ki shore Sinha against any criminal prosecution even though the filing of criminal prosecution was advised by the Reserve Bank of India and the Cooperative Department, proposed by the investigating authorities, recommended by the Estimates Committee and strongly supported by the Law Department. But ultimately a criminal prosecution was launched against Nawal kishore Sinha after Dr. Jagannath Misra went out of power. Sometime in May, 1977 as a result of fresh elections to the State Legislature, a new Government came to power in the State of Bihar and at the instance of Shri Karpoori Thakur who became the Chief Minister in the new Government, an inquiry was directed into the allegations regarding irregularities in the affairs of the Cooperative Bank. The inquiry was entrusted to the then Secretary Shri D.N. Sahay. Meanwhile a Commission of Inquiry had already been institut ed by the State Government and Shri D.N. Sahay therefore addressed a communication dated 1st September, 1977 to the Special Secretary in regard to the charge relating to the affairs of the Cooperative Bank and he pointed out that since an inquiry had already been instituted, it may not be desirable to proceed with a vigilance inquiry. Shri Karpoori Thakur however directed that the vigilance inquiry might continue as the materials collected as a result of the vigilance inquiry could be made use of by the Commission of Inquiry. The vigilance inquiry was thereafter entrusted to Shri D.P. Ojha who was posted as Superintendent of Police, Vigilance, by Shri Karpoori Thakur and all the cases relat ing to the affairs of the Cooperative Bank were transferred to the vigilance department. M.A. Hyderi who was already an accused in the previously instituted cases was re arrested in connection with those cases and in the course of the fresh investigation started by the vigilance department, M.A. Hyderi made a second confessional statement on 24th January, 1978 which implicated Dr. Jagannath Misra which sought to support the case that Dr. Jagannath Misra had been helping Nawal Kishore Sinha by abusing his office and for making illegal gains for himself. It may be noted that M.A. Hyderi had earlier made a confessional statement on 3/4th November, 1976 in which he had not implicated Dr. Jagannath Misra but in the second confessional statement recorded on 24th January, 1978 he clearly and unequivocally implicated Dr. Jagannath Misra. On 28th January, 1978 A.K. Singh also made a confessional statement supporting the confessional statement of M.A. Hyderi. Immediately after recording these confessional statements Shri D.P. Ojha submitted his inquiry report 732 recommending institution of criminal cases against Dr. Jagannath Misra and others. This recommendation was support ed by the Deputy Inspector General of Police (Vigilance) as also by the inspector General of Police (Vigilance). The file was then referred to the Advocate General, Shri K.D. Chatterjee, and the recommendation to institute prosecution against Dr. Jagannath Misra and others was approved by the Advocate General who opined that there was sufficient mate rial for the prosecution of Dr. Jagannath Misra and others. The file was then placed before the Chief Minister, Karpoori Thakur, on 31st January, 1978 and it was approved by him on the same day and a direction was given to investigate the case against Dr. Jagannath Misra and others and to institute prosecution against them. The police in the vigilance de partment thereafter filed Vigilance P.S. Case No. 9(2)78 and carried out further investigation and ultimately as a result of such investigation, two charge sheets were filed against Dr. Jagannath Misra and others on 21st February, 1979. One, A.K. Datta, a senior advocate of the Patna High Court was appointed Special Public Prosecutor by the State Government on 26th February, 1979 to conduct these two vigilance cases against Dr. Jagannath Misra and others and on 21st November, 1979, the Chief Judicial Magistrate cum Special Judge, Patna took cognizance of these two cases. But before these two cases could proceed further there was a change of Government in the State of Bihar and Dr. Jagannath Misra once again became the Chief Minister in June, 1980. Dr. Jagannath Misra after coming back to power constituted a Cabinet subCommittee on 15th September, 1980 to consider the expediency of the withdrawal of the prosecution and on 20th February, 1981 the Cabinet sub Committee recommended that the cases against Dr. Jagannath Misra and others should be withdrawn. This recommendation of the Cabinet sub Committee was placed before the Cabinet presided over by Dr. Jagannath Misra and it was approved by the Cabinet on 24th February, 1981. On the same day on which the recommendation of the Cabinet sub Committee was approved, a decision was taken that the two cases against Dr. Jagannath Misra and others should be withdrawn and the State Government cancelled the panel of lawyers which had been constituted by the previous Government for conducting cases pertaining to the vigilance department and in its place constituted a new panel consist ing of four lawyers including one Lallan Prasad Sinha. The Secretary to the Government of Bihar thereafter addressed a letter dated 25th February, 1981 to the District Magistrate which was in the following terms: 733 " Government of Bihar Law (Justice) Department From: Shri Ambika Prasad Sinha Secretary to Government, Bihar, Patna To: The District Magistrate Patna. Patna, Dated 25th Feb. 1981. Subject: In connection with the withdrawal of Vigilance P.S. Case No. 9(2)78 and P.S. case No. 53(8)78. Sir, I am directed to say that the State Government have decided to withdraw from prosecution the above mentioned two criminal cases on the ground of inexpediency of prose cution for reasons of State and public policy. You are, therefore, requested to direct the public prosecutor to pray the Court after himself considering for the withdrawal of the above mentioned two cases for the above reasons under section 321 of the Code of Criminal Procedure. Please acknowledge receipt of the letter and also intimate this department about the result of the action taken. Yours faithfully, sd. Illegible Secretary to Govt. Patna. Memo No. MW 26/81, 1056 J. Patna, dated 25th February, 1981 Copy forwarded to Vigilance Depart ment for information. " 734 Shri Lallan Prasad Sinha thereupon filed an application in the Court of the Chief Judicial Magistrate on 16th Jane, 1981 praying for permission to withdraw from the prosecution of Dr. Jagannath Misra and others under Vigilance P.C. Case No. 9(2)78. There were four grounds stated in the applica tion for permission to withdraw from the prosecution and they may be stated as follows in the language of the appli cation itself: (1) Lack of prospect of successful prosecution in the light of evidence, (2) the implication of the persons as a result of political and personal vendetta, (3) inexpediency of the prosecution for the reasons of the State and public policy, and (4) the adverse effects that the continuation of the prosecution will bring on public inter est in the light of the changed situation. The application after setting out these grounds proceeded to elaborate them in the following words: " . . That I have therefore gone through the case diary and the relevant materials connected with the case and have come to the conclusion that in the circumstances prevail ing at the time of institution of the case and the investigation thereof, it appears that the case was instituted on the ground of political vendetta and only to defame the fair image of Dr. J.N. Mishra, who was then the leader of the opposition and one of the acknowledged leaders of the Congress party in the country. The prosecution was not launched in order to advance the interest of public justice. I crave leave to place materials in support of the above submission and conclusion at the time of moving this petition. That it is in public interest that the prosecutor which has no reasonable chance of success and has been launched as a result of political vendetta unconnected with the advancement of the cause of public justice should not proceed further. More so, as the same is directed against the head of the Executive in whom not only the electorate have put their faith and confidence but who has been elected 735 leader of the majority party in the legisla ture, both events have taken place after the institution of the case . " The application for withdrawal was opposed by Sheonandan Paswan, a member of the Bihar Legislative Assembly and its Deputy Speaker at the material time. The locus standi of Sheonandan Paswan to object to the application for withdraw al was challenged by Shri Lallan Prasad Sinha and this challange was upheld by the learned Chief Judicial Magis trate and it was held that Sheonandan Paswan had no locus standi to oppose the application for withdrawal. The learned Chief Judicial Magistrate then considered the application for withdrawal on merits and passed an order dated 28th JUne, 1981 in which, after reciting the rival contentions urged before him, held that "it is a fit case in which prayer of the 1earned Special Public Prosecutor to withdraw should be allowed and it is therefore allowed" and Dr. Jagannath Misra and other accused persons were ordered to be discharged. It will thus be seen that no reasons at all were given by the learned Chief Judicial Magistrate in his order for giving his consent to the withdrawal of the prosecution against Dr. Jagannath Misra and others. It does not appear from the order as to which ground or grounds ' appealed to the learned Chief Judicial Magistrate for giving his consent to the withdrawal. Sheonandan Paswan thereupon filed Criminal Revision Application No. 874 of 1981 against the order of the learned Chief Judicial Magistrate permitting withdrawal of the prosecution but this application was dismissed in limine by the High Court by an order dated 14th September 1981. The High Court observed that the learned Chief Judicial Magis trate having considered the grounds urged by Lallan Prasad Sinha for withdrawal of the prosecution "was satisfied that permission should be accorded to the special public prosecu tor to withdraw the prosecution" and there was, therefore, no illegality in the Order passed by the learned Chief Judicial Magistrate. The High Court did not even consider for itself whether the grounds on which withdrawal of the prosecution was sought were justified or not. The High Court seem to proceed on the basis that if the learned Chief Judicial Magistrate was satisfied that permission should be accorded for withdrawal of the prosecution, that was enough and it was not necessary for the High Court to examine the validity of the grounds urged for such withdrawal. This view taken by the High Court was, as we shall presently point out, wholly erroneous. Since the High Court rejected the Revision Application in 736 limine, Sheo Nandan Paswan filed the present appeal after obtaining special leave from this Court. The appeal was heard by a Bench of three Judges consisting of Tulzapurkar, Baharul Islam and R.B. Misra, JJ. There was a difference of opinion amongst the Judges in regard to the decision of the appeal. Tulzapurkar, J. took the view that a prima facie case was clearly made out against Dr. Jagannath Misra and others and the ground urged on behalf of the State Govern ment that there was not sufficient evidence which could lead to the conviction of Dr. Jagannath Misra and others, was not well founded. The learned Judge took this view on a detailed consideration of the material which was on record and held that the withdrawal of the prosecution was not justified either on merits or in law and being illegal had to be quashed. Baharul Islam and R.B. Misra, JJ., on the other hand, took the view that the entire investigation was viti ated and no person could be convicted on the basis of evi dence procured as a result of such investigation and the withdrawal of the prosecution was, therefore, justified. Having regard to the majority judgment of Baharul Islam and R.B. Misra, JJ., the appeal was dismissed. Sheo Nandan Paswan thereupon filed a Review application before this Court. But on the date when the Review applica tion was filed, Baharul Islam, J. had already resigned his office as a Judge of this Court. Now, under the Rules of this Court the Review application had to be heard by the same Bench but since Baharul Islam, J. had ceased to be a Judge, A.N. Sen, J. was asked to join Tulzapurkar and R.B. Misra, JJ. and thus the Bench consisting of Tulzapurkar, A.N. Sen and R.B. Misra, JJ. heard the Review application. The judgment of the Review Bench was delivered by A.N. Sen, J on 22nd August 1983 and after setting out the rival argu ments the learned Judge observed: "Applying the well settled principles govern ing a review petition and giving my very anxious and careful consideration to the facts and circumstances of this case, I have come to the conclusion that the review petition should be admitted and the appeal should be re heard. I have deliberately refrained from stating my reasons and the various grounds which have led me to this conclusion. Any decision of the facts and circumstances which, to my mind, constitute errors apparent on the face of the record and my reasons for the finding that these facts and circumstances constitute errors apparent on the face of the record resulting in the success of the review peti tion, may have the possibility of 737 prejudicing the appeal which as a result of my decision has to be re heard." and in the result the learned Judge passed an order admit ting the review petition and directing re hearing of the appeal. But since prior to the date of this judgment the case of Mohd. Mumtaz vs Smt. Nandini Satpathy, had already been referred to a Bench of five Judges, the learned Judge directed that the present appeal should be re heard immediately after Nandini Satpathy 's case. That is how the present appeal has now come before this Bench of five Judges. There was one contention of a preliminary nature ad vanced by Mr. Nariman on behalf of Dr. Jagannath Misra and that contention was that on a proper reading of the order on the Review Petition made by A.N. Sen, J. it was clear that the Review Bench did not exercise the power of review and set aside the order made by the Original Bench. The argument was that the order made by the Original Bench stood un quashed and unreserved and it was therefore not competent to the Constitution Bench to rehear the appeal on merits as if the order of the Original Bench did not exist. It was also urged by Mr. Nariman on behalf of Dr. Jagannath Misra that the order made by the Review Bench was not legal and valid since it was a non speaking order which did not contain any reasons why the order of the Original Bench should be re viewed. This contention was of course not strongly pressed by Mr. Nariman but in any event we do not think that it has any substance. It is undoubtedly true that the order of the Review Bench did not in so many terms set aside the order of the Original Bench and used a rather unhappy expression, namely, "I . admit the Review Petition". But it is clear that when the Review Bench used the expression "I . . admit the Review Petition" it plainly unequivocal ly meant that it was allowing the Review Petition and set ting aside the order of the Original Bench, otherwise it is difficult to understand how it could possibly "direct the reheating of the appeal". The appeal could be reheard only if the Review Petition was allowed and the order of the Original Bench was set aside and therefore obviously when the Review Bench directed rehearing of the appeal, it must by ' necessary implication be held to have allowed the Review Petition and set aside the Order of the Original Bench. We cannot allow the true meaning and effect of the order of the Review Bench to be obfuscated by a slight ineptness of the language used by the Review Bench. We must look at the substance of the Order rather than its apparent form. We must therefore proceed on the basis that the Order of the Original Bench 738 was set aside and reheating of the appeal directed by the Review Bench. We must concede that no reasons appear to have been given by the Review Bench for allowing the Review petition and directing heating of the appeal. The question is: does this introduce any infirmity in the Order of the Review Bench. There can be no doubt that the Review Bench was not legally bound to give reasons for the Order made by it. The apex court being the final court against which there is no further appeal, it is not under any legal compulsion to give reasons for an order made by it. It is not uncommon to find the Supreme Court of the 'United States allowing a writ of certiorari without giving any reasons. But merely because there may be no legal compulsion on the apex court to give reasons, it does not follow that the apex court may dispose of cases without giving any reasons at all. It would be eminently just and desirable on the part of the apex court to give reasons for the orders made by it. But when the apex court disposes of a Review Petition by allowing it and setting aside the order sought to be reviewed on the ground of an error apparent on the face of record, it would be desirable for the apex court not to give reasons for allow ing the Review Petition. Where the apex court holds that there is an error apparent on the face of the record and the order sought to be reviewed must therefore be set aside and the case must be reheard, it would considerably prejudice the losing party if the apex court were to give reasons for taking this view. If the Review Bench of the apex court were required to give reasons, the Review Bench would have to discuss the case fully and elaborately and expose what according to it constitutes an error in the reasoning of the Original Bench and this would inevitably result in pre judgment of the case and prejudice its reheating. A reasoned order allowing a Review Petition and setting aside the order sought to be reviewed would, even before the rehearing of the case, dictate the direction of the reheating and such direction, whether of binding or of persuasive value, would conceivably in most cases adversely affect the losing party at the reheating of the case. We are therefore of the view that the Review Bench in the present case could not be faulted for not giving reasons for allowing the Review Petition and directing reheating of the appeal. It is sig nificant to note that all the three Judges of the Review Bench were unanimous in taking the view that "any decision of the facts and circumstances which . .constitute errors apparent on the face of record and my . . reasons for the finding that these facts and circumstances constitute errors apparent on the face of record resulting in the success of the Review Petition, may have the possibility of prejudicing the 739 appeal which as a result of my decision has to be reheard". This contention of Mr. Nariman must therefore be rejected. The learned counsel on behalf of Dr. Jagannath Misra also raised another contention of a preliminary nature with a view to displacing the locus standi of Sheonandan Paswan to prefer the present appeal. It was urged that when Shri Lallan Prasad Sinha applied for permission to withdraw the prosecution against Dr. Jagannath Misra and others, Sheonan dan Paswan had no locus to oppose the withdrawal since it was a matter entirely between the Public Prosecutor and the Chief Judicial Magistrate and no other person had a right to intervene and oppose the withdrawal, and since Sheonandan Paswan had no standing to oppose the withdrawal, he was not entitled to prefer an appeal against the order of the learned Chief Judicial Magistrate and the High Court grant ing permission for withdrawal. We do not think there is any force in this contention. It is now settled law that a criminal proceeding is not a proceeding for vindication of a private grievance but it is a proceeding initiated for the purpose of punishment to the offender in the interest of the society. It is for maintaining stability and orderliness in the society that certain acts are constituted offences and the right is given to any citizen to set the machinery of the criminal law in motion for the purpose of bringing the offender to book. It is for this reason that in R.S. Nayak vs A.R. Antulay, ; this Court pointed out that "punishment of the offender in the interests of the society being one of the objects behind penal statute enact ed for larger goods of society, the right to initiate pro ceedings cannot be whittled down, circumscribed of lettered by putting it into a strait jacket formula of locus standi". This Court observed that locus standi of the complainant is a concept foreign to criminal jurisprudence. Now if any citizen can lodge a first information report or file a complaint and set the machinery of the criminal law in motion and his locus standi to do so cannot be questioned, we do not see why a citizen who finds that a prosecution for an offence against the society is being wrongly withdrawn, cannot oppose such withdrawal. If he can be a complainant or initiator of criminal prosecution, he should equally be entitled to oppose withdrawal of the criminal prosecution which has already been initiated at his instance. If the offence for which a prosecution is being launched is an offence against the society and not merely an individual wrong, any member of the society must have locus to initiate a prosecution as also to resist withdrawal of such prosecu tion, if initiated. Here in the present case, the offences charged against Dr. Jagannath Misra and others are offences of corruption, criminal breach of trust etc. and therefore any person who is interested in cleanliness of public 740 administration and public morality would be entitled to file a complaint, as held by this Court in R.S. Nayak vs A.R. Antulay (supra) and equally he would be entitled to oppose the withdrawal of such prosecution if it is already insti tuted. We must therefore reject the contention urged on behalf of Dr. Jagannath Misra that Sheonandan Paswan had no locus standi to oppose the withdrawal of the prosecution. If he was entitled to oppose the withdrawal of the prosecution, it must follow a fortiori that on the turning down of his opposition by the learned Chief Judicial Magistrate he was entitled to prefer a revision application to the High Court and on the High Court rejecting his revision application he had standing to prefer an appeal to this Court. We must therefore reject this contention of the learned counsel appearing on 'behalf of Dr. Jagannath Misra. There was also one other contention urged on behalf of Dr. Jagannath Misra with a view to bunking an inquiry by this Court into the merits of the appeal. It was argued on behalf of Dr. Jagannath Misra that this was not a fit case in which the Court should interfere in the exercise of its extraordinary jurisdiction under Article 136 of the Consti tution since the permission granted by the learned Chief Judicial Magistrate for withdrawal of the prosecution had resulted in discharge of Dr. Jagannath Misra in respect of the offences for which he was charge sheeted and this order of discharge was upheld by the High Court in revision and finally by two out of three Judges of this Court and it would be unfair and unjust to reverse the order of discharge and direct a retrial of Dr. Jagannath Misra. We have consid ered this argument but it does not appeal to us. We fail to see any logic behind it. It is undoubtedly true that the effect of the withdrawal of the prosecution against Dr. Jagannath Misra was that he stood discharged in respect of the offences for which he was sought to be prosecuted but it was not an order of discharge which was challenged by Sheo nandan Paswan in the revision application filed by him before the High Court but it was an order granting consent for withdrawal of the prosecution that that assailed by him. The analogy of an order of discharge made under section 227 or section 239 of the Code of Criminal Procedure is not apposite because there the Sessions Judge or the Magistrate, as the case may be, considers the entire material before him and then comes to the conclusion that there is not suffi cient ground for proceeding against the accused or that the charge against the accused is groundless. But here when the Magistrate makes an order granting consent to withdrawal of the prosecution under section 321, it is a totally different judicial exercise which he performs and it would not there fore be right to say that if the High Court sets aside the order of the Magistrate granting consent 741 to withdrawal from the prosecution, the High Court would be really setting aside an order of discharge made by the Magistrate. What the High Court would be doing would be no more than holding that the withdrawal from the prosecution was incorrect or improper and that the prosecution should proceed against the accused and ultimately if there is not sufficient evidence or the charges are groundless, the accused may still be discharged. Moreover it may be pointed out that even an order of discharge made by the Magistrate can be set aside by the High Court in revision if the High Court is satisfied that the order passed by the Magistrate is incorrect, illegal or improper or that the. proceedings resulting in the order of discharge suffer from any irregu larity. The revisional power exercised by the High Court under section 397 is couched in words of widest amplitude and in exercise of this power can satisfy itself as to the correctness, legality or propriety or any order passed by the Magistrate or as to the regularity of any proceedings of such Magistrate. When this Court is hearing an appeal against an order made by the High Court in the exercise of its revisional power under section 397 it is the same revi sional power which this Court would be exercising and this Court therefore certainly can interfere with the order made by the Magistrate and confirmed by the High Court if it is satisfied that the order is incorrect, illegal or improper. In fact, in a case like the present where the question is of purity of public administration at a time when moral and ethical values are fast deteriorating and there seems to be a crisis of character in public life, this Court should regard as its bounden duty a duty owed by it to the socie ty to examine carefully whenever it is alleged that a prosecution for an offence of corruption or criminal breach of trust by a person holding high public office has been wrongly withdrawn and it should not matter at all as to how many Judges in the High Court or the lower court have been party to the granting of such consent for withdrawal. Here in the present case, it is no doubt true that the order granting consent for withdrawal of the prosecution was made by the learned Chief Judicial Magistrate and it was upheld by the High Court and two out of three Judges of the bench of this Court which initially heard the appeal agreed with the view taken by the High Court but we cannot overlook the fact that according to the Review Bench which also consisted of three Judges, there was an error apparent on the face of the record in the judgment of the earlier Bench. The mathe matics of numbers cannot therefore be invoked for the pur pose of persuading this Court not to exercise its discretion under Article 136 of the Constitution. It was then contended on behalf of Dr. Jagannath Misra that 742 Sheonandan Paswan was Minister in the cabinet of Karpoori Thakur and continued to be a member of the political party opposed to Dr. Jagannath Misra and he was therefore actuat ed by political motivation in opposing the withdrawal of prosecution against Dr. Jagannath Misra and in preferring a revision application to the High Court and an appeal to this Court. This contention is also without substance and does not command itself to us. We may concede for the purpose of argument that Sheonandan Paswan opposed the withdrawal of the prosecution against Dr. Jagannath Misra because he had a political score to settle with Dr. Jagannath Misra and he was motivated by a political vendetta. But that is no reason why this Court should sustain an order made by the learned Cheif Judicial Magistrate granting consent for withdrawal of the prosecution if otherwise the order appears to be improp er and unjustified. The question is even if no one had opposed the withdrawal of the prosecution, would the learned Chief Judicial Magistrate and the High Court have been justified in granting consent to the withdrawal of the prosecution and that would depend essentially on the facts and particulars of the case placed before the Court. The political motivation or vendetta of Sheonandan Paswan could not possibly be a valid ground for granting consent for withdrawal of the prosecution if otherwise on the facts and circumstances of the case it was improper and invalid. It is a well established proposition of law that a criminal prose cution, if otherwise justifiable and based upon adequate evidence does not become vitiated on account of mala fides, or political vendetta of the first informant or the com plainant. It was rightly observed by Krishna lyer, J. in State of Punjab vs Gurdial Singh, "If the use of power is for the fulfilment of a legitimate object, the actuation or catalisation by malice is not legiciable." The same principle must obviously apply where a person is opposing withdrawal of prosecution against an accused. His political motivation or vendetta cannot justify grant of consent for withdrawal if otherwise it is not legitimate or justified. It is undoubtedly true that the prosecution against Dr. Jagannath Misra was initiated by the successor Government of Karpoori Thakur after Dr. Jagannath Misra went out of power. But that by itself cannot support the inference that the initiation of the prosecution was actuated by political vendetta or mala fides because it is quite possible that there might be material justifying the initiation of prose cution against Dr. Jagannath Misra and the successor Govern ment might have legitimately felt that there was a case for initiation of prosecution and that is why the prosecution might have been initiated. There would be nothing wrong on the part of the successor Government in 743 doing so and the prosecution cannot be said to be vitiated on that account. This is precisely what Hidayatullah, J. speaking for the Constitution Bench pointed out in Krishna Ballabha Sahay and others vs Commission of Enquiry, ; "The contention that the power cannot be exercised by the succeeding ministry has been answered already by this Court in two Cases. The earlier of the two has been referred to by the High Court already. The more recent case is Shri P.V. Jagannath Rao & Ors. vs State of Orissa, ; It hardly needs any authority to state that the inquiry will be ordered not by the Minister against himself but by some one else. When a Minister goes out of office, its successor may consider any glaring charges and may, if justified, order an inquiry. Otherwise, each Ministry will become a law unto itself and the corrupt conduct of its Ministers will remain beyond scrutiny. " These observations afford a complete answer to the conten tion urged on behalf of Dr. Jagannath Misra that this Court should not interfere with the withdrawal of the prosecution because the successor Government of Karpoori Thakur or Sheonandan Paswan was actuated by political motivation or vendetta. The learned counsel on behalf of Dr. Jagannah Misra also contended that the prosecution should not have been initiat ed against Dr. Jagannath Misra without a prior inquiry made through a Commission of Enquiry set up for that purpose. The argument was that both prudence and propriety requires the setting up of a Commission of Enquiry prior to initiation of the prosecution because an inquiry made through the Commis sion of Enquiry would act as a filter for politically moti vated or mala fide prosecution. This argument is also, in our opinion, without any force and cannot be sustained. It is undoubtedly true that in the past there have been cases where a successor Government has set up a Commission of Enquiry to enquire into the conduct of former Chief Minister and other persons connected with the administration during the regime of the former Chief Minister but that does not mean that no prosecution should be launched against a former Chief Minister or a person holding high pOlitical office under the earlier regime without first setting up a Commis sion of Enquiry for enquiring into his conduct. There is no provision of law which requires such a course of action to be adopted and it cannot be said that if a prosecution is initiated without an inquiry being held by a Commis 744 sion of Enquiry set up for that purpose, the prosecution would be bad or. that on that ground alone the prosecution could be allowed to be withdrawn. The criminal process in India is quite tardy and slow moving and as it is, it takes considerable time for a prosecution to ultimately come to an end and if a requirement were super imposed that no prosecu tion shall be launched against a person holding high politi cal office under an earlier regime without first setting up a Commission of Enquiry and the Commission coming to a prima facie conclusion that such person has committed acts which would constitute offences, the entire criminal process would be reduced to a mockery because the Commission of Enquiry itself might go on for years and after the inquiry is con cluded the prosecution will start where the entire evidence will have to be led again and it would be subject to cross examination followed by lengthy arguments. It would, in our opinion, be perfectly legitimate for the successor Govern ment to initiate a prosecution of a former Chief Minister or a person who has held high political office under the earli er regime without first having an inquiry made by a Commis sion of Enquiry, provided, of course, the investigation is fair and objective and there is sufficient material to initiate such prosecution. There are, under the existing law, sufficient safeguards for the purpose of ensuring that no public servant is harassed by false and vexatious prose cution or charges of corruption because no such prosecution can be initiated without sanction under section 6 of the prevention of Corruption Act or section 197 of the Code of Criminal Procedure, 1973. These safeguards cannot be said to be inadequate even if they do not afford adequate protection in any particular case, the Magistrate is. always there to protect an innocent accused because if in the opinion of the Magistrate, there is not sufficient evidence and the charge against the accused appears to be groundless, the Magistrate may straightaway discharge the accused without taking any evidence. It would become very difficult almost impossible to bring, to use the words of Krishna lyer, J. "the higher inhabitants of Indian public and political decks" within the net of the criminal law if an additional requirement is imposed that there should first be an inquiry by the Commission of Enquiry before any prosecution can be launched against them. This contention urged on behalf of Dr. Jagannath Misra must also, therefore, fail. That takes us to the merits of the question debated before us, namely, whether the learned Chief Judicial Magis trate and the High Court were right in granting consent for withdrawal of the prosecution against Dr. Jagannath Misra and others. The application for withdrawal was made by Shri Lallan Prasad Sinha and consent for such 745 withdrawal was given by the learned Chief Judicial Magis trate under section 321 of the Code of Criminal Procedure, 1973 and consequently, it is this section which falls for construction and application in the present case. The ques tion is whether the application for withdrawal made by Shri Lallan Prasad Sinha was within the scope of his power under section 321 and whether the consent given by the Chief Judicial Magistrate for such withdrawal was within the terms of that section. Section 321 reads as follows: "321. Withdrawal from prosecution The Public Prosecutor or Assistant Public Prosecutor in charge of a case may, with the consent of the Court, at any time before the judgment. is pronounced, withdraw from the prosecution of any person either generally or in respect of any one or more of the offences for which he is tried; and, upon such withdrawal, (a) if it is made before a charge has been framed, the accused shall be discharged in respect of such offence or offences; (b) if it is made after a charge has been framed, or when under this Code no charge is required he shall be acquitted in respect of such offence or offences: Provided that where such offence (i) was against any law relating to a matter to which the executive power of the Union extends, or (ii) was investigated by the Delhi Special Police Establishment under the Delhi Police EStablishment Act, 1946 (25 of 1946); or (iii) involved the misappropriation or de struction of, or damage to, any property belonging to the Central Government, or (iv) was committed by a person in the service of the Central Government while acting or purporting to act in the discharge of his official duty, 746 and the Prosecutor in charge of the case has not been appointed by the Central Government, he shall not, unless he has been permitted by the Central Government to do so, move the Court for its consent to withdraw from the prosecution and the Court shall, before ac cording consent, direct the Prosecutor to produce before it the permission granted by the Central Government to withdraw from the prosecution." This section corresponds to section 494 of the old Criminal Procedure Code, 1898 and it incorporates certain changes which have relevance in that they threw some light on the true interpretation of the section. It may be noted that there are two limbs of section 321. The first is that any Public Prosecutor or Assistant Public prosecutor incharge of a case may withdraw from the prosecution of any person but this power to withdraw from the prosecution is not an unfet tered or unrestricted power because it can be exercised only "with the consent of the Court". If the Court does not give, its consent to the withdrawal of the prosecution, the Public Prosecutor or the Assistant Public Prosecutor cannot with draw it. But the question is as to what are the grounds on which the Public Prosecutor or Assistant Public Prosecutor can apply for withdrawal from the prosecution and also similarly what are the considerations which must weigh with the Court in granting or refusing consent for the withdrawal of the prosecution. There have been a number of decisions of this Court bearing on both these issues but it must be conceded straightaway that these decisions do not disclose any uniform approach. The Court has in some decisions taken very narrow view while in some others it has adopted a broader view. The Court has swung from narrow grounds to broad ones in different decisions from time to time. We shall consider some of these decisions a little later. Now one thing is certain that no unfettered or unre stricted power is conferred on the Public Prosecutor when we refer to Public Prosecutor, we also include Assistant Public Prosecutor to apply for withdrawal from the prosecu tion. It is obvious that the power conferred on the Public Prosecutor to withdraw from the prosecution must be a con trolled or guided power or else it will fall foul of Article 14 of the Constitution. It is necessary in this context to refer to certain other provisions of the Code of Criminal Procedure, 1973 which, though not directly relevant, throw some light on the determination of the question as to what is the extent of the power of the Public Prosecutor to withdraw from the prosecution and how it is controlled and regulated. 747 When a First Information Report relating to the commission of a cognizable offence is lodged in a Police Station under section 154 or an order is made by a Magistrate directing the police to investigate a non cognizable case under sec tion 155, the police is bound to investigate the offence alleged to have been committed. The powers of the police in regard to investigation and the procedure to be followed by them in such investigation are set out in sections 157 to 172. Section 173 sub section (1) casts an obligation on the police to complete the investigation without unnecessary delay and sub section (2) of section 173 then proceeds to state that as soon as the investigation is completed, the officer incharge of the Police Station shall forward to a Magistrate empowered to take cognizance of the offence on a police report, a report in the prescribed form stating the ,various particulars mentioned in that sub section. Section 190 confers power on the Magistrate to take cognizance of an offence and there are three different ways in which cogni zance of an offence may be taken by a Magistrate. This section states that cognizance of an offence may be taken(a) upon receiving a complaint of facts which constitute such an office (b) upon a police report of such facts and (c) upon information received from any person other than a police officer or upon his own knowledge that such offence has been committed. We may concentrate our attention on clause (b) since the section read with that clause clearly goes to show that even in the matter of initiating a prosecution, the police has no unfettered discretion. It is now well settled as a result of several decisions of this Court, of which we may mention only one, namely, H.S. Bains vs State; ; , that even if the report submitted by the police to the Magistrate under section 173 states that in the opinion of the police no offence appears to have been committed and no prosecution may therefore be initiated, the Magistrate can still form an opinion on the facts set out in the report that they constitute an offence and he can take cognizance of the offence and issue process against the accused. The Magistrate may also find, after considering the report, that the investigation is unsatisfactory or incomplete or there is scope for further investigation and in that event, the Magistrate may decline to accept the report and direct the police to make further investigation and then decide whether or not to take cognizance of the offence after considering the report submitted by the police as a result of such further investigation. It will thus be seen that the police has no absolute or unfettered discretion whether to prose cute an accused or not to prosecute him. In fact, in our constitutional scheme, conferment of such absolute and uncanalised discretion would be violative of the equality clause of the Constitution. The Magistrate is therefore given the power to structure and control the discretion of the 748 police. If the Magistrate finds from the report made by the police either on initial investigation or on further inves tigation directed by the Magistrate, that prima facie an offence appears to have been committed, the Magistrate is empowered to take cognizance of the offence notwithstanding the contrary opinion of the police and equally if the Magis trate forms an opinion that on the facts set out in the report no offence prima facie appears to have been committed though the police might have come to a contrary conclusion, the Magistrate can decline to take cognizance of the of fence. The discretion of the police to prosecute is thus 'cabined and confined ' and, subject to appeal or revision, and the Magistrate is made the final arbiter on this ques tion. The Legislature has in its wisdom taken the view that it would be safer not to vest absolute discretion to prose cute in the police which is an Executive arm of the Govern ment but to subject it to the control of the judicial organ of the State. The same scheme has been followed by the Legislature while conferring power on the Public Prosecutor to withdraw from the prosecution. This power can be exercised only with the consent of the Court so that the Court can ensure that the power is not abused or misused or exercised in an arbi trary or fanciful manner. Once the charge sheet is filed and the prosecution is initiated, it is not left to the sweet will of the State or the Public Prosecutor to withdraw from the prosecution. The Court is entrusted with control over the prosecution and as pointed out by Krishna lyer, J. in Subhash Chander vs State and others; ; "The even course of criminal justice cannot be thwarted by the Executive however high the accused, however sure the Govern ment feels a case is false, however unpalatable the continu ance of the prosecution to the powers that be who wish to scuttle court justice because of hubris, affection or other noble or ignoble consideration. " Once the prosecution is launched, its relentless course cannot be halted except on sound considerations germane to public justice. And again, to quote the words of Krishna lyer, J. in the same case, "the Court is monitor, not servitor, and must check to see if the essentials of the law are not breached, without, of course, crippling or usurping the power of the public prose cutor. " The Public Prosecutor cannot therefore withdraw from the prosecution unless the Court before which the prosecu tion is pending gives its consent for such withdrawal. This is a provision calculated to ensure non arbitrariness on the part of the Public Prosecutor and compliance with the equal ity clause of the Constitution. It is also necessary to point out that the law has fashioned 749 another safeguard against arbitrary exercise of power by the Public Prosecutor in withdrawing from the prosecution and this safeguard is that the Public Prosecutor can apply for withdrawal only on the basis of certain legitimate grounds which are germane or relevant to public justice. It is significant to note that the entire development of adminis trative law is characterised by a consistent series of decisions controlling and structuring the discretion con ferred on the State and its officers. The Law always frowns on uncanalised and unfettered discretion conferred on any instrumentality of the State and it is the glory of adminis trative law that such discretion has been through judicial decisions structured and regulated. This Court has there fore, despite fluctuating opinions delivered in different cases, laid down the broad principle and consistently acted upon it, namely, that the power to apply for withdrawal from the prosecution can be exercised only in furtherance of justice. It was pointed out by this Court in M.N. Sankarana rayanan Nair V.P.V. Balakrishnan and others; , , "the essential consideration which is implicit in the grant of the power is that it should be in the interest of administration of justice." So also, one of us, (Bhagwati, J. as he then was) said in State of Orissa vs C. Mohapatra, "the ultimate guiding consideration must always be the interest of administration of Justice. " That is the broad principle under which the Public prosecutor, must bring his case in order to be able to justify his application for withdrawal from the prosecution. What are the different grounds which may possibly come within this principle is a matter which we shall presently discuss but whatever be the grounds on which the application is made it can be sustained only if those grounds are relatable to furtherance of public justice. There was one major question debated before us in regard to the position of the Public Prosecutor in relation to an application for withdrawal from the prosecution and the issue was as to what is the degree of autonomy conferred on the Public Prosecutor vis a vis the Government whilst filing an application for withdrawal. This issue can be operationa lised into three different questions: (1) Does section 321 permit a Public Prosecutor to withdraw from a case without seeking the opinion of the Government (2)whether section 321 empowers a Public Prosecutor to refuse to withdraw from the prosecution despite the advice of the Government to withdraw and (3) where a public prosecutor withdraws from the prose cution on the advice and direction of the Government, does he act contrary to the requirement of section 321? These questions have presented a lot of difficulty and unfortu nately as mentioned earlier the decisions of this Court have not been 750 consistent in the answer to be given to these questions. We shall refer to a few of these decisions. In State of Bihar vs Ram Naresh Pandey; which is the first important case dealing with the interpretation and applica tion of section 321, this Court while deliberating on the role of a Public Prosecutor said: " . . it is right to remember that the Public Prosecutor (though an executive officer as stated by the Privy Council in Bawa Faqir Singh vs The Kind Emperor, [1938] L.R. 65 I.A. 388, 395) is, in a larger sense , also an officer of the Court and that he is bound to assist the Court with his fairly considered view and the Court is entitled to have the benefit of the fair exercise of his function. It has also to be appreciated that in this country the scheme of the administration of criminal justice,is that the primary responsi bility of prosecuting serious offences (which are classified as cognizable offences) is on the executive authorities. Once information of the commission of any such offence reaches the constituted authorities, the investigation including collection of the requisite evi dence, and the prosecution for the offence with reference to such evidence, are the functions of the executive. But the Magistrate also has his allotted functions in course of these stages. ". . . In all these matters he exercises discretionary functions in respect of which the initiative is that of the executive but the responsibility is his." These observations seem to suggest that the prosecution for an offence is the function of the Executive and that the Public Prosecutor is really an Executive Officer who is conducting the prosecution on behalf of the State. So also in M.N. Sankarayaraya Nair vs P.V. Balakrishnan and others (supra) we find that there is a paragraph which seems to impliedly accept governmental directive in the matter of withdrawal from the prosecution as legitimate and that paragraph reads as follows: "The appellant 's Advocate later during the course of the argument conceded that there is no force in the first of his contentions namely that the Public Prosecutor cannot either be asked by the State Government to consider the filing of a petition under sec tion 494 nor would it be proper for him if he was of the opinion that the prosecution ought not to proceed to get the consent of the Government to the 751 filing of a petition under that section for obtaining permission of the Court to withdraw from the prosecution. " This Court also seemed to accept in State of Orissa vs C. Mohapatra (supra) that the policy decision for withdrawal from the prosecution can be made by the State though the application for withdrawal would be made by the Public Prosecutor. This is what the Court said in that case: "We cannot forget that ultimately every of fence has Social or economic cause behind it and if the State feels that elimination or eradication of the social or economic cause behind it would be better served by not pro ceeding with the prosecution the State should be at liberty to withdraw." (italics are ours) This position seems to obtain until 1978 so far as the decided cases are concerned. But in 1978 the trend changed when in Balwant Singh vs State of Bihar; the view that found favour was that the Public Prosecutor is the primary authority to decide on the question of withdrawal from the prosecution. This Court speaking through Krishna Iyer, J observed in this case: "The Statutory responsibility for deciding upon withdrawal squarely vests on the public prosecutor. It is non negotiable and cannot be bartered away in favour of those who may be above him on the administrative side. The Criminal Procedure Code is the only matter of the public prosecutor and he has to guide himself with reference to Criminal Procedure Code only '. Here, the Public Prosecu tor is ordered to move for withdrawal. This is not proper for a District Magistrate to do. Indeed, it is not proper to have the public prosecutor ordered about. It is entirely within the discretion of the public prosecu tor. It may be open to the District Magistrate to bring to the notice of the Public Prosecu tor and suggest to him to consider whether the prosecution should be withdrawn or not. He cannot command where he can only command. " This decision for the first time made the Public Prosecutor autonomous of the Executive in so far as withdrawal from the prosecution is 752 concerned and held that the Public Prosecutor must apply his own mind and come to his own decision whether to apply for withdrawal or not, irrespective of the opinion or advice of the Executive. The same view was reiterated by Krishna lyer J., speak ing on behalf of the Court, in Subhash Chander vs State and others (supra) where the learned Judge said: "The functionary clothed by the Code with the power to withdraw from the prosecution is the Public Prosecutor. The Public Prosecutor is not the executive, nor a flunk of political power. Invested by the Statute with a discre tion to withdraw or not to withdraw, it is for him to apply an independent mind and exercise his discretion. In doing so, he acts as a limb of the judicative process, not as an extension of the executive. " The learned Judge strongly depricated the action of the District Magistrate in directing the Public Prosecutor to withdraw the prosecution in the case before him and observed in words admitting of no doubt: "The jurisprudence of ' genuflexion is alien to our system and the law expects every reposito ry of power to do his duty by the Constitution and the law, regardless of commands, direc tives, threats and temptations. The Code is the master for the criminal process. Any authority who coerces or orders or pressurises a functionary like a public prosecutor, in the exclusive province of his discretion violates the rule of law and any public prosecutor who bends before such command betrays the authori ty of his office. May be, Government or the District Magistrate will consider that a prosecution or class of prosecutions deserves to be withdrawn on grounds of policy or rea sons of public interest relevant to law and justice in their larger connotation and re quest the public prosecutor to consider wheth er the case or cases may not be withdrawn. Thereupon, the Prosecutor will give due weight to the material placed, the policy behind.the recommendation and the responsible position of Government, which in the last analysis, has to maintain public order and promote public justice. But the decision to withdraw must be his." this case also, like the earlier one in Balwant Singh vs State of Bihar 753 (supra), introduced the concept of independent application of mind by the Public Prosecutor on the question of with drawal from the prosecution and insisted that the Executive cannot direct or pressurise the Public Prosecutor to with draw from the prosecution and the Public Prosecutor must come to his own decision without bending before the command of the Executive. Once this component of independent appli cation of mind on the part of the Public Prosecutor was introduced the Court while considering whether consent for such withdrawal should be granted or not was required to deliberate not only on the legitimacy of the grounds urged in support of the withdrawal but also whether the Public Prosecutor had applied his mind in the matter. But then again there was a slight shift in this posi tion in the latest decision in R.K. Jain vs State, [ ; The Court in this case adopted a more middle of the road approach and after pointing out what 'the Court con ceived to be the correct position in law in the following words: "Whilst at one point it said that it shall be the duty of the Public Prosecutor to inform the Court ' and it shall be the duty of the Court to appraise itself of the reasons which prompt the Public Prosecutor to withdraw from the prosecution. The Court has a responsibili ty and stake in the administration of criminal justice and so has the Public Prosecutor, its 'Minister of Justice. ' Both have a duty to protect the administration of criminal justice against possible abuse or misuse by the Executive by resort to the provisions of s.321 Cr. PC." (emphasis is ours) The Court recognised that the Government has a role in the administration of criminal justice and observed: "An elected Government, sensitive and responsive to the feelings and emotions of the people, will be amply justified if for pur poses of creating an atmosphere of goodwill or for the purpose of not disturbing the calm which has descended it decides not to prose cute the offenders involved or not to proceed further with prosecutions already launched. In such matters who but the Government can and should decide in the first instance whether it should be baneful or beneficial to launch or continue prosecutions. If the Government decides that it would be in the interest to withdraw from 754 prosecutions, how is the Government to go about to task?" (emphasis is ours). and proceeded to add that the Public Prosecutor may act on the advice of the Government in applying for withdrawal of the prosecution "where large and sensitive issues of public policy are involved. " Chinnappa Reddy, J. speaking on behalf of the Court elaborated this view in the following words: "Where large and sensitive issues of public policy are involved he must if he is right minded the Public Prosecutor seek advice and guidance from the policy makers. His sources of information and resources are of a very limited nature unlike those of the policy makers. If the policy makers themselves move in the matter in the first instance as indeed it is proper that they should where matters of momentous public policy are involved and if they advice the Public Prosecutor to withdraw from the prosecution,. it is not for the Court to say that the initiative came from the Government and therefore the Public Prosecutor cannot be said to have exercised a free mind." (Emphasis is ours) The majority Judges however took a different view in the present appeal when it was heard by the earlier Bench. Baharul Islam, J. stated the view of the majority in the following terms: "Unlike the Judge, the Public Prosecutor is not an absolutely independent officer. He is an appointee of the Government, Central or State (see sections 24 and 25, CrPC), appoint ed for conducting in court any prosecution or other proceedings on behalf of the Government concerned. So there is the relationship of counsel and client between the Public Prosecu tor and the Government. A Public Prosecutor cannot act without instructions of the Govern ment; a Public Prosecutor cannot conduct a case absolutely on his own, or contrary to the instruction of his client, namely, the Govern ment . Section 321 of the Code does not lay any bar on the Public Prosecutor to receive any instruction from the Government before he files an application under that section. If the Public Prosecutor receives such instruc tions, he cannot be said to act under extrane ous influence. On the contrary, the Public Prosecutor cannot file an application for withdrawal of a 755 case on his own without instruction from the Government . In our opinion, the object of Section 321, Cr. P.C. appears to be to reserve power to the Executive Government to withdraw any criminal case on larger grounds of public policy such as inexpediency of prosecutions for reasons of State, broader 'public interest like maintenance of ,law and order, maintenance of public peace and harmo ny, social, economic and political; changed social and political situation; avoidance of destabilization of a stable government and the like. And such powers have been, in our opin ion, rightly reserved for the Government, for, who but the Government is in the know of such conditions and situations prevailing in a State or in the country? The Court is not in a position to know such situations. " It will thus be seen that the position in law in regard to the degree of autonomy enjoyed by the Public Prosecutor vis a vis the Government in filing an application for with drawal of the prosecution is rather confused and it would be desirable to approach the question on first principle. Now there can be no doubt that prosecution of an offend er who is alleged to have committed an offence is primarily the responsibility of the Executive. It is the executive which is vested with the power to file a charge sheet and initiate a prosecution. This power is conferred on the Executive with a view to protecting the society against offenders who disturb the peace and tranquillity of the society by committing offences. Of course it is left to the Court to decide whether to take cognizance of the offences set out in the charge sheet but the filing of the charge sheet and initiation of the prosecution is solely within the responsibility of the Executive. When the prosecution is initiated by filing a charge sheet the Public Prosecutor comes into the picture. Of course, even before the charge sheet is filed, the investigating, authorities may seek the advice of the Public Prosecutor in regard to the prosecution of the accused but it is not obligatory on the investi gating authorities to do so. The Public Prosecutor comes on the scene as soon as the charge sheet is filed and he ap pears and argues the case on behalf of the prosecution. It is the State through the investigating authorities which files a charge sheet and initiate the prosecution and the Public Prosecutor is essentially counsel for the State for conducting the prosecution on behalf of the State. The expression "Public Prosecutor" is defined in section clause (u) to mean" any person appointed under section 24 and includes any person acting under the 756 directions of a Public Prosecutor. " Section 24 provides for the appointment of a Public Prosecutor: sub section (1) of section 24 states that "for every High Court the Central Government or the State Government shall, after consultation with the High Court, appoint a Public Prosecutor and may also appoint one or more Additional Public Prosecutors for conducting in such court any prosecution, appeal or other proceeding on behalf of the Central Government or State Government, as the case may be". (Emphasis is ours). Sub section(3) of section 24 enacts that for every District, the State Government shall appoint a Public Prosecutor and may also appoint one or more Additional Public Prosecutors for the district and under sub section(7) of that section a person is eligible for being appointed as a Public Prosecu tor or an Additional Public Prosecutor only if he has been in practice as an advocate for not less than 7 years. Thus the Public Prosecutor appointed by the State Government conducts the prosecution on behalf of the State Government and the Public Prosecutor appointed by the Central Govern ment does so on behalf of the Central Government. It is undoubtedly true that the Public Prosecutor is an officer of the Court, as indeed every advocate practising before the Court is, and he owes an obligation to the Court to be fair and just: he must not introduce any personal interest in the prosecution nor must he be anxious to secure conviction at any cost. He must present the case on behalf of the prosecu tion fairly and objectively and as pointed out by this Court in State of Bihar vs Ram Naresh Pandey (supra) he is bound to assist the court with his fairly considered view and the fair exercise of his judgment. But at the same time it must be noted that he conducts the prosecution on. behalf of the Central Government or the State Government, as the case may be, and he is an advocate acting on behalf of the Central Government or the State Government which has launched the prosecution. We are therefore of the view that there is nothing wrong if the Government takes a decision to withdraw from the prosecution and communicate such direction to the Public Prosecutor. The Public Prosecutor would inter alia consider the grounds on which the Government has taken the decision to withdraw from the prosecution and if he is satisfied that these grounds are legitimate, he may file an application for withdrawal from the prosecution. If on the other hand he takes the view that the grounds which have been given by the Government are not legitimate he has two options available to him. He may inform the Government that in his opinion, the grounds which have weighed with the Government are not valid and that he should be relieved from the case and if this request of his is not granted, he may tender his resignation. Or else, he may make an application for withdrawal from the prosecution as directed by the 757 Government and at the hearing of the application he may offer his considered view to the court that the application is not sustainable on the grounds set out by him and leave it to the court to reject the application. We do not think there is anything wrong in the Public Prosecutor being advised or directed by the Government to file an application for withdrawal from the prosecution and the application for withdrawal made by him pursuant to such direction or advice is not necessarily vitiated. The Public Prosecutor can of course come to his own independent decision that the prose cution should be withdrawn but ordinarily if he is wise and 'sensible person he will not apply for withdrawal without consulting the Government because it is the Government which has launched the prosecution and is prosecuting the accused. The critically, of course, he can make an application for withdrawal from the prosecution without consulting the Government and he cannot be accused of any illegality for doing so and the court may give its consent for such with drawal but in that event the Public Prosecutor would render the risk of incurring the displeasure of the Government which has appointed him. If the Public Prosecutor seeks the permission of the Government for withdrawal from the prose cution and the Government grants such permission to him and on the basis of such permission he applies for withdrawal the application cannot be said to be vitiated. The proviso to section 321 in fact contemplates in so many terms that in certain categories of offences the Public Prosecutor ap pointed by the State Government cannot move the Court for its consent to withdraw from the prosecution without the permission of the Central Government. There is no danger of abuse or misuse of power by the Government inherent in this process because there are two principal safeguards against any such abuse or misuse of power by the Government: one is that the application must be based on grounds which advance public justice and the other is that there can be no with drawal without the consent of the court. Now let us consider the question as to what are the grounds on which the Public Prosecutor can apply for with drawal from the prosecution. These grounds have been var iously stated in the decisions of this Court but the basic principle under lying all these grounds is that the with drawal can be sought only for furthering the cause of public justice. If we. may repeat what we have said before, the paramount consideration must always be the interest of administration of justice. That is the touch stone on which the question must be determined whether an application for withdrawal of the prosecution can be sustained. This Court tried to formulate several instances where the cause of public justice Would be served better by withdrawal from the pro 758 secution. It was observed by this Court in M.N. Sankarava raya vs P.V. Balakrishnan (supra) that an application for withdrawal from the prosecution may be made on the ground that "it will not be possible to produce sufficient evidence to sustain the charge or that subsequent information before prosecuting agency would falsify the prosecution evidence or in any other similar circumstances which it is difficult to predicate aS they are dependent entirely on the facts and circumstances of each case". This Court also pointed out in State of Orissa vs C. Mohapatra (supra) that "it is not sufficient for the Public Prosecutor merely to say ' that it is not expedient to proceed with the prosecution. He has to make out some ground which would show that the prosecution is sought to be withdrawn because inter alia the prosecution may not be able to produce sufficient evidence to sustain the charge or that the prosecution does not appear to be well founded or that there are circumstances which clearly show that the object of administration of justice would not be advanced or furthered by going on with the prosecution. " It was also emphasised by this Court in Subhash Chander vs State (supra) that "justice cannot be allowed to be scuttled by the Public Prosecutor or the State because of hubris affection or other noble or ignoble considerations. " This Court also observed in R.K. Jain vs State (supra): "In the past we have often known how expedient and necessary it is in the public interest for the public Prosecutor to withdraw from prose cutions arising out of mass agitations, commu nal riots, regional disputes, industrial conflicts, student unrest etc. Wherever issues involve the emotions and there is a surcharge of violence in the atmosphere it has often been found necessary to withdraw from prosecu tions in order to restore peace, to free the atmosphere from the surcharge of violence, to bring about a peaceful settlement of issues and to persist with prosecutions where emotive issues are involved in the name of vindicating the law even be utterly counter productive. An elected Government, sensitive and responsive to the feelings and emotions of the people, will be amply justified if for the purpose of creating an atmosphere of goodwill or for the purpose of not disturbing a calm which has descended it decides not to prosecute the offenders involved or not to proceed further with prosecutions already launched. " It will thus be seen that the Public Prosecutor cannot maintain an application for withdrawal from the prosecution on the ground that the 759 Government does not want to produce evidence and proceed with the prosecution against the accused or that the Govern ment considers that it is not expedient to proceed with the prosecution. The Public Prosecutor has to make out some ground which would advance or further the cause of public justice. If the Public Prosecutor is able to show that he may not be able to produce sufficient evidence to sustain the charge, an application for withdrawal from the prosecu tion may be legitimately made by him. But there are two clarifications which we would like to introduce where the prosecution is sought to be withdrawn on this ground. The first qualification is that where a charge has been framed by the Court either under section 228 or section 240 of the Code of Criminal Procedure, 1973, it would not be open to the Public Prosecutor to apply for withdrawal from the prosecution on the ground of insufficiency of evidence in support of the prosecution. The reason is that under section 228 a charge can be framed by the Court only if the court is of opinion that there is ground for presuming that the accused has committed an offence and so also under Section 240 the Court can frame a charge only if it is of opinion that there is ground for presuming that the accused has committed an offence. The Court in both these cases applies its mind to the material consisting of the police report and the documents sent with it under section 173 and comes to a conclusion that a prima facie case has been made out against the accused and the charge should therefore be framed. When the Court has come to this conclusion after full consideration and framed a charge, it is difficult ' to see how on the same material the Court can be persuaded to hold that there is not sufficient evidence to sustain the prosecution. How can the Public Prosecutor be permitted to make a volte face on the basis of the same material? That would be mockery of justice and it would shake the confi dence of the people in the purity and integrity of the administration of justice. That is why this Court pointed out in Bansi Lal vs Chandi Lal, AIR that, "if the material before the Additional Sessions Judge was con sidered sufficient to enable him to frame the charges against the respondents, it is not possible to say that there was no evidence in support of the prosecution case." So also in Balwant Singh vs State (supra) this Court reiter ated that "the State should not stultify the Court by first stating that there is a true case to be tried and then make volte face to the effect that on a second investigation the case has been discovered to be false." The Public Prosecutor in this last mentioned case sought to rely on a second investigation for supporting.the application for withdrawal but, that was clearly and unequivocally not countenanced by this 760 Court. Obviously, the Public Prosecutor would be on much weaker ground when on the same material which was before the Court when it flamed the charge, he subsequently seeks to withdraw the prosecution on the ground that there is not sufficient evidence to sustain the prosecution. It is, therefore, dear that though the prosecution can be withdrawn at any stage, even after the flaming of the charge, it would not be competent to the Public Prosecutor, once the charge is framed, to apply for withdrawal of the prosecution on the ground that the same material which was before the Court when it framed the charge is not sufficient to sustain the prosecution. Of course, if some material has subsequently come to light which throws doubt on the veracity of the prOsecution case the Public Prosecutor can certainly apply for withdrawal on the ground that the prosecution is not well founded. It may also happen that in the meanwhile a key witness may have died or some important evidence may have become unavailable or some such thing may have happened; in that event, the Public Prosecutor may legitimately feel that it will not be possible to sustain the prosecution in the absence of such evidence and he may apply for withdrawal from the prosecution. But, on the same material without anything more, the Public Prosecutor cannot apply for with drawal from the prosecution after the charge is flamed. To allow him to do so would impair the faith of the people in the purity and integrity of the judicial process. The second qualification which we must introduce relates to a situation where a charge sheet has been filed but charge has not been framed in a warrant case instituted on police report. Section 239 of the Code of Criminal Proce dure, 1973 provides: "If, upon considering the police report and the documents sent with it under section 173 and making such examination, if any, of the accused as the Magistrate thinks necessary and after giving the prosecution and the accused an opportunity of being heard, the Magistrate considers the charge against the accused to be groundless, he shall discharge the accused, and record his reasons for so doing. " Now when a warrant case instituted on a police report comes before the Court, the Court is required to consider only the police report and the documents sent alongwith it and the Court may make such examination, if any, of the accused as it thinks necessary and on the basis of such material if the Court, after giving the prosecution and the accused an opportunity of being heard, considers the charge against the accused to be groundless, the Court is bound to discharge the accused. 761 What the Court, therefore, does while exercising its func tion under section 239 is to consider the police report and the document sent along with it as also any statement made by the accused if the court chooses to examine him. And if the court finds that there is no prima facie case against the accused the court discharges him. But that is precisely what the court is called upon to do when an application for withdrawal from the prosecution is made by the public prose cutor on the ground that there is insufficient or no evi dence to support the prosecution. There also the court would have to consider the material placed before it on behalf of the prosecution for the purpose of deciding whether the ground urged by the public prosecutor for withdrawal of the prosecution is justified or not and this material would be the same as the material before the court while discharging its function under section 239. If the court while consider ing an application for withdrawal on the ground of insuffi ciency or, absence of evidence to support the prosecution has to scrutinise the material for the purpose of deciding whether there is in fact insufficient evidence or no evi dence at all in support of the prosecution, the court might as well engage itself in this exercise while considering under section 239 whether the accused shall be discharged or a charge shall be framed against him. It is an identical exercise which the Court will be performing whether the court acts under section 239 or under section 321. If that be so, we do not think that in a warrant case instituted on a police report the public prosecutor should be entitled to make an application for withdrawal from the prosecution on the ground that there is insufficient or no evidence in support of the prosecution. The court will have to consider the same issue under section 239 and it will most certainly further or advance the case of public justice if the court examines the issue under section 239 and gives its reasons for discharging the accused after a judicial consideration of the material before it, rather than allow the prosecution to be withdrawn by the Public Prosecutor. When the prosecu tion is allowed to be withdrawn there is always an uneasy feeling in the public mind that the case has not been al lowed to be agitated before the court and the court has not given a judicial verdict. But, if on the other hand, the court examines the material and discharges the accused under section 239, it will always carry greater conviction with the people because instead of the prosecution being with drawn and taken out of the ken of judicial scrutiny the judicial verdict based on assessment and evaluation of the material before the court will always inspire greater confi dence. Since the guiding consideration in all these cases is the imperative of public justice and it is absolutely essen tial that justice must not only be done but also appear to be done. We would hold that in a warrant case instituted on a police report which 762 the present case against Dr. Jagannath Misra and others admittedly is it should not be a legitimate ground for the public prosecutor to urge in support of the application for withdrawal that there is insufficient or no evidence in support of the prosecution. The court in such a case should be left to decide under section 239 whether the accused should be discharged or a charge should be framed against him. We may also reiterate what was pointed out by this Court in State of Orissa vs C. Mohapatra (supra) that in a given case it may not be "conducive to the interest of justice to continue the prosecution . since the prosecution with the possibility of conviction" may rouse feelings of bitter ness and antagonism and disturb the calm and peaceful atmos phere which has been restored. We cannot forget that ulti mately every offence has a social or economic cause behind it and if the State feels that the elimination or eradica tion of the social or economic cause of the crime would be better served by not proceeding with the prosecution, the State should clearly be at liberty to withdraw from the prosecution. This was the ground on which this court in State of Orissa vs C. Mohapatra (supra) allowed withdrawal of the prosecution in a case where the incident resulting in the commission of the offence had arisen out of rivalry between two trade unions but since the date of the incident calm and peaceful atmosphere prevailed in the industrial undertaking. There may be broader considerations of public peace, larger considerations of public justice and even deeper considerations of promotion of long lasting security in a locality, of order in a disorderly situation or harmony in a factious milieu which may legitimately persuade the State to "sacrifice a pending case for a wider benefit". The imperative of public justice may in such cases transcend and overflow the legal justice of a particular litigation. We are wholly in agreement with what this Court in Balwant Singh vs State of Bihar (supra): ". communal feuds which may have been amicably settled should not re erupt on ac count of one or two prosecutions pending. Labour disputes which, might have given rise to criminal cases, when set tled, might probably be another instance where the interests of public justice in the broader connotation may perhaps warrant withdrawal from the prosecution. " We also express our approval of the observations made by this Court in R.K. Jain vs State (supra) which we have reproduced above: These are broadly the considerations which can be brought under the rubric of public justice so as to justify an application for withdrawal from prosecution. But, of course, we must make it clear that in this area no hard and fast rule can be laid down nor can any categories of 763 cases be defined in which an application for withdrawal of the prosecution could legitimately be made. It must ulti mately depend on the facts and circumstances of each case in the light of what is necessary in order to promote the ends of justice. When the application for consent to the withdrawal from the prosecution comes for consideration, the Court has to decide whether to grant such consent or not. The function which the court exercises in arriving at this decision, as pointed out by this Court in State of Bihar vs Ram Naresh, is a judicial function. The Court has to exercise its judi cial discretion with reference to such material as is then available to it and in exercise of this discretion the court has to satisfy itself that the executive function of the public prosecutor has not been improperly exercised and that the grounds urged in support of the application for with drawal are legitimate grounds in furtherance of public justice. The discretion has not to be exercised by the court mechanically and the consent applied for has not to be granted as a matter of formality or for the mere asking. The Court has to consider the material placed before it and satisfy itself that the grant of consent would serve the interest of justice. That is why this Court in State of Bihar vs Ram Naresh (supra) examined the entire material which was available to it for the purpose of coming to the conclusion that there was no evidence worth the name on the basis of which the prosecution could be sustained against the accused Mahesh Desai. This court pointed out that con sent is not to be lightly given on the application of public prosecutor "without a careful and proper scrutiny of the grounds on which the application for consent is made. " It was emphasised by this Court that in these matters the public prosecutor exercises discretionary functions in respect of which the initiative is that of the executive but the responsibility is that of the court. This court again reiterated in M.N. Sankarayaraynanan Nair vs P.V. Balakrish nan & Ors. (supra) that the court must satisfy itself that the executive function of the public prosecutor has not been improperly exercised and that it is not an attempt to inter fere with the normal course of justice and added that the court may give its permission only if it is satisfied on the materials placed before it that the grant of consent sub serves the administration of justice. The same view has been taken in all the subsequent cases and it must now be regard ed as well settled that the court while considering whether 'to grant consent or not must not accept the ipse dixit of the public prosecutor and content itself by merely examining whether the public prosecutor has applied an independent mind but the court must satisfy itself not only that the grounds are germane or relevant to advancement of public justice but also 764 whether the grounds in fact are satisfactorily established. The ultimate test which must be applied by the court in order to determine the validity of the grounds in a particu lar case is that the requirement of public justice outweighs the legal justice of that case so that withdrawal from the prosecution could be permitted in the larger interest of public justice. The same considerations which we have dis cussed while determining what are the legitimate grounds on which an application may be made by the public prosecutor for withdrawal from the prosecution must also apply in guiding the court as to whether consent for withdrawal of the prosecution should be granted or not. We may again emphasise that the imperative of public justice provides the only relevant consideration for determining whether consent should be granted or not. It is not possible to provide an exclusive definition of what may be regarded as falling within the imperative of public justice nor is it possible to place the concept of public justice in a strait jacket formula. Every case must depend on its peculiar facts and circumstances because there may be a myriad situation where this question may have to be considered by this court. The paramount consideration must be the requirement of public justice and some of the grounds which would bring the case within the fabric of public justice have already been dis cussed by us in the preceding paragraphs and we need not repeat them. The same grounds may be regarded as germane and relevant to the requirement of public justice and if they exist, the court would be justified in granting consent to withdrawal from the prosecution. If we apply these principles to the facts of the present case, it is clear that the court of the Chief Judicial Magistrate, Patna as also the High Court were clearly in error in granting consent to the withdrawal from the prose cution against Dr. Jagannath Misra and others. We do not propose to go into the question whether the material avail able to the court could be regarded as sufficient for sus taining the prosecution of Dr. Jagannath Misra and others because if we consider this question and make any observa tions in regard to the sufficiency of the material, such observations may tend to prejudice Dr. Jagannath Misra and the other accused. Of course, if there were no other reasons which would persuade the court not to grant consent to the withdrawal of the prosecution, we would have had to go into the question whether the material produced before the court was sufficient prima facie to sustain the prosecution. But, there are two very strong and cogent reasons why consent to the withdrawal of the prosecution must be refused. In the first place, the learned Chief Judicial Magistrate could have considered under section 239 whether the material placed before him was 765 sufficient to make out a prima facie case against Dr. Jagan nath Misra and the other accused so that if the learned Chief Judicial Magistrate came to the conclusion on the basis of such material that the charge against Dr. Jagannath Misra and the other accused was groundless, he would be bound to discharge them for reasons to be recorded by him in writing. There is no reason why in these circumstances the public prosecutor should be allowed to withdraw from the prosecution under section 321. The same exercise could be performed by the learned Chief Judicial Magistrate by acting under section 239. Moreover, in the present case, the deci sion to withdraw from the prosecution was taken by the Cabinet at a meeting held on 24th February 1981 and this meeting was presided over by Dr. Jagannath Misra himself. It may be that Shri Lallan Prasad Sinha did not implicitly obey the decision of the Cabinet and applied his independent mind to the question whether the prosecution should be withdrawn or not but even so, it would seriously undermine the confi dence of the people in the administration of justice if a decision to withdraw the prosecution against him is taken by the accused himself and pursuant to this decision the Spe cial Public Prosecutor who is appointed by the State Govern ment of which the accused is the Chief Minister, applied for withdrawal from the prosecution. It is an elementary princi ple that justice must not only be done but must also appear to be done. It would be subversive of all principles of justice that the accused should take a decision to withdraw the prosecution against himself and then the Special Public Prosecutor appointed in effect and substance by him makes an application for withdrawal from the prosecution. We are of the view that these two considerations are so strong and cogent that consent to withdraw from the prosecution should not have been granted in the present case. It is no doubt true that if there is not sufficient evidence to sustain the prosecution against Dr. Jagannath Misra and the other accused, it would be subjecting them to harassment and inconvenience to require them to appear and argue before the Court for the purpose of securing an Order of discharge under section 239, but even so we think it would be desirable in the interest of public justice that high ' political personages, accused of offences should face the judicial process and get discharged, rather than seem to manoeuvre the judicial system and thus endanger the legiti macy of the political as well as the judicial process. It is possible that in a particular case personal harassment or inconvenience may be caused by non withdrawal of the prose cution, if the accused is really innocent and is ultimately liable to be discharged, but such harassment or inconven ience must be considered as an inevitable cost of public life, which the repositories of public power should have no hesitation to pay, as justice must not only be 766 done but must also appear to be done. We accordingly allow the appeal, set aside the Order made by the Chief Judicial Magistrate and confirmed by the High Court and direct that the prosecution may proceed against Dr. Jagannath Misra and the other accused in accord ance with law. VENKATARAMIAH, J. I have gone through the judgments of Bhagwati, C.J. and Khalid, J. which are pronounced today. I have also gone through the orders of the Special Judge who permitted the withdrawal of the prosecution, the judgment of the High Court affirming it, the three judgments pronounced by Tulzapurkar, J., Bahrul Islam, J. and R.B. Misra, J. by which this Court by majority affirmed the order permitting withdrawal of the criminal case in question and also of A.N. Sen, J. who passed the orders admitting the review petition. The facts of the case are set out in the judgments referred to above and it is unnecessary to repeat them here. I have given my anxious consideration to the case since it relates to the purity of public life. At the outset it should be stated that merely because a court discharges or acquits an accused arraigned before it, the Court cannot be considered to have compromised with the crime. Corruption, particularly at high places should be put down with a heavy hand. But our passion to do so should not overtake reason. The Court always acts on the material before it and if it finds that the material is not suffi cient to connect the accused with the crime, it has to discharge or acquit him, as the case may be, notwithstanding the fact that the crime complained of is a grave one. Simi larly if the case has been withdrawn by the Public Prosecu tor for good reason with the consent of the Court, this Court should be slow to interfere with the order of with drawal. In this case if the Special Judge had rejected the application for withdrawal and the High Court had affirmed that Order, this Court may not have interfered with that order under Article 136 of the Constitution of India. Even if the Special Judge had permitted the withdrawal but the High Court had reversed that order, this Court may not have interfered with the orders of the High Court. But this is a case where the Special Judge had permitted the withdrawal of the prosecution, and the said order of withdrawal has been affirmed by the High Court as well as by the majority judg ment pronounced by this Court earlier. The question is whether this Court on review should interfere with the order permitting the withdrawal of the ease. Are there any strong and compelling reasons which require interference with the order permitting withdrawal? This is the question which has arisen before us now. 767 Since the orders of the Special Judge, of the High Court and of Bahrul Islam, J. and R.B. Misra, J. are in favour of the accused, I shall not refer to them. I shall refer only to the judgment of Tulzapurkar, J. (See Sheonandan Paswan versus State of Bihar and others); ; , who has held against the accused to decide whether there are sufficient incriminating circumstances which compel this Court to set aside the order permitting withdrawal of the prosecution. In his judgment at pages 101 to 103 Tulzapur kar, J. summarises the case against Dr. Jagannath Misra thus: "It will appear clear from the above discus sion that the documentary evidence mentioned above, the genuineness of which cannot be doubted, clearly makes out a prima facie case against Respondent No. 2 sufficient to put him on trial for the offence of criminal miscon duct under section 5(1) (d) read with section 5(2) of the Prevention of Corruption Act, 1947. Simi lar is the position with regard to the inci dental offence of forgery under s.466, I.P.C. said to have been committed by him, for, ante dating of the second order by him is not disputed; and it is on record that in regard to such ante dating no explanation was offered by him during the investigation when he was questioned about it in the presence of his lawyers and there has been no explanation of any kind in any of the counter affidavits filed before us. But during the course of arguments his counsel offered the explanation that could only be ascribed as a bona fide mistake or slip (vide written arguments filed on 14.10.1982) but such explanation does not bear scrutiny, having regard to the admitted fact that after the ante dated order was pasted over the first order the despatch date appearing in the margin was required to be and has been altered to 14.5.1975 by over writing is required to be done there cannot any bona fide mistake or slip. The ante dating in the circumstances would be with oblique intent to nullify any possible action that could have or might have been taken pursuant to the first order as stated earlier, that being the most natural consequence flowing from it which must in law be presumed to have intended. It would, of course, be open to him to rebut the same at the trial but at the moment there is no mate rial on record by way of rebuttal. In the circumstances it is impossible to accept the paucity of evidence or lack of prospect of successful prosecution as a valid ground for withdrawal from the prosecution. On the 768 aforesaid undisputed documentary evidence no two views are possible in the absence of any rebuttal material, which, of course, the respondent No.2 will have the opportunity to place before the Court at the trial. What is more the socalled unfair or over zealous investigators were miles away when the afore said evidence came into existence. As far as Respondent No. 3 (Nawal Kishore Sinha) and Respondent No.4 (Jiwanand Jha) are concerned it cannot be forgotten that they have been arraigned alongwith Respondent No. 2 on a charge of criminal conspiracy in pursuance whereof the several offences are said to have been committed by all of them. Further it is obvious that the principal beneficiary of the offence of criminal miscon duct said to have been committed by Respondent No. 2 under section 5(1) (d) read with section 5(2) of Prevention of Corruption Act, 1947 has been Respondent No. 3 and so far as Respondent No.4 is concerned it cannot be said that there is no material on record suggesting his complici ty. Admittedly, he has been very close to Respondent No. 2 for several years and attend ing to his affairs priVate and party affairs and the allegation against him in the F.I.R is that he was concerned with the deposit of two amounts of Rs. 10,000 and Rs.3,000 on 27.12.1973 and 1.4.1974 in the Savings Bank Account of Respondent No. 2 with the Central Bank of India, Patna Dak Bungalow Branch, which sums, says the prosecution, represented some of the bribe amounts said to have been received by respondent No. 2 and the tangible documentary evidence in proof of the two deposits having been made in Respondent No. 2 's account consists of two pay in slips of the concerned branch of Central Bank of India. Whether the two amounts came from the funds of the Patna Urban Co operative Bank or not and whether they were really paid as bribe amounts or not would be aspects that will have to be considered at the trial. However, as pointed out earlier the offence under s.5(1) (d) would even otherwise be complete if pecuniary advan tage (by way of scuttling the civil liability of surcharge) was conferred on Nawal Kishore Sinha and others. If Respondent No. 2 has to face the trial then in a case where conspiracy has been charged no withdrawal can be permit ted against Respondent No. 3 and Respondent No. 4. In arriving at the conclusion that paucity of evidence 769 is not a valid ground for withdrawal from the prosecution in regard to Respondents Nos. 2,. 3 and 4. I have deliberately excluded from consideration the debatable evidence like confessional statements of the approvers etc. (credibility and effect whereof would be for the trial court to decide) said to have been collected by the allegedly over zealous inves tigating officers after Respondent No.2 went out of power in 1977. " The three circumstances put up against the accused in this case are (i) that Jiwanand Jha had credited Rs.10,000 and Rs.3000 on 27.12.1973 and on 1.4.1974 respectively in the Savings Bank account of Dr. Jagannath Misra, (ii) that there was ante dating of the order passed by Dr. Jagannath Misra on 16.5.1975 and it had been shown as having been passed on 14.5.1975, and (iii) that there was a confessional statement of Hydari which supported the prosecution. Tulza purkar, J. himself has found it not safe to act on the confessional statement. He observes "I have deliberately excluded from consideration the debatable evidence like confessional statement of approvers (credibility and effect whereof would be for the trial court to decide) said to have been collected by the allegedly over zealous investigating officers after Respondent No. 2 went out of power in 1977". The two other circumstances on which Tulzapurkar, J. has acted are (i) the crediting of Rs. 10,000 and Rs.3,000 on 27.12.1973 and 1.4.1974 respectively in the Savings Bank Account of Dr. Jagannath Misra by Jiwanand Jha and (ii) the ante dating of the orders dated 16.5.1975. As regards the first of these two circumstances Tulza purkar, J. Observes: "Admittedly, he (Jiwanand Jha) has been very close to Respondent No. 2 (Dr. Jagannath Misra) for several years and attending to his affairs private and party affairs and the allegation against him in the F.I.R. is that he was concerned with the deposit of two. amounts of Rs. 10,000 and Rs.3,000 on 27.12.1973 and on 1.4.1974 respec tively in the Savings Bank Account of Respondent No. 2 with the Central Bank of India, Patna Dak Bungalow Branch, which sums, says the prosecution represented some of the bribe amounts said to have been received by Respondent No.2 and the tangible documentary evidence of the two deposits having been made in Respondent No. 2 's account consists of two pay in slips of the concerned Branch of Central Bank of India. Whether the two amounts came from the funds of the Patna Urban Co operative Bank or not and whether they were really paid as bribe amounts or not would be aspects that will have to be considered at the trial". On this observa tion, it has to be stated, that it 770 has not been shown by any extract of bank account that the said two sums came from the Patna Urban Co operative Bank. If that was so there would have been entries in the Bank accounts. Mere crediting of two sums, without any other reliable evidence, in a bank account by a politically or a friend does not by itself show that the sums were either bribe amounts or any official. favour had been shown. This fact by itself is not conclusive about the guilt of the accused. As regards the ante dating of the order dated 16.5.1975 it may be noticed that Tulzapurkar, J. himself observes in the course of his order "It is true that a mere ante dating a document or an order would not amount to an offence of forgery but if the document or the order is ante dated with the obligue motive or fraudulent intent indicated above (without the same actually materialising) it will be a forgery. " The passing of the two orders one on 16.5.1975 on the note sheet and the other on buff paper which is dated 14.5.1975 is not in dispute. It is explained that it was the practice in the Bihar Secretariat that whenever an order is changed it is done by writing the later order on a buff sheet and pasting it on the earlier order. We were shown another file of the Bihar Government where similar pasting had been done. Tulzapurkar, J. observes that "the second order which was ante dated with the obvious fradulent intent of nullifying or rendering any action that could have been or in fact might have been taken (even if not actually taken) pursuant to the first order after the file had left the Chief Minister 's Secretariat on 16.5.1975, that being the most material consequence flowing from the act of ante dating the second order". It is not shown by the prosecution that any action had been taken pursuant to the order dated 16.5.1975 by any of the departmental authorities. If any action had been taken it would have been a matter of record readily available for production. No such record is produced before the Court. Hence it is a mere surmise to say that any such action was sought to be nullified, particularly when there was no acceptable evidence at all on the communication of the order dated 16.5.1975 to any departmental authori ties. I also adopt the reasons given by Bahrul Islam. J. and R.B. Misra, J. in support of my judgment. In fact about 23 criminal cases have been launched against Naval Kishore Sinha and others for the offences alleged to have been committed by them. They remain unaf fected. The questions involved in this case are whether Dr. Jagannath Misra has been a privy to the misdeeds committed in the Patna Urban Co operative Bank, whether he and his co accused should be prosecuted for the offences of conspi 771 racy, bribery etc., and whether the Public Prosecutor had grievously erred in applying for the withdrawal of the case. All the other Judges who have dealt with the case on merits from the Special Judge onwards, except Tulzapurkar, J., have opined that the permission was properly given for withdraw al. In the circumstances, it is difficult to take a differ ent view in this case. I respectfully agree with the legal position flowing from section. 321 of the Code of Criminal Procedure as explained by Krishna Iyer and Chinnappa Reddy, JJ. in re spect of cases relating to Bansi Lal and Fernandes in R.K. Jain etc. , vs State through Special Police Establishment and Ors., etc. ; , In that case Chinnappa Reddy, J. has summarised the true legal position thus: "1. Under the scheme of the Code prosecution of an offender for a serious offence is pri marily the responsibility of the Executive. The withdrawal from the prosecution is an executive function of the Public Prosecutor. The discretion to withdraw from the prose cution is that of the Public Prosecutor and none else, and so, he cannot surrender that discretion to someone else. The Government may suggest to the Public Prosecutor that he may withdraw from the prosecution but none can compel him to do so. 5. The Public Prosecutor may withdraw from the prosecution not merely on the ground of pauci ty of evidence but on other relevant grounds as well in order to further the broad ends of public justice, public order and peace. The broad ends of public justice will certainly include appropriate social, economic and, political purposes Sans Tammany Hall enter prise. The Public Prosecutor is an officer of the Court and responsible to the Court. The Court performs a supervisory function in granting its consent to the withdrawal. 772 8. The Court 's duty is not to reappreciate the grounds which led the Public Prosecutor to request withdrawal from the prosecution but to consider whether the Public Prosecutor applied his mind as a free agent, uninfluenced by irrelevant and extraneous considerations. The Court has a special duty in this regard as it is the ultimate repository of legislative confidence in granting or withholding its consent to withdrawal from the prosecution. We may add it shall be the duty of the Public Prosecutor to inform the Court and it shall be the duty of the Court to appraise itself of the reasons which prompt the Public Prosecutor to withdraw from the Prosecution. The Court has a responsibility and a stake in the administration of criminal justice and so has the Public Prosecutor, its 'Minister of Justice '. Both have a duty to protect the administration of criminal justice against possible abuse or misuse by the Executive by resort to the provisions of s.321 Criminal Procedure Code. The independence of the judi ciary requires that once the case has tra velled to the Court, the Court and its offi cers alone ' must have control over the case and decide what is to be done in each case. " In the circumstances of this case I find it difficult to say that the Public Prosecutor had not applied his mind to the case or had conducted himself in an improper way. If in the light of the material before him the Public Prosecutor has taken the view that there was no prospect of securing a conviction of the accused it cannot be said that his view is an unreasonable one. We should bear in mind the nature of the role of a Public Prosecutor. He is not a persecutor. He is the representative not of an ordinary party to a contro versy, but of sovereignty whose obligation to govern impar tially is as compelling as its obligation to govern at all, and whose interest, therefore, in a criminal prosecution is not that it shall win a case, but that justice shall be done. As such he is in a peculiar and very definite sense the servant of the land the two fold aim of which is that guilt shall not escape or innocence suffer. He may prosecute with earnest and vigour indeed, he should do so. But while he may strike hard blows, he is not at liberty to strike fould ones. It is as much his duty to refrain from improper methods calculated to produce a wrongful conviction as it is to use every legitimate one to bring about a just one. (See Berger vs United States), ; It is a privilege of an accused that he should be prosecuted by a Public Prosecu tor in all cases involving 773 heinous charges whenever the State undertakes prosecution. The judgment of a Public Prosecutor under section 321 of the Code of Criminal Procedure, 1973 cannot be lightly inter fered with unless the Court comes to the conclusion that he has not applied his mind or that his decision is not bona fide. A person may have been accused of several other mis deeds, he may have been an anathema to a section of the public media or he may be an unreliable politician. But these circumstances should not enter into the decision of the Court while dealing with a criminal charge against him which must be based only on relevant material. Judged by the well settled principles laid down by this Court in State of Bihar vs Ram Naresh Pandey; [1957] S.C.R. 279 and R.K. Jain 's case (supra), it is seen that the aver ments in the application are similiar to the avernments in the application made for withdrawal in the case relating to Fernandes which are to be found in R.K. Jain 's case (supra). I feel that no case has been made out in this case for interference. I am also of the opinion that there is no need to differ from the legal position expanded in the above two decisions. If any change in the law is needed, it is for Parliament to make necessary amendment to section 321 of the Code of Criminal Procedure, 1973. It is significant that section 321 of the Code of Criminal Procedure, 1973 is allowed to remain in the same form in 1973 even though in 1957 this Court had construed section 494 of the former Criminal Procedure Code as laid down in Ram Naresh Pandey 's case (supra). I, however, find it difficult to construe section 321 of the Code of Criminal Procedure, 1973 in the light of the principles of administrative law. Before leaving this case I may refer to another circum stance which is rather disturbing. The Review Petition was filed before this Court after the retirement of Bahrul Islam, J. Allegations of bias were made against him appar ently to get the petition admitted. But later on they were withdrawn before the Court hearing the Review Petition pronounced its order. But again in the course of the hearing before this Bench an attempt was made to repeat the allega tion of bias against the learned Judge. But on objection being taken by the Court, it was promptly withdrawn. This conduct on the part of the appellant deserves to be depre cated. The Review Petition was admitted after the appeal had been dismissed only because Nandini satpathy 's case had been subsequently reffered to a larger Bench to review the earli er decisions. When the 774 earlier decisions are allowed to remain intact, there is no justification to reverse the decision of this Court by which the appeal had already been dismissed. There is no warrant for this extra ordinary procedure to be adopted in this case. The reversal of the earlier judgment of this Court by this process strikes at the finality of judgments of this Court and would amount to the abuse of the power of review vested in this Court, particularly in a criminal case. It may be noted that no other court in the country has been given the power of review in criminal cases. I am of the view that the majority judgement of Bahrul Islam and R.B. Misra, JJ. should remain undisturbed. This case cannot be converted into an appeal against the earlier decision of this Court. Having considered all aspects of the case, I agree with the decision of Khalid, J. and dismiss the appeal filed against the judgment of the High court. KHALID, J. I regret I cannot persuade myself to agree with the Judgment now pronounced by the learned Chief Jus tice, the last portion of which was received by me on 18.12. It is unfortunate that a discussion could not be held about this case by the Judges who heard this case, after it was reserved for Judgment in September, 1986. It was by a sheer accident that this appeal came before a Constitution Bench. Criminal Appeal Nos. 48 & 49 of 1983 were originally directed to be posted before a Constitution Bench and this Appeal was also directed to be heard by a Constitution Bench because the same points were involved. Judgments are being pronounced today in those appeals dismissing them. I have agreed with the conclusion but not with the reasoning. Due to paucity of time I have written only a short Judgment there. This appeal has been pending for a long time. I am, therefore, pronouncing a Judgment of my own hurriedly pre pared so that this matter can be given quietus. This appeal had an unpleasant history. I am grieved at the turn of events in this case. Even so, it is necessary to have the utmost restraint in dealing with the said turn of events, because what is involved here, is the credibility of this Court as the Highest Court of the land. In two well reasoned concurring Judgments, Beharul Islam, J. and R.B. Misra, J. dismissed the appeal by their Judgments dated December 16, 1982 and by an equally reasoned Judgment, Tulzapurkar, J. dissented from the main Judgment and allowed the appeal. These Judgments are reported in ; One of the Judges (Baharul Islam,J) demited office on 13.1.1983. An application was filed on 17.1.1983, to review the judgment. This application can only 775 be to review the concurring judgments. On 27.1.1983, an application to raise additional grounds, specifically, based on bias was filed. The review application was considered in chambers on 13.4.1983. Notice was issued, returnable on 19.4.1983. In July, 1983, the matter was again considered in chambers when allegation of bias was given up. In August, 1983, the matter was heard in open Court by Tulzapurkar, J., A.N. Sen, J. and R.B, Misra, J. On August 22, 1983, the order worded as follows (reported in 1983(4) SCC 104) was by A.N. Sen, J. "1, therefore, admit the review petition and direct the rehearing of the appeal. " The learned Judge who gave this order justified his conclu sion with the following observation: "In view of the limited scope of the present proceeding I do not consider it necessary to deal at length with the various submissions made by the learned counsel appearing on behalf of the parties. In the view that I have taken after a very anxious and careful consid eration of the facts and circumstances of this case I am further of the opinion that it will not be proper for me in this proceedings to express any views on the same. Applying the well settled principles governing a review petition and giving my very anxious and care ful consideration to the facts and circum stances of this case, I have come to the conclusion that the review petition should be admitted and the appeal should be re heard. I have deliberately refrained from stating my reasons and the various grounds which have led me to this conclusion. Any decision of the facts and circumstances which, to my mind, constitute errors apparent on the face of the record and my reasons for the finding that these facts and circumstances constitute errors apparent on the face of the record. re sulting in the success of the review petition, may have the possibility of prejudicing the appeal which as a result of my decision has to be re heard. " In paragraph 15, the learned judge directed as follows: "Accordingly, I further direct that the appeal be re heard immediately after the decision of Nandani Satpathy case. " The other Judges agreed with this. 776 3. Thus the Bench that heard the review petition did not disclose in the order, the reasons why re hearing of the appeal was ordered nor did it outline in the order, what constituted errors apparent on the face of the record to justify the order passed. By this order, the Bench did not set aside the earlier judgment. All that was done was to admit the review petition and to direct re hearing of the appeal. The one question seriously debated at the bar is whether the Judgment sought to be reviewed was set aside or not. It was forcefully contended that the earlier judgment was not set aside and was still at large. This was met with the plea that if it was not set aside, what is it that the Court now hears? I will examine this contention presently. One incontrovertible fact is that the earlier was not in terms set aside. Admitting a review petition is not the same thing as setting aside the order, sought to be re viewed. Order 47 Rule 1 C.P.C. deals with review in civil matters. Article 137 of the Constitution is a special power with the Supreme Court to review any judgment pronounced or order made by it. An order passed in a criminal case can be re viewed and set aside only if there are errors apparent on the record. In this case, we are left only to guess what reasons or grounds persuaded the Judge to pass this order, for, the learned Judge has deliberately refrained from stating his reasons and 'various grounds ' in the order. That the Judgment was not set aside can be concluded from one important fact. One of the Judges who was a party to this order (R.B. Misra, J) had earlier dismissed the appeal with convincing reasons. If the Judgment was set, aside by the order passed in the review petition, the learned Judge would definitely have given his own reasons for doing so by a separate order. This has not been done. All that the order says is that the review petition had been admitted. The direction to re hear the appeal, therefore, can only be to ascertain reasons to see whether the Judgment need be set aside. In my view, with great respect, it would be highly unfair to the learned Judge (R.B. Misra, J. ) to contend that his earlier Judgment was set aside. It is left to us now, the unpleasant task to unravel this mystery and to divine the mind of man. I must confess my failure in this task. After heating the lengthy argu ments, I have not been able to find any error apparent on the face of the record in the earlier Judgment. The direc tion contained in the second order was to re hear the ap peal. That wish has been set aside by the reviewing order nor any error 777 discernable on the face of the record shown, in my consid ered view, the original order has to stand, which means that the appeal has to be dismissed affirming it. This is the short manner in which this appeal can be dismissed and I do so. However, I do not propose to rest content with this manner of disposal of the appeal. This matter was heard at length. The stand taken by the appellant is that the earlier Judgment has been set aside. Therefore, it is only fair that the facts of the case and the questions of law beating on them are also considered since the matter has been placed before a bench of five Judges. The appeals referred to this Bench do not raise any questions of constitutional law. There are decisions ren dered by Benches of three Judges and two Judges of this Court wherein the scope of Section 321 of Criminal Procedure Code (Section 494 of Old Criminal Procedure Code) has been discussed at length. Two criminal appeals 48 and 49 of 1983 were referred to a Constitution Bench, originally. The Bench that referred these appeals did not doubt the correctness of such earlier Judgments. The reference order reads as fol lows: "Special leave granted in both the matters. In view of certain decisions referred to at the time of the hearing of the petitions with differing interpretations, it appears that in order to clarify the legal issues connected with power of withdrawal of criminal cases and put them beyond pale of controversy, it is better the matter be placed before Hon 'ble the Chief Justice to place the matter before a larger Bench of five Judges. " It is this order of reference and the direction by the Bench that heard the review petition, to re hear this appeal immediately after the decision in Nandani Satpathy 's case, criminal appeal Nos.48 and 49 of 1983, that has brought this case also before this Bench. This is the accidental coinci dence about which reference was made by me in the opening paragraph of this Judgment. It is not necessary to deal at length with the facts leading to this appeal. The background facts have been given in detail in the Judgment sought to be reviewed. I do not, therefore, think it necessary to encumber this Judgment with all the facts. I shall refer only to the bare facts neces sary for the purpose of this Judgment. 778 8. The appellant and respondent No. 2 belonged to the rival political parties. The appellant is a member of the Bihar Legislative Assembly. Respondent No. 2 was the Chief Minister of Bihar. Respondent No. 4 was a close associated of Respondent No. 2. Respondent No. 3 started the Patna Urban Co operative Bank and became its Chairman. He and respondent No. 2 were close friends. There were some irregu larities in the affairs of the bank. Proceedings were taken to prosecute those connected with the bank for the irregu larities. The then Chief Minister (Respondent No. 2) ordered the prosecution of the office bearers and staff of the bank including its Honorary Secretary Shri K.P. Gupta, Manager M.A. Haidari and the loan clerk. Consequent upon a mid term poll to the Lok Sabha in March, 1977, there was a change of Ministry at the Centre. In April, 1977, the Patna Secretariat Non Gazetted Employees Association submitted a representation against the second respondent to the Prime Minister and the Home Minister of the Union Government. In June, the Government, headed by the second respondent, was replaced by the Government headed by Shri Karpoori Thakur. The Employees ' Association submitted a copy of their representation to the new Chief Minister on July 9, 1977, requesting him to enquire into the allegations against the second respondent. After a detailed procedure and obtaining requisite sanction from the Governor, a crimi nal case was instituted by the vigilance against the second respondent and others. On 19.2.1979, a charge sheet was filed. The charge sheet filed by the State of Bihar against the respondents on 19th February, 1979, was for offences under Sections 420/466/471/109/120 B of I.P.C. and under Sections 5(1)(a), 5(a)(b) & 5(1)(d) read with Section 5(2) of the Prevention of Corruption Act, 1947. The charge against the second respondent was that he, who at all mate rial times, was either a Minister or the Chief Minister of Bihar abusing his position as a public servant, in conspira cy with the other accused, sought to interfere with the criminal prosecution and surcharge proceedings against Nawal Kishore Sinha and others with a view to obtain to himself and to the other respondents pecuniary advantage to the detriment of Patna Urban Cooperative Bank. The Cheif Judi cial Magistrate took cognizance of the case on 29.7.1979. There was a change of ministry in Bihar in June, 1980 and the second respondent became the Chief Minister again. A policy decision was taken on 10.6.1980, that crimi nal cases launched out of political vendetta and cases relating to political agitation be with 779 drawn. On 24.2.1981, the Government appointed Shri L,P. Sinha as a Special Public Prosecutor. On 25.2.1981, the secretary to the Government of Bihar wrote a letter to the District Magistrate informing him of the policy decision taken by the Government to withdraw from prosecution of two vigilance cases including the case with which we are con cerned. He was requested to take steps for the withdrawal of the case. On 17th June, 1981, Shri Sinha made an application under Section 32 1 of the Cr. P.C. to the Special Judge seeking permission to withdraw from the prosecution of respondent Nos. 2, 3 & 4, on four grounds; (a) Lack of prospect of successful prosecution in the light of the evidence, (b) Implication of the persons as a result of political and personal vendetta, (c) Inexpediency of the prosecution for the reasons of the State and public policy and (d) Adverse effects that the continuance of the prosecu tion will bring on public interest in the light of the changed situation. The learned Special Judge gave consent sought, by his order dated 20th June, 1981. A criminal revision was tiled before the High Court against this order. This was dismissed on 14th September, 1981 and this dismiss al has given rise to this appeal. The application for withdrawal and their order granting consent are assailed on the following grounds: (1) The withdrawal was unjustified on merits. (2) It was against the principles settled by this Court in various decisions governing the exercise of power under Section 321 Cr. P.C. (3) Neither the public prosecutor nor the Special Judge applied their mind in the appli cation for withdrawal and in the order giving consent. (4) Shri L.P. Sinha was not competent to apply for withdrawal since Shri A.K.Datta 's appoint ment to conduct the case under Section 24(8) of the Cr. P.C. had not been cancelled. (5) In the circumstances of the. case Shri Sinha did not function independently but was influenced and guided by the State Government decision in the matter and the withdrawal was vitiated for this reason. I will dispose of question No. 4 first. It is not neces sary to 780 consider in detail the question whether Shri Sinha was competent to make the application for withdrawal. The con tention is that Shri Sinha 's appointment is bad since the earlier appointment of Shri Datta had not been set aside. This case was pressed before the three Judges who heard the appeal first and is repeated before us also. All the three Judges who gave the Judgement in the case of Sheonandan Paswan vs State of Bihar & Ors., ; , have declined to accept the plea that Shri Sinha was not a compe tent public prosecutor since Shri Datt 's appointment had not been cancelled. I adopt the reasons given in the judgment and reject the plea repeated before us. The real question that has to be answered in this case is whether the executive function of the public prose cutor in applying for, and the supervisory functions of the Court in granting consent to, the withdrawal have been properly performed or not. The four remaining points enumer ated above virtually revolve around this question. Section 321 needs three requisites to make an order under it valid; (1) The application should be filed by a public prosecutor or Assistant public prosecutor who is competent to make an application for withdrawal, (2) He must be in charge of the case, (3) The application should get the consent of the Court before which the case is pending. I find that all the three requisites are satisfied here. The question is whether the functions by the public prosecu tor and the Court were properly performed. At no stage was a case put forward by any one that the application made by the public prosecutor was either mala fide or that it was not in good faith. There is no allegation of bias against the Special Judge. The application filed by the public prosecu tor discloses the fact that he had gone through the case diary and the relevant materials connected with the case and that he came to the conclusion that in. the circumstances prevailing at the time of institution of the case and inves tigation thereof, the case was instituted on the ground of political vendetta and only to defame the ' fair image of J.N. Misra. This statement of the public prosecutor has not been challenged as borne out of any unwholesome motive. It has not been made out or suggested that the public prosecu tor was motivated by improper considerations. The only contention raised is that the reasons are not sufficient or relevant. The public prosecutor should normally be credited with fair 781 ness in exercise of his power under Section 321, when there is no attack against him of having acted in an improper manner. He had before him the State Government 's communica tion of the policy taken by it. He had before him the case diary statements and other materials. He perused them before filing the application. Thus his part under Section 321 in this case has been performed strictly in conformity with this Section. The question that remains then is whether the grounds urged by him in support of withdrawal were suffi cient in law. The application clearly shows that Sh. Sinha applied his mind to the facts of, the case. One would normally not expect a more detailed statement in an applica tion for withdrawal than the one contained in the applica tion in question, when one keeps in view the scope of Sec tion 321 and the wide language it uses. The plea that there was lack of application of mind by the public prosecutor has only to be rejected in this case. The Chief Judicial Magistrate was acting as the Special Judge. In his order giving consent he has expressly stated that he perused the relevant records of the case before granting consent. This statement was not challenged in the revision petition before the High Court. It has, therefore, to be assumed that the Magistrate perused the relevant records before passing the order. We must give due credence to this statement by the Magistrate. There is no other allegation against the Special Judge. Thus the func tion of the Special Judge was also performed in conformity with the Section. The matter was taken in revision before the High Court. The High Court dismissed the revision and while doing so exercised its power properly because the materials before the Court would justify only an order of dismissal and not an order ordering retrial. Section 32 1 gives the public prosecutor, the power for withdrawal of any case to any stage before judgment is pronounced. This pre supposes the fact that the entire evidence may have been adduced in the case, before the application is 'made. When an application under Section 321 Cr. P.C. is made, it is not necessary for the Court to assess the evidence to discover whether the case would end in conviction of acquittal. To contend that the Court when it exercises its limited power of giving consent under Section 321 has to assess the evidence and find out whether the case would end in acquittal or conviction, would be to re write Section 321 Cr. P.C. and would be to concede to the Court a power which the scheme of Section 321 does not contemplate. The acquittal or discharge order under Section 321 are not the same as the normal final orders in criminal cases. The conclusion will not be backed by a detailed discussion of the evidence in the case of 782 acquittal or absence of prima facie case or groundlessness in the case of discharge. All that the Court has to see is whether the application is made in good faith, in the inter est of public policy and justice and not to thwart or stifle the process of law. The Court, after considering these facts of the case, will have to see whether the application suf fers from such improprieties or illegalities as to cause manifest injustice if consent is given. In this case, on a reading of the application for withdrawal, the order of consent and the other attendant circumstances, I have no hesitation to hold that the application for withdrawal and the order giving consent were proper and strictly within the confines of Section 321 Cr. P.C. 18. While construing Section 321, it is necessary to bear in mind the wide phraseology used in it, the scheme behind it and its field of operation. True, it does not give any guideline regarding the grounds on which an application for withdrawal can be made. But in applying it, we have to bear in mind that it was enacted with a specific purpose and it would be doing violence 'to its language and contents by importing into the section words which are not there or by restricting its operation by fetters in the form of condi tions and provisos. Its predecessor Section 494 had been on the statute book from the inception of the Criminal Proce dure Code. When the code was amended in 1973, this Section was re numbered and the only change brought in this section is to add the words "in charge of the case" while referring to the Public Prosecutor or Assistant Public Prosecutor. The old code contained a section which enabled the Advocate General to inform the High Court before which a case is pending at any stage before the return of the ver dict that he will not further prosecute the defendant upon the charge. This was Section 333 Cr. The discretion of the Advocate General under this Section was absolute. It was not subject to any control. When the Advocate General in forms the High Court that he does not propose to proceed with the prosecution, the Court has no alternative but to stay all proceedings and to act in accordance with that section. That section has now been deleted from the Code. Public Prosecutors are lesser mortals and therefore the discretion given to them by section 321 is less plenary and is made subject to one limitation and that is the consent of the Court before which the prosecution is pending. Section 333, which was deleted consequent on the discon tinuance of original criminal trials in the High Court, has still a beating, while considering the scope of Section 32 1 corresponding to Section 783 494 of the earlier code and a comparative study of the two sections and their scope will be appropriate. Both the Sections pertain to withdrawal of prosecutions though at different level. A harmonious view should, in my view, prevail in the reading of the two sections. Section 333 does not give any discretion or choice to the High Court when a motion is made under it. Such being the case, Section 321 must also be construed,as conferring powers within circum scribed limits to the Court to refuse to grant permission to the public prosecutor to withdraw the prosecution. If such a harmonious view is not taken it would then lead to the anomalous position that while under Section 333, a High Court has to yield helplessly to the representation of the Advocate General and stop the proceedings and discharge or acquit the accused, the subordinate courts when moved under Section 321 Cr. P.C. would have a power to refuse to give consent for withdrawal of the prosecution if it is of opin ion that the case did not suffer from paucity of evidence. The legislature would not have intended to confer greater powers on the subordinate courts than on the High Court in the exercise of powers under Section 494 of the old Code and Section 333 respectively. It would, therefore, be just and reasonable to hold that while conferring powers upon the subordinate courts under Section 494 to give consent to a public prosecutor withdrawing the prosecution, the legisla ture had only intended that the courts should perform a supervisory function and not an adjudicatory function in the legal sense of the term. Section 321 reads as follows: "321. Withdrawal from prosecution The Public Prosecutor or Assistant Public Prosecutor in charge of a case may, with the consent of the Court at any time before the Judgment is pronounced, withdraw from the prosecution of any person either generally or in respect of any one or more of the offences for which he is tried; and, upon such withdrawal: (a) if it is made before a charge has been framed, the accused shall be discharged in respect of such offence or offences; (b) if it is made after a charge has been framed, or when under this code no charge is required, he shall be acquitted in respect of such offence or offences." (Proviso omitted) This Section enables the Public prosecutor, in charge of the case to withdraw from the prosecution of any person at any time before the 784 Judgment is pronounced, but this application for withdrawal has to get the consent of the Court and if the Court gives consent for such withdrawal the accused will be discharged if no charge has been framed or acquitted if charge has been framed or where no such charge is required to be framed. It clothes the public prosecutor to withdraw from the prosecu tion of any person, accused of an offence both when no evidence is taken or even if entire evidence has been taken. The outer limit for the exercise of this power is "at any time before the Judgment is pronounced". The Section gives no indication as to the grounds on which the Public Prosecutor may make the application, or the considerations on which the Court is to grant its consent. The initiative is that of the Public Prosecutor and what the Court has to do is only to give its consent and not to determine any matter judicially. The judicial function implicit in the exercise of the judicial discretion for granting the consent would normally mean that the Court has to satisfy itself that the executive function of the Public Prosecutor has not been improperly exercised, or that it is not an attempt to interfere with the normal course of jus tice for illegitimate reasons or purposes. The Court 's function is to give consent. This sec tion does not obligate the Court to record reasons before consent is given. However, I should not be taken to hold that consent of the Court is a matter of course. When the Public Prosecutor makes the application for withdrawal after taking into consideration all the materials before him, the Court exercises its judicial discretion by considering such materials and on such consideration, either gives consent or declines consent. The section should not be construed to mean that the Court has to give a detailed reasoned order when it gives consent. If on a reading of the order giving consent, a higher Court is satisfied that such consent was given on an overall consideration of the materials avail able, the order giving consent has necessarily to be upheld. It would be useful to compare the scope of the Court 's power under Section 321 with some other sections of the Code. There are some provisos in the Code which relate to the manner in which Courts have to exercise their juris diction in pending cases when applications are made for their withdrawal or when the Court finds that there is no ground to proceed with the cases. Sections 203,227,245,257 and 258 are some such sections. Section 203 of Criminal Procedure Code empowers a Magistrate to dismiss a complaint at the initial stage itself if he is of opinion that there is no sufficient ground for proceeding. But, 785 before doing so, the Magistrate is called upon to briefly record his reasons for so doing. The Section reads as fol lows: "203. Dismissal of complaint. If, after considering the statements on oath (if any) of the complainant and of the wit nesses and the result of the enquiry or inves tigation (if any) under Section 202, the Magistrate is of opinion that there is no sufficient ground for proceeding, he shall dismiss the complaint, and in every such case he shall briefly record his reasons for so doing." Section 245(1) deals with the power of the Magistrate in discharging an accused when no case has been made out against him. However, the Section imposes an obligation on the Magistrate to record his reasons before discharging the accused, Section 245(1) reads as follows: "If, upon taking all the evidence referred to in Section 244, the Magistrate considers, for reasons to be recorded, that no case against the accused has been made out which, if unre butted, would warrant his conviction, the Magistrate shall discharge him." This section gives the Magistrate, in cases where he consid ers that the accused should be discharged, a power to dis charge him but the power is lettered by an obligation to record his reasons for doing so. If reasons are not recorded in an order of discharge that would be violative of the mandate of the Section. Section 245(2) enables the Magistrate to discharge an accused "at any previous stage" of the case also if he considers that the charge against an accused is groundless. Sub section (1) deals with a stage when all evidences re ferred to in Section 244 is taken. Section 244 deals with evidence in any warrant case instituted otherwise than on a police report. It.is when all such evidence has been taken that the Magistrate can discharge the accused under Section 245(1), while Section 245(2) deals with the case in which the evidence referred to in Section '244 has not been taken. Here again the order of discharge by Magistrate has to be supported with reasons for discharge. Section 245(2) reads as follows: 786 "Nothing in this section shall be deemed to prevent a Magis trate from discharging the accused at any previous stage of the case if, for reasons to be recorded by such Magistrate, he considers the charge to be groundless. " An order of discharge under either of the two sub sections can be sustained only if the Magistrate has recorded his reasons for discharge. Section 257 in chapter 20, deals with trial of summons cases by a Magistrate and provides for the withdrawal of complaints. It reads as follows: "257. Withdrawal of Complaint If a complain ant, at any time before a final order is passed in any case under this Chapter, satis fies the Magistrate that there are sufficient grounds for permitting him to withdraw his complaint against the accused, or if there be more than one accused, against all or any of them, the Magistrate may permit him to with draw the same, and shall thereupon acquit the accused against when the complaint is so withdrawn. " The wording of this section is also significantly different from Section 32 1. When a complainant wants to withdraw his complaint against the accused, the Magistrate can permit him to withdraw the same and acquit the accused against whom the complaint is so withdraw, only when he satisfies the Magis trate that there are sufficient grounds for permitting him to withdraw his complaint. other words, the complainant cannot withdraw his complaint as he pleases nor can the Magistrate permit him to do so unless the Magistrate satis fies himself that there are sufficient grounds to withdraw the complaint. This section thus contemplates an order disclosing sufficient grounds to satisfy the Magistrate to accord permission to withdraw the complaint. The power conferred on a Magistrate under this Section is in order to ensure that a complainant does not abuse the process of law by filing a false or vexatious complaint against another and withdrawing the complaint after adequately embarrassing or harassing the accused so as to escape the consequences of a complaint or suit for malacious prosecution by the accused in the complaint. Section 258 Cr. P.C. in the same chapter deals with the power of Magistrate to stop proceedings in certain cases which can also be usefully read. 787 "258. Power to stop proceedings in certain cases In any summons case instituted otherwise than upon complaint, a Magistrate of the first class or, with the previous sanction of the Chief Judicial Magistrate, any other Judicial Magistrate, may, for reasons to be recorded by him, stop the proceedings at any stage without pronouncing any judgment and where such stop page of proceeding is made after the evidence of the principal witness has been recorded, pronounce a judgment of acquittal, and in any other case, release the accused, and such release shall have the effect of discharge." This section deals with the stopping of proceedings at any stage without pronouncing any judgment and acquitting or discharging the accused as the case may be, but the section mandates the Magistrate to record his reasons for doing so. The Magistrate, cannot stop proceedings under this section without recording his reasons. Even in a Sessions case the Sessions Court cannot exercise its powers of discharge under Section 227 without recording reasons therefore. Section 227 is in the following terms: "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 suffi cient ground for proceeding against the ac cused, he shall discharge the accused and record his reasons for so doing. " It is thus clear that the scheme of the above Sections differ from Section 321. The scope of Section 321 can be tested from another angle and that with reference to Section 320 which deals with "compounding of offences". Both these Sections occur in Chapter 24 under the heading "General Provisions as to Enquiries and Trials". Section 320(1) pertains to compound ing of offences, in the table, which are not of a serious nature while Section 320(2) pertains to offences of a slightly serious in nature but not constituting grave crimes. The offences in the table under Section 320(1) may be compounded by the persons mentioned in the third column of the table without the permission of the Court and those given in the Table II, under Section 320(2) can be compound ed only with the permission of the Court. Under Subsection 4(a), when a person who would otherwise be competent to compound an offence under Section 320, is under the age of 18 years 788 or is an idiot or a lunatic, any person competent to con tract on his behalf may, with the permission of the Court, compound such offence. Sub section 4(b) provides that when a person who would otherwise be competent to compound an offence under this Section is dead, the legal representa tive, as defined in the Code of Civil Procedure, of such person may, with the consent of the Court, compound such offence. These two sub sections use the expression "with the permission of the Court" and "with the consent of the Court" which are more or less ejusden generis. On a fair reading of the above mentioned Subsections it can be safely presumed that the Sections confer only a supervisory power on the Court in the matter of compounding of offences. in the manner indicated therein, with this safeguard that the accused does not by unfair or deceitful means, secure a composition of the offence. Viewed thus I don 't think that a plea can be successfully put forward that granting permis sion or giving consent under Subsection 4(a) or 4(b) for compounding of an offence, the Court is enjoined to make a serious detailed evaluation of the evidence or assessment of the case to be satisfied that the case would result in acquittal or conviction. It is necessary to bear in mind that an application for compounding of an offence can be made at any stage. Since Section 321 finds a place in this chapter immediately after Section 320, one will be justified in saying that it should take its colour from the immediate ly preceding Section and in holding that this Section, which is a kindred to Section 320, contemplates consent by the Court only in a supervisory manner and not essentially in an adjudicatory manner, the grant of consent not depending upon a detailed assessment of the weight or volume of evidence to see the degree of success at the end of the trial. All that is necessary for the Court to see is to ensure that the application for withdrawal has been properly made, after independent consideration, by the public prosecutor and in furtherance of public interest. I referred to these sections only by way of illustra tion to emphasis the distinction between section 321 and other sections of the Code dealing with orders withdrawing criminal cases or discharging or stopping proceedings. My purpose in referring to the above sections is only to show that Section 321, in view of the wide language it uses, enables the public prosecutor to withdraw from the prosecu tion any accused, the discretion exercisable under which is lettered only by a consent from Court on a consideration of the materials before it and that at any stage of the case. The Section does not insists upon a reasoned order by the Magistrate while giving consent. All that is 789 necessary to satisfy the section is to see that the public prosecutor acts in good faith and that the Magistrate is satisfied that the exercise of discretion by the public prosecutor is proper. There is no appeal provided by the Act against an order giving consent under Section 321. But the order is revisable under Section 397 of the Criminal Procedure Code. Section 397 gives the High Court or the Sessions Judge jurisdiction to consider the correctness, legality or pro priety of any finding, sentence or order and as to the regularity of the proceedings of any inferior Court. While considering the legality, propriety or the correctness of a finding or a conclusion, normally, the revising Court does not dwell at length into the facts and evidence of the case. The Court in revision considers the materials only to satis fy itself about the correctness, legality and propriety of the findings, sentence or order and refrains from substitut ing its own conclusion on an elaborate consideration of evidence. An order passed under Section 321 comes to this Court by special leave, under Article 136 of the Constitution of India. The appeal before us came thus. It has been the declared policy of this Court not to embark upon a roving enquiry into the facts and evidence of cases like this or even an order against discharge. This Court will not allow itself to be converted into a Court of facts and evidence. This Court seldom goes into evidence and facts. That is as it should be. Any departure from this salutary self imposed restraint is not a healthy practice and does not commend itself to me. It is necessary for this Court to remember that as an apex Court, any observation on merits or on facts and evidence of a case which has to go back to the Courts below will seriously prejudice the party affected and it should be the policy of this Court not to tread upon this prohibited ground and invite unsavory but justifiable criti cism. Is this Court to assess the evidence to find out whether there is a case for acquittal or conviction and convert itself into a trial Court? Or is this Court to order a retrial and examination of hundred witnesses to find out whether the case would end in acquittal or conviction? Either of these conclusions in the case is outside the scope of Section 321. This can be done only if we rewrite Section 321. Section 321 Cr. P.C. is virtually a step by way of composition of the offence by the State. The State is the master of the litigation in criminal cases. It is useful to remember that by the exercise of functions under Section 321, the accountability of the concerned person or persons does not disappear. A private complaint can still be filed if a party is aggrieved by the withdrawal of the prosecution but running the 790 possible risk of a suit of malicious prosecution if the complaint is bereft of any basis. Since Section 32 1 does not give any guideline regarding the grounds on which a withdrawal application can be made, such guidelines have to be ascertained with refer ence to decided cases under this section as ' well as its predecessor Section 494. I do not propose to consider all the authorities cited before me for the reason that this Court had occasion to consider the question in all its aspects in some of its decisions. Suffice it to say that in the Judgments rendered by various High Courts, public poli cy, interests of the administration, inexpediency to proceed with the prosecution for reasons of State and paucity of evidence were considered good grounds for withdrawal in many cases and not good grounds for withdrawal in certain other cases depending upon the peculiar facts and circumstances of the cases in those decisions. AIR 1932. 699 (Giribala Dasi vs Mader Gazi), AIR 1943 Sind 161 (Emperor vs Sital Das), AIR 1936 Cal. 356 (Marihar Sinha vs Emperor), AIR 1949 Patna 233 (The King vs Moule Bux and Ors.) AIR 1952 Raj. 42 and 1933 Privy Council 266 are some of the cases which were brought to our notice. Ram Naresh Pandey 's case reported in is a land mark case which has laid down the law on the point with precision and certainty. In this decision the functions of the Court and the Public Prosecutor have been correctly outlined. While discussing the role of the Court, this Court observed: "His discretion in such matters has necessari ly to be exercised with. reference, to such material as is by then available and it is not a prima facie judicial determination of any specific issue. The Magistrate 's functions in these matters are not only supplementary, at a higher level, to those of the executive but are intended to prevent abuse. Section 494 requiring the consent of the Court for with drawal by the public prosecutor is more in line with this scheme, than with the provi sions of the Code relating to inquiries and trials by Court. It cannot be taken to place on the Court the responsibility for a prima facie determination of the triable issue. For instance the discharge that results therefrom need not always conform to the standard of "no prima facie case" under Sections 209(1) and 253(1) or of 'groundlessness ' under Sections 209(2) and 253(2). This is not to say that a consent is to be lightly given on the applica X X tion of the 791 public prosecutor, without]a careful and proper scrutiny of the grounds on which the application for consent is made. " This decision was approved by this Court in M.N. Sankarana rayanan Nair vs P.V. Balakrishnan & Ors., ; as is seen at page 606: " . . In the State of Bihar vs Ram Naresh Pandey it was pointed out by this Court that though the Section does not give any indication as to the ground on which the Public Prosecutor may make an application on the consideration of which the Court is to grant its consent, it must none the less satisfy itself that the executive function of the Public Prosecutor has not been improperly exercised and that it is not an attempt to interfere with the normal course of justice for illegitimate reasons or purposes . . " 26. I will now briefly refer to some other cases cited to understand how Courts considered the scope of Section 321 depending upon the facts of each case. In the case of Bansi Lal vs Chandan Lal, AIR 1976 SC 370 this Court followed its earlier decision reported in ; which in turn followed and declined consent when withdrawal 'was sought on the ground that the prosecution did not want to produce evidence and continue the criminal matter against the accused. The Sessions Judge gave his consent as it appeared to him "futile to refuse permission to the State to withdraw prosecution". This consent was set aside because reluctance to produce evidence was held to be not sufficient ground for withdrawal. In State of Orissa vs Chandrika Mohapatra & Ors., ; the application for withdrawal was made on two grounds: (i) that it was considered inexpedient to proceed with the case; (ii) that the evidence collected during investigation was meagre and no useful purpose would be served by proceedings with the case against the accused. The Magistrate gave consent holding that compelling the State to go on with the prosecution would involve unnecessary expend iture and waste of public time. This Court upheld the con sent and held that meagre evidence was a legitimate ground for withdrawal. The following observation at page 338 is useful for our purpose on an important aspect In that case, as in this case, the Magistrate had clearly stated in his order that he was giving consent after going through the materials placed before him. This is how the Court summed up its finding: 792 "It is difficult for us to understand how the High Court could possibly observe in its order that the Magistrate had not perused the case diary when in terms the learned Magistrate has stated in his order that he had read the case diary and it was after reading it that he was of the opinion that the averment of the prose cution that the evidence was not sufficient was not iII founded. Then again it is diffi cult to comprehend how the High Court could possibly say that the learned Magistrate accorded consent to the withdrawal of the prosecution on the ground that it was inexpe dient to proceed with the case, when, in so many terms, the learned Magistrate rejected that ground and granted consent only on the second ground based on inadequacy of evidence . " When the Magistrate states in his order that he has consid ered the materials, it is not proper for this Court not to accept that statement. The proper thing to do is to hold that the Magistrate gave consent on objective consideration of the relevant aspects of the case. It would be acting against the mandate of Section 32,1 to find fault with the Magistrate in such cases, unless the order discloses that the Magistrate has failed to consider whether the applica tion is made in good faith, in the interest of public policy and justice and not to thwart or strifle the process of law. In Balwant Singh vs State of Bihar, this Court felt unhappy when the public prosecutor and the Magistrate had surrendered their discretion, but still declined to grant leave under Article 136 and the withdrawal stood confirmed. In Subhash Chander vs State, ; , this Court upheld the consent given for withdrawal since a fresh inves tigation had revealed that the case was framed by the con cerned Police Officers with ulterior motives. This Court observed that two relevant matters to be considered about the consent are: (1) whether the considerations are germane and (2) whether actual decision was taken by the public prosecutor or he only obeyed the orders dictated to him by others. in Rajendra Kumar Jain vs State, ; , this Court had to deal with two sets of cases one relating to the Baroda Dynamite case and the other the Bhiwam Temple Demolition case. In that case, this Court summarised eight propositions which are given in the judgment rendered by Tulzapurkar, J. in Sheonandan Paswan vs State of Bihar & Ors., This Court observed that paucity of evidence is not 793 the only ground on which the Public Prosecutor may withdraw from the prosecution, though that is a traditional ground for withdrawal. Political purposes and political vendetta afford sufficient ground for withdrawal. All the above decisions have followed the reasoning of Ram Naresh Pandey 's case and the principles settled in that decision were not doubted. It is in the light of these decisions that the case on hand has to be considered. I find that the application for withdrawal by the Public Prosecutor has been made in good faith after careful consideration of the materials placed before him and the order of consent given by the Magistrate was also after due consideration of various details, as indicated above. It would be improper for this Court, keep ing in view the scheme of Section 321, to embark upon a detailed enquiry into the facts and evidence of the case or to direct re trial for that would be destructive of the object and intent of the Section. Now, I propose to quickly rush through the facts of the case to make the discussion complete. When the matter was first heard by this Court, the documents produced were profusely referred to by counsel on both sides. This consisted of also affidavits filed by both sides. Baharul Islam, J, after discussing the questions of law examined the factual aspect also.

Under Article 137 of the Constitution of India The Supreme Court shall have power to review any judgment pro nounced or order 703 made by it, subject to the provisions of any law made by Parliament or any rules made under Article 145. The Supreme Court, in exercise of the powers conferred by Article 145 of the Constitution and all other powers enabling it and with the approval of the President made the "Supreme Court 'Rules 1966". Under Rule I of Order XL thereof, the "Court may review its judgment or order but no application for review will he entertained . in a criminal proceeding except on the ground of an error apparent on the face of the re cord. " Patna Urban Cooperative Banks was registered in May 1970 and it commenced its banking business with Nawal Kishore Sinha as its Chairman, K.P. Gupta as its Honorary Secretary, M.A. Hydary as Manager and A.K. Singh as loan clerk. Dr. Jagannath Misra who was then a Member of the Legislative Council was closely associated with Nawal Kishore Sinha and helped the Cooperative Bank and Nawal Kishore Sinha in diverse ways in connection with the affairs of the Bank and assisted in mobilisation of the resources for the Bank. There were some irregularities in the affairs of the Bank. The then Chief Minister Shri Abdul Ghafoor ordered the prosecution of the officers and staff of the Bank including its Honorary Secretary Shri K.P. Gupta, Manager, M.A. Hai dary and the loan clerk. However, this was not done. On 11.4.1975 Shri Abdul Ghafoor was replaced by Dr. Jagannath Misra as Chief Minister. On May 16, 1975 he passed an order that only stern action should he taken for realisation of loans since on the perusal of the file it appeared there was no allegation of defalcation against the Chairman and mem bers of the Board. This date is alleged to have been later changed to May 14, 1975 by a fresh order. As per the revised order directions for restoration of normalcy and holding of Annual General Meeting "of the bank was made. On 15.4.1976 the Reserve Bank cancelled the banking licence issued to the Bank and a liquidator was appointed. Consequent to the report of the Estimates Committee and the debate in the Assembly, Dr. Jagannath Misra directed, on 4.8.76 the prose cution against those involved in the defalcation. Thus 23 criminal cases were filed against the office bearers and loanees but Nawal Kishore Sinha was excluded from being arraigned as an accused. In June 1977 there was a change of Ministry at the Centre. In June 1977 the Government headed by Dr. Jagannath Misra was replaced by the Government headed by Sri Karpoori Thakur. As a sequel to the memorandums submitted by the Patna Secretariat Non gazetted Employees ' Association to the now Chief Minister on 9.7.1977 requesting him to enquire into allegations against Dr. Jagannath Misra, after a detailed procedure and obtaining requisite 704 sanction of the Governor, a criminal case was instituted by the vigilance Department against Dr. Jagannath Misra and others. The charge sheet filed by the State of Bihar against the respondents on 19th February, 1979, was for offences under sections 420/466/ 471/109/120 B of Indian Penal Code and under Sections 5(1) (a), S(a) (b) & 5(1) (d) read with Section 5(2) of the Prevention of Corruption Act, 1947. The charge against Dr. Jagannath Misra was that he, who at all material times, was either a Minister or the Chief Minister of Bihar abusing his position as a Public servant, in con spiracy with the other accused, sought to interfere with the criminal prosecution and surcharge proceedings against Nawai Kishore Sinha and others with a view to obtain to himself and to the other respondents pecuniary advantage to the detriment of Patna Urban Cooperative Bank. The Chief Judi cial Magistrate took cognizance of the case on 29.7.1979. There was a change of ministry in Bihar in June 1980 and the second respondent became the Chief Minister again. A policy decision was taken on 10.6.1980, that criminal cases launched out of political vendetta and cases relating to political agitation be withdrawn. On 24.2.1981 the Govern ment appointed Shri L.P. Sinha as a Special Public prosecu tor. On 25.2.1981, the secretary to the Government of Bihar wrote a letter to the District Magistrate informing him of the policy decision taken by the Government,to withdraw from prosecution of two vigilance cases including the case with which the Court is concerned. He was requested to take steps for the withdrawal of the case. On I7th June, 1981, Shri Sinha made an application under s.32I of the Cr. P.C. to the Special Judge seeking permission to withdraw from the prose cution of respondent Nos. 2, 3 and 4 on four grounds; (a) Lack of prospect of successful prosecution in the light of the evidence, (b) Implication of the persons as a result of political and personal vendetta; (c) Inexpediency of the prosecution for the reasons of the State and public policy and (d) Adverse effects that the continuance of the prosecu tion will bring on public interest in the light of the changed situation. The learned Special Judge gave consent sought, by his order dated 20th June, 1981. The appellant, thereupon, filed a criminal Revision Application No. 874/81 against the order permitting withdrawal of the prosecution. The said application was dismissed in limine by the High Court by an order dated 14.9.1981. The appellant therefore preferred Crl. Appeal No. 241/82 by special leave to this Court. In two well reasoned concurring judgments, Baharul Islam J and R.B. Misra J. dismissed the appeal by their judgments dated December 16, 1982 and by an equally reasoned judgment, Tulzapurkar J. dissented from the 705 main judgement and allowed the appeal. (See Sheonandan Paswan vs State of Bihar & 0rs. ,[(1983) 2 SCR 61] Baharul Islam J. demited office on 13.1. An application was filed on 17.1. 1983 to review the judgment under Article 137 of the Constitution read with Order XI of the Supreme Court Rules. On 22.8.1983, the matter was heard in open court by a Bench consisting of Tulzapurkar J., A.N. Sen J. and R.B. Misra J, and A.N. Sen J. passed an order admitting the Review Petition without disclosing any reason therefor and directed the rehearing of the petition immediately after the decision in Mohd. Mumtaz vs Smt. Nandini Satpathy , which was referred already to a Constitutional Bench of five Judges. Hence the rehearing of the case to review the two concurrent judgments. Dismissing the appeal, in accordance with the opinion of the majority, the Court, (Per Venkataramiah J.) (Majority view) Held: 1.1 Merely because a court discharges or acquits an accused arraigned before it, the court cannot be consid ered to have compromised with the crime. True, corruption, particularly at high places should be put down with a heavy hand. But, the passion to do so should not overtake reason. The Court always acts on the material before it and if it finds that the material is not sufficient to connect the accused with the crime, it has to discharge or acquit him, as the case may be, notwithstanding the fact that the crime complained of is a grave one. Similarly if the case has been withdrawn by the Public Prosecutor for good reason with the consent of the Court, Supreme Court should be slow to inter fere with the order of withdrawal. In either case, where the Special Judge had rejected the application for withdrawal and the High Court had affirmed that order, and where the special judge had permitted the withdrawal but the High Court had reversed that order, the Supreme Court may not have interfered with the orders of the High Court under Article 136 of the Constitution. But this is a case where the Special Judge had permitted the withdrawal of the prose cution, and the said order of withdrawal has been affirmed by the High Court as well as by the majority judgment pro nounced by Supreme Court earlier. Interference by the Su preme Court on review must only be on strong and compelling reasons. [766D H] 1.2 When the earlier decisions of the Supreme Court are allowed to remain in tact, there is no justification to reverse the majority judgments of Baharul Islam and R.B. Misra JJ., reported in ; by which the appeal had already been dismissed. The reversal of the earlier judgment of Supreme Court by the process of Review strikes at 706 the finality of judgments of Supreme Court and would amount to the abuse of the power of review vested in Supreme Court, particularly in a criminal case. This case which was admit ted solely on the ground that Nandini Satpathy 's case had been subsequently referred to a larger Bench to review the earlier decision cannot be converted into an appeal against the earlier decision of Supreme Court. [774A C] R.K. Jain etc. vs State through Special Police Estab lishment and Ors. ; , and State of Bihar vs Ram Naresh Pandey, , referred to. 2.1 Section 321 of the Code of Criminal Procedure cannot be construed in the light of the principles of Administra tive law. The legal position expounded by the Supreme Court in R.K. Jain 's case and in Ram Naresh Pandey 's, case is correct. If any change in the law is needed it is for Par liament to make necessary amendments to section 321 of the Code of the Criminal Procedure, 1973, which has remained so despite the judgment of the Supreme Court in Pandey 's case rendered in 3957. [773D E] 2.2 The judgment of a Public Prosecutor under section 321 of the Code of Criminal Procedure, 1973 cannot be light ly interfered with unless the Court comes to the conclusion that he has not applied his mind or that his decision is not bona fide. A person may have been accused of several other misdeeds, he may have been an anthema to a section of the public media or he may be an unreliable politician. But these circumstances should not enter into the decision of the Court while dealing with a criminal charge against him which must be based only on relevant material. [773B C ] 2.3 In the circumstances of this case, it cannot be said that the Public Prosecutor had not applied his mind to the case or had conducted himself in an improper way. If in the light of the material before him the Public Prosecutor has taken the view that there was no prospect of securing a conviction of the accused it cannot be said that his view is an unreasonable one. The Public Prosecutor is not a Persecu tor. He is the representative not of an ordinary party to a controversy, but of a sovereignty whose obligation to govern impartially is as compelling as its obligation to govern at all, and whose interest, therefore, in a criminal prosecu tion is not that it shall win a case, but that justice shall be done. As such he is in a peculiar and very definite sense the servant of the land, the two fold aim of which is that guilt shall not escape or innocence suffer. He may prosecute with earnest and vigour indeed, he 707 should do so. But while he may strike hard blows, he is not at liberty to strike foul ones. It is as much his duty to refrain from improper methods calculated to produce a wrong ful conviction as it is to use every legitimate one to bring about a just one. [772E H] Berger vs United States, ; , quoted with approval. 2.4 Further the questions involved in this case are: whether Dr. Jagannath Misra has been a privy to the misdeeds committed in the Patna Urban Co operative Bank; whether he and his co accused should be prosecuted for the offences of conspiracy, bribery etc., and whether the Public Prosecutor had grievously erred in applying for the withdrawal of the case. All the other Judges who have dealt with the case on merits from the Special Judge onwards, except Tulzapurkar J. have opined that the permission was properly given for withdrawal. In the circumstances, it is difficult to take a different view. [770G H; 771A B] The three circumstances put up against the accused in this case are (i) that Jiwanand Jha had credited Rs. 10,000 and Rs. 3000 on 27.12.1973 and on 1.4.1974 respectively in the Savings Bank account of Dr. Jagannath Misra; (ii) that there was ante dating of the order passed by Dr. Jagannath Misra on 14.5.1975; and (iii) that there was a second con fessional statement of Hydary which supported the prosecu tion. As regards the two items of bribe, it has not been shown by any extract of bank account that the said two sams came from the Patna Urban Cooperative Bank. If that was so there would have been entries in the Bank accounts. Mere crediting of the two sums, without any other reliable evi dence, in a bank account by a political ally or a friend does not by itself show that the sums were either bribe amounts or any official favour had been shown. This fact by itself is not conclusive about the guilt of the accused. The passing of the two orders one on 15.6.1975 on the note sheet and the other on buff paper which is dated 14.5.1975 cannot be faulted on account of the explanation that it was the practice in the Bihar Secretariat that whenever an order is changed it is done by writing the later order on a buff sheet and pasting it on the earlier order. It is not also shown by the prosecution that any action had been taken pursuant to the order dated 16.5.1975 by any of the depart mental authorities. If any action had been taken it would have been a matter of record readily available for produc tion. No such record is produced before Supreme Court. Hence ' it is a mere surmise to say that any such action was sought to be nullified, particularly when there was no acceptable evidence at all on the communication of the order dated 16.5.1975 to any departmental authorities. [769F G; 770D G ] 708 Per Khalid J. (on behalf of himself and on behalf of section Natarajan J.) 1.1 Admitting a review petition is not, the same thing as setting aside the order sought to be reviewed. Order 47, Rule 1 C.P.C. deals with review in civil matters, Article 137 of the Constitution is a special power with the Supreme Court to review any judgment pronounced or order made by it. An order passed in a criminal case can be reviewed and set aside only if there are errors apparent on the record. In this case, one of the Judges who was a party to the order to review (R.B. Misra J) had earlier dismissed the appeal with convicting reasons. If the judgment was set aside by the order passed in the review petition, the learned Judge would definitely have given his own reasons for doing so by a separate order. This has not been done. All that the order says is that the review petition had been admitted. The direction to re hear the appeal, therefore can only be to ascertain reasons to see whether the judgment need be set aside. [776C G] 2.1 There is no error apparent on the face of the record in the judgment reported as Sheonandan Paswan vs State of Bihar & Ors., ; [776G H] 2.2 All the three judges who gave the earlier judgment in this case have correctly declined to accept the plea that Shri Sinha was not a competent Public Prosecutor since Datt 's appointment has not been cancelled. [780B C] 3.1 Section 321 needs three requisite to make an order under it valid; (1) The application should be filed by a public prosecutor or Assistant Public Prosecutor who is competent to make an application for withdrawal; (2) he must be in charge of the case; (3) the application should get the consent of the court before which the case is pending. All the three requisites are satisfied here. [780D E] 3.2 In the absence of any allegation of mala fide against the public prosecutor or of bias against the Special Judge the Public Prosecutor should normally be credited with fairness in exercise of his power under s.321. Equally, in the absence of a challenge in the revision petition before the High Court to the order of the Special Judge giving consent, it has to be assumed that he has perused the rele vant records before passing the consent order. [781 C E] 3.3 Section 321 gives the public prosecutor the power for withdrawal of any case at any stage before judgment is pronounced. This 709 pre supposes the fact that the entire evidence may have been adduced in the case, before the application is made. When an application under s.32I Cr. P.C. is made, it is not neces sary for the court to assess the evidence to discover wheth er the case would end in conviction or acquittal. To contend that the court when it exercises its limited power of giving consent under s.32I has to assess the evidence and find out whether the case would end in acquittal or conviction, would be to re write s.321 Cr. P.C. and would be to concede to the court a power which the scheme of s.321 does not contem plate. [781 F H] 3.4 The acquittal or discharge order under s.321 are not the same as the normal final orders in criminal cases. The conclusion will not be hacked by a detailed discussion of the evidence in the case of acquittal or absence of prima facie case or groundlessness in the case of discharge. All that the court has to see is whether the application is made in good faith, in the interest of public policy and justice and not to thwart or stifle the process of law. The court, after considering these facets of the case, will have to see whether the application suffers from such improprieties or illegalities as to cause manifest injustice if consent is given. On a reading of the application for withdrawal, the order of consent and the other attendant circumstances, it must be held that the application for withdrawal and the order giving consent were proper and strictly within the confines of section 321 Cr. P.C. [781H; 782A C] 3.5 While construing s.321, it is necessary to bear in mind the wide phraseology used in it, the scheme behind it and its field of operation. True, it does not give any guideline regarding the grounds on which an application for withdrawal can be made. But since it was enacted with a specific purpose, it would be doing violence to its language and contents by importing into the section words which are not there or by restricting its operation by fetters in the form of conditions and provisos. [782C D] 3.6 While conferring powers upon the Subordinate courts under s.321 of the Code, the Legislature had only intended that the court should perform a supervisory function and not an adjudicatory function in the legal sense of the term. Section 321 clothes the public prosecutor to withdraw from the prosecution of any person, accused of an offence both when no evidence is taken or even if entire evidence has been taken. The outer limit for the exercise of this power is "at any time before the judgment is pronounced". The initiative is that of the Public Prosecutor and what the court has to do ' only to give its consent and not to deter mine any matter judicially. The Judicial function implicit in the 710 exercise of the judicial discretion for granting the consent would normally mean that the court has to satisfy itself that the executive function of the Public Prosecutor has not been improperly exercised, or that it is not an attempt to interfere with the normal course of justice for illegitimate reasons or purposes. [484A B; C D] 3.7 The courts ' function is to give consent. It is not obligatory on the part of the court to record reasons before consent is given. However, consent of the court is not a matter of course. When the Public Prosecutor makes the application for withdrawal after taking into consideration all the materials before him, the Court exercises its judi cial discretion by considering such materials and on such consideration either gives consent or declines consent. If on a reading of the order giving consent a higher court is satisfied that such consent was given on an overall consid eration of the materials available, the order giving consent has necessarily to be upheld. [484D G] 3.8 The order under section 321 is pot appealable but only revisable under section 397 of the Code of Criminal Procedure. While considering the legality, propriety or the correctness of a finding or a conclusion, normally, the revising court does not dwell at length into the facts and evidence of the case. The Court, in revision, considers the materials only to satisfy itself about the correctness, legality and propriety of the findings, sentence or order and refrains from substituting an order passed under s.397 appeal comes to the Supreme Court by special leave under Article 136 of the Constitution of India. [789B C] It has been the declared policy of the Supreme Court not to embark upon a roving enquiry into the facts and evidence of cases like this or even an order against discharge. The Supreme Court will not allow itself to be converted into a court of facts and evidence. The Supreme Court seldom goes into evidence and facts. That is as it should be. Any depar ture from this salutary self imposed restraint is not a healthy practice. As an apex Court, any observation on merits or on facts and evidence of a case which has to go back to the courts below will seriously prejudice the party affected and it should be the policy of the court not to tread upon this prohibited ground and invite unsavory but justifiable criticism. Supreme Court cannot assess the evidence to find out whether there is a case for acquittal or conviction and cannot convert itself into a trial court. Nor can this court order a retrial and examination of hun dred witnesses to find out whether the case would end in acquittal or conviction. [789D G] 711 3.9 Section 321 Crl. P.C. is virtually a step by way of composition of he offence by the State. The State is the master of the litigation in criminal cases. By the exercise of functions under s.321 the accountability of the concerned person or persons does not disappear. A private complaint can still be filed if a party is aggrieved by the withdrawal of the prosecution but running the possible risk of a suit of malicious prosecution if the complaint is bereft of any basis. [789G H; 790A] 3.10 When the Magistrate states in his order that he has considered the materials, it is not proper for the court not to accept that statement. The proper thing to do is to hold that Magistrate gave consent on objective consideration of the relevant aspects of the case. It would be acting against the mandate s.321 to find fault with the Magistrate in such cases, unless the order discloses that the Magistrate has failed to consider whether the application is made in good faith, in the interest of public policy and justice and not to thwart or strifle the process of law. The application for withdrawal by the Public Prosecutor has been made in good faith after careful consideration of the materials placed before him and the order of consent given by the Magistrate was also after the consideration of various datails as indicated above. It would be improper for the Court, keeping in view the scheme of s.321, to embark upon a detailed inquiry into the facts and evidence of the case or to direct re trial for that would be destructive of the object and intent of the section. [792C E; 793B D] State of Bihar vs Ram Naresh Pandey, ; M.N. Sankaranarayanan Nair vs P.V. Balakrishnan & Ors., [1972]2 SCR 599; Bansi Lal vs Chandan Lal, AIR ; State of Orissa vs Chandrika Mohapatra & Ors., ; ; Balwant Singh vs State of Bihar, ; Subhash Chander vs State, ; and Rajendra kumar Jain vs State, ; , referred to. 4.1 In this case the Supreme Court is called upon only to consider the ambit and scope of s.321 Crl. P.C. and not the truth or otherwise of the allegations against the re spondent No. 2. The appellant is admittedly a political rival of respondent No.2. There is no love lost between them. It is at the instance of such a highly interested person that the Court is called upon to direct re trial of the case, setting aside the consent given by the Special Judge. The second respondent is a leader of a political party. He was a rival to the Chief Minister who followed him after the 1977 at the time of institution of the case. In 1977, when the second respondent was the Chief Minister, a warrant of arrest was issued 712 against Shri Karpoori Thakur for his arrest and detention. It has been suggested that Shri Thakur had grudge against the second respondent. Viewed against this background, and on the unsatisfactory factual details of the case, accepting the appeal and ordering retrial would not advance either the interests of justice or public interest. [796B E] 4.2 There were two confessional statements of Haidari in this case one on 4.11.1976 and another on 24.1.1978. In the former he did not implicate respondent No.2 but he did it in the next one. The second statement at best is the confes sional statement of a co accused which normally will not inspire confidence, in any court. It is also a statement an accomplice turned approver and hence of a very little evidentiary value. When Supreme Court exercises its juris diction while considering an order giving consent on an application under s.321, consistent with the declared policy of the court not to embark upon evidence, request for an order for retrial on this legally weak and infirm evidence should be rejected. [795A E] 4.3 As to the accusation of forgery, taking the entire evidence against the appellant it cannot be held that he has committed forgery under s.463 or an offence under s.466. Even though there is overwriting or pasting or interpolation or change of digits, there is no evidence at all to show that this paper went out of the Chief Minister 's office or that any one was unduly favoured or that any one secured undue advantage by use of such overwriting. [796A B] Per Bhagwati (on behalf of himself and G.L. Oza J.) (Minority view). (Per contra) 1.1 The Review Bench did exercise the power of review and set aside the order made by the Original Bench. When the Review Bench used the expression "I . . admit the Review" and directed rehearing of the appeal, it must by necessary implication be held to have allowed the Review Petition and set aside the order of the Original Bench. The true meaning and effect of the order of the Review Bench cannot be allowed to be obfuscated by a slight ineptness of the language used by the Review Bench. The substance of the order must always be looked in to its apparent form. [737F H] 1.2 There can be no doubt that the Review Bench was not legally bound to give reasons for the order made by it. The apex Court being the final court against which there is no further appeal, it is not under any legal compulsion to give reasons for an order made by it. But 713 merely because there may be no legal compulsion on the apex court to give reasons. It does not follow that the apex court may dispose of cases without giving any reasons at all. It would be eminently just and desirable on the part of the apex court to give reasons for the orders made by it. But when the apex court disposes of a Review Petition by allowing it and setting aside the order sought to be re viewed on the ground of an error apparent on the face of record, it would be desirable for the apex court not to give reasons for allowing the Review Petition. Where the apex court holds that there is an error apparent on the face of the record and the order sought to be reviewed must there fore be set aside and the case must be reheard, it would considerably prejudice the losing party if the apex court were to give reasons for taking this view. If the Review Bench of the Court were required to give reasons, the Review Bench would have to discuss the case fully and elaborately and expose what according to it constitutes an error in the reasoning of the Original Bench and this would inevitably result in pre judgment of the case and prejudice is rehear ing. A reasoned order allowing a Review Petition and setting aside the order sought to be reviewed would, even before the reheating of the case, dictate the direction of the rehear ing and such direction, whether of binding or of persuasive value, would conceivably in most cases adversely affect the losing party at the rehearing of the case. Therefore, the Review Bench, in the present case, could not be faulted for not giving reasons for allowing the Review Petition and directing rehearing of the appeal. [738B G] 2. It is now well settled law that a criminal proceeding is not a proceeding for vindication of a private grievance but it is a proceeding initiated for the purpose of punish ment to the offender in the interest of the society. It is for maintaining stability and orderliness in the society that certain acts are constituted offences and the right is given to any citizen to set the machinery of the criminal law in motion for the purpose of bringing the offender to book. Locus standi of the complainant is a concept foreign to criminal jurisprudence. Now if any citizen can lodge a first information report or file a complaint and set the machinery of the criminal law in motion and his locus standi to do so cannot be questioned, a citizen who finds that a prosecution for an offence against the society is being wrongly withdrawn can oppose such withdrawal cannot oppose such withdrawal. If he can be a complainant or initiator of criminal prosecution, he should equally be entitled to oppose prosecution which has already been initiated at his instance. If the offence for which a prosecution is being launched is an offence against the society and not merely an individual wrong, any member of the society must have locus to initiate a prosecution as also to resist 714 withdrawal of such prosecution, if initiated. Here in the present case, the offences charged against Dr. Jagannath Misra and others are offences of corruption, criminal breach of trust etc. 'and therefore any person who is interested in cleanliness of public administration and public morality would be entitled to file a complaint; equally he would be entitled to oppose the withdrawal of such prosecution, if it is already instituted. [739C H; 740A] R.S. Nayak vs A.R. Antulay, , referred to 3.1. It is undoubtedly true that the effect of withdrawal of the prosecution against Dr. Jagannath Misra was that he stood discharged in respect the offences for which he was sought to be prosecuted but it was not an order of discharge which was challanged by Sheonandan Paswan in the revision application filed by him before the High Court but it was an order granting consent for withdrawal of the prosecution that was assailed by him. [740E G] 3.2 The analogy of an order of discharge made under section 227 or section 239 of the Code of Criminal Procedure is not apposite because there the Sessions Judge or the Magistrate, as the case may be, considers the entire materi al before him and then comes to the conclusion that there is not sufficient ground or proceeding against the accused or that the charge against the accused is groundless. But, here, when the Magistrate makes an order granting consent to withdrawal of the prosecution under s.321, it is a totally different judicial exercise which he performs and it would not therefore be right to say that if the High Court sets aside the order of the Magistrate granting consent to with drawal from the prosecutor, the High Court would be really setting aside an order of discharge made by the Magistrate. What the High Court would be doing would be no more than holding that the withdrawal from the prosecution should proceed against the accused and ultimately if there is not sufficient evidence or the charges are groundless, the accused may still be discharged. Even the order of discharge can be discharged by the High Court in revision if the High Court is satisfied that the order passed by the Magistrate is incorrect, illegal or improper or that the proceedings resulting in the order of discharge suffer from any irregu larity. [740F H; 741A C] 3.3 The revisional power exercised by the High Court under s.397 is couched in words of widest amplitude and in exercise of this power can satisfy itself as to the correct ness, legality propriety of any order passed by the Magis trate or as to the regularity of any proceedings of such Magistrate. When the Supreme Court is hearing an appeal 715 against an order made by the High Court in the exercise of its revisional power under s.397 it is the same revisional power which the Supreme Court would be exercising and the Supreme Court, therefore, certainly can interfere with the order made by the Magistrate and confirmed by the High Court if it is satisfied that the order is incorrect, illegal or improper. In fact, in a case like the present where the question is of purity and public administration at a time when moral and ethical values are fast deteriorating and there seems to be a crises of character in public life, the Supreme Court should regard as its bounded duty a duty owed by it to the society to examine carefully whenever it is alleged that a prosecution for an offence of corruption or criminal breach of trust by a person holding high public office has been wrongly withdrawn and it should not matter at all as to how many judges in the High Court or the lower court have been party to the granting of such consent for withdrawal. The mathematics of numbers cannot, therefore, be invoked for the purpose of persuading the court not to exercise its discretion under Article I36 of the Constitu tion. [741C H] 4.1 It is a well established proposition of law that a criminal prosecution, if otherwise justifiable and based upon adequate evidence does not become vitiated on account of mala fides or political vendetta of the first informant or the complainant. [742D E] State of Punjab vs Gurdial Singh, , re ferred to. 4.2 The fact that the prosecution against Dr. Jagannath Misra was initiated by the successor Government of Karpoori Thakur after the former went out of power, by itself cannot support the inference that the initiation of the prosecution was actuated by political vendetta or mala fides because it is quite possible that there might be material justifying the initiation of prosecution against Dr. Jagannath Misra and the successor Government might have legitimately felt that there was a case for initiation of prosecution and that is why the prosecution might have been initiated. Therefore, the prosecution cannot be said to be vitiated on that ac count. [742G H; 743A] Krishna Ballabha Sahay and Ors. vs Commission of En quiry; , and P.V. Jagannatha Rao vs State of Orissa, ; , referred to. 5.1 There is no provision of law which requires that no prosecution should be launched against a former Chief Minis ter or a person holding high political office under the earlier regime without first set 716 ting up a Commission of Enquiry for enquiring into his conduct. It cannot be said that if a prosecution is initiat ed without an inquiry being held by a Commission of Enquiry set up for that purpose, the prosecution would be bad or that on that ground alone the prosecution could be allowed to be withdrawn. [743G H; 744A] 5.2 In view of the tardy and slow moving criminal proc ess in India causing inordinate delay and availability of adequate protection under different existing laws to the accused, it would be perfectly legitimate for the successor government to initiate a prosecution of a former Chief Minister or a person who has held high political office under the earlier regime without first having an enquiry made by a Commission of Enquiry, provided of course, the investigation is fair and objective and there is sufficient material to initiate such prosecution. [744A D] 6. No unfettered or unrestricted power is conferred on the Public prosecutor/Assistant Public Prosecutor under section 321 of the Code to apply for withdrawal from the Prosecution, but the said power must be a controlled or guided power or else it will fail foul of Article 14 of the Constitution Section 321 is more or less similar to the powers of the police under section 173 of the Code of Criminal Procedure. [746F H] The police has no absolute or unfettered discretion whether to prosecute an accused or not to prosecute him. In fact, in the constitutional scheme, conferment of such absolute and uncanalised discretion would be violative of the equality clause of the Constitution. The Magistrate is therefore given the power to structure and control the discretion of the police. The discretion of the police to prosecute is thus ' 'combined and confined" and, subject to appeal or revision, and the Magistrate is made the final arbiter on this question. The Legislature has in its wisdom taken the view it would be safer not to vest absolute dis cretion to prosecute in the police which is an Executive arm of the government but to subject it to the control of the judicial organ of the State. The same scheme has been fol lowed by the Lesiglature while conferring power on the Public Prosecutor to withdraw from the prosecution. This power can be exercised only with the consent of the court so that the court can ensure that the power is not abused or misused or exercised in an arbitrary or fanciful manner. Once the charge sheet is filed and the prosecution is initi ated, it is not left to the sweet will of the State or the Public Prosecutor to withdraw from the prosecution. Once the prosecution is launched, its relentless course cannot be halted except on sound considerations germane to public justice. The Public Prosecutor cannot therefore withdraw from the prosecution unless the Court 717 before which the prosecution is pending gives its consent for such withdrawal. This is a provision calculated to ensure non arbitrarinesS on the part of the Public Prosecu tor and compliance with the equality clause of the Constitu tion. [748D H] H.S. Bains vs State, ; ; Subhash Chander vs State & Ors. , ; ; M.N. Sankaranarayanan Nair vs P.N. Balakrishnan & Ors., ; ; and State of Orissa. vs C. Mohapatra, , referred to. 7.1 The position in law in regard to the degree of autonomy enjoyed by the Public Prosecutor vis a vis the government in filling an application for withdrawal of the prosecution is rather confused. Now there can be no doubt that prosecution of an offender who is alleged to have committed an offence is primarily the responsibility of the Executive. It is the Executive which is vested with the power to file a chargesheet and initiate a prosecution. This power is conferred on the Executive with a view to protect ing the society against offenders who disturb the peace and tranquility of the society by committing offences. Of course it is left to the court to decide whether to take cognizance of the offences set out in the charge sheet but the filing of the charge sheet and initiation of the prosecution is solely within the responsibility of the Executive. It is the State through the investigating authorities which files a charge sheet and initiate the prosecution and the Public Prosecutor is essentially counsel for the State for conduct ing the prosecution on behalf of the State. The Public Prosecutor is an officer of the court, as indeed every advocate practising before the court is, and he owes an obligation to the court to be fair and just: he must not introduce any person interest in the prosecution nor must he be anxious to secure conviction at any cost. He must present the case on behalf of the prosecution fairly and objective ly. He is bound to assist the court with his fairly consid ered view and the fair exercise of his intention. But at the same time he conducts the prosecution on behalf of the Central Government or the State Government, as the case may be, and he is an advocate acting on behalf on the Central Government or the State Government which has launched the prosecution. There is nothing wrong if the government takes a decision to withdraw from the prosecution and communicate such direction to the Public Prosecutor. The Public Prosecu tor, would, inter alia, consider the grounds on which the government has taken the decision to withdraw from the prosecution and if he is satisfied that those grounds are legitimate, he may file an application for withdrawal from the prosecution. If on the other hand he takes the view that the grounds which have been given by the government are not 718 legitimate he has two options available to him. He may inform the government that in his opinion, the grounds which have weighed with the government are not valid and that he should be relieved from the case and if this request of his is not granted he may tender his resignation or else, he may make an application for withdrawal from the prosecution as directed by the government and at the hearing of the appli cation he may offer his considered view to the court that the application is not sustainable on grounds set out by him and leave it to the court to reject the application. There is nothing wrong in the Public Prosecutor being advised or directed by the government to file an application for with drawal from the prosecution and the application for with drawal made by him pursuant to such direction or advice is not necessarily vitiated. The Public Prosecutor can of course come to his own independent decision that the prose cution should be withdrawn but ordinarily if he is wise and sensible person he will not apply for withdrawal without consulting the government because it is the government which has launched the prosecution and is prosecuting the accused. Theoretically of course, he can make an application for withdrawal from the prosecution without consulting the government and he cannot be accused of any illegality for doing so and the court may give its consent for such with drawal but in that event the Public Prosecutor would render the risk of incurring the displeasure of the Government which has appointed him. If the Public Prosecutor seeks the permission of the government for withdrawal from the prose cution and the government grants such permission to him and on the basis of such permission he applies for withdrawal the application cannot be said to be vitiated. The proviso to s.321 in fact contemplates in so many terms that in certain categories of offences the Public Prosecutor ap pointed by the State Government cannot move the court for its consent to withdraw from the prosecution without the permission of the Central Government. There is no danger of abuse or misuse of power by the Government inherent in this process because there are two principal safeguards against any such abuse or misuse of power by the government: one is that an application must be based on grounds which advance public justice and the other is that there can be no with drawal without the consent of the Court. [755C H; 756A H; 757A F] State of Bihar vs Ram Naresh Pandey, ; Balwant Singh vs State of Bihar, ; M.N. Sankaranarayanan Nair vs P.V. Balakrishnan & Ors., ; ;.State of Orissa, vs C. Mohapatra, ; and R.K. Jain vs State, ; , referred to. 7.2 The Public Prosecutor cannot maintain an application for 719 withdrawal from the prosecution on the ground that the government does not want to produce evidence and proceed with the prosecution against the accused or that the govern ment considers that it is not expedient to proceed with the prosecution. The Public Prosecutor has to make out some ground which would advance or further the cause of public justice. If the Public Prosecutor is able to show that he may not be able to produce sufficient evidence to sustain the charge, an application for withdrawal from the prosecu tion may be legitimately made by. [758H; 759A B] 7.3 However, where a charge has been framed by the court either under s.228 or s.240 of the Code of Criminal. Proce dure, 1973 it would not be open to the Public Prosecutor to apply for withdrawal from the prosecution on the ground of insufficiency of evidence in support of the prosecution. The reason is that in both these cases the Court applies its mind to the material consisting of the police report and the documents sent with it under s.173 and comes to a conclusion that a prima facie case has been made out against the ac cused and the charge should therefore be framed. When the court has come to this conclusion after full consideration and framed a charge, the court cannot be persuaded on the same material to hold that there is not sufficient evidence to sustain the prosecution. The Public Prosecutor cannot be permitted to make a volte face on the basis of the same material. To do so would be mockery of justice and it would shake the confidence of the court in the purity and integri ty of the administration of justice. It is, therefore, clear that though the prosecution can be withdrawn at any stage, even after the framing of the charge, it would not be compe tent to the Public Prosecutor once the charge is framed, to apply for withdrawal of the prosecution on the ground that the same material which was before the court when it framed the charge is not sufficient to sustain the prosecution. Of course, if some material has subsequently come to light which throws doubt on the veracity of the prosecution case the Public Prosecutor can certainly apply for withdrawal on the ground that the prosecution is not well founded. It may also happen in the meanwhile a key witness may have died or some important evidence may have become unavailable or some such thing may have happened in that event, the Public Prosecutor may legitimately feel that it will not be possi ble to sustain the prosecution in the absence of such evi dence and he may apply for withdrawal from the prosecution. But on the same material without anything more, the Public Prosecutor cannot apply for withdrawal from the prosecution after the charge is framed. To allow him to do so would impair the faith of the people in the purity and integrity of the judicial process. [759C H; 760A E] 720 Bansi Lal vs Chandi Lal, AIR 1976 SC 370, referred to. 7.4 Further while exercising its function under s.239 is to consider the police report and the document sent along with it as also any statement made by the accused if the court chooses to examine him. And if the court finds that there is no prima facie case against the accused the court discharges him. But that is precisely what the court is called upon to do when an application for withdrawal from the prosecution is made by the public prosecutor on the ground that there is insufficient or no evidence to support the prosecution There also the court would have to consider the material placed before it on behalf of the prosecution for the purpose of deciding whether the ground urged by the public prosecutor for withdrawal of the prosecution is justified or not and this material would he the same as the material before the court while discharging its function under s.239. If the court while considering an application for withdrawal on the ground of insufficiency or absence of evidence to support the prosecution has to scrutinise the material for the purpose of deciding whether there is in fact insufficient evidence or no evidence at all in support of the prosecution, the court might as well engage itself in this exercise while considering under s.239 whether the accused shall he discharged or a charge shall he framed against him. It is an identical exercise which the court will he performing whether the court acts under s.239 or under s.321. If that he so, in a warrant case instituted on a police report the public prosecutor should not he entitled to make an application for withdrawal from the prosecution on the ground that there is insufficient or no evidence in support of the prosecution. The court will have consider the same issue under s.239 and it will most certainly further or advance the case of public justice if the court examines the issue under s.239 and gives its reasons for discharging the accused after a judicial consideration of the material before it, rather than allow the prosecution to he withdrawn by the Public Prosecutor. When the prosecution is allowed to he withdrawn there is always an uneasy feeling in the public mind that the case has not been allowed to be agitated before the court and the court has not given a judicial verdict. But if on the other hand, the court examines the material and discharges the accused under s.239 it will always carry greater conviction with the people because instead of the prosecution being withdrawn and taken out of the ken of judicial scrutiny the judicial verdict based on assessment and evaluation of the material before the court will always inspire greater confidence Since the guiding consideration in all these cases is the imperative of public justice and it is absolutely essential that justice must not only he done but also appear to be done. Hence in a warrant case instituted on a police report which the 721 present case against Dr. Jagannath Misra and others admit tedly is it should not be a legitimate ground for the public prosecutor to urge in support of the application for with drawal that there is insufficient or no evidence in support of the prosecution. The court in such a case should be left to decide under s.239 whether the accused should be dis charged or a charge should be framed against him. [761A H; 762A B] 7.5 Ultimately every offence has a social or economic cause behind it and if the State feels that the elimination or eradication of the social or economic cause of the crime would be better served by not proceeding with the prosecu tion, the State should clearly be at liberty to withdraw from the prosecution. Though in this area no hard and fast rule can be laid down nor can any categories of cases be defined in which an application for withdrawal of the prose cution could legitimately be made. It must ultimately depend on the facts and circumstances of each case in the light of what is necessary in order to promote the ends of justice. [762C D; H; 763A B] 7.6 The Court, while considering whether to grant con sent or not, must not accept the ipse dixit of the public prosecutor and content itself by merely examining whether the public prosecutor has applied an independent mind but the court must satisfy itself not only that the grounds are germane or relevant to advancement of public justice but also whether the grounds in fact are satisfactorily estab lished. The ultimate test which must be applied by the court in order to determine the validity of the grounds in a particular case is that the requirement of public justice outweighs the legal justice of that case so that withdrawal from the prosecution could be permitted in the larger inter est of public justice. The imperative of public justice provides the only relevant consideration for determining whether consent should be granted or not. It is not possible to provide an exclusive definition of what may be regarded as failing within the imperative of public justice in a straitjacket formula. Every case must depend on its peculiar facts and circumstances because there may be a myriad situa tion where this question may have to be considered by the Court. [763G H; 764A D] 8. Applying these principles to the facts of the present case, it is clear, that the court of the Chief Judicial Magistrate Patna as also the High Court were clearly in error in granting consent to the withdrawal from the prose cution against Dr. Jagannath Misra and others. There are two very strong and cogent reasons why consent to the withdrawal of the prosecution must be refused. In the first place, the learned Chief Judicial Magistrate could have considered under s.239 whether the 722 material placed before him was sufficient to make out a prima facie case against Dr. Jagannath Misra and the other accused so that if the learned Chief Judicial Magistrate came to the conclusion on the basis of such material that the charge against Dr. Jagannath Misra and the other accused was groundless, he would be bound to discharge them for reasons to be recorded by him in writing. There is no reason why in these circumstances the public prosecutor should be allowed to withdraw from the prosecution under s.321. The same exercise could be performed by the learned Chief Judi cial Magistrate by acting under s.239. Moreover, in the present case, the decision to withdraw from the prosecution was taken by the Cabinet at a meeting held on 24th February 1981 and this meeting was presided over by Dr. Jagannath Misra himself. It may be that Shri Lallan Prasad Sinha did not implicitly obey the decision of the Cabinet and applied his independent mind to the question whether the prosecution should be withdrawn or not but even so, it would seriously undermine the confidence of the people in the administration of justice if a decision to withdraw the prosecution against him is taken by the accused himself and pursuant to this decision the Special Public Prosecutor who was appointed by the State Government of which the accused is Chief Minister, applies for withdrawal from the prosecution. It is an ele mentary principle that justice must not only done but must also appear to be done. It would be subversive of all prin ciples of justice that the accused should take a decision to withdraw the prosecution against himself and then the Spe cial Public Prosecutor appointed in effect and substance by him makes an application for withdrawal from the prosecu tion. [764E H; 765A E] 8.2 It is no doubt true that if there is not sufficient evidence to sustain the prosecution against Dr. Jagannath Misra and the other accused, it would be subjecting them to harassment and inconvenience to require them to appear and argue before the Court for the purpose of securing an order of discharge under s.239, but even so it would be desirable in the interest of public justice that high political per sonages, accused of offences should face the judicial proc ess and get discharged, rather than seem to manoeuvre the judicial system and thus endanger the legitimacy of the political as well as the judicial process. It is possible that in a particular case personal harassment or inconven ience may be caused by non withdrawal of the prosecution, if the accused is really innocent and is ultimately liable to be discharged, but such harassment or inconvenience must be considered as an inevitable cost of public life, which the repositories of public power should have no hesitation to pay, as justice must not only be done but must also appear to be done. [765E H; 766A] 723

Civil Appeal No. 220 (NT) of 1986 370 From the Judgment and order dated 20th November, 1985 of the Karnataka High Court in Writ Petition No. 27805 of 1982. C.K. Viswanath Iyer, K.M.K. Nair and S.T. Desai for the Appellants B.R.L. Iyengar, M. Veerappa for the Respondents. The Judgment of the Court was delivered by BHAGWATI, C.J. The short question that arises for determination in this appeal by certificate is whether shrimps, prawns and lobsters subjected to processing like cutting of heads and tails, peeling, deveining, cleaning and freezing cease to be the same commodity and become a different commodity for the purpose of the . Can they still go under the description of shrimps, prawns and lobsters or in other words, when we use the words 'shrimps, prawns and lobsters ' do they mean only raw shrimps, prawns and lobsters as caught from the sea or do they also include processed and frozen shrimps, prawns and lobsters. This question which falls for determination in the present appeal arising out of the following facts. The appellants are a partnership firm carrying on business as dealers in shrimps, prawns and lobsters and other sea food products. The appellants are registered as a dealer both under the Karnataka Sales Tax Act, 1957 and the . The appellants in the course of their business purchase shrimps, prawns and lobsters locally for the purpose of complying with orders for export and they cut the heads and tails of the shrimps, prawns and lobsters purchased by them, peel, devein and clean them and after freezing and packing them in cartons, they export them to foreign buyers outside India under prior contracts of sale. The appellants filed their statement of monthly turn over for the month of April 1982 before the Assistant Commissioner of Commercial Taxes, Mangalore and in this statement of monthly turn over, they claimed total exemption from tax in respect of the purchase turn over of shrimps, prawns and lobsters on the ground that the same had been purchased in the course of export. The appellants relied on sub section (3) of section 5 of the which reads as follows: "Notwithstanding anything contained in sub section (1) the last sale or purchase of any goods preceding the sale or purchase occasioning the export of those goods out of the 371 territory of India shall also be deemed to be in the course of such export, if such last sale or purchase took place after, and was for the purpose of complying with, the agreement or order for or in relation to such export. " The appellants contended that since the purchases of shrimps, prawns and lobsters had been made by them for the purpose of complying with the orders for export, such purchases of shrimps, prawns and lobsters must be deemed to be in the course of export and they were accordingly not taxable under the Karnataka Sales Tax Act 1957. This contention of the appellants was rejected by the Assistant Commissioner of Commercial Taxes and on 30th July 1982 an order was made by the Assistant Commissioner of Commercial Taxes for the month of April 1982 under section 12 B (2) of the Karnataka Sales Tax 1957 assessing the appellants to purchase tax and other incidental taxes in respect of the purchases of shrimps, prawns and lobsters made by them during the said period. The Assistant Commissioner of Commercial Taxes also passed another order dated 3rd August 1982 assessing the appellants to purchase tax and other incidental taxes in respect of the purchases of shrimps, prawns and lobsters made by them during the month of May, 1982. These two orders made by the Assistant Commissioner of Commercial Taxes were followed by issue of notices of demand for Rs.52,610.71 and Rs.44,237.88 respectively against the appellants. The appellants thereupon filed a writ petition in the High Court of Karnataka challenging the assessment orders and the notices of demand issued against them and sought appropriate direction, order or writ restraining the respondents from imposing or collecting purchase tax on purchase turn over of shrimps, prawns and lobsters under the Karnataka Sales Tax Act 1957. The writ petition was dismissed by the High Court, but having regard to the importance of the question involved, a certificate under Article 133 of the Constitution was granted by the High Court and that is how the present appeal by certificate has come before us. It is clear on a plain reading of sub section (3) of Section 5 of the that in order to attract the applicability of that provision, it is necessary that the goods which are purchased by an assessee for the purpose of complying with the agreement or order for or in relation to export, must be the same goods which are exported out of the territory of India. The words "those goods" in this subsection are clearly referable to "any goods" mentioned in the preceding part of the sub section and it is therefore obvious that the goods 372 purchased by the assessee and the goods exported by him must be the same. If by reason of any processing to which the goods may be subjected after purchase, they change their identity so that commercially they can no longer be regarded as the original goods, but instead become a new and different kind of goods and then they are exported, the purchases of original goods made by the assessee cannot be said to be purchases in the course of export. The question which therefore arises for consideration is as to what happens when shrimps, prawns and lobsters purchased by the assessee are subjected to the process of cutting of heads and tails, peeling, deveining, cleaning and freezing before export. Do they cease to be the original commodity and become commercially a new commodity or do they still retain their original identity as shrimps, prawns and lobsters? Before we proceed to consider this question, it is necessary to refer to certain provisions of the Karnataka Sales Tax Act, 1957 (hereinafter referred to as the 'Karnataka Act ') which came into force on 1st October 1957. Section 5 of the Karnataka Act which enacts the charging section provides for levy of tax on sales and purchases of various commodities described in the Schedules to the Act. The Third Schedule to the Karnataka Act, as originally enacted, enumerated the commodities on which a single point tax was leviable under subsection 3(b) of section 5 and there were 13 entries in this Schedule. None of these 13 entries included shrimps, prawns and lobsters with the result that the purchases of shrimps, prawns and lobsters were not exigible to purchase tax. This position continued right from the time of the original enactment until 31st March 1973 when the Karnataka Sales Tax (Amendment) Act, 1973 introduced a new Entry '13a ' in the Third Schedule with effect from Ist April 1973. This entry included "shrimps, prawns and lobsters" in the Third Schedule. There was another amendment made in the Karnataka Act in 1978 by the Karnataka Sales Tax (Amendment) Act, 1978 and section 9 of this Amending Act made certain amendments in Entry 13a with retrospective effect, so that from 1st April 1973 Entry 13a included in the Third Schedule "shrimps, prawns and lobsters other than processed or frozen shrimps, prawns and lobsters" and the Explanation to Entry 13a provided that "processing" shall include "all or any of the following, namely, cutting of head or tail, peeling, deveining, cleaning or freezing". But, Entry 13a in this form continued only up to 31st August 1978 and with effect from 1st September, 1978, a further amendment was made by the Karnataka Taxation and Certain Other Laws (Amendment) Act, 1982 and after this amendment which was made 373 with retrospective effect from 1st September 1978, Entry 13a read: "Shrimps, prawns and lobsters other than frozen shrimps, prawns and lobsters". The amendment made by the 1982 Amendment Act excluded from the scope and ambit of Entry 13a, frozen shrimps, prawns and lobsters and brought within the net of taxation only purchases of shrimps, prawns and lobsters other than frozen shrimps, prawns and lobsters, provided they were last purchases within the State. It is in the context of these provisions of the Karnataka Act that we have to consider whether shrimps, prawns and lobsters, when subjected to the process of cutting of heads and tails, peeling, deveining, cleaning and freezing, retain their original character and identity or become another distinct commodity. The test which has to be applied for the purpose of determining whether a commodity subjected to processing retains its original character and identity is as to whether the processed commodity is regarded in the trade by those who deal in it as distinct in identity from the original commodity or it is regarded, commercially and in the trade, the same as the original commodity. It is necessary to point out that it is not every processing that brings about change in the character and identity of a commodity. The nature and extent of processing may vary from one case to another and indeed there may be several stages of processing and perhaps different kinds of processing at each stage. With each process suffered, the original commodity experiences 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 commodity that it can be said that a new commodity, distinct from the original, has come into being. The test is whether in the eyes of those dealing in the commodity or in commercial parlance the processed commodity is regarded as distinct in character and identity from the original commodity vide Sales Tax Board vs PIO Food Packers ; It is clear on an application of this test that processed or frozen shrimps, prawns and lobsters are commercially regarded the same commodity as raw shrimps, prawns and lobsters. When raw shrimps, prawns and lobsters are subjected to the process of cutting of heads and tails, peeling, deveining, cleaning and freezing, they do not cease to be shrimps, prawns and lobsters and become another distinct commodity. They are in common parlance known as shrimps, prawns and lobsters. There is no essential difference between raw shrimps, prawns and lobsters and processed or frozen shrimps, prawns and lobsters. 374 The dealer and the consumer regard both as shrimps, prawns and lobsters. The only difference is that processed shrimps, prawns and lobsters are ready for the table while raw shrimps, prawns and lobsters are not, but still both are, in commercial parlance, shrimps, prawns and lobsters. It is undoubtedly true that processed shrimps, prawns and lobsters are the result of subjecting raw shrimps, prawns and lobsters to a certain degree of processing but even so they continue to possess their original character and identity as shrimps, prawns and lobsters, notwithstanding the removal of heads and tails, peeling, deveining and cleaning which are necessary for making them fit for the table. Equally it makes no difference in character or identity when shrimps, prawns and lobsters are frozen for the purpose of preservation and transfer to other places including far off countries in the world. There can therefore be no doubt that processed or frozen shrimps, prawns and lobsters are not a new and distinct commodity but they retain the same character and identity as the original shrimps, prawns and lobsters. This view finds ample support from the decision of the Supreme Court of the United States in East Texas Motor Freight Lines vs Frozen Food Express, ; , where the question was whether dressed and frozen chicken was a commercially distinct article from the original chicken. The Supreme Court held that it was not a commercially distinct article but was commercially and in common parlance the same article as chicken. The Supreme Court pointed out: "Killing, dressing 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". and proceeded to add in words clear and explicit: " . . 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." 375 If dressed and frozen chicken is not a commercially distinct article from the original chicken, it must follow on a process of analogical reasoning that processed and frozen shrimps, prawns and lobsters cannot be regarded as commercially distinct commodity from raw shrimps, prawns and lobsters. This conclusion on principle was not disputed by the High Court in its judgment and the High Court conceded that even after processing such as cutting of heads and tails, peeling, deveining, cleaning and freezing, shrimps, prawns and lobsters subjected to such processing continued in common parlance to be called 'shrimps, prawns and lobsters '. But the High Court took the view that Entry 13a after the amendment effected in it with retrospective effect from 1st September, 1978, made a distinction between raw shrimps, prawns and lobsters and processed or frozen shrimps, prawns and lobsters. In view of this distinction made in Entry 13a, it was not possible to hold that processed or frozen shrimps, prawns and lobsters were the same commodity as raw shrimps, prawns and lobsters. The argument was that when the State Legislature itself made a distinction between these categories of commodities by making purchases of one category amenable to sales tax under Entry 13a and leaving out of the scope of taxation under Entry 13a the other category, how could it be said that both these categories represent the same commodity and there is no difference in character and identity between the two. This argument, we are afraid, is not well founded. It is based on a total misapprehension in regard to the true object and intendment of Entry 13a and it erroneously seeks to project that Entry in the interpretation and application of Section 5 sub section (3) of the . In fact Entry 13a as amended, supports the argument that even processed or frozen shrimps, prawns and lobsters are known commercially and in the trade as 'shrimps, prawns and lobsters '. It is because Entry 13a as it stood prior to its amendment, would have, on the plain natural meaning of the expression 'shrimps, prawns and lobsters ' included processed and frozen shrimps, prawns and lobsters, that it became necessary for the State Legislature to amend Entry 13a with retrospective effect so as to exclude from the scope and ambit of that entry processed or frozen shrimps, prawns and lobsters. Now when the State Legislature excluded processed or frozen shrimps, prawns and lobsters from the ambit and coverage of Entry 13a, its object obviously was that the last purchases of processed or frozen shrimps, prawns and lobsters in the State should not be exigible to State Sales Tax under Entry 13a. The State Legislature was not at all concerned with the question as to 376 whether processed or frozen shrimps, prawns and lobsters are commercially the same commodity as raw shrimps, prawns and lobsters or are a different commodity and merely because the State Legislature made a distinction between the two for the purpose of determining exigibility to State Sales Tax, it cannot be said that in commercial parlance or according to popular sense, processed or frozen shrimps, prawns and lobsters are recognised as different commodity distinct from raw shrimps, prawns and lobsters. The question whether raw shrimps, prawns and lobsters after suffering processing retain their original character or identity or become a new commodity has to be determined not on the basis of a distinction made by the State Legislature for the purpose of exigibility to State Sales Tax because even where the commodity is the same in the eyes of the persons dealing in it the State Legislature may make a classification for determining liability to sales tax. This question, for the purpose of the , has to be determined on the basis of what is commonly known or recognised in commercial parlance. If in commercial parlance and according to what is understood in the trade by the dealer and the consumer, processed or frozen shrimps, prawns and lobsters retain their original character and identity as shrimps, prawns and lobsters and do not become a new distinct commodity and are as much 'shrimps, prawns and lobsters ', as raw shrimps, prawns and lobsters, sub section (3) of section 5 of the would be attracted and if with a view to fulfilling the existing contracts for export, the assessee purchases raw shrimps, prawns and lobsters and processes and freezes them, such purchases of raw shrimps, prawns and lobsters would be deemed to be in course of export so as to be exempt from liability to State Sales Tax. Here in the present case, it was not disputed on behalf of Revenue that the purchases of raw shrimps, prawns and lobsters were made by the appellants for the purpose of fulfilling existing contracts for export and after making such purchases the appellants subjected raw shrimps, prawns and lobsters purchased by them to the process of cutting of heads and tails, peeling, deveining, cleaning and freezing and exported such processed and frozen shrimps, prawns and lobsters in fulfilment of the contracts for export. The only argument raised on behalf of Revenue was that the goods which were exported were not the same as the goods purchased by the appellants because raw shrimps, prawns and lobsters after processings ceased to be the same commodity and became a new distinct commodity. But, for reasons which we have already discussed, this argument cannot be sustained. 377 The shrimps, prawns and lobsters purchased by the appellants did not lose their original character and identity when they were subjected to processing for the purpose of export. So far as commercial parlance or popular usage is concerned, they remained the same goods and hence the purchases of raw shrimps, prawns and lobsters by the appellants must be held to be purchases in the course of export and hence exempt from liability to tax under the Karnataka Sales Tax Act. We, accordingly, allow the appeal, set aside the judgment of the High Court as also the Orders made by the Assistant Commissioner of Commercial Taxes and direct that the purchases of raw shrimps, prawns and lobsters made by the appellants for the purpose of fulfilling the existing contracts for export shall not be included in the tax able turnover of the appellants. The respondents will pay the costs of the appeal to the appellants. S.R. Appeal allowed.

The appellants are a partnership firm carrying on business as dealers in shrimps, prawns and lobsters and other sea food products. They are registered as a dealer both under the Karnataka Sales Tax Act, 1957 and the . The appellants in the course of their business purchase shrimps, prawns and lobsters locally for the purpose of complying with orders for export and they cut the heads and tails of the shrimps prawns and lobsters purchased by them, peel, devein and clean them and after freezing and packing them in cartons, they export them to foreign buyers outside India under prior contracts of sale. The appellants filed their statement of monthly turnover for the month of April 1982 before the Assistant Commissioner of Commercial Taxes, Mangalore and claimed total exemption from tax in respect of the purchase turn over of shirmps, prawns and lobsters under the Karnataka Sales Tax Act, 1957. The Assistant Commissioner of Commercial Taxes rejected the said claim by his two assessment orders and issued two notices of demand for Rs.52,610.71 and Rs.44,237.88 respectively against the appellants. The appellants, thereupon, filed a writ petition in the High Court of Karnataka challenging all the said orders and notices of demand and sought appropriate direction, order or writ restraining the respondents from imposing or collecting purchase tax on purchase turn over of shrimps, prawns and lobsters under the Karnataka Sales Tax Act, 1957. The writ petition was dismissed by the High Court, but having regard to the importance of the question 368 involved a certificate under Article 133 of the Constitution was granted by the High Court. Allowing the appeal, the Court ^ HELD: 1.1. In order to attract the applicability of sub section (3) of section 5 of the , it is necessary that the goods which are purchased by an assessee for the purpose of com plying with the agreement or order for or in relation to export, must be the same goods which are exported out of the territory of India. The words "those goods" in sub section (3) are clearly referable to "any goods" mentioned in the preceding part of the sub section and, therefore, the goods purchased by the assessee and the goods exported by him must be the same. If by reason of any processing to which the goods may be subjected after purchase, they change their identity so that commercially they can no longer be regarded as the original goods, but instead become a new and different kind of goods and then they are exported, the purchases of original goods made by the assessee cannot be said to be purchases in the course of export. 1.2 The test which has to be applied for the purpose of determining whether a commodity subjected to processing retains its original character and identity is as to whether the processed commodity is regarded in the trade by those who deal in it as distinct in identity from the original commodity or it is regarded, commercially and in the trade, the same as the original commodity. It is not every processing that brings about change in the character and identity of a commodity. The nature and extent of processing may vary from one case to another and indeed there may be several stages of processing and perhaps different kinds of processing at each stage. With each process suffered, the original commodity experiences 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 commodity that it can be said that a new commodity, distinct from the original. has come into being. Sales Tax Board vs PIO Food Packers ; applied. 1.3 The shrimps, prawns and lobsters purchased by the appellants did not lose their original character and identity when they were subjected to processing for the purpose of export. so far as commercial parlance or popular usage is concerned, they remained the same goods. 369 The dealer and the consumer regarded both as shrimps, prawns and lobsters. The only difference is that processed shrimps, prawns and lobsters are ready for the table while raw shrimps, prawns and lobsters are not but still both are in commercial parlance, shrimps, prawns and lobsters. The fact that they undergo a certain degree of processing or frozen for the purpose of preservation and transfer to other places including far off countries in the world makes no difference in character or identity as the original shrimps, prawns and lobsters. Hence, the purchases of raw shrimps, prawns and lobsters by the appellants must be held to be purchases in the course of export and hence exempt from liability to tax under the Karnataka Sales Tax Act, 1957 as amended. [377A B] East Taxes Motor Freight Lines vs Frozen Food Express (100) L.Ed. 917 quoted with approval. 1.4 Entry 13a of the Third Schedule to the Karnataka Act also makes it clear that even processed or frozen shrimps, prawns and lobsters are known commercially and in the trade as shrimps, prawns and lobsters. When the State Legislature excluded processed or frozen shrimps, prawns and lobsters from the ambit and coverage of Entry 13a, its object obviously was that the last purchases of processed or frozen shrimps, prawns and lobsters in the State should not be exigible to State Sales Tax under Entry 13a. The State Legislature was not at all concerned with the question as to whether processed or frozen shrimps, prawns and lobsters are commercially the same commodity as raw shrimps, prawns and lobsters or are a different commodity. Merely because the State Legislature made a distinction between the two for the purpose of determining exigibility to State Sales Tax, it cannot be said that in commercial parlance or according to popular sense, processed or frozen shrimps, prawns and lobsters are recognised as different commodity distinct from raw shrimps, prawns and lobsters. Further the question whether raw shrimps, prawns and lobsters after suffering processing retain their original character or identity or become a new commodity has to be determined not on the basis of a distinction made by the State Legislature for the purpose of exigibility to State Sales Tax because even where the commodity is the same in the eyes of the persons dealing in it the State Legislature may make a classification for determining liability to sales tax.

(Civil) No. 1155 of 1987. (Under Article 32 of the Constitution of India). S.P. Malik and Mrs. Lalitha Kaushik for the Petitioner. Anil Dev Singh, R. Venkataramani, R.B. Mishra and Ms. A. Subhashini for the Respondents. The Judgment of the Court was delivered by DUTT, J. The petitioner was the Additional Registrar of this Court. His normal date of retirement was March 31, 1987. He, however, sought for voluntary retirement from the service of this Court and on his application in that regard, the following order dated December 6, 1985 was communicated to him by the Registrar of this Court: "OFFICE ORDER The Hon 'ble the Chief Justice of India has accepted the notice of Shri section Banerjee, Offg. Additional Registrar (Perma nent Deputy Registrar), seeking voluntary retirement from service under the provisions of Rule 48A of the Central Civil Services (Pension) Rules, 1972, and has permitted him to retire voluntarily from the service of the Registry of the Supreme Court of India with effect from the forenoon of January 1, 1986. " 564 It is clear from the order extracted above that the petitioner was permitted to retire voluntarily from the service of the Registry of the Supreme Court with effect from the forenoon of January 1, 1986. After the retirement of the petitioner, the Fourth Central Pay Commission (for short 'Pay Commission ') gave its report recommending the revision of salaries and pension of the Government employees. It is not disputed that the above recommendations of the Pay Commission have been accepted by the Government and that the benefit thereof is also avail able to the employees of this Court. Paragraph 17.3 of Chapter 17 of Part II at page 93 of the Report of the Pay Commission provides as follows: "17.3 In the case of employees retiring during the period January 1, 1986 to September 30, 1986, Government may consider treating the entire dearness allowance drawn by them up to December 31, 1985 as pay for pensionary bene fits. " The petitioner claimed the benefit of the recommendation of the Pay Commission as contained in the said paragraph 17.3, but it was not allowed on the ground that he did not, as he was not entitled to, draw salary for January 1, 1986 in view of the proviso to rule 5(2) of the Central Civil Service (Pension) Rules, 1972, hereinafter referred to as 'the Rules '. Rule 5(2) reads as follows: "5(2). The day on which a Government servant retires or is retired or is discharged or is allowed to resign from service, as the case may be, shall be treated as his last working day. The date of death shall also be treated as a working day. Provided that in the case of a Gov ernment servant who is retired pre maturely or who retires voluntarily under clause (j) to (m) of Rule 56 of the Fundamental Rules or Rule 48 (or Rule 48 A) as the case may be, the date of retirement shall be treated as a non working day. " At the hearing of the writ petition, it has also been vehemently urged on behalf of the respondents that as in view of the proviso to rule 5(2) of the Rules, the date of retirement of the petitioner should be treated as a non working day or, in other words, as the petitioner was not entitled to the salary for the day of his retirement, he was not 565 entitled to the benefit of the recommendation of the Pay Commission as contained in paragraph. 17.3 of the report extracted above. Under paragraph 17.3, the benefits recommended will be available to employees retiring during the period, January 1, 1986 to September 30, 1986. So the employees retiring on January 1, 1986 will be entitled to the benefit under para graph 17.3. The question that arises for our consideration is whether the petitioner has retired on January 1, 1986. We have already extracted the order of this Court dated Decem ber 6, 1985 whereby the petitioner was permitted to retire voluntarily from the service of the Registry of the Supreme Court with effect from the forenoon of January 1, 1986. It is true that in view of the proviso to rule 5(2) of the Rules, the petitioner will not be entitled to any salary for the day on which he actually retired. But, in our opinion, that has no bearing on the question as to the date of re tirement. Can it be said that the petitioner retired on December 31, 1985? The answer must be in the negative. Indeed, Mr. Anti Dev Singh, learned counsel appearing on behalf of the respondents, frankly conceded that the peti tioner could not be said to have retired on December 31, 1985. It is also not the case of the respondents that the petitioner had retired from the service of this Court on December 31, 1985. Then it must be held that the petitioner had retired with effect from January 1, 1986 and that is also the order of this Court dated December 6, 1985. It may be that the petitioner had retired with effect from the forenoon of January 1, 1986 as per the said order of this Court, that is to say, as soon as January 1, 1986 had com menced the petitioner retired. But, nevertheless, it has to be said that the petitioner had retired on January 1, 1986 and not on December 31, 1985. In the circumstances, the petitioner comes within the purview of paragraph 17.3 of the recommendations of the Pay Commission. After the conclusion of the hearing of the writ peti tion, an additional affidavit purported to have been af firmed by Mr. P.L. Sakarwal, the Director (Justice) of the Department of Justice. In paragraph 8 of the affidavit the deponent has craved leave of this Court to file this addi tional affidavit. It does not appear from the copy of the purported additional affidavit whether it has been affirmed or not inasmuch as no date of affirmation has been mentioned therein. Be that as it may, a photocopy of the Office Memo randum dated April 14, 1987 of the Ministry of Personnel, Public Grievances and Pensions, Department of Pensions & Pensioners ' Welfare has been annexed. It is submitted in the additional affidavit that the pension of Government servants retiring between 1.1.1986 and 30.6.1987 is to be governed in terms of 566 paragraphs 10.1, 10.2 and 11 of the said Office Memorandum. Further, it has been submitted that the petitioner had ceased to be in the employment of the Supreme Court with effect from 1.1.1986 (F.N.) and, accordingly, the said Office Memorandum is not applicable to the petitioner. Paragraph 3.1 of the Office Memorandum provides, inter alia, that the revised provisions as per these orders shall apply to Government servants who retire/die in harness on or after 1.1.1986. The said Office Memorandum will, therefore, be applicable to Government servants retiring on 1.1.1986. There is, therefore, no substance in the contention that the Office Memorandum dated April 14, 1987 will not apply to the petitioner. Be that as it may, we have already held that the petitioner had retired with effect from 1.1.1986 and he comes within the purview of paragraph 17.3 of the recommen dations of the Pay Commission. In the circumstances, the writ petition is allowed and the respondents are directed to calculate and pay to the petitioner within three months from today his pension in accordance with the recommendation of the Pay Commission as contained in paragraph 17.3 extracted above. There will, however, be no order as to costs. P.S.S. Petition allowed.

Paragraph 17.3 of Chapter 17, Part II of the Report of the Fourth Central Pay Commission entitled Government em ployees retiring during the period January 1, 1986 to Sep tember 30, 1986 to consideration of the entire dearness allowance drawn by them upto December 31, 1985 as pay for pensionary benefits. Rule 5(2) of the Central Civil Services (Pension) Rules, 1972 permits the day on which a Government servant retires from service to be treated as his last working day. The proviso thereto, however, states that in the case of a Government servant who retires voluntarily under Rule 48 A the date of retirement shall be treated as a non working day. The petitioner was permitted to retire voluntarily from the service of the Registry of the Supreme Court under the provisions of Rule 48 A of the Rules with effect from the forenoon of January 1, 1986 by an order dated December 6, 1985. His claim to the benefit of paragraph 17.3 was not acceded to. In the writ petition it was contended for the respond ents that as in view of the proviso to rule 5(2) of the Rules the petitioner was not entitled to the salary for the day of his retirement, he was not entitled to the benefit of paragraph 17.3. Allowing the writ petition, HELD: Under paragraph 17.3 of Chapter 17, Part II of the Report of the Fourth Central Pay Commission the benefits recommended will be available to employees retiring during the period, January 1, 1986 to September 30, 1986. In the instant case, the petitioner was permitted to retire volun tarily from the service of the 563 Registry of the Supreme Court with effect from the forenoon of January 1, 1986. The fact that under the proviso to rule 5(2) of the Rules, the petitioner will not be entitled to any salary for the day on which he actually retired has no bearing on the question as to the date of retirement. The petitioner could not be said to have retired on December 31, 1985. It has then to be said that he had retired with effect from January 1, 1986 and that is also the order of this Court dated December 6, 1985. He, therefore, comes within the purview of paragraph 17.3 of the recommendations of the Pay Commission. [565A E] The respondents to calculate and pay to the petitioner within three months his pension in accordance with the recommendation of the Pay Commission as contained in para graph 17.3. [566D]

Appeal No. 2544 of 1993. From the judgment and Order dated 7.5. 1992 of the Calcutta High Court in Appeal No. Nil of 1992 in Matter No. 21 of 1991. P.S, Poti, and S.K. Nandy for the Appellant. K. Parasaran, A.K. Ganouli, G.K. Banerjee and. Som Mandal for the Respondent. R.M. SAHAI, J. The short and the only question of law that arises for consideration in this appeal is if an appeal was maintainable against an order passed by the Learned Single Judge under Section 39(1) of the either under Section 39(2) of the Act or under the Letters patent jurisdiction. Facts are not in dispute. Since the State did not appoint any arbitrator as provided for in clause 25 of the agreement despite letters by the respondent to the Chief Engineer, Public Works Department (P.W.D) and the Secretary P.W.D. the respondent approached the High Court and a Learned Single Judge by order dated 6th September, 1991 revoked the authority of the Chief Engineer to act as an arbitrator and directed one Shri D.K. Roy Chowdhury to act as the sole arbitrator as suggested by the respondent. Against this order State filed an appeal which has been dismissed by the Division Bench upholding the objection of the respondent as not maintainable. It has been held that the appeal was not maintainable either under Section 39(2) or under Letters Patent. It is the correctness of this view that has been assailed in this appeal. Section 39 of the came up for consideration in Union of India vs Mohindra Supply Company [19621 3 S.C.R. 497. The Court after going into detail and examining various authorities given by different High [Courts held that no, second appeal lay under Section 39 (2) against a decision given by a Learned Single Judge under Section 39(1). In respect of the jurisdiction under Letters Patent the Court observed that since was a consolidating and amending act relating to arbitration it must be construed without any assumption that it was not intended to alter the law relating to appeals. The Court held that in view of bar created by sub section (2) of Section 3 9 debarring an, second appeal from an order passed in appeal under sub section (1) the 'conclusion was 643 inevitable that it was so done with a view to restrict the right of appeal within strict limits defined by Section 39 '. Therefore, so far the second part is concerned, namely, the maintainability of the appeal under Letters Patent it stands concluded by this decision. The Learned counsel for the appellant vehemently argued that since the decision by the Supreme Court was in respect of an appeal directed against an order passed by a Learned Single Judge in exercise of appellate jurisdiction no second appeal lay but that principle could not be applied where the order of Learned Single Judge was passed not in exercise of appellate jurisdiction but original jurisdiction. The argument appears to be without any substance as Sub section (1) of Section 39 which is extracted below "(1) An appeal shall lie from the following orders passed under this Act (and from no others) to the Court authorised by law to hear appeals from original decrees of the Court passing the order: An order (i) superseding an arbitration; (ii) on an award stated in form of a special case; (iii) modifying or correcting an award; (iv) filing or refusing to file an arbitration agreement; (v) staying or refusing to stay legal proceedings where there is an arbitratio n agreement; (vi) setting aside or refusing to set aside an award Provided that the provisions of this section shall not apply to any order passed by Small Cause Court. (2) No second appeal shall lie from an order passed in appeal under this section, but nothing in this section shall affect or take away any right to appeal to the Supreme Court. " 644 provides that an appeal could lie only from the orders mentioned in the subsection itself Since the order passed by Learned Singe Judge revoking the authority of the Chief Engineer on his failure to act as an arbitrator was not covered in either of the six clauses mentioned in Section 39 it is obvious that no appeal could be filed against the order of the Learned Single Judge.] Reliance was placed on certain orders passed by this Court and it was urged that settlement of dispute under clause 25 of the agreement being in exclusive domain of the Chief Engineer the High Court was not empowered to appoint anyone else. The submission is devoid of any merit. It is not made out from the agreement. Rather clause 25 itself permits appointment of another arbitrator if the Chief Engineer fails or omits to act as such. Relevant portion of the agreement is extracted below "Should the Chief Engineer be for any reason unwiling or unable to act as such Arbitrator such questions and disputes shall be referred to an Arbitrator to be appointed by the Arbitrator shall be final, conclusive and binding on all the parties to this contract. " In one of the decisions given by this Court the order of the High Court was set aside as the dispute being technical in nature the appointment of anon technical arbitrator was not justified. Here in this the High Court has appointed a retired Chief Engineer and not a non technical man. No allegation has been made against him. Therefore, the order of the learned Single Judge also does not suffer from any infirmity. In the Circumstances the view taken by the Division Bench dismissing the appeal as not maintainable appears to be well founded. The appeal accordingly fails and is dismissed with costs. S.K. Appeal dismissed.

Despite several letters by the respondent to the Chief Engineer Public works Department the State did not appoint any Arbitrator as provided in Clause 25 of the agreement. Shri D.K. Roy Choudhry who was appointed as a sole Arbitrator by the learned Single Judge revoking the authority of the Chief Engineer to act as an Arbitrator under the agreement. On appeal by the State under Section 39(2) of the Act or under Letters Patent. The High Court dismissed the appeal as not maintainable. This appeal is against the judgment of the High Court. Appeal dismissed, HELD: 1.Section 39 of the came upon for consideration in U.O.I vs Mohindra Supply Company [1962]3 SCC 497 and the Court held that no Second Appeal lay under section 39(2) against a decision given by a learned Single Judge under Section 39(1). is a consolidating and amending act relating to arbitration, it must be construed without any assumption that it was not intended to alter the law relating to appeals. The Court held that in view of bar created by sub section (2) of Section 39 debarring a second appeal from an order passed in appeal under sub section (1) that the 'conclusion was inevitable that it was so done with a view to restrict the right of appeal within strict limits defined by Section 39 '. Therefore the maintainability of the appeal under Letters Patent it stands concluded by this 641 decision. (642 G H) 2. Sub section (1) of Section 39 of the is extracted below: "(1) An appeal shall lie from the following orders passed under this Act (and from no others) to the Court authorised by law to hear appeals from original decisions of the Court passing the order. An order (1) superseding an arbitration; (ii) on an award stated in the form of a special case; (iii) modifying or correcting an award; (IV) filing or refusing to file an arbitration agreement; (v) staying or refusing to stay legal proceedings where there is an arbitration agreement; (vi) setting aside or refusing to set aside an award; Provided that the provisions of this Section shall not apply to any order passed by a Small Causes Court. _ (2) No second appeal shall lie from an order passed in appeal under this Section, but nothing in this Section shall affect or take away any right to appeal to the Supreme Court". (643 D E GH) provides that an appeal could lie only from the orders mentioned in the sub Section itself. Since the order passed by learned Single Judge revoking the authority of the Chief Engineer on his failure to act as an Arbitrator was not covered in either of the six clauses mentioned in Section 39 it is obvious that no appeal could be filed against the order of the learned Single Judge. (644 642